The ever-shifting (political and oligarchical) sands – Ukraine

Moving onward (although probably not upward) from the unnecessarily public spat between The State/President Poroshenko and oligarch Igor Kolomoiski, there would appear to be some resulting shifting of the political and oligarchical sands to mull over – and ponder looking to the immediate future.

That said, Mr Kolomoiski forced the issue with the State/President, and had to be confronted.  A public face-saving compromise has now been announced by Prime Minister Yatseniuk, although privately undoubtedly there will be feelings that scores remain to be settled.  (Notably no criminal proceedings thus far.)

As written last week, there were certain to be ripples and sands-a-shifting as a result.  Mr Kolomoiski is hardly politically sidelined nor crippled by his resignation as Dnepropetrovsk Governor.

“Indeed, now that he once again holds no political office, and therefore once more has no public political face to present, he may well become far more mischievous than when he was holding office. The number of “owned” Rada MPs, the occasional Mayor, and deputies in numerous local administrations from Dnepropetrovsk to Odessa, insure that his ability to politically influence from behind the curtain continues. This method has traditionally always been Mr Kolomoiski’s preferred modus operandi, having previously shunned public office.

There is also the longstanding rumour within the Rada, that both Messrs Kolomoiski and Lyvochkin/Firtash have decided to “reset” the Rada in 2016 – between them “owning” enough MPs to make the current Rada almost unworkable.”

What has become immediately noticeable since leaving the office of Dnepropetrovsk Governor, is that the public animosity between Mr Kolomoiski – or more precisely Mr Kolomoiski’s “people” within the Rada, together with his TV channels, particularly the popular pro-Ukrainian 1+1, on the one hand – and Oleh Lyashko, the walking ego/populist rent-a-mouth leader of The Radical Party on the other, have almost immediately subdued after months of public, and very pointed, sniping.

Only the most naive of on-lookers would believe that this  is in any way due to Mr Lyashko considering Mr Kolomoiski has either suffered, or indeed has been, defeated – thus there no longer being a populist battle to be fought.

Being quite blunt, albeit that Mr Lyashko (and his party) were heavily financed by Messrs Lyvochkin/Firtash during the last Rada elections, Mr Lyashko’s voter base is very much the more hard-core “Ukrainian patriot”, bordering upon “Ukrainian nationalist”, if not both, in the absence of Svoboda.

As such, Mr Lyashko (and the Radical Party), despite having access to the Inter TV channel owned by his party financiers (and ex-Regionaires) Messrs Lyvochkin/Firtash, this channel is not especially popular with his core voter base.  Mr Lyashko’s voter base is much more aligned toward, and indeed inclined to watch, Mr Kolomoiski’s 1+1 TV Chanel.

As has been written many times these past few months, the oligarchy, and in particular Messrs Firtash/Lyvochkin and Kolomoiski, all appear to be ready to “reset” the Rada in 2016.  It is indeed the worst kept secret within the halls of the Rada.

That being the case, and Mr Lyashko’s ego is certainly not being satisfied as a mere “party leader” within the Rada, in anticipation of 2016 elections Mr Lyashko needs to gain good access to the viewers of Mr Kolomoiski’s 1+1, and if possible, Mr Kolomoiski’s financial and/or inferred backing amongst the pro-Ukrainian crowd – a crowd that automatically shuns Messrs Lyvoshkin and Firtash.

Mr Kolmoiski, by allowing such access – or at least greater access – gains the walking ego and parliamentary rent-a-mouth to take on President Poroshenko’s Solidarity party in the Rada, skewering every misstep, mis-speak and unpopular act upon the populist tongue of Mr Lyashko.  Whilst doing so, Mr Kolomoiski can also mitigate the damage to his investment in Prime Minister Yatseniuk’s People’s Front party.  Revenge via a populist proxy presents itself.

Furthermore, as the initial rift between Mr Kolomoiski and Oleh Lyashko related to Mr Lyashko attempting to hijack the populism attached to the Kolomoiski financed volunteer battalions – those battalions now either already integrated into the Army or National Guard, or in the process of negotiating their entry – that particular populist wave is not really there to be ridden as it once was.

Thus, a temporary and partial truce to engineer early Rada elections between Mr Kolomoiski and fellow oligarch Mr Firtash (plus sidekick Mr Lyvochkin), presents President Poroshenko with a far more difficult task of managing their common political oligarchical interests (survival through direct political influence from behind the curtain) when they are temporarily sharing the same proxy populist attack-dog/advocate/anti-Solidarity Party being broadcast across the biggest TV channels in Ukraine (with the exception of the President’s own Channel 5) with increasing frequency.

Naturally, those oligarchical common interests are limited, and will only extend for so long and only to a certain degree.

Whether Oleh Lyashko (and Party) would remain on the Firtash/Lyvochkin payroll, or swap to the Kolomoiski payroll after any elections is perhaps far too soon to call.  Undoubtedly Mr Lyashko’s reach out to Mr Kolomoiski has occurred with the full knowledge of his current Lyvochkin/Firtash paymasters.  Would Mr Kolomoiski finance him too?  Why not, in his time he has financed Ms Tymoshenko (and Batkivshchyna), Oleh Tyahnybok (and Svoboda), Arseny Yatseniuk (and the People’s Front) – so why not Oleh Lyashko (and the Radical Party)?

Whatever the case, it would seem reasonable to anticipate that the “Lyashko rent-a-mouth” is about to be unleashed on the President and his Solidarity Party with increasing venom and frequency – with the blessing, encouragement, and the particularly influential media resources of both Mr Firtash’s Inter and Mr Kolomoiski’s 1+1 over the coming months.

Ukrainian Oil & Gas to get international management?

After all the unnecessarily public shenanigans that played out last week between the majority and minority shareholders of Ukrnafta – the State and Igor Kolomoiski – and other potential confrontations, such as Uktransnafta, Prime Minister Arseney Yatseniuk has announced that a change of management, which had a great deal to do with the unnecessarily public collision between State and Igor Kolomoiski, will occur.

It will occur with international management being brought in to insure transparency for all stakeholders.

“A new approach to the state of public companies – Ukrnafta, Ukrtransnafta, and all others, Ukrtatnafta – The state recovers its management, we respect the rights of other shareholders, receive and distribute dividends, and we put in place a new high-quality foreign management.”

First and foremost, a reasonable compromise in light of the aforementioned public spat.  Indeed, perhaps a way to combat corruption at the top of many State owned entities, from energy to the defence entities and beyond.

Naturally to attract the best international industry specific senior professionals, the State and other shareholders will have to pay the commensurate international remuneration (plus perks, and possibly “golden hello’s” and/or “contractually assured “golden handshakes” too) for such management.  That said, it will probably still save the State (and shareholders) a small fortune in losses due to gargantuan corruption by doing so.

The Prime Minister went on to state that “The new leadership will Ukrnefti, it must be selected by an international audit, through professional people with serious international reputation.  “We, the government, decided that now all heads of state companies have elected only in open competition, publicly, live, and no longer can there be inserted a godfather, brother or matchmaker.”

Fair enough.

However, the issue will be whether the senior industry specific professionals with a “serious international reputation” can be attracted – and the remuneration + package, is not going to be enough to do that on its own.

As any professional “headhunter” knows, money and perks have to be attractive, but the actual challenge of the job on offer also has to appeal.

Those that have previously been “headhunted” will attest to this being undoubtedly true.  Indeed, your author attests to it being true.

The question therefore arises as to the professional challenges that appeal to these specific international professionals – for the challenges that the Ukrainian companies face will not appeal to all who may be approached, dependent upon the parameters of the job role.

What is the aim of changing the management?  To insure more transparent dividends for the shareholders and nothing more?

How much of a free hand will any new senior international professionals have to restructure the businesses?  A restructuring that is drastically required.

Can they go through the supply chain like the proverbial dose of salts, reducing or increasing access to the supply chain, whilst undoubtedly annoying a few vested interests in doing so?  Is the supply chain “tiered”, similar to BP for example?  How broad should Tier 1, 2 or 3 be?  Is there a requirement of oversight for any subcontractors/suppliers to those appointed Tier 1, 2 or 3 suppliers regarding quality assurance?

Are they equally at liberty to go through the existing employees with the same proverbial dose of salts, considering many have been placed there through nepotism, rather than on merit?

Whilst corruption and transparency will undoubtedly be atop of the agenda for any new international management, is there scope for corporate expansion during their tenure?  Is there a need for reduction to core competencies?  Perhaps there is a desire to become more of a global player, and more actively tender/bid for international opportunities in due course?  Does the desire exist to act as a (minority or majority) partner in any global opportunities?

It would be foolish to waste the global relationships that senior international industry professionals bring with them, as there is much to be said for personal relationships and the opportunities they can (and generally do) bring.  Would the shareholders want to make that leap as and when such opportunities present themselves?

Whilst it may appear from Mr Yatseniuk’s words above, that Ukraine would be interviewing any serious professional international candidate, it would be rather naive to think of it that way.  The truth be told, it is very much vice versa – Ukraine will be interviewed by the candidates in line with their (primarily managerial) expectations, if they are to make the move from their current positions to those that are on offer.

To be very blunt, there will not be many serious international industry professionals interested in a managerial role confined to insuring that dividends are transparent and duly paid to shareholders.

If, however, the gauntlet is thrown down to turn these State entities into respected and competitive industry players, with a (more or less) free managerial hand to accomplish that, then top quality global candidates there most certainly will be – for the challenge presented would then certainly appeal to many.

Project Managers Wanted – Reforms Ukraine

It’s not often this blog advertises job vacancies – however these job vacancies are more worthy than most for some additional promotion, simply due to the fact that should those successful candidates succeed in fulfilling their appointed roles robustly, the author, together with the rest of Ukrainian society, is likely to benefit.

Despite this blog’s ineptitude at promoting job vacancies, it does appear that some websites are now being built in an attempt to fill that void – specifically in relation to what the DCFTA may or may not bring to Ukraine.

During July 2014, a Presidential Decree created the National Council and Executive Committee for Reforms.  In order to support it – or to be blunt, add the middle management and workforce to walk the talk of the enlightened thinkers – the Project Office for the Coordination of Development and Implementation of Reforms was necessarily born.

Having duly talked since July 2014, it is now time to walk.  Thus there are now vacancies for Project Managers, with an anticipated start date of late April/early May to insure the walk actually matches the talk.

Initially the roles are expected to last 12 months – although to be honest, it seems likely that the roles will be required to continue beyond a 1 year contract.  A wise candidate may anticipate at least another 12 month extension considering the scale of the tasks ahead.

The easy part will be providing defined coordination, analytical, and communications support, together with assistance in strategic planning reforms, responsibilities for the development of specific reform plans, and monitoring implementation.

(Getting things implemented and consolidated will be far, far more difficult than any planning.)

The Project Office naturally works in cooperation with the National Council and Executive Committee, but also with the EBRD – who will jointly assess candidates.

As to candidate abilities:

Project manager:

Coordinates the reform work of the Task Team

Develops Task Team reforms

Monitors and controls the implementation of the Reform Plan

Makes regular reports to the Reform Plan Manager and the public.

 

Experience:

A minimum of 3 years experience in managing complex projects.

Proven change implementation success.

Minimum of a Master’s Degree (or equivalent).

Fluency in Ukrainian and English – both spoken and written.

Strong communication and negotiation skills

Ability to build consensus.

Be able to handle large quantities of data.

Capable decision maker.

 

Project Areas:

Electoral legislation reform

Public Procurement reform

Anti-corruption reform.

Judicial Reform

Decentralisation of Public Administration

Deregulation & Business Development reform.

Law Enforcement reform.

National Security & Defence reform.

Health Care reform.

Tax reform.

Agriculture reform.

Education reform

Financial Sector reform.

Public Property reform

Energy (& Energy Independence) reform.

 

Thus, having such a large number of erudite and highly educated readers, many of whom undoubtedly would be able to meet the requirements above, it is now a matter of informing you of how to apply.

Interested parties, please email you resume, together with a 1 page covering letter outlining which area of reform you feel you are best suited to project manage, to pmo@apu.gov.ua no later than 7th April.

Naturally any of you that apply and whom are ultimately successful, as and when you find yourself in Odessa battling with the regional fiefdom, then meeting for a coffee and a chat would be delightful.

 

Total lustration? Not the best choice of words.

There is naturally a need to keep the public informed of the cleansing of the institutions of State when such a cleansing remains very much a demand of the Ukrainian constituency.  Indeed it would be very foolish not to publicise the fact that on-going cleansing continues, lest the public begin to believe that a return to the historically corrupt status quo is to be tolerated – despite all the rhetoric to the contrary.

However, there is an equal need to be brutally honest and manage expectations.

Yesterday saw a public statement by Zorian Shkiriak, the Acting Chairman of the State Service for Emergency Situations, claiming the total lustration of that institution, following more than 300 dismissals during his “acting” tenure.

Well, very good.

But more than 300 dismissals cannot mean the end to lustration within his institution.  Sacking more than 300 corrupt employees removes 300 corrupt employees – it does not remove the opportunities for corruption, and thus will not remove corruption for long (if at all).  There will undoubtedly be some corrupt employees that managed to slip through the net too.

As any green-fingered gardener will tell you, a quick sprinkling of “weed ‘n’ feed” deals with most of the problem weeds, although not all – and certainly not permanently.  It is a constant battle, for they grow back.

Thus as any anti-corruption drive has to be a continuing effort for as long as human beings are corruptible, it follows lustration cycles (and the checks behind them) will have to remain part of any such system for some time to come – even after claims of total lustration.  The hopeful outcome being that the numbers subject to mass dismissal are reduced each time, to a point whereby the numbers of corrupt are more effectively dealt with by way of criminal investigation and due process, rather than the current mass sackings of lustration in order to avoid overloading the (still corrupt) court system.

There is no silver bullet for corruption in Ukraine any more than there is a silver bullet for corruption in any other nation.

Greed is, after all, one of the seven deadly sins.  It has been around a long time, and it is not about to vanish from Ukrainian officialdom within Mr Shkiriak’s institution after one (brutal) round of lustration, anymore than it will in any other Ukrainian institution.

Corruption can be managed, and opportunities for corruption diminished – but it will not be removed.  There should be no such statements regarding “total lustration” within the  State Service for Emergency Situations (without simply closing it entirely),  or anywhere else, for having now generated the public perception of an entirely cleansed State institution, it will be a very public fall when the next case of corruption occurs within the  State Service for Emergency Situations – and that next case of corruption will undoubtedly occur, despite the best and most genuine of efforts, by Mr Shkiriak.

With corruption, it is probably better to provide a positive (where appropriate) progress report for public consumption – but nothing more definitive than that.  “The first round of lustration has been completed” would perhaps have been a far better expression to use.

As all gardeners know, those once thought destroyed weeds have a habit of growing back – aggressively.

Getting the money back – Ukraine

Somewhat belatedly perhaps, by Presidential Decree, President Poroshenko yesterday created the “Inter-agency Working Group on Coordination of the Return of Funds, Received in a Criminal Way by Former Senior Officials, to Ukraine.”  Imaginatively titled, all would agree.

Surprisingly for a presidential decree – or indeed anything generated entirely within domestic Ukrainian politics – there is a finite time limit to produce results.  The inter-agency working group has been given two months to complete its task.  Tuesday 26th May, when time expires, noted in many diaries undoubtedly.

Deputy Prosecutor General Vitaly Kasko will head the team comprised of Deputy Head of the Presidential Administration Andrei Taraov, the 1st Deputy Head of the SBU, Head of the Main Directorate for Combating Corruption & Organised Crime Control, Central Security Service Yuri Artukhov, Deputy Foreign Minister for European Integration Elena Zerkal, Deiputy Head of the State Service for Financial Monitoring of Ukraine Vitaly Zubri, Deputy Interior Minister, Head of the Main Investigation Department Vitaly Sakal, Deputy Prosecutor General David Sakvarelidze, Deputy Head of the Foreign Intelligence Service of Ukraine Volodymyr Sinkevich, Deputy Head of the National Bank of Ukraine Yakov Smoli, and Deputy Minister of Justice Anton Yanchuk…….and friends.

A lot of Deputy Heads – and notwithstanding the numerous very dodgy domestic “deals” for domestic assets during the period of “The Family” regime – all with existing job descriptions that would point to a heavy bias toward looking at Europe and assets therein, first and foremost.

Their two month mission has two tasks.  The first is to be extremely creative, engage in clever thinking (and enlightened conversation with their European counterparts undoubtedly) to arrive at mechanisms to return the assets stolen by the previous nefarious regime to Ukraine.  The second task is to identify any legislation that prevents any such return easily, and suggest amendments to domestic statute that would smooth the path to State repossession.  Perhaps GRECO can lend a hand with the latter.

Nevertheless, the clock is now ticking within an identified, and short, timescale – most unusually for Ukraine.

That raises two possibilities as to why there is such a short time frame – for it is surely not about to become standard practice for presidential decrees of presidentially created working groups – or Ukrainian politics in general.

The first possibility is that the Europeans have told President Poroshenko in very blunt terms, that the current freezing of assets under the auspices of “personal sanctions” cannot remain forever thus.  A message has perhaps been passed that any further longterm freezing will require some form of legitimate criminal investigation of which the Europeans are reasonably convinced is justified, and have a chance of success in any judicial process.  In doing so, as is always the case with technical fraud and money laundering cases, it can then take years before assets are unfrozen pending the conclusion of any due process.  Alternatively, if assets can be returned swiftly(ish) when the evidence is clear-cut.

The second possibility is that President Poroshenko (and the Cabinet of Ministers) is well aware that societal support for both executive power branches, is eroding rather rapidly – mainly due to the economic situation in the country, but aggravated by a perceived lack of timely reforms.  This is one of several reasons that for the past few months, there have been several mentions of a Cabinet reshuffle in the blog – an attempt to re-energise public support for the President and a new-look Cabinet of Ministers.

There are no serious domestic political rivals to President Poroshenko, or the current majority Rada coalition.  The Opposition Block and People’s Will regurgitations of the Party of Regions remain extremely toxic within the Ukrainian constituency (notwithstanding most of their traditional voter base is either annexed by, or now controlled by, Russia).  The biggest political threat to both President and Cabinet of Ministers is the lack of energised public support in the run up to the local elections due in October – for those that win will benefit from the decentralisation/devolution of powers to the provinces that are expected by the year end.  Something of a disaster awaits if those who don’t vote, either out of apathy, or to make a political statement by abstaining, outnumber those that do.

Without that energised public support associated with President Poroshenko until recently – or indeed to avoid guilt by association to the President – it is perhaps why “Block Poroshenko” is now in the process of re-re-branding back to its original “Solidarity” name.

To re-energise public opinion, both President and Cabinet need to either accomplish some populist achievements – such as repatriating a lot stolen State wealth, or deliver tangible reforms that will be both seen and felt by society, that will in part, mitigate the economic situation.  In the absence of either, and perhaps it is now to late to avoid anyway, a major Cabinet reshuffle is the only other option that may achieve a general and broad re-energising of the Ukrainian constituency.

However, should the newly created  “Inter-agency Working Group on Coordination of the Return of Funds, Received in a Criminal Way by Former Senior Officials, to Ukraine” manage to actually find a way to swiftly repatriate stolen State wealth, there remains the matter of preventing it being stolen once again.

Nevertheless, it will be interesting to see what enlightening cleverness this working group can generate within the next two months.

Into the perceived Kolomoiski vacuum – Ukraine (and Odessa)

Following the resignation of Igor Kolomoiski, and its acceptance by President Poroshenko in the early hours of this morning, whom and what overtly fills the political/power vacuum will no doubt be the subject of both speculation and analysis.

As previously written, some time ago, Mr Kolomoiski is (and remains) the last true oligarch worthy of the name – pending the unforeseen comeback of his peers:

“He financed volunteer brigades as well as directly funding the Ukrainian army when political leadership was in disarray. His prima facie loyalty to the nation resulted in him being appointed as Governor of Dnepropetrovsk.

Mr Kolomoisky has also inserted friends and acquaintances in other positions of power when Ukraine was politically reeling from Crimean events and those that followed – the Odessa regional governor is an example.  He also part funded the Odessa Mayor’s campaign.  Indeed, Mr Kolomoisky de facto controls everything from Dnepropetrovsk westwards in southern Ukraine when it comes to local government.

Mr Kolomoisky financially backed several political parties in the RADA at the last October 2014 elections, as well as the president’s election campaign.  He also financed numerous “independent MPs”.  Thus his political power is not dependent on holding any office.

There is no need to write reams relating to his control over significant percentages of Ukrainian GDP, or his control within several strategic sectors of the Ukrainian economy.”  

The emboldened sentence is to be remembered whilst this entry continues, for it is extremely unlikely that Mr Kolomoiski will disappear from (the puppetry behind the curtain of) Ukrainian politics – just as he was always active prior to becoming the Dnepropetrovsk Governor, so it seems likely he will continue now.

Indeed, now that he once again holds no political office, and therefore once more has no public political face to present, he may well become far more mischievous than when he was holding office.  The number of “owned” Rada MPs, the occasional Mayor, and deputies in numerous local administrations from Dnepropetrovsk to Odessa, insure that his ability to politically influence from behind the curtain continues.  This method has traditionally always been Mr Kolomoiski’s preferred modus operandi, having previously shunned public office.

There is also the longstanding rumour within the Rada, that both Messrs Kolomoiski and Lyvochkin/Firtash have decided to “reset” the Rada in 2016 – between them “owning” enough MPs to make the current Rada almost unworkable.  That may perhaps be mitigated by a Cabinet reshuffle, as alluded to here – or not.

That said, much depends upon any deal struck between President Poroshenko and Mr Kolomoiski in the early hours.  Perhaps an agreement to cast aside the political ambitions (if he had any) of Mr Kolomoiski in return for maintaining his business and economic empire?  Some form of grubby little deal was reached to end the public silliness, and unless the US has a sealed indictment it was prepared to unseal, ala Mr Firtash, should Mr Kolomoiski not decide to fall on his sword, a grubby little deal between these two men there certainly is.

Nevertheless, the perception of a power vacuum presents itself, most notably in Dnepropetrovsk’s Governor’s Office – though elsewhere also.

President Poroshenko has moved swiftly to appoint an Acting-Governor in Dnepropetrovsk – he has temporarily appointed the Governor of Zaporozhye, Mr Valentin Reznichenko.  However, prima facie it would appear to be little more than an act of desperation – no offence meant to Mr Reznichenko.

Mr Reznichenko has two major pluses as far as the President is concerned.  The first is that Mr Reznichenko was born in Dnepropetrovsk and is therefore a local – at least by birth.  No parachuting in of an otherwise “alien” Presidential loyalist required – even if few in Dnepropetrovsk will actually know who Mr Reznichenko is.  That said, when other household names from Dnepropetrovsk consist of the likes of Yulia Tymoshenko or Viktor Pinchuk, choices to replace the (in)famous Igor Kolomoiski with a similar “big name” are necessarily more than a little limited, if not politically impossible.

The second plus is that Mr Raznichenko is indeed a loyalist to the President – or at least he is a loyalist to, and long term friend of, Boris Lozhkin, current head of the Presidential Administration.  (However, President Poroshenko has known Mr Reznichenko for 15 years, according to the President in a statement when appointing him as Governor of Zaporozhye – “This man I’ve known for 15 years. He is strong-willed, effective leader who understands the problems of the economy.”)

Zaporozhye must surely be hoping for a similarly “qualified” replacement if Mr Raznichenko remains in Dnepropetrovsk – and Dnepropetrovsk must be wondering how effective a man whose career is entirely in media management will effectively replace Mr Kolomoiski.  The nation, perhaps, is wondering when there will be an appointed Governor whose “qualification” exceeds being a “friend” of the President, or “a friend of a friend” of the President.

Regardless, Mr Raznichenko has been chosen to fill the Kolomoiski power vacuum in Dnepropetrovsk – and it is unlikely that the vast majority of locals will create too much of a problem for him.  Problems, if they come, will come from the minority who see a weak Governor, and the remaining official, and grey, structures of Mr Kolomoiski (and perhaps Mr Pinchuk if his people regroup effectively with the passing of ex-Governor Kolomoiski).

In Odessa, however, the situation is somewhat different.

Igor Palitsa, long term friend and business partner of Mr Kolomoiski remains the Governor of Odessa.  However, as of two days ago, Mr Palitsa is now without Mr Kolomoiski’s “volunteers/paramilitary” patrolling alongside the local police.

The perceived weakening of Governor Palitsa’s (and by extension Mr Kolomoiski) power with the removal of these “volunteers” has immediately been seized upon.

As mentioned a few days ago, firstly, Mayor Trukhavov (albeit currently bought and paid for/rented Kolomoiski ally) is trying to speedily legitimise his “Municipal Police/Guard” via local legislation – despite no national legislation providing for Mayor Trukhanov’s extra-MIA/extra-Military entity in the city.  A small army/police entity reporting directly to, and directly controlled by, the city mayor – namely Mayor Trukhanov – is perhaps not the best of outcomes with a man long associated, by his own admission, with the Odessa Mafia.  He has enough “illegitimate groups” at his disposal already.

Yesterday evening Sergei Kivalov, one of the most despised, nefarious and untrustworthy characters in Ukrainian politics, announced on his Facebook page that with the removal of Mr Kolomoiski’s “volunteers/paramilitary” from patrolling alongside the police, several hundred students from his “Law Faculty” in Odessa would replace them:

“В связи с тем, что охранные структуры губернатора Палицы больше не помогают милиции обеспечивать порядок в Одессе, мы не можем оставаться в стороне. В Национальном университете «Одесская юридическая академия» существует целый факультет по подготовке сотрудников правоохранительных органов, в частности милиции. Хоть с завтрашнего дня мы готовы выделить несколько сотен студентов старших курсов, которые совместно с одесскими правоохранителями будут патрулировать улицы нашего города. Студенты факультета по подготовке следователей ОВД – будущие стражи порядка, которые уже на старших курсах университета имеют профессиональную практическую подготовку. У них достаточно опыта, чтобы войти в состав милицейского патруля. Естественно, все необходимо сделать официально, чтобы потом всякого рода провокаторы не кричали на каждом углу о «титушках из Юракадемии». Последнее слово – за руководителями областной и городской милиции. Не стоит забывать, что мы живем в сложное для страны время. Сейчас, как никогда, нужно быть начеку в связи с участившимися взрывами в нашем родном городе. Безопасность одесситов превыше всего.”

As is his habit to misuse his students during electioneering via coercion or bribery, undoubtedly he can be no more trusted in his motivations in the use of his students when “policing” the city either.

Yesterday also saw the pro-active launch of “Operation Porto Franko”, mentioned here almost two months ago.

“……in Odessa, there are indeed seeds being sown over the past few weeks for a project amongst the conspirators, called “Porto Franco”.  In the past 3 weeks, a good deal of money has arrived in Odessa for the promotion of this project when the time to activate it arrives.

Those behind it are the usual political suspects – Messrs Markov (from afar), Presman, Skoryk and Rabinovich.  Their aim is to give Odessa a special status in Ukraine as a free port – as the name “porto franco” infers.  The remnants of Party Rodina are preparing to be activated (now the money is here). Trolls for the “Odessa Forum” and on-line media are being recruited.  The local media owned by these men is prepping to make the “porto franco” argument  A Bill to be submitted to the RADA seeking a special free port status for Odessa is being drafted in dark conspiratorial corners.

The motivations of these conspirators is naturally not the benefit of Odessa.  The special status has far more to do with yet more nefarious enrichment and far less accountability to Kyiv.  Defrauding and shameless theft of the decentralised Odessa budget sits atop the agenda.  Some of these men are also close to the Kremlin, and thus would have little compunction if the porto franco project was (mysteriously) co-opted by the SVR and GRU along the way.  The money that has arrived in Odessa over the past 3 weeks to finance this project is not theirs – despite them all being obscenely wealthy and capable of financing such an effort.”

Unsurprisingly, within 48 hours of Mr Kolomoiski’s “volunteers” leaving the city, Alexei Tsvetkov, via Igor Markov’s Timer media outlet, announced a pro-active “education campaign” regarding “Porto Franko” – inferring the absence of the “volunteers” now provided the right opportunity to do so.

In short, the Odessa ex-Regionaires, within 48 hours of perceiving a Kolomoiski vacuum, and/or weakening of Igor Palitsa as Odessa Governor, are wasting little time in overtly testing the political waters and strength of resistance therein.  If there be no resistance, giant leaps backward beckon for Odessa if those in Kyiv are not watchful and picking up on these little revisionist (or worse) indicators.

Remember the Anti-Corruption Bureau?

The on-going, seemingly glacial effort at a functioning Anti-Corruption Bureau has not been mentioned at the blog since the end of 2014.

Time, perhaps, for an update, although there is sadly little to update as is the case with glacial movement.

The National Anti-Corruption Bureau was supposed to be already operating by now.  It’s legislative legitimacy for existence coming into effect in January 2015.  It is an entity that is supposed to employ approximately 700 staff, and yet it is still to fully recruit, or even be given its appointed “head”.  This due to a very long and highly convoluted process that surrounded the selection of the committee in charge of candidate selection, and thereafter (hopefully) thorough checks for nefariousness of the 3 candidates that will ultimately be put before the President to make a final appointment.

Indeed, whilst the President is stating he is not interfering in the process – he is making public statements that he would like the process to be somewhat more timely.

Of the initial 176 candidates that showed some interest, after several rounds of sifting, 4 candidates remain – Yakov Varychev, Mykola Siry, Artem Sytnik and Viktor Chumak.  One more to fall by the wayside prior to the final 3 reaching the President.  However, with 700 staff to employ, it would seem rather erroneous not to employ these 4 heavily vetted candidates somewhere within the hierarchy of the new NACB anyway.

Messrs Varychev and Sytnik are former investigators for the PGO in different  regions of Ukraine, Mr Siry is/was a lawyer for Ms Tymoshenko, and Mr Chumak is an MP within the President’s party.

Whilst it seems very likely that the selection committee – each member selected at extraordinary lengths for their moral and ethical fortitude – has not been “political” in its robustness in candidate selection, verification and investigation, it seems unlikely that there will be no absolute absence of political influence in the President’s decision.

Whilst the President may well be delighted to see all remaining candidates within the hierarchy of the new NACB, (at least one hopes that would be so), it is difficult to see him appointing anybody connected so closely to Ms Tymoshenko to the very top job, unfortunately for Mr Siry.

Perhaps a provincial former PGO investigator would be the most politically neutral decision.

However, only a fool would bet against the appointment of Viktor Chumak from the President’s party – and despite the numerous, labourious, and a-political checks and interviews he will have been through to get thus far, some will still smell nepotism if he is appointed.

Whatever the outcome, as things stand, there remains no fully functioning Anti-Corruption Bureau, nor “Head” thereof – 3 months after it was expected to begin its role.  As the days, weeks and months pass by, the pressure to get a few notable results for any new “Head” before the year end grows – particularly when the President, even if he already knows whom he will appoint from the remaining 4 candidates, will have to be seen to spend the appropriate amount of time “pondering” before making his appointment.

Questions therefore – April, May or June before a “Head” is appointed for the NACB?  2015 or 2016 before it is fully staffed? 2, 3 or 4 NACB successes before the end of 2015?

All over to Avakov and the MIA? – Law & (dis)Order, Odessa

In an interesting day for Odessa relating to law and order – and its enforcement – two developments of note have occurred.

The first development is the removal of the security structures in place in Odessa since 6th May 2014 by order of President Poroshenko.

From 6th May 2014 until yesterday, the local militsia/police were accompanied by “volunteers/paramilitary/” trained and equipped, under the pretense of insuring the local community and police rubbed along together fairly well in a post “2nd May 2014 Tragedy” environment.

The cold facts, however, were that whilst the “quasi-civilian/paramilitary minders” that accompanied the police albeit kept the police on the (fairly) straight and narrow, far more importantly, they were there to insure the loyalty of the police to Odessa and Ukraine.

The police seen by many in Odessa as having failed spectacularly on 2nd May 2014 at best, and at worst having sided with, or tacitly allowed, the pro-Russian elements to shoot dead numerous pro-Ukrainian protesters in the prelude to the Union House disaster, during which they were equally incompetent and/or colluding – depending upon your point of view.

With Mr Kolomoisky’s friend and business partner Igor Palitsa being Governor of Odessa, and having control over the “volunteers/paramilitary”, de facto Mr Kolomoisky has a (very) small patriotic army at his disposal in Odessa via Mr Palitsia.  Indeed, there are no prizes for guessing who equipped these people and therefore where some loyalty lay.

That, however, changed as of yesterday.  Undoubtedly not due to a change in the security threat to Odessa, but as a result of the on-going shenanigans surrounding Ukrnafta in Kyiv and “private security guards” on Mr Kolomoisky’s payroll “protecting” certain buildings were his current management team are under threat of replacement by the State.

(Indeed Igor Palitsa, the current Odessa Governor was Mr Kolomoisky’s chosen head of Ukrnafta until 2007, when he then entered politics as a Rada MP.)

As was predicted here many times over the past few months, the State and Mr Kolomoisky were heading toward a power game collision – a game that has now been joined.

Thus it has come to pass that as of yesterday the “volunteers/paramilitary” patrolling with the police no longer operate in the city – as confirmed by the Governor’s advisor Zoe Kazanzhi:

“I’ve talked to the Chairman of the Odessa Regional State Administration Igor Palitsa. I confirm and am authorized to report: all security structures, which from May 6 2014 in Odessa, maintained law and order, today are excluded from these processes, and have left the city.”

Thus, it’s over to Mr Arsen Avakov and Ministry of Internal Affairs alone then – despite the fact that no effective lustration has occurred within any Odessa MIA, with many remaining within the ranks that hold dubious allegiances.   It has to be said that many in Odessa look to events and security in Kharkiv, a city where Mr Avakov has a strong history and a good deal of personal power, and were more than pleased to have Mr Kolomoisky’s people acting as “volunteers/paramilitary” in joint patrols with the police of Odessa, insuring their allegiance to Odessa and Ukraine.

Rightly or wrongly the perception held by many has been that Mr Kolomoisky was, and is, far more reliable than Mr Avakov or the State in providing security for Odessa.

However, Mr Avakov and the MIA – perhaps fortunately – are still not left alone to provide the law and order for Odessa, even though he may well think that is the case.  Not having visited the city, like so many from Kyiv that really should, some may wonder if he (and others in Kyiv) really know what is going on here.

This brings us to the second development – which will be a realisation of what is happening in Odessa by those in Kyiv.  Mr Avakov and the MIA are not alone in policing Odessa – they also have the “Municipal Police/Guard”, created by the truly nefarious Mayor of Odessa, Gennady Trukhanov, that for some time has also been policing the city and enforcing the rule of law.

The problem being, that whilst the Mayor’s “Municipal Police/Guard” may be enforcing the rule of law, there is actually no legal basis for Mayor Trukhavov’s Municipal Police/Guard to do so – for there is no existing statute that either creates or recognises a “municipal police”.  The “Municipal Police/Guard” answering directly to the nefarious Mayor.

Ergo Mayor Trukhanov’s “Municipal Police/Guard” is in fact illegal and devoid of any statutory right to exist – and thus any statutory power to enforce the law (over and above the legal powers held by any citizen of Ukraine).

Indeed Mr Kolomoisky’s “volunteers/paramilitary” that patrolled with the Odessa police had, until yesterday, more legal foundation than Mayor Trukhanov’s “Municipal Police/Guard”.  Whilst the “volunteers/paramilitary” may have now all gone and/or disbanded, Mayor Trukhanov’s “Municipal Police/Guard” will continue to work tomorrow, next week, and into the future, enforcing the law in ways that they are not empowered to enforce it – because nobody from Kyiv ever comes to Odessa to notice such things.

Quite how the people of Odessa would rank who would look after their security most effectively would be interesting – though there would be few surprises to find Mr Avakov at the bottom of the list of three – behind an over-sized oligarch and mafia Mayor.

If the bombings within Odessa increase dramatically, (be they false flag, more settling of business scores under the veil of “terrorism”, or indeed genuine “pro-Russian” sponsored/driven events), Mr Avakov, and by extension President Poroshenko, will continue to lose political capital in Odessa.

Nevertheless, at some point (and with Mr Kolomoisky flexing his “paid for/hired” muscles in Kyiv currently, that point seems to have arrived), the issue of law enforcement had to be exclusively returned to the MIA.

Whether, perhaps, it may have been better received in Odessa after any roll-out of a new police service similar to that currently under way in Kyiv – complete with transparent recruiting etc. – is now somewhat irrelevant.

The legitimising or removal of the Mayor Trukhanov’s “Municipal Police/Guard” will need to be dealt with sooner rather than later, lest a queue of “wrongful arrests” hits the judicial system too.

However, it remains a sad state of affairs when the only 100% legitimate law enforcement/security entity ( the MIA and its leader) will be seen by a great many in the city as the worst, and least effective, of the 3 options that were providing law enforcement in the city up until yesterday –  especially so when the perceived security environment has not improved to the point that abandoning the “joint patrols” will fill many in Odessa with confidence.