Archive for July 12th, 2017

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Reflections on a conversation – Ukraine

July 12, 2017

A few days ago and old friend of the blog was in Odessa.  This old friend being a long time Brussels operative involved in many things such as justice and historical expansion of the EU itself.  In short an experienced old hand with “eastern European reform”.

As is always the case with the blog, only the author’s talking points will be made public.  The views of the other party, whether agreeable or disagreeable, remain subject to private conversation.

The conversation turned to where Ukraine is currently “at” and the prospects of further reform.

Here it is firstly necessary to acknowledge the difference between policy and reform, and secondly the current and very obvious stalling of reform in Ukraine.

By way of example of the difference between policy and reform a reader can look at the impressive actions of the NBU over the past few years – for that is a result of policy (more or less) effectively implemented – and yet that can nevertheless be reversed or deviated from at any time.

Reform is structural, it is process, it is (eventually) consolidated, and it is (ultimately almost) irreversible (with any ease).

As such the judicial reform has already set off along a poor path as the structure and process behind what will result will not lead to a truly independent judiciary staffed by morally upstanding and individually independent judges.

The Prosecutor General’s Office will also never convincingly reform whilst ever it is run by a politician (and Yuri Lutsenko was, is, and will always be a politician) and any eventual structure and process reform is likely to leave this institution beholding to those in power.

The reason being that those historically and currently in power simply cannot find it within themselves to surrender the prosecutors and judiciary to genuine independence.  The sword, rather than the scales, seem likely to remain the preferred tool of the State.  For my friends anything – for everybody else the rule of law.

It is the system that breeds and retains loyalty, and loyalty rather than ability is the most cherished of commodities in a patriarchal system that still exists in Ukraine.  The current President is far more PR savvy than any previous president and in fairness he is more prone to allow, accept, and promote change where the personal and vested interests of those most critical in the power structure are least damaged.  Where they will be significantly affected there is generally a noticeable time period whereby those personal or vested interests can adjust, or routes to circumvent can be positioned.

A swift glance at any potentially successful presidential candidate in 2 years time presents at best little, or more realistically no hope, that these two critical institutions will  be allowed anything approaching genuine independence.

Thus, despite the blog stating upon his election that President Poroshenko should be a single term president – in the absolute knowledge that once low-hanging reform was harvested and what was left would push against the interests surrounding the president therefore stalling reform progress – quite clearly the prospect of a populist president such as Tymoshenko would probably be as bad – or more realistically worse.

As of the time of writing, for the record, opinion polls would not put much between Poroshenko and Tymoshenko currently leading the names associated with a presidential run – ergo populism is currently not the greatest internal threat to Ukraine – continued corruption and the weak grip upon the rule of law over the next two years is.

Among much pending and critical reformist legislation, health, education, labour/employment, judicial, etc., and not withstanding almost entirely illegitimate entities such as the Central Election Commission where only 2 of 15 members have a current legal mandate for their role – 13 members still serving despite mandates long since expiring –  with elections but 2 years away for president, parliament and many regional mayors, the much promised reform of the election law begins to rise to the top of the agenda, becoming an immediate priority.

If ever there is to be a critical mass of reformist parliamentarians within  the Verkhovna Rada, the issue of opening the currently closed proportional representation party lists simply has to be addressed.

By way of example, it is not the people of Odessa alone that give a parliamentary mandate – with full immunity and impunity – to odious characters such as Mykola Skoryk.  He does not stand in a single mandate, first past the post electoral seat, because he would not win.

The Opposition Block (and before that Party of Regions) place him sufficiently atop the party list in the knowledge that when the party passes the national 5% threshold he, as Messrs Firtash and Liovochkin’s chosen black hat and master of dark arts in Odessa, will be able to continue to act as such with full parliamentary immunity and impunity.  There are certainly, if not entirely morally upstanding, those within the Opposition Block from Odessa that would act a little more in the interests of the constituency and a little less in the interests of Messrs Firtash and Liovochkin that will not be given a high ;position on the party list.  The problem being the electorate cannot choose between Mr Skoryk and others from the party list when voting along proportional representation lines as the electoral law currently stands.

It is the same for all political parties.

The leadership simply places the same nefarious (but otherwise sufficiently loyal and/or useful to the party leader) faces atop their party lists in the full knowledge that most will be reelected when passing the 5% threshold due to a lack of voter choice among the names on the party list.

Electoral law should be changed with more than sufficient time for the (currently illegitimate) CEC, voting constituency and judiciary (and election observers) to understand the changes.  A few months prior is not sufficient time.  12 months is probably a minimum to reasonably expect any questions arising from legislative changes to be asked and answered and properly disseminated.

In the meantime, perceived attempts at forcing through reformist legislation will continue during 2017, despite pre-election electioneering undoubtedly beginning in the Autumn.  Pension reform will probably make it.  Land reform probably will not.  Education and health may – but also may later be neutered by amendments either wholesale or piecemeal.  ATO will legislatively change to “temporary occupied territories”.  Judicial reform will continue at a snail’s pace and along a poor path due to the structure and processes behind it.  No “big fish” are likely to go to jail in 2017.  No major investigations into high profile murders or violent events over the past few years are likely to see arrests and detention among the elite where any part was played.

IMF leverage is effectively reduced until at least the middle of 2018 when Ukraine will have to begin to prepare to repay international debts due in 2019 – and if Ukraine successfully returns to the capital markets at the end of 2017/early 2018, perhaps IMF leverage is now permanently reduced.  Other western levers will have to be found and skillfully used to force reform in areas where the current leadership would prefer to drag their feet.  With Ukraine having achieved Visa-free and the final ratification of the Association Agreement (and DCFTA) other carrots may have to be found, but certainly bigger sticks too – and perhaps forcibly employed.

As the parliament ends its final plenary week before the summer holidays and parliamentarians head off to exotic beaches, there is much to ponder regarding how to motivate them upon their return in the Autumn – not withstanding actually effective implementation of those legislative changes.

That said, despite everything Ukraine continues to at least face, and indeed glacially travel in the right direction.  The fundamental question is perhaps more one of whether the current leadership has dropped anchor and is not prepared to go too much further due to ever decreasing space surrounding personal and vested interests, or in fact if it is actually now noticeably heading in the wrong direction behind the curtain despite the nation going in the right direction in front of it?  Just how much room remains to continue upon current trajectories before one finally stops the other?

What then to do about it if that is so?

If the current leadership are to win another (and in the case of the president a final term), will the decision be to reinvigorate reform and go out on a reformist high forever inscribed in Ukrainian history for taking Ukraine far further along its current trajectory – or will it “dig in” to protect its interests until the very last?

Alternatively if electing a populist, how swiftly will that be equally rued when flailing about giving the constituency what they want, and not necessarily what they need, takes the nation no further forward, and perhaps into reverse?

This all probably reads as particularly pessimistic – but there are many possible futures and there are many actors that can shape them, the most critical domestic actor remaining civil society.  Things can always get worse, but they can also get better.  What cannot happen  is that things remain the same.

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