#23_1-8

4
No.23 APRIL 12, 2018
TOPIC OF THE DAY
WWW.DAY.KIEV.UA
By Ivan KAPSAMUN,
Alla DUBROVYK-ROKHOVA, The Day
Obviously, Ukraine is a rich
country, but its resources
must not be squandered
endlessly, when the country
is not being modernized.
We decided to put this idea into the
theme of a roundtable with experts at
The Day’s editorial office. The problem
is that Ukraine has already approached
a certain Rubicon today in the economy,
in the dynamics of migration from
this country, in the degradation of the
political system, and in the number of
diplomatic defeats. In other words,
the continuing rule of the country by a
group of oligarchs, who only care about
their own interests and guided by their
own rules, poses a threat to the very
existence of the state. The next year,
2019, is a year of the presidential and
parliamentary elections. And oligarchs
are already preparing their scenarios
that involve political projects, the mass
media, hyped-up leaders, financial
resources, etc. And what should we,
society, get ready for? Our guests are
political scientist Viktor NEBO-
ZHENKO; Oleksandr SOLONTAI,
expert at the Institute of Political
Education; political consultant Taras
ZAHORODNII; and Anatolii AMELIN,
cofounder of the Ukrainian Institute of
the Future. First of all, we requested
the analysts to answer the basic
question: “Is the oligarchic scenario
over? What next?”
● “THE SYSTEM WILL BE
DISMANTLED WHEN
A PARTY TOTALLY
INDEPENDENT OF
OLIGARCHS ENTERS
PARLIAMENT”
Oleksandr SOLONTAI: “In my opinion,
the oligarchic agenda has not yet
been exhausted. The system is alive and
kicking. We are constantly saying it’s
necessary to break the system because it
is a demand of society. But, as a matter
of fact, there has been not a single serious
attempt to break it. We can, for example,
recall the times of Viktor
Yushchenko, when one of his first steps
was to begin a dialog with oligarchs, not
to mention how many oligarchs stood behind
his victory. Moreover, we have an
oligarch, Petro Poroshenko, who became
president. And, naturally, he will
not be eliminating himself and other oligarchs.
All his statements about deoligarchization
are mere words.
“Oligarchs have long been posing a
threat, and not only to the state. We have
begun to lose our territory in the past few
years, and before that, we had been losing
millions of the population, and this
tendency continues. It became clear
from the 1990s onwards that public administration
‘in the manual mode,’ absence
of civil society control, and participation
of the grassroots in the government
resulted in Ukraine dying out
at a rapid rate. When we went through
the first crisis of privatization, the formation
of property, and the collapse of
the USSR, we, instead of becoming a nation
of small and medium entrepreneurs,
became a nation of the clan oligarchic
system. The fact that this country
has lost some of its borders has not
stopped them.
“On the other hand, not only oligarchs,
but also some groups of owners
have formed since the 1990s. Their
number is so far not critical enough to
radically influence the state, but they are
sufficiently active to be noticed. They are
owners of private businesses and implements
– from craftsmen to farmers.
These people are seeking a job abroad and
own here cars, buildings, plots of land,
retail outlets, and office centers. A simple
example is IT people – they own
what was made in the conditions of
Ukraine and is not linked with oligarchs.
Moreover, we have medium-scale business
which was not created in classical
oligarchic ways. We also have businesses
that are part of the European and
global structure. But they are all too few
to upstage the oligarchy.
MARCH 29, 2018
The Day’s experts on four variants of developments
“This is also not enough for a non-oligarch-sponsored
political force to appear
in parliament. I set it like a goal to myself,
answering the question ‘What
next?’ before the oligarchic system is dismantled.
For it looks like the whole
Ukrainian government is divided into
‘pieces’ belonging to Poroshenko,
Akhmetov, Kolomoiskyi, Pinchuk, et al.
In other words all of these pieces belong
to concrete oligarchs, not to societal
groups. So, we will be able to speak seriously
about removing the oligarchic
system only when a political force totally
independent of the oligarchs and adhering
to the principle of classical politics
– serving the interests of a large
number of people, not of one, two, or
three persons – appears in parliament.
I think it will be possible to begin changing
this system in 2019, the year of presidential
and parliamentary elections.”
For such a party to enter parliament,
there should be concrete mechanisms.
Who is supposed to create these
mechanisms, when our parliament is oligarchic
now?
O.S.: “Citizens. They must unite –
those who aware that oligarchic policies
are destroying the country, sucking the
financial lifeblood out of it. Such citizens
should unite into a party. This is the subject
of my research. Incidentally, I do not
think that changing the election law is
an obligatory condition for this kind of
party to enter parliament. The condition
is the number of people who will unite on
the basis of supporting this force in
parliament.
“What can hinder success in the future?
The attitude of Ukrainians – they
think politics is unfair and wrong and,
hence, do not go into it. The second obstacle
is the fact that those who could be
society leaders go to serve oligarchs. The
third danger is economic impoverishment,
when Ukrainians are so poor that
they find it hard to donate 200-300
hryvnias, a small amount, in the conditions
of total mistrust.
“I think these risks are more dangerous
than the electoral system. Under
any electoral system, one can win or see
total rigging and substitution of the elections
with money auctions… Replacing
the current first-past-the-postproportional
system with one based on
open lists will not, unfortunately, solve
the problem of buying votes. But, of
course, I would only welcome if there
were not two different ballots, but one.”
● “FOR THE FIRST TIME
IN 26 YEARS, THERE IS
NO LONGER SUCH
A POWERFUL WAY
OF HUMILIATING UKRAINE
AS AN OLIGARCHIC
CONSENSUS”
Viktor NEBOZHENKO: “We are
all saying there is a clear growth of intolerance
to the oligarchic form of
governance. But what also matters is
the opposite – oligarchs do not know today
what to do. This is the first time I
can see a strong depolitization of oligarchs.
I thought for some reason that
Pinchuk, Akhmetov, Firtash, and others
are good politicians, but in reality
they are not – not even geopoliticians.
Their geopolitics boils down to guarding
their property and having a good
time. They do not feel geopolitics and,
accordingly, the country.
“Who are the enemies of oligarchs
in addition to the honest Ukrainian people?
It is, above all, multinational companies.
They do the same as the oligarchs,
but they just apply different
methods of transferring money abroad.
But this amounts to a conflict. Another
rival of the oligarchs is the Ukrainian
bureaucracy. They have also got
tired in the past 20 years of the following
fact: as soon as one of them becomes
a minister or a deputy minister,
an oligarch’s ‘envoy’ knocks on their
door. One more thing: the oligarchs
have come across what they did not expect
– Russian aggression. And a war,
especially a war of defense and liberation,
requires the qualities they do not
have. So, they were taken aback.
“When we are speaking about what
we can do with oligarchs, we must begin
with the courage of a politician who has
become – by chance or owing to natural
circumstances – the leader of the country.
The first thing he must do is to make
oligarchs and Ukrainian society strike
a deal that sets certain rules: you steal
no more, and we touch you no more. Otherwise,
there will be an appeal to the international
community. The West is
also dissatisfied with Ukrainian oligarchs
who think they are the hub of the
Photo by Artem SLIPACHUK, The Day
“Is the oligarchic scenario
over? What next?”
universe. They think the ‘frozen 1990s’
are still around, which is very bad.
“In reality, for the first time in
26 years, there is no longer such a
powerful way of humiliating Ukraine
as an oligarchic consensus. The questions
of who should represent the oligarchs,
which way Ukraine must go,
and what is to be done during a world
crisis remain open. It all began when
one politician-oligarch arranged with
another oligarch that he would seize
power at the expense of the rest of oligarchs
in Ukraine. In other words, it all
began with the ‘Vienna conspiracy’ of
2014. And now they do not trust each
other, they do not even have a place to
meet and make a deal.
“They themselves created another
problem which arose during the crisis
of the oligarchic regime. As is known,
the source of oligarchy is not only
proximity to the government, but also
corrupt ties. It turns out that the main
enemy of Ukraine is not authoritarianism
and diminution of democracy but
total corruption. Here I do not believe
in moral decisions – we are not the
Czech Republic or even Poland, where
the Polish church participated in supporting
the moral-political spirit. We
don’t have these mechanisms, but they
will come. Note that only one major oligarch,
Kolomoiskyi, made a statement.
He took a political step after the Euromaidan.
The other ones did not support
him. This is why there is no oligarchic
consensus, but oligarchy still
exists. It cannot reincarnate itself because
the country itself is weak.”
● “2019 MAY BE A RUBICON”
Anatolii AMELIN: “The classical
theories of oligarchy assume that the
oligarch is not just a businessman but
a mixture, a fusion of the government
with business. There was a Rubicon in
2014, when the oligarchic class felt uneasy
about the likelihood of serious
changes in conditions and new rules of
the game. But there was no entity that
could guarantee these new rules. The
Constitution defines the president as
guarantor, but our president is the
same oligarch – only in better conditions.
The development rate of Roshen
stores several times exceeds that of the
Ukrainian economy as a whole. So,
there was really a demand for common
rules in 2014, there was a Hyatt conference,
as you remember, but the oligarchs
failed to come to an agreement.
“Why do oligarchs invest in the media
and politics? Because the media is
an instrument for influencing politics,
while politics is an instrument for
protecting oneself and one’s business,
as well as an opportunity to cash in. The
absence of common rules forces oligarchs
to go into politics to protect
themselves because this country has no
other systems of rules and protection.
Oligarchy exists today, and we are not
on a Rubicon. We are in an active
transformational phase. 2019 may be a
Rubicon because peak payments of the
foreign debt fall on that year. But
there are no resources for payments,
which creates a great likelihood of default,
which in turn entails impoverishment
of the populace, devaluation of
the national currency, social protests,
etc. Should the economy overcome this
Rubicon successfully, this will present
a chance for Ukraine. If not, we may
face a new revolutionary cycle, which
can result in not so much the loss of
statehood as in changes in its forms. It
is only possible to cross the Rubicon
successfully if there are rules and
guarantees of obeying them, if there is
a guarantor himself.”
● “THE STRUGGLE AGAINST
OLIGARCHS MUST NOT
TURN INTO A STRUGGLE
AGAINST NATIONAL
CAPITAL”
Taras ZAHORODNII: “The state is
running short of resources for oligarchs
who are thirsty enough to support
the system that has existed on the
vestiges of the Soviet past. Rent is
falling, and their attempts to preserve
this system, which ensures the profits
they customarily make, no longer succeed.
So the dilemma is: either you begin
to play by different rules or you just
disappear. The main sign of a coming
crisis is that the populace begins to flee
the country. And the resources of the
Soviet infrastructure are running out.
“On the other hand, we must remember
that the struggle against oligarchs
must not turn into a struggle
against national capital. The common
cliche is that Ukrainian oligarchs are
bad but foreign business is transparent.
But as soon as the question of taxing the
flight capital was raised, it turned out
that the most outspoken opponents of
this tax were foreign companies. Therefore,
no matter what attitude we take to
our oligarchs, they at least maintain
some infrastructure that produces
something, whereas foreign companies
in fact offer us a raw-material way.
“We are all aware that 50 percent of
the Ukrainian economy is in the gray
zone. So we need, so to speak, a confidential
deal – you return the money, and
we leave you alone; you reinvest the money,
and we introduce the same rules of
the game for all. One of the options can
be the example of Kazakhstan which has
introduced a dual system of jurisprudence
by inviting British judges who will
handle all economic cases. I think there
could be a compromise here. I know
that nobody trusts anybody because
everybody is accustomed to using the
state machine in his own interests and
every country has a judiciary of its own.
So, it is worthwhile to reach a compromise
– to bring Britons here, who will be
our arbiters. Kazakhstan chose not to restructure
its system of law radically.
They said: business is above all for us,
and disputes will be heard in this court.”
V.N.: “If the updated judicial system
of Kazakhstan works at last, I
would not ‘deal’ with Ukraine today, if
I were Putin.”
T.Z.: “The main problem in Ukraine
is not taxes or corruption but unstable
ownership rights. Why do oligarchs
transfer their assets abroad? Because
they know: if ownership rights are unstable,
your property can just be taken
away. And Kazakhstan took a big step
to establish stable property rights, and
I am sure this system will work – of
course if Nazarbayev supports it.”