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Ukraine – A conflict society

Published 14:27 January 7, 2022
A general view of Ukraine's Verkhovna Rada, the country's unicameral parliament.

Ukraine is a society at war. Its enemies are within its borders and Putin’s Russia. The primary objectives represented by both these entities is to ensure that Ukraine remains weak as a functioning state and its national sovereignty and independence provocatively and constantly challenged.

Ukraine is a society that finds itself being forced into a perpetual state of conflict, aggressive behavior by Russia, to be sure, but also as a result of internal political ineptitude and will as it searches for its democratic identity and place in the Western family.

Years after the political upheaval of the Maidan, its leadership is still unable to clarify the road forward after a historic societal decision to leave the Russian sphere of influence.

The Maidan event was a historic repudiation of a corrupt order led by the pro-Russian, Viktor Yanukovych, by greater Ukrainian society, an order largely influenced by a Russian inspired oligarchic, anti-democratic, anti-rule of law, and a xenophobic economic system.

Contrary to accepted thinking, the Maidan was not a revolution, but a rebellion against corruption and the system of governance. It was not a revolution because the old system was not destroyed or overturned.

Old practices have mostly remained in place, immune from half-hearted attempts at reform. This is largely a result of leadership that has not repented for the old ways of thinking and doing things in government and within the courts. But it is also the result of a political leadership that is not fully cognizant of the values needed to transform its governing structures.

The present political, governing, legal and economic leadership of Ukraine is not prepared nor dependable to legislatively enact and build a rules-based just society. Despite many opportunities and time, Ukraine is a country where half measures seem to be constantly pursued.

The recent withdrawal of TIU Canada, one of Ukraine’s leading foreign investors, from its legal proceedings against the oligarch Igor Kolomoisky, due to having been illegally cut off from the electricity grid by using fraudulent and illegal conditions, or being essentially “raided”, shows the failure of the Ukrainian government in conducting reforms.

This has become an example of failure, not only in failing to protect the interests of its foreign investment partners, but in the government’s inability to fix a legal system that would be informed by accepted western business norms that are inspired by the principle of the rule of law.

After two years of legal proceedings, numerous recusals by judges and delays, an appellate court in Kyiv decided to return the case back to a lower court, forcing the company to return to ground zero. Millions of dollars have been lost, regulatory bodies had been ignored, no police investigations conducted and no promised criminal prosecutions pursued of what many independent observers believed to be a result of criminal intent. Promises of legal and court reforms remain unfulfilled, and any efforts were undertaken, surely have not taken hold.

Unless you are a multinational conglomerate company, or one too big and prominent to be messed around with and intimidated, attempting to do business in Ukraine following established and assumed free-market traditions, is an extremely high-risk undertaking.

Despite continuous pronouncements from the Presidential administration and self-interested international boosters about the positive potential for investment in Ukraine, investment in Ukraine, especially by mid cap companies, is about to come to an end.

What the TIU Canada case has made undoubtedly clear is that Ukraine is a market where investors are not protected from predatory “raiding” by local “businessmen”. It is a place where the rights of investors are not fully considered by the courts, where there is no proof of a rightful assumption for fairness within the legal system, and where there can be no expectation that local prosecutors and police will fulfill their fundamental responsibilities or investigate potential crimes.

What the TIU case against Kolomoisky illustrates is that despite promises of reform and change, the systematic and institutional transformation of Ukraine is a failure. Ukraine is a jurisdiction where the rule of law in fundamental business practice, does not rule.

Despite two changes in government since the Maidan, Ukraine continues to be led by duplicitous individuals who make promises on behalf of the state that they do not keep and who do not respect the ramifications of reneging on agreed to financial arrangements.

Ukrainians have proven that they cannot be trusted to do what they have promised. The present political leadership does not know how to act in a rules-based free market system and clearly is not aware of the connection between economic growth and respect for the rule of law. In Ukraine, governments may change, but the values of those responsible for governing, don’t.

That is not to say that Ukraine does not have quality leadership. It does. However, those individuals are not in the current leadership and have not been pushed forward by either the Zelensky administration or Ukraine’s Western partners. The reality is that those of a Western orientation have been systematically run out of Zelensky’s government or were not invited to join in the first place. Yes, this is a war about values and it is one front where a sovereign Ukraine is losing.

That said, Putin’s battle for the hearts and minds of Ukrainians has been lost.

The vast majority of the Ukrainian populace has rejected any further participation in the Russian world. Poll after poll reveals a continuous desire of Ukrainians to become part of democratic Europe and western institutions.

Ukrainians, a very rebellious people by nature, and as a result of decades-long oppression, especially from Russia, will not tolerate any attempted future absorption of their country into the Russian world.

However, the prominent political leadership of Ukraine has missed, or even rejected, that the most effective strategy against Putin’s continued aggression, is for Ukraine to transform itself into a rules-based, democratic and free-market society.

Putin’s actions towards Ukraine illustrate that he sees a democratic and free-market Ukraine as a “threat” to Russia. Putin’s misguided world view cannot, and does not, accept that a sovereign and independent country has the right to determine how it is going to be governed by its people. Putin will eventually have to accept this fact. A free and independent Ukraine is a historic fact.

Ukraine has proven that it has absolutely no desire or inclination to be a military or security threat to Russia. If anything, Ukraine wants to pursue a peaceful course, to be left alone, and to allow its people to pursue their family and economic ambitions as part of Europe.

Russia illegally, and in transgression of international norms, pursues a war of aggression against Ukraine.

That said, the people of Ukraine have had enough of Putin, his threats and his interference in its affairs. Almost 57% of Ukrainians, as stated in a recent national poll have said, that if their country is attacked, they are willing to take up arms against any future Russian invasion.

It must be repeated, the wars within Ukraine are about values, freedom on the one hand, and the submission to imperialistic authoritarianism, on the other.

Two post-Maidan governments have been electorally mandated to make fundamental changes in Ukraine. However, they have failed to create a new societal order that demands a modicum of justice and fairness, a system that would, in the least, purport to pursue the principles of economic justice that provides equal opportunity for all, a system where free markets determine the competitive pricing of goods and services for the benefit of ordinary consumers, and an unbiased regulatory system that would work efficiently to prevent monopolies that benefit only the few, and perhaps most importantly, the creation of a court system that would represent the predominance of the rule of law as the ultimate expression of democratic order.

Ukrainian oligarch Igor Kolomoisky. He was sanctioned by the United States in March 2021.

The principles and values of Ukraine’s political leaders continue to fail to deliver fundamental change because they have been both unwilling and unable to institutionalize the democratic values that have been demanded by Ukraine’s electorate inspired by the “Revolution of Dignity” of 2014.

Another war front, this one internal, is a Russian inspired oligarchic system that does not accept a democratic value system for Ukraine and where corrupt individuals operate with detailed efficiency to ensure that the path to a rules-based society is destroyed. These individuals who make up this anti-democratic, anti-rule of law group are not only oligarchs, but corrupt politicians and bureaucrats at all levels who believe that they are entitled to manipulate and profit from criminal schemes by “working” the system. Successive governments in Ukraine have not rooted out this problem.

The abject lesson of the TIU Canada case against the oligarch Kolomoisky is the saga of the failure of Ukraine’s governing class to work to complete the transformation of Ukrainian society and establish a strong foundation for a rules-based society. This failure has left Ukraine vulnerable and weakened in its national sovereignty and in its ability to assert its independence from a position of strength.

All that said, the war within Ukraine and with Russia is about the fulfillment of a historic national quest for a free and democratic Ukraine based on the rule of law.

Source: New Europe


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