February 5, 2016

A resignation with ramifications

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KYIV – It came as no surprise that President Petro Poroshenko met with Aivaras Abromavicius within hours of his resignation on February 3 to convince him to remain as minister of economic development and trade.

Mr. Abromavicius is merely the latest Western-backed reformer to go public with complaints about corruption in the government, but he stands out as the most prominent, given his success as an investment banker. And the president knows that if Mr. Abromavicius goes, his standing in the West suffers, analysts said.

“A president with an approval rating in free fall can ill afford offending the Western leaders who provided the diplomatic and financial support to keep Ukraine alive over the past two years,” said Brian Mefford, a non-resident senior fellow at the Eurasia Center of the Atlantic Council who works as a consultant in Ukraine.

The reaction from the West was immediate. U.S. Ambassador to Ukraine Geoffrey Pyatt tweeted that he’s “one of the Ukrainian government’s great champions of reform,” while 11 leading Western diplomats signed a statement expressing their “deep disappointment” over Mr. Abromavicius’s resignation.

“The U.S. and EU are giving money for our reforms but the money is arriving to certain people that they helped to place in power,” said Taras Berezovets, a Kyiv political consultant and director of Berta Communications. “They don’t want to allow a precedent in which a person with close ties with Europe is dismissed. I would call this interference with personnel appointments, which violates the Vienna Convention, based on which diplomats don’t interfere with the domestic politics of a foreign country. But that’s the result of Ukraine being led by those who are giving it money.”

The resignation even triggered selling in Ukraine’s market for Eurobonds, or Ukrainian government debt denominated in U.S. dollars, indicating just how much confidence the business community had in Mr. Abromavicius.

“The creation of a technocratic government was a precondition for the West offering the Ukrainian government its support,” said Petro Oleshchuk, a political science lecturer at Taras Shevchenko National University in Kyiv.

Mr. Abromavicius is not the first Ukrainian politician to gain U.S. backing amid scandal. In late December, Ambassador Pyatt spoke out in defense of Deputy Procurator Generals David Sakvarelidze and Vitaliy Kasko, whose efforts at anti-corruption reform were being subverted by the prosecutor general’s leadership.

Rumors have since persistently circulated that the U.S. government has requested the resignation of Procurator General Viktor Shokin, only to be met with Mr. Poroshenko’s refusals.

Mr. Abromavicius could have resigned earlier given that corruption had been lingering since the first days of the new Cabinet in December 2014, Mr. Oleshchuk said. The timing of his departure could be related to the current talks to reshuffle the Cabinet of Ministers, analysts said.

Mr. Mefford said Mr. Abromavicius was being considered for the post of vice prime minister for euro-integration, a post that has yet to be filled despite repeated demands from Western governments. Yet the motivation would have been to get the anti-corruption reformer in Brussels and away from meddling in Kyiv, he noted.

In the view of Mr. Berezovets, Mr. Abromavicius’s resignation was timed to force early parliamentary elections in which Mikheil Saakashvili, the head of the Odesa Oblast State Administration, wants to field his own anti-corruption party.

“I saw them eating lunch yesterday in a restaurant in the Pechersk district,” Mr. Berezovets told the gazeta.ua news site on February 3. “It’s known that Saakashvili and [Poroshenko Bloc First Deputy Parliamentary Chair Ihor] Kononenko have a long-running personal conflict. Obviously, in speaking with Abromavicius, he stressed what needs to be done and convinced him to accuse Mr. Kononenko of corruption.”

The foreign-born ministers in government – to whom Mr. Berezovets referred as “Vikings” in a reference to the rulers of Kyiv-Rus’ – have the common goal of “dislodging the old elite,” which is also supported by Western governments, Mr. Berezovets said.

Mr. Saakashvili is currently leading a national civic organization, “Movement for Ukraine’s Cleansing,” which is reportedly being supported by the U.S. as an alternative to the current political parties, which are mired in corruption.

The plan is for the movement to evolve into a political party for early parliamentary elections expected this year, Mr. Berezovets said. It will include sincere reformers, including the group of 15 national deputies of the Poroshenko Bloc who launched the Anti-Corruption Platform in late November 2015.