Foreign Affairs, November/December 2011

Ukraine, no stranger to crisis, is again in turmoil. President Viktor Yanukovych has failed to deliver on any of his campaign promises -- economic reform, increased prosperity, and an end to corruption -- and instead has rolled back democracy and the rule of law, deepening political, regional, and linguistic divisions in the country. He has succeeded only in turning Ukraine against him and his government. Symptomatic of his government's incompetence and misrule is the trial for "abuse of power" of former Prime Minister Yulia Tymoshenko, the fiery democratic politician who almost beat him in the 2010 presidential election and remains his principal political competition. The charges against her are absurd, and the trial has only galvanized the opposition and discredited Ukraine just as it has sought to move toward the West by signing a free-trade agreement with the European Union.

The Yanukovych government has squandered the opportunity to rebuild a country that had lost its way in the last few years of the government of former President Viktor Yushchenko, who was elected following the 2004 Orange Revolution and led a coalition government with Tymoshenko. It has also backed itself into several dead ends with no easy way out. Although the growing talk in Ukraine about the government's downfall is most likely premature, Yanukovych and his ruling Party of Regions have certainly lost the support and confidence of most Ukrainians, who hold the government responsible for their poverty and alienation. Yanukovych's inability to govern effectively also risks alienating both the West and Russia, compounding his growing isolation at home with isolation abroad.

Unless Yanukovych reverses course and engages the democratic opposition while making dramatic political and economic reforms that would be painful to both his party and the people, Ukraine's crisis will only deepen and the country will become increasingly authoritarian, impoverished, polarized, and unstable. Such a scenario is of concern to the West, as Ukraine is a country of 46 million people situated in the strategically important space between the EU and Russia. Ukraine's instability could undermine the normalization of relations between the West and Russia, threaten Europe's ongoing efforts at economic stabilization, and encourage Moscow to consider some form of intervention, which would, almost inevitably, destabilize Russia itself -- all of which has policymakers in Brussels and Washington increasingly nervous.

EAST SIDE BOYS

Since Yanukovych's election in early 2010, his administration has distanced itself from the principles of the preceding Orange government, that of Yushchenko. First, Yanukovych replaced Yushchenko's moderately pro-Western foreign policy with a decidedly pro-Russian orientation. This was most clearly manifested in the April 2010 Kharkiv accords, which extended the Russian Black Sea Fleet's basing rights in the Crimea for 25 years in exchange for supposed reductions in the price of Russian gas and a $2 billion credit line. Even Ukrainian government officials admit in private that it was a bad deal: Ukraine still pays exceptionally high gas prices and failed to negotiate an adequate rent for the base, whereas Russia has succeeded in ensconcing itself for the long term in the intensely pro-Russian Crimean Peninsula. Next, Yanukovych jettisoned Yushchenko's democratic aspirations and made an unabashed turn to authoritarianism: he transformed Ukraine's parliament into a rubber-stamp institution controlled by the Party of Regions, subordinated the courts to his rule, and concentrated enormous power in his own hands. This turn to authoritarianism was codified in October 2010, when the parliament approved a constitution that enshrined presidential dominance. Finally, Yanukovych reversed Yushchenko's pro-Ukrainian cultural initiatives by appointing the notoriously anti-Ukrainian official Dmytro Tabachnyk as minister of education and science and permitting him to roll back a variety of state-funded programs aimed at fostering Ukrainian language and culture.

Taken together, these elements of the Yanukovych system immediately provoked outrage within significant segments of the Ukrainian public, especially the pro-democratic, Ukrainian-speaking electorate based largely in central and western Ukraine. This same constituency also criticized Yanukovych for failing to unify the country and correct Yushchenko's many mistakes, from not passing economic reform to neglecting to tackle entrenched corruption and administrative incompetence. Indeed, Yanukovich's most striking achievement has been to unite much of the country against him.

Yanukovych's policies are not surprising given his origins and political base. He comes from a Sovietized, working-class background in Ukraine's industrial heartland, the Donbas, where fisticuffs and obedience to authority were valued more than rational discourse and democratic deliberation. His supporters are overwhelmingly based in the pro-Russian and Russian-speaking east and south. The Party of Regions is a collection of ex-Soviet functionaries who have amassed wealth through corruption and have scant understanding of democracy and even less appreciation of Ukrainian identity.

These drawbacks have been compounded by two additional flaws of Yanukovych's administration. First, Yanukovych and his ministers -- most of whom also hail from the Donbas -- were previously provincial leaders and so have little experience running a state. Their insularity, inexperience, and Soviet-style hauteur have produced an unprofessional and incompetent style of rule that has ultimately threatened their own power. One example is the messy implementation of a new and flawed tax code. In 2010, reformers in the Yanukovych administration spent months working on a new code that no one else, including the Yanukovych-dominated parliament, liked. By that summer, protests organized by owners of small and medium-sized businesses were mounting throughout the country, with the entrepreneurs claiming that the code would put them out of business. In November 2010, up to 20,000 of these businesspeople staged a two-week rally in Kiev's Independence Square, the site of the Orange Revolution. Eventually, a delegation of protesters was invited to meet with the administration. When the group asked one of Yanukovych's advisers what the president thought about the code, they were told that he had not read it. Soon thereafter, the protesters were evicted from the square, and Yanukovych introduced some perfunctory changes to the code -- which is still unpopular and, as predicted, has led to the closure of many small and medium-sized businesses.

Another example of the administration's incompetence was the ham-handed decision to try Tymoshenko for abuse of power. The trial is widely seen in Ukraine as politically motivated and designed to prevent her from running for president in the 2015 election. The irony of this blunder is that it was unnecessary; the best way to deal with Tymoshenko would have been to leave her alone. Her popularity had tumbled since the 2010 election, and few Ukrainian democrats consider her a viable leader of the country's liberal camp. By placing Tymoshenko on trial, the Yanukovych administration has achieved precisely the opposite of what it wanted. Not only has the move increased Tymoshenko's stature, but it has given the formerly divided Ukrainian opposition a common cause to rally around (several opposition parties formed the Committee of Resistance to Dictatorship) and earned the Yanukovych government fresh criticism from abroad, even from Russia, its ostensible patron. In August, Russia's Ministry of Foreign Affairs called for the trial to be "fair and impartial" and to observe "elementary humanitarian norms and rules." (It should be noted that Moscow's concerns were motivated not by a sudden appreciation for human rights but by the fear that the trial could serve as a pretext for Kiev to revoke Tymoshenko's 2009 gas agreement with Moscow, which has proved advantageous to the Kremlin because it links the already high base-line price Ukraine pays for Russian gas to world oil prices, which shot up after the deal was signed.)

The Yanukovych administration's second major flaw is that its reliance on the Party of Regions negates the possibility of badly needed economic reforms. Although Yanukovych promised in the run-up to the election to modernize the country's economy and propel it into the ranks of the world's 20 richest nations, he, like the Orange government of Yushchenko and Tymoshenko, has accomplished virtually nothing; meanwhile, poverty and inflation in Ukraine have increased. But whereas the Orange leaders failed largely due to their personal animosities and the constant obstructionism of the Party of Regions, Yanukovych's inability to refashion the economy is rooted in the fact that his ministers and advisers have no understanding of a market economy, having spent most of their professional lives in the Donbas, where entrenched communist rule was replaced with entrenched oligarchic rule.

More important, genuine market-oriented change directly contravenes the interests of the Party of Regions, which thrives on its ability to control investment and finance, expropriate surpluses, and distribute economic resources as patronage. Unsurprisingly, its leading cadres resist whatever changes are pushed by the small band of isolated and generally ineffectual reform-minded economists and entrepreneurs in Yanukovych's inner circle. Most Ukrainians are fed up with the Party of Regions' ostentatious wealth and growing abuse of office, especially in the provinces, where local kingpins behave like pashas. Yanukovych has further added to the popular anger by living in a huge estate outside Kiev and owning a house worth an estimated $10 million.

By now, no one in Ukraine believes Yanukovych's promises to turn around the country's economy and spread prosperity. The situation in the country's easternmost province, Luhansk, is especially alarming for Yanukovych. Like Donetsk, its neighboring province to the south, Luhansk represents Yanukovych's base -- but support for the Party of Regions there has crashed. According to an April 2011 study conducted by Voldymyr Dahl East Ukrainian National University, although more than 53 percent of Luhansk's inhabitants would have voted for Yanukovych's party in November 2009 -- and Yanukovych received 89 percent of the Luhansk vote in the 2010 presidential election -- only 30 percent would do so today. (A study conducted by the Luhansk-based polling organization the Sociolab Group puts this number at 26 percent.) The reason for the decline is clear: other surveys show that the province's inhabitants are most worried about decreasing living standards, inflation, and unchecked corruption. Unsurprisingly, Yanukovych's approval rating in national opinion polls conducted by the Kiev-based think tank the Razumkov Center has plunged: 41 percent responded that they "fully supported" him in April 2010 and only 11 percent did so in May 2011. Support for the Party of Regions fell from 39 percent to 16.5 percent over the same period. According to another poll by the Razumkov Center, those Ukrainians who believed the country was going in the wrong direction rose from 34 percent in April 2010 to 63 percent in May 2011.

Unsurprisingly, social unrest has increased; 43 percent of those responding to another Razumkov Center poll in April 2011 said that they were ready to join "legal protest actions" against inflation, 34 percent would do so to protest the nonpayment of wages, 22 percent would protest against the excesses of local authorities, and 15 percent would do so in support of human rights. Intellectuals, students, and Ukrainian-speaking democrats are already taking part in recurrent protests against the anti-Ukrainian policies of Tabachnyk and the growing authoritarianism and pro-Russian tilt of the rest of the Yanukovych administration. A self-styled "new left" has emerged, reminiscent of the student movements that rocked the United States and Western Europe in the 1960s, demanding the abolition of social inequality, capitalism, and oligarchic rule. At the same time, a formerly insignificant Ukrainian right-wing nationalist movement has been galvanized by Tabachnyk's anti-Ukrainian policies and now talks of revolution and Russian imperialism. The activists of FEMEN, a women's group, draw attention to political corruption, social injustice, and gender inequality through theatrical demonstrations at which they frequently appear topless. Entrepreneurs and, increasingly, Russian-speaking workers in the eastern and southern provinces, rail against economic stagnation. In particular, the Tymoshenko trial and the 2oth anniversary of Ukraine's independence on August 24 have served as focal points for public discontent and provided occasions for widespread street protests. In short, Ukraine is facing abundant unrest that could be mobilized in sudden and unexpected ways, particularly by the young population and through social media, both of which demonstrated their ability to take on a seemingly powerful regime during the Orange Revolution.

The Yanukovych administration has become trapped by its own policies. The triad of cultural anti-Ukrainianism, political authoritarianism, and a pro-Russian foreign policy has failed to offer an alluring alternative to the Yushchenko years. Worse, it has failed to invigorate the economy, unify the population, or offer hope, especially to the youth, that a better future awaits. Faced with a growing illegitimacy that reached crisis proportions in the middle of 2011, Yanukovych opted for what seemed like the easiest and least painful way of addressing his woes: tacking toward the West. But the shift has proved to be more difficult than he may have anticipated. To make it convincing, Yanukovych would have to pursue pro-Ukrainian cultural programs and pro-democratic political policies, which the Party of Regions loathes and which would almost certainly provoke opposition from Yanukovych's erstwhile ally, Russia.

STUCK IN THE MIDDLE WITH YOU

The clearest manifestation of Yanukovych's interest in moving Ukraine closer to the West is a deal now under negotiation between Kiev and Brussels called the Deep and Comprehensive Free Trade Agreement. Ostensibly aimed at phasing out tariffs in EU-Ukrainian trade, the accord, part of a larger proposed association agreement, actually goes much further: it requires the alignment of regulations on issues ranging from the environment and energy policy to intellectual property rights, as well as measures to advance democracy and good governance. It also envisages visa-free travel to EU countries for Ukrainians. Yanukovych's government seems, on balance, to be serious about the accord and to understand that to enjoy the benefits of free trade with the EU, Ukraine will have to implement the agreement's principles on democratic governance and market-oriented economic reform. It is telling that Yanukovych, despite pleas (and, some Ukrainian officials say, pressure) from Moscow, has chosen to join a free-trade zone with the EU rather than take part in the Russian-dominated Customs Union (CU), which also includes Belarus and Kazakhstan.

Ukrainian officials and their EU counterparts seem confident that the accord will be signed as scheduled by the end of 2011, despite Europe's economic crisis and growing wariness toward immigration. Yanukovych is desperate to score a victory and wants to use the free-trade agreement to compensate for his domestic failures and declining popularity and the growing instability at home. Making concrete progress toward joining the EU is among the few issues on which almost all Ukrainians agree. The EU, even with its current economic problems, promises prosperity, stability, and security -- all things Ukraine lacks.

During their time in power, Yushchenko and Tymoshenko did their best to integrate Ukraine with western Europe, but due to the EU's reluctance to integrate with a large and poor country and to risk alienating Russia, it resisted, and Yushchenko and Tymoshenko's efforts ended in mutual resentment and recrimination. If Yanukovych, whose career has been built on pro-Russian sympathies, could accomplish what the Orange leadership failed to do, he would increase his stature at home and could claim that his administration is progressive after all.

The agreement would also boost Yanukovych's personal status, something he particularly prizes. A poor boy who made good, Yanukovych relishes rubbing shoulders with EU leaders. Likewise, although the free-trade zone would by no means guarantee membership in the EU, the prospect of being the president who laid the groundwork for such membership appeals to the vanity of a man who made his first official trip abroad as president to Brussels, not Moscow. By contrast, given Russia's dominant role in the CU, joining that group would transform Yanukovych into a satrap of Russian Prime Minister Vladimir Putin, whom Yanukovych regards as the avatar of Russian arrogance. Yanukovych has good reason to be concerned. Once in office, he abandoned Yushchenko's animus toward Russia, giving Russia's Black Sea Fleet a long-term lease in the Crimea and announcing that Ukraine would not join NATO and would instead adopt a "non-bloc policy." Yet Russia has not rewarded his loyalty. Moscow continues to insist -- just as it did in the Yushchenko years -- on high gas prices, suggesting that it might lower them in exchange for control of Ukraine's gas pipeline network and the general right to treat Ukraine as a vassal state.

Although Yanukovych does not view his turn toward western Europe as anti-Russian (quite the contrary, in fact: he says he is committed to maintaining a "strategic partnership" with Moscow), the Kremlin is suspicious of the proposed EU-Ukrainian accord and wants Kiev to join the CU instead. Some Ukrainian officials, including Yanukovych himself, have floated the idea of a "3 + 1" scheme, an unclearly thought-out notion that would somehow enable Ukraine to sign the agreement with the EU and also enjoy special status within the CU. Yet the Russians want Kiev to choose: either the EU or the CU. Nonetheless, Yanukovych has made it clear that he will not accept Moscow's ultimatum, and he appears determined to finalize the EU deal.

Russia would see such a choice as even more threatening than, for example, Georgia's flirtations with the West. Ukraine is the size of France and has an ethnic Russian population of 7-8 million, living mainly in the east and the south. It also has a centuries-old historical and cultural connection with Russia. Patriarch Kirill, head of the Russian Orthodox Church and titular head of the branch of the Ukrainian Orthodox Church that is subordinate to the Moscow Patriarchate, is the most frequent high-level visitor to Ukraine and dreams of a pan-Slavic community with Russia as its leader and Orthodox Christianity as its faith. It is hardly surprising that Moscow sees the free-trade deal not as a mundane commercial treaty but as an existential choice about where Ukraine's future lies.

Yanukovych's decision not to seek NATO membership has not soothed such qualms. Despite Yanukovych's talk of keeping Ukraine a "non-bloc" country, Kiev continues to take part in NATO exercises, allows NATO ships into the Black Sea, and participates in NATO peacekeeping operations and training missions in Afghanistan, Iraq, and Kosovo. As part of the association agreement, Ukraine plans to implement the EU's "third energy package," which, among other things, seeks to separate the ownership of energy supplies from the ownership of energy transportation systems. Russia would then be hard-pressed to acquire control of Ukraine's gas pipeline system, something that it has long sought, because that would require EU approval. Ukraine already conducts a third of its total trade with the EU, the same proportion as it does with Russia; Moscow fears its share will only decline should Ukraine move forward with its multifaceted integration with the EU.

Since 1992, Russia has declared, and indeed demonstrated, that it regards the territory of the former Soviet Union as pivotal for its prosperity and security. Accordingly, Moscow has sought to maintain its paramount position in the region by parrying threats to its interests. All this makes it unlikely that Russia will stand passively by as Ukraine proceeds with its free-trade pact with the EU. For starters, Russia has suggested that Ukraine's signing of the accord could affect the price Ukraine pays for Russian gas in the future and that Ukraine may be called on to settle its energy debt with Russia, quickly and in full. Russia might lobby individual EU states, such as France, Germany, and Italy (which have been more sensitive to Russian foreign policy concerns than other EU members), to delay, or even derail, the pact. Although Ukraine's sheer size makes a so-called Georgian scenario -- in other words, the use of military force by Russia -- nearly impossible to imagine, a full-blown crisis between Ukraine and Russia is not.

THE SOCCER WAR

Yanukovych will be able to deal with Russian pressure only by returning to the measured foreign policy pursued by every preceding Ukrainian president, including the pro-Western Yushchenko, since independence in 1991: balancing Russia with the West while pursuing good relations with both and aiming at long-term integration into the global economy and with western Europe. But in order to reestablish productive relations with the United States and the EU, he will have to abandon the other two pillars of his system: authoritarian rule and an anti-Ukrainian cultural policy. The simplest way to accomplish that, and to win support among the electorate, would be to fire Tabachnyk, institute an evenhanded approach to both Ukrainian and Russian culture, forge a grand coalition with the democratic opposition, and pursue serious economic reforms. Yet such a course would in effect mean abandoning the Yanukovych system and relegating the Party of Regions to the status of a coalition partner. It would also mean that the state would no longer interfere with the country's media and hound its political opponents.

Although Yanukovych will resist making such concessions, the growing crisis in the country and the political dead end into which he has maneuvered himself may force him to do so -- less for the sake of the country than for his own political survival. But he will have to move slowly given the resistance of the Party of the Regions. It will also be difficult, if not impossible, for Yanukovych to persuade western Europe of his democratic bona fides in light of the Tymoshenko trial. And it is unclear whether Yanukovych understands that Ukraine's free-trade pact with the EU is not a sure thing. For it to succeed, the Ukrainian government will have to meet an array of benchmarks, some of which would threaten the cronyism, corruption, and patronage that are essential to the present political order. Most important, a guilty verdict for Tymoshenko would make it difficult for Brussels to certify that Ukraine has demonstrated a commitment to democratic politics.

Even if Yanukovych arranges for Tymoshenko to receive a suspended sentence accompanied by an injunction that would prevent her from participating in political activity for a few years or pardons her after the court hands down a jail sentence, the negative publicity generated by the case will have taken its toll. Many in the West now doubt whether Yanukovych's government can be trusted to respect democratic principles. Already, these fears have led Ukrainian oppositionist democrats, European intellectuals, and prominent Western analysts to call on the EU to put the integration process on hold.

The EU and the United States should resist that temptation and instead persist with Ukraine's integration with the West. The free-trade agreement with the EU is not, as critics insist, a reward for Yanukovych and his cronies; it is a means to promote significant change within Ukraine and thereby empower the Ukrainian people to resist authoritarianism and to assert their democratic and economic rights. In turn, as it pursues its "reset" with Russia, the United States would do well to remember that Russia is less likely to be stable and democratic if Ukraine becomes unstable and even more undemocratic.

As Yanukovych tries to have it both ways abroad -- appealing to the EU while violating European values and maintaining good relations with Russia while rejecting the CU -- time is running out for his administration at home. Continued authoritarianism, corruption, incompetence, unprofessionalism, and lack of reform outrage all Ukrainians, even those in his traditionally more docile base in the east and the south. The likely result will be official paralysis and growing social instability, and perhaps even a major explosion of public anger sometime next year.

Two events, both scheduled for mid- to late 2012, could serve as catalysts. The first is the 2012 UEFA tournament, which will be held next summer in Poland and Ukraine. Up to a million foreign soccer fans are expected to visit the Ukrainian cities of Donetsk, Kharkiv, Kiev, and Lviv. Ukraine's opposition will likely use the presence of so many foreigners to make their case to the West by mounting protests. It will not be easy for the Yanukovych government to resist its knee-jerk repressive impulses, yet with so much international attention on the country, it will have to do its best. Even if Kiev manages this feat, the real spark could occur a few months later: when parliamentary elections are held in October 2012. If the Party of Regions tries to manipulate the vote -- and, with its popularity falling, this may be the only way it thinks it can hold on to power -- Ukrainians could very well take to the streets. Should Ukrainians in the east and west of the country join forces, the resulting social upheaval could make the tumult of the Orange Revolution seem trivial.

(AUTHOR BIOS: Rajan Menon is Monroe J. Rathbone Professor of International Relations at Lehigh University. Alexander J. Motyl is Professor of Political Science at Rutgers University in Newark.)

 

 

 

Copyright 2011, Foreign Affairs