· Ukraine’s J. Edgar Hoover? Last Thursday, President Poroshenko picked little known lawyer Artem Sytnyk as the Director of the Anti-Corruption Bureau of Ukraine. Sytnyk, age 35, hails from Kirovohrad region and began his career in that region’s Prosecutor’s Office. In 2008 he was promoted to the post of Investigation Chief for Kyiv oblast’s Prosecutor’s Office. A year after Yanukovych was elected President, Sytnyk quit his post because of his “disagreement with the policy of Yanukovych’s regime, the criminalization of law enforcement bodies, the dismantling of the fight against corruption, and the absolute lack of professionalism and regime-engagement of the then Kyiv Oblast Prosecutor”. According to Sytynyk’s financial disclosure, he and his wife earned about $14,000 US dollars last year from all sources which would make place him socially within Kyiv’s middle class. Sytynyk will now begin the task of interviewing and hiring the 700 member staff of the Bureau. To help eliminate corruption within the Bureau, the minimum staff salary will be $800 per month, which is more than twice the average salary in Kyiv.
The selection of Sytynyk by Poroshenko was surprising since many expected him to choose Kyiv MP Viktor Chumak from the Poroshenko Bloc. Chumak, a two term deputy originally with Vitaliy Klitchko’s UDAR, is the Chairman of the Parliamentary Committee on Fighting Crime and Corruption. However the Anti-Corruption Board of Director gave seven votes each to Sytnyk and five to Mykola Siry, but just three votes to Viktor Chumak. As a result, only the names of Sytynyk and Siry were forwarded to the President for consideration –and not Chumak. Under Ukrainian law, the President can choose from up to three nominees proposed by the Board of the Anti-Corruption Bureau. Since the other candidate, Mykola Siry, made his mark as Yulia Tymoshenko’s defense lawyer in the politically charged case against her in 2011, it was unlikely from the beginning that Poroshenko would select the top lawyer of his rival for the presidency last year to Head the Anti-Corruption Bureau. By not having the opportunity to appoint Chumak and selecting Sytynk instead, Poroshenko avoided charges that he was playing favorites with members of his parliamentary faction (e.g. Chumak) while simultaneously keeping an ally as the Chairman of a prominent Parliamentary Committee (e.g. Fighting Crime and Corruption). In this way, if the President disagrees with the direction that Sytnyk takes the Anti-Corruption Bureau, he can nudge his ally on the Parliamentary Committee for Fighting Crime and Corruption to publicly refocus the debate. This tool combined with the fact that the President appointed three of the nine members of the Anti-Corruption Board of Directors (with Parliament and the Cabinet of Ministers appointing three members each as well), ensures Poroshenko will maintain some checks and balances over Sytynyk’s influence as Director. In addition, Sytnyk may be a political unknown but he is not without connections to powerful politicians. For example, after quitting the Kyiv Prosecutor’s Office in 2011, Sytnyk worked for the “Jurydychni Garantiy” law firm founded by former Kyiv Prosecutor Yuri Haisynsky. Haisynsky’s daughter Oksana is married to controversial Kharkiv Mayor Gennadiy Kernes, who may soon be arrested for alleged crimes committing during Euromaidan. Thus, one of Sytynyk’s first tests as Anti-Corruption Bureau Director will be to avoid meddling in the pending case against his old boss’s son-in-law.
J. Edgar Hoover became Director of the newly created Federal Bureau of Investigation (FBI) at age 40 and served under six US Presidents. Hoover made his mark in fighting the mafia and Communists and as a result, the FBI became a powerful force in law enforcement. Artem Sytnyk will serve at least two Presidents as under Ukrainian law he has a non-renewable, seven year term in office. In this case, following Hoover’s example of fighting the mafia and Communists is exactly what the country needs.
· Suicides and Assassinations: Last week brought news of the apparent assassinations of former Regions Party MP Oleg Kalashnikov and Russophile journalist Oles Buzyna. Both men were killed near their apartments in Kyiv by unknown assailants. Almost immediately, a previous unknown group called the “Ukrainian Insurgent Army” claimed credit for the assassinations as well as the recent suicides of Chechetov, Peklushenko and Melnyk. At the current pace, two pro-Russian politicians are dying per month since the start of the year. In Table 1 below there is a list of recent mysterious deaths of pro-Russian politicians.
As with the other recent deaths, there won’t be many tears over their departures as both Kalashnikov and Buzyna were somewhat notorious. Kalashnikov’s most memorable moment as a Member of Parliament was when he led a group of thugs to physically assault female STB Channel journalist Margarita Sytnik in July 2006. More recently Kalashnikov was believed to have been working as a financial conduit to the “titushkis” (paid thugs) who terrorized Euromaidan activists during the protests last year. Buzyna ran for Parliament in Kyiv’s Shevchenko District #223 in 2012 and finished fourth (out of 24 candidates) with 8.2% of the vote in a contest that was later invalidated due to fraud. In a repeat election held in December 2013 for the same district, Buzyna again finished fourth (out of a record 71 candidates) but with just 3.1%. Buzyna is best remembered for his work as Editor-in-Chief of Rinat Akhmetov’s “Sehodnya” (Today) newspaper where he decreed daily diatribes against the all things Western.
An investigation is pending but it would appear that the endgame from the Russian side is to create a “moral equivalency” between these assassinations and the murder of Russian opposition figure Borys Nemtsov last month. Shortly after the death of Buzyna, Putin stated that this is evidence which “shows Ukraine is not becoming European”. As MP Yuri Lutsenko (Poroshenko Bloc) said, “these killings hurt the image of Ukraine and cause division between Ukrainians and their friends in the West”. MP and Interior Ministry Spokesman Anton Herashchenko added, “Looks like the extermination of the witnesses in the Anti-Maidan case is continuing”.
Either way, there is an effort on the Russian side to drive a wedge between Ukraine and its European allies (primarily aimed at France and Germany). That is why recent talk of banning the Communist Party in Ukraine is unhelpful (see “Communist Ban?” in Ukraine Update 4/13). Last week the effort gained some grassroots momentum when the Ivano Frankivsk Oblast Council voted with 60 out of 113 present “to ban on the territory of Ivano Frankivsk region the activities of the Communist Party of Ukraine, the Party of Regions, the Opposition Bloc, and the Ukraine Development Party, which contradict the interests and violates the rights and freedoms of the citizens of Ukraine”. The resolution also called on the Justice Ministry in the region to revoke the registration of these parties in Ivano Frankivsk. While the sentiment of the Ivano Frankivsk Oblast Council is understandable, the reality is that none of those parties are a factor in local politics. At the height of Yanukovych’s power in 2012, the Party of Regions and Communists received just 5.2% and 1.8% respectively in the Parliamentary Elections in Ivano Frankivsk oblast. Banning a political force which is not a player, automatically makes it a player in the public’s mind. More importantly though, it plays into Russian propaganda that the Ukrainian government is intolerant and run by fascists. Ukrainians have to act smarter than the well intentioned, but naïve Ivano Frankivsk Oblast Council.
· Ukrainian Local Elections Debate: Among the various proposals for this autumn’s elections is the institution of a runoff law for mayoral races in cities of 100,000 people or more. Justice Minister Pavel Petrenko proposed this idea along with his call for an open list election system. If approved by Parliament and signed by the President, it would affect mayoral races in 41 cities including all 25 oblast capitals as well as 16 others (see Table 2 below).
The runoff law for city executives (assuming it mirrors the Presidential Election procedure under the Constitution which will soon be amended) would require that if no candidate receives a minimum of 50% plus one vote in the first round of local elections (conducted simultaneously with elections to local councils), that the two top vote getters advance to a second round election two weeks later. Essentially, this law would end up applying to almost 90% of mayoral elections in these 41 cities. For example, last May Kyiv elected Vitaliy Klitchko with just over 51%, so in this case no runoff would be needed. However Kyiv was the exception and not the rule. Ukrainian elections for mayors typically result in crowded fields of technical candidates allowing the winner to triumph with around 30%.
Historically, runoffs became popular in the Southern United States during the period of Reconstruction (after the Civil War), when many former Confederates feared the new voting power of black Americans who mostly voted en masse for the Republicans (the party of Abraham Lincoln would freed them from slavery). If the field of white Democrats was crowded, a candidate backed by the black minority could achieve a plurality victory. This led to the institution of runoff laws so that in the second round, Democrats could unite behind a single candidate and rely on the majority of white votes to mathematically carry them to victory over the candidate backed by the minority of black voters. Since each state decides its own election laws under the US Constitution, the laws remain in effect in many states.
On the positive side, this would be a game changer for Ukrainian electoral politics as it would change the electoral equation from subtraction to addition. That is, it would require candidates to build broad electoral coalitions rather than relying on plurality support from the party or candidates’ base of support to win the election. In addition, the institution of a runoff law could prevent hard line Russophiles from winning election in the Donbass. While Russophiles have the support of a highly motivated minority, they could almost never achieve a majority. This would have the effect of helping more moderate, pro-Ukrainian candidates to win in the Donbass. It should be noted, that of the 41 cities over 100,000 in population, 11 are located in the Donbass and another 12 in the so-called “Novorossiya” which spans from Kharkiv to Odesa. In western Ukraine, the law could have the effect of preventing far right parties like Svoboda and Right Sector from being able to win election in the major cities, as their appeal is limited to a plurality of the electorate. However on the negative side, runoffs would increase the cost of administering local elections at a time when the country lacks additional funding. However for now, the runoff election law is more of an idea that has been floated, rather than a bill with momentum.
· Moldovan Polls: Last week, the Moldovan Institute for Public Policy released its “Public Opinion Barometer” poll. The poll points potentially big trouble ahead for the ruling coalition and a surge in support for former Prime Minister Iure Leanca’s new political party (see Table 3 below).
Both the ruling Liberal Democrats and Democrats show a drop of more than 60% of their support since the November 30 Parliamentary Elections and their partner, the Communists show a 30% decline. This is both a factor of public disenfranchisement with the awkward new left-center coalition as well as anger over the economic situation which has resulted in a decline of the currency (lei) by almost 30% and an estimated GDP decline of 1-2% this year. The pro-Russian Socialists, despite winning the Governorship of Gagauzia last month without a runoff, show a 25% decline in support as well. The beneficiaries of the drop in support for the main parliamentary parties are Iure Leanca’s European People’s Party and Renato Useti’s “Our Party”. Both parties show support above 6% which would allow them seats in Parliament if the election were held today. The pro-European opposition Liberal Party showed a slight increase of around 10%.
More troubling than the collapse in poll numbers for the ruling coalition and sustained strength of the pro-Russian parties, are the poll results on European integration. The same poll showed that just 40% of Moldovans would vote to join the EU and 42% would vote against it. This comes after Moldova signed the EU Association Agreement and received visa free travel to Europe last summer. Despite 60% of Moldovans describing relations with Russia as “bad”, 58% would vote to join the Russo-centric Eurasian Union versus just 26% who would vote against. To add insult to injury, 61% of Moldovans mentioned Vladimir Putin as a “trusted” leader while Angela Merkel and Barrack Obama trailed at 44% and 32% respectively. Those numbers are hardly a ringing endorsement of the “European choice” of the nation. While the sour mood of the electorate before the June 14 Local Elections is largely fueled by economic difficulties (more than 90% of Moldovans are unsatisfied with their salaries, employment rate, and size of pensions respectively), corruption appears to be an underlying factor. In a separate poll released days earlier, 53% of Moldovans admit to paying bribes which is up from just 12% in 2008.
While Iure Leanca can be pleased with his rising poll numbers and creation of a five party bloc for the local elections, the task of recruiting good candidates is not going as well. Leanca announced he would not be a candidate for Chisinau Mayor. That is good news for the incumbent Dorin Chirtoaca from the Liberal Party who is likely to face a tough re-election match against Socialist MP Zinaida Grecani (a former Prime Minister). Chirtoaca won in 2011 by just 50.6% to 49.4% over the Socialist Party Leader and MP Igor Dodon (then with the Communist Party). Renato Useti’s solid poll numbers give him additional encouragement to run for mayor of the Baltsi the second largest city. Meanwhile, the governing coalition is likely to suffer losses during the local elections barring a major shift in momentum.
Dates to Watch (for Ukraine unless otherwise noted):
April 21-24: Parliamentary Voting Session Scheduled
April 28: International Conference in Support of Reforms
May 5-8: Parliamentary Voting Session Scheduled
May 13 & 16: Constitutional Commission Meetings: According to Speaker Groisman, the committees will have worked out the materials that will become the basis for future changes in the Constitution by the time of these meetings.
May 19-22: Parliamentary Voting Session Scheduled
May 21-22: EU Eastern Partnership Summit in Riga, Latvia: the EU is supporting Ukraine financially and diplomatically, but they appear in no hurry to grant Ukraine visa free status. It should be noted that Moldova received this status last summer after signing the EU Association Agreement at the Vilnius Summit in November 2013. Ukraine, under Yanukovych at the time, did not sign the agreement and now the country has fallen behind Moldova in terms of visa liberalization.
Late May: IMF Talks with Bondholders Completed: The Ministry of Finance continues negotiations with creditors on debt restructuring. Last week brought good news for bondholders of Ukrzaliznytsia (State Rail Transport Administration), Ukreximbank and Oschadbank as the Ministry foresees merely a prolongation of maturities and no reduction in coupon and principal. Ukreximbank bondholders have until April 27 to approve the offer and would be wise to do so given that other debtors might not receive as favorable terms. The first bondholders meeting on April 13 failed to attain a quorum. Meanwhile a group of investors led by Templeton Funds which hold about $10 billion in debt (including the $3 billion debt to Russia) saw their proposal to merely prolong the maturities on the debt declined by the Ministry. According to Finance Minister Jaresko, the prolongation of maturities is not adequate for Ukraine to meet its requirements with the IMF. As a result, “we will continue to have these negotiations”.
June 2-5: Parliamentary Voting Session Scheduled
June 14: Moldovan Local Elections
June 16-19: Parliamentary Voting Session Scheduled
July 1: Date Decentralization will be approved by Parliament according to Speaker Groisman
July 1-3: Parliamentary Voting Session Scheduled
July 14-17: Parliamentary Voting Session Scheduled
October 25, 2015: National Local Elections for Mayor and City Council
February 2016: Stockholm Arbitration Hearings on Counter Claims between Naftogaz and Gazprom.