Ukraine: An Opportunity for Reinforced European Diplomacy
Ukraine: An Opportunity for Reinforced European Diplomacy

Ukraine: An Opportunity for Reinforced European Diplomacy

Ongoing clashes with Russian-backed separatists in eastern Ukraine combined with rampant corruption mean Ukraine is at a crossroads. In this excerpt from our Watch List 2018, Crisis Group recommends the EU to condition further technical and financial assistance while pursuing diplomatic engagement in Donbas.

This commentary on the oppurtunity for reinforcing European diplomacy in Ukraine is part of our annual early-warning report Watch List 2018.

Four years after the Maidan protests and the outbreak of hostilities in the eastern region of Donbas, Ukraine is at a crossroads. A war on two fronts has stalled on both. In the east, humanitarian conditions are worsening, with minimal progress made toward implementation of the Minsk agreements, which Kyiv’s Western allies and Russia maintain offer the only way out of the crisis. On the other front – Ukraine’s efforts to tackle pervasive corruption and misrule – the government is backsliding, neglecting many issues that brought throngs of Ukrainians into the streets four years ago. The EU, Ukraine’s key political ally, should be stricter in conditioning its vast financial and technical support for the country, while stepping up its diplomatic engagement in the Donbas.

The crisis in eastern Ukraine

The outlook in the east remains bleak. Violence over the past four years has killed some 10,500 and displaced 1.6 million within Ukraine. The UN’s relief efforts – 3.4 million Ukrainians require humanitarian aid – are underfunded even as cold weather sets in. While Russian interference remains the principal driver of the Donbas crisis, it is not the only problem: Ukrainian resistance to the Minsk agreements is growing. In this difficult arena, the EU and its member states should look to take advantage of even small openings.

One such opening might be Moscow’s circulation in September 2017 of a draft UN Security Council resolution on peacekeeping in the Donbas. There are good reasons to be suspicious of Russia’s motives, not least that the narrow mandate and lightly armed force its proposal envisages would more likely freeze the conflict than resolve it. Nonetheless, in a crisis with so few resolution opportunities, this one is worth testing.

For now, the U.S. has taken the lead, with its Special Envoy Kurt Volker pushing Moscow to accept a mission with a more robust mandate, notably including the deployment of peacekeepers along the Ukrainian-Russian border. The EU, however, largely has been missing in action on efforts to settle the conflict. It should assume a greater role and consider appointing an EU envoy or representative for Ukraine conflict issues.

Europe’s participation is important. The leverage afforded by the significant assistance it provides to Ukraine means it is well placed both to advance discussions on peacekeeping and encourage Kyiv to adopt a more constructive approach to Minsk. Brussels should continue to urge Moscow to withdraw fully from the Donbas, but in parallel urge Kyiv to develop a strategy to build consensus within Ukrainian political elites and society more broadly on how to eventually reintegrate separatist-held areas.

Restoring political support for Minsk in Ukraine is critical. Opposition has become a badge of honour for many Ukrainians, who believe the agreements, signed in the wake of two disastrous military defeats, reaffirm Russian and separatist gains in the conflict rather than guaranteeing a just resolution. But shelving Minsk does not appear to be a viable option. Instead, Kyiv should initiate a genuine debate on how, when security in the east improves, it can implement the agreements’ political provisions – such as amnesty for separatists and the devolution of power – without upsetting national cohesion or stability. The EU could use its influence in Kyiv to encourage such discussion, which is currently non-existent.

Kyiv must also work to improve the lives of Donbas residents affected by the conflict. Of particular concern is the practice of tying social payments to IDP status; because a large number of displaced cannot afford the higher rents in government-controlled areas, many of them return to separatist zones, in the process either losing IDP status and social payments or making frequent, arduous journeys across the line of separation. This predicament has fanned anger at Kyiv, as well as resentment between communities. Nor does the state have a housing program specifically geared toward IDPs or, for the most part, allow those with property in separatist areas to benefit from existing affordable housing. Many civil society experts say such policies sabotage prospects for reconciliation.

The EU should continue to push for stronger internally displaced person (IDP) rights protection and support for conflict-affected residents, including delinking social payments from IDP status. It should also scale up funding of affordable housing in conflict-affected areas, which would ideally be made available to both the most vulnerable IDPs and other disadvantaged residents.

Anti-corruption and civic engagement

Kyiv has made significant strides since Maidan, notably in macro-economic stabilisation, ongoing decentralisation reform and the creation of several new anti-corruption bodies. Yet much remains to be done, as domestic reformers and donors – including the EU – acknowledge. Lack of clear progress fighting corruption is exemplified by the late 2017 moves – led by the general prosecutor’s office and deputies from the ruling party – to undermine the National Anti-Corruption Bureau (NABU). It has provoked deep cynicism among many reform-minded Ukrainians, who question not only their leaders’ commitment to change but also the determination of Western governments to hold them accountable.

In this light, the EU was right – from a political, technical and public relations standpoint – to withhold the last tranche of its €1.8 billion Macro-Financial Assistance (MFA) package in December 2017, due to Kyiv’s failure to meet four conditions placed on those funds. The EU should adhere to strict conditionality in 2018, especially regarding anti-corruption reforms. In this regard, a recent EU report, which reviewed Ukraine’s and other countries’ fulfilment of their EU visa liberalisation requirements, called on Kyiv to take urgent steps to sustain anti-corruption reforms and recommended an independent and specialised anti-corruption court, was a welcome step.

The EU should adhere to strict conditionality in 2018, especially regarding anti-corruption reforms.

Decentralisation can be important in the fight against corruption, by opening opportunities for greater citizen political engagement and ushering in more accountable local leaders. The EU has several tools it can deploy in this respect. Along with member states, it should continue to fund the Ukraine-Local Empowerment, Accountability and Development Programme (U-LEAD), which provides material and training support to oblast-level decentralisation efforts. Brussels also should encourage Kyiv to overcome remaining roadblocks to decentralisation, including by clarifying procedures municipalities need to follow to merge administratively with neighbouring constituencies. The still-centralised locales include poor rural towns that would benefit from increased funding and latitude for budgetary planning if authority were decentralised. More broadly, the EU should consider supporting further outreach and training in oblasts that have been slower to decentralise.

Removing unnecessary barriers to reform should also be a priority. These obstacles include Kyiv’s refusal to greenlight local elections in areas near the conflict zone, ostensibly due to security concerns. While in many places concerns are real, local residents and experts claim officials also invoke them to avoid holding polls in areas where pro-Russia parties enjoy support. Locally elected and empowered municipal administrations with greater control over budgetary planning could more effectively identify and target local needs, such as repairing war-related infrastructure damage. By appearing to impede such efforts, Kyiv amplifies anti-Western voices.

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