May 2020 saw some positive and negative developments in Ukraine. On one hand, two high-profile international scandals with longtime allies, the United States and Georgia, broke. On the other hand, the issues of financial support from the IMF and the EU were settled. However, these complications and progress in foreign policy were both dependent upon the domestic political processes.
Domestic PolicyMay 2020 saw some positive and negative developments in Ukraine. On one hand, two high-profile international scandals with longtime allies, the United States and Georgia, broke. On the other hand, the issues of financial support from the IMF and the EU were settled.
A Year of Zelensky’s Presidency: Report and New Initiatives
In May, domestic policy in Ukraine had a certain dynamics that kept the Ukrainians and international observers alert. The report of the sixth President of the country V. Zelensky on the first year of his rule, addressed to the Ukrainian society, became the key political event of the month. Zelensky, in his natural semi-formal style, gave a big press conference for Ukrainian and foreign media in the park of Mariinsky Palace. For more than three hours, the Head of the State was answering journalists’ questions. Among many covered topics, the President spoke about the “Minsk process” and the no less complex and tragic Crimean issue. Besides, the President of Ukraine mentioned that the sanctions against the aggressor country, Russia, are tied to both the “Minsk” and the Crimean processes. ‘Without a positive for Ukraine solution to these pressing issues no international sanctions against the Russian Federation can be lifted’, said V. Zelensky. At least Ukraine is constantly working on keeping it this way.
The President also touched upon the language issue, a sensitive one in Ukraine. In particular, the leader of the state replied: ‘‘The language issue in Ukraine… is not on the agenda. This issue is artificial… all the national minorities must know Ukrainian’. However, contrary to President’s statement, there were some other trends concerning the Ukrainian language. For example, the speaker of the Parliament Dmitry Razumkov believes that the current Law “On ensuring the functioning of Ukrainian as the state language” should be changed. The draft law was already submitted to the Parliament, although it will not be considered in the coming days. It can be assumed that the speaker, who belongs to the pro-presidential party “Servant of the People”, in such a way tests the public opinion, and the President will formulate his final attitude to the language issue based on the reaction of the Ukrainian politicians and society.
Personnel issues did not go unnoticed by the President as well. V. Zelensky commented on the accusations of non-transparency of appointments to public positions and said that neither the head of the President’s Office nor the first aide influences any personnel decisions: “For all positions we hold interviews, then comes a competition.” Thus, V. Zelensky answered the journalist’s question about the fact that the President “surrounded himself with his people”.
Although the President’s press conference overshadowed other political events, the Ukrainian Parliament did not sit idly by. In mid-May, in the second reading the Parliament passed one of the vital laws — the so-called “banking law” that opens further cooperation with international financial institutions.
“Sanctions against the aggressor country, Russia, are tied to both the “Minsk” and the Crimean processes and will not be lifted without a positive for Ukraine solution to these pressing issues”
Financial Thaw in Relations with the IMF and the EU
Changes in Ukrainian legislation and the adoption of the “banking law” created the preconditions for a thaw in relations between Ukraine and the IMF. On May 7, Ukraine and the Fund switched from the previously agreed Extended Fund Facility (EFF) to the 18-month Stand-by program. The volume of loan did not change and will amount to about $5.5 billion. During the meeting with the Speaker of the Parliament D. Razumkov, G7 ambassadors emphasized the need for cooperation between Ukraine and the IMF to strengthen democracy and the economy of Ukraine. It is expected that the decision to allocate the first tranche should be made on June 5.
Some progress was noticed in the financial sphere of Ukraine–EU relations. First, the EU Representative in Ukraine, Matti Maasikas, welcomed the adoption of the above-mentioned “banking law”, and stressed its importance for continued financial assistance from the EU and the IMF. Secondly, the President of Ukraine V. Zelensky had telephone talks with the President of the European Commission Ursula von der Leyen, during which they discussed the provision of 1.2 billion euros macro-financial assistance to Ukraine.
It is already clear that Ukraine will need this money, as UNICEF estimates that, due to COVID-19 crisis, more than 6 million people in Ukraine may find themselves below the poverty rate, the poverty may rise from 27% to 44%, and the Ukrainian economy’s losses caused by the quarantine introduction could amount to $50 billion.
Scandals and Hopes
The beginning of the month was marked with a huge scandal linked both to foreign and domestic policies. In early May, President Zelensky appointed M. Saakashvili, ex-president of Georgia convicted in his home country, as the head of the executive committee of Ukraine’s National Reform Council(a subsidiary body of the Ukrainian leader). Such a decision of the Ukrainian side was not welcome in Tbilisi. Georgia decided to recall the Ambassador for consultations. The only thing that gives reason for optimism in this situation is the fact that there is no talk about the revision of bilateral relations between the countries or the termination of diplomatic relations.
Even larger scandal was caused by the so-called “Derkach tapes”, the recordings of alleged talks between the previous President of Ukraine P. Poroshenko and then Vice-President of the United States, and now the leading candidate for the President of the United States from the Democratic Party J. Biden. The scandal was caused not so much by the records as by V. Zelensky’s statement that these records could be qualified as a treason by P. Poroshenko. Washington reacted to the President’s of Ukraine statement extremely vehemently. Some former US ambassadors to Ukraine called for Ukraine not to interfere in the internal affairs of the United States, and according to unofficial information, the State Department urged Kyiv not to interfere in the US presidential race.
Among the positives in foreign policy, one can name the first post-quarantine visit paid by the Minister for Foreign Affairs of Ukraine D. Kuleba to Budapest. According to the minister, with this visit, the parties have demonstrated their readiness to seek common solutions, which is undoubted progress against the background of recent cool relations between Ukraine and Hungary.
Photo credits: Office of the President of Ukraine