While inside Ukraine October was marked by some political turbulence, in the international arena the situation was quite stable, if not favorable. It seems that Europe is not as tired of Ukraine as Moscow would like it to be. However, it is not entirely clear to what extent the political events of October, many of which will have “long-term implications”, will affect the subsequent development of the country. After all, the Zelensky’s team mono-majority seems to have come to an end, a constitutional crisis is brewing in the country, and the support of partners is not unlimited.
Domestic policy
Local election: a new alignment of forces in the regions of Ukraine
In October, the local election, held on October 25 throughout Ukraine, except for the temporarily occupied territories of Crimea and Donbass, was undoubtedly the main event in the country. The main intrigue of the autumn election marathon hinged on one question: will the pro-presidential party in power, Servant of the People, repeat its last summer’s triumph? No miracle happened.
First, voter turnout during the 2020 campaign was the lowest in the whole elections history in the independent Ukraine (which can be interpreted both as fear of the coronavirus and as disappointment in “new faces”). And secondly, the local electorate gave its sympathies mainly to proven mayors and their parties. In all major cities of Ukraine, from Kharkiv to Lviv and from Kyiv to Odesa, the former mayors remained at the helm.
And with the so-called presidential “poll”, the situation looks very ambiguous. In mid-October, President V. Zelensky in his video message said that on the local elections day he would pose five questions to compatriots. Such an “initiative” from the head of the state caused a critical reaction. According to the Constitution of Ukraine, the president is not endowed with such powers. And the announced president’s “poll” is, at least, beyond the legal field of Ukraine. The issue of financing the presidential initiative also sparked a heated discussion. After all, this is taxpayers’ money, or party money, which, according to the current legislation, indirectly is also taxpayers’ money.
The Constitutional Court of Ukraine also added fuel to the domestic politics fire. By its decision of October 27, the panel of judges recognized criminal article #366-1, which provides liability for inaccurate declaration of income by the civil servants, as non-compliant with the Constitution. According to the CCU, criminal liability for committing such offences is excessive. The decision will have long-lasting consequences, both in the Ukrainian society and domestic affairs and in relations with the Western creditors. At its core, it curtails and stops a set of laws and measures to combat corruption.
“On October 27, the Constitutional Court of Ukraine recognized criminal article #366-1, which provides liability for inaccurate declaration of income by the civil servants, as non-compliant with the Constitution.”
Economy
“Banking opposition”
Series of scandals shook the National Bank of Ukraine. In early October, on a National Bank Council’s meeting, among other topics, several financial, organizational and personnel issues were discussed. In particular, the NBU Council decided to reprimand the First Deputy Governor of the NBU Kateryna Rozhkova and the Deputy Chairman of the Board of the National Bank of Ukraine Dmitro Sologub, and express incredulity to them. Let us remind you that both persons are to some extent “proteges” of the previous head of the board, who resigned the summer. The reasons for this decision are allegedly the violation of the regulatory acts of the National Bank.
The main financial donor of Ukraine, the IMF, reacted with lightning speed. The IMF Resident Representative Mr. Gosta Ljungman noted that ensuring the NBU board responsibility should be carried out in accordance with the fundamentals of the National Bank governance. The governance criteria were developed jointly in consultation with the IMF specialists. And decisions of this kind, made by the Council of the National Bank, undermine the credibility and authority of the regulator, primarily at the international level. It should be mentioned that the independence of the National Bank is one of the key points of the agreements between Ukraine and the IMF.
The US Embassy did not remain aloof from these events. They noted their concern about the reprimands for Rozhkova and Sologub. Also, the American diplomatic mission said that a strong and independent National Bank is critically important for the further economic development of Ukraine.
But the partners’ concern did not help the “disgraced bankers” from the “old team” and in late October Rozhkova was deprived of her powers in the field of banking supervision.
Foreign policy
Continuous support from Western partners
Traditionally, autumn brought revitalization to the international agenda. A number of official visits of representatives of the highest echelon of power abroad took place. At the same time, some partners visited Ukraine. In early October, the President of Ukraine paid an official visit to Brussels, where the 22nd Ukraine-EU Summit took place. Agreements on cooperation in the fight against coronavirus, actions aimed at a ceasefire in Donbass, and further reforms in Ukraine became the main results of these meetings. The Ukrainian delegation was headed by President V. Zelensky, the EU side was represented by the President of the European Council Charles Michel and the head of European diplomacy Josep Borrell. During the negotiations, they paid attention to macro-financial stability and NBU independence issues. Also, the EU representatives once again expressed their full support for Ukraine in its fight against the aggressor, the Russian Federation.
After his visit to the EU capital, the president left for Britain, where he also had several official meetings. The Constitutional Guarantor met the members of the Royal Family and had a meeting with the British Prime Minister B. Johnson. During a two-day visit to Great Britain, two strategic documents were signed between the countries. The first of them is a memorandum, which provides for the re-equipment of the Naval Forces of the Armed Forces of Ukraine. In particular, they mean the joint production of missile boats and loan guarantees for these needs from the British government, about £1 billion for more than 10 years. The second document is the Agreement on Political Cooperation, Free Trade and Strategic Partnership, which will replace the Association Agreement in Trade with Britain after its final Brexit. The head of the UK government said that the commitment to Ukraine is “strong as a rock” and that Britain is 100% with Ukraine.
As for the visits to Ukraine, in mid-October, Polish President A. Duda paid an official visit to Kyiv. The presidents discussed a number of burning issues. In a joint statement, the Ukrainian side once again acknowledged Poland’s unwavering support in the fight against the Russian aggression. The Ukrainian leader also stressed the role of Poland as a “locomotive” of the Ukraine’s interests in Europe. In particular, they emphasized the common position on the Nord Stream 2 project (a Russian gas pipeline bypassing Ukraine, Poland, directly to Germany, which makes Europe’s energy security dependent).
But in October, Ukrainian focus was not Europe alone. On October 16th, the head of the Ukrainian State visited Turkey. During the visit, the heads of the states touched upon a wide range of issues: from the NATO membership to the de-occupation of the Crimea. They had separate discussions on cooperation and security in the Black Sea region within the framework of the regional mechanisms and the NATO mechanisms.
In general, the visits confirmed the partners’ attention to Ukraine and their readiness to develop strategic cooperation with the EU, Britain, and Turkey.
22nd Ukraine-EU Summit
Photo: Reuters
