Three November Challenges for Ukraine: “COVID”, Anti-Corruption and Financial Ones

Sergey Gerasymchuk, Foreign Policy Council “Ukrainian Prism”

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November provided an abundance of alarming indicators for Ukraine. Against the backdrop of rising coronavirus cases there is also a threat of financial crisis, while the spread of corruption is adding oil to the flame of the crisis clearly seen on the horizon. 


Domestic Policy

Fighting Coronavirus and the Virus of Corruption 

November saw new anti-records of COVID-19 infected people – over 16 thousand in 24 hours. In mid-November the government of Ukraine, taking into account such large numbers, launched the so-called weekend lockdown. Every Saturday and Sunday, starting from November 13 to November 30, restrictions were introduced for many businesses. The lockdown, however, did not concern grocery shops, pharmacies and petrol stations. According to Maksym Stepanov, the minister of healthcare, the weekend lockdown was not as effective as expected, with the ministry not intending to recommend the prolongation of such a lockdown. 

However, if changing the course of the epidemic is quite difficult for the government due to some natural reasons, it is still possible to contribute a fair share when it comes to fighting the corruption. The vacuum of the anti-corruption legislation after the notorious decision by the Constitutional Court of Ukraine on October 27 still remains (following the October decision of the Constitutional Court of Ukraine, criminal liabilities for providing false information in asset declarations for state employees were lifted). It was only after a month that president V. Zelensky submitted to the Verkhovna Rada of Ukraine his version of the bill on liability for lies in asset declarations. In particular, the bill foresees milder punishments, with a separate article suggesting introducing liability for the absence of declaration. At the same time the President of Ukraine appealed to the Venice Commission asking them to provide an assessment on the state of anti—corruption legislation after the decision made by the Constitutional Court of Ukraine. Among other things the head of the country asks for an assessment on the decision made by the CCU judges given the possible conflict of interests.  

However, anti-corruption battles did not stop. On November 30, the working group of D. Razumkov, the speaker of the Parliament, registered a bill on the return of liability for lying in asset declarations without imprisonment. The bill suggests a fine, with the worst sentence limited to public work. With such an approach this fight with “cancer tumors” of corruption may turn into profanation. The only thing that keeps those in power from dramatically eradicating anti-corruption reforms is dependence on financial and political international assistance and, therefore, the opinions of international partners. 

The notorious October decision of CCU led to the High Anti-Corruption Court of Ukraine being forced to shut down some ongoing cases on false declarations. Among other things a case against the MP of the 8th convocation in case of declaring false information was closed. Such a tendency may continue, and, most probably, will become an avalanche until this juridical vacuum is filled. 



“The only thing that keeps those in power from dramatically eradicating anti-corruption reforms is dependence on financial and political international assistance”




Budget Deficit and Attempts to Dave the Day 

The Ukrainian public found out from the interview of Sergei Marchenko, the country’s minister of finance, that there is a “hole” in the budget of the country equivalent to $3 billion, and in the near future this money is nowhere to be found. The minister said that while this situation is complicated, it can still be controlled. It is also worth mentioning that such budget deficit is a result of Ukraine not getting IMF tranches since not all 10 structural reforms were implemented, and they are essential to opening a window of opportunity for international financial assistance. The visit of Kyrylo Shevchenko, the chairperson of the National Bank of Ukraine, to Washington D.C., did not help the situation either. Except declarative statements and common phrases, the result was next to zero. The parties “agreed to come to an agreement”. 

Since cheap Western loans are almost a single tool for Ukraine to partially cover budget deficit and restock its gold and foreign currency reserves, it was already in mid-November that the president of Ukraine V. Zelensky had a telephone conversation with Kristalina Georgieva, the Managing Director of the IMF.  In the course of the conversation the Ukrainian leader noted that all structural reforms necessary for reviewing the IMF program, had been fulfilled. The statement of the president is somewhat different from the statements made by the minister of finance. According to the latter, Ukraine fulfilled 4 out of 10 structural reforms. The IMF mission, which was supposed to come to Ukraine already in September in order to evaluate stand-by arrangement program, did not come and is not expected until next year. Therefore, financial injections from the biggest donor are not to be expected. It is also worth mentioning that other programs of international financial assistance are directly connected tothe IMF program. Ukraine desperately needs international financial assistance – this can be demonstrated by the fact that already on November 20, Denys Shmyhal, the prime minister of the country, had a video conference with the director of the European Department of the IMF Alfred Kammer. Among other things the head of the government expressed his hopes that the Fund will give a positive signal on the support of agreements between Ukraine and the European Commission regarding yet another tranche of macro-financial assistance in the short term. 


Foreign Policy

Constitutional Crisis and International Response 

The last month of autumn 2020 did not see the abundance of foreign policy developments. However, to be completely fair it is worth noting that the issue of the notorious decision made by the CCU regarding the fight with corruption and milder sentences for committing such crimes prevailed on the international arena as well. 

In early November the EU called on Ukraine to restore its anti-corruption legislation, which is one of the conditions for financial assistance and visa-free regime. Several days later G7 ambassadors discussed with Dmitry Razumkov, the Rada’s speaker, “quick solutions” to resolve the constitutional crisis started by the decision made by the Constitutional Court of Ukraine. In her turn the German ambassador expressed her doubts regarding the ability of CCU to fulfil its constitutional obligations. At the same time US embassy made more reserved comments and called on a dialogue to resolve the constitutional crisis. The president of Ukraine contributed a fair share when it came to overcoming the constitutional crisis in the country and supporting such aspirations, in particular on the international arena. In the course of a video meeting with G7 ambassadors V.Zelensky expressed his visceral response to the decision by CCU, mentioned above. 


Protests under the Constitutional Court of Ukraine
Photo: UNIAN (Vyacheslav Ratynsky)