Regional Report
EastWest Institute
Kyiv Centre

Ukrainian Regions: Analysis and Events

This issue was prepared in cooperation
National Anti-Corruption Program "Freedom of Choice"
Coalition of NGOs of Ukraine

Brief Summary

    The EastWest Institute is pleased to present to your attention the 14th issue of the Ukrainian Regional Report (URR). The issue was prepared in cooperation with National Anti-Corruption Program “Freedom of Choice” Coalition of NGOs of Ukraine. This issue deals with the peculiarities of Ukrainian corruption, anti-corruption strategies, role of NGOs as well as Government in combating corruption. In this issue we have attempted to evaluate the factors that cause corruption and to provide rating of the most corrupt state institutions, as well as estimate development of corruption in various regions of Ukraine. 
Expert Evaluation

    Corruption in Ukraine: To Kill a Dragon by Oleksandr Baranovsky, Head of the Analytical Department of the Accounting Chamber of Ukraine, PhD.

    The question of corruption has been vigorously discussed in Ukraine and the existence of the problem has been widely recognized. However, there is the absence of consensus within the “political establishment” and the government as to the ways of battling corruption, as well as lack of “political will” to conduct this battle. According to official data of the State Statistics, only bribery and “pay offs” are reported within the category of “corruption”, whereas corruption among high officials is ignored. Thus, based on those sources it is difficult to evaluate the actual level of corruption. Moreover, this has led to the transgression of the law and abuse of judicial procedures. For example, law enforcement organs in the Kharkiv region exposed over 170 criminals, related to bribery last year. However, court proceedings were carried out only against 71 of these individuals. 

    The Cost of Corruption by National Anti-Corruption Program “Freedom of Choice” Coalition of NGOs of Ukraine.

    The cost of corruption and the failure of the Government program to battle corruption have nudged civil society to undertake to solve the problem of corruption. For instance, the “Freedom of Choice” Coalition of NGOs has developed and started the realizaiton of the National Anti-Corruption Program. The creation of a widespread anticorruption coalition is a symbolic fact. Despite the risk of “complications” and “problems”, Ukrainian NGOs have been able to unite to develop anticorruption strategies for activities and have begun to coordinate their activities.

    The regions and the appraisal of corruption by NGO “Young Europeans for Security – Ukraine”

    The article discusses the attitude of Ukrainians towards the problem of corruption and shows different perception of corruption in different regions of Ukraine.

Individuals of the Issue
    National Particularities of Ukrainian Corruption by Ivan Sikora, coordinator, National Anti-Corruption Program “Freedom of Choice” Coalition of NGOs of Ukraine.

    Widespread corruption became the alpha and omega during the presidencies of Kravchuk and Kuchma. Although government leaders changed, corruption remained, changing its form and becoming clearer. Among the main reasons that cause Ukrainian corruption are personal devotion and relationship between countrymen as a principle of staff selection and the protectionism with regard to factories and commercial structures, which bring income to certain individuals. Under the premierships of Kuchma, Zviahliaskoho, Masol, Marchuk, Lazerenko, Pustovoitenko and Yuschenko, corruption had different faces, however there were basic common features. The Ukrainian way of combating corruption means exhibition of blaming ex-premiers in the cases, when they took the position in opposition to dominating interest groups or the President of Ukraine.

The Scale of the Phenomenon
    Large and Small Corruption by Bohdan Sikora, Director, Ukrainian Association of Social-Economic Research, Management, and Forecasting, Kyiv.

    It is not possible to effectively battle with small corruption, if big corruption is flourishing. In Ukraine only small corruption dominates in the reports of law enforcement agents as they expose “perpetrators of corruption”.

Aspects of the Theme
    Privatization between Light and the Shadows by “Center for Forecasting of Social-Economic and Political Processes”, Kyiv 

    A bright example of Ukrainian privatization with a corrupt “flavoring” is the privatization of the Open Stock Company “Mykolaiv Aluminum Company” (MAC) and Ukrainian regional energy companies. “Offshore” privatization of Ukrainian regional energy companies has led to worst operation of privatized engergy companies than the state run companies. The new owners – two groups of oligarchs – are interested in quick profits. But fast money is organically tied to bills of exchange and reciprocal schemes of work on the market and further transfer of profits from under the possibility of taxation through offshore companies.


The Economic Slice of the Theme

    The Human Factor and Corruption by the Ukrainian Association of Social-Economic Research, Management and Forecasting, Kyiv

    The new Ukrainian nation came to being with weak government institutions and corrupt control revision and court systems. Procedures were tangled, they interfered with one another, which at the end contributed to the empowering of the bureaucrats, who have exclusive powers of decision-making.

Leaders in the Process
    A Reflection of Ukrainian Television by Dmytro Vityk, expert, National Anti-Corruption Program “Freedom of Choice” Coalition of NGOs of Ukraine.

    In a society with corrupt authorities, TV cannot be non-corrupt, whether it is state or private. Most channels employ shady capital, in as much, that they cannot circumnavigate the tax legislation in order to stay afloat. Under the pressure of the world community the taboos have lessened, the tapes of M. Melnychenko can only be heard on the Internet and on western radio, and furthermore, J. Tymoshenko is shown as the only official personification of a robber-oligarch.

Point of View
    The Strategy of Battling with Corruption by Expert Group of the National Anti-Corruption Program “Freedom of Choice” Coalition of NGOs of Ukraine.

    Law enforcement, educational and prophylactic anti-corruption strategies are nice instruments in capable hands. Their effective conduct does not only require political will, but also support on the part of civil society, mass media and private sector.

International Experience
    The Choice of the Majority by Expert Group of the National Anti-Corruption Program “Freedom of Choice” Coalition of NGOs of Ukraine

    Over the last number of years international organizations – the World Bank, the International Monetary Foundation, OSCE, Council of Europe, United States Agency for International Development – have started the realization of programs aimed at fighting the corruption and increasing transparency. Civic society has begun to play an active role in anticorruption programs. An interesting example and an indicator is the experience of the Bulgarian Coalition. Currantly many interesting anticorruption projects have been prepared on the basis of experience of the World Bank and Coalition, which are now being implemented in Ukraine.

Historical Parallels
    “Rent seeking” on Regional Level by Vitaliy Zeliuk, Director of the Center for Social Research

    According to a sociological survey, which was conducted in the Poltava region, more than 90% of those questioned paid a bribe at least once in their lives. A gift to a teacher or a doctor is not even considered as a bribe. A considerable number of those questioned considered the following thesis to be the norm: “If you don’t pay – you won’t go anywhere”.

Regional Scope
    The path to transparency by Dmytro Marunych, PhD student, Faculty of Sociology and Psychology, Kyiv National T.  Shevchenko University, Kyiv

    Ukrainians consider that medical institutions, state automobile inspection, institutes of higher education, organs of municipal self-government and secondary schools as the most corrupt institutions. 58,7 % of those surveyed considered that the government is not doing anything to curb the growth of corruption or effectively fighting with it. Moreover, 77,1% of respondents agree with the fact that some activities of government structures even support the widespread growth of bribery.

    Ivano-Frankivsk region is infected with bribery by Ivan Kostiuk, Correspondent of Ukrainian Service of RFE/RL, Ivano-Frankivsk

    Ivano-Frankivsk region rates among the top regions of Ukraine, where the number of officials held for acts of corruption is extremely high. However, municipal judges consider most of those accused of corruption as accused without substantiation. 

    Corruption Foreve. An Example of Dnipropetrovsk by Oksana Bohdanova, Independent Journalist, Kyiv-Dnipropetrovsk-Kyiv

    In Dnipropetrovsk everyone is fighting corruption, but it is like a hydra – you cut off one head, and two grow back in its place. But only due to real desire of the authorities in Kyiv to reveal those involved in corruption from the high cabinet positions will make it possible to bring about changes. 

    Current Law on Corruption is “Ineffective”

    The head of the Committee of the Verkhovna Rada in regard to the question of fighting corruption and organized crime, Yuri Karamazin, on February 21, at a meeting of the press-club of market reforms noted, that the current law on corruption is “ineffective”, and using it as an aid in trying to battle corruption “within the ranks of higher officials” is currently not possible. 

    The Luhansk Paradigm

    Member of the Verkhovna Rada (the Parliament of Ukraine) and head of the Committee of the Verkhovna Rada in regard to the question of fighting corruption and organized crime, Yuriy Karamazin in a live broadcast on the Kyiv Television Company “Yutar” on the 7th of February accused the Governor of Luhansk Oblast O. Iefremov in his relations to corruption. At the same time the pro-presidential fraction “Labore Ukraine” sent a group of deputies to Luhansk by chartered airbus, in order to block the anti-corruption committee of the Parliament.