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Thursday, July 18, 2024

The puppet is pulling the strings: How Zelensky’s regime manipulates its Western backers

The removal of officials favored in Washington and Brussels but inconvenient for Kiev is starting to resemble a purge

As a state, Ukraine is vitally – or fatally – dependent on the West: As the Ukrainian anti-corruption activist Martina Bohuslavets notes in the staunchly patriotic Ukrainska Pravda, Kiev’s “international partners finance not only the reconstruction of critical infrastructure, but also all…pensions, public employee salaries, and, in general the country’s ability to keep going.”

This is no exaggeration. Consider some figures from The Economist: The Ukrainian state budget for this year amounts to $87 billion; expected tax revenues – $46 billion. “The rest,” the British champion of uncompromising struggle against Russia concludes, “must be filled by foreign aid or borrowing.”

To a large extent, this Western financial support has been forthcoming. According to the Kiel Institute for the World Economy, which tracks these funds systematically, between January 2022 and April of this year, the West as a whole had funded Ukraine to the tune of €176 billion in already allocated aid. In addition, there is €100 billion in commitments that has not yet been allocated. It is true that some aid figures are politically inflated. The recent US package of $61 billion, for instance, really only amounts to $31.5 billion that is actually going to Ukraine; the rest is, in essence, a gift to America’s own Department of Defense. Yet there can be no doubt that, without Western funding, Kiev would have to stop the war and many ordinary peace-time state operations as well.

Against this backdrop, it would seem that Ukraine’s Western donors should have an extraordinary degree of leverage over the Zelensky regime. But things are more complicated, as a recent ouster has shown. On June 10, Mustafa Nayyem resigned from his position as head of Ukraine’s State Agency for Reconstruction and Infrastructure Development. The Reconstruction Agency, which has grown out of the country’s bureaucracy for maintaining roads, highways, and bridges, has a broad remit. With a budget worth $2.5 billion of foreign aid, its tasks now also include, for instance, the maintenance and repair of water supply systems, the building of military fortifications and protections to shield energy structures from Russian aerial attacks.

Clearly, this is an important office. As it happens, Nayyem resigned on the eve of an important meeting in Berlin about precisely the issue of reconstruction, bringing together Western supporters and Ukrainian representatives, led by Vladimir Zelensky himself. Nayyem was expected to attend as part of the large Ukrainian delegation but was barred at the last minute by order of Ukrainian Prime Minister Denis Shmigal, clearly acting on Zelensky’s behest. That was an extremely unusual and humiliating move. Nayyem really had no choice but to quit.

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He made no secret that he felt pushed out. In a long Facebook post, reproduced on the semi-oppositional Ukrainian news site Strana.ua, he complained that his agency had been, in essence, sabotaged for at least half a year: its operating budget severely cut, its work routinely crippled by bureaucratic chicanery, and its personnel disincentivized by massive wage cuts. For the future, he warned that long-standing attempts to “persecute and discredit” his team and himself might intensify.

And at the root of all of this? Nayyem, unsurprisingly did not name names, but observers in and outside Ukraine agree that he had run afoul of Ukraine’s presidential administration, its head Andrey Yermak, Zelensky himself, and Shmigal, too. There seem to be three reasons for their drive to get rid of Nayyem: First, while not averse to being paid very well, he is a former investigative journalist with a record of resisting corruption: He has insisted on transparency and accountability in his agency, going so far as to help Ukraine’s Anti-Corruption Bureau nail two members of Ukraine’s parliament trying to offer bribes for contracts. Second, he has excellent contacts with representatives of Western governments, about which more below. And third, Nayyem is closely linked to the former minister and vice prime minister Aleksandr Kubrakov. Kubrakov, whose portfolio also included infrastructure and development, was ousted in May, and, again, like Nayyem, combined intense contacts with Westerners and a lack of connections to Zelensky’s core team. In his case as well, it is obvious that the latter initiated his downfall.

One factor that deserves special mention is that Nayyem’s now former area of activity – reconstruction – has two sides: wartime and postwar. There is a general consensus that postwar reconstruction will require enormous financial efforts: The World Bank estimates a cost of almost $500 billion, as of now. While the figure reflects horrendous destruction, for some, in and outside Ukraine, it signals fortunes to be made, legally and especially illegally. Insofar as Nayyem is no “team player” when it comes to taking one’s cut – and letting others take theirs – his place in Ukrainian (and Western) politics was always anomalous; and he certainly could not be allowed to stay so close to a portfolio so rich with future enrichment opportunities.

First Kubrakov, then Nayyem; and before the two, the former commander-in-chief of Ukraine’s military, General Valery Zaluzhny. That makes three high-ranking Ukrainian officials favored by the West yet removed by the Zelensky regime. Even when Nayyem had not yet been added to the list, the Financial Times – clearly often used to send unofficial and critical signals to Kiev – was warning that Zelensky’s “little explained removal of top government and military officials,” with whom the US and EU liked to work was causing concern about his “disruptive and inexplicable moves.”

And yet, those warnings have obviously been in vain. After Nayyem’s forced departure, what Ukrainian insiders explain as a purge of anyone in Kiev with their own links to Western backers has triggered another, even more explicit admonition in the FT. Under the headline Ukraine’s top reconstruction official quits in new blow for Zelenskyy,” readers – including in Kiev – learn that “Nayyem’s departure is the latest in a series of personnel changes in Kyiv that have shaken the confidence of western partners” in the Zelensky regime. Richly endowed with strategically leaked information, the FT delivers details about how exactly Shmigal snubbed Nayyem and, more importantly, about recordings made at an earlier meeting between the latter and “two dozen representatives from the United States Agency for International Development (USAID) and other western agencies” at which Nayyem warned them that he would be fired soon.

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On that occasion, Nayyem’s assurances that his agency’s work would nonetheless remain on track was met with skepticism by several Westerners. An American representative underlined that working with Nayyem’s team was “probably our most important partnership.” After Kubrakov’s dismissal in May, Western diplomats in Kiev launched, it is now revealed, a “coordinated display of support for Kubrakov and the western frustrations over Zelenskyy’s government.” On May 13, a meeting between several of them and Prime Minister Shmigal deteriorated into “a heated discussion” about both the removal of Kubrakov and the freezing-out of Nayyem.

While the FT has fired the loudest new warning shot at the Zelensky regime, other major Western publications have done their bit as well: Bloomberg, The Economist, The New York Times, for instance, all have come out with articles lamenting Nayyem’s ouster and deploring “infighting” in Ukraine, “growing concerns” among its Western donors, and, last but not least “awkward timing.” If anyone in Kiev was still in doubt about Nayyem’s Western backing, the disproportionate response to his removal should take care of those.

Yet, here is the crucial question: What difference does it all make? As of now at least, none at all. It is almost as if the media brouhaha is compensation for the fact that, in reality, the Zelensky regime is getting away with not giving a damn about all the Western tut-tutting. The Berlin meeting was all smiles, and the G7 is moving ahead with a scheme to “lend” Ukraine another $50 billion. “Lend” in quotation marks, because the money will be paid back from interests accrued on Russian sovereign assets frozen in the West.

It is, of course, possible that funding for Ukraine will decline in the future. But if so, then that will have to do with factors such as the rise of the far right in EU politics or Donald Trump winning the US presidency again, which, according to The Economist, he currently has a two in three chance of doing. Ukraine’s corruption will not make a difference, and neither will Western protests when their favorites get chopped down. Zelensky and his team know this. They understand the obvious: that their true value for the West is to keep offering their country and its people as resources in a proxy war driven by geopolitics, and that the West itself does not have an exit strategy. That is their leverage, the typical leverage of the proxy regime, when its foreign sponsors have gotten in too deep.

June 16, 2024 at 12:19AM

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