You're reading: German expert Alexander Rahr: Ukraine’s oligarchs have ‘remained silent on democratic regression’

Editor’s Note: Olena Tregub, a freelance contributor to the Kyiv Post, conducted a series of interviews with German experts on Ukraine. The following is one of them.

Alexander Rahr is program director of the Berthold Beitz Center for Russia, Ukraine, Belarus and Central Asia at the German Council on Foreign Relations (DGAP). He is also the coordinator of the DGAP Research Institute’s EU-Russia Forum. He has worked as a consultant for the Rand Corporation, Santa Monica, and is member of the executive board of Yalta European Strategy (YES).

Kyiv Post: How would you assess the results of President Viktor Yanukovych’s first year of presidency in comparison to those of the previous Orange leadership?

Alexander Rahr: At the beginning of 2011, Reporters Without Borders put Ukraine 42 places lower in its annual classification of freedom of the press – placing the country just behind Iraq, with a world ranking of 131. Freedom House placed Ukraine in the category of "partially free" countries (whereas it had until then been classified as a "free country"), as a result of less press freedom, electoral fraud and the judiciary’s loss of independence. This is the difference between 2005 and now.

KP: Should the EU use negotiations on an association agreement, a deep free-trade agreement and on a visa-free regime as leverage to promote political and other reforms in Ukraine, or should these agreements be signed as soon as possible?

AR: Ukraine’s oligarchs reportedly support the DCFTA [Deep and Comprehensive Free Trade Agreement], the signing of which is currently threatened by chilly relations between Kyiv and Brussels. If [former Prime Minister Yulia] Tymoshenko is criminally charged, the EU’s relations with Ukraine will resemble those Brussels has with Belarus and Russia. This is because prosecution of Tymoshenko is seen as politically targeted repression. Brussels will change its stance toward Ukraine because Tymoshenko is symbolic as the candidate who received 45 percent (11.6 million votes) in the second round of the 2010 presidential election.

KP: Could and should the current pro-Russian German position be replaced by a pro-Ukrainian position? To what degree may domestic political changes in Germany play a role for its future Eastern policy positions?

AR: Germany has seen that Yanukovych’s first year in office provoked numerous protests from the opposition, journalists, academics, students, feminists, and business people. The German business community may be interested in doing business with Ukraine’s oligarchs, who have remained silent on democratic regression. Yet, a Putinist regime that has co-opted, exiled or imprisoned oligarchs is not likely to be something Germany would welcome. German leaders would not restrict their relations with Ukraine’s opposition, but identify and lobby those oligarchs who could be potential allies in halting Ukraine’s drift toward Putinism. Ukraine’s leaders seem to be intent on moving forward with their plans to establish a “managed democracy,” one aspect of which is the removal of the main opposition force led by Tymoshenko. The Yanukovych administration’s members’ apparent belief that they can successfully merge Putinism with European integration is fatally flawed.

KP: Do you have any specific advice for the Ukrainian government to change Ukraine’s image in Germany for the better, and improve Ukraine’s attractiveness for German investors?

AR: Ukraine proposed to transform Ukraine’s gas transportation system, consisting of large and small gas pipelines stretching for 37,000 kilometers, into a tripartite gas consortium. In addition to Ukrainian companies, it will include Russian and German firms, with each party having a 30 percent share in the consortium. The idea of establishing such a consortium may be interesting for German investors. The tripartite consortium could jointly modernize Ukraine’s pipeline and subsequently exercise joint control over gas transit to Europe. In response to Ukraine’s attempts to use its monopoly transit position for political purposes, Russia undertook the construction of pipelines bypassing Ukraine and other countries in Central and Eastern Europe. The Nord Stream pipeline laid across the bottom of the Baltic Sea is nearing completion. Yanukovych immediately realized that the new pipeline would seriously undermine Ukraine’s role in gas transit to Europe. Ukraine’s budget depends heavily on revenue generated by gas transit. Therefore, when coming to power, Yanukovych tried to persuade Russia to, at least, abandon plans to build the South Stream pipeline. In return, the struggling Ukrainian leader offered Russia a concession for the management of the Ukrainian gas transportation system, in addition to the opportunity of supplying gas directly to Ukrainian consumers. He wants Germany to help him to convince Russia to change her mind.

KP: Did the decision of prosecutors to investigate former President Leonid Kuchma for involvement in the 2000 murder of journalist Georgiy Gongadze add credibility to the current government and improve its image in the West? What are your expectations about how this case should be resolved?

AR: Ukraine has taken over the chairmanship of the Committee of Ministers of the Council of Europe, which puts it in the spotlight. Yanukovych wants to divert attention from political demonstrations against social problems and against the politics of the government (demonstrations by teachers, against the tax code etc.) and to take revenge against Kuchma.

KP: Do you think Ukraine will ever enter the EU, and, if so, under what conditions and when approximately?

AR: Yanukovych has very limited space to maneuver. Ukraine, which lacks natural resources, has scanty financial resources of its own. Therefore, Yanukovych has to rely on external assistance, or to be more precise – assistance from Russia. Kyiv can no longer count on the benevolence of its strategic partner as has often been the case in the past. Russia will dictate its own terms to Ukraine. EU membership is not realistic today.

KP: Do you think Tymoshenko’s arrest will affect the signing of an association agreement between Ukraine and the EU?

AR: Yulia Timoshenko’s arrest will not reduce the intentions of the EU to integrate Ukraine into the EU. European politicians are pragmatic in this sense and Timoshenko’s case will not abandon negotiations concerning the association agreement. The West doesn’t want Ukraine to come closer to Russia. Yanukovych’s image will not suffer because of the arrest because many do not believe he is directly connected to it.

Olena Tregub is a freelance contributor to the Kyiv Post.