Minsk series part IV: oligarchs versus compradors
So far, this series on the Minsk agreements (part one, part two, part three) has focused on how Ukrainian liberals critiqued them. Now we will examine the struggle in Ukrainian society over Minsk. After 2014, leftwing forces were made illegal and social democratic forces (the remnants of the Party of Regions) were restricted in various ways on grounds of being a ‘pro-Russian fifth column’. Only one force interested in a cessation of military hostilities and a weakening of the middle class maidanite liberals remained – the Ukrainian industrial oligarchy.
Oligarchic pro-Minsk counter-offensive
Ukraine’s formerly pro-maidan oligarchy began its open demarche in support of Minsk towards the end of the Poroshenko presidency, as they prepared to push Zelensky to power on a peace platform.
Ihor Kolomoisky, one of Ukraine’s richest oligarchs, was an enthusiastic propagandist of the western vector for Ukraine since the early 2000s, actively supporting everything from the orange revolution to Euromaidan with his media group 1+1. Interviewed by Mustafa Naiem (more on whom later) in 2008 for Ukrainskaya Pravda, he called himself a ‘Yuschenko fanatic’, since stocks in Kolomoisky’s business increased in value following the 2004 Orange Revolution in which Viktor Yuschenko became president.
Kolomoisky did quite well for himself at first after maidan, spending $10 million a month creating a rightwing ‘volunteer army’ to fight separatism in the east, then occupying state-owned enterprises with this new private army. The early years following Euromaidan were also an opportunity to become the governor of ‘his’ home region of Dnepropetrovsk and ruin his business rivals in Donbass - in many ways, post-Soviet Ukrainian history has been the story of the Donetsk-Dnepropetrovsk oligarchic rivalry.
But he got tired of the post-2014 order. Partly, certainly, because the IMF was uninterested in tolerating him, and pushed the Ukrainian government to try to remove various crucial assets, particularly ‘PrivatBank’, from Kolomoisky’s grip. International capital has no need for a greedy Ukrainian national bourgeois.
More simply, eight years of war and extreme economic austerity had been bad for the economy. No matter how unproductive his business practices might be, Kolomoisky and other Ukrainian oligarchs still have more economic interest in the survival of the Ukrainian economy than the IMF and radical patriots on foreign NGO payrolls in Kiev.
And full-blown war with Russia, always a risk if the war in Donbass wasn’t resolved through a comprehensive peace agreement, would ruin the Soviet industrial carcass whose slow dissection and digestion oligarchs like Kolomoisky depended on. As a result of the 2022 full entry of Russia into the war in Ukraine, the economic assets of Kolomoisky and other oligarchs have been destroyed by military actions or annexed by Russia, with others nationalized by the Ukrainian government.
Kolomoisky’s wealth, once valued at over $2 billion, dropped below $900 million in 2023. Rinat Akhmetov, Ukraine’s richest man, saw his net worth decline from $15.4 billion in 2013 to $5.7 billion in 2023. Kolomoisky himself has been arrested and is currently being prosecuted in court, an affair that is, needless to say, quite murky.
By the time of the 2019 elections Kolomoisky had had enough. He supported Zelensky against Poroshenko with all his media might. According to his 2019 interview, all of Ukraine’s oligarchs had decided ‘several years’ before 2019 that Poroshenko had to be replaced by Zelensky. Poroshenko had plenty of business ambitions of his own, being one of Ukraine’s richest men (in 2015, Poroshenko was the only one of Ukraine’s top businessmen whose wealth increased), and was a hardcore pro-west militarist. Zelensky, meanwhile, was running on platform of peace by any means, famously stating his openness to ‘negotiating with the devil if necessary’. He was excoriated by euro-atlantic publications at the time as being a Kremlin stooge.
Zelensky’s pre-election promises already seemed to augur an implementation of Minsk. But one of his main sponsors, Ihor Kolomoisky, broached the topic explicitly, giving a scandalous interview in 2019 for the NYT:
Mr. Kolomoisky, widely seen as Ukraine’s most powerful figure outside government, given his role as the patron of the recently elected President Volodymyr Zelensky, has experienced a remarkable change of heart: It is time, he said, for Ukraine to give up on the West and turn back toward Russia.
“They’re stronger anyway. We have to improve our relations,” he said, comparing Russia’s power to that of Ukraine. “People want peace, a good life, they don’t want to be at war. And you” — America — “are forcing us to be at war, and not even giving us the money for it.”
In a 2019 interview for the Ukrainian publication New Voice, he repeated the sentiment:
the war in Ukraine is an internal civil conflict. It's not inspired by anyone, let alone by Russia. Russian weapons and soldiers are there only so long as the conflict continues. And we have American weapons on our side, don't we? The US gives Ukraine weapons because it is profitable for them if the conflict continues. But don't forget that this is our internal conflict, that has been preparing for at least 20 years, since the 2004 Yuschenko/Yanukovych elections.
Straight out of the Russian propaganda playbook! Subjectivizing Donbass as having long-standing political claims, claiming that the US is fighting Russia to the last Ukrainian…
Kolomoisky wasn’t the only one. Viktor Pinchuk also engaged in pro-Minsk treason even earlier. This was even more remarkable, given that Pinchuk had perhaps the longest pedigree as Ukraine’s most pro-western oligarch. Pinchuk set up the annual Yalta European Strategy organization in 2004 to lobby for Ukraine’s euro-atlantic integration, his media empire gave highly pro-maidan coverage in 2013-14, and he funded a vast constellation of ‘pro-European civil society’.
But Pinchuk decided to swallow his past with his 2016 article for the WSJ titled ‘Ukraine must make painful compromises for peace with Russia’. The title says it all. In it, he proposes:
‘temporarily eliminating European Union membership from our stated goals’
accepting that ‘Crimea must not get in the way of a deal that ends the war in the east on an equitable basis’ (and hence its ownership should not be discussed for at least 15-20 years, after a Ukrainian economic miracle that would result in Crimeans willingly joining Ukraine a la east/west Germany)
‘accept[ing] local elections’ in Donbass despite the fact that ‘conflict in the east was initiated from abroad’
‘Finally, … accept[ing] that Ukraine will not join NATO in the near- or midterm. The offer is not on the table, and if it were, it could lead to an international crisis of unprecedented scope. For now, we should pursue an alternative security arrangement and accept neutrality as our near-term vision for the future.’
Quite the affront to those influential Euro-optimists like Garmarsh, who considered non-alignment to be ‘criminal'!
The comprador anti-Minsk counter-offensive
As we have seen, war was a real threat for Ukraine’s oligarchs and their material assets. War didn’t pose the same threats for journalists like those of Ukrainskaya Pravda, whose paychecks come from USAID, or, since 2021, George Soros. Indeed, increased wartime attention from western media and governments is hardly a bad thing for them. Arseniy Yatsenyuk, a key representative of such forces, has even praised the war’s ruinous effects on the oligarchy - "On the one hand this war is a crisis, but on the other hand it is a perfect chance and opportunity to reform Ukraine”.
The clash of economic interests was quite tangible when it came to critics of Pinchuk’s suggestions. Mustafa Nayyem took it upon himself to respond – one could not find a more impeccable old guard of the 2014 revolution. The initiator of Euromaidan took it upon himself to suppress attempts at counter-revolution.
Nayyem viciously took apart Pinchuk’s article, itself ironic considering how much of Pinchuk’s money Nayem, as a progressive eurointegrationist journalist, himself must have been given by Pinchuk’s funds over the years. Nayyem called Pinchuk’s WSJ article a ‘capitulation to Moscow’.
Nayyem’s article for Ukrainskaya Pravda is titled ‘a Compromise Mustn’t be a Capitulation’. The ‘Capitulation’ reference is one where, as usual, liberals and rightwingers converged, with Azov-led protests against the Minsk agreements in 2020 calling themselves ‘No Capitulation!’
Nayyem’s justification for his EU-optimism is very interesting. In his words, ‘for many sober and rational people in Ukraine, joining the EU is less an aim in itself, than an orienteer, movement towards which allows changing many processes in the economy, energetics, the state sector, law enforcement, and societal relations’.
Even for the most ardent euro-optimists, years of polite refusals by the EU must have made it clear that it might be worthwhile justifying their societal importance by means other than the promise of joining the EU. Following Maidan, Nayyem propelled himself into the cockpit of some of Ukraine’s top state owned enterprises. He was particularly known for overseeing Ukroboronprom’s decline, Ukraine’s state military company. Despite the journalist’s promises to eradicate corruption, he was implicated in financial scandals while occupying top posts at the company.
Back in the early days of the post-maidan order, it might have been easier to justify the painful reforms conducted by Nayyem and his ilk on the grounds that ‘the EU demands it as a condition for entry’. But after several years, it became harder to pretend that this entry was on the table. Nayyem tried to salvage the argument by arguing that even if Ukraine wouldn’t join the EU, Ukraine still had to implement the liberal reforms demanded by the EU, simply due to their intrinsically progressive nature.
This argument is mirrored in a 2017 UP column by Sergei Sidorenko against Pinchuk’s ‘Capitulation Plan’. According to Sidorenko, ‘It must be recalled that the path to the EU is determined by the Ukrainian people, and Pinchuk or Filipchuk [an influential journalist who wrote an article echoing Pinchuk’s arguments] taken separately will not change this fact. That the EU is both a valuable choice and a choice of the way to reform the country. Yes, again about reforms, but this is key’ (my italics).
It is liberal economic ‘reforms’ which are ‘key’ in and of themselves, which rule out implementation of Minsk and which require, in the next paragraph, a ‘strengthening of the Ukrainian army’ and ‘more cooperation with NATO’.
Class geopolitics of the anti-Minsk Samurai path
In the Ukraine created by the ‘orienteer’ of economic austerity and liberalization, Nayyem and his ilk are the helmsmen. They may lack any realistic aim, but after all, the samurai has no goals, only the path. Furthermore, keeping this pro-EU ‘orientation’, even if means no prospect of actually joining the EU, does mean plenty of money coming from the EU into Ukraine for various projects ‘developing democracy’, where Nayyem and his colleagues in the NGO ecosystems are eager recipients.
A Ukraine without total hegemony of pro-EU liberal forces – one where Minsk was implemented, where Donbass was reintegrated into the Ukrainian polity – would mean less EU grants. Donbass, the capital for industrial, anti-euroatlantic political forces, would make it impossible to implement ‘much-needed liberal reforms’. Lacking any perspective of imposing their project, why should the EU continue funding its agents of influence? The flow of western grants wouldn’t dry up, but it would certainly decrease.
It is worth discussing a question that I am often preoccupied by, and which Volodymyr Ishchenko has explored in his work. Why are these ‘brave reforms’ so desired by Ukraine’s western partners, even if they have proven highly counter-productive in preparing Ukraine for war with Russia? I believe that the class conflict I have described between the oligarchy and the comprador middle classes plays a key role.
Not only are these reforms desired by the EU for economic reasons, opening Ukrainian markets to European imports and the like, but they actually serve a crucial political purpose. By deindustrializing Ukraine, such reforms also hollow out the class forces opposed to Ukraine’s ‘euro-atlantic future’ – the working class and the industrial oligarchy. Hence, the struggle for economic liberalization occupies the nexus between economic interests and geopolitics. Destroying the last remaining pro-peace (‘pro-Russian’) forces in Ukraine was of utmost importance in gearing up Ukraine for war with Russia in the post-2014 period.
Only the middle class ‘civil society’ was totally dependent on the west. While particular circumstances led to oligarchic support for euromaidan in 2013-14, they also had their own interests, which didn’t always mesh with those of the west. Why should NATO planners tolerate any independent, stubborn forces in its military rampart of Western Civilization?
Indeed, the trade liberalization proposed by the victors of maidan was quite obviously directed against the oligarchy, who depended on industrial protectionism, and some of whom harshly critiqued the biased nature of the free trade agreement with the EU.
Ukraine’s neo-colonial trade relations with the EU hence had the effect of killing two birds with one stone – it both tied the economy to the EU and its geopolitical imperatives, and economically weakened the ‘pro-Russian oligarchs’. So went the ‘anti-corruption’ gospel, according to which all problems were due to insidious ‘Russian corruption’.
The struggle over Minsk was hence not just, or even primarily a struggle regions, but a struggle between different economic classes. On the one hand, upwardly mobile middle class ‘political activists’ who depend on western grant money, paramilitary groups whose existence depends on the continuation of military actions and western military funding, and politically cunning businessmen such as Poroshenko who make money by controlling the state apparatus and smuggling routes created by the war.
On the other hand, the business and laborers linked to the Soviet industrial skeleton. Pinchuk and Kolomoisky were not alone among big businessmen in supporting Minsk – Viktor Medvedchuk and Vadim Novinsky released their own pro-Minsk (Novinsky claimed that his plan didn’t involve implementing Minsk, but in reality that was just politically correct semantics) peace plans in 2019 and 2018, respectively.
The industrial working class, concentrated in Ukraine’s south-east, provided the electorate for pro-Minsk political parties like Medvedchuk’s ‘Opposition Platform for Life’. Nor were they an outlier in Ukrainian society. Throughout the post-Maidan period, even though millions of anti-EU Ukrainians (residents of Crimea and the L/DNR) were no longer counted, polls showed that pro-EU sentiment fluctuated between 50-65 per cent. They also showed that the lower one’s income, the less likely one was to support euro-atlantic integration.
National surveys also showed that over 70 per cent of Ukrainians were unsatisfied with the direction that Ukraine had taken following Maidan. Unsurprising, given that according to Ukrainian state statistics, 54 per cent of Ukrainians earned $280 or less a month—by 2020, 85 per cent earned $291 or less (taking into account dollar inflation).
In other words, the potential for a defeat - Minsk - of the euroatlanticists by public opinion and economic kingpins was quite real. 2022 put a stop to that.
Excellent analysis! Many thanks on what Minsk means for Ukraine!!