The New York Times: corruption in Ukraine negatively affects its armed forces

In January, almost four years after the start of the war against the militias armed with Russia, the Ministry of Defense of Ukraine proudly announced that it had managed to improve the quality of medical care for its wounded through the purchase of 100 new ambulances. But while no one mentioned that many of these machines have already broken.

Фото: Depositphotos

Or that these cars were sold under a non-competitive contract by a car company that is owned by a high-ranking official responsible for procurement for the Ukrainian armed forces. Or that this official - Oleg Gladkovsky - is an old friend of Petro Poroshenko. He writes about it New York Times, and the translation of the article was prepared by Inosmi.

Ukraine’s defense and security expenditures rose sharply after the outbreak of armed conflict in the east of the country in 2014: in 2013, they accounted for about 2,5% of GDP, and this year will be about 5% or about 6 billions of dollars.

This increase in defense spending, thanks to which in 2018, procurement costs for the army will exceed 700 million dollars, allowed Kiev to restore its declining armed forces and effectively fight against the pro-Russian militia and their well-armed assistants from Russia.

However, since a huge amount of money passed through the hands of Ukrainian officials and businessmen — often the same people — the rising defense spending also played the role of a powerful deterrent in the fight against corruption, which many consider to be the main enemy of Ukraine.

This problem was the main reason for losing the hopes that the people had in February of 2014, when the pro-Russian President of Ukraine, Viktor Yanukovich, who became famous for his corruption, lost his post. She also made disappointed supporters of Ukraine in the West and many Ukrainians doubt that, after two revolutions, this country will be able to cope with chronic corruption this time.

“It makes no sense for Ukraine to fight for its body in the Donbass if it donates its soul to corruption,” US Secretary of State Rex Tillerson warned last year mentioning the eastern regions of Ukraine seized by Russian-backed separatists after the overthrow of Mr. Yanukovich.

Since 2014, Ukraine has made significant progress in its attempts to eradicate corruption in the gas sector, which was the main source of income for corrupt oligarchs under Mr. Yanukovych. It rebuilt the state-owned energy company Naftogaz and reduced the number of dishonest gas deals made by insiders, reducing its dependence on gas supplies from the Russian energy giant Gazprom.

However, the growth of military spending has opened up new opportunities for muddy transactions, protected from checks by a veil of secrecy that hides the details of defense spending.

“The level of corruption in the energy sector has decreased, so corruption has shifted to the defense sector,” said Olena Tregub, secretary general of the Independent Anti-Corruption Committee on Defense (Independent Defense Anti-Corruption Committee) - An analytical group that receives funding from Western sponsors.

Although Mr. Gladkovsky acknowledged that an open tender did not precede the purchase of ambulances, there is no evidence that he had agreed to buy these cars from his company in some unfair way, and Mr. Gladkovsky himself denies it. However, this blatant fact of conflict of interests is just one of many similar examples in Ukraine, where business and political power are intertwined in a tangled tangle of overlapping, vague and often very profitable transactions.

“There is no evidence that he has somehow influenced the decision-making process, and there will never be any. All this is a secret, said Viktor Chumak, an independent member of the Ukrainian parliament and deputy chairman of the anti-corruption committee. “The merging of politics and business is our main problem.”

Evidence of the close intertwining of business and politics, as well as the huge profits they can bring, were three luxury villas on the southern coast of Spain. They belong to President Poroshenko, Mr. Gladkovsky and Igor Kononenko, another business partner of the President, who heads Mr. Poroshenko’s faction in parliament.

Igor Kanonenko. Photo: wikipedia.org

Before taking public office, they were all rich businessmen, but their unwillingness to disclose the size of their fortunes caused serious suspicions. None of them indicated property in Spain in the annual declaration, which since 2016 has been mandatory for all high-ranking officials - it has become part of attempts to increase the degree of transparency and accountability of Ukrainian officials.

Conflicts of interest are so widespread “that it is no longer shocking,” as Aivaras Abromavičius said (Aivaras abromavicius), a former investment banker from Lithuania, who became one of the leaders of the initiative to eradicate corruption in the government, being at that time the Minister of Economy and Trade of Ukraine. “They are everywhere. This is sad, discouraging and frustrating. ”

This disappointment has already cost Ukraine a lot. The International Monetary Fund and the European Union, annoyed by the constant delays in creating the long-promised independent anti-corruption court and other delays, denied Ukraine the next tranche of financial assistance, which already exceeded 5 billions of dollars.

“Ukraine has been living in pervasive corruption for many decades,” said Artyom Sytnik, director of the National Anti-Corruption Bureau (NABU), an independent agency established in 2015 during the initial burst of enthusiasm after the overthrow of Mr. Yanukovych. - These schemes have been revised and updated, and now they are working again. Some people just don't want to get rid of them. ”

His bureau was able to collect materials on 107 cases filed against previously untouchable officials, but only one such case ended with a real court sentence. The rest of the cases are stuck in a slow judicial system due to corruption and political interference.

Attempts by NABU to deal with defenses related to the defense sector — attempts that led to the arrest of the Deputy Minister of Defense and the head of the procurement department last year — turned out to be a whole series of measures designed to neutralize this anti-corruption bureau.

“This is a very sensitive area,” explained Mr. Sytnik.

In the past few months, NABU has been under constant pressure: the parliament has been working on a bill that could deprive the NABU of all its powers, and representatives of internal intelligence conducted searches in the homes of employees of this bureau.

Mr. Poroshenko, who is expected to take part in the presidential elections next year, is positioning himself as a leader who rebuilt the decrepit army and spoke out against Russian President Vladimir Putin. But to the horror of the Ukrainian leader, this conflict with pro-Russian separatists is gradually turning into public consciousness from a heroic struggle against the enemy into another gate for speculation and corruption.

Фото: Depositphotos

This transformation was facilitated by the actions of the former Georgian President Mikheil Saakashvili - until last week, when officers of the Ukrainian security services seized him in a Kiev restaurant and sat him against his will on a plane bound for Poland. Saakashvili created a new political party in Kiev that focused on criticism of corruption in Ukraine. His supporters in Kiev joined the disgruntled war veterans in the east of the country, who set up a campground outside the parliament building. Their tents and barricades are decorated with posters accusing Mr. Poroshenko and his business partners of stealing while the soldiers died for their homeland.

Mikheil Saakashvili. Photo: Depositphotos

“Now no one talks about Putin anymore, now Poroshenko has become the P word,” Mr. Saakashvili said in an interview in Kyiv shortly before his expulsion from Ukraine. “It’s unfair because the main culprit is Putin, but people see that there is a war and that Poroshenko and his cronies are making money from it.”

Mr. Abromavicius, who resigned, having lost faith in the effectiveness of attempts to eradicate corruption in Ukraine, said that, in his opinion, Mr. Poroshenko is unlikely to personally benefit from the military conflict in the east of the country. But, according to him, the president is also responsible for this, because he did not fulfill his promises to sell his business assets and create a truly independent anti-corruption court.

Mr. Gladkovsky spoke up in defense of secrecy and the lack of open tenders for the purchase of military equipment: according to him, this is a necessary measure aimed at preventing Russia from intervening in the procurement process through front companies, which she allegedly did several times when there were attempts competitive bidding.

“No one earns money in war,” he said.

According to Mr. Gladskovskiy, he withdrew from the decision-making process in his automobile company, Bogdan Motors, and he learned about ambulances only when he arrived at the front line, where he saw his company’s cars and experienced a sense of pride .

“Corruption,” he said in an interview, “is indeed a very serious problem, but it is not related to the system I am leading.”

The largest element of its system was Ukroboronprom, a huge state conglomerate that combines 130 companies, which employ approximately 80 thousands of people. Dmitry Maximov, a former employee of the control department of Ukroboronprom, said that the muddy procurement transactions were the “essence” of this conglomerate's operations.

Фото: Depositphotos

He told how a small helical piece of metal purchased by Ukroboronprom for a repair plant in Lviv rose sharply in price from 50 dollars at the beginning of 2014 to almost 4 thousand dollars a year later, when Ukroboronprom changed for some unknown reason the supplier.

According to Mr. Maximov, he raised the question of inexplicably high prices in conversations with his superiors, but he was advised not to pay attention to it, and later he was dismissed altogether - now he is challenging his dismissal in court.

Denis Gurak, the young deputy director of this conglomerate, said that he did not know anything about Mr. Maximov’s complaints, but acknowledged that corruption really flourishes in the defense sector. He added that after several years of systematic looting under Mr. Yanukovych - who, in his words, he created Ukroboronprom in 2010 to centralize the looting process - “it’s a miracle that we can do anything at all.”

“This is a systemic problem for the whole of our country, and not just for one sector,” he said. - The system does not work, so people steal. That is why the Soviet Union collapsed. ”

According to him, Ukroboronprom sent 200 to the prosecutor's office about corruption in its ranks, but only two of them eventually turned into convictions.

Last week, this conglomerate announced the resignation of its CEO Roman Romanov.

Daria Kalenyuk, director of the Anti-Corruption Center, a non-governmental group in Kiev, said that transparency and accountability are issues of national security that need to be addressed if Ukraine wants not only to create a capable European-style democracy, but also to win in the east.

They will also clarify why the ambulances sold by Mr. Gladkovsky’s company continue to break down and why they were bought at all.

According to a report released last year by the Independent Anti-Corruption Committee on Defense, each of these vehicles, whose running gears were manufactured in China, cost the 32 thousands of dollars to the Ministry of Defense of Ukraine — an ambulance bought in China would be much cheaper - and their carrying capacity is only 360 kilograms - this is too little for the car, in which the driver, armed guard and medical personnel should fit.

Valentina Varava, a volunteer who helps the military in the east of Ukraine, said that these ambulances are designed for city roads, but “there are no roads in the combat zone”.

According to her, 19 from 50 machines delivered to the east has already failed. She added that the Ministry of Defense had recently decided to buy more 100 ambulances from Mr. Gladkovsky’s company.

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