Inside Ukraine October 16, 2014 №33 Content The Government Policy . 1 The President summed up the peace plan implementation . 1 A breakthrough in anti-corruption legislation . 3 Economic Situation . 5 Donbass losses from Russian aggression . 5 Separatists seek “energy autonomy” . 7 Political competition . 9 Diversification “Privat-style” . 9 Increasing role of Serhiy Lyovochkin . 10 Inside Ukraine 33 The Government Policy Experts’ criticism regarding presidential adminis- This issue can be resolved by identifying and punish- tration’s mistakes in information policy on Donbas ing those responsible for provocations and unrest. issues has brought positive results. Communication The Verkhovna Rada has adopted a package of between the President and citizens became more anti-corruption laws proposed by Petro Porosh- regular. Recently, he has summed up the first month enko and Arseniy Yatsenyuk. The package includes of his peace plan implementation. Stopping the en- laws on prosecutor’s office, determining final ben- emy along the frontline and decrease in the number eficiaries of legal entities, anti-corruption strategy, of casualties have become the key achievements of the National Anti-corruption Bureau and National the plan. Peaceful settlement of the conflict remains Commission for the Prevention of Corruption. On the only possible option for the President. the same day, the President established the National Nevertheless, the President took several regional Council for Anti-Corruption Policy with similar trips in order to inspect the level of defense capabil- functions as those of the National Commission. ity and made several appointments in security block. This testifies that the President and the Prime Min- Russia’s attempts to destabilize the situation in Kyiv ister will be trying to personally control the issue of using protests of radical groups and law enforcement combatting corruption. This also confirms the im- officers can become a new challenge for the President. portance of this issue for Ukraine. The President summed up the peace plan implementation On October 12, 2014, in his video address to positive. Such a communication will enable Petro citizens, Petro Poroshenko summarized the pre- Poroshenko to mobilize support groups for his ini- liminary results of the peace plan implementation tiatives, take the wind out of his critics’ sails, coun- and outlined the next steps of the Ukrainian au- teract Russia’s attempts to destabilize situation in thorities in Donbas. The The President Kyiv, radical groups’ activities and anti-govern- fact that communication improves ment protests. between the President communication As a result of Minsk agreements, according to and the society becomes with society the President, the enemy was stopped all along the more regular is extremely front, ceasefire at a considerable length of the con- Inside Ukraine 33 1 The Government Policy tact line was achieved and the number of casual- of State Border Guard Service Mykola Lytvyn has ties reduced. 1500 Ukrainian military were released been dismissed. His dismissal was required by from captivity over one month of the nominal truce, civic activists since the The President made a partial rotation of military personnel was carried beginning of summer, a number out, military units were reinforced by equipment when Luhansk border of appointments and several lines of defensive structures along the guard detachment had in security block contact line were established in Donbas. As a posi- been captured and un- tive result, the President also mentioned restoration impeded armament’s supply to militants through of infrastructure and organization of social security Ukraine-Russia border had been organized in this in liberated cities. region. Another dismissal concerns the Ministry Petro Poroshenko appointed veterans of law en- of Defense, where Valeriy Heletey was replaced forcement structures Hennadiy Moskal and Olek- by Stepan Poltorak, head of the National Guard. It sandr Kikhtenko as heads of Luhansk and Donetsk should be noted that the National Guard is part of regional administrations In Donbass the Ministry of Internal Affairs, and not the Min- respectively. Taking into governors will istry of Defense. One of the reasons for such ap- consideration threats focus on the issues pointment may be problems with material provi- of terrorist attacks and of citizens’ security sion of the Ukrainian army, while these issues were sabotage activities in the successfully solved in the National Guard. liberated cities and continuation of armed conflict On the eve of the appointment of a new Minister in some front areas, providing law enforcement of- of Defense, some units of the National Guard, which ficers with posts in local executive authorities is a used to be a part of internal forces and participate in quite clear decision. This decision resembles the the Maidan confrontations, held a protest in front of establishment of military commandant’s offices in the President’s Administration, demanding demo- front-line zones. For the effective administration bilization. The soldiers returned to their permanent of the territory under control of Ukrainian au- stationing, but on the next day, there were clashes thorities, it is reasonable to set new borders of ad- between radical groups and police officers near the ministrative units in Donetsk region as it has been Verkhovna Rada. These two episodes testify Russia’s recently done in Luhansk region. attempt to undermine the Russia tries As for the next steps in peace settlement, Petro situation in the country to destabilize Poroshenko stressed the need for a complete cease- by inciting anti-govern- situation in Kyiv fire, establishing 30-km buffer zone and regaining ment sentiment. control over Ukraine-Russia border by the Ukrai- In order to counteract such a scenario, Petro nian side, including using drones, and increasing Poroshenko needs effective security structures the number of OSCE monitors to 1,500 people. As without Kremlin’s agents of influence. Any offenc- part of Poroshenko’s peace plan, local election in es that can lead to destabilization of the situation Donbas should be held on December 7, 2014 in in the country must inevitably lead to punish- accordance with the Ukrainian legislation and par- ment in accordance with applicable law. The fact ticipation of OSCE observers. At the same time, the that many law enforcement officers, prosecutors President stated that Ukraine would not recognize and judges have not been punished for fulfilling the results of the so-called election in separatists’ criminal orders during Euromaidan contributed republics scheduled for November 2, 2014. to problem freezing. As a result, there is a stra- The President also made a number of appoint- tum of law enforcement officers that can be used ments in security block. Ihor Smeshko is appointed by the Kremlin for its own purposes in the fight as a head of the Intelligence Committee. The Head against the Ukrainian government. 2 Inside Ukraine 33 The Government Policy A breakthrough in anti-corruption legislation Fighting corruption is a system reform that will of competitive selection. The Commission mem- affect all aspects of society: public administration, bers are obliged to undertake a special assess- law enforcement system, Anti-corruption ment and not to belong to government bodies of economy, and even de- reform will political parties for at least one year prior to the fense. Its high priority influence all appointment. The Chairman of the Commission has been repeatedly em- spheres of life is elected from among its members for two years. phasized by the President The objectives of new body are to analyze fighting and Prime Minister, as well as by all the principal corruption process in Ukraine, develop anti-cor- foreign partners of Ukraine. The adoption of anti- ruption strategy, conduct research on corruption, corruption laws on October 14, 2014, provided a le- introduce the unified register of officials’ declara- gal framework for combating corruption. Now ev- tions and people who have committed corruption erything depends on how effectively these changes offences, and cooperate with whistle-blowers on will be implemented in life and who will head the corruption cases. newly established institutions responsible for deal- On the same day the President signed a De- ing with corruption. cree on the establishment of the National Council The Verkhovna Rada adopted laws on anti- on the Anti-Corruption Functions corruption strategy for 2014-2017, on the system Policy as advisory body of anticorruption of specially authorized subjects in the sphere of to the President. Sig- commission corruption counteraction, on the National Com- nificantly, the functions and council overlap mission for the Prevention of Corruption, and on of the National Council disclosure of final beneficiaries of the legal entities. and the National Commission duplicate in a lot of The success of the fight against corruption will cases. The bodies differ in formation mechanism also be influenced by adopted law on the prosecu- and accountability: the National Commission re- tor’s office, which was passed in the first reading ports to the Cabinet and selection of the mem- in October 2013 and then was defined as one of bers is based on competition, while the National the prerequisites essential for signing the Asso- Council members are appointed by the President ciation Agreement with the EU. Even after Victor and accountable to him. The National Commis-