PRIORITIES and EXPECTATIONS from UKRAINE and GERMANY: How to Make Bilateral Relations More Sustainable
Alyona Getmanchuk, Sergiy Solodkyy, Susan Stewart, Ljudmyla Melnyk
PRIORITIES AND EXPECTATIONS FROM UKRAINE AND GERMANY: How to make bilateral relations more sustainable
New Europe Center (Ukraine) and Institut für Europäische Politik (Germany)
2020 This publication has been developed with the support of the Open Society Initiative for Europe in the framework of the “Europeanisation beyond Process” initiative jointly implemented by the New Europe Center and the Institut für Europäische Politik. The opinions expressed are those of the authors and do not necessarily reflect the views of the New Europe Center, the Institut für Europäische Politik, or the Open Society Foundations.
About New Europe Center (NEC) About Institut für Europäische Politik (IEP)
New Europe Center (NEC) was founded in 2017 as an Since its founding in 1959, the Institut für Europäische independent think tank. Despite the new brand, it is Politik (IEP) has been a non-profit organisation based on the experience of a team that has worked dedicated to the study of European integration. It is one together since 2009 (formerly within the Institute of of the leading foreign and European policy research World Policy). The vision of the New Europe Center is centres in the Federal Republic of Germany and serves as close as possible to the vision of the future of the as a forum for exchange between academia, politics, Ukrainian state shared by the majority of its citizens: administration and political education. The IEP’s mission Ukraine should be integrated into the European Union is to apply scholarly research to issues of European and the NATO. We see integration as not specifically the politics and integration, propose ways forward and formalized membership, but rather adopting the best promote the practical implementation of its research standards and practices, so that Ukraine could earn a findings. The IEP is a founding member of the Trans- rightful place within the Euro-Atlantic value space. European Policy Studies Association (TEPSA) and has been a member of the German European Movement since 1962. CONTENTS
1. INTRODUCTION ...... 4 2. UKRAINIAN PRIORITIES AND PERCEPTIONS REGARDING COOPERATION WITH GERMANY ...... 6 2.1. Expectations from Ukraine………………………………………… 9 2.2. Donbas: 95% of the dialogue ……………………………………… 11 2.3. “German” and “German-centric” reforms in Ukraine ……… 14 3. GERMAN PRIORITIES AND PERCEPTIONS REGARDING COOPERATION WITH UKRAINE ...... 18 3.1. Communication and coordination as ongoing challenges……………………………………………………………………… 19 3.2. Decentralization as a “flagship” reform………………………… 21 3.3. Economy: The “search for investors” approach is not working well…………………………………………………………… 22 3.4. Cooperation in the energy field: Very positive……………… 24 3.5. NATO: Not a priority for cooperation…………………………… 25 3.6. Donbas: Major hopes associated with Zelenskyy…………… 26
4. CONCLUSIONS ...... 30 4 PRIORITIES AND EXPECTATIONS FROM UKRAINE AND GERMANY: How to make bilateral relations more sustainable
1. INTRODUCTION
Cooperation between Germany and important. As data from the German Ukraine has become more intensive statistics agency Destatis shows, in since 20141, as evidenced by the 2019 exports from Germany to Ukraine establishment of new institutions reached EUR 4.9bn, up from EUR 4.4bn fostering relations with Ukraine, in 2017. Imports from Ukraine saw including the Ukraine Task Force at similar growth with an increase from the German Federal Foreign Office EUR 2.2bn in 2017 to EUR 2.9bn in and the German-Ukrainian Chamber 2019.3 of Industry and Commerce (AHK Ukraine). Germany is the third largest The explicit promotion of Ukrainian donor to Ukraine after the European civil society, particularly evident since Union as a whole and the United 2014, also attests to an intensification States. In 2015 it adopted the Ukraine of cooperative efforts. Thus, in 2014, Action Plan2, which provided for the a new program entitled «Enhancing allocation of about EUR 1.4 billion, Cooperation with Civil Society in the and defined priorities for cooperation, Eastern Partnership Countries and including decentralization, the Russia» was launched to support economy, energy, the fight against civil society projects. Within this corruption, institution building and program, Ukraine was given priority civil society exchanges. in the allocation of funds for the period 2014-2017 and was explicitly Economic cooperation between the mentioned as a priority country in the two countries has become increasingly call for proposals.4
1 This policy paper has been jointly written by four authors: Alyona Getmanchuk (NEC) and Sergiy Solodkyy (NEC), who conducted the research and interviews in Ukraine, and Dr. Susan Stewart (SWP) and Ljudmyla Melnyk (IEP), who conducted the analysis on the German side. The authors would like to thank Belinda Nüssel, Research Assistant at the German Institute for International and Security Affairs (SWP), for her excellent research assistance and the Berlin Policy Hub for the editorial support. 2 DBK (2015). Aktionsplan Ukraine. Retrieved Mai 7, 2020, from https://kiew.diplo.de/ua-de/ themen/politik/aktionsplan2015/1238568 3 Destatis. (2019). Außenhandel. Retrieved May 7, 2020, from https://www.destatis.de/DE/Themen/ Wirtschaft/Aussenhandel/Publikationen/Downloads-Aussenhandel/zusammenfassende- uebersichten-jahr-vorlaeufig-pdf-2070100.pdf?__blob=publicationFile 4 Worschech, S. (2020). Deutsch-ukrainische Kulturbeziehungen: Veränderungen nach dem Euromaidan. Retrieved May 7, 2020, from https://ifa-publikationen.de/out/wysiwyg/ uploads/70edition/deutsch-ukrainische-kulturbez_worschech.pdf 1. Introduction 5
Furthermore, Germany plays a key interviews with German and Ukrainian role in EU solidarity when it comes political stakeholders during February to its sanctions policy. This strategic and March 2020. Events which occurred approach was shown not only through after the interviews could for the most the initiation of strict measures but part not be taken into account in the also through the strengthening of those analysis. Based on the interviews, the measures in response to Moscow’s cooperation priorities, challenges numerous violations of international and expectations on the part of both law. Of note is also Germany’s role Ukraine and Germany were analysed. as a key actor in the talks within the Since the interviews allowed for an Normandy Format, which aims to end inductive approach, it was possible the Russian-Ukrainian war and resolve to identify aspects of the relationship other aspects of the conflict regarding that were assessed differently by the the Donbas. two sides. A comparative analysis of the responses in combination with this At the same time, the relationship approach made it possible to reveal has not been without tensions. In insights and perspectives specific to particular the Nord Stream 2 gas each country. In particular, the approach pipeline has been a bone of contention permitted the authors to pinpoint between the two countries since its the most important similarities and initiation. More recently, the decision differences in perceptions regarding by the Parliamentary Assembly of cooperation and to draw conclusions the Council of Europe (PACE), supported for future bilateral relations. by Germany, to readmit the Russian Federation to full membership privileges also created controversy in the German-Ukrainian relationship.
What is the state of cooperation between Germany and Ukraine following the first year of Volodymyr Zelenskyy’s presidency? What has been the impact on bilateral relations of the shifts in the Ukrainian political landscape, which resulted in not only a new president but also a radically different parliament and two new governments? What are the current expectations and challenges for these relations and to what extent is the groundwork for future sustainable cooperation between Germany and Ukraine being created?
In order to answer all these questions the authors of this analysis conducted 6 PRIORITIES AND EXPECTATIONS FROM UKRAINE AND GERMANY: How to make bilateral relations more sustainable
2. UKRAINIAN PRIORITIES AND PERCEPTIONS REGARDING COOPERATION WITH GERMANY 5
Priorities in Ukraine-Germany relations: What has changed under Zelenskyy’s presidency?5
During Petro Poroshenko’s presidency, President Vladimir Putin, by using a Ukraine’s top priority when it came to direct channel of communication relations with Germany was Berlin’s between German and Russian leaders. support for the containment of The third level of influence was the Russian aggression against Ukraine. impact on the member states of the Ukraine was interested in Germany as European Union, primarily, in the a country that, due to Chancellor context of maintaining the sanctions Angela Merkel’s personal leadership against Russia. During Barack Obama’s and commitment, could have an presidency, there was a fourth level of impact at three levels of deterrence.6 Germany’s influence that was also The first was the influence within partially extended to the US. However, Germany, primarily within the with the arrival of Donald Trump in government coalition and among the the White House, this level of business community, whose influence disappeared from Kyiv’s radar (the Ukrainian president was even advised not to mention Merkel’s name in the negotiations with Trump With the election of Volodymyr Zelenskyy as to avoid annoying him).7 president, Ukraine’s foreign policy focus has shifted from the search for allies to the search for Thus, the key priority regarding investors. Germany under Poroshenko’s presidency was to turn Germany into an ally of Ukraine. With the election representatives have questioned the of Volodymyr Zelenskyy as president, feasibility of sanctions against Russia Ukraine’s foreign policy focus has from the beginning. The second was shifted from the search for allies to the influence on Russia, namely the search for investors. Investments
5 The New Europe Center expresses its sincere gratitude to the representatives of the Ukrainian authorities who agreed to be interviewed during the preparation of this document, namely Dmytro Kuleba, Ihor Zhovkva, Oleksiy Reznikov, Taras Kachka, Vasyl Khymynets, Rostyslav Ohryzko, and Ruslan Kalinin. 6 Getmanchuk, A., Solodkyy, S., How to turn situational partnership into priority one. Foreign policy audit: Ukraine-Germany. New Europe Center, 2016. http://neweurope.org.ua/wp-content/ uploads/2017/10/Aud_Ukr_Germ_01_40_eng-3.pdf 7 An interview conducted during the preparation of this research, February 13, 2020 (on an anonymous basis). 2. Ukrainian Priorities and Perceptions regarding cooperation with Germany 7
and investors have been highlighted by several of our interlocutors in the Now officials involved in preparing visits to executive branch of the Ukrainian Germany claim that there should be three to leadership as the new priority in four practical results of each foreign visit by relations with Germany. the president or other high-ranking Ukrainian officials. The new focus has already emerged quite clearly in the preparations for the visits of Ukrainian officials to at a time when Ukraine was in an Germany. While the very fact of such incredibly difficult situation, due to visits, so-called diplomacy of symbols, the illegal annexation of Crimea and was important for Poroshenko’s the beginning of the war in Donbas. In presidency, now officials involved in the intervening six years, the situation preparing such visits claim that there has changed, and therefore, Kyiv should be three to four practical would like to review the effectiveness results of each foreign visit by the of certain programs and initiatives president or other high-ranking from the German side. For example, Ukrainian officials. “There have been the effectiveness of the traditional fewer requests for the participation of visits of the state secretaries of the president in events in Germany German ministries to Ukraine is being that have no practical added value. questioned.9 Every visit, every participation is viewed through a prism of what The highest-level dialogue between would this give us in a practical the two countries has significantly sense, what deals, what investments. improved during the past six years. There are very specific questions Ukrainian officials compare and concerning our interests”, noted our argue that the dynamics of dialogue source in government circles.8 No between the Ukrainian president wonder one of the major events and the German chancellor has not planned for this year is the Ukrainian- lessened and remains quite high. German Economic Forum that the The difference now is that Zelenskyy, Ukrainian side proposed to host in unlike Poroshenko, does not add an June, first in Lviv (which did not find appropriate publicity support to every sufficient support among the German phone call with Merkel. Perhaps, this is partners), and later in Kyiv. why there is a widespread impression beyond the Office of the President, in The need to audit the German particular in the government and in the assistance poses a certain challenge parliament, that Merkel and Zelenskyy today. This is primarily due to the fact communicate very little. that many initiatives were launched
8 An interview conducted during the preparation of this research, February 13, 2020 (on an anonymous basis). 9 An interview conducted during the preparation of this research, February 19, 2020 (on an anonymous basis). 8 PRIORITIES AND EXPECTATIONS FROM UKRAINE AND GERMANY: How to make bilateral relations more sustainable
Certain representatives of the Ukrainian (along with the USA and Poland). government also point out that in the “Nothing has changed at the working case of Poroshenko, there was also the level”, is perhaps the most popular factor of personal gratitude to Merkel: diagnosis of the current state of since the moment of his election as Ukrainian-German relations by among president (at the time, the German the interviewed officials.10 chancellor facilitated the presidential election to be internationally At the same time, it is easy to discern recognized) and later, throughout the a noticeable difference in the rhetoric term of his presidency, the German towards Germany by the political leader was on the side of Ukraine in the “neophytes” who came to power with most critical moments. Zelenskyy, and the position of those officials who worked under previous presidents and are holders of the In his actions, Zelenskyy focuses primarily on the institutional memory when it comes to reaction of Ukrainian society, not the position of Ukrainian-German relations. The latter the international community. place greater emphasis on the security component and the importance of Germany in the context of sanctions. At the same time, the rhetoric of the There is also reason to believe that former shows a more skeptical attitude for Poroshenko, Angela Merkel’s towards the role of international position on certain issues pertaining partners, including Germany, in to the situation within or around Ukrainian affairs. Ukraine was more important than for Zelenskyy. In his actions, Zelenskyy Some of our interlocutors characterize focuses primarily on the reaction of communication between states as Ukrainian society, not the position “insular”, since there is a lack of of the international community. An a holistic, systematic approach. example is the dismissal of Prosecutor One of the explanations for this General Ruslan Ryaboshapka despite phenomenon, according to our the fact that the president knew that interlocutors in Kyiv, is that in the G7 position was that he should be Germany, different institutions kept in this post. maintain a different profile when it comes to Ukraine. There is a separate There are, however, assurances that one in the Chancellor’s Office, and Germany’s place on the scale of different ones in the Ministry for Ukraine’s foreign policy priorities Economic Affairs and Energy, Federal continues to be high. Germany is ranked Foreign Office, and Ministry of Labour within Ukraine’s top-3 key partners and Social Affairs.
10 An interview conducted during the preparation of this research, February 10, 2020 (on an anonymous basis). 2. Ukrainian Priorities and Perceptions regarding cooperation with Germany 9
Another explanation is that, unlike the the collapse of the Western sanctions Ukrainians, the German partners are regime, since the Russian delegation “very keen on details”.11 “It is vital to was allowed to return in spite of work systematically; the accumulation the non-compliance of the Russian of details leads to knowledge, and Federation with any of the Council knowledge leads to breakthroughs, of Europe resolutions. The second ideas, the emergence of new concepts. and key one is Nord Stream 2. The Therefore, we do not have to go to Ukrainian view, in particular, is that Berlin with big ambitious goals, like ‘we it is impossible to deter Russian need the EU membership’, and then do aggression by indirectly financing nothing. First, we need to accumulate a it: some of the money earned from mass of positive accomplishments that the sale of energy resources is then will organically transit into a new stage spent on financing wars in Ukraine, of cooperation”, one official notes.12 Syria and other regions of the world. Also, there are assurances from the To sum up, the strongest point in Ukrainian capital that the German Ukrainian-German relations, according partners should not be offended by to the view from the Ukrainian Ukraine’s support of the US sanctions capital, is Berlin’s firm position, which against Nord Stream 2, because in maintains the EU’s unity on the issues this case, Ukraine is defending its related to deterring Russian aggression, national interests, not the US ones. namely the sanctions imposed against the Russian Federation, the “passportization”, the elections in Crimea, and the maintenance of 2.1. EXPECTATIONS FROM sanctions against former President UKRAINE Viktor Yanukovych’s officials, all the areas where the Germans act “as a Expectations about Germany in Ukraine locomotive of the EU’s reaction.”13 vary depending on the profile of the particular institution and on the There are two major downsides to relevant partner in Germany. The main the relationship, that were named idea behind all the expectations is to by our interlocutors. The first is have more Germany in Ukraine. the restoration of the Russian delegation’s powers in the Council of Europe’s Parliamentary Assembly (PACE), which was supported by The main idea behind all the expectations is to Germany. From the Ukrainian point have more Germany in Ukraine. of view, this is the first step towards
11 An interview conducted during the preparation of this research, February 10, 2020 (on an anonymous basis). 12 An interview conducted during the preparation of this research, February 10, 2020 (on an anonymous basis). 13 An interview conducted during the preparation of this research, February 10, 2020 (on an anonymous basis). 10 PRIORITIES AND EXPECTATIONS FROM UKRAINE AND GERMANY: How to make bilateral relations more sustainable
What unites all Ukrainian the highest level; that would stakeholders is the concern about emphasize the strategic nature of future political changes in Germany. relations”,15 our interlocutors in Ukraine is perhaps one of the Ukraine’s diplomatic circles argued countries in the world where Angela regarding the need for this format. Merkel’s eventual stepping down from power is seen as a highly negative Since 2013, there has also been no scenario. Recently, for the first time in political consultation at the level five years, Angela Merkel overtook of the MFAs of the two countries. In Belarusian President Alexander Ukraine, it is believed that they should Lukashenko when it came to ranking be resumed so that dialogue between the popularity of foreign leaders the two countries is not reduced to the among Ukrainians.14 There is a Minsk Format, but provides another growing concern among the opportunity to discuss the broader authorities over how the Ukraine- agenda, including the EU, the UN, Germany dialogue will develop disarmament and other tracks. without Angela Merkel. That is why, in order to maintain a high level of The representatives of the Ukrainian political dialogue between the two government particularly emphasize countries, there is a unanimous the expectations related to Germany’s expectation that the high-level six-month presidency of the EU. This is intergovernmental consultations, explained by the fact that the priority which took place during the time of for the European Union when it comes President Leonid Kuchma and to Ukraine this year is the signing Chancellor Gerhard Schroeder, will be of the ACAA agreement, often called restored. On the other hand, while “the industrial visa-free regime” with these consultations were held once the European Union and Ukraine. “We every two years during the Kuchma- expect a breakthrough in terms of Schroeder era, today, Ukraine would the industrial visa-free regime from propose that they be restored on an Germany. And we expect to sign the annual basis. “It is necessary to keep a agreement at the Association Council constant communication platform at during Germany’s presidency”, noted Dmytro Kuleba, now Foreign Minister of Ukraine and at the time of the interview While the ACAA is a priority for 2020 in the Deputy Prime Minister for European and context of the EU, when it comes to NATO, it is Euro-Atlantic Integration.16 Kyiv’s accession to the Enhanced Opportunities Partnership (EOP). In this context, Germany’s In Kyiv, other representatives of the position is also one of the key ones. Ukrainian government also name the signing of the ACAA during Germany’s
14 Opinion poll conducted by the Rating Sociological Group, December 2019. 15 An interview conducted during the preparation of this research, February 19, 2020 (on an anonymous basis). 16 An interview with Dmytro Kuleba (who agreed to be quoted), February 5, 2020. 2. Ukrainian Priorities and Perceptions regarding cooperation with Germany 11
EU presidency as a huge success. At reassessment of German assistance the same time, there are concerns in to Ukraine, and also that Germany Kyiv that in Germany, Ukraine might will continue to be involved in the be perceived as a competitor rather process of decentralization in Ukraine, than a partner in this matter. This is in particular, through expanding the extremely important for Ukraine, as opportunities for visits of Ukrainian it would allow the implementation of local officials to German federal the industrial integration of the two states. There are also expectations countries: when German companies regarding an increase in the number will be actively represented in of projects that would be based on Ukraine, and Ukrainian ones in the German experience of vocational Germany. This topic resonates with (or so-called dual) education. President Zelenskyy’s priority to see a more active presence of foreign investors. 2.2. DONBAS: There is also an expectation towards 95% OF THE DIALOGUE Germany regarding the main priority in Ukraine’s Euro-Atlantic integration Despite the business focus of area for this year. While the ACAA is Zelenskyy’s foreign policy, 95% of the a priority for 2020 in the context of dialogue with Germany at the highest the EU, when it comes to NATO, it level is focused on issues related to is Kyiv’s accession to the Enhanced Donbas.17 However, as they note in Kyiv, Opportunities Partnership (EOP). In Germany’s support is not as solid as this context, Germany’s position is it used to be. In government offices, also one of the key ones. this is explained, first of all, by the fact that Germany has been plunged into The authorities in Ukraine specifically its own internal political crisis due to emphasize the expectations regarding the rather complicated process of the Germany in the context of resolving transition of power. Accordingly, foreign the conflict in Donbas. Those policy issues, in particular the ones expectations mainly relate to the related to Ukraine, have been sidelined. support from the German side for The situation surrounding the spread several of Ukraine’s key positions in of COVID-19 has only exacerbated this the negotiations process, in particular shift in focus. the modernization of the Minsk Agreements. However, there are obviously other factors on the German side. According The Ukrainian officials also expect to our interlocutors who spoke the EU’s Energy Efficiency Fund to on condition of anonymity, in the continue to operate in the country Ukrainian capital the lower level of as a result of a proper analysis and Berlin’s involvement is also linked
17 An interview conducted during the preparation of this research, February 13, 2020 (on an anonymous basis). 12 PRIORITIES AND EXPECTATIONS FROM UKRAINE AND GERMANY: How to make bilateral relations more sustainable
to the fact that the Ukrainian side negotiating team. It now consists of initially questioned the effectiveness several officials representing both the of the Normandy Format and relied on government and the parliament. bilateral agreements with the Russian side (dialogue on the Kozak-Yermak In general, the expectations expressed line), where the role of Germany is not in Kyiv in the context of the Donbas always clearly articulated. Moreover, could be summarized with the certain Ukrainian stakeholders following three points: share the opinion that Germany and Merkel have already done all they could have done over the last six 1. Defending the position regarding years (including in the dialogue with the Minsk Format’s flexibility Putin). Accordingly, there is a need for (especially given that Chancellor different approaches. Merkel was the first leader in the Normandy Format to publicly On the other hand, such skeptical announce the appropriateness sentiments did not prevent the of the “flexible Minsk”). The key Ukrainian side from initiating a point for Ukraine is border control process that would, in fact, enhance with a foreign component before the presence of German (and French) elections. partners in the Minsk negotiations. In particular, our interlocutors 2. Access for humanitarian emphasized the fact that the idea organizations (Red Cross) to the on the establishment of the so- occupied territories, an agreement called Advisory Council within the that was reached at the Normandy framework of the political subgroup Format summit in Paris but never of the Minsk Process is also about implemented. the “introduction” of German and French negotiators into the Minsk 3. Putting pressure on Putin Format. In other words, it is not in terms of facilitating the about marginalization, but rather the exchange of prisoners, the extension and strengthening of the number one priority for Zelenskyy. Minsk Format. In addition, by inviting German and French partners to This is primarily about the political negotiate in Minsk, Ukraine intended dialogue. With regard to the to lay a kind of bridge between the humanitarian dimension of the war Normandy and Minsk formats. Since in Donbas, in the relevant Ukrainian the idea of the Advisory Council was agencies, they pay tribute to the role widely criticized within the country, played by Germany in the context the authorities decided to transform of the settlement of the housing it. Therefore, in the beginning of problem for displaced persons. “For us, May the president signed a decree Germany is today, perhaps, the leading strengthening the Ukrainian international partner in addressing 2. Ukrainian Priorities and Perceptions regarding cooperation with Germany 13 housing issues for displaced persons”, settlement of displaced persons in one of our interlocutors said.18 Ukraine, where 7,000 people reside.
The reasons for this assessment are In this context, today’s expectations obvious. The project implemented towards Germany could be by the German development bank summarized as: KfW with the participation of the Ukrainian Social Investment Fund zz increased grants for the has been a success. In particular, the reconstruction of housing facilities; bank has already provided two grants to reconstruct the facilities (primarily zz retraining courses for displaced dormitories) and resettle a total of persons with mandatory monitoring 1,400 displaced persons in five regions of results; of Ukraine (Donetsk, Luhansk, Kharkiv, Dnipropetrovsk, and Zaporizhzhia). zz housing loans; The Ukrainian agencies are pleased that the German partners themselves zz funding of a comprehensive State control the selection of applications Housing Program; and the use of funds. There is also an expectation that the funding for the zz assistance in Ukraine’s accession to third grant will be increased. the Council of Europe Development Bank on minimum payment terms; Another important aspect is the project that provides non-repayment assistance zz contribution of German experience for housing loans to displaced persons towards the resolution of the issue (via Ukrgasbank). The projected volume of mines in Donetsk and Luhansk is 25.5 million euros that would regions. “cover” 6-7% of the loans. At the time this research was being prepared, the final version of the agreement, which actually should have been signed two and a half years ago, was being prepared for signing. These are just several illustrative examples of how Germany is involved in addressing the most sensitive issues for displaced persons from Donbas. According to Ukrainian government estimates, 400,000 displaced persons are currently in need of housing. At least 50,000 are interested in obtaining loans. In total, today there are 158 places of compact
18 An interview conducted during the preparation of this research, March 3, 2020 (on an anonymous basis). 14 PRIORITIES AND EXPECTATIONS FROM UKRAINE AND GERMANY: How to make bilateral relations more sustainable
2.3. “GERMAN” Ukraine closer to the eastern German AND “GERMAN-CENTRIC” states that today pose a challenge REFORMS IN UKRAINE for the Ukrainian government due to their regular calls for the lifting of sanctions and their support for Germany has been and continues to Vladimir Putin’s policies. be involved in reforms in Ukraine on two levels. The first one is the level of Decentralization was often referred the involvement of Germany itself as to by the Ukrainian authorities as an EU member state. The second one the most successful reform in which is the level of its involvement via the Germany was actively involved as European Union, where Germany is an EU member state. However, for represented quite strongly and plays an some time Georg Milbradt’s role important role, including when it comes was not fully understood by all to Ukraine. Ukrainian officials and MPs, nor was the status of his recommendations. One of the reforms chosen by Obviously, this was the result of the Germany was the decentralization large number of foreign advisers reform. A similar choice was made who appeared in Ukraine after the following Kyiv’s initiative that each Revolution of Dignity and the illegal of the G7 countries should assume annexation of Crimea, but their added supervisory authority for one of the value is still sometimes questioned. reforms and moreover, propose a Milbradt is just one example of how special representative, who would an advisor could effectively do his directly take responsibility for job once he had the support of the that reform, visiting Ukraine and governments of the two countries, in developing recommendations for this case Germany and Ukraine. the Ukrainian authorities. Germany became the only country to do so, Our informed interlocutors in the choosing the issue of decentralization Ukrainian capital called key reforms and appointing the appropriate in Ukraine “German-centric” (due to German government special the active involvement of officials representative, Georg Milbradt. An of European institutions who were important aspect of this assignment German). The judicial reform was in the context of Ukrainian-German named as the one that failed the relations is that Milbradt, as the most. Another not particularly former premier of an eastern German successful reform, according to the state, Saxony, could exemplify how Ukrainian officials, was the civil former heads of Eastern German service reform. It is important to regions can share their experience of note that Ambassador of Germany to reforms with Ukraine.19 Under certain Ukraine, Anka Feldhusen, has recently conditions, this could also help bring named decentralization reform and
19 Foreign Policy Audit: Ukraine-Germany. New Europe Center http://neweurope.org.ua/wp- content/uploads/2017/10/Aud_Ukr_Germ_01_40_ukr-1-1.pdf 2. Ukrainian Priorities and Perceptions regarding cooperation with Germany 15
judicial reform as the two priorities unanimously recognized as successful for Berlin in the context of reforms in both in Ukraine and in the EU (at Ukraine.20 least as of spring 2020). The combination of efforts and the The Ukrainian authorities generally political will of the European Union, welcomed the level of support that other international partners, the official Berlin provided to the Ukrainian German chancellor, the Ukrainian transformation processes. It is not leadership, and the non-governmental only about hundreds of millions of sector have ensured the sustainability euros, but also about political support, of this reform. Moreover, it is hard to or advisory assistance. For the most call the decentralization process easy, part, our interlocutors have not been the resistance has been and is being able to single out any clear reform or felt at different levels, as the central concrete steps within a specific area authorities do not want to finally say for which Berlin should prioritize its goodbye to significant control future efforts. Sometimes, it might functions regarding the local levels of seem that Kyiv is not always ready to government. However, it is difficult to push the bilateral agenda beyond the stop the process now, and official Kyiv resolution of the conflict in Donbas. is paying close attention to both local However, this assessment may be due politicians and German partners when to the fact that our interlocutors were it comes to further progress in generally responsible for defining the decentralization. strategic framework of the cooperation. The narrower the specialization of the interviewed official, the more specific Ukrainian authorities would like to move to their estimates and expectations were. a different level of cooperation, in order to In any case, the idea of auditing the ensure that Ukraine is regarded not only as available assistance and the possibility a springboard for future changes, but as an of its adjustment seems quite equal partner, cooperation with which can bring reasonable, given the changing realities benefits today. and priorities in Ukraine, and obviously in Germany in the near future. The Ukrainian authorities would like to It is especially important to learn the develop the cooperation in the natural positive lessons: why the reforms gas sector. For example, there was a have been successful in certain areas, proposal for the synchronization of and not in the others. For instance, Central European natural gas markets decentralization-related reforms are with the Ukrainian one.21 “The natural
20 The Institut für Europäische Politik (Berlin) in cooperation with the New Europe Center (Kyiv) organized the first Germany Breakfast Debate in Kyiv, March 12, 2020 in the framework of the project „German Ukrainian Researchers Network“ (GURN) . The GURN is supported by the German Federal Foreign Office. http://neweurope.org.ua/plechem-do-plecha-z-ukrayinoyu- nova-yevropa-provela-u-kyyevi-pershyj-nimetskyj-snidanok/ 21 An interview conducted during the preparation of this research, February 5, 2020 (on an anonymous basis). 16 PRIORITIES AND EXPECTATIONS FROM UKRAINE AND GERMANY: How to make bilateral relations more sustainable
gas market reform is super successful! welcomed engaging another German We have implemented the unbundling. consultant on privatization, Rainer Now the question is, could we become Bomba (former state secretary at a super partner in the natural gas Germany’s Ministry of Transport and sector?” Such ideas are quite common Digital Infrastructure).23 In Kyiv, they among the Ukrainian officials.22 hope that he could contribute to However, at this stage, it is obviously attracting foreign capital. In addition, more about intentions than specific extravagant ideas have been expressed: projects. for example, about Ukraine as a kind of platform for cooperation between The interviews indicated that the Germany and China.24 Our interlocutors Ukrainian authorities would like to also stressed the value of Ukrainian move to a different level of cooperation, citizens as a workforce for the German in order to ensure that Ukraine is economy.25 On the other hand, the regarded not only as a springboard idea of a “new labor deal” between for future changes, but as an equal Germany and Ukraine, which has been partner, cooperation with which can broached in the official circles, would bring benefits today. Most often, in not see German businesses focus on this context, officials talked about attracting Ukrainian workers to their German investors who could make enterprises in Germany. Instead it a profit by opening businesses in would be about creating more jobs and Ukraine. In this context, Kyiv generally opening more German enterprises in Ukraine, especially in Central, Southern, Northern and Eastern parts of Ukraine, The idea of a “new labor deal” between Germany where today there is no such severe and Ukraine, which has been broached in the labor force shortage as in Western official circles, would not see German businesses Ukraine.26 focus on attracting Ukrainian workers to their enterprises in Germany. Instead it would be about Last year, in 2019, the trade turnover creating more jobs and opening more German between the two countries reached enterprises in Ukraine. 9.5 billion dollars. Ukraine would like this indicator to grow steadily, though
22 An interview conducted during the preparation of this research, February 10, 2020 (on an anonymous basis). 23 An interview conducted during the preparation of this research, February 22, 2020 (on an anonymous basis). 24 An interview conducted during the preparation of this research, February 10, 2020 (on an anonymous basis). 25 An interview conducted during the preparation of this research, February 13, 2020 (on an anonymous basis). 26 The Institut für Europäische Politik (Berlin) in cooperation with the New Europe Center (Kyiv) organized the first Germany Breakfast Debate in Kyiv, March 12, 2020 in the framework of the project „German Ukrainian Researchers Network“ (GURN) . The GURN is supported by the German Federal Foreign Office. http://neweurope.org.ua/plechem-do-plecha-z-ukrayinoyu- nova-yevropa-provela-u-kyyevi-pershyj-nimetskyj-snidanok/ 2. Ukrainian Priorities and Perceptions regarding cooperation with Germany 17
it is likely that the global crisis will have an adverse effect on it. It should be noted that Germany was to be one of the first foreign visits by Ukraine’s new Minister of Foreign Affairs, Dmytro Kuleba. Due to COVID-19, the ministers of the two countries negotiated in a video conference.27 This example shows that if there is a political will to maintain dialogue and develop cooperation, there will always be opportunities. Thus, to summarize, the Ukrainian authorities are generally focused on deepening the cooperation with Germany and on reform-related issues. The current challenge is to identify and be able to implement the relevant projects and initiatives.
27 MFA of Ukraine. Kuleba and Maas held one-hour talks within the framework of their first virtual visit. March 24, 2020. https://mfa.gov.ua/news/kuleba-ta-maas-proveli-godinni-peremovini-u- ramkah-pershogo-virtualnogo-vizitu 18 PRIORITIES AND EXPECTATIONS FROM UKRAINE AND GERMANY: How to make bilateral relations more sustainable
3. GERMAN PRIORITIES AND PERCEPTIONS REGARDING COOPERATION WITH UKRAINE
On the whole, our interlocutors in active promotion of Ukrainian civil Germany divided the Ukraine portfolio society since 2014 is also relevant. into two sections: Donbas and the Thirdly, Germany is also pursuing its reform processes. Although some of own interests to some extent, those interviewed spent more time especially those that involve addressing the Donbas question than stabilizing Ukraine and facilitating the issue of reforms, in general the economic growth, from which Germany, latter were considered equally as one of the largest exporting important.28 Under reforms the countries, could also benefit. Germany following areas were given particular is aiming for a long-term relationship emphasis: Decentralization, the that provides opportunities for economy, energy, the judiciary and institutional cooperation and requires institution building, which seem to be a certain degree of predictability on the main focus of German support to the part of Ukraine. It is therefore no Ukraine. This is evident based on the coincidence that our interlocutors fact that, firstly, these reform areas mentioned such areas of cooperation were explicitly mentioned by most of as decentralization, the economy, our interlocutors. Secondly, German energy, justice and institution support involves not only concrete building, as they are interlinked and financial packages, but also specific the successful reform of these areas initiatives in these areas and in some would indeed create a predictable cases the appointment of high-ranking environment for developing the experts as advisors. In this context, the relationship. The emphasis on these specific reform areas may also be due to the fact that in 2015 Germany Germany is aiming for a long-term relationship adopted a Ukraine Action Plan,29 that provides opportunities for institutional which included inter alia these focal cooperation and requires a certain degree of points. This points to an overall predictability on the part of Ukraine. coherence in the German approach towards Ukraine.
28 A number of German politicians and officials responsible for various aspects of German policy towards Ukraine were interviewed in the course of the research for this paper. Their responses serve as the basis for the analysis in this chapter. However, since all interview partners were promised anonymity, no names have been provided. 29 See footnote no 2 3. German priorities and perceptions regarding cooperation with Ukraine 19
With regard to the reforms, the interviews also revealed that the Germany relies primarily on institutional transfer of power in Ukraine, which cooperation and treats personal communication as resulted in a new president, parliament secondary. and government, was not perceived as having a negative impact on cooperation. Most interviewees did not individual working teams took a long see the shift in the presidency from time and that instead of dealing with Petro Poroshenko to Volodymyr reforms, the Ukrainian leadership Zelenskyy as problematic. However, the devoted too much time to personnel fact that the government led by former changes. In this context, the departure Prime Minister Oleksiy Honcharuk was of the Honcharuk government, replaced in March and that some whose work was described positively, reforms are not progressing very well was perceived as a negative signal was seen more negatively. These views because it reflected the fluctuation can be partly explained by the fact of personnel overall. This ongoing that Germany relies primarily on fluctuation is seen as contributing to institutional cooperation and treats the creation of an unstable political personal communication as secondary. situation in which the necessary The only exception here is the Donbas predictability for a well-functioning question, in which personal relations bilateral relationship is not necessarily between Poroshenko and Chancellor present. Angela Merkel did play an important role. The relations at the highest level do not seem to be as decisive now. With regard to the Donbas, the 3.1. COMMUNICATION AND election of the new president was COORDINATION AS ONGOING associated with the hope that the CHALLENGES dialogue between Russia and Ukraine would be resumed and would bring a renewed impetus for conflict Despite the fact that the interviews resolution (see also the Donbas were conducted with stakeholders section below). representing different areas of cooperation between Germany and A common thread running through Ukraine, the topic of communication several interviews was the criticism and coordination played a role of the implicit shift of power from for almost all interlocutors, albeit the parliament to the new president. in different ways. It became clear One interlocutor described the that the German side places a high parliament as the “secretariat of priority on the role of institutions the president”, which appears to be and formalized interactions in subordinate to President Zelenskyy the bilateral cooperation. As and is marginalized in its role, even if a consequence, institutional this may be changing now. Some noted coordination and formal rather than that the institutional restructuring personal communication are regarded of ministries under Zelenskyy and of as paramount. 20 PRIORITIES AND EXPECTATIONS FROM UKRAINE AND GERMANY: How to make bilateral relations more sustainable
From a German perspective the during official meetings. This relates Ukrainian side at times communicates primarily to the work in the areas of on a more personal, less formal level decentralization and the economy. rather than as representatives of the Another point that was highlighted in state and its institutions, leading to a regard to coordination is the role of casual style with which some (partially state-financed) German civil interlocutors did not feel comfortable. society organizations that are involved In this context, they differentiated in institutional cooperation between between the Zelenskyy and the the two countries. The inclusion of such Poroshenko presidencies. While institutions is perceived as particularly diplomacy under Poroshenko was positive, and this applies to both viewed as more traditional and German and Ukrainian interviews. This professional, under Zelenskyy a less was especially made clear by examples formal style is seen to predominate in in energy and business (see below) some areas (this will be expanded and can be explained by the fact that upon in the Donbas section below). the German organizations handle most Another problem mentioned in regard of the bureaucratic tasks and thus to formal communication was an facilitate the work of German ministries. occasional asymmetry between Ukrainian interlocutors confirmed that German and Ukrainian delegations to the Ukrainian side was pleased that official meetings. While the German “German partners themselves control side makes an effort to include all the selection of applications and the relevant officials, Ukrainian use of funds.” We can therefore assume delegations sometimes consist of that German organizations help to use surprisingly few representatives. This funds properly in this context. creates the impression that the meetings are not sufficiently prepared The channels of communication seem for by the Ukrainian side, which is to be very different. In some cases, thus perceived as rather communication takes place via the unprofessional. German and Ukrainian embassies and in other cases directly with Ukrainian From a German perspective, institutions counterparts in the ministries or the and formalized communication formats parliament. It is noticeable, however, are also important in order to enable a that there is no sustainable, effective smooth coordination process. Numerous overall communication platform that German interlocutors mentioned that a would make it possible to maintain a lack of coordination between individual close exchange on the general state of Ukrainian ministries became evident bilateral cooperation. In the Ukrainian interviews the wish to create such a format of cooperation was expressed, It is noticeable, however, that there is no with special reference to the high-level sustainable, effective overall communication intergovernmental consultations which platform that would make it possible to maintain took place under former President a close exchange on the general state of bilateral Leonid Kuchma and former Chancellor cooperation. Gerhard Schröder, as well as at the level of the German and Ukrainian MFA. 3. German priorities and perceptions regarding cooperation with Ukraine 21
Another point in regard to growing capacity of the communities to communication raised during the deal with their problems more interviews is the impression of some efficiently and competently is also German interlocutors that the Ukrainian emphasized. There was originally some side does not sufficiently appreciate the concern about the attempts by local support provided by Germany. However, oligarchs to benefit from the some of them also pointed out that decentralization process, but currently Germany needs to make a more there is a greater inclination to see the concerted attempt to communicate process as contributing to the fight its actions better, because the value against corruption, because more of the placed on cooperation and the efforts revenue raised locally stays local and made are not always adequately can be more easily controlled or acknowledged. monitored by citizens. In addition, the benefits of decentralization are believed to serve as an incentive for German companies to expand their 3.2. DECENTRALIZATION involvement in Ukraine, as they profit AS A “FLAGSHIP” REFORM from the delegation of decisions to the local level, the reduction in corruption One of the reform areas viewed and the improvements in infrastructure as key in the Ukrainian context is that result from the reform. decentralization. It is also one of those in which Germany has been most directly involved. This area of The shift from the Poroshenko to the Zelenskyy reform is seen by those interviewed presidency is not seen as significant with regard as being largely a success, and also as to the decentralization developments. being more or less irreversible. One interlocutor referred to it as a “flagship” reform and some of those interviewed emphasized the democratizing impact The shift from the Poroshenko to of the process: “The spirit of autonomy the Zelenskyy presidency is not is out of the bottle. This is the most seen as significant with regard to important success of decentralization.” the decentralization developments. Numerous interviewees mentioned More importance is attached to the specifically the contribution made differences between the governments by Georg Milbradt, Germany’s special led by Arseniy Yatsenyuk and by representative for this area. He is Volodymyr Groysman. The former believed to be both visible and had major achievements in the influential with regard to this dossier. decentralization field, while the latter was less productive in this area. One The benefits of decentralization are interlocutor also commented that it perceived to be manifold, with the was in general easier to work with emphasis depending on the Yatsenyuk, because he spoke English interlocutor. Economic dividends for the well and was more inclined to explain communities involved are regarded as his view of the situation and his being one of the main advantages. The motivations. 22 PRIORITIES AND EXPECTATIONS FROM UKRAINE AND GERMANY: How to make bilateral relations more sustainable
There is, however, also criticism of some the process and its implications, in aspects of the decentralization process. order to increase citizens’ level of Those most familiar with it believe that understanding about the reforms and the Ukrainian constitution needs to be their participation in them. changed in order to allow for more clarity with regard to the competences of the various levels. The initial situation with respect to the criteria for 3.3. ECONOMY: THE “SEARCH merging communities is not believed to FOR INVESTORS” APPROACH IS have been sufficiently clear, nor were NOT WORKING WELL the deadlines for the mergers adequately set and communicated. There are also doubts about the idea of Our interlocutors emphasized that introducing prefects, which is seen as economic cooperation between leading to a potentially dangerous Ukraine and Germany has been vertical power channel. On the whole, steadily increasing since 2014. The decentralization is still seen as a work reason given for this positive tendency in progress rather than a completed was, first of all, the implementation reform. In this area, as elsewhere, the of the EU-Ukraine Association coordination across various ministries Agreement, particularly the Deep was characterized as poor to non- and Comprehensive Free Trade Area existent. (DCFTA). Other reasons, such as the reorientation of the Ukrainian economy Finally, some of those interviewed towards the EU in the wake of the believe the Ukrainian side could do a Russian aggression, also contributed better job of communicating to those significantly to the increased involved on the German side which cooperation between Germany and type of expertise is needed in the Ukraine. Another important factor in realm of decentralization. Currently this regard was the decentralization there is a sense among some German reform, which, according to our interlocutors that various actors on the interview partners, reduced corruption Ukrainian side view the intervention and simplified procedures for German of the EU and the member states with companies by no longer requiring suspicion or even resentment. Others, a decision to be taken in Kyiv, but however, stated that they did not rather by addressing many problems share this view. One piece of advice at the local level. Decentralization from the German side with regard to reform was described as the “most decentralization would be to involve positive development” and led German citizens in active discussions about companies that have been operating in Ukraine for many years to expand and create new jobs. Decentralization reform was described as the “most positive development” and led German The intensification of economic companies that have been operating in Ukraine for cooperation between Germany and many years to expand and create new jobs. Ukraine can be seen not only in the growth in bilateral trade, but 3. German priorities and perceptions regarding cooperation with Ukraine 23
also in the expansion of formats also noted in some German interviews for cooperation. Firstly, they include that a skeptical attitude in Ukraine new structures, such as the German- towards the role of international Ukrainian Chamber of Industry and partners, especially the IMF, was Commerce (AHK Ukraine), which was viewed critically and did not contribute founded in Kyiv in 2016. Secondly, to Ukraine’s image as a stable country high-ranking German advisors are that is looking for investors. also involved in this work, including Rainer Bomba, Special Representative of the Federal Government for German interlocutors also noted that the absence Privatization, and experts from the of legal security, high production costs, a lack German Economic Team, who analyze of qualified workers and compliance risks pose the economic situation in Ukraine on great challenges to doing business in Ukraine for behalf of the German government and German companies. support reforms in Ukraine through their analyses. Individual targeted programs that are implemented by German interlocutors also noted that German organizations, including the the absence of legal security, high German development agency GIZ, production costs, a lack of qualified also build the capacities of Ukrainian workers and compliance risks pose businesses and support exchanges great challenges to doing business between German and Ukrainian in Ukraine for German companies. In companies. this context it was also mentioned that since 2018 Germany has not Despite the positive developments, our issued any investment guarantees interlocutors point out that there is no for German enterprises in Ukraine as rush by new German companies to these are associated with too high enter Ukraine. It seems that the shift in a level of risk. At the same time, it is focus from “diplomacy of symbols” worth mentioning that the initiative under Poroshenko to the “search for of the Ukrainian president to organize investors” under Zelenskyy, as it was an investment forum in Mariupol in described in Ukrainian interviews, is October 2019 was perceived as very not working well. The dismissal of successful. Ukrainian Finance Minister Oksana Makarova and the end of the It was further emphasized that the Honcharuk government in March 2020, institutional cooperation between as well as the role of the oligarch Ihor Germany and Ukraine in the form of Kolomoiskyi, who is believed to have the “High Level Group for Economic gained more influence under President Issues” – which is coordinated by the Zelenskyy, were seen as negative German Ministry of Economic Affairs developments in this context.30 It was and Energy (BMWi) and has been
30 As mentioned in the introduction, events which took place after the interviews could generally not be taken into account. This also applies to the passage of the so-called anti-Kolomoiskyi law on the re-privatization of nationalized banks. 24 PRIORITIES AND EXPECTATIONS FROM UKRAINE AND GERMANY: How to make bilateral relations more sustainable
active since 2005 – is regarded as the outside world. Otherwise, in the relatively inefficient during both the context of Ukraine, one knows only Poroshenko and the Zelenskyy “war and revolutions”, which do not presidencies because of the provide a positive image of stability. continuing lack of coordination across Finally, the suggestion was made that Ukrainian ministries. Many Ukraine should attract investments interviewees have the impression that which offer a higher added value. Ukraine does not attach much importance to cooperation in this group. Surprisingly, however, the cooperation within the framework of 3.4. COOPERATION IN THE German-Ukrainian intergovernmental ENERGY FIELD: VERY POSITIVE negotiations, coordinated by the German Ministry for Economic The cooperation between Germany Cooperation and Development and and Ukraine in the field of energy focused on technical support, was is perceived as “very positive”, perceived very positively. The reasons and the change of president and are first of all the clear interest from government in Ukraine did not the Ukrainian side in cooperation in lead to any alterations in the form this group and secondly the fact that or quality of this cooperation. German organizations are involved in It was stressed that the former the cooperation and are responsible energy minister, Nataliya Boyko, for the implementation of numerous was considered “very competent” projects in Ukraine. and that the fact that “young and progressive people” are in Some interviewees emphasized power provides a rather positive that Ukraine as a state should impression. cooperate much more closely with the Ukrainian business sector, and should In our interviews the following promote industrial clusters, which German priorities for cooperation in turn could support cooperation were highlighted: increasing energy among universities, companies, and efficiency in both industry and professional associations. It was residential buildings, and expanding also recommended that Ukrainian renewable energy in Ukraine. With companies should be involved in regard to industry, however, it communication about Ukraine abroad, was noted that increasing energy so as to provide positive examples to efficiency is not envisaged for companies under the control of oligarchs, which are seen as having The cooperation between Germany and sufficient resources to conduct such Ukraine in the field of energy is perceived as programs themselves. It was also “very positive,” and the change of president pointed out that the cooperation and government in Ukraine did not lead to aims to introduce new priorities, any alterations in the form or quality of this including the promotion of a phase- cooperation. out of coal and improvements in the heating sector. 3. German priorities and perceptions regarding cooperation with Ukraine 25
Constructive cooperation is also The bureaucracy at the Ukrainian made evident in the new initiatives Ministry of Energy was perceived as that have emerged between the a challenge to establishing efficient two countries with the aim of cooperation in the sense that it making energy cooperation more slows down processes. It is therefore institutionalized. In 2019, for no coincidence that Germany in example, the decision was made to consultation with Ukrainian partners seek a German-Ukrainian energy is seeking to create a new structure partnership, which would contribute for coordinating cooperation. to deepening cooperation and pushing forward the modernization Although our interview partners were of the Ukrainian energy sector. The certainly aware of the controversy signing of the partnership was surrounding the Nord Stream 2 scheduled for spring 2020. The first pipeline, the issue was only raised by German-Ukrainian Energy Days those working more or less directly were also planned for 2020. In talks on energy questions. This indicates between the German and Ukrainian that the ongoing construction of energy ministries, agreement was the pipeline is not perceived as also reached on creating a new a major hurdle to continuing and institution in Ukraine, which would even intensifying cooperation with be based at the Ukrainian Ministry of Ukraine. In those conversations Energy and and Environmental Policy where the Nord Stream 2 pipeline and would foster energy cooperation was mentioned, it was not described between the two countries. However, as a problem in relations between in view of the COVID-19 crisis these Germany and Ukraine, nor was it measures have had to be postponed. perceived as affecting cooperation. In this context, it was emphasized The outstandingly positive course of that Germany is very much in favor of the cooperation in the field of energy gas transit via Ukraine and sees Nord can also be explained by the fact Stream 2 primarily as an opportunity that most of the work is not carried to reduce the price of gas in Europe. out only via the two ministries, but The Ukrainian side is expected rather through other institutions. to modernize power supplies These include the German Energy and introduce an electricity stock Agency (dena), the GIZ and Germany’s exchange. development bank, the Kreditanstalt für Wiederaufbau (KfW). For example, dena has been commissioned to organize the Energy Days, while 3.5. NATO: NOT A PRIORITY FOR the issue of lending is handled by COOPERATION the KfW. The institutions involved in this process would appear to Overall our German interlocutors act as intermediaries and exert appear satisfied with the current level a positive influence on bilateral of NATO-Ukraine cooperation. However, cooperation as was mentioned those not directly involved with this in the economic section above. area tend not to mention it, leading to 26 PRIORITIES AND EXPECTATIONS FROM UKRAINE AND GERMANY: How to make bilateral relations more sustainable
the conclusion that this dossier is not From a German perspective, NATO has perceived as a priority area of the been extremely supportive of Ukraine, relationship. arguably more so than of any other non-NATO member. In this context German diplomats emphasize their the declaration of the NATO-Ukraine appreciation for Ukraine’s efforts Commission on the Sea of Azov was with regard to the relationship with mentioned, as was more broadly the NATO. In this context they mention package of measures adopted by NATO an offer made by Ukraine concerning regarding the Black Sea. involvement in the situation in Iraq as a non-NATO country, as well as For the future, the option of an Zelenskyy’s first trip to Brussels, during Enhanced Opportunity Partnership which he met with not only EU but also is seen as an appropriate one for NATO representatives. Thus, Ukraine Ukraine, and one that Germany could is perceived as actively supporting support. Although it is uncertain its relationship with NATO on both which specific criteria would apply, the rhetorical and practical levels. No since the countries with this status concerns were expressed about a lower to date are very diverse and their level of commitment to NATO under the situations are not necessarily Zelenskyy presidency. The Hungarian comparable to the Ukrainian one, efforts to block the relationship from nonetheless the idea of pursuing this going forward are generally seen as path is generally welcomed by the unhelpful. German side.
German diplomats emphasize their appreciation for Ukraine’s efforts with regard to the relationship 3.6. DONBAS: MAJOR HOPES with NATO. ASSOCIATED WITH ZELENSKYY
The Donbas dossier is seen as one of the main priorities of the German At the same time there are definitely government with regard to Ukraine. As areas in which Ukraine needs pointed out above, our interlocutors to improve, according to those divided the Ukraine portfolio into two interviewed. They stress that the sections: Donbas on the one hand and requirements of NATO have remained reform-related issues on the other. the same over time. These include On the whole, both sections were a reformed security sector, ensuring considered to merit equal attention. that it is based on meritocratic Since the relationship with Ukraine is criteria and eschews nepotism and covered by numerous people sitting cronyism, a functioning administrative in different ministries, as well as in apparatus and justice system, and the Bundestag, the percentage of time effective parliamentary control. and resources devoted to any one Ensuring democratic control over the issue overall is difficult to assess. But armed forces was singled out as a key it seems clear that apart from a few criterion. people whose efforts are primarily 3. German priorities and perceptions regarding cooperation with Ukraine 27
dedicated to this dossier, the majority of German civil servants dealing with The approach to the situation in the Donbas is seen Ukraine are tasked with addressing by German decision-makers as an area in which other issues. major change has occurred in conjunction with the departure of Poroshenko as president and the The approach to the situation in the arrival of Zelenskyy. Donbas is seen by German decision- makers as an area in which major change has occurred in conjunction he declared his desire to engage in with the departure of Poroshenko as bilateral conversations with Putin president and the arrival of Zelenskyy. and took the initiative on this. These Whereas negotiations eventually stalled conversations started prior to the under Poroshenko, in particular due to summit and continued during as well President Vladimir Putin’s negative as after it. All of these steps were attitude toward him, there was a taken as generally positive signs by significant change in both the tone and the German side. There was, however, content of this dossier once Zelenskyy some concern voiced about the fact came to power, according to our that the Ukrainian side did not keep discussion partners. Germany informed of decisions taken in the course of the prisoner exchange, First of all, Zelenskyy declared peace in particular the decision to include to be his first priority, even during his former members of the Berkut special election campaign. Second, following police force. This was problematic his election, he introduced new because their transfer to the Russian momentum into the Minsk Process side made it even more difficult and the relationship with Russia, to prosecute those responsible for starting with a prisoner exchange suppressing the Maidan protests of and an agreement on reconstructing 2014, as Berkut was directly involved the bridge at the crossing point in in this suppression. Stanytsia Luhanska, among other measures. Third, he placed a high The Donbas dossier is of great priority on holding a summit at the importance to the German side highest level in the Normandy Format, because of German involvement in the and took the necessary steps to make drafting of the Minsk Agreements and this possible. In particular, he agreed the investment of significant political to the so-called Steinmeier Formula, capital in the matter at the highest which specified the relationship level from the very beginning. The between holding local elections in the German side was thus very motivated occupied territories and giving those by what they perceived as new areas a special status. Furthermore, momentum under Zelenskyy and tried he ensured that troop disengagement to take full advantage of it. At the occurred at three places along the same time the Germans were contact line, something that was somewhat concerned about the agreed upon by the parties, even proposals introduced by the French though this was very controversial president, Emmanuel Macron, in the Ukrainian context. Finally, regarding dialogue with Russia. 28 PRIORITIES AND EXPECTATIONS FROM UKRAINE AND GERMANY: How to make bilateral relations more sustainable
However, in the end these proposals certain aspects of policy, without any did not interfere with the work of the visible teams behind them for support Normandy Format. Germany and and reinforcement. France stayed on the same page and did not exert pressure on Ukraine to Criticism was also expressed make additional concessions to Russia. concerning Zelenskyy’s behavior at the On the whole, German diplomats were Normandy Format summit in Paris in pleased that Zelenskyy and Putin were December 2019. According to some able to discuss questions relevant to of those involved in the preparations, the Donbas bilaterally, although the Zelenskyy proposed introducing German side also saw a potential changes to a document that had danger in this. The Germans already been finalized and accepted furthermore hoped that the by all sides prior to the summit. This replacement of Vladislav Surkov by was seen as a further example of Dmitrii Kozak as Russia’s chief Ukraine untraditional diplomatic methods. negotiator represented a sign that However, in general the German side Putin might be willing to change his was pleased that the summit was line on Ukraine to some extent. able to take place and overall was satisfied with its results. In the first weeks following the summit the Germany and France stayed on the same German side was optimistic about the page and did not exert pressure on Ukraine to progress on the points agreed upon make additional concessions to Russia. in Paris. However, over time concern grew that the points were not in fact being implemented as planned. After Some criticism was voiced by German the beginning of the coronavirus crisis interlocutors regarding the style the German side wished to keep the of communication employed by momentum going and to not allow the Ukrainian side in interactions the pandemic to serve as a pretext concerning the Donbas dossier. There for postponing the implementation was a sense that the Ukrainian side of the agreed-upon measures. So, was at times lacking in professionalism in cooperation with the French, the and that communication tended to be decision was taken to initiate a meeting too informal and ad hoc, not adhering of the foreign ministers in a video to the usual protocol or even to basic format on April 30 in Berlin. However, standards of politeness between the German side clearly recognized that people who do not yet know each other meetings held via virtual platforms can particularly well. More generally, some in no way be as effective as personal of those interviewed interpreted the encounters. Ukrainian approach as a departure from traditional diplomacy to a more ad hoc, With regard to the creation of an transactional style of getting things Advisory Council consisting of done, which was generally not seen in representatives from both the Ukraine- a favorable light. This also involved a controlled side of the Donbas and the more personalized approach, in which occupied areas, the opinion was individuals were wholly responsible for expressed that it would be useful to 3. German priorities and perceptions regarding cooperation with Ukraine 29
have such an entity in order to promote dialogue between the two societies. In general, Germany supports both the idea of a national dialogue and the inclusion of internally displaced persons (IDPs) in it. However, there was skepticism regarding the need to connect this dialogue in some way to existing formats within the Minsk Process, including the Trilateral Contact Group. Thus, the Ukrainian side’s idea of creating a bridge between the TCG and the Normandy Format, by more explicitly involving Germany and France in the former, is apparently not shared by the German side, at least not at this stage of developments.
Some of those interviewed interpreted the Ukrainian approach as a departure from traditional diplomacy to a more ad hoc, transactional style of getting things done, which was generally not seen in a favorable light.
Overall, the interviews revealed that the German side views Russia as the aggressor in the conflict and thus as a party to it rather than as a mediator, even if this does not always come through clearly in diplomatic interactions. It is acknowledged that Russia also needs to take steps toward the implementation of the Minsk Agreements and that unilateral action by Ukraine in this respect will not be sufficient. Germany is very appreciative of the fact that Ukraine has produced concrete initiatives in the context of working toward a resolution. More generally, such initiatives in other fields are equally appreciated and from the perspective of the German side it would be positive if Ukraine could be more proactive about proposing them. 30 PRIORITIES AND EXPECTATIONS FROM UKRAINE AND GERMANY: How to make bilateral relations more sustainable
4. CONCLUSIONS
It is clear that the German-Ukrainian composition of the parliament changed relationship has deepened significantly dramatically, with over 75% of those since 2014. The primary impetus for elected being new to the institution. this intensification of relations came These changes also included the from outside the two countries, from formation of a new government under both the illegal Russian annexation of Oleksiy Honcharuk, which was then Crimea in 2014 and Russian aggression replaced in March by one under the towards Ukraine regarding the Donbas. premiership of Denys Shmyhal. However, the Maidan protests, or Revolution of Dignity as they are known These developments naturally raise in Ukraine, also played a role because questions about the evolution of the they demonstrated the desire of a large German-Ukrainian relationship in part of the Ukrainian population for this new environment. We thus return major reforms, an end to high-level here to the questions posed in the corruption and a clear commitment introduction regarding the current to EU integration. From these two state of cooperation, the impact of very different types of developments the political shifts outlined above, emerged the principal foci of the and the expectations and challenges German-Ukrainian relationship perceived by both sides with regard to today: the reform agenda and the the future. In this conclusion we offer developments in and concerning the the responses to these questions that Donbas. were provided during the interviews conducted with officials in both the The relations between Germany and Ukrainian and the German contexts. Ukraine between 2014 and 2019 were naturally shaped by the interactions between Chancellor Angela Merkel and President Petro Poroshenko, as well as by the actions taken by the governments of Arseniy Yatsenyuk and Volodymyr Groysman and the parliament that was in place during these years. Obviously 2019 brought about a major shift in the Ukrainian political environment. Not only was a political newcomer, Volodymyr Zelenskyy, elected president, but the 4. Conclusions 31
What is the state of cooper- Ukrainian society, not the position ation between Germany and of the international community. Ukraine after the first year One example of this behavior is the of Volodymyr Zelenskyy’s dismissal of Prosecutor General Ruslan presidency? Ryaboshapka despite Zelenskyy’s awareness of the G7 position in favor of According to Ukrainian officials, keeping Ryaboshapka in the post. Germany remains very high on Ukraine’s foreign policy priority list. In terms of the Donbas, Ukrainian At the moment, it is ranked among decision-makers point to Berlin’s the top three strategic partners of firm position on the issues related to Ukraine (along with the United States deterring Russian aggression (including and Poland). The German side did not sanctions) as the primary strong point engage in any kind of ranking exercise in Ukrainian-German relations. At the but rather focused on the specifics of same time, there is a sense among the development of the relationship Ukrainian officials that this support is with Ukraine, in which reforms and the fading. The main concern in Kyiv is the situation concerning the Donbas are future departure of Chancellor Merkel. the clear priorities. This is one of various indications that the Ukrainian side places more With regard to reforms, the German emphasis on the role of specific side emphasizes the need for a stable persons and the quality of personal and predictable situation in terms of relationships than the German side the economy and rule of law, which does. would allow for a deepening of the existing cooperation. Institutional and German officials are in general rather formalized cooperation is seen pleased with the development of the as key and takes clear precedence Donbas dossier. Even if they hoped over personal relationships between to see more progress with regard officials. There is no particular reform to the implementation of the Minsk that dominates the discourse. Rather, Agreements, particularly after the most German interlocutors emphasize Normandy Format summit in Paris in the need for multiple interlocking December 2019, they recognize that reforms. this is not to be expected unless the Russian side changes its approach. The Ukrainian side assesses They would, however, appreciate a more Germany’s contribution to the reform systematic, less ad hoc approach from efforts positively on the whole. In the Ukrainian side and emphasize their particular, officials in Kyiv underlined desire to be kept informed of Ukrainian Berlin’s decisive steps in the area initiatives and intentions. of decentralization. However, it is noticeable that President Zelenskyy Both sides appreciate the role of does not rely on advice from external civil society’s contribution to the partners to the same extent that Petro relationship, although this seemed to Poroshenko did. Instead, he focuses be somewhat more pronounced on primarily on the reactions of the the German side. This applies both 32 PRIORITIES AND EXPECTATIONS FROM UKRAINE AND GERMANY: How to make bilateral relations more sustainable
to the efforts towards strengthening were highlighted in the Ukrainian civil society in Ukraine and to the interviews as the new priority in involvement of German civil society relations with Germany. From a organizations as intermediaries to Ukrainian point of view, the focus of implement German policies and German business should not be on projects regarding Ukraine. attracting Ukrainian workers to their companies in Germany, but on creating There is no shared assessment of the more jobs and opening more German problems in the relationship. Ukrainian companies in Ukraine. From a German decision-makers named two major perspective such an approach cannot failures in the relations. The first is the function well yet due to a lack of restoration of the Russian delegation’s concrete reform measures in certain powers in the Parliamentary Assembly areas, especially in the fight against of the Council of Europe (PACE), which corruption. was supported by Berlin. The second and key one is German government The majority of officials on the German support for the Nord Stream 2 project. side did not see any major changes in German interlocutors, on the other cooperation as a result of the political hand, referred to internal Ukrainian shifts in Ukraine. From their perspective, issues as problematic. While aware the institutional cooperation has been of the Ukrainian opposition to able to continue largely as before. Nord Stream 2 and Russia’s PACE This indicates a potential opportunity membership, they did not focus on for Ukraine. Instead of focusing on these or even necessarily see them specific political figures such as as obstacles to cooperation between Chancellor Merkel, it would be more Germany and Ukraine. Rather, they productive for the Ukrainian side to mentioned developments such as foot- work on strengthening institutional dragging with regard to certain reforms connections in order to ensure that and the lack of coordination across cooperation can continue more or less ministries. uninterrupted independent of political changes in either of the countries. In this context Ukraine could make better use of existing platforms such as the What impact have the shifts “High Level Group for Economic Issues” in the Ukrainian political coordinated by the German Ministry of landscape, which resulted Economic Affairs and Energy (BMWi). not only in a new president but also in a radically differ- Where Germany does see a significant ent parliament and two new shift starting in 2019 is in the Donbas governments, had on the dossier. While there was originally bilateral relations? some skepticism regarding Volodymyr Zelenskyy, this quickly changed into With Volodymyr Zelenskyy’s coming to hope due to his proactive initiatives power in Ukraine, the foreign policy concerning the Donbas, which were focus has shifted to the search for recognized and appreciated. These investors. Investments and investors initiatives were extremely important to 4. Conclusions 33
the German side because of Germany’s as agreed at the Normandy Format high level of political investment in summit in Paris. The third would be the Minsk Process and the Normandy increased German pressure on Russian Format in particular. At the same President Vladimir Putin to facilitate time, there is concern on the German further prisoner exchanges, which are side about a perceived shift by their Zelenskyy’s number one priority. Ukrainian counterparts away from a more traditional, formal style of Other Ukrainian goals for the diplomacy to a more casual, ad hoc relationship include advancing with approach. the country’s agenda regarding the relationship with the EU and NATO. Concerning the EU, Ukraine’s priority for 2020 is to sign the ACAA agreement What are the expectations to enhance the access of Ukrainian and challenges for these re- industry to EU markets. With regard lations and to which extent to NATO, the Ukrainian aim is to be is the groundwork for future invited to conclude an agreement on sustainable cooperation be- an Enhanced Opportunities Partnership tween Germany and Ukraine (EOP). On both issues Ukraine counts on being created? German support.
The main thrust of expectations from With regard to the instruments the Ukrainian side can be described as and mechanisms underlying the to have “more Germany in Ukraine.” Due cooperation, the Ukrainian side had to the current government priorities two proposals. The first would be to this can be interpreted as more German conduct an audit of the existing toolkit, investments in Ukraine. Apart from i.e. to assess and possibly update the this, specific Ukrainian expectations tools, frameworks or sectors relating regarding various areas of domestic to the assistance received by Kyiv from reform appear to be largely absent. In Germany since 2014. The evaluation contrast, there are clearly articulated of the assistance could conceivably be desires expressed by the Ukrainian provided by an independent group of side with regard to the Donbas. These experts who would conduct qualitative include first of all the defense of the research based on interviews inter idea of a “flexible Minsk”, meaning alia with Ukrainian stakeholders. The in particular revising the sequence second recommendation would be to of points in the Minsk Agreements create a high-level communication to include internationally supported platform to maintain an ongoing Ukrainian control over the Ukrainian- political dialogue on multiple aspects Russian border prior to holding local of the relationship. The Ukrainian elections. side believes that it would make sense to restore the high-level The second expectation would be intergovernmental consultations that active German support for access by took place under President Leonid humanitarian organizations such as the Kuchma and Chancellor Gerhard Red Cross to the occupied territories, Schröder. They propose upgrading this 34 PRIORITIES AND EXPECTATIONS FROM UKRAINE AND GERMANY: How to make bilateral relations more sustainable
format by carrying out the consultations One conclusion that can be drawn on an annual basis. Such a platform from the interviews is that the German might be attractive to the German side interactions with Ukraine are rather as a channel through which German compartmentalized by sector of support could become more visible and cooperation, whereas the Ukrainian side more clearly communicated. views the relationship in a more holistic manner. Another is that communication On the German side the expectations is perceived very differently by the are less specific and explicit. In general, two sides and could benefit by being Germany expects the Ukrainian side broadened and enhanced, both in order to keep up sustained reform efforts to profit from possible synergies and to and to avoid any further erosion improve coordination across ministries of the separation of powers. These and other agencies. In this sense the more generalized expectations point Ukrainian idea of assessing existing to a fundamental asymmetry in the instruments and potentially creating a relationship. While German support is new platform for broader consultations viewed as essential in Ukraine, on the should be carefully examined. German side the relations with Ukraine are clearly important, but represent one among many foreign policy priorities. At the same time, Germany has invested a significant amount of political capital and concrete support in the relationship with Ukraine. In addition, there is a certain economic interest motivating numerous German actors, despite existing obstacles to further investment.
Germany intends to continue pursuing collaboration at the institutional level in the existing areas of cooperation. This brings with it the implicit expectation that the Ukrainian side will adhere to previously made commitments within the framework of bilateral cooperation as well as in the EU context (in particular the Association Agreement/DCFTA). As long as the Ukrainian side keeps on delivering on its commitments regarding the reform processes, the interest in maintaining and even intensifying the relationship on the German side can be expected to persist. About the authors 35
ABOUT THE AUTHORS Alyona Getmanchuk is Director of the New Europe Center, an experienced Ukrainian think tank manager and foreign policy analyst. Her previous achievements include her engagement with the Institute of World Policy, where she served as a co-founder and director for 8 years. Her research interests are perception of Ukraine in the EU, regional security, Euro-Atlantic integration, Ukraine’s relations with Germany, Poland, and the USA.
Ljudmyla Melnyk is Research Associate at the Institut für Europäische Politik (IEP, Berlin). Her main research focus is the development of civil society, particularly think tanks, as well as the evolution of German-Ukrainian relations. She also manages the project «German Ukrainian Researchers Network» (GURN), which is supported by the German Federal Foreign Office.
Sergiy Solodkyy is the First Deputy Director of the New Europe Center, an expert in foreign policy, international relations, and security. His research interests are security policy, European and Euro-Atlantic integration of Ukraine, Ukraine’s relations with Russia, Germany, Romania, and the UK.
Dr. Susan Stewart is Acting Head of the Eastern Europe and Eurasia Division of the German Institute for International and Security Affairs (SWP, Berlin). Her research focuses primarily on the domestic and foreign policy of Ukraine, as well as on the evolution of the EU’s Eastern Partnership and some aspects of developments in and concerning Russia. New Europe Center http://neweurope.org.ua/
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