Ukrainian president fights oligarch on home front as Russian threat looms

His country faces an imminent threat of full-fledged invasion, according to US intelligence services, with more than 100,000 Russian troops amassed at the border. But Ukrainian President Volodymyr Zelensky chose the moment of danger to deepen a national standoff with the country’s richest oligarch, Rinat Akhmetov.

At a press conference late last month, Zelensky claimed, without providing any evidence, that his intelligence services had uncovered plans for a Russian-backed coup that was aimed at attracting support from Akhmetov.

“I think [Akhmetov] maybe not aware, “said the president before adding:” I invite Rinat Akhmetov to [my office] to listen to information that can be shared.

Zelensky’s extraordinary decision to drag a powerful businessman into an alleged conspiracy has dismayed Western analysts and diplomats, given the heightened Russian threat and multiple issues, including the country’s low vaccination rate against Covid- 19 and the high death toll.

Oleksandr Danylyuk, briefly head of national security under Zelensky, said his weakness “is a reluctance and perhaps an inability to consolidate society and elites amid the threat of Russian aggression.”

“At a time when Russia threatens to attack, it is really essential that pro-Western forces in Ukraine work together,” said a Western diplomat who has worked closely with Ukraine. “The current internal fighting in Ukraine is damaging. “

Zelensky won the presidency in 2019, promising to end the war in eastern Ukraine and root out corruption. He made little progress on the former and has a mixed record on reform. A solid economic recovery hoped for after the pandemic has failed.

Ukrainian President Volodymyr Zelensky visits combat positions and meets front line soldiers with Russian-backed separatists in the Donetsk region © Ukrainian Presidential Press / AFP / Getty

Akhmetov, a steel and energy tycoon, called “lies” any alleged involvement in a coup plot. Experts say his TV channels are increasingly critical of Zelensky, raising the bar in a rift between two of Ukraine’s most powerful people.

Meanwhile, the looming fear from Washington to Kiev is that Russia’s military build-up will lead to plans by President Vladimir Putin to destabilize Ukraine and possibly launch a full-fledged military incursion. Ukrainian troops are fighting Russian-backed separatists in regions of the Far East, in a proxy war fomented in 2014, shortly after Putin occupied Ukraine’s Crimean peninsula.

“I don’t remember any other president who was ready to challenge Akhmetov” but “the Russians will exploit this moment when Ukraine is weaker inside,” said Daria Kaleniuk, director of the anti-watchdog body. – Antac corruption.

“Maybe Zelensky thinks attacking the oligarchs will rally the people and ultimately help the national cause of resistance against Russia,” said Timothy Ash, analyst at BlueBay Asset Management.

Since winning the presidency in 2019 after many voters voted to protest his predecessor, Zelensky’s poll scores have plunged. A recent poll showed he could lose a candidacy for re-election, with former ally Dmytro Razumkov, who was ousted this fall as speaker of parliament, positioned to beat him in a runoff.

Experts say that Razumkov received favorable coverage on Akhmetov TV channels. In turn, Zelensky’s deputies boycotted what they see as hostile media.

“Because Akhmetov began to undermine Zelensky’s popularity by using his media,” the president responded with his “fairy tale” claim that the oligarch might be part of a coup plot, said Maria Zolkina, expert at the Kiev Democratic Initiatives Foundation.

© Mykola Tys / SOPA / Sipa US / Reuters

Their dispute is also based on legislation passed this fall aimed at influencing wealthy business figures.

The so-called desoligarchization law would officially register the oligarchs – defining them according to their wealth and media and political influence. This would prohibit them from financing politics, prohibit participation in privatization, and require all contact with officials to be reported.

“Akhemtov is really unhappy with this anti-oligarch law, and to some extent it is really a tipping point,” said Yuriy Vitrenko, general manager of the national gas company Naftogaz and a trusted presidential confidant.

“It is very difficult for the president to implement [the rest of] his reform program unless he changes the situation with the oligarchs.

In comments written to the Financial Times, Akhmetov questioned the fairness of the law, saying, “I am not an oligarch, I am an investor. And I am ready to defend it in Ukrainian and international courts.

“We all need fair competition and a level playing field,” he added.

Political analysts see room for compromise between Zelensky and Akhmetov. “Zelensky wants to end massive criticism. . . which was broadcast on Akhmetov channels, ”said political scientist Volodymyr Fesenko. “Akhmetov wants the president to withdraw or relax the law on oligarchs.”

The oligarchs law was “not the best solution,” a Western diplomat in Kiev said. “The way to denigrate the oligarchs is to improve antitrust law, speed up judicial reform, and build anti-corruption institutions. . . These things will have a bigger impact in the medium and long term.

Some experts and diplomats fear that the Oligarchs Act may be used by Zelensky for a selective crackdown on unfaithful business figures.

“The question is whether the same approach is taken for all oligarchs,” Kaleniuk said. She highlighted Zelensky’s positive coverage on channels owned by Igor Kolomoisky, an oligarch who supported the president’s election campaign.

Since before Zelensky’s election, Kolomoisky has participated in legal battles against PrivatBank, a commercial lender nationalized in 2016 after authorities discovered a $ 5.5 billion hole in its balance sheet. Ukrainian authorities and PrivatBank allege in court cases spanning multiple jurisdictions that Kolomoisky and his partners siphoned off money from the bank they owned.

Ukrainian prosecutors have not brought any charges against Kolomoisky, who denies the corruption allegations.

Addressing parliament this month, Zelensky again hit Akhmetov and other oligarchs without naming them. He unveiled plans to use natural resource taxes for a fund for the country’s next generation to finance higher education and home purchases.

“Then our oligarchs will become real investors in our children,” Zelensky said.

“For the first time in 30 years, we have launched a systematic struggle against the oligarchs. And I’m sure Ukraine will win this fight.

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