To Keep Western Assistance Flowing, Ukraine Must Engage Corruption Concerns Head-On
June 30, 2022
It is regrettable that the words “corruption” and “Ukraine” are often connected in public discourse, even as the country fights for its survival. Despite widespread acknowledgement that Ukraine has undertaken substantial reforms to improve governance, accountability, and rule of law following the Revolution of Dignity in 2013–14, it continues to be saddled by perceptions of rampant corruption. Since the start of Russia’s invasion on February 24, discussions on Ukraine have understandably shifted to issues of defense and security and the question of possible end states. Yet, as foreign assistance from the West increases to support Ukraine’s defense of its territory and keep the economy afloat, concerns about corruption are reemerging. Ukraine’s ability to address these concerns effectively could make or break its strategy to survive and defeat Russia’s assault through deeper ties with Euro-Atlantic partners.
The story of corruption in Ukraine has many chapters, the most recent of which has been defined by the creation of anti-corruption institutions and dramatic improvements to state procurement on one hand, and foot-dragging to fill key positions, bureaucratic infighting, and struggles to reform the judiciary on the other. Overall, the trend line in Ukraine’s efforts to root out corruption has been positive, but inconsistency has been a lasting feature that has frustrated many of Ukraine’s bilateral partners and international financial institutions. Public dissatisfaction with the pace of ongoing anti-corruption reforms was beginning to drag on President Volodymyr Zelensky’s approval rating in the immediate run-up to the war.
Russia’s invasion arguably has opened a new chapter. However, many of the challenges that existed on February 23 have not gone away—something that the foreign policy adviser to German chancellor Olaf Scholz inelegantly alluded to earlier this month when he stated: “Just because you’re attacked doesn’t automatically mean your rule of law improves.”
The bitter truth is that armed conflict tends to exacerbate existing corruption challenges and generate new risks. Anti-corruption researchers have found that postwar states inherit patterns of corruption that existed before and during the outbreak of hostilities. Massive inflows of money, equipment, and humanitarian aid create new opportunities for diversion and graft at a time when the government’s attention is focused on defending its citizens. Anti-corruption institutions often experience personnel shortages as their staff participate in the country’s defense and their normal activities are interrupted by emergency tasks. At the same time, the role of civil society in conducting vital watchdog functions is diminished. Ukraine is no exception to these phenomena; according to a survey of Ukrainian anti-corruption experts taken in mid-April, 84 percent said that they had abandoned their anti-corruption activities due to the war, while a review of the activities of the National Agency for Corruption Prevention found that the organization had discontinued much of its mandated work in favor of new initiatives that, inter alia, trace the assets of sanctioned Russian citizens and coordinate humanitarian aid to Ukrainians in need. The prioritization of security concerns was encapsulated in a comment shared by a Ukrainian participant in a recent private discussion with CSIS: “There is no point in fighting corruption in my country if my country ceases to exist.”
At the same time, the rally-around-the-flag effect triggered by Russia’s invasion has led to a concerning shift in messaging about corruption challenges in Ukraine. Critical assessments about the extent of corruption in Ukraine are easily dismissed as an exaggeration fueled by Russian disinformation or the result of the Kremlin’s practice of “strategic corruption.” Top officials, even President Zelensky himself, react defensively to suggestions from Euro-Atlantic partners that anti-corruption reforms should remain a priority. Exasperated Ukrainian delegations visiting Washington point to past accomplishments and ask rhetorically what more they can do to show progress.
Why Addressing Corruption Matters, Even Now
It is well known that Russia has sought to fuel corruption and amplify narratives about poor governance in Ukraine in an effort to weaken support from the international community and destabilize the country from within; the country is also, to some extent, a victim of its own success, as countries actively engaged in fighting corruption inevitably make the public more aware of the problem, paradoxically leading to heightened perceptions of corruption as compared to countries where it is swept it under the rug. However, Ukrainian officials should not dismiss concerns about corruption but engage them proactively.
The primary reason for this is that Ukraine cannot afford to alienate its partners in the West, in particular the United States. Since February 24, Congress has approved over $50 billion in security, humanitarian, and economic assistance to support Ukraine. This is a substantial sum, but further support is needed to help the Ukrainian military weather the current fighting in the Donbas. More still will be required to turn the tide of battle and roll Russia back to its February 23 positions. Meanwhile, Ukraine’s economic losses, estimated at $600 billion in early May, continue to grow as Russia targets civilian infrastructure throughout the country, and the government has indicated that it needs approximately $5 billion per month to cover essential budget expenditures. Kyiv has no other choice but to continue relying on its Western partners to sustain its defense and to keep its economy afloat.
However, economic woes in the United States and Europe—and concerns about an open-ended commitment to support a proxy war with Russia—are beginning to put a damper on the enthusiasm of some politicians to maintain the degree of support provided to Kyiv thus far. When Congress passed its latest supplemental appropriation for Ukraine, 11 Republican senators and 57 Republican representatives voted against it because of a perceived lack of oversight of these funds. Some of these members have long opposed any foreign assistance regardless of context, but there were others seem genuinely motivated by concerns related to oversight. These dynamics are not going away and, in fact, may worsen after the congressional midterm elections in November.
In this context, Ukraine has little room for error when it comes to using Western assistance as intended. As another CSIS expert recently explained, any corruption in handling the billions of U.S. taxpayer dollars “would undermine the bipartisan support that the aid has received and thereby impair the ability of the Ukrainian people to continue their struggle.”
So far, Ukraine has had no high-profile cases of corruption involving donated military equipment, budget funding, or humanitarian aid. Yet, scattered reports of bribery and theft involving state officials show that corruption risks have not zeroed out since the invasion, despite a widespread understanding that depriving the state of desperately needed resources during wartime is tantamount to treason. Considering that Ukraine may be only one or two corruption scandals away from jeopardizing the continuity of its support from the West, complacency is not an option.
Recognize the Problem, Show Achievements, and Remain Proactive
Ukraine should feel empowered to address concerns about corruption head-on, rather than deflect, dismiss, or minimize them. After all, reformers have been talking and thinking about corruption for more than eight years, and in some cases, they have created champion institutions that are fit for task. Leveraging these institutions to detect, investigate, and punish corrupt actors—even at a time of crisis—would send a strong signal to Ukraine’s partners.
With calls for increased oversight of U.S. assistance to Ukraine rising on both sides of the aisle, Ukrainian officials should work with the Biden administration to deliver clear transparency and accountability of the substantial funds received. Ukraine can help boost the confidence of policymakers by bringing its own proposals to the table and by willingly working through the systems created.
Recognizing the importance of demonstrating progress on governance reforms to the continuity of Western support, the Zelensky administration would be wise to designate anti-corruption activities as an essential function during the period of martial law and to recruit and train new experts in this area. Similarly, the staff of nongovernmental organizations conducting civic oversight functions should be considered eligible for exemptions from military service.
Ukraine should continue to make progress on expected reforms that were derailed by the invasion but were uneven during the pre-war period. For example, nominating a head of the Specialized Anti-Corruption Prosecutor’s Office, which has been vacant since August 2020, and establishing a procedure to select qualified judges for the Constitutional Court would be a strong signal of Ukraine’s intention to continue important reforms that serve as a foundation for the country’s future development. The European Council’s recent decision to grant Ukraine candidate status could provide the country’s leaders political cover to carry out these activities; five of the seven reforms that the European Commission said that Ukraine must advance in order to maintain its status touch directly upon corruption, governance, and the rule of law. Ukrainian officials should take care not to engage in loose rhetoric that could be interpreted as backpedaling the government’s commitment to implementing these important reforms.
Of course, the United States and Ukraine’s partners in Europe have an important role to play. To address congressional concerns about the possible misuse of military assistance, the Biden administration should send a high-ranking Defense Department official to Ukraine and a team of specialists to serve as a focal point for weapons delivery accountability. Although many accountability functions could be conducted from the United States or Europe, this team should have sufficient civilian personnel on the ground in Ukraine to report on how assistance is being used. Additionally, auditors at the Department of State, Department of Defense, and U.S. Agency for International Development should be resourced with the adequate funds and staffing to oversee rising levels of assistance. The $5 million provided for this purpose in the $40 billion Additional Ukraine Supplemental Appropriations Act is a start, but it is unlikely to be adequate, given the extent of the aid being provided and its overseas location. Further, a special group could be established as an ad hoc measure to facilitate coordination among inspectors general. In any event, politicians who raise concerns about a perceived lack of oversight for assistance to Ukraine should be prepared to engage with counterparts from Kyiv to elaborate what they would need to see to feel confident about additional expenditures.
To speak about corruption in Ukraine while it fights for its survival is a difficult and delicate task. Yet, as the country relies increasingly on military and macroeconomic assistance from the United States and Europe to defend itself from a Russian invasion that is transforming into a war of attrition, the ability to engage this sensitive issue is critical to the country’s national security. The United States has emerged a critical partner, but there are political forces that will look for reasons to question the wisdom of continued assistance for Ukraine. Some of this is driven by genuine concern around oversight and accountability. It is in the best interest of Ukraine to be transparent and work to mitigate these concerns, relegating the opposition to the usual anti-foreign assistance suspects.
Andrew Lohsen is a fellow in the Europe, Russia, and Eurasia Program at the Center for Strategic and International Studies (CSIS) in Washington, D.C. Conor Savoy is a senior fellow with the Project on Prosperity and Development at CSIS.
Commentary is produced by the Center for Strategic and International Studies (CSIS), a private, tax-exempt institution focusing on international public policy issues. Its research is nonpartisan and nonproprietary. CSIS does not take specific policy positions. Accordingly, all views, positions, and conclusions expressed in this publication should be understood to be solely those of the author(s).
© 2022 by the Center for Strategic and International Studies. All rights reserved.