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Ukraine: look at one’s own garden

Mikheil Saakashvili. Photo: gossip.in.ua

The logic of history suggests that it is a political utopia for Ukraine to hope to get Crimea back in near future. For this purpose, it will have either to beat Russia in a war or to wait until the Kremlin falls under the weight of its own greatness. All the rest – from the Geneva agreements of Apr 2014 to the European Parliament’s resolution of May 2016 - is just one more confirmation of Henry Lawrence Mitchell’s words that you can make any problem unsolvable if you just organize enough conferences to discuss it.

Russia can hardly be beaten or ruined in near future. They in the Kremlin are just sneering at Europe going through an immigration saga (in Copenhagen refugees are already creating “Sharia zones”) and at Donald Trump publicly flogging the U.S.  authorities. $40-50 per barrel is a not a big problem to them (of course, this is not high enough but at least this is not $25!). Their gold reserves are amounting to a comfortable level of $400bn and their sexual girls in minis during the last May 9 parade have impressed even the cool-headed British press. So, Ukraine should better stop trying to see what is going on behind its neighbor’s fence and should look at its own garden.

And there is a real mess there. The post-Maidan regime has managed to stop the federalization process, but centripetal forces continue tearing Ukraine apart: radical Muslims in Kherson, Burshtinov regime in Rivne, Volyn and Zhytomyr, Baloha clan in Zakarpattia and Andriy Sadovy’s Self-Reliance in Lviv.

The economy is degrading. Ukraine has lost not only its eastern consumers but even its own logistics. Last summer deputy CEO of Gazprom Alexander Medvedev said that in 2019 his company was going to stop pumping its gas via Ukraine, which means that all of Kiev’s gas sufferings will end in nothing. Poland and Belarus are just happy to see Ukrainian radical nationalists regularly halting cargoes moving to the east. They in Kiev are trying to find alternatives, like a Silk Road railway (Csap-Uzhhorod-Ilyichevsk-Batumi-Beyuk-Kyasik-Alat-Aqtau Port-Dostyk and China). But can a road running via five states be a match to a direct road? Of course, it can’t. No surprise that the test train sent to Dostyk a month ago has come back empty.

Even the inspirers of the Ukrainian Maidan have no more hopes concerning Ukraine’s industry: quite recently U.S. Ambassador Geoffrey Piyatt said that Ukraine is destined to become a great agricultural power. It would be lovely to have a guaranteed piece of bread with bacon but...

In developed countries, farmers constitute just 4% of the population, in developing ones, their percentage is 45%, in the least developed countries, it is 66%. So, what Piyatt is suggesting is a cynical mixed metaphor - “least developed great power.” If Ukraine gets developed, only 4% of its citizens will be farmers. So, the question is what they in Kiev will do with the rest? Below are possible answers:

-   unemployable and old people will be liquidated;

-   able-bodied citizens will be forced to emigrate;

-   the rest will be used as a bio resource for Ukraine’s most popular product in the West – Russophobia.

And why only Russophobia? There are lots of people in Ukraine who are ready to kill for money in North Africa, the Middle East and Central Asia and possible even in Venezuela and Brazil. We are not gibing. We are just drawing conclusions from what Pyatt said.

And we cannot help but wonder if Ukraine still has regions the “collective” West may be interested in. Yes, it has – Western Ukraine and Odessa Oblast.

Halichina, Bukovina and Zakarpattia are the West’s foothold in Ukraine. So, you can easily find money or partners for your business there. One of the most successful fund-raisers of Ukraine Ruslan Kraplich says that in 2010-2012 his organization, the Association of Local Government “Euroregion Karpaty-Ukraine” carried out seven big projects sponsored by the Polish Foreign Ministry, Eurasia Foundation, Telenor of Finland and other foreign donors.


In its recent article, The New York Times gave an example of such a project – production of sports equipment at a Mukacheve factory owned by Fisher Sports of Austria. But this “report of success” has two interesting points. First, Ukrainian workers are paid just one-eighth of what their colleagues in Austria get. And the second point. This is what The New York Times says: “So it is unclear how far any benefits of the trade pact might carry beyond the western edge of Ukraine near the Polish border, where most of these factories are situated.” But is it really unclear?

And now let’s see what is going on in Odessa Oblast, an enclave of Georgian rule in Ukraine. For one year already, that region has been ruled by Mikheil Saakashvili, former Georgian President, wanted by his own country. In Odessa, people regard him quite differently: some locals respect him, others mock. Today it has become clear that “Saakashvili in Odessa” was just the first stage of the “Saakashvili in Ukraine” program. But this program has stalled as during the last year’s local elections Saakashvili failed to establish full control over the region and to put his men in the key offices.

This failure has shattered his rating a bit but this genius of populism still enjoys 75.42% confidence in his region and has no real rivals. His conflict with Mayor of Odessa Gennadiy Trukhanov was just an ordinary squabble between a mayor and a governor. Trukhanov’s team has neither money nor strengths for a real war against Saakashvili, especially as local police chief Giorgi Lortkipanidze is Saakashvili’s man.

Today Saakashvili’s team controls all financial flows in Odessa Oblast. In fact, they have done the thing well-known satirist from Odessa Mikhail Zhvanetsky has always dreamed of: “to rent two meters of state border.” The de jure chief of the regional customs office is 27-year-old beauty from Saakashvili’s harem, Yulia Marushevska, while de facto it is managed by Georgian professionals, former income minister of Georgia Georgy Tskhaya and former chief of a customs-related service Mamuka Tuguchi.

Saakashvili is also confident in terms of security: his region now controls the navy withdrawn from Crimea. This force is not big but this is not a problem. We already have examples of how one can enlarge his Black Sea fleet despite any Montreux conventions by just leasing ships: in 1914 the Turks leased two German ships and used them against Russia during the WWI.

One more scenario is a NATO sea base in Odessa. This would be a kind of compensation for the loss of Crimea. Formally, there are all prerequisites for this: in Dec 2014 the Supreme Rada revoked the law about Ukraine’s non-bloc status. So, there are no more obstacles to a foreign sea base in the region. One thing is clear: whatever happens, the Americans and their proxies will keep Odessa till the end. This is why Saakashvili is so relaxed.

He has nothing to be afraid of. But there is a big threat coming from his former ally, Petro Poroshenko. The Ukrainian President has already gotten rid of his key rival, Arseniy Yatsenyuk and Saakashvili may be the next. In fact, this process has already started as some of Saakashvili’s men have already been dismissed.

But Saakashvili is not losing his confidence and continues ruling his province – though this rule has given little if nothing to the ruled.

Just two examples. Recently U.S. Ambassador Geoffrey Pyatt said that Ukraine is destined to grow into an “agrarian great power.” But for two years already the project to build a grain terminal in the port of Ilyichevsk has been pending its start.

The second example: one of the key guarantees of Odessa’s security is the project to build a highway to Reni (a road to Danube ports). Besides being a big benefit for the province of Budjak, this road is expected to become a crossroads for cargoes flowing from the Black Sea region to Central Europe. China is very much interested in this route as this may become part of its New Silk Road. A delegation of Shandong (a Chinese province with a GDP of $965bn – equivalent to seven Ukrainian GDPs!) visited Ukraine in 2010 to negotiate this project but the talks failed as the Ukrainians rejected the partners’ terms: only Chinese products, 90% of Chinese workers and long-term rent of both sides of the road.

In 2011, the Odessa authorities convinced the Kiev Government to approve the project to build a road from Odessa to Monashe and a bridge over Dniester Lagoon.

But nothing has happened since then even though Saakashvili keeps talking about the road and the funds raised for it. In mid-March he said that they already had 1,000,000,070 UAH. In April they had 1,100,000,000 UAH. But in May Saakashvili met with Anton Kisse, MP and the leader of Bessarabian Bulgarians, and said that they had half a billion for the road.

This play with figures may mean that Saakashvili has no money at all. And even if he has, the estimated cost of the Odessa-Reni road was 2.5bn-3bn USD – not hryvnas, not even yuans, but U.S. dollars.

This all means that Saakashvili is not planning to build any road. Hence, Ukraine is falling out of the fight for cargo flows in Southeastern Europe. In the meantime, the Europeans are actively building Via Carpathia – a road supposed to connect the ports of the Baltic and Black seas – but Ukraine is not in the project.

Romania is no less active in its efforts to move cargo flows via its section of the Danube delta. And this is not hard to do as there are no normal roads connecting Odessa with the Danube ports of Reni, Ismail and Kilia.

So, our conclusion is very sad: one of the most promising Ukrainian regions, Odessa, has no real economic, industrial or at least agrarian projects. So, since Ukraine does not want to trade in products, it has just one product to offer to its European partners – Russophobia and a NATO sea base in Odessa.

Andrey Ganzha, specially for EADaily

Permalink: eadaily.com/en/news/2016/05/19/ukraine-look-at-ones-own-garden
Published on May 19th, 2016 02:20 PM
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