Western policy regarding Ukraine runs on autopilot. Given the dearth of leadership in the West to promote democratic values and back up the commitment with savvy and steel, it’s no surprise. This course is not helping Ukraine get better or the West to promote its values.
Quite simply, the West is too weak and uninterested in confronting the world’s war criminals and tyrants — Vladimir Putin, Xi Jinping, Mohammad bin Salman, Bashar al-Assad and Alexander Lukashenko.
Let’s bring it closer to home.
The bureaucracies of the European Union, the European Bank for Reconstruction and Development, the European Investment Bank and the International Monetary Fund are set up to dispense money — credits or loans, usually to the government or well-connected business insiders. The embassies of each country have their own budgets and priorities. All operate in their separate silos. Every three or four years, they change leadership.
Such an uncoordinated strategy harms Ukraine and Western taxpayers, who keep throwing good money after bad.
Case in point: The European Union this month approved 600 million euros in unconditional macro-financial assistance to Ukraine. By attaching no conditions, the EU guarantees that Ukrainian officials will get the wrong message: that they need to do nothing on reform or corruption.
This is a waste of time, money and effort.
“They took the humanist path,” wrote Sergey Fursa of Dragon Capital.
“And they gave Ukrainian authorities the opportunity to dodge, weave and pretend to act. Everyone says ‘we are for reforms’ while oligarchs continue to control lawmakers, ensuring the absence of any changes.”
From Oleksandr Paraschiy of Concorde Capital: It shows the government that “you can fulfill far from every condition, just show that you really need
the money and ask very nicely.”
The International Monetary Fund is barreling down the same path. The IMF has long been Ukraine’s financial drug of choice and enabler when it comes to cheap loans in exchange for half-hearted reforms — or flat-out hypocritical lies — that don’t change anything for the better.
Currently, the IMF has approved $5 billion in lending, but dispersed only $2.1 billion, partly because of setbacks in reforms triggered by Constitutional Court rulings attacking anti-corruption laws and institutions.
The IMF has rightly insisted on effective anti-corruption agencies, such as the independence of the National Anti-Corruption Bureau of Ukraine, and the restoration of penalties for state officials who lie about their income and assets on public declarations.
But this will be all for naught if, two years down the line, the same Constitutional Court invalidates the new laws that parliament passed because the same corrupt court invalidated the previous ones. The IMF is the same institution that lent money to Ukraine without requiring the nation to have any effective police, prosecutors or courts — or basic banking regulations — such as who owns what bank. This negligence allowed a $20 billion theft from Ukrainian taxpayers, engineered by banking insiders, forcing Ukraine’s government to borrow more billions to cover the billions stolen, saddling future generations with needless debt.
If the collective West wants to help Ukraine, it should collectively get its act together.
