This report makes the case for increased Western support, and argues the EU has been too timid in applying its unprecedented political mandate to drive forward post-2014 reforms in the country.
The report, which includes policy recommendations, assesses Ukraine’s position and prospects, and examines its double existential threat: resisting Russian interference, and the fierce internal contest to determine its own political, institutional and civic future.
It states it is an illusion to believe diplomatic formulas alone will diminish Russia’s determination to dominate Ukraine, suggesting the West must work inside and outside international negotiation frameworks, the Normandy Format and Minsk process, to resolve the war between Ukraine and Russia and strengthen European security.
The West should provide increased defence assistance and training; funding for the modernization of the Kyiv-controlled parts of Donbas and NATO advisory programmes in the security and law enforcement sectors, it says.
The report covers six critical areas: geopolitics and security in the context of the conflict with Russia; European integration and the demands of the Association Agreement; economic reform; governance, democratization and the media; the role of civil society in reforms; and efforts to combat corruption.
Summary of findings and policy recommendations:
Arguably the greatest danger to Ukraine comes from within. Ukraine’s establishment, its informal networks, its Soviet legacy and, most of all, vested interests in the form of businessmen with excessive influence on the levers of power pose the greatest threat to stability and success.
It is an illusion to believe diplomatic formulas alone will diminish Russia’s determination to dominate Ukraine and rid it of meaningful Western influence. Russia’s calculations will change only when its most influential figures perceive that a continuation of the present course is no longer feasible.
There is no contradiction between dialogue and defence. The West must work inside and outside the Normandy Format and Minsk process to resolve the war between Ukraine and Russia and strengthen European security.
The West’s sanctions against Russia should be periodically reviewed, strengthened where necessary, and kept in place however long the illegal annexation of the Crimean peninsula lasts and destabilization of the east of the country continues.
NATO and the EU should, respectively, launch security sector and law enforcement advisory programmes in Ukraine commensurate with NATO’s existing efforts in the defence sphere.
If Western countries remain committed to supporting Ukraine, both bilaterally and multilaterally through the G7 and the EU, Russian strategy towards the country can be checked to a significant extent. A Western policy of benign neglect or, worse, accommodation with Moscow at Ukraine’s expense would seriously destabilize the country.
The establishment of an effective, trusted and accountable state is a primary national interest.
Unless law enforcement, security and defence institutions are fit for purpose, Ukraine will remain dangerously vulnerable to infowar, penetration, sabotage and destabilization.
The EU has an unprecedented political mandate for driving reforms forward. However, it has been too timid to use this mandate, and risks losing the trust of reformers.
The Euromaidan revolution and the conclusion of the EU’s landmark Association Agreement, signed in 2014, and ratified in 2017, offer the promise of a sea-change in Ukraine’s relations with Europe.
The EU must maintain strong conditionality in the long term to stimulate real, rather than partial or cosmetic, reforms.Its support should move away from classic, pre-scripted technical assistance projects – the effectiveness of which are very low – to tailored, more flexible and longer-term programmes of at least four to five years in duration.
Economic and political reform
Judicial reform remains the Achilles heel of the anti-corruption effort as a whole. Progress on the rule of law and an independent judiciary are the ultimate test of Ukraine’s reforms.
There must be continued pressure for progress towards zero tolerance of corruption at all levels. The establishment of a special trial court or chamber free from political interference is essential for further progress in the battle against corruption and the development of a new legal culture. The appeal system must be similarly independent.
Civil society and the international community should place as much stress on electoral and institutional reform as on anti-corruption measures, to encourage a break with the old system and allow a new generation of genuine reformers to shape laws and policies.
Land reform is badly needed to ensure that Ukraine’s large but low-productivity agricultural sector is a powerhouse for longer-term economic growth. There are indications that the Ukrainian government will partially lift a moratorium on land sales by the end of 2017. Reform should also include the sale of over 10 million state-owned hectares of agricultural land, which could potentially raise big sums for the state budget.
Further reform of Ukraine’s more than 3,000 state-owned enterprises is essential.
Of all the areas in which Ukraine needs reform, economic policy is one of the most critical. With the country’s macroeconomic and financial resilience apparently improved, the next challenge is to improve the business environment, unlock the potential of the land market and support investment to deliver much-needed economic growth.