How much power do the Ukrainian oligarchs still have?

Russia Ukraine News

On a visit to Brussels on February 9, President Volodimir Zelensky said that negotiations for Ukraine’s accession to the EU would begin this year. The European Union (EU) stresses that Ukraine’s path to membership will depend on carrying out reforms and fighting corruption. In addition, he argues that the influence of the oligarchs in Ukrainian politics should be reduced. In that direction, he points to the “anti-oligarch law”, which is being examined by a commission of the Council of Europe.

The “anti-oligarch law”

According to the law, in Ukraine those who meet three of these four criteria are considered oligarchs: possessing a fortune greater than the equivalent of about 80 million dollars, exercising political influence, controlling the media or having a monopoly in some economic field. Whoever appears in the register of oligarchs cannot finance political parties or participate in large privatizations and must present a special declaration of income.

Until now, Ukrainian politics found itself in a vicious circle of corruption. Oligarchs financed political parties to influence legislation or regulations that would allow them to maximize their profits, often covertly.

But in the meantime, the “anti-oligarch law” is already showing its effects. For example, the millionaire Rinat Akhmetov was the first to hand over the licenses for his media group. Also the leader of the European Solidarity party, former President Petro Poroshenko, officially lost control of his television station, and millionaire Vadim Novinsky resigned his parliamentary seat.

Former Ukrainian President Petro Poroshenko.

Great economic losses

The destruction of Ukrainian industry in the course of the war diminished the fortunes of the oligarchs. In a study published at the end of 2022, the Kyiv Center for Economic Strategy (CES) put the oligarchs’ losses in industrial stocks at $4.5 billion. Akhmetov was the most affected. With the Russian conquest of Mariupol, his Metinvest holding company lost the Azov steel mill and another company.

Experts from Forbes Ukraine magazine estimate that the losses caused to Akhmetov by the war exceed 9,000 million dollars. However, he continues to top the list of the richest Ukrainians, with a fortune of 4,000 million dollars.

Íhor Kolomoisk’s fortune has also been greatly reduced. His main business, the Kremenchuk oil refinery, was destroyed last year by Russian attacks. The CES calculates that the losses exceed 400 million dollars. Meanwhile, this oligarch, who also has an Israeli and a Cypriot passport, lost his Ukrainian citizenship, because in Ukraine you can only have one. Proceedings have also been opened against him for alleged fraud.

Definitive loss of influence?

The oligarchs have lost considerable resources in order to influence Ukrainian politics, according to Dmitro Horjunov, an expert at the CES. But he does not have many illusions. “As long as they have a fortune, they will do everything possible to defend it or multiply it,” he says.

ESC experts hope that in the framework of European integration, large investors from the EU will come to Ukraine after the war instead of oligarchs. At the same time, they are demanding that international financial institutions, on which Ukraine is extremely dependent, condition assistance to Kyiv on progress in “de-oligarchy” and support companies that would compete with the oligarchs.