Ukraine: a question of survival - political and economic crisis; U.S. policy towards Ukraine

TWO YEARS AFTER its rebirth as an independent state, Ukraine is struggling to survive. The economy is in shambles; Crimea is a political tinderbox; given the results of the parliamentary elections in the Spring of 1994, the prospects for effective government remain uncertain; and Moscow's intentions toward Kiev, at best, are unclear. The very existence of Ukraine is in jeopardy.

In the West, assessments of Ukraine's prospects range from outright pessimism--notably embodied in a recent CIA National Intelligence Estimate which apparently forecasts that economic failure is likely to result in the splintering of eastern from western Ukraine--to more hopeful assessments of Kiev's political prospects, predicated upon optimistic readings of Ukrainian public opinion and the fact that no oblast in eastern Ukraine has a Russian majority.

There is less disagreement about the geopolitical and military consequences should Ukraine experience political collapse. Most analysts agree that this would probably entail both a civil war and a Russian-Ukrainian military clash. Indeed, many believe along with Karen Elliot House that "the major security threat to Europe in the near term will be Russia's attempts to reabsorb Ukraine," and that this could result in violence that will dwarf the Yugoslav conflict. Moreover, a collapse of the Ukrainian state would almost certainly mean the end of Russia's democratic experiment and a reversion to imperialism, with dire ramifications for Western security. In Zbigniew Brzezinski's apt characterization, "Russia can either be an empire or a democracy, but it cannot be both."

Averting the worst-case outcome in Ukraine will require judicious collaboration among all the major stakeholders: the Ukrainian government and opposition or reformist forces; the Russian government and diverse Russian political and bureaucratic players; and, last, but not least, Western governments. To be sure, both the primary responsibility for Kiev's future and the opportunity to shape it lie with the Ukrainian government and people; actions of other parties, at most, can make Ukrainian success more or less likely.

Different Interests, Different Perspectives

ON THE BANKS of the Dnieper River in Kiev stands a statue of the city's founders--Kiy, Shchek, Khoriv and their sister, Lybid. It is a reminder of the birth of a city and the growth of a nation at the vital strategic and commercial crossroads of Eurasia. Yet the statue itself and the history it symbolizes hold different meanings for Ukrainians and Russians.

Most Ukrainians view the past as a story of repeated brutal efforts to subjugate their country, primarily on the part of Russia, but also involving Poland, Austria-Hungary and Ottoman Turkey. In this view of things, Ukraine's history has been a record of betrayals, exploitations, suffering and partitions--a process of victimization that was relieved only by two very brief periods of genuine independence: the Zaporizhian Sitch (1648-1654), when the Zaporizhian Cossacks were governed by an elected leader, Hetman Bogdan Khmelnitsky; and 1918-1920, while the Russians were engaged in a civil war of their own. Kiev besieged on many occasions by barbarians, Westerners, and fellow Slavs--is a proud symbol of Ukraine's determination to survive and prevail.

Unfortunately, this vision is not generally shared by Russians, most of whom recall with pride the Kievan Rus' period, when Kiev, long before Moscow rose to prominence, supposedly functioned as one of the great Russian cities, alongside Pskov, Novgorod, Suzdal and Vladimir. Russians genuinely believe that, the commonly suffered privations of communism aside, throughout most of its history their country has behaved altruistically toward fellow Slavs in general and Ukrainians in particular. For example, for generations Russian textbooks have depicted the 1654 Treaty of Pereyslavskaya Rada, which secured the incorporation of Ukraine into the Russian empire, as a glorious event that freed Ukraine from Ottoman and Polish oppression. Since Kiev is one of the oldest Slavic cities, Ukrainian independence is today a jarring reminder of the collapse of imperial Russia.

As well as being a psychological defeat, the loss of Ukraine has been a serious blow to Russia's economy and has greatly diminished Russia's geopolitical clout--something well-anticipated by Lenin who once remarked that "if we lose Ukraine, we lose our head." Given that premise, it is not surprising that in 1918 the Lenin-led government moved to repudiate the Treaty of Brest-Litovsk and recapture Ukraine as soon as Germany was sufficiently weakened to allow it to.

Russia still has not reconciled itself to Ukrainian independence, viewing it as a temporary aberration. Polls show that the majority of both the Russian population at large and of democratic politicians see it as a tragic mistake to be corrected. All Russian leaders understand that, for a variety of geopolitical, economic, and even psychological reasons, the existence of an independent and strong Ukraine will greatly limit their options. Consequently, the Russian government has proved perfectly willing to exacerbate and exploit Ukrainian economic problems, while publicly lambasting the Kravchuk government over such sensitive issues as the handling of Ukrainian nuclear weapons, the Black Sea fleet, treatment of Russians in Ukraine and the status of Crimea. Russia's adoption of a muscular foreign and defense policy in the "near abroad," a policy now embraced by Russia's entire political spectrum, from Vladimir Zhirinovsky to Foreign Minister Andrei Kozyrev, further complicates Russian-Ukrainian relations. Ukrainian independence will curb Moscow's ambitions to exert a strong influence not only on developments in the former Soviet Union but on Central and East European developments.

A Troubled Axis

GIVEN THEIR divergent strategic premises, it is not surprising that Kiev and Moscow see the Commonwealth of Independent States (CIS) in a very different light. For Ukraine, it is a temporary arrangement of convenience, primarily designed to facilitate a civilized divorce between Russia and Ukraine. For Moscow, the CIS is a more or less permanent institution, intended to facilitate a painless political transition toward a "union" and legitimize Russian economic, political, and even military dominance over the countries of the former Soviet Union. The Russians are quite candid about their aspirations in general, and the relationship between the political and economic dimensions of the CIS membership status in particular. Thus, for example, the comment by Russian Deputy Prime Minister Aleksandr Shokhin that membership in the CIS economic union would entail a partial loss of both economic and political sovereignty, and the conviction expressed by Yeltsin's press secretary that economic union would "inevitably and logically" be followed by political union.(1)

That Russia does not expect Ukraine to survive and would like to reincorporate it, does not, of course, mean that Moscow is prepared to go to war over the issue or even to run an inordinate risk of an armed conflict. With the exception of a few hardliners like Zhirinovsky and Rutskoi, Russia's political mainstream is content with waiting for Ukraine to fall into its hands; it is also comfortable with eschewing the formal imperial trappings and conceding the semblance of sovereignty to Ukraine, while settling for real hegemony.

To date, the Russian government has been extremely cautious in its behavior. Unless a fundamental political realignment in Russia takes place or massive internal unrest breaks out in Ukraine, it is likely to remain so. At the same time, one cannot exclude the possibility of an unplanned confrontation. Events in Georgia, Azerbaijan, the Baltics, and particularly Moldova demonstrate that Yeltsin's government and the Moscow-based Ministry of Defense do not fully control the Russian military. (Indeed, for several years now, Russia's 14th Army in Moldova has functioned as a rogue force, controlled entirely by its commander, Lieutenant General Aleksandr Lebed.) In the case of Ukraine, it is possible to envision a confrontation instigated by the Black Sea officers that would draw in both the Ukrainian units stationed in Crimea and rogue Russian troops from the Dniester Republic and the Caucusus.

Crimea poses a special challenge. The strong and intense feelings it arouses in both Moscow and Kiev are best characterized by Vladimir Zhirinovsky's assertion that "Kuwait is to Iraq, what Crimea is to Russia"--and Ukrainian Deputy Foreign Minister Borys Tarasiuk's ominous promise that if "Russia takes Crimea, Ukraine will remain nuclear."

The peninsula was transferred to Ukraine from the Russian federation by Khrushchev in 1954. Ironically, the purpose of the gift was to commemorate the 300th anniversary of Ukraine's reunification with Russia. Crimea's 2.5 million inhabitants are 67 percent Russian, 26 percent Ukrainian, and 10 percent Tatar. Approximately one-third of the population is made up of active duty troops and military retirees, who are generally pro-Russian. On the other hand, the Tatars, who suffered greatly following Stalin's genocidal decision to ship them all to Siberia, clearly view Ukrainian rule as the lesser of two evils.

While the majority of Crimeans originally voted for Ukrainian independence, these days sentiments seem to run toward autonomy within a loose Kiev-based federative structure, if not yet outright independence from Ukraine. In the Crimean presidential elections of January 1994, the pro-Ukraine candidate, Mykola Bagrov, was trounced by the pro-Russian Yuriy Meshkov. On March 27, elections for Crimea's parliament were held concurrently with Ukraine's national parliamentary elections. With the pro-Meshkov and separatist Rossiya Bloc winning 67 percent of the vote (64 of the Crimean parliament's 98 seats), the outcome further consolidated President Meshkov's political control. However, as Myron Wasylyk and Ian Brzezinski have pointed out, "Although Meshkov's control over the Crimean parliament has been strengthened, his political standing in Crimea has shown signs of weakness. Despite [his strong appeals] to boycott the Ukrainian national parliamentary elections, 61 percent of Crimea's population participated." More important, perhaps, is the fact that the Crimean referendum, carried out as an "opinion poll" after Kiev proscribed a full-fledged referendum and taken during the March parliamentary elections, indicated that 74.8 percent agreed that Crimea should have greater autonomy from Kiev; 82 percent supported dual Russian-Ukrainian citizenship; and 77.9 percent endorsed giving presidential decrees the force of law.(2)

The dilemma facing Kiev today is how to prevent Meshkov from going too far without provoking massive bloodshed, and thus Russian intervention. An unduly harsh Ukrainian policy of economic blockade -- Crimea receives 80 percent of its foodstuffs from Ukraine--would almost certainly be counterproductive. On the other hand, an excessively accomodationist policy---such as allowing Meshkov to secure full Crimean autonomy within a federal structure--might also backfire, by encouraging Crimean leaders to seek more and more concessions from Kiev. Since many former senior CPSU officials--and most Ukrainian leaders fit this description--feel that it was Gorbachev's excessively accomodationist policies toward the Balts, Georgians and ultimately, the Ukrainians that led to the splintering of the USSR, the Kiev-based government clearly wants to avoid a similar experience with Crimea.

The Military: Good and Bad News

CREDIBLE MILITARY capabilities and sound military doctrine for employing them in both war and peace are critical to the survival of an independent Ukraine. Thus far, the record of Ukrainian military policy has been mixed. The Kiev-based government got off to a good start, moving decisively to seize control over former Soviet troops and military installations on its territory, promptly administering loyalty oaths to all soldiers and officers, and returning to Russia those who refused. In the end, some 10,000 officers out of approximately 300,000 were dismissed, either because they refused to take the oath or because there were other questions about their loyalty. While most of the remaining officers are ethnic Russian or strongly Russified Ukrainians, and nearly all conscripts are Ukrainians, the situation differs from that in some other ex-Soviet countries in that ethnic tensions in the military seem to be largely absent or under control.

Ukraine was also fortunate in having a very able military officer, General Konstantin Morozov, as its first defense minister. Under his guidance early on, the Ukrainian Rada (Parliament) articulated a politically compelling version of a military doctrine, which asserts the country's non-aligned status, the independence from political interference of Ukraine's military, and peaceful relations with neighbors. Ukraine also has used its military in peacekeeping operations, exerting a positive influence in the Bosnia conflict.

So much for the good news. Unfortunately, the Ukrainian leadership has proved unable to establish effective civilian control, or even centralized control, over its military assets. The situation is characterized not so much by insubordination as by a lack of experienced and knowledgeable staff officers who can exercise effective leadership. The problem is exacerbated by the fact that in the former Soviet Union all military assets were tightly controlled from Moscow, so that there is relatively little Ukrainian experience of managing forces above the military district level. Thus, local military leaders enjoy considerable autonomy. Additionally, very little exists in the way of a national military strategy, defense planning, defense budgeting or field exercises. Instead, the Ukrainian military has muddled through, maintaining--as best it can in deteriorating economic conditions--the Soviet era equipment and infrastructure it has inherited.

While it is hard to blame the military alone, the state of Ukrainian thinking on nuclear weapons is particularly disquieting. It seems that the military has failed to think through the consequences of Ukraine's continued possession of nuclear weapons: This is a germane issue since even under the January 1994 Tripartite Agreement Kiev would retain some nuclear weapons for years to come. Kiev's high command also neglected either to analyze how to generate optimum deterrence quality from their nuclear arsenal for however long they have it, or to consider how to maximize Kiev's security once Ukrainian denuclearization takes place, by building credible and cost-effective conventional defenses. This state of affairs has harmed both the Ukrainian defense posture and its international reputation.

By proffering numerous assurances that it intended promptly to become a non-nuclear state and then repudiating them or simply not implementing those assurances, Ukraine has created an impression that it is an unreliable diplomatic partner. Ironically, had Kiev originally insisted it wanted to retain a modest ICBM force, while agreeing to dismantle promptly all START-accountable weapons and implementing numerous Confidence Building Measures (e.g., taking its forces off alert status), it probably would have succeeded in gaining a measure of international approval, though certainly not Moscow's acquiescence. Indeed, had the Ukrainian government employed the vernacular of "finite deterrence," it would have made it more difficult for Western governments to criticize it.

By now, of course, these options are no longer viable. While failure in this respect is primarily attributable to Kiev's civilian leadership, the Ukrainian military did not attempt to ascertain how long it would take them to develop a high-quality conventional defense posture and whether, if an indefinite possession of nuclear weapons was politically unfeasible, Kiev could at least retain them for an interim period. Thus, in the end, Ukraine got the worst of all possible worlds--it has paid a heavy political price for retaining nuclear weapons, and has played into the hands of Moscow's anti-Ukrainian propaganda, without deriving much, if any, additional deterrent quality from its nuclear posture.

One of the most serious and divisive military disagreements between Ukraine and Russia is over control of the 300 vessel-strong Black Sea fleet. At least four attempted divisions of the fleet assets and on-shore installations have taken place over the last two years, without quelling the underlying tensions. The most recent accord was signed in Moscow on April 15 by Presidents Yeltsin and Kravchuk. The deal assigned some 20 percent of the fleet's assets to Kiev, with the rest going to Russia. Ukrainian and Russian fleets would now be stationed separately. Almost immediately, however, the defense ministers of the two countries began to dispute the agreement's key terms. The recent flight of a Sevastopol-based naval research/support vessel to Russia, with Ukrainian forces chasing it across the Black Sea, demonstrated dramatically the dangerous fact that Ukraine does not have the full loyalty of most of the naval officers.

The Missing Economic Reform

ALTHOUGH THE intricate Russian-Ukrainian minuet over security-related issues has preoccupied Kiev, Moscow and Western capitals, the crisis of the Ukrainian economy also has important geopolitical implications. The absence of economic reform and resulting domestic developments serve as a magnet for Moscow's meddling and manipulation. At worst, they may provide Russia with an excuse for military intervention; at best, they furnish leverage for Moscow in its dealings with Ukraine.

Ukraine's economy continues to deteriorate. Indeed, while most countries of the former Soviet Union have ailing economies, Ukraine's economic decline has been the worst of all. Though in recent months inflation rates have fallen, double-digit rates were rampant in 1993. The Ukrainian currency has lost nearly all value. Industrial production has fallen 60 percent since last year and they are printing 25 percent more money than in January-February 1993. Nor is there any sign of improvement on the horizon. In the apt characterization of Viktor M. Pynzenyk, the former Ukrainian Deputy Prime Minister and Minister of Economics, the Kravchuk government approach to economic reform has been one of "shock without therapy."

Several factors have contributed to this sorry state of affairs. Ukrainians inherited a bad situation. The Soviet economy as a whole had been going downhill throughout the 1980s, and in the latter part of the decade decline had been sharp. Another key Soviet legacy was the extreme interdependence between Ukrainian-based enterprises and factories spread throughout the former Soviet Union. Cutting this umbilical cord has proven to be extremely difficult. Meanwhile, the Ukrainian energy sector has been heavily dependent on Russia's oil and gas shipments, its nuclear fuel supplies, and its willingness to receive spent fuel rods and other nuclear waste. Ukrainian factories are long accustomed to subsidized energy supplies. Politically, it has been difficult for Kravchuk and his Kiev-based colleagues to move against powerful regional economic interests, especially in Russian-speaking eastern Ukraine which has traditionally enjoyed a close relationship with the neighboring Russian provinces. To add to all this, Russia has proved perfectly willing to resort to economic blackmail, by raising manifold the prices Ukraine is supposed to pay for oil and gas, while continuing to insist on the old pricing structures for Ukraine's agricultural and industrial products.

Kravchuk's government is not free from blame for the mess. Heavily dominated by former party apparatchiks and economic managers, it has failed to craft and implement a comprehensive economic reform program. Indeed, it has neither arrested the decline of the traditional command-and-control economy, nor replaced it with anything more market-driven.

The economic crisis has seriously undermined the popularity of the government. A poll conducted by the Democratic Initiatives Center shows that a majority of Ukraine's population believes that the economy is in a critical or even catastrophic state, and about 84 percent blame the government. That the economic crisis has contributed to growing regionalism and polarization is clear from the preliminary composition and orientation of the new Rada. The center-right Ukraina Democratic Coalition, predominantly Kiev- and western-based, favors Ukraine's integration into European economic structures and the maintenance of a unitary state; the center-left Interregional Bloc for Reforms, mostly based in south and eastern Ukraine, advocates Ukraine's full entry into the CIS' economic union and supports a federal restructuring. The results of the referenda held in both eastern Ukraine (on integration in the CIS economic union) and in Crimea (on autonomy from Kiev) flow largely from the population's discontent with current economic conditions and the Ukrainian leadership's inaction.

Whether ethnic, religious and political divisions can be controlled depends in large part on the economy. The vast majority of Ukrainian citizens, irrespective of their ethnic, geographical, religious or political affiliations, appear to be primarily interested in better living standards, and are willing to give the government some breathing space in which to launch economic reforms. As is most vividly demonstrated by the high voter turnout (75 percent) in the recent parliamentary elections, they want government to address and succeed in resolving the problems that have plagued Ukraine's sovereignty. Economic failure will not only inflame social divisions; if it reaches a level that results in serious civil unrest, it will make Russian intervention more likely.

The Outlook from Washington

UKRAINE IS geostrategically important to the United States for three reasons. First, it provides a large and effective buffer zone--one the size of France--between Russia and much of Central Europe. Should it once again fall under Russian rule of whatever variety and cease to perform that function, the political atmosphere of Central Europe would alter radically and for the worse. The problems for America in the region would magnify as its old superpower rival again became a major stakeholder--or at least a perceived threat--there.

Second, the collapse into chaos and internal violence of a country the size and importance of Ukraine would worsen the prospects of stability and democracy in Russia and other adjacent countries. Given the long common border, the likelihood that the disorder would spread into Russia would be high.

Third, Ukraine is at present the third largest nuclear power in the world. It is also the most troubled possessor of those weapons in significant numbers. Insofar as the United States is serious about handling the problem of nuclear proliferation, Ukraine must figure prominently in its calculations.

For a combination of these reasons, the United States is obliged to formulate a coherent and effective policy towards Ukraine. So far it has not done so. Until fairly recently, U.S. policy toward Ukraine was driven almost entirely by the third of the considerations listed. Its imperative was how best to pressure Ukraine into prompt ratification of the START I Treaty, with the dismantling of all remaining Ukrainian nuclear weapons and an accession to the Nonproliferation Treaty soon to follow. Indeed, since the Clinton administration seemed intent on giving Moscow a pre-eminent place among all post-communist countries of the former Soviet Union, the future of U.S.-Ukrainian relations looked rather bleak. Fortunately, a change towards a more balanced approach seems to have taken place in the last several months.

To begin with, the administration appears to be cautiously reassessing its Moscow-only policy and seems interested in a more active pursuit of dose ties with several non-Russian states, including Ukraine. While the U.S. needs to continue a careful and sensitive policy in the nuclear area, one designed to secure Ukrainian adherence to the tripartite agreement on nuclear forces, it also needs to help Kiev deal both with its internal problems and with any possible Russian noncompliant behavior. Serious consideration should be given to allowing Kiev at least a seven to ten year grace period in implementing the Nuclear Nonproliferation Treaty. Such a delay should help accomplish two important goals. First, it would help provide some modicum of deterrence for Ukraine while it sets its house in order and while it is still very vulnerable to Russian pressure. Second, this nuclear interregnum would give Kiev time to develop and construct a creditable conventional defense posture, something that it has failed to do thus far.

Meanwhile, with the recent U.S.-brokered compromise over the nuclear issue bilateral relations have been broadened. As a result of President Kravchuk's visit to the United States on March 4, U.S.-Ukrainian economic ties have been expanded. For example, a Joint Commission on Trade and Investment has been established to lower trade barriers and promote investment; $50 million in additional Overseas Private Investment Corporation (OPIC) funding has been made available for investment projects in Ukraine in FY 1994; and the benefits of the U.S. Generalized System of Preferences was extended to Ukraine, providing Kiev with duty-free access into the U.S. market for some 4,400 products. Other areas of heightened bilateral cooperation include: science and technology, agriculture, defense conversion, culture and energy. Washington also is now prepared to dispense sizable amounts of economic aid to Ukraine, totaling roughly $700 million in FY 1994 and FY 1995.

We should encourage Ukraine to craft and implement a comprehensive economic reform program and provide any relevant technical assistance. And the United States, which has already acted as an engaged and scrupulously fair broker in negotiations between Moscow and Kiev over nuclear weapons, should expand this approach to include other contentious Russia-Ukraine issues--for example, the pricing and payment for Russian oil and gas deliveries.

The U.S. also needs to support Ukraine's efforts to anchor itself firmly within the western security and economic architecture. Initially, given the administration's recent decision to eschew formal broadening of NATO, and to opt instead for the Partnership for Peace (PFP) approach, Washington should strive to imbue PFP, with some substantive content in the form of both staff and field exercises, involving NATO troops and troops from Ukraine, Poland, the Czech Republic, and Slovakia. While large-scale military assistance programs would be controversial at this time, there is a variety of low key ways to help Kiev with training, equipment maintenance and modernization, as well as the development of doctrinal concepts and force planning. We can also encourage Central European democracies to cooperate more with Ukraine in the military sphere.

Ultimately, serious consideration should be given to moving beyond the PFP and admitting Ukraine and other Central European countries into NATO. If skillfully pursued, this policy would not cause an open rupture in NATO's relations with Russia, but would enhance the alliance's vitality in the post-Cold War era, while providing an important hedge against Russia's drift towards a neo-imperial, anti-Western posture. Other ways of enhancing Ukrainian legitimacy and international standing include helping them to become more involved with such regional and international organizations as the Conference on Security and Cooperation in Europe (CSCE) and the UN. We should also encourage Kiev's continued participation in peacekeeping operations, similar to its involvement in Bosnia and other UN-sponsored ventures.

For this reason, we should strongly support the development of democratic and free market structures. The creation of a civil society and the establishment of rule of law are imperative to Ukraine's independence. Programs for political party development, internships at American newspapers or TV stations, exchanges of young scholars or parliamentarians, educational fellowships at American law schools, TV debates--programs like these have a multiplier effect on encouraging Ukraine's democratic growth.

The situation is critical, but not hopeless. Kiev can ensure the sovereignty and even the prosperity of Ukraine, if it adopts a strategic vision capable of inspiring the nation. That vision must be of a Ukraine which is a key Central European nation and an important stakeholder in Western economic and security systems, and at the same time enjoys a constructive relationship with Russia. To realize this vision, the Ukrainian leadership must devise a comprehensive economic reform package and attract foreign investment; undertake legal and electoral changes that will break the near monopoly on power at the local and regional levels of the old nomenklatura, while enhancing the legitimacy of Ukrainian democrats; and pursue firm but sensitive Ukrainization policies that foster national identity without promoting ethnic and religious schisms. With the right set of policies, informed by a sound vision, Ukraine can not only survive but flourish.

An intelligent U.S. policy could bolster these prospects. The United States must continue to make it clear, publicly and privately, the importance we attach to Ukraine being not only a prosperous democracy but a sovereign and independent state with inviolable borders. But ultimately, the fate of Ukrainian independence will be decided in Kiev.

1 Roman Solchanyk, "Ukraine: A Year of Crisis," RFE/RL Research Report, Vol. 3, no. 1, Jan. 7, 1994 p. 40.

2 Myron Wasylyk and Ian Brzezinski, "Update on Ukraine," No. 14, April 15, 1994 pp. 3-4.

Paula J. Dobriansky was director for European and Soviet Affairs at the National Security Council during the Reagan Administration. An adjunct fellow at the Hudson Institute, she is currently senior international affairs and trade adviser to Hunton and Williams in Washington, DC.

COPYRIGHT 1994 The National Interest, Inc.
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