The resignation of Ukraine’s Minister of Economy

On 3 February Ukraine’s minister of trade and economic development, Aivaras Abromavičius, submitted his resignation. His stated reason for doing so was his refusal to endorse the corruption in the President’s inner circle, and in particular, his conflict with Ihor Kononenko, an influential member of the Petro Poroshenko Bloc and one of the President’s business partners. The immediate reason was the attempt by the Presidential Administration to impose a new deputy on Abromavičius who would have been responsible for financial flows and supervising strategic enterprises. The minster’s request for resignation must be approved by the parliament, although a vote on this should not be expected until the main factions can come to an agreement on the form of the government reshuffle (Abromavičius will be the fifth minister to stand down whose resignation has not been voted upon).

Commentary

• The decision by Abromavičius, one of the most important ministers in the government, and a person of key importance to the reform of the state, comes two weeks before the parliamentary debate on the report by the Yatsenyuk government. We can assume that the minister did not want to take part in it or to try and defend a decision over which he had had no influence, especially since the debate could lead to the collapse of the government. As a Lithuanian citizen, naturalised as Ukrainian in 2014, and an experienced financier, Abromavičius adopted an independent position in the government, while remaining outside the political system.
• Minister Abromavičius, together with the other foreign specialists asked to join the government at the recommendation of the President, were supposed to step up the reform process, cut corruption and weaken the influence of oligarchs, and thus facilitate the implementation of legal and economic changes in line with EU standards. However, it soon became apparent that both the President and Prime Minister’s inner circles are dominated by people linked to the major oligarchs, and interested in maintaining the existing state of affairs. The resignation of the Minister for Economic Development is a symbolic acknowledgement of the failure of the attempts to structurally reform the state, including the anti-oligarchic policy.
• The resignation of one of the strongest ministers has deepened the crisis within the government, which has been ongoing since last autumn. The government has lost its stable support in parliament because the four-party ruling coalition only exists de jure, and is becoming increasingly unpopular among the public (distrust of the government is running at 81% of voters). The only reason why the Yatsenyuk government is still operating is that it is impossible to form a new coalition and appoint a new cabinet in the present parliament. Abromavičius’s resignation makes it ever more likely that early general elections will be held in the autumn. President Poroshenko will probably try to build up a second (next to the Petro Poroshenko Bloc) pro-presidential party, to be headed by Mikheil Saakashvili, the popular Governor of Odessa oblast, whose main campaign slogan will be the fight against corruption. The deep crisis in the government means that Ukraine has entered into a period of political instability, as a result of which there will be further significant delays in the process of reforming the state, and some of the changes already initiated may even be suspended.