May 15, 2014
In Ukraine’s East, the Cautious Middle Path of Oligarch-in-Chief Rinat Akhmetov
Business Magnate Speaks Out for Ukraine’s Unity, but Does Not Condemn Separatism
But in the fight for the region’s future – between Ukraine and the hundreds of Russian-backed guerrilla fighters who have seized government buildings and demand that two Donbas provinces secede from the country – Akhmetov has not clearly chosen either side. He is a formidable force whose visible role has been ambiguous.
On Wednesday, after three months of street fighting, killings, demonstrations and diplomatic battle between Russia and Ukraine, Akhmetov made his most prominent statement so far on the conflict, saying that eastern Ukraine should not separate from the country or unite with Russia as demanded by Russian-backed militias, but should win greater regional powers from the government in Kyiv. Akhmetov lamented the violence, but offered no word of criticism for its authors.
In a video posted on the website of his holding company, the Donetsk-based Systems Capital Management, Akhmetov did not criticize secession on any basis of a declared allegiance to Ukraine; rather, he said secession won’t work because the international community would impose economic sanctions on Donbas.
“We would fall under enormous sanctions, and we would not be able to sell or produce” goods, Akhmetov said, speaking in Russian. “That would mean unemployment; that would mean poverty,” he said. “I strongly believe that Donbas can be happy only in a unified Ukraine,” he said.
“He spoke carefully in what is for him a difficult situation,” said former US ambassador to Ukraine John Herbst, now director of the Eurasia Center at the Atlantic Council. “But the weight of his statement is toward a united Ukraine.”
Akhmetov’s video statement followed a middle-of-the-road step by him last weekend, in which one of his companies announced it would send its workers, unarmed, to help local police patrol and maintain order in Mariupol, a city in Donetsk province that had seen some of the worst fighting in recent weeks. [UPDATE, MAY 16: The patrols by workers seem to have established a significant degree of control in Mariupol and have been expanded to at least four other cities in the region. It's the first concrete, visible intervention by Akhmetov in the conflict, but his support for the government is limited and his price for it remains unclear.]
Akhmetov, 47, was born in Donetsk to an ethnic Tatar family and has dominated for years in a city and region where electoral politics, corruption and organized crime are closely related contests. He has been an important financier of the Party of Regions, which has been the great political machine of eastern Ukraine. Akhmetov served as a Party of Regions member of parliament. But the ouster from power of the party’s top leader, President Viktor Yanukovych, has thrown it into disarray. This weakening of Akhmetov’s longtime political vehicle may mean that his guiding allegiance in the current conflict is to re-consolidate his political position, first by maintaining his dominance in Donbas.
Ukrainians who favor keeping the country unified and orienting it more toward Europe say Akhmetov has avoided embracing that vision as he has played both sides of the conflict to consolidate his own position. Akhmetov says he has had talks with the secessionists. He denies statements both by Kyiv government loyalists and by separatist leader Pavel Gurbayev that he has made payments to the separatist camp in order to buy a degree of support from them. (Gurbayev made that claim in the Russian daily Rossiskaya Gazeta on May 12.)
“I have not bought out anyone, I have persuaded them,” Akhmetov said in a response issued hours later and quoted in the English-language daily Kyiv Post.
“Akhmetov could have dealt with the separatists directly any time he wanted to,” says Serhiy Hrabowsky, a Kyiv-based political analyst and commentator. “The situation has become so destabilized, and the local authorities [in Donbas] have been so ineffective in protecting people against attacks by the militants,” that an attempt by Akhmetov to clean up the situation would be very popular. Akhmetov “has armed security personnel at his disposal, both personal bodyguards and security units at his factories, largely made up of army veterans.”
While Akhmetov’s money and influence might have gotten a grip on Donetsk some time back, that moment has passed, said Serhiy Harmash, the chief editor of Ostrov, a Donetsk-based news website. “Akhmetov can no longer control the streets. Too many weapons are out there now, in the hands of criminals and people who yesterday were the dregs of society and today are holding some power.”
To the question at the beginning – What is Akhmetov’s vision for Donbas? – his video statement fleshes it out: He wants Donbas to be happy.
Akhmetov began writing that formula publicly after the declaration by separatists that 90 percent of participants in their May 11 referendum-style demonstration had supported independence. In a statement reported May 12 by the Kyiv Post, Akhmetov called on Donbas residents “to unite around … 'the Happiness of Donbas,' so that every citizen in our region is happy. And what is the happiness of the region? It is when we have a strong economy, new jobs, good employment, good salary and good life.”
Akhmetov expounded in his video. Happiness, he said, is when people have security, the economy is strong, new jobs are being created, “when we are respected, when people honor our heritage, our history and our language as well as our holidays, traditions and our ambitions for making life better.“
In the video, Ahkmetov described four “scenarios” that might represent the future for Donbas. The first, a status quo in which state authority remains centralized in Kyiv, is no longer effective, he said.
He then dismissed both an independent Donetsk People’s Republic and unification with Russia, saying either step would bring heavy international sanctions, unemployment and poverty.
Remaining an integral part of a less centralized Ukraine is the only way forward, he said. The government in Kyiv must extend greater authority to the provinces, whose governments should be elected. Currently, Ukraine’s provincial governors are appointed by the president.
A day after Akhmetov’s statement, it’s not clear how quickly or widely people have seen it in eastern Ukraine. The secessionist guerrillas have seized TV transmitters and replaced broadcasts of Ukrainian TV channels with those of Russian state-dominated media. Except, that is, for Akhmetov’s Ukraina channel, which replayed at least part of his video statement yesterday.
After seizing and annexing Crimea from Ukraine in February, Russia has been supporting the secessionist movement in the east, which is composed of both Russian and Ukrainian fighters. By promoting the uprising – and threatening a military invasion if Ukraine suppresses it with force – Moscow is trying to establish dominant influence in the east of Ukraine without actually invading it, a step that would bring further economic sanctions and the prospect of a long, costly war, Herbst and other analysts have said.
Even though Akhmetov’s opposition to the secessionist movement has been voiced in moderate tones, “it’s not something that is going to please Moscow,” Herbst said.
Irena Chalupa covers Ukraine and Eastern Europe for the Atlantic Council; James Rupert is the council's managing editor.