Travel south from Kiev along the arbored R-12 highway and you will see perhaps the most public symbols of Ukraine’s rampant corruption: a wide array of luxurious estates that have sprung up in Koncha-Zaspa, a leafy suburb of the capital. Many of these multimillion-dollar homes belong to senior state officials with only modest salaries. Investigative journalists have compiled evidence suggesting quite a few of these mansions were bought with ill-gotten gains. This prompted President Viktor Yushchenko to demand in August that the public servants explain how they came to possess such lavish accommodations. But at the time his political opponents from the Party of Regions still ran the government, and they responded to his call for accountability with stony silence.

Ukraine’s graft problems are hardly of recent vintage, though. It was the massive corruption during the presidency of Leonid Kuchma that helped spark the 2004 Orange Revolution. Public anger at large-scale vote buying and voter fraud swept Mr. Yushchenko and his camp, who promised to rid Ukraine of sleaze, to power. But political infighting brought down the Orange government under Prime Minister Yulia Tymoshenko in September 2005 and prevented any real progress on corruption.

Now she has a second chance, after Ukraine’s Orange reformers re-elected her Tuesday to lead a new government. If the Yushchenko-Tymoshenko team fails again, the Orange coalition’s hold on power will prove tenuous. More importantly, corruption could reverse Ukraine’s record of recent economic growth and even threaten its national security.

Transparency International’s Global Corruption Perception Index ranks Ukraine 118th out of 180 states. A recent World Bank study on corruption and good governance shows that after the Orange Revolution, the country actually slipped from its lower-middle position and now has a worse record than nearly three-quarters of the countries surveyed.

Practically all sectors of Ukraine’s government, business and civic life are affected by widespread corruption. Bribery and extortion are particularly common in Ukraine’s judiciary, where favoritism rather than merit determines the appointment of judges. Evidence is routinely “lost” at Ukraine’s courts and bribes can facilitate almost any desired ruling.

In a famous case involving the 2000 murder of journalist and anti-corruption crusader Heorhiy Gongadze, police destroyed evidence related to the case, including some that may have implicated a police unit that had been tailing Gongadze. In 2004, a judge summarily closed the case against a police general who had ordered the evidence destroyed in what press freedom groups and the International Union of Journalists denounced as a cover-up.

Similarly, corruption among politicians is rampant. Alleged vote buying of parliamentarians, who can hide behind extensive immunity rules, has in part been responsible for the political paralysis plaguing the country over the past two years.

Corruption has also serious consequences for Ukraine’s national security, as much of the graft is concentrated in the energy sector. Ukrainian analysts and investigative reporters assert that massive bribery has played a key role in perpetuating Ukraine’s overreliance on Russian gas. Such corruption, experts say, has halted or impaired Ukraine’s efforts to promote internal energy exploration and diversification. The net effect has been to expose Ukraine to Russia’s authoritarian influence. These views are corroborated by Western officials, including U.S. Deputy Assistant Secretary of State David Kramer who at a talk earlier this month at Harvard University called on Ukraine to get rid of all “Middlemen companies” which he said “thrive on non-transparent arrangements ….[,]…fester in a corrupt environment…[and] serve no useful purpose.” He specifically cited RosUkrEnergo, a Swiss-registered company that plays a dominant role in gas imports to Ukraine.

There are a number of key steps Ukraine’s reunited Yushchenko-Tymoshenko tandem should take in the first 100 days of the new government:

  • Strengthen weak and contradictory anticorruption legislation and update government ethics codes that are currently ambiguous or absent altogether.
  • Establish a new judicial chamber, staffed by a new generation of judges untainted by sleaze.
  • Create an independent national investigative bureau to uncover and root out grand corruption.
  • Eliminate or reduce the scope of parliamentary immunity, which lawmakers have used to escape prosecution.
  • Increase transparency by obliging senior public officials and politicians to publish annual statements of assets and incomes.

Anticorruption campaigns must not become mechanisms of political retribution. Thus, prosecutions cannot only focus on the activities of members of the opposition. They must target officials from across the political spectrum, wherever the evidence leads.

But Ukraine is unlikely to win the battle alone. The U.S. and the EU need to step up their assistance in helping Ukraine face this challenge by quickly deploying teams of anti-corruption advisors to Kiev to work with the new government. If they do, the hopes and aspirations of the Orange Revolution will be realized and will contribute to the emergence of a mature and prosperous democracy.

Adrian Karatnycky is president of the Orange Circle and senior scholar at the Atlantic Council of the U.S. Jan Neutze is program officer at the German Marshall Fund of the U.S. They are co-authors of the new Atlantic Council report “Corruption, Democracy, and Investment in Ukraine.”

This column was originally published in the Wall Street Journal.

Related Experts: Adrian Karatnycky