The crisis in Ukraine continues to grow with pro-Russian demonstrators now declaring an independence referendum in the city of Donetsk. Yet the members of that elite club who will help shape Ukraine’s future when this current crisis is over — the oligarchs — remain conspicuously quiet.
These highly influential figures, many of whom are billionaire owners of business empires forged as the Soviet Union collapsed, have long been the real driving force in Ukrainian politics. When the next election slated for May this year takes place they are expected to do what they have always done: fund rival political campaigns that further exacerbate the East-versus-West and Europe-versus-Eurasia divisions on which the foundations of today’s crisis are built.
For most in Europe or America, names of Ukrainian oligarchs such as Pinchuk, Kolomoisky, and Akhmetov are interchangeable with Russian counterparts such as Abramovich, Deripaska, and Khodorkovsky. Wealth they may have in common but the crucial difference is in Ukraine their interests are interwoven with politics. This appears to be a worthwhile pursuit for the wealthy: it provides the prospect of influencing decision-making for your own advantage. Holding your own seat in parliament offers handy immunity from prosecution. Their Russian equivalents are allowed no such role or benefits: Khodorkovsky spent his years in jail because he attempted involve himself in the affairs of government; another, Berezovsky was exiled and eventually ruined in part because of his attempts to stand up to the Kremlin.
But now, in the face of today’s crisis, Ukraine needs its oligarchs to disengage from politics. Their political involvement is what has helped drive their country to division and economic crisis, because of the way – unlike in Russia — the political pendulum is able to swing in favour of one group and then their opponents. Those oligarchs that have funded more Russian-facing candidates, because their business interests are dependent primarily on trade with Russia, benefited over the last four years during the presidency of Viktor Yanukovich. During that time their western-friendly rivals were confronted with court cases, tax demands and invasive audits, damaging their interests. When Yanukovich’s western-leaning predecessor Viktor Yushchenko was in office it was they who enjoyed the spoils of a friendly government while their more Russian-leaning rivals suffered.
Now, as Russia digs in in Crimea, some of Ukraine’s oligarchs have rallied to the cause of their country’s territorial integrity. They have publicly stated they stand for the territorial integrity of Ukraine and will help defend it. Yet this alone is insufficient unity to benefit to the country in the long-term, and smells of self-interest. After all, none would be able to engage in politics in any future Ukraine dominated by Vladimir Putin.
Ukraine’s oligarchs can and must do better than this: by taking a new, united stance they can help to shape the future of their country long after the crisis with Russia has abated. Firstly, they can stop fighting each other. They should and can impose upon themselves a ceasefire. Already vastly wealthy and powerful, they have the chance to ensure the political pendulum does not swing to punish them in the years when their political front men are out of office. Under such a truce there would be no more winners and no more losers as the political seasons turn.
Secondly, they should agree to stay out of politics. Through a collective accord not to fund political parties, or at least an agreement to cap contributions at a low level, the vast cost of Ukrainian election campaigns — already in the league of U.S. election spending — could fall, perhaps over time even allowing for the rise of political parties elected on policy-platforms, not on a geographical power base or depth of their pockets. This might seem a self-imposed version of the division between politics and oligarchs that exists in Putin’s Russia, but it would be of immense benefit to the country when their political proxy wars have only ever ended in expensive stalemates.
Finally, the oligarchs must commit to the rule of law in their own country and support a program that ensures Ukraine becomes a real democracy and good neighbor to both Europe and Russia. Nearly all the oligarchs have direct experience of doing business with and even living in functioning democracies with political and social pluralism, stock exchanges, and an independent judiciary. They know the benefits and how it should work, and they can help make it a reality in Ukraine.
Given the crisis, the potential for a settlement — an “oligarch’s charter” — is perhaps higher today than at any previous time. This is the chance of a generation for these business and political rivals, many driven by personal animosity and distrust for each other, to sit down and agree to leave each other’s interests alone and end the destructive cycle of recrimination and retribution. If in other nations individuals as far apart as Mandela and de Klerk in South Africa and Gerry Adams and Ian Paisley in Northern Ireland can sit down and sign agreements to end hostilities and unite for their sake of their countries, then so can the oligarchs. What a charter would signify is that Ukraine can move forward with oligarchs acknowledging the country has done well by them and it is time for them to repay the debt.
Of course, they need not do any of this. The majority could remain silent in the current crisis. They could continue to reap the benefits of the rule of law in other parts of the world, but never work to bring it to their homeland. They could all prepare quietly to arm their political friends with the resources required to fight and win the forthcoming election. Given the interest in Ukraine from the international community that one will no doubt be the most free and fair in the country’s history. Yet even a legitimate vote and count will not deliver a prosperous future for Ukraine because alone it will never secure the stability the country needs. That falls to the oligarchs. Their time to agree has come.
Peter Magyar is the European Chairman of Freedom Now, the Washington DC based NGO defending prisoners of conscience worldwide. He is the founder of Magyar &Co, a boutique international law firm based in London and was previously a senior partner at Baker & MacKenzie, where he worked extensively over the last 20 years on privatizations and corporate transactions across Central and Eastern Europe and the former Soviet Union.