Political discontent within Ukraine is growing, as the war shows no signs of ending and corruption continues to plague the domestic economy. Moreover, both Brussels and Washington appear to be backing away from Kiev.

Ukrainian people march during a protest outside the Ukrainian parliament in Kiev, Ukraine, Dec. 8, 2016. Several thousands of people took part in a protest by the Ukrainian Trade Union Federation calling for increased salaries and pensions and cutting housing and utility tariffs. Photo: AP

Three years after the beginning of the Euromaidan protests in Kiev, the future of Ukraine is as uncertain as ever. Economic and political reforms have failed to overcome serious structural problems in the country. Moreover, the “frozen conflict” in the East rages on and continues to sap the country’s budget. Popular discontent is rising, with three out of every four Ukrainians expressing disapproval with the current government.

To top it off, uncertainty over international support further decreases the chances of the government weathering the crisis. Given the rising risk of domestic political destabilization in Kiev, is time running out for a solution?

On the domestic front

Ukraine is undergoing a serious attempt to reform its economy and government. Young professionals can be found milling about in almost every government ministry. However, in private conversations, the sentiment is that reforms are not coming fast enough to ensure continued domestic and international support.

“Reforms can’t happen overnight and require significant shifts in attitudes amongst citizens, government officials, and businessmen. Best practices may take at least five years to be implemented,” said Andrew Platonov of the Democracy Study Center in Kiev.

“However, the reform process is on the right track and is gaining momentum. In three years’ time, the country has achieved more than in the previous 20 years after independence,” he added.

Of the many laws passed by the current Rada, judicial and anti-corruption reforms have been the most publicized. These include the creation of a brand new supreme court, a system of electronic declarations of assets and incomes for elected officials, a public e-procurement system, and the National Anti-Corruption Bureau.

However, in private conversations with government officials, civil society activists, diplomats, and businessmen, the mood is more pessimistic. One German investor, who asked not to be named, said that corruption remained a major issue for Western investors, and that there was not much confidence that a real breakthrough would happen to rectify the problem anytime soon.

According to the latest statement of the International Monetary Fund (IMF) mission to Ukraine, “Tangible results in prosecuting and convicting corrupt high-level officials and recovering proceeds from corruption have yet to be achieved.”

 The same IMF statement predicted anemic economic growth of 1.5 percent in 2016. The question is: Will that be enough to alleviate social discontent over poverty and low living standards?

Discontent with the slow pace of reforms is palpably growing amidst several high-profile corruption scandals. One of the most recent involved a string of Spanish villas, linked — but not declared — to Ukrainian President Petro Poroshenko and his political allies. 

Corruption scandals earlier this year had already led to the resignation of Prime Minister Arseniy Yatsenyuk in April.

One oft-repeated phrase heard in Kiev today is that the only institutions trusted by the Ukrainian people are the army, the church, and the volunteers.

Also read: "Kiev embraces a multilateral approach to resolve the Ukraine crisis"

On the Eastern front

Apart from rising social tensions and the slow pace of reforms, the incessant conflict in the East presents another major obstacle for the Ukrainian government. Attracting investors to the country and keeping the budget under control are two major casualties of the war. Furthermore, the Poroshenko government seems to be stuck in a quagmire in which ending the war could lead to political suicide, while continuing it risks rising political instability.

The prospects of an all-out Ukrainian victory in the war appear slim, given Russia’s support of the rebels. The catch is that as long as there isn’t a successful end to the war, the economic and political strain on the government in Kiev will increase. Defense and security spending was 5 percent of GDP last year, as Ukraine grappled with creating a new army, and according to President Poroshenko, this was one of the reasons for the failure to increase living standards. 

While talks of another uprising may be premature, it is no secret that a large number of Ukrainians are unhappy with the way the war is going.

According to Vladimir Nizov, a former resident of Donetsk and currently a Ph.D. student at the Higher School of Economics in Moscow, “It will be impossible for Ukraine to restore control of Eastern Ukraine through military action.”

“The Ukrainian army is stronger than it used to be, but not enough for an operation of that scale. Moreover, the position of Russia is clear in this case: in case of an escalation, the rebels will receive additional military support. A new hot wave of conflict could have huge negative consequences for Mr. Poroshenko.”

Accordingly, Kiev is neither able to pursue a compromise with the separatists because of fear of a domestic backlash, nor is it physically capable of overrunning the Russian-backed separatists. Meanwhile, domestic pressure for success in the war is brewing.

On the international front

By all accounts, the geopolitical confrontation between Russia and the West in Ukraine has been detrimental to all of the parties involved. Decreased cross-border trade and increased security risks have affected the entire region, amidst a complete breakdown in trust that has raised the security dilemma in Eastern Europe to Cold War heights.

Remarkably, none of the actors involved in the Ukrainian conflict appear ready to adjust their position to find a solution out of the deadlock. The EU, Ukraine, the rebels, and Russia are all playing a waiting game, in which every subsequent turn brings the region further into turmoil.

Russia continues to support the separatists in the East, Ukraine continues to fail to implement key sections of the Minsk 2 agreement, such as decentralization, while the EU continues to blame Russia for the destabilization, without considering Russia’s concerns regarding Ukraine’s future geostrategic orientation, or the reality on the ground in Kiev.

The epitome of the deadlock is the faltering Minsk 2 agreement, which has failed in all but name to stop the conflict and reassert Ukraine’s sovereignty in the Donbas region. Normalization is nowhere on the horizon.

While Western sanctions against Russia are projected to be prolonged in January, it’s doubtful whether they will lead to any breakthrough in the conflict. Given the absence of other means for pressuring Russia other than sanctions, it’s safe to say that Russia’s position on Ukraine is unlikely to budge. Decentralization, a special status for the Eastern regions, and local elections will need to be implemented before control is ceded.

Meanwhile, the changing international environment may be a game changer for the conflict. With unequivocal support from Washington and Brussels no longer guaranteed in the era of Trump and European populism, Kiev may be forced to accept concessions amidst rising international and domestic pressure.

Given Ukraine’s domestic problems and pressures for a quick breakthrough, escalation or compromise may be the only options on the table. The consequences of both are difficult to predict.
