Preventing Corruption in Foreign Assistance to Ukraine


SEATTLE — Ukraine is a major recipient of U.S. foreign assistance, and is planned to receive $203,780,000 in funding in 2018. With corruption running rampant, Congress is tasked with ensuring the integrity of foreign assistance to Ukraine.

Ukraine’s public sector is one of the most highly corrupt governments in the world. According to Transparency International’s 2017 Corruption Perceptions Index, Ukraine ranked 130th out of 180 countries, scoring 30 on a scale of 0 to 100, with 0 being most corrupt.

Amidst a war-torn Donbas in eastern Ukraine, the developing nation depends on foreign assistance now more than ever. That is why Ukrainian economists, nationals and U.S. officials have spoken out about the best practices in foreign assistance to Ukraine.

Minimize Corruption

Out of the 19 USAID programs in Ukraine, five are dedicated to fighting corruption. Reducing the potential of corruption in aid itself is a crucial part of anti-corruption efforts.

“In my view, Ukraine is politically sick and it is sick fatally because the name of its sickness is [corruption]. As any type of [sickness], this one is also incurable. One cannot eradicate corruption. One can only try to minimize it,” said Vladimir Zakhvataev, a prominent Ukrainian lawyer and author who has published various legal treatises in Ukraine.

Partner with NGOs

Anti-corruption proponents are calling on the U.S. government to reconsider how aid is delivered.

“In my opinion, the only acceptable aid to Ukraine is the one where the relevant foreign sponsor or government takes the trouble of fulfilling the relevant project himself, i.e., without releasing money to Ukrainian officials,” stated Zakhvataev, who believes Ukrainian’s officials’ only motive is winning electoral races.

“The challenge is always in the execution,” said former Secretary of State Rex Tillerson during his nomination, suggesting the U.S. should avoid giving grants directly to the hands of other governments, but rather partner with credible NGOs to execute aid projects.

Maryan Zablotsky, president of the Ukrainian Economic Freedoms Foundation, suggested similar ideas in a Forbes editorial.

Use Information Technology

If you can trace corruption, you can stop it.

Volodymyr Omelyan, Ukraine’s Minister of Infrastructure, was recently appointed by USAID as a partner against corruption. Omelyan is developing a blockchain to track and fine international cargo, preventing resales on the black market. The use of blockchain technology will prevent inspectors from manipulating the e-cabinet, thwarting bribery and corruption.

Still, more research is needed, as deep-seated corruption is difficult to pinpoint. “Sadly, we don’t have survey evidence of corruption specifically involving businesses involved in aid contracting,” said Charles Kenny, a director with the Center for Global Development.

Increase Government Transparency

Ukraine has begun to “follow the money” of its powerful bureaucrats.

Its politicians have recently been exposed due to laws such as “On the Prevention of Corruption,” adopted in October 2014 by the Rada, Ukraine’s Parliament. The law requires public declarations of income and expenses by public servants. According to USAID, this was one of the few measures the Rada took to prevent corruption. The exorbitant financial disclosures resulted in shockwaves of anger across Ukraine, where poverty is widespread.

Encourage Political Accountability

Despite the new legislation, Ukraine’s wealth reporting system has been hedged with corruption in and of itself.

In November 2017, the National Anti-Corruption Bureau of Ukraine (NABU) filed a criminal case against the National Agency on Corruption Prevention (NAZK), its sister agency. NABU’s allegations state NAZK officials slowed the progress of wealth reporting legislation to cover up their receiving of “undue benefits in especially large amounts, combined with the extortion of such benefits.”

One month later, on December 6, 2017, the Rada filed a bill allowing Parliament to dismiss the head of NABU.

The same day, former U.S. Deputy Assistant Secretary of the U.S. Department of Defense for Russia, Ukraine and Eurasia, Michael Carpenter, tweeted, “If the Rada votes to dismiss the head of the Anticorruption Committee and the head of the NABU, I will recommend cutting all U.S. government assistance to Ukraine, including security assistance. This is a disgrace.”

On December 7, 2017, only one day after Carpenter threatened foreign assistance to Ukraine, the bill was withdrawn from Parliament’s consideration.

“[Foreign aid] is a permanent source of temptation for the Ukrainian officials who have built up a very efficient network of corruption and who covet [foreign]aid because its use is poorly controlled and because it can be easily pocketed,” Zakhvataev said.

Restore Justice

Having practiced law in Ukraine for 45 years, Zakhvataev is a major proponent of fixing its justice system.

“Regarding the current justice system in Ukraine, it is hopeless. Its members are bogged down in corruption. Wallowing in briberies themselves, they eagerly set free those who pocket billions from the state budget and, when captured, lavishly share these millions with the judges.”

The USAID’s current anti-corruption program involves creating a special court to fight corruption under the “New Justice Program,” involving a partnership with NAZK, the Rada and the president’s office.

“Another acceptable and very important aid to Ukraine would be the aid in the area of education of the young generation of Ukrainians who will govern the country in the future,” said Zakhvataev. A focus such as this can encourage future generations to resist corruption and expose it where it remains, hopefully leading to the decline of corruption in Ukraine.

– Alex Galante

Photo: Flickr


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