The EU’s support for the fight against corruption in the highest echelons of power in Ukraine is ineffective. This is the conclusion reached by the European Court of Auditors (ECA). Her 80-page report on the audit of assistance to Kiev in this area was published on Thursday, September 23.
High-level corruption is the main obstacle to the development of Ukraine
The main question that the auditors asked was to determine how effective Brussels’ assistance to Ukraine was in the fight against corruption at the highest power-bureaucratic level. “We have come to the conclusion that EU support has been partially effective in fighting corruption,” the report says.
At the same time, in the ECA press release, the wording is tougher: “The EU’s support for reforms in Ukraine is ineffective in the fight against high-level corruption.” And Johan Parts, a member of the Accounts Chamber who was responsible for preparing the report, summed up Brussels’s measures to combat corruption in Ukraine: “There are many EU initiatives, but so far no breakthrough.”
The EU has not developed a targeted strategy to overcome large corruption in Ukraine
In its audit, the European Court of Audit focused on high-level or large (large) corruption. By it auditors understand high-level abuse of power, from which a small group of people benefit, while it causes “serious and widespread harm” to the whole society. It is this kind of corruption that ECA considers the main obstacle to the development of Ukraine.
“We have determined that while the EU supports reforms to combat corruption and has helped reduce opportunities for it, high-level corruption remains a key problem for Ukraine. Judicial reform faces obstacles, anti-corruption authorities are under threat, trust in such institutions remains low, and the number of court sentences for small corruption, “- the report says.
The EU does not have a strategy to counter the big corruption in Ukraine
The ECA explains that the European Commission and the EU’s foreign policy service (EEAS) paid attention to corruption in Ukraine and perceived the fight against it as a priority permeating the entire dialogue with Kiev. “But they have not developed a targeted strategy to overcome the great corruption and dominance of the oligarchic system,” the report adds.
EU foreign policy service perceived the fight against corruption in Ukraine as a priority
The auditors analyzed 24 European programs and projects for Ukraine, for example, macro-financial assistance. Only one of them – “Anti-Corruption and Support for Key Reforms” – was aimed generally at countering corruption. Half of the rest of the programs and projects dealt with this topic in one way or another. And not a single project was focused specifically on combating large-scale corruption, the ECA notes.
Based on this, the Accounts Chamber recommended the European Commission and EEAS to develop a “strategic document on how to prevent high-level corruption and fight it” in Ukraine. “This document should define key actions with a clear time frame,” advise the authors of the report and give this time until the end of 2022.
Oligarchs, seizure of the state in Ukraine and money laundering
The ECA cites the oligarchic system as the main reason for high-level corruption in Ukraine. And although the European Commission in 2014 declared the domination of oligarchs in Ukraine, the programs analyzed by the auditors “did not directly deal with the oligarchic system.” Only one project was named an exception in the ECA – the creation of a register of national public figures of Ukraine, the administrator of which is the public organization “Anti-Corruption Center”.
According to the auditors, the EU’s anti-corruption strategy in Ukraine should include specific measures to counter the oligarchic structure. In particular, the ECA advises to develop “a model to prevent individual Ukrainians (oligarchs and persons under their influence), who are suspected of high corruption, from entering the EU and using their assets there.”
Are you talking about a proposal to introduce an EU sanctions regime for corruption, as called for, for example, by the European Parliament? To this question DW Johan Parts answered: “Indeed, our recommendations do not sound specific. But this is because we are auditors.” Parts explained that the question of how to implement them specifically is up to the European Commission and politicians in the EU. The auditors point out that the peculiarity of the oligarchy in Ukraine is “state capture”.
This is how they describe a situation when influential persons and companies benefit from the state, first of all, by influencing state-owned enterprises. Although the European Commission has supported the privatization of state-owned enterprises in Ukraine, so far only small privatization is progressing there, the ECA notes. Auditors also talk about the threat to achievements in corporate governance of large state-owned companies, as demonstrated by the recent appointment of Yury Vitrenko as chairman of the board of Naftogaz.
Success in the fight against corruption in Ukraine
Along with criticism, the Audit Chamber also points to certain positive results, to which the EU is involved. We are talking, for example, about the launch and operation of the National Anti-Corruption Bureau and the High Anti-Corruption Court.
EU contributed to the launch of the work of anti-corruption authorities in Ukraine
The report also points to four projects that “reduced corruption and directly saved money.” Two of these projects were aimed at supporting civil society and, in particular, “helped to expose the corruption scheme, to draw public attention”, and the collected evidence was passed on to law enforcement agencies. The ECA therefore advises the European Commission to “assess and adjust” the scope of support for investigative journalism and activists accordingly.
Johan Parts said that the auditors discussed their proposals in detail with the European Commission and EEAS. According to him, they fully agreed with six of the seven recommendations, and with one more – regarding monitoring and public reporting on the fight against corruption in Ukraine – partially.
The audit mainly covered the period 2016-2020, however, it also took into account the events that occurred in 2021 – until the final adoption of the report on July 20. The Court of Accounts assessed only the actions of the European Commission and other EU institutions. The report emphasizes that it does not contain any assessments of the actions of the Ukrainian authorities or any of the EU member states.
See also:
.