A Ukrainian oligarch’s foiled homecoming

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Lara 1:08 pm on December 3, 2015
Tags: Kyiv ( 34,223 )
A Ukrainian oligarch’s foiled homecoming
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A controversial Ukrainian powerbroker’s rehabilitation campaign is hitting unexpected snags.

Dmytro Firtash, the exiled oligarch who wants to make a comeback at home, was forced to cancel plans to return to Kyiv this week after a government minister said the businessman would be arrested if he set foot in Ukraine.

Firtash called the warnings “political persecution.”

“I deeply regret that the current Ukrainian government has taken unprecedented steps and done everything possible to prevent my return to Ukraine,” he said in a statement released Tuesday by the Federation of Employers of Ukraine, whose annual congress he was supposed to preside over in Kyiv on Wednesday.

Firtash, who has been living in Vienna for over a year, is the subject of an ongoing criminal investigation in Ukraine and is accused of stealing state funds. He also remains under federal racketeering indictment in the U.S. He avoided extradition to the U.S. in April after being arrested in Vienna on FBI bribery charges that an Austrian judge subsequently dismissed as being politically motivated.

Ukraine’s Internal Affairs Minister Arsen Avakov announced on Sunday that, after consulting with U.S. officials, he instructed Ukrainian police to detain Firtash should he attempt to enter Ukraine.

“The speculation and tricks that have been used by Mr. Firtash to avoid justice in Ukraine and the United States are doomed to failure,” Avakov said after Firtash aborted his trip.

An attempt to get back in good graces

The oligarch’s trip to Kyiv would have been the culmination of an extensive political and public relations campaign that Firtash, now worth an estimated $500 million, has been pursuing around the world, largely through the philanthropic activities of his non-profit, the Firtash Foundation, as well as political maneuvering by his allies in Kyiv, where the foundation keeps an office.

This year alone, Firtash, through his foundation and presidency of the Federation of Employers, has helped bankroll a high-profile exhibit of Ukrainian art in London’s Saatchi Gallery, a new Washington memorial to the 1930s Holodomor famine, and the creation of the Agency for the Modernisation of Ukraine, which released a 424-page report in September.

The report was presented to Dmitryo Shymkiv, deputy head of the presidential administration, in September. Shymkiv said he was puzzled by its recommendation to stop privatization and noted that it was “lacking implementation and concreteness.”

Dmytro Firtash (L), attends a trial on April 30, 2015 in Vienna after being arrested in Vienna at the request of the FBI and Viennese court. Photo by SAMUEL KUBANI/AFP/Getty

Despite months spent developing and promoting the project, the agency’s findings were largely ignored. A handful of former European politicians were lured out of retirement to participate in the project, whose authors include French intellectual Bernard Henri-Lévy, British lawyer Lord Ken Macdonald, former Austrian foreign minister Michael Spindelegger, and former EU Commissioner Günter Verheugen, among others.

The ostensible purpose of Firtash’s trip to Kyiv was to promote the report.

Some believed that Firtash had received assurances that he would be able to clear customs before announcing the trip. Sergiy Leshchenko, an MP in President Petro Poroshenko’s block, said there was no reason to believe Firtash would be detained and questioned upon arrival.

But Andriy Biletsky, commander of Ukraine’s nationalist Azov Battalion, said that his volunteer fighters would arrest Firtash themselves if government forces failed to do so. He later posted a Facebook photo of his armed men waiting at Kyiv’s Borispol airport.

“Who are these people? A group of people in masks making threats. In any normal country you would be put in jail for this,” Firtash told the Guardian in Vienna.

Firtash has significant investments in Ukraine’s natural gas infrastructure as well as chemical plants and real estate, making much of his fortune as a middleman between Russia and Ukraine. He also bankrolls local political candidates.

A political oligarch

As with all other Ukrainian oligarchs, Firatsh is closely entwined with his country’s politics. He was a significant financial backer of former Ukrainian President Viktor Yanukovych and his Party of Regions.

That has made him a target of Poroshenko’s so-called de-oligarchization policy, which aims to cut the power of the country’s wealthy elite. The president himself is a wealthy businessman worth about $730 million, according to Forbes. His policies have sought to clip the wings of magnates like Firtash and Rinat Akhmetov, the country’s richest man, who backed the previous government and whose commitment to Ukraine’s independence in its war against Russian-backed separatists has seemed suspect.

“The former Donbas lobby, which includes Firtash, Akhmetov, and a couple of other people, they have been losing power in Ukraine,” said Balazs Jarabik, a nonresident scholar at the Carnegie Endowment for International Peace.

Another oligarch, Ihor Kolomoisky, who initially helped finance Ukrainian resistance from his power base in Dnipropetrovsk, has also fallen out with the government.

But whether out of favor with Poroshenko or close to the Kyiv government, oligarchs continue to play an enormously powerful role in the country’s politics.

For his part, Firtash is using his influence to try and push for Ukraine’s decentralization, and favors the country being a “bridge between Europe, Russia and Asia,” in opposition to the govenrment’s current policy of building closer ties with the EU.

That makes it tempting for the government to take aim at him, removing a potential rival as well as showing the West that it is tackling the oligarchs who have warped and corrupted Ukraine’s public life over the last two decades.

“The signaling from the U.S. side in particular has been intensively negative on Firtash,” said Matthew Rojansky, director of the Kennan Institute in Washington. “That creates a political space in which the Ukrainian leadership can always make Firtash their scapegoat, which allows them to check the box on de-oligarchization when they’re not checking it more broadly.”

If Kyiv continues to block Firtash from returning to Ukraine, that would make it very difficult for him to protect his assets, which could reduce his political power.

“You can’t defend your property in a country like Ukraine without being there,” said Anders Aslund, senior fellow at the Atlantic Council. “[Firtash] and Sergey Lyovochkin, who are business and political partners, have a substantial number of parliamentarians on their side. This is the biggest oligarchical faction in the Ukrainian parliament. It’s quite important for deoligarchization if the politically most influential oligarch can’t enter Ukraine.”

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Lara 1:08 pm on December 3, 2015
Tags: Kyiv ( 34,223 )

A Ukrainian oligarch’s foiled homecoming

News.Kyiv.Me.

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Lara 1:08 pm on December 3, 2015 Tags: Kyiv ( 34,223 )

A Ukrainian oligarch’s foiled homecoming

Lara 1:08 pm on December 3, 2015
Tags: Kyiv ( 34,223 )