The conflict in Donbas, which began in 2014 following Russia’s annexation of Crimea and Ukraine’s Euromaidan revolution, has claimed approximately 14,000 lives to date and continues to hinder and deter long-term investment prospects.
Initially triggered by then-president Viktor Yanukovych’s pivot away from signing an association agreement with the EU, the ongoing fighting in the Donbas, which I’m researching, continues amid deadlocked attempts to cement peace. Ukraine’s new president, Volodymyr Zelenskiy, has vowed to change this, albeit at a potentially questionable price.
The Ukrainian government has set an ambitious target to increase the country’s GDP by 40% in five years, with Zelenskiy relentlessly courting foreign investors and proposing a number of rather libertarian reforms to make Ukraine a more attractive destination for foreign capital. Achieving these ambitious targets, however, relies on the fighting in the east coming to a definitive end.
This is why Zelenskiy is pushing hard for local elections, due in October 2020, to also take place in occupied parts of the Donbas. While this timeline is arguably unattainable without Russia’s cooperation, if met it would become the hallmark of Zelenskiy’s presidential legacy.
Zelenskiy has repeatedly stated that his main priority is to end the fighting and prevent further loss of life of Ukrainian citizens – not to necessarily reclaim the physical territory of the breakaway areas. This strongly implies that Zelenskiy believes the occupied areas won’t be reclaimed during his presidency. Instead, a more realistic approach appears to be ending the fighting to pave the way for local elections by implementing the so-called Steinmeier formula, named after the former German foreign minister Frank-Walter Steinmeier, who suggested it in 2016.
Despite domestic opposition to what many perceive to be capitulation to Russia, Zelenskiy has taken a strategic step in this direction by replacing his chief of staff Andriy Bohdan with Andriy Yermak, who will oversee negotiations pertaining to Donbas with his Russian counterpart.
Bohdan’s departure bodes well for Zelenskiy’s international image and distances the president from the notorious oligarch, Ihor Kolomoisky, to whom Bohdan once served as an adviser. But it also underscores Kyiv’s willingness to bargain with Moscow, given Yermak’s alleged softer stance towards Russia.
View from Moscow
At the same time as Kyiv confirmed Yermak’s appointment, the Kremlin also officially announced that Dmitry Kozak would replace Vladislav Surkov as Russia’s chief negotiator on Ukraine. Surkov became rather toxic for Moscow’s image and was a key force behind the maintenance of the Russia-backed separatist enclaves in eastern Ukraine. By replacing him, Moscow seems to be signalling its readiness for a new approach with Kyiv, given Kozak’s less hawkish image and his history of working with Yermak on key issues such as prisoner swaps. Yermak told Ukrainian television that Kozak was an improvement over Surkov.
But the change probably doesn’t indicate that Moscow is suddenly softening its policy towards Ukraine. Retaining influence over the breakaway territories is still likely to remain Russia’s political endgame. Still, the Kremlin could be feeling the economic costs of its political “pet projects” and be seeking potential ways to start normalising its relations with the west without ultimately sacrificing its political agenda in the Donbas.
Russia has just undergone its own political reshuffle. As it doubles down on its efforts to address the country’s flagging economy and improve welfare provision to halt growing discontent, it makes sense for Moscow to distance itself from accusations that it is responsible for ongoing ceasefire violations through its support of separatist militias in eastern Ukraine. The newly appointed technocratic government in Russia will want to avoid further economic sanctions from the west.
Kozak represents a strategic choice for Moscow. Still, a desire to stabilise relations with the west doesn’t mean that Russia will radically change its policy towards Ukraine and Donbas, or turn its gaze away from other Russia-backed separatist enclaves.
Stability over sovereignty
Ongoing war – along with corruption – is a key deterrent to investment, something that Zelenskiy and his administration are very much aware of. During the Munich security conference in mid February, Zelenskiy stressed that his administration was ready for dialogue with the residents of occupied Donbas and even proposed a new approach to resolving the conflict.
The bold targets that the president’s team have set, however, require a number of compromises, or at the very least, changes in approach. These changes are unlikely to be met with equal enthusiasm from all factions in Ukrainian society. Despite the likelihood of vehement domestic opposition, in particular from veterans of the conflict, Kyiv is nevertheless set on pushing through its peace efforts.
Zelenskiy’s short-term approach to dealing with the Donbas issue by prioritising stability over sovereignty to help attract investment could legitimise the breakaway territories’ political status as separate to Ukraine, particularly if Russia-backed candidates are elected there in the proposed local elections. The Kremlin may calculate that a frozen conflict is therefore less costly than the current situation. A further indication that Moscow is seriously considering freezing the conflict will be if it agrees to another “Normandy Four” peace summit between Germany, Russia, Ukraine and France, which Kyiv hopes to hold in April.
Although the prospect of peace has moderately improved given the revived efforts on both sides, Kyiv does not yet have any guarantees that Moscow is equally committed to the 2020 local elections taking place in the Donbas. Meanwhile, the ultimate price of peace might nevertheless prove too high for Zelenskiy to pay given the irreconcilable views of domestic opposition and his administration.
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