New concerns about bribery in Ukraine are fueling calls in Congress to tighten controls on financial and military aid.
After a year of full-scale Russian invasion, Ukrainian Finance Minister Serhiy Marchenko is steadily receiving enough financial aid from the US and other international allies to keep the Ukrainian state functioning. But now he faced a new task – to dispel doubts related to the corruption history of his country.
Corruption scandals in the Ministry of Defense of Ukraineand other government agencies have intensified calls in the US to strengthen control over the aid that Kyiv receives. More and more American voters and politicians are beginning to be skeptical about the price of financial and military support for a country that is defending itself against Russian invasion, the Wall Street Journal writes.
Republican members of the House Oversight Committee appealed to the administration at the end of February. Joe Biden with a demand to provide more information about the control over aid that Kyiv receives at the expense of taxpayers.
“It is very important that public institutions that dispose of these funds ensure that they are used as intended, preventing and reducing the risk of waste, fraud and abuse,” the Republicans' letter said.
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The unnamed congressmen told the Wall Street Journal that recent corruption revelations in Ukraine cast doubt on the Biden administration's assurances that aid had not fallen victim to bribery. Ukrainian President Volodymyr Zelenskyi recently fired a number of high-ranking officials after a journalistic investigation revealed that the Defense Ministry was paying inflated prices for military products. The publication notes that this is only one of many scandals related to procurement. The dismissals showed that Kyiv is capable of dealing with such cases, but also reminded of the long-standing Ukrainian problem of bribery.
Marchenko told the Wall Street Journal that military and budget aid from the US and other countries is closely monitored. But he acknowledged that Ukraine also needs to demonstrate progress in the broader fight against corruption to maintain the trust of its Western partners.
“We can show everyone who received money from American taxpayers. If we talk about the money of our international partners, it cannot be stolen. But our partners also want not a single hryvnia to be stolen from our own treasury,” the Ukrainian minister explained.
The Russian attack destroyed the Ukrainian economy, which shrank by 30% last year. Kyiv uses its tax revenue to pay for the needs of the war, and the US, the EU and other donors have agreed to help cover the civil deficit of Kyiv's budget.
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American financial assistance is tied to specific costs agreed upon by American and Ukrainian officials. The $15.5 billion that has been transferred so far has gone to pay salaries to Ukrainian teachers, doctors and rescue workers, as well as to support nearly two million internally displaced people and social assistance programs for vulnerable populations. The Wall Street Journal notes that there has not yet been a single specific case of misuse of American financial assistance. However, Ukraine's poor reputation creates challenges for supporting the country at a time when the cost of these efforts is rising.
Ukraine ranks 116th among 180 countries in Transparency International's corruption perception index. In Europe, only Russia ranks lower – 137th. The head of Transparency International's Kyiv office, Andrii Borovyk, told the Wall Street Journal that corruption in Ukraine is particularly widespread in the sphere of public procurement, issuance of state permits and appointments, privatization and court procedures. The country has made significant progress over the past decade in combating these challenges, including using digital technologies to increase the transparency of government actions. But, according to Borovyk, Kyiv still has a long way to go.
In his opinion, American aid during wartime is most likely well protected.
“I don't know how someone could steal or manipulate the money that goes to the salaries of government employees,” vid said, adding that US officials could verify this because everyone who receives a salary has a name and a tax number.
< p>Marchenko admits that Ukraine's broader corruption problem has not gone away because of the country's battle for survival.
“War is not just brave soldiers. Sometimes it is also corruption and greed of civil servants and officials. Many people can use war in their own interests. We need to convince the Congress and the people in the US not only with signals, but also with actions, that we are capable of handling American aid properly,” he said.
The Wall Street Journal explains that U.S. disbursements administered by the U.S. Agency for International Development mostly go through the World Bank, which combines those funds with bilateral contributions from other governments. USAID and the Deloitte Consulting company have also been monitoring the use of American financial aid since September.
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Marchenko said that Ukraine needs $38 billion in budget aid from international partners this year. The US promised to provide 10 billion, and the EU – another 19 billion dollars. Kyiv is currently negotiating with the IMF about a loan program that can help cover the remaining needs. Western financial aid is coming more regularly this year than in 2022, when the National Bank of Ukraine was forced to print money to keep the government afloat. Now the Ukrainian economy has stabilized, albeit at a depressed level, having withstood Russian attempts to destroy the country's energy infrastructure over the winter.
Borovyk from Transparency International believes that strengthening Western control over the actions of the Ukrainian government is useful.
“The fight against corruption in Ukraine is like a sandwich: international pressure from above and pressure from civil society from below is needed. This is how reforms take place,” he said.
We will remind you that previously ZN.UA published an investigation into the procurement of food by the Ministry of Defense for the army. The article says that the ministry has signed an agreement for 13 billion with a company with a charter capital of one thousand hryvnias. That is, during the war, the Ministry of Defense concluded an agreement with a “gasket” firm.
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