Ukraine: Current Issues and U.S. Policy
Steven Woehrel
Specialist in European Affairs
February 26, 2014
Congressional Research Service
7-5700
www.crs.gov
RL33460
Ukraine: Current Issues and U.S. Policy
Congressional Research Service
Summary
Many observers have expressed concern about Ukraine’s democratic development, including the
government’s use of the courts to neutralize opposition leaders, most notably former Prime
Minister Yuliya Tymoshenko, who was sentenced to a seven-year prison term in 2011. The
government’s effort in November 2013 to violently disperse pro-European Union protests
backfired, resulting in mass demonstrations in Kyiv and elsewhere in Ukraine. For over two
months, the government alternated between attempted crackdowns against the protestors and
conciliatory gestures. The most serious violence has occurred during and after a massive
government crackdown on February 18-20, resulting in at least 88 deaths, mainly among
protestors but also including some police officers. The violence led to a collapse in support for the
government of President Viktor Yanukovych, who fled from Kyiv, as did many of his supporters,
and the seizure of power by opposition parties, with the support of the protestors. The parliament
is expected to approve a new, pro-reform, pro-Western government by early March. The
parliament has scheduled new presidential elections for May 25, 2014.
Ukraine’s new government will face serious economic problems. Ukraine has long-standing
problems in attracting foreign investment, in part due to rampant corruption and other
shortcomings in the rule of law. Living standards for many Ukrainians remain low. In the near
term, the government’s dwindling foreign exchange reserves have raised the prospect of a default
on sovereign debt later this year, unless the government can secure new loans quickly.
The Obama Administration reacted positively, but cautiously, to the revolution in Kyiv, saying it
could be a step forward to the U.S. goal of a strong, prosperous, unified, and democratic Ukraine.
The Administration is working with the EU, the IMF, and other international financial
organizations to support a new Ukrainian government committed to reforms. Last year, the
Obama Administration requested $95.271 million in U.S. bilateral aid for Ukraine for FY2014.
President Obama and Administration officials have made statements that appear to be aimed at
dissuading Moscow from seeing the situation in Ukraine as a geopolitical competition between
the United States and Russia. However, this effort has met with limited success, judging by the
harsh public reaction from Moscow over the fall of the Yanukovych regime. Although it formally
expresses support for Ukraine’s territorial integrity, some experts have expressed concern that
Russia may take steps to “punish” the new leadership in Kyiv by imposing economic sanctions or
encouraging separatism in Ukraine’s Crimea region.
Congress has considered legislation on the current crisis in Ukraine. On January 7, 2014, the
Senate passed S.Res. 319. The resolution urges the United States and EU to work together to
promote a peaceful resolution of the crisis that moves Ukraine toward a future in the Euro-
Atlantic community and states that, in the event of further government violence against peaceful
protestors, the President and Congress should consider targeted sanctions, including visa bans and
asset freezes, against individuals responsible for ordering or carrying out the violence. On
February 10, 2014, the House approved H.Res. 447. The resolution is broadly similar to S.Res.
319. The resolution expresses support for the visa bans that the United States has already imposed
on Ukrainian officials responsible for violence against protestors, and urges the Administration to
consider additional sanctions against those responsible for the use of force.
After the collapse of the Yanukovych regime in February 2014, congressional action may shift
from a focus on possible sanctions to how the United States should aid the new Ukrainian
government to achieve stability and conduct reforms.
Ukraine: Current Issues and U.S. Policy
Congressional Research Service
Ukraine: Current Issues and U.S. Policy
Congressional Research Service
Contents
Background ...................................................................................................................................... 1
Current Political Situation ............................................................................................................... 3
Current Economic Situation............................................................................................................. 5
Ukraine’s Foreign Policy ................................................................................................................. 6
European Union ......................................................................................................................... 6
Russia ........................................................................................................................................ 7
Energy Issues ....................................................................................................................... 9
U.S. Policy ..................................................................................................................................... 10
U.S. Reaction to Anti-Government Protests ............................................................................ 10
Congressional Response .......................................................................................................... 12
U.S. Aid to Ukraine ........................................................................................................... 12
Other Legislation ............................................................................................................... 13
Policy Issues ............................................................................................................................ 13
Contacts
Author Contact Information........................................................................................................... 14
Ukraine: Current Issues and U.S. Policy
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Background
Ukraine, comparable in size and population to France, is a large, important, European state. The
fact that it occupies the sensitive position between Russia and NATO member states Poland,
Slovakia, Hungary, and Romania adds to its geostrategic significance. Many Russian politicians,
as well as ordinary citizens, have never been fully reconciled to Ukraine’s independence from the
Soviet Union in 1991, and feel that the country belongs in Russia’s political and economic orbit.
The U.S. and European view (particularly in Central and Eastern Europe) is that a strong,
independent Ukraine is an important part of building a Europe whole, free, and at peace.
From the mid-1990s until 2004, Ukraine’s political scene was dominated by President Leonid
Kuchma and oligarchic “clans” (groups of powerful politicians and businessmen, mainly based in
eastern and southern Ukraine) that supported him. His rule was characterized by fitful economic
reform, widespread corruption, and a deteriorating human rights record.
Ukraine’s 2004 presidential elections were marred by electoral fraud, which triggered massive
street protests. The oligarchs chose Prime Minister Viktor Yanukovych as their candidate to
succeed Kuchma. The chief opposition candidate, former Prime Minister Viktor Yushchenko, was
a pro-reform, pro-Western figure. After a November 21 runoff vote, Ukraine’s Central Election
Commission proclaimed Yanukovych the winner. Yushchenko’s supporters charged that massive
fraud had been committed. Hundreds of thousands of Ukrainians took to the streets, in what came
to be known as the “Orange Revolution,” after Yushchenko’s chosen campaign color. They
blockaded government offices in Kyiv and appealed to the Ukrainian Supreme Court to invalidate
the vote. The court did so and set a repeat runoff vote. Yushchenko won the December 26 re-vote,
with 51.99% of the vote to Yanukovych’s 44.19%.
The “Orange Revolution” sparked a good deal of interest in Congress and elsewhere. Some hoped
that Ukraine could finally embark on a path of comprehensive reforms and Euro-Atlantic
integration after years of half-measures and false starts. However, subsequent events led to
disillusionment among Orange Revolution supporters, both in Ukraine and abroad. President
Yushchenko soon fell into squabbling with Yuliya Tymoshenko, his main backer during the
Orange Revolution and his first prime minister. Yanukovych, who also served briefly as prime
minister during this period, also was involved in this infighting. As Ukrainian leaders engaged in
this three-sided political battle, an overwhelming majority of Ukrainians grew disgusted with the
Ukrainian political class, according to opinion polls.
What little remained of the ideals of the Orange Revolution came to an end with the victory of
Yanukovych over Tymoshenko in the presidential election of February 2010. Yanukovych won
48.98% to Tymoshenko’s 45.47%. As in past elections, the results showed a sharp regional split,
with Yanukovych winning in Russian-speaking eastern and southern Ukraine, while Tymoshenko
prevailed in central and western Ukraine, where Ukrainian nationalism is stronger. International
monitors praised the conduct of the election.
Yanukovych’s government was criticized over its human rights record. In particular, U.S. and EU
officials expressed strong concern over the government’s targeting of opposition leaders for
selective prosecution. In the most prominent case, in October 2011 Tymoshenko was convicted of
abuse of power arising out of her role in signing a natural gas supply agreement with Russia and
sentenced to seven years in prison. Ukraine’s October 2012 parliamentary elections fell short of
international standards, according to international election observers.
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After the elections, the Party of Regions was able to form a working parliamentary majority with
the help of the Communist Party and independent deputies. Ukrainian commentators noted that
the new government formed after the election included several new figures that were part of the
personal entourage of the President and his son, Oleksandr (colloquially known as “the Family.”)
These analysts claimed that these moves marked the “Family’s” consolidation of political power,
which has in turn assisted the group’s ongoing efforts to seize control of a large share of
Ukraine’s economic assets.
Until a few months ago, many observers have believed that, despite growing dissatisfaction with
the government, there was little likelihood of public unrest in Ukraine, given widespread
disillusionment with the outcome of the Orange Revolution. However, this situation changed
suddenly in November 2013. On November 21, the government made a last-minute decision to
not sign an Association Agreement with the European Union, due to Russian pressure. The about-
face sparked anti-government demonstrations. The first demonstrations in Kyiv in late November
were relatively modest in size.
However, on November 30, Ukrainian special police attacked and viciously beat peaceful
protestors (many of them young people) in Kyiv’s central Maidan Nezalezhnosti, or
Independence Square. The action outraged many Ukrainians, and resulted in a massive upsurge in
participation in the protests in Kyiv. Smaller protests occurred in other Ukrainian cities, mainly in
opposition strongholds in western and central Ukraine. According to some observers, the turnout
in Kyiv at times even exceeded those during the Orange Revolution.
Observers noted that demonstrators were not just protesting against Ukraine’s failure to sign the
Association Agreement, but against the government’s lack of respect for the basic human dignity
of Ukraine’s citizens, as exemplified in the November 30 beatings, but also in other areas, such as
the rampant corruption among government officials. An attempt by riot police to clear the square
on December 10 failed due to the resistance of the protestors.
By mid-January, the Maidan protests were continuing, but with fewer protestors than at their peak
in early December. Perhaps seeing a chance to “restore order,” on January 16, the Party of
Regions and its allies in the Ukrainian parliament rapidly approved, by a show of hands, a series
of laws sharply increasing criminal penalties for many of the activities associated with the
protests, such as seizing public buildings, wearing helmets, setting up tents or a stage, etc.
Another law requiring all organizations receiving foreign funding to register as foreign agents
appears to be based on a similar Russian law.
The new measures were fiercely condemned by the opposition parties and the protestors as the
“dictatorship laws.” After their adoption, violence between the most militant of the protestors and
police increased sharply. At least four persons were killed in the violence, while scores of others
were brutalized by police. Several government ministry buildings in Kyiv were either blockaded
or seized by protestors. In addition, protestors seized control of or blockaded government
buildings outside of Kyiv, mainly in western and central Ukraine, but also in some places in the
east. After this setback, the government again appeared to adopt a strategy of backpedaling and
playing for time. On January 28, Prime Minister Mykola Azarov resigned. On the same day, the
Ukrainian parliament voted to repeal the “dictatorship laws” and adopted a law to give amnesty to
the protestors.
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Current Political Situation
After pausing for several weeks to gather its
forces once again, on February 18 the
government embarked on its most violent
crackdown attempt against the Maidan, one
that quickly resulted in the regime’s own
demise. Elite “Berkut” riot police attempted to
clear protestors from the Maidan and other
areas of Kyiv, with the support of roving
gangs of street thugs hired by the government.
88 persons, mostly protestors but also some
police officers, were killed on the 18th, 19th
and 20th. Many hundreds more were injured.
Many casualties were caused by firearms,
mainly used by the police, including by
snipers. The government reportedly had plans
to use snipers much more extensively and also
unsuccessfully tried to order the army to join
the crackdown.
The death toll may have caused support in the
Ukrainian parliament for the crackdown and
the regime to collapse. On February 20, it
approved a resolution calling for the pullout of
the Interior Ministry and military forces from
Kyiv to their bases and a ban on the use of
firearms. Of the 450-member body, 239 were
present for the vote; 236 voted for the
resolution. Once the police and military
complied with the resolution, groups of
protestors seized key government buildings.
Yanukoyvch and scores of his supporters in
the government and parliament fled the capital
by the 21st, many heading for the eastern and
southern parts of the country, while others
continued into Russia.
The Ukrainian parliament, now composed
mainly of opposition deputies, has rapidly passed sweeping measures with little or no opposition.
The parliament deposed Yanukovych as President on February 22 for abandoning his duties. On
the same day, Yuliya Tymoshenko was released from prison. Oleksandr Turchynov, a long-time
top aide of Tymoshenko, was elected as speaker of the parliament, replacing the resigned
incumbent from the Party of Regions. The parliament also voted to make Turchynov acting
president until new presidential elections are held, which the parliament set for May 25. The
parliament restored the provisions of the 2004 Ukrainian constitution, eliminating changes made
by Yanukovych to strengthen the presidency. Ex-President Yanukovych and dozens of other top
officials of the former regime are being sought by police for their part in killing and injuring
Maidan protestors and other regime opponents. Yanukovych was last seen in Crimea, and his
Key Parties in Ukraine’s Parliament
Party of Regions: Until February 2014, the party of the
ruling regime and by far the largest faction in the
Ukrainian parliament. It has drawn its support from
eastern Ukraine, where suspicion of Ukrainian
nationalism is high and support for close ties with Russia
is strong. It defends the economic interests of powerful
oligarchic business groups. Since the collapse of the
Yanukovych regime in February 2014, scores of deputies
have fled from Kyiv or left the party, with most of the
rest apparently unwilling or unable to offer serious
resistance to the new leadership, at least for now.
Fatherland: Founded by Yuliya Tymoshenko, Fatherland
has run on a populist, anti-corruption platform. It draws
its support from western and central Ukraine, where
Ukrainian nationalism is strongest. After the collapse of
the Yanukovych regime in February 2014, Fatherland
effectively became the leading faction in Ukraine’s
parliament.
Ukrainian Democratic Alliance for Reform
(UDAR): Founded by heavyweight boxing champion
Vitali Klitchko (the acronym “UDAR” means “punch” in
Ukrainian), UDAR relies chiefly on the personal
popularity of Klitchko. Its platform, while expressing
opposition to the former regime’s corruption, has been
criticized for lacking in specifics.
Freedom: A party espousing extreme Ukrainian
nationalism and economic populism, Freedom receives
its support from western Ukraine, where Ukrainian
nationalism is strongest. Some observers have attributed
its success to disillusionment with the Fatherland and
other opposition groups rather than a surge in support
for extreme Ukrainian nationalism. Its activists played a
key role in fighting against riot police in the Maidan
protests. The party is led by Oleh Tyahnybok.
Communist Party: The Communist Party has been
overtaken by the Party of Regions in its eastern Ukraine
strongholds and has a largely elderly electorate. It
opposes market economics and favors strong ties to
Russia.
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present whereabouts are unknown. Meanwhile, Yanukovych-appointed governors and other local
officials have resigned in many regions of Ukraine, although mainly in western and central
Ukraine.
The parliament has dismissed the members of the former government, and parties in the
parliament are putting together a “government of national trust” to govern the country, at least
until a new president is elected. The proposed choices for a new government were presented to a
crowd of tens of thousands in the Maidan on February 26. They include both representatives of
the opposition parties and Maidan activists. Fatherland leader Arseniy Yatsenyuk was nominated
as Prime Minister.
Ukraine’s new government will face serious political challenges. One is maintaining the support
of the social and political forces that have emerged from the Maidan. Throughout the protests, the
opposition parties have been playing catch-up with sentiment on the streets. Observers have
witnessed expressions of scorn at times from demonstrators as opposition party leaders spoke at
the Maidan. On February 21, the foreign ministers of Poland, Germany, and France brokered an
agreement between the regime and the main opposition party leaders that appeared to Maidan
protestors to all