What are the roots of corruption in Ukraine and how have the changing Ukrainian governments been addressing it?

The widespread corruption in Ukraine can be traced back to the country's Soviet past, but it does not represent a direct continuation of the Soviet tradition. The transfer of corrupt practices was more complex.

Because the Soviet “command economy” rejected free-market mechanisms of regulating the supply and quality of goods, Soviet citizens employed their own little strategies to obtain desired items. By far the most common of these involved finding a connection to somebody in the lower or middle ranks of the state's distribution chain. People cultivated such connections by returning favors or offering small gifts—something the state declared unacceptable, but in reality tolerated. Aware of its inability to satisfy consumer de­mand, the state actually maintained separate distribution networks for the elites, who also participated, from a much better position, in the informal “economy of favors."

Yet large-scale economic corruption, which became the plague of post-Soviet Ukraine, could not have existed under communist rule. With all enterprises under state ownership, a large unlawful property transfer simply could not take place. On several occasions in the postwar Soviet Union, the state made a point of sentencing to long prison terms or executing the organizers of larger informal networks, especially when these involved diverting the production of state factories through private channels.

It was rather a different kind of Soviet legacy that crippled Ukraine as well as Russia and some other post-Soviet states: the Communist Party's flagrant disregard for the rule of law and the absence of checks and balances. Its arbitrary exercise of power formed a widespread understanding that the political leaders could do anything they wanted, including in the economy, be­cause they were the real owners of the country, its economy, and the people.

The mismanaged transition from command economy to market mechanisms during the early 1990s produced widespread shortages of even basic necessities. This strengthened the pre-existing “economy of favors," which in the long run also became monetized to the extent that the price tags for essential services were announced openly, without much fear of the state. If underpaid Soviet doctors could expect from their grateful patients a box of chocolates or some return favor, many of their post-Soviet colleagues boldly named the amounts in US dollars, all the while as medicine remained the­oretically state funded. So, too, did state officials, college admis­sion specialists, vehicle-safety inspectors, and judges. Corruption thus became ubiquitous in its reach and was accepted by society as normal.

It took the Ukrainian state until 1995 to enact a rather basic law, “On the Struggle against Corruption,” which served to assuage the country's new allies and financial supporters in the West, just as the large-scale industry privatization under President Kuchma was about to produce stunning examples of large-scale corruption, collusion, extortion, and embezzlement involving the highest officials of the state. As experts have argued, the system constructed in Ukraine during the late 1990s was not just corrupt— it ran on corruption.⁷ The missions of the International Monetary Fund, now a major supporter of Ukraine's elusive reforms, and the embassies of the leading Western powers, found themselves pushing on behalf of Ukrainian society for the implementation of real anti-corruption measures.

Ukrainian civil society's rebellion against the system during the Orange Revolution of 2004-2005 created the first real opportu­nity to destroy the corrupt symbiosis of the state and the oligarchs. President Viktor Yushchenko clearly intended to use this mo­mentum. During his term in office, Ukraine signed the UN's and the Council of Europe's conventions against corruption and invited in­ternational monitoring of Ukraine's national anti-corruption meas­ures, primarily through the Council of Europe's Group of States against Corruption. Armed with the recommendations of inter­national experts, the Ukrainian authorities prepared a package of new laws and amendments, which would tighten up the existing legislative loopholes. Yet Yushchenko's continued infighting with his prime minister, fellow reformist Yulia Tymoshenko, delayed the passage of this legislation until 2009.

The next president, Viktor Yanukovych, representing the defenders of the old regime, inherited the so-called Anti-Corruption Package together with the promises made to Ukraine's Western partners, but his party disliked the proposed tighter controls over the role of state officials in economic decisions. The strategy they chose consisted of delaying the package's implementation and pressuring the Constitutional Court to declare that some parts of the package allegedly contradicted the Constitution. This allowed the Yanukovych government to abrogate the package in 2011 and, after leaving the country for several months with no anti-corruption legislation in place, it finally enacted a new law that was more ac­ceptable to party leaders and their cronies.⁸ To keep up appearances, Yanukovych also created the National Anti-Corruption Committee and promulgated the National Strategy for Combatting Corruption for 2011-2015.

Nevertheless, in 2012 Ukraine remained in the bottom part of the Transparency International corruption-perception index, ranking 144th of the 174 states surveyed. That same year, the global audit firm Ernst & Young ranked Ukraine, Colombia, and Brazil as the three most corrupt countries in the world, based on the percep­tion of international businesses.⁹ In 2013, the unchecked systemic corruption in Ukraine would become one of the main causes of the Euromaidan Revolution.