Ukraine oligarchs lose wealth owing to warfare

Ukraine’s top oligarchs lost significant wealth owing to the warfare in east Ukraine, reported Forbes magazine on March 2 as part of its rankings of the world’s wealthiest people. The wealth of Rinat Akhmetov, who owns a sizable chunk of the industrial assets of the Donbas region, was estimated at USD 6.7 bln in 2014, a plunge of USD 5.8 bln from the prior year. The wealth of Victor Pinchuk was USD 1.5 bln, a drop from USD 1.7 bln. Privat Group partner Igor Kolomoisky’s wealth was USD 1.3 bln, a decline of USD 800 mln, and his partner Gennady Bogolyubov’s wealth was USD 1.3 bln, a drop of USD 1 bln. The wealth of MHP major shareholder Yuriy Kosyuk was USD 1.1 bln, a decline of USD 400 mln.

Zenon Zawada: It’s revealing that Ukraine’s wealthiest people couldn’t organize themselves so as to prevent the outbreak of warfare and destruction of their wealth. Since the outbreak, only Kolomoisky has organized a defense, forming volunteer battalions to defend the Dniproptrovsk region, where most of his industrial assets are located. Kosyuk served in the Presidential Administration in 2014 as part of a short-lived experiment. Pinchuk has stayed on the sidelines. Not only did Akhmetov fail to prevent the separatist insurgency, but he is widely suspected of supporting it, which only blew up in his face when they turned on him. His relations with the separatists at present are unclear.

All this speaks to the Ukrainian oligarchy, as it evolved in the last two decades, being an inadequate economic model for the Ukrainian state. With a few exceptions, the oligarchs demonstrated that they’re merely interested in defending their own separate fiefdom and incapable of acting in the national interest, which required at minimum a military defense against a foreign invader. Once the warfare is over, the Ukrainian state and economy will be reconstructed. Whatever role the oligarchs will take in that reconstruction, it will have to be adjusted so that the state’s interests take precedence over theirs. Had they realized the benefits of a strong state, such as a common military defense, they could have avoided such economic ruin.