This publication is part of Carnegie’s Reforming Ukraine project and is supported in part by grants from the Center for East European and International Studies (Zentrum für Osteuropa- und internationale Studien, ZOiS) and the Open Society Foundations.

Ukraine is undertaking comprehensive reform of its armed forces, necessitated by conflict in the east of the country. The combat-hardened army now fighting in the Donbas region bears little resemblance to the one that suffered heavy losses when fighting with Russian-backed separatists first broke out in 2014. The country’s armed forces are larger and better equipped than ever before, numbering 200,000 active-service military personnel.1 The military budget is set to rise by more than one-quarter in 2018. And, just as importantly, morale has improved.

Ukraine’s government has committed to major structural reforms to ensure that its armed forces meet NATO standards by 2020, a crucial step toward the country’s goal of NATO accession. Yet almost no one believes that it can meet this deadline. Major problems remain, all of which stem from Ukraine’s internal political struggles and the continuing weakness of state structures. They include: lack of internal coordination between structures; lack of civilian and parliamentary oversight of the armed forces; incomplete integration of volunteers into the regular army; impunity and abusive behavior in the conflict zone; and systemic corruption and nontransparency of budgets, especially in the Ukroboronprom state-owned defense-industry monopoly.

Western governments are the main financiers of the military reform effort. In theory, this should give them leverage over Kyiv. In practice, the political imperative to support Ukraine against Russian aggression may take precedence over harsh conditionality. How Western donors handle this process will be key to Ukraine successfully reforming its military and enhancing its national security.

A New Army

Within a short space of time, Ukraine’s army has evolved from a depleted, neglected, and underfunded force to one that has contained a Russian-backed armed rebellion in eastern Ukraine. The transformation has been painful and an enormous amount still needs to be done to reform the Ukrainian military, but remarkable progress has been made since 2014.

Following the 2013–2014 Euromaidan uprising that ended the rule of former president Viktor Yanukovych, the new authorities in Kyiv inherited an army in a dire state. A 2012 newspaper headline summarized the consensus view of Yanukovych’s plans for radical cuts to the army by saying, “Ukrainian army reform [means] capitulation to Russia.”

Valeriy Akimenko Valeriy Akimenko has twenty-five years of experience working for BBC Monitoring, reporting first on Ukraine and then on Russia, and specializing in the military and security.

In 2014, Chief of the General Staff Viktor Muzhenko described the situation as “an army literally in ruins, Russian generals at the head of [Ukraine’s] armed forces and security agencies, total demoralization [in the armed forces] - those were basically the conditions under which Ukraine met Russia’s aggression.” This miserable state of affairs was confirmed when around 70 percent of the Ukrainian forces stationed in Crimea swore allegiance to Moscow following Russia’s annexation of the peninsula.

The problems go back to the first years of independence after 1991. Muzhenko argued that under every president and government, the Ukrainian army had been funded at—at most—only half of the minimum requirements, which had “in effect led to the loss of combat readiness in the armed forces.” He said that 75 percent of all equipment being used by the armed forces was more than twenty years old and had grown technologically and physically obsolete.

After Russia’s rapid seizure of Crimea, the next challenge in the spring of 2014 was the gradual escalation of hostilities in eastern Ukraine. The number of well-trained professionals available was alarmingly small. The government in Kyiv at least had more time to adapt, using the window provided by the first Minsk ceasefire in September 2014 to recruit more personnel to Ukraine’s armed forces and national guard. Partial mobilization, carried out in three waves in 2014 and three more by August 2015, was the main source of manpower. In total, more than 100,000 personnel were mobilized. Conscription was also reinstated, with the term of service set at eighteen months.

Ukraine suffered heavy losses, both civilian and military, in the conflict. According to international figures, the overall death toll passed 10,000 in 2017. The General Staff’s official data on Ukraine’s military losses is a combined total of 10,710, including 2,333 killed and 8,377 injured. Other sources give much higher figures.

On the ground, the thrust of military reform is to professionalize the armed forces, set up new units, boost the combat capabilities of the existing units, and develop the reserve system. This is part of Ukraine’s overall stated plan to move the management of its military toward the NATO model by 2020, with steps such as structural reform of the General Staff in line with NATO’s J-structure of joint staffs.

One military expert, Oleksandr Danylyuk, says bluntly that there is “not a chance” of this deadline being met. “Both the Ukrainian side and our Western partners still lack a holistic vision of both the reform effort itself and (as a logical consequence) its implementation,” he says.2 Colonel Ivan Yakubets, former commander of Ukraine’s Air Assault Forces, recalls that since most of the current top brass presided over the degeneration of Ukraine’s armed forces prior to 2014, he doubts they are capable of delivering reforms.

Even without political considerations, Ukraine’s armed forces face the challenge of growing pains and coordination to manage the transformation. In early 2015, Ukrainian President Petro Poroshenko decreed an increase in the maximum size of the military from 184,000 to 250,000. As of 2016, Ukraine was thought to have more than 200,000 active-service military personnel, including 145,000 in the army, 45,000 in the air force, 8,000 in the commando force, and 6,000 in the navy.

The army includes the national guard, which was formed in 2014 from the Interior Ministry’s Internal Troops. Though classified as a paramilitary force, the national guard is effectively part of Ukraine’s armed forces. It, too, has fought in the east and is equipped with armored vehicles, artillery, antitank and anti-air weapons. Its numerical strength is estimated at more than 50,000.

As the conflict escalated, the decision was made to build up reserve forces in the eventuality of a full-scale military invasion. The country now has a tiered system of military reserves, comprising an estimated total of 900,000 reservists who have served “within [the past] five years.” The General Staff is looking to recruit officers from these sizeable reserves to address its shortage of officers.

Overall coordination of these old and new military forces is reportedly very poor. As the Ukrainian government launched what it called an “anti-terrorist operation” in the east in 2014, reports abounded of a “lack of coordination and joined-up command” being “one of the operation’s main problems.” There are still reports of distrust between frontline units and the high command, a problem compounded by an overall shortage of competent officers. An urgent priority is to improve the functioning of the Joint Operational Headquarters as an interservice agency for joint operations.

Coping With Volunteers

The Armed Forces of Ukraine turned around a disastrous situation in the 2014 conflict thanks to the help of volunteer fighters. But even after an active process of absorption, their full integration into the regular army remains a challenge.

“In the spring and summer of 2014, volunteer battalions saved Ukraine’s independence,” Andriy Parubiy, the chairman of the Ukrainian parliament, or Rada, told members of parliament in January 2017. At the same time, Defense Minister Stepan Poltorak characterized 40,000 of the men fighting in the east as volunteers who signed up on contract without being mobilized into the army.

Conservative estimates put the number of volunteers who fought in the east at 15,000 in as many as fifty units—among them the well-known Azov, Donbas, Dnipro, and Tornado units—many of which emerged during or around the Euromaidan uprising. The Russian media has applied especially poisonous epithets (such as “punitive,” “little Nazis,” or “neo-Nazis”) to these armed groups.

The government says that the difficult process of making these volunteers into regular soldiers is almost complete, but this is hard to verify. According to one commentator, the volunteer units can “no longer be used as a third party which individual politicians could use to try to seize power.” Even so, lesser dangers persist, such as the potential for business tycoons to use volunteer forces as small private armies to settle corporate raiding disputes and seize the assets of their rivals. At the same time, the government is reluctant to do anything that jeopardizes its fight against the Russian-backed insurgency, and the volunteers still enjoy warm public support.

Various volunteer units have had different fates since the most active phase of their conflict. The well-known Azov Regiment (originally a battalion), which is credited with a key role in the recapture of Mariupol in June 2014, is seen as an example of successful integration. The regiment has become part of the Interior Ministry and its first commander, Andriy Biletsky, is now a member of parliament.

The main example of a unit that has failed to integrate is the Right Sector Volunteer Ukrainian Corps (DUK PS). This feared and notorious group was prominent during Euromaidan and is well-known for its extreme nationalist views. According to a 2016 account from an authoritative source, the DUK PS categorically refused to amalgamate with the armed forces. An internal schism, with large numbers of the DUK PS under its leader, Dmytro Yarosh—now a member of parliament—splitting away to form the Ukrainian Volunteer Army, which has maintained de facto autonomy. Commentators say that the DUK PS has retained a high level of discipline and coordinates with military command in the combat zone. Yet it remains technically outside the law and is able to demonstrate political muscle, of the kind illustrated by the role of volunteers in the 2017 economic blockade of Donbas, which began as an unofficial process before being authorized by the government.

Other volunteers are believed to have turned to crime. “On the one hand, [the volunteers] are revered veterans who saved the motherland, on the other hand they break the law and hurt the economy of the country at a time of war and they are a source of attraction to adventurers and bandits,” says one report. With as many as 5 million illegally held small arms in Ukraine, up from an estimated 3 million before the war, this shift toward criminality is an obvious cause for concern.

The lack of a clear legal status for some groups still serving in the eastern conflict zone compounds another problem: reports of human rights abuses in Ukrainian government–controlled territory.

The military operation in eastern Ukraine has been formally called an anti-terrorist operation since 2014, which has allowed the Ukrainian authorities to avoid using the word “war” and made it easier for them to receive International Monetary Fund loans. This means that the security services, not the military high command, are technically in charge of the operation.

Although reports conclude that the most egregious human rights abuses have been committed in the non-government-controlled regions run by the so-called people’s republics—the Donetsk People’s Republic and Luhansk People’s Republic—they have also registered many abuses in government-controlled areas. Human Rights Watch recorded that both the Russian-backed separatists and the Ukrainian government authorities have held civilians in prolonged, arbitrary detention, and that “most of those detained suffered torture or other forms of ill-treatment.” A June 2016 report by the UN Office of the High Commissioner for Human Rights stated that “enforced disappearances, arbitrary detention, torture and ill-treatment remain deeply entrenched practices,” both in the territories controlled by the armed groups and in the territories controlled by the government. The report notes that, in the early part of the conflict, most of these abuses were attributed to members of volunteer battalions, but that the more recent allegations “mostly implicate SBU [the Ukrainian security services].”

The lack of parliamentary oversight of the so-called anti-terrorist operation has made it harder to hold to account those accused of crimes committed in government-controlled territory. Though this changed with the adoption of parliamentary bill No. 7163 on the reintegration of the Donbas region, human rights groups are unhappy with other provisions included that they say will strengthen the role of the president vis-à-vis parliament.

Oversight and Transparency

Insufficient civilian oversight of Ukraine’s armed forces and security services is a constant refrain from those urging the country to carry out effective security sector reform.

Ukraine has largely preserved the Soviet-era tradition of having military professionals fill the higher ranks of the Defense Ministry. The current minister, Stepan Poltorak, who was appointed in October 2014, previously served as the commander of the national guard. “The absence of a civilian cadre within the MoD [Ministry of Defense] staff is highly problematic from the perspective of democratic control of the defence sector, since in theory it makes the MoD more likely to take a military approach to problem solving involving security matters than a political approach,” argues a 2015 report by the Swedish Defense Research Agency.

As part of the reforms it pledged to undertake by 2020, the Ukrainian leadership has committed to appointing a civilian defense minister and other key senior defense officials in 2018. Civilian control of the military is also a provision of the five-year U.S.-Ukraine Partner Concept.

The issue of oversight is especially acute when it comes to scrutiny of the rapidly growing defense and security budget, which was $2.7 billion in 2013 and is set to top $6 billion (more than 6 percent of Ukraine’s GDP) in 2018.

Anticorruption NGO Transparency International describes civilian control, including by the Rada through relevant parliamentary committees, as “weak.” Neither the annual procurement State Defense Order nor the “Priority Directions,” which outline security assistance needs, are subject to parliamentary oversight. Yet parliamentary oversight by itself would not be sufficient, as some members of the Rada’s Defense Committee are also accused of corruption. For there to be public trust in the efficiency of defense spending, the donor community and NGOs must be allowed to inspect the figures.

Restructuring a Monster

Alarm bells sound especially loud regarding the lack of external oversight and transparency of Ukraine’s defense procurement process. As a RAND study argues, “The system of tender committees that do not include procurement professionals facilitates corruption and inefficiency. Individuals with ties to the defense industry can guide contracts to favored suppliers without taking responsibility for the decision.”

The problem is exacerbated by the fact that one state-owned conglomerate, Ukroboronprom—variously referred to as a “monster” and a “parasite”—enjoys a de facto monopoly over Ukraine’s defense industry. The Independent Defense Anticorruption Committee (NAKO), an independent anticorruption watchdog set up in 2016 by Transparency International to monitor Ukraine’s security sector, announced in December 2017 that it was ceasing cooperation with Ukroboronprom “due to the failure of the government and presidential administration to make progress in establishing an independent supervisory board.”

Founded in 2010, Ukroboronprom is now a conglomerate of 130 companies with a workforce of some 80,000. It has subsumed almost the entire defense industry of Ukraine across sectors as diverse as ammunition, electronics, motor vehicles, artillery, tanks, aircraft, shipbuilding, and missile manufacture. Data about Ukroboronprom’s budget is elusive. Its 2016 revenue reportedly totaled just over $1 billion.

Following Yanukovych’s ouster in 2014, Roman Romanov, a politically controversial figure, was appointed to head Ukroboronprom. Under Romanov, Ukroboronprom has been linked to Serhiy Pashinsky, the head of the parliamentary National Security and Defense Committee in the Rada, and has been called “Pashinsky’s and the People’s Front milch cow” (the People’s Front is a political party that is part of the government coalition). Other observers, however, talk of Ukroboronprom’s “close ties to the country’s president.” In December 2017, Prime Minister Volodymyr Groysman called for him to be dismissed for failing to pay workers’ wages. He was removed by Poroshenko on February 12, 2018, after Romanov claims to have tendered his resignation.

Retired lieutenant general Timothy Evans, one of three international members of NAKO, calls Ukroboronprom an “enigma” and charges, “Research suggests that the MoD might base its requirements not on a needs assessment, but rather on Ukroboronprom’s ability to produce particular items - which is the opposite of what should occur.”

Ukroboronprom has repeatedly faced accusations of corruption. A 2017 report written by Ukraine’s embattled anticorruption commission and provided to Foreign Policy alleges that officials at Ukroboronprom siphoned off funds from a $39 million contract to supply parts for Antonov AN-32 aircraft to the Iraqi Defense Ministry. Another case involves a Poroshenko company that has had to issue a denial after reports emerged that four armored vehicles had been supplied to the State Border Guard Service in 2015 at inflated prices.

Experts have advocated various reforms of Ukroboronprom, including privatization and the appointment of an independent board. Others, such as former U.S. deputy assistant secretary of defense Michael Carpenter, say that more radical change is needed and the companies making up the conglomerate should be “restructured and spun off.”

A Challenge to Western Donors

Ukraine’s Western partners have been key players promoting military reform. Commentators attribute higher levels of professionalism in large part to trainings by instructors from the United States, United Kingdom, Canada, and other Western countries.

Further training by these partners will be key to a successful transformation in the reform process. The expert consensus is that this is especially required at the higher levels of the armed forces and in effecting a complete overhaul of Ukraine’s strategic, operational, and tactical capabilities.

The next step Western partners are considering is how to help level the playing field to strengthen Ukraine’s capacity to defend itself. This is especially needed in command, control, communications, computers, intelligence, surveillance, and reconnaissance; electronic warfare; anti-UAV capacity; counterbattery fire; and antitank weapons, as deterrents against the resumption of full-blown hostilities.

Defense provision needs to be considered within the overall context of aid for Ukraine’s larger reform efforts. The United States, Ukraine’s largest military assistance provider, has pledged a large aid package of up to $350 million for the country’s military in the 2017 National Defense Authorization Act (NDAA). However, expenditure is limited to $175 million until it can be shown, through certification by the secretaries of state and defense, that Ukraine has engaged in “substantial actions to make defense institutional reforms.” The reforms called for are among those cited in this article, including civilian control of the military, increased transparency and accountability in defense procurement, and measures to tackle corruption.

According to Transparency International, “if implemented well, the NDAA could be used as leverage to press Ukrainian defence leaders to conduct difficult systemic reforms that could drastically improve defence governance.” Yet there are reasons to doubt whether this application of conditionality will achieve the desired results. The time frame for decisionmaking is short and the U.S. Department of Defense is traditionally hesitant to withhold funds it has already promised. Most importantly, there are strong political pressures in Washington to assist Kyiv in its conflict with Moscow no matter what.

These pressing political dilemmas overhang the issue of reforming Ukraine’s defense sector. As with other areas urgently requiring reform, the only sure guarantee of success is a strong commitment to change from within Ukraine’s own society.

Valeriy Akimenko has twenty-five years of experience working for BBC Monitoring, reporting first on Ukraine and then on Russia, and specializing in the military and security.

The author wishes to thank Keir Giles for his valuable comments on a draft of this article and is especially grateful to Thomas de Waal, who was the source of many important ideas throughout the writing process.

Notes

1International Institute for Strategic Studies, The Military Balance 2016 (London: International Institute for Strategic Studies, February 9, 2016).

2Email correspondence with Oleksandr Danylyuk (head of the Ukrainian Center for Defense Reform), December 6, 2017.