Last week’s shoot-out in the sleepy Transcarpathian town of Mukacheve in western Ukraine has had a serious impact on the country's politics. In just one week, both the governor of Transcarpathia and top officials in the local security ministries have lost their jobs. Talk of a Third Maidan—even of a coup—has returned.

With several Rada deputies organising an investigative commission into the events at Mukacheve, both the law enforcement agencies and parliamentarians are now investigating what took place. In the past three days, Ukraine’s security services have searched 40 homes in the west of the country.

While Russian media has spoken of a ‘second front’ opening up in the conflict, Ukraine has discovered—to its shock—the scale of smuggling on its western border.

The first shot

Though the facts of this case are still being established, it seems that on 11 July, roughly 10 armed men from Right Sector, a prominent volunteer battalion, arrived at the Antares sports complex in Mukacheve to meet Mykhailo Lanyo, an MP from the Will of the People parliamentary group, and the owner of the sports complex. Viktor Baloga, another local MP, former political heavyweight and alleged funder of the local Right Sector group, was also supposedly present as a mediator (a fact Baloga has since denied).

As representatives of Right Sector and Lanyo spoke, a man, unconnected with either Right Sector or Lanyo (who is, allegedly, a local organised crime boss), was shot dead, and the Right Sector unit found itself in a stand-off with local police, who blocked off nearby roads suspiciously quickly.

Palanok Castle sits high above the town of Mukacheve. WikiMedia Commons / S Vetrov. Some rights reserved.Anton Gerashchenko (People’s Front), a member of the temporary investigative commission and adviser to the Interior Ministry, wrote that ‘according to Lanyo, the meeting with Roman Stoiko [Right Sector] lasted for 10 minutes before the fatal shot was heard. At the meeting with Stoiko, which was Lanyo's first, they had started to discuss the treatment of injured Right Sector fighters in Mukacheve’s sanatoria, and the country's political situation in general. After the shot was fired, his [Lanyo’s] assistant entered and said that one of the sports complex’s clients had been shot in the head. In the presence of Lanyo, Stoiko received information from his team that a man in the sports complex had provoked one of the Right Sector fighters.’

Following this incident, the Right Sector group decided to exit the complex in their armoured jeeps. Despite attempts by the local police chief to calm the situation, Right Sector fought their way out of the town, taking refuge in the surrounding hills. Shortly afterwards, two Right Sector fighters handed themselves over to the authorities.

Right Sector’s initial version of events put a fairly clear spin on what happened: ‘Hundreds of bandits, belonging to the rapist Regionnaire [Party of Regions] drug dealer Mikhailo Lanyo, who had gone crazy with impunity, tried to annihalate Right Sector fighters in the Transcarpathian town of Mukacheve.

'Bandits wearing police uniforms also played an active role in this operation, their wages paid by the odious godfather to the chief enemy of all Ukrainians: [pro-Russian oligarch] Viktor Medvedchuk. After the fierce battle, two Right Sector fighters are dead, and four – wounded (two of them seriously). Having collected the dead and the wounded, the unit broke out of the bandits’ encirclement and headed into the hills.’

At the time of writing, Ukrainian law enforcement agencies are still searching for the four missing Right Sector fighters. Sources in both Right Sector and the Interior Ministry have stated that the fighters are heading for the Slovakian border in the hope of crossing it. Though what really happened at Mukacheve is yet to be established,

Public officials, private interests

Several days after the firefight in Mukacheve, Petro Poroshenko appointed a new head of the Transcarpathian regional administration: Vasily Gubal was replaced by Gennady Moskal, former governor of Luhansk—a region dealing with its own problems of smuggling during wartime.

‘I have had to take urgent measures to put out the fire in Transcarpathia,’ said the president. ‘I have been forced to take Gennady Gennadievich Moskal, one of the best regional administrators, and send him to Transcarpathia.’

‘I have had to take urgent measures to put out the fire in Transcarpathia’ - Poroshenko

This appointment initially appears strange. Are the situations in Luhansk and Transcarpathia comparable?

After all, Transcarpathia is not only far from the fighting, but borders four EU member states: Hungary, Poland, Romania and Slovakia. What has made events in Transcarpathia that much more terrifying? Has peace suddenly been announced in eastern Ukraine?

Unfortunately not. The east, of course, remains in open conflict, and the reason behind Moskal’s appointment lies not in Transcarpathia, but the politicians who live there.

Members of Right Sector protesting outside the Presidential Administration in Kyiv following Mukacheve. (c) VisualRIAN.‘Moskal has two principal enemies: Viktor Baloga and his family,’ a people’s deputy from Poroshenko Bloc tells me. ‘With his two brothers Ivan and Pavel, they’re all people’s deputies now after being elected in local majoritarian constituencies. They have a cousin in parliament, Vasily Petyovka, who was also elected in Transcarpathia.’

Moskal, it should be said, is also no stranger to the region. Born in the neighbouring Chernivtsi, Moskal was head of the local Interior Ministry branch in 1997-1997, and later found himself in charge of the regional administration in 2001-2002. Indeed, Moskal and Baloga have a history: this is not the first time Moskal has replaced Baloga as governor.

Moskal has been a consistent critic of Baloga, particularly during the latter’s reign as head of Viktor Yushchenko’s Presidential Administration. ‘People complain to me that Baloga and his relatives have occupied the territory and are now, in effect, ruling Transcarpathia,’ said Moskal in 2008 during an attempt to unseat Baloga. ‘They’ve already started calling themselves the Family. That is, the Family has made a decision, the Family has appointed that man, don’t touch that business: the Family has decided that it belongs to them and so on. People ask me, where are we living, Ukraine or Sicily?’

After Mukacheve, supporters are demanding an end to the persecution of Right Sector. (c) Vitaliy Holovin / Demotix.Moskal is yet to say anything regarding the Baloga clan, though they have already made an advance statement: ‘Everyone, including me, expects the new head of the regional administration to wage a real war against organised crime and smuggling. We need to clear out the local police, put people in prison. The former governor did not have the authority to take such measures. Only people sitting in Kiev can do this. Not the people who silently consent to smuggling, but those who receive real money from it. From every pack of cigarettes, from every illegal migrant trying to get into the European Union, the trail leads directly to the capital.’

The issue here, of course, is that Viktor Baloga is suspected of controlling the region’s smuggling schemes, which run into the heart of the EU.

Border troubles

It is impossible to estimate the true scale of smuggling operations in Transcarpathia, which is home to some of Ukraine’s most important smuggling routes. Impossible, at least, for those not engaged in it.

After Mukacheve, all eyes are on Transcarpathia. Flickr/Victor Mazovsky. Some rights reserved.Everything is trafficked through Transcarpathia into the EU: amber, drugs, illegal migrants, tobacco.

As Konstantin Likarchuk, deputy head of the State Fiscal Service and the official in charge of customs issues, admits: ‘Everything goes over the western border. No single item dominates. The heads of the Hungarian and Slovakian customs offices are shocked by what’s going on with smuggling in Transcarpathia – we used to have a lot of collective projects. They’re even going to make an appeal to Brussels on this issue.’

It is impossible to estimate the true scale of smuggling operations in Transcarpathia

Indeed, before security was increased on the other side of Ukraine’s western borders, contraband goods could enter the country almost officially – via hidden compartments or by paying off border guards and customs officials.

At the same time, an alternative means of delivering goods has also developed: tunnels, the entrances to which are often hidden under small shacks or storage sites. In 2012, Slovakian border guards found one tunnel 700m in length: there was even a small railway inside. Slovak Finance Minister Peter Kazimir suggested that, with this kind of tunnel, the amount of excise tax evasion could reach up to 50m euros annually.

Another means of trafficking goods (frequently illegal cigarettes)—inside tree trunks—is particularly popular. A hole is carved inside the tree and cigarette packets, wrapped in polythene, are placed inside.

The profit to be made on cigarettes is sizeable. In Ukraine, the base price of a packet of cigarettes is $1 (65p), whereas in Europe, cigarettes cost no less than €3 (£2). A 20-tonne truck can take 11m cigarettes, or 550,000 packets, over the border. The profit from one such trip could reach £1.2m.

A very patriotic coup

Indeed, it was control over illegal trafficking of cigarettes, rather than political demands or a desire for justice and order, which led to the firefight in Mukacheve.

At least, that’s the theory of Mustafa Nayem, deputy head of Poroshenko Bloc in the Verkhovna Rada, and a popular journalist, who arrived in Mukacheve hours after the tragedy. Nayem spent several days there, trying to establish just what had happened.

‘The main item of illegal export is cigarettes,’ writes Nayem on his Facebook page. ‘People take the cheapest to Germany and Italy. The profits are astounding. One truckload of cigarettes leaving Ukraine for Italy brings in €470,000, after the necessary bribes at all the borders. Three to five 10-tonne trucks cross the border in one week alone.'

‘Local people tell me that the cigarette market is being re-divided. Some people are involved in organising, others get a cut for protection, and a third group guarantee the protection. The armed showdown happened because one party didn’t want to pay their whack. Several representatives of Right Sector received up to four dollars per crate. At one point, one of the smugglers said that they “had an arrangement in Kiev”.’

Gennady Moskal confirms Right Sector’s involvement in smuggling schemes: ‘I don’t care who it is, Right Sector or Left Sector. As the president said yesterday, the pseudo-patriotic slogans they use to cover their criminal activities are merely for show, to be used as extenuating circumstances. Wrapping yourself in the Ukrainian flag while moving against your fellow citizens or law enforcement agencies, with a gun in your hands – that is no extenuating circumstance. I want to ask the military commissar why, when the mobilisation plan is only at 28%, these guys aren’t fighting in the ATO [Anti-terrorist operation]?’

Naturally, Right Sector categorically denies any economic or criminal underpinning to their actions. They admit they have broken firearms laws, but cite the conflict in Ukraine’s east and the lack of real results in fighting smuggling as justification. But the volunter battalions cannot boast of any achievements in this area either.

Once the embodiment of Maidan’s final, crucial days, Right Sector are now losing popularity. The group cannot organise itself. Dmitro Yarosh, leader of Right Sector and the party of the same name, is concentrating on the fighting in eastern Ukraine. Yarosh is rarely seen in the Verkhovna Rada, and is not involved in legislative work despite being a member of parliament.

The lack of a clear chain-of-command has resulted in the appearance of militarised units who call themselves Right Sector, though they may have no relationship to the group. In the southern industrial region of Zaporizhya, for instance, three organisations simultaneously presented themselves as regional representatives of Right Sector.

The ideology and behaviour of Right Sector are radical. They are, it seems, the only political force which is ready to enter into direct armed conflict with President Poroshenko.

Cast your mind back to August 2014 when, after the police conducted searches of Right Sector activists, Dmitro Yarosh made serious threats: ‘If our demands [personnel changes in the Interior Ministry] are not fulfilled in 48 hours, we will be forced to remove all of our units from the frontline, declare a general mobilisation of reserve battalions and march on Kiev to carry out “speedy reforms” in the Interior Ministry.’ In those days, threats remained just that—threats. Nevertheless, Poroshenko continues to declare that he and the state are not in conflict with Right Sector.

Right Sector are the only political force ready to enter into direct armed conflict with President Poroshenko

There are grounds to believe that Right Sector will now come out with similar demands, and, perhaps, move from words to action. An urgent congress of Right Sector (and a people's rally on Independence Square) is planned for 21 July, during which, according to one of the group’s leaders, ‘we will make revolutionary decisions’.

Announcing the congress on 21 July, Yarosh made a highly unambiguous statement, calling on all of Ukraine’s military services and voluntary battalions ‘not to carry out the criminal orders of the speculators in power. While we spill our own blood defending the homeland, they make millions for themselves and do everything to make this war last as long as possible.

‘Together, we will stop the office-bound traitors on Bankova Street [location of the Presidential Administration], who wish to destabilise the situation in the rear, surrender our territories to the enemy, and destroy the volunteer movements. Down with the traitors!’

If acted upon, these calls for rebellion could lead to disaster, with a government elected by the people being replaced by a government elected by force. There is some room for manoeuvre, though: according to surveys, only 3% of Ukrainian citizens share the radical views of Right Sector. Unfortunately, firearms can quickly compensate for a lack of popular support.