“…given the deeply corrupt nature of the entire Ukrainian state, it’s not at all clear that any of the benefits of gas development will trickle down to the population. Does anyone seriously think that local corruptioneers will permit villagers and townsfolk to make any money? Ditto for the Yanukovych regime in general and the Yanukovych Family in particular. It’s said that the oligarchs have stolen all there is to steal in Ukraine: not anymore. With potentially huge shale-gas profits, the opportunities for theft will only increase. Does anyone doubt that the president’s pals won’t divvy up the loot? Naturally, the money they steal won’t be invested in infrastructure or modernization of obsolete plants or education or housing. It’ll go to building more villas and buying more Mercedes and acquiring more property in Western Europe,” writes Motyl.
“…and most important perhaps, ample gas means “easy money” for the regime and corrupt, authoritarian regimes with easy money almost always become more corrupt and more authoritarian. When non-corrupt democracies come upon easy money, many benefit: consider Norway, Canada, Great Britain, and the United States. As the journalist Tina Rosenberg writes, “Every nation wants to strike oil, and after it happens, nearly every nation is worse off for it. It may seem paradoxical, but finding a hole in the ground that spouts money can be one of the worst things that can happen to a country.”
And consider Ukraine’s post-Soviet neighbors: Russia, Kazakhstan, Azerbaijan, and Turkmenistan. They all have huge oil and/or gas deposits and they are all consolidated dictatorships with extremely high levels of corruption,” notes the expert.
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He thinks that by this logic, the profoundly corrupt and increasingly authoritarian Yanukovych regime will use the easy money from shale gas to become even more profoundly corrupt and authoritarian, coming to rely even more on the forces of coercion to stay in power. Ukraine’s already uncompetitive economy will become even less competitive, and its population poorer. With growing popular anger at an illegitimate and repressive regime, the potential for a huge popular explosion will rise. As Rosenberg pithily puts it: “Petro-dependence also leads to conflict.”
“The moral for Ukraine’s democratic opposition should be clear. If they let Yanukovych win the 2015 presidential elections, he will be the beneficiary of easy money and Ukraine’s chances of experiencing a bloody breakdown will greatly increase. Or, to put it another way, whether or not Ukraine becomes Nigeria is now up to the EU and Shell on the one hand and Ukraine’s democratic opposition on the other,” Motyl summs up.
