Many expected 2019 to be the breakthrough year in terms of establishing some kind of peace in occupied Donbas and beginning the reintegration of ORDiLO, as the occupied rayons or counties of Donetsk and Luhansk Oblasts are called, into the rest of Ukraine. Such hopes failed to materialize. Now, with the beginning of 2020, it’s obvious that the new administration has been unable to achieve any serious progress in this much-promised area. The war continues, and it doesn’t look likely to stop any time soon. Despite agreements to exchange prisoners and withdraw troops from some areas of the front, the Ukrainian Armed Forces continue to report casualties every week.
The absence of serious progress in peace talks is no fault of the Zelenskiy administration. It’s long been obvious that the war would continue until Russia decides to stop. And no Ukrainian leader, however persuasive, will be able to do anything about this unilaterally. After all, Ukraine was not the attacker in this conflict: it’s the defender. Moreover, it will have to keep doing so until the aggressor removes its troops from Ukrainian territory.
Turns out that easy promises of peace were a mistake on the part of Volodymyr Zelenskiy. His predecessor, Petro Poroshenko, found himself in exactly the same unpleasant position, having promised to end the ATO in a few weeks, back in 2014. Later, he had to apologize for his words but the sour taste remained. Most likely, this will prove equally awkward for Zelenskiy down the line.
And so 2019 turned out to be another lost year for occupied Donbas, a time of continuing armed conflict, destruction, lawlessness, economic collapse, and curfews. Every such lost year separates the region more and more from normal life, and makes its economic revival in the near future less and less likely. Although many of those living in ORDiLO are aware that they are in a dead end, they are in no position to do much about it at this point. The only option for locals who want to change their lives is to simply leave the area and the rule of brigands who call themselves the leaders of the two pseudo-republics, DNR and LNR. This is about the only leverage they have over their own lives.
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The deliberate collapse of the economy and social sphere in ORDiLO continues unabated. Driven not only by the uncertain status of the grey one or the lack of opportunities for the economy to properly develop, but also by the open marauding of the current “overlords” of the territories. Ukrainian businesses have been seized and handed over to the one-time Yanukovych bagman and junior oligarch, Serhiy Kurchenko, who now lives in the Russian Federation, and runs these stolen assets through his Vneshtorgservis company. What’s more, Kurchenko exploits all these assets in the most barbaric fashion, running them into the ground without investing in any necessary reconstruction or modernization of facilities. To this disaster, another has been added more recently: world prices for coal and steel are spiraled downwards, causing already-struggling firms to go into virtual collapse.
Both mining and metallurgy are undergoing serious financial troubles in both Ukraine and Russia, but the impoverished unrecognized territories have few options for shipping and selling any products they make. Mines have been closing down and are only draining water, while workers have been put on indefinite unpaid leave. For instance, as of December 6, the mines of the Torezantratsyt Union are in downtime mode. The decree to this effect issued by DNR’s “minister for the coal industry” Ruslan Dubovskiy said that this was necessary “in connection with the lack of organizational and technical conditions necessary to carry on operations in the core activities, as a result of the sharply worse financial situation at the company.”
As a result, wage arrears have grown. Today, ORDiLO miners still don’t even have all their wages for October. Nor are they in a position to organize a strike and demand their back pay: any calls for demonstrations are strictly punished those who dare to voice such calls are immediately called “agents of the SBU,” Ukraine’s security bureau.
Dubovskiy’s letter to Denis Pushilin in summer 2019 reporting on the situation offers a good glimpse into the real state of affairs in the occupied territories. Although it was written half a year ago, the situation has not likely improved since than: “A state coal enterprises that are under the administration of the DNR ministry of coal and power, the situation is critical due to delayed payments for coal delivered to OAO Vneshtorgservis and its subsidiary Ugol Donbassa,” Dubovskiy reported to his boss. “As of June 3, 2019, RUB 1,586.6 million was outstanding, of which RUB 962.1mn was overdue.”
Such enormous debts have not disappeared. Moreover, it’s obvious that they have accumulated with the approval of Kurchenko’s Moscow handlers. Nor is there any power in ORDiLO that might force Kurchenko to settle these debts. In effect, the occupied territory has turned into a colony in the service of the one-time Ukrainian oligarch, something that a number of Russian sources that are supposedly sympathetic to the militants write about without any embarrassment whatsoever.
At this point, there are no statistics that might illustrate the real economic state of ORDiLO. That is, there are numbers, but they are not being published in open sources. And so the only way to understand what is going on is through indirect indicators, such as the numbers in Dubovskiy’s letter or decrees shutting down operations or closing businesses altogether. Just recently it became known that the Donetsk High Voltage Insulator Plant was permanently closed, and Horlivka’s Stirol, one of the oldest makers of nitrogen fertilizers in Ukraine, owned most recently by oligarch Dmytro Firtash, was put on hold. All this testifies to the fact that the decline of the areas of Donetsk and Luhansk Oblasts that were taken over by Russia’s proxies continues.
Under the circumstances, the militants have been trying to find other sources of revenue for their pathetic budgets and keep finding new ways to get money out of the wretched local population, which has effectively become their hostage. In the very first days of the new year, DNR decided to ago after owners of cars with Ukrainian license plates. Drivers whose plates weren’t “republican” were stopped and their cars impounded.
Given all these economic woes, the only good news for residents of ORDiLO, or rather those who favor the Russian Federation, was the issuing of Russian passports, which began in 2019. After five years of armed conflict, Russian President Vladimir Putin finally decided to simplify the process of getting citizenship for residents of the Donbas territory under his control. Except that this process has been deliberately organized in a way that it will drag on for years.
In fact, it turned out that there were few applicants. For the hundreds of thousands of those who are negative about Ukraine, it might offer an opportunity to move away from the thoroughly robbed pseudo-republics, with their lawlessness and poverty, to a country with a relatively normal living standard, to avoid bureaucratic hassles in looking for employment and to settle into a new place relatively easily. For those who have no plans to leave ORDiLO, however, a Russian passport is a triviality that will do nothing to make their lives easier.
According to the Russian foreign ministry, as of April 2019, some 125,000 Ukrainians living in ORDiLO had taken out a Russian passport. The number seems impressive, but at this pace, it would take a good 15 year to issue such passports to the entire population of DNR and LNR.
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Whatever happens, the issuing of Russian passports will simply lead to a faster shift of ORDiLO residents to Russia. It seems that Russia is determined not only to take all the region’s natural, industrial and financial resources, but also its human ones. Of course, this can only make the situation that much worse in Donbas. The region is undergoing an accelerated pace of depopulation, which can only lead to a worse human resource crisis.
And so occupied Donbas is entering the new year with the same set of problems it started 2019. At this point, they look fairly insurmountable. The only thing that might break the situation would be for ORDiLO to return under Ukrainian law and for comprehensive restoration to begin. But right now it’s not yet time to talk about this.
Translated by Lidia Wolanskyj
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