Ukraine city near conflict zone engulfed by cloud of suspicion about oligarchs

On the approach to Dnipropetrovsk airport, plane passengers see thick pillars of grey, white and even grimy orange smoke rising towards them.

It’s not typical postcard material, but residents of this industrial Ukrainian city have a certain pride in their belching factories.

“It shows we’re not like Donetsk or Luhansk,” says Ihor, a taxi driver at the terminal, nodding towards regions to the east where Ukrainian troops are fighting Russian-backed separatists.

“Over there, the industry and coalmines are smashed to bits, or at least not working. And the only smoke you’ll see is from bombs and grenades.”

Many of Dnipropetrovsk's one million people see their city as an example for Ukraine, as it prepares for a general election tomorrow.

This election will be dominated by parties which support its dramatic swing away from Russia and towards the West.

It is the closest major government-controlled city to the separatist stronghold.

It serves as a base for soldiers and volunteers fighting the rebels, as a key supply hub, and as a centre for treating the war wounded and identifying the fallen.

War footprint

Reminders of the war are everywhere: passenger planes taxi past fighter jets and camouflaged military radar on their way to the terminal.

Injured soldiers fill the hospitals and the dead cram the morgues; local officials help organise prisoner-swaps with the separatists; trenches, tank traps and checkpoints ring the city; and rumours of rebel cells and spies are rife.

"If you do something well, you are given more to do . . . Officials in Kiev have moved certain operations here, and sometimes we struggle to manage," deputy governor Borys Filatov said in a recent interview.

“This is a very strange war. It really is a war – a Russian invasion – but officially it’s still an ‘anti-terrorist operation’.

“And a lot of people are totally removed from it. Lots of people in warm offices in Kiev don’t feel it, but here you can go mad from the siren wail of ambulances bringing back wounded men.”

No one doubts Dnipropetrovsk’s contribution to the war effort.

But, behind the city’s forest of Ukrainian flags, some still see the ills that have dogged the country for decades: the corruption and cronyism of a kleptocracy that has no interest in the drive for democracy and transparency that inspired last winter’s revolution.

“Politics is still a fight between oligarchs,” said Tamara, a housewife shopping in central Dnipropetrovsk.

“Some are better for the country than others. But their main interest is themselves, and their money. Not how ordinary people live.”

Such matters are particularly sensitive in a city and region that are now run by one of Ukraine's most controversial tycoons – billionaire Ihor Kolomoisky.

Ruler of a business empire that spans banking, airlines, metals and media, Kolomoisky was appointed governor of his home province in March, with a clear but daunting remit to stop the spread of the insurgency from Donetsk and Luhansk.

Kolomoisky succeeded, by using all the techniques that helped him amass his fortune, and by using some of that money to fund the war effort.

While once best-known as an alleged corporate “raider” – an ex-Soviet-bloc term for those who use dirty tricks and intimidation to steal companies – now Kolomoisky is most famous for financing volunteer battalions that fight in the east.

Accusations denied

He denies accusations that he bent and broke the law in business.

However, he now faces claims that could be even more damaging for him, the pro-western politicians he supports and for Ukraine’s efforts to break with the past and cleanse public life.

This week, a recording was released on which he allegedly discusses rigging the elections in certain districts of eastern Ukraine, in favour of candidates loyal to him and his allies, with a politician linked to President Petro Poroshenko.

The authenticity of the recording has not been established, but the Opposition Bloc party swiftly urged election officials to ask Poroshenko to consider sacking Kolomoisky for his alleged interference in the ballot.

Opposition Bloc – which has provided a political refuge for many former allies of ousted president Viktor Yanukovich – also warned that fighters partly funded by businessmen like Kolomoisky could intimidate voters.

“We ask members of the central election commission to pay particular attention to the unjustified presence in and close to polling stations of armed representatives of units from Ukraine’s armed forces, interior ministry and volunteer battalions, which are not controlled by the Ukrainian authorities,” the group said.

Populist leader Oleh Lyashko, whose Radical Party is forecast to come second to Poroshenko’s group tomorrow, also urged the president to sack Kolomoisky.

‘Good oligarchs’

He said he never wanted to hear about “good oligarchs” again.

“Oligarchs are just as bad for Ukraine as [Russian president Vladimir] Putin’s aggression,” he said, comparing the shadowy billionaires to Russia’s leader.

Kolomoisky’s supporters dismiss claims that he would use the battalions or other levers to influence the vote.

They said far greater danger came from Opposition Bloc and other oligarchs whose loyalty to Ukraine is under question.

“The governor has shown that he is a patriot.

“And a rich patriot is more use than a poor one in times like these,” says Nikolai, a Dnipropetrovsk pensioner who was reading election news in a local paper.

Yanukovich’s era

“These old faces from Yanukovich’s time are the ones to watch out for.

“And oligarchs that support them from the shadows – at least we know whose side Kolomoisky is on.”

Dnipropetrovsk’s governor is seen as a Poroshenko supporter, while the country’s two other richest tycoons – Rinat Akhmetov and Dmytro Firtash, who both have huge investments in eastern Ukraine – are believed to back candidates running for, or linked with, Opposition Bloc.

While Opposition Bloc is expected to perform poorly in the race for parliamentary seats allotted proportionally according to party lists, figures allied to it are expected to use their local influence to win single mandate constituencies.

Some could even come from Dnipropetrovsk, which was dominated by Yanukovich’s allies before the revolution and the rise of Kolomoisky.

“They laid low for a bit,” grumbled Nikolai, “but now they’re popping back up, in a different party, or different place.”