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In Eastern Ukraine, No Good Options Remain

Rebel-held Luhansk now stands on the frontline of the conflict between East and West.

  • Last updated: March 1
  • Total word count: 2539 words

Summary

In November 2013, protests erupted in Kiev over the pro-Russian government’s refusal to sign a trade deal with the European Union. The protests led to the ouster of President Viktor Yanukovych and the establishment of a new, pro-Western government, which promptly announced that the country would continue its move toward integration into the European Union. And so it became evident that there was a deep divide in Ukraine between two camps: one that wanted to increase integration with Europe and another that preferred to maintain strong ties with Russia.

The second camp is represented strongest in eastern Ukraine, which has been simmering in conflict since 2014, when the Russian-backed Luhansk People’s Republic and Donetsk People’s Republic declared independence. Both republics are just part of the Luhansk and Donetsk regions, which are part of the wider region of Donbass. Separatism is ubiquitous here because of the region’s cultural and economic ties to Russia and its industrial roots.  

Of the two republics, the LPR is less stable and weaker economically. It has been plagued by infighting, occasional violence and even allegations of an attempted coup in November, when armed men appeared on the streets of the city of Luhansk, the self-proclaimed republic’s capital. The incident was apparently the result of a power struggle between the leader of the LPR, Igor Plotnitsky, and the ousted interior minister. Days later, security minister Leonid Pasechnik announced that Plotnitsky had resigned for health reasons and that he would be taking over as interim leader. This Deep Dive will focus on Luhansk, a region that stands on the frontline of the conflict between East and West. It will look at how this conflict spread to the self-proclaimed republic, why the LPR has remained unstable and what its future might look like.

Origins of the Conflict

Luhansk is a highly urbanized region on the eastern edge of Ukraine that spans roughly 10,000 square miles (26,000 square kilometers). It borders two other Ukrainian regions, Kharkov and Donetsk, but the border it shares with Russia is longer than the one it shares with the rest of Ukraine. It once had a population of more than 2 million, but this number has been declining for years as people fled the fighting for cities like Kiev or Moscow. As of December 2017, the population of the LPR was 1.4 million, with 435,000 of those living in the city of Luhansk.


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The population of the LPR can be divided into four categories: Russian speakers (the largest category), Ukrainian speakers, speakers of both languages, and Russian speakers who call themselves ethnic Russians. According to the 2001 census – the most recent census in Ukraine – 52 percent of the population in the LPR is Ukrainian and 44 percent is ethnic Russian. But 77 percent of people said their native language was Russian, and there are areas within the LPR – including the Krasnodonsky district and the Stanichno-Luhansky district – where the Russian population is dominant.


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When the new, pro-Western government in Kiev took office in February 2014, it had the support of the population in the capital and in the northern and western parts of the country, but it failed to sway people in the southern and eastern parts, where Yanukovych and his political party, the Party of Regions, enjoyed greater support. By late April 2014, a confrontation was brewing between Russian-backed separatist rebels and Ukrainian security forces. Occasional clashes soon turned into a full-fledged armed conflict. Kiev’s drift into the Western sphere of influence concerned Moscow, which sees Ukraine as a critical buffer between itself and Europe. But Russia also viewed the unrest in eastern Ukraine as an opportunity to increase its influence over the region by supporting the separatists and even annexing Crimea.


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Today, there is a divide not just between Ukraine and the separatist parts of Luhansk but also within Luhansk itself. The government in the LPR is a hybrid between the prewar civilian-controlled structures and the structures that emerged after the war broke out – a somewhat chaotic arrangement. When the LPR declared independence, its leaders were little known, and many believe that the Kremlin chooses its government officials. During his time as head of the republic, Igor Plotnitsky attempted to subdue all areas of the republic but ultimately failed. Plotnitsky fled to Russia and left behind a population that has yet to decide how to define its relationship with its eastern neighbor or to what degree it wants to be administered by Moscow.

Economic Development

The part of the Luhansk region where the LPR is located is known for its vast deposits of high-quality coal. Sitting in the Seversky Donets River basin, the area accounts for roughly a third of Ukraine’s total coal reserves and two-thirds of its reserves of anthracite, a type of coal with a high carbon content that produces more energy than other types of coal. These resources, as well as the area’s natural gas deposits, offered Ukraine domestic sources of energy and commodities for export. The driver of the LPR’s economy, therefore, has been industry, coal and metal production, and engineering.

Significant coal extraction in eastern Ukraine began in the late 18th century. The minerals concentrated there transformed the area into an industrial hub, and during the rule of Catherine II (1762-96), its first factory was built. Coal from the east not only fueled local industrial activity but also served as a cornerstone of Russia’s industrialization.

At the beginning of the 20th century, the first attempt was made to separate this region from other industrial regions. In 1918, the Donetsk-Krivoy Rog Soviet Republic – which included present-day Kharkov, Donetsk and Luhansk – was established as an autonomous republic, uniting the coal-producing regions. Despite the territory’s autonomous status, however, the Soviet Union maintained control over it, since the Soviets wanted to create an industrial zone that would service and depend on Moscow. The importance of this history is that this region, unlike other autonomous regions in the Soviet Union, was united not by a common sense of identity or nationality but by its economic utility.

The Donetsk region had two advantages that enabled it to outperform Luhansk economically: a higher population, and direct sea access through the Mariupol port. But in the 1960s and early 1970s, Luhansk prospered. Its economy began to grow, coal and pig iron production increased, and electricity supplies expanded. Progress diminished over time, however. The industrial facilities built in Luhansk could not sustain long-term growth, and the region’s development was placed on the back burner as oil began to play a larger role in the energy market. Moscow dedicated less time and fewer resources to the upkeep of infrastructure and industry unrelated to the oil sector, and the Luhansk region suffered.

The poor economic conditions of the 1980s were the springboard for separatism, which really took off in the 1990s. Before the 1991 referendum that gave Ukraine its independence from the Soviet Union, representatives of the Soviet Union’s Constitutional Democratic Party proposed separating the southern and eastern portions of Ukraine to form a new state called Novorossiya. In 1993, local miners went on strike over their belief that Donbass was subsidizing the poorer regions of Ukraine while receiving little investment in return. Miners demanded autonomy for Donbass over its economic affairs. In addition, a 1994 survey showed that 90 percent of the residents of Donbass supported implementing a federal system and imposing Russian as the second official language in Ukraine.

The region saw its second growth spurt in the 1990s, but it too would prove unsustainable. During this time, two activities became important contributors to the economy – and both were illegal. The first was surface mining for coal. The Soviet Union had prohibited the practice, but it was a cheap and quick way to extract coal. When Ukraine became independent, surface mining remained illegal, but those who participated in it weren’t punished and it therefore became widespread. The second profitable business was smuggling goods, especially fuel. The drawback of both these activities, however, is that they never created the conditions for further growth in Luhansk.

At the same time, legal coal production enterprises were going bankrupt. Their employees weren’t paid for years, and the riots that resulted were often suppressed by militias throughout the 1990s. As a result, in the 2000s, legal coal production declined. The post-industrialization era had taken root, and the service sector was becoming a critical part of the global economy. Luhansk, however, was left behind.


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Moreover, industry and coal mining proved to be a double-edged sword for Luhansk. For a long time, they served as the source of the region’s economic development; but they also strengthened its dependence on Russia. Russia was the main buyer of the region’s industrial products, and illegal supplies coming in from Russia only increased this dependency. The economy of the region was built to be a component of the Soviet economy, so after the collapse of the Soviet Union, factories in Luhansk had no choice but to continue to work closely with Russian businesses.

This explains, at least in part, why Luhansk and its neighbors were reluctant to support a pro-Western government that could put their relationship with Russia at risk. The coal, metals and machine-building industries that had survived were less competitive than those in the rest of Europe. Given that Russia is Luhansk’s biggest market, there is concern in the manufacturing sector that if this territory does not maintain a pro-Russian outlook, thousands of jobs could be lost.

The Rise of Separatism

There were three sources for the discontent in Luhansk that explain its embrace of separatism. First, people were dissatisfied with the government in Kiev, particularly the way it distributed the country’s resources. As in previous decades, many believed that the region’s wealth and resources were being unfairly redistributed to the impoverished and less productive parts of the country, which contributed to a growing sense of alienation from the rest of Ukraine. But this was a misconception. Luhansk region accounted for 4 percent of Ukraine’s gross domestic product in 2013, 13 percent of its imports and 5 percent of its exports. It also accounted for 8 percent of state subsidies in 2010 and 11 percent in 2011 – more than double its GDP contribution. Nevertheless, the perception of economic inequality and unfair conditions was still there, and it was a major driver of the separatist movement.

Second, the Euromaidan revolution bolstered right-wing Ukrainian nationalists who, among other things, tried to repeal the law that allowed regions to give special status to minority languages. The separatists argued that Kiev was trying to diminish the importance of the Russian language in Russian-speaking regions, although ordinary people in these regions were less concerned about the language law than they were about potentially declining economic opportunities.

Last, these regions believed there were negative consequences to joining the European Union – specifically reduced trade with Russia and the Eurasian Economic Union and the possibility that Ukraine could be forced to adopt austerity measures similar to those imposed on countries like Greece that have struggled with high debt and other economic problems.

But despite the rising desire to form an entity that was free from Kiev’s oversight, there was a lack of national identity that could draw the regions of eastern Ukraine together. Here, separatism was not motivated by nationalism, since no single nation has ever formed in Luhansk. Rather, Luhansk’s industrial surge attracted migrants from a wide variety of places, such as Siberia, the Volga region and western Ukraine. What emerged in Luhansk during its age of industrialization was what the Soviet Union dreamed of: a proletariat. The population of Donbass was therefore mainly composed of the working class, which served the interests of the state and large industries.

The population has always been fragmented. It is essentially dominated by the workers, who desire stability – as an autonomous republic. Whether this autonomous republic was part of Ukraine or Russia was not nearly as important for the population as autonomy itself was.

The Future

For the LPR, there are few options remaining. It can be absorbed into the Russian Federation, become an autonomous region within Ukraine, unite with Donetsk or continue the frozen conflict as it stands today. None of these are good options.

It is unlikely that the territory will become part of Russia because Moscow, by agreeing to the Minsk agreement, has indicated it doesn’t want to absorb the LPR. Taking over the LPR would require dedicating more funds – already in short supply – to the region. Russia is more interested in having the LPR as a loyal buffer zone and strengthening its dependence on Moscow by providing it more supplies and military assistance. The LPR’s reliance on Russia is already growing as it is, with Moscow delivering much-needed aid, food and energy supplies.

In 2017, Ukraine imposed a cargo blockade on the LPR, following unofficial blockades imposed by Ukrainian activists – although deliveries of some humanitarian aid are still allowed. This only deepened the area’s dependence on Russian supplies. Before the war, 70 percent of the products available in stores were from Ukraine; this number has fallen to 20-30 percent. Many products sold in the region now are made in Russia or in other countries such as Finland, Germany, Turkey and Greece and imported through Russia. Luhansk’s main factories supply a narrow market, without the possibility of export outside Russia due to the lack of recognized quality. In addition, Russia – through the energy giant Gazprom – is the main supplier of electricity to the LPR.

It is also unlikely that the LPR would rejoin Ukraine as an autonomous region – the solution offered by the Minsk agreement. Ukraine has been unwilling to accept this arrangement. It believes the country should be unified and won’t accept autonomous status for the breakaway republics.

The third option – forming one state with the Donetsk People’s Republic – is also probably a nonstarter. The DPR – the economically stronger and politically more stable region – would be interested in uniting with the LPR, since it could then take control over the LPR’s coal and metal production and other industrial activities. But the LPR wouldn’t accept this option because the two regions have been engaged in an unofficial struggle for leadership over Donbass for years, and joining the DPR would mean ceding control. Both sides claim that they support the idea of integration – the heads of both republics agreed in 2016 to create a single economic zone, though it has been fraught with problems, and they recently signed an agreement to form a customs union – but the reality is much different. For its part, Russia opposes unification of the republics because it could diminish Moscow’s influence over the region and increase Donetsk’s. Russia prefers to have Luhansk and Donetsk as two separate buffers rather than one large territory with its center in the city of Donetsk, which is far from the Russian border.

For now – and as long as the parties involved are unwilling to make the concessions necessary to find a solution – the LPR seems destined to remain in this frozen conflict. Moscow, meanwhile, will continue to strive to expand westward and claim lands historically connected to Russia, and Ukraine will seek to limit the spread of Russian influence.