Before Moscow’s full-scale invasion of 2022, a small circle of ultra-wealthy businessmen controlled strategic industries, owned national television networks, and financed political parties. Figures such as Rinat Akhmetov, Igor Kolomoisky, and Viktor Pinchuk enjoyed influence that often extended far beyond the boardroom.
Every Ukrainian president promised to dismantle this system. None delivered.
Russia’s war of aggression may have done more to weaken Ukraine’s oligarchs than any anti-corruption reforms. The war has destroyed industrial assets, disrupted exports, centralized political authority, and dramatically reduced their influence over the media.
Yet at the same time, wartime governance, defense procurement, reconstruction, and the growing concentration of resources around the state have laid the foundations for a new generation of politically connected business people. Will Kyiv be able to contain its power?
The roots of Ukraine’s oligarchy lie in the privatizations of the 1990s. Following the collapse of the Soviet Union, the country inherited vast industrial assets, from the steel mills of Kryvyi Rih to the coal mines of Donbas and the gas transit infrastructure linking Russia to European markets.
The transition to a market economy was overseen by weak institutions and an underdeveloped legal system, which were unable to rein in the fierce competition between emerging groups of rapacious and ambitious businesspeople.
Rather than creating a broad class of owners, privatization concentrated strategic assets in the hands of a small number of individuals with access to political decision-makers, regional administrative networks, and financial resources.
Control was frequently secured through non-transparent privatizations and preferential access to state resources. The most famous example was the 2004 sale of the Kryvorizhstal steel plant to a consortium linked to oligarchs Rinat Akhmetov and Viktor Pinchuk at a price widely criticized as far below market value. Following the Orange Revolution, the sale was overturned, and the plant was re-auctioned in 2005 for more than six times the original price, becoming a symbol of how strategic assets had been concentrated in the hands of politically connected elites. During the 1990s and early 2000s, these figures also acquired banks, media outlets, and political influence.
Political philosopher Mikhail Minakov describes the resulting order as a “Republic of Clans,” with powerful regional financial-industrial groups deeply embedded in state institutions. Donetsk produced the network around Akhmetov and the Party of Regions, while Dnipropetrovsk became associated with influential figures such as Kolomoisky and Pinchuk.
This distinguished Ukraine from Russia, where oligarchs emerged through privatization but evolved differently. In Russia, major business groups were subordinated to a centralized presidential system, and while oligarchs retained enormous wealth, it was dependent on their remaining loyal to the Kremlin.
In Ukraine, no president succeeded in establishing a comparable “power vertical” and instead competing oligarchs financed rival political parties, controlled television networks, supported competing presidential candidates, and used state institutions to advance their interests.
While this competition helped preserve political pluralism and prevented the emergence of a fully authoritarian system, it also delayed the development of rules-based governance.
Political parties often depended on oligarchs for funding, and powerful people, including lawmakers and judges, were routinely tied to competing business groups. The state frequently operated as a battleground for rival clans.
This damaged Ukraine’s democratic development and international reputation while undermining public trust in its institutions and complicating Kyiv’s long-term European ambitions. Anti-corruption reforms launched after the 2014 Revolution of Dignity constrained some oligarchic influence but didn’t dismantle the underlying model.
The full-scale invasion fundamentally altered this balance.
Russia’s occupation and destruction of eastern industrial regions devastated the foundations of several oligarch empires. Rinat Akhmetov, previously Ukraine’s richest man, lost major industrial assets in Mariupol and the occupied Donbas territories, for example.
The war also weakened the oligarchs’ media power. Kyiv introduced a unified national TV news operation, which consolidated many of the country’s broadcasters, and limited the ability of competing oligarch-owned channels to shape political narratives.
Several prominent oligarchs were exiled or marginalized. Viktor Medvedchuk, long viewed as the Kremlin’s primary political ally in Ukraine, was arrested and later exchanged with Russia in a prisoner swap.
Igor Kolomoisky, once considered politically untouchable, was arrested in 2023 on fraud and money laundering charges. Other figures associated with pro-Russian networks fled the country.
The war also accelerated the collapse of business-political networks that benefited from close economic integration with Russia. Several influential business groups depended on commercial ties with Russia. Medvedchuk’s political network, for example, was closely tied to energy trading and pro-Kremlin influence operations that became politically toxic after 2022.
Their assets were sanctioned, media platforms shut down, and political allies marginalized, as public tolerance for Russian influence evaporated.
At the same time as the “traditional” oligarchs were losing money and influence, others were rapidly making fortunes in new areas.
Declaring the end of oligarchy in Ukraine would be premature, not least because the core logic that produced oligarchic behavior remains deeply embedded.
Wealthy people sought political influence not simply out of greed, but because property rights and legal protections were weak, inconsistent, and dependent on political access. Under such conditions, proximity to the state was the most reliable form of business insurance.
The government in Kyiv now controls enormous flows of resources. Defense procurement alone has expanded dramatically since 2022, while reconstruction programs and donor-funded infrastructure projects are creating new opportunities for politically connected actors.
And as Western governments and institutions stand ready to channel hundreds of billions of dollars into Ukraine’s long-term reconstruction, the risks associated with political favoritism and opaque wartime networks are growing.
Ukraine has continued to face major corruption risks connected to state-controlled financial flows. The 2023 scandal involving inflated food procurement prices for the military highlighted the vulnerabilities created by rapid wartime spending and limited oversight.
To Kyiv’s credit, civil society, investigative journalists, and anti-corruption institutions are more active and resilient than in many other post-Soviet states, and the exposure of corruption has forced high-profile resignations, investigations, and policy responses.
But the structural risks remain serious.
Postwar Ukraine will see a growth in the influence of people connected to the security apparatus. Wartime conditions have significantly expanded the authority of institutions such as the Security Service of Ukraine (SBU). The agency has become one of the country’s most visible state institutions, conducting high-profile investigations, counterintelligence operations, and sanctions-related actions.
A new generation of oligarchic actors may emerge from wartime state capitalism, producing elites that are likely to be different from the industrial magnates who have dominated Ukraine for decades.
Some may emerge from the rapidly expanding defense-industrial sector, while others could build influence through reconstruction projects financed by international donors. Ukraine’s technology sector, which has remained remarkably resilient during the war, may also produce a new class of politically influential entrepreneurs.
Unless Kyiv succeeds in strengthening the rule of law, judicial independence, transparent competition, and accountability, new business elites are likely to reproduce many of the patterns that characterized the old oligarchs.
Recent polling suggests Ukrainians continue to support anti-corruption reforms and view excessive concentration of political and economic power as a threat to the country’s future.
These attitudes reflect a public demand for rules-based governance. If reconstruction produces transparency, Ukraine could finally break with the post-Soviet model that has constrained its development for decades.
But if wartime centralization and politically connected business groups become permanent features of the postwar economy, Ukraine may simply exchange one form of oligarchy for another.
Kateryna Odarchenko is a political consultant, a partner of the SIC Group Ukraine, and president of the PolitA Institute for Democracy and Development. A specialist practicing in the field of political communication and projects, she has practical experience in the implementation of all-Ukrainian political campaigns and party-building projects.
Europe’s Edge is CEPA’s online journal covering critical topics on the foreign policy docket across Europe and North America. All opinions expressed on Europe’s Edge are those of the author alone and may not represent those of the institutions they represent or the Center for European Policy Analysis. CEPA maintains a strict intellectual independence policy across all its projects and publications.
