
On July 22nd, the Ukrainian government undermined anti-corruption institutions. What can be done?
An open letter
On July 22nd, 2025, the Ukrainian government undertook a blitzkrieg against Ukrainian anti-corruption infrastructure established during the reforms of 2014-2015. A new law deprives these institutions of their independence and makes them subordinate to the Prosecutor General, who is a political appointee. The bill was first submitted to the parliament in January 2025 as a law on procedures for locating missing persons. After its adoption in the first reading, the draft law flew under the radar until July 22nd, when it was suddenly amended for the second reading, adopted, and signed by President Zelensky within a few hours.
The law not only severely damages Ukraine’s anti-corruption infrastructure but also was adopted without following the correct parliamentary procedures. It was signed by the speaker without due consideration of existing decrees blocking the law, which must be upheld or overriden by the parliament before the speaker can sign. Moreover, amendments to the second drafts of laws cannot completely overhaul them (as was the case with this law, which originally concerned missing persons). No wonder Ukrainians immediately took to the streets to protest the law and protect anti-corruption institutions.
This is not the first time that Ukrainian institutions have come under attack. The government tried to sabotage the creation of the High Anti-Corruption Court (HACC) in 2018, while the Constitutional Court canceled the electronic asset declaration (e-declaration) system in 2020. It also forced the resignation of the governor of the National Bank of Ukraine in 2020, and tried to block the appointment of the head of the Special Anti-Corruption Prosecution Office (SAPO) in 2021-2022. More recently, it didn’t appoint the properly selected head of the Economic Security Bureau of Ukraine (ESBU).
We know how most of these cases eventually ended: the HACC was launched, e-declarations were restored, the National Bank of Ukraine now operates quite successfully, and the SAPO head was appointed (this was one of the conditions for starting Ukraine-EU accession negotiations in 2022). We don’t know how the situation with the July 22nd law or the ESBU head will end. However, we can be sure that this blitzkrieg will fail in the same way as Putin’s attempt to “take Kyiv in three days.” Ukrainians repelled former President Yanukovych’s attempt to thwart its European future in 2013, and they will not allow anyone to undermine the country’s most successful institutions, expand the powers of the state, or make Ukraine more akin to Russia. The international community can help them in the following ways:
- First, remember that the existential threat is Russia. Therefore, the supply of weapons for the Ukrainian army should be increased. Weapons can be supplied either directly from EU or US producers to military units, or they can be procured from Ukrainian manufacturers via the “Danish model.” In fact, Ukraine’s donors would gain more leverage to negotiate “money in exchange for reforms” if they gave less to finance humanitarian causes and more to support the military, while allowing the Ukrainian government to provide pensions and other social benefits from the taxes it collects (this would not change the total amount of international support, but could incentivise Ukraine’s government to seek more efficient solutions).
- Second, refrain from perpetuating an oversimplified stereotype of Ukraine as “a very corrupt country.” While corruption cannot be justified, especially during the war, it is not what characterizes Ukraine. Ukraine has a very rich culture, developed horizontal networks and civil society, and a strong capacity to self-organize. Many Ukrainians not only live according to European values but actually die for them. As we noted above, Ukraine’s recent political history proves that any attempt to circumvent the people’s will or hinder democratic and anti-corruption institutions will fail time and again. If anything, Ukrainians mobilize faster and more aggressively against any perceived threat to democratic institutions than their peers in many Western democracies.
- Third, take action against the “endpoints” of corruption. Very often, dubious transactions are enabled by banks that are lax on Know Your Customer or Anti-Money Laundering regulations. People who know for certain that their unlawfully acquired money cannot be stored in a safe haven will be less likely to try to acquire money unlawfully in the first place.
- Fourth, insist on reforms. At the recent Ukraine Recovery Conference in Rome, EU officials tried to avoid these “sensitive” topics. However, reforms are needed first and foremost for the benefit of Ukraine: more efficient government and regulations combined with less pressure on businesses are prerequisites for a strong economy, which is necessary to win the war.
The Ukrainian government made a mistake yesterday, as it has many times in the past. However, the Ukrainian people, together with Ukraine’s international partners, can convince the government to correct it (specifically, to cancel the law in question). The events of July 22nd have shown us that the parliament and the president can adopt laws very quickly. Now it’s time to create incentives for them to use this skill to adopt reforms that are actually needed.
If you would like to add your signature to the letter, please fill out this form.
Signatures
Yuriy Gorodnichenko, Quantedge Presidential Professor of Economics, University of California – Berkeley; Co-Founder, Economists for Ukraine
Tatyana Deryugina, Associate Professor of Finance, University of Illinois, Urbana-Champaign; Co-Founder, Economists for Ukraine
Anastassia Fedyk, Assistant Professor of Finance, Haas School of Business, University of California, Berkeley; Co-Founder, Economists for Ukraine
Ilona Sologoub, VoxUkraine editor; Co-Founder, Economists for Ukraine
James Hodson, CEO of the AI for Good Foundation; Co-Founder, Economists for Ukraine
Torbjörn Becker, Director of the Stockholm Institute of Transition Economics
Andriy Boytsun, PhD, Founder and Editor of the Ukrainian SOE Weekly; Independent Corporate Governance Professional; Former Member of the Strategic Advisory Group for Supporting Ukrainian Reforms.
Joerg Breitung, Institute of Econometrics and Statistics, University of Cologne
Dora Costa, Department of Economics, University of California, Los Angeles
Larry Diamond, William L. Clayton Senior Fellow, Hoover Institution, Mosbacher Senior Fellow in Global Democracy, Freeman Spogli Institute for International Studies, Bass University Fellow in Undergraduate Education
Scott Gehlbach, Elise and Jack Lipsey Professor, Department of Political Science and Harris School of Public Policy, University of Chicago
Kai Gehring, Department of Economics, University of Bern
Danilo Guaitoli, Department of Economics, New York University
Denis Gutenko, Head of the State Fiscal Service (SFS) of Ukraine from 2019 to 2020
Jerg Gutmann, Institute of Law and Economics, University of Hamburg
Kristofer Harrison, President and founder — The Dekleptocracy Project and anti-corruption scholar
Olena Havrylchyk, Professor of Economics, University Paris 1 Pantheon -Sorbonne
Matt Holian, Department of Economics, San Jose State University
Tetiana Ilchuk, Co-Founder, Ukrainian Media League
d’Artis Kancs, Senior Economist, European Commission
Aishe Khalilova, International Commission on Missing Persons (ICMP)
Jerzy Konieczny, Wilfrid Laurier University, International Centre for Economic Analysis and Review of Economic Analysis
Natalia Kononenko, PhD, Leading Research Fellow at the Kuras Institute of Political and Ethnic Studies of the National Academy of Sciences of Ukraine
Andrew Kosenko, Associate Professor of Economics, School of Management, Marist University
Debra LaPrevotte, International Corruption Investigator
George Loginov, Department of Economics, Augustana University
Oleksandr Lysenko, Board member of the Corporate Governance Professional Association
Mats Marcusson, retired economist
Benjamin Moll, Sir John Hicks Professor of Economics, London School of Economics
Oleksandra Moskalenko, Visiting Professor at the London School of Economics and Political Science, Professor at Kyiv National Economic University named after Vadym Hetman
Roger Myerson, David L. Pearson Distinguished Service Professor of Global Conflict Studies at The Pearson Institute for the Study and Resolution of Global Conflicts in the Harris School of Public Policy, the Griffin Department of Economics, and the College of the University of Chicago
Tymofiy Mylovanov, President of the Kyiv School of Economics
Marco Pagano, Professor of Finance, Università di Napoli Federico II
Olga Pindyuk, Economist, Vienna Institute for International Economic Studies, Austria
Maksym Polyakov, Senior Economist, Manaaki Whenua-Landscare Research, New Zealand
Nataliia Popovych, Co-Founder, Resilient Ukraine Civil Society Organization
Alberto Rizzi, Policy Fellow, European Council on Foreign Relations
Mykola Ryzhenkov, Chair of International Economic Policy, Osnabrück University
Daniel Schaefer, Department of Economics, Johannes Kepler University Linz
Dr. Benjamin L. Schmitt, Senior Fellow, University of Pennsylvania; Affiliate, Harvard-Ukrainian Research Institute
Moritz Schularick, President of the Kiel Institute for the World Economy
Dmitriy Sergeyev, Department of Economics, Bocconi University
Natalia Shapoval, President of the KSE Institute
Oleksandr Shepotylo, Aston Centre for Business Prosperity, Aston University, UK
Olivier Simard-Casanova, Faculty of Law, Economic Sciences and Management, Université de Lorraine
Daniel Spiro, Department of Economics, Uppsala University
Austin Starkweather, Haslam College of Business, University of Tennessee
Jodi Vittori, Professor of Practice, Global Politics and Security Concentration Co-Chair, Master of Science in Foreign Service, Georgetown University
Vitaliia Yaremko, Assistant Professor in Economics, Trinity College Dublin