Monthly Context Report - June 2023

Cover photo: June 2023, Kherson Oblast, Ukraine. Flooding in the Kherson Oblast region has driven many residents from their homes. © Robert Dolan

Summary

Destruction of the Kakhovka dam on June 6 resulted in the death of dozens of civilians, displaced thousands, tens of thousands lost their livelihoods, and millions experienced disrupted access to clean water. Economic and environmental effects go far beyond Ukrainian borders and are still to be fully assessed. The National Bank of Ukraine) calculated that the Kakhovka dam destruction would decrease annual GDP by 0.2% and increase inflation by 0.3%, which was slowing down before. The agricultural sector will lose up to $10 billion over the next five years. 

In early June, Ukrainian forces reportedly initiated counteroffensive operations in the southern direction of Zaporizhzhia and Donetsk oblasts. In the first weeks, Ukrainian advances remained limited and localized. Control has been re-established over at least nine small settlements in the area. Russian air attacks, likely to hamper the Ukrainian counteroffensive, resulted in numerous civilian victims. A recent Kyiv International Institute of Sociology study shows that 78% of Ukrainians have had relatives or friends killed or injured since February 24, 2022.

The June 21–22 Ukraine Recovery Conference in London gathered representatives of 60 countries and resulted in donors’ pledges of $66 billion, including the European Union committing $55 billion. International donors pledged support covering 70% of Ukraine’s spending for 2023.

Leaders of six African countries visited Kyiv and Moscow to “restore a peace dialogue,” including grain and fertilizers agreements. The envoy of Pope Francis tried to explore possible ways to achieve “just peace.” Both initiatives were met with skepticism in Ukraine.

Starting in June, electricity for households increased by 80%, and the tariff for businesses increased by 25–80%, depending on the time of the day. Starting July 1, Ukraine reintroduced the full VAT on automotive fuel and excise tax, suspended after the invasion, resulting in a fuel price increase.

In Russia, the June 23–24 Wagner Group mutiny and the authorities’ reaction marked the most significant political crisis faced by President Putin during his 23-year reign. It challenged Kremlin’s positions inside and outside the country in the long term.

Antimigration rhetoric is getting stronger in Poland ahead of the fall parliamentary elections. Moldova’s Constitutional Court outlawed the Șor Party, which had organized numerous antigovernment protests. The court stated that the party, which is especially popular in areas populated by ethnic minorities, “militates against Moldova’s independence and sovereignty.”

Security & Access

Assessed control of terrain in Ukraine as of July 11, 2023, 3:00 P.M. ET. Russian-controlled Ukrainian territory before February 24, 2022, marked in black. Assessed Russian-controlled Ukrainian territory marked in red. Claimed Ukrainian counteroffensives marked in blue. © 2023 Institute for the Study of War and AEI’s Critical Threats Project

Kakhovka Dam Destruction: Security Overview

The Kakhovka Hydroelectric Power Plant (HPP) dam was destroyed on the morning of June 6, triggering a large-scale humanitarian and environmental disaster across southern Ukraine. The HPP is located in the Russian-held town of Nova Kakhovka in Kherson Oblast.

The HPP was one of the largest Ukrainian energy facilities, with a giant dam holding back a reservoir of about 18 cubic kilometers of water. Over 14 cubic kilometers, or 70% of the reservoir’s total volume, flooded the lowlands of Kherson and Mykolaiv oblasts. Almost 70% of the 600 km² flood-affected area is in the Russia-occupied left or southern bank of the Dnipro River in Kherson Oblast.

At least 17 people reportedly died from the flood, mainly on the left bank. Ukrainian authorities report six people being killed and 34 injured due to continuous shelling on June 6–12, targeting those evacuating from the disaster area. Following the explosion of the Kakhovka HPP, Ukrainian authorities and army representatives reported that Russian weapons warehouses storing ammunition and mines were washed away, flowing to the Black Sea. Landfills were washed away, too.

The incident displaced up to 4,000 people in Ukrainian-controlled areas, while information about and access to the Russian-held areas remained restricted. Tens of thousands lost their livelihoods, and millions experienced disrupted access to clean water across various regions of Ukraine, both upstream and downstream of the Kakhovka dam. Economic and environmental effects go far beyond Ukrainian borders and are still to be fully assessed.

Analysis & Forecasting

Before the dam was destroyed, Ukraine and Russia accused each other for months of attempting to destroy the dam. Satellite images suggest that its condition deteriorated over several days before the incident. Ukrainian authorities have accused Russian forces of destroying the dam with pre-installed mines, while Russia blames Ukraine. 

Although international humanitarian law prohibits attacks against dams, at least nine attacks against dams have been reported across the country since February 2022. Some recent notable incidents were reported on June 11 and May 25 in Donetsk Oblast and June 22 in Kryvyi Rih. The dam there had previously endured a missile attack on September 14, 2022, flooding 112 houses. About two-thirds of the Kryvyi Rih community suffered from severe water supply shortages due to the Kakhovka dam breach. In some cases, such attacks could intentionally flood the area and prevent ground combat advances by the opposite side. With ongoing hostilities and offensive operations, the likelihood of new attacks against dams remains high, particularly for those near the frontline.

The Beginning of the Ukrainian Counteroffensive

On June 4, Ukrainian forces reportedly initiated their first offensive operations in the southern direction of Zaporizhzhia and Donetsk oblasts. In the first three weeks, Ukrainian advances remained limited and localized. Ukrainian forces have reportedly re-established control over around 130 km² and at least nine small settlements in the area. Ukraine has been targeting military logistics deep inside Russia-controlled territory.

“The strike on the Chonhar bridge on June 22 was particularly crucial, as it serves as a vital connection between Russian-controlled Crimea and part of Kherson Oblast, facilitating the transportation of Russian military personnel and supplies to the occupied south of Ukraine.”

Unverified information suggests Ukrainian positions have been established on the eastern bank of the Dnipro River, near the Antonivka bridge. It suggests an upcoming intensification of hostilities in these directions, potentially leading to a significant escalation of the conflict in the weeks ahead and likely increased danger to civilians and aid actors in the frontline locations.

Analysis & Forecasting

The Ukrainian counteroffensive has been characterized by concentrated and targeted operations, albeit with a restrained allocation of military resources. Only three of the twelve combat-ready brigades were observed to be positioned at the onset of the counteroffensive. At this point, a significant shift in momentum has yet to occur, with Ukrainian forces prioritizing Russian infrastructure as targets, in anticipation of a substantial operation. According to observers, the purpose of the Ukrainian counteroffensive’s current phase seems to be identifying potential directions for future advances. Strikes targeting Russian military logistics, such as railway bridges, warehouses, and the Chonhar bridge, aim to weaken the Russian defensive infrastructure and supply lines. These actions likely indicate a strategic approach to erode Russian reliability of the rear before a larger offensive.

The Russian Aerial Attacks across Ukraine

Ukraine experienced several countrywide aerial attacks throughout June 2023. These air raids have damaged civilian and military infrastructure, leading to civilian casualties. One of the deadliest attacks occurred on June 13 in Kryvyi Rih, Dnipropetrovsk Oblast, resulting in the deaths of at least 13 civilians and causing significant damage to civilian and dual-use infrastructure. On June 27, a Russian ballistic missile hit a popular restaurant in the center of Kramatorsk city in Donetsk Oblast, killing 13 and injuring 60 wounded civilians, including children, journalists and NGO workers.

Three people died during a night strike at Kyiv city on June 1, 2023, near a closed bomb shelter. A nationwide inspection of bomb shelters revealed that 23.6% were unsuitable, and another 9.3% were nonoperational.

According to the Office of the United Nations High Commissioner for Human Rights (OHCHR), In June, there were 172 killed and 641 injured civilians. Since February 24, 2022, at least 9,177 civilians have been killed and 15,993 injured, including 287 casualties in Russia and two in Poland. 62% of the victims are men. Most casualties were registered in March–April 2022. The average monthly casualties have increased by 20% in the past two months from 696 to 836. OHCHR recorded that explosive weapons with wide-area effects, such as missiles, caused 90.5% of casualties.

A recent study by the Kyiv International Institute of Sociology shows that 78% of Ukrainians have relatives or friends who have been killed or injured since February 24, 2022.

Analysis & Forecasting

The recent aerial attacks in Ukraine have targeted many locations, focusing on Kyiv, Dnipro, Odesa and Kryvyi Rih. Although the attacks predominantly occur at night, a significant daylight missile attack in Kyiv coincided with the visit of a high-level delegation of African leaders on June 16. Russian Ministry of Defense has claimed to target Ukrainian militaries during the June 27 attack in the Kramatorsk city center. Such attacks are indiscriminate, directly violate International Humanitarian Law, and pose a severe threat to civilians and aid workers, especially in areas with a significant presence of combatants. 20% increase in civilian victims in May and June coincides with the preparation and launch of a Ukrainian counteroffensive, as Russian militaries are likely aiming to hamper the operation with air attacks. As the counteroffensive unfolds, we will likely witness more such attacks.

Countrywide Air Raids

Source: Air-alarms.in.ua

Politics & Governance

Reconstruction and Development

Despite ongoing hostilities and the unpredictable nature of the war, the June 21–22 Ukraine Recovery Conference in London gathered more than 1,000 public and private sector decision-makers, representatives of international organizations and civil society members from 60 countries to discuss joint efforts for a future reconstruction of Ukraine.

With overall damage caused by the invasion estimated at least $400 billion (and likely to reach more than $1 trillion), foreign donors pledged around one-sixth of this amount ($66 billion) during the conference. The biggest chunk, about $55 billion, will come from the European Union and be paid in installments until 2027. Among other big donors are the U.S., the U.K. and the World Bank. This assistance is critical for the Ukrainian government to cover urgent needs—$6 billion over the next 12 months. A $1.76 billion aid package from World Bank will help to finance different welfare schemes, such as pensions, unemployment or IDP support.

The Ukrainian government takes the lead in planning and coordinating reconstruction and development, creating the National Recovery Council (an advisory body under the president of Ukraine) and the State Agency for Reconstruction and Development. The Ministry of Communities, Territories and Infrastructure Development—The Ministry for Restoration in short—is supposed to coordinate the recovery projects with Ukraine’s local communities, feeding into a continuation of Ukraine’s decentralization reform launched after 2014. The Ministry of Finance is another government body playing a critical role in the process. In addition, donor countries created the Multiagency Donor Coordination Platform for Ukraine earlier this year, with the E.U. taking the lead.

Analysis & Forecasting

Ukraine remains highly dependent on foreign assistance, with international donors pledging support covering about 70% of its spending for 2023. For 2023 about $42.1 billion in foreign aid has been confirmed, while Ukraine’s state budget needs an estimated $59.3 billion. Several challenges remain with the government leading in planning and coordinating development initiatives. Coordination between multiple state bodies is one of them. For instance, the State Agency for Reconstruction and Development prioritizes projects to demine and restore critical utility infrastructure. Projects on demining will need to be coordinated with the Ministry of Defense, the State Emergency Service of Ukraine and the newly created Center for Humanitarian Demining.

Addressing corruption and fraud is another challenge. Ukrainian investigative journalists unveiled that the civil-military administration in Kyiv Oblast’s Hostomel community signed off quick reconstruction projects disregarding basic transparency standards, such as circumventing competitive selections and proper project oversight. In March 2023, the State Agency for Reconstruction and Development signed a memorandum on cooperation with the National Anti-Corruption Bureau of Ukraine (NABU), indicating the weight the agency gives to combatting corruption.

Another issue identified by the Agency head, Mustafa Nayyem, is limited experience and state capacities to absorb such an amount of money at both national and local levels. Many development actors have been aware of this problem from their experience implementing projects in Donetsk and Luhansk oblasts before 2022.

Attracting long-term private investors is another challenge. They are in no hurry to push too quickly to launch large-scale reconstruction projects in war-torn Ukraine, particularly not while hostilities are ongoing and show no signs of decreasing in the foreseeable time. The U.K. has pledged $25.4 million to boost access to the World Bank’s Multilateral Investment Guarantees Agency, which provides project political risk insurance. Germany provides German businesses willing to continue operating in Ukraine with insurance systems support against their financial risks under specific conditions. More governments joining efforts to provide businesses with relevant war insurance might boost investors’ confidence.

However, businesses might remain concerned about their potential payout vis-à-vis staff safety and sustainability of reconstruction projects closer to the frontline. They might be targeted throughout the reconstruction process or shortly after the finalization of the projects. Ukrainian authorities will likely continue struggling to find resources to reconstruct the most affected areas of the active hostilities in the east and southeast of the country.

Mobilization

Draft into the armed forces intensified in June. Reports from Ivano-Frankivsk, Kyiv and Chernivtsi suggest all men have been ordered to register at the territorial center for recruitment within ten days. Failure to do so is subject to administrative liability. Criminal liability arises when a person fails to appear on a military call-up.

On June 28, the Verkhovna Rada of Ukraine exempted men with relatives with disabilities from military service. The government also banned men subject to mobilization from working as security guards.

Analysis & Forecasting

The increased mobilization suggests a greater need for manpower and resources to strengthen the country’s defense capabilities and potentially plan for a larger-scale counteroffensive strategy. Increased mobilization may affect Ukrainian businesses and aid actors, as critical male staff may get drafted. It might also affect social cohesion, as many see avoiding mobilization as a lack of patriotism, and fuel the illegal market of deferment from military service, as the recent corruption scandal involving the head of the army recruitment center in Odesa indicates.

New Peace Initiatives

Leaders of six African countries—the presidents of the Comoros, Senegal, South Africa, and Zambia, as well as Egypt’s prime minister and top envoys from the Republic of the Congo and Uganda, met the Ukrainian president on June 16 and the Russian president on the next day to “restore a peace dialogue”. As the African continent’s food security is greatly affected by the war in Ukraine, most countries either stand against the war or maintain a policy of strategic nonalignment. A few countries, such as Mali and Eritrea, explicitly favor Russia’s position. Among the proposed measures were withdrawing Russian troops and tactical nuclear weapons from Belarus, suspending the I.C.C. arrest warrant for Putin and easing anti-Russian sanctions. The countries also called for an unrestricted agreement on grain and fertilizers. Africa has experienced a substantial rise in food, fertilizer and fuel prices, resulting in declining local living standards and triggering social unrest. Following the meeting in Kyiv, President Zelenskyi expressed skepticism, emphasizing that peace talks could only occur after Russia’s withdrawal from Ukrainian territory.

The envoy of Pope Francis came to Kyiv on June 5 to explore possible ways to achieve “just peace”. Cardinal Matteo Zuppi held discussions with several religious heads and met with Ukraine’s president. Zuppi’s itinerary in Moscow for June 28–29 remained strictly confidential. Ukrainian public trust in the Vatican decreased from 45% in 2020 to 3.1% in May 2023.

Analysis & Forecasting

With new peace initiatives by nontraditional regional players—China, African countries and the Vatican, Ukraine’s traditional Western allies continue providing military assistance and support Kyiv’s aspirations to join the E.U. and NATO. Despite continuous fighting, Kyiv and Moscow meet with peace envoys, probably willing to consider potential negotiation platforms for some time in the future or to currently discuss various topics, such as the exchange of prisoners, return of Ukrainian children or agriculture export.

Economy & Development

Main Indicators

In June 2023, consumer inflation in annual terms continued to slow down to 12.8% from 15.3% in May. Fitch forecasts that Ukraine’s GDP will grow by 3.5% in 2023, with inflation falling to 14.5% by the end of this year. From July, Ukrainians will face price increases in electricity and fuel. Hence the overall cost of goods and services will increase.

Source: State Statistics Service of Ukraine

Starting in June, electricity for households increased by 80%. From July, the tariff for businesses increased by 25–80% depending on the time of the day. As the government determines electricity tariffs in Ukraine, it has kept the prices at a minimum since the invasion. On top of that, starting July 1, Ukraine reintroduced the full VAT on automotive fuel and excise tax, suspended after the invasion, resulting in a fuel price increase. The price increase is part of the gradual move towards a market approach, a condition for the E.U. accession.

Economic Implications of the Kakhovka Dam Destruction

The National Bank of Ukraine (NBU) calculated that the destruction of the Kakhovka HPP will decrease annual GDP by 0.2% and increase inflation by 0.3%. Both are attributed to additional challenges for enterprises, the partial loss of the harvest and irrigation systems, loss of property and production facilities in flooded areas and potential increased migration. 

Although the flooded area is relatively small, numerous irrigation systems were linked to hydroelectric power plants. In southern Ukraine, where irrigation is crucial due to the arid climate, vegetables heavily rely on it for survival. The explosion of the Kakhovka HPP left 94% of irrigation systems without water in Kherson Oblast, 74% in Dnipropetrovsk Oblast and 30% in Zaporizhzhia Oblast. In the short term, reduced water consumption will affect the operations of metallurgical enterprises and agricultural and food processing companies in the country’s southeast. 

Ukraine has begun to calculate the damage. According to preliminary data, the agricultural sector will lose up to $10 billion over the next five years. Losses include damaged municipal infrastructure, energy facilities, power lines, water supply, sewage systems, housing, 1.5 million hectares of land out of use for agriculture and massive losses to the fishing industry.

Analysis & Forecasting

According to the Ministry of Agrarian Policy and Food, vegetable production in the right bank of Kherson Oblast, controlled by Ukraine, could decrease by 15–20% due to flooding. Farmers from other regions, primarily Odesa, have increased their crops of vegetables from the “borscht set” (potatoes, carrots, onion, beets, cabbage), cucumbers and tomatoes, which will likely prevent a market deficit. Additionally, Ukraine’s western and central regions will harvest in July, increasing the supply. Shortages are expected for melons, watermelons and eggplants. Growing these crops in other areas of Ukraine presents more significant challenges due to climatic conditions. The main alternative is import from Turkey. It will likely increase food prices by 18–20%.

Grain Deal

Since the beginning of May, the effectiveness of the corridor has declined, with only six vessels passing inspections per week, compared to six–eight per day in the fall. Russia has shown no interest in extending the deal, as it no longer relies on Ukrainian ports to export ammonia, as its largest producer, Uralchem, has found an alternative route. Uralchem will construct a specialized ammonia terminal on the Taman Peninsula on Russia’s Black Sea coast by the end of 2023, a substitute for the Odesa pipeline. The pipeline, passing through Ukraine, was damaged on June 5, just a few hours before the Kakhovka dam explosion.

Analysis & Forecasting

According to NBU, if the corridor is shut down, it will negatively affect Ukraine’s exports, with a corresponding decline in foreign exchange earnings and increased pressure on the hryvnia. Ukraine’s alternatives include exporting grain through the Danube River ports and the western border with the European Union. In early June, Polish farmers organized blockades to prevent the transit of Ukrainian grain, disregarding the authorization to transit through Poland to other E.U. countries. The strikes ended following a mirror blockade for Polish trucks on the Ukrainian side of the border.

Society & Environment

Venice Commission Statement on the National Minorities Law

Reform of the legal protection of minorities was among the seven recommendations of the European Commission, which Ukraine must implement to move towards E.U. membership.

In June, the Venice Commission, an advisory body of the Council of Europe, reviewed the newly adopted law on national minorities. It asked the Ukrainian government to revisit several provisions for full compliance with international standards. 

In March, a new law on national minorities came into force. On June 12, the Venice Commission, an advisory body of the Council of Europe, published an opinion on the law recognizing the guarantees it provides yet asking for a review of several provisions for full compliance with international standards. The Commission reiterated some previous criticisms of the linguistic rights and education sections. It recommended, among others, reconsidering “limitations of the freedom to use the minority language” and “differentiating between minority languages” and removing quotas in the access to mass media in minority languages.

The Commission’s opinion was met with backlash from some Ukrainian M.P.s and civil society. They highlighted the peculiarity of the Ukrainian case and the importance of protecting the Ukrainian language after centuries of Russification by the Soviet Union. On the other hand, Hungary and Romania have supported the Commission’s stance due to the significant Hungarian and Romanian minority populations in Ukraine. 

On June 22, President Zelenskyi signed a law banning the commercial import of books from Russia and Belarus. The law requires special permission to import books in Russian from third countries.

Analysis & Forecasting

Limiting the export of Russian-language books may affect those speaking the language. According to the most recent 2001 census, 30% named Russian their native language, with that share being higher in the east and south of Ukraine. However, a 2021 survey that excluded respondents in temporarily occupied areas showed a drop to 18%. The Ukrainian government is left in a difficult position. It must balance the need to protect postcolonial Ukrainian culture and award the same freedoms to many minorities in the country. The following steps will inform the E.U. and interested member states on how well Ukraine can balance its needs with partners and its diverse population. Furthermore, international actors, particularly those active in regions with linguistic minorities, must remain sensitive to the impact of language on social cohesion.

Environmental Updates

The destruction of the Kakhovka dam will lead to irreversible ecological consequences. Almost immediately after the dam’s breach, thousands of tons of oil, sediments, pesticides, debris and chemicals were pushed downstream toward the Black Sea due to flooding from the Kakhovka dam. This toxic mix has degraded the water quality and resulted in an ecological disaster. Numerous animals have drowned, including species on the verge of extinction that were kept in natural reserves in the south, wild animals, cattle and pets. Due to the flooding of forests, the Southern Forest Office predicts that a significant proportion of forestation in the affected region will die out. Forests are threatened by the degradation of the quality of the soil, rotting of roots, death of trees due to lack of oxygen, expansion of erosion and decreased fertility. Part of the regional ecosystem is lost forever.

Analysis & Forecasting

From a long-term perspective, the contaminated water may seep into the groundwater. If this happens, it may poison farmland, rivers and the Black Sea basin. According to an early assessment by the U.N., there may be long-term climatic changes in the region due to the loss of a large body of water. Already on June 18, satellite imagery showed the desiccation of the reservoir in line with the worst-case scenario predictions. Flooding of lands and draining of the reservoir can turn the most fertile region of Ukraine into a desert in as little as a year.

The dam’s breach stimulated discussions on the environmental impact of Russian aggression in Ukraine. A series of meetings were hosted between the government of Ukraine and international environmental specialists to better inform them of the scale of the ongoing “ecocide.” This disaster engaged climate activists previously silent on the war, like Greta Thunberg, who said, “ecocide and environmental destruction is a form of warfare … as Ukrainians by this point know all too well—and so does Russia,” during her Kyiv visit at the end of June.

One of the most significant concerns for the region’s security is how the destruction of the Kakhovka HPP affects the situation around the Zaporizhzhia Nuclear Power Plant, as all reactors of the plant are cooled down by a pool which was sustained with the water from the dam.

Neighboring Countries

Russia                                                                                

The Wagner Group mutiny shook Russia and challenged Kremlin’s positions inside and outside the country in the long term. Tensions between Wagner, the private military company set up by the Russian state, and the Russian Ministry of Defense (MoD) escalated for months and erupted on June 23–24. Armed with tanks and air defense systems, the Wagner Group left its bases in the occupied Luhansk Oblast. It took control of military bases in the Russian city of Rostov-on-Don, with a population of one million, and marched on Moscow. Within a day, a few thousand troops crossed around 800 kilometers. They stopped only 200 km south of Moscow without meeting any significant resistance from the Russian state, apart from several air raids, which stopped when Wagner downed one military plane and six helicopters killing at least fifteen Russian officers.

Source: @SIBYLLINE, June 26, 2023.

Yevgeny Prigozhin, a Russian businessman and the leader of the group, who portrayed the rebellion as a response to an alleged attack on his forces by the Russian military, demanded that Russian Defense Minister Sergey Shoigu and Chief of General Staff Valery Gerasimov be turned over to him. He criticized them for their “unprofessional” and “corrupt” approach to the war in Ukraine, which resulted in thousands of deaths of Russian soldiers. Although many observers believed the mutiny could result from elite conflict, Prigozhin is considered to have multiple allies within Russian security services, including the MoD leadership.

President Vladimir Putin publicly denounced the mutiny, calling Prigozhin, his long-term ally and owner of the Hero of Russia award, a “backstabbing traitor.” Russia Federal Security Service (FSB) opened a probe into an armed rebellion. Russian National Guard blocked roads leading to Moscow, and heavy military equipment was brought to Moscow to defend against Wagner. The mutiny stopped on the night of June 24, when Belarus leader Aliaksandr Lukashenka brokered a settlement with Prigozhin, who agreed to end the rebellion and bring his troops back to field camps, including some to Belarus. In return, the FSB closed the case. Putin met with Prigozhin and several other Wagner leaders in the Kremlin on June 29.

Analysis & Forecasting

Prigozhin did not oppose the war in Ukraine, and his actions did not significantly impact Russian tactical-level operations in Ukraine. The mutiny may further challenge Moscow’s long-term ability to conduct effective operations there. Wagner was considered one of the most successful Russian groups fighting in Ukraine, bringing the only military victory since the summer of 2022—capturing the town of Bakhmut in Donetsk Oblast in May 2023. According to observers, Prigozhin’s criticism of the MoD leadership resonates among many low and mid-level officers in the Russian army, making it even harder to motivate them to continue fighting effectively. Reports of major shake-ups in the leadership of Russian military operations in Ukraine come amid the Ukrainian counteroffensive.

The event may have implications for Russian foreign policy beyond Ukraine, as the Wagner Group is deeply involved as Russia’s proxy force in the Middle East and Africa, particularly in Syria, Mali and the Central African Republic.

The most significant long-term impact will likely be on Russian domestic stability. The mutiny and the handling of the situation marked the most significant political crisis faced by Putin during his 23-year reign, revealing the potential for a violent regime change and how poorly the Russian security apparatus was prepared for this. It is essential to monitor the complex dynamics inside Russia closely.

Poland                                                                                

The chairman of the ruling Law and Justice party, Jarosław Kaczyński—seen by many as the country’s de facto ruler—announced that a referendum on the E.U. relocation mechanism would be held this year, together with the fall elections, indicating a resurgence of the ruling party’s previous antimigration rhetoric. This rhetoric is separate from the government’s consistent support for receiving refugees from Ukraine. According to the polls, negative sentiments towards migrants from Africa, Asia and the Middle East are prevalent mainly among Law and Justice and Confederation voters and those above 60. The center-right Civic Platform—the ruling party’s main rival—surprisingly embraced the antimigration rhetoric, too, as on July 2, its leader Donald Tusk accused Law and Justice of lax migration policies and called for “taking back control” over the country’s borders.

Law and Justice is still heading in the polls at around 33%. The Confederation runs third in polls with 12% support. It’s the most popular party among men before 40. It has by far the most robust social media presence among all political parties in Poland, and in June, Facebook lifted the ban on its page that was in force since January 2022. The Confederation is behind the media campaign “Stop the Ukrainization of Poland,” and an antimigration rhetoric is a prominent part of their political identity.

Presidents of five European Parliament groups have called the OSCE to carry out a full-scale election observation mission amid “concern that the elections might not be held to the highest democratic standards” following the last month’s controversy over a state commission on investigating Russian influence (read more in UACAT’s May Context Report).

Analysis & Forecasting

The government’s antimigration rhetoric is at odds with its policies. Only in 2022, the government issued over 365,000 work permits for foreigners, only 23% of which were given to Ukrainian citizens. Permits issued to citizens of India, Uzbekistan, Turkey, Philippines, Nepal, Bangladesh, Turkmenistan and Indonesia make for almost half of all permits issued in 2022. As of 2021, Poland was the leader among residence or work permits issued among all E.U. countries, second only to Malta if relative to the population size. Despite the planned referendum, the sudden antimigration unison by most Polish political parties might decrease this topic’s prominence in the pre-election period. Some experts, however, speculate that migration will become the main polarizing topic ahead of the vote. Although refugees from Ukraine aren’t mentioned in this context, it’s unclear whether this taboo can be broken as the debate becomes increasingly heated.

According to the latest polls, Law and Justice would have to form an uncomfortable coalition with far-right Confederation to stay in power. At the same time, the Civic Platform wouldn’t be able to form a ruling coalition at all unless with the Confederation as well. An eventual third consecutive term in power for Law and Justice would be unprecedented in Poland’s democratic history.

Moldova                                                                              

On June 19, Moldova’s Constitutional Court outlawed the Șor Party, which has organized numerous anti-government protests. The court stated that the party, led by the Israel-based tycoon Ilan Șor, “militates against Moldova’s independence and sovereignty,” declared it “unconstitutional … and dissolved with immediate effect.” Although the party had only six members in the 101-member parliament at the time of the ruling, it has taken over from the Socialist Party as the most vocal and visible Russia-aligned party, with significant geographic strongholds, including the central Orhei district, Gagauzia, and southern regions with significant Bulgarian minority populations. Moreover, in November 2021, Șor’s Marina Tauber won the first round of mayoral elections in Moldova’s second-largest city, Bălți, with 48% of the vote, before being disqualified for illegal campaign financing.

Meanwhile, two Chișinău airport security staff were killed and a passenger injured when a man opened fire on them after being denied entry into the country on June 30. The shooter, identified as a 43-year-old citizen of Tajikistan, later died in hospital. While in this case, there do not appear to be any links between the shooter and pro-Russia elements within the country, the Moldovan authorities have increasingly taken steps to prevent the entry of foreign nationals with suspected ties to Russia from entering the country.

Analysis & Forecasting

The Șor Party, outlawing is likely less consequential than it seems. Șor M.P.s will keep their seats, taking the status of independents. Furthermore, Ilan Șor announced the formation of a new political bloc that would essentially take on the role played by Șor Party. While a constitution court expert expressed doubts that this will be allowed by the court, there appear to be other outlets for the Șor Party leadership to exert its influence, notably through taking over the structure of any dormant party still officially registered.

Trends to Watch

• Ukrainian forces switched from months-long defense positions to active counteroffensive operations in early June. These will likely continue focusing on the southern direction of Zaporizhzhia and Donetsk oblasts. Trying to hamper Ukrainian advances, Russian aerial attacks throughout the coming weeks will likely continue targeting warehouses, dams and bridges, resulting in civilian victims.

• Increased mobilization may affect Ukrainian businesses and aid actors, as critical male staff may get drafted, fueling the illegal market of deferment from military service. It might also affect social cohesion, as many see avoiding mobilization as a lack of patriotism.

• Despite continuous fighting, Kyiv and Moscow continue engaging with various peace envoys, probably willing to consider several potential negotiation platforms.

• As Ukraine still faces a budget gap of more than $9 billion and military expenditures continue to rise, the Ukrainian government will likely continue lobbying among its Western partners to increase the current pledged sum of $42.1 billion. 

• Limiting the export of Russian-language books may affect those speaking the language. International actors, particularly those active in regions with linguistic minorities, must remain sensitive to the impact of language on social cohesion.

• Although the Wagner Group mutiny in Russia did not significantly impact Russian tactical-level operations in Ukraine, it may even challenge Moscow’s long-term ability to carry out effective operations there. It may have implications for Russian foreign policy in the Middle East and Africa, as the Wagner group is deeply involved there as Russia’s proxy force. The most significant long-term impact will likely be on Russian domestic stability. 

• The Polish debate on migration from Muslim countries might become heated before the fall elections. If the scope of the debate expands to a broader labor market discussion, the policy of receiving Ukrainian refugees might fall under public scrutiny for the first time.

• Though officially banned, the leadership of the Șor Party will likely maintain its capacity to hold antigovernment protests and continue to exert influence in Moldova, including during the September local elections in Moldova’s second-biggest city Bălți.