DONETSK FINANCIAL INDUSTRIAL GROUPS CONSOLIDATION AT THE TURN OF THE XXI CENTURY

Abstract

The article investigates the processes of the powerful financial industrial groups emerging in the Donbass region throughout the 1990-ies. It is stated that Donbass regional significance drastically raised with Ukraine’s gaining independence due to fuel resources concentrated in the region and critically important for state fuel and energy supplies. The research specifically focuses upon the miner unions movement, its role in gaining Ukraine's independence, its further evolution and impact it had upon the regional elite formation. The first Donetsk elite’s representative to ever acquire a top position in Kyiv was Yuhym Zviahilskiy, the Zasiadko mine’s former director. What boosted his rapid promotion was his cooperation with the Ukraine’s President Leonid Kuchma seeking allies for his fight with the Dniepropetrovsk clan. The whole variety of the turn-of-the-century financial industrial groups is arguably divided into the following categories: 1) source-based groups (emerging mostly around coal mining and ore extraction industries typical for the Donbass region); 2) defense industry-based groups with former Komsomol and Party leaders in charge; 3) groups based on legal and secretive agencies (mostly known for Victor Medvedchuk and Surkis brothers’ activities); 4) Pavlo Lazarenko’s proto-agrarian clan. The establishment of System Capital Management, Donbass Industrial Union, Altcom corporations is described with direct reference to Rinat Akhmetov, Serhii Taruta, Vitalii Haiduk, Borys Kolesnikov's roles in this process. The genesis of the groups under consideration is specified through their key industrial assets, affiliated banks, legal status, transregional and international expansion. The "old elite" (mostly related to the criminal syndicates) to the "new elite" (based on income legalization through financial industrial groups and international business) generational shift is explored. Three basic stages of Donetsk clan establishment have been identified: 1) the "mafiosi wars" of the first half of the 1990-ies; 2) consolidation and driving the "old guards" out of regional political and economic field (1995 - 1999); 3) the ultimate establishment of financial industrial groups pursuing their own economical and political interests (early 2000-ies). The author argues that continuous fights between the regional mafiosi groups searching for a common spokesman was one of the reasons for “the Donetsk gang’s” belated engagement into struggle for political influence and Ukraine’s finance and economic markets reallocation.