A Ukrainian official with a long history of defending corruption resigned on Monday from a government agency overseeing reconstruction work in Ukraine financed primarily by the West, citing mismanagement of funds. His departure highlights tension within President Volodymyr Zelensky’s government over the allocation of wartime aid.
The official, Mustafa Nayyem, who had been head of the State Agency for the Restoration of Ukraine, did not allege any blatant embezzlement. But allegations of abuse and mismanagement threatened to delay the administration’s efforts to calm concerns among the United States and other allies about providing billions in aid to Ukraine’s war effort.
He was the second senior official involved in Ukraine’s reconstruction effort to depart in the last month, following the firing in May of Oleksandr Kubrakov, the infrastructure minister. Kubrakov’s ministry oversaw the agency headed by Nayyem.
Kubrakov was perceived in Kiev political circles as a figure aligned with the United States on spending priorities for reconstruction aid, a stance that irritated other government leaders who resented what they saw as intrusive American oversight. Both he and Nayyem had spoken out against bribery in the construction business.
The Agency for the Restoration of Ukraine was created during the war to streamline and safeguard funding for reconstruction, which is expected to eventually attract tens of billions of dollars in foreign aid, given the scale of wartime destruction. . Ukraine and some allies are promoting the seizure of Russian assets to finance the work.
Preventing abuses has been a priority for American policymakers, and was a concern raised by members of Congress while debating a $61 billion military and financial aid package earlier this year. That package was finally approved in late April.
The reconstruction agency that Nayyem had headed oversaw a budget last year of 100 billion hryvnia, the Ukrainian currency, or about $2.5 billion, largely financed, like most non-military spending in Ukraine, by foreign aid.
His projects were far-reaching. The agency funded efforts to build physical barriers to protect vulnerable electrical equipment at power plants, in cases where air defense systems failed to protect the sites. The agency repaired water pipes, bridges and roads.
In a telephone interview and in a letter explaining his resignation posted on Facebook, Nayyem did not cite any specific cases of corruption. Instead, he listed what he claimed were a series of bureaucratic obstacles in the way of the agency’s work, delaying project approvals and payments to contractors. Agency staff salaries were cut, he said, in what he called an effort to undermine the organization’s work.
“Since November last year, the agency team faced constant confrontations, resistance and artificial obstacles,” he wrote in his Facebook post.
Zelensky’s office did not immediately respond to a question about Nayyem’s resignation or allegations of mismanagement.
Despite the setbacks, Nayyem said, most of the projects were completed.
Last fall, Nayyem reported two members of Parliament to anti-corruption authorities over accusations that they had attempted to pay a bribe. Those cases are now in court.
Foreign aid had been a sensitive issue in Ukraine for years before the war, and Ukrainian leaders rejected Western efforts to leverage aid as a way to guide personnel policies or support government reforms that threaten vested interests.
Nayyem described bureaucratic procrastination that was apparently aimed at sidelining the reconstruction agency’s work.
“Transparency and predictability in this issue are crucial because the money comes from taxpayers,” Nayyem said in the interview. “The greatest asset we have now is trust. And at this moment, those who tried to make this system transparent and accountable had to go.”
Nayyem’s resignation came at an awkward time, coming a day before a major donor conference on reconstruction in Berlin. Ukrainian authorities had excluded him from the delegation, disrupting meetings he said he had scheduled with foreign officials about donations for Ukraine’s reconstruction.
On Monday afternoon, Nayyem and the government were in open disagreement over why he had been excluded from the delegation. Government officials told Ukrainian media that the prime minister had scheduled a meeting with Nayyem for Wednesday, while Nayyem said he had never received such an invitation.
Despite the urgent need to repair damage to power plants, roads, bridges and water supply systems damaged by Russian missile attacks, contractors were not paid for months, Nayyem said in the interview. Some projects stalled for lack of payment, he said.
The agency had financed some military fortification works in the Sumy region of northeastern Ukraine and the Donetsk region of eastern Ukraine. Nayyem wrote in a letter explaining his resignation that payments for these contracts and others had been “delayed for months.”
“All this negatively affects the country’s defense capacity,” he wrote.
The projects that were completed, he said, included the construction of protective barriers around electrical equipment at 103 sites, to protect machinery from shrapnel. The barriers helped protect against missile attacks in three regions, she said, allowing engineers to restore power more quickly.
Given the tangle of government permits and deals with construction companies needed to repair war damage, some setbacks are inevitable, said Tymofiy Mylovanov, Ukraine’s former economy minister. “It’s a war environment, so not everything works well. You’re solving problems all the time.”