Ukraine Recruiting Its Oligarchs To Prevent Pro-Russia East From Seceding

After losing control of Crimea, Ukraine's embattled new government is turning to the nation's oligarchs to stamp out the flames of separatism in the mainly Russian-speaking east.

The fledgling leadership has appointed tycoons to head up the Donetsk and Dnipropetrovsk regions -- once bastions of support for Kremlin-backed former president Viktor Yanukovych.

The 58-year-old leader of the Industrial Union of Donbass, Sergiy Taruta, is the new governor in the rust belt region of Donetsk, which has been in upheaval since Yanukovych fled to Russia.

Taruta's net worth is estimated by Forbes magazine at $600 million (435 million euros) and his nomination has been supported by Rinat Akhmetov, the wealthiest man in Ukraine.

The influential Akhmetov himself helped bankroll Yanukovych's Regions Party and like Yanukovych is a Donetsk native. But he has been quick to distance himself from the ousted president.

Akhmetov has called the use of external force in Ukraine "unacceptable" -- a reference to the de facto takeover of the Crimea peninsula by Russian forces over the past week.

In Dnipropetrovsk, the new governor is Igor Kolomoiski, 51, who is co-owner of the powerful Private banking and metal industry holding.

A leader of Ukraine's Jewish community, Kolomoiski is worth $2.4 billion.

With that kind of money, analysts say, it is hardly surprising that business leaders in the country have an interest in stability.

"The oligarchs have every interest in maintaining the sovereignty of Ukraine. Under (Russian President Vladimir) Putin, they would lose their power and their business," Taras Berezovets, a political expert, told AFP.

- Putin 'has gone mad' -

The two tycoons said they were accepting the governor posts to counter Russia's plan to spread its influence in southern and eastern Ukraine.

Kolomoiski in particular has been vocal in his opposition, saying: "Putin is not normal."

"He has gone mad with his mission to re-establish the Russian empire," he said.

"Separatism will not pass in Dnipropetrovsk," Kolomoiski has said, adding: "This risks provoking a catastrophe on a global level."

Putin himself responded by calling Kolomoiski "garbage" and a "scoundrel".

Taruta said a decision by the Russian parliament authorising Putin to use force in Ukraine was "horrible" and stressed that Ukraine's "economic weakness" made it vulnerable to such a threat.

Three months of deadly anti-Yanukovych protests in Ukraine have seen violence unheard of in Europe since the wars in the Balkans and have pushed the ex-Soviet republic to near-bankruptcy.

The new government lacks "efficient levers in the pro-Russian east and south", said Volodymyr Fesenko, a political analyst.

"The elites linked to (Yanukovych's) Regions Party are demoralized, as are local administrations and law enforcement," he said.

"They are scared to act, not knowing who will be in power tomorrow".

The oligarchs who control Ukraine's economy employ hundreds of thousands of people and have long-established links with regional elites and law enforcement, helping control the regions.

- 'Colossal' resources -

In the eyes of the many Ukrainians disgusted with corruption, oligarchs in power are less likely to try to enrich themselves even more because of their already substantial fortunes.

"They have colossal administrative and financial resources," said online business journal Ekonomichna Pravda.

It said political power for the oligarchs was a chance for a "whitewash" for the many implicated in Yanukovych's corrupt schemes.

Some analysts warn there is a risk the new authorities could be creating "fiefdoms" and breaking promises made time and again to protesters to do away with corruption.

"The tycoons will want guarantees on security in exchange for their service," Fesenko said.

"The common interest at the moment is preserving the unity of the country," he said.

Berezovets said the power of the oligarchs will hinge on the choice of the next president, who is due to be elected in a vote on May 25.

The analyst said the tycoons would maintain or increase their influence if former boxer turned protest leader Vitali Klitschko wins.

That would not be the case if the winner is Petro Poroshenko -- himself an oligarch who helped fund the protests with a fortune made in the chocolate and auto industries.