This week, a significant personnel reshuffle of the Cabinet of Ministers of Ukraine is expected to occur. According to government officials, the composition of the Government will be changed by more than 50%. The main reason for these rotations is additional funding from allies against an increasing budget deficit, reaching UAH 500 billion (USD 12 billion). In this regard, the Ukrainian leadership is forced to replace certain officials whose work only partially satisfies Western partners, both in the Government and the Office of the President. The new personnel changes are expected to improve control over expenses and are associated with establishing new management balances, ensuring progress in Ukraine's accession to the EU, and reducing costs (the staff may be reduced by 30%-50%).
In addition, the authorities' reformatting of the current composition of the Cabinet of Ministers is also an attempt to remove the accumulated negativity in society.
It is preliminarily known that the following will retain their positions: Prime Minister D. Shmyhal and Minister of the Cabinet of Ministers O. Nemchinov. The following will be dismissed: Deputy Prime Minister, Minister for Reintegration of the Occupied Territories I. Vereshchuk, Minister of Environmental Protection and Natural Resources R. Strelets, Minister of Justice of Ukraine D. Maliuska, Minister of Foreign Affairs D. Kuleba, and others. A promotion is expected: the current deputy, A. Sybiga, may become the head of the MFA. Deputy Head of the Office of the President O. Kuleba may be appointed Minister of Regional Policy. O. Stefanishyna may be the Minister of Justice and Deputy Prime Minister for European Integration. O. Kamyshin (Minister for Strategic Industries) may become Deputy Head of the Office of the President instead of the recently dismissed R. Shurma.
The main intrigue of the personnel changes in the Government was D. Shmyhal's resignation and possible replacement by the First Vice Prime Minister of Ukraine, Minister of Economy Y. Svyrydenko—which has not yet taken place. According to the media, D. Arakhamia, with whom he has a trusting cooperation, allegedly attempted to prevent Prime Minister D. Shmyhal's dismissal.
The situation around the reformatting of the Government may indicate that V. Zelensky's team has not yet managed to completely stop the developing parliamentary crisis, which is further evidenced by the failure of the vote on September 4 to dismiss individual ministers. To make the necessary decisions, the President has to consider the opinions or negotiate with representatives of separate centers of influence in Parliament, such as the head of the faction D. Arakhamia or other representatives of the "Servants of the People."
On the front, the main battles continue in the Donetsk region. The Russian Federation has slowed the pace of its advance in the Pokrovsk direction, but the situation remains difficult for Ukrainian troops. In the Pokrovsk direction, Ukraine is still holding the town of Grodovka. However, the Russian Federation is trying to take the town of Selydove to advance through the settlements of Novogrodovka and Selydove to the southwest, bypassing from the rear (from the west) the line of fortifications of the Ukrainian Armed Forces, which were built on the higher western bank of the Volchya River (with support from the settlements of Ukrainsk and Gornyak). From the side of the settlement of Memrik, the Russian Federation is attacking the settlement of Ukrainsk. Russian troops approached the settlement of Galitsinovka and effectively cut off one of the last roads along which supplies were being sent to the settlement of Karlovka. As a result, the Ukrainian Armed Forces found themselves under threat of encirclement in the settlement of Karlovka and left the settlement.
The entire central sector of the Donetsk front line (Galitsynivka - Nevelskoye - Krasnogorovka - Georgievka) is under threat of collapse due to the offensive of Russian troops in the north and south. As Russian forces advance, the Ukrainian Armed Forces units located east of the Russian army's line of movement are forced to retreat to avoid being surrounded. However, the situation is not catastrophic at the moment since the northwestern part of the city of Krasnogorovka north of the Lozovaya River, along which the road to Zoryanoye-Kurakhovka runs, is still holding out. The situation in this area could become critical for the Ukrainian troops if the positions in Zhelannoye 1 and 2 and the city of Krasnogorovka are lost.
The situation near Ugledar is becoming more complicated. Russian troops are trying to bypass the city from two sides - at Prechistovka (west of Ugledar) and in the Vodyanoye area to the northeast. Also, Russian troops captured the village of Konstantinovka and cut off the highway from the town of Ugledar to the village of Konstantinovka.
Pressure has increased in the Kupyansk direction, where the Russian Armed Forces are trying to break through towards the Oskol River. Here, the Russians announced the capture of the settlement of Stelmakhovki. They advanced more than two kilometers from the settlement of Peschane, and a little further south—in the settlement of Andreyevka—Russian troops occupied the bank of the Zherebets River.
The fighting continues without significant territorial changes in Toretsk, Krasnogorovka, and Chasova Yar.
The Russian offensive has significantly accelerated its advance since the start of the Kursk operation in the New York-Avdiivka-Staromikhailovka-Pokrovsk zone. If we consider by month (in km²): January: 5; February: 95; March: 19; April: 60; May: 74; June: 49; July: 83; August: 242. (calculated based on the DeepState map).
At the current rate of advance, Russian troops may enter the Dnipropetrovsk region as early as spring 2025. The possible loss of Pokrovsk, a strategically important city and one of the key railway and road hubs in the Donetsk region, will threaten the logistics of the entire region and open the road to the city of Dnipro for the Russian Federation.
Ukraine continues consolidating its position in the Kursk region, where active advancement has largely stopped. Ukrainian troops have completed the cleanup along the Malaya Loknya – Pokrebki line and now control an area of about - 908 km², gray zone -337 km², so the total area is about 1245 km². (calculated based on the DeepState map). Ukrainian President V. Zelensky has officially stated that he is not going to leave these territories until the end of hostilities; they will be held for as long as the Ukrainian military forces allow.
This year's military phase may peak at the beginning of autumn when Ukraine and the Russian Federation will try to invest all their resources to achieve the maximum result on the front. This is connected, first of all, with the election campaign in the USA and the subsequent reassessment by Western partners of the situation in Ukraine as a whole.
Western media have increasingly begun to publish articles criticizing the Ukrainian leadership for the decision to send troops to attack the Kursk region rather than defend the city of Pokrovsk (Donetsk region), which is generally a marker of the somewhat skeptical attitude of some Western and world elites to this initiative on the part of Ukraine. Thus, the Western press has begun to write that the Kursk offensive is essentially over, and the Ukrainian Armed Forces are starting to suffer severe losses there, and they are also already running out of ammunition. Moreover, as the situation around Pokrovsk worsens, Ukraine will be forced to use everything it has to stop the Russian offensive.
It is also emphasized that the Kursk operation has put the peace talks track on hold. As long as the Ukrainian Armed Forces control the Russian Federation's territory in the Kursk region, there will be no peace talks with Ukraine; Russian President V. Putin made such a statement. The Russian Federation clarified that it would not resolve the Kursk issue to the detriment of the offensive in Donbas.
Despite this, Ukraine continues working on a comprehensive document for the Second Peace Summit. As Ukrainian President V. Zelensky reported, the entire document, agreed upon with the allies, will include energy issues, maritime security, prisoner exchanges, and the return of Ukrainian children. Other points (withdrawal of Russian troops, reparations, punishment of war criminals, etc.), which have caused much debate among the countries of the Global South, have not yet been considered.
However, Ukraine must still be ready to make territorial concessions to the Russian Federation. Ukrainian President V. Zelensky once again emphasized that he is not prepared to give up territories in the framework of any negotiations, including if Ukraine is promised accession to NATO (he stated this during a press conference on August 27, 2024). At the same time, Ukraine notes that the Russian Federation should be present at the second peace summit (Ukrainian President V. Zelensky spoke about this back in July 2024).
For its part, the Russian Federation refuses to conduct peace negotiations with Ukraine due to the invasion of the Ukrainian Armed Forces into the Kursk region.
Also, the Russian Federation will not attend the second peace summit "if it follows the same logic as the first summit," as stated by the head of the Russian Foreign Ministry, S. Lavrov. He called on Western countries to hold "honest" negotiations but without "papers" called the "Zelensky formula" (which implies the Russian Federation's capitulation).
In practice, the difference in the already stated positions of both Ukraine (which continues to insist on the withdrawal of Russian troops from its entire territory) and the Russian Federation (the ultimatum to recognize five regions of Ukraine as Russian) and the absence of any points of contact between them remains relevant today.
Constructive clarity in the peace process should be expected closer to the American elections since the new US President will ultimately become the primary judge in peace negotiations. And until the direction of US foreign policy is finally determined, all the principal negotiators on Ukraine, including China, will mainly be in a wait-and-see position. During this period, Ukraine and the Russian Federation will strive to achieve maximum results on the front, subsequently determining the degree of forced compromises for each party.
Tragedy in Poltava. As a result of a missile strike on the Institute of Communications in Poltava, more than 50 people were killed and 219 were injured during the military formation (Defense Ministry spokesman D. Lazutkin reported on the air of the all-Ukrainian marathon "Unified News"). The State Bureau of Investigation opened a case on the negligence of the military (Part 4 of Article 425 of the Criminal Code). This is far from the first tragedy of this kind.
Let us recall that similarly: on May 17, 2022, the Russian Federation struck the Desna training center in the Chernihiv region. And on November 3, 2023, it struck fighters of the 128th brigade during formation in the frontline zone in the Zaporizhia region.
The repetition of this tragedy does not simply mean the mistakes of individuals; it means that military regulations have not yet established a strict ban on the mass formation of military personnel, especially in the frontline zone, in the zone of destruction by enemy artillery.
It is noteworthy that the scale of the tragedy is such that this time, the country's information leadership is the first to react to maintain control over the information environment. That is why President V. Zelensky himself voices the first figures on the dead and wounded. This indicates that the scale of the tragedy is enormous, and there is no way to hide it.
The Russian Federation continues its strategy of regular missile and drone attacks on Ukraine to break the will of the Ukrainian leadership and society to wage war by inflicting maximum economic, military, and infrastructural damage - to create a humanitarian crisis, sow panic, cause significant damage to the energy sector and stop the work of the industry that serves the interests of the Armed Forces of Ukraine, etc. Kharkiv, Kyiv, Odesa, Dnepropetrovsk, and other regions are now subject to frequent shelling (several times a week). The strikes are mainly on energy infrastructure facilities and the military-industrial complex. As reported by the President of Ukraine, V. Zelensky, last week alone, the Russian Federation used more than 160 missiles of various types, 780 guided aerial bombs, and 400 attack UAVs of multiple types against Ukraine.
Patriot missile systems (SAM) will not be able to protect Ukrainian energy facilities by 100%; the percentage of downing maybe 60-80%.
The head of the Ministry of Energy, G. Galushchenko, warned Ukrainians that the new winter will be more complex than the previous one. After massive missile attacks, a "difficult" situation is developing in the energy sector. Ukraine has lost half of the energy capacity needed to ensure the winter period.
According to the National Bank of Ukraine, another 400,000 people will likely leave the country in 2024 due to power outages and infrastructure damage because Ukraine will only be able to build up the required additional energy capacity and solve the problem of power outages after winter. The ongoing uncertainty caused by Russian shelling will make it difficult for Ukrainians to plan their short-term prospects.
President V. Zelensky, commenting on the attacks on Ukrainian cities, once again called on Western countries to allow strikes with their long-range weapons on the territory of the Russian Federation, as well as to speed up the transfer of the promised air defense systems. In Ukraine, the issue of allowing strikes on the territory of the Russian Federation with Western weapons is regularly raised, and negotiations on this with representatives of Western countries are underway. Representatives of the Ukrainian leadership even presented the administration of US President J. Biden with the goals that they can strike in Russia if Washington lifts its restrictions. But the White House has not yet said that it is considering any plan to change its policy, fearing a new round of escalation and the involvement of Western countries in the war with Russia. Another argument against allowing it is that Russia has already withdrawn 90% of its strategic military equipment from the range of long-range missiles.
Ukraine is intensifying drone attacks on Russian territories. The Ukrainian drone raid on Russian regions on the night of September 1 was the largest since the beginning of Russia's full-scale invasion of Ukraine. The Russian Defense Ministry claims that 158 drones were shot down in 15 regions of Russia. Drones hit the oil refinery in Kapotnya and the Konakovskaya State District Power Plant in the Tver Region. The fact that the Ukrainian Armed Forces were able to launch so many drones at targets on Russian territory at the same time was the result of a large-scale defense program for the development and production of drones.
The development and production of drones in Ukraine are increasing, and in the future, raids in the Russian Federation may become larger and more frequent.
Ukraine lost its first plane, the F-16. The Ukrainian F-16 was reportedly shot down by the Patriot air defense system (member of the Verkhovna Rada Defense Committee Maryana Bezugla reported this). The deceased pilot, Oleksiy Mes, was one of ten Ukrainians who underwent an accelerated training program before entering combat, which is now an element of additional risk. Let us recall that the biggest problem for Ukraine now is training pilots; by the end of the year, there are expected to be about 20 of them (taking into account that two service one aircraft). One F-16 requires dozens of support personnel. The rapid loss of F-16s in Ukraine has caused information dissonance in the Western press, which also creates negative consequences for the reputation of President V. Zelensky’s team.
President V. Zelensky dismissed Ukraine's Air Force Armed Forces Commander-in-Chief, N. Oleshchuk. The corresponding decree was published on the website of the Office of the President of Ukraine. It is noteworthy that after the plane crash, F-16 N. Oleshchuk was criticized by MP Maryana Bezugla (who is associated with the head of OP A. Yermak). She stated that the Ukrainian Patriot air defense system shot down the Ukrainian F-16 aircraft. And this was not the first criticism from M. Bezuglaya against the Commander-in-Chief of the Armed Forces of the Ukrainian Armed Forces. Thus, earlier, she accused N. Oleshchuk of failure to prepare for the acceptance of the F-16. M. Bezuglaya also stated that the Air Force leadership falsifies the statistics of missile hits, calling the missiles that hit their targets "debris." According to her, in addition to falsifying statistics, Ukrainian air defense crews need to be better equipped and better coordinated with each other.
Criticism from M. Bezuglya becomes a kind of "black mark" for the military leadership and a harbinger of an imminent resignation; with its help, the OP indirectly expresses its dissatisfaction with the work of the army leadership. In June, after criticism from M. Bezuglya, the Commander-in-Chief of the Joint Forces of the Armed Forces of Ukraine (AFU), Yuriy Sodol, was dismissed from his post. Even earlier, the former commander-in-chief of the AFU, V. Zaluzhny, came under criticism from M. Bezuglya and lost his post. The new commander-in-chief of the Ukrainian Armed Forces, A. Syrsky, has also recently been criticized by M. Bezuglya. Still, his dismissal may occur if the Kursk operation fails (it is only possible to hold positions once the US elections) or if the Donetsk front collapses in the area of Pokrovsk.
The Parliament failed to adopt bill No. 11416-d on increasing taxes, which will limit the possibility of additional financing of the state budget by UAH 30 billion (considering the overall deficit of UAH 500 billion). 224 deputies voted for the corresponding decision out of the required 226 votes. The bill was sent for a second first reading. As the head of the Finance Committee, D. Getmantsev, stated, the probability of underfunding the army has now increased.
The bill's key provision is to increase the military tax from 1.5% to 5%. This should have brought in UAH 27.3 billion in additional revenue by the end of the year.
Military tax for sole proprietors—For single taxpayers of groups I, II, and IV, the tax will be 10% of the minimum monthly wage (currently UAH 8,000; therefore, the tax amount will be UAH 800).
Military tax is 1% of income for single taxpayers of group III (individual entrepreneurs and legal entities).
The new version of the bill removed some tax points and added new ones—a 50% income tax for banks in 2024 and a 25% tax for non-banking financial companies and organizations.
Overall, the planned cash receipts from the law on increasing taxes decreased four times. At first, the Ministry of Finance reduced the expected receipts from 125 billion UAH to 57.5 billion and then to - 30 billion UAH.
In August 2024, total revenues to Ukraine's budget amounted to UAH 527.7 billion. Of these, total domestic revenues for August were UAH 181.7 billion. Customs: +51.1 billion UAH, which is -7.8% of the plan (-4.4 billion); tax: +101.5 billion UAH, which is +4.7% of the plan (+4.6 billion UAH); and government bonds: +29.1 billion UAH.
External aid for the last summer month is $8.4 billion or—UAH 346 billion. Here, from the EU—$4.5 billion and the USA—$3.9 billion. More was only in March of this year—$9 billion.
But let us recall that foreign financing remained low a month earlier, in July. In July, the revenues of the Ukrainian budget did not cover its expenses by - 14 billion UAH. So, the budget expenses for July amounted to - about 264 billion UAH. Let us recall that Ukraine's budget received 240.5 billion UAH. Of this, 90 billion UAH (37%) or 2.2 billion dollars is external support. And 150.5 billion dollars (63%) are domestic receipts.
More details on international financing will be in August. In early August, Ukraine received $3.9 billion in a non-repayable grant from the United States through the World Bank, Prime Minister D. Shmyhal reported. This money will be used to pay salaries and social benefits to public sector employees. The total amount of planned assistance under this program until the end of the year is $7.8 billion. In August, the EU approved the first regular payment for Ukraine of 4.2 billion euros in a regular tranche within the framework of the 4-year Ukraine Facility program for a total of 50 billion euros (17 billion euros in grants and 33 billion euros in loans). The funds will be used to support Ukraine's macro-financial stability and the functioning of its public administration.
Earlier, Finance Minister Serhiy Marchenko said that financial assistance from the EU will be the largest in volume and reach 16 billion euros in 2024, provided that Ukraine fulfills the indicators of the Ukraine Plan. The total budget financing through foreign aid is expected to be $38 billion.
Maps of military operations.
Kursk region.
Donetsk region
Internal situation.
Personnel rotations in the Cabinet of Ministers of Ukraine.
A major personnel reshuffle of the Ukrainian Cabinet of Ministers is expected to take place this week. As reported by the head of the Servant of the People faction, David Arakhamia, the composition of the Government will be changed by more than 50%.
Potentially new personnel rotations in the Government should improve control over spending. They are mainly related to establishing new management balances, ensuring progress in Ukraine's accession to the EU, and reducing costs (personnel may be reduced by 30%- 50%).
It is preliminarily known that the following will retain their positions:
Prime Minister D. Shmyhal
Minister of the Cabinet of Ministers of Ukraine O. Nemchinov
First Vice Prime Minister of Ukraine – Minister of Economy Yulia Sviridenko (she was tipped for the post of the new Prime Minister)
Deputy Prime Minister for Innovation, Development of Education, Science, and Technology, Minister of Digital Transformation M. Fedorov
Minister of Finance S. Marchenko
Minister of Defense R. Umerov
Minister of Health V. Lyashko
Minister of Energy G. Galushchenko
Minister of Social Policy Oksana Zholnovich
Minister of Internal Affairs Igor Klimenko
Minister of Education Oksen Lesnoy
The following will be dismissed:
Deputy Prime Minister, Minister for Reintegration of the Occupied Territories I. Vereshchuk
Minister of Environmental Protection and Natural Resources R. Strelets
Minister of Justice of Ukraine D.Malyuska
Minister of Foreign Affairs D. Kuleba
Acting Head of the Ministry of Agrarian Policy - T. Vysotsky
Head of the State Property Fund V. Koval (may be transferred to the Ministry of Agrarian Policy).
New appointments:
A. Kuleba will become the Minister of Regional Policy
S. Grinchuk (Deputy Minister of Energy) may become the Minister of Ecology
A. Sibiga, Deputy Head of the Ministry of Foreign Affairs, may become the head of the Ministry of Foreign Affairs.
Minister of Infrastructure – A. Pertsovsky
The following will be promoted:
O. Stefanishyna will hold the post of Minister of Justice and Deputy Prime Minister for European Integration.
A. Kamyshin (Minister for Strategic Industries) - may become Deputy Head of the Presidential Office instead of the dismissed R. Shurma.
The main intrigue surrounding the personnel changes in the Government is the resignation of D. Shmygal and his replacement by Yu. Sviridenko—apparently has not yet taken place. D. Arakhamia, with whom, according to the media, he has a trusting cooperation, allegedly attempted to prevent Prime Minister D. Shmygal's dismissal.
The situation around the reformatting of the Government may become a marker that V. Zelensky's team still needs to manage to completely stop the developing parliamentary crisis. To make the necessary decisions, the President has to consider or negotiate with representatives of individual centers of influence in the Parliament, such as the head of the faction, D. Arakhamia, or other representatives of the "Servants of the People."
The situation around Ukraine.
Russian President V. Putin's visit to Mongolia sets a precedent for ignoring the International Criminal Court's decision.
On September 3, the planned visit of Russian President V. Putin to Mongolia took place at the invitation of President Ukhnaagiin Khurelsukh. This will be the first visit of the Russian President to a country that is a member of the International Criminal Court (ICC). Mongolia, being a signatory to the Rome Statute, must comply with the order of the International Criminal Court and arrest V. Putin since the Court issued an arrest warrant for him on suspicion of committing war crimes due to the policy of deportation of Ukrainian children. But the Mongolian authorities are not going to do this. The ICC has already issued six arrest warrants for Russian aggression, both for Russian President V. Putin and other high-ranking Russian officials.
In theory, all member states of the International Criminal Court are now formally legally obliged to detain suspects and bring them to trial. As of 2024, 137 states have signed the treaty. It has been ratified by 124 countries, including 33 in Africa, 20 in the Asia-Pacific region, 18 in Eastern Europe, 28 in Latin America and the Caribbean, and 25 in Western Europe and other areas.
The ICC has already issued six arrest warrants for Russian aggression, particularly for Russian President Vladimir Putin, M. Lvova-Belova, Commissioner for Children's Rights in the Administration of the President of the Russian Federation, former Minister of Defense of the Russian Federation Sergei Shoigu, Chief of the General Staff of the Russian Federation Valery Gerasimov, and other Russian generals. In theory, all member countries of the International Criminal Court are now formally legally obliged to detain suspects and bring them to trial.
Overall, V. Putin's visit to Mongolia creates an unpleasant precedent (especially for Ukraine) when it is possible to ignore the ICC decision. At the same time, it should be understood that the ICC decisions have been repeatedly ignored even by the countries participating in the agreement.
Let us recall that Russia does not recognize the ISS warrants and is not a party to the Rome Statute, just like China, India, the United States, Israel, and other large countries.
Ruslan Bortnik, Oksana Krasovskaya, Andrey Timchenko
for the Ukrainian Institute of Politics
