Ukraine Update 3/29: The Groisman Cometh…


Written by Brian Mefford

The Groisman Cometh…it’s been a little more than 40 days since Yatseniuk’s government survived a no-confidence vote. Since that time the government has been actively searching for a replacement for the embattled Premier, and alternating between Finance Minister Natalie Jaresko and Speaker Volodymyr Groisman. Now it appears that Volodymyr Groisman will secure enough votes to be elected Prime Minister by Parliament. Unlike Jesus’ 40 days in the desert wilderness though, Ukraine is not likely to emerge ready to make radical changes to society. In fact, the status quo of cosmetic change, Western rhetoric, and business as usual are likely to prevail.

Oligarchs and Ukraine’s elites didn’t want Jaresko to take away their use of state enterprises as personal cash machines

For Jaresko, her insistence on being a Prime Minister with real powers – and not in name only – appeared to have sealed her fate. The Ukrainian elites feared that Jaresko would eliminate their use of the state budget as a personal ATM machine. Their fears are probably right. Thus, President Poroshenko orchestrated his political protégé from his hometown of Vinnytsia, Volodymyr Groisman, into the post. In doing so, he ousted Yatseniuk, fended off Jaresko, and managed to consolidate power. Tactically, Poroshenko did everything right. However now he is in complete command of the government and solely responsible for its successes or failures.

However, Volodymyr Groisman is no Serhiy Arbuzov (who was Yanukovych’s last Acting Prime Minister before fleeing the country). The 38 year old’s record of achievement speaks for itself as the current Speaker of Parliament; he previously served two terms as Mayor of Vinnytsia, and was Vice Premier for Regional Policy. His time as Mayor of Vinnytsia was successful by all accounts, and during his time as Vice Premier, Groisman authored the current decentralization legislation now under consideration by Parliament. If confirmed as Prime Minister, he would be Ukraine’s second Jewish Premier, with Donetsk’s Yukhym Zviahilskyi (currently Parliament’s oldest MP at age 79) who served from 1993-1994 being the first. Groisman is clearly competent and effective. Had he become Prime Minister under Yanukovych, the public would have been delighted. However after Euromaidan, the bar has been moved higher. Consequently the stakes are also much higher for the country. Volodymyr Groisman may yet prove to be a great Prime Minister for Ukraine. Ukraine needs it, but no one is yet betting on it. There is however at least one clear benefit, and that is that snap Parliamentary elections will be delayed at least until next year. Ukraine’s leaders need to govern and stop campaigning, and the appointment of Groisman will help this process.

In addition to the vote on Groisman as Premier this week, there was one other vote that must take place before President Poroshenko can fly to Washington on Wednesday. That is the selection of a new Prosecutor General. US Vice President Joe Biden was clear when he told the Poroshenko Administration, «do not come to Washington without a new Prime Minister and Prosecutor General, and expect to have a meeting with me». While incumbent Prosecutor Viktor Shokin supposedly resigned last month, he has remained on the job, and even announced last week that his office does not plan to cooperate with the new Anti-Corruption Bureau. However on Tuesday morning, Parliament finally dismissed Shokin this morning with 289 votes in favor of the motion.

More will be clear soon as negotiations are ongoing among the Parliamentary factions. At the moment the Poroshenko Bloc, People’s Front, and Batkivshchyna are set to create the new Parliamentary majority which would consist of at least 235 MP’s. Samopomich and the Radical Party are apparently going into opposition. Here are the candidates whose names are being considered for key posts:

First Deputy Prime Minister: Vitaliy Kovalchuk. Kovalchuk will get a long coveted post in the Cabinet of Ministers. He nearly became First Deputy Premier last summer, but the move was scuttled at the last minute. Kovalchuk was instrumental in the rise of Vitaliy Klitchko, although he abandoned the Mayor after the election of Poroshenko as President.

Vice Premier Minister & Minister of Economy: Borys Lozhkin. Poroshenko’s Chief of Staff is expected to make his long awaited move to the Cabinet of Ministers. This will open up his position as Chief of Staff and SBU Chief Vasyl Hrytsak and the Managing Director of the Investment Committee (ICU), Makar Paseniuk, are said to be the top choices to replace Lozkhin (age 44). However there is also a possibility that finance guru, Oleksandr Shlapak (age 56), may come out of semi-retirement one more time to take the post. This would happen in the event that Poroshenko gets too much push back about controlling too many government posts with loyalists.

Vice Premier for Humanitarian Policy: Pavel Rozenko. The low key Rozenko (age 45) is being promoted from Minister of Social Policy to a Vice Premier’s post. Rozenko served as First Deputy Minister of Social Policy in Tymoshenko’s government from 2008 to 2010 and was elected to Parliament in 2012 from Klitchko’s UDAR party.

Vice Premier for Euro integration: Ivanna Klympush-Tsyntsadze. Klympush-Tsyntsadze (age 43) is the First Deputy Head of the Foreign Affairs Committee in Parliament. This newly created Vice Premier’s post will presumably work to help Ukraine accelerate its’ European integration and serve as a cheerleader for Ukraine in Brussels, Berlin and Strasbourg.

Vice Premier for Regional Development: Gennadiy Zubko. Zubko (age 48) is one of the few current ministers will is expected to keep his post. Given the planned decentralization later this year, Zubko has been carefully executing Groisman’s plans at the ministry to ensure a smooth transition.

Minister of Finance: Ivan Miklos. Slovakia’s former Finance Minister is well regarded internationally and is the Poroshenko administration’s answer to «how to replace Jaresko». However he is not the first choice. After declining the offer to become Prime Minister, Lech Balcerowicz, the former Polish Finance Minister and author of the «shock therapy» reforms in Poland in the early 1990’s, was approached again about the possibility of becoming Finance Minister. However for Balcerowicz (age 69) and now Miklos (age 55), the issue of giving up their citizenships to become Ukrainian citizens is difficult. Both men are accomplished and respected individuals in their home countries and despite their support for Ukraine, denouncing one’s native passport is no easy decision. If Miklos ultimately declines the offer, then look for Oleksandr Shlapak to possibly return to the post of Finance Minister. Shlapak is competent, smart, and well experienced. He held the same post in the first post-Euromaidan government. The problem for the Poroshenko administration though, is that Shlapak is not the international star that Jaresko, Miklos and Balcerowicz are. Thus, despite his skills, the re-appointment of Oleksandr Shlapak would largely be viewed as a disappointment by both domestic and international audiences.

Minister of Infrastructure: to be determined but apparently it will be someone from People’s Front.

Minister of Social Politics: Andriy Reva. Reva is the Deputy Mayor for Social Policy in Vinnytsia. Reva’s move to the capital will further strengthen the President’s control of the Cabinet of Ministers.

Minister of Energy: Incumbent Minister Volodymyr Demchyshyn (age 41) may yet hold on to his post. With his main critic, Arseniy, now weakened, Demchyshyn has a chance to remain. Alternate candidates include Ihor Nasalyk (age 53) who has a business in the energy sector in Ivano Frankivsk and the current First Deputy Minister of Economy, Yuliya Kovaliv. Kovaliv joined her boss, Aivaras Abromavicius in resigning last month in protest over corruption in the government. Another Deputy Minister of Economy, Yuliya Kuznetsova, has also been mentioned for the post.

Minister of Interior: Arsen Avakov. Despite the growing criticism of the Interior Minister, it is believed that one of Yatseniuk’s conditions to step aside quietly was that Avakov (age 52) remains in his post (the other was no early elections). At one point it looked as is Vitaliy Yarema (also age 52), the former Head of the Kyiv Police and Prosecutor General might return to politics to take the job, but Avakov has apparently managed to maintain his job.

Minister of Justice: Pavlo Petrenko. Another Yatseniuk loyalist is likely to keep his job. Petrenko, age 36, is trusted by Yatseniuk and plays an important behind-the-scenes role within the faction.

Minister of Information: Yuri Stets. Perhaps as surprising as some of the choices for ministerial positions, is the fact that the Cabinet of Ministers plans to keep the poorly conceived Information of Ministry. Despite calls to close the ministry by journalists and the international community, the ministry will apparently continue operating. This can only be explained by the 40 year old Stets’ close friendship with President Poroshenko.

Minister of Culture: Yevhen Nyshchuk. Nyshchuk (age 43) became well known as the «master of ceremonies» during Euromaidan and was catapulted into the Minister of Culture post in the first Euromaidan government. He now appears poised for a return to the post.

Minister of Health: Dmytro Shymkiv. Another of Poroshenko’s Chiefs of Staff may move to the Cabinet of Ministers. Shymkiv (age 40), apparently isn’t eager to take the post since he doesn’t have a medical background. However the job is administrative in nature and Shymkiv’s experience as the CEO of Microsoft in Ukraine may be helpful in trying to reform the horribly corrupt ministry. Deputy Poroshenko Faction Head Oleksiy Honcharenko (age 35) has also been mentioned for the post. Honcharenko has a nursing background and is close to the Poroshenko family.

Minister of Education: Liliya Hrynevych. Hrynevych (age 50) is the current Head of the Parliamentary Committee on Education and Science and is with the People’s Front. She is well regarded in the educational community. However it is not clear yet if she has agreed and many still support the incumbent minister Serhiy Kvit.

Minister of Ecology: To be determined but it appears the post has been offer to Motherland.

Minister to the Cabinet of Ministers: Volodymyr Slishynskiy. Slishynskiy is currently the First Deputy Head of the Administration of Parliament and will now make the switch to the Cabinet of Ministers. Prior to his current post, Slishynskiy was Deputy Mayor of Vinnytsia for Legal Issues. Thus, the Poroshenko-Groisman team will clearly be in charge of the Cabinet of Ministers.

Head of the State Fiscal Service: Nina Yuzhanina. Yuzhanina (age 51) is currently the Head of the Parliamentary Committee on Taxes and Customs. Yuzhanina, a Poroshenko faction member, was promoting «liberal tax reform» late last year in direct conflict with the IMF favored budget, which was ultimately approved and written by Finance Minister Jaresko.

Minister of the Autonomous Republic of Crimea: Taras Kutoviy. Kutoviy (age 39) is currently one of the Deputy Heads of the Poroshenko Faction in Parliament. Kutoviy was elected from District #151 in Poltava (Lohvytsia, winning 63% to 13% over his nearest rival) and serves as the Chairman of the Parliamentary Committee on Agrarian and Land Issues. He was first elected in 2012 with UDAR from the same district.

National Bank Governor: Valeria Gontareva is said to be ready to resign if Jaresko and Abromavicius leave the government. Now that this is a distinct likelihood, it will be interesting to see if she follows through with this action. Gontareva’s draconian currency measures stabilized the hryvnia in 2014 and her departure combined with that of Jaresko’s and Abromavicius’ is likely to send the currency falling against the dollar.

Speaker of Parliament: Andriy Parubiy. Parubiy (age 45) is a lawyer and three term Member of Parliament from the People’s Front. He served as Chairman of the National Security and Defense Council for a two month period in 2014 at the height of the anti-terrorism operation in the Donbas. Parubiy is one of the few ideologues in Parliament with a center-right orientation.

Vice Speaker of Parliament: Iryna Herashchenko. With Parubiy set to give up his Deputy Speaker’s post to become Speaker, Iryna Herashchenko appears ready to fill the position. Herashchenko (age 44) was President Yushchenko’s longtime Press Secretary and has led many humanitarian efforts to assist the Donbas over the last two years. She is serving her second term in Parliament with the Poroshenko Bloc.

Prosecutor General: Yuri Lutsenko or Anatolyi Matios. Lutsenko is a close friend of Poroshenko’s and Head of the Poroshenko Faction in Parliament. Matios is the Chief Military Prosecutor and Deputy Prosecutor General. Both men are under consideration for this key post. However Lutsenko’s statement yesterday that an «outsider» should take the post is seen as both an indication that he is no longer in the running for the job as well as a possible allusion to Mikheil Saakashvili. Saakashvili has long wanted a return to Kyiv in a prime post and the Prosecutor’s job would give him such a position. In the meantime, in his last act as the Prosecutor General, Viktor Shokin fired Georgian Deputy Prosecutor General David Sakvarelidze and eliminated his position Tuesday morning to prevent him from becoming Acting Prosecutor General in his absence.

The firing of Sakvarelidze follows a petition from eight MP’s from the Odesa region (including independent MP Serhiy Kivalov, Renaissance faction MP’s Vitaliy Barvinenko, Vasyl Huliaiev, and Oleksandr Pressman, Pavlo Ungarian and Yevhen Deidey from People’s Front, but also Dmytro Holubov and Oleksandr Urbanskyi from the Poroshenko Bloc). They point out that Sakvarelidze has never taken a Ukrainian passport, and lacks the requirements to serve in the post. More strategically though, they note that Sakvarelidze «holds the office solely in the interests of…Mikheil Saakashvili». In effect, by having eight Odesa MP’s from different factions (including that of the President) attack Sakvarelidze, the open war against Saakashvili and his Georgian Team has begun. It remains to be seen if the letter from the eight MP’s and subsequent sacking of Sakvarelidze, are pre-emptive strikes against Saakashvili becoming Prosecutor though.

The Krivyi Rih Mayoral Election was a political catastrophe for Samopomich that could have been avoided

Krivyi Rih Catastrophe: The votes are still being tallied for the official count but the results of Sunday’s repeat Mayoral Election in Krivyi Rih show incumbent Yuri Vilkul demolishing all opponents with 74% of the vote. Samopomich’s candidate had forced a runoff with Vilkul last autumn, but in a bizarre decision the party bosses changed candidates for the March election. The new Samopomich candidate, MP and well-known Donbas Battalion Commander, Semen Semenchenko, received an embarrassing 11% of the vote. The repeat election was scheduled by Parliament following irregularities during the November 29th runoff between incumbent Yuri Vilkul of the Opposition Bloc and Samopomich’s Yuri Milobog. Vilkul defeated Milobog by a mere 700 votes (out of 188,000 cast) due to overwhelming support from special closed voting stations (hospitals). Vilkul is the father of Opposition Bloc Deputy Faction Head Oleksandr Vilkul. While Yuri Vilkul ran as an independent this time, he clearly benefited from the Opposition Bloc party resources which distributed the usual lavish «gifts» to voters throughout the city prior to Election Day. Nonetheless, the blame for the loss falls squarely on Samopomich’s party leadership. The substitution of a local winning candidate with an imported MP living under an alias smacks of political cronyism and an outright lack of political judgment. Samopomich gave the voters hope that they could be an effective tool for reform in the 2014 elections. Now however the party is looking increasingly sophomoric and clever by half. If Samopomich wants to salvage their political future, they need to institute democratic internal party mechanisms (quit expelling faction members) and hire political professionals who can read public opinion surveys). Meanwhile, the citizens of Krivyi Rih will suffer a political catastrophe because of the foolishness of the Samopomich party leadership.

Independent thoughts and dissent are not welcome in the Ukrainian Parliament due to Law #3700 and selective enforcement of Article 81 of the Constitution

Conform or Be Cast Out: Following passage of the infamous Law #3700 on February 16th, the Poroshenko Bloc faction removed 13 persons from their 2014 Parliamentary proportional list. Law #3700 restricts free speech and undermines the will of the Ukrainian voters, as it allows the expulsion of deputy candidates from the party lists on the proportional ballot. No longer are the voters the decision makers on who is elected from the party lists. Instead political party bosses have the unilateral and unchecked power to remove candidates whom they don’t like. The voters may elect a candidate in a free and fair election, but if that candidate doesn’t obey every demand of the party bosses, he/she can be removed and replaced with a more pliant candidate down the list. Thus, the voters’ will becomes a mere suggestion, rather than sovereign choice of the electorate.

The prime target of Law #3700 was Andriy Bohdan, a lawyer who now represents Kolomoyskyi ally Gennadiy Korban, but was a Poroshenko ally in the autumn of 2014. Bohdan was #74 on the Poroshenko Bloc list to Parliament, which in effect meant he was the next candidate to become a Member of Parliament. By removing Bohdan from the list, he will be replaced by #75 Oleksandr Bryhynets who is a former MP. While Bryhynets is a fine individual and patriotic Ukrainian, the issue is whether the Poroshenko Bloc (and other factions) should be able to purge party list members simply because that individual no longer agrees with the party leaders on every issue. Do the Ukrainian people grant the parliamentary mandate or do the party bosses? Unfortunately in Ukraine, the Communist era «imperative mandate» is still in effect. Imperative mandates give the party bosses, and not the people the sovereign say over who is an elected official. At a time when Ukraine’s government talks about going to Brussels, they now appear on a political path to Beijing. After all, the only countries that enforce imperative mandates today are China, Cuba, North Korea and Vietnam.

However if Law #3700 was not bad enough, the Poroshenko faction voted to expel two faction members this week using Article 81, Paragraph 6 of the Constitution. This Article outlines the ways a Member of Parliament can have his or her powers removed, and a confusing Paragraph 6 includes having never entered the faction, and/or voluntarily exiting thereof – as one of the trigger mechanisms (along with death, resignation, insanity, etc.). It should be noted however that not even Yanukovych, in the darkest days of his regime, ever attempted to interpret Article 81 in such a manner – let alone enforce it. It is one thing to remove candidates from the party list who have not yet served as Members of Parliament. It is entirely another to remove a sitting MP simply because he left the faction. The MPs «cast out» are longtime lawmaker Mykola Tomenko and the youngest MP, Egor Firsov (age 27). Tomenko has made a career of speaking his mind and his disagreement with the budget in December led to his departure from the faction. Firsov quit the faction last month citing corruption by Deputy Faction Head Ihor Kononenko. By voting to expel these two members and replace them with more agreeable individuals, it will lead to other expulsions as well as have a chilling effect on dissension in Parliament.

Is Ukraine’s government becoming a «chocolate monarchy»?

Tomenko, in his classic style, quipped that a «chocolate monarchy» was been formed in Ukraine. At a time when the Poroshenko administration should be cultivating allies to find 300 votes in favor of decentralization and judicial reform, they are actively seeking to make enemies. There is a bunker mentality now on Bankova Street and that bodes poorly for the future of the country and this President.

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