Hard Choices in Kiev

LONDON, UK -- Despite the recent parliamentary tribulations in Kiev following the vote of no confidence in Yuri Yekhuranov's administration inspired by his predecessor, Yulia Tymoshenko, there are ways in which the reformers could move head - if they see clearly the future of Ukraine's troubled revolution.

Prime Minister Yuri Yekhuranov

The fractiousness that has been the hallmark of relations between the triumphant Orange revolutionaries has allowed Viktor Yanukovych's Party of the Regions back into the electoral frame barely a year after its leader appeared to be politically buried.

Now his group party is leading in the most recent polls with 25 per cent voter support. So Yanukovych appears set fair to head the largest party in parliament, the Rada, following parliamentary elections on 26 March.

Oligarchs

This would not bode well for further reforms. The Donetsk based party is backed by oligarchs, such as the Chief of Staff of the old Kuchma regime, Viktor Medvedchuk, and the ex-President's son-in-law, Viktor Pinchuk.

Rinat Akhmetov, owner of System Capital Management and reportedly Ukraine's richest man, will join the party as a prospective member of the Rada.

Backers such as these will ensure that the line between business and politics remains blurred.

The stable and predictable business environment these oligarchs claim they wish to see restored is most probably the baleful cronyism of the Kuchma era. Meanwhile The Party of the Regions is far closer to Moscow than Yushchenko's beleaguered reformers.

Vladimir Putin will feel he has regained Ukraine after losing to the Orange coalition.

Election

Tymoshenko's Motherland party is at 13.6 per cent in the polls while Yushchenko's Our Ukraine party trails in third place with 11 per cent. These figures are unlikely to change dramatically. That would leave no party with an overall majority capable of forming an administration in March.

On these figures, the Party of the Regions will gain some 175 seats in the Rada while Tymoshenko will receive 95 seats and Our Ukraine 79. Socialists, the ultra left Vitrenko bloc, the Popular Party and the Communists should receive some 25 or so seats apiece should they poll over the 3 per cent threshold to obtain Rada seats.

So coalition games will be the score.

Reconciliation

There is little likelihood of Yanukovych and Tymoshenko joining forces.

Her party would not support such a move. Ideological differences aside, neither leader would be satisfied with anything less than the Prime Minister slot. Their recent unity on the No Confidence vote was a short lived marriage of convenience.

From Tymoshenko's point of view it was a chance to remind Yushchenko that he needs her to push through his policies. For Yanukovych it was a splendid chance to further embarrass Yushchenko ahead of the March elections.

It is unlikely that Our Ukraine would seek an alliance with Yanukovych.

Many of its members would defect to an opposition led by Tymoshenko. Our Ukraine could team up with the Socialists who supported Yushchenko during the Orange Revolution and possibly Rada Speaker Lytvyn's Popular Party.

However, to obtain some form of political legitimacy and muscle Yushchenko's party must seek out reconciliation with Tymoshenko.

One Orange

This is not impossible. Tymoshenko was wounded by her dismissal in September 2005, but will feel honour was satisfied by her dismissal of the Yekhuranov government.

There were solid alliance talks at the end of 2005 - and the parties' positions do not seriously diverge. Both believe broadly in the direction of reforms. Tymoshenko has said she will regard the Party of the Regions as her main opponents. She still regards herself as being on Yushchenko's side.

The sticking point will be whether Yushchenko will show similar political nous. This has not been a feature of his administration so far.

He approached reform as a technocrat, not a politician. He needs advisers with better political instincts to translate his plans into lasting and successful change. So far, he has achieved little, save the squandering of much of the goodwill bred by the Orange Revolution.

Constitutional Power

The dismissal of Tymoshenko in September ended by weakening the President's position - there than clearing of the air he had envisaged.

Tymoshenko had a valid point when she claimed that the recent gas deal with Russia that sparked the no confidence vote would only be valid for six months, and in no way represented a long term solution to this vexed issue.

No one knows better than Tymoshenko, a former energy billionaire, the temptations and potential corruption inherent to the barter capitalism represented by gas agreements with Russia.

Simply, Yushchenko must swallow his pride in March and ensure that his Our Ukraine party works with Motherland under Tymoshenko as Prime Ministership.

His choices are limited, but, if he fails to form such a coalition, there is little chance of a reform government.

Moment of Truth

Should the parties fail to reach agreement in the spring, the country's new constitution holds Damoclean sword for Yushchenko to wield.

If there is no majority within a month of elections then they face disbandment by the President and thus repeat elections and more uncertainty that will be damaging both politically and economically.

Source: Early Warning

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