Monitoring of political events in Ukraine
1. Internal policy 1.1. Central authorities President The President’s branch of government was in the spotlight in the past two weeks. As a result, Petro Poroshenko retired from conflict with Ihor Kolomoyskyi as a stronger player, tightened control over procuracy’s structures and was criticized by the Venice Commission for the delay with the constitutional reform. During the period of March 19-26 the Head of the Dnipropetrovsk Regional Administration Ihor Kolomoiskyi was involved in a range of scandals. At first Poroshenko tried to avoid publicity and did not want to take critical decisions, but Kolomoyskyi’s behavior made the President to act decisively. First of all, the Verkhovna Rada of Ukraine (VRU) adopted the law which deprived Kolomoyskyi of control over the largest companies of Ukraine - Ukrnafta and Ukrtransgaz. Ihor Kononenko, Deputy Head of the Petro Poroshenko Bloc (PPB) ruling faction ran an operation on voting and management change from PrivatGroup to governmental officials devoted to Poroshenko. In response Kolomoyskyi used the activists of Dnipro-1 battalion for the raids of state companies’ offices and for protection of his interests. The Security Service of Ukraine (SSU), the Ministry of Internal Affairs of Ukraine (MIA), and then an ambassador and United States Department of State were engaged in solution of the conflict. As a result, the governor resigned and the new Head of the Dnipropetrovsk Regional Administration was appointed among those, close to PrivatGroup and United Media Holding (UMH). Kolomoyskyi’s inner circle appeared at the heart of a variety of criminal cases. One of them is connected with the murder of the SSU officer and Andrii Denisenko’s deputy assistant, and the attempts of some deputies to hush up a scandal. Later Andrii Denisenko admitted that the SSU officer was shot in Volnovakha by one of the volunteers from the Sich organization Denis Gordeev. Gordeev had fought in the Volunteered Ukrainian Corps (VUC) Right Sector and the Dnipro Battalion. For some time Kolomoyskyi’s advisors and people’s deputies blackmailed the President with a possibility of People’s Veche in Dnipropetrovsk. Later the position was changed for more loyal one for Kyiv. After Kolomoyskyi was fired, Poroshenko a little bit strengthened his influence on the governors, took off the leader of opposition among the governors, lowered the Kolomoyskyi’s influence on PPB faction. The main point is concerning the people’s deputy and Kolomoyskyi’s advisor Filatov – if he will still run the preparation for the Large Privatization in Parliament.
The cleaning of the General Procurator’s Office and the Procurator’s Office of
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Kyiv has started: It felt under suspicion that law enforcement officers were pressed during the investigation of grave violations of laws by the son of Deputy General Prosecutor. According to our sources, with the assistance of Vitalii Baganets, approximately hundred of gambling venues and underground casinos, in particular, so called chain BOSS illegally function on the territory of Kyiv. Furthermore, the Kyiv Prosecutor Sergii Yuldashev was dismissed from his post according to the law of Ukraine "On the cleansing of power (on lustration) ". Formally, it is because he had held an office of deputy prosecutor of Luhansk region in 2013. But what is more, General Prosecutor’s Office transferred the proceedings relating to the prosecutor Sergii Yuldashev to Zhytomyr Regional Prosecutor’s Office on corruption charges. Each fired prosecutor is replaced by people received approval in the Presidential Administration. If Poroshenko’s influence on the judicial branch remains limited, during the last two weeks it has considerably strengthened. The Venice Commission is concerned that the constitutional reform proceeds too slowly, while the amendments to the Constitution in the part of decentralization must come into force by the end of this year. The President of the Venice Commission Gianni Buquicchio made a statement about it at the Congress of Local and Regional Authorities of the Council of Europe. He stressed that the Constitutional Commission which must develop the amendments to the basic law had not started its work. Parliament The coalition has tough times. The number of conflicts inside reached a very high level. On March 20 the head of the PPB Yurii Lutsenko announced about the stuff reshuffling in the Cabinet of Ministers. The faction counsil of PPB removed 4 people’s deputies close to Kolomoyskyi from the faction. On Monday Vitalii Kuprii, Andrii Denisenko, Aleksandr Dubinin and Valentin Didych held a press-conference where Denisenko confessed that his fighter shot the SSU officer in Volnovakha during the confrontation. The faction counsil considered that the deputies meant to shift the blame on the officer deceased in Volnovakha with such a statement, and thus, discredited a faction. Besides, BBP addressed the General Procurator’s Office with a request to carry out an omnibus inquiry of the circumstances of state enterprises raids in Kyiv, death of the officer in Volnovakha and other crimes connected with Kolomoyskyi in the shortest possible time. In spite of the increasing tension in coalition, the majority of the parliament managed to fulfill one of the basic promises – to start the creation of public television. On March 19 the VRU voted for the law “On creation of public service broadcasting”.
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According to the enacted law The broadcasting will be carried not less than on two nationwide channels (socio-political and cultural-educational), on the regional channels and not less than on three nationwide radio channels (socio-political, cultural-educational, for youth); The Rada did not permit the local authorities to have “regional public service broadcasting”. For the last few days the political preferences of Ukrainians have become known. According to the Razumkov Centre public opinion poll (conducted on March 6-12):
Clear the 5% barrier at the parliamentary elections if they are conducted in the nearest Sunday could there parties – Petro Poroshenko Bloc, Samopomich and Opposition Block. For PPB there would be 14,1% votes, for Samopomich – 9,3%, for Opposition Bloc – 6,8 %. Narodnii front of Arsenii Yatseniuk – 4,6%, Radical Party of Oleh Liashko – 4,5%, Batkivshchina – 4,4%. The communists would have 3,1% civil Position of Analolii Grytsenko – 2,7%, Strong Ukraine of Serhii Tehipko – 2%, Svoboda – 1,8%. 4,6% would vote for other political parties, 2,3% would spoil the bulletins, 22,1% would not participate in the elections, 17,7% - undecided.
According to the Kyiv International Institute of Sociology (conducted on the same days), electoral sympathies are the following: Clear the 5% barrier could PPB (16,1%), Samopomich (10,3%) . Batkivshchina (7%), Opposition Bloc (6,2%) and Radical Party of Oleh Liashko (5%). Narodnii Front takes only 4%. The current President Petro Poroshenko remains the leader of the electoral sympathies in Ukraine. 35,2% of Ukrainians who have an intention to participate in the elections are ready to give their votes for Poroshenko (20% of the general quantity of pollees). The people’s deputy Yulia Tymoshenko takes the second place with 11,6% (6,6%)
Andrii Sadovyi, the mayor of Lviv takes the third place – 11,4% (6,5%) citizens wish him to be the head of the state. Others support the leader of the Radical Party Oleh Liashko (7,7% of general quantity of the conventional votes and 4,4% of the all the pollees), the leader of the Civic Position Party Anatolii Grytsenko (7,1% and 4,1% correspondingly), the current Prime Minister Arsenii Yatseniuk (5,2% and 3%) and the leader of the Right Sector Dmytro Yarosh (5% and 2,8%).
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Cabinet of Ministers The Prime Minister and the Cabinet of Ministers of Ukraine appeared in the focus of corruption scandals which greatly weakened the authorities of both. From the one hand Arsenii Yarseniuk has made a series of anti-corruption actions during the last two weeks. The Cabinet of Ministers of Ukraine attempts to fight against corruption with the help of creation of new authorities and changes of the heads of revision structures. On March 18 Arsenii Yatseniuk reported about the development of the National AntiCorruption Agency. The main objective of the Agency is to introduce the electronic form of property declaring by public officials. The decision about the development of the National Agency on lustration under the Cabinet of Ministers of Ukraine has been taken. Such authority will have the main function – control of implementation of the law “On the cleansing of power (on lustration)”. Creation of independent authority for performing lustration in Ukraine is one of the requirements of the Venice Commission. But the mentioned processes went along with the public corruption scandals with the involvement of the Prime Minister. The head of the State Fiscal Service of Ukraine Ihor Bilous and his two deputies were dismisses. It is related to the fact that the General Prosecutor’s Office of Kyiv launched a criminal proceeding upon the possible getting from the State Fiscal Inspection an improper advantage during clearing the goods by the customs at the border. The management was approved by the Prime Minister in November 2014. The Prime Minister dismissed the Head of the State Fiscal Inspection Mykola Gordienko. Gordienko publicly accused Arsenii Yarseniuk of participation in corruption in 2014. In reply Yatseniuk asked General Prosecutor’s Office to check the claims of corruption in the address of the government. Apparently, sustaining a public image the Prime Minister started the arrest practice of the suspected officials live on television. Thus, on March 25 the Head of the State Service for Emergency Situations Serhii Bochkovskii and his first deputy Vasil Stoetskii were arrested during the meeting of Cabinet of Ministers. The Bochkovskii’s arrest was shown live on the Ukrainian channels. It was reported that the official and his deputy were arrested within a framework of the criminal investigation of corruption fact in the State Service for Emergency Situations. The officials were read the case, put handcuffs and taken away from the hall. As a result of public charges, the General Prosecutor’s Office of Ukraine has opened an investigation not against the Prime Minister but due to abuse of powers of the officials. The Prime Minister Yatseniuk stated that he was ready to witness. Also, the Ministry of Internal Affairs has started an investigation with regard to two former ministers, appointed in the previous government quota VO Svoboda – Ihor Shvayka and Andrii Mokhnyk. Arsenii Yatseniuk was the Prime-Minister at that time.
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Judicial branch The chairman of the Higher Administrative Court of Ukraine (HACU) Oleksandr Nechytaylo resigned. On March 27, 2015 the resignation was accepted at the meeting of judges. Oleksandr Nechytaylo was elected as a Head of the Ukrainian Higher Administrative Court on June 16, 2014. The reasons of his resignation are still unknown. The race for coming into office - the key one expecting the mass privatization is going to start. Preparation for the local elections At present, the President and the Prime Minister whose popularity have considerably decreased think about the opportunity to postpone the local elections until the constitutional reform process is not completed. The Council of Europe demands the same. Currently the country’s leadership considers two variants. Either the elections will be held according to the old rules in the framework of the old community (and both PPB and Narodnii Front will not be able to provide their considerable presence in the self-governing authorities), or will be postponed until the amendments to the Constitution are accepted (during this time the sympathies can be changed).
1.2 Economic and politics The banking system of Ukraine is in a difficult situation. The National Bank of Ukraine continuing the procedure of withdrawal insolvent banks from the market,
made a decision to revoke a license of VAB-Bank, Bakhmatiuk’s bank and its liquidation;
started rehabilitation of Delta Bank. There are differences in the positions of the President and the Prime Minister. The President supports the idea of nationalization of Delta Bank. The Prime Minister and the Ministry of Finance are against, not having enough costs for its recovery. The International Ratings Agency Fitch Ratings downgraded long-term foreign currency issuer default ratings of key state banks Ukreximbank and Oshchadbank and their foreign currency debt ratings to CC from CCC. The downgrade reflects Fitch's view that defaults by both banks. According to Fitch, Ukreximbank has two large outstanding eurobonds: USD750m due on April 27, 2015 and USD600m on January 22, 2018. Oschadbank, in its turn, has USD700m eurobonds due on March 10, 2016 and USD500m due on March 20, 2018. At the same time, Fitch Ratings has downgraded DTEK Energy B.V.’s long-term foreign and local currency Issuer Default Ratings (IDR) to 'C' from 'CCC'. It is reported that the rating action was due to the company’s default because of the low level of its liquidity. On March 25, DTEK started the negotiations with creditors about the restructuring the securities. On March 17 the law came into force which requires the reductions of pensions for working pensioners, elimination of payments to workers holding special ranks, and also the changes in preferential retirement plan. However, such steps did not mend the situation in the Pension Fund.
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Last week the Minister of Social Policy Pavlo Rozenko stated that Pension Fund was bankrupt. The Pension Fund lacks 80 billion UAH for payment of pensions in the amount existing today. Pavlo Rozenko noted that due to the joint principal position of the president and the government negotiation group, the key requirement of the IMF regarding balancing the budget of the Pension Fund by raising the retirement age to 65 years was avoided.
1.3 ATO/War in Donbass The war has been lasting for a year in Ukraine. On March 21 the President of Ukraine Petro Poroshenko came out with the analysis of this period. According to him, the first stage of the war is the annexation of Crimea, the second – volunteer phase, when Donbass was lost, but other territories were saved. The third stage of the war is the release of a part of Donbass with the help of the army. President called the current cease-fire promising. For the anniversary of war Kyiv changed its legislative attitude to the territories controlled by separatists: The VRU by 286 votes adopted a resolution on the recognition of individual territories of the Donetsk and Luhansk regions as occupied. The VRU accepted the amendments to the law “On local self-government” in certain areas of Donbass related to local elections. 265 deputies voted for. The law “On local selfgovernment” will come into effect after local self-governing authorities are empowered to. Besides, it is stressed in additional law that the elections must be held due to international standards, with the participation of foreign observers to prevent the intervention of illegal armed formations during the voting process. The project also requires the freedom of the pre-election campaign and the possibility of accessing mass media. Television and radio broadcasting and free distribution of printed media must be recovered on the whole territory of regions. The VRU addressed the UN and the EU with a request to deploy peacekeepers in Ukraine. In reply the leaders of the DPR and LPR Aleksandr Zaharchenko and Ihor Plotnitskii refused from any compromises with the Ukrainian authorities until the amendments to the law about Donbass are not cancelled and the request as for peacekeepers is not called off. After that the negotiations on prisoner exchange were broken off. For the last two weeks the confrontation activity has been low. The major firefights took place near the village Peski, in the direction of Mariupol and in Luhanshchina, near the village Sokolniki. During the cease-fire, Kyiv actively imposes order in the ranks of the Armed Forces of Ukraine, the Ministry of Internal Affairs and other power groups. The main directions were:
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The control of separate volunteer units by governmental authorities. Thus, VUC Right Sector appeared under the pressure to bring its divisions into the Armed Forces of Ukraine or the Ministry of Internal Affairs. And the leader of the Right Sector Dmytro Yarosh was proposed a post in the Ministry of Defense. Some parts of Azov and Dnipro became a part of the Armed Forces of Ukraine. The State Security Service of Ukraine and the National Guard of Ukraine intensified the work with plunderers and weapon sellers on the territories under control of Kyiv. On March 26 during the special-forces raids for cleaning up the ATO zone from illegal weapons and trafficking, 30 offenders in Donetsk and Dnipropertrovsk regions were arrested. Anti-corruption operations at the Ukrainian checkpoints have been started. The State Security Service of Ukraine informed about 7 servicemen involved in the extortions. The prohibition on alcohol sale to the “people wearing uniforms” was enforced in the Donetsk and Luhansk regions. This is due to the incident in Konstantynivka, where drunk servicemen hit a woman with two children. The incident excited a rebellion in Konstantynivka which had to be hard suppressed. At the same time separatists step up the attack. On the authority of the press, Russia keeps supply weapons and military equipment to the terrorists on Donbass. But both sides keep the seace-fire regime.
1.4. Events in the regions 1.4.1. Crimea The reelections of the Head of Crimean Tatar Medzhlis have been held. Ilmi Umerov, the former mayor of Bakchisaray was expected to become the new Head. He is a member of Liberal group and lives in Crimea, which gives him an advantage unlike Chubarov who lives in Ukraine. Besides, Umerov is supported by the major part of Tatar community tired from the conflict with local authorities. Before the elections the SSU publicly warned Umerov about the forthcoming questioning. This is due to his participation in the forbidden meeting in Sevastopol in the beginning of March.
The most powerful group of Medzhlis (“nationalists” where Refat Chubarov and Mustafa Dzhemilev belong to) opposed Umerov and his moderate stand. The third and the weakest group in Medzglis – “Islamists” who supported a candidature of Chubarov. As a result, Refat Chubarov, the people’s deputy of Ukraine and the politician with the ban on entering Russia won the elections again. 24 from 30 members of Medzhlis participated in the elections (some of them via Skype). The position of the first deputy was given to Nariman Dzhelial (politician close to both “nationalists” and “islamists”). Ilmi Umerov has been appointed the sixth deputy of Medzhlis Head. Straight after the elections the SSU made a search in Dzhelial’s apartment.
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1.4.2. Kharkiv After Kernes stated that he was going to come back in politics, criminal cases were reopened against him. Last week the General Procurator’s Office of Ukraine referred to court a bill of indictment in the criminal proceeding on suspicion of the mayor of Kharkiv G. Kernes and his security V. Blynnyk and E. Smytskyi in committing crimes provided by p.2 Art. 146, p.2, Art.127, p.1 Art.129 of the Criminal Code of Ukraine: kidnapping and tortures of activists of Euromaidan in Kharkiv. The Kernes case will be heard in the Higher Specialized Court of Ukraine in Kyiv.
1.4.3. Odessa As the result of conflict with Kolomoyskyi, on March 23 all the protective structures providing law and order in Odessa from May 6, 2014 were removed from the city under control of the State Security Service of Ukraine. Along with that the influence of the governor Palytsia on the political and business processes in the region have considerably weakened. The next day the State Security Service of Ukraine and the National Guard arrested six proRussian activists, including the organizers of the action aimed to destabilize the situation in the city. According to the published immediate information, there was a plan to make anti-Kyiv movies. At the moment the State Security Service of Ukraine declared about the preparation for the second stage of anti-terrorist operation in Odessa. Specialists from other cities strengthen the law enforcement authorities in Odessa. Besides, it became known that the General Procurator’s Office of Ukraine had proceeded the investigating actions towards the people’s deputy Serhii Kivalov. The General Procurator’s Office carries out an inspection of the actions of Kivalov for identification of signs of public calls for changes in the constitutional form of government, violation of foreign territorial supremacy and inviolability of Ukraine, funding the actions aiming to make forcible changes in the constitutional form of government or its overthrow, seizure of the state power, territorial changes or the changes of the state border of Ukraine. At the same time, there was an explosion in the office of Odessa volunteers (Geranevaia Street, 2). No one was hurt.
1.4.4. Zaporizhzhia Zaporizhzhia appeared in the focus of scandals. At first, as the result of a scandal with Kolomoyskyi, newly-appointed governor Reznichenko was transferred to Dnipropetrovsk. The long absence of the governor (almost 7 months) and sudden change of the Head of Zaporizhzhya Regional State Administration (RSA) led to a buildup of tension in the society. On March 26 there was an explosion near the building of RSA and the headquarters of SelfDefense in Zaporizhzhia. No one was hurt, but this was the first act of terrorism in the city. That day regional and local councils of Zaporizhzhia refused from considering the matter about the recognition of the DPR and LPR to be the terrorist organizations.
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2. Foreign policy On March 20 the final Protocol of decisions of European Council was released to public. One of the decisions – sectoral economic sanctions against Russian Federation will be valid till the end of the year. Despite the announcement of considerable number of European leaders as for their intention not to extend the validity of sanctions against Russia, after all political decision about extension the validity of sanctions at least till the end of 2015 was passed. The decision must be adopted by the Council of the European Union. The decision will be executed by national governments, for whom they are permissive. The European Union has officially recognized the existence of the problem of Russian propaganda machine for the first time. Significant efforts and means of European countries will be focused on the fight against this strand of “hybrid war”. This summer a plan for counterpropaganda measures and defense of the European information space will be approved. On March 17, 341 people's deputies voted for appeal to UN and EC to bring peacekeepers to Ukraine. Thereby, the Rada on behalf of Ukraine adopted a Resolution about acceptance of the appeal to the UN Security Council and the Council of the European Union to deploy an international peacekeeping and security mission on the territory of Ukraine ( №2379). Currently the UN has taken cognizance of the appeal. The date of convening the UN Security Council on the subject is still unknown. Berlin considers the Ukrainian appeal to be an essential signal for Europe. Now Berlin is supporting the idea of security mission. Brussels has not given an official reply to the VRU’s appeal yet. Parliament of Germany ratified an association Agreement between Ukraine and ЕС. Currently an association Agreement between Ukraine and ЕС has already ratified by Ireland, Denmark, Hungary, Sweden, Estonia, Slovakia, Bulgaria, Lithuania, Latvia, Malta, Czech Republic, Poland and Rumania. It is expected that all the countries of European Community will ratify it before May 2015. NATO has enhanced its military bases on the east of Europe, but toned down the rhetoric as for Russia. On March 21 NATO Secretary-General Jens Stoltenberg made an announcement about un-co-operation between Russia and the West, but it is not referred to cold war. “We are not at the cold war, because it was a comprehensive ideological war between two military blocs. It does not happen now. But we are not in the state of cooperation which we tried to work it out after the Cold war” – stresses Stoltenberg. According to him, there is no cooperation between Moscow and the West because of the violation of International rules.
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In his reply on March 26, Vladimir Putin accused Western countries of planning the destabilization of situation in Russia in the coming years. According to it, for “inhibition of Russia” the West uses “all the possible resources – from the attempts of political isolation and economic pressure to the widespread information war and tools of the special services”. In his judgment, destabilization may occur during the elections 2018 when he can run in for the fourth presidential terms. Actual articles Ihor Burakovski, The agenda of association. Some thoughts about the key notes. (http:// www.eurointegration.com.ua/rus/experts/2015/03/26/7032282/) Aleksandr Golubov, Dismissal at request. How did Poroshenko manage to win Kolomoyskyi (http:// carnegie.ru/2015/03/27/ru-59511/i4zw) Yulia Mostovaia, Corset for a dream (http://gazeta.zn.ua/internal/korset-dlya-mechty-_.html) Yulia Oliynyk, Between the raiting and Kolomoyskyi (http://tyzhden.ua/Politics/132806)
«After Kolomoyskyi»... (http://www.day.kiev.ua/ru/article/podrobnosti/posle-kolomoyskogo)
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