Ukraine in suspense over Tymoshenko's Nato position

By bne IntelliNews September 8, 2008

Graham Stack in Moscow -

Ukraine's Nato aspirations have moved to the frontline of Russia's showdown with the West, but the biggest unanswered question is what Prime Minister Yulia Tymoshenko's current position is on the country's bid for membership of the organisation.

Joining Nato has been a core part of President Viktor Yushchenko's platform, which Tymoshenko reluctantly signed up to while they were still political allies following the 2005 Orange Revolution. However, after Tymoshenko made a Faustian deal on September 2 with opposition leader and her revolutionary nemesis Viktor Yanukovych, who heads the Regions of Ukraine party, she seems to be shifting her stance and preparing to drop these Nato membership ambitions.

Nato membership is a hot topic following the five-day Russo-Georgian war in August, yet Tymoshenko has pointedly refrained from making any comments on Ukraine's bid recently. During the conflict between Russia and Georgia, the notorious firebrand kept a conspicuously low profile, to the point where her opponents in the Rada started to brand her pro-Russian. She failed to join other US-backed leaders at Georgian President Mikheil Saakashvili's side in the aftermath of the war. While she supported Georgian territorial integrity, she warned against hostility to Russia and against any retaliatory measures against Russia's Black Sea fleet based in the Crimea in Ukraine.

Tymoshenko's shift is so surprising it even prompted Ukraine's security service SBU, acting on information provided by the presidential administration, into investigating her and the government on suspicion of working "against the national interest." The SBU specifically asked the prime minister's office to supply it with information about her negotiations with Russia over gas prices for 2009, amongst other things.

Tymoshenko moved into open opposition to Yushchenko on the first day of the new session of parliament by voting with Regions on a package of laws that will strip the president of many of his powers (including control over the SBU). While it's very early days in the dispute, pundits are speculating that Tymoshenko has abandoned a plan to run for president in the next elections and is instead moving Ukraine towards becoming a parliamentary democracy. She has already said she intends to introduce as-yet unspecified changes to the constitution in the near future.

Yushchenko has responded by accusing her of treason and selling out Ukraine to Russia. The confrontation is scaling up fast. In a letter to the head of the SBU, leaked to a newspaper, presidential administration head Victor Baloha accused Tymoshenko of preparing a coup d'etat in Moscow's interest, and also taking out a contract on Baloha's life. Already nervy investors are getting cold feet: trading was suspended on the stock market, the PFTS, on September 5 after the index plunged 7% and three-quarters of the listed companies posted share price losses.

The main victim in this escalating fight could be Ukraine's Nato bid. And there are two good reasons why Tymoshenko may end her support for membership.

Looking east

Firstly, attempting to join Nato will cost her votes. The most recent poll on the subject, released September 4, found that Ukrainian citizens prefer integration with Russia and other CIS countries to that with European and Euro-Atlantic structures. Just over half the population favours closer ties with Russia and/or the CIS countries, while only 17% want to join the EU, according to the Ukrainian National Academy of Sciences' Sociology Institute. In polls taken earlier this year over 60% of Ukrainians were against joining Nato, whereas they remain much more receptive to the idea of eventually joining the EU.

In the run-up to last year's parliamentary elections, Tymoshenko went out of her way to woo voters in the largely Russophile eastern part of Ukraine and has built up broad support across the country. But if she is to move Ukraine towards a parliamentary democracy, then she needs to take the concerns of ethnic Russians to heart, which means moving closer to Moscow.

Tymoshenko and her eponymous party Bloc Yulia Tymoshenko (BYuT) are still only slightly ahead of former prime minister Yanukovych and his Party of Regions in the polls. Dropping support for joining Nato could win over significant numbers of voters from Regions. To be a powerful long-term prime minister without relying on other parties, she will need a far larger majority in the Rada than she has now.

Secondly, Tymoshenko is entering tough negotiations with Russia over gas imports for 2009. Analysts say the gas price for Ukraine could double after Russia recently agreed to pay Central Asian producers European prices for their oil and gas. With Ukrainian inflation already soaring and a current account deficit looming, this could create significant economic difficulties for Tymoshenko in 2009, as she will get the blame.

For its part, the Kremlin appears in the mood to deal. Russian Prime Minister Vladimir Putin has been travelling in Central Asia to bolster support for Russia and in addition to agreeing to up the price of Central Asian oil and gas, also signed off on new pipeline deals. The Kremlin would certainly be open to softening a price hike in Ukraine's gas bill if Tymoshenko would back Russia in its standoff with the West.

US Vice President Dick Cheney was in Kyiv in early September to show his support for Ukrainian democracy. But that democratic process may end up pushing Ukraine into closer ties with Russia, not the West.

Send comments to The Editor

Ukraine in suspense over Tymoshenko's Nato position

Related Articles

Drum rolls in the great disappearing act of Russia's banks

Jason Corcoran in Moscow - Russian banks are disappearing at the fastest rate ever as the country's deepening recession makes it easier for the central bank to expose money laundering, dodgy lending ... more

Kremlin: No evidence in Olympic doping allegations against Russia

bne IntelliNews - The Kremlin supported by national sports authorities has brushed aside "groundless" allegations of a mass doping scam involving Russian athletes after the World Anti-Doping Agency ... more

PROFILE: Day of reckoning comes for eccentric owner of Russian bank Uralsib

Jason Corcoran in Moscow - Revelations and mysticism may have been the stock-in-trade of Nikolai Tsvetkov’s management style, but ultimately they didn’t help him to hold on to his ... more

Register here to continue reading this article and 2 more for free or 12 months full access inc. Magazine and Weekly Newspaper for just $119/year.

If you have already registered, enter the information below with the same email you used previously and you will be granted immediate access.

IntelliNews Pro subscribers click here

Thank you. Please complete your registration by confirming your email address. A confirmation email has been sent to the email address you provided.

Thank you for purchasing a bne IntelliNews subscription. We look forward to serving you as one of our paid subscribers. An email confirmation will be sent to the email address you have provided.

To continue viewing our content you need to complete the registration process.

Please look for an email that was sent to with the subject line "Confirmation bne IntelliNews access". This email will have instructions on how to complete registration process. Please check in your "Junk" folder in case this communication was misdirected in your email system.

If you have any questions please contact us at

Subscribe to bne IntelliNews website and magazine

Subscribe to bne IntelliNews website and monthly magazine, the leading source of business, economic and financial news and commentary in emerging markets.

Your subscription includes:
  • Full access to the bne content daily news and features on the website
  • Newsletters direct to your mailbox
  • Print and digital subscription to the monthly bne magazine
  • Digital subscription to the weekly bne newspaper

IntelliNews Pro subscribers click here

bne IntelliNews
$119 per year

All prices are in US dollars net of applicable taxes.

If you have any questions please contact us at

Register for free to read bne IntelliNews Magazine. You'll receive a free digital subscription.

If you have already registered, enter the information below with the same email you used previously and you will be granted immediate access.

Thank you. Please complete your registration by confirming your email address. The confirmation email has been sent to the email address you provided.

IntelliNews Pro offers daily news updates delivered to your inbox and in-depth data reports.
Get the emerging markets newswire that financial professionals trust.

"No day starts for my team without IntelliNews Pro" — UBS

Thank-you for requesting an IntelliNews Pro trial. Our team will be in contact with you shortly.