Ukraine PM resigns paving way to Groysman-headed cabinet

Ukraine PM resigns paving way to Groysman-headed cabinet
Arseniy Yatsenyuk to step down in orchestrated reshuffle.
By bne IntelliNews April 11, 2016

Arseniy Yatsenyuk said he will step down as Ukraine's prime minister because of broad failure by the political establishment to bring "real change", and will submit his resignation to parliament on April 12 for approval.

"Having done everything to ensure stability and continuity of our course, I declare my decision to transfer the obligations and responsibilities of the head of the government," 41-year-old Yatsenyuk said in a televised statement on April 10, having led the government for just over two years.

The  move follows weeks of mounting tensions over Ukraine's faltering reform course and reluctance of the oligarchs to step back from politics, and potentially clears the way for the appointment of parliamentary speaker Volodymyr Groysman to head the cabinet.

Earlier, the factions of Yatsenyuk and President Petro Poroshenko in the Verkhovna Rada legislature backed Groysman to head a new government, and unsuccessfully tried to secure the support of other factions. Finally, Poroshenko and Yatsenyuk moved to create a new parliamentary coalition from their own factions (as of late March, the two factions had 220 votes between them), recruiting a handful of extra non-aligned lawmakers to make up a 226-seat majority in the 450-seat Rada.

Poroshenko Bloc lawmaker Vadym Denysenko said in an interview with Espresso.TV after Yatsenyuk's announcement that he is "99.9% sure" that Groysman, an ally of the president, will become the new premier.

According to Yatsenyuk, his decision to resign was predicated by an artifically created political crisis. "The desire to change one person blinded politicians and paralysed their political will for real change. The process of changing the government turned into a mindless running in place spot. The authors of the crisis became hostages of these circumstances and hold all of us hostage - the government, society, and the state," the premier underlined in his statement.

The People's Front, headed by Yatsenyuk, remains in the ruling coalition because "it is the only way to defend the state", he added.

"Broader goals"

Yatsenyuk added that he now has "broader goals" than having authority at the head of the government. "New electoral law. Constitutional reform. Judicial reform. Coalition control over the direction of the new government. International support of Ukraine . Ukraine's membership in the European Union and Nato. This is only a part of my programme," the premier stated, hinting at the start of a new public political career.

According to previous media reports, Yatsenyuk was ready to resign with the pre-condition that Interior Minister Arsen Avakov and Justice Minister Pavel Petrenko will remain in their posts. Oleksandr Turchynov, Yatsenyuk's associate and former head of the National Security Council and Ukraine's interim president before Poroshenko, should be appointed instead of Groysman as Rada speaker.

Despite the fact that Yatsenyuk and his party lost almost all their popularity, the politician said he is proud of the results of his cabinet. "We accomplished almost the impossible. We defended our state. We created a new army and police," Yatsenyuk said. "We ensured Ukraine ’s energy independence from Russia ... We shed the nomenclature inequality. We saved the economy from default." Ratings, meanwhile, "are a temporary phenomena", he stressed.

Poroshenko team strengthened

"I agree that the country can no longer put up with the absence of the authorities. That is why I expect the parliament to bring good news the next week," Poroshenko said in a interview with Ukrainian TV channels on April 10, adding that he expects a newly-established coalition to propose 38-year-old Groysman, former mayor of Ukrainian city of Vinnytsia, for prime minister.

Previously, political experts in Kyiv noted that Ukraine's Western backers will be unlikely to support the choice of this member of Poroshenko's team in the interests of keeping a balance of power where no one political camp dominates key positions.

However, the prospect of having to hold snap parliamentary elections to breake the impasse has consistently played into Poroshenko's hands. "I do not have another parliament. Another parliament will not be better," the president said. "In this situation, we must ensure that the parliament fulfills its promises made during the signature of the coalition agreement and finishes the process of reforms."

Poroshenko added that he also expects the parliament to adopt the programme of a new government, which should include a list of draft laws on cooperation with the country's main donor, the International Monetary Fund (IMF). The Fund has already witheld $3.3bn in credits until stable government is re-established, while other large foreign credits are tied to the IMF's funding resuming.

Specifically, the US administration has also demanded the creation of a reform-oriented government before international finance assistance is resumed.

"[It's] good if Ukraine has a new government with a majority - but let's look at the shape of that and its programme. That's going to be key to getting IMF lending back on track," Timothy Ash at Nomura International wrote in a research note on April 10.