KYIV BLOG: Scenarios for an end to the standoff in Ukraine

By bne IntelliNews December 6, 2013

bne -

The situation in Kyiv has reached a standoff. The opposition tried to force through a no-confidence vote in the government and that didn't work. Ukrainian President Viktor Yanukovych was in China the last two days to get some bailout money, but that didn't work either.

Despite the widely held assumption that Russia will come to Ukraine's aid with gas price cuts and billion-dollar loans, it has not publicly offered anything. Yanukovych is due in Moscow this week, but it seems increasingly likely he will leave empty handed. At the same time, having rejected the EU deal, Yanukovych cannot now sign off on a deal to join the Russian-led Customs Union without inflaming the situation at home.

The opposition lost the initiative to the government with the failure of the confidence vote, but it is hard to see what the government can do with its current advantage. So what happens now? One of the big differences between the current situation and the Orange Revolution is that in 2004 there was a disputed election, and Ukraine's Constitutional Court broke the deadlock by coming down on the side of Viktor Yushchenko, proclaiming him president and making it impossible for Yanukovych to ignore.

This time round, although the opposition can call for the government's resignation until it's blue in the face, there is no legal impetus for the government to resign. In theory, Yanukovych can simply ignore the protests until the next scheduled election in 2015. However, there are several potential scenarios that could force the government to go in the meantime.

Economic crisis

The other big difference between now and nine years ago is that the economy is now on the verge of collapse. This is the opposition's best chance to replace the government before 2015. If they continue to block the work of the government, the economy could go into meltdown, and it's already showing signs of severe stress. Devaluation and bank runs are looming. The sale of dollars has soared. At some point the government will get desperate and could use an economic implosion as an excuse to forcibly clear the streets. At the same time, this is an unattractive option for the West, as the opposition could force its way into government but the country will be flat on its back and everyone will suffer.

Party of Regions splinters

Several deputies from the ruling Party of Regions have already quit. If more can be persuaded to withdraw their support, then there is a chance of ousting the government with another no-confidence vote. Despite the failure of the Orange Revolution to improve Ukrainian's lives much, its one lasting legacy is that elections are more-or-less fair and Yanukovych only controls a narrow majority in the Rada. The opposition only just failed to pass its no-confidence vote, scoring 186 of the 226 votes needed. Moreover, Regions only rules with the help of the Communist factions, offering another potential opportunity to drive a wedge into the government's parliamentary support.

Police switch sides

So far the police, and especially the hated Berkut special forces, have remained loyal to the president. But it is possible they could balk at orders to increase the level of violence. There have been reports of army units and tanks being brought up to the capital. At the same time, protestors are reported to have blocked the exit to the Berkut's main base outside the capital. If Berkut continue to be pilloried by the rest of society, they may be persuaded to at least step aside. In 2004 the police didn't play a large role; this time round the protestors have been allowed to capture the centre of Kyiv, which is now barricaded, as well as several municipal buildings. The security operations have been limited to protecting certain key buildings such as the president's office. However, it is not certain they will follow orders to significantly increase the level of force needed to recapture the capital.

Oligarchs abandon Yanukovych

Another of Yanukovych's weaknesses is his reliance on the support of the country's oligarchs, which has left him with a narrow circle of very powerful businessmen as his core supporters. Those such as Dmitri Firtash and Rinat Akhmetov have profited greatly from their membership of Yanukovych's "family". Their economic concerns will be hurt in an economic collapse. They also face the prospect of investigations concerning corruption, renationalisation of their assets and jail should the government change. At the same time, the EU has threatened some of these oligarchs with sanctions, similar to those imposed on Belarusian officials. That would mean their assets and property outside Ukraine could be seized and they would be banned from traveling to the bloc. Over the last few years Yanukovych has helped these oligarchs take control of much of the media, which could be turned on him as a powerful weapon.

At the end of the day, unless one of these groups switches sides, the prospect is for a long drawn-out battle. The opposition is in control of several buildings and so can dig in for the winter. The situation would then mirror the anti-corruption protests in Bulgaria, which have been going on for nearly six months. However, unless there is a successful no-confidence vote, the only other legitimate way of expelling Yanukovych and his cronies is to wait for the next elections in 2015.

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