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Poland, Belarus & Ukraine Report: September 16, 2005

16 September 2005, Volume 7, Number 33
EU BROADCASTING PROJECT COMES UNDER FIRE. European Parliament deputies representing mostly new member states on 14 September attacked plans announced by the European Commission to fund independent radio and television broadcasts to Belarus. Deputies complained at a meeting of the European Parliament's Foreign Affairs Committee that the funds were insufficient, the tendering rules discriminate against countries bordering Belarus, and too much emphasis is being put on the use of Russian language in the putative broadcasts.

Many members of the European Parliament (MEPs) were particularly scathing about the commission's perceived preference for Russian over Belarusian as the main language for the planned broadcasts.

Former Lithuanian President Vytatutas Landsbergis was one of a number of MEPs from former communist countries who warned the commission it risks complicity in Russia's longstanding ambitions to "Russify" its neighbors. Landsbergis demanded assurances Belarusian will feature alongside Russian in broadcasts to Belarus.

"I would like to be sure that [the] formula 'Russian and Belarusian' -- at least -- is not to be interpreted as 'Russian or Belarusian,'" Landsbergis said. "Or, in turn, that it is [not interpreted to be] an issue to be decided by Deutsche Welle."

Deutsche Welle last month became the first media company to be awarded a commission contract to broadcast to Belarus. The commission first said broadcasts would use Russian, with the possibility of Belarusian being added at a later, unspecified date (see "RFE/RL Belarus, Ukraine, and Moldova Report," 24 August 2005).

Some Western European MEPs pointed out that more than 60 percent of the population of Belarus considers itself ethnically Russian. Their appeals to pragmatism were drowned by protestations from representatives of smaller, Eastern European member states.

Toomas Hendrik Ilves, an Estonian and a vice chairman of the parliament's Foreign Affairs Committee, noted that indigenous languages, not Russian, had served as the main vehicles for democratic change in Eastern Europe. He also appealed to the national awareness of smaller Western European countries.

"Imagine if in this parliament we said 'Well, all the Slovaks understand Czech, all the Danes understand Swedish, all the Portuguese understand Spanish, and all the Dutch understand German'? What would be the reaction here?" Ilves asked. "We can say, of course, 'All the Belarusians understand Russian,' but what does that mean for the people you are talking to?"

Most speakers also dismissed the 2 million euros ($2.4 million) earmarked by the commission for two years' TV and radio broadcasts as by far insufficient. The commission's tendering rules, requiring applying media organizations to demonstrate an annual turnover of 3 million euros, were described as designed to exclude companies from neighboring Poland and Lithuania.

The strategy also appears to sideline the 500,000 ethnic Belarusians living in Poland and the three Baltic States, who a number of MEPs said would be best-placed to reach out to their compatriots.

Polish MEPs were particularly scathing in their judgments of the commission's performance. They accused the EU's executive of dragging its feet, pointing out Polish parliamentarians had been spearheading demands for action for over a year.

Ilves, a former director of RFE/RL's Estonian Service, also warned that the 2 million-euro budget for television and radio broadcasts stretched over two years would allow for "minuscule" amounts of programming.

A number of MEPs also attacked current EU funding rules that require it to clear assistance with the government of the country targeted. Edward Mcmillan Scott, a leading British conservative MEP, was among those suggesting the EU must overhaul the system to allow it to finance organizations that may be illegitimate in the eyes of regime's such as President Alyaksandr Lukashenka's.

"TACIS [the main EU aid program for the former Soviet Union] must be flanked by an external fund for Belarus that is managed and disbursed by the commission with assistance from a small number of interested member states," McMillan Scott said. "Such a fund needs to operate outside the strict guidelines of the commission. The purpose and mission of the fund would be to offer fast and flexible support to Belarusian democratic forces and NGOs that fall outside the parameters of current EU regulations and often have to operate on an illegal basis inside the country."

A representative of the European Commission, Hugues Mingarelli, present at the debate, offered a defense of its record and assured the MEPs of its continuing commitment to promote reforms in Belarus. However, he did not address the criticism offered by MEPs in any detail beyond saying that it is "a fact that today more people in Belarus speak Russian than Belarusian." (Ahto Lobjakas)

PRESIDENT SACKS GOVERNMENT, OFFERING MORE QUESTIONS THAN ANSWERS. President Viktor Yushchenko on 8 September dismissed the cabinet of Prime Minister Yuliya Tymoshenko and accepted the previous day's resignation of National Security and Defense Council Secretary Petro Poroshenko. A few days earlier, Yushchenko accepted the resignation of his chief of staff, Oleksandr Zinchenko. Thus, three of Yushchenko's closest allies and brothers-in-arms from the November-December 2004 Orange Revolution in Ukraine have found themselves outside the government and are not likely to return to it before the March 2006 parliamentary elections. The Orange Revolution, in accordance with a well-known saying, has started to devour its children.

The dismissal of the Ukrainian government took place amidst allegations of corruption in the president's inner circle, which were publicly voiced by Zinchenko and Tymoshenko's closest aide, Mykhaylo Brodskyy. Both Zinchenko and Brodskyy pointed to Poroshenko as the main backstage operator in Ukrainian politics, who allegedly obstructed the government's activities and pursued private interests in his official position. Yushchenko, in explaining his decision to sack Tymoshenko's cabinet and Poroshenko, said his colleagues in the government have "lost the team spirit" and "concentrated on PR activities" instead of working toward implementing Orange Revolution ideals.

According to most Ukrainian commentators, Yushchenko's radical move on 8 September has temporarily strengthened his position as the top arbiter in the Ukrainian political arena and the guarantor of the country's stability. Both the government and the president have been steadily losing popularity in recent months among the public, while the Orange Revolution pledge to return dishonestly privatized properties to the people has been perceived by an increasing number of people in Ukraine as just a slogan covering the redistribution of those properties among oligarchic clans. In the short run, Yushchenko appears to have gained a lot in the eyes of those Ukrainians who still believe that the Orange Revolution was about more democracy and less corruption in their country than about bestowing government posts and benefits upon revolution heroes.

However, any further progress in pushing the Orange Revolution program seems to be an uphill task for Yushchenko. Without doubt, Yushchenko has made a very prudent move by appointing Yuriy Yekhanurov as caretaker prime minister. Yekhanurov, who has extensive experience in many government posts, is widely seen as a technocrat and is therefore expected to form a government of experts and economists rather than revolutionary combatants. And Yekhanurov stands a very good chance of being approved by the Verkhovna Rada. But it is very unlikely that he will be allowed by parliament to pursue any radical reforms prior to the March 2006 parliamentary elections.

As testified by a number of abortive votes in the Verkhovna Rada in July on government-proposed bills to facilitate Ukraine's joining the World Trade Organization, Yushchenko cannot count on a reliable parliamentary majority to support his reformist agenda. Now, after Tymoshenko's dismissal, the chances of forging a lasting parliamentary alliance for the government are even slimmer. The best that can be expected from the new cabinet is to maintain macroeconomic stability in the country in the run-up to and during the 2006 parliamentary election campaign, and to secure supplies of Russian gas for 2006 at a tolerable price.

While Tymoshenko was prime minister, it was understood that Yushchenko's Our Ukraine People's Union and the Yuliya Tymoshenko Bloc would form a parliamentary election coalition, preferably together with the People's Party headed by parliamentary speaker Volodymyr Lytvyn, to counter the forces that in the Orange Revolution supported Yushchenko's presidential rival, former Prime Minister Viktor Yanukovych. Now the probability of such a coalition seems to be virtually nil. On the contrary, many expect a bitter election confrontation between pro-Yushchenko and pro-Tymoshenko forces. Such a development might lead to a serious political disorientation among adherents of the former Yushchenko-Tymoshenko revolutionary duet and add to their further disillusionment.

Yushchenko's political position may also be considerably undermined by the political reform that is going to take effect on 1 January. The reform, which was adopted as a compromise to overcome the presidential-election standoff in 2004, will shift the center of political power in Ukraine from the president to the cabinet and parliament. Some in Ukraine speculated that Yushchenko might somehow cancel this reform to prevent a curtailment of his prerogatives. Now that Tymoshenko has become Yushchenko's political rival and is supposed to fight for the post of prime minister against the pro-Yushchenko forces in the upcoming parliamentary elections, she will hardly be interested in canceling the political reform to preserve Yushchenko's political clout. Which is another argument to support the assumption that the stakes in the 2006 parliamentary elections in Ukraine will be very high and that the elections themselves will be a political fight with no rules. (Jan Maksymiuk)

A CONFLICT OVER GAS AND POWER. The long-simmering conflict between former Prime Minister Yuliya Tymoshenko and National Defense and Security Council Secretary Petro Poroshenko, which most Ukrainian analysts believe led to the dismissal of her government on 8 September, had already grown intense by early this summer.

In mid-summer, Poroshenko made a number of statements demanding a far-ranging reform of the Ukrainian Security Service (SBU), then headed by Oleksandr Turchynov, a Tymoshenko loyalist and widely regarded in the media as a scrupulously honest broker.

This surprised many people, for it was the first time that Poroshenko had expressed this view and it came after a decision to reform the SBU had already been adopted by President Viktor Yushchenko and Turchynov anyway. Why did Poroshenko suddenly become so adamant about reforming the SBU at that time?

On 18 June Turchynov announced that a number of criminal investigations dealing with corruption in the gas industry had been launched, Interfax reported. Turchynov and Tymoshenko both made strong statements condemning the previous government's use of a middleman, Eural Trans Gas, and its replacement, RosUkrEnergo, to act as the transit operator for Turkmen gas to Ukraine. According to Tymoshenko, the use of these companies had cost Ukraine "more than $1 billion."

In her televised appearance on 9 September, Tymoshenko said that she had gone to see Yushchenko about the allegedly crooked schemes in the gas sector, and his response was to forbid her from dealing with the energy sector.

Turchynov, according to Interfax on 18 June, placed responsibility for the Eural Trans Gas deal on former President Leonid Kuchma; Yuriy Boyko, the then head of Naftohaz Ukrayiny, the state energy monopoly; and on "the highest state officials in Ukraine and Russia."

After Turchynov's announcement, the Russian gas monopoly Gazprom announced that it would raise the prices it charged Ukraine for gas to international levels. Also soon afterward, the Russian Military Prosecutor's Office announced that Tymoshenko was still under investigation for bribery and fraud, despite the fact that Interpol had earlier announced that Tymoshenko had been cleared of all charges.

While it's not clear that the military prosecutor's announcement was in any way related to Turchynov's allegations of high-level corruption in Russia, it seems unlikely that a prosecutor would say such things about Ukraine's prime minister without the approval of Russia's highest political leadership.

Then, on 3 July Interfax quoted Tymoshenko as saying that the RosUkrEnergo scheme was a "criminal enterprise" and warned unnamed officials close to Yushchenko "not to replace the old schemes of the Kuchma government with new ones." She added that Naftohaz was "beyond the control of the cabinet of ministers" and that she had asked the new head of Naftohaz, Oleksiy Ivchenko, to report on Naftohaz's activities at a cabinet meeting. Ivchenko never attended the meeting, claiming to have suddenly gone on vacation.

Ivchenko, a member of the Congress of Ukrainian Nationalists, a small party in the Verkhovna Rada that supports Yushchenko, was allegedly chosen to head Naftohaz Ukrayiny by Poroshenko and Oleksandr Tretyakov, Yushchenko's top aide. Tymoshenko consistently denied having been consulted about his appointment, despite ordering that all heads of state-owned companies should be appointed on the basis of competition.

Poroshenko, however, did not seem to attach any great significance to the investigation of RosUkrEnergo and never mentioned corruption in the gas business as a major concern. In an interview with the Internet publication Obkom, he downplayed the allegations of criminal connections to Eural Trans Gas and said that all he knew about the case was from media reports.

On 5 July, Poroshenko told Interfax that there were no significant problems in the gas business and that "the good relations between Presidents Yushchenko and Putin" would insure that all gas-related issues would be peacefully settled.

Then on 6 July, Yushchenko sent a letter to Tymoshenko in which, according to Interfax, he said that all "rumors" about Naftohaz must end and that the company should not be drawn into "political intrigues." He chided Tymoshenko and her colleagues for "unthought-through, emotional articles by people who have no relation to the gas sector." People close to Tymoshenko believe that this letter was in fact composed by Tretyakov, who later was accused of corruption by presidential chief of staff Oleksandr Zinchenko.

On 13 July, Interfax reported that the SBU had given Yushchenko documents detailing the alleged illegalities of the RosUkrEnergo middleman arrangement. Tymoshenko was quoted in the same report as saying that Naftohaz should itself be the middleman and not pay others to transport Turkmen gas to Ukraine.

The defenders of RosUkrEnergo responded to these charges in an article in the Internet publication Forum on 4 August, in which author Yuriy Zakrevskyy wrote that without RosUkrEnergo, Ukraine would be forced to pay even more for gas and that the country should be grateful to such a company "built on Western principles and totally transparent."

As the situation heated up, Interfax reported on 12 August that the SBU had conducted a search of Naftohaz headquarters for documents relating to RosUkrEnergo. Interfax reported that the company's new management reportedly collected materials and gave them to the Prosecutor-General's Office, SBU, and other law enforcement bodies, which allowed a number of criminal cases to be filed.

A week later, on 20 August, Interfax quoted Poroshenko as saying that "the SBU was itself a danger to the security of the state" and needed major revamping. This was widely regarded as a formal declaration of war on Turchynov by Poroshenko.

Tymoshenko, in her televised appearance on 9 September, shed further light on the conflict when she said that at a meeting just prior to her dismissal with Yushchenko, Poroshenko, and others close to the president, she was asked to agree to SBU head Turchynov's dismissal. Tymoshenko refused and told the television audience that Turchynov was considered a threat by those present at that meeting.

In late August, Poroshenko announced that he would go to Moscow personally to negotiate with Gazprom on prices for gas and to arrange a long-term supply agreement. Although he was not a cabinet member and thus not legally empowered to negotiate on behalf of the government, Yushchenko did not interfere and Tymoshenko could not prevent him from going.

Former Naftohaz head Yuriy Boyko, who is under investigation in the Eural Trans Gas-RosUkrEnergo affair, continued to deny any wrongdoings and on 5 September issued a statement saying that he was filing a libel suit against Tymoshenko. Two days earlier, Boyko publicly accused the SBU of following him and said that he feared for his life, Interfax reported. Whether he coordinated this announcement with anyone from Yushchenko's inner circle is not known, but few believe that it was coincidental.

The SBU investigation into the transit of Turkmen gas was also looking into the role, if any, played by Tretyakov, the 35-year-old businessman who was Yushchenko's top aide.

Tretyakov, according to a 31 January report by RFE/RL's Ukrainian Service correspondent Serhiy Rudenko, made his money in the oil-and-gas business in Ukraine, was the owner of a company named ATEK-95, and while in parliament was a member of the Energy Committee.

ATEK-95 was a company which dealt with oil and gas and was affiliated with a company, TiKo, that owned filling stations and supermarkets in Kyiv and was affiliated with former Kuchma aide Dmytro Tabachnik's brother. ATEK-95 eventually came under the control of an offshore holding company based in the Bahamas, Thyssen Corporation, in which Tretyakov is a shareholder.

In July, Tretyakov was named by the website Obkom as having arranged a meeting between Yushchenko and Dmytro Firtash, one of the main players in Eural Trans Gas and a man believed to be closely associated with RosUkrEnergo. Firtash bought a television broadcasting license in Ukraine during the last days of the Kuchma administration and was accused of owing a large sum of money ($28 million) to the Moscow-based Itera corporation, which is the subject of litigation in Moscow. Tretyakov has denied knowing Firtash and introducing him to Yushchenko.

In his statement (as published on the Ukrainian website Obozrevatel on 5 September) charging Tretyakov with corruption, presidential chief of staff Zinchenko claimed that Tretyakov, after his appointment as Yushchenko's top aide, became a member of the supervisory boards of a major bank, Oschadbank, and Ukrtelekom. These positions had previously been held by Kuchma adviser Serhiy Lavochkin. Zinchenko believed that these supervisory posts were being used by Tretyakov as part of an influence-peddling scheme.

Zinchenko also accused Tretyakov of trying to control the gas business in Ukraine but did not go into specific details except to say that it was Tretyakov who insisted on keeping Ihor Voronin as deputy head of Naftohaz. Voronin, according to Zinchenko, was deeply involved in the Eural Trans Gas-RosUkrEnergo affair.

With Tymoshenko and Turchynov gone, it will be important to see if the SBU investigation of RosUkrEnergo and Eural Trans Gas continues and is brought to trial. If, however, the case is closed due to lack of evidence or lack of will to prosecute, it will raise further questions about Yushchenko's commitment to transparent government and his ability to fight high-level corruption.

As information began leaking out of Kyiv after Tymoshenko's dismissal, it became clear that Turchynov was being targeted by Poroshenko and Tretyakov and the reason was most likely gas and money as represented by the shady RosUkrEnergo deal.

During his presentation of the new SBU chief, Ihor Dryzhchanyy, on 12 September, Yushchenko lashed out at Turchynov for his "incompetent" leadership of the SBU -- although a month earlier, during a meeting with the top SBU leadership, Yushchenko praised the SBU and its head for their hard work and incorruptibility.

It also emerged that former Naftohaz head Boyko had been questioned by the SBU in the RosUkrEnergo-Eural Trans Gas investigation. The SBU at that time decided that Boyko should be arrested, but his arrest was forbidden by the presidential administration. Boyko, apparently feeling strong support from on high, began his campaign attacking Turchynov, the SBU, and Tymoshenko.

On 12 September, Interfax reported that Naftohaz chief Ivchenko announced that he had signed a contract with Turkmenistan's national gas company for delivery of 39 billion cubic meters of gas in 2006. According to high-level sources in Kyiv, the middleman for delivery of this gas will remain RosUkrEnergo.

At a press conference on 12 September, Russian Ambassador to Ukraine Viktor Chernomyrdin praised the removal of Tymoshenko and said that the criminal charges against her by the Russian Military Prosecutor's Office were being dropped. (Roman Kupchinsky)

PRESIDENT NOMINATES 'STOPGAP' PRIME MINISTER. Immediately after dismissing the government of Prime Minister Yuliya Tymoshenko on 8 September, President Viktor Yushchenko announced that he wanted Dnipropetrovsk Oblast Governor Yuriy Yekhanurov to form a new cabinet. On 13 September, Yushchenko submitted the candidacy of Yekhanurov for the Verkhovna Rada's approval, stressing that he wants to have a "pragmatic government." Yekhanurov needs at least 226 votes to obtain the job.

Most political observers in Ukraine do not foresee any problems in Yekhanurov's approval, particularly after Yushchenko and Yekhanurov on 13 September signed a Declaration of Unity and Cooperation for the Future with leaders of parliamentary factions comprising nearly 240 deputies. The signatories pledged to pool their efforts "to secure the interests of the Ukrainian people, improve their welfare, consolidate society, and boost Ukraine's authority in the world." Making a new cabinet get down to work without delay is no doubt a priority in this endeavor.

Yekhanurov is widely seen in Ukraine as an experienced and efficient administrator without political ambitions. Therefore, many assert, he is the best choice Yushchenko could make for the six months that remain until the parliamentary elections in March, when the political scene in Ukraine may undergo a considerable rearrangement. In other words, Yekhanurov is seen as a "stopgap" prime minister whose main concerns will be to draft a 2006 budget, secure a tolerable price for Russian gas supplies next year, and push through the parliament what remains of the previous cabinet's package of bills intended to facilitate Ukraine's access to the World Trade Organization by the end of this year.

Yekhanurov, an ethnic Buryat, was born in a village in Sakha (Yakutia) in 1948. His family moved to Ukraine in 1963. In Kyiv, Yekhanurov graduated from a construction school in 1967 and from the Institute of People's Economy in 1973. He climbed the career ladder in the construction industry to the post of deputy director for economic issues of Kyiv's main construction directorate.

After Ukraine gained independence in 1991, Yekhanurov moved to the Cabinet of Ministers, where he initially served as a departmental director and then was promoted to the post of deputy economy minister. In 1994-97 he oversaw the initial stage of Ukraine's privatization as head of the State Property Fund. Subsequently he served as economy minister and deputy head of the presidential administration. At that time he belonged to the People's Democratic Party, a "party of power" that provided political support to President Leonid Kuchma.

In 1998 Yekhanurov was elected to the Verkhovna Rada from a one-seat constituency in Zhytomyr Oblast. From 1999 to 2001 he worked as first deputy prime minister in a cabinet headed by Viktor Yushchenko. When Yushchenko was dismissed as prime minister in 2001, Kuchma employed Yekhanurov as first deputy head of the presidential administration.

In November 2001, Yekhanurov left Kuchma for good and tied his political fate closely to that of Yushchenko. He became deputy chief of the election campaign of Yushchenko's Our Ukraine bloc and was elected to parliament in March 2002 from Our Ukraine's list. In 2004, Yekhanurov became deputy chief of Yushchenko's presidential election campaign. In March 2005, he was elected head of the executive committee of the Our Ukraine People's Union, Yushchenko's "party of power." In April, Yushchenko appointed Yekhanurov governor of Dnipropetrovsk Oblast after his predecessor was accused of having backed Yushchenko's rival in the presidential election.

Perhaps it is also not without significance for Yushchenko in his current situation that Yekhanurov is one of the very few in the Ukrainian president's entourage who back Ukraine's membership in the Single Economic Space with Russia, Kazakhstan, and Belarus. "This is a businesslike man, a man who deeply understands economics and economic relations, including those between states," Russian Ambassador to Ukraine Viktor Chernomyrdin said in praising Yekhanurov earlier this week.

In other words, Yekhanurov appears to be the opposite of the politically overambitious and charismatic Tymoshenko, whom Yushchenko accused of focusing on "PR activities" rather than on the presidential election program. Yekhanurov seems to be the man that will easily accept his place in the shadow of Yushchenko. But this may have drawbacks for the Ukrainian president as well, because now voters will be more likely to see Yushchenko -- not Yekhanurov -- as the real leader of the government. If things in Ukraine continue to go poorly, Yushchenko will not be able to lay all of the blame on Yekhanurov and fire him as the main culprit, as he did with Tymoshenko. (Jan Maksymiuk)