March 4, 2016

Jaresko emerges as top candidate for prime minister

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Andrey Kravchenko/UNIAN

Chicago-born Natalie Jaresko, Ukraine’s finance minister and now a top candidate to replace Arseniy Yatsenyuk as prime minister, addresses a Cabinet of Ministers meeting on February 4.

KYIV – Chicago-native Natalie Jaresko, the current finance minister of Ukraine, is among the top candidates to succeed the embattled Arseniy Yatsenyuk as prime minister, according to Kyiv insiders and recent news reports.

She has already begun forming a Cabinet of Ministers consisting of technocrats, reported the rbc.ua news site on February 26, citing an anonymous source identified only as being “in the coalition.” President Petro Poroshenko has offered her the post already, the hromadske.tv news site reported on February 26, citing someone “familiar with the talks.”

The latest turn of the rumor mill ended without Ms. Jaresko being nominated as prime minister, and without Mr. Yatsenyuk’s resignation, which also was rumored. Yet she’s at the top of the president’s list, said Volodymyr Fesenko, a Kyiv political pundit who has intimate ties with the Presidential Administration

“The rumors reflect the truth, to a large extent. She is among the potential contenders,” said Mr. Fesenko, the head of the Penta Center for Applied Political Research. Speaking with The Ukrainian Weekly’s correspondent on March 1, he didn’t discount the rumor that the president had already offered her the post behind closed doors.

Ms. Jaresko’s candidacy is being raised by Western authorities who are desperate for a technocrat committed to reforms and anti-corruption, as opposed to setting up and covering for corrupt schemes, as has been alleged of numerous current Cabinet ministers, including Mr. Yatsenyuk.

“Jaresko stands outside the old corrupt networks in Ukraine,” said Anders Aslund, a resident senior fellow at the Atlantic Council in Washington. “She is highly considered both in Ukraine and abroad, and she has proven herself highly competent as finance minister at a very tough time.”

Mr. Poroshenko has discussed Mr. Yatsenyuk’s successors with U.S. Vice-President Joe Biden, Mr. Fesenko said. The potential successors include Ms. Jaresko, former Georgian President and Odesa Oblast State Administration Chair Mikheil Saakashvili, and Presidential Administration Deputy Head Dmytro Shymkiv, a Lviv native and former CEO of Microsoft Ukraine.

If any of these candidates is chosen, it would mark the first time an outsider to the Ukrainian political and business oligarchy would become Ukrainian prime minister, experts pointed out. But that’s precisely what stands in the way of Ms. Jaresko’s candidacy, they said.

In sacrificing the prime minister’s post, Mr. Yatsenyuk’s party will require compensation in the form of lucrative government posts, said Petro Oleshchuk, an assistant professor at Taras Shevchenko National University in Kyiv.

“Without political support, it’s very hard to strive for an independent role,” he said. “Such an appointment is theoretically possible, but all the parties involved will demand a large number of state positions in return, which would nullify the value of such an appointment. She won’t have freedom to maneuver and could become hostage to the situation.”

Ms. Jaresko also lacks a parliamentary faction to back her on the legislative front and has already made some enemies with her tax reform efforts, rejecting alternative proposals.

Besides that, the populist Oleh Liashko, head of the Radical Party, has already pounced on the notion that a foreign-born person should not be prime minister (though Ms. Jaresko has lived in Kyiv since 1991.)

“About 170 national deputies (out of a 226-vote majority) were ready to vote for her in February,” Mr. Fesenko pointed out. “But she won’t gain approval without active campaigning.”

When asked about her possible candidacy, Ms. Jaresko has avoided commenting.

“To tell the truth, I don’t want to speak today about personnel issues. We need to focus attention not on personnel, but on principles,” she told the “Freedom of Speech” show on the ICTV television network on February 8.

Aivaras Abromavicius, the economic development and trade minister who resigned on February 3, told the Deutsche Welle news agency in an interview published on February 15 that Ms. Jaresko is “skeptical” about becoming prime minister because “it’s the most difficult task in the most difficult conditions in the absence of support.”

“So she needs to get the prime minister and president to guarantee that their parties will vote for all Cabinet initiatives,” he said.

To do her job, Ms. Jaresko should have full freedom and carte blanche in appointing ministers, without any political or financial influences, Mr. Abromavicius told the BBC.

While that demand might be unrealistic in the cynical realm of Ukrainian politics, some concessions may prove necessary as the president needs a reformer like Ms. Jaresko to work with the International Monetary Fund, which has withheld its latest loan tranche of $1.7 billion that could have arrived as early as late January.

The postponement is due to the lack of political stability, including the failed attempt to dismiss Mr. Yatsenyuk and ongoing efforts to remove him, said Alexander Paraschiy, the head of research at Concorde Capital investment company in Kyiv.

“In order to release the tranche, the IMF needs a report of reforms and an action plan signed by key state officials,” he said. “Those who sign take the responsibility upon themselves and the IMF must be sure they have the ability to fulfill these tasks and will be in their positions for the next two to three months.”

Since Mr. Yatsenyuk and his Cabinet aren’t even sure they’ll be around for so long, they can’t sign anything, he said.

Mr. Poroshenko and other top officials have been trying to convince Mr. Yatsenyuk to leave of his own will, Mr. Fesenko said. Several news agencies on February 26 reported his willingness to resign, citing high-placed anonymous sources. Yet his spokeswoman immediately dismissed those reports, which went unproven.

That same evening, the Cabinet website reported that Mr. Yatsenyuk said in an interview with a German newspaper that he advised the president to form a new government if he no longer suits him. That will require early parliamentary elections, Mr. Yatsenyuk warned the president, in which case he won’t have anyone to fulfill the IMF loan requirements.

But observers said that a new Cabinet can be formed by keeping the current Parliament and merely forming a new coalition government involving a new combination of its six factions.

That combination has yet to be achieved as Mr. Liashko was reportedly in talks in late February to become chair of the Verkhovna Rada, but they didn’t materialize. His Radical Party would have been able to form a coalition with the Poroshenko Bloc and Mr. Yatsenyuk’s People’s Front.

The Batkivshchyna and Samopomich factions abandoned the coalition on February 18 and 19, respectively, after the failed ouster of Mr. Yatsenyuk. A new configuration is required within 30 days, after which the president can dismiss the Verkhovna Rada and call early elections.

Instead, Ms. Jaresko could lead a technocratic government during an interim period until early parliamentary elections are held, possibly in the fall, said Dr. Aslund said. That would make the arrival of the next IMF tranche possible.

“She has proven herself highly competent as finance minister at a very tough time,” he said, referring to the finance minister’s success in negotiating the $15 billion debt restructuring with Ukraine’s creditors, preparing the 2016 budget that met IMF requirements and finding compromise on tax reform.

That kind of resume is just what Ukraine needs in the current political crisis that has worsened Ukraine’s standing in the West, observers said.

“She’s a convenient partner, she’s not a competitor and she ensures contact with the West,” Mr. Oleshchuk said. “Poroshenko needs her.”

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