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January 12, 2007

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Reference ID Created Released Classification Origin
07KYIV89 2007-01-12 16:36 2011-08-30 01:44 CONFIDENTIAL Embassy Kyiv

DE RUEHKV #0089/01 0121636
P 121636Z JAN 07

C O N F I D E N T I A L SECTION 01 OF 03 KYIV 000089 
E.O. 12958: DECL: 01/11/2017 
REF: 06 KYIV 4681 
Classified By: Ambassador for reasons 1.4(a,b,d). 
1. (C) Summary.  After a pleasant January 10 meeting between 
President Yushchenko, Prime Minister Yanukovych, and Rada 
Speaker Moroz aimed at starting 2007 on a more cooperative 
note, Ukraine's political dynamics took another unexpected 
turn January 12, with Regions abandoning cooperation with 
Yushchenko in favor of cutting a deal with the Tymoshenko 
bloc (BYuT) on the last day of this Rada session.  Rather 
than working together with Yushchenko to develop a compromise 
joint draft on the Cabinet of Ministers law as promised 
January 10, Regions rejected all Presidential requests in 
committee and on the floor January 12 and secured BYuT's 
support for a veto override in exchange for approval of a law 
on imperative mandates for local municipal council members 
and approval of a first reading of a law on the opposition 
that would give BYuT extensive rights.  A shocked OU faction 
walked out of the Rada chamber after the veto override, 
refusing to return for the end of session speeches by PM 
Yanukovych and Speaker Moroz.  Both speeches focused on the 
importance of the CabMin law and Government-Rada cooperation. 
2. (C) Comment: The January 10 meeting of the two Viktors, 
joined by Speaker Moroz, appeared to fall the pattern 
described reftel of personal engagement resulting in the 
resolution of specific issues.  However, the latest twists 
leave the short-term prospects of Presidential-PM cooperation 
uncertain, with some Regions MPs openly talking of the 
arrival of a Ukrainian "Chancellor" making the president a 
marginalized figurehead.  Deputy Head of the Presidential 
Secretariat Yatseniuk, Yushchenko's representative to the 
Cabinet of Ministers, said that Yushchenko would lodge a 
request January 15 to the Constitutional Court to review the 
CabMin law, and that Yushchenko would not sign any laws 
passed by the Rada January 12.  Yanukovych confidante Hanna 
Herman claimed to us after the vote that the PM had changed 
his mind on the way forward politically after learning of 
"disturbing news" late January 11 that led him to believe he 
could not trust Yushchenko.  Herman said she rewrote 
Yanukovych's end of session speech, taking out talk of 
cooperation with the President.  Earlier January 12, the Rada 
also approved the appointment of Volodymyr Radchenko as 
Deputy Prime Minister; Radchenko said he would work on law 
enforcement, security, and defense issues, seemingly 
encroaching on core Presidential responsibilities.  End 
summary and comment. 
Starting off the New Year with bonhomie... 
3. (SBU) Ukraine's political new year began with a friendly 
trilateral session January 10 between Yushchenko, Yanukovych, 
and Moroz to discuss how to facilitate cooperation between 
jostling governmental institutions.  At a press conference 
after the meeting, Yushchenko announced that an array of 
agreements had been reached, including: to form a 
constitutional commission to review needed implementing 
legislation; to work jointly to rewrite the law on the 
Cabinet of Ministers in the aftermath of his veto of the 
coalition's passed version; to develop a joint plan to 
implement the Universal by holding a new roundtable on 
February 14; to agree on all governmental nominations; and to 
follow up on economic issues such as land reform and WTO 
accession.  The meeting seemed to follow the pattern of 
resolving differences laid out in reftel. 
...turning quickly sour 
4. (SBU) Within 48 hours, however, dynamics shifted 
significantly.  Early on January 12, Regions implemented a 
much different strategy on the Cabinet of Minister law review 
than had been discussed by Yushchenko, Yanukovych, and Moroz. 
 Rather than working on a joint version of a new law as 
announced, Regions rejected all Presidential suggestions in a 
committee session without OU MPs or Yatseniuk, the 
President's representative on the bill, present.  Yatseniuk 
later angrily denounced the changes and accused Moroz of 
violating the agreement with Yushchenko from the floor of the 
Rada before storming out of the chamber, as OU MPs rushed the 
floor rostrum.  To no avail.  After all 40 Presidential 
amendments were rejected, Moroz called for a vote to override 
Yushchenko's veto of the previously passed CabMin law.  With 
BYuT joining Regions, the Socialists, and the Communists in 
voting unanimously, the override vote succeeded, to OU cries 
of "shame" and "betrayal." 
5. (SBU) As Regions and Socialist MPs clapped and jeered, an 
unrepentant Tymoshenko accused OU in return of having been 
KYIV 00000089  002 OF 003 
the party that had brought down the orange coalition in 2005, 
prevented the reformation of a democratic coalition in 2006, 
supported Yanukovych's PM nomination in August, and tried 
repeatedly but unsuccessfully to cut its own deal with 
Regions not over principles but government posts.  It was 
time to stop the fight for power between the two Viktors 
which was paralyzing the country domestical
ly and ruining its 
image internationally and allow the country and government to 
move forward, Tymoshenko declared. 
The Regions-BYuT deal: convergence of interests 
--------------------------------------------- -- 
6. (SBU) The tactical Regions-BYuT deal resulted in a series 
of tradeoff votes, as Regions and BYuT deputy leaders 
candidly admitted in the Rada lobby afterwards.  The CabMin 
bill veto override was followed in quick succession by 
passage in a single reading of a law requiring an imperative 
party mandate for local council representatives, as well as 
approval in a first reading of a law giving extensive powers 
to the opposition, both BYuT objectives.  BYuT deputy leader 
Turchynov explained that BYuT would use the local council 
imperative mandate to discipline Kyiv City Council MPs who 
had strayed and would attempt to form a new majority.  He 
shrugged off criticism of BYuT having enabled Yanukovych via 
the override by noting that if the government failed to 
deliver on its promises, Tymoshenko could return as PM and 
prove more effective.  BYuT MP Polokhalo told us that BYuT 
was tired of the constant fighting between the two Viktors' 
camps, Yushchenko's losing efforts to cooperate with Regions, 
and Yushchenko's refusal to work with BYuT as a partner; the 
override vote cut a Gordian knot of Ukrainian politics, he 
7. (SBU) Yanukovych confidante Herman told us January 11 that 
Yanukovych's end of session speech she had drafted would 
emphasize the approach of cooperation with Yushchenko coming 
out of the January 10 session.  Herman explained the sudden 
change in approach to what she characterized as "important 
new information" which had come to Yanukovych's attention 
late on January 11; he had concluded that he could no longer 
trust Yushchenko (Note: others suggested that this 
"development" involved allegations that Yushchenko had 
recently authorized the SBU to wiretap the phone 
conversations of Speaker Moroz.)  Herman had rewritten 
Yanukovych's speech accordingly.  "Now Ukraine has its 
Chancellor; Regions no longer needs to worry about contesting 
the 2009 Presidential elections," she added in conclusion. 
Yanukovych and Moroz sum up without mentioning Yush 
--------------------------------------------- ------ 
8. (SBU) Yanukovych's 10 minute speech at the Rada session 
summing up the results of the past six months and looking 
forward was perhaps most notable for its failure to mention 
Yushchenko or the institution of the presidency once. 
Instead, he extolled the virtues of Ukrainian parliamentarism 
as a unifying and productive force for Ukraine, with the 
Cabinet-Rada partnership the most important dynamic in 
Ukrainian politics.  While the Rada's session may have 
started in conflict, it was ending in hope for the future: 
prospects of economic growth and the consolidation of 
society.  Moroz's lengthier comments highlighted the same 
themes, emphasizing the Rada's achievements.  His only 
mention of the presidency came in a passing footnote to the 
numbers of bills passed in the session (130); of the 35 
drafts forwarded by the president's secretariat, the Rada had 
passed 17. 
What next? a Rada break through Feb 5, reassessment 
--------------------------------------------- ------ 
9. (C) Even before the CabMin veto override, Regions had 
continued chipping away at Presidential authority earlier 
January 12, pushing through the appointment of ex-Kuchma SBU 
chair and National Security and Defense Council (NSDC) 
Secretary Radchenko, who has served as a Yanukovych adviser 
since September, as a new Deputy Prime Minister who would 
oversee law enforcement, national security, and defense 
issues and agencies - a key part of what Yushchenko's team 
considers his remaining constitutional prerogative. 
Separately, two Regions MPs introduced a bill to abolish the 
posts of NSDC Secretary and deputy Secretaries, currently 
presidential appointments, and require joint Presidential and 
PM signatures on all NSDC decisions (currently a presidential 
right).  The GOU financial clearing house under DPM Azarov's 
control is refusing to recognize the validity of FM 
Tarasyuk's signature, leading to MFA officials not being paid 
and projects to stall, according to an MFA contact. 
Yatseniuk made the predictable announcement that Yushchenko 
would appeal the CabMin law to the Constitutional Court on 
KYIV 00000089  003 OF 003 
January 15 and refuse to sign any bills passed January 12. 
10. (C) Comment: it is not clear whether Yushchenko has the 
stomach or the tools to push back against Regions' latest 
effort to curtail his influence.  He and his team will need 
to reassess his options for the prospects of cooperation in 
light of the most recent developments, which have left some 
in Regions openly asserting that Yushchenko has now been 
marginalized, with power firmly in the hands of Yanukovych as 
10. (U) Visit Embassy Kyiv's classified website: 




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