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October 10, 2007

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Reference ID Created Released Classification Origin
07KYIV2555 2007-10-10 13:43 2011-08-30 01:44 CONFIDENTIAL Embassy Kyiv

DE RUEHKV #2555/01 2831343
P 101343Z OCT 07

C O N F I D E N T I A L SECTION 01 OF 02 KYIV 002555 
E.O. 12958: DECL: 10/10/2017 
REF: A. KYIV 2533 
     B. KYIV 2522 
KYIV 00002555  001.2 OF 002 
Classified By: Ambassador for reasons 1.4(b,d). 
1. (C) Summary.  Conversations on October 10 with key 
advisers for Yuliya Tymoshenko and PM Viktor Yanukovych, 
Hryhoriy Nemyria and Serhiy Lyovochkin respectively, 
underscore what we have been hearing for the past week -- the 
ball on coalition formation is in Yushchenko's court, but it 
may be Presidential Chief of Staff Baloha who is driving 
negotiations.  Both BYuT and Party of Regions are wooing the 
Presidential Secretariat, even more than they are Our 
Ukraine-People's Self Defense, but it is unclear what 
Yushchenko and his team will decide to do.  Nemyria described 
a series of demands Baloha passed to Tymoshenko that would 
greatly enhance the powers of the President and the 
Presidential Secretariat in exchange for Yushchenko's support 
for an orange coalition.  The President's team has also asked 
Tymoshenko to sign a letter requesting a Membership Action 
Plan for NATO, which Nemyria argued was simply a provocation 
designed to start a fight between Tymoshenko and Regions and 
to hurt the former's chances in a presidential election. 
Lyovochkin requested his meeting to brief the Ambassador on 
Yanukovych's October 9 trip to Moscow, apparently seeking to 
reassure the USG that the trip was not connected to coalition 
building.  He said that Regions has offered OU-PSD the same 
50-50 division of posts that BYuT offered and is now dealing 
with bloc leader Yuriy Lutsenko, the biggest opponent of such 
an arrangement. 
2. (C) Comment. Nemyria's report echoes what Baloha told us 
October 5 -- that Tymoshenko was not in control of the 
situation and that Baloha was laying out demands as the price 
for his (and presumably Yushchenko's) cooperation.  At the 
same time, it is clear that negotiations between Baloha and 
Regions's representatives, including Rinat Akhmetov's 
lieutenant Borys Kolesnikov and the PM's team continue.  A 
question that Nemyria raised and that others have been 
discussing is to what degree Baloha speaks for the President. 
 Unfortunately, just as in past key junctures in Ukrainian 
politics, Yushchenko has chosen to leave the country, this 
time for trips to Lithuania and Slovakia, leaving everything 
in Baloha's hands.  If Baloha were to be successful in his 
negotiations with either BYuT or Regions, he could find 
himself either the head of a stronger presidential 
administration, or even Prime Minister, the position that 
some believe is his ultimate goal.  End comment. 
Nemyria: Baloha has Escalated his Demands 
3. (C) Nemyria told the Ambassador October 10 that Baloha had 
given Tymoshenko a list of 14 demands, all of which were 
conditions for forming an orange coalition.  He also said 
that Baloha began the enumeration of demands by saying, 
"Yuliya, please know -- the U.S. Government supports a broad 
coalition.  David Kramer told me that."  (Embassy note:  The 
Ambassador quipped that DAS Kramer would be very surprised to 
hear such a quote attributed to him.  End Note.)  Nemyria 
said that Baloha's demands included: 1) the President be 
given control over the Interior Ministry, the State Tax 
Administration, and the Customs Service, in addition to the 
power ministries he already controls (Ministry of Defense, 
the SBU and the Prosecutor General's Office); 2) the 
constitution be amended to return Ukraine to a presidential 
system; 3) the law on the Cabinet of Ministers be amended to 
include the phrase that the government is obliged to obey 
instructions from "the apparatus of the NSDC and the 
Presidential Secretariat"; 4) all governors and raion heads 
be selected by the president; 5) these governors and raion 
heads must approve the appointment of all ministry 
representatives at the oblast and local level; 6) the 
President will pick the next mayoral candidate in Kyiv; 7) 
Tymoshenko will sign a public agreement to back Yushchenko in 
the next presidential election; and 8) Tymoshenko will appear 
at a rally with Yushchenko next week to greet officers from 
the Ukrainian Insurgent Army (UPA).  In addition, Tymoshenko 
must agree that the newly seated Rada will vote, in order on 
1) the Speaker, probably Kyrylenko with a Regions first 
deputy; 2) all the legislation connected to the first set of 
demands; and then 3) the Prime Minister.  Finally, Baloha 
asked Tymoshenko to sign a letter that would come from her 
and Yushchenko to NATO Secretary General de Hoop Sheffer 
asking for a MAP at the upcoming Bucharest summit. 
4. (C) Nemyria said these demands were clearly not 
confidence-building measures and some of them were simply 
unacceptable.  BYuT did not like the empowerment of the 
presidency and Presidential Secretariat at the expense of the 
KYIV 00002555  002.2 OF 002 
Cabinet. In addition, Tymoshenko did not want to publicly 
associate with UPA or ask for a MAP right now -- both would 
antagonize Regions and focus their attacks on her.  Nemyria 
wondered to what degree Yushchenko was aware of Baloha's 

demands -- he said that Baloha had been blocking phone calls 
to Yushchenko from Georgian President Saakashvilli, a 
proponent of an orange coalition, a sign that Baloha was 
trying to isolate the President.  Nemyria said he thought 
Baloha's end game was to make the demands so unpalatable for 
Tymoshenko that the orange coalition would collapse and 
Baloha could push through his "East-West Unity" coalition 
(ref A), with himself as Prime Minister.  In fact, Nemyria 
believed Baloha may have already hinted at that scenario to 
Rinat Akhmetov's lieutenant Kolesnikov. 
5. Note.  A number of these demands appeared in online news 
site Ukrainska Pravda on October 10, but not with the level 
of detail supplied by Nemyria.  BYuT and OU announced that 
they had formed working groups October 9 to develop three key 
pieces of legislation -- the law on the Cabinet of Ministers, 
the law on local administration, and the law on the 
opposition, so some effort is being made to meet the more 
palatable legislative requests.  End note. 
6. (C) In terms of who was really negotiating, Nemyria said 
the serious players were Baloha and NSDC Secretary Plyushch 
for the President, Tymoshenko and Turchynov for BYuT, and 
Kolesnikov and Akhmetov for Regions.  There was a lower level 
of negotiations going on, he added, between members of OU and 
BYuT on economic and legal issues to try to work out all the 
other parts of a government program and some of the 
outstanding power sharing issues.  Overall, Nemyria thought 
this level of cooperation was more positive, although he took 
the fact that former PM Yekhanurov refused to take part as a 
sign that part of OU was still inclined to a broad coalition. 
Lyovochkin: Regions Also Reaching out to Baloha 
--------------------------------------------- -- 
7. (C) Prime Minister Chief of Staff Lyovochkin asked to meet 
with the Ambassador on October 10 to brief him about PM 
Yanukovych's October 9 trip to Moscow, indirectly reassuring 
the USG that the trip had not been intended to get 
instructions on coalition negotiations from the Russians. 
According to Lyovochkin, the visit was about the gas deal and 
ongoing bilateral trade issues, including Ukrainian efforts 
to reopen Russian markets to Ukrainian meat and dairy 
products (halted since January 2006).  Then Lyovochkin turned 
to Ukraine's political situation, echoing his boss's thoughts 
from last week (ref B).  Baloha and Yushchenko had violated 
their agreements with Yanukovych regarding the holding of 
early parliamentary elections intended to result in a broad 
coalition -- by falsifying votes in the west and then 
negotiating with Tymoshenko -- which was why Regions was 
still not yet committed to taking their seats in the Rada. 
Lyovochkin said the new Rada should convene before a 
coalition is finalized.  First the Rada should pick a 
Speaker; he said former Speaker Plyushch would be a good 
choice, but Kyrylenko -- OU-PSD's preferred nominee -- was 
just a boy.  (Embassy note.  The "boy" is several years older 
than Lyovochkin himself.  End note.)  Then coalition 
negotiations could take place and a prime ministerial 
candidate put forward.  (Note. In the press, Regions said it 
would not take posts in a Tymoshenko Cabinet, since the 
opposition did not belong in the executive branch.  End note.) 
8. (C) Lyovochkin said that Regions was negotiating with 
Yuriy Lutsenko, who was the only OU-PSD leader opposed to a 
broad coalition.  They were talking about offering him the 
head of the Kyiv City administration.  (Note.  Kyiv's special 
status, which puts it on par with an oblast, means that it 
has a head of administration position equivalent to an oblast 
governor.  Traditionally the mayor of Kyiv has always been 
appointed head of the city administration, but it is not 
legally mandated.  This would put Lutsenko one step closer to 
the mayor's office, a key goal for him.  End note.) 
Lyovochkin said Regions was also offering OU-PSD the same 
50-50 division of government positions that BYuT had offered, 
with some posts reserved for Lytvyn.  Finally, Lyovochkin 
said that the McKinsey report Akhmetov had commissioned would 
be the basis of the economic program for a broad coalition, 
something of which Yushchenko approved.  Now the President 
just had to deal with a minor issue -- the promises he made 
to Tymoshenko. 
9. (U) Visit Embassy Kyiv's classified website: 




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