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December 4, 2008

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Reference ID Created Released Classification Origin
08KYIV2383 2008-12-04 15:53 2011-08-30 01:44 CONFIDENTIAL Embassy Kyiv


DE RUEHKV #2383/01 3391553
P 041553Z DEC 08

C O N F I D E N T I A L KYIV 002383 
E.O. 12958: DECL: 12/04/2018 
REF: A. KYIV 2305 
     B. KYIV 2294 
Classified By: Ambassador William Taylor for reasons 1.4 (b,d). 
1. (C)  On December 4 the Ukrainian parliament (Rada) voted 
to invite President Yushchenko and PM Tymoshenko to an 
extraordinary session on December 9 to discuss the "situation 
in the country."  The Rada once again was unable to find 
consensus on a new Speaker, and voted to close the session 
after an eight minute discussion (Ref A).  Kyiv was rife with 
speculation that PM Tymoshenko's Bloc (BYuT) and Party of 
Regions (Regions) had agreed to form a coalition with Regions 
head Viktor Yanukovych as Rada Speaker.  Rada contacts told 
us that Yanukovych balked at inking a deal at the last 
minute.  Regions announced they will continue to negotiate 
through the weekend, and BYuT expressed confidence that a 
deal could be reached.  A sub-group of Our Ukraine-People's 
Self-Defense (OU-PSD) MPs have renewed their efforts to 
convince a majority of the faction to vote for a 
BYuT/Lytvyn/OU-PSD coalition before BYuT and Regions can make 
a deal.  President Yushchenko continues to oppose any 
rapprochement with BYuT.  End Summary. 
Eight Minute Rada Session 
2. (C) The Rada will remain without a Speaker until at least 
December 9, as factions were unable to find consensus yet 
again and the December 4 session was closed after eight 
minutes.  The Rada has been paralyzed since the November 12 
ouster of former Speaker Arseniy Yatsenyuk, since no Rada 
legislation can be sent to the President without the 
Speaker's signature.  The Rada voted to continue meeting in 
plenary next week, and factions announced that they would 
continue to negotiate through the weekend.  Before the 
session closed, 353 MPs voted to invite President Yushchenko 
and PM Tymoshenko to address an extraordinary session of the 
Rada December 9 to review "the situation in the country." 
Regions Backs Away from BYuT:  Deal Still Possible? 
--------------------------------------------- ----- 
3. (C) In the days leading up to the December 4 plenary 
session, Kyiv was rife with speculation that BYuT and Regions 
had finally settled on terms for a new coalition, with 
Tymoshenko retaining her PM position and Yanukovych moving to 
the Speaker's chair.  In an interview on December 3, 
Yanukovych stated that he was exploring a BYuT/Regions 
coalition as a way to protect the Ukrainian people from 
economic catastrophe.  Vice Speaker and Regions MP Oleksandr 
Lavrynovych opened the December 4 plenary by announcing that 
factions were unable to reach consensus on either a new 
Speaker or a new coalition. 
4.  (C) BYuT MP Kostyantin Bondareev told us that Yanukovych 
and a large portion of the Regions faction had agreed to the 
deal, but was persuaded to back away by Regions MPs loyal to 
oligarch Dmitry Firtash (Ref B), part owner of RosUkrEnergo 
(RUE) and Tymoshenko foe.  They reportedly convinced him that 
Regions should attempt to carve out a better deal with 
Yushchenko.  Regions MP Volodymyr Makayenko told us that 
others within Regions did not understand why the party would 
agree to a coalition without Yanukovych as PM, adding that 
all the Speaker position would give Yanukovych is a public 
position to sign anti-crisis legislation "that hurts regular 
5. (C) BYuT MP Valeriy Pysarenko said that, today's events 
notwithstanding, BYuT and Regions have agreed on about 90 
percent of the details necessary to form a coalition -- "only 
technical details remain."  After the session closed, Regions 
MP Hanna Herman said that Regions was ready to move "from 
consultations to active negotiation" and expressed hope that 
a deal could be reached over the weekend.  Regions later 
announced that they had assigned official negotiators to work 
with all other factions.  Herman mentioned that any 
negotiation with BYuT must include discussions on the PM 
position.  In a shift from BYuT's previous public position, 
Pysarenko said that BYuT was ready to discuss all positions, 
including the PM. 
6. (C) Makayenko claimed that support within Regions for an 
alliance with BYuT was far from unanimous.  Regions MP Serhiy 
Lyavochkin, a Firtash ally, announced that Regions would only 
agree to a coalition if Tymoshenko gave up her PM position - 
a possible poison pill in the negotiations.  He conceded that 
voluntarily giving up her position was a step she would be 
unlikely to take.  There is also disagreement within BYuT 
about a coalition with Regions.  Transport Minister and BYuT 
member Yosyp Vinskiy announced he would resign if such a 
coalition deal were reached.  Serhiy Sobolev, BYuT deputy 
faction head and head of the Reforms and Order Party, told us 
that he hopes the two factions do not unite.  He said he 
would rather give up all power than be a party to Regions' 
Yushchenko Courting Chaos: Can OU-PSD Go Around Him? 
--------------------------------------------- ------- 
7. (C) In a press conference December 4, Yushchenko announced 
that a Regions/BYuT coalitio
n was a serious threat to 
democracy, as the coalition would be intent on changing the 
constitution to weaken the presidency - a move Yushchenko 
said he would continue to fight.  Makayenko dismissed 
Yushchenko as an obstructionist, interested only in holding 
onto the presidency.  He told us that Yushchenko wants 
neither Tymoshenko nor Yanukovych as PM, as both are 
presidential aspirants, so he will not make any deal to break 
the Rada's paralysis, and will do everything to block any 
deal done without his blessing.  Andriy Yermolaev, Director 
of local think tank Sofia Center for Social Studies, told us 
that, if BYuT and Regions agree to a coalition, Ukraine 
should expect a flood of Kompromat (information intended to 
compromise or discredit someone) against BYuT and Regions 
members to be made public by the President's allies. 
8. (C) OU-PSD MP Kyrylo Kulikov told us that the potential 
BYuT/Regions agreement has given new impetus to the insurgent 
OU-PSD MPs to attempt to form a coalition with BYuT, Lytvyn 
and a majority of OU-PSD.  He said that support for their 
efforts remained at 33 MPs, but that a number of MPs could 
possibly be convinced to come to their side to head off a 
BYuT/Regions coalition.  Pysarenko noted that, while BYuT is 
negotiating with Regions, his party would still be interested 
in uniting with Lytvyn and OU-PSD.  OU-PSD deputy faction 
head Taras Stetskiv called on Yushchenko to "lift his ban" on 
such a grouping. 
9. (C)  The current political stalemate has now dragged on 
for over three months.  Whether the mutual distrust among top 
political figures can abate long enough for a new coalition 
to finally form -- perhaps BYuT-Regions at this stage -- 
remains to be seen.  Meanwhile, the economic forecasts are 
ominous, making the lack of a stable governing coalition 
needed to deal with the situation ever more glaring. 




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