Home > Cabinet splits leave the Orange Revolution in tatters
By Tom Warner
Viktor Yushchenko, Ukrai-ne’s president, appeared dejected when he appeared in front of journalists yesterday to announce that, in effect, the Orange Revolution had ground to a halt.
The fervour that swept him and firebrand leader Yulia Tymoshenko to power last winter had dissipated, ground down by months of bickering among political camps that led to this week’s bitter accusations of corruption among top-ranking officials.
But much of the blame for the collapse of his first government falls squarely on Mr Yushchenko.
The divisions within government were already evident, and widely reported, well before he selected his cabinet in February. His solution, characteristic of his willingness to compromise, was to divvy up power by making Ms Tymoshenko prime minister, and her main rival, businessman Petro Poroshenko, secretary of the National Security Council.
Mr Yushchenko admitted yesterday: "I knew there were misunderstandings between them. All great people have problems. I took them to be temporary."
Almost from the start, Mr Yushchenko needed to intervene. He overruled Ms Tymoshenko’s more populist decisions, including a decision in March to review 3,000 privatisations conducted by the previous government, and a move in April to freeze retail petrol prices, during a time of surging oil prices, which created a fuel shortage.
The privatisations, however, proved the undoing of the entire government. Mr Yushchenko insisted on cancelling and re-selling only a limited number of state assets sold by the previous administration of former president Leonid Kuchma.
That appeased many investors, but the remaining cases - involving the largest former state assets - led to conflicts within his administration as big business groups lined up with one or the other political camp.
Those who had acquired the assets under the former regime and who risked losing them sought help from Mr Poroshenko, who sought to stop the re-sales. Those hoping to acquire new assets turned to Ms Tymoshenko and her team.
Vladimir Malinkovich, a political analyst usually critical of Mr Yushchenko, said the competing ambitions within Mr Yushchenko’s team and the "war between oligarch groups" made the crisis inevitable.
Ms Tymoshenko prevailed in the case of Kryvorizhstal, the country’s largest steel mill, which was sold under Mr Kuchma to his son-in-law, Viktor Pinchuk, for $800m (€645m, £435m) but which analysts believe is worth more than $2bn.
However, Ms Tymoshenko’s handling of the reversal of a 2003 sale to Mr Pinchuk of a majority stake in Nikopol Ferroalloy, the world’s largest producer of ferroalloys, provoked outrage from within Mr Poroshenko’s camp, who accused her of favouring another oligarch.
Ms Tymoshenko’s camp, in turn, accused Mr Poroshenko of attempting to helpa group of Russian and Ukrainian businessmenbuy the plant from Mr Pinchuk. The two camps also accused each other of seeking to assert control over national television channels ahead of parliamentary elections scheduled for next March.
Mr Yushchenko, meanwhile, was personally damaged when he was forced to admit that his 19-year-old son was driving a BMW sedan and living in a luxury apartment while paying only nominal rents to "friends" whom Mr Yuschenko has refused to identify.
The crisis came to a head earlier this week whenOlexander Zinchenko, Mr Yushchenko’s chief of staff, resigned and accusedMr Poroshenko and Olexander Tretyakov, Mr Yushchenko’s first aide, of corruption.