Friday, February 19, 2016

Ukraine Warning Intelligence Update: Social Unrest Likely as Ukraine’s Ruling Coalition Breaks

By Hugo Spaulding

Key Takeaway: Ukraine’s post-revolution leadership faces an existential crisis on the second anniversary of the collapse of Russia’s client regime in Kyiv, which transpired on February 21, 2014. The pro-Western coalition lost its parliamentary majority at a moment of severe popular distrust of President Petro Poroshenko and Prime Minister Arseniy Yatsenyuk. Without sustained efforts to support reform and combat corruption, Poroshenko faces the prospect of mounting social unrest and the resurgence of Ukraine’s political old guard.

Ukrainian President Petro Poroshenko’s party triggered the disintegration of the pro-Western four-party coalition by launching a failed vote of no confidence against Ukrainian Prime Minister Arseniy Yatsenyuk on February 16. Poroshenko called for Yatsenyuk’s resignation on the day of the vote after junior coalition parties announced their unwillingness to work with the prime minister, threatening to deadlock already stagnant efforts at economic and anti-corruption reform. The “Fatherland” party of former Prime Minister Yuliya Tymoshenko and the Western Ukraine-based “Self Help” party defected to the opposition in response to the failure of the no-confidence motion, which precludes another vote of no confidence until the next session of parliament begins in September. The withdrawal of the two junior parties deprives the “European Ukraine” coalition of its majority in parliament and takes it farther from the constitutional supermajority with which it began its mandate.

The collapse of the coalition is likely to ensure the continued stagnation of reforms necessary to maintain vital financial support from the International Monetary Fund (IMF), which signaled earlier this month that it would delay an assistance package worth $1.7 billion until the future of the cabinet became clear. Russia’s continued military operations in the southeastern Donbas region and economic pressure have also ensured that Ukraine’s pro-Western government remains frail. A protracted political struggle, worsening economic conditions, and the pro-reform elite and population’s hardening distrust of Ukraine’s leaders threaten to spiral into widespread social unrest.  Poroshenko may thus face a perfect storm on the anniversary of sniper attacks on protestors in the final days of the “Euromaidan” revolution.

President Poroshenko called for Yatsenyuk’s resignation in response to mounting domestic and Western pressure to kick-start Ukraine’s stalled anti-corruption and reform efforts. The failed no-confidence motion follows the February 3 resignation of Lithuanian-born Economy Minister Aivaras Abromavicius, who blamed pervasive corruption in the central government and singled out Poroshenko allies for his departure. The resignation of Abromavicius prompted new scrutiny over the fate of the cabinet, which is divided between other foreign-born technocrats and coalition party officials. Yatsenyuk in particular has faced heavy criticism for protecting the interests of oligarchs at the expense of the reforms required to maintain IMF assistance and avoid bankruptcy. On the day of the failed no-confidence vote, Poroshenko also called for the resignation of ally Prosecutor General Viktor Shokin, widely accused of corruption. Poroshenko finally caved to long-standing pressure to dismiss Shokin following the February 15 resignation of reformist Deputy Prosecutor General Vitaly Kasko, who accused Shokin of blocking judicial reforms. Like Poroshenko’s decision to push out Shokin from the judiciary, the president’s support for the no-confidence motion against Yatsenyuk was likely an effort to deflect criticism for failing to combat corruption and promote reform.

The manner in which the no-confidence motion failed raises doubts over the sincerity of Poroshenko’s intent to revise the political status quo, which is guided by oligarch consensus. The motion against the widely unpopular prime minister and his cabinet fell short of a parliamentary majority by 32 votes. Despite Poroshenko’s call for the resignation of the cabinet and the initiation of the motion by the president’s party, 39 MPs from his party were absent, abstained, or otherwise did not participate in the vote. The majority of the pro-Russian “Opposition Bloc,” the successor of the ousted Yanukovych regime’s “Party of Regions,” also walked out on the vote, depriving the no-confidence motion of as many as 33 votes. A total of 41 MPs from the two parties voted the same day to recognize the performance of the cabinet as unsatisfactory but stopped short of supporting the no-confidence motion. Mustafa Nayyem, a prominent reformist MP from Poroshenko’s party and an early supporter of the 2013-2014 “Euromaidan” revolution, accused the president of colluding with rival oligarchs who support the “Opposition Bloc” and Yatsenyuk to stage a failed no-confidence vote.

If Poroshenko did intend to use the failed vote to defuse pressure to overhaul the cabinet and cast himself as a champion of reform, this gamble appears to have backfired. Neither the no-confidence motion nor the dismissal of Shokin from the judiciary resolved the underlying driver of the political crisis. The failed vote of no confidence appears to have instead exacerbated the public and reformist political elite’s mistrust of Poroshenko and Yatsenyuk. Poroshenko, Yatsenyuk, and Ukraine’s other pro-Western leaders will need to make sustained efforts to crack down on corruption and support reform in order to restore this faith. The resignation of Yatsenyuk and a cabinet reshuffle that introduces new technocratic ministers is likely a prerequisite needed to prevent deepening political gridlock from devolving into a new wave of social unrest.

Ukraine’s latest political crisis may escalate in ways that place the survival of the current Western-backed government at risk. Several hundred protestors outside parliament called for Prime Minister Yatsenyuk’s resignation ahead of the failed no-confidence vote, an early warning of the potential for the political status quo to catalyze the population into demonstrations against the government. The demonstrators included supporters of the far-right “Freedom” party, which played a leading role in the August 31, 2015 riot that resulted in three killed and over 100 injured. More dangerously, former Prime Minister Yuliya Tymoshenko is poised to fuel the crisis to reassert herself as a significant powerbroker in Kyiv. Tymoshenko called for snap elections to be held as soon as possible during an early February visit to Washington, D.C., where she met with senior diplomats and congressional leaders. All other party leaders from the former five-party coalition have dismissed snap elections as only a course of last resort given their potential to trigger further instability. Tymoshenko, a historical opportunist with a mercurial relationship with the Kremlin, may find success at the ballots along with the pro-Russian “Opposition Bloc” in the vacuum created by popular dissatisfaction with Poroshenko and Yatsenyuk. A strengthened position in parliament for either Tymoshenko or the “Opposition Bloc” would further cement the already lingering heritage of oligarch-driven politics and restore levers of Russian influence in Kyiv.

Ukraine’s political crisis coincides with escalating offensive operations by Russian-backed separatist forces along the front line in the southeast. Ukraine has come under increasing pressure from its Western backers to fulfill its political concessions tied to the February 2015 “Minsk II” ceasefire agreement despite the continued presence of forward-deployed Russian forces, weaponry, and cyclically escalating indirect fire attacks on Ukrainian positions. These concessions include the constitutional recognition of the “special status” of the occupied southeastern territory, a proposed amendment that lacks support outside Poroshenko and Yatsenyuk’s parties and sparked the August 31 riot. Populist leader Oleh Lyashko, who participated in the riot and defected to the opposition days later, offered to restore the coalition’s majority on February 18. Lyashko conditioned his return to the coalition, however, on the rejection of the “special status” clause in “Minsk II,” a move that Russia would likely meet with further escalation. Russia has deliberately made the fulfillment of the concessions politically untenable for Poroshenko and Yatsenyuk by preserving its offensive posture in southeastern Ukraine. By demanding the concessions in exchange for potential peace, Russia has also led the West to continue prodding Poroshenko and Yatsenyuk into supporting the measures that isolate them from their former coalition allies.

Poroshenko and Yatsenyuk can prevent the political crisis from spilling onto the streets by showing genuine effort to move reforms forward and combat corruption, starting within their own circles. A cabinet reshuffle and a new coalition agreement will also be necessary but not likely sufficient to prevent reforms from stalling further. The preservation of Yatsenyuk as prime minister is likely to obstruct the return of Tymoshenko’s “Fatherland” and the “Self Help” party to the coalition unless they are given significantly expanded decision-making roles. Yatsenyuk would not likely need to resign to form a new coalition with Poroshenko’s party and Oleh Lyashko’s “Radical Party,” however, which have only demanded a cabinet reshuffle. Without the introduction of a truly technocratic cabinet out of Yatsenyuk’s control, such a coalition would nevertheless only harden public mistrust and political dividing lines until a new no-confidence measure can be launched in September.

Despite the collapse of the coalition, a majority of MPs from all three former coalition parties worked with Yatsenyuk and Poroshenko’s parties to pass a key set of anti-corruption bills prescribed by the EU and IMF on February 18. The passage of this legislation offers some hope that Ukraine’s pro-Western leaders can overcome factional divides to support reform, however, they will need to sustain these efforts to earn back the trust of the population. Emotions will be high as Ukraine remembers the roughly 100 killed on Kyiv’s Independence Square (“Maidan Nezalezhnosti) in the final days before Yanukovych’s ousting on February 21, 2014. If post-revolution leaders in Kyiv fail to escape the pull of political recidivism and make persistent efforts to reform, Ukrainians may likewise slide back into a revolutionary mindset to protect the legacy of “Euromaidan.”