Publication: Monitor Volume: 6 Issue: 8

Ukrainian Premier Viktor Yushchenko was given a free hand by President Leonid Kuchma to form his cabinet of ministers, which Yushchenko has promised to be a government of “top professionals.” This should allow him to shape reforms according to his liberal vision. On the other hand, should the promised reforms turn out to be too unpopular, Kuchma could at any moment distance himself from the new government.

The first major appointment to the new cabinet, made on December 25, was that of Yushchenko’s former right-hand man at the National Bank of Ukraine (NBU), its first deputy chair Volodymyr Stelmakh, as the bank’s chairman. Further key appointments showed that Yushchenko’s cabinet will be a compromise between reformist intentions and the demands of party politics. Several posts were given to leaders of the major pro-presidential factions in parliament, whose backing was decisive in Yushchenko’s endorsement as premier and on whose support, as he noted on several occasions, Yushchenko intends to rely. At the same time, professional qualities apparently came first.

Yuri Yekhanurov, one of the leaders of the People’s Democratic Party caucus, is now the first deputy premier responsible for privatization, government administration reform and deregulation of the economy. A moderate reformer, Yekhanurov has extensive experience in related fields, having served as Ukraine’s first State Property Fund chief (in 1994-1997), then as economics minister, and as chairman of the state committee for development of private enterprise. Deputy Premier Mykhaylo Hlady, agriculture minister and deputy premier in the previous government, is to implement Kuchma’s ambitious reform plan in agriculture, in the drafting of which he participated (see the Monitor, December 9). Quite a few eyebrows were raised at the appointment of Yulia Tymoshenko as deputy premier in charge of fuel and energy: As founder of the private company United Energy Systems, she was reportedly the key partner of former Premier Pavlo Lazarenko in his controversial deals in the natural gas market in 1995-1997. At the same time, she is without doubt an expert in the field and has vast experience in negotiating with Russian gas barons. She is the leader of Motherland, a major pro-Kuchma faction in parliament and a party with the same name (which split from Lazarenko’s Hromada after he fled to the United States in the spring of 1999 to avoid investigations for embezzlement). As parliament’s budget committee chair, Tymoshenko bitterly opposed the 2000 budget draft which Valery Pustovoytenko’s government submitted to parliament and which is still not approved; now, with Tymoshenko herself in the government, this opposition will be resolved. Yushchenko has brought into the new government the two most reform-minded members of Pustovoytenko’s cabinet, Ihor Mityukov and Serhy Tyhypko. Mityukov has retained his post as finance minister. Tyhypko, the chief negotiator for Western credit institutions in previous governments, has been demoted from deputy premier to economics minister–in form, but not in essence. In fact, the authority of the new Economics Ministry, which incorporates functions of the former Industrial Policy Ministry, Foreign Trade Ministry and several state committees, has been upgraded–perhaps out of proportion. Tyhypko will head the key ministry and supervise all economic reforms. Serhy Tulub, a successful former coal industry minister, will head the new Fuel and Energy Ministry.

Yushchenko did not touch the power ministries: Defense Minister Oleksandr Kuzmuk, Internal Affairs Minister Yuri Kravchenko, and Emergencies Minister Vasyl Durdynets have retained their posts. Also still in office is the pronouncedly pro-Western Foreign Affairs Minister Borys Tarasyuk.

Should Yushchenko’s government continue to enjoy support from Kuchma and the parliament majority, it should have enough professionalism and authority to implement a free market design, unburdened by populist considerations (New Channel, December 30; UT-1, December 30, January 10; UNIAN, December 31; Kievskie vedomosti, STB TV, January 11).