Publication: Monitor Volume: 3 Issue: 165

On a trouble-shooting visit to the city of Dnipropetrovsk, Ukrainian prime minister Valery Pustovoytenko told a meeting of the regional administration’s senior staff that "a criminal economic elite has formed and entrenched itself in Dnipropetrovsk region, and is striving for power… That elite seeks, not without success, institutional protection of its shadowy interests." Pustovoytenko called for a "review of abuses of power, violation of the law, and economic machinations in the region." The Ukrainian prime minister targeted particularly the United Energy Systems (UES) company for colluding with state officials, grabbing the lion’s share of Ukraine’s fuel imports and metallurgical exports, manipulating prices, and evading taxes on its windfall profits. He indicated that UES had extended its influence far beyond Dnipropetrovsk into Donetsk, Luhansk, Zaporizha, and Kirovohrad regions.

Ukraine’s recently dismissed prime minister, Pavlo Lazarenko, and his business and political associates are closely linked to United Energy Systems. A top UES executive, Yulia Timoshenko, is also playing a leading role in the Hromada party, which has recently been formed by Lazarenko’s supporters with an eye to the upcoming parliamentary elections. Lazarenko, meanwhile, has assumed official leadership of the 20-strong Yednist [Unity] parliamentary group, comprised of state officials and industrial executives long associated with him. The presidential administration, however, promptly encouraged some Yednist deputies to leave the group. (UNIAN, Eastern Economist Daily, September 5; The Rukh Insider, No. 8, September 4-10)

Lazarenko is a leading figure of the "Dnipropetrovsk clan," a description that, indeed, also fits President Leonid Kuchma, Pustovoytenko himself, and other senior officials in Kyiv. The recent ouster of Lazarenko after barely only one year as Prime Minister, and now Pustovoytenko’s attack, highlight the fragmentation of that "clan," and illustrate the presidential team’s resolve to combat at least some aspects of official corruption.

Kuchma Unfazed by Impeachment Move.