UKRAINE: RADA MAJORITY COALITION TALKS RESUME;

C O N F I D E N T I A L SECTION 01 OF 03 KIEV 001662

SIPDIS

SIPDIS

E.O. 12958: DECL: 04/27/2016
TAGS: PGOV KDEM UP
SUBJECT: UKRAINE: RADA MAJORITY COALITION TALKS RESUME;
SOCIALIST NEGOTIATOR VINSKY'S TAKE ON PROGRESS AND PROSPECTS

REF: A. KIEV 1540


B. KIEV 1081

Classified By: Ambassador, reason 1.4 (b,d)


1. (C) Summary: After a ten-day hiatus, coalition
negotiations between President Yushchenko's Our Ukraine, the
Yuliya Tymoshenko Bloc (BYuT) and the Socialists resumed
April 25, deputy Socialist Party leader Iosyp Vinsky told
Ambassador April 27. Our Ukraine's Roman Zvarych, Tymoshenko
(standing in for her hospitalized deputy Turchynov),and
Vinsky signed two documents: joint instructions to oblast
and local party branches about formation of local coalitions,
and a one-page description of the structure of a national
coalition agreement. The former was required to stop the
uncertainty and hemorrhaging of some local deputies to
"non-democratic" parties, said Vinsky. The latter envisaged
a preamble, a three-part policy section (basic principles of
foreign and domestic policy, tasks for the coalition Cabinet
of Ministers, and issues of disagreement between the three
blocs and how to resolve them),a coalition rules and
regulations section, and a section on division of government
positions. Vinsky characterized the negotiations as complex
and tough, but said they would be completed "if the political
will to reach agreement exists; it all ultimately depends on
one person -- Viktor Yushchenko." The negotiators were
working to hammer out the full coalition agreement in time
for a hoped-for May 17 opening of the new Rada.


2. (C) Vinsky said the biggest obstacle to agreement was the
lack of a clear decision making structure in Our Ukraine,
which he said was not a party but a group of individuals and
interests around President Yushchenko. The Socialists
strongly supported Tymoshenko as Prime Minister because they
believed in the need to launch Ukraine's new
parliamentary-presidential republic with a strong Prime
Minister, and Tymoshenko was now arguably the country's most
popular and dynamic politician; she had earned the right to
lead. Ambassador underscored U.S. support for the formation
of a reform-oriented Orange coalition, and the need for the
parties involved to come to agreement, particularly on the
details necessary to form a lasting, effective coalition.
Comment: Vinsky's comments on the red-line issues identified
by Yushchenko (NATO, land privatization, and privatization)
confirm that deep policy differences remain, particularly
between Our Ukraine and the Socialists. It is interesting as
well that the Socialists continue to meet with Tymoshenko to
agree on common positions before engaging Our Ukraine. It is
welcome news that serious discussions have resumed. End
summary and comment.

Slippage in a vacuum before getting back to work
-------------- ---


3. (SBU) Negotiators for the proposed "Coalition of
Democratic Forces" (the "pink" Socialists asked that it not
be called an Orange coalition) had not met since signing the
protocol of intent to form a coalition April 13, and the
subsequent partial rejection of the protocol by the Our
Ukraine party April 14 (ref A). In the interim, speculation
built about Our Ukraine's true intentions, particularly after
Our Ukraine paired with Party of Regions to announce a
majority in the Zakarpattya Oblast Council, worked with
Regions in a failed attempt to block the Tymoshenko bloc's
nominee to become head of the Kiev Oblast Council, and
backed out of announced plans to partner with BYuT and the
Socialists in Chernivtsi and Vinnytsya oblast councils.

Joint instruction to local branches
--------------


4. (C) Tymoshenko, Vinsky, and Zvarych resumed so-called
"working group" meetings April 25 after the conclusion of the
Orthodox Easter holidays, as promised by Our Ukraine Chair
Roman Zvarych April 20. The Socialists in particular were
concerned about developments in the provinces the previous
two weeks, since uncertainty about the fate of the national
coalition discussions had allowed "opposition" parties,
particularly the Lytvyn bloc and Regions, to start poaching
Socialists elected to district/local councils; the problem
was particularly acute in Kirovohrad and Vinnytsya, said
Vinsky.


5. (C) Vinsky confirmed press reports that he and his
Tymoshenko and Our Ukraine bloc counterparts in the latest
talks had signed a joint instruction to provincial/local
party branches about forming local alliances between the
three parties. He acknowledged that it would be impossible
to undo all the damage from the past several weeks, but said
that sending a clear signal of intent was important to
stabilize the situation and move forward. Vinsky would meet

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with 800 local Socialist leaders May 1 to deliver the message
in person; the bigger issue was whether Our Ukraine would
take action. He claimed that certain Our Ukraine provincial
factions controlled by Petro Poroshenko, such as in Vinnytsya
and Zhytomyr, would likely not cooperate with BYuT and would
continue to seek alliances with Regions and Lytvyn's bloc,
the latter of which did not make it into the national Rada
but did win seats in provincial and local councils.

Agreed structure for coalition agreement
--------------


6. (C) The second achievement of the April 25 coalition talks
was an unpublicized, signed one-page framework of a coalition
agreement. The outline stipulated that the coalition
agreement would include a preamble; a three-part policy
section (basic principles of foreign and domestic policy,
specific tasks for the coalition Cabinet of Ministers, and
issues of disagreement between the three blocs); a rules and
regulations section; and a section on division of government
positions. Vinsky characterized the Rules section as "80%
complete," adding that once Tymoshenko came up to speed after
taking over from her deputy Turchynov (hospitalized with
hepatitis, also dodging an arrest warrant for allegedly
authorizing destruction of SBU files),that section could be
finished relatively quickly. Vinsky would meet Tymoshenko
later April 27 to reach agreement on the Rules section, since
two-way sessions were more productive than three-way
negotiations.


7. (C) The policy section was also "80% complete in technical
terms," since the three parties had agreed that the basis
would be Yushchenko's "Ten Steps for the People" campaign
platform, the proposals Yushchenko as President had submitted
to the Rada, and the program of the Tymoshenko government
that had been passed by the Rada. On substantive terms,
Vinsky allowed that the parties were only "50% in agreement,"
since major issues remained to be addressed, and both Our
Ukraine and BYuT had proposed "adjustments." The
"disagreement" section would list the major issues on which
the parties differed; the parties then needed to find a
formula to unite behind a position, form a compromise, put
the issue aside, or otherwise agree how to address it.
Vinsky stated that agreeing on policy and rules regulating
coalition formation was not just an issue of "boxing in"
Tymoshenko; it was also about creating the basis of stable
governance with checks and balances that Ukraine needed,
including a role for the opposition.

Hoping to finish before the new Rada meets
--------------


8. (C) The negotiating process was very complicated,
acknowledged Vinsky, but if the political will to seal the
deal were there, the talks would succeed; it all depended on
Yushchenko. The negotiators had set themselves a target of
finishing the coalition document in time to send it to
various party/bloc political councils for review/approval;
the hope was to have it ready to sign on the first day of the
new Rada. Vinsky claimed that since the Rada rules mandated
a minimum of 20 days after the promulgation of official
election results prior to the opening of the next Rada, the
earliest possibly opening date was now May 17. (Note: After
court delays brought by legal challenges to the March 26
election results, the official results were officially
published in the April 27 editions of the government's and
the Rada's official newspapers.) The Socialists were pushing
Our Ukraine to open the Rada and form a government as soon as
possible, because the country and democratic forces were the
losers the longer the process of government formation lasted.
Vinsky acknowledged that an influential group within Our
Ukraine sought to delay the process as long as possible.

Dealing with Our Ukraine, Tymoshenko, not Regions
-------------- --------------


9. (C) The biggest obstacle to forward progress, claimed
Vinsky, was the decision making structure in Our Ukraine.
While Vinsky and Tymoshenko were fully empowered to make all
decisions for their blocs/parties, Roman Bezsmertny and
Zvarych had no such mandate. Even though the two Romans were
in favor of the coalition, they knew they negotiated with
second-guessers (comment: or worse, saboteurs) behind their
back within Our Ukraine. Vinsky scoffed at characterizing
Our Ukraine as a party, stating that it could better be
called a group of individuals and interests clustered around
Yushchenko.


10. (C) Vinsky declined to characterize either Yushchenko or
Tymoshenko as a true democrat, adding that Yushchenko aspired
instead to be the "good tsar." Yushchenko's handling of his

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family, his entourage, and his Sumy clique supported this
assessment, Vinsky asserted. Vinsky claimed he had raised
the matter with Yushchenko directly in early 2005, telling
him, "If you are a democrat, then act like one, and choose
people who will lead the country democratically, not the
people who ran the campaign" (i.e., Poroshenko, Zhvaniya,
Chervonenko, etc.). An infuriated Yushchenko did not respond
and had not talked to him since, Vinsky said.


11. (C) The Socialists strongly supported Tymoshenko's claim
to be Premier, stated Vinsky, because only she could be a
real leader of a democratic coalition with the strong support
of the Ukrainian people. Still, since her own commitment to
cooperative approaches to governing was in question, it was
important to come up with legal mechanisms and personnel
agreements to curtail any concentration of power. However,
in the new parliamentary-presidential republic which Ukraine
had become since constitutional reform came into effect,
Ukraine could not afford to have a weak politician or a
technocrat as PM. Vinsky claimed that Tymoshenko's current
popularity was likely over 30%, even greater than
Yanukovych's; she might make mistakes, but she was the one to
lead Ukraine's government at this time. He had told
Bezsmertny and Zvarych, "Look, either embrace her as PM now
or watch her go into opposition and become President in 2009."


12. (C) The Socialists did not want to deal with Yanukovych
and Regions -- even though their social policies coincided
more closely than with those of Our Ukraine and BYuT, said
Vinsky -- because Regions represented "Asia,"
authoritarianism, and Kuchmaism, all the things that the
Socialists fought against. When the Socialists had backed
Yushchenko in 2004, they had lost half their previous voter
base and many local leaders, particularly in eastern Ukraine,
but they had reconciled themselves to their six-percent base
and were proud of their principles.

Still disagreement on NATO, land, privatization
-------------- --


13. (C) Vinsky's characterizations of Socialist positions on
the red-line issues identified by Yushchenko as important to
resolve -- NATO, land, and privatization/reprivatization --
indicated clear policy differences remain to be bridged (ref
B). On NATO, an issue that Vinsky noted was not included in
Yushchenko's campaign policy platform, the Socialists were
for full cooperation but believed that membership was not for
the President or the parties to decide; it was for the people
of Ukraine via referendum.


14. (C) On land privatization, the Socialists would support
sales of land as a normal form of property, with the notable
exclusion of agricultural land, which Vinsky said comprised
roughly 50% of Ukraine. There needed to be greater
definition and clarity on the principles and procedures
involved, a fundamental overhaul of agricultural sector
policy, plus restrictions to ensure that speculators did not
simply drive the process to the exclusion of farmers, before
moving forward.


15. (C) On privatization, the Socialists could support
privatization of enterprises but not of infrastructure or
monopolies that served the people, since a monopoly in the
hands of a rapacious businessman would be no better run than
a state monopoly. Under this rationale, the Socialists
opposed privatization of UkrTeleKom. However, the Socialists
were also against monopolies; the way forward was to open up
the sector, grant additional licenses, and let market
competition improve service and quality.


16. (U) Visit Embassy Kiev's classified website at
www.state.sgov.gov/p/eur/kiev.
Herbst