UKRAINE: ELECTION DATE HOLDING UP COMPROMISE

C O N F I D E N T I A L SECTION 01 OF 04 KYIV 001088

SIPDIS

SIPDIS

E.O. 12958: DECL: 05/08/2017
TAGS: PGOV PREL UP
SUBJECT: UKRAINE: ELECTION DATE HOLDING UP COMPROMISE


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Classified By: Ambassador for reasons 1.4(a,b,d).


1. (C) Summary. Negotiations may be almost complete on the
"small package" of laws considered necessary to resolve
Ukraine's six-week political crisis, but continued wrangling
over whether the elections should be held in the summer or
fall have slowed the pace of compromise. The working group
named May 4 by President Yushchenko and Prime Minister
Yanukovych to finalize the details of the political
compromise was originally scheduled to complete its task by
May 7, according to the President at his May 4 press
conference, in order to present the agreement to the Rada for
a vote on May 8. After the two sides held separate working
group meetings and coalition leaders grandstanded at public
hearings on new elections on the morning of May 7, the
working group reconvened that evening, but was unable to
reach a final agreement. National Security and Defense
Secretary Haiduk confirmed to the Ambassador May 8 that he

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had been meeting quietly with Regions financier Akhmetov, his
former business partner, and it was agreed that big business
wanted the situation resolved quickly. Negotiators for the
President have reported that the group had finished almost
all its work, but both sides signaled that there remained a
key disagreement over when the elections should take place.


2. (C) Comment. The key question on everyone's mind is why
Yanukovych finally agreed to new elections, with several
explanations most likely factoring into the equation. The
first is that Yushchenko and Presidential Chief of Staff
Baloha may have offered Yanukovych, assuming Regions wins a
plurality again as expected, the first opportunity to form a
new government, possibly even offering him support to be PM
again. Haiduk's comments would suggest that Akhmetov and the
business wing of Regions may also have been pressuring the PM
to resolve the political standoff before it led to economic
complications. Finally, Haiduk and political observers from
several political camps expressed the view that Yushchenko's
decision to fire two Constitutional Court Judges on April 30
and May 1 was enough to throw the outcome of the Court case
on dismissing the Rada into doubt and convince Yanukovych he
was better off cutting a deal. The PM's unexpected decision
to leave the country on May 8--he flew to Spain for knee
surgery and has not announced a return date--suggested that
he is trying to drag out negotiations in hopes of gaining a
better deal in terms of an election date. Suggestions by
coalition MPs that constitutional and legal activity
pertinent to the election will take several months also seems
to be a negotiation tactic to strengthen their hand. End
summary and comment.

Negotiations Nearing Completion, but Stalled
--------------


3. (SBU) First Deputy Head of the Presidential Secretariat
Vasyunyk told the press that Yushchenko's plan was to suspend
the part of his April 26 decree that terminated the Rada's
powers immediately upon conclusion of an agreement on a date
for early elections. This would allow the Rada to return to
work and pass a "small packet" of legislation being put
together by the working group. Vasyunyk said Yushchenko
would do this to ensure that all Rada decisions going forward
are seen as "legitimate". Vasyunyk also said that they were
80-85 percent done with the legislative packet and he thought
they could be finished by May 10, the deadline that
Yushchenko has given for the working group to finish. If
they do not meet the deadline, according to Vasyunyk, the
President will "make appropriate decisions."


4. (SBU) Despite Yushchenko's announcement on May 4 that the
working group would be finished with the legislative package
by Monday May 7, disputes have centered around when the
election would happen. In addition, public posturing by all
participants to gain negotiation leverage had slowed the pace
of progress. Tymoshenko's second-in-command Turchynov told
the press that Communist representative at the talks, First
Deputy Rada Speaker Martynyuk, was being especially
obstructionist and Regions was trying to use this to its
advantage. He also called for the Communists and Socialists
to be expelled from negotiations. Turchynov speculated in the
press that Regions was okay with their coalition partners'
intransigence because it bought time for them to push their
agenda, namely pushing the date of the election to the fall.

Haiduk: Compromise Will Be Soon, Big Business Wants a Deal
-------------- --------------


5. (C) During a May 8 meeting with the Ambassador, NSDC
Secretary Haiduk was upbeat that a final agreement between

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the President and PM would be achieved "within a day or two,"
referring to Communist and Socialist party objections and
public statements as pre-election campaign posturing. He

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said that this agreement would include both a date for early
elections and a package of the legislative actions that would
be taken by the current Rada. With regard to a date, Haiduk
acknowledged that the two sides were still talking about
different time frames--the opposition was pushing for July
and the government for the fall. On legislative actions,
Haiduk noted that that Yushchenko wanted a number of laws to
be adopted. However, the President was willing to put some
aside (e.g. amendments to the CabMin law and adoption of
legislation containing the key provisions of the Universal)
and concentrate on a "small package" that would include only
legislation needed to hold pre-term elections. Specifically
this package would include amendments to the Law on Elections
(to configure the law with the declared timeframe for the
elections),the Law on Rada Deputies (to deal with imperative
mandate),and the Law on the State Budget (to ensure
financing for pre-term elections). Haiduk acknowledged that
adoption of the "small package" would not fix the fundamental
contradictions/gaps in the constitution, but expressed hope
that the next government would take action to correct these.
Yushchenko reiterated the same position on "large" vs.
"small" packages in a May 8 speech in Vinnitsya--he would
rather have the former, but could live with the latter.


6. (C) Although downplaying his role in ongoing
negotiations, Haiduk confirmed to the Ambassador that he has
been meeting quietly with Regions financier Rinat Akhmetov to
bridge the gap between the President and PM teams. (Note:
Akhmetov and Haiduk were business partners in Donetsk until
2002-2003, when they split their interests into two
companies. It appears that a Haiduk-Akhmetov meeting may
have set the stage for the May 4 Yushchenko-Yanukovych
announcement of a deal in principle on early elections. End
Note.) Haiduk acknowledged that Ukrainian big business was
eager to get this crisis behind them and that all they wanted
were clear established rules so that they could use their
brains to make money; they did not want to have to wonder
each day whether the President and the Prime Minister were
"in a good mood." Haiduk denied rumors that there were
ongoing discussions about a possible presidential decision to
impose a state of emergency, acknowledging that there were
radicals within the opposition who wanted "everything all at
once" but flatly stating that this was not under
consideration. He said that he and DPM Radchenko (in charge
of the law enforcement and security portfolios at CabMin)
continued to work together to ensure continued coordination
in responding to street demonstrations and protests.

Election Date is Sticking Point
--------------


7. (SBU) Yanukovych and Regions faction leader Bohatyreva
stated publicly May 7 and 8 that the fall was a better time
to hold the new election. Bohatyreva argued that
constitutional changes were necessary and that late
October/early November would be the optimal time for new
elections. She also said that the coalition favored
finishing the new voter registry, which would not be done
until October. (Note. The Cabinet allocated UAH 127 million
for the new voter registry on May 3. End note.) Regions MP
German suggested October 14 in the press and another Regions
MP, Yuriy Miroshnychenko told us that the fall was best.
BYuT MP Vydrin told us that also he thought fall was the most
likely, but no later than October 14, he explained, because
Regions needed to get the election done before heating season
begins in Ukraine (October 15),in case there are problems
with it.


8. (SBU) Opposition negotiators insisted that mid-July was
the latest elections could take place. OU leader Kyrylenko
and Turchynov said the opposition will accept a new vote no
later than July 8 and would hold the election without
coalition participation if need be. Without issuing a
similar ultimatum, Yushchenko said in his May 8 Vinnitsya
speech that there was no need to prolong the political crisis
for another seven or eight months, when the elections could
easily be held in July.

Stalling for Time?
--------------


9. (C) In a surprising move, immediately after meeting with
Yushchenko, Yanukovych flew to Spain on May 8 for surgery on
his knee. This trip removes him from direct participation in
negotiations and could be an effort to drag out negotiations
and part of an effort to push the elections to the fall.
Press reports said he might return on May 9 or 10, but the
CabMin said it could not confirm a return date.

What Did Yanukovych Get?
--------------

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10. (C) One of the key points of speculation has been what
Yanukovych personally and Regions in general got for agreeing
to new parliamentary elections. One of the most
commonly-voiced guesses is that the PM was given an assurance
from Yushchenko that Regions would get the first chance to
form the new government after the elections -- or perhaps
even a promise that Yanukovych would be named Prime Minister
again. Chaliy told Ambassador that part of the May 4
agreement was that first political force past the post would
have first opportunity to form government and that a broad
coalition was very possible, although he did not specify who
would be in the coalition. Segodnya, a newspaper owned by
Regions financier Akhmetov, on May 5 quoted a Regions source
as saying that Yushchenko "promised too much" to the PM, and
may have agreed to form a Regions-OU coalition after the
election with Yanukovych as PM.


12. (C) Haiduk and Ukrainska Pravda journalist Serhiy
Leshchenko told us privately, and Mykhayklo Pohrebinskiy a
political analysts associated with Viktor Medvedchuk and
SDPU(O),echoed publicly, that they believed that Yanukovych
capitulated because Yushchenko fired Constitutional Court
Judges Stanik and Pshenychniy. In their view, once
Yanukovych began to doubt that the Court would have enough
votes to rule against the President's decree, he decided to
cut a political deal.

Rada Still Operating at Half Capacity
--------------


13. (SBU) Just as Moroz had promised, the Rada opened on May
8 -- and the opposition stayed away. (Note. Although 262
MPs were registered in the hall, there were clearly quite a
few Regions MPs missing too). While comments from the floor
were mostly related to upcoming Victory Day issues, comments
in the halls suggested that MPs are focused on the working
group, although they did not always seemed informed about
progress.


14. (C) Regions firebrand MP Miroshnychenko told us May 8
that Yushchenko and Yanukovych had made a strategic
decision--to hold new elections--and sent a signal to the
Rada, but it was the parliament that needed to work out all
the details of the compromise. There were two points left in
the working group's negotiations--the date of the elections
and the legal basis for the elections. In terms of the
latter, the Rada coalition was proposing two changes to
Article 90 in the constitution--to allow the Rada to vote
dismiss itself and to make a lack of quorum (although he did
not specify for how long) an automatic reason for dismissal
of the Rada. Socialist faction leader Bokiy echoed the need
for constitutional changes before holding an election, which
would require two Rada votes in two sessions, meaning the
earliest an election could be held would be early October.
Miroshnychenko said that there has been no discussion of the
Socialists joining Regions' list in a new election. (Embassy
Note. An agreement that required a constitutional change
would clearly drag on for months, and ensure that pre-term
elections did not happen any time soon. End Note.)

Right Facing Problems in Forming Bloc
--------------


15. (C) The right and right-center, reform-oriented parties
are still trying to form an election bloc, but progress has
stalled as major figures argue over positions on the election
list. Eight-sided talks were conducted May 7 between Our
Ukraine constituent parties--People's Union Our Ukraine,
Christian Democratic Union, and Congress of Ukrainian
Nationalists--Forward Ukraine, the party affiliated with
Lutsenko's People's Self-Defense Movement, the new Ukrainska
Pravytsia--Rukh, the Ukrainian People's Party, and Sobor--and
the youth party Pora. Disagreements remained however, as
People's Self-Defense and Ukrainska Pravytsia each demanded
30 percent of spots on the list and OU resisted the proposal.
This has been the struggle for several weeks now as all
parties say they want cooperation and unity, but OU has not
wanted to give enough positions to other parties to satisfy
them.


16. (C) In addition, distrust over rumors about the deal are
exacerbating problems within Yushchenko's camp. Lutsenko
demanded publicly on May 8 that leaders of OU and BYuT sign a
written agreement that there will not be a broad coalition
with Regions after the elections. (Comment: Not only will a
partnership with Regions be difficult for Lutsenko and
Tarasyuk on an ideological level, but the personal nature of
the attacks by the current coalition against these two former
Yushchenko ministers will make broad cooperation a hard sell
and could undermine any deal that Yushchenko and Yanukovych

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have made, although this all would not unravel until after
the elections. End comment.)


17. (U) Visit Embassy KYIV's classified website:
www.state.sgov.gov/p/eur/kiev.
Taylor