UKRAINE: JUNE 4 UPDATE - KYIV QUIET AS POLITICAL

C O N F I D E N T I A L SECTION 01 OF 03 KYIV 001354

SIPDIS

SIPDIS

E.O. 12958: DECL: 06/04/2017
TAGS: PGOV PREL UP
SUBJECT: UKRAINE: JUNE 4 UPDATE - KYIV QUIET AS POLITICAL
COMPROMISE MOVES SLOWLY AHEAD

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


1. (SBU) Summary. Actions by key political players June 1-2
gave greater cause for optimism that the political compromise
announced May 27 is being implemented, although public
statements from Prime Minister Yanukovych and Speaker Moroz
on June 3-4 suggested that progress may continue to be slow
and with contentious moments. The Rada finally passed
amendments to the parliamentary election law and the budget,
the latter to finance elections, late June 1. In addition,
the coalition and opposition agreed on a new composition of
the Central Election Commission (CEC)--with the coalition
nominating 8 and the opposition 7 commissioners. Yushchenko
and Yanukovych also agreed on presidential representative in
the Constitutional Court Volodymyr Shapoval as the new
Chairman of the CEC. In addition, the President and PM came
to an agreement over the contested Prosecutor General's
Office (PGO),agreeing to reinstate Medvedko as PG, with
Yushchenko's preferred candidate Shemchuk as the first deputy
in charge of investigations. Our Ukraine and BYuT held party
congresses on June 2 at which they voted to expel all MPs
from the Rada, bringing the Rada one step closer to
dissolution. It is now up to Moroz to announce the
resignations and the CEC to confirm them. However,
Yanukovych, Moroz, and Regions faction leader Bohatyreva
commented on June 3-4 that the coalition would push for the
Rada to continue working for another week, which seemed
contrary to the May 27 deal. Late June 4, Speaker Moroz
expressed doubt that the opposition had 150 "valid"
resignations, noting that the Rada would stay in session
until the situation was resolved. That said, advisers to
both President and PM confirmed with Ambassador that
everything was still on track for a September 30 election.


2. (C) Comment. The most recent comments from Yanukovych,
Moroz, and Bohatyreva are in line with the rhetoric that they
have been using for weeks to spin out the political process.
There are several legal hicccups remaining before the
opposition MPs can truly resign from the Rada and make it
inquorate, but if the political will is there, these
obstables can be overcome. As the events of June 1
demonstrated, the coalition can move forward quickly when it
chooses to do so, rhetorical posturing aside. However, with
September 30 still a long way off, we would not be surprised
to see the coalition continue to fight to keep the Rada in
session through June prior to the traditional July-August
break. End summary and comment.

Rada Finally Passes Needed Bills...
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3. (SBU) After stalling for much of the last week, the Rada
held a June 1 evening session in which they passed amendments
to the election law and to the budget, allowing financing for
elections, as well as seating a new CEC (below). The final
version of the election law included provisions banning
absentee ballots and re-introducing a 50 percent voter
turnout requirement, both of which have raised some eyebrows
(reftel). It also prevents parties from cancelling their
party lists after an election--a clause intended to stop
factions from resigning from the Rada in the future as BYuT
and OU are doing to provide the legal pretext for new
elections (See below for details).

...But Not Ready to go Quietly into the Night
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4. (SBU) However, after the June 4 Consultative Council--the
Rada leadership's weekly Monday meeting--Moroz and faction
coordinator Bohatyreva announced that the Rada would continue
to work this week, echoing comments made by PM Yanukovych in
Odesa June 3. (Note: Yushchenko's most recent decree
extended the authorized window for the Rada to work only
though June 1. End note.) They announced that the Rada would
examine 30 bills submitted by the Cabinet and two by the
President. In addition, they claimed that the opposition had
to prove that their resignations letters were legitimate and
submitted in accordance with established procedures. At a
June 4 press conference, Moroz went further, questioning
whether the opposition had registerd 150 "valid" resignations
with the Rada Secretariat. Moroz claimed that the Rada would
stay in session this issue was resolved "legally." When
asked for comment, OU staffer Svitlana Gumeniuk told us that
Moroz was merely posturing; the only real action remaining
would be by the CEC, not the Rada. OU expected CEC action
within a week; its MPs would attend Rada sessions until the
final decision was taken.


5. (C) Privately, foreign policy advisers for the two Viktors
seemed more positive that the process remained on track.

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Yushchenko adviser Chaliy told Ambassador that he was more
relaxed than he had been in weeks and that the presidential
team was comfortable with where the political compromise had
ended up. PM adviser Gryshchenko told Ambassador that
everyone was a little uncomfortable with the compromise, but
that was a good place to be. Gryshchenko also added that the
election cycle would not start in full until 60 days prior to
the vote--specifying a start date of July 29 for a September
30 election--but that smart people would start preparations
earlier (note: we fully expect Regions and BYuT to be the
most organized political campaigners, as they were in 2006).

CEC Gets Reconstituted
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6. (C) The Rada also voted June 1 on a new slate of CEC
commissioners--after the previous CEC failed to work for much
of the past two months amidst an organized coalition
"sick-out" and charges of politicization on both sides. The
new composition is split 8-7 between coalition and opposition
nominees. The new CEC has eight holdover commissioners from
the previous CEC and one former commissioner who served
through 2004 (and was removed in the previous CEC makeover).
The new Chairman is Volodymyr Shapoval, who most recently
argued Yushchenko's case in the Constitutional Court. His
deputy, Zhana Usenko-Cherna, was originally named to the CEC
by pro-Kuchma party United Ukraine, but was put forward this
time by the opposition; the new Secretary is Tetyana Lukash,
sister of Yanukovych legal eagle and Deputy Minister of the
Cabinet of Ministers Olena Lukash. A USAID implementing
partner who works on election issues commented that with six
"newbies" on the CEC, including Chair and the secretary, the
CEC could face a steep learning curve in the run-up to the
expected September 30 elections. He also said that although
it was too early to say what roles various commissioners
would play, the positioning of Lukash as Secretary was
significant, and gave Yanukovych a direct advocate in the CEC
leadership.

Opposition Resignations Moving Forward
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7. (SBU) After the Rada finished its June 1 votes, OU and
BYuT presented Deputy Speaker Martynyuk, who was presiding,
with 66 OU and 103 BYuT resignations, for a total of 169
resignations (151 were needed to prevent a quorum). On June
2, the two blocs held congresses where they voted to
terminate the mandates of all their MPs. (Note.
Interestingly, BYuT announced that a total of 129 of its MPs
resigned; but in fact, only 103 did so. Another 26 were
expelled for violating faction discipline. OU did not
address the issue of MP's who refused to resign. End note.)
The resignations must now be announced from the Rada
rostrum--which Moroz said he would do June 5 if all the
resignations were "valid"--and approved by the CEC.


8. (C) Comment. Despite the progress, both factions have hit
legal hurdles in the resignation process. Part of the
resignation plan called for the CEC to cancel the two blocs'
2006 election lists, so that the newly emptied seats could
not be backfilled. However, the old CEC ruled that it could
not cancel OU's party list without agreement from OU
constituent Party of Industrialists and Entrepreneurs of
Ukraine (PIEU),headed by current Economy Minister Kinakh.
Agreement from PIEU/Kinakh--who have so far refused to
cooperate--to cancel the list would be a political signal
that the coalition was serious about moving to new elections;
it hasn't happened. Separately, a lawsuit filed by a
low-ranking member (No. 282) of the BYuT list who says he has
the right to be an MP, has slowed the cancellation of the
BYuT list as well. It remains to be seen how the new CEC
will deal with these challenges. Both factions may be able
to avoid this legal snafu by simply continuing to have MPs
resign until the party lists are exhausted, but that would
slow the process down considerably, require the Rada to stay
in session until the process is complete, and continues to
raise some fears that along the way the coalition would
succeed in buying enough of these transitory MPs to keep the
Rada from being dissolved. End comment.

PGO Spat Seems Resolved Too (For Now)
--------------


10. (C) Another June 1 step in the political compromise was
the resolution over the contested PGO. As Tymoshenko
previewed May 30, Yushchenko and Yanukovych agreed to
reinstate previous PG Medvedko as PG and leave Yushchenko's
acting PG Shemchuk in as First Deputy PG, leaving Piskun once
again out of the job. What remains to be seen is how the
"broad coalition" will work inside the increasingly

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disfunctional PGO. Shemchuk has already announced that he
plans to reopen several high-profile cases closed in January
by Medvedko: the April 2005 death of former Interior Minister
Kravchenko--a two gun shot wound to the head ruled a
suicide--and charges of embezzlement and abuse of office
against former Sumy governor Shcherban. Shemchuk also
announced new investigations into the charges that
Constitutional Court Judge Stanik accepted bribes and the
role of Interior Minister Tsushko for the use of force at the
PGO on May 24.

Opposition Election Bloc Seems Dead, Lutsenko Hits Resistance
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11. (SBU) In pre-election developments, People's Self-Defense
Movement (PSD) leader Yuriy Lutsenko announced that talks
were over between OU, his group, and Rukh-Pravtisiya (Union
of Rightist Forces) to form a "megabloc" for the upcoming
elections. In particular, he said that the three elements
had been unable to agree on how to distribute and rank spots
on a joint list and that the others rejected his suggestion
to change the bloc's name to the Union of Democratic Forces,
because, in his words, the brand Our Ukraine had been
discredited. (Note. On the other hand, OU faction leader
Kyrylenko told the press that the talks were continuing and
"95 percent" agreed. End Note.)


12. (SBU) Lutsenko had quietly restarted his regional rallies
in May, which he had suspended in April during the political
crisis and negotiations with OU. At a June 3 rally in
Mykolayiv, a southern province which went strongly "blue" in
2004 and 2006, Lutsenko ran into counter-protests by far
left-wing parties when approximately 30 representatives of
the Communists and Nataliya Vitrenko's Progressive Socialists
tried to block his press conference and provoked a clash with
his supporters. In addition, PSD was denied access to a
local Russian Drama Theater, where it had scheduled a press
event, and one local TV station canceled its interview with
Our Ukraine MP Katerynchuk, a Lutsenko ally, despite a prior
agreement to air the interview.


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