PRESIDENTIAL SECRETARIAT CHIEF QUITS, DENOUNCES

C O N F I D E N T I A L SECTION 01 OF 02 KYIV 000864 SIPDIS E.O. 12958: DECL: 07/04/2019 TAGS: PGOV PREL UP SUBJECT: PRESIDENTIAL SECRETARIAT CHIEF QUITS, DENOUNCES YUSHCHENKO Classified By: Ambassador William Taylor for reasons 1.4(b,d) SUMMARY -------------- ¶1. (C) Presidential Secretariat head Viktor Baloha, famous for vitriolic condemnations of PM Tymoshenko which included charges of treason, announced his resignation on May 16. On May 19 Baloha turned his attacks on President Yushchenko, saying he had betrayed the promises of the Orange Revolution and had no "moral right" to seek a second term. Yushchenko appointed Kyiv region Governor Vera Ulyanchenko, a longtime ally, on May 20 to replace Baloha. This garnered approval across party lines. Ulyanchenko's calmer style stands in stark contrast to Baloha's and has the potential to improve, at least in tone, Yushchenko's relationship with Tymoshenko. Baloha has not departed from the political scene. He retains influence over the ten member United Center group in the Rada and many regional governors. His connections and economic resources make him an attractive potential partner for such forces as the opposition Party of Regions. That said, Baloha has many powerful enemies and is the target of corruption allegations. His influence may wane now that he is removed from the Presidential orbit. End Summary. BALOHA RESIGNS, ATTACKS YUSHCHENKO -------------- ¶2. (U) Presidential Secretariat head Viktor Baloha announced his resignation on May 16 and, in a statement released to the press on May 19, attacked President Yushchenko. Baloha gave three reasons for his resignation. First, Baloha said he disagrees with Yushchenko's decision to seek a second term. He said that the president has no "moral right" to run again because he has not implemented the systemic reforms he promised during the Orange Revolution. Second, he claimed that Yushchenko tolerates corruption and nepotism in his inner circle. Finally, he blamed Yushchenko for engineering a constant stream of crisis and political conflict in Ukraine. BALOHA SAYS HE QUIT, WAS NOT PUSHED -------------- ¶3. (U) In a May 21 press conference Baloha did not further criticize Yushchenko and emphasized that he was still willing to work with the president and other political parties. Baloha emphasized that he personally made the decision to resign and that Yushchenko repeatedly asked him to reconsider. He said that while Presidential Secretariat 
head he was a loyal member of Yushchenko,s team and that all his actions, including the vitriolic attacks on Tymoshenko, were authorized and directed by the President. Despite his earlier criticism of Tymoshenko, however, Baloha did not rule out that he could find common ground with her in the future. YUSHCHENKO APPOINTS LONG-TIME ALLY -------------- ¶3. (U) Yushchenko, who has thus far remained silent on Baloha's accusations, on May 20 appointed Kyiv region Governor Vera Ulyanchenko as the new head of the Presidential Secretariat. Ulyanchenko, prior to her appointment as Governor in 2006, served on Yushchenko's staff while he was Prime Minister from 2000-2002, as his Chief of Staff for the 2004 presidential race, and a principal advisor following his election. Ulyanchenko also served as a Rada MP from Yushchenko's Our Ukraine party until becoming Governor. While serving as an advisor to Yushchenko, analysts described her as the President's gate-keeper and confidant. Ulyanchenko was also elected on May 16, before the announcement of Baloha's resignation, as the head of Our Ukraine party's political council in an effort to reunify and revitalize the party. POSITIVE REACTION TO ULYANCHENKO'S APPOINTMENT -------------- - ¶4. (U) Politicians across the political spectrum have welcomed Ulyanchenko's appointment. Opposition Party of Regions deputy faction leader Hanna Herman applauded Ulyanchenko's appointment and described her as a capable manager able to broker compromises between political forces. Prime Minister Tymoshenko bloc (BYuT) MP and deputy Rada speaker Mykola Tomenko said that Ulyanchenko will be a positive force in the president's office and is someone who favors cooperation over confrontation. Our Ukraine-People's KYIV 00000864 002 OF 002 Self Defense bloc (OU-PSD) pro-presidential MP Kseniya Lyapina said Ulyanchenko is an effective organizer able to take on big challenges. POTENTIAL FOR IMPROVED YUSHCHENKO-TYMOSHENKO RELATIONSHIP? -------------- -------------- ¶5. (C) Ulyanchenko's appointment could also lead to an easing in the conflict between Yushchenko and Prime Minister Tymoshenko. OU-PSD deputy faction leader and pro-coalition MP Ruslan Knyazevych said that Ulyanchenko could act as a mediator between Yushchenko and Tymoshenko. BYuT MP Serhiy Sobolyev told us that Ulyanchenko's appointment points to a potential softening of the war between the President and PM. He said the appointment may signal Yushchenko's willingness to improve cooperation with Tymoshenko. BYuT MP Konstantin Bondaryev told us that although Yushchenko and Tymoshenko's rivalry will continue, he hoped that at least the "dirty tricks war" orchestrated by Baloha would end. BALOHA STILL A VALUABLE COMMODITY -------------- ¶6. (C) Baloha's break with Yushchenko leaves him a potentially valuable free agent, according to BYuT MP Valeriy Pysarenko. He told us that with influence over ten Rada MPs, many regional governors, and with economic resources at his disposal, Baloha could be a valuable addition to another political party. Pysarenko said that despite the animosity between Baloha and Tymoshenko, BYuT might even seek Baloha's cooperation. Regions deputy faction leader Volodomyr Makeyenko told us that it would be "natural" for Baloha to cooperate or join Regions. He said that one of the main themes of Baloha's tenure as Presidential Secretariat head was his effort to convince Yushchenko to cooperate more closely with Regions. Makeyenko said that Baloha has close contact with most Regions leadership and Baloha's animosity to Tymoshenko would push him to back Regions head Yanukovych in the upcoming presidential election. COMMENT -------------- ¶7. (C) The antagonism between Yushchenko and Tymoshenko extends far beyond Baloha, but his departure could at least improve the tone of relations. We expect Baloha to use his influence and political connections to remain a political player. His inside knowledge of the Yushchenko administration and experience in attacking Tymoshenko would make him especially attractive to the Party of Regions in the upcoming presidential election. That said, Baloha has many enemies and is the target of corruption allegations. Now removed from the Presidential orbit, his political pull could well diminish. TAYLOR