Ukrainian Weekly Highlights February 15 – 21, 2016

Ukrainian Weekly Highlights February 15 – 21, 2016 from Digests & Analytics Ukraine

Parliamentary coalition has almost collapsed - The resignation of the Government was failed by the Verkhovna Rada - The "visa-free" laws with a double bottom - General Prosecutor Shokin resigned - Minsk process is stalled - Transit War abated - The second anniversary of the shooting at the Maidan - Hryvnia rate continues to fall - Russia demands to return the "Yanukovych's debt" - A police officer who killed the passenger of the persecuted car, was detained - The United States insist on the transition of the army to the NATO standards - Turkey and Ukraine share a common enemy

No one can say whether the parliamentary coalition exists

The ruling coalition in the Verkhovna Rada, after the failed attempt to dismiss Prime Minister Yatsenyuk, is confidently moving towards own collapse. President Poroshenko held consultations with leaders of the parliamentary factions and deputies of his Bloc. Head of the "Batkivshchyna" party Tymoshenko announced about their intention to withdraw from the ruling coalition and to start the process of the early parliamentary elections. In her opinion, it is necessary to change the format of the coalition, and to appoint a new Prime Minister. Head of the “Samopomich” faction Berezyuk reported that MPs of his faction will not attend the plenary sessions of the Verkhovna Rada due to the loss of control over the Government by the Parliament. The "People's Front" faction  protests against the  populist attempts to shatter the political situation in the country, and offers to sign an annex to the coalition agreement, and continue to move along the path of the reforms. Prime Minister Yatsenyuk said that the political crisis in the country was created artificially for the purpose of the early elections. Poroshenko, during the meeting with the deputies of his faction, said that Prime Minister Yatsenyuk should leave his post within three months. Head of the Poroshenko Bloc faction Lutsenko said that the faction is still in the coalition, but requires the replacement of some the ministers in the Government. Head of the "Batkivschyna" faction in the Verkhovna Rada Tymoshenko announced about withdrawal of 19 deputies from the coalition.

The “Samopomich” faction has decided to withdraw from the coalition following the "Batkivschyna” faction. Prime Minister Yatsenyuk announced the start of consultations on the establishment of a new coalition with the Poroshenko Bloc, the People’s Front and the Radical Party.

Prime Minister Yatsenyuk claims that a formal coalition in the Parliament continues to exist until the Head of the Verkhovna Rada announces different, despite the statements of the factions of the Radical Party, Batkivschyna and Samopomich about the withdrawal from coalition. According to him, the return of the Radical Party will allow to sign a new coalition agreement and approve a new action plan. Poroshenko Bloc said they are not going to leave the coalition and require the reformatting of the Cabinet.

Most experts believe that the early parliamentary elections are becoming a reality, but their holding under existing law will not allow to change the balance of power and will not let the President to obtain a complete control over the Parliament and the Government. Thus, Poroshenko will be stretching time as long as possible, keeping the Parliament up in the air, since the dismissal of the Parliament in connection with the collapse of the coalition is his right, and not an obligation.

Verkhovna Rada failed the Government's resignation

The Government reported to Parliament on the results of its activities during the previous period. The deputies by the majority vote recognized the work of the Cabinet unsatisfactory, however, a vote of non confidence to the Government ended without results. Thus, the Government will continue its work at least until September 2016.

According to the majority of Ukrainian and international experts, the address by President Poroshenko and voting in the Verkhovna Rada were a spectacle with the purpose to show to the West that the changes are taking place in Ukraine and to provide a basis for granting of the next tranche of the IMF loan. Even the deputies of the factions, which initiated the non-confidence vote, did not vote for the resignation of the Government, which may indicate a consensus within the oligarchic groups that control a significant part of the Parliament, the President and the Prime Minister.

Head of the Poroshenko Bloc faction Lutsenko said that Prime Minister Yatsenyuk has three weeks to reformat the Cabinet of Ministers. Yatsenyuk believes that the Verkhovna Rada did not to dismiss the Cabinet, because it would cause "chaos, destabilization and early parliamentary elections." The observers called Head of the Presidential Administration Lozhkin one of the candidates for the post of the first deputy prime minister. By all indications, President Poroshenko can not go against the conditions set by the Western partners, who have repeatedly stated that they are satisfied with the Government headed by Yatsenyuk.

"Visa-free laws" with a "double bottom"

The Verkhovna Rada adopted the law on the electronic declaration of incomes of officials and members of their families, taking into account the amendments introduced during the seating by one of the deputies of the Poroshenko Bloc faction, which completely negate the proposed anti-corruption standards. According to Tombinsky - the Head of the EU Delegation in Ukraine - Ukrainian authorities are not interested in fighting the corruption, so after eight months since the establishment, the National Agency for prevention of corruption has not yet started to work, and the adopted law does not give reason to expect the obtaining of a visa-free regime. The laws on "Special Confiscation" and amendments to the Law on the Prosecutor's Office, according to which the right to appoint an anti-corruption prosecutor was granted to the General Prosecutor, were adopted. The deputies also voted for the extension of the powers of the Agency on search and use of the corrupt assets, giving it the right to control, use and dispose of these assets until the delivery of judgment.

According to some analysts, the "anti-corruption" laws adopted by the Verkhovna Rada, include great risks associated with the additional powers, granted to the law enforcement authorities, and the process of the provision of a visa-free regime to Ukraine may be delayed for an indefinite period without a decision on electronic declaration of incomes of officials and members of their families, starting from 2016.

The resignation of the General Prosecutor

Deputy general prosecutor Kasko resigned. He explained his decision, saying that the corruption and mutual responsibility reign in the GPU and more and more people of former General Prosecutor Pshonka take up the key positions , and attempts to change the situation are immediately and revealingly prosecuted. The Press service of the General Prosecutor’s Office called such statement of Kasko a PR action. The observers consider his resignation a serious damage to the image of Ukraine, once again demonstrating the refusal of the authorities to carry out reforms.

President Poroshenko proposed a full renewal of the Government together with the dismissal of the General Prosecutor. Shokin handed in a statement on resignation, but the General Prosecutor's Office said that at this time he is on vacation. The resignation of the General Prosecutor does not indicate an attempt to change the system, because, according to law enforcement officials and human rights activists, his duties for an indefinite period will fulfill his current deputy - Sevruk, who is fully controlled by the President and his Administration.

On Friday, the Verkhovna Rada got the proposal on dismissal of Shokin, which was demanded by the Western partners of Ukraine. US Ambassador Pyatt expressed his satisfaction with this step of the President .

The second anniversary of the shooting at the Maidan

In Kiev took place events dedicated to the second anniversary of the shooting at the Maidan activists. People came to remember those killed to the alley of the Heavenly Hundred. In the morning, President Poroshenko  laid a wreath, and then participated in a joint prayer service in the Mikhailovsky monastery with the relatives of those killed  The event was guarded by several hundred soldiers of the National Guard Special Forces. During the day, the members of the  volunteer units and people in camouflage threw stones into windows of the Russian banks branches and office of a company owned by oligarch Akhmetov in the city center. Near Stella on the Maidan gathered a rally, the participants of which demanded the resignation of the authorities. They blocked the traffic lane of Kreshchatyk, set the barrel for warming up and an army tent. The National Guard units arrived in the center of the capital, no incidents were recorded.

The volunteers say that 53 people, who got missing during the events on the Maidan, have not been yet found. According to the lawyers of the victims, the "Berkut" special forces employees, who were beating the students, continue to work in the new police force. Poroshenko still promises to punish those responsible for the persecution and execution of the activists, but so far noone was punished for such actions. The Government extended the provision of the annual benefits to the families of the dead activists of the "Heavenly Hundred".

"Let’s protect a new police"

The scandal with the police officer, who shot the passenger of a car, which was violating the traffic rules, is escalating. After watching the video recorded by the chest cameras of the policemen, the court took the police officer into custody for two months. Interior Minister Avakov and his entourage, as well as some MPs support the actions of the policeman, despite the fact that they are contrary to the law. It was found out in the course of the investigation  that the policman had previously been involved into the persecution of the Automaidan activists. This case significantly damages the prestige of the new police force - as it is likely the only reform that shows visible results, as well as undermining the position of Interior Minister Avakov, and after him - Prime Minister, and is considered by a number of experts a political method of pressure on Yatseniuk by the President team. In this regard, on Sunday Avakov support group organized a rally in support of the police, which was attended by several hundred people.

A bribe from Putin to Yanukovych and the hryvnia exchange rate

Russia appealed to the London court with a claim to recover from Ukraine a three billion "Yanukovych's debt." Finance Minister Yaresko believes that the pre-trial decision on the restructuring is possible, but the conditions can not be better than the ones for other creditors. Foreign Minister Klimkin claimed that in court the Government will be proving that the funds granted to Ukraine after the secret talks between former President Yanukovych and Russian President Putin are the bribe in nature and content, and were embezzled by Yanukovych.

The Government has not yet agreed a memorandum on the second review of the IMF's lending program. IMF chief Lagarde was re-elected for another five-year term, therefore, the fundamental changes in the lending policy regarding Ukraine are not expected.

Within the conditions of political instability, absence of clear prospects for economic growth and restructuring of the debt to Russia, the hryvnia exchange rate continued to fall. On Tuesday another psychological mark was exceeded  - 27 UAH/$ and 30 UAH/€, after a small rate correction  through the auction currency sales by the National Bank in the middle of the week, the rate almost returned to its previous minimum level.

Strengthening the country's defense

US Ambassador to Ukraine Pyatt insists on the transition of the Armed Forces of Ukraine to the NATO standards. He considers the fight against corruption an essential element of the victory in the war with Russia. Pyatt reported on the allocation by the US Congress in the current year of $ 300 million for military exercises of the Ukrainian army and supply of non-lethal weapons.

The US delivered to Ukraine border control system, enabling automatic tracking of the movement of people, vehicles and vessels, which reduce human error. Preparatory work on the border is almost completed, the systems will come into operation as soon as possible.

Head of "Ukroboronprom" Romanov informed on the signing of the contracts by the concern for $ 1.3 billion in 2015, but the enterprises load is only 40%. Defense Minister Poltorak said that 4.5 times more funds than in 2015 will be allocated for the construction work in the defense sector  in 2016.

The Verkhovna Rada adopted a law allowing the President during the special period to call for military forces a month earlier than the official date. According to some experts, together with the right of partial mobilization, this unjustifiably extends the powers of the President under the conditions when the war has not been declared officially, and is a violation of civil freedoms.

Minsk talks are stalled

Militants continue to fire at the positions of the Ukrainian army, increasingly using artillery, self-propelled guns and MLRS "Grad". Fighting takes place in the vicinity of Donetsk, Horlivka, Mariupol, on the Volnovakha direction and at Svetlodarsk ledge. Every day the Army suffers losses. Chief of Staff Muzhenko confirmed that the troops are allowed to open fire in response to the attacks, but are forbidden to provoke the militants to fire. The OSCE Mission says that the movement of patrols on the occupied territory is constantly restricted by the "republics" authorities . In the Donbass arrived the first in month and a half "convoy" from Russia. According to observers from the field, it arrived half empty, and brought the expired canned food and "tutorials". After the arrival of the "convoy", the  participants of the military units and the "state employees" of the "republics" got paid. Thus, the financing of the militants by  Russia is being confirmed.

The next round of talks in Minsk brought no results. The Ukrainian side expressed concern about the systematic violation of the ceasefire by the militants and the reluctance to exchange the hostages. Representative at the talks, former President Kuchma said that Ukraine fulfills its commitments to implement the Minsk agreements in full, including the conducting of the elections in the occupied territories under the auspices of the OSCE, but the elections are impossible without a constructive approach and a political will of Russia.

On Saturday, the militants freed four Ukrainian soldiers, held as hostages for more than a year, in exchange for six members of the "DNR" illegal armed formations . Russian representative at the talks in Minsk Gryzlov said that Ukraine should adopt a law on amnesty for all militants to  exchange the hostages on the formula "all for all". According to the SBU information, 137 people are hostages, while the fate of about 700 is unknown. Their relatives for a year and a half are trying to obtain information about whether they are alive or find a place of their death and burial.

Transit War fades

The "Transit War" between Russia and Ukraine gradually subsides. After the introduction on February 15 of a total ban  for movement of lorries with Russian registration plates through Ukraine and after the massive  blocking by the civil activists of trucks across the country, Russia was forced to let the Ukrainian transport through. On February 18 it was decided to establish a ten day period, during which the Russian and Ukrainian trucks have to return home. Minister of Infrastructure Pivovarsky hopes that it would be possible to agree on the resumption of unimpeded transit of Ukrainian lorries to Kazakhstan in accordance with the WTO Agreement.

Restricting of the trucks transit stronger affects Russia than Ukraine, but Ukrainian exporters will also suffer significant losses due to the need to use the Trans-Caucasian corridor and two ferries across the Black Sea and the Caspian Sea.

According to the WTO rules, both countries violated the agreement on the free transit. Head of the State Fiscal Service Nasirov said that the blockade by the activists of the Russian transporters is a crime. However, the coordinated actions of  Ukraine and Poland, which also banned the transit of Russian trucks, can bring significant benefits to both countries in their relations with Russia.

Naftogaz intensifies the  pressure on Russia

Naftogaz has officially notified Russia on the beginning of the dispute over the captured in the Crimea Ukrainian property, including drilling rigs, natural gas distribution networks, underground storage facilities, fleet, oil and gas fields.

If Gazprom fails to pump through the Ukrainian gas transporting system the agreed  in 2009 contract amount of the natural gas, then its transportation costs will increase threefold.

Turkey and Ukraine - the goals of Russian aggression

Turkish Prime Minister Davutoğlu visited Ukraine on an official visit, during which it was agreed to grant to Ukraine a loan in amount of $ 50 million for the financing of the state budget general fund and the transfer to the Ukrainian Armed Forces of the fully equiped field hospital. Turkey supports the de-occupation of the Crimea, and intends to participate in the multilateral negotiations on the fate of the peninsula. Davutoğlu said about Turkey's willingness to sign with Ukraine an agreement on a free trade zone.

The terrorist threat in Turkey is growing every day. On Wednesday in the Turkish capital Ankara, in a terrorist attack,  28 people were killed, more than 60 - were wounded, most of the victims are soldiers; on Thursday a military convoy tripped a land mine in the south-east of the country, Kurdish militants took the responsibility for that.

In the event of a full-scale war in Syria, NATO will not support President Erdogan, however, US President Obama supported Turkey's right for defence.