(From L-R) Ukrainian United Democratic Alliance for Reform leader Vitali Klitschko and Ukrainian parliament members Andriy Shevchenko and Petro Poroshenko in London on March 26. (CARL COURT/AFP/Getty Images)
Summary
At Russian Foreign Minister Sergei Lavrov's meeting with U.S. Secretary of State John Kerry on March 30 in Paris, the Russian delegation demanded that Ukraine institute a federal system to empower its regions and remain neutral in its alliance systems. A day earlier, Vitali Klitschko, a boxer-turned-politician and frontrunner in Ukraine's presidential race, withdrew his candidacy and endorsed Petro Poroshenko, a pro-Western oligarch. While high-level negotiations between the United States and Russia are shaping a possible compromise in Ukraine, and Klitschko's endorsement of Poroshenko has redefined the country's presidential race, Ukraine's future hinges largely on the unity and stability of its interim government.
Analysis
Despite its interim status, Ukraine's Cabinet under Prime Minister Arseniy Yatsenyuk is playing a central role in Ukraine's negotiations with the international community. The government, which took power after President Viktor Yanukovich's ouster, has signed the political chapters of an association agreement with the European Union, reached a staff-level agreement with the International Monetary Fund and opened limited channels of communication with the Kremlin. So far, the Cabinet -- which comprises representatives of the Fatherland and Svoboda parties, as well as independents -- has shown public unity on the most pressing issues facing Ukraine.
By law, because the most recent parliamentary elections occurred in 2012, new parliamentary elections do not have to be held until 2017 (though elections likely will take place before then). This gives the interim government some leeway and time to implement far-reaching reforms as long as it has the support of political factions outside the Cabinet.
On March 27, the International Monetary Fund offered Ukraine an aid package of between $14 billion and $18 billion, while a total of up to $27 billion could be unlocked over the next two years should Ukraine continue to implement reforms. Later that day, the interim government introduced a bill, approved by the country's parliament, which among other things will raise household natural gas prices by 50 percent (effective May 1) and increase income taxes. The bill passed with support from the Fatherland and Svoboda parties, as well as independent members of parliament and Klitschko's United Democratic Alliance for Reform party. Two parliamentary groups consisting mostly of former members of the Party of Regions -- Sovereign European Ukraine and Economic Development, each of which controls 36 seats in the legislature -- also supported the bill. The adoption and implementation of these reforms depend therefore on the willingness of a diverse group of political actors to continue supporting the interim government.
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The Government's Stake in U.S.-Russian Talks
While most Ukrainian policymakers support giving the country's regions some degree of autonomy, a key Kremlin demand for resolving the Ukrainian crisis is federalization, whereby each region's governor would be elected locally and regional legislatures would have control over finances. For Russia, federalization would allow the Kremlin to develop close political and economic relations with the newly empowered eastern oblasts of Ukraine. Within Ukraine, support for federalization comes primarily from local politicians in the country's east, as it would give them greater control over resources in Ukraine's wealthiest regions and allow them to reorient eastern regions toward Russia.
As the federalization of Ukraine becomes a central point in negotiations between the United States and Russia, and as the International Monetary Fund pushes for more economic and structural reforms, the interim government will come under greater pressure from the Kremlin, as well as far-right groups and constituents suffering from austerity measures. The unity and stability of the interim government in the face of these challenges, as well as continued support from non-government political parties in the parliament, will thus be critical for the implementation of international agreements and economic reforms.
The Competitors in Kiev
Several groups are competing for power and a place in any future political structure in Ukraine. The first is the Fatherland Party, under the leadership of Yatsenyuk and former Prime Minister Yulia Timoshenko. While Timoshenko has been willing to cooperate with Moscow in the past, Fatherland is currently Western-oriented and can be expected to push for further integration with the European Union in the near future in trying to balance against Russia. Yatsenyuk is willing to introduce painful reforms to allow Ukraine to receive much-needed financial assistance from the international community. He has also declared his intent to push for constitutional changes that would decentralize Ukraine. In the long run, should the European Union fail to sufficiently support Ukraine politically and financially, elements within Fatherland may be open to seeking an accommodation with Russia.
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In recent months, the nationalist Svoboda party has played an active and sometimes aggressive role in the coalition that has represented the opposition throughout Ukraine's protests. Three members of the interim government belong to Svoboda, holding the posts of deputy prime minister, environment minister and agriculture minister. A fourth Svoboda member, interim Defense Minister Igor Tenyukh, resigned last week, reportedly due to criticism of his management of Ukrainian troops during the crisis in Crimea. This was the first high-profile personnel change in the interim government since its formation. While Svoboda has been committed to cooperating with both Fatherland and the United Democratic Alliance for Reform throughout the protests and the formation of the interim government, the party's strongly nationalist and right-wing ideology ultimately could put it at odds with more pragmatic members of the coalition.
While not a part of the interim government, the United Democratic Alliance for Reform cooperated closely with Fatherland throughout the anti-Yanukovich protests. Klitschko's party has close ties with the West, especially German Chancellor Angela Merkel's Christian Democratic Union. Nevertheless, the party chose not to take part in the current interim government out of fears that it would have to make unpopular decisions that would cripple it politically. After withdrawing from the presidential race, Klitschko announced his decision to run for mayor of Kiev instead and threw his support to Poroshenko, a pro-Western oligarch and the seventh-wealthiest man in Ukraine. A former minister of foreign affairs and minister of trade and economic development, Poroshenko owns the confectionary Roshen, whose products Russia temporarily banned a year ago. In mid-March, Russian authorities raided and stopped production at a Roshen-owned factory in southwestern Russia.
While Poroshenko is likely to do well in the upcoming presidential elections, his influence in Ukraine's parliament -- the Verkhovna Rada -- is relatively limited as his party, Solidarity, is not currently formally represented in the legislature. However, Poroshenko's personal popularity and significant financial resources, along with Klitschko's endorsement, are likely to provide him with influence over the interim government as a power broker.
Possible Challenges From Party of Regions
The remnants of Yanukovich's Party of Regions could present a challenge for the interim government. Despite Yanukovich's ouster and a mass desertion from the party's parliamentary caucus, the party still holds nearly a third of the seats in the Verkhovna Rada (not including independents, who could side with the party). Although Party of Regions presidential candidates such as Sergei Tigipko and Mikhail Dobkin are unlikely to win the presidential election, they have a significant voting base in eastern Ukraine.
Thus far, many Party of Regions officials have shied away from participating in parliamentary debates and votes. However, the party can shape legislative outcomes, especially if it begins cooperating with independent members of parliament, many of whom are former Party of Regions members. This presents the interim government with both opportunities and risks. On one hand, some elements of the Party of Regions could support decentralization, seeing it as a step toward federalization. On the other, pro-Russian elements of the party could attempt to derail economic reforms in an effort to appeal to constituents and avoid further cooperation with the International Monetary Fund.
With 60 of the Verkhovna Rada's 450 members currently labeling themselves independents and 72 belonging to the two parliamentary groups formed in February (mostly for former members of the Party of Regions), a significant portion of the legislature is open to forming new alliances -- or returning to old ones. The Communist Party, with 32 members, could also serve as an important swing vote.
The Right Sector Threat
One of the most significant challenges for the stability of the interim government comes from the Right Sector, an amalgamation of several far-right militant groups and disgruntled Ukrainians that came together after the Nov. 30 crackdown on opposition protesters by Ukrainian authorities. The group has already begun challenging Ukraine's new authorities. Most recently, on March 27, several hundred Right Sector members and sympathizers protested outside the Verkhovna Rada and returned the next day, demanding that the government dismiss interim Minister of the Interior Arsen Avakov and initiate a formal inquiry into the death of Alexander Muzychko, a Right Sector leader who was killed during a police attempt to arrest him in the city of Rivne on March 25.
Once primarily a violent fringe group, Right Sector recently launched a formal political party led by Dmytro Yarosh. Currently serving as deputy secretary of the Security and Defense Council, Yarosh is running for president, though recent polls show him receiving less than 2 percent of popular support. However, the death of Muzychko, as well as the arrest of several far-right activists on murder charges over the weekend, demonstrates the new government's resolve to crack down on extremists unwilling to integrate into state structures. While Yarosh has affirmed his commitment to working within state institutions (at least publicly), parts of the loosely organized Right Sector -- as well as militant groups such as Spilna Sprava -- still pose a challenge for the government and law enforcement. More conflicts between mainstream parties and organizations like the Right Sector are likely in the near future.
The interim government's ability to remain united as it faces growing pressure from Russia, domestic economic troubles and challenges from far-right groups depends on continued cooperation among diverse political parties within Ukraine's parliament, as well as the international community's commitment to keep its promises of financial assistance to Kiev. Without the support of non-governmental parties such as the United Democratic Alliance for Reform and a significant group of former Party of Regions members in parliament, the interim government will not be able to implement international agreements and economic reforms. Moreover, Ukraine needs large amounts of international funds to avoid a default and prevent constituents from turning against the interim government. Without sufficient and continued international economic assistance, any Ukrainian government would eventually be forced to turn to the Kremlin for help. While ongoing international negotiations and Ukraine's presidential race will help shape the direction of the country, the potential paralysis of the interim government will define its future.
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