ANALYSIS: Kuchma's illusive 2004 candidate (06/29/03)

ANALYSIS

Kuchma's illusive 2004 candidate

by Taras Kuzio

Whom will President Leonid Kuchma choose as the pro-presidential candidate for the October 2004 elections? Discussions are under way between Viktor Yushchenko, head of the pro-reform Our Ukraine bloc, and two radical opposition groups, Oleksander Moroz's Socialists (SPU) and Yulia Tymoshenko's bloc, to unite behind Mr. Yushchenko.

Mr. Yushchenko has maintained his position as Ukraine's most popular politician since he was prime minister from December 1999 to April 2001. In a May poll by the Ukrainian Democratic Circle, Mr. Yushchenko obtained 27.8 percent backing (rising to 42.3 percent if Mr. Moroz's and Ms. Tymoshenko's support is added), while Communist Party of Ukraine (CPU) leader Petro Symonenko got 17.9 percent. The opposition is likely to have two candidates - Mr. Yushchenko and the CPU's Mr. Symonenko.

Of the two opposition candidates, Mr. Yushchenko is clearly the favorite. No Communist candidate relying solely on CPU support would be able to win elections in Ukraine. With their high ratings, both opposition candidates could possibly enter the second round, which would make a Mr. Yushchenko victory certain.

It has always been in President Kuchma's interest to have the opposition vote fractured with all four opposition leaders as candidates. In May, Mr. Kuchma said that Mr. Yushchenko had made a mistake in not siding with pro-presidential centrists after the 2002 elections, and he ridiculed talk of a united opposition candidate.

An April poll by Kyiv's Politychna Dumka (Political Thought) journal discussed four possible scenarios for 2004. The best scenario, from the viewpoint of anti-Kuchma forces, was a joint non-Communist opposition candidate leading to Messrs. Yushchenko and Symonenko entering the second round, where they would obtain 53.1 percent and 28.8 percent, respectively, of the votes.

In these four scenarios, a pro-Kuchma candidate would have to obtain sufficient support in the first round in order to beat Mr. Symonenko into the second round. Individual opinion polls for the three potential pro-presidential candidates - Prime Minister Viktor Yanukovych, National Bank of Ukraine Chairman Serhii Tyhypko, and presidential administration head Viktor Medvedchuk - are low. But they should be added together with an additional five percent to 10 percent from "administrative resources." Although opposition candidates have access to state television's Channel 1, they will be blocked from Channels 2 and 3 controlled by Mr. Medvedchuk.

Two separate sources inside Poland and in Kyiv have learned that President Kuchma confided in President Aleksander Kwasniewski on a visit to Poland earlier this year that his preferred presidential candidate was Mr. Tyhypko. Such a choice would certainly be logical as Mr. Tyhypko, although re-elected head of the Dnipropetrovsk clan's Labor Ukraine Party at its April congress, is not commonly perceived as a corrupt oligarch. Mr. Tyhypko also has a relatively good image in the United States as a "reformer" - the only one with such an image among pro-presidential leaders. After becoming NBU chairman head in December, Mr. Tyhypko began a self-promotion campaign that nobody in that position had ever undertaken.

Within Ukraine both Mr. Medvedchuk and Mr. Yanukovych have drawbacks in relation to Mr. Tyhypko. Mr. Medvedchuk has made even more enemies than he already had prior to becoming presidential administration head in May 2002. The Social Democratic Party-united (SDPU), which is led by Mr. Medvedchuk, is the only oligarch party unpopular in its home base, in Kyiv. There are indications that Mr. Medvedchuk is willing to sit out the 2004 election and work towards the 2009 elections, including as head of the SDPU opposition party, if Mr. Yushchenko wins.

Mr. Yanukovych's rating is growing because of his dynamism since becoming prime minister in November 2002. His visit to Paris in May was deemed a success and considered the best visit to France by any Ukrainian government. Mr. Yanukovych's usefulness to President Kuchma was in converting the Donbas into a "mini-Belarus," as Ukrainian commentators have described it, where he has ensured the domination of the local "party of power" (Regions of Ukraine).

Mr. Yanukovych's strength in the Donbas may be his liability in the remainder of Ukraine. Although Mr. Yanukovych will be prime minister for nearly two years prior to the 2004 elections, it is not clear that this is sufficient time to change his image from oblast chairman of Ukraine's "mini-Belarus" to a potential president of Ukraine.

Mr. Tyhypko has advantages over both Messrs. Medvedchuk and Yanukovych, as he is the best of the three to take on Mr. Yushchenko. Whether Mr. Tyhypko's image of an oligarchic "reformer" conforms to reality is difficult to say. His proficiency was never rated highly when he was vice prime minister and economy minister in the government of Valerii Pustovoitenko in 1997-1999. Ms. Tymoshenko, leader of the eponymous opposition bloc, claims that when Mr. Tyhypko was economy minister in the Mr. Yushchenko government, he "professionally sabotaged all of my work" (P. Loza, "Nevypolnennyi Zakaz," Kyiv, Taki Spravy, 2002, p. 70). In May 2000 Mr. Tyhypko resigned in protest as economy minister over reforms introduced by the Yushchenko government.

The manner in which Mr. Tyhypko became head of the National Bank in November 2002 also is not a good indicator of his character. After failing to obtain sufficient votes, a dubious secret voting system was created to ensure the replacement of Yushchenko loyalist Volodymyr Stelmakh. Mr. Tyhypko's appointment marks the first time the head of a political party has headed the National Bank - a factor the Ukrainian Bank Association sees negatively because of its impact on the bank's independence.

In January and July 2002, Tymoshenko Bloc member and lawmaker Hryhorii Omelchenko sent documents to the Procurator General's Office detailing accusations against Mr. Tyhypko of money laundering and transfers of hard currency from Ukraine in 1995-1996, when Mr. Tyhypko was head of Pryvatbank (1992-1997), Ukrayina Moloda reported on November 28, 2002. The "Grani" website, linked to the Socialist Party, published in May 2001 the names of offshore companies linked to Pryvatbank. Ironically, one of Mr. Tyhypko's first actions as NBU chairman was to discuss illegal capital flight, which had grown to a record $2.27 billion in 2002 under the government of Anatolii Kinakh that replaced Mr. Yushchenko's.

Besides being a presidential candidate, Mr. Tyhypko's major service to pro-presidential forces in the 2004 elections could be his control over financial resources. He is already indulging in monetary populism by offering to repay bank deposits at Oshchadbank lost during the hyperinflation of 1993 by issuing dollar-denominated, long-term state bonds.

Dr. Taras Kuzio is a resident fellow, Center for Russian and East European Studies, University of Toronto, and visiting fellow, Institute for Security Studies - European Union, Paris.

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