Ukraine is holding its first presidential election since the 2004 Orange Revolution that swept pro-Western incumbent Viktor Yushchenko to power but ushered in years of turmoil, crises and now a recession.
Yushchenko beat Moscow-backed Viktor Yanukovich in a re-run of a vote declared fraudulent after weeks of street protests. Initial euphoria turned quickly to disenchantment and Yushchenko is unlikely to make it into the runoff, opinion polls show.
Yanukovich now tops the polls, followed by Prime Minister Yulia Tymoshenko — who stood side by side with Yushchenko during the 2004 protests but is now his bitter rival.
Neither Yanukovich nor Tymoshenko can muster enough support to win outright on Jan. 17. They are likely to face off in a second ballot three weeks later, according to opinion polls.
Investors hope the election will stop endless rowing that delayed reforms and stalled a $16.4 billion bailout from the International Monetary Fund, and open a new chapter of greater stability in the former Soviet republic.
Analysts see the dust settling at the earliest in April and perhaps not until the summer, because the result may be challenged and the eventual winner may call a parliamentary election to consolidate his or her power.
"Taking into account the fierce competition between the two main candidates and weakness of the Ukrainian legal system, the results of the election are likely to be contested … which may lead to a lengthy legal battle," Raiffeisen analysts said.
Some observers have suggested former Central Bank chairman Sergey Tigipko may have enjoyed a late surge in support, with one poll carried out by a Russian state-run pollster showing he could even beat Tymoshenko to go into the second round.
YANUKOVICH VICTORY
A victory for Yanukovich would mark a turnaround for the 59-year-old, discredited in 2004 after he was declared winner of a fraudulent poll. His power base is the Russian-speaking south and east, Ukraine’s industrial heart and home to its oligarchs.
To consolidate power, Yanukovich’s Regions Party would try to muster a coalition in parliament to form a government.
One way of ensuring this would be to ask Yushchenko’s Our Ukraine Party to join. Such a "grand coalition" had been touted for years but nothing has come of it. Yushchenko most recently said he would not collaborate with Yanukovich.
In the meantime, the government of Tymoshenko remains in place, and she may agree to stay on as premier if asked.
Alternatively, Yanukovich could call a snap parliamentary election, the third in five years, to seek an outright majority or bring in new forces as partners for the Regions Party.
Analysts say a Yanukovich administration would exercise tighter central control and be cautious on reform, reminiscent of former President Leonid Kuchma — Yushchenko’s predecessor.
Yanukovich’s foreign policy is expected to avoid total subordination to Russia — despite Moscow’s previous backing of him — or a total break with NATO, although he has said he will not push for membership.
Wealthy businessmen are likely to retain a tight grip on the economy and the main enterprises and to hold sway over politics.
If Yanukovich loses he may well disappear from the political landscape and the Regions Party may come close to a split.
TYMOSHENKO VICTORY
Tymoshenko, from the eastern city of Dnipropetrovsk but with support in Western and Central Ukraine, says only she can unite the country. She has promised not to dissolve parliament, saying she could create a coalition "within three minutes".
Analysts say her pragmatism may allow her to strike a pact with the Regions Party to consolidate her power in parliament.
The cost of a new election would be an incentive to reach a quick deal that would boost chances of restarting an IMF bailout programme with a $3.8 billion tranche of aid.
But a Tymoshenko-Yanukovich tie has been touted before and failed, and there is no guarantee the two rivals would be able to agree. Tymoshenko’s ambition for control may also lead her to call for a snap parliamentary election.
Tymoshenko, a populist, is not unlikely to push through the structural reforms that Ukraine has long needed. But she may hand that unpopular task to the government and distance herself from the outcome.
Once despised by Moscow for her role in the Orange Revolution and diatribes against corruption in the gas sector, she now has cordial ties with Russian Prime Minister Vladimir Putin.
She is expected to balance better relations with Moscow, which deteriorated under Yushchenko, with stronger ties to the European Union and Washington. But she will leave the issue of NATO membership alone for now.
DARK HORSE?
Polls published before a Jan. 2 cut-off showed that other candidates, including Tigipko and former foreign minister Arseniy Yatsenyuk, had no more than 10 percent support.
Most analysts still expect Yanukovich and Tymoshenko to contest the runoff. But a Russian poll this week found Tigipko may have gain ground and could create an upset by facing Yanukovich on Feb. 7.
The businessman headed Yanukovich’s election staff in 2004 but left before the third round of voting that brought Yushchenko the presidency.
