Ukraine's Orange Revolution will draw to a close on Sunday, 17 January, as Ukrainians cast their ballots in the presidential polls that will eject the incumbent president but are unlikely to give an outright winner, making a run-off second round inevitable.
Significance
Ukrainians are voting on 17 January in the country’s presidential election amid worsening economic conditions, bitter rivalry between the candidates and widespread disillusion amongst voters.
Implications
The election will determine the two candidates who will progress to run-off polls after years of political deadlock between incumbent President Viktor Yushchenko and Prime Minister Yulia Tymoshenko.
Outlook
The election is unlikely to produce a winner; the two forerunners, Viktor Yanukovych and Yulia Tymoshenko, are the likely candidates to face off in the second round of polls on 7 February although chances of Serhiy Tyhypko coming second and leaving Tymoshenko out of the race should not be discounted.
Empty Coffers and Empty Squares
Ukrainians are casting their ballots on Sunday (17 January) under woeful economic and political conditions. The economy is in tatters not only due to the failure of the 2004 Orange Revolution leaders to restructure the economy, root out corruption and oligarchic monopolies, and allow small and medium businesses to grow. Most recently the country has been hit by the global economic crisis, worsened by the cross-party populist agenda. To win voter support the presidential candidates, with the exception of Prime Minister Yulia Tymoshenko, sponsored a bill increasing salaries and wages by 20%. This caused a domino effect. The increase in public spending when austerity was needed forced international donors, chiefly the International Monetary Fund (IMF), to halt delivery of a US$3.8-billion loan, part of the
US$16.4-billion standby credit agreement. This then led to the near-breakout of a new gas war with Russia as Ukraine found itself incapable of paying its gas bill. The follow-up lowering of national reserves threshold and paying the public bills out of state reserves has saved the day so far but has also damaged Ukraine’s credit ratings and attractiveness as an investment destination.
The continuous squabbles between the two leaders of the Orange Revolution, President Viktor Yushchenko and Tymoshenko, whose relations turned from friend to foe shortly after gaining power, consumed efforts which should
have been channelled into transforming Ukraine from a Communist country into a European one, aspiring to join NATO and the European Union (EU). The public debacle of the democratic forces has left voters deeply disappointed with democracy and their political leaders.
Profiles and Pledges
There are 18 candidates vying for the presidency but Viktor Yanukovych and Yulia Tymoshenko are the main contenders. Given the high number of candidates the run-off election scheduled for 7 February are inevitable due to fragmentation of the vote. The incumbent will almost certainly be ousted since he has garnered only 3.5% voter support in recent opinion polls.
Viktor Yanukovych:
The former governor of Ukraine’s eastern DonetskOblast and twice Prime Minister, Viktor Yanukovych is the most likely
candidate to win in the first round. Yanukovych, the leader of the Party of Regions (PoR), has staged a remarkable comeback after his 2005 ejection from the presidential contest following a vote recount in the wake of popular protests. According to opinion polls, he holds a comfortable 32-42%. Against the backdrop of repeated failures of the incumbent, which have kept Ukraine in a state of political and economic limbo, many are ready overlookYanukovych’s thuggish past, close connections with the eastern Ukrainianheavy industries’ oligarchs and pro-Russian stance. Yanukovych has edged towards the middle ground in an attempt to enhance voter appeal outside the largely Russian-speaking eastern Ukrainians, whose support he is virtually guaranteed. In a bid to achieve this Yanukovych has distanced himself from Russia, announcing he would review the 10-year gas deal that Tymoshenko concluded in mid-November 2009 to avert a gas war between the two countries, arguing that the Russian gas price for Ukraine is too high. Besides the gas issues, he does not see any major problems with Russia and promises to rectify the damage that was done to the strategic partnership with Russia. However Yanukovych also promises a balanced foreign policy. While dismissing
EU and NATO membership he has promised to enhance business ties with the European bloc. Economically Yanukovych has committed himself to generoussocial welfare deals by sponsoring the infamous October 2009 pensions and wages increase bill. However Yanukovych has not explained how this spending will be financed, given the grave financial shortages that the country faces. He is likely to borrow the Kremlin’s style of economic management and may resort to state intervention especially in areas of national strategicinterests.
Yulia Tymoshenko:
The Prime Minister and leader of the YuliaTymoshenko Bloc (BYT), Tymoshenko is likely to be the second candidate. There is a considerable 10% gap between her and Yanukovych as she currently holds only 22% approval rating. With her presidential platform Tymoshenko iscloser to the centre than Yanukovych. Her power base is in pro-EU western and central Ukraine; however in a bid to appeal to Russian speakersTymoshenko has toned down the anti-Russian rhetoric. She further boosted her ratings by a successful rapprochement with Russia when she managed to seal agas deal with her difficult Russian counterpart Vladimir Putin in mid-November 2009. In a last ditch effort to differentiate herself from Yanukovych, Tymoshenko promised yesterday to bring Ukraine into the EU inthe next five years; however this promise has been largely discredited since five years after the Orange Revolution, Ukraine is no nearer to EU membership. Tymoshenko does however have a relatively clearer economic plan than her chief opponent. Once in power she will pursue economic austerity measures to restart borrowing from the IMF. Tymoshenko has also promised to deal with the oligarchs of eastern Ukraine and restart privatisation. It is very likely that she will launch the privatisation of Naftogaz Ukrainy, Ukraine’s state-controlled gas monopoly. Given the major Russian interest in the company Russia may acquire a stake in it, which in turn will lessen the chances of future Russian-Ukrainian gas wars.
Serhiy Tyhypko:
Could prove to be the unexpected challenger in the elections. Tyhypko, a successful multimillionaire banker and once adviser to both Yanukovych and Tymoshenko, trails behind the current prime minister with 7%. A centrist and a technocrat running as an independent, there is speculation that Tyhypko is really positioning himself for the prime ministerial position. In the current economic crisis voters may find his sound economic and banking skills attractive, giving him a lead over Tymoshenko and landing him in the run-off. The likelihood is low but cannot be excluded, especially after yesterday’s statement by Tymoshenko about brining Ukraine into the EU which may have cost her votes among centristvoters who want to see Ukraine positioned in the middle of Russia and the EU and not adhering to either side.
End of Orange Rule, Beginning of Second Red Era?
It can be safely concluded that 17 January will end the Orange Revolution. It can also be concluded that regardless of who is elected as a president, he or she will have to mend the economy by curbing public spending, addressing widespread corruption and nepotism, and raising the creditworthiness of the country. In this sense, a return to an era of Communism is unlikely. Even if Yanukovych is elected he will have to undertake market-oriented reforms or risk not being able to finance his bloated social welfare system given that cash-strapped Russia, his closest ally, will not be able to provide him with financial lending comparable to that offered by the IMF. Given the nature of Ukraine’s problems it is not surprising that both candidates have centrist approaches with more commonalities than differences. It is the true reflection of this 46-million-strong country divided by language and political orientation and untied by nationality. Perhaps the major oversight of the Orange Revolution was the alienation of parts of the Ukrainian population, something that the current candidates have realised and tailored their platforms accordingly.
The election will bring an end to the Orange Revolution and open a door to long period of reflection and reorientation from quick revolutionary fixes to more laborious but ultimately productive policies of sustainable changes.
By Lilit Gevorgyan,IHS Global Insight political analyst.
