In the last three months, Prime Minister Yulia Tymoshenko has significantly boosted her ratings, while straining relations with the president.
If the Lord managed to create the world in six days, Yulia Tymoshenko had much more time to perform economic miracles. She herself defined a 100-day evaluation period when she took the prime minister’s chair in December 2007.
“In 100 days, the government will be re-examined,” Tymoshenko said in December. “They will look into our eyes and ask what has already been fulfilled with the Ukrainian Breakthrough (her election promises).”
And that day has arrived.
“The Cabinet has achieved direct contractual relations between Naftogaz and Gazprom, and that’s a positive,” said Party of the Regions of Ukraine Deputy Nestor Shufrych. “The minus is, certainly, inflation.”
In three months, Tymoshenko initiated a war against smuggling, began repaying Oschadbank deposits lost in the Soviet Union’s breakup, promised cheap mortgage credits at 4 to 6 percent, and, just as the 100day curtain descended, preterm mayoral elections for Kyiv.
She introduced incentives for energysaving technologies and promised to reduce the consumption of industrial gas by next winter. She advocated the creation of a competitive business environment but regulated food prices. She criticized the previous government for imposing grain export restrictions, and then imposed sunflower oil export quotas herself.
The opposition mercilessly criticizes the prime minister for this management style.
Her war with the Presidential Secretariat appeared in the press, and the mutual antipathy between the two became even more obvious than in 2005 during Tymoshenko’s first premiership.
Having surrounded herself with dubious friends and ruthless opponents, Tymoshenko doomed herself to political loneliness in the first 100 days.
Her time in power can be characterized as a time of victories. Owing to the Contraband Stop! program, customs income in January and February accounted for Hr 12.5 billion ($2.5 billion), Hr 6 billion ($1.2 billion) more than planned. Value added tax (VAT) debt returns were reduced from Hr 8 billion ($1.6 billion) to Hr 2 billion ($400 million).
“For the first time, changes to the budget state that land should be sold through auctions,” said Tymoshenko Bloc Deputy Bohdan Hubskiy. “It eliminates shadowy land sale schemes.”
In the struggle against the biggest shadow hanging above Ukraine, gas intermediary RosUkrEnergo, Tymoshenko cemented a victory, possibly eliminating it from future Gazprom supplies.
Her government also reached an agreement for prices to be kept low for direct gas deliveries to Ukraine, at $179.5 per 1,000 cubic meters of blue fuel.
Lost Oschadbank deposits, totaling Hr 3.5 billion ($700 million), were returned to the population.
The shadow government, led by former Prime Minister Viktor Yanukovych, is preparing an alternative report on Tymoshenko’s first 100 days in power.
“Tymoshenko’s government has cut expenses on energysaving programs 1.5 times,” said Party of the Regions of Ukraine Deputy Iryna Akimova. “If we take Tymoshenko’s statement that saving energy is her priority, we will see obvious discrepancies in her statements and actions.”
The opposition’s main criticism is high inflation. Although rising food prices are universal, in Ukraine inflation has reached a sevenyear high.
Akimova points to government actions to explain the high inflationary pressures, including plans to remit Hr 20 billion ($4 billion) in Oschadbank deposits.
“The conversations on antiinflationary measures remain simply conversations,” said Alexey Blinov, senior political economist at the Institute for the Study of Russia. “Presently, the government cannot slow down inflation without causing damage to economic growth or the growth of social payments.”
The Cabinet’s first 100 days have shown the key aim pursued by Tymoshenko is the battle for votes. In spite of the long lines of depositors near the cash departments of Oschadbank, the voter has sensitively reacted to authorities’ actions and has linked them with the prime minister.
About 20 percent of respondents were ready to vote for Tymoshenko as a presidential candidate at the end of December, according to the Fund of Public Opinion.
By March, that number swelled to 26.8 percent, more than a significant growth in sympathies for a threemonth period.
Tymoshenko’s leadership has amounted to nothing more than the watering of the electoral field with budgetary funds. She has tried to execute other preelection pledges as well, above all to force the capital’s mayor Leonid Chernovetskiy to resign.
The Parliament voted March 18 to hold preterm elections for Kyiv mayor and City Council. If this decision isn’t blocked by the courts, the elections will take place in May.
It will not be possible for Tymoshenko to completely satisfy the electorate. The Tymoshenko Bloc promised voters a contract army, but when illusions vanished, the realities of the povertystricken Ukrainian Defense Ministry forced Tymoshenko to think in a new direction.
Spring conscription has already been declared. But this local defeat has still gone unnoticed, at least by her subordinates.
“The prime minister is carrying out the obligations she has taken on,” said Hubskiy. “The Ministry is returning depositors’ money from Oschadbank, we shall remove all the corrupt officials led by Chernovetskiy.”
Despite these successes, Tymoshenko could still quit her post. The basic source of social payments should come from privatization revenues. And here Party of Regions Deputy Borys Kolesnikov couldn’t match debit with credit.
“Tymoshenko wants to sell the (state) enterprises and give the money to Oschadbank depositors,” Kolesnikov said. “But even a quick calculation shows that it is nothing but a venture: with the annual plan of privatization revenues at about Hr 8 billion ($1.6 billion), she cannot count on Hr 126 billion ($25.2 billion) in payments for two years.”
Another issue that could force Tymoshenko to quit is increasing inflation. It could eat all the Cabinet’s social achievements.
“There is a move to increase social transfers, deliveries of populist promises,” said Akimova. “It presents a question of macroeconomic stability.”
The basis for such instability is present.
The Ukrainian Sociological Service polled the population from Feb. 27 to March 8, revealing that 70 percent of Ukrainians are mostly concerned with a rapid rise in prices, 46 percent are anxious about low salaries and pensions, 36 percent with the low level of health services, 34 percent are disturbed by political instability, and 21 percent with unemployment growth.
However, alongside it, according to Ukrainian Sociological Service General Director Mykola Mihalchenko, only 16 percent of Ukrainians consider themselves poor.
Towards the end of the 1990s, that number stood at 40 percent; in 2000, 30 percent; in 2004, 20 percent.
There are two explanations for this phenomenon. The poor sectors of society either die out or grow rich. The authorities and opposition have different opinions on this issue.
But in fact Ukrainian policy, as well as the economy, has no eternal formulas or unions. And while the president battles daily against the prime minister, the opposition and semiopposition seek friendship with the strong woman just in case.
Yanukovych has declared that does not exclude a Party of Regions and Tymoshenko Bloc coalition. And Volodymyr Lytvyn has cautiously opined that he doesn’t mind the Cabinet working longer.
“The government did the main thing — strengthened its political position,” Lytvyn said. “And today I don’t see any factors that would lead to its dismissal.”
