Institute for the Study of Conflict, Ideology and Policy

Home

• • • • •

The ISCIP Analyst

Perspective

Behind the Breaking News

Books

Publication Series

• • • • •

Database

Lecture Series

Links

• • • • •

Search The ISCIP Analyst (formerly the NIS Observed):

The ISCIP Analyst

Volume XVI, Number 1, Part II

Back Issues

Volume XVI

No. 1, Part I (17 September 2009)

Volume XV

No. 15 (20 August 2009)

No. 14 (30 July 2009)

No. 13 (25 June 2009)

No. 12 (30 April 2009)

No. 11 (16 April 2009)

No. 10 (26 March 2009)

No. 9 (5 March 2009)

No. 8 (19 February 2009)

No. 7 (5 February 2009)

No. 6 (11 December 2008)

No. 5 (20 November 2008)

No. 4 (6 November 2008)

No. 3 (23 October 2008)

No. 2 (9 October 2008)

No. 1 (18 September 2008)

Volume XIV

No. 15 (18 August 2008)

No. 14 (24 July 2008)

No. 13 (19 June 2008)

No. 12 (24 April 2008)

No. 11 (10 April 2008)

No. 10 (27 March 2008)

No. 9 (28 February 2008)

No. 8 (14 February 2008)

No. 7 (31 January 2008)

No. 6 (17 December 2007)

No. 5 (15 November 2007)

No. 4 (1 November 2007)

No. 3 (18 October 2007)

No. 2 (4 October 2007)

No. 1 (20 September 2007)

Volume XIII

No. 15 (26 July 2007)

No. 14 (28 June 2007)

No. 13 (7 June 2007)

No. 12(26 April 2007)

No. 11(12 April 2007)

No. 10(29 March 2007)

No. 9(8 March 2007)

No. 8(22 February 2007)

No. 7(8 February 2007)

No. 6(25 January 2007)

No. 5(7 December 2006)

No. 4(9 November 2006)

No. 3(19 October 2006)

No. 2(5 October 2006)

No. 1(21 September 2006)

Volume XII

No. 8(17 August 2006)

No.7(20 July 2006)

No. 6 (15 June 2006)

No. 5 (25 May 2006)

No. 4 (20 April 2006)

No. 3 (17 March 2006)

No. 2 (16 February 2006)

No. 1 (27 January 2006)

Volume XI
No. 4 (08 December 2005)

No. 3 (17 November 2005)
No. 2 (03 November 2005)
No. 1 (20 October 2005)

Volume X
No. 9 (11 August 2005)
No. 8 (26 July 2005)
No. 7 (8 June 2005)
No. 6 (25 April 2005)
No. 5 (6 April 2005)
No. 4 (25 March 2005)
No. 3 (4 March 2005)
No. 2 (11 February 2005)
No. 1 (31 January 2005)

Volume IX
No. 19 (9 December 2004)
No. 18 (10 November 2004)
No. 17 (28 October 2004)
No. 16 (15 October 2004)
No. 15 (29 September 2004)
No. 14 (15 September 2004)
No. 13 (18 August 2004)
No. 12 (4 August 2004)
No. 11 (15 July 2004)
No. 10 (23 June 2004)
No. 9 (12 June 2004)
No. 8 (12 May 2004)
No. 7 (28 April 2004)
No. 6 (8 April 2004)
No. 5 (26 March 2004)
No. 4 (5 March 2004)
No. 3 (19 February 2004)
No. 2 (06 February 2004)
No. 1 (23 January 2004)

Volume VIII
No. 20 (11 December 2003)
No. 19 (20 November 2003)
No. 18 (7 November 2003)
No. 17 (24 October 2003)
No. 16 (10 October 2003)
No. 15 (25 September 2003)
No. 14 (12 September 2003)
No. 13 (22 August 2003)
No. 12 (10 August 2003)
No. 11 (10 July 2003)
No. 10 (18 June 2003)
No. 9 (28 May 2003)
No. 8 (7 May 2003)
No. 7 (23 April 2003)
No. 6 (9 April 2003)
No. 5 (26 March 2003)
No. 4 (5 March 2003)
No. 3 (19 February 2003)
No. 2 (5 February 2003)
No. 1 (22 January 2003)

Volume VII
No. 20 ( 18 December 2002)
No. 19 ( 4 December 2002)
No. 18 (20 November 2002)
No. 17 (30 October 2002)
No. 16 (16 October 2002)
No. 15 (25 September 2002)
No. 14 (11 September 2002)
No. 13 (21 August 2002)
No. 12 (24 July 2002)
No. 11 (10 July 2002)
No. 10 (12 June 2002)
No. 9 (22 May 2002)
No. 8 (1 May 2002)
No. 7 (17 April 2002)
No. 6 (3 April 2002)
No. 5 (13 March 2002)
No. 4 (27 February 2002)
No. 3 (13 February 2002)
No. 2 (30 January 2002)
No. 1 (16 January 2002)

Volume VI
No. 20 (12 December 2001)
No. 19 (28 November 2001)
No. 18 (7 November 2001)
No. 17 (24 October 2001)
No. 16 (10 October 2001)
No. 15 (26 September 2001)
No. 14 (12 September 2001)
No. 13 (21 August 2001)
No. 12 (1 August 2001)
No. 11 (10 July 2001)
No. 10 (13 June 2001)
No. 9 (23 May 2001)
No. 8 (2 May 2001)
No. 7 (18 April 2001)
No. 6 (4 April 2001)
No. 5 (21 March 2001)
No. 4 (28 February 2001)
No. 3 (14 February 2001)
No. 2 (31 January 2001)
No. 1 (17 January 2001)

Volume V
No. 19 (13 December 2000)
No. 18 (29 November 2000)
No. 17 (11 November 2000)
No. 16 (25 October 2000)
No. 15 (11 October 2000)
No. 14 (27 September 2000)
No. 13 (13 September 2000)
No. 12 (23 August 2000)
No. 11 (2 August 2000)
No. 10 (12 July 2000)
No. 9 (21 June 2000)
No. 8 (16 May 2000)
No. 7 (24 April 2000)
No. 6 (4 April 2000)
No. 5 (21 March 2000)
No. 4 (29 February 2000)
No. 3 (15 February 2000)
No. 2 (1 February 2000)
No. 1 (18 January 2000)

Volume IV
No. 20 (20 December 1999)
No. 19 (6 December 1999)
No. 18 (15 November 1999)
No. 17 (1 November 1999)
No. 16 (18 October1999)
No. 15 (27 September 1999)
No. 14 (13 September 1999)
No. 13 (31 August 1999)
No. 12 (4 August 1999)
No. 11 (14 July 1999)
No. 10 (23 June 1999)
No. 9 (2 June 1999)
No. 8 (10 May 1999)
No. 7 (5 April 1999)
No. 6 (5 April 1999)
No. 5 (22 March 1999)
No. 4 (1 March 1999)
No. 3 (15 February 1999)
No. 2 (1 February 1999)
No. 1 (13 January 1999)

Volume III
No. 18 (9 December 1998)
No. 17 (16 November 1998)
No. 16 (4 November 1998)
No. 15 (21 October 1998)
No. 14 (7 October 1998)
No. 13 (16 September 1998)
No. 12 (2 September 1998)
No. 11 (3 August 1998)
No. 10 (16 July 1998)
No. 9 (18 June 1998)
No. 8 (28 May 1998)
No. 7 (7 May 1998)
No. 6 (23 April 1998)
No. 5 (26 March 1998)
No. 4 (5 March 1998)
No. 3 (19 February 1998)
No. 2 (5 February 1998)
No. 1 (22 January 1998)

Volume II
No. 22 (4 December 1997)
No. 21 (20 November 1997)
No. 20 (6 November 1997)
No. 19 (23 October 1997)
No. 18 (10 October 1997)
No. 17 (25 Sep 1997)
No. 16 (9 Sep 1997)
No. 15 (20 Aug 1997)
No. 14 (6 Aug 1997)
No. 13 (23 July 1997)
No. 12 (9 July 1997)
No. 11 (18 June 1997)
No. 10 (4 June 1997)
No. 9 (21 May 1997)
No. 8 (7 May 1997)
No. 7 (23 April 1997)
No. 6 (9 April 1997)
No. 5 (26 March 1997)
No. 4 (5 March 1997)
No. 3 (19 February 1997)
No. 2 (5 February 1997)
No. 1 (22 January 1997)

Volume I
No. 4 (18 December 1996)
No. 3 (4 December 1996)
No. 2 (20 November 1996)
No. 1 (6 November 1996)

The ISCIP Analyst

Volume XVI, Number 1, Part II (24 September 2009)

Caucasus by Robyn Angley

Central Asia by Monika Shepherd

Western Regions by Tammy Lynch

~~~~~



CAUCASUS REGION

GEORGIA

New Defense Minister
President Mikheil Saakashvili has replaced Defense Minister David Sikharulidze with former head of the prison system Bacho Akhalaia. Akhalaia’s appointment seems both to reflect Saakashvili’s desire for a more rigidly top-down approach to leadership in the Defense Ministry, as well as to bolster the political clout of Interior Minister Vano Merabishvili, with whom Akhalaia is rumored to have close ties.

This appointment heads the second wave of replacements in the Defense Ministry since the conflict with Russia in August 2008. The first wave was marked by David Sikharulidze’s appointment as Defense Minister in December 2008. At that time, Akhalaia also joined the Defense Ministry in the capacity of Deputy Defense Minister. In that role, he was rumored to have clashed with both Sikharulidze and then head of the Joint Chiefs, Colonel Vladimer Chachibaia. (1)

In replacing Sikharulidze, Saakashvili cited the need for a “much stricter hand” in the Defense Ministry as one of the reasons behind the change in leadership. (2) Akhalaia has stated that his focus will be improvement of the military’s “combat capabilities in order to help preserve peace” and advancing compliance measures for NATO integration. (3) In light of the August 2008 conflict with Russia, it is manifestly evident that these “combat capabilities” refer to preparation for potential future Russian aggression.

Despite his youth (the new minister will turn 29 in October), Akhalaia already has an impressive record. He worked for the Liberty Institute (an NGO with close ties to politicians within Saakashvili’s United National Movement party) before transitioning to government. A year-long stint as the Deputy Public Defender was succeeded by his appointment to head the nation’s penitentiary system, a position which he held for three years. (4) Akhalaia brings to his new post a reputation as a hardliner; his tenure as prison chief was marked by a major riot and subsequent crackdown in which seven prisoners lost their lives.

Akhalaia is part of the Liberty Institute group within the government, named after the Liberty Institute NGO that played an active role during the time of the Rose Revolution. Other former Liberty Institute activists now in government include Deputy Foreign Minister Giga Bokeria, Parliamentary Defense and Security Committee Chairman Givi Targamadze, and Interior Minister Vano Merabishvili. Of the various Liberty Institute personnel who have migrated into government, it is Akhalaia’s association with Merabishvili that has drawn the most criticism.

Merabishvili is despised by Saakashvili’s most radical opposition; the demand for his resignation is a central theme to all government-opposition negotiations. Merabishvili’s centrality to the Saakashvili government is reflected in his continued tenure as head of the Interior Ministry, despite numerous ministerial reshuffles that have reassigned most of his government colleagues. Merabishvili’s critics have branded Akhalaia’s appointment as an attempt to incorporate the Defense Ministry into the Interior Ministry. (5)

The reasoning behind the timing of the leadership shuffle is unclear. It may be, as some suggest, that Saakashvili is working to maintain balance among the various factions within his United National Movement party. (6) It is also possible that, despite rumors of Sikharulidze’s possible resignation last spring, Saakashvili retained him through the conflict-prone summer because he was rumored to be favored by Western governments; in the event of an increase in tensions with Russia or the separatist republics, Sikharulidze’s involvement might have resulted in a more prompt response. Indeed, Akhalaia already was rumored to have been deeply involved in various aspects of the Defense Ministry activities even before his latest promotion. Having weathered the summer, Saakashvili simply may have formalized Akhalaia’s de facto ascendant role.

Regardless of the logic behind the new Defense Minister appointment, the priority of the Defense Ministry remains strengthening the military’s ability to respond to potential Russian or Russian-backed aggression. Thus far, Tbilisi, Moscow, Tskhinvali and Sukhumi have managed to avoid further escalations of tension, despite frequent low-level incidents. However, the possibility of further conflict remains high and is one for which the Georgian military must prepare.

ARMENIA

Almost official
Ankara and Yerevan have announced their intention to sign an agreement to establish formal diplomatic relations in mid-October. The step is not a given: The protocols for establishing diplomatic relations and other bilateral arrangements are contingent on the results of six weeks of internal negotiations within each country and must be ratified by both parliaments. Both Turkey and Armenia have domestic pressure groups that fiercely oppose this step in normalizing their relations.

Several issues traditionally have stood in the way of improving Turkish-Armenian relations.  The first is Armenia’s conflict with neighboring Azerbaijan—a Turkish ally—over Nagorno-Karabakh. The second is closely related; the closed border between Turkey and Armenia was Ankara’s response to Yerevan’s conflict with Baku and is a major impediment to Armenia’s economic growth. The final issue is Armenia’s call for Turkish acknowledgement that the mass slaughter of Armenians that took place in the waning days of the Ottoman Empire constitutes genocide.

In Yerevan, the steps to normalize relations with Ankara have been met by demonstrations, with protesters (mainly from nationalist parties) numbering in the thousands. The Dashnak party has even launched hunger strikes to mark its disapproval of the negotiations. This backlash could yet prove a significant obstacle—the attempts by former president Levon Ter-Petrosian to hash out a deal with Azerbaijan over Nagorno Karabakh in the late nineties (and his consequent removal from office) are a salutary lesson in the power of Armenia’s nationalist lobby.

But if societal pressure can be held in check, the passage of the protocols by Armenia’s legislators should not prove too great a challenge. Pro-government parties make up an overwhelming majority in parliament, with the opposition Heritage party holding only seven out of 131 seats. With such favorable numbers, Sarkisian’s primary obstacle to ratification is the nationalist backlash.

Turkish officials also will face significant domestic opposition to the protocols, primarily because of the “genocide” issue. The “football diplomacy” begun last year has yielded steady progress in the Turkish-Armenian relationship. Bringing the process to full fruition, however, will require superb political skills and courage in both Yerevan and Ankara.

Source Notes:
(1) “Georgian leader blamed for attempt towards ‘absolute control’ over ministry,” Resonance, 10 Mar 09; BBC Monitoring via Lexis-Nexis.
(2) “Defense minister replaced,” Civil Georgia, 27 Aug 09 via http://www.civil.ge/eng/article.php?id=21398&search=Akhalaia.
(3) Ibid.
(4) “Bacho Akhalaia – Biography,” Civil Georgia, 27 Aug 09 via http://www.civil.ge/eng/article.php?id=21399.
(5) Giorgi Kvelashvili, “Bacho Akhalaia Becomes Georgia’s New Defense Minister,” Jamestown Foundation Blog, 17 Sep 09 via http://jamestownfoundation.blogspot.com/2009/09/bacho-akhalaia-becomes-georgias-new.html.
(6) “Expert sees Georgian cabinet reshuffle as sign of wrangling within ruling party,” Kviris Palitra, 31 Aug 09; BBC Monitoring via Lexis-Nexis.

By Robyn E. Angley (rangley@bu.edu)

~~~~~

CENTRAL ASIA

Uzbek-Kyrgyz relations fall into the trenches
Uzbek-Kyrgyz relations, rocky at best lately, have taken another downward turn over the past few weeks, as the Uzbek government has taken steps to tighten border security even further and in so doing has resorted to rather unneighborly and brazen measures.  This most recent drive to exercise stricter control over incoming traffic from Kyrgyzstan seems to have been sparked by yet another shootout between Uzbek security services and alleged terrorist forces in the heart of Tashkent, just days before the country’s Independence Day celebration.

The Uzbek prosecutor general’s office has stated that three of those killed during the August 29 gun battle had received combat training “at foreign terrorist centres” and were connected to a “series of murders and attempted murders” in Uzbekistan over the past several months.  President Islom Karimov, for his part, has blamed much of this violence on Islamist militants affiliated with extremist organizations located in adjacent states. (1)  The two states that have received the blame for originating these Islamist incursions most often are Kyrgyzstan and Tajikistan; in fact since the attacks in Khonabod and Andijon last May, it is almost exclusively the Kyrgyz government which has drawn President Karimov’s ire.  It should come as no surprise then, that in its report of the most recent incident, the Kyrgyz newspaper Vecherniy Bishkek stated that there had been reports that the militants killed during the operation had Kyrgyz passports. (2)

Although Uzbek authorities do not appear to have substantiated these reports publicly, based on the actions taken by the Uzbek border services immediately following the shootout in Tashkent, it seems clear that Kyrgyzstan once again has been assigned the role of scapegoat.  In preparation for Independence Day celebrations, the Uzbek government already had closed checkpoints on its side of the Kyrgyz border.  However, in the wake of the violence in Tashkent, security services undertook a “Guard Your House Yourself” campaign to recruit local residents for volunteer squads that would assist in patrolling the border, checking passports and even searching the vehicles of anyone trying to enter the country.  As of September 1, 140 such squads had been formed and authorities apparently intended to pursue their campaign until an additional 260 had been created.  Uzbekistan and Kyrgyzstan share an approximately 1,000 km long border, (3) sixty sections of which have yet to be delimited. (4)  Until these stretches of territory have been officially demarcated, both sides are prohibited from setting up new border posts there, a proscription which Tashkent has violated repeatedly.  Following the attacks in Khonabod last June, Uzbek border service personnel began digging a trench and constructing a fence in areas of Andijon Region that border Kyrgyzstan. (5)

Just a scant few months later, Uzbekistan’s border guards resumed their excavation project, this time in the village of Bay-Kyshtak, on the Kyrgyz side of the border. (6)  President Karimov’s administration defended its actions by stating that due to Bishkek’s refusal to respond to “numerous requests” to continue border delimitation talks, the Uzbek side was “forced to unilaterally improve control on disputable border parts with Kyrgyzstan,” and furthermore that “such actions are not designed to infringe on any party's interests but meant to providing order and stability along the border” [sic]. (7)  Dissatisfied with Tashkent’s lack of cooperation the Kyrgyz government suspended all discussions of border demarcation in November 2008, but both sides are slated to resume negotiations on the matter on September 25 at Kyrgyzstan’s Lake Issyk-Kul resort. (8)

Obviously, with Taleban activity once again on the rise not only in Afghanistan, but also in Pakistan and with a corresponding rise in the narcotics trade, all of the Central Asian leaders have cause for grave concern over the issue of border security.  Furthermore, due to the fact that vast sections of Central Asia’s Afghan border are located in areas so mountainous that they are virtually impossible to patrol, a certain amount of illicit traffic is bound to penetrate the border.  Until “order and stability” come to Afghanistan, the issue of border security will continue to plague all of the Central Asian regimes.  However, the roots of the Uzbek government’s dispute with Bishkek and not inconsiderable ill will toward Kyrgyz President Kurmanbek Bakiev seem to go far beyond the topic of border security.  President Karimov seems convinced that Bakiev lacks the competence to control his own country, whether the issue is border safety, illegal grain trading, or hydropower.  The fact that a large number of refugees from the May 2005 Andijon massacre fled to Kyrgyzstan also still appears to be a source of irritation to the Uzbek president.

Karimov’s conviction that Bakiev is unable to keep order in his own house could be one explanation for the Uzbek security forces’ occasional forays into villages on Kyrgyz territory, where they proceed to raid the residents’ houses, ostensibly as part of a security check.  Uzbek security personnel also have been known to enter Kyrgyz territory in order to arrest alleged terrorists and forcibly return them to Uzbekistan for trial.  On September 18, AKIpress reported on one “security check” incident, when armed members of Uzbekistan’s border patrol arrived in the village of Suroo-Tash in Kyrgyzstan’s Osh oblast’ and threatened local residents with retribution, should they continue to report their abuses at the hands of Uzbek border personnel to Radio Azattyk (RFE-RL’s Kyrgyz service).  The villagers, as well as various human rights groups have appealed to the Kyrgyz government for relief from these raids, so far to no avail. (9)

The recent spate of violent incidents in Uzbekistan is certainly cause for concern, but blaming President Bakiev’s administration for them and allowing Uzbek border personnel to treat Kyrgyz territory as though it were their own, can only exacerbate an already tense situation.  The Central Asian leaders will not see any improvement to border security, or to any of the other myriad problems which currently plague their regimes, until they work together, in an at least civil, if not cordial, fashion.  In fact, should the residents of Kyrgyzstan’s border areas become sufficiently frustrated at both Bishkek and Tashkent’s lack of concern over the frequent abuse they must endure from Uzbek border patrol personnel, they may well take matters into their own hands and perhaps form their own volunteer squads to protect the Kyrgyz border from marauding Uzbek security services.

Source Notes:
(1) “CORRECTED: Three militants killed in Uzbekistan clash: officials,” 4 Sep 09, Agence France Presse via Lexis-Nexis Academic.
(2) “"Terrorists" killed in Uzbek operation had Kyrgyz passports – paper,” 4 Sep 09, Vecherniy Bishkek; BBC Worldwide Monitoring via Lexis-Nexis Academic.
(3) “Uzbek volunteers help patrol border with Kyrgyzstan – NGOs,” 1 Sep 09, Central Asia General Newswire; Interfax via Lexis-Nexis Academic.
(4) “Senior border officials of Uzbekistan, Kyrgyzstan to meet in Osh,” 11 Sep 09,. AKIpress; Al Bawaba via Lexis-Nexis Academic.
(5) “Kyrgyzstan voices concern over Uzbek border fence,” 9 Jun 09, 24.kg; BBC Worldwide Monitoring via Lexis-Nexis Academic.
(6) “Kyrgyz Village Stops Uzbeks From Digging Border Trench,” 16 Sep 09, Radio Free Europe/Radio Liberty via <http://www.rferl.org/content/Kyrgyz_Village_Stops_Uzbeks_From_Digging_Border_Trench/1824122.html>, last accessed 24 Sep 09.
(7) “Uzbekistan forced to initiate changes on border with Kyrgyzstan,” 8 Sep 09, Asia Pulse via Lexis-Nexis Academic.
(8) “Senior border officials of Uzbekistan, Kyrgyzstan to meet in Osh,” 11 Sep 09, AKIpress, Ibid.
(9) “Armed Uzbek border guards enter Kyrgyz frontier village of Suroo-Tash,” 18 sep 09, AKIpress; Al Bawaba via Lexis-Nexis Academic.

By Monika Shepherd (moshep@bu.edu)

~~~~~

WESTERN REGIONS

UKRAINE

Ukraine’s president campaigns internationally against his own country
Last week, Ukraine President Viktor Yushchenko seemingly turned against his own country.  Over the course of one week, he implied that the IMF should stop lending to Ukraine, halted an internationally-supported privatization plan, claimed economic recovery is years away, suggested that the country’s gas agreement with Russia can be changed, and implied that the country is too weak to maintain its independence without the support of the West.  It certainly was quite a week.

Many of these statements surfaced in interviews given by Yushchenko surrounding his visit to the opening of the UN General Assembly.  In essence, his message was simple: My country is a really, really big mess and what you’ve been doing to help hasn’t worked.  This sentiment may be shared by some who are concerned about Ukraine’s progress toward reforms and its chaotic political environment, but rarely do presidents join the international critics of their own country.

The comments cannot be characterized as anything but odd, coming from a president who has been in office for almost five years.  Apparently, President Yushchenko is not responsible for anything that has happened in his country since January of 2005.  Moreover, the president appears to be unconcerned about the potentially negative effects that such words could spark.

This is particularly true of his statements regarding the IMF and the gas agreement with Russia.

On 17  September, Yushchenko accused the government of not fulfilling its obligations to the IMF, which agreed earlier this year to provide Ukraine with a loan of $16.4 billion.  It so far has provided a bit over $10 billion of that loan.  “I am very disappointed,” Yushchenko said, “that the policies in 2009 departed so far from the memorandum [of understanding with the IMF].”  (1) He continued, “Neither the World Bank nor the International Monetary Fund did the work that had been foreseen … to shift the government toward reforms.”  The president’s comments followed on those of the deputy head of his administration, Oleksandr Shlapak.  “The IMF will not give us anything by year-end as we are not fulfilling our obligations,” he said. (2)

There is little doubt that Ukraine has failed to fulfill a number of the latest agreed-upon IMF requirements – in particular, raising domestic gas prices to help stabilize energy expenses. However, the IMF and other international groups so far have conducted their work in Ukraine with tremendous flexibility – demonstrating an apparent understanding of the country’s unique political atmosphere.

Prior to disbursing its second tranche earlier this year, the IMF’s Ukraine Mission Chief called the government’s work “encouraging” given the political hurdles it faces.  Ceyla Pazarbasioglu complimented Ukraine Prime Minister Yulia Tymoshenko’s decision to enact several IMF-agreed reforms by direct decree, after the country’s parliament failed to pass the reforms.

It is telling, given Yushchenko’s current criticism, that it was the lack of support from President Yushchenko’s allies in parliament that necessitated the Prime Minister’s use of her power to issue decrees.  When Tymoshenko’s government placed several reforms in front of the parliament—ones dealing primarily with the pension fund and the state gas company—Yushchenko’s loyalists abstained, dooming the measures to failure.  Pazarbasioglu, speaking at a joint press conference with the Prime Minister after her decrees were enacted, explained, “As the prime minister said, perhaps this is the way to go given the political circumstances.”  (3)

It appears, then, that the government was the instrument of reform – however small – during that period.  Earlier, the IMF also had praised the government for its reform of the excise tax system.

So, where was the President during this time?  Why did the president fail to lobby for the passage of the reforms agreed upon with the IMF? 

Earlier this month, as reforms once again were bogged down, Ms. Pazarbasioglu expressed frustration with Ukraine.  "Everyone is saying something different -- the government, the president and the opposition," she said.  (4)  This has led to a halting of most legislative work in the country.

Unfortunately for Tymoshenko, even if the government wanted to pass the reforms, it would be impossible to do so through parliament.  For the better part of the summer and this month, the opposition Party of Regions has blockaded the chamber.  The latest blockade came after an opposition-sponsored bill to raise pensions and the minimum wage was voted down.  Now, party leaders suggest they will allow a reopening of parliament only if lawmakers reverse their opposition to social spending increases.  The government has balked at such demands, and Ukraine’s Deputy Prime Minister Hryhoriy Nemyria told the Wall Street Journal recently that his government intends to hold the line on social spending.  The new commitment comes after significant social spending increases in previous Tymoshenko-government budgets. (5)

It is unlikely that the government will choose to move forward with IMF-requested reforms, such as raising gas prices and other consumer fees in the near future.  With a presidential election scheduled for 17 January, no political leader—including Yushchenko—will risk earning the wrath of the public with such a policy.  Since this particular reform is one of the most important in the government’s agreed-upon package with the IMF, it is unclear how the Fund will respond. 

Will the IMF’s patience continue through the election?  This seems unlikely.  However, should the IMF accede to President Yushchenko’s apparent desire to see the loan suspended, Ukraine could face a total economic collapse – and quickly.  The country was sent reeling by the global economic crisis, as its primary economic engine—metallurgical exports—crashed.  Although most economists suggest the country has “bottomed-out,” the banking sector remains precarious, the deficit is expected to explode to at least ten percent and the country’s public debt is high.  The Naftohaz gas company is in the process of restructuring $1.6 billion in Eurobonds, and—although the President seems unaware of this fact—international investment markets depend on IMF signals in their decision-making.  Should President Yushchenko get his way, his country’s citizens likely will be the biggest losers.

Luckily for the government, the IMF deal is not the only one that President Yushchenko is criticizing.  He also has heavily disparaged the Tymoshenko-negotiated 2008 Ukraine-Russia natural gas deal.  Yushchenko repeatedly has suggested that Russia could unilaterally change the terms at any time. “I don’t think [the] agreement …. added any stability to gas supplies to Europe,” he said recently. (6) These types of statements are troublesome for other foreign leaders, particularly those in the EU who depend on Ukraine’s transit of Russian gas to their countries.  Any suggestion of a potential new Ukraine-Russia gas “war” is consistently met with irritation – a good amount of it directed toward Ukraine.

For her part, Tymoshenko says the President’s statements are simply untrue.  But, since the initial ten-year transparent agreement has been amended by mutual agreement several times, it is impossible to know whether either country has the right to enact major changes unilaterally.  Regardless, for the first time since independence, Ukraine has paid its gas bill on time and in full for the entire year, thereby negating Russian complaints.  There also appears to be a provision with clear formulas for gas pricing based on market conditions in the contract.

It is difficult to understand what Yushchenko hopes to gain with his criticism – most of which was carried in English-language, Western papers.  Although he is running for re-election, he stands little chance of succeeding; polls now give him around three percent of the vote.  Tymoshenko is doing better, but not particularly well, at around 15 percent.  Opposition leader and former presidential candidate Viktor Yanukovych, on the other hand, stands at around 25 percent.  Yanukovych’s strategy largely has been to remain quiet, particularly on the most difficult issues facing the country.  Perhaps it is a strategy that might provide some benefit to President Yushchenko.

Source Notes:
(1) “Ukraine’s Yushchenko disappointed with the IMF’s lenience,” Reuters, 17 Sep 09 via www.kyivpost.com.
(2) “Ukraine May Need Measures to Offset Financing Risks, IMF Says,” Bloomberg, 9 Sep 09 via www.bloomberg.com.
(3) “Tymoshenko bypasses parliament for IMF loan,” The Financial Times, 14 Apr 09 via www.unian.net.
(4) “Political Rivalries Put Ukraine's Economy at Risk,” The Wall Street Journal, 9 Sep 09 via www.wsj.com.
(5) Ibid.
(6) “Yushchenko Backs Naftogaz, Doubts Ukraine’s Russian Gas Deal,” Bloomberg, 18 Sep 09 via www.bloomberg.com.
           
By Tammy Lynch (tammymlynch@hotmail.com)

________________________________________________

To subscribe or unsubscribe to Perspective and The ISCIP Analyst, send a request to buiscip@bu.edu.  We welcome your responses.For back issues of Perspective and The ISCIP Analyst, or information about the Database and the Institute’s other work, please see our web site at <http://www.bu.edu/iscip/>. Our database <http://www.bu.edu/iscip/database.html> describes in detail major events, trends, policies, institutions, and personalities from the Gorbachev period onward. A broad range of materials from various sources has been utilized to provide a rich collection of information, commentary, and analysis on post-Soviet affairs.  Beyond the members of the Institute and its Research Associates, the material is accessible to members of the Boston University community.   Recipients of ISCIP publications may be eligible to become ISCIP Research Associates. If you would like information on applying for Research Associate status or have other questions or comments, please contact us by e-mail <buiscip@bu.edu>, fax (617) 353-7185, phone (617) 353-5815, or by writing to us at the Institute for the Study of Conflict, Ideology & Policy at Boston University, 141 Bay State Road, Boston, MA 02215.

 




 About Us Staff Contact Home Boston University