Tymoshenko Adds Ukraine Political Risk to Tentative Calm

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Former Ukrainian Prime Minister Yulia Tymoshenko addresses a crowd in Independence Square, Kiev, after being freed from prison on Feb. 22, 2014. Close

Former Ukrainian Prime Minister Yulia Tymoshenko addresses a crowd in Independence... Read More

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Photographer:by Jeff J Mitchell/Getty Images

Former Ukrainian Prime Minister Yulia Tymoshenko addresses a crowd in Independence Square, Kiev, after being freed from prison on Feb. 22, 2014.

Yulia Tymoshenko’s brand may have been overtaken by Ukraine’s events.

Wreathed in her signature blond braid, Tymoshenko, the 53-year-old firebrand former premier, was visibly worn out by more than two years in prison as she addressed thousands in Kiev from a wheelchair on Feb. 22. Unlike in 2004 when she galvanized crowds in the Orange Revolution, the reception was mixed: chants of “Yulia, Yulia!” turned into muted applause as some people walked away from Independence Square, known as Maidan.

Long a symbol of political defiance against the regime of Viktor Yanukovych, her comeback was upstaged by days of fierce clashes that gripped Ukraine’s capital. With a tentative calm restored in the second-most populous post-Soviet nation following its deadliest week since World War II, Tymoshenko brings another ingredient to the volatile mix on the streets even as she ruled out becoming premier.

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“She will add spice into Ukraine’s political borscht,” said Volodymyr Fesenko, head of the Penta Political Analysis Center in Kiev. “Her comeback carries huge political risk for Ukraine. Ukraine is in need of a renewal of the political class and political leaders. To allow Yulia to lead will take us back. For many on Maidan, she -- like Yanukovych -- is a symbol of the past and of the disappointment in the Orange Revolution.”

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Ukrainian President Viktor Yanukovych stands in the Presidential Palace on February 21, 2014, in Kiev, Ukraine. Close

Ukrainian President Viktor Yanukovych stands in the Presidential Palace on February 21,... Read More

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Photographer: Thomas Trutschel/Photothek via Getty Images

Ukrainian President Viktor Yanukovych stands in the Presidential Palace on February 21, 2014, in Kiev, Ukraine.

2009 Deal

In a battle that dominated the last decade of Ukrainian politics, Russian-backed Yanukovych gained the upper hand when Tymoshenko was handed a seven-year prison sentence in October 2011 for harming her country by signing a natural-gas supply and transit accord with Russia in January 2009.

While Yanukovych has said the contract caused $12 billion of losses in 2010-2012, Tymoshenko denied any wrongdoing and said the case was engineered to silence the opposition before parliamentary elections. The European Union deemed the verdict selective justice.

The Cause of Unrest in Ukraine

While in prison, Tymoshenko alleged she was punched by three men in 2012 and went on a hunger strike that lasted two-and-half weeks until she was transferred to a hospital for treatment supervised by German doctors.

Her time in jail has taken a toll and may have been a factor in her request yesterday not to be considered for prime minister, according to Tim Ash, chief emerging-market economist at Standard Bank Group Ltd. in London.

“I would think that physically she is not up to such a demanding job in the short term,” Ash said by e-mail. “That said, she clearly wants to stay in politics, and I would expect she has her sights set more on the presidency.”

‘Gas Princess’

A native Russian speaker born in the eastern city of Dnipropetrovsk, 450 kilometers (280 miles) southeast of Kiev, she served as chief executive officer of Ukrainian Petroleum Co. after the Soviet Union collapsed in 1991, heading a company that later became Ukraine’s biggest importer of natural gas from Russia and Central Asia.

Local news organizations nicknamed her the “Gas Princess” and claimed that through her role she made millions of dollars. She never commented on her finances.

Appointed deputy prime minister for energy in 1999, Tymoshenko was removed from government in January 2001 following accusations of fraudulent gas imports, tax evasion and bribery. She said the allegations were orchestrated by businessmen who wanted to reverse changes she had made to the energy industry.

While she was arrested twice, all the charges were eventually dropped.

Peasant Braid

Tymoshenko remade her political image, perfecting her Ukrainian and invoking a traditional hairstyle with a plait curling around her head. Elected to parliament in 2002, she gained international fame two years later, when she joined Viktor Yushchenko in leading leading the protests that overturned the rigged presidential election of Yanukovych.

She became prime minister in 2005, only to be dismissed seven months later because of disagreements over economic policy. Years of squabbles among the Orange Revolution’s leaders cleared the path for Yanukovych’s party to gain control of parliament in the 2006 elections and Yanukovych himself to become president in 2010.

Sentenced to jail the following year, Tymoshenko became a thorn in the president’s side as he negotiated a free-trade agreement with the EU. Her incarceration was criticized by the U.S., EU and Russia as politically motivated.

Trade Deal

Yanukovych’s move to suspend talks over the EU pact triggered the protests that culminated in deadly clashes last week. The day parliament ousted Yanukovych for his role in the violence, Tymoshenko was freed from a penitentiary hospital in Kharkiv -- the city on the Russian border where the ousted president first fled.

Long seen as the country’s most prominent inmate, her public standing didn’t emerge unscathed. A survey of eligible votes showed Tymoshenko was the country’s third-most popular politicians with 13.9 percent, lagging almost 7 percentage points behind Yanukovych and Vitali Klitschko, the former world boxing champion, who had 16.1 percent backing. The study, conducted by the Kiev International Institute of Sociology and pollster Socis Jan. 24-Feb. 1, had a margin of error of 2 percentage points.

Following her release, it took Tymoshenko less than a day to begin downplaying her presidential ambitions. Following an initial announcement to journalists that she would run in an early election on May 25, she was less definitive about her plans yesterday as she met with foreign ambassadors.

“Now is not the time to talk about this,” Tymoshenko was quoted as saying by her spokeswoman, Natalia Lysova, by phone.

Maidan Speech

As lawmakers worked to dismantle the Yanukovych regime, she arrived on Maidan at a charged moment. While the protesters had chased Yanukovych away and took control of the city, they also mourned their dead, coffins displayed on the square as people paid their respects.

In an emotional speech, Tymoshenko acknowledged the sacrifices that made her release possible. Choking back tears, she said Ukraine would only be free when “everyone bears a responsibility for what they have done” and praised the “heroes” behind the upheaval that swept away Yanukovych’s regime.

“You changed everything -- not the politicians, not the diplomats, you changed the world,” she said.

Not everyone on Maidan was convinced. With the economy in free fall, Ukraine needs a technocratic “manager,” according to Andrei, who said he goes by a nickname, Medved, or Bear, and led a group of fighters taking part in the clashes with police.

‘Catastrophic’ State

“The country is on its knees,” he said. “Only a manager will raise it up, someone who knows what to do.”

Gross domestic product shrank in three of four quarters last year on an annual basis. In 2004, it expanded an average of more than 12 percent every quarter. Acting President Oleksandr Turchynov yesterday said the country was in a “pre-default” situation as the economy is in a “catastrophic” state.

Tymoshenko’s speech on Maidan was met with a lukewarm welcome also because everything in Ukraine was overtaken by events on the ground, leaving politicians to catch up to a changing reality.

While cheering her release, Nikolay Malinovsky, a 41-year-old entrepreneur, says Tymoshenko remains part of the old guard.

“Rest up, collect your strength, become the revolution’s muse -- but at a distance,” Malinovsky said. “During the last three months, the country’s changed. It’s changed a lot in the past month. And changed drastically over the last week.”

To contact the reporters on this story: Daryna Krasnolutska in Kiev at dkrasnolutsk@bloomberg.net; Ilya Arkhipov in Moscow at iarkhipov@bloomberg.net

To contact the editor responsible for this story: Balazs Penz at bpenz@bloomberg.net

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