Ukrainian President’s Nominee Picks Up Support for Premiership

  • Parliament speaker nominated ahead of Finance Minister Jaresko
  • Lawmakers reconvene next week in Kiev to approve new premier

Ukrainian Parliament Speaker Volodymyr Hroisman, nominated by President Petro Poroshenko’s party to head a new government, received the backing of ex-premier Yulia Tymoshenko’s group as he seeks to form a new government capable of guiding the country out of a political tumult that’s halted the flow of international financial aid.

The Batkivshchyna party urged Prime Minister Arseniy Yatsenyuk to resign, one of its lawmakers, Andriy Kozhemyakin, told reporters in Kiev on Friday. Hroisman, who’ll present his governing program later in the day, prioritized restarting cooperation with the International Monetary Fund, saying Ukraine must “flawlessly” implement its $17.5 billion bailout, on hold since infighting consumed the government. A majority of lawmakers must approve his appointment, with the legislature set to reconvene Tuesday. Yatsenyuk, who must also step aside, said he’d “accept any decision.”

If confirmed, Hroisman would take charge amid a volatile political environment, with Ukrainians and the nation’s foreign backers losing patience over delays in fighting corruption and modernizing the economy after a street revolution calling for European values. Yatsenyuk’s authority was shaken last month when top reformers left his cabinet and two parties quit the coalition in a flurry of graft accusations. The economy is in the midst of a fragile recovery following 1 1/2 years of recession.

“The most important thing for Ukraine is to have one voice to the lead the country out of its economic abyss,” said Simon Quijano-Evans, chief emerging-markets strategist at Commerzbank AG in London. “Investors are prepared to hold the country’s bonds but ultimately that needs coherent policy that guarantees a continuation of reforms and the crucial IMF program.”

Yields Climb

Ukrainian government bonds and the nation’s currency declined after news of Hroisman’s nomination. The yield on debt due 2019 rose three basis points to 9.914 percent, while the hryvnia, which has already slumped 8.3 percent against the dollar this year, retreated a further 0.2 percent, data compiled by Bloomberg showed.

Hroisman has been parliament speaker since November 2014, serving before that as a deputy prime minister under Yatsenyuk and mayor of the city of Vinnytsya. His appointment, ahead of candidates such as U.S.-born Finance Minister Natalie Jaresko, would consolidate Poroshenko’s grip on power.

In a sign Jaresko may not be a member of a Hroisman-led government, former Slovak Finance Minister Ivan Miklos was named by the parliament speaker as a possible ministerial appointment. There was insufficient support in parliament for an earlier proposal under which Jaresko would head a government of technocrats, according to Lutsenko. Jaresko’s office wasn’t immediately available to comment.

‘Quality Team’

“We should create a professional government, with political support from parliament, that will be responsible, transparent, and effective,” Hroisman, 38, told reporters in the capital, Kiev. “It’s very important to form a quality team. People who join the government must have an impeccable record.”

In announcing Hroisman’s candidacy, Yuriy Lutsenko, who heads Poroshenko’s party in parliament, warned of the dangers of letting the political uncertainty persist. Four parties may unite to form a new ruling coalition in the legislature, he said.

“If we don’t resolve the political crisis next week, the only way out is through early elections, which carries a huge threat of political and economical destabilization,” Lutsenko told reporters.

Oleh Lyashko, whose Radical Party is considering rejoining the ruling coalition, played down Hroisman’s nomination.

Parliamentary Backing?

“When we speak about a candidate for the prime minister’s job, this is one of the proposals,” Lyashko, whose party controls 20 of parliament’s 450 seats, said Thursday. “It’s not a fact that Hroisman will be prime minister. It’s not a fact that Hroisman will be backed in parliament.”

Poroshenko and Yatsenyuk emerged to lead Ukraine after a popular uprising two years ago ousted the country’s Kremlin-backed president, Viktor Yanukovych. Having climbed out of recession, restructured $15 billion of debt and signed a pact to end the armed conflict against pro-Russian separatists in eastern Ukraine, Poroshenko’s team splintered over efforts to stamp out corruption.

“I will accept any decision that will stabilize the situation and that will allow the country to move forward,” Yatsenyuk said at a government meeting in Kiev on Friday. “Gather 226 votes, show the Cabinet, its program and real coalition that will implement this. Otherwise support this Cabinet of Ukraine.”

Before it's here, it's on the Bloomberg Terminal. LEARN MORE