New man at MinFin closes Yanuk's grip on state finances

The sober-minded 'Kommersant' runs a story today entitled 'Financial assistance', about the new 38-year-old Minister of Finance, Yuriy Kolobov.

Below are some portions of the article:

A powerful ally of the National Bank has appeared in the government. Yesterday, the President appointed first deputy head of the National Bank of Ukraine, Yuriy Kolobov as Minister of Finance.

According to experts, he will be responsible for the refinancing of debt, and preventing social benefits problems springing up on the eve of parliamentary elections. Political analysts believe that his appointment now gives the President full control of the country's monetary and fiscal policy.

The post of the Minister of Economic Development and Trade is still open. The main contender, Petro Poroshenko, met the president last week and has now to submit a plan for the development for the economy.

The head of the parliamentary committee on finance, banking, tax and customs policy, Vitaliy Khomutynnyk (PoR) called financier Mr. Kolobov a professional with extensive experience in banking. "He knows the problems of the financial system from the inside. As the first deputy chairman of the National Bank, Yuriy Kolobov attended our committee meetings and we had a constructive relationship. I think, in his new position he will also be effective," said Khomutynnyk.

Mr. Kolobov has worked in the National Bank about a year before that held senior positions in Ukreximbank, BTA Bank and Oshchadbank. His career before 2008 is almost unknown.

According to economic experts, in his new position Mr. Kolobov's first task is to fulfill obligations and eventually repay debts of up to $100 billion, a portion of which have to be repayed by the summer. [BTW Much more on this here: http://www.economonitor.com/blog/2012/02/staring-into-the-ukrainian-economic-and-political-abyss/ ]

His predecessor, Valeriy Khoroshkovsky, last week said that Ukraine would be able to fully repay foreign debts, even without assistance from the IMF.

Director of economic programs of the Razumkov Centre, Vasyll Yurchishin doubts whether further IMF lending will take place: "The IMF does not like to give money before elections."
Kolobov has to find sources of funding to improve social welfare standards - increases of which will become an integral part of autumn's parliamentary election campaign. "If he agreed to head the Finance Ministry, it means he knows what he has to do," said one commentator.

Others add that the the new finance minister will "find common ground with the banks and "persuade" them to actively buy government bonds".

"Foreign borrowing is now closed, leaving only internal resources - and these resources are primarily the money of banks. If practices of the mid-'90's are revived when the sale of government bonds was carried out in close relationship between the Treasury and the banks, a substantial increase in the flow of money to buy hryvnia and foreign currency government bonds can be expected. At that time a system of "manual control" was utilised whereby banks were interviewed, after which they could not refuse to buy government bonds. They were given a direct recommendation to buy, so that there would be no problems" according to a 'Liga.net' source.

Political analysts also believe that the appointment of 'their own man' to this key ministry finally firmly closes the president's circle of control over public finance income and expenditure.

National Bank of Ukraine chairman Sergey Arbuzov is the son of Valentina Arbuzova, who heads the VseUkrainskiy development bank, owned by the president's son, Alexander Yanukovych.

34-year-old Arbuzov and Kolobov share spectacular common career trajectories.

Viktor Yanukovych has thus concentrated all the financial, monetary and fiscal policies in the country, according to the director of the Institute of Global Strategies Vadim Karasev.

"The [newly] constructed financial vertikal should now bolster the power vertikal, cutting off any lobbying efforts to control the budget", he said. This is especially true on the eve of parliamentary elections.

The article includes a cartoon captioned "He knows how to find solutions to problems, and senses where the financial streams are" It shows a tiny [offshore?] island with half-buried money in the sand... suggesting Yanukovych now has all of the levers of power necessary to put the squeeze on the offshore accounts in which Ukraine's richest oligarchs/politicians stash their loot.

Will Kolobov have any success in all of this? My hunch is not much.. Most banks are in a pretty anaemic state right noww...drawing a cash transfusion from them is not a good idea.

And squeezing your sponsors..?

Yanukovych unconcerned about Ukraine's isolation

The British Foreign and Commonwealth Office commented on today's 4 year sentence handed down to former Ukrainian Interior Minister, Yuriy Lutsenko thus : "The apparent political motivation behind the trial calls into question Ukraine’s commitment to a closer relationship with the European Union and runs counter to fundamental EU principles of democracy and a transparent and fair judicial process"

Similar reactions have been voice by other European capitals and multigovernmental institutions.

New Secretary of the NSDC, Andriy Kluyvev, when asked today in Brussels about Yulia Tymoshenko's imprisonment, admitted it had had a negative impact on EU-Ukraine relations, but declared unapologetically : 'criminal responsibility for crimes committed was irreversible.'
[BTW, Klyuyev's recent demotion from vice PM has caused some irritation in Party of Regions']

Clearly, Yanukovych and his pals are totally unconcerned by this negative impact - they intend to gain ever-greater control - their critics can "blow it out of their a**".

LB.com's Sonya Koshkina describes the emergence of what she calls a new 'Cold war'.
Here's a precis of some of the point she makes:

During 2010 and most of 2011 many in Europe and Washington lived under the illusion that Yanukovych dreamt of defining his place in history as a great reformer and Euro-integrator. However, as a result of the Tymoshenko and Lutsenko trials, and 'the leader's' broken promises to his European interlocutors, this illusion has been shattered. There is now serious talk about application of sanctions against some Ukrainian individuals in the Europarliament.

Relations with the USA have also become frosty - Yanukovych received a final warning from Hillary Clinton in Munich several weeks ago, but despite this, Lutsenko was today sentenced to four years inprisonment. The US ambassador had previously been denied the right to visit Tymoshenko in prison and new criminal proceedings have been opened against her too.

According to Koshkina, after Munich, the Presidential Adminstration started thinking seriously about Autumn's parliamentary elections.

In order to minimise the risk of losing, the following strategy has been devised:

Conducting a campaign of maximum pressure against the opposition to dissuade as many as possible of their candidates from standing for election.

Maximising economic pressure, e.g. by the tax authorities, on major businessmen who would be prepared to fund an opposition election campaign [this process is already well under way].

To manipulate the election laws and 'deprive the opposition of oxygen'.

If these measures do not ensure a favourable result, the elections could be postponed indefinitely.

It has been made clear to Yanukovych that if Tymoshenko and Lutsenko are not allowed to participate in the Autumn elections, they will not be considered valid in the West, so why bother holding them at all?

In order to compensate for the huge deficits which would have been filled by no-longer available overseas borrowings, those at the top of Ukraine's 'Forbe's list' are to be squeezed. Quite what the reaction of these guys will be, Koshkina does not say...

China could also be a source of funds, if Ukraine's farmlands were provided as collateral.

Reshuffles will not help Ukraine

I can recommend this OSW article on the recent reshuffles in the Ukrainian government as prelude to Autumn's parliamentary elections in the country.

However, the article claims that for Andriy Klyuvev, who was recently demoted[?] from deputy PM to Secretary to the post of the National Security and Defence Council, [See previous F.N. blog on this topic], the "main task at the NSDC will be to prepare the Party of Regions for the elections this autumn, which proves that he is still trusted by Viktor Yanukovych."

In Friday night's big TV interview, Yanukovych said that Klyuyev will not be heading the Party of Regions' election headquarters even though he was one of the main architects of this political project.

The OSW article claims "A parallel goal for President Yanukovych is to contribute to the growing significance of ‘the Family’ and at the same time to preserve a certain balance of influences of individual oligarch groupings within his inner circle and to build his position as an arbiter between them. The oligarchs are too strong for the president to be able to rule without giving due respect to their interests. On the other hand, allowing one of the oligarch groups to gain a clear advantage over the other poses the risk of weakening the president’s position.." and the emergence of conflicts.."

The weakening of Klyuyev and 'confederation of Donetsk clans' in favour of 'the Family' and the RosUkrEnergo lobby could turn out to be a major miscalculation.

In another 'L.B.' article, Vitaliy Pornikov also discusses the recent reshuffle, but he concludes: "To overcome these [economic] problems, redistribution [of power] amongst the clans is not what is required. Nor is the victory of one group over another. And not even the appearance of a decorative professional [like Poroshenko] in the government. Even a supra-party government of professionals will not now save the country.

To overcome the problems, a new government is required, one that is not only merely competent, but one that has gained trust. A government that will be trusted both inside the country, in the West and in the East.

Opinion hardening - Tymoshenko is being maltreated

After medical investigations and scans last November it was generally agreed that the imprisoned former PM Yulia Tymoshenko was suffering from a herniated disc in her spine.

Treatment for this frequently painful condition varies from 'Rest and Activity Modification', 'Ice and Heat Application', 'Therapy'...prescription of various medications...steroid injections ...through to various surgical procedures, depending on the condition of the patient and the diagnosis of physicians.

I have posted two previous blogs [here and here] about what I consider Ukrainian authorities' demonstratively brutal treatment of Tymoshenko.

Several days ago she was examined by a team of German and Canadian doctors - but as usual, the Ukrainian authorities have tried to muddy the waters.

Attempts by Ukrainian Minister of Health and PoR spokesmen to 'rubbish' the three Canadian doctors who examined her in advance of their diagnosis being made known prompted a strong reaction from the Canadian Ambassador.

Some PoR spokesmen have suggested that Tymoshenko is faking her illness, adding that maybe it would be good idea if a psychiatrist was also summoned...

Statements from Ukraine's penitentiary service usually declare that Tymoshenko's state of health is satisfactory. and that no surgical procedures are necessary.

However, they recently admittted they cannot exclude the possibility that an operation may be required to treat her condition .

The only comment thus far from the two emininent Berlin doctors has been: "The sitation with the state of her health is very serious."

Today 'Kyiv Post' reports: [Zuzana] Roithova, former healthcare minister of the Czech Republic and a member of the European People's Party which has long supported Tymoshenko, visited Kiev this week and saw part of Tymoshenko's medical records dating back to November 2011.

"(The record) clearly shows that even then the medical findings concerning the lumbar spine area required proper treatment with anaesthetics, followed by appropriate rest and a further decision on possible surgical solution following more examinations," Roithova said in a statement.

"That would have been the standard procedure. Instead, however, she was deprived of her supportive crutches, she spent endless hours interrogated and was even temporarily deprived of the painkillers."

Roithova said she would "be taking much more seriously the concerns of Tymoshenko's family, who fear that Yulia Tymoshenko could be exposed to toxic substances so she would succumb to the pressure upon her".

"Yulia Tymoshenko's health raises concerns that she has been maltreated while being in prison," she said."

Apart from sadistic pleasure and cruel demonstration to intimidate politicial enemies, I fail to see what else Yanukovych and his thugs intend to gain from this..

Ossetian presidential election turmoil

There have been very few reports in the mass media about the latest turmoil in South Ossetia. Below is a small portion from an excellent report by Anna Nemtsova published in 'The Daily Beast'

"A few months ago, the republic [of South Ossetia]'s former minister of education, Alla Dzhioyeva, was joyfully celebrated as the first woman to win a presidential election in the long-suffering local conflict zones of the Caucasus.

During the election, Dzhioyeva—an independent candidate—and her team had opened up an acute discussion of the Kremlin's failed promises to reconstruct the republic, of massive bureaucratic corruption, and billions of rubles that disappeared on the way to South Ossetia.

Excited about the idea of the first free election after the August 2008 war, more people voted for Dzhioyeva than the Kremlin-backed candidate. She received a copy of the election commission report confirming that she had won by a 16 percent margin. Moscow had drastically miscalculated.

The drama that followed brought blood and violence to the enclave that Russia went to war to protect. Instead of letting the ruined republic enjoy their independent candidate, a local court annulled Dzhioyeva's victory.

[Note: Some reports say their Supreme court annulled the election result because of 'irregularites'... Dzhioyeva was then drawn into negotiations with acting president, the Russian Vadim Brovtsev - who was nominated by the Kremlin despite having no previous connection to South Ossetia. But Brovtsev failed to keep his side of their agreement...LEvko]

This pushed thousands of her supporters to the streets to protest. "An active civic position and the sense that their opinion was being ignored brought people out," said Varvara Pakhomenko, an analyst with International Crisis Group. "By now South Ossetians probably feel they have become hostages of recognition."

To stop the uprising, the Moscow-backed acting president ordered Dzhioyeva arrested. In early February, dozens of men in balaclavas allegedly broke into her house and beat Dzhioyeva's closest family, supporters, whoever tried to protect her. The last that her brother Konstantin remembered of that night's horror, he says, was his sister's unconscious body being thrown into a military truck...."

More at the link above.

Journalist Vataliy Portnikov describes the situation thus:

"For Georgia, South Ossetia is occupied territory. For residents of South Ossetia it is an independent republic. But in reality it is a colony of Russia; just a colony for use as a propaganda demonstration of their own greatness.

This is why the colony is managed by an emissary from Moscow. And no matter how the Ossetians vote, the only president there will be one that is approved by Moscow. This is why all the stolen money for restoring the broken roads and emergency facilities is stolen, and why there is so much poverty and hopelessness.

People live this way in a many regions of Russia intself. But at least there no one cheats them or says that they can decide something."

P.s. Nemstova's article was elsewhere entitled: 'Did Kremlin thugs attack Alla Dzhioyeva?'

All of the above has got me thinking about Yanukovych's latest appointments... and parliamentary elections later this year in Ukraine..

Dissapointed Klyuyev's role may be pivotal at election time

President Yanukovych's transfer of one of his closest PoR colleagues, 'partner in crime', Andriy Klyuyev, from deputy PM to Secretary of the National Security and Defence Council, has caused much speculation. Yulia Mostova in 'Dzerkalo Tyzhnya' suggests Klyuyev's first reaction would have been that of dissapointment and dismay. He was one of the favourites to step into PM Mykola Azarov' shoes when he eventually goes, and possibly may have been promised the top cabinet job by 'el presidente' himself in the past.

Mostova suggests that the president is counting on the 'demoted' Klyuyev to 'prove himself' and create an impact in the oncoming parliamentary election campaign, which in any case is predicted to be very tough and dirty. The reward would be high.

Klyuev is a very bright boy - has cordial contacts, even with leaders of the opposition. He is well thought of in Europe - he had done good work behind the scenes preparing the as-yet-uninitalled EU/Ukraine Association Agreement, so his transfer to the NSDC was a puzzlement to his EU interlocutors.

'Tyzhden' speculates in an unpublished article [see previous blog] that if the results of the parliamentary elections scheduled this Autumn are poor for the ruling authorities, leading oligarchs will propose the president stands down in the 2015 presidential elections, and under a guarantee of immunity, nominates another candidate. [Andriy Klyuyev and his brother also regularly figure in lists of wealthiest Ukrainians.]

Yanukovych may well feel the only sure guarantee of avoiding any trouble would be to remain in power - hence his determined efforts to ensure the Ministry of Internal Affairs [i.e. police], Ministry of Defence, and Security Service of Ukraine are headed by firm loyalists. Klyuyev and the NSDC will be pivotal if the president postpones the elections and declares some kind of martial law situation, .

Yanukovych preparing several scenarios in lead-up to Autumn VR elections?

During last Friday's 'ShusterLive' show, the transfer of former deputy PM Andriy Klyuyev to the chair of the National Security and Defence Council head by presidential decree was discussed. For over 10 years now Klyuyev has probably been Party of Regions' smartest political manager and organiser.

Chief-editor of the LB.ua site, Sonya Koshkina expressed the view that in his new position Klyuyev will have greater opportunity to successfully manage Party of Regions' campaign for the parliamentary election scheduled to take place next Autumn, and would also be ideally placed to manage the country's security forces in order to produce the 'required election result'. [PoR's ratings are currently in the low to mid teens... and falling.]

But, in her opinion, there is a possibility parliamentary elections could be cancelled or be postponed indefinitely. The NSDC, in close collaboration with the President, could even declare a state of emergency in the country.

Koshkina pointed out that in Europe opinion is hardening that if Yulia Tymoshenko is not free to take part in the elections then they will not be considered valid in any case...so why bother?

[Note: Messing about with election dates is not new:

On February 16, 2010 the Verkhovna Rada cancelled all Ukrainian local election dates original set for May 30, 2010. A new date was not set but Members of Parliament expected new local elections in the spring of 2011. On April 2, 2010 the Verkhovna Rada set early local elections in a number of cities, towns and villages for June 20, 2010. According to opposition lawmaker Mykola Katerynchuk (Our Ukraine–People's Self-Defense Bloc faction) the voting results proved that the Party of Regions intends to extend its influence over local government bodies, as the faction did not support elections in any of those regions where they already had a majority.

Late April 2010 President Viktor Yanukovych expected local elections in Ukraine to take place in 2011. Late May 2010 Yanukovych stated that local elections should be held next autumn. Yanukovych also called for these elections to be based on the majority representation system and stressed the need to adopt the relevant laws.

On July 1, 2010 the Verkhovna Rada scheduled the election for Sunday, October 31, 2010. On July 11 lawmakers approved the bill on the procedure for holding the elections. Source

In April 2007, in an attempt to resolve a political crisis in Ukraine, President Yushchenko issued a constitutionally highly dubious decree, and dissolved Ukraine's parliament. Fresh elections took place at the end of September that year. Source]

The latest edition of 'Tyzhden' weekly runs an article entitled: 'Cadres decide everything?' "The new appointments heading the Security Service of Ukraine [SBU] and Ministry of Defence are evidence the president does not trust the 'endless cadre of reserves' that Party of Regions traditionally boast of." The article predicts other figures, distant from PoR but 'recommended by authoritative members close to president', may soon be appointed to other strategically important positions. In other words, 'Lidder' as he is called in PoR correspondence, is distancing himself from his own party and building his own power 'vertikal'..there as rumblings of internal discontent already amongst senior party paymasters.

'Tyzhden'also runs another article entitled 'They are preparing to give [their opponents] one in the face' which describes how the authorities intend to use 'adminresurs' manipulations and falsifications in the run-up to the 2012 parliamentary elections. Their intention to do this was clearly signalled by Roman Zabzaliuk's bribery recordings [ see previous F.N. blog]

Unfortunately these two articles can only be read on the net at the links above. 'Tyzhden' has been withdrawn from sale for reasons, as yet, not explained...

p.s. The prosecutor-general says his office is not compentent to investigate alleged bribery of deputies in the V.R. In other words, carry on as normal...

Yanuk snubbed by Afghan vets

"Ukrainian veterans of the 10-year Soviet Afghan war, angry about proposed cuts to payouts, snubbed President Viktor Yanukovych on Wednesday, turning their backs on him at a ceremony to mark the 23rd anniversary of the Soviet withdrawal from Afghanistan."

These veterans were also most aware that Yanukovych did not serve any duty in what was then a conscript Soviet army.

The reason?

He was serving time elsewhere - in a penal colony for crimes of violence....

The rich get richer, the poor get poorer

The sober-minded 'Kommersant' newspaper reports:

"IMF warns of a hidden threat - Reduction of budget deficit recommended for Ukraine

Regeneration of the Ukrainian economy is in danger, warns the International Monetary Fund.

This can be avoided only by tightening fiscal policy - in particular, higher taxes and gas prices, as well as a transition to a floating exchange rate.

The recommendations of the IMF have become much tougher, since a deterioration in the payments balance in Ukraine has become apparent, experts admit."

Cf. Yanukovych's super-luxury A-319 Airbus with marble and gold bathroom fittings etc. etc...[photos here ] - cost $90m...Not that he will be using it much..now he is being shunned by western leaders..

Oh, and no more IMF credits without improvements in democratic standards...

Bribes transcript: "We are working for the president. I don't care about anything else.."

On one of the last days of 2011, 'Den' reported: "... Roman Zabzaliuk quit the [BYuT] fraction. ...This news was a shock both for his colleagues in the party and many journalists. Unlike a lot of his colleagues, Zabzaliuk honestly spent the whole summer near the Pechersk Court [where Yulia Tymoshenko was being tried]. In the parliament he was thought to be close to Turchynov and Kozhemiakin. In the political environment they thought that if his friend headed the fraction, Zabzaliuk would quickly come out on top. Some even predicted that he could become the deputy head of the fraction.

“Roman Zabzaliuk has been on the sick leave for two weeks. When he recovers he will give commentaries. He personally asked me about it,” leader of the [BYuT] fraction Andrii Kozhemiakin said. Zabzaliuk did not pick up the phone those days. When this article was edited the motifs [sic] of his leave were still unclear."

Last Wednesday Zabzaliuk's motives did become clear when, at a press conference, he revealed his 'defection' was in fact part of 'sting' operation. He produced recordings of conversations between himself and Ihor Rybakov, head of ‘Reforms for the Future’ parliamentary group, and alleged Rybakov bribed him to work 'for the other side'. The cynicism of Rybakov is astounding even though rumours of systematic bribing of of opposition deputies had been widespread.

'KyivPost' has posted several articles on this scandal.

Most Ukrainian TV channels and newspapers have downplayed the story, and the ruling authorities' line seems to be: 'both parties are discrediting parliament - Zabzaliuk may be guilty of soliciting a bribe or entrapment. PoR spokesmen say Zabzaliuk should give the money back..thus confirming money had changed hands, and even hinted that he may be charged for taking a bribe..

The two biggest political discussion shows last Friday ignored the topic - almost certainly as a result of pressure from 'vlasti' - a clear example of censorship of what should be the biggest story of the year so far.

Nevertheless transcripts and the audiofiles are readily available. Zabzaliuk has been interviewed on RadioSvoboda, on the minor independent TVi channel, and elsewhere. The recordings are clear, and excerpts can be widely heard on 'the net.'

Rybakov has not claimed the recordings to be faked; rather oddly, he claims he was merely helping a friend who needed the money for a medical operation..

But the most damning conclusion that can be drawn from these excerpts is that it appears the president himself and as well as his administration approved the bribing of opposition politicians and the organisation of opposition 'sleepers', in preparation for massive election fraud during Autumn's parliamentary elections.

LEvko suggests although some/all? of the recordings have been handed over to law enforcement agencies for further investigation, no charges will be brought because the president is so badly implicated.

Even though there may be more recordings that will be 'drip-fed' out in weeks to come, a story that in any 'normal' country would shake the government and administration to its roots will peter out. Sadly, the jaundiced electorate have long ago made up their minds about how diabolically corrupt their elected leaders are..

p.s. TVi report, with interviews in Ukrainian here

Khodorkovsky and Tymoshenko

I a few weeks time the movie: "Khodorkovsky" will be released. [Brief trailer video and details here ]

The film hints that Khodorkovsky may have 'actually gone to jail on purpose' i.e. instead of fleeing, he wanted to become a martyr and, eventually become president. As one of his Yukos colleagues said, right now: 'He has become Putin's personal hostage'.

Former PM Yulia Tymoshenko is increasingly being referred to as 'Ukraine's Khodorkovsky'.
She, and former Interior Minister Yuriy Lutsenko, whose trial is drawing to an end, both knew what awaited them.

In a recent interview, BYuT deputy Roman Zabzaliuk, who in a sting operation induced turncoat deputy Ihor Rybakov to give him bribe of nearly half a million dollars, says Rybakov, when asked about Tymoshenko, curtly told him: "She got what she wanted". This is not the first time such thoughts have been expressed by members of the ruling party. The opportunity for flight was available.

Wily parliamentary speaker, Volodymyr Lytvyn, said, when asked about Tymoshenko last Friday on 'Shuster Live: "We are at a dead end. Ukraine has become a hostage of the problem of Yulia Tymoshenko....there will be no ratification of the Association Agreement with the EU until this problem is solved...Ukraine, its people, have become hostages of this situation". Lytvyn alleged that the opposition were somehow hindering the setting up of legal mechanisms or manipulations to free her.

I would suggest it was not 'Ukraine' or its people that sent her to prison. Only one man bears responsibility - the president. She has become Yanukovych's personal hostage - the analogy with Kodorkovsky is fair.

Few predict Putin will remain president for another 12 years when he wins the next elections. Few can predict Tymoshenko will remain imprisoned for 7 years; but how things work out for these two is unpredictable..nevertheless they will both remain at the heart of politics in their respective countries.

Maybe we will be watching a movie about Tymoshenko soon?

No shopping in London for Kharkiv mayor

On Friday a story appeared that the mayor of one of Ukraine's biggest cities, Kharkiv, was refused a visa to travel to Great Britain several days previously, allegedly, 'because of his criminal past'.

Hennadiy Kernes was due to travel to London with a delegation led by deputy PM, Borys Kolesnikov on Tuesday in connection with preparations for the Euro 2012 Soccer tournament.

Later on Friday, a spokesman for the Kharkiv city council claimed Kernes does have a two-year British visa in his passport, but he could not fly to London 'because of his large workload'.

Smells rather fishy. I do not believe Kernes would turn down the opportunity to travel to 'Londongrad' in such a high-power delegation...best hotels..VIP treatment etc.. World and European Football Associations are very, very wealthy bodies...and hardly squeaky-clean..]

[Over the years I've heard many times and seen situations where dozens of people wait, sweating for hours outside a high-ranking 'chinovnik's' office for an appointment....meanwhile the 'chinovnik' has gone home early because it's a sunny afternoon..Work ethic is not the first thing that springs to mind when characterising highly placed Ukrainian officials.]

Or a visa may have been granted to Kernes...and then 'pulled' at the last minute... A visa does not guarantee entry...immigration officials can detain anyone they like at the border...

And this may be warning shot across the bows of Borys Kolesnikov. Many consider him the most ruthless 'businessmen' to have emerged during the 'wild-east' '90's days in Donbas region when the Yanukovych-Akhmetov-Kolesnikov triumvirate came to dominate there.

The black list I mentioned in my previous blog may be taking shape...

And no January sales shopping for Genyk..

"There’s a man goin’ ’round takin’ names.
An’ he decides who to free and who to blame.
Everybody won’t be treated all the same.
There’ll be a golden ladder reaching down.
When the man comes around."

"When the man comes around"...Johnny Cash.

Only matter of time before black list' is posted..

'Segodnya' ran the following story today:

"Europe and the United States have received "black list" of Ukrainian officials

The list includes Yanukovych, Azarov, Firtash, Boyko and Khoroshkovsky

Long before the adoption of the PACE resolution on the functioning of democratic institutions in Ukraine, the opposition gave the leadership of the United States and European Union a list of Ukrainian officials, to whom they should apply sanctions and deny entry into these countries.

According to sources, more than serious attention, both in the EU and over the ocean in the U.S., has been given to the resulting list. According to available information. the U.S. Secretary of State Hillary Clinton mentioned the possible legalization of such a list during her recent meeting with Viktor Yanukovych [in Davos].

This list of 'grounded' Ukrainian officials, which very soon will be the subject of discussion in the highest offices of the EU and the U.S., will be headed by President of Ukraine Viktor Yanukovych, who the opposition accuses of being "the mastermind of political repressions in Ukraine", and his oldest son, Oleksander Yanukovych.

The 'top ten' includes the founder of "RosUkrEnergo" Dmitro Firtash, the Minister of Energy and Mining, Yuriy Boyko, head of the Presidential Administration Serhiy Lyovochkin, head of the SBU Khoroshkovsky, Prime Minister Mykola Azarov and Foreign Minister Konstantin Hryshenko.

Also on the list are members of the General Prosecutor's Office and chief serious crime investigator Oleksander Nechvohlod."

LEvko says 'Segondya' is a big-selling daily owned by Rinat Akhmetov - normally quite reliable - no obvious reason they should mislead. It is anyone's guess when the application of such sanctions could occur. But they will be put into place unless Yanukovych changes his attitude to political opponents - and at the moment there is little sign of this happening.
--------------------------------------------------

Dmytro Salamatin has been appointed Minister of Defence. I blogged about this thug last year. Yanukovych had previously appointed him general director of the State arms company "UkrBoronProm". His experience of the military is limited...but he will be totally loyal to the pres.

By the beginning of this year, as head of 'UkrBoronProm' Salamatin ensured all Ukrainian arms exports were monopolised and under his personal control. All income was paid to a Belize offshore company via Cyprus-based bank accounts. Ukrainian arms trade cash flows are now completely centralised, and any foreign intermediaries have most probably been excluded. Previously a separate offshore structure was set up for every major arms export contract. This allowed several insider 'clans' to flourish, and was useful when supplying arms to both sides of one conflict... [Source]

He may become even more useful if/when anti-gov. demonstrations need to be broken up and scattered, and heads cracked..

Hint to EU and Dept. of State: Maybe there is room on 'the list' for Salamatin too...

Lutsenko accuses Yanukovych of blocking prosecution of major crime bosses

The farcical trial of former Interior Minister Yuriy Lutsenko is drawing to its end.

On Monday the accused was given the opportunity to address the court. In his statement he made several sensational accusations against the president and members of PoR.

He claims he was systematically threatened when he was in the minister's chair and recounted one case where Yanukovych's spokesperson Hannah Herman warned him in parliament: "You will be imprisoned and will get to know what prison is [like]."

He claimed than in four years as Interior Minister he did not even benefit from the use of an apartment provided by the state; and unlike nearly all of his top banana predecessors, prosecutors etc., he did not "privatise" a state dacha in swanky suburbs for himself. One of the cases against Lutsenko alleges he illicitly provided an apartment for his driver.

But the most sensation accusation he directed at president Yanukovych, who after his appointment as PM under president Yushchenko, requested Lutsenko 'back-off' from the pursuit of major crime bosses.

The following from 'Kommersant'

"Yanukovych gave me some flowers and said:" We need to talk together. In the evening the three of us - me, Yanukovych and a driver drive to Mezhyhirya, which had not then been 'privatized'. With music playing, the PM says to me: "Just don't go after Sasha." I ask him, "Which Sasha?". And he says, "Don't pretend [you don't know]... Sasha Melnyk". This guy, Melnyk a.ka. Melya is no.21 on the "For Yanukovych " bloc list in the Crimean parliament. He's the leader of the [300-member (F.N.)] organized criminal gang [Seilem], responsible for about 45 murders. I replied to the PM, "Viktor Fedorovych, there's a game - cops and robbers. Well I'm the cop". He thought I was kidding."

Alexander Melnyk was arrested on September 29, 2006, but was released on October 2 and soon left Ukraine. He returned to the country on December 13, 2006, just a few days after Lutsenko was sacked by a parliamentary motion initiated by the Party of Regions.

Lutsenko claimed the current deputy prosecutor general Renat Kuzmin was wholly responsible for Alexander Melnyk's evasion of justice. "Kuzmin signed arrest warrants for two gang members, but not for the boss. After his 72 hours of detention has expired, he was released, and [he headed] straight to Boryspil [airport]".

"Having all the evidence connecting the gang to murders, including that of a policeman, deputy presecutor general Renat Kuzmin...releases the man who Yanukovych shelters - the head of the organised crime gang."

Lutsenko also accused Kuzmin of 'rehabilitating' another of Ukraine's most notorious crime bosses, Givi Nemsadze, whose gang of 50 or more gangsters allegedly committed over 100 killings. [Nemsadze says: "It was my brother what did all them murders...nothing to do with me..."]

Incidentally, much of this is not new. An excerpt from Wikileaks:

"Lutsenko told Ambassador November 17 [2006] that he had been shocked that the General Prosecutor's Office (GPO) had refused to file charges against Melnyk, who in the 1990s had led the "Seilem" gang responsible for 52 contract murders, including: one journalist; two policemen; 30 businessmen; and 15 OC competitors.

Ukrainian authorities had lured Melnyk from Moscow back to Ukraine this fall after a journalist wrote an article suggesting Melnyk was afraid of Lutsenko. Melnyk was arrested upon arrival, but after GPO non-action and Melnyk's release October 3, he fled back to Moscow. Lutsenko alleged Melnyk was behind the March 1 firebomb attempt of Budzhurova's house. Melnyk's sister Svetlana Verba served as Crimea's Economics Minister, noted Prytula.

And Ihor Lukashev, who chaired the Crimean Rada budget committee, is known as the "wallet" of Melnyk's "Seilem" gang." [More on the Wikileaks link...]

p.s. Head of EC Delegation to Ukraine Jose Manuel Pinto Teixeira today confirmed that EU leaders are refusing to meet with President of Ukraine Viktor Yanukovych - he has become an outcast. He suggested that this may continue whilst Tymoshenko, Lutsenko, and other opposition leaders remain in jail.

About time too...what normal person would want to have anything to do with such thugs..

Yanyk plugs his own corrupt company..

Video of Yanukovych's 12 minutes of "eyewash" - part of the "Energy, Resources, Environment" panel during last week's 48th Munich Security Conference here

Also on the stage were the Presidentof Azerbaijan, Commissioner for Energy, European Union, Günther H. Oettinger, Swedish Minister of Foreign Affairs Carl Bildt, and others.

Hillary Clinton gave him a telling off, accorting to this diplo-speak Department of State briefing

Arseniy Yatesenyuk asked Yanukovych a pertinent question from the floor: " You did a lot to be somehow benign to our Russian partners. You eliminated [our] NATO membership perspective, you extended the mandate to the Russian Black Sea Fleet on Ukrainian territory. Despite this Russian is not really so co-operative, we still pay the highest price in Europe for gas, Mr president, what should you do with our Russian partners?"

[Video of Yatsenyuk's full question here - His mention of Tymoshenko gained some applause]

Instead of replying directly Yanukovych mentioned that Ukraine is successfully diversifying its energy security, and in particular described the construction of major solar power stations in the country.

Read Serhyi Leshchenko's award-winning exposure of the Ukrainian head of state's corrupt links with Austrian 'Activ Solar' who are tightly linked with these projects, [in English], here

And also from 'F.N.' here

Yanukovych was shamelessly putting in a 'plug' for his own corrupt company....No wonder he got the cold shoulder from Oettinger.

More on this story from 'ZIK' here

p.s. Ex-ua - another black mark on the current administration?

A cross to be placed on Human Rights in Ukraine?

When Yanukovych was elected president, Ukraine's Cabinet of Ministers, prosecutor general's office, tax collection service, and the judiciary were almost immediately packed with his associates from the Donetsk region in a grossly disproportionate manner.

Since then the process has continued at lower levels too and a large number of top jobs in Ukraine's oblast' administrations, police, prosecutors, tax inspectors offices etc, across the country have fell into the hands of president's trustees from Donbas. Compaints about placement of 'overseers' is legion.

The 'Expres' website earlier this week published an article with comprehensive list of examples of this process .

One observer says: Today's authorities do not take into account the professionalism of candidates, but rather whether or not they are natives of the Donetsk region they can personally trust. There is no place for 'foreigners'. The main criterion is personal loyalty..this is the road to nowhere..

Today Sonya Koshkina in 'LB.com' provides another example of how the 'power vertikal' is becoming ever-more concentrated in the hands of a small band of 'Donetskiites'.

Next week Ukraine's Human Rights Ombudsman is to be re-appointed but it seems unlikely that the incumbent, Nina Karpachova, will be permitted to continue in her position. When she visited Yulia Tymoshenko in Kyiv's Lukyanov investigative isolation unit late last year she demanded doctors be allowed to treat the former PM. Karpachova called the situation "unacceptable" and contrary to European norms and conventions..

Last May she declared there was no reason for former interior minister Yuriy Lutsenko to be detained in prison and added that she would raise this issue with Ukraine’s prosecutor-general.

Favourite to replace her is the highly disreputable Hennadiy Vasiliev. He was head of the Donetsk prosecutor's office in the lawless early '90's when dozen's of businessmen were killed in the region as local state assets, factories and property were 'redistributed'. Needless to say, almost none of the cases were ever solved or perpetrators brought to justice.

He has been a PoR parliamentary deputy for several convocations, a deputy parliamentary speaker, former Prosecutor General etc. etc. as well as being a big-shot businessman.

Despite always being employed in public service, "Focus" magazine in early 2008 reckoned he was worth about $575 million, while "Korrespondent", in the same year, claimed the figure was $ 1.67billion, i.e. 16th place on the list of Ukraine's richest men.

In 2003-2004 as Prosecutor-General Vasiliev did his utmost to 'bury' the Gongadze case, and he was also linked to several dubious large land deals in and around Kyiv. After the Orange Revolution his laid low, but was re-elected to parliament in 2007. He has very rarely bothered to turn up or show his face there since then.

When Yanukovych became president, he appointed Vasiliev deputy head of the president's administration whilst he simultaneously holding onto his seat in the Verkhovna Rada - a situation not permitted by Ukraine's constitution. Since 2007 Vasiliev has never spoke from the parliamentary podium nor asked one parliamentary question.

In 2011, his name resurfaced in the media when he was linked to raiders' attacks on "Donetskstal." Because of these, trading in shares of the company on the Stock Exchange were suspended for several months, resulting not only in serious losses to the owners, but also serious upheavals in the market as a whole. Many observers considered Vasiliev behind these attempts to squeeze "Donetskstal".

Sonya Koshkina concludes: "He has been nominated of course, so that a cross can finally placed on Human Rights in Ukraine. Vasiliev and duties of ombudsman are concepts as incompatible as Viktor Yanukovych and reforms, or Viktor Yushchenko and decency."

She is correct. It is grotesque that such a person could ever be considered for the post of Human Rights ombudsman, particularly when Ukaine's legal system and judiciary are in such a shambolic state. Vasiliev has as much interest in Human Rights as King Herod had in child welfare..