Ukraine fails to agree new pro-EU cabinet after PM quits

Ukraine's parliament on Tuesday postponed a vote to approve embattled Prime Minister Arseniy Yatsenyuk's resignation as furious backroom battles raged over the makeup of a new pro-EU government.

The latest twist in the ex-Soviet state's volatile political drama came when the man tipped to succeed Yatsenyuk -- condemned by President Petro Poroshenko for losing the public's trust -- appeared unwilling to assume his duties because of a conflict over who should join his team.

Oleksiy Goncharenko, a member of Poroshenko's party, told reporters after a gruelling day of negotiations that "we hope that (the vote) can be taken on Wednesday or Thursday".

Yatsenyuk's days had seemed numbered since he survived a no-confidence vote two months ago that fractured the pro-Western coalition formed after a February 2014 revolution forced the ouster of Moscow-backed president Viktor Yanukovych.

The 41-year-old former banker joined the street protests in Kiev and made passionate pro-EU speeches during three turbulent months that changed the country's course.

But his party's approval ratings have slipped to around two percent due to a sense that he done little to overcome corruption or break the stranglehold on politics enjoyed by a handful of tycoons during Yanukovych's four years in office.

Yatsenyuk has been further hurt by an economic implosion that wiped out people's savings and saw precious state resources spent on fighting a two-year pro-Russian uprising that erupted two months after he assumed office in February 2014.

He announced his resignation on Sunday.

- New government battle -

Poroshenko's party has nominated parliament speaker Volodymyr Groysman to the premiership after deciding that the man known as a coalition-builder could win broad support.

The 38-year-old Poroshenko protege had seemed ready to take on the assignment on Monday afternoon.

"I am good for it. I am able to work 24 hours a day," Groysman told reporters.

But lawmakers said he had decided to turn down the job when the president's party met on Monday evening to determine who should join his team.

They said Groysman refused to work with several of the figures named because they did not represent his reformist agenda or commitment to austerity measures prescribed by the IMF under its $17.5-billion (15.4-billion-euro) economic rescue loan.

Release of new International Monetary Fund funds is not expected until Ukraine forms a stable new government that follows through on the belt-tightening pledges made when Yatsenyuk helped craft the deal in March 2014.

Poroshenko convened his party on Tuesday morning in a bid to smooth over the differences and persuade Groysman to push ahead with his premiership candidacy.

But the Ukrainska Pravda news site reported that Groysman was again threatening to turn down the job.

"Tempers are rising and the talks have hit a dead end," presidential party member Sergiy Leshchenko wrote on Facebook.

Some analysts have expressed concern that Groysman's premiership -- should it ever come through -- would concentrate political power with the president and his inner circle.

"Poroshenko is about to take full control of the government," Anders Aslund of the US-based Atlantic Council international affairs institute wrote in a report.

- Worries about finance chief -

Economists are also worried about the expected departure of Urkaine's respected Finance Minister Natalie Jaresko.

The US-born former State Department worker and private banker has been widely praised for being able to pull together a crucial debt restructuring deal in August 2015.

But Poroshenko party member Mustafa Nayyem tweeted that Jaresko's place would be taken by Oleksandr Danylyuk -- the president's current representative in the cabinet.

Nomura International strategist Timothy Ash said Danylyuk once served as an advisor to Yanukovych but that most people now viewed him as "progressive/technocratic".

"Western creditors I think will be willing to give Poroshenko, Groysman and Danylyuk the benefit of the doubt at this stage," Ash wrote in the Kyiv Post.
Source: AFP