Orange Vu: Tymoshenko, Poroshenko Return As Orange Parties Form New Coalition.

In the Rada this morning the “Orange” parties announced they had signed a coalition agreement that will allow them to form the new government. The Tymoshenko Bloc got most of the important posts in the new cabinet including: The prime minister, (Yulia Tymoshenko), the Energy, Agriculture, Finance, Economy, Coal, Construction, Emergencies and Health ministries, plus the State Property Fund. Our Ukraine got the Speaker position, the Interior, Justice, Industry, Labor, and Youth & Sport ministries, a deputy prime minister position in charge of local government reforms, and the Antimonopoly Committee. The Socialists received the first deputy prime minister and ministries of Transport & Communications, Ecology and Education. Tymoshenko said she “hadn’t slept” since hearing the news last night that Our Ukraine voted to nominate Petro Poroshenko as speaker and then said she would not say more in order not to ruin the coalition. Socialists leader Olexander Moroz said about Poroshenko “we’ll see”. Concorde Capital: This configuration puts Tymoshenko practically fully in charge of the economy, while most of Our Ukraine’s and the Socialists’ strength will be in parliament. By contrast, President Yushchenko (who nominates the Defense and Foreign Affairs ministers, the general prosecutor and the SBU national security police) and Our Ukraine have moved into a defensive position by taking the Interior Ministry, Antimonopoly Committee and Rada Speaker, which would allow Our Ukraine to steer parliament if the coalition breaks down. Poroshenko’s nomination as Speaker, which went against Yushchenko’s preference for Yuri Yekhanurov, may be the only way to bring him and his allies into the coalition and secure a majority, but we don’t rule out that Yushchenko could weigh in to support Yekhanurov. Tymoshenko’s formidable list of ministries gives her motive to accept Poroshenko. Even so, Poroshenko as Speaker would increase the risk that the coalition could be short-lived. Look for Tymoshenko to seek control of Naftogaz Ukrainy and to take the US up on its offer to help renegotiate the gas agreement with Russia. There are also decent chances for quick action on bills needed for the World Trade Organisation.