KIEV (Reuters) - Ukraine’s prospects of forming a new coalition - vital to get IMF loan talks back on track - were thrown into fresh doubt on Tuesday after Yulia Tymoshenko pressed demands as the price of taking her Fatherland Party into an alliance.
Her remarks dampened expectations of an imminent deal to end months of political infighting that have delayed Western-backed reform efforts and left Ukrainians increasingly disillusioned with the pace of change after the Maidan protests that brought the pro-Western leaders to power.
The scale of the challenge for any new administration was laid bare on Tuesday by the sacking of a reformist senior prosecutor, who at a news conference accused vested interests of throttling his efforts to tackle corruption in the prosecution service.
Tymoshenko’s requests include scrapping a tax on pension payments and rolling back energy price hikes. The latter is a key reform implemented under Ukraine’s bailout program from the International Monetary Fund.
The lack of a stable coalition capable of pushing reforms through parliament has derailed talks for a new $1.7 billion loan from the IMF. The Fund has warned that political paralysis is putting the entire $17.5 billion aid program at risk.
Tymoshenko’s comments suggested a coalition was far from agreed despite an announcement by Prime Minister Arseny Yatseniuk’s party of a new alliance with Fatherland and the faction belonging to President Petro Poroshenko.
Tymoshenko “is demanding a stack of political laws be voted on before joining the coalition. Everyone has to go back to the drawing-board,” a source in Poroshenko’s faction said.
Fatherland is the smallest party in parliament, but the support of its 19 lawmakers is enough to give the coalition a majority when added to the 216 MPs from Poroshenko’s and Yatseniuk’s factions.
Parliamentary Speaker Volodymyr Groysman, a 38-year-old former mayor and ally of Poroshenko, has been put forward as a replacement prime minister, but Yatseniuk has refused to step down until a new coalition agreement is signed.
Anton Gerashchenko, a lawmaker in Yatseniuk’s faction, said the three-party coalition had not been formalized.
The head of Yatseniuk’s party, Maksym Burbak, said they did not expect any final coalition agreement before next week.
Failure to form a coalition could trigger snap parliamentary elections, which critics say would delay reforms further and boost support for populist parties who oppose the IMF-backed austerity measures.
Meanwhile the prosecutor’s office was similarly immersed in high-level squabbling.
Parliament approved the forced resignation of General Prosecutor Viktor Shokin - an ally of Poroshenko - but before the vote his office announced that he had dismissed top reformist prosecutor, Davit Sakvarelidze, for “grossly violating” the ethics of his post.
Sakvarelidze, who has been in a long-running feud with Shokin, said the dismissal of him and his colleagues amounted to “a cleansing of people who are prepared every day to fight corruption and the old guard without compromise.”
Writing by Alessandra Prentice; editing by Matthias Williams and Richard Balmforth