Mykhailo Chechetov, the new SPF chairman, agreed the candidacy of his first deputy with the president. This week Leonid Kuchma is expected to sign an edict assigning the post to Oleksandr Bondar. The former SPF chairman stated prior to tendering his resignation that he would not mind concentrating on SPF-Verkhovna Rada liaison work. “It’s an interesting job and it doesn’t require that much responsibility,” Mr. Bondar quipped, listing his possible duties. In reality, much will depend on the fund’s ability to keep its collective nose to the wind among the legislative factions and groups in trying to sell state property at a bargain.
Mykhailo Chechetov said the SPF would lobby to pass four bills on a top priority basis: On the State Property Fund, On the Privatization Program of 2003-04, On the Administration of State Corporate Rights, and On Joint Stock Companies. Each document will be a target for heated debate in the parliament, since they are at crossroads of interests of all domestic political-financial groups. For Mr. Bondar, holding the fort for the benefit of the state will be anything but easy.
The cadre issue could be the trump card in the talks between SPF and lawmakers concerning the four bills. Most likely, Oleksandr Bondar’s will be a new post for the fund, meaning that two other posts — those of another first deputy and deputy — will remain vacant for the next couple of weeks. When negotiating Mykhailo Chechetov’s appointment, not only the majority factions, but also Our Ukraine showed an interest in the said vacancies. The president’s decision is likely to be associated with the parliament’s prospects in the six-year privatization program. Mykhailo Chechetov plans to have the program approved by Verkhovna Rada in the first reading in late May.
The SPF is also in for quite some political adventure in debating the bill on the State Property Fund. “The deputies are concerned about just one aspect: Who will give orders to the Fund,” Mr. Chechetov asks. He believes that an answer to this question will be found in the president’s political reform. The latter envisages strengthening Verkhovna Rada’s role. Proceeding from this assumption, Mykhailo Chechetov believes that the SPF ought to be subordinated to parliament. At present, the fund is only “accountable” to Verkhovna Rada and is controlled by the cabinet. But this is merely formal subordination, after all is said and done. Apparently, debates will focus on reducing the president’s influence on the SPF, as the head of state is currently in a position to solve practically all cadre issues. Most likely, the cabinet takes a dim view of Mykhailo Chechetov’s plans, as the government is likely to lose a considerable share of its control over the fund if and when the political reform is implemented.
Before long, the SPF-cabinet relationships are likely to determine who will be in charge of managing state corporate rights. All state-owned interests, according to the presidential edict, are now in SPF hands. Originally, certain state structures, above all the Fuel and Energy Ministry, were expected to resume control over some of such interests previously taken away from them Before resigning, Oleksandr Bondar discussed it as an almost fait accompli. His successor Mykhailo Chechetov appears to take a somewhat different stance. In his words, no one in the ministry has as yet submitted proposals to the cabinet expressing their desire to manage some property or another. This inspired the SPF chairman to declare that he was loath to part with such property that had been thus collected by SPF. He said that the fund would wait awhile and then draft a presidential order setting up a department to administer state corporate rights. This superstructure is expected to be headed by the first deputy to the SPF chairman. If this particular scenario is played out, the political tensions stemming from cadre tenders could peak at the SPF.
Mykhailo Chechetov seems aware of the hazard of the SPF becoming politicized, but is determined to step up contact with lawmakers. Consultations will be held within the framework of the parliament’s special privatization oversight committee, on an almost weekly basis. Proceeding from these consultations, it has already been decided to postpone the privatization of Ukrnafta and Ukrrudprom this year. The cabinet decided to try to sell the state interest in the Kremenchuk Oil Refinery. The deal is expected to yield UAH 700-800 million. In view of the approaching presidential campaign, it is easy to predict that Ukrainian privatization political tensions will reach their peak prior to the tenders.
