INTERVIEW: “The weekend’s protests were the Russian people's, not the opposition’s” – Maxim Reznik
Western Balkans citizens legally resident in EU equal to 14% of region’s population
International Ice Hockey Federation (IIHF) has stripped Belarus of the right to hold the World Championship this year
Alexei Navalny arrested on arrival as he returns home
@russian_market sacked by UBS for supporting Navalny
Elbrus Capital attracts major international players to invest in the Russian digital sphere
Russian President Vladimir Putin and US President Joe Biden have first phone call, extend START II treaty for five years
ING: Russian budget’s modest deficit leaves fiscal room for 2021
Public support is collapsing for The People’s Servant Party
Ukraine’s industrial output jumped 4.8% y/y in December
State-owned Ukrgasbank signs off on convertible €30mn IFC loan ahead of its privatisation
National Bank of Ukraine retains a key policy rate at 6%, the outlook of the CPI deteriorates
Estonia's two big parties agree on grand coalition
VISEGRAD BLOG: Central Europe's populists need a new strategy for Biden
LONG READ: The oligarch problem
OUTLOOK 2021 Lithuania
Czech billionaire Kellner´s PPF makes another bid for Moneta Money Bank
Czech MPs pass protectionist food law in violation of EU rules
M&A in Central and Eastern Europe fell 16% in value in 2020, says CMS report
Hungarian vehicle makers hit by supply chain shortage
COVID-19 and Trump’s indifference helped human rights abusers in 2020
Polish parcel locker operator InPost soars in Euronext Amsterdam debut
Polish industrial production continues boom in December
OUTLOOK 2021 Poland
OUTLOOK 2021 Slovakia
BRICKS & MORTAR: Rosier future beckons for CEE retailers after year of change and disruption
FDI inflows to CEE down 58% in 1H20 but rebound expected
BALKAN BLOG: Only better waste management can clean rivers of trash
Pandemic pushes public debt close to 80% of GDP in Albania and Montenegro
BALKAN BLOG: Superstition and resentment surround vaccination plans
Albania needs reforms for e-commerce to thrive, says World Bank
Bosnia's exports in 2020 amounted to BAM10.5bn, trade deficit to BAM6.3bn
Bulgaria’s latest nuclear u-turn
Retailers and restaurant owners threaten protests in Bulgaria if reopening is delayed
Bulgaria's Biodit first company to IPO on new BEAM market
Spring lockdown caused spike in online transactions in Croatia
ING: Growth in the Balkans: from zero to hero again?
Labour demand down 28% y/y in Croatia in 2020
Kosovo’s biggest opposition party risks being unable to run in general election
OUTLOOK 2021 Moldova
Storming parliaments: New Europe's greatest hits
World Bank revises projection for Moldova’s 2020 GDP decline to 7.2%
Montenegro’s special prosecution probes finance minister over €750mn Eurobond issue
North Macedonia’s state-owned loss-makers await new owners
North Macedonia plans to cut personal income tax in IT sector to zero in 2023
Romanian cybersecurity company Safetech floats shares amid rising investor interest
Romania government to pursue “ambitious” timetable for justice reforms
Private finance mobilised by development banks up 9% to $175bn in 2019
EBRD and WBIF support fast broadband in rural Serbia
Slovenia plans region's longest-tenor Eurobond
Slovenian crypto payment system enters Thai market
Slovenia’s economic sentiment indicator up 2.2 pp m/m in January
Slovenia lost €10bn by neglecting wood industry for decades
D’S Damat franchise deals ‘show Turkey’s hard-pressed mall operators becoming their own tenants’
Turkey’s benchmark rate held as concerns over faltering recovery come to fore
Turkish lira breaches HSBC’s stop-loss, Turkey ETF signalling outflows
Following war with Armenia, Azerbaijan gains control of lucrative gold mines
CAUCASUS BLOG : What can Biden offer the Caucasus and Stans, all but forgotten about by Trump?
Armenia ‘to extend life of its 1970s Metsamor nuclear power plant after 2026’
OUTLOOK 2021 Azerbaijan
OUTLOOK 2021 Georgia
“Try me” not telecoms minister Iran’s president tells hardliners in internet row
Iran’s President Khamenei menaces private citizen Trump
Iran’s technology minister indicted for failing to properly implement internet censorship
No US move to rejoin Iran nuclear deal imminent, say Biden national security nominees
Central Asia vaccination plans underwhelm, but governments look unruffled
Fears of authoritarianism as Kyrgyz populist wins landslide and backing for ‘Khanstitution’
COMMENT: Mongolia is an island of democracy
OUTLOOK 2021 Mongolia
Mongolia's PM quits amid protests over treatment of mother with coronavirus and newborn baby
Mongolia's winter dzud set to be one of most extreme on record says Red Cross
Tajikistan: Writing for the president is on the wall (and then scrubbed off)
OUTLOOK 2021 Turkmenistan
Turkmenistan: How the Grinch stole New Year
COMMENT: Uzbekistan is being transformed, but where are the democratic reforms?
Download the pdf version
Ukrainian president Volodymyr Zelenskiy shook up Ukraine’s parliament and sacked several top officials as well as ousting the embattled Ukrainian Prime Minister Oleksiy Honcharuk.
Ukraine's parliament, the Verkhovna Rada, has accepted the resignation of the nation's Prime Minister Oleksiy Honcharuk after the premier submitted his resignation letter on March 3.
The motion to accept the resignation was supported by 353 lawmakers on March 4 at a special session of parliament called by Ukrainian president Volodymyr Zelenskiy.
Honcharuk’s deputy, Denys Shmyhal, was promoted to take over as acting prime minster and lead the cabinet.
Honcharuk, 35, was installed as Ukraine’s youngest- ever prime minister to oversee an ambitious economic reboot, but economic growth and investment have underwhelmed and recent opinion polls show Zelenskiy’s popularity and that of the government beginning to slide. Some commentators say that Zelenskiy’s bet on “rookie” politicians that were supposed to be the new clear broom to sweep the old corrupt system away has not paid off. Now Zelenskiy is talking about hiring not just clean officers but also ones with experience, indicating some familiar faces from the previous regimes of former President Petro Poroshenko, Viktor Yanukovych and Viktor Yushchenko are likely to reappear.
Oleksandr Kornienko, the president’s party chief, said before the changes were announced that the shuffle won’t mark the end of the “new faces philosophy.” Incoming officials, though, will need experience managing state-run or private businesses.
“Trust in the president remains, and there’s trust in his economic and social program,” he said. “We have very nice goals for the government but in some spheres it’s been chaotic.” The move followed weeks of controversial reports about possible the dismissal of Honcharuk thanks to his deteriorating relations with Zalenskiy, who is also under pressure following poor popularity poll results.
At the same time Honcharuk has clashed with oligarch Ihor Kolomoisky who is believed to have played a role in ousting Honcharuk. The PM backed a bill that would have made it illegal to return a bank to its former owner if that bank has been nationalised. Kolomoisky has been lobbying to get back his Privatbank that the government nationalised in 2016.
Honcharuk also approved a government decision to sack the management at top utilities company Centrenergo, but the new team were physically barred from entering the company offices at the weekend. Kolomoisky was reportedly in control of the previous management team and the government intends to privatise the attractive power generator.
Other top officials were also replaced in a reshuffle that has been expected since February when Ukrainian media reported that Zelenskiy intended dismissing the country's pro-Western Foreign Minister, Vadym Prystaiko, amongst other names.
In January, Zelenskiy refused to accept Prime Minister Oleksiy Honcharuk's resignation, and decided to give him "a chance if you resolve some things that are very important today and are of concern to our society", Zelenskiy said. In particular, the government must present to Zelenskiy "a new concept of salaries of heads of ministries, departments, state-owned enterprises and their deputies, taking into account the situation in the country".
On January 17, Honcharuk said he had filed the letter of resignation to the president in order to prevent any speculation about disrespect of government members for the chief of state. The PM added, however, that he and his cabinet were going to work "as usual" until Zelenskiy had taken "a political decision". Under the Ukrainian constitution the Rada, not the president, has the authority to sack the prime minister. Honcharuk’s decision to send his letter to Zelenskiy and not the Rada deputies smacks of political theatre.
The first letter followed a scandal after a leaked tape showed Honcharuk making disparaging remarks about Zelenskiy competence and lack of economic knowledge. The recordings were of a classified government meeting at the central bank that were posted on the Telegram social media platform on January 15. Honcharuk’s comments were made during several meetings with Ukraine’s top economic officials, including the National Bank of Ukraine's (NBU's) first deputy governor Kateryna Rozhkova, NBU deputy governor Dmytro Sologub and Finance Minister Oksana Markarova.
On the March 3 meeting, Zelenskiy proposed selecting Denys Shmyhal as the new PM, not just acting, as had been previously reported by local media. Several lawmakers leaked the discussed nominees to the Ukrainska Pravda online outlet this week.
Another victim of the reshuffle was Ukrainian Finance Minister Oksana Markarova, who is seen by Ukraine’s donors as a competent pair of hands, although the government has been struggling to meet the budget plan as revenue collection has been behind target this year and last year.
“I feel sorry for Oksana Markarova. She did a stellar job in running public finances - managing a record low in Ukraine’s overseas borrowing costs as foreign investors trusted her,” said Tim Ash, Senior Sovereign Strategist at BlueBay Asset Management. “She also helped manage the difficult portfolio of state owned banks, including state interests in the Privatbank case. Maybe that did for her in the end, which must now be a concern in terms of future relations with the IMF, markets and investors.” Earlier reports say that the IMF team that was in Kyiv last week has still not reached an agreement with the IMF on the new Extended Fund Facility (EFF) for $5.5bn and provisions in the new banking law that forbids returning banks to their former owners is the problem. The law allows for the payment of some compensation to the former owners, according to reports, something the IMF team won’t accept. Kolomoisky has been asking for either the return of Privatbank or the payment of at least $2bn.
Markarova is likely to be replaced by Ihor Umansky, who has served as the deputy minister of finance in the past.
“He likely knows where some of the skeletons are hidden but a concern is that he never showed himself as a proven reformer - more managing the status quo. Maybe that is what Zelenskiy now needs,” says Ash.
The change of finance minister will unsettled the holders of Ukraine local debt as international investors have sunk some $5bn into the local debt market in the last year. However, as a former finance ministry official Umansky will not worry them too much, say experts. Umasnsky served in governments in 2009 and 2014-2015 under Prime Minister Yulia Tymoshenko and Poroshenko.
“If bond holders hit the exits it could get ugly very quickly with a large number of investors trying to get through a very small door in an over positioned trade. And under the new management it is unclear whether the NBU (which might also see HR changes) would be encouraged to provide liquidity to ease the process. Rather oligarchic interests likely will have more interest in securing a more competitive UAH albeit that would be at the price of higher borrowing costs. Not sure Zelenskiy gets all this,” said Ash.
here to continue reading this article
and 5 more for free or purchase
12 months full website access including
the bne Magazine for just $250/year.
Register to read the bne monthly magazine for
Password could contain only
and have 8-20 symbols length.
Please complete your registration by confirming your
A confirmation email has been sent to the email
address you provided.
can't be empty.
No user with
this email address.
Access recovery request has expired, or you are using
the wrong recovery token. Please, try again.
Access recover request has expired.
Please, try again.
To continue viewing our content you need to complete
the registration process.
Please look for an email that was sent to
with the subject line
"Confirmation bne IntelliNews access". This email will have
instructions on how to complete registration
process. Please check in your "Junk" folder in
case this communication was misdirected in your
If you have any questions please contact us at email@example.com
Sorry, but you have used all your free articles fro
this month for bne IntelliNews. Subscribe
to continue reading for only $119 per year.
Your subscription includes:
For the meantime we are also offering a free
digital weekly newspaper to subscribers to
the online package.
Click here for more subscription options,
including to the print version of our
flagship monthly magazine:
Take a trial to our premium daily news
service aimed at professional investors that
covers the 30 countries of emerging
For any other enquiries about our
products or corporate discounts please
contact us at
If you no longer wish to receive
Magazine annual print
Website & Archive
Combined package: web
access & magazine print
Take a trial to our premium daily news service
aimed at professional investors that
covers the 30 countries of emerging Europe: