McLARTY FIRST TAKE: Ukrainian president’s party wins majority in snap Rada elections

July 22, 2019

Ukraine’s snap parliamentary election on July 21 saw a commanding victory from comedian-turned-President Volodymyr Zelenskyy’s newly-formed Servant of the People (Sluha Naroda – SN) party. This result will mark the first time in Ukraine’s history that a single party controls the majority of seats in the Verkhovna Rada (parliament), giving the new president a strong mandate to form a government and pursue his policy agenda without the typical coalition-building compromises faced by previous administrations. Though Zelenskyy’s resounding victory in April’s presidential election (73% of the vote over incumbent Petro Poroshenko) received much attention, in practice, the Rada elections are more important given Ukraine’s political structure. Yet in this instance, the president should have considerable latitude to influence policy beyond his official foreign policy and national security mandate should he desire to do so.

Ukraine’s electoral system is split between a party list (225 seats) and single-mandate system (199 seats), meaning that voters select a party as well as an individual candidate to represent their districts for a five-year term. SN won at least 250 of 424 available seats (59%) to date. Exit polls for the party-list voting gave SN 44%, with pro-Russian Opposition Platform-For Life in second place with 11%, followed by Yuliya Tymoshenko’s Fatherland (Batkyvshchyna) with 8%, former present Petro Poroshenko’s European Solidarity (7%), and rock star Slava Vakarchuk’s Voice (Holos) just above the 5% threshold to enter the Rada at 6%. While only five parties passed the 5% barrier, others could still enter the Rada through the single-mandate system, albeit in very small numbers. The 50% turnout was lower than the presidential election, likely due to the summer timing and greater voter interest in the presidential contest.

In addition to being the first single-party majority Rada in Ukraine’s history, the new parliament will also have the smallest contingent of pro-Russian parties. Servant of the People won in all regions, including eastern Ukraine, further showing a decrease in the East-West divide that has influenced Ukrainian politics historically. Moreover, the elections resulted in a 60% turnover of Rada deputies, meaning that many new faces will replace old, often entrenched and, in some instances, corrupt parliamentary stalwarts. At the same time, high-profile “Euro-optimists” who entered the Rada in 2014 aligned with Poroshenko likewise will not join the new Rada, which will be dominated by political p

While Zelenskyy’s party has sufficient seats to set up a government, the president still initiated “pro-Western” coalition talks with Vakarchuk to potentially create an even stronger governing mandate in the coming weeks. As part of this process, Zelenskyy noted on election day that he would choose a “professional economist” who has not held a top political post for prime minister (depending on how he defines the latter criterion), which likely narrows the list of potential candidates down to former finance minister Oleksandr Danylyuk, former economy minister Aivaras Abramovicius, Ukrainian state gas company Naftohaz chief Andriy Kobolyev, Naftohaz executive Yuriy Vitrenko, and IMF Ukraine representative Vlad Rashkovan. In short, this means that veterans Yuliya Tymoshenko and Petro Poroshenko will not be considered for the top job. Moreover, it suggests that Zelenskyy is serious about economic reforms and maintaining the country’s IMF commitments. Still, the extent to which Zelenskyy successfully opens up the economy to competition through effective anti-trust laws will be an important gauge of his willingness to fight corruption.

On the legislative front, the new Rada will have its first seating by September 10, and it will be required to revisit any draft laws not passed in the previous Rada (which likelhy held its final session on July 19). Former PM Groysman’s government left a considerable backlog of legislation in its final years – a product of fracturing coalitions and plummeting support for President Poroshenko. In short, the new Rada will not be starting from a blank slate. Zelenskyy will be keen to introduce new legislation early on eliminating parliamentary immunity, criminalizing illicit enrichment, and empowering anti-corruption bodies to do their jobs. He will also seek to renegotiate a peace agreement in Ukraine’s east and generally improve Ukraine’s economy – all ambitious goals.

On the horizon, in addition to monitoring cabinet appointments, the following developments are worth watching. We can expect Zelenskyy and his team to make a strong, inaugural showing at the UN General Assembly in late September. Zelenskyy called Russian President Vladimir Putin last week (their first conversation), where they discussed possible release of prisoners and working through the Normandy Format to resolve the war in Ukraine’s east. Another Russia development to watch will be the ongoing negotiation between Naftohaz and Russia’s Gazprom over the conditions of its Ukraine transit contract, which is due to expire at the end of 2019. Finally, US engagement with Zelenskyy’s Ukraine will likely continue in its current form; however, Zelenskyy has thus far prioritized cultivating relationships in Paris, Berlin, and Brussels – as well as with Ukrainian diaspora outpost Canada – over the United States. We can expect more robust US engagement once a PM is in place, including a possible White House visit.