Ukraine’s Prime Minister Arseniy Yatsenyuk Resigns

After facing months of criticism for the slow pace of reforms and the abysmal state of the economy, Ukrainian Prime Minister Arseniy Yatsenyuk announced his resignation on Sunday in a televised address.

The decision comes after he narrowly survived a no-confidence vote in his government and sets the stage for President Petro Poroshenko to consolidate power and install his close ally, Volodymr Groysman, a member of his own party, as the next prime minister.

“Having done everything to ensure stability and make a smooth transition of power possible, I decided to step down from the post of prime minister of Ukraine,” said Yatsenyuk.

Yatsenyuk, a pro-Western leader and longtime ally of senior State Department diplomat Victoria Nuland, came to power on a platform of cleaning up government and implementing economic reforms. In a notoriously leaked phone call at the height of Ukraine’s political crisis in February 2014, Nuland told the U.S. ambassador to Ukraine that she preferred Yatsenyuk for a senior position in the country’s fledgling government. “Yats is the guy who’s got the economic experience, the governing experience,” she said.

But the 41-year-old politician has come under fire for allegedly sidelining the government’s reform efforts, which prompted Poroshenko to ask for his resignation earlier this year. That led to a no-confidence vote in the Ukrainian parliament in February, which Yatsenyuk narrowly survived.

In his remarks on Sunday, Yatsenyuk said he would formally submit his resignation to parliament on Tuesday.

“My decision is based on a several reasons,” he said. “The political crisis in the government has been unleashed artificially, the desire to change one person has blinded politicians and paralyzed their will to bring about real changes in the country.”

Now Poroshenko will be under intense scrutiny from European and American officials, his own people, and the country’s financial creditors to carry out real reforms — a task that could be difficult as a roster of respected reformers have exited the government in recent weeks citing its failure to root out corruption.

Since the February no-confidence vote, Poroshenko’s allies have been working to find a way to reshuffle the cabinet and preserve a ruling coalition in order to avoid calling early parliamentary elections. Poroshenko’s party nominated Groysman, the parliamentary speaker, to replace Yatsenyuk in late March, but forming a new coalition has been extremely difficult for the president’s allies.

Efforts to form a new government were further derailed following allegations put forward in the so-called “Panama Papers”  — a trove of 11.5 million documents leaked from the Panamanian law firm Mossack Fonseca — which alleged that Poroshenko illegally started a business and used offshore accounts to avoid paying taxes in Ukraine. The president has denied the tax evasion charges and said that his actions are completely legal. However, the political fallout from the document leak derailed efforts to form a new government, complicating the already difficult political math to form a new coalition.

Prior to the document leak, former Prime Minister Yulia Tymoshenko’s “Fatherland” party announced it would officially join the opposition after having left the coalition earlier. A parliamentary majority is required to approve Groysman’s appointment and Poroshenko and Yatsenyuk’s parties — the two largest in the legislature — will need to reach out to a smaller bloc or win over individual lawmakers across the aisle to put their numbers over the edge to maintain a 226 seat majority. Combined, Poroshenko and Yatsenyuk’s parties currently hold 217 seats.

With Yatsenyuk’s announcing that he would formally submit his resignation to Parliament on Tuesday, the stage is set for more political brokering. Yatsenyuk’s People’s Front party is expected to maintain powerful positions in the new cabinet and despite no longer sitting as prime minister, will continue to wield influence in Ukrainian politics.

Later on Sunday, Vice President Joe Biden called Yatsenyuk and emphasized the need for a new cabinet to implement “needed reforms, in particular those recommended by the International Monetary Fund and European Union.”

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