Ukraine’s PM Groysman Resigns. What’s Next?

25 May 2019 11:57

Prime Minister Volodymyr Groysman resigned on May 22 following the meeting of the Cabinet of Ministers. Ukrainian Parliament registered his letter on May 23. Now it is up to the Parliament to consider the resignation. In any case, the current government continues to perform its duties until the next one is elected. Thus Groysman is responding to the call by Ukraine’s new President Volodymyr Zelenskyy "to make space for those who will think about next generations". Hromadske takes a look at what Groysman’s decision means for the government and who will form the new Cabinet of Ministers.

What is known about the resignation of Groysman?

The current Prime Minister announced he is leaving on Wednesday, May 22. Two scenarios may unfold.

In the first one, the parliament accepts the resignation of Groysman, along with his entire Cabinet, in accordance with the Constitution. But after that, only the Prime Minister leaves the government premises. Ministers continue to work, but by obtaining the status of acting. The seat of the head of government should be taken by First Deputy Prime Minister Stepan Kubiv. Cabinet of Ministers works in such status until a new government is elected.

If the elected representatives decide that the responsibility for the situation in the country should be borne by two Volodymyrs, not one, and fail to support the resignation, Groysman remains in charge of the Cabinet until the Parliament forms the new government.

No man is an island

A month ago, when talking to the TV channel ICTV, Volodymyr Groysman confirmed his plans to take part in the next parliamentary elections originally scheduled for late October 2019, but which Zelenskyy has since brought forward to July 21. But Groysman is unlikely to give up his plans just because of the dissolution of the Parliament by Zelenskyy.

Will the rest of the ministers follow Groysman? In the current government, two deputy prime ministers are following the Prime Minister - Volodymyr Kistion and Hennadiy Zubko, as well as the Minister of Social Policy Andriy Reva. If they decide to take part in early parliamentary elections together with Groysman, they will either have to write an application to leave the Cabinet for the election campaign, or follow the path of their boss in resigning.

Will Groysman resign? What do deputies say?

“There was no discussion yet. This responsibility lies with the newly elected President. He is not seeking cooperation with the International Monetary Fund, Parliament, and the government. Apparently, he has his own recipe for how to govern the country,” says Maria Ionova, MP from Petro Poroshenko’s Bloc.

A deputy from the “People’s Front” faction Ihor Lapin stated that on May 21 a meeting of the party’s faction took place where the faction decided whether or not they support Groysman.

Andriy Sadovyi, the mayor of Lviv and the head of the Samopomich party, believes that not only Groysman, but the entire government will resign. “If the president decided to dissolve the parliament, then the same fate awaits the government. It goes without saying,” Sadovyi noted.

What state of economy is Groysman leaving behind?

In general, the situation can be called stable. This is partly due to the introduction of currency liberalization in February, which stabilized the national currency rate against the dollar. It is now much less dependent on seasonal factors. In addition, the National Bank of Ukraine no longer significantly interferes in maintaining the exchange rate, which enabled accumulation of $20.8 billion worth of gold reserves in recent years, which is almost three times more than in 2014.

Ukraine’s GDP has been growing for three years in a row, albeit at a modest pace. For example, according to the State Committee of Statistics, last year it grew by 3.3%, which means that the country's economy is in the state of growth. Also, the rate of inflation is declining. Consumer price growth in 2018 slowed to 9.8% from 13.7% in 2017. This has been achieved due to the inflation targeting policy.

The economic achievements of the Groysman’s government also include the record low budget deficit. In 2018, the Ministry of Finance managed to achieve the minimum difference between the cost and revenue parts of the main budget of the country. In 2019, the state will spend more than a trillion hryvnias ($37.9 billion) to cover its own needs. At the same time, thanks to decentralization, local budgets in Ukraine increased from UAH 70 billion ($2.66 billion) to almost UAH 270 billion ($10.2 billion), almost fourfold.

Conflicts

Groysman had distinguished himself during the conflict with the head of Naftogaz of Ukraine, the state oil and gas company, Andriy Kobolyev. Kobolyev, who won the Stockholm arbitrary court case against Russia's state oil and gas company Gazprom, was planned to be dismissed by the Cabinet of Ministers because of alleged defiance of the law. However, only the Supervisory Board of Naftogaz has the right to dismiss him from his post.