Europe Presses Ukraine Leader on Tymoshenko Deal

KYIV —  He might be ready to let her out. But he can't afford to let her back.

As deadlines near on the future of Ukraine's ties with Europe, President Viktor Yanukovych is under pressure to put aside personal animosity and let his jailed opponent, Yulia Tymoshenko, go to Germany for medical treatment.

Softening Yanukovych's hardline stance on his arch-rival is seen as crucial if Ukraine is to secure the signing of landmark agreements, including a free trade deal, with the European Union at a November summit.

But, diplomats say, the 63-year-old former truck driver knows that allowing her to rejoin the political fray would endanger his run at a second term in 2015, given her formidable populist appeal and her organizational skills.

“The proposal is for Tymoshenko to go for treatment in Germany on condition that she does not take part in Ukraine's political life,” wrote Dmitry Korotkov in Segodnya newspaper.

Others were more blunt. “He wants her politically dead,” one diplomat told Reuters.

The bile between Yanukovych and the sharp-tongued Tymoshenko has poisoned Ukrainian politics for years. The former prime minister emerged as his nemesis in the 2004 “Orange Revolution” when she used her powerful skills as an orator to lead street protests against vote-rigging, dooming his first bid for power.

Her defeat by Yanukovych in a bitterly-fought run-off vote in February 2010, in which she heaped insults on him, led her to a prison cell, say her supporters.

Since late 2011 she has been serving a seven-year jail term after being convicted of abuse-of-office, most of it under guard in a hospital where she is being treated for back trouble.

Political revenge

Tymoshenko denies any wrongdoing and says her prosecution is political revenge - a view shared by the European Union which has denounced her case as “selective justice” in the former Soviet republic.

From her hospital room, Tymoshenko continues to berate Yanukovych, accusing him of plundering the country's resources to enrich himself, his family and his coterie of favorites.

At a March news conference Yanukovych declined to give a direct answer about his wealth or that of his elder son, Olexander, a wealthy businessman, but routinely dismisses such charges as politically motivated.

Tymoshenko's critics lay similar charges at her door, pointing to the personal fortune she amassed in the 1990s as a businesswoman operating in a murky gas industry - activity which earned her the nickname of 'the gas princess.'

'Humanitarian' gesture

For some months now, E.U. heavyweight Germany has been formulating a plan to provide Yanukovych with a way out - quietly pushing a “humanitarian” solution in which Tymoshenko could be received for medical treatment in a Berlin hospital.

This formula - so the logic goes - would allow Yanukovych to show himself in a good light and might ensure signing of planned agreements on political association and free trade with the European Union at the Vilnius, Lithuania, summit.

“In his intensive exchanges with counterparts in the Ukrainian government, Foreign Minister [Guido] Westerwelle has reiterated the government's offer of medical treatment for Yulia Tymoshenko in Germany,” the German Foreign Ministry said in Berlin.

Envoys from the European Parliament who also last April helped secure the release of a Tymoshenko ally, visited Ukraine again last week, pushing “the German option” as a way of breaking the deadlock over Tymoshenko.

But it is still unclear which way Yanukovych will jump as his administration continues to pile up charges against her.

Fearing a Tymoshenko comeback

Yanukovych's fears Tymoshenko could re-emerge as a political threat to him, no matter what the conditions attached to a humanitarian pardon, have led to tortuous negotiations, an E.U. insider said.

According to this source, the Yanukovych camp is insisting as part of any deal that she must pay back more than 1.5 billion hryvnias (about $188 million) in estimated damages to the Ukrainian economy caused by her alleged reckless conduct as prime minister.

“The thinking is that that would prevent her [from] financing any campaign against him,” the source said.

Brushing off E.U. charges of “selective justice”, Yanukovych's aides repeat the mantra that the rule of law has to be respected.

Potential rewards

Yet an end to the impasse promises Yanukovych rich rewards.

The free-trade agreement potentially on offer from the European Union would open up a huge market for Ukrainian exports - steel, grain, chemicals and food products - and provide a powerful spur for much-needed foreign investment.

That would be a boon for a country traditionally reliant on trade with Russia and guarantee Yanukovych a place in the history books, something aides say he still aspires to.

An E.U. deal is also in the interests of influential power brokers in Ukraine such as steel billionaire Rinat Akhmetov and others, and Yanukovych has consistently set European integration as a foreign policy priority.

Nevertheless, only a change of power in 2015 and the end of the Yanukovych leadership is likely to secure early release for the ambitious Tymoshenko.

She is under family pressure to protect her health but knows departure might end her political career in politics.

Second term within reach

For despite low ratings due to popular anger over low wages, high prices, poor social services and endemic corruption, Yanukovych looks well placed for re-election in 2015 - as long as Tymoshenko remains out of the running.

Opposition figures such as world heavyweight boxing champion Vitaly Klitschko and former economy minister Arseny Yatseniuk have failed to agree on a single candidate to challenge him.

Though opinion polls now show Yanukovych well behind in any straight fight with Klitschko, most commentators believe he will be able to marshal the resources of wealthy entrepreneurs and a tamed press to ensure a second term.

So as time for a deal runs out - the mediation mandate of two European parliament envoys expires at the end of September - Yanukovych has yet to signal he is ready to compromise.

“The cost of letting her go is too much to President Yanukovych personally,” said Olha Shumylo-Tapiola, visiting scholar of Carnegie Europe in Brussels.

“If Tymoshenko gets out somehow, this would be a real threat for Yanukovych. Even if she could not run in the election, she has very strong organizational powers. She is still considered a very dangerous person for the authorities,” she said.