Zelenskyy's third cabinet of ministers: Why Shmyhal heads to defense and what to expect from Svyrydenko

Key questions:

• Why was the government in such a rush to reshuffle the Cabinet?

• Why was Shmyhal appointed to the Defense Ministry?

• Who will Svyrydenko rely on in the new government?

• How did the Vice Prime Minister's post for EU and NATO integration become the point of major personnel battles?

"Our first government, if you remember, was practically astronauts. Then came the 'rescue government', constantly saving the country from something, be it COVID or a full-scale war. Now we’ll have a third Cabinet, a kind of mix: there are experienced people, but with creative energy and fresh ideas," one prominent MP from the Servant of the People party told RBC-Ukraine.

We spoke on the eve of Denys Shmyhal’s expected dismissal from the post of Prime Minister, set for today, July 16. Though it has often seemed like this moment could come much earlier, each time, Shmyhal managed to hold on, serving as PM for a record-breaking term of over five years. A scenario few would have predicted back in March 2020 when he was first appointed.

"Shmyhal knew how to keep the Cabinet balanced. Everyone got used to things running smoothly, but that was a kind of work nobody noticed or appreciated. He gained a reputation as the second fiddle, a non-subjective and dependent on the Presidential Office, but that was his choice, to stay in the background," a government source explained.

Two wings of the Cabinet of Ministers

As RBC-Ukraine previously reported, this time the talk of a government reshuffle was grounded in reality. It was decided that the reshuffle would take place after the Recovery Conference in Rome.

Still, until the end of last week, there were rumors among MPs that Shmyhal’s dismissal might be postponed until August. In the end, however, Parliament is moving forward with the matter in mid-July.

One of the driving factors was the need to appoint a new ambassador to the United States before the Ukrainian Ambassadors' Conference, which will be held in Kyiv on July 21.

Defense Minister Rustem Umerov will be heading to Washington to represent Ukraine’s interests. This appointment is not entirely unexpected. Over recent months, different sources told RBC-Ukraine about Umerov’s strong communication skills and his ability to engage with the West, including the Americans. From that perspective, his move to Washington makes perfect sense.

Especially considering that, according to the outlet’s sources, Rustem Umerov wasn’t very effective with the main task - the organization of all processes in the Ministry of Defense.

Rustem Umerov (photo: Vitalii Nosach / RBC-Ukraine)

"That place needs someone who can bring order," a source from the Servant of the People party told the outlet.

That "someone" turned out to be Denys Shmyhal, who had earned a reputation within the government as a competent organizer.

Still, from the outside, such a transition — from Prime Minister to Defense Minister — looks like a demotion. This is hard to understand, especially with no official explanation provided. Many European diplomats are also surprised by the move.

However, RBC-Ukraine also heard a different interpretation of the situation. The idea is that Ukraine’s focus is on the defense sector now. There are huge budgets and chaos that must be overcome. Shmyhal himself reportedly did not view the move as a demotion, considering himself a team player and ready to perform the tasks he is assigned, even seeing it as a kind of mission.

Moreover, the Defense Ministry’s responsibilities will be expanded by merging it with the Ministry for Strategic Industries. However, granting Shmyhal the status of Vice Prime Minister or renaming the position to give it more weight is not possible — the role of Defense Minister is explicitly defined in the Constitution.

In any case, according to RBC-Ukraine, the concept of transferring Shmyhal to the Defense Ministry appeared during private discussions between President Volodymyr Zelenskyy and Davyd Arakhamia, a close ally of Shmyhal who had previously blocked attempts to remove him from office.

A source from the Servant of the People party told the outlet that, for many MPs, the main event in the current personnel reshuffle is Shmyhal’s move to the Defense Ministry, not the appointment of Yuliia Svyrydenko as Prime Minister.

In fact, there’s little surprise in Svyrydenko’s appointment — for some time now, she had been seen as the only serious candidate to replace Shmyhal if he stepped down. She has the backing of the Head of the Presidential Office, Andriy Yermak, as well as a few successful (at least from the point of view of the Presidential Office) cases under her belt, such as negotiating the minerals deal with the US. According to the outlet’s sources, she also has strong ties with various business associations.

Svyrydenko will receive significant support in her new role from an experienced figure in the executive branch — Vice Prime Minister and Digital Transformation Minister Mykhailo Fedorov. He is set to be promoted to First Vice Prime Minister and will oversee nearly half the Cabinet.

"The idea is this: Svyrydenko and Fedorov are tasked with building an investment climate — basically, to generate money. And Shmyhal’s job is to spend that money as effectively as possible. These are the two key elements," a source close to the President told RBC-Ukraine.

EU and NATO in the spotlight

"It would be nice if the people in the new Cabinet should at least not be suspected of criminal cases," one MP from the Servant of the People party said ironically in a conversation with the outlet.

By this criterion, Deputy Prime Minister of Ukraine and Minister of National Unity of Ukraine, Oleksiy Chernyshov, was automatically ruled out. Moreover, his story involving a prolonged foreign assignment and a criminal case was seen by the authorities as a serious reputational blow, which became another trigger for the government reshuffle.

In addition, the Ministry of Culture will get a new head, now without the strategic communications component, which will be transferred to another agency (which one, however, remains unknown). Mykola Tochytskyi, described by the outlet’s sources as a competent diplomat, found himself in the wrong role at the Culture Ministry. He is now expected to return to his core area — diplomacy.

In his place, an offer to head the ministry was extended to Veronika Seleha, director of a creative agency who previously led the humanitarian policy department in the Presidential Office during the early months of Zelenskyy’s term. (Before Seleha, the position was offered to other female candidates, but they declined.) Importantly, sources describe Seleha as a close acquaintance of Yuliia Svyrydenko.

Volodymyr Zelenskyy and Yuliia Svyrydenko (photo: facebook.com/yulia svyrydenko)

Thus, the new Prime Minister would get another trusted person in the government — something Svyrydenko currently lacks. Among those she can consider her allies is her deputy at the Ministry of Economy, Oleksii Sobolev, who is now expected to receive a promotion and head the Ministry. Moreover, the Ministry of Agrarian Policy and the Ministry of Ecology will be merged into his department as part of the general concept of "optimization of the executive branch." However, this is not the first experiment of this kind involving the merging of ministries, and the previous ones can hardly be called successful.

Also, the Minister of Social Policy, Oksana Zholnovych, will lose her post. Reportedly, the leadership has long been dissatisfied with her work.

— On the other hand, this is the kind of ministry where you will never be considered good if there’s never enough money for social programs. So, probably, it’s a place where you just need to change the minister once a year, — said one of RBC-Ukraine’s interlocutors within the government.

For now, the position of Minister of Social Policy has been given to the First Deputy Minister of Finance, Denys Uliutin. For a long time, there were reports that the Ministry of Veterans could also be merged into the Ministry of Social Policy, but this idea was ultimately abandoned.

Perhaps the biggest intrigue and the fiercest competition during this government reshuffle unfolded around the Ministry of Justice and the Ministry of European and Euro-Atlantic integration. In the current government, these positions were held jointly by Olha Stefanishyna, with the explanation being that negotiations on EU accession, which she was responsible for, are primarily about legislative changes, making the Ministry of Justice a logical fit.

However, it was decided to remove Stefanishyna, which came as a surprise to many (including European partners), and to split the positions of Vice Prime Minister for EU/NATO again from the Ministry of Justice.

Two main candidates were seriously considered for the Ministry of Justice: Iryna Mudra from the Presidential Office and German Galushchenko, the current Minister of Energy. On Tuesday evening, sources told RBC-Ukraine that Galushchenko would indeed take over the Ministry of Justice. His place in the Ministry of Energy will be taken by the head of the Ministry of Ecology, Svitlana Hrynchuk, who would otherwise be left without a post following the liquidation of her ministry.

Meanwhile, the competition for the post of the Vice Prime Minister of the Ministry of European and Euro-Atlantic integration remained unresolved until the very last moment. It was assumed that it would go to Deputy Minister of Economy and Trade Representative Taras Kachka, especially given his considerable experience in negotiations with Europeans on trade quotas. Svyrydenko actively lobbied for Kachka’s appointment as her deputy.

At the same time, another candidate emerged, strongly supported by Stefanishyna, who is leaving the Cabinet — Ukraine’s ambassador to the EU, Vsevolod Chentsov (it is assumed that Stefanishyna herself will take his current position anyway). As of late Tuesday evening, sources insisted that Svyrydenko had managed to secure Kachka’s appointment, though they admitted that the situation could still change.

Denys Uliutin, left, and Taras Kachka, right (photo: Vitalii Nosach / RBC-Ukraine)

A fierce struggle also unfolded around the position of Minister of Education. Many MPs had accumulated questions for Minister Oksen Lisovyi, and even the name of his possible successor was mentioned — his deputy, Andrii Vitrenko, against whose appointment student protests had already taken place.
The situation escalated to the point where some MPs threatened to derail the package vote on the composition of the Cabinet, demanding that each minister be considered and approved separately. This would have delayed the process and significantly increased the risk of failure altogether, as there might not have been enough votes. However, yesterday, at the governmental level, a series of meetings were held with the dissatisfied MPs, and their grievances were reportedly resolved. Lisovyi also received support from Vice Prime Minister Fedorov.
Thus, members of the Cabinet, except for the Ministers of Defense and Foreign Affairs, will be approved as a package. Parliamentary sources told RBC-Ukraine that the vote margin is not large but sufficient: 235–240 votes in favor, of which about 180 come from the Servant of the People. Additionally, there is support from MPs from Trust, For the Future, and remnants of Opposition Platform – For Life (OPZZh) — in other words, there should be enough votes, and no surprises are expected.
At the same time, there was no special active collecting of votes for the initiative. This is not surprising because the main collector, faction leader Davyd Arakhamia, would hardly have approached this task with much enthusiasm. One of the main political outcomes of the current personnel reshuffle, as RBC-Ukraine has already reported, is that in the long-standing struggle between Andriy Yermak and Davyd Arakhamia for influence and Zelenskyy’s attention, the former has finally prevailed.
— Overall, what do you think — at least it won’t get worse? — RBC-Ukraine asked one of the experienced MPs from the ruling party about the prospects of life under the new Cabinet.
— No. Well, it shouldn’t. There is potential; we'll see — the interlocutor replied.