Bloomberg News

Ukraine Demotes Deputy Premier Klyuev to Security Council

February 15, 2012

(Updates with comment from analyst in fourth paragraph.)

Feb. 14 (Bloomberg) -- Ukraine’s President Viktor Yanukovych demoted First Deputy Prime Minister Andriy Klyuev, the third time this year he’s removed a senior Cabinet official.

Klyuev, 47, who was also economy minister, will take over from Raisa Bohatyriova as secretary of the National Defense and Security Council, Yanukovych said today in a decree on his website. Bohatyriova was named deputy prime minister and health minister. Klyuev’s replacement wasn’t named. No reasons were provided for the moves.

Yanukovych fired Finance Minister Fedir Yaroshenko last month as the former Soviet republic seeks to kick start a $15.6 billion bailout that’s been frozen since last March. Klyuev, who’d been in his position since March 2010, led talks with the International Monetary Fund over the loan program as well as negotiations to strengthen ties with the European Union through a so-called Association Agreement.

“His new job is a demotion,” Alexander Valchyshen, head of research at Investment Capital Ukraine in the capital, Kiev, said by phone. Finance Minister Valery Khoroshkovsky, a former head of the Security Service, may be “a likely candidate” to replace him as first deputy premier, he added.

The yield on Ukrainian government bonds due 2016 fell to 9.860 percent, the lowest level since Feb. 2, as of 5:50 p.m. in Kiev, data compiled by Bloomberg show.

Yanukovych, whose ruling Party of Regions trails in opinion polls before parliamentary elections in October, fired Defense Minister Mykhaylo Yezhel Feb. 8.

--Editors: Andrew Langley, Jeffrey Donovan

To contact the reporters on this story: Daryna Krasnolutska in Kiev at; Kateryna Choursina in Moscow at

To contact the editor responsible for this story: Balazs Penz at

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