Zelenskyy's government reshuffle: Svyrydenko out, Koretskyi in the Cabinet, questions over Fedorov

On Sunday 12 July, something that the President's Office on Bankova Street had been preparing for for several weeks finally happened – though few had expected it to happen quite so soon.

President Volodymyr Zelenskyy decided to carry out an early government reshuffle. Prime Minister Yuliia Svyrydenko's cabinet did not survive long enough to see its first official anniversary, which would have been on 17 July.

The prime minister had only recently presented Ukraine's new 15-year economic strategy, yet by Sunday the president had asked her to step down.

In a sense, Svyrydenko's entire tenure as prime minister was bracketed by two Ukraine Recovery Conferences. She was appointed after last year's forum in Rome and resigned after the conference in Gdańsk.

Although rumours of her resignation had been swirling for the last month or so in political, government and parliamentary circles, most of Ukrainska Pravda's sources had predicted the Cabinet reshuffle no earlier than August.

But it all happened much faster.

According to Ukrainska Pravda's sources, the immediate trigger for the rapid government changes was an unexpected conversation the president had at Bankova Street last week.

Ukrainska Pravda has looked into what prompted Zelenskyy to speed up the Cabinet reset, why the resignation has happened now, which candidates are genuine contenders as the next prime minister, and what lies at the heart of the current rotation.

Svyrydenko's unexpected resignation

The news that Yuliia Svyrydenko was stepping down came as a surprise to many – including Yuliia Anatoliivna herself, who was effectively presented with a fait accompli.

Yet on closer examination of the processes that have been unfolding within the government over recent months, the decision appears entirely logical.

The first reason that made change inevitable was the shift in the balance of power following the investigation, dismissal and corruption charges against the former head of Zelenskyy's Office, Andrii Yermak.

Svyrydenko's cabinet had been formed around Yermak, and after his dismissal the new heavyweights wanted their share of influence – even though Svyrydenko herself had urged the president to dismiss Yermak and sought to avoid being associated exclusively with him.

Officially there has been no change in the parliamentary majority that forms the government. But the real architecture of power has undergone a radical transformation: the model in which the president retains the role of sole leader has been consolidated, but his inner circle has grown to encompass an entire group of decentralised centres of influence.

The second reason for the government reshuffle was the president's gradual fatigue with the "government babysitting" model, as cooperation with the Cabinet is referred to within Zelenskyy's team.

Svyrydenko was perfect for a system in which the head of the President's Office personally set almost all the tasks for the government and the prime minister coordinated virtually every step with Bankova Street.

Over time, however, this way of doing things began to frustrate the president himself. According to Ukrainska Pravda's sources, Zelenskyy came to expect independent decision-making from the prime minister rather than sign-offs on every minor detail. At some meetings he was even known to say something along the lines of "Well, you should be able to handle this without me at least."

Strategic decisions will, of course, remain within the president's remit. But operational management of the government is to pass to the new prime minister, who will be expected to deliver not just endless sign-offs with Bankova Street, but independent initiatives, ready-made managerial decisions, and personal accountability for their implementation.

The third reason for the cabinet reshuffle is the calendar.

Ukraine has already been through the main international events of the summer political season: negotiations with financial partners, the NATO summit, the Ukraine Recovery Conference, and so on.

A few weeks of relative calm have opened up before the autumn political season begins. This window will enable the new prime minister to assemble a team without undue haste, take over the management of the government, and get ready for autumn.

The fourth, less obvious reason is the systemic conflict between Defence Minister Mykhailo Fedorov and every single grouping that has grown up around the defence budget over the years of the full-scale war – from the generals' clans around the commander-in-chief to the purely commercial groups embodied by several parliamentary and President's Office-adjacent figures.

Fedorov is ostensibly being criticised for the "wrong kind" of mobilisation and procurement reform, but the real reason they want him gone is that having boarded the corruption train, he chose to pull the emergency brake rather than ordering an espresso and riding along with everyone else. The passengers in the first-class corruption carriages did not appreciate this.

And now "Mindich's president" is wrestling with the "president of reforms" in his own deliberations – whether to stick with an aggressive minister whose public trust provided cover after the disgraceful corruption scandals, or to move forward with his "old friends" and leave the system intact.

The main reason, however, lies elsewhere: Bankova Street has finally reconciled itself to the fact that there won't be elections this autumn. Instead, Ukraine will have to prepare for what may be the hardest winter of the full-scale war.

The government believes that before the cold sets in, Russia will attempt to finish off whatever remains of Ukraine's electricity network, gas production and fuel infrastructure – in short, everything that's left of the energy system.

Dynamic preparation for this campaign will be the new government's primary task.

All of the problems described above have been gradually building up over recent months. The president kept them in view, but saw no reason to rush into a major Cabinet reset.

It had to be done at the right moment. And that moment arrived unexpectedly.

Last week, according to Ukrainska Pravda's sources on Bankova Street, Olha Stefanishyna, Ukraine's ambassador to the United States, came to the president and informed him that she intended to leave the diplomatic service.

Several factors lay behind this decision. One is that Stefanishyna is highly likely to be served with a notice of suspicion by the National Anti-Corruption Bureau of Ukraine (NABU) in respect of an old case that arose long before her appointment as ambassador. The second reason is purely personal. Stefanishyna has spent many years working tirelessly on European integration and relations with the EU and US. Now she wants to take a break– to deal with her legal issues, get some rest, and ultimately simply earn some money.

For Zelenskyy, this unexpected resignation proved to be an opportunity rather than a problem.

The vacancy in Washington could be used to resolve several personnel questions at the same time.

Last year, the need to appoint a new ambassador to the US was the occasion for a major government reshuffle and the appointment of Svyrydenko's cabinet. Now the situation was almost repeating itself.

On 12 July, the president invited Yuliia Svyrydenko to meet with him and offered her the job of Ukraine's ambassador to the US. According to Ukrainska Pravda's sources, the prime minister had not expected this turn of events, but she agreed.

It is, after all, precisely the type of offer that is almost never refused within the presidential team.

All the more so because since the beginning of the summer, people who worked closely with Svyrydenko had noticed a change in her: she had become increasingly cautious about taking on long-term projects and was dropping more frequent hints that she wasn't sure she would still be prime minister by the autumn.

So the prospect of resigning came as no surprise to her. She had been part of Zelenskyy's team for long enough not to be shocked by sudden political twists and turns.

The new PM: four names, but only one real contender

After speaking with Svyrydenko, the president moved on to the second stage of the process – finding her successor.

Officially there were several candidates. As soon as the news of Svyrydenko's departure broke, Davyd Arakhamiia, leader of the Servant of the People parliamentary faction, sent a message to MPs in the faction's internal chat listing four names: Mykhailo Fedorov, Serhii Koretskyi, Denys Shmyhal and Ihor Terekhov.

In reality, however, the candidates were not all considered equally serious ones, and some were never genuine contenders for the post.

According to Ukrainska Pravda sources, Zelenskyy asked Defence Minister Mykhailo Fedorov whether he would be willing to head the government during conversations on Saturday 11 and Sunday 12 July.

Fedorov declined. He only moved to the Ministry of Defence a few months ago and had only just begun implementing his own vision for reforming the ministry. If he left in the run-up to winter, the whole process would have to be restarted from scratch.

For that reason, Sunday's conversation between the president and Fedorov was more of a working meeting than a proper interview for the post of PM.

Servant of the People MPs have said that afterwards, the defence minister reassured his colleagues that everything was fine and he would be continuing in his current role.

But several Ukrainska Pravda sources within the governing team believe the situation is not quite so straightforward. There is a possibility that Zelenskyy could instead offer Fedorov a return to the Ministry of Digital Transformation, which he previously headed, or another token government position.

For this reason the president reportedly also asked Interior Minister Ihor Klymenko to be prepared for a possible move to the Defence Ministry. Klymenko is considered personally loyal to the president, and Oleh Tatarov, Deputy Head of the President's Office, still has considerable influence over his ministry.

Should that appointment take place, the Interior Ministry could be headed by Ivan Vyhivskyi, the current chief of the National Police. In other words, Klymenko was never seriously considered as a future PM.

As a result, the situation could ultimately lead to a falling-out between Zelenskyy and Fedorov. For Fedorov, that would mean a period of political uncertainty; for Zelenskyy, it could mean losing a significant share of the public support generated by Fedorov's energetic reforms at the Ministry of Defence.

It would be difficult to interpret the minister's removal as anything other than punishing him for being effective in order to please vested interests or corrupt figures. But the president evidently believes there is someone else capable of commanding similar public trust if the defence minister were replaced.

Kharkiv Mayor Ihor Terekhov's chances of becoming PM were even slimmer than Klymenko's.

Terekhov has been appearing increasingly frequently on the national political stage. According to Ukrainska Pravda sources in political circles, this has been greatly encouraged by Davyd Arakhamiia. He sees Terekhov as one of the potential leaders of a future political project bringing together successful regional administrators – effectively a party of experienced local executives. Other possible members could include Vitalii Kim, Head of Mykolaiv Oblast Military Administration, and other regional leaders who have earned strong reputations during Russia's full-scale invasion. Ukrainska Pravda first reported on this political project in October last year.

This explains why the president's meeting with Terekhov was primarily political in nature.

Zelenskyy and Terekhov discussed the situation in Kharkiv, preparations for the coming winter, and the possibility of the mayor taking on a role in central government.

Terekhov reportedly thanked the president for his confidence in him, but said he wished to remain mayor of Kharkiv. He then returned to the city, having strengthened his image as someone the president considers capable of serving at a national level and boosting his political ratings by an estimated two or three percentage points in the process.

The president also held a separate meeting with Denys Shmyhal, but he did not seriously offer him the chance to lead the government. That is because the president had only one genuine favourite: Serhii Koretskyi, the current CEO of Naftogaz, Ukraine's state-owned oil and gas company.

Zelenskyy has followed Koretskyi's work closely in recent years and regards him as one of Ukraine's strongest public-sector managers, particularly after his leadership of Ukrnafta. The state-owned oil company had been making huge losses when Koretskyi took over, but he succeeded in turning it into a highly profitable business.

According to sources, Koretskyi himself was genuinely surprised by the offer.

He had assumed in theory that such a conversation might happen one day, but he definitely had not expected it during that particular meeting.

The president asked him just one question: if the need arose, would he be prepared to lead the government? Koretskyi's answer was yes.

According to Ukrainska Pravda sources at the President's Office, Koretskyi openly admitted that he did not yet fully appreciate the scale of the challenges that await him. Nevertheless, he said he was willing to take on the job.

The president outlined the key priorities for the future Cabinet: preparing Ukraine for what is expected to be its hardest winter yet, protecting the country's energy and fuel infrastructure from Russian attacks, stabilising the economy, and ensuring that international financial aid is managed effectively.

The president has also announced an upcoming reshuffle in Ukraine's security leadership. As far as Ukrainska Pravda understands, this includes the possible changes at the Defence and Interior Ministries we have already mentioned. But they won't be the only changes.

The president is also considering appointing Oleksandr Poklad, currently the first deputy head of the Security Service of Ukraine (SSU), as the agency's permanent chief. However, it appears highly doubtful that Parliament would currently approve such an appointment. After seven years under the current administration, MPs have become much more cautious about confirming senior security officials without first seeing them serve in an acting capacity.

That means Zelenskyy's only option would be to appoint Poklad as acting head of the SSU by presidential decree.

That could potentially lead to a confrontation between the president and Kyrylo Budanov, Head of the President's Office. For now the relationship between Budanov and Poklad could not be described as an outright personal feud, but it's moving in that direction.

***

After Sunday's meetings, President Zelenskyy outlined his decisions in a series of social media posts before heading off on his latest international trip.

"That's classic Zelenskyy," one source in the president's team joked.

"The president sets the process in motion and then goes abroad on a working visit so that over the next few days, we argue amongst ourselves, make peace again, and then present him with a finished solution," one influential member of Zelenskyy's team said with a smile.

As of Monday morning, only one decision appeared to have been finalised: the resignation of Yuliia Svyrydenko.

After that, the governing coalition and the president are expected to complete consultations on all the remaining senior appointments. Most of those decisions are still under discussion, including the overall composition of the future Cabinet, which ministries will remain, which may be merged or split, and who will head them.

The various lists of names circulating on Ukrainian mainstream and social media are likely to change repeatedly, making it pointless to post them as if they were final.

At present, only one name stands out as Svyrydenko's potential successor: Serhii Koretskyi. Unless something extraordinary happens.

Roman Romaniuk, Ukrainska Pravda

Translated by Anastasiia Lipara and Tetiana Buchkovska

Edited by Teresa Pearce