Foreign Correspondence

[Amaunet]

Ukraine's Former Prime Minister Leads in Vote, Exit Poll Shows

Oct. 31 (Bloomberg) -- Viktor Yushchenko, Ukraine's former prime minister who is seeking to bring the country closer to the European Union, won the first round of voting to choose a successor to President Leonid Kuchma, an exit poll showed.

Yushchenko took 45.2 percent of the vote, according to polls released after the end of balloting by an independent group including the Democratic Initiatives and Socis center. Prime Minister Viktor Yanukovych, who has the backing of Kuchma and Russian President Vladimir Putin, probably won 36.8 percent of the vote in the first round, the poll showed.

``If Yushchenko wins, the market will react positively,'' said Dmitri Shemetilo, an emerging markets strategist at Commerzbank AG, Germany's third-largest bank, in a telephone interview in London before the vote. ``If Yanukovych wins, there will be opposition on the streets and bonds will fall and this is the moment to buy.''

Ukraine ranked 122 out of 145 countries in Transparency International's Corruption Perceptions Index for 2004, trailing Uzbekistan and Zimbabwe. Human Rights Watch said Kuchma's administration ``blatantly violates freedom of expression'' in the media. The International Monetary Fund hasn't lent Ukraine money since 2001, when the fund said Kuchma's government failed to honor its agreements.

Official results are expected tomorrow morning in this country of 47 million and a second round will be held Nov. 21 between the top two finalists, the government has said. The vote was monitored by international observers amid charges by opposition politicians, including Yushchenko, that the government would try and falsify the election for Yanukovych.

The independent exit poll was taken at 2 p.m. Kiev time and surveyed 50,000 voters. The margin of error was 1.6 percent.

Two other exit polls released after the vote ended said Yanukovych took 43 percent and 43.5 percent of the vote respectively. Yushchenko had 39 percent of the vote in both polls which were conducted the Public Opinion Foundation and a consortium headed by the Ukrainian Institute for Social Studies.

Yanukovych and Yushchenko were trailed by Socialist Party leader Oleksandr Moroz with about 6 percent. Communist Party leader Petro Symonenko had about five percent, the polls said. None of the other 20 candidates running for the presidency had more than 1.5 percent in any of the polls.

Widespread Protests

Yushchenko, 50, has rallied hundreds of thousands to protest against Kuchma's regime during the campaign. He has pledged to investigate the current government. Kuchma and Putin have praised Yanukovych for supporting economic growth.

Ukraine's gross domestic product will expand as much as 13 percent this year, after growing 9.4 percent last year, the International Monetary Fund predicts. Consumer inflation will accelerate to as much as 12 percent in 2004 and about 10 percent in 2005, compared with 8.2 percent in 2003.

Yanukovych, 53, the former mayor of Donetsk, a city in eastern Ukraine, focused his campaign in eastern regions, where most of the population speaks Russian and seeks closer ties with Russia. Yanukovych promised dual citizenship with Russia and pledged to make Russian the second official language in Ukraine.

Yushchenko, prime minister from 2000 to 2001, won praise from the IMF, World Bank and EU for his efforts to cut bureaucracy, reduce corruption and improve relations with other nations. He has pledged to speed up asset sales, cut taxes and consider rescheduling some government debts to help sustain economic growth and improve living standards.

``If Yanukovych wins it will be a significant setback for Ukraine,'' said Paul Mcnamara, who helps manage about $500 million of emerging-market assets at Julius Baer Investment Management in London and owns Ukrainian Eurobonds. ``The choice is between following Poland and following Russia.''



Last Updated: October 31, 2004 13:57 EST

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