Ukraine's Orange rebels splinter

The crisis came to a head last week when President Viktor Yushchenko's chief of staff, Olexander Zinchenko, resigned claiming the president's inner circle was riddled with graft. Mr. Yushchenko, who endured poisoning and a fraud-induced electoral defeat to rally Ukrainians in a battle for honest polls last year, responded to the charges by sacking the entire government.

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While that battle included fiery populist Prime Minister Yulia Tymoshenko, she was also fired in the surprising shake-up. Also sacked was the main target of Mr. Zinchenko's charges, Petro Poroshenko, chief of the Security and Defense Council and top Yushchenko ally.

The stage is now set for an acrimonious face-off between the formerly united pro-Western democrats in parliamentary elections next March, which could facilitate a comeback by forces of the previous regime, led by Viktor Yanukovich, who remain strong in Ukraine's heavily Russified east.

But many experts say the falling-out among the Orange revolutionaries was probably inevitable and need not be fatal to Ukraine's struggling democracy.

"What we're seeing here is the end of the bright and shining myth, born in the streets of Kiev last year, that Yushchenko and Tymoshenko were completely like-minded leaders," says Alexander Shushko, an expert at the Institute of Euro-Atlantic Integration in Kiev. "We always knew they were together for political convenience; the contradictions and competition between them was never a secret."

Yury Yekhanov, a liberal economist with a reputation for political neutrality, was named acting prime minister. "Perhaps now we'll have a government of technocrats, who will turn to problem-solving," says Irina Podlutska, president of the independent Europe XXI Foundation in Kiev. "Maybe this will give Yushchenko some breathing space, enable him to strengthen his team and work on long-range strategy for the country."

Ms. Tymoshenko, whose popularity outpaces Yushchenko's, lashed back after her firing. "With this decision [Yushchenko] destroyed our unity ... our future and the future of the country," she said. "Today we are definitely two different teams, and these teams will go their separate ways."

In recent months Yushchenko had repeatedly criticized Tymoshenko for populist measures, such as raising pensions and imposing price controls on energy. She was also accused of stalling over the crucial review of businesses that were privatized, through alleged fraud and corruption, during the previous regime of Leonid Kuchma.

Under Tymoshenko's stewardship, Ukraine's economic growth has plunged to just 3.7 percent in the first half of this year compared to almost 14 percent in the same period of 2004. Inflation has soared, eating away at the country's meagre buying-power.

In his resignation speech, Zinchenko named Mr. Poroshenko and top presidential aide Alexander Tretyakov and the parliamentary leader of Yushchenko's "Our Ukraine" party as "corrupt officials" who have derailed hope for transparent governance in Ukraine. "I have named only the first-rank group," he said. "The list would be much longer if I mentioned everyone who is an obstacle to Ukraine's development."

• Olga Podolskaya in Moscow contributed to this report.