No. 232, 09 December 1991

USSR--ALL-UNION AND INTER-REPUBLICAN TOPICS



SLAVIC LEADERS ESTABLISH COMMONWEALTH OF INDEPENDENT STATES.
At the end of a two-day meeting in seclusion in a Belorussian
village outside Brest, Russian President Boris Yeltsin, Belorussian
Supreme Soviet Chairman Stanislau Shushkevich, and Ukrainian
President Leonid Kravchuk announced that they had agreed on December
8 to establish a "commonwealth of independent states" comprising
the three Slavic republics and open to all republics of the former
USSR and other states sharing the commonwealth's goals and principles.
TASS issued a proclamation by the heads of state of the Republic
of Belorussia, the RSFSR, and Ukraine; the principles of the
commonwealth agreement; and a declaration on the coordination
of economic policy. The three sides, as founding members of the
USSR and signatories of the 1922 Union treaty, bore witness to
the end of the USSR "as a subject of international law and a
geopolitical reality." The new commonwealth will strive for coordination
in the spheres of foreign policy, development of a common economic
space, customs and migration policies, transport and communications,
ecology, and crime fighting. The members pledged to take measures
to reduce defense spending, eliminate nuclear weapons, and work
toward neutrality, and they envision a series of future agreements
in a wide range of areas. (Kathy Mihalisko)

COMMONWEALTH'S COORDINATED ECONOMIC POLICY. Late on December
8, TASS carried the text of the "Declaration by the Governments
of Belorussia, the RSFSR, and Ukraine on Coordination of Economic
Policy." Highlights were: the maintenance and development of
existing close economic ties between the three states; the promised
creation of fully-fledged market mechanisms; the "transformation"
of property relations; the retention of the ruble as a basis
for economic relations, while introducing national currencies
with mutual safeguards; the preservation of a unified economic
space; and a pledge to agree on 1992 defense expenditure within
10 days. (Keith Bush)

MINSK CHOSEN AS COORDINATING CENTER. The agreement signed on
December 8 states that Minsk has been chosen as the official
point of coordination for the organs of the new commonwealth.
The activities of organs of the former USSR become null and void
in the states that have signed the commonwealth agreement. (Kathy
Mihalisko)

YELTSIN ADDRESSES BELORUSSIAN PARLIAMENT. Giving what essentially
was a prelude to the Brest commonwealth agreement, Yeltsin on
December 7 told the Belorussian Supreme Soviet that "we have
seen the failure of the idea of a half-federation, half-confederation
that would bind each state under a system of dual power." In
remarks to Radio Moscow on December7, Shushkevich, the only one
of the threeSlavic leaders in Brest who has not been popularly
elected (and the only one who was not a former Communist Party
official) said that USSR President Mikhail Gorbachev was guilty
of trying to maintain the Union's old attributes. (Kathy Mihalisko)


GENERAL STAFF CHIEF SACKED. Only one day after concluding a high-profile
visit to Great Britain, Army General Vladimir Lobov was removed
as Chief of the Soviet General Staff by order of Gorbachev. Interfax
reported on December 7 that, according to well-placed sources,
Lobov had been replaced "for reasons of health" and because of difficulties
reforming the armed forces. Neither explanation is convincing.
Interfax reported that a Defense Ministry spokesman had called
the firing "unexpected," and the news agency also mentionedunofficial
reports that Lobov had resigned over developments in Ukraine
and elsewhere that threatened the unity of the armed forces.
(Stephen Foye)

LOBOV REPLACED BY SAMSONOV. The Commander of the Leningrad Military
District, Colonel General Viktor Samsonov, has been named to
replace Lobov, Soviet and Western sources reported on December
7. The 50-year-old commander is best known for his role in the
August coup when, at the behest of Leningrad Mayor Anatolii Sobchak,
he refused to send troops into the city. By all accounts, however,
Samsonov is no radical. A Radio Rossii commentary on December8
characterized him as a firm proponent of a unified military who
has run his own district with an iron hand. Samsonov also lacks
the strongtheoretical background of his predecessor. (Stephen
Foye)

TOWARDS A NEW BANKING STRUCTURE? In a series of interviews granted
to The Wall Street Journal, The Financial Times, and Western
agencies on December 6, the chairman of the Russian Central Bank,
Georgii Matyukhin, and one of his deputies, Dimitrii Tulin, aired
their views on the future banking structure in the former USSR.
Although the Russian bank has been expected to assume the functions
of the USSR Gosbank in January 1992, their positions differ from
already announced RSFSR policies, not to mention previous central
guidelines. It is known that the Russian leadership would like
to replace Matyukhin by Boris Fedorov (currently detached to
the EBRD). But the present infighting may well have been rendered
irrelevant by the events of the weekend. (Keith Bush)

SILAEV COMMITTEE AT WORK, BUT TO WHAT PURPOSE? In meetings December
4-6, the Inter-State Economic Committee met under the chairmanship
of Ivan Silaev and reached agreement on several key points, TASS
reported December 7. Among the most important were the establishment
of a special committee to oversee the foreign debt problem (the
committee met December 6 but could not elect a chairman because
it could not reach a quorum); and agreements on coordinating
price liberalization and economic reform measures. In many respects,
however, agreements among the various successor states and between
them and foreign governments and international organizations
will likely take precedence. Silaev said that a full package
of agreements on inter-state economic relations could well be
ready for signing in Minsk on December 12 and that these agreements
would constitute a new economic arrangement. But the trilateral
agreement between Russia, Ukraine, and Belorussia would seem
to render much of Silaev's efforts pointless. (John Tedstrom)


AGREEMENT ON FOREIGN DEBT. Despite the creation of the "Slavic
Commonwealth," there is bound to be great interest in the agreement
Silaev's group reached on the foreign debt of the former USSR.
In particular, the statement issued by the committee on December
6 (it was signed December 5) said that the extraordinary economic
conditions in the country dictated that the Bank for Foreign
Economic Affairs only make interest payments on the foreign debt
(now totalling about $67 billion) at this time. The agreement
established a committee with responsibility for oversight of
the debt problem, and said that that committee would work with
the IMF and other international organizations on questions of
monetary and fiscal reform and debt payment. (John Tedstrom)


WESTERN BANKS WANT CLARIFICATION ON FOREIGN DEBY. According to
Soviet and German press reports December 6 and 7, a group of
commercial bankers met in Frankfurt December 6 to discuss the
foreign debt of the former USSR. Led by Deutsche Bank, the group
focused on the problem of rescheduling the debt in an orderly
fashion. The situation was complicated during the trilateral
agreement reached by Ukraine, Belorussia, and the RSFSR December
8. Although there is agreement in principle among the three it
seems as if the details of a rescheduling program remains to
be worked out. At this point it is simply not clear which body
has ultimate responsibility for servicing the debt. (John Tedstrom)


RUSSIA AND UKRAINE AGREE ON DEBT TO HUNGARY. In a related development,
Hungary's prime minister, Jozsef Antall, on December 7 reached
agreements with Moscow and Kiev on their share of Soviet debt
owed to Hungary. The agreements indicate that Ukraine and Russia
might pay with commodities instead of money. Payments are to
begin next year. Details about the size of the debts to be repaid
and over what period are not yet available. (John Tedstrom)



USSR--REPUBLICS AND SUCCESSOR STATES



DNIESTER SITUATION. In successive press releases and news conferences
in Kishinev on December 6 through 8, Moldavia's Ministry of Internal
Affairs and Central Electoral Commission reported that joint
detachments of "Dniester SSR" armed guards and uniformed Soviet
soldiers besieged or took over several police and other law enforcement
and government offices in eastern Moldavia. Such piecemeal takeovers
have been under way since September in the Dniester area, but
these are the first with military participation. The armed detachments
also continued to enter Moldavian villages to dissuade residents
from voting in Moldavia's presidential election on December 8,
and they closed down some polling stations. Army helicopters
overflew Moldavian villages dropping leaflets urging residents
not to vote. (Vladimir Socor)

MOLDAVIA APPEALS TO UN OVER "POLITICAL-MILITARY PUTSCH." Moldavian
President Mircea Snegur, parliament chairman Alexandru Mosanu,
and Prime Minister Valeriu Muravschi appealed on December 6 to
the United Nations over "a political-military putsch" in eastern
Moldavia. They said that paramilitary detachments of the would-be
"Dniester republic" and local Soviet army units had "started
an overt aggression against Moldavia, occupying raion centers
and settlements," being abetted by the USSR Ministry of Defense
and other "central power structures." The Moldavian leaders urged
that observers from the UN and other international organizations
be sent to monitor the situation. (Vladimir Socor)

SOVIET GENERAL'S "DNIESTER" APPOINTMENT CONFIRMED. The appointment
of Lt. Gen. Gennadii Yakovlev, Commander of the 14th Army, as
Chief of Defense and Security of the "Dniester SSR" (see Daily
Report, December 6) was confirmed by the would-be republic's
officials to Western agencies on December 6. Moreover, Lt. Gen.
Yurii Kuznetsov, First Deputy Commander of the Odessa Military
District and Yakovlev's hierarchical superior, told Ukrinform/TASS
on December 7, as cited by Radio Moscow that day, that "Yakovlev's
agreement to take on the duties of defense chief for the Dniester
republic is his own affair." Moldavia's Ministry of Internal
Affairs meanwhile told Moldovapres on December 7 that units of
the 14th Army are to become the "Dniester SSR"'s regular army
by January 1992. (Vladimir Socor)

MILITARY INTERVENTION DENIED. Kuznetsov said that "not a single
Soviet army soldier participated in the activities imputed to
us." He claimed that "Dniester republic" paramilitary detachments
were dressed in Soviet army uniforms "which they obtained we
don't know where," and that they had "received their arms from
the militia" (apparently meaning the Moldavian police stations
recently seized by the "Dniester SSR"). Kuznetsov claimed that
he had rebuffed Dniester leader Igor Smirnov's request for military
deployment in the Dniester area and Smirnov's subsequent threat
to seize arms from the military. The claim looks implausible,
given the military's well-documented support for the "Dniester"
paramilitary force and the placement of the 14th Army under "Dniester"
authority. (Vladimir Socor)

SHAPOSHNIKOV IGNORES APPEALS--BUT DEMANDS FUNDS. Snegur told
a news conference on December 6 and an electoral meeting on December
7 that he had cabled USSR Defense Minister Evgenii Shaposhnikov
and had sought to contact him by telephone in connection with
the troop movements in eastern Moldavia, but Shaposhnikov ignored
the cables and calls. However, the Moldavian government received
a message from Shaposhnikov demanding from Moldavia an allegedly
overdue sum of 1.2 billion rubles to the USSR military budget,
Snegur's press office informed RFE/RL. Since proclaiming independence
in August, Moldavia ceased contributing to the USSR military
and space budgets. (Vladimir Socor)

ROMANIA CONDEMNS SOVIET ARMY INTERFERENCE IN MOLDAVIA. On December
7 the Romanian Foreign Ministry strongly condemned the Soviet
army for its alleged arming of Russian separatists in order to
disrupt the presidential election in Moldavia, Romanian media
and Western agencies reported. The statement mentioned Romania's
"great concern" about the situation and said that "such illegal
acts supported by military forces worsen the situation in the
region." The statement demanded "the immediate withdrawal from
the territory of the Republic of Moldavia of the armed forces
which jeopardize its sovereignty." (Crisula Stefanescu)

MINIMUM WAGE TO BE RAISED IN RSFSR. The RSFSR Supreme Soviet
agreed on December 6 to raise the minimum wage level to 342 rubles
per month for workers in organizations financed by the state
budget. The increase will take effect January 1, 1992. Off-budget
enterprises and organizations must introduce the same minimum
wage in the first quarter of 1992. Radio Moscow carried the announcement
December 6, but made no mention of increases for pensioners,
the unemployed, or the disabled. These groups are extremely hard
hit in the current inflationary environment, and increases in
their payments should be expected. Increases of budgeted salaries
and payments will put further pressures on the Russian budget,
already running in deficit with little scope for increased revenues.
(John Tedstrom)

SILAEV BLAMES FOOD CRISIS ON RUSSIAN REGIONS. Ivan Silaev, de
facto Soviet Prime Minister, has complained that the food crisis
in Moscow is a result of the failure of Russian regions to meet
their supply obligations. He told a news conference December
7 that the regions are only supplying about half of what they
should be and that Moscow will begin bartering with them for
increased supplies. Moscow has been authorized to trade up to
15% of the goods produced in the city for these barter deals.
The main reason farmers are not supplying the city is that they
can get higher prices in their local markets. Silaev's comments
were carried by TASS and Western agencies December 7. (John Tedstrom)


NORTH OSSETIA DEMANDS SANCTIONS AGAINST GEORGIA. The North Ossetian
parliament has sent a telegram to Yeltsin and RSFSR parliament
chairman Ruslan Khasbulatov calling for the imposition of sanctions
against Georgia in an attempt to constrain Georgia to halt its
military attacks on the disputed region of South Ossetia, TASS
reported on December 8. (Liz Fuller)



BALTIC STATES



ESTONIAN DIPLOMATIC NOTE TO MOSCOW. Estonia's Foreign Ministry
has denied allegations made last week by Soviet President Mikhail
Gorbachev that the Baltic states are violating the rights of
minorities living there, BNS reported on December6. Tallinn sent
an official note to the USSR Ministry of External Affairs protesting
the allegations and asking for evidence of such violations. Last
week Gorbachev told reporters that Russians, Ukrainians, and
"other minorities" living in the Baltic states have appealed
to the USSR for "defense." (Riina Kionka)

CONSTITUENT ASSEMBLY OPTS FOR PREWAR BORDERS. Estonia's Constituent
Assembly (CA) has voted to regard the borders established by
the 1920 Tartu Peace Treaty as the current borders of the Republic
of Estonia, according to BNS on December6. The Tartu borders
include two areas in northeastern and southeastern Estonia that
were annexed after World WarII by the RSFSR. The fate of the
two areas is supposed to be governed by a separate RSFSR-Estonian
agreement, but negotiations have not yet begun. The CA's decision
is not final. Before it takes effect, the CA as a whole must
vote on the entire draft constitution, which will then go before
the population for approval in a referendum. (Riina Kionka)

PRICES TO BE DECONTROLLED IN LATVIA. Radio Riga reported on December 6
that prices in Latvia are expected to be decontrolled this week,
perhaps as early as December10. Minister of State Janis Dinevics
stated that Prime Minister Ivars Godmanis, who is visiting the
Transcaucasian states, will address the people of Latvia before
this move, intended as a step toward establishing a market economy,
is taken. (Dzintra Bungs)

KGB STAFF DECLINES IN LATVIA. Edmunds Johansons, former chairman
of the KGB in Latvia, told Diena of December 6 that 1,400 persons
used to be on the KGB payroll (of these about were 350agents),
but that now the number has declined to about 200. Diena learned
from a former KGB employee that the organization's budget in
Latvia was 11million rubles (of which 5million were allocated
for "operative" work); he said that a large number of former
KGB employees are now working as consultants for various firms
and cooperatives. (Dzintra Bungs)

OGONEK FINANCES LAWYER FOR OMON LEADER. Diena reported on December 5
that Tatyana Kuznetsova, who served as Aleksandr Solzhenitsyn's
lawyer in the early 1970s, has been engaged to defend Sergei
Parfenov. Kuznetsova's fees are to be paid by Ogonek, the Moscow
weekly. The Latvian authorities are preparing a court case against
Parfenov, a former leader of the OMON detachment that was based
near Riga until its transfer to the Tyumen region at the end
of August. Many OMON members engaged in violent actions against
the people of Latvia and were active supporters of the coup in
Moscow. (Dzintra Bungs)

KAUNAS SAJUDIS CONFERENCE. On December 6 the Kaunas chapter of
Sajudis held a conference at which 64 delegates to the Third Sajudis
Conference on December 14-15 were elected, an RFE/RL correspondent
reported on December 8. Executive Secretary Alfonsas Vaisnora's
call for a campaign to gather 300,000 signatures for a referendum
on the office of president was greeted warmly, and parliamentarian
Rolandas Paulauskas, who opposed it, was booed from the speaker's
platform. The conference also issued a statement supporting the
government's position on the press. It called the newspaper strike
"a political blackmail action the purpose of which is to destabilize
the internal situation and discredit the Lithuanian leadership
among foreign countries." (Saulius Girnius)

LANDSBERGIS IN STRASBOURG. On December 7 Chairman of the Lithuanian
Supreme Council Vytautas Landsbergis traveled from Paris, where
he signed the Paris Charter, to Strasbourg at the invitation
of Pan Europa President Otto von Habsburg. On December 8 he spoke
at the Pan Europa Conference and met with Strasbourg's mayor
to discuss possible cooperation. Later that day he returned to
Vilnius via Warsaw, Radio Lithuania reported December 9. (Saulius
Girnius)