No. 56, 20 March 1992

SUCCESSOR STATES TO THE USSR

CIS SUMMIT OPENS IN KIEV. Opening the meeting of CIS Heads of
State in Kiev on 20 March, Ukrainian president Leonid Kravchuk
said the summit was taking place at an extremely difficult time
when confrontation was turning to war in some regions and the
economy was threatened with disintegration, UkrINFORM-TASS reported.
Kravchuk noted that the situation had deteriorated since the
CIS was set up. Uzbek president Islam Karimov, elected chairman
at Kravchuk's suggestion, said opinions differed so widely on
the package of military, economic, and political questions to
be decided that he doubted they could all be dealt with in one
day. Outside a meeting was going on of those Ukrainian movements
(including Rukh and the Ukrainian Republican Party) that oppose
Ukrainian membership of CIS. (Ann Sheehy)

MORE ON NUCLEAR WEAPONS IN UKRAINE. Russian reports that Kravchuk
had agreed, in a telephone conversation with Russian President
Boris Yeltsin, to honor the 1 July withdrawal deadline for tactical
nuclear weapons have been denied by Kravchuk's press officer.
(The reports were widely interpreted to mean Kravchuk had agreed
to resume the transfers immediately.) As quoted by Reuters on
20 March, Vladimir Shlyaposhnikov denied the two presidents had
even talked over the telephone. Viktor Antonov, the Ukrainian
defense industry minister, told a Kiev news conference on 19
March he would like to see Ukraine receive some of the nuclear
material from the dismantled weapons for use in its nuclear power
stations, but admitted that this had not been an agreed part
of the dismantling scheme. He said Ukraine had no facilities
to dismantle weapons. (Doug Clarke)

DEFENSE MINISTERS MEET PRIOR TO CIS SUMMIT. Reuter on 19 March
reported that the CIS Defense Ministers were meeting that day
near Kiev to seek compromises in the several divisive military
issues that their heads of state were to take up on 20 March.
While there were no reports on the results of the ministers'
meeting, Ukrainian officials said the draft summit agenda consisted
of 34 items, making it virtually impossible for all of the issues
to be considered. (Doug Clarke)

UKRAINE SAYS RUSSIA REFUSING TO SHARE ASSETS. On the eve of the
Kiev summit, Ukraine's deputy minister for foreign affairs, Borys
Tarasiuk, complained that Russia was refusing to divide up the
foreign assets and property of the former USSR as agreed by CIS
members (Radio Kiev, 19 March). Tarasiuk accused Russia of acting
as if it were the sole legal successor to the USSR and said negotiations
on sharing Soviet foreign assets had failed to produce results.
(Bohdan Nahaylo)

IRANIAN-BROKERED CEASE-FIRE IN NAGORNO- KARABAKH. A one-week
truce in Nagorno-Karabakh goes into force at midday local time
on 20 March, Iranian deputy foreign minister Mahmoud Vaaezi told
Western reporters in Erevan on 19 March. The cease-fire is part
of the Iranian peace proposals agreed in Tehran on 15 March and
ratified by acting Azerbaijani President Yakub Mamedov and Armenian
President Levon Ter-Petrossyan on 18 March; it will be monitored
by Iranian observers. UN special envoy Cyrus Vance met with Ter-Petrossyan
in Erevan on 19 March, and will travel to Nagorno-Karabakh on
20 March. (Liz Fuller)

ARMENIA DENIES INTRODUCING STATE OF EMERGENCY. The Armenian government
rejected as "disinformation" a report broadcast on 18 March that
it had introduced a state of emergency, but a foreign ministry
spokesman conceded that such a step could be taken within the
next few days in response to the Azerbaijani economic blockade,
Western agencies reported on 19 March. (Liz Fuller)

YELTSIN APPEALS TO TATARSTAN PARLIAMENT. In an appeal read out
in the Russian parliament and broadcast by the Russian media
on 19 March, Yeltsin said it was not too late for the Tatarstan
parliament to comply with the Russian Constitutional Court's
ruling on the 21 March referendum on Tatarstan's state status.
Yeltsin said that he feared that nationalist forces could use
the referendum--whatever its outcome--to kindle interethnic hostility
both within and outside Tatarstan. The Russian parliament called
on Yeltsin to enforce the Constitutional Court's ruling and said
the results of the referendum would have no legal force. Tatarstan
leaders said the referendum would go ahead as planned. (Ann Sheehy)


DUBININ APPOINTED RUSSIA'S NEGOTIATOR WITH UKRAINE. Russian president
Boris Yeltsin has appointed former Soviet ambassador to Washington
Yurii Dubinin Russia's chief negotiator with Ukraine on political,
economic, and military issues, Reuters reported on 18 March.
(Bohdan Nahaylo)

UKRAINIAN DECREE ON FOREIGN TRADE AND FOREIGN CURRENCY. Ukrainian
President Leonid Kravchuk signed a decree on 19 March liberalizing
foreign trade and foreign currency regulations, Reuter reported
on 20 March citing Kiev Television. The decree was said to stimulate
imports and exports and to allow licensed traders to buy and
sell freely on foreign markets. Foreign currency trading would
also be permitted and retail stores allowed to keep accounts
in foreign currency. (Keith Bush)

RUSSIAN PRIVATIZATION PROGRAM. Professor Jeffrey Sachs, one of
Yeltsin's Western advisers, told The Financial Times of 19 March
that the Russian government is finalizing a mass privatization
program which could place half of the shares of Russian industry
in private hands within a year. Foreign investors would play
a key role in the sale of "dozens" of the largest enterprises
in the oil, gas, telecommunications, and automobile sectors.
Shares in thousands of enterprises would be offered to workers,
management, and the public through a system of individual vouchers
and investment trusts like those being used in Czechoslovakia,
Hungary, and Poland. (Keith Bush)

RUSSIAN BUDGET DEFICIT. Recent pronouncements by Russian government
officials suggest the budget deficit is running at a far higher
rate than the "Economic Policy Memorandum" of 27 February envisaged
or than the IMF recommended. Egor Gaidar is quoted (Washington
Post, 20 March) as insisting that the deficit for the first quarter
will not exceed 4-5% of the GNP, while other officials predict
the quarterly deficit will reach 8-10%. Some 22 billion rubles
extra has been set aside to meet the increased wages of the coalminers.
Aleksei Ulyukaev told a news conference on 19 March that VAT
collections had fallen short by 30 billion rubles, while income
tax revenues were 5 billion rubles higher than planned, during
the first two months of 1992. (Keith Bush)

RUSSIAN AGRICULTURAL REFORM PLANS. The Russian Cabinet of Ministers
on 19 March discussed the progress of agricultural reform, Moscow
TV-1 reported. At his news conference that day, Ulyukaev provided
some specifics. The reform program for 1992-95 commences with
the reorganization of loss- making farms and the stimulation
of private farming. Of the 1,156 kolkhozes reorganized to date,
only 32% have chosen to be broken- up into smaller farms, some
36% have become joint stock companies, 6% have become cooperatives,
and the rest retain their previous status. By 1995, Russia intends
to legalize the private buying and selling of farm land and to
allow foreign investment in agriculture. (Keith Bush)

SHAPOSHNIKOV ON CONSTRUCTION TROOPS. Air Marshal Evgenii Shaposhnikov,
the CIS commander in chief, says the presence of construction
battalions in the army is a vestige of the past, adding: "We'll
leave them behind at the end of the day." Interviewed on the
"Vesti" news program on 19 March, Shaposhnikov said that if these
units remained at all it would be for those wishing an alternative
to military service. Young men not wishing to serve the compulsory
18 months in the military might opt for 24 months in a construction
battalion. (Doug Clarke)

RUSSIAN DEPUTIES KEEN TO IMPEACH BURBULIS. Russian television
on 19 March broadcast the whole of that day's session of the
Supreme Soviet. All parties in the legislature proved dissatisfied
with the Yeltsin government and in particular with first deputy
premier Gennadii Burbulis, accused by one deputy of abuse of
power and trying to set up a personal dictatorship: the deputy
called for Burbulis' impeachment. A majority of deputies seemed
to favor stripping Yeltsin of the extraordinary powers he was
granted last year to appoint government ministers without consulting
parliament; they also wanted Russia's new constitution to ban
the president from creating extraconstitutional bodies such as
the "state advisers" (who monitor the performance of government
ministers and are headed by Burbulis). (Julia Wishnevsky)

NEW RULES FOR LOCAL OIL EXPORTS. According to Kommersant of 16
March, a government order of 9 March clarifies the rules for
oil and gas exports by regional governments in the Russian Federation.
Under a Yeltsin decree, regional authorities may buy up to 10%
of the oil, oil products, or gas produced in their territories
at the state price, and re-sell part of it (6 of the 10%) abroad
for hard currency. It is now clear that this will be arranged
through an allocation of 10% of the Russian Federation's export
quota to regional authorities, on a competitive basis. Sales
made under the quota are exempt from export duty and from the
requirement to sell some of the proceeds for rubles. (Philip
Hanson)

REBUILDING GOLD AND DIAMONDS MONOPOLY? Russian Federation Deputy
Finance Minister Golovatyi has reportedly recommended to Deputy
Prime Minister Egor Gaidar that all commodity-exchange sales
of precious metals and stones should go through only one exchange,
a specialist international exchange to be set up by the Ministry
of Finance and the Almazzoloto corporation. According to Kommersant
of 16 March, Golovatyi's 11 March memo proposes that no other
exchanges be allowed to handle these items. Almazzoloto, formed
last October, is the heir on Russian territory of the old state
monopoly, Glavalmazzoloto (Izvestiya 3 October 1991). (Philip
Hanson)

MOSCOW LEADERS ARM THEMSELVES. Some two dozen "Margolin" pistols
have been distributed to the members of the Moscow city government
to ensure their personal security, the chief of Moscow's uniformed
police informed Moscow News (no. 11, 1992). Arkadii Murashov
said the arms were provided at the request of Moscow's deputy
mayor, Yurii Luzhkov. However, neither Luzhkov nor his boss,
Moscow mayor Gavriil Popov, took a weapon: both enjoy the protection
of bodyguards from Boris Yeltsin's presidential security service.
(Victor Yasmann)

KGB ADMITS AIDS SCARE STORY. During a recruiting lecture for
the Russian Foreign Intelligence Service, Evgenii Primakov admitted
that the KGB planted fake news stories blaming the spread of
AIDS on a US military experiment. His statement was quoted in
Izvestiya, as reported by Reuter on 18 March. Primakov said that
the story, which was widely propagated in the Third World, was
designed to expose the "perfidious" work of US military scientists.
According to Primakov, US intelligence agencies retaliated by
leaking so-called "evidence" of KGB complicity in the assassination
attempt against Pope John Paul II. (Keith Bush)

MOLDOVA PROTESTS RUSSIAN SUPPORT FOR "DNIESTER" BANK. On March
18, Chisinau sent a protest note to Russia in connection with
the Russian State Bank's decision to open accounts for the self-styled
"state bank of the Dniester republic." The Russian State Bank's
decision violated the laws and practices on interstate banking
relations within CIS as well as Russian-Moldovan financial agreements,
the note said as cited by Moldovapres. (Vladimir Socor)

SPILLOVER INTO UKRAINE. According to Ukrinform and Radio Rossii
of 18 March the number of refugees fleeing into the Odessa region
of Ukraine from the armed conflict in Moldova has reached over
3,000. (Bohdan Nahaylo)

OFFICIALS IN KAZAKHSTAN MUST DECLARE THEIR INCOME. As part of
a series of measures to combat corruption and organized crime
in Kazakhstan, Kazakh president Nursultan Nazarbaev has issued
a decree requiring that public officials declare their annual
income and prove how they earned it, KazTAG-TASS reported on
18 March. The decree also forbids public officials to accept
gifts from organizations, enterprises, foreign governments, or
private individuals in connection with their official duties.
This part of the decree may prove difficult to enforce in a culture
where the giving and receiving of gifts is so deeply ingrained.
(Bess Brown)

TURKISH TV IN CENTRAL ASIA. Uzbek TV has been experimentally
broadcasting a Turkish TV program that eventually will be made
available to all Central Asian states, Uza-TASS reported 19 March.
In January, Turkish officials promised to set up a satellite
system for broadcasting Turkish TV to Central Asia. That project
is apparently still in the works, but the experiments in Uzbekistan
are using parabolic antennas belonging to Uzbekistan's weather
service. (Bess Brown)

UN WARNS OF HEALTH SERVICE CRISIS IN CIS. A joint report by the
World Health Organization and the UN Children's Fund, published
on 18 March, said that the former Soviet republics urgently need
help from the international community to avoid a health-care
crisis. According to Reuter, the report is based on surveys conducted
by 5 UN missions in February in the 11 CIS republics and the
3 Baltic states. In the five Central Asian republics, the report
found, the crisis was "rapidly evolving and entirely unpredictable
in its future trajectory and velocity." The report, to be sent
to the governments that attended the January 1992 aid conference,
calls for urgent aid to the value of $420 million. (Keith Bush)




BALTIC STATES



TROOP WITHDRAWAL TALKS GO FORWARD. The head of the Lithuanian
delegation on talks with Russia on the withdrawal of former Soviet
army troops from Lithuania, Minister without Portfolio Aleksandras
Abisala, said that some progress was made in discussions in Moscow
on 18-19 March, Radio Lithuania reports. Drawing up of a timetable
has been hindered by the refusal of the army to give any specific
information about its forces in the republic. Difficulties are
also emerging in determining the size of the compensation Lithuania
should receive for ecological and other damage the army caused
during its stay. Sergei Zotov, head of Russia's delegation of
experts discussing the withdrawal of ex- Soviet troops from Latvia
told the press on 19 March before returning to Moscow that the
talks in Ligatne were constructive, and that many issues were
discussed, including the defense industry in Latvia. Nonetheless,
further talks will take place in order to draft a formal accord.
Large-scale troop withdrawals can be expected later this year,
Zotov said, adding that Yeltsin has appointed an envoy to Latvia
whom he did not identify, Radio Riga reports. (Saulius Girnius
& Dzintra Bungs)

LATVIAN MINISTER ON TROOP PULLOUT. Defense Minister Talavs Jundzis
called the withdrawal of 49 soldiers from Latvia on 19 March
"a theatrical performance"; he noted that "if it keeps on like
this, we won't be alive long enough to see the last one go,"
Radio Riga reported that day. At the ceremonial sendoff in Bolderaja
there were almost as many reporters as soldiers leaving Latvia.
Col. Gen. Valerii Mironov said that this is the beginning of
the withdrawal process, which will continue after Latvia and
Russia work out a formal accord on the pullout. Latvian officials
boycotted the ceremony at Bolderaja as they had done on 12 March
at Salacgriva, when an even a smaller number of soldiers departed.
Mironov said that there were about 45,000 troops in Latvia, but
Latvian officials consider the figure to be too low. (Dzintra
Bungs)

FINNISH PRESIDENT PLEDGES SUPPORT TO ESTONIA. During a luncheon
speech in Tallinn on 19 March, Finland's President Mauno Koivisto
said that his country "is ready to give continued support to
the struggles of the Estonian people." He added that the economy
must be reformed in order to close the gap in living standards
between Estonia and Western Europe. During his visit to Estonia,
Koivisto met with Prime Minister Tiit Vahi and other Estonian
leaders, Reuters reports. (Dzintra Bungs)

MORE POWERS FOR LANDSBERGIS? The National Progress faction in
parliament is planning to propose legislation granting greater
powers to Lithuanian Supreme Council Chairman Vytautas Landsbergis
and Prime Minister Gediminas Vagnorius, the RFE/RL Lithuanian
Service reported on 19 March. The proposals would give the Supreme
Council chairman the power to appoint all cabinet members, except
for the ministers of national defense and internal affairs, on
the recommendation of the prime minister but without requiring
the consent of parliament. He could also return laws passed by
parliament for modification. The prime minister would be allowed
to appoint and dismiss the mayors of cities with the approval
of the Supreme Council chairman. If these changes are accepted,
the planned 23 May referendum on creating a presidency may well
become unnecessary. (Saulius Girnius)

CENTRAL AND EASTERN EUROPE

UPDATE ON THE YUGOSLAV AREA. The 20 March Frankfurter Allgemeine
Zeitung reports continued cease-fire violations by the federal
army in Croatia over the previous 24 hours. Some 250 mortar rounds
fell around Osijek and another 150 around Nova Gradiska. Other
fighting was reported in Dalmatia from Zadar to Dubrovnik. Reuters
quotes Serbian officials in the Baranja region they occupy as
saying that Croatian forces had shelled the area. On 19 March
Austrian TV said that 50 Norwegian logistics specialists have
arrived in Croatia as part of the advance group of 400 UN peace-keeping
officers. The 19 March issue of Vjesnik reported that the EC-sponsored
plan for Bosnia and Herzegovina allots 52 of the republic's districts
to the Muslims, 37 to the Serbs, and 20 to the Croats. The paper
added that in terms of total territory this means that the Muslims
and Serbs would each get about 44%--i.e., the Serbs would have
more and the Croats less of a share of the land than their respective
33% and 18% of the republic's total population would seem to
entitle them. Finally, the daily notes that 50 countries have
now recognized Croatia, with Libya and Japan being the most recent.
(Patrick Moore)

UNPROFOR COMMANDER CRITICIZED IN CROATIA. Borba reports on 19
March that several opposition leaders and the media in Croatia
have criticized Gen. Satish Namibar, the UNPROFOR commander.
The Belgrade daily cited an article from Vjesnik (Zagreb) in
which Gen. Namibar's logistics were called "neither flawless
nor unbiased." Vjesnik was critical of Namibar for visiting Belgrade
before Zagreb, and for having flown with Yugoslav Airlines from
New York to Belgrade accompanied by "warmonger" Borisav Jovic,
a Serb and member of the rump Yugoslav State Presidency. Borba
suggests that Croatia is generally not satisfied with the UN
plan for the deployment of peacekeeping forces in Croatia and
hopes for their early withdrawal. Mika Tripalo, a prominent opposition
leader, is quoted as saying that Croatia will lose all sovereignty
in the protected areas under the UN plan. Drazen Budisa, head
of the Croatian Social Liberal Party, stated that because the
UN troops are stationed exclusively in Serb areas they will actually
be "protecting the Serbs from Croats who have never threatened
them." (Milan Andrejevich)

OLSZEWSKI IN FRANCE. Polish Prime Minister Jan Olszewski expressed
satisfaction with his official trip to France, saying that all
goals of the visit were fulfilled. On 20 March he told reporters
that Poland enjoys "great sympathy" in France. Olszewski also
announced that a commission will be named to facilitate foreign
investment. President Fran�ois Mitterrand said he favors Poland's
entry into the EC in principle but stressed that Warsaw should
not harbor any illusions that EC membership would be the answer
to its economic problems. Prime Minister Edith Cresson expressed
the opinion that Europe cannot continue to be built without Poland,
Western and Polish media report. (Wladyslaw Minkiewicz)

WALESA: STOP FLOODING POLAND WITH IMPORTS. President Lech Walesa
has called on Western countries to stop flooding Poland with
their products and help build up the country's own industry instead.
He told Handelsblatt and the Wall Street Journal on 19 March
that Western imports have contributed to the decline of Polish
industry. Walesa also said that Poland wants to pay back its
debts but questioned whether it is best to do so now rather than
using the money for the future. (Wladyslaw Minkiewicz)

SLANDER CASE AGAINST GLEMP REJECTED. On 19 March US Federal Court
Judge Robert Patterson dismissed a slander suit filed by New
York rabbi Avi Weiss against the Polish Catholic Primate, Cardinal
Jozef Glemp. According to Western media, the suit was thrown
out on a legal technicality--that Glemp had not been served a
proper summons. The rabbi said he would appeal the ruling. Weiss
alleges Glemp defamed him during a mass in August 1989 in Czestochowa,
by falsely accusing him of planning to kill nuns living at a
Carmelite convent outside the Auschwitz concentration camp. (Wladyslaw
Minkiewicz)

POLAND AGREES TO EXTRADITE US TAX EVADER. On 19 March the provincial
court in Lublin agreed to extradite David Bogatin, chairman and
majority owner of the First Commercial Bank of Lublin, one of
Poland's new private banks. He is wanted in the US for tax evasion,
fraud, and forgery. Bogatin's attorneys have argued that tax
evasion is not covered by the Polish-US extradition treaty, but
the court ruled that Bogatin could be extradited on the forgery
charge, Western and Polish media report. The Russian-born Bogatin
has US citizenship. He fled the US in 1987, forfeiting $500,000
in bail. (Wladyslaw Minkiewicz)

JAKES SAYS COMMUNIST PARTY WANTED REFORMS. Former Czechoslovak
Communist Party General Secretary Milos Jakes told the Vienna
daily Der Standard of 19 March that although the party had made
errors, it wanted to institute reforms in 1990. The ouster of
the communists in 1989 interrupted the reform process. Jakes
said that Czechoslovakia was proceeding slowly to avoid the mistakes
of Poland's and Hungary's reforms. He also said that the CP leadership
had been forced into some of its errors by Soviet demands that
Czechoslovakia give priority to heavy industry and produce consumer
goods cheaply at the expense of quality. (Barbara Kroulik)

McDONALD'S IN PRAGUE. McDonald's opened its first fast- food
facility in Prague on 19 March. Housed in an art-nouveau building
off Wenceslas Square, it has been described as one of the classiest
establishments in the city. Manager Karel Suk said the meat comes
from southern Bohemia and the buns and fries are imported from
Moscow but he wants to use only local suppliers by the end of
1992. Prague residents were not impressed; the outlet replaces
a restaurant with lower prices, Western agencies report. (Barbara
Kroulik)

PRIVATIZATION IN HUNGARY. Hungary's State Property Agency (SPA),
in charge of privatizing state assets, has privatized 4,000 state-owned
companies thus far and wants to prepare another 2,000 for sale
by transforming them into shareholding ventures by year's end,
SPA head Lajos Csepi told Western newsmen on 19 March. Csepi
reported that Hungary's income from privatization of state firms
has reached $178 million by the end of February, a 38% increase
over the end-of-January figure. He predicts that the entire privatization
process can be completed in about four years.(Edith Oltay)

HUNGARY SIGNS ENVIRONMENTAL PROTECTION AGREEMENT. On 19 March
in Helsinki Hungary became one of the over 20 countries to sign
the UN European economic committee's environmental protection
convention. The signatories are obliged to inform each other
about companies using hazardous materials, pledge to investigate
the sources of water pollution, and work out plans for emergencies.
Great importance is attached to reducing water pollution in neighboring
countries since a substantial part of Hungary's rivers originate
outside the country. (Edith Oltay)

FUNDS FOR CULTURE IN ROMANIA LACKING. Romania's Culture Minister
Ludovic Spiess said on 19 March that his ministry's 1992 budget
is only 0.32% of the national budget. Three billion lei should
be added to the allotted 3.8 billion, he says, otherwise it will
be impossible to continue restoration of historic monuments,
complete the National Library and the National History Museum,
and fund significant cultural events and museums. (Mihai Sturdza)


ROMANIA ON MOLDOVA, TREASURY. On 19 March President Ion Iliescu
sent messages to the presidents of Russia and Ukraine urging
them to take joint action to find a negotiated settlement to
the conflict. Foreign Minister Adrian Nastase said that during
his recent talks in Moscow he noticed a shift in Russia's stand
about Romania's state treasury confiscated in 1917 by the Soviets.
For the first time the Russians have agreed to set up a joint
commission to look into the matter. (Mihai Sturdza)

BULGARIAN-TURKISH MILITARY AGREEMENT DELAYED. A Turkish military
delegation, headed by first deputy chief of general staff Fikret
Kupeli, ended a visit on 19 March without the planned signing
of an agreement on military cooperation. BTA said on 19 March
that the government approved the agreement on cooperation in
military training in principle but additional coordination will
be necessary and Bulgaria will be ready to sign by 27 March.
Separately the government approved a draft agreement abolishing
restrictions on the movement of diplomatic and consular personnel
on the respective territories, excluding certain zones. Also
on 19 March the government discussed border problems with Turkey,
especially in connection with the recent violations of Bulgarian
Black Sea waters by Turkish fishing boats. (Rada Nikolaev)

BULGARIAN-US LABOR AGREEMENT. On 18 March Minister of Labor Vekil
Vanov, who has been on a working visit to the US for more than
a week, and his US counterpart Lynn Martin signed a memorandum
on cooperation in helping Bulgaria design and implement worker
assistance programs. An RFE/RL correspondent and Bulgarian Radio
report from Washington that this is the fourth US labor assistance
program with former communist states, after those signed with
Poland, Hungary, and Czechoslovakia. (Rada Nikolaev) [As of 1200
CET] Compiled by: Elizabeth Teague & Charles Trumbull



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