No. 106, 04 June 1992

SUCCESSOR STATES TO THE USSR

RUSSIAN SECURITY COUNCIL MEETS. Russian President Boris Yeltsin
chaired a meeting of the newly created Security Council on 3
June, ITAR-TASS reported. Members of the Council discussed the
problems facing Russian minorities in the CIS states. The debate
focused on the situation in Northern Ossetia and Moldova. Yeltsin
stressed the need to establish a "temporary moratorium on any
kind of border changes," indicating that at a later stage border
issues could be reviewed. The Security Council called for the
protection of Russian interests in the Trans-Dniester and the
North Caucasus. (Alexander Rahr)

GRACHEV AGAIN WARNS MOLDOVA. On 3 June, Russian Defense Minister,
Gen. Pavel Grachev, threat-ened Moldova's "politicians" that
"should they initiate military action against the Dniester region
and the [Russian] 14th Army units, he would find it difficult
to restrain the military units subordinated to him." According
to ITAR-TASS, Grachev told "the Russian population living in
Moldova to be reas-sured: we shall not leave it in the lurch."
This was the latest in a series of warnings to Moldova by Rus-sian
and CIS generals in recent days. (Vladimir Socor)

YELTSIN TO TAKE PART IN BLACK SEA SUMMIT. Before traveling to
the G-7 meeting in Munich on 8 July, Russian President Boris
Yeltsin is scheduled to participate in the summit of government
leaders of Black Sea neighboring states in Istanbul on 25 June,
ITAR-TASS reported on 2 June. The Black Sea summit will focus
on prospects for economic cooperation between Turkey and the
western and Transcaucasian CIS states. (Alexander Rahr)

MONEY SUPPLY TAKES OFF. Addressing reporters after a meeting
on 3 June of the "Trilateral Commission" representing government,
industry and trade unions, Russian First Deputy Prime Minister
Egor Gaidar announced plans for even higher monetary emissions
to counter the cash shortage, Interfax, ITAR-TASS, and "Vesti"
reported. 64 billion rubles' worth of new notes were printed
in May, 142 billion will be printed in June, and 250 billion
rubles' worth will be issued in August. (Apparently, no figures
were given for July). Gaidar hoped that 5,000 ruble notes would
be in circulation by July, instead of August as planned. (Keith
Bush)

GOLD COINS IN PAY PACKETS. Gaidar said that the government was
ready to use its gold reserves and to mint gold coins in order
to help pay overdue wages. (It will be interesting to see what
face value the gold coins will bear, how long they will remain
in circulation, and how long the gold reserves last). Overdue
salaries will be indexed at the current inflation rate; last
week, Gaidar had promised that they would be indexed at an annual
rate of 80%. Further credits will be extended, over and above
the 200 billion rubles already promised in April to defaulting
enterprises, and the 200 billion rubles pledged by Yeltsin to
the oil and gas industry last week. (Keith Bush)

TAX CUT FORTHCOMING? In reply to questions, Gaidar said that
the government had asked for parliamentary approval for its proposal
that the top rate of personal income tax be reduced from 60%
to 30%. The Western business community in Russia has been vociferously--and
predictably--disturbed that foreigners who reside there for more
than 183 days in a year are also subject to this 60% rate on
annual world-wide earnings exceeding 420,000 rubles--or about
$4,200 at the current exchange rate. (Keith Bush)

IMPACT OF FUEL PRICE RISES. Last week, Russian President Boris
Yeltsin announced that further increases in the wholesale prices
of energy-carriers will be postponed until a special commission
studied their anticipated impact on consumers. In the meantime,
several officials have aired their own forecasts. Economics Minister
Andrei Nechaev told the Trilateral Commission that retail prices
would rise by an average of 40%. An official of the chemical
and petrochemical machine-building industry told ITAR-TASS on
3 June that the wholesale prices of his branch's products could
double. (Keith Bush)

CORRUPTION IN THE SECURITY MINISTRY? Russian Security Minister
Viktor Barannikov has fired some high-level generals in his agency
for abuse of power, Interfax reported on 2 June. One of the sacked
generals is the former deputy head of the KGB's Second Main Administration
responsible for counterintelligence, Viktor Klishin. Apparently,
the dismissals may be followed by criminal proceedings. Barannikov
has ordered investigations by an internal anti-corruption commission.
ITAR-TASS called the dismissals part of an "unprecedented anti-corruption
campaign" within the former KGB. (Alexander Rahr)

COMMERCIAL ESPIONAGE SERVICE CREATED. Boris Yeltsin has reportedly
established a new commercial espionage agency attached to the
office of the president, Postfactum reported on 3 June. The agency
will not become part of the Security Ministry (the former KGB)
or the Interior Ministry and will be financed separately. According
to an unidentified official of the Security Ministry, this agency
will audit the financial solvency of Russian firms and monitor
foreign trade transactions. Itagency will operate within Russia
as well as abroad. (Alexander Rahr)

MORE ON KOKOSHIN'S VISIT TO TULA. On 2 June Andrei Kokoshin,
the first deputy defense minister, Viktor Glukhikh, the first
deputy minister of industry, and other Russian military officials
visited defense factories and met with workers in Tula to familiarize
themselves with ongoing conversion efforts. According to ITAR-TASS,
the military officials were questioned by workers on national
defense "in conditions of economic anarchy" and on the potential
loss of Russia's "unique scientific and technological potential."
Kokoshin emphasized contracts and economic agreements as the
most important instruments for directing defense orders in a
market economy. Within the next two months decisions will reportedly
be made as to which defense enterprises will be auctioned and
which will transfer production to civilian output.(Chris Hummel)


CONVERSION IN THE AEROSPACE INDUSTRY. Russian TV on 2 June examined
conversion in the aerospace industry and specifically at the
Tupolev firm. The report questioned the logic and profitability
of using the highly qualified workers within the defense industrial
complex, and particularly the aerospace industry, to produce
consumer goods, and suggested that conversion for a firm like
Tupolev should not involve fundamental changes in output. The
report also claimed that while 86% of Tupolev's production was
militarily-oriented in 1986, civilian space production already
accounts for 92% of the firm's activities in 1992. (Chris Hummel)


TUPOLEV MAKES DEAL WITH FOREIGN FIRMS. Russian TV went on to
say that Tupolev is developing a joint project with foreign firms
that would include a deal whereby Rolls-Royce would supply the
engines on one of the TU-204 series. Tests for this model are
conducted at a forest base in Zukovskii. The report also identified
the project as the first cooperative effort between Tupolev and
a foreign firm in such a highly classified field as airplane
construction. (Chris Hummel)

UNHAPPY OFFICERS IN BELARUS. The Belarus Academy of Sciences
Institute for Sociology has conducted a survey that indicates
a significant amount of dissatisfaction among officers in Belarus,
Radio Mayak reported on 3 June. According to Igor Kotlyarov,
a researcher at the institute, some 68.7% of respondents complained
about their living condi-tions and low pay, and only 8.2% felt
that life in the army had improved over the past year. Two-thirds
of officers polled reportedly said that they would not choose
a career as an officer if they had the choice to make again,
while five times as many officers supported maintenance of a
CIS armed forces over those who supported the creation of Belarusian
forces. Just over 16% reportedly said that they were willing
to engage in various acts of public protest to indicate their
dissatisfaction. (Stephen Foye)

UKRAINE DEFINES ROLE OF CONSTITUTIONAL COURT; ADOPTS NEW ECONOMIC
LEGISLATION. In an important move towards the establishment of
the rule of law in Ukraine, the Ukrainian parliament has passed
a new law on its second reading on the formation and powers of
Ukraine's constitutional court, Radio Ukraine reported on 3 June.
On the same day, the parliament also adopted another law paving
the way for Ukraine's integration into international economic
structures, such as the IMF and World Bank. (Bohdan Nahaylo)


KRAVCHUK SAVES FOKIN YET AGAIN. The Ukrainian parliament failed
on 3 June to vote on the question of confidence in Ukraine's
prime minister, Vitold Fokin, Radio Ukraine reported. His replacement
has been demanded by the democratic forces in the parliament
and demonstrators who are unhappy with the slow pace of reform
in Ukraine. According to Radio Ukraine, President Kravchuk once
again came to Fokin's rescue and appealed to the deputies not
to vote on the issue. He also rejected proposals from some democratic
deputies that he take over as prime minister. Pointing to the
example of Russia, he said that Boris Yeltsin's move to head
the Russian government "wasn't the best decision" he has ever
taken, Reuters reported. (Bohdan Nahaylo)

KRAVCHUK RECEIVES BIB DELEGATION. On 3 June, Ukrainian President
Kravchuk met in Kiev with a delegation of the US Board for International
Broadcasting. According to Radio Ukraine, Kravchuk told the visitors
that Ukraine wants the outside world to have as full and unbiased
a picture of developments in the republic as possible, and does
not want to be viewed through the prism of Russia and its media.
At home, Kravchuk, added, Ukraine wants to create conditions
for the media and flow of information befitting a "civilized,
democratic, and independent" state. That same day, the president
of the BIB, Malcolm Forbes Jr. opened an RFE/RL bureau in the
Ukrainian capital. (Bohdan Nahaylo)

UKRAINE'S GROWING CONTACTS WITH VISEGRAD TRIANGLE. Ukraine is
continuing to develop its contacts with members of the Visegrad
Triangle. On 2 June Ukraine and Hungary signed an agreement in
Budapest on cooperation between the police forces of both countries,
ITAR-TASS reported. The following day, as part of the bilateral
agreement for 1992 on military cooperation between Ukraine and
Czechoslovakia, a Czechoslovak military delegation arrived in
Kiev, Radio Ukraine reported. (Bohdan Nahaylo)

AZERBAIJAN ADOPTS LAW ON POLITICAL PARTIES. After a five month
debate, on 3 June the Azerbaijan National Council adopted a law
on political parties which guarantees the free activity of social-political
organizations and movements, ITAR-TASS reported. The president,
military personnel, religious figures, civil servants and journalists
are also barred from party membership. (Liz Fuller)

ACCUSATIONS AGAINST KARIMOV. In an interview published in the
28 May issue of Nezavisimaya gazeta, Uzbekistan's former vice-president,
Shukrulla Mirsaidov, described the reason for his recent resignation
as the increasing authoritarianism shown by President Islam Karimov.
Though the "never-ending search" for an economic model continues,
the country lacks a coherent economic plan, and the situation
is rapidly worsening. Since his resignation, Mirsaidov and family
members have been followed, their phones tapped, and repeated
efforts (including press reports which Mirsaidov is challenging)
have been made to charge them with corruption. Mirsaidov accused
the Uzbek president of directing this campaign. (Cassandra Cavanaugh)


UZBEKISTAN TO HAVE OWN CURRENCY. The chairman of the board of
Uzbekistan's State Bank, Faizulla Mullazhanov, said on 3 June
that Uzbekistan intends to introduce its own currency, Uza-TASS
reported. Officials in Uzbekistan have made similar announcements
in the past. Mullazhanov explained the need for an Uzbek cur-rency
by pointing out that the shortage of banknotes has affected thousands
of the country's inhabitants and is endangering the creation
of a market economy. Uzbekistan must import its banknotes from
Russia, but its requests for additional notes are not being met.
(Cassandra Cavanaugh)

"DNIESTER REPUBLIC" "RECOGNIZED" BY SERBIAN KRAJINA. The "Serbian
Republic of Krajina" has recognized the "independence and sovereignty
of the Dniester republic," TASS reported from Belgrade on 3 June.
The recognition was publicly announced by Krajina Serb representatives
at a rally in front of Russia's embassy in Belgrade. The message
of recognition said that the respective situations of Krajina
and the "Dniester republic" were similar and that Krajina will
soon send a mission to Tiraspol. (Vladimir Socor)

THE BREZHNEV ERA: A REAL DOWNER? According to the memoirs of
former Soviet Minister of Health Evgenii Chazov, cited by The
Observer of 31 May, Soviet leader Leonid Brezhnev abused tranquilizers
and sleeping pills provided by his personal nurse and Politburo
colleagues for the last ten years of his life. As Breznev's personal
physician at the time, Chazov accompanied the leader on his travels
well armed with stimulants which he administered prior to important
meetings. On one occasion, Brezhnev took a sleeping pill so strong
that Chazov's stimulants failed to get him up. Brezhnev's dependency
is said to have hastened his aging process and irreparably damaged
his central nervous system. (Sarah Helmstadter)



CENTRAL AND EASTERN EUROPE

UN REPORT SHEDS DIFFERENT LIGHT ON BOSNIA. The latest UN report
on the Bosnian crisis differs from previous assessments, which
placed much of the blame for the fighting in Bosnia on the Serb-dominated
federal army. Yugoslav area and Western media report on 3 and
4 June that the new report concludes Serbia has no direct control
over Bosnian Serb militiamen, and says that Croatian forces from
Croatia are staging offensives in Bosnia-Herzegovina as well.
The report states that Belgrade gave up its control last month
after the federal army discharged its Bosnian Serb troops--about
40,000 men--who took their weapons and equipment with them. Most
joined the army of the Serbian Republic of Bosnia-Herzegovina
commanded by Lt. Gen Ratko Mladic. Another 20,000 Serb soldiers
in Bosnia who are citizens of the Federal Republic of Yugoslavia
were returned home. The report also says Bosnian Serb forces
have launched attacks despite Belgrade's orders to honor cease-fires.
The UN report was made available to the Security Council an hour
after it voted to impose sanctions against Yugoslavia. Some Security
Council members would probably have delayed the vote had the
report been available sooner, but they rejected the notion that
Belgrade is entirely blameless. Some representatives are having
second thoughts and suggest that Croatia could also face sanctions,
Radio Serbia reports. (Milan Andrejevich)

MILOSEVIC WOULD RESIGN--IF . . . Serbian President Slobodan Milosevic
told British Channel 4 TV on 3 June that he would resign if that
would bring about peace in Bosnia. He said that it was not the
Serbian government but foreign diplomatic decisions that led
to the violent breakup of Yugoslavia. In an interview with the
Greek TV station MEGA he welcomed the latest UN report, describing
it as the "first big step towards the truth," adding that he
had not expected "such good news." He also accused Western media
of incorrect and biased reporting of the Bosnian situation. Radio
Serbia carried the report. (Milan Andrejevich)

BOSNIA UPDATE. Bosnia's medical crisis center estimates that
5,700 people have been killed and 20,000 wounded since fighting
began 29 February, Radio Serbia reported on 3 June. Bosnia's
Presidency has again requested foreign military intervention
amid intense fighting. Croatia's government has also called on
the UN to step up its efforts to halt the fighting and, at a
CSCE meeting, urged immediate intervention by NATO. (Milan Andrejevich)


MACEDONIAN LEADERS IN ALBANIA. Officials from the former Yugoslav
Republic of Macedonia met with top Albanian leaders in Tirana
on 3 June, ATA reports. Macedonian President Kiro Gligorov and
Albanian President Sali Berisha pledged to establish a "model
relationship" for other Balkan states to follow. Berisha said
that Albania may soon recognize Macedonia's independence. Both
men promised to improve bilateral relations quickly "in all fields
of mutual interest." Relations have been strained by Albanian
charges that Macedonia is discriminating against its large ethnic
Albanian minority. (Milan Andrejevich)

ROMANIA, NATO, AND YUGOSLAVIA. A spokesman said on 3 June that
Foreign Minister Adrian Nastase will head a delegation to the
NATO meeting in Oslo on 5 June. Because of conflicts on Romania's
borders and of related "aggressive nationalism fanning ethnic
fighting," the statement also said that Romanian security should
be guaranteed by strengthening ties with NATO and with the Western
European Union. Romania will comply with the UN sanctions against
Yugoslavia, however, it reserves the right to demand compensation
for the resulting losses, otherwise it would itself become the
victim of the sanctions. The spokesman mentioned that Romania
received no compensation for losses incurred from its compliance
with the UN sanctions against Iraq. (Mihai Sturdza)

CZECHOSLOVAK CAMPAIGN: THE SOUND OF TEARING VELVET? Candidates
in the general elections concluded their campaigns with final
appeals to voters on 3 June, Western agencies report. Vladimir
Meciar, head of the Movement for a Democratic Slovakia, confirmed
that his group plans to declare the region's sovereignty: "No
one could stop us from adopting our own constitution and electing
a Slovak president." He criticized federal President Vaclav Havel's
televised address of 2 June as more emotional than rational.
Federal Finance Minister Vaclav Klaus, head of the Civic Democratic
Party, said Meciar's demands for looser ties with the Czech lands
are unacceptable. He says he sees the breakup of the country
as no real danger; if it does happen it will be done in a "velvet"
manner. (Barbara Kroulik)

WALESA OFFERS PREMIERSHIP TO RURAL LEADER. On 3 June President
Lech Walesa proposed Waldemar Pawlak, chairman of the Polish
Peasant Party (PSL), for the post of prime minister, PAP and
Reuters report. If Olszewski's government falls, the leader of
Poland's biggest farm party would become a head of a cabinet
formed from two coalitions. The PSL's spokesman said Pawlak hoped
to combine his own newly created three-party alliance that includes
also the Christian National Union and the Peasant Accord with
the proreform "small coalition" of the Democratic Union, the
Liberal-Democratic Congress, and the Polish Economic Program.
Such a coalition could command a majority in the Sejm, which
Olszewski's government has failed to achieve. The confidence
vote is scheduled for 5 June. Asked by reporters to comment on
his chances of forming a new coalition, Pawlak, with characteristic
shrewdness and caution replied: "Let me comment on that in due
time." (Wladyslaw Minkiewicz)

HUNGARIAN COALITION ON DISPUTE OVER PRESIDENTIAL JURISDICTION.
Imre Konya, the parliamentary leader of the Democratic Forum,
told an international press conference on 3 June that "there
is no political or constitutional crisis" in Hungary because
of the dispute over the sphere of authority of the president.
Konya stressed that the dispute is not a political matter but
rather a constitutional problem that arose because the prime
minister and the president interpreted the president's jurisdiction
differently. The coalition parties have recently criticized President
Arpad Goncz because he refused to approve Prime Minister Jozsef
Antall's motion to dismiss the president of Hungarian radio.
Konya reiterated that the government does not seek Goncz's resignation.
This was reported by MTI. (Edith Oltay)

ESTONIAN MINISTER WINS VOTE. Estonia's Interior Minister Robert
Narska survived a vote of no-confidence in the Supreme Council
on 3 June, the next day's Rahva Haal reports. In what was described
as a stormy session, Prime Minister Tiit Vahi defended his appointee
against the Peoples' Center faction, led by former Prime Minister
Edgar Savisaar, which brought the motion against Narska last
week. When the votes were tallied, 42 were for taking Narska
down, 30 against, and 2 abstained. (Riina Kionka)

UDF ON SECRET POLICE FILES. In connection with a draft law on
secret police files to be introduced to the Bulgarian National
Assembly, the UDF Coordination Council on 2 June adopted a declaration
calling on UDF deputies help disclose files on key personalities
in public life. The chairman of the UDF parliamentary group Aleksandar
Yordanov, interviewed by Demokratsiya daily, said the names of
"both victims and hangmen" must be made public. Some UDF parliamentarians,
who argue that there is no way of knowing whether the original
files have been replaced or "edited," oppose the draft. (Kjell
Engelbrekt)

BELGIUM HALVES POLAND'S DEBT. On 3 June Poland and Belgium signed
an agreement reducing Warsaw's foreign debt with Brussels by
half. Under the accord, repayment of the remaining $305 million
is to be accomplished in stages over a period of 17 years, Western
and Polish media report. Finance Ministry spokesmen said Belgium
is the fourteenth country to sign a debt reduction accord with
Poland and agreements are to be signed yet with Spain, Switzerland,
and Italy. (Wladyslaw Minkiewicz)

ROMANIA'S FINANCIAL NEEDS AND CREDITS. Officials from the Environment
Ministry said that Romania will need up to $250 million to clean
up pollution and solve other environmental problems. The World
Bank and foreign experts are drawing up a plan to that end to
be ready by September. Refineries, as well as power and metal
plants, head the list of the some 20 sites classified as critical.
Romania will get a $400 million loan from the Washington-based
International Bank for Reconstruction and Development, and an
additional cofinancing credit of more than $100 million from
Japan, local and Western media said on 3 June. (Mihai Sturdza)


DUBYNIN: MOST RUSSIAN SOLDIERS OUT OF POLAND. On 3 June Gen.
Viktor Dubynin said that of the 59,000 former Soviet troops previously
stationed in Poland, 35,000 have now been withdrawn. During a
meting in Warsaw with President Walesa, Dubynin also said that
with the exception of 6,000 communications specialists, the remaining
units will be pulled out by 15 November of this year. He assured
the Polish president that facilities vacated by Russian troops
will handed over to Polish authorities "in good order." He apparently
also "apologized" for the "47-year presence" of ex-Soviet soldiers
on Polish soil, which has occasioned "much ill will," AFP reports.
(Wladyslaw Minkiewicz)

ESTONIA BREAKS OFF TALKS WITH RUSSIA. On 3 June Estonia temporarily
suspended consultations intended to lead to general disengagement
negotiations with Russia. The action was taken when it became
apparent the sides could not even agree on a point of departure
for real negotiations. Negotiator Juri Kahn told Paevaleht on
4 June that the Russian military negotiators "presented their
positions in a form so categorical that no room remains for a
compromise solution." This round is the third between Russia
and Estonia this year. (Riina Kionka)

GRACHEV PROTESTS TREATMENT OF FORCES. On 3 June Radio Lithuania
reported that Russian Defense Minister Pavel Grachev sent a telegram
to Lithuanian parliament chairman Vytautas Landsbergis complaining
about attempts to create unbearable working conditions for his
soldiers serving in Lithuania. He threatened to ask the Russian
government to halt the withdrawal of the troops. Landsbergis
responded in a telegram that only by stretching the point could
one say that the withdrawal had begun. Noting that Russia has
more than once recognized that Lithuania has complete sovereignty,
he repeated that Russian soldiers violating Lithuanian laws would
be prosecuted. After a telephone call with Russian President
Boris Yeltsin, it was decided that the two would meet informally
in Moscow on 5 June (Saulius Girnius)

BALTIC DEFENSE LEADERS TO COOPERATE. On 2 June Baltic defense
leaders signed an accord to develop a common defense system and
cooperate in military matters, BNS reports. At the meeting in
Paernu, Estonia, the officials also discussed ways to facilitate
the exchange of information on operations, designation of military
attaches, coordination of plans to deal with crisis situations,
cooperation on military-technical issues, and the development
of common training bases. (Dzintra Bungs)

PUBLIC SAFETY ENDANGERED BY STORED AMMUNITION. Radio Riga interviewed
local officials from Garkalne County on 27 May concerning mines
and other ammunition stored on its territory since World War
II. They were concerned about public safety at this, the largest
such storage area in the Baltic States containing enough ammunition
to fill at least 2,000 railroad cars. Moreover the area is no
longer properly patrolled. Given that Garkalne is about 30 kilometers
east of Riga, the residents fear that should an explosion occur,
the damage would be enormous. They want the issue to be brought
up in the Latvian-Russian talks of the withdrawal of ex-USSR
troops from Latvia. (Dzintra Bungs)

MILOSZ VISITING LITHUANIA. Literature Nobel Prize laureate Czeslaw
Milosz has returned to Lithuania after a 52-year absence, Radio
Lithuania reports. He arrived in Vilnius on 26 May and held a
meeting with Landsbergis the following day. He took part in the
28th Spring of Poetry festivities and received an honorary doctorate
from Vytautas Magnus University. He spent 30 and 31 May visiting
the village of Sateiniai, where he was born, and other areas
of the Kedainiai Region, and participated in numerous literary
readings throughout the republic. On 3 June the presidium of
the Supreme Council made Milosz an honorary citizen of Lithuania.
(Saulius Girnius)

INTERNATIONAL SEMINAR IN VILNIUS. On 3 June Landsbergis opened
the first session of a four-day international seminar "Parliament
and Government: Relations in the Process of Passing Laws," Radio
Lithuania reports. Parliamentarians and experts from East and
West European countries and the USA have gathered in the seminar,
organized by the East-West Parliamentary Practice Project. The
main speech from Lithuania was given by parliament deputy chairman
Bronius Kuzmickas. (Saulius Girnius) [As of 1200 CET] Compiled
by Carla Thorson & Charles Trumbull







(END)

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