No. 125, 03 July 1992

SUCCESSOR STATES TO THE USSR

CIS DEFENSE MINISTERS MEET. Defense ministers from the CIS states
were scheduled to meet in Moscow on 3 July to prepare for the
6 July meeting of CIS heads of state, Interfax reported. Participants
were to discuss a broad range of military issues, including the
basics of CIS military doctrine and nuclear strategy. One of
the more contentious issues to be discussed involves the status
of CIS strategic nuclear forces located in Ukraine. Meanwhile,
CIS military spokesman Lt. Gen. Leonid Ivashov told ITAR-TASS
on 2 July that six draft military documents will be included
on the 6 July agenda, including agreements on ballistic missile
early warning systems and monitoring of space, on air defense,
and on the status of CIS strategic forces. (Stephen Foye)

UKRAINE: RATIFIES CFE; ON ARMY. Ukrainian Deputy Foreign Minister
Boris Tarassuk announced on 2 July that Ukraine's parliament
had ratified the Conventional Forces in Europe (CFE) treaty,
AFP reported. According to a Radio Moscow report on the same
day, Tarassuk also said that Ukraine would continue to maintain
the second largest army in Europe, even after putting into effect
the CFE-mandated reductions. His statement suggests that Ukraine
intends to maintain armed forces of at least 400,000 men, which
appears to be a reversal of earlier policy statements saying
that Ukraine would cut its forces to the 200,000-250,000 range.
Tarassuk's statement remains unconfirmed. (Stephen Foye)

COUNCIL OF RUSSIAN FOREIGN POLICY MEETS. The protection of the
rights of the Russians living in neighboring states remains a
priority of Russian foreign policy, Foreign Minister Andrei Kozyrev
said. At the first meeting of the newly created Council of Russian
Foreign Policy, which consists of various deputies, journalists,
scientists and businessmen, the former Soviet dissident Sergei
Kovalev praised the Russian Foreign Ministry's policy of protecting
Russian minorities not by force but by appeals to international
legislatures, ITAR-TASS reported on 2 July. Kozyrev stated that
for the first time in Russian history, the country does not face
a potential enemy. The council proposed the creation of a ministry
for CIS affairs. (Alexander Rahr)

MORE WARNINGS OF GROWING ANTI-GOVERNMENT FORCES IN RUSSIA. During
the council meeting on 2 July, Andrei Kozyrev, as well as top
Americanist Georgii Arbatov, and former Yeltsin adviser Sergei
Shakhrai, warned of a growing anti-government alliance, Interfax
and the New York Times reported on 3 July. They called attention
to what they believe is a threatening "Red-Brown" alliance of
left- and right-wing extremists. "It's extremely dangerous,"
Arbatov said, noting in particular the disaffection of the army
and the military-industrial complex, both of which are threatened
by ongoing economic and social reforms. Arbatov criticized, among
other things, the government's lack of attention to defense industry
conversion. (Brenda Horrigan)

14TH ARMY COMMANDER ON "SHIFT IN RUSSIAN POLICY." At his inaugural
news conference in Tiraspol, the new commander of Russia's 14th
Army stationed in Moldova, Maj. Gen. Aleksandr Lebed, termed
the right-bank city of Bendery as "an inalienable part of the
Dniester republic" and "the Dniester republic itself a small
part of Russia," Moskovskie Novosti reported on 1 July. The General
also termed the CIS "an assemblage of abnormal states." Lebed
added that his appointment in Moldova, as well as that of General
Boris Gromov to the position of Russian deputy defense minister,
"is connected to a massive shift in the policy of the Russian
government." Moskovskie Novosti commented that the Dniester area
could be "an ideal testing ground for the new policy." (Vladimir
Socor)

MOLDOVA ALARMED. The Moldovan government is alarmed by the spate
of allegations, which it terms fabricated, on CIS and Russian
television, according to which Moldovan forces are attacking
Russian military units on the Dniester. Those allegations are
linked to the order issued on 1 July by Russia's acting Prime
Minister Egor Gaidar, as reported by Russian TV that day, authorizing
Russian forces to open fire in response to attacks. Chisinau
is concerned that a pretext for opening fire against Moldovan
forces is being sought. (Vladimir Socor)

UKRAINIAN GOVERNMENT FACES CONFIDENCE VOTE. The Ukrainian parliament
on 2 July voted overwhelmingly to consider the question of confidence
in the cabinet of ministers headed by Vitold Fokin on the parliamentary
agenda, Radio Ukraine reported. The issue will be considered
during the 3 July session. The lawmakers took the step after
the government announced that it would free food prices. Demands
for the cabinet's resignation have been made by various political
parties and groups in recent weeks. (Roman Solchanyk)

COMMUNISTS IN THE CRIMEA. Molod Ukrainy of 26 June reported that
the former first secretary of the Crimean Communist Party organization,
Leonid Hrach, recently reemerged as head of the newly-formed
"Union of Communists of Crimea." In addition, the peninsula is
home to the "Socialist Party of Toilers of Crimea" and the Sevastopol-based
"All-Union Communist Party of Bolsheviks." (Roman Solchanyk)


RUSSIAN PARLIAMENT DELAYS TAX CUT VOTE. On 2 July, the Russian
parliament gave preliminary approval to a bill that would reduce
the rates of value-added and personal income taxes, ITAR-TASS
reported. The size of the proposed reductions was not specified,
and a final vote was postponed to enable the government and the
parliament to resolve their differences. During the debate, which
was enlivened by heated exchanges between Gaidar and Khasbulatov,
it was proposed that VAT be cut from 28% to 14%, and that the
highest personal income tax rate be reduced from 60% to 30-40%.
Gaidar's presentation of the second-stage economic reform program
was rescheduled for 3 July. (Keith Bush)

YELTSIN AND RUTSKOI GET PAY RAISES. The Russian parliament voted
on 2 July to increase the salaries of President Yeltsin and Vice-president
Rutskoi, ITAR-TASS reported. Yeltsin's pay rises from about 4,000
rubles to 18,900 rubles per month, while Rutskoi's salary was
increased to 15,300 rubles per month. At current rates of exchange,
these work out at around $140 and $113 a month respectively.
The presidential salary is set at a multiple of 21 times the
minimum salary, which is currently 900 rubles per month. (Keith
Bush)

NUCLEAR WEAPONS WORKERS WARN OF INDUSTRY'S COLLAPSE. A letter
from nuclear weapons' industry employees warns President Yeltsin
of a crisis situation in this sector of the defense industry,
according to a 25 June Pravda report. The letter marks the beginning
of a "qualitatively new phase" in the collapse of the Russian
economy. It protests the low sectoral pay scale and recent non-payment
of wages, and claims that the situation is driving these workers
to sell their skills elsewhere. Pravda noted that the industry
also is plagued by rising unemployment and a lack of incoming
young cadres. Recalling Yeltsin's failure to fulfill promises
made to workers earlier this year during a visit to the Arzamas-16
factory, Pravda noted that, "When the trolleybus drivers are
on strike, it is bad; when it's the medics, it's even worse.
But it is difficult to imagine what would happen if the nuclear
weapons workers go on strike." (Brenda Horrigan)

AFRICAN COUNTRIES SEEK FSU DEBT RELIEF. A resolution was passed
at the 28th summit of the "Organization of African Unity" in
Dakar seeking relief for OAU members from repaying debts owed
to the former Soviet Union, Western agencies reported on 2 July.
The resolution called for cancellation of military debts and
rescheduling of civil debts. Russian sources are quoted as putting
the total debts of OAU members to the FSU at about 14 billion
convertible rubles. This compares with total debts owed to the
FSU by third-world and former socialist countries estimated at
86 billion convertible rubles at the end of 1989 (see Izvestiya,
2 March 1990). Little if any of this debt is likely to be repaid.
(Keith Bush)

RUSSIAN WAGES COMPARED. Pravda on 30 June published data on wage
levels. The highest paid in Russia today are said to be presidents
of stock or commodity exchanges (earning up to 80,000 rubles
per month), followed by private businessmen (up to 55,000 rubles)
and street traders (up to 15,000 rubles). [Pravda provocatively
interjects that a beggar can collect anywhere between 9,000 and
15,000 rubles month.] By contrast, an army general earns a maximum
of only 10,000 rubles and the director of a state enterprise,
6,500 rubles. A construction worker can earn up to 3,500 rubles.
The lowest pay goes to kindergarten teachers (maximum 1,500 rubles)
and manual workers (1,300 rubles). (Elizabeth Teague)

RUBLE STRENGTHENS AT CURRENCY AUCTION. At the first Moscow currency
auction since the exchange rate was unified and allowed to float--albeit
dirtily--the ruble strengthened from about 145 rubles to 134.8
rubles to the dollar, Western agencies reported on 2 July. As
in the case of exchange rate movements in other currencies, pundits
had been unable to forecast the change but were quick to explain
it after the event. Favored explanations were that the ruble
had been undervalued going into the float because of panic selling,
and that commercial banks had been holding a lot of hard currency
and wanted to unload it. (Keith Bush)

KAZAKHSTAN BANS GRAIN EXPORTS. Kazakh President Nursultan Nazarbaev
has signed a decree prohibiting the sale of grain to other countries
"until special instructions are issued by the Council of Ministers,"
Interfax reported on 2 July. A special commission has been established
to monitor local compliance with the decree and to check on harvest
efficiency. The Kazakh government is charged with "fixing a maximum
(sic) purchase price for grain, with world market prices in mind,"
so that Kazakh wheat growers are encouraged to sell their grain
for domestic consumption. (Keith Bush)

SIBERIAN COSSACKS TO DEFEND COSSACKS IN KAZAKHSTAN. A meeting
of the "Large Cossack Circle of Siberia and the former Steppe
Krai" (northern Kazakhstan) in Omsk on 1 July condemned the violation
of the rights of Russians in Kazakhstan, ITAR-TASS reported.
The circle appealed to the Russian and Kazakh parliaments and
presidents to protect the rights of the Russian population, adopt
a law on dual citizenship, put a stop to the renaming of Russian
settlements and the destruction of Russian monuments. If no action
was taken, the question of a referendum on autonomy would be
raised and the circle reserved the right to defend its brothers
by all available means. (Ann Sheehy)

UZBEK SECURITY FORCES PREVENT DEMONSTRATION. On 2 July, an RFE/RL
correspondent reported from Tashkent that police and military
troops surrounded the central area of Tashkent, where a demonstration
organized by the democratic opposition groups "Birlik" and "Erk"
had been planned. The protest was intended to mark the opening
of the Supreme Soviet session, and to call for new elections
to be held under a more democratic election law. Troops blockaded
the main streets of Tashkent with busses and closed many metro
stations. The headquarters of Erk was surrounded, and 16 of its
members arrested. The headquarters of Birlik, which the government
refuses to register as a political party, had already been closed
in May. A demonstration was also reportedly forcibly dispersed
in Samarkand. (Cassandra Cavanaugh)

"ERK" DEPUTY RESIGNS. Supreme Soviet deputy, chairman of the
"Erk" party and writer Mohammed Solih resigned from his seat
at the opening session, after he was prevented from giving a
speech on the political situation in the republic, an RFE/RL
correspondent reported on 2 July. He said he could no longer
participate in the "anti-democratic, communist" parliament. Meanwhile,
"Birlik" Chairman Abdurakhim Pulatov remains in critical condition
in a Tashkent hospital, where he was taken on 30 June after government-sponsored
attackers fractured his skull. (Cassandra Cavanaugh)

TAJIK BORDER VIOLATORS CAPTURED. While attempting to halt a group
of armed Tajiks returning across the border from Afghanistan,
one border guard was killed by automatic weapons fire, a correspondent
from the Khovar news agency reported on 1 July. One of the violators
was also killed, and four were captured. The group had been transporting
weaponry into Tajikistan, including two grenade launchers, 11
pistols, 19 grenades and two radio transmitters. The border guards
have accused residents of the border regions of Tajikistan of
obstructing their attempts to stop such weapons trade. (Cassandra
Cavanaugh)

MORE ON RUSSIAN MILITARY INVOLVEMENT IN MOLDOVA FIGHTING. Nezavisimaya
Gazeta of 1 July cited "a Russian state counselor," who monitored
the recent fighting in and around Bendery, as confirming that
officers and tanks of Russia's 14th conducted the attack which
drove the Moldovans out of Bendery and secured the city for the
"Dniester guard." (Vladimir Socor)

RUTSKOI CONSIDERED LANDING TROOPS IN MOLDOVA. The same Russian
state counselor recounted that Vice-president Aleksandr Rutskoi,
in charge during Yeltsin's North American visit, seriously considered
landing Russian paratroops in Moldova during the fighting in
Bendery. Rutskoi and the "situation staff" he assembled in the
Kremlin considered sending either the Tula or the Pskov paratroop
division by air, or the Bolgrad division by land. The main consideration
preventing the measure was the need to obtain Ukraine's consent
for transiting the troops. (Vladimir Socor)

ZHIRINOVSKY'S MEN FIGHTING IN MOLDOVA. Russian ultranationalist
leader Vladimir Zhirinovsky's press office told Interfax on 28
June that "many Zhirinovsky supporters are fighting on the side
of the Dniester [republic]" and that a further group of 25 volunteers
from the Siberian city of Krasnoyarsk is about to join the fighting.
(Vladimir Socor)

CENTRAL AND EASTERN EUROPE

U.N. FORCES SECURE SARAJEVO AIRPORT. A Canadian infantry battalion
reached Sarajevo airport on 2 July after forcing its way through
a Serbian roadblock 75 miles northwest of Sarajevo. No shots
were exchanged, although the Canadians, members of the U.N. peacekeeping
force, had to assume combat positions as they made their way
through the roadblock. Forty U.N. armored vehicles were deployed
around Sarajevo airport on Thursday, and an American and a French
cargo plane carrying relief supplies arrived with food and medicine.
A force of 1,500 Ukrainian, French and Egyptian troops are to
replace the Canadians within days. (Gordon Bardos).

OTHER YUGOSLAV NEWS. Milan Panic, a 62-year-old Serbian-born
American citizen, announced on 2 July that he is returning to
Yugoslavia to assume the position of prime minister. Panic, who
is the founder and chairman of I.C.N. Pharmaceuticals, an international
drug manufacturer, had to receive special permission from the
US administration to accept the post. In Belgrade, meanwhile,
the demonstrations against Milosevic continued, and participation
was reported to be largest since their beginning, five days ago.
Also on 2 July, Milan Babic, a leader of the Serbs fighting in
Croatia, was wounded in an assassination attempt in Knin. Babic's
aides suggested Milosevic was behind the attempt. (Gordon Bardos
and Michael Shafir).

HUNGARY CONTINUES TO ACCEPT YUGOSLAV REFUGEES. Denes Tomaj, deputy
secretary of state at the Hungarian foreign ministry, reiterated
on 2 July that Hungary will continue to accept refugees from
former Yugoslavia, Western agencies and MTI report. Tomaj added
that Hungary will not follow Austria's example in introducing
visa requirements for holders of Yugoslav passports. Hungarian
border guards spokesman Janos Zubek said that at least 1,300
refugees trying to cross into Austria from Hungary were refused
entry on 2 July when the Austrian restriction came into effect.
He estimated that 20,000 Bosnians want to travel through Hungary
to destinations in Western Europe, and warned that Hungary cannot
accommodate them all. Jozsef Wessetzky, deputy head of the Hungarian
refugee office, said that new camps will be opened near the Yugoslav
border and will accommodate some 5,000 refugees. (Edith Oltay)


REFUGEES IN HUNGARY. Hungarian minister of the interior Peter
Boross told the parliament of the Council of Europe in Budapest
that there were currently some 100,000 refugees in Hungary, MTI
reported on 1 July. He estimated the number of ethnic Hungarians
immigrants from neighboring countries at some 72,000 to 74,000.
Boross put the number of war refugees from the territory of former
Yugoslavia at some 40,000 to 50,000. He reported that the number
of refugees from Bosnia is increasing. (Edith Oltay)

ROMANIA PROTESTS STATEMENTS BY 14th ARMY CHIEF. On 1 July Romania's
foreign minister Adrian Nastase sent a formal letter of protest
to his Russian counterpart, Andrei Kozyrev, over the status of
Russia's 14th army stationed in Moldova, Western agencies report.
The letter criticizes what is described as the "warlike" statements
made by the army's commander, major general Aleksandr Lebed.
On 29 June Lebed said in Tiraspol that Romania should not be
allowed to participate in peace talks concerning the future of
Moldova's Dniester region. A spokesman for Romania's foreign
ministry said such statements contradict decisions taken by the
foreign ministers of Moldova, Russia, Ukraine, and Romania in
Istanbul on 25 June. (Dan Ionescu)

NO PROGRESS IN POLISH GOVERNMENT TALKS. Refusing to accede to
Prime Minister Waldemar Pawlak's request for dismissal, President
Lech Walesa attempted on 2 July to revive talks on the formation
of a government coalition. Despite a new statement of willingness
to enter the cabinet from the "little coalition," the presidential
push appears to have failed. Evening talks were broken off at
Pawlak's initiative. Insisting their stance had been flexible,
"little coalition" leaders said they had offered new ministerial
candidates to replace figures rejected by Pawlak as too controversial.
Meanwhile, the five-party Christian-democratic and peasant alliance
called the prolonging of Pawlak's mission "irresponsible" and
appealed once again for a majority coalition based on Solidarity
forces. (Louisa Vinton)

FEDERAL AND CZECH GOVERNMENTS SWORN IN. President Vaclav Havel
swore in Czechoslovakia's new federal government on 2 July, CSTK
reported. The country's new prime minister, Jan Strasky, said
he will keep the country on the path of reform to prevent the
Czechoslovak federation from collapsing before its time. He also
said that the government's program would set agenda only for
the next three months; the Czech and Slovak republican parliaments
are to decide the fate of the common state by 30 September. The
new Czech government, headed by Vaclav Klaus, was sworn in on
2 July. Klaus vowed to continue with radical political and economic
changes. He also said that his government wanted to build "firm
foundations of the Czech statehood." (Jiri Pehe)

HAVEL COMMENTS ON POSSIBLE BREAKUP OF CZECHOSLOVAKIA. In an interview
with the French daily Le Monde published on 2 July, Czechoslovak
President Vaclav Havel said that if his country breaks apart,
the process of disintegration will not be marked by the violence
that now occurs in the former Yugoslavia and the former Soviet
Union. Havel argued that what is going on in the former Soviet
Union and in the Balkans is a tragedy, while developments in
Czechoslovakia are "more like the theater of the absurd, boulevard
comedy or even farce." He also said he might stand for president
of the Czech Republic if Czechoslovakia breaks apart. Havel is
standing for reelection as President of Czechoslovakia today.
(Jiri Pehe).

POSSIBLE PROGRESS ON TROOP WITHDRAWAL FROM LATVIA. The third
meeting of Latvian and Russian experts dealing with ex-USSR troops
withdrawal ended in Jurmala on 2 July on a rather optimistic
note, Radio Riga reported. To start the process, Russian experts
said that Moscow would pull out about 16,000 troops and vacate
some 81 military objects in Latvia. No agreement was reached
on the more thorny issues, such as the date for completing the
withdrawal process, ownership of property occupied by the ex-USSR
military, and compensation for damage done by the military. The
Russian side insisted that it was in Russia's strategic interests
to hold on to the radar station in Skrunda, the military harbor
in Liepaja, and the cosmic communications facility in Ventspils.
(Dzintra Bungs)

LITHUANIA PRESENTS PLAN FOR TROOPS WITHDRAWAL. At a press conference
on 2 July the head of the Lithuanian delegation for negotiations
with Russia, deputy parliament chairman Ceslovas Stankevicius
revealed that on 30 June he had sent his Russian counterpart
Viktor Isakov a letter with a detailed plan for the withdrawal
of Russian troops from Lithuania in four months, Radio Lithuania
reports. There was no response to the letter's suggestion that
the next meeting of experts dealing with the withdrawal should
be held in Vilnius on 2-3 July. (Saulius Girnius)

DETAILS OF PLAN. At the same press conference National Defense
Minister Audrius Butkevicius refuted Russian claims that the
withdrawal was impossible due to lack of housing for officers
and overcrowding of railroad transport. 7,500 of the 10,500 officers
have apartments in Lithuania whose sales would provide funds
for purchasing new housing elsewhere. Lithuanian railroad officials
calculate that Russia would require 224 trains with 10,000 railway
cars to withdraw all its troops and their equipment. The average
of 55 trains per month would be slower than the pace of the withdrawal
from Hungary (80 trains per month) and there would not be any
overcrowding due to the 30% decrease this year in Lithuanian
railroad traffic. (Saulius Girnius)

NEW ESTONIAN CONSTITUTION TAKES EFFECT. On 2 July, the Estonian
Referendum Committee released the official results of last Sunday's
constitutional referendum. Sixty-seven % of all eligible voters
had voted. Of those, 91% voted for adopting the new constitution.
The second question, on widening the franchise was supported
by only 46%, and was therefore rejected by the electorate. BNS
reported the official results. (Riina Kionka)

RUSSIA PROTESTS TO ESTONIA. The Russian Foreign Ministry on 1
July protested against the "deprivation of political and representation
rights" of ethnic Russians in Estonia. ITAR-TASS quoted a Russian
Foreign Ministry statement as saying that both the outcome of
Estonia's constitutional referendum and the "provocative attitude"
of Estonian authorities on the withdrawal of former Soviet troops
complicates bilateral relations in a "particularly serious way."
(Riina Kionka)

TALLINN TO GARRISON THE TROOPS? The Tallinn City Council voted
on 2 July to restrict the movement of Russian troops and equipment
within the city limits. According to BNS, the city hopes to enforce
the restriction with the help of the police and Estonia's two
home guard groups. (Riina Kionka)

MOLDOVAN MEDIEVAL RULER CANONIZED. On 2 July more than 15,000
persons attended a ceremony at Putna monastery for the canonization
of Stephan the Great, Moldova's ruler between 1457 and 1504,
known for having defended his country against the Turks. According
to Radio Bucharest, thousands of ethnic Romanians from Ukraine
and the Republic of Moldova crossed into Romania to celebrate
the event. The ceremony, which was led by Patriarch Teoctist
of the Romanian Orthodox Church, was attended by president Ion
Iliescu, foreign minister Adrian Nastase, and defense minister
Nicolae Spiroiu. The canonization comes against a background
of clashes in the Dniester region, and is perceived as largely
a political gesture. (Dan Ionescu)

NO SOLUTION TO BULGARIAN CHURCH CONFLICT. Contrary to expectations,
the long awaited ruling of Supreme Court failed to clarify which
is the legitimate leadership of Bulgaria's Orthodox Church. On
2 July the Supreme Court stated that the complaint filed by the
original Holy Synod--led by communistappointed Patriarch Maksim--against
the alternative Synod supported by the Directorate of Religious
Affairs, had been submitted too late and could therefore not
be considered. In interviews broadcast on Bulgarian radio, both
sides claimed that the ruling supported their view. Observers
said the conflict can only be solved by holding nation-wide elections
of church representatives. (Kjell Engelbrekt)

BULGARIAN AND TURKEY TO WITHDRAW TROOPS. On 2 July, during a
visit to Ankara by Bulgaria's Chief of General Staff, lieutenant
general Lyuben Petrov, Turkish officials announced that a significant
number of troops would be pulled back from the Turkish-Bulgarian
border. According to Western agencies, Turkey is willing to withdraw
both an infantry battalion stationed in Edirne and a tank battalion
in Kirklareli. Petrov was quoted as saying that Bulgaria was
ready to reciprocate. (Kjell Engelbrekt)

POLISH ECONOMIC REFORM: TWO VIEWS. In a report on the Polish
economy issued on 3 July, the OECD lamented that political difficulties
threatened to slow the pace of economic reform. OECD assistant
secretary-general Salvatore Zecchini spoke of a "vacuum in political
decision making," Western agencies reported. Conceding that some
impetus had been lost, deputy economic cooperation minister Andrzej
Byrt responded that IMF guidelines would likely be accepted by
any new government and noted that Poland was the first former
communist country in which the private sector employed more than
50% of the working public. Byrt added that private industry now
accounted for 30% of the GNP (excluding agriculture). (Louisa
Vinton)

CONSUMER PRICES SOAR IN ROMANIA. On 2 July the daily Cotidianul
published figures showing that consumer prices in Romania have
doubled on average every six months since October 1990. Cotidianul
said that the average inflation rate was almost 12% a month and
increases in the cost of food were even higher. According to
the daily, inflation has considerably reduced the Romanians'
interest in keeping money in saving accounts. (Dan Ionescu)

SWEDEN TO COMPENSATE ESTONIA, LITHUANIA FOR GOLD. Sweden has
decided to compensate Estonia and Lithuania for gold transferred
by the Swedish government to the USSR in 1940, after the occupation
of the Baltic States. The gold, now worth some 46.6 million dollars,
had been deposited in Sweden before World War II by Estonia and
Lithuania. A Swedish government statement of 1 July said that
the two countries can decide if they want repayment in gold or
in cash and indicated that Sweden would like to complete the
transactions as soon as possible. Estonian and Lithuanian officials
indicated that they would opt for having the gold back, Western
agencies reported on 1 July. (Dzintra Bungs)

POLAND, ESTONIA SIGN FRIENDSHIP TREATY. Polish Foreign Minister
Krzysztof Skubiszewski and his Estonian counterpart Jaan Manitski
signed a treaty on cooperation and good-neighborly relations
in Tallinn on 2 July, Polish television reported. Manicki commented
that Estonia's path to Europe leads through Poland. (Louisa Vinton)


[As of 1200 CET]