No. 160, 21 August 1992

SUCCESSOR STATES TO THE USSR

GERASHCHENKO WANTS TO RENEGOTIATE WITH THE IMF. Russian central
bank chairman Viktor Gerashchenko said in an interview summarized
by the Washington Post on 21 August that it was unrealistic to
expect adherence to the IMF's existing conditions for economic
aid. The limits on credit expansion and government spending would
devastate the Russian economy and, therefore, would have to be
renegotiated. Gerashchenko said that the current agreement puts
a 700-billion-ruble ceiling on the issue of central bank credits
in the second half of this yearconsiderably less than he feels
necessary to keep the economy afloat. Gerashchenko will make
his case directly to the IMF when a Fund team arrives in Moscow
next week for further aid negotiations. (Erik Whitlock)

KHASBULATOV ON CIS. In a talk on Russian television to mark the
anniversary of the August 1991 coup, the chairman of the Russian
Supreme Soviet, Ruslan Khasbulatov, said that the initial euphoria
over the independence of the republics of the former Soviet Union
was passing and that there was a strong desire on the part of
their peoples, and not just their leaders, to unite in one form
or another, ITAR-TASS reported. He said this did not mean abandoning
the CIS and constructing something new, but strengthening the
Commonwealth. Khasbulatov said that the first session of the
CIS interparliamentary assembly, due to take place in Bishkek
in September (presumably in conjunction with the meeting of CIS
heads of state and government) was a very serious beginning,
which should reinforce the agreements signed by CIS leaders and
stimulate integration. (Ann Sheehy)

RUSSIAN PAYMENTS FOR GRAIN SHIPMENTS. The president of Eksportkhleb
told Interfax on 20 August that the Russian finance ministry
has agreed to settle part of the arrears owed to Canada for grain
shipments. Oleg Klimov stated that the ministry could pay only
part out of current resources, but it "made assurances that the
question of due payments will be reviewed regularly." He hoped
that Canada would resume grain exports to Russia. Two days after
the Canadians halted grain shipments, ITAR-TASS on 19 August
reported that the Australian Wheat Committee had decided to sell
further wheat to Russia only for hard currency and only when
the Russian arrears of $50.7 million for previous deliveries
had been paid. (Keith Bush)

YELTSIN LEVIES NEW TAX ON OIL. A new presidential decree will
require oil and gas enterprises to pay a new excise tax, Interfax
and Western agencies reported on 20 August. Although few details
are available, the size of the taxes will be determined by the
quality of the extraction site; the more productive the field,
the higher the tax. As such, the new levies are a type of rental
payment to the state for using national resources. The government
also hopes the tax will encourage exploitation of less accessible
deposits. It was not clear how the tax would effect energy prices
for consumers. (Erik Whitlock)

SHUMEIKO DEVELOPING RUSSIAN INDUSTRIAL POLICY. Various governmental
officials gathered to discuss a comprehensive policy for arresting
the fall of industrial output, ITAR-TASS reported on 20 August.
Deputy Prime Minister Vladimir Shumeiko said that in the coming
months, the government would be meeting with enterprise directors
to establish measures to support "priority" industries. Although
Shumeiko was careful to emphasize that such measures would not
get in the way of current privatization plans, the program seems
to represent another channel through which the industrial lobby
can influence the future course of economic reform. (Erik Whitlock)


GAIDAR: NO REGRETS. At a time when rumors of his replacement
or resignation are rife, acting Russian Prime Minister Egor Gaidar
has published an extensive and eloquent credo in Izvestiya of
20 August. Whetting readers' appetites, he writes: "For several
months I have tried as far as possible to refrain from public
polemics. But the time has come to have it out." However, he
doesn't name names, but merely criticizes the military-industrial
complex, the agrarian lobby, and those sectors demanding subsidies
and customs protection. Gaidar restates his customary thesis
that everything is under control: "the country is manageable,
the market has started to work, no famine is predicted." (Keith
Bush)

MEETING OF CIS CONSULAR SERVICES ENDS. A meeting of the heads
of the consular services of CIS member-states ended in Minsk
on 20 August with the initialling by ten of them (excluding Turkmenistan)
of protocols on visa-less travel by citizens of CIS states on
the territory of CIS countries and the mutual recognition of
visas issued to foreigners, BelInform-TASS reported. It was also
agreed that citizenship documents of the former USSR would be
regarded as valid until citizenship documents of the newly-independent
states were issued. The protocols will be submitted to the heads
of CIS governments for signature at their September meeing in
Bishkek. (Ann Sheehy)

PERES IN MOSCOW. Israeli Foreign Minister Shimon Peres and Russian
Foreign Minister Andrei Kozyrev held talks on 20 August to discuss
a Middle East peace settlement. Following talks, Kozyrev said
Russia is doing everything it can to help both sides reach an
agreement. Peres said that Israel respects Russia's role in the
peace process. Radio Moscow stressed that the talks had taken
place at Israel's initiative. Following discussions with Kozyrev,
Peres met with Russian Prime Minister Gaidar to sign an agreement
on trade and agricultural cooperation, Western and Russian agencies
reported. (Suzanne Crow)

KOZYREV WARNS NATIONALISTS. Andrei Kozyrev defended Moscow's
policy toward the Yugoslav conflict in an article published in
Nezavisimaya gazeta on 20 August. Rejecting Russian nationalists'
attempts to use the "infamous Slavic factor" in an attempt to
tilt Russia's policy unconditionally toward Serbia, Kozyrev said
that Russia would play a leading role in the Balkans "in matters
of fairness" and defended Russia's recognition of Macedonia in
evidence, Western agencies reported. Meanwhile, according to
statements by Oleg Rumyantsev, executive secretary of the constitutional
affairs commission, Russia has not been invited to the London
conference on Yugoslavia, scheduled for 26 August, Interfax reported
on 19 August. (Suzanne Crow)

ZHIRINOVSKI, LEBED ON REDUCING MOLDOVA'S SIZE. While on a visit
to Germany, the ultranationalist politician Vladimir Zhirinovsky
called for reducing Moldova and the Baltic States "to the size
of Liechtenstein" as part of a general change of borders in favor
of Russia. He also praised Maj. Gen. Aleksandr Lebed, the commander
of Russia's 14th Army in Moldova, as "a true patriot," the Frankfurter
Allgemeine Zeitung reported on 19 August. Lebed, whose threats
to use force against Moldova have been widely reported, has also
called recently for reducing Moldova in size by annexing areas
on the right bank of the Dniester to the left-bank "Dniester
republic." (Vladimir Socor)

UKRAINE'S NEW MERCHANT MARINE HOISTS NATIONAL FLAG. In at least
one area, Ukraine and Russia have managed to resolve a question
connected with the Soviet inheritance: the division of the former
Soviet merchant marine. On 20 August, Ukrainian Television showed
ceremonies at which the first 200 or so merchant ships of the
1,500-vessel fleet which Ukraine has inherited from the USSR
after successful negotiations with Russia lowered the former
Soviet flag and hoisted Ukraine's blue and yellow national colors.
(Bohdan Nahaylo)

UKRAINE BEGINS INDEPENDENCE ANNIVERSARY CELEBRATIONS. On 21 August,
Ukrainian President Leonid Kravchuk is due to open a World Forum
of Ukrainians in Kiev, which will bring together about 1,000
representatives from Ukraine and its large "Eastern" and "Western"
diaspora. The forum, which has been much publicized, is part
of the elborate celebrations marking the first anniversary of
Ukraine's independence (24 August). As part of the official celebrations,
on 22 August, the Ukrainian parliament is convening a special
session. The festivities will continue into next week. (Bohdan
Nahaylo)

ANOTHER UKRAINIAN UN PEACEKEEPING SOLDIER KILLED IN BOSNIA. A
second Ukrainian soldier serving in the UN peacekeeping force
in Bosnia has been killed, Western and CIS agencies reported
on 20 August. He was killed by sniper fire in Sarajevo. Another
Ukrainian soldier was killed in Sarajevo less than three weeks
ago and several other Ukrainian soldiers have been injured. (Bohdan
Nahaylo)

KGB'S SOPHISTICATED MANIPULATION BY MASS MEDIA. According to
a former KGB officer and member of the former Fifth Main Administration,
Alexander Kichikhin, the anti-KGB campaign that surfaced in the
central mass media from mid-1990 to August 1991 was part of a
plan designed by the KGB itself, Komsomolskaya pravda reported
on 19 August. The goal of this campaign was to prevent cooperation
between KGB officers and the democratic opposition and to provoke
antagonism between young KGB officers and Boris Yeltsyn's supporters.
Having worked himself in the Fifth Main Administration, which
was responsible for manipulating the mass media, Kichikhin expressed
concern that the new Russian Ministry of Security was capable
of carrying out the same types of operations. (Victor Yasmann)


NORTH CAUCASIAN LEADERS DISCUSS ABKHAZIA. Leaders of Adygeya,
Dagestan, Kabardino-Balkaria, and North Ossetia, that is, all
the north Caucasian republics except Chechnya and Ingushetia,
together with the leaders of Krasnodar and Stavropol krais and
Rostov oblast held a closed door meeting in Armavir on 20 August
to discuss the situation that has arisen as a result of Georgian
troops entering Abkhazia, ITAR-TASS reported. They drafted an
appeal that will be handed personally to Yeltsin by members of
a delegation who will discuss with Yeltsin the participation
of North Caucasus representatives in regulating the conflict
in Abkhazia. They will send humanitarian aid to Abkhazia and
set up a permanent consultative council to prevent future conflicts.
(Ann Sheehy)

DUDAEV VISITS SAUDI ARABIA. Chechen President Dzhokhar Dudaev
arrived in Saudi Arabia on 20 August for what was described as
his first official visit to an Arab country, ITAR-TASS reported.
Dudaev told ITAR-TASS that Chechnya was seeking nothing from
Saudi Arabia but the secrets of its economic success. He said
that a Chechen trade representation would be opened in Jiddah
before the end of his visit, to be headed by a Saudi of Chechen
origin. Dudaev said he would visit Jordan when he left Saudi
Arabia. Dudaev's visit suggests that he is not worried by the
possibility of being overthrown in his absence, and also that
his threat to take action against Georgia in connection with
Abkhazia is serious. (Ann Sheehy)

IMF GIVES TAJIK APPLICATION GREEN LIGHT. Khovar-TASS reported
on 20 August that an International Monetary Fund delegation visiting
Tajikistan approved that country's application for membership.
Tajik Deputy Prime Minister Tukhtaba Gafarov told the delegation
that Tajikistan has an economic development plan based on the
transfer to a market system. The delegation, which is conducting
talks on the terms for Tajikistan's membership, announced that
the IMF is "extremely interested in establishing close and constant
ties with Tajikistan." (Cassandra Cavanaugh)

MOLDOVAN PREMIER IN ROMANIA. Moldova's prime minister, Andrei
Sangheli, headed a large government delegation to Romania for
a "working visit" on 18 and 19 August, Moldovan and Romanian
media reported. Sangheli and Romanian Prime Minister Teodor Stolojan
voiced the hope of revitalizing relations, bilateral trade turnover
being only 43 million dollars so far this year. Sangheli also
had talks with Romanian President Ion Iliescu and Foreign Minister
Adrian Nastase. Stressing that the talks covered economic, not
political issues, Sangheli mentioned that Romania provided Moldova's
sole road and rail access to the West. Most of the Romanian press
played downthe visit while continuing to attack the Moldovan
government for opposing unification with Romania. (Vladimir Socor)


SNEGUR CABLES YELTSIN. Moldovan President Mircea Snegur sent
Russian President Yeltsin a telegram congratulating him on the
first anniversary of the defeat of the putsch. He said that Moldova
was proud of having rallied to the support of Russian democrats
and Yeltsin personally in resisting the putsch from the the very
beginning, Moldovapres reported. Snegur also recalled that the
"Dniester" leaders had supported the putsch from the start, and
had followed up by initiating military operations against Moldova.
Snegur expressed the hope that Moldovan-Russian relations would
develop on the basis of mutual cooperation and noninterference.
Snegur's comments reflect Moldova's dismay over the support extended
to the "Dniester" insurgents by Russian political and military
circles. (Vladimir Socor)

MOLDOVAN APPEAL TO UN. In a message to UN Secretary General Boutros-Ghali
on 19 August, reported by Moldovapres, Foreign Minister Nicolae
Tiu asked that the UN send military observers and human rights
experts on a fact-finding mission to Moldova. Tiu listed violations
of the ceasefire by unlawful "Dniester" forces and persecution
of the indigenous Moldovan population by the "Dniester" authorities,
which, he feared, further undermined the ceasefire and the prospects
of a political settlement of the conflict. (Vladimir Socor)

CENTRAL AND EASTERN EUROPE

SARAJEVO FIGHTING INTENSIFIES. Sarajevo suffered another round
of bombardment on 20 August, reportedly the worst fighting in
more than a month. Mortar fire hit a barracks housing Ukrainian
members of the UN peacekeeping troops stationed in Sarajevo.
Although there were no reported casualties from the attack on
the barracks, eight UN vehicles were destroyed. Earlier in the
day, a Ukrainian soldier was killed by an unidentified sniper.
The Bosnian government building was also hit and on fire. Some
reports suggested that the Serbs were bombarding the city in
retaliation for Muslim sniper attacks. Despite the renewed fighting,
Sarajevo's airport was reopened for relief flights after being
closed for two days, 26 planes managed to land. In Belgrade,
meanwhile, a CSCE delegation led by Czech foreign minister Jozef
Moravcik expressed optimism about solving the Yugoslav crisis
after meeting with Serbian leaders. (Gordon Bardos)

SANDZAK MUSLIMS SEEK REPUBLIC. Sulejman Ugljanin, head of Sandzak's
main opposition Muslim Party of Democratic Action (SDA), informed
reporters on 20 August that representatives of the Muslim National
Council (MNC) would travel to London for the international conference
on Yugoslavia next week. Ugljanin said that the MNC had received
an invitation to attend from Lord Carrington, the EC's chief
mediator on Yugoslavia. Ugljanin also said that the MNC would
break all contacts with the authorities of Serbia, Montenegro,
and the rump Yugoslavia until "terror against Muslims stops and
the status of the Muslim people is resolved." On 19 August, SDA
secretary Rasim Ljalic said that the region, located in Serbia
and Montenegro, might secede and establish a republic if the
new rump Yugoslavia were internationally recognized. Radio Serbia
carried the reports. (Milan Andrejevich)

PANIC MEETS CSCE OFFICIALS, VIEWS KOSOVO. Milan Panic, head of
the rump Yugoslav government, asked a CSCE mission led by Czechoslovakia's
foreign minister Jozef Moravcik to assist in facilitating talks
between the Yugoslav government and Albanians in Kosovo. According
to a Radio Serbia report on 20 August, Panic said that the CSCE
could make a "real contribution in resolving the situation in
Kosovo, which would be far more effective than theorizing about
human rights." He stressed the need to involve Albanians in the
political system through elections and representation in government.
He added that Albanian protests and boycotts were "no features
of democracy." Panic informed the CSCE delegation that his government
was making efforts to reopen Albanian-language schools in Kosovo.
(Milan Andrejevich)

MECIAR'S MOVEMENT RETREATING FROM ITS POSITIONS? Speaking on
Czech Television on 20 August, Czechoslovak Prime Minister Jan
Strasky said that there are indications that the ruling party
in Slovakia, Vladimir Meciar's Movement for a Democratic Slovakia,
may be retreating from its original separatist positions. Strasky
pointed out that it was still possible to save the federation,
but suggested that the split of Czechoslovakia would be a better
solution. He said that the two new states could counclude treaties
which would make their mutual ties firmer than a federation could.
Czech Television suggested that Meciar's party was changing its
position because it was concerned about the growing popularity
of the post-communist Party of the Democratic Left and its planned
merger with Alexander Dubcek's Slovak Social Democrats. Both
of these parties insist on preserving Czechoslovakia. (Jiri Pehe)


SLOVAKS PROPOSE A NEW TYPE OF UNION. The Movement for a Democratic
Slovakia is proposing the creation of a Czech-Slovak union to
replace the current federal arrangement, CSTK reported on 20
August. A draft treaty prepared by the movement, to be soon submitted
to the ruling party in the Czech Republic, Vaclav Klaus's Civic
Democratic Party, suggests close coordination of foreign and
security policies between the Czech Republic and Slovakia through
regular meetings of the republics' presidents and prime ministers.The
draft also proposes the creation of a joint Czech-Slovak agency,
the Council of Ministers of Foreign Affairs. According to the
draft, citizens of either republic would automatically be citizens
of the other. (Jiri Pehe)

CZECH AND SLOVAK OFFICIALS COMMENT ON FUTURE COOPERATION. Speaking
at a press conference in Prague on 20 August, Czechoslovak Prime
Minister Jan Strasky said that a common market embracing both
the Czech and Slovak republics is possible even if Czechoslovakia
splits, as long as Slovakia is committed to privatization and
free market economics. Also on 20 August, Slovak Privatization
Minister Vladimir Dolgos told reporters in Vienna that Slovakia
remained committed to a sweeping privatization of state companies.
Slovak Finance Minister Julius Toth said that Slovakia wanted
to cooperate with the Czech Republic over monetary and customs
policies, but "it was not yet clear if the two republics would
share a common currency." (Jiri Pehe)

PLANS TO DIVIDE CZECHOSLOVAK INTERIOR MINISTRY. The ministers
of internal affairs of Czechoslovakia, Slovakia, and the Czech
Republic met in Bratislava on 20 August to dicuss the transfer
of the federal ministry's powers to the republican ministries
in case Czechoslovakia splits. CSTK reports that the ministers
agreed to set up seven commissions to solve legal issues associated
with the transfer of powers. The commissions will also deal with
cataloging the federal ministry's property, dividing its archives,
and documenting the border between the Czech Republic and Slovakia.
(Jiri Pehe)

COPPER COMBINE RETURNS TO WORK. The Polska Miedz copper combine
resumed production on 20 August amid disputes over whether the
strikers had won anything from their month-long strike. The agreement
suspending the strike granted no pay increases, with management
pledging only that it would offer the "highest wages possible"
within the limits of the firm's finances. This formulation seems
to have been designed to allow the strikers to save face. New
wage negotiations are to take place after revisions in the excess
wages tax, approved by the Sejm before the strikes began, become
law. The government denounced as a "serious abuse of the work
force" claims by strike organizers that only strike participants
would benefit from purported raises. Losses from the strike were
set at nearly one trillion zloty ($73,000,000). Presidential
spokesman Andrzej Drzycimski greeted the end of the strike as
a "positive solution." He added, "strikes and conflicts limit
our chances . . . and serve no good end . . . The trade unions
now organizing strikes do not represent all of society." (Louisa
Vinton)

SILESIA REMAINS RESTIVE. The government's success in halting
the copper strike may have turned the tide. The Silesian engine
drivers' strike proclaimed for 20 August drew only a limited
response; 82% of passenger trains functioned normally, according
to the director of state railways. Five Silesian coal mines also
remained on strike. Some 6,000 Solidarity adherents demonstrated
in Katowice on 20 August. The government is pushing ahead with
systemic restructuring plans to be negotiated centrally with
the major trade unions; on 20 August it presented miners' unions
with a ranking of mines according to profitability and future
prospects. The only major strike now underway is at the FSM auto
plant; and even the left-wing Union of Labor party acknowledged
that wage demands voiced by strikers there "exceed the wildest
income dreams of most Polish families." (Louisa Vinton)

GERMAN-POLISH POLICE COOPERATION. German Interior Minister Rudolf
Seiters met with President Lech Walesa and Prime Minister Hanna
Suchocka on the second day of his visit to Poland. Seiters said
he offered Poland a "special security partnership" to limit illegal
border crossings, fight organized crime and drug trafficking,
and open new border crossings. Germany pledged to give the Polish
police four million marks to combat the growing drug traffic
between the two countries. Internal Affairs Minister Andrzej
Milczanowski said Poland will consider meeting Germany's request
to introduce visas or invitations for Romanians. In connection
with Seiters's visit, Polish police announced that 36,000 auto
thefts had been reported in Poland so far this year, up from
4,100 in 1988 and 18,610 in 1991. Police officials noted, however,
that the "import" of stolen cars from Germany has become a less
tempting occupation for thieves; Poles now drive desirable luxury
cars, while Polish police are less threatening than German. (Louisa
Vinton)

MORE SECURITY FOR NARVA, PRESS BLAMED. Estonian defense authorites
have decided to station a local defense task force permanently
in the northeastern city of Narva by the end of the year. According
to Major Georg Ambach, commander of the local task force, a regiment
currently based on the coast at Narva-Joesuu will be transferred
to Narva."I understand that for many in Narva we are unwelcome,"
Ambach told BNS on 20 August. "This attitude is also shaped by
the Russian-language press in Estonia," Ambach said. The local
defense task force is a division of the Estonian Defense Ministry.
(Riina Kionka)

WAGES, PRICES INCREASE IN LITHUANIA. The average monthly salary
in Lithuania increased by 7% to 6,175 rubles in July, whereas
prices increased on the average of 27%, BNS reported on 20 August.
(Riina Kionka)

ROMANIA'S NSF OPPOSES THE RUSSIAN PREMIER'S VISIT. On 20 August
Romania's National Salvation Front (NSF), a partner in the country's
ruling coalition, expressed concern over a possible visit by
Russian acting Prime Minister Egor Gaidar. Western agencies reported
that Caius Traian Dragomir, the NSF's presidential candidate,
criticized Romanian Prime Minister Theodor Stolojan for having
failed to consult with the parties in the government coalition
before inviting Gaidar. According to Dragomir, Gaidar's visit
should not come before the presidential and general elections
set for 27 September, since "it might influence the electoral
campaign." (Dan Ionescu)

STOLOJAN ON ECONOMIC REFORMS IN ROMANIA. In an interview with
Radio Bucharest on 20 August, Prime Minister Theodor Stolojan
insisted that Romania achieved "particularly good results" in
its transition to a market economy. "In an extremely short period,
of only two and a half years," Stolojan said, "we succeeded in
creating most of the institutions and mechanisms of the market
economy in Romania." At the same time, however, Stolojan admitted
that Romania's economy was still far from that minimal degree
of stability which could render it attractive for both foreign
and local investors. (Dan Ionescu)

BULGARIAN MILITARY OFFICERS. According to a report in Demokratsiya
on 20 August, the Military Council of the Bulgarian General Staff
has proposed that eleven generals and 1,205 officers be relieved
of their duties. Meanwhile, in an interview published in Balgarska
armiya on the same day, Chief of the General Staff Colonel General
Lyuben Petrov conceded that the military profession tended to
be less attractive than previouslysignificantly fewer seek higher
military educationalthough he attributed this to the unclear
legal status of Bulgarian officers. (Kjell Engelbrekt)