No. 149, 8 August 1994

                              RUSSIA

SITUATION IN CHECHNYA. Three Chechen security officers were killed
in a clash on 6 August between troops loyal to President Dzhokhar
Dudaev and the opposition in the opposition-controlled
Nadterechnyi region of Chechnya, Interfax reported on 7 August. A
Chechen opposition spokesman in Moscow said the number of security
officers killed was in fact higher. Dudaev's government responded
by warning armed opposition groups of "tough actions" if they do
not surrender their arms. On 7 August, Chechen Parliament chairman
Ahyad Idigov issued a statement urging Chechens "to prevent a
political split in society" that, he said, could cause Chechnya
"to lose its sovereignty, and lead to war in the Caucasus." Idigov
blamed Moscow, which supports the opposition forces in Chechnya,
for rising tensions in the break-away republic. He claimed that
the situation in Chechnya was "on the whole controlled" by Dudaev.
Meanwhile, on 6 August, a spokesman for the Russian Interior
Ministry's Criminal Investigation Department told Interfax that
criminals were hiding from Russian justice in Chechnya.  Vera
Tolz, RFE/RL, Inc.

MOSCOW CAUTIOUS ABOUT AIRSTRIKES AGAINST BOSNIAN SERB TARGETS. On
5 and 6 August, Russian news agencies reported on official Moscow
reactions to the NATO air attacks of 5 August against Bosnian Serb
targets around Sarajevo, conducted in response to the Bosnian
Serbs' seizure of UN-supervised heavy artillery. According to
ITAR-TASS on 5 August, initial reaction was far from
overwhelmingly supportive, with an official foreign ministry
statement dubbing the NATO airstrikes "an outburst" and describing
them as a potential setback to the peace process in Bosnia and
Herzegovina. By the following day, ITAR-TASS reported that foreign
ministry officials did concede, however, that the Bosnian Serbs
themselves had "give[n] grounds" for the airstrikes.  Stan
Markotich, RFE/RL, Inc.

MMM SHAREHOLDERS DECLARE HUNGER STRIKE. The hot summer weekend of
6 and 7 August, according to the Russian TV newscast, "Vesti," was
used by shareholders of the pyramid investment fund, MMM, to
organize meetings and pickets to protest the government crack-down
on MMM. The shareholders demand compensation for the price of
their shares on 28 July--the day of the governmental announcement
of the MMM scheme status. Some shareholders even went so far as to
start a hunger strike on 7 August to add force to their demands.
The government responded by confiscating billions of rubles in
cash from MMM, which appears rather illogical, given that the
charges filed against the MMM president, Sergei Mavrodi,
ostensibly have nothing to do with MMM but with another firm of
his. "Vesti" cited the MMM shareholders as terming the scandal as
"yet another robbery [of law-abiding Russian citizens] by the
state." Julia Wishnevsky, RFE/RL, Inc.

VIOLENCE IN VLADIVOSTOK CONTINUES. The Ostankino Television weekly
review of Sunday 7 August aired an unusually large report
depicting the systematic harassment by the authorities of
Primorsky Krai in the Russian Far East of supporters of the
democratically-elected mayor of Vladivostok, Viktor Cherepkov.
(Cherepkov was removed from his office in March by Evgenii
Nazdratenko, who had not been elected but appointed the governor
of Primorsky Krai by Yeltsin.) According to the TV report,
opponents of Nazdratenko, in particular local journalists, have
been kidnapped, tortured and beaten up. As a result, as many as
twelve local editors, the Sunday anchor revealed, had asked for
political asylum in the US. Furthermore, the former mayor
Cherepkov was abducted, beaten up and strangled almost to death
with a plastic bag. Cherepkov's deputy, Vladimir Gildenberg, who
had been reinstated to the post by a court, was not allowed to
enter his office but was instead beaten up by police guards and
was hospitalized with concussion.  Julia Wishnevsky, RFE/RL, Inc.

SIT-IN STRIKE AT RUSSIAN NUCLEAR POWER STATIONS. Workers and
engineers at Russian nuclear power stations, who have not been
paid their wages for months, have announced a "wild' strike,
Ostankino television reported on 6 August. After the daily shift
the operators of nuclear power stations in Smolensk and the Kola
peninsula refused to leave their work places until they receive
their wages and customers pay their electricity bills. The nuclear
operators chose the "sit-in" form of protest because normal
strikes are forbidden in the nuclear industry. According to
Ostankino television, workers at at least seven other nuclear
stations support their colleagues in Smolensk and have likewise
organized "sit-in" strikes. The Minister for Atomic Energy, Viktor
Mikhailov said that he will fly to Smolensk to solve the problem
of non-payment of wages and to prevent chaos in the Russian
nuclear power station network Victor Yasmann, RFE/RL, Inc.

CHINA TO STEP UP PURCHASES OF RUSSIAN MILITARY HARDWARE? The
latest edition of the Hong Kong-based monthly magazine Mirror says
that China intends to buy some $5 billion worth of Russian
military hardware and technology as part of a broader plan to
streamline its armed forces, AFP reported on 4 August. According
to the magazine, China's State Council has already approved a plan
to import Russian jet fighters, production facilities for battle
tanks, and anti-missile systems. The AFP report provided no other
details of the planned acquisitions, nor did it specify the number
of years over which they would be spread. The $5 billion figure,
if true, would nevertheless be significant; estimates of the value
of Russia's total arms exports in 1993, for example, have
generally been in the area of $2 billion.  Stephen Foye, RFE/RL,
Inc.

LATEST ON RUSSIAN-SOUTH KOREA ARMS FOR DEBT PROPOSAL. ITAR-TASS,
quoting the YONHAP news agency, reported on 5 August that Seoul
has agreed to accept Russian arms as partial repayment for debts
owed to South Korea, but the same source suggested that the deal
would involve less than half of Russia's total debt, which is
estimated at approximately $1.4 billion. Negotiations on resolving
the debt problem were said to be continuing. South Korea has been
reticent to purchase Russian military hardware because it is
incompatible with the Western systems that currently comprise the
bulk of South Korea's armaments. There have been reports, however,
that because rival North Korea has long been supplied by Moscow,
Seoul is interested in acquiring some Russian armaments in order
study their capabilities. YONHAP reported that MiG-29 aircraft and
S-300 air defense missile systems were among the possible
acquisitions being discussed.  Stephen Foye, RFE/RL, Inc.

PACIFIC FLEET COMMANDER NAMED. Vice Admiral Igor Khmelnov, 49
years old, has been appointed commander of Russia's troubled
Pacific Fleet, Interfax reported on 5 August. Khmelnov has been
serving as acting fleet commander since the dismissal in May of
Admiral Georgii Gurinov. A number of reports have suggested that
Gurinov was a popular and effective commander and that his
dismissal, ostensibly for mismanagement of the fleet, may in fact
have been politically motivated.  Stephen Foye, RFE/RL, Inc.

                               CIS

LEBED IMPLIES YELTSIN RESPONSIBLE FOR HIS REMOVAL. In a brief
interview in Izvestiya of 5 August, Lt.-General Aleksandr Lebed,
who has apparently been forced out of the command of Russia's 14th
Army in connection with its restructuring, indirectly blamed his
removal on Yeltsin and his circle. "One sees an analogy here. When
they were unable to get rid of Gorbachev, they pulled the country
[USSR] from under him. From under me they pulled the army." Lebed
has a long record of making inflammatory statements with impunity,
most recently terming Yeltsin (along with several other top
politicians) "a minus", and signalling his intention to run for
President of Russia. An accompanying commentary in the same
newspaper, terming Lebed "a personality carrying a certain weight
in Russia's political life" and "a very authoritative figure to
Russian public opinion," concludes that it may have been "a
serious mistake by the President and his entourage" to make a
political martyr out of Lebed.  Vladimir Socor, RFE/RL, Inc.

                  TRANSCAUCASIA AND CENTRAL ASIA

CENTRAL ASIANS DISCUSS INTEGRATION. The prime ministers of
Kazakhstan, Kyrgyzstan and Uzbekistan met on 5 August to discuss
the further integration of the economies of the three countries
under the Economic Union set up in January, ITAR-TASS reported.
Kazakhstan's Prime Minister Sergei Tereshchenko was quoted as
telling journalists that he and his colleagues had confirmed an
earlier decision to create a Central Asian Bank and had named a
president for it. An interstate council is to coordinate the work
of economic departments in the three countries. Tereshchenko's
colleague from Uzbekistan, Abdulhashim Mutalov, noted the need to
bring laws on economic matters in the three countries in line with
each other.  Bess Brown, RFE/RL, Inc.

NOMINATIONS FOR TAJIK PRESIDENTIAL ELECTION. Tajik and Russian
news agencies reported on 6 and 7 August that two candidates have
been nominated for the post of president of Tajikistan. The
election is to be held on 25 September--the same day as a
referendum to give popular confirmation to a parliamentary
decision to restore the presidency, abolished at the end of 1992.
The first candidate to be nominated was Imomali Rakhmonov,
parliament chairman and Tajikistan's present head of state, who
was nominated by the Union of Youth (descendant of the Komsomol)
and the council of Khatlon Oblast (Rakhmonov is a native of
Khatlon). Former Prime Minister Abdumalik Adullodzhonov was
nominated by the council of his native Leninabad Oblast.  Bess
Brown, RFE/RL, Inc.

BAKU OIL WORKERS CALL OFF STRIKE. Workers at two Baku oil
enterprises have suspended their protest strike until 11 August
following a commitment by Prime Minister Suret Huseinov to meet
their demands, including the payment of back wages, according to
Interfax of 5 August. Meeting on 4 August, the Azerbaijan Cabinet
of Ministers instructed district executive committees in Baku to
supply the oil workers with foodstuffs on credit.  Liz Fuller,
RFE/RL, Inc.

                    CENTRAL AND EASTERN EUROPE

NATO PLANES STRIKE SERB TARGET. International media reported on 6
August that NATO aircraft the previous night hit an isolated
Bosnian Serb position away from civilians. The move was prompted
by the Serbs' removal of five heavy weapons from UN supervision,
which followed a series of what US Secretary of State Warren
Christopher had called "provocations." These included moving heavy
weapons in and out of exclusion zones and launching sniper attacks
in Sarajevo. Following the air strike the Serbs quickly returned
the weapons. The UN has also begun counterattacks against the
snipers, who had put the restored Sarajevo trams out of operation.
Patrick Moore, RFE/RL, Inc.

MILOSEVIC BACKED BY DOMESTIC MEDIA. On 7 August Reuters reported
that Serbian President Slobodan Milosevic's recent public break
with the Bosnian Serb leadership is being supported by a concerted
media campaign, which is evidently being used to depict the
controversial Serbian president as a sincere man of peace and to
recast his apparent main rival, Bosnian Serb leader Radovan
Karadzic, as the source of all problems in Bosnia and Herzegovina.
Serbian state media, under Milosevic's control, have had a history
of backing Karadzic's policies and actions, but recently have
swung firmly behind Milosevic's seeming peace efforts in what
appears to be a bid to garner public backing for Milosevic's new
policy. The state news agency Tanjug, for instance, has endorsed
Milosevic's breaking of political and economic ties with the
Bosnian Serbs by observing that such a move was made necessary by
Karadzic's "inconsistent and frivolous" leadership. In related
news, on 8 August The Los Angeles Times observes that Belgrade has
interfered with Bosnian Serb media access, noting "The relay of
[television] broadcasts from Pale, the Bosnian Serb stronghold . .
. [has been] stopped." Stan Markotich, RFE/RL, Inc.

KARADZIC ORDERS MOBILIZATION. News agencies on 6 August quoted
Bosnian Serb leader Radovan Karadzic as saying that he cannot
understand Serbian President Slobodan Milosevic's decision to
close their common border. Announcing that "only God is with us,"
Karadzic launched plans for a total mobilization of the Bosnian
Serb population, while his government is expected to be
reorganized shortly. The BBC said on 7 August that Milosevic
intends "to bring Karadzic to his knees," and noted that Serbian
electronic media have avoided mentioning the increased hardship
the Bosnian Serbs now face as a result of Milosevic's decision.
Milosevic's blockade has also affected the so-called Krajina
region of Croatia under Serb occupation. Borba on 5 August
reported strong backing from Krajina for Karadzic.  Patrick Moore,
RFE/RL, Inc.

SERBIAN DEVELOPMENTS PROMPT MUCH DISCUSSION. The BBC on 6 August
interviewed British Balkan expert Misha Glenny. He said that
Milosevic and Karadzic are locked in a political "power struggle
to the death" that includes an economic war "of two mafias" as
well as an ideological battle for "the hearts and minds of all
Serbs." Glenny noted that Milosevic already has the media and
police under his firm control, but suggested that the rump
Yugoslav army could play a decisive role in a power struggle. On 8
August the Los Angeles Times reported that Milosevic wants to
replace Karadzic with the equally nationalistic but apparently
more pliant Banja Luka Serb leadership. That group is noted for
its particular zeal not only in "ethnic cleansing," but also in
destroying mosques and other physical traces of the Ottoman or
Muslim presence. On 8 August Borba publishes a list of mosques
destroyed in that area. Finally, Bosnian President Alija
Izetbegovic was quoted by news agencies on 7 August as saying that
Milosevic started the war and armed Karadzic, and must now disarm
him if he wants to be taken seriously as a man of peace.  Patrick
Moore, RFE/RL, Inc.

BERISHA CALLS FOR MORE AIR STRIKES. Reuters on 6 August quotes
Albanian President Sali Berisha as urging more attacks on Bosnian
Serb targets. A spokesman said that "the president thinks more
serious air strikes by NATO, not just small sorties, would quickly
convince the Bosnian Serbs to accept the peace plan." Berisha also
seconded some other calls for international monitors to be placed
on the border between Milosevic's and Karadzic's forces. Elsewhere
in Tirana, RFE/RL's South Slavic Language Service on 7 August said
that more than 2,500 former political prisoners went into a third
day of a hunger strike despite a court order forbidding it. They
want increased compensation for damages they suffered under
communism. The ex-prisoners were recently promised some new
apartments, but they also want $60 million in privatization bonds
and $30,000 in direct payments to families or heirs. Reuters says
that some 120,000 out of 3 million Albanians suffered political
persecution under Enver Hoxha and his successor Ramiz Alija.
Patrick Moore, RFE/RL, Inc.

SLOVAKIA, HUNGARY "NORMALIZE" BILATERAL RELATIONS . . . On 5
August Hungarian Prime Minister Gyula Horn paid a one-day visit to
Slovakia, where discussions with Slovak officials focused on ways
to "win mutual trust and eliminate tensions" between the two
neighboring countries, TASR reported. Three agreements were signed
during the visit, including the elimination of visa requirements
and double taxation, as well as a readmission agreement, which
allows each country to send back aliens who illegally cross the
common border. Reuters reported that Horn and his Slovak
counterpart Jozef Moravcik verbally agreed to open three new
border crossings in an effort to promote bilateral trade, although
only one is set to open this year because of a lack of funds.
Sharon Fisher, RFE/RL, Inc.

. . . BUT PROBLEMS STILL REMAIN. A bilateral treaty, which deals
with the irreversibility of the Slovak-Hungarian border, the
establishment of a common bank and the rights of ethnic
minorities, has already been drafted but has not yet been signed,
largely because of differences of opinion on the issue of minority
rights, particularly concerning individual versus collective
rights. While Horn was asking for recognition of collective
minority rights, Moravcik gives priority to individual rights. In
an interview published in Sme on 5 August, Slovak Foreign Minister
Eduard Kukan said the agreement is unlikely to be signed before
the upcoming Slovak elections, scheduled for 30 September and 1
October. Slovak-Hungarian discussions also focused on temporary
solutions to the Gabcikovo-Nagymaros dam controversy, although
both sides agreed to leave the final decision up to the
International Court. Although Slovak President Michal Kovac told
CTK on 5 August that Horn had apologized for all wrongs of the
past towards minorities living in Hungary, Hungarian government
spokeswoman Evelyn Forro later refuted the report, saying that
Horn had said it would be "very good if the Hungarian minority
living in Slovakia receive an apology for the Benes decrees,"
Radio Budapest reported on 6 August. Horn expressed concern that
the Slovak election campaign might have a negative impact on
bilateral relations; the Slovak National Party has already
protested against the signing of a bilateral treaty.  Sharon
Fisher, RFE/RL, Inc.

PRE-ELECTION CONFLICTS IN SLOVAKIA. On 5 August the Slovak
National Party claimed it found that between 20 and 33% of the
more than 14,000 signatures on the petition list of the Democratic
Union were invalid and said it would ask the statistical bureau to
check the list. The SNP noted that if 20-30% of the signatures
collected are proven invalid, the party would fight to ban the DU
from running in the upcoming elections. In response to the attacks
by the SNP, the DU announced on 6 August that the Bratislava
electoral commission, which consists of representatives of 16
contesting political parties, has examined the petitions and
confirmed that the DU meets all legal requirements to run in the
elections. According to the election law, all parties, with the
exception of those represented in the parliament 60 days before
the elections or those which obtained at least 10,000 votes in
previous elections, were required to show that they have at least
10,000 members or to present a petition list including the
signatures of at least 10,000 eligible voters. In related news,
the West Slovakia electoral commission did not accept the argument
of the Democratic Party that it had obtained over 10,000 votes in
the last elections, since at that time it was in coalition with
the Czech Civic Democratic Party, and said the party cannot run in
that district. The DP has protested the decision, Sme reported on
5 August.  Sharon Fisher, RFE/RL, Inc.

MOBS THREATEN POLISH BUSINESS. Virtually all restaurants, cafes,
pubs, and shops in Warsaw's Old Town district were closed for
business on 6-8 August, as owners staged a protest against demands
from armed gangsters for "protection" money, PAP reports. In a
show of force on 29 July, a group of 25 thugs had visited Old Town
restaurants and reinforced their offers of protection (for
$500-$3000 per month) by demolishing furniture and threatening
guests. Early press reports suggested that owners were too afraid
of retaliation to cooperate with police. Major newspapers took up
the story on 4 August, however, apparently emboldening the
business community to stage a weekend "strike" in the Old Town.
The protest was also designed to force the police to take action,
as officials had initially refused to open investigations until
specific complaints were filed. After much public outcry and a
formal appeal from the ombudsman, this stance was reversed. A
first arrest was made on 6 August, after a revolver-wielding
mobster demanded money from a Warsaw pub. Prosecutors hailed this
as a breakthrough, as patrons agreed to testify. A reporter for
Gazeta Wyborcza also noted that police had detained the chief of a
"security agency" believed to be behind many of the protection
demands.  Louisa Vinton, RFE/RL, Inc.

IMF APPROVES STANDBY CREDIT FOR POLAND. The International Monetary
Fund gave formal approval to its latest standby arrangement with
Poland on 5 August, PAP reports. The draft agreement was signed in
June. Under the terms of the agreement, which runs until the end
of 1995, Poland is to receive $791 million in loans, to be paid
out in quarterly installments. The funds are to be used to bolster
Poland's balance of payments and to finance the reduction of the
country's commercial debt. In a statement issued on the occasion,
the IMF said that Poland's economic prospects are "generally
positive," with 5% annual growth feasible in the second half of
the current decade. The statement noted, however, that the burden
of payments to the Paris Club of government creditors will soon
increase, significantly narrowing the government's room for
maneuver.  Louisa Vinton, RFE/RL, Inc.

OPINION POLL: POLES ARE "SELECTIVE" CATHOLICS. Reviewing a recent
poll on religious practices, the Catholic daily Slowo observed on
8 August that the problem reflected by Polish religious behavior
"is not a crisis of religious practice but rather of 'selective
faith,' or the acceptance of only certain of the Church's
teachings." In a poll conducted by Demoskop on 15-19 July, 96% of
the respondents described themselves as "practicing Catholics,"
while only 4% said they never go to church. Of those who do
attend, 50% said they are "regular" church-goers, 37% said they
attend "occasionally," and 9% said they go to church only once or
twice each year. Yet 49% of the respondents said they think the
Church should permit abortion (42% opposed the idea), and 53%
believe the Church should allow divorce (41% were opposed). In
further results reported by Rzeczpospolita on 8 August, a full 60%
said they believe that the Catholic Church has too much influence
on Polish political life, while only 5% think it has too little
influence. Louisa Vinton, RFE/RL, Inc.

BULGARIAN ECONOMIC NEWS. On 5 August Bulgaria's Tron and Siemens
of Germany agreed to build a cellular telephone system which will
significantly improve radio and TV signals in many parts of the
country. Sofia and Plovidiv are the first cities to be covered by
the system, which is a precondition for the functioning of mobile
telephones. In another development, the Bulgarian National Bank
announced it has decided to lower the prime interest rate from 51%
to 48%. The measure, which was accompanied by a liberalized regime
on the BNB's trade with government securities, is in force as of 8
August. BTA carried the reports.  Kjell Engelbrekt, RFE/RL, Inc.

ROMANIAN COAL MINERS' STRIKE ENDS. A nine-day coal miners' strike
in the Rovinari region ended on 5 August after the government
agreed to a 35% pay rise, Romanian and international media
reported. Earlier, the government had agreed to other demands,
including the dismissal of the mining company's director general.
Miners' union leader Marin Condescu said the average monthly
miners' income will now be 300,000 lei (about $180). He also said
the miners will work in the next two weeks to replace the output
lost during the strike. The hunger striking miners ended their
strike after the agreement was signed with Industry Minister
Dumitru Popescu, Condescu said. The other labor conflict involving
miners, concerning copper miners in the Deva region, also seems to
be approaching a solution. A leader of the miners' union told
Radio Bucharest on 5 August that the government had offered a 26%
rise (the miners are asking for 50%) and that negotiations with
Popescu will start again on 9 August. Meanwhile, the copper miners
decided to suspend the underground sit-in protests, and those who
were on a hunger strike interrupted their fast.  Michael Shafir,
RFE/RL, Inc.

US AMBASSADOR URGES TRANSDNIESTER TO ACCEPT MOLDOVA. In her first
interview ever with the mass media in Transdniester, published in
Dnestrovskaia Pravda on 6 August, the US Ambassador to Moldova,
Mary Pendleton, said that Transdniester "is an inseparable part of
Moldova." "I wish that residents of the region understood the fact
that, under international law, Transdniester can not receive the
status of a state in a confederation [with Moldova], as certain
leaders in Tiraspol insist," Pendleton said. She remarked that
Transdniester does not need "statehood," but rather a share of the
benefits of Moldova's economic and political reforms, which enjoy
Western support. At the same time, the US supports the rights of
all inhabitants of Transdniester, including their right to their
own languages and cultures. Pendleton said, as cited by Basapress.
Vladimir Socor, RFE/RL, Inc.

FOUR NEW CABINET MEMBERS APPOINTED IN BELARUS. The chief of staff
of Belarus's administration, Leanid Sinitsyn, announced that four
more cabinet posts have been filled, Belarusian television
reported on 4 August. Volha Darhel was appointed minister for
social security; Barys Batura will continue holding the post of
housing minister; Alyaksandr Lukashou will be the new minister of
transport; and Vasil Lyavonau will be the new agricultural
minister. It is anticipated that Dzmitryi Bulakhau will head the
president's council and Viktar Sheiman will head the council on
national security.  Ustina Markus, RFE/RL, Inc.

BABURIN CRITICIZED OVER CRIMEA STATEMENT. The opposition in
Crimea's parliament, the "Crimea with Ukraine" committee of the
People's Council of Crimea, has appealed to the Ukrainian
parliament and general prosecutor to brand Russian deputy, Sergei
Baburin, persona non grata in Ukraine, Ukrainian television
reported on 4 August. Baburin had visited the Crimean parliament
on 29 July, at which time he said that Crimea is viewed as a part
of Russia. The People's Council of Crimea says such statements by
foreign officials are an interference in the internal affairs of
Ukraine.  Ustina Markus, RFE/RL, Inc.

THIRD SPECIAL SERVICE CREATED IN CRIMEA. Crimean President Yurii
Meshkov has created a Service of the President of the Republic of
Crimea for Security and International Affairs, UNIAN reported on 4
August. The new service is staffed by 39 personnel and is
responsible only to Meshkov. It is reportedly headed by Volodymyr
Bortnykov, who had previously worked in Russian special services.
Although the service was formed on 18 July, its existence has
become public only now. The two other special services in Crimea
are the security service responsible to Ukraine, which is headed
by Gen. Ivan Kolomytsev, and the Crimean security service, headed
by Gen. Volodymyr Lyepykhov.  Ustina Markus, RFE/RL, Inc.

RUSSIA BEGINS MARKING DISPUTED BORDER WITH ESTONIA. On 5 August
Viktor Zvonkov, deputy chief administrator of the Pskov Oblast,
told ITAR-TASS that work began that day on marking out the 466
kilometer border with Estonia. On 21 June Russian President Boris
Yeltsin had issued a decree ordering a unilateral border
demarcation, based on the boundaries existing in August 1991, when
Russia recognized Estonia's independence. Estonia claims that the
border should be determined by the Tartu Treaty of 1920. The
border question was not mentioned in the 26 July agreement on
Russian troop withdrawal from Estonia. Zvonkov noted that
preparatory typographical studies for draining marshes and
clearing forests in the border zone were under way and that
approximately one thousand iron and cement posts will be erected
by 31 December 1994.  Saulius Girnius, RFE/RL, Inc.

JULY INFLATION IN ESTONIA AND LITHUANIA. The Estonian Statistics
Department announced that the consumer price index rose (CPI) by
2.8% in July, BNS reported on 5 August. The largest increase was
for housing expenditures (10.9%), followed by housekeeping (2.6%)
and various goods and services (2.3%). Prices for fruits and
vegetables, however, fell by 6.2%, while prices of dairy products
and eggs dropped by 2.3%. In comparison with July 1993, the CPI
increased by 50.1%. On 8 August the head of the Lithuanian
Statistics Department, Kestutis Zaborskas, told Radio Lithuania
that the CPI had increased by 2.1% in July, the same rate as in
June. The greatest increase was for fuel and energy, which rose by
12.5%, while food prices increased by only 0.1%. He expressed
satisfaction that health care costs, which rose by 43% in the
first half of the year, grew by only 2.8% in July.  Saulius
Girnius, RFE/RL, Inc.

  [As of 1200 CET]
  Compiled by Liz Fuller and Sharon Fisher

RFE/RL RESEARCH INSTITUTE TO CLOSE; NEW INSTITUTE FOUNDED

The RFE/RL Research Institute will close at the end of 1994. A new
research institute, to be based in Prague in the Czech Republic,
will begin operations in October 1994.

This new research organization, the Open Media Research Institute
(OMRI), is the result of a unique initiative involving the United
States Board for International Broadcasting (Radio Free
Europe/Radio Liberty's government oversight and funding agency)
and the Open Society Institute (a Soros Foundation). It will
publish a weekly analytic journal and a daily digest of events in
the former Soviet Union, Eastern Europe, and selected other
countries; provide current analyses and information to RFE/RL
broadcasters and others; and undertake, as custodian, the
preservation and automation of the RFE/RL archives to make them
more accessible to the scholarly community. It will engage in
training and other activities in support of democracy and
independent media throughout Eastern Europe and the territory of
the former Soviet Union.

The closure of the RFE/RL Research Institute is part of the
reordering of American national priorities after the end of the
Cold War. It is a result of the United States International
Broadcasting Act of 1994, which mandated a consolidation of all
US-funded international broadcasting activities, a drastic
reduction in the RFE/RL budget, and the privatization of some
RFE/RL operations, including those of the Research Institute.

In response to the new law, the Board for International
Broadcasting and the Board of Directors of RFE/RL Inc. directed
the closure of the Research Institute by 31 December 1994. The
institute's weekly RFE/RL Research Report and the RFE/RL Research
Bulletin will cease to be published at the end of August 1994.
RFE/RL intends to continue publication of the RFE/RL Daily Report
until such time as OMRI can begin its daily digest.

The RFE/RL Research Institute was established in late 1990,
incorporating and building on the operations of several RFE and RL
research units. The institute's publications have included the
RFE/RL Research Report, the RFE/RL Research Bulletin, the RFE/RL
Daily Report, and the RFE/RL Research Studies series. In addition,
the institute has issued monitoring bulletins of Eastern
broadcasts and the press. It has conducted opinion and audience
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Kevin Klose, President, RFE/RL Inc. A. Ross Johnson, Director,
RFE/RL Research Institute

  1 August 1994
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