Как басня, так и жизнь ценится не за длину, но за содержание. - Сенека

Vol. 1, No. 12, 17 January 1995

We welcome you to the Open Media Research Institute's Daily Digest--a
compilation of news
concerning the former Soviet Union and East-Central and Southeastern Europe.
The Daily
Digest picks up where the RFE/RL Daily Report, which recently ceased
publication, left off.
Contributors include OMRI's 30-member staff of analysts, plus selected
freelance specialists.
OMRI is a unique public-private venture between the Open Society Institute
and the U.S. Board
for International Broadcasting.


BATTLE FOR GROZNY CONTINUES. The Russian government press service
characterized the situation in Grozny on 16 January as "tense," with Chechen
forces continuing fierce resistance to Russian troops attempting to advance
on the presidential palace. Western agencies cited unconfirmed claims by
Chechen officials that Chechen fighters had succeeded in retaking some
ground. Chechen forces were also said to be re-entrenching and concentrating
artillery and armored vehicles along the Chelmuga-Bamut-Arshty road
southwest of Grozny and at other locations in the south. Speaking at a press
conference in Moscow on 16 January, a senior Russian Foreign Ministry
official stated that at present Moscow considers the dispatch to Chechnya of
an OSCE representative to be premature, although he did not exclude OSCE
involvement in a settlement of the conflict at some future stage, Interfax
reported. He also
conceded that developments in Chechnya could delay Russia's admission to the
Council of Europe. -- Liz Fuller, OMRI, Inc.

Viktor Chernomyrdin proposed a cease-fire and immediate negotiations with
separatists, subject to strict conditions, AFP reported. Chernomyrdin
offered to hold talks on freezing troop deployments in Chechnya, calling off
the use of tanks, artillery and other heavy weapons, and setting up
no-fighting zones where weapons could be stockpiled, but stipulated that
peace could only come after the Chechens had laid down their arms, something
they have so far refused to do. Chernomyrdin also called for talks on
Chechnya's future with a view to setting up a transitional government.
However, the negotiators face the difficult task of finding a leader
acceptable to both sides. Also on 16 January, a Chechen delegation headed by
Economy Minister Teimuraz Abubakarov with negotiating authority from
President Dzhokhar Dudaev
arrived in Moscow for talks with Chernomyrdin, AFP reported. -- Robert
Orttung, OMRI, Inc.

Geneva on 17-18 January, Russian Foreign Minister Andrei Kozyrev and US
Secretary of State Warren Christopher will discuss preparations for the May
Russian-American summit in Moscow, as proposed by Russian President Boris
Yeltsin, Interfax reported on 16 January, quoting a senior Russian Foreign
Ministry official. The US Administration has not yet responded to Yeltsin's
invitation. The official stressed that the Geneva meeting was not "on
Chechnya or for it," but that the issue would be discussed. "We do not deny
that the human rights aspect of this problem concerns not only Russia," he
underlined. Kozyrev and Christopher will also review understandings reached
by Yeltsin and US President Clinton last September, the expansion of NATO,
creating a new system for European security, and nuclear
non-proliferation. In a related development, Yeltsin has canceled his trip
to Davos at the end of January to address the participants of an
international economic forum there in light of events in Chechnya, Vremya
reported 16 January, quoting Yeltsin's aide for international affairs,
Dmitrii Ryurikov. -- Robert Orttung, OMRI, Inc.

Shaimiev expressed concern over the implications of a statement by Duma
Speaker Ivan Rybkin
on Tatarstan's autonomy within the Russian Federation, Interfax reported on
13 January. Rybkin had said on 9 January that "gangster groups on Russian
territory, no matter whether in Tatarstan, Bashkortostan, Volgograd,
Leningrad or Voronezh regions will be dealt with at this
time." Shaimiev interpreted this statement as signaling a crackdown on
Tatarstan, which has negotiated a bilateral treaty determining its status
within Russia. Shaimiev expressed regret that Rybkin did not understand
Tatarstan's role in building a genuinely democratic federation based on
harmony and respect between the peoples of Russia. Rybkin said he did not
intend to
single out Tatarstan in saying that people who violated the law would be
prosecuted and expressed the hope for "full understanding." -- Robert
Orttung, OMRI, Inc.

Minister Egor Gaidar, on a visit to Prague, said in an interview with Rude
Pravo on 17
January that President Boris Yeltsin has no chance of being re-elected. The
conflict in Chechnya has changed both Russia's international standing and
its domestic political situation, with the government and president now
receiving their most active support from radical nationalist parties and
being most strongly opposed by liberal groups, he said. Gaidar added,
however, that
Russia remains a democratic state. "We have a free press--for the time
being. Up to now, the elected organs of power are functioning and I believe
that this state of affairs can be preserved," he said. -- Steve Kettle,
OMRI, Inc.

YELTSIN TO LEAVE MEDIA ALONE. Sergei Filatov, the head of the presidential
staff, said that Yeltsin does not planany new initiatives to reorganize
Russian TV, Interfax reported 16 January. Filatov said that the December
decrees establishing the independent NTV and Ostankino had not yet been
fully implemented, and that Yeltsin had emphasized that it was time to give
the media a chance to work normally. Filatov said that the Chechen crisis
was a trial of "our ability to maintain democracy." He noted that some
observers accused journalists of twisting the facts in their reporting,
while others felt that the media had declared war on the government. In this
connection, he said that although there were calls to muzzle the press and
television, it must be
understood that such a policy would undermine trust in the new Russia.
Filatov called for tolerance in relation to the media. -- Robert Orttung,
OMRI, Inc.

FINANCE MINISTER JOINS SECURITY COUNCIL. President Yeltsin appointed Finance
Minister Vladimir Panskov to the Security Council, a presidential spokesman
told AFP on
16 January. Panskov, who has been in his current post for less than three
months, has asserted on several occasions in the past few weeks that the war
in Chechnya would not affect Russia's austerity budget. His estimates of the
costs have been lower than those of most other experts. The Council has been
the top decision-making body in the Chechen conflict. Yeltsin recently
appointed both parliamentary leaders to its ranks. -- Robert Orttung, OMRI, Inc.

Ministry official was quoted by Interfax on 16 January as saying that an
upcoming U.S. test of a
tactical anti-ballistic missile was a "very untimely step." American and
Russian negotiators have been trying for some time--without success--to
agree on the differences between tactical and strategic anti-ballistic
missile weapons so that testing of the former would not conflict with the
1972 Anti-Ballistic Missile (ABM) treaty. The official also complained that
the Americans officially notified Russia of the test only after the
information had been leaked to the American
press. -- Doug Clarke, OMRI, Inc.

VOROBYOV QUESTIONING CONFIRMED. General Alexei Ilyushenko, Russia's acting
prosecutor-general, told a press conference on 16 January that military
had interviewed Colonel-General Eduard Vorobyov in connection with the
latter's refusal to take command of the operations in Chechnya. According to
Interfax, Ilyushenko indicated other officers and servicemen were also being
investigated. He said that no criminal proceedings had yet been started,
adding that his office did not distinguish "between a private, a general, and a
deputy defense minister." Military sources told Interfax that Vorobyov could
not be prosecuted because he had only been offered the Chechnya post, not
ordered there.-- Doug Clarke, OMRI, Inc.

RUBLE FALLS 41 POINTS IN TRADING. The ruble continued to skid against the
dollar, falling 41 points and closing at 3,817 rubles to $1 in MICEX trading
on 16 January. Since 12 January, the ruble has fallen 60 points against the
US dollar. According to Interfax on 16 January, the difference between
demand and supply stood at $36 million. Dealers reported that the Russian
Bank sold about $55 million. Meanwhile Minister of Economics Yevgenii Yasin
told Interfax on 16 January that he does not envisage a repeat of "Black
Tuesday" ( 11 October, 1994), when the ruble crashed against the dollar.
Yasin said that the threat of another crash had been more real
a few months ago when prices were rising faster than the ruble. He said that
recently money supply has been growing far more slowly than prices, and if
this trend continues, inflationary fears will disappear in three to four
months. Yasin said that the ministry plans to continue with stringent
monetary policy and to stabilize the ruble as long as prices level off,
rather than prop
up the ruble by the Central Bank's currency interventions. -- Thomas Sigel,
OMRI, Inc.

INSOLVENT ENTERPRISES ON RISE. Over 1,200 Russian enterprises in which the
state holds over a 25% stake have been declared insolvent, Interfax reported
on 16 January. The Federal Insolvency Administration said that the total
debt of these enterprises, which have a work
force of 2 million, has reached nearly 11 trillion rubles  ($2.89 billion).
Most seriously affected are
energy producing industries and agriculture processing plants. According to
the report, the number of insolvent public enterprises is increasing: last
month Russia had 1,100 insolvent public enterprises, but today more than
4,500 are likely to be declared insolvent. The
Administration has already ordered 150 public enterprises to go into
receivership. In 1994 Russia's arbitration courts handled 102 insolvency
cases. --Thomas Sigel, OMRI, Inc.


SOME KAZAKH MINERS RESUME WORK. Miners at Kazakhstan's Ekibastuz coal field
returned to work on 15 January following government promises to pay back
wages through
last November, Interfax reported on 16 January. In Karaganda, however,
miners are continuing the strike begun on 13 January and holding out for
payment of wages from October, 1994. Kazakh Prime Minister Akezhan
Kazhegeldin held talks with coal ministry officials and
trade union leaders from both Ekibastuz and Karaganda on 16 January. -- Liz
Fuller, OMRI, Inc.

AKAEV CALLS FOR MEDIA SELF-CENSORSHIP. While stressing that he has no
intention of exerting pressure on the opposition press, Kyrgyz President
Askar Akaev has called upon the country's journalists to "tone down" their
writings, to refrain from expressing either extreme right-wing or extreme
left-wing views, and to be "balanced" in their criticism of the country's
leadership, according to Interfax of 16 January quoting presidential  press
service chief Kamil Bayalinov. Akaev rejected proposals for submitting a new
law on the media to parliament as an attempt to reinstate censorship,
arguing that the existing legislation "provides sufficient democratic
potential for the media." -- Liz Fuller, OMRI, Inc.


KAZAKH-RUSSIAN-OMAN PROTOCOL SIGNED. Caspian Pipeline Consortium members
Kazakhstan, Russia, and Oman have signed a protocol on the start of the
first stage of a
$1.2 billion project to lay a Caspian pipeline network, Interfax reported on
16 January. Oman and Kazakhstan each control 33% of the shares in the
project, and Russia--34%. On 12 January the Journal of Commerce reported
that the Russian government had issued a decree
nominating the Tengiz-Astrakhan-Grozny oil pipeline, which is currently out
of commission,  as Russia's contribution to the CPC. The pipeline has a
projected capacity of 62 million metric tons per year, or 452.6 million
barrels; transit costs will be $3.25 a barrel for CPC founders and $3.5 a
barrel for other users for deliveries of more than 750 kms. -- Liz Fuller,
OMRI, Inc.


CONFLICT AT TOP CONTINUES IN POLAND. During a half-hour meeting on 16
January described by a spokesman as "icy," President Lech Walesa repeatedly
expressed his concern
to Prime Minister Waldemar Pawlak that vacancies in the defense and foreign
ministries were promoting the "growing destabilization of the state," Radio
Warsaw reports. Pawlak disagreed. He acknowledged that the government has
"personnel problems" to overcome, but denied that consensus on foreign and
security policy is threatened. The president rejected the coalition's
latest candidate for defense minister, Longin Pastusiak, a political
scientist and expert on the US who had long represented the communist
establishment. Pastusiak's appointment, the spokesman said, would be a "slap
in the face" for one of Poland's closest allies. Meanwhile,
Deputy Foreign Minister Iwo Byczewski, who was expected to serve as acting
minister until a replacement for Andrzej Olechowski could be found,
announced his resignation on 16 January. Gazeta Wyborcza reports that at
least a dozen diplomats and several department heads
plan to leave the ministry as well. -- Louisa Vinton, OMRI, Inc.

of Poland's 10 largest right-wing parties agreed to support a common
candidate in the presidential election expected in November. No candidate
was chosen, however, and debate on a shared "minimum program" revealed deep
divisions over foreign policy priorities (including EU and NATO membership)
and possible election alliances. Most delegates ruled out any cooperation
with the largest parliamentary opposition party, the Freedom Union (UW),
effectively scuttling any chance for a united "post-Solidarity" front.
Solidarity leader Marian Krzaklewski urged "all
patriotic forces" to support the union's draft constitution, and hinted that
this was a precondition for Solidarity's endorsement in the elections. The
UW leadership on 15 January agreed to hold straw polls within the party
before choosing a candidate at an April congress, Rzeczpospolita reports.
The party's left wing supports former Labor Minister Jacek Kuron, while the
right wing backs former Prime Minister Hanna Suchocka. UW chairman Tadeusz
Mazowiecki ruled out his own candidacy. -- Louisa Vinton, OMRI, Inc.

ESTONIA'S PRE-ELECTION CAMPAIGN. The Pro-Patria and Estonian National
Independence Party Union at a conference on 15 January announced the top
dozen names on their election list, BNS reported on 16 January. It includes
eight Pro-Patria and four ENIP members headed by chairmen Mart Laar and
Tunne Kelam, respectively. The union will campaign under the slogan "Fire
Will Not Go Out," indicating their platform of continuing the current
reforms. The People's Party of Republicans and Conservatives, commonly known
as the Rightists, held a pre-election conference in Tallinn on 14 January at
which various speakers outlined the domestic, economic,
foreign, and defense policies the party's candidates will support if
elected. -- Saulius Girnius, OMRI, Inc.

died over the weekend at the age of 80, BNS reported on 16 January. He will
be buried on 18
January in the town of Taurage. -- Saulius Girnius, OMRI, Inc.

LUKASHENKA IN CHINA. Belarusian President Alyaksandr Lukashenka arrived in
China on 16 January for a three- day visit, Belarusian Radio reported.
Lukashenka is to meet with President Jiang Zemin, Prime Minister Li Peng and
other officials. During the visit, it is expected
that agreements on cooperation, air links and dual taxation will be signed.
The two sides will also discuss cooperation in education, science and
cultural affairs. Trade between China and Belarus stands at some $46 million
annually. -- Ustina Markus, OMRI, Inc.

Prosecutor General, Vasil Shaladonau, told reporters on 13 January that the
censorship imposed on newspapers in December violated citizens' rights to
information, Belarusian television reported. Following a sensational report
in parliament, which alleged that a number of officials in the president's
administration engaged in corrupt practices, the republic's newspapers
were banned from printing accounts of the session and several independent
newspapers were banned from publishing altogether. The censorship provoked
an outcry from the opposition and journalists and led to the resignation of
the head of the president's policy center, Alyaksandr Feduta. -- Ustina
Markus, OMRI, Inc.

16 January that Ukraine has appointed a new ambassador to Russia. Volodymyr
a Russian who was a deputy to the Ukrainian Supreme Soviet in 1990 and
served as a representative of the Ukrainian Cabinet of Ministers in Russia
from 1991 to 1992, was selected. -- Ustina Markus, OMRI, Inc.

Leonid Kuchma has severely criticized the organizers of a campaign,
currently gathering signatures for a petition to hold a referendum on the
creation of a new political, economic, and military union with Russia,
Belarus, and Kazakhstan, Interfax-Ukraine reported on 16 January. While
visiting a military unit in the Chernihiv region, Kuchma told reporters that
such a union would "do no one any good, including Ukraine," and warned
organizers that as recently elected president of an independent Ukraine he
would not allow anyone to "rock the boat we are in" and would do his utmost
to strengthen its independence. Leftist political forces, including the
Communist Party of Ukraine, have led the petition drive, mainly in the
russified regions in
eastern Ukraine, spurred on by similar movements in other former Soviet
republics still displeased with the dissolution of the old union. --
Chrystyna Lapychak, OMRI, Inc.

The emergency stoppage system in the first reactor of the Khmelnytsky
nuclear power station was activated early on 16 January after three main
circulating pumps were disconnected from the mains due to a failure of the
power supply of the transducers, the Ukrainian State Committee for Atomic
Energy told Interfax-Ukraine on the same day. Serhiy Nazarenko, an agency
official, said
there had been no increase in radiation levels at the plant, but the reasons
for the accident are under investigation. The reactor was scheduled shortly
to be shut down for repairs and maintenance of its control and safety
systems, he said. -- Chrystyna Lapychak, OMRI, Inc.

Meshkov told a rally in Simferopol on 15 January that the power struggle
between himself and the Crimean Parliament that stripped him of most of his
authority last autumn has left a dangerous power vacuum in the region that
has been exploited by local organized
crime groups, Interfax-Ukraine reported on 16 January. Meshkov promised
radical changes in the regional management system as well as tough measures
against organized crime, referring to a recent poll of Crimeans that
revealed some 58% of them believe the "mafia" is in charge in this
autonomous region of Ukraine. He blamed local law enforcement for "inaction"
against growing
crime and said the Crimean Parliament has disregarded the will of the people
by curbing the powers of their popularly-elected president. -- Chrystyna
Lapychak, OMRI, Inc.

CZECH GOVERNING PARTIES REMAIN AT ODDS. The leaders of the four parties in
the Czech governing coalition met on 16 January but remained divided over
whether the state counter-intelligence service BIS has been collecting
information illegally on political parties, Czech media report. Prime
Minister Vaclav Klaus said he was not convinced by the evidence presented by
Deputy Premier Jan Kalvoda, leader of the Civic Democratic Alliance. As
prime minister, Klaus is responsible for BIS, which is headed by a nominee
of his Civic Democratic Party. Kalvoda and other CDA leaders have said
confidential documents and the party's database of members went missing or
were stolen from a party official's car before last November's local
elections. Christian Democratic Union leader Josef Lux, another deputy
premier, also repeated charges that BIS has spied on his party. The party
leaders, increasingly at odds in recent months, refused to comment on the
tone of their meeting but agreed that a parliament commission should
investigate the accusations. Kalvoda and Lux later informed President Vaclav
Havel of their charges; Havel's spokesman said the president took the situation
seriously and found the two deputy premiers' concerns convincing. -- Steve
Kettle, OMRI, Inc.

16 January that the four Visegrad countries--the Czech Republic, Hungary,
Poland, and
Slovakia--have agreed to a Pentagon proposal for the establishment of a
unified air defense and air traffic control system. The radio said that the
Regional Airspace Initiative was approved by senior defense and transport
ministry officials from the four nations at a meeting in Trencin, Slovakia.
The Pentagon is said to have pledged up to $25 million to the project. -- Doug
Clarke, OMRI, Inc.

HUNGARY AND THE EUROPEAN UNION. During an official visit to Hungary on 16
January, EU President and French Minister for European Affairs Alain
Lamassoure said that
Hungary is the most prepared of the countries seeking full EU membership but
still needs to reform its economy substantially and establish good relations
with  Countries with Hungarian minorities, MTI reports. He offered France's
and the EU's help in resolving differences of opinion between Hungary and
its neighbors over the exercise of minority rights, an issue which has
delayed the signing of bilateral treaties with Slovakia and Romania.
Lamassoure reiterated that the EU will not accept members who cannot solve
their problems with their neighbors. -- Edith Oltay, OMRI, Inc.

Laszlo Lakos told a press conference on 16 January that after years of
decline Hungarian agriculture is on the way to recovery, MTI reports. He
noted that agricultural production increased
by 5%, exports by 15%, and producer prices rose by 30% compared to the same
period last year. Lakos said that the agricultural sector received 80
billion forint from the central budget in 1995 compared to 57 billion forint
in 1994, and that the increased subsidies will be used mainly to support
food exports and to supply agricultural machinery. -- Edith Oltay, OMRI, Inc.


MORE HEADACHES FOR THE UN IN BOSNIA. A number of developments continue to
undermine the shaky cease-fire that came into force at the start of the
year. First is further shelling of the Bihac area, about which one news
agency wrote on 15 January: "it was not clear which sides were fighting." A
second issue is the presence of what the ceasefire agreement calls "foreign
forces, " namely those of the Krajina Serbs and of the Croatian army. AFP on
16 January quotes UNPROFOR as calling for the Croatian military to leave
Bosnia and Herzegovina,
where they are active on the Livno and Kupres fronts with Bosnian Croat
forces. A third problem is the discovery by the UN of at least 50 Bosnian
government soldiers in three different places in Mt. Igman's demilitarized
zone, from which they were supposed to be gone. A fourth concern is the
continued Serb blockade of supply routes into Sarajevo, which they were
expected to reopen last weekend. Reuters on 17 January said that the Serbs
"sabotaged an accord... by demanding the roads be used only by eight foreign
relief agencies that do not
need them." -- Patrick Moore, OMRI, Inc.

authorities continue their intensive campaign to mobilize domestic support
for President Franjo Tudjman's decision to end UNPROFOR's mandate on 31
March, UN Secretary General Boutros Boutros-Ghali was quoted by news
agencies on 16 January as saying he hopes that Zagreb will change its mind
and let the peacekeepers stay. He expressed the fear that governments might
not only withdraw their forces from Croatia but from other parts of the
former Yugoslavia as
well. Boutros-Ghali also referred to the "practical and financial aspects"
of a UN pull-out. Tudjman offered to let the UN, whose presence means big
income for Croatia, keep its headquarters in Zagreb. Reuters wrote on 13
September, however, that a new location is under
consideration by the world body. "Among the choices are Sarajevo, which some
object to for safety reasons, or perhaps even the Slovenian capital of
Ljubljana." Boutros-Ghali also said on 16 January that he fears the Croatian
decision will lead to a renewal in the fighting. Similar concerns were
expressed by the rump Yugoslav Prime Minister Radoje Kontic, Tanjug said, and
by the Bosnian Serb news agency SRNA, which claimed that Zagreb is already
planning a new war. -- Patrick Moore, OMRI, Inc.

MONTENEGRO IN 1994, SERBIA TODAY. Independent Borba on 17 January reports on
economic conditions in Montenegro in 1994, suggesting that some indicators
were far from
positive. It said industrial production in the rump Yugoslav republic fell
by some 27.5% over 1993. Moreover, out of some 30 "industrial branches" only
11 reported increased output over the previous year. In other news,
independent Borba also continues its coverage of the plight of rump
Yugoslavia's independent media, chafing under Serbian President Slobodan
Milosevic's continuing efforts to silence them. Politika reports on 17
January that the independent weekly Vreme will go on sale in the rump
Yugoslavia again that same day, after being temporarily kept off the market
due to a newsprint shortage. -- Stan Markotich, OMRI, Inc.

government is offering interest-free credits for building houses or buying
flats to citizens of
Serbia who left Kosovo and want to return. The credits are valid for a
period of 40 years and are also offered to specialists who want to move to
Kosovo, the independent Borba reported on 17 January. The goal is to settle
about 100,000 ethnic Serbs and Montenegrins in the mainly ethnic Albanian
region, which has an estimated population of two million. -- Fabian Schmidt,
OMRI, Inc.

ILIESCU ON ROMANIA'S SECURITY. President Ion Iliescu and Defense Minister
Gheorghe Tinca on 16 January attended the opening ceremony of the new
academic year at the
National Defense College. In his address broadcast live by Radio Bucharest,
Iliescu praised Romania's progress towards European integration in 1994, a
year he described as "Romania's Euro-Atlantic year." He singled out former
Yugoslavia as a "major source of insecurity"
for Romania, and expressed concern over the situation in some regions of the
former Soviet Union, including the eastern part of the neighboring Republic
of Moldova. While not specifically mentioning the conflict in Chechnya,
Iliescu warned against the reemergence of
"imperial tendencies in Russia's policy" which, he said, could hamper the
restructuring of Europe's security system and have a direct impact on
Romania's security. The National Defense College is an institution training
army officers and security experts in post-graduate defense studies. -- Dan
Ionescu, OMRI, Inc.

has been sued for the first time by a child who contracted AIDS in hospital,
Rompres reported
on 15 January. The 10-year-old girl probably contracted the AIDS virus in
1991 when hospitalized in the town of Iasi. She was diagnosed as having AIDS
two years later. The hospital is also being sued, the agency says. According
to statistics published last September, Romania has 2,905 registered cases
of AIDS. The overwhelming majority (2,695) are children aged less
than 13 years. -- Dan Ionescu, OMRI, Inc.

MOLDOVA AND THE COUNCIL OF EUROPE. A Council of Europe delegation will
recommend that Moldova be admitted to the organization in the near future,
Interfax reported on 15 January. The delegation concluded a four-day visit
to Moldova aimed at assessing the country's compliance with council
standards, especially in the field of human rights and freedoms. Asked about
the possible influence of the conflict in the Dniestr region on Moldova's
application, Lord Finsberg, a member of the team, replied euphemistically
that the situation in the separatist region would be described as "a museum
of communism." Moldova is among several Soviet republics
expected to be admitted to the Strasbourg-based Council of Europe this year.
-- Dan Ionescu, OMRI, Inc.

the leaders of the parties represented in parliament on 16 January, Standart
reported the
following day. These political consultations took place according to the
constitution in order to find a candidate for the post of prime minister. On
17 January Zhelev will ask Socialist Party leader Zhan Videnov to form a
government, which must then be presented within seven days. The socialist
newspaper Duma reported on 17 January that the new cabinet will be presented
on 20 January. Most opposition parties' leaders said they will not support
the new government. -- Stefan Krause, OMRI, Inc.

is prepared to lower the prime interest rate in February, Trud and Standart
reported on 17 January, citing BNB officials. Trud stated that this is the
result of positive figures for January's
inflation. BNB executives fear, however, that there is a risk of declining
reserves in foreign currency if a new agreement with the International
Monetary Fund is not concluded soon. In this case the reserves might drop to
$200 million by the end of 1995. IMF officials will visit Sofia for
negotiations after the formation of a new government, Standart reported.
During their last
visit in November 1994 they insisted that Bulgaria should fight inflation
even at the price of fixing exchange rates, the article said. -- Stefan
Krause, OMRI, Inc.

[As of 1200 CET]

Compiled by Liz Fuller and Steve Kettle

The OMRI Daily Digest offers the latest news from the former Soviet Union
and East-Central
and Southeastern Europe. It is published Monday through Friday by the Open
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