No. 27, Part I, 7 February 1995

We welcome you to Part I of the Open Media Research Institute's Daily
Digest. The Digest is distriubed in two sections. This part focuses on
Russia, Transcaucasia and Central Asia, and the CIS. Part II,
distributed simultaneously as a second document, covers 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.

RUSSIA

"ARMY HAS FULFILLED ITS TASKS IN CHECHNYA" -- GRACHEV. Meeting with
military leaders in Moscow on 6 February, Russian Defense Minister Pavel
Grachev asserted that the army had fulfilled its task in Chechnya by
establishing control over the last remaining Chechen stronghold in
Grozny, Interfax reported. A military source in Mozdok told Interfax on
the same day that Russian troops had succeeded in blocking the main
roads into Grozny, thus preventing the transport of arms and supplies to
the remaining Chechen fighters. He also predicted the Russian military
would formally hand over the Chechen territory under its control to the
Russian Interior Ministry "within ten days." -- Liz Fuller, OMRI, Inc.

MORE DETAILS ABOUT THE DECISION TO INTERVENE IN CHECHNYA COME TO LIGHT.
The head of President Yeltsin's Analytical Center, Emil Pain, and a
consultant to the center, Arkady Popov, have published a report
describing the decision to intervene in Chechnya, Interfax reported on 7
February. The two experts claim they had presented a plan for the
peaceful resolution of the conflict which was ultimately rejected. The
plan proposed economic and social support for the three northern regions
of Chechnya, where the population had demonstrated sympathy for
remaining within the Russian Federation in September 1994. The goal was
to improve conditions in this part of Chechnya so that when elections
were held in the republic, residents would be able to make a clear
choice between staying within Russia or leaving it. The plan sought to
strengthen the position of Umar Avturkhanov, in his capacity as head of
the Nadterechny Regional Administration, and make public Moscow's
attempts to help the loyal regions. The advisers claim the Security
Council's power ministers rejected this plan because they did not want
to deal with "either the Chechen opposition or political partners
deserving respect and confidence." Much of the presidential apparatus
and many of Yeltsin's advisers were excluded from reviewing the military
plans for Chechnya. Deputy Prime Minister and then Minister for
Nationalities and Regional Policy Nikolai Egorov did not inform his
ministry's board of the secret plans. As a result, Deputy Minister for
Nationalities Vyacheslav Mikhailov, appointed head of the negotiating
delegation, went to Mozdok without knowing that the war would begin
before he could start his work. The experts said the media's critical
reaction drove the generals and politicians who supported the policy to
even more cruel actions. -- Robert Orttung, OMRI, Inc.

LUKIN FORESEES ECONOMIC SANCTIONS OVER CHECHNYA. Russia may become the
target of economic sanctions as a result of Chechnya, according to
Vladimir Lukin, chairman of the State Duma Committee on International
Affairs, Interfax reported on 6 February. He based his conclusion on the
Council of Europe's decision to defer consideration of Russia's
application for membership. -- Michael Mihalka, OMRI, Inc.

RUMORS OF GRACHEV'S REMOVAL EXAGGERATED? Defense Minister Pavel Grachev
will participate in Russia's official delegation to the CIS summit in
Almaty on 10 February, Interfax reported. According to a "high-ranking
military source speaking on condition of anonymity," the minister's
inclusion in the delegation "completely goes against the rumors of
Grachev's imminent removal, intentionally spread in Moscow." The source
said this trip is an indication of "normal relations between the
president and the defense minister." -- Robert Orttung, OMRI, Inc.

DRAFT ELECTORAL LAWS TO BE CONSIDERED IN MARCH. Responding to media
concern, Chairman of the Duma Committee for Legislation and Judicial
Reform, Vladimir Isakov told Interfax on 6 February, that draft laws for
electing the Duma and President, and holding referenda will be submitted
for their second reading in parliament no later than March. Isakov
confirmed reports that his committee and its counterpart in the
Federation Council are working on a law for elections to the council. --
Robert Orttung, OMRI, Inc.

REGIONAL LEADERS DENOUNCE PARTY LIST ELECTIONS, FEDERAL ENCROACHMENTS.
Regional interests are not represented in elections by party list,
Vladimir Medvedev, leader of the New Regional Policy parliamentary
group, said in a Duma debate, reported in Nezavisimaya gazeta on 7
February. All the parties fight for support in Moscow, he explained. He
advocated the election of Duma deputies from single-member districts as
the best solution. In the same discussion, St. Petersburg Mayor Anatolii
Sobchak complained that federal authorities were accumulating power at
the expense of the regions. In St. Petersburg there are now 64 federal
structures employing 11,000 individuals. Not one of them was set up with
the consent of local officials, as provided for in the constitution, he
claimed. -- Robert Orttung, OMRI, Inc.

RUTSKOI SPLITS SOCIAL DEMOCRATS. The board of the Russian Social
Democratic Party has ruled to expel its ex-leader, former Vice-President
Aleksandr Rutskoi, along with nine of his supporters, Interfax reported.
According to the board's communique, Rutskoi's group had organized a
meeting on 4 February called "a session of the party's federal council"
where it decided to take the party out of the umbrella organization, the
Social Democratic Union, in order to concentrate its efforts on
Rutskoi's "Derzhava" (Great Power) movement. In a 6 February interview
with RFE/RL, Rutskoi explained the meeting as his attempt to expel
Vasilii Lipitsky, the RSDP former first deputy who now heads the union.
The umbrella group was formed last fall in an attempt to consolidate
various social democratic forces. The union is the only social
democratic group in Russia to have won the support of the trade unions.
Thanks to good relations with Mikhail Gorbachev, the union has also
succeeded in winning recognition from Socialist International, as the
legitimate representative of world social democracy in Russia. In
contrast, Rutskoi's "Derzhava" is a relatively moderate nationalist
movement that seems to have little in common with traditional social
democracy. -- Julia Wishnevsky, OMRI, Inc.

"MEMORIAL," DPR REBUFF YELTSIN'S "PUBLIC" INITIATIVES. The leadership of
Russia's oldest non-communist political party--the Democratic Party of
Russia--has accused the government of violating all the provisions of
the Public Accord Agreement, ITAR-TASS reported. DPR leaders called for
an assembly of the agreement's signatories to discuss the Russian
executive's recent actions. The agreement was penned last year in the
office of Yeltsin Chief of Staff Sergei Filatov, who persuaded both
Russian parliament speakers, leaders of political parties, and various
non-political organizations to sign it without discussion. Later, on 4
February, the widely respected human rights "Memorial" society
officially resigned from the presidential Public Chamber. Yeltsin set up
the chamber in 1993, and entrusted it, rather than the rebel parliament,
with the task of drawing up a new constitution. He maintained the
chamber after the December 1993 elections because his supporters had not
gained enough support in the new parliament. -- Julia Wishnevsky, OMRI,
Inc.

YELTSIN SIGNS PRIVATIZATION DECREE. Russian President Boris Yeltsin
signed a decree ordering a special privatization plan for Moscow,
Interfax reported on 6 February. The decree, based on proposals by
economist Grigorii Yavlinsky, leader of the reformist Yabloko group in
parliament, authorizes municipal authorities to set asking prices in
auctioning state property, allowing them to sell such property at prices
much higher than the rest of the country. The regulation cancels a
clause in the official privatization program, effected by Yeltsin last
July, which stipulated that asking prices for the property of an
enterprise should be based on its fiscal balance as of 1 January 1994.
The decree also allows the municipal government to sell non-residential
buildings at market prices and gives a building owner the right to a 49-
year lease of the land on which the building is situated. Municipal
authorities are now allowed to entrust the administration of unsold
shares to the managers of the privatized enterprise. The decree also
allows for some of the receipts from the sale of state enterprises to be
used to renovate other enterprises. -- Thomas Sigel, OMRI, Inc.

INVESTORS PROTEST IN MOSCOW RALLY. More than 1,000 people, who lost
their investments in Russian shareholding companies and banks, held a
protest rally in Moscow on 5 February, Interfax reported. In the
demonstration, organized by the Labor Forum Trade Union Association and
the Union of Privatization Check Holders, protesters demanded the
government take tight control over Russia's money market and called for
the creation of a political party of investors. The rally brought
together stockholders who have interests in investment companies which
include the Tibet and Chara concerns, the Ronika Company, and Capital
Bank. Moscow City Duma Councilor Vyacheslav Marakov, an organizing
member of the protest, told Interfax the president and the government
should meet with the investors' representatives and appoint a
conciliation commission to solve the problems of company debts and non-
payments to clients. -- Thomas Sigel, OMRI, Inc.

RUSSIA ENCOURAGES INVESTMENT IN MINERAL DEPOSIT REGIONS. In an attempt
to attract western investments to its eastern regions where major
mineral deposits are located, Russia's Trade and Industry Chamber
stressed the need to develop this sector at a recent Moscow conference,
Finansovye Izvestia reported on 7 February. Meanwhile, the South African
company, De Beers, which controls 80% of the world's raw diamond market,
hopes to sign a trade agreement with Russia before the end of the year,
Interfax reported. Before the agreement is signed, the two sides must
settle some disputed points, including De Beer's insistance that most of
Russia's diamond sales be channeled through their Central Sales
Organization. -- Thomas Sigel, OMRI, Inc.

PROSPECTS FOR IMF LOAN TO MOSCOW REMAIN CLOUDED. The IMF delegation
visiting Moscow was set to leave on 7 February without having concluded
an agreement on a $6.25 billion IMF standby loan, the Financial Times
and Interfax reported. Nevertheless, both IMF and Russian officials
still think the deal will go through. IMF officials continue to have
doubts about Russian revenue forecasts and the government's political
commitment to stabilization. In addition, the IMF is concerned that
Russia has failed to deliver on its promise to liberalize oil exports.
Disbursement of a $600 million loan from the World Bank depends on a
successful conclusion to the IMF talks
-- Michael Mihalka, OMRI, Inc.

TRANSCAUCASIA AND CENTRAL ASIA

AZERBAIJAN DEFENSE MINISTER DISMISSED. Azeri President Heidar Aliev
issued a decree dismissing Defense Minister Mamedrafi Mamedov "for
errors committed when organizing the building up of the army," Interfax
reported on 6 February. Former Deputy Defense Minister Safar Abiev was
promoted to the rank of lieutenant-general and appointed in his place.
He is Azerbaijan's eighth defense minister since September 1991. -- Liz
Fuller, OMRI, Inc.

KYRGYZ ELECTIONS INDECISIVE. Two deputies have been elected to the
Legislative Assembly and eleven to the Assembly of People's
Representatives, a spokesman for the Kyrgyz Central Electoral Commission
told Interfax on 6 February. A second round of voting will take place on
19 February for the 90 constituencies where no single candidate won the
required number of votes. President Askar Akaev predicted that former
Communist Party members will constitute an overwhelming majority in the
new Kyrgyz parliament, while "democrats got lost somewhere on their
way," Interfax reported on 6 February. -- Liz Fuller, OMRI, Inc.

CIS

CIS SUMMIT SET TO GO AHEAD. Despite media speculation to the contrary,
the CIS summit is set to go ahead on 10 February, Russia's Vice-Premier
Aleksei Bolshakov told Interfax on 6 February. Members of the executive
secretariat left Moscow for Almaty on the same day to prepare for the
summit. A preliminary agenda lists more than 20 items to be addressed,
including agreements on a joint economic space, tariff policy, and aid
to refugees. Commenting on Kazakh President Nursultan Nazarbaev's
proposal to strengthen security relations, Georgian Parliament Chairman
Eduard Shevardnadze said, "This is a very interesting proposal, but it
will remain on the level of declaration, unless my amendments concerning
aggressive separatism, and the Commonwealth's attitude to it, are
reflected in the document." -- Michael Mihalka, OMRI, Inc.

[As of 1200 CET]

Compiled by Victor Gomez

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 Media Research Institute. The Daily Digest is
distributed electronically via the OMRI-L list. To subscribe, send
"SUBSCRIBE OMRI-L YourFirstName YourLastName" (without the quotation
marks and inserting your name where shown) to
LISTSERV@UBVM.CC.BUFFALO.EDU No subject line or other text should be
included. The publication can also be obtained for a fee in printed form
by fax and postal mail. Please direct inquiries to: Editor, Daily
Digest, OMRI, Na Strzi 63, 14062 Prague 4, Czech Republic or send e-mail
to: omripub@omri.cz

Telephone: (42 2) 6114 2114 Fax: (42 2) 426 396