No. 93, Part I, 15 May 1995

We welcome you to Part I of the Open Media Research Institute's Daily
Digest. 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.  Back issues of the Daily
Digest, and other information about OMRI, are available through our WWW
pages: http://www.omri.cz/OMRI.html

RUSSIA

CHERNOMYRDIN BLOC HOLDS FOUNDING CONGRESS. Prime Minister Viktor
Chernomyrdin was unanimously chosen to lead the center-right electoral
bloc, Our Home Is Russia, at the movement's founding congress, Russian
agencies reported on 12 May. First Deputy Prime Minister Oleg Soskovets
and Samar Oblast Governor Konstantin Titov will be Chernomyrdin's
deputies, and Deputy Prime Minister Sergei Shakhrai and Tatarstan Prime
Minister Farid Mukhamedshin will be among the bloc's 125 board members,
Ekho Moskvy reported. Chernomyrdin stressed that "stability" would be
the movement's "key word," Russian TV reported. Responding to charges
that his new electoral ambitions do not befit a prime minister,
Chernomyrdin challenged his critics to "name one democratic country
where the executive branch is apolitical and non-party, and its
representatives show no interest in parliamentary elections," Russian
Public Television reported. Shakhrai promised that budgetary funds would
not be used to finance Our Home Is Russia, which will rely on
contributions from "large enterprises and firms," according to Russian
Television. Business leaders, including the director of the Avtovaz
corporation and the president of the Association of Russian Banks, also
attended the congress, NTV reported. -- Laura Belin, OMRI, Inc.

MORE REACTION TO CHERNOMYRDIN BLOC. Many politicians have continued to
denounce Chernomyrdin's bloc as the "party of power." Duma Press and
Information Committee Chairman Mikhail Poltoranin predicted that the
bloc would not have a "happy fate," saying it is doomed to become the
president's "whipping boy," Russian Public Television reported on 13
May. Commenting on Chernomyrdin's nomenklatura connections dating back
to his days running the Soviet gas industry, "Forward, Russia!" leader
Boris Fedorov suggested that a more fitting name for the new bloc would
be "Our Home Is Gazprom." However, St. Petersburg Mayor Anatoly Sobchak,
a consistent supporter of Yeltsin, called on "all reformist, democratic,
healthy forces in society" to support Chernomyrdin's bloc, Radio Rossii
reported. Sobchak said Russia needs strong parties that can draw up
intelligent programs and take responsibility for implementing them. --
Laura Belin, OMRI, Inc.

KOLOMNA HOLDS DUMA BY-ELECTION. The cosmonaut German Titov, representing
the Communist Party of the Russian Federation, was the front-runner in
voting to fill the Duma seat in Kolomna left empty after the
assassination of Liberal Democratic Party deputy Sergei Skorochkin, Ekho
Moskvy reported on 15 May. Approximately 36% of the eligible voters
participated, well above the 25% barrier for the elections to be valid.
A survey of polling stations along Kolomna's main street found that
precincts with heavy concentrations of military families were the most
active. According to statistics gathered by the city's administration,
the rural areas were more active than Kolomna itself. Alexei Vedenkin
was in the city for the elections and lodged a protest with the police
against Yelena Mavrodi for distributing anonymous flyers that criticized
him. Vedenkin's flyers were available at the central train station. They
praised Josef Stalin, denounced international Zionism and the U.S. as
Russia's greatest external enemies, and stressed the need for Orthodox
Christians and Muslims to unite against Jews to protect Russia's
interests. According to local officials, the State Duma was carefully
monitoring the elections because they could foreshadow how medium-sized
Russian cities with ethnically mixed populations will vote in December's
nationwide parliamentary elections. -- Robert Orttung, OMRI, Inc.

LEBED SAYS HE WILL NOT RESIGN. Contradicting previous statements
indicating his departure from the armed forces was imminent, 14th Army
Commander Lt. Gen. Alexander Lebed announced that he has no plans to
resign, Russian agencies reported on 12 May. According to NTV, Lebed
opened his press conference by saying, "It's difficult to swim in
hydrochloric acid with your legs cut off. It's no less difficult to
serve in the army." However, Lebed said he felt responsible for keeping
the peace in the breakaway Transdniester region of Moldova and would not
leave before a political resolution of the conflict was achieved,
Russian Public Television reported. In the past, Lebed has said Defense
Minister Pavel Grachev's order to restructure the 14th Army left him "no
choice" but to resign, and Lebed's participation in the April conference
of the Congress of Russian Communities led to widespread speculation
that he would soon devote his full attention to politics. -- Laura
Belin, OMRI, Inc.

URALS LEADER ROSSEL BESTS MOSCOW. President Yeltsin signed a decree on
11 May allowing, "by way of exception," the residents of Sverdlovsk
Oblast to elect their governor, Segodnya reported the following day. The
campaign to hold elections was spearheaded by Eduard Rossel, chairman of
the Oblast Duma, and a favorite to win the governorship. The oblast is
the first to win the right to hold gubernatorial elections since a
presidential decree last fall banned them without Moscow's explicit
approval. According to Kommersant-daily of 13 May, Rossel's backers
included Constitutional Court Chairman Vladimir Tumanov, Federation
Council Speaker Vladimir Shumeiko, and Yeltsin's aide for legal issues,
Mikhail Krasnov. Rossel said that if elected, he would strive to
coordinate the economic policies of Urals republics and regions but
would not resume efforts to establish a Urals republic. Rossel was
removed from the post of Sverdlovsk Oblast governor in November 1993 for
attempting to set up such a republic. -- Penny Morvant, OMRI, Inc.

CHARGES DROPPED IN MOST GROUP CASE. The Main Military Prosecutor's
Office has dropped its case against members of the Presidential Security
Service who were charged with exceeding their powers in a raid on the
headquarters of the Most financial group on 2 December 1994, Moskovsky
komsomolets reported on 13 May. The charges were brought by the Krasnaya
Presnya prosecutor immediately after the raid, in which masked members
of the presidential guard clashed with Most security guards and Federal
Counterintelligence Service officers. The Most Group, which is headed by
Vladimir Gusinsky, has interests in various companies, including NTV. --
Penny Morvant, OMRI, Inc.

FOREIGN MINISTRY VIEWS ON CLINTON'S CFE STANCE. A senior Russian Foreign
Ministry official asserted on 12 May that U.S. President Bill Clinton
shares NATO's "tough view" against the CFE treaty's revision and will
not meet Russia's request to revise its flank restrictions, Interfax
reported the same day. Nevertheless, the official said Clinton agreed
that the treaty had been overtaken by events and should be addressed at
the Vienna review conference in May 1996. Although Russia is
dissatisfied with the CFE flank restrictions, the official stressed that
"Russia can hardly be expected to withdraw from the CFE treaty." He said
such views expressed by the Russian Defense Minister Pavel Grachev
reflect only those of his ministry and not those of the government as a
whole. Instead, the official said the treaty "meets Russian interests
because it imposes similar restrictions on NATO." He expressed the hope
that further consultations between Russia and the U.S. on the matter
would take place after Clinton returns from his European trip. --
Michael Mihalka, OMRI, Inc.

IRAN DEAL NOW ONLY WORTH $500 MILLION. Stripped of its military
elements, the Russia nuclear cooperation deal with Iran is now worth
half its original $1 billion price tag, Segodnya and Nezavisimaya gazeta
reported on 12 May. Segodnya cited Yury Vorontsev, the Russian
ambassador to Washington, as the source of the assessment. According to
Nezavisimaya gazeta, the Russian leadership's statements that the Iran
nuclear deal has no military component are a reflection of their basic
ignorance in the matter. The paper advocates an investigation into why
the public learned about the military aspect of the deal from American
and not domestic sources. -- Michael Mihalka, OMRI, Inc.

FOREIGN CURRENCY CASH INFLOW DECREASING. The volume of cash foreign
currency brought into Russia by banks and individuals is steadily
decreasing, a Central Bank of Russia official was quoted as saying in
Finansovye Izvestiya on 11 May. In February, foreign cash worth about
$860 million was brought into Russia, compared to the January figure of
$2.6 billion. During the past year, more than $21.7 billion in cash was
brought into the country. The bank official attributed the downward
trend in the currency influx to the strengthening ruble. -- Thomas
Sigel, OMRI, Inc.

DUMA ADOPTS DEBT RESTRUCTURING LAW. The Duma adopted a law requiring
that both houses of parliament ratify all international agreements
concerning foreign debt restructuring on state credits, Interfax
reported on 11 May. Konstantin Zatulin, chairman of the Duma Committee
for CIS Affairs, said foreign countries and former Soviet republics owe
Russia about $80 billion. -- Thomas Sigel, OMRI, Inc.

ONE BILLION DOLLAR LOAN BACKED BY OIL. The Russian government approved a
plan to take out a $1 billion loan which will be backed by export
guarantees of 25 million tons of crude oil after five years, Russian and
Western agencies reported on 12 May. Balkar Trading, a Russian-British
trading company, will arrange the loan in return for government
guarantees of access to export pipelines. It will purchase the oil on
the Russian market and sell it on the world markets through Mobil
Corporation. Mobil is expected to raise funds for the loan by selling
debt securities on world markets. -- Thomas Sigel, OMRI, Inc.

RUBLE RISES AGAINST DOLLAR. The Russian ruble rose by 18 points to 5,088
to $1 on 12 May MICEX trading, the Financial Information Agency
reported. Initial supply exceeded initial demand by $63.47 million
totaling $214.98 million. Brokers attributed the dollar's slide to the
decline of quotations on the off exchange market, making it more
profitable for banks to sell currency at MICEX. -- Thomas Sigel, OMRI,
Inc.

GOVERNMENT TO FINANCE DEFICIT FROM 'NON-INFLATION" SOURCES. The Russian
government will finance the 1995 budget deficit (73.1 trillion rubles)
from "non-inflation" sources, Finance Minister Vladimir Panskov told the
Financial Information Agency on 12 May. Panskov said government
securities will remain the primary source of financing the budget
deficit; however, the Finance Ministry still has to artificially
restrict the placement of short-term government bonds in the financial
market because it is not profitable to attract money from commercial
structures for three to six months. Panskov said that when inflation
falls to 2-3% in the third and fourth quarter, long-term bonds will be
issued on a mass scale. -- Thomas Sigel, OMRI, Inc.

CIS

PROTECTION FOR CIS CITIZENS AND POWS IN DOMESTIC CONFLICTS. The CIS
Inter-Parliamentary Assembly recommended on 13 May that member countries
adopt legislation protecting the rights of citizens and prisoners of war
in armed conflicts, Interfax reported the next day. Azerbaijan made the
proposal that would apply "if a country becomes a party to an inter-
state conflict (war) or if a domestic conflict emerges on the country's
territory between two or more parties, even if one of these parties does
not recognize the existence of such a conflict." The proposal includes
prohibitions against the deportation, hostage-taking, and violence
against the lives and well-being of citizens. The rights of prisoners of
war will be protected in accordance with international law. Countries
involved in conflicts will be required to appoint a "state-protector" to
insure the impartial application of the proposal. If such an official is
not appointed within two weeks, the Red Cross International Committee
will assume the function. Russian Federation Council Vladimir Shumeiko,
who also chairs the CIS Inter-Parliamentary Assembly Council, said the
proposal would apply to all current conflicts in the CIS, including the
one in Chechnya. -- Michael Mihalka, OMRI, Inc.

[As of 1200 CET]

Compiled by Victor Gomez

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