No. 110, Part II, 7 June 1995

This is Part II of the Open Media Research Institute's Daily Digest.
Part II is a compilation of news concerning East-Central and
Southeastern Europe. Part I, covering Russia, Transcaucasia and Central
Asia, and the CIS, is distributed simultaneously as a second document.
Back issues of the Daily Digest, and other information about OMRI, are
available through OMRI's WWW pages: http://www.omri.cz/OMRI.html

EAST-CENTRAL EUROPE

UKRAINIAN PRESIDENT CANCELS TRIP TO ROMANIA BECAUSE OF DOMESTIC CRISIS.
Leonid Kuchma has canceled a scheduled trip to Bucharest for a summit of
the Black Sea Economic Cooperation organization at the end of June,
Reuters and Interfax-Ukraine reported on 6 June. Foreign Minister
Henadii Udovenko told reporters that the domestic political crisis
forced Kuchma to make the decision. He stressed the move was in no way
connected to a territorial dispute between Kiev and Bucharest over land
annexed by the former Soviet Union under the 1939 Molotov-Ribbentrop
Pact. Diplomatic sources said the meeting had been expected to serve as
a forum for the Ukrainian and Romanian leaders to sign long-awaited
friendship and border treaties. -- Chrystyna Lapychak, OMRI, Inc.

UKRAINIAN PROSECUTOR-GENERAL SEEKS PARLIAMENT' S CONSENT TO INDICT
DEPUTY SPEAKER. The Ukrainian Prosecutor-General' s office is seeking
the legislature' s consent to prosecute its first deputy chairman,
Oleksander Tkachenko, on charges of embezzling government funds,
Interfax-Ukraine and Radio Ukraine reported on 6 June. The parliament
must strip Tkachenko of his immunity from prosecution to allow law
enforcement officials to indict him on charges of misappropriating state
funds while chairman of the Zemlya i Lyudy agricultural association.
Lawmakers on 6 June voted to temporarily suspend both Prosecutor-General
Vladyslav Datsiuk and Tkachenko from their duties and set up a special
inquiry committee to look into the matter. Tkachenko and other
legislators have accused Datsiuk of heading a "politically-motivated"
conspiracy to remove the conservative deputy speaker from his post. --
Chrystyna Lapychak, OMRI, Inc.

UKRAINIAN PARLIAMENT INITIALLY APPROVES NEW FOREIGN INVESTMENT BILL. The
Ukrainian legislature on 6 June gave its initial approval to a new bill
on foreign investments in Ukraine, the third such draft since 1991,
Interfax-Ukraine and Radio Ukraine reported the same day. The bill
outlines the legal guarantees and privileges available to foreign
investors. According to government sources, foreign investments have
declined since 1991, accounting for only 2.3% of GDP last year, down
from 4% in 1993 and 3.8% in 1992. -- Chrystyna Lapychak, OMRI, Inc.

EURASIAN SOCIALIST CONGRESS FOUNDED IN KIEV. CIS socialist parties,
meeting in Kiev, have founded a Eurasian Socialist Congress, Interfax-
Ukraine reported 6 June. Oleksander Moroz, chairman of the Ukrainian
parliament and leader of the Socialist Party of Ukraine, was elected
chairman. The congress espouses "integration processes and humanitarian
cooperation, development, and propaganda of a modern socialist
alternative." Socialist parties from Spain, Serbia, France, and Romania
sent observers to the new body' s founding congress. -- Chrystyna
Lapychak, OMRI, Inc.

UKRAINE RESUMES MERGER OF AIR, AIR DEFENSE FORCES. Interfax on 6 June
reported that Ukraine has begun to merge its Air Force and Anti-Aircraft
Defense Force to form the Ukrainian Air Defense Force. It quoted the
commander of the new service, Lt. Gen. Volodymyr Tkachev, as saying the
purpose of the merger was to abolish redundant structures and increase
effectiveness. A similar merger was announced in early 1993, only to be
suspended in December of that year. -- Doug Clarke, OMRI, Inc.

BELARUSIAN DEFENSE MINISTER RESIGNS UNDER CLOUD. Col. Gen. Anatol
Kastenka has resigned following an investigation that revealed illegal
financial and commercial dealings in his department, Radio Minsk
announced on 6 June. The report criticized Kostenko for his "lack of
control" over the military. President Alyaksandr Lukashenka accepted his
resignation and appointed Chief of Staff Lt. Gen. Leonid Maltsev as
acting defense minister. Kastenka' s predecessor also resigned over a
financial scandal. -- Doug Clarke

BALTIC NAVIES TAKE PART IN NATO EXERCISE. Warships from the three Baltic
States are taking part in the NATO naval exercise Baltops ' 95, which
began in the Baltic Sea on 6 June, Interfax reported. A Lithuanian
frigate and mine-sweepers from Estonia and Latvia are participating--as
are naval forces from Poland, Denmark, Norway, Finland, Sweden, Germany,
Ireland, the Netherlands, and the U.S. During the Cold War, the Baltops
maneuvers were annual NATO-only naval exercises in the Baltic
demonstrating a NATO naval presence in that area. Participants in the
Partnership for Peace program and others have recently been invited to
take part. -- Doug Clarke, OMRI, Inc.

ESTONIA NOT TO EXTEND DEADLINE FOR RESIDENCE PERMITS. Prime Minister
Tiit Vahi told the press on 6 June that the government has decided not
to extend the 12 July deadline for aliens residing in Estonia to apply
for residence permits, Interfax reported. He emphasized that residents
who do not apply will not be regarded as "illegal immigrants, subject to
automatic dismissal from their jobs and deportation from the country."
They will retain their property and labor rights but will not be able to
participate in local elections. The Estonian Citizenship and Migration
Department said that only 200,000 of the country' s 400,000 aliens have
applied for residence permits. -- Saulius Girnius, OMRI, Inc.

UZBEK PRESIDENT IN LATVIA. Islam Karimov and Latvian President Guntis
Ulmanis signed a bilateral friendship and cooperation agreement in Riga
on 6 June, BNS reported. Foreign Ministers Abdulaziz Kamilov and Valdis
Birkavs signed agreements on air communications, transport, tourism, and
scientific cooperation as well as a protocol on consultations between
their foreign ministries. The Uzbek delegation travels to Vilnius on 7
June for a two-day visit. -- Saulius Girnius

POLISH GOVERNMENT APPROVES ANTI-INFLATIONARY POLICIES. Polish Finance
Minister Grzegorz Kolodko on 6 June won support from the cabinet for
anti-inflationary measures allowing the liberalization of food imports,
more government intervention in the food market, tighter wage and price
controls, and stricter budgetary discipline. Kolodko urged the Polish
National Bank to slow down the monthly devaluation of the zloty against
a basket of hard currencies, Polish and international media reported.
Also on 6 June, the government approved tougher anti-drug legislation
that introduces prison terms for drug possession and makes no
distinction between hard and soft drugs. -- Jakub Karpinski, OMRI, Inc.

CHINESE DELEGATION IN POLAND. A Chinese parliamentary delegation on 6
June met with members of the Sejm Foreign Affairs Commission. Answering
questions about the June 1989 Tienanmen Square massacre, General Shu
Shin said intervention had been necessary and only criminals were
arrested there. The Chinese delegation demanded that the press be
ordered not to cover the meeting, but commission president Bronislaw
Geremek assured them that the press would be objective, Gazeta Wyborcza
reported. -- Jakub Karpinski, OMRI, Inc.

BANK GOVERNOR SAYS FOREIGN CAPITAL IS FLOODING CZECH ECONOMY. Foreign
capital in the Czech economy exceeded $3 billion at the end of May and
is producing strong inflationary pressures, Czech National Bank Governor
Josef Tosovsky said on 6 June. He told an international conference the
economy cannot absorb the huge inflow of foreign capital, adding that
the bank' s hard currency reserves have risen from $6.2 billion to $9.5
billion, Hospodarske noviny reported. Tosovsky said much of the foreign
capital is short-term speculative money. The government is expected to
approve a new hard currency law next week. Since the parliament will not
discuss the new legislation until September, the earliest date the
koruna can become convertible is October. Tosovsky also said that
expected GDP growth of 3.5% this year is "fragile." -- Steve Kettle,
OMRI, Inc.

SLOVAK PREMIER ON NEW PRIVATIZATION CONCEPT. Vladimir Meciar and Deputy
Prime Minister Sergej Kozlik on 6 June told journalists that under the
new voucher privatization concept in Slovakia, the National Property
Fund will distribute bonds worth 35 billion koruny, with each citizen
receiving bonds worth 10,000 koruny. Citizens will be able to use bonds
not only to buy shares in companies that are to be privatized but also
in a variety of other ways--for example, as down payment on an
apartment. The Slovak government also decided not to abolish the import
surcharge, which the Czech government recently cited as one of the
reasons for proposing that the payments clearing system used in
bilateral trade be abolished. Pravda on 7 June reported that Meciar, has
sent a letter to Czech Prime Minister Vaclav Klaus reacting to Czech
efforts to abolish the clearing system. -- Jiri Pehe, OMRI, Inc.

HUNGARIAN PREMIER MEETS CLINTON. Gyula Horn, on an eight-day visit to
the U.S., met with U.S. President Bill Clinton in the White House on 6
June , international media reported. After the meeting, Horn told
reporters he expected Hungary to join NATO in 1997 and that Clinton had
assured him the U.S. supports Hungary' s membership in NATO. However, a
White House official told reporters that "timetables did not come up in
the Oval Office." A White House statement said that Clinton affirmed to
Horn "that NATO will take in new members on a country-by-country basis,
in a steady, gradual, and transparent fashion." Horn also met with
representatives of the International Finance Corporation, the private
sector affiliate of the World Bank, and representatives of the U.S.
Overseas Investment Corporation. The two organizations will provide
Hungary with a $105 million loan to develop a nationwide digital
cellular telephone network. -- Jiri Pehe, OMRI, Inc.

EAST EUROPEAN MINISTERS MEET EU COUNTERPARTS IN BRUSSELS. Ministers from
Poland, Hungary, the Czech Republic, Slovakia, Bulgaria, Romania, and
the three Baltic States met with EU counterparts in Brussels on 6 June
to discuss how to prepare for membership, Reuters reported the same day.
Czech Trade and Industry Minister Vladimir Dlouhy was reported as saying
that the East' s integration into the EU should be "a two-way street."
Polish Undersecretary of State Janek Saryus-Wolski complained that
Eastern applicants were being asked to do more to apply EU rules than
current members, who have so far enacted only 92% of EU laws. -- Michael
Mihalka, OMRI, Inc.

SOUTHEASTERN EUROPE

SERBS FREE 108 HOSTAGES. International media reported on 7 June that
Bosnian Serbs the previous night sent 108 of their captives to Novi Sad
via Mali Zvornik, on the Serbian-Bosnian border. The men will be flown
out from Belgrade and include 17 British, 32 French, and 58 Ukrainian
soldiers, plus one Spanish military observer. The Serbs still hold about
150 peacekeepers, whom they indicated would also be released soon. Mlada
fronta dnes said the three Czech hostages continue to be held. Serbian
President Slobodan Milosevic' s security chief had held long talks with
the Bosnian Serb leadership, as had the Greek foreign and defense
ministers, who then also met with Milosevic. Nasa Borba reported that
the Greeks are claiming credit for the releases, but the BBC noted that
Milosevic will be anxious to take credit for himself to pry more
concessions from the UN on the lifting of sanctions against Serbia-
Montenegro. -- Patrick Moore

SERBS TAKE WEAPONS FROM UN COLLECTION SITES. Bosnian Serb troops took
one tank and a 100 mm gun from UN storage depots near Sarajevo, AFP said
on 7 June. The M-36 tank was driven from Bare, where two French
peacekeepers still refuse to let the Serbs take them hostage. Vjesnik
reported from Orasje that the Serbian assault on the Croatian-held
pocket in northern Bosnian has now gone on for over a month. The BBC
noted that the food situation in many of the besieged, mainly Muslim
areas of Bosnia is becoming acute, with supplies being given only to the
weak and sick in some places. -- Patrick Moore, OMRI, Inc.

"PANIC IN KNIN." This is how Vjesnik on 7 June described the situation
in Krajina following the advance by Croatian forces to within shelling
range of the Grahovo road connecting Knin with Banja Luka. Western news
agencies speculated on growing rifts within the Krajina leadership under
President Milan Martic, who recently sacked the prime minister,
considered Milosevic' s man in Knin. Nasa Borba added that the first
refugees have already begun leaving Krajina for Bosnian Serb territory.
Croatian President Franjo Tudjman' s top aide, Hrvoje Sarinic, said
Zagreb is willing to talk with Knin. Krajina is impoverished, and
speculation is rife that Milosevic has written it off in a secret deal
with Tudjman that would let Serbia hold the rich area of eastern
Slavonia in return for giving less desirable real estate back to
Croatia. -- Patrick Moore, OMRI, Inc.

BELGRADE TALKS HIT IMPASSE. Negotiations between US envoy Robert Frasure
and Serbian President Slobodan Milosevic aimed at securing the rump
Yugoslavia' s recognition of Bosnia-Herzegovina in exchange for the
lifting of sanctions broke down on 6 June, Reuters reported that same
day. The talks hit an impasse when Milosevic objected to the idea of
introducing a mechanism whereby a body other than the UN Security
Council may reintroduce sanctions. -- Stan Markotich, OMRI, Inc.

ETHNIC ALBANIAN LEADER RELEASED ON BAIL IN MACEDONIA. Nevzat Halili,
leader of the ethnic Albanian Party for Democratic Prosperity-Party for
the People' s Union (PPD-PUPM), has been released on DM 70,000 bail,
Flaka reported on 6 June. He was sentenced to 18 months in prison on 19
May for preventing the police from carrying out their duties in
connection with a police raid on the self-proclaimed Albanian-language
university of Tetovo. The 17 February raid led to clashes between ethnic
Albanians and police in which one Albanian was killed. Halili has been
criticized by nationalist ethnic Albanians for his moderate stance in
the parliament. -- Fabian Schmidt, OMRI, Inc.

JAPAN CONTINUES TO ASSIST MACEDONIA. Japanese Foreign Minister Yohei
Kono on 6 June said Japan will continue extending financial and
technological aid, totaling $5.9 million, to Macedonia to help promote
stability in the Balkans, Reuters reported the same day. Kono made the
pledge at a meeting with his Macedonian counterpart, Stevo Crvenkovski,
who currently is visiting Japan. -- Fabian Schmidt, OMRI, Inc.

ROMANIAN GOVERNMENT OFFERS UNIONS SOCIAL PACT. The Romanian government,
in an effort to stem recent labor protests, has offered a "social pact"
to the three main labor unions. The pact, presented at a press
conference organized by the ruling Party of Social Democracy in Romania,
includes a 10% pay increase by the end of 1995 if the unions call off
the strikes and stay out of politics. Leaders of the National
Confederation of Romania' s Free Trade Unions-The Brotherhood, the
National Labor Bloc, and Alfa Cartel responded by announcing that the
protests would resume on 14 June. The government' s move follows a week
of strikes and protests in the power and rail sectors. A strike by
electricity workers ended on 6 June after they were granted a 5% wage
increase effective from 1 June and an additional 12% by the end of the
year. -- Dan Ionescu, OMRI, Inc.

ROMANIAN PRESIDENT RECEIVES ETHNIC HUNGARIAN LEADER. Ion Iliescu on 6
June met with Bela Marko, chairman of the Hungarian Democratic
Federation of Romania (UDMR), Radio Bucharest reported. The two men
discussed the resolutions adopted at the UDMR' s recent congress in
Cluj. Marko complained about Romanian nationalist parties'  attacks on
those resolutions, which urge greater self-determination for the
country' s large Magyar community. Both Iliescu and Marko stressed the
need for closer contacts between the Presidency and the UDMR. -- Dan
Ionescu, OMRI, Inc.

JUSTICE MINISTERS CONFERENCE IN BUCHAREST. An unofficial conference of
European justice ministers began in Bucharest on 6 June, Radio Bucharest
reported. The meeting, organized by the Council of Europe and the
Romanian Justice Ministry, focuses on the role of justice ministers in
coordinating the legislative process and international cooperation in
Europe. The inaugural session was opened by Romanian President Ion
Iliescu and Council of Europe Deputy Secretary General Peter Leuprecht.
-- Dan Ionescu

MOLDOVAN PRESIDENT SAYS RUSSIA HAS SPECIAL ROLE IN DNIESTER REGION.
Mircea Snegur has said Russia plays a special role in efforts to settle
the conflict in the Dniester region, Interfax reported on 6 June. Snegur
made the comment after accepting the credentials of the new Russian
ambassador in Chisinau, Alexander Papkin. He proposed that Papkin brief
President Boris Yeltsin on a draft document outlining a special status
for the Dniester region based on recommendations by the OSCE mission in
Moldova. Snegur is expected to discuss the draft at his meeting with
Tiraspol leaders on 7 June. -- Dan Ionescu, OMRI, Inc.

KULIKOV IN BULGARIA. Marshal Viktor Kulikov, commander of the Warsaw
Pact forces from 1977 until that organization' s demise in 1991,
criticized aspects of Soviet foreign policy during a recent visit to
Bulgaria, AFP reported on 5 June. Referring to the 1968 invasion of
Czechoslovakia, Kulikov said "With the benefit of hindsight and as a
soldier, I condemn this action." He did, however, defend current Russian
policy in Chechnya, insisting that Moscow' s military action was in
response to violations of the constitution. Kulikov also met with former
Bulgarian communist dictator Todor Zhivkov. -- Stan Markotich, OMRI,
Inc.

[As of 12:00 CET]

Compiled by Jan Cleave

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