We were born to unite with our fellowmen, and to join in community with the human race. - Cicero
OMRI DAILY DIGEST

No. 133, Part II, 11 July 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

NEW UKRAINIAN JUSTICE MINISTER APPOINTED. Ukrainian President Leonid
Kuchma, continuing with the appointment of a new Ukrainian government,
has named Volodymyr Stretovych, chairman of the parliamentary commission
on legal policy and judicial reforms, as new justice minister, UNIAR
reported on 10 July. Stretovych replaces Vasyl Onopenko. The ministers
of culture and nationalities have yet to be appointed. UNIAR reports
that acting ministers Mykola Yakovyna and Mykola Shulha will likely be
replaced. -- Chrystyna Lapychak, OMRI, Inc.

UKRAINIAN OFFICIALS ABROAD. Ukrainian Foreign Minister Hennadii Udovenko
arrived in Israel on 10 July for an official visit, Ukrainian Radio
reported. At his meeting with Israeli Prime Minister Itzhak Rabin, talks
focused on economic cooperation. It was agreed to set up a joint
commission to promote economic ties. Meanwhile, Ukrainian Defense
Minister Valerii Shmarov completed his week-long visit to the U.S. On 10
July, he met with Ruth Harkin, U.S. head of corporations and foreign
investments, before returning to Kiev the next day. -- Ustina Markus,
OMRI, Inc.

UPDATE ON BELARUSIAN DISARMAMENT HALT. Russian Public Television,
commenting on 10 July on Belarusian President Alyaksandr Lukashenka's
decision to stop transferring the remaining nuclear missiles from
Belarus to Russia, said Belarus is earning a negative international
image on account of the move. Four months ago, Lukashenka halted
dismantling conventional military equipment, which Belarus was obliged
to liquidate under the CFE treaty. Neither the Russian Defense Ministry
nor the president's administration was informed about Lukashenka's
latest move, and both have refused to comment on it. Radio Rossiya
reported that a Foreign Ministry official said the reason for the halt
was that Russian troops are leaving behind ecologically harmful
materials that can be used for neither military nor civilian purposes.
-- Ustina Markus, OMRI, Inc.

BANKING ISSUES IN THE BALTICS. Following the collapse of a number of
small banks in Lithuania, Finance Minister Reinoldijus Sarkinas said he
did not believe Lithuania's largest banks would collapse, Reuters
reported on 10 July. Sarkinas was speaking after the failure of
Lithuania's eighth-largest bank, Aura Bankas. The largest bank in
Latvia, Banka Baltija, collapsed in May. Sarkinas said better laws
protecting depositors are being drawn up, but he added that depositors
in banks that have already failed will not be reimbursed retroactively
since they were warned of the dangers of depositing in the new banks.
Some of those institutions had offered up to 100% interest on deposits.
BNS the same day reported that Estonian commercial banks will start
guaranteeing deposits of up to 20,000 kroons ($10,000) beginning July
1996 and deposits by legal entities as of the year 2000. -- Ustina
Markus, OMRI, Inc.

RUSSIAN DEPUTY FOREIGN MINISTER IN LATVIA. Russian Deputy Foreign
Minister Sergei Krylov, on a visit to Latvia, met with Foreign Minister
Valdis Birkavs, BNS reported. The two leaders agreed to set up a joint
commission to solve outstanding issues and increase cooperation. The new
body will be headed by Deputy Prime Minister and Communications Minister
Andris Gutmanis on the Latvian side; his Russian counterpart has not yet
been named. Talks also focused on trade issues, money frozen in Russian
banks, illegal immigration, and Latvia's demand that Russia hand over
archival materials. The two sides, however, failed to agree on defining
their common border. Krylov left for Estonia on 10 July. -- Ustina
Markus, OMRI, Inc.

PRIVATIZATION IRREGULARITIES IN POLAND. Stefan Kawalec, who was deputy
finance minister in 1994 when Bank Slaski was undergoing privatization,
is to stand trial for "irregularities" that took place during that
process, Polish and international media reported on 10 July. A leading
Finance Ministry official and the bank's director are also to be tried.
Bank employees received a share package worth 10% of its capital, while
ordinary investors were allowed only three shares each. The initial
price, fixed at 500,000 zloty ($25) per share, rose to an equivalent of
$320. According to a parliamentary commission, the state lost about $620
million because the share price was too low. Meanwhile, President Lech
Walesa's spokesman on 10 July said the president will veto the law on
the privatization and commercialization of state enterprises. Walesa
criticized the possibility that commercialization (transforming an
enterprise into a company governed by commercial law) will not
eventually lead to privatization, Polish media reported the next day. --
Jakub Karpinski, OMRI, Inc.

CZECH HALF-YEAR INFLATION ON STEADY COURSE. Consumer prices in the Czech
Republic rose by 1.1% in June, bringing inflation for the first half of
1995 to 5.0%, the Statistics Office reported on 10 July. Government and
Czech National Bank officials said the aim of keeping inflation below
10% this year was on course, but other analysts said expected food price
hikes could push up the index in the second half of the year. Increases
in the price of potatoes, gas, and electricity accounted for much of the
June rise. In the year since June 1994, prices rose 10%, a decrease of
0.2% in year-on-year inflation from May. -- Steve Kettle, OMRI, Inc.

SLOVAK RULING PARTY TO BAR SOROS. The Movement for a Democratic Slovakia
(HZDS) is to bar U.S. financier and philanthropist George Soros from
entering Slovakia because of his refusal to apologize for statements
criticizing Slovak Premier Vladimir Meciar (see OMRI Daily Digest, 7
July 1995). Soros, in a statement issued on 9 July, refused to apologize
for his remarks, which were made at the recent economic forum in Crans
Montana, Switzerland. But he said he regretted that his remarks have
offended some parties in Slovakia, stressing that he did not intend to
damage the interests of Slovakia. Soros also alleged that Slovakia's
interests are being harmed by Meciar's government, which is pursuing
policies that will disqualify Slovakia from membership in West European
institutions. The HZDS Political Council on 10 July said Soros has
confirmed his "anti-Slovak" sentiments. It announced that the party will
initiate a move through the Foreign Ministry to pronounce Soros persona
non grata in Slovakia. -- Sharon Fisher, OMRI, Inc.

SLOVAK PREMIER IN PORTUGAL. Vladimir Meciar, at the start of a three-day
visit to Portugal and Spain, met on 10 July with his Portuguese
counterpart, Anibal Cavaco Silva. TASR quoted Silva as saying Portugal
supports the efforts of Slovakia and the other Visegrad countries toward
EU integration. He also stressed the need to strengthen bilateral
economic relations. In other news, a poll taken by the FOCUS agency in
the first half of June indicated that only 10.8% of Slovaks believe the
cabinet's foreign policy is "correct," 49.2% say it is "partly correct
and partly incorrect," and 22% call it "incorrect." In May 1994, during
Jozef Moravcik's term as premier, 26.1% said foreign policy was correct
and 10.7% considered it incorrect, Sme reported on 11 July. The Slovak
Information Agency, which was recently established by the government to
improve Slovakia's image abroad, recently began operating. According to
Slovenska Republika on 11 July, the SIA plans to distribute information
about Slovakia and focus on serving foreign journalists. -- Sharon
Fisher, OMRI, Inc.

CHINA PRAISES HUNGARY'S POLICIES. Chinese President Jiang Zemin, on a
three-day visit to Hungary, has hailed Hungary's "one-China policy,"
international media reported. He also said China was interested in
expanding economic ties with Hungary. Since both countries are heading
toward a market economy, they "should put aside differences and bring
their relations to a new high," he commented. Foreign Affairs spokesman
Chen Jian, speaking after Jiang's meetings with Hungarian President
Arpad Goncz, Prime Minister Gyula Horn, and Parliament Chairman Zoltan
Gal on 10 July, noted that "the visit so far has been a complete
success." Among the projects discussed were Hungary's participation in
building the Shanghai underground system, exporting buses and an
assembly plant to China, as well as cooperation in agriculture and
banking. -- Jiri Pehe, OMRI, Inc.

SOUTHEASTERN EUROPE

SERBS GIVE SREBRENICA AN ULTIMATUM. International media on 11 July
reported that Bosnian Serb forces have given Bosnian government forces
and the 42,000 civilians in Srebrenica until dawn on 13 July to give up
their weapons and leave town. Some of the civilian refugees appear to
have already begun leaving for the surrounding hills. Serbian artillery
on 10 July also pounded Sarajevo and Zepa. The Frankfurter Allgemeine
Zeitung on 11 July said the Bosnian government has accused the UN of
"deliberate inactivity despite the highly dramatic developments" around
Srebrenica, adding that if the Serbs take the town there may be little
sense in maintaining any UN presence in Bosnia-Herzegovina. Vecernji
list added that women and children in Tuzla are threatening to blockade
local UN forces unless UNPROFOR turns the Serbs away from Srebrenica. --
Patrick Moore, OMRI, Inc.

WHAT DO THE SERBS WANT? UN Secretary-General Boutros Boutros Ghali on 10
July said the UN might call in NATO air strikes if necessary. When a
Dutch commander sought air support, however, the UN civilian
headquarters hesitated until the immediate danger passed. The
International Herald Tribune on 11 July quoted UN officials as saying
they do not believe the Serbs actually intend to take Srebrenica but
merely want to embarrass the Bosnian government and the UN. According to
this view, Srebrenica represents no threat to the Serbs, who, in any
event, do not need 42,000 more Muslim civilians on their hands. The BBC
said that as of 11:00 a.m. local time on 11 July, Dutch peacekeepers
continued to patrol Srebrenica but there was no word as to whether the
Serbian advance was continuing. -- Patrick Moore, OMRI, Inc.

CAN THE UN RECOVER CREDIBILITY? International media on 11 July discussed
how the international organization has found itself in its current
predicament and whether it can be taken seriously again. They maintain
that it has only itself to blame for repeatedly failing to make use of
superior force in response to aggression by irregulars backed by the
rump Yugoslav army and command structure. Nor did the UN enhance its
status in the Balkans by making a secret deal to free the hostages the
Serbs took in late May and effectively giving into Bosnian Serb leader
Radovan Karadzic's blackmail. Media reports added that the UN continues
to display indecisiveness by questioning whether its own mandate in
Srebrenica allows it to attack the Serbs only if the peacekeepers are
fired on or if the town itself is invaded. -- Patrick Moore, OMRI, Inc.

FERAL TRIBUNE UPDATE. Government authorities in Split have begun legal
proceedings against the three thugs who publicly stole and burned copies
of the independent satirical weekly Feral Tribune on 27 June.
Journalists suspected the authorities of at least complicity in the
young men's actions. The three are charged with offenses against the
press and could be fined or receive up to a year in prison, Novi list
reported on 11 July. -- Patrick Moore, OMRI, Inc.

MACEDONIAN-ETHNIC ALBANIAN TALKS IN GENEVA FAIL. Negotiations between
the Macedonian government and the three main ethnic Albanian parties in
Macedonia have ended without any success, international media reported.
Macedonia's ministers of education, justice, and internal affairs
participated in the talks, under the mediation of Gerd Ahrens from the
Geneva Conference on the Former Yugoslavia. The talks focused on higher
education, the legalization of the self-proclaimed Albanian-language
university in Tetovo, local self-administration, and the use of Albanian
as an official language. Meanwhile, 10 ethnic Albanians convicted in
June 1994 of forming a paramilitary group are to be amnestied by
Macedonian President Kiro Gligorov in August. Albania had called their
trial a "rigged political process." Radio Tirana said the move was
important for "easing tension in interethnic relations and starting
closer bilateral relations and cooperation." -- Fabian Schmidt, OMRI,
Inc.

ENORMOUS DAMAGE FROM DOWNPOUR IN MACEDONIA. Heavy rain, storms, and
subsequent flooding on 6 July have caused enormous damage in
southeastern Macedonia, MIC reported on 10 July. The damage is estimated
at several hundreds of millions of dollars. In the regions of Kavadarci
and Negotino, which were hardest hit, two-thirds of the crops were
destroyed and 3,000 houses damaged. One person is reported missing in
Kavadarci. The rail line and highway from Skopje to Gevgelija was also
damaged. President Kiro Gligorov, Prime Minister Branko Crvenkovski, and
Defense Minister Blagoj Handziski visited the region over the weekend,
promising state assistance. -- Stefan Krause, OMRI, Inc.

ROMANIAN, HUNGARIAN FOREIGN MINISTERS' MEETING CONFIRMED. Radio
Bucharest on 10 July reported that Teodor Melescanu and Laszlo Kovacs
will meet in Bucharest on 19-20 July to discuss the "the finalization of
the basic treaty." Radio Bucharest, citing Radio Budapest, quoted Kovacs
as saying that neither the new education law in Romania nor other recent
"extremist anti-Hungarian" measures are good omens for the signing of
the treaty. The education law, he said, contravenes European norms and
international standards, which, according to Romania's Constitution,
should prevail over domestic legislation. The law also violates the
spirit of those parts of the Hungarian-Romanian treaty on which
agreement has already been reached, Kovacs said. Meanwhile, Radio
Bucharest on 10 July reported that Col. Gen. Dumitru Cioflina, chief of
staff of the Romanian army, began a three-day visit to Budapest at the
invitation of his Hungarian counterpart, Sandor Nemeth. -- Michael
Shafir, OMRI, Inc.

ROMANIAN-WESTERN MILITARY RELATIONS. Portuguese Defense Minister Antonio
Figueiredo Lopes and his Romanian counterpart, Gheorghe Tinca, signed a
military agreement in Bucharest on 10 July, Radio Bucharest and
international media reported. Figueiredo Lopes was received the next day
by President Ion Iliescu. The agreement provides for the exchange of
information and visits as well as joint exercises and training programs.
In other news, Gebhardt von Moltke, NATO assistant secretary-general for
political affairs, was received on 10 July by Foreign Minister Melescanu
and Chamber of Deputies chairman Adrian Nastase. Von Moltke is attending
an international seminar in Bucharest on NATO's peacekeeping role. --
Michael Shafir, OMRI, Inc.

ROMANIAN PREMIER IN PAKISTAN. Nicolae Vacaroiu on 10 July paid a one-day
visit to Pakistan, the last leg of his Asian trip, Radio Bucharest
reported. Vacaroiu held talks with his Pakistani counterpart, Benazir
Bhutto, and President Farooq Leghari. The two sides signed agreements on
scientific and technological cooperation, trade, and the protection of
investments. Bhutto said Pakistani businessmen may be interested in
buying Romanian enterprises slated for privatization. -- Michael Shafir,
OMRI, Inc.

MOLDOVAN PRESIDENT ON ECONOMIC REFORM. Mircea Snegur, speaking on
Moldovan Television on 10 July, said it was important to develop the
securities market launched by the opening of the stock exchange in June,
Infotag reported the next day. He stressed that the banking system must
be restructured, the taxation system overhauled, and a mechanism set up
to deal with the bankruptcy of inefficient enterprises. Snegur also said
that agrarian reform was proceeding "with great difficulty" because
conditions for fair competition in agriculture have not been created.
Finally, he mentioned the necessity to restructure the social security
system. -- Michael Shafir, OMRI, Inc.

IRANIAN FIRST VICE PRESIDENT IN BULGARIA. Hassan Habibi arrived in
Bulgaria for a three-day visit on 10 July, international agencies
reported the same day. Habibi and Bulgarian Prime Minister Zhan Videnov
agreed to work together to fight drug trafficking and to improve
facilities for trade payments in order to boost bilateral trade.
Bulgarian government spokesman Nikola Baltov said trade between the two
countries fell from $335 million in 1985 to $114 million in 1994, with
Bulgarian exports totaling just $10 million. Baltov said Bulgaria hopes
to restore "agricultural and food exports for Iran," while Iran will
provide Bulgaria with additional oil supplies. Habibi will meet
President Zhelyu Zhelev and Parliamentary President Blagovest Sendov on
11 July. -- Stefan Krause, OMRI, Inc.

FORMER BULGARIAN PRIME MINISTER TO RUN FOR MAYOR OF SOFIA. Reneta
Indzhova will run in the elections for mayor of Sofia, Standart reported
on 11 July. Her candidacy is supported by the People's Union, an
opposition party that has 18 of the 240 seats in the Bulgarian
parliament. The opposition agreed last month to cooperate in local
elections; but the Union of Democratic Forces is reluctant to support
Indzhova, since it wants to score a success in Sofia itself, Kapital
reported. Indzhova headed an interim government from September 1994 to
January 1995 and was the first woman to become Bulgarian premier.
According to opinion polls, she has a good chance of winning the
elections in the Bulgarian capital. -- Stefan Krause, OMRI, Inc.

BOUTROS GHALI IN ATHENS. UN Secretary-General Boutros Boutros Ghali met
with Greek Prime Minister Andreas Papandreou and Foreign Minister
Karolos Papoulias on 10 July, Western agencies reported the same day.
They discussed the war in Bosnia, Greece's relations with Macedonia and
Turkey, and the situation in Cyprus. Boutros Ghali called the talks
"extremely fruitful and positive," saying he was confident Greece's
problems with its neighbors will be settled quickly and peacefully.
"Negotiations are going on between Athens and Skopje, and I believe we
are near to finding a solution," Boutros Ghali said after the meeting
with Papandreou and Papoulias. He also said the UN will continue its
efforts to find a "peaceful solution" to the Cyprus issue. -- Stefan
Krause, OMRI, Inc.

[As of 12:00 CET]

Compiled by Jan Cleave

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 OMRI Daily
Digest is distributed electronically via the OMRI-L list. To subscribe,
send "SUBSCRIBE OMRI-L YourFirstName YourLastName" (without the
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OMRI also publishes the biweekly journal Transition, which contains
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Transition subscription information send an e-mail to TRANSITION@OMRI.CZ

            Copyright (C) 1995 Open Media Research Institute, Inc.
                             All rights reserved.


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