Comedy is an escape, not from truth but from despair; a narrow escape into faith. - Christopher Fry
OMRI DAILY DIGEST

No. 134, Part II, 12 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

UKRAINIAN PARLIAMENT ADOPTS LAWS ON EDUCATION, CORRUPTION. Ukrainian
lawmakers approved a new law on education that continues to guarantee
free state secondary education but no longer provides free universal
higher education, UNIAR and Ukrainian TV reported on 11 July. Socialist
deputies refused to take part in the vote. Legislators also amended a
law on public officials and passed a corruption law that allows not only
the recipients of bribes but their so-called intermediaries to be
prosecuted. Those who give bribes to officials but report the offense to
the authorities may be freed from prosecution. The parliament also
ordered wage increases of 20-50% for Interior Ministry employees who
specialize in investigating corruption. -- Chrystyna Lapychak, OMRI,
Inc.

CRIMEAN LAWMAKERS ELECT NEW DEPUTY SPEAKERS. The Crimean legislature
elected three new deputy speakers on 11 July, Ukrainian TV reported the
same day. The choice of Yurii Podkopayev of the Russia caucus, Anushevan
Danelian of the Reforms caucus and Refat Chubarov of the Crimean Tatar
Kurultai caucus reflects a significant loss of separatist forces'
influence in the 98-member assembly. Only Podkopayev represents a pro-
Russian caucus, while the others are considered loyal to Kiev. Lawmakers
recently replaced the separatist leader Serhii Tsekov as speaker with
Yevhen Supruniuk, who supports improved ties with the Kiev government.
-- Chrystyna Lapychak, OMRI, Inc.

UKRAINIAN OIL DEAL WITH TATARSTAN. Pravda on 12 July reported that
Ukraine and Tatarstan have signed an agreement on establishing the
Ukrtatneft financial industrial corporation, which will rely on the
Keremechuk oil refinery in Poltava, Ukraine, to refine Tatarstan's oil.
The corporation's issued share capital has been divided equally between
Ukraine and Tatarstan; its assets are estimated at $1 billion. Tatarstan
has said it plans to invest its share of future profits in modernizing
the Keremenchuk refinery and in prospecting in Tatarstan. Valerii
Pustovoitenko, minister of Ukraine's Cabinet of Ministers, announced
that Ukrainian farmers will be harvesting with gasoline from Tatarstan
this fall. -- Ustina Markus, OMRI, Inc.

ESTONIA, RUSSIA FAIL TO RESOLVE BORDER DISPUTE. Russian Deputy Foreign
Minister Sergei Krylov on 11 July met with Estonian officials,
international and Russian agencies reported. Krylov told journalists
after the meetings that no headway was made on the Estonian-Russian
border dispute. Estonia insists that the border correspond with that
defined in the 1920 Tartu Treaty, which would require the transfer to
Estonia of territory currently in Russia's Leningrad and Pskov Oblasts.
Krylov reiterated Russia's stance that the treaty not be used as a basis
for resolving the dispute, saying "it has no legal power whatsoever." He
also complimented Estonia for recent "positive changes" in policy toward
the Russian minority there. -- Scott Parrish, OMRI, Inc.

OPTIMISM OVER ESTONIAN, LITHUANIAN ECONOMIES. Reuters and BNS on 11 July
reported that the Estonian and Lithuanian economies are expected to grow
this year but that Latvia is suffering from a banking crisis. Estonia's
GDP is expected to register a 5% increase for 1994 and grow 6% this
year. Much of the success is attributed to its export sector. The IMF
estimates that Lithuania's GDP grew between 1-5% in 1994 and will
increase by 5-7% this year. In other news, BNS reported that Estonia has
so far been granted $477 million in credits, of which $247 million have
been paid out. But it decided not to accept 100 million kroons from a
588 million kroon loan provided by the EBRD to update the country's
energy sector. The official reason was that it was difficult to meet
EBRD conditions and that repayment of the principal would begin next
year. -- Ustina Markus, OMRI, Inc.

MORE TROUBLE AMONG LATVIAN BANKS. BNS on 11 July reported that the Bank
of Latvia has revoked the license of the commercial Kredo Banka and will
take it to the Economic Court to have it declared insolvent. The Bank of
Latvia the same day issued a statement calling for the public to ignore
the Latvian Shipping Company's threats against the collapsed Baltija
Bank. The shipping company, which was the bank's largest creditor, has
claimed that Blatija Bank pledged all its assets to the company in the
event that it failed to return the company's $44 million deposit on
time. The company has argued that it should receive all incoming
payments to the bank. The Bank of Latvia said the shipping company's
statement violates Latvian civil code. -- Ustina Markus, OMRI, Inc.

SWEDISH EUROPEAN AFFAIRS MINISTER IN POLAND. Mats Hellstroem, visiting
Poland on 10 July, met with Polish Foreign Trade Minister Jacek Buchacz,
Polish and international media reported. Hellstroem said that "Sweden is
a strong supporter of Poland's accession to the European Union" and
would back Poland's requests to the EU for an easing of anti-dumping
procedures against Polish goods, such as textiles, food stuffs, cement,
and steel. He noted that Poland, in turn, should liberalize its customs
policy and other trade barriers. Hellstroem also said that Poland was
Sweden's most important economic partner in Eastern Europe, with total
trade turnover exceeding $1 billion in 1994. -- Jakub Karpinski, OMRI,
Inc.

CZECH REPUBLIC TO END WAGE REGULATION. Czech ministers on 11 July
announced it will stop wage regulation immediately, Czech media
reported. Labor and Social Affairs Minister Jindrich Vodicka was
instructed to prepare the necessary documents for a plenary cabinet
meeting the next day. Although the government decided in May that wages
would remain regulated until the end of this year, Prime Minister Vaclav
Klaus said the time has come to free them. Wages have been controlled
since July 1993 for firms with more than 25 employees, and rises have
been pegged to inflation and company performance. According to Finance
Ministry figures, firms breaching the regulations have paid almost 200
million koruny in fines. -- Steve Kettle, OMRI, Inc.

SLOVAK UPDATE. Parliament Chairman Ivan Gasparovic on 11 July announced
that President Michal Kovac has vetoed the recently passed amendment to
the law on the Slovak army, which will be discussed again on 13 July.
The Slovak cabinet the same day approved draft laws on labor and prices
and also discussed a protest by the Slovak Confederation of Trade Unions
against increased public transportation rates and cuts in social
benefits. In other news, according to a Financial Times report on 11
July, the EBRD has taken a 10.5% stake in the petrochemical giant
Slovnaft, after a global share offering failed to attract Western
investors because of political uncertainty in Slovakia and the high
price of the shares. -- Sharon Fisher, OMRI, Inc.

SLOVAKIA TO MEET CFE CUTS. The remaining 14 Slovak T-55 tanks to be
destroyed in order to meet the country's Conventional Forces in Europe
ceilings left their base for the scrap yard on 11 July, CTK reported. A
total of 822 tanks, 386 infantry fighting vehicles, and 424 artillery
systems have had to be destroyed. Besides the 14 tanks, all that remains
are 38 howitzers, which are due to scrapped later this month. -- Doug
Clarke, OMRI, Inc.

SOUTHEASTERN EUROPE

SERBS OVERRUN SREBRENICA, THREATEN TO SHELL REFUGEES. Bosnian Serb
forces took the UN-designated "safe area" of Srebrenica on 11 July.
Belated NATO air strikes halted a Serbian tank column, but Serbian
infantry and artillery carried the day. Dutch peacekeepers fled to their
base to the north, where some 30,000 refugees have also sought
protection. The French group Doctors without Borders told Croatian Radio
that the town of 42,000 is "completely empty" and that those who have
not fled to the Dutch have gone to the hills. Reuters on 12 July quoted
Bosnian Serb commander General Ratko Mladic as threatening to shell the
refugees if further air strikes are launched against his forces, which
have stepped up their attacks against the "safe areas" of Zepa, Gorazde,
and Sarajevo. Bosnian Croat army sources told Croatian Radio that more
Serbian militiamen are moving into Bosnia from Serbia via the northern
Posavina corridor. -- Patrick Moore, OMRI, Inc.

"TOO LITTLE, TOO LATE." This is how a number of people, including the
Bosnian prime minister and foreign minister, described the NATO air
strikes on 11 July. Croatian Radio quoted Prime Minister Haris Silajdzic
as saying the UN forces have cooperated with the Serbs, while the VOA
noted his remarks that the UN has deliberately delayed employing air
strikes as long as possible. Bosnian Ambassador to Croatia Kasim Trnka
told AFP that Srebrenica was the "price to be paid" for the secret deal
in which the UN got back the hostages from the Serbs last month. The BBC
quoted Mladic as saying that his aim is to "demilitarize" Srebrenica,
and that the civilians have nothing to fear if they stay. A BBC analyst
suggested that the Serbs are anxious to "mop up" the eastern Bosnian
Muslim enclaves to free their troops for use around Sarajevo. -- Patrick
Moore, OMRI, Inc.

TURNING POINT FOR THE UN IN BOSNIA. International media on 12 July
generally agreed that a new stage has been reached in the conflict. Not
only has a major humanitarian crisis emerged, but for the first time a
"safe area" has fallen to a Serbian assault and the UN has undeniably
failed to carry out its mandate. This "calls into question the vitality"
of the UN mission in Bosnia, according to U.S. Secretary of Defense
William Perry, the VOA said. The BBC reported that the safety of
Gorazde, Zepa, and Sarajevo now appears precarious, but UN Secretary-
General Boutros Boutros Ghali and U.S. Secretary of State Warren
Christopher warned that for the UN to withdraw or change its approach
would be to invite a blood bath. U.S. Senate Majority leader Robert
Dole, however, said that it is now clear that the only way out of the
imbroglio is for the UN to pull out and for the U.S. to lift the arms
embargo against the Bosnian government. -- Patrick Moore, OMRI, Inc.

WILL THE UN GET TOUGH AFTER ALL? The International Herald Tribune on 12
July quoted French President Jacques Chirac as saying "France is ready
to use its means at the request of the Security Council. I do not see
what will stop the Serbs in the other enclaves or in Sarajevo" if the
world body accepts the fall of Srebrenica without a fight. The Security
Council on 11 July began work on a resolution drafted by France,
Britain, and Germany that would allow use of "all available means" to
oust the Serbs from Srebrenica if they refuse to go peacefully. But the
VOA on 12 July noted that "nothing is clear in this resolution." The UN
might decide to try diplomacy, which has largely proven useless in the
past. In any event, the final word on use of force would rest with the
cautious Boutros Ghali. Reuters says Bosnian Serb leader Radovan
Karadzic has no intention of pulling back his forces: "What withdrawal?
From our country? Srebrenica is our country." -- Patrick Moore, OMRI,
Inc.

SERBIAN RENEWAL MOVEMENT FEARS DELAY OF SANCTIONS' LIFTING. Reactions
from Belgrade to the latest Bosnian developments are so far limited to a
statement by the opposition Serbian Renewal Movement, published in Nasa
Borba on 12 July. Party spokesman Ivan Kovacevic is quoted as saying
"the war activities of Pale will delay the lifting of the sanctions"
against the rump Yugoslavia. Meanwhile, the U.S. House of
Representatives adopted an amendment saying the embargo against rump
Yugoslavia may not ended until excessive Serbian control over Kosovo
ceases, international agencies reported on 11 July. -- Fabian Schmidt,
OMRI, Inc.

NEW EU POLICY ON FUTURE OF EASTERN SLAVONIA? Belgrade's Politika on 11
July quoted Portugal's ambassador to the EU, Jose Manuel de Costa
Arsenio, as saying he could well imagine eastern Slavonia, western
Srijem, and Baranja soon becoming part of Serbia. Those territories at
present constitute the UN-designated Sector East of Serbian-occupied
Croatia, which the Portuguese diplomat was visiting. The area is already
well integrated with Serbia, although it lies within Croatia's
internationally recognized boundaries. Vjesnik on 12 July wondered
whether the diplomat's remarks are perhaps a straw in the wind
suggesting a change in EU policy. -- Patrick Moore, OMRI, Inc.

ROMANIA REJECTS HUNGARIAN CRITICISM. The Romanian Foreign Ministry on 10
July rejected Hungarian Foreign Minister Laszlo Kovacs's criticism of
Romania's new education law (see OMRI Daily Digest, 11 July 1995), Radio
Bucharest reported. The ministry said Kovacs's statement was an attempt
to put pressure" on Bucharest. It noted that the law meets European
standards and even "goes beyond what is required." Above all, the
ministry argued, the law is far more responsive to the needs of national
minorities than is the case in Hungary, where "the Romanian and other
national minorities . . . continue to face the danger of assimilation."
-- Michael Shafir, OMRI, Inc.

ROMANIA'S WESTERN CONTACTS. Greek Foreign Minister Karolos Papoulias, on
an official visit to Romania, held talks with his counterpart, Teodor
Melescanu, and Senate chairman Oliviu Gherman on 11 July. Papoulias was
received the same day by President Ion Iliescu, Radio Bucharest and
Romanian Television reported. Talks concentrated on bilateral relations,
regional affairs, and what was termed as "concrete tripartite projects"
with Bulgaria on transport and telecommunications infrastructure.
Papoulias expressed support for Romania's integration into NATO and the
EU. He also said Athens would ease visa procedures for Romanian
citizens. Romanian Television reported that Iliescu the same day
received Gebhardt von Moltke, NATO assistant secretary-general for
political affairs. Von Moltke said NATO wished Europe to be built on
collaboration among states and thus the admission of new members to NATO
must ensure European security rather than create "new cleavage-lines on
the continent." -- Michael Shafir, OMRI, Inc.

NO BREAKTHROUGH IN TALKS BETWEEN ROMANIA, WORLD BANK. Talks in
Washington between the World Bank and a Romanian delegation, headed by
Finance minister Florin Georgescu and National Bank Governor Mugur
Isarescu, have failed to produce concrete results. The bank on 11 July
said the talks focused on Romania's progress in implementing economic
reforms. The press release said that although some important reform
measures have already been implemented, a number of steps still have to
be taken before negotiations on a proposed "financial and enterprise
sector adjustment loan" can take place. Following the "constructive
exchange of views," the press release said, the prospects that
negotiations can begin in September 1995 are good. -- Michael Shafir,
OMRI, Inc.

CHISINAU, TIRASPOL ON SNEGUR-SMIRNOV MEETING. Transdniestrian Supreme
Soviet chairman Grigori Markutsa, commenting on the 5 July meeting
between Moldovan President Mircea Snegur and leader of the Transdniester
region Igor Smirnov, said Tiraspol would not agree to an arrangement
whereby the special status of the region would be determined by Moldovan
law. BASA-press reported on 10 July that Markutsa said Tiraspol insisted
on an agreement "between two equals," with the OSCE, Russia, and Ukraine
guaranteeing its fulfillment. Snegur, speaking on Moldovan Television on
10 July, said Chisinau proposes "an autonomy status for the region
within the framework of the Republic of Moldova," Infotag reported on 11
July. -- Michael Shafir, OMRI, Inc.

SNEGUR ON REFERENDUM ON OFFICIAL LANGUAGE, POLITICAL OPPONENTS. Moldovan
President Snegur also said on Moldovan Television on 10 July that the
proposal for a referendum on his initiative to designate Romanian as the
country's official language was "an aberration," BASA-press reported on
11 July. He said the true motive for the proposal, made by 65
parliamentary deputies, was to demonstrate that the legislature has more
power than the president to make "fundamental decisions." He accused his
opponents of trying to discredit him, saying that a political party that
"would consolidate the presidential team" should be set up. -- Michael
Shafir, OMRI, Inc.

U.S. APPROVES MOST-FAVORED-NATION STATUS FOR BULGARIA. The U.S. House of
Representatives on 11 July passed a bill to extend permanent most-
favored-nation status to Bulgaria, Reuters reported the same day.
Bulgarian exports to the U.S. can thus enter the country at the lowest
possible tariffs. The decision was considered non-controversial and no
objections were raised. Bulgaria was granted most-favored-nation status
in 1991 but had to renew it each year. The bill has now been sent to the
Senate. -- Stefan Krause, OMRI, Inc.

BULGARIAN OPPOSITION WITHOUT JOINT CANDIDATE FOR SOFIA MAYORAL
ELECTIONS. The Union of Democratic Forces (SDS) on 11 July named Stefan
Sofiyanski as its candidate for the post of mayor of Sofia, 24 chasa
reports the following day. The decision came one day after former Prime
Minister Reneta Indzhova was nominated mayoral candidate by the People's
Union (see OMRI Daily Digest, 11 July 1995). A meeting between the
leadership of the two groups aimed at finding a common candidate is
scheduled for this week. Meanwhile, SDS leader Ivan Kostov confirmed
that his party had initially considered backing Indzhova's candidacy. --
Stefan Krause, OMRI, Inc.

U.S.-ALBANIAN MILITARY EXERCISES KICK OFF. U.S. and Albanian troops on
11 July began joint exercises within the framework of the Partnership
for Peace program, AFP reported. The exercises continue until 8
September, during which period Albania's only military hospital will be
modernized. The cost of reconstructing the hospital, built by the
Italians during World War II, is estimated at $ 1.5 million and will be
met by the U.S. Defense Minister Safet Zhulali said the maneuvers are
the "most important military exercises between the American army and a
Central or Eastern European country." Meanwhile, the U.S. has started
deploying unmanned Predator spy planes in northern Albania to gather
intelligence over Bosnia. -- Fabian Schmidt, 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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No subject line or other text should be included.
To receive the OMRI Daily Digest by mail or fax, please direct inquiries
to OMRI Publications, Na Strzi 63, 140 62 Prague 4, Czech Republic; or
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Tel.: (42-2) 6114 2114; fax: (42-2) 426 396

OMRI also publishes the biweekly journal Transition, which contains
expanded analysis of many of the topics in the Daily Digest. For
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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