Be slow of tongue and quick of eye. - Cervantes
OMRI DAILY DIGEST

No. 198, Part I, 11 October 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 Central, Eastern, 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 AGAINST GUBERNIYAS. Prime Minister Viktor Chernomyrdin
denounced the idea of taking away the special status of Russia's 21
ethnic republics while speaking in Ufa, the capital of Bashkortostan.
The republic was marking the fifth anniversary of its sovereignty within
the Russian Federation, ITAR-TASS reported. Chernomyrdin said Yeltsin is
personally working on a new nationalities policy. Several oblast leaders
and parties such as the Congress of Russian Communities have recently
called for reforming the federal structure to treat all regions equally.
-- Robert Orttung

ST. PETERSBURG DPR BREAKS WITH GLAZEV. The St. Petersburg branch of the
Democratic Party of Russia (DPR) does not want to follow its leader
Sergei Glazev into the Congress of Russian Communities (KRO) because it
wants to preserve its name. The majority of the local party members will
instead work with DPR Duma leader Stanislav Govorukhin who has set up
his own bloc, ITAR-TASS reported. Glazev told party members in St.
Petersburg that working with the KRO would greatly improve their chances
of getting into the Duma, while Govorukhin's bloc has considerably fewer
prospects. The KRO has been relying on the five-year-old DPR's regional
branches to reinforce its own weak regional network. -- Robert Orttung

SIGNATURE COLLECTION CREATES REGIONAL ALLIANCES. The need to collect
200,000 signatures for the December Duma campaign has forced parties to
work together in the regions. The 89 bloc, a successor to the Russia's
Choice movement, is helping Boris Fedorov's Forward, Russia!, hoping
that Fedorov's party will split Vladimir Zhirinovsky's vote, Kommersant-
Daily reported 10 October. The Communists are assisting Nikolai
Ryzhkov's Power to the People because they see him as a potential
presidential candidate for the united left-opposition parties. Yabloko
may be in trouble because it has managed to collect only 80,000 of the
signatures necessary, reflecting its weak presence in the regions and
its refusal to work with other parties. The signatures are due by
midnight, 22 October. -- Robert Orttung

YELTSIN SIGNS REFERENDUM LAW. President Boris Yeltsin signed a law
defining the terms under which referendums can be held, Russian and
Western agencies reported on 10 October. Under the law, a referendum may
be called to adopt a new constitution. It cannot be called to extend the
term of the president or parliament, to change the structure of the
Russian Federation, or to change budgetary or tax legislation. (see OMRI
Daily Digest, 4 October 1995). -- Laura Belin

YET ANOTHER DECEIVED INVESTORS' MOVEMENT HOLDS CONGRESS. Investors
deceived by 53 commercial enterprises across Russia attended a Moscow
meeting of the United Congress of Investors and Shareholders, which
pledged to fight for the interests of defrauded citizens, ITAR-TASS
reported on 10 October. The movement is planning a nationwide referendum
on returning funds invested in state and commercial enterprises and on
the public's confidence in the current government. At least six
different movements claiming to represent the interests of deceived
investors exist in Russia, but they do not coordinate their activities.
The United Congress of Investors and Shareholders planned their strategy
just four days after a new All-Russian Movement of Investors was founded
with its own program to compensate investors for losses (see OMRI Daily
Digest, 10 October 1995). -- Laura Belin

PATRIARCH URGES RUSSIAN YOUTH TO JOIN THE SERVICE. Aleksii II, the head
of the Russian Orthodox Church, called upon draftees to "serve the
Motherland" and "protect and defend it from external and internal
enemies as true Orthodox warriors," ITAR-TASS reported on 10 October.
The patriarch's appeal reflects the Russian military's difficulties with
the ongoing fall draft (see OMRI Daily Digest, 29 September 1995).
According to Izvestiya on 11 October, the Duma wants to override the
veto imposed last week by the Federation Council on a Duma bill that
would retain the original 18-month service term for 1994 draftees.
Legislation passed this spring extended the service term to two years.
The Federation Council argues that the proposed amendments would leave
the army with only 60% of the enlisted personnel it requires. --
Constantine Dmitriev

ARGUMENTS FOR AND AGAINST CHECHEN STATE OF EMERGENCY. Russian Defense
Minister Pavel Grachev called for a state of emergency to be imposed in
Chechnya and for tougher actions by federal troops against Chechen
militants, who he said should be required to surrender their remaining
arms immediately, according to a 10 October interview with Interfax. The
Russian Federal Security Service warned on 10 October that it had
information that Chechen militants were preparing new violent
provocations. Doku Zavgaev, chairman of the Chechen-Ingush Supreme
Soviet which convened in Grozny on 7 October for the first time since
its dissolution in September 1991, said he does not think a state of
emergency would lead to the resumption of war. But he also argued for
elections to be held in Chechnya on 17 December to coincide with
Russia's parliamentary elections; that would not be possible under a
state of emergency. The chairman of the pro-Moscow Chechen provisional
govern- ment, Salambek Khadzhiev, complained that since no one is in
control of the federal forces in Chechnya, a state of emergency should
be imposed only after professional preparatory measures have been
carried out. -- Liz Fuller

SHUMEIKO: NATO EXPANSION WOULD DAMAGE RUSSIAN ECONOMY. Russia opposes
NATO expansion for economic as well as political reasons, Vladimir
Shumeiko, chairman of the Federation Council, told ITAR-TASS on 10
October. Following a meeting with German Foreign Minister Klaus Kinkel,
a strong proponent of NATO expansion, Shumeiko complained that if the
former members of the Warsaw Pact joined NATO and adopted its standards
for military equipment, Russia's financially strapped military industry
would lose a significant market for its products. Shumeiko also
expressed fears that if NATO expanded, Russia would lose access to other
markets in Eastern and Central Europe as well. -- Scott Parrish

WORLD BANK LOAN TO RESTRUCTURE COAL INDUSTRY. Russia will receive a $500
million loan from the World Bank to restructure its coal industry,
Interfax reported on 10 October. The World Bank funds will be used to
close unprofitable pits and provide a social safety net for redundant
miners. The World Bank also approved a $329 million loan to enable 14
Russian cities to purchase trolleys, trams, and buses to ease their
acute public transport problems, Izvestiya reported on 10 October. Most
of the equipment will have to be imported, as Russian production
capacity of those items is limited. -- Penny Morvant

OFFICIALS SAY NO THEFT OF WEAPONS-GRADE NUCLEAR MATERIAL. General Andrei
Terekhov of the Interior Ministry said on 10 October that the
authorities know of no cases of weapons-grade nuclear materials being
smuggled out of Russia. However, Terekhov said 27 cases of theft of
nuclear materials were registered in 1993 and 16 in 1994. He said that
the vast majority were carried out by nuclear industry workers rather
than by organized criminal groups. An additional 6,000 troops and extra
armored vehicles were sent to protect nuclear facilities in 1994 and
1995. A Nuclear Power Ministry spokesman described Western reports of
nuclear smuggling from Russia as an attempt by some Western countries
"to contrive reasons for penetrating defense enterprises and taking
control of production," Interfax reported. -- Penny Morvant

CORRUPTION UNCOVERED IN HEALTH MINISTRY. Moscow police have arrested the
head of the Health Ministry's finance and planning department, Aleksandr
Shirshov, on suspicion of embezzling more than 1.5 billion rubles
($330,000) meant to provide medical vehicles for Chechnya, Russian and
Western agencies reported on 10 October. Health Minister Eduard Nechaev
said the money for the ambulances was paid into a bank that does not
exist. According to Radio Rossii, Nechaev's suspicions were aroused when
the ministry received only 10 out of 41 vehicles it had ordered late
last year. -- Penny Morvant

COMMERCIAL BANKS GIVE GOVERNMENT 1 TRILLION RUBLES TO IMPORT GRAIN.
Commercial banks have lent the Russian government 1 trillion rubles
($222 million) out of the 3 trillion rubles ($667 million) the
government plans to use to buy grain for the federal food fund, First
Deputy Minister for Agriculture Vladimir Shcherbak told Interfax on 10
October. Meanwhile, Vyacheslav Zaolinskii, chairman of the Federation
Council Committee for Agrarian Policy, claimed that Russia will have to
buy 25-30 million tons of grain owing to this year's poor harvest, ITAR-
TASS reported. The chairman said that this year's harvest will only meet
65-70% of Russia's grain requirements. -- Thomas Sigel

GOVERNMENT TO PRIVATIZE TELECOMMUNICATIONS GIANT. In one of the biggest
privatization programs ever to be launched in Russia, the government
said on 10 October that it intends to sell 25% of the telecommunications
company Svyazinvest by 31 December, with a further 24% to be sold next
year, Russian and Western agencies reported the same day. The sale of
the initial stake, which will be offered to international
telecommunication companies, could bring in $1.5-2 billion. The state
will retain a 51% stake. Svyazinvest controls 85 local telephone
companies across Russia, accounting for over 20 million of the 25.5
million phone lines currently installed in the country. -- Thomas Sigel

SEPTEMBER ENERGY PRICES INCREASE. Producer energy prices increased 5.3%
in September, while monthly inflation ran at 4.5%, Interfax reported on
10 October. Electricity and coal tariffs rose by 6.6% and 5% and those
for crude oil, gas, and petroleum products by 2.5%. Last month's oil
producer prices increased by 6% to 273,000 rubles ($61) per ton, which
is still less than two-thirds of the world oil market price. Gasoline
increased by the steepest margin, at 3.8%. Retail prices for gasoline
ran at 1,607 rubles (36 cents) per liter, compared with the producer
price of 509 rubles (11 cents). -- Thomas Sigel

TRANSCAUCASIA AND CENTRAL ASIA

HELICOPTER CRASH IN KAZAKHSTAN. A helicopter carrying 15 passengers,
including seven foreigners, has crashed in the mountains close to
Almaty, killing one of the pilots, Interfax reported on 10 October. The
helicopter was rented for an excursion by foreign participants attending
the international oil and gas exhibition in Almaty. Another Russian-made
Mi-8T helicopter crashed on account of bad weather and lightning in the
mountains in Kyrgyzstan last week, killing all 15 aboard. -- Bhavna Dave

KAZAKHSTANI-CANADIAN JOINT VENTURE ON GOLD FIELD. The Princess Resources
company of Canada is to sign a contract with two Kazakhstani companies
to set up a joint venture for developing Vasilkovskoye, Kazakhstan's
largest gold field, located in its northern region, Marat Bitimbaev, the
deputy minister of geology of Kazakhstan, told Interfax on 9 October.
The venture's charter capital will be equally distributed between
Canadian and Kazakhstani companies. Canadian Placer Dome Inc., which was
to become the joint venture's main Western partner, refused to
participate directly in the project a month ago. Placer Dome sold 27.5%
of its shares to Princess Resources and has received a 38% stake in it.
Some 382 tons of gold is to be mined in this $275 million project. --
Bhavna Dave

CHEVRON, CASPIAN PIPELINE CONSORTIUM CLASH OVER PIPELINE. The U.S.
company Chevron and the Caspian Pipeline Consortium, set up by
Kazakhstan, Oman, and Russia in 1992 to implement the project for
transporting Kazakhstan's oil to the Russian Black Sea coast, are
holding "difficult talks" on the construction of the second phase of the
Caspian pipeline, according to a source from Petroleum Information
Agency (PIA), Interfax reported on 9 October. Chevron is demanding a
proportional share to the size of its investment in the project for
building the second phase of the pipeline. The PIA source said that the
Russia-Oman dominated Consortium, in which Kazakhstan acts only as
observer "under Russia's pressure," had offered Chevron a block of
nonvoting shares, and no guarantees of receiving an equivalent profit.
The second phase of the $1.2 billion project envisages the construction
of a 1,500 km pipeline from the Tenghiz oil field (developed jointly
with Chevron) to Tikhoretsk in southern Russia. -- Bhavna Dave

SIX KILLED, THREE TAKEN HOSTAGE IN TAJIKISTAN. Three Tajik police
officers were captured on 9 October by an unidentified armed group,
ITAR-TASS and Western sources reported. The officers were abducted in
the Garm area, east of Dushanbe, and are believed to be held in an
opposition force camp in the mountains. On 10 October, six Russian
soldiers were killed and four wounded when a supply convoy was ambushed
near Khorog, the capital of the Gorno-Badakhshan region in Tajikistan's
southeast. Both Garm and Gorno-Badakhshan have served as bases for
guerrillas who continue to fight President Imomali Rakhmonov's
government since it took power in late 1992. -- Bruce Pannier

[As of 1200 CET]

Compiled by Victor Gomez

The OMRI Daily Digest offers the latest news from the former Soviet
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Copyright (C) 1995 Open Media Research Institute, Inc. All rights
reserved. ISSN 1211-1570


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