This is Part II of the Open Media Research Institute's Daily Digest.
Part II is a compilation of news concerning Central, Eastern, and
Southeastern Europe. Part I, covering Russia, Transcaucasia and Central
Asia, 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/Index.html

CENTRAL AND EASTERN EUROPE

UKRAINIAN BORDER DEMARCATION. Ukraine has demarcated its borders with
Poland, Hungary and Slovakia, ITAR-TASS reported on 13 May. Working maps
delineating the border with Belarus should be complete by the end of the
year. Territorial disputes remain unresolved with Romania. Debate
continues with Russia on the borders in the Black and Azov seas. Sewage
leakage from the Moldovan cities of Soroki and Yampil into Ukrainian
gardens and fields is another source of minor border disputes. -- Ustina
Markus

RUSSIAN-UKRAINIAN OIL TARIFF DISPUTE CONTINUES. Russian oil supplied to
Hungary and Slovakia through Ukraine's Druzhba pipeline will increase to
1.5 million tons in May from 900,000 tons in April, ITAR-TASS reported
on 13 May. Ukraine has threatened to block the transit of oil for 16
Russian oil exporters that refuse to pay an increased transit fee.
Ukraine raised the fee at the beginning of this year from $4.53 to $5.2
per ton of oil piped through 100 km of Ukrainian territory. Moscow has
insisted that Russian firms pay the old rate claiming that the price
hike was done unilaterally. -- Ustina Markus

UKRAINIAN LAWMAKERS DISMISS TOP TV OFFICIALS. The Ukrainian Parliament
voted to dismiss state TV and radio's two top officials for alleged
corruption, Reuters and Radio Rossii reported on 13 May. The head of the
legislature's media commission charged Zinovii Kulyk, chairman of the
State Committee on TV and Radio, and Oleksandr Savenko, head of the
national TV company, with giving free air time to broadcast companies
with foreign capital and of corrupt licensing practices. Deputies said
President Kuchma promised to remove the two officials last June after
signing an agreement with legislators on the separation of government
powers. -- Chrystyna Lapychak

RUSSIA CLAIMS ESTONIA HAS IRA CONTACTS. Russian Federal Security Service
(FSB) spokesman Mikhail Kirilin told BNS on 13 May that the Irish
Republican Army has contacted representatives of Estonia's volunteer
defense force, Kaitseliit, and some non-government groups to buy
weapons. Kirilin did not say when the contacts were made. He also
emphasized that the FSB only had information on the contacts and not on
the sale of weapons. Kirilin said the FSB did not supply any information
on the IRA contacts to Estonia's special services, which do not have
"sufficient strength, means, or high enough professional standards to
conduct operative investigations and retain confidentiality." Estonia's
Foreign Ministry has refuted claims that Kaitseliit sold weapons to the
IRA. -- Saulius Girnius

GERMAN DEFENSE MINISTER IN WARSAW. Volker Ruehe in a two-day visit to
Poland on 13 May met with Polish President Aleksander Kwasniewski and
Defense Minister Stanislaw Dobrzanski to discuss bilateral relations and
Poland's efforts to join NATO. Ruehe said Poland will be among the first
new NATO members, but any specific decisions concerning the expansion
will not be made before 1997. He said that as a defense minister he is
"particularly happy about relations between soldiers from both
countries." In a lecture at the International Relations Center, Ruehe
said it is Germany's duty to facilitate Poland's return to Europe and
Poland's role for Germany is "equally important to that of France." --
Jakub Karpinski

SOUTH KOREAN PRIME MINISTER IN WARSAW. South Korean Prime Minister Soo-
sung Lee began a four-day visit to Poland on 13 May. After meeting with
his Polish counterpart, Wlodzimierz Cimoszewicz, Lee said Korea wants to
develop economic ties with Poland and to create companies that would
combine Polish technology with South Korean capital. This is the first
visit of such a high-ranking South Korean official to Poland since the
two countries established diplomatic relations in 1989. Last year
Polish-South Korean trade totaled $542 million, of which Korean exports
amounted to $411 million and Polish exports to $131 million, Polish and
international media reported. Korea's Daewoo Corporation has been
particularly active on the Polish market and formed a joint venture with
Poland to produce cars at the former state-owned FSO car plant in
Warsaw, with a planned investment of $1.1 billion over six years. --
Jakub Karpinski

CZECH TELECOM DEAL IN QUESTION. Charges and counter-charges have been
made since a Prague court invalidated last week a privatization deal
that awarded 27% of Czech Telecom's shares to the foreign consortium
TelSource, Czech media reported. The deal, worth over $1 billion,
represents the biggest foreign investment in the Czech Republic to date.
The controversy is whether or not the representation of shareholders in
the deal was valid since the power of attorney that Economic Minister
Karel Dyba used at the shareholders' assembly was over a year old. While
independent lawyers suggest that the court's decision could jeopardize
TelSource's participation in the privatization, government
representatives said they were not worried. An appellate court will now
rule on the case. -- Jiri Pehe

BROADCAST TELEPHONE CONVERSATION COMPROMISES REPUTATION OF SLOVAK
OFFICIALS. Radio Twist, a private Bratislava-based station, on 13 May
broadcast a recording of a telephone conversation between the head of
the Slovak Intelligence Service, Ivan Lexa, and Internal Affairs
Minister Ludovit Hudek that suggests that the two officials have been
trying to manipulate the results of the investigation into the
kidnapping case of Slovak President Michal Kovac's son. President Kovac
has long maintained that the kidnapping was organized by Lexa's agency
as an act of political revenge; the government has denied such charges.
Radio Twist claims the tape was left in their offices by unknown
persons; however, there is some speculation that the Slovak opposition's
contacts in the secret service obtained the tape. Former Slovak Internal
Affairs Minister Ladislav Pittner of the opposition Christian Democratic
Movement is to hold a press conference on 14 May to identify the
perpetrators of the kidnapping. -- Jiri Pehe

SLOVAK HUNGARIANS ASKED TO SIGN DECLARATION OF LOYALTY. Representatives
of Slovakia's ruling parties at a meeting in Bratislava on 13 May
demanded that Hungarian minority leaders adopt a declaration expressing
their loyalty to the Slovak Constitution and their agreement with the
existing Slovak-Hungarian treaty, Slovak media reported. The government
parties have made adoption of the declaration a precondition to talks on
adopting a law on the use of minority languages and a constitutional
amendment on the rights of ethnic minorities. -- Jiri Pehe

HUNGARY'S NEW FINANCE MINISTER SUFFERS FIRST PUBLIC DEFEAT. Peter
Medgyessy suffered his first public defeat when the government on 10 May
postponed the planned 1997 reintroduction of interest tax, the Budapest
Sun reported. Medgyessy was the main advocate of the interest tax, which
was first introduced in 1988 during his last tenure as finance minister
and was eliminated in 1994. The government is currently seeking
alternative budget revenues to compensate for planned cuts in the
current 48% personal income tax rate. In other news, Medgyessy has asked
former Finance Minister Mihaly Kupa to be his advisor during the public
introduction of the state budget reform. -- Zsofia Szilagyi

SOUTHEASTERN EUROPE

WHO ARE THE SEVEN MYSTERIOUS BOSNIAN MUSLIMS? A scandal is emerging over
a U.S. IFOR officer's decision last week to hand over to Bosnian Serb
police a group of seven uniformed and armed Muslims. The men surrendered
to the Americans near Zvornik, on the Bosnian border with Serbia,
shortly after IFOR heard explosions in the area, Reuters reported on 13
May. The officer said he turned the men over to the Serb police because
they appeared to be civilians despite their dress, their weapons were in
violation of the Dayton agreement, and they were caught on Bosnian Serb
territory. U.S. Maj. Gen. William Nash reportedly disagreed with his
subordinate's action and tried unsuccessfully to retake the men from the
Serbs. Bosnian officials suggested that the men escaped the fall of
Srebrenica last summer and had been hiding out in caves ever since, but
IFOR doubted this saying the seven men looked too well fed and groomed.
The Bosnian government says the Muslim men are not its soldiers and has
played down the incident, but AFP reported that Bosnian Vice President
Ejup Ganic has demanded that IFOR free the men. -- Patrick Moore

ROW OVER ELECTION TIMING IN BOSNIA. International community High
Representative for Bosnia, Carl Bildt, on 13 May in Brussels briefed EU
foreign ministers on the situation in Mostar following the boycott of
the electoral process by six Bosnian Muslim parties, AFP reported.
Bildt's spokesman in Sarajevo said Bildt "prefers a late election to a
premature one," due to "serious problems" posed by the lack of freedom
of movement. However, EU foreign ministers recommended that the EU
administrator for Mostar, Ricardo Perez Cassado, hold the Mostar
elections according to the Dayton peace accord schedule. Delay of the
elections could negatively affect the peace accord implementation, but a
boycott "could create a precedent," causing other election boycotts
elsewhere in Bosnia, AFP quoted an EU spokesman in Mostar as saying. --
Daria Sito Sucic

UN HIGH COMMISSIONER FOR REFUGEES WARNS FREEDOM OF MOVEMENT IS
RESTRICTED. Sadako Ogata said on 13 May that freedom of movement remains
"severely restricted" in Bosnia, citing Mostar as an example, AFP
reported. She also warned European governments that they would
"destabilize the fragile peace" if they sent home 700,000 Bosnian
refugees prematurely, Onasa reported. That same day, the ministers for
refugees of the Republika Srpska, of the Bosnian Federation, and of
Bosnia-Herzegovina, signed a joint declaration saying they would
encourage individuals expelled by ethnic cleansing to visit their homes.
The declaration is based on the 10 principles introduced by UNHCR that
regulate visits of returnees to their pre-war homes, Nasa Borba reported
on 14 May. -- Daria Sito Sucic

RUMP YUGOSLAV BANK GOVERNOR SURVIVES CONFIDENCE VOTE . . . The board of
rump Yugoslavia's national bank met on 13 May, but unexpectedly did not
recommend that its governor, Dragoslav Avramovic, be removed from his
post. Reuters on 13 May reported that the board was widely expected to
call for Avramovic's ouster, a move that would presumably have brought
the issue of Avramovic's position up for discussion in the federal
parliament and led to his formal dismissal. Avramovic said in response
to the developments: "Either my information was wrong or they changed
their minds." Earlier in the day, Avramovic told some 4,000 people at a
workers' demonstration in Belgrade, that he suspected the board and
federal authorities were coordinating efforts aimed at his ouster. --
Stan Markotich

. . . BUT FOR HOW LONG? The rift between Avramovic and the governing
authorities has now emerged as the major topic of open discussion in
local media. Avramovic has clashed with Belgrade over several major
issues including his unwillingness to endorse policies that would result
in rampant inflation, his advocacy of rump Yugoslav membership in
international institutions such as the IMF, and his support of
privatization. However, he remains popular with the public, which Nasa
Borba on 14 May suggested may be enough to compel the government to
"wait until June" before attempting to remove him from office. -- Stan
Markotich

SERBIA DOES NOT ALLOW RETURN OF DEAD REFUGEES' BODIES. Serbian border
authorities have not allowed the return of six Kosovar refugee's bodies
who drowned on 23 April in the Danube after their boat capsized near
Esztergom, KIC reported. The rump-Yugoslav embassy in Budapest, which
was to arrange the paperwork for the bodies' return, refused to assist
the victims' relatives. A total of 16 refugees were on the boat
attempting to cross from Hungary into Slovakia. Two of the refugees are
still missing. -- Fabian Schmidt

BRITISH DIPLOMAT CALLS FOR KOSOVO TALKS. British Belgrade ambassador
Ivor Roberts has called on rump Yugoslavia to enter talks with the
Kosovo shadow state government, AFP reported on 12 May. Roberts argued
that "Belgrade should make the first step . . . because it has the power
and should try to create an atmosphere of confidence." He said that "the
borders of the Federal Republic of Yugoslavia cannot be changed
unilaterally," and called on the Albanians to end their boycott of the
Serbian administration and participate in the region's political life.
Shadow state President Ibrahim Rugova meanwhile repeated his demand for
international mediation and pointed out that it is Belgrade's turn to
start talks. In other news, a Serbian policeman and an ethnic Albanian
were wounded in a shoot-out in Pristina on 11 May. Police claim the
Albanian was a criminal who opened fire to escape arrest. -- Fabian
Schmidt

ILLEGAL PHONE-TAPPING SCANDAL IN ROMANIA. At a press conference in
Bucharest of the extremist Greater Romania Party (PRM) on 13 May, a
captain on the staff of the Romanian Intelligence Service (SRI) played
illegally taped conversations of politicians and other personalities of
public life, the media reported on 14 May. For some time now, the PRM
leader, Corneliu Vadim Tudor, has been accusing the director of the SRI
of such practices. Vasile Vacaru, chairman of the parliamentary
committee overseeing the activities of the SRI said this was "very
grave" and investigations will immediately be started. Other observers,
however, stress that the captain, Constantin Bucur, declined to say
whether Magureanu, Director of the Romanian Intelligence Service, had
authorized the taps and point out that Tudor is surrounded by many
discontent former and present SRI members who might have tapped the
conversations themselves in order to discredit Magureanu. -- Michael
Shafir

ROMANIAN PARLIAMENT REJECTS OPPOSITION MOTION. The Chamber of Deputies
on 13 May rejected a motion by the opposition to debate failures in the
government's policies that led the IMF to suspend a stand-by loan after
the Nicolae Vacaroiu cabinet failed to implement the loan agreement,
Radio Bucharest reported the next day. The premier told the chamber that
the "essential purpose" of the memorandum signed with the IMF has been
attained given a "spectacular drop" in inflation and consistent
improvement in the country's foreign currency reserves. -- Michael
Shafir

BULGARIAN SOCIALIST PARTY PLENUM SUPPORTS STRUCTURAL REFORM. A Bulgarian
Socialist Party plenum over the weekend voted in favor of accelerating
structural reform, including liquidating 70 enterprises whose combined
losses are 127.5 billion leva ($1.16 billion) and which employ 40,000
people, Pari reported on 13 May. The plenum supported Premier Zhan
Videnov's proposal to privatize the Sodi Devnya chemical works despite
the objections of Minister of Industry Kliment Vuchev. Observers suggest
this means that Videnov is on his way out. Former Premier Andrey Lukanov
lauded the plenum's decisions but remarked that they should have been
made six years ago. The additional 40,000 unemployed will add 1.1% to
the unemployment rate, which Pari currently puts at 12.5%. The plenum
supported compensating these individuals, with the amount to be decided
within two weeks. -- Michael Wyzan

UPDATE ON BULGARIA'S FINANCIAL CRISIS. Bulgaria's currency, the lev, has
lost some 70% of its value since the beginning of 1995, plunging the
country into one of its worst crises since the fall of the communist
regime. Premier Zhan Videnov on 10 May urged the parliament to pass laws
that would shore up the banking system, guarantee deposits, and affect
badly needed privatization measures that the cabinet enacted on 12 May.
Videnov announced that unproductive state-owned factories would be shut
down, with workers receiving cash payment compensations. Meanwhile,
Bulgarian dailies speculate that the economy is on the brink of
hyperinflation. -- Stan Markotich

AUSTRIAN FOREIGN MINISTER PLEDGES SUPPORT FOR ALBANIA'S EUROPEAN
INTEGRATION. Wolfgang Schuessel said Austria will continue to support
Albania's transition to democracy and efforts for integration into
Europe, Republika reported on 11 May. During his one-day visit,
Schuessel discussed economic cooperation and the Kosovo crisis with
Albanian President Sali Berisha, Prime Minister Alexander Meksi, and
Foreign Minister Alfred Serreqi. Austria's main investments in Albania
include one large hotel in Tirana's center and the Austrian firm OMV's
oil drilling in the region. Austrian aid to Albania in the past three
years amounted to $16 million. Schuessel also called for an
internationally mediated dialogue in Kosovo. -- Fabian Schmidt

[As of 12:00 CET]

Compiled by Deborah Michaels

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            Copyright (c) 1996 Open Media Research Institute, Inc.
                      All rights reserved. ISSN 1211-1570
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