Искренность отношений, правда в обращении - вот дружба. - А. В. Суворов
OMRI DAILY DIGEST

No. 172, Part I, 5 September 1996

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

RUSSIA

CHECHEN POLITICAL PARTIES DISCUSS PREPARATIONS FOR NEW ELECTIONS.
Meeting on 4 September in the village of Noviye Atagi south of Grozny,
representatives of various Chechen political parties and OSCE
representative Tim Guldimann discussed preparations for a January
parliamentary election in Chechnya, ITAR-TASS reported. Chechen head of
state Doku Zavgaev, speaking from Moscow, said that no parallel
government may be formed in Chechnya before that election takes place.
Many members of Zavgaev's government have already resigned in order to
avoid impeding the peace process. Chechen Chief of Staff Aslan Maskhadov
appealed to the population of Chechnya to refrain from ostentatious
demonstrations on 6 September to mark the fifth anniversary of the
advent to power of late President Dzhokhar Dudaev. On 3 September,
Chechen separatist spokesman Movladi Udugov denied claims by Russian
military sources that acting President Zelimkhan Yandarbiev's supporters
are planning to hold a military parade in Grozny on 6 September. -- Liz
Fuller

CHUBAIS CAUTIOUS ON LEBED PEACE PLAN . . . While President Boris Yeltsin
has not publicly commented on Security Council Secretary Aleksandr
Lebed's Chechen peace plan, presidential Chief of Staff Anatolii Chubais
said that the plan needs serious analysis, NTV reported on 4 September.
Chubais praised the current lull in the fighting but said that the plan
should be treated with caution. He said that it is neither a
capitulation--as Moscow Mayor Yurii Luzhkov has charged--nor grounds for
calling Lebed a "national hero," Russian TV reported. He noted, however,
that Prime Minister Viktor Chernomyrdin's positive appraisal of the plan
was "just." Chubais reiterated his commitment to "preserving the
integrity of the Russian state" and stressed that Chechnya is not a
country. Chubais implicitly criticized Lebed, who has been dismissive of
Doku Zavgaev's pro-Moscow Chechen government, by saying that "we cannot
pretend that Zavgaev's government doesn't exist. -- Robert Orttung

. . . SAYS MORE INFORMATION FORTHCOMING ON YELTSIN'S HEALTH. Chubais
admitted that the lack of information on Yeltsin's health has created
conditions for speculation and rumors. He said that the administration
would begin to release more information about the president's condition,
and hinted that there would be important announcements soon, Russian
Public TV (ORT) reported. He claimed that Yeltsin would emerge from his
vacation "as energetic as [he was] during the campaign," ITAR-TASS
reported. -- Robert Orttung

NEW BLOC TO BACK LEBED. The "centrist" political bloc "For Truth and
Order," will be established on 5 September to support Security Council
Secretary Lebed, maintain constitutional order in the country, fight
crime and corruption, and ensure the country's economic security, ITAR-
TASS reported. Lebed's political allies, the Congress of Russian
Communities (KRO) and the Democratic Party of Russia (DPR), will join
the bloc and their leaders Dmitrii Rogozin and Sergei Glazev will serve
as its co-chairmen. Lebed's role in the bloc is unclear, although his
Honor and Motherland group will join, Ekho Moskvy reported. Although the
KRO did not cross the 5% threshhold in the December State Duma election
and the DPR has suffered several splits, "For Truth and Order" intends
to participate actively in the local elections scheduled for this
autumn. -- Ritsuko Sasaki

COMMUNISTS PESSIMISTIC ON CHECHNYA PROSPECTS. . . Communist Party (KPRF)
leader Gennadii Zyuganov repeated his call for parliament's upper house,
the Federation Council, to convene an emergency session on the Chechnya
crisis, saying it should not "remain on the sidelines concerning
questions affecting Russian territorial integrity," Russian media
reported on 4 September. The State Duma, where deputies sympathetic to
Zyuganov enjoy a majority, has not moved to call a special session on
the matter. A KPRF statement noted that when fighting first escalated in
Chechnya in December 1994, the government said it aimed to restore
constitutional order and disarm "bandits." Instead, the Lebed-Maskhadov
agreement was "a political and moral defeat," tantamount to handing over
Chechen territory to "bandit formations." The KPRF also questioned
Lebed's authority to sign the document, ORT reported. -- Laura Belin

...BUT UPBEAT ON GUBERNATORIAL ELECTIONS. Zyuganov and Duma deputy
Valentin Kuptsov, the number two figure in the KPRF, predicted that
left-wing opposition candidates from the Popular-Patriotic Union of
Russia would win the 22 September gubernatorial election in Amur Oblast,
as well as races in Rostov and Leningrad oblasts set for 29 September,
ITAR-TASS reported on 4 September. Commenting on the 1 September
gubernatorial election in Saratov Oblast, where Communist challenger
Anatolii Gordeev gained just 16% of the vote against 82% for the
incumbent Dmitrii Ayatskov, Zyuganov praised Ayatskov's professionalism,
Kommersant-Daily reported. According to Izvestiya on 5 September, some
disappointed KPRF activists blame the Saratov result on the party
leadership's "passivity" in recent weeks concerning the Chechen crisis.
Zyuganov did not outline his stance on the peace talks until 3
September, days after the Lebed-Maskhadov agreement was signed. -- Laura
Belin

$2.5 BILLION SPENT ON RENOVATION IN MOSCOW. Moscow Deputy Mayor
Aleksandr Muzykantskii has announced that some $2.5 billion is spent on
renovations in the city every year, ITAR-TASS reported on 4 September.
He said the bulk of that money comes from private investors. About 600
buildings in the city have been renovated in recent years and local
officials are hoping to have the downtown core completed by next
September, when Moscow will celebrate its 850th anniversary. -- Anna
Paretskaya

PRIMAKOV MEETS KINKEL IN BONN. On his first trip to the West since being
appointed in January, Foreign Minister Yevgenii Primakov met with German
Foreign Minister Klaus Kinkel on 4 September. While neither side changed
its stance on NATO expansion, they agreed to hold talks on defining
Russia's relationship with the alliance, Reuters reported. Additionally,
the two sides will work to strengthen the OSCE at that organization's
summit scheduled for December. -- Robert Orttung

MORE DENUNCIATIONS OF U.S. ATTACKS AGAINST IRAQ. The Russian government
issued a second official statement condemning the U.S. missile strikes
against southern Iraq, accusing the U.S. of trying to "replace the
Security Council, which under the UN Charter holds the exclusive right
to authorize the use of force," Russian and Western agencies reported on
4 September. Presidential Chief of Staff Chubais said President Yeltsin
fully concurred with the government statement, ITAR-TASS reported.
Speaking from Liechtenstein and later from Germany, Foreign Minister
Yevgenii Primakov warned that the U.S. missile strikes against southern
Iraq were a "dangerous precedent" and could lead to "anarchy in
international relations," Reuters reported. Meanwhile, Communist Party
leader Gennadii Zyuganov agreed with Primakov's remarks and criticized
the U.S. for attempting to be "the world's policeman," while the Duma
Foreign Affairs Committee denounced U.S. attempts to "settle the score"
with Iraqi leaders. -- Laura Belin

CRISIS IN IRAQ SEEN HURTING RUSSIAN ECONOMIC INTERESTS. Deputy Foreign
Minister Viktor Posuvalyuk noted that the U.S. missile strikes against
Iraq will significantly damage Russian economic interests, ORT reported
on 4 September. He said Iraq owes the Russian government more than $7
billion, which it will not be able to repay until the UN embargo against
Iraq is lifted. In addition, the crisis will delay Russian companies'
plans to help rebuild Iraq's oil infrastructure once normal trade
resumed. The press service of the oil giant Lukoil, which stands to gain
from such projects, told Kommersant-Daily on 5 September that it fully
agrees with government statements condemning the U.S. attacks against
Iraq. -- Laura Belin

SWEDES ACCUSED OF SPYING. NTV on 4 September showed a videotape of the
arrest of a Swedish man, Hans Peter Nordstrem, who met a Russian contact
in the Naval Museum in St. Petersburg in February and handed over $2,000
in return for a matrioshka doll containing a microfilm with sensitive
defense information. Sergei Gorlenko, a Federal Security Service
official, said that as a sign of goodwill, Nordstrem was expelled from
the country rather than prosecuted. Gorlenko claimed that the Swedish
secret service has been very active, using businessmen to gather
information about security issues, particularly connected to the navy.
According to Reuters, another Swede, a senior diplomat in Moscow, was
also expelled for spying. The Swedish Foreign Ministry has refused to
comment. -- Peter Rutland in Moscow and Penny Morvant

CONSUMER PRICES FALL FOR FIRST TIME. Consumer prices fell by 0.2% in
August in comparison with July, the first drop since economic reforms
began, ITAR-TASS reported on 4 September citing Goskomstat. Food prices
fell by 1.7% while consumer goods prices were up 1.1% and the price of
consumer services up 2.7%. Some observers believe that the fall in
prices is due to the increase in wage arrears, which is dampening
demand. Since the beginning of the year, consumer prices have risen by
16.1%, with food prices up 13.1%, prices for non-food goods up 13.2%,
and the price of consumer services up 35.7%. Inflation in July was 0.7%.
-- Penny Morvant

CRISIS CONTINUES IN PRIMORE. Energy workers in Primore, who are
protesting continuing wage arrears, called on 4 September for the
resignation of Primorskii Krai Governor Yevgenii Nazdratenko and his
administration and the introduction of direct presidential rule, NTV and
ORT reported. The workers did not, however, support the call of the
krai's Duma for a regional referendum on 22 September on confidence in
Nazdratenko, who was elected in December 1995 with 90% of the vote (see
OMRI Daily Digest, 30 August 1996). The governor himself blamed the
crisis in the fuel and energy sector, which has resulted in new labor
disputes and power cuts to customers, on the introduction of higher
energy prices in Primore following the July crisis there. On local
television he contended also that the power workers' call was motivated
by his decision to conduct an independent audit of their employer,
Dalenergo. -- Penny Morvant and Anna Paretskaya

SPENDING CUTS WERE KEY TO STABILIZATION. Maksim Boiko, deputy chief of
staff in the presidential administration, said at a 4 September seminar
in the New Economic School that economic stabilization has been a
success and that he expects economic growth "very soon." Boiko, formerly
chief aide to Anatolii Chubais when the latter was first deputy prime
minister in charge of economic reform, attributed the success of
stabilization to the tight monetary and fiscal policies introduced in
1995. He conceded that revenue from taxes and from the sale of treasury
bonds (GKOs) was lower than expected, which meant that the stabilization
was achieved thanks mainly to a reduction in federal government
spending, which was only 17% of GDP in 1995, against a planned level of
27%. A similar pattern is unfolding in 1996. -- Peter Rutland in Moscow

GOVERNMENT MEMBERS ON CONTROVERSIAL TAX DECREE. Prime Minister Viktor
Chernomyrdin's press secretary, Viktor Konnov, told ITAR-TASS on 4
September that the government intends to amend a controversial 18 August
presidential decree on personal income tax. The decree caused an outcry
because it appears to subject all bank deposits held by individuals to
income tax (see OMRI Daily Digest, 22 August 1996). Presidential Chief
of Staff Chubais on 4 September also suggested that the decree will be
amended, ORT reported. Chubais said that if the "justified criticism"
the decree has received in the press and the concern it has aroused
among the general public leads to a massive outflow of savings from
commercial banks, then it will be clear that the decree was a mistake.
-- Penny Morvant

TRANSCAUCASIA AND CENTRAL ASIA

ARMENIA IMPOSES RESTRICTIONS ON EMIGRATION OF DRAFT AGE MEN. The
Armenian Defense Ministry has called for closer monitoring of all men
aged 18-30 who wish to leave the country in order to prevent them from
avoiding the draft, Ekho Moskvy reported on 2 September. The call comes
after a 22 August Armenian government decree on drafting first category
reserve officers in September 1996. Armenian officers who graduate from
military academies in Russia are increasingly seeking postings at the
two Russian military bases in Armenia in order to avoid service in
Nagorno-Karabakh, Turan reported on 28 August. Russian-Armenian joint
military maneuvers have been scheduled for 23-27 September, immediately
after the Armenian presidential election, according to Noyan Tapan. --
Liz Fuller

BOMB ATTACK IN GORNO-BADAKHSHAN. A bomb exploded in front of the
regional administration building of Gorno-Badakhshan on 4 September,
ITAR-TASS reported. Russian border guards claimed that local drug rings
planted the bomb as a reaction to an official crackdown on narcotics
trafficking, a curfew in force in some border areas, the tightening of
passport controls, and Russian efforts to cooperate with Afghan border
troops to prevent Tajik opposition from making an incursion from
Afghanistan into Tajikistan. The explosion reportedly occurred minutes
after regional officials and police chiefs had concluded a meeting in
the building. It may have been intended to dynamite Russian efforts to
pacify the Pamir region. -- Lowell Bezanis

RUSSIAN TROOPS OUT OF KAZAKSTAN. Russia is currently withdrawing two
divisions of Strategic Rocket Troops from Kazakstan that had been
stationed in the Turgaisk and Semipalatinsk regions, ITAR-TASS reported
on 4 September. The last Russian strategic missile nuclear warheads were
pulled out of Kazakstan in April 1995. The joint Russian-Kazakstani
commission dealing with the withdrawal met in Almaty on 4 September. In
future meetings, they plan to discuss the work of destroying the SS-18
missile silos and the transfer of military infrastructure and equipment
to Kazakstan. -- Doug Clarke

[As of 12:00 CET]

Compiled by Victor Gomez

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            Copyright (c) 1996 Open Media Research Institute, Inc.
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