Words that open our eyes to the world are always the easiest to remember. - Ryszard Kapuscinski
OMRI DAILY DIGEST

No. 35, Part I, 19 February 1997


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 OMRI Daily Digest, and other information about OMRI, are
available through OMRI's WWW pages: http://www.omri.cz/Index.html

========================================================================
In the 21 February issue of OMRI's journal, TRANSITION:

DISSIDENTS -- THEN AND NOW
- Reshaping Dissident Ideals for Post-Communist Times
- How Rude pravo 'Helped' Get Charter 77 off the Ground
- In Poland, A Long-Standing Tradition of Resistance
PLUS...
- CENTRAL ASIA: The Gordian Knot of Energy
- BOSNIA-HERZEGOVINA: Janusz Bugajski on Stabilizing Partition with SFOR
- VIEWPOINT: Vladimir Shlapentokh on Creating 'The Russian Dream' After
Chechnya

For subscription information about OMRI's new monthly, send an e-mail
message to transition@omri.cz
========================================================================

RUSSIA

JOURNALIST PUNISHED AFTER REPORT ON YELTSIN WIFE. Presidential spokesman
Sergei Yastrzhembskii not only denied the report that President Boris
Yeltsin's wife Naina asked him to step down for health reasons but also
revoked the accreditation of Komsomolskaya pravda's journalist Aleksandr
Gamov, whose report gained wide publicity throughout Russia, AFP
reported on 18 February (see OMRI Daily Digest, 18 February 1997). Gamov
admitted that he was simply spreading rumors. Other members of the
Russian media expressed surprise at the drastic measures taken against
him. Meanwhile, State Duma Speaker Gennadii Seleznev said Yeltsin's
postponement of his annual address to the Federation Assembly has
violated the constitution and complicated parliamentary and governmental
work, NTV reported on 18 February. -- Nikolai Iakoubovski

KINKEL VISITS MOSCOW . . . German Foreign Minister Klaus Kinkel met
Presidential Chief of Staff Anatolii Chubais and Foreign Minister
Yevgenii Primakov on 18 February, agencies reported. The two sides
concurred that Russia and NATO should sign an agreement before the NATO
Madrid summit in July, at which the decision to accept new members is
expected to be made. However, Russia is insisting on signing a legally
binding treaty with NATO, which the latter resists. Reuters reported
that Kinkel will not be given the opportunity to meet President Yeltsin
during his two-day visit. Yeltsin did meet Palestinian leader Yasser
Arafat on 18 February, however. Meanwhile, Russian Foreign Ministry
spokesman Vladimir Andreev said recent Polish reports of a covert
Russian anti-NATO campaign were "absolutely groundless." -- Peter
Rutland

. . . ALBRIGHT IN BRUSSELS. U.S. Secretary of State Madeleine Albright
told NATO's North Atlantic Council in Brussels on 18 February that an
accelerated timetable should see accession agreements signed with new
NATO members by December of this year. Albright also announced several
new concessions to Russia, such as a willingness to set country by
country limits within the 1990 CFE treaty and a joint Russian-U.S.
peacekeeping brigade. The day before, when Albright was in Germany,
Kinkel affirmed German support for the French proposal for an April
five-power summit with Russia, Britain, and the U.S. to seek agreement
with Russia about NATO expansion. The U.S. is opposed to such a summit.
-- Peter Rutland

U.S. TO INVESTIGATE COMPUTER SALE. The U.S. Commerce Department is
investigating the sale to Russia of supercomputers to be used for
simulating nuclear tests, AFP and the Wall Street Journal reported on 19
February. Atomic Energy Minister Viktor Mikhailov announced the purchase
of four supercomputers on 13 January. A Silicon Graphics spokesman
confirmed that his company sold the machines but said the firm thought
they were going to a pollution monitoring laboratory and not to nuclear
warhead design institutes. Meanwhile, Deputy Atomic Energy Minister
Yevgenii Reshetnikov confirmed on 18 February that Russia will sell a
nuclear reactor to Cuba, and said that the U.S. is only objecting
because it wants to keep Russia out of the international market for
nuclear power stations. He also said that the U.S. firm Westinghouse had
been invited to join the project - something which U.S. law would not
allow. -- Peter Rutland

ILYUKHIN PUSHES YELTSIN TO FIRE BEREZOVSKII. Duma Security Committee
Chairman Viktor Ilyukhin has redoubled his efforts to pressure President
Boris Yeltsin into firing Security Council Deputy Secretary Boris
Berezovskii. Ilyukhin wants Berezovskii removed on the grounds that he
lied about his Israeli citizenship, lacks professional experience in
handling security matters, and continues to engage in business
activities while performing his state duties, Komsomolskaya pravda
reported 19 February. NTV seemed to support the anti-Berezovskii effort
by broadcasting a critical report on him, including comments from
hardline Russian nationalist leader Aleksandr Sterligov noting that
Berezovskii's position in the administration helps him attract more
support for his political activities. -- Robert Orttung

IS A MILITARY COUP IN PREPARATION? Col. Viktor Baranets, deputy press
spokesman for the Defense Ministry, is publishing his 2,000 page memoirs
on goings-on at the ministry, Komsomolskaya pravda reported on 18
February. Last week, the tabloid Sovershenno sekretno published excerpts
from the diaries, in which Baranets discussed ways to assassinate
President Yeltsin. Baranets, who plans to leave the army, was demoted
from his position as chief press spokesman in the wake of the
controversy over the abortive firing of Ground Forces Commander Vladimir
Semenov (see OMRI Daily Digest, 3 December 1996). When asked whether a
coup was likely in Russia, Baranets commented: "I have had occasion to
study the history of military coups in various countries of the world,
and have analyzed our generals from this point of view. My conclusion is
that the likelihood of a 'coup from the top' is extremely small in
Russia today." -- Peter Rutland

YELTSIN CONFIRMS MANPOWER CUTS IN ARMED FORCES. President Yeltsin on 18
February ordered Defense Minister Igor Rodionov to reduce the size of
the armed forces by 200,000 men by the end of the year, ITAR-TASS
reported. The establishment strength of the armed forces is currently
1.7 million. Yeltsin also ordered the government to set aside funds to
carry out the force reduction and provide social benefits to soldiers
facing unemployment. Rodionov estimated that the cuts would cost about
10 trillion rubles. The reduction was first announced at a joint press
conference given by Rodionov and Defense Council Secretary Yurii Baturin
on 7 February (see OMRI Daily Digest, 10 February 1996). -- Penny
Morvant

CONSTITUTIONAL COURT RULES AGAINST GOVERNMENT ON ALCOHOL LICENSES. In a
sharp blow to the budget and a victory for business, the Constitutional
Court on 18 February found unconstitutional a government edict of 28
February 1995 requiring firms to purchase licenses to produce, store, or
sell alcohol on the wholesale market, Kommersant-Daily reported. The
court said it is the prerogative of the parliament to pass tax
legislation. The case was brought by the legislatures of Dagestan,
Stavropol Krai, and Tula Oblast. Dagestan argued that the edict further
hampered the republic's wine producers, who, it claims, have already
suffered as a result of other federal policies. In order to minimize its
impact on the budget, the ruling will not come into effect for six
months. The court also instructed the Federal Assembly to consider
legislation on license fees. It is far from certain, however, that the
parliament will pass the required law before the six-month grace period
is up. -- Penny Morvant

GAZPROM TRIES TO BLOCK SHARE TRADING. Gazprom chairman Rem Vyakhirev has
called for the closure of the Cayman Islands-based Regent Gaz Investment
Company, Nezavisimaya gazeta reported on 18 February. The Regent company
is offering international investors a fund backed by $200 million worth
of Gazprom shares, which are being bought by a Russian subsidiary,
Rastri. Gazprom shares cannot be sold to foreigners without Gazprom's
permission, but they are traded on the Russian domestic market. Last
October, Gazprom made $429 million worth of shares available to
foreigners last October, through the issue of American Depositary
Shares, and they trade at four times the Russian domestic share price.
-- Peter Rutland

RUSSIAN OFFICIALS ON FIGHTING TAX EVASION. Deputy Prime Minister
Anatolii Kulikov said that although the government has no control over
flows of financial resources, no emergency measures will be introduced
to fight tax evasion, ITAR-TASS, NTV and Segodnya reported on 18-19
February. Kulikov said he will concentrate on coordinating the work of
the tax police, the tax service, and the customs committee. Meanwhile, a
top tax service official, Vladimir Popov, said that the authorities
intend to transfer the accounts of large taxpayers to the most reliable
commercial banks authorized to work with governmental accounts,
Kommersant-Daily reported on 18 February. Although the measure can
reduce delays in payment, it is likely to provoke another round of war
among banks for large clients. At present, tax arrears due to delays in
payment via commercial banks total 3 trillion rubles. -- Natalia
Gurushina

CAPITAL FLIGHT FROM RUSSIA. The total volume of capital flight from
Russia over the last five years is estimated at some $60 billion,
Finansovye izvestiya reported on 18 February, citing a former partner in
the Moscow branch of Coopers & Lybrand. Most of the money was deposited
in banks in Switzerland and Cyprus. Some 41,000 industrial companies,
50% of banks, and over 80% of joint ventures are believed to have
criminal connections. The shadow economy is estimated to account for up
to 40% of the Russian economy. -- Natalia Gurushina

TRANSCAUCASIA AND CENTRAL ASIA

ARMENIAN PARLIAMENT ADOPTS 1997 BUDGET. Following more than two months
of debate, the Armenian National Assembly on 18 February adopted the
1997 budget, international media reported. The budget envisages
expenditures of 151.9 billion drams ($325 million) with 30.5 billion
drams to be spent on defense needs and 16.8 billion allocated for social
welfare. According to Reuters, the budget projects a 10.5% inflation
rate in 1997, and practically all of its 33.9 billion dram deficit will
be covered by international financial institutions. Addressing the
parliament, President Levon Ter-Petrossyan described it as a "budget of
survival but not a budget of development." The Communist Party was the
only faction that voted against the draft. The two other parliamentary
opposition parties, the National Democratic Union and the National Self-
Determination Union, have been boycotting the legislature since the 25
September post-election unrest. -- Emil Danielyan

ARMENIAN OPPOSITION PARTIES TO FORM "UNITED FRONT." A round table
discussion involving the main Armenian opposition parties decided on 17
February to form a "united front" against the current government and to
convene the new movement's founding congress soon, Noyan Tapan reported.
According to the opposition leaders, the movement's only goal is to
"establish democracy in Armenia." In particular, this involves holding
fresh presidential, parliamentary, and local elections and adopting a
new constitution. David Vartanyan, a representative of the National
Democratic Union, said that the new organization will include Armenian
NGOs and distinguished individuals who are unhappy with the current
regime. Meanwhile, during a mass rally in Yerevan on 18 February to mark
the 76th anniversary of the 1921 anti-Bolshevik revolt, the opposition
reiterated its claims that the "illegitimacy of the Armenian leadership"
is hindering a solution to the country's pressing problems. -- Emil
Danielyan

REGIONAL UZBEK BOSS ANSWERS TO POOR ECONOMIC PERFORMANCE. Mirzajon
Islamov was removed from his post as administrative head of the Ferghana
Wilayat on 14 February, Narodnoe slovo reported on 15 February. In a
meeting chaired by Uzbek President Islam Karimov, Islamov was accused of
"no longer answering the needs of the time," a charge levied against
other regional hokims in 1996 (see OMRI Daily Digest, 17 December 1996).
The president considered the pace of privatization and economic reform
to have been too slow, noting that only 35 out of 73 registered joint
ventures in the region were still in operation. In addition, light
industries were operating at only 50% capacity and agricultural harvests
for 1996 were a disappointing 77% of the required quota. His successor
is Numonjon Mominov, a district head of administration from the same
Ferghana apparatus as Islamov. -- Roger Kangas

UZBEKISTAN PROTESTS ATTACK ON CUSTOMS OFFICERS. The Uzbek Foreign
Ministry protested to Dushanbe after three Uzbek customs officers were
wounded in a 15 February attack on their outpost in Besharik, RFE/RL
reported on 18 February. Uzbek authorities believe the assault from
Tajik territory was well-planned and designed to aggravate tensions
between the Leninabad region of Tajikistan and adjacent Uzbek areas.
This is the second such incident to occur this year. -- Lowell Bezanis

TURKMEN UPDATE. Turkmen President Saparmurat Niyazov and Barnea Eli,
president of the Dutch subsidiary of the Israeli concern Bateman, signed
a $180 million deal to modernize Turkmenistan's aging pipeline system,
RFE/RL reported on 19 February. The U.S. and South Africa are to provide
capital for the undertaking. -- Lowell Bezanis

TURGUNALIEV TRIAL UPDATE. The Supreme Court of Kyrgyzstan changed the
verdict handed down by a Bishkek municipal court to Topchubek
Turgunaliev on embezzlement charges early last month, RFE/RL reported on
18 February. The Supreme Court reduced a 10-year prison term to a three-
year suspended sentence and one year deportation to the Issyk-Kul
region; the other defendant in the case, Timur Stamkulov, had his
sentence reduced from six to three years. Turgunaliev's lawyers declared
their intention to appeal the latest decision in Kyrgyzstan's
Constitutional Court. In other news, the presidential administration of
Kyrgyzstan was shrunk by a 14 February presidential decree from 127 to
89, RFE/RL reported the same day. -- Naryn Idinov

TAJIKISTAN OPPOSITION ON HOSTAGE TAKING. The Russian intelligence
service and the Tajik government orchestrated the recently concluded
hostage taking crisis in Tajikistan in an attempt to bring another group
into the inter-Tajik talks and set it against the opposition, according
to a clandestine Tajik opposition radio report by the BBC monitored 15
February Interfax report. According to a Russian media report issued
immediately after the hostages were released, Tajik Presidential Press
Secretary Zafar Saidov was quoted as saying the Sadirov brothers
declared their "loyalty" to Tajik President Imomali Rakhmonov and did
not lay claim to the status of a "third force" in the Tajik peace talks.
The next round of talks is scheduled to take place later this week in
Meshed, Iran. -- Lowell Bezanis

[As of 12:00 CET]

Compiled by Victor Gomez

------------------------------------------------------------------------
            Copyright (c) 1997 Open Media Research Institute, Inc.
                      All rights reserved. ISSN 1211-1570
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