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

^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
In the 7 March issue of OMRI's journal, TRANSITION**:

BALKAN UNREST
- Pyramid Schemes Leave Albania on Shaky Ground
- Back to the Basics in Bulgaria
- Protests in Serbia Raise Hopes of Reconciliation in Kosovo
- In Post-Dayton Balkans, Change Comes Where It's Least Expected
PLUS...
- RUSSIA: Chernomyrdin: A Prime Minister Without Politics
- VIEWPOINT: Azerbaijan: Democracy in a State of Emergency

        and "Reviving the Black Sea"

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

**See important message below on the upcoming changes to TRANSITION
^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^

CENTRAL AND EASTERN EUROPE

UKRAINIAN FOREIGN MINISTER ON NATO. Hennadii Udovenko cautioned NATO
against developing ties with Russia at Ukraine's expense, the German
daily the Frankfurter Allgemeine reported on 4 March. He voiced concern
that a NATO-Russia agreement would lead to a new division of spheres of
influence in Europe, with Russia being allowed to dominate the CIS in
exchange for its acceptance of new members into the Western alliance.
Udovenko said Kyiv would like a legally binding agreement with NATO that
would offer security guarantees to Ukraine, but did not believe that
NATO would offer more than consultations. Unlike Russia, Ukraine is not
opposed to NATO expansion, and does not preclude its own membership in
the organization in the future. The same day, ITAR-TASS reported NATO
Secretary-General Javier Solana said NATO should work out its
relationship with Ukraine before the July summit in Madrid. -- Ustina
Markus

ZVYAHILSKY RETURNS TO UKRAINE FROM ISRAEL. Former Ukrainian acting prime
minister and current member of the parliament, Yukhym Zvyahilsky,
returned to his home city of Donetsk after more than two years in
Israel, international agencies reported on 4 March. Zviahilsky fled to
Israel in 1994, facing accusations of embezzling $25 million through the
illegal sale of aviation fuel and foreign exchange operations. He
rejected the allegations, accusing the former prosecutor general of
political revanchism. The Ukrainian parliament restored Zvyahilsky's
parliamentary immunity last month, but the prosecutor's office said the
investigation against him is not finished. In Donetsk, Zvyahilsky told a
miners' rally he will continue to sit in parliament but will never take
an official post in Kyiv. -- Oleg Varfolomeyev

BELARUSIAN CONSTITUTIONAL COURT SWORN IN. The new Constitutional Court,
appointed after the November constitutional referendum, was sworn in on
4 March, Belarusian radio and NTV reported. The court is made up of 11
justices, six of whom were president's appointees, including Chief
Justice Ryhor Vasilevich. Four of the justices had served on the
previous Constitutional Court. President Alyaksandr Lukashenka presided
over the ceremony, and gave each justice a copy of the new constitution
with his autograph. A number of journalists were not allowed into the
ceremony. -- Ustina Markus

BELARUSIAN PRESIDENT CALLS FOR SEPARATE DEAL WITH NATO. Alyaksandr
Lukashenka unexpectedly called for a separate deal between NATO and
Belarus, international agencies reported on 4 March. Lukashenka voiced
concern that Belarus was being sidetracked and isolated in talks about
European security. He said only European states could establish a new
order in Europe, and that should be done without the participation of
countries from "across the ocean." The reference was directed against
the U.S., which has downgraded its ties with Belarus to a minimal level.
Lukashenka had been an ardent opponent of NATO expansion, and his call
for a dialogue may have been prompted by NATO's separate talks with
Russia and Ukraine. NTV speculated the sudden initiative may also be a
way of forcing Russia to take more serious steps toward integration with
Belarus. -- Ustina Markus

HUNGARIAN PRESIDENT IN LITHUANIA. Arpad Goncz, accompanied by about 30
businessmen, began an official three-day visit to Lithuania on 4 March
with talks with President Algirdas Brazauskas, Radio Lithuania reported.
Interior Minister Vidmantas Ziemelis and Hungarian Interior Ministry
Political Secretary Gabor Vilagos signed an agreement on combating
terrorism, drug trafficking, and organized crime. Goncz assured Seimas
Chairman Vytautas Landsbergis of Hungary's support for Lithuania's
efforts to join NATO and the EU and said that a free trade treaty
between the two countries will be signed within two months. The
businessmen are holding talks with Lithuanian manufacturing and trading
firms. -- Saulius Girnius

POLISH GOVERNMENT ON SCREENING LAW. The Polish government criticized on
4 March the Sejm's draft lustration (screening) law, Polish media
reported. The draft includes the obligation for people occupying
important state posts and candidates for those posts to state whether
they were employees or collaborators of communist secret services in
1944-1990. The statements will be verified by a lustration court.
According to Marek Sadowski, a Justice Ministry official, the law should
provide a more precise definition of collaboration and should
distinguish between a willing collaboration and collaboration under
duress. The lustration court, he added, would combine too many
functions: conduct investigations and be a prosecutor's office; which
reminds one of inquisition procedures, said Sadowski. Andrzej
Rzeplinski, the Sejm's expert on lustration, defended the draft. He
reminded that the lustration court would make public its judgment only
in the case a statement proves to be false. -- Jakub Karpinski

POLISH SENATE ON POLES ABROAD. Senate Speaker Adam Struzik, opening the
Senate debate on 4 March, said that Polish citizens living abroad should
have the right to vote in parliamentary elections and in both rounds of
presidential elections (they currently do not have the right to vote in
the second round of presidential elections). The Senate is scheduled to
vote today on a statement calling on the authorities for "restitution of
Polish citizenship to all our compatriots who wish it, particularly in
the East." -- Jakub Karpinski

CZECH DEFENSE MINISTRY DENIES IT LOST NATO DOCUMENTS. The Czech Defense
Ministry announced on 4 March that it had not lost any NATO documents,
Czech media reported. Various media reports had alleged that the
ministry was unable to find 100 of the 700 documents that NATO started
giving to Partnership for Peace countries in 1994. "We have not lost any
documents. We are not missing any ^é Reports alleging we lost any
documents were misleading," Defense Minister Miloslav Vyborny told
journalists on 4 March. However, Mlada Fronta Dnes quoted various army
officials as saying that the ministry did not know where various
documents were and began looking for them only after media reports
alleged they were lost. -- Jiri Pehe

SLOVAK REACTIONS TO HUNGARIAN ARGUMENTS IN THE HAGUE. Peter Tomka, head
of Slovakia's delegation in that country's dispute with Hungary at the
International Court of Justice in The Hague, on 4 March criticized the
Hungarian arguments, TASR reported. At the close of the second day
during which Hungary presented its case, Tomka said the Hungarian
delegation seems to be trying to convince the court "on the basis of
forecasts and probabilities," while "the decision must be based on legal
norms and proven facts." Julius Binder, the director of the firm that
built the Gabcikovo dam, told Slovak Radio that the Hungarian statements
made before the International Court of Justice constituted
"demagoguery." He accused Laszlo Valki, one of the Hungarian
representatives in the case, of "irredentism," saying he wants to annul
the post-war Paris treaty that delineated the Slovak-Hungarian border.
-- Sharon Fisher

HUNGARIAN PARLIAMENT ACTS ON HOLOCAUST VICTIM COMPENSATION. Parliament
on 4 March acted to implement the 1947 Paris Peace Treaty's call for
compensation for Holocaust victims and authorized the government to
deposit 4 billion forints ($46.5 million) worth of compensation coupons
at nominal value, Hungarian media reported. The coupons, convertible to
life annuity, will be managed by a public foundation that was recently
established to compensate the Jewish community. Life annuity will be
available for Jews who are over 60 years old, are Hungarian citizens and
are permanent residents of Hungary. Three opposition parties -- the
Christian Democrats, the Young Democrats and the Democratic Forum --
abstained from voting. Forum politicians contended that the bill does
not exclude former members of the state security office AVH and those
members of the law enforcement agencies who helped crush the 1956
revolution. -- Zsofia Szilagyi

SOUTHEASTERN EUROPE

ALBANIA ON THE BRINK OF CIVIL WAR? According to eyewitness reports,
tensions and violence continue unabated throughout southern Albania.
Citizens have ignored a curfew and appear bent on venting frustration
against President Sali Berisha's government. Armed civilians on 5 March
fought with army forces in Fiari, a village some ten kilometers outside
Sarande. At least four people have been injured in the incident, AFP
reported, citing Greek television. The fighting reportedly broke out
when four military trucks arrived in the village and soldiers deployed.
Civilians then attacked the military personnel with automatic weapons
and grenades. For his part, Berisha met with political opponents on 4
March in order to resolve the crisis, but government sources have
publicly admitted that the port cities of Vlora and Sarande remain
firmly out of government control. Security forces deployed from Tirana
have orders to shoot on sight those failing to surrender their arms. --
Stan Markotich

ALBANIAN PRESIDENT UNDER FIRE. Sali Berisha is coming under increasing
international criticism for his handling of the domestic situation.
Among the most recent critics has been British Foreign Secretary Malcolm
Rifkind, who on 4 March in an interview with BBC radio, said "We are not
prepared to give support when [Berisha] acts in an authoritarian and
dictatorial way and that, sadly, has been an increasing feature of his
regime ^é The Albanian government has not been properly respecting either
the rule of law or fundamental democratic principles of free media and
free activity for the opposition." Countries bordering Albania have
voiced their own concerns about the gravity of the domestic Albanian
situation. CNN on 5 March reported that Greece has deployed along its
border with Albania and fears a possible flood of refugees. -- Stan
Markotich

MACEDONIAN ARMY PLACED ON WAR FOOTING. Macedonia has reacted to the
ongoing chaos in southern Albania by putting its military in a state of
war-preparedness, effective from the evening of 2 March, Nova Makedonija
reported on 5 March. The move was motivated by concerns over possible
waves of illegal immigrants pouring in from Albania or armed attacks on
posts along the border. Coincidentally, the UN observer mission closed
one of three posts on the Albania border (near Debar) on 3 March, as
part of a scaling back of the number of its soldiers in Macedonia from
1,050 to 750. All three posts are scheduled for closure, as are three of
the six on the Serbian border. So far there are no signs of an influx of
would-be Albanian refugees; only 124 people tried to enter Macedonia
illegally from Albania in January and February. -- Michael Wyzan

BOMB DAMAGES CATHOLIC CHURCH IN SARAJEVO. A Catholic church in downtown
Sarajevo was rocked by an explosion that damaged windows and nearby cars
on 4 March, international and local media reported. The blast was the
latest in a series of attacks on Catholic churches in the Croat-Muslim
federation that started after the violent incident in Mostar on 10
February. A hand grenade was thrown at another Catholic church and a
convent in Sarajevo, and a church in the central Bosnian town of Gornji
Vakuf was mined and damaged last week. The Bosnian Federation government
announced special police protection of Catholic churches during a period
preceding the visit of Pope John Paul II to Sarajevo. Sarajevo cantonal
police suspended the four officers who were guarding the church damaged
in yesterday's blast. Croatia's Deputy Foreign Minister Hido Biscevic
asked Bosnia's Muslim authorities to stop the pressure and violence
against Croats, Hina reported. -- Daria Sito Sucic

SERBS IN EASTERN SLAVONIA TO FORM PARTY AHEAD OF ELECTIONS. Serbs in
eastern Slavonia will on 5 March form their own political party that
will run in Croatia's local vote scheduled for 13 April, AFP reported,
citing Tanjug. The new Independent Democratic Serb Party (SDSS) will be
based in Vukovar, a major town of this still Serb-held region slated to
revert to Croatia's legal authorities, and registered in Zagreb.
Meanwhile, the UN said that eastern Slavonia Serbs were unlikely to
stage a referendum on their electoral status, because their demand for a
single district had already been rejected by both the Croatian
government and the UN Security Council, Reuters reported on 4 March.
Serbs want the region to have a status of a single territorial unit
within Croatia, but Zagreb wants it divided into two counties. -- Daria
Sito Sucic

SERBIAN HARD-LINER DEFIES PUBLIC OPINION. Dragutin Velickovic, the pro-
Milosevic rector of Belgrade University, on 4 March brushed aside
student demands for his resignation, Nasa Borba reported the following
day. Speaking at a press conference, Velickovic not only openly defied
student protesters by categorically announcing his refusal to leave his
post but also countered with his own demand that the institute heads and
13 faculty deans who openly supported the student demonstrators be
sacked. Student representative Dusan Vasiljevic summed up Velickovic's
press conference remarks with the observation that "the whole thing is
another of Velickovic's sick jokes," Reuters reported. In another
development, Nasa Borba on 5 March reported that the previous day a
group of about 150 student protesters crashed a reception for diplomats
and members of the press hosted by Serbia's new Information Minister
Radmila Milentijevic, chanting "Red Bandits" and at one point forming a
circle around Milentijevic. -- Stan Markotich

SERBIAN RULING PARTIES LAUNCH THEIR ELECTION CAMPAIGNS. The ruling
Socialists and their communist allies in the Yugoslav United Left (JUL)
on 4 March de facto launched their campaign for republican presidential
and parliamentary races to be held later this year (on a date yet to be
determined). It is apparent that the main focus will be on attacks
against the opposition Zajedno parties. A statement issued by the ruling
left, and reported by Tanjug, maintained that the "state will protect
its citizens from all political parties that are financed and instructed
from abroad with the aim to topple the legal authorities and jeopardize
the independence and sovereignty of the country." -- Stan Markotich

KING MIHAI TO LOBBY FOR ROMANIA'S EARLY NATO ENTRY. King Mihai on 4
March pledged to do "all he could to help Romania" in its bid for quick
integration into NATO, Radio Bucharest reported. The former monarch met
President Emil Constantinescu, who asked Mihai to support Romania's
diplomatic efforts in NATO member countries, especially those with
constitutional monarchies. In related news, Italian Foreign Affairs
Undersecretary Piero Fassino on 4 March said in Bucharest that his
country would back Romania's efforts for quick NATO entry, Reuters
reported. According to Fassino, Italy favored a "simultaneous beginning
of talks between NATO and all candidates," in order to avoid "feelings
of exclusion or frustration." Meanwhile, Senate Chairman Petre Roman,
who is paying a visit to Spain, said that Madrid would also like to see
Romania in the first group of countries to be admitted to NATO, Romanian
television reported. -- Zsolt Mato

MOLDOVA AND NATO EXPANSION. Moldova's ambassador to the U.S., Nicolae
Tau, says his country has one major concern about NATO expansion: it
does not want to end up as a buffer zone with Russian troops on its
territory, RFE/RL reported on 4 March citing the Washington Times. The
statement is ill-timed for Romania, which is pressing hard for NATO
membership, but may well serve Russian interests opposing the expansion.
Moldova, though participating in the Partnership for Peace Program, is
not applying for membership and wants to stay neutral. That position was
stressed again by Foreign Minister Mihai Popov in an interview with
Infotag on 4 March. He added that the country's foreign policy under
President Petru Lucinschi will not change, but more emphasis will be
laid on the strive for European integration. -- Michael Shafir

TIRASPOL ATTACKS OSCE MISSION IN MOLDOVA. Moldovan agencies reported on
4 March that the Transdniester delegation to the Joint Control
Commission refused to participate in the commission scheduled meeting in
protest of the position of Donald Johnson, the head of the OSCE mission
to Moldova. At the OSCE Permanent Council meeting in Vienna on 19
February, Johnson said that OSCE representatives do not have free access
to military sites in the security zone; criticized the introduction
there of a modified GRAD truck-mounted rocket- launcher system; reminded
that the Tiraspol authorities had not allowed participation in the
Moldovan presidential election; and came against the intention to sign
the memorandum for long-term settlement of the conflict, which had been
agreed on last year between Chisinau and Tiraspol. Also on 4 March, a
visiting delegation of the CIS Parliamentary Assembly preparing a
conference on conflict settlement in the CIS met with Johnson and
Moldovan officials. -- Michael Shafir

CURRENCY-BOARD PURIST BECOMES ADVISOR TO BULGARIAN PRESIDENT. Steve
Hanke, the world's best known advocate of currency boards, has become an
advisor to Bulgarian President Petar Stoyanov, Pari reported on 5 March.
Hanke advocates a pure form in which the currency is more than 100%
backed by foreign currency and the national bank does not take reserve
deposits from commercial banks nor buy and sell foreign currency with
the public. That form is practiced only in Hong Kong and Brunei, while
Estonia, Lithuania, and Argentina have softer versions. He also
recommends that the lev be tied to the dollar and that the board be
introduced at once and not in stages. Meanwhile, the IMF -- citing the
strengthening lev and the primary budget surplus -- is willing to
provide fresh credits to Bulgaria within two weeks, while the World Bank
is taking a wait-and-see attitude, according to Pari. -- Michael Wyzan

EUROPEAN COMMISSION EMERGENCY GRANT FOR BULGARIA. The European
Commission will make a 1.1 million ECU emergency grant to Bulgaria to
help overcome shortages of food and medical material, RFE/RL and AFP
reported on 4 March. The commission said the aid should help hospitals
cope with the constant rise in prices of medical material, which is no
longer subsidized by the government. Prices in Bulgaria rose by 44% in
January alone, while the overall inflation in 1996 stood at 310%. In
other news, the 20 million ECU from another recently made European
Commission's social assistance grant will be distributed among 500,000
most needy Bulgarians as of 18 March. -- Maria Koinova

[As of 12:00 CET]

Compiled by Sava Tatic

*^!*^!*^!*^!*^!*^!*^!*^!*^!*^!*^!*^!*^!*^!*^!*^!*^!*^!*^!*^!*^!*^!*^!*^!
What's in Store for the magazine Transition

We've learned much in the last two years about what sort of magazine
Transition can be and what role it should play in Central and Eastern
Europe and the former Soviet Union. Of greatest help in this process has
been the advice of readers. Among some of the desired changes are for
Transition to offer even more articles by writers in the region - lively
opinion pieces as well as fact-filled analysis and expanded departments.

Accordingly, Transition will be substantially restructured and
relaunched as a monthly with the issue dated June 1997. The last
biweekly issue will be 6 April, followed by a brief hiatus. All existing
subscriptions will be honored and extended according to the new monthly
frequency, which is priced at $65 for 12 issues. As before, we offer a
substantial discount for readers in and of the countries we cover (apply
to the contacts listed below for more information).

For engaged intellectuals, policymakers, journalists, and scholars from
the region, the new Transition will provide a rare forum for the
exchange of ideas and criticism on political, economic, and cultural
issues and events. Transition will also offer readers from abroad a
window on the experiences of countries moving away from a single
ideology. We are certain that the magazine's new format and orientation
will make it even more useful for your work, as well as contributing
more to your understanding.

For more information, contact the OMRI Marketing Department at tel.
(420-2) 6114 2114, fax (420-2) 6114 3181; email: transition-DD@omri.cz
*^!*^!*^!*^!*^!*^!*^!*^!*^!*^!*^!*^!*^!*^!*^!*^!*^!*^!*^!*^!*^!*^!*^!*^!

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