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No. 55, Part I, 19 March 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 March issue of OMRI's journal TRANSITION**: THE MIDDLE CLASS - Economic Reform Casts a Long Shadow in Russia - The Making of the Middle Classes - Poland's Perpetually New Middle Class - Some Russians Are Learning to Be Rich PLUS... - RUSSIA: The NATO Distraction (A discussion with Grigorii Yavlinksii) - UKRAINE: Caution is the Key for Ukraine's Prime Minister (a profile of Pavlo Lazarenko) - CENTRAL EUROPE: Security Services Still Distrusted - TAJIKISTAN: Defining the 'Third Force' MEDIA NOTES: Journalists as Physical Pawns; Political Moves at Russian TV For subscription information about OMRI's new monthly, send an e-mail message to transition-DD@omri.cz Note: Transition is not available electronically **See important message below on the upcoming changes to TRANSITION ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ RUSSIA NEW APPOINTMENTS TO CONTINUE. First Deputy Prime Minster Anatolii Chubais told NTV on 18 March that "unexpected and quite significant changes" may occur in the government's composition over the next several weeks. Several slots remain to be filled, such as that of Minister for Foreign Economic Relations. Prime Minister Viktor Chernomyrdin told ITAR-TASS on 19 March said that First Deputy Prime Minister Boris Nemtsov is considering who to appoint to supervise social affairs and monopoly policy, and suggested that some "professionals" from Grigorii Yavlinskii's Yabloko party may be persuaded to join the government. -- Peter Rutland OPINIONS DIFFER OVER CABINET CHANGES. The recent reshuffle marks a defeat for First Deputy Prime Minister Anatolii Chubais, argues Nikolai Vardul in Kommersant-Daily on 18 March. He says it was Prime Minister Viktor Chernomyrdin and not Chubais who recruited Nizhnii Novogorod Governor Boris Nemtsov and who insisted on the removal of Chubais's ally, banker Vladimir Potanin. Chubais was unable to persuade some key reformers, such as Ella Pamfilova, to join the administration, and "it suddenly turns out that Russia's No. 1 administrator does not have a strong team of his own." In contrast, Otto Latsis, writing in Izvestiya on 19 March, argues that Nemtsov's appointment "doubles the chances of success in the next phase of reform" because Nemtsov is a partner, and not a counterweight, to Chubais. Latsis suggests there was a serious effort to push out ministers who were seen as representatives of industrial and financial lobbies. -- Peter Rutland NEMTSOV'S AGENDA. Boris Nemtsov laid out his economic ideas in a February interview, published in Izvestiya on 19 March. Nemtsov noted that subsidies for housing and utilities cost the nation 100 trillion rubles ($18 billion) in 1996 -- more than the entire defense budget -- and ate up 22% of the Nizhnii Novgorod Oblast budget. He called for competition in the provision of services, the formation of tenants' cooperatives, and the installation of meters. (All these ideas are part of the World Bank's housing reform program for Russia.) Nemtsov acknowledged that this will take several years, and that immediate rate hikes would be counterproductive. The state should set a single tariff for the electricity grid and railways to stop their monopolistic overpricing, and then encourage private firms to compete to supply power and freight service. He said there was no need for a "revolution" with Gazprom "since its prices are substantially below world levels." He favors mandatory personal income declarations, prison for tax dodgers, and an end to channeling budget funds through "authorized" banks. He said "The country is now facing a choice. Last year it was between the prison and the barracks. Now it is between mafia capitalism and a normal market in a democratic society without a giant gulf between the rich and poor." -- Peter Rutland LIVSHITS TO ADMINISTRATION, POTANIN BACK TO BANKING. Former Deputy Prime Minister and Finance Minister Aleksandr Livshits will now join the presidential administration as deputy chief of staff for economic issues, NTV reported on 18 March. Prior to his appointment in August 1996, Livshits had served as presidential economics advisor. Livshits found himself embroiled in clan battles between various financial- industrial groups, and proved unable to tackle the slump in tax revenue. Former First Deputy Prime Minister Vladimir Potanin was the only former minister to hold a press conference after the cabinet reshuffle. He said he will return to head the powerful Oneksimbank, the position he resigned from on 15 August. -- Robert Orttung IGNATENKO LEAVES GOVERNMENT BUT STAYS AT ITAR-TASS. Vitalii Ignatenko put a positive spin on his removal from the government and the liquidation of the post of deputy prime minister in charge of media issues. Ignatenko told ITAR-TASS on 18 March that during the last two years he had helped create a "legislative and financial basis" for the media, eliminating the need for further government supervision of media activities. Ignatenko will continue to head the ITAR-TASS news agency, a job he has held since 1991. -- Laura Belin KOMSOMOLSKAYA PRAVDA TO SELL 20% STAKE TO ONEKSIMBANK. The board of directors of the daily Komsomolskaya pravda (KP) has decided to sell a 20% equity stake in the paper to Oneksimbank, ITAR-TASS and Kommersant- Daily reported on 18-19 March. KP directors say they need additional financial resources. Originally, the stake was supposed to be sold to gas giant Gazprom, but this deal fell through. The decision to sell the stake, however, was opposed by the majority of KP's editorial board. Chief Editor Valerii Simonov believes the sale threatens the paper's editorial independence. -- Natalia Gurushina RODIONOV: SHAKEUP OF TOP BRASS IMMINENT. Defense Minister Igor Rodionov, who appears to have survived the ongoing cabinet reshuffle, told journalists on 18 March that "some generals" who "are engaged in activities incompatible with military service," would soon be sacked, ITAR-TASS reported. While he did not mention any names, Rodionov said he expected President Yeltsin to sign a decree soon confirming the dismissal of Army General Vladmir Semenov, the commander of the ground forces. Semenov has been suspended from duty since last November, when Rodionov accused him of misconduct. Semenov himself issued a statement the same day complaining that in the four months since Rodionov leveled charges against him, the defense minister neither substantiated them nor met with Semenov to explain them. -- Scott Parrish RUSSIA CRITICIZES GERMANY ON DESERTERS, U.S. ON BELARUS. Russian Foreign Ministry spokesman Vladimir Andreev denounced as "politically motivated" the recent decision by Bonn to grant asylum to Soviet Army deserters (see OMRI Daily Digest, 27 February, 1997), ITAR-TASS reported on 18 March. Andreev said that granting asylum to the some 600 soldiers, who deserted from former Soviet troops based in Germany until 1994, was an admission that Germany was responsible for their decision not to return to Russia, saying he hoped Bonn did not aim at encouraging desertion. Russia had requested the soldiers' extradition, saying many had committed other crimes. Andreev also panned American policy toward Belarus as "erroneous and counterproductive," saying attempts to "artificially isolate" Minsk could generate "political tension." He said Moscow is "astonished" at Washington's criticism of Russo-Belarusian integration efforts, since the U.S. supports economic integration in Western Europe. -- Scott Parrish YELTSIN VETOES LAW ON CONSTITUTIONAL AMENDMENT PROCEDURE. President Yeltsin vetoed a law outlining the procedure for adopting constitutional amendments, which was passed by the Duma in February after the president vetoed an earlier version, ITAR-TASS reported on 18 March. A statement issued by the presidential press service claimed the law was unconstitutional but did not specify which articles it contradicted. The constitution stipulates that amendments must be approved by a two-thirds majority in the Duma, a three-fourths majority in the Federation Council, and by legislatures in at least two-thirds of Russia's 89 regions. A federal law such as that which Yeltsin vetoed is needed to specify procedural details. -- Laura Belin GOVERNMENT PREPARES FOR DAY OF ACTION. On 18 March, less than two weeks before a nationwide day of protest organized by the Federation of Independent Trade Unions of Russia (FNPR), Prime Minister Chernomyrdin ordered regional leaders to personally conduct negotiations with union representatives and employers to find ways to reduce social tension and to report back to Moscow on a daily basis, ITAR-TASS reported. Cherno- myrdin stressed the need to tackle wage arrears, which total about 50 trillion rubles. FNPR Deputy Chairman Aleksei Surikov said the same day that the protest would go ahead on 27 March despite the recent government reshuffle, but Labor Minister Gennadii Melikyan said the FNPR would not call for the resignation of the government. Such calls are, however, likely to be heard in some regions. -- Penny Morvant CHECHEN PARLIAMENT ELECTS SPEAKER. After several inconclusive rounds of voting, on 17 March the new Chechen parliament elected field commander Ruslan Alikhadzhiev as its speaker, ITAR-TASS reported. Alikhadzhiev, a member of the Chechen National Independence Party, was characterized by a colleague as "a decent man with a higher economic education." Addressing the parliament session, President Aslan Maskhadov urged deputies to draft and enact urgently needed legislation. Also on 17 March, the leader of the Terek Cossack army sent a letter to Maskhadov requesting a meeting to discuss stabilizing the situation in the North Caucasus and protecting ethnic Russians in the region from terrorism, according to ITAR-TASS. Plans for staging terrorist attacks were confiscated from a group of Chechen militants, subordinate to field commander Salman Raduev, who were detained on the border between Chechnya and the rest of the Russian Federation, Rabochaya tribuna reported on 18 March quoting local media in Krasnodar krai. -- Liz Fuller CONFUSION OVER ALLEGED ASSASSINATION ATTEMPT IN CHECHNYA. Chechen Security Council Secretary Akhmed Zakaev told ITAR-TASS on 18 March that a bomb explosion in central Grozny the previous day had been intended to kill acting First Deputy Prime Minister Movladi Udugov. Udugov, however, denied having been in the vicinity at the time of the explosion. Also on 18 March, a Russian military helicopter patrolling the border between Chechnya and North Ossetiya was fired on from Chechen territory, Reuters reported. No one was injured. -- Liz Fuller PLANE CRASHES EN ROUTE TO TURKEY. About 50 passengers and crew were killed when a Russian airliner en route to Turkey crashed near Cherkessk in southern Russia on 18 March, international agencies reported. The plane, a Stavropol Airlines AN-24, crashed half an hour after taking off from Stavropol for the Turkish city of Trabzon. Officials said most of the passengers were Russian "shuttle traders" traveling to Turkey to purchase consumer goods for resale at home. Safety standards have fallen since the Soviet monopoly Aeroflot was split into numerous smaller domestic companies, some of which take shortcuts in maintenance and safety standards. -- Penny Morvant BUS BOMBERS SENTENCED. The Supreme Court of Kabardino-Balkariya on 17 March convicted two brothers for the June 1996 bombing of a bus in the republic's capital, Nalchik, in which six people were killed, Russian agencies reported. The brothers received relatively light sentences -- seven and seven and a half years -- because they are minors. -- Penny Morvant RUSSIA-IRAQ ECONOMIC RELATIONS GET NEW BOOST. Iraq's government gave Russia most-favored-nation status in selling Iraqi crude oil in exchange for food and other humanitarian products, agencies reported on 18 March. Under the U.N. food-for-oil deal, Iraq can sell $2 billion worth of oil every six months. Russian Fuel and Energy Minister Petr Rodionov, who heads the Russian delegation at the meeting of the Russian-Iraqi committee for economic cooperation in Baghdad, encouraged Russian companies (which expressed interest in selling some 100,000 tons of wheat, 50,000 tons of sugar, as well as spare parts for power stations to Iraq) to increase the supply of goods to Iraq. He noted that so far they have failed to realize the full potential of the food-for-oil deal. -- Natalia Gurushina TRANSCAUCASIA AND CENTRAL ASIA INDEPENDENT UNIONS FACE HARASSMENT IN KAZAKSTAN. The 19 March edition of Nezavisimaya Gazeta reports that the independent trade union (NPTsK) president of Kazakstan, Leonid Solomin, has been charged under Kazakstan's criminal code for "engaging in an illegal hard currency operation." The charge stems from Solomin's wages being paid in hard currency, which is against Kazak law. The paper points out that this is the latest of several actions against independent trade unions made by the government's Committee for National Security (KNB). The leader of the Karaganda NPTsK, Rahim Uteuov, said the KNB uses criminal proceedings to intimidate non-Kazaks, and that Kazaks who participate in unions are branded "traitors." -- Bruce Pannier KAZAKSTAN TO PULL OUT OF CUSTOMS UNION? Gani Kasymov, chairman of the State Customs Committee of Kazakstan, said "the economic security of the state is suffering" due to "the huge amount of contraband goods brought in," Reuters reported on 18 March. Kasymov complained that "There is no point carrying out internal economic reforms if the length and breadth of our borders are so porous." It appears that Kazakstan may be planning to withdraw from the custom's union with Russia, Kyrgyzstan, and Belarus, although Almaty does not want to be blamed for the union's collapse. -- Bruce Pannier BORDER GUARD CHIEF IN KYRGYZSTAN. The head of the Russian Federal Border Guard Service, Gen. Andrei Nikolaev, held talks with Kyrgyz President Askar Akayev and Security Minister Myrzakan Subanov on 18-19 March, according to Russian sources. A protocol between Kyrgyzstan and Russia on financing the border guards in Kyrgyzstan was signed. Also agreed to was use of Kyrgyz air bases for operations by the Border Guards in Tajikistan. -- Bruce Pannier THE DEATH PENALTY IN CENTRAL ASIA. The Kyrgyz daily Vechernyy Bishkek on 7 March released figures on the number of executions in five Central Asian states for 1996. According to the article, Kyrgyzstan executed 41 people in 1996 and pardoned one. Kyrgyzstan is the only Central Asian state not to employ the death penalty for drug related offenses and will lower the number of crimes punishable by death from 16 to five. Kazakstan executed 42 people but has also lowered crimes punishable by death from 17 to six. The number of executions in Turkmenistan could only be estimated but the article put it at around 400. Uzbekistan also does not publish figures but uses the death penalty for "crimes against peace and security." Tajikistan officially executed 20 people last but the newspaper noted this was a dubious figure. -- Bruce Pannier [As of 12:00 CET] Compiled by Pete Baumgartner *^!*^!*^!*^!*^!*^!*^!*^!*^!*^!*^!*^!*^!*^!*^!*^!*^!*^!*^!*^!*^!*^!*^!*^! 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. 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 ------------------------------------------------------------------------ SUBSCRIBING/UNSUBSCRIBING 1) Compose a message to firstname.lastname@example.org 2) To subscribe, write: SUBSCRIBE OMRI-L FirstName LastName (include your own name) To unsubscribe, write: UNSUBSCRIBE OMRI-L 3) Send the message BACK ISSUES Back issues of the OMRI Daily Digest are available through the World Wide Web, by FTP and by E-mail. 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