Vol 1, No. 19, Part I, 25 April 1997

Vol 1, No. 19, Part I, 25 April 1997

This is Part I of Radio Free Europe/Radio Liberty's Newsline.
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 RFE/RL NewsLine are available through RFE/RL's WWW
pages: http://www.rferl.org/newsline/search/

Back  issues of the OMRI Daily Digest are available through OMRI's
WWW pages: http://www.omri.cz/

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Headlines, Part I

* DUMA CALLS FOR DAY OF PROTEST AGAINST NATO
EXPANSION

* RUSSIA SAYS AGREEMENT REACHED WITH IMF

* OSCE SUSPENDS MONITORING OF KARABAKH CEASE-
FIRE

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RUSSIA

DUMA CALLS FOR DAY OF PROTEST AGAINST NATO
EXPANSION. The State Duma has voted 253 to 14 to pass a
resolution calling for all state authorities and public
organizations to hold a "day of protest against NATO
expansion" on 9 May, the anniversary of the World War II
victory in Europe, Russian news agencies reported yesterday.
The resolution describes NATO expansion as "the greatest
military threat to our country over the last 50 years." In a
separate resolution, the Duma called on legislators in NATO
countries to take steps to prevent Europe from "slipping
toward a new confrontation." U.S. Deputy Secretary of State
Strobe Talbott and U.S. Secretary of State Madeleine Albright
are to travel to Moscow next week for talks with Foreign
Minister Yevgenii Primakov over a proposed Russia-NATO
charter. Primakov is scheduled to meet with NATO Secretary-
General Javier Solana on 6 May.

RUSSIA SAYS AGREEMENT REACHED WITH IMF. Central
Bank Chairman Sergei Dubinin says IMF and Russian officials
have agreed on Russia's economic program for 1997, ITAR-
TASS reports today. An accord must be signed before the IMF's
board of directors decides whether to issue further
disbursements of a $10 billion three-year loan to Russia.
ITAR-TASS reported on 23 April that the government plans to
borrow $9.8 billion from abroad this year, including $3.65
billion in IMF credits, $2.95 billion in Eurobonds, and $1.5
billion in direct loans from foreign governments. Russia also
plans to extend about $400 million in foreign credits this year,
more than half of which will go to Bulgaria and India.

RUSSIAN AIR FORCE ON CHECHEN THREAT. A spokesman
for the Russian Defense Ministry told Interfax yesterday that
military flights over Chechnya will continue, despite Chechen
Vice President Vakha Arsanov's 23 April statement that
aircraft violating Chechen airspace will be shot down. State
Duma speaker Gennadii Seleznev termed the threat "absolute
rubbish." Nezavisimaya gazeta today quotes an air force
spokesman as claiming that the Chechen authorities do not
wish to be hindered in the large-scale air transport of drugs
and arms from Afghanistan and Pakistan to Cyprus.
Meanwhile, a Foreign Ministry spokesman warned that Russia
will take "appropriate measures" against any countries that
establish ties with Chechnya beyond "economic,
humanitarian, and cultural contacts," Interfax reported
yesterday.

RUSSIA REQUESTS EXTRADITION OF STANKEVICH. The
Polish Justice Ministry has received a formal request from the
Russian Procurator-General's Office to extradite former
presidential adviser Sergei Stankevich, ITAR-TASS reports
today. Stankevich is accused of taking a $10,000 bribe in
1992 and could face up to 10 years in prison (see RFE/RL
Newsline, 21 and 22 April 1997). The extradition process could
take months. Izvestiya reported on 23 April that Stankevich
told a Polish court he believes he will be killed if he is returned
to Russia.

PROGRESS TOWARD RESOLVING ROMANOV TREASURES
DISPUTE. Russian and U.S negotiators issued a statement
yesterday saying "considerable progress" has been made in
talks over some 250 jewels, paintings, and other artifacts from
the Romanov dynasty that are currently in the U.S., Reuters
and ITAR-TASS reported. Russia is demanding the immediate
return of the collection, claiming the U.S. organizers of a
Romanov exhibition violated their contractual obligations and
put the security of the treasures at risk. Deputy Russian
Culture Minister Mikhail Shvydkoi and ITAR-TASS director-
general Vitalii Ignatenko flew to Washington this week to lead
the negotiations. Many of the exhibits were moved to the
Russian embassy on 23 April after two embassy cars had
blocked the truck carrying the treasures for several days (see
RFE/RL Newsline, 21 April 1997). The rest of the collection is
reportedly being stored in Washington's Corcoran Art Gallery.

DUMA FAILS TO PASS RESOLUTION DENOUNCING
CHUBAIS. A resolution declaring First Deputy Prime Minister
Anatolii Chubais unfit for office gained 203 votes in the Duma-
-23 short of the majority required for passage, Russian news
agencies reported yesterday. The resolution was proposed by
Duma Security Committee Chairman Viktor Ilyukhin of the
Communist Party and Viktor Rozhkov of the Russian Regions
faction. It referred to the campaign finance scandal in which
two Chubais associates were caught carrying more than
$500,000 out of government headquarters last June. The
Procurator-General's Office recently dropped the criminal
investigation of that case. Earlier this year, the Duma passed
resolutions accusing Chubais of not paying his 1996 taxes on
time and calling his appointment to the government a "direct
challenge to Russian public opinion."

DUMA ON CORRUPTION. The Duma has asked the
Procurator-General's Office to request again that the
Federation Council lift the immunity of Yurii Kravtsov, the
chairman of the St. Petersburg legislature, ITAR-TASS reported
yesterday. Kravtsov has been accused of misappropriating 350
million rubles ($61,000) in state funds. The upper house
refused to lift his immunity from criminal prosecution last
November. The Duma yesterday also instructed the state's
Audit Chamber to examine the activities of the Ulyanovsk
Oblast administration. Deputies cited allegations of corruption
and misuse of federal funds in Ulyanovsk.

PRIMORE LEGISLATURE DEFIES SUPREME COURT
RULING. The Primorskii Krai Duma has extended its term
until the end of this year, defying a recent Supreme Court
decision, ITAR-TASS reports today. The legislature's term
expired last December, but deputies voted to extend their
mandates for one year rather than call new elections. The
Supreme Court on 22 April approved an earlier ruling by a
Primorskii Krai court saying the deputies lacked the authority
to extend their term. The krai Duma is dominated by
supporters of Primore governor Yevgenii Nazdratenko, who has
repeatedly clashed with Viktor Cherepkov, the mayor of the
krai's capital, Vladivostok.

CENTRAL BANK LOWERS REFINANCING RATE. The Central
Bank has lowered its annual refinancing rate from 42% to 36%
as of 28 April, Russian news agencies reported yesterday. It is
the second reduction this year and the seventh since February
1996, when the refinancing rate was 160%. Some observers
believe the bank should lower the rate even further to
stimulate investment. The State Statistics Committee has
estimated inflation at 21.8% for 1996 and 5.3% for the first
quarter of 1997. The government has set a goal of 12% annual
inflation for 1997.


TRANSCAUSASUS AND CENTRAL ASIA

OSCE SUSPENDS MONITORING OF KARABAKH CEASE-
FIRE. Danish Foreign Minister and OSCE chairman Niels
Helveg Petersen said yesterday that the organization has
suspended its regular monitoring of the front-line between
Armenian and Azerbaijani forces, in southern Azerbaijan,
RFE/RL reported. The decision was prompted by an incident
on 15 April when the car transporting an OSCE monitor was
fired on near the Azerbaijani town of Horadiz. Also yesterday,
Russian Foreign Ministry spokesman Gennadii Tarasov
expressed concern at cease-fire violations over the past three
weeks, according to Interfax. The Armenian and Azerbaijani
Defense Ministries each accused the opposing side of opening
fire on enemy positions.

MKHEDRIONI MEMBER CONFESSES TO INVOLVEMENT IN
POLITICAL ASSASSINATIONS. Gocha Tediashvili, a member
of the banned paramilitary organization Mkhedrioni, told the
Georgian Supreme Court on 23 April that he was involved in
the murders of three prominent Georgian political figures,
Interfax reported yesterday. Tediashvili confessed to having
taken part in the 1994 killings of Deputy Interior Minister
Giorgi Gulua, Shevardnadze Fund President Soliko
Khabeishvili, and Georgian National Democratic Party leader
Gia Chanturia.

ARMENIA REMEMBERS 1915 GENOCIDE VICTIMS. Tens of
thousands of Armenians gathered yesterday at the Yerevan
monument to the Armenians massacred in Ottoman Turkey in
1915, Russian and Western agencies reported. Armenian
President Levon Ter-Petrossyan, Catholicos Garegin I, former
Russian Security Council secretary Aleksandr Lebed, and a
visiting Syrian official were among those who paid tribute.

HUMAN RIGHTS IN UZBEKISTAN. President Islam Karimov
told the parliament yesterday to have "more courage" in
reporting human rights violations, Interfax reported. Karimov
said there are numerous cases of officials violating those rights
and requested information on the identity of such officials.
Meanwhile on 23 April, an Uzbek court summoned Abid Khan
Nazarov to arraign him on charges of slander and inciting
ethnic, racial, and religious hatred, Reuters and RFE/RL's
Uzbek service reported. Nazarov was dismissed as mullah at
Tashkent's Tokhtoboy mosque and medressa in 1995 and then
evicted from his flat. He filed suit against the government
when he did not receive a promised new apartment. Earlier
this month, 300 people gathered to demonstrate solidarity
with Nazarov outside a court at which the mullah's case
against the government was being heard

INFORMATION SOUGHT ON MISSING KAZAK JOURNALIST.
Human rights activists and journalists from Kazakstan and
Kyrgyzstan are requesting more information on the
disappearance of Sergei Skorokhodov, who writes for the
Kazak newspaper Ekonomika Sevodnya, ITAR-TASS reported
yesterday. On 21 April, libel proceedings were launched
against Skorokhodov in connection with an interview he had
conducted with an opposition figure. The next day,
Skorokhodov left Almaty by car to attend a "Journalists and
Rights" conference in Bishkek but disappeared somewhere
between the Kazak and Kyrgyz capitals. He remains missing.


Undermining Russian Federalism

by Paul Goble

        Western pressure on Russia to improve the collection of
taxes as a precondition for future IMF loans is likely to spark
new conflicts between Moscow and Russia's far-flung regions.
That is because many of those regions have not been paying
what they owe, and any efforts to force them to do so now will
antagonize regional elites and prompt some to demand greater
autonomy. Such demands could quickly escalate beyond the
capacity of the central state apparatus to control.
        That potentially explosive cycle was set in motion earlier
this week when IMF representatives told Russian officials that
Moscow must reduce the country's budget deficit by improving
and enforcing the tax code. As in the past, the IMF is focusing
on the tax privileges that Russian President Boris Yeltsin has
extended to certain large enterprises, such as LUKoil and
Gazprom. The Western financial organization has demanded
that all firms pay the Russian government what they owe.
        But Russian officials have responded that an even greater
source of the tax collection shortfall may be the special
relations that Yeltsin has forged with 26 of the country's 89
regions. Drawn up to calm regional protests and to win Yeltsin
political support at key moments in the past, those special
accords have given the signatory regions various tax breaks
and in some cases even allowed them to withhold funds
entirely legally. The tax breaks Yeltsin gave to Tatarstan and
Sakha sparked public outrage, but the special favors he has
extended--generally in secret--to other regions may be even
more advantageous.
        Along with the general collapse of the country's tax
system, the special accords have meant that only eight of the
country's regions now pay more to the center than they
receive. In 1994, there were 25 such regions. If Moscow
attempts to reverse this situation and to collect taxes in a
universal and fair way, the tax problem is likely to become a
political problem as well.
        Over the last several years, the central government has
tried to force the regions to pay what they owe by withholding
governments payments to regions that do not contribute their
fair share. But instead of improving tax collection, that policy
has only led to ever more regions withholding taxes from the
center.
        Consequently, an IMF-inspired campaign by the central
authorities to collect more taxes from the regions is almost
certain to backfire if it is implemented quickly. Those regions
that have special agreements will view such efforts as yet
another example of Moscow's failing to keep its promises.
Those that do not have such accords will undoubtedly begin to
demand them--to the extent that the Russian government will
be forced to acknowledge the details of the current accords
and will then be seen to have acted in bad faith by having
extended privileges only to some regions. In both cases, such
attitudes about taxes are likely to spill over into attitudes
about relations between the center and the country's regions.
        Yeltsin has worked hard to buy off the regions and to
prevent further decay of central authority, but if he now tries
to reassert the power of the center in the area of taxes, he will
likely find that he has lost much of what he gained. That is not
to say that a tougher approach toward the collection of taxes
will spark a new drive for secession. But it is conceivable that
the IMF, in its efforts to improve Russian tax collections, may
undermine Russia's first tentative moves toward federalism.


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               Copyright (c) 1997 RFE/RL, Inc.
                     All rights reserved.
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