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RFE/RL NEWSLINE

Vol 1, No. 54, Part I, 17 June 1997


Vol 1, No. 54, Part I, 17 June 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

* GOVERNMENT SEEKS DUMA APPROVAL FOR SOCIAL SPENDING REDUCTIONS


* RUMORS OF SECRET DEAL BETWEEN RUSSIAN GOVERNMENT, OPPOSITION DENIED

*AZERBAIJANI OFFICIAL DIVULGES DETAILS OF NEW KARABAKH PEACE PLAN

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RUSSIA

GOVERNMENT SEEKS DUMA APPROVAL FOR SOCIAL SPENDING REDUCTIONS... Deputy Prime
Minister Oleg Sysuev submitted several draft laws on reforming the social
benefits system to the State Duma on 17 June, ITAR-TASS reported. The
proposals would reduce benefits to workers in law-enforcement agencies, who
are currently entitled to free public transport and subsidies for housing and
utilities. Sysuev said the measures would allow scarce resources to be
reallocated to poor families and would save Russia 30 trillion rubles ($5.2
billion) annually. He noted that some 200 categories of citizens are currently
entitled to social support and that the cost of those benefits has risen from
25.7 trillion rubles in 1992 to 45 trillion rubles this year. First Deputy
Prime Minister Anatolii Chubais, who also supports a means-tested system for
social benefits, recently pointed out that even he receives housing subsidies
because his father fought in World War II.

...AND FEWER PRIVILEGES FOR DUMA DEPUTIES. Sysuev said the government is also
requesting amendments to the law on the status of State Duma deputies,
ITAR-TASS reported on 17 June. One proposed change would limit deputies to 12
state-funded trips to the districts they represent per calendar year. The
government also wants to revoke the right of deputies' assistants to free
travel on inter-city trains or buses. Some Duma deputies have dozens or
hundreds of staff workers. Liberal Democratic Party of Russia leader Vladimir
Zhirinovsky is said to have more than 200 assistants.

PARLIAMENT, GOVERNMENT NEAR COMPROMISE ON BUDGET CUTS? A conciliatory
commission of representatives from the government and both houses of
parliament met on 16 June to discuss proposed cuts in 1997 budget spending,
but there are conflicting reports on whether progress was made at the meeting.
First Deputy Duma Speaker Aleksandr Shokhin of Our Home Is Russia told
Interfax that the two sides are close to reaching a compromise that would call
for spending cuts of some 34 trillion rubles ($5.9 billion) this year. The
government originally requested 108 trillion rubles in spending reductions.
However, ITAR-TASS quoted First Deputy Finance Minister Vladimir Petrov as
saying that there was "no movement forward" at the conciliatory commission
meeting. Duma Budget Committee Chairman Mikhail Zadornov of Yabloko also said
no compromise was reached. The commission is scheduled to submit its
recommendations to the Duma by 18 June.

PROSPECTS FOR TAX CODE PASSAGE UNCERTAIN. Duma Speaker Gennadii Seleznev told
ITAR-TASS on 16 June that he expects the Duma to approve a new tax code this
year, perhaps as early as September. However, Reuters reported that on 16 June
the Duma's Budget Committee issued a non-binding recommendation asking
deputies to reject the draft code in favor of less sweeping measures to change
the tax system. The Duma is scheduled to consider the code in the first
reading on 19 June. Duma Budget Committee Deputy Chairman Aleksandr Zhukov of
the Russian Regions faction told Interfax on 14 June that there is a "good
chance" that the parliament will approve the code in time for it to come into
effect in January 1998. However, Zhukov called on government officials to be
less "stubborn" and more willing to compromise on the code's provisions.

RUMORS OF SECRET DEAL BETWEEN GOVERNMENT, OPPOSITION DENIED. Representatives
from the government and the Communist-led opposition have vehemently denied a
report by the AiF-Novosti news agency saying government and opposition leaders
have struck a secret deal, RFE/RL's Moscow bureau reported on 16 June. The
report alleged that following secret negotiations, Communist Party leader
Gennadii Zyuganov and Duma deputy Nikolai Ryzhkov, head of the Popular Power
faction, agreed that the Duma will approve the new tax code, spending cuts,
and reforms of the social benefits system. In return, government
representatives allegedly promised that wage and pension arrears would be
paid, Yeltsin would not dissolve the Duma, Russia's electoral system would not
be changed, and Vladimir Lenin's body would not be removed from the mausoleum
on Red Square. Duma Security Committee Chairman Viktor Ilyukhin, a leading
Communist, called the report "disinformation."

PRIMAKOV DEFENDS SALE OF RUSSIAN MISSILES TO CYPRUS. Foreign Minister Yevgenii
Primakov said on 16 June that Russia will proceed with the sale of S-300 air
defense missiles to Greek-controlled Cyprus, despite Turkish and Western
objections, AFP and ITAR-TASS reported. He said Moscow will consider canceling
the deal only if Cyprus is demilitarized. Primakov was speaking to journalists
in Moscow following a meeting with his Cypriot counterpart, Yiannakis
Cassoulidis. The deal, agreed in January, was immediately criticized by
Turkey, the U.S., and Britain. Russian officials rejected that criticism as an
attempt to squeeze Russia out of the world arms market.

MASKHADOV ORDERS TWO CHECHEN REGIMENTS TO DISBAND. Chechen President Aslan
Maskhadov signed decrees on 15 June ordering that the Borz [Wolf] regiment and
the General Dudaev army, headed by maverick field commander Salman Raduev, be
disbanded, Russian media reported. Members of those formations will be offered
the opportunity to serve in the Chechen National Guard. A spokesman for Raduev
told NTV, however, that the army's 4,500 men would execute Raduev if he tried
to comply with Maskhadov's decree. On 16 June, Maskhadov mobilized 3,000
police in operation called "Shield of Law and Order," which succeeded in
securing the release of six hostages but not that of the five kidnapped
Russian journalists

YELTSIN SAYS RUSSIAN-BELARUSIAN HYMN CANNOT BE ADOPTED WITHOUT HIS APPROVAL.
Yeltsin says the Russian-Belarusian Parliamentary Assembly lacks the authority
to adopt the music of the former Soviet national anthem as the hymn of the
Russian-Belarusian union, Russian news agencies reported on 16 June. The
parliamentary assembly voted to adopt the anthem's music at a recent meeting
(see "RFE/RL Newsline," 13 June 1997). According to a statement released by
the presidential press service, Yeltsin said endorsing a hymn for the union
would require his approval. Also on 16 June, Belarusian President Alyaksandr
Lukashenka met with Russian Prime Minister Viktor Chernomyrdin in Sochi, where
both are vacationing. No details were released about their meeting.

YELTSIN SUPPORTS EARLY ELECTIONS IN PRIMORE. During a meeting with First
Deputy Prime Ministers Chubais and Boris Nemtsov, Yeltsin said he supports
holding early gubernatorial elections in Primorskii Krai, Russian news
agencies reported on 16 June. Krai Governor Yevgenii Nazdratenko easily won
election in December 1995 and has expressed confidence that he would be
re-elected if early elections were called. Nemtsov, who recently visited
Primore, was asked during a 15 June interview with Russian TV how federal
authorities would respond if Nazdratenko won a new election. Nemtsov replied
that the government would respect the will of the people and work with whoever
won the race. In a 17 June interview with "Sovetskaya Rossiya," Communist
Party leader Zyuganov slammed the authorities for using Nazdratenko as an
example in order to frighten "inconvenient" governors, although he said he was
not defending Nazdratenko personally.

ZYUGANOV, ZHIRINOVSKY CAMPAIGNING IN NIZHNII NOVGOROD. Communist Party leader
Zyuganov and Liberal Democratic Party of Russia leader Zhirinovsky are
campaigning in Nizhnii Novgorod Oblast on behalf of Communist State Duma
deputy Gennadii Khodyrev, who is contesting the 29 June gubernatorial
election, RFE/RL's correspondent in Nizhnii Novgorod reported on 16 June.
Khodyrev is the closest challenger to Nizhnii Novgorod Mayor Ivan Sklyarov in
the battle to succeed Boris Nemtsov. During the Soviet period, Khodyrev was
first secretary of the oblast party committee. In an interview published in
the 17 June "Sovetskaya Rossiya," Zyuganov explained that success in the
Nizhnii Novgorod election is "important for us on principle." He noted that
the Russian media have hailed Nemtsov and the reforms he implemented in the
oblast and that foreign leaders, including former British Prime Minister
Margaret Thatcher, have visited Nizhnii Novgorod.

BACKGROUND ON CLOSURE OF GOVERNMENT-FUNDED MAGAZINE. Many Russian journalists
are worried by the fate of the state-funded magazine "Rossiiskaya
Federatsiya," according to "Nezavisimaya gazeta" on 17 June. The government
recently announced plans to cease publication of the magazine, citing
budgetary constraints (see "RFE/RL Newsline," 12 June 1997). "Nezavisimaya
gazeta" said the conflict between the magazine and the government was sparked
by an article published in the monthly's March issue. That article criticized
the IMF and said the public is dissatisfied with current economic policies.
First Deputy Prime Minister Chubais reportedly asked the magazine's editor,
Yurii Khrenov, to resign. When Khrenov refused, Chubais, who is also finance
minister, allegedly instructed the Finance Ministry to audit the magazine. The
Glasnost Defense Foundation, a watchdog group, recently issued a statement
charging that Chubais is trying to suppress media outlets that criticize the
government.

MILITARY CORRUPTION UPDATE. Criminal charges have officially been filed
against Admiral Igor Khmelnov, former chief of staff of the Russian Navy,
ITAR-TASS reported on 17 June. Maj.-Gen. Valerii Suchkov, the military
procurator of the Pacific Fleet, said Khmelnov is charged with abusing his
authority. Suchkov has said that beginning in August 1994, when Khmelnov was
commander of the Pacific Fleet, two aircraft carriers were sold to South
Korea, and the $9 million in proceeds were used to build new housing for
officers in Khmelnov's entourage. Proceeds from the sale of another 64
warships to India and South Korea were also allegedly used to build housing
for favored officers. Khmelnov was sacked by presidential decree in April.
Former Deputy Defense Minister Konstantin Kobets was arrested the following
month and charged with corruption, abuse of office, and illegal possession of
firearms

TRANSCAUCASUS AND CENTRAL ASIA

AZERBAIJANI OFFICIAL DIVULGES DETAILS OF NEW KARABAKH PEACE PLAN. Azerbaijani
State Adviser Vafa Guluzade has summarized the draft peace plan that the
Organization for Security and Cooperation in Europe's Minsk Group submitted to
the leaderships of Armenia, Azerbaijan, and the self-proclaimed
Nagorno-Karabakh Republic in late May, Noyan Tapan reported on 16 June,
quoting Azerbaijani media. The plan gives Nagorno-Karabakh autonomous status
within Azerbaijan and the right to its own constitution but stipulates the
downsizing of the Karabakh armed forces. It calls for the withdrawal of
Karabakh Armenian forces from five raions in Azerbaijan, the town of Shusha,
and the Lachin corridor, which would be leased and policed by the OSCE. In
addition, Nagorno-Karabakh would be granted the status of a free economic
zone. Interfax reported on 16 June that the Minsk Group co-chairmen may submit
a report on Karabakh to the G-7 summit in Denver.

MODEST PROGRESS IN ABKHAZ TALKS? In his weekly radio address, Georgian
President Eduard Shevardnadze said on 16 June that the ongoing talks in Moscow
between Russian, Abkhaz, and Georgian representatives are no longer at a
"standstill" and that his Abkhaz counterpart, Vladislav Ardzinba, is "seeking
compromise solutions," Interfax reported. Shevardnadze reaffirmed his
readiness to meet personally with Ardzinba. "Nezavisimaya gazeta" on 17 June
similarly quoted Russian Foreign Ministry special envoy Gennadii Ilichev as
saying a "certain" progress has been made. Russia rejects the Abkhaz argument
that economic difficulties preclude the repatriation to Abkhazia of ethnic
Georgians who fled the region in 1992-3. But it supports the Abkhaz refusal to
condone the deployment of CIS peacekeepers throughout Gali Raion to which the
Georgians wish to return.

ARMENIAN PARLIAMENTARY CRISIS DEFUSED. Babken Ararktsyan resumed his duties as
parliamentary speaker on 16 June after lengthy discussions with President
Levon Ter-Petrossyan, Prime Minister Robert Kocharyan, and Defense Minister
Vazgen Sargsian, Armenian agencies reported. On 11 June, Ararktsyan had
offered his resignation to protest the rejection of a draft law he had
proposed that would allow students to continue to defer conscription (see
"RFE/RL Newsline," 12 June 1997). The parliament, however, voted not to accept
his resignation. Discussion of an alternative draft law, which abolishes the
deferment provision, is to be postponed until the fall. If adopted, that bill
will take effect only in 1998. Eduard Yegoryan, the chairman of the
parliamentary Commission on State and Legal Affairs, condemned the mentality
whereby the "first thought that comes to parents when a son is born is how to
exempt him from military service," Noyan Tapan reported.

CONSORTIUM ASSESSES EXPORT PIPELINES. Representatives of the Azerbaijan
International Operating Company [AIOC] told journalists in Baku that the
choice of the export pipeline for Azerbaijan's Caspian oil will be decided on
economic rather than political grounds, according to "Nezavisimaya gazeta" on
17 June. AIOC vice president Gregory Rich said the Baku-Ceyhan route favored
by Turkey is the most expensive and would be economically disadvantageous to
Azerbaijan. He added that the export of Azerbaijan's oil via Ukraine, although
technically feasible, may be economically disadvantageous since the AIOC plans
to sell the oil in question to southern European countries. Rich said he
doubted that either Turkey or Ukraine could afford to pay world prices for
Azerbaijan's oil for domestic consumption. On 13 June, Azerbaijan's parliament
ratified an agreement between the state oil company SOCAR and a consortium of
European and Iranian companies to develop the Lenkoran-Deniz and Talysh-Deniz
deposits, Interfax reported.

TAJIK ARMY LEADER ON TROOP MOVEMENT. Col. Mahmud Khudaberdiyev, the commander
of the Tajik Army's First Brigade, told "ASIA PLUS" that units from his
brigade moved from their base in Kurgan-Teppe to the Yavon district as part of
military maneuvers scheduled to finish on 18 June (see "RFE/RL Newsline," 13
June 1997). Khudaberdiyev denied he would seek to prevent fighters of the
United Tajik Opposition (UTO) from returning to Kurgan-Teppe following the
signing of the Peace and National Accord Treaty on 27 June in Moscow. But he
added that they must be disarmed when they arrive, saying he would not
tolerate people who would "destabilize" the area. Khudaberdiyev also noted
there are 48,000 refugees in Kurgan-Teppe and that all of them have been given
jobs.

CHANGES IN KAZAK GOVERNMENT. President Nursultan Nazarbayev has appointed
Deputy Prime Minister Dyusenbay Duysenov as minister of energy and natural
resources, according to RFE/RL correspondents in Almaty. Duysenov replaces
Viktor Khrapunov, who now becomes mayor of Almaty. Shalbay Kulmakhanov, until
now mayor of Almaty, becomes the head of the State Committee for Emergency
Situations, replacing Nikolai Makiyevskii.

BELGIAN COMPANY AWARDED CONCESSION FOR KAZAK GAS NETWORK. The Belgian company
Tractabel has been awarded a 15-year concession for natural gas transport
networks in western and southern Kazakstan, Interfax reported on 16 June.
Tractabel will pay Kazakstan $30 million for the network and will invest $600
into it. Tariffs and transportation rates will be set by Kazakstan's
anti-monopoly committee. Last year, Tractabel was awarded a contract to
develop a power grid for Almaty.

KAZAK MINERS DEMONSTRATE. Some 500 miners in the northern Karaganda region
held a one-hour rally on 16 June to protest the country's pension system,
according to RFE/RL corespondents and ITAR-TASS. They also drew up a petition
to President Nazarbayev asking him to reconsider changes made to that system
last year, when the eligible age to receive pensions was raised from 60 to 63
for men and 55 to 58 for women. The miners point out that the career
expectancy of a miner is 20-25 years.



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