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Vol 1, No. 57, Part I, 20 June 1997
Vol 1, No. 57, Part I, 20 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/ xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx Headlines, Part I * YELTSIN TO GIVE OPENING SPEECH IN DENVER * DUMA APPROVES TAX CODE IN FIRST READING * UZBEK PRESIDENT ON RESOLVING NAGORNO-KARABAKH ISSUE xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx RUSSIA YELTSIN TO GIVE OPENING SPEECH IN DENVER... Russian President Boris Yeltsin has been invited by his U.S, counterpart, Bill Clinton, to deliver the opening speech at the "Summit of Eight" in Denver, Colorado, on 20-22 June. Yeltsin is scheduled to attend all sessions of the summit, except those dealing with financial aid. Yeltsin is hoping to speed up the process of Russia's joining the World Trade Organization and the Organization for Economic Cooperation and Development during his weekend in Denver. The Russian press reports Moscow is participating as a full partner but other participating countries, particularly Japan, have indicated this is not the case. The German daily "Die Welt" on 19 June questioned Russia's inclusion among the leading industrial powers, noting that economically "Russia is not just trailing the others. For the tenth year in succession, the country's economy is set to decline, with industrial output decreasing still further." ...BUT WON'T BE ABLE TO AVOID KURIL ISLAND ISSUE. Despite Yeltsin's statement that he is not prepared to resolve the Kuril Islands issue at the Denver Summit of Eight, Japan is already gathering support for its position on the disputed island chain. Tokyo has asked U.S. President Clinton to help solve the issue. Clinton's responded that it is a matter for the Russians and Japanese to discuss but noted that "obviously there will have to be some plan for resolving [it]." Russian Presidential spokesman Sergei Yastrzhembskii said "if this issue is addressed, it will have to be in the framework of joint steps undertaken to develop natural resources." Japanese Prime Minister Ryutaro Hashimoto has said he will seek support from other leaders at the summit. He reminded them that "the territorial issue is unresolved" and, as a result, Japanese-Russian relations remain the only "abnormal" ones among the Group of Eight. YELTSIN CONFIRMS NOT GOING TO NATO SUMMIT. Speaking to foreign journalists in Moscow on 19 June, Yeltsin confirmed he will not attend the July NATO summit in Madrid, Russian news agencies reported. He explained that "we decided that we needed to recover" after signing the Founding Act on relations between Russia and NATO (see "RFE/RL Newsline," 27 and 28 May 1997). Yeltsin added that "Russians would be uncomfortable" if he went to the summit, where the Western alliance is expected to invite several new members. Russian officials continue to speak out against NATO expansion. A recent nationwide poll by the Russian Public Opinion and Market Research Institute found that only 29.7% of respondents said they were "concerned" about NATO's plans for eastward expansion, while 44.7% said they were not concerned by such plans, "Nezavisimoe voennoe obozrenie" reported on 7 June. DUMA APPROVES TAX CODE IN FIRST READING. The State Duma on 19 June approved the tax code in the first reading by a vote of 244 to 84 with two abstentions, ITAR-TASS reported. According to Deputy Finance Minister Sergei Shatalov, the code would reduce the number of taxes from 75 to 28. Individuals would pay a 12% tax on earnings up to 60 million rubles ($10,400) per year. Income above that level would be taxed at a rate of 30%. Six of the seven Duma factions, including the vast majority of Communist deputies, supported passing the code. Only the Yabloko faction called for rejecting it. Yabloko leader Grigorii Yavlinskii argued that the code will neither reduce the tax burden nor simplify the tax system, RFE/RL's Moscow bureau reported. Before departing for Denver, Yeltsin called the Duma's vote on the tax code "a great victory for us." STALEMATE OVER BUDGET CUTS CONTINUES. The conciliatory commission that had sought a compromise over proposed cuts in 1997 budget spending has decided no longer to convene, citing an unbridgeable impasse between government and parliamentary representatives, RFE/RL's Moscow bureau reported on 19 June. The government, which originally sought 108 trillion rubles ($19 billion) in spending cuts, was willing to reduce the figure to 88 trillion rubles. Meanwhile, Duma representatives led by Communist deputy and Economic Policy Committee Chairman Yurii Maslyukov insisted that cuts do not exceed 42 trillion rubles. Maslyukov's plan, which the Duma is to consider on 20 June, would reduce spending on all "unprotected" budget items by 20%. The government's compromise plan would leave some programs untouched while cutting others by 30% or 45%. (The government initially sought to cut spending on programs in the last category by 55%.) DUMA ROUNDUP. The Duma on 19 June passed a law on the status of persons serving in the military, ITAR-TASS reported. The law would grant servicemen equal status, regardless of whether they serve in a branch of the armed forces or in troops subordinate to other federal agencies. It would allow soldiers to participate in meetings and demonstrations when off duty but would prohibit involvement in strike actions. In addition, religious organizations could not be created in military units, although soldiers would be allowed to attend religious services in their spare time. The Duma also approved a new version of the law on the subsistence minimum, which outlines procedures for calculating the subsistence level on a quarterly basis. An earlier version of the law was rejected by the Federation Council. Finally, the Duma overrode a presidential veto of a law on state regulation of the agro-industrial complex. DECREE LOWERS GAS RATES FOR SOME DOMESTIC CONSUMERS. Yeltsin issued a decree on 19 June ordering the gas monopoly Gazprom to reduce the rates it charges some domestic industrial consumers by 40%, Russian news agencies reported. The reduced rates will be offered only to enterprises that pay in cash and in advance for gas deliveries and also make a formal pledge to pay their debts for past gas deliveries by the end of 1997. Gazprom executives say the company is owed some $12 billion by domestic customers. First Deputy Prime Minister Boris Nemtsov told Interfax that in accordance with the decree, enterprises seeking to buy gas at the reduced rate would also have to promise to pay their debts to the federal budget by the end of this year. However, the text of the decree was not immediately available to confirm Nemtsov's statement. KULIKOV SUPPORTS PROPOSED MEDIA BOYCOTT OF CHECHNYA. Interior Minister Anatolii Kulikov has said he supports the proposal by some journalists to impose a media boycott of Chechnya in protest at the latest series of kidnappings of some of their colleagues in the breakaway republic, Interfax reported on 19 June. Kulikov termed the kidnappings a "dangerous and infectious disease typical of that region," adding that he was against paying ransoms to the kidnappers. Kulikov also said Russian construction workers and some 400 servicemen are still being kept prisoner in Chechnya and that their release was a "priority" for Moscow. According to Kulikov, Chechnya is full of gangs outside the control of President Aslan Maskhadov, who, he said, is unwilling to accept help from the Russian law-enforcement bodies. Kulikov expressed readiness to help Chechen authorities in combating crime. CENTRAL BANK SAYS CHECHNYA OBSTRUCTING AGREEMENTS. A spokesman for the Central Bank told ITAR-TASS on 19 June that Chechnya has refused to open an account at the bank, thereby contravening the 12 May agreement. That accord granted the Chechen National Bank an independent status and stated that it must have an account at the Russian Central Bank in order to allow transfers from and to commercial banks in Russia. The spokesman said the Chechens are insisting on establishing direct ties with Russian commercial banks and on having direct access to Russia's currency and equity markets. The spokesman added that the "unconstructive position" of the Chechen side hinders the transfer of Russian public funds for social purposes in the breakaway republic. LUZHKOV HOSTS MAYORS' CONFERENCE IN MOSCOW. Mayors from 29 of the world's largest cities attended a conference hosted by Moscow Mayor Yurii Luzhkov on 18-19 June. Yeltsin attended a reception for the mayors following the conference, at which he and Luzhkov traded compliments, Russian news agencies reported on 19 June. During the conference, Luzhkov signed a cooperation agreement with the mayor of Bangkok, Thailand. During the last year, Luzhkov has traveled abroad several times and established contacts with high-level officials. During a recent visit to Baku, he and Azerbaijani President Heidar Aliev signed several cooperation agreements between Moscow and Azerbaijan, "Nezavisimaya gazeta" reported on 17 June. YELTSIN APPOINTS KVASHNIN HEAD OF GENERAL STAFF. Yeltsin issued a decree appointing Col.-Gen. Anatolii Kvashnin first deputy defense minister and head of the General Staff of the armed forces, Russian news agencies reported on 19 June. Kvashnin was appointed provisionally to those posts on 23 May, the day after his predecessor, Viktor Samsonov, and former Defense Minister Igor Rodionov were fired. Kvashnin had previously served as commander of the North Caucasus military district. ST. PETERSBURG GOVERNOR TO SUE SOBCHAK. Vladimir Yakovlev is to sue former St. Petersburg Mayor Anatolii Sobchak for slander, RFE/RL's St. Petersburg correspondent reported on 19 June. In an interview recently published in "Sovershenno sekretno," Sobchak alleged that members of St. Petersburg's so-called Tambov criminal group work in a company run by Yakovlev's wife and boast that the governor is "their man." Sobchak told RFE/RL that he was only repeating allegations made public by Anatolii Ponedelko, who heads the St. Petersburg and Leningrad Oblast branch of the Interior Ministry. However, speaking to RFE/RL, Ponedelko confirmed only that the Procurator-General's Office is investigating the case. Yakovlev defeated Sobchak in a June 1996 election. Also on 19 June, Interior Minister Kulikov told an RFE/RL correspondent in Moscow that Sobchak is himself under criminal investigation by the Procurator-General's Office, but Kulikov did not specify the nature of the investigation. CAMPAIGN SCANDAL IN NIZHNII NOVGOROD. State Duma deputy and Communist-backed gubernatorial candidate Gennadii Khodyrev has charged that the Carnegie Endowment's Moscow center is financing the gubernatorial campaign of Nizhnii Novgorod Mayor Ivan Sklyarov, an RFE/RL correspondent in Nizhnii Novgorod reported on 19 June. Sklyarov, the favorite to win the race, and is supported by former governor Boris Nemtsov. Anatolii Nekrasov, the chairman of the oblast electoral commission, denied Khodyrev's claims. Nekrasov gave RFE/RL copies of all five candidates' financial declarations, which show no foreign contributors to Sklyarov's campaign. Sklyarov has reported collecting about 1.5 billion rubles ($260,000) so far, while Khodyrev has declared only about one-third of that amount in campaign contributions. BANKRUPTCY OFFICIAL ACCUSED OF TAX EVASION. Deputy Procurator-General Yurii Semin has accused Petr Karpov, deputy head of the Federal Bankruptcy Administration, of evading taxes by not declaring income totaling $150,000, Interfax reported on 19 June. Semin said the Procurator-General's Office has informed the tax police about the case. Karpov was recently released from custody pending trial for allegedly taking a 5 million ruble ($870) bribe in 1994. Some observers have argued that the case against him is politically motivated (see "RFE/RL Newsline," 30 May and 4 June 1997). Responding to the latest accusation, Karpov said law-enforcement officials in Saratov Oblast confiscated the $150,000 when he was first arrested on the bribery charges in July 1996. He said he had already explained that he acquired the money by selling a family apartment and receiving a bank loan to buy a house. SECURITY SERVICE TO INVESTIGATE "BLACK TUESDAY" CASE. The Federal Security Service is to investigate whether Russian officials abused their authority to make money out of the 11 October 1994 crash of the ruble, Interfax reported on 19 June, citing an unnamed law enforcement official. The ruble lost about a quarter of its value on "Black Tuesday," prompting calls for the resignation of the government and an eventual cabinet reshuffle, although the Duma failed to pass a vote of no confidence in the government. SAFE SEX CAMPAIGN LAUNCHED IN MOSCOW. The Russian government and the French charity Medicins sans Frontiers have launched a television and billboard advertising campaign in Moscow to help combat the spread of AIDS, Reuters reported on 19 June. The advertisements, which feature the slogan "Safe Sex, My Choice," are aimed at young people and may eventually be brought to other Russian cities. The rate of HIV infection in Russia has increased dramatically in recent years (see "RFE/RL Newsline," 29 May 1997). TRANSCAUCASUS AND CENTRAL ASIA UZBEK PRESIDENT ON RESOLVING NAGORNO-KARABAKH ISSUE. Islam Karimov on 19 June said at a joint news conference with Azerbaijani President Heidar Aliev that there cannot be "two Armenian states in the Caucasus," Interfax reported. Karimov described Baku's position on the settlement of the Nagorno-Karabakh conflict as correct and fair. Azerbaijan is demanding restoration of its sovereignty over the disputed enclave. Aliev, who was wrapping up an official visit to Tashkent, said Azerbaijani-Uzbek relationships have reached "new heights" and that the two presidents share views on "numerous" international issues. A total of 19 bilateral agreements were singed during his visit. TURKMEN PRODUCTION IN DECLINE. The State Statistics Committee has released data showing that in the first five months of 1997, industrial production dropped by 32.7% compared with the same period last year, according to the Russian daily "Delovoi Mir" on 19 June. While the gas and gas refining industries registered an increase of 1.8% and 100%, respectively, this was insufficient to offset declines in output in the electricity sector (19.6%) , the chemical and petrochemical industries (25.1%), and cotton (25%). Reduction in supplies of natural gas to several CIS states that have not yet paid their debts account for a 44% decrease in natural gas output. Gasoline and diesel fuel production also dropped 29.7% and 12.4%, respectively. xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx Copyright (c) 1997 RFE/RL, Inc. 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