We are always the same age inside. - Gertrude Stein
RFE/RL NEWSLINE

RFE/RL NEWSLINE Vol 1, No. 92, Part I, 11 August1997



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

* YELTSIN MEETS WITH NORTH OSSETIAN, INGUSH
PRESIDENTS

* YELTSIN, CHUBAIS ON IMPLICATIONS OF RUBLE
REDENOMINATION

* RENEWED FIGHTING IN TAJIKISTAN

End Note : MOSCOW'S OSTRICH POLICY IN NORTH CAUCASUS

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RUSSIA

YELTSIN MEETS WITH NORTH OSSETIAN, INGUSH
PRESIDENTS. President Boris Yeltsin met with Akhsarbek Galazov
and Ruslan Aushev, the North Ossetian and Ingush leaders, in Moscow
on 8 August and outlined new proposals for stabilizing the situation in
North Ossetia's disputed Prigorodnyi Raion. He also warned the two
leaders to "stop your undeclared war," saying that otherwise he would
withdraw his support in the upcoming presidential elections in both
republics. Yeltsin again rejected Aushev's call for the imposition of
presidential rule on Prigorodnyi Raion and declined to send any
additional Russian Interior Ministry troops there. He proposed a
moratorium of 15-20 years on territorial claims and promised to
maintain federal funding for Prigorodnyi Raion at 200 billion rubles
($34.5 million) for 1997-1998 to rebuild housing for Ingush refugees.
The proposals, which Galazov termed "wise and far-sighted," are to be
formalized in an agreement that all three presidents are scheduled to
sign later this month, according to Interfax (see also "End Note" below).

YELTSIN, CHUBAIS ON IMPLICATIONS OF RUBLE
REDENOMINATION. Speaking to reporters on 8 August, Yeltsin
indicated that the money supply will increase in 1998 as new bank notes
are issued while old bank notes remain in circulation, Russian media
reported. However, First Deputy Prime Minister Anatolii Chubais said
the same day that an increase in the number of bank notes in circulation
at the beginning of 1998 will not increase the overall money supply,
Interfax reported. Central Bank official Denis Kiselev also contradicted
Yeltsin, saying new bank notes will be issued only as old notes are
withdrawn from circulation. Yeltsin has promised that the planned ruble
redenomination will not hurt ordinary Russians and has said it
represents the government's triumph over inflation (see "RFE/RL
Newsline," 8 August 1997).

OFFICIAL SAYS CURRENCY REFORM WILL SAVE STATE
MONEY. Central Bank First Deputy Chairman Sergei Aleksashenko
says issuing new ruble bank notes and reintroducing coins for kopecks
and the smallest ruble denominations will save the state money in the
long run. In an interview with RFE/RL's Moscow bureau broadcast on
10 August, Aleksashenko said the average bank note remains in
circulation for only two to two-and-a-half years. Although in the short
term it is more expensive to mint coins than to print bills, he noted that
coins typically stay in circulation for 30 years, while bank notes must
continually be reprinted as they wear out. Aleksashenko also said that in
preparation for the currency reform, during the last year only new
ruble bank notes (with three zeroes removed) have been printed.

ZYUGANOV SKEPTICAL ON CURRENCY REFORM... Communist
Party leader Gennadii Zyuganov on 8 August described the planned
redenomination of the ruble as "hasty, premature, poorly thought-out,
and poorly calculated," RFE/RL's Moscow bureau reported. He added
that there has not been a single reform implemented by Yeltsin "that has
not made the people's wallets thinner." Zyuganov claimed that by
announcing plans to issue new coins and bank notes, the government
hoped to draw the attention of ordinary citizens away from other
"destructive transformations," such as the sale of state property.
Zyuganov also predicted that the currency change will prompt Russians
to put more of their savings into U.S. dollars. He charged that First
Deputy Prime Minister Chubais is trying to boost the dollar's value.

...DESCRIBES OPPOSITION'S EFFORTS TO BREAK THROUGH
"INFORMATION BLOCKADE." Also on 8 August, Zyuganov
described the opposition's attempts to break through what he called an
"information blockade" imposed by media outlets that are sympathetic to
the president and government. At a press conference to mark the first
anniversary of the creation of the Communist-led movement Popular-
Patriotic Union of Russia (NPSR), Zyuganov said the opposition has
some 300 newspapers and other publications as well as three radio
stations, Russian media reported. In addition, the NPSR has set up a
Patriotic Information Agency and plans to broadcast its own television
programs on various regional networks, Zyuganov said. Earlier this
year, the government promised that the state-run Russian Television
network would broadcast a program about the activities of the
parliament, which the opposition has long demanded. However, such a
program has not yet appeared.

AUDIT CONCLUDES NO LAWS BROKEN IN NORILSK NICKEL
AUCTION. Officials from the State Property Committee, the Russian
Federal Property Fund, and the Procurator-General's Office have
concluded that no laws were broken in the recent sale of a 38 percent
stake in Norilsk Nickel, ITAR-TASS reported on 11 August, citing an
unnamed government source. That source said First Deputy Prime
Minister Chubais will soon present the conclusions of the audit to Prime
Minister Viktor Chernomyrdin. The premier called for the Norilsk
auction to be postponed but was later persuaded to let it go ahead on 5
August. He then ordered government officials to examine how the sale
had been conducted (see "RFE/RL Newsline," 5-8 August 1997).

AUCTION MAY STILL BE CONTESTED IN COURT. Rival
companies may still contest the Norilsk auction in an arbitration court,
claiming the terms of the sale were unfair, "Kommersant-Daily"
reported on 9 August. In addition, the Procurator-General's Office may
sue to annul the sale if it determines that the auction violated Russian
state interests. Critics have noted that Oneksimbank had managed the 38
percent stake in Norilsk Nickel since November 1995. Moreover, the
bank is linked both to the company that organized the auction (MFK-
Moscow Partners) and to the company that submitted the winning bid
(Svift). "Kommersant-Daily" claimed that Oneksimbank also has links to
the little-known consortium that submitted the losing bid for the Norilsk
stake. However, the newspaper said Russian law appears to be on
Oneksimbank's side. Affiliates of share managers or sale organizers are
not prohibited from taking part in privatization auctions.

NEWSPAPER CLOSE TO ONEKSIMBANK CRITICIZES
CHERNOMYRDIN. "Komsomolskaya pravda" on 9 August argued that,
in the recent sale of stakes in Svyazinvest and Norilsk Nickel, First
Deputy Prime Ministers Chubais and Boris Nemtsov had "for the first
time in Russia's recent history rebuffed attempts by groups of influential
lobbyists to continue playing the game according to their own 'shadowy'
rules." In contrast, the paper argued, Prime Minister Chernomyrdin had
"become a hostage of financial groups." "Komsomolskaya pravda"
claimed that Chernomyrdin advocated postponing the Norilsk auction
not because of a recommendation from the Procurator-General's Office
but under the influence of Security Council Deputy Secretary Boris
Berezovskii, founder of the powerful LogoVAZ empire. Chernomyrdin
changed his mind about postponing the Norilsk sale following
discussions with Chubais, State Property Committee Chairman Alfred
Kokh, and Oneksimbank President Vladimir Potanin on 5 August.
Oneksimbank is a major shareholder in "Komsomolskaya pravda."

ONEKSIMBANK AFFILIATE SEEN EXPANDING ITS INFLUENCE
OVER ST. PETERSBURG PRESS. Baltoneksimbank, a St. Petersburg-
based affiliate of Oneksimbank, has extended credits to four of the city's
five daily newspapers, "Kommersant-Daily" reported on 9 August. The
total value of the loans granted to "Vechernii Peterburg," "Sankt-
Peterburgskie vedomosti," "Nevskoe vremya," and "Chas pik" is 1
billion rubles ($172,000). It is not known when the newspapers must
repay the loans or what they offered as collateral. According to
"Nevskoe vremya" editor-in-chief Alla Manilova, the papers negotiated
with four different banks and chose to borrow from Baltoneksimbank
because it offered the credits on the best terms. "Kommersant-Daily"
argued that the deal will allow Baltoneksimbank to significantly increase
its influence over leading St. Petersburg publications.

STROEV SAYS REGIONS SHOULD TAKE PART IN
DISTRIBUTION OF PROPERTY... Federation Council Speaker Yegor
Stroev has proposed that the government and regional leaders form a
joint commission on policies toward state property and the energy
sector, ITAR-TASS reported on 8 August. In a message to the
government, Stroev suggested that such a commission could include
Moscow Mayor Yurii Luzhkov, St. Petersburg Governor Vladimir
Yakovlev, and representatives from various Federation Council
committees. Noting that currently the federal authorities control the
distribution of profits from privatized property, Stroev told journalists
that regional leaders should be involved as well. By way of example, he
said that the governor of Krasnoyarsk Krai should have participated in
decisions surrounding the privatization of a 38 percent stake in Norilsk
Nickel. Stroev added that regional authorities should have some say over
the distribution of timber, gas, and other natural resources located on
the territory of their regions.

...AS SAMARA GOVERNOR EYES AVTOVAZ SHARES. Samara
Oblast Governor Konstantin Titov says that if the government acquires a
controlling packet of shares in the automobile manufacturer AvtoVAZ,
some of the shares should be transferred to the Samara authorities,
"Kommersant-Daily" reported on 8 August. The AvtoVAZ board of
directors on 2 August agreed to a 10-year schedule for paying off the
company's 2.855 trillion rubles ($492 million) in tax debts to the federal
budget. If the company fails to meet this schedule, the federal
government will take over 51 percent of the company's shares.
AvtoVAZ is based in the city of Togliatti and owes debts to the Samara
Oblast budget as well as to the federal government. Titov believes those
factors should be taken into account if the government acquires a
controlling stake in AvtoVAZ. He has vowed to raise the issue with State
Property Committee Chairman Alfred Kokh.

GOVERNMENT APPROVES CONCEPT FOR RESTRUCTURING
HEALTH CARE. Following a report by Health Minister Tatyana
Dmitrieva, the government on 7 August approved a concept for
restructuring the public health care system by 2005, RFE/RL's Moscow
bureau reported. A final program is to be adopted in the coming weeks.
Dmitrieva told journalists that basic medical services will still be
provided free of charge and will be financed through mandatory
medical insurance. Some other medical services -- such as cosmetic
surgery, physiotherapy, and massage therapy -- will become fee-based.
However, Dmitrieva promised that the poor will still be able to receive
such services free of charge if a doctor prescribes them. According to
Interfax, the new program will force hospitals and clinics currently
closed to the public to join the national system. Dmitrieva said more
than 20 federal agencies have special medical facilities that are funded
by the federal budget but closed to the public.

SUPREME COURT FINDS IN FAVOR OF JOURNALIST DEPRIVED
OF ACCREDITATION. The Supreme Court has ordered the Primorskii
Krai authorities to restore accreditation to Denis Demkin, the Far East
correspondent for "Kommersant-Daily," the paper reported on 7
August. Demkin's accreditation was revoked in April. Governor
Yevgenii Nazdratenko's press secretary charged that Demkin had spread
false information in violation of the federal law on the mass media. The
Primorskii Krai Court turned down an appeal from "Kommersant-
Daily," saying the law on the mass media does not specify on what
grounds a journalist's accreditation may be revoked. However, the
Supreme Court ruled that regional or local authorities cannot establish
their own rules for enforcing the federal law on the mass media. The
court also found that under Article 55 of the constitution, rights and
freedoms may be limited in extenuating circumstances only by federal
law, not by governors or regional administrations.

TRANSCAUCASUS AND CENTRAL ASIA

RENEWED FIGHTING IN TAJIKISTAN. Fighting erupted in northern
Dushanbe on 9 August between Interior Ministry forces headed by Col.
Sukhrob Kasymov and some 200 supporters of Yakub Salimov, former
interior minister and current customs committee chairman. Salimov
withdrew westward from Dushanbe to Gissar after several dozen of his
men were killed, according to AFP. Also on 9 August, maverick
military commander Makhmud Khudoiberdiev, who since January 1996
has twice launched unsuccessful attempts to overthrow Tajik President
Imomali Rakhmonov, threatened to advance on Dushanbe from his base
near Kurgan-Tyube to the south unless Kasymov left the capital,
according to Reuters. Presidential guard commander Gafar Mirzoev
told AFP on 10 August that Khudoiberdiev's forces were advancing on
the capital in order to oust Rakhmonov. Khudoiberdiev issued a denial,
claiming his forces were attacked by the presidential guard. He also
pledged his loyalty to the president.

TAJIK SECURITY COUNCIL CONVENES. Addressing a session of
the Tajik Security Council on 10 August, Rakhmonov blamed the
renewed violence on "destructive forces" intent on undermining the
peace agreement signed between the Tajik government and opposition in
late June. The council issued a statement claiming that the fighting was
initiated by "the economic and drugs mafia and the criminal world." It
also called on the warring parties to surrender their arms within three
days, according to Reuters. Sporadic clashes between Kasymov's and
Salimov's forces continued west of Dushanbe throughout the night of
10-11 August. ITAR-TASS on 11 August reported that the situation in
Dushanbe is calm, public transport is running, and some shops are open.
It is unclear whether fighting is continuing in the Fakhrabad mountain
pass, some 40 kilometers south of Dushanbe, where Khudoiberdiev's
forces clashed with the presidential guard on 10 August, according to
dpa.

ARMENIA, RUSSIA AGREE ON CFE QUOTA. The Russian and
Armenian Foreign Ministries have exchanged notes affirming that
Armenia will maintain the present weapons allocations stipulated by the
1990 Treaty on Conventional Forces in Europe, RFE/RL's Yerevan
bureau reported on 8 August, quoting Foreign Ministry spokesman
Armen Gasparyan. Armenia had ceded part of its arms allocations in
tanks, personnel carriers, and artillery to the Russian troops stationed on
its territory. The Foreign Ministry opposed that move, arguing it could
damage Armenia' s national security vis-a-vis Azerbaijan. Gasparyan
did not specify whether the exchange of notes meant Russia would
reduce the amount of arms at its bases in Armenia to enable Yerevan to
increase its holdings.

DETAINED GEORGIAN WARLORD DECLARES HUNGER
STRIKE. Djaba Ioseliani, leader of the banned Mkhedrioni paramilitary
formation, has declared a hunger strike to demand his release from
detention and a meeting with UN and Council of Europe representatives,
ITAR-TASS reported on 9 August, citing the Georgian press. Ioseliani
was instrumental in forcing the 1992 ouster of President Zviad
Gamsakhurdia and in bringing back former Soviet Foreign Minister
Eduard Shevardnadze to his native Georgia. Ioseliani was arrested in
November 1995, and has been charged with high treason, murder,
banditry, and terrorism, including the unsuccessful car bomb attack on
Shevardnadze in August 1995. Ioseliani's trial is scheduled to begin in
September. Meanwhile, the Georgian presidential press service on 8
August said the Interior Ministry has evidence that another terrorist act
against Shevardnadze is being prepared in an unnamed foreign country,
ITAR-TASS reported.

RAIL TRAFFIC RESUMES BETWEEN MOSCOW, TBILISI.
Following an interruption of nearly three years, a train left Tbilisi
bound for Moscow at midnight on 7 August, ITAR-TASS reported. The
Tbilisi-Moscow service will run once a week and will be protected by
armed guards, "Rezonansi" reported on 7 August.

EXPLOSION NEAR U.S. EMBASSY IN BAKU. A small explosion was
reported near the U.S. embassy in Baku on 8 August, Interfax reported.
No one was injured, nor was the building damaged. Turan the next day
cited a district police official as saying the explosion occurred when
teenagers set fire to an old TV set. Earlier the same day, President
Heidar Aliev returned from a state visit to the U.S., which Foreign
Minister Hasan Hasanov characterized as a "breakthrough" in bilateral
relations. He added that relations between Washington and Baku have
reached the stage of a "strategic partnership," ITAR-TASS reported on
9 August.

DISPUTE OVER KYAPAZ OIL FIELD CONTINUES. Aliev told
journalists on 8 August that he is not concerned about the withdrawal of
Russian oil companies from the July agreement on joint exploitation and
development of the Kyapaz oil field, Interfax and Turan reported. The
Russian government had announced three days earlier that Rosneft and
LUKoil would withdraw from the deal after the Turkmen Foreign
Ministry protested that Kyapaz lies in Turkmenistan's sector of the
Caspian (see "RFE/RL Newsline," 7-8 July and 6 August, 1997). Aliev
said the agreement signed was one of intent and therefore cannot be
annulled. A senior official of the Azerbaijan state oil company SOCAR
told AFP on 8 August that Azerbaijan's claims to Kyapaz are
indisputable. Prime minister Artur Rasizade said in an interview with
Turan the same day that Azerbaijan has not yet been officially informed
of the Russian withdrawal. He proposed that Azerbaijan and
Turkmenistan jointly develop Kyapaz.

END NOTE

MOSCOW'S OSTRICH POLICY IN NORTH CAUCASUS

by Liz Fuller

        Until recently, the 1994-96 war in Chechnya and the uneasy peace
that followed have eclipsed the unresolved conflict between Chechnya's
western neighbor, Ingushetia, and the Republic of North Ossetia-Alania.
The leaders of the two republics, Ruslan Aushev and Akhsarbek
Galazov, met with Russian President Boris Yeltsin in Moscow on 8
August in an attempt to forestall new violence in North Ossetia's
disputed Prigodonyi Raion.
        The conflict there, like so many on the territory of the former
Soviet Union, is the consequence of Stalin's nationality policy. When the
North Ossetian and Ingush autonomous oblasts were created in 1924,
Prigorodnyi Raion formed the westernmost district of Ingushetia. In
1936, Moscow merged Ingushetia with Chechnya to form the Checheno-
Ingush Autonomous Republic. This formation was abolished following
the 1944 mass deportation of both the Chechens and the Ingush to
Central Asia under suspicion of collaborating with Nazi Germany. At
the same time, Prigorodnyi Raion was incorporated into North Ossetia.
Following Secretary-General Nikita Khrushchev's 1956 "secret speech"
to the 20th congress of the Communist Party of the Soviet Union, a
green light was given for the repatriation of the exiled peoples and for
the reformation of the Chechen-Ingush Autonomous Republic, albeit
within different borders. Prigorodnyi Raion, however, remained part of
North Ossetia.
        The return of the deported Ingush to Prigorodnyi Raion
inevitably created tensions between the Ossetians and the repatriates,
many of whose homes had been occupied by settlers from elsewhere in
the North Caucasus. The Ingush claim that they were routinely subjected
to discrimination on ethnic grounds. But with the exception of fighting
in the North Ossetian capital in late1981, tensions did not escalate into
violence.
        In the late 1980s, Mikhail Gorbachev's policy of glasnost created
the illusion that the Soviet leadership was prepared to redress the most
egregious injustices inflicted by Stalin on the non-Russian peoples.
Beginning in 1991, the Ingush staged repeated demonstrations to
demand that Checheno-Ingushetia again be divided into its two
constituent parts and Prigorodnyi Raion returned to Ingushetia. (In
March 1991, Boris Yeltsin, then chairman of the RSFSR Supreme
Soviet, endorsed the first of those Ingush demands.) The Ossetian
population, for their part, rallied to protest the proposal to hand over
the raion to Ingushetia. In April 1991, the RSFSR Supreme Soviet
adopted a law on the rehabilitation of repressed peoples that implicitly
promised territorial reparations, thereby fueling Ingush hopes. But the
Ossetians succeeded in pressuring Moscow to impose a five-year
moratorium on implementing the legislation. Checheno-Ingushetia was
finally divided into two republics in July 1992.
        Several months later, in October 1992, the accumulated tensions
erupted into fighting in Prigorodnyi Raion between Ingush informal
militias and North Ossetian security forces backed by Russian Interior
Ministry and army troops. In six days of violence, up to 700 people
were killed, hundreds of hostages taken by both sides, and thousands of
homes (mostly belonging to Ingush families) destroyed. Almost the
entire Ingush population of the district (estimates range from 34,000 to
64,000 people) were forced to flee.
        The Russian leadership responded by imposing a state of
emergency in Prigorodnyi Raion and adjacent areas of both North
Ossetia and Ingushetia, which remained in force until February1995.
But direct rule by Moscow has failed to contribute significantly to
defusing tensions and creating conditions for the return of the Ingush.
Most Ingush fugitives are living in temporary accommodation in
Ingushetia. Only an estimated 2,000 have returned to Prigorodnyi
Raion.
        Since early July, interethnic clashes in Prigorodnyi Raion have
risen dramatically, prompting Aushev to appeal to President Boris
Yeltsin to impose presidential rule there. Galazov, however, rejected
that proposal as potentially counterproductive, arguing instead for
increased funding to rebuild destroyed homes and create new jobs for
both Ossetians and returning Ingush. Yeltsin rejected presidential rule as
unconstitutional and "contrary to the direction in which Russian
federalism should develop."
        Meeting with the two republican presidents on 8 August, Yeltsin
proposed tension-defusing measures similar to those agreed on last year
in Chechnya. Those measures include a moratorium of 15-20 years on
territorial claims and the creation of Ossetian-Ingush militia patrols to
maintain the peace. Moscow will allocate 200 billion rubles ($34.5
million) annually for the next two years toward reconstruction in
Prigorodnyi Raion. Galazov expressed satisfaction with those measures,
but Aushev warned the moratorium is tantamount to "burying one's
head in the sand."
        Nor do Yeltsin's proposals address two factors that Russian
observers identify as contributing to the recent upsurge in violence.
First, presidential elections are scheduled for April 1998 in North
Ossetia and Ingushetia, which means both the incumbents and their
prospective rivals risk alienating potential voters if they appear too
conciliatory. Second, the Russian government in early July abolished the
special economic status granted to Ingushetia in June 1994, whereby the
republic is exempt from federal taxes. That move threatens to
undermine the republic's economy and thus create new tensions.


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