We are so bound together that no man can labor for himself alone. Each blow he strikes in his own behalf helps to mold the universe. - K. Jerome
RFE/RL NEWSLINE

RFE/RL NEWSLINE Vol 1, No. 111, Part I, 5 September 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/

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
Headlines, Part I

* YELTSIN SENDS AMENDED RELIGION BILL TO DUMA

* MOSCOW CONDEMNS GROZNY EXECUTIONS

* AZERBAIJAN CONDEMNS TURKMEN OIL TENDER

End Note : MONGOLIA BEGINS TO FIND ITS WAY

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

RUSSIA

YELTSIN SENDS AMENDED RELIGION BILL TO DUMA. President Boris
Yeltsin has sent to the State Duma an amended version of the
controversial law on freedom of conscience and religious
organizations, ITAR-TASS reported on 4 September. Presidential
spokesman Sergei Yastrzhembskii said Yeltsin has sent Duma
Speaker Gennadii Seleznev a letter offering "concrete proposals on
how to correct the bill's flaws." Yastrzhembskii did not give any
details on the updated draft, saying only that it was "approved by
representatives of different faiths and members of parliament." The
original version, passed in June with overwhelming support in the
Duma and from Patriarch of Moscow and All Russia Aleksii II, would
have recognized only Russian Orthodoxy, Islam, Buddhism, and
Judaism as "traditional" religions. The Patriarch recently expressed
his support for the amended legislation, saying "it was not a
compromise for us."

MOSCOW CONDEMNS GROZNY EXECUTIONS. Yeltsin, Prime Minister
Viktor Chernomyrdin, and Seleznev issued statements on 4
September deploring the televised public execution in Grozny the
previous day of a married couple whom an Islamic court had found
guilty of murder. Yeltsin said the execution was "outrageous" and a
violation of Russia's laws and constitution. Chernomyrdin termed the
killings "medieval" and "savage" while Seleznev said they constituted
a "many-sided provocation." Chechen parliamentary spokesman
Ruslan Alikhadzhiev rejected Seleznev's criticism as "illogical,"
according to ITAR-TASS. "Nezavisimaya gazeta" on 5 September
quoted Chechen First Deputy Premier Movladi Udugov as arguing
that if the couple had been sentenced and executed under Russian
law, their relatives would have killed the judge and executioners in
revenge. But, under the requirements of the traditional blood feud,
death sentences handed down by a religious court do not call for a
revenge killing, he added.

CONFUSION OVER CHECHEN OIL ACCORD. Conflicting statements by
Russian officials suggest that a compromise agreement on terms for
the export of Azerbaijan's Caspian oil via the Baku-Grozny-
Tikhoretsk pipeline (see "RFE/RL Newsline," 4 September 1997) is in
jeopardy. Russian First Deputy Prime Minister Boris Nemtsov, who is
also fuel and energy minister, said that Transneft should not be
required to pay the difference between the $0.43 the Russian
government has offered and the $2.20 the Chechens are demanding.
But he denied that the position of his ministry differs from that of
the Security Council. Chechen state oil company president Khozh-
Akhmed Yarikhanov, however, told Interfax later on 4 September
that Russian deputy presidential representative to Chechnya, Anatolii
Chernyshev, had assured him that the Rybkin-mediated agreement
remains in force. Yarikhanov told ITAR-TASS on 5 September that a
compromise agreement may be signed in Moscow the same day but
he declined to reveal its terms.

EXPORT OF EARLY OIL DELAYED AGAIN. Meanwhile in Baku, Terry
Adams, head of the Azerbaijan International Operating Company,
said on 4 September that the first "early" oil from Azerbaijan's Chirag
Caspian field will be exported on 7 November, not on 1 October,
Interfax reported. The original date for the export of the first early
oil was late 1996. Adams did not say whether the latest delay is the
result of Russia's failure to begin repair work to the Baku-Grozny-
Tikhoretsk pipeline.

NORTH OSSETIAN, INGUSH PRESIDENTS SIGN RECONCILIATION
ACCORD. Akhsarbek Galazov and Ruslan Aushev signed an agreement
in Moscow on 4 September aimed at overcoming tensions generated
by the fighting in North Ossetia's Prigorodnyi Raion in November
1992, Russian agencies reported. Chernomyrdin, who was present at
the signing, said the agreement was "a historic move," but he
conceded that "this was not an easy decision." Galazov similarly noted
that implementation of every article of the accord will entail "much
work." Chernomyrdin said that an agreement between North Ossetia,
Ingushetia, and the Russian Federation is being drafted and will be
signed soon. That accord will outline measures to galvanize the local
economies and procedures for residents of one of the two republics
wishing to transit the other, according to ITAR-TASS.

YELTSIN ISSUES DECREE ON UN SANCTIONS AGAINST IRAQ. Yeltsin on
4 September issued a decree calling for strict compliance with the
March 1996 UN Security Council resolution barring the export of
specific goods and technologies to Iraq, Russian agencies reported.
Since early August, 10 Russian oil companies have concluded
agreements to purchase a total of some 34.1 million barrels of Iraqi
oil under the terms of the "oil for food" accord concluded by Iraq and
the UN in December 1996.

MOSCOW PROTESTS TURKISH PLANS TO INSPECT SHIPS IN STRAITS.
Russian Foreign Ministry spokesman Gennadii Tarasov told
journalists in Moscow on 4 September that any attempt by the
Turkish military to detain and search merchant vessels passing
through the Turkish Straits would constitute a violation of the 1936
Treaty of Montreux, Russian agencies reported. The Turkish
authorities have recently detained and searched two ships in an
attempt to prevent the premature shipment by Russia to Greek
Cyprus of S-300 air defense missiles. Turkish Deputy Foreign
Minister Ali Tuygan will soon meet with his Russian counterpart,
Viktor Posuvalyuk, to discuss the missiles question, AFP reported on
4 September.

GOVERNMENT TO EXPLAIN RUBLE REDENOMINATION. Deputy Finance
Minister Alexei Kudrin told journalists on 4 September that the
government will draft an ordinance explaining the ruble
redenomination and what effect, if any, it will have on bank deposits,
Interfax-FIA reported. He added that the ordinance will be made
public within a few days, and he stressed the Kremlin's position that
average Russians will not lose out as a result of the currency
redenomination. Yeltsin has explained his August decision to drop
three zeros from ruble notes and introduce new kopeck coins as the
"government's triumph over inflation." Communist Party leader
Gennadii Zyuganov has called the measure, "hasty, premature, poorly
thought-out, and poorly calculated." He argued there has not been a
single Yeltsin reform "that has not made the people's wallets
thinner."

GOVERNMENT SHARPLY CRITICIZES TAX POLICE. Government leaders
on 4 September admitted serious problems in fighting tax evasion
but sharply criticized the Federal Service of Tax Police (FSNP) for
ineffective work, failure to improve tax collection, and corruption.
Interior Minister Anatolii Kulikov was among the most vocal critics,
saying the FSNP should not request additional powers until it has
mastered its present duties, ITAR-TASS reported. As many as 20 top
officials, including 10 generals, have been dismissed recently for
"personal immodesty and ties with business circles," Kulikov said.
Prime Minister Chernomyrdin said tax evasion poses a serious threat
to the economy. He argued that measures should be stepped up and
coordinated to tackle more sophisticated forms of tax evasion. First
Deputy Prime Minister and Finance Minister Anatolii Chubais said
recent tax collection has not increased government revenues, forcing
the Kremlin to cover expenditures "from privatization revenues and
other sources."

TAX POLICE CHIEF DEFENDS RECORD. At the same cabinet meeting,
FSNP director Sergei Almazov admitted some shortcomings but
argued that his service has limited powers and resources to deal with
the mounting problem of tax evasion, ITAR-TASS reported. He said
tax evasion has more than tripled in the past two years, adding that
FSNP officials opened 9,624 criminal cases in 1996 that resulted in
1,625 convictions. Almazov added that FSNP efforts were hindered
by an outdated tax code. He promised better results in the future.
Tax police officials recently lauded the force as a key component of
the government's attempted crackdown on tax cheats.

DEPUTY DUMA SPEAKER RESIGNS. Aleksander Shokhin has resigned
as deputy speaker of the Duma following his recent promotion to
head the Our Home is Russia (NDR) faction, ITAR-TASS reported on 5
September. Shokhin said that serving as both the deputy speaker
and the head of the NDR would only damages his party's interests. He
said the party will nominate its candidate to fill his post on 10
September. Shokhin had said on 4 September that he was elected
head of NDR to revitalize the party and improve its "image," which
has suffered following the 29 August resignation of former party
leader Sergei Belyaev. Belyaev had accused the fraction of "sliding
toward the principles of bureaucratic, nomenklatura leadership" and
moving toward the communist left.

DEFENSE MINISTER IN KALININGRAD. During a visit to Kaliningrad
Oblast on 4 September, Igor Sergeev said Russia must sell off its old
arms even at "dumping prices" to fund extensive military reforms,
Reuters reported. Sergeev said revenues from the arms sales could
be spent on paying compensation to officers who will lose their jobs
as part of the long-term plan to streamline the armed forces, on
improving conditions for those who stay on, and on buying more
modern arms. Yeltsin in July broke up the virtual monopoly on arms
exports held by state firm Rosvooruzhenie in what analysts say was
a bid to raise funds for reforms and increase Defense Ministry
control over the business. Promexport, the two trading company that
in the future will share arms trade with a reorganized
Rosvooruzhenie, will oversee the sale of surplus Defense Ministry
stockpiles while certain manufacturers will be able to sell their
output directly.

EX-KGB GENERAL DENIES SEEKING PERMANENT U.S. RESIDENCE. In an
interview with an RFE/RL Washington correspondent on 4
September, former KGB Maj.-Gen. Oleg Kalugin has denied a
"Washington Post" report that he is seeking permanent residence in
the U.S., Kalugin has lived in the U.S. since 1995 and currently works
for the Washington-based consulting firm Intercon USA. He said his
employer has expressed an interest in retaining him once his work
permit expires in 1998, but he stressed that no papers have been
filed with the U.S. government. However, he did not rule out
eventually seeking permanent U.S. residency, explaining his life
could be in danger if he were to return to Russia, where he says he is
vilified and branded a traitor by many former Soviet officials.
Kalugin has admitted he played a role in the death of a U.S. double
agent when he worked as a Soviet counter-intelligence chief.

HERZOG WRAPS UP RUSSIAN VISIT WITH TRIP TO SAMARA. At the
close of his five-day visit to Russia, German President Roman Herzog
traveled to Samara on 4 September to visit a German economic fair,
dpa and ITAR-TASS reported. "Our economic cooperation with Russia
is a guarantee of stability and security," Herzog said in his opening
address to the fair. Konstantin Titov, the governor of the region, said
the event, which was attended by more than 70 major German
companies, aimed at consolidating the area's business contacts with
Germany. Only about 12,000 ethnic Germans now live in Samara,
according to Interfax. Most were deported from the region to Siberia
and Kazakhstan by Stalin at the outbreak of World War Two.

YELTSIN CONGRATULATES MUSCOVITES ON 850TH ANNIVERSARY.
President Yeltsin acknowledged the role of Moscow in the "birth of
Russian democracy" in a nationwide radio address on 5 September to
mark the city's 850th anniversary, ITAR-TASS reported. Festivities
are scheduled to get under way with a gala concert on Red Square,
starring Italian tenor Luciano Pavarotti. On 6 September, they will
continue with a parade and a spectacular laser show by French pop
star Jean-Michel Jarre. With meteorologists forecasting rain, Moscow
Mayor Yurii Luzkhov has ordered aircraft to fly for hours seeding
storm clouds, which delays the formation of rain droplets. According
to AFP, the operation will cost Moscow some $500,000.

TRANSCAUCASUS AND CENTRAL ASIA

AZERBAIJAN CONDEMNS TURKMEN OIL TENDER. President Heidar
Aliev on 4 September said the tender launched by Turkmenistan for
several Caspian oil fields is "illegal", Interfax reported. The tender
covers the Kyapaz field (Serdar in Turkmen), which Azerbaijan's
state oil company SOCAR had intended to develop jointly with two
Russian companies. Prime Minister Artur Rasi-Zade similarly termed
the tender "still-born" and predicted that no "serious" Western
company would bid. Foreign Minister Hasan Hasanov suggested that
Turkmenistan was instigated to declare the tender either by
Armenia or by some other country interested in preventing
Azerbaijan, Turkmenistan, and Kazakhstan from exploiting their
Caspian oil.

U.S.-ARMENIAN RELATIONS "DEVELOPING RAPIDLY." Recently
appointed Deputy Foreign Minister Armen Bayburtyan told
journalists in Yerevan on 4 September that the U.S. has become "one
of Armenia's most important partners", RFE/RL's Yerevan bureau
reported. Bayburtyan cited the "unprecedented" fact that four U.S.
Congressional delegations have visited Armenia in recent weeks. At
the same time, he noted that the so-called Azerbaijani oil factor
"affects" U.S.-Armenian bilateral ties. Bayburtyan said the World
Bank's recent evaluation of Armenia as "a solvent country" is
expected to stimulate U.S. investment in that country, according to
Interfax.

ARMENIAN ECONOMIC ADVISER ON 1997 BUDGET. Implementation of
the1997 Armenian budget is "unsatisfactory," presidential economic
adviser Vahan Khachatryan told the Armenpress state news agency
in an interview published in the 4 September issue of "Hayastani
Hanrapetutyun." Khachatryan said budget revenues are being
collected only with great difficulty and that recent changes in
Armenia's tax legislation have led many small and medium-sized
businesses to stop their activities. "Taxes must not be collected at any
cost, because in the end there will be no one to pay them. We are
now very close to such a situation," Khachatryan argued. He said that
"businessmen are now forced to pay in advance value-added tax for
October and November." He also expressed concern that the
privatization process is losing momentum.

RUSSIA CRACKS DOWN ON ARMENIAN EMIGRANTS. The Russian
Federal Migration Service is seeking to halt emigration from Armenia
to Russia and will refuse entry to Russia to people who lack the
necessary documents, "Segodnya" reported on 1 September.
Estimates of the number of Armenians who in recent years have
emigrated to Russia in search of employment range from 400,000 to
700,000. Armenia has a total population of 3.5 million. Noyan Tapan
on 3 September quoted an Armenian Ministry of Social Welfare
official as staying that national employment agencies have helped 40
Armenians find employment in Russia over the past year. He said the
ministry had concluded agreements with several unspecified CIS
states on unrestricted migration.

TAJIK OPPOSITION FIGHTERS EN ROUTE TO DUSHANBE. The first
group of fighters from the United Tajik Opposition (UTO) left central
Tajikistan for the capital on 5 September, RFE/RL correspondents
reported. Under the June peace agreement, the fighters are to act as
bodyguards for UTO leaders who are scheduled to return to
Dushanbe on 8 September to take up their duties as members of the
National Reconciliation Council. Overseeing the movement of the
fighters are the CIS peacekeeping force as well as representatives
from the government, the UTO, and the UN observer mission to
Tajikistan. Another 200 UTO fighters will arrive in Dushanbe later
and will also serve as bodyguards.

WILD FIRES THREATEN KAZAKH CITY. Wild fires have reached the
outskirts of Karaganda, in north-central Kazakhstan, AFP reported on
5 September. The fires have already swept across more than 75,000
hectares of land, aided by high winds. At least one firefighter is
reported dead in efforts to keep the fires from reaching Karaganda. A
mild winter and a hot summer combined to devastate large tracts of
steppe and forest in the northern regions of Kazakhstan.

"NO RUSSIAN TROOPS" IN UZBEKISTAN. The Russian Foreign Ministry
has issued a statement rejecting as untrue an article published in
August by "Moskovskii Komsomolets" claiming that a Russian
division is currently deployed in Uzbekistan, "Segodnya" reported on
4 September, citing Foreign Ministry spokesman Gennadii Tarasov.
Tarasov said the article has generated embarrassment within
informed circles and alarm among the uninformed.

TURKMEN PRESIDENT RECUPERATES IN GERMANY. Saparmurat
Niyazov will remain in a German hospital until at least mid-
September to recover from his 1 September heart surgery, ITAR-
TASS and Reuters reported on 4 September. Doctors say Niyazov is
making progress, but they have advised him to remain in Germany
for the standard two-week recovery period.

END NOTE

MONGOLIA BEGINS TO FIND ITS WAY

by Robert Lyle

        Overshadowed by its two giant neighbors, Mongolia often
seems forgotten by the rest of the world. While Russia and China
have kept the world's attention with their different approaches to
transforming from central planning to market economies,
Ulaanbaatar has quietly bounced from one side to another.
        But in its first review of Mongolia's economy to be released
publicly, the International Monetary Fund (IMF) concludes that while
major weaknesses remain, Mongolian authorities are now on the
right track and have been taking the tough steps necessary to put
the country's economy on a path of sustained growth and
development. A program of transition and reform launched in the
early 1990s had been derailed by 1995. Extensive central bank
credit fueled inflation and the budget deficit, and trade barriers on
both exports and imports caused the Asian Development Bank and
the U.S. to suspend assistance programs.
        But the IMF said that in the second half of 1996, Mongolian
authorities began implementing a wide-ranging program of
monetary, fiscal, and structural reforms designed to reduce the
public sector and promote rapid development of the private sector.
Most important, the fund argued, authorities launched a major bank
restructuring program, which included the immediate closure of two
large insolvent banks and the clearing of nonperforming loans that
had been made by the banks at the government's direction. Along
with a significant tightening of monetary policy by the central bank,
those measures helped curtail inflation, stabilize the exchange rate,
and halt the decline in bank deposits.
        The fund particularly praised what it called the authorities'
"bold and ambitious approach to reforms." That approach included
programs aimed at streamlining government operations and reducing
distortions in the tax system. As a major first step in straightening
out twists in the tax system, the 1997 budget eliminated virtually all
import duties, "making Mongolia one of the most open trade regimes
in the world." In addition, the government reduced direct taxes,
extended the base of the sale taxes, and raised excise taxes on
alcohol, automobiles, and petroleum.
        The IMF said the willingness of Mongolian leaders to take
"politically difficult steps at an early stage" provided "convincing
evidence of their strong commitment to the reform process." But it
noted that Mongolia still has a long way to go. The country's
economic situation remains difficult, and current economic policy
does carry risks, particularly in getting the government's fiscal
situation in order. Mongolia has a weak banking system, a distorted
tax system, a large and inefficient public sector, and an inadequate
legal infrastructure.
        The IMF urged the Mongolian government to renew its attack
on inflation, push ahead on tax reforms -- including imposition of a
broad-based value-added tax -- and put new emphasis on
privatization. The fund said this would require "early sales of large
profitable [state] enterprises and the restructuring of some loss-
making enterprises." It estimated that in 1997, Mongolia will record
a real growth in gross domestic product of 3 percent and annual
inflation of 31 percent.
        With a population of fewer than 2.5 million people and a land
area of more than 1.5 million square kilometers, Mongolia had a
1995 GDP of $767 million $310 per capita, according to the World
Bank. Its per capita GDP was lower than any recorded by a former
Soviet republic, putting Mongolia among the poorest nations of Africa
and southern Asia.

The author is a Washington-based correspondent for RFE/RL.


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

SUBSCRIBING:
1) To subscribe to RFERL-L, please send a message to
        listserv@listserv.acsu.buffalo.edu
2) In the text of your message, type
        subscribe RFERL-L YourFirstName YourLastName
3) Send the message

UNSUBSCRIBING:
1) To un-subscribe to RFERL-L, please send a message to
        listserv@listserv.acsu.buffalo.edu
2) In the text of your message, type
        unsubscribe RFERL-L
3) Send the message

Current and Back Issues of RFE/RL Newsline
RFE/RL Newsline is available online via:
http://www.rferl.org/newsline/

Back Issues of OMRI Daily Digest
Back issues of the OMRI Daily Digest are available online via:
http://www.omri.cz/publications/dd/
ftp://ftp.omri.cz/pub/dailydigest/

Reprint Policy
To receive reprint permission, please contact
Paul Goble, Publisher
Email: GobleP@rferl.org
Phone: 202-457-6947
Fax: 202-457-6992
Postal Address:  RFE/RL,  1201 Connecticut Ave., NW
Washington, DC  20036  USA

RFE/RL Newsline Staff:
* Paul Goble, Publisher, GobleP@rferl.org
* Liz Fuller, Acting Editor (Transcaucasia) CarlsonE@rferl.org
* Patrick Moore, Acting Deputy Editor (West Balkans)  MooreP@rferl.org
* Michael Shafir (East Balkans) ShafirM@rferl.org
* Laura Belin (Russia) BelinL@rferl.org
* Bruce Pannier (Central Asia) PannierB@rferl.org
* Jan Cleave, CleaveJ@rferl.org
* Mike Gallant, GallantM@rferl.org

RFE/RL Newsline Fax: (420-2) 2112-3630

[English] [Russian TRANS | KOI8 | ALT | WIN | MAC | ISO5]

F&P Home ° Comments ° Guestbook


1996 Friends and Partners
Natasha Bulashova, Greg Cole
Please visit the Russian and American mirror sites of Friends and Partners.
Updated: 1998-11-

Please write to us with your comments and suggestions.

F&P Quick Search
Main Sections
Home
Bulletin Board
Chat Room
F&P Listserver

RFE/RL
1999
1998
1997
1996
1995
1994
1993
1992
1991
Search

News
News From Russia/NIS
News About Russia/NIS
Newspapers & Magazines
Global News
Weather

©1996 Friends and Partners
Please write to us with any comments, questions or suggestions -- Natasha Bulashova, Greg Cole