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RFE/RL NEWSLINE Vol 1, No. 124, Part I, 24 September 1997
A daily report of developments in Eastern and Southeastern Europe, Russia, the Caucasus and Central Asia prepared by the staff of Radio Free Europe/Radio Liberty. This is Part I, a compilation of news concerning Russia, Transcaucasia and Central Asia. Part II covers Central, Eastern, and Southeastern Europe and is distributed simultaneously as a second document. Back issues of RFE/RL NewsLine and the OMRI Daily Digest are online at RFE/RL's Web site: http://www.rferl.org/newsline ECONOMIC NEWS from this week's annual meeting of the IMF and World Bank is online at RFE/RL's Web site: http://www.rferl.org/nca/special/imfmeeting/index.html xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx Headlines, Part I *YELTSIN CALLS FOR "NEW ECONOMIC ORDER" *FEDERATION COUNCIL APPROVES RELIGION LAW *MINSK GROUP CO-CHAIRMEN IN BAKU xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx RUSSIA YELTSIN CALLS FOR "NEW ECONOMIC ORDER." President Boris Yeltsin says Russia needs a "new economic order," whereby the state has a stronger role, in order to achieve economic growth in 1998, RFE/RL's Moscow bureau reported on 24 September. In a 30-minute televised speech at the opening of the fall session of the Federation Council, Yeltsin said that while the government will not interfere in legal business activities, it will not tolerate any "attempts by businesses or banks to put pressure on it." Yeltsin added that businessmen "must serve society and work for the benefit of Russian citizens." The president also said the government has begun to "tackle the economic roots of corruption" by establishing "strict control" over state funds. In 1998, he pledged, all federal government accounts will be transferred from commercial banks to a Federal Treasury. YELTSIN OFFERS TO DISCUSS BUDGET WITH REGIONS... In his speech to the Federation Council, Yeltsin called on deputies to approve tax reform and a "realistic budget" for 1998, which, he said, will secure an economic "breakthrough." But he also offered regional leaders some concessions and promised that the government will consult them on revising the draft tax code and the 1998 budget. In the future, Yeltsin said, enterprises in the regions will pay their federal and regional taxes through regional branches of the Federal Treasury, rather than directly to Treasury offices in Moscow, an RFE/RL correspondent in the Russian capital reported. But Yeltsin confirmed that regional governments will bear half the burden for paying wage arrears to state employees, ITAR-TASS reported. Regions must raise 50 percent of the funds needed before the federal government transfers funds to settle the rest of the wage debts, the president said. ...BUT CITES POOR LEADERSHIP IN SOME REGIONS. Yeltsin also criticized unnamed regional leaders who, he said, are "creating 'pocket' [commercial] banks for servicing their own budgets" at a time when the federal government is moving away from authorized banks, ITAR-TASS reported on 24 September. The president also blamed regional leaders for periodic energy crises. "Russia produces enough electricity and fuel," he said, "but an intolerable energy situation is taking shape in some regions because of unsatisfactory leadership." Primorskii Krai has repeatedly suffered energy crises in recent years. An ongoing strike by unpaid coal miners has led to severe power cuts in the krai over the last ten days. In July, the Federation Council passed a resolution asking Yeltsin to rescind decrees whereby many powers had been transferred from Governor Yevgenii Nazdratenko to the president's appointed representative in Primore (see "RFE/RL Newsline," 8 July 1997). GORE-CHERNOMYRDIN TALKS CONTINUE. Meeting in Moscow on 23 September, U.S. Vice President Al Gore and Russian Prime Minister Viktor Chernomyrdin reached an agreement whereby the U.S. will provide $70 million to fund the conversion of three plutonium- producing Siberian nuclear reactors for civilian use, an RFE/RL correspondent in Moscow reported. Chernomyrdin made clear, however, that despite U.S. reservations, Moscow will honor its commitment to supply Iran with some nuclear technology. The energy policy committee of the Gore-Chernomyrdin commission established a special body to protect investors' rights and resolve obstacles to U.S. investment in Russia's oil sector. GORE, YELTSIN MEET. Gore and Yeltsin, meeting in Moscow on 23 September, expressed satisfaction at the current state of bilateral relations. The Russian president noted that many agreements reached at earlier U.S. - Russian summits have been successfully implemented. He praised the work of the Gore-Chernomyrdin commission and of the Russian-U.S. space program, which, he said, symbolized the "new relationship" between the two countries. At the same time, Yeltsin expressed concern over U.S. restrictions on the import of Russian goods. Gore rejected Yeltsin's complaint that the U.S. treats Russia as a "non-market economy." He predicted that new tax legislation will facilitate an upsurge of U.S. investment in Russia. PRIMAKOV ADDRESSES UN ASSEMBLY... Foreign Minister Yevgenii Primakov, addressing the UN General Assembly on 23 September, said the transition to a multipolar world does not solve all the problems confronting mankind. Noting there are many multinational states in the world, he called upon the UN to prevent their "forced disintegration" and to give "maximum rights to ethnic minorities." He added that no one country can assume the role of settling regional conflicts and cited the Middle East as an example, where broad-based international efforts could "undo the tight knot." He also noted that cooperation between the UN and Russia has led to a peaceful solution of problems in Tajikistan and that Russia's participation, along with the U.S. and France, was a positive factor in mediating the dispute over the unrecognized Nagorno-Karabakh Republic. ...DISCUSSES NATO, NUCLEAR ARMS. Primakov also criticized NATO enlargement, which, he commented, "does not proceed from existing reality" and creates "new division lines." He repeated Russia's promise to guarantee the security of the Baltic States. Primakov also pointed out that Russia and the U.S. have already agreed to "basic parameters" for START-III talks and that their nuclear arsenals would soon be cut by 80 percent, compared with the Cold War era. However, Primakov blasted countries such as Pakistan, India, and Israel for failing last year to sign the treaty on a comprehensive ban on nuclear tests. "They must understand that their own security is an integral part of universal security," he said. FEDERATION COUNCIL APPROVES RELIGION LAW. The Federation Council unanimously approved the law on freedom of conscience and religious organizations at its opening fall session on 24 September, Russian news agencies reported. The previous day, presidential spokesman Sergei Yastrzhembskii announced that Yeltsin is happy with the revised religion law and that there is every reason to expect the president will sign the law once it has been approved by the Council. Yeltsin vetoed an earlier version, saying it violated the constitution and Russia's international commitments (see "RFE/RL Newsline," 23 July and 22 September 1997). DUMA OVERRIDES VETO OF LAND CODE. The State Duma on 24 September voted by 304 to 52, with five abstentions, to override a presidential veto of the Land Code, ITAR-TASS and RFE/RL's Moscow bureau reported. Yeltsin vetoed the code primarily because it would ban the purchase and sale of farmland (see "RFE/RL Newsline," 12 June and 7 July 1997). Yeltsin's representative in the Duma, Aleksandr Kotenkov, denounced the vote as "falsified," saying only 184 deputies were in the chamber at the time. Kotenkov said the president may appeal to the Constitutional Court against parliamentary voting procedures he considers unconstitutional. In the summer, Yeltsin refused to sign two laws after both houses of parliament overrode his vetoes. The president objected to proxy voting in the Duma and to a procedure whereby Federation Council deputies who are not in Moscow may mail in ballots. MUBARAK IN MOSCOW. On his first-ever official visit to Moscow, Egyptian President Hosni Mubarak met with Yeltsin on 23 September to discuss a broad range of issues, including bilateral ties, the situation in the Middle East, and Libya. The two presidents later issued a joint declaration affirming their commitment to creating a multipolar world. Russian presidential spokesman Yastrzhembskii told journalists that the two presidents had reached a "high level of mutual understanding." He characterized the atmosphere at the talks as "warm" and "excellent," according to ITAR-TASS. Mubarak also met with Russian Prime Minister Viktor Chernomyrdin and First Deputy Prime Minister Boris Nemtsov to discuss economic cooperation. Inter-government agreements on avoiding dual taxation, protection of investments, transportation, and legal issues were signed. YELTSIN CRITICIZES ISRAEL FOR OBSTRUCTING MIDDLE EAST PEACE. Addressing reporters after his talks with Mubarak, Yeltsin blamed Israel for obstructing the Middle East peace process and called on the U.S. to be "more active" in trying to persuade Israel to resume negotiations. Yeltsin added, however, that Russia too should play a more active role in the peace talks. According to Interfax, he subsequently instructed the Russian government to prepare proposals on how best to accomplish that goal. Yeltsin also affirmed his commitment to the "land for peace" formula and rejected as "not serious" accusations that Palestinian leader Yasser Arafat was to blame for the recent terrorist bombings in Israel. Mubarak, for his part, said in an interview published in "Nezavisimaya gazeta" on 23 September that although Russia and U.S. are co-sponsors of the Middle East peace process, "we do not see any moves on the part of Russia." IS CHECHNYA'S PRESIDENT IRRELEVANT? "Segodnya" on 23 September claims that political developments in Chechnya are determined more by the interaction of traditional clans than by state structures. The daily suggested that Moscow's unswerving support for President Aslan Maskhadov, considered the most pragmatic and flexible politician with whom to conduct negotiations, may therefore be misguided and even counterproductive. It also claims that those persons who currently exercise real power in Chechnya have retreated from the limelight and that specific clans control foreign policy (except for ties with Russia) and the underground oil extraction and refining industry. SVYAZINVEST DEAL PRONOUNCED LEGAL. The State Anti-Monopoly Committee, the Justice Ministry, and the Federal Service for Currency and Export Controls have submitted a joint report to the government declaring that no laws were broken in the July sale of a 25 percent plus one share in the telecommunications giant Svyazinvest, ITAR- TASS reported on 23 September, citing government spokesman Igor Shabdurasulov. Prime Minister Chernomyrdin ordered the probe following allegations that the Cyprus-based consortium Mustcom, Ltd., which submitted the winning bid for Svyazinvest, had broken laws on hard currency transactions (see "RFE/RL Newsline," 13 August 1997). Oneksimbank led the Mustcom consortium. ZYUGANOV STANDS BY CRITICISM OF YELTSIN. Communist Party leader Gennadii Zyuganov has said there is "nothing illegal" about his recent criticism of the authorities, and he will not take back any of his statements, ITAR-TASS reported on 23 September. Addressing the founding congress of Duma Defense Committee Chairman Lev Rokhlin's Movement in Support of the Army on 20 September, Zyuganov had called Yeltsin the "ringleader" of a regime that is carrying out a "criminal policy" and "destroying the country." Yeltsin slammed Zyuganov's remarks as "political blackmail" and told Interior Minister Anatolii Kulikov on 22 September that "those who shout from the podium that the leaders are gangsters must be made to answer," Interfax reported. The same day, the Justice Ministry released a statement saying comments made by Communist Party figures at the 20 September congress are "unacceptable and beneath the dignity of politicians of such a level." LUZHKOV RESPONDS TO CRITICISM BY NEMTSOV. Moscow Mayor Yurii Luzhkov has dismissed recent criticism of his city's policies by First Deputy Prime Minister Nemtsov as "unfounded" and "poorly thought-out," Russian news agencies reported on 23 September. Nemtsov argued that subsidies for rents and for municipal services in the capital are too "extravagant" and that Moscow is spending too much on the construction of a ring road (see "RFE/RL Newsline," 19 September 1997). Luzhkov said Nemtsov's remarks did not take into account the capital's unique characteristics. He added that Nemtsov knows little about road construction and that the ring road costs less than equivalent projects in other countries. He called on Nemtsov to make "responsible" statements and vowed not to keep silent when city leaders "are accused of incompetence." Luzhkov and Nemtsov are both likely to contest the next Russian presidential election. FEDERAL COMMISSION TO INVESTIGATE AUTHORITIES IN SIBERIAN CITY. A special commission has arrived in Leninsk-Kuznetskii, Kemerovo Oblast, to investigate allegations that Mayor Gennadii Konyakhin is a convicted criminal and is allowing criminal associates to run the city, ITAR-TASS reported on 24 September. During meetings with Interior Minister Anatolii Kulikov and Federal Security Service (FSB) director Nikolai Kovalev on 22 September, Yeltsin ordered the Interior Ministry, the Procurator-General's Office, and the FSB to form a joint commission to investigate charges published in "Izvestiya" on 17-19 September. The president said the commission should try to prevent the "further criminalization of power" in Leninsk-Kuznetskii and also investigate whether similar events have taken place in other cities, Interfax reported. He criticized law-enforcement bodies for not informing the authorities early enough about the situation in Leninsk-Kuznetskii. TRANSCAUCASUS AND CENTRAL ASIA MINSK GROUP CO-CHAIRMEN IN BAKU. Meeting with the three co- chairmen of the Organization for Security and Cooperation in Europe's Minsk Group in Baku on 23 September, Azerbaijani President Heidar Aliev said Azerbaijan accepts the plan proposed by the co-chairmen on 18 July as a basis for resolving the Karabakh conflict, Turan and Interfax reported. He argued that the two-month delay since then does not "promote our common purpose." He also expressed the hope that "important steps" toward resolving the Karabakh conflict will be taken before the end of this year. Turan quoted Russian co-chairman Yurii Yukalov and Azerbaijani Foreign Minister Hasan Hasanov as saying Armenia has accepted a "phased resolution" of the conflict whereby a decision on the future status of the unrecognized Nagorno-Karabakh Republic will be postponed. The republic's leadership has rejected the peace plan and wants all aspects resolved simultaneously. AZERBAIJAN'S DEPUTY PARLIAMENTARY CHAIRMAN IN TEHRAN. Yashar Aliev met with Iranian President Mohammed Khatami in Tehran on 21 September, IRNA reported. The deputy speaker handed over a letter from Azerbaijani President Heidar Aliev to Khatami, who described Azerbaijan as a "friendly, brotherly country". Khatami called for a negotiated settlement to the Karabakh conflict in the interests of regional stability and security. Yashar Aliev commented that bilateral relations are "gaining momentum." Those ties have been strained for more than a year following the arrest and sentencing for espionage of several members of the pro-Iranian Islamic Party of Azerbaijan. AZERBAIJAN, TURKMENISTAN TO DISCUSS CASPIAN DISPUTE. Hasan Hasanov told journalists on 23 September that legal and oil experts from Azerbaijan and Turkmenistan will meet in October to discuss dividing the Caspian into national sectors, ITAR-TASS reported. Hasanov told LUKoil President Vagif Alekperov in Baku two weeks earlier that Turkmenistan has agreed to an Azerbaijani proposal to divide the Kyapaz/Serdar oil field, according to "Nezavisimaya gazeta." Both countries claim ownership of that field. AZERBAIJANI EARLY OIL COUNTDOWN. Visiting Baku on 23 September, Transneft Vice President Oleg Gordeev assured the leadership of Azerbaijan's state oil company SOCAR that work began that day on repairs to the Baku-Grozny-Novorossiisk pipeline through which Azerbaijan's "early" Caspian oil is to be exported, Russian and Azerbaijani agencies reported. Gordeev said the repairs will be completed within 22 days and that the first tanker-load of oil could leave Novorossiisk in December, according to "Nezavisimaya gazeta" on 24 September. Meanwhile, Russian First Deputy Premier Boris Nemtsov, who is also fuel and energy minister told Reuters that the alternative Baku-Novorossiisk pipeline bypassing Chechnya can be completed in nine months and that Russia will issue Eurobonds to meet the cost. "Trud" on 23 September reported, however, that Novorossiisk Mayor Valerii Prokhorenko categorically opposes construction of the alternative pipeline on ecological grounds. ARMENIAN PARLIAMENT ELECTS CHAIRMAN OF KEY COMMITTEE. The National Assembly on 23 September elected Vigen Khachatryan as chairman of its State and Legal Affairs Committee, RFE/RL's Yerevan bureau reported. Khachatryan is the leader of the small Liberal Democratic Party, one of the five members of the ruling Hanrapetutyun bloc. The committee's previous chairman, Eduard Yegoryan, was removed on 10 September after quitting the Hanrapetutyun bloc to form an opposition parliamentary faction. Khachatryan, who is also governor of Armenia's northern Lori province, vowed to continue Yegoryan's efforts to "form a basic legal framework in Armenia." The Armenian Pan-National Movement had originally claimed the right to nominate the committee's new chairman but reversed that decision on 20 August at the request of President Levon Ter-Petrossyan and parliamentary speaker Babken Ararktsyan (see "RFE/RL Newsline," 22 September 1997). BELARUSIAN PRESIDENT IN KAZAKHSTAN. Alyaksandr Lukashenka, who is on a three-day official visit to Kazakhstan, met with his Kazakh counterpart, Nursultan Nazarbayev, on 23 September to discuss boosting bilateral trade. Compared with the same period last year, Belarusian-Kazakh trade was down 40 percent in the first half of 1997. Lukashenka said, however, that by year's end, trade figures would at least equal those for 1996. Agreements were signed on trade, air links, and protection for the rights of one country's citizens working in the other country. Belarus will also open an embassy in Kazakhstan. Lukashenka said he favored Nazarbayev to take over as head of the four-country customs union, which also includes Russia and Kyrgyzstan. The Belarusian president currently occupies that position. NAZARBAYEV SUPPORTS BELARUS ON ORT JOURNALIST. Nazarbayev gave his full support to Belarus's position in its dispute with Russia over Russian Public Television (ORT) reporter Pavel Sheremet, an RFE/RL correspondent in Almaty reported. Sheremet has been under arrest in Minsk since mid-July on charges of having violated the Belarusian-Lithuanian border. Interfax quotes Nazarbayev as saying each country has the "right to insist that its citizens implement the country's laws." He called on the media "to contribute to the rapprochement between peoples rather than sow discord between them or ignite tension between countries." Nazarbayev also criticized the fact that while Russian television channels are available in other CIS countries, no television programming from those countries is available in Russia. "The Russian people therefore only know one position," he added. JAPAN TO HELP BUILD TURKMEN RAIL LINE. Japan's Itochu Corporation has agreed to help form a consortium to build a rail line running from the Kazakh city of Yeralievo to the Turkmen city of Turkmenbashi, on the eastern shore of the Caspian Sea, ITAR-TASS reported on 23 September. Japanese experts are reviewing a feasibility study carried out by Russia's Mosgiprotrans. The 450- kilometer rail line may eventually be linked to Russian lines in the Urals and Siberia and to the Turkmen-Iran line. xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx Copyright (c) 1997 RFE/RL, Inc. 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