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RFE/RL NEWSLINE Vol 1, No. 166, Part I, 24 November1997
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 EUROPE: Has The West Embraced The East? -- a five-part series about Europe's multilateral organizations and whether and how they've aided the integration of Central and Eastern Europe with the West -- is online at the RFE/RL Web site. http://www.rferl.org/nca/special/multilateral/index.html xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx Headlines, Part I * CHERNOMYRDIN SAYS CABINET RESHUFFLE OVER * AUTHOR OF TAX REFORM PLAN QUITS * AZERBAIJAN REJECTS PASSPORTS PRINTED IN FRANCE xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx *RUSSIA CHERNOMYRDIN SAYS CABINET RESHUFFLE OVER... Prime Minister Viktor Chernomyrdin on 22 November said there will be no more cabinet reshuffles, Interfax reported. Two days earlier, First Deputy Prime Ministers Boris Nemtsov and Anatolii Chubais had been forced to give up their posts of minister of fuel and energy and of finance, respectively. Chernomyrdin stressed there was "no question" that Labor Minister Oleg Sysuev, Interior Minister Anatolii Kulikov, Agriculture Minister Viktor Khlystun, and Economy Minister Yakov Urinson--all of whom are deputy prime ministers--will similarly be forced to give up their portfolios. The reshuffle involving Chubais and Nemtsov came after President Boris Yeltsin had reportedly approved a plan to bar deputy premiers from holding ministerial posts. That move was seen by some observers as a way of saving face amid opposition pressure to remove Chubais from office altogether. Chubais is involved in a scandal over payments for an unpublished book on privatization. AW ...ANNOUNCES ZADORNOV WILL REPORT TO HIM. At a 21 November meeting with senior Finance Ministry officials, Chernomyrdin said new Finance Minister Mikhail Zadornov will report directly to him, Reuters reported. Chernomyrdin reassured Chubais he will not be cut off from the work of the ministry, although he stressed Zadornov will not report to him. "I think this is also no secret, the minister of finance works directly with the prime minister," he said. Chernomyrdin insisted the decision to remove Chubais as finance minister was taken to ease his work load and not in connection with the book scandal. Noting Zadornov will be under a lot of pressure, Chubais, who also attended the meeting, said he will continue to work with him. "The situation on the financial markets is complicated and of course, responsibility rests on the shoulders of the finance minister," he added. AW CHERNOMYRDIN, NEMTSOV DIFFER OVER MEANING OF GOVERNMENT CHANGES. Chernomyrdin on 21 November said his government has emerged more stable than ever as a result of the recent cabinet reshuffle, Interfax reported. "Russia has entered a new stage of political maturity," Chernomyrdin said. "The state is getting stronger and its role is growing in every sphere, especially in the economy." But while introducing Sergei Kirienko as his successor at the Fuel and Energy Ministry, Nemtsov said the same day that the shake-up is the result of a much deeper, "ideological" crisis. "This is about a choice of ways--either free privatization benefiting a narrow circle of people or privatization for great sums of money benefiting all who honestly participate in auctions run under state rules." Nemtsov had been discussing the planned privatization of the state oil company Rosneft before making that remark. AW RUSSIAN PRESS DECLARES CHERNOMYRDIN VICTOR IN RESHUFFLE. Russian newspapers on 21 November generally agreed that Chernomyrdin has emerged as the winner in the cabinet shake-up. "Chernomyrdin, who has long been in the shadow of his first deputies, has sharply changed the balance of forces in his favor," the business newspaper "Kommersant-Daily" said. The newspaper noted that Mikhail Zadornov, who has replaced Chubais as finance minister, "is on very good terms with Chernomyrdin." The daily "Russkii Telegraf," which is owned by Chubais ally Vladimir Potanin, admitted on 22 November that Chernomyrdin has come out on top. The prime minister is now striving to "capitalize on his victory" and to draw "concrete benefits" from it. In a sign of his diminishing role, Chubais was passed over in favor of Nemtsov as acting prime minister during Chernomyrdin's visit to Vietnam, which began on 23 November. AW CHUBAIS TO SUE JOURNALISTS FOR LIBEL. Chubais is planning to sue for libel two Russian journalists who accused him of corruption, Chubais spokesman Andrei Trapesnikov said on 21 November, according to Interfax. Legal action will be taken against "Novaya Gazeta" correspondent Aleksandr Minkin and Russian Public Television journalist Sergei Dorenko, who claimed that the payments Chubais received for the unpublished privatization book were bribes. AW AUTHOR OF TAX REFORM PLAN QUITS. The official who drafted the long-stalled new tax code has confirmed that he is quitting his post as deputy finance minister, Interfax reported on 24 November. Sergei Shatalov has devoted most of the last five years to drafting the tax code, which will replace the ineffective tax law. It is unclear whether Shatalov's departure is linked to the recent scandal involving Chubais. AW CHERNOMYRDIN URGES LARGER REVENUES, PASSAGE OF BUDGET... At the 21 November meeting with senior Finance Ministry officials, Chernomyrdin called for a renewed push to boost government revenues and secure passage of the 1998 budget, Interfax and ITAR- TASS reported. Chernomyrdin said the improved collection of tax revenues is the ministry's most important task. "There's no justification for a finance minister if this does not happen," he said. Chernomyrdin accused opposition lawmakers of "artificially drawing out" the process to adopt next year's budget. He warned that further delays in passing the 1998 draft budget would cost the Russian economy as much as 50 trillion rubles ($8.4 billion) in the first months of 1998, although he did not explain how he made that calculation. The budget was to be debated 21 November, but the State Duma voted to put the budget draft on its agenda on 5 December. The lower house had been delaying discussion on the draft in the hope of putting pressure on Yeltsin to oust Chubais. AW ...SAYS GOVERNMENT PREPARING STOP-GAP SPENDING MEASURE. As the prospects of passing the budget by the end of the year grow dimmer, Chernomyrdin said on 21 November that the government is preparing a stop-gap spending measure for 1998, Interfax reported. Chernomyrdin ordered the government to draft the plan roughly in accordance with spending for this year, meaning that federal expenditures in 1998 would be much lower than projected levels in the draft budget. "Kommersant-Daily" said the same day that Chernomyrdin was not greatly upset about the Duma's decision to postpone debate on the budget until 5 December (see below). AW SELEZNEV CALLS FOR COALITION GOVERNMENT. Duma speaker Gennadii Seleznev has called for the creation of a coalition government that would take into consideration the communists' dominance in the lower house of the parliament, Interfax reported on 23 November. Communist Party member Seleznev called for a constitutional amendment allowing the government to be formed on the basis of either the majority party in the Duma or a coalition formed by the deputies. "It is time to speak frankly to the president about the creation of a government based on popular confidence," Seleznev said. AW ZYUGANOV LASHES OUTS AT GOVERNMENT. Communist Party leader Gennadii Zyuganov has criticized government policies as bankrupt, Interfax reported 22 November. "Within the next two months, the bankruptcy of their policy will become so evident to everyone that they will have to admit the choice to start seriously changing their course or go," Zyuganov said. Chernomyrdin later dismissed Zyuganov's remarks, saying the government "is not listening to threats." With regard to the Duma's decision to delay debate on the budget until 5 December, he accused the legislators of "saying one thing before lunch and something different after lunch." AW DUBININ SAYS FOREIGN INVESTMENT FLOWS OUT OF RUSSIA. Central Bank President Sergei Dubinin told the Duma on 21 November that foreign investment totaling $5 billion has been pulled out of Russia's bond market as a result of recent worldwide market instability, Reuters reported. Dubinin was upbeat, however, saying if world markets stabilize in the coming weeks, the pressure on Russia also will ease. In his remarks about currency instability, Dubinin expressed optimism, saying the Central Bank and the government will be able to stabilize the situation to prevent sharp fluctuations in the value of the ruble. Speaking to reporters later, Dubinin said the Central Bank's gross foreign-currency and gold reserves totaled $21.5 billion as of 21 November. AW GAZPROM HEAD CALLS FOR REDUCING STATE SHARE. The chairman of Gazprom has called for reducing the state's share in the natural gas giant from just over 40 percent to just over 25 percent, Interfax reported on 21 November. Rem Vyakhirev said the move will ensure government control over Gazprom but allow greater managerial flexibility. He also said it will reduce the number of seats the government has on Gazprom's board. According to Interfax, Vyakhirev claimed that frequent changes in the government mean state representatives on the board did not last long enough to be effective. AW RUSSIA MAKES BID TO JOIN APEC. At their 22 November meeting in Vancouver, the foreign and trade ministers from the Asia-Pacific Economic Cooperation Organization (APEC) postponed the question of admitting Russia , Vietnam, and Peru until the conference officially opens, ITAR-TASS reported. Russian media reports on 21 November that Russia had been admitted to the organization were denied the next day. A number of participants reportedly remain undecided about Russian membership, while agreement in principle has been reached on Vietnam's and Peru's entry. The official conference takes place from 24-25 November. BP RUSSIAN, CHINESE REGIONS SIGN PIPELINE DEAL. The governor of Russia's Chita region and the deputy chairman of China's Inner Mongolia Autonomous Region signed an accord on 22 November to build a 12-kilometer pipeline that will transport petroleum products to China, ITAR-TASS reported. The news agency stated that the pipeline will run from Zabaikalsk to the Chinese city of Manchuria and will have a throughput capacity of 2,000 tons a day. BP YELTSIN NAMES SERGEEV "MARSHAL." Russian President Boris Yeltsin on 21 November gave Defense Minister Igor Sergeev the rank of "marshal of the Russian Federation," Reuters reported. Sergeev is the first member of the armed forces to receive that title since 1991. BP CHECHEN PRESIDENT RETURNS FROM U.S. VIA BAKU. Aslan Maskhadov and Azerbaijani President Heidar Aliev met behind closed doors in Baku on 23 November, Russian media reported. Maskhadov was on his way home from the U.S. via Turkey. On arrival in Grozny later that day, Maskhadov told journalists he succeeded in convincing U.S. officials (whom he did not name) that Russia gives a distorted picture of the situation in Chechnya and that political dialogue with the Chechen leadership is both possible and necessary. He warned, however, that Grozny will not agree to concessions over its status and that Chechnya "is and will be independent," AFP reported. LF TRANSCAUCASUS AND CENTRAL ASIA AZERBAIJAN REJECTS PASSPORTS PRINTED IN FRANCE. The Azerbaijani government has refused to accept delivery of 4 million passports printed in France, arguing that the quality is unacceptable and pointing out that the Azerbaijani-language sections contain orthographic errors, AFP reported on 22 November. French Ambassador to Baku Jean-Pierre Guinhut told Turan that the Azerbaijani leadership had insisted on the lowest possible price. He commented that it is impossible to produce a world-standard passport for only $1. Azerbaijani citizens are still using Soviet-era passports, whose the validity has been extended by the parliament. LF AZERBAIJANI FOREIGN MINISTER IN LEBANON. Hasan Hasanov met with his Lebanese counterpart, Fares Bweiz, Prime Minister Rafic Al- Hariri and President Elias al-Hrawi in Beirut on 19-20 November. The Central Committee of the Armenian Revolutionary Federation (Dashnaktsutyun) in Lebanon issued a statement criticizing remarks Hasanov made to Lebanese media, Asbarez-on-Line reported on 21 November. Hasanov was said to have argued that the Karabakh conflict is an international one between Armenia and Azerbaijan. He was also reported to have exaggerated the number of Azerbaijanis forced to flee their homes during the fighting. Hasanov's visit was the second stop in a Middle Eastern tour aimed at rapprochement with Syria and Lebanon. Armenia enjoys cordial relations with both those countries. LF ARMENIAN OPPOSITION LEADERS TO STEP DOWN. Ruben Hakobian, the leader of the Armenian Revolutionary Federation (Dashnaktsutyun) in Armenia, and Gagik Mkrtchian, the editor of the Dashnak party paper "Hayots Ashkhar," have asked to be relieved of those posts, Noyan Tapan reported on 21 November. A senior Dashnak party member told RFE/RL's Yerevan bureau on 22 November that Hakobian's decision was prompted by purely personal reasons. The Armenian press, however, speculates that his resignation reflects serious differences within the party over how to resolve the Karabakh conflict. LF WORLD BANK AID FOR ARMENIA NOT LINKED TO POLITICS. Vahram Nersisiantz, the World Bank's representative in Armenia, told an RFE/RL correspondent in Yerevan on 21 November that the bank would not reconsider its loan programs for Armenia if the government refused to recognize Azerbaijan's sovereignty over Nagorno-Karabakh. Nersisiantz said the World Bank's future aid to Armenia will be contingent only on "economic and not political criteria." He praised the Armenian government for its policies of economic reform, arguing that they have largely been a success, despite "some minor drawbacks." In recent years, the World Bank has granted Yerevan more than $200 million in credits and low- interest loans. Most of the aid has been used for reconstructing the country's infrastructure and covering its budget deficit. LF DOES ARMENIA HAVE A DRUG PROBLEM? Ashot Mkrtchyan, the government official in charge of monitoring drug-related crimes, has warned that Armenia is a center and transit point for international drugs smuggling, Asbarez-on-Line reported on 21 November, citing Noyan Tapan. Mkrtchyan said 500 people are currently serving prison sentences for drug-related crimes and that the volume of drugs confiscated has increased by 30 times during the past four years. But an Italian police official who recently visited Yerevan and met with Prosecutor-General Genrik Khachatryan concluded that, unlike other countries in the region (which he did not name), the situation in Armenia gives no grounds for alarm, according to "Nezavisimaya gazeta" on 22 November. LF GEORGIAN FOREIGN MINISTER ASSESSES ABKHAZ TALKS. Irakli Menagharishvili told journalists in Tbilisi on 21 November that since the recent talks in Geneva on the Abkhaz conflict created the foundation for ongoing negotiations, those discussions should not be termed a failure, Russian media reported. Menagharishvili disclosed that the Abkhaz delegation rejected the Georgian proposal to strike from the agenda the question of Abkhazia's future political status. He denied that the Georgian leadership's disapproval of the Russian decision to import agricultural produce from Abkhazia would prompt Georgian foreign policymakers to give greater priority to relations with the U.S. Menagharishvili also denied that Russia's role in mediating the Abkhaz conflict is being eclipsed by the growing involvement of the UN Secretary-General's "Friends of Georgia" group. LF TAJIK PRESIDENT DISCUSSES HOSTAGE-TAKING WITH FRENCH AMBASSADOR. Tajik President Imomali Rakhmonov met with the French ambassador to Tajikistan on 21 November to discuss the two French nationals still being held by unknown abductors, Interfax reported. Tajik authorities confirmed that there have been two phone calls demanding the release of Bahrom Sadirov in exchange for the hostages. On 24 November, 11 suspects were taken into custody in connection with the kidnapping, and Deputy Prime Minister Abdurahmon Azimov said the area where Rezvon Sadirov and his gang are located, some 30 kilometers east of Dushanbe, has been surrounded, ITAR-TASS reported. BP THIEVES CAUGHT OUTSIDE BAIKONUR SPACE CENTER. Troops from Kazakhstan's National Security Committee and Interior Ministry apprehended a band of thieves as they were stealing sections of electric power lines near the Baikonur cosmodrome, ITAR-TASS reported on 23 November. The thieves used tractors to fell 46 pylons and were loading some 2 tons of the aluminum wire onto trucks when they were caught. All are unemployed and pleaded poverty. Local officials say they do not have the money to repair the damage. BP TURKMENISTAN TO AUCTION OFF STATE ENTERPRISES. President Saparmurat Niyazov announced on 21 November that his country will hold auctions from January to March 1998 for 50 state-owned enterprises, ITAR-TASS reported. Half of those companies are in the textile sector, while others in the energy, industry, construction, and food and fruit industries will be among those going on the block. By the year 2000, Turkmenistan hopes to auction off a total of 350 such enterprises. BP xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx Copyright (c) 1997 RFE/RL, Inc. 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