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RFE/RL NEWSLINE Vol. 2, No. 12, Part I, 20 January 1998
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 xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx Headlines, Part I * YELTSIN APPROVES GOVERNMENT PLANS * MERGER TO CREATE LARGEST RUSSIAN OIL COMPANY * KARABAKH PRESIDENT AGAIN REJECTS OSCE PEACE PLAN xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx RUSSIA YELTSIN APPROVES GOVERNMENT PLANS... President Boris Yeltsin on 19 January announced that the government has submitted proposals to him on 12 key tasks in social and economic policy for 1998, RFE/RL's Moscow bureau reported. He said the document is "unusual" in that it assigns responsibility for implementing each task to one government minister and one member of the presidential administration. The document has not been released, but government officials have previously said improving tax collection, reducing the tax burden, maintaining strict control over state spending, and tackling the non-payments problem will be top priorities this year. Earlier the same day, Yeltsin told Prime Minister Viktor Chernomyrdin and First Deputy Prime Ministers Anatolii Chubais and Boris Nemtsov that the government failed to meet its obligations for 1997, especially in terms of paying wage arrears to state employees (see "RFE/RL Newsline," 19 January 1998). LB ...IS AMBIVALENT OVER KULIKOV'S CHECHEN STATEMENT. Also on 19 January, Yeltsin rebuked Interior Minister Anatolii Kulikov for his controversial 6 January statement advocating preemptive strikes against Chechen guerrilla bases. "Such statements should not have been made without prior consultation with me," Interfax quoted him as saying. But Yeltsin made clear that he "is very close" to Kulikov's hard-line position on Chechnya. Commenting on Kulikov's statement, Russian government spokesman Igor Shabdurasulov had said it represented the minister's "personal opinion." Also on 19 January, Yevgenii Savostyanov, the deputy head of the presidential administration, predicted that an agreement between Moscow and Grozny on the precise nature of bilateral relations will require "many, many years" of negotiations. He added that "good-neighborly relations" cannot be achieved by "an oil pipeline or transfers" of funds from the federal budget. LF NEMTSOV ON POSSIBLE CABINET CHANGES. First Deputy Prime Minister Nemtsov told "Izvestiya" of 20 January that he believes Yeltsin and Chernomyrdin understand it would be a "waste of time" to "reshuffle everything and start over with a new government." He noted that 1998 is "the last [year] in which it is possible to work normally" before the campaigns for the next parliamentary and presidential elections, scheduled for 1999 and 2000. Nemtsov again said Yeltsin promised him two years in the government when he appointed him first deputy prime minister last March. As for the future of First Deputy Prime Minister Chubais, Nemtsov said his opinion whether Chubais will resign "changes strongly from day to day." The government responsibilities of Chubais and Nemtsov were recently downgraded (see "RFE/RL Newsline," 16 and 19 January 1998). LB MERGER TO CREATE LARGEST RUSSIAN OIL COMPANY. Executives of the oil companies Yukos and Sibneft on 19 January announced plans to merge. The new company, Yuksi, will overtake LUKoil as the largest Russian oil company and will be the third-largest private oil producer in the world, according to the 19 January "Financial Times." Yuksi will also include the Eastern Oil Company, in which Yukos has a controlling stake, and the East-Siberian Oil and Gas Company, which is affiliated with Sibneft. Mikhail Khodorkovskii, the founder of the Menatep bank and currently the top executive at Yukos, will be the new company's president. "Kommersant- Daily" reported on 20 January that 60 percent of the shares in Yuksi will belong to the current shareholders of Yukos and 40 percent to Sibneft shareholders. Khodorkovskii confirmed that Yuksi will bid for a stake in the oil company Rosneft. LB CHERNOMYRDIN PRAISES MERGER. Speaking at the signing ceremony for the creation of Yuksi, Prime Minister Chernomyrdin welcomed the merger of Yukos and Sibneft. He added that "Russian companies should compete [abroad], but within Russia they should agree between themselves," Kommersant-Daily" reported on 20 January. Chernomyrdin also said he will meet with the leaders of oil companies soon to discuss tax issues, ITAR-TASS reported. Commenting on the government's attitude toward the creation of Yuksi, Boris Berezovskii, a major investor in Sibneft, said that "at last Russia has rejected the idea of demonopolization, which does not correspond to the spirit of the times." LB MINISTRY SAYS ECONOMY GREW IN 1997. Preliminary data compiled by the Economics Ministry indicate that 1997 marked the first year in the post-Soviet period that Russia experienced economic growth, ITAR-TASS reported on 19 January. The data show that GDP rose 0.4 percent in 1997 and industrial production 1.9 percent. Preliminary data compiled by the State Statistics Committee show similar gains of 0.4 percent in GDP and 1.8 percent in industrial production. The government initially predicted GDP growth of 2 percent for 1997. Yeltsin has demanded that the government provide for 2-4 percent economic growth this year. LB CREDIT-RATING OUTLOOK DOWNGRADED. Despite upbeat statements by government officials, international rating agencies are pessimistic about Russia's economic prospects. On 15 January, Moody's downgraded Russia's credit-rating outlook from "stable" to "negative," meaning that it will be more expensive for the Russian government and Russian corporations to borrow money abroad. Standard and Poor's, the other major international credit rating agency, revised its rating outlook for Russia from stable to negative in December. LB FOREIGN MINISTRY DISPLEASED BY BULGARIAN STATEMENTS ON GAS TRANSIT. The Russian Foreign Ministry on 19 January said recent warnings that Bulgaria may reduce Russia's gas transit across its territory are tantamount to "political pressure," which, the ministry added, could complicate Russia's relations with other countries and harm the economic security of southeastern Europe, Russian news agencies reported. Bulgarian Prime Minister Ivan Kostov recently said transits of gas to Turkey, Serbia, Greece, and Macedonia through Bulgaria may be reduced if the Russian gas monopoly Gazprom curtails deliveries for Bulgarian consumption (see "RFE/RL Newsline," 15 and 19 January 1998). But the Russian Foreign Ministry said such a move would violate intergovernmental agreements signed by Bulgaria in 1994 and 1997. Gazprom head Rem Vyakhirev has said his company will explore alternative ways of delivering gas to third countries if Bulgaria follows through on the threat, "Kommersant-Daily" reported on 20 January. LB PRESIDENTIAL ADMINISTRATION TO BE DOWNSIZED. The presidential administration is to be downsized by 200 employees, or about 10 percent, deputy head of the administration Yevgenii Savostyanov told Interfax on 19 January. "Kommersant-Daily" reported on 17 January that Presidential Chief of Staff Valentin Yumashev is the initiator of the changes. Viktoriya Mitina, who was appointed deputy head of the presidential administration last November, has also called for eliminating departments in the administration that duplicate one another's work. LB STROEV CRITICIZES COALITION GOVERNMENT PROPOSALS... Federation Council Speaker Yegor Stroev on 19 January criticized draft proposals on forming a coalition government, saying they lack a "concept," Russian news agencies reported. State Duma Speaker Gennadii Seleznev has said he will submit the proposals to Yeltsin at a meeting in late January. He told Interfax that Stroev has not seen the final draft of the document. Both presidential spokesman Sergei Yastrzhembskii and Yeltsin's representative in the Constitutional Court, Sergei Shakhrai, said recently that the president will reject plans on forming a coalition government. Earlier, Stroev said the president should be aware of parliament's opinions when forming the cabinet, but he has shied away from advocating a coalition government (see "RFE/RL Newsline," 10 December 1997). LB ...AND POWER-SHARING TREATIES WITH REGIONS. Also on 19 January, Stroev again criticized the practice of bilateral agreements being concluded by the federal government and regional authorities, "Kommersant-Daily" reported on 20 January. Addressing a conference on Russian federalism hosted by the Federation Council, Stroev said such power-sharing agreements contribute to the arbitrary nature of relations between Moscow and regional governments and leave relatively weak regions almost completely dependent on the Kremlin. Stroev added that the strongest regions, such as the Republic of Tatarstan, have virtually "confederative" relations with Moscow. More than 30 regions have signed power-sharing agreements. Stroev also criticized attempts to blame regional leaders for failing to pay all wage arrears to state employees. He asked rhetorically, "if the government has not paid for state orders, and the regional government is consequently unable to collect all taxes, is the governor to blame?" LB OFFICIALS CRITICIZE REGIONAL LAWS. Addressing the same conference on federalism, Prosecutor-General Yurii Skuratov announced that nearly 2,000 regional laws have been revoked for contradicting the Russian Constitution, Interfax reported on 19 January. But Skuratov called for better compliance with federal legal norms, noting that Russia currently lacks sufficient "levers" for ensuring that Constitutional Court rulings on regional laws are implemented. Justice Minister Sergei Stepashin told the conference that about one-third of the 16,000 regional laws examined by the Justice Ministry since summer 1995 have been found to violate federal legislation, ITAR-TASS reported. By way of example, he said some two-thirds of Russian regions have passed laws on alcohol production and distribution that violate federal law. LB COURT RULES LOCAL GOVERNMENTS MUST BE ELECTED... The Constitutional Court on 15 January struck down passages in the Komi Republic's constitution and law on executive authorities that allow the republican administration to appoint local governments, "Nezavisimaya gazeta" reported on 16 January. The ruling means that elections must be held in all municipalities to choose local authorities. In the past, Yurii Spiridonov, the head of the Komi Republic, has appointed some local leaders. In addition, the court rejected a passage in the Komi Constitution that says local executive authorities must answer to local legislative authorities. Article 131 of the Russian Constitution says that the people alone may determine the structure of local government. LB ...AND RESIDENCE PERMIT NOT REQUIRED FOR FOREIGN PASSPORT. Also on 15 January, the Constitutional Court ruled that authorities may not require Russian citizens to produce residency permits in order to be issued passports valid for foreign travel, "Kommersant-Daily" reported on 16 January. The judges struck down a passage in the law on procedures for leaving and entering the Russian Federation, saying it violated the constitutional right to freedom of movement. Aleksandr Avalov, who has lived in Moscow for several years but is officially registered as a resident of Tbilisi, lodged the court appeal. The court ruling means that homeless people, forced migrants, and others who lack a permit ("propiska") for their city of residence may receive passports valid for foreign travel. The Constitutional Court has previously ruled on several occasions that the "propiska" system is itself unconstitutional. LB SUSPECT IN YEKATERINBURG BOMB ATTACK DETAINED. Lieutenant-General Valerii Kraev, the head of the Sverdlovsk Oblast police department, told Interfax on 19 January that authorities believe a man detained on charges of illegal weapons possession may have been involved in the 14 January bomb explosion in Yekaterinburg. The bomb went off as a car carrying Sverdlovsk Governor Eduard Rossel passed by. Kraev said investigators suspect that organized crime groups are behind the attack. RFE/RL's correspondent in Yekaterinburg reported on 15 January that local observers believe the relatively small bomb was not intended to kill Rossel. Nikolai Ovchinnikov, head of the Yekaterinburg police, told journalists on 14 January that he does not believe the blast was linked to the recent arrests in Yekaterinburg of some 50 criminals from throughout Russia and the CIS. Ovchinnikov cited the "unprofessional" and "poorly prepared" nature of the bombing. LB NORTH OSSETIAN PRESIDENT-ELECT RECEIVES CONGRATULATIONS. Aleksandr Dzasokhov affirmed on 19 January that he will seek to resolve the republic's serious economic problems and work with Moscow to expedite a solution to the Ossetian-Ingush and Ossetian-Georgian conflicts, ITAR-TASS reported. The presidents of neighboring Ingushetia and Georgia, Ruslan Aushev and Eduard Shevardnadze, both greeted Dzasokhov's election victory. Aushev noted that Dzasokhov, unlike outgoing president Akhsarbek Galazov "bears no responsibility" for the clashes in November 1992 in North Ossetia's disputed Prigorodnyi Raion, in which hundreds of ethnic Ingush were killed. In Moscow, Deputy Prime Minister Ramazan Abdulatipov predicted that Dzasokhov's election "will have a positive effect" on regional policy in the North Caucasus. LF TRANSCAUCASUS AND CENTRAL ASIA KARABAKH PRESIDENT AGAIN REJECTS OSCE PEACE PLAN. On 19 January, Arkadii Ghukasyan again rejected the most recent peace proposals by the Organization for Security and Cooperation in Europe's Minsk Group, RFE/RL's Stepanakert correspondent responded. Ghukasyan said those proposals would only serve to "freeze" the Karabakh conflict and restore the status quo that existed prior to February 1988. He added that "simple common sense" prevented the Karabakh population from agreeing to "unilateral concessions." Ghukasyan also criticized those responsible for spreading rumors about the possible resignation of Armenian Prime Minister Robert Kocharyan, saying they "are playing a dangerous game." Ghukasyan said that Kocharyan, his predecessor as president of the unrecognized Nagorno- Karabakh Republic, is "a man who has done a great deal for the consolidation of the Armenian people." LF SHOTS FIRED AT ARMENIAN PRESIDENTIAL SECURITY CHIEF. Major-General Romik Ghazarian, the head of the presidential security service, escaped unhurt on the night of 18 January when gunmen opened fire on his jeep. Kazarian was returning from Armavir to Yerevan. An investigation has been opened into the incident. LF KAZAKH WORKERS DEMAND LAST TWO YEARS' WAGES. The number of striking workers from the Janatas Phosphorus plant has grown to 3,000 since their protest began in mid- December, RFE/RL correspondents in Kazakhstan reported on 20 January. The workers are demanding the payment of back wages for 1996 and 1997 totaling some $5 million. Some 50 workers set out for Akmola to meet with the president, but militia barred them from entering the capital. The strike has the support of the Federation of Kazakh Trade Unions. According to ITAR-TASS on 19 January, the prosecutor-general has opened a case against the federation for using "financial support from abroad" and exploiting the protests to destabilize the country. BP KYRGYZSTAN STILL SUFFERS POWER SHORTAGES. The upper house of the parliament on 19 January reviewed the country's energy situation, RFE/RL correspondents in Bishkek reported. First Deputy Prime Minister Kamelbek Nanayev said there are still shortages in gas supplies from Uzbekistan. Kyrgyzstan and Uzbekistan reached agreement on the level of supplies earlier this month (see "RFE/RL Newsline," 6 January 1998). The same day, Bakirdin Sartkaziev, the president of Kyrgyzenergoholding, told a press conference that low levels in the Tokhtogul reservoir are contributing to the "critical" energy situation. The reservoir usually contains 11 million cubic meters of water at this time of year but currently has only 9.5 million cubic meters. Sartkaziev also said Kazakhstan has not fulfilled its part of an agreement on coal deliveries to Kyrgyzstan. So far, nothing has been received, Sartkaziev noted. BP PREPARATIONS UNDER WAY FOR NEXT "CENTRAZBAT." The next military exercises in Central Asia under the NATO Partnership for Peace program will be held in Kyrgyzstan and Uzbekistan, Interfax reported on 19 January. According to Uzbek Deputy Defense Minister Kakhramon Abdullayev, one part of the exercises will be held Kyrgyzstan's Osh region, while Uzbekistan has not decided yet whether the other part will be conducted in the Fergana or Tashkent region. Abdullayev said troops from Kazakhstan and other countries in the NATO program will also take part. Last year, Kyrgyzstan, Kazakhstan, and Uzbekistan, along with other countries, held the "Centrazbat" exercises on Kazakh and Uzbek territory. It is has not yet been revealed when this year's exercises will take place. BP xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx Copyright (c) 1998 RFE/RL, Inc. 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