Logic, n. The act of thinking and reasoning in strict accordance with the limitations and incapacities of the human understanding. - Ambrose Bierce
RFE/RL NEWSLINE

RFE/RL NEWSLINE Vol 2, No.19 , Part I, 29 January 1998

RFE/RL NEWSLINE Vol 2, No.19 , Part I, 29 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


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MonacoNow available on the RFE/RL Web site,
RUSSIA'S FINANCIAL EMPIRES. This special report profiles the "big
seven" Russian commercial banks and gives background information on
Russia's banking system. The report is located at:

http://www.rferl.org/nca/special/rufinance/index.html


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Headlines, Part I


* RUSSIA,  FRANCE ADVISE NOT TO USE FORCE AGAINST IRAQ


* 'PALACE COUP' AVERTED AT ELECTRICITY GIANT


* ARMENIAN OPPOSITION LEADER CALLS ON PRESIDENT TO RESIGN


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RUSSIA


RUSSIA, FRANCE ADVISE NOT TO USE FORCE AGAINST IRAQ.  Speaking in Paris
on 28 January, Russian Foreign Minister Yevgenii Primakov called on
Iraq to stop insisting on a moratorium on the work of the UN weapons
inspection commission. Both Primakov and his French counterpart, Hubert
Vedrine, strongly advised that force not be used against Iraq. The same
day,  Russian Deputy Foreign Minister Viktor Posuvalyuk met in Baghdad
with Iraqi President Saddam Hussein, to whom he handed over a personal
message from Russian President Yeltsin. Saddam assured Posuvalyuk that
he appreciates the efforts of the Russian leadership to ensure
implementation of the November agreement that allows for resuming the
work of the UN weapons inspection commission. In Moscow, Deputy Speaker
of the State Duma Mikhail Gutseriev and Duma Geopolitics Committee
Chairman Aleksei Mitrofanov, both of whom are members of the Liberal
Democratic Party of Russia, warned that the use of force against Iraq
by the U.S. or Britain would be "inadmissible" and a "terrible
mistake," according to ITAR-TASS. LF


'PALACE COUP' AVERTED AT ELECTRICITY GIANT... The board of directors of
the electricity giant Unified Energy System (EES) on 27 January
attempted to replace the company's chief executive Boris Brevnov with
the former EES head and current chairman of the board, Anatolii Dyakov,
RFE/RL's Moscow bureau reported on 28 January. However, various
government officials denounced the board's action as illegal, since
government representatives in the company were absent from the board
meeting. The state has a controlling stake in EES, which operates the
nationwide electricity grid and owns controlling stakes in most
regional utilities. EES press secretary Sergei Medvedev told RFE/RL
that the company considers the attempt to remove Brevnov a "palace
coup." Medvedev was Yeltsin's spokesman from March 1995 until August
1996. LB


...WHILE ATTEMPT SEEN LINKED TO GOVERNMENT DEVELOPMENTS. The attempt to
replace Brevnov with the EES old guard appears to be connected to the
recent redistribution of power within the government, RFE/RL's Moscow
bureau reported. Earlier this month, Prime Minister Viktor Chernomyrdin
took away from First Deputy Prime Minister Boris Nemtsov responsibility
for supervising energy policy (see "RFE/RL Newsline," 16 and 19 January
1998). Soon after he joined the government last spring, Nemtsov brought
in Brevnov, previously a Nizhnii Novgorod banker, to head EES. Nemtsov
told reporters in Nizhnii Novgorod on 28 January that both he and Fuel
and Energy Minister Sergei Kirienko, who is currently in Kemerovo
Oblast, will sort out the situation at EES when they return to Moscow,
RFE/RL's correspondent in Nizhnii Novgorod reported. LB


AUDIT CHAMBER TO PROBE COMPANY FINANCES. The Audit Chamber is to
conduct a thorough examination of EES finances in 1997, RFE/RL's Moscow
bureau reported on 28 January. The chamber has already carried out a
partial audit of the company. Board chairman Dyakov on 28 January
accused Brevnov of various financial improprieties, including drawing
loans without the board's permission and charging the company for
private travel, Russian news agencies reported. In an interview with
RFE/RL's Moscow bureau, Brevnov defended his performance as EES
director and denied the company had paid for any personal travel. He
accused former EES management of encouraging barter payments and other
financial practices that, he said, are now being investigated by the
tax police. LB


NEMTSOV URGES ENTREPRENEURS TO 'BUY RUSSIAN.' First Deputy Prime
Minister Nemtsov met with leading business figures in Nizhnii Novgorod
on 28 January and called on them to join the new association "Buy Only
Russian," RFE/RL's correspondent in Nizhnii Novgorod reported.
Addressing the founding meeting of that association in Moscow on 23
January, Nemtsov advocated a policy of "reasonable protectionism" that
would raise customs duties on some finished products, Interfax
reported. He also said the government's new version of the tax code
allows Russian companies to deduct advertising expenses as production
costs. The measure is aimed at helping domestic firms combat what
Nemtsov called "aggressive advertising" of foreign products in the
Russian media. LB


FEDERATION COUNCIL AGAIN POSTPONES VOTE ON LAND CODE. During a 28
January session in St. Petersburg, the Federation Council postponed
debate on the land code until next month, Council Speaker Yegor Stroev
told Interfax. The upper house has delayed consideration of the code
several times since the Duma overrode a presidential veto on the code
last September. According to Stroev, the Council will vote on the land
code using written ballots, allowing deputies who do not attend the
February session in Moscow to vote by mail. Yeltsin claims that voting
procedure is unconstitutional. He cited the use of mailed-in ballots as
grounds for his refusal to sign the trophy art law after both houses
overrode his veto last spring. At roundtable talks last month,
executive and legislative officials agreed to work out a compromise on
the land code within three months (see "RFE/RL Newsline," 29 December
1997). LB


NEWSPAPER PREDICTS NEXT ELECTION 'WILL NOT BE DEMOCRATIC.' Two
prominent commentators for "Nezavisimaya gazeta" argued  on 28 January
that the presidential election held in 2000 "will not be and cannot be
democratic," since Russia lacks a large middle class. "Financial
clans," not voters, will choose the next president, they argued.
Favored candidates will be presented as an alternative to a "bogeyman"
who, in turn, will be portrayed as a destroyer of the country. In 1996,
Communist Party leader Gennadii Zyuganov served as the "bogeyman" who
threatened to return Russia to the past, the authors argued. In
contrast, elites will attempt to frighten the people in 2000 by
accusing various presidential contenders of being too close to
"bankers, the gas industry, Americans, and so on." "Nezavisimaya
gazeta" is almost completely funded by the LogoVAZ group of Boris
Berezovskii, who provided substantial financial support to Yeltsin's
1996 presidential campaign. LB


LATEST KILLING SPREE HIGHLIGHTS DRUG ABUSE IN MILITARY. Oleg Naumov,
who killed seven fellow soldiers in Sakhalinsk on 26 January, was "high
on acetone fumes" at the time and is a self-confessed substance abuser,
Russian media reported. Naumov, who has been taken into custody, says
he does not remember the shooting spree because he was "so high" at the
time. The previous day outside Moscow, a soldier killed one of his
colleagues. Several articles in Russian newspapers show that youths
have serious doubts about serving in the army. According to the "Noviye
Izvestiya" of 28 January, more than 70 soldiers have been killed by
fellow servicemen since April 1995. BP


COURT CLOSES NEWSPAPER IN BASHKORTOSTAN. A city court in Neftekamsk
(Republic of Bashkortostan) on 26 January shut down the local newspaper
"Vechernii Neftekamsk." Bashkortostan's Ministry on the Press and Mass
Media filed the lawsuit, claiming that the newspaper has repeatedly
published false information about the republic's leaders. In an
interview with RFE/RL's Moscow bureau on 28 January, Eduard
Khusnutdinov, the founder and editor of "Vechernii Neftekamsk," said
his newspaper has been persecuted for criticizing the republic's
authorities. For example, it is imported from neighboring Udmurtia,
because no type-setter in Bashkortostan will print it. Khusnutdinov
added that Bashkortostan's media law, which the court cited in its
decision to close "Vechernii Neftekamsk," violates federal legislation
and the Russian Constitution. "Kommersant-Daily" reported on 16 January
that Khusnutdinov is running against local businessmen in a by-election
for a State Duma seat in February. LB


'PERSECUTION' OF MEDIA DECRIED IN ULYANOVSK. Some 1,000 people staged a
demonstration in Ulyanovsk on 27 January demanding an end to
"persecution" of local journalists, RFE/RL's correspondent in Ulyanovsk
reported. The newspaper "Simbirskie gubernskie novosti" organized the
rally, which was supported by other publications that oppose the oblast
administration. Since he won a December 1996 election, Ulyanovsk
Governor Yurii Goryachev has filed numerous libel lawsuits against
media that have criticized him or portrayed the situation in the oblast
in an unfavorable light. He has repeatedly won such lawsuits, even when
the offending article did not mention Goryachev's name. Journalists say
they are denied access to basic information about the Ulyanovsk
administration. Meanwhile, the oblast provides some 8 million rubles
($1.3 million) annually in subsidies to loyal media. Speakers at the 27
January rally urged the federal authorities to guarantee equal rights
for all publications in Ulyanovsk. LB


STATE-OWNED MEDIA CENSORED IN CHELYABINSK. Vitalii Ponurov, the
chairman of the Chelyabinsk Oblast State Television and Radio Company,
recently ordered that any news reports on top officials in Chelyabinsk
must be cleared by the company's first deputy chairman, Boris Durmanov,
"Kommersant-Daily" reported on 28 January. Most local media in
Chelyabinsk have provided friendly coverage to Governor Petr Sumin and
his administration since Sumin was elected in December 1996. A rare
exception was a recent radio report quoting a local human rights
defender, who sharply criticized Chelyabinsk Premier Vladimir Utkin.
Four days later, Ponurov issued the order that in effect establishes
prior review censorship at state-owned radio and television in the
oblast. In most Russian regions, state-controlled electronic media
offer  largely or exclusively favorable coverage of the regional
authorities. Article 29 of the constitution prohibits censorship, but
that ban has not been enforced. LB


TRANSCAUCASUS AND CENTRAL ASIA


ARMENIAN OPPOSITION LEADER CALLS ON PRESIDENT TO RESIGN.  National
Democratic Union Chairman Vazgen Manukyan told journalists on 28
January that his party is currently holding talks with other opposition
forces on how to mobilize public pressure on President Levon
Ter-Petrossyan to force him to step down, Noyan Tapan and RFE/RL's
Yerevan bureau reported. Manukyan reiterated that Ter-Petrossyan is the
key obstacle to a just solution to the Nagorno-Karabakh conflict and
the democratization of Armenia. He said his own views on how to resolve
the Karabakh conflict are identical with those of the Karabakh
leadership. Manukyan also said that the war is unlikely to resume
because "Azerbaijan would lose it on the same day it starts it,"
adding that he believes a negotiated settlement of the conflict is
still possible.  LF


ARMENIAN PARLIAMENT SPEAKER SAYS THERE IS "NO CRISIS." In an interview
carried by Noyan Tapan on 28 January, Babken Ararktsyan played down the
discord within the country's leadership over how best to  resolve the
Karabakh conflict. Arakstsyan conceded that the Karabakh conflict has
generated internal tensions, but he denied that those tensions
constitute a "crisis." He reaffirmed the commitment of the ruling
Armenian Pan-National Movement to the de facto independence of
Karabakh,  to security guarantees for the Karabakh population, and to
the ongoing peace talks under the aegis of the Organization for
Security and Cooperation in Europe. Ararktsyan said he does not think
the attacks earlier this month on three senior officials are capable of
"jeopardizing internal stability," hinting that the parliament will not
demand the government's resignation.  LF


KARABAKH PRESIDENT REITERATES OBJECTIONS TO PEACE PLAN. Addressing the
parliament of the unrecognized Nagorno-Karabakh Republic on 28 January,
Arkadii Ghukasyan, the enclave's president, again argued that the
"phased" peace plan proposed by the OSCE Minsk Group co-chairmen is
"dangerous" for Karabakh because it stipulates a withdrawal of Armenian
forces from occupied Azerbaijani territory before a decision on the
enclave's future status. He commented that the proposal thus means
Azerbaijan has no incentive to make concessions, Noyan Tapan and
RFE/RL's Stepanakert correspondent reported.  Ghukasyan pointed out
that the "phased" plan increases the chances that hostilities will
resume because it destroys the existing balance of military forces. But
he also stressed that he does not reject the so-called "consolidated"
approach to peace talks, which entails first resolving the issue of
Karabakh's status vis-a-vis Azerbaijan and then holding talks on other
issues. LF


AZERBAIJAN LINKS RELATIONS WITH RUSSIA, CIS TO KARABAKH. Azerbaijani
Foreign Minister Hasan Hasanov told Interfax on 28 January that his
country's future relations with both Russia and the CIS are contingent
on Moscow's position on resolving the Karabakh conflict and on whether
it insists that Armenia return the weaponry it received illegally from
Russia from 1993-1996. Hasanov said that Moscow is to blame for the
difficulties that have arisen in resolving the Karabakh conflict
because of its policy of supplying arms to Armenia and the agreements
on military cooperation that it has concluded with Yerevan. LF


RUSSIAN ARMS SHIPMENT TO ARMENIA INTERCEPTED.  A convey of six trucks
belonging to the Group of Russian Troops in the Caucasus was detained
on 28 January at the Georgian-Armenian frontier, Caucasus Press
reported the next day, quoting the Georgian Ministry of National
Security. The trucks were loaded with ammunition and weapons and were
headed for Armenia on orders from the Commander of the Group of Russian
Forces in the Caucasus   Lieutenant-General Viktor Kazantsev. They were
forced to turn back. LF


TURKEY, GEORGIA DISCUSS OIL TRANSIT. Georgian presidential foreign
policy adviser Archil Gegeshidze told journalists on 28 January that
Ankara is trying to convince Tbilisi of the merits of the Baku-Ceyhan
route for the main export pipeline for Azerbaijani (and possibly also
some Kazakh) Caspian oil, Interfax and Caucasus Press reported.
Gegeshidze, who held talks with visiting Turkish Deputy Foreign
Minister Mohammed Ali Irtemcelik on 28 January,   said that
construction of a Baku-Ceyhan pipeline would not detract from the
importance of the pipeline from Baku to the Georgian Black Sea port of
Suspa, scheduled to begin operations this fall. He added that he and
Irtemcelik also discussed possible Russian participation in the export
of Caspian oil via Turkey since "the isolation of Russia is in nobody's
interests." LF


KAZAKHSTAN HAS NEW FOREIGN INTELLIGENCE SERVICE. Kazakhstan has set up
a  Foreign Intelligence Service,  ITAR-TASS and Interfax reported on 28
January.  Major-General Zhenis Ryspayev, who will head the service,
said the new agency does not intend to spy on other countries but will
coordinate activities with the special services of CIS states. He added
that the new service, who is directly subordinate to the president,
will monitor the activities of extremist religious groups, drug
smugglers, and mafia groups in order to  assess potential threats from
foreign terrorist groups. BP


KAZAKHSTAN DENIES SENDING MISSILES TO IRAN. Also on 28 January,
Ryspayev denied press reports from abroad that Kazakhstan has sold
SS-20 or SS-21 missiles to Iran, ITAR-TASS and  Interfax reported.
Ryspayev said sales of any weapons "are so closely monitored...that
it's practically impossible to [carry them out] secretly." He added
that with the help of the U.S., Kazakhstan became a nuclear-free state
in 1995 and has not produced any missiles since then. BP


TURKMENISTAN TO RESUME GAS SUPPLIES TO UKRAINE. Ukrainian President
Leonid Kuchma met with Turkmen President Saparmurat Niyazov in Ashgabat
on 28 January. Niyazov promised to resume supplies of natural gas to
Ukraine this year, even though Ukraine still owes about $600 million
for earlier supplies. A dispute between Ashgabat and  the company
contracted to deliver the gas to Ukraine, Turkmenrosgaz, led to
suspension of deliveries last March. Niyazov said his country will ship
15 billion cubic meters of gas to Ukraine but added that the delivery
depends neither on Ashgabat nor on Kyiv." The pipeline bringing gas
from Turkmenistan to Ukraine runs through Russia. Kuchma is scheduled
to meet with Russian President Yeltsin in Moscow on 30 January. BP


REGIONAL AFFAIRS


DATE OF NEXT CIS SUMMIT BROUGHT FORWARD. CIS Executive Secretary Ivan
Korotchenya told Interfax on 28 January that the next CIS summit will
be held on 19 February in Moscow. Following the cancellation of the
summit scheduled for mid-January, it was announced earlier this month
that the next summit will take place in late March. According to
Korotchenya, the top item on the agenda will be reforming the
administrative structure of the CIS and developing trade between its
members.  LF



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