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RFE/RL NEWSLINE Vol. 2, No. 141 Part I, 24 July 1998
___________________________________________________________ RFE/RL NEWSLINE Vol. 2, No. 141 Part I, 24 July 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 xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx Headlines, Part I * TRADE ISSUES HIGH ON AGENDA FOR GORE-KIRIENKO TALKS * COMMUNIST JOINS GOVERNMENT AFTER ALL * TENSION REMAINS HIGH OVER ABKHAZIA xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx RUSSIA TRADE ISSUES HIGH ON AGENDA FOR GORE-KIRIENKO TALKS. Before talks with US Vice President Albert Gore on 24 July, Prime Minister Sergei Kirienko called for the U.S. to grant Russia most-favored-nation trade status, Russian news agencies reported. "The classification of Russia as a country with a non-market economy does not meet current realities and leads to the imposition of unjustifiably high anti-dumping duties on a number of key export items," Kirienko said. ITAR-TASS quoted an unidentified source in the Russian-U.S. Commission on Economic and Technological Cooperation as saying that Gore has agreed to support Russia's demand for permanent MFN status. Meanwhile, Gore told the Russian delegation that he and President Bill Clinton are "absolutely committed to deepening [U.S.-Russian] relationships." Gore arrived in Moscow on 23 July and will leave late on 24 July. Instead of flying to Karelia to meet with vacationing President Boris Yeltsin, as some Russian media speculated, he is to speak to Yeltsin by telephone on 24 July. BT PRIMAKOV IN BEIJING. Russian Foreign Minister Yevgenii Primakov gave a press conference in Beijing on 23 July, ITAR- TASS and China's Xinhua news service reported. Primakov said after talks with his Chinese counterpart, Tang Jiaxuan, that neither country would impose sanctions on India or Pakistan for conducting nuclear weapons tests. But he added that Moscow and Beijing want all countries possessing or close to possessing nuclear weapons to sign the Nuclear Non- Proliferation Treaty. Primakov also said independence for Kosova "cannot even be discussed," adding that "the Contact Group's integrity should guarantee success in settling the Kosova problem." Primakov noted that China shares his country's view on this point. The Russian official also met briefly with Chinese President Jiang Zemin. ITAR-TASS reported only that Primakov expressed his country's condolences over the loss of life in recent flooding in China. BP RUSSIAN MILITARY DELEGATION ARRIVES IN CHINA. A Russian military delegation led by first deputy chief of the general staff, General Valerii Manilov, arrived in China on 23 July, ITAR-TASS and Xinhua reported. Manilov held talks with Lieutenant-General Xiong Guangkai, the deputy chief of staff of the Chinese People's Liberation Army. The two sides discussed the regional and international situations and, according to Xinhua, "reached extensive consensus." They also discussed military cooperation, confidence-building measures, and the current reform of both armies. Manilov and the delegation are on a six-day visit. BP CHECHEN PRESIDENT SAYS FOREIGN SPECIAL SERVICES BEHIND ATTACK. Chechen President Aslan Maskhadov said on 23 July that the attack against him may have been the "joint work of several special services" who were able to enlist local allies "craving for power and money," Interfax reported. (The Russian Federal Security Service said it has no information about the possible involvement of any security service.) Acknowledging that he was slightly injured in the attack, which killed one of his bodyguard, Maskhadov said that he had expected even worse things when he became president. "Explosions and incidents are inevitable in a country that has gone through such a grave war." But he suggested that those counting on playing one resistance leader against another or using Islam to topple his government "will not succeed." PG FIVE SCENARIOS BEHIND ATTACK ON MASKHADOV. Chechen Deputy Prosecutor-General Magomed Magomadov told Interfax on 23 July that he had identified five scenarios for the assassination attack: foreign special services, local opposition politicians, officials who lost their positions as a result of the Gudermes controversy, religious extremists, and a fifth column of Chechens supported by Moscow. One possible suspect has already been cleared. On 24 July, the Supreme Shariat Court concluded that former Chechen President Zelimkhan Yandarbiev had no involvement in the attack. But despite the attack, Chechen officials have played down the security problems in Grozny. On 23 July, Chechen military commander Aslambek Ismailov said he sees no need to increase security measures there, ITAR-TASS reported. PG YELTSIN, OTHERS DECRY ATTACK ON MASKHADOV. Russian President Yeltsin sent Maskhadov a telegram to express his "profound concern and indignation" over the assassination attempt. He also ordered Russia's security services to investigate the crime, Interfax reported on 23 July. Among other Russian officials who denounced the attack on the Chechen president were Yeltsin's personal envoy for Chechnya, Ivan Rybkin, Krasnoyarsk Krai Governor Aleksandr Lebed, CIS Executive Secretary Boris Berezovskii, and National and Regional Policy Minister Yevgenii Sapiro, Russian news agencies reported. Other leaders who have condemned the attack include Dagestani leader Magomedali Magomedov and Georgian President Eduard Shevardnadze. PG COMMUNIST JOINS GOVERNMENT AFTER ALL... State Duma Economic Policy Committee Chairman Yurii Maslyukov, a member of the Communist Party's Central Committee, defied party discipline on 23 July to accept the post of industry and trade minister. The ministry was created during the April cabinet reshuffle, when the Foreign Trade Ministry was abolished. Until now, Georgii Gabuniya has served as acting minister. Although the Central Committee's Presidium spoke out against Maslyukov joining the government (see "RFE/RL Newsline," 23 July 1998) Maslyukov told journalists that half the members of the Communist faction in the State Duma supported his decision, RFE/RL's Moscow bureau reported. Maslyukov held various positions in the Soviet defense industry and the economic planning agency Gosplan, which he headed during the late Gorbachev period. LB ...SEEKS OVERSIGHT OF DEFENSE INDUSTRY AND SCIENCE POLICY. Maslyukov told journalists on 23 July that Prime Minister Kirienko supports his vision for the Industry and Trade Ministry, which includes giving that ministry oversight of the defense industry and the arms trade, Russian news agencies reported. The Economics Ministry, headed by Yakov Urinson, currently supervises those matters. "Kommersant- Daily" claimed on 24 July that "influential forces" in the presidential administration support keeping defense industry- related matters under the purview of the Economics Ministry, and that Kirienko will let Urinson and Maslyukov do battle in the coming months before making a final decision. Urinson worked under Maslyukov in Gosplan, the newspaper said. Maslyukov also wants science policy to fall under the control of the Industry and Trade Ministry, which would be a blow to Science and Technology Minister Vladimir Bulgak. LB PRIMORE GOVERNOR TO STAY OUT OF CABINET. Primorskii Krai Governor Yevgenii Nazdratenko told Interfax on 23 July that it would not be "desirable" for him to join the federal government now (see "RFE/RL Newsline," 23 July 1998). He praised Kirienko as "an intelligent man of integrity" but said future socioeconomic developments will demonstrate whether the government should include new members from among regional leaders. In an interview published in "Vremya-MN" on 20 July, Nazdratenko argued that "social tension is inevitable," adding that "the government simply has no mechanism to stop people" if they march on Moscow. Relations between Nazdratenko and previous federal governments have been strained, in part because of the long-standing enmity between the governor and former First Deputy Prime Minister Anatolii Chubais. In recent weeks, Samara Oblast Governor Konstantin Titov and Novgorod Oblast Governor Mikhail Prusak have also reportedly turned down invitations to join the cabinet. LB DUMA SPEAKER SAYS SPECIAL SESSION NO SURE THING... Gennadii Seleznev told journalists on 23 July that the Duma may not convene a special session in August to consider laws in the government's anti-crisis program, Russian news agencies reported. Seleznev argued that such a session would be "a very expensive treat." He noted that some of the draft laws have not yet been submitted to the Duma, and also argued that consideration of some laws can wait until the Duma is scheduled to reconvene in September. However, Seleznev said a special session between 17 and 22 August is still possible. He repeated his belief that a new IMF stabilization loan will provide only short-term help for Russia. He also charged that the government's move to triple individual contributions to the Pension Fund is unconstitutional (see "RFE/RL Newsline," 22 and 23 July 1998). LB ...AGREES WITH OIL COMPANIES' WARNING. Speaking to journalists on 23 July, Seleznev also agreed with a recent statement by oil companies warning that the government's policies are influenced by international financial organizations and could lead to social unrest (see "RFE/RL Newsline," 22 and 23 July 1998). He said leading oil industry executives "understand perfectly" that loans from the IMF will not solve Russia's long-term problems, Interfax reported. He also argued that heads of oil companies know better than the president, prime minister, or "anyone else what state the Russian economy is in." However, Seleznev added that Russian policy should be shaped by the legislative and executive branches, not by oligarchs, Interfax reported. LB 'NEZAVISIMAYA' AGAIN ADVOCATES TEMPORARY STATE COUNCIL. Vitalii Tretyakov, the editor-in-chief of "Nezavisimaya gazeta," on 24 July repeated his call for the formation of a Temporary State Council to preside over early presidential and parliamentary elections (see "RFE/RL Newsline," 13 July 1998). He blasted Yeltsin's governing style and characterized the president as Russia's main "oligarch." Tretyakov concluded that only two possible scenarios, if accompanied by the creation of a Temporary State Council, would stave off both social unrest and dictatorship: the return of Viktor Chernomyrdin to the post of prime minister or the appointment of a "new government." The leading candidate to head a new government would be Yabloko leader Grigorii Yavlinskii, Tretyakov argued, although he listed other possibilities as well, including Alfa Bank head Petr Aven or "someone else among the oligarchs" who has already held a state post. "Nezavisimaya gazeta" is financed by CIS Executive Secretary Boris Berezovskii's LogoVAZ group. LB CENTRAL BANK LOWERS REFINANCING RATE. The Central Bank on 24 July reduced its annual refinancing rate from 80 percent to 60 percent. ITAR-TASS noted that it is the ninth change in the benchmark rate since the beginning of the year. In an effort to protect the ruble, the Central Bank raised the refinancing rate from 28 percent to 42 percent in February, then lowered it three times before recurring instability on financial markets prompted two rate hikes in May, bringing the refinancing rate to 150 percent. The bank lowered the rate to 60 percent in early June but raised it to 80 percent three weeks later as the sell-off of Russian securities continued. The first $4.8 billion tranche of an $11.2 billion IMF loan will be used to bolster the Central Bank's hard- currency reserves, which stood at $13.6 billion as of 17 July. LB GOVERNMENT SLASHES LIST OF 'STRATEGICALLY IMPORTANT' COMPANIES. The government has cut the list of state-owned companies that may not be privatized in the near future from some 3,000 to 697, ITAR-TASS reported on 23 July. The 2,300 companies removed from the list of firms that produce goods of "strategic importance" are to be sold, but no time frame for their sale has been announced. The 697 enterprises that remain on the list span a wide variety of industries and sectors, such as nuclear facilities, weapons producers, health and medical facilities, metallurgy, oil and chemical companies, communications enterprises, airports, shipping lines and seaports, and Russian Public Television, the Channel 1 broadcaster that is only 51 percent state-owned. Opposition deputies in the Duma have denounced plans to shorten the list of strategically important companies. LB PRIVATIZATION REVENUES BELOW TARGET IN FIRST HALF OF 1998. The State Property Ministry announced on 22 July that federal budget revenues from the sale or management of state-owned property totaled some 1.6 billion rubles ($257 million) during the first half of 1998, "Kommersant-Daily" and "Nezavisimaya gazeta" reported on 23 July. That figure is less than 20 percent of 1998 budget targets for such revenues. The two biggest privatization auctions planned for later this year involve 75 percent plus one share in the oil company Rosneft and 25 percent minus two shares in the telecommunications giant Svyazinvest. An attempt to sell the Rosneft sale failed in May, and in early July the government extended by another three months the deadline for submitting bids for the oil company (see "RFE/RL Newsline," 10 July 1998). LB RUSSIA, EU FORMALIZE TEXTILE AGREEMENT. Officials from Russia and the EU on 23 July signed an agreement reached in March on textile trade, Reuters reported. Russia agreed to lift import quotas on carpets from the EU (see "RFE/RL Newsline," 1 April 1998). The European Commission says the value of annual EU carpet sales to Russia exceeds 200 million Ecu ($220 million). In exchange, the EU agreed not to renew its quotas on more than 30 types of Russian textiles after 1 May. In April, the EU stopped considering Russia a "non-market economy," allowing Russian industries to be considered on a case-by-case basis in disputes over anti-dumping duties. LB NUCLEAR WEAPONS WORKERS STAGE WARNING STRIKE IN NIZHNII NOVGOROD. Some 3,500 workers at the Federal Nuclear Center in Sarov (former Arzamas-16), Nizhnii Novgorod Oblast, stopped work for three hours on 23 July to protest non-payment of wages, media reported. The workers threaten an indefinite strike if their demands for the payment of wages totaling 90 million rubles ($14.5 million) from 1997-1998 and for wage hikes are not met, RFE/RL's correspondent in Nizhnii Novgorod reported. The strike committee kept workers in radiation- sensitive areas on the job, but a representative of the complex's management warned "there are elements of danger in any case." In May, Prime Minister Kirienko visited the nuclear-weapons research center and promised that "money will always be found" for its operations. The Atomic Energy Ministry has so far received 30 percent of what it is due from the 1998 budget, "Nezavisimaya gazeta" reported on 24 July. BT TWO REGIONS AIM TO INTRODUCE ALTERNATIVE SERVICE. St. Petersburg and the Republic of Tatarstan are aiming to introduce alternative service, "Kommersant-Daily" reported on 23 July. Article 59 of the Russian Constitution provides for forms of service other than military in cases where personal convictions or religious beliefs prevent military activity. However, a federal law on alternative service has been held up in the Duma since 1994 owing to on-going opposition from the Duma Defense Committee (see "RFE/RL Newsline," 8 January and 5 May 1998). The daily reported that "the silence of the Duma and the many appeals of conscripts' parents forced" the Tatarstan legislature to introduce its own law, which has passed in the first reading. Instead of introducing a regional law, St. Petersburg Governor Vladimir Yakovlev has proposed that Yeltsin issue a presidential decree allowing alternative service in St. Petersburg. BT TRANSCAUCASUS AND CENTRAL ASIA TENSION REMAINS HIGH OVER ABKHAZIA. Liviu Bota, the UN secretary-general's special representative for Georgia, told a meeting of Georgian, Abkhaz, and Russian officials in Geneva on 23 July that "the potential for a new outbreak of hostilities is real," AP reported. Meanwhile, the Georgian Foreign Ministry condemned Abkhazia for the hostage-taking of five people in the Zugdidi region, an action that the Abkhaz officials have denied being involved in, ITAR-TASS reported. And in the wake of the 22 July mine explosion in which nine Russian soldiers were wounded, the Russian Defense Ministry warned Georgia against supporting anyone who attacks Russian peacekeepers in Abkhazia, the Russian agency said. The local commander of CIS peacekeeping forces, General Sergei Korobko, said that unless conditions improved, he will seek additional forces from other CIS countries to control the situation. PG TALBOTT PLEDGES U.S. SUPPORT FOR GEORGIA. Deputy Secretary of State Strobe Talbott told Georgian President Eduard Shevardnadze and other senior officials in Tbilisi on 23 July that Washington seeks to support the development of a democratic, prosperous, and independent Georgia, ITAR-TASS reported. According to Georgian parliamentary speaker Zurab Zhvania, Talbott also said the U.S. will provide special assistance to help Georgia protect its borders and support refugees from Abkhazia. PG ALIEV SIGNS NEW OIL AGREEMENTS IN LONDON. Azerbaijani President Heidar Aliev completed his five-day visit to London on 23 July by signing three new agreements on the exploitation of Caspian basin oil, Interfax reported. PG UN MOURNS EMPLOYEES KILLED IN TAJIKISTAN. A ceremony was held at the UN compound in Dushanbe on 24 July in honor of the three UN employees who, along with their driver, were killed by unknown assailants on 20 July, ITAR-TASS reported. The bodies of military observers Richard Shevchek (Poland) and Adolfo Sherpegi (Uruguay) as well as civilian affairs observer Yukata Akino lay in state outside the compound's main building. Their Tajik driver/translator Jurajon Mahramov was buried in accordance with Islamic tradition on 22 July. Meanwhile, field commanders from the United Tajik Opposition based in the Pripamirye area, where the UN workers were killed, have joined efforts to locate the perpetrators of the crime. BP EBRD EXTENDS LOAN TO KAZAKHSTAN. The European Bank for Reconstruction and Development on 23 July announced it will grant Kazakhstan a $40 million loan, Interfax reported. The loan will be released in two tranches of $20 million and used to finance medium- and long-term transportation, construction, industrial, and public sector projects. The EBRD has the option of using funds from the first tranche to buy shares in the Kazakh bank to which it releases the money. BP LOOMING CRISIS IN KAZAKH OIL SECTOR? Kazakh Prime Minister Nurlan Balgimbayev told a meeting of senior officials of the country's oil industry on 22 July that the situation in the oil sector is "very serious," Interfax reported. Balgimbayev said that "production is not competitive" and that refineries in Pavlodar and Chimkent are "on the verge of grinding to a halt." A government commission, headed by First Deputy Prime Minister Uraz Jandosov, has been charged with helping the country out of "its pre-crisis situation." BP xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx Copyright (c) 1998 RFE/RL, Inc. All rights reserved. xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx HOW TO SUBSCRIBE Send an email to firstname.lastname@example.org with the word subscribe as the subject of the message. HOW TO UNSUBSCRIBE Send an email to email@example.com with the word unsubscribe as the subject of the message. 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