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RFE/RL NEWSLINE Vol. 2, No. 172 Part II, 7 September 1998
___________________________________________________ RFE/RL NEWSLINE Vol. 2, No. 172 Part II, 7 September 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 II, a compilation of news concerning Central, Eastern, and Southeastern Europe. Part I covers Russia, Transcaucasia and Central Asia 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 xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx SPECIAL REPORT: HOW RUSSIA IS RULED--1998 As the string of crises continue in Russia, the question remains: Who is in charge? This in-depth report analyzes the country's power structure. http://www.rferl.org/nca/special/ruwhorules/index.html xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx Headlines, Part II * IMF APPROVES $2.2 BILLION LOAN TO UKRAINE * U.S. OFFICIALS REPORT 'HORRENDOUS' CONDITIONS IN KOSOVA * EU BANS YUGOSLAV FLIGHTS xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx EAST-CENTRAL EUROPE IMF APPROVES $2.2 BILLION LOAN TO UKRAINE. The IMF Board of Directors on 4 September approved a three-year $2.2 billion loan to Ukraine. The first tranche of the loan, worth some $260 million, will be released "within days," Ukrainian News reported on 5 September. The disbursement of the other tranches will depend on Ukraine's compliance with the reform program for 1998-2001 agreed by the IMF and the Ukrainian government. That program aims at increasing state finances and continuing structural reforms as well as tightening fiscal policies to control government spending. The program foresees GDP growth at 4 percent by 2001, compared with -0.3 percent in 1997. Inflation is expected to drop from 10 percent to 7 percent, and hard currency reserves are slated to increase to the equivalent of seven weeks' imports, compared with 6.3 weeks in 1997. JM UKRAINE INTRODUCES NEW HRYVNYA EXCHANGE CORRIDOR. Following its announcement last week (see "RFE/RL Newsline," 2 September 1998), the Ukrainian government has de facto devalued its currency by introducing a new hryvnya exchange rate corridor. On 5 September, the new exchange rate corridor of 2.5-3.5 hryvni to $1 dollar replaced the previous band of 1.8-2.25 hryvni to $1. A joint statement by the cabinet and the Ukrainian National Bank said the move is aimed at maintaining export-import operations, ensuring the competitiveness of exports on foreign markets, averting capital outflow from Ukraine, and reducing the number of barter operations. The value of the Ukrainian hryvnya has declined almost 30 percent since January 1998, when the currency band was established. The central bank's reserves have dwindled to some $800 million following the bank's unsuccessful attempts to maintain the hryvnya within the previous exchange range. JM LUKASHENKA OFFERS TO ADVISE MOSCOW ON FINANCIAL CRISIS... Belarusian President Alyaksandr Lukashenka on 4 September offered to advise Moscow how to deal with the current economic crisis in Russia, Interfax and Reuters reported. Addressing a rally in Rechytsa, Lukashenka argued that the Russian crisis has political rather than economic roots. He told journalists after the rally that he is ready to discuss the crisis with Russian President Boris Yeltsin "to the extent that Boris Nikolayevich himself needs it. I think that consultations with Belarus wouldn't hurt him." Lukashenka suggest that Russia opt for "all the best things which have been tested in Belarus and already shown to work," Interfax quoted him as saying. JM ...SAYS HE WILL NOT ATTEND CIS CUSTOMS SUMMIT. Speaking in Mahilyou the previous day, the Belarusian president said he will not attend the CIS customs summit scheduled for 10 September in Astana, Kazakhstan, Belapan reported. Lukashenka said he consider it inappropriate to schedule at the same time Russian President Yeltsin's visit to Kazakhstan and the summit of the CIS Customs Union heads of state. "Who needs this mess?" he commented. Lukashenka added that the second reason for his refusal to visit Astana is the lack of support among the CIS Customs Union member states for the agreement on a CIS single economic area and for Kazakhstan President Nursultan Nazarbayev's program entitled "On Ten Simple Steps To Meet Ordinary People." The 4 September "Russkii telegraf" suggests that the true motive behind Lukashenka's decision is his unwillingness to support Yeltsin at the summit. JM BELARUSIAN RUBLE PLUMMETS ON INTERBANK CURRENCY EXCHANGE. The Belarusian ruble decreased significantly on 4 September in response to Russia's crisis, Belapan and AP reported. The exchange rate for non-cash operations on the Interbank Currency Exchange plunged to some 300,000 Belarusian rubles to $1, down from 80,000 Belarusian rubles to $1 in mid-August. According to commercial bank experts quoted by Belapan, the ruble plunge shows that "Belarus has begun to reap the harvest of its integration with Russia." Among the domestic reasons for the ruble collapse, they cited numerous administrative restrictions on financial operations in Belarus and a recent large credit emission reportedly undertaken by the National Bank. The unofficial exchange rate on 4 September was some 100,000 Belarusian rubles to $1, while the official exchange rate stood at 50,400 Belarusian rubles to $1. JM IMF SAYS ECONOMIC OUTLOOK FOR ESTONIA REMAINS POSITIVE. In a press release on 4 September, the IMF argued that the outlook for Estonia's economy remains positive, despite the financial crisis in Russia, ETA reported. The fund noted that in the medium term, there may be some adverse impact on GDP growth and balance of payments. But "given Estonia's commitment to market- oriented reforms, its stable macroeconomic environment, and the discipline instilled by the currency board arrangement and strict bank supervision," the impact could remain limited. In a program drawn up last year with the IMF, Estonia is seeking to reduce inflation to below 9 percent and achieve GDP growth of 8 percent this year. According to the IMF, the program's targets for the end of 1997 and the first half of this year have been largely met. JC CLINTON URGES LATVIA TO SUPPORT CITIZENSHIP AMENDMENTS. In a letter to his Latvian counterpart, Guntis Ulmanis, U.S. President Bill Clinton stressed that granting citizenship to Latvia's Russian-speaking minority is essential for the country's integration into Euro- Atlantic institutions. According to Ulmanis' office on 4 September, Clinton pointed out that Latvia's handling of the issue will be watched closely in the West and will affect its efforts to join such institutions as the EU and NATO. He added that the U.S will not support further attempts by the international community to suggest new recommendations on amending the citizenship law, nor will it support any amendments that are not in compliance with OSCE recommendations. Ulmanis backs the amendments to the citizenship law, but the nationalist- inclined Fatherland and Freedom Party successfully pushed for a referendum on the issue. That vote is scheduled for 3 October. JC OSCE CONFIRMS CLOSURE OF SKRUNDA. OSCE inspectors have confirmed that the early-warning anti-missile radar station at Skrunda ceased operations on 31 August, in accordance with a 1994 Latvian-Russian agreement, BNS reported on 4 September. The dismantling of the Soviet- era station was begun on 1 September and is scheduled to be completed by 29 February 2000. During the period in which the station is dismantled, Russia will continue to pay Latvia rent for the site. JC POLAND REJECTS COMPENSATION CLAIMS BY GERMAN EXPELLEES. Polish Foreign Minister Bronislaw Geremek told Polish Radio on 6 September that Poland rejects compensation claims by ethnic Germans who resettled to Germany after World War II. Geremek added that such payments should be made by the German government. Noting that Poland paid compensation to Poles expelled from areas annexed during the war by the Soviet Union, Geremek said "let the German government do likewise." Geremek's statement was in response to a renewed claims by Erika Steinbach, leader of Germany's Alliance of Expellees, at a rally in Berlin earlier the same day. "One would be satisfied with symbolic compensation," Reuters quoted Steinbach as saying. It is estimated that German expellees from Eastern Europe and their descendants make up some 20 percent of the German population. JM POLAND, GERMANY, DENMARK SET UP JOINT MILITARY CORPS. Janusz Onyszkiewicz, Volker Ruehe, and Hans Haekkerup, defense ministers of Poland, Germany, and Denmark, met in Szczecin on 5 September to sign an agreement on the creation of a joint NATO military corps, PAP and dpa reported. The 60,000-strong corps will consist of three mechanized divisions, one in each country, which will train soldiers for peacekeeping missions and rescue operations during natural disasters. The corps staff will be located in Szczecin. "The corps here in Szczecin does not mean a German or Danish expansion into the East, but a reunification of Europe," dpa quoted Ruehe as saying. JM CZECH REPUBLIC ALLOWED ILLEGAL ARMS EXPORTS TO NORTH KOREA. The Czech Republic continued to allow exports of arms to North Korea and other communist countries between 1992 and 1997, although such exports were illegal, "Lidove Noviny" reported on 5 September. The newspaper said a Czech company run by a Russian businessman, identified as "A.K.," exported a total of 365 military vehicles and other weapon systems to North Korea, China, and Slovakia. In October 1997, the businessman was accused of illegal export activity and taken into custody. Chief of Staff General Jiri Sedivy told "Lidove Noviny" that the exports may turn out to be " a big problem" for the Czech Republic. The Defense Ministry refused to comment, saying it will issue a statement "within a few days," AP reported. MS POLL SHOWS STRONG SUPPORT FOR NEW OPPOSITION COALITION. An opinion poll conducted on behalf of Czech state television indicates that the new opposition coalition will receive almost a quarter of the vote in the elections to the Senate scheduled for 13-14 November, CTK reported on 6 September. The new coalition--composed of the Freedom Union, the Christian Democratic Party, the Democratic Union, and the Civic Democratic Alliance- -received 24 percent backing. The poll also indicates that the governing Social Democrats (CSSD) will receive 35 percent support and the main opposition Civic Democratic Party (ODS) 26 percent. The CSSD and the ODS are partners in the so-called "opposition agreement," which allows the CSSD to rule as a minority government. MS EXODUS OF SLOVAK ROMA TO BRITAIN INCREASES. The exodus of Slovak Roma from eastern Slovakia who apply for asylum in Great Britain is increasing, AP reported on 4 September, citing Slovak newspapers. The agency said 1,256 members of the Roma minority in Slovakia have applied for asylum, most of them from the Michalovce area. MS HUNGARIAN SOCIALISTS ELECT NEW LEADER. At its congress on 5 September, the opposition Hungarian Socialist Party (MSZP) elected former Foreign Minister Laszlo Kovacs as party chairman, Hungarian media reported. Kovacs, who is also the party's parliamentary group leader, won by a vote of 384 to 144 over former trade union leader Sandor Nagy. Kovacs replaces ex-Premier Gyula Horn, who after the party's defeat in the May general elections announced that he will step down. "The MSZP can succeed only if it becomes a modern social democratic party," Kovacs said. The congress also elected Peter Kiss as executive deputy chairman and Gyorgy Foldes as chairman of the party's National Board. MSZ SOUTHEASTERN EUROPE U.S. OFFICIALS REPORT 'HORRENDOUS' CONDITIONS IN KOSOVA... U.S. Assistant Secretary of State John Shattuck said on 6 September that he and former U.S. Senator Bob Dole have seen evidence of "horrendous" rights violations after a tour of central Kosova, Reuters reported. Shattuck said he and Dole--the chairman of the International Commission on Missing Persons--saw "violations of humanitarian law and acts of punitive destruction." Dole is investigating reports that missing Serbs and ethnic Albanians are being held prisoner by either side. Shattuck said reports of Serbian security forces separating men and boys at gunpoint from groups of refugees will be a topic of discussion when he and Dole meet with Yugoslav President Slobodan Milosevic in Belgrade on 7 September. Shattuck also warned that many ethnic Albanians were in danger of dying of starvation and exposure if the wholesale destruction of villages by Serbian forces continues. PB ...DEMAND THAT BELGRADE INCREASE ACCESS TO KOSOVA. Shattuck said that the U.S. wants forensic experts allowed into the Serbian province to investigate alleged atrocities by both Serbs and ethnic Albanians, AP reported. Dole said they have heard "chilling" accounts of atrocities and that despite Western promises not to allow crimes against humanity to occur in Kosova, like those that took place in Bosnia, "such crimes are already happening." Shattuck said Serbian claims of crimes against humanity will be in doubt if experts are not allowed to verify the claims. That Yugoslav officials continue to deny visas to such experts is "absurd," Shattuck said. PB KINKEL REJECTS U.S. ENVOY'S CRITICISM. German Foreign Minister Klaus Kinkel on 6 September strongly refuted allegations by U.S. Ambassador to Macedonia Christopher Hill that Europe is indifferent to solving the Kosova crisis, Reuters reported. Kinkel, speaking on the sidelines of an EU foreign ministers' meeting in Salzburg, called Hill's comments "cynical and condescending" and said that the EU is "not the world's policeman." At the same time, Kinkel said the EU should appoint its own special envoy to Kosova, such as the U.S. has done with Hill. Hill said in a speech in the U.S. on 4 September that the EU is content on forging a united Europe that conveniently does not include the Balkans. PB EU BANS YUGOSLAV FLIGHTS. The EU on 6 September announced it will prohibit Yugoslav national airline (JAT) flights to the EU, AP reported. The move was announced at the EU foreign ministers' meeting in Salzburg after Athens dropped its reservations against the ban. The sanction on JAT will be in force until Belgrade halts its crackdown on ethnic Albanians in Kosova, officials said. PB SERBS SAID TO HAVE CAPTURED 450 SUSPECTED REBELS. Serbian police reportedly detained some 450 suspected members of the Kosova Liberation Army (UCK), dpa reported on 6 September. The Serbian Media Center said some 250 men were captured near Klina and another 200 in the central Kosova region of Orahovac, both areas the scene of heavy fighting between Serbian and UCK forces recently. Kosovar Albanian sources claim many of the men are civilians and are not members of the UCK. PB UCK SPOKESMAN WARNS ABOUT DEALING WITH MILOSEVIC. Adem Demaci, the political representative of the UCK, said on 5 September that he has no faith in an interim peace accord between Yugoslav President Milosevic and Kosova "shadow state" President Ibrahim Rugova, AP reported. Demaci told the Albanian-language daily "Bujku" that he does not believe Milosevic, who, he added, is "constantly lying." Demaci said although the accord is at a preliminary stage, he fears Rugova "will make a mistake." He said Serbia uses one hand to "simulate dialogue" and the other "to exert force against our population." Milosevic and Rugova have agreed in principle to a U.S. formula granting Kosova some degree of autonomy (see "RFE/RL Newsline," 3 September 1998.). PB CROATIAN CANDIDATES BANNED FROM BOSNIAN ELECTIONS. The OSCE's Electoral Appeals Commission has disqualified 15 candidates of a Croatian nationalist party from taking part in the 12-13 September Bosnian elections, AP reported on 5 September. The members of the Croatian Democratic Union of Bosnia-Herzegovina (HDZ BiH) were banned because they allegedly received unfair and blatant support from Croatian television, which is controlled by Croatia's ruling HDZ party. The HDZ BiH has protested the action and said in a statement that the OSCE is trying to rig the election. It said it will consider boycotting the election if the OSCE's decision is not reversed. Croatian President Franjo Tudjman said the next day that the ban of ethnic Croats from the Bosnian elections is detrimental to the democratic process and the peace process in Bosnia-Herzegovina, AP reported. PB CROATIAN ELECTRIC COMPANY DEMANDS COMPENSATION FROM SLOVENIA. The Croatian Electric Power Company has formally asked the Krsko nuclear power plant in Slovenia to reimburse it for losses incurred when the plant cut off power to Croatia, HINA reported on 5 September. The company is asking for $8.6 million for outages that occurred between 30 July and 1 September. The director of the Slovenian utility company, Ivo Banic, said the request has no legal basis. Slovenia has sporadically turned off power to Croatia from the plant- -which Zagreb says is jointly owned by both countries-- because it has failed to pay its bills. PB ROMANIAN GOVERNMENT APPROVES REVISED BUDGET... The cabinet headed by Radu Vasile on 5 September approved Finance Minister Daniel Daianu's proposal to cut this year's budget by 8 trillion lei ($890 million) and to increase budget revenues by raising duties on imports and taxes on tobacco and alcohol. The cabinet also decided to impose a wage freeze and to apply an 11 percent value-added tax on newsprint, and it approved a decree whereby debts of loss-making state companies will be covered by selling shares in those companies on the bourse or through direct negotiations between prospective buyers taking over the debt and the companies' management. On 4 September, at a meeting called by President Emil Constantinescu, the leaders of the ruling coalition parties agreed to put aside differences in order to expedite reform. MS ...BUT WILL CABINET SURVIVE? The chairman of the Hungarian Democratic Federation of Romania (UDMR), Bela Marko, said after the meeting with President Constantinescu that he failed to extract from the coalition partners a promise to pass through the parliament the amendment to the education law allowing the setting up of a Hungarian-language state university. Marko added that the UDMR will support in the parliament only those economic reform measures with which it agrees. At a meeting of the UDMR's Council of Representatives on 5 September, the UDMR decided that agreement on the proposed amendment must be reached by 30 September or it will leave the ruling coalition. Such a scenario could mean the cabinet will not longer have sufficient votes to pass laws that require a special majority. MS CHIRAC PROMISES HELP AMID MOLDOVAN ECONOMIC CRISIS. French President Jacques Chirac, on a one-day visit to Moldova on 4 September, said France will help Moldova overcome the difficulties arising from the financial crisis in Russia, ITAR-TASS reported. President Petru Lucinschi said he had appealed to Chirac to intervene in order to secure assistance from the IMF and the World Bank. Lucinschi said that as a result of the Russian financial crisis, Moldova's monthly losses amount to 5 percent of GDP. The Moldovan leu has dropped by more than 25 percent against the U.S. dollar, and the National Bank has intervened to stop it falling further. National Bank governor Leonid Talmaci told AP on 4 September that the bank will not allow the devaluation to exceed 5 lei to the dollar. The parliament will convene in an emergency session on 11 September to discuss the crisis. MS BULGARIA ALLOWS CIRCUMCISION OF MUSLIM BOYS. For the first time in 50 years, the Bulgarian authorities have allowed circumcision ceremonies for Muslim boys, dpa reported on 4 September, citing BTA. More than 30 Muslim boys were circumcised on 6 September in the Teke mosque in Dobrich, northeastern Bulgaria. The circumcisions were carried out by Fawzy Ibraiamov, who was jailed under the former communist regime for illegally carrying out circumcisions. MS 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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