If we are to live together in peace, we must first come to know each other better. - Lyndon B. Johnson
RFE/RL NEWSLINE

RFE/RL NEWSLINE Vol. 2, No. 176 Part II, 11 September 1998


________________________________________________________
RFE/RL NEWSLINE Vol. 2, No. 176 Part II, 11 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

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Headlines, Part II

* MOODY'S LOWERS UKRAINE'S CREDIT RATING

* MILOSEVIC DISPARAGED AT HOME, ABROAD FOR VIOLENCE IN
KOSOVA

* INTERNATIONAL COMMUNITY IN BOSNIA CRITICIZED ON EVE OF
POLLS

End Note: THE PROMOTION OF PRIMAKOV
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EAST-CENTRAL EUROPE

MOODY'S LOWERS UKRAINE'S CREDIT RATING. Moody's
Investors Service has downgraded Ukraine's rating for
foreign-currency debts from B2 to B3 and  for foreign-
currency bank deposits from B3 to Caa3, AP reported on
10 September. The U.S. agency cited "the depletion of
Ukraine's foreign-currency reserves to dangerously low
levels over the past few months," which, it said,
suggests "an increase in the risk of default on
[Ukraine's] foreign debt obligations." Moody's also did
not share the government's optimism over the recent
approval of a $2.2 billion loan by the IMF, saying the
loan will only postpone a financial crisis if radical
economic reform is not implemented. Meanwhile, Ukrainian
Television reported on 10 September that Ukraine has
obtained the first tranche,  $257 million, of the IMF
loan. JM

UKRAINIAN PARLIAMENT REJECTS KUCHMA'S NOMINEE FOR
PRIVATIZATION CHIEF. The leftist-dominated parliament on
10 September failed to approve the state privatization
chief, raising doubts about the government's plans to
speed up privatization in the country, AP reported.
Oleksandr Bondar, Ukrainian President Leonid Kuchma's
nominee to head the State Property Fund, received 210
votes in the  parliament, 16 fewer than the necessary
simple majority. "We think that privatization and
demonopolization are two levers that pushed Ukraine into
abysmal ruin," Ukrainian Television quoted one communist
deputy as saying after the vote. Petro Symonenko, leader
of the Communist Party caucus, said privatization may
still be continued if Kuchma nominates a communist to
head the State Property Fund. JM

LUKASHENKA DEMANDS TIGHTER CONTROL OVER ALCOHOL, TOBACCO
MARKET. At a government meeting on 10 September,
Belarusian President Alyaksandr Lukashenka demanded that
"all criminal structures" be driven out of the country's
monopolized alcohol and tobacco market, Interfax
reported. He said that up to 25 percent of the
Belarusian tobacco market is controlled by criminal
gangs. Lukashenka ordered law enforcement agencies and
security services to tighten control over the production
and sale of liquor and tobacco products. He also warned
that Belarus's 67 distilleries may be reduced to as few
as 10 unless they produce "top-quality vodka." JM

KALLAS: PRIMAKOV APPOINTMENT WOULD NOT BE GOOD FOR
ESTONIA. Reform Party Chairman and  former Foreign
Minister Siim Kallas has suggested that the appointment
of Russian acting Foreign Minister Yevgenii Primakov as
prime  minister would not be favorable for Estonia and
might strain relations between the Baltic States and
Russia, BNS and ETA reported on 10 September. Kallas
said Primakov "harbors a hidden animosity toward the
Baltic States" dating back to when the Russian official
headed the Security Council under former Soviet leader
Mikhail Gorbachev. "He still bears a grudge against the
Baltic States because they broke away from the Soviet
Union," Kallas said. At the same time, he described
Primakov as a "clever but easygoing man" who would not
seek conflict. President Lennart Meri is quoted as
saying that he welcomes every move that will help Russia
end the "politically indeterminate" situation and the
economic crisis. JC

LILEIKIS TRIAL INDEFINITELY POSTPONED. The trial of 91-
year-old Aleksandras Lileikis, who is accused of crimes
against humanity during World War II, was postponed
indefinitely on 10 September after the court ordered an
independent medical examination of the hospitalized
defendant. The examination will seek to determine
whether Lileikis's health may improve sufficiently to
allow him to give evidence and attend the trial, as
required by law. According to Reuters, the examination
could take several weeks. No date for the resumption of
the trial has been set (see "RFE/RL Newsline," 9 and 10
September 1998). JC

POLAND CUTS ZLOTY DEVALUATION, BANK RATES. Poland's
Monetary Policy Council on 9 September announced it is
cutting the monthly devaluation rate of the zloty to 0.5
percent  from  0.65 percent, "Rzeczpospolita" reported
on 11 September. The council has also cut the Central
Bank's minimum 28-day money market intervention rate to
18 percent from 19 percent. The move, which follows a
fall in prices for a second consecutive month in August,
is aimed at achieving the government's goal of 9.5
percent inflation this year. According to financial
experts quoted by "Rzeczpospolita," the council's
decisions show that the Russian crisis has virtually no
impact on the Polish economy. JM

OFFICIAL SUPPORT TO VIAGRA SPARKS PROTEST OF POLISH
FEMINISTS. The Federation for Women and Family Planning
has harshly protested a cabinet minister's support for
the sale of the anti-impotence drug Viagra (see "RFE/RL
Newsline," 10 September 1998) and his proposal to
subsidize Viagra prescriptions to boost fertility rates,
AP reported. "The current government cares more about
the pleasure of men than health care for women," the
feminist organization said in a statement. The
organization added that the proposal is especially
outrageous given that the Solidarity-led government cut
subsidies for contraception earlier this year. JM

MECIAR SAYS CZECHS RESPONSIBLE FOR SLOVAKIA'S
INTERNATIONAL IMAGE. Prime Minister Vladimir Meciar on 9
September told Slovak Television that "massive Czech
propaganda" on the eve of the 1992 partition had
portrayed Slovaks as a "fascist and anti-Semitic nation"
and that "this reputation" has lingered on after
independence. "At that time Slovakia was not assessed
better than it is now," CTK quoted him as saying.  In
other news, top fashion model Claudia Schiffer, invited
by Meciar to attend  the opening of a new highway
stretch, said that "the person who will vote for number
one will not make mistakes," AP reported, citing TASR.
Meciar's party refers to itself as "number one" in the
election campaign now under way in Slovakia. MS

SLOVAKIA IMPOSES RESTRICTIONS ON MEDIA BEFORE
ELECTIONS... Slovakia is restricting political
programming on radio and television in the run-up to the
24-25 September parliamentary elections, saying such
programs violate restrictions on campaigning, RFE/RL's
Bratislava bureau reported. The Radio and Television
Council on 9  September halted a political program
scheduled to be broadcast by the pro-government Slovak
Public Television, council chairman Peter Juras told
journalists in Bratislava. He said the council also
ruled that three independent broadcasters--Markiza TV,
Radio Twist, and RFE/RL must broadcast public
announcements that they have violated the election law
in their programming. The law prohibits media from
airing electoral coverage other than the parties'
official election campaign for 30 days before the
election. MS

...AS INDEPENDENT MEDIA MONITOR SAYS STATE TELEVISION
BIASED.  Memo 98 concludes in a survey released on 10
September that  Slovak Television news coverage "has
completely abandoned any pretense of providing voters
with fair, accurate, and balanced covering of relevant
political events" and is increasingly pro-government
biased. The survey was based on the amount of coverage
devoted to various parties during news programs. Memo 98
also said Markiza TV tended to give "much positive
coverage" to opposition parties, though less so than
Slovak television's coverage of pro-government parties,
Reuters reported. Memo 98 is an independent media
monitoring group set up by the Helsinki Citizens'
Assembly and the Association for Support of Local
Democracy. MS

SOUTHEASTERN EUROPE

MILOSEVIC DISPARAGED AT HOME, ABROAD FOR VIOLENCE IN
KOSOVA. UN Secretary-General Kofi Annan disclosed the
contents of a letter he sent to Belgrade  blaming
Yugoslav President Slobodan Milosevic for indiscriminate
violence against ethnic Albanians, the destruction of
villages, and the continuing flow of refugees in Kosova,
Reuters reported. The letter, sent by Annan on 1
September, asked Milosevic to call an immediate cease-
fire. Annan has received no response from the Yugoslav
president. The UN Security Council repeated Annan's
position on 10 September. State Department spokesman
James Rubin said that the problem in Kosova will
continue until Milosevic stops Serbian forces from
"raining a humanitarian disaster down on the people of
Kosova." In Belgrade, opposition leader Zoran Djindjic
said the crisis is  the result of "the inefficiency of
the undemocratic authorities in Serbia." And in Prague,
Bulgarian Prime Minister Ivan Kostov told RFE/RL that
Milosevic is "the problem" and that the conflict would
be resolved sooner without him. PB

YUGOSLAV OFFICIALS TO BEGIN TRYING KOSOVAR ALBANIANS.
Vukasin Jokanovic, Yugoslav prosecutor-general, said on
10 September that several hundred suspected members of
the Kosova Liberation Army (UCK) will go on trial this
month, AP reported. Jokanovic, speaking on Radio
Belgrade, said that UCK forces have been decisively
defeated. Dragoljub Jankovic, the Serbian justice
minister, said 716 ethnic Albanians are under
investigation in Kosova and will face charges of
terrorism and conspiracy against the state. He said
about half of those being investigated have been
detained. PB

YUGOSLAV FOREIGN MINISTER SAYS SERBS CONTROL KOSOVA.
Zivadin Jovanovic on 10 September said that Serbian
forces control all of Kosova and that Belgrade is
willing to hold talks with ethnic Albanians to resolve
the crisis, Reuters reported. Speaking in Athens after
talks with Greek Foreign Minister Theodoros Pangalos,
Jovanovic said the UCK has withdrawn to a very small
portion of Kosova, has "no leadership," and controls no
territory. He claimed that 60,000 refugees have returned
to their homes and that schools are open. He added that
"ethnic Albanians do not trust the UCK anymore. They
express their loyalty to the Serbian authorities."
Pangalos said sanctions against Belgrade "did not help,"
and he called for Yugoslavia to be reintegrated into the
international community. PB

UCK OFFICIALS BLAST RUGOVA, U.S. The UCK said in a
statement on 10 September that support by Kosova "shadow
state" President Ibrahim Rugova for a U.S.-backed peace
accord with Belgrade will undermine the UCK's fight
against Serbian forces, AP reported. Issued by the UCK's
political wing and published in the daily "Koha Ditore,"
the statement said the proposed agreement is aimed at
"demobilizing the masses who have joined the liberation
war...and destruction of the UCK." It said that proposed
peace talks between Rugova and Belgrade are a "cover for
the Serb occupiers' terror over the civilian
population." PB

LIBERATION ARMY IN THREE PIECES? The independent news
agency Beta reported on 10 September that there are at
least three strong factions within the UCK. One faction,
thought to be the largest, recognizes Adem Demaci as its
political representative and Jakup Krasniqi as its
spokesman. It advocates complete independence from
Belgrade. Another follows orders from the head of the
so-called Kosovar government in exile, Bujar Bukoshi,
and calls itself the Armed Force of the Republic of
Kosova. It is reportedly strongest along the border with
Albania. The third faction is a small number of units
that conditionally support Rugova. PB

CROATIAN OFFICIALS INITIAL AGREEMENT ON PLOCE. Hrvoje
Sarinic, the head of the Croatian president's office,
and Economics Minister Nenad Porges signed an agreement
on 10 September that will allow Bosnia-Herzegovina free
transit to the Croatian port of Ploce, Croatian Radio
reported. Deputy High Representative Jacques Klein and
U.S. envoy Richard Sklar attended the ceremony. Sarinic
said the agreement allows for economic development both
of the port of Ploce and of Bosnia. The Croatian
parliament must still approve of the agreement, which
both sides have been working on since 1994. PB

INTERNATIONAL COMMUNITY IN BOSNIA CRITICIZED ON EVE OF
POLLS. The Brussels-based International Crisis Group
(ICG) says the international community in Bosnia-
Herzegovina is using "non-democratic" means  to help
moderates win in the 12-13 September elections, AFP
reported on 10 September. Christopher Bennett, the
director of the International Crisis Group Balkans
Project, said "the elections will bring changes, but
this will be due to non-democratic measures." Bennett
cited the omnipotent power of High Representative Carlos
Westendorp in pushing aside hard-line nationalists and
the "snatch operations" by NATO led peacekeepers as
examples of the international community's running
"roughshod" over Bosnia's democratic institutions.
Voters are to elect a new interethnic presidency,
national parliament, and legislative assemblies in the
Muslim-Croat and Serb entities of Bosnia-Herzegovina. PB

ALBANIAN OPPOSITION THREATENS FORCE AGAINST PREMIER.
Former President Sali Berisha, speaking at a rally in
Tirana, threatened to use force against the government
of Prime Minister Fatos Nano, Reuters reported on 10
September. Berisha accused Nano of abusing the
constitution and warned him not to "play with our
freedoms." Berisha said "we shall crush you into powder,
force will know no bounds." He said if Nano does not
leave office he could meet the same fate as Romanian
dictator Nicolae Ceausescu. Berisha has been holding
rallies almost every day since six former government
officials appointed by him were arrested last month.
Some 3,000 people attended the rally. PB

IMF PRAISES ALBANIA. The IMF on 10 September said that
it supports the Albanian government's economic reforms
and noted that an IMF team will visit Tirana in mid-
October, Reuters reported. Juha Kahkonen, IMF mission
chief for Albanian, said in a letter to embattled
Finance Minister Arben Malaj that the economic policies
continue to "bear fruit." PB

VAN DEN BROEK IN ROMANIA. European Commissioner Hans van
den Broek on 10 September said at a joint press
conference with President Emil Constantinescu that  all
candidates for  EU membership will eventually join the
organization but doing so depends to a large extent on
each country's performance. Van den Broek said he has
not been "updated" on the EU's performance evaluation of
all candidate countries, which was recently leaked to
the press, saying that Romania is "last" on the list of
candidate states. He urged his hosts "not to lose heart"
and to proceed with the faster implementation of
reforms, singling out the privatization of large state
companies, the banking sector, and the reform of public
administration. Constantinescu said that while it is
"possible" Romania is now in "a weak position" for
integration, the "political will" to continue reforms
exists and is backed by the population. MS

ROMANIAN RULING ALLIANCE DEBATES NEW PROTOCOL. In an
attempt to lure back the Movement of Civic Alliance into
the Democratic Convention of Romania (CDR), CDR leaders
on 10 September announced that  civic organization
members of the convention will have the right to
participate "on equal terms" in determining decisions
related to the CDR's strategy and program. But it added
that  they will not have a say in decisions related to
CDR election candidates and will be able only to make
"moral objections." The National Liberal Party and two
smaller parties have proposed that the CDR parties  be
allowed to run on separate lists in local elections.
Meanwhile, Prime Minister Radu Vasile said the elections
for mayor of Bucharest  might be "inopportune" in the
present "austerity conditions" and that a decision on
whether to hold them must be reached at the "political
level." MS

IMF DELEGATION REVIEWS MOLDOVAN ECONOMY. A five-strong
delegation headed by IMF counselor Richard Haas  began a
visit to Moldova on 10 September to evaluate the
progress of economic reform and the possibility of
renewing loans to Moldova. An agreement on  a three-
year,  $190 million loan was suspended in fall 1997
because of the stalled reform process. Moldova received
only $52.5 million of that loan, but IMF chief
representative in Moldova Mark Horton said a  $30-35
million tranche could be unfrozen in view of the impact
of the Russian crisis on Moldova's economy and the IMF's
evaluation of economic priorities included in the draft
1999 budget, RFE/RL's Chisinau bureau reported. The
delegation met on 10 September with Deputy Premier Ion
Sturdza, Finance Minister Anatol Arapu, and National
Bank Governor Leonid Talmaci. MS

BULGARIAN PREMIER ON POSSIBLE PRIMAKOV APPOINTMENT. Ivan
Kostov has welcomed the nomination of acting Russian
Foreign Minister Yevgenii Primakov as premier. Kostov
told RFE/RL in Prague on 10 September that Primakov has
demonstrated he is a "good friend."  He said Bulgarian
officials have "excellent" relations with Primakov.  MS

BULGARIA TO ACHIEVE BUDGET SURPLUS. Bulgaria is about to
register its first budget surplus since the country
began the transition to a market economy in 1990, dpa
reported on 10 September, citing BTA. The government
said that the 190 billion leva ($110 million) surplus
will be spent on improving infrastructure, social
welfare services, and the administration's information
system. In other news, the parliament on 9  September
unanimously ratified the agreement on Bulgaria's
accession to the Central European Free Trade Agreement
on 1 January. The accession agreement was signed in
Sofia in July, BTA reported. MS

END NOTE

THE PROMOTION OF PRIMAKOV

by Paul Goble

	Boris Yeltsin's decision to nominate Foreign
Minister Yevgenii Primakov as his prime minister is
already sending shockwaves through Russia, Russia's
neighbors, and the international community.
	But while this appointment may give the crisis-
ridden Russian regime some room for maneuver, it is
unlikely in itself to resolve the underlying problems
now confronting the Russian Federation. By turning away
from the obviously unpopular and apparently
unconfirmable Viktor Chernomyrdin, Yeltsin has once
again shown that he maneuvers best precisely when he is
under the most intense political pressure.
	But if Yeltsin's decision to promote Primakov was
somewhat unexpected, it nonetheless reflects three
aspects of Yeltsin's general political style.
	First, the Russian president again has taken what
many are certain to call a dramatic step only after he
had denied that he would do it.
	Second, he has selected someone who may be able to
recoup some of Russia's lost authority and influence in
the West, a clear signal that Yeltsin still hopes to
gain more Western aid even as he advances someone
popular with many Russian nationalists at home.
	And third, Yeltsin has chosen someone with little
experience in those areas--economics and domestic
affairs--that a Russian prime minister is supposed to
direct.
	This last fact makes it likely that Primakov will
face fewer obstacles to being confirmed. After all, Duma
factions, ranging from the communists to the reformers,
are likely to believe they will be able to convince
Primakov to advance their agendas. But precisely for
that reason, Primakov's appointment may not affect the
ways in which Moscow now conducts business. To the
extent that proves the case,  Primakov's appointment
ultimately may not matter as much as some hope and
others fear.
	The most obvious consequences of Primakov's
appointment are likely to be in Moscow and the Russian
Federation. Russian politicians of various stripes are
already viewing Primakov's appointment as a victory for
them or at least as a concession by Yeltsin to the
growing power of the parliament.
	Moreover, his appointment is likely to attract new
candidates for the race to succeed Yeltsin both because
Primakov is not an obvious successor and because
parliamentary deputies and governors undoubtedly feel
themselves more important players in Russian politics
than they did only a few weeks ago.  And ordinary
Russians are certain to welcome the appointment of
Primakov, a man known for his toughness and staunch
defense of Russian national interests.
	But even if these developments give Primakov a
certain honeymoon in Moscow, they will not do anything
to address Russia's economic collapse or the growing
political disorder across the country as a whole. To
address those problems, Primakov must not only craft a
new set of policies but also reinvent the Russian
government. Doing one or the other would be difficult
for anyone. But having to do both at the same time
almost certainly means that Primakov 's approach is
likely to be an amalgam of various views, a pattern that
has gotten Russia into trouble in the past and may get
Primakov into trouble quicker than many expect.
	If the exact direction Primakov is likely to take
domestically remains unclear, his approach to Russia's
neighbors and to the West is certainly far clearer.
Although Primakov has been foreign minister at a time
when Russian power has declined in the former Soviet
republics, he has been a forceful advocate of the view
that Moscow must remain the dominant player in these
countries. To the extent that he is able, he is certain
to continue to advocate a tough approach to the
neighbors. But Russia's weakness and Moscow's need to
attract Western assistance may combine to force him to
moderate his past approach.
	Perhaps Primakov's greatest role in the future will
be one that he has already starred in: stoutly defending
Russian national interests even while befriending
Western leaders.  Over his long career in the Middle
East, as a Moscow think-tank head and as foreign
minister, Primakov has pushed for a very forward Russian
policy, one designed to take advantage of any Western
weakness.
	Not surprisingly, many of his speeches and articles
in the past have been openly anti-Western and anti-
American. But despite this trend, Primakov has been
remarkably successful in winning the friendship of
Western leaders and gaining their confidence.
	Primakov's very public ties with U.S. Secretary of
State Madeleine Albright are only the most recent
example. And such attachments have allowed Primakov to
obtain more assistance from the West than his views
would seem to justify. Both he and Yeltsin clearly hope
that Primakov will once again be able to work his magic,
especially given the recent acknowledgment by Russian
officials that they had lied about conditions there in
order to gain Western aid.
	No Western leader wants Russia to fail. And
consequently, the West is likely to respond more
positively to a charm offensive by Primakov than it
would have to any steps by a  restored but rather dour
Chernomyrdin.
	But unless Primakov can turn things around in
Russia, an apparently Herculean task, he and his patron
are likely to discover that Primakov's ability to woo
Western leaders may not matter nearly as much as either
man hopes.
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