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RFE/RL NEWSLINE

RFE/RL NEWSLINE Vol 2, No. 212, Part I, 3 November 1998


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RFE/RL NEWSLINE Vol 2, No. 212, Part I, 3 November 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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Headlines, Part I

* YABLOKO CHARGES GOVERNMENT WITH CORRUPTION

* DUMA SETS CONDITION FOR START-II RATIFICATION

* GEORGIAN MUTINY LEADER DEMANDS PRESIDENT'S RESIGNATION
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RUSSIA

YABLOKO CHARGES GOVERNMENT WITH CORRUPTION... In a
letter to Prime Minister Yevgenii Primakov, State Duma
deputies and members of the Yabloko faction, Sergei
Mitrokhin, Yurii Shchekochikhin, and Anatolii Kuznetsov
pose 16 questions about allegedly suspicious activities
of members of his government. The letter, which was
published in Russian newspapers on 3 November, asked
whether First Deputy Prime Minister Yurii Maslyukov
conducted business while a member of government, whether
the government reached decisions regarding businesses
founded by Maslyukov or his relatives, and whether
Maslyukov awarded a license to the telecommunications
company Vympelkom without that company having to compete
with other firms. Similar questions were also posed
about the activities of First Deputy Prime Minister
Vladimir Gustov and Deputy Prime Minister Gennadii
Kulik. The authors of the letter explain that they
provided the questions in response to Primakov's request
that Yabloko leader Grigorii Yavlinskii explain
allegations of corruption within the government that he
made in an earlier interview with the British "Daily
Telegraph." JAC

...AS GOVERNMENT ISSUES DENIALS. Prime Minister Primakov
took the charges in stride, quipping to reporters that
Yavlinskii "did not join the government because he
didn't have enough money for the post." On a more
serious note, he said that Yavlinskii is suggesting that
corruption is so endemic throughout Russia that it
probably exists in Yavlinskii's own faction. Maslyukov
labeled the charges a "provocation" and said payments
between the Russian Space Agency and Vympelcom were
rescheduled because of the economic situation in the
country--not because of improper influence. Officials at
Vympelcom also denied Yabloko's charges, saying that the
allegation was the result of a "misinterpretation."
While some Moscow-based analysts accused Yavlinskii of
trying to start his presidential campaign with a splash,
former Prime Minister Sergei Kirienko lent Yabloko his
support, telling Ekho Moskvy that he was routinely
offered bribes when a member of government. JAC

REGIONS 'NATIONALIZE' LOCAL BANKS, INDUSTRY. The "Moscow
Times" reported on 31 October that regional governments
are poised to take controlling shares in their largest
banks. According to the newspaper, the city of St.
Petersburg plans to assume more than 25 percent of
shares in four leading banks, while Sverdlovsk Oblast
plans to merge three local banks into one in which it
will have a controlling stake. In a separate story on 3
November, the newspaper reported that Sverdlovsk is
planning to obtain a 25 percent stake in Nizhnii Tagil
Metal in exchange for a restructuring of the company's
local tax debt and wage arrears. The newspaper concluded
that such relationships may be destructive and cited the
example of Tatneft in Tatarstan: "Over the past two
years Tatneft has borrowed more than $1 billion on
international capital markets, but some of these funds
may have been diverted to pet projects of the government
rather than the company." JAC

RUSSIA DRIVING HARD BARGAIN WITH FOOD AID? The U.S. and
Russian delegations to talks on the shipment of U.S.
meat, rice, and grain to Russia have delayed final
signature on a protocol that was expected to have been
signed on 2 November. "Noviye izvestiya" argued on 31
October that despite Russia's current agricultural
crisis, Russian negotiators are in a good position to
drive a hard bargain, since Russia "consumes 32 percent
of pork exports and 41 percent of beef exports from EU
countries" and 40 percent of U.S. exports of chicken
legs. According to the newspaper, Deputy Prime Minister
Kulik is insisting that Russia needs long-term credits
to finance its food purchases. "Nezavisimaya gazeta" on
30 October compared U.S. chicken legs with their
domestic counterparts and found them lacking. It
described the U.S. frozen chicken legs as "kicking
Russia in the stomach" and dealing a blow to the
prestige of its government. JAC

DUMA SETS CONDITION FOR START-II RATIFICATION. Duma
Security Committee Chairman Viktor Ilyukhin of the
Communist Party told Interfax on 3 November that the
START-II treaty is unlikely to be ratified unless the
government guarantees that the single-warhead Topol-M
missile replaces the RS-18 and RS-20 missile systems.
Ilyukhin said that the Topol-M should be introduced
within two years of dismantling the older missiles.
Earlier, First Deputy Prime Minister Maslyukov advocated
that the government build 35-45 new Topol-M missiles
(see "RFE/RL Newsline," 8 October 1998). JAC

RUSSIA, BELARUS FORM JOINT PARLIAMENT... Representatives
to the Union of Russia and Belarus meeting in Yaroslavl
on 2 November agreed to reorganize the union into a two-
chamber legislative body. AP reported that the new body
will pass laws relevant only to the union and is not
intended to substitute for the two nations' own
legislatures. The upper chamber of the new body will
consist of legislators from the two countries, while the
members of the lower chamber will be elected directly by
voters in each country during national parliamentary
elections, according to ITAR-TASS. Twenty-five seats
will be reserved for Belarus and 75 for Russia. JAC

...WHICH YUGOSLAV NATIONALISTS CONSIDER JOINING.
Yugoslav Deputy Prime Minister Vojislav Seselj, who
attended the meeting, said that Yugoslavia wants to join
the union and that "the freedom of Slavic peoples can be
defended only by uniting." President of Belarus
Alyaksandr Lukashenka was also enthusiastic, saying that
Yugoslavia "has a favorable strategic situation and
climatic conditions" and "would do Belarus and Russia
much good from an economic and strategic point of view."
Meanwhile, Anatol Malafeyeu, chairman of Belarus's
Chamber of Representatives, expressed the hope that
Primakov's appointment as Russia's prime minister would
"deepen integration processes" between Russia and
Belarus. JAC

RUHRGAZ TO RESCUE? The price of Gazprom shares soared
more than 25 percent on the Moscow stock exchange
following the government's announcement of its
intentions to sell up to 5 percent of the company. The
tender will take place before the end of the year,
Deputy Prime Minister Vladimir Bulgak told Interfax on 2
November. Citing an anonymous source in the government,
the news agency reported that the government will sell
only 2.2 percent to 3 percent of Gazprom initially.
"Kommersant-Daily" on 3 November argued that the
government hopes that sale proceeds will help at least
partly to avoid a default on sovereign debt. The
newspaper added that although the devaluation of the
ruble lowered the company's price tag, the government
may be able to get $1 billion for a 3 percent stake
because now Ruhrgaz, in addition to Shell and ENI, is an
interested buyer. JAC

RUSSIA COMPLAINS ABOUT JAPANESE FISHING BOATS VIOLATING
BORDER. The Maritime Department of the Russian Border
Guards has said that recent violations of Russia's state
borders by Japanese fishing vessels are "a planned
action," Interfax reported on 2 November. On 30 October,
Russian border guards detained three fishing vessels off
the Kuril Islands but released them after the crews
promised to pay a $47,000 fine. Two days later, another
eight Japanese vessels entered the area without
informing the Russian border guards, thereby violating a
bilateral fishing agreement signed earlier this year.
The ships ignored border-guard radio signals, but the
guards took no action. Interfax quotes an unnamed
spokesman for the Maritime Department as saying the
violations were "aimed to check the reaction of Russian
border guards." BP

RUSSIAN SPACE MODULE READY FOR BLAST-OFF. Russian
engineers completed work on "Zarya," the first module of
the International Space Station on 2 November, ITAR-TASS
reported. "Zarya" is scheduled to be launched on 20
November. If all goes according to schedule, NASA will
launch a U.S.-built module in December. So far, however,
the schedule for the space station has experienced many
delays. JAC

RUSSIAN ARMY INVESTIGATING ITS OWN 'X FILES'. The
Defense Ministry houses a group of specialists studying
"paranormal phenomena," such as UFOs and occult
practices, "Novaya gazeta" reported on 26 October.
According to the journal, Major-General Aleksei Savin,
who heads the unit, founded the group in the late 1980s
at the behest of former General Staff Chief of Staff
Mikhail Moiseev. The unit reportedly conducts
experiments on humans, specifically military cadets. It
also won support from the highest levels of the Defense
Ministry, when some of its staff "predicted" the ascent
of Anatolii Kvashnin to Moiseev's position. JAC

LUZHKOV EXTENDING REACH TO CHESS CITY? The Republic of
Kalmykia has a new prime minister, Yurii Baturin, who
also heads the INTEK construction company, which
completed the building of Chess City in Kalmykia.
Earlier, the Russian press reported that Moscow Mayor
Yurii Luzhkov, who is Baturin's brother-in-law,
despatched Baturin to help President Kirsan Ilyumzhinov
finish Chess City when financing for the project dried
up in the wake of a scandal that followed the murder of
a journalist investigating official corruption in
Kalmykia. JAC

CHECHEN, INGUSH PRESIDENTS CRITICIZE BEREZOVSKII.
Interviewed in "Komsomolskaya pravda" on 3 November,
Aslan Maskhadov and Ruslan Aushev said CIS Executive
Secretary Boris Berezovskii's attempts to secure the
release of Russian presidential representative Valentin
Vlasov and other Russian hostages are counterproductive.
The two presidents criticized Berezovskii for
circumventing them and trying to negotiate Vlasov's
release directly with maverick field commander Salman
Raduev, whom, they said, Berezovskii has provided with
"more computers than some Russian intelligence services
possess." In negotiating directly with Raduev, Aushev
claimed, Berezovskii has driven up the ransom demanded
for Vlasov from $4 million to $7 million. Vlasov was
abducted on the Chechen-Ingush border on 1 May. Last
month, Berezovskii denied paying ransoms to secure the
release of hostages. Meanwhile, Chechen Deputy Security
Minister Nasrudi Bashiev has announced the arrest of two
persons suspected of kidnapping three Britons and a New
Zealander in Chechnya last month, AP reported on 2
November, citing Interfax. LF

TRANSCAUCASUS AND CENTRAL ASIA

GEORGIAN MUTINY LEADER DEMANDS PRESIDENT'S RESIGNATION.
Lieutenant Akaki Eliava, who led the abortive
insurrection in western Georgia on 19-20 October, has
demanded the release of all his supporters arrested for
their participation in the revolt, the resignation of
President Eduard Shevardnadze, and official condemnation
of the removal from power of former President Zviad
Gamsakhurdia in 1991-1992, Interfax reported on 2
November. Eliava threatened a new military campaign
against the Georgian authorities if those demands are
not met by 15 November. Thirty-four people have been
arrested to date for their role in the uprising, ITAR-
TASS reported on 2 November, quoting Military Prosecutor
Badri Bitsadze. LF

ARMENIAN PARLIAMENT DELEGATION VISITS GEORGIA. A
delegation headed by deputy parliamentary speaker Yurii
Bakhshian has concluded a three-day visit to Tbilisi,
where it held talks with Georgian parliamentary speaker
Zurab Zhvania and Minister of State Vazha Lortkipanidze,
Noyan Tapan reported. Zhvania stressed that the
dissatisfaction of the predominantly Armenian population
of the south Georgian region of Djavakheti must not be
exploited to undermine bilateral relations. The talks
also focused on ongoing cooperation in the energy and
transport sectors, including the Eurasian Transport and
Energy Corridors, and on drafting bilateral programs for
national security and cooperation with international
organizations. LF

ARMENIAN PARTY THREATENED WITH LIBEL SUIT. Several
prominent Armenian political figures have said they
intend to sue the Armenian Revolutionary Federation
(HHD) for libel, RFE/RL's Yerevan bureau reported on 2
November. The politicians, who include former national
security chief Davit Shahnazarian and Eduard Yegorian,
who heads the Hayrenik parliamentary group, are among
several associates of former President Levon Ter-
Petrossian whom the HHD has accused of corruption and
embezzlement (see "RFE/RL Newsline, 2 November 1998).
Senior HHD member Gegham Manukian said on 2 November
that his party has evidence to support its allegations
of malpractice. LF

AZERBAIJAN OPPOSITION PLANS NEW UMBRELLA MOVEMENT.
Representatives of more than 20 Azerbaijani political
parties and defeated presidential candidate Ashraf
Mehtiyev met on 2 November to discuss setting up a
Movement for Democracy, Turan and RFE/RL's Baku bureau
reported. The movement will campaign for new
parliamentary, presidential. and municipal elections.
Membership will be open to all those who do not
recognize the legitimacy of the present leadership. LF

AZERBAIJAN, TURKMENISTAN SEEK CASPIAN ACCORD.
Azerbaijani President Heidar Aliev will travel to
Ashgabat shortly with a government delegation for talks
with Turkmen officials on ownership of several Caspian
offshore oil fields to which both countries lay claim,
"Nezavisimaya gazeta" reported on 3 November. But
Turkmen Foreign Minister Boris Shikhmuradov has made
clear that Ashgabat will not compromise on the Kyapaz
field and will raise the possibility of becoming a
member of the international consortium currently
developing the Azeri and Chirag fields, according to
Turan on 2 November. LF

ALIEV SETS DEADLINE FOR MEP DECISION. Aliev on 1
November ordered the Azerbaijan State Oil Company SOCAR
and the Azerbaijan International Operating Company
(AIOC) to draw up by 12 November their recommendation on
the optimum route for the so-called Main Export Pipeline
for Caspian oil. Aliev again rejected claims that the
proposed Baku-Ceyhan route will cost up to $1 billion
more than the alternatives. In a 2 November interview
with Reuters, U.S. envoy for Caspian energy issues
Richard Morningstar similarly cast doubts on the
estimated cost of the Baku-Ceyhan route but made clear
that the U.S. government will not provide funds for that
project. Morningstar also said he does not consider it
"critical at this point" for the AIOC to make a firm
commitment to the Baku-Ceyhan route. He predicted
intensive negotiations between Azerbaijan, Turkey, and
the AIOC on how to fund the Baku-Ceyhan route. LF

TURKMEN OIL PRODUCTION REACHES RECORD LEVELS.
Turkmenistan's Oil and Gas Ministry on 2 November
announced that daily oil extraction has reached 20,000
tons, Interfax reported on 2 October. The ministry said
that improved extraction methods will "guarantee" a
total output of 7 million tons in 1998. That figure will
grow to 10 million tons by the year 2000, the ministry
said, adding that half of the total output will be
exported. BP

BOMB EXPLOSIONS IN TAJIK CITY. Several bombs exploded in
the southwestern city of Kurgan-Tyube on 3 November,
ITAR-TASS and Reuters reported. One bomb went off
outside the city's Interior Ministry building, killing
one person who was in a parked car nearby. Bombs also
exploded near other administrative buildings in the city
at intervals of 20 minutes, but no other casualties are
reported. Law enforcement officials describe the
explosions as acts of terrorism. BP

KYRGYZ NATIONAL CURRENCY LOSES VALUE AGAIN. Chairman of
the Kyrgyz National Bank Marat Sultanov told a news
conference on 2 November that the som is continuing to
lose value because foreign investors are withdrawing
money from the country, RFE/RL correspondents reported.
Sultanov said the Russian financial crisis is also
partly to blame for the decrease. Since July, the som
has dropped from 17 to $1 to 24-25. Sultanov said that
the National Bank has spent 12 percent of its hard
currency reserves since August. He added that the state
budget for 1999 will have to be revised. BP

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