RFE/RL NEWSLINE Vol 2, No. 243, Part I, 18 December 1998

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RFE/RL NEWSLINE Vol 2, No. 243, Part I, 18 December 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

* KREMLIN CONDEMNS NOT ONLY U.S. BUT ALSO NATO

* DUMA PASSES MORE PSA LEGISLATION

* NAZARBAYEV SAYS IT'S HIS "DUTY" TO ENSURE FAIR
ELECTIONS
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RUSSIA

KREMLIN CONDEMNS NOT ONLY U.S. BUT ALSO NATO... Russian
leaders continued to call for an end to air strikes
against Iraq and used the Iraq attack as a new pretext
to criticize NATO. Both President Boris Yeltsin and
Prime Minister Yevgenii Primakov called for an immediate
end to military action. Primakov also called the action
against Iraq "intolerable" and "outrageous," while AFP
reported that Russian Foreign Minister Igor Ivanov
demanded the dismissal of UN weapons inspector Richard
Butler, whom he and the majority of Russian newspapers
blame personally for the attack on Iraq. Defense
Minister Igor Sergeev said that Russia should ask itself
what use is Russia's relationship to NATO, if NATO
members simply ignore its views. Sergei Kislyak,
Russia's permanent envoy to NATO, added that although
NATO itself is not involved in the attack, two of its
members are. He added that Russian policymakers are
concerned about what kind of precedent is being set. JAC

...AS DUMA RECOMMENDS HIGHER DEFENSE SPENDING. Meanwhile
in the State Duma, rhetoric was even harsher. Communist
Party leader Gennadii Zyuganov called the strikes "an
act of terror" and "an extreme manifestation of
international gangsterism," while Liberal Democratic
Party of Russia (LDPR) leader Vladimir Zhirinovsky
called the U.S. "a bandit state that staged a barbarous
act." Deputies adopted a resolution condemning the air
strikes and calling for an increase in defense spending.
They also recommended that the government review
Russia's current and future relations with the U.S.,
Britain, and NATO as well as end Russian compliance with
UN sanctions against Iraq. On 18 December, Russia
recalled its ambassadors to the U.S. and Britain to
Moscow for consultations. JAC

START-II RATIFICATION SWITCHES TO INDEFINITE HOLD. The
years-long delay of START-II ratification is likely to
be extended for at least another six months, according
to various Russian politicians. Presidential spokesman
Dmitrii Yakushkin told reporters on 18 December that
chances for ratification have "really faded." A
spokesman for First Deputy Prime Minister Yurii
Maslyukov, who had been one of the treaty's most vocal
advocates in Primakov's government, said that although
the treaty should still be ratified, it would be
inappropriate to do so while air strikes are occurring.
JAC

STRIKES AT IRAQ A BLOW TO RUSSIA'S WORLD POWER STATUS?
Influential businessman Boris Berezovskii told Interfax
that with the onset of the air strikes, "Russia joined a
number of countries that don't have to be reckoned
with." One of Berezovskii's arch foes, Zyuganov, agreed,
saying that the U.S. does not reckon with Russia as a
major nation. Ingushetian President Ruslan Aushev echoed
the general sentiment, concluding that the "United
States has once again showed who is the master in the
world, while Russia showed its weakness." JAC

DUMA PASSES MORE PSA LEGISLATION. After a two-year
delay, the State Duma passed in the second reading a
package of amendments to the production sharing
agreement (PSA) law on 17 December. The vote was 342 in
favor and 12 opposed. The amendments will bring 12
federal laws into compliance with the PSA law and are
expected to give new impetus to foreign investment in
Russia's oil sector, which has been languishing in part
because of unfavorable tax treatment. Last week, the
Duma passed another set of amendments to the PSA law in
what was widely perceived to be a breakthrough in a long
legislative stalemate (see "RFE/RL Newsline," 10
December 1998). President Yeltsin is expected to approve
both bills. JAC

NEW ROUND OF DEBT TALKS PROMISES TO BE TENSE. Russian
government officials and international bank
representatives on 17 December began a new round of
talks on the terms for resettling debt from the
government's defaulted short-term treasury bonds (GKOs).
In an interview with the "Financial Times," Finance
Minister Mikhail Zadornov said "only technical issues"
remain to be resolved. However, discussion of these
"technical issues" promises to be heated, since the
first item on the bankers' long agenda for their talks
is their contention that the government is trying to set
terms unilaterally, according to Reuters. MFK
Renaissance wrote in one of its reports that the
"concerns of foreign holders of GKOs have now been
placed a long way down the list of priorities," after
the budget and restructuring of foreign debt, the
"Moscow Times" reported on 18 December. The government
announced earlier that it will reimburse only 5 percent
of the its defaulted debt in cash--half the amount
previously pledged. JAC

LUKASHENKA WINDS UP RUSSIAN TRIP... Belarusian
Alyaksandr Lukashenka finished a two-day trip to Russia
on 17 December after meetings with Prime Minister
Primakov, Central Bank Chairman Viktor Gerashchenko, and
President Yeltsin. Lukashenka told reporters that a
"concrete decision" on whether Belarus will switch to a
common or a single currency with Russia will be reached
soon. According to Lukashenka, Gerashchenko supports the
introduction of a common currency, such as the so-called
"transfer ruble," which would then be followed by a
single currency. Lukashenka also promised that in the
near future Russia and Belarus would sign an agreement
offering businesses in both countries equal economic
conditions, such as the right to pay the same railway
tariffs. On 17 December, Primakov and Belarusian Prime
Minister Syarhey Linh signed an agreement establishing a
new method of paying for Russian gas with foodstuff from
Belarus. JAC

...AND COMMENTS ON ANTI-SEMITISM... Asked about the
increasing controversy over anti-Semitism in Russia,
Lukashenka echoed the official response of Russia's
Communist Party. He told Mayak Radio on 16 December that
"the problem of anti-Semitism has been engendered by
Jews themselves, the ones who work for mass media." He
added that he "would not allow the mass media to fan up
these problems the way it is being done in your
country." JAC

...WHILE FINANCE MINISTER SAYS BELARUS CAN TAKE RUBLE OR
LEAVE IT. Finance Minister Zadornov told Ekho Moskvy
that idea of a transferable ruble is a non-starter and
that the only way Belarus could unite its currency with
Russia would be to adopt the Russian ruble, Russian tax
legislation, and the monetary policies followed by the
Russian Central Bank. Lukashenka did not meet with
Zadornov during his visit. "Nezavisimaya gazeta" argued
that although the idea of a union between the two
countries is supported by public opinion as well as the
new Russian government, "it is no longer possible to
speak for certain of the possibility of closer
unification" because "the Belarusians and Russians hold
very different opinions of the conditions for such
unification." JAC

ZHIRINOVSKY TO RUN FOR GOVERNOR OF SVERDLOVSK? LDPR
leader Zhirinovsky announced that he will compete in the
August 1999 gubernatorial elections in Sverdlovsk
Oblast, according to "EWI Russian Regional Report" on 17
December. According to the report, the LDPR's popularity
in the oblast is growing and a number of mayors in small
towns and several enterprise heads have joined the
party. Earlier, Zhirinovsky announced his plans to run
for governor of Leningrad Oblast, a move that spurred
slain Duma deputy Galina Starovoitova to enter the race
(see "RFE/RL Newsline," 28 September 1998). However,
those elections have been postponed. According to the
report, Zhirinovsky will launch his campaign at the LDPR
conference on 19 December. JAC

ORPHANAGES VIOLATING HUMAN RIGHTS ROUTINELY. Tens of
thousands of Russian children abandoned by their parents
live in orphanages where conditions can be prison-like
or worse, Human Rights Watch revealed in a report
released on 16 December. According to the report, at
least 30,000 children in orphanages for the severely
disabled are treated in violation of UN covenants and
international human rights; some never learn to walk and
are confined to bed or tied to furniture. Children
deemed normal are often kept in dark rooms or sedated
without medical supervision. About 40 percent of the
15,000 children released from orphanages annually become
homeless, according to data released by the Prosecutor-
General's Office, AP reported. About 40 percent commit
crimes, 30 percent become alcoholics or drug addicts,
while 10 percent commit suicide. JAC

PRESS HARRASSMENT IN KALMYKIA CONTINUES. Kalmykian
authorities are continuing to harass the editors and
publishers of the opposition newspaper "Sovetskaya
Kalmykia Segodnya," according to "Nezavisimaya gazeta"
on 16 December. Gennadii Yudin detailed the government's
efforts to curb the newspaper at a Moscow news
conference. Yudin became the newspaper's editor after
the former editor in chief, his wife, Larisa Yudina, was
killed under mysterious circumstances six months ago
(see "RFE/RL Newsline," 9 June and 26 August 1998). JAC

CHECHENS CALL ON PRESIDENT TO NEUTRALIZE OPPONENTS.
Participants in a mass demonstration in Grozny on 17
December called on Aslan Maskhadov to expel from
Chechnya foreign armed groups, crack down on criminal
gangs, and neutralize field commander Arbi Baraev and
his men without resorting to force, Interfax reported.
They also said Maskhadov should rein in his radical
Islamist deputy, Vakha Arsanov, if necessary by
abolishing the post of vice president. Addressing the
demonstrators, Deputy Prime Minister Turpal Atgeriev
said the deteriorating situation in Chechnya was to be
blamed on defeated presidential candidates Shamil Basaev
and Zelimkhan Yandarbiev, whom he accused of supporting
criminal elements. Atgeriev added that a coup is being
prepared in Chechnya but he did not say by whom,
according to Interfax. Speaking on Chechen Television on
17 December, Maskhadov vowed to liquidate all illegal
armed formations by exclusively legal means, without
resorting to large-scale combat operations, ITAR-TASS
reported. LF

TRANSCAUCASUS AND CENTRAL ASIA

SOME CIS CENTRAL ASIAN STATES CRITICIZE ATTACKS ON
IRAQ... Kazakhstan's Foreign Ministry issued a statement
on 17 December expressing "deep regret and concern" over
the U.S. and British missile attacks on Iraq, ITAR-TASS
reported. That view was shared by the Kyrgyz Foreign
Ministry, while the country's Muftiat roundly condemned
the attack, which is taking place in the month that is
"sacred to all Muslims," alluding to the start of
Ramadan at sunset on 19 December. The Tajik Foreign
Ministry said the next day that it is "alarmed" by the
strikes and that it hopes military action will cease
immediately. BP

...WHILE OTHERS EXPRESS UNDERSTANDING, SUPPORT. Richard
Morningstar, the U.S. presidential adviser on energy in
the Caspian region, said at a press conference in
Ashgabat, on 17 December, that Turkmen President
Saparmurat Niyazov "expressed understanding for the
reasons behind U.S. bombing of Iraq," Interfax reported.
Uzbek President Islam Karimov said the next day that
"what occurred in the Persian Gulf was to be expected."
Karimov added, however, that it was "a pity" the attacks
were launched without the UN's sanction," ITAR-TASS
reported. BP

ARMENIA, GEORGIA RESPOND TO IRAQI BOMBINGS. Armenian
Foreign Minister Vartan Oskanian told journalists in
Yerevan on 17 December that the U.S. and British air
strikes against Iraq "are of serious concern to the
Armenian government," RFE/RL's Yerevan bureau reported.
"We hope that the bombardment will be halted very
quickly and the problem will be solved by diplomatic
means," he said. In Tbilisi, Georgian President Eduard
Shevardnadze called for an immediate meeting of the UN
Security Council "to ensure the unconditional
fulfillment of [the council's] resolutions," ITAR-TASS
reported. Shevardnadze said that events in Abkhazia
testify to the "tragic consequences" of non-fulfillment
of UN Security Council resolutions. LF

U.S. PROMISES FINANCIAL SUPPORT FOR TURKMEN PIPELINES.
Morningstar, the U.S. presidential adviser on energy in
the Caspian region, said in Ashgabat that the U.S. Exim
Bank and the Overseas Private Investment Corporation are
prepared to finance the Transcaspian gas pipeline and
insure it against "political risk," ITAR-TASS reported.
Morningstar said many U.S. companies have come forward
with proposals for the project. He said much depended on
creating an "atmosphere of mutual trust," which is why
the U.S. is ready to act as a "mediator" between
Turkmenistan and Azerbaijan in their dispute over
sectors s of the Caspian Sea. Morningstar said he
received promises of support for the project from
Azerbaijani leaders when he visited Baku on 16 December
(see "RFE/RL Newsline," 17 December 1998). BP

NAZARBAYEV SAYS IT'S HIS "DUTY" TO ENSURE FAIR
ELECTIONS. Kazakh President Nursultan Nazarbayev said in
a statement released in Astana on 17 December that it is
"my duty to draw the attention of all state power
structures...to the need to avert any illegal
interference with the election process and create equal
conditions for all candidates" during the campaign for
the 10 January presidential elections, "Nezavisimaya
gazeta" reported. Nazarbayev continued that "some
insignificant irregularities, not affecting the election
campaign as a whole, have been reported." He added that
"any officials standing in the way of presidential
candidates, electoral commissions, observers or
electoral headquarters, will be held accountable." BP

CASPIAN LITTORAL STATES FAIL TO REACH AGREEMENT. Meeting
in Moscow on 16-17 December, deputy foreign ministers of
Russia, Iran, Azerbaijan, Kazakhstan, and Kyrgyzstan
narrowed but failed to resolve their disagreement over
how to divide the sea into national sectors, Reuters and
Interfax reported. Russia and Kazakhstan continue to
advocate dividing the seabed into national sectors,
leaving the waters for common use. Azerbaijan and
Turkmenistan want to divide both the seabed and the
waters into such sectors. Iran signaled at the meeting
that it might agree to that approach, which it had
previously rejected, but only on condition that all
national sectors of the sea are of equal size. Under the
present delineation, the national sectors vary in size.
A third meeting of the deputy foreign ministers' working
group will be held in May in Tehran. LF

ARMENIA REAFFIRMS COMMITMENT TO MEDZAMOR CLOSURE.
Speaking in Yerevan on 17 December following the annual
meeting of the EU-Armenia commission, Armenian Foreign
Minister Oskanian said Armenia will abide by its
commitment to shut down the Medzamor nuclear power plant
by 2004, RFE/RL's Yerevan bureau reported. An EU
statement said the two sides will create a working group
to study the prospects for developing alternative
sources of energy. Medzamor currently generates some 35
percent of Armenia's electricity. EU officials announced
some ECU 50 million ($58.8 million) in new grants and
loans to Armenia, raising the total amount of EU aid to
Armenia since 1991 to more than ECU 250 million. LF

TALKS ON ABKHAZ CONFLICT OPEN IN GENEVA. Liviu Bota, UN
Secretary-General Kofi Annan's special envoy to Georgia,
told journalists in Geneva on 17 December that the
security situation in Abkhazia is "rapidly
deteriorating," Reuters reported. Bota said that the
incidence of terrorist activities is increasing and
rumors are circulating of a possible resumption of
hostilities (see "RFE/RL Caucasus Report," Vol. 1, No.
42, 16 December 1998). Georgian Minister of State Vazha
Lortkipanidze and Abkhaz Premier Sergei Bagapsh began
two days of behind-closed-doors talks on 17 December
that will focus primarily on the repatriation to
Abkhazia of ethnic Georgian displaced persons, which
Bota termed "a humanitarian priority." U.S., French,
British, German, Russian, and OSCE representatives are
also present at those talks. LF

SUPPORTERS OF DECEASED GEORGIAN PRESIDENT ARRESTED.
Several hundred police rounded up supporters of former
President Zviad Gamsakhurdia who were staging an
unsanctioned protest demonstration on 17 December
outside the parliament building in Tbilisi, Caucasus
Press reported. The demonstrators were demanding that
the building be turned over to what they called the
legitimate Georgian parliament elected in November 1990.
Gamsakhurdoia's supporters had a clear majority in that
parliament. Most of the demonstrators were transported
several kilometers outside Tbilisi and then released. LF

AZERBAIJAN, TURKEY TO FUND BAKU-CEYHAN PIPELINE?
Addressing members of the youth organization of the
ruling Yeni Azerbaycan party on 17 December, Ilham
Aliev, son of the Azerbaijani president, said that
Azerbaijan and Turkey may jointly fund construction of
the proposed Baku-Ceyhan pipeline for Azerbaijan's
Caspian oil if the Azerbaijan International Operating
Company (AIOC) which is engaged in extracting that oil,
declines to do so, Turan reported. The AIOC has
repeatedly postponed making a firm commitment to the
pipeline, saying the estimated cost of $3.5 billion is
not viable. Ilham Aliev also denied categorically that
he will accept the post of chairman of the Yeni
Azerbaycan party. LF

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