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RFE/RL NEWSLINE

RFE/RL NEWSLINE Vol 3, No. 9, Part I, 14 January 1999


________________________________________________________
RFE/RL NEWSLINE Vol 3, No. 9, Part I, 14 January 1999

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

* RUSSIA STILL RILED ABOUT U.S. ACCUSATIONS

* TEACHERS' PROTESTS SPREAD THROUGHOUT COUNTRY

* KAZAKHSTAN TO HAVE NEW PRO-GOVERNMENT, OPPOSITION
PARTIES
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RUSSIA

RUSSIA STILL RILED ABOUT U.S. ACCUSATIONS... Russian
officials continued to express indignation at announced
U.S. sanctions against Russia for allegedly sharing
sensitive technology with Iran. Federal Security Service
(FSB) spokesman Aleksandr Zdanovich told ITAR-TASS on 14
January that U.S. intelligence services are wrong to
believe that the two institutes and one university
against which sanctions have been announced were
violating export technology controls. According to an
FSB statement, the current situation "is either the
result of a misunderstanding or the product of
insufficient work by American intelligence." The Russian
Foreign Ministry echoed the FSB's assertion that the
U.S. charges are unfounded and characterized the
administration's steps as "in flagrant contradiction of
understandings reached by the presidents of the two
countries in September 1998." Communist Party leader
Gennadii Zyuganov said that the U.S. believes itself to
be a "gendarme that has a right to dictate its will not
only to countries but even to separate educational
establishments, scientific establishments, and work
collectives." JAC

...AS NEW MEASURES THREATENED. The U.S. increased
pressure on Russia on 13 January by threatening to put
curbs on Russian space launches of US commercial
satellites if Russia does not stop cooperating with
Iran's nuclear and missile programs. U.S. State
Department spokesman James Rubin said that "if [the US]
does not get progress on the missile proliferation
problem," then Russia will not be able to launch any
more satellites, Reuters reported. Permission for 16
launches has already been granted, but those launches
are expected to be carried out early in 1999, requiring
Washington to complete a review of the program, which
has provided Russia with much-needed revenue. Russian
Foreign Ministry sources responded by saying that
"Russian-U.S. relations must be based on dialogue, not
on unilateral moves," Interfax reported the next day.
JAC

MASLYUKOV TO MEET WITH IMF... First Deputy Prime
Minister Yurii Maslyukov met with U.S. Deputy Secretary
of State Strobe Talbott on 13 January in Washington on
the first leg of a five-day U.S. visit. Maslyukov told
reporters before the meeting that U.S. sanctions and
Russian steel imports would likely top the discussion's
agenda. Maslyukov is scheduled to meet with IMF Managing
Director Michel Camdessus, World Bank president James
Wolfensohn and U.S. Commerce Secretary Bill Daley. He is
accompanied by First Deputy Finance Minister Oleg
Vyugin, Economics Minister Andrei Shapovalyants, and
Central Bank First Deputy Chairman Tatyana Paramonova,
according to ITAR-TASS. JAC

...AS DUMA TINKERS WITH BUDGET BACK HOME. Meanwhile in
Moscow, the State Duma's Budget Committee has approved a
number of amendments, redistributing some 7.9 billion
rubles ($350 million) among various budget items,
Interfax reported on 13 January. The committee suggested
that spending on international activities be cut by 4.3
billion rubles or 11 percent, while aid to regional
budgets be increased by 3.5 billion rubles or 9 percent.
JAC

RUSSIA IN DEFAULT ON SOVIET-ERA DEBT. The credit agency
Fitch IBCA on 13 January declared Russia's debt
inherited from the Soviet Union in default, downgrading
it from the level of CC to DD. The failure of
Vneshekonombank to make a $362 million interest payment
on 2 December prompted the decision, according to an
agency statement. Two days earlier, the Russian
government invited London Club creditors to hold talks
in the second half of January on payment of its Soviet-
era debts. On 19 January, creditors will vote whether to
demand immediate payment or give Russia more time to
settle its debts, Interfax reported. The debt, which
Russia accumulated after the Soviet Union broke up,
still carries a rating of CCC as do Russia's Eurobonds.
JAC

TEACHERS' PROTESTS SPREAD THROUGHOUT COUNTRY...
Teachers' actions have spread throughout Russia and are
expected to increase significantly on 27 January, the
date of an all-Russia teachers' protest action,
"Nezavisimaya gazeta" reported on 13 January. Noting
that more than 90 percent of education workers are
women, the newspaper reported that while the government
has no money to pay the teachers their full wages, the
problem has been exacerbated by the central and local
authorities' disrespectful treatment of the teachers.
For example, authorities in Novosibirsk tried offering
some teachers three bottles of vodka in lieu of their
wages. The daily concluded that the "humiliating
position in which teachers have been placed by
authorities is an indicator of the gangrene that is
eating the Russian state more powerfully every day." JAC

...AS ACTIONS TALLIED. According to data released by an
educational workers' union, as of 11 January teachers at
almost 1,400 schools across nine Russian regions were on
strike, "Vremya MN" reported on 12 January. Those
regions are the republics of Altai, Khakassia, and
Buryatia; the oblasts of Kurgan, Novosibirsk, Smolensk,
Irkutsk, and Magadan; and Krasnoyarsk Krai. Teachers at
181 schools in Vologda Oblast and at six schools in
Vladimir Oblast are also on strike, Russian agencies
reported. JAC

TOP FINANCE MINISTRY OFFICIAL RESIGNS. First Deputy
Finance Minister Aleksei Kudrin tendered his resignation
on 14 January, Prime-TASS reported. Prime Minister
Primakov has accepted his resignation. Kudrin will not
leave government service and will work at a state
agency, according to Interfax the previous day. JAC

VLADIVOSTOK ELECTIONS TO TAKE PLACE ON SCHEDULE? Deputy
chief of the presidential administration Oleg Sysuev
pledged on 13 January that "the president of Russia
personally and the presidential administration will do
everything possible to make sure that the [Vladivostok
mayoral] elections scheduled for 17 January take place,"
ITAR-TASS reported. A district court had earlier ruled
that the elections would be illegal, and although local
officials intended to lodge an appeal, they said the
elections would not take place as scheduled (see "RFE/RL
Newsline," 11 January 1999). Sysuev said that the
"cancellation of mayoral elections and all this
unhealthy fuss around them benefit those who do not want
law and order to be restored." According to Interfax, he
is slated to become head of a new department in the
presidential administration on regional policies and
local self-government (see "RFE/RL Newsline," 13 January
1999). JAC

NEW FOREIGN INVESTMENT LAW IN PIPELINE. The Russian
government is preparing a new version of the law on
foreign investments, Deputy Economic Minister Vladimir
Kossov told Interfax on 13 January. The law contains a
provision that the government will protect investors
from adverse changes in investment terms for the first
seven years of a project. The bill, according to Kossov,
"virtually renounces the nationalization of foreign
property" and provides fair compensation in those rare
cases in which nationalization is necessary for national
security reasons. JAC

LEBED TO SEEK POWER REDISTRIBUTION BETWEEN CENTER,
REGIONS... Krasnoyarsk Krai Governor Aleksandr Lebed
told ITAR-TASS on 14 January that he will push for a
"redistribution of relations between the center and
regions" at a meeting of the Siberian Accord
organization on 15 January. According to Lebed, Moscow
still tries to run everything long-distance. As an
example, he cited the Krasnoyarskugol association, whose
coal reserves and electric power stations are located in
Siberia but are "managed from the Arbat." On the other
hand, he noted that the 1999 budget shows the federation
"has been increasingly shifting more responsibilities to
regions without backing them financially." Deputy chief
of the presidential administration Sysuev is planning to
represent the government's position at the upcoming
meeting. JAC

...WARNS OF NEW NORTH CAUCASUS CONFLICT. In a statement
summarized by Interfax on 13 January, Lebed, who is also
former Russian Security Council secretary, warned that
unless Moscow takes swift action in support of Chechen
President Aslan Maskhadov, a new war may erupt in the
North Caucasus. He argued that Russia has ceded its
strategic interests in Chechnya to the U.S., Turkey,
Pakistan, and Saudi Arabia. Forces opposed to Maskhadov
are "ready to start an armed insurgency at any moment,"
he argued. Lebed also blamed Moscow for not having taken
advantage of the opportunity offered by the peace
agreement that he and Maskhadov signed in late August
1996 to stabilize the political and economic situation
in Chechnya and the neighboring North Caucasus
republics. In July, Lebed and three other leading
Russian politicians called on the Russian government to
take measures to stabilize the deteriorating situation
in the North Caucasus (see "RFE/RL Newsline," 28 July
1998). LF

GOVERNMENT ASKS KALMYKIA TO PAY UP. The republic of
Kalmykia will not receive funds from the federal budget
until it pays its 236 million ruble ($10.5 million) debt
to the center, First Deputy Finance Minister Viktor
Khristenko told reporters on 12 January. According to
Khristenko, Kalmykia suggested transferring outstanding
taxes to the center twice a year in a fixed sum. But
Khristenko argued that such a scheme would lead to
regional separatism and is therefore unacceptable. JAC

CENTRAL BANK BAILS OUT PROMSTROIBANK. The Central Bank
has granted a 1.5 billion ruble ($66 million)
stabilization loan to Promstroibank, Interfax reported
on 13 January, citing "sources close to banking
circles." In exchange the Central Bank has received a 75
percent stake in the company. JAC

RUSSIA TO STUDY WOMEN IN SPACE. Yelena Kondrakova, the
third Russian female cosmonaut, will participate in a
simulated space flight on a model space station on
earth, ITAR-TASS reported on 13 January. According to
the agency, data need to be gathered on how women would
participate in an international space crew. Two other
women from the U.S. and Canada and several men will also
take part in the simulated flight. The team will be
divided into four crews that will live on a model
international space station consisting of two modules
measuring 200 and 100 cubic meters that have only
computer and radio contacts with the outside world. JAC

TRANSCAUCASUS AND CENTRAL ASIA

KAZAKHSTAN TO HAVE NEW PRO-GOVERNMENT, OPPOSITION
PARTIES. Former Prime Minister Sergei Tereshchenko, who
headed President Nursultan Nazarbayev's recent
successful campaign for re-election, told journalists on
13 January that his campaign team intends to create a
new political party, called Otan [Fatherland], which
Nazarbayev will be invited to head, Reuters reported.
Tereshchenko said the new party will adhere to
"democratic and parliamentarian principles" and will
contend the local and parliamentary elections later this
year. The new group will propose Nazarbayev as its
candidate for the presidential elections in 2006, he
added, according to Interfax. Also on 13 January, Hasen
Qozhakhmet, one of the leaders of the opposition AZAT
movement, told journalists in Almaty that he intends to
found a new political party called Otanshildar [Lovers
of the Fatherland], which will unite patriots and
intellectuals, RFE/RL's Almaty bureau reported the
following day. LF

KYRGYZ PREMIER MEETS WITH PRIMAKOV, LUZHKOV... Jumabek
Ibraimov held separate talks with Russian Prime Minister
Yevgenii Primakov and Moscow Mayor Yurii Luzhkov in
Moscow on 13 January, RFE/RL's Bishkek bureau reported.
Ibraimov and Primakov focused on the prospects for
expanding bilateral economic cooperation and on
rescheduling Kyrgyzstan's $132 million debt to Moscow.
Primakov characterized bilateral relations as "warm and
friendly" and expressed confidence that the "few
outstanding problems" can be resolved. (Ibraimov told
Interfax on 11 January that Moscow had failed to deliver
on earlier promises of industrial and technological
cooperation.) Ibraimov said after his talks with the
Russian premier that he does not exclude the possibility
of Kyrgyzstan concluding an economic and political
alliance with Russia, but he added that he did not
discuss that possibility with Primakov, Interfax
reported. LF

...AND SERGEEV. Meeting with Ibraimov and his Kyrgyz
Defense Minister Murzakan Subanov the previous day,
Russian Defense Minister Igor Sergeev described
bilateral military cooperation as "long-term and
stable." He said that Russia will continue to render
military assistance to Kyrgyzstan and that the two
countries will sign a military cooperation agreement
later this year, ITAR-TASS reported. LF

FAMINE IMMINENT IN EASTERN TAJIKISTAN? The Gorno-
Badakhshan Autonomous Oblast, eastern Tajikistan, may
soon face a famine as a result of the significantly
reduced deliveries of humanitarian aid in recent months,
"Nezavisimaya gazeta" reported on 14 January. The
population of the region, one of the poorest in the
entire former USSR, is Ismaili and has relied heavily on
humanitarian aid from the Aga Khan's foundation and
international agencies. LF

TAJIK BORDER GUARDS RELEASED. Three Tajik border guards
taken hostage on 10 January after an armed clash with an
Afghan border patrol were released on 13 January, ITAR
TASS reported (see "RFE/RL Newsline," 12 January 1999).
LF

UZBEKISTAN HALTS BBC MEDIUM-WAVE TRANSMISSIONS. A BBC
editor told Reuters in Tashkent on 13 January that the
Uzbek government has curtailed BBC medium-wave
broadcasts in Uzbek, Russian, and English, switching
those programs to a waveband inaccessible to many
listeners. The BBC continues to broadcast on short-wave
to Uzbekistan. LF

UZBEKISTAN UPGRADES RAIL LINKS. The Asian Development
Bank will extend a $120 million loan to Uzbekistan to
upgrade its rail system, Interfax reported on 13
January. A recent session of the Uzbek-Chinese
intergovernmental commission in Beijing also discussed
the expansion of rail links between the two countries.
LF

ARMENIA CONCERNED THAT OSCE MAY AMEND KARABAKH PEACE
PLAN. Armenian Foreign Minister Vartan Oskanian,
speaking to journalists in Yerevan on 13 January, urged
that the U.S, French, and Russian co-chairmen of the
OSCE Minsk Group not to amend their latest draft
Karabakh peace plan to accommodate Azerbaijan's
objections, RFE/RL's Yerevan bureau reported. The
Azerbaijani leadership has rejected that plan, which
advocates the creation of a "common state" composed of
Azerbaijan and the unrecognized Nagorno-Karabakh
Republic (see "RFE/RL Newsline," 23 November 1998).
Oskanian said he has conveyed his concerns to the
Russian and U.S. co-chairmen in recent meetings. He also
expressed concern that Azerbaijan and Turkey might
conclude a defense agreement, which he said would
undermine stability in the region, according to
Interfax. Turkish media have quoted Azerbaijani
Presidential adviser Vafa Guluzade as advocating such a
pact (see "RFE/RL Newsline," 6 and 8 January 1999). LF

ARMENIAN DASHNAKS ANNOUNCED PLANNED COOPERATION WITH
LUZHKOV'S OTECHESTVO. Leaders of the Armenian
Revolutionary Federation--Dashnaktsutiun (HHD) told
journalists in Yerevan on 13 January that the party
reached an agreement on "comprehensive cooperation" with
Moscow Mayor Luzhkov's Otechestvo [Fatherland] political
alliance during talks in Moscow last month, RFE/RL's
Yerevan bureau reported. Dashnak presidential adviser
Vahan Hovannisian said the HHD and Otechestvo have the
same "social democratic" ideology, and he praised
Luzhkov for what he termed his rejection of "inter-
ethnic hatred in Russia." He said his party will help
Otechestvo become a member of the Socialist
International, which the Dashnaks joined in 1907. LF

RUSSIA WELCOMES ABKHAZ REPATRIATION OFFER. The Russian
Foreign Ministry has issued a statement expressing
cautious approval of Abkhaz President Vladislav
Ardzinba's unilateral offer to permit Georgian displaced
persons to return to Abkhazia's southernmost Gali Raion
beginning 1 March, Interfax reported on 13 January. But
the statement also queried whether such repatriation is
feasible without the agreement of the Georgian
leadership and the overall stabilization of the region.
Georgian leaders have dismissed Ardzinba's offer as
populism (see "RFE/RL Newsline," 13 January 1999). LF

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