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RFE/RL NEWSLINE Vol 3, No. 20, Part II, 29 January 1999
________________________________________________________ RFE/RL NEWSLINE Vol 3, No. 20, Part II, 29 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 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 xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx Headlines, Part II * POLISH GOVERNMENT YIELDS TO FARMERS' DEMANDS * SLOVAK GOVERNMENT APPROVES REFORM PLAN * CONTACT GROUP PREPARES ULTIMATUM End Note: THE CORRUPTION INVESTIGATION INTO LAZARENKO xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx EAST-CENTRAL EUROPE UKRAINE'S MEMBERSHIP IN COUNCIL OF EUROPE'S ASSEMBLY THREATENED. The Parliamentary Assembly of the Council of Europe has said it will suspend Ukraine's membership unless it "takes steps toward meeting its commitments," Reuters and Ukrainian Television reported on 28 January. Two days earlier, the assembly had threatened to suspend Ukraine unless it fully meets its commitments before the June 1999 PACE session. It has criticized Ukraine primarily for failing to abolish the death penalty. Under a presidential moratorium, there have been no executions in Ukraine since March 1997, although courts continue to pass death sentences. The assembly is demanding that Ukrainian lawmakers adopt the moratorium as law. But lawmakers are resisting such a move, arguing that up to 80 percent of the population are opposed to banning the death penalty. JM UKRAINE 'DISAPPOINTED' BY NON-RATIFICATION OF TREATY WITH RUSSIA. The Ukrainian Foreign Ministry on 28 January issued a statement saying that Kyiv is "disappointed" by the decision of Russia's Federation Council to postpone the ratification of the Ukrainian- Russian Treaty (see "RFE/RL Newsline," 28 January 1999). The ministry argued that the treaty is an "indicator" of good-neighborly and equal relations. It added that it hopes the Federation Council will ratify the treaty "in the near future." JM KUCHMA CONTINUES RESHUFFLING CABINET. Ukrainian President Leonid Kuchma has appointed Andriy Honcharuk as minister for foreign economic relations and Raisa Bohatyryova as health minister. Until now, both served as deputy ministers. The appointments follow a cabinet shakeup earlier this month in which Kuchma fired First Deputy Prime Minister Anatoliy Holubchenko, three ministers, and four deputy ministers. Holubchenko on 28 January was appointed first deputy chairman of the State Property Fund, a government agency dealing with privatization of state assets. JM TKACHENKO SAYS UKRAINE MAY JOIN BELARUS-RUSSIA UNION. Ukrainian parliamentary speaker Oleksandr Tkachenko met with Belarusian President Alyaksandr Lukashenka in Minsk on 28 January and addressed the Chamber of Representatives, the lower legislative house. "Belarus serves as an example of how to preserve the best of what [previously existed]...and exerted positive influence on [Belarus's] development," Interfax quoted Tkachenko as saying. Tkachenko told journalists later that Ukraine may soon join the Belarusian-Russian union. He added that in the meantime the three Slavic states must build common economic and customs systems. JM BELARUS PLANS 1999 BUDGET DEFICIT AT 1.8 PERCENT. The Chamber of Representatives on 28 January adopted Belarus's 1999 draft budget in the first reading, Belapan reported. The budget deficit is planned at 1.8 percent of GDP. The government will use primarily domestic sources to finance the deficit, in particular National Bank loans and revenues from treasury bills. Budget revenues total 416 trillion Belarusian rubles ($3.1 billion, according to the official exchange rate). GDP is predicted to grow by 3-5 percent. Finance Minister Mikalay Korbut told the legislature that annual inflation is expected to reach 190-205 percent, while the average U.S. dollar exchange rate is forecast at 230,000 Belarusian rubles. JM ESTONIAN PARLIAMENT REJECTS EESTI TELEKOM BILL. Lawmakers on 28 January voted by 24 to 14 in favor of removing from the agenda a bill urging that privatization plans for Eesti Telekom be revised, ETA reported. The draft law would have classified Eesti Telekom as a strategic company, meaning that the state would have retained a 51 percent share. Under the current plans, the state will have a 27.3 percent stake and the Finnish and Swedish concerns Sonera and Telia 49 percent, while the remaining 23.7 percent of shares are currently on offer to private investors (see "RFE/RL Newsline," 25 and 27 January 1999). JC ESTONIAN PREMIER CONFIRMS INTERIOR MINISTER'S RESIGNATION. Mart Siimann on 28 January confirmed that Interior Minister Olari Taal handed in his resignation 10 days earlier, ETA reported. Both have declined to comment on the reasons for the resignation, but according to press reports, the two men are engaged in a dispute over the appointment of a new chancellor to the Interior Ministry. JC LATVIA'S 1999 BUDGET PASSES IN FIRST READING. Lawmakers have voted by 56 to 37 with no abstentions to pass this year's draft budget in the first reading, LETA reported on 28 January. The Social Democrats, who earlier had opposed the bill's provision for defense expenditures equaling 0.9 percent of GDP, all voted in favor, with the exception of one member of the party's caucus, "Diena" reported the next day. The "no" votes were cast by the rightist People's Party of former Premier Andris Skele and the leftist bloc For Human Rights in a United Latvia. Under Latvian law, the budget is subject to two readings only. The parliament also approved Raimonds Graube as commander of the national armed forces. He replaces Juris Eihmanis, who was fired last fall over a housing scandal. JC LITHUANIAN PREMIER DECLARES WAR ON ORGANIZED CRIME. Gediminas Vagnorius has declared war on organized criminal groups in the wake of the murder earlier this week of the chief prosecutor in the northern town of Panevezys (see "RFE/RL Newsline," 27 January 1999), ELTA and BNS reported on 29 January. Vagnorius told journalists that beginning this year, special task forces will be set up within organized crime investigation departments. He noted that the government will boost efforts to pass laws making it easier to arrest and convict organized crime bosses. And he promised that government spending on law enforcement will be increased. JC NATO LEADER APPLAUDS LITHUANIAN DEFENSE BUDGET. Receiving Lithuanian President Valdas Adamkus at NATO headquarters in Brussels, Supreme Commander of Allied Forces in Europe General Wesley Clark praised a law recently passed by the Lithuanian parliament providing for defense expenditures to total 1.95-2 percent of GDP by 2001 (see "RFE/RL Newsline," 11 and 15 January 1999). ELTA reported that Clark was "optimistic" about Lithuania's chances of gaining entry to NATO, while pointing to the need to raise professional standards among Lithuanian officers and step up cooperation with NATO units. JC POLISH GOVERNMENT YIELDS TO FARMERS' DEMANDS. Agricultural Minister Jacek Janiszewski on 28 January announced that the cabinet next week will introduce intervention prices for Polish pork at 2.8 zlotys ($0.78) per kilogram, up from 1.8 zlotys, Polish media reported. In a related move, Finance Minister Leszek Balcerowicz asked the parliament's upper house to amend the 1999 budget to allocate 275 million zlotys to the State Agency for Agricultural Market to subsidize those purchases. Yielding still further to the demands of the farmers (see "RFE/RL Newsline," 28 January 1999), the government held talks with radical farmers' leader Andrzej Lepper. Lepper told journalists later that the government is not prepared to meet his demands, and he threatened to continue blocking roads until the government complies. In addition to higher prices for agricultural produce, Lepper demands that the authorities renounce their intention to punish farmers for erecting road blockades. JM CZECH CATHOLIC CHURCH REFUSES TO SIT ON COMMISSION WITH COMMUNIST. The Czech Catholic Church on 28 January said it will not participate in a government commission on Church-state relations because of Communist Party participation in that body, CTK reported. Daniel Herman, the spokesman for the Catholic Church's Czech Bishops' Conference, said it decided unanimously not to take part because of the "participation of Communists." Communist deputy Dalibor Matulka was named to the commission by the Social Democratic government earlier that day. Herman said it is "impossible" to hold talks with a party "which is a criminal organization in its essence and which bears full responsibility for one of the most brutal forms of persecution of Churches and religious organizations in Europe in the 20th century." He said the Catholics will discuss the composition of the commission with the government in the next few days. PB CZECH REPUBLIC READY FOR EU BY 2003? Czech Foreign Minister Jan Kavan said at a meeting in London with his British counterpart, Robin Cook, that the Czech Republic will fulfill EU entry criteria by 2003, CTK reported on 28 January. Kavan said he and Cook also discussed the Kosova crisis and the Charter of Basic Rights in Europe. The previous day, in an interview with the "Prager Zeitung," Kavan said that Czech-German relations are "very good" and "better than ever before." He said the election in both countries of Social Democratic governments "has sharply improved the atmosphere." PB SLOVAK GOVERNMENT APPROVES REFORM PLAN... The government has approved a plan designed to stabilize the economy and enhance foreign investment, AP reported on 28 January. The plan, which must be approved by the parliament, includes changes in commercial, civil, and criminal codes aimed at making the economic climate more transparent and efficient. It also stipulates that foreign investors be treated the same way as Slovak citizens in the privatization process. Finally, the plan requires the Finance, Economy, Agriculture, Transport, and Telecommunications Ministries to carry out audits on state-owned monopolies by June. PB AND PRESIDENTIAL ELECTION PROCEDURES. The Slovak government has approved a draft bill that regulates the procedures of direct presidential elections, CTK reported on 27 January. The legislation, which also requires passage in the parliament, sets limits on the length of election campaigns and regulates candidates' airtime on television. On 14 January, the parliament passed a bill amending the constitution to allow for the direct election of the president. Slovakia has been without a president since last March. Former President Michal Kovac, Kosice Mayor Rudolf Schuster, and Slovak Democratic Coalition deputy Juraj Svec are the only confirmed candidates so far. PB HUNGARY PROTESTS CZECH COMPLAINT TO WORLD TRADE ORGANIZATION. Budapest says it is upset by a complaint filed by the Czech Republic to the World Trade Organization (WTO) over a quota on Czech steel imports, the "Financial Times" reported on 28 January. Budapest said it imposed the quota after the Czechs restricted Hungarian wheat imports. The two governments have 60 days in which to resolve the dispute before it would go to a WTO disputes panel. PB SOUTHEASTERN EUROPE NATO ISSUES 'FINAL WARNING' TO SERBS, KOSOVARS. NATO Secretary-General Javier Solana said in Brussels on 28 January that "the appropriate authorities in Belgrade and representatives of the [Kosovar] leadership must agree to the proposals to be issued by the [international] Contact Group for completing an interim political settlement within the time frame to be established." He added that the foreign ministers of the six Contact Group countries--the U.S., U.K., Germany, France, Italy and Russia--will issue a "political ultimatum" to the Serbs and Kosovars at a meeting in London on 29 January. One day later, NATO ambassadors in Brussels will discuss what the alliance will do next. German Foreign Minister Joschka Fischer told Deutsche Welle that the Serbs and Kosovars must comply with the ultimatum "within one week." If the Serbs do not comply, NATO is expected to launch air strikes. If the Kosovars do not agree, the alliance is expected to intercept their arms supplies that arrive via Albania. PM CONTACT GROUP PREPARES ULTIMATUM. British Foreign Secretary Robin Cook told the BBC on 29 January that "the objective of today's meeting [of the Contact Group] is to summon both sides together and to do it on a tight deadline, saying 'We want you to meet next week, we want you to conclude [an interim political settlement] very shortly after that.'" Observers noted that the U.S. has agreed to the Contact Group's taking the lead in pursuing a settlement that gives a greater role to France, Russia and other European powers resentful of the preeminence of U.S. diplomacy in the former Yugoslavia. PM WHAT KIND OF SETTLEMENT WILL CONTACT GROUP PROPOSE? The Contact Group is expected to call for "proximity peace talks" in Paris or Geneva on the model of the Dayton talks, which ended the war in Bosnia in 1995. Under that model, international diplomats would shuttle between Serbian and Kosovar delegations seated in different rooms. The two delegations would not meet together formally until an agreement was ready. The Contact Group is likely to call for broad autonomy for Kosova within the frontiers of Serbia and Yugoslavia. Belgrade, however, would retain little authority in the province other than for defense and customs. The ethnic composition of the local police forces would reflect the ethnic makeup of the local population. The settlement would last for three years, after which a permanent solution would be sought. PM BLAIR, CHIRAC OFFER GROUND TROOPS. British Prime Minister Tony Blair and French President Jacques Chirac said in London on 28 January that they are "ready to envisage, along with their core NATO partners, any military action, including sending ground troops necessary to accompany the implementation of a negotiated settlement" in Kosova. Germany and, to a lesser extent, Italy have previously said they will provide ground troops if asked. In Washington, President Bill Clinton's national security spokesman noted on 28 January that the U.S. "would not deploy ground troops in a hostile environmentbut in the event of a settlement, we will consider U.S. participation in full consultation with Congress and our allies." Euronews Television reported on 29 January that NATO may send the troops already in Macedonia into Kosova in the event that a settlement emerges. The broadcast added that Serbian officials have warned of "dangerous consequences" should foreign ground troops enter the province. PM SERBS, KOSOVARS COOL ON TALKS. Serbian Deputy Prime Ministers Vojislav Seselj, Ratko Markovic and Milovan Bojic said in Belgrade on 28 January that the Serbian government is willing to hold direct talks with Kosovar representatives but will not attend an international conference on Kosova, RFE/RL's South Slavic Service reported. In Ljubljana, Adem Demaci, who is the political representative of the Kosova Liberation Army (UCK), said the UCK is opposed to talks as long as Serbian forces continue to attack Kosovars. PM BULATOVIC GOVERNMENT SLAMS MONTENEGRO. The Yugoslav federal government, which is headed by Montenegrin opposition leader Momir Bulatovic, said in a statement on 28 January that the Montenegrin government's recent agreement with Croatia on opening border crossings is "unconstitutional, illegal, and harmful to the interests ofYugoslavia," RFE/RL's South Slavic Service reported (see "RFE/RL Newsline," 28 January 1999). In a veiled warning to Croatia, the statement added that the agreement "is against international law and the principles of cooperation between internationally recognized and sovereign states." PM COUNCIL OF EUROPE REPRIMANDS CROATIA. The Council of Europe's Monitoring Committee passed a resolution in Strasbourg on 28 January saying that the Croatian government "has not accepted a single one" of the Council's recommendations in favor of restricting the voting rights of Croats living abroad. Croatian law allows ethnic Croats living or born in Bosnia- Herzegovina to receive Croatian passports and to vote. Domestic and foreign critics say that such legislation undermines the sovereignty of Bosnia-Herzegovina. They also note that it ensures a large bloc of nationalist votes from Herzegovina for President Franjo Tudjman's Croatian Democratic Community (HDZ). PM CROATIAN NEWSPAPERS COLLECT DEBTS. Officials of the pro- HDZ "Tisak" company, which has a monopoly on the distribution of newspapers, said in Zagreb that they have begun to pay their debts to individual newspapers from past sales. Editors of several independent publications had charged that "Tisak" was deliberately withholding payments to them in order to bankrupt the independent periodicals. PM HERZEGOVINIAN POLICE 'PUT ON PROBATION.' A spokeswoman for the UN police force in Herzegovina said in Mostar on 28 January that UN has put the entire ethnic Croatian police force of Stolac "on probation" for three months. Members of the 50-strong force failed on numerous occasions to come to the aid of returning Muslim refugees when Croatian nationalists attacked the Muslims. The police also failed to catch or punish the attackers. Stolac was predominantly Muslim before the Croatian-Muslim war of 1993-1994. PM ALBANIAN PARLIAMENT CREATES OMBUDSMAN'S OFFICE. Legislators voted on 28 January to set up an ombudsman's office to investigate frequent complaints from the public against the government and administration. The ombudsman is also expected to help protect citizens' rights. Elsewhere, Justice Minister Thimio Kondi signed the European convention on corruption, ATSH reported. FS TIRANA ISSUES ULTIMATUM TO REMOVE 'KIOSKS'. The municipal authorities on 28 January ordered all owners of numerous illegal buildings in Tirana's central Youth Park to remove them within six month or face expulsion, "Albanian Daily News" reported. The large park, which since communism has become a symbol of Tirana's uncontrolled urban development, is now filled with cafes and restaurants. The ultimatum is part of a broader move by the city to stop unlicensed construction activity. Police began removing illegal buildings on central Skanderbeg Square in early January. FS ROMANIAN EXTREMIST PARTY EXPELS MINERS' LEADER. The right-wing Greater Romania Party announced on 28 January that it has expelled miners' leader Miron Cozma for bringing the party "into disrepute," AFP reported. Cozma had declared at the beginning of the strike that he would temporarily withdraw from the party so that the protest would not be seen as political. Cozma and the miners received moral public support from Greater Romania Party leader Corneliu Vadim Tudor, who was suspended from the Senate (see "RFE/RL Newsline," 28 January 1999). Meanwhile, Nicolae Staiculescu, the state secretary of the Industry Ministry, said the same day that the miners will not receive a pay raise as part of their settlement with the government. PB ROMANIAN PRIME MINISTER IN BONN. Radu Vasile said on 28 January that he notices a new German attitude toward Romania, Rompres reported. Vasile, speaking after a meeting with German Chancellor Gerhard Schroeder, said Germany, in its capacity as rotating chair of the EU, could "greatly contribute to the EU's support of Romania." He said Romania "counted on support" from Bonn and added that democracy in Romania was "fragile." PB BULGARIA PRAISED FOR UPGRADES AT NUKE PLANT. The International Atomic Energy Agency (IAEA) said on 28 January that the controversial Kozloduy nuclear energy plant has made "considerable progress in the areas of safety," AP reported. IAEA deputy chief Zygmund Domaratzki said the main challenge is to maintain that level of safety. The Bulgarian government has refused requests from the West to close any of the four older reactors at the plant before their 30-year lifespans are over. The plant is Soviet-designed but has been upgraded by such Western companies as Siemens and Westinghouse. PB END NOTE THE CORRUPTION INVESTIGATION INTO LAZARENKO by Lily Hyde Despite an ongoing investigation into former Ukrainian Prime Minister Pavlo Lazarenko, who is suspected of corruption, the political party he created has nominated him to run for president in the October elections. Lazarenko was an ally of President Leonid Kuchma until the latter fired him in July 1997. Since then, he has grown increasingly critical of Kuchma, who is expected to run for re-election in the fall. At last week's congress, Lazarenko won the backing of his Hromoda party by a vote of 258 to one. The party also gave Lazarenko permission to negotiate a coalition deal with other opposition parties ahead of the election. Meanwhile, the corruption case against Lazarenko continues. It garnered international headlines early last month when Lazarenko was detained by Swiss police as he attempted to cross the border from France using a Panama passport issued to a "Mr. Lopez." In early December, he was charged with laundering $20 million but was released two weeks later when an unknown benefactor put up $3 million in bail. If convicted of money laundering under Swiss law, he faces up to five years in prison. Swiss authorities confirmed earlier this month that they would also continue helping Ukraine with its inquiries about Lazarenko's Swiss bank accounts. Lazarenko is accused by the Ukrainian authorities of taking millions of dollars out of Ukraine and channeling them to his private Swiss accounts via Russia's United Energy Systems (EES). That company was granted exclusive contracts to distribute natural gas to one-third of Ukraine during Lazarenko's term in office, from June 1996 to July 1997. In 1996, EES made a profit totaling $1 billion but paid less than $6,000 in taxes. Ukrainian Prosecutor-General Mykhailo Potebenko has repeatedly said his office has enough evidence to charge the former prime minister, but he has declined to release details while Lazarenko is protected by parliamentary immunity. The parliament is due to consider lifting his immunity next month. That debate is expected to be heated. Lazarenko has denied any wrongdoing and claims the allegations against him--both in Switzerland and at home--are part of a plot to discredit him and his party ahead of the election. Meanwhile, the investigators continue to spread their net still further. Police in The Netherlands confirmed earlier this month that at Ukraine's request, they have made inquiries into a Dutch company involved in a cattle-for-metal deal. Under that deal, put together by Lazarenko's close ally and fellow Hromada party member Mykola Agofonov in 1995, large amounts of money allegedly ended up in Lazarenko's accounts. There is widespread speculation that some of Lazarenko's political opponents continue to profit from the very gas monopolies that Lazarenko allegedly exploited. There has also been speculation that if Lazarenko is formally indicted, he may seek to bring down with him many of his former allies still in government. Many political analysts consider the investigation into Lazarenko not as a concerted effort to expose corruption but rather as a power struggle within the so- called Dnipropetrovsk "clan," which still dominates the government. President Kuchma, former boss of the Dnipropetrovsk rocket plant Yuzhmash, has surrounded himself with colleagues from the eastern Ukrainian city. In 1996, Kuchma asked Lazarenko to leave his post of governor of the Dnipropetrovsk region to become deputy prime minister. Lazarenko remained in government until Kuchma fired him. He then established his Hromada party and built it up into a significant political force with more than 40 seats in the parliament. Its political platform barely differs from that of the People's Democratic Party, the group most closely allied with Kuchma. At his Kyiv press conference last month, Lazarenko insisted that he has not broken any Swiss laws. But he acknowledged he was a participant in a "dirty war" in which each side had overstepped a predetermined line. According to Vyacheslav Pikhovshek, an analyst at Kyiv's Independent Center for Political Research, "this means that there was a deal" between Lazarenko and those still in power. He says the parties to the deal "agreed that they would not break specific rules--and these rules have nothing in common with the law." So far, however, nothing has been proven in a court of law. It is therefore difficult for an observer to draw conclusions about the Lazarenko affair. But two things are clear. The investigation is adding to the perception abroad that corruption plays a large role in business dealings in Ukraine, a perception widely seen as a key factor in frightening off foreign investors. Second, it is adding to the cynicism with which many ordinary Ukrainians view their country's political leaders. The author is a Kyiv-based contributor to RFE/RL. xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx Copyright (c) 1999 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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