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RFE/RL NEWSLINE Vol. 3, No. 34, Part I, 18 February 1999
___________________________________________________________ RFE/RL NEWSLINE Vol. 3, No. 34, Part I, 18 February 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 xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx Headlines, Part I * YELTSIN WARNS CLINTON NOT TO ATTACK YUGOSLAVIA * FEDERATION COUNCIL APPROVES 1999 BUDGET * ARMENIAN PARLIAMENT LIFTS FORMER MINISTER'S IMMUNITY xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx RUSSIA YELTSIN WARNS CLINTON NOT TO ATTACK YUGOSLAVIA. President Boris Yeltsin telephoned with his U.S. counterpart, Bill Clinton, on 17 February to say, "We will not allow you to touch Kosova," ITAR-TASS reported the next day. Yeltsin said he has told the U.S. president both by telephone and letter that NATO must not launch any airstrikes against Yugoslavia even if Belgrade fails to meet the deadline for a truce with the Kosovars. Such a bombing attack "won't happen," Yeltsin said. Colonel-General Leonid Ivashov, the head of international cooperation at the Russian Defense Ministry, said NATO "has no diplomatic, legal, political, or economic levers in its arsenal, only naked military force." He called plans to send NATO troops to Kosova "a very crude and simplistic" way of settling the conflict. PG/PB FEDERATION COUNCIL APPROVES 1999 BUDGET. By a vote of 130 to 18, the Federation Council gave final approval to the government's 1999 budget, Russian agencies reported. The budget calls for expenditures of 575 billion rubles ($25 billion) and revenues of 474 billion rubles ($21 billion). Prime Minister Yevgenii Primakov thanked the council for its vote, adding that "you have paved the way for intensive work in the economy," even though he conceded that the budget is far from perfect and "cannot satisfy either us or you." Moreover, he promised that the budget will not be sequestered, as previous budgets have been. Finance Minister Mikhail Zadornov said the government expects to gain additional revenues by delaying the reduction in value-added tax from 1 April to 1 July. But many observers suggested that the budget's assumptions--30 percent inflation in 1999 and a ruble exchange rate of 21.5 to the dollar--are so unrealistic that the budget will never work or attract support from Western financial institutions. PG RUSSIA FACES NEW DIFFICULTIES IN SECURING MORE AID. Premier Primakov said that Russia's positions in talks with international lenders "could not be more flexible" than they are at present, Interfax reported on 17 February. The IMF technical adviser to the Federal Tax Service, Richard Hifield, said that the IMF would like to see Russia work harder to collect taxes, Interfax reported on 17 February. His comments, which were echoed by the World Bank, other IMF officials, and the U.S., came as the IMF delegation departed Moscow without making a commitment for more assistance. Meanwhile, German officials on the eve of Chancellor Gerhard Schroeder's visit to Moscow said Bonn cannot extend any new loans to Russia. But World Bank officials indicated that they expect early agreement with Russia on extending three loans that the Russian government has already factored into the budget. In a related development, Russian First Deputy Prime Minister Yurii Maslyukov said he will remain in place as the chief Russian negotiator with the IMF. PG RUSSIA FACES 10 MILLION TON GRAIN SHORTFALL. An official at the Russian Ministry of Food and Agriculture said Russia will face a grain shortfall of some 10 million tons during the first half of 1999 as a result of last year's disastrous harvest, Russian agencies reported. But the situation may deteriorate even further. Farm Minister Viktor Semenov said Russia will have only a 1 million ton reserve after the winter season, down from the 20 million ton reserve a year ago. He indicated that Russia must harvest at least 73 million tons of grain this year, up from 47.8 million in 1998, or be forced to purchase grain from abroad. That may not happen. Deputy Prime Minister Gennadii Kulik said that Russia is likely to experience another drought this year and thus be unable to improve on the 1998 harvest. As a result, Russia has satisfied requirements for food aid from the EU and is considering asking Canada for food assistance as well, Kulik said. PG IVANOV SEES NO FUNDAMENTAL RIFT WITH U.S.... Despite disagreements between Moscow and Washington over NATO expansion, Kosova, and Iraq, Russian Foreign Minister Igor Ivanov said on 17 February that there is no "fundamental division" between the two governments, Interfax reported. He suggested that the main achievement in bilateral relations is that it is now "impossible" for the differences that do exist "to degenerate into direct confrontation." PG ŠBUT WARNS AGAINST NATO EXPANSIONŠ If NATO continues to expand and especially if this process includes the Baltic countries or CIS states, Ivanov said that "Russia will take any steps it finds necessary to guarantee [Russian] national security." He repeated Moscow's insistence that agreement must be reached on modifications in the CFE treaty before the formal admission of the three new NATO countries in March, something he thought could be achieved during the visit to Moscow later this week of U.S. Deputy Secretary of State Strobe Talbott. PG Š URGES UN SECURITY COUNCIL TO DEBATE KOSOVAŠ Ivanov said that foreign troops--including Russian ones--could be deployed on Yugoslav territory only with the agreement of the Belgrade authorities. And he suggested that the UN Security Council should take up the matter rather than leaving it to unilateral NATO action, which Moscow continues to oppose. Meanwhile, the State Duma voted 318 to zero to approve a statement condemning any use of force in Kosova. And Colonel- General Leonid Ivashov, the Defense Ministry's official responsible for international cooperation, told Interfax that the Western alliance has "no diplomatic, legal, political, or economic levers in its arsenal, only naked military force," which, he said, the Russian government must oppose. PG ŠAND CRITICIZES U.S., BRITAIN ON IRAQ. Arguing that the U.S. and Britain have succeeded only "in making matters worse" by their lack of patience in Iraq, Ivanov said the UN Security Council should develop new approaches, including the replacement of inspections with monitoring of Iraqi military facilities. Without naming names, he denounced those who have deliberately spread what he said were "lies" and "provocations" about Russian involvement in Iraq, Iran, and other Middle Eastern countries. PG LUZHKOV, ZHIRINOVSKY CONDEMN UKRAINIAN PACT. Moscow Mayor Yurii Luzhkov denounced the ratification of the Russian- Ukrainian treaty as "shameful," Interfax reported on 17 February. He said that he will let Russian citizens know just who voted for the "surrender" of Crimea and Sevastopol. And he suggested that the ratification might be declared "improper, immaterial, and unlawful" by Russian courts. Meanwhile, Liberal Democratic Party of Russia leader Vladimir Zhirinovsky described the ratification of the treaty as a "black day in Russian history" and said that the Federation Council acted as "a council of Russia's destroyers." Krasnoyarsk Governor Aleksandr Lebed was also among those who sharply criticized the ratification of the accord. PG DUMA URGES NEW ANTI-CRISIS PROGRAM. By a vote of 261 to zero, the Duma approved an appeal calling on President Yeltsin and the government to work together with the parliament to develop a new anti-crisis program, Interfax reported. According to the resolution, the current crisis "cannot be overcome while the main defects in market relations still exist." PG DOLLAR'S PURCHASING POWER IN RUSSIA DOUBLED SINCE AUGUST. According to Interfax, the purchasing power of the U.S. dollar in Russia has nearly doubled since the August 1998 financial crisis. The ruble has lost almost 73 percent of its value, and inflation in the consumer sector has exceeded 90 percent during this period. As a result, holders of dollars have seen their purchasing power increase twofold. PG YELTSIN TEAM READY TO ATTEND IMPEACHMENT DEBATE. President Boris Yeltsin's aide Oleg Sysuev said on Ekho Moskvy that the presidential administration is quite prepared to take part in any discussion of the findings of the commission considering Yeltsin's impeachment, Interfax reported. The presidential envoy to the Duma would lead any such participation, Sysuev said. PG COMMUNISTS OPPOSE SIMULTANEOUS ELECTIONS... The Communist Party of Russia is opposed to simultaneous parliamentary and presidential polls, Communist Party leader Gennadii Zyuganov told Interfax on 17 February. He said the country's constitution precludes such elections. PG ŠDENOUNCE GOVERNMENT PROBE OF PARTY. Zyuganov also denounced the plans of the Justice Ministry to examine whether the Communist Party is complying with its charter. The party chief said that Communists have "not the slightest reason to worry about any objective probes," but he said that the current probe is politically motivated and thus should be dropped. If it is not, Zyuganov said, that will call into question Communist participation "in the task group now preparing an agreement on civil peace and reconciliation." PG RUSSIAN CUSTOMS NOW DENOMINATED IN EUROS. Prime Minister Primakov has signed a decree ordering that customs duties be calculated in euros rather than ecus, Interfax reported on 17 February. PG U.S. TEAM TO ADDRESS RUSSIAN MILITARY'S Y2K PROBLEMS. A U.S. military team arrived in Moscow on 17 February to begin talks with their Russian counterparts on how to cope with the millennium bug problem. Aleksandr Krupnov, the head of the State Communication Committee, said that Russia needs some $3 billion to overcome the problem in time but that Moscow does not currently have the funds. PG FOREIGN NUCLEAR FUEL REPROCESSING IN RUSSIA URGED. In order to raise additional funds, Russian Atomic Energy Minister Yevgenii Adamov has called for changing current regulations in order to allow Moscow to import and reprocess foreign- owned nuclear fuel, Interfax reported. on 17 February. He said that the average world price for such reprocessing is now approximately $1,000 per kilogram. PG MOSCOW URGES FAIR TRIAL FOR KURDISH LEADER. Following a meeting with visiting his Syrian counterpart, Farouq al- Shara, Foreign Minister Ivanov said on 17 February that Moscow hopes that any trial of Kurdish leader Abdullah Ocalan will be both fair and attended by international observers. But Moscow newspapers warned Russians against planning to spend their holidays on Turkish beaches, Reuters reported. PG DUMA VOTES TO BAN ALCOHOL IMPORTS UNTIL 2002. In the second and third readings, the Duma approved a draft law banning imports of alcohol until 1 January 2002, Interfax reported on 17 February. Duma members explained their vote as part of an effort to "combat the illegal production and sale of ethyl spirits and alcohol products." PG DUMA SEEKS TO PUNISH EMPLOYERS WHO DON'T PAY WORKERS. The Duma passed a bill that will hold employers criminally liable for not paying wages to their employees because of "mercenary or other personal interests," ITAR-TASS reported. If found guilty, employers could be fined or sent to prison for up to seven years. The bill now goes to the Federation Council. PG ROSSIYA AIRLINE CHIEF SACKED FOR AIRPORT COLLISION. Prime Minister Primakov has fired Vladimir Kachnov, head of the state-owned Rossiya airline, holding him responsible for the 8 February ground collision at the Moscow airport between Yeltsin's IL-96 and a plane that had brought Italian Prime Minister Massimo D'Alema to the Russian capital, Interfax reported. Yeltsin was returning from the funeral of King Hussein in Jordan at the time of the collision. D'Alema was not in his plane at the time. PG RUSSIA, CYPRUS AGREE ON S-300 DEPLOYMENT ON CRETE. The Cypriot embassy in Moscow issued a statement on 18 February confirming that Cypriot and Russian officials have reached a final agreement on the deployment on Crete of the S-300 air defense missile complexes originally ordered by Cyprus for deployment on that island, Reuters reported (see "RFE/RL Newsline." 17 February 1999). It is unclear whether Cypriot Defense Minister Yannakis Chrisostomis, who traveled to Moscow to finalize the agreement with the Russian arms export concern Rosvooruzhenie, met on 17 February, as planned, with his Russian counterpart, Sergeev. LF TRANSCAUCASUS AND CENTRAL ASIA ARMENIAN PARLIAMENT LIFTS FORMER MINISTER'S IMMUNITY. Deputies voted by 102 to one on 17 February to lift the parliamentary immunity of former Interior Minister Vano Siradeghian, AP and RFE/RL's Yerevan bureau reported. Addressing the parliament before the vote, Prosecutor-General Aghvan Hovsepian said he has sufficient information to open criminal proceedings against Siradeghian in three cases involving five planned murders, according to Noyan Tapan. Siradeghian fled abroad on 29 January, three days after lawmakers had refused an earlier request by Hovsepian to impeach him. He is currently believed to be in France (see "RFE/RL Newsline," 26 January and 1 February, 1999). Interior and National Security Minister Serzh Sarkisian said earlier on 17 February that if Siradeghian's immunity is lifted, he will seek his extradition. LF U.S. EXPERTS TO HELP ARMENIAN MURDER INVESTIGATION. Two FBI officials have arrived in Armenia at the request of the country's leadership to participate in the ongoing investigation into the murder earlier this month of Interior Ministry troops commander Artsrun Markarian, ITAR-TASS reported on 16 February. The same day, the former ruling Armenian Pan-National Movement (HHSh) and the former majority Hanrapetutiun parliamentary faction issued separate statements saying that the initial hypothesis that Markarian's death was suicide can be attributed to "cynicism" and criticizing the alleged inability of Interior and National Security Minister Sarkisian to prevent crime, Noyan Tapan reported. LF ARMENIA'S CHANCES OF WTO MEMBERSHIP ASSESSED. Ara Hakobian, the Armenian official who presides over negotiations on Armenia's acceptance into membership of the World Trade Organization, told journalists in 15 February that the favorable prospects for Armenia's joining that organization has been jeopardized by the equivocal policy of the former administration, Noyan Tapan reported on 17 February. Armenia's new leadership has reaffirmed its eagerness to join the WTO, Hakobian added. Prime Minister Armen Darpinian said in November 1998 that he believes Armenia will join the organization no later than July 1999. LF RUSSIA TO STRENGTHEN AIR DEFENSES IN ARMENIA. Speaking on his arrival in Yerevan on 17 February, Russian Air Force Commander Colonel-General Anatolii Kornukov said Moscow has begun delivering the components of S-300 air defense systems to its military base at Gyumri, ITAR-TASS and Turan reported. Kornukov said the air-defense system currently installed at that facility is obsolete. He further characterized the overall level of armaments in the South Caucasus as "in favor of the states bordering Armenia, not Armenia itself." He said Moscow "would be pleased" if Azerbaijan decided to join the CIS unified air defense system. "Obshchaya gazeta" of 11-17 February claimed that the deployment of the S-300 systems and additional MiG-29 aircraft is intended to protect Russia's Armenian base from a possible attack by NATO missiles and fighter aircraft stationed at the Incirlik base in eastern Turkey. LF TURKEY CONCERNED THAT CAUCASUS MAY BECOME 'MANEUVERING ZONE.' Meeting on 16 February in Ankara with his Azerbaijani counterpart Tofik Zulfugarov, Turkish Foreign Minister Ismail Cem said "we are anxious about the recent arms proliferation in the Caucasus. We don't want the region to become a maneuvering zone for larger countries. The Caucasus belongs to the Caucasian countries, and it should remain like that," according to the "Turkish Daily News" on 17 February. Cem said the close relations between Turkey and Azerbaijan constitute a base for peace and stability in the region. Zulfugarov, on a two-day official visit to Turkey, was also scheduled to meet with President Suleyman Demirel and Prime Minister Bulent Ecevit to discuss the Karabakh conflict and the planned Baku-Ceyhan export pipeline for Azerbaijan's Caspian oil. LF U.S. UPBEAT ON AZERBAIJAN EXPORT PIPELINE... Stanley Escudero, the U.S. ambassador to Baku, told Turan on 17 February that "great progress" has been made in the past few months toward an agreement on construction of the Baku-Ceyhan oil export pipeline. Escudero said that talks between the governments of Azerbaijan and Turkey and the oil companies engaged in exploiting Caspian oil are continuing, and he predicted that a final agreement on financing that pipeline will be made by the end of the summer. Anatolia News Agency reported on 17 February that two intergovernmental agreements between Turkey and Azerbaijan related to that project are expected to be signed in March and ratified within 90 days by both parliaments. LF ...WHILE OIL COMPANIES UNENTHUSIASTIC. Richard Oliver, managing director of BP Amoco, the senior partner in the first and largest international consortium to begin developing Azerbaijan's Caspian reserves, has said that the Baku-Ceyhan project is not currently needed, given that two pipelines for exporting Azerbaijan's oil already exist, Bloomberg reported on 17 February. He added that there is "no need" for an early decision to proceed with construction of the Baku-Ceyhan pipeline. LF AZERBAIJANI PRESIDENT ENDORSES PLANNED TRANS-CASPIAN GAS PIPELINE. Heidar Aliev has agreed to a formal request by his Turkmen counterpart, Saparmurat Niyazov, to route the planned Trans-Caspian gas pipeline to Turkey via Azerbaijan, Reuters and Turan reported on 17 February. Meeting with Aliev the previous day, Yossef Maiman, chairman of the Israeli company that is helping to form a consortium to build that pipeline, said the U.S. Ex-Im Bank will contribute approximately $1 billion toward the estimated $3 billion construction costs. LF MORE AZERBAIJANI OPPOSITION ACTIVISTS SENTENCED. A Baku district court on 17 February handed down sentences of two to three years in prison to 15 opposition activists, AP and RFE/RL's Baku bureau reported. The activists had participated in a banned opposition rally in Baku on 8 November, which was forcibly dispersed by police (see "RFE/RL Newsline," 9 November 1998). Several of those sentenced were found guilty of resisting arrest. Also on 17 February, the newspaper "Halq," which is published by the president's office, reported that Azerbaijan Popular Front Party Chairman Abulfaz Elchibey has announced his candidacy in the 2003 presidential elections, according to Turan. LF KARIMOV DECLARES DAY OF MOURNING... Uzbek President Islam Karimov has declared 18 February a day of mourning for the victims of the bombings in Tashkent two days earlier, RFE/RL corespondents reported. ITAR-TASS reported on 18 February that 45 of the more than 150 people hospitalized have returned home, while 12 remain in critical condition following "complicated" operations. Fifteen people were killed in the explosions. Meanwhile, Halle Degn of the OSCE told a news conference in Tashkent on 17 February that Uzbek security agencies have apprehended five people in connection with the terrorist act. Several news agencies quote Karimov as saying that "if necessary, we will cut off the hands of those responsible" for the bombings. BP ŠREPORTS ECONOMIC FIGURES FOR 1998. President Karimov addressing the cabinet on 17 February, said GDP increased by 4.4 percent last year, industrial output by 5.8 percent, and agricultural production by 4 percent, Interfax reported. Monthly inflation stood at 1.9 percent, and the Central Bank's monthly refinancing rate stayed below 3 percent. Retail trade was up by 14 percent and consumer goods output by 7.2 percent. Foreign investment last year totaled $1.3 billion, a 22.6 percent increase over 1997. Karimov noted that the government hopes that this figure will increase to $2 billion in 1999. The foreign trade surplus reached $240 million, which contributed to augmenting foreign currency and gold reserves. Karimov, however, did not give a figure for hard currency reserves. BP MYSTERY ILLNESS CLAIMS 350 LIVES NEAR TAJIK-AFGHAN BORDER. An illness reported to be "unknown to modern medicine" has claimed the lives of 350 people in the area along the Tajik- Afghan border over the past two weeks, ITAR-TASS and Asia Plus reported on 17 February. The illness has affected mainly young children and the elderly. Since the start of 1999, 203 cases of typhoid have been reported in the southern Tajik city of Kulyab. BP KAZAKH COURT RULES AGAINST BRITISH COMPANY. Kazakhstan's Supreme Court has ruled that Britain's Trans-World Group caused "considerable damage to Kazakhstan's economic and financial interests," Interfax reported on 17 February. According to the court, the British company is responsible for losses totaling $145 million at the Aksu Ferroalloy Works, $102 million at Aluminum of Kazakhstan, more than $86 million at the Ferrokhrom ferroalloy works, and some $40 million at the Sokolov-Sarbai Mining Production Association, Kazakhstan's leading producer of iron-ore products. The court has already declared agreements with the British company to be invalid. BP KYRGYZ PRESIDENT SAYS ECONOMY NEEDS MORE FOREIGN INVESTMENT. Askar Akayev told a 17 February meeting of the Advisory Council on Investment Policy that the country's economic stability this year depends on the level of foreign investment, Interfax reported. Akayev listed five main goals aimed at attracting foreign investment. First, improving tax legislation for both local and foreign businesses and establishing a special board at the Tax Inspectorate to concentrate on deals with foreign companies. Second, liberalizing legislation on foreign investment. Third, reforming the judicial system to ensure the legality of deals between state agencies and foreign producers (according to Akayev, the country has too few lawyers with expertise in interpreting the Civil Code). Fourth, limiting the interference of administrative bodies in the activities of foreign companies. And fifth, setting up free trade zones in the country. BP KYRGYZ INCREASE SECURITY ALONG BORDER WITH UZBEKISTAN. On the orders of President Akayev, security measures along Kyrgyzstan's border with Uzbekistan are being increased following the terrorist bombings in Tashkent on 16 February, RFE/RL correspondents in Bishkek reported. In some areas, roads leading from Uzbekistan into Kyrgyzstan have been closed. Akayev also ordered Kyrgyz security forces to cooperate fully with their Uzbek counterparts. BP KURDS DEMONSTRATE OUTSIDE GOVERNMENT BUILDING IN BISHKEK. Some 150 Kurds demonstrated outside the government building in the Kyrgyz capital to urge President Akayev to appeal to Turkish leaders for clemency toward captured Kurdistan Workers' Party leader Abdullah Ocalan, RFE/RL correspondents reported. Sulhadin Kasymov, chairman of the Nyshtyman Kurdish Association in Kyrgyzstan, said there are currently 30,000- 40,000 Kurds living in Kyrgyzstan. BP xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx Copyright (c) 1999 RFE/RL, Inc. All rights reserved. xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx HOW TO SUBSCRIBE Send an email to email@example.com with the word subscribe as the subject of the message. HOW TO UNSUBSCRIBE Send an email to firstname.lastname@example.org with the word unsubscribe as the subject of the message. 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