RFE/RL NEWSLINE Vol 3, No. 71, Part I, 13 April 1999

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RFE/RL NEWSLINE Vol 3, No. 71, Part I, 13 April 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

* PRIMAKOV DEFENDS GOVERNMENT AGAINST YELTSIN CRITICISM

* IMPEACHMENT VOTE DELAYED

* NEW PRIME MINISTER NAMED IN KYRGYZSTAN

END NOTE: KAZAKH PRESIDENT PLEDGES DEMOCRATIZATION--AT HIS
OWN PACE AND ON HIS OWN TERMS
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RUSSIA

PRIMAKOV DEFENDS GOVERNMENT AGAINST YELTSIN CRITICISM... In a
12-minute televised national address on 10 April, Prime
Minister Yevgenii Primakov defended his government's record,
responding directly to Yeltsin's comment the previous day
that "today, Primakov is useful, tomorrow we'll see." He
claimed that in the last seven months, his government has
paid off all debts to state workers, reduced inflation from
11 percent in December to 2.8 percent in March, and limited
the growth of the value of the dollar to only five rubles in
the past seven months. He also repeated that he has "no
ambitions or desire to participate in presidential
elections," adding that he is "not clinging to the office of
prime minister, especially when a time frame for my work is
being set. Today, I am useful, tomorrow we'll see." JAC

...AS BATTLE BEGINS OVER ECONOMIC POLICY? President Yeltsin
responded to Primakov's address, according to "Kommersant
Daily" on 13 April, by making decisive pronouncements about
economic policy and openly criticizing the government's
budget policy in his budget message issued the previous day.
Specifically, Yeltsin suggested that the number of regions
receiving federal money should be drastically reduced, and
Moscow should instead concentrate on funding those regions
that really require financial assistance. The president added
that it was necessary to fine-tune the mechanism for
restructuring debts owed to the federal budget with the aim
of eventually liquidating them. JAC

IMPEACHMENT VOTE DELAYED. After President Boris Yeltsin
publicly asked the State Duma to either hold impeachment
hearings as scheduled or drop them altogether, leaders of the
various Duma factions voted on 12 April to postpone them.
Yabloko leader Grigorii Yavlinskii told reporters that the
Duma will decide when to hold the vote after deputies resolve
procedural questions related to the impeachment process, such
as whether or not to hold an open vote. The Communists and
other leftist factions favor an open vote. Duma Chairman
Gennadii Seleznev said that the vote will most likely take
place after the 1 May and 9 May holidays. JAC

IMF OBJECTING TO RUBLE'S LACK OF CONVERTIBILITY. An IMF
spokesperson told RFE/RL's Washington bureau on 12 April that
it has advised the Russian government to remove constraints
to trading on its foreign exchange market. Interfax reported
that the fund objected in particular to a Central Bank (CB)
order banning foreign banks from using money in their
correspondent accounts in Russian banks to buy hard currency.
The order was part of a recent series of measures by the CB
to help stabilize the ruble's exchange rate. The CB also
revoked the rights of Russian banks to buy U.S. dollars
during the special morning currency trading session. In the
fall, the fund objected to the creation of the special
trading sessions, but Central Bank Chairman Viktor
Gerashchenko at the time said that the measure was only
temporary and would be discontinued as soon as possible. JAC

SLAVIC UNION EXPANSION ON HOLD UNTIL AIR STRIKES END. Russia
is "continuing to consider" the possibility of admitting
Yugoslavia to the Union of Belarus and Russia, Foreign
Ministry spokesman Vladmir Rakhmanin said on 12 April. The
previous day, Yugoslavia's ambassador to Russia, Borislav
Milosevic, submitted a letter from his brother, Yugoslav
President Slobodan Milosevic, reportedly requesting
Yugoslavia's admission to the union. However, "diplomatic
sources" told Interfax that the letter did not contain a
formal request and expressed only Milosevic's "profound
satisfaction" with Yeltsin's position on Yugoslavia's
possible admission (see "RFE/RL Newsline," 9 April 1999).
Yeltsin instructed the Foreign Ministry to hold consultations
with Belarus about the possibility of admitting Yugoslavia
into the union, according to ITAR-TASS, but the issue was not
on the agenda of the union's Executive Committee meeting
scheduled for 13 April in Minsk. Both Foreign Minister Igor
Ivanov and Moscow Mayor Yurii Luzhkov have suggested that an
expanded confederation should be considered only after air
strikes have ended. (See related Belarusian and Yugoslav
stories in Part II.) JAC

NEW U.S. PRIVATE INVESTMENT TO FLOW INTO RUSSIAN FARM SECTOR?
Two U.S. farm equipment manufacturers, John Deere and the
Case Corporation, are planning to invest about $400 million
in Russia and establishing farm equipment leasing
enterprises, Deputy Prime Minister Gennadii Kulik told
Interfax on 12 April. According to Kulik, John Deere will
invest $200 million in Rostelmash in the Rostov Oblast and
Case will invest $200 million in Kirov Works in St.
Petersburg. They will raise an additional $2 billion from
U.S. investment banks, Kulik said. Local Rostov-on-the-Don
newspaper "Gorod N" reported on 24 March that the companies'
projects were to be a top item on the agenda of Prime
Minister Primakov's meeting with U.S. Vice President Al Gore
that was cancelled after NATO air strikes appeared imminent.
It also said that John Deere wanted to reach an agreement
with the Russian government before its plans with Rostelmash
could go forward. JAC

GDP FALLING, FOREIGN DEBT RISING. Inflation soared in 1998,
rising to 84.4 percent compared with just 11.8 percent in
1997, according to a Finance Ministry report. GDP slipped 4.6
percent last year, while industrial production slumped 5.2
percent. Exports dropped to 87 percent of the previous year's
level, while imports contracted 15.1 percent. Meanwhile,
Russia's foreign debt exceeded GDP in 1998 by 18.7 percent
and its domestic debt by 19.4 percent, "Segodnya" reported on
9 April. JAC

RUSSIAN INSURERS WON'T BE FLYING ON NEW YEAR'S EVE? Several
Russian insurance companies have hiked insurance rates for
Russian airlines because they fear that domestic carriers
have inadequately prepared their computers systems for the
transition to the year 2000, Viktor Gorlov, deputy director
of the Federal Aviation Service told Interfax on 11 April.
According to "Segodnya," Gorlov said that all airlines which
do not fulfill the demands of the aviation service with
regard to preparing for 2000 will lose their license.
However, he admitted that the aviation service itself did not
have enough resources to test all the airlines' systems
before 31 December. JAC

FORMER COSMONAUTS APPEAL FOR DONATIONS FOR "MIR"... Two
former cosmonauts who are now Duma deputies, Vitalii
Sevastyanov and German Titov, made a public appeal for
donations to keep the space station "Mir" in orbit, "The
Moscow Times" reported on 13 April. Sevastyanov, a member of
the Communist party, blasted the U.S. for its efforts to push
Russia into abandoning "Mir" and concentrating on the
"International Space Station," the daily reported. Earlier, a
Canadian citizen of Russian origin donated $100,000 for the
station, according to a spokesman for the Russian Space
Agency. The previous day, agency Director Yurii Koptev told
reporters that extra-budgetary sources for financing "Mir"
must be found before mid-May, Interfax reported. JAC

...AS SARATOV GOVERNOR PREPARES FOR BLAST-OFF. Saratov Oblast
Governor Dmitrii Ayatskov intends to enter orbit as a member
of a Russian space crew in 2001, Ekho Moskvy reported on 12
April. According to Ayatskov, he has already reached an
agreement with the Russian Space Agency about his
participation on a launch planned to commemorate the 40th
anniversary of the first space flight. Ayatskov, who is known
for his abrupt shifts in opinion, keeps a crocodile in his
office, "Kommersant-Daily" reported on 3 March. JAC

DEFENSE MINISTERS' MOSCOW MEETING CANCELLED. The meeting of
the defense ministers of Russia, China, Kazakhstan,
Kyrgyzstan, and Tajikistan, scheduled to take place in Moscow
on 14-15 April, has been cancelled, Interfax reported on 12
April quoting an unidentified Russian Defense Ministry
official. ITAR-TASS on 13 April reported that Chinese Defense
Minister Chi Haotian had decided not to travel to Moscow for
the meeting because his counterpart from Kazakhstan, Mukhtar
Altynbaev, would not be attending. The Moscow meeting was to
have focused on border security. LF

TRANSCAUCASUS AND CENTRAL ASIA

ARMENIAN PREMIER SLAMS OPPOSITION IN ENERGY TARIFF DEBATE. In
an uncharacteristically politicized and harshly worded
address to parliament on 12 April, Armen Darpinian criticized
opposition deputies for their ongoing campaign to reverse the
increase in electricity charges that took effect in January
of this year, RFE/RL's Yerevan bureau reported. Darpinian
accused "forces supporting the former authorities" of trying
to sabotage his government's policy of economic
liberalization to gain political capital. The parliament
voted on 15 March to reduce energy tariffs, with deputies
from the pro-government Yerkrapah majority group declining to
oppose the motion for fear of alienating voters in the runup
to the 30 May parliamentary elections (see "RFE/RL Newsline,"
17 March 1999). At that time, presidential press spokesman
Vahe Gabrielian said that President Robert Kocharian will
veto the bill if parliament passes it in the second and final
reading. LF

GEORGIAN PRESIDENT DISCUSSES KOSOVA'S RELEVANCE. In his
traditional Monday radio broadcast on 12 April, Eduard
Shevardnadze argued that the conflict in Kosova is the direct
consequence of indifference to genocide and ethnic cleansing,
and demonstrates the dangers inherent in "freezing" conflicts
rather than actively seeking to resolve them, Caucasus Press
and Interfax reported. For that reason, Shevardnadze
continued, all those countries engaged in seeking to mediate
a solution to the Abkhaz conflict should step up their
efforts to do so. Russia in particular, Shevardnadze said,
has "a unique chance" to end the deadlock. Shevardnadze added
that at the Washington NATO summit later this month he
intends to stress the need for new international security
guarantees that would preclude a repetition of the war in
Yugoslavia, which he attributed to the UN Security Council's
failure to resort to peace enforcement mechanisms at an
earlier stage. LF

KAZAKH PRIME MINISTER CONCLUDES VISIT TO IRAN. Nurlan
Balghymbaev visited Tehran on 10-11 April in preparation for
the meeting between the two countries' presidents scheduled
for this fall, ITAR-TASS reported on 12 April. Balghymbaev
met with Vice President Hasan Habibi and President Mohammad
Khatami, whom he presented with the Kazakh text of the treaty
on trade and economic cooperation that is to be signed at the
summit. Balghymbaev signed five intergovernmental trade
agreements, including one on renewing the suspended export,
via Iran, of oil from Kazakhstan. The two sides also
discussed their diverging views on the status of the Caspian
Sea and the prospects for routing export pipelines for oil
from Kazakhstan and Turkmenistan via Iran. LF

NEW PRIME MINISTER NAMED IN KYRGYZSTAN. President Askar Akaev
named the governor of Osh oblast, 52-year-old Amangeldi
Muraliev, as premier on 12 April, RFE/RL's Bishkek bureau
reported. Muraliev graduated from the Frunze Polytechnical
Institute in 1967 and in the 1980s served as director of
several industrial plants in that city, of which he was
appointed mayor in 1986. Since 1991, Muraliev has served as
state secretary for economics, minister of finance, chairman
of the state property fund, and vice prime minister for
industry. He was appointed Osh oblast governor three years
ago and was named acting premier last week following the
death of Djumabek Ibraimov (see "RFE/RL Newsline," 6 April
1999). The upper chamber of parliament must approve
Muraliev's appointment at its next session, which begins on
20 April. LF

TAJIK OPPOSITION REPRESENTATIVE DISMISSED FROM GOVERNMENT.
Following a government meeting on 10 April to review
implementation of the budget during the first quarter,
President Imomali Rakhmonov fired five senior officials
including State Customs Committee head Rahim Karimov,
Interfax and AP-Blitz reported on 12 April. Karimov is a
member of the United Tajik Opposition, which under the 1997
peace agreement was granted the right to nominate 30 percent
of senior government personnel. The five were accused of
financial laxness, including failure to ensure tax
collection. On the same day, Rakhmonov also dismissed the
chairmen of the Jabbor-Rasulov and Beshkent regions.

END NOTE

KAZAKH PRESIDENT PLEDGES DEMOCRATIZATION--AT HIS OWN PACE AND
ON HIS OWN TERMS

By Liz Fuller

	Addressing both chambers of Kazakhstan's parliament on
31 March, President Nursultan Nazarbaev sought to reassure
those Western critics who had interpreted the January 1999
pre-term presidential election as a step backwards on the
road to democratization.
	In that poll, which was not due until December 2000,
Nazarbaev was re-elected with 79.8 percent of the vote. The
one politician who might have posed a serious challenge to
Nazarbaev, former Premier Akezhan Kazhegeldin, was barred
from participating on a legal technicality.
	The OSCE registered its displeasure at the less than
democratic conduct of the election campaign by declining to
send a fully-fledged monitoring mission. It subsequently
issued a statement describing the election as falling far
short of international standards.
	In his 31 March address, Nazarbaev acknowledged that
"our friends in the West ... are impatient, they want us to
speed up the pace of democratization." But he made it clear
that he considered a gradual transition to greater political
freedom more appropriate.
	Nazarbaev told deputies that elections to the lower
house of parliament will take place as scheduled in October
1999. Some observers had predicted that the date would be
brought forward in order to deprive opposition parties of the
opportunity to prepare their respective campaigns.
	Nazarbaev added that the parliament will soon adopt a
new election law, together with new legislation on the role
and duties of the president, the government, and the
parliament, and the conduct of referenda. At present,
Kazakhstan has no election law. Previous polls, including the
1999 presidential election, were conducted in accordance with
procedures set out in presidential decrees, which have the
force of law.
	Opposition politicians, including Kazhegeldin, Communist
Party leader Serikbolsyn Abdildin and Seydakhmet Quttyqadam,
the chairman of the Orleu political movement, had addressed
an open letter to the parliament in March criticizing those
presidential decrees on the conduct of elections as imposing
"totalitarian control over the electoral system." They
demanded the enacting of a new law that would ensure that
both the parliamentary poll and municipal elections due this
fall will be "truly democratic."
	Nazarbaev indicated that under the new election
legislation, the number of seats in the lower house will be
increased from 67 to 77, of which ten will be allocated under
the proportional system. (He did not stipulate whether
political parties would have to poll a minimum percentage of
the vote in order to qualify for representation under that
system.) Nazarbaev also said that the new election law
simplifies the registration process for parties and
individual candidates, and cuts by half the registration fee
for parliamentary candidates.
	But the new election law apparently does not meet one
key opposition demand, namely that in the future the
governors of Kazakhstan's 14 oblasts should be elected rather
than appointed by the president. Nazarbaev objected that such
elections could undermine "social and economic stability."
That argument is valid insofar as a poll of some 2,000
citizens of Kazakhstan conducted in the summer of 1997
indicated that people are more inclined to blame local
administrators for social and economic problems than either
the national government or the president. In a free election,
voters might therefore reject the present governors, who were
selected for their personal loyalty to the president.
	But at the same time, Nazarbaev made it clear that he
intends to increase the responsibility of the oblast
governors for the social and economic well-being of a
population that appears to many outsiders to be increasingly
embittered and alienated at the continuing deterioration of
its standard of living. Nazarbaev warned, for example, that
if governors fail to ensure that wages and pensions are paid
on time, their own staff will receive their salaries only
after a similar delay.
	Nazarbaev's cautious approach to democratization is just
one aspect of his talent for strategic thinking. In his
"Kazakhstan -- 2030. Upswing, Security, and Permanent
Prosperity for All Citizens of Kazakhstan" program unveiled
in October 1997, Nazarbaev made it clear that he considers
preserving domestic political stability and the country's
territorial integrity, creating a professional government
apparatus and moving to stamp out corruption as necessary
preconditions for broad-based economic development that will
improve the living standard of the population at large.
Democratization did not figure among the seven key priorities
outlined in that program.
	But Nazarbaev is equally skilled as a tactician. One
year later, in October 1998, when the international community
was already focusing on the presidential election campaign,
he presented an amended list of "Five Keys" to Kazakhstan's
prosperity in the 21st century, which included
democratization and media freedom.
	How far, and how fast, Kazakhstan moves towards
democratization will depend to a large extent on the new
legislation on the various branches of power, and, assuming
that its powers are increased under that legislation, the
composition of the new parliament. It is unlikely, however,
that Nazarbaev will forfeit his prerogative of suspending the
country's cautious progress towards democratization in the
interests of preempting social upheaval.

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