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RFE/RL NEWSLINE

RFE/RL NEWSLINE Vol. 3, No. 86, Part I, 4 May 1999


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RFE/RL NEWSLINE Vol. 3, No. 86, Part I, 4 May 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

* NO BREAKTHROUGH IN CHERNOMYRDIN-CLINTON TALKS

* GERASHCHENKO SAYS RUSSIA'S CREDITORS STALLING ON LONG-TERM
RESTRUCTURING

* FORMER ARMENIAN INTERIOR MINISTER DETAINED
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RUSSIA

NO BREAKTHROUGH IN CHERNOMYRDIN-CLINTON TALKS. Russian envoy
for Yugoslavia Viktor Chernomyrdin handed U.S. President Bill
Clinton in Washington on 3 May a letter from President Boris
Yeltsin containing proposals for resolving the Kosova crisis,
Interfax reported. After meeting with Clinton, Vice President
Al Gore, Secretary of State Madeleine Albright, and Deputy
Secretary of State Strobe Talbott, Chernomyrdin told AFP that
the negotiations were "very complicated." Clinton earlier
expressed readiness to discuss the composition of an
international peace force. He said that "we would be willing
to have a bombing pause" but added that "we would need
acceptance of the basic principles and at least the beginning
of withdrawal of Serbian forces." An unnamed senior U.S.
official told AFP that "the Russians have some further ideas
which we will continue to discuss with them," but he
predicted that "I expect these discussions will continue over
some days and weeks." FS

ROBERTSON SAYS MILOSEVIC IGNORES CHERNOMYRDIN. British
Defense Secretary George Robertson said in London on 4 May
that "while Mr. Chernomyrdin continues with his diplomacy--
and it's very commendable that he should [continue] trying--
there's nobody really listening to him in Belgrade," Reuters
reported. Robertson stressed that NATO wants Russia, Ukraine,
and other countries to be involved in a peace-keeping force.
The previous day in Paris, French President Jacques Chirac
said in an address to the nation that he sees "no reason to
change strategy." He added that "Milosevic's political will
remains the same. ...NATO must, therefore, pursue its
mission." Chernomyrdin is scheduled to meet with UN Secretary
General Kofi Annan on 4 May in New York. FS

IS THE RUSSIAN ECONOMY STABILIZING? Economics Minister Andrei
Shapovalyants told ITAR-TASS on 4 May that according to the
results of the first quarter of 1999, the Russian economy is
showing signs of stabilizing. The news agency quoted him as
saying that industrial production in March was 1.4 percent
higher than the previous year and that there was flat
movement in GDP, whereas a decline had been expected.
Earlier, the State Statistics Committee had reported on 28
April that industrial output was down 2 percent in the first
quarter, compared with the same period last year, while
agricultural output had slipped 5.4 percent and the volume of
retail trade 15.8 percent, Interfax reported. Overall output
in the five key branches of the Russian economy shrank 3.7
percent. The committee also reported that industrial
production in March had declined, rather than increased, by
1.4 percent. JAC

GERASHCHENKO SAYS RUSSIA'S CREDITORS STALLING ON LONG-TERM
RESTRUCTURING... Russian Central Bank Chairman Viktor
Gerashchenko told reporters on 3 May that although the
agreement recently reached with the IMF has given a green
light to talks with the London and Paris Clubs, the creditors
are willing to defer payments for 1999 and 2000 but are
refusing to talk about subsequent years. Gerashchenko
concluded, "This shows that they wish to keep us on a short
leash." JAC

...AS GKO PLAN FINALLY CONCLUDED. Gerashchenko added that
most foreign banks have finally agreed to the government's
plan for swapping the defaulted short-term treasury bonds
that they hold. The Finance Ministry announced on 30 April
that Russian investors exchanged 95.6 percent of the bonds
they held for new government securities, while foreign
investors swapped 88.5 percent of their bonds, Interfax
reported. Under the government's scheme, foreign investors
are offered 10 percent in cash, 20 percent in special
investment bonds, and 70 percent in new ruble-denominated
long-term government bonds for their old bonds, Oleg
Larichev, manager of Troika Dialog, told the RFE/RL Russian
Service's program "Delo i Dengi." Foreign investors will have
the right to buy shares in six "blue chip" Russian companies:
UES, Mosenergo, Irkutskenergo, Rostelekom, LUKoil, and
Norilsk Nickel, according to Larichev. JAC

RUSSIA, GERMANY SIGN ANTI-CRIME AGREEMENT. Russian Interior
Minister Sergei Stepashin and his German counterpart, Otto
Schily, signed an anti-crime agreement in Moscow on 3 May.
The accord provides for closer cooperation between law
enforcement bodies from the two countries, AFP reported.
Stepashin said that over the next three months, Russian and
German officials will jointly investigate "the methods used
by criminals to channel money out of Russia to Germany and
elsewhere, including operations through offshore zones."
Schily is scheduled to meet with Prime Minister Yevgenii
Primakov on 4 May to discuss other areas of Russian-German
cooperation, a government spokeswoman told ITAR-TASS.
Stepashin announced that Yeltsin plans to visit Germany in
June at the time of the scheduled G-8 summit in Cologne. It
will be his first visit abroad since February, when the
ailing president attended the funeral of Jordan's King
Hussein against his doctors' advice. FS

STEPASHIN CLARIFIES NEW DUTIES. In an interview with NTV on 2
May, summarized by Interfax the following day, Stepashin
attributed his surprise appointment as first deputy prime
minister to the need to strengthen control over the regions
(see "RFE/RL Newsline," 28 April 1999). Central to this
process, he said, will be the Interior Ministry, which he
will continue to head. Stepashin also noted the need to
prevent "criminal elements" from coming to power in regional
elections. He expressed concern at violence in the Republic
of Karachaevo-Cherkessia, where a presidential runoff is
scheduled for 16 May (see "RFE/RL Newsline," 26 April 1999).
Stepashin said he has written to Chechen President Aslan
Maskhadov advocating the resumption of cooperation between
the Chechen and Russian Interior Ministries. An agreement on
cooperation was reached earlier this year but torpedoed by
the 5 March abduction in Grozny of senior Interior Ministry
official Gennadii Shpigun. Stepashin said talks are under way
with Shpigun's kidnappers, who have demanded a ransom for his
release. LF

IS LUKASHENKA READY TO BE NUMBER TWO? Vladimir Putin,
Security Council secretary and Federal Security Service head,
told Russian Television on 2 May that in a Russian-Belarusian
state, Russia's president would lead while the president of
Belarus would serve as vice president. Putin added that while
the leaders of both countries want to unify, they are
reluctant to yield some of their state's sovereignty.
"Everything depends on the readiness of the unifying
countries to pass over to the new country and its
institutions a certain part of their sovereign rights and
powers," he said. After a recent meeting with Russian
President Boris Yeltsin, Belarusian President Alyaksandr
Lukashenka admitted that he has brought to Moscow an
ambitious, radical plan for unification between his country
and Russia, but he now "understands that Russia is not ready"
yet (see "RFE/RL Newsline," 29 April 1999). JAC

RECENTLY SACKED CABINET OFFICIAL TO RUN FOR GOVERNOR. Vadim
Gustov, who was dismissed from his post as first deputy prime
minister on 27 April, will run for governor of Leningrad
Oblast in elections scheduled for 19 September, "The St.
Petersburg Times" reported on 30 April. According to the
daily, Gustov said "I said that I was ready to resign in
order to run for governor of Leningrad Oblast and the prime
minister agreed." Seven candidates have already announced
their intention to run, including acting Governor Valerii
Serdyukov, former St. Petersburg police chief Anatolii
Ponidelko, and Fedor Shkrudnev, former presidential envoy to
the oblast. Gustov's chances of victory are considered good
by local analysts. Leonid Kesselman, political analyst at the
Russian Academy of Sciences' Institute of Sociology, told the
daily that "Gustov is uncompromised in the eyes of the public
and most of the regional bureaucracy supports him." JAC

TOP DUMA OFFICIAL CHARGED WITH BRIBERY. The Prosecutor-
General's Office has charged Vladimir Trofimov, chief of
staff for the State Duma's Foreign Relations Committee, with
bribe-taking, Interfax reported on 30 April. Trofimov was
arrested by Federal Security Service officials on suspicion
of accepting a $5,000 bribe, "Segodnya" reported on 24 April
(see "RFE/RL Newsline," 26 April 1999). JAC

SPRING BRINGS NEW PATIENTS FOR LOCAL HOSPITALS. Although the
season for hunting wild mushrooms has only just started in
Stavropol Krai, eight cases of poisoning have already been
reported after ingestion of some local fungi, ITAR-TASS
reported on 4 May. Officials at the krai's Ministry of Health
blame the illnesses on violations of the unwritten rule of
any mushroom hunt: "If you don't know what it is, don't put
it in your basket." JAC

TRANSCAUCASUS AND CENTRAL ASIA

FORMER ARMENIAN INTERIOR MINISTER DETAINED. Vano Siradeghian
was taken into custody at Yerevan airport on 3 May on
returning from a three-month stay abroad, RFE/RL's Yerevan
bureau reported. He had left Armenia on 29 January, three
days after parliamentary deputies rejected a demand by
Prosecutor-General Aghvan Hovsepian to strip him of his
parliamentary immunity so that he could be questioned over
allegations that while serving as interior minister from
1992-1996 he ordered several murders. In a second vote on 17
February, deputies acceded to Hovsepian's request.
Siradeghian was re-elected chairman of the board of the
former majority Armenian Pan-National Movement (HHSh) at its
congress in early March (see "RFE/RL Newsline," 9 March 1999)
and has been nominated by that party as a candidate in the 30
May parliamentary elections. As such, he can be arrested only
with the consent of two-thirds of the 13 members of the
Central Electoral Commission. LF

AZERBAIJAN'S PRESIDENT TELEPHONES WITH TURKISH COUNTERPART.
Heidar Aliev, who is recuperating from heart bypass surgery
in the U.S., held a brief telephone conversation on 2 May
with Suleyman Demirel, who wished him a speedy recovery,
Turan reported the following day. A presidential press
spokesman described Aliev's condition as "good." LF

JAPANESE FOREIGN MINISTER VISITS AZERBAIJAN. Masahiko Komura
held talks in Baku on 2-3 May with his Azerbaijani
counterpart Tofik Zulfugarov and with Prime Minister Artur
Rasizade, ITAR-TASS and Turan reported. The Japanese side
agreed to extend a 18.3 billion yen (some $160 million) loan
toward the ongoing modernization of a key hydroelectric power
station on the Apsheron Peninsula and 1 billion yen to
renovate the country's road network. Agreement was also
reached on the opening of a Japanese embassy in Baku next
year. A Japanese spokesman said Tokyo may offer to finance
some sections of the TRACECA Asia-Europe transport corridor
and is interested in expanding its participation in
Azerbaijan's oil and gas sector. LF

AZERBAIJANI OFFICIAL HINTS AT FURTHER EXPANSION OF GUUAM.
Azerbaijani State Foreign Policy advisor Vafa Guluzade told
Turan on 3 May that Poland and Romania are interested in
joining the Georgia-Ukraine-Uzbekistan-Azerbaijan-Moldova
alignment in the near future. He added that GUUAM is expected
to intensify its activities and hold meetings with the heads
of state of countries that have expressed an interest in
membership. Talks are under way on the optimum location for
the organization's headquarters and the formation of its
Secretariat, Guluzade added. In related news, a delegation
from the Romanian Defense Ministry and military-industrial
complex visited Georgia last week to discuss areas of future
cooperation, Caucasus Press reported. LF

GEORGIAN STUDENTS PROTEST PLANNED U.S. EXHIBITS. Several
dozen Georgian students and members of the clergy are
continuing a hunger strike at several locations in Tbilisi to
protest plans to send priceless antique manuscripts and
Church treasures on a tour of four U.S. cities this fall,
Caucasus Press reported on 3 May. AP had quoted one of the
protest participants as predicting that the valuables would
be clandestinely sold to private collectors and replaced with
fakes. LF

KAZAKH JOURNALISTS CRITICIZE DRAFT LAW ON MASS MEDIA. Meeting
in Almaty on 3 May to mark International Media Day,
journalists subjected Kazakhstan's new draft law on mass
media to harsh criticism, RFE/RL correspondents in the former
capital reported. They charged that unless unspecified
drastic amendments are made to that draft, freedom of speech
and the press in Kazakhstan will be restricted. It is not
known who prepared the draft law, which was published in the
press last week but has not been distributed to parliamentary
deputies for discussion. LF

KYRGYZ, UZBEK TRAIN TRANSIT RESUMES THROUGH KAZAKH TERRITORY.
The heads of Kazakhstan's and Uzbekistan's national railroad
companies have reached an agreement on the resumption of rail
traffic from Kyrgyzstan and Uzbekistan across Kazakh
territory, RFE/RL's Kazakh Service reported on 4 May.
Kazakhstan had halted rail freight shipments from Kyrgyzstan
in mid-April and from Uzbekistan one week later because of
unpaid transit debts amounting to $3.8 million and $8
million, respectively (see "RFE/RL Newsline," 23 April 1999).
Those debts will now be repaid by 31 May. LF

KYRGYZSTAN'S INDUSTRY UNABLE TO REPAY DOMESTIC, FOREIGN
LOANS. Kyrgzystan's industrial sector owes the government
some 403 million soms (about $11 million) in domestic loans
and an additional 4.367 billion soms (about $125 million)
made available in foreign credits, RFE/RL's Bishkek bureau
reported on 3 May quoting government sources. Two-thirds of
the 105 enterprises that received foreign loans during the
period 1992-1998 are now on the verge of bankruptcy. LF

TAJIK COMMANDER RELEASES ANOTHER HOSTAGE. Mansur Muakalov,
whose fighters seized six Tajik police officers on the night
of 27-28 April to demand the release of five of their
associates under investigation for murder, handed over a
fourth hostage late on 2 May, AP reported from Dushanbe the
following day. Talks are continuing on the release of the two
remaining captive policemen. LF

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