In the effort to give good and comforting answers to the young questioners whom we love, we very often arrive at good and comforting answers for ourselves. - Ruth Goode
RFE/RL NEWSLINE

RFE/RL NEWSLINE Vol. 3, No. 127, Part I, 30 June 1999


________________________________________________________
RFE/RL NEWSLINE Vol. 3, No. 127, Part I, 30 June 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

* CHERNOMYRDIN RETURNS TO GAZPROM

* FOUR MORE BANKS FALL

* ARMENIAN CATHOLICOS DIES
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RUSSIA

CHERNOMYRDIN RETURNS TO GAZPROM. Former Prime Minister Viktor
Chernomyrdin on 30 June was named chairman of the board of
Gazprom, the company that he earlier headed, AFP reported,
citing the company's press service. Press coverage leading up
to his expected election to the post predicted that
Chernomyrdin's return would have consequences not only for
the company but for the upcoming parliamentary and
presidential elections. According to "Novye Izvestiya" on 24
June, Gazprom head Rem Vyakhirev is reportedly inclined to
back the governor-led movements Vsya Rossiya (All Russia) and
Golos Rossii (Voice of Russia), which the Kremlin also wants
to back, but is wavering. Chernomyrdin, the newspaper argued,
has been installed to force Vyakhirev's cooperation on that
and a number of other issues. JAC

...JUST IN TIME FOR ELECTIONS. In an interview with "Delovoi
Vtornik" on 29 June, Perm Deputy Governor Igor Shubin said
the government's recent attempt to get the company to remit
its taxes only in real money is obviously part of a pre-
election struggle. "Several [parties] would like to enlist
Gazprom's powerful support during their campaigns," he added.
Commenting on the same issue, Konstantin Titov, the informal
leader of Golos Rossii and governor of Samara Oblast, told
the publication that "We all live on credit from Gazprom. We
pay our accounts poorly, trying to settle everything with
them by barter." He added that "any attempts at
reconstructing [the company] must be undertaken with extreme
caution, because breaking up the company quickly and easily
will only create new problems." JAC

FOUR MORE BANKS FALL... The Central Bank on 29 June announced
it is withdrawing the licenses of four large banks,
Oneksimbank, Mosbiznesbank, Promstroibank and Mezhkombank. A
senior banking expert told Interfax that the licenses were
pulled "under unprecedented pressure from the IMF and World
Bank, which were unwilling to hear any arguments." According
to the source, the Central Bank tried to persuade the
institutions' officials that the banks were nearing the
completion of restructuring. However, other Cabinet officials
failed to support the Central Bank's position. The decision
to pull Promstroibank's license comes only two weeks after
the Agency for Restructuring Credit Organizations announced
that it will devote its scarce resources to restructuring the
bank (see "RFE/RL Newsline," 22 June 1999). JAC

...AS SECTOR SEES SOME IMPROVEMENT. In a banking sector
survey published on 27 June, Interfax-Vremya reported that of
Russia's top 100 banks, 29 operated at a loss in the first
quarter. That is an improvement over last year, when 36 out
of the 100 were in the red. Individual depositors' trust in
banks is showing some signs of reviving, as ruble deposits of
individuals increased by 9 percent in the first quarter,
compared with the post-crisis period from August-December
1999. First Deputy Prime Minister Viktor Khristenko announced
that the government will establish a special working group
composed of experts from the Tax, Finance, and Interior
Ministries and Central Bank to prevent any abuse of power by
commercial banks with regard to customers' deposits and
mandatory budget payments to all levels of the government,
"Segodnya" reported on 23 June. JAC

GOVERNMENT CURBING DEFICIT SPENDING... Russia's federal
budget deficit during the first four months of 1999 at 26.2
billion rubles ($1.1 billion) was 7 percent lower than during
the same period the previous year, according to the Russian
Statistics Agency, formerly called the State Statistics
Committee, Interfax reported on 29 June. Revenues during the
same period were 12 percent higher, at 133.9 billion rubles,
while expenditures totaling 160.1 billion rubles were 44
percent lower. Foreign trade turnover dropped 28.5 percent as
exports slipped 10.3 percent and imports 46.9 percent.
Meanwhile, GDP in the first quarter was 3 percent lower
measured in constant prices, according to the statistics
agency. JAC

...AS OFFICIAL EXPLAINS HOW RUSSIA WILL PAY FOR KOSOVA. First
Deputy Prime Minister Khristenko told TV-Center on 27 June
that of the some $69 million required to support Russian
peacekeepers in Kosova, $36 million will come from the 1999
budget and $32 million from the 2000 budget. More
specifically, he noted that the funds will be taken from the
government's reserves, which "do not amount to that much,"
from a redistribution of budget items related to
international activities, and from non-budget sources in the
Ministries of Defense and Finance. When asked by the
interviewer whether the Kosova contingent will be funded from
sums set aside for state sector employees, Khristenko
answered "it certainly will." JAC

RUSSIA TO SEND MILITARY HARDWARE TO KOSOVA BY SHIP. Russian
Defense Minister Igor Sergeev said in Moscow on 29 June that
Russia will send most of its military hardware, including
armored vehicles, to Kosova by ship, Interfax reported. An
unnamed Russian navy official said that the first vessels
will leave Sevastopol on 10 July bound for Thessaloniki.
Meanwhile, State Duma Deputy Speaker Sergei Baburin and the
chairman of the Duma's Defense Committee, Aleksei Arbatov,
arrived in Belgrade on 29 June to assess conditions for the
deployment of Russian peacekeepers. The legislators are
scheduled to travel to Kosova on 30 June. Colonel-General
Georgii Shpak told "Vremya MN" of 29 June that 70 percent of
the Russian force in Kosova will come from elite airborne
troops and the remainder will be former soldiers. FS

ZHIRINOVSKII SAYS RUSSIA NEEDS TO BECOME A NATO MEMBER.
Liberal Democratic Party of Russia leader Vladimir
Zhirinovskii told senior researchers at the Moscow State
University on 29 June that NATO should "be forced to extend
its membership to Russia" and include Russians in its
military command, Interfax reported. NATO "must hear the
breath of Russian soldiers," he commented. Zhirinovskii also
proposed sending 10,000 Russian peacekeepers to Kosova rather
than the planned 3,600, arguing that "Serbia will pay for the
Russian army to stay on its territory and guarantee a
peaceful life to its population." Referring to next year's
Russian presidential elections he said voters "will have to
choose between democracy and dictatorship, that [means]
between dirt and blood." FS

KURDS IN MOSCOW COMMENT ON OCALAN DEATH SENTENCE. Some 300
Kurds gathered in Moscow on 29 June to burn the Turkish state
flag in protest at the death sentence handed down on
Kurdistan Workers' Party (PKK) leader Abdullah Ocalan,
Interfax reported. Speaking at the demonstration, Liberal
Democratic Party of Russia Chairman Zhirinovskii accused
former Premier Yevgenii Primakov of betraying Ocalan to the
Turkish authorities, which he predicted will commute the
death sentence for fear of reprisals by the PKK. A spokesman
for the National Liberation Front of Kurdistan in the CIS
told Interfax that any protests by Kurds living in CIS member
states would be held in conformity with the laws of those
countries. But he also warned that the front cannot guarantee
that such protests will not turn violent. In Tbilisi, the
opposition National Ideology Party of Georgia issued a
statement protesting the death sentence as "inhuman" and a
violation of international law and calling for Ocalan's
release, Caucasus Press reported on 30 June. LF

NEW TEACHERS' PROTESTS LAUNCHED. Around 1,500 teachers in
Borzinskii Raion in the Chita Oblast announced on 29 June a
protest action to demand payment of an 11-month salary
backlog, Interfax-Eurasia reported. The head of the oblast's
education workers union said that the teachers in
Sherlovogorsk are ready to block the railway to draw
attention to their plight. Meanwhile, in Sverdlovsk Oblast,
32 teachers spent the night in sleeping bags in front of the
local administration building to protest 12 months of unpaid
wages, ITAR-TASS reported on 29 June. The teachers said they
will camp in front of the building until they are paid in
full. On 17 June, the government ordered the transfer of 1.96
billion rubles ($81 million) to the regions to pay teachers'
wages over the summer holidays (see "RFE/RL Russian
Federation Report," 30 June 1999). JAC

YELTSIN, LUKASHENKA MAKING RETIREMENT PLANS? In the latest of
a series of articles picking up on speculation that the
Kremlin is working to keep Russian President Boris Yeltsin in
an executive position as head of a Belarus-Russia
confederation, "Segodnya" on 29 June argues that the union of
the two countries' armies presents the ideal vehicle for
strengthening such efforts. According to the daily, attempts
to unite Belarus and Russia have failed because of the
"complete incompatibility of the economies and administrative
systems of the two countries," but "joining the two slivers
of the former Soviet Army seems more promising." Defense
Minister Marshall Sergeev last week called for the command
systems of the two armies to be united (see "RFE/RL
Newsline," 25 June 1999). The daily asserted that Minsk's
reaction to this initiative is likely to be positive if only
because the presidency of Alyaksandr Lukashenka expires on 20
July 1999 under the old Belarusian Constitution and with it
much of his legitimacy. JAC

CHINA QUIETLY EXPANDING INTO RUSSIA? Scholars attending a
roundtable in Vladivostok on 28 June about the problems of
the Chinese emigrants to Russia concluded that the emigrant
Chinese population will constitute the second-largest
national Diaspora in Russia in the 21st century, Interfax-
Eurasia reported. Currently, around 2.5 million Chinese
reside within Russia's borders. In the opinion of the
scholars, none of whom was identified by name, China is
"quietly expanding into our country" because of the absence
of a well-thought-out migration policy. The next day, the
Russian Statistics Agency reported that the population of
Russia shrank by 265,800 or 0.18 percent during the first
four months of the year and totaled 146.1 million as of 1
May. That decline was considerably steeper than the 159,700
dip recorded during the same period last year. JAC

BEREZOVSKII ASKED TO RUN FOR DUMA FROM TULA. The Union of
Unemployed Engineers of the Tula Cartridge Factory has sent a
letter to business magnate Boris Berezovskii asking him
compete in the State Duma elections from the Tula Electoral
District No. 176, "Izvestiya" reported on 30 June. The
engineers believe that as a successful businessman and
effective manager, Berezovskii would be able to revive the
Tula economy and improve the lives of the oblast's residents.
So far, there has been no reply to the invitation.
"Izvestiya" points out that in the past, two prominent
political figures took advantage of similar invitations to
win election to the Duma from Tula Oblast: Aleksandr Lebed,
currently governor of Krasnoyarsk Krai, and Aleksandr
Korzhakov, former longtime bodyguard of President Yeltsin. JC

U.S. HOSTAGE RELEAESED IN CHECHNYA. Missionary Herbert Gregg
returned to Moscow on 29 June after Russian and Ingush
Interior Ministry troops secured his release, Russian
agencies reported. Gregg had been abducted in Makhachkala in
November 1998. Ingush President Ruslan Aushev said the
process of negotiating Gregg's liberation was similar to the
one used in earlier cases such as that of UN relief
coordinator Vincent Cochetel and Russian envoy Valentin
Vlasov. Aushev also said that operations are continuing to
secure the release of Russian Interior Ministry officials
Gennadii Shpigun, who was abducted in Grozny in March (see
"RFE/RL Newsline," 8 March 1999). LF

RUSSIAN, IRANIAN INTERIOR MINISTERS DISCUSS NORTH CAUCASUS.
Meeting in Moscow on 29 June, Vladimir Rushailo and Abdol
Vahed Musavi-Lari agreed to an exchange of data on
developments in the North Caucasus, Interfax reported.
Rushailo told journalists after the meeting that Tehran has
"a full understanding" of the problems in the region, which
he characterized in terms of criminal gangs operating under
religious slogans. Observers believe Saudi Arabia and
Pakistan are financing extremist Islamic groups operating in
Chechnya and Dagestan. LF

TRANSCAUCASUS AND CENTRAL ASIA

ARMENIAN CATHOLICOS DIES. Garegin I died in Echmiadzin on 29
June after a long struggle against cancer, RFE/RL's Yerevan
bureau reported. Garegin, who was born in Syria in 1932 and
studied theology there and in Oxford, was ordained bishop in
1964. He had served in Iran, the U.S., and Lebanon before his
election as Catholicos in April 1995. President Robert
Kocharian has canceled his participation in the World
Economic Forum in Salzburg, Noyan Tapan reported on 30 June.
Kocharian has decreed a three-day period of national mourning
from 6-8 July, the date set for Garegin's state funeral. LF

ARMENIAN PRESIDENTIAL SPOKESMAN CONDEMNS NAGORNO-KARABAKH
BUGGING. Speaking at a press briefing in Yerevan on 29 June,
Vahe Gabrielian said the installation of a surveillance
device in the office of the president of the unrecognized
Nagorno-Karabakh Republic is "disgraceful" and that those
responsible should be punished. He affirmed the support of
the Armenian president and leadership for Nagorno-Karabakh
President Arkadii Ghukasian, Noyan Tapan reported. LF

AZERBAIJANI INTELLIGENCE ACCUSES FORMER PARLIAMENTARY
SPEAKER. Azerbaijan's National Security Ministry issued a
statement on 28 June claiming that Rasul Guliev plans to
visit Iran next month with the aim of organizing acts of
terrorism directed against Azerbaijan's President Heidar
Aliev and other leaders, Turan reported. The statement added
that Guliev's business partner Sheri Shahnavaz, who is of
Iranian origin, traveled to Tehran in May to arrange Guliev's
visit with Iranian security services officials. Guliev, who
has lived in the U.S. since resigning as parliamentary
speaker in 1996, and Shahnavaz have both denied the
allegations. A secretary at the Iranian Embassy in Baku told
Reuters that the statement was "absolute lies." The
Azerbaijani National Security Ministry and Prosecutor-
General's Office accused Guliev last year of large-scale
embezzlement and planning a coup in Azerbaijan (see "RFE/RL
Newsline," 16 January 1998). LF

WORLD BANK APPROVES NEW CREDITS FOR GEORGIA. The World Bank
on 9 June approved a $114.9 million credit to finance four
projects in Georgia, dpa and Caucasus Press reported. The
first $60 million tranche, to be released on 1 July, is to
support structural reforms, including privatization. The
remaining credits of $16.5 million, $25 million, and $13.4
million are earmarked for support for private sector
development, public sector reform, restructuring of Georgia's
hospitals, encouraging investment in the energy sector, and
judicial reform. LF

UKRAINIAN FOREIGN MINISTER VISITS TBILISI. Boris Tarasyuk
held meetings in Tbilisi on 28-29 June with President Eduard
Shevardnadze, Minister of State Vazha Lortkipanidze, senior
energy sector officials and his Georgian counterpart, Irakli
Menagharishvili, Caucasus Press reported. Speaking at a joint
press conference on 29 June, Menagharishvili said they had
discussed the entire spectrum of bilateral relations and
reached "complete understanding" on all issues. Tarasyuk
repeated Kyiv's willingness to participate in resolving the
Abkhaz conflict, offering to supply peacekeepers to serve
under the aegis of the UN or OSCE. He added that Ukraine may
participate in the economic reconstruction of Abkhazia once a
formal settlement of the conflict is reached. Tarasyuk also
unveiled proposals for creating special coordinating bodies
in each of the GUUAM member states to enhance the
effectiveness of that alignment, according to "Nezavisimaya
gazeta" on 30 June. LF

KAZAKHSTAN'S FOREIGN MINISTER IN MOSCOW. On an official visit
to Moscow on 28-29 June, Kasymzhomart Toqaev met with top
Russian government officials, including Prime Minister Sergei
Stepashin and Foreign Minister Igor Ivanov. Talks focused on
all aspects of bilateral cooperation, and both Toqaev and
Ivanov said progress was made toward resolving outstanding
problems. Specifically, Toqaev noted that talks are
continuing on the delimitation of the Russian and Kazakh
sectors of the Caspian Sea on the basis of an agreement
signed 11 months ago by Russian President Boris Yeltsin and
his Kazakh counterpart, Nursultan Nazarbaev. Under that
agreement, the seabed is divided into national sectors while
the waters remain the common property of all littoral states.
Toqaev said talks on the Baikonur space complex were likewise
"positive" and focused on an inventory of its property and
social guarantees for its employees. Under a 1998 agreement,
Moscow agreed to pay $115 million annually for the use of the
Baikonur complex. LF

KAZAKHSTAN'S BORDER GUARDS SUBORDINATED TO NATIONAL SECURITY
MINISTRY. President Nazarbaev has signed a decree
transferring the country's border troops from the Ministry of
Defense to the Ministry of National Security, RFE/RL
correspondents reported from Astana on 30 June. LF

KAZAKH NEWSPAPER RESUMES PUBLICATION. The independent
Russian-language weekly "Nachnem s ponedelnika" has resumed
publication in Almaty after being forced to close
temporarily, RFE/RL correspondents in the former capital
reported on 30 June (see "RFE/RL Newsline," 25 June 1999).
Following a letter from Minister of Information and Social
Accord Altynbek Sarsembaev to the Almaty City Prosecutor's
Office, the Almaty City Court's decision to freeze the
newspaper's bank account has been rescinded. LF

RUSSIA SAYS TAJIK OPPOSITION JEOPARDIZING PEACE PROCESS.
Russian Foreign Ministry spokesman Vladimir Rakhmanin
expressed concern on 29 June at what he termed increasingly
frequent attempts by the leadership of the United Tajik
Opposition to present ultimatums to the government, including
on issues not covered in the 1997 peace agreement, ITAR-TASS
reported. He said only "full compliance" with that agreement
can guarantee a "comprehensive" settlement and provide for
stability in Tajikistan. UTO leader Said Abdullo Nuri warned
on 26 June that he may resign as chairman of the Commission
for National Reconciliation because of the Tajik leadership's
ongoing refusal to appoint opposition field commander Mirzo
Zieyev to the post of defense minister (see "RFE/RL
Newsline," 28 June 1999). LF

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