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RFE/RL NEWSLINE Vol. 3, No. 136, Part I, 15 July 1999
________________________________________________________ RFE/RL NEWSLINE Vol. 3, No. 136, Part I, 15 July 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 * SWISS PROSECUTORS TAKING UP WHERE SKURATOV LEFT OFF? * OIL PRICE RISE TRIGGERS FEARS OF HIGHER FUEL PUMP PRICES * KAZAKHSTAN, RUSSIA REACH AGREEMENT OVER BAIKONUR LAUNCHES xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx RUSSIA SWISS PROSECUTORS TAKING UP WHERE SKURATOV LEFT OFF? Prosecutors in Geneva, Switzerland, have opened a criminal investigation into allegations of money-laundering against Kremlin facilities directorate head Pavel Borodin and other Russian citizens, AP reported on 14 July, citing an anonymous Swiss judge. According to a Geneva-based newspaper that day, these citizens include Borodin's wife and other members of the Russian presidential administration. According to "The Moscow Times" on 15 July, most Russian press organs are steering clear of the story, with only NTV providing coverage during its evening news broadcast on 14 July. On 15 July, Interfax carried only Borodin's categorical denial. He told the agency that "neither I nor my wife have any relationship with any Swiss bank accounts. I have not conducted any commercial or other types of activities on Swiss soil." Borodin's lawyer called the investigation a purely political action against the Russian president initiated by Swiss Prosecutor Carla del Ponte. Borodin's name has been linked with the Swiss firm Mabatex, which suspended Prosecutor- General Yurii Skuratov has been investigating. JAC OIL PRICE RISE TRIGGERS FEARS OF HIGHER FUEL PUMP PRICES. The price of gasoline has continued rising in regions across Russia. "Rossiiskaya gazeta" reported on 15 July that gasoline has all but disappeared in Arkhangelsk Oblast since 13 July and that during the first 10 days of this month, the price of oil products rose by 10- 15 percent in Belgorod, Orlov, Rostov Oblasts and by almost one-third in Tambov Oblast and the Republic of Dagestan. Also on 15 July, "Komsomolskaya Pravda" reported that prices for gasoline and diesel fuel increased in 70 regions across Russia last month and that the increase exceeded 15-20 percent in 47 of them. The newspaper concluded that Russian consumers should perhaps brace themselves for a 100 percent rise since the price of crude oil is rising and Russian producers will want to preserve the maximum amount of their output for export rather than refining. JAC GDP SLIDES IN FIRST QUARTER, AS GOVERNMENT MISSES BUDGET TARGET IN FIRST HALF. GDP sank by 2.9 percent in the first quarter of 1999, compared with the same period last year, according to the Russian Statistics Agency on 14 July. During the first six months of 1999, Russia recorded a primary budget surplus of 1 percent of GDP, Finance Minister Mikhail Kasyanov announced the same day. (The primary budget measure excludes debt payments.) Kasyanov predicted that the government will eventually meet the 2 percent primary budget surplus target agreed upon with the IMF. He noted that tax collection is increasing, having grown from 10 percent of GDP in January to 15 percent in June. JAC GOVERNMENT TO EXTEND GUARANTEES TO DOMESTIC INVESTORS... Russian President Boris Yeltsin has asked the government to prepare a new law providing guarantees for Russian investors against unfavorable changes in domestic legislation, Interfax reported on 14 July. The same day, a similar law protecting foreign investors came into force, Bloomberg reported. According to the agency, Mikhail Zadornov, presidential envoy to international financial institutions, said the World Bank wants the law in place before it releases new loans. On the issue of protecting domestic investors, Anton Danilov- Davidov, head of the presidential administration's economic directorate, told Interfax that the Economics Ministry may discuss amendments to the law on investment activity as early as 16 July. JAC ...AS FEDERAL SECURITIES COMMISSIONS CRACKS DOWN ON TRADING FIRMS. The Federal Securities Commission (FKTB) has pulled the trading licenses of more than 200 companies, "Vremya MN" reported on 13 July. FKTB Chairman Dmitrii Vasiliev told reporters that the firms were not observing basic rules, such as maintaining up-to-date financial records. According to Vasiliev, the commission has provided the Interior Ministry with a list of more than 99 investment funds suspected of other violations. Vasiliev also criticized the Central Bank for its bond issues, saying that they should be limited as much as possible, according to ITAR-TASS. JAC ZHIRINOVSKII'S LATEST GUBERNATORIAL CAMPAIGN HITS A BUMP. The Sverdlovsk Oblast Election Committee rejected all 30,000 signatures collected to support Liberal Democratic Party leader Vladimir Zhirinovskii's candidacy for governor of the oblast, "Segodnya" reported on 14 July. After losing his bid to run for governor of Belgorod Oblast, Zhirinovskii announced that he would seek the governor's office in both Leningrad and Sverdlovsk Oblasts (see "RFE/RL Russian Federation Report," 16 June 1999). According to "Segodnya," Zhirinovskii's supporters believe that they can gather another 30,000 signatures before the commission's deadline. Elections are scheduled for 29 August. JAC NIZHNII REFORMERS' PAST UNDER SCRUTINY. The Prosecutor- General's Office has launched a criminal investigation into former First Deputy Prime Minister and ex-Nizhnii Novgorod Governor Boris Nemtsov for possible violations of campaign finance laws during his 1993 Federation Council bid, "Tribuna" reported on 15 July. Meanwhile, "Obshchaya gazeta" in its 1-7 July issue examined former Premier Sergei Kirienko's activities at the Garantiya Bank in Nizhnii Novgorod. The newspaper claims that Kirienko "launched his career bilking old people" and describes how under his leadership the bank diverted monies from the oblast Pension Fund. Among the methods used were withholding dividends to the fund, which was the bank's main shareholder, and engaging in various schemes with promissory notes that, "according to certain calculations," made up to $10 million a month. The newspaper also describes how the bank concluded an information-processing contract worth 14.9 billion old rubles for "17 pages of text paraphrasing newspaper articles." One of the two companies involved, AMK Concern, was owned and managed by Kirienko. JC/JAC RUSSIAN GOVERNMENT APPOINTS YUGOSLAVIA AID COMMISSION. An unnamed official at the Russian Economics Ministry told Interfax on 13 July that the government has decided to create a commission to administer aid to Yugoslavia. Prime Minister Sergei Stepashin will chair the body, but Economics Minister Andrei Shapovalyants will be in charge of coordinating that aid among various Russian ministries and departments. FS YUGOSLAV AMBASSADOR UNSATISFIED WITH RUSSIAN KFOR ROLE. Yugoslav Ambassador to Russia Borislav Milosevic told ITAR- TASS on 14 July that he is "dissatisfied" with the level of Russian participation in the Kosova peacekeeping force (KFOR). Milosevic acknowledged that the "Russian troops are in [Kosova] not in order to protect the Serbs, but in order to treat everybody objectively." He added: "I do not think that ordinary Albanians are against the Russian contingent.... Anti-Russian actions by...Albanians are inspired by NATO in order to create an uneasy situation for the Russian peacekeepers." Milosevic, who is the brother of Yugoslav President Slobodan Milosevic, said: "I cannot speak about the significance of [anti-government protests in Serbia].... I do not consider them a major political factor." He stressed that "naturally, there is discontent in Yugoslavia and some are using it. But these are not the forces whom the people trust." FS ORTHODOX CHURCH OBJECTING TO ACTIVITIES OF OTHER RELIGIOUS GROUPS IN FAR EAST. The Russian Orthodox Church diocese in Vladivostok has asked the office of the Primorskii Krai prosecutor to examine the activities of three religious organizations operating in the krai, Interfax-Eurasia reported on 14 July. The diocese believes the groups have violated the controversial 1997 law on religion, under which local authorities may ban a religious organization. According to AP, the church has accused the Jehovah's Witnesses, Seventh Day Adventists, and a splinter group of Hare Krishnas of recruiting potential converts illegally by "using deception and totalitarian methods." According to the agency, the Orthodox Church objects to the practice of the Jehovah's Witnesses of visiting people in their homes, approaching them on public transportation, and compiling lists of all residents in neighborhoods where the group is active. A Moscow city prosecutor is currently seeking to ban the Jehovah's Witnesses in the capital (see "RFE/RL Newsline," 8 March 1999). JAC FSB EXPELS U.S. AID WORKER FROM VORONEZH FOR SPYING. The Voronezh Regional Directorate of the Federal Security Service (FSB) recently expelled Justine Hamilton, a U.S. citizen, who had been living there for the past two years working on humanitarian assistance programs, "Izvestiya" reported on 15 July. According to the newspaper, Hamilton was the official representative to Voronezh of the state of Kansas. FSB officials suspect Hamilton of compiling classified information on defense enterprises in Voronezh. They also noted that she was particularly interested in the oblast's ecological situation. JAC NORTH OSSETIAN, INGUSHETIAN PRESIDENTS MEET. Aleksandr Dzasokhov and Ruslan Aushev have held talks in Dzasokhov's residence near Vladikavkaz on the two republics' combined efforts to combat crime and the process of repatriation of ethnic Ingush displaced persons forced to flee North Ossetia's disputed Prigorodnyi Raion during the interethnic violence of 1992, "Nezavisimaya gazeta" reported on 15 July. LF HAS RADICAL OPPOSITION NEUTRALIZED CHECHNYA'S PRESIDENT? "Nezavisimaya gazeta" on 15 July cited unnamed sources in Grozny as reporting that President Aslan Maskhadov has in effect been rendered powerless in a bloodless palace coup by former acting Prime Minister Shamil Basaev and field commanders Ruslan Gilaev and Khottab. The field commanders subsequently announced the creation of a Council for National Security, intended to function as the highest organ of state power. Both Maskhadov and his opponents are to sit on that council. Basaev and his supporters called for the creation of such a supreme body of state power in February during a standoff with Maskhadov (see "RFE/RL Caucasus Report," Vol. 2, No. 6, 10 February 1999). On 14 July, "Vremya MN" quoted former Chechen Foreign Minister Movladi Udugov as saying that "Islamic military detachments" intend to launch a campaign next year to liberate Nagorno-Karabakh, which he characterized as "Muslim territory," from Armenian occupation. LF TRANSCAUCASUS AND CENTRAL ASIA ARMENIAN PRESIDENT HOPES FOR FURTHER PROGRESS ON KARABAKH SETTLEMENT. Speaking in Warsaw on 14 July after talks with Polish President Aleksander Kwasniewski, Robert Kocharian expressed optimism at the prospects for resolving the Karabakh conflict, adding that Armenia and Azerbaijan are holding direct talks to this end, ITAR-TASS reported. The Azerbaijani presidential press service reported the same day that Azerbaijan's President Heidar Aliev will fly to Geneva on 15 July to meet there with Kocharian to discuss the conflict, Reuters reported. LF SUSPECT IN ARMENIAN LOCAL ELECTION VIOLENCE ARRESTED. Businessman Ashot Aghababian, whose campaign staff beat and opened fire at supporters of a rival candidate during the 11 July election for mayor of the Yerevan district of Ajapniak, was arrested on 14 July, RFE/RL's Yerevan bureau reported citing a statement by the Prosecutor-General's Office. Eight people were injured during the violence, and the poll results have been annulled (see "RFE/RL Newsline," 12 July 1999). LF AZERBAIJAN MARKS 30TH ANNIVERSAY OF ALIEV'S ELECTION AS CP FIRST SECRETARY. President Aliev visited an exhibit in Baku on 14 July pegged to the 30th anniversary of his election as First Secretary of the Central Committee of the Communist Party of Azerbaijan, Reuters reported. The exhibition was organized by Ramiz Mehtiev, a senior member of Aliev's presidential staff, who in the 1980s served as ideological secretary of the republican CP Central Committee. During the 13 years as Azerbaijani party boss, Aliev claimed to have minimized corruption and achieved spectacular growth of the previously stagnating economy. Press articles after his enforced retirement from the post of first deputy chairman of the USSR Council of Ministers in October 1987 cast doubts on those claimed successes. LF AZERBAIJANI PARTY LEADER PROPOSES POWER-SHARING WITH OPPOSITION. Speaking at a press conference in Baku on 15 July, Ihtiar Shirinov, who is chairman of the pro-government National Congress Party, proposed the creation of a government of national unity in which both the present leadership and unspecified opposition parties would be represented, Turan reported. Shirinov said such a body is needed in light of the serious problems Azerbaijan currently faces. Those problems include failure by the OSCE to propose an acceptable solution to the Karabakh conflict, continued arms deliveries to Armenia by Russia and China, Iranian claims to ownership of Azerbaijan's Caspian oil reserves, and the perceived readiness of France and the U.S. to recognize the self-proclaimed Republic of Nagorno-Karabakh. Among the tasks the new government should tackle, Shirinov listed the conduct of free and fair municipal and parliamentary elections and the adoption of programs to safeguard Azerbaijan's territorial integrity and sovereignty as well as to ease social and economic tensions. LF AZERBAIJAN COMMENTS ON IRANIAN DEMONSTRATIONS. Azerbaijan Popular Front Party chairman and former President Abulfaz Elchibey told Turan on 14 July that he believes that the student demonstrations in Tehran and Tabriz are a struggle against the present regime that will trigger a "national- liberation struggle" by Iran's ethnic Azerbaijani population by this fall. State Foreign Policy Adviser Vafa Guluzade characterized the protests as Iran's internal affair and the consequence of the policies pursued by the present Iranian leadership. Guluzade said he excludes the possibility that they were inspired by forces outside the country. LF KAZAKHSTAN, RUSSIA REACH AGREEMENT OVER BAIKONUR LAUNCHES. Following 10 hours of talks on 14 July with Kazakhstan's Prime Minister Nurlan Balghymbaev and President Nursultan Nazarbaev, Russian Deputy Prime Minister Ilya Klebanov told journalists in Astana that Kazakhstan has agreed to a resumption of rocket launches from the Baikonur cosmodrome, with the exception of Proton rockets. In return, Moscow agreed to pay $115 million for the lease of Baikonur, part in cash and part in barter goods, from August through November. The agreement paves the way for the launch of a supply ship to dock with the orbiting "Mir" space station. That launch will take place on 16 July, according to Reuters. Meanwhile, residents of the village in central Kazakhstan's Karaganda Oblast, where chunks of debris from the rocket landed, are demanding to be evacuated until the precise extent of the ecological damage caused by the explosion is determined, Interfax reported. LF TAJIK CURRENCY LOSES VALUE. Tajikistan's National Bank on 13 July succeeded in stabilizing the exchange rate for the Tajik ruble against the U.S. dollar, setting an official rate of 1,400 Tajik rubles to the dollar, "Izvestiya" reported on 14 July. The Tajik ruble had traded at 1,400 to the dollar at the beginning of the previous week before falling to 1,800- 2,000. The fall in the value of the national currency led to steep price rises. Speaking on national television, National Bank chairman Murodali Alimardonov and Finance Minister Anvarsho Muzaffarov both denied rumors that the Tajik government intends to introduce a new national currency--the somon--in September to mark the 1,100th anniversary of the Samanid dynasty. LF ANOTHER UZBEK HUMAN RIGHTS ACTIVIST SENTENCED... On 14 July, a court in Tashkent sentenced 48-year-old Mahbuba Kasymova to five years' imprisonment on charges of fraud and harboring a criminal. Human Rights Watch termed the three-hour trial "a farce." Kasymova is a member of the unregistered Independent Human Rights Organization of Uzbekistan and of the banned Birlik opposition party. Uzbek police arrested Ravshan Khamidov, who had been living with Kasymova's family in their Tashkent apartment since November 1998, on 12 May on suspicion of involvement in the 16 February Tashkent bombings. He has not yet faced trial on those charges. Two members of the Independent Human Rights Organization were arrested in June and a third died in custody (see "RFE/RL Newsline," 28 June 1999). LF ...AS TRIAL OF MORE BOMBING SUSPECTS BEGINS. Uzbekistan's Supreme Court opened proceedings on 14 July against 20 people suspected of involvement in the Tashkent bombings, AP reported. Six people were sentenced to death and a further 16 received prison terms ranging from 10 to 20 years in a trial that ended last month (see "RFE/RL Newsline," 29 June 1999). LF 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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