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RFE/RL NEWSLINE Vol. 3, No. 169, Part I, 31 August 1999
___________________________________________________________ RFE/RL NEWSLINE Vol. 3, No. 169, Part I, 31 August 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 * SCANDAL CHARGES DENIED, CONFIRMED * FEDERAL FORCES BATTLE MILITANTS IN CENTRAL DAGHESTAN * KYRGYZ TROOPS HALT MILITANTS' ADVANCE xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx RUSSIA SCANDAL CHARGES DENIED... Boris Berezovskii, an oligarch close to President Boris Yeltsin, told Ekho Moskvy on 30 August that unless Moscow responds promptly to "false Western charges" about money-laundering, "all business in Russia will be represented as criminal," Interfax reported. He said that the scandal charges are being made by individuals both inside the country and beyond "who do not want Russia to be represented by its best components." Berezovskii concluded that those spreading such charges in the West include people "who are trying to obstruct" the construction of a democratic society in Russia. At the same time, he added that "there is no law that bans a Russian citizen, including the president, from holding accounts in foreign banks." PG ...CONFIRMED... Georgii Chuglazov, the federal prosecutor who was removed from the Mabetex case last week, told Interfax on 30 August that "at least 90 percent of published material [about the case] is true, and investigators have the documents to support this." Various media outlets have reported that Mabetex paid $1 million into an account held in Yeltsin's name and paid off his daughters' credit card balances. Meanwhile, Aleksandr Lebedev, the president of Russia's National Reserve Bank and deputy head of the Our Home Is Russia movement, told Interfax that reports about money-laundering through the Bank of New York are probably true, although he said claims that IMF money was laundered through that bank are "absolutely false." PG ...AND MINIMIZED. IMF director Tom Dawson told journalists in Washington on 30 August that there is "absolutely no evidence" that any IMF funds were diverted through the Bank of New York. Former Russian Prime Minister Viktor Chernomyrdin also downplayed the charges. In comments to "Moskovskii komsomolets" on 30 August, he said: "You can steal anything. But how do you steal an IMF loan?... It's improbable." Mikhail Khodorkovskii, a Russian industrialist who ran a bank now under investigation, said on Ekho Moskvy on 30 August that U.S. law enforcement agencies made a mistake because it is highly unlikely that Russians could move the amounts of cash specified during that period. And in an interview with "Newsweek", U.S. Deputy Secretary of State Strobe Talbott said "Calm down world" when he was asked about crime and corruption in Russia, adding that those phenomena have been known to Washington for a long time and will take "decades" to overcome. PG SCANDAL REPORTING DRIVES MOSCOW MARKET DOWN. The charges and countercharges concerning money-laundering and other corrupt activities have driven the Russian stock market down, Interfax reported on 30 August. Most issues were off 3-7 percent on a volume of 170 million rubles ($6 million). Aleksandr Korchagin, an analyst at a Moscow brokerage, said the scandal could lead to a suspension of IMF lending to Russia. PG RUSSIAN BUSINESSMEN IN U.S. SEEK TO AVOID EXPULSION. Some 13 Russian businessmen and their families have filed suit to avoid expulsion from the U.S. as a result of recent changes in U.S. immigration law, ITAR-TASS reported. Their lawyers said that they were participating in a "secret program" that allowed Russian and other immigrants who invest significant amounts of money in the U.S. to remain. One of their lawyers added that the 13 Russians have invested more than $20 million in the U.S. PG MOSCOW PREDICTS TAXES TO FALL, REVENUES TO GROW. Tax collections will decline by more than 59 billion rubles ($2.3 billion) in 2000, but state revenues will increase as a result of tax simplification and better collection efforts, the government told the State Duma, ITAR-TASS reported on 30 August. As a result, Moscow will be able to meet IMF targets and also increase social spending. But the Central Bank of Russia has cast doubt on one of the key assumptions of the budget now being considered by the parliament. A spokesman for the bank told Interfax on 30 August that the ruble will fall below the 32 to the dollar rate on which the budget numbers are based. He added that the government's prediction is already having a negative impact on the economy because firms are purchasing and holding hard currency as a result of uncertainties. PG MOSCOW TO TREBLE COAL INDUSTRY FUNDING. After a 30 August meeting with President Boris Yeltsin, Prime Minister Vladimir Putin told ITAR-TASS that Moscow will triple funding for the country's troubled coal industry over the next year. He said that Yeltsin specifically called for the involvement of mining unions in the disbursement of these funds. PG STEPASHIN VIEWS PUTIN AS PLAUSIBLE PRESIDENTIAL CANDIDATE. Former Prime Minister Sergei Stepashin said on RTR television on 29 August that he believes his successor, Vladimir Putin, is credible as a candidate for president next year, Interfax reported. "Putin is a strong political figure who has gotten off to a good start," Stepashin said, repeating his view that the current prime minister behaved "flawlessly" in his handling of Daghestan. PG COMMUNISTS AIM FOR BROAD ELECTORAL BLOC. Communist Party leader Gennadii Zyuganov told journalists in Moscow on 30 August that the KPRF will participate in the upcoming parliamentary elections as part of a "broad people's patriotic bloc, 'For Victory,'" Interfax reported. He said that this union will be an "association of the country's citizens rather than a group of two or three public and political organizations." And he added that "respected leaders and people famous in this country" will join it. Zyuganov criticized Agrarian Party leader Mikhail Lapshin for joining the Fatherland-All Russia bloc and suggested that "Lapshin is not the whole Agrarian Party." PG PRESS MINISTRY WARNS ORT ABOUT CAMPAIGN COVERAGE. The new Russian Ministry for the Press warned ORT television on 30 August that it could be stripped of its broadcasting license for abusing "freedom of the mass media," ITAR-TASS reported. Minister Mikhail Lesin issued the warning after ORT aired footage of a mass demonstration by supporters of the Right Cause bloc in St. Petersburg. The minister insisted that this was not a question of censorship but simply of respecting existing legislation. PG FEDERAL FORCES BATTLE MILITANTS IN CENTRAL DAGHESTAN. Backed by helicopters and armored vehicles, Russian federal forces and Daghestani Interior Ministry troops launched ground and artillery attacks on 30 August against some 300-500 guerrillas entrenched in the villages of Karamakhi, Chabanmahki, Kadar, and Durangi in Daghestan's Buinaksk Raion. Four Russian troops were killed in the fighting and 15 wounded. Four Karamakhi villagers were also killed. It is unclear how many of the "guerrillas" are members of the Chechen-led force that invaded Daghestan earlier this month and how many are devout Muslim residents of the villages in question, whom the Daghestani authorities have branded as "Wahhabis." Also on 30 August, Daghestan's Prosecutor-General Imam Yaraliev wrote to his Chechen counterpart to request the extradition of four residents of Daghestan who helped organize the attack on the republic, Interfax reported. LF CHERKESS APPEAL TO YELTSIN TO RESTORE THEIR AUTONOMY. Supporters of defeated Karachaevo-Cherkessia presidential candidate Stanislav Derev have called on President Yeltsin to issue a decree on re-establishing the Cherkess Autonomous Oblast (abolished in 1957) and on prolonging the temporary appointment of Valentin Vlasov as head of executive power in the Republic of Karachaevo-Cherkessia until the new government of the Cherkess Autonomous Oblast is appointed, Caucasus Press reported on 31 August. Derev's supporters launched a protest demonstration on 27 August against the republican Supreme Court's ruling that the results of the 16 May presidential runoff are valid. According to official figures, ethnic Karachai Vladimir Semenov won more than 70 percent of the vote, while Derev, who is Cherkess, received only 20 percent. ITAR-TASS reported on 30 August that both Derev and Semenov proposed to Yeltsin a month ago that he defuse tensions in the North Caucasus by appointing Boris Berezovskii as presidential envoy to the region. LF CHECHEN PRESIDENT MOVES AGAINST UDUGOV, FIRES SECURITY CHIEF. Aslan Maskhadov issued a decree on 29 August removing Movladi Udugov from Chechnya's National Security Council, Interfax reported. Presidential spokesman Selim Abdumuslimov said that Udugov "became a member of a large-scale ideological sabotage operation against the Chechen state" and "pushed the traditional friendship between the Daghestani and Chechen peoples to breaking point." Udugov is believed to be allied with Chechen field commander Shamil Basaev, who coordinated the incursion into neighboring Daghestan earlier this month. ITAR-TASS reported on 31 August that Russian specialists have inactivated Udugov's Web site, which Daghestan Defense Ministry sources claim he used to spread false information about the Russian military operations against Chechen-led militants in Daghestan. On 30 August, Maskhadov also fired Ibragim Khultygov as National Security chief for concentrating on the oil sector rather than ensuring his agency performed its proper function. LF MEETING OF NORTH CAUCASUS PRESIDENTS POSTPONED INDEFINITELY. A meeting of North Caucasus presidents in Magas, the new capital of Ingushetia, has been postponed indefinitely, Caucasus Press reported on 30 August, quoting a spokesman for Ingushetia's President Ruslan Aushev. The meeting was originally scheduled for 25 August and then postponed to 30 August. According to Aushev, Chechen President Maskhadov had planned to attend. The reasons for the postponement are unclear. LF YELTSIN NAMES FIVE HEROES IN DAGHESTAN OPERATIONS. President Yeltsin on 30 August presented five Hero of Russia awards, including three posthumously, to soldiers who showed particular gallantry and heroism in the recent Daghestani fighting, Russian agencies reported. The Russian leader said that "Russian troops and Daghestani civilians have manifested the utmost courage and heroism while defending Daghestani territory from guerrilla aggression." PG PUTIN SAYS RUSSIAN NUCLEAR WEAPONS GUARANTEE PEACE. Speaking at a ceremony marking the 50th anniversary of the detonation of the first Soviet nuclear weapon, Russian Prime Minister Putin said that Russian nuclear weapons remain "the guarantor of national security and global peace in the current geopolitical setting," Interfax reported on 30 August. He said that the explosion of the first Soviet nuclear weapon "blew to smithereens any plans for an atomic war against Russia," adding that "it is impossible to win a nuclear war." PG RUSSIAN GENERAL SAYS KOSOVAR PROTESTS WERE PLANNED. Lieutenant-General Nikolai Staskov, the chief of staff of Russian airborne units, told Interfax on 30 August that he is convinced that Kosovar protests against Russian peacekeepers in Orahovac were "a thoroughly-planned provocation." He said that he hopes that "reason will prevail and that our peacekeepers will enter Orahovac without incident." However, there was no progress reported toward that end on 30 August. PG RUSSIAN GAS PRICES DOUBLED THIS YEAR. Gasoline prices in the Russian Federation have increased by 111.9 percent since the start of 1999, the Russian Statistics Agency told Interfax on 30 August. PG RUSSIAN FAR EAST SEEKS JAPANESE INVESTMENT. The governors of Sakhalin, Primore, and Khabarovsk are scheduled to present a package of investment projects to Japanese officials in Tokyo on 31 August, Interfax reported. Their presentations are part of the intergovernmental Russian-Japanese commission on trade and economic and technological cooperation. Meanwhile, a Tokyo newspaper reported on 29 August that the Japanese government is considering a resumption of its loans to Russia, Reuters reported on 30 August. PG MOSCOW APPEALS FOR HELP IN SAVING BOLSHOI THEATER... The Russian Foreign Ministry has released a statement calling on other countries to respond to a UNESCO appeal to provide funds to reconstruct Moscow's Bolshoi Theater, ITAR-TASS reported on 30 August. The statement said that Moscow will not impose customs duties or other taxes on any contributions to this work. PG ...AND 'MIR.' Writing in the Berlin newspaper "Die Welt" on 30 August, Yurii Semenov, the president of the Russian Energiya concern, appealed to Germany and 25 other countries whose citizens have worked on the "Mir" space station to provide funding to keep it operational, ITAR-TASS reported. His appeal followed a statement by the last crew commander that the now unmanned craft may soon spin out of control. PG TRANSCAUCASUS AND CENTRAL ASIA ARMENIAN PREMIER OUTLINES PARLIAMENT'S TASKS. Vazgen Sargsian appealed to parliamentary deputies on 28 August to cooperate with the government in overcoming Armenia's current problems, Noyan Tapan reported on 30 August. Sargsian identified three factors contributing to those problems: "confusion" following the collapse of the USSR and the war with Azerbaijan; inappropriate policy decisions by previous governments; and the "criminal activities" of unnamed individuals whom he said should be brought to account. Sargsian proposed that the parliament appoint special commissions to assess controversial privatization deals and to supervise the implementation of credit programs. He also urged deputies to enact legislation on credits, audits, and the civil service. "Iravunk" on 27 August estimated that more than 100 of the 131 parliamentary deputies are either members of the Miasnutyun bloc, which unites Sargsian's Republican Party amd Karen Demirchian's People's Party of Armenia, or back the government's policies rather than risk falling out of favor with Sargsian. LF GEORGIA OPPOSES RUSSIAN PROPOSAL TO LIFT ABKHAZ SANCTIONS. Speaking in Tbilisi on 30 August at his weekly press briefing, President Eduard Shevardnadze strongly criticized Russian Border Guards commander General Konstantin Totskii's proposal that Moscow might unilaterally lift the "economic blockade" imposed on Abkhazia in 1996. That proposal, Shevardnadze said, is "unjustified" and exceeds the general's sphere of competence, Caucasus Press reported. Totskii had argued that Russia is entitled to take its own decisions regarding controls and restrictions on its borders. Shevardnadze claimed that the ban on allowing residents of Abkhazia to cross the border into the Russian Federation or Russian citizens from bringing goods into Abkhazia does not constitute a blockade, but rather economic sanctions. He added that such statements create tensions in bilateral relations. Georgian Border Guards chief General Valerii Chkheidze said any unilateral attempt by Russia to raise the blockade would violate bilateral agreements. In a 30 August statement, the Georgian Border Guard Service condemned Totskii's statement as directed against Georgia's sovereignty and territorial integrity. LF KAZAKH PRESIDENT REDEFINES ROLE OF STATE OIL COMPANY. Nursultan Nazarbaev has signed a new law detailing the status and duties of the state oil company KazakhOil, Interfax reported on 30 August. The law has not yet been published, but a spokesman for KazakhOil told Interfax that the company has approved its content. The law defines KazakhOil as a state company in which the state owns 100 percent of shares. It assigns KazakhOil the duty of monitoring the work of foreign oil companies operating in Kazakhstan to ensure they comply with Kazakh law and the terms of their contracts. And it includes a provision requiring all oil companies to engage the services of local companies to provide goods and services. LF KAZAKHSTAN DELAYS DECISION ON RESUMPTION OF PROTON ROCKET LAUNCHES. Kazakhstan has secured the indefinite postponement of a 30 August meeting between the Russian and Kazakh government commissions that assessed the damage caused by the July explosion of a Russian Proton rocket shortly after blastoff from the Baikonur cosmodrome, Interfax reported on 30 August, quoting Russian Space Agency Deputy Director Boris Ostroumov. Ostroumov said that Kazakh experts have found more debris from the rocket and sent it to Moscow to determine whether it is contaminated with toxic heptyl fuel. The government commissions were to have agreed at the 30 August meeting on lifting the Kazakh ban on further launches of Proton rockets from Baikonur. LF KAZAKHSTAN'S OPPOSITION POLITICIANS, PENSIONERS MARK CONSTITUTION DAY. Pensioners in Almaty gathered in the city's central square on 30 August, the anniversary of the 1995 adoption of Kazakhstan's Constitution, for their monthly demonstration to protest inadequate pensions, RFE/RL correspondents in the former capital reported. Opposition leaders Madel Ismailov (Workers Movement), Seydakhmet Quttyqadam (Orleu Party), and Ghaniy Qasymov (an independent presidential candidate who failed in his bid for that office earlier this year) took advantage of the public holiday to engage in electioneering, trying to persuade voters not to support the pro-presidential Otan (Fatherland) Party in the upcoming parliamentary poll. LF SECRET AMMUNITION CACHE DISCOVERED IN KAZAKHSTAN. Grenades, detonators, and two explosive devices have been discovered during the demolition of garages in Astana belonging to the Interior Ministry, ITAR-TASS reported on 30 August. It is unclear who owns the ammunition. LF KYRGYZ TROOPS HALT MILITANTS' ADVANCE... The office of Kyrgyzstan's President Askar Akaev issued a statement on 30 August saying that earlier that day Kyrgyz troops engaged the guerrillas who had seized control of several villages in Osh Oblast and taken several dozen hostages, thereby preventing the guerillas from advancing further into Kyrgyz territory. The fighting took place in the Chon-Alai district. Also on 30 August, General Bolot Djanuzakov, who heads the Defense and Security Department within the presidential administration, told journalists that Kyrgyzstan has lodged an official protest with Uzbekistan over Uzbek bombing raids the previous day over Chon-Alai and Batken Raions, in which several civilians were killed. The raids were intended to target the guerrillas. LF ...AS OFFICIALS PONDER OPTIONS. Kyrgyz Foreign Minister Muratbek Imanaliev said in Bishkek on 30 August that the Kyrgyz authorities are capable of localizing and neutralizing the guerrillas without outside help, Interfax reported. But the same day, Kyrgyzstan's First Deputy Prime Minister Boris Silaev met in Moscow with Russian Defense Minister Igor Sergeev to discuss the optimum tactics to use against the militants. In Almaty, Kazakhstan's acting Defense Minister Bakhytzhan Yertaev told Khabar News Agency that Kazakhstan will this week give Kyrgyzstan ammunition and some military hardware (but not armored vehicles) to combat the militant threat, Interfax reported. LF xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx Copyright (c) 1999 RFE/RL, Inc. 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