Some things have to be believed to be seen. - Ralph Hodgson
RFE/RL NEWSLINE

RFE/RL NEWSLINE Vol. 3, No. 172, Part I, 3 September 1999


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RFE/RL NEWSLINE Vol. 3, No. 172, Part I, 3 September 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

* BOMB SCARES CONTINUE IN MOSCOW

* MEDIA MINISTRY SUSPENDS ST. PETE TV COMPANY

* OSCE TO MONITOR PARLIAMENTARY ELECTIONS IN KAZAKHSTAN
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RUSSIA

BOMB SCARES CONTINUE IN MOSCOW. The Federal Security Service
(FSB) said on 2 September that it has not yet arrested all
those responsible for the 31 August bombing of the Manezh
shopping center, adding that telephone calls to the service
by the public have failed to give any real leads. Russian
agencies reported. But Interior Minister Vladimir Rushailo
took the unusual step of asking the press not to belabor
suggestions that the Chechens were behind the bombing,
Interfax said. Even as that investigation continued, a
suspicious-looking object thought to be a bomb was discovered
in a Moscow railroad station, but after the station was
evacuated, the authorities announced there had been a false
alarm. And in an apparently unrelated incident, a World War
II landmine was found and then removed from near a Moscow
Jewish school, Interfax reported. Caucasus Press on 2
September quoted AFP as reporting that the self-styled
Liberation Army of Daghestan has claimed responsibility for
the bombing and pledged to continue acts of terrorism in
Russian until all Russian forces are withdrawn from
Daghestan. PG/LF

MORE CHARGES, DENIALS IN SCANDAL STORY. The Bank of New York
money-laundering scandal continued to reverberate through the
Russian media as well as among Russian politicians. Russian
Interior Minister Rushailo said the money-laundering scandal
was political in both Russia and the U.S., Interfax reported
on 2 September. Federation Council Speaker Yegor Stroev
echoed his words, saying that the scandal reflects American
politics more than the campaigns in Russia itself, ITAR-TASS
reported. Meanwhile, former Prime Minister Sergei Kirienko
said that the scandal is about theft rather than economics,
adding that if crimes are uncovered, "steps must be taken, if
[those crimes are] unconfirmed, apologies must be made." And
Russian prosecutors said they may soon send a team to New
York to expand their investigations. PG

U.S. WILL BACK MORE IMF LOANS TO RUSSIA, ITAR-TASS SAYS. The
Russian news agency reported on 2 September that an anonymous
U.S. Treasury Department official has said that Washington
will continue to back IMF loans to Russia and that it is not
going to block a future IMF tranche to Moscow. That comment
comes on the heels of a statement by Treasury Secretary
Lawrence Summers, who said Washington will not back more
loans until there is "an adequate accounting" of how earlier
monies have been spent. PG

FSB DIRECTOR SEES 'NO GROUNDS' FOR EMERGENCY RULE. Nikolai
Patrushev told "Nezavisimaya gazeta" on 2 September that
"there are no grounds" for introducing a state of emergency"
in Russia. PG

MEDIA MINISTRY SUSPENDS ST. PETE TV COMPANY. Mikhail Lesin,
the minister who oversees the media in Russia, on 2 September
lifted the license of Petersburg Television after the latter
broadcast a program that he said was pre-election propaganda,
ITAR-TASS reported. The program had first appeared on Russian
Public Television, for which ORT had received a warning from
the ministry (see "RFE/RL Newsline," 31 August 1999). Lesin
said the station will get its license back if it submits a
written explanation of why and how it broadcast the offending
program and what steps it has taken to prevent a repetition,
Interfax noted. PG

ZADORNOV RESIGNS AS SPECIAL ENVOY TO INTERNATIONAL FINANCIAL
ORGANIZATIONS. Mikhail Zadornov, President Boris Yeltsin's
special envoy to the IMF and other financial organizations,
told a Moscow press conference on 2 September that he is
resigning from that post and will run for the Duma as part of
the Yabloko movement. He said that he leaves the position
satisfied with Moscow's work in implementing the IMF program
but added that he believes he can do more for the country in
politics. PG

RUSSIAN RUBLE FALLS, GDP DOWN, BUDGET DEFICIT STABLE. The
Russian ruble fell to 25.87 against the dollar, Russian news
agencies reported on 2 September. That was a record low for
the Unified Trading Session, Interfax said, surpassing the
rate of 25.29 to $1 registered on 9 August. Interfax experts
said that a $400 million drop in Russia's gold and hard-
currency reserves from 20-27 August had limited the ability
of the Central Bank to intervene in the currency markets.
Meanwhile, the Russian Statistics Agency said Russia's GDP
shrank by 1 percent in the first half of 1999, compared with
the same period the previous year. And the federal budget
deficit was 45.5 billion rubles ($1.8 billion) for the first
six months of 1999, compared with 46.2 billion in the same
period of 1998. PG

STROEV SAYS BUDGET TO BE SIGNIFICANTLY REVISED. Federation
Council Speaker Stroev told Interfax on 2 September that the
parliament will significantly revise the government's draft
budget. He suggested that there will have to be more money
for agriculture and the military, among other changes. PG

ANTI-WESTERN ATTITUDES FADE IN RUSSIA. Yurii Levada, the
director of the VTSIOM public opinion research center, told a
Moscow press conference on 2 September that the wave of anti-
Western feelings that were provoked by NATO's campaign in
Kosova are now fading, Reuters reported. In March, 49 percent
of Russians thought "badly" or "very badly" of the U.S.,
Levada said, while in August, 49 percent had a positive
attitude and only 32 percent a negative view. PG

U.S. NOT TO TIGHTEN IMMIGRATION POLICIES. Interfax reported
on 1 September that US Consul General in Moscow Laura Clerici
said Washington has no plans "to toughen" its immigration
policies toward Russia as a result of the scandal over
"Russian money-laundering" there. Clerici added that 11,000
Russians emigrated to the U.S. in 1998, and she added that in
her estimation, most Russian emigrants are "quite law-
abiding." PG

POLL FINDS PRIMAKOV NOT INCREASING FATHERLAND BLOC
POPULARITY. Former Prime Minister Yevgenii Primakov's
decision to join the Fatherland-All-Russia electoral bloc has
not led to the increased popularity some had expected,
according to a poll conducted by the All-Russian Public
Opinion Center and reported by Interfax on 3 September. PG

STEPASHIN IMPLIES HE WON'T RUN FOR PRESIDENT NEXT YEAR.
Former Prime Minister Sergei Stepashin told "Obshchaya
gazeta" on 2 September that he is "not running for the
[State] Duma symbolically, the way some election bloc leaders
are," but rather to serve out his term there "if fate does
not decree otherwise." While the last clause gives him an
escape hatch, his assertion that he plans to serve a full
term in the Duma would appear to rule out a run for president
in 2000. PG

LUZHKOV SAYS DEMOCRACY IMPOSSIBLE WITH MASSIVE POVERTY.
Moscow Mayor Yurii Luzhkov said that the creation of a
democratic state will be impossible in Russia as long as half
of the population lives below the poverty line, while 5-10
percent of the people account for 90 percent of the country's
wealth, Interfax reported on 2 September. He said that new
government policies could rectify the situation quickly. PG

GOVERNMENT OFFERS TO ASSUME MANAGEMENT OF SIDANKO DEBT. The
Russian Fuel and Energy Ministry and the Federal Service for
Financial Recovery and Bankruptcy have offered to assume
management of Sidanko's debts, Interfax reported on 2
September. But the offer does not include any guarantee of
repayment. PG

YELTSIN, LUCINSCHI AGREE ON TRADE PACT. Russian President
Yeltsin and his Moldovan counterpart, Petru Lucinschi, met in
Moscow on 2 September and signed a 10-year economic
cooperation accord. They also agreed to work toward a pact
that would hasten the implementation of the 1995 agreement on
Russian withdrawal from the Transdniester region, ITAR-TASS
reported. PG

MOVEMENT ON RAHOVEC? The Kosova Temporary Council, a
consultative body under the UN mission to Kosova, announced
on 2 September that it will dispatch international policemen
to Rahovec and decide "with the Russians what should be done
next," ITAR-TASS reported. This decision appears to defuse
somewhat the standoff between Russian forces and the
Albanians in Rahovec. PG

SERGEEV SAYS MOSCOW'S MILITARY TIES NOT AGAINST THIRD
PARTIES. Russian Defense Minister Igor Sergeev said in Seoul
on 2 September that Russia's military-technical ties with
other countries are in no way directed against third
countries, Interfax reported. At the same time, Sergeev said
that Moscow will work with South Korea to limit the impact of
North Korea's missile program. PG

MOSCOW DENIES SALE OF SUBMARINES TO CHINA. The Russian
Foreign Ministry told Interfax on 2 September that despite
press reports to the contrary, "no talks are being held or
could be held on the delivery of two Russian nuclear
submarines to China. This is an absolute falsehood." But
Rosvooruzhenie, the Russian state arms trading company,
refused to comment on the reports that had appeared in Hong
Kong the previous day. PG

MOSCOW PRESSES TEHRAN ON GUSINSKII VISIT. The Russian Foreign
Ministry on 1 September told Iran's ambassador to Moscow that
Moscow backs Russian Jewish Congress President Vladimir
Gusinskii's request for a visa to visit Tehran in order to
attend a trial there of 13 Iranian Jews charged with spying
for Israel, Interfax reported. PG

RUSSIAN BORDER GUARDS FIRE ON TAIWANESE SHIP. Russian border
guard units fired on a Taiwanese ship caught poaching near
the Kuril Islands, Interfax reported on 2 September. Later
the Russian guards boarded both boats and towed them into
port. Meanwhile, Russian fishermen lodged a protest against
the U.S. Coast Guard for its actions in limiting Russian
fishing in what they called their economic zone, Interfax-
Eurasia reported on 2 September. PG

RUSSIA TO SELL FIGHTER-BOMBERS TO ALGERIA. The Novosibirsk
Aircraft-building Association told Interfax on 1 September
that it will sell three Su-24 fighter-bombers to Algeria for
$12 million. The contract was arranged by the Promeksport
company. PG

RUSSIAN POPULATION SEEN DECLINING FURTHER. The population of
the Russian Federation declined by 406,200 during the first
six months of 1999, Interfax reported on 2 September, citing
a report by the Russian Statistics Agency. That decline has
led the agency to predict that the Russian population will
fall by 8 million by 2016. At present, every 100 Russian
women have only 124 children, 111 fewer than the rate needed
to keep the population stable. PG

KOMI REPUBLIC TO JOIN BARENTS SEA COUNCIL. A Finnish official
told Interfax on 1 September that the Barents Euro-Arctic
Council will admit the Republic of Komi at one of its future
sessions. The council, an intergovernmental body, currently
includes Denmark, Iceland, Finland, Norway, Sweden, and the
Russian Federation. PG

TRANSCAUCASUS AND CENTRAL ASIA

ARMENIA, KAZAKHSTAN PLEDGE TO BOOST ECONOMIC TIES. On a one-
day visit to Astana on 2 September, Robert Kocharian met with
his Kazakh counterpart, Nursultan Nazarbaev, to discuss
bilateral relations, Interfax and Noyan Tapan reported. Both
presidents noted that there are no outstanding political
differences between their countries but agreed on the need to
expand bilateral trade, which currently totals less that $1.5
million annually. Kocharian noted that Armenia could supply
food products and equipment to Kazakhstan, purchasing grain
and raw materials in return. He also said Armenia is
interested in gaining observer status within the Central
Asian Cooperation Organization. A friendship and cooperation
agreement and an agreement to establish a joint commission
for economic cooperation were signed during the visit. LF

AZERBAIJANI PRESIDENT WILLING TO AMEND LOCAL ELECTION LAW.
Meeting in Baku on 1 September with Gerard Stoudmann,
director of the OSCE Office for Democratic Institutions and
Human Rights, Heidar Aliev expressed willingness to accept
the OSCE's recommendations for amendments to the
controversial law on municipal elections, which opposition
parties claim is undemocratic. But Aliev predicted that
problems might occur during the municipal elections, which
are scheduled for 12 December. Azerbaijan parliamentary
speaker Murtuz Alesqerov told Stoudmann earlier that day that
the law takes account of recommendations by the OSCE and
other international organizations and complies with
international standards (see "RFE/RL Newsline," 2 September
1999). Also on 2 September, the political parties represented
in the Movement for Electoral Reform and Democratic Elections
said they will monitor the municipal elections, Turan
reported. LF

GEORGIAN MINISTERS MEET WITH CHECHEN VICE PRESIDENT. Minister
of State Vazha Lortkipanizde and Georgian Intelligence chief
Avtandil Ioseliani met on 31 August in Tbilisi with Chechen
Vice President Vakha Arsanov, who is recuperating in Tbilisi
from spinal surgery, Caucasus Press and Interfax reported on
2 September. The talks focused on allegations made by Arsanov
last week that Russian special services are recruiting
Chechens who will be sent to destabilize Georgia's Black Sea
autonomous republic of Adjaria in order to create a pretext
for Russian military intervention there. Arsanov said the
Chechen leadership will do all in its power to thwart those
plans. Speaking at a press conference in Batumi on 31 August,
Adjar Supreme Council Chairman Aslan Abashidze downplayed
Arsanov's statement, commenting that Russia has no interest
in destabilizing the situation in his republic, according to
Caucasus Press. LF

RUSSIAN FOREIGN MINISTER VISITS AZERBAIJAN. On the first leg
of a three-day tour of the South Caucasus, Igor Ivanov held
talks in Baku on 2 September with his Azerbaijani
counterpart, Tofik Zulfugarov, Prime Minister Artur Rasizade
and President Aliev. Ivanov tried hard to convince his
interlocutors that Russia "is taking very seriously criticism
of its Caucasus polices by the Azerbaijani leadership" and
wants to develop equitable relations with all three South
Caucasus states, according to Interfax. Aliev, for his part,
criticized Moscow's military cooperation with Armenia and the
failure of the OSCE Minsk Group, of which Russia is a co-
chairman, to make progress toward resolving the Karabakh
conflict. But Aliev characterized relations between the two
countries as "friendly," despite their disagreements.
Rasizade said relations with Russia "will remain a priority"
for Baku. LF

OSCE TO MONITOR PARLIAMENTARY ELECTIONS IN KAZAKHSTAN. Senior
OSCE official Linda Edgeworth told journalists in Almaty on 2
September that the organization will send a full mission to
monitor the parliamentary elections on 17 September and 10
October, Reuters and Interfax reported. The OSCE had declined
to send such a mission to monitor the January 1999
presidential elections on the grounds that the election law
did not create equal conditions for all candidates. Edgeworth
noted improvements to that law to ensure the accuracy of the
vote tally. But she expressed concern over the practice of
invoking administrative offenses to bar potential candidates
from running and over restrictions on freedom of speech.
Edgeworth stressed that sending an observers' mission does
not constitute approval of the conditions under which the
elections are held. LF

KAZAKHSTAN STILL PLANS TO SELL TENGIZCHEVROIL STAKE...
Chevron Oil Company President Richard Matzke told journalists
in Atyrau on 2 September that Kazakhstan's government has
informed Chevron of its intention to proceed with the planned
sale of part of its 25 percent stake in the Tengizchevroil
consortium, Interfax reported. That consortium was created in
1994 to exploit the country's largest oilfield. LF

...DESPITE GROWING OPPOSITION. Meanwhile, more senior Kazakh
officials have expressed reservations over the planned sale.
Uzaqbay Qarabalin, acting president of the state oil company
KazakhOil, whose predecessor Nurlan Qapparov was fired 10
days ago for opposing the sale, said on 2 September that the
sell-off is "shortsighted" and will weaken KazakhOil. At the
same time, he admitted that KazakhOil has no choice but to
bow to the government's decision (see "RFE/RL Newsline," 25
August and 1 September 1999). Marat Ospanov, chairman of the
lower house of the parliament, said that selling part of the
stake in Tengizchevroil is not the right way to solve
Kazakhstan's financial problems, according to Interfax on 2
September. He pointed out that the value of the 10 percent
stake in question may double within 2-3 years from the
present $1-1.5 billion. On 1 September, Kazakhstan's Energy,
Industry, and Trade Minister Mukhtar Ablyazov told Interfax
that the value of Kazakhstan's stake in Tengizchevroil is
likely to increase significantly. But he pointed out that the
country must repay about $900 million in foreign debts this
year. LF

KAZAKH OPPOSITION CLAIMS MORE STATE COMPANIES TO BE SOLD OFF.
Leaders of the Democratic Azamat (Freedom) Party told a press
conference in Almaty on 2 September that the planned sale of
part of Kazakhstan's stake in Tengizchevroil is only the
first step in what they termed the distribution of state
property among the ruling class, RFE/RL's bureau in the
former capital reported. Party chairman Ghalym Abelseitov
said government sources have informed him that the Aqtobe-
Munay and Aqtau-Munay oil companies, the Qazaq-Mys copper
smelter, the National Bank of Kazakhstan, and KazTeleCom will
also be put up for tender. LF

KAZAKHSTAN'S STATE PUBLISHING HOUSE REFUSES TO PRINT SOME
LOCAL NEWSPAPERS. Following last month's decision by the
Kazakh government to suspend financing most official
newspapers, the state publishing house in Almaty is refusing
to publish some local newspapers, RFE/RL correspondents in
the former capital reported on 2 September (see "RFE/RL
Newsline," 5 August 1999). Although some newspapers have
secured alternative sources of funding, they cannot find
another publisher. LF

KYRGYZ LEADERSHIP DISCUSSES HOSTAGE CRISIS. President Askar
Akaev chaired a meeting with power ministers on 2 September
to discuss how to deal with the threat posed by ethnic Uzbek
militants still holding some 13 hostages in southern
Kyrgyzstan. Akaev insisted that those hostages must be freed
unharmed. He ordered the army to set up road blocks to
prevent the militants advancing further north and charged the
government with providing all necessary assistance to
villagers who fled or have been evacuated. Also on 2
September, First Deputy Prime Minister Boris Silaev told
journalists in Bishkek that preparations are being made for a
protracted standoff with the guerrillas. Silaev, who held
talks in Moscow with Russian government officials earlier
this week, said that promised military hardware, including
planes and helicopters, will arrive in Kyrgyzstan soon. LF

KYRGYZ OFFICIALS DISCUSS DEBT RESTRUCTURING. Also on 2
September, Akaev met with a visiting U.S. delegation to
discuss strengthening bilateral economic ties, RFE/RL's
Bishkek bureau reported. The delegation also held talks with
Prime Minister Amangeldi Muraliev. At that meeting it was
disclosed that in 2000 Kyrgyzstan will have to meet foreign
debt repayments equal to 40 percent of the annual budget. The
lion's share consists of a $130 million Russian loan. Talks
are under way with the governments of Russian and Pakistan on
restructuring those loans. LF

TAJIKISTAN SETS DATE FOR PRESIDENTIAL ELECTIONS. Meeting on 3
September, Tajikistan's parliament scheduled presidential
elections for 6 November, AP and dpa reported. But AP noted
that the presidential poll may not take place if the
electorate votes in a 26 September referendum to endorse a
proposed amendment to the country's constitution that would
extend the presidential term from five to seven years.
Incumbent Imomali Rakhmonov was elected president in November
1994. LF
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