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RFE/RL NEWSLINE Vol. 3, No. 206, Part I, 21 October 1999
___________________________________________________________ RFE/RL NEWSLINE Vol. 3, No. 206, Part I, 21 October 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 * COMMUNISTS PUSH BUDGET NEGOTIATIONS DOWN TO THE WIRE * PUTIN IN NORTHERN CHECHNYA * U.S. DIPLOMAT ADVOCATES ARMENIAN-TURKISH RAPPROCHEMENT End Note: MUCH ADO ABOUT UNITY xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx RUSSIA COMMUNISTS PUSH BUDGET NEGOTIATIONS DOWN TO THE WIRE. State Duma deputies voted on 20 October to postpone a vote on the draft 2000 budget until 22 October. Before making that decision, the Communist Party, which has the largest faction in the Duma (129 out of 450 seats), announced that it will reject the budget. The document needs 226 votes to pass. The Communists are insisting that revenues be raised again. However, Credit Suisse First Boston economist Vladimir Konovalev told AFP that the government is "already at the limits of what's credible or believable as far as the international community is concerned." First Deputy Prime Minister Viktor Khristenko warned that if the Duma does not pass the budget on 22 October, then there is no chance Russia will have a budget before the beginning of 2000. In such a situation, "Kommersant-Daily" commented on 21 October, the IMF will use Russia's lack of budget as a pretext for refusing to disburse further loan installments. JAC PUTIN IN NORTHERN CHECHNYA. Prime Minister Vladimir Putin chaired a cabinet session in Mozdok on 20 October to discuss normalizing conditions in the three raions in northern Chechnya that are under federal control, ITAR-TASS reported. He then traveled with Nikolai Koshman, Moscow's designated representative in Chechnya, to the Chechen village of Znamenskoe, where he met with village elders. Putin pledged Russian help in providing electricity and gas supplies to the region and in providing accommodation for fugitives who wish to return to Chechnya. Putin also met with Russian air force pilots who are participating in the ongoing bombing raids on Chechnya and praised their "professionalism" according to Interfax. Also on 20 October, convalescing Russian President Boris Yeltsin summoned senior officials including Defense Minister Igor Sergeev, and Interior Minister Vladimir Rushailo to his dacha to discuss the situation in Chechnya. No details of those talks were made public. LF FEDERAL TROOPS ADVANCE ON GROZNY... Russian forces have crossed the Terek River and advanced to within 12-14 kilometers of Grozny, ITAR-TASS reported on 21 October quoting sources in Koshman's entourage. The previous day, the Russian artillery bombardment of the western village of Bamut and the towns of Tolstoi-Yurt and Pervomaiskoe, north of Grozny, continued. LF ...WHILE CHECHENS BRACE FOR ALL-OUT ASSAULT. In an interview printed in "Kommersant" on 20 October, Chechen army commander Isa Munaev predicted that Russian forces will launch an all- out assault on Grozny before the end of October. He said Russia's tactics currently differ from those adopted in early 1995, but he added that the Chechen forces are now better prepared to repel an attack on the city. However, "Nezavisimaya gazeta" on 21 October said that the Chechen resistance effort is more spontaneous than coordinated, adding that field commander Khattab is engaged in the defense not of Grozny but of regions of central and eastern Chechnya. Colonel General Valerii Manilov, who is first deputy chief of staff of the Russian armed forces, told journalists in Moscow on 20 October that "Grozny, as well as other places, will be cleared of terrorists and the terrorists themselves destroyed," Reuters reported. But Manilov said this would be accomplished without "a standard frontal attack." LF RUSSIA'S MONEY-LAUNDERING BILL CALLED ARBITRARY WEAPON... "Kommersant-Daily" reported on 20 October that under draft money-laundering legislation, Russian commercial banks will be required to pass information to several law enforcement agencies, including local police precincts, about any Russian citizen who opens a bank account containing at least $7,000. The newspaper suggests that existing authorities will therefore be given a powerful instrument of influence against anyone they oppose. It also predicts that the banking information will likely be leaked to "criminal structures." "Kommersant-Daily" is controlled by media magnate Boris Berezovskii, who has himself been accused of money laundering. However, the newspaper made a similar argument against the first version of the bill proposed by Communist Party faction member Viktor Ilyukhin, before Berezovskii assumed control of the daily. JAC ...AND UNLIKELY TO PASS BEFORE YEAR'S END. Duma Deputy Viktor Pokhmelkin told RFE/RL's Moscow bureau that at present, crime-fighting legislation in Russia is perceived "not as protection but as a stick that can be used arbitrarily by the state or by competitors." He added that there is little chance that a law on money-laundering will be passed before the State Duma elections in December. According to Pokhmelkin, one existing law encourages companies to report any suspicious dealings, and some companies use the law to denounce their competitors. During her visit to Moscow, U.S. Attorney General Janet Reno praised the Russian government's intention to introduce money-laundering legislation. And Deputy Secretary of State Strobe Talbott said the U.S.'s failure to back more vigorously bills in the Duma that would have fought money-laundering was a mistake (see "RFE/RL Newsline," 20 October 1999). JAC ARMS CONTROL TALKS RESUME IN MOSCOW... U.S. Undersecretary of State for arms control and international security affairs John Holum and Russian Deputy Foreign Minister Grigorii Berdennikov began in Moscow on 21 October the next round of talks on disarmament, which are expected to cover START-3 as well as U.S. and Russian stances on possible changes to the 1972 Anti-Ballistic Missile Treaty. Holum and Berdennikov last met in Washington in August, but those discussions reportedly yielded no results. The current round of talks is scheduled to conclude on 22 October. JC ...AS MOSCOW STRESSES THERE CAN BE NO 'COMPROMISE' OVER ABM. Addressing journalists in Moscow on 20 October, First Deputy Chief of the Russian General Staff Colonel General Manilov said that Russia considers attempts to destroy the "existing system of arms treaties and agreements as a threat and [as] destabilizing regional and global situation." He added that there can be "no compromise" on the 1972 ABM Treaty. Foreign Ministry spokesman Vladimir Rakhmanin, meanwhile, confirmed on 20 October that the U.S. has recently "put forward a number of proposals" on promoting cooperation in the sphere of ABM defense (see "RFE/RL Newsline," 18 October 1999), but he noted that those proposals are "confidential." At the same time, Rakhmanin underlined that Moscow is not negotiating any amendments to the ABM treaty. JC MANILOV SAYS NATO-RUSSIA RELATIONS REQUIRE 'FUNDAMENTALLY NEW BASIS.' At his 20 October press conference in Moscow, Manilov commented that the potential for developing NATO-Russia relations is "fairly big," Interfax reported. Those relations have been frozen since the NATO bombing campaign against Yugoslavia earlier this year. "A revival of relations with NATO is possible only on a fundamentally new basis," Manilov argued, remarking that the Atlantic alliance has "discarded" the NATO-Russia Founding Act. JC DUMA APPROVES PRODUCTION-SHARING PROJECTS. Deputies on 20 October approved in its third reading a bill that includes the Priobskoe oil field in western Siberia and a field in the Far North on a list of projects eligible for production- sharing agreements terms, Interfax reported. The first project will be developed with the participation of Yukos, the latter with LUKoil and Conoco. The previous day, the Duma approved in its first reading a bill that would permit the development of the Vankorskoe gas and oil field in Krasnoyarsk Krai on a production-sharing basis, according to ITAR-TASS. The agency quoted Natural Resources Minister Boris Yatskevich as saying that the field can be developed only with foreign investment. Deputy Fuel and Energy Minister Valerii Garipov announced earlier in the month that the government will ease the quota on the number of oil projects that are permitted to operate under production-sharing agreements. JAC RUSSIA TO EXPERIENCE GRAIN, MEAT SHORTFALL. The U.S. Department of Agriculture is predicting that Russia will face a shortfall of grain totaling 7.5-9.5 million tons in 2000, Interfax reported on 20 October. The department also concluded that there will be a meat shortfall, noting that meat supply of 3.8 million tons of domestic production combined with 1.45 million tons of imported meat will be insufficient to meet the country's meat demand of 5.5 million tons. According to the agency, the department's experts believe that in order for Russia to maintain its already low protein-consumption level of 1989-99, it will have to supplement its meat supplies or the population will experience a further decline in protein consumption. JAC UNEMPLOYMENT HOLDS STEADY. The number of unemployed reached 12.4 percent of the workforce or 9.12 million at the end of September, an increase of 6.2 percent compared with the end of September last year, according to the Russian Statistics Agency on 20 October. However, according to ITAR-TASS, that figure did not increase significantly from the previous month, and Interfax reported that it represents a fall from the level recorded at the beginning of the year, when the number of unemployed totaled 9.73 million. Labor Minister Sergei Kalashnikov said on 20 October that 29 percent of Russia's population are living below the minimum subsistence level. He also noted that the government has accumulated a backlog of unpaid child benefits, ITAR-TASS reported. JAC VOLSKII PREDICTS COMMUNIST SUPPORT FOR PRIMAKOV. In an interview with "Segodnya" on 20 October, Arkadii Volskii, the head of the Union of Industrialists and Entrepreneurs, said that he believes that the Communist Party (KPRF) will support Fatherland-All Russia (OVR) alliance head Yevgenii Primakov during the second round of presidential elections if current KPRF head Gennadii Zyuganov is forced out of the race. Volskii, who is a candidate on the OVR party list, added that it also possible that Zyuganov will not be allowed to run for president even in the first round since he failed to win the last presidential election. Instead, Volksii suggests the KPRF might nominate Primakov. When asked whether former Prime Minister Primakov will seek the presidency, Volskii responded that "Do you remember how he objected to his appointment as prime minister? Lots of people visited him and persuaded him. And he agreed." JAC GORBACHEV FORMS NEW PARTY. Former Soviet leader Mikhail Gorbachev has announced he will head a new united Social Democratic Party, Russian Public Television reported on 20 October. The network reported that the party is being formed too late to participate in the 19 December State Duma elections but may be able to nominate a candidate for presidential elections. The new party will hold a founding congress in February. JAC GOVERNMENT TO SPEND $12.5 MILLION ON CHRISTIANITY'S ANNIVERSARY. Andrei Loginov, head of the domestic policy department of the presidential administration, announced on 20 October that the Russian government will allocate 324 million rubles ($12.5 million) to celebrate the start of the third millennium and the 2000th anniversary of Christianity, Interfax reported. Loginov also revealed that the state has allocated 18 million rubles for an encyclopedia on peoples of the Orthodox faith. On 13 October, Security Council Deputy Secretary Vladislav Sherstyuk had told reporters that Russia will switch some crucial processes over to manual control during the transition to the year 2000 owing to a shortage of financing, AP and Interfax reported. JAC TRANSCAUCASUS AND CENTRAL ASIA U.S. DIPLOMAT ADVOCATES ARMENIAN-TURKISH RAPPROCHEMENT. Meeting in Yerevan on 20 October with Armenian Prime Minister Vazgen Sargsian, U.S. Assistant Secretary of State Steven Sestanovich proposed that Turkey and Armenia open "information centers" in each other's capitals as a first step toward establishing diplomatic relations, RFE/RL's Yerevan bureau reported on 20 October, quoting an Armenian government spokesman. Sestanovich said such a step would contribute toward a rapprochement between the two countries, which Washington considers essential for stability in the South Caucasus. He added that Ankara has responded positively to the proposal. Sestanovich also praised the recent talks between Armenian President Robert Kocharian, which whom he also met on 20 October, and Azerbaijan's President Heidar Aliev. Sestanovich said those talks "create a basis for agreement that can then be taken further by the [OSCE Minsk Group] mediators." LF ARMENIAN FOREIGN MINISTER SAYS AZERBAIJAN OBSTRUCTING TRANSPORT COOPERATION. In an interview with Armenian State Television on 19 October, Vartan Oskanian said Azerbaijan has rejected a proposal by the EU that rail communications be resumed between Armenia and Azerbaijan, RFE/RL's Armenian Service reported. He said that Armenia has offered to create a 3-5 kilometer security zone along the railway, which runs through Azerbaijani territory occupied by Armenian forces, but that Azerbaijan has rejected that proposal, insisting on the complete withdrawal of the Armenian troops from those districts. Oskanian added that the EU and the U.S. are unhappy with Azerbaijan's position. The EU-sponsored TRACECA transport program envisages the restoration of transport links between the South Caucasus states. LF ARMENIA, IRAQ TO EXPAND ECONOMIC COPERATION. Senior Armenian Foreign Ministry official David Hovhanisian told journalists in Baghdad on 20 October that Armenia will soon open an office in that city to promote economic and trade cooperation, Xinhua reported. Hovhanisian said Armenia is interested in industrial and trade cooperation with Iraq within the framework of the UN oil-for-food program. Armenia and Iraq have not yet established formal diplomatic relations. LF AZERBAIJANI OPPOSITION PLANS RESISTANCE TO KARABAKH SETTLEMENT. A 20 October session of the Democratic Congress, which unites a dozen leading Azerbaijani opposition parties, agreed to create a working group to revive the National Resistance Movement, Turan reported (see "RFE/RL Caucasus Report," Vol. 2, No. 42, 21 October 1999). The movement was created in 1994 to oppose a disadvantageous peace settlement in Karabakh. On 16 October, former President and Azerbaijan Popular Front Chairman Abulfaz Elchibey condemned U.S. Secretary of State Madeleine Albright's letter to President Aliev urging him to agree to concessions in order to resolve the Karabakh conflict as "the most insulting document in the history of world diplomacy," according to Turan LF U.S. SUPPORTS GEORGIAN CALLS FOR RUSSIAN TROOP WITHDRAWAL. Visiting Tbilisi on 19-20 October, U.S. Assistant Secretary of State Sestanovich held talks with Minister of State Vazha Lortkipanidze, parliamentary speaker Zurab Zhvania, and President Eduard Shevardnadze on the Russian military presence in Georgia and the North Caucasus, Caucasus Press reported. Sestanovich told journalists on 20 October that the U.S. shares Georgia's belief that Russian forces should be withdrawn from Georgia. During his visit, an agreement was signed under which the U.S. will provide Georgia with military uniforms and other supplies worth $1.8 million, AP reported. LF KAZAKHSTAN'S PREMIER GIVES POSITIVE ASSESSSMENT OF PARLIAMENTARY POLL... Qasymzhomart Toqaev told U.S. Ambassador Richard Jones on 20 October that both he and President Nursultan Nazarbaev believe that the 10 October elections to the lower chamber of parliament marked a new stage in the evolution of democratic processes in Kazakhstan, Interfax reported. He added that the poll "largely met" the standards set by the OSCE and other international bodies. An RFE/RL correspondent reported earlier this week that the OSCE plans to issue a report on the first round of the poll criticizing instances of falsification of the results (see "RFE/RL Newsline," 20 October 1999). LF ...AS OPPOSITION CANDIDATE PREDICTS FURTHER VIOLATIONS. Lira Bayseitova, who heads the Respublika-200 political group, told journalists in Almaty on 20 October that she has information that the local authorities in Atyrau Oblast have printed 15,000 additional ballot forms to ensure that their preferred candidate secures victory in the 24 October runoff over Ghaziz Aldamzharov, a leading member of former Prime Minister Akezhan Kazhegeldoin's Republican People's Party of Kazakhstan, RFE/RL's bureau in the former capital reported. On 19 October, a district court in Almaty rejected a case brought by defeated parliamentary candidate Gennadii Belyakov, who accused the district electoral commission of falsifying the outcome of the vote in the district in which he ran. LF NEW POLITICAL PARTY REGISTERED IN KYRGYZSTAN. Republican Party Deputy Chairman Narkas Mulladjanov told RFE/RL's Bishkek bureau on 19 October that the Ministry of Justice formally registered the party last week. The Republican Party was founded last month and is headed by Zamira Sydykova, chief editor of the opposition weekly newspaper "Res Publika" (see "RFE/RL Newsline," 20 September 1999). LF KYRGYZSTAN BEGINS WITHDRAWING TROOPS FROM SOUTH. A Defense Ministry spokesman said in Bishkek on 20 October that the first detachments of army troops sent to Osh Oblast in August following the hostage taking there by Uzbek guerrillas will return to Bishkek later that day, RFE/RL's bureau in the capital reported. He added that reservists called up in August are being demobilized. Also on 20 October, an unidentified source in the National Security Ministry said Deputy Minister Valerii Verchagin traveled to Dushanbe that day for talks aimed at securing the release of four Japanese geologists still held by the guerrillas. Tajik Minister for Emergency Situations Mirzo Zieev and other members of the United Tajik Opposition helped mediate the release of several Kyrgyz hostages (see "RFE/RL Newsline," 20 October 1999). LF IRANIAN FOREIGN MINISTER VISITS TURKMENISTAN. Kamal Kharrazi headed a delegation from the Oil, Energy, and Transport Ministries that traveled to Ashgabat on 20 October, Reuters and Interfax reported. Kharrazi and President Saparmurat Niyazov discussed plans for cooperation in road building and the extraction of Caspian gas and for the export of electricity from Turkmenistan to Turkey via Iran. It is unclear whether they also discussed exports of Turkmen gas via Iran. Niyazov had told visiting Turkish Energy Minister Cumhur Ersumer two weeks ago that the topic would be on the agenda of their talks (see "RFE/RL Newsline," 7 October 1999). An agreement was signed on the construction of a $167 million dam and reservoir for irrigation purposes on the Tedzhen River, which forms the border between the two countries, Reuters reported (see "RFE/RL Newsline," 6 September 1999). LF END NOTE MUCH ADO ABOUT UNITY by Julie A. Corwin If Prime Minister Vladimir Putin is Russian President Boris Yeltsin's anointed successor, then the newly registered interregional group Unity represents his bloc of choice for December's State Duma elections. Putin himself attended Unity's founding congress on 3 October as a guest, while First Deputy Chief of Presidential Staff Igor Shabdurasulov said that the bloc has "unequivocal support" from Yeltsin's staff. And one of the most popular and longest-lasting member of Putin's government, Emergencies Minister Sergei Shoigu, has been tapped as its head. Although predictions of the bloc's success in upcoming State Duma elections vary widely, the bloc may have already achieved what most analysts believe to be its raison d'etre: chipping away support for the popular Fatherland-All Russia (OVR) alliance. In a recent interview with "Segodnya," Andrei Fedorov of the Council for Foreign and Defense Policies explained that Unity's "first task is to put Fatherland-All Russia out of action and if possible, take 10 percent of the vote from them, thus pushing them into third place in the parliament, and after that it is supposed to try to become a springboard for the Kremlin's candidate for president." If reports of its membership can be trusted, Unity has already struck at core OVR interests by luring away four of its members, including Primorskii Krai Governor Yevgenii Nazdratenko. In fact, more than half of the governors who have reportedly joined Unity were already aligned with other political parties or movements: besides the four former OVR members, the group includes six former members of Voice of Russia, which is headed by Samara Governor Konstantin Titov. In addition, five governors out of the seven enrolled in former Prime Minister Viktor Chernomyrdin's Our Home Is Russia (NDR) have expressed their wish for membership in both groups, while a sixth, Saratov Governor Dmitrii Ayatskov, has expressed his willingness to support Unity and has actively sought a merger of the NDR with Unity. Also, Unity already appears to be acting as a bloc within the Federation Council and can therefore counter any OVR-backed efforts there. Consider the recent Kremlin- initiated vote in the upper legislative chamber to oust suspended Prosecutor-General Yurii Skuratov. The voting was kept secret, but in interviews with senators that "Kommersant-Daily," Russian Public Television, and NTV conducted after balloting, all of the regional leaders expressing support for Skuratov's dismissal, except one, were members of Unity. Meanwhile, some of the most vocal supporters for retaining Skuratov were OVR members, such as Chuvash President Nikolai Fedorov. However, Unity's failure to align with the NDR has prompted some analysts to conclude that the bloc will not capture enough votes in the Duma election to enter the lower legislative chamber. Unity officials claimed that NDR imposed too many preconditions, while NDR faction leader Vladimir Ryzhkov argued that NDR members resisted the union, despite Kremlin pressure, because Unity lacks a coherent political philosophy. NDR head Viktor Chernomyrdin put it this way: Unity "has no ideology," it has only business magnate Boris Berezovskii. While Berezovskii has denied that he was behind Unity's creation, as has Unity head Shoigu, Unity member and Governor of Kursk Aleksandr Rutskoi has acknowledged Berezovskii's involvement. Also, coverage of the movement in his media holdings suggests that Berezovskii has at least a mild interest in the bloc's good fortunes. In its reporting on Unity, "Nezavisimaya gazeta" has stressed the movement's successful recruitment efforts and alignments with smaller political parties and organizations following the failure of efforts to merge with the NDR. Such coverage contrasts sharply with the picture depicted in media owned by rival oligarch Vladimir Gusinskii's Media Most group or in newspapers close to Moscow Mayor Yurii Luzhkov, the head of Fatherland. "Segodnya" and "Moskovskii komsomolets" have reported Kremlin pressure on governors to join Unity, while "Obshchaya gazeta" claimed in its most recent issue that according to its sources, which it did not identify, only six or seven governors have actually joined Unity. EWI's "Russian Regional Report" puts the tally of governors affiliated with Unity at 28, including the five members of the NDR who will maintain dual allegiance. Some skepticism about Unity's membership list is perhaps natural, since little seems to unite its diverse members. Even the top three names on that list present an odd assortment of philosophies and professions: Emergencies Minister Shoigu, former NDR member and Olympic wrestler Aleksandr Karelin, and former top cop Aleksandr Gurov. Gurov, the current head of the security department of Tepkobank, is the former head of the Department Combating Organized Crime at the Interior Ministry and has expressed his support for General Aleksandr Lebed many times. Even more striking for a Kremlin-backed bloc are the names of Rutskoi and Nazdratenko. Unity's congress occurred on the sixth anniversary of the day Rutskoi, at the time Yeltsin's vice president, called on Russian troopers to storm Ostankino, while President Yeltsin has tried to remove Nazdratenko and only this year recalled his envoy from Primorskii Krai, whose main task was to rein in the governor. It is possible that these Yeltsin's foes have been drawn to a Kremlin-backed grouping for the same reason that one Chukotka official claims his governor has signed on: additional financial aid from the center. OVR members, on the hand, will presumably have to wait until after the election. xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx Copyright (c) 1999 RFE/RL, Inc. All rights reserved. xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx HOW TO SUBSCRIBE Send an email to email@example.com with the word subscribe as the subject of the message. 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