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Newsline - March 28, 1995

President Yeltsin began his two-week journey by taking a train to the central Russian city of Ryazan, but then unexpectedly changed his plans and flew to the town of Mineralnye Vody in the North Caucasus and traveled on to Kislovodsk by car, ITAR-TASS and Reuters reported. The agencies said that he will stay in Kislovodsk for "a short rest." Yeltsin had intended to travel by train to Southern Russia and there was no immediate explanation why he scuttled his earlier plans. Ryazan is only 110 miles from Moscow. On 28 March, Nezavisimaya gazeta reported that he wanted to travel by train to see how well Russia's railroads were functioning and because "for the last twenty years I have not traveled by train." Reporters accompanying the president said he looked tired but fit. The president also plans to visit the republic of Kabardino-Balkaria and Sochi. * Robert Orttung

President Yeltsin has not decided whether to run for re-election, according to an announcement he made at a locomotive depot in Ryazan on 27 March, Interfax reported. He said his trip through the country cannot be regarded as part of an election campaign. Naina Yeltsin, Russia's first lady, told railway workers that she opposed a re-election bid for family reasons. "I want him to be free of all that in 1996, but my heart tightens when I think about who could replace him," AFP reported her as saying. Yeltsin's popularity rating has dropped into the single digits since the Chechen war and he has struggled since then to regain his lost stature among the Russian people. * Robert Orttung

Federation Council Deputy Chairman Valerian Viktorov said that support might grow among Russia's regions for postponing parliamentary elections scheduled for December 1995, Interfax reported. Viktorov said putting off elections would prevent the parliament from rushing to adopt a new electoral law, and also would provide the "political stability" needed to implement the government's program. He said the elections could only be postponed if two-thirds of Russia's 89 regions supported such a proposal. However, Viktorov dismissed the idea of delaying presidential elections scheduled for June 1996. He said President Boris Yeltsin had been elected in June 1991 "for a perfectly definite term." * Laura Belin

Yabloko member Igor Yakovenko, the head of the State Duma commission investigating the transformation of state-run Ostankino Channel One, said deputies would challenge the legitimacy of the restructuring plan in the Constitutional Court and the Court of Arbitration, Interfax reported. In November 1994, Yeltsin ordered the reorganization of Ostankino. The first step of the plan was the creation of the partly-private Russian Public Television Company. Under the restructuring decrees, Ostankino was to become a production company, and Russian Public Television would assume control over programming and broadcasting on Channel One. Yakovenko charged that the creation of Russian Public Television had unlawfully appropriated state property and forced Ostankino out of Channel One. * Laura Belin

The Federal Commission for Securities and the Bond Market has granted a profit tax exemption on bonds and securities issued by Russian regions, the Financial Information Agency reported on 27 March. Under a 23 March commission resolution, regional bonds are to be exempt from profit tax and treated on par with government securities. Earlier, a 15% profit tax was levied on all securities, except government bonds. Government experts said that caused regional capital flight. * Thomas Sigel

Russian fuel prices increased in mid-March according to the government's Center for Economic Studies, the Petroleum Information Agency reported on 27 March. Petrol product prices soared 17.9%. Meanwhile, experts point to a slower rise in electricity rates, which rose by 3.2%. Coal prices rose 3.5% with coking coal prices at 87,000 rubles (4,800 rubles to $1) per ton and energy coal at 47,000 rubles per ton. Oil prices increased by 13.7% over February with the average price at 181,000 rubles per ton. The price of natural gas increased by only 1.1%, due to unchanged costs in West Siberia, Russia's main gas supplier. Since the beginning of the year, shipping tariffs have jumped 80%, while consumer prices are up 60%. Retail gasoline prices average 922 rubles per liter. * Thomas Sigel

Inflation expectations in industry continued to decline in March, according to a poll of Russian manufacturing managers conducted by the Institute for Economic Problems, Interfax reported on 27 March. Eighty-one percent of the managers predict rises in the prices of their output, compared to 87% in January and 85% in February. Minimal inflation expectations have been registered in the wood-working sector and maximum inflation is predicted in the engineering sector. Almost half of the managers polled expect production to remain stable during the next few months and 18% hope for an increase. After two months of dropping demand, there has been a slight rise in production, especially in engineering and construction. According to official forecasts, March inflation will be at 9%, compared to almost 18% in January. * Thomas Sigel

Mining union activists in Vorkuta ended their 10-day hunger strike on 25 March following the visit of an interdepartmental commission to the area, Ekho Moskvy reported. According to Alexander Marmalyukov, chairman of the Independent Miners' Union, a compromise was reached on the question of the payment of back wages and the future of coal mines in the region. However, a number of fundamental problems remain, in particular the lack of a state program for the restructuring of the industry. Meanwhile, miners in Primorsky Krai have vowed to go on strike if they do not receive wage arrears by 5 April, Russian TV reported on 27 March. They have stopped making coal deliveries to customers who have not paid their bills. In a 23 March interview with Pravda, Rosugol president Yury Malyshev said consumers owe the coal mining industry about 2 trillion rubles. * Penny Morvant

Before departing on his vacation, President Yeltsin stressed that Russian nuclear aid to Iran will be the most complex item on the agenda of his May summit with U.S. President Bill Clinton, Interfax reported on 27 March. Yeltsin dismissed press accounts that little progress had been made at meetings between Russian Foreign Minister Andrei Kozyrev and U.S. Secretary of State Warren Christopher on 23-24 March. He said Kozyrev had been instructed to engage in preliminary discussions on outstanding issues--not to resolve them. Yeltsin's comments give further credence to report in the 18 March issue of Moskovskiye novosti that Kozyrev was reprimanded for exceeding his brief in suggesting a possible middle ground in Russia's debate over eastward expansion with NATO. * Michael Mihalka

The head of the latest OSCE delegation to visit Chechnya, Istvan Gyarmati, said little or no progress had been made toward a political settlement in Chechnya, Interfax reported on 27 March. He said, "We got the impression that the popular government in Chechnya has not formed its local bodies and is only helping federal troops, though things should be the other way round." He added that he saw no prospects for a military solution to the conflict. Gyarmati also announced that a six-member OSCE mission will be set up in Grozny by mid-April. The mission is intended to promote a political settlement, develop a constitution, assist in holding democratic elections, and, if necessary, help mediate an agreement between Chechnya and the Russian Federation. The European Union set the establishment of such a mission as a pre-condition to signing an interim trade accord with Russia. * Michael Mihalka

Kazakh President Nursultan Nazarbaev has called for a nationwide referendum to be held on 29 April to decide whether his term in office, which ends in 1996, should be extended to the year 2000, Russian TV reported. On 24 March, the Assembly of the People's of Kazakhstan advised Nazarbaev to hold the referendum but the Kazakh president said he needed to review the legality of such a move. The assembly was formed days before a ruling by the Kazakh Constitutional Court to disband parliament was upheld. Nazarbaev is quoted by Reuters as saying, "We hear cries that there will be dictatorship, Yes, dictatorship will come but a dictatorship of the constitution and of the law." He added, "There will be a real dictatorship if, under democratic slogans, chaos and anarchy will be created. Then the people will call for a firm hand." Meanwhile, Caravan, a Kazakh newspaper critical of Nazarbaev, will not be printing this story for two weeks. A fire broke out in the paper's warehouse on the night of 23 March, causing it to lose 1,000 tons of newsprint. Although the blaze was attributed to a spark from welding equipment, Caravan employee Vera Avalyani said workers saw the fire start in four places simultaneously, according to Reuters. * Bruce Pannier

Tajik Prime Minister Djamshed Karimov said his country is interested in buying oil from Iran, the official Iranian news agency IRNA reported. In a meeting with the Iranian ambassador to Tajikistan, Ashraf Shabesteri, Karimov also mentioned Tajikistan's interest in opening a direct air link between Dushanbe and Tehran. Tajikistan, along with other Central Asian countries, is attempting to reduce its economic dependence on Russia by establishing new trading partners and obtaining access to Iranian sea ports, according to NCA/Reuters. The Iranian ambassador said Tehran would be willing to help in the exploration of mines, complete the construction of factories, and transport goods for export to the Persian Gulf. Iran will send an industrial delegation along with representatives of Iran's chamber of commerce to Tajikistan to discuss trade relations sometime in the near future, Reuters reported. Iran has been trying to establish closer ties to the Central Asian republics since the fall of the Soviet Union. * Bruce Pannier

A Russian delegation from the Duma commission on the Black Sea Fleet, accompanied by the head of the Duma Committee on CIS Affairs, Konstantin Zatulin, arrived in Crimea on 26 March, Ukrainian radio reported the following day. The delegation was met at the airport by the Crimean Procurator, Valentyn Kuptsov, who officially notified Zatulin and the Duma commission that they should not make any disparaging statements against Kiev and should not take part in any activities aimed at worsening confusion over the Crimean situation. Zatulin has distinguished himself in the Duma as being the leading critic of Ukraine's 17 March decrees abolishing the Crimean constitution and presidency. During his visit, Zatulin has been meeting with pro-Russian officials. On the first day, he met with Crimean President Yuri Meshkov and Crimean parliament speaker Serhii Tsekov. On 27 March, Zatulin met with the commander of the Black Sea Fleet, Admiral Eduard Baltin. * Ustina Markus

The Ukrainian and Russian defense departments have agreed that Ukraine's $192.6 million debt to Russia for natural gas could be written off in return for 44 ex-Soviet strategic bombers, Interfax reported on 27 March. "An informed source" told the agency that Ukraine had originally demanded $800 million for the 19 Tu-160 "Blackjack" supersonic jets and the 25 Tu-95MS "Bear" turboprop missile-car-
rying aircraft left on its territory after the collapse of the Soviet Union. However, several weeks ago, a Russian newspaper reported Ukraine had agreed to sell the planes for $75 million. The source said the aircraft would be transferred to Russia once the agreement was signed, adding that it would not be tied to an agreement on the division of the Black Sea Fleet. * Doug Clarke

Chairman of the Coalition Party and Rural Union alliance (KMU) Tiit Vahi on 27 March said the KMU board approved the cooperation principles on forming a government coalition with the Center Party, BNS reported. The principles had been agreed on the previous day by representatives of the two parties. Vahi, President Lennart Meri's nominee for prime minister, said he had ended coalition talks with the Reform Party on learning that it had joined the so-called alternative coalition to elect the parliament chairman. Karin Jaani, head of the Rightists, who had formed a coalition with the KMU, said her party was going into opposition since it had clearly stated that it would not join any alliance that included the Center Party. * Saulius Girnius

At the Democratic Party's fifth congress on 25 March, 143 of the 165 delegates voted in favor of merging with the "Master" party to form the Democratic Party Master, BNS reported. The DPM merger congress is scheduled for 29 April. Democratic Party Chairman Maris Pukis said the merger of the two centrist parties was a necessary step before the elections to the sixth Saeima. The Political Union of Economists and the Republican Party are also reported to want to form a pre-election coalition with the DPM. * Saulius Girnius

Residents of the Kaisiadorys district on 25 March voted to fill the parliament seat that President Algirdas Brazauskas won in October 1992 but vacated on becoming president in February 1993, BNS reported on 27 March. The vote took place on the same day as local council elections. Four previous runoffs were annulled owing to insufficient voter turnout. None of the five candidates in the 25 March contest received a majority of the votes, forcing a runoff election between former Supreme Council Secretary Liudvikas Sabutis, nominated by the Homeland Union, and Minister of Agriculture Vytautas Einoris of the Democratic Labor Party. Sabutis received 38.4% of the votes, Einoris 28%. * Saulius Girnius

Lithuanian and Moldovan Presidents Algirdas Brazauskas and Mircea Snegur on 27 March signed a treaty of friendship and cooperation in Chisinau, Interfax reported. Snegur, noting that the volume of trade between the two countries has declined by two-thirds, urged the restoration of former trade links. He expressed satisfaction that Lithuania was supporting his country's efforts to join the Council of Europe. Brazauskas travels to Kiev on 28 March for meetings with Ukrainian President Leonid Kuchma and other officials. * Saulius Girnius

Serhii Parashin, general director of the Chornobyl nuclear power plant, says safety measures taken at the station and an additional $300 million invested by the Ukrainian government for new safety systems make another nuclear explosion such as the one in April 1986 "impossible," Interfax-Ukraine reported on 27 March. Parashin said recent accusations by the British newspaper The Observer that a lack of safety precautions could lead to a second accident of the same proportions as nine years ago were "groundless." He accused Western countries of unfairly putting pressure on Ukraine to close the plant, which provides 7% of the country's energy. The G-7 countries last summer announced that the closure of Chornobyl was a major condition for a $4 billion aid package to Ukraine. Ukrainian leaders have asserted that closing the plant would cost several billion dollars, while the EU has allocated only $200 million for that purpose. * Chrystyna Lapychak

Ukrainian Defense Minister Valerii Shmarov told a Kiev press conference on 27 March that the proposed 1995 budget for the Ukrainian military would cover only 30% of its needs. He added that the armed forces have been under-funded during the past three years and warned that if the budget is further reduced, the armed forces will lose their capacity to fight. According to Interfax, Shmarov also said that Ukraine will be seeking to strengthen its traditional cooperation with Russia in the manufacture of arms. He noted that Ukraine will also seek ties with countries that were not part of the former Soviet Union. * Doug Clarke

Ukrainian Defense Minister Valerii Shmarov said on 27 March that Ukraine most probably will not complete the aircraft carrier Varyag because it cannot, and Russia will not, pay the $300 million needed to finish the vessel, Interfax reported. A sister ship to the Russian Navy's Admiral Kuznetsov, the Varyag was launched in November 1988 and has been idle alongside the pier in Mykolaiv since 1991. It has been rumored in recent years that China is interested in buying the ship. Shmarov said Ukraine will look into ways of "customizing" the vessel for other uses, since it will bring in only about $5 million if sold as scrap metal. * Doug Clarke

Ural Latupau, Belarusian presidential aide for foreign policy matters, told Interfax on 27 March that Belarus will not resume the weapons' destruction mandated by the Conventional Forces in Europe treaty until it can finance the process. He said there were two ways to obtain the necessary money: from the industrialized Western countries or to wait until Belarus pulls out of its current economic crisis and can fund the destruction from internal resources. President Alyaksandr Lukashenka announced on 17 February that he was halting the weapons destruction. First Deputy Foreign Minister Valerii Tsyapkala said he believed that the "supreme interests" clause in the CFE treaty justifies Belarus's action. That clause allows a country to withdraw from the treaty "if it decides that extraordinary events related to...this Treaty have jeopardized its supreme interests." Other signatories are unlikely to agree that economic difficulties are sufficient cause. * Doug Clarke

The Belarusian Television program "Prospekt" on 26 March broadcast the results of an opinion poll taken by the Andrei Vardomatskou sociological center at the beginning of March on the proposed referendum on, among other things, the status of the Russian language in the republic, changing the country's national symbols, and extending the president's powers. According to the poll, 54% of the respondents were in favor of giving the Russian language official status; 30% were opposed; and 17% gave no answer. On the issue of political union with Russia, 59% were in favor; 23% were opposed; and 18% did not reply. The response to posing the question of state symbols was surprising: 35% upheld including such a question in the referendum; 46% were against; and 20% percent were unable to say. * Ustina Markus

Prime Minister Jozef Oleksy met with Cardinal Jozef Glemp on 26 March, Rzecz-pospolita reported. After their meeting, both leaders made cordial but vague remarks about the substance of their discussions. The conciliatory stance taken by Democratic Left Alliance (SLD) leaders on Church-state issues is prompting angry protests by the party's rank-and-file and appears to be undermining the position of moderates, headed by SLD floor leader Aleksander Kwasniewski. At a meeting on 27 March of the main council of the Social Democracy of the Polish Republic (SdRP)--the successor to the communist party and the leading force within the SLD--Kwasniewski faced harsh criticism for "servility" toward the Catholic hierarchy. He argued that "compromise with the Church is proof of wisdom and strength, not weakness." But most activists argued for a hard line on Church issues, and objected to Church demands that the party atone for communism. Kwasniewski reaffirmed the party's line that the concordat must be renegotiated and the new constitution must enshrine the "worldview neutrality" of the state. The SdRP adopted a resolution stating that the party refuses to accept the creation of a "confessional state." * Louisa Vinton

Polish Supreme Court chairman Adam Strzembosz announced his candidacy for president on 27 March, Radio Warsaw reported. Strzembosz said he is allied with no political party but that the "center-right" option is closest to his heart. He said that decom-munization became impossible after the 1993 elections, but lustration was still necessary. Strzembosz plans to take unpaid leave during the campaign rather than resign, Rzecz-pospolita reported. Several of Poland's right-wing parties have already endorsed his candidacy; but the largest, the Christian National Union, remains undecided. Lingering support for President Lech Walesa and chronic discord are likely again to fragment the right-wing vote in this year's presidential elections. Janusz Korwin-Mikke, chairman of the fringe libertarian Real Politics Union, announced his candidacy on 23 March. * Louisa Vinton

Party of the Democratic Left Deputy Chairwoman Brigita Schmoegnerova has criticized the government's "uncontrolled" priva-tization policy, Pravda and Narodna obroda reported on 28 March. She warned that the government is returning to the privatization methods used during Prime Minister Vladimir Meciar's second term in office, thereby breaking pre-election promises. Schmoegnerova criticized the lack of transparency in privatization and the role of the National Property Fund in the process. She argued that the case of Slovakia's second-largest investment fund, PSIPS--which has been embroiled in controversy since the Finance Ministry ordered it to stop its activities on 3 March--confirms the ministry's inability to secure control over investment funds. The PDL is preparing to propose a law on privatization, Schmoegnerova noted. * Sharon Fisher

Nasa Borba on 28 March quoted a UN spokesman as saying that attacks on UN-designated "safe areas" in Bosnia-Herzegovina may be met with air strikes. He was referring to Serbian shelling of Sarajevo, Bihac, Gorazde, and Tuzla but added that the UN would not intervene if the Serbs were being fired on by government forces. State-run Borba, meanwhile, says that "the [Bosnian] Serb army is on the counteroffensive" and claims high losses among government troops. But AFP notes that the government army is newly reorganized and has several mobile units composed of men driven from their homes in "ethnic cleansing." Morale and mobility are two key advantages the government troops have over the Serbs, but the mainly Muslim forces are careful not to challenge the Serbs head-on yet in areas of Serbian vital interest, such as the Posavina land corridor. * Patrick Moore

Vjesnki on 28 March reports that Croatian Foreign Minister Mate Granic has criticized UN Secretary-General Boutros Boutros Ghali's proposal for a new international peacekeeping force in Croatia. He said the plan violates the spirit of the Copenhagen agreement between Zagreb and Washington. That accord specified that a new and smaller force would be created to monitor Croatia's external borders and that its patrolling of Croatian-Serbian front lines within the country would be secondary. Croatia also does not like the latest proposed name for the peacekeepers, namely United Nations Peace Force One, since it does not include the word "Croatia." The Serbs squashed a previous suggestion that the troops be called United Nations Forces in Croatia. According to the latest proposal, Force Two would be in Bosnia and Force Three in Macedonia. * Patrick Moore

Nasa Borba on 28 March reports that the rump Yugoslav currency, the so-called super dinar, has come under intense inflationary pressure. The super dinar was introduced by National Bank Governor Dragoslav Avramovic in January 1994 and pegged officially to the German mark at a rate of 1:1. The daily reports that dealers in Kragujevac were selling one German mark for 2.7 dinars on 27 March, while in Novi Sad the mark fetched 3.5 dinars and in Belgrade 4.7-5.0 dinars. Politika reported that Serbian Finance Minister Dusan Vlatkovic, in an apparent attempt to calm public concerns, said on Serbian Radio and Television the previous day that there was nothing to worry about. He told Serbs to "save your money, which you will need tomorrow and which [should not] be eaten up by speculators." * Stan Markotich

Riot police backed by light tanks on 27 March ended a five-day protest by inmates of Idrizovo prison, near Skopje, AFP and Reuters reported the same day. Some 120 riot police and 200 prison guards entered the prison after tanks had broken up the entrance of the main building, where most of the 400 rebellious inmates staged their protest against severe sentences and poor living conditions. Most of the protesters are serving lengthy terms for capital offenses. Authorities said that about 60 of the inmates involved in the riot were foreigners from Bulgaria, Albania, Turkey, and elsewhere. No casualties were reported, but witnesses said that some prisoners were beaten during the four-hour police action. Justice Minister Vlado Popovski told the press that the demonstrators face additional sentences of up to five years on mutiny charges and that 100 of them will be transferred to other prisons. * Stefan Krause

Opposition deputies on 27 March walked out of the Senate and the Chamber of Deputies in protest over what they see as political interference in state-run TV, Radio Bucharest reported. The politicians staged the protest after being refused permission to read out a declaration of support in favor of TV union leader Dumitru Iuga, who has been on a hunger strike for almost one month. Iuga and the opposition have accused the government of seeking to control state-run TV by appointing its own candidates to the Romanian Television Administrative Council (see OMRI Daily Digest, 24 March 1995). The deputies plan to boycott parliament sessions for one week. * Dan Ionescu

Lt. Gen. Aleksandr Lebed, commander of the 14th Russian Army, headquartered in Tiraspol, told Interfax on 27 March that the recent referendum in the breakaway Dniester Republic on whether to keep Russian troops there will have no effect on his men. More than 90% of the 400,000 or so voters who took part in the 26 March poll said they wanted the 14th army to stay in the region as a "guarantor of peace and security." Interfax quoted Lebed as saying that "a decision about whether to withdraw the army or not will be taken by the leadership of Moldova and the Russian Federation." He added that he was prepared to abide by that decision. Also on 27 March, Moldovan President Mircea Snegur reiterated that Chisinau regards the 26 March referendum and local elections in the Dniester region as illegal. * Dan Ionescu

The Bulgarian government on 27 March approved the final version of the privatization program, Bulgarian newspapers reported the following day. Kontinent and Zemya said that 20 billion leva ($300 million) in privatization revenues are expected for 1995. The government wants to privatize 600 enterprises, or 20% of all state-owned firms, by the end of 1995. Trud cited Yosif Iliev, director of the Center for Mass Privatization, as saying that every Bulgarian citizen over 18 will receive privatization vouchers worth a total of 50,000 leva ($750). The final mass privatization scheme will be approved by the end of August or the beginning of September, Trud reported. A list of enterprises to be included in the first privatization wave will be drawn up at the same time. * Stefan Krause

The Albanian Interior Ministry accused members of the former communist secret police, Sigurimi, of circulating false rumors that visas for the U.S. were available. Reuters on 27 March reported that an anonymous leaflet was distributed in Tirana, claiming that jobs were being offered in the U.S. About 1,200 young Albanians had been waiting outside the American embassy since 23 March. One 19-year-old Albanian was shot in the leg when police dispersed the group after about 200 tried to enter the embassy on 26 March. * Fabian Schmidt

Ion Iliescu began a three-day visit to Albania on 26 March, the Albanian-language service of Deutsche Welle reported the next day. He met with Albanian President Sali Berisha to discuss the two countries' integration into Europe and sign economic, cultural, and education accords. Iliescu also met with parliament speaker Pjeter Arbnori, Prime Minister Aleksander Meksi, and representatives of the ethnic Romanian community in Albania. * Fabian Schmidt

[As of 12:00 CET]
Compiled by Victor Gomez and Jan Cleave