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Newsline - July 11, 1995


OMRI DAILY DIGEST

Vol. 1, No. 133, 11 July 1995
YELTSIN HOSPITALIZED WITH HEART CONDITION.
President Boris Yeltsin was hospitalized with heart problems on 11 July, Russian and Western news agencies reported. He is undergoing tests for ischemia, a disease involving insufficient blood flow into an organ, which in the case of the heart, can lead to a heart attack. Agencies reported that he is fully conscious and doctors expect him to recover. Tests conducted in April showed that Yeltsin was suffering from high blood pressure, but that he was otherwise healthy. There has been much speculation in recent years on Yeltsin's health and drinking habits. He was hospitalized with chest pains after losing his party post in 1987. Heart trouble forced him to stop work for two days in September 1991. On 11 December 1994, the day Russian troops invaded Chechnya, he was having nose surgery. In February 1995, television reports showed aides helping Yeltsin walk upstairs at a CIS meeting in Almaty. Yeltsin had been scheduled to attend talks in Moscow today on the constitutional status of the eastern Siberian region of Buryatiya. -- Robert Orttung

IN CASE OF YELTSIN'S INCAPACITATION, CHERNOMYRDIN WOULD ASSUME PRESIDENTIAL DUTIES.
If President Yeltsin's heart problems were to render him incapable of carrying out his duties, Prime Minister Viktor Chernomyrdin would assume the post of acting president, according to Article 92 of the Russian Constitution. As acting president, Chernomyrdin could exercise all the powers of the Russian presidency except dissolving the Duma, calling referenda, and initiating the process for constitutional amendments. If Chernomyrdin were to become acting president, the constitution specifies that new presidential elections must be held within three months of the date on which Yeltsin leaves office. However, the constitution does not specify who has the authority to determine that the president is incapable of fulfilling his duties, thus paving the way for considerable political debate should Yeltsin remain in the hospital for an extended period. -- Scott Parrish

BREAKTHROUGH REPORTED IN GROZNY NEGOTIATIONS.
Russian and Chechen negotiators said on 10 July that they had reached preliminary agreement on the troublesome issue of Chechnya's constitutional status, Russian and international agencies reported. A spokesman for the OSCE, which is mediating the talks, called the agreement a "breakthrough." The agreement appeared to indicate that the Chechen side has accepted a Russian proposal to postpone a final decision on Chechnya's status until after new elections. Also on 10 July, the two delegations issued a joint statement condemning the forced expulsion of ethnic Chechens from Stavropol Krai and Rostov Oblast. More than 100 Chechen families have returned to Chechnya after being forced to leave their homes in southern Russia, according to Russian officials. -- Scott Parrish

CONSTITUTIONAL COURT HEARS OPENING ARGUMENTS IN CHECHNYA CASE.
The Constitutional Court heard opening arguments in the parliamentary challenge to secret decrees issued by the president and government in November and December 1994 concerning the military campaign in Chechnya, Russian media reported on 10 July. Former Justice Minister Yurii Kalmykov, a State Duma deputy representing the Duma in the case, said under the constitution, acts affecting the rights of citizens are only valid upon their publication in the press, Russian Public Television reported. Kalmykov noted that the secret decrees had limited ordinary citizens' freedom to travel to Chechnya. Furthermore, the parliament's legal team will argue that troops can only be deployed on the territory of the Russian Federation if a law declaring a state of emergency is published. Meanwhile, presidential aide Georgii Satarov told NTV that opposition deputies in parliament filed the appeal for political, not legal, reasons. Legal experts cited by NTV expect the case to go on for at least two weeks. -- Laura Belin

CONSTITUTIONAL COURT STRIKES DOWN REGIONAL ELECTORAL LAW.
Before opening the Chechnya case, the Constitutional Court struck down amendments to the electoral law of the Chuvash Republic as unconstitutional, Russian TV reported on 10 July. In August 1994, the Chuvash State Soviet removed the provision requiring a minimum level of voter turnout for regional elections. Under the revised law, the candidate in a regional election who wins a plurality of votes is declared the winner. Chuvash President Nikolai Fedorov appealed to the court in June on the grounds that the constitution requires at least a 25% voter turnout for any election to be valid in the Russian Federation. Since approximately one third of the Chuvash Soviet was elected in November 1994 on the basis of the amended electoral law, more legal challenges are likely to follow. -- Laura Belin

RUSSIAN MEDIA FACES FINANCIAL DIFFICULTY.
More than 85% of Russian publications are not financially independent, according to Iosif Delashinskii, head of the analysis department at the State Press Committee, Radio Rossii reported 10 July. There are now 10,500 newspapers in the country, most with a print run of less than 10,000 copies. Delashinskii said that as much as 70% of the country's printing equipment needs to be replaced. -- Robert Orttung

ISLAMIC GROUP FORMS ELECTORAL BLOC.
Islamic activists, led by Geidar Dzhemal, announced the formation of a new electoral bloc, the Islamic Committee, at a Moscow press conference on 10 July, Russian TV reported. Dzhemal stressed that Orthodoxy and Islam have much in common and can stand together against Western nihilism. Dzhemal believes that Russia must form a union with Islamic countries and that the Muslim politicians of Russia can act as intermediaries. One possibility, he suggests, is to attract capital from Islamic countries to finance Russian high-tech projects. Abdurashid Dudaev, assistant to the president of Ingushetia, said the committee supports the territorial integrity of Russia with the recognition of equal rights for Muslims. Recent months have seen the formation of other groups appealing to Muslim voters, such as the Islamic Democratic Party of Russia. -- Robert Orttung

GOVERNMENT SETS UP SOCIAL DEVELOPMENT COUNCIL.
Prime Minister Viktor Chernomyrdin has ordered the establishment of a Social Development Council under the government, Rossiiskie vesti reported on 11 July. The council will be headed by Deputy Prime Minister Yurii Yarov and its duties will include analyzing draft laws related to social policy, and elaborating measures to combat poverty, unemployment, and other social problems. Meanwhile, Ekho Moskvy reported on 10 July that President Yeltsin had issued a decree disbanding the presidential Social Policy Council and its apparatus. A spokesman said it duplicated the work of other presidential consultative services. -- Penny Morvant

ART THEFT THWARTED.
Customs officers at the Troitsk checkpoint in Chelyabinsk Oblast on the Russian-Kazakh border thwarted an attempt to smuggle a large consignment of valuable artworks out of Russia, Krasnaya zvezda reported on 11 July. The officers found 2,400 paintings, etchings, and sketches, including works by famous artists, under a pile of tires in a truck. Experts are now trying to determine which museum the artworks belong to. There have been numerous thefts from museums and cases of valuable artifacts being smuggled out of Russia since the collapse of the Soviet Union. -- Penny Morvant

SLAVE LABOR DISCOVERED IN VLADIVOSTOK.
Zhao Guobin, president of the Center for the Protection of Interests of Chinese Entrepreneurs, claims that several hundred Chinese peasants have been exploited for three years at the Hong Kong financed Pacific Development knitwear factory in Vladivostok, Segodnya reported on 8 July. The Chinese laborers' papers were taken away and they were unable to obtain money or medicines when they needed them. Citing figures released by Primorsk Krai authorities, the paper said that in the first half of this year, nearly 12,000 foreigners invited by businesses came to work in the krai. -- Penny Morvant

RUSSIAN/SOUTH KOREAN ARMS DEAL SIGNED.
Russian Deputy Prime Minister Oleg Davydov and his South Korean counterpart, Hong Jae-Hyong, signed an agreement in Seoul on 10 July whereby Russia will provide $457 million worth of arms and raw materials to South Korea, Russian and international agencies reported. The payments will be used to offset some of Russia's debt to that country. The deal includes $210.5 million in arms and military equipment. In April, the Koreans indicated that they would be getting Russian T-80U tanks, BMP-3 infantry fighting vehicles, Igla air-defense missiles, and Metis anti-tank missiles. -- Doug Clarke

JAPANESE CULT WANTED RUSSIAN SPACE BOOSTER.
The head of the Aum Shinrikyo cult's "construction ministry" had shown an interest in purchasing a Russian Proton space booster according to Japanese police, the Kyodo news agency reported on 10 July. Kiyohide Hayakawa, who was charged in connection with the gassing of Tokyo's subway last March, had visited Russia 20 times over the past three years. Police said he had a notebook with technical details of the rocket, prices, and notes on building a launching-pad in Japan. Officials of the Khrunichev Space Center, which builds the Proton, denied that Hayakawa had visited their center, ITAR-TASS reported. A spokesman suggested he might have contacted the Ukrainian bureau where the Proton was designed. -- Doug Clarke

FEDOROV SKEPTICAL ABOUT SEMI-FIXED RUBLE.
The introduction of a semi-fixed ruble/dollar exchange rate will not help stabilize the Russian economy, State Duma deputy Boris Fedorov argued at the Russian-American Press Center on 10 July, Russian TV reported. The former finance minister claimed that Russia had an average monthly inflation rate of 12% in the first half of 1995, which is even higher than the rate for the same period last year. He said he anticipates the dollar will cost 6,000-7,000 rubles by the end of the year. However, Michel Camdessus, head of the IMF, said that the Russian government's actions "have a good chance of success" according to Kommersant-Daily on 8 July. -- Thomas Sigel

RUSSIA AND INDIA IMPLEMENT JOINT PROJECTS.
Russia and India will implement a number of joint projects totaling $129 million, Finansovye Izvestiya reported on 11 July. India will build a railroad terminal in Russia, while Russia will carry out three projects related to the chemical industry, including a titanium oxide plant, in India. Russia's financial contribution to the projects will be taken from the debt repayments that India owes Russia. -- Thomas Sigel

REDUCTION OF STATE INVESTMENTS AFFECT ECONOMY.
Experts from the Economics Ministry expressed concern at the continuing decline in state-funded investment in Russian industry, Sovetskaya Rossiia reported on 11 July. The share of state investments in total investment equaled 5.2% during the first quarter of 1995, Business-Tass reported. That was down from 7.3% for the first quarter of 1994 and 11.8% in the first quarter of 1993. -- Thomas Sigel

RUSSIANS UNHAPPY WITH THEIR WAGES.
Only 16% of respondents were satisfied with their wages, while 80% were dissatisfied, according to a poll carried out by the All-Russian Foundation for the Study of Public Opinion, Russian TV reported on 10 July. A mere 7% of respondents believe that their salary depends on their own efforts; 21% link it to decisions of the government; and 37% say it depends on the economic well-being of their enterprise. Asked what they would do if they were made redundant, 40% said they would ask friends and relatives for help, 24% said they would go to a labor exchange, and 16% said they would look for a new job on their own. The average monthly wage in May was about 430,000 rubles and the monthly minimum 43,700. -- Penny Morvant



OMRI DAILY DIGEST

Vol. 1, No. 133, 11 July 1995
WORRIES ABOUT ISLAMIC FUNDAMENTALISM IN KYRGYZSTAN.
The Committee for National Safety in Kyrgyzstan is deeply concerned about the growing influence of what it refers to as Islamic fundamentalism in the southern regions of the republic, Russia's Radio Mayak reported on 10 July. Miroslav Niyazov, the committee's deputy chairman, said there are many Muslim activists, who have criminal records, spreading propaganda in the south. Niyazov said there are more than 1,000 (functioning) mosques in the Osh Oblast alone. -- Bruce Pannier

SMALL STEPS TOWARD TURKO-ARMENIAN RAPPROCHEMENT?
An official Turkish delegation led by Gurbuz Capan, head of the Esenyurt community administration in Istanbul, visited Armenia at the invitation of Erevan Mayor Vagan Khachatrian, Segodnya reported on 4 July. According to Segodnya, observers in Erevan took special note of the fact that the delegation laid flowers at a memorial to Armenian genocide victims. -- Lowell Bezanis

CIS

RUSSIAN DUAL CITIZENSHIP IN FORMER SOVIET STATES.
Russia has so far failed to secure dual citizenship for its citizens throughout the newly independent states, according to Rossiiskie vesti on 6 July. Russia has signed an agreement on dual citizenship with Turkmenistan and has already drawn up such treaties with Kyrgyzstan, Belarus, and Tajikistan. Negotiations with other states remain deadlocked. Rossiiskie vesti alleges that ethnic Russians suffer labor discrimination in Lithuania, Georgia, and Azerbaijan and many remain effectively stateless in Latvia and Estonia. The number of Russians living abroad being granted Russian citizenship is on the rise, with 123,000 persons in 1992-1993, 444,000 in 1994, and 110,000 in the first quarter of 1995. -- Michael Mihalka



OMRI DAILY DIGEST

Vol. 1, No. 133, 11 July 1995

CENTRAL AND EASTERN EUROPE

NEW UKRAINIAN JUSTICE MINISTER APPOINTED.
Ukrainian President Leonid Kuchma, continuing with the appointment of a new Ukrainian government, has named Volodymyr Stretovych, chairman of the parliamentary commission on legal policy and judicial reforms, as new justice minister, UNIAR reported on 10 July. Stretovych replaces Vasyl Onopenko. The ministers of culture and nationalities have yet to be appointed. UNIAR reports that acting ministers Mykola Yakovyna and Mykola Shulha will likely be replaced. -- Chrystyna Lapychak

UKRAINIAN OFFICIALS ABROAD.
Ukrainian Foreign Minister Hennadii Udovenko arrived in Israel on 10 July for an official visit, Ukrainian Radio reported. At his meeting with Israeli Prime Minister Itzhak Rabin, talks focused on economic cooperation. It was agreed to set up a joint commission to promote economic ties. Meanwhile, Ukrainian Defense Minister Valerii Shmarov completed his week-long visit to the U.S. On 10 July, he met with Ruth Harkin, U.S. head of corporations and foreign investments, before returning to Kiev the next day. -- Ustina Markus

UPDATE ON BELARUSIAN DISARMAMENT HALT.
Russian Public Television, commenting on 10 July on Belarusian President Alyaksandr Lukashenka's decision to stop transferring the remaining nuclear missiles from Belarus to Russia, said Belarus is earning a negative international image on account of the move. Four months ago, Lukashenka halted dismantling conventional military equipment, which Belarus was obliged to liquidate under the CFE treaty. Neither the Russian Defense Ministry nor the president's administration was informed about Lukashenka's latest move, and both have refused to comment on it. Radio Rossiya reported that a Foreign Ministry official said the reason for the halt was that Russian troops are leaving behind ecologically harmful materials that can be used for neither military nor civilian purposes. -- Ustina Markus

BANKING ISSUES IN THE BALTICS.
Following the collapse of a number of small banks in Lithuania, Finance Minister Reinoldijus Sarkinas said he did not believe Lithuania's largest banks would collapse, Reuters reported on 10 July. Sarkinas was speaking after the failure of Lithuania's eighth-largest bank, Aura Bankas. The largest bank in Latvia, Banka Baltija, collapsed in May. Sarkinas said better laws protecting depositors are being drawn up, but he added that depositors in banks that have already failed will not be reimbursed retroactively since they were warned of the dangers of depositing in the new banks. Some of those institutions had offered up to 100% interest on deposits. BNS the same day reported that Estonian commercial banks will start guaranteeing deposits of up to 20,000 kroons ($10,000) beginning July 1996 and deposits by legal entities as of the year 2000. -- Ustina Markus

RUSSIAN DEPUTY FOREIGN MINISTER IN LATVIA.
Russian Deputy Foreign Minister Sergei Krylov, on a visit to Latvia, met with Foreign Minister Valdis Birkavs, BNS reported. The two leaders agreed to set up a joint commission to solve outstanding issues and increase cooperation. The new body will be headed by Deputy Prime Minister and Communications Minister Andris Gutmanis on the Latvian side; his Russian counterpart has not yet been named. Talks also focused on trade issues, money frozen in Russian banks, illegal immigration, and Latvia's demand that Russia hand over archival materials. The two sides, however, failed to agree on defining their common border. Krylov left for Estonia on 10 July. -- Ustina Markus

PRIVATIZATION IRREGULARITIES IN POLAND.
Stefan Kawalec, who was deputy finance minister in 1994 when Bank Slaski was undergoing privatization, is to stand trial for "irregularities" that took place during that process, Polish and international media reported on 10 July. A leading Finance Ministry official and the bank's director are also to be tried. Bank employees received a share package worth 10% of its capital, while ordinary investors were allowed only three shares each. The initial price, fixed at 500,000 zloty ($25) per share, rose to an equivalent of $320. According to a parliamentary commission, the state lost about $620 million because the share price was too low. Meanwhile, President Lech Walesa's spokesman on 10 July said the president will veto the law on the privatization and commercialization of state enterprises. Walesa criticized the possibility that commercialization (transforming an enterprise into a company governed by commercial law) will not eventually lead to privatization, Polish media reported the next day. -- Jakub Karpinski

CZECH HALF-YEAR INFLATION ON STEADY COURSE.
Consumer prices in the Czech Republic rose by 1.1% in June, bringing inflation for the first half of 1995 to 5.0%, the Statistics Office reported on 10 July. Government and Czech National Bank officials said the aim of keeping inflation below 10% this year was on course, but other analysts said expected food price hikes could push up the index in the second half of the year. Increases in the price of potatoes, gas, and electricity accounted for much of the June rise. In the year since June 1994, prices rose 10%, a decrease of 0.2% in year-on-year inflation from May. -- Steve Kettle

SLOVAK RULING PARTY TO BAR SOROS.
The Movement for a Democratic Slovakia (HZDS) is to bar U.S. financier and philanthropist George Soros from entering Slovakia because of his refusal to apologize for statements criticizing Slovak Premier Vladimir Meciar (see OMRI Daily Digest, 7 July 1995). Soros, in a statement issued on 9 July, refused to apologize for his remarks, which were made at the recent economic forum in Crans Montana, Switzerland. But he said he regretted that his remarks have offended some parties in Slovakia, stressing that he did not intend to damage the interests of Slovakia. Soros also alleged that Slovakia's interests are being harmed by Meciar's government, which is pursuing policies that will disqualify Slovakia from membership in West European institutions. The HZDS Political Council on 10 July said Soros has confirmed his "anti-Slovak" sentiments. It announced that the party will initiate a move through the Foreign Ministry to pronounce Soros persona non grata in Slovakia. -- Sharon Fisher

SLOVAK PREMIER IN PORTUGAL.
Vladimir Meciar, at the start of a three-day visit to Portugal and Spain, met on 10 July with his Portuguese counterpart, Anibal Cavaco Silva. TASR quoted Silva as saying Portugal supports the efforts of Slovakia and the other Visegrad countries toward EU integration. He also stressed the need to strengthen bilateral economic relations. In other news, a poll taken by the FOCUS agency in the first half of June indicated that only 10.8% of Slovaks believe the cabinet's foreign policy is "correct," 49.2% say it is "partly correct and partly incorrect," and 22% call it "incorrect." In May 1994, during Jozef Moravcik's term as premier, 26.1% said foreign policy was correct and 10.7% considered it incorrect, Sme reported on 11 July. The Slovak Information Agency, which was recently established by the government to improve Slovakia's image abroad, recently began operating. According to Slovenska Republika on 11 July, the SIA plans to distribute information about Slovakia and focus on serving foreign journalists. -- Sharon Fisher

CHINA PRAISES HUNGARY'S POLICIES.
Chinese President Jiang Zemin, on a three-day visit to Hungary, has hailed Hungary's "one-China policy," international media reported. He also said China was interested in expanding economic ties with Hungary. Since both countries are heading toward a market economy, they "should put aside differences and bring their relations to a new high," he commented. Foreign Affairs spokesman Chen Jian, speaking after Jiang's meetings with Hungarian President Arpad Goncz, Prime Minister Gyula Horn, and Parliament Chairman Zoltan Gal on 10 July, noted that "the visit so far has been a complete success." Among the projects discussed were Hungary's participation in building the Shanghai underground system, exporting buses and an assembly plant to China, as well as cooperation in agriculture and banking. -- Jiri Pehe



OMRI DAILY DIGEST

Vol. 1, No. 133, 11 July 1995
SERBS GIVE SREBRENICA AN ULTIMATUM.
International media on 11 July reported that Bosnian Serb forces have given Bosnian government forces and the 42,000 civilians in Srebrenica until dawn on 13 July to give up their weapons and leave town. Some of the civilian refugees appear to have already begun leaving for the surrounding hills. Serbian artillery on 10 July also pounded Sarajevo and Zepa. The Frankfurter Allgemeine Zeitung on 11 July said the Bosnian government has accused the UN of "deliberate inactivity despite the highly dramatic developments" around Srebrenica, adding that if the Serbs take the town there may be little sense in maintaining any UN presence in Bosnia-Herzegovina. Vecernji list added that women and children in Tuzla are threatening to blockade local UN forces unless UNPROFOR turns the Serbs away from Srebrenica. -- Patrick Moore

WHAT DO THE SERBS WANT?
UN Secretary-General Boutros Boutros Ghali on 10 July said the UN might call in NATO air strikes if necessary. When a Dutch commander sought air support, however, the UN civilian headquarters hesitated until the immediate danger passed. The International Herald Tribune on 11 July quoted UN officials as saying they do not believe the Serbs actually intend to take Srebrenica but merely want to embarrass the Bosnian government and the UN. According to this view, Srebrenica represents no threat to the Serbs, who, in any event, do not need 42,000 more Muslim civilians on their hands. The BBC said that as of 11:00 a.m. local time on 11 July, Dutch peacekeepers continued to patrol Srebrenica but there was no word as to whether the Serbian advance was continuing. -- Patrick Moore

CAN THE UN RECOVER CREDIBILITY?
International media on 11 July discussed how the international organization has found itself in its current predicament and whether it can be taken seriously again. They maintain that it has only itself to blame for repeatedly failing to make use of superior force in response to aggression by irregulars backed by the rump Yugoslav army and command structure. Nor did the UN enhance its status in the Balkans by making a secret deal to free the hostages the Serbs took in late May and effectively giving into Bosnian Serb leader Radovan Karadzic's blackmail. Media reports added that the UN continues to display indecisiveness by questioning whether its own mandate in Srebrenica allows it to attack the Serbs only if the peacekeepers are fired on or if the town itself is invaded. -- Patrick Moore

FERAL TRIBUNE UPDATE.
Government authorities in Split have begun legal proceedings against the three thugs who publicly stole and burned copies of the independent satirical weekly Feral Tribune on 27 June. Journalists suspected the authorities of at least complicity in the young men's actions. The three are charged with offenses against the press and could be fined or receive up to a year in prison, Novi list reported on 11 July. -- Patrick Moore

MACEDONIAN-ETHNIC ALBANIAN TALKS IN GENEVA FAIL.
Negotiations between the Macedonian government and the three main ethnic Albanian parties in Macedonia have ended without any success, international media reported. Macedonia's ministers of education, justice, and internal affairs participated in the talks, under the mediation of Gerd Ahrens from the Geneva Conference on the Former Yugoslavia. The talks focused on higher education, the legalization of the self-proclaimed Albanian-language university in Tetovo, local self-administration, and the use of Albanian as an official language. Meanwhile, 10 ethnic Albanians convicted in June 1994 of forming a paramilitary group are to be amnestied by Macedonian President Kiro Gligorov in August. Albania had called their trial a "rigged political process." Radio Tirana said the move was important for "easing tension in interethnic relations and starting closer bilateral relations and cooperation." -- Fabian Schmidt

ENORMOUS DAMAGE FROM DOWNPOUR IN MACEDONIA.
Heavy rain, storms, and subsequent flooding on 6 July have caused enormous damage in southeastern Macedonia, MIC reported on 10 July. The damage is estimated at several hundreds of millions of dollars. In the regions of Kavadarci and Negotino, which were hardest hit, two-thirds of the crops were destroyed and 3,000 houses damaged. One person is reported missing in Kavadarci. The rail line and highway from Skopje to Gevgelija was also damaged. President Kiro Gligorov, Prime Minister Branko Crvenkovski, and Defense Minister Blagoj Handziski visited the region over the weekend, promising state assistance. -- Stefan Krause

ROMANIAN, HUNGARIAN FOREIGN MINISTERS' MEETING CONFIRMED.
Radio Bucharest on 10 July reported that Teodor Melescanu and Laszlo Kovacs will meet in Bucharest on 19-20 July to discuss the "the finalization of the basic treaty." Radio Bucharest, citing Radio Budapest, quoted Kovacs as saying that neither the new education law in Romania nor other recent "extremist anti-Hungarian" measures are good omens for the signing of the treaty. The education law, he said, contravenes European norms and international standards, which, according to Romania's Constitution, should prevail over domestic legislation. The law also violates the spirit of those parts of the Hungarian-Romanian treaty on which agreement has already been reached, Kovacs said. Meanwhile, Radio Bucharest on 10 July reported that Col. Gen. Dumitru Cioflina, chief of staff of the Romanian army, began a three-day visit to Budapest at the invitation of his Hungarian counterpart, Sandor Nemeth. -- Michael Shafir

ROMANIAN-WESTERN MILITARY RELATIONS.
Portuguese Defense Minister Antonio Figueiredo Lopes and his Romanian counterpart, Gheorghe Tinca, signed a military agreement in Bucharest on 10 July, Radio Bucharest and international media reported. Figueiredo Lopes was received the next day by President Ion Iliescu. The agreement provides for the exchange of information and visits as well as joint exercises and training programs. In other news, Gebhardt von Moltke, NATO assistant secretary-general for political affairs, was received on 10 July by Foreign Minister Melescanu and Chamber of Deputies chairman Adrian Nastase. Von Moltke is attending an international seminar in Bucharest on NATO's peacekeeping role. -- Michael Shafir

ROMANIAN PREMIER IN PAKISTAN.
Nicolae Vacaroiu on 10 July paid a one-day visit to Pakistan, the last leg of his Asian trip, Radio Bucharest reported. Vacaroiu held talks with his Pakistani counterpart, Benazir Bhutto, and President Farooq Leghari. The two sides signed agreements on scientific and technological cooperation, trade, and the protection of investments. Bhutto said Pakistani businessmen may be interested in buying Romanian enterprises slated for privatization. -- Michael Shafir

MOLDOVAN PRESIDENT ON ECONOMIC REFORM.
Mircea Snegur, speaking on Moldovan Television on 10 July, said it was important to develop the securities market launched by the opening of the stock exchange in June, Infotag reported the next day. He stressed that the banking system must be restructured, the taxation system overhauled, and a mechanism set up to deal with the bankruptcy of inefficient enterprises. Snegur also said that agrarian reform was proceeding "with great difficulty" because conditions for fair competition in agriculture have not been created. Finally, he mentioned the necessity to restructure the social security system. -- Michael Shafir

IRANIAN FIRST VICE PRESIDENT IN BULGARIA.
Hassan Habibi arrived in Bulgaria for a three-day visit on 10 July, international agencies reported the same day. Habibi and Bulgarian Prime Minister Zhan Videnov agreed to work together to fight drug trafficking and to improve facilities for trade payments in order to boost bilateral trade. Bulgarian government spokesman Nikola Baltov said trade between the two countries fell from $335 million in 1985 to $114 million in 1994, with Bulgarian exports totaling just $10 million. Baltov said Bulgaria hopes to restore "agricultural and food exports for Iran," while Iran will provide Bulgaria with additional oil supplies. Habibi will meet President Zhelyu Zhelev and Parliamentary President Blagovest Sendov on 11 July. -- Stefan Krause

FORMER BULGARIAN PRIME MINISTER TO RUN FOR MAYOR OF SOFIA.
Reneta Indzhova will run in the elections for mayor of Sofia, Standart reported on 11 July. Her candidacy is supported by the People's Union, an opposition party that has 18 of the 240 seats in the Bulgarian parliament. The opposition agreed last month to cooperate in local elections; but the Union of Democratic Forces is reluctant to support Indzhova, since it wants to score a success in Sofia itself, Kapital reported. Indzhova headed an interim government from September 1994 to January 1995 and was the first woman to become Bulgarian premier. According to opinion polls, she has a good chance of winning the elections in the Bulgarian capital. -- Stefan Krause

BOUTROS GHALI IN ATHENS.
UN Secretary-General Boutros Boutros Ghali met with Greek Prime Minister Andreas Papandreou and Foreign Minister Karolos Papoulias on 10 July, Western agencies reported the same day. They discussed the war in Bosnia, Greece's relations with Macedonia and Turkey, and the situation in Cyprus. Boutros Ghali called the talks "extremely fruitful and positive," saying he was confident Greece's problems with its neighbors will be settled quickly and peacefully. "Negotiations are going on between Athens and Skopje, and I believe we are near to finding a solution," Boutros Ghali said after the meeting with Papandreou and Papoulias. He also said the UN will continue its efforts to find a "peaceful solution" to the Cyprus issue. -- Stefan Krause

[As of 1200 CET]

Compiled by Victor Gomez and Jan Cleave




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