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Newsline - December 29, 1995


YELTSIN RETURNS TO KREMLIN.
Russian President Boris Yeltsin returned to his office in the Kremlin on the morning of 29 December after a two-month absence due to heart trouble. In an interview with ITAR-TASS, Yeltsin said the two most important international events of the year were the 50th anniversary of the UN and the Dayton peace accord. The most important domestic events were the holding of the Duma election and, for himself, the birth of his fourth grandchild. -- Peter Rutland

GOVERNMENT PURGE IN OFFING?
On 28 December, President Boris Yeltsin gave Prime Minister Viktor Chernomyrdin two days to fire those responsible for "sabotaging" the government's economic program, NTV reported the same day. Presidential spokesman Sergei Medvedev said the president was angry with the Economics Ministry because it had failed to provide the investments he had promised during a visit to the Krasnoyarsk combine plant last year. The Finance Ministry is also being criticized for failing to release routine budget funds. The acting head of the Defense Ministry's finance department, General Vasilii Kuznetsov, said that his ministry did not receive any money in December, according to Interfax of 28 December. ITAR-TASS on 25 December quoted Yurii Malyshev, the head of Rosugol, as saying that the 500 billion rubles ($108 million) the government promised for coal miner's wages had also not been paid. -- Peter Rutland

OUR HOME IS RUSSIA SUPPORTS YELTSIN FOR RE-ELECTION.
Although Chernomyrdin is frequently mentioned as a presidential contender, representatives of his bloc, Our Home Is Russia (NDR), continue to express loyalty to President Yeltsin. Sergei Belyaev, leader of the NDR Duma faction, said his party will select a presidential candidate at a conference in January or February, and will support Yeltsin if he runs for re-election, Russian media reported on 28 December. He also said the NDR will have as many as 80-100 deputies in the new Duma, providing the only real competition for the Communists in parliament. The KPRF will have at least 158 Duma seats. NDR won 44 on the party list and 10 single-member districts, but Belyaev said many independents were joining the faction as well. -- Laura Belin

LEBED TO RUN FOR PRESIDENT.
Retired general Aleksandr Lebed, a leader of the Congress of Russian Communities (KRO), announced on 28 December that he intends to run for president in 1996, Russian and Western media reported. Lebed reportedly hopes that his candidacy will be supported by the Communist Party of the Russian Federation (KPRF). During the campaign he suggested several times that KRO and the Communists form an alliance, but the idea was rebuked by Yurii Skokov, another KRO leader. KRO had a disappointing showing in parliamentary elections and failed to make the 5% cut-off. However, most Russian commentators are already saying that if Lebed were to win Communist backing he would be the clear favorite in June's presidential race. -- Laura Belin

COMPETITION LIKELY FOR COMMUNIST PRESIDENTIAL NOMINATION.
Lebed's announcement adds another wrinkle to the KPRF's plans to choose a presidential candidate in January. The party has not yet formally responded to Lebed's offer of an alliance during the presidential campaign. KPRF leader Gennadii Zyuganov, who is considered to lack the charisma needed to win a presidential election, has insisted that the Communists will unite behind a single candidate. Aman Tuleev, the outspoken governor of Kemerovo who was third on the KPRF party list for the Duma elections, told Radio Rossii on 26 December that he will run for president if Yeltsin runs for re-election. (Tuleev finished fourth in the 1991 presidential elections with 6.8% of the vote.) Furthermore, Petr Romanov, a prominent Krasnoyarsk factory director elected to the Duma on the KPRF list, continues to prepare for a presidential bid. -- Laura Belin

GORBACHEV ALSO LEANING TOWARD PRESIDENTIAL BID.
Former Soviet President Mikhail Gorbachev said he is leaning toward running for president in 1996 as part of a "broad coalition of democratic forces," Izvestiya reported on 28 December. He added, "I cannot remain on the sidelines during a time of difficult ordeals for Russia." -- Laura Belin

EX-DEPUTIES TO BE GIVEN GOVERNMENT JOBS.
According to a statement issued by Duma Speaker Ivan Rybkin, all the deputies who failed to be re-elected in December will be given positions in top government agencies and Moscow residency permits, ITAR-TASS reported on 29 December. Only 93 of the Duma's 450 deputies won re-election on 17 December. Officials of the Moscow Mayor's Office complain that almost all the deputies who lost their seats in the recent election are refusing to leave the apartments they received from the city, NTV reported on 26 December. The city has supplied 250 deputies with apartments since 1993. The deputies should in theory leave their apartments by the end of January. In the meantime, new deputies will be accommodated in the Hotel Rossiya. -- Peter Rutland

PRESIDENTIAL COUNCIL RECOMMENDS 20 DECREES ON LOCAL SELF-GOVERNMENT . . .
The Presidential Council on Local Self-Government ruled that the federal government should issue about 20 decrees to make the law on self-government workable, ITAR-TASS reported on 28 December. Sergei Filatov, head of the presidential administration, said bills are urgently needed in the areas of self-government structure, local financing, and taxation. Filatov added that he fears that local governments could become "sovietized" following the Communist Party's recent electoral victory. -- Anna Paretskaya

. . . WHILE REGIONAL LAWS TO BE EXAMINED.
Filatov also said the Presidential State Legal Administration (GPU) has prepared Constitutional Court cases against various bills passed in 70 of the country's 89 federation subjects that allegedly contradict the Russian constitution, Segodnya reported on 27 December. Filatov said President Yeltsin would soon establish a commission to harmonize local legislation with the constitution. GPU experts say they have also found several examples of federal laws that contradict the constitution as well as other federal legislation. On 29 December, President Yeltsin vetoed a Duma bill on relations between krais and oblasts composed of autonomous okrugs, saying it contradicted the constitution. -- Anna Paretskaya

INGUSH PARLIAMENT CALLS FOR ABOLITION OF INTERIM COMMITTEE.
On 28 December, the Ingush parliament appealed to President Boris Yeltsin and the Russian government to abolish the interim committee created to deal with the situation in North Ossetiya's disputed Prigorodny Raion following violent clashes between Ossetiyans and Ingush in the autumn of 1992, ITAR-TASS reported. The parliament argues that the committee has not been able to stabilize the situation in Prigorodnyi Raion and proposed that special rule be imposed on the districts that have been set aside for the repatriation of Ingush refugees. The presidents of North Ossetiya and Ingushetiya, Akhsarbek Galazov and Ruslan Aushev, met with Yeltsin's aide for nationality issues, Nikolai Yegorov, in Moscow on 16-17 December and subsequently ratified an agreement on normalizing relations between their respective republics. -- Liz Fuller

FOREIGN TRADE MINISTER IN TEHRAN.
Russian Deputy Prime Minister and Minister of Foreign Trade Oleg Davydov initialed two intergovernmental economic protocols with his Iranian counterpart during a three-day visit to Tehran, Russian and Western agencies reported on 28 December. One of the protocols covers mutual debt repayment. The other which outlines bilateral economic cooperation for the next 10 years, calls for the creation of joint oil and gas companies, a move certain to draw criticism from the U.S. which has imposed a unilateral trade embargo on Iran. At a press conference Davydov termed Iran a "strategic partner" for Russia. The two ministers indirectly threatened Azerbaijan by jointly declaring that under a pending agreement on a new legal regime for the Caspian Sea, no single country will be permitted to exploit the sea's mineral resources. -- Scott Parrish

YELTSIN SUSPENDS SANCTIONS AGAINST RUMP YUGOSLAVIA.
On 28 December, President Yeltsin issued a directive ordering the suspension of UN economic sanctions against rump Yugoslavia, Russian and Western agencies reported. The directive was issued in accordance with UN Security Resolution 1,022, passed on 22 November, which suspends the sanctions as part of the Dayton agreement. The directive does not suspend Russian participation in sanctions against the Serb-held areas of Bosnia, however, which remain in place until Bosnian Serb military forces withdraw behind demarcation lines laid out in the Dayton accord. Meanwhile, in New York, Russian UN Delegate Sergei Lavrov called on the Security Council to adopt a resolution condemning the "gross and mass violations of human rights" by Croatian authorities in Krajina, citing a recent report on the issue by the UN secretary general. -- Scott Parrish

RUSSIA TO RESTRICT TEXTILE IMPORTS.
Dmitrii Sukhoparov, the head of the department for regulating foreign trade at the Foreign Economic Relations Ministry, announced that Russia will soon introduce quotas limiting textile imports from the EU, ITAR-TASS reported on 28 December. Sukhoparov complained that the EU limits Russian textile exports to $180 million a year while it sells $740 million worth of its own textiles to Russia. The Russian Justice Ministry recently prepared a document authorizing the imposition of such anti-dumping measures, which Sukhoparov claimed are fully in accord with GATT and WTO rules. Import quotas are also being considered for other items, such as cash registers. -- Peter Rutland

GOVERNMENT SELLS 16% STAKE IN LUKOIL.
The Russian investment company Nikoil has won a share auction for a 16% stake in LUKoil, Russia's largest oil company, ITAR-TASS reported on 28 December. Nikoil's offer to invest 800 billion rubles ($170 million) in LUKoil in return for the shares beat out the sole rival bidder. Earlier this month, the State Privatization Committee transferred a 5% federal stake in LUKoil to the company itself and Imperial Bank in exchange for a $35 million loan. Nikoil is thought to be a front company for LUKoil, having been created in order to trade in the shares of LUKoil and other petroleum companies. If so, it will be another entry on the list of auctions with predetermined outcomes. Earlier this week, one of the few privatization auctions to be won by an outsider, STET's bid for a stake in Svyazinvest, fell through. -- Natalia Gurushina

TWO MORE OIL COMPANIES HOLD AUCTIONS.
On 28 December, Neftyannaya Finansovaya Kompaniya and Stolichnyi Bank bought 51% of the shares in Sibneft with a Menatep Bank guarantee, ITAR-TASS reported. The bid was $100.3 million, $300,000 above the start price. On the same day, the auction of 15% of the shares in Nafta-Moskva, the former Soyuznefteeksport, was held for the second time. It was won with a bid of $20.01 million by Nafta Moskva and Unibestbank, with a guarantee from Onekismbank (which also organized the auction). The bid was just $10,000 above the reserve price. The first sale of Nafta shares, on 17 November, was reversed after the winner proved unable to come up with the money. -- Peter Rutland



NEW CHAIRMAN OF UZBEK CONSTITUTIONAL COURT ELECTED BY PARLIAMENT.
The Uzbek Oliy Majlis elected Bahodir Ishanov to head the country's Constitutional Court, according to an Uzbek Radio report cited by the BBC on 28 December. Ishanov, who was President Islam Karimov's nominee, is currently a the chairman of the Oliy Majlis Committee on Legislation and Court Issues. Under Uzbek law, Ishanov must step down from his position in the Oliy Majlis to assume his new post. A deputy chairman and two standing members were also elected to the Constitutional Court. -- Roger Kangas

107 DEAD AS CYCLONE WRECKS NORTH KAZAKHSTAN.
At least 107 people are dead and many more are missing following a devastating cyclone and bitter cold weather in the Akmola, Kokshetau, Kostanai, and Karaganda oblasts in north-central Kazakhstan, Karavan-Blitz reported on 28 December. -- Bhavna Dave in Almaty

OBSERVERS SATISFIED WITH KYRGYZ ELECTIONS.
Representatives of the UN Development Program and the OSCE in Kyrgyzstan released a statement on 28 December describing the country's recent presidential election as "generally free and open" despite some violations of voting procedure, Reuters reported. The statement noted that there had been some reported cases of the titular head of a household voting on behalf of an entire family. Pre-election registration rules for candidates and the exclusion of three candidates from the election for allegedly violating those rules "raised some legal and constitutional concerns," but the observers "for the most part found the presidential elections to be a step forward" from the country's February parliamentary elections. The final results show that with 86% of eligible voters participating, Akayev won 71.6% of the vote. -- Bruce Pannier



EXPORT-IMPORT BANK TO LEND $230 MILLION TO UKRAINE.
The Export-Import bank of Japan will lend Ukraine 24 billion yen ($230 million) to cover the financial aid the Japanese government has committed itself to offering Ukraine, AFP reported on 28 December. The bulk of the credit, 18 billion yen, will be extended in syndicated loans in cooperation with the World Bank, and only six billion yen would come directly from the Export-Import Bank. Japan promised the aid last March to help Ukraine stabilize its economy and dismantle the nuclear weapons on its soil. -- Ustina Markus

UKRAINE WILL NOT PARTICIPATE IN BOSNIAN PEACE FORCE.
Ukraine has informed the NATO peace Implementation Force (IFOR) that it would not be able to participate in its operations in Bosnia because of financial difficulties, AFP reported on 28 December. IFOR chief-of-staff Lt. Gen. William Carter said Ukraine's withdrawal should not be a setback for the NATO-led force since other countries have come forward with greater contributions than anticipated. Ukraine will continue to provide Antonov transport craft for the Bosnian operations. -- Ustina Markus

HEAD OF BELARUSIAN CONSTITUTIONAL COURT ASKED TO RESIGN.
The head of President Alyaksandr Lukashenka's administration, Mikhail Myasnikovich, has asked the head of the Constitutional Court, Valerii Tikhinya, to resign, radio Ekho Moskvy reported on 28 December. Myasnikovich reportedly told Tikhinya that if he did not leave his post willingly, a decision to remove him would be made by the president. Lukashenka has reportedly been putting pressure on Tikhinya for some time. The court has found seven of Lukashenka's presidential decrees to be unconstitutional. In other news, Belarusian radio reported that although the cabinet of ministers has allocated three billion Belarusian rubles to the new parliament so that it can open, the money has not appeared on the secretariat's account. -- Ustina Markus

BELARUSIAN TRADE UNIONS SUSPEND STRIKE PLANS.
Belapan reported on 28 December that The Federation of Trade Unions has decided to remove
from its January agenda plans to hold a national strike. The decision was taken because the cabinet of ministers is reportedly taking the unions demands into consideration. The Independent Trade Unions of Belarus are reportedly planning to go ahead with their preparations for a national strike in January. The announcement came soon after President Alyaksandr Lukashenka warned that any mass protest actions could destabilize the country. The Federation of Trade Unions was the official union during the Soviet era and has often been more amenable towards the government than the Independent Trade Unions. -- Ustina Markus

TWO PRIVATE ESTONIAN TV STATIONS TO MERGE.
The private television stations RTV and EVTV--which currently broadcast on alternate days on the same channel--will combine their programs from the beginning of 1996 as the first step toward their full merger as new station TV3, BNS reported on 27 December. Some 70-80% of RTV's current shareholders are to take part in the founding of the new station while only one shareholder, Sweden's Kinnevik, will participate from EVTV. -- Saulius Girnius

FORMER LATVIAN AGRICULTURE MINISTER INDICTED.
A prosecutor told BNS on 28 December that Dainis Gegeris has been indicted for neglect of duty and abuse of service authority. The charges were brought in the case against the Lata International firm that was founded in 1992 to service foreign loans, but squandered the money. It was declared bankrupt by the Latvian Commercial Court on 22 November. The prosecutor noted that the new prime minister, Andris Skele, who was deputy agriculture minister at that time, did not play any role in the Lata case. -- Saulius Girnius

UNPRODUCTIVE LITHUANIAN PARLIAMENT SESSION ON BANK CRISIS.
The extraordinary Seimas session called on 28 December to pass a government resolution on guaranteeing the stability of banks did not achieve its purpose, Radio Lithuania reported. After the opposition proposed an alternative measure, President Algirdas Brazauskas called the government resolution "somewhat abstract" and proposed the formation of a work group that would present a combined proposal to the parliament the next day. He said that the blame for the current problems should be shared by the government, the Bank of Lithuania, the leaders of commercial banks, as well as the credit givers and receivers. He urged the creation of a better bank supervision system. -- Saulius Girnius

NEGOTIATIONS ON MINISTERIAL NOMINATIONS IN POLAND.
The representatives of the ruling coalition of the Democratic Left Alliance (SLD) and the Polish Peasant Party initially agreed on 28 December on the appointment of Jerzy Konieczny as Internal Affairs Minister, and Dariusz Rosati as Foreign Affairs Minister, Rzeczpospolita reported on 29 December. Konieczny, a professor of law, headed the State Security Office in 1992-1993 and declared his support for Lech Walesa. Rosati, a professor of economics and former Communist Party member, was the SLD candidate to be Finance Minister and Deputy Prime Minister in 1994, when Walesa blocked his nomination. The choice of the Defense Minister has not been decided, and, according to Polish dailies of 29 December, the SLD would like to nominate former Deputy Minister Jerzy Milewski, who was a Walesa supporter and then became President Aleksander Kwasniewski's security advisor. -- Jakub Karpinski

POLISH SECURITY OFFICE PROMISES SUPPLEMENTARY EVIDENCE IN OLEKSY'S CASE.
The Deputy Chief of the State Protection Office (UOP), Jerzy Nozka, said after a meeting with Sejm speaker Jozef Zych on 28 December that his office would give military prosecutors the supplementary evidence referring to alleged contacts between Prime Minister Jozef Oleksy and foreign (Soviet/Russian) intelligence, before 20 January. The prosecutors office formulated 12 questions to the UOP concerning the material former Internal Affairs Minister Andrzej Milczanowski delivered on 19 December. The chief of the Military Information Service (WSI), General Konstanty Malejczyk, said before the end of the year the WSI would provide the prosecutors with information on the activities of foreign countries' secret services in Poland (the prosecutors had demanded such a report). Contradicting what he said on 27 December, Oleksy said he does not exclude taking a temporary leave of office, Rzeczpospolita reported on 29 December. -- Jakub Karpinski

POLISH CONSTITUTIONAL TRIBUNAL ON TAXES.
The Polish Constitutional Tribunal has ruled that the tax law adopted for the first time by the Sejm on 13 October is unconstitutional, saying that vacatio legis, or the period for adaptation of the law, was too short. The law provided for a six-grade taxation scale of 19, 21, 24, 31, 38, and 45%, instead of the current 21, 33, and 45%. The last three thresholds will be in force for 1996, the Polish press reported on 29 December. The court's decision ended the legal fight between former President Lech Walesa on the one side and the government and parliament on the other. Walesa vetoed the bill on 27 November, and the Sejm overrode the president's veto on 1 December. Instead of signing the bill, Walesa sent it to the tribunal on 4 December. -- Jakub Karpinski

FIRE AT CZECH NUCLEAR PLANT.
A small fire broke out on 28 December at the nuclear power station at Dukovany in southern Moravia but was extinguished within 20 minutes, Czech media reported. Officials of the state nuclear security agency said the fire started in a transformer serving the plant's lighting system. No one was injured and the fire did not cause any safety problems. The plant is near the border with Austria, which has repeatedly asked the Czech government to close the station on safety grounds. Officials said the Austrian embassy in Prague was informed of the fire. They stressed that similar incidents happen about twice yearly, but so far Dukovany's reactor and safety systems have not been affected. -- Steve Kettle



U.S. LIFTS SANCTIONS AGAINST RUMP YUGOSLAVIA.
U.S. President Bill Clinton announced on 28 December that Washington has suspended its sanctions regime against Belgrade. The suspension, which went into effect immediately, opened the way for fuel supplies and mechanical equipment to flow from the U.S. to Serbia, halted by presidential orders issued from June 1992. Clinton said in his statement that "we insisted on a credible reimposition mechanism to ensure no backsliding on the commitments made by the Serbs." Nasa Borba on 29 December reported that on the previous day Russia also suspended sanctions against the rump Yugoslavia. -- Stan Markotich

NATO PLEASED WITH IMPLEMENTATION OF BOSNIAN TREATY.
The commander of NATO ground forces, Lieutenant General Sir Michael Walker, said that "it appears that all parties are demonstrating a spirit of cooperation in complying with the peace agreement . . . We are [however] in [the] early days, it is a honeymoon period." He added that the first 30 days would be decisive because all three sides must disarm their militias and civilians by 20 January. IFOR commander Admiral Leighton Smith echoed Walker's optimism, saying that he was "very happy at what has been achieved in the first week of the mission." The International Herald Tribune and the Frankfurter Allgemeine Zeitung carried the reports on 29 December. -- Patrick Moore

TOP NATO OFFICIAL IN BELGRADE.
NATO commander for Europe, U.S. General George Joulwan, arrived in Belgrade on 28 December and met with several rump Yugoslav officials, including army chief of staff Momcilo Perisic and Serbian President Slobodan Milosevic. Following his two-hour talks with Milosevic, Joulwan said the meetings were "very productive" and conveyed "appreciation for the transit of IFOR, particularly American aircraft here in Belgrade, and allowing forces to transit through Serbia to Bosnia." Joulwan was accompanied on his visit by 54 U.S. soldiers, who shall become the first NATO troops to cross into Bosnia from the rump Yugoslavia. -- Stan Markotich

WEATHER PROVES TO BE IFOR'S BIG ENEMY.
NATO troops have been having to deal with threats not from the locals but from the elements (See OMRI Daily Digest, 28 December 1995). International media reported on 29 December that U.S. efforts to build a 310-meter pontoon bridge over the Sava River for U.S. troops have been held up by the floods. The waters also hit their camp at Zupanja after destroying a protective barrier. Senior U.S. and Croatian army officers have agreed to work together on the construction of the bridge. Meanwhile, the Czech daily Mlada fronta Dnes said that American soldiers are preparing for a longer stay than planned at their bases in Hungary. -- Patrick Moore and Daria Sito Sucic

BOSNIAN SERBS WAIT FOR SMITH'S DECISION.
In accordance with the Bosnian Serbs' request to IFOR commander Admiral Leighton Smith, asking for about a year's delay in the transfer of authority of the Serb-held parts of Sarajevo to the Bosnian government (See OMRI Daily Digest, 27 December 1995), Bosnian Serb Parliamentary Speaker Momcilo Krajisnik said at Pale that they will wait for the decision until 30 January. "If [the] response is negative, we'll still have enough time to displace people, property and state enterprises," Beta quoted Krajisnik as saying on 29 December. Krajisnik also claimed that an agreement on certain corrections of Dayton's territorial maps was reached with the "Muslim side" relating to swaps of some Muslim and Serb villages in eastern Bosnia. -- Daria Sito Sucic

HUNGARIAN RESPONSE TO ROMANIAN RECONCILIATION INITIATIVE.
The Bucharest daily Evenimentul zilei reports on 29 December that the Romanian ambassador to Budapest, Ioan Donca, has received the Hungarian response to President Ion Iliescu's initiative for a "historic reconciliation" between the two countries. No details were provided. The daily also wrote that Foreign Minister Teodor Melescanu sent a letter to his Hungarian counterpart, Laszlo Kovacs, including Bucharest's response to the latest proposals made by Hungary on the basic treaty between the two countries. -- Michael Shafir

MOLDOVA REJECTS TURNING RUSSIAN CONTINGENT INTO PEACEKEEPING FORCE.
The Moldovan delegation to the Joint Control Commission on 28 December issued a statement rejecting the proposal to turn the Russian contingent in Transdniester into a peacekeeping force. The proposal was made earlier this year by Lt. Gen. Aleksandr Sokolov, deputy commander of the Russian Land Force. According to Infotag, the statement says the proposal is unacceptable "due to a certain politicization of the contingent servicemen and their failure to remain unbiased in the conflict." -- Michael Shafir

BULGARIAN PRESIDENT DEMANDS MEDIA CHIEF'S OUSTER . . .
Zhelyu Zhelev publicly demanded that Vecheslav Tunev, Director-General of Bulgarian National Radio, submit his resignation, international media reported on 28 December. Prompting the call was an incident on 18 December, when seven state radio employees were dismissed by Tunev after alleging that management was censoring their work and following assurances by Tunev himself that they would not be fired (See OMRI Daily Digest, 19 December 1995). Zhelev called the firings "an outrage" and added that the one responsible "should not go unpunished." The president made his remarks following meetings with members of Free Speech Forum, a journalists' organization devoted to tracking the conditions affecting the freedoms of the media. -- Stan Markotich

. . . AND PARDONS CONVICTED COMMUNIST OFFICIAL.
Reuters on 28 December reported that Zhelev exercised his constitutional prerogative and pardoned Stoyan Ovcharov, a former Minister of Economy and Planning under communist dictator Todor Zhivkov. Ovcharov was in the second year of a nine-year sentence for embezzling funds that went to finance the education of Zhivkov's grandson. Zhelev cited Ovcharov's ill health, and said that humanitarian considerations led to the pardon. Former Prime Minister Georgi Atanasov (Ovcharov's co-defendant) was pardoned in 1994 after serving less than one year of his ten-year sentence. -- Stan Markotich

MACEDONIAN PARLIAMENT APPROVES BUDGET WITH SMALL DEFICIT.
The Macedonian parliament on 27 December approved the 1996 budget, which will be in deficit by about 3 billion denars ($79 million), about 4.5% of the GDP, Nova Makendonija reported the next day. The shortfall will be covered entirely by credits from international financial institutions. The budget is based upon a macroeconomic framework assuming 6% inflation, an exchange rate of 27 denar/DM, 2% growth of social product, a freeze of salaries in the budget sphere at the level of August 1995, the abolition of vacation pay, a reduction in the number of social welfare recipients, and continued reform of the banking system and customs service. In parliamentary discussions, cuts in agricultural subsidies and social welfare spending sparked the most controversy. -- Michael Wyzan

BULGARIAN ATHLETES OPEN BANK, BULGARIAN GOVERNMENT TO OPEN ROADS.
A group of prominent athletes, including soccer great Hristo Stoichkov, established a commercial banking enterprise on 26 December, dubbed National, 24 Chasa reported the following day. Among the first acts undertaken by management was to offer 101 free shares, each valued at roughly $1.5, to former communist dictator Todor Zhivkov, in what is widely regarded in the Bulgarian media as a publicity stunt. It is unclear whether Zhivkov, under house arrest, has claimed the shares. In a separate development, Reuters on the same day reported that the Bulgarian government plans a massive upgrading of the country's infrastructure over the next three years. Transport Minister Stamen Stamenov was quoted as saying that they will be able to rehabilitate some 2,000 kms of roads between Bulgaria and the Middle East by 1998, which he said would help the country get in line with EU standards. -- Stan Markotich

BANS ON GRAIN, OILSEED EXPORTS EXTENDED THROUGH 1996.
The Bulgarian cabinet on 28 December extended for another year the ban on the export of bread and feed grain and oil-bearing seeds and their derivatives, Demokratsiya reported the next day. The move had been controversial, even within the cabinet, with Trade Minister Kiril Tsochev (also a Deputy Prime Minister) against it because it would harm the country's chances of joining the World Trade Organization, as well as the interests of producers. The move comes on the heels of this year's "grain crisis": this year's harvest is the lowest in the last 15 years, except for 1985, and bread and grain have been scarce this fall. The cabinet also proposed that the export of meat, coal, and liquid fuels be subject to registration and that licenses be required for the export of gold and silver. -- Michael Wyzan

EU SUPPORTS ALBANIAN INFRASTRUCTURE.
The EU and the Albanian government have signed an agreement providing about 25 million ECU ($32.5 million) in aid for infrastructure development on 22 December, international agencies reported. The aid includes a program of 16 million ECU ($20.8 million) for ports and roads and an additional 9 million ECU for roads along the Adriatic Sea. Since 1991, the EU has provided $671.6 million in aid to Albania, making it the country's leading donor. -- Fabian Schmidt

SEARCH FOR TURKISH PILOT OFF MITILINI.
Greek and Turkish military aircraft are searching for the pilot of a Turkish F-4 jet fighter which crashed near the Greek island of Mitilini, Western media reported on 28 December. The plane, one of two which Athens claims violated Greek airspace, crashed due to mechanical failure after being intercepted by Greek warplanes. Greek and Turkish warplanes regularly engage in mock dogfights in the Aegean where the two countries dispute the extent of their respective territorial waters. In February a Turkish F-16 was lost in a similar incident. -- Lowell Bezanis

[As of 1200 CET]


Compiled by Victor Gomez and Pete Baumgartner




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