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Newsline - September 4, 1996


YELTSIN SUPPORT FOR LEBED PLAN UNCLEAR.
President Boris Yeltsin has not publicly announced his opinion on Security Council Secretary Aleksandr Lebed's peace plan for Chechnya while his subordinates are giving conflicting accounts of his views. During his trip to the North Caucasus republic of Kabardino-Balkariya on 3 September, Prime Minister Viktor Chernomyrdin announced that Yeltsin supported the plan, ITAR-TASS reported. Chernomyrdin had said earlier that he supported the agreement as well. However, Lebed himself said that Yeltsin had been silent about the idea of deferring the question of Chechen independence for five years but that "silence meant approval," Izvestiya reported on 4 September. Lebed said that he is in constant touch with the president through notes or by telephone but added that "open support from the president would not hurt." -- Robert Orttung

LEBED: 80,000 DEAD IN CHECHNYA, CURRENT PLAN IS SIMILAR TO BREST-LITOVSK.
Security Council Secretary Lebed on 3 September said that 80,000 people, plus or minus 10,000, had been killed in Chechnya, NTV reported. He compared his deal with Chechen Chief of Staff Aslan Maskhadov to the Brest-Litovsk peace treaty in which the Bolsheviks gave up considerable land to win peace from the Central Powers in 1918. Despite this comparison, however, Lebed said the integrity of Russia should be maintained, noting that his plan leaves five years to work out the "nuances" of the issue. Lebed avoided discussing the issue of how to disarm the separatist fighters and reconstruct the republic. He rejected speculation in the Russian media that the plan is part of his bid for the presidency, although he claimed that he and Chernomyrdin would play the main role in the peace process. -- Robert Orttung

CHERNOMYRDIN ADMITS MISTAKES IN CHECHNYA.
Speaking in Kabardino-Balkariya, Prime Minister Chernomyrdin admitted for the first time that Moscow had made mistakes in Chechnya, NTV reported on 3 September. He said that "we must speak of our shame for everything that has happened." Chernomyrdin supported the idea of a referendum, saying that the Chechen people could decide themselves whether they should be independent in five years. He noted that the Chechen separatists are not the only opponents of the government's peace plan but refused to name anyone. -- Robert Orttung

ZYUGANOV CRITICIZES LEBED ACCORDS . . .
Communist Party leader Gennadii Zyuganov has denounced the Lebed-Maskhadov peace agreement as unconstitutional and a threat to Russia's territorial integrity, Russian media reported on 3 September. At the same time, Zyuganov inexplicably said the Communists "welcomed" a peaceful resolution of the crisis. He also called on the parliament's upper house, the Federation Council, to hold a special debate on Lebed's authority on the Chechen issue, Radio Rossii reported. Zyuganov is not a member of the largely pro-government Federation Council, but his party and left-wing allies have a working majority in the lower house, the State Duma. The Duma seems unlikely to convene a special session to discuss Chechnya, and a Duma spokesman told ITAR-TASS that the deputies are not drafting an official statement on the Lebed-Maskhadov agreement. -- Laura Belin

. . . AS DO "PATRIOTS."
Also on 3 September, Duma Deputy Speaker Sergei Baburin, leader of the nationalist Russian Public Union, hosted a press conference of politicians on
the "patriotic" wing of the Russian spectrum to denounce the Lebed-Maskhadov agreement, Kommersant-Daily reported the next day. Baburin warned that the document threatened the Russian constitution by making its provisions "arguable." Chechen rebels, he added, would soon force Chechnya's total separation from Russia, increase their numbers and launch an attack deep into Russian territory. In addition, Baburin claimed that the shattered Chechen economy would become a "black hole" through which criminals will pump oil, narcotics, and ill-gotten capital. Doku Zavgaev, the pro-Moscow Chechen head of state, attended the press conference and said he agreed with Baburin's every word. -- Laura Belin

MORE REACTION TO U.S. MISSILE ATTACKS AGAINST IRAQ.
An official Russian government statement called the U.S. cruise missile attacks against Iraq an "inappropriate and unacceptable reaction" to recent events and called for halting military operations that threaten Iraq's "sovereignty and territorial integrity," Russian and Western agencies reported on 3 September. Speaking from Switzerland, Foreign Minister Yevgenii Primakov linked the strikes to U.S. President Bill Clinton's re-election campaign, an interpretation shared by Duma Foreign Affairs Committee Chairman Vladimir Lukin, along with Izvestiya and the official newspaper Rossiiskaya gazeta in their 4 September editions. U.S. State Department spokesman Nicholas Burns said the Russians were "not surprised" by the strikes, and the U.S. embassy in Moscow said Washington is carrying out "intensive consultations" with the Russian government on the matter. -- Laura Belin

CASE OF MURDERED JUDGE HIGHLIGHTS UNDERFUNDING OF JUDICIARY.
A Moscow street vendor stabbed to death a judge at the Ostankino municipal court in Moscow after he was fined just 37,950 rubles ($7) for trading illegally, Kommersant-Daily reported on 31 August. On 30 August, the day after Judge Olga Lavrenteva had ordered that vendor Valerii Ivankov's goods be confiscated, the latter returned to the court building and stabbed Lavrenteva repeatedly. Court personnel, many of whom are women, are routinely threatened, and security is minimal owing to a lack of funding. They were dealt another blow by President Yeltsin's 18 August austerity decree, which among other provisions suspends implementation of a law on social protection for judges and court officials in an attempt to reduce the budget deficit. -- Penny Morvant

PAYMENTS CRISIS PROVOKES MORE LABOR DISPUTES, POWER CUTS.
About 70 workers at the troubled Primorskii power plant at Luchegorsk began a new hunger strike on 3 September to protest the Russian energy company's failure to adhere to the promised timetable for repaying wage arrears, ITAR-TASS reported on 4 September. Following an 11-day hunger strike a month ago, workers were promised that arrears for May and June would be paid by 30 August. Also in Primore, continuing shortages of fuel oil because of the power plants' inability to pay suppliers are leading to new electricity cuts to consumers. ITAR-TASS reported that beginning on 2 September some areas were suffering cuts of up to 16 hours a day. Meanwhile, 500 building workers at the Severomuisk tunnel on the Trans-Siberian railway are continuing a 17-day strike to protest arrears totaling 14 billion rubles ($2.6 million). Only 695 meters of the 15 km tunnel remains to be built. -- Penny Morvant

BANK CRISIS "IMPOSSIBLE."
Petr Aven, president of Alfa Bank, told a seminar at the Carnegie Endowment on 3 September that a bank crisis of the sort experienced in August 1995 "cannot now happen." Banks are no longer heavily dependent on inter-bank overnight loans. Mikhail Dmitriev, from the Carnegie Endowment, said bad loans to clients are not likely to trigger a crisis either, since they amount to only 1% of total assets. This is partly because bank lending to clients is still very low. Dmitriev stressed that bank balance sheets are extremely unreliable and do not reflect their real asset structure. The main reason why a sudden crash of the banking system is unlikely is that the banking system per se is weakly developed. Most banks still depend on state business--and the state has made it clear that it will bail out the larger banks. -- Peter Rutland in Moscow

TOP 200 RUSSIAN COMPANIES.
Ekspert on 2 September carried a rating of the top 200 companies in Russia. The Unified Energy System topped the list, with sales of $36.5 billion in 1995 and pre-tax profits of $4.3 billion. Gazprom was next, with $27 billion sales and $3.2 billion profits. If these companies were included on the list of top U.S. firms, they would rank 15th and 25th respectively. The remaining companies in the top 20 were all raw material producers (oil, metal, and diamonds), except for two car producers--AvtoVAZ and GAZ. The top 20 firms alone account for 56% of Russia's industrial production and employ 3.4 million of its 17 million industrial workers. -- Peter Rutland in Moscow

NEW CHAIRMAN OF VNESHEKONOMBANK APPOINTED.
The Observation Council of Vneshekonombank has dismissed the bank's chairman, Yurii Poletaev, and appointed Russia's executive director of the IMF, Dmitrii Tulin, to replace him, Kommersant-Daily and Finansovye izvestiya reported on 3 September. Observation Council head Sergei Dubinin, who is also the chairman of the Central Bank, said Poletaev was dismissed because "new tasks require new people." Tulin, with a background in security and currency operations, is well suited to oversee the bank's new policy priorities, such as the development of depository operations and trade in precious metals. However, Poletaev's dismissal may be related to the scandal surrounding the theft of Finance Ministry currency bonds deposited in Vneshekonombank. -- Natalia Gurushina



ELECTIONS SCHEDULED IN NAGORNO-KARABAKH . . .
At a session marking the fifth anniversary of the Republic of Nagorno Karabakh's (RNK) unilateral declaration of independence from Azerbaijan, the RNK parliament voted to hold a presidential election on 24 November 1996, according to a 30 August Armenian Radio report monitored by the BBC. The current RNK president, Robert Kocharyan, was elected in 1994; his term expires in December 1996. Under the terms of the Law on Presidential Elections passed by the RNK parliament in May 1996, the new president will be elected for five years; presidential candidates must collect a minimum of 1,500 signatures in their support from residents of at least four of the six raions of the RNK. -- Liz Fuller

. . . AND ABKHAZIA.
The president of Abkhazia, Vladislav Ardzinba, has scheduled a parliamentary election for 23 November 1996, according to a 31 August Republic of Abkhazia Radio report monitored by the BBC. The existing Abkhaz parliament, elected in early 1992, split during the civil war of 1992-1993; the Georgian deputies fled to Tbilisi where they set up an exile parliament. -- Liz Fuller

PEACEFUL SOLUTION FOR KARABAKH SOON?
Azerbaijani presidential adviser Vafa Guluzade believes that a peaceful solution can be found to the Nagorno-Karabakh problem following a meeting in Frankfurt with his Armenian counterpart, Jirair Liparitian, Turan reported on 30 August. Guluzade said that Armenian authorities are eager to resolve the conflict due to economic difficulties in their country and because they have realized that Nagorno-Karabakh cannot be annexed and that no country will recognize the enclave's independence. In Ankara, Liparitian said that a new draft agreement proposed by the Armenian side should satisfy Azerbaijan. -- Elin Suleymanov

ARMENIAN PRESIDENT UNVEILS PRE-ELECTION PLATFORM.
Levon Ter-Petrossyan has unveiled his election platform for Armenia's 22 September presidential vote, Noyan Tapan reported on 3 September. The president's priorities include the further development of democratic institutions, a continuation of the fight against crime and corruption in government and law enforcement agencies, and a strengthening of the army and intelligence services. He also pledged to continue free-market reforms while improving living conditions through the permanent growth of wages and the creation of a system of social security. He said a balanced foreign policy will be directed at increasing cooperation with Russia, Georgia, and Iran and at looking for ways to settle problems with Azerbaijan and Turkey. Ter-Petrossyan said he will seek a compromise solution to the Nagorno-Karabakh conflict and would like to improve relations with Armenia's diaspora. -- Elin Suleymanov

GEORGIA REITERATES CLAIM TO PART OF BLACK SEA FLEET.
Georgian Foreign Minister Irakli Menagharishvili on 3 September said that during his recent visit to Kyiv he presented the Ukrainian leadership with an official Georgian claim on part of the Black Sea Fleet, and that a similar claim had been passed to the Russian government by Georgia's ambassador in Moscow, Vazha Lordkipanidze, ITAR-TASS reported. In 1992, Georgia was allocated the naval port infrastructure at Poti and Ochamchire (in Abkhazia) plus a number of coastal patrol boats and minesweepers; it is now demanding an unspecified number of additional vessels to protect its naval borders. At a press conference in Tbilisi on 21 August, Ukraine's ambassador to Georgia, Anatolii Kosyanenko, said he saw no obstacles to Ukraine and Georgia reaching agreement on this issue, BGI reported. -- Liz Fuller

EU PLEDGES TO HELP CENTRAL ASIAN STATES.
The EU has pledged to help Kyrgyzstan, Kazakstan, and Uzbekistan secure membership in the World Trade Organization and to provide these countries with additional financial and expert assistance, according to Russian and Kazakstani media. According to a 1 September ITAR-TASS report monitored by the BBC, the EU will provide Kyrgyzstan with an estimated $30 million up to the year 2000 under the TACIS technical aid program, $15 million in humanitarian aid, and $600,000 to buy medical supplies. Details on the EU aid pledged to Kazakstan and Uzbekistan were not publicized. Kyrgyz and Kazakstani officials discussed the aid with visiting EU external affairs commissioner, Hans van den Broek, earlier this week. -- Lowell Bezanis



GERMAN CHANCELLOR SIGNS AGREEMENTS WITH UKRAINE.
Visiting German Chancellor Helmut Kohl signed seven trade agreements with Ukrainian President Leonid Kuchma on 3 September, Ukrainian radio and AFP reported. They included a deal with a coal-mining enterprise near Kharkiv and an agreement to modernize the Odesa airport. Germany is Ukraine's largest trading partner in the EU; Ukrainian-German trade totaled $1.6 billion in 1995. -- Ustina Markus

UKRAINIAN PARLIAMENT MEETS.
Parliament met in the first day of its sixth session on 3 September, Ukrainian radio reported. The resignations of three deputies in government posts were accepted. These included First Deputy Prime Minister Vasyl Durdynets; Anatolii Zolotarov, head of the state cooperative for industry and building; and Serhii Uspuch, head of the state administration in Transcarpathia. Under the new constitution, deputies cannot simultaneously hold other government appointments. Parliament also approved the national symbols as set out in the constitution and called for a nationwide competition on the exact design of the state symbol--a trident--and for words for the national hymn. Parliament is also considering who should replace Deputy Speaker Oleh Domin, who resigned after being appointed head of the Kharkiv oblast administration. -- Ustina Markus

SPLIT AMONG BELARUSIAN COMMUNISTS.
Several leader of the Party of Communists of Belarus issued a protest over party First Secretary Syarhei Kalyakin's signing of a resolution by the "round-table" opposition to President Alyaksandr Lukashenka, Belapan reported on 2 September. Viktar Chykin, secretary of the party's Central Committee, called for avoiding splits in the party. Chykin said Kalyakin's alliance with right-wing forces came as a surprise to ordinary communists. He said the "round-table" forum was unconstructive, and called upon the Communists to hold a special congress to work out a concerted policy over the referendum. Chykin's exact position is unclear, since he said he did not oppose Kalyakin's position in general, but felt the Communist leader should have first discussed the matter with party leadership. -- Ustina Markus

INDEPENDENT RADIO STATION CLOSED IN BELARUS.
Station 101.2 was shut down because its operations were "interfering in government communications," Radio Rossii and PAP reported on 1 September. The station broadcast primarily music and some news. The head of the station, Zhanna Litvina, said the move was just another in a series aimed at curtailing media freedom. She also said it was part of the state's anti-Belarusian policy, since it was the only independent channel broadcasting in Belarusian and fostering national "rebirth." The station plans to appeal the decision. -- Ustina Markus

LATVIAN ARMY CHIEF RESTORED TO OFFICE.
President Guntis Ulmanis and Prime Minister Andris Skele on 3 September officially restored Home Guard Col. Juris Dalbins as commander in chief of the armed forces, BNS reported. Dalbins had been suspended in late July after numerous fatalities in the armed forces, in part caused by inadequate military discipline. Ulmanis said an investigating committee had concluded that the direct commanders of companies and platoons, not Dalbins, were to blame. -- Saulius Girnius

RESCUE OF LITHUANIA'S VAKARU BANK BLOCKED. T
he Lithuanian Cabinet voted on 30 August not to allow the Klaipeda State Harbor to invest 20 million litai ($5 million) in frozen funds into the Vakaru Bank in Klaipeda, BNS reported. Finance Minister Algimantas Krizinauskas said the Bank of Lithuania will soon revoke the bank's license and initiate bankruptcy proceedings against it, as promised in the memorandum signed with the International Monetary Fund on 4 July. He said the government will experience losses of 70-100 million litai with the bankruptcy, but even more if it attempted to save the bank. Krizinauskas said if the Vakaru Bank's license is not revoked by 19 September, Lithuania will lose an $80 million loan from the World Bank. But he said even after the filing of bankruptcy proceedings, the bank could save itself by finding outside investors without any direct or indirect government aid. -- Saulius Girnius

BATTLE OVER POLISH PUBLIC TV CONTINUES.
Polish Public TV's (TVP) most viewed Channel 1 has no director after the TVP board fired Tomasz Siemoniak on 30 August (see OMRI Daily Digest, 30 August 1996). Siemoniak had replaced Maciej Pawlicki on 1 April and made some concessions to the left-dominated TVP board, cancelling programs the ruling coalition considered unfriendly. But in August, Siemoniak refused to satisfy the demands of the board. The board then pressed Siemoniak to postpone the airing of a political program called "Echoes of the Day" and to remove its creators from other political programs. Several TV journalists resigned in protest. The opposition Freedom Union party accused the ruling coalition of trying to grab control of public TV, but Prime Minister Wlodzimierz Cimoszewicz denied on 3 September any attempts to influence the TVP. -- Jakub Karpinski

SLOVAK POLITICAL UPDATE.
The government on 3 September fired four state secretaries, Slovak media reported. The dismissal of Pavol Hrma and Pavol Kacic, state secretaries of the economy and interior ministries, respectively, followed last week's sacking of the heads of those ministries. Also fired were Environment Ministry State Secretary Jan Prislupsky and Culture Ministry State Secretary Olga Salagova, a former actress who supported the Slovak National Theater staff in their conflict with Culture Minister Ivan Hudec. Government spokeswoman Ludmila Bulakova told Slovak Radio that the changes are the result of coalition talks, and the cabinet approved the proposals without comment. The government also dismissed the heads of two ministerial offices. In other news, SND director Dusan Jamrich on 3 September warned that the theater is experiencing "the darkest period in its history, including the Fascist era." He denied Culture Ministry charges that he was involved in financial fraud, CTK reported. -- Sharon Fisher

HUNGARY'S OPPOSITION ATTACKS DRAFT BASIC TREATY WITH ROMANIA . . .
During a special session of the parliament on 3 September, opposition parties condemned the draft Hungarian- Romanian basic treaty, Hungarian dailies reported the next day. They accused governing parties of "supporting a draft that sets limits to minority rights, of neglecting the interests of the Hungarian community in Romania, and of supporting Iliescu's election campaign." Opposition leaders said the "approval of the basic treaty could win a pat on the back from Europe but never its respect." The session was convened on the initiative of the opposition in an effort to ensure that the cabinet will not sign the treaty without preliminary authorization from parliament. The initiative, however, was rejected in a parliamentary vote by governing parties, who hold 72% of all seats. -- Zsofia Szilagyi

. . . BUT GOVERNMENT REMAINS ADAMANT.
In reaction to the opposition's heated criticism, socialist Prime Minister Gyula Horn said, "I have heard nothing that would prevent me from signing the treaty." Foreign Minister Laszlo Kovacs argued that the international community considers the basic treaty the most important indication of an intention to improve bilateral relations with Romania. He said the treaty will help Hungary's Euro-Atlantic integration efforts and will contribute to stability in the region. He said the draft is the "maximum that can be attained under present conditions." Matyas Eorsi, chairman of Parliament's foreign affairs committee, warned that a failure to approve the treaty could lead to an increase in anti-Hungarian manifestations in Romania. He added that the chances of signing a document that is acceptable to both Bucharest and ethnic Hungarian organizations in Romania are close to zero. -- Zsofia Szilagyi



STATES OF FORMER YUGOSLAVIA MEET FOR SUCCESSION TALKS.
Representatives from Bosnia, Croatia, Macedonia, and Slovenia met in Ljubljana on 3 September to discuss the succession issue but failed to make any headway, according to Reuters. A plan submitted by Sir Arthur Watts, legal expert to the international community's high representative Carl Bildt, was discussed at length but ultimately panned. While details of the Watts proposal remain sketchy, international media reports suggest its main weakness insofar as the representatives were concerned was its treatment of former Yugoslav assets held abroad. Shedding some light on the Slovenian position, Miran Majek, head of Slovenia's succession commission, said, "We cannot agree that the new Yugoslavia retains embassies that used to belong to the former Yugoslavia." -- Stan Markotich

BOSNIAN REFUGEE VOTING ENDS.
Voting by the 641,010 Bosnian citizens living abroad has finished, international media reported on 4 September. Voters live in 55 countries or territories ranging from Serbia-Montenegro, Croatia, and Germany--which have the largest numbers--to Albania and New Caledonia with but a handful each. The turnout was affected by technical problems--including late delivery of ballot papers or issuing of the wrong papers--as well as by various political problems and general confusion about candidates and parties. Voting lasted from 28 August to 3 September in Serbia-Montenegro, where the turnout reached 56%. Many Muslim voters stayed away from the polls in Germany, apparently confused as to whether their leaders back home had called for a boycott or not. Things went relatively smoothly in Croatia, where over two-thirds of those eligible voted. Balloting in Bosnia-Herzegovina itself is slated for 14 September. -- Patrick Moore

NEW SLANDER CHARGES AGAINST INDEPENDENT MEDIA IN CROATIA.
The ruling Croatian Democratic Community (HDZ) on 3 September filed slander charges against two independent newspapers, the daily Novi List and the weekly Nacional, international agencies reported. Senior editors of the two papers were accused for publishing "lies and delusions," muddying the leaders of the HDZ and its members. The charges were made under a new law providing for prosecution of journalists who offend top state officials, and only a few weeks before the country's first freedom of speech-related trial against a senior editor of the satirical weekly Feral Tribune. Novi List is Croatia's only independent daily, with a circulation of 40,000, and Nacional is a weekly magazine often critical of top officials. A free media was one of the conditions for Croatia's accession to the Council of Europe. -- Daria Sito Sucic

GERMANY DETERMINED TO RETURN BOSNIAN REFUGEES.
German Interior Minister Manfred Kanther said on 1 September the repatriation of about 320,000 Bosnian refugees will go ahead as planned on 1 October, AFP reported. Kanther said forcible expulsions may have to be used because not all the refugees would return voluntarily. A meeting of Germany's state authorities, who opposed the federal authorities on the issue of refugee repatriation, is scheduled for mid-September, when Kanther will be seeking formal approval of the repatriation scheme. But the Bosnian Ministry for Refugees said the 1 October deadline is too soon for refugee repatriation, and insisted on their voluntary return, Oslobodjenje reported on 4 September. Bosnian refugees in Germany hope to extend their refugees status there due to the postponement of Bosnia's municipal elections, originally scheduled in September, until spring. -- Daria Sito Sucic

SERBIAN ARMS PLANT WORKERS CONTINUE JOB ACTION.
Hunger strikers at the Zastava plant are being encouraged to give up that protest, Nasa Borba reported on 4 September. On 2 September Beta reported that opposition leader Vuk Draskovic's Serbian Renewal Movement had issued an appeal to the hunger strikers, urging them "not to take [this protest] to the end" since the government "wants nothing more than for [you]...to die of hunger." In other news, on 3 September Tanjug reported that visiting Polish Foreign Minister Dariusz Rosati met with Milosevic, and that both leaders called for improved relations between rump Yugoslavia and Poland in various fields, including agriculture, economics, and tourism. -- Stan Markotich

CONFUSION SETTLED OVER KOSOVO AGREEMENT?
Translation errors between the Serbo-Croatian and Albanian version continued to cause confusion over the education agreement that Kosovar shadow state President Ibrahim Rugova and Serbian President Slobodan Milosevic separately signed in Pristina and Belgrade on 1 September. The Albanian version explicitly mentions universities, while the Serbo-Croatian version does not. But the Sant'Egidio Community, a Rome-based Roman Catholic peace group that mediated the deal, said it had settled the dispute in talks on 2 September. Sant'Egidio's founder Andrea Riccardi said his group would continue to support the dialogue between the Serbian government and the LDK, Reuters reported. "There is no agenda, but I sense the next steps will be in the areas of civil life, culture, economy and health," he added. -- Fabian Schmidt

MACEDONIA, BOSNIA TO ESTABLISH DIPLOMATIC TIES.
Visiting Bosnian Prime Minister Hasan Muratovic and his Macedonian counterpart, Branko Crvenkovski, on 30 August agreed to establish diplomatic relations after the 14 September Bosnian elections, international media reported. Following the establishment of diplomatic ties, the two countries will sign agreements on economic and trade cooperation, on protection of investment, and against double taxation. -- Stefan Krause

ITALY BACKS SLOVENIA ON NATO, EU.
Italian Foreign Minister Lamberto Dini said on 3 September that "Italy will give full support to Slovenia's intentions" to join NATO and the European Union, Reuters reported. Those remarks came after Slovenian Foreign Minister Davorin Kracun met with Dini in Rome that same day. For his part, Kracun said both parties had signed two agreements aimed at allowing citizens of each country to travel to the other without passports or visa requirements. Slovenian-Italian relations have been steadily improving since May 1996, after Ljubljana dropped its objections to foreigners owning property, a move widely regarded as enabling Italian citizens whose property was nationalized after they left Slovenia after World War II to buy back real estate. -- Stan Markotich

ROMANIAN CABINET RESHUFFLE.
Following the ouster of the Party of Romanian National Unity (PUNR) from the governmental coalition, three new ministers, all members of the Party of Social Democracy in Romania (PDSR), were sworn in by President Ion Iliescu on 3 September, Radio Bucharest reported. They are Ion Predescu, former chairman of the Senate's judicial commission, who takes over the justice portfolio; Alexandru Lapusan, at agriculture; and Virgil Popescu, who is now communications minister. Lapusan and Popescu were formerly deputy ministers. The government also dismissed five PUNR county prefects and several deputy prefects. In a press release, the PUNR attacked the PDSR for its decision to break up the coalition, calling it "immoral" and aimed at achieving sole control of the parliamentary and presidential elections scheduled for 3 November. The PUNR also accused the PDSR of jeopardizing the country's national interests by deciding to sign the basic treaty with Hungary. -- Michael Shafir

ROMANIAN MILITARY NEWS.
Defense Minister Gheorghe Tinca on 2 September signed an agreement in London with the Bell Textron Company providing for the construction of the Cobra attack helicopter under license, Radio Bucharest reported. In other news, Romanian and international media on 31 August reported the beginning of a new NATO 10-day military exercise in the Black Sea. The exercise, conducted near the Romanian port of Constanta within the framework of the Partnership for Peace, is focusing on humanitarian and peacekeeping operations. Apart from Romanian and U.S. forces, participants include Greece, Italy, and Ukraine. -- Michael Shafir

NEW MOLDOVAN PRESIDENTIAL CANDIDATES.
Moldovan Communist Party Chairman Vladimir Voronin has announced his candidacy in the presidential elections scheduled for 17 November, Infotag reported on 30 August. Voronin, who was Soviet Moldova's last interior minister, told Reuters he expected the support of many Moldovans disillusioned by the painful market reforms. In related news, Ilie Ilascu, who has been sentenced to death and has been in prison since 1992 for alleged terrorist acts in the breakaway Dniester Republic, also announced his intention to run. -- Michael Shafir

BULGARIAN SOCIALISTS PICK NEW PRESIDENTIAL CANDIDATE.
The Bulgarian Socialist Party (BSP) on 3 September nominated Culture Minister Ivan Marazov as presidential candidate and Deputy Foreign Minister Irina Bokova as vice-presidential candidate, Duma reported. Marazov had been the running mate of Foreign Minister Georgi Pirinski, who was rejected by the Central Electoral Commission and the Supreme Court. According to Kontinent, BSP leader and Prime Minister Zhan Videnov wanted Justice Minister Mladen Chervenyakov to run for president, while former party leader Aleksandar Lilov preferred Nikolay Kamov, chairman of the parliamentary foreign affairs committee. Standart reported that Videnov objected to Marazov, saying he is unsuitable as commander in chief of the armed forces and has health problems. The BSP again criticized the ruling but said it accepts it because it respects the democratic institutions. Meanwhile, Pirinski said he will file a complaint with the European Court of Justice for Human Rights. -- Stefan Krause

BULGARIAN ROUNDUP.
A Tupolev 154 of the Bulgarian carrier Hemus Air was hijacked on 3 September by a Palestinian man, Reuters reported. He hijacked the plane on a flight between Beirut and Varna, released the 150 passengers in Varna, and was then flown to Oslo, where he surrendered to the police. A Norwegian police official said the man asked for political asylum. In other news, Michael Kapustin, a Russian-born Canadian businessman and former owner of the "Life Choice" investment fund, was extradited from Germany, AFP reported. Kapustin is accused of defrauding investors of $18 million in "Life Choice," an obvious pyramid scheme. Kapustin claimed the fund was developing a cure for AIDS and promised 151% interest in 1993 and 227% in 1994. "Life Choice" paid the interest in 1993, attracting 10,000 new investors in 1994, put stopped paying in 1995 after transferring its funds overseas. -- Stefan Krause

ALBANIAN OPPOSITION AGREES TO PARTICIPATE IN ROUND TABLE.
Fourteen Albanian parties, including the opposition Socialists, Social Democrats and the Center Pole coalition, agreed to participate in talks with President Sali Berisha on 4 September, Rilindja Demokratike reported on 4 September. Zeri i Popullit said the talks would focus on a new law on local elections and added that the opposition parties in a previous debate had agreed to the meeting despite the fear that it "may be turned into a propaganda spectacle" by the government. -- Fabian Schmidt

[As of 1200 CET]

Compiled by Victor Gomez and Janet Hofmann









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