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Newsline - February 21, 1997


ALBRIGHT OFFERS NEW PROPOSAL IN MOSCOW ...
U.S. Secretary of State Madeleine Albright arrived in Moscow on 20 February for talks with Russian Foreign Minister Yevgenii Primakov and Prime Minister Viktor Chernomyrdin, international agencies reported. Albright presented Primakov with a new proposal to freeze conventional forces at current levels in Belarus, the Czech Republic, Hungary, Poland, Slovakia, western Ukraine, and the Russian enclave of Kaliningrad, AFP reported. The same day, the proposal was released at the ongoing CFE talks in Vienna. Albright described her talks with Primakov as "serious and constructive," Reuters reported, while Primakov said Russia was doing everything it could to "minimize the negative consequences" of NATO expansion. On 21 February, Albright met with President Boris Yeltsin. -- Peter Rutland

... REACTIONS UNCERTAIN.
The revision of the 1990 CFE treaty which Albright proposed could qualify as the sort of "binding treaty" that Russia has been insisting on, enabling Moscow to acquiesce in NATO expansion while saving face. On the other hand, Moscow may still insist on a binding commitment not to deploy nuclear weapons in the zone--which NATO is unlikely to concede. Also, the new proposal does not address the question of the construction of new bases or the deployment of new NATO forces in Eastern Europe (within the force ceilings), issues of concern to Moscow. Russia continues to look for differences between the NATO allies. Italian Foreign Minister Lamberto Dini was visiting Moscow on 20 February, and he said that "From Italy's point of view, the eventual NATO expansion can only take place with the consensus of Russia and not against its will." Dini, like German Foreign Minister Klaus Kinkel earlier this week, was able to talk to President Yeltsin by phone but not to meet him. -- Peter Rutland

SENIOR FSB OFFICER FIRED.
President Yeltsin has issued a surprise decree dismissing Federal Security Service Deputy Director Col.-Gen. Anatolii Trofimov, Radio Rossii reported on 20 February. Trofimov, who was also head of the Moscow and Moscow Oblast division of the FSB, was reportedly fired for "inadequate performance" and "gross violations" revealed by a recent Auditing Chamber investigation. ORT, however, quoted the head of the Auditing Chamber as expressing surprise that its audit could have provided grounds for Trofimov's dismissal. NTV noted that the firing followed a recent scandal involving drug dealing by FSB officers in Moscow (see OMRI Daily Digest, 20 February 1996). It also speculated that Trofimov might have incurred the wrath of Moscow Mayor Yurii Luzhkov over a corruption expose in Novaya gazeta based on FSB sources. Trofimov was known for his hard line on dissidents and human rights activists. -- Penny Morvant

BAGLAI ELECTED CHAIRMAN OF CONSTITUTIONAL COURT.
The Constitutional Court elected Marat Baglai, who turns 66 on 13 March, as its new chairman on 20 February, Rossiiskie vesti reported. The former Chairman Vladimir Tumanov retired when he turned 70, the age limit for the position. Twelve of the court's current 18 members supported Baglai. Yeltsin has proposed that Mikhail Fedotov fill the court position vacated by Tumanov and he is awaiting Federation Council approval. Baglai joined the court in February 1995, after serving as the rector of the Academy of Labor and Social Relations for 18 years. Baglai has made it clear that he does not support any efforts to radically rewrite the constitution in order to reduce the president's powers. NTV described him as moderate who does not like to get involved in politics. Kommersant-Daily on 21 February noted that he is a close associate of former Chairman Tumanov, who worked assiduously to keep the court from conflicting with the president. Yeltsin quickly congratulated Baglai after his election. -- Robert Orttung

RUSSIAN ORTHODOX CHURCH COUNCIL EXCOMMUNICATES YAKUNIN, FILARET.
The Russian Orthodox Church's High Clerical Council resolved on 20 February to excommunicate former priest and Duma deputy Gleb Yakunin and former Metropolitan Filaret (Mikhail Denisenko), NTV reported. Yakunin was defrocked in 1993 for ignoring a ban on priests running for election to the Russian parliament. Yakunin believes the move was revenge for his charge that senior Orthodox priests cooperated with the KGB during the Soviet era. Filaret, defrocked in 1992, is now patriarch of the independent Ukrainian Orthodox Church-Kiev Patriarchate, the second largest church in Ukraine. The Council, which opened in Moscow on 18 February, also heard a recommendation from a commission considering the question of canonizing Russia's last tsar, Nicholas II. Metropolitan Yuvenalii said the commission had not found sufficient basis for his canonization, and the Council referred the issue to a wider church assembly for further consideration. -- Penny Morvant

DUMA CONSIDERS BILLS ON PORNOGRAPHY, COSSACKS.
The Duma on 20 February approved in the first reading a bill limiting the circulation of pornographic materials, NTV and ORT reported. The bill provides for sex-related products to be sold only in places licensed by the authorities and restricts the times when pornographic films can be shown on television (see OMRI Daily Digest, 11 February 1997). The vote followed a heated debate, with some deputies opposing the draft on the grounds that it would give legal status to pornography and contribute to the moral degradation of society. The same day, the deputies also passed in the first reading a bill on the Cossacks. The law lays out the procedure for registering Cossack communities and calling up Cossacks for military service. It describes Cossacks as "a community of people...with their own traditions, areas of residence, culture, economic system, and a special attitude toward army service and their relationship with the state," ITAR-TASS reported. -- Penny Morvant

NATIONWIDE RADIO BROADCASTING COMING TO AN END?
The managers of several nationwide radio stations--including Radio Rossii, Mayak, Golos Rossii--said on 20 February that state-owned radio broadcasting is gradually dying, ITAR-TASS reported. The radio stations have been forced to significantly reduce their air time after severe cuts in federal budget subsidies. Mayak, currently a round-the-clock broadcaster, must reduce its broadcast time to 14 hours a day. Mayak news director Vladimir Povoliayev said commercial radio cannot fill the gap because it is not profitable to broadcast to small towns and villages. Mayak usually spends 80% of its state subsidies just to cover its nationwide signal transmission. The station managers also expressed their support for the communication workers who are planning to go on strike on 27 March to protest wage arrears. --
Nikolai
Iakoubovski

LEBED'S BROTHER AUDITS CITY GOVERNMENT WITH MACHINE GUNS.
Khakasiya Governor Aleksei Lebed on 20 February ordered machine gun-toting officers from the local Interior Ministry branch to confiscate financial documents from the city hall of Sayanogorsk, the republic's second largest city, ITAR-TASS reported. Sayanogorsk Mayor Sergei Bondarenko denounced the seizure as a gross violation of the law on local government since he and his deputies were willing to cooperate with the audit. While the raid was under way, Lebed ordered the closure of the local TV and radio station, according to station Director Venyamin Striga. Meanwhile, a group of investors in the recently bankrupted Sayany Bank ran into police obstacles when they tried to formally request the legislature to explain why some of the bank's former directors are now under consideration for positions in Lebed's cabinet. -- Robert Orttung

KALASHNIKOV ANNIVERSARY.
An exhibition opened in Moscow on 20 February marking the 50th anniversary of the introduction of the Kalashnikov light machine gun, Reuters reported. The 77-year old inventor of the AK-47, former Sgt. Mikhail Kalashnikov, attended the opening. More than 70 million Kalashnikovs have been produced in some 100 different versions and are currently used by the armies of 55 countries. The AK-47 is renowned for its reliability and ease of use. It is available on the black market from Chechnya to Angola for as little as $150. Russia is now producing a version with 5.56 mm NATO-compatible ammunition. -- Peter Rutland

KURDISH ACTIVITIES IN MOSCOW.
The self-styled Kurdish Parliament in Exile has organized two conferences in Moscow, Milliyet reported on 21 February. Turkey, which alleges that the parliament was created by the separatist Kurdistan Workers' Party (PKK), has repeatedly attempted to prevent such events form taking place. The latest gathering on 20 February was hosted by the Duma Geopolitical Committee and reputedly attended by Kurdish deputies from Russia, Georgia, Ukraine, Belarus, Bulgaria, Greece, Serbia, and Cyprus. The paper also reported that the PKK plans to start up a radio station in Moscow. -- Lowell Bezanis

GOVERNMENT APPROVES NEW TAX CODE.
The government has approved the new drafts of the second, third, and fourth parts of the new tax code, ITAR-TASS and Kommersant-Daily reported on 20-21 February. The code, which will now be submitted to the Duma, would reduce the number of taxes from some 200 to 32; cut the profit tax rate by 2% and cancel the sales tax; switche the tax burden from industry to individuals; increase the taxation of commercial banks; and eliminate all tax privileges. The total loss of the consolidated budget's revenue due to various tax privileges is estimated at 163 trillion rubles ($29 billion at the current exchange rate). Finance Minister Aleksandr Livshits said that a drastic cut in the number of tax benefits in the new tax code can help increase budgetary revenue by 70 trillion rubles a year, ITAR-TASS reported on 18 February. -- Natalia Gurushina

FINANCE MINISTRY ON REGIONAL EUROBOND ISSUES.
The Finance Ministry has prepared a draft resolution on regional eurobond issues, Nezavisimaya gazeta reported on 20 February. The resolution stipulates that only those regions that have obtained an international credit rating and do not receive financial support from the government will be allowed to issue eurobonds; the total volume of annual external borrowing and the total debt-servicing costs of regions that issue the bonds should not exceed 30% and 15% of regional budgetary revenue, respectively; and the income from operations with regional eurobonds will be subject to a 15% tax. The demands have drawn a negative reaction from regional leaders, who say that no region will be able to float eurobonds under such conditions. -- Natalia Gurushina


RUSSIAN PARLIAMENT TO INVESTIGATE ALLEGED ILLEGAL ARMS SUPPLIES TO ARMENIA . . .
The Russian State Duma on 19 February assigned three of its standing committees to investigate Minister for Relations with the CIS Aman Tuleev's allegations that Russia has illegally supplied $50 million worth of arms to Armenia over the past year (see OMRI Daily Digest, 17 February 1997), RFE/RL and Noyan Tapan reported. The motion was submitted by Communist deputy Nikolai Bindyukov. Several deputies, including deputies from the liberal Yabloko faction and the leftist Narodovlastie group, argued that an open discussion of the issue could harm Russian-Armenian relations. Russian ultranationalist leader Vladimir Zhirinovsky said that it is in Russia's interests to offer military aid to its "strategic ally Armenia...even for free, if necessary." -- Emil Danielyan

... AMID AZERBAIJAN'S ACCUSATIONS OF CEASEFIRE VIOLATION.
Azerbaijani President Heidar Aliyev has charged that by "illegally" receiving military equipment, Armenia has violated the May 1994 Nagorno-Karabakh ceasefire agreement, RFE/RL reported. Georgian President Eduard Shevardnadze said in Baku that he does not exclude the possibility that the alleged arms supplies were delivered to Armenia from Russian military bases stationed in Georgia, Turan reported on 20 February. Shevardnadze claimed that a "group of servicemen" has been arrested in Georgia on suspicion of illegal weapons sales to Armenia. -- Emil Danielyan

LITHUANIAN PRESIDENT IN UZBEKISTAN.
Algirdas Brazauskas and his Uzbek counterpart, Islam Karimov, signed several agreements on legal aid and transportation in Tashkent on 20 February, ELTA and BNS reported. Karimov praised Lithuania as an "extremely reliable partner," adding that he supports Lithuania's bid to join NATO. He also said the two countries see eye to eye on "virtually everything." Lithuania and Uzbekistan aim to increase trade cooperation. Bilateral trade turnover doubled last year to $66 million; Uzbek firms currently owe their Lithuanian counterparts $6 million. -- Lowell Bezanis

COMMITTEE TO PROTECT JOURNALISTS CRITICIZES KYRGYZ PRESIDENT.
The Committee to Protect Journalists has expressed "grave concern about reports of increasing harassment of the independent press in Kyrgyzstan" in a letter sent to Kyrgyz President Askar Akayev, RFE/RL reported on 20 February. The letter criticized the Justice Ministry's decision to shut down the newspaper Kriminal and the legal action threatened against Ryspek Omurzakov -- a reporter who was earlier given a suspended sentence for insulting the president -- for his coverage of opposition figure Topchubek Turgunaliev's trial. -- Lowell Bezanis


UKRAINIAN PRESIDENT BLASTS RUSSIA.
In an interview published in Nezavisimaya gazeta on 20 February, Leonid Kuchma blamed Russia for the poor state of Russian-Ukrainian relations. Kuchma said he was optimistic when Yevgenii Primakov was appointed Russian foreign minister but that since then there has been no improvement in relations and "the biased, prejudiced attitude toward Ukraine has intensified." He said Russia still views Ukraine as a constituent part, or at least within the Russian sphere of influence. As a result, there has been a cooling in economic ties and the free-trade agreement has not been fully implemented. Kuchma said the Russian presidential campaign and the "political games" in Russia prevented the signing of the treaty on friendship and cooperation with Ukraine. The criticism is Kuchma's strongest public statement yet, Reuters reported. -- Ustina Markus

UKRAINE DENIES PLANS TO LEASE SEVASTOPOL TO NATO.
A group of Russian deputies sent a letter to Ukrainian President Leonid Kuchma alleging that Kyiv officials are holding secret talks on leasing Sevastopol to the U.S. Navy's 7th Fleet in exchange for early admission to NATO, Ukrainian radio reported on 20 February. A copy of the letter was sent to Interfax. Ukrainian National Security Council Secretary Volodymyr Horbulin denied the allegations and said such publications work only to hurt Russian-Ukrainian relations. The publication of the letter coincided with a visit from a U.S. congressional delegation to Sevastopol. -- Ustina Markus

UKRAINE SEEKS INVESTORS.
Ukrainian Prime Minister Pavlo Lazarenko announced a government program to attract $3.7 billion to 4.0 billion of foreign investment, UNIAN reported on 19 February. The tax burden will be reduced, and the state's share in privatized enterprises will not exceed 26% (except for strategic facilities, of which the government will retain 51% ownership). Ukraine has so far managed to attract only $1.5 billion in direct foreign investment. Meanwhile, pressure from directors has led to the government's overturning an earlier resolution that banned enterprises from writing off mutual debts, Intelnews reported on 19 February. The ban was introduced in January because writing off inter-enterprise debts had led to a decline in budget revenue. -- Oleg Varfolomeyev

UKRAINE CONDEMNS WESTERN RELUCTANCE TO FINANCE NUCLEAR REACTORS.
Environment Minister Yurii Kostenko said Ukraine may reconsider closing the Chornobyl nuclear plant if the West does not finance the building of two new reactors to replace it, UNIAN and ITAR-TASS reported on 20 February. But a panel of EBRD advisors concluded that the financing of new reactors at Rivne and Khemlnitsky could not be approved on economic grounds, AFP reported on 19 February. The environmental group Greenpeace called on the EBRD and the EC to withdraw from negotiations over completion of the partially built reactors. -- Oleg Varfolomeyev

BELARUSIAN PRESIDENT ON UNION WITH RUSSIA.
Alyaksandr Lukashenka said on 19 February that union with Russia remains a foreign policy priority, but not at the cost of sovereignty, NCA reported. Speaking at a closed joint session of parliament, he called for the implementation of the 1996 treaty on creation of a Belarusian-Russian union. Lukashenka said he will never agree to a Russian proposal that Belarus become part of the Russian Federation and be ruled by a governor-general who would also be vice-president of the merged state. Kremlin spokesman Sergei Yastrzhembskiy denied that any such proposal had been made by Russian President Boris Yeltsin or the government. -- Sergei Solodovnikov

ESTONIA, FINLAND AGREE TO VISA-FREE TRAVEL.
The heads of the Estonian Foreign Ministry Consular Department and Finnish Foreign Ministry Legal Department Sulev Roostar and Holger Rotkirch on 20 February in Tallinn initialed an agreement for visa-free travel between the two countries starting 1 May, BNS reported. The agreement will be signed by the foreign ministers on 26 March in Tallinn. Half of the 200,000 visas issued by Estonia's representations abroad come from its embassy in Helsinki. Estonia already has visa-free travel with Denmark and is expected to sign similar agreements with Sweden and Norway later this year. -- Saulius Girnius

CHANGES IN LATVIAN PARLIAMENT CAUCUSES.
The number of caucuses in the Saeima fell from nine to seven on 20 February when the For Freedom and Justice (TN) and Unity Party (LVP) caucuses ceased to exist, BNS reported. Five of the six TN members and LVP caucus head Edgars Bans joined the Democratic Party Saimnieks caucus, raising its membership from 18 to 24. Bans's departure,, which reduced the size of the caucus to one less than the required five, prompted another LVP deputy to shift to the Farmers' Union. The other members of the former caucuses have not yet decided whether to join other parties or remain as independent deputies. -- Saulius Girnius

REGISTRATION FOR LITHUANIAN LOCAL ELECTIONS.
A total of 6,432 candidates from 24 political parties have been registered for the elections on 23 March to 1,484 seats in 56 city and raion councils. The ruling Conservatives have the most candidates (1,410), followed by the Christian Democrats (979), the Democratic Labor Party (742), the Center Union (643), and the Social Democrats (613). The Center Party lodged an official complaint on 20 February to the Supreme Election Commission against the decision of its Siauliai district to cross out the name of Center Party candidate environmentalist Valdas Adamkus, one of the most popular men in Lithuania, because he has both U.S. and Lithuanian citizenship, BNS reported. -- Saulius Girnius

POLISH RULING PARTY TO DISCLOSE ASSETS.
A Warsaw court ordered the Social Democracy of the Polish Republic (SdRP) to submit an account of its assets, Polish media reported on 21 February. The motion was made by government-appointed liquidators of the property formerly belonging to the Polish United Workers' Party (PZPR), which became the SdRP at the January 1990 congress. The SdRP incurred debt after continuing to use PZPR property, which now belongs to the state. The party says that its coffers are empty and it had to use profits from PZPR property to cover obligations to the old PZPR apparatus. Liquidators countered that the SdRP spent heavily on the election campaign. The SdRP owes 1 million zloty ($330,000) plus interest, and liquidators have asked for another 20 million. An SdRP representative said the party will not appeal the ruling. -- Beata Pasek

CZECH PREMIER IN CANADA.
After meeting with Czech Prime Minister Vaclav Klaus, who is on a week-long visit to Canada, Canadian Prime Minister Jean Chretien said on 20 February it was time to live up to promises to enlarge NATO despite Russian misgivings, international media reported. Chretien said he backed membership by the Czech Republic, Poland, Hungary, Slovenia, Slovakia, and Romania, though he noted they would not all be able to join in the first stage of expanding the alliance. "The time has come for us to live up to our promise. When the Czech Republic decided to become a democracy and to become a market economy, we said clearly at the time that it should become a member of NATO one day," Chretien said. -- Jiri Pehe

SLOVAK RULING COALITION HEADED FOR COLLAPSE?
Association of Workers (ZRS) Chairman Jan Luptak on 20 February said his party is determined to support the bill banning bank privatization even if it is linked to a confidence vote in the government, TASR reported. Still, Luptak said he does not want to break up the ruling coalition and does not support early elections. He said it would be sad if the ruling coalition collapsed because of bank privatization. The ZRS will ask the National Bank of Slovakia for an inspection of the country's four largest banks, to be carried out by the Supreme Supervisory Office or by independent auditors. Also on 20 February, a poll released by the Focus agency showed that Prime Minister Vladimir Meciar is still the most trusted politician in Slovakia. Meciar had the trust of 20.7% of respondents, followed by Parliament Chairman Ivan Gasparovic with 17.4% and President Michal Kovac with 16.3%. -- Sharon Fisher

SLOVAK ROUNDUP.
Some 400 Slovak cultural representatives on 20 February gathered in Bratislava to protest against government cultural policies, Slovak media reported. The meeting was called by the Save Culture forum that was established last year following Culture Minister Ivan Hudec's interference in the Slovak National Theater's internal affairs. The group called for Hudec's resignation and appealed to the Culture Ministry to return cultural institutions' independence. In other news, President Michal Kovac has won a lawsuit against the pro-government daily, Slovenska Republika, CTK reported on 20 February. In fall 1995, the daily had published several articles about Kovac's alleged Austrian bank account. An obviously forged bank statement published by the daily showed large sums of money. The court ruled that the paper must publish an apology, and it ordered the daily's former editor in chief, Jan Smolec, to pay the president 500,000 crowns ($16,000) in damages. -- Sharon Fisher

SLOVAK MINORITY LANGUAGE LAW DISCUSSED IN BUDAPEST.
Max van der Stoel, the OSCE high commissioner on national minorities, met with Hungarian Foreign Minister Laszlo Kovacs on 20 February in Budapest, Reuters reported. Van der Stoel urged Slovakia to pass the long-delayed law on minority languages. Kovacs recently appealed to Slovakia to approve the law, saying Bratislava is violating international commitments by delaying the legislation. Since financial penalties for violating Slovakia's state language law went into effect in January, Hungarian-language schools have stopped issued bilingual grade reports, which has caused great controversy among ethnic Hungarian parents. In other news, the International Court of Justice on 20 February announced that it will open hearings on 3 March on the Gabcikovo-Nagymaros dam dispute between Slovakia and Hungary. -- Sharon Fisher

PHILIPS TO BUILD PLANT IN HUNGARY.
Officials from the Dutch electronics group Philips on 20 February announced plans to build a car radio plant in Gyor in northwestern Hungary, AFP and Hungarian media reported. The factory, which will start production next July, will have the capacity to manufacture 5 million car radios annually, primarily for export. Philips plans to invest 30 million dollars in the plant over the next two years. The factory will initially employ 600-800 workers and eventually 1,000. Philips has already invested $80 million in Hungary and employs 5,200 workers. -- Sharon Fisher


SFOR ATTACKED IN MOSTAR, BOSNIA.
An armored vehicle of the NATO-led Stabilization Force was hit by a tank rocket on 21 February on the former front line in the divided southern city of Mostar, AFP reported. No one was injured. According to a spokesman, the rocket came "from the western [Croat-held] side of the river." Meanwhile, SFOR has withdrawn the accreditation of a UNHCR official in Mostar, Jacques Franquin, who had said that SFOR troops were "useless" during the Muslim-Croat clash in Mostar on 10 February that resulted in one dead and over 30 wounded. Franquin was declared persona non grata for his comments, described as a "personal and individual assessment," AFP reported on 19 February. In other news, UN human rights envoy Elisabeth Rehn visited Mostar on 20 February and called for the resignation of those responsible for the recent violent incident. Rehn called on the Croatian government to exert pressure on Bosnian Croats to respect human rights in Herzegovina. -- Daria Sito Sucic

BOSNIA FAILS TO AGREE ON COMMON ECONOMIC RULES.
The Bosnian Council of Ministers on 20 February failed to adopt a quick-start package of draft laws because of differing opinions of the two Bosnian entities composing the council, Onasa reported. One of the council's two co-chairmen, Haris Silajdzic, a Muslim, said the officials discussed draft laws on privatization, property restitution, and ownership relations and agreed on rules of procedure. While Silajdzic says that such laws are the responsibility of Bosnia and the Council of Ministers, the Serbian co-chairman, Boro Bosic, says they are the responsibility of the respective entities. The council also discussed an unpaid gas bill of the Republika Srpska, for which the Russian gas supplier GazExport threatens to cut off gas supplies to Bosnia. Bosic said the Republika Srpska will pay its part of the debt. GazExport will significantly reduce gas deliveries to Bosnia starting 24 February, Onasa reported. -- Daria Sito Sucic

SERBIAN UPDATE.
Zoran Djindjic, head of the Democratic Party and a leader of the opposition Zajedno coalition, is to become Belgrade's first non-communist mayor in 52 years on 21 February, local independent media reported. Djindjic said reform of the state-run electronic media, controlled by Serbian President Slobodan Milosevic, is his priority. "Starting March 9, we will demonstrate daily in front of the [state-run] television," he said. In unrelated news, Vladan Kovacevic (also known as Vlada Tref), a 39-year-old business partner of Milosevic's son Marko, was gunned down in a hotel parking lot on 20 February. -- Stan Markotich

MACEDONIAN STUDENTS CONTINUE PROTESTS AGAINST ALBANIAN-LANGUAGE TUITION.
Several thousand ethnic Macedonian students on 20 February continued their protest against a new law introducing lessons in Albanian at the teacher-training faculty (see OMRI Daily Digest, 18 February 1997), AFP reported. It was the fourth consecutive day of protest against the law. The protesters called for the resignation of Education Minister Sofija Todorova. Despite the protests, the teacher-training faculty at Skopje university went ahead with lessons in Albanian and said it was recruiting teachers. -- Stefan Krause

INFLATION REACHES NEW RECORD IN ROMANIA.
The monthly inflation rate rose to a record 13.7% in January, Romanian and Western media reported. The surge follows recent steps taken by the government to deregulate currency rates and prices and eliminate subsidies for energy and staples. The measures are part of a shock therapy program aimed at healing the ailing Romanian economy. Radio Bucharest quoted Romanian National Bank Director Mugur Isarescu as saying that the annual inflation rate for 1997 would be 90%, less than a 97% forecast made by Premier Victor Ciorbea. -- Dan Ionescu

FRENCH PRESIDENT ON ROMANIA AND NATO.
In an interview with the Bucharest daily Adevarul published on 20 February, Jacques Chirac said he tried to gather support for Romania's application to join NATO during recent talks with U.S. Secretary of State Madeleine Albright. He praised Romania's democratic change of power of last November and the "historic accord" with Hungary signed last September. Chirac said that Romania is "very important [for NATO], especially for the southern flank" and that France will spare no efforts to convince its NATO allies that Romania must be part of the first wave of enlargement. The French president is expected today in Bucharest for a two-day visit. -- Zsolt Mato

ROMANIAN PRISONERS' PROTEST SPREADS TO NINE CITIES.
The protest of Romanian inmates against poor living conditions, started on 17 February in Bucharest, has spread to nine cities across the country, Libertatea reported on 21 February. While most of the protesters are peacefully hunger striking, in some prisons the inmates have become violent, setting fire to their prisons. (See OMRI Daily Digest, 20 February) -- Zsolt Mato

ROMANIA'S CURRENT, FORMER PRESIDENTS DUEL OVER PRIVILEGES.
Former President Ion Iliescu rejected a proposal by current President Emil Constantinescu that the parliament passes a law granting Iliescu a flat, a car, and a team of bodyguards. He described the offer as "hypocritical" since, he said, it came after a series of political attacks on him. Iliescu added that he wanted a "public apology" instead of "acts of reparation" and stressed that he already owns a flat, which he bought while still president. The prime minister's control office, however, recently denounced as "illegal" Iliescu's purchase of an apartment that had been nationalized by the Communists in the 1950s. -- Dan Ionescu

NEW PARTY SET UP IN MOLDOVA.
Some 400 delegates in Chisinau on 19 February set up a new party, BASA-press reported. The new formation, the United Labor Party of Moldova (PUMM), defines itself as a centrist party in quest of a "third way," distinct from capitalism and socialism. PUMM leader Andrei Safonov, a leading political scientist in Moldova's breakaway Dniester region, said his organization will favor market economy reforms while promoting a high level of social protection. -- Dan Ionescu

BULGARIA'S EMPLOYMENT, FOOD, ENERGY WOES DEEPEN.
Unemployment in Bulgaria reached 13.4% in January, the highest level since July 1994, Pari reported on 21 February. Observers fear that unemployment may double this year after a currency board is introduced. Meanwhile, the country's bread shortage has worsened, with Sofia having only enough flour for 5-6 days; caretaker Premier Stefan Sofiyanski said wheat will be taken from the state's reserves to fill the gap. Bulgargas has stopped supplying Russian gas to 63 industrial plants that did not pay their bills for January and February. The current price covers only one-third of the cost of the gas, for which the Russians now demand full advance payment in hard currency. Finally, the interim cabinet on 20 February set up a Structural Reform Council to negotiate with the IMF and World Bank on industrial reforms. -- Michael Wyzan

BULGARIAN INTERIM PREMIER ON NUCLEAR PLANT.
Stefan Sofiyanski on 20 February said the controversial Kozloduy nuclear power plant should not be shut down, RFE/RL reported. Sofiyanski reacted to a statement by Energy Minister Georgi Stoilov the previous day that Kozloduy is highly dangerous and the risk from it is "above the socially acceptable limits." Sofiyanski refused to comment on the reactor's security and said he has not discussed the issue with Stoilov. Kozloduy's director, Kiril Nikolov, called the plant "absolutely safe." In other news, former Tsar Simeon II sent a letter to royalist organizations saying he will publicly distance himself from them if they fail to unite before the April elections, 24 chasa reported. Various monarchist organizations will meet in Varna on 22 February to decide on a joint electoral list, separate from the main opposition Union of Democratic Forces. -- Stefan Krause

MORE VIOLENCE IN ALBANIA.
As protests against the government of President Sali Berisha, triggered by the collapse of a series of pyramid schemes, continued into a sixth week in Tirana, violence once again surfaced. Riot forces prevented some 1,000 supporters of the opposition from marching to the central part of the capital, Reuters reported. Marchers hurled stones at the police, who retaliated with shots into the air. Meanwhile, some senior members of the Democratic Party on 20 February urged the government to resign, AFP reported. -- Stan Markotich

[As of 1200 CET]

Compiled by Victor Gomez and Susan Caskie




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