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Newsline - February 27, 1997


MORE CABINET RESHUFFLE RUMORS.
The minister most likely to be sacrificed in the coming cabinet reshuffle appears to be Defense Minister Igor Rodionov. President Boris Yeltsin's press service on 26 February said Yeltsin disapproved of Rodionov's recent remarks on the state of affairs in the military, Russian media reported (see OMRI Daily Digest, 24 and 26 February 1997). Rodionov's most likely replacement, according to the 27 February Izvestiya, is Far East Military District Commander Viktor Chechevatov. Other likely candidates for dismissal include Labor Minister Gennadii Melikyan and Viktor Ilyushin, first deputy prime minister in charge of social issues. While Izvestiya and Argumenty i fakty continued to speculate that Prime Minister Viktor Chernomyrdin will be sacked, Nezavisimaya gazeta and Komsomolskaya pravda on 27 February predicted that Chernomyrdin will remain in office, with Presidential Chief of Staff Anatolii Chubais returning to the post of first deputy prime minister, which he held until January 1996. -- Laura Belin

BUDGET SIGNED INTO LAW.
On 25 February Yeltsin signed into law the 1997 budget, NTV reported the next day. The budget plans expenditure of 530 trillion rubles ($76 billion), including 104 trillion on defense, 47 trillion on internal security, 18.5 trillion on education, and 10 trillion on social policy. With income of 434 trillion rubles and a deficit of 95 trillion (3.5% of GDP), the budget formally complies with the deficit guidelines agreed with the IMF, but there are question marks over the government's capacity to actually implement the budget. Prime Minister Viktor Chernomyrdin admitted that 40 trillion rubles of expenditure carried over from 1996 are "not covered" by revenues at present, Russian TV (RTR) reported. -- Peter Rutland

LUZHKOV ON UNION WITH BELARUS.
Speaking at a conference on Russia and Belarus on 26 February, Moscow Mayor Yurii Luzhkov called for reorganisation of the Russian Federation and a merger with Belarus in a confederation, AFP and Kommersant-Daily reported. Luzhkov said the number of Federation subjects should be reduced from 89 to some 10-12, which Belarus could join. Last month, President Boris Yeltsin, who plans to meet Belarusian President Alyaksandr Lukashenka on 7 March, sent him a letter proposing a referendum on a merger of the two states, following up the April 1996 union treaty. Luzhkov's proposal is unlikely to appeal to Lukashenka, who insists on a merger of two equal states. -- Nikolai Iakoubovski

FOREIGN MINISTER IN DENMARK.
"The Baltic states' entry into NATO would be unacceptable to Russia," Yevgenii Primakov said at the conclusion of his visit to Denmark on 26 February, ITAR-TASS reported. "We do not veto the issue, but we say that this is unacceptable to us. Should this happen, it would undermine our relations with NATO entirely," Primakov said, adding that he would see the Baltics' entry to the EU as a "positive" development. Primakov noted that Denmark, a NATO member, like Norway has no foreign troops or nuclear weapons on its territory. He said "the ball is now in NATO's court" with respect to NATO expansion, and that he is waiting a response to Russia's proposals for a binding agreement. Writing in the European on 27 February, Russian ambassador to the UK Anatolii Adamishin said NATO should change its name, "which has too many odious associations in Russia. ... After all, we are not the USSR any more." -- Peter Rutland

RUSSIAN DESERTERS TO STAY IN GERMANY.
On 25 February, the parties in Germany's ruling coalition agreed in principle to give 600 Russian soldiers and their families the right to political asylum in Germany, Reuters reported. The soldiers deserted from the 340,000 Soviet troops who were based in East Germany until 1994. The German government planned to return them to Russia, but human rights groups and German veterans organizations complained that the soldiers could face prison sentences of 10 to 20 years for treason. On 25 February, Interior Ministry State Secretary Eduard Lintner admitted that 530 of the soldiers had been questioned by German intelligence services, and the next day Foreign Minister Klaus Kinkel said Russia had refused to grant them amnesty. -- Peter Rutland

NOVOROSSIISK PIPELINE.
In an interview with Turan on 26 February, Chechen field commander Shamil Basaev said Chechnya is prepared to conclude an agreement with "the owners" of the Caspian oil that will be exported via Novorossiisk to guarantee the safety of the entire length of the Baku-Novorossiisk pipeline. He also expressed gratitude for Azerbaijan's "invaluable assistance" to Grozny during the war with Russia and offered Chechnya's assistance (not necessarily military) in restoring Azerbaijan's territorial integrity, adding that he considered that peace between Armenia and Azerbaijan is contingent on Russian mediation. -- Liz Fuller

MORE CORRUPTION CHARGES AGAINST GOVERNMENT OFFICIALS.
The Pacific Fleet Procurator's Office has begun criminal proceedings against Russian Navy Chief of Staff Admiral Igor Khmelnov for abuse of office, Ekho Moskvy reported on 26 February. Khmelnov, who used to command the Pacific Fleet, is accused of misusing money the fleet received from the sale of ships to South Korea. Khmelnov promised to use the proceeds from the deal (worth $9 million) to provide officers with housing, but he allegedly distributed most of the apartments among friends and relatives. Meanwhile, Kommersant-Daily reported on 27 February that Moscow police detained a department head in the Health Ministry, Aleksei Solovev, on suspicion of extortion and bribe-taking. One of Solovev's predecessors was also arrested for swindling. The paper ran several reports on the Balkar-Trading company scandal, in connection with which former Procurator General Aleksei Ilyushenko was arrested. The articles suggest that other high-ranking officials also participated in corrupt deals. -- Penny Morvant

EXCISE STAMPS INTRODUCED FOR RUSSIAN TOBACCO PRODUCTS.
In an attempt to boost revenues, the government issued a resolution on 25 February requiring all domestically produced tobacco products sold after 1 June to carry excise stamps, ITAR-TASS and Segodnya reported. Tobacco manufacturers must conduct inventories on 1 April, the date on which the stamps will be introduced, and they have two months to sell their remaining products. Imported tobacco as well as cigarettes produced under license in Russia already carry stamps, and the government initially sought to extend the practice to cover Russian tobacco by 1 July 1996. Implementation of the new rules was postponed, however, when government credits to help manufacturers purchase machinery to attach the stamps were not released in time. -- Penny Morvant

JUDICIAL CHAMBER REPRIMANDS NOVAYA GAZETA.
The President's Judicial Chamber on Information Disputes has found that an open letter published this month in Novaya gazeta contained false information intended to damage the reputation of Eduard Sagalaev, then-chairman of Russian TV (RTR). The publication, in which current and former RTR executives accused Sagalaev of financial improprieties and poor management, sparked a scandal that quickly led to Sagalaev's resignation (see OMRI Daily Digest, 4 and 10 February 1997). The chamber's decision, published in Rossiiskaya gazeta on 26 February, found that in violation of Russian law, Novaya gazeta's editors made no attempts to confirm the accuracy of the information contained in the letter. The chamber is only a consultative body, but it referred the case to the Moscow Procurator's Office to examine whether the letter's authors or the newspaper's editors could be prosecuted for libeling Sagalaev. -- Laura Belin

ROUND TABLE CALLS FOR DEFENDING WOMEN'S RIGHTS.
A Moscow round table organized by the Union of Women and the Union of Journalists called for action to provide women with the equal rights and opportunities guaranteed in theory by the Russian constitution, ITAR-TASS and Russian TV (RTR) reported on 26 February. Participants criticized the media for biased reporting, publications "insulting" to women, and sexist job advertisements. However, Union of Women leader Alevtina Fedulova said the media were merely reflecting the "second-class" status of women in Russian society, which she blamed on a "centuries-old patriarchal tradition." She added that the only privileges currently enjoyed by Russian women are higher rates of poverty and unemployment. Union of Journalists Chairman Vsevolod Bogdanov promised to raise the issue with newspaper editors and to create an annual award for the best media coverage of women's problems. -- Laura Belin

YELTSIN FIRES PHOTOGRAPHER.
President Yeltsin sacked his personal photographer, Dmitrii Sokolov, for being drunk on duty, ITAR-TASS reported on 26 February. Sokolov, who had worked with the president since 1987, was on the staff of the Presidential Security Service (SBP). Moskovskii komsomolets claimed several other SBP members were also fired, including the official responsible for arranging Yeltsin's trips abroad. The reason for the dismissals, the paper alleged, was a loud party in the Kremlin to celebrate the 9 February victory of former SBP head Aleksandr Korzhakov in a by-election in Tula. Komsomolskaya pravda on 27 February claimed there had been two parties--one to celebrate Korzhakov's victory and one, organized by Anatolii Chubais' circle, to celebrate the appointment of Nikolai Svanidze to head RTR. The paper claimed that Sokolov got into a fight with TV journalist Sergei Dorenko. Also on 26 February, Radio Mayak said Mikhail Lesin had resigned from his position as chief of public relations for the presidential administration. -- Penny Morvant

YELTSIN SIGNS LAW ON HUMAN RIGHTS COMMISSIONER.
President Yeltsin on 26 February signed the constitutional Law on the Russian Federation Human Rights Commissioner, ITAR-TASS reported. The commissioner, who is responsible for overseeing state protection of individuals rights and freedoms, is appointed and dismissed by the Duma by secret ballot. The bill was passed by the Duma on 25 December (see OMRI Daily Digest, 31 January 1996) and by the Federation Council on 12 February. -- Penny Morvant


MINSK GROUP CO-CHAIRS TO RESUME STALLED TALKS ON NAGORNO-KARABAKH.
Representatives of Russia, France, and the U.S.--the three co-chairs of the OSCE's Minsk group, which sponsors negotiations on the Nagorno-Karabakh conflict's settlement--met in Copenhagen to discuss ways of reviving the deadlocked peace process, RFE/RL reported on 26 February. The three agreed that "more preparations" are necessary before the talks can resume and that a French fact-finding team will be sent to the region next week to meet with all sides to the conflict. According to ITAR-TASS, a new round of negotiations is scheduled for April. -- Emil Danielyan

ARMENIAN FOREIGN MINISTER MEETS WITH REPRESENTATIVES OF BANNED PARTY.
Aleksandr Arzumanyan, on 25 February met in Washington with leaders of the Dashnak party (HHD), banned in Armenia since December 1994, Asbarez-on-line reported. Arzumanyan stressed the importance of "national unity" for a settlement of the Nagorno-Karabakh dispute. A day earlier, Armenia's ambassador to Greece visited the HHD headquarters in Athens and discussed the Nagorno-Karabakh problem. Contacts between Armenian high-ranking officials and the HHD, the leading Armenian Diaspora organization, resumed last December after President Levon Ter-Petrossyan called for a "consolidation" of all Armenians in the world. -- Emil Danielyan

TURKMEN PRESIDENT IN INDIA.
Saparmurad Niyazov concluded a two-day state visit to India on 26 February, international media reported. Niyazov held talks on regional issues, notably Afghanistan, and bilateral cooperation with his Indian counterpart Dayal Sharma and top Indian government officials. Bilateral agreements in the spheres of economics, culture, health, communications, and the environment were signed, RFE/RL reported. Meanwhile, an outbreak of typhoid fever has reportedly hit Ashgabat, RFE/RL reported on 26 February. -- Lowell Bezanis

KAZAKSTAN UPDATE.
Presidential adviser Asylbek Beysenbayev will lead the newly formed Liberal Movement, RFE/RL reported on 25 February. Speaking at Almaty's Democracy House, Beysenbayev said his movement sought to hold the middle ground between the government and its conservative opposition. In other news, Kazakstani officials banned Russian TV-6 Moskva, Kazak Totem TV, Totem Radio, and Radio Max, Reporters sans Frontiers reported on 25 February. The same day, Russian media reported that Kazakstan's new criminal code has been finalized; the code provides for fines and public works instead of imprisonment for some crimes. The death penalty remains for premeditated murder, the attempted murder of a state official, and military crimes or high treason in time of war. The draft criminal code has been 6 years in the making and must be approved by parliament. Finally, a consortium headed by the Malaysian firm Mega Meisa will build and operate a $1.3 billion coal-fired power plant in Kazakstan, RFE/RL reported on 26 February. -- Lowell Bezanis

UZBEK PRESIDENT ON ECONOMIC PERFORMANCE.
Islam Karimov told a government assembly 1996 was a "year of economic and financial stabilization," RFE/RL reported on 26 February. He said, the budget deficit did not exceed 3.5%, inflation was cut in half (he gave no figures), the national currency strengthened, and foreign trade was over $9.3 billion dollars. He called for 1997 to be a "year of human interests" and social security for all. The same day, the head of the U.S. Overseas Private Investment Corporation, Ruth Harkin, held talks with Karimov and other top officials in Tashkent. Harkin is checking on Amercian investment projects the OPIC has underwritten. The OPIC has provided $200 million worth of political risk insurance and financing for U.S. projects in Uzbekistan. -- Lowell Bezanis


CONTINUED CABINET RESHUFFLE IN UKRAINE.
President Leonid Kuchma has named three new ministers after firing their predecessors for unsatisfactory performance (see OMRI Daily Digest, 26 February 1997), international media reported. Former Deputy Finance Minister Ihor Mityukov takes over the finance portfolio, while former Economy Minister Vasyl Hureyev is the new machine-building and defense conversion minister. Yurii Yekhanurov, head of the State Property Fund, has been appointed economy minister. Former Donetsk Oblast Governor Volodymyr Shcherban has been offered the post of statistics minister. President Kuchma said the cabinet shake-up--which is the second this month--was necessary to improve the country's economy. Volodymyr Horbulin, a close associate of the president, said changes in the cabinet will continue, but he stressed that Prime Minister Pavlo Lazarenko will remain in his post. -- Oleg Varfolomeyev

BELARUSIAN ECONOMIC CRISIS DEEPENS.
The parliament has adopted a resolution criticizing the government's agricultural policies, Belapan reported on 26 February. Henadz Usyukevich, head of the parliamentary Committee for the Development of the Agro-industrial Complex, said the country is threatened by major food shortages. He alleged that the government is extorting money from farmers by forcing them to sell foodstuffs to the state cheaply and that it is also withholding benefits from those who refuse to sell their produce at state prices. The same day, an RFE/RL correspondent reported that the IMF has compiled a critical report on Belarus. Although the IMF has refused to comment on the existence of the report, Belarusian newspapers published fragments of the document, which asserts that the state has "interfered excessively" in almost every aspect of the economy. -- Ustina Markus

LATVIA RECOGNIZES CURRENT BORDER WITH RUSSIA.
Aivars Vovers, head of the Latvian delegation discussing the Latvian-Russian border, said that at talks in Moscow on 24-25 February, Latvia agreed to recognize the current border, BNS reported the next day. Latvia is no longer demanding that the border agreement include a reference to the 1920 Riga Peace Treaty, which stated that the Abrene district belonged to Latvia. Vovers said that the border agreement would not mention Abrene property issues, but he added that he hoped those issues could be resolved in another way. The next round of talks are scheduled to begin in Riga on 20 March. -- Saulius Girnius

LITHUANIAN PRESIDENT'S VISIT TO GREECE.
Algirdas Brazauskas, during his three-day visit to Greece from 24-26 February, met with Greek President Kostis Stephanopoulos and Prime Minister Kostas Simitis, BNS reported. The two presidents agreed on all major foreign-policy issues, and Stephanopoulos confirmed Greece's support for Lithuania's admission to NATO and the EU. Foreign Ministers Algirdas Saudargas and Theodoros Pangolos signed an agreement on educational, cultural, and scientific cooperation. Parliamentary chairman Apostolos Kaklamanis assured Brazauskas on 25 February that Greece will soon ratify Lithuania's association agreement with the EU. -- Saulius Girnius

SUSPECTED ARSON ATTACK ON WARSAW SYNAGOGUE.
The entrance to Warsaw's only synagogue was destroyed soon after midnight on 26 February in what appears to have been an arson attack, international media reported. "Our initial conclusions show the cause was probably arson," a Warsaw police spokesman said, adding that the police believed some kind of "inflammable substance was thrown in through a window over the entrance." Jewish community leaders invited Warsaw inhabitants to attend an evening service on 26 February in a show of solidarity. Several hundred filled the synagogue, including the Warsaw Mayor Marcin Swiecicki and deputies. President Aleksander Kwasniewski, Catholic Episcopate Secretary Tadeusz Pieronek, and the Internal and Foreign Affairs Ministries condemned the attack as "barbaric." The Lauder Foundation, which aims to preserve Jewish culture and has its headquarters above the synagogue, received telephone warnings of a bomb attack two days previously. Bomb disposal experts found nothing suspicious at that time. -- Jakub Karpinski

BULGARIAN PRESIDENT IN POLAND.
Petar Stoyanov arrived in Poland on 26 February on the first leg of his tour of East Central European countries. Addressing the Polish parliamentarians, he noted that in addition to seeking NATO membership, Bulgaria wants to join the Central European Free Trade Agreement (CEFTA). But Bulgaria's debt of more than $100 million to Poland is an obstacle. Spokesman Antoni Styrczula said that President Aleksander Kwasniewski is considering allowing Bulgaria to settle the debt after joining CEFTA. Stoyanov is also due to visit the Czech Republic and Hungary over the next few days. -- Jakub Karpinski

CZECH DEPUTIES APPROVE LEGISLATION ON BORDER WITH SLOVAKIA ...
The lower chamber of the Czech parliament on 26 February approved a constitutional amendment delineating the Czech-Slovak border, Czech media reported. The amendment is based on a border agreement reached in early 1996 by the Czech and Slovak Interior Ministries. Slovak deputies last year approved an amendment based on that agreement. But the Czech parliament rejected an equivalent amendment, with opposition parties arguing that the accord was unjust because the Czech village of U Sabotu would wind up in Slovakia. It has now approved the amendment because the government has committed itself in an accompanying resolution to compensate those inhabitants of U Sabotu who want to move to the Czech Republic. Slovakia is giving up the village of Sidonie. The amendment still has to be approved by the parliament's upper chamber. -- Jiri Pehe

... AND URGENTLY-NEEDED HEALTH-INSURANCE LAW.
The same day, the Czech legislature approved a bill defining which health care services are to be paid for by health insurance companies, Czech media reported. The law had to be adopted quickly because the Constitutional Court last year ruled that various government decrees on the health insurance system were unconstitutional and would become invalid on 1 April 1997. In the absence of a new law, the Czech health care system would have had to revert to the socialist, state-run model that existed before 1990. With such a prospect looming, the law, which is valid only until June 1998, received the conditional support of the opposition Social Democrats, who otherwise are opposed to it. The government is currently drawing up a comprehensive reform of the health care system. -- Jiri Pehe

OECD DENIES SPECIFYING CONDITIONS FOR SLOVAK MEMBERSHIP.
The Organization for Economic Cooperation and Development (OECD) has not specified conditions for Slovak membership in the organization, an OECD official told CTK on 26 February. The denial follows Premier Vladimir Meciar's claim that speedy privatization of banks is a condition for entry into the OECD. The official noted that bank privatization is an important issue but by no means the only one. He added that the OECD is interested in "transparent and just" privatization and in how foreign investors are treated. The Slovak parliament has halted the privatization of banks till 2003, while the government asked the president to return the law on bank privatization to the legislature. -- Anna Siskova

GERMAN PRESIDENT IN HUNGARY.
Meeting with representatives of the 200,000 ethnic Germans living in Hungary, Roman Herzog on 26 February praised that country for its "exemplary" minority policy, Hungarian media reported. The previous day, the German president had reassured the Hungarian parliament that Germany supports Hungary's bid for EU and NATO integration. He warned, however, that aspiring member countries will have to bear most of the integration costs. He also called for a European partnership with Russia and Ukraine in order to maintain peace in Europe. Herzog also spoke with Jewish Holocaust survivors who were protesting Germany's delay in making compensation payments. He said an agreement with Hungary on the issue would be signed "within a very short period." -- Zsolt Mato


FOUR ALBANIAN HUNGER STRIKERS IN SERIOUS CONDITION.
Four students taking part in a hunger strike in Vlora to demand the resignation of the government are in serious condition, AFP reported on 26 February. Some 45 students have been taking part in the protest action for the past eight days. Special police troops tried to break up the strike, but thousands of city residents forced them back from the university building, where the strike is taking place. Some shots were heard, and the crowd hurled stones at the troops. No injuries were reported. In a show of support for the students, some 120 people from Shkoder--including rightist Mayor Bahri Borici--traveled in buses and cars to Vlora. People from other towns also arrived in Vlora to join the protests. Meanwhile in Gjirokastra, President Sali Berisha met with students but was jeered when he rejected their demands. -- Fabian Schmidt

SECURITY IN TIRANA TO BE INCREASED.
The Democratic Party has said it will increase security in the capital, Reuters reported. The party's central committee said it is imposing a "state of preparedness" to "guarantee stability in all of Albania." It pointed to plans by opposition parties to hold a rally in Tirana, but it was unclear what measures would be taken or how long they would be enforced. Security forces will likely maintain an increased presence until 8 March; if parliament is to re-elect Berisha for a second term, it must do so by that date. Some 300 Tirana University students have demanded a meeting with Berisha to discuss violence against peaceful demonstrators. They have also threatened to start a hunger strike if Berisha does not agree to meet with them. -- Fabian Schmidt

MONTENEGRIN OFFICIAL SPEAKS OUT ON RELATIONS WITH SERBIA ...
Another top ranking Montenegrin official on 26 February has publicly said there are fundamental disagreements between the governments of Serbia and Montenegro, Nasa Borba reported the next day. Montenegrin parliamentary speaker Svetozar Marovic defended Premier Milo Djukanovic against recent scathing criticism by the Belgrade state media. He added that the premier's concerns about the authoritarianism of Serbian President Slobodan Milosevic's regime were by no means personal or isolated (see OMRI Daily Digest, 24 February 1997). Marovic, however, stressed that he did not advocate outright independence for Montenegro. If the federation were to stay together, politicians would have to learn to "push ideology aside," he commented. -- Stan Markotich

... WHILE MONTENEGRIN PRESIDENT SAYS HE WANTS TO COOPERATE WITH BELGRADE.
Meanwhile, Momir Bulatovic is seeking to ease tension between the two republics. In a 26 February letter to the U.S. Congress, he said he stood for working together with Milosevic. "My chief political mandate is cooperation with Milosevic because both of us have spoken out for democratic and economic development in Yugoslavia," he wrote. In other news, leaders of the Serbian opposition Zajedno coalition met with exiled Prince Alexander near his London home on 26 February, Reuters reported. Vuk Draskovic, head of the Serbian Renewal Movement and an arch-advocate of the restoration of the monarchy, commented that Alexander could have a profound political role in the Federal Republic of Yugoslavia. He compared the exiled monarch to Spain's King Juan Carlos, who ushered in democratic reforms. -- Stan Markotich

UN RELEASES "SHOCKING" REPORT ON MOSTAR CLASHES ...
The UN has released its report on the violent clashes between Muslims and Croats earlier this month that left one dead and 34 wounded, according to AFP on 26 February. The report includes photographs of three plain-clothes Croatian police officers firing on an unarmed retreating Muslim crowd. The Croatian police have been suspected of persecuting Muslims from the western half of Mostar, which they control, but few direct accusations have been made against them. Mostar Croatian Mayor Ivan Prskalo said the Croatian side rejects the report as incomplete, Oslobodjenje reported on 27 February. But Deputy High Representative for Bosnia-Herzegovina Michael Steiner urged the International Contact Group members to press Croats to arrest and dismiss those singled out in the report. British Foreign Secretary Malcolm Rifkind said the report is "shocking" and tells an "appalling story." He called on the Croatian government to exert influence over the Croatian authorities in Mostar to abide by the report's recommendations, Reuters reported. -- Daria Sito Sucic

... WHILE CROATS CRACKS DOWN ON NATIONALISTS.
Meanwhile, Steiner said he has reports that 20 people have been arrested in Mostar over the past couple of days but not the Croatian police officers shown on the photographs in the UN report, Oslobodjenje reported. The daily also reported that, in the apparent crackdown on Croatian nationalists in West Mostar, another prominent warlord--Vinko Martinovic--has escaped arrest. In other news, the Croatian police on 27 February said they have arrested Mladen Naletilic Tuta, the head of a crime ring in the Croat-held part of Mostar, international agencies reported. According to Hina, Tuta was arrested on 24 February near Split and brought to prison in Zagreb for questioning. But no charges have been filed against him. -- Daria Sito Sucic

NEW SUPREME COURT HEAD IN CROATIA.
The chief judicial screening committee on 25 February approved the government's recommendation of Milan Vukovic (64) to head Croatia's top judicial body, international news agencies reported. One of Vukovic's new duties will be to supervise the 13 April local elections. Vukovic is considered a loyalist to President Franjo Tudjman and his Croatian Democratic Community (HDZ), and his appointment is widely seen as yet another move to thwart the independence of the judiciary. Last year the government began moves to oust the independent-minded former Chief Justice Krunoslav Olujic, who finally lost his job in January. Olujic validated the results of the October 1995 vote in which the HDZ suffered a number of humiliating losses. -- Patrick Moore

DONORS' CONFERENCE PROMISES MACEDONIA $65 MILLION.
Delegates to the Brussels donors conference sponsored by the EU and the World Bank have promised Macedonia $65 million in loans for 1997, Nova Makedonija reported on 27 February. The EU will provide $50 million of that amount as a 15-year credit with a ten-year grace period. The loans partly cover an expected $85 million budgetary shortfall. Kenneth Lay, director of the World Bank's Southeast Europe Department, said that "more than any other country in the region, Macedonia has adopted and aggressively pursued the kind of reform we want to see," Reuters reported. Meanwhile, Italian President Oscar Luigi Scalfaro, on a visit to Macedonia on 26 February, said he supported Macedonia's bid for full EU and NATO membership. In addition to meeting with President Kiro Gligorov, Scalfaro signed an agreement protecting Italian investment in Macedonia and on cooperation between the countries' foreign ministries. -- Michael Wyzan and Fabian Schmidt

CORRUPTION CHARGES BROUGHT AGAINST BUCHAREST COUNCILOR.
Ioan Itu, a councilor in the Bucharest Mayor's Office, has been detained on bribery charges, Radio Bucharest reported on 26 February. This is the first arrest of a member of the ruling Democratic Convention of Romania (CDR) since the CDR-dominated government launched a nation-wide campaign against corruption and economic crime. Itu is accused of trying to extort a computer from a Foreign Ministry employee in exchange for helping obtain commercial premises. The press office of the National Peasant Party-Christian Democratic (PNTCD), the main member of the CDR, said that Itu is practically unknown and that the PNTCD will not interfere with the course of justice. -- Dan Ionescu

MOLDOVA AGREES TO LINK RUSSIAN PULLOUT TO DNIESTER ACCORD.
President Petru Lucinschi has agreed to link the withdrawal of the Russian troops from Moldova's breakaway Dniester region to a political settlement for that territory, Reuters reported on 26 February. Lucinschi made the announcement at a press conference in Moscow, one day after he met with his Russian counterpart, Boris Yeltsin. He added that the Russian contingent would be reduced from 6,000 to some 2,500 men, irrespective of the final political settlement of the Dniester conflict. He was also quoted as saying that the complete withdrawal of Russian troops without a peace accord would create a security vacuum in that region. Lucinschi is on his first visit abroad since he officially took office in mid-January. -- Dan Ionescu

BULGARIA, IMF CLOSE TO AGREEMENT ON CREDIT.
IMF Bulgaria mission chief Anne McGuirk on 26 February said the fund will probably agree on a standby credit with the interim government, the daily Duma reported. The government is to draw up a letter of intent on its reform intentions before the mission leaves, by the end of next week. The IMF's executive board will consider that letter by the end of March, and the first tranche will be released immediately thereafter. The domestic debt will be reduced by repurchasing "ZUNK bonds" (government paper paying below market interest rates provided to banks in exchange for bad debts). The foreign exchange reserves will soon be increased by $150 million from the sale of Sodi Devnya. The IMF insists on full price liberalization and budgetary measures for the poor. Premier Stefan Sofiyanski will write the Paris Club of commercial creditors today requesting the rescheduling of $40-50 million due this year. -- Michael Wyzan

TURKS RESCIND EXPULSION ORDER FOR BULGARIAN TURKS.
The Turkish government has rescinded an order to expel thousands of Bulgarian Turks who do not have the proper documentation to reside in Turkey, Reuters reported on 25 February. The order became public knowledge last week. Defense Minister Turhan Tayan told the parliament that "nobody will be sent abroad and citizenship rights will be given." The expulsion order was opposed by both opposition and nationalist parties as well as Turkey's sizable Balkan emigre community. -- Lowell Bezanis

[As of 1200 CET]

Compiled by Susan Caskie and Jan Cleave




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