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Newsline - December 15, 1997




YELTSIN SEEKS TO CALM FEARS OVER HEALTH

President Boris Yeltsin acknowledged on 14 December that he does not feel well but assured Russians that his health does not give cause for concern. In televised remarks made while casting his ballot in Moscow city elections, Yeltsin said he is doing at least four hours of paperwork a day and is keeping abreast of events. Owing to below- freezing temperatures, Yeltsin voted from inside the Barvikha clinic. Kremlin officials gave no additional information on the president's health on 15 December. Reuters quoted a spokesman as saying, "People could see the president on television last night, so they could see things were fine. Nothing has changed since yesterday." On 12 December, spokesman Sergei Yastrzhembskii denied an Ekho Moskvy report saying Yeltsin was hospitalized on 10 December with a "brain spasm" brought on by exhaustion and sudden temperature changes, rather than with a respiratory infection. LB

CHUBAIS UPBEAT ON RUSSIAN MARKETS

First Deputy Prime Minister Anatolii Chubais told journalists on 15 December that Russia has overcome the worst of the crisis that shook the country's financial markets in recent weeks, RFE/RL's Moscow bureau reported. Chubais argued that purchases of foreign exchange, which threatened to cause a significant devaluation of the ruble, have declined significantly, saying that "last week the central bank was not selling but buying foreign currency on the markets." He confirmed that the government is not seeking additional loans from abroad, an apparent reference to the $2 billion credit Russian officials were reportedly negotiating with four Western banks (see "RFE/RL Newsline," 11 December 1997). Chubais also said Russian corporate shares are undervalued and predicted that they will appreciate in the future. Reuters quoted Chubais as saying that despite the financial crisis, the government target of 2 percent economic growth for 1998 may still be met. LB

IMF EXPERTS TO RECOMMEND RELEASING LOAN

An IMF review team in Moscow on 12 December issued a statement saying they will recommend that the fund's board release a $700 million quarterly tranche of a three-year $10.1 billion loan to Russia. IMF officials in Washington told an RFE/RL correspondent that the board may consider the tranche as early as the first week in January. The IMF delayed the tranche in late October, saying poor tax collection had prevented the fund's experts from completing a quarterly review of the Russian economy (see "RFE/RL Newsline," 3 November 1997). But the 12 December statement said Russian authorities have "clearly confronted" their problems in tax collection and spending. According to ITAR-TASS, the statement added that Russia has good economic prospects for 1998, "provided that the fiscal and monetary policies agreed during the review are fully applied on a sustained basis." LB

PRO-LUZHKOV CANDIDATES WIN MAJORITY IN MOSCOW DUMA...

The Moscow City Duma will continue to be consistently loyal to Mayor Yurii Luzhkov following the 14 December elections, RFE/RL's Moscow bureau reported. Winners of 27 out of the 35 seats in the Duma had been endorsed in a "mayor's list" published in various local newspapers. Yet another seat was claimed by an adviser to the city administration. Of the successful pro-Luzhkov candidates, 19 campaigned with no political party affiliation and eight represented either Yegor Gaidar's party Russia's Democratic Choice (DVR) or Grigorii Yavlinskii's Yabloko movement. Yabloko, the DVR, and the pro-government Our Home Is Russia (NDR) movement agreed not to compete against one another in 13 districts and won in 11 of them (seven for the DVR, three for Yabloko, and one for the NDR). Officials blamed extremely cold weather for the low turnout of just 29 percent, ITAR- TASS reported. LB

...WHILE MAYOR'S OPPONENTS WIPED OUT

Although electoral legislation bars the mayor from active participation in the campaign for the city Duma, Luzhkov appealed to Muscovites not to vote for his most vocal critics, State Duma deputy Nikolai Gonchar and DVR member Arkadii Murashev, RFE/RL's Moscow bureau reported on 15 December. Media outlets that support Luzhkov published information discrediting both Gonchar and Murashev during the campaign, and both lost their districts. Not a single candidate aligned with Gonchar won a seat, although Gonchar's bloc had been expected to put up a strong showing. Some Russian commentators had even touted him as a strong potential challenger to Luzhkov in the next mayoral election. The Communist-backed movement My Moscow also failed to win any seats in the Moscow City Duma. LB

COMMUNISTS DO WELL IN STAVROPOL

Communist candidates won 11 out of 25 seats in the Stavropol Krai Duma in 14 December elections, ITAR-TASS reported. They are likely to be able to elect their choice as Duma speaker. (Like regional governors and republican presidents, heads of regional legislatures automatically become members of the Federation Council, the upper house of the parliament.) Communist candidates have traditionally done well in Stavropol. Aleksandr Chernogorov easily won a gubernatorial election in November 1996, and Communist- backed candidates won two by-elections for State Duma seats from the krai earlier this year. Meanwhile, police Colonel Nikolai Lyashenko won the 14 December mayoral election in Stavropol's city of Budennovsk. Lyashenko was chief of police when Chechen fighters seized more than 1,000 hostages in Budennovsk in June 1995. He was sacked shortly thereafter, but a subsequent investigation praised his professionalism during the hostage crisis. LB

POLITICIANS ADVOCATE AMENDMENTS ON CONSTITUTION DAY

Communist Party leader Gennadii Zyuganov, who has long called for amendments to reduce the president's powers, says the current constitution is "ineffective and dying" and fails to provide a balance of power between the legislative and executive branches. Speaking to Interfax on 12 December, the national holiday marking the controversial 1993 referendum through which Russia adopted its constitution, Zyuganov charged that the document "does not guarantee in practice a single right it declares." Yabloko faction leader Grigorii Yavlinskii argued that constitutional amendments should increase parliamentary and judicial powers. Noting that such amendments would affect not the incumbent but rather subsequent presidents, Yavlinskii called on Yeltsin to take a constructive attitude toward constitutional changes. In an interview with Ekho Moskvy, Yavlinskii also argued that "the concentration of power in the hands of one man means that the state authorities become very weak." LB

NEMTSOV SUPPORTS CHILEAN ECONOMIC MODEL

Speaking in Venezuela on the last day of his tour to Mexico and Latin America, First Deputy Prime Minister Boris Nemtsov advocated the Chilean variant of economic reform for Russia, an RFE/RL correspondent in Caracas reported on 12 December. Nemtsov argued that having implemented liberal economic policies, Chile has achieved 10 years of strong economic growth, a stable currency, and a good level of social protection for its population while not being burdened with a budget deficit. He added that "the Chilean economy does not depend on American capital [investment]. That experience is important for Russia. We cannot count on attracting a large quantity of American money now, for both political and economic reasons." Back in Moscow on 14 December, Nemtsov told ITAR-TASS that the Russian government is trying to implement "democratic people's capitalism," which he argued is far better than "oligarchic" capitalism. LB

KULIKOV WANTS WARRING FINANCIAL GROUPS TO RECONCILE

Interior Minister Anatolii Kulikov has called on leading Russian financial and industrial groups to reconcile their differences, perhaps by creating a "supreme economic council of bankers and entrepreneurs," ITAR-TASS reported on 13 December. Kulikov said members of such a council could have the status of presidential financial advisers. He warned that conflicts between financial and industrial groups could undermine Russia's political and economic system and could threaten the foundations of Russian statehood. LB

OMSK GOVERNOR AGAINST SEIZURE OF OIL REFINERY

Appearing on local television in Omsk, Governor Leonid Polezhaev has criticized the recent decision of a government commission to seize and sell property of the Omsk Oil Refinery in order to cover tax debts, ITAR-TASS reported on 12 December. Polezhaev proposed settling the refinery's debts of some 500 billion rubles ($84 million) to the federal government through offsets. Noting that the center owes some 300 billion rubles to the Omsk regional utility, which in turn owes the same amount to the refinery, he argued that a series of offsets would resolve the problem. A recent presidential decree banned the practice of canceling tax arrears against other debts owed to enterprises that fail to make tax payments (see "RFE/RL Newsline," 10 November and 10 December 1997). LB

AIR FORCE COMMANDER SUSPENDS FLIGHTS

Petr Deinekin on 12 December ordered that all Air Force flights be halted for one week pending an investigation into the previous day's collision of a military plane with a civilian helicopter, Russian news agencies reported. Deinekin's order does not apply to aircraft either on "combat duty" or subordinate to the air defense troops or to the navy. Deinekin recently requested to be transferred to the reserves (see "RFE/RL Newsline," 12 December 1997). That move was officially prompted by Deinekin's reaching the retirement age of 60, but it is widely believed to be linked to the recent crash in Irkutsk of a military cargo plane. Appearing on Russian Public Television on 13 December, Deinekin denied media speculation that a poor mixture of fuel caused that crash. A government commission is investigating why three of the plane's four engines malfunctioned shortly after takeoff. LB



ARMENIAN COURT SENTENCES OPPOSITION ACTIVISTS

The Supreme Court on 12 December concluded handing down prison sentences in the trial of 31 members and supporters of the opposition Dashnak party (HHD), which was suspended by President Levon Ter-Petrossyan in December 1994. The defendants were arrested in July 1995 and brought to trial in March 1996 on charges of publicly calling for the overthrow of the Armenian government. Initial charges of plotting a coup, terrorism, and high treason were dropped because of lack of evidence. The key defendant, Vahan Hovanissian, received a four-year prison sentence. The court found four other defendants guilty of the murder of two policemen during their arrest and handed down a death sentence to one of them (see "End Note" below). LF

ARMENIAN INDEPENDENT UNION HOLDS FOUNDING CONGRESS

At its founding congress in Yerevan on 12 December, the Federation of Independent Labor Unions (AAMD) announced that its objectives are to create new jobs, protect workers' rights, and promote private pension funds, RFE/RL's Yerevan bureau reported. The AAMD will represent the interests of workers from various sectors of the economy, including some journalists and other workers in the mass media. It harshly criticized the official Confederation of Labor Unions of Armenia for what it considers too close ties with the government and disregard of workers' rights. In a statement published in "Azg" on 11 December, the confederation accused the government of preventing it from protecting workers' rights. It also harshly criticized the cabinet's new draft law on social insurance. LF

GEORGIAN PIPELINE TO BE COMPLETED BY OCTOBER 1998

The 388.5 kilometer pipeline carrying early oil from the Caspian basin across Georgia will be completed by October 1998, officials at the Georgian International Oil Corporation told ITAR-TASS on 13 December. PG

THREE CENTRAL ASIAN PRESIDENTS MEET

Askar Akayev and Islam Karimov, the presidents of Kyrgyzstan and Uzbekistan met with their Kazakh counterpart, Nursultan Nazarbayev, in the new Kazakh capital, Akmola, on 12 December, RFE/RL correspondents and ITAR-TASS reported. The leaders of the three countries that compose the Central Asian Union signed a protocol establishing three international consortia for energy and water resources, food production, and minerals and raw materials. At the same time, they expressed dissatisfaction that trade between their countries is down on 1996 levels. BP

TURAJONZODA TO RETURN TO TAJIKISTAN

Ali Akbar Turajonzoda, formerly the head Muslim cleric of Tajikistan and currently the deputy leader of the United Tajik Opposition (UTO), is expected to return to Tajikistan soon, RFE/RL correspondents reported on 15 December. Turajonzoda, who remained in Tehran despite the fact that UTO leader Said Abdullo Nuri returned to Dushanbe in September, has been expected to receive a post in the new coalition government. In meetings with Tajik President Imomali Rakhmonov and Nuri on the sidelines of the recent Organization of the Islamic Conference session in Tehran, Turajonzoda was offered and accepted the post of first deputy prime minister. Turajonzoda is reportedly waiting for the official announcement of his new appointment before returning. BP

SHAKE-UP WITHIN TAJIK PARLIAMENT

At a 13 December session of the parliament, President Rakhmonov received the legislature's approval to remove eight deputies from their posts and bring charges against them, RFE/RL correspondents and ITAR-TASS reported. All those sacked allegedly were linked to attempts to overthrow the government. Among them was Yakub Salimov, the former chairman of the Customs Committee who is wanted for his role in attacks on government forces led by mutineer Colonel Mahmud Khudaberdiyev in 1996-1997. Rakhmonov told the parliament that if all lawmakers were subject to "intensive" investigation, "half of the seats in the deputies' hall would be empty." BP

NAZARBAYEV SUPPORTS USE OF RUSSIAN LANGUAGE

President Nazarbayev on 13 December said that the citizens of Kazakhstan should continue studying and using both Russian and Kazakh, ITAR-TASS reported. Nazarbayev said he favored "careful introduction" of Kazakh as the state language. He added by the year 2030, Kazakhstan will be "one of the Eurasian centers" and therefore knowledge not only of Kazakh and Russian but also of English will be important. BP




EU LEADERS AGREE ON ENLARGEMENT

The leaders of the EU agreed in Luxembourg on 13 December that entry negotiations with the Czech Republic, Estonia, Hungary, Poland, Slovenia, and Cyprus will begin in spring 1998. They also agreed that Bulgaria, Latvia, Lithuania, Romania, and Slovakia, though not invited to start formal negotiations, will be included in the overall enlargement process. The union has promised that they can move to the "fast track" for prospective new members if they make sufficient progress in economic and political reform. MS

RESPONSES FROM THOSE LEFT OUT OF FAST TRACK...

Slovak Prime Minister Vladimir Meciar told journalists that Bratislava was "pleased" with the EU decision but wanted to be included in the "fast track" category, saying his country has made "more progress" than some of those included in that category. Bulgarian President Petar Stoyanov said his country is encouraged but should aim not simply to join the EU but to create a stable democracy. Romanian Foreign Minister Adrian Severin argued that the decision provided a "fantastic opportunity for European unification." Latvian Prime Minister Guntars Krasts noted it was the "best formula" for the start of the enlargement process that "Latvia had hoped for." Meanwhile, Lithuanian Premier Gediminas Vagnorius's spokesman said that while the decision did "not quite satisfy" Vilnius, the premier nonetheless believes that Lithuanian efforts toward EU membership have paid off because "Lithuania will begin the process of accession to the organization next year." MS/JC

...AND FROM SOME OF THOSE INCLUDED

Polish Premier Jerzy Buzek stressed Poland will be cooperating with those countries negotiating EU membership at a slower pace. Czech President Vaclav Havel said Europe has a unique opportunity to organize itself on the basis of "equal justice" and change the previous practice of the powerful states dictating to the less influential ones. Hungarian Premier Gyula Horn argued there is a "qualitative difference" in the way the two groups were handled and predicted that Hungary may join the EU between 2000 and 2002. MS

ESTONIA WELCOMES DECISION ON BALTIC NEIGHBORS

In an official statement released on 13 December, Tallinn said it attaches particular importance to the inclusion of Latvia and Lithuania in the overall EU enlargement process, RFE/RL's Estonian service reported. It also stressed the importance of further strengthening and developing relations with those two countries, which it described as its closest neighbors. JC

SLOVENIA, ESTONIA HOPE TO SIMULTANEOUSLY JOIN EU, EMU

Prime Minister Janez Drnovsek said at the Luxembourg summit on 13 December that Slovenia already meets the fiscal criteria for joining the European Monetary Union and that 70 percent of its trade is with the EU. Similarly, Estonian Foreign Minister Toomas Hendrik Ilves commented that Tallinn will be ready for the EMU by the time it joins the union, ETA reported. According to Ilves, Estonia already meets "nearly all criteria" for joining the EMU, except the one on inflation. The government currently estimates annual inflation in 1997 at 11.8 percent. PM/JC

UKRAINIAN GOVERNMENT PROPOSES TIGHTER AUSTERITY BUDGET

Faced with the prospect that Kyiv will be unable to finance any deficit by borrowing abroad, Finance Minister Igor Mityukov said on 12 December that the government will propose a new budget with a deficit of only 3.5 percent of GDP rather than 4.3 percent as envisaged in the draft budget approved by the parliament in the first reading, ITAR-TASS reported. Given Socialist opposition to the first draft, this second even tighter proposal is likely to exacerbate tensions between the parliament and the government. PG

UKRAINE, RUSSIA TO DROP VAT IN 1998

Following a meeting 12 December in Moscow, Russian First Deputy Prime Minister Anatolii Chubais and his Ukrainian counterpart, Serhiy Tyhypko, announced that the two countries will sign an agreement on 28 February 1998 ending the practice of levying value-added tax on goods exported to the other country, ITAR-TASS reported. But the two leaders failed to reach agreement on sugar quotas, according to the Russian news agency. Meanwhile, Ukrainian Prime Minister Valeriy Pustovoitenko said in Donetsk that Kyiv has approved a Donets development plan for the years 1998-2000. But both the estimated high costs of the plan and the absence of key Ukrainian officials raise doubts that the project will be implemented. PG

CRITICISM OF BELARUSIAN PRESS CRACKDOWN CONTINUES

Some 1,000 people demonstrated in Minsk on 14 December against President Alyaksandr Lukashenka's decision to close the main opposition newspaper, "Svaboda," RFE/RL's Belarusian Service reported. The same day, Stephen Sestanovich, special adviser to U.S. Secretary of State Madeleine Albright on the Newly Independent States, said after meetings in Minsk with Belarusian officials that countries failing to respect freedom of the press cannot expect to be treated in the same way as those that show respect. Two days earlier, the press and information ministers of the Council of Europe denounced the closure of "Svaboda." The Russian delegation, however, refused to back the resolution, ITAR-TASS reported. PG

RUSSIAN OFFICIAL SAYS KALININGRAD IS NOT "FOURTH BALTIC REPUBLIC"

Russian Foreign Ministry official Artur Kuznetsov has expressed surprise at Lithuanian parliamentary deputy speaker Romualdas Ozolas's recent statement that Kaliningrad Oblast is the "fourth Baltic republic." Kuznetsov told ITAR-TASS on 13 December that the statement was "unexpected, unprovoked, and illogical" and, moreover, "surprising" since relations between Kaliningrad and Lithuania, like those between that country and Russia as a whole, have "never been better." Ozolas made the statement during an unofficial trip to Kaliningrad to participate in celebrations marking the 450th anniversary of the first book to be published in Lithuanian. JC

SOLIDARITY-BACKED GROUP SEEKS TO BUY POLISH SHIPYARD

A group of Polish banks and foundations, including one linked to the Solidarity movement, is seeking to buy the Gdansk shipyards, PAP reported on 12 December. The movement began in those shipyards, which the former government declared bankrupt in August 1996. Some Gdansk officials are reportedly concerned that the group will be unable to find the money to take over the yards and will scare off foreign investors in the meantime. PG

POLAND MAY PRODUCE RUSSIAN FIGHTER

Russian defense industry officials told ITAR-TASS on 12 December that Poland may produce the SU-39 subsonic attack fighter under a licensing agreement. The deal reportedly is worth some $2 billion. PG

KLAUS RE-ELECTED PARTY CHAIRMAN

An extraordinary congress of the Civic Democratic Party (ODS) at Podebrady on 13-14 December re-elected outgoing Prime Minister Vaclav Klaus as ODS chairman, CTK reported. Klaus, who defeated Jan Ruml by 227 votes to 72, said the ODS executive will decide whether the party will seek to join a new government. He did not say, however, when that decision will be made. On arriving in Podebrady, Ruml said that a separate wing may emerge after the congress but that he would not like to see the ODS split. In other news, the Chamber of Deputies on 12 December approved the 1998 budget by a vote of 101 to 99. MS

HAVEL TO APPOINT NEW GOVERNMENT

At a 12 December conference with Christian Democratic Party leader Josef Lux, President Vaclav Havel said he will appoint a new government this week, CTK reported. Havel said Lux's proposals for the new cabinet are "realistic" and that the new government will have fewer ministers and an approximately equal number of non-party and party- affiliated members. He also said more women will be represented in the cabinet than in any Czech government since the collapse of communism. Lux said the government will have to "prepare the privatization projects" of three partly state-owned banks and to consider "modifying the constitution" to allow the parliament to call for its own dissolution if a stable coalition cannot be formed, AFP reported. MS

SLOVAK PRESIDENT PARDONS SON

Michal Kovac on 12 December ordered that the prosecution of all people involved in the "Technopol case," including his son, be halted. The president explained that in the five years since investigations began, the authorities have failed to gather evidence that would make it possible to bring the case to trial, CTK reported. In an interview with Bratislava's Radio Twist, Michal Kovac Jr. commented that he had no choice but to accept the presidential pardon. MS

HUNGARIAN PARTIES PREPARE FOR 1998 ELECTIONS

The National Board of the Hungarian Democratic Forum (MDF) on 13 December approved an election cooperation agreement with the Young Democrats (FIDESZ), The same day, FIDESZ named its candidates for ministerial posts in case of an electoral victory. Ivan Szabo, the chairman of the Hungarian Democratic People's Party (MDNP), told the media on 13 December that his party hopes to have a "stable and strong" parliamentary faction of 20-25 members following the spring 1998 elections. MSZ




ROW OVER YUGOSLAV CITIZENSHIP FOR BOSNIAN SERBS

Yugoslav Foreign Minister Milan Milutinovic and Momcilo Krajisnik, the Serbian member of the Bosnian joint presidency, signed an agreement on dual citizenship in Belgrade on 13 December. The pact allows Bosnian citizens to hold Yugoslav citizenship as well. In Sarajevo, however, an adviser to Alija Izetbegovic, the Muslim member of the joint presidency, told an RFE/RL correspondent that no agreement on dual citizenship can be legally binding until Sarajevo and Belgrade establish diplomatic relations. Hanns-Heinrich Schumacher, a deputy to High Representative Carlos Westendorp, said on 14 December that the Milutinovic-Krajisnik document is invalid because Krajisnik has no authority to sign international agreements on behalf of Bosnia. Krajisnik said in Pale the previous day that the Serbs in the joint Bosnian parliament will not agree to the proposed law on Bosnian citizenship unless the measure takes into account his agreement with Milutinovic. PM

HAGUE'S ARBOUR SLAMS FRENCH

Louise Arbour, the chief prosecutor at the Hague-based International Criminal Tribunal for the Former Yugoslavia, told "Le Monde" of 13 December that France is deliberately hampering the court's work. She also charged that most indicted war criminals live openly in areas of Bosnia under French SFOR control. Arbour objected to Paris's recently announced policy of not allowing French officers and soldiers to testify in person before the court but to communicate with that body only in writing. The French Foreign Ministry, for its part, denied that Paris is obstructing the court's work and pointed out that France has long been active in peacekeeping in the former Yugoslavia. PM

BOSNIAN CROATS PROTEST TO TUDJMAN

Preporod, the leading Bosnian Croat cultural society, sent a letter from Sarajevo to Croatian President Franjo Tudjman on 12 December to protest what it called the growing number of arrests and deportations from Croatia of Bosnian Muslim miners. The letter said that many of the Muslims have lived in Croatia for 20 years but have not yet been able to clarify their legal status, an RFE/RL correspondent reported from Zagreb. The Croatian Interior Ministry replied in a statement that it will examine each of the Muslims' cases individually and rule on them according to the law. PM

CROATIAN CONSTITUTIONAL CHANGES ANGER SLOVENIA

The lower house of parliament on 12 December passed a package of constitutional amendments that Tudjman proposed in November (see "RFE/RL Newsline," 11 December 1997). But the final version of the law names some 10 ethnic minorities, which Tudjman's proposal did not. Slovenes, however, are not included among those named. In Ljubljana, Deputy Prime Minister Marjan Podobnik on 13 December called the exclusion of the Slovenian minority unexpected and disturbing, an RFE/RL correspondent reported. Podobnik said Zagreb's move will prompt Ljubljana to reconsider its support for Croatian membership in European bodies. On 12 December, Slovenian Prime Minister Janez Drnovsek led a delegation to Zagreb to sign a free trade agreement. It is Croatia's first such pact with a member of the Central European Free Trade Association and its first step toward membership in that body. PM

SLOVENIA NOT TO BAR EX-COMMUNISTS

The parliament voted by 57 to 22 on 12 December to defeat an opposition-backed measure to bar former Communists from public office. The measure was aimed at President Milan Kucan and at Premier Drnovsek. PM

NEW REGIME IN FORCE ON CROATIAN-SERBIAN FRONTIER

As of 14 December, residents of eastern Slavonia require a Croatian passport with a Yugoslav visa or a special border pass to enter Serbia. Previously, the mainly Serbian population could cross the frontier with only an identity card. The Croatian police have recently issued some 4,000 special border passes. PM

PRISTINA STUDENTS DEMAND POLITICAL UNITY

Representatives of some 900 students at the underground Albanian-language University of Pristina have presented a petition to the leaders of the eight main Kosovar political parties, an RFE/RL correspondent reported from Pristina on 12 December. The students demanded that the parties sink their differences and unite as a first step toward promoting the broad unity of all Kosovars. PM

ALBANIAN GOVERNMENT TO CUT 15,000 STATE JOBS...

Prime Minister Fatos Nano said after a meeting with IMF representatives in Tirana on 13 December that his government wants to raise public sector wages by 20 percent but also cut 15,000 jobs in that sector next year The government also hopes to help create 73,000 new jobs in the private sector. Of the 267,000 people currently employed by the government, some150,000 work in the government administration. Albania has 162,000 registered unemployed, while another 155,000 families receive welfare payments. The average monthly salary in the state sector is $55, according to "Gazeta Shqiptare." FS

...BUT EXPECTS ECONOMIC STABILIZATION

Also on 13 December, spokesman Ben Blushi said that the government expects to reduce inflation from 40 percent in 1997 to 20 percent the following year. It also hopes to increase GDP growth from 7.5 percent to about 10 percent. By consolidating and streamlining the collection of taxes and customs duties, the government expects to reduce the budget deficit to $170 million, down from $333 million in 1997. Blushi added that customs revenues have increased from $10 million last year to $28 million for the period September-10 December 1997 alone, partly owing to higher tariffs. FS

BERISHA ACCUSED OF SMUGGLING

Former Finance Minister Genc Ruli told "Koha Jone" of 13 December that former President Sali Berisha ran smuggling operations from 1992 to 1997. Ruli added that the secret service (SHIK) was at the center of smuggling activities across Albania. Ruli claims that Berisha appointed SHIK officers as heads of the customs and tax police, adding that he "institutionalized smuggling in [the hands] of SHIK and a gang linked to it." In 1995, Berisha accused Ruli of involvement in smuggling, but the parliament refused to lift his immunity so that he could be prosecuted. The following year, Berisha purged Ruli and party leader Eduard Selami from the Democratic Party. FS

HUNGARIAN ALLIANCE TO REMAIN IN ROMANIAN GOVERNMENT

The Council of Representatives of the Hungarian Democratic Federation of Romania (UDMR) on 14 December decided against leaving the cabinet, an RFE/RL correspondent in Cluj reported. UDMR chairman Bela Marko said the decision is conditional on the implementation of agreements reached by the Hungarian formation and the other coalition partners. The UDMR has also said that the continuation of its participation in the governing coalition is conditional on a "firm decision" by its members to "put an end to the nationalist anti-Hungarian campaign that has been on going as of late." The UDMR "cannot be a member of a coalition that tolerates exacerbating nationalism and shrinking the rights of national minorities." Finally, the UDMR has demanded that George Pruteanu, the chairman of the Senate's Education Commission, be replaced. MS

ROMANIAN PRESIDENT ON RELATIONS WITH RUSSIA

Emil Constantinescu says Romania "acknowledges Russia's great power status and respects Russia's interests." In an interview with "Pravda" cited by Mediafax on 14 December, Constantinescu said that Russia's interests "do not contravene" those of Romania and that the reason for Bucharest's quest to join Euro-Atlantic structures is "not a threat coming from Russia.". He said developing good bilateral relations with Moscow continues to be a "fundamental component" of Romanian foreign policy. MS

ROMANIAN CIVIC MOVEMENT SUES FORMER PRESIDENT

The Civic Alliance movement on 12 December announced it is suing former President Ion Iliescu, RFE/RL's Bucharest bureau reported. Alliance chairwoman Ana Blandiana said the movement will ask the parliament to lift Iliescu's immunity. The decision follows Iliescu's testimony at the trial of miners' leader Miron Cozma. Iliescu had said that, in September 1991, the alliance asked the miners to return to the center of Bucharest from the railway station, where they had gathered in order to leave the capital (see also "RFE/RL Newsline," 12 December 1997). Meanwhile, Iliescu on 12 December said his Party of Social Democracy in Romania may initiate the process of "presidential suspension" if President Constantinescu continues to "infringe on the principle of the separation of powers." MS

TIRASPOL SAYS ROMANIA WANTS ANNEXATION OF MOLDOVA

Separatist Foreign Minister Valerii Litskay says the "danger" of a Romanian annexation of Moldova is still not over. In an interview with Tiraspol television on 12 December, Litskay said it is "alarming" that Romania, which he claimed "will join NATO in the next five years," has not yet signed a basic treaty with Moldova but has signed such treaties with Hungary and Ukraine, BASA-press reported. Tiraspol Supreme Soviet chairman Grigorii Marakutsa told journalists in Tiraspol the next day that the separatists oppose the State Duma's ratification of the Moldovan- Russian treaty because the document makes no mention of its "political and economic prerogatives." He said a new treaty must be worked out and that Transdniester will demand Moldova accept full integration into CIS political and military structures, join the Russia-Belarus union,. and renounce "unification" with Georgia, Ukraine, and Azerbaijan. MS

MOLDOVAN PRESIDENT ON EU ASSOCIATE MEMBERSHIP

Petru Lucinschi has sent letters to EU leaders requesting their support for starting negotiations on Moldovan associate membership, RFE/RL's Chisinau bureau reported on 12 December. Lucinschi wrote that Moldova hopes to eventually become a full member of the union but realizes that this is a "complicated and lengthy process." He noted that the application for associate membership is proof that Moldova has "firmly stepped on the path of full integration into Europe." MS

BULGARIAN PARLIAMENT APPROVES NEXT YEAR'S BUDGET

Lawmakers on 12 December approved the 1998 budget by a vote of 120 to 52 with four abstentions, RFE/RL's Sofia bureau reported. The budget envisages a deficit of 610 billion leva ($343 million) or 2.7 percent of GDP. Annual inflation is projected at 16.4 percent. MS




FATE OF ARMENIA'S DASHNAKS UNCERTAIN AFTER CLOSE OF TRIAL


by Emil Danielyan

The end of the trial of 31 members and supporters of the banned Dashnak party (HHD) has led to further uncertainty about prospects for the party's reinstatement. On 12 December, the popular and prominent Dashnak leader Vahan Hovannisian was sentenced to four years in prison, having been found guilty of calling for the "violent overthrow of the government." Armenia's Supreme Court also found four defendants guilty of murdering two policemen during their arrest. It handed down a death sentence to one of the four and prison terms ranging between two-and-a-half and seven years to 18 other defendants.

All the defendants pleaded not guilty to the charges, and Hovannisian described the trial as the "political punishment" of his party. Most of the defendants withdrew the pre-trial "confessions" they had made shortly after court proceedings were launched in March 1996, saying those confessions were extracted by torture and psychological pressure. The opposition and human rights groups in Armenia have repeatedly condemned the "case of the 31" as politically motivated, citing what they consider to be breaches of the due process of law.

Article 65 of the criminal code, which envisages punishment for an "organized group" that makes "public calls" to topple the government, leaves significant room for interpretation. Hovannisian's lawyer argued that his client simply expressed his political convictions during "private conversations." According to the attorney, the 31 defendants cannot be considered an organized group because most of them did not know one another before their arrest.

Without discounting the fate of the dozens of defendants involved, it can be said that the trial's significance lies in its implications for the Dashnak party and for Armenian politics in general. The 12 December verdict may either pave the way for the HHD's re- legalization or put that process on hold for another few years.

Neither this latest trial nor the previous Dashnak- related trial (the so-called "Dro trial") have found any link between the HHD and the alleged conspirators and terrorists. Hovannisian and the 30 other defendants were arrested in July and August 1995 on charges of plotting a coup that would have involved the assassination of Armenia's power ministers. At the time, the government of President Levon Ter-Petrossyan announced it had foiled a major Dashnak conspiracy.

Later, the state prosecutors dropped the coup charges, replacing them with accusations of having called for the overthrow of the government. They were unable to prove that the 31 were members of an organized group. Eleven defendants were set free during the trial for lack of evidence. As for other defendants, the court was unable to establish any links between them and the murder of the two policemen, for which Tigran Avetisian received the death penalty.

The trial of the 31 thus followed the pattern of the Dro trial, with the authorities implicating the leaders of the Dashnak party and the court unable to establish a connection. In fact, it was the accusations of harboring the clandestine subversive group called Dro that resulted in the ban on the HHD in December 1994. Now that the Dashnak leadership has been cleared of criminal charges, there seems no major obstacle to its re-legalization.

But it is noteworthy that Hovannisian, who has already been in jail for some two-and-a-half years, will not complete his term until after the next parliamentary elections, slated for July 1999. This may suggest that the authorities do not want either him or his party participating in the vote. Under Hovannisian's leadership, the Dashnaks would present a strong challenge to Ter- Petrossyan's party. The authorities are becoming increasingly reluctant to carry out political reform. Moreover, their closed-door dialogue with the Dashnaks, which began in April, is unlikely to prove successful as long as Hovannisian is in jail.

However, there is a facing-saving option for the authorities and the HHD: namely, to pardon Hovannisian by presidential decree, as has been urged by the country's leading intellectuals and prominent public figures, including supporters of the government. It is thought that such an option would promote "national unity" ahead of possible international pressure on Armenia to recognize Azerbaijan's territorial integrity in the Nagorno-Karabakh conflict.

With their strong branches in the Diaspora (and in the U.S. in particular), the Dashnaks may be able to help the Armenian government avoid international isolation. Indeed, they have recently hinted about a possible meeting with Ter-Petrossyan in the near future. If such a meeting does take place, it would doubtless play an major role in determining the fate of Armenia's oldest party. The author contributes regularly to RFE/RL.


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