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Newsline - December 19, 1997




CONFUSION SURROUNDS YELTSIN'S HEALTH

President Boris Yeltsin on 19 December visited a Moscow Cardiological Center for a routine checkup, but accreditation for a briefing on the results of that examination was limited to just a few journalists, AFP reported. Interfax on 19 December quoted Yurii Yarov, deputy head of the presidential administration, as saying Yeltsin may need another week in the Barvikha sanatorium, where he has been treated since 10 December. However, the news agency withdrew that report and later quoted Yarov as saying Yeltsin may leave Barvikha at any time. Yeltsin said on 18 December that he was ready to leave the clinic the following day, but his spokesman, Sergei Yastrzhembskii, told journalists later that the president will stay in the clinic until he has spent 10 to 12 days there. Kremlin officials continue to insist that the president is suffering from an ordinary respiratory infection. LB

PRIMAKOV OUTLINES RUSSIA'S VISION OF OSCE

Foreign Minister Yevgenii Primakov argued at the meeting of foreign ministers of the Organization on Security and Cooperation in Europe in Copenhagen on 18 December that only an organization including all European states, such as the OSCE, can play the central coordinating role in ensuring European security. Primakov argued that NATO cannot do so, since not all European countries are alliance members. Primakov also rejected the proposal, backed by the U.S. and Germany, that the OSCE adopt the principle of "consensus minus one" in decision-making in order to preclude one of its 54 members imposing a veto. He said the "consensus-minus-one" principle would hinder a settlement of the Karabakh and Abkhaz conflicts, Interfax reported. He affirmed that Russia would welcome a greater OSCE role in mediating CIS conflicts. The OSCE charter currently under discussion should not empower the organization to interfere in the domestic affairs of member states, Primakov argued. LF

SELEZNEV WARNS CLINTON AGAINST 'PRESSURING' DUMA

State Duma Speaker Gennadii Seleznev on 18 December warned U.S. President Bill Clinton not to try to "pressure" the Duma to ratify the START-2 arms control treaty, Russian news agencies reported. U.S. and Russian officials have recently said that Clinton and Yeltsin have agreed that the U.S. president will not come to Russia in 1998 until after START-2 has been ratified. Seleznev said a date for consideration of the treaty by the lower house of the parliament "may never be set" if Clinton seeks to "impose terms" on the Duma. LB

DUMA CONDEMNS YELTSIN'S STATEMENTS IN STOCKHOLM

Also on 18 December, the Duma passed a resolution condemning statements made by Yeltsin in Stockholm as "irresponsible" and "inconsistent with Russian laws." While in Sweden, Yeltsin said Russia would unilaterally reduce its nuclear stockpile and cut its troops in northwestern Russia by 40 percent. Other officials confirmed Yeltsin's statement on the troop reductions but clarified his remarks on the nuclear arsenal, saying the president was only talking about making reductions "in parity" with U.S. disarmament. Presidential spokesman Yastrzhembskii on 18 December accused some Duma deputies of distorting the meaning of Yeltsin's statements. LB

YELTSIN SAYS TAX COLLECTION COMMISSION MUST RESPECT LAWS

Aleksandr Livshits, presidential economic adviser and deputy head of the presidential administration, announced on 18 December that Yeltsin has instructed Prime Minister Viktor Chernomyrdin to make sure decisions of the government emergency commission on tax and budgetary discipline comply with Russian laws, ITAR-TASS reported. In particular, Yeltsin told Chernomyrdin to bring decisions adopted by that commission on 8 December into line with the law. First Deputy Prime Minister Anatolii Chubais chaired the 8 December meeting, which approved the seizure and sale of property of two companies in order to pay their tax debts. Chernomyrdin chaired the next meeting of the commission, at which those companies were given more time to pay their tax arrears (see "RFE/RL Newsline," 18 December). LB

ADVISER VIEWS GOVERNMENT LEAKS TO WESTERN INSTITUTIONS

Also on 18 December, Livshits told journalists that information "known to a very limited circle" of Moscow officials has been leaked to western financial institutions, RFE/RL's Moscow bureau reported. He cited recent letters sent to Prime Minister Chernomyrdin by World Bank President James Wolfensohn and IMF Managing Director Michel Camdessus. Livshits said the letters contained details about the implementation of decisions adopted by the government commission on 8 December. Livshits's charge echoes recent allegations in "Nezavisimaya gazeta," which on 18 and 19 December accused IMF and World Bank officials of trying to control Russia's economic policy. "Nezavisimaya gazeta," financed by Boris Berezovskii's LogoVAZ group, has previously accused Chubais of taking instructions from the U.S. Treasury (see "RFE/RL Newsline," 26 September and 18 December 1997). LB

YELTSIN REPLACES REPRESENTATIVES IN GAZPROM...

Yeltsin on 18 December signed a decree replacing several state representatives in the 40 percent state-owned gas monopoly Gazprom, Interfax reported. Yeltsin appointed Fuel and Energy Minister Sergei Kirienko to chair the collegium of state representatives. He also appointed Livshits, Anti-Monopoly Committee head Nataliya Fonareva and Deputy Economics Minister Nikolai Shamraev to the collegium, Yeltsin simultaneously removed First Deputy Prime Minister Boris Nemtsov, Economics Minister Yakov Urinson, and Aleksandr Kazakov from the collegium. Kazakov was dismissed from the presidential administration in November during a scandal over book fees, but previous reports had indicated that he would keep his position on the Gazprom board. LB

...BUT TRUST AGREEMENT WITH GAS MONOPOLY STILL UNSIGNED

Yeltsin's latest decree appears to reflect the rising influence of Chernomyrdin, who has close ties to Gazprom, and the diminishing clout of Nemtsov and Chubais, who pledged earlier this year to restructure state management of "natural monopolies" in the energy and transportation sector. A new trust agreement on management of the government stake in Gazprom still has not been signed, although Yeltsin on 2 December instructed Gazprom head Rem Vyakhirev and Nemtsov to sign it "as soon as possible." Nemtsov on 14 December told ITAR- TASS that the agreement was not signed before his recent visit to Mexico and South America because of an "annoying misunderstanding," which he did not clarify. LB

YELTSIN PRAISES WORK OF SECURITY FORCES

In an 19 December radio address, Yeltsin praised the work of the security forces on the eve of the "day of the employees of Russia's security forces" and the 80th anniversary of the creation of the Cheka, ITAR-TASS reported. Yeltsin said people could proudly remember security work carried out against the Nazis during World War Two and in obtaining information for developing the "fatherland's atomic weapons," which, he argued, "helped prevent a third world war." He also noted that security workers are invaluable in keeping the government informed about modern-day trouble spots and in combating terrorism. Yeltsin assured Russian citizens that security forces would never again act as the "ideological watchdogs of society." BP

COMMISSION VOWS TO TIGHTEN CONTROL OVER MILITARY FUNDING

The government's emergency commission on tax and budgetary discipline on 17 December approved steps intended to tighten control over defense spending, ITAR-TASS reported. Chairing the meeting, Prime Minister Chernomyrdin slammed as "disgraceful" the frequent diversion of funds allocated to pay the salaries of military personnel. Defense Minister Igor Sergeev said the commission approved measures to improve accounting techniques in the military and eventually process all military funding through the treasury system. (Although many government agencies have been ordered to close their accounts in commercial banks, some of those banks are still authorized to handle Defense Ministry funds.) Sergeev said the financial system in the armed forces is to be reorganized "no later than during the first half of 1998." LB

YELTSIN WANTS BETTER MANAGEMENT OF DEFENSE INDUSTRY

Yeltsin on 17 December ordered the government to draft proposals to better manage the defense industry, Russian news agencies reported. Spokesman Yastrzhembskii said Yeltsin's instruction was a response to a recent request by Duma Speaker Seleznev and Federation Council Speaker Yegor Stroev. Seleznev and Stroev favor recreating a special government agency to manage the defense industry (see "RFE/RL Newsline," 10 December 1997). LB

ROKHLIN'S ALTERNATIVE CONCEPT FOR MILITARY REFORM

Duma Defense Committee head Lev Rokhlin said on 17 December that not only has reform in the Russian army over the past five years failed but "its concept has not even been fully developed," according "Sovetskaya Rossiya" of 19 December. Rokhlin said the "Russian armed forces no longer exist as a single military institution" and blamed the inability to reform the army and navy on the "incompetence" of the General Staff and the Defense Ministry. Rokhlin's movement in support of the army has prepared a 40-page document that provides for the "basic transformation of the 14 Russian power structures into a military organization of the state with centralized control." BP

YELTSIN FIRES THREE TOP MILITARY BRASS

Yeltsin issued a decree on 18 December dismissing General Viktor Prudnikov, the commander-in-chief of the Russian Air Defense Forces, who was named chief of staff for coordinating inter-CIS military cooperation at the October CIS summit, Russian media reported. One day earlier, Yeltsin had dismissed Colonel-General Aleksandr Chindarov and Lieutenant-General Viktor Sorokin, the first deputy and a deputy commander of the Airborne Troops, as part of the overall downsizing of the armed forces, ITAR- TASS reported. LF

YELTSIN TAKES ON RUTSKOI AGAIN

Yeltsin on 18 December signed a decree canceling several directives issued this year by Kursk Oblast Governor Aleksandr Rutskoi, ITAR-TASS reported. The decree says the directives, which regulate the metals industry and the transfer of grain outside Kursk, violate various federal laws and articles of the constitution. Rutskoi was Yeltsin's vice president from June 1991 until fall 1993. He was arrested in October 1993 for helping lead attempts to remove Yeltsin from office after the president sought to shut down the Supreme Soviet. He was released under an amnesty passed by the Duma in February 1994 and continued to criticize Yeltsin. However, since being elected governor of Kursk in October 1996, Rutskoi has kept a low profile, mostly eschewing comment on national political issues. LB

RUSSIA WILL PUSH FOR INTEGRATION WITHIN CIS

Yeltsin has sent an unequivocal message to the presidents of other CIS member states outlining proposals for further integration within that body, presidential press spokesman Yastrzhembskii told journalists on 17 December. The letter focuses on issues raised at the CIS summit in Chisinau in October, at which several participants expressed extreme dissatisfaction at relations between member states and at Russia's role. Responses to Yeltsin's letter will be incorporated into his address to the CIS summit scheduled for late January 1998. Also on 17 December, Vladimir Lukin, the chairman of the Duma Foreign Affairs Committee, criticized Russia's CIS policy and its mediation efforts in Abkhazia, Transdniester, and Karabakh as "unsuccessful." But Vyacheslav Igryunov, the deputy chairman of the Duma Committee for Relations with the CIS, told "Nezavisimaya gazeta" of 18 December that the Duma has no clear position on how to strengthen the CIS. LF

INSTITUTE DIRECTOR COMMITS SUICIDE

Yurii Mamatov, the director of the Yaroslavl Institute for Computer Technology of the Russian Academy of Sciences, shot himself on 18 December, ITAR-TASS reported. Friends and relatives said Mamatov had been depressed over a lack of funding that forces his institute to sell equipment and furniture in order to pay staff's salaries. In October 1996, the director of the Federal Nuclear Center in Chelyabinsk Oblast committed suicide, also reportedly over funding shortfalls that left him unable to pay the wages of the center's employees. LB

NEW PROSECUTOR APPOINTED FOR ST. PETERSBURG

The Prosecutor-General's Office has appointed Ivan Sydoruk as acting prosecutor for St. Petersburg, "Kommersant-Daily" reported on 18 December. He replaces Vladimir Yeremenko, whose term of office ran out in May but who continued to serve as acting prosecutor pending the appointment of his successor. Yeremenko has been implicated in various corruption scandals, including alleged misappropriation of some $600,000 allocated to refurbish the building where his office is located. The Prosecutor- General's Office sought to appoint Sydoruk in the summer, but the St. Petersburg legislature refused to confirm his candidacy. "Kommersant-Daily" speculated that the city deputies may oppose Sydoruk because he has recently investigated allegations of law-breaking by legislators. LB



ARMENIAN FOREIGN MINISTER IN COPENHAGEN

Alexander Arzoumanian says that despite the OSCE's long- term involvement in mediating a solution to the Karabakh conflict, a political settlement has been impeded by Azerbaijan's refusal to engage in direct talks with the Karabakh leadership and by the OSCE chairman-in-office's December 1996 statement pre-determining Karabakh's future status within Azerbaijan. Arzoumanian was addressing the meeting of OSCE foreign ministers in Copenhagen on 18 December. He accused Azerbaijan of seeking a military solution to the conflict and of violating its Conventional Forces in Europe commitment by engaging in a military buildup. He also called for the resumption of negotiations for which no preconditions are set and in which Karabakh would have the status of a full party to the conflict. Arzoumanian said a settlement must allow Karabakh "full control over its territory" and provide both security guarantees for Karabakh and a "geographic contour that will end its enclave situation." LF

ABKHAZ TALKS RESUME

The first session of the Coordinating Council on resolving the Abkhaz conflict opened in Sukhumi on 18 December, Russian media reported. The council was created at talks in Geneva in November under the auspices of the UN, and will oversee three bilateral working groups that will address security and economic issues and the repatriation to Abkhazia of ethnic Georgians forced to flee during the 1992-1993 fighting. Vazha Lortkipanidze, Georgia's ambassador to Russia, told journalists on 17 December that Tbilisi wants the commission's decisions to be binding on both parties. Abkhaz President Vladislav Ardzinba told Interfax that UN representative Liviu Bota has ruled out the attendance at the session of Tamaz Nadareishvili, the chairman of the so- called Abkhaz parliament in exile in Tbilisi. LF

RUSSIA MOVES DISPUTED POST ON BORDER WITH GEORGIA

Russian border guards on 17 December finally restored the disputed Verkhnii Lars border post to its original position on the frontier with Georgia, Russian agencies reported. The post had been moved 1,300 meters into Georgian territory in November without the consent of the Georgian government, prompting protests by the Georgian parliament and political organizations. At Russian Deputy Prime Minister Valerii Serov's talks with members of the Georgian leadership in Tbilisi on 9 December, it was decided to move the post back to its original position. LF

GEORGIA SIGNS PROTOCOL WITH GAZPROM

Georgian President Eduard Shevardnadze and Gazprom chairman Rem Vyakhirev met in Tbilisi on18 December and signed a protocol on renewing cooperation, Interfax and Caucasus Press reported. The protocol provides for the resumption of natural gas supplies to Georgia and the export of gas via Georgia to unspecified third countries. It also calls for the creation of a joint-stock company, GruzRosGaz, but there is no agreement so far on division of shares in that company. Vyakhirev told journalists that Russia prefers the planned underwater Black Sea pipeline for exporting gas to Turkey because it is shorter. He said that Bulgarian claims that such a pipeline could pose an ecological hazard are "groundless." LF

ENERGY SHORTAGE IN KYRGYZSTAN

The Kyrgyz Security Council meets on 19 December to discuss the energy shortage in the country, ITAR-TASS reported. In more than half of Kyrgyzstan's regions, electricity is currently cut off for five to six hours during the day, and many households are without any power supplies during the night. Even hospitals, schools, and the Ministry of Defense are often without electricity, according to the news agency. The power company Kyrgyzenergo claims the shortages are due to a 25 percent reduction in the water level at the Tokhtogul hydroelectric reservoir, which is the largest in the country, and the failure of many people to pay their electricity bills. BP

AZAMAT LEADER JAILED IN KAZAKHSTAN

Galym Abelseitov was taken into police custody on arrival at Almaty airport on 18 December and sentenced to 15 days in jail for his part in organizing the 30 November unsanctioned rally in the Kazakh capital, RFE/RL correspondents reported. Abelseitov, who was in Moscow for more than one month, has launched a hunger strike in his cell. Leaders of Azamat and other opposition movements in Kazakhstan held a press conference on 19 December to demand Abelseitov's release. BP

STRIKING KAZAKH WORKERS CLASH WITH POLICE

Striking workers from the Janatas Phosphorus Producing Plant fought with police officers outside the Kazakh presidential office in Almaty on 18 December when the police attempted to disperse them, according to RFE/RL correspondents. The police first tried ordering the workers from the area but met with physical resistance from the strikers. The workers are demanding the payment of $2 million in back wages. BP




OSCE MISSION CAN BEGIN WORK IN BELARUS

At the Organization on Security and Cooperation in Europe meeting in Copenhagen on 18 December, the Belarusian delegation agreed to allow an OSCE office to begin work in Minsk, RFE/RL's Belarusian service reported. Although it had agreed in principle in September to such an office, Minsk has blocked its opening until now. PG

BELARUS, RUSSIA TO SIGN DEFENSE COOPERATION ACCORD

Russian Defense Minister Igor Sergeev and his Belarusian counterpart, Aleksandr Chumakov, are to sign a bilateral treaty on military cooperation on 19 December, Interfax reported. The Belarus Defense Ministry said that the agreement "derives from the union treaty of Belarus and Russia." Among other things, the accord will establish a joint board of the defense ministries of the two countries. PG

CAUSE OF UKRAINIAN AIR CRASH DISPUTED

Ukraine's Aerosvit airline said that the Ukrainian airliner crash in Greece on 17 December may have been due to the inexperience of the crew, ITAR-TASS reported on 18 December. The wreckage of the plane, which was carrying 71 people, has still not been located. Leonid Pogrebnyak, the director of the airline, said the pilots in command had never flown that route before. Other experts commented that the accident might have been the result of foggy conditions. Officials confirmed, however, that the plane was not carrying any members of any official Greek delegation. PG

ESTONIAN PARLIAMENT, PRESIDENT DISAGREE OVER LANGUAGE LAW

Lawmakers have adopted amendments to the language law, rejecting President Lennart Meri's argument that the new legislation violates the constitution, ETA and BNS reported on 18 December. Meri, who refused to sign the amendments into law earlier this month, objects to the provision empowering the government to establish language proficiency requirements for parliamentary deputies and local government officials. He says this is not in line with the separation and balance of powers enshrined in the constitution. If he refuses again to proclaim the law, the Supreme Court will have to rule on the issue. JC

ESTONIA RECEIVES ANOTHER IMF CREDIT BUT WON'T DRAW MONEY

The IMF has approved a $22 million stand- by credit for Estonia, but Tallinn does not intend to draw on those funds, an RFE/RL correspondent in Washington reported. Estonia applied for the loan, as it did for a similar one last year, to take advantage of the IMF's technical assistance and advice. While praising Estonia's "remarkable performance" during the past few years, the fund advised the country to ensure that the banking system is not overextended with rising inflows of foreign capital and that real wage increases do not outstrip productivity gains. JC

LATVIA'S EU INTEGRATION CHIEF RESIGNS

Janis Vaivads, the director of the European Integration Office, resigned on 18 December following a meeting with Prime Minister Guntars Krasts, BNS reported. His resignation comes one week after the EU decided not to include Latvia among the countries invited to take part in "fast track" membership talks. A spokeswoman denied that Vaivads's decision had anything to do with the Luxembourg summit, stressing that Krasts had said on several occasions he was dissatisfied with the office's performance. Also on 18 December, Latvia and the EU signed a memorandum whereby the union will extend 3.2 million ecus (some $2.9 million) in technical assistance. JC

MOODY'S INCREASES LITHUANIA'S RATING

The international rating agency Moody's has increased Lithuania's credit rating to the level Ba1 for long-term foreign-currency deals, Interfax reported on 18 December, citing BNS. The new Moody's rating, however, is below the BBB- level awarded to Vilnius by Standard & Poor's, according to the Russian news agency. JC

CZECH POLITICAL LULL IN SIGHT?

President Vaclav Havel, who was recently treated in hospital for pneumonia, is to take a three-week holiday in the Canary Islands on the advice of his doctors, Reuters reported on 18 December. That means he is unlikely to appoint the new government now being formed by Prime Minister-designate Josef Tosovsky until mid-January. Also on 18 December, Tosovsky met with outgoing Premier Vaclav Klaus, Christian Democratic Party leader Josef Lux, and Civic Democratic Alliance chairman Jiri Skalicky. After that meeting, Tosovsky said the composition of the new cabinet need not reflect the current representation of parties in the parliament. He also said there was agreement that early elections would be held next year, CTK reported. MS

HAVEL WANTS KOHL TO ACCELERATE SETTING UP JOINT FUND

Havel on 18 December appealed to German Chancellor Helmut Kohl to accelerate the procedures for setting up a joint fund for reconciliation projects, AFP reported. The two countries decided to set up such a fund in January and to sign an accord on the issue before year's end. However, Germany recently asked to delay signing the agreement until end of January 1998. Bonn faces opposition from the organization representing the Germans expelled from Czechoslovakia after World War II, while Prague opposes the organization's participation in the fund because it has never recognized the Czech- German declaration of reconciliation. Germany is to contribute $80 million to the fund, and the Czech Republic $14 million. MS

HUNGARY, TURKEY SIGN MILITARY ACCORD

Hungarian Defense Minister Gyorgy Keleti and his visiting Turkish counterpart, Ismet Sezgin, have signed an agreement providing for an exchange of military cadets, Hungarian media reported on 18 December. Sezgin said Turkey has supported Hungary's accession to NATO "from the very beginning" and will offer assistance in entry preparations. He is scheduled on 19 December to meet with Prime Minister Gyula Horn and parliamentary chairman Zoltan Gal. MS




CLINTON SAYS U.S. TO STAY IN BOSNIA

President Bill Clinton said in Washington on 18 December that a continued U.S.-led international armed presence is necessary after SFOR's mandate expires in June in order to preserve peace and promote political and economic development. The new mission should have "benchmarks" for meeting specific goals but not an overall deadline, an RFE/RL correspondent reported from Washington. Clinton stated that the new force will probably be smaller than its predecessor but must still be "able to protect itself." The president added that Europe has done much for Bosnia but must do more. He also noted that the new mission to Bosnia "must have substantial support from Congress and the American people." PM

U.S. PRESIDENT OUTLINES DEFINITE AGENDA...

Clinton outlined a series of goals for the new force: "First, we must intensify our civilian and economic engagement... Civilian and voluntary agencies, working with Bosnian authorities, must help to do the following things: First, deepen and spread economic opportunity while rooting out corruption. Second, reform, retrain, and re-equip the police. Third, restructure the state-run media to meet international standards of objectivity and access. and establish alternative, independent media. Fourth, help more refugees return home. And fifth, make indicted war criminals answer for their crimes.... The second thing we must do is to continue to provide an international military presence that will enable these efforts to proceed in an atmosphere of confidence." PM

...GIVES WARNING

The president stressed that a lasting peace in Bosnia is possible and charged that those who suggest that its three main ethnic groups cannot live together are ignorant of Bosnian history. He also warned against partitioning the republic between the Muslims, Serbs, and Croats. Partition, he said, would "sanction the horrors of ethnic cleansing and send the wrong signal to extremists everywhere. At best, partition would require a peacekeeping force to patrol a volatile border for years to come. More likely it would set the stage also for renewed conflict." Meanwhile in Stockholm, Carl Bildt, the international community's former chief representative in Bosnia, said that a continued U.S. military presence is as necessary for stability in Bosnia now as it was in Berlin after World War Two. PM

BOSNIAN CROATS PROTEST ARREST OF WAR CRIMINALS...

Crowds blocked roads in Vitez on 18 December to demand that SFOR withdraw troops from around the home of one of the two indicted war criminals whom Dutch peacekeepers captured and sent to The Hague the previous night (see "RFE/RL Newsline," 18 December 1997). In Brussels, NATO Secretary-General Javier Solana telephoned Croatian President Franjo Tudjman and urged him to calm angry Bosnian Croats. In Sarajevo, Bosnian Croat leaders Kresimir Zubak and Vladimir Soljic said that SFOR's action was unnecessarily violent and aimed at humiliating all Croats and encouraging them to leave central Bosnia. In Zagreb, state-run television commented that it is not right that most Serbian indicted war criminals remain at large when "Serbs committed 90 percent of all war crimes." PM

...BUT SESELJ CALLS IT A TRICK

In Belgrade, ultra- nationalist Serbian presidential candidate Vojislav Seselj said on 18 December that "the SFOR action [against the two indicted Croats] was designed to trick international public opinion and hide the anti-Serbian character of the [Hague- based] tribunal. In Bonn, however, Foreign Minister Klaus Kinkel applauded SFOR's action, as did a French government spokeswoman in Paris. But at the UN in New York, Russian Ambassador Sergei Lavrov said that "Russia takes a negative view of any unilateral actions that might threaten the lives of the peacekeepers and that might undermine the entire process for a Bosnian settlement." He argued that SFOR exceeded its mandate by making the arrests. In Washington, politicians from across the political spectrum praised the arrests. Senator John Warner of the Armed Services Committee called for a bounty "of a million dollars or more" to be placed on the heads of prominent war criminals. PM

EUROPEAN COMMISSION FREEZES AID TO CROATIA

The European Commission's Sir Leon Brittan said in Strasbourg on 18 December that the EC has frozen $2.4 million in what he called technical aid because of Croatia's hounding of the independent media and NGOs. He singled out the authorities' treatment of the Croatian Helsinki Committee, the Open Society Institute, and the independent weekly "Feral Tribune." PM

TUDJMAN BLASTS CORRUPTION, INEQUALITY

President Tudjman said in a speech in Zagreb to mark the anniversary of the 1990 constitution that there is a "lack of will to prevent economic crime and corruption, tardiness and inefficiency" in the government, the parliament, and especially in the judiciary. He also blasted the "ruthless enrichment" of a few and called for greater "social justice" (see "RFE/RL Newsline," 17 December 1997). PM

ITALY, ALBANIA SIGN AGREEMENTS WORTH $220 MILLION

Italian Foreign Minister Lamberto Dini and several Albanian government ministers signed a package of agreements in Tirana on 18 December with an overall value of about $220 million. One program in the package aims to create 10,000 jobs in public works, but the centerpiece is a program to create 200,000 additional jobs in the private sector over the next three years. The aid includes credits and grants for different areas of the economy, health system, and infrastructure, "Gazeta Shqiptare" reported. Dini told his Albanian counterpart, Paskal Milo, that Italy will soon issue residence permits to Albanian refugees already in Italy. FS

IS TIDE TURNING AGAINST SMUGGLING IN ALBANIA?

Albanian police have seized a ship on the Adriatic that was carrying $1 million worth of contraband cigarettes. Police patrol boats blocked the path of a second ship, while two more vessels carrying suspected contraband escaped. Police and the local media called the seizure a great success. Albania has long served as a smuggling route to Italy and Yugoslavia. Contraband cigarettes also reach the domestic market. Earlier this week, the parliament passed a law allowing police to keep part of the proceeds from the contraband goods that they intercept. PM

FORMER ROMANIAN PRESIDENT TO BE INVESTIGATED...

The Prosecutor-General's Office will investigate the role of former President Ion Iliescu and other civilian members of the Romanian leadership in the initial stage of the December 1989 uprising. General Dan Voinea says Iliescu and other members of the provisional leadership ordered troops guarding the state television building to open fire on nearby crowds, RFE/RL's Bucharest bureau reported. Eighty people were killed and some 200 wounded. Voinea also said the office will investigate the so-called "terrorist diversion," which many believe was aimed at creating the impression that pro-Ceausescu forces and foreign mercenaries were attempting to restore the dictator to power. MS

...WHILE HE DENIES ALLEGATIONS

Meanwhile, in an interview on state television, Iliescu denied the allegations, saying they reflected the new administration's campaign to discredit him. An officer also interviewed by state television claimed that a declaration he allegedly submitted to his superiors shortly after the uprising was false. According to that declaration, he had received orders from Iliescu. The officer said he had lied in order to cover up both his desertion shortly after the revolt began and his call for the distribution of arms in order to "defend the revolution." The officer claimed the declaration had no "legal value" because it had not been made in the presence of a magistrate. MS

ROMANIA WANTS OSCE PRESIDENCY

Foreign Minister Adrian Severin on 18 December said Romania will submit its candidacy for the presidency of the Organization on Security and Cooperation in Europe for the year 2001. He said the decision is a signal of Romania's desire to continue to be involved in OSCE activities and of the fact that our country is ready to "assume more responsibilities in the organization." He was speaking in Copenhagen at the meeting of OSCE foreign ministers, RFE/RL reported. Severin also urged the OSCE to do more in assisting the warring sides in Moldova to reach a settlement. The organization should more actively assist in the withdrawal of Russian arms and ammunition located in the Transdniester, he argued. MS

TENSIONS CONTINUE OVER RUSSIAN GAS DELIVERIES TO BULGARIA

Gennadii Kozin, the director of Intergaz (the foreign trade subsidiary of Gazprom,) told RFE/RL on 18 December that Sofia must meet Gazprom's demands in order to receive gas deliveries next year. He said the Bulgarian government is refusing to pay the price demanded by Intergaz. One day earlier, Bulgarian officials announced they will no longer negotiate with Topenergy and will seek direct talks with Gazprom or Intergaz (See RFE/RL Newsline," 18 December 1997). Premier Ivan Kostov told RFE/RL that Gazprom director Rem Vyakhirev has guaranteed gas deliveries to Bulgaria, although the contract for such deliveries has expired. Kostov said he is ready to meet his Russian counterpart, Viktor Chernomyrdin, to resolve the dispute. Meanwhile, the opposition Socialist Party on 18 December demanded the resignation of Deputy Premier Evgeni Bakardzhiev over the failed talks with Topenergy. MS

BULGARIA FIGHTS CORRUPTION IN MILITARY

Defense Minister Georgi Ananiev, Prosecutor-General Ivan Tatartchev, and Chief Military Prosecutor Emil Karamfilov on 18 December signed a declaration to cooperate in fighting crime and corruption in the military, an RFE/RL correspondent in Sofia reported. Ananiev said the fight was launched some time ago, noting that corruption can be found at all levels--from the lower ranks to the top of the Defense Ministry. In other news, Air Force Commander General Stefan Popov said on 18 December that the situation in the force is "almost desperate." He noted that personnel has been reduced by 30 percent and several air force bases closed. MS




FROM ANARCHY TO UNCERTAIN STABILITY IN ALBANIA


by Fabian Schmidt

Albania descended into anarchy in February after five years of relative stability. The turmoil that followed the collapse of pyramid schemes, in which hundreds of thousands had invested their savings, demonstrated that Albania's post-communist economic and political progress was far short of what the governing Democratic Party had claimed.

Much of the relative prosperity that Albania had seen since the end of communist rule in 1991 did not, in fact, derive from the country's own economic strength. Albania imported large amounts of goods, but domestic production was diminishing, despite large-scale privatization. Cash remittances from Albanians living abroad and earnings derived from the smuggling of oil and arms to former Yugoslavia compensated for a huge trade deficit. During the 1991-1995 wars of the Yugoslav succession, the pyramid schemes served to launder money from such activities.

But the revolt this year was more than a reaction to an economic collapse; it was a protest against a government that was becoming increasingly authoritarian. After rigged elections in 1996, the collapse of the pyramids was the straw that broke the camel's back because it drove many people into poverty. The results were perhaps more dramatic than anyone could have foreseen.

People looted arms depots throughout Albania, and criminal gangs used the opportunity to expand their activities ranging from robbery to smuggling. Public order collapsed, and the country appeared to be only a step away from civil war. More than 2,000 people were killed throughout the country, most by accident. As in the case of the fall of communism in 1991, tens of thousands fled by boat to Italy or by various means of transport to Greece. In the most dramatic incident, more than 80 people died in the Adriatic Sea when a refugee boat collided with an Italian coast guard vessel in late March.

By that time, Organization on Security and Cooperation in Europe envoy Franz Vranitzky had successfully mediated an agreement between President Sali Berisha and the opposition. Both sides agreed to a government of national reconciliation under Socialist Prime Minister Bashkim Fino and to early elections. The Albanian authorities asked the international community to send in a multi-national stabilization force, but the West European Union and NATO declined to take full responsibility. Instead, it was left to Italy to assemble a force for Operation Alba after receiving a UN mandate. Various other European countries--including France, Greece, Turkey, Spain, Romania, Austria and Denmark-- participated in the contingent, which arrived in Albania in mid-April.

The parliamentary elections in late June and early July proceeded without major incident, even though the Albanian government, assisted by the OSCE, had hardly two months to prepare for them. Despite fears to the contrary, the elections were a success and ultimately led to the restoration of at least a modicum of law and order.

In August, a new Socialist-led coalition government took office under Prime Minister Fatos Nano, the former Socialist Party leader who was imprisoned under the previous government. The Socialists had gained over two- thirds of the parliamentary seats. Berisha resigned the presidency and the parliament elected as his replacement Rexhep Meidani, a physicist who has played a largely ceremonial role aimed at promoting national reconciliation. His predecessor, by contrast, had used a strong French- type presidency to carry out the policies of his Democratic Party.

But half a year after the new government took office, Albania's future remains uncertain. While the government has successfully managed to crack down on crime and reestablished freedom of movement throughout much of the country, it now faces the challenge of putting its economy back on track and reducing its budget deficit. Success or failure will depend on its ability to create new jobs, to collect taxes and customs duties, and to restructure its inefficient and often corrupt administration while avoiding political purges.

Open conflicts between the parliament, the president, and the judiciary suggest that power is more equally divided than was previously the case. Much remains to be done, however, including the drafting of a new constitution next year. Whether the government can avoid the mistakes of its predecessors and function on the basis of loyalty to the state rather than of partisanship is unclear. Sharp polemics between the Democrats and the Socialists indicate that much of the country remains polarized.


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