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Newsline - May 11, 1998




YELTSIN FILLS OUT CABINET...

President Boris Yeltsin completed the major government appointments on 8 May, RFE/RL's Moscow bureau reported. The president left Yevgenii Adamov in charge of the Atomic Energy Ministry, a post Adamov has held since March. Aleksandr Pochinok will remain head of the State Tax Service, which he has run since April 1997, ITAR-TASS reported. Yeltsin appointed Oleg Rutkovskii, until now head doctor at Moscow's First City Hospital, as health minister. He replaces Tatyana Dmitrieva, who had run that ministry since August 1996. Meanwhile, Nikolai Khvatkov has become head of the government apparatus. State Duma First Deputy Speaker Vladimir Ryzhkov of Our Home Is Russia was reportedly offered that job several times. Like Prime Minister Sergei Kirienko, Khvatkov is a former banker from Nizhnii Novgorod. Along with 10 other ministers, he is new to the cabinet (see "RFE/RL Newsline," 29 April and 4 May 1998). LB

...LEAVES TRADE AND INDUSTRY MINISTER WITH 'ACTING' STATUS

Also on 8 May, Yeltsin appointed Georgii Gabuniya as acting trade and industry minister, RFE/RL's Moscow bureau reported. Presidential spokesman Sergei Yastrzhembskii said Gabuniya was appointed acting minister because the Trade and Industry Ministry is new and "its formation will be difficult," according to Interfax. Before his appointment to the cabinet, Gabuniya served as first deputy head of the Foreign Trade Ministry, which no longer exists. He has been Russia's top negotiator on trade issues, such as the country's bid for membership in the World Trade Organization. Former Foreign Trade Minister Mikhail Fradkov's dismissal from the government was long anticipated, although he survived a mini-reshuffle in late February. LB

PERM LEGISLATOR BECOMES REGIONAL POLICY MINISTER

Yeltsin on 8 May appointed Yevgenii Sapiro as head of the Ministry on Regional and Nationalities Policy. Until now, Sapiro has been chairman of the Perm Oblast legislature and head of the Federation Council Economic Policy Committee. His appointment in effect rules out a cabinet post for Ramazan Abdulatipov. Abdulatipov, who is from Dagestan, gave up a seat in the State Duma last August to become deputy prime minister in charge of nationalities policy--a post that no longer exists. Yeltsin may yet appoint Abdulatipov as his envoy to the North Caucasus. LB

TRADE UNION LEADER TO SUPERVISE TRANSPORT MONOPOLIES

Yeltsin also appointed Vitalii Budko as head of the Federal Service for Regulating Monopolies in the Transportation Sector. For the last seven years, Budko has headed the Independent Trade Union for Coal Industry Workers. Tariffs for shipping cargo on Russian railroads are high, which has helped subsidize passenger rail traffic but has hurt industry, particularly the coal sector. Budko replaces Mikhail Kislyuk, who became head of the service last summer, shortly after Yeltsin fired him as governor of Kemerovo Oblast. At least one trade union representative was expected to be named to the cabinet, since union leaders had spoken out in support of Kirienko's nomination as prime minister. LB

WOMEN TO HEAD TWO MINISTRIES

Tatyana Dmitrieva's departure as head of the Health Ministry leaves two women out of the 26 ministers in Kirienko's cabinet: Culture Minister Natalya Dementeva and newly appointed Labor Minister Oksana Dmitrieva. Three other women appear likely to retain cabinet-level posts: Natalya Fonareva, the head of the State Anti-Monopoly Committee, Irina Khakamada, the head of the State Committee on Development and Support for Small Businesses, and Tatyana Regent, the head of the Federal Migration Service. LB

YELTSIN SACKS HEAD OF CUSTOMS COMMITTEE...

Presidential spokesman Yastrzhembskii announced on 8 May that Yeltsin has dismissed State Customs Committee head Anatolii Kruglov, RFE/RL's Moscow bureau reported. Valerii Draganov, up to now deputy chairman of the service, will replace Kruglov. The government recently approved new revenue targets for the customs service, which is now expected to collect 78 billion rubles ($12.7 billion) this year--4.3 billion rubles more than the level projected under the 1998 budget. The committee collected 18.5 billion rubles in customs duties during the first quarter of this year. According to "Kommersant-Daily" on 8 May, the customs committee has recommended that the government increase revenues by reviewing the customs breaks currently granted to Kaliningrad Oblast. The committee estimates that 55 percent of all reductions in customs duties during the first quarter of the year were granted on goods imported to Kaliningrad. LB

...AND HEAD OF BROADCASTING SERVICE

Also on 8 May, Yeltsin dismissed Valentin Lazutkin, who had headed the Federal Television and Radio Broadcasting Service for three years. Duma Culture Committee Deputy Chairman Mikhail Seslavinskii, a Nizhnii Novgorod native and member of the Our Home Is Russia faction, will replace Lazutkin. In an interview with RFE/RL's Moscow bureau on 8 May, NTV- holding director-general Igor Malashenko said Lazutkin's dismissal was long expected in media circles. He characterized Seslavinskii as a "professional" with a good reputation, despite his lack of experience working in the media. Malashenko added that Seslavinskii's appointment did not bear out the "worst fears" of journalists, namely that Lazutkin would be replaced by someone with "political commissar" tendencies who would blindly follow orders from above. NTV-holding manages the influential private network NTV and other companies involved with broadcast media financed by Vladimir Gusinskii's Media-Most company. LB

DECREE REORGANIZES STATE-OWNED BROADCAST MEDIA

Yeltsin has signed a decree on reorganizing state- owned electronic media into a single holding company, RFE/RL's Moscow bureau reported on 8 May. Details about the decree remain sketchy, but RFE/RL described it as a "revolutionary" measure that will transform state-owned radio and television stations in the regions into affiliates of the All-Russian State Television and Radio Company (VGTRK), which is more commonly known as Russian Television (RTR). The holding company will also include state-owned broadcasting facilities, such as television towers, but it is not yet clear whether those facilities will be subordinated to VGTRK. According to RFE/RL, the new holding company will seek to counteract the influence of privately owned media. Since last summer, some high- ranking government officials have received unfavorable coverage on the private network NTV and on Russian Public Television, which is 51 percent state-owned but considered under the influence of Boris Berezovskii. LB

NDR ADOPTS CAUTIOUS STANCE TOWARD NEW CABINET

Aleksandr Shokhin, the leader of the Our Home Is Russia (NDR) Duma faction, announced on 7 May that his faction no longer considers itself responsible for the government's actions, RFE/RL's Moscow bureau reported. During Viktor Chernomyrdin's tenure as prime minister, the NDR was a pro-government movement and was informally known as the "party of power." But Shokhin told Interfax that Kirienko had not accepted any of the NDR's recommendations when forming the new government. (A few ministers are formally NDR members but are not actively involved in the movement.) At the same time, Shokhin praised Nikolai Khvatkov as a "worthy" successor to Vladimir Babichev, the close Chernomyrdin ally and longtime head of the government apparatus. For his part, Chernomyrdin told RFE/RL's Moscow bureau on 8 May that his movement will judge the new government by its work. LB

OPPOSITION SLAMS GOVERNMENT APPOINTMENTS

Duma deputy Valentin Kuptsov, a high-ranking Communist Party official, sharply criticized the latest cabinet appointments in an interview with Interfax on 8 May. He cited Gabuniya's appointment as evidence of the general neglect of industrial policy. Kuptsov argued that Yeltsin could have chosen a "sensible" trade and industry minister from some 10,000 directors of industrial enterprises. Also on 8 May, Duma Geopolitics Committee Chairman Aleksei Mitrofanov of the Liberal Democratic Party of Russia (LDPR) dismissed Kirienko's cabinet as a "government of bleak functionaries" that will be "weak and fully dependent" on Yeltsin and the presidential administration. But Vladimir Gusev, another LDPR member who chairs the Duma Committee on Industry, said his committee will seek opportunities to work with Kirienko's government. LB

RYBKIN TO BECOME SPECIAL ENVOY FOR CIS?

Unnamed government sources told Interfax and ITAR-TASS on 8 May that Ivan Rybkin may be appointed Yeltsin's special envoy for the CIS. Rybkin flew to Baku on 8 May to congratulate Azerbaijani President Heidar Aliyev on his 75th birthday on behalf of Yeltsin. The sources said Rybkin's new job would have a rank equivalent to that of a deputy prime minister. Rybkin was a deputy premier in the government Yeltsin sacked in March, but Kirienko has only three deputies: Boris Nemtsov, Viktor Khristenko, and Oleg Sysuev. Rybkin is considered close to Boris Berezovskii, who was recently appointed executive secretary of the CIS. LB

INTERIOR MINISTRY TROOPS TO HAVE NEW COMMANDER

Yeltsin on 9 May appointed Pavel Maslov as deputy interior minister and commander of the troops subordinated to the Interior Ministry, Russian news agencies reported. Until now Maslov has been first deputy interior minister and head of the ministry's General Staff. He replaces Leontii Shevtsov, who announced in March that the Interior Ministry troops will be downsized from 257,000 to 220,000 by the end of 1999 (see "RFE/RL Newsline," 25 March 1998). The troops substantially increased in number when Anatolii Kulikov was interior minister from June 1995 to March 1998. LB

RUSSIA MARKS V-E DAY

Yeltsin, Kirienko, and Defense Minister Igor Sergeev were among the officials who stood on the Lenin mausoleum to observe a military parade on Moscow's Red Square on 9 May, the Russian holiday marking the allies' victory in World War II, Russian news agencies reported. War veterans held rallies across Russia to celebrate the anniversary. In Moscow, tens of thousands attended an alternative rally organized by communist groups, Reuters reported. Addressing the crowd, Communist Party leader Gennadii Zyuganov said that "we won in 1945 because we were a united people...and were led by the Communist Party," Interfax reported. Zyuganov added that the current "aggressors" against Russia "sit in the Kremlin." He said the Popular Patriotic Union of Russia, a Communist-led umbrella movement, will stage a nationwide protest in early October to demand Yeltsin's resignation and express no confidence in Kirienko's government. LB

PARLIAMENTARY NEWSPAPER LAUNCHED

"Parlamentskaya gazeta," the official newspaper of the parliament, published its first issue on 7 May, Reuters reported. A front-page commentary by Federation Council Speaker Yegor Stroev hailed "a special day in the history of domestic journalism," and Duma Speaker Gennadii Seleznev wrote that "the people's deputies now have a solid platform for an active dialogue with the electorate." The parliament has been without a newspaper since October 1993, when "Rossiiskaya gazeta" became the official paper of the Russian government. Yeltsin agreed to the creation of "Parlamentskaya gazeta" last October, as one of the concessions aimed at dissuading the Duma from voting no confidence in the government (see "RFE/RL Newsline," 21 October 1997). The editor in chief of the new paper is Leonid Kravchenko, who headed ITAR-TASS from 1988 to 1990 and has been first deputy editor of "Rossiiskaya gazeta" since 1993. LB

KIDNAPPERS DEMAND RANSOM FOR YELTSIN'S ENVOY

The abductors of presidential envoy Valentin Vlasov have demanded a "very large" sum for his release, despite acting Deputy Premier Ivan Rybkin's warning that no ransom will be paid, Russian media reported on 9 May. Vlasov was taken from his car at gun point on 1 May and his exact whereabouts remain unknown. Chechen intelligence sources and Russian Interior Minister Sergei Stepashin have both said that Vlasov is alive. Rybkin met on 9 May in Baku with Chechen President Aslan Maskhadov to discuss the investigation into the abduction. Also on 9 May, five armed Chechens were detained in the Kursk district of Stavropol Krai, bordering on Chechnya, but were later released. LF

AZERBAIJANI TRADER STABBED TO DEATH IN MOSCOW

A young Azerbaijani was stabbed to death in a dispute at Moscow's Luzhniki stadium market on 7 May. Fellow Azerbaijanis who tried to stage a protest march in central Moscow bearing the body of the murdered man were dispersed by OMON police. Six suspects in the murder were arrested the following day. Russian Interior Minister Sergei Stepashin and Moscow Mayor Yurii Luzhkov both denied claims by Azerbaijani human rights activists that the killing was ethnically motivated. Azerbaijani President Heidar Aliyev is personally following the investigation, according to ANS-Press. LF




GEORGIA TO BECOME 'ASYMMETRIC FEDERATION?'

In his traditional weekly radio broadcast on 11 May, Georgian President Eduard Shevardnadze said that within the next few days, he plans to unveil a new proposal whereby Georgia will become an "asymmetric federal state," Caucasus Press reported. Shevardnadze argued that this proposal demonstrates Georgia is seriously concerned about resolving the Abkhaz conflict. The Abkhaz government last week placed its armed forces on combat alert after some 300 fighters from the unofficial Georgian White Legion crossed into Abkhaz territory. Tamaz Nadareishvili, the chairman of the Abkhaz parliament in exile, warned on 6 May that support for the White Legion will grow if the repatriation of Georgian displaced persons to Abkhazia is not expedited. LF

AZERBAIJANI OPPOSITION ACTIVISTS CHARGED AFTER PROTEST

Police used force to disperse some 400 members of the Movement for Democratic Elections who staged an unsanctioned demonstration outside the parliament building in Baku on 8 May, Turan and Interfax reported. The demonstrators were protesting the new presidential election law, passed in the second reading on 6 May, which they say is undemocratic and renders free and fair elections impossible. Police arrested some 50 demonstrators, including former Prime Minister Panah Guseinov and former State Counselor Arif Gadzhiev. Some of the detainees have been charged with obstructing police or violating legislation on demonstrations. LF

AZERBAIJAN, UKRAINE DISCUSS OIL EXPORTS

Visiting Baku to congratulate President Heidar Aliyev on his 75th birthday, Ukrainian Prime Minister Valeriy Pustovoytenko met with both Aliyev and his Azerbaijani counterpart, Artur Rasi-Zade, to discuss the transport of Azerbaijani oil by tanker from the Black Sea port of Supsa to Odessa. Some oil would be refined in Odessa for domestic use and the rest exported via the Odessa-Brody pipeline. In Washington, Ukrainian Ambassador Yuri Shcherbak discussed with U.S. trade and energy officials the Ukrainian option for exporting Azerbaijani oil, according to Interfax. The Turkish government may commission a private company to build the proposed Baku-Ceyhan oil export pipeline if the Azerbaijani International Operating Company that is exploiting three offshore Azerbaijani oil fields declines to make a firm commitment on that project, the "Turkish Daily News" reported on 9 May. Royal Dutch Shell has expressed interest to the Turkish government in building that pipeline. LF

AZERBAIJAN PROPOSES EXCHANGING POWS

The Azerbaijani State Commission for Prisoners of War, Hostages, and Persons Missing in Action has proposed that Azerbaijan and Armenia exchange prisoners of war on an "all for all" basis, Turan reported on 7 May. Some 700 Armenians and 800 Azerbaijanis are currently listed as falling into those three categories. LF

HEAVY FLOODING IN TAJIKISTAN

While the damage caused by the recent flooding in central Tajikistan's Garm region is still being assessed, reports from the country's southern Khatlon region show even greater damage following flooding there, ITAR-TASS and the Voice of the Islamic Republic of Iran reported. At least 100 people are dead or missing and 4,000 homeless. More than 11,000 hectares of cultivated land are reported to have been ruined. Relief began arriving from neighboring Uzbekistan on 7 May, while northern Tajikistan's Leninabad Region and the Red Cross have sent supplies to the region. Tajik Prime Minister Yahye Azimov, who was in Khatlon to inspect the damage, described government relief efforts as "unsatisfactory." He said the disasters in Garm and Khatlon clearly show that ministries such as those for Emergency Situations and Civil Defense "are not ready to take necessary measures in an emergency." BP

WAHHABI TRIALS BEGIN IN UZBEKISTAN

The trials of 12 out of a total of 27 suspected Islamic militants began in the eastern city of Namangan on 7 May, RFE/RL correspondents reported. The men, who are allegedly Wahhabis, have been accused of planning the violence in Namangan last December. Four of the accused have pleaded guilty to taking part in a conspiracy to undermine the state. In an interview with Uzbek Television the next day, President Islam Karimov said the threat of fundamentalism and Wahhabism originates in Afghanistan. He added that those involved want to make Tajikistan an Islamic state and then import their "ideology" into Uzbekistan through the Fergana Valley. BP

KYRGYZ MUFTIAT COMPLAINS ABOUT MEDIA COVERAGE OF MUSLIMS

Kyrgyzstan's Muftiat or Spiritual Directorate of Muslims has denounced the coverage of Islam by two of the country's newspapers, RFE/RL correspondents and Interfax reported. The statement by the Muftiat said articles in "Utro Bishkeka" on 25 April and in "Vecherny Bishkek" on 1 May attached "labels of Wahhabites and fanatics to Muslims." Also, the statement said the articles created a "negative opinion and hatred toward practicing Muslims" and that authorities were responsible for permitting the media to "openly provoke" the population. The deputy editor-in-chief of "Vecherny Bishkek" responded that the Muftiat is trying to generate anti-Russian feelings by saying Russians do not respect Muslims. BP

KAZAKH PRIME MINISTER IN CHINA

Nurlan Balgimbayev told Chinese officials on 8 May that his country "does not have and will not have" groups supporting Muslim separatists in China's Xinjiang Province (the Uyghur Autonomous Region), ITAR-TASS and Xinhua news agency reported. Kazakhstan borders Xinjiang Province and has the largest population of Uyghurs in the CIS. Balgimbayev said after his meeting with Chinese Prime Minister Zhu Rongji the previous day that both countries reaffirmed their commitment to the proposed $9 billion oil pipeline that will transport oil from western Kazakhstan to China. According to Balgimbayev, a feasibility study for the project will be completed this December. He also said China will extend a $100 million loan to small businesses in Kazakhstan and donate another $100,000 for Kazakhstan's census next year. Xinhua reported that trade between Kazakhstan and China totaled $101 million in the first quarter of 1998, up 19.1 percent on the same period last year. BP




UKRAINE STILL CLAIMS PART OF EX-USSR PROPERTY IN RUSSIA

Ukrainian Foreign Minister Borys Tarasyuk told journalists on 7 May that Ukraine's claim to part of the former Ukrainian SSR's property abroad "has not been taken off the agenda" in negotiations with Russia, Interfax reported. The parliament has postponed ratifying the 1994 agreement on sharing the former USSR's assets and liabilities between Ukraine and Russia. Tarasyuk also expressed amazement over Belarusian President Alyaksandr Lukashenka's remarks on Ukraine's debt to Belarus. Lukashenka had said earlier last week that Belarus will not ratify a border treaty with Ukraine until Kyiv pays $215 million in debts. JM

EBRD TO SUPPORT UKRAINIAN BUSINESS

Ukrainian National Bank Chairman Viktor Yushchenko and European Bank for Reconstruction and Development President Charles Frank, meeting in Kyiv on 8 May, signed an agreement on a credit line worth 80 million ecus to support small and medium-sized business in Ukraine, the Ukrainian News agency reported. AFP quoted an EBRD official as saying on 10 May that the EBRD will give its final answer to financing the construction of two nuclear reactors in Ukraine "in a few months." Ukraine is seeking international funds for nuclear plants in Rivne and Khmelnytskyy to compensate for the planned closure of the Chornobyl plant. JM

UKRAINIAN PREMIER APPEALS TO IMF FOR MILDER STANCE

Valeriy Pustovoytenko has complained about the tough stance of the IMF, which is demanding economic austerity measures in exchange for more loans, ITAR-TASS reported on 10 May. The fund wants Ukraine to abolish its system of social benefits and increase the price of electricity, gas, and municipal services. According to Pustovoytenko, this would trigger a "social explosion" in Ukraine. Meanwhile, at a meeting with EBRD President Charles Frank the same day, Pustovoytenko pledged that his government will continue economic reforms. JM

BEREZOVSKII SAYS HIS VIEW OF CIS GOALS COINCIDES WITH LUKASHENKA'S

Following his meeting with Belarusian President Lukashenka in Minsk on 8 May, CIS Executive Secretary Boris Berezovskii said their views of the CIS's strategic goals coincide, ITAR-TASS reported. Summing up his recent meetings with the presidents of Ukraine, Moldova (see below), and Belarus, Berezovskii said he had noted "concern about the fact that there are few specific actions." He added that those countries also share the "unconditional will and desire to develop relations within the commonwealth." JM

EXILED OPPOSITIONIST PROPOSES HIMSELF FOR "PRISONER EXCHANGE"

Syarhey Navumchyk, a Belarusian Popular Front activist who received political asylum in the U.S. in 1996, has sent a letter to Belarusian President Lukashenka proposing he serve a prison term for two young oppositionists, RFE/RL Belarusian Service reported. Navumchyk said he feels moral responsibility for 18-year- old Alyaksey Shydlouski and 23-years-old Pavel Sevyarynets, who, he said, "have been brought up on the renewed ideas of national revival" advocated by the Belarusian opposition. JM

BALTIC ASSEMBLY CONDEMNS RUSSIAN INTERFERENCE IN LATVIAN AFFAIRS

The Baltic Parliamentary Assembly on 9 May adopted a resolution condemning what it called Russian interference in Latvia's internal affairs, BNS reported. The assembly expressed disapproval of Russian economic pressure on Latvia as well as Russian attempts to "incite hatred among the Baltic States." And it also said that Russian officials' recent accusations against Latvia have become "especially menacing, though ungrounded." At the same time, the resolution affirmed the desire to develop good neighborly relations with all democratic countries, including Russia. JC

THREE DETAINED OVER DOBELE BOMBING

Three youths aged 18 have been detained in connection with the 4 May bombing of a Soviet-era monument to World War II victims in the Latvian city of Dobele, BNS reported on 8 May. Criminal police chief Aloizs Blonskis told journalists that the detainees had harbored no political motives but had wanted to see how the local police would respond. Another person is wanted on suspicion of involvement in the blast. Meanwhile in Lestene, the remains of 10 members of the Latvian Waffen-SS Legion were reburied without military honors in what is to become a memorial cemetery. Some 1,000 people were present, including former commander of the armed forces Juris Dalbins and several parliamentary deputies. No government officials attended the reburial. JC

STANDARD & POOR'S RECONFIRMS CREDIT RATING FOR LATVIA

The international rating agency Standard & Poor's has reconfirmed its BBB foreign-currency and A- local-currency long-term rating for Latvia, BNS reported. The agency noted Latvia's success in reforming the economy and attaining a 6 percent growth. At the same time, it pointed to several negative factors, including the threat to tight fiscal policy posed by the upcoming elections, the delay in privatizing large-scale enterprises, and the threat to the trade balance owing to tensions in relations with Russia. JC

EBRD PREDICTS SLOWER GROWTH IN BALTICS THIS YEAR...

The EBRD has predicted 5.5 percent economic growth in Estonia in 1998, compared with 10 percent last year, BNS reported. Latvia is expected to sustain the 6 percent growth it achieved last year, while the growth of the Lithuanian economy is predicted to slow to 5.5 percent, down from 5.7 percent in 1997. The EBRD report was released ahead of the bank's annual meeting. JC

...AND PRAISES POLISH REFORMS

The EBRD also praised Poland for its well-advanced reforms and gave the Polish economy second place in Central Europe, after Hungary. The bank praised in particular Poland's transformation of its legal system but pointed to the slow pace of restructuring the financial sector. JM

CZECH POLICE OFFICIALS RESIGN OVER COMMUNIST- ERA ACTIVITIES

Prague police chief Miroslav Bornik resigned on 7 May amid media allegations that he had participated in the questioning of anti-Communist demonstrators in January 1989. One witness said Bornik had forced him to sign a fabricated protocol that was later used in one of Vaclav Havel's trials. Bornik said he does not remember what happened nine years ago. Interior Minister Cyril Svoboda said he has accepted Bornik's resignation and transferred him to an anti-drug unit. In a separate development, also on 7 May, Intelligence Agency chief Karel Vulterin accepted the resignation of his deputy, Lubos Dolezal, after it was revealed that he had served in the Communist-era secret services, Czech Television reported. MS

CZECH EXTREMIST LEADER BEATEN BY ROMA

Miroslav Sladek, leader of the far right Republican Party, was beaten by a group of Roma on 9 May, CTK reported. The incident occurred in Novy Bor while Sladek was addressing a public meeting. A local Roma representative said his speech had incited racial hatred. Police intervened and broke up the fist-fight by firing a shot in the air. In a separate incident, five skinheads were detained on 8 May after physically attacking two Indian men in the Prague subway. The attack followed a demonstration against the growing number of neo-Nazi incidents. And the next day in the same subway, an Algerian was stabbed in the kidneys and had to be hospitalized. MS

MECIAR REJECTS RESPONSIBILITY FOR PRIVATIZATION MISTAKES

Slovak Prime Minister Vladimir Meciar on 7 May rejected responsibility for the legal errors in privatization contracts. He said most of the errors occurred when he was in opposition, CTK reported. Meciar's government decided to abandon coupon privatization, which had been used in Czechoslovakia, and opted for direct sell-offs of property assets. MS

HUNGARIAN RULING PARTY LEADS AFTER FIRST ROUND OF ELECTIONS

The Socialist Party won 32.2 percent of the vote in the first round of the parliamentary elections on 10 May (compared with 33 percent in 1994). But Its coalition partner, the Free Democratic Party, suffered substantial losses, gaining only 7.8 percent (19.7 percent four years ago). With 28.2 percent of the vote (7 percent in 1994), FIDESZ emerged as the main contender among opposition parties. Owing to election agreements with other opposition parties on supporting best-placed candidates, FIDESZ may emerge as the winner after the second round of the elections, to be held in two weeks. The Smallholders Party increased its support from 8.8 percent to 13.7 percent. For the first time, the far-right Justice and Life Party passed the electoral threshold, winning 5.5 percent of the vote. Turnout was 56 percent, compared with 69 percent in 1994. MS




HOLBROOKE SAYS KOSOVA 'EXTRAORDINARILY DANGEROUS'

Former chief U.S. envoy to the former Yugoslavia Richard Holbrooke said in Tirana on 10 May that Yugoslav President Slobodan Milosevic, Kosovar shadow- state President Ibrahim Rugova, and Albanian Prime Minister Fatos Nano all agree that the situation in Kosova is dangerous. The diplomat added, however, that the three do not agree on what to do next. Holbrooke and Robert Gelbard, who succeeded him at the State Department, obtained no concessions from Milosevic during talks in Belgrade on 9 May. The following day, the two diplomats visited Prishtina to "listen and learn" in talks with the Kosovar leadership. Holbrooke said: "I have no idea" how to solve the Kosovar problem. The envoy added that Milosevic made it clear that "he does not want an international negotiator." On 11 May, Holbrooke again met with Milosevic in Belgrade. PM

MORE SANCTIONS IMPOSED ON SERBIA

At a meeting of foreign ministers of the G-8 countries in London on 9 May, the U.S., U.K., Germany, France, Italy, and Canada agreed to ban future foreign investments in Serbia. They also confirmed an earlier decision by the Contact Group to freeze Serbian and Yugoslav assets abroad. The Western foreign ministers issued a communique saying they "are deeply concerned by the increasing violence and growing polarization in Kosova and in particular the excessive use of force by the Serbian forces." They called on both sides to begin unconditional talks under international mediation. Russian envoys neither agreed to nor blocked the sanctions package. Japanese diplomats said they "will study" possible courses of action. PM

MONTENEGRO UNAFFECTED BY SANCTIONS?

In Podgorica, Montenegrin President Milo Djukanovic said that the sanctions will not affect his mountainous republic, RFE/RL's South Slavic Service reported on 9 May. In Belgrade, a government spokesman argued that the sanctions "will only hurt the Serbian people." In Tirana, the Foreign Ministry issued a statement calling for tougher measures than the sanctions. "Belgrade should be forced to stop the policy of war and bloodshed and sit at the negotiating table with ethnic Albanians in the presence of an international factor." The statement added that Kosova otherwise could become "a second Bosnia." The ministry also charged that the Serbian authorities are trying to create "a sanitary cordon" between Kosova and Albania (see "End Note" below). PM

HYDROELECTRIC PLANT CLOSED IN KOSOVA

Radisav Vlahovic, the director of the Koznjar hydroelectric plant near Decan, told Beta on 10 May that he ordered the enterprise closed because "Albanian terrorists are everywhere in the area and the workers are afraid for their safety," "Nasa Borba" reported. Two days earlier, police closed the Prishtina-Peja road because of heavy fighting in the area. Serbian and Albanian sources in Prishtina each claimed in recent days that their respective sides suffered several deaths in various places in Kosova. PM

GRANIC APOLOGIZES FOR PERSECUTION OF JEWS

Croatian Foreign Minister Mate Granic apologized in Jerusalem on 11 May for the persecution that led to the deaths of thousands of Croatian Jews in the Holocaust. "Relying on its freedom-loving and anti-fascist roots, the modern democratic Croatia in the strongest possible terms condemns fascism, racial hatred, xenophobia, and anti-Semitism. I express and testify to the deepest regret and condemnation of the persecution, suffering ,and the tragedy of the Jews on Croatian territory under the Ustasha regime." At the Yad Vashem Memorial, Granic said: "On behalf of the government of Croatia and with deepest respect for the victims of the Holocaust, I express eternal condemnation of the crime of genocide of 6 million Jews." Many observers in Israel, Croatia, and elsewhere have accused Croatian President Franjo Tudjman of playing down the Holocaust and of anti-Semitism in his historical writings. PM

POPE TO RETURN TO CROATIA

Spokesmen for the Roman Catholic Church said in Zagreb on 8 May that Pope John Paul II will visit Croatia from 2-4 October to honor Cardinal Alojzije Stepinac on what would have been his 100th birthday. The Pope will proclaim Stepinac "blessed," which is the first step on the road to sainthood. Many Croats believe that Stepinac, whom the Communists imprisoned, was a martyr for his faith and country. Many Communists and Serbs regard him as an Axis-sympathizer. In Zagreb on 10 May, Archbishop Josip Bozanic warned that attempts to turn Roman Catholicism into a political ideology are doomed. And in Ljubljana, unnamed persons have opened a law suit against former Communist-era leader Mitja Ribicic for his role in the "genocide of the ethnic German minority" immediately after World War II, RFE/RL's South Slavic Service reported on 8 May. PM

ALBANIAN DEMOCRATS DEMONSTRATE IN VLORA

Democratic Party leaders arrived in Vlora on 9 May to take part in the first Democratic rally there since the unrest began in the town last February. Party deputy chairman Genc Pollo and legislator Azem Hajdari addressed the 2,500 demonstrators. Party leader Sali Berisha did not attend the rally owing to concerns for his safety. A group of women threw stones at the delegation's heavily guarded cars, but no other incidents were reported. Daan Everts, who is the Organization for Security and Cooperation in Europe's ambassador to Albania, accompanied the visitors, "Gazeta Shqiptare" reported. FS

ALBANIAN PREMIER CALLS FOR INVESTMENTS

During a visit to Thessaloniki on 8-9 May, Fatos Nano called on Greek businesses to increase investments in Albania, saying the period of instability is over. He told members of the Union of Northern Greek Industries that "I can guarantee that situations similar to last year's...will never arise again." Some 200 Greek companies have invested some $100 million in Albania. The following day, Greek Interior Minister Georgios Romeos pledged to provide assistance, including patrol cars and bullet-proof vests, to Albanian border guards to help them prevent illegal immigrants from entering Greece. FS

MORE FALLOUT FROM ROMANIAN 'CIGARETTE AFFAIR'

Another three persons, two of them officers and the third a woman, have been detained in connection with the "cigarette affair," RFE/RL's Bucharest bureau reported on 10 May. This brings the total number of detainees in connection with the affair to 14. Two days earlier, the Supreme National Defense Council, chaired by President Emil Constantinescu, said that people "working in state institutions were directly involved" in smuggling "over the last six years." It said new legislation dealing with the status of foreigners in the country must be "urgently passed." Some detainees are Arabs resident in Romania. In a clear hint to the Greater Romania Party, the council also said the parliament must "analyze the existence" of "parallel [illegal] information structures." MS

PRESIDENTIAL COUNSELOR SUES OPPOSITION LEADER

Dorin Marian on 8 May launched legal proceedings against Senator Radu Timofte for libel. Timofte, who represents the opposition Party of Social Democracy in Romania, has accused Marian of involvement in the cigarette-smuggling scandal. MS

BULGARIAN AIR COMPANY REJECTS ROMANIAN ACCUSATIONS

Rumen Draganov, the director-general of Air Sofia, on 8 May rejected Romanian accusations that one of his company's planes was involved in the cigarette affair. In an interview with Romanian Radio, Draganov said the allegations by Romanian Transportation Minister Traian Basescu that his company has not forwarded to Bucharest documentation on the plane's cargo are inaccurate. He added that the Romanian side "should have had copies" of the documents it is now requesting from Air Sofia. According to Basescu, Air Sofia has been "consistently involved in smuggling." He has said that Romania will deny the company the right to overfly its territory in the future. MS

ROMANIAN DIPLOMATS DISMISSED OVER GERMAN 'CHILDREN THEFT RING'

President Constantinescu on 10 May asked Prime Minister Radu Vasile to investigate the activities of all Romanian consular services abroad. His request follows the Foreign Ministry's 7 May decision to dismiss the Romanian consul in Bonn and his deputy and to launch legal proceedings against them. The ministry also announced it will replace the entire staff of the consulate. Last month, German prosecutors accused the staff of the Romanian embassy in Bonn of providing false identification papers to criminals who illegally brought children into the country and forced them to pickpocket. MS

BEREZOVSKII, LUCINSCHI HAVE SAME VIEWS ON CIS'S FUTURE

CIS Executive Secretary Boris Berezovskii told journalists in Chisinau on 7 May that in order to succeed in the future, the CIS must rid itself of the "Big Brother mentality" still prevailing among some of its members, RFE/RL's Chisinau bureau reported. President Petru Lucinschi said after his talks with Berezovskii that they share views on the future of the commonwealth. Lucinschi said Berezovskii's appointment is a sign of the changes ahead since the Russian businessman is better equipped to deal with a "changing situation" in which the private sector increasingly takes over from the state sector. The two men also discussed the conflict with the Transdniestrian separatists. MS

BULGARIAN PARLIAMENT APPROVES AGRICULTURAL REFORM POLICIES

The parliament on 9 May approved a law abolishing subsidies to agriculture, an RFE/RL correspondent in Sofia reported. Agricultural Commission chairman Vladislav Kostov said the only way to implement "free-market principles" is to "break the pattern of artificial price increases." In other news, the EU and the European Bank for Reconstruction and Development have set up a $40 million investment fund to assist medium- sized Bulgarian businesses. MS




ALTERNATIVES TO SANCTIONS


by Patrick Moore

Meeting in London on 9 May, the foreign ministers of the U.S., U.K., France, Germany, Italy, and Canada agreed to freeze Yugoslav and Serbian assets abroad and to ban further foreign investment in Serbia. The ministers' goal is to press Yugoslav President Slobodan Milosevic to withdraw his paramilitary special police forces from Kosova and launch a dialogue with representatives of the ethnic Albanian majority there about the province's future. Recent experience involving Belgrade and sanctions, however, suggests that the ministers' latest move may prove counterproductive.

The UN placed all of rump Yugoslavia under tough economic sanctions on 30 May 1992 because of Belgrade's involvement in the wars in Croatia and Bosnia. The sanctions remained in force until the Dayton agreement was signed at the end of 1995. According to Richard Holbrooke, the U.S. diplomat who was the architect of the Dayton peace, the effects of the sanctions were one of the main reasons why Milosevic finally chose to seek peace.

There are three reasons, however, to suggest that the sanctions may have made it difficult to promote the cause of peace. First, the embargo was not selectively targeted at those in power but was rather a set of blanket measures that affected all Yugoslav citizens. The sanctions helped lower a standard of living --especially for the poor and the elderly--that was already bad enough thanks to Milosevic's neo-communist economic policies. They similarly hurt the struggling economies of neighboring Romania, Bulgaria, and Albania, whose governments estimate their losses from the sanctions in the billions of dollars.

Second, the sanctions had only a slow effect on the Milosevic regime, which, in any event, did not decide to go to Dayton until after the Krajina and Bosnian Serb armies had been routed on the battlefield. In the meantime, the regime had more than three-and-a-half years to tell its citizens that the source of their growing poverty was the foreigners' sanctions. In doing so, Milosevic's media skillfully boosted his popularity by playing on a traditional Serbian belief that the Serbs are often the victims of foreign-led conspiracies.

Third, the sanctions gave rise to sanctions-busting on a massive scale both in rump Yugoslavia and in some neighboring countries. This phenomenon led to the growth of mafia-like structures, many of whose members enjoyed excellent political connections, particularly in Belgrade. The growth of the mafias--whose profits often came from the pockets of ordinary citizens--also undermined all efforts aimed at promoting democratization and the rule of law.

In view of those experiences from 1992 to 1995, some Serbian opposition leaders and journalists as well as a number of prominent Kosovars have suggested that the international community should try to find alternatives to blanket economic sanctions. Speaking in Vienna on 6 May, reformist Montenegrin President Milo Djukanovic warned that such sanctions will hit ordinary people as well as the regime and will make it easy for Milosevic to clamp down on the reformers and blame foreigners for his country's growing poverty.

One alternative to economic sanctions might be to maintain and intensify the existing international political pressure on Milosevic by continuing to bar his government from membership in international organizations such as the Organization for Security and Cooperation in Europe. The fact that Belgrade frequently complains about the ban suggests that the measure is having some effect. The ban need not mean, however, that all Yugoslav passport holders will be barred from international meetings and events. Serbian opposition spokesmen stress that, on the contrary, the international community should clearly differentiate between the regime and other Serbs, who will play a key role in establishing an eventual post-Milosevic order in the Balkans. Opposition spokesmen therefore urge the international community to make special efforts to involve non-regime Yugoslav citizens in European and international forums.

Another alternative to an economic embargo is to find ways of increasing military pressure on Milosevic, which Kosovar leaders and the Albanian government have repeatedly urged NATO to do. They argue that Serbia ceased its aggression during the Croatian and Bosnian wars only when it came up against the clear willingness of NATO to use superior force. The leaders in Prishtina and Tirana add that a strong NATO presence along Serbia's frontiers with Kosova and perhaps with Macedonia would consequently be much more effective than economic sanctions in sending the message to Milosevic that the international community will not tolerate armed repression in Kosova.

Serbian opposition spokesmen, such as Radio B-92 chief editor Veran Matic, have frequently urged the international community to develop a serious and comprehensive program to support democratization and a civil society in Serbia. Matic further asks foreign diplomats to be firm in their opposition to the regime and to avoid flattering Milosevic by treating him as a peacemaker or offering him positive incentives.

Matic also stresses that new economic sanctions could prove a boon to the mafias and undermine the efforts of many people since 1995 aimed at establishing democratization and the rule of law in Montenegro, Albania, and the Republika Srpska. Biljana Plavsic, the president of the Republika Srpska, said recently that the key to resolving the Kosova crisis is the democratization of Serbia.


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