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Newsline - May 14, 1998




GOVERNMENT APPROVES DRAFT LAW ON BUDGETARY DISCIPLINE

The government on 14 May approved a bill that would block laws from going into effect if they do not specify sources of financing for all expenditures not foreseen in the federal budget, NTV reported. The government will soon submit the draft to the State Duma. According to ITAR-TASS, some cabinet ministers suggested that the measure might be unconstitutional because it could deprive of citizens of benefits to which they are entitled under federal law. Prime Minister Sergei Kirienko instructed the Justice Ministry to examine that question but argued that citizens' rights are violated when the parliament adopts laws without providing financial sources for their implementation. LB

KIRIENKO SEEKS TO 'ERADICATE LOBBYING'

Kirienko on 14 May announced that during his planned meeting with President Boris Yeltsin the same day, he will discuss measures to "eradicate lobbying," ITAR-TASS reported. Kirienko has already signed a directive whereby the government will not consider proposals involving increased budget expenditures unless those proposals specify sources of revenue to fund the new spending, "Kommersant-Daily" reported on 14 May. He and Yeltsin are to discuss a draft presidential decree that would oblige the presidential administration to impose similar conditions for its consideration of measures that would increase expenditures. "Kommersant-Daily" argued that such measures will largely "save paper" rather than money. The newspaper noted that the cash-strapped government is already unable to implement numerous presidential decrees and government directives. LB

YELTSIN PROPOSES RUSSIAN VENUE FOR G-8 MEETING IN 2000

Boris Yeltsin has proposed that the venue for the 2000 annual meeting of the world's leading industrial nations be changed from Nagano, Japan, to somewhere in Russia, AFP reported on 12 May. Yeltsin said in a live Internet session that he wants to host that meeting as it will be the last year of his presidency. As the scheduled host nation, Japan has the right to accept the change. The following day, Yoshio Hatiro, the secretary-general of the Japanese Association for Friendship with Russia, said he favors the change of venue as a "sign of concession," just as Japan hopes for a similar sign from Russia over the issue of the Kuril Islands. The Russian-Japanese peace treaty formally ending World War II between the two countries is due to be signed in 2000. BP

ZYUGANOV ON START-2, INDIA

Communist Party leader Gennadii Zyuganov on 13 May spoke out against ratifying the START-2 arms control treaty, Russian news agencies reported. He called for postponing ratification until after Russia has adopted a "security concept." He added that Russia and the U.S. had nuclear "parity" when the treaty was signed but that the current condition of the Russian defense industry makes it "impossible" to achieve an equal status. Regarding the recent nuclear tests conducted by India, Zyuganov said India "once again confirmed that it is a major global power to be reckoned with." He added that he was pleased to learn that "even the CIA was not informed" about the tests in advance. But while Zyuganov said he supports a "strategic partnership" between Russia and India, he noted he would not like India to threaten the security of any other country. LB

RUSSIA ADAMANT ABOUT S-300S TO CYPRUS

The press service of the Russian arms export company Rosvooruzhenie issued a statement on 13 May reaffirming its commitment to proceed with the delivery to Cyprus this summer of S-300 air defense missiles, the "Turkish Daily News" reported. The Russian Foreign Ministry told Interfax the same day that Moscow's position on Cyprus remains unchanged, stressing that the S-300s are a "purely defensive" weapon. Over the past week, UN Secretary- General Kofi Annan and French Foreign Minister Hubert Vedrine have both tried to persuade the Greek Cypriot leadership not to go ahead with the planned deployment. LF

ZHIRINOVSKY STILL HOPING FOR GOVERNMENT POSTS

Liberal Democratic Party of Russia (LDPR) leader Vladimir Zhirinovsky on 13 May expressed the hope that members of his party may yet be invited to join Kirienko's cabinet, ITAR-TASS reported. He noted that although Yeltsin has now appointed all the ministers, the LDPR is seeking several posts as deputies or first deputies in ministries. The LDPR Duma faction voted unanimously to confirm Kirienko as prime minister in the third and decisive vote. LB

NO CHARGES FILED IN BOOK SCANDAL...

The Moscow Prosecutor's Office will not file criminal charges against former officials who earned $90,000 each, allegedly for co- authoring a book on privatization. Prosecutor Sergei Gerasimov told Interfax on 13 May that since a private firm paid the officials, there is no evidence that they embezzled money from the state. He added that although examination of the manuscript suggests the publisher paid excessive fees, it is not a crime to pay authors too much. The Segodnya-Press publishing house, which is partly owned by Oneksimbank, paid the fees to, among others, former First Deputy Prime Minister Anatolii Chubais, former State Property Committee Chairman Alfred Kokh, and former State Property Minister Maksim Boiko. Many commentators have charged that the payments were tantamount to bribes, noting that firms linked to Oneksimbank won two controversial privatization auctions in 1997. LB

...WHILE KOKH STILL FACES CHARGES

Gerasimov told Interfax on 13 May that Kokh is still under criminal investigation for a separate book deal, in which he received $100,000 from a Swiss firm while he headed the State Property Committee. The deal raised eyebrows because of apparent connections between the Swiss company and Oneksimbank (see "RFE/RL Newsline," 2 October 1997). Gerasimov said the Russian Prosecutor- General's Office has requested information from the Swiss Prosecutor's Office relating to the case. Kokh, who is currently in the U.S., told ITAR-TASS on 13 May that his book will soon be published in English. He added that he plans to return to Moscow, where he faces criminal charges for allegedly misusing his official post to obtain a desirable apartment (see "RFE/RL Newsline," 6 May 1998). LB

PROMINENT DUMA DEPUTY LEAVES OUR HOME IS RUSSIA

Nikolai Travkin has left the Our Home Is Russia (NDR) Duma faction, "Nezavisimaya gazeta" and "Kommersant-Daily" reported on 14 May. A statement released by the NDR said Travkin quit the faction because he wants to run as an independent candidate for governor of Moscow Oblast, ITAR-TASS reported. But "Nezavisimaya gazeta" quoted an unnamed source as saying Travkin is dissatisfied with the "bureaucratic style" of the NDR leadership. Travkin, the founder of the once-prominent and now marginal Democratic Party of Russia, was sacked as that party's leader in late 1994 and was one of the NDR's top 10 candidates in the 1995 Duma election. His defection is the latest sign that prominent politicians are reluctant to maintain links with the NDR now that the movement's leader, Viktor Chernomyrdin, is no longer prime minister (see "RFE/RL Newsline," 7 May 1998). LB

ROKHLIN'S MOVEMENT TO SUE DEFENSE MINISTRY

Duma Defense Committee Chairman Lev Rokhlin's Movement to Support the Army is preparing to sue the Defense Ministry for failure to meet its financial obligations toward military personnel, "Kommersant-Daily" reported on 14 May. Rokhlin says his movement will also ask the Prosecutor-General's Office to open a criminal case on charges that chronic arrears are driving soldiers to suicide. Rokhlin recently sought unsuccessfully to have the Duma initiate impeachment proceedings against Yeltsin. He is expected to lose the chairmanship of the Defense Committee when the seven Duma factions complete the reallocation of leadership positions in the chamber. That reorganization was scheduled for January, but negotiations stalled over a few posts and were further delayed by events surrounding the cabinet dismissal and confirmation of Prime Minister Kirienko. LB

GOVERNMENT LIKELY TO DELAY OIL SECTOR PRIVATIZATIONS

First Deputy State Property Minister Aleksandr Braverman told Interfax on 13 May that the government is likely to postpone auctions for stakes in the Tyumen Oil Company, the Eastern Oil Company, and the Slavneft Oil Company (which is partly owned by Belarus). Braverman expects the sales to be postponed until the fall. He noted that several recent attempts to sell shares in those companies have fallen through because of lack of demand. The State Property Ministry is considering several options for selling off the shares but will make a final decision based on the situation on the stock market and the result of an upcoming auction for a 75 percent stake in the oil company Rosneft. That sale is planned for late May, but several potential investors have balked at the high price the government has set as the minimum bid. LB

RUSSIA EXPORTING MORE OIL BUT FOR LESS MONEY

Russian oil exports during the first quarter of 1998 totaled 29.66 million metric tons, up nearly 3 million metric tons compared with the same period in 1997, Interfax reported on 13 May, citing the State Customs Committee. However, the total value of Russian oil exports for the first quarter of the year was some $2.6 billion, down $0.92 billion compared with the same period the previous year. First Deputy Finance Minister Aleksei Kudrin announced on 11 May that the federal budget will lose an estimated $1.5 billion to $2 billion in 1998 as a result of slumping oil prices on world markets, ITAR-TASS reported. LB

YELTSIN SIGNS LAW ON PRIVATE PENSION FUNDS

Yeltsin has signed a law establishing a foundation for the activities of Russia's non-state pension funds, which have existed for six years, "Kommersant-Daily" reported on 13 May. The main cause of the long delay in adopting the law was a dispute over whether the Labor Ministry or the Federal Securities Commission would be granted the authority to monitor the funds. Then First Deputy Prime Minister Boris Nemtsov broke the impasse in March at a meeting involving several high-ranking officials and parliamentarians. Soon after, the Federation Council approved the Duma's version of the law, which puts the funds under the supervision of the Labor Ministry. Federal Securities Commission Chairman Dmitrii Vasilev lobbied unsuccessfully for a presidential veto. Implementing the law will require the adoption of various government resolutions regulating the activities of the non-state pension funds. LB

LEBED, ZUBOV FACE OFF IN TV DEBATE

Former Security Council Secretary Aleksandr Lebed and Krasnoyarsk Krai Governor Valerii Zubov clashed in a televised debate on 13 May, four days before the second round of the krai gubernatorial election. Zubov fielded questions well and cast doubt on many of Lebed's campaign claims, RFE/RL's correspondent in Krasnoyarsk reported. For example, he noted that the krai already has a law outlining a process for recalling elected officials, including the governor. (A major theme of Lebed's campaign is the need to adopt such a law.) Zubov also defended his record on attracting investment to the krai. However, Lebed had a better television presence than the governor, according to RFE/RL's correspondent. He appeared confident, steady, and unruffled, while Zubov came across as nervous. LB

ZYUGANOV KEEPS UP ATTACK ON LEBED...

Communist Party leader Zyuganov again blasted Lebed on 13 May, warning that his victory in the Krasnoyarsk election would allow the resource-rich krai to "dictate terms" to the federal authorities and eventually could lead to the "destruction of Russia," RFE/RL's Moscow bureau reported. He alleged that Lebed has flouted campaign finance regulations, while Yeltsin and the Central Electoral Commission keep silent. Zyuganov also repeated his call for voters to support Zubov's plans to appoint a coalition government. LB

...BUT COMMUNIST CAMP SPLIT OVER KRASNOYARSK RACE

The Communist camp is not united over the party leadership's endorsement of Zubov, RFE/RL's Moscow bureau reported on 13 May. Duma Deputy Petr Romanov, the Communist candidate who placed third in the first round of the election, told RFE/RL that Communist leaders should have warned the public about the dangers of electing Lebed earlier. He claimed that such warnings might have prevented Lebed from doing so well in the first round. Romanov believes that the stance of the Communist leadership now works to Lebed's advantage. Romanov will travel to Krasnoyarsk to encourage the krai branch of the Communist Party not to change its recommendation that residents vote against both Lebed and Zubov. LB

BOMB EXPLODES IN MOSCOW SYNAGOGUE

A bomb explosion caused extensive damage to a synagogue in downtown Moscow on 13 May, ITAR-TASS and Reuters reported. Rabbi Berel Lazar of the Lubavitch Marina Roshcha synagogue said it was not the first act of terrorism against the synagogue. Lazar called the bombing a "clearly anti-Semitic act" and demanded that the authorities find those responsible "in order to assure the Jews of Moscow and Russia they are safe." Worshippers had left the synagogue following the Lag B'Omer service just minutes before the bomb went off. The explosion did not prompt the Jewish community to cancel plans to hold a religious procession. "We will not be intimidated by this act," Lazar said. Meanwhile in Irkutsk, vandals damaged or destroyed 149 tombstones at a Jewish cemetery, ITAR- TASS reported on 13 May. It was the third act of vandalism at the cemetery since December. BP

FOUR KILLED IN GROZNY BOMBING

Four people were killed on 13 May when a bomb exploded in the Chechen capital. Magomed Koriev, first deputy director of the Chechen Security Service, said the bomb was directed at Deputy Prosecutor-General Magomed Magomadov, who is in charge of anti-kidnapping operations. Magomadov heads the Chechen team investigating the 1 May abduction of Russian presidential envoy to Chechnya Valentin Vlasov. LF

RUSSIA DENIES RANSOM DEMANDED FOR VLASOV

Interviewed by NTV on 13 May, Russian Interior Minister Sergei Stepashin denied claims by Federal Security Service Deputy Director Viktor Zorin that Vlasov's abductors have demanded a large ransom for his release. But "Segodnya" the next day reported that the kidnappers have proposed exchanging their prisoner for acting Ingush Interior Minister Daud Korigov, who is currently under investigation in Moscow. Also on 13 May, Yeltsin's representative in Chechnya, Georgii Kurin, met with Chechen Deputy Prime Minister Kazbek Makhashev to discuss Vlasov's kidnapping, ITAR-TASS reported. LF

DAGESTANI ORGANIZATIONS OPPOSE CHECHEN- DAGESTAN UNION

The leaders of 20 Dagestani political and public organizations issued a statement in Makhachkala on 13 May condemning the creation last month of a Congress of Chechen and Dagestani Peoples, Interfax reported. The signatories to the statement pointed out that they did not send delegates to the congress, which proclaimed its commitment to the peaceful unification of Chechnya and Dagestan. Claims that all Dagestani ethnic groups and political forces were represented at the congress are therefore "groundless," the statement said. LF




MINSK GROUP CO-CHAIRMEN IN YEREVAN

The three co-chairmen of the Organization for Security and Cooperation in Europe's Minsk Group met in Yerevan on 13 May with Foreign Minister Vartan Oskanian, who outlined Armenia's new approach to resolving the Karabakh conflict. Yerevan rejects the "phased" peace plan, which was proposed by the Minsk Group last year and which Azerbaijan has accepted. Instead, it insists on a "package" solution that resolves all contentious issues within one framework document. Armenia also wants direct, unconditional talks between Baku and the leadership of the unrecognized Nagorno-Karabakh Republic. The co-chairmen declined to comment on those demands, but Azerbaijani Presidential adviser Vafa Gulu-Zade has made direct talks with the Karabakh leadership contingent on the latter's acceptance of autonomy for Nagorno-Karabakh within Azerbaijan, Noyan Tapan reported. Oskanian told journalists that the co-chairmen made no new proposals. LF

ARMENIAN PARLIAMENT APPROVES GOVERNMENT PROGRAM

Speaker Khosrov Harutiunian on 13 May declared the parliament's approval of the program presented to lawmakers the previous day by Prime Minister Armen Darpinian, RFE/RL's Yerevan bureau reported. The parliament had lodged no formal objections to that program. Harutiunian congratulated the premier on what he termed a "vote of confidence" in the government. Darpinian, for his part, acknowledged informal criticisms by several parliament factions that the program is not specific enough, Noyan Tapan reported. LF

GEORGIAN, NORTH OSSETIAN PRESIDENTS MEET

Aleksandr Dzasokhov was in Tbilisi on 13 May for talks with his Georgian counterpart, Eduard Shevardnadze, on resolving the South Ossetian and other Caucasian conflicts. Dzasokhov argued that it is important to achieve a breakthrough in resolving one of those conflicts in order to create a precedent. He endorsed Shevardnadze's proposal that Georgia become a federal state, urging the Georgian leadership to be "generous" in deciding the degree of autonomy South Ossetia should receive. Dzasokhov warned that unless such federations are created in the Caucasus, the region risks "global disintegration into nation states," Interfax reported. Shevardnadze called for expediting the repatriation to South Ossetia of both Ossetian and Georgian refugees and displaced persons. He also praised the "positive" role of the Russian peacekeeping force in South Ossetia. LF

ANNAN WANTS BETTER PROTECTION FOR OBSERVERS IN GEORGIA

UN Secretary-General Annan has proposed deploying a 294-man UN force to protect the unarmed UN observer mission in western Georgia, Reuters reported on 13 May. Four members of that mission were abducted in February; three were subsequently released and one escaped. Annan said the Georgian government has approved his proposal, while the Abkhaz leadership has expressed reservations. LF

AZERBAIJANI LIBERAL PARTY PROTESTS HARASSMENT

The leadership of the Azerbaijan Liberal Party has called on the prosecutor-general to take action against police officers who forced entry into the party's headquarters on 8 May, Turan reported on 13 May. The officers temporarily detained two of the party's members. LF

KYRGYZ PRESIDENT OVERSEES BATTLE WITH "EXTREMISTS"

Presidential spokesman Kanybek Imanaliyev told a press briefing on 13 May that Askar Akayev is personally supervising the battle against religious extremism, ITAR-TASS reported. Imanaliyev said the president is concerned about the "appearance of Wahhabi missionaries." Kyrgyzstan, like neighboring Uzbekistan, has ordered all mosques to be registered. And according to Reuters, it will "keep track of who preaches there, where they are from. If they do not meet our standards they must account for themselves." However, Emil Kaptagaev, the chairman of the government Committee on Religious Affairs, told journalists his committee has found no evidence of Wahhabi activity in Kyrgyzstan. But Adylbek Kadyrbekov, the chairman of the parliamentary Committee on Defense and Security, was also at the briefing and contradicted Kaptagaev's statement. BP

WORLD BANK GRANTS LOAN TO KYRGYZSTAN

The Kyrgyz presidential press service announced on 13 May that the World Bank has approved a loan for the country worth $50 million, Interfax reported. The loan is intended for agricultural programs, in particular improving irrigation techniques. BP

KAZAKH PARLIAMENT REJECTS POLYGAMY PROPOSAL

The lower house of the parliament on 13 May voted down a proposal to re-introduce polygamy, in accordance with Islamic law, ITAR-TASS reported. "We want to be a civilized country not only of an Asian but also of a European type," a parliament statement said. BP

TRANSNATIONAL COMPANY SUES KAZAKH GOVERNMENT

A transnational corporation is suing the Kazakh government for breach of contract, ITAR-TASS reported on 14 May. The Toronto-based World Wide Minerals corporation--which is also registered in the U.S., where it has filed suit--signed a contract to mine and process uranium ore in the Stepnogorsk region. The corporation assumed the debts of the previous owner, a Kazakh company, and paid wage arrears and pensions to workers. World Wide Minerals planned to sell the uranium to the U.S. company Consumers Energy but claims it has lost $220 million because the Kazakh government has failed to grant it an export license. BP




UKRAINIAN FOREIGN MINISTER OPPOSES 'POLITICIZING' CIS...

Borys Tarasyuk told a news conference in Kyiv on 13 May that Ukraine opposes "the transformation of the CIS into a supra-state structure," ITAR-TASS reported. "If the process of reorganizing the CIS takes on a politicized character..., the commonwealth will be doomed," the minister commented. He also stressed that Russia "has been, is, and will remain a priority in Ukraine's foreign policy." In Tarasyuk's opinion, Ukraine has managed to create a "belt of good-neighborliness and stability" with its neighbors and is now going to take a "more pragmatic course" toward seeking new markets. JM

...STRESSES CLOSE COOPERATION WITH NATO, EU

The foreign minister also announced that Ukraine will seek close cooperation with NATO. In his opinion, the Ukrainian Constitution does not rule out joining the alliance but "certain conditions should emerge" toward this step. The foreign minister expressed the hope that Ukraine will be able to sign an agreement on associated membership in the EU this year. According to Tarasyuk, Ukraine's relations with the EU are "constructive." JM

CHORNOBYL REACTOR TO BE OPERATIONAL SOON

Operators at the Chornobyl nuclear plant have begun restarting the plant's only functioning reactor, Reuters reported on 13 May. The reactor was switched off last year for nine months to repair more than 300 cracks in its cooling system pipes. The plant's chief engineer told the news agency that the reactor currently has no defects and will be brought to its full operational capacity by 18 May. JM

BELARUS REPORTS 12 PERCENT ECONOMIC GROWTH

The Belarusian Ministry of Statistics and Analysis has reported that GDP increased by 12 percent from January through April compared with the same period last year. Investments in fixed assets grew by 39.5 percent, while consumer prices rose by 14.8 percent compared with 28.8 percent last year. JM

MINSK TO INTRODUCE LICENSES FOR DISSEMINATING GOVERNMENT INFORMATION

The Justice Ministry has approved the procedure for the introduction of licenses for disseminating official government information, RFE/RL's Belarusian Service reported on 13 May. Such information is defined as any presidential or ministerial law, decree, or directive issued in print or electronic form. Theoretically, any citizen or legal entity is eligible to obtain the license, but this step requires voluminous supporting documentation. Those exempt from such licenses include publications with a circulation of fewer than 300 copies or those whom the Justice Ministry describes as "acknowledged as official in accordance with an established procedure." JM

ESTONIA ANNOUNCES COMMISSION TO INVESTIGATE NAZI, SOVIET CRIMES

President Lennart Meri told journalists on 13 May that Tallinn will form a commission to investigate crimes against humanity committed in the country between 1939 and 1991. That announcement follows the summit in Riga at which the three Baltic presidents agreed to set up such commissions in each country (see "RFE/RL Newsline," 13 May 1998). Meri said that the decision was prompted by recent events in Latvia: "Certain forces that are not interested in the Baltic States' stability are manipulating some tragic incidents in our past and are using [them] against us." The commission will aim to bring to justice any war criminals living in Estonia. Representatives of the American Jewish Committee have advised Meri on the setting up of the commission. JC

BALTIC COUNCIL HEAD URGES LATVIA TO AMEND CITIZENSHIP LAW

Ole Espersen, commissioner of the Council of the Baltic Sea States, has urged the Latvian parliament to approve by July government-proposed amendments to the citizenship law, BNS reported. Speaking to reporters in Riga on 13 May, Espersen said that lawmakers should also bring the labor code and the state language bill into line with international norms. The same day, presidential press secretary Sergei Yastrzhembskii told ITAR-TASS that Moscow expects from Riga "tangible steps" toward legislative guarantees of the rights of ethnic Russians, adding that "we shall continue with our steps." Yastrzhembskii was commenting on the Riga summit of the three Baltic presidents. JC

LITHUANIAN SECURITY CHIEF RESIGNS

ITAR-TASS reported on 13 May that Jurgis Jurgelis, the director- general of Lithuania's State Security Department, submitted his resignation during a meeting that day with President Valdas Adamkus. The meeting was initiated by the president, who accepted Jurgelis's resignation, Adamkus's press service said in a statement. Observers link the security chief's departure to the failure to find those responsible for the series of explosions in Lithuania over the past six months. JC

POLISH PRESIDENT REFUSES TO CONDEMN COMMUNIST PAST

In an interview published in "Rzeczpospolita" on 14 May, Aleksander Kwasniewski refused to condemn Poland's Communist era. In his opinion, the Communist past was too complex to be described in "one [condemning] sentence or one paragraph.... It was a period when some people were loving one another, some were being held in prison, some were working, and some were wasting their talents because they had no possibilities for self-development." Kwasniewski added that the collapse of the Communist system was the best assessment of the Communist era. Current attempts to pass a bill condemning the Communist past are aiming at dividing the Polish society "into good and bad people," he argued. JM

HAVEL RELEASED FROM HOSPITAL

President Vaclav Havel was released from Prague's military hospital on 13 May, CTK reported. His spokesman said Havel will rest for a week to 10 days at the presidential residence at Lany, outside Prague. MS

AUDIT SHOWS KLAUS'S PARTY BROKE FUNDING LAWS

The Civic Democratic Party (ODS) of former Premier Vaclav Klaus failed to abide by donation disclosure laws and rigged its own accounts, according to an international external audit carried out by Deloitte & Touche at the ODS's request. ODS representatives told journalists on 13 May that the party had altered accounts, concealed donations from companies and individuals by using false names, and had employed poor accounting methods. At the same time, the auditors found no evidence of the foreign bank accounts that were alleged to exist and led to Klaus' resignation in November 1997. The ODS said in reaction that it would improve the internal financial control and "pay anything due to the public coffer," Reuters reported. It also said it has already been punished by losing control of the government and a significant share of popular support. MS

SLOVAK SPEAKER REFUSES TO ACCEPT PETITION

Ivan Gasparovic on 13 May refused for the second consecutive day to accept petitions collected by the opposition in favor of direct presidential elections. A spokesman for the Slovak legislature told RFE/RL that the petitions are stacked in numerous boxes and must be first handed to a parliamentary committee to determine their authenticity. Some 400,000 Slovaks are reported to have backed the drive for direct presidential elections. On 12 May the parliament began debating the amendment of the electoral law proposed by the ruling Movement for a Democratic Slovakia. The opposition says the modified law discriminates against it. MS

BUDAPEST BOURSE SLUMPS AFTER FIRST ROUND OF ELECTIONS

Prices at the Budapest stock exchange fell sharply on 13 May for the third day in a row in what analysts say is a nervous reaction to the strong showing of right-wing parties in the first round of the elections, AFP reported. The BUX has lost 729 points (almost 8.5 percent) since 8 May, the last day of trading before the ballot. Experts say the market is likely to remain unstable until after the 24 May run-off. Prime Minister Gyula Horn on 13 May said his Socialist party cannot and will not change its electoral program. He also said that he was surprised by the low turnout in the first ballot and that his party will concentrate much of its effort in the two counties where the 10 May ballot will have to be repeated owing to a turnout of less than 50 percent. MS




CLINTON PRAISES MILOSEVIC-RUGOVA AGREEMENT

U.S. President Bill Clinton said in Berlin on 13 May that the decision by Yugoslav President Slobodan Milosevic and Kosovar shadow-state President Ibrahim Rugova to meet in Belgrade on 15 May is a "sober first step" toward a resolution of the Kosova question (see "RFE/RL Newsline," 13 May 1998). In Washington, Secretary of State Madeleine Albright praised Milosevic's "personal engagement" and Rugova's "flexibility" in agreeing to the talks. In Moscow, Foreign Minister Yevgenii Primakov called the agreement "a significant achievement for which Russian, U.S., French, and German diplomats and the entire Contact Group have worked," Interfax reported. German Foreign Minister Klaus Kinkel stressed that Germany has a "special interest" in obtaining a quick end to the crisis because it is host to 150,000 Kosovar asylum seekers, the "Frankfurter Allgemeine Zeitung" wrote. The Foreign Ministries of the U.K., France, Italy, and Albania issued statements welcoming the two leaders' decision to meet. PM

KOSOVARS COOL TO RUGOVA'S CHOICE

Fehmi Agani, who is a close adviser to Rugova and the head of the Kosovars' Group of 15 negotiators, praised Rugova's decision to meet Milosevic without any foreign mediators present. He added that "no miracles" should be expected from the meeting. Also in Prishtina on 13 May, Adem Demaci, the head of the opposition Parliamentary Party of Kosova, said that Rugova's move was "a capitulation." Demaci added that Rugova had abandoned the Kosovar demands for independence in favor of "cultural autonomy," the Kosova Information Agency (KIC) reported. Social Democratic leader Luljeta Pula-Beqiri called Rugova's decision "scandalous" and added that "the people are against it," "Nasa Borba" wrote. The VOA's Albanian Service reported that "The discontent of all the [G-15] members was apparent. They did not feel like commenting on the...meeting." Also in Prishtina, Rugova failed to show up for a scheduled session of the executive board of his Democratic League of Kosova. PM

MORE DEATHS IN KOSOVA

"The Guardian" on 13 May quoted an unnamed representative of the Kosova Liberation Army (UCK) as saying that "I don't trust [U.S. special envoy Richard] Holbrooke" and that "the UCK will free the people...[including] the Albanians in Montenegro and Macedonia." In the main crisis regions of Kosova, some 18 people died in the past two days as a result of continued violence, KIC reported. In one incident alone, 10 Kosovars died when they entered a mine field near Ponoshec in order to circumvent a Serbian police patrol. PM

CONTACT GROUP TO MEET

U.S. special envoy Robert Gelbard said in Belgrade on 13 May that at the 15 May summit in Birmingham, England, he will brief the G-8 nations on Kosova. He said that "we also are seeking an urgent meeting of the Contact Group at the beginning of next week to review the situation and measures the Contact Group has taken in previous meetings in view of new developments." Gelbard noted that the U.S. is also engaged in urgent consultations with the Organization for Security and Cooperation in Europe, including with Spanish former Prime Minister Felipe Gonzalez, whom the OSCE has designated as its representative in the Kosova crisis. Gelbard added that "the United States continues to feel that it is extremely important for the Gonzalez mission to get under way so as to formulate the appropriate means by which [Milosevic's Yugoslavia] will enter the OSCE." PM

NATO TO PREPARE OPTIONS ON KOSOVA

An unnamed NATO spokesman told Reuters in Brussels on 13 May that the ambassadors of the member states of the Atlantic alliance welcome the announcement of the Milosevic- Rugova meeting and the fact that Milosevic has accepted "personal responsibility" for resolving the Kosova question. The spokesman added that the ambassadors asked expert committees to prepare a wide range of contingency plans for dealing with the crisis. Issues under consideration include ways of helping Albanian and Macedonia, which the spokesman called "front-line states." PM

DJUKANOVIC TO THWART MILOSEVIC'S MOVE AGAINST HIM

Milica Pejanovic-Djurisic, who heads Montenegrin President Milo Djukanovic's Democratic Socialist Party (DSS), said in Podgorica on 13 May that the DSS has asked the speaker of the Montenegrin parliament to call a special session to rule on how to defend Montenegro's interests within the Yugoslav federation, RFE/RL's South Slavic Service reported. Her move is aimed at recalling Montenegrin members of the federal legislature in Belgrade back to Podgorica for the special session so that there will be no quorum in the federal upper house on 18 May. On that date, the federal legislators are slated to vote on unseating Prime Minister Radoje Kontic and replacing him with a Milosevic supporter (see "RFE/RL Newsline," 13 May 1998). PM

ARREST WARRANT FOR BOSNIAN SERB EX-LEADER

Spokesmen for the Interior Ministry of the Republika Srpska announced in Banja Luka on 13 May that the ministry has issued a warrant for the arrest of Gojko Klickovic, a former prime minister and a loyalist of Radovan Karadzic. Klickovic is wanted for embezzlement and abuse of office. Unspecified decisions by Prime Minister Klickovic led to the disappearance of some $4 million from the state budget. Serbian press reports suggest that Klickovic is in Yugoslavia. PM

NANO'S STOLEN CAR TURNS UP IN MONTENEGRO

Police spokesmen said in Tirana on 13 May that two men have been arrested in conjunction with the recent hijacking of Prime Minister Fatos Nano's car (see "RFE/RL Newsline," 7 May 1998). Tirana dailies added that the armored Mercedes limousine, which is readily identifiable by its license plates, was taken to Montenegro. The press reports noted that gangs have stolen "hundreds" of Mercedes cars in recent months and smuggled them into Montenegro. PM

ROMANIAN PARLIAMENT DEBATES BUDGET

A joint session of the two chambers of the parliament began debating the 1998 budget on 13 May, RFE/RL's Bucharest bureau reported. Prime Minister Radu Vasile said the budget aims at reducing inflation to 45 percent (151.4 percent in 1997). It forecasts a deficit of 3.6 percent of GDP, which is expected to register zero growth (minus 6.6 percent in 1997). Unemployment is expected to rise to 11.2 percent, from 9.5 percent last year. The opposition parties, with the exception of the Party of Romanian National Unity (PUNR), have announced they will vote against the budget. The PUNR says it will vote in favor only if its proposed amendments are accepted, which is unlikely. MS

FOREIGN DIPLOMATS INVOLVED IN CIGARETTE SMUGGLING AFFAIR

Nicolae Alexandru, chairman of the Senate's Defense Committee, on 13 May said foreign diplomats accredited in Bucharest are involved in the "cigarette smuggling affair" (which the Romanian media is now calling "Otopeni-gate" in reference to Bucharest airport). Alexandru, a member of the Democratic Party, added that people close to the "sphere of power" are also involved in the affair. He provided no other details but said that most of the foreigners involved in the scandal come from "the Arab world." Meanwhile, the Bucharest Military Tribunal has ordered the release from detention of General Gheorghe Florica, former chief of the Financial Guard, for "lack of evidence" on his alleged involvement in the affair. The Prosecutor-General's Office has appealed that decision. MS

AGREEMENT REACHED ON MOLDOVAN GOVERNMENT REFORM

Premier-designate Ion Ciubuc and the governing Alliance for Democracy and Reform have reached agreement on reforming the government, BASA-press and Infotag reported on 13 May. The new government will have 13 ministers, three of whom will be deputy premiers. The portfolios will be divided according to the "2+2+1 formula" agreed on last month by the three members of the coalition alliance. According to that formula, the Party of Democratic Forces will have one minister for every two cabinet members who belong to the Democratic Convention of Moldova (CDM) and to the For a Democratic and Prosperous Moldova Bloc. Several ministries will be merged. Also on 13 May, CDM co-chairman Mircea Snegur said the alliance can "under no circumstances" agree to President Petru Lucinschi's and Ciubuc's intention to offer government posts to members of Ciubuc's outgoing cabinet. MS

KOSTOV OPPOSES SANCTIONS AGAINST YUGOSLAVIA

Prime Minister Ivan Kostov, in an interview with Reuters on 13 May, said the sanctions imposed earlier on Yugoslavia helped turn Bulgaria into what he described as a "country of corporate and oligarchic interests." Kostov said the embargo created the background against which huge illegal fortunes could be made through arms, oil, and other trade with Serbia. The reintroduction of those sanctions would benefit only those Bulgarian forces against which his government has "won its great battle" in the struggle to combat corruption. MS

WORLD BANK APPROVES BULGARIAN LOAN

The World Bank has approved a $16 million loan to Bulgaria for a pilot project to clean up a copper refining plant, an RFE/RL correspondent in Washington reported. The MDK copper smelter plant, located in the vicinity of Plodviv and Zlatitsa, has been pouring tons of toxic waste from its acid plant into a lagoon for many years. It is now leaking and threatening to overflow or break a dam. In such a case, waste would enter the Topolnitsa reservoir, which is the main source of drinking water for Plodviv. MS




THE COMING GENERATIONAL SHIFT


by Paul Goble

Many post-Soviet states are now confronting a problem that some of their leaders thought they could put off dealing with or even avoid: how to transfer power from one generation to another in a way that does not compromise stability, independence, and national aspirations.

Both the problem and the different ways national leaders are addressing it have been thrown into relief by two recent events: Russian President Boris Yeltsin's renewal of his government last month and Azerbaijani President Heidar Aliev's 75th birthday celebrations on 10 May.

In the Russian Federation, Yeltsin sacked his longtime prime minister, Viktor Chernomyrdin, a man of his own generation and hence of longtime Soviet experience. In his place, Yeltsin installed Sergei Kirienko, someone a generation younger who came of age in the post-Soviet world. And the Russian president has advanced the careers of a number of other young reformers.

Many in Russia and abroad have greeted this move. Not only does it suggest that Yeltsin is prepared to push further and faster on reform than Chernomyrdin was doing, but it also allows a new group of officials to gain the kinds of experience that will make them credible as candidates for more senior positions, including eventually the one that Yeltsin now occupies.

But others in both places have been more skeptical. On the one hand, Yeltsin is likely to have far more influence over Kirienko than he sometimes had over Chernomyrdin. And because Yeltsin has proved so changeable over time, his influence may push Kirienko's government in very different directions than some now hope and others fear.

And on the other, the sacking of Chernomyrdin may have cleared the way for Yeltsin to run for yet another term as president if his health holds up. While in office, Chernomyrdin had gained the kind of experience that made him plausible as a successor to Yeltsin. Kirienko does not yet have that experience and consequently does not appear a likely candidate.

There thus appear to be two possibilities: either Yeltsin runs again, despite an apparent constitutional prohibition against a third term, or the candidates for that office will likely have little or no experience in the post- Soviet Russian central government, a situation that could adversely affect future developments there.

In Azerbaijan, by contrast, Aliyev has not yet begun this process of renewing elites, even though it is quite obvious that the issue of transferring power to a younger group of leaders while maintaining the stability and independence of his country is now very much on his mind.

But because of his age, Aliev's failure to push this process further could call into question the very achievements he is most interested in guaranteeing: removing Russian troops from his country, attracting sizable Western investment, and helping build the economic and political bridge between Central Asia, Georgia, Ukraine, and the West.

Indeed, even as leaders from around the region and the world greeted him on his 75th birthday, Aliyev appeared particularly unwilling to explore ways in which he could renew his own regime and guarantee that his achievements will survive their creator.

Last month, Aliyev proposed new legislation to regulate the October presidential elections. Because of its restrictive provisions which appear to give the incumbent unfair advantages, five leading members of the opposition issued a joint declaration that they would refuse to run if the law were adopted.

Even more problematic than this declaration of the five, Azerbaijani police dispersed a demonstration of some 400 people protesting the legislation in Baku late last week and arrested more than 100. Among those taking part and possibly among the arrested were former government officials and opposition activists.

The lack of any bridge between Aliyev and these people or of a means of including at least some of the social forces they represent in the government suggests that the transition after Aliyev could be a very rocky one.

Despite the steps he has taken, Yeltsin has not yet solved this problem. Indeed, if he uses Kirienko's lack of experience to keep himself in office, Yeltsin may make matters worse. But Aliev's approach until now is a reminder that failing to address the problem head on is not a solution but rather a guarantee that the problem itself will become even more pressing.


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