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Newsline - June 18, 1998




YELTSIN SAYS CHUBAIS'S APPOINTMENT IS 'TEMPORARY'

President Boris Yeltsin on 18 June said his appointment the previous day of Unified Energy System chief executive Anatolii Chubais as presidential envoy to international financial institutions is a "temporary" measure, Russian news agencies reported. Yeltsin cautioned journalists against drawing "unnatural conclusions" from the appointment, Interfax reported. Chubais will keep his job at the electricity monopoly. In a speech to the second annual St. Petersburg Economic Forum on 17 June, Prime Minister Sergei Kirienko warned that the government's "anti-crisis program" will be "tough" and "unpopular," RFE/RL's correspondent in St. Petersburg reported. He did not disclose details about the program but said its implementation will require "courage and political will." Some observers believe that in his new position, Chubais will become a scapegoat for unpopular government policies, an RFE/RL correspondent in Moscow reported on 18 June. LB

'THIRD COMING' OF CHUBAIS DRAWS MIXED REACTION

The Russian media has viewed Chubais's appointment (his "third coming" in the words of "Kommersant-Daily") as an attempt to reassure foreign investors who have fled Russian markets during the last six weeks. Speaking to journalists in St. Petersburg on 17 June, State Duma Speaker Gennadii Seleznev charged that international financial institutions themselves initiated the appointment, Interfax reported. Seleznev expressed regret that "Western financiers continue to regard Chubais as a panacea." Duma First Deputy Speaker Vladimir Ryzhkov of Our Home Is Russia argued that Chubais's appointment will worsen the already difficult relations between the government and the Duma. He noted that the government needs the parliament's cooperation in order to adopt key economic legislation. Duma deputy Sergei Ivanenko of Yabloko viewed the latest appointment as evidence that "the government is not going to change its old habits" of cultivating crony capitalism. LB

BEREZOVSKII ON CHUBAIS, OLIGARCHS' CONTACTS WITH GOVERNMENT

CIS Executive Secretary Boris Berezovskii, who fought for months to have Chubais removed from the government, told journalists on 17 June that he supported naming Chubais as liaison with international financial groups, adding that the appointment was partly his idea, RFE/RL's correspondent in St. Petersburg reported. Commenting on the 16 June meeting between Prime Minister Kirienko and top Russian "oligarchs," Berezovskii told Interfax that the meetings are a positive "sign of consolidation of reformist forces...for overcoming the [economic] crisis." He argued that the authorities have no other base of "realistic support." ITAR-TASS on 18 June quoted Berezovskii as saying that "the Russian business elite is united" and understands that business groups "cannot afford not to coordinate their activities" during the crisis. Although Berezovskii claims no longer to be directly involved in business, he reportedly attended Kirienko's meeting with the "oligarchs." LB

MARKETS RISE ON FOREIGN BUYING

Share values on the Russian stock market rose 5-10 percent in early trading on 18 June amid buying by foreign traders, ITAR-TASS reported. The bond market also posted gains, as yields on government treasury bills fell by some 10 percentage points to 55-57 percent. On 17 June, the Finance Ministry canceled two auctions for six-month and 11-month treasury bills, which were to have raised a combined total of 14 billion rubles ($2.3 billion), Interfax reported. According to Central Bank First Deputy Chairman Sergei Aleksashenko, the Finance Ministry did not want to raise money through treasury bills at yields of 65 percent to 68 percent. The 'Moscow Times" reported on 18 June that the cancellation of the auctions "fueled speculation in the market that the government has found other sources of funds" to redeem more than $1 billion in maturing treasury bills. LB

FINANCE MINISTER SAYS NO GROWTH THIS YEAR

Addressing a cabinet session on 18 June, Mikhail Zadornov predicted that Russian will not achieve economic growth this year, ITAR-TASS reported. The Economics Ministry is forecasting 1998 GDP at 0.5 percent below to 0.5 percent above the previous year's figure. Zadornov also said Russia will post a budget deficit of some 14 billion rubles ($2.3 billion) in 1998, with revenues falling 5-7 billion rubles short of budget targets. Wage arrears to state employees total 6 billion to 7 billion rubles, of which the Finance Ministry owes 3 billion rubles, Zadornov noted. In a speech to the St. Petersburg Economic Forum on 17 June, Central Bank Chairman Sergei Dubinin said one-third of budget expenditures go toward debt servicing. LB

DUMA WANTS SUPREME COURT TO HAVE SAY ON PRESIDENT'S HEALTH

The Duma on 17 June passed in the first reading an amendment to the civil procedural code that would empower the Supreme Court to rule on "the ability or persistent inability of the president for health reasons to carry out his functions," ITAR-TASS reported. Article 92 of the constitution stipulates that the president's term ends early in the event of "persistent inability for health reasons" to carry out his duties, but the constitution does not establish a mechanism for evaluating the president's health. Aleksandr Kotenkov, Yeltsin's representative in the Duma, argued that the proposed amendment is unconstitutional. LB

COMMUNIST DEPUTY SUSPECTS YELTSIN HAS A DOUBLE

Duma deputy Aleksandr Salii of the Communist faction has asked the Prosecutor-General's Office to investigate the possibility that a double has been standing in for Yeltsin since the president's heart surgery in November 1996, "Moskovskii komsomolets" reported on 18 June. Rumors that a surgically-altered double has taken Yeltsin's place have occasionally surfaced in the opposition press during the last two years. Salii told "Moskovskii komsomolets" that analysis of some 1,500 photographs shows that the president's appearance changed after the 1996 presidential election. He also charged that the "new Yeltsin" frequently shows his hand with two missing fingers, whereas the president used to try to conceal that hand from public view. LB

DUMA PRAISES RUSSIAN DIPLOMACY ON KOSOVA

The Duma on 17 June passed by 332 to three votes a statement calling for a peaceful settlement of the situation in Kosova "on the basis of respect for the sovereignty and territorial integrity of the Yugoslav Federal Republic and observing the rights of the [ethnic] Albanian population," Russian news agencies reported. The statement praised the recent meeting between President Yeltsin and his Yugoslav counterpart, Slobodan Milosevic, and expressed "full support" for Russian diplomatic efforts. At the same time, the Duma criticized the "obviously biased policy of several Western countries" on the Kosova issue, adding that "the language of sanctions and threats of using force against Belgrade in effect encourage separatism" (see also Part II). LB

KIRIENKO SAYS GOVERNMENT WON'T REACT TO MINERS' PICKET

Prime Minister Kirienko told journalists on 17 June that the government will not take any steps in response to the ongoing picket of government headquarters by coal miners, ITAR-TASS reported. The miners, who came to Moscow from various regions of Russia, have been demonstrating outside the White House since 11 June. Kirienko noted that the government is prepared to discuss economic problems with the miners, but not political demands. A participant in the picket told RFE/RL's Moscow bureau on 16 June that the miners will not drop their demand for the resignations of Yeltsin and the government. Another miner who has joined the demonstration addressed the Duma on 17 June, after which deputies passed an appeal urging Yeltsin to "put the coal industry in order." LB

GAZPROM, TAX SERVICE CLASH OVER PROPERTY SEIZURES...

Regional officials of the State Tax Service have begun seizing assets and bank accounts belonging to subsidiaries of the gas monopoly Gazprom, "Kommersant- Daily" reported on 18 June. On the order of its director, Boris Fedorov, the State Tax Service recently warned more than 100,000 enterprises that their assets may be seized if they do not pay their tax debts by 1 July. The Gazprom subsidiaries Orenburggazprom and Uraltransgaz are among the first enterprises affected. According to "Kommersant- Daily," Fedorov is seeking to annul the agreement on tax payments signed by his predecessor, Aleksandr Pochinok, with Gazprom. The company's press service on 17 June slammed the "forcible extraction of debts" by the tax authorities. The same day, the Duma passed a resolution warning that the tax service's methods will harm the domestic economy and are "aimed at destroying" the country's gas supply system. LB

...AS MONOPOLY SEEKS REDUCTIONS IN VAT AND EXCISE DUTIES

Gazprom head Rem Vyakhirev on 13 June warned that the current value-added tax of 22 percent and excise duties of 30 percent threaten to "bury" Russia's gas exports to Europe, Russian news agencies reported. Vyakhirev said Gazprom will stop signing new export contracts unless the government reduces VAT and excise rates. Gazprom lost some of its political clout when its former head Viktor Chernomyrdin lost his job as prime minister in March. Last month, the government submitted to the parliament a draft law that would levy excise duties on gas at the time of delivery rather than when Gazprom collects payment. Such a law would be a disaster for the gas monopoly, which "only collects between 10 and 15 percent of its revenues from gas sales in cash," according to the "Financial Times" on 15 June. LB

THIRD SUSPECT ARRESTED IN JOURNALIST'S MURDER

Aleksandr Zvyagintsev, an aide to Prosecutor-General Yurii Skuratov, announced on 17 June that police have arrested a third man in connection with the 7 June murder of "Sovetskaya Kalmykia Segodnya" editor Larisa Yudina, Russian news agencies reported. He identified the suspect as V. Shanukov but did not provide other details. The two men previously arrested for Yudina's murder both have ties to Kalmykian President Kirsan Ilyumzhinov. Meanwhile, the Union of Journalists on 18 June announced that it will fight to ensure that "Sovetskaya Kalmykia Segodnya" can be published and distributed freely in the republic, ITAR- TASS reported. A statement issued by the union called on the State Press Committee to become one of the newspaper's "co-founders" in order to help provide for its regular publication. LB

SUSPECT IN CORRUPTION CASE ARRIVES IN RUSSIA

Andrei Kozlenok, the main suspect in a high-level corruption case, was flown from Athens to Moscow on 17 June, Russian news agencies reported. Kozlenok is to be questioned on 18 June and charged with embezzlement in connection with a scheme to sell $180 million in gemstones. He fought his extradition from Greece for five months, saying his life would be in danger in Russia. Kozlenok's former "right-hand man," another key suspect in the case, was found hanging in his Moscow jail cell in February. LB

ANOTHER AIDE TO AN LDPR DEPUTY GUNNED DOWN

Igor Klyachko, an aide to a Duma deputy from the Liberal Democratic Party of Russia, was found shot dead in St. Petersburg on 17 June, ITAR-TASS reported. A revolver, a gun permit, and several thousand U.S. dollars were found on Klyachko. According to ITAR-TASS, he was the sixth aide to a Duma deputy from Vladimir Zhirinovsky's party to be killed since November 1996. LB

AMMUNITION BLAZE WREAKS HAVOC IN SVERDLOVSK OBLAST

Fourteen soldiers have died, 17 have been injured, and more are reported missing after an explosion at a ammunition storage compound near Yekaterinburg (Sverdlovsk Oblast), Interfax reported on 18 June. The previous day, lightning set fire to the compound, setting off massive explosions and spreading across 200 hectares into surrounding forests. The head of administration of Berezovksii, the city closest to the compound, told ITAR- TASS on 18 June that 1,070 local residents were evacuated, while Interfax put the figure at1,500-2,500. BT

GREENPEACE DEMANDS INVESTIGATION INTO WATER- POLLUTION CASE

Greenpeace of Russia has sent a letter to the Prosecutor-General's Office demanding an investigation into an environmental catastrophe in Krasnoyarsk Krai, Interfax reported on 17 June. Dumping of mercury waste into the Bratskoe water reservoir (on the Angara River) by the local enterprise Usolyekhimprom has affected 500,000 local residents, Greenpeace of Russia said in a 17 June press release. The press release cites increased cancer rates as well as cases of respiratory, vascular, and urinary system diseases in nearby settlements. Mercury content in hair samples from local children allegedly exceed the regional average by 800 percent. Owing to faulty processing, the enterprise dumps 2.5 tons of mercury waste into the reservoir each month, Greenpeace claimed. BT




ARMENIAN FOREIGN MINISTER CRITICIZES BAKU'S 'INTRANSIGENCE'

Speaking at a press conference in Yerevan on 17 June, Vartan Oskanian said the Karabakh peace process is in effect deadlocked because Azerbaijan opposes changes in the Karabakh peace plan proposed by the OSCE Minsk Group, RFE/RL's Yerevan bureau reported. Oskanian said that Armenia has made a major concession by agreeing to less than total independence for the unrecognized Nagorno-Karabakh Republic and that Baku should reciprocate by abandoning its insistence on granting Karabakh only an autonomous status within Azerbaijan. Oskanian said that if the present deadlock persists for another two years, Baku will have the opportunity to strengthen its military capacity and Yerevan will be forced to strengthen its political and military commitment to the security of the Karabakh Armenian population. He added that Yerevan will consider alternative approaches to resolving the deadlock, including reunification with Karabakh. LF

GEORGIAN, RUSSIAN OFFICIALS DISCUSS ABKHAZIA

Georgian President Eduard Shevardnadze held talks in Tbilisi on 17 June with Russian special envoy for Abkhazia Gennadii Ilichev and General Sergei Korobko, the commander of the Russian peacekeeping forces deployed in Abkhazia's Gali Raion under the aegis of the CIS, Caucasus Press reported. Shevardnadze accused the Russian peacekeepers of failing to prevent the Abkhaz Interior Ministry forces from bringing heavy artillery into the conflict zone, RFE/RL's Tbilisi bureau reported. But Korobko pointed out that the peacekeepers' mandate does not empower them to intervene in hostilities. Ilichev and Shevardnadze agreed on the need to expedite the return to their homes of ethnic Georgians constrained to flee during last month's fighting. Also on 17 June, the U.S., French, British, German, and Russian ambassadors in Tbilisi were in Novy Afon for talks with Abkhaz President Vladislav Ardzinba. LF

GEORGIAN PRESIDENT SAYS HE HAS FAITH IN RUSSIAN MEDIATION

Shevardnadze told a press conference in Tbilisi the same day that "Russia can and must" speed up the process of resolving conflicts in the Transcaucasus, ITAR-TASS reported. Arguing that "it is difficult to imagine tranquillity in the North Caucasus without a stable South [Caucasus]," Shevardnadze said that he does not believe the Caucasus will become a center of confrontation between Russia and the West, despite their conflicting interests in the region. LF

AZERBAIJAN CONTINUES TO PRESSURE OPPOSITION

Police searched the editorial offices of the opposition newspaper "Chag" in the evening of 16 June and confiscated computer equipment and documents, Turan reported. The following day, police also searched the apartment of Elchin Pashaev, secretary of the United Azerbaijan Union, which is campaigning for the unification of the Azerbaijan Republic and Iranian Azerbaijan. The Azerbaijan Popular Front Party has issued a statement threatening protest actions if the authorities continue arbitrary repression of the opposition. Of the two aides to APFP chairman Abulfaz Elchibey who were arrested on 14 June (see "RFE/RL Newsline," 17 June 1998), one has been charged with illegal possession of weapons and the other with refusing to obey police orders. LF

AZERBAIJANI OPPOSITION LEADERS ANNOUNCE ELECTION BOYCOTT

Five prospective opposition presidential candidates--Abulfaz Elchibey (APFP), Lala- Shovket Gadjieva (Liberal Party of Azerbaijan), Isa Gambar (Musavat Party), Ilyas Ismailov (Democratic Party of Azerbaijan), and Rasul Guliev (non-affiliated)--issued a statement on 17 June arguing that their participation in a poll held under "reactionary laws" would be tantamount to legitimizing a dictatorial regime and tacitly condoning repression, Turan reported. They affirmed their intention to boycott the presidential election scheduled for October. They also warned that "sooner or later, all dictatorial regimes end with social upheaval." LF

AZERBAIJANI OFFICIAL CONDEMNS TURKMEN CASPIAN TENDER

Azerbaijani presidential adviser Vafa Gulu-zade told journalists on 17 June that no foreign companies should start exploiting the Kyapaz/Serdar Caspian oil field until the dispute between Azerbaijan and Turkmenistan over ownership of the oil field has been resolved, Interfax reported. Turkmenistan the previous day announced the results of a tender in which Mobil acquired the rights to that deposit, but Gulu-zade said Mobil's representation in Baku reassured the Azerbaijani leadership that it will not begin work on Kyapaz until the ownership dispute is resolved. Also on 17 June, a spokesperson for the Azerbaijan International Operating Company engaged in exploiting three offshore Caspian oil fields said the company is confident that Russia's Transneft pipeline company can ensure uninterrupted shipments of Azerbaijani oil through the Baku-Grozny-Novorossiisk export pipeline. The Chechen leadership threatened to halt the oil flow if Moscow failed to meet its outstanding financial commitments to Chechnya. LF

ANOTHER COMMITTEE FOUNDED TO INVESTIGATE KYRGYZ CYANIDE SPILL

Representatives of several Kyrgyz ecological and human rights organizations have founded a Committee to Protect the Environment, RFE/RL's Bishkek bureau reported on 17 June. The committee intends to conduct an independent investigation into the 20 May accident in which a lorry carrying 20 tons of sodium cyanide plunged into the Barskoon River. Kyrgyz parliamentary deputies and intellectuals founded a Committee to Protect Lake Issyk-Kul (into which the Barskoon River flows) on 22 May, and the parliament on 13 June voted to create an international commission to investigate the causes of the accident (see "RFE/RL Newsline," 15 June 1998). A State Customs Committee spokesman on 17 June said that the committee will sue the Kyrgyz-Canadian gold-mining joint venture whose lorry was involved in the accident for $1.44 million in unpaid customs duties. LF

TOP TAJIK SECURITY OFFICIAL SLAIN

Usmon Khodjiev, the deputy commander of the Defense Ministry's recently established special unit for protecting the UN observer force in Tajikistan, was found murdered in Dushanbe on 17 June, Interfax reported. Khadjiev was a former opposition field commander. Other former opposition fighters have issued a statement condemning the killing. LF




LUKASHENKA BACKS DOWN IN ROW OVER DIPLOMATIC RESIDENCES

The British Embassy in Minsk on 17 June announced that foreign diplomats who had been threatened with eviction from the Drazdy residential compound will remain there. The statement, which came after a meeting of five Western ambassadors with Foreign Minister Ivan Antanovich the same day, said the authorities will continue with repairs to water supply and sewage systems. Those repairs had been cited as the official reason for the eviction order in April. Reuters on 17 June quoted an IMF representative in Minsk as saying President Alyaksandr Lukashenka signed the decree permitting the diplomats to stay at Drazdy. Lukashenka had earlier hinted that he does not like having Western diplomats live close to his own residence in the compound (see "RFE/RL Newsline," 11 June 1998). JM

UKRAINIAN MINERS END STRIKE

Miners from Pavlovhrad, Dnipropetrovsk Oblast, have ended their strike following a government pledge to pay their back wages, ITAR-TASS reported on 18 June. The miners, who had marched some 600 kilometers to Kyiv to demand the payment of wage arrears, left the capital only after witnessing a payment order signed by the government. Ukrainian Television reported on 16 June that the government has signed a protocol with the Pavlovhrad miners whereby it will pay 17 million hryvni ($13 million) in current wages and allocate another 30 million to pay wage arrears. The protocol also provides for the implementation of the parliament's resolution on allocating 600 million hryvni to support the coal industry. JM

COMMUNIST LEADER NARROWLY FAILS TO BECOME SPEAKER

In the eighth round of elections for speaker of the Supreme Council, Communist leader Petro Symonenko received 221 votes, just five short of the required 226, ITAR-TASS reported on 18 June. As on previous occasions, the right-wing and centrist groups in the Supreme Council did not participate in the ballot. Also on 18 June, the legislature is to propose candidates for the next round of elections. Under house regulations, there are no limitations on the number of times the same candidate for speaker may be proposed. JM

UKRAINIAN LAWMAKERS PROTEST SUPPRESSION OF OPPOSITION PRESS

Ten Supreme Council deputies published an open letter to Prime Minister Valeriy Pustovoytenko in the 17 June "Holos Ukrayiny" requesting him "to put an end to the negative development of events in the [country's] information sphere." The deputies accused Information Minister Zinoviy Kulyk of clamping down on opposition newspapers and media critical of the current government. They pointed to "Pravda Ukrayiny," "Vseukrainskiye vedomosti," and "Polityka," whose publication was "temporarily suspended" following legal actions taken against them by the Information Ministry or administrative measures applied by tax and other services subordinated to the executive. JM

ESTONIAN PARLIAMENT STRIPS OPPOSITION LEADER OF IMMUNITY

Lawmakers on 17 June voted to strip leader of the opposition Reform Party Siim Kallas of his parliamentary immunity, ETA reported. Kallas had requested that move to allow him to appear in court in connection with a $10 million affair dating from 1993, when he was head of the Bank of Estonia (see "RFE/RL Newsline," 26 May 1998). The Central Investigation Bureau wants to charge Kallas with abuse of power, intention to embezzle funds, and submitting false data. Kallas denies all those charges. Also on 17 June, the parliament passed a supplementary budget totaling 283.9 million kroons ($18.9 million), part of which will be used to compensate depositors at the recently liquidated Rural Bank. The additional budget was agreed on last December to distribute funds earned from the sale of state property. JC

LATVIAN PRESIDENT WANTS LAWMAKERS TO HOLD EXTRAORDINARY SESSION

Guntis Ulmanis has backed the Democratic Party Saimnieks's initiative to convene an extraordinary session of the parliament to consider amendments to the citizenship law in the third and final reading (see "RFE/RL Newsline," 17 June 1998), BNS reported. Ulmanis criticized the failure of the coalition parties to reach agreement on the amendments. If the parties are unable to agree on the issue, "no president can help," he commented. But Ernests Jurkans, head of the Saimnieks parliamentary group, told journalists if the amendments to citizenship law are not adopted, Saimnieks plans to meet with the president to consider further steps. In other news, lawmakers have voted to keep capital punishment in the new penal code in the second reading of that document. JC

COMMISSION WANTS BRAZAUSKAS TO TESTIFY ON SURVEILLANCE

A Lithuanian parliamentary commission investigating alleged spying on top officials by one of the country's security services has invited former President Algirdas Brazauskas to testify about possible spying on him, BNS reported on 17 June. Brazauskas recently told "Lietuvos Rytas" that during his tenure as president, he had felt at times that he was under surveillance. "Certain words or even entire sentences that I said in my office were quoted in conversations with other officials," Brazauskas said. Earlier, the commission had informed the parliament that it had not found sufficient evidence that high-ranking state officials had been subject to surveillance. The scandal emerged following press reports that the Third Department of the Interior Ministry had spied on the country's top leaders (see "RFE/RL Newsline," 26 May and 28 May 1998). JC

TRAIN DRIVERS' STRIKE DISRUPTS RAILROAD TRAFFIC IN POLAND

According to the Polish State Railroads (PKP), the train drivers' strike has halted some 60 percent of freight trains and 30 percent of passenger trains (see "RFE/RL Newsline," 17 June 1998). The PKP estimates its daily losses at 11 million zlotys ($3.1 million). Jan Zborowski, head of the Trade Union of Train Drivers, says he expects some 70 percent of trains to be halted on 18 June, "Gazeta Wyborcza" reported. Prime Minister Jerzy Buzek has declared the strike unlawful. Meanwhile, the Ministry of Transportation has begun negotiations with the train drivers' trade union, which belongs to the left-wing National Trade Union Alliance. JM

CZECH ELECTION CAMPAIGN ENDS

The election campaign officially ended on 17 June. Ballot stations open on 19 June and will close the following day, when preliminary results are also expected. Milos Zeman, the chairman of the Social Democratic Party (CSSD), which is most likely to win the elections, ended his campaign in northern Moravia. Former Prime Minister Vaclav Klaus, leader of the Civic Democratic Party (ODS), and his former deputy, Jan Ruml, who now heads the rival Freedom Union, held rallies in Prague. The ODS ended its campaign with a strong warning on posters and in the press against a " return to totalitarianism" if the CSSD wins the elections (see also "End Note" below). MS

HUNGARY'S SMALLHOLDERS NOMINATE MINISTERS

The parliamentary group and leadership of the Independent Smallholders' Party (FKGP) on 17 June nominated the party's four candidates for ministerial posts in the new coalition government. Party chairman Jozsef Torgyan is the candidate for the post of minister of agriculture and provincial development, Janos Szabo for defense minister, and Pal Pepo for environment minister. The FKGP also nominated Imre Boros as minister without portfolio responsible for coordinating the distribution of EU funds in Hungary. MSZ




NATO CONTINUES TO DRAW UP CONTINGENCY PLANS FOR KOSOVA

In Moscow on 17 June, Russian Foreign Minister Yevgenii Primakov rejected Western criticism of the previous day's joint declaration between Yugoslav President Slobodan Milosevic and his Russian counterpart, Boris Yeltsin (see "RFE/RL Newsline," 17 June 1998). Primakov called the declaration the best agreement possible under present circumstances. NATO Secretary- General Javier Solana noted in Vilnius that the Western allies are growing increasingly tired of the failure of Milosevic to back up his promises with deeds. A spokesman for British Prime Minister Tony Blair said in London that "one of the lessons of Bosnia is that you cannot rely on [Milosevic's] word, so we will be pressing ahead with [NATO] preparations." NATO spokesmen said in Brussels that planners are moving quickly to prepare contingency plans for Kosova. PM

GELBARD SAYS MORE EXERCISES TO COME

Robert Gelbard, U.S. special envoy for the former Yugoslavia, said in Washington on 17 June that NATO will conduct additional military exercises in the Balkans to follow up on the success of operation Determined Falcon over Macedonia and Albania earlier this week (see "RFE/RL Newsline," 15 June 1998). He added that the international Contact Group will meet soon to discuss the crisis in Kosova. PM

MONTENEGRIN LEGISLATORS BLOCK MILOSEVIC...

The Montenegrin parliament on 17 June appointed 20 supporters of President Milo Djukanovic to represent Montenegro in the 40-member federal Yugoslav upper house, "Nasa Borba" wrote. Milosevic now lacks a two- thirds majority to change the constitution and will not be able to increase his presidential powers at the expense of Serbia and Montenegro. Former Montenegrin President and current federal Prime Minister Momir Bulatovic slammed the decision to exclude representatives of his Socialist People's Party from the upper house as "a new act of secession," the "Financial Times" reported. FS

...THREATEN TO WITHDRAW SOLDIERS FROM KOSOVA

The Montenegrin parliament on 17 June passed a resolution demanding that Milosevic immediately end the violence in Kosova and meet the demands by the international Contact Group aimed at resolving the conflict in the province. The resolution demands that if Milosevic does not do so, the Yugoslav army must withdraw all Montenegrin troops from Kosova and send them to barracks in Montenegro or Serbia proper. The parliament also decided to send a delegation to Kosova to inspect the barracks in which Montenegrin soldiers are serving and called on the Montenegrin government to conduct a policy that "prevents armed clashes with forces of the international community and that ensures the protection of the territory of Montenegro from possible attacks by international forces." Djukanovic and key members of his government have repeatedly said that Podgorica wants no part of a war in Kosova. FS

HUNGARY WANTS VOJVODINA CONSCRIPTS OUT OF KOSOVA...

Hungarian Foreign Ministry spokesman Gabor Horvath told journalists on 17 June that ethnic Hungarian soldiers from Vojvodina should not be ordered to Kosova and that those already there should be withdrawn. Horvath noted that ethnic Hungarian leaders in Vojvodina have said that more than 300 ethnic Hungarians are already on duty in the province. "This practice unavoidably results in tensions between Yugoslavia's minorities," he said, adding that Hungarian diplomats have raised the issue with Belgrade and also with EU and U.S. officials. Horvath noted that many Vojvodina Hungarians fear that the conflict in Kosova could lead to a fresh exodus of refugees from Vojvodina, as happened during the 1991-1995 Croatian and Bosnian wars. MSZ/PM

...AS DO VOJVODINA PARENTS

Parents of conscripts from Vojvodina who are serving in Kosova agreed at a meeting in Novi Sad on 17 June to combine efforts with parents' groups from elsewhere in Serbia to oppose the war in Kosova (see "RFE/RL Bosnia Report," 17 June 1998). The parents demanded that the army transfer all Vojvodina conscripts in Kosova back to barracks in Vojvodina within 48 hours, RFE/RL's South Slavic Service reported. One father asked why his son had to go to Kosova when Milosevic does not send his own son there, "Nasa Borba" reported. Nenad Canak, who heads the League of Social Democrats of Vojvodina, was one of the organizers of the parents' meeting. PM

CROATIAN OPPOSITION INTRODUCES NO-CONFIDENCE MOTION

Representatives of six opposition parties submitted a motion of no confidence against the government in the parliament on 17 June, RFE/RL's South Slavic Service reported. The text noted that "a great majority of Croats live in difficult social circumstances" and singled out pensioners, the unemployed, and those who are employed but have not been paid as key hardship groups. The government has a majority in the parliament and can block passage of the resolution. Social tensions have increased since the end of the Krajina war in 1995 and the introduction of a new value-added tax earlier this year. PM

MONTENEGRO SAYS ZAGREB'S APPROACH BETTER THAN BELGRADE'S

Montenegrin Foreign Minister Branko Perovic said in Podgorica on 17 June that Croatia's recent proposal to resolve the dispute between Yugoslavia and Croatia over the Prevlaka peninsula is particularly welcome in view of Belgrade's failure to offer any ideas of its own. Perovic added that the Croatian document goes far to promote good relations and an improved standard of living on either side of the border and is thus also in Yugoslavia's best interest. Prevlaka, currently under UN administration, is part of Croatia but controls access to Kotor Bay, which is Yugoslavia's only deep-water naval base. Montenegro's reformist government is anxious to normalize relations with Croatia as part of its program of opening up to the outside world and reviving its key tourist and shipping industries. PM

ALBANIAN PARLIAMENTARY SPEAKER TAKES JOURNALISTS TO COURT

Skender Gjinushi on 17 June filed slander charges against Astrit Patozi, who is the editor-in-chief of "Rilindja Demokratike," and another journalist from the same newspaper. "Rilindja Demokratike," which is the organ of the opposition Democratic Party, had published an article claiming that the other accused journalist received $120,000 from a manager of the failed VEFA pyramid investment scheme. Socialist Party Secretary-General Pandeli Majko has said he will file charges against Patozi because "Rilindja Demokratike" published allegations that Majko received $240,000 from unspecified pyramid schemes, ATSH reported. "Rilindja Demokratike" repeated its allegations against both politicians on 18 June. Chief pyramid scheme investigator Farudin Arapi declined to comment on the charges. FS

TWO MORE ROMANIAN POLITICIANS ADMIT SECURITATE LINKS

Prime Minister Radu Vasile has asked Minister of Health Francisc Baranyi to resign and Baranyi's Hungarian Democratic Federation of Romania (UDMR) to nominate someone to replace him, RFE/RL's Bucharest bureau reported on 17 June . The demand came after Baranyi admitted to having been recruited as an informer of the former secret police 40 years ago. He said he was forced to do so "at gun point" and never provided any information to the Securitate. The same day, National Peasant Party Christian Democratic (PNTCD) deputy chairman Vasile Lupu admitted that he agreed to provide information on "people who threaten national security" but said he signed no pledge and never provided any information. The admissions come as the Senate is approaching the end of its debates on a law that would allow access to the files of the former Securitate. MS

ROMANIAN COALITION IN CONFLICT OVER BILL ON STATE FARMS AGENCY

Senators representing the PNTCD and the UDMR walked out of a 17 June debate on a bill submitted by their coalition partner, the Democratic Party, and the opposition parties. The bill would set up a National Agency of State Farms. The PNTCD and the UDMR say the bill would sabotage the return of agricultural land to its former owners and accuse the Democrats of acting against the coalition agreement. In other news, an IMF mission on 17 June began talks with Romanian officials on the evaluation of Romania's economic performance and a new stand-by agreement for 1998-1999. Chief IMF negotiator Poul Thompsen is expected in Bucharest at the end of this week. MS

IMF READY TO RESUME LOANS TO MOLDOVA

The IMF is ready to resume lending to Moldova in October if Chisinau implements an austerity program agreed on by the two sides after negotiations, Oleh Havrilyshin, deputy director of the IMF department for former Soviet states, told journalists in Chisinau on 17 June. Havrilyshin said the agreement stipulates that the austerity program will be implemented in the coming months, enabling the IMF to release a $28 million tranche in October, Reuters reported. He added that the successful implementation of the program would also make it possible for the World Bank to resume financing and that the IMF would release another $100 million in 1999. MS

BULGARIAN OPPOSITION PARTY WANTS DEBATE OVER KOSOVA

The main opposition Socialist Party is demanding a debate in the parliament on Bulgarian's position on the conflict in Kosova, RFE/RL's Sofia Bureau reported on 17 June. In a declaration issued earlier this week, the Socialists said several Bulgarian officials are "displaying enthusiasm" over the possibility of Sofia's "becoming involved" in a military confrontation over Kosova. The Socialists want the legislature to repeat a 1993 declaration saying Bulgaria will not become involved in military confrontations in the former Yugoslavia, "either directly or under the auspices of the UN." Also on 17 June, refinery workers at the Plama refinery who went on strike on 15 June over unpaid wages said they may demand that their colleagues who help prevent industrial waste from spilling into the River Pleven, the main water source for the area, walk off the job. MS

COUNCIL OF EUROPE CONCERNED ABOUT RACISM IN BULGARIA, SLOVAKIA

In a report issued on 17 June, a Council of Europe commission said it is concerned about racism in Bulgaria, Slovakia, and several other European countries. The European Commission Against Racism and Intolerance said that Bulgaria "lacks structures and policies to deal with racism and intolerance" and that the treatment of Roma in Bulgaria is particularly worrying. The report says Roma face discrimination in Slovakia as well, particularly in jobs, housing, health care, and education. It adds that Slovakia's ethnic Hungarians face discrimination, particularly in restrictions imposed on the use of their mother tongue. MS




LITTLE HOPE AMID GLOOM IN RUN-UP TO CZECH ELECTIONS


by Breffni O'Rourke

The Czech Republic goes into parliamentary elections on 19-20 June amid widespread gloom. The economy is moribund, and chances are considered negligible that voting will produce a strong government to tackle the general malaise.

One thing is striking in this rather somber landscape. The presence of former Prime Minister Vaclav Klaus is pervasive. Klaus, driven from office when his coalition collapsed late last year amid recriminations of arrogance, incompetence, and corruption, has not faded from the political scene as expected. Klaus, the architect of Czech reform, has re-emerged as a central figure in the pre- election campaign.

A Czech affairs specialist at RFE/RL, Jefim Fistein, says Klaus's survival is "absolutely phenomenal." He notes that "all the opposite predictions proved false, and the reason for this is that what Klaus really succeeded in doing was building what you could call a people's party, a party that has deep roots in the Czech population and that has a very large net of local organizations and very many dedicated people".

Since the collapse of the Klaus minority coalition government in November, the country has been led competently enough by a government of technocrats under Prime Minister Josef Tosovsky, a quiet, former central banker. The non-political interregnum is presumably about to end, but Fistein says prospects that the politicians will be able to put together a strong government after the election appear nil: "It's absolutely impossible because the divisions in the Czech population are deep and already sufficiently crystallized for one to say that the changes in voting patterns will be small. That is to say, about half the Czech population are left-wing, and about half are right- wing."

Pre-election opinion polls indicate the strongest single party is the leftist Social Democrats (CSSD), led by Milos Zeman, which could take about 25 percent of the votes. Not far behind is Klaus's Civic Democratic Party (ODS), with just over 20 percent voter support--a remarkable showing, considering the ODS split after Klaus's fall from office.

These two main parties, however, are not expected to gain enough votes to govern on their own. Some see the best chance for stability in the short term as the formation of a grand coalition between the two, despite the fact that both parties say they do not want that. Such a coalition could provide the opportunity for a reform of the electoral system, a change widely viewed as necessary if future elections are to produce clear winners instead of political gridlock.

But if Klaus and Zeman do not form a grand coalition this time, the stage is set for messy negotiations between bigger and smaller parties and a key role for President Vaclav Havel in those talks. Some of the minor parties have pledged not to work with one another, which will complicate the issue. The two "untouchables", considered unfit to be full coalition partners, are the Republicans on the far right and the Communists on the left. But the Communists might yet have a role to play: one possible scenario is a minority administration led by the CSSD but with additional support in the parliament from the Communists.

In the prosperous Czech capital, optimism comes easier than in the provinces. The city has full employment and the highest average wage. But for many people outside the capital, there's gloom over falling real wages and increasing unemployment, results of an economy stagnating because the politicians are unable to provide direction, decisiveness, and security.

Nearly a decade after the Velvet Revolution, economic transition remains incomplete, despite the hard reformist rhetoric of the Klaus years. Who can get the economy working again, and bring the prosperity the country is certainly capable of producing? That question is not likely to be answered by this weekend's elections. The author is an RFE/RL senior correspondent.


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