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Newsline - February 2, 1999




DUMA TO REJECT PRIME MINISTER'S PEACE PROPOSAL

Prime Minister Yevgenii Primakov met with State Duma Chairman Gennadii Seleznev on 2 February to discuss Primakov's proposal for a political peace treaty between Russia's executive and legislative branches. "Kommersant-Daily" predicted on 30 January that Primakov's plan has little chance of acceptance, citing the negative assessments of the proposal by Seleznev, who had declared "we do not intend to be a pushover for either the president or the government chairman." RFE/RL's Moscow bureau reported on 2 February that the Communist party has already expressed its dissatisfaction with Primakov's proposal and that Yabloko is also unenthusiastic, according to faction member and deputy Yelena Mizulina. JAC

PRIMAKOV OFFERS MINERS MORE CASH

Speaking at the All-Russia Miners Congress in Moscow on 1 February, Prime Minister Primakov pledged to double state subsidies to the coal industry from the 5.8 billion rubles ($256 million) earmarked in the current version of the 1999 budget. Primakov acknowledged that wage arrears in the industry typically build up for five months on average. "While this is primarily the fault of the employers, the state must also share some blame," he said. Primakov also called on miners and their union representatives to refrain from threatening the government and to work together to modernize the industry. Independent Miners' Union head Aleksandr Sergeev reacted favorably to Primakov's speech, welcoming his commitment to be flexible on the closure of unprofitable mines, Interfax reported. However, he noted that discontent in the coal regions of Rostov Oblast and Komi Republic remain high. JAC

GOVERNORS BLOC ATTRACTING MORE FOLLOWERS...

The election bloc of regional leaders set up by Samara Oblast Governor Konstantin Titov will have its official legal status by 15 February, Titov told reporters on 2 February. Titov revealed that in addition to the regional leaders previously reported as interested in joining the new movement (see "RFE/RL Newsline," 29 January 1999), the governors of Sakhalin, Irkutsk and Astrakhan Oblasts are taking part in talks. "Segodnya" argued on 29 January that if the new regional bloc is "not a political false start" and regional "heavyweights" join the bloc in the future, "it may become the force that determines both the formation of the next Duma and Yeltsin's successor in the Kremlin." Krasnoyarsk Governor Aleksandr Lebed told reporters on 30 January that he will steer clear of the new alliance, saying "I will go it alone." JAC

...AS BORDER DISPUTES PREDICTED TO GATHER FORCE

"Nezavisimaya gazeta" suggested on 29 January that "the threat of separatism must be much more serious and constant than it appears to certain Moscow observers" since Prime Minister Primakov has suggested that a ban be introduced on territorial agreements that lead to the revision of regional borders (see "RFE/RL Newsline," 26 January 1999). According to the daily, there are many more territorial claims than just "Ingushetia's claims to the Prigorodnii district of North Ossetia." The newspaper concluded that "it is possible that by 2000 conflicts between oblasts and autonomous okrugs may acquire an open form, the more so if the central powers continue to lose influence in the [Russian] Federation." JAC

TATARSTAN, MOSCOW IN BUDGET DISPUTE

Meeting with faculty members of the Kazan Institute of Economy and Finance on 1 February, Tatarstan's Prime Minister Rustam Minnikhanov said his government considers it expedient to reduce payments to the federal center since the federal budget was formed without taking into account Tatarstan's needs and does not provide for "the minimum of required allowances" for the Tatarstan Republic. "We are a donor region", he said, "we are not asking for federal subsidies, we are asking for our own money." Minnikhanov did not indicate what percentage of its proposed contribution to the federal budget Kazan would withhold. LF

CHINA SUGGESTED TO JOIN DISCUSSION ON ABM TREATY

Igor Sutyagin of the U.S.A. and Canada Institute has reacted negatively to news of a U.S. government proposal to compensate for the deployment of two anti-ballistic missile systems by giving Russia permission to have three warheads on its Topol-M missile system. Sutyagin told ITAR-TASS that the U.S. is apparently trying to find a way to alleviate Russia's concerns stemming from the U.S.'s proposal to modify the ABM treaty. He said that the idea of giving Russia permission to have missiles with three warheads in exchange for "its consent to deploy the ABM system looks very attractive[but] only resolves the problem of Russia's relations with the U.S.," not with China. Sutyagin recommended that China be drawn into the discussion of the problem of the creation of the U.S. anti- ballistic missile system. JAC

RUSSIA SAYS NO INTERNATIONAL PEACE-KEEPING FORCE NEEDED IN KOSOVA

"Russian diplomatic sources" told Interfax on 1 February that Moscow sees no sense in deploying an international peacekeeping force in Kosova similar to the one deployed in Bosnia. According to those sources, an international force should be sent only after the conflicting sides have worked out an agreement on Kosova and Yugoslavia has given its consent for the deployment of such a force. JAC

SIDANKO ON VERGE OF BANKRUPTCY...

Russia's fifth-largest oil company, Sidanko, announced on 29 January that it is facing bankruptcy proceedings because of overdue loan payments. Sidanko is controlled by so-called oligarch Vladimir Potanin's Interros holding company, the core of which is the now struggling Oneksimbank. Citing an "industry source with ties to Sidanko," the "Moscow Times" reported on 2 February that Interros is now "bankrupting" Sidanko to set up a new company and has transferred titles of the shares of its subsidiaries to offshore companies. According to another anonymous source, the newspaper reported, this is a bankruptcy in the typical style of Boris Jordan, the controversial banker who assumed the helm of Sidanko in November. Both Sidanko and Interros deny the allegations, the daily noted. JC

...AS SLAVNEFT, ONAKO SAY 'NO' TO MERGER

Two of the three companies selected by the Russian government to be merged into one company, which reportedly would be one of the world's largest in terms of oil reserves, have expressed their opposition to the plan (see "RFE/RL Newsline," 26 January 1999). Onako would rather transfer its government-controlled majority stake to Orenburg Oblast, the "Moscow Times" reported on 2 February. Slavneft President Vasilii Duma said after a shareholders' meeting that Slavneft would be best left untouched. The newspaper suggested that the Belarusian Property Ministry, which owns 10 percent of Slavneft, likely opposes the merger. The ministry, however, has so far made no public statement. JAC

EXTREMIST GROUP MARCHES IN MOSCOW

Protestors from the extremist National Bolshevik Party led by novelist Eduard Limonov disrupted a meeting of the Democratic Choice party in Moscow on 30 January by chanting the names of "Stalin" and "Beria" and making Nazi salutes, Ekho Moskvy reported. A fistfight eventually broke out between members of the two parties, Interfax reported. The next day, another group, Russian National Unity, marched through Moscow. Presidential chief of staff Nikolai Bordyuzha told "Izvestiya" that the march was a provocation intended to stir trouble and that it is "nonsense" that Russia has no clear law defining political extremism. Justice Minister Pavel Krasheninnikov told Interfax on 1 February that the presidential commission for combating political extremism will discuss the group at its next meeting. JAC

SOUTH KOREA ASKS RUSSIA FOR HELP WITH MILLENNIUM BUG IN NORTH KOREA

The military attach of the South Korean Embassy in Moscow has delivered a letter to "Russian defense structures" asking Moscow to help North Korea examine possible computer problems associated with the Millennium Bug, ITAR-TASS reported on 2 February. Seoul is worried that computer problems in North Korea associated with the turn of the century could result in the accidental firing of rockets. Seoul has requested Moscow's help because most of North Korea's rocket and computer technology was supplied by the former Soviet Union. BP

YELTSIN LOOKING CHIPPER AT BIRTHDAY CELEBRATION

Russian Public Television carried film footage of a small celebration of President Boris Yeltsin's birthday on 1 February. Patriarch of Moscow and All Russia Aleksii II and Prime Minister Primakov brought bouquets and hugged Yeltsin, who appeared cheerful. The same day, the Duma's impeachment commission held hearings on the last charge against Yeltsin, genocide against the Russian people, Interfax reported. "Kommersant-Daily" reported the next day that following the signing of his most recent decree, Yeltsin now has only three presidential advisers, only two of which receive a salary: his daughter Tatyana Dyachenko and Mikhail Zybarov (see "RFE/RL Newsline, 1 February 1999). Valentin Yumashev also acts as an adviser but does not draw a salary. JAC

CHECHEN FIELD COMMANDERS SEND MIXED SIGNALS?

Meeting on 1 February, former Chechen acting President Zelimkhan Yandarbiev, former Foreign Minister Movladi Udugov, and leading field commanders Shamil Basaev and Ruslan Gilaev adopted a formal petition to President Aslan Maskhadov calling on him to introduce Shariah law throughout Chechnya immediately, Interfax reported. Last week, they had drafted a program of reform measures addressed to Maskhadov that entailed curtailing the powers of the president and the creation of a "state council," the powers and functions of which are unclear, according to "Izvestiya" on 28 January. But that program made no mention of either Islam or Islamic law. LF


RFE/RL NewsLine - Southeastern Europe




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BELGRADE APPEALS TO UN

The state-run news agency Tanjug carried a statement by the Yugoslav government on 1 February calling on the UN Security Council to prevent NATO from carrying out possible air strikes against Serbia. The government argued that "NATO's open threats jeopardize the chief principles of international relations, international peace and security, and the very foundations of international legal order. This is why the federal cabinet decided to call for a UN Security Council session to take adequate measures...to prevent armed aggression against the Federal Republic of Yugoslavia." Reuters quoted political analysts in Belgrade as saying that the government of President Slobodan Milosevic issued the appeal in order to "make a mess, to buy some time." The Contact Group has set a 6 February deadline for Belgrade and the Kosovars to reply to its ultimatum to attend talks or face military action. The Security Council has endorsed the Contact Group's position (see "RFE/RL Newsline," 1 February 1999). PM

SERBS, UCK DELAY RESPONSE TO ULTIMATUM

Serbian Deputy Prime Minister Vojislav Seselj said in Belgrade on 1 February that only the parliament, which meets on 4 February, has the authority to respond to the Contact Group. Serbian Deputy Prime Minister Milovan Bojic charged that "NATO is the weapon in the hands of one or two states, to whom the [NATO member states] are bowing." Yugoslav Deputy Prime Minister Vuk Draskovic argued that Serbia runs the risk of increased international isolation if it rejects the ultimatum. In Prishtina, Adem Demaci, who is the political spokesman for the Kosova Liberation Army (UCK), said that the guerrillas will respond to the Contact Group on 3 February, RFE/RL's South Slavic Service reported. Nationalist politician Rexhep Qosja has agreed to attend the talks (see "RFE/RL Newsline," 1 February 1999). PM

HILL WARNS OF 'MAXIMUM STRAIN'

U.S. envoy for Kosova Chris Hill told Reuters in Prishtina on 2 February that the coming days and weeks are "going to be a period of maximum strain" regarding the crisis in Kosova. "There will be people on the ground trying to disrupt the talks.� There has [also] been considerable concern, especially among the Europeans, about whether we have sufficient leverage on the [guerrillas], and there's been a lot of effort made to try to figure out what that leverage might be. Obviously it's going to be different from the leverage on the Serbs, and appropriately so. The Serbs have been threatened with punitive air strikes, and obviously that's not in the cards for the [UCK]. Other things can be done. Enough said." Hill nonetheless added: "I never like to use 'optimism' and 'Balkans' in the same sentence, but I believe we have a very good process ahead." PM

CLINTON MEETS ADVISERS OVER KOSOVA

U.S. President Bill Clinton discussed Kosova with his top political and military advisers on 1 February. White House officials gave no comment as to whether Clinton and his aides decided whether to commit U.S. ground troops as part of an eventual settlement in the province. Secretary of Defense William Cohen, who opposes deployment, said that a final decision will depend on the final settlement and on the role that the European allies are willing to assume for themselves. He stressed that the Europeans must "bear a substantial burden" of any military presence on the ground. Secretary of State Madeleine Albright's spokesman said that "there is a need and an urgency for American leadership and determination" in Kosova. He added that the U.S. has "significant national interests at stake" in ending the crisis. PM

ANNAN WARNS OF SPREADING CONFLICT

NATO Secretary-General Javier Solana noted in Berlin on 1 February that up to 30,000 ground troops might be required as part of an eventual settlement, the BBC's Serbian Service reported. In New York, UN Secretary-General Kofi Annan said in a report to the Security Council that the Kosova conflict could become "an all-out civil war...that might have unpredictable repercussions" across the Balkans. PM

CROATIA FREES NADA SAKIC

State Attorney Radovan Santek said in Zagreb on 1 February that he has stopped proceedings against 76- year-old Nada Sakic for war crimes in connection with her activities at concentration camps run by the pro-Axis Ustasha regime during World War II (see "RFE/RL Newsline," 2 November 1998). He said that none of the 26 witnesses who have testified against her during the past three months could prove the charges against her. Sakic told reporters as she left prison that "justice has won." Serbian and Jewish spokesmen said her release proves that the Croatian government is not serious about prosecuting Ustasha war criminals. Sakic was extradited in November from Argentina, where she and her husband had lived since the end of World War II. Dinko Sakic still faces trial for war crimes in Croatia, to which Argentina extradited him last June. PM

ALBANIAN PYRAMID MONEY IN SWISS BANKS

Albanian anti-mafia investigator Bujar Himci told "Shekulli" on 2 February that the Swiss authorities have discovered bank accounts belonging to the Albanian pyramid scheme owner Vehbi Alimucaj. Himci did not say how much is in the accounts but noted that the Swiss authorities last week handed over "a large file...that sheds light on Alimucaj's activities and transfers." He also commented that Ajdin Sejdia, a Kosovar Albanian businessman, was involved in Alimucaj's money laundering schemes. German police arrested Sejdia in November 1998 under a Swiss arrest warrant. A Swiss court had earlier sentenced Sejdia in absentia for fraud in connection with a failed hotel project in central Tirana. The construction of that hotel, which began in 1991, resulted only in a huge crater, which locals say epitomizes shady Kosovar business practices. FS

ROUND-TABLE IN SOUTHERN ALBANIAN REBEL TOWN

Deputy Minister for Local Government Taulant Dedja and OSCE Ambassador to Albania Daan Everts met with local officials in Lazarat on 1 February to discuss problems in developing infrastructure (see "RFE/RL Newsline," 25 January 1999). Everts told "Koha Jone"

PRIMAKOV'S AMBITIONS


By Floriana Fossato

Russian Prime Minister Yevgenii Primakov may or may not want to be a presidential candidate, but at the very least he seems to view himself as the kingmaker of Russian politics.

Since his appointment as premier last September, Primakov has studiously avoided showing any enthusiasm for the idea of becoming a presidential candidate. However, shortly after his appointment, Primakov, a former diplomat and spymaster, started promoting former security officials to sensitive media and government jobs.

Among those ex-security officials is Grigorii Rapota, a career spy and former deputy secretary of the Russian Security Council. Last November, Rapota was named head of Russia's state- owned arms exporter, Rosvooruzhenie. He replaced Yevgenii Ananev, considered an associate of former Prime Minister Viktor Chernomyrdin.

Rapota has worked closely with Primakov in the past. He was the deputy head of Russia's Foreign Intelligence Service (SVR). Before his 1996 appointment as foreign minister, Primakov had headed that agency. According to Russian media reports, control over the lucrative Rosvooruzhenie has been the subject of bitter rivalry among senior politicians.

In a rare interview, published in "Kommersant-Daily" last week, Rapota said Rosvooruzhenie does not expect to earn more than $2 billion in arms sales abroad this year, owing to Russia's economic crisis and increased competition in the world arms markets. The figure, he said, is the same as that in 1998. (Before the August financial meltdown, exports of Russian arms had been estimated to earn some $3.5 billion this year.) That helps explain the fierce competition for control over the company, which in the past was reported to be an important source of financing during election campaigns.

Recent unsuccessful moves to appoint a retiring counter- intelligence general to a senior position at the All-Russian State Television and Radio Company (VGTRK) also drew attention. General Yurii Kobaladze is a former public relations head at SVR, where he also served under Primakov. His appointment had initially appeared to be certain. But last week, he was named first deputy director of the ITAR-TASS news agency. He filled the post left vacant after Leonid Nevzlin, close to the Rosprom-Yukos industrial group, quit in the wake of the August financial meltdown.

Before any decision had been formalized, Kobaladze himself said that VGTRK chairman Mikhail Shvydkoi had offered him the job. However, Shvydkoi's deputy, Mikhail Lesin, had ruled out that possibility. Lesin is one of the founders of Video International. That company has a monopoly on advertising at VGTRK, which is the latter's main source of revenue.

VGTRK includes the second nationwide channel of Russian Television, the channel Kultura, Radio Russia, the RIA news agency, a network of radio and television stations across Russia, as well as the national transmission network. Despite serious financial difficulties, VGTRK and other media holdings are expected to play a key role in influencing the outcome of presidential and parliamentary elections.

Even if Kobaladze did not achieve his goal, other former security service officials already working at VGTRK now reportedly hold top jobs. In December, Lev Koshlyakov, who until 1994 worked for the counter-intelligence service, was named to head the news program "Vesti." He coordinates the network of correspondents both for the program and for the RIA news agency.

Judging from a number of recent government appointments, other officials who--unlike Rapota and Kobaladze--never worked with Primakov but made their careers in security organs have been promoted to top positions in government agencies considered potential key sources of campaign financing.

In October, former First Deputy Interior Minister Mikhail Yegorov was appointed first deputy head of the Customs Committee. The same month, Aleksei Shestaperov, formerly deputy head of the Federal Agency of Government Communications and Information (FAPSI) was chosen to head the state-owned company Rostek, which reportedly has links with the Customs Committee since it deals with customs payments.

In November, a Defense Ministry officer, General Vladimir Kovalev, became deputy transport minister. The Transport Ministry, together with the power grid Unified Energy Systems and the gas monopoly Gazprom, is one of Russia's so-called natural monopolies. Most analysts in Moscow expect those monopolies to be a source of patronage and financing ahead of parliamentary elections in December and presidential elections scheduled for June 2000.

This trend indicates that even if he does not become a presidential candidate, Primakov, with his extensive political and economic influence, will be one of the country's most powerful kingmakers. The author is a Moscow-based RFE/RL correspondent.


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