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Newsline - August 13, 1999




RUSSIAN FORCES CONTINUE OFFENSIVE IN DAGHESTAN

Russian forces on 12 August continued to strengthen their control over Tsumadin Raion. Daghestani police killed eight militants in fighting in the village of Godoberi in Botlikh Raion, which the militants claimed on 12 August to control fully, according to Interfax. Russian troops also launched massive air and artillery strikes against the village of Tando in Botlikh on 12 August. "Nezavisimaya gazeta" noted the next day that Russian military spokesmen no longer refer to their objective as annihilating the guerrillas but merely to driving them back across the border into Chechnya. The newspaper comments, however, that the Russian forces are clearly numerically inadequate to achieve either objective. An additional 600 troops from the North Caucasus Military District, including paratroopers and a special operations battalion, were flown to the combat zone on 12 August. LF

CASUALTY REPORTS CONTRADICTORY

A Daghestani Interior Ministry official said on 12 August that the militants shot down a Russian helicopter two days earlier, killing an officer and wounding six servicemen. According to "Nezavisimaya gazeta," it is the fifth helicopter destroyed since the fighting began. A Russian Interior Ministry official told Interfax on 12 August that the militants' losses to date are 150 killed and 300 wounded. The wounded reportedly include Jordanian-born Chechen field commander Khottab, whom Shamil Basaev appointed commander of the so- called Daghestan Islamic Army on 11 August. In Grozny, however, a spokesman for the guerrillas said only five of their men have been killed and 15 wounded since hostilities began earlier this month. Interfax reported on 12 August that the guerrillas have summoned reinforcements from Chechnya. LF

CHECHNYA REFUSES TO JOIN RUSSIAN OPERATION IN DAGHESTAN

The Chechen leadership has rejected invitations by the Russian Interior Ministry to send a contingent of troops to join the Russian forces currently fighting against Islamic militants in Daghestan, presidential press spokesman Said Abdulmuslimov told Interfax on 12 August. He added that the Chechen people "have nothing to do with what is going on" in the neighboring republic. Meanwhile, the Chechen Foreign Ministry has written to UN Secretary-General Kofi Annan warning of the danger of a new war between Russia and Chechnya as a result of what it terms "the Russian leadership's attempts to extend the armed conflict in Daghestan to the territory of the independent Chechen state." Chechnya has also addressed a note to the Russian Foreign Ministry protesting the alleged violation by Russian troops of Chechnya's borders. The note claims that Russian aircraft have carried out rocket attacks and bombing raids against three districts in Chechnya, killing an unspecified number of civilians. LF

RUSSIAN MUSLIMS EXPRESS CONCERN AT FIGHTING IN DAGHESTAN

In a joint address to Russia's Muslims on 11 August, the Russian Council of Muftis and Muslim Religious Board for European Russia called for measures to prevent an escalation of the fighting in Daghestan and expressed support for initiatives by religious boards in Chechnya and Daghestan to resolve the conflict peacefully, ITAR-TASS reported. The previous day, the leader of North Ossetia's Muslims, Dzankot-hadji Khekilaev, denounced the militants' call to establish an independent Islamic state in the Caucasus. Tatarstan's Muslim Religious Board issued a statement on 12 August urging a halt to combat operations in Daghestan and condemning the participation of Muslim militants in a fight against fellow Muslims, RFE/RL's Kazan bureau reported. The statement also called on Moscow to develop a state policy toward ethnic and religious minorities in Russia. LF

PUTIN SETS OUT TO WOO GOVERNORS...

Acting Prime Minister Vladimir Putin told members of the interregional association Siberian Accord on 13 August that the federal government "has devoted and will continue to devote close attention" to Siberia but added that "the federal center must remain strong. Otherwise there can be no federation, just an almshouse," ITAR-TASS reported. Putin noted that the Finance Ministry has submitted the 2000 federal budget to the government and that "the opinion of Russian governors about the document is important." Former Prime Minister Sergei Stepashin had been scheduled to appear at the meeting, but his successor filled in for him--an action that "Izvestiya" on 13 August suggested illustrates how Putin is attempting to retain the economic course of the previous government while trying to establish working relations with the regional elite. According to the daily, many regional leaders are dissatisfied with the draft budget. JAC

...WHILE GOVERNORS ARGUE THAT GOVERNMENT DISMISSAL DELAYS REAL WORK

Former Krasnoyarsk Krai Governor Valerii Zubov told "Izvestiya" on 13 August that the "Finance Ministry simply did not consider the importance of political factors this year and...we lack revenues again and the only thing left to do is...to reduce expenditures." Sakhalin Governor Igor Farkhutdinov's press secretary told RFE/RL's Vladivostok correspondents on 10 August that Stepashin's dismissal will further delay the efforts of regions dependent on federal assistance to prepare for the winter. He noted that now a least a month will pass before the Finance Ministry begins paying for supplies of fuel and food as part of its northern delivery program. A month's delay could prove critical for areas, such as Magadan, that must take advantage of the thawed sea before it freezes over again in October. Primorskii Krai Governor Yevgenii Nazdratenko told a local television station that his government will now have to renegotiate contracts with the federal government for fuel delivery. JAC

PRIMAKOV KEEPS MUM ABOUT FUTURE PLANS

Despite reports that he has agreed to head the Fatherland-All Russia alliance, former Prime Minister Yevgenii Primakov is so far resisting making his own announcement. On 12 August, St. Petersburg Governor Vladimir Yakovlev revealed Primakov's alleged future plans, as did Agrarian Party member and former Deputy Prime Minister Gennadii Kulik the previous day (see "RFE/RL Newsline," 12 August 1999). "Nezavisimaya gazeta" noted on 12 August that while Primakov's addition to the alliance led by Moscow Mayor Yurii Luzhkov and Tatarstan President Mintimer Shaimiev would likely attract many votes, the combination might be problematic in that Primakov does not support greater sovereignty for the republics, unlike many members of All Russia. The daily also noted that Primakov is not a person of "iron health" and that "it is too naive to think that dirty election tricks won't be applied against [him]." "Nezavisimaya gazeta" receives financial support from Boris Berezovskii's LogoVAZ group. JAC

KALYUZHNII REJECTS ALLOWING ROSVOORUZHENIE TO EXPORT OIL

Fuel and Energy Minister Viktor Kalyuzhnii told Interfax on 12 August he has officially rejected a request by the arms export giant Rosvooruzhenie to be allowed to export 30,000 tons of oil per month. He added that he might reverse that decision if his ministry is allowed to enter the weapons market. The following day, newly appointed Rosvooruzhenie Director-General Aleksi Ogarev told Interfax after meeting with President Yeltsin that the latter will soon sign a decree enabling the Russian defense industry to sell more weaponry on international markets. LF

PUTIN REASSURES U.S. OVER COOPERATION, ECONOMIC REFORM

Speaking by telephone to U.S. National Security Adviser Sandy Berger on 12 August, acting Prime Minister Putin confirmed Russia's desire to strengthen U.S.-Russian relations and cooperation and stressed that his government intends to follow the Yeltsin-Clinton agenda mapped out at the G-8 meeting in Cologne, Germany, earlier this year. Berger, for his part, emphasized the importance of making progress on arms control, non-proliferation, and economic issues. U.S. and Russian experts are due to meet in Moscow next week to discuss the Start-III arms reduction treaty as well as possible changes to the 1972 ABM Treaty (see "RFE/RL Newsline," 6 August 1999). JC

RUSSIAN EXPERT SAYS MOSCOW MUST DEFEND ABM TREATY

In an article published in "Nezavisimaya gazeta" of 12 August, arms control expert Valerii Alekseevskii argued that it is Russia's task to prevent the "destruction" of the ABM Treaty. "In its desire to deploy a national ABM system," Alekseevskii wrote, the U.S. is steering a course toward the revision of that treaty, as a result of which the agreement could be "derailed." Russia must defend a position whereby the two sides fully implement their commitments, he added. "If Russia were to go halfway to meet American attempts to revise the fundamental obligations under the ABM treaty, this would be not only a military blunder but also an unforgivable foreign- policy error," Alekseevskii concluded. JC

LATEST GOVERNMENT SACKING INSPIRES NEW CALLS TO CHANGE CONSTITUTION

Former Prime Minister and head of New Force Sergei Kirienko told reporters on 12 August that his party has formed groups in Moscow, Tver, Novosibirsk, and Arkhangelsk to gather signatures in order to hold referenda on a new constitution, "The Moscow Times" reported on 13 August. Kirienko is proposing that before the upcoming presidential elections, three referenda be held to determine whether citizens would support limiting the power of the president and the parliament in favor of the cabinet. Two million signatures are needed for a referendum. The same day, former presidential advisers Georgii Satarov and Mikhail Krasnov offered a new draft version of the constitution under which the prime minister would be nominated not by the president but by a majority of votes in the State Duma, ITAR- TASS reported. JAC

GOVERNMENT MAKES MORE PROGRESS REDUCING PENSION BACKLOG

Pension Fund head Mikhail Zurabov reported on 12 August that the pension backlog stood at 7.0 billion rubles ($280 million) as of 1 August, down from 26.3 billion rubles on 1 January, ITAR-TASS reported. According to Zurabov, the backlog has been halved over the past three months. Zurabov said last month that the average lag in payments to pensioners is roughly one week and that only in a few regions does it reach a month. In addition, he said, 49 regions have wiped out all pension arrears. JAC

IS THE VOICE OF RUSSIA CRACKING?

Following up on earlier reports, "Moskovskii komsomolets" wrote on 13 August that members of the political council of Voice of Russia have not only voted against joining a coalition composed of Right Cause and New Force but also have declared their desire to join the Fatherland-All Russia bloc (see "RFE/RL Newsline," 11 August 1999). Samara Governor Konstantin Titov is the informal leader of Voice of Russia. Vladimir Medvedev, a member of the political council of All Russia, told "Vremya MN" on 11 August that the Voice of Russia never really existed, adding that it has no philosophy and Titov does not have the support of other regional leaders. He also noted that the Democratic Party of Russia, a group which earlier abandoned Voice of Russia, is now actively working with All Russia (see "RFE/RL Russian Federation Report," 28 July 1999). JAC

NDR REJECTS RIGHT-CENTRIST ALLIANCE

"Kommersant-Daily" reported on 12 August that Our Home Is Russia (NDR) leader Viktor Chernomyrdin has definitively rejected any alliance with Unified Energy Systems head Anatolii Chubais's Right Cause and New Force. On 6 August, Chubais told reporters that no decision to unite with the NDR had yet been made but there "is movement in this direction." According to the newspaper, Chernomyrdin told journalists that the NDR has ruled out supporting a common electoral list with Right Cause in upcoming parliamentary elections. The newspaper linked Chernomyrdin's firm dismissal of such an alliance to the NDR leader's meeting with acting Prime Minister Putin the previous day. Putin, it noted, was formerly a member of the NDR, serving on its political council in 1996. JAC

RUSSIAN DEPUTY UN AMBASSADOR WANTS SERBIAN POLICE AND MILITARY BACK IN KOSOVA

Gennadii Gatilov told ITAR-TASS in New York on 12 August that "it is necessary to launch constructive cooperation with the Yugoslav and Serbian authorities. The return of the limited contingent of Yugoslav military and police forces to Kosova should be ensured without artificial delays. The Yugoslavs must, in particular, participate in immigration and customs control on the border with Albania and Macedonia." Gatilov argued that KFOR actions are "clearly insufficient" and that no serious action is being take to counter the "large-scale ethnic cleansing carried out by [Kosovar] Albanians.... The Kosova Liberation Army [UCK] is actually working to preserve itself as a military organization for the de facto seizure of power." FS

YUGOSLAV MOSCOW AMBASSADOR SAYS BELGRADE WANTS 'MULTI-ETHNIC' KOSOVA

Borislav Milosevic, who is Yugoslav ambassador to Moscow and brother of the Yugoslav president, told Interfax on 12 August that the Yugoslav government "invariably stands for a multi-ethnic and multi-religious [Kosova] with extensive autonomy within the Yugoslav Federation." He added that "some NATO countries, especially the U.S., are in effect supporting the intentions of the UCK to become the basis for a future government in the province." Milosevic argued that this violates UN Security Council Resolution No. 1244, which guarantees Yugoslav sovereignty over Kosova. He added that the International Criminal Tribunal for the Former Yugoslavia "is part of an aggression mechanism that, disregarding...justice, protects those who bear the true blame for the genocide brought against the Yugoslav people, the leaders of NATO, the U.S., and Great Britain." FS

CHERKESS VOW TO SECEDE FROM KARACHEVO-CHERKESSIA

A congress of supporters of defeated Karachaevo-Cherkess presidential candidate Stanislav Derev has decided at a congress in the republic's capital, Cherkessk, to appeal to President Yeltsin to restore the Cherkess autonomous formation that existed as part of Stavropol Krai until 1957, "Nezavisimaya gazeta" reported on 12 August. Meanwhile, the republic's Supreme Court is again examining the outcome of the presidential poll, in which Derev's rival, former Russian army ground forces commander Vladimir Semenov, who is an ethnic Karachai, polled more than 70 percent of the vote. The newspaper reports that the republic's parliament, government, and administrative bodies are split between supporters of the two rival candidates. LF




ARMENIAN GOVERNMENT CALLS FOR EMERGENCY PARLIAMENT SESSION

The government on 12 August requested that President Robert Kocharian convene an emergency parliament session on 23 August to debate its proposed budget cuts, RFE/RL's Yerevan bureau reported. In late July, Prime Minister Vazgen Sargsian had proposed measures to overcome the 33 billion dram ($61 million) budget shortfall incurred during the first six months of 1999. Those measures included cracking down on tax evasion and increasing duties on gasoline and cigarettes (see "RFE/RL Newsline," 29 July 1999). The parliament, which is loyal to Sargsian, is likely to endorse those proposed measures. Also on 12 August, the government announced the firing of 15 town and village council heads for allegedly failing to ensure the planned level of local budgets. Minister for Local Government Khosrov Harutiunian said that the dismissed local officials had also failed to cooperate with tax authorities. LF

AZERBAIJANI PRESIDENT MEETS WITH U.S. DELEGATION

Heidar Aliyev held talks in Baku on 12 August with a visiting delegation of five U.S. Congressmen who had previously visited Yerevan and the unrecognized Nagorno-Karabakh Republic, Interfax and Turan reported (see "RFE/RL Newsline," 10 and 11 August 1999). Aliyev noted that bilateral relations are expanding but complained at Congress's failure to repeal Section 907 of the Freedom Support Act, which bars direct U.S. economic and military aid to Azerbaijan as long as the blockade of Armenia and Karabakh remains in force. The Congressmen called for the continued observance of the existing cease-fire and for further direct contacts between the presidents of Armenia and Azerbaijan in order to find a political solution to the Karabakh conflict. LF

FORMER GEORGIAN FINANCE MINISTER ON TRIAL

The trial of Guram Absandze, who served as finance minister in 1991-1992 under the late President Zviad Gamsakhurdia, opened in Georgia's Supreme Court on 12 August, Caucasus Press reported. Absandze, along with 12 others, is accused of planning the attempt to assassinate Georgian President Eduard Shevardnadze on 9 February 1998. Three people, including two of Shevardnadze's bodyguards, died in a mortar attack on the presidential motorcade. Absandze has rejected almost all the charges against him as politically motivated, according to Interfax. LF

DID KAZAKHSTAN SELL MIGS TO NORTH KOREA?

Kazakhstan's National Security Committee on 12 August opened a criminal investigation into the circumstances of the abortive sale of six obsolete MiG fighters, an RFE/RL corespondent in Almaty reported. The same day, South Korea's Foreign Minister Hong Soon-Young summoned the Kazakh ambassador in Seoul and expressed "serious concern" that the ultimate destination of the MiGs, which Kazakh officials say were bound for the Czech Republic, was North Korea, according to AP. A Russian transport aircraft carrying the disassembled fighters was impounded at Baku's Bina airport in March. The Azerbaijani authorities later returned them to Kazakhstan (see "RFE/RL Newsline," 24 March and 21 April 1999). On 11 August, the U.S. similarly expressed "serious concern" that Kazakhstan may have exported dozens of MiG-21 fighters to North Korea. Meanwhile, U.S. Vice President Al Gore telephoned Kazakhstan's President Nursultan Nazarbaev on 12 August to discuss bilateral relations and regional and international security issues, according to ITAR-TASS. LF

KAZAKHSTAN'S PARLIAMENT SPEAKER CRITICIZES NEW MEDIA LAW

Addressing an international conference on the media in Almaty on 12 August, Marat Ospanov said he thinks the new media law passed by Kazakhstan's parliament last month contains "many undemocratic norms," adding that he would welcome the postponement of its adoption, according to Interfax. Conference participants agreed on the wording of an appeal addressed to President Nazarbaev, which points to restrictions on media openness and freedom of speech in Kazakhstan, especially with regard to journalists' attempts to spotlight corruption. It also calls on the president to suspend the law so that it can be reformulated to "ensure the observance of the constitutionally guaranteed principles of openness and the ban on censorship." LF

GUERRILLAS RELEASE ONE KYRGYZ HOSTAGE, TAKE ANOTHER

The militants from Tajikistan who took four Kyrgyz officials hostage last week in the Batken district of southern Kyrgyzstan seized a fifth hostage on 12 August, Interfax and ITAR-TASS reported. They later released one of the original four hostages, who told the Kyrgyz authorities that the band is demanding a large sum of money. Speaking at a press conference in Tashkent on 12 August, Uzbekistan's Foreign Minister Abdulaziz Kamilov confirmed earlier reports that some of the militants are Uzbek citizens and members of the armed military formation of Djuma Namangani. Kamilov said that the situation in Kyrgyzstan is the internal affair of that country, but at the same time he expressed the hope that the Kyrgyz authorities will not allow the guerrillas to enter Uzbekistan until they have been disarmed. LF

TAJIKISTAN DENIES ITS NATIONALS FIGHTING IN DAGHESTAN

Tajikistan's Security Council secretary Amirkul Azimov told ITAR-TASS on 12 August that there is no truth to Russian media reports that some Tajik nationals are fighting on the side of the Islamic militants in Daghestan. He added that the Tajik people, having themselves experienced civil war, "will never take part in any unfavorable actions against friendly Russia." LF

TURKMENISTAN THREATENS TO TAKE UKRAINE TO COURT

Turkmenistan's Foreign Ministry released a statement on 12 August warning that it will take Ukraine to an international arbitration court if that country fails to pay its debts for this year's supplies of Turkmen natural gas soon, ITAR-TASS reported. As of 12 August, Ukraine had paid for only some 10 percent of the 8.76 billion cubic meters of gas supplies between 1 January and 21 May, when gas transports were suspended (see "RFE/RL Newsline," 9 August 1999). LF

U.S. EXPERTS INSPECT UZBEK FORMER CHEMICAL WEAPONS PLANT

A team from the U.S. Defense Ministry on 12 August toured the Nukus chemical plant in northwestern Uzbekistan, which until 1993 served as a testing ground for Soviet and Russian chemical weapons, AP and Interfax reported. The U.S. team will decontaminate the test laboratories and then set about trying to locate and neutralize hundreds of tons of germ- warfare cultures, including pulmonary anthrax, which are buried on an island in the Aral Sea, according to the "Frankfurter Allgemeine Zeitung" of 11 August. Those measures are foreseen in a U.S.-Uzbek agreement signed in May 1999 (see "RFE/RL Newsline," 26 May 1999). LF




WORLD BANK SAYS BELARUS LOSING TIME ON REFORM

Serhiy Kulyk, the World Bank's permanent representative in Minsk, told journalists on 12 August that the "time credit" for implementing necessary market reforms in Belarus is shrinking, Belapan reported. Commenting on his meeting with Belarusian Premier Syarhey Linh this week, Kulyk said he informed Linh about the World Bank's stance on cooperation with Belarus. According to Kulyk, the bank will finance various projects only after the government has liberalized its monetary and pricing policies. Kulyk also noted that Belarus's social policy needs to be reoriented toward a "targeted support" approach since many of the state's social expenditures seem unjustified. He added, however, that the bank does not intend to dictate what economic course Belarus must adopt. JM

LUKASHENKA SAYS STEPASHIN'S OUSTER NOT AFFECTING INTEGRATION

Belarusian President Alyaksandr Lukashenka told journalists on 12 July that the dismissal of Sergei Stepashin's cabinet will not change the pace of Belarusian-Russian integration. "The departure of Stepashin and the arrival of Putin does not mean that we have come to a halt in this process. It is being continued, let us say, as sluggishly as it has been continued so far," Lukashenka commented. He also noted that Russia rejected the "radical" Belarusian proposal for a Belarusian- Russian state and suggested its own, more moderate version. "Therefore I said: 'Let it be what Russia proposes,'" Belarusian Television quoted Lukashenka as saying. JM

UKRAINE'S FOREIGN TRADE DECREASES

The State Statistics Committee on 12 July reported that Ukraine's foreign trade from January-June fell to $10.8 billion, down 24.6 percent compared with the same period last year. Foreign investment in the first six months of 1999 totaled $265 million, down 48.8 percent on the same period in 1998. The committee also said that Ukraine's population had declined from 52.04 million at the end of 1991 to 49.89 million as of 1 July 1999. JM

YET ANOTHER HOPEFUL TO JOIN UKRAINIAN PRESIDENTIAL POLL

The Supreme Court on 12 August ordered that Vitaliy Kononov, leader of the Green Party, be registered as a presidential candidate, UNIAN reported. The Central Electoral Commission had refused to register Kononov, saying that only 974,527 signatures on the lists supporting his candidacy were genuine. If the commission complies with the order, Kononov will become the 14th presidential hopeful. JM

RUSSIAN CITIZEN IN ESTONIA ENDS HUNGER STRIKE

Eduard Shaumyan ended his hunger strike on 12 August following a three-day protest outside the Russian Embassy in Tallinn (see "RFE/RL Newsline," 10 August 1999). Shaumyan said that the Russian Citizens Union had asked him to stop and that he himself had realized he "could no longer continue" fasting, BNS reported. On 11 August, Shaumyan and three fellow protestors were taken into police custody for several hours after the Russian Embassy telephoned with the authorities, according to Shaumyan. Oleg Morozov, meanwhile, is continuing his hunger strike, after a medical check revealed him to be in satisfactory health. He is due to fast until 18 August, when his 20-day prison sentence for violating immigration laws ends. MH

ESTONIAN MINISTRIES DISAGREE OVER DUTY-FREE

According to press reports. the Foreign and Transport Ministries disagree over whether to request a transition period for the abolition of duty-free shopping when Estonia joins the EU. The Foreign Ministry on 12 August stressed that Estonia will not seek a transition period and suggested it would be "difficult to expect such a concession" since EU members had acrimoniously fought over its abolition, BNS reported. However, Transport Minister Toivo Jurgenson said Estonia should seek a transition period for duty-free shopping, otherwise Estonian shipping lines would be threatened. MH

POLISH CABINET DIVIDED OVER COAL MINING REFORM

The Council of Ministers Economics Committee (KERM) on 12 August rejected the Economics Ministry's changes to the coal mining restructuring plan adopted by the Polish government last year. The ministry proposes delaying the payment of coal industry debts and giving the sector more time to become profitable again. The KERM, however, wants to speed up laying off miners and reducing coal production. "This means firing 50,000 people by 2000, while there is no money for social cushions," Deputy Economics Minister Janusz Szlazak commented. He pledged to submit his own proposal for changes to the plan while bypassing the KERM. Solidarity said the same day that it will demand the dismissal of the cabinet if the KERM's proposal is implemented. JM

POLISH POLICE CLASH WITH PROTESTING FARMERS

Police on 12 August used force and rubber bullets to remove 400 farmers from the governor's office in Olsztyn, northeastern Poland. The farmers, mainly from the radical Self-Defense farmers union, blocked the office and demanded that the government start intervention procurement of wheat, "Gazeta Wyborcza" reported. Thirteen policemen and six farmers were injured in the clash. JM

WITNESS REFUSES TO TESTIFY IN CZECH INVESTIGATION OF 1968 TREASON

Vasil Bilak, former secretary-general of the Slovak Communist Party, has refused to testify in the investigation into Karel Hoffman's role in the August 1968 events, CTK reported on 12 August. That investigation was launched by the Czech Office for the Investigation of the Crimes of Communism. Hoffman, who at the time of the Warsaw Pact invasion of Czechoslovakia was a member of the Czechoslovak Communist Party Central Committee, is suspected of high treason in collusion with a foreign power for having ordered television and radio broadcasts to be switched off on the night of 20-21 August 1968. Bilak's lawyer in Bratislava told CTK that his client has "exercised his constitutional right not to testify," adding that Bilak knows Hoffman to be "an honest person who would have never damaged the interests of the former Czechoslovakia." MS

SLOVAK PRESIDENT APPOINTS NEW TRANSPORT MINISTER

Rudolf Schuster on 12 August appointed Josef Macejko to succeed Gabriel Palacka as transportation minister, SITA reported. The same day, Deputy Transportation Minister Frantisek Kurej resigned. The Prime Minister's Office had earlier established that Kurej was responsible for irregularities in the privatization tender of Slovak Telcom. That tender was one of the factors that led to Palacka's resignation (see "RFE/RL Newsline," 10 and 11 August 1999). Meanwhile, Christian Democratic Party (KDH) chairman Jan Carnogursky, who was one of Palacka's harshest critics, said that although Macejko is a KDH member, the party was not consulted about the appointment and will take no responsibility for it. MS

SLOVAK PARTY RUSHES TO CHAIRMAN MECIAR'S DEFENSE

The Movement for a Democratic Slovakia (HZDS) on 12 August said it is "outraged" by chief investigator Jaroslav Ivor's statement that HZDS chairman Vladimir Meciar might be asked to testify in the investigation into the 1995 abduction of former President Michal Kovac's son. HZDS spokesman Marian Kardos said Meciar has already said he had nothing to do with the abduction. MS

SLOVAK FOREIGN MINISTER OPTIMISTIC ON JOINING EU 'FAST- TRACK' GROUP

Eduard Kukan on 12 August said he is optimistic about Slovakia's chances of soon joining the "fast track" group of EU candidates. Kukan said the recent law on the use of minority languages in contacts with the authorities has improved the country's prospects, SITA reported. He pointed out that EU member countries differ on their view of EU enlargement. Some are of the opinion that Slovakia, Latvia, and Lithuania must join the "fast track" group, while others argue this would create a "dividing line" that leaves out Romania and Bulgaria. A way out of this dilemma, he argued, might be to "lift the status" of all candidates and let economic performance decide which countries join. MS

HUNGARIAN OFFICIAL PRESENTS VOJVODINA AUTONOMY PLAN

Tibor Szabo, chairman of the Office for Hungarians Beyond Borders, told MTI on 12 August that during his current visit to Washington, he presented a plan for Vojvodina's autonomy to Steve Flanagan, special assistant to the president and senior adviser on Central and East European affairs on the National Security Council. Szabo said the government in Budapest "fully supports" the plan, which was worked out by six Hungarian organizations from the region, but acknowledged that Washington "has not made any decision to support the idea of autonomy for Vojvodina." He said that Flanagan promised the plan will be "carefully scrutinized." Later the same day, Szabo told a forum of U.S. citizens of Hungarian origin in Washington that the U.S. has "shown interest" in the idea of autonomy. MS

HUNGARY LEADS FIELD IN CAPITAL INFLOW

Hungary is leading the field in per capita inflow of foreign capital, "Vilaggazdasag" reported on 12 August, citing figures recently published by the OECD. Between 1990 and 1998, capital worth some $17.193 billion flowed into the country, putting Hungary ahead of the Czech Republic, South Korea, Ireland, and Japan. Poland is ahead in terms of total volume with $23 billion, but on a per capita basis Hungary, which has a population of 10 million, ranks higher, MTI reported. MS

U.S. SURVEY SAYS TOO MANY COMMANDERS IN HUNGARIAN ARMY

According to a U.S. survey commissioned by the Defense Ministry, the Hungarian army has too many colonels and lieutenant-colonels and too few non-commissioned officers, MTI reported on 12 August, citing the daily "Magyar Nemzet." The survey said that under the current system, there is no guarantee that promotion is based on performance or educational achievement. MS




THACI PROPOSES APPOINTING PROVISIONAL LEGISLATURE

Kosova Liberation Army (UCK) leader Hashim Thaci told Vienna's "Die Presse" of 13 August that Kosova must have laws that meet international standards before elections can take place. He argued that a "consultative and executive" body for all Kosovars could function as a provisional legislature to pass the laws, but he did not elaborate. Thaci added that a future elected parliament will have to approve legislation passed by that body for those laws to remain valid. He again criticized the UN civil courts for using the Yugoslav and Serbian penal and civil codes, which he had earlier called "undemocratic laws." FS

KOSOVAR ALBANIANS HOLD MORE PROTESTS AGAINST RUSSIAN PEACEKEEPERS

About 2,000 ethnic Albanians demonstrated against Russian peacekeepers in Kamenica on 12 August. The protesters jeered at and beat on vehicles of Russian KFOR soldiers. No other incidents were reported. A Russian soldier told Reuters that "we just try to endure it, turn our head away sometimes. We've got used to this. It happens every day. It's mostly kids, not many adults." Organizers denied they were from the UCK and identified themselves as members of a local "council of civic-minded Albanians." FS

BRITISH KFOR INJURE TWO ALBANIAN CRIMINALS AFTER CAR CHASE

British soldiers arrested four ethnic Albanians and injured two of them in a shoot-out following a car chase near Vernica on 12 August. A fifth escaped. The four are suspected of having intimidated local Serbs. The soldiers said that they had advance warning that ethnic Albanians would launch an attack on local Serbs that day. FS

KOSOVAR STUDENT LEADER HELD IN SERBIAN PRISON

The Serbian authorities continue to hold some 2,270 ethnic Albanians in several prisons in Serbia, the Institute for War and Peace Reporting's "Balkan Crisis Report" noted on 10 August. Another 1,500 Kosovars are missing and presumed imprisoned. Among the imprisoned are Albin Kurti, a well-known Prishtina University student leader and pacifist. He became radicalized during the Serbian crackdown of 1998 and served as press spokesman for senior nationalist politician Adem Demaci, who was the UCK's political representative. Also imprisoned is human rights activist Flora Brovina. Her son told "Balkan Crisis Report" that she has become partly paralyzed while in detention. Officials of the International Committee of the Red Cross have frequently expressed regret that the June peace agreement did not oblige Serbian authorities to release or provide information about Kosovars held in Serbian jails. PM

MILOSEVIC RESHUFFLES YUGOSLAV CABINET

Prime Minister Momir Bulatovic on 12 August removed Deputy Prime Minister Zoran Lilic and seven ministers from the cabinet. Bulatovic announced the appointment of two new deputy prime ministers and 11 ministers. Vojislav Seselj's xenophobic Serbian Radical Party has five of the new posts. Yugoslav President Slobodan Milosevic's Socialists received three, as did his wife's hard-line United Yugoslav Left (JUL). The small Serbian People's Party of Montenegro was given one of the new posts. Cedomir Mirkovic, who is a minister without portfolio, belongs to a small party called New Democracy (ND). A party spokesman said that the ND has called for Milosevic to resign and that Mirkovic has "excluded himself" from the party by accepting a cabinet post, "Danas" reported. PM

HARD-LINERS CONSOLIDATE POSITION IN BELGRADE

All members of the incoming and outgoing Yugoslav governments are on a Western list of 308 top officials barred from receiving Western visas, Reuters reported on 12 August. Ever since Milosevic lost Kosova in June, observers have expected a cabinet reshuffle aimed at reinforcing the position of the hard-liners. This is the first time that the Radicals have served in the Yugoslav cabinet. Goran Matic, who is the new information secretary, belongs to JUL and is known for his outspoken criticism of the non-state media. The ousted Lilic recently called for Serbia to learn to "speak the language" of the international community (see "RFE/RL Balkan Report," 10 August 1999). He now becomes an adviser to Milosevic on foreign economic relations. PM

DEMOCRATIC PARTY SLAMS YUGOSLAV CABINET

The opposition Democrats said in a statement in Belgrade on 12 August that the new cabinet represents "nothing new and nothing good.... With this move, the regime has sent several messages. To the world it is saying 'forget about any cooperation with Yugoslavia,' and to its citizens it is saying that they will face a difficult winter and further impoverishment, without heating and electricity," Reuters reported. Milosevic, for his part, told the new government that "our aim is to continue successfully with the process of current reforms, contribute to an accelerated pace of economic development and increase productivity and living standards." PM

GENERAL PERISIC SAYS MILOSEVIC MUST GO

Former General Momcilo Perisic told a Belgrade press conference on 12 August that the first goal of his new Movement for a Democratic Serbia is to oust Milosevic (see "RFE/RL Balkan Report," 10 August 1999). He stressed that Milosevic "has made Serbia's territory shrink and its people die." The current leadership has "no more right whatsoever to represent us and lead us," Perisic added. He argued that the opposition has "not done much to change things." For that reason, he continued, he founded his own "political movement" instead of joining an existing one. When a reporter asked the former general about his role in the shelling of the Croatian port of Zadar in 1991, Perisic responded that he was "defending a still existing country against rebels." A Croatian court has sentenced him to 20 years in prison in conjunction with the shelling. Many Bosnians regard him as a war criminal for his role in the shelling of Mostar in the 1992-1995 war. PM

SERBIAN PENSIONERS STAGE PROTEST

Some 1,000 retired persons demonstrated in Belgrade on 12 August to protest their low living standards and to demand Milosevic's resignation. A spokesman for the group called on pensioners to join the opposition's anti-Milosevic gathering in Belgrade on 19 August, RFE/RL's South Slavic Service reported. PM

VOJVODINA'S HUNGARIANS TO SET UP PROVISIONAL COUNCIL

A Provisional Council of Hungarians in Vojvodina will be formed on 20 August, Hungarian media reported on 13 August. The council is to be set up on the basis of the three-pronged autonomy concept drawn up by six of the region's Hungarian organizations, according to Laszlo Jozsa, deputy chairman of the Vojvodina Hungarian Federation (VMSZ). It will have 54 members representing the federal, republican, and provincial parliaments and one-fifth of its members will be local council representatives. The VMSZ has informed Hungarian Foreign Minister Janos Martonyi of its intentions, but the Hungarian cabinet has not responded to the announcement, Jozsa said. MS

CROATIAN SERBIAN LEADER BLASTS 'LYNCHING'

Milorad Pupovac, who is a key leader of Croatia's Serbian minority, said in Zagreb on 12 August that the recent killing of Djuro Mutic was deliberate and ethnically motivated, "Novi List" reported (see "RFE/RL Newsline," 12 August 1999). Pupovac noted that no Croatian authority ever accused Mutic of crimes against Croats during the 1991-1995 conflict. The Serbian leader stressed that "everyone in Croatia should be concerned" if Mutic's "lynching" was part of a campaign to expel Serbs from Croatia. He did not elaborate, except to say that the killing was probably the work of more than a few people. PM

UNHCR PAYS MACEDONIA $4.4 MILLION FOR REFUGEE ACCOMMODATION

UNHCR and Macedonian government officials signed an agreement on 12 August whereby the UNHCR will pay Macedonia $4.4 million for expenses the country incurred during this year's refugee crisis. The Macedonian government will receive $1.2 million immediately and the rest in installments. Additional UNHCR assistance to Macedonia includes 13 jeeps and unspecified quantities of radio and fire-fighting equipment. A UNHCR spokesman stressed that the UNHCR usually does not compensate host countries but makes exceptions in some cases. Macedonia took in a total of 360,000 refugees from Kosova. FS

FIRST MODERN MOVIE HOUSE OPENS IN ALBANIA

Culture Minister Edi Rama opened the first modern movie house in Albania on 12 August, dpa reported. Rama stressed that the opening of the movie house, jointly financed by a private investor and the government, "is a very important event in the cultural and social life of the country." An unclear privatization policy and the absence of government support led to the closure of more than 300 communist-era movie houses throughout Albania since 1991. Many became bingo halls, and only one cinema remained in the capital, showing primarily pornography. FS

ALBANIAN LEGISLATIVE REFORM MINISTER RESIGNS

Arben Imami resigned on 12 August "for personal reasons," dpa reported. According to earlier press reports, Imami plans to study law in the U.S. He played a leading role in drafting Albania's post-communist constitution. FS

MOLDOVAN PRISONER IN TRANSDNIESTER ACCUSES PRESIDENT LUCINSCHI

Andrei Ivantoc, a member of the "Ilascu group" imprisoned in the Transdniester since 1992, has accused President Petru Lucinschi and Ion Sturza's cabinet of neglecting the fate of the group. In a 29 July letter that only recently reached Chisinau, Ivantoc said he has been on a hunger strike for 77 days, has lost half of his body weight, and is convinced he will die, RFE/RL's Chisinau bureau reported. He explained that he went on a hunger strike to protest the Tiraspol authorities' "systematic mistreatment" of the group. Ivantoc added that Lucinschi "cynically used" the Ilascu group's ordeals in his 1996 electoral campaign and later wrote to Ilascu saying he hopes to see him in Chisinau "by Christmas 2001." Ivantoc argued that Lucinschi "would probably like to use [the group] once more in his 2000 presidential campaign." MS

BULGARIAN DEPUTY PREMIER ROBBED BY BODYGUARD

Bulgarian police on 12 August said they have arrested Chief Sergeant Kiril Alexandrov of the National Bodyguard Service for theft, AP reported. Alexandrov admitted stealing the equivalent of $120 from the apartment of Deputy Premier Evgeni Bakardzhiev, to whom he had been assigned. That amount equals the average monthly salary in Bulgaria. MS




DEPENDING ON FOREIGN INVESTMENT


By Paul Goble

Post-communist countries that have relied on foreign investment to power their economic recovery frequently find themselves in difficulty when investors turn away. More serious, those that have been able to show relatively high rates of growth in the past as a result of such investment sometimes have allowed that achievement to justify avoiding the hard choices necessary to make growth self-sustaining on the basis of domestic production.

That is what appears to be happening in Estonia, a country whose economic performance over the last eight years has been among the best of the post-communist world but one that now faces declining rates of growth and rising unemployment.

Last week, Kersti Kaljulaid, economics adviser to the country's prime minister, said Estonia needs dramatically higher rates of foreign investment if it is to escape from a mounting economic crisis. That is because its domestic economy is still too weak to power a recovery, she said. But more important, as Kaljulaid herself acknowledged, "foreign investment has been this economy's main motor for years.... Even though the economy went into a standstill last year, we still saw record levels" of outside investment.

Now, however, outside investment may be about to fall as well. The IMF recently refused to back additional investment there and other investors may follow suit. If that happens, Estonia, which has been on the fast track toward EU membership, could find itself in both economic and political difficulties.

Because of Estonia's favorable geographic location and its business-friendly government, foreign investment earlier flowed into the country at impressive rates. A few years ago, for example, foreign investment in Estonia was equal to or even greater than that in the Russian Federation, a country that has a population 100 times larger.

That pattern allowed Estonia to post economic figures far better than most post-Soviet states. But it also lulled some in the Estonian government to conclude that the good times, powered by outside investment, would continue without interruption.

Some Estonian leaders, however, had called attention to such overreliance on foreign investment. In a speech earlier this year, for example, President Lennart Meri pointedly asked "Where is Estonia's Nokia?" in a reference to the Finnish electronics firm that has contributed so much to Estonia's economic expansion. Meri's speech sparked a debate in Estonia's media over whether and when Estonia could develop an industrial base that would drive its economy forward even when foreign investment slowed.

Some participants in that discussion suggested that Estonia should rely on its geographic position to become a bridge between Russia and the West and earn its way as a trading center. But other Estonians objected that such a strategy would leave Tallinn at the mercy of the vagaries of Moscow politics.

Others suggested that Estonia should develop its traditional industries, including fishing and food processing. But their arguments brought the response that such industries would not be sufficient to support high rates of growth for long.

And still others said that Estonia should exploit its remarkably extensive computer network to become an information center for northern Europe. But again there were replies that such a strategy would not be sufficient, given the lead that West Europeans now have in that area.

As a result, this debate petered out with no answer to Meri's question or a broader discussion on the needs for domestic entrepreneurism. However, the current economic crisis, which was brought on by levels of foreign investment that are no longer sufficient to power growth, seems certain to reopen these discussions.

Whether Estonia can find an answer--its own Nokia, in other words--remains very much an open question. But unless it does, Estonia and Estonians are likely to find themselves far more dependent on the international economy than they would like and thus far less independent as a state than they clearly want.


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