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Newsline - October 8, 1999




CHECHEN PRESIDENT APPEALS FOR NATO HELP

Aslan Maskhadov has sent a message to NATO Secretary-General George Robertson asking the alliance to "assist in normalizing relations between the Chechen Republic and Russian Federation in accordance with international law," Reuters reported the following day, citing RIA. ITAR-TASS on 8 October quoted an unnamed senior NATO official as saying that the alliance has not yet received any such appeal from Maskhadov. Meanwhile Russian forces halted their ground advance into Chechnya on 7 October but continued their intensive air and artillery bombardment of villages both north and south of Grozny. In an interview in "Kommersant-Daily" of 8 October, Maskhadov claimed that the 100 Russian troops have been either killed or wounded to date, while Chechen losses are 20 dead and 40 wounded. LF

EU CALLS FOR DIALOGUE BETWEEN MOSCOW, GROZNY

Meeting in Moscow on 7 October with Russian Foreign Minister Igor Ivanov, EU Commissioner for External Affairs Chris Patten called for the resumption of dialogue between the Russian and Chechen leaderships but did not propose that the EU act as mediator in such talks, the "Financial Times" reported on 8 October. Patten also expressed concern over the "humanitarian consequences" of the fighting. Ivanov, for his part, said that Moscow is ready for such a dialogue but that "terrorists and bandit forces" are creating "obstacles" to it, according to ITAR-TASS. Ivanov again said that no external mediation is needed to resolve what he termed an internal Russian problem. LF

RUSSIA DENIES BOMBING FUGITIVES

Prime Minister Vladimir Putin, Defense Minister Igor Sergeev and First Deputy Chief of Staff of the Russian Armed Forces Colonel General Valerii Manilov denied on 7 October that Russian aircraft had bombed a bus carrying Chechen fugitives north of Grozny on 5 October, Reuters reported. Putin said that no such attack took place. Reuters Television had acquired film footage from an amateur photographer in Nazran showing a burned-out bus in which Chechen officials claim 41 Chechens died. "The New York Times" on 8 October published an eye-witness report of the attack by a woman who survived. Chechen officials say at least 450 people have been killed since the Russian bombing raids began one month ago. LF

CHECHEN PUPPET GOVERNMENT UNVEILED

The pro-Russian Chechen parliament elected in the summer of 1996 has formed a 23- member State Council of the Chechen Republic in Moscow, ITAR- TASS reported on 7 October. The parliament's mandate had expired last year. Malik Saidullaev, a 35 year-old businessman, was elected council chairman. Commenting on those developments, Prime Minister Putin said on 7 October that Moscow will cooperate with "all forces in Chechnya intent on a constructive dialogue," ITAR-TASS reported. But he added that "I would not want to create the impression that Moscow is staking on anyone in particular." Saidullaev told ITAR-TASS that he considers the council's most important task to be "purging Chechnya of all those who are a disgrace to the nation." Chechnya's representative in Moscow, Mairbek Vachagaev, told ITAR-TASS that no one in Chechnya will ever support Saidullaev. LF

DAGHESTAN MAVERICK ARRESTED

Russian State Duma deputy Nadirshakh Khachilaev, who played a leading role in the Chechen-led invasions of Daghestan in August, was arrested at an undisclosed location and brought to Moscow on 6 October, Prime Minister Putin announced the following day. The Russian Interior Ministry issued a warrant for Khachilaev's arrest last year following his supporters' failed attempt to seize the government building in Makhachkala (see "RFE/RL Newsline," 21 and 22 May 1998). LF

TAX MINISTER SAYS ONE BANK AT CENTER OF BONY SCANDAL...

In an interview with "The New York Times" of 8 October, Tax Minister Aleksandr Pochinok said that "there is one main bank that was at least the ideological center" of the transfer of billions of dollars through the Bank of New York. The aim of the scheme was to hide income from tax authorities. Pochinok did not name the bank in the article but did reveal that investigators began to focus on Sobinbank after discovering payments made to the bank by Flamingo Bank (see "RFE/RL Newsline," 6 October 1999). In an earlier interview with "Vedomosti," Pochinok said that his ministry's investigations could take many months in part because of the ministry's small staff. JAC

...AS MOST BANK RAIDED

On 5 October, tax police and customs officials raided the offices of Vladimir Gusinskii's Most Bank which owes customs authorities some 650 million rubles ($25.3 million, see "RFE/RL Newsline," 30 September 1999). A State Customs Committee spokesman told "The Moscow Times" on 7 October that if investigators find that Most has "parked funds abroad instead of paying off debts, then sanctions will be imposed against the bank." A Most Bank spokesman accused the Kremlin of trying to pressure the Media-Most group through the bank. JAC

SBERBANK INVESTIGATION AT CENTER OF IMF LOAN DELAY?

IMF officials are delaying the release of the next installment of a loan to Russia because of a dispute over an investigation into Sberbank, the "Financial Times" reported on 8 October, quoting officials close to the investigation. According to the daily, the investigation should have begun a year ago, but fund and Russian officials have failed to agree on terms of the audit. Last week, Mikhail Zadornov, former presidential envoy to international financial institutions, was appointed an adviser to Sberbank. On 7 October, Central Bank Chairman Viktor Gerashchenko told NTV that the IMF's insistence that the Central Bank sell its stakes in banks in other countries is "far-fetched and unrealistic." He added that the bank is ready to sell these stakes should anyone want to buy them. JAC

NEW MILITARY DOCTRINE ALLOWS NUCLEAR WEAPONS USE IN 'CRITICAL' SITUATIONS

Interfax reported on 7 October that the draft of Russia's new military doctrine states that nuclear arms are an "effective factor of deterrence, guaranteeing the military security of the Russian Federation and its allies, supporting international stability and peace." The draft notes that "the Russian Federation reserves the right to use nuclear weapons in response to the use of nuclear or other mass destruction weapons against it or its allies and also in response to large-scale aggression involving conventional arms in situations critical for the national security of Russia and its allies." Among the key security threats listed in the document is the "expansion of military alliances to the detriment of Russian military security." The full text of the draft is to be published soon in "Krasnya zvezda." The 1997 security doctrine also allowed for the first use of nuclear weapons. JC

GOVERNMENT PUSHING FOR RATIFICATION OF TEST BAN TREATY

Foreign Ministry spokesman Vladimir Rakhmanin announced on 7 October that the government is putting the final touches to documents needed to submit the Comprehensive Test Ban Treaty to the State Duma for ratification. Reuters quoted him as saying that Moscow wants the treaty to take effect as soon as possible and be backed by a "viable verification system." Of the five major nuclear powers (the U.S., Russia, Britain, France, and China), only Britain and France have ratified the document. The U.S. Senate is expected to vote on ratification early next week. JC

RUSSIA TAKES 'ANOTHER STEP' TOWARD UNION WITH BELARUS

Russian Prime Minister Putin told reporters on 8 October that publication of the draft treaty on the union of Russia and Belarus is the first step toward the true unification of the two countries, Interfax reported. Putin added that unification is "a complicated matter" and that while the two countries "will not be rushing into it," neither will they remain in one place. The Russian government newspaper, "Rossiiskaya gazeta," and "Sovetskaya Belorussiya" published the treaties on 8 October. Belarus's permanent envoy to the CIS, Sergei Posokhov, called the treaty a "very impressive document" that "removes many worries of Belarusians," according to ITAR-TASS. However, Belarusian President Alyaksandr Lukashenka had a different opinion, calling the document "a laughing stock, not a treaty" (see "RFE/RL Newsline," 1 October 1999). JAC

PUTIN'S STAR IS RISING

A number of recent opinion polls in Russia show that Prime Minister Putin's public approval ratings are rising. Commentator Otto Latsis, writing in "Novye izvestiya" on 7 October, reported that according to data obtained by the Agency for Regional Political Investigations, Putin rose from fifth place last week to third place this week in popularity ratings, overtaking Yabloko leader Grigorii Yavlinskii and Moscow Mayor Yurii Luzhkov. Latsis concludes that a considerable number of Russian citizens "have revised their attitude toward Putin" because of "his precise and effective actions to rebuff terrorists." "Novye izvestiya" receives funding from Boris Berezovskii's LogoVAZ group, while Latsis is reportedly a member of the interregional bloc Unity. Unified Energy Systems head Anatolii Chubais said on 6 October that Putin is a "maximally realistic" presidential candidate, who could find himself even more popular if he "stabilizes the situation in the North Caucasus without serious losses." JAC

ANOTHER BANK FOR THE DUSTBIN...

A Moscow court on 7 October declared Agroprombank bankrupt, "Kommersant-Daily" reported. Agroprombank lost its operating license on 30 July, and soon afterward its sister bank, SBS-Agro sought to have it declared bankrupt. SBS-Agro was also one of Agroprombank's largest creditors, according to "Vremya MN." As of 7 October, Agroprombank owed its creditors a total some 17.7 billion rubles ($688 million), the daily reported. In an interview with "Argumenty i Fakty" (No. 39), Central Bank Chairman Gerashchenko said that his bank has provided 6.5 billion rubles to SBS-Agro since last October and that his bailout was justified because SBS-Agro is "a large system-forming bank with a large number of branches." JAC

...AS PUBLIC TRUST IN COMMERCIAL BANKS REMAINS LOW

Meanwhile, "Novye izvestiya" reported on 7 October that the number of Russian families with savings has declined from 14 percent last year to 11 percent this year, according to polling data from the Russian Center for the Study of Public Opinion. The data also reveal that 53 percent of respondents believe that savings should be kept in hard currency, compared with 48 percent last year. The number of those keeping savings in cash declined to 16 percent from 21 percent, while only 1 percent use commercial banks, compared with 2 percent last year. JAC

LUZHKOV'S WIFE TURNS TO LITIGATION

Yelena Baturina, the wife of Moscow Mayor Luzhkov, filed a lawsuit against the regional directorate of the Federal Security Service (FSB) in Vladimir Oblast and local prosecutors there for their failure to provide a reasonable explanation for why their agents seized financial documents from her firm, Inteko, ITAR-TASS reported on 7 October. Baturina's lawyer has also threatened to sue Sergei Dorenko of Russian Public Television for his claims that Andrei Baturin is a brother of Baturina and holds several accounts in foreign banks, "The Moscow Times" reported on 8 October. Both Baturin and Baturina deny that they are even related. Earlier in the week, Yurii Luzhkov repeated his denial that he intends to run for president in 2000. "I am not going to become president or put myself up for this post," he told "Komsomolskaya pravda" on 4 October. Luzhkov also repeated his accusations that the Kremlin is conducting a propaganda war against him so that he "would not think about the presidential election." JAC

ECONOMIC CRIME RISING IN ARMED FORCES...

Military Prosecutor Yurii Demin said on 7 October that economic crime is steadily rising in the armed forces and other military branches of the Russian Federation, thereby endangering national security. Crimes uncovered by military prosecutors in the first six months of this year cost the armed forces more than $4.7 million, he said. The number of officers found guilty of theft and graft leaped from 1,017 from 1993-1999, compared with 185 over an unspecified period up to 1993, Reuters quoted him as saying. Also from 1993-1999, the number of known cases of bribery in the army rose 82 percent. Two months ago, Demin had announced that some 20 lawsuits against generals and admirals are being considered by military prosecutor's offices around the country. "Izvestiya" reported on 8 October that the average amount embezzled by those officers is 2.23 million rubles ($87,000). JC

...WHILE COMBAT-READINESS PUT AT LESS THAN 10 PERCENT

Ruslan Pukhov, director of the Moscow-based Center for Strategic and Technological Analysis, told "Vremya MN" of 7 October that of the 1.2 million members of Russian armed forces, no more than 100,000 are combat ready. The Russian military is largely composed of military conscripts who serve for two years. Reuters on 7 October quoted defense experts as saying that those conscripts spend the first year training and the last six months preparing to leave. JC

SCIENTOLOGISTS IN MOSCOW LOSE LICENSE TO OPERATE

A Moscow court has declared the registration of the Hubbard Humanitarian Center in Moscow invalid, "Vremya MN" reported on 7 October, citing Ekho Moskvy. In addition, criminal proceedings have been instituted against the Hubbard center and the Church of Scientology under several articles of the criminal code. A Russian Orthodox Church spokeswoman welcomed the ruling, telling Reuters that "our Church is strongly critical of [the Church of Scientology]. We define them as a totalitarian sect." Hubbard center spokesman Aleksei Danchenkov told "The Moscow Times" on 8 October that he believes the center's difficulties with registration and with the tax police are linked with the Orthodox Church's struggle "to re-establish its complete dominance." He added that the center will appeal the court's ruling. JAC

RUSSIAN COMPANIES SIGN CONTRACTS WITH IRAQ WORTH $57 MILLION

Russian Fuel and Energy Minister Viktor Kalyuzhnyi told Interfax on 7 October that Russian companies have signed contracts with Iraq on supplying equipment necessary to increase Iraqi oil output. Those contracts, which are worth $57 million, were signed during Kalyuzhnyi's recent trip to Baghdad (see "RFE/RL Newsline," 4 October 1999). The minister did not name the Russian companies involved or provide any other details. The two sides also concluded a deal on the drilling of 100 wells in the Northern Rumeila oil field. According to a protocol signed during Kalyuzhnyi's trip, Russia and Iraq may set up a joint drilling company. JC




AZERBAIJANI FOREIGN POLICY ADVISER RESIGNS

Vafa Guluzade, who served as foreign policy adviser to successive Azerbaijani presidents, has tendered his resignation to Heidar Aliyev for reasons "connected with his age and deteriorating health," Turan reported on 8 October. In recent months Guluzade has repeatedly called for a NATO, U.S. or Turkish military presence in Azerbaijan to counter Russian- Armenian military cooperation. LF

AZERBAIJANI POLICE, PICKETERS CLASH IN BAKU

Members of the opposition Azerbaijan Popular Front Party and Musavat Party were forcibly dispersed by police on 7 October when they tried to picket the Russian Embassy, Turan reported. The picketers were protesting the 1 October Russian missile attack on a village in northern Azerbaijan, discrimination against ethnic Azerbaijanis in Russia, and the Karabakh policy of the OSCE Minsk Group, of which Russia is one of the three co-chairs. LF

FORMER ARMENIAN PRESIDENT SEES 'NO PROGRESS' ON KARABAKH

In a rare public appearance in Yerevan on 7 October, Levon Ter- Petrossian told journalists he perceives no progress toward a solution of the Karabakh conflict, despite the direct talks over the past three months between his successor, Robert Kocharian, and Azerbaijani President Heidar Aliev, RFE/RL's Yerevan bureau reported. Ter-Petrossian said he does not currently follow domestic political developments in Armenia and currently has no plans to return to politics. He said that the present instability in the North Caucasus constitutes a potential threat to Armenia, just as the Chechen war of 1994-1996 did. LF

PREPARATIONS CONTINUE FOR ELECTION OF NEW ARMENIAN CATHOLICOS

Dioceses of the Armenian Apostolic Church worldwide have elected 451 delegates to participate in the 26-31 October National Ecclesiastical Assembly that will elect a new Armenian Catholicos, RFE/RL's Yerevan bureau reported on 7 October. The Church's 47 bishops, all of whom have the right to be elected catholicos, are ex officio delegates. In an interview with Noyan Tapan on 7 October, interim Catholicos Nerses Pozapalian confirmed that two senior Armenian government officials, whom he declined to identify, have informed Church officials of their preferred candidate (see "RFE/RL Newsline," 29 September 1999). Archbishop Mesrop Mustafian, who is patriarch of Istanbul, told a U.S. radio station on 3 October that President Kocharian and Prime Minister Vazgen Sargsian have informed archbishops that they would like to see Garegin Nersisian, archbishop of the Ararat Diocese (which includes Yerevan), elected catholicos. They added, however, that the Armenian government will not interfere in the election process. LF

GEORGIA REFUSES TO CONDONE DEPLOYMENT OF RUSSIAN BORDER GUARDS ON CHECHEN BORDER

The commander of Georgia's Border Guards, Lieutenant General Valerii Chkheidze, said on 7 October that Tbilisi has categorically rejected Moscow's proposal to station Russian border guards in the Georgian village of Shatili, close to Georgia's frontier with Chechnya, Caucasus Press reported. Chkheidze said if it did so, it would run the risk of Chechen attacks on Georgian territory. He again denied that arms are being transported to Chechnya via Georgia. Georgian Minister of State Vazha Lortkipanidze, for his part, told Russian Television that there is no need for additional Russian border guards on that section of Georgia's border as there are enough Georgian border troops deployed there. Lortkipanidze added that Tbilisi would be grateful for Russian help in providing those Georgian border guards with additional equipment. LF

ADJARA RELEASES PRISONERS

A senior official of the Adjar Autonomous Republic told journalists in Tbilisi on 7 October that the reason for the Adjar authorities' delay in releasing 28 prisoners whom Georgian President Eduard Shevardnadze amnestied on 1 October was that they have not received the relevant documentation from Tbilisi, Caucasus Press reported. He added that 27 prisoners have now been discharged, while no documentation has been received on the eligibility for amnesty of the 28th, who is serving a sentence for the attempted assassination of Adjar Supreme Council chairman Aslan Abashidze. The amnesty does not extend to persons sentenced for terrorism. The Georgian Prosecutor-General's Office had threatened legal proceedings against Adjar prison directors if the men were not released (see "RFE/RL Newsline," 7 October 1999). The Adjar authorities have also released two Georgian Defense Ministry officials detained last month for possession of drugs, "Meridian" reported on 8 October (see "RFE/RL Newsline," 29 September 1999). LF

MORE KAZAKH ELECTION HARASSMENT REPORTED

Amirzhan Qosanov, who is deputy chairman of the Republican People's Party of Kazakhstan, told RFE/RL correspondents in Almaty on 8 October that tax police raided the office of the party's executive committee chairman Ghaziz Aldamzharov on 6- 7 October without a search warrant. As a registered candidate for the 10 October election to the lower house of parliament, Aldamzharov technically enjoys immunity under the election law. LF

GUERRILLAS CONTACT KYRGYZ LEADERSHIP

Senior Kyrgyz Security Ministry official Talant Razzakov said in Bishkek on 7 October that one of the leaders of the ethnic Uzbek guerrillas holding 13 hostages in southern Kyrgyzstan has sent a missive to the Kyrgyz military leadership, RFE/RL's bureau in the Kyrgyz capital reported. Razzakov did not disclose the contents of that document but said the author is believed to be Juma Namangani, an Uzbek citizen who is wanted by the Uzbek authorities on suspicion of masterminding terrorist attacks in that country in 1997. ITAR-TASS on 7 October reported that no large-scale hostilities between the guerrillas and government troops took place over the previous 24 hours. It quoted Kyrgyz official sources as denying media reports that the Kyrgyz troops have opened a second front against the guerrillas near the Uzbek exclave of Sokh. LF

OPPOSITION CANDIDATES TO BOYCOTT TAJIK PRESIDENTIAL POLL

Three opposition candidates told journalists in Dushanbe on 7 October that they will boycott the 6 November presidential election to protest restrictions and harassment by the government, which, they said, prevented them collecting the required 145,000 signatures for registration, RFE/RL's Tajik Service reported. The three candidates are Economics and Foreign Economic Relations Minister Davlat Usmon (Islamic Renaissance Party), Sulton Kuvvatov (Democratic Party/Tehran Platform), and Saiffidin Turaev (Justice Party). Turaev told RFE/RL that the three will hold talks with the Tajik parliament and representatives of international organizations in the hope of reaching a "political solution" that would allow them to contest the poll. LF




BELARUSIAN PRESIDENT GIVES CABINET THREE MONTHS TO IMPROVE RECORD

At a 7 October cabinet session, Alyaksandr Lukashenka harshly criticized the government for its "unsystematic approach to economic policy as well as inconsistency and half-heartedness in dealing with key socio-economic issues," Belapan reported. According to the president, in the first eight months of this year Belarus failed to meet all targets in all key socio-economic spheres except for industrial output, consumer goods output, housing construction, and consumer services. "Twenty one percent of industrial enterprises have no working capital, almost 36 percent have working capitals below the [required] norm. In essence, these enterprises have no future," Belarusian Television quoted Lukashenka as saying. Lukashenka gave the cabinet three months to improve its record. JM

EUROPEAN PARLIAMENT URGES BELARUS TO ENTER DEMOCRATIC PATH

The European Parliament on 7 October adopted a resolution urging Minsk to embark on a path of democratic political and economic reforms and to observe European human rights standards. The resolution appeals to the Belarusian authorities to clarify the recent disappearance of prominent Belarusian oppositionists and guarantee freedom of the press and freedom of expression. It also calls on Lukashenka to allow free and fair presidential elections in 1999 and parliamentary elections in 2000. The European Parliament also stressed that it ceased to recognize Lukashenka's presidential powers after 20 July 1999. JM

UKRAINE, UZBEKISTAN SIGN ECONOMIC COOPERATION DEAL

On 7 October in Kyiv, Ukrainian President Leonid Kuchma and his Uzbek counterpart, Islam Karimov, signed an agreement on economic cooperation for the period 1999-2008, Interfax reported. Ukraine and Uzbekistan expect to increase their trade turnover by 20 percent this year. Uzbekistan confirmed its intention to export cotton in exchange for Ukrainian industrial products, in particular, ferrous alloys and steel. At a news conference the same day, Kuchma and Karimov expressed their concern over Russia's reluctance to sign a package of documents related to the creation of a CIS free trade zone as of 1 January 2001. JM

TALLINN CITY APPROVES BUDGET REDUCTION

Meeting for the last time before the 17 October local elections, the Tallinn City Council on 7 October approved a 101.8 million kroons ($7 million) reduction in its 1999 budget. The large opposition faction of the Reform Party abstained, saying the cuts are not large enough. The party's Tallinn mayoral candidate, Rein Voog, commented that "the Tallinn budget deficit at the end of the year could reach 30 million kroons, if not more," adding that "Tallinn is on the verge of a financial disaster," "Postimees" reported. Before the cut, the 1999 Tallinn budget stood at 2.36 billion kroons. MH

LITHUANIANS TRUST PRESIDENT, OPPOSITION PARTIES AHEAD

In a poll released by Baltijos Tyrimai/Gallup released on 7 October, Lithuanians expressed trust in the presidency more than in any government institution. The presidency held the trust of 72 percent of respondents, followed by the state government (45 percent) and local government (44 percent). Only 20 percent expressed confidence in the parliament. The same poll also revealed that the opposition Center Union continues to top the popularity ratings, with 15.8 percent support. It is followed by the leftist opposition Lithuanian Democratic Labor Party (8.7 percent) and the ruling Conservative Party (7.8 percent). MH

POLISH PARLIAMENT TO WORK ON PROPERTY RESTITUTION BILL

The parliament on 7 October rejected an opposition Polish Peasant Party (PSL) motion to hold a referendum on property restitution. It then voted against another motion rejecting the government-prepared property restitution bill in the first reading and sent it to a parliamentary committee for consideration. Under the proposed bill, Polish citizens seeking compensation for property seized by the communist regime from 1939-1962 can obtain 50 percent of those assets in either the property itself or in shares in privatized enterprises. The PSL has announced it will launch a petition drive for a referendum on the issue. No fewer than 500,000 citizens must sign such a petition. JM

POLAND REJECTS RUSSIAN ALLEGATION OF SUPPORTING CHECHNYA

Polish Foreign Ministry spokesman Pawel Dobrowolski on 7 October rejected Russian accusations that Poland supports "unconstitutional forces in the North Caucasus." Dobrowolski said Poland shares the EU's view on the Chechnya conflict. Dobrowolski was responding to comment by his Russian counterpart, Vladimir Rakhmanin, who had said the same day that Poland "gave shelter to the so-called representatives from the Republic of Ichkeria, the Poland-Chechnya committees, and similar structures," according to ITAR-TASS. JM

CZECH, SLOVAK PREMIERS PLEDGE TO COMPLETE FEDERAL PROPERTY DIVISION

Prime Minster Milos Zeman and visiting Slovak Premier Mikulas Dzurinda pledged in a joint statement on 7 October to complete the division of former federal property by 24 November, TASR and CTK reported. As an immediate step toward that end, they agreed on an exchange of shares in the Czech Komercni banka and the Slovak Vseobecna uverova banka. An accord on that exchange is to be signed by the heads of the two countries' National Property Funds on 8 October. Zeman and Dzurinda said they want to intensify cooperation in order to promote both their countries' integration into the EU. MS

CZECHS ASK WHEN EU TALKS WILL END

Czech Foreign Minister Jan Kavan told Reuters on 7 October that the Czech Republic is urging the EU to set a target date for concluding accession talks with the leading candidates. Kavan spoke after a meeting with EU commissioner for enlargement Guenter Verheugen. He said that a target date "will motivate people in the candidate countries" as well as provide "a strong argument against the Euro-skeptics", who believe the EU is "just paying lip service to enlargement." Verheugen told journalists that "we really want the Czech Republic to become a member as soon as possible." MS

EU OFFICIAL SAYS ROMA 'NOT SLOVAK PROBLEM'

Parliamentary Assembly of the Council of Europe Chairman Lord Russell- Johnston on 7 October told journalists in Bratislava that the Council of Europe "can and must" play "a significant role" in solving the Romany problem because the problem is "not Slovakia's, but Europe's." He said finding a solution "will not be easy and will demand a great deal of money, patience, and time," CTK and SITA reported. Russell-Johnston met with President Rudolf Schuster and parliamentary chairman Jozef Migas. He said the Romany problem will not play a significant role in Slovakia's accession to the EU and added that Bratislava "has already entered the corridor to the EU." MS

SLOVAKIA'S MECIAR RESUMES PUBLIC RALLIES

Former Prime Minister Vladimir Meciar told a cheering crowd of supporters in Banska Bystrica on 7 October that early elections will be held "by 2000 at the latest." He said disaffection will spread and return to power his Movement for a Democratic Slovakia. After returning to head the government, he said, he will immediately resume the construction of highways and housing. "There is money," he said, "but one has to know how to get it," SITA and CTK reported. This was Meciar's first rally since August 1998. MS

HUNGARY DOWNPLAYS RECONCILIATION PARK CONTROVERSY

Hungarian Foreign Ministry State Secretary Zsolt Nemeth told National TV on 7 October that Romanian nationalists who heckled a Hungarian minister and other speakers in the Romanian town of Arad (see "RFE/RL Newsline," 6 and 7 October 1999) have not harmed bilateral ties. He said that the attempts by several dozen to disrupt the ceremony was not a "diplomatic affair" but rather a "psychiatric problem." Hungary is grateful to the Romanian government for returning the statue of the executed generals to the Hungarian community, Nemeth said. However, he blamed local police for failing to keep demonstrators at an appropriate distance. MSZ




SERBIAN OPPOSITION AGREES ON EARLY ELECTION TERMS

Representatives of the main opposition parties agreed in Belgrade on 7 October on conditions for early elections. They will finalize their decisions as early as 14 October and send their conditions to the government for its agreement. The demands include a revision of the media and election laws. The opposition wants a proportional voting system, revised voting lists, and the presence of foreign and domestic poll watchers. The opposition agreed not to form a coalition with any of the parties currently in the government, an aide to the Serbian Renewal Movement's leader Vuk Draskovic noted. A Democratic Party spokesman called the agreement the "best contribution to the fight against [Yugoslav President Slobodan] Milosevic's regime," Reuters reported. The EU has recently placed considerable pressure on the opposition to unite and oust Milosevic. EU foreign ministers have invited 32 opposition leaders to a meeting in Luxembourg on 11 October, the Frankfurt-based Serbian daily "Vesti" reported on 7 October. PM

PROTESTS CONTINUE IN SERBIA

A total of 40,000 people turned out in 15 municipalities on 7 October to demand Milosevic's resignation. The demonstrations passed without incident but were far smaller than the organizers in the opposition Alliance for Change had hoped. The opposition nonetheless intends to continue the daily protests, RFE/RL's South Slavic Service reported on 8 October. PM

SERBIAN REGIME DENIES ROLE IN DRASKOVIC ACCIDENT

Ivica Dacic, who is a spokesman for Milosevic's Socialist Party of Serbia (SPS), said in Belgrade on 7 October that the recent mysterious traffic accident involving Draskovic is a "police matter" without any political significance (see "RFE/RL Newsline," 7 October 1999). Dacic told reporters that they should direct questions about any "assassination attempt on Vuk to those who had a motive to carry one out, and that is not the Socialist Party." AP reported that "the accident has prompted a furious Draskovic to radicalize his so far relatively moderate stance toward Milosevic's regime and pledge to crush it." PM

OFFICIAL'S DEFAMATION CASE AGAINST SERBIAN OPPOSITION POSTPONED

Belgrade Judge Sladjana Bojovic has postponed until 23 November a defamation case against 11 opposition leaders to "give them more time to prepare their defense." An opposition lawyer told Reuters on 7 October that he expects the case to be dismissed. Two days earlier, Serbian Deputy Premier Milovan Bojic filed suit against 11 leaders of the Alliance for Change (see "RFE/RL Newsline," 6 October 1999). Bojic complained that he had been ridiculed at a mock trial held at a Belgrade demonstration. PM

ETHNIC ALBANIANS DEMAND ACCESS TO MITROVICA MINES

Some 1,000 ethnic Albanian miners took part in a protest at the Stari Trg precious metals mine near Mitrovica on 7 October, AP reported. They want to return to their jobs in the mine, which KFOR took over in June. An unspecified number of Serbs continue to work there to keep equipment functioning. Xhafer Nuli, president of the Independent Miners' Union, told the protesters: "We want to live from our work and from our sweat and by our own wages, we don't want to live from humanitarian aid. " Another miner said: "I gave more than 20 years of my life in this mine and for it, so we are ready even to die for our mine. We have to feed our families." Meanwhile, 1,500 ethnic Albanians protested outside the UN offices in Mitrovica, demanding access to schools and the hospital in the northern part of the city, RFE/RL's South Slavic Service reported. FS

REINHARDT SAYS HE HAS NO IMMEDIATE SOLUTION FOR MITROVICA

German General Klaus Reinhardt told AP on 7 October that "I think it would be very arrogant...to come up and offer a solution [to the conflict between ethnic Serbs and Albanians over Mitrovica].... I cannot offer a solution right now, which will work in the future." Reinhardt takes over command of KFOR from General Sir Mike Jackson on 8 October, marking a change of the KFOR command from NATO's Allied Rapid Reaction Corps to Allied Land Forces Central Europe. Reinhardt stressed that "I'm here to help in Kosova...to rebuild for a better future, and this is the mission I have." FS

KFOR ARRESTS SUSPECTED WAR CRIMINAL

A KFOR spokesman told AP that Dutch and German KFOR troops arrested a war crimes suspect in Prizren on 7 October. The spokesman identified neither the man nor his nationality. The International Criminal Tribunal for the Former Yugoslavia has indicted the suspect on charges of murder and other atrocities committed in the Rahovec area between April and June. FS

WORLD BANK APPROVES $60 MILLION FOR KOSOVA RECONSTRUCTION

World Bank officials told dpa in Washington on 7 October that the bank's executive board has approved $60 million over the next 18 months to support reconstruction and economic recovery in Kosova. The official added that the bank will coordinate international aid with the European Commission and other donors, provide economic policy advice to the UN mission and local authorities, and assist with project design in the reconstruction effort. He underlined that the World Bank itself will provide direct limited financial aid on "a highly selective basis." FS

U.K. CALLS FOR CRACKDOWN ON KOSOVA MAFIAS

A Foreign Office spokesman said in London on 7 October that failure to deal with organized crime in Kosova could undermine efforts aimed at promoting democracy and stability. He added that Foreign Secretary Robin Cook will present concrete proposals in Luxembourg aimed at combating mafia-like structures in the province. PM

ALBANIAN GOVERNMENT SETS UP ANTI-CORRUPTION COMMISSION

The government on 7 October set up a commission charged with fighting corruption "at all government levels." It issued a statement saying that the commission will be headed by Deputy Prime Minister and Minister of Government Coordination Ilir Meta and include the ministers of finance, public order, justice, and economy, dpa reported. The commission will receive foreign-expert advice from the Friends of Albania, a group of foreign donors and diplomats sponsored by the OSCE. The OSCE office in Tirana issued a statement saying that the commission is "indispensable for Albania to participate fully in and benefit from the evolving aspects of the Stability Pact in Southeast Europe." FS

OSCE CALLS FOR INVESTIGATION OF ATTACK ON MUSLIM IN SREBRENICA

A spokesman for the OSCE said in Sarajevo on 7 October that his organization demands a "swift and credible investigation" by the Srebrenica authorities and Republika Srpska police into the stabbing of a Muslim official in the Srebrenica municipal building the previous day, Reuters reported. Two masked men beat and stabbed Munib Hasanovic, who works for the government of the formerly mainly Muslim town, which fell to Serbian forces in July 1995. A spokeswoman for the international community's Wolfgang Petritsch said that Hasanovic recently received death threats but there is no "evidence that this has a political background," AP reported. Some Muslim officials work three days a week in Srebrenica but continue to live with their families on Muslim-controlled territory. PM

CROATIAN SERBS SEEK POLITICAL GUARANTEES

Milorad Pupovac, who is a political leader of Croatia's small Serbian minority, said in Zagreb on 7 October that representatives of the Serbian community have written to top government and opposition officials asking them to clarify their respective stands on the Serbs' political rights. Pupovac stressed that the Serbs will not accept any reduction in the rights that current legislation guarantees them, RFE/RL's South Slavic Service reported. PM

ROMANIAN DEPUTY PREMIER SAYS NO DECISION TAKEN ON ARAD HUNGARIAN MONUMENT

Deputy Premier Valeriu Stoica told journalists on 7 October that there is "futile and tendentious agitation" over the monument honoring the 13 Hungarian generals executed in 1849. Stoica said the government's decision to set up a "park of historical reconciliation" in Arad does not specify which monuments are to be displayed there. Whether the monument honoring the generals is included, he said, depends "on the recommendations that will be made by architects and artists." MS

POLL CONFIRMS ROMANIAN OPPOSITION LEADS THE FIELD

An opinion poll conducted by Metromedia Transilvania confirms that the PDSR is well ahead in party preferences, RFE/RL's Bucharest bureau reported on 7 October. The PDSR received 37 percent backing. That is more than the combined support for all members of the ruling coalition: Democratic Convention of Romania (22 percent), the Democratic Party (8 percent) and the Hungarian Democratic Federation of Romania (5 percent). The opposition Alliance for Romania (APR) received 16 percent and the Greater Romania Party (PRM) 7 percent. PDSR chairman Ion Iliescu is leading the field among presidential candidates (34 percent), followed by APR chairman Teodor Melescanu (21 percent), incumbent President Emil Constantinescu (17 percent), PRM leader Corneliu Vadim Tudor (7 percent), and former Premier Theodor Stolojan and Democratic Party leader Petre Roman (5 percent each). MS

MOLDOVA, RUSSIA AGREE ON BARTER PAYMENT FOR GAS DELIVERIES

Moldova will supply agricultural produce to Russia in part payment for Russian gas deliveries, ITAR-TASS reported on 7 October. The agreement was concluded in Chisinau by experts from the two countries' Agriculture Ministries. Moldova is to deliver goods worth $100 million. Its debt for Russian gas deliveries totals $700 million. MS

BULGARIAN MAYORAL CANDIDATE BADLY BEATEN

Vesselin Dinkov, Varna regional governor and the Union of Democratic Forces' (SDS) mayoral candidate in the 16 October local elections, was badly beaten in front of his house on 6 October, BTA reported the next day, citing several media reports. According to "Trud," the attack was an assassination attempt carried out "by the mafia, which has declared war on the state." The same daily reported that the incumbent Socialist Party mayor of one of the districts in the town of Pernik has received death threats by telephone and his office has been burgled. In Bourgas, red paint has been splashed on the billboards of an independent candidate. And "24 Chasa" and "Demokratsiya" reported on 6 October that three blasts, believed to aim at intimidating the SDS mayoral candidate, occurred in Devin. MS




TEN YEARS ON: ECONOMIC VISION STILL NOT A REALITY


By Breffni O'Rourke

Visions, by their very nature, are hard to sustain. When the Berlin Wall fell 10 years ago, heralding a new era in Europe, much of the world had a common vision: namely, that the countries of the crumbling Marxist sphere would join the Western community in enjoying political freedoms and economic prosperity based on market mechanisms.

During the following decade, the dream of democracy has been largely fulfilled--with some exceptions--in a vast arc of territory stretching from the Baltic to the Black Sea.

Economic well-being, however, has proved more elusive, and the revitalization of CENTRAL AND EASTERN EUROPE is still an unfinished story. The transition to market economies has not been easy, and the relative success or lack of success of individual countries reflects a mix of complicated factors.

Only Poland among the transition states has lifted its economic prosperity well above the level of 1989. Polish per capita incomes this year are expected to reach about 130 percent of 1989 levels. At the other end of the spectrum, Ukraine, with a stalled reform process, has seen people's incomes plummet to half the levels of 1989.

Because Poland opted for radical reforms, the simple conclusion might be that the so-called "big bang" method produces the best results, despite its high social costs. Hungary, too, has successfully opted for a radical course, but Slovenia, Slovakia, and the Czech Republic have income levels equal to or greater than that of Hungary--about 100 percent of their 1989 levels--and have chosen more gradualist paths.

A senior economist with the Paris-based Organization for Economic Cooperation and Development (OECD), Val Koromzay, told RFE/RL that the real lesson of the last decade lies not in a choice between big bang or gradualism. Rather, the lesson is that the essential factor is coherent reform. He says time has been reasonably forgiving of countries that have been slower or faster. Those that got into trouble did so because they backtracked away from reform, owing to political opposition or perceived hardship.

Poland, Koromzay argued, was "always moving in the same direction and despite numerous changes of government, I think one can see clearly a thread of continuity, a direction."

Romania, by contrast, has lacked this sense of purpose, and its political will has faded, Koromzay argued. Nervous governments have sought to spare the population the pain of restructuring, he noted, but instead they have condemned the people to the continuation of miserable living standards with little prospect of improvement.

"In Romania from the beginning there was this terrible concern about hardships that transition would cause," he commented. "Every time they came to a hard decision, for instance on tightening budget constraints on enterprises, too often they blinked. And that in turn...made their macro- economic policies incoherent."

With regard to Bulgaria, Koromzay said that it wasted the early years of transition under non-reformist governments. Its industrial production is still one-third less than it was in 1989, but recently there has been fresh momentum under reformist Prime Minister Ivan Kostov. Koromzay noted that this is encouraging: Bulgaria, he commented, "did not get its act together for a number of years. But it shows on the one hand how costly it is to delay, but on the other hand that if you can get your act together even at a rather late date, the possibilities for breaking out of a very bad situation continue to exist."

Progress across the transition region is needed soon, because after a decade of profound change, people are weary. In the Czech Republic, opinion polls show growing support for the Communists among frustrated voters. Similarly in eastern Germany, recent state elections show strong support for the former Communists. And in Poland, populist-nationalist trends opposed to reform are evident.

Another expert in the region's transition process, Giovanni Cornia of the United Nations University in Helsinki, told RFE/RL that democracy "with falling incomes and rising mortality is not a particularly attractive type of democracy."

Cornia also advanced a theory to explain, at least in part, why some countries have done better than others: the countries that are succeeding today are those that have a better-developed institutional framework, dating in part from before the communist era. In other words, those countries of Central Europe that were traditionally more institutionally advanced than, say, their neighbors in the Balkans, are the ones that will lead the race back into the market economy today.

That historical advantage has also helped countries like Poland, Hungary, and the Czech Republic gain places as front- runners for membership of an expanded European Union. In turn, Cornia says, the hope of entering the EU has been a powerful motivation. The author is a Prague-based RFE/RL correspondent.


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