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Newsline - June 21, 2000




FEDERAL PROSECUTOR SEEKS TO OVERTURN PRIVATIZATION DEAL...

The Office of the Prosecutor-General on 21 June filed suit in a bid to invalidate the privatization of part of Norilsk Nickel, a giant metals producer. According to Interfax, prosecutors are claiming that the shares were sold illegally to Interros head Vladimir Potanin and that the purpose of the suit is to "return the stake in Norilsk Nickel unlawfully obtained from the government." Potanin's Oneksimbank paid $170 million for 38 percent of the company's shares in 1997 as part of the controversial "loans-for-shares" scheme. Deputy Minister for Property Relations Sergei Molozhavyi said that the deal has already been considered by various courts and federal agencies, all of which confirmed the legality of the transaction. Following news of the legal action, shares in the company sunk 8.6 percent, while shares of all companies fell 4 percent, according to "Kommersant-Daily" on 21 June. JAC

...AS OBSERVERS SUGGEST PUTIN HAS LAUNCHED NEW ATTACK ON OLIGARCHS

Potanin was one of the 17 "oligarchs" who signed the appeal last week protesting the detention of Media-MOST head Vladimir Gusinskii, and some members of Russia's political elite are wondering if the prosecutor-general's action is part of a broader government campaign against oligarchs. During his election campaign, Russian President Vladimir Putin had promised "to strip oligarchs of their proximity to power" (see "RFE/RL Newsline, 29 February 2000). Head of the Russian Regions faction Oleg Morozov asked whether "a war has broken out between the authorities and Russian oligarchs?" An unidentified source at Interros hinted to the 21 June "Segodnya," which is owned by Media-MOST, that Unified Energy Systems head Anatolii Chubais might be the next "victim," since his name came immediately after Potanin's on the letter defending Gusinskii. "Kommersant- Daily," which is controlled by Boris Berezovskii, warned that if this suit is followed by others, the consequences "will be catastrophic for all Russian businesses." JAC

BEREZOVSKII CONTINUES TO CRITICIZE PUTIN...

Addressing a conference of investors in Moscow on 20 June, business magnate Berezovskii praised President Putin's economic policies but suggested that "in the political sphere [Russia] is moving toward a rigid authoritarian system." He continued that Putin is "destroying the model of government developed by first President Boris Yeltsin." Berezovskii concluded that "the political reforms the authorities are now proposing are wrong, while the economic reforms it proposes are absolutely correct." Earlier this month, Berezovskii harshly criticized President Putin's proposed administrative reform of the Russian Federation (see "RFE/RL Newsline," 31 May and 2 June 2000). JAC

...AS HE PLACES MORE PERSONNEL AT ORT...

Analysts continue to debate whether Berezovskii's recent criticisms are sufficient evidence of the rift between the oligarch and Putin. Meanwhile, on 20 June at a general meeting of shareholders of Russian Public Television (ORT), it was announced that Berezovskii's daughter, Yekaterina Berezovskaya and his protege, anchorman Sergei Dorenko, are new members of ORT's board of directors. JAC

...AND SUBJECTED TO IMPROMPTU GRILLING

"The Moscow Times" reported on 21 June that during the question-and-answer period following Berezovskii's remarks, foreign businessmen posed angry questions, accusing him of running his businesses into the ground. One member of the audience asked, "Could you explain how it is every time you've been involved with a company, its capitalization has run down to zero?" Another wanted to know why there is a lack transparency in the structures of the companies in which Berezovskii has been involved. JAC

DUTIES RESHUFFLED IN PRESIDENTIAL ADMINISTRATION

Presidential chief of staff Aleksandr Voloshin has signed an order redistributing the duties of his deputies, Interfax reported on 20 June. Deputy chief of staff Dmitrii Medvedev will be responsible for overseeing Putin's schedule, which was previously the duty of another deputy, Igor Sechin. Sechin will now head the presidential office and submit decrees, instructions, and documents for Putin's approval. Vladislav Surkov has been put in charge of the strategic domestic policy department and relations with the State Duma, Federation Council, Central Election Commission, and Supreme Court. Dmitrii Kozak, as head of the main legal department, will be responsible for overseeing the adjustment of local laws to comply with the federal constitution. The status of first deputy head Igor Shabdurasulov remains unresolved because Putin has still not accepted his resignation. "Segodnya," which is owned by Media-MOST, suggested that Voloshin has lost some of his powers to his deputies as a result of the outcry over the arrest of Gusinskii. JAC

GUSINSKII PINS BLAME ON PUTIN, NOT VOLOSHIN

In an interview with his own NTV on 20 June, Media-MOST head Gusinskii said that he is "sure" that President Putin knew about the 11 May raid on Media-MOST headquarters and that he "is convinced that it is the president who made the decision" about his arrest. Gusinskii added that he thinks presidential chief of staff Voloshin learned of his arrest "from television reports, though this by no means relieves him of the responsibility for what happened." Asked about a schism in Russia's Jewish community, Gusinskii said that there is no split but "the authorities would like to have a convenient and controlling position in the Jewish communities" (see "RFE/RL Newsline," 14 and 19 June 2000). JAC

YABLOKO, SPS SIGN ACCORD JOINING FORCES

State Duma deputy speakers Vladimir Lukin and Irina Khakamada have signed a preliminary agreement merging their respective groups, Yabloko and the Union of Rightist Forces (SPS), Interfax reported on 21 June. (see "RFE/RL Newsline," 16 June 2000). According to the agreement, the two groups will present a single list of candidates for the next State Duma election as well as jointly endorse candidates in local elections after 1 September 2000. The organizational-legal form of the new coalition will be resolved no later than December 2000, according to the agreement. In an interview with "Izvestiya" that day, Khakamada said the agreement was signed by the deputy speakers since Yabloko has only one leader and SPS has four, which, she said, could have caused a number of disagreements. JAC

STUDENTS SAY FSB TRIED TO RECRUIT THEM TO SPY ON YABLOKO

Two students at the Baltic State University have sent a letter to Yabloko leader Grigorii Yavlinskii saying that the Federal Security Service (FSB) sought to recruit them to spy on the activities of the political movement, "The St. Petersburg Times" reported on 20 June. Dmitrii Barkovskii and Konstantin Suzdal said that FSB officials called them into an office at the university late last month and questioned them about matters related to the St. Petersburg branch of Yabloko, for which the two students have worked. According to Barkovskii and Suzdal, the FSB agents were interested in, among other things, the source of Yabloko's election campaign funds and why the movement has so many young members. Yavlinskii, meanwhile, has sent a letter to Prosecutor-General Vladimir Ustinov requesting an investigation into the legality of the FSB's actions. Both the students' and Yavlinskii's letters are posted on Yabloko's website at . JC

FOREIGN TRADE SURPLUS SOARS

Russia's foreign-trade surplus during the first four months of 2000 totaled $18.4 billion compared with $9.1 billion during the same period the previous year, Interfax reported on 20 June, citing the State Statistics Committee. Foreign-trade turnover totaled $44.9 billion from January to April, a 28.2 percent increase over last year. Exports swelled by 43.1 percent to total $31.6 billion. "Kommersant-Daily" on 21 June attributed the rise in exports mainly to growth in the price of raw materials on world markets. It also said the increase could be attributed to a much smaller extent to the increase in the volume of exports. JAC

RANKS OF OFFICIAL UNEMPLOYED DIMINISH SLIGHTLY

The number of unemployed people as of 1 June totaled 8.49 million, a decline of 1 percent compared with 1 May, according to the State Statistics Committee on 20 June. That figure represents a decline of 6.8 percent, compared with 1 June 1999. JAC

NEW PRO-MOSCOW CHECHEN LEADER INAUGURATED...

Akhmed-hadji Kadyrov traveled to Gudermes on 20 June where Russian presidential envoy to the North Caucasus Viktor Kazantsev presented him to local administrators. Several of those officials announced their resignations on the spot, saying they could not work with Kadyrov. In Moscow, presidential aide Sergei Yastrzhembskii admitted in an interview with the independent NTV that opposition to Kadyrov's appointment has precipitated "a crisis. And we have to deal with it as quickly as possible," Reuters reported. Kadyrov, for his part, again appealed to all Chechens to cooperate in the task of stabilization and reconstruction. He rejected proposals to relocate the administrative capital of Chechnya from Grozny to Gudermes (see "RFE/RL Caucasus Report," Vol. 3, No. 15, 14 April 2000). LF

...AS RUSSIAN GOVERNMENT REPRESENTATIVE IMPLICATED IN UNSANCTIONED OIL SALES

"Nezavisimaya gazeta" on 21 June suggested that outgoing Russian government representative in Chechnya Nikolai Koshman may have been behind the refusal of some local officials to cooperate with Kadyrov. The newspaper noted that tensions between the two men have been apparent for months and that Koshman himself had hoped to be named either temporary Chechen leader or at least deputy to Kazantsev. Koshman was passed over for the former position, however, because he had alienated not only the Chechen population but also the Russian military leadership. His future career is now in jeopardy following allegations by Rosneft spokesman Aleksandr Stepanenko on 20 June that he illegally sold Chechen oil in Ingushetia for far less than market prices, "Kommersant-Daily" reported on 21 June. LF

RUSSIA CLAIMS PROGRESS IN MISSILE TALKS WITH U.S.

Russian Deputy Foreign Minister Georgii Mamedov told reporters in Oslo on 21 June that he and his U.S counterpart, Deputy Secretary of State Strobe Talbott, have made progress during two days of talks aimed at resolving differences over missile defense. He gave no further details. A spokesman for the U.S. embassy in the Norwegian capital said that the talks could be described as "open and constructive." He added that no statement on the meeting was planned. JC

MOSCOW URGES CLOSER MILITARY TIES WITH BEIJING

Meeting with top Chinese defense officials in Moscow on 20 June, Russian Defense Minister Igor Sergeev called for greater cooperation between Moscow and Beijing in the military sphere, saying such ties are important not only for bilateral relations but also for international security, Interfax reported. The two sides also discussed U.S. plans to deploy its own limited national missile defense system, Colonel General Leonid Ivashov, the head of the Russian Defense Ministry's international military cooperation department, added. According to AP, the Chinese delegation was led by Colonel General Xu Caihou of China's Central Military Commission. JC

RUSSIA-NATO PARLIAMENTARY RELATIONS TO RESUME BEFORE FALL?

Dmitrii Rogozin, chairman of the State Duma Committee for International Affairs and a member of the People's Deputy faction, has said he believes parliamentary-level relations between Russia and NATO could be resumed before the start of the lower house's fall session, Interfax reported on 20 June. Rogozin noted that the Duma will begin debating the issue on 27 June. Contacts between Moscow and the alliance at the ambassadorial level were restored earlier this year (see "RFE/RL Newsline," 16 March 2000). JC

HERMITAGE, GUGGENHEIM TO SHARE OLD MASTERS

The cash-strapped State Hermitage Museum and the Solomon R. Guggenheim Foundation have concluded a long-term deal to develop an international network of museums and share parts of their vast collections, AP reported on 20 June. Neither side would say how much that deal is worth, according to the news agency. However, they did reveal that their cooperation plans include developing new exhibition space in St. Petersburg's General Staff Building, which is close to the Hermitage, and securing a presence for the Russian museum at the proposed new Guggenheim Museum in New York's lower Manhattan. JC




LAWYER DENIES ARMENIAN PARLIAMENT SHOOTING SUSPECTS ACTED TO ORDER

Nairi Hunanian, the leader of the five gunmen who shot eight people dead in the Armenian parliament building on 27 October, continues to maintain that he was not acting on anyone's instructions, his lawyer, Artashes Pahlavuni, told RFE/RL's Yerevan bureau on 20 June. The military investigators charged with the case initially assumed that the gunmen were acting on orders and that the shootings were intended as part of a coup attempt. Pahlavuni said Hunanian has compiled a 100-page testimony expanding on his initial statement that desperation and anger at the deteriorating economic situation prompted him to mastermind the killing of Prime Minister Vazgen Sargsian. The investigation into the shootings is expected to be completed shortly, but the trial of Hunanian, his four accomplices, and several persons accused of abetting them is unlikely to begin before October. LF

KARABAKH ELECTION RESULTS ANNOUNCED...

Sergei Davidian, who heads the Central Electoral Commission of the unrecognized Nagorno-Karabakh Republic, has confirmed the preliminary results of the parliamentary poll two days earlier, ITAR-TASS reported on 20 June. Of the 33 deputies, all of whom were elected in single-mandate constituencies, 13 represent the Democratic Artsakh party, which supports the leadership of President Arkadii Ghukasian, Nine are from the Armenian Revolutionary Federation--Dashnaktsutiun, one belongs to the center-right Armenakan party, and the remainder are independents, most of whom support Ghukasian. Of the 19 deputies to the outgoing parliament who contested the poll, six were re-elected, including speaker Oleg Esayan. Davidian said that the poll was valid but conceded there were inaccuracies in voter lists. LF

...AS AZERBAIJAN SAYS POLL WAS INVALID

In a statement published in the official newspaper "Bakinskii rabochii" on 20 June, Azerbaijan's Central Electoral Commission said the Karabakh poll was not valid as the enclave's former Azerbaijani population were not able to cast ballots, AFP reported. In 1988, Azerbaijanis accounted for approximately 20 percent of the population of the Nagorno-Karabakh Autonomous Oblast. The statement described the poll as "an attempt to give an air of legitimacy to a criminal regime." LF

SOUTH CAUCASUS PRESIDENTS DISCUSS REGIONAL CONFLICTS WITH PUTIN

Armenian President Robert Kocharian and his Azerbaijani counterpart, Heidar Aliev, met one-on-one in Moscow on 20 June ahead of the CIS summit and then jointly with Russian President Vladimir Putin to discuss the Karabakh conflict, Russian and Azerbaijani agencies reported. No details of those talks were disclosed. Georgian President Eduard Shevardnadze later joined the three heads of states for talks on regional conflicts, strengthening security in the South Caucasus, and cooperating to fight international terrorism, according to Interfax. In a joint statement, the four presidents "expressed their readiness to consider specific steps for settling bilateral and multilateral relations, which will provide for the regulation of the conflicts in the region," Caucasus Press reported. They also welcomed international initiatives aimed at expediting a solution to those conflicts. The four presidents pledged to meet regularly at least twice a year on the sidelines of CIS summits. LF

PUTIN SOFTENS RHETORIC TOWARD GEORGIA

In a separate meeting with Georgian President Shevardnadze, Putin hinted that Russia may reconsider its proposal last November to introduce a visa regime with Georgia, Caucasus Press reported (see "RFE/RL Newsline," 4 November 1999). Putin said Russia "does not want to create difficulties" for residents of the two countries by doing so. He also said that Moscow is ready to consider Georgian proposals on rescheduling payments of its debts. Putin said Moscow is interested in a swift settlement of the Abkhaz and South Ossetian conflicts as stability in the Caucasus is beneficial to Russia. Both presidents greeted the decision of the CIS foreign ministers, who met in Moscow on 20 June, to extend until 31 December the mandate of the CIS peacekeeping force in Abkhazia. Putin and Shevardnadze also agreed on the need to continue talks on the terms of the withdrawal of Russia's military bases from Georgia. LF

NEW GEORGIAN AGRICULTURE MINISTER OUTLINES REFORM PROPOSALS

Meeting on 20 June with ministry staff, Davit Kirvalidze warned that he intends to replace his deputies and advisers and to implement structural reform within the ministry, Caucasus Press reported. He said that he envisages the ministry as flexible and working "on European principles" to provide prompt and effective assistance to Georgia's farmers. Kirvalidze also hinted that he will lobby for a reduction of value-added tax on agricultural produce, noting that the present rate of 20 percent is a deterrent to small farmers to increase production. LF

ADJARIA AGAIN ON COLISION COURSE WITH TBILISI

In a move that may exacerbate longstanding tensions between Adjaria and the central Georgian government, Adjar Supreme Council chairman Aslan Abashidze told journalists in Batumi on 20 June that he intends to raise customs duties to compensate for the revenue shortfall in the national budget, Caucasus Press reported. Georgian Minister for Economic, Trade and Industry Vano Chkhartishvili commented that altering customs tariffs is the prerogative of the national parliament. LF

LARGE WEAPONS CACHE DISCOVERED IN KYRGYZSTAN

Kyrgyz border guards have discovered more than 3 tons of arms hidden near the village of Khadji-Achkhan in Batken Oblast, Interfax reported on 20 June. The cache included four grenade launchers, several missile launchers, and a large number of anti-personnel and anti-tank mines. LF

CIS PEACEKEEPING OPERATION IN TAJIKISTAN TO BE TERMINATED

The CIS Council of Foreign Ministers decided at its meeting in Moscow on 20 June not to renew the mandate of the CIS peacekeeping force deployed in Tajikistan since 1993, Russian agencies reported. Colonel General Leonid Ivashov, who heads the Russian Defense Ministry's Department for International Military Cooperation, said that peace process in Tajikistan has reached a stage where peacekeeping activities need to be replaced by concerted efforts by the country's police and armed forces to combat "international terrorism" and "extremism." Kyrgyz Presidential spokesman Osmonakun Ibraimov had told journalists in Bishkek the previous day that Kyrgyzstan would like the CIS peacekeeping force to remain in Tajikistan "to provide security and stability" in Central Asia, Interfax reported. LF




BELARUSIAN OPPOSITION PROPOSES POSTPONING PARLIAMENTARY ELECTIONS

Adrian Severin of the OSCE Parliamentary Assembly and Jan Wirsma of the European Parliament met with the Consultative Council of Belarusian opposition parties on 20 June, RFE/RL's Belarusian Service reported. Belarusian oppositionists told the European mediators that they are not afraid of this fall's elections but do not want to participate in an "electoral farce" that could legitimize the current "pseudo-parliament"--the Chamber of Representatives. Vintsuk Vyachorka, leader of the Belarusian Popular Front, proposed that the ballot be postponed for six months in order to give the authorities time to improve the country's electoral legislation and political climate. Severin assured the opposition that the OSCE continues to insist that the Belarusian regime amend the electoral code, give the opposition access to the media, expand the powers of the legislature, and stop political persecution. JM

BELARUSIAN PRESIDENT REPORTEDLY REJECTS 'MOST IMPORTANT' ELECTORAL CODE CHANGES

Alena Skryhan of the opposition Belarusian Communist Party said that President Alyaksandr Lukashenka has rejected the "most important" amendments to the electoral code proposed by the "sociopolitical dialogue," RFE/RL's Belarusian Service reported on 20 June. Of the original 17 proposed amendments, Lukashenka submitted only 10 to the Chamber of Representative for approval. According to Skryhan, Lukashenka rejected proposals on giving the opposition the right to fill up to 30 percent of the electoral commissions, lowering the valid election turnout to 25 percent, making authorized copies of electoral commissions' records available to election observers, and abolishing the practice of early voting. "The constructive forces of the sociopolitical dialogue...formulated their wishes in a loyal and fully acceptable form," Belarusian Television quoted Alyaksandr Kozyr of the Chamber of Representatives as saying. JM

UKRAINIAN CABINET SUBMITS 'REVOLUTIONARY' TAX CODE DRAFT TO PARLIAMENT

The government has submitted a new tax code draft to the Supreme Council, the "Eastern Economist Daily" reported on 20 June. State Tax Administration head Mykola Azarov called the document "revolutionary." If the code is passed, Ukraine would have the lowest tax rates in Europe. The draft proposes lowering value-added tax to 17 percent in 2001 and to 15 percent in 2002. The proposed corporate income tax for 2001 is 25 percent (currently 30 percent), dropping to 20 percent in 2003. Personal income tax is currently within the 10-40 percent bracket and is to drop to 10-20 percent. Julian Berengaut of the IMF, who is currently visiting Kyiv, has warned that the proposed new code would reduce budget revenues too sharply. He urged the government to study the changes more carefully, according to AP. JM

EU PRAISES CHANGES TO ESTONIAN LANGUAGE LAW

The EU has welcomed amendments, enacted last week, to bring Estonia's language law into line with international standards and help the integration of the non-Estonian speaking minority into Estonian society, Reuters reported on 20 June. The government of Portugal, which holds the six-month revolving EU presidency, issued a statement in Lisbon saying "the EU considers these measures taken by Estonia to constitute extremely encouraging signs of a positive shift in the process of integration." Estonia's parliament on 14 June relaxed the conditions governing the use of Estonian as the official language in the private sector. AB

ANONYMOUS GROUP THREATENS LATVIAN CIVIL ORDER

An anonymous group calling itself "Fighters of Democratic Latvia" has sent a letter to several Latvian newspapers claiming responsibility for a recent explosion on a railway track and threatening more explosions if Soviet war crimes suspects are not released, BNS reported 20 June. The letter, received by "Diena," "Biznes & Baltija," "Chas," "Vesti," and "Panorama Latvii" said, "The explosion on the railway was an urgent message to the ruling Fascist regime about our patience having run out." It called for three men charged with war crimes in Latvia to be released immediately. It also demanded legalization of the Communist Party, equal status for the Russian language, and an end to the humiliation of Russian speakers. AB

IGNALINA DONOR CONFERENCE MEETS GOAL

More than 200 million euros ($185 million) were pledged for the decommissioning of Lithuania's nuclear power plant at Ignalina on the first day of an international donor conference in Vilnius, BNS and ELTA reported on 20 June. Technical assistance was also pledged in the decommissioning process, which is to begin in 2005. The bulk of the funding, 150 million euros, is to come from the European Commission, while EU member countries, the Nordic countries, Switzerland, Poland, and the U.S. pledged the balance. The German agency dpa reported that Bulat Nigmatulin, deputy minister of the Russian Ministry of Atomic Energy, offered to lease the Ignalina power plant for $300 million per year, arguing that "there are no technical grounds for decommissioning the [Ignalina plant] since reactors of this type are safe today." The EU has demanded that all EU candidates agree to close their Soviet-built RBMK-type reactors before they can be considered for membership. AB

LITHUANIAN PARLIAMENT SLAMS PUTIN'S FOREIGN POLICY

Lawmakers have passed a strongly worded resolution charging Russia with making territorial claims against Lithuania, AP and BNS reported 20 June. The resolution, which passed by a vote of 63 to zero in the 141-seat parliament, is a response to Russian President Vladimir Putin's statement in Berlin last week that any NATO enlargement that includes Lithuania, Latvia, and Estonia would be a security threat to Russia and would undermine European stability. The resolution states that by assuming the right to prevent countries from joining the defensive alliance, Russia appears to be making "territorial claims." Speaker of the parliament Vytautas Landsbergis said "Lithuania will not give up one of its basic foreign-policy goals just because someone threatens us." Members of the opposition parties boycotted the vote. AB

POLISH GOVERNMENT FINDS EXTRA MONEY FOR POLICE

The government has earmarked 25 million zlotys ($6 million) from the budget reserve to increase wages for the police, Polish Television reported on 20 June. Polls indicate that one in four police families in Poland are living below the poverty line, that is, they have less than 300 zlotys ($70) per family member each month. After the expected pay rises, a new police recruit will earn an additional 200 zlotys a month. In comparison with international standards, the Polish police are undermanned by some 20,000 troops. JM

PRESIDENTIAL ELECTION COMMITTEES BEGIN TO REGISTER IN POLAND

The Central Electoral Commission on 20 June registered the election committees of two presidential hopefuls, Dariusz Grabowski and Andrzej Olechowski, PAP reported. According to the electoral law, a committee may register if it consists of at least 15 people and submits at least 1,000 signatures in support of its candidate. A candidate may register only if his/her committee supplies at least 100,000 signatures in his/her support by 24 August. So far, more than 10 candidates have declared their intention to run in the 8 October presidential ballot. JM

CZECH PREMIER FAILS TO PERSUADE OWN SENATORS ON CRUCIAL LAW

Milos Zeman met with members of his Social Democratic Party (CSSD) group in the Senate on 20 June in an attempt to persuade them to back the amendments to the electoral law approved by the Chamber of Deputies, CTK reported. About one- third of the 23 CSSD senators said they "have reservations" about the bill, which gives larger parties an advantage over smaller ones. Zdenek Vojir, leader of the CSSD group in the Senate, refused to tell CTK how many of the party's senators will vote against the bill, which requires the backing of 41 out of a total of 81 senators to pass. The bill is expected to be debated before the end of the month. MS

CHINESE PARLIAMENTARY CHAIRMAN IN SLOVAKIA

Li Peng met with Slovak Prime Minister Mikulas Dzurinda and parliamentary chairman Jozef Migas on 20 June to discuss economic ties between the two countries, AP and CTK reported. Speaking to journalists after the meeting, Dzurinda avoided answering a question on whether he raised with Li the issue of respect for human rights, as Amnesty International had urged him. He said he had "made it clear" that Slovakia backs "the same principles as NATO and the EU." The Democratic Party, which is a junior coalition partner, protested the visit. Frantisek Sebej, deputy chairman of that party, told TASR that "Li is not a representative of a democratically elected parliament but of a country under totalitarian rule." A spokeswoman for Migas said the speaker assured Li that Slovakia abides by the "one China" policy. MS

STUDY SAYS CORRUPTION WIDESPREAD IN SLOVAKIA

A research study conducted by World Bank and USAID says corruption is widespread in Slovakia and that the situation has improved "only slightly" since Dzurinda's cabinet came to power in 1998. Presenting the findings to journalists on 20 June, Dzurinda said the study shows corruption is prevalent in the judiciary, the custom service, the National Property Fund, the police, and other state institutions. He said the government will discuss a program to combat corruption at its 21 June meeting, CTK reported. Meanwhile, AP reported on 20 June that the parliament has amended the law on bankruptcy to bring it into line with European standards. As of 1 August, creditors will have the right to appoint their own bankruptcy administrator, and proceedings must be finalized within 18 months. MS

HUNGARIAN PARLIAMENT PASSES MILITARY REFORM BILL

The parliament on 20 June approved the guidelines of a long-term military reform that would bring the Hungarian armed forces up to NATO standards. The reform will be implemented in three stages between 2000 and 2010. In the first stage, the office of the chief of staff will be integrated into the Defense Ministry by the end of this year and army personnel will be cut from the present 61,500 troops to 42,900 by the end of 2003. During the second and third steps, the military will upgrade equipment and start purchasing new equipment. Parties of the governing coalition rejected the opposition Free Democrats' proposal to replace compulsory military service with a professional army. MSZ




DEL PONTE: KOSOVARS MAY FACE WAR CRIMES CHARGES

Carla Del Ponte, who is the chief prosecutor for the Hague-based war crimes tribunal, said in Prishtina on 21 June that "we are investigating [Kosova Liberation Army's (UCK)] activity during the [1998-1999] conflict. Our mandate is always to look at the highest responsibility in the chain of command, and that is also the case for the [UCK]," AP reported. She mentioned that her experts are investigating five specific incidents, but she did not elaborate. She noted that prosecutors are considering "additional indictments of Serbs and non-Serbs, especially [ethnic] Albanians." Referring to Yugoslav President Slobodan Milosevic, Del Ponte said that her investigators are "also investigating the criminal responsibility of Milosevic for [the wars in] Bosnia and Croatia." She mentioned the "possibility of further counts...against Milosevic," whom the tribunal indicted in May 1999 in connection with atrocities in Kosova. PM

HOLBROOKE SLAMS HAGUE TRIBUNAL'S CRITICS

U.S. Ambassador to the UN Richard Holbrooke said in New York on 20 June that charges by Belgrade, Moscow, and Beijing that the tribunal is anti-Serb are "not only not proven--they are not accurate." He added that he can hardly "wait for the day" when former Bosnian Serb leaders Radovan Karadzic and General Ratko Mladic appear in The Hague. Holbrooke stressed that "long- term peace and stability in the Balkans will not be possible as long as the current leadership in Belgrade is in power," Reuters reported. PM

HAGUE'S JORDA WARNS AGAINST DEAL WITH MILOSEVIC

In New York on 20 June, Chinese envoy Shen Guofang "lectured" Hague tribunal President Claude Jorda, Reuters reported. Shen told Jorda that the tribunal has become "a political tool [against the Serbian leadership]...because you are affected too much by politics." Russian Ambassador to the UN Sergei Lavrov said that the tribunal has taken an "anti-Serb line." Later at a press conference, Jorda denied that charge. Referring to a recent story in the "New York Times" about a possible deal to allow Milosevic to go into exile without fear of prosecution, Jorda said that such a move "would be a severe blow" to the tribunal (see "RFE/RL Balkan Report," 20 June 2000). Jorda stressed that "Milosevic...is an indicted criminal. He should be at The Hague." Meanwhile in Athens, a government spokesman denied any Greek role in possible negotiations over Milosevic's future, RFE/RL's South Slavic Service reported. PM

MONTENEGRO CHARGES SIX IN DRASKOVIC CASE...

The Montenegrin police filed charges in Podgorica on 20 June against six Serbs from the Belgrade area in connection with the recent attempt on the life of Serbian opposition leader Vuk Draskovic (see "RFE/RL Balkan Report," 20 June 2000). Two of the six, namely the brothers Milan and Ivan Lovric, are in custody. Vladimir Jovanovic and Dusan Spasojevic remain at large, as are two other persons whose names have not been released. The Lovric brothers are slated to testify in a Podgorica court on 21 June. The Montenegrin police appealed to their Serbian colleagues to help arrest the four persons who are on the run. The Serbian police have not responded to Podgorica's request, the BBC's Serbian Service reported. PM

...PRESENTS EVIDENCE AGAINST THEM

Montenegrin police representatives said in Podgorica on 20 June that they know where the assailants lived while stalking Draskovic in Budva and carefully planning the attempted killing. The police found nearby the 7.65 millimeter Beretta gun used in the assault, which the Lovrices, Jovanovic, and Spasojevic allegedly carried out. They fired eight bullets at Draskovic as he was watching television. The police findings are summed up in a three-page report. PM

DRASKOVIC WAITS IN MONTENEGRO

Draskovic is currently in Budva under heavy police protection, RFE/RL's South Slavic Service reported on 20 June. He is recovering from slight wounds, including a pierced left earlobe and a grazed right temple. He told reporters that he will stay in Budva and conduct the affairs of his Serbian Renewal Movement from there for at least the time being. In Belgrade, Democratic Party leader Zoran Djindjic told "Blic" of 21 June that Draskovic has broken off all contact with other opposition leaders, with whom he had planned to discuss a common election strategy. PM

SERBIAN COUPLE SHOT IN PRISHTINA

Unknown attackers shot and wounded a Serbian couple in central Prishtina on 20 June, a KFOR spokesman said the following day. Both victims are now in stable condition, Reuters reported. Del Ponte and Bernard Kouchner, who is the UN's chief civilian administrator in Kosova, condemned the shooting. PM

SERBIAN AUTHORITIES TAKE MORE STEPS AGAINST OPPOSITION

Zoran Andjelkovic, who was Milosevic's last governor of Kosova, sued the private Belgrade daily "Glas javnosti" on 20 June for $6,000 in damages. The newspaper had printed comments by moderate Kosova Serbian leader Rada Trajkovic, who noted that "those [Serbian] officials who betrayed and abandoned the province have fled to posh hotels and mountain resorts," AP reported. Slavoljub Kacarevic, who is editor-in-chief of "Glas javnosti," told a Belgrade court that Andjelkovic's name did not appear in the article. Elsewhere, a military court stripped former General Momcilo Perisic of his title of general of the reserves. The former head of the general staff frequently criticizes Milosevic and heads a small opposition party. PM

EU: ALL BALKAN STATES ARE POTENTIAL CANDIDATES

Leaders of the 15 EU member-states said in a statement in Santa Maria da Feira, Portugal, on 20 June that all former Yugoslav republics are potential candidates for EU membership. "This is the first time in official [statements] that we talk [about them] as potential candidates," EU Commission President Romano Prodi told journalists, according to Reuters. The leaders also expressed support for the Serbian opposition but warned Kosovar Albanian leaders that "extremist violence will not be tolerated." French President Jacques Chirac, whose country will take over the rotating EU chair on 1 July, said that he will go ahead with plans for an EU-Balkan summit later this year (see "RFE/RL Newsline," 20 June 2000). He added that it will probably take place in Zagreb. It is not yet clear who will be invited, but the list will include members of the Serbian opposition as well as the Montenegrin authorities. PM

CROATIA READY FOR EU'S SECOND ROUND OF EXPANSION?

Lord Russell Johnston, who heads the Council of Europe's parliamentary assembly, told the Croatian parliament on 20 June that Croatia has experienced a "very big change" in its relations with Brussels and Strasbourg since the country's elections in January and February. He noted that the new Croatian leaders are "much more open" and reform-oriented than were their predecessors, AP reported. Croatia is quickly catching up with Latvia, Lithuania, Romania, Bulgaria, Slovakia, and Malta, which are the countries considered potential candidates for a "second wave" of EU expansion, he argued. He also commented that war crimes were committed by neither Serbs nor Croats but rather by bad people, "Jutarnji list" reported. PM

MACEDONIAN DRUG HAUL

Macedonian police confiscated some 260 kilograms of hashish from a truck crossing the border from Albania near Struga on 20 June, AP reported. A police spokesman said that the drugs have a street value of about $1 million and that the Albanian truck driver is under arrest on charges of drug trafficking. Impoverished Albania has in recent years become one of the Balkans' main producers of cannabis. PM

MOSTAR BUS LINKS BOTH HALVES OF TOWN

For the first time since the Muslim-Croat conflict began in Bosnia in 1993, a bus route was opened on 20 June to link Croatian western Mostar with Muslim eastern Mostar, RFE/RL's South Slavic Service reported. Even though that conflict ended in 1994 and the Croats and Muslims became nominal allies, the border between east and west Mostar has remained tense. PM

PADDED ACCOUNTS IN REPUBLIKA SRPSKA?

"Vesti" reported on 21 June that it has obtained access to a confidential internal report suggesting that large sums of money have been misappropriated in the government of Prime Minister Milorad Dodik. The report noted that the government spends $800 per day on flowers and that its daily allowance for public affairs expenses is $2,300. The daily added that if the figures were correct, it would mean that the government bought at least 47 large bouquets of flowers per day at local prices. PM

ROMANIAN OPPOSITION'S VICTORY IN LOCAL ELECTIONS RUNOFF CONFIRMED...

According to the official results of the local election runoff on 18 June, the opposition Party of Social Democracy in Romania came first, with 714 mayoralties out of the 2,249 being contested, Mediafax reported. The Democratic Party came second with 386 mayoralties, followed by the Alliance for Romania (253), the National Liberal Party (212), independent candidates (126), the Democratic Convention of Romania (125), the Greater Romania Party (61), and the Social Democratic Party (54). The Romanian National Party won 52 mayoralties, the Socialist Labor Party 47, the Party of Romanian National Unity 42, and the Hungarian Democratic Federation of Romania 38. Turnout was 46.9 percent. MS

...BUT PEASANT PARTY LEADER REFUSES TO STEP DOWN

National Peasant Party Christian Democratic Chairman (PNTCD) Ion Diaconescu, who is also head of the Democratic Convention of Romania, said in an interview with the BBC on 20 June that he does not intend to step down as a result of his formation's poor showing in the local elections. The octogenarian Diaconescu was responding to a Mediafax report saying that five "younger leaders" of the PNTCD intend to meet with Diaconescu on 21 June to demand that he "assume responsibility" for the electoral debacle. Diaconescu said only the PNTCD congress is entitled to replace the party's leader and that congress has been postponed until 2001, following this year's general elections. In other news, the Conel electricity state company workers on 20 June "suspended" their strike after talks with Prime Minister Mugur Isarescu. MS

EUROPEAN COURT TO EXAMINE MOLDOVAN COMPLAINTS

The European Court of Human Rights in Strasbourg will soon examine the complaint against the Moldovan and Russian governments about the continued detention in Tiraspol of members of the "Ilascu group." The complaint was filed by the wives of the detainees, among whom is Ilie Ilascu. Lucius Wildhaber, chairman of the court, said on 20 June in Chisinau that the court will examine the "Ilascu case," regardless of whether Tiraspol accepts or rejects a recent Romanian proposal (also backed by Chisinau) to have the case reviewed in an OSCE country. Wildhaber said the court will also examine the complaint filed by the Bessarabian Metropolitan Church against the government's refusal to recognize it. He recommended that the case be settled "amiably" out of court, Romanian Radio reported on 21 June. MS

NATO COMMANDER PAYS 'SURPRISE VISIT' TO BULGARIA

Newly appointed NATO Supreme Allied Commander Europe General Joseph Ralston arrived in Sofia on 20 June for what Reuters reported is a "surprise visit." He told journalists that it was "important to make an early trip to Bulgaria." The agency said Ralston is due to meet with President Petar Stoyanov and Prime Minister Ivan Kostov on 21 June to discuss developments in Kosova. MS




THE NEW CENTRALIZER


by Julie A. Corwin

Although it became a cliche during Russia's presidential election campaign to refer to then acting President Vladimir Putin as an enigma or "black box," by then it was already clear what kind of president he would become. Just seven weeks after his inauguration, Putin's preference for centralization has been demonstrated in three areas: the media, the vodka industry, and policy toward the regions. And because such centralization promises order, if not law, it is popular with Russian citizens who are looking for a way out of the country's prolonged crisis.

Putin's tactics in each of these areas have been oddly similar: unleashing federal bureaucrats, via a reorganized or somehow empowered federal organ, and letting loose law enforcement officials and making a few high-level arrests--or at the very least, threatening to. All the while, the president seeks to justify his moves to increase central control by using the rhetoric of law and order.

Putin's policy toward the media has gotten a lot of attention, perhaps because those doing the reporting are directly affected by it. The Media Ministry recently announced that it will begin to enforce a 1998 law requiring media organizations to be registered as well as licensed. "If one strictly follows the letter of the law, we could have shut you all down a long time ago," Media Minister Mikhail Lesin commented. Some six months earlier, one of Lesin's deputies announced that then acting President Putin had signed a bill amending the law on economic support for regional newspapers so that money for those newspapers comes directly from the federal budget rather than being channeled through local government organs. Presumably, one dependent relationship has been substituted for another, but with a key difference: now Moscow calls the shots.

Meanwhile, Putin's moves deploying law enforcement officials against the media have gotten even more attention. The arrest of RFE/RL correspondent Andrei Babitskii in Daghestan in February was followed by the raid last month on Media-MOST headquarters, and most recently, the 13 June detention of Media-MOST head Vladimir Gusinskii. If Gusinskii's case follows the same trajectory as Babitskii's, then the legal charges will hover over him for an indefinite period, during which he will be forbidden to travel abroad. The message to journalists without an impressive list of international contacts like Gusinskii's, or a high-level employer such as Babitskii, is criticize the Kremlin at your peril.

With regard to the regions, Putin moved even more quickly and decisively, unfurling at least three new bureaucratic layers to oversee Moscow's interests. First, he restructured the system of having a presidential representative in each federation subject by creating seven administrative macro-regions or districts. Each district has a presidential representative that some analysts have dubbed "governors-general": five of the seven are former officers with the intelligence service or army. Supplementing their efforts will be a newly created corps of seven regional prosecutors and seven branches of the investigative Audit Chamber.

In another saber-rattling exercise, just days after his inauguration Putin ordered federal prosecutors to investigate more than 200 cases of tax dodging, embezzlement, and other economic offenses in Smolensk Oblast. He then submitted legislation to the State Duma asking legislators to empower the Russian president to dismiss elected governors who violate federal laws on more than one occasion. While trying to persuade deputies of the bills' merits, Putin's presidential representative Aleksandr Kotenkov said that "at least 16 governors" face the prospect of criminal prosecution.

Putin's policy toward the vodka industry has attracted less attention but could have as great an impact on the country's development, given the importance of that industry as a revenue-earner and as staple in the citizenry's diet. As with the regions, Putin took a bureaucratic institutional idea leftover from the Yeltsin presidency and reinvigorated it. Late last month, he issued a resolution stating that all state-owned companies producing alcohol will be restructured into branches of Rosspirtprom, a holding company that will also manage all of the state's stakes in alcohol-producing companies. Centralizing the production of vodka had been provided for in a Yeltsin decree that was never implemented.

Police have since targeted key facilities in the vodka sector. The offices of Soyuzplodimport, the company holding the rights to the names of about 50 of Russia's most famous brands of vodka, were raided several times by Interior Ministry police around early June. And Yurii Ermilov, the director of the Kristall factory, the country's leading alcohol producer, was sacked and a Rosneft vice president named in his place. Although the federal government owns 51 percent of the company's stock, Moscow city authorities were reportedly virtually running the factory. A number of analysts suggested that the removal of Ermilov represents an attempt by federal authorities to reassert control over a lucrative enterprise.

The vodka industry needed regulating, since the country has been overrun with bootleg manufacturers. And it is also true that some regional leaders have ridden roughshod over their population's best interests, suppressing any political opposition and pursuing an economic policy favoring local businessmen. Likewise, competing oligarchs have used the Russian media as vehicles to distribute "kompromat" against their enemies.

All these "truths" are self-evident to the Russian population, which gave Putin a 53 percent mandate. What's less evident, though, is how increasing central control will necessarily address these problems. Judging by the Soviet experience, hooch, a corrupt press, and feudalistic local leaders can all exist simultaneously with increased oversight from Moscow. In fact, they can even flourish.


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