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Newsline - July 28, 2000




TOP BUSINESS LEADERS TO SEEK GUARANTEES ON PRIVATIZATION...

Twenty-one top business leaders were poised to gather at the Kremlin on 28 July for a meeting with Russian President Vladimir Putin (see "End Note" below). Unidentified Kremlin sources told Interfax that the presidential administration is not ruling out that such meetings might become a regular event. Oleg Kiselev, head of Impexbank, who has been invited to attend, said that entrepreneurs expect the authorities to give "assurances that the results of privatization will not be revised and to take practical steps to change legislation, the imperfection of which permits law enforcement bodies to persecute virtually any successfully operating corporation." In an interview with "Kommersant-Daily" the previous day, Unified Energy Systems chief Anatolii Chubais suggested that "medium-sized businesses have been sending alarm signals that are changing into signals of panic." Chubais was invited to the meeting but is unable to attend. JAC

...AS BEREZOVSKII NEWSPAPER WARNS NEW FINANCIAL FSB TO BE CREATED

"Kommersant-Daily" reported on 28 July, without reference to sourcing, that the presidential administration is considering setting up a financial intelligence agency that would monitor all financial flows. In addition, the Kremlin is reportedly working on a decree to give the Federal Tax Police extra powers. The daily, in which Boris Berezovskii owns a controlling share, added that "the Federal Tax Police will soon become no less powerful than the proposed new financial intelligence agency." President Putin recently dismissed rumors that a mega intelligence agency would be created (see "RFE/RL Newsline," 25 July 2000). In his interview with "Kommersant-Daily," Chubais claimed that three groups are vying to influence Putin: the so-called "Family" and their proteges, the "liberals" from St. Petersburg, and the Federal Security Service (FSB) from St. Petersburg. JAC

SIBNEFT TO FEEL EXTRA HEAT ON TAXES?

ITAR-TASS reported on 27 July that the Russian government intends to prevent some oil companies from "evading" taxes. According to the agency, First Deputy Finance Minister Sergei Ignatiev has submitted a study of tax payments by Russia's oil companies from 1999 through the first quarter of 2000. The report concluded that Sibneft has paid half as much in tax as LUKoil and Surgutneftegaz and almost four times less than Rosneft and ONAKO. On the other hand, "Segodnya" reported the previous day that the investigation revealed Sibneft had paid eight times less than Sidanko or Surgutneftegaz (see "RFE/RL Newsline," 27 July 2000). Sibneft will be represented at the 28 July meeting with Putin by Sibneft President Yevgenii Shvidler rather than State Duma deputy (independent) Roman Abramovich, who is closely associated with Sibneft. JAC

SPECULATION, ALLEGATIONS FOLLOW IN GUSINSKII'S WAKE

Newspapers owned by Boris Berezovskii have asserted that Media-MOST head Vladimir Gusinskii, in order to secure the lifting of criminal charges brought against him, agreed that his media holdings would be more gentle in their coverage of President Putin and his polices. Berezovskii and Gusinskii are long-time rivals. "Kommersant-Daily" alleged on 27 July that Gusinskii rejected an attempt by Gazprom-Media to increase its stake in NTV and agreed to soften NTV's stance toward the Kremlin, while "Nezavisimaya gazeta" made similar allegations the next day. In remarks cited by "The Moscow Times" on 28 July, Yevgenii Volk of the Heritage Foundation noted that "it has emerged as a trademark method of Putin and the special services: to attack, test the reaction in society and in the West and then either push further or back out. They appear to have found a compromise: They let Gusinsky go and his media will become more loyal." AFP reported that NTV devoted less than 40 seconds to news that the charges against Gusinskii had been lifted. JAC

FORMER DIPLOMAT FOUND GUILTY OF SPYING FOR BRITAIN

Platon Obukhov, a former diplomat and the son of an ex-deputy foreign minister and top arms-control negotiator, has been sentenced to 11 years in prison for spying for Britain in the mid-1990s. Obukhov was arrested in 1996 and ordered to undergo psychiatric treatment for "reactive psychosis," a disorder he allegedly developed after his arrest. In April 2000, he was deemed fit to stand trial. The defendant's family says that Obukhov has been treated for mental problems since he was four years old, while his mother was quoted by Russian Public Television as saying that Obukhov, who has written paperback thrillers, is not on speaking terms with her because he suspects her of stealing the Nobel Prize from him. Obukhov's lawyers, meanwhile, intend to appeal the verdict to the Russian Supreme Court, arguing the evidence against the defendant was obtained illegally. JC

TOP BRASS SUBMIT MILITARY REFORM PROPOSALS

According to Colonel General Valerii Manilov, the first deputy chief of the General Staff, Russia's military leaders have submitted proposals to the Security Council on reforming the armed forces, Interfax reported on 27 July. President Putin had requested such proposals from his top military men earlier this month, after long-standing differences between chief of the General Staff Anatolii Kvashnin and Defense Minister Igor Sergeev developed into a public row over the future of the Strategic Rocket Forces (see "End Note" in "RFE/RL Newsline," 20 July 2000). Manilov told journalists that military leaders have suggested reforms in line with changes in the geopolitical environment, state finances, and "real threats." A Security Council meeting devoted to discussing military reform was scheduled for this week but has been postponed until the first 10 days of next month, according to "Segodnya" on 27 July. JC

ZYUGANOV DENOUNCES UN SANCTIONS AGAINST IRAQ...

After meeting with Iraqi Deputy Prime Minister Tariq Aziz in Moscow on 27 July, Communist Party leader Gennadii Zyuganov told journalists that the UN sanctions on Iraq following that country's invasion of Kuwait are "shameful" and "one of the most repulsive inventions of the 20th century." The previous day, Aziz had held talks with President Putin, Prime Minister Kasyanov, and Security Council Secretary Sergei Ivanov. "Kommersant-Daily," which is owned by Boris Berezovskii, commented in its 27 July issue that the fact Putin met personally with Aziz shows that Russia is seeking "to bring former satellites back into the fold." The daily added that "Moscow may try to take its own niche on the international scene, acting as intermediary between rogue regimes and the West." JC

...WHILE MOSCOW PROFESSES 'SURPRISE' OVER U.S. STATEMENT

Interfax on 27 July quoted unidentified diplomatic sources in Moscow as expressing surprise at a U.S. State Department statement the previous day saying that Aziz's visit to Moscow is inappropriate (see "RFE/RL Newsline," 27 July 2000). Russia, those sources said, has the duty, as a permanent member of the UN Security Council, "to make every effort to promote the settlement of the situation of Iraq, ...[which includes developing] bilateral contacts with Baghdad." And they added that "another surprising circumstance is that the U.S. made this statement now and not when Tariq Aziz visited Moscow in November 1999." Aziz is scheduled to meet with Russian Foreign Minister Igor Ivanov in Moscow on 28 July. JC

POLICE OFFICIAL SHOT IN DAGHESTAN

Unidentified gunmen opened fire on the car of Gadzhimagomed Gadzhimagomedov, director of the police training school in Makhachkala, on the morning of 27 July, Interfax reported. He died later of his wounds. His driver killed two of the attackers, but the third escaped. LF

YASTRZHEMBSKII DRAWS DISTINCTION BETWEEN CHECHEN PRESIDENT, FIELD COMMANDERS

Russian presidential aide Sergei Yastrzhembskii repeated on 27 July Moscow's longstanding position that talks with Chechen President Aslan Maskhadov can be conducted only on the basis of the conditions on which he is prepared to surrender, Interfax reported. But Yastrzhembskii conceded that while Moscow's attitude to Maskhadov is negative, "we cannot treat him the same way as [field commanders Shamil] Basaev and Khattab...[who] must and will be liquidated." Also on 27 July, Yastrzhembskii denied reports that some 200 Chechen fighters had entered Grozny. LF

RUSSIAN MILITARY FORESEES TERRORIST ATTACKS, BUT NO LARGE- SCALE CHECHEN ASSSAULT

Speaking at a press conference in Moscow on 27 July, Colonel General Manilov predicted that the Chechen fighters will stage acts of sabotage in Grozny on 6 August to mark the fourth anniversary of their recapture of the capital and the first anniversary of Basaev's ill-fated incursion into Daghestan, Interfax reported. The same day, the deputy commander of the joint federal forces in Chechnya, Lieutenant General Valerii Baranov, discounted the possibility of new large-scale Chechen military activity, saying that the remaining 2,000 Chechen fighters are incapable of mounting any action that would radically change the existing military situation. "There will be no [repeat of] August 1996," Baranov said, adding that the Chechens "have nothing to hope for." LF

GREF'S MINISTRY UPS FORECAST FOR ECONOMY THIS YEAR...

Minister for Economic Trade and Development German Gref told reporters on 27 July that Russian industrial production will rise by 7.5 percent this year rather than 6 percent, as originally forecast. He also suggested that real disposable incomes will rise by 6.5 percent rather than 6 percent. In addition, the ministry increased its inflation forecast from 18 percent to 20 percent. JAC

...EXPECTS SMALL UPTICK IN FOREIGN INVESTMENT

According to ITAR-TASS, the ministry is also predicting an increase in foreign investments over the previous year's level to $4.5-5 billion dollars. Foreign investment in the first half of 2000 totaled some $2 billion, with investors concentrating the bulk of their funds in seven Russian regions--Moscow City and Moscow Oblast, Sakhalin and Tyumen Oblasts, St. Petersburg, Krasnodar Krai, and the Republic of Tatarstan. Last year, direct foreign investment totaled $4.260 billion, according to the State Statistics Committee (see "RFE/RL Newsline," 29 February 2000). JAC

HALF OF REVENUE FROM FISH SALES SLIP THROUGH THE NET

Sakhalin Governor Igor Farkhutdinov told reporters on 27 July that about one half of fish caught in the Far East--about 1.3-1.5 million tons--were exported illegally during the first half of 2000 and as a result some $3 billion in sales revenues went untaxed. The governor recommended strengthening the recent bill on fishing, passed in its third reading by the State Duma, in a conciliatory commission composed of members of each house (see "RFE/RL Newsline," 20 July 2000). JAC

PUTIN ASKS LEGISLATORS TO BRAINSTORM OVER NEW GOVERNORS' GROUP

President Putin signed an order on 27 July calling for members of Russia's upper and lower houses to submit "proposals regarding the status of composition" of the new State Council. The council was first suggested by several governors as a body composed of regional heads that would advise the president but not approve legislation, as the Federation Council does. Earlier in the month, anonymous sources in the presidential administration claimed that Kremlin was preparing a draft decree on the new State Council and that it would be composed of some of the members of the current Federation Council, such as Tatarstan President Mintimer Shaimiev and Sverdlovsk Oblast Governor Eduard Rossel (see "RFE/RL Russian Federation Report," 12 July 2000). JAC

JOURNALISTS' UNION CALLS SLAYING POLITICAL...

The Russian Union of Journalists issued a statement on 27 July condemning the killing of Sergei Novikov, head of the independent radio station, Vesna, in Smolensk as a "political crime" (see "RFE/RL Newsline," 27 July 2000). Noting that Novikov was gunned down a day after his station had aired a program harshly criticizing the administration of Smolensk Governor Aleksandr Prokhorov, the union also called the murder "an attack on freedom of speech, on the right of society to know the truth about itself." According to "The Moscow Times" on 28 July, Novikov had been planning to challenge Prokhorov in upcoming elections. Prokhorov's press secretary told ITAR- TASS that "Novikov was known primarily in the oblast as a businessman and the reason for his murder is likely to be found there." JAC

...WHILE FAR EAST GOVERNOR TURNS THE SCREWS ON ANOTHER JOURNALIST

Irina Grebneva, the chief editor of the Primore opposition newspaper "Arsenevskie Vesti," who was arrested on 27 July, has declared a hunger strike. The newspaper has frequently locked horns with Krai Governor Yevgenii Nazdratenko, who has seized entire print runs on several occasions (see "RFE/RL Newsline," 22 November 1999). Grebneva has been charged with petty hooliganism for publishing what she alleges are transcripts of a telephone conversation between Nazdratenko, one of his deputies, and Vladivostok Mayor Yurii Kopylov, Interfax-Eurasia reported. The three discussed the falsification of the18 June mayoral elections in that city. The conversation contained foul expressions, and the petty hooliganism charge stems from her failure to censor their language. A lawyer for the publication noted that the krai lacks "any independent courts." JAC

MURDERERS-FOR-HIRE SEE BUSINESS FALL OFF

The number of contract murders declined 14 percent during the first half of 2000, compared with the same period last year, Russian agencies reported on 27 July, citing Interior Ministry figures. The proportion of murders solved also rose--49 out of 249 in the first six months of 2000 compared with 11 out of 289 during the same period last year. JAC




SENIOR NATO OFFICIAL VISITS ARMENIA

On a working visit to Yerevan on 26-27 July, NATO Deputy Secretary-General for Political Issues Klaus Peter Kleiber discussed with Armenian Foreign Minister Vartan Oskanian the ongoing efforts to resolve the Karabakh conflict and the relevance to that process of conflict resolution in the Balkans, Armenpress and Noyan Tapan reported. The two men also discussed Armenia's relations with Russia and Turkey, NATO-Russian relations, the proposed South Caucasus Security Pact, and preparations for NATO Secretary-General Lord Robertson's planned visit to Armenia in September. LF

PROMINENT ARMENIAN WAR VETERAN UNDER INVESTIGATION

Armenian police have opened a criminal investigation against Ruben Gevorgian, a parliamentary deputy and prominent member of the Yerkrapah Union of Veterans of the Karabakh war, RFE/RL's Yerevan bureau reported on 27 July. Gevorgian is suspected of having coerced two men to admit to an armed robbery which police believe was committed by Gevorgian's nephew. In a program broadcast last week by Armenian state television, the two men said Gevorgian had promised them a large sum of money for admitting to the crime and serving a short jail sentence. Gevorgian has denied those accusations, which he termed persecution by the Armenian government because of his political views. Gevorgian had hinted at the complicity of President Robert Kocharian in the 27 October Armenian parliamentary shootings. LF

ARMENIANS IN SOUTH RUSSIA APPEAL TO PUTIN FOR PROTECTION

The Armenian community of the Apsheron and Tuapse Raions of Russia's Krasnodar Kari have addressed an appeal to Russian President Vladimir Putin expressing "profound concern" at efforts by local media to incite tensions between Russians and non-Russians, Noyan Tapan reported on 25 July. The Armenians affirm support for Russia's war in Chechnya and call on Putin "as the president of a great power" to promote "a balanced ethnic policy" and to strengthen friendly relations between all peoples of the Russian Federation. LF

FORMER KARABAKH DEFENSE MINISTER ENDS HUNGER STRIKE

Samvel Babayan has abandoned the hunger strike he began on 17 July to demand that his trial be held not in the unrecognized Nagorno-Karabakh Republic but in Armenia. However, he has not retracted that demand, Armenpress reported on 27 July (see "RFE/RL Newsline," 20 July 2000). Babayan faces charges, which he denies, of masterminding the 22 March assassination attempt on Karabakh President Arkadii Ghukasian. Meanwhile the office of the Nagorno-Karabakh Prosecutor-General has agreed to Babayan's request that three lawyers from Armenia be allowed to defend him, Groong quoted Snark as reporting on 25 July. Meanwhile Babayan's sister Anush has appealed for political asylum in a number of Western countries, saying that she is subject to political persecution and has been threatened with eviction from her Stepanakert apartment, Snark reported. LF

AZERBAIJAN, GEORGIA DISCUSS GAS EXPORT PLANS

Georgian International Gas Corporation President Aleksei Gotsiridze told journalists in Tbilisi on 27 July that Azerbaijan plans to begin construction before the end of this year of a pipeline across Georgia to export to Turkey gas from Azerbaijan's Shah Deniz deposit, Interfax reported. That 250 kilometer pipeline will link up with an existing pipeline in Azerbaijan, and have an initial throughput capacity of 5 billion cubic meters per year, rising to 16-24 billion cubic meters. Gotsiridze said that a group of companies operating in Azerbaijan, including BP/Amoco, has agreed to provide $500-700 million toward the estimated total $1.5 billion construction costs. Caucasus Press reported on 24 July that Valekh Alesqerov, who heads the Foreign Investments Division at Azerbaijan's state oil company SOCAR, would travel to Turkey on 26 July to discuss Turkish purchases of Azerbaijani gas. The decision to begin work on the Azerbaijan-Georgia pipeline casts further doubts on the prospects for construction of a Trans-Caspian pipeline to export Turkmen gas to Turkey. LF

GEORGIAN GOVERNMENT APPROVES 2001 DRAFT BUDGET

Georgian Finance Minister Zurab Nogaideli told journalists in Tbilisi on 26 July that the draft budget for 2001 approved by the government the previous day envisages revenues of 1.049 billion lari ($503 million) and expenditures of 1.45 billion, Caucasus Press reported. The resulting 440 million lari deficit is equal to 6.5 percent of projected GDP. Speaking at the 25 July government session that approved the draft, President Eduard Shevardnadze said that it demonstrates that the economic crisis is over. Three weeks ago, a budget sequester had been introduced (see "RFE/RL Newsline," 10 July 2000). LF

KAZAKHSTAN'S PRESIDENT MEETS WITH POLITICAL PARTIES

Nursultan Nazarbaev held talks at his Almaty residence on 27 July with representatives of several political parties and movements, RFE/RL's bureau in the former capital reported. LF

JAPAN TO DEVELOP INFRASTRUCTURE OF NEW KAZAKH CAPITAL

Kazakh and Japanese government representatives signed a protocol in Astana on 26 July whereby Japan's International Cooperation Agency will draft plans for the water -supply and sewage systems in the new capital, Interfax reported. The corporation will also design a road system that will take into account the anticipated increase in the city's population from the present 320,000 to 490,000 in 2010 and to 690,000 in 2020. LF

KYRGYZ, RUSSIAN PRESIDENTS SIGN ETERNAL FRIENDSHIP DECLARATION

Askar Akaev and Vladimir Putin signed a declaration on Eternal Friendship between their two countries and a 10-year economic cooperation program in Moscow on 27 July. Speaking later at a joint press conference, Akaev stressed that Kyrgyzstan has always regarded its "strategic partnership" with Russia as a foreign-policy priority. He expressed gratitude for Russia's military assistance last year in expelling Islamic militants from Kyrgyzstan. Putin, for his part, again expressed appreciation for the Kyrgyz parliament's decision to raise Russian to the status of an official language (see "RFE/RL Newsline," 26 and 29 May 2000). He also noted Kyrgyzstan's unfailing support for integration processes within the CIS. Putin stressed that military, military-technical and humanitarian cooperation will figure prominently in future bilateral relations, according to Asia Plus--Blitz. Akaev also met the same day with Russian Prime Minister Mikhail Kasyanov, who affirmed Russia's readiness to "stabilize the economic situation, fight poverty and create conditions for economic growth" in Kyrgyzstan, ITAR-TASS reported. Russia is Kyrgyzstan's main trade partner. LF

UN WARNS TAJIKISTAN'S POPULATION THREATENED BY DROUGHT

The UN-funded World Food Program and Food and Agriculture Organization warned on 27 July that half of Tajikistan's 6 million population faces hunger and under-nourishment and possibly even death from starvation as a result of the ongoing drought, Reuters and AP reported (see "RFE/RL Newsline," 6 June 2000). They note that cereal production has plummeted because of a shortage of quality seed and the breakdown of agricultural and irrigation equipment. The two agencies appealed to the international community for assistance. LF




BELARUSIAN PRESIDENT SAYS HARVEST IS POLITICAL ISSUE

Alyaksandr Lukashenka on 27 July held his annual conference with government officials and agricultural managers to discuss the harvest campaign. Lukashenka said during the meeting, which was televised and lasted four hours, that the country expects the best harvest in the past three years, and he demanded that the collective farms fulfill all state grain purchase orders, warning that he will not take into account bad weather if the crop yield turns out to be poor. Lukashenka added that this year's harvest is a political issue. "We should avoid dependence [on foreign grain supplies] while our oppositionists are going to the Czech Republic and saying there: 'Don't give bread to the Belarusians, let them kick the bucket, so they will overthrow their Lukashenka sooner,'" Belarusian Television quoted him as saying. JM

U.S. URGES BELARUS TO REALIZE 'DREAM' OF INDEPENDENCE

The U.S. on 27 July marked the 10th anniversary of Belarus's declaration of sovereignty from the Soviet Union by urging the government to "realize the dream" of a democratic and independent country, Reuters reported. "Ten years later...much remains to be done to realize the dream of a democratic and independent Belarus in which the rights of all citizens are respected and which is part of the international and Euroatlantic community," the White House said in a statement. The U.S. also called on the Belarusian authorities to take all necessary steps to hold free and fair elections in line with OSCE requirements, beginning with parliamentary elections this fall. RFE/RL's Belarusian Service reported the same day that Belarusian democratic forces marked the anniversary of the sovereignty declaration by staging pickets and rallies in a number of Belarusian cities. JM

UKRAINIAN PRESIDENT SLAMS CABINET OVER ENERGY POLICY...

Leonid Kuchma on 27 July criticized Viktor Yushchenko's cabinet for mismanaging the energy and fuel sector in Ukraine. ""I am not happy with the government's performance, although this does not mean with the prime minister. But changes are necessary, and if Yushchenko does not understand this, it is his problem, not mine," Interfax quoted Kuchma as saying. Earlier the same day, Kuchma criticized Deputy Premier Yuliya Tymoshenko, who is in charge of the energy and fuel sector, for signing a deal on gas deliveries from Turkmenistan (see "RFE/RL Newsline," 27 July 2000). Yushchenko explained that Tymoshenko only "initialed" a document on conditions of Turkmen gas supplies, adding that the document has not yet acquired legal force. JM

...WHILE TYMOSHENKO SAYS SHE WILL NOT RESIGN

Tymoshenko told journalists the same day that she "fully agrees" with Kuchma's opinion that the price of Turkmen gas could be lower than that on which she agreed during her visit to Ashgabat, Interfax reported. She noted, however, that the gas transportation costs will not be as high as suggested by the president, adding that Ukrainian consumers will be able to buy 1,000 cubic meters of Turkmen gas for some $50. Tymoshenko declined the suggestion that she would resign in connection with Kuchma's criticism of the situation in the energy and fuel sector. "It is no wonder to me that there are a lot of circles dissatisfied with [my] curbs on the shadow economy in the energy sector.... But as long as I am in my post, I will be introducing such a [high degree of] order that Ukraine will not be ashamed," she said. JM

ESTONIAN OPPOSITION CONTINUES ANTI-U.S. RHETORIC

In response to a letter from U.S. Secretary of State Madeleine Albright thanking the Estonian government for supporting the deal whereby NRG Energy is to take a minority stake in the country's power plants, opposition deputy Villu Reiljan asked whether Estonia "wants to enter the United States of America or the European Union," BNS reported. Reiljan suggested Estonia would lose tens of millions of dollars in "environmental money that will never flow into Estonia because the EU will not aid American capital, after all." MH

HIGH INCIDENCE OF ALCOHOL, DRUG USE AMONG LATVIAN TEENAGERS

A study published by the Central Statistics Bureau indicate that 90 percent of 15 and 16 year olds in Latvia consumed alcohol or took drugs during 1999, BNS reported on 27 July. The report shows that 89 percent of boys and 88 percent of girls consumed alcohol, while 59 percent of boys and 50 percent of girls were drunk some time during the year. Some 71 percent of boys and 83 percent of girls have tried tobacco, while 12 percent of boys and 22 percent of girls have taken marijuana. Some 28 percent of boys and 12 percent of girls consumed alcohol at least once a week during the year. The report indicated that consumption has risen since a similar report dating from 1995; in particular, marijuana use among teenagers has tripled. MH

LITHUANIAN PRESIDENT VETOS MORE LAWS

Valdas Adamkus continues to veto bills passed by the Conservative-led parliament before it ended its summer session. On 27 July, Adamkus vetoed three controversial laws on the media and civil service wages. The media law placed stronger state control on the media, while the two wage-related bills regulated the salaries of various officials, among other things decreasing the earnings of the president, judges, and police officers, ELTA reported. Adamkus has vetoed 18 bills passed during the last week of the parliament's recent session. However, he did sign a bill amending the value-added tax system. MH

DOCUMENTS SUGGEST POLISH PRESIDENT MAY HAVE BEEN SECRET SERVICE AGENT

Aleksander Kwasniewski, who is seeking re- election in this fall's presidential ballot, appeared before the Lustration Court on 27 July to testify that he did not collaborate with communist-era secret services. However, the State Protection Office supplied the court with documents suggesting that Kwasniewski may have been a secret service agent when he was pursuing a career in journalism in communist Poland. The court will question four former security service officers who allegedly maintained contacts with Kwasniewski. "I hope that this matter is not a planned component of a political game by those who cannot win against me in an honest fight," Kwasniewski commented. Kwasniewski's lawyer, Ryszard Kalisz, said the documents supplied to the court have nothing to do with Kwasniewski and suggested that the election team of Solidarity leader Marian Krzaklewski might be responsible for staging a "political provocation" against the incumbent. JM

MINISTER SAYS POLAND'S ECONOMY BLOOMING

Economics Ministry Janusz Steinhoff told journalists on 27 July that Poland's GDP grew by 6 percent in the first half of 2000, compared with the same period last year. Steinhoff added that the economy is back on a steady growth track after a slowdown early last year. He said that the economy has remained stable, despite the breakup of the governing coalition last month, which left Prime Minister Jerzy Buzek's cabinet without a majority in the parliament. Steinhoff predicted that this year's exports will grow by 4 percent to $27.4 billion. But he noted that imports are expected to grow by 6 percent to $44.2 billion, thereby increasing the foreign trade deficit. JM

INTERNATIONAL ROMANY MEETING PLEDGES TO SEEK NATION-STATUS

The Fifth Congress of the International Romany Union (IRU), meeting in Prague at RFE/RL headquarters, approved a resolution on 27 July saying Roma around the world must be recognized as a separate nation and pledging to work to that end in international forums, CTK, TASR, and AFP reported. Participants said Roma must learn "from the Jewish experience" how to defend their brethren. The IRU also said it will make new demands for compensation for survivors of the Holocaust. IRU Vice Chairman Gejza Adam said a World Romany Parliament might be established and be headquartered in Bratislava. The IRU elected Emil Scuka as its new chairman. Scuka, a lawyer who lives in the Czech Republic, had been acting IRU chairman since April 1999. MS

CZECH TV SUSPENDS ROMANY ANNOUNCER SUSPECTED OF FRAUD

Television announcer Ondrej Gina will go on vacation until an investigation has been conducted into allegations that he cheated the tax authorities, Czech Television Public Relations Director Jaroslava Sedackova told CTK on 25 July. Gina, a Roma, is suspected by the tax authorities in Rokycany of having illegally claimed social benefits together with his wife, who failed to report her husband's real income. Gina's father, whose name is also Ondrej Gina, was accused last week of the same offense. Ondrej Gina Sr. is a Roma activist in Rokycany. MS

SLOVAK PRESIDENT TO REASSUME PREROGATIVES

Rudolf Schuster, who remains hospitalized in Innsbruck, Austria, will reassume his presidential duties next week, TASR reported, quoting parliamentary chairman Jozef Migas, who visited President Schuster in Innsbruck on 27 July. Schuster is also expected to address the Slovak media within the next seven days. Presidential spokesman Jozef Leikert said on 27 July that Schuster is likely to work from a sanatorium in the vicinity of the Innsbruck clinic and continue to be treated by the same team of doctors. Those doctors consider Schuster is "still too weak" following his long hospitalization, CTK reported. On 27 July, the ailing president underwent minor surgery for a wound in his stomach that has been healing very slowly, after the colonostomy that he had earlier undergone. MS

FORMER SLOVAK PRESIDENT BLAMES GOVERNMENT FOR LEXA'S FLIGHT

Michal Kovac, whose son was abducted in 1995 in what investigators say was a conspiracy in which former Slovak Intelligence chief Ivan Lexa was involved, has blamed the government for making it possible for Lexa to flee the country, AP reported. Kovac told TASR that Mikulas Dzurinda's cabinet "lacks unity" and is "unable" to deal with the situation. MS




MONTENEGRIN PRIME MINISTER SAYS 'NO' TO MILOSEVIC'S ELECTIONS

Filip Vujanovic said in Niksic on 27 July that the governing coalition stands by its previous decision not to participate in any federal legislative or presidential elections held under Yugoslav President Slobodan Milosevic's new constitutional amendments and electoral legislation (see "RFE/RL Newsline," 27 July 2000). "The governing coalition in Montenegro has no reason to participate in these elections since participation would strengthen Milosevic and help keep him in power," "Pobjeda" reported. Vujanovic added that he "expects" the army to do its constitutional duty and stay out of politics. Elsewhere, President Milo Djukanovic's adviser Miodrag Vukovic stressed that the Montenegrin authorities will not let Milosevic use the elections to provoke domestic unrest in Montenegro, Reuters reported. In Belgrade, Serbian Deputy Prime Minister Vojislav Seselj said that the federal elections will go ahead in Montenegro whether Djukanovic chooses to participate or not. PM

SERBIAN OPPOSITION LEADER STRESSES REFUSAL TO TAKE PART IN VOTE

Serbian Renewal Movement leader Vuk Draskovic told the BBC's Serbian Service from Budva on 27 July that the federal elections are meaningless without Montenegro. He added that elections without the participation of "official Montenegro" will serve to undermine the unity of Yugoslavia, including Kosova as well as Serbia and Montenegro. Vojislav Kostunica of the Democratic Party of Serbia said in Belgrade that he hopes that the Montenegrin leaders and Draskovic will change their minds, Reuters reported. A spokesman for the Otpor (Resistance) student movement argued that "with a boycott, everything will be lost" to Milosevic. Democratic Party leader Zoran Djindjic said that he is "optimistic" that the opposition can "forge an agreement on a joint electoral appearance," AP reported. PM

U.S. 'CHALLENGES' MILOSEVIC

State Department spokesman Philip Reeker said in Washington on 27 July that "with the announcement of a September 24th date, we challenge Milosevic to hold free and fair elections and to allow independent media to operate freely and to permit outside international and domestic observers to monitor the election process.... [In this way] this election process will give the people of Serbia the opportunity to determine their leader through a free and fair contest at the ballot box," an RFE/RL correspondent reported. PM

MILOSEVIC'S MINISTER BLASTS OPPONENTS

Yugoslav Information Minister Goran Matic said in Belgrade on 28 July that Milosevic' opponents are "a frustrated bunch unable to rally the rest of the world behind a policy of pressure. There is no higher expression of democracy than a popular vote, the democratic ideal. What [Milosevic's opponents] don't like is the fact the people of Yugoslavia will choose freely in the elections and that...Slobodan Milosevic has a tremendous advantage [in popularity that] no opposition candidate could ever match." Matic added that "Djukanovic is a classic stooge who goes around and badmouths his own country to Western leaders. Djukanovic and his policies will collapse at the elections, [and] his behavior [sic] will be defeated and punished by the people," AP reported. Matic concluded by arguing that "the will of our people is peace, freedom and prosperity...and Milosevic is the symbol of all these. The West has to come to terms with that." PM

MILOSEVIC PLANNING TO REORGANIZE MILITARY?

Milosevic plans to streamline the military command structure before the end of 2000 by eliminating the air force, anti-aircraft defense, and navy as separate commands, "Vesti" reported on 28 July. The entire Yugoslav military will be grouped together in one general staff under the command of army General Nebojsa Pavkovic, who regards the changes as a rationalization measure, the daily added. Observers note that Milosevic has never fully trusted the military and long built up the paramilitary police as his own Praetorian guard. The navy and air force are relatively small organizations designed for reconnaissance against and harassment of any invader. PM

MONTENEGRO SET TO TAKE CONTROL OF FINANCES

The government has drafted a bill to establish a new Central Bank of Montenegro independent of the Yugoslav National Bank, dpa reported on 27 July. The Podgorica authorities view the National Bank as a destabilizing influence and fear a new round of hyperinflation after the elections. The German mark is already legal tender in Montenegro alongside the Yugoslav dinar. PM

CLINTON, SCHROEDER TAKE STOCK OF THE BALKANS

In a joint article in the "International Herald Tribune" on 28 July, U.S. President Bill Clinton and German Chancellor Gerhard Schroeder summed up the achievements of the international community in the Balkans in the past 12 months. They concluded that "we will continue to work with the democratic opposition in Serbia, to help it unite around a common platform, to support nongovernmental organizations and the independent media, and to back President Milo Djukanovic...until all those who have suffered under Mr. Milosevic's rule can take their place in Europe. We have no illusions about the hard work that remains, but the progress made thus far gives us confidence that it can be completed. Together we can do for Southeast Europe what was done for Western Europe after World War II and Central Europe after the collapse of communism: integrate it into a democratic, undivided Europe in which the prospect of yet another terrible war is unthinkable." The two leaders stressed that the international community must remain firm and united. PM

MACEDONIAN GOVERNMENT REORGANIZED

The parliament on 27 July approved measures to cut the size of the cabinet from 27 to 17 seats in keeping with recommendations from the EU and World Bank, the private MIC news agency reported (see "RFE/RL Newsline," 19 July 2000). Prime Minister Ljubco Georgievski announced the new cabinet line-up, the fourth since he was elected in 1998. Among the changes is that Ljuben Paunovski moves from the culture portfolio to defense, where he replaces Nikola Kljusev. Georgievski stressed that his government's priorities remain the same, namely to press for integration into NATO and the EU. The breakdown of the new cabinet is: Internal Macedonian Revolutionary Organization: prime minister plus seven seats; Democratic Alternative: Deputy Prime Minister Vasil Tupurkovski and four seats; and Democratic Party of the Albanians: Deputy Prime Minister Ernat Fejzulahu and three seats. Opposition Social Democratic deputy Georgi Spasov said that Georgievski missed an opportunity to rid himself of unnamed ineffective ministers and bring in new faces. PM

TURKEY SOURING OVER KOSOVA ROLE

Foreign Minister Ismail Cem said in Ankara on 27 July that his government will take unspecified steps to show its disapproval if the UN's civilian administration does not act to make the Turkish language equal to Serbo-Croatian and Albanian in Kosova, AP reported. The UN has been willing to use Turkish as an official language in areas where the 15,000-strong Turkish minority is strong, but Ankara wants Turkish to be official throughout the province, the news agency added. Turkey provides both an aid program and 1,000 peacekeepers to Kosova. PM

BOSNIA, CROATIA SIGN AGREEMENTS

Croatian Prime Minister Ivica Racan and his Bosnian counterpart, Spasoje Tusevljak, signed agreements on repatriation and on customs arrangements in Sarajevo on 27 July (see "RFE/RL Newsline," 25 July 2000). They also agreed that citizens of the two countries may cross their common border by showing only their internal identity card rather than a passport, RFE/RL's South Slavic Service reported. Racan said that he was "unpleasantly surprised" by criticism from Muslim leader Alija Izetbegovic of Racan's decision to meet separately with representatives of the ethnic Croatian community. Racan stressed that "a stable Croatia can only exist along with a stable, single, and sovereign Bosnia-Herzegovina. Croatia is determined to strengthen its relations with Bosnia," Reuters reported. PM

CROATIAN LEADERS TO U.S.

U.S. Ambassador to Croatia William Montgomery said in Zagreb that Racan and President Stipe Mesic will visit Washington from 8-10 August, "Jutarnji list" reported on 28 July. Among the leaders they will meet with are President Clinton and Secretary of State Madeleine Albright. The exact itinerary of the trip has not yet been completed. PM

ROMANIAN LIBERALS TO BE OUSTED FROM CDR?

National Peasant Party Christian Democratic (PNTCD) Deputy Chairman Ioan Muresan said on 27 July that the National Liberal Party will "expel itself" from the Democratic Convention of Romania (CDR) if it fails to attend a meeting of CDR leaders scheduled for 1 August, RFE/RL's Bucharest bureau reported. The CDR statutes stipulate that if a formation fails to attend two consecutive CDR leadership meetings, it will be automatically excluded from the alliance. MS

HUNGARIAN OFFICIAL SAYS MINORITY FATE IS KEY TO RELATIONS WITH ROMANIA

Addressing the annual Balvanyos Summer University in Baile Tusnad on 27 July, Zsolt Nemeth, political secretary in the Hungarian Foreign Ministry, said Hungarian-Romanian relations are primarily determined "by what happens in Romania itself," Mediafax reported. He said the participation of the Hungarian Democratic Federation of Romania (UDMR) in the government since 1996 has been a "turning point" in Budapest's relations with Bucharest and that the future of those relations depends on Bucharest's attitude toward the Hungarian minority in Romania. Peter Eckstein-Kovacs, who is minister in charge of minority affairs in the Bucharest cabinet, denied that in the UDMR leadership there are "pro-communist forces" ready to collaborate with the Party of Social Democracy in Romania, as claimed by UDMR "radical wing" member Tibor Torro on 24 July at Balvanyos. MS

MOLDOVAN PRESIDENT PROMULGATES PARLIAMENTARY REPUBLIC LAW

Petru Lucinschi on 27 July promulgated the law transforming Moldova into a presidential republic, RFE/RL's Chisinau bureau reported. Lucinschi said that "as of the moment the law becomes effective, responsibility for the over-all situation in Moldova falls on the parliament's shoulders." Lucinschi on 20 July vetoed the law but was overridden by the legislature the next day. He said he still "vehemently" opposes the bill but had no choice but to promulgate it, otherwise he would have violated the constitution. He once more called on the parliament to call a referendum on his proposal to increase the presidential powers. MS

OSCE TO SEND PEACEKEEPING FORCE TO TRANSDNIESTER?

Chairman of the State Commission on the Transdniester Yevgenii Primakov and OSCE rotating chairwoman Benita Ferrero- Waldner have held "preliminary talks" on the possibility of deploying an OSCE peace-keeping force in the separatist region, OSCE Secretary-General Jan Kubis told an RFE/RL correspondent on 27 July. Primakov and Ferrero-Waldner met in Vienna earlier this week. Kubis confirmed that the Russians are again attempting to link the full withdrawal of their troops from the region to the conclusion of an agreement between Chisinau and Tiraspol on the future status of the Transdniester. He said the OSCE agrees that the region should have a special status but insists on the territorial sovereignty of Moldova as a whole. MS

BULGARIAN PARLIAMENT SACKS DEPUTY SPEAKER

The parliament on 27 July approved a resolution proposed by the ruling Union of Democratic Forces on removing deputy speaker Blagovest Sedonov from that post. Sedonov recently co- signed a letter to the Israeli parliament praising the decision of the Jewish National Fund to replace a memorial to King Boris III with one that hails the role played "by Bulgarians" in saving Jews during World War II (see "RFE/RL Newsline," 18 and 21 July 2000). The vote was 130 in favor with 80 against and 16 abstentions. The resolution said Sedonov had "discredited Bulgaria's parliament and people and damaged Bulgaria's image abroad." Sedonov, an independent, was elected to the parliament on the lists of the opposition Socialist Party, which said the government is ignoring the country's history and "glorifying the wartime monarchist regime." MS




PUTIN TO MEET OLIGARCHS


By Donald Jensen

In recent weeks, Russian President Vladimir Putin has seemingly begun to carry out his election promise to reduce the influence of the notorious "oligarchs," who grew rich during the Boris Yeltsin era owing to their close ties to government officials and easy access to public funds. So far, however, he has largely settled scores with the Kremlin's political and business opponents, leaving magnates close to him untouched.

His meeting with a group of leading oligarchs on 28 July may be a first step toward the creating a fairer economic playing field or toward reasserting the role of the state. But it is unlikely to address a more fundamental problem-- namely, the relationship between property and political power. Putin's rhetoric notwithstanding, he does not have the power, nor has he so far revealed the intention, to seek to break the link between the two.

Putin has moved against several leading business empires, including Media-MOST, LUKoil, and Norilsk Nickel, whose owners have been accused of crimes ranging from embezzlement to tax evasion. Media-MOST owner Vladimir Gusinskii has long been critical of the government, especially the war in Chechnya, and last year he supported the Fatherland movement of Yevgenii Primakov and Yurii Luzhkov, at the time both rivals of Putin. LUKoil's Vagit Alekperov is close to powerful Tatarstan President Mintimer Shamiev and also backed Fatherland, while Norilsk Nickel owner Vladimir Potanin has never been close to this Kremlin.

By contrast, Kremlin "bankers" Roman Abramovich and Aleksandr Mamut, who financed Putin's election campaign, have been spared by the president. In fact, several of Putin's steps so far have benefited their business interests. Accusations of tax evasion against LUKoil, for example, may have been intended in part to eliminate it from the running for the state-controlled oil-company ONAKO, Russia's 12th largest oil producer, whose majority stake went on sale on 21 July. Abramovich's Sibneft company and Transneft, controlled by Semyon Vainshtok, another pro-Putin oligarch, are said to be considering strong bids.

While there has been much ado about Boris Berezovskii's public break with the president and his intention to create an opposition party, Berezovskii himself recently installed his daughter on the board of Russian Public Television, which remains in his control. The state-owned Vneshtorgbank, for its part, indicated it may lend Berezovskii $85 million to operate the channel.

Putin's strong-arm tactics have relied on the Ministry of Internal Affairs, the Federal Security Service (FSB), the tax police, and the prosecutor-general--rather than the courts--to bring the oligarchs to heel. The "Family"--the Kremlin group that includes former Yeltsin speechwriter Valentin Yumashev, Yeltsin's daughter, Tatyana Dyachenko, and presidential administration chief Aleksandr Voloshin, as well as Mamut and Abramovich--reportedly favors maintaining a few large oligarchic empires that are independent but close to the Kremlin (Prosecutor-General Vladimir Ustinov is reported to be an ally of The Family).

A second group, concentrated in the FSB and the newly empowered Security Council, would prefer to wipe out the oligarchs and transform Russia's large businesses into state companies headed by proteges of the president. Putin does not appear to have firmly committed to either option to date.

Even if the most notorious oligarchs were removed, however, it would do little to untangle the interpenetration of business and politics that is a fundamental aspect of the Russian political scene. Alliances between governors and regional oligarchs--sometimes forged against the will of better known magnates from Moscow--are common. At the federal level, ministries routinely engage in commercial activities. And even presidential administration head Voloshin qualifies as an oligarch in his own right.

Perhaps more significantly for Putin, the security services on which he relies have long been as much motivated by money as by serving the public interest. Many large firms employ former FSB intelligence officers, and ties undoubtedly remain strong between the latter and Lubyanka. Interior Minister Vladimir Rushailo, one of Russia's major law enforcement officers, was reported to have been extensively involved in entrepreneurial activity when he headed Moscow's organized crime directorate in the early 1990s. Among his alleged activities was providing protection to major Moscow firms in exchange for corporate contributions. In the regions, governors and the firms that support them often supplement the federal salaries of law enforcement officials out of their own pocket--a telling indicator of their lacking loyalty to the Kremlin.

Among the 18 business officials invited to attend Putin's 28 July meeting with business leaders are Alekperov, Gazprom chief Rem Vyakhirev, and Yukos head Mikhail Khororkhovskii, as well as an executive from the telecommunication company Vympelcom. Berezovskii and Gusinskii reportedly have not been invited. Union of Rightist Forces faction leader Boris Nemtsov, who along with Voloshin pressed for the meeting, has predicted that business leaders will propose a three-point declaration in which the Kremlin agrees to stop investigations into past privatization deals and get rid of corrupt bureaucrats, "beginning with the Prosecutor-General's Office." In return, the oligarchs would agree to "play by the rules"--that is, pay all taxes and obey the law.

Predictably, Kremlin sources have said it is unlikely that any agreement will be signed.

The author is associate director of RFE/RL's Broadcasting Division.


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