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Newsline - August 18, 2000




RUSSIA KEEPS UP EFFORTS TO SAVE 'KURSK' CREW...

Four Russian submersibles were "working non-stop" to dock with the sunken "Kursk" nuclear submarine on 18 August, according to a Northern Fleet spokesman, who added that those efforts had so far proved unsuccessful. Strong underwater currents and poor visibility caused by clouds of silt along the sea bed have continued to hamper efforts to rescue the 118 people reported to be aboard the vessel. In addition, Navy spokesman Igor Dygalo said the "Kursk" is slowly sinking into the mud; although this does not "significantly impact" the rescue operation, the submarine is already leaning at a sharp angle, he added. Meanwhile, British forces equipped with an LR5 submersible and Norwegian divers are still making their way to the scene of the accident but are not expected to arrive there until the weekend. "Nezavisimaya gazeta," which is controlled by Boris Berezovskii, commented on 18 August that the Russian rescue operation resembles a farce and that the only hope left for the stricken crew is the British rescue team. JC

...WHILE KLEBANOV REVEALS EXTENT OF DAMAGE

Following an eight-hour session of the government commission investigating the circumstances of the "Kursk" accident, Deputy Prime Minister Ilya Klebanov told journalists on 17 August that there was a "terrifying hole" in the bow of the submarine. Many of the crew were in the part of the boat that was "hit by the catastrophe, " he noted, adding that evidence suggested the submarine hit a "huge unspecified object" some 20 meters below the surface and sank to the sea bed within a few minutes. Klebanov also said there had been no sounds coming from the submarine for "quite a long time." The same day, the Russian Northern Fleet's press service issued a statement denying media reports that crew members on the "Kursk" had resumed tapping messages on the walls of the submarine. JC

PUTIN SKIPS CIS SUMMIT...

President Vladimir Putin, who has been fiercely criticized by some Russian media over the "Kursk" rescue operation (see "RFE/RL Newsline," 17 August 2000), will not attend a summit of CIS heads scheduled to take place in Yalta on 19 August. Putin arrived in Crimea on the morning of 18 August but will travel to Moscow the same day. Russian agencies quoted Putin as saying in Crimea that he trusts the military who are overseeing the rescue operation in the Barents Sea and did not rush to the accident area because he did not want to hamper their efforts. Many Russian media outlets have slammed Putin for not interrupting his vacation on the Black Sea following the "Kursk" crisis. JC

...AS NAVAL OFFICER CONTINUES TO HOLD TALKS IN BRUSSELS

Navy Deputy Chief of Staff Vice Admiral Aleksandr Pobozhy was due to meet with NATO officials in Brussels on 18 August to discuss "technical issues" related to the operation to rescue the crew of the "Kursk," ITAR-TASS reported, citing unidentified diplomatic sources. The previous day, Pobozhy had met with NATO representatives who informed him of their governments' proposals for assisting the Russian rescue operation, according to the Russian news agency. Meanwhile, the arrival of CIA head George Tenet in Moscow on 18 August prompted speculation that his visit may be related to the "Kursk" crisis, but Interfax reported that the visit had been arranged before the sinking of the submarine. Reuters quoted the U.S. embassy in Moscow as confirming Tenet's arrival in the Russian capital but as saying it could not say when the trip was arranged. JC

PRIKHODKO SAYS WESTERN MEDIA 'BLUNDERED' OVER KIM JONG-IL'S DENIAL

Russian presidential aide Sergei Prikhodko said in Yalta on 18 August that Western media reports saying that North Korean leader Kim Jong-il was joking when he suggested Pyongyang would renounce its missile program under certain conditions were a "blunder on the part of Western journalists," Interfax reported. Prikhodko argued that there is a "discrepancy" between Kim's statements and subsequent Western press reports. "The Russian press blunders at times as well, but much more rarely than the Western press," Prikhodko remarked. JC

GOVERNMENT TO TRIM FEDERAL PROGRAMS

Minister for Economic Development and Trade German Gref told reporters on 17 August that the Russian government will eliminate more than 100 federal programs beginning in 2002, ITAR-TASS reported. According to Gref, the country currently implements 172 federal programs at a cost of 50 billion rubles ($1.8 billion). As of 2001, the government will allocate up to 26 billion rubles for 72 federal programs, according to RIA Novosti. Gref added that the government plans to have no more than 30 programs in place by 2002. According to Gref, Russia has simply too many programs, and he singled out one providing for the "relocation of musk-oxen to historical territories," which he said discredits the status of federal programs. Some 92 programs are scheduled to expire in 2000 and will not be renewed. JAC

MORE LONDON CLUB MEMBERS SIGN UP FOR DEBT SWAP

Prime Minister Mikhail Kasyanov announced on 17 August that some 98 percent of London Club members have agreed to swap Russia's Soviet-era debt for new Russian Eurobonds. Kasyanov's announcement came on the day that the deadline expired for accepting bids for the exchange of Soviet-era debt owed to the London Club of creditors, Interfax reported. With applications from some 95 percent of creditors received last week, the Russian government extended the deadline in order to increase London Club member participation (see "RFE/RL Newsline," 14 August 2000). JAC

MOSCOW WELCOMES DUTCH RULING OVER TALL SHIPS

The Russian Foreign Ministry on 17 August welcomed a Dutch district court's ruling banning the seizure of three Russian tall ships during the Amsterdam regatta next week. The seizure of those vessels had been demanded by the Swiss company Noga, which say that the Russian government owes it some $800 million. Last month, French bailiffs seized the Russian tall ship "Sedov" at Noga's request, but 11 days later the Brest county court ordered its release (see "RFE/RL Newsline," 25 July 2000). JC

CHECHEN PRESIDENT DENOUNCES DUMA BY-ELECTION

President Aslan Maskhadov has denounced the 20 August election of a deputy to represent Chechnya in the State Duma as "a crime against the Chechen people," AFP reported. Maskhadov called for the 13 candidates in the poll to be "punished." "The Moscow Times" on 17 August suggested that the poll is in fact a proxy struggle between Gudermes Mayor Malika Gezimeeva, who is backed by interim Chechen administration leader Akhmed-hadji Kadyrov, and Lecha Magomadov, head of the Chechen branch of the pro-Kremlin Unity party, who is supported by Kadyrov's rival and first deputy, Beslan Gantemirov. Kadyrov met in Sochi on 17 August with President Putin to brief him on preparations for the poll and on the domestic political situation in Chechnya, Reuters and Interfax reported. LF

POLICE CAR DESTROYED BY BOMB IN GROZNY

Two civilians were killed and four police officers injured when a car bomb destroyed a police car in Grozny on 17 August. A second car bomb in Achkhoi Martan destroyed a car belonging to the Central Electoral Commission but caused no injuries. LF

MORE INFORMATION LEAKED ON SECURITY COUNCIL MEETING

Although an official account of decisions reached at the 11 August Security Council meeting has not yet been made public, "Obshchaya gazeta" provided some detailed information in its issue no. 33. According to the weekly, by the end of 2001 the Strategic Missile Forces will lose a division as well as 26 launchers of R-36M missiles, also known as the S-18 Satan. Five regiments stationed in the city of Aleisk in Altai Krai will be disbanded. In addition, by 2003 the armed forces will become transformed into a three-branch structure composed of the air force, navy, and ground forces. Last week, Air Force Commander Anatolii Kornukov confirmed that the Strategic Rocket Forces would be transferred to his command within two years (see "RFE/RL Newsline," 15 August 2000). JAC

BUDGET SUBMITTED TO GOVERNMENT

The Finance Ministry submitted the draft 2001 budget to the government on 17 August. The parameters of the document are the same as those revealed last week, with the exception that revenues and expenditures have been increased slightly from 1.187 trillion rubles ($43 billion) to 1.193 trillion rubles. GDP is still estimated at 7.75 trillion rubles, annual inflation at 12 percent, and the average ruble dollar exchange rate at 30 rubles per dollar (see "RFE/RL Newsline," 10 August 2000). The budget is scheduled to be submitted to the Duma on 26 August, and a first reading is scheduled for October, according to "Kommersant-Daily" on 15 August. JAC

DISPUTE BETWEEN ELECTRICITY MONOPOLY, RAILROADS TO MOVE TO LOCAL LEVEL

Unified Energy Systems (EES) and the Railways Ministry have reportedly reached an agreement on the latter's debt for electricity supplies, ITAR-TASS reported on 18 August. According to the agency, EES has promised to revoke an order by telegram to its regional branches instructing them to cut power to railways still owing money to the electricity monopoly. EES and the Railways Ministry have reportedly agreed to switch over to a system in which local railways make payments for their power consumption to local power suppliers. It was not clear from the new account how this would eliminate the ministry's debt, which EES estimated earlier at 3.5 billion rubles ($126 million) (see "RFE/RL Newsline," 14 August 2000). JAC

MAJOR AUTOMAKER AGAIN RAISES PRICES...

AvtoVAZ, which produces the Niva car, among others, announced on 17 August that it is raising prices on the majority of its car models by an average of 1 percent, RFE/RL's Russian Service reported. According to ITAR-TASS, this is the second time in recent months that the Samara-based automobile manufacturer has raised its prices. JAC

...AS HIGHER PUMP PRICES FORESEEN

In an interview with Ekho Moskvy on 17 August, Russian Fuel Union head Sergei Borisov predicted that gasoline prices may soar this fall by an average of 10 percent to reach the level recorded last fall of 6.7-6.9 rubles per liter for high octane fuel. According to Borisov, prices have already reached this level in some regions. JAC

NEW ESTIMATE OFFERED FOR RUSSIA'S INTERNET USERS

The number of Russians who have used the Internet at least once has now exceeded 9.2 million, Interfax reported on 17 August, quoting Andrei Milekhin, director-general of the Agency Monitoring.ru (see ). Milekhin is predicting that Russia's Internet users might grow to some 11 million by the end of the year, with a weekly figure of 3.5 million. Last April, International Data Corp. estimated that 2.0 million people in Russia were using the Internet and projected a 40 percent rise in their number by the end of the year (see "RFE/RL Newsline," 19 April 2000). JAC

VILLAGERS RESTORE NICHOLAS II TO PLACE OF HONOR

A new monument of Tsar Nicholas II will be unveiled in the village of Taininskoe Mytishchenskoe in Moscow Oblast on 20 August, the website reported on 18 August. A first monument to Nicholas was destroyed in the spring of 1997 by "left extremists" after its unveiling in May 1996. Recently, however, Vyacheslav Klykov, the sculptor of both the new and old monument, decided that a new Nicholas should be constructed in its place. According to Klykov, the site of the new monument has already been blessed by Patriarch of All-Russia and Moscow Aleksii II. The Russian Orthodox Church recently decided to canonize Nicholas and his family (see "RFE/RL Newsline," 15 August 2000). JAC

SIT AND READ ONLY 'NEWSLINE'

The federal Media Ministry on 17 August suspended the broadcasting license of the Yekaterinburg-based television company ATN for two months because the station had been using subliminal advertising or "one-sequence inserts that viewers cannot perceive visually" but are reported to be registered subconsciously by viewers. The station periodically flashed on Sverdlovsk's channel 34 five one-shot inserts reading "Sit and Watch only ATN." First Deputy Media Minister Mikhail Seslavinskii noted that "today [Russia] does not have any guarantees that any company might conduct a similar experiment, referred to in textbooks as one of standard methods of psychological warfare," according to the website . JAC




PARTY ALLEGES 'BLACKMAIL' BY ARMENIAN GOVERNMENT

A member of the governing board of the People's Party of Armenia (HZhK) told RFE/RL's Yerevan bureau on 17 August that the party considers the recent dismissal of several of its members from government positions as official retaliation for the party's criticism of the government's economic policy. The HZhK forms the majority Miasnutiun parliamentary faction in tandem with Prime Minister Andranik Markarian's Republican Party of Armenia but is widely believed to be considering leaving Miasnutiun and aligning with the opposition Right and Accord bloc (see "RFE/RL Caucasus Report," Vol. 3, No. 31, 3 August 2000). A senior Republican on 16 August admitted political motives behind the sackings and accused the HZhK of thwarting government efforts to implement the bloc's 1999 electoral platform. LF

ARMENIA, GEORGIA ASK UN FOR DROUGHT RELIEF

UN officials said in Geneva on 17 August that both countries have requested aid in the form of flour, seed grain, and diesel fuel to counter the effects of this summer's drought, the worst in Georgia in almost 4O years. In eastern Georgia, grain and sunflower crops covering almost 100,000 hectares have perished. A UN official told Reuters that while Georgia does not face imminent food shortages, aid is nonetheless needed to prevent the threat of hunger in the next few months. LF

GEORGIAN TRIAL OF JEHOVAH'S WITNESSES' ATTACKERS ADJOURNED

A Tbilisi district court on 17 August adjourned the trial of followers of a Georgian unfrocked priest who are accused of assaulting Jehovah's Witnesses in Tbilisi last fall. That action came after sympathizers of the accused assaulted a Georgian human rights activist, a lawyer for the Jehovah's Witnesses, and a correspondent for RFE/RL's Tbilisi bureau (see "RFE/RL Newsline," 17 August 2000). The trial is scheduled to resume on 18 September. LF

AZERBAIJANI JOURNALISTS JOIN HUNGERSTRIKE TO PROTEST LAW SUIT AGAINST NEWSPAPER

Journalists from 10 publications have joined in the hunger strike begun earlier this week by four journalists with the independent newspaper "Uch nogte," Turan reported on 17 August. They are protesting the legal action taken against the newspaper by Azerbaijan's Information Minister Siruz Tebrizli. Tebrizli is demanding the newspaper's closure in accordance with a provision of the media law that requires the closure of publications taken to court three times over a 12-month period for publishing erroneous information (see "RFE/RL Newsline," 16 August 2000). Newspaper editors have applied to the Baku municipal authorities for permission to picket the Ministry of Information on 23 August and to convene a demonstration on 25 August to protest the planned closure of "Uch nogte." LF

EXILED AZERBAIJANI EX-PARLIAMENT SPEAKER PLANS TO RUN FOR PARLIAMENT

The Democratic Party of Azerbaijan will nominate its chairman Rasul Guliev to contest the 5 November parliamentary poll in the Khatai district of Baku, from which he was elected to the parliament in 1995, Caspian Press reported on 17 August. Guliev has lived in the U.S. since resigning as parliamentary speaker in September 1996. The Democratic Party has compiled a list of 81 candidates who will run in single mandate constituencies. The party was formally registered with the Ministry of Justice in February 2000 and is thus ineligible to contest the 25 mandates to be allocated under the proportional system. LF

SUSPECTED MURDERER OF KAZAKH ARMS EXPORT OFFICIAL COMMITS SUICIDE

Amangeldy Amanghaliev, a suspect in the April murder in Almaty of Talghat Ibraev (see "RFE/RL Newsline," 18 April 2000), shot himself late on 16 August when police tried to arrest him in an Almaty restaurant, RFE/RL's bureau in the former capital reported. AmanghAliyev was the son of a senior KGB official and graduated from Moscow State University after serving with the Soviet Army in Afghanistan from 1984-1986. Four other people, including the president of Kazakhstan's state arms export company and a colonel in the Kazakh intelligence service, have also been arrested in connection with the death of Ibraev (see "RFE/RL Newsline," 22 May and 6 June 2000). LF

KYRGYZ ROUNDTABLE POSTPONED

The roundtable discussion between representatives of the Kyrgyz leadership, opposition, media and NGOs, originally scheduled for 26 August (see "RFE/RL Kyrgyz Report," 14 August 2000) has been postponed because of the fighting in the south of the country, a presidential administration spokesman told RFE/RL's Bishkek bureau on 17 August. The discussion will now take place next month. Also on 17 August, Central Electoral Commission Chairman Suleiman Imanbaev told ITAR-TASS that the 29 October presidential election will not be postponed because of the fighting. He added that such a postponement is possible only if the Kyrgyz parliament votes to introduce martial law or a state of emergency. LF

JOURNALIST HOSPITALIZED AFTER INTERROGATION IN KYRGYZSTAN

Svetlana Krasilnikova, who is deputy editor of the independent weekly "Delo Nomer," was hospitalized with cardiac pains in Bishkek on 17 August, the day after being subjected to an eight-hour interrogation by the Kyrgyz Security Ministry, RFE/RL's Bishkek bureau reported. The Prosecutor-General's Office opened a court case against the newspaper earlier this month on charges of divulging state secrets in its reporting of the trial of former Security Minister Feliks Kulov. LF

DEATH TOLL RISES IN FIGHTING IN KYRGYZSTAN

The secretary of the Kyrgyz Security Council, General Bolot Djanuzakov, told journalists in Bishkek on 17 August that another seven Kyrgyz troops were killed in clashes with invading Islamic militants the previous day, Reuters and RFE/RL's Bishkek bureau reported. Interfax quoted him as saying that Kyrgyz forces have regained control of areas of Batken Oblast earlier taken by the invaders. Djanuzakov said that fighting is continuing near the Ak-Tubek glacier, which is located close to the Toeroe pass on the Kyrgyz-Tajik border. He said two Kyrgyz pilots suffered burns, but managed to make an emergency landing after their helicopter came under fire in Batken. LF

UZBEK OFFICIAL SAYS FIGHTING 'NEARING COMPLETION'

Uzbek Defense Ministry official Major General Yurii Filonenko told Russian agencies on 17 August that the military phase of the operation to neutralize the Islamic militants is almost over. He said that border guards and Interior Ministry troops will comb the border regions to round up militants and any who avoid capture will be starved out. Meanwhile, Human Rights Watch released a press statement in New York on 17 August calling on both the governments of the Central Asian states and the Islamic insurgents to respect the rules of armed conflict and to try to avoid civilian casualties. HRW also warned against intensified repression against religious believers and opponents of the regime in Uzbekistan. LF

TAJIKISTAN ASSUMES SOLE CONTROL OF MINING COMPLEX

Following a government resolution of 19 July, Tajikistan's Committee for Precious Metals has taken over the administration and exploitation of the Altyn-Topkan zinc and lead mine, Asia Plus-Blitz reported on 17 August. The mine, which located on Tajik territory, had been jointly worked with Uzbekistan since before the collapse of the USSR in 1991. The two countries had begun negotiations in 1996 on Tajikistan's assuming full responsibility for the mine. LF




BELARUSIAN PRESIDENT SLAMS LAW ENFORCEMENT BODIES

Alyaksandr Lukashenka on 17 August harshly criticized law enforcement bodies in Belarus for what he sees as their inefficiency in combating crime and their involvement in corruption, Belarusian Television reported. Lukashenka listed the KGB, the Interior Ministry, the Border Troops, the State Customs Service, the State Motor Vehicle Inspectorate, and public prosecutor's offices as being guilty of poor performance, corruption, bribery, and overreporting their successes. "The KGB's performance is extremely negative. Sometimes I am informed by ordinary people about the things the KGB should inform me of," Lukashenka said. "I will not even speak about the Customs Service--it's a total failure from the viewpoint of corruption," he added. "I receive complaints and appeals regarding the impudent, incoherent, stupid, and anti-state behavior of the State Motor Vehicle Inspectorate," Belarusian Television quoted him as saying. JM

UKRAINE TO REVAMP EDUCATION SYSTEM

The Education and Science Ministry has adopted plans to reform the secondary education system, Interfax reported on 17 August. The ministry proposes that the current 11-year education system be replaced by a 12-year one. Other changes include the introduction of a 12- grade scale for evaluating students' performance, instead of the current five-grade one, and the division of the school year into two "semesters" instead of the current four "quarters." The ministry also decided to abolish as of 2001 the system of preferences in university entrance exams for the so-called medallists, that is, those students who graduate with the highest grades. JM

UKRAINE'S NAFTOHAZ NOT TO CREATE JOINT VENTURE WITH ITERA

Naftohaz Ukrayiny has said it will not create a joint venture with Itera, an international gas transport company that is believed to have strong links with Russia's Gazprom. Previously, the Ukrainian company had announced it would go ahead with such a venture. UNIAN quoted an Itera representative in Ukraine as saying that Naftohaz had come under pressure from other dealers in the oil and gas market that do not want the number of brokering companies to decrease. The planned join venture, according to that representative, would have eliminated several hundred small gas traders. However, the Moscow-based "Kommersant-Daily" reported the same day that Ukraine wants to buy Turkmen gas directly from Turkmenistan and needs Itera only as a shipping company, not as a broker. JM

ESTONIAN PUBLIC SIDES AGAINST NRG DEAL

A poll conducted by the EMOR agency indicated that a majority of Estonians oppose the planned sale of 49 percent of the country's main power plants to the U.S. company NRG Energy, ETA reported on 17 August. Of the respondents, 67 percent voiced opposition to the deal, while only 8 percent supported it and 19 percent had no opinion. Pollsters say the high number of those opposed can be attributed to opposition among citizens to selling items of national significance to foreigners as well as to comments by President Lennart Meri and the country's business elite arguing against the deal. Meanwhile, both sides in the protracted negotiations are working on finalizing such issues as the translation of the agreement. The government has voiced its commitment to the sale. MH

NO END IN SIGHT TO ORTHODOX SCHISM IN ESTONIA

The Council of Bishops of Russian Orthodox Church has reaffirmed its non- recognition of the Constantinople-backed Estonian Apostolic Orthodox Church and forbidden Russian Orthodox Church members to take part in events hosted by its rivals, BNS reported on 18 August. The council's resolution called the division of the Church in Estonia "forced." An unnamed cleric from the Russian Orthodox Church told BNS that the argument centers around property rights. Both Churches claim to be the official Orthodox Church in Estonia, and the two are involved in a dispute over legal and jurisdictional issues. MH

RIGA SHOPPING CENTER ROCKED BY EXPLOSIONS

The downtown Riga shopping center "Centrs" was rocked by two explosions on 17 August, leaving at least 21 people injured, three seriously, AP reported. Police Chief Valdis Pumpurs was among the injured, but investigators do not believe he was the target. The blasts occurred in the lobby of the supermarket, most likely in an area where shoppers leave their bags. BNS added that the government has called an emergency session and border guards have increased security at the country's borders. The two blasts, which took place at a 10-minute interval, were recorded by closed-circuit cameras in the shopping center and police are currently studying footage from them. This was the largest explosion in a public place in Latvia since the restoration of independence. MH

LITHUANIA CAUTIONS RUSSIA ON TRANSIT VIOLATIONS

Lithuanian Deputy Foreign Minister Vygaudas Usackas summoned Russian Ambassador Yuri Zubakov on 17 August to voice concern over violations in military transit procedures to and from Kaliningrad, BNS reported. Previously, a train carrying military cargo in the Vilnius region was sent back to Belarus after four armed Russian military escorts were discovered onboard without having first acquired permission--in violation of the transit agreement. Zubakov said such violations will not happen again. Usackas noted that the transit was otherwise "normal." Border guards at the Kena checkpoint have since been disciplined over the incident. MH

NAZIS RALLY IN KAUNAS

The unregistered radical Lithuanian National Social Union held a rally outside Kaunas City Hall on 16 August, just one week after a similar rally in the city of Siauliai, BNS reported. Party leader Mindaugas Murza told a crowd of about 150, some of whom were wearing Swastika-like symbols, that they are coming "to rescue the nation." Anti- Semitic statements were made at the rally, as well as harsh criticism of the national government, according to the BNS report. Radical Kaunas Mayor Vytautas Sustauskas was present at the rally for about half an hour and spoke to Murza at one point. Siauliai Mayor Vida Stasiunaite of the New Alliance (Social Liberals), who took part in last week's meeting, has been accused of being in cahoots with the National Socialists (see "RFE/RL Newsline," 10 August 2000). MH

SOLIDARITY LEADER WANTS RIGHT WING TO UNITE BEFORE ELECTIONS

Marian Krzaklewski said on 17 August that he would like to see the right wing united before the first round of presidential elections due on 8 October, PAP reported. Krzaklewski added that he has already set dates for his meetings with the election committees of two right-wing candidates, Jan Olszewski and Jan Lopuszanski, to discuss a possible alliance. As regards talks with former Solidarity leader Lech Walesa, Krzaklewski said he believes in Walesa's "intuition in major Polish political matters." Walesa previously asked Krzaklewski to quit the presidential race and support his candidacy instead. Meanwhile, presidential candidate Jan Olszewski has been injured in a car crash and is now in hospital. His election team said, however, that he will not quit the race. JM

POLL SAYS POLISH INCUMENT PRESIDENT CAN WIN IN FIRST ROUND

A poll conducted by the Demoskop polling agency in early August found that President Aleksander Kwasniewski would have received 58 percent of the vote if elections had been held at that time. Andrzej Olechowski would have received 10 percent backing, Marian Krzaklewski 7 percent, and Lech Walesa 3 percent. The Central Electoral Commission has registered 21 election committees of candidates seeking the presidential post. Each committee must supply by 24 August at least 100,000 signatures in support of its candidate so that the latter can register for the ballot. JM

POLISH POLICE BREAKS UP DRUG SMUGGLING GANG

Police officers have arrested four men and thereby broke up a ring that smuggled drugs from Poland to Germany, Polish media reported on 17 August. Police also seized $1 million worth of hashish, marihuana, ecstasy, and amphetamines. Meanwhile, Justice Minister Lech Kaczynski has agreed to extradite to Italy a Colombian national sentenced in Poland for smuggling cocaine. Italian authorities had requested his extradition on similar charges. JM

AUSTRIAN OFFICIAL UNSATISFIED WITH CZECH POSITION ON TEMELIN

Austrian Vice Chancellor Sussanne Riess-Passer said that the position of the Czech government on bringing the Temelin nuclear power plant into operation is "absolutely unconstructive," CTK reported, citing the Austrian news agency APA. Riess-Passer, the chairwoman of the controversial Freedom Party, said the Czechs have shown little willingness to discuss the security aspects of Temelin. She added that Temelin will be an issue that "we will very clearly be discussing in connection with the admission of new members to the EU." She also demanded that joint EU norms for nuclear safety be introduced. Temelin, a hybrid of Soviet and Western technology, is located near the Austrian border. PB

ADVISER TO CZECH PREMIER NAMED AS AUTHOR OF 'OPERATION LEAD'

Zdenek Sarapatka, an adviser to Milos Zeman, has testified to police that another Zeman adviser, Vratislav Sima, is behind the campaign aimed at discrediting Zeman rival and Chamber of Deputies deputy chairwoman Petra Buzkova, the daily "Mlada fronta Dnes" reported on 18 August. Officials in Zeman's governing Social Democrats are alleged to have approved of the writing of a document that listed Buzkova's weaknesses and specified steps on how to discredit and embarrass her in the press. Zeman has called the document a provocation. The campaign was dubbed "Operation Lead" because of Buzkova's initials, PB, which symbolizes lead on the periodic chart of the elements. Buzkova has sued an unknown person for slander. Sarapatka and Sima have refused to comment on the case. PB

POLL SHOWS SLOVAK REFERENDUM WOULD FAIL

A referendum to hold early elections proposed by former Premier Vladimir Meciar's Movement for a Democratic Slovakia (HZDS), is likely to fail for lack of participation, CTK reported. The poll, conducted by the Slovak Statistical Office Institute for Public Opinion Research at the end of July and beginning of August, found that only 29 percent of respondents would participate in the vote. Some 55 percent said they would not and the rest were undecided. For the plebiscite to be valid, more than half of all registered voters would have to vote. The HZDS and the Slovak National Party gathered more than 700,000 signatures in support of the measure. If enough signatures are valid, a referendum will be held before 6 December. PB

SLOVAK JUSTICE MINISTER OPPOSED TO OFFICIAL GAY PARTNERSHIPS

Jan Carnogursky said on 17 August that as long as he is justice minister, "homosexual partnerships will not be registered in Slovakia," CTK reported. Carnogursky, who is the chairman of the Christian Democratic Movement, said giving homosexual couples a status equal to that of heterosexual ones would "degrade" heterosexual families. Carnogursky refused to say whether he thought his stance could harm Slovakia's chances of joining the EU, four member countries of which recognize gay partnerships. Following his statements, the "Odlisnost" (Unlikeness) initiative, which fights for homosexual rights, called on Carnogursky to resign. PB

HUNGARIAN ROMA LEADER RETURNS FROM STRASBOURG

Aladar Kotai, leader of the Gypsy Minority Authority in Hungary's northeastern town of Ozd, said local officials in Strasbourg told him that they discourage Roma from fleeing Hungary. He said Romany refugees would not be welcome in Strasbourg, and asylum applications would be assessed on a case-by-case basis. Kotai said he will encourage Roma to remain in Hungary. In other news, residents of Budapest's 14th district are collecting signatures protesting the temporary housing of Romany families in the neighborhood. The 300 signatories claim that the 49 Roma threaten public security and decrease the value of apartments in the district. MSZ




EXPLOSION RIPS KOSOVA'S CAPITAL

An explosion on 18 August damaged a building in central Prishtina used by the OSCE for its program to promote democracy. The building is home to several ethnic Albanian and Serbian political parties. It also houses a restaurant, some trade union offices, and the offices of Belgrade's representatives in Kosova. A NATO spokesman said that one person was injured and several are in shock. He added that the explosion appears to have been caused by a bomb. Bernard Kouchner, who is the UN's chief civilian administrator in the province, said the bomb was planted by "enemies of democracy. A bomb is a very undemocratic means" of expressing one's views, AP reported. PM

BELGRADE WANTS UN MEETING ON KOSOVA MINE

Vladislav Jovanovic, who is Serbia's chief diplomatic representative at the UN, said in New York on 17 August that his government demands that the Security Council condemn the UN mission in Kosova's recent takeover of an environmentally dangerous mining complex (see "RFE/RL Newsline," 17 August 2000). Jovanovic dismissed Kouchner's expressions of concern about lead poisoning from the plant, calling his remarks "another cynical and transparent attempt to hoodwink world public opinion and the Security Council," AP reported. PM

UN SEEKS TO CLEAR UP KOSOVA PROPERTY DISPUTES

The UN civilian administration opened an office in Prishtina on 17 August to deal with some 100,000 property disputes that are an impediment to foreign investment in the province, Reuters reported. The problem of wartime destruction and dislocation is compounded by the fact that pre-1999 Serbian legislation discriminated against ethnic Albanians in matters regarding property sales and ownership. Since the conflict ended in June 1999, moreover, many Serbs and even Albanians have been forcibly evicted from their homes and flats. Several Kosovar Albanians have told "RFE/RL Newsline" in recent months that their flats were forcibly occupied by armed gangs from Albania. PM

SERBIAN AUTHORITIES DETAIN UN POLICEMAN...

A UN spokesman said in Prishtina on 17 August that Serbian authorities in Bujanovac are holding a UN policeman from an unnamed Asian country and his ethnic Albanian interpreter. Reuters reported that it is not unusual for foreign personnel in Kosova to stray across the border into Serbia and that the Serbian authorities usually release such individuals after a "short period of time." PM

...AND OPPOSITION POLITICIANS

Police at a toll station on a highway in Vojvodina detained Miodrag Isakov and Petar Petrovic from the opposition Reformist Party of Vojvodina on 17 August and took them to the police station in Novi Sad. Their party said in a statement that police freed the two men only after "holding them for three hours without any reason or explanation," AP reported. PM

ANOTHER PRIVATE SERBIAN RADIO STATION'S PROGRAMS BLOCKED

Serbia's Association of Independent Electronic Media (ANEM) said in a statement from Belgrade on 17 August that "the signal of Radio Jasenica in Smederevska Palanka has been [blocked] since the night of 16 August. Radio Jasenica is a member of ANEM.... Radio Jasenica technicians have determined that a new transmitter located near Smederevska Palanka is illegally broadcasting state media's first program on Jasenica's frequency. Listeners from Palanka, Pozarevac, Petrovac, and Veliko Gradiste have reported jamming [of Jasenica].... Radio Jasenica will urgently undertake all necessary legal remedies for protection from the appropriate state bodies. The Federal Ministry of Telecommunications has displayed enviable efficiency in closing ANEM television and radio stations which it claims have been operating illegally. ANEM demands that the Ministry act with equal efficiency to protect the legal broadcasting of Radio Jasenica and immediately remove the source of disruption on 88.3 MHz in order for Radio Jasenica to resume its operations undisturbed." PM

U.S. DEFENDS BUDAPEST OFFICE AGAINST SERBIAN REGIME, OPPOSITION CRITICISM

State Department spokesman Philip Reeker said in Washington on 17 August that the main purpose of the State Department's newly opened Budapest office is to "support the full range of democratic forces in Serbia and coordinate [those support activities] in Budapest" (see "RFE/RL Balkan Report," 18 August 2000). Both Serbian opposition presidential candidate Vojislav Kostunica and Deputy Prime Minister Nikola Sainovic have called the office an example of "gross interference" in Serbia's internal affairs. Reeker said: "We believe that Mr. Kostunica is indeed a genuine democratic leader, and he is entitled to his opinions. That doesn't mean that we have to agree with him in all of those opinions." Referring to Sainovic, Reeker noted that he is an indicted war criminal who, "like his cohort, [Yugoslav President Slobodan] Milosevic, and others, belongs in The Hague rather than trying to make comments about the opposition or democracy in Serbia," Reuters reported. PM

YUGOSLAV AUTHORITIES REJECT BRITISH PLEA OVER DETAINEES

Rade Drobac, who is Belgrade's chief diplomatic representative in London, told the BBC on 18 August that the Yugoslav courts will not allow themselves to be rushed in dealing with the cases of two Britons and two Canadians recently arrested while on vacation in Montenegro (see "RFE/RL Newsline," 15 August 2000). Drobac thereby indirectly rejected demands by the Foreign Office that the Yugoslav authorities either charge the four or release them. Drobac said: "It is a simple case in which [the men] were found without papers. They were found with detonators and wires for explosives. I believe that everyone with a lot of sense will understand that something is essentially wrong." The detonation equipment was in the car of one of the Canadians, who is a construction contractor. In Belgrade, British diplomat Robert Gordon told reporters that he hopes nonetheless that "something happens and that [the men] are released soon." He did not elaborate, AP reported. PM

NORWEGIAN ASPHALT ARRIVES IN SERBIA

Some 98,000 tons of asphalt arrived in Novi Sad as a gift of the Norwegian government, RFE/RL's South Slavic Service reported on 18 August. The gift is part of the EU-sponsored "Asphalt For Democracy" program aimed at helping opposition-run towns repair roads. PM

MONTENEGRIN RIVALS AGREE ON NEED FOR PEACE

Several leading officials of the Democratic Party of Socialists (DPS), which supports Montenegrin President Milo Djukanovic, and of the Socialist People's Party (SNP), which backs Milosevic, discussed the current political situation in and around Montenegro in Podgorica on 17 August, Montena-fax reported. The participants agreed on the importance of continuing their frank discussions and on preserving peace. The members of DPS delegation were Vice Presidents Filip Vujanovic and Svetozar Marovic, President of the Executive Board Miodrag Vukovic, and legislative faction leader Dragan Djurovic. The members of the SNP delegation were Vice Presidents Zoran Zizic, Predrag Bulatovic, and Srdja Bozovic, as well as party political affairs director Vuksan Simonovic. PM

THREE DEAD IN BOSNIAN MINE ACCIDENT

A Swedish expert on land mines, a Bosnian member of a de-mining team, and a Bosnian policeman were killed at Rogatica east of Sarajevo on 17 August as they tried to remove the bodies of two other men from a minefield left from the 1992-1995 conflict. Reuters notes that "around 1,200 mine accidents were reported between the end of the war and March this year, 40 percent of them fatal and 20 percent involving children." PM

IZETBEGOVIC HAVING SECOND THOUGHTS ABOUT LEAVING BOSNIAN PRESIDENCY?

"Oslobodjenje" of 18 August quoted unnamed sources "close to Izetbegovic's office" as saying that Alija Izetbegovic, who is the Muslim member of the joint presidency, is "reconsidering" his earlier decision to resign his post (see "RFE/RL Newsline," 7 June 2000). PM

CROATIA SHIFTING STANCE ON PREVLAKA?

Defense Minister Jozo Rados said in Dubrovnik that he intends to turn over several military recreation centers on the Prevlaka peninsula to the civilian authorities, "Jutarnji list" reported on 18 August. In response to a reporter's question about the future of other military facilities on the peninsula, Rados said that the area might eventually have a "special status," by which he seemed to mean that it might be demilitarized. The governments of Croatia and Montenegro are anxious to end the dispute over the peninsula, which is Croatian territory and on which UN monitors are present. It controls access to Kotor Bay, which is the home of Yugoslavia's only deep-water naval base. Belgrade has shown little interest in ending the stand- off. PM

CLEANERS MAKE DISCOVERY IN SLOVENIA

Economics Minister Joze Zagozen told a press conference in Ljubljana on 17 August that cleaners recently discovered several listening devices in his offices. He said he will wait until he has more information before drawing any firm conclusions. The discovery appears to be but the latest chapter in an ongoing affair involving the ministry, state-run companies, and the police, "Dnevnik" reported. PM

ROMANIAN LIBERALS FACE TURMOIL IN CONGRESS

An extraordinary congress of the National Liberal Party (PNL) on 18 August is to approve the party's strategy for the upcoming parliamentary and presidential elections, Romanian media reported. Congress delegates are likely to support the nomination of Theodor Stolojan as the party's presidential candidate, although several PNL leaders have contested that decision. PNL branch leaders on 17 August called on Finance Minister Decebal Traian Remes to resign from the party owing to his staunch criticism of the party leadership and his support for Premier Mugur Isarescu. The previous day, the party's Senate, composed of the party's eldest members, announced it will support Isarescu instead of Stolojan. Party first deputy chairman and Justice Minister Valeriu Stoica had previously "shown the door" to all those disagreeing with Stolojan's nomination. ZsM

ROMANIAN PRESIDENT BLAMES JUDICIAL SYSTEM FOR SLOW FIGHT AGAINST ORGANIZED CRIME

At the a meeting of the Romanian Supreme Defense Council on 17 August, Romanian President Emil Constantinescu criticized the judicial system for dragging its feet on cases against organized crime suspects and those accused of corruption, Ziua reported. Observers note that Constantinescu's remarks were directed primarily at Justice Minister Valeriu Stoica. The minister, who did not participate in the meeting, denied the charges, saying that a minister "cannot influence justice and the magistrates are independents." The council discussed measures aimed at cracking down on corruption and analyzed a report on the fight against organized crime since 1997. It also decided to set up a National Security Authority. ZsM

OPINION POLL CONFIRMS ILIESCU'S DECREASING POPULARITY

An opinion poll released on 17 August confirms declining support for Party of Social Democracy in Romania chairman and former President Ion Iliescu, Romanian media reported. According to the poll, Iliescu has 31 percent backing, while Prime Minister Mugur Isarescu, who has not yet announced his candidacy, has the support of 22 percent. PNL candidate Theodor Stolojan received only 17 percent backing. The poll also revealed that both Isarescu and Stolojan would beat Iliescu in a runoff. On 16 August, Iliescu harshly attacked Stolojan, who was prime minister in 1991-1992 when Iliescu was president. ZsM

BULGARIAN PRESIDENT SACKS OFFICIAL OVER 'BUG GATE'

Petar Stoyanov signed a decree on 17 August dismissing General Bozhidar Popov from his post as chief secretary of the Interior Ministry for his part in the "Bug Gate" scandal, AP reported. That scandal is related to listening devices found in July in the apartment of the country's chief prosecutor. Popov directed a unit that was to remove secret eavesdropping devices from sensitive buildings. Stoyanov called for Interior Ministry officials "to regain Bulgarian citizens' trust in their institutions." Bulgarian Prime Minister Ivan Kostov had last week called for Popov to be sacked, and the government recently urged Stoyanov to dismiss the general (see "RFE/RL Newsline," 17 August 2000). Popov's post will be filled by Slavcho Bosilkov, who previously worked as Kostov's national security adviser. PB

GERMANY DAMPENS BULGARIAN HOPES ABOUT EARLY ENTRY TO EU

German Finance Minister Hans Eichel said after meeting with Bulgarian Premier Kostov and Finance Minister Muravey Radev on 17 August that countries aspiring to join the EU, including Bulgaria, should not expect to join before their economies are prepared for competition, dpa reported. Eichel said: "It is in the interest of the prospective members," as well as current members, "that the accession process...does not weaken the union but strengthens it." Bulgaria owes Germany--the leading investor in Bulgaria--some $215 million. PB

BULGARIAN BUSINESSMAN SHOT

Encho Stoev, the former director of Bulgaria's main oil refinery, was shot and injured by two men in Burgas on 17 August, AP reported. Stoev was the chief executive officer of the LUKoil Neftochim oil refinery. Stoev was able to shoot and kill one of the assailants. PB




SLOWER GROWTH DELAYS ARMENIA'S ECONOMIC RECOVERY


By Emil Danielyan

The Armenian economy, still in a deep post-Soviet slump, expanded in the first half of this year at the lowest rate registered in the last five years, bringing little alleviation of enormous hardships suffered by the vast majority of the population.

Official statistics that show Gross Domestic Product (GDP) at 2.6 percent higher than during the same period in 1999 confound the government's growth projections and are not anywhere near enough to comfort the body politic, analysts say. The continuing lack of investments and other chronic problems, they say, hamper the kind of upswing that would have a noticeable impact on low living standards.

Armenia has boasted single-digit growth rates since the virtual industrial collapse of the early 1990s. Strict monetary discipline may have led to relative macroeconomic stability, but has yet to generate economic recovery.

The latest growth figure is hardly encouraging for the government of Prime Minister Andranik Markarian which will increasingly need at least signs of a major socioeconomic improvement to justify its continued presence in office.

"This is not quite an indicator," said Sevak Lalayan, an economic analyst at the International Center for Human Development (ICHD), a Yerevan-based think-tank. "For Germany, for example, a one percent growth means billions of dollars. For Armenia, it's just a few million dollars. These percentage points are therefore misleading." "This country will get on its feet if its economy grows by at least ten percent for several years in a row," he told RFE/RL on 18 August.

The previous cabinet had forecast six percent growth for the year 2000. But even that projected rate will be unachievable if the current trends continue. Lalayan was more categorical when he said: "This year one should expect a three percent growth at best. Not more." This suggests that major change in the dire economic situation is unlikely to come about at least before the end of the year.

The authorities, however, hope that positive implications of the stabilization of the political situation in Armenia will begin to manifest themselves in the coming months. Last October's shock assassinations in the Armenian parliament and the ensuing turmoil in the country's leadership are thought to have undermined the trust of the domestic business community and potential foreign investors. The end of the power struggle in Yerevan last May definitely bodes well for economic activity.

Still, the existing situation is a source of concern, with unemployment still extremely high and public sector salaries and pensions not paid for months. The wage arrears may be a prelude to a serious budgetary crisis. The government said in June that that the shortfall in budget revenues could total 45 billion drams ($85 million) by the end of this year if the situation with tax collection does not improve.

A senior World Bank expert, Lev Freinkman, wrote in a recent report on Armenia that "the quality and sustainability of growth remains of major concern." "The main evidence of weaknesses in the existing growth pattern are inter-related and include: low investment rate and thus weak capacity to create new jobs,...low export, slow rate of enterprise restructuring in core manufacturing, underdeveloped financial system, and high income inequality," according to Freinkman.

ICHD's Lalayan singled out the lack of foreign direct investments (FDI) as the first and foremost problem preventing economic development. The total volume of such investments was less than $100 million last year.

Widespread corruption and the unfavorable investment climate are widely blamed for the low FDI rate in Armenia. More important, it appears, is the fact that Western firms are wary of doing business in Armenia and elsewhere in the South Caucasus because of uncertain prospects for the settlement of regional conflicts. The unresolved Nagorno- Karabakh dispute still hangs ominously over regional peace and stability. In addition, high transportation costs resulting from the closed borders with Azerbaijan and Turkey place a heavy burden on the Armenian economy.

Lalayan argued that the monetary policy of the Armenian Central Bank is excessively tight and also strangles the economy. Inflation was virtually non-existent in the first half, with the consumer price index rising by just 0.2 percent between December and June. For a country like Armenia this is an "awfully small" figure, he said.

There are, however, some bright spots in the overall grim economic picture. For the first time a surge in industrial output accounted for a large share of the growth. Armenian output (excluding energy production) was 7.4 percent up from the same period last year. Particularly strong was the growth in the production of consumer goods.

The country's huge trade deficit fell by 10 percent to $284.2 million, helped by a nearly 17 percent rise in exports. The government's program submitted to the parliament in June envisages that Armenian exports will grow by "at least 25 percent" beginning next year.

The government also set an ambitious goal of doubling Armenia's GDP in the next "seven to eight years." But with the current rate of growth that seems utopian.

The author is an RFE/RL corespondent based in Yerevan.


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