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Newsline - December 15, 2000




PUTIN, CASTRO TAKE STRONG STAND ON U.S...

On the same day he sent a message congratulating U.S. President-elect George W. Bush (see below), Russian President Vladimir Putin issued a joint declaration with Cuban leader Fidel Castro that endorsed the idea of a multi-polar world, slammed Washington over its trade embargo against Havana, and lambasted U.S. plans to deploy a limited national missile defense system. Speaking in the Cuban capital on 14 December after talks with Castro, Putin warned the U.S. that attempts at "world domination have been made numerous times throughout the course of history...and it is well known how they all ended." Castro thanked the Russian president for consistently opposing U.S. sanctions against Cuba and accepted an invitation to visit Moscow. The two leaders signed agreements on legal and health cooperation, avoiding double taxation, and trade targets for 2001-2005. And they also paid a visit to the Russian-run electronic intelligence center at Lourdes, outside Havana, which is widely believed to focus directly on Washington. JC

...AVOID THORNY ISSUE OF SOVIET-ERA DEBT

In their statements to journalists, neither Putin nor Castro mentioned the subject of Cuba's Soviet-era debt to Moscow, which Russian media put at some $20 billion. Putin, for his part, noted that a decision must be made on what to do with Soviet-era joint projects that remain unfinished, having reportedly failed during his talks with Castro to reach an agreement on that issue. Such projects include the Las Camariocas nickel ore processing plant, the Cienfuegos and Santiago oil refineries, and the Juragua nuclear plant, according to Reuters. The two leaders did, however, sign a protocol whereby Russia will extend a $350 million credit to Havana, first agreed on in 1993, to be used to complete industrial ventures. After wrapping up the official part of his visit on 15 December, Putin will spend two rest days at Cuba's Varadero beach, before flying to Canada for a three-day visit. JC

NEXT YEAR'S BUDGET CLEARS LOWER HOUSE

The draft 2001 budget passed in its fourth and final reading in the State Duma on 14 December by a vote of 309 to109 and no abstentions, ITAR-TASS reported. The Federation Council is expected to consider the bill at its next plenary session, on 20 December. Federation Council Chairman Gennadii Seleznev told reporters earlier that the upper chamber is not interested in dragging out the process of passing the budget since the regions need to have that document in place by the beginning of the year. Under the budget, both revenues and expenditures are set at 1.193 trillion rubles ($43 billion), while annual inflation is expected to total 12 percent and GDP 7.750 trillion rubles. Some 240 billion rubles are allocated for servicing the national debt and 219 billion rubles for national defense. JAC

UNIONS PREPARE FOR FIGHT OVER LABOR CODE

The Federation of Independent Unions on 14 December launched a week of protests with demonstrations against the proposed new Labor Code, which the State Duma is scheduled to consider on 21 December, "The Moscow Times" reported on 15 December. Protests were planned in cities such as Samara, Chelyabinsk, and Petropavlovsk-Kamchatskii. According to the daily, labor leaders object to a number of measures in the proposed code that would diminish the role of unions, make it easier to fire workers, and possibly extend the work week to 56 hours. Labor Minister Aleksandr Pochinok said on 14 December that he thinks discussion of the bill should be postponed and a conciliation commission formed to improve the code. According to the daily, Pochinok also expressed his exasperation at the unions for spreading "disinformation" about the legislation. For example, he says that the reasons for firing a worker differ little from those included under the current labor code, with the exception that the requirement of union consent is taken away. JAC

PUTIN TAKES ANOTHER JAB AT U.S...

In an interview with Canadian and Russian television journalists on 14 December, Russian President Putin reaffirmed Russia's desire for a multi-polar world. He said, "We believe that the world cannot develop efficiently and positively if we have to deal with one country's monopoly on taking and implementing by itself decisions that it regards as just." JAC

...DEFENDS HIS RECORD ON PRESS FREEDOM...

When asked about charges that his government is trying to limit press freedom, Putin said such criticism of his policies in Russia testifies to existence of free speech. Putin explained: "I don't see any restrictions because those who complain about various restrictions continue to criticize the president and the government in the harshest manner. And that's the main indicator...that the government is not restricting the press in any way." JAC

...APPEARS TO SHARE FSB'S VIEW OF DISPUTES WITH ENVIRONMENTALISTS

When asked about the arrests and trials of environmentalists in Russia, Putin stated that "there are quite a lot of detentions of ecological movement activists not only in Russia, but also in other countries." He also stressed that former military officers collecting and passing information to foreign nationals working for environmental organizations is not quite the same as protecting the environment. He added that the question as to whether one piece of information or another "is classified and whether it is time to declassify it is a question to be decided by the courts." On the issue of people facing trial for such offenses, Putin noted that "a normal process is under way." These people, according to Putin, "have the opportunity and the right to a defense." Last month, the military board of the Russian Supreme Court sent back for retrial the case of former military reporter Grigorii Pasko, who has been accused of treason for passing information to a Japanese television station about the Russian navy's environmentally hazardous handling of nuclear waste (see "RFE/RL Newsline," 22 November 2000). JAC

PUTIN CONGRATULATES BUSH

President Putin sent a congratulatory telegram to U.S. President-elect Bush on 14 December, following news of the latter's victory at the U.S. Supreme Court, Interfax reported. In his message, Putin said he hopes for "an intensive and constructive dialogue with you and your administration, the further deepening of productive and mutually beneficial cooperation between Russia and the U.S. in the interests of our countries and peoples, the strengthening of international security and strategic stability." State Duma Chairman (Communist) Gennadii Seleznev told reporters the same day that he is glad that the "nerve-wracking election campaign is over in America." He added that he expects the U.S. to learn a lesson from the election campaign and, possibly, to revise its election laws, noting that "they will hardly want to repeat their mistakes." JAC

MEDIA MINISTRY, UNION OF JOURNALISTS DO BATTLE

The Union of Journalists has appealed to the Prosecutor-General Vladimir Ustinov to examine whether Media Minister Mikhail Lesin should be held criminally responsible for hindering journalists' professional activities, Interfax reported on 14 December. The authors of the appeal accuse Lesin of interference in the activities of the mass media during the mayoral campaign in Sochi, which resulted in the closure of the private television channel Maks-TV (see "RFE/RL Russian Federation Report," 13 December 2000). In response to the appeal, the Ministry's press service said that the attempt by the union's leadership to "force the ministry to stop its work" is "irresponsible and destructive." JAC

POTENTIAL ROLE OF MIDDLE CLASS PONDERED

In an essay about Russia's middle class in its issue No. 47, "Ekspert" reports that according to pollsters the middle class in Russia numbers 4 million. The weekly argues that despite the middle class's small numbers, it can still play an active role in some socially important process." This is because at the political level, middle-class Russians "wield a major part of the national intellectual and financial resources." The middle class is also the trend-setting class because all advertising campaigns are directed at them "as major consumers of goods and services." In addition, middle-class Russians can offer the world "a wholly new, unusual, and strong image of Russia of the 21rst century." Last October, the State Statistics Committee reported that ranks of the middle class are growing (see "RFE/RL Newsline," 2 November 2000). JAC

ONE HEAD ROLLS IN FREEZING FAR EAST DISTRICT

The head of the administration of Kavalerovo Raion in Primorskii Krai Valerii Lomovtsev resigned on 14 December, ITAR-TASS reported. During a recent press conference, Emergencies Minister Sergei Shoigu, who is heading a special interdepartmental commission investigating the energy situation in the krai, had singled out officials in the raion for special condemnation (see "RFE/RL Russian Federation Report," 13 December 2000). According to ITAR-TASS, on 14 December there were still 6,000 people in the krai without heat in their homes, of whom 4,324 live in Kavalerovo Raion. JAC

IRAN'S CASPIAN ENVOY HOLDS TALKS IN MOSCOW

Citing "diplomatic sources," Interfax on 14 December said that Moscow is "very much satisfied with the tone" of talks between Iranian envoy Ali Ahani and Russian Deputy Foreign Minister Viktor Kalyuzhnyi on the status of the Caspian Sea. According to the news service, Ahani reaffirmed Tehran's willingness to participate in multilateral discussions about the disputed sea, which Kalyuzhnyi said will take place in Moscow in late January or early February 2001. Kalyuzhnyi said he and Ahani had made "significant progress" on narrowing the differences between their two countries' positions. Russia, together with Kazakhstan, advocates dividing the Caspian seabed into national sectors, modifying the existing median line. Tehran, however, would prefer exploiting the sea's resources on the condominium principle. It says that if the sea is divided into national sectors, then those five sectors should be equal. Iran's current sector accounts for 14 percent of the area of the Caspian. LF/PG

FORMER RUSSIAN DEPUTY PREMIER SAYS CHECHNYA NEAR 'DEADLOCK'...

In an interview published in the 14 December "Trud" and summarized by Interfax, Ramazan Abdulatipov, who served as Russian deputy prime minister in the early years of former President Boris Yeltsin's rule, said that Russian forces are ignoring the lessons of the past in Chechnya and that the situation there "is essentially again going into a deadlock." Abdulatipov also provided details on earlier failures by Moscow to respond in 1991 to a power-sharing agreement proposed by then Chechen President Dzhokhar Dudaev, and in December 1994 to prevent the Russian military storm of Grozny. PG.

...WHILE NORTH OSSETIAN PRESIDENT UPBEAT

Aleksandr Dzasokhov told ITAR-TASS on 14 December that Chechnya has entered what he called "a post-conflict construction period," claiming that "it is possible already to start a peaceful life." But federal forces announced the same day that they are stepping up security precautions to ward off increasingly active Chechen militants. On 15 December, "Izvestiya" reported that troops in Gudermes were placed on alert two days earlier in anticipation of a new attack. PG

ARE CHECHENS BEING RESUPPLIED BY AIR?

An officer in the Russian headquarters in Khankala told Interfax on 14 December that the Chechens may be receiving resupplies of ammunition by air. "Although no reliable evidence of this is available, it is quite possible," the officer said. He suggested that YAK-18 aircraft could enter Chechen airspace beneath federal radar. Meanwhile, the Georgian embassy in Moscow denied a Russian television report that there had been an airlift from Georgia to Chechnya, Interfax reported. Interfax also reported that the current commander of the combined federal forces group in the North Caucasus, Lieutenant General Valerii Baranov is to be replaced by Lieutenant General Vladimir Bulgakov, who is currently deputy commander of the North Caucasus Military District. The agency said that this was part of a normal rotation of commanders. PG




FORMER ARMENIAN PREMIER AGAIN CRITICIZES PARLIAMENT SHOOTINGS INVESTIGATION

Aram Sargsian, the brother and successor of slain Prime Minister Vazgen Sargsian, told journalists in Yerevan on 14 December that he does not believe military prosecutor Gagik Djahangirian has succeeded in determining who was behind the shootings in the Armenian parliament on 27 October 1999, in which his brother and seven other officials died, RFE/RL's Yerevan bureau reported. Sargsian, who earlier branded Djahangirian a coward, questioned the rationale for the release of close associates of President Robert Kocharian who had been detained on suspicion of involvement in the killings. Djahangirian has said that he will continue to investigate the possibility that the five gunmen who perpetrated the murders were acting at the behest of others. The gunmen insist they were acting alone. LF

INDEPENDENT ARMENIAN BROADCASTER MAY END TV BROADCASTS BECAUSE OF STATE PRESSURE

The Noyan Tapan news agency released a statement on 14 December saying that it may soon end its television broadcasts to prevent financial losses stemming from actions by government agencies. The government has demanded that the agency modify its antenna. The agency said that it considers the government actions to be "pressure on the free media masked under the camouflage of 'technical reasons.'" Power to Noyan Tapan's transmitter was cut off late on 30 October to prevent the broadcast of footage of the arrest earlier that evening of businessman Arkadii Vartanian (see "RFE/RL Newsline," 3 November 2000). LF/PG

AZERBAIJAN SEEKS EXPORT POSSIBILITY FOR SHAH DENIZ GAS

Following a meeting with Turkish Energy Minister Yuerdakul Yigitgueden in Baku on 14 December, Azerbaijani President Heidar Aliyev said that Turkmenistan is now the main obstacle to the construction of a Trans-Caspian gas pipeline from that country to Turkey via Azerbaijan and Georgia, ITAR-TASS and Turan reported. Aliyev added that if no progress is made on the Trans-Caspian project, Baku will consider exporting gas from the major Shah-Deniz Caspian deposit via Iran. Production at that field is due to begin in 2002. Aliyev said Iran has already agreed to import some of that gas. On 13 December, Turan had quoted Azerbaijan state oil company president Natik Aliyev as saying that Ankara has provisionally agreed to buy 1-2 billion cubic meters of Shah Deniz gas annually but that Baku wants a commitment from Ankara to purchase 5 billion cubic meters. Without specifying a figure, he said a contract on sales could be signed during President Aliev's planned visit to Turkey next month. Yigitgueden discussed the export of Shah Deniz gas via Georgia with Georgian President Eduard Shevardnadze before his arrival in Baku, Caucasus Press reported on 13 December. LF

AZERBAIJANI LEADERSHIP DISAPPOINTED BY OSCE MINSK GROUP VISIT

Azerbaijani Foreign Minister Vilayat Guliev told ANS TV on 13 December that his government is disappointed by the failure of the OSCE Minsk Group co-chairman to present new ideas for a settlement of the Karabakh dispute during their visit to Baku earlier this week (see "RFE/RL Caucasus Report," Vol. 3, No. 48, 14 December 2000). PG

COMPUTER VIRUS HITS AZERBAIJANI GOVERNMENT OFFICES

Baku's "Zerkalo" newspaper reported on 14 December that a new computer virus has struck computers in the government as well as in newspaper offices and banks. Officials do not know whether the virus was inserted into the system or if the outbreak will spread. PG

GEORGIAN OPPOSITIONIST WARNS OF RUSSIAN THREAT

Nodar Natadze, the leader of the People's Front of Georgia, said that if Georgia does not take measures to respond to the current Russian "threat," the country "will face the greatest disaster in its history," Caucasus Press reported on 14 December. He urged the government to seek help from the UN and OSCE to prevent Russia from seizing the Pankisi valley, where several thousand Chechen refugees have settled. In other comments, Natadze said that he opposes the introduction of dual citizenship, something, he argued, that is "against our national interests." PG

GEORGIAN PARLIAMENT APPROVES STATE BUDGET

The Georgian parliament on 13 December passed the state budget in the third and final reading, Interfax reported the following day. It is the first time ever that parliament has adopted a budget within the time frame set by the country's constitution. The final draft leaves both revenues and expenditures unchanged, at 839.7 million lari ($420 million) and 1.117 billion lari respectively (see "RFE/RL Newsline," 13 December 2000). The resulting 277.6 million lari deficit is equal to 4 percent of the country's GDP. Meanwhile, another member of the ruling Union of Citizens of Georgia parliamentary faction, Tamar Ninoshvili, has shifted her allegiance to the New Faction, Caucasus Press reported on 14 December. Her defection raises the number of members of that faction to 12. PG

ACCUSED IDP REFUSES TO PLEAD IN GEORGIAN ATTEMPTED ASSASSINATION CASE

Aleksandr Zakaraya, a displaced person from Abkhazia recently arrested in connection with the February 1998 attempt to assassinate Georgian President Eduard Shevardnadze, has refused to testify or plead at all on those charges, "Rezonansi" reported on 14 December. But Zakaraya has admitted that he was present at the scene of the attack, and he has blamed Shevardnadze for precipitating the war in Abkhazia, which culminated in the flight of some 240,000 of that republic's inhabitants. PG

KAZAKHSTAN'S PRESIDENT LASHES OUT AT OPPOSITION FIGURE...

In a two-hour interview aired on Kazakh Television on 13 December, Nursultan Nazarbaev accused opposition figure Seydakhmet Quttyqadam of taking money from the Russian secret services to spread discord among Kazakhs by classifying them into clans and hordes, RFE/RL's Kazakh Service reported on 14 December. In other comments, Nazarbaev said the Kazakh language might eventually be written in Latin rather than Cyrillic script but that scholars should devise a new transliteration system rather than copy that used by Uzbekistan. He also said that the Islamic holiday of Id-al-Fitr will not be marked as a national one, nor will the town of Turkestan be designated as the country's spiritual center. PG

...EXPRESSES SATISFACTION WITH DEFENSE CAPABILITY...

Nazarbaev also expressed his satisfaction with the current capabilities of Kazakhstan's defense forces. "The level of training in the armed forces and the availability of an air force and land-based armored military hardware ensure the required level of defense capability." But he said that more efforts must be devoted to improving morale among the troops. PG

...REDIVIDES DUTIES OF TWO MINISTRIES...

President Nazarbaev has issued a series of decrees whereby the Ministry of Economy is renamed the Ministry of Economy and Trade and the former Ministry of Energy is given the new name of Trade and Industry the Ministry of Energy and Mineral Resources, RFE/RL's Kazakh Service reported on 14 December. Nazarbaev promoted to the rank of deputy prime minister Viktor Shkolnik, who formerly headed the Ministry of Energy, Industry and Trade. He also appointed Berik Imashev to head the Anti-Monopoly Industry in place of Altai Tleuberdin, who has been named to head the staff of Prime Minister Qasymzhomart Toqaev. LF

...CURTAILS POWERS OF NATIONAL OIL COMPANY

Another presidential decree issued on 14 December strips the state oil company KazakhOil of the right to participate in production-sharing agreements on behalf of the state and receive royalties, Interfax reported. But the company retains the right to own state shares in agreements on the exploration, development, production, and refining of hydrocarbons and to keep the stake it currently owns in production and refining companies. LF

RUSSIA REINFORCES KAZAKH BORDER TO STOP DRUGS ILLEGAL MIGRANTS

The press service of the Russian Security Council told ITAR-TASS on 14 December that Moscow has reinforced its border with Kazakhstan to block the flow of drugs, contraband, and illegal migration. The council stressed that "the development of the situation on the Kazakh border shows that that direction is becoming more and more attractive for criminal groups." PG

KYRGYZ PARLIAMENT PROPOSED NEW TAXES PROVE UNPALATABLE

At the session of a joint parliamentary-governmental commission created to assess the new tax options proposed by President Askar Akaev (see "RFE/RL Newsline," 13 and 14 December 2000), parliamentary deputies reaffirmed on 14 December their opposition to raising the annual land tax from an average 221 soms ($4.50) to 559 soms per hectare, RFE/RL's Bishkek bureau reported. Parliamentary deputy Borubai Juraev argued that the increased rate would be "too heavy a burden" on the rural population. The average annual salary in Kyrgyzstan is $20 per month. Several parliamentary deputies have said they will boycott the 15 December parliamentary session, at which Akaev will participate in the debate on his tax proposals. LF

FORMER KYRGYZ DEPUTY PM CHARGED

The Kyrgyzstan government accused former Deputy Prime Minister Boris Silaev of breaking the law by transferring land title to a group interested in building a new market, Kyrgyz-Press reported on 13 December. Silaev left Bishkek permanently last month without giving any reason for doing so and now works for the Moscow city government (see "RFE/RL Newsline," 17 November 2000). PG

UZBEK PARLIAMENT ADOPTS BUDGET FOR 2001

Deputies approved the 2001 budget on 14 December in the final reading, Interfax reported. The budget sets revenues at 1.1528 trillion soms ($3.09 billion) and expenditures at 1.201 trillion soms. The resulting 57.5 billion som deficit is equal to 1.5 percent of GDP and will be compensated for by the proceeds of privatization (1 percent) and by loans from the Central Bank (1 percent). GDP growth for next year is forecast at 4.5 percent, while industrial output is expected to rise by 5.8 percent and agricultural production by 5.5 percent. LF

UZBEK PRESIDENT VIEWS RUSSIA AS PRIORITY PARTNER...

Islam Karimov on 14 December told ITAR-TASS that Russia is and will remain a priority partner for Uzbekistan. He added that Russia remains an equal and powerful partner but complained that "often we cannot combine these two concepts because as a rule, more accent has been placed on 'powerful' than on 'equal.'" Karimov stressed that "we want our relations to be built on an equal basis so that we are not a former Soviet republic." PG

...PLANS REFERENDUM ON PARLIAMENTARY REFORM

During an interval in the parliament session on 14 December, Karimov proposed holding a referendum on his earlier proposal to create a bicameral parliament, Interfax reported (see "RFE/RL Newsline," 26 May 2000). He said that referendum should take place before the next parliamentary poll, which is due in December 2004. Karimov repeated the argument that the lower chamber should concentrate on legislative activity, while the upper chamber would represent the interests of all the country's regions. He stressed, however, that his proposed reform should not be interpreted as reflecting dissatisfaction with the work of the present 250-deputy legislature or as heralding pre-term elections. LF

UZBEKISTAN MOVES TO CONTROL BORDERS

Uzbek and Kazakh officials told Interfax on 14 December that the delimitation of their mutual border is proceeding "normally." Meanwhile, Uzbekistan closed its border with Kyrgyzstan in order to control smuggling and prevent the spread of militants, Khabar news agency reported on 13 December. PG




MINSK SAYS OSCE MISSION EXCEEDS ITS MANDATE

Belarusian Foreign Ministry spokesman Pavel Latushka said on 14 December the Belarusian government perceives "some actions" by the OSCE Advisory and Monitoring Group in Minsk as "exceeding the framework of [the group's] mandate," RFE/RL's Belarusian Service reported. Latushka did not give details, adding only that Foreign Minister Mikhail Khvastou will soon discuss this issue with OSCE mission head Hans Georg Wieck. Meanwhile, KGB chief Leanid Yeryn accused the OSCE mission the previous day of violating "all international legal acts, from the 1976 [sic] Helsinki Act to the memorandum on the status of the OSCE [monitoring group in Minsk]." And Presidential Administration deputy chief Uladzimir Zamyatalin noted that the mission's aim is to assist the authorities in meeting international standards and "not to render help to subversive organizations and the opposition to undermine the power [system]." Wieck refuted those charges. JM

UKRAINE CLOSES CHORNOBYL FOR GOOD

At noon on 15 December, Ukrainian President Leonid Kuchma gave the order by means of a television link-up between Kyiv and the Chornobyl nuclear power plant to close the plant for good, AP reported. A Chornobyl operator pushed a switch activating the automatic safety system of the plant's only working reactor and shutting down the reactor, more than 14 years after the world's worst nuclear accident. "The world will become a safer place. People will sleep in peace," Kuchma said during a ceremony to commemorate the shutdown. The previous day, the parliament adopted a communist-sponsored non-binding resolution urging the government to postpone the shutdown at least until April. Kuchma dismissed the step as constituting "political games." JM

UKRAINIAN PRESIDENT CHARGED WITH BOMBING OPPONENT, FALSIFYING VOTES

Ukraine's scandal implicating President Leonid Kuchma and several top officials in criminal conspiracies took on even larger proportions on 14 December, when lawmakers in the parliament were shown a second videotape featuring former presidential bodyguard Mykola Melnychenko (see "RFE/RL Newsline," 14 December 2000). Melnychenko accused Kuchma of organizing a grenade attack on Natalya Vitrenko on 2 October 1999 to prevent her from running in last year's presidential ballot (see "RFE/RL Poland, Belarus, and Ukraine Report," 5 October 1999). Melnychenko also alleged that Kuchma ordered the falsification of the results of last year's presidential elections and this year's constitutional referendum. Melnychenko confirmed his previous allegation that journalist Heorhiy Gongadze was kidnapped by an Interior Ministry special task force, on Kuchma's instruction to Interior Ministry Yuriy Kravchenko. Prosecutor-General Mykhaylo Potebenko, for his part, told the parliament that the tapes featuring the interviews with Melnychenko are fabrications. JM

UKRAINIAN PARLIAMENT REQUESTS KUCHMA TO SACK SECURITY, CUSTOMS CHIEFS

The parliament on 14 December passed a resolution recommending that the president fire Security Service chief Leonid Derkach and Customs Service chief Yuriy Solovkov. The resolution, which was voted down the previous day, was proposed in connection with the search at Kyiv airport of the three deputies who brought the video tapes of Melnychenko's confession into the country (see "RFE/RL Newsline," 11 December 2000). The lawmakers blame Derkach and Solovkov for ordering the search and violating the deputies' immunity. Kuchma commented the same day that he will decide whether to dismiss Derkach and Solovkov after Prosecutor-General Potebenko investigates the airport incident. Asked to comment on Melnychenko's allegations on the second video tape, Kuchma said that "in the life of a president, every day [brings] ordeals." JM

IMF COMPLETES REVIEW OF ESTONIA'S PERFORMANCE

The Executive Board of the IMF has completed the second, and last, review of Estonia's economic program, ETA reported on 14 December. IMF deputy managing director Shigemitsu Sugisaki praised Estonia for the successful implementation of its macroeconomic and structural policies. In the first nine months of the year, the budget deficit was only 0.5 percent of GDP or 4 percent lower than in same period in 1999. Confidence in the currency board is high, the current account deficit remains moderate, the banking system has strengthened, and the unemployment rate has started to decline, Sugisaki noted. He welcomed the parliament's submission of a balanced budget for 2001 and its commitment to protect the balance of payments by aiming for a fiscal surplus next year, if economic activity turns out to be stronger than expected. However, he noted that the authorities need to avoid a recurrence of excessive credit growth and that the retirement age may have to be raised again to ensure the financial viability of the pension system. SG

LATVIAN PREMIER MEETS FRENCH BUSINESSMEN

Andris Berzins on 14 December urged representatives of the French business confederation MEDEF to increase their economic ties with and investments in Latvia, LETA reported. MEDEF, which represents more than 1 million companies grouped into 85 business federations, established a committee for the Baltic states this year. Berzins noted that Latvia, as a future EU member, is interested in the introduction of new and modern technology and the development of small and medium-sized enterprises. The previous day, the businessmen held talks with Economy Minister Aigars Kalvitis, Privatization Agency Director General Janis Naglis, Chamber of Commerce and Industry Director Viktors Kulbergs, Latvian Development Agency Director General Maris Elerts, and local businessmen. SG

CAR ASSEMBLY PLANT OPENED IN LITHUANIA

The Lithuanian Automobile Business Center and the Russian car maker GAZ have officially opened the first car assembly plant in the Baltic states in the northeastern Lithuanian city of Rokiskis, ELTA reported on 14 December. The joint venture will assemble Gazel and Sobol model automobiles and will create more than 100 jobs at the plant. Before the opening ceremony, GAZ President Nikolai Pugin met with Economy Minister Eugenijus Maldeikis and Prime Minister Rolandas Paksas, who welcomed the new joint venture. SG

POLISH PRESIDENT, PREMIER OPTIMISTIC ABOUT NEW U.S. PRESIDENT

"I am convinced that [U.S. President-elect George W. Bush] will continue the very active, friendly relations between Poland and the US... We have always been able to count on, and I am convinced that we will be able to count on, American support, goodwill, and friendship," PAP quoted President Aleksander Kwasniewski as saying on 14 December. "I think that we have four years of very good cooperation before us. Successive elections in recent years have not fundamentally changed the foreign policy of the United States, and that is the most important thing for us," Premier Jerzy Buzek commented. Both Kwasniewski and Buzek sent telegrams to Bush to congratulate him on his election victory. JM

CZECH PREMIER DENIES INTENTION TO DISMISS VETCHY

Prime Minister Milos Zeman described as "nonsense" reports that he is planning to dismiss Defense Minister Vladimir Vetchy, CTK reported on 15 December (see "RFE/RL Newsline," 14 December 2000). In other news, the Civic Democratic Alliance (ODA) on 14 December unanimously elected Michael Zantovsky as its candidate for leader of the Four-Party Coalition. That post is to be filled in January 2001. MS

PITHART LIKELY TO RETURN TO CZECH SENATE CHAIRMANSHIP

The two parliamentary groups representing the Four-Party Coalition in the Senate--the Christian Democrats and the Freedom Union/ODA groups--have elected Petr Pithart as their candidate for the post of Senate chairman, who will be elected on 19 December, CTK reported on 14 December. Pithart is also likely to be supported by two independent senators and may even receive the backing of the Social Democratic Party (CSSD), whose leader in the chamber said some of his party's colleagues consider Pithart to be "the most suitable candidate" for the post. Pithart was chairman between 1996 and 1998, and was then replaced by Civic Democratic Party (ODS) Deputy Chairwoman Libuse Benesova, following the "opposition agreement" between the CSSD and the ODS. Benesova failed to be re-elected to the Senate in November. MS

SLOVAK PRESIDENT SAYS KANIS SHOULD BE 'SUSPENDED'

Rudolf Schuster on 14 December said that Defense Minister Pavol Kanis should be "suspended" from his post until he clarifies how he is financing a luxury villa he is building near Bratislava, CTK reported (see "RFE/RL Newsline," 8 December 2000). Schuster, who spoke after a meeting with Prime Minister Mikulas Dzurinda, said he had proposed in a telephone conversation with Kanis that he withdraw from the cabinet until the matter is clarified, but Kanis refused. Dzurinda said that the coalition agreement stipulates that parties nominate their representatives to the cabinet and that it is up to the Party of the Democratic Left to decide the matter. MS

'MEIN KAMPF' TRANSLATION PUBLISHED IN SLOVAKIA

The first Slovak translation of Hitler's "Mein Kampf" has gone on sale in Slovakia, CTK reported on 14 December. Unlike the Czech version, whose publisher was recently sentenced for dissemination of racist views and propaganda (see "RFE/RL Newsline," 12 December 200), the Slovak translation is accompanied by a 30-page commentary by translator and psychologist Roman Vyskocil, who stresses the book's racist, anti-Semitic, and violent nature. Agnes Burdova, head of the ARA publishing house, has already asked a lawyer to defend her in the event that legal proceedings are launched. Vyskocil said he is "not worried" about being prosecuted, commenting that "I am too old and nobody will scare me." A total of 5,000 copies have been printed. The Slovak Jewish Community and Pal Csaky, deputy premier in charge of human rights, have strongly criticized the publication of the book. MS

EU ISSUES REPORT ON TISZA RIVER POLLUTION

An EU commission investigating the cyanide spill that occurred earlier this year at the Romanian Aurul company and polluted Hungary's Tisza River, blamed the incident on poor maintenance of the gold mine's reservoir. The commission's report concluded that, contrary to Romanian claims, it was not the extraordinarily adverse weather that caused the dam burst, "Magyar Hirlap" reported on 15 December. MSZ




NATO HOLDS SUSPECTED ALBANIAN GUERRILLAS...

KFOR peacekeepers on 14 December detained five ethnic Albanians near Gjilan on the suspicion that the men are members of the Liberation Army of Presevo, Medvedja, and Bujanovac (UCPMB). KFOR is checking whether 12 other ethnic Albanians riding in the same van are also guerrillas, Reuters reported. The Atlantic alliance has pledged to do all it can to keep UCPMB fighters from infiltrating into southern Serbia from Kosova. PM

...WARNS SERBIAN FORCES TO STAY OUT OF ZONE

U.S. Brigadier General Dennis E Hardy, who is the outgoing commander of peacekeepers in eastern Kosova, said that KFOR will not permit Serbian police or military to take control of the demilitarized buffer zone just inside Serbia's border with Kosova, "The New York Times" reported on 15 December. He stressed that ethnic Albanians in Kosova will retaliate against local Serbs if Serbian forces on the other side of the frontier enter the zone. Serbian opposition leader Zoran Djindjic and his deputy, Cedomir Jovanovic, warned recently that Serbian forces may soon enter the zone to expel the guerrillas if the UCPMB continues to attack Serbian policemen or soldiers from positions in the area. In Bujanovac, supporters of former Yugoslav President Slobodan Milosevic called on the Serbian authorities to "urgently solve the problem" posed to local Serbs by the presence of the fighters in the zone, AP reported. PM

NEW U.S. COMMANDER IN KOSOVA

Brigadier General Kenneth J. Quinlan took over command of U.S. forces in Kosova, at a ceremony at Fort Bondsteel in eastern Kosova on 15 December, AP reported. PM

PRESEVO ALBANIAN PARTIES NOT TO TAKE PART IN SERBIAN VOTE

Officials of the two main ethnic Albanian political parties in the Presevo region said in Pristina on 14 December that their parties will not take part in the 23 December Serbian elections, RFE/RL's South Slavic Service reported. Representatives of the Party for Democratic Work and the United Democratic Party of the Albanians said that the Serbia-wide electoral threshold of 5 percent makes it impossible for them to win any offices. PM

GREEK MINISTER SLAMS ALBANIAN 'TERRORISM'

Greek Defense Minister Akis Tsochatzopoulos said in Belgrade on 14 December that his government condemns "terrorist activity" by the UCPMB, AP reported. He also discussed a proposed "military and political agreement" between Belgrade and Athens with his Yugoslav counterpart, Slobodan Krapovic. The agreement would include the training of Yugoslav officers in Greece, as well as Greece's using its "good offices" to help Yugoslavia join NATO's Partnership for Peace Program, "Danas" reported. PM

EUROPEANS WONDER ABOUT WASHINGTON'S BALKAN PLANS

NATO foreign ministers agreed in Brussels on 14 December that the alliance's missions in Bosnia and Kosova are far from completed, RFE/RL's South Slavic Service reported. Ministers also noted that the new U.S. administration's plans for its role in the Balkans are not yet clear. Outgoing Secretary of State Madeleine Albright said that the recent democratic changes in Croatia, Serbia, and Kosova are a welcome opportunity but do not constitute a solution to the region's problems. In Rome, Romano Prodi, who heads the EU Commission, told "La Repubblica" that Europe must be prepared to assume further obligations for keeping peace in the Balkans if the administration of President-elect George W. Bush decides to withdraw U.S. forces. Prodi noted that Europeans already make up 80 percent of the foreign troops in the Balkans. And in Stockholm, Wolfgang Petritsch, who is the international community's high representative in Bosnia, said that he believes that the U.S. will re-examine its role in Bosnia but will not pull its forces out of that republic entirely. PM

KOSOVA SUPREME COURT BEGINS WORK

The Kosova Supreme Court held its first session in Prishtina on 14 December, RFE/RL's South Slavic Service reported. The court consists of 14 local and two foreign judges. The session marks the completion of the judicial reforms launched by the UN civilian authorities in the province in 1999. The court system is still plagued by a lack of qualified judges. PM

KOUCHNER: UN NOT TO ORGANIZE SERBIAN VOTE IN KOSOVA

Bernard Kouchner, who is the outgoing head of the UN civilian administration in Kosova, said in Prishtina on 14 December that the UN will not organize or monitor the Serbian elections there on 23 December. He added that the international community will do what it can to provide security for voters, Reuters reported. PM

SERBIAN COURT CONVICTS TEN FOR EXTORTION OF KOSOVARS

A Yugoslav army court in Nis on 14 December sentenced nine Serbian military policemen and one lawyer to prison terms totaling seven years for extorting money from Kosovar prisoners in their care. Five of the policemen and the lawyer received suspended sentences. The defendants charged prisoners fees for using mobile telephones and offered to secure them shorter sentences in return for cash payments. PM

EBRD ADMITS YUGOSLAVIA TO MEMBERSHIP

The European Bank for Reconstruction and Development has granted Yugoslavia membership, Reuters reported from Belgrade on 15 December. It is the first international financial organization to admit Belgrade following the fall of the former regime in October. The Yugoslav authorities are looking for a donor to pay the $15 million membership fee. PM

YUGOSLAVIA GETS NEW BANK NOTES

Mladjan Dinkic, who is governor of the National Bank, said in Belgrade on 14 December that the dinar is now fully convertible. He added that new coins and banknotes will soon be introduced into circulation to underscore the break he has made with Milosevic-era policies. Dinkic added that the Montenegrin authorities will have to decide for themselves if they want to introduce the new currency in their republic, where the German mark is legal tender. He said, however, that in Montenegro, there is "great interest" in the new currency, the Podgorica daily "Vijesti" reported. PM

NEW YUGOSLAV DEFENSE BODY SET UP

The Yugoslav government agreed in Belgrade on 14 December that Prime Minister Zoran Zizic will head a new Council on Defense and Security. A government spokesman added that the new civilian body will not interfere with the work of the mixed civilian and military Supreme Defense Council. The government also announced the recall of 17 ambassadors, including those stationed in Moscow, Prague, Brussels, Skopje, and Athens, RFE/RL's South Slavic Service reported. PM

YUGOSLAV BASKETBALL STAR DIES AFTER SHOOTING

Haris Brkic of the Partizan Belgrade basketball team died in hospital on 15 December after being shot in the head four days earlier by a man apparently trying to break into Brkic's car, AP reported. Criminal violence has become commonplace in Belgrade in recent years, but this is the first killing involving a prominent athlete. It is not known whether the assailant, who fled, knew that the car he sought to rob belonged to Brkic. PM

YUGOSLAVIA, BOSNIA ESTABLISH DIPLOMATIC TIES

Yugoslav Foreign Minister Goran Svilanovic and Bosnia's Jadranko Prlic signed documents in Belgrade on 15 December establishing full diplomatic relations between the two former Yugoslav republics, Reuters reported. PM

BOSNIAN SERB PARTIES FORM COALITION

The Serbian Democratic Party founded by Radovan Karadzic has reached an agreement on a coalition with the Party of Democratic Progress of Mladen Ivanic and two smaller parties. The coalition will have 49 out of the 83 seats in the parliament, AP reported on 14 December. PM

CROATIAN CHIEF OF STAFF TO TESTIFY TO HAGUE TRIBUNAL

General Petar Stipetic, who heads the General Staff, said in Zagreb on 14 December that he has been summoned to testify before the Hague-based war crimes tribunal about the 1995 Croatian army campaign against Serbian rebels (see "RFE/RL Newsline," 14 December 2000). Stipetic added that he will testify if the government authorizes him to do so. He said that if that is the case, he will "probably" testify before representatives of the tribunal in Croatia, "Jutarnji list" reported. PM

MASS GRAVE FOUND IN CROATIA

Croatian forensic experts said that they have found 18 bodies in a mass grave in Debelo Brdo in central Croatia. The experts added that they believe that the grave contains the remains of up to two dozen Serbian civilians killed during the 1991 war in the Gospic area, "Novi List" reported on 15 December. PM

ILIESCU CERTIFIED AS ROMANIAN PRESIDENT-ELECT

The Constitutional Court on 14 December certified Ion Iliescu as president-elect. Iliescu said the same day that the election process demonstrated that democratic forces "are united by things that are more important than the divisions among them." He said the elections also demonstrated that economic reforms must "respond to the expectations of the silent majority confronted with injustice" and that "there is a limit" to how much people can be expected to suffer. Iliescu is to be sworn in by the parliament later this month. MS

HUNGARIAN PARTY TO JOIN ROMANIAN OPPOSITION PACT?

Speaking after a meeting with the leadership of the Hungarian Democratic Federation of Romania (UDMR), Adrian Nastase, the likely head of the new government, said that the two sides agreed that many of their policy principles are "consensual." Next week, an agreement on "limited cooperation" in the parliament will be signed by his own Party of Social Democracy in Romania (PDSR) and the UDMR, the National Liberal Party and the Democratic Party. Separate agreements with each of these parties on "more specific issues of joint concern" will also be signed. Nastase announced that the name of the Department for National Minorities will "probably" be changed to "Department for Inter-Ethnic Relations" and that the body will be subordinated to the new Ministry for Public Information. Under the outgoing government, this department was subordinated to the premier and its head had ministerial rank. MS

MOLDOVAN CONSTITUTIONAL COURT SAYS PRESIDENTIAL MANDATE ENDS WITH SUCCESSOR'S ELECTION

The Constitutional Court on 14 December ruled that the mandate of an incumbent president ends on the day his successor is sworn in, Infotag reported. The court was asked by President Lucinschi to clarify the matter, while deputy Vladimir Slonari asked the court to determine whether the parliamentary speaker or the premier acts as president in the event that the presidency remains unfilled. The court said an acting president is appointed only if the incumbent president is incapable of performing his duties, resigns, is impeached, or dies in office. The ruling means that Lucinschi, whose mandate ends on 15 January 2001, will continue in office if a successor is not elected by the parliament at the end of the month. MS

MOLDOVAN GOVERNMENT THREATENS TO RESIGN

Prime Minister Dumitru Braghis has threatened that his government will have to resign and Moldova will have to declare bankruptcy, RFE/RL's Chisinau bureau reported on 14 December. Braghis spoke in the parliament after the legislature failed to approve an agreement between the government and the European Bank for Reconstruction and Development (EBRD) on handing over preferential shares to the EBRD in a company that has been unable to pay its restructuring debt to the bank. Braghis said approving the agreement is one of the conditions stipulated by the IMF to resume lending. The government is unable to pay pensions and salaries without renewed IMF funding, he warned. MS

MOLDOVAN DEPUTIES SUBMIT DRAFT ON OUTLAWING FASCIST, COMMUNIST PARTIES

A group of deputies form the Popular Party Christian Democratic on 13 December submitted an amendment to the law on political parties that would outlaw formations and political organizations "of fascist, Nazi, or communist orientation," Flux reported the next day. The draft also envisages prohibiting the display of fascist, Nazi, and communist symbols. The Party of Moldovan Communists (PCM) is the largest group in the parliament. On 14 December, PCM leader Vladimir Voronin declined to step down as presidential candidate and negotiate with the other parliamentary groups on a joint candidate, as proposed by parliamentary chairman Dumitru Diacov two days earlier. MS




HOW CLOSE IS A SETTLEMENT OF THE KARABAKH CONFLICT?


By Liz Fuller

The recent visit by the co-chairmen of the OSCE Minsk Group to Ankara, Yerevan, Stepanakert, and Baku has again raised hopes that a solution to the Karabakh conflict may be within reach. The co-chairs apparently hope that the promise of substantial economic benefits could induce the conflict parties to rethink their positions and show a greater readiness for compromise than they have done in the past. And the stopover of two of the three co-chairs in Ankara highlights the role envisaged by the international community for Turkey in providing economic assistance to both Armenia and Azerbaijan once a final peace agreement is reached.

The U.S. co-chair, Carey Cavanaugh, told journalists in Yerevan on 11 December after his meeting with Armenian President Robert Kocharian that "the impression we have now is that all conflicting parties want to move forward and get a concrete result as soon as possible." The previous day, Cavanaugh had lauded as "a wonderful idea" the recent pledge by both Kocharian and his Azerbaijani counterpart, Heidar Aliev, to try to reach a peace agreement before their respective terms in office end in 2003.

Notwithstanding Cavanaugh's optimism and the stated desire of the two presidents to hammer out a permanent settlement, there are serious obstacles to any steps forward. First, it remains unclear what form the final settlement might take. Armenia continues to favor the so-called "common state" model proposed by the Minsk Group in November 1998, which envisages horizontal relations between Azerbaijan and the unrecognized Nagorno-Karabakh Republic. Azerbaijan, however, rejects the "horizontal" in favor of the "vertical" model and is prepared to grant the disputed enclave only "the highest degree of autonomy" within Azerbaijan. Azerbaijani Foreign Minister Vilayat Guliev told Vienna's "Die Presse" earlier this month that any settlement is contingent on compromise by Armenia. Armenian Foreign Minister Vartan Oskanian, for his part, told the same newspaper that "as long as Azerbaijan insists Karabakh must remain under its control as an autonomous region, there will be no solution to the conflict."

True, the Russian Minsk Group co-chairman, Nikolai Gribkov, told journalists in Yerevan on 11 December that all four peace proposals offered by the Minsk Group since early 1997 remain on the table. Oskanian had suggested in July that it may prove possible to draft a new peace plan that combines elements of two or more of those proposals. He said that Yerevan would not rule out that approach provided that Karabakh's status is not pre-determined and the "package," rather than the "phased," approach is adopted.

Given that Stepanakert rejected the two "package" peace proposals offered by the Minsk Group in May and July 1997 and that Azerbaijan voiced serious reservations about those proposals, the most promising framework from which to select elements of a new composite peace plan is the September 1997 Minsk Group proposal. According to Gerard Libaridian, who served as adviser to former Armenian President Levon Ter-Petrossian, that proposal, though based on the "phased" rather than the "package" approach, was more acceptable than the two previous drafts to both Armenia and Karabakh insofar as it did not include a mention of either Azerbaijan's territorial integrity or of Karabakh's future status vis-a-vis Baku. In addition, it provided security guarantees for the enclave's population that were absent from the two earlier drafts. Azerbaijan formally signaled its acceptance of that draft in October 1997, while Armenia agreed to it "in principle" but "with reservations." But the Karabakh leadership, despite Yerevan's urging, rejected it.

Moreover, it is unclear who is to assume responsibility for crafting a new, composite draft peace plan. Aliyev has said that he considers that it is the Minsk Group's responsibility to do so. The co-chairs, in turn, have said that they do not intend to offer yet another draft peace proposal but that the OSCE will endorse any settlement that Aliyev and Kocharian agree to.

Nor is the peace plan itself the only bone of contention. Armenia and Azerbaijan also disagree over the participation of the Nagorno Karabakh leadership in the peace process. Armenian President Kocharian has consistently argued that the Azerbaijani leadership should conduct direct talks with Stepanakert. Meeting in Stepanakert on 11 December with the co-chairs, Nagorno Karabakh President Arkadii Ghukasian argued that Karabakh representatives should participate in the ongoing series of talks between Kocharian and Azerbaijan's President Aliev. But Guliev in his recent interview with "Die Presse" ruled out talks with what he termed "a puppet regime," arguing that "it was Armenia that supported and waged the war."

It could be argued that Baku's rejection of Stepanakert as a negotiating partner calls into question the sincerity of the Azerbaijani leadership's stated desire to resolve the conflict. But Baku's action could, however, reflect its concern that direct talks with the Karabakh leadership could trigger mass protests in Azerbaijan by the estimated 800,000 persons forced to flee their homes during the 1993 Armenian offensive, most of whom still live in appalling conditions in temporary housing.

The Armenian leadership, too, must contend with a domestic opposition that has repeatedly warned against "selling out" Karabakh. But Oskanian told "Die Presse" that in light of the "preparatory work" conducted by the two presidents during their meetings since July 1999, he hopes it may prove possible to reach a settlement in 2001.


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