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Newsline - December 18, 2003


COMMUNISTS THREATEN TO BOYCOTT MARCH PRESIDENTIAL RACE...
Communist Party leader Gennadii Zyuganov told reporters on 17 December that his party might tell its supporters to boycott the 14 March presidential election if votes from the 7 December State Duma elections are not recounted, Russian media reported. Zyuganov alleged that the Central Election Commission (TsIK) falsified 60,000 voting protocols, a number the party was able to determine because its monitors gathered 93 percent of all protocols from local polling stations across Russia (see "RFE/RL Newsline," 15 December 2003). The Communist Party is specifically demanding a recount by hand in the Bashkortostan, Tatarstan, Daghestan, Kabardino-Balkaria, and Mordovia republics and in Saratov, Amur, Orel, Rostov, Samara, and Penza oblasts. TsIK Chairman Aleksandr Veshnyakov responded to Zyuganov's charges by saying the claims "are evidence of the incompetence and political intrigues" of the Communist Party leadership, ITAR-TASS reported. The Communist Party's representative on the TsIK, Vadim Solovev, said the party will appeal to the European Court of Human Rights if the TsIK does not conduct a recount, according to RosBalt. The Communist Party will make a final decision about a boycott at a party plenary session to be held before the end of the month. JAC

...AS RIGHTIST PARTIES CONSIDER JOINING THEM
Yabloko Deputy Chairman Sergei Mitrokhin and Union of Rightist Forces (SPS) co-Chairwoman Irina Khakamada both told Ekho Moskvy on 17 December in separate interviews that their parties are considering joining the Communists in boycotting the 14 March presidential election. Mitrokhin said that, according to his party's calculations, Yabloko can confirm the Communist Party's information that "the biggest falsification" has been carried out, noting that "one does not sit down to play cards at the same table with a cardsharp the second time around." Yabloko leader Grigorii Yavlinskii, who ran for president in 1996 and 2000, confirmed the same day that he will not run in the presidential election. JAC

TAX MINISTRY TARGETS YUKOS-FINANCED FOUNDATION
Open Russia, the charitable foundation financed by oil giant Yukos, alleged on 17 December that the Tax Ministry is conducting probes of all the organizations that the foundation is funding, according to a statement posted on Open Russia's website (http://www.openrussia.info). Open Russia spokesman Maksim Dbar was quoted in the statement as saying the ministry's demand for "a huge number of documents" is seriously complicating the work of the foundation's partners, which include the VTsIOM polling agency, "Komsomolskaya pravda," the Video International advertising firm, the Moscow Helsinki Group and Memorial. Open Russia has allocated around 450 million rubles (approximately $15 million) for its programs this year. Foundation Director Aleksandr Osovtsov told Ekho Moskvy on 17 December that the checks constitute "a completely politically motivated and ordered-up attack on a social organization because its board chairman is [former Yukos CEO Mikhail] Khodorkovskii and its founders are connected to Yukos." JB

RUSSIA CRITICIZES U.S. PLAN FOR INTERIM IRAQI GOVERNMENT...
Deputy Foreign Minister Yurii Fedotov said on 17 December that a "broad political process" should be initiated in Iraq "in order to form an interim government representing all segments" of Iraqi society, Interfax reported. He said that the agreement reached by the U.S.-backed Coalition Provisional Authority and the Iraqi Governing Council in mid-November that maps out a timetable for returning sovereignty to the country "does not provide answers to many questions concerning the transfer of authority to the Iraqi people." Fedotov said the United Nations "can and must play a full-fledged role in Iraq" when a secure environment "allows it do so," and called for a "representative...conference, involving a wide range of foreign participants, including Iraq's neighbors." JB

...AND REITERATES A HARD LINE ON IRAQI DEBT
Deputy Foreign Minister Fedotov on 16 December stated that Iraq's $8 billion debt to Russia should be resolved "on the basis of the Paris Club mechanisms" -- a reference to the group of 19 leading creditor countries that deals with debt reduction for heavily indebted countries. Fedotov's comment "means that Moscow has no intention of forgiving Iraq's debts...as the United States is demanding, but is willing to reschedule the debt," "Kommersant-Daily" reported on 17 December. "Iraq is not the poorest country, and the Paris Club mechanisms incorporate a tried and tested set of measures for the rescheduling and easing of debtor countries' liabilities," the newspaper quoted Fedotov as saying. Former U.S. Secretary of State James Baker, who is President George W. Bush's special envoy dealing with Iraq's debt, is due to arrive in Moscow on 18 December for talks. Baker met on 16 December with French President Jacques Chirac and German Chancellor Gerhard Schroeder, after which the two leaders issued a joint statement with the United States calling for a significant reduction of Iraq's $120 billion debt. JB

RUSSIA, CHINA SIGN AGREEMENT FOR ARMS SALES IN 2004
Defense Minister Sergei Ivanov and his Chinese counterpart, Cao Gangchuan, have signed a working protocol on bilateral military-technical cooperation for 2004, ITAR-TASS reported on 17 December. The news agency quoted "an informed source in Russia's military industry" as saying the total value of the new and continuing contracts stipulated in the protocol for next year exceeds $2 billion, roughly the same figure as in the last several years. China is the biggest customer for Russian military hardware. The two defense ministers, who co-chair the Russian-Chinese intergovernmental commission on military-technical cooperation, held talks on 16 December. Afterward, Ivanov said that Sino-Russian relations are developing "positively" in "an atmosphere of trust" and "have a very important stabilizing effect" on the world situation. JB

THIEVES-IN-LAW PREFER MOSCOW
Gennadii Zakharov, deputy head of the investigations department of the Interior Ministry's Main Directorate for Combating Organized Crime (GUBOP), said on 16 December that the ministry has information on more than 1,000 so-called vory v zakone, or "thieves-in-law," as the godfathers of Russian organized crime are called, Interfax reported. More than 200 of them are under constant police surveillance, Zakharov said. Fifty thieves-in-law are in custody -- 38 of whom have been arrested this year alone -- for crimes including illegal arms and narcotics sales and using false documents. Another three are on the federal wanted list. The largest concentration of criminal bosses is in Moscow and Moscow Oblast, where up to 200 reside and control restaurants, retail markets, real estate, the narcotics trade, and prostitution. The second-largest concentration of thieves-in-law is in the southern regions of Krasnodar, Stavropol, and Rostov-na-Donu, where they control the hotel and resort sectors. Criminal bosses are increasingly trying to penetrate legal businesses and government structures, Zakharov said. JB

BOMB DEFUSED IN STAVROPOL CITY HALL
Federal Security Service (FSB) bomb-disposal experts on 17 December defused an explosive device that had been placed in the Stavropol city administration building, Interfax reported. According to a source in the regional emergency situations department, a bomb containing the equivalent of 900 grams of TNT, 3 kilograms of metal balls, and a battery -- suggesting that it was a radio-controlled device -- was found in the morning in the building's courtyard near the spot where the city's mayor and deputy mayor park their cars. The building was evacuated and bomb-disposal specialists called in. Stavropol Mayor Dmitrii Kuzmin told a press conference later in the day that the failed bombing was a response to the city administration's policy of reclaiming $10 million in municipal property that was "illegally privatized." Kuzmin said he and the deputy mayor have received a number of threatening phone calls. JB

FIRST SOVIET MILLIONAIRE BECOMES FIRST DECLARED PRESIDENTIAL CANDIDATE
Moscow coffin maker and well-known Soviet-era businessman German Sterligov announced on 16 December that he plans to run for president, Russian media reported. Sterligov ran in the 7 December Moscow mayoral election and in the 8 September Krasnoyarsk Krai gubernatorial election. According to "Vedomosti" on 17 December, Sterligov is running in order to gain publicity. JAC

BASHKIR PRESIDENTIAL CANDIDATE REPORTEDLY GIVING UP IN THE FACE OF KREMLIN OPPOSITION...
Citing a source close to the presidential administration, "Vedomosti" reported on 17 December that most of the campaign staff of Bashkir presidential candidate Sergei Veremeenko has returned to Moscow in the wake of Kremlin demonstrations of support for incumbent President Murtaza Rakhimov in the 21 December second-round presidential election in the republic. According to the source, President Vladimir Putin decided to back Rakhimov following an intense campaign by Rakhimov's Moscow-based "lobbyists," who reportedly threatened that Rakhimov's defeat would produce a "second Chechnya," and that Russian relations with Islamic states would become more complicated. A representative for Bashkortostan state television and radio told RosBalt that Veremeenko's representative failed to show up for an appointment or drop off any election materials to be broadcast during the candidate's free airtime. JAC

...AS GOVERNMENT MINISTER STUMPS FOR BASHKORTOSTAN INCUMBENT
Deputy Prime Minister Galina Karelova visited Ufa on 17 December to express her support for Bashkir President Rakhimov, one of RFE/RL's Ufa correspondents reported. An audience at Bashkortostan State University was surprised by Karelova's repeated praise of Tatarstan's program for construction of youth housing. She later said that she had meant to say Bashkortostan. JAC

UNIFIED RUSSIA TURNS ON ITS FORMER COMRADE...
Unified Russia leader and Interior Minister Boris Gryzlov announced on 17 December that his party is supporting deputy oblast administration head Yurii Osintsev in the 21 December mayoral race in Yekaterinburg, "Kommersant-Daily" reported on 18 December. Also on 17 December, the city's Unified Russia branch called on the oblast prosecutor to launch a criminal case against incumbent Yekaterinburg Mayor Arkadii Chernetskii for slander because he accused Osintsev of being connected with criminal groups. Chernetskii is a member of Unified Russia, according to the daily. Chernetskii received 34.2 percent of the votes in the 7 December first round, compared with 26.42 percent for Osintsev. According to the daily, Osintsev had only 6 percent support in polls conducted at the beginning of the campaign and was able to make such a strong showing only because of strong support from Sverdlovsk Oblast Governor Eduard Rossel and Unified Russia. The most recent polls show the two candidates running neck and neck. JAC

...AS KIROV CANDIDATE REPORTEDLY WANTS PRO-KREMLIN PARTY BACKING STRONGLY ENOUGH TO LIE ABOUT IT
Unified Russia on 17 December issued a statement saying that it is not backing businessman Oleg Valenchuk in the 21 December second-round gubernatorial election in Kirov Oblast, RosBalt reported. According to the party, Valenchuk illegally used the party's symbols in his campaign literature. Valenchuk was formerly the head of the party's regional branch, but was expelled for allegedly violating the party's charter. Incumbent Kirov Oblast Governor Vladimir Sergeenkov is ineligible to run again under oblast law, and Valenchuk is facing State Duma Deputy Nikolai Shaklein (Russian Regions) in the second-round poll. Shaklein won the first round with 33.8 percent of the vote, compared to 13.9 percent for Valenchuk, "Kommersant-Daily" reported on 9 December. Presidential envoy to the Volga Federal District Sergei Kirienko reportedly supported oblast legislature speaker Aleksandr Strelnikov in the first round. JAC

RUSSIANS SUGGEST DOSTOYEVSKY NO LONGER APPROPRIATE READING MATERIAL FOR HUSSEIN
Responding to news that deposed Iraqi President Saddam Hussein was reading Fyodor Dostoyevsky's classic 19th-century novel "Crime and Punishment" in his hovel before being captured by U.S. forces near Tikrit on 13 December, "Komsomolskaya pravda" on 17 December asked Russian politicians, entertainers, and writers what Hussein should be reading now? Writer Darya Dontsova suggested the Koran, while actor Mikhail Derzhavin proposed Mark Twain's "The Adventures of Huckleberry Finn" so that Hussein can better understand the U.S. citizens who will be managing the legal proceedings against him. Dmitrii Rogozin, a leader of the Motherland-Patriotic Union bloc, commented: "The Americans are so proud that they 'found' Hussein. But he wasn't 'lost' until the Americans seized the country of which he was president. The U.S. administration apparently doesn't want to remember that they went to Iraq to find and render harmless weapons of mass destruction, which Hussein, in their opinion, possessed. And now they show us not these weapons but Hussein with Dostoyevsky's novel." JAC

SPOKESMAN DENIES ARMENIAN PRESIDENT CRITICIZED JUNIOR COALITION PARTNERS
A spokesman for Armenian President Robert Kocharian rejected on 17 December allegations that during a 13 December emergency meeting with leaders of several political parties, Kocharian criticized "populist" statements by Orinats Yerkir and the Armenian Revolutionary Federation-Dashnaktsutiun, the junior partners in the three-party coalition government, and ordered those parties' leaders either to concentrate more on their shared responsibility for implementing reform or to "step aside," according to Mediamax, as cited by Groong. "Haykakan Zhamanak" reported on 16 December that Kocharian told the two parties "to stop their inappropriate populism and get down to serious business," while "Haykakan zhamanak" on 17 December said the president warned them to "stop playing games." LF

ARMENIA WELCOMES SWISS PARLIAMENT RECOGNITION OF 1915 GENOCIDE
In a written statement released on 17 December, Armenian Foreign Ministry spokesman Hamlet Gasparian said the Armenian leadership welcomes a resolution adopted the previous day by the Swiss parliament recognizing as genocide the killing of some 1.5 million Armenians in Ottoman Turkey in 1915, Noyan Tapan and RFE/RL's Yerevan bureau reported. The statement termed the Swiss resolution "a sign of justice toward the victims and the survivors," and a reminder that "there are no time limits on crimes against humanity." At the same time, it expressed the hope that the Swiss decision will not negatively affect recent diplomatic moves to normalize relations between Yerevan and Ankara. LF

ARMENIA STIFFENS PENALTIES FOR TAX EVASION
The Armenian parliament approved on 17 December a package of amendments aimed at increasing budget revenues in 2004 by imposing harsher penalties on companies suspected of tax evasion, Noyan Tapan and RFE/RL's Yerevan bureau reported. The amendments include the introduction of a 1 percent turnover tax for companies with a reported profitability rate of up to 5 percent. Profitability will be calculated on the basis of the ratio of the company's annual revenues to its aggregate assets. The Union of Manufacturers and Businesspeople has protested that the new ruling will unfairly penalize companies that have always paid their taxes in full, even when they operate at a loss. LF

ARMENIAN PARLIAMENT PASSES BILL ON ALTERNATIVE MILITARY SERVICE
Parliament passed on 17 December in its third and final reading a bill providing young Armenian men with an alternative to compulsory military service, RFE/RL's Yerevan bureau reported. Under pressure from the Council of Europe, the draft was amended to permit young men to perform civilian service; the original draft offered only the option of performing nonmilitary tasks in military units. The length of alternative military service remains unchanged at 42 months, compared with 24 months for regular military service. LF

AZERBAIJANI NGOS DEMAND RELEASE OF DETAINEES
In a joint statement released on 17 December, the Committee Against Election Falsification and the Committee to Protect Prisoners' Rights appealed to the Azerbaijani leadership to release 121 people who remain in detention for their alleged roles in the clashes between police and demonstrators in Baku on 15-16 October, Turan reported. The statement claimed the clashes were triggered by "provocateurs," and that opposition leaders tried to dissuade demonstrators from acting illegally or destroying property. Those still in pretrial detention include People's Party Chairman Panah Huseinov; Democratic Party of Azerbaijan General Secretary Sardar Djalaloglu; and Rauf Arifoglu, editor of the newspaper "Yeni Musavat." Huseinov's lawyer told Turan on 17 December that no investigation into his client's alleged crimes has been launched. Also on 17 December, a senior member of the Gyanja branch of the opposition Musavat Party was arrested for reasons that remain unclear, Turan reported. LF

AZERBAIJANI OFFICIAL SAYS MEDIA RECOMMENDATIONS UNNECESSARY
Presidential administration official Ali Hasanov has told Turan that the recommendations proposed to the Azerbaijani leadership with regard to the media following a visit to Azerbaijan earlier this month by a team from Reporters Without Borders (RSF) are unnecessary, Turan reported on 17 December (see "RFE/RL Newsline," 3 December 2003). Hasanov claimed that Baku has already fulfilled most of its media-related commitments to the Council of Europe, and that those still outstanding, including passage in its third and final reading of a draft law transforming state television into a public broadcaster, will be met by the end of this month. RSF recommended, among other things, that police who resorted to violence against journalists trying to report on the 15-16 October clashes be punished; that "Yeni Musavat" Editor Arifoglu be released on bail; and that insult laws be repealed and libel decriminalized. LF

CORRECTION:
A 16 December "RFE/RL Newsline" item entitled "...As Fellow Presidents Recall His Merits" erroneously identified former Georgian President Eduard Shevardnadze as the last surviving member of the Politburo of former Soviet leader Leonid Brezhnev.

GEORGIAN FOREIGN MINISTER HOLDS TALKS IN MOSCOW
Tedo Djaparidze flew on 16 December to Moscow from Baku, where he attended the funeral the previous day of former Azerbaijan President Heidar Aliyev, and met on 17 December with Russian First Deputy Foreign Minister Valerii Loshchinin to discuss a range of issues relating to bilateral relations, Russian and Georgian media reported. Djaparidze characterized the talks as "positive," stressing at the same time that pragmatism rather than emotions should determine the course of bilateral relations. He noted that the two sides have still not agreed on the text of a framework treaty on bilateral relations. Djaparidze also said he has informed the Kremlin of Tbilisi's wish to schedule a visit to Moscow by acting President Nino Burdjanadze for next week. In an interview published in "Izvestiya" on 17 December, Djaparidze said he has presented the Russian Foreign Ministry with a written acknowledgment that Tbilisi was at fault in allowing self-exiled Russian oligarch Boris Berezovskii to visit Tbilisi earlier this month using a British passport with another name (see "RFE/RL Newsline," 4 December 2003). LF

'SABOTAGE GROUP' ARRESTED IN GEORGIA
Georgian security services have arrested three members of a sabotage group, including a Defense Ministry colonel, and confiscated large quantities of explosives and detonators from them, Caucasus Press reported on 17 December. Also on 17 December, the Georgian Interior Ministry announced the discovery in a church in the Pankisi Gorge of a large quantity of armaments including ground-to-air missiles. Meeting on 17 December at the Defense Ministry with the heads of law enforcement agencies, acting President Burdjanadze expressed concern at the inability of various "force" ministries to coordinate their work, Caucasus Press reported. She said the National Command Center established 18 months ago within the framework of the U.S.-funded "Train and Equip" program should begin functioning immediately. She said its primary function will be to develop a response in the event of violations of Georgia's territorial integrity or attacks on senior officials, Interfax reported. LF

U.S. AMBASSADOR FAILS TO REACH AGREEMENT WITH ADJAR LEADER
U.S. Ambassador to Tbilisi Richard Miles met in Batumi on 17 December for three hours with Adjar Supreme Council Chairman Aslan Abashidze, but failed to persuade him to drop his opposition to the holding of extraordinary presidential elections on 4 January, Georgian media reported. Abashidze has consistently argued that the ballot, and the repeat parliamentary elections, should be postponed for several months. He has also reportedly demanded guarantees from the interim Georgian leadership that the election outcome will not be falsified, according to Caucasus Press on 17 December. LF

GEORGIAN SOCCER FEDERATION HEAD DENIED PRE-TRIAL BAIL
The Tbilisi Municipal Court upheld on 18 December the 13 December refusal by a district court to grant bail to Georgian Soccer Federation Chairman Merab Zhordania, who was arrested on 12 December on charges of tax evasion, Caucasus Press reported (see "RFE/RL Newsline," 15 December 2003). Meanwhile, the prosecution has disclosed that it has received information that Zhordania has some $4 million in Swiss bank accounts. Interior Minister Giorgi Baramidze welcomed the 18 December Municipal Court decision, saying that "embezzlers" such as Zhordania should be kept in custody until they have repaid every tetri (cent) they stole, Caucasus Pres reported. LF

PRESSURE MOUNTS FOR ABKHAZ OFFICIAL TO RESIGN
Some 10,000 people have signed a petition calling on Tamaz Nadareishvili, chairman of the Tbilisi-based Abkhaz parliament in exile, to resign before the 4 January presidential election, Caucasus Pres reported on 17 December. Calls for Nadareishvili's resignation began immediately following the ouster of former Georgian President Eduard Shevardnadze (see "RFE/RL Newsline," 25 and 26 November 2003). A spokesman for an umbrella body that groups together organizations representing the interests of Georgian displaced persons who fled Abkhazia during the 1992-93 war said he is concerned that Nadareishvili might try to flee the country, since he has reportedly asked the Finance Ministry in exile to give him 7,000 euros ($8,689) for medical treatment abroad. The spokesman appealed to the Georgian Border Protection Service not to permit Nadareishvili to leave Georgia. LF

KAZAKHSTAN, TAJIKISTAN REPORT GROWTH IN INDUSTRIAL OUTPUT
Kazakhstan's State Statistics Agency has reported that industrial output in the country rose 8.3 percent in the first 11 months of 2003 compared with the same period in 2002, RIA-Novosti reported on 16 December. According to the agency, mining increased 8.1 percent; output of refining industries rose 8.7 percent; and production and distribution of electric power, gas, and drinking water rose 6.9 percent. Tajikistan's State Statistics Committee reported that in the first 11 months of this year, the country's industrial output increased 9 percent compared with the same period in 2002. Production of consumer goods rose 13.5 percent, and real incomes rose 27 percent. Both reports were carried by RIA-Novosti on 16 December. BB

BISHKEK MAYOR'S OFFICE GOES BILINGUAL
The Bishkek mayor's office formally introduced the requirement on 15 December that all official documents must appear in both the Kyrgyz and Russian languages, akipress.org reported on 16 December. A special section is being set up in the office to ensure that the Kyrgyz versions of all documents are grammatically and stylistically correct. The instruction accords with a draft law on the state language that the Kyrgyz parliament has been discussing since November. One of the provisions of the law is that all officials should be able to conduct business in the state language, Kyrgyz, by 2005. Russian, in contrast, has the status of an official language. According to an article that appeared on the "Gazeta SNG" website (http://www.gazetasng.ru) on 16 December, a test of the Kyrgyz-language skills of the staff in the mayor's office revealed that even ethnic Kyrgyz lacked satisfactory competence. The Bishkek mayor's office was taken as indicative of the poor Kyrgyz-language skills of many government officials. BB

KYRGYZ CONSUMER-PROTECTION COUNCIL HOLDS FIRST MEETING
Kyrgyzstan's new Coordination Council on Consumer Protection held its first meeting on 17 December, kabar.kg reported. Prime Minister Nikolai Tanaev, who chairs the council, said the country needs a consumer-protection body to ensure the quality of goods and services being offered to the public, and also because Kyrgyzstan has made a commitment to bring its legislation into line with that of the European Union. The council includes government officials and members of public organizations dealing with consumer protection, and Tanaev called for the active assistance of the public as well. Among the issues raised at the first meeting were the drafting of model contracts for technical services in apartment buildings and for electricity supplies, as well as the approval of a council work plan for 2004. That plan calls for the council to concentrate initially on consumer protection in the retail sector. BB

KYRGYZ PRESIDENT ASSERTS PRIORITY OF SERVICE SECTOR
Speaking to Kyrgyzstan's International Business Council in Bishkek on 17 December, Kyrgyz President Askar Akaev said that the development of private business and the service sector are priorities for the country, Interfax reported. He envisaged a competitive private sector as the main engine of economic growth. Akaev called for Kyrgyzstan to become the services center of the Central Asian region, adding that the service sector should dominate the country's economy. The information-technology and telecommunications industries should be the means of Kyrgyzstan's integration into the world community. Akaev also called for an end to state interference with private business and for the improvement of the tax and export regimes. BB

BORDER-GUARD TRAINING CENTER OPENS IN TAJIKISTAN
A training center for Tajik border guards opened in Dushanbe on 17 December, Asia Plus-Blitz and ITAR-TASS reported. The center was set up in cooperation with the International Organization for Migration (IOM) and funded by the U.S. State Department. Trainees at the center will learn computer skills and study English. The same day, Lieutenant General Nuralisho Nazarov, first deputy chairman of the Tajik State Border Protection Committee, told ITAR-TASS that the committee's command center is ready to take over responsibility for all checkpoints on the Tajik-Afghan border that are presently manned by Russian border guards. Nazarov angered Russian military officials and parliamentarians earlier this year when he made a similar assertion (see "RFE/RL Newsline," 22 September 2003). This time he emphasized that the Russian border troops have been a great help to Tajikistan, particularly during the 1992-97 civil war and in training Tajik border personnel. He denied that Tajikistan is demanding the withdrawal of the Russian troops. BB

UZBEK PRESIDENT APPOINTS NEW GOVERNOR OF SAMARKAND OBLAST
Islam Karimov met with the Samarkand Oblast Council of People's Deputies on 16 December to ask for approval of his choice of Samarkand State University Rector Rustam Kholmurodov for the post of oblast governor, uzreport.com and UzA reported the following day. The council confirmed the appointment of Kholmuradov to succeed Shavkat Mirzayoev, who was appointed prime minister on 11 December (see "RFE/RL Newsline," 12 December 2003). After praising Mirzayoev's successes in improving the oblast's agriculture and summarizing the general decline in Uzbek agriculture in recent years, Karimov told the new governor that he must emphasize the education, health, and municipal-services spheres, as well as deal with the problem of employment. BB

PACE RAPPORTEUR SUGGESTS OFFICIAL INVOLVEMENT IN BELARUSIAN DISAPPEARANCES
Cypriot lawmaker Christos Pourgourides, a Parliamentary Assembly of the Council of Europe (PACE) rapporteur on high-profile disappearances in Belarus, has made public his preliminary report on the disappearances of Yury Zakharanka (7 May 1999), Viktar Hanchar and Anatol Krasouski (16 December 1999), and Dzmitry Zavadski (7 July 2000), RFE/RL's Belarusian Service reported on 17 December. Pourgourides based the report on findings during his visit to Minsk on 5-8 November. "The interviews I conducted in Minsk...have led me to believe that steps were taken at the highest level of the state actively to cover up the true background of the disappearances, and to suspect that senior officials of the state may themselves be involved in these disappearances," Pourgourides wrote. The PACE rapporteur believes that former Security Council Secretary Viktar Sheyman (now prosecutor-general) and former Interior Minister Yury Sivakou (now minister of sports) may have been implicated in orchestrating the disappearances. Pourgourides urges member states of the Council of Europe to apply "maximum political pressure" on the Belarusian leadership, including "sanctions," to force a credible independent investigation of the disappearances and the alleged involvement of high-ranking officials in them. JM

UKRAINIAN PRESIDENT URGES WASHINGTON TO SPONSOR REPROCESSING OF ROCKET FUEL
Ukrainian President Leonid Kuchma has sent a letter to his U.S. counterpart George W. Bush urging him to resume funding for a program of reprocessing of solid fuel for SS-24 ballistic missiles, Interfax reported on 17 December, quoting the Ukrainian president's press service. Kuchma said some 5,000 tons of such fuel is being kept at a chemical plant in Pavlovhrad. The Ukrainian president recalled that Washington obliged itself to help Ukraine rid itself of its store of rocket fuel under two 1993 agreements relating to the liquidation of nuclear weapons in Ukraine. JM

OUR UKRAINE COLLECTS SIGNATURES SUPPORTING DIRECT PRESIDENTIAL BALLOT
Our Ukraine leader Viktor Yushchenko told journalists on 17 December that his bloc has already collected some 3.5 million of the planned 8 million signatures under a petition asking parliament not to amend the constitutional provision stipulating that the Ukrainian president should be elected in a nationwide election, Interfax reported. The Verkhovna Rada is expected next week to consider two drafts of constitutional reform that provide for the election of the president by parliament (see "RFE/RL Newsline," 12 December 2003). Yushchenko said he is confident that the Verkhovna Rada will not abolish direct presidential elections in Ukraine. "I'm sure that if the people are deprived of their constitutional right of choice, they will take to the streets.... But we will defend the constitution and the people's right to elect [the president]," Yushchenko said. JM

UKRAINE'S NEW PROSECUTOR-GENERAL REPORTS NO PROGRESS IN GONGADZE CASE
Prosecutor-General Hennadiy Vasilyev told journalists on 17 December that investigators have not solved the homicide of Internet journalist Heorhiy Gongadze in 2000 and have no suspects in the case, Interfax reported. Vasilyev said the announcement by former Prosecutor-General Svyatoslav Piskun that the Gongadze case would soon be solved was unfounded. Piskun said in September that prosecutors concluded an investigation into the Gongadze slaying and placed three suspects on a search list, but he declined to reveal their identities (see "RFE/RL Newsline," 4 September 2003). President Kuchma replaced Piskun with Vasilyev in November (see "RFE/RL Newsline," 3 November 2003). JM

ESTONIAN LAWMAKERS PASS 2004 STATE BUDGET
Parliament approved the 2004 state budget by a vote of 61 to 27 with five abstentions on 17 December, BNS reported. The ruling coalition of Res Publica, the Reform Party, and People's Union was backed by the opposition Moderates in the budget vote, while the Pro Patria Union abstained. The budget, which assumes 5-6 percent economic growth and 3.8 percent inflation, foresees revenues of 47.62 billion kroons ($3.76 billion) and expenditures of 47.69 billion kroons. Those revenue figures are 20 percent higher than the 39.55 billion kroons in the 2003 budget, primarily due to 5 billion kroons in expected foreign aid. Lawmakers also passed an income-tax-reform plan that raises the monthly tax-exempt figure from the current 1,000 kroons to 1,400 kroons in 2004, 1,700 kroons in 2005, and 2,000 kroons in 2006. The personal-income-tax rate will decrease from the current 26 percent to 24 percent in 2005, 22 percent in 2006, and 20 percent in 2007. SG

LITHUANIAN GOVERNMENT APPROVES SALE OF POWER NETWORK
The Lithuanian government formally approved a draft agreement on 17 December on the sale of a majority stake in Vakaru Skirstomieji Tinklai (Western Distribution Network, or VST) to NDX, a consortium of nine wealthy Lithuanians who also control stakes in retail conglomerate Vilniaus Prekyba Market, "Lietuvos rytas" reported the next day. NDX agreed to pay almost 540 million litas ($193 million), or nearly 1.73 litas per share, for a 77 percent stake in VST. It also pledged to invest another 420 million litas in the company in the next five years. The deal would represent the second-largest privatization deal in Lithuania's history, exceeded only by the sale of the telecommunications company Lietuvos Telekomas. The privatization of the Eastern Distribution Network (RST), for which state-owned Estonian Energy bid 520 million litas, has been postponed until the privatization of VST can be evaluated. SG

POLISH MINISTER DISMISSES FINANCIAL ARGUMENTS IN EU-CONSTITUTION DISPUTE
Polish Foreign Minister Wlodzimierz Cimoszewicz said on 17 December that he does not view a letter signed by the representatives of six EU countries postulating a freeze on EU budgetary spending in 2007-13 as an "element of blackmail" intended to pressure Poland and Spain into accepting the EU draft constitution prepared by the European Convention, PAP reported. "[The letter] is a very ironical commentary for, among others, [German] Chancellor Gerhard Schroeder's proposal to hold a discussion about what is more important -- the union or national interests," Cimoszewicz noted. He said Poland should not be afraid that financial arguments might prove an effective instrument in the debate about the EU constitution. "This is the worst, or simply the stupidest, way of conducting a European debate, and I deeply believe that it will not proceed [in that manner]," Cimoszewicz opined. JM

POLISH GOVERNMENT LAUNCHES PROMOTIONAL WEBSITE
The Polish Foreign Ministry launched a new Polish promotional website on 17 December, PAP reported. The "Polish Panorama" website is available in five languages -- Polish, English, French, German, and Spanish -- and can be found at the following addresses: http://www.poland.gov.pl, http://www.pologne.gov.pl, http://www.polen.gov.pl, http://www.polonia.gov.pl. JM

CZECHS OPT TO LEASE GRIPEN FIGHTER JETS
The Czech cabinet granted exclusivity to the Swedish government on 17 December over the lease of 14 Swedish/British-made Jas-39 Gripen supersonic fighters, CTK and international news agencies reported. The decision allows the cash-strapped state to delay the purchase of jets to replace its fleet of aging Soviet-made MiG fighters. Prime Minister Vladimir Spidla said the government is following the recommendation offered by a Defense Ministry team earlier this month, although reports at the time suggested the immediate purchase of jets (see "RFE/RL Newsline," 2 December 2003). The ministers of defense, finance, industry and trade, and foreign relations are to negotiate the details of the contract with the Swedish government by the end of February, after which the government will vote on whether or not to finalize the offer. Citing earlier reports, AP said the Gripen fighters will be leased for five years, after which Prague will decide whether to extend the lease, buy the planes, or return them to Sweden. MS/AH

CZECH SENATE APPROVES FOREIGN MILITARY MISSIONS, LOWER HOUSE POSTPONES VOTE
The upper house on 17 December approved the extension of Czech military participation in missions in the Balkans and in Iraq in 2004, CTK reported. Five hundred Czech soldiers are in the Balkans, and a contingent of 150 military police serves in Iraq. The lower house postponed its vote to 18 December due to procedural disputes among opposition and coalition deputies. MS

CZECH PREMIER CRITICIZES DOUBLE STANDARD IN EU
Prime Minister Spidla said on 17 December that the recent failure of current and future EU leaders to agree on a draft European constitution is far less worrisome than the fact that the union has allowed Germany and France to escape sanctions for breaking fiscal commitments under the Stability Pact, CTK reported. In an interview with the German-language weekly "Prager Zeitung," Spidla noted that the EU slapped sanctions on Lisbon when Portugal exceeded the limit on the state budget deficit, while Germany and France have been spared any fine. Spidla added that he considers it "dangerous" that as a result of the failure of negotiations on the EU constitution, a "dual track" appears to have emerged regarding integration. "My idea of a united Europe is of a single speed and effective integration," Spidla said. MS

SLOVAK GOVERNMENT WILL REINFORCE MISSION IN IRAQ
The government on 17 December approved the deployment of 25 additional soldiers to Iraq, CTK reported. As a result, 102 Slovak soldiers will be stationed in Iraq under the U.S.-led occupation of that country. Most of the additional troops will be in charge of protecting the 82 engineering specialists who are serving in the sector that is under Polish command. MS

CABINET AGREES TO ASSUME SLOVAK TELEVISION DEBT
Cabinet ministers agreed on 17 December to take over most of Slovak Television's debt, CTK reported. As a result, the state-owned broadcaster's debt is likely to drop by some 400 million crowns (over $12 million) to 180 million crowns. Slovak Television underwent massive staff reductions this year in an attempt to cope with the company's debt. It is expected to turn its first profit in 2003, of some 85 million crowns, after losses of over 410 million crowns in 2002. MS

HUNGARIAN MTV HEAD RESIGNS AMID NEW SCANDAL
Hungarian Television (MTV) President Imre Ragats resigned his post on 17 December, citing health reasons, "Nepszabadsag" reported. The daily alleges, however, that Ragats resigned after it was discovered that he was involved in MTV's purchase of a 10-year-old nature-film series from Ragats's stepdaughter. Ragats agreed to buy the series in late July for 55 million forints ($255,000), which the daily reported was as much as four times the going rate. The MTV board of trustees initiated Ragats's dismissal on 11 November after learning that he had quietly concluded a dubious agreement on the sale of MTV airtime. The trustees' decision has not been approved by the MTV supervisory board, which includes representatives of nongovernmental organizations (see "RFE/RL Newsline," 12 and 21 November 2003). MSZ

HUNGARIAN OPPOSITION PARTY BACKS TRANSYLVANIAN AUTONOMY
Opposition FIDESZ party Chairman Viktor Orban told reporters on 17 December that his party wants to build a friendly long-term relationship with the National Council of Transylvanian Hungarians (EMNT in Hungarian, CNMT in Romanian), which was set up in the Romanian city of Cluj-Napoca on 13 December, "Magyar Nemzet" reported. The council was set up by radical leaders of the Hungarian minority in Romania to strive for the autonomy of ethnic Hungarians (see "RFE/RL Newsline," 15, 16, and 17 December 2003 and Romania item, below). Orban received EMNT leaders in Budapest, including the council's chairman, Calvinist Bishop Laszlo Tokes, and told them that FIDESZ advocates European-style autonomy. "We support Transylvanian autonomy, which we consider a national cause that can be sincerely espoused," Orban said, according to "Nepszabadsag." "The autonomy enjoyed by Germans in Belgium, Swedes in Finland, and Catalans in Spain shows that there is room in the EU for communities of national minorities," he added. MSZ

ETHNIC HUNGARIANS IN VOJVODINA AGAIN DEMAND DUAL CITIZENSHIP
Leaders of ethnic Hungarian parties from Serbia and Montenegro's province of Vojvodina presented a petition to Hungarian government officials in Budapest on 17 December with 50,000 signatures in favor of granting Hungarian citizenship to ethnic Hungarians abroad. Andras Agoston, chairman of the Democratic Party of Hungarians in Vojvodina, told reporters that Hungary's EU accession in May will create the conditions for granting dual citizenship to Hungarians abroad, Hungarian radio reported. Meanwhile, the citizenship committee of the Hungarian Standing Conference (MAERT), comprising representatives of Hungarian parties from Hungary and abroad, agreed the same day in Budapest that full Hungarian citizenship should be guaranteed for all ethnic Hungarians requesting it, the MTI news agency reported. MSZ

CROATIAN PRIVATE TELEVISION OWNER SHOT
An unknown gunman shot Ivan Caleta in the legs in Zagreb on 17 December, dpa reported. A police spokeswoman said that, had he wanted to do so, the gunman could have killed Caleta, who heads Croatia's only nationwide commercial television station, Nova TV. The Organization for Security and Cooperation in Europe (OSCE) said in a statement that it "believes that any such threats to media professionals, publishers, and journalists have a chilling effect on the work of journalists, especially those involved in investigative work and reporting on corruption. The OSCE mission expects a swift and thorough investigation to bring perpetrators to justice and inform the public about the outcome." PM

U.S. AMBASSADOR TO BOSNIA WARNS OF TERRORIST THREAT
U.S. Ambassador to Bosnia Clifford Bond said in Banja Luka on 17 December that there is a terrorist threat in that country because of foreigners who arrived there during the 1992-95 conflict and stayed on, RFE/RL's South Slavic and Albanian Languages Service reported (see "RFE/RL Newsline," 17 December 2003). He stressed that the United States is determined to help Bosnia improve its ability to fight terrorism. Bond warned that Bosnia will remain on the margins of Europe so long as indicted war criminals Radovan Karadzic and General Ratko Mladic remain at large, "Dnevni avaz" reported. The ambassador stressed that Bosnia needs a single and integrated intelligence agency to fight terrorism and organized crime. PM

RESERVATIONS IN THE UN ON KOSOVA STANDARDS PACKAGE...
Although the UN Security Council recently endorsed the "Standards for Kosovo" program put forward by Harri Holkeri, who heads the UN civilian administration in Kosova, some UN officials indicated on 17 December that they are in no hurry to move toward status talks, RFE/RL reported (see "RFE/RL Newsline," 11 and 15 December 2003 and "RFE/RL Balkan Report," 1 August and 17 October 2003). "It is clear that there is no deadline [for status talks] and that the future status process will not start automatically on the review date [in mid-2005]," UN Undersecretary-General for Peacekeeping Jean-Marie Guehenno said. "A prerequisite for any discussion on Kosovo's future status remains achievement of the eight standards." German Ambassador to the UN Gunter Pleuger argued that "the implementation of the standards will be closely linked with the EU association process, and conversely, obstruction of efforts to meet the standards will surely have serious consequences for aspirations to draw closer to Europe." PM

...AS SERBS REPEAT THEIR OBJECTIONS
Speaking at the UN on 17 December, Serbia and Montenegro's Ambassador to the UN Dejan Sahovic said his government supports in principle the concept of "standards before status," RFE/RL reported. He added, however, that Belgrade feels that Holkeri's plan does not go far enough in defining proper standards for establishing a "multiethnic" Kosova. Holkeri's plan is backed by the province's more than 90 percent ethnic Albanian majority and by the Turkish, Bosnian Muslim, and Romany minorities. Many observers believe that Belgrade and the local Serbian minority oppose the plan because they fear that any discussion of status will lead to independence, and hence prefer to use delaying tactics. PM

SERBIAN REFORMISTS SHUN ULTRANATIONALISTS
The governing Democratic Party announced in Belgrade on 17 December that they will not agree to any postelection coalition with Vojislav Seselj's ultranationalist Serbian Radical Party (SRS), which has led some recent public-opinion polls for the 28 December parliamentary elections, RFE/RL's South Slavic and Albanian Languages Service reported (see "RFE/RL Balkan Report," 12 December 2003). The pro-reform G-17 Plus political party and the Together for Tolerance (ZZT) coalition recently made similar declarations in response to an appeal by Serbia's Federation of Nongovernmental Organizations (FENS). In related news, "Vesti" reported on 17 December that an important reason for EU foreign- and security-policy chief Javier Solana's recent visit to Belgrade was to warn former Yugoslav President Vojislav Kostunica and his Democratic Party of Serbia (DSS) against forming any coalition with the SRS (see "RFE/RL Newsline," 16 December 2003). The DSS has finished just behind the SRS in some recent opinion polls. PM

REFERENDUM AGAINST DECENTRALIZATION PLANS ANNOUNCED IN MACEDONIAN TOWNS
The town council in Struga on Lake Ohrid decided on 17 December to hold a referendum on 11 January to protest government plans to redraw the borders of the Struga administrative district, "Utrinski vesnik" reported. The councilors object to the fact that the reform will create an ethnic Albanian majority in the district. On 4 January, a similar referendum will be held in Rostuse, and it is likely that more such votes will follow elsewhere. Administrative redistricting is an important part of the government's efforts to decentralize the state administration (see "RFE/RL Newsline," 14 October, 13 November, and 12 December 2003 and "RFE/RL Balkan Report," 21 February 2003). UB

RECIDIVIST ROMANIAN MINERS' LEADER SENTENCED AGAIN
Miners' leader Miron Cozma was sentenced on 17 December to seven years in prison for his role in the 1999 clashes at Stoenesti-Olt, Mediafax reported. Cozma was found guilty of "instigation" and of "contempt of a judicial decision." Three of his associates were sentenced to terms of between four and 5 1/2 years in prison. On learning of his 18-year jail sentence in 1999 for his 1991 role in the fall of the Petre Roman government, Cozma surrounded himself with miners to try to prevent his arrest. Some 2,500 miners clashed with police at Stoenesti-Olt, where they erected a barricade and hurled stones at police. On 12 December, Cozma was sentenced to a 10-year term for his role in the Costesti clashes of 1999 (see "RFE/RL Newsline," 15 December 2003). MS

ROMANIAN PREMIER ISSUES BLUNT WARNING TO ETHNIC HUNGARIAN GROUP...
Prime Minister Adrian Nastase suggested on 17 December that Romanian authorities will pursue legal action against the ethnic Hungarian Szeklers National Council (CNS) if that council contravenes the Romanian Constitution, Mediafax reported. It is difficult to intervene as long as the CNS remains a forum for debate, Nastase said, but intervention is permissible if the CNS tries to implement those ideas. The CNS was established in October and has demanded territorial autonomy for the lands historically inhabited by the Szeklers, a group within the Hungarian national minority in Romania (see "RFE/RL Newsline," 26 October 2003). A CNS delegation met with the leadership of the Hungarian Democratic Federation of Romania (UDMR) on 17 December and requested UDMR support for the autonomy demand. UDMR Senator Attila Verestoy and UDMR parliamentary deputy Attila Kelemen said they will examine the CNS-elaborated "Autonomy Statute" and express an opinion at a later date. MS

...AS ROMANIAN PROSECUTORS LAUNCH INVESTIGATION INTO ANOTHER ETHNIC HUNGARIAN GROUP
Romanian Interior Minister Ioan Rus said on 17 December that prosecutors in Cluj-Napoca have launched an investigation into the legality of the recently established National Council of Transylvanian Hungarians (CNMT), Mediafax reported (see "RFE/RL Newsline," 15 December 2003). The CNMT wants autonomy for all members of the Hungarian minority in Romania, as well as for territories where ethnic Hungarians are in majority. MS

WILL ISRAELI COMPANY MANAGE ELECTION CAMPAIGN FOR ANTI-SEMITIC ROMANIAN PARTY?
The daily "Romania Libera" reported on 17 December that Israel's Arad Communications, which managed Israeli Prime Minister Ariel Sharon's successful campaign in 2002, has denied that it agreed to manage the Greater Romania Party's (PRM) 2004 election campaign. Next to the denial, the daily reproduced a copy of a contract that was purportedly signed in Arad's name by an Israeli resident of Romania. "Romania libera" also reported that the Bucharest-based Center for Monitoring and Combating Anti-Semitism in Romania (CMCAS) has written a protest letter to Arad owner Ayal Arad. In the letter, the CMCAS points out that the PRM is led by Corneliu Vadim Tudor, who it says "for 14 years has been expressing strong xenophobic, anti-Semitic, and racist opinions" and denies that the Holocaust occurred. CMCAS Director Marco Maximillian Katz said the Israeli company has responded evasively to the protest. "RFE/RL Newsline" has learned that protests were also sent to Arad by the International League Against Racism and Anti-Semitism in Romania, the Federation of Jewish Communities, and Israeli scholars. The daily "Evenimentul zilei" reported on 18 December that Israeli Knesset Deputy Colette Avital also sent a letter of protest to Arad. MS

MOLDOVAN COMMUNIST SAYS 'DE-MOLDOVIZATION' MUST CEASE...
Victor Stepaniuc, leader of parliamentary group of the Party of Moldovan Communists (PCM), said on 17 December that the nationalities-policy concept recently approved in its first reading by the legislature is a "good document" that might be approved in its final reading as early as this week, Flux reported (see "RFE/RL Newsline," 15 December 2003). Stepaniuc said the concept is directed at providing a legal instrument that would help end "the process of de-Moldovization, violent assimilation, and illegal methods" applied by parties claiming to represent the Romanian minority. He called those purported methods "a spiritual genocide" directed against Moldovans. For the first time in Moldova's history, Stepaniuc said, the document recognizes the existence in Moldova of a Romanian minority. That minority, he added, "monopolized spiritual life in our country" after 1990, introducing "Romanian history" and "Romanian language" into school curriculums. He said those courses were previously taught "only when Moldova was under Romanian occupation between 1918 and 1940." Stepaniuc said every country, including Moldova, has the right to defend "the ethos of the majority." MS

...WHILE ROMANIAN PRESIDENT WARNS OF 'STALINIST REVIVAL' IN MOLDOVAN POLICIES
In an interview with Romanian radio on 17 December, President Ion Iliescu said he is "concerned" that the PCM is resurrecting "Stalinist theses" in Moldova on national questions that were believed to have been shelved long ago. Iliescu said these concepts are "very dangerous for the fate of that country and its people." It is "an insult," he said, when the ethnic majority in Moldova is called a "national minority" by the PCM. He also said that to speak "about a Moldovan language is to distort historical reality, as well as current cultural and social realities. When [Josef] Stalin made up such concepts, he was planning territorial expansionism; but one cannot help wondering what is driving the PCM leadership to resurrect them," Iliescu said. MS

CHISINAU DEMONSTRATORS BURN TRANSDNIESTRIAN FLAG, SMIRNOV PORTRAITS
Protesters demonstrating in front of the parliamentary building in Chisinau on 17 December burned the flag of the former Moldovan Soviet Socialist Republic, which now serves as the banner of the separatist regime in Transdniester, as well as portraits of separatist leader Igor Smirnov, Flux reported. The report did not include crowd estimates. Popular Party Christian Democratic Deputy Chairman Stefan Secareanu told the gathering that the symbolic gesture is "directed at the occupation regime in Chisinau, which is backed by the Party of Moldovan Communists and...the separatist clique in Tiraspol, headed by Smirnov." According to Flux, plainclothes policemen detained two of the participants for taking part in an "unauthorized demonstration." MS

BULGARIAN LEADERS AGREE ON NECESSITY TO MODERNIZE LEGISLATION ON NATIONAL SECURITY
The Consultative Council on National Security headed by President Georgi Parvanov agreed on 17 December on the need to amend national-security legislation, vsekiden.com reported. Parvanov said after the meeting that the adoption of an emergencies law must be a priority. He added that the law on defense and the armed forces must either be amended or replaced, and a law should be adopted to regulate the work of the National Intelligence Service (NRS). The council, which wields no executive or legislative power, includes the country's leading politicians from the governing and opposition parties, as well as the heads of the army, police, and intelligence services. UB

IS BELARUS'S 2004 DRAFT BUDGET PRACTICAL?
Belarusian President Alyaksandr Lukashenka's ambitious economic goals of 10 percent economic growth in 2004 and doubling living standards by 2006 probably sum up the social contract he is going to offer to his electorate in exchange for granting him a third term in office. But how will he achieve his plans?

The 2004 budget approved by the Chamber of Representatives does reflect these economic-policy priorities and gives an answer to the question what the official economic policy will be like in the short term. But the content of the document has immediately prompted a new discussion over the sustainability of the economic course underlining it.

The president insisted that the budget will be considered as an extraordinary law, which, according to the constitution, implies its speedy adoption and means that no meaningful discussion can be carried out on the draft. The new budget predicts revenues at 13.2 trillion Belarusian rubles ($6.14 billion) and expenses at 13.9 trillion. The numbers are projected with the planned 10 percent growth in mind, and this immediately gave rise to questions about whether such revenues are possible without printing money. The budget deficit is set at 690 billion Belarusian rubles, or 1.5 percent of gross domestic product (GDP). The budget is drafted with no National Bank loans to finance its deficit for the first time in recent history, which could be seen as a reasonable step toward fighting inflation.

Unfortunately, the sources of deficit finances are not stipulated, as the planned issue of treasury bills would cover less than one-third of planned deficit (or 200 billion Belarusian rubles). The remaining 590 million is to be raised from unspecified "additional sources of revenues." The government is pinning its hopes on selling treasury bills to foreign creditors and, possibly, increasing income from privatization. But such revenues are far from being guaranteed.

The central and local budgets combined would account for almost half of GDP. Such a high degree of redistribution is not likely to give a boost to the real sector, which already suffers from a heavy tax burden. The only serious tax cut foreseen in the budget is lowering the value-added tax (VAT) from 20 percent to 18 percent and reducing the upper threshold for local dues collected by regional and local authorities from 5 percent to 4 percent. VAT has also been slapped on cellular-telephone calls. This measure was particularly controversial and was immediately attacked in the media and even by the Communications Ministry, which fears that the new tax will hamper the development of cellular-telephone networks.

Meanwhile, several taxes have been raised, such as excise duties on alcohol and gasoline. A special tax to benefit road construction and the agriculture sector was also raised by 1 percent. The suggestion of introducing a special tax on "super-profitable businesses" (i.e., those with profitability exceeding 30 percent annually) was dropped at the last moment.

A dangerous tendency in the budget is the plan for relatively large spending on wages and social programs, which will account for almost one-half of the budget's total volume. Administrative wage rises -- the average monthly wage is planned at $170 by the end of 2004 -- have little to do with productivity growth and are effectively paid for by high and numerous taxes and other less-civilized forms of revenue extraction from all possible sources.

The U.S. dollar equivalent of the monthly average wage in Belarus has recently reached $135, up from $108 in January. This rise was partly achieved thanks to the weakening dollar -- in euro terms, the average monthly wage grew by just 6 euros during this period -- and, correspondingly, by its falling purchasing power.

If the decline of the U.S. dollar does not continue indefinitely, the populist spending on wages could create a serious budget crisis in the near future. World Bank representatives specifically pointed out on 11 December that this spending has a negative impact on the financial stability and is "potentially implosive in various ways in the short-term."

Indeed, Belarus has reached a level of redistribution comparable to West European welfare democracies but without a strong economy that can sustain gigantic social spending. The greatest puzzle of the 2004 budget is whether the government will be able to meet its generous social obligations to the population without getting into a situation when one part of the population is forced to pay too much for the welfare of another.

It should be noted that the budget was drafted without knowing the 2004 price for Russian natural gas, as negotiations with Gazprom on this issue could continue until 25 December. The calculations were made on the basis of the most optimistic scenario -- $50 per 1,000 cubic meters. President Lukashenka himself appeared on television and promised that utility bills would not rise by more than $4-$5 per month for an average family.

But any increase in the gas price by Gazprom over $50 per 1,000 cubic meters would mean a failure to deliver on this promise, and the budget will have to be amended, which may be done halfway through the year by presidential decree. Moreover, even in the current situation, the budget foresees that only 10 percent of the utility costs would be subsidized from the central budget, down from 50 percent in 2003. And just in November, the government quietly canceled a resolution according to which no family would have to pay more than 25 percent of its combined monthly income for housing services.

Furthermore, the 2004 budget incorporates for the first time ever the revenues and spending of the Fund for Social Protection of the Population, an institution responsible for most welfare payments and accounting for about 40 percent of the total budget. Unlike previous years, when the fund's revenues were spent exclusively on social programs, from now on the government receives discretionary powers over its finances.

Observers fear that this would give rise to a temptation to return to the Soviet-era practice of financing the social sector according to the "residual principle" -- that is, spending on welfare the amount that remains after all other expenditures have been paid. At the same time, the discretionary budgets of several law enforcement agencies are not incorporated into the central budget and are thus fully protected, which might give an idea of the government's real priorities for the coming year.

Vital Silitski is a Minsk-based freelance researcher.

AFGHAN LEADER DENIES MEDDLING IN CONSTITUTIONAL ASSEMBLY...
Afghan Transitional Administration Chairman Hamid Karzai on 17 December denied charges that he is exerting undue influence over Afghanistan's continuing Constitutional Loya Jirga, Hindukosh news agency reported. Karzai said members of the Constitutional Loya Jirga have full authority to decide on the draft constitution. The strongest criticism came from members of former Afghan President Burhanuddin Rabbani's Jamiat-e Islami party, who threatened to boycott the Constitutional Loya Jirga if Karzai uses his influence to alter the outcome of the assembly. Karzai countered that Rabbani is a man of understanding and the head of one of the committees of the Constitutional Loya Jirga (see "RFE/RL Newsline," 17 December 2003), so Rabbani would not allow his followers to disrupt the assembly. Jamiat-e Islami delegates want to debate the future form of government before the assembly discusses the text of the draft constitution, Reuters reported on 17 December. AT

...BUT HE IS ACCUSED OF A 'VIOLATION' OF DEMOCRACY
The official mouthpiece of the Jamiat-e Islami party on 15 December called Chairman Karzai's insistence on a presidential system for Afghanistan a "violation of the democratic atmosphere" of the Constitutional Loya Jirga. Some delegates said Karzai supporters exchanged harsh words with Jamiat-e Islami supporters, Reuters reported. Jamiat-e Islami is the largest party in the anti-Taliban coalition known internationally as the Northern Alliance. A Jamiat-e Islami delegate identified as Mehdi said that the party's "protest will continue until the government and the head of the [Constitutional Loya] Jirga listen to our legitimate demand, which is to specify what type of regime the delegates want before making them debate the government's proposed draft," according to Reuters. He added that delegates loyal to Rabbani and his allies "will not resume discussion until this issue is resolved." During the opening ceremonies of the Constitutional Loya Jirga on 14 December, Karzai defended his efforts to shore up presidential power in the proposed Afghan constitution, saying that centralized government authority is the only way to stabilize the fractious country (see "RFE/RL Newsline," 15 December 2003). Journalists working for foreign new agencies were not allowed to attend the 17 December Loya Jirga session. AT

LOYA JIRGA HEAD DEFENDS EXPULSION OF FEMALE DELEGATE
Constitutional Loya Jirga Chairman and former Afghan President Sebghatullah Mojadeddi on 17 December defended his expulsion the same day of Malalai Joya, a female delegate from Farah Province, Afghanistan Television reported. Joya objected to the presence of former mujahedin leaders in the Constitutional Loya Jirga, calling them "criminals" who should be tried by an international court (see "RFE/RL Newsline," 17 December 2003). Mojadeddi said he "noticed some dissatisfaction following the woman's [Malalai Joya's] comments" and ordered her out. After other representatives intervened, Joya was allowed to return to the assembly hall. Mojadeddi asked Joya to apologize for the comments she had made, but she refused, "The New York Times" reported on 18 December. Safia Sediqi, the only woman among four deputy chairpersons at the Constitutional Loya Jirga, defended Joya's right to express her opinion, saying, "If you are working for democracy here in this country, this is one way, this is one step." Female delegates have complained of de facto disenfranchisement in the assembly. While there are 100 female delegates to the 500-member Constitutional Loya Jirga, all 10 committees are headed by men and Sediqi was appointed to a deputy chairperson's post only after a protest by her female colleagues (see, "RFE/RL Newsline," 16 December 2003). AT

AFGHANS ARREST CHILD KIDNAPPERS
Security forces in Baghlan Province on 17 December arrested two men suspected of kidnapping 12 children, Afghanistan Television reported. The men had taken the children from the Baharak District of Badakhshan Province and apparently intended to transfer them to the Pakistani city of Peshawar. International organizations have warned that criminal gangs traffic in human organs removed from children and in children bound for slavery or the sex trade in the Middle East (see "RFE/RL Newsline," 26 September and 17 and 20 October 2003). AT

TEHRAN CLAIMS TOKYO WANTS EXTENSION IN OIL TALKS DEADLINE
National Iranian Oil Company Managing Director Mehdi Mir-Moezzi said on 17 December that Tokyo has requested an extension of the 15 December deadline for discussions on development of the Azadegan oil field, Kyodo World Service reported. The Japanese consortium that had exclusive rights to the project backed off from a 30 June deadline due to concerns about Iranian nuclear activities and the resulting pressure from Washington (see "RFE/RL Iran Report," 7 July 2003). The consortium consisted of Inoex Corporation, Japan Petroleum Exploration Company, and Tomen Corporation, but Tomen has decided to withdraw from the consortium, according to "Asahi Shimbun" on 14 December. Iranian government spokesman Abdullah Ramezanzadeh said on 15 December that this situation will not be a loss for Iran, IRNA reported. Iranian Foreign Minister Kamal Kharrazi recently visited Tokyo, and in a 1 December meeting with Prime Minister Junichiro Koizumi said that Japan should exercise an independent foreign policy, IRNA reported. Kharrazi said Iran wants the two countries to have the "best possible political and economic ties." BS

MORE TRAFFIC FATALITIES IN IRAN
Nearly 23,000 people have died so far in traffic accidents in Iran in the year that began on 21 March, "Iran Daily" reported on 18 December, citing "Siyasat-i Ruz." This number could rise to 370,000 within 10 years if measures to improve the roads are not implemented, the daily continued. Recent reports underline this trend. A bus carrying Iraqi pilgrims crashed into an electricity pylon on 16 December on the Borujerd-Malayer road, killing 15 and injuring another 23 people, state television reported. Four people were killed and six were injured when a bus traveling from Khorramabad to Shiraz drove head-on into a tractor-trailer, IRNA reported. On 28 November, there was a 200-car pile-up on the Tehran-Qom freeway, IranMania reported; police officials ascribed that accident to excessive speeds, tailgating, and drivers' inattention. Twenty-two Iranian pilgrims were killed and 16 others were injured when their bus collided with a truck on the road between Salafchegan and Saveh, state television reported on 16 November. BS

IRANIAN PRESIDENT HINTS AT DEATH PENALTY FOR SADDAM
President Hojatoleslam Mohammad Khatami on 17 December expressed his pleasure at the capture of former Iraqi dictator Saddam Hussein but questioned whether he will receive a fair trial because this could air his captors' dirty laundry, IRNA reported. "This is because he would undoubtedly raise some points that may not be appealing to many of those now standing against him," Khatami said. "We hope that the truth will be unveiled and it is made clear what crimes Saddam has perpetrated, to which countries he was linked, and what support he received." Khatami said he generally opposes capital punishment, "but I believe that if there is going to be a death sentence, it would be the fairest to pass on Saddam." The Iraqi Governing Council's (IGC) current president, Abd al-Aziz al-Hakim of the Supreme Council for the Islamic Revolution in Iraq (SCIRI), reiterated during a 17 December visit to London the IGC's desire to see Hussein tried by a special tribunal in Iraq, IRNA reported. Al-Hakim said the tribunal was created specifically to handle cases against leading members of the former regime. Al-Hakim also said Iran deserves to be compensated for the damage it suffered at the hands of Hussein, Reuters reported. "According to the UN, Iran deserves reparations. She must be satisfied," he said. "Whether we will pay or not is something which we need to discuss further." BS

IRAN WANTS TO TRY MUJAHEDIN KHALQ LEADERS
President Khatami said after the 17 December cabinet meeting that Tehran would like to have members of the Iraq-based Mujahedin Khalq Organization (MKO) extradited to Iran although a formal request to that effect has not been made yet, IRNA reported. There are about 3,800 MKO members in Iraq, and the IGC decreed on 9 December that all of them must leave Iraqi territory by 31 December (see "RFE/RL Iran Report," 15 December 2003). Khatami said there is a difference between the younger MKO rank and file and the terrorist group's leadership. He added that some MKO members will therefore be pardoned, saying, "We believe that many of the MKO members who have not committed any crimes should be pardoned and enabled to return to Iran." Meanwhile, Iran's Arabic-language Al-Alam television on 17 December cited anonymous "Iraqi sources" as saying that U.S. forces persuaded MKO leader Masud Rajavi to leave Iraq after Saddam Hussein was captured. BS

DOCUMENTS FOUND WITH DEPOSED IRAQI PRESIDENT REVEAL CELL NETWORK
Documents reportedly found in a briefcase in the underground bunker where deposed Iraqi President Saddam Hussein was found on 13 December revealed the funding structure for 14 insurgent cells fighting coalition forces, telegraph.co.uk reported on 18 December. U.S. forces have used the information to arrest three former Iraqi generals and to break up six of the 14 cells, the website reported. "What the capture of Saddam Hussein revealed is the structure that existed above the local cellular structure -- call it a network," U.S. Brigadier General Mark Dempsey told reporters in Baghdad. "We now know how the cells are financed and how they are given broad general guidance." According to the website, Hussein was not directing the daily operations of militants, but was given briefings in the form of minutes from meetings held by the "council of the rebels' network." Dempsey said that there were approximately 1,000 active militants in Baghdad, of whom 100 to 200 are "passionate" about their role, while the rest are exploiting the security situation, probably for financial gain. KR

SCIRI MEMBER, BA'ATH PARTY OFFICIAL ASSASSINATED IN IRAQ
SCIRI has said that SCIRI official Muhammad al-Hakim was assassinated in the Al-Amiriyah neighborhood of Baghdad on 17 December, Al-Jazeera reported the same day. Al-Hakim reportedly received death threats last week from Hussein loyalists. "He received threats that he would be liquidated, murdered, by the men of the regime," Reuters quoted a SCIRI official as saying on 18 December. Former Ba'ath Party official Ali al-Zalimi was assassinated in Al-Najaf on 17 December. "What happened was that the people surrounded him with guns and proceeded to shoot and beat him," the same SCIRI official told Reuters. Al-Jazeera said that al-Zalimi was attacked and killed by passersby who recognized him in the Shi'ite holy city. Al-Zalimi reportedly played a role in crushing the 1991 Shi'ite uprising in Iraq. KR

IGC MEMBERS BRIEF REPORTERS ON HUSSEIN...
Iraqi Governing Council members Adnan Pachachi and Muwaffaq al-Rubay'i read a statement by Governing Council members to a weekly Baghdad press conference on 17 December calling for "a spirit of tolerance to build national unity " in Iraq and for "the misled military and civilians who did not commit crimes against the people to prove their loyalty to the homeland," Al-Jazeera reported the same day. Pachachi dispelled reports that the new war-crimes tribunal in Iraq does not provide for the appointment of foreign judges and other international legal experts if necessary. He added that the death penalty for deposed President Hussein "should be decided by the tribunal," but added that he does not support that punishment. Al-Rubay'i cautioned reporters to refer to Hussein as "defendant Saddam Hussein" rather than "criminal Saddam Hussein" so not to prejudge the deposed president before a trial is held. Both men denied reports that the United States moved Hussein out of Iraq. Regarding rumors circulating in the Arab press this week that former Hussein-regime Revolutionary Command Council Vice Chairman Izzat Ibrahim al-Duri, who is sixth on the U.S.-led coalition's list of the 55 most-wanted former-regime figures, had either surrendered or been captured, al-Rubay'i said it was known that two "medium-sized fishes" were captured but he said he did not know if al-Duri was among them. KR

...AND ON POLITICAL DEVELOPMENTS
Iraqi Governing Council member al-Rubay'i also briefed reporters on 17 December about legal and political steps initiated by the Governing Council in recent weeks, Al-Jazeera reported. He said that the fundamental law will be issued on 28 February, and the election of conferences will be held between 1 March and 1 June to select members of the transitional national assembly. He expects an interim government to be formed between 1 June and 1 July and to govern for 18 months. Al-Rubay'i also said that the Governing Council will soon issue a property law that will address the issue of confiscated property and other property claims. Committees will initially be established in Baghdad, Mosul, and Al-Basrah to investigate such claims. Regarding reconstruction contracts, he said that many Governing Council members believe that countries that did not participate in the toppling of the Hussein regime should not be prevented from assisting in the reconstruction of Iraq. KR

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