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Newsline - January 4, 2005


MOSCOW DECIDES STRATEGIC PIPELINE WILL GO AROUND CHINA...
Prime Minister Mikhail Fradkov on 30 December signed a directive on construction of an $18 billion oil-export pipeline connecting Western Siberia with the Pacific coast, rbk.ru, ngv.ru, and other media reported. The state-controlled pipeline monopoly Transneft will be the main contractor of the 4,200-kilometer pipeline with a projected annual output of up to 80 million tons (503 million barrels), which will run from the Irkutsk Oblast town of Taishet to the port of Pervoznaya near Nakhodka on the Sea of Japan. The choice of the pipeline route became the subject of bitter rivalry between China, which lobbied for a route from Angarsk to the Chinese city of Datsin, and Japan, which supported the Taishet route. The approved route gives Russia the opportunity to export oil not only to Japan, but also to the whole Asian-Pacific region, including South Korea and United States. Despite the victory, Tokyo is not jubilant, "Asahi Shimbun" noted on 3 January. "Japanese officials are not sure how the pipeline will progress when negotiations begin on the level of Japanese investment," added the newspaper. The approved route will pass some 150 kilometers north of Lake Baikal, apparently in response to environmental concerns arising from earlier proposals (see "RFE/RL Newsline," 3 September 2003). VY

... BUT SAYS CHINA CAN BUY SHARES OF YUKOS SUBSIDIARY...
Industry and Energy Minister Viktor Khristenko announced on 30 December that up to 20 percent of Yukos subsidiary Yuganskneftegaz, which was bought by state-owned oil major Rosneft on 19 December, "may be acquired" by the Chinese National Petroleum Corporation (CNPC), according to the ministry's website (http://www.mte.gov.ru/docs/1/2414.html). Khristenko also said Yuganskneftegaz will be not incorporated into the consolidated assets of Rosneft and Gazprom, but will be set up as "a separate company 100 percent owned by the state." President Vladimir Putin first mentioned the possibility of Chinese involvement in Yuganskneftegaz last month (see "RFE/RL Newsline," 22 December 2004). Meanwhile, CNPC announced that it is not aware of any Russian offer concerning Yuganskneftegaz, mosnews.ru reported on 3 January. A CNPC executive in Moscow said, "These talks must be going on at the top level; we don't know any details." VY

...AS YUKOS THREATENS TO SUE NEW OWNERS
Rosneft announced on 31 December that it has paid the full price for Yuganskneftegaz (see "RFE/RL Newsline," 17, 20, and 21 December 2004) and has become the full-fledged owner of the Yukos subsidiary, RTR and other media reported. Rosneft also announced that an extraordinary meeting of Yuganskneftegaz shareholders decided on 31 December to discontinue the company's agreement with Yukos as the governing company of Yuganskneftegaz, and elected Vladimir Bulba, former head of Rosneft subsidiary Purneftegaz, as the new general director of Yuganskneftegaz. Meanwhile, Yukos's management declared that it considers all actions around Yuganskneftegaz violations of Russian and international law tantamount to the "illegal seizure of assets" and will pursue the perpetrators of these actions in court, newsru.com reported on 1 January. VY

PUTIN PUNISHES AIDE AFTER CRITICISM OF KREMLIN POLICY
The presidential press service announced on 31 December that President Putin removed his economic adviser, Andrei Illarionov, from his position as Russia's representative to the Group of Eight industrialized nations (G-8) and replaced him with another aide, Igor Shuvalov, RTR and other media reported. Shuvalov will also replace Illarionov in organizing Russia's chairmanship of the G-8 in 2006. The move follows Illarionov's harsh criticism of the Kremlin's and the government's economic polices in 2004 and his condemnation of the takeover of Yuganskneftegaz by Rosneft as the "swindle of the year" (see "RFE/RL Newsline," 31 December 2004). Moreover, Illarionov unexpectedly appeared at Moscow's Meshchanskii Raion Court on 31 December at the trial of jailed former Yukos CEO Mikhail Khodorkovskii and his business associate, Platon Lebedev. In contrast to the liberal Illarionov, Shuvalov is known as an ardent Putin loyalist. Within the presidential administration, he is responsible for informational and analytical support of the presidential administration and heads the expert department. VY

FOREIGN MINISTER SAYS NO NEW COLD WAR OVER UKRAINE AND GEORGIA...
Foreign Minister Sergei Lavrov said in an interview with the German business daily "Handelsblatt" on 28 December that there is no threat of a new Cold War between Russia and the West over Ukraine if "the principle of noninterference in the internal affairs of Ukraine is maintained," according to the Russian transcript of the interview published on 3 January by mid.ru. Talking about the possibility of Ukraine and Georgia joining NATO and the European Union, Lavrov said that Russia will not obstruct these developments as Russia respects "the right of each state, including our neighbors, to choose its own partners." Lavrov added that in those cases, however, Ukraine and Georgia could not rely on privileged economic relations with Russia. It is "their choice," and "we assume they consider how they develop their policy and economy and which partners and allies they choose," he added. VY

...THAT RUSSIA NOT STRIVING TO JOIN EU...
In the same 28 December interview, Lavrov said that Russia does not want to join the EU and "nobody has proposed doing so." Lavrov noted that Russian trade with the EU is $100 billion a year, which is about half of the country's foreign trade turnover, and that for Russia it is important that the EU exists as a power center in the system of multipolar international relations. Lavrov also said that Russia hopes to reach agreements with the EU that take into account Russian specifics, including its size and geopolitical location. VY

...AND NAMES RUSSIAN CANDIDATES FOR ENLARGED UN SECURITY COUNCIL
Lavrov also said in the 28 December interview that Russia supports the reform of the UN and the admission of new permanent members into the UN Security Council. As far as Russia is concerned "the strong and obvious candidates" are "Germany, Japan, Brazil, and India and absolutely a representative of Africa," he said. He added that there is disagreement on this issue among present permanent members, but that Russia will accept any reform based on consensus. "We are against a vote on the matter, which would divide the United Nations. Because then a new Security Council would lose its legitimacy," he said. VY

GOVERNMENT OUTLINES 2004 ACHIEVEMENTS...
The government has issued an outline of its main achievements in 2004, ITAR-TASS reported on 2 January. According to the statement, the Interior Ministry solved 1,427,000 crimes in the first 11 months of the year, including 1,500 crimes "of a terrorist nature." That figure represents a 41.5 percent increase over 2003. The Emergency Situations Ministry reported that there were 951 emergencies in same period, claiming 2,077 lives. About 15,800 people died in fires. The Defense Ministry reported progress implementing its military reform plan. The Justice Ministry said its main achievement in 2004 was improving the legal framework for combating terrorism and extremism. The Finance Ministry hailed the creation of the stabilization fund, while the Economic Development and Trade Ministry was proudest of the medium-term social-development program that it endorsed in 2004. RC

...AS DEPUTY CONSIDERS DUMA'S PERFORMANCE
State Duma Deputy Viktor Pleskachevskii (Unified Russia), chairman of the Property Committee, told ITAR-TASS on 2 January that the current Duma is far more professional than its predecessors and that it is doing a much better job of drafting economic legislation. The Unified Russia majority has "become a political mechanism for the establishment of standards of market-oriented legislation," he said. He said that the passage of the law on the monetization of most in-kind social benefits was the Duma's greatest achievement last year. "This is a very important factor for economic development that upset many set notions" from the Soviet era, he commented. He said that his committee's main goal for 2005 will be to continue amending the Land Code in order to counteract "the sabotage of land reform on the part of the governors." RC

FINANCE MINISTER EXPRESSES 'ABSOLUTE CONFIDENCE' IN RUBLE
Finance Minister Aleksei Kudrin told RTR on 3 January that "given the dynamic forecast for 2005, the dynamics of the [U.S.] dollar, the euro, and the ruble, I am absolutely convinced and absolutely confident" that Russians should hold their savings in Russian rubles. He added that "the ruble will not weaken against the euro or the dollar and this means it might even strengthen against them." Kudrin spoke out against recent calls in the Duma to bring minimum wages in line with the official minimum cost of living as rapidly as possible. "To do so we would have had to increase wages fivefold," Kudrin said. "Where would we get all this money in order to increase wages fivefold? Should we borrow money...? This is a very dangerous policy, one that was often resorted to in the 1990s. Wages were increased, but the inflation rate grew even faster. We believe that the right way is to move gradually, stage by stage." RC

NO MORE CONSCRIPTS TO BE SENT TO CHECHNYA, MINISTER SAYS
Defense Minister Sergei Ivanov told Interfax on 2 January that "young draftees no longer serve in Chechnya and will never be sent there again." He said that, following a reform that placed the railway troops under the Defense Ministry's jurisdiction, the country's armed forces now number 1,207,000 service personnel. The ministry also has 876,000 civilian personnel. Ivanov said this is "an optimal figure required to maintain the defense sufficiency level." RC

GROUP CALLS FOR REFERENDUM ON CONSCRIPTION DEFERRALS
The Union of Committees of Soldiers' Mothers intends to initiate a national referendum on the issue of government proposals to curtail sharply the practice of granting deferrals for military conscription, Interfax and other Russian media reported on 2 January, citing union Executive Secretary Valentina Melnikova. Defense Minister Ivanov announced on 29 December that the government plans to end deferrals, saying that Russia now has "24 or 25" legal reasons for postponing service and that the number increased dramatically in the late 1990s. Ivanov said the end of deferrals is connected with the government's plan to reduce the military-service period to one year. Our Choice leader Irina Khakamada told Ekho Moskvy on 3 January that she supports the referendum initiative, but added that the authorities will use any pretext to prevent it from being conducted. She said the only way to fight for continued deferments is "to take to the streets" since "the authorities have adopted a law under which, obviously, no referendum will be deemed legal." RC

LIBERAL POLITICIAN LAMENTS SETBACKS OF 2004
Union of Rightist Forces (SPS) political council member Boris Nemtsov told Interfax on 4 January that 2004 will be remembered in Russia as the year of the "cleansing" of the country's democratic achievements, including independent television, the direct election of regional leaders, and the principles of federalism. He said that the only bright spot of the year was the "birth of a democratic Ukraine." He noted that the SPS has had "definite successes" in several regional elections, which he said is "particularly pleasant and important considering that the party still lacks a leader." Last month, Nemtsov criticized the de facto censorship of many topics on Russian television and characterized the Kremlin as "a lying regime" (see "RFE/RL Newsline," 14 December 2004). RC

ARMENIAN PRESIDENT CITES PROGRESS IN ECONOMIC REFORM, FOREIGN POLICY IN NEW YEAR'S ADDRESS
In his annual New Year's address on 31 December, Armenian President Robert Kocharian praised the country's achievements in economic reform and foreign policy during 2004, Armenian television and Armenpress reported. The Armenian president cited 2004 as "a year of peace, stability, and success for Armenia" and noted the country's "significant economic development," but called for further reforms aimed at reducing poverty and improving living conditions. Kocharian also stressed progress in foreign relations and welcomed Armenia's inclusion in the EU's European Neighborhood Policy of engagement in the region. RG

ARMENIAN GOVERNMENT VOWS TO PROMOTE TOURISM
The Armenian government vowed on 30 December to "aggressively" promote Armenia's growing tourism industry, RFE/RL's Yerevan bureau reported. In comments following a cabinet meeting, Deputy Trade Minister Ara Petrosian announced the adoption of a new "state program for tourism development in 2005," to be run by the Trade and Economic Development Ministry, which will implement "an active and aggressive advertising campaign in the international tourism markets." Armenia's tourism sector has expanded significantly in recent years, with 260,000 foreign visitors coming to Armenia in 2004, an increase over 2003 of 206,000. As roughly 60 percent of the tourists are diasporan Armenians, the government sees an opportunity to expand tourism further by targeting non-Armenians. RG

AZERBAIJANI OPPOSITION LEADER BLAMES AUTHORITIES FOR CLOSURE OF NEWSPAPER
Opposition Musavat party Chairman Isa Qambar accused Azerbaijani authorities on 3 January of forcing the closure of his party's daily "Yeni Musavat" newspaper, Turan reported. Qambar explained that newspaper staff have been repeatedly harassed by police, its finances investigated and was forced to pay excessive fines after losing 10 libel lawsuits brought against the newspaper. Reporters Without Borders sent Interior Minister Ramil Usubov a letter on 30 December expressing concern over the case of a "Yeni Musavat" staff photojournalist, Alim Kazimov, who was recently assaulted while in police detention, according to Turan. Although the opposition daily has enjoyed a rather large circulation among opposition newspapers, it was widely held to be an unreliable news source. The paper was forced to cease publication in November after losing a libel suit that resulted in a court order imposing a severe fine and freezing its bank account (see "RFE/RL Newsline," 16 November 2004). "Yeni Musavat" Editor in Chief Rauf Arifoglu was one of seven prominent opposition figures sentenced to prison terms in October on charges of inciting violence in the wake of the disputed October 2003 presidential election (see "RFE/RL Newsline," 25 October 2004). RG

HEAD OF AZERBAIJANI OIL FUND REPORTS PROCEEDS OF NEARLY $1 BILLION
Azerbaijani State Oil Fund Executive Director Samir Sharifov announced on 3 January that with the recent increase in global oil prices, the fund has grown to $970 million, Turan reported. Created in 1999, the Azerbaijani State Oil Fund was established to manage oil revenue and reduce the country's long-term dependence on the energy sector. The growth of the fund exceeds initial estimates by almost $30 million but remains troubled by a lack of transparency and a management structure directly subordinate to the president. RG

AZERBAIJANI PRESIDENT CITES 2004 AS 'TURNING POINT' IN NAGORNO-KARABAKH TALKS
In a 31 December New Year's address to the nation, Azerbaijani President Ilham Aliyev called 2004 "a turning point" in talks over the unresolved Nagorno-Karabakh conflict, Turan reported. Aliyev cited "progress in the negotiating process," and added that the international community "has started paying more attention to the problem." Aliyev reaffirmed, however, that he would "never make any concessions in question of its territorial integrity" and vowed to "not discuss the subject." Commenting on other developments, Aliyev noted the progress of the Baku-Ceyhan oil pipeline, which is set to become operational later this year, and the construction of the accompanying Baku-Tbilisi-Erzerum natural-gas pipeline. RG

GEORGIAN DEFENSE MINISTER ANNOUNCES ARMY REORGANIZATION
Georgian Defense Minister Irakli Okruashvili revealed on 3 January a series of sweeping changes in the structure of the Georgian Army, Rustavi-2 television reported. Okruashvili announced the appointment of new brigade commanders and initiated a reduction in the size of the army by dismissing 1,400 officers. The reforms also include reorganization measures that would force the early end of military service for at least 5,000 conscripts. Okruashvili defended the plan as the only way to tackle corruption and inefficiency in the armed forces and noted that commanders have been taking bribes by some conscripts to avoid their service. The move follows a series of desertions and mutinies over poor living conditions, most recently on 20 December (see "RFE/RL Newsline," 21 and 22 December 2004). Interior Ministry troops are also to be immediately incorporated into the armed forces and those units are to be reassigned into four newly restructured brigades. The overall goal is to restructure the Georgian armed forces with total manpower not to exceed 23,000, including 15,000 ground troops. Okruashvili was appointed defense minister in mid-December after serving as interior minister (see "RFE/RL Newsline," 15 December 2004). RG

GEORGIAN PRESIDENT MEETS WITH NEW UKRAINIAN LEADER IN KYIV
Georgian President Mikheil Saakashvili met on 2 January with Ukrainian President-elect Viktor Yushchenko during a visit to Kyiv, Imedi TV and ITAR-TASS reported. Saakashvili arrived in the Ukrainian capital on 31 December and held a number of meetings with Yushchenko's advisers. Georgia's "Rose Revolution" that swept Saakashvili to power in late 2003 was hailed as an inspiration for the "Orange Revolution" in Ukraine and both leaders are seen as sharing a defiance of Russian influence. RG

GEORGIA CRITICIZES RUSSIAN MOVE TO END OSCE MONITORING OF BORDER
The Georgian Foreign Ministry issued a statement on 31 December criticizing the Russian move to end the monitoring of the Georgian-Russian border, ITAR-TASS and Rustavi-2 reported. The monitoring mission, carried out by the Organization for Security and Cooperation in Europe (OSCE), was set to expire on 1 January. The Russian Foreign Ministry explained that the OSCE monitors "have fulfilled their task on the Georgian-Russian border," and added that "Russia and Georgia are successfully cooperating to ensure the security of our common border." The Russian statement also promised to expand "cooperation with the Georgian border guards and special services in order to prevent the border from being illegally crossed in either direction and to counter terrorist activity." RG

RUSSIAN BORDER GUARDS REPORT DRUG SEIZURES ALONG TAJIK-AFGHAN BORDER
According to a command officer assigned to the Russian Federal Security Service border directorate in Tajikistan, Russian guards seized over 2.5 tons of heroin along the Tajik-Afghan border in 2004, ITAR-TASS reported on 3 January. Lieutenant Colonel Petr Gordienko said that Russian border guards also interdicted over three dozen illegal shipments of arms, including grenade launchers, mines, and tank shells, as well as small arms. RG

TURKMENISTAN CONCLUDES NEW AGREEMENT ON GAS SHIPMENTS TO UKRAINE
Ukrainian oil and gas company Naftohaz Ukrayiniy Chairman Yuriy Boyko announced in Ashgabat on 3 January that a new agreement on the price for Ukrainian imports of natural gas from Turkmenistan has been reached, ITAR-TASS reported. The new agreement follows weeks of negotiations and sets a one-year contract for the import of 36 billion cubic meters of Turkmen gas at the new price of $58 per 1,000 cubic meters. The agreement follows a cutoff of gas supplies by Turkmenistan on 31 December, ITAR-TASS reported. Although the new price is $14 higher than the rate fixed for 2004 and reflects the global increase in natural-gas prices, payment for the gas imports remains half in cash and half in "goods and equipment" from Ukraine. Turkmenistan also reached agreement on a 25-year contract with Russia in 2004 for the sale of between 6 billion and 7 billion cubic meters of Turkmen gas. RG

UZBEK HUMAN RIGHTS GROUPS SPOTLIGHT ALLEGED TORTURE DEATH
Two Uzbek human rights groups issued a statement on 3 January to call attention to the case of an Uzbek man whose family members allege was tortured to death by authorities, RFE/RL's Uzbek Service reported. The independent Human Rights Society of Uzbekistan and the Ezgulik human rights group revealed the possible torture death of Samandar Umarov, a prisoner who had been serving a 17-year sentence for belonging to the outlawed Islamist group Hizb ut-Tahrir. Uzbek officials have promised an official investigation into the circumstances of the prisoner's death. RG

BELARUSIAN COURT SENTENCES OPPOSITIONIST TO FIVE YEARS FOR THEFT
A district court in Minsk on 30 December sentenced opposition politician Mikhail Marynich to five years in prison after finding him guilty of stealing computers and other office equipment belonging to the U.S. Embassy, Belarusian and international news agencies reported. Marynich told the court that the case against him was "fabricated by the KGB following an order from the authorities," arguing that the equipment had been provided free of charge by the U.S. Embassy in Minsk to the Dzelavaya Initsyyatyva (Business Initiative) association, of which he was chairman. The U.S. Embassy did not report the computers stolen, and a U.S. State Department statement presented to the court said the embassy had no claims against Marynich. According to Marynich, the sentence is intended to prevent him from participating in the 2006 presidential election. Marynich's lawyers have announced that they will appeal the verdict. Marynich was minister of foreign economic relations (1994-98) and afterward became Belarusian ambassador to Latvia, Estonia, and Finland. In mid-2001, Marynich resigned his ambassadorial post to challenge Lukashenka in that fall's presidential election (see "RFE/RL Belarus and Ukraine Report," 4 January 2005). JM

BELARUS SIGNS GAS-SUPPLY DEAL WITH GAZPROM FOR 2005
Beltranshaz, Belarus's state-owned gas-transport company, and Russia's Gazprom on 30 December signed a contract for the supply of 19.1 billion cubic meters of Russian gas in 2005 at $46.68 per 1,000 cubic meters, Belapan reported. The contract also stipulates the supply of an extra 1.4 billion cubic meters of gas to Belarus "provided there is a technical opportunity." Under the deal, Belarus will collect $0.75 in transit fees per 1,000 cubic meters for every 100 kilometers of gas pipelined via Belarus through Beltranshaz's network and $0.46 for gas transported by the Yamal-Europe pipeline. Both the gas price and the transit fees remain unchanged compared with those in 2004. "[The price] seems to be the same as in 2004, but it has de facto been raised by 18 percent; that is, by the amount of value-added tax, which will now be collected under the country-of-destination principle," Belarusian Deputy Prime Minister Andrey Kabyakou commented (see "RFE/RL Belarus and Ukraine Report," 23 December 2004). JM

UKRAINIAN PRIME MINISTER RESIGNS...
Prime Minister Viktor Yanukovych stepped down on 31 December, announcing that he will remain in politics as "an independent politician who legitimately won the elections on 21 November," Ukrainian and international news agencies reported. "Dear compatriots and friends, in light of everything that has happened, it would be senseless for me to stay on as prime minister," Yanukovych said in a televised address to the nation. "The political role of the Yanukovych government -- as a stabilizing force over the past year -- has been all but exhausted.... I think it will be impossible for me to hold any official position in the new government." JM

...BUT REFUSES TO ADMIT PRESIDENTIAL DEFEAT
Yanukovych has refused to concede his defeat in the 26 December presidential poll, in which, according to preliminary results, he obtained 44 percent of the vote compared to his rival Viktor Yushchenko's 52 percent, Ukrainian media reported. Yanukovych challenged Yushchenko's victory by appealing to the Supreme Court and the Central Election Commission (TsVK) against the organization of the 26 December repeat of the rigged 21 November presidential runoff and of election irregularities. However, his complaints were rejected last week. Yanukovych proxy Nestor Shufrych told journalists on 3 January that Yanukovych's election team will appeal the official election results as soon as they are announced by the TsVK. TsVK Chairman Yaroslav Davydovych said the same day that the official results will be released "within the next few days." JM

YUSHCHENKO CELEBRATES NEW YEAR WITH SUPPORTERS ON INDEPENDENCE SQUARE
Viktor Yushchenko told a New Year's rally of his supporters on Independence Square in Kyiv on 31 December that Ukraine is a free country following his victory in the 26 December presidential vote, Ukrainian media reported. "We have been independent for 14 years, but we have not been free. Today we are independent and free. I would like to congratulate you on this, my Ukrainian people," Yushchenko said. The rally was attended by Georgian President Mikheil Saakashvili, who said in an emotional speech delivered to the crowd in Ukrainian that Ukraine's "Orange Revolution" has changed Europe. "Good overcame evil in this square," Saakashvili said. "You had us relive the moments of joy that we sensed during our own, Georgian, revolution." JM

KUCHMA APPEALS TO UKRAINIANS TO WELCOME NEW PRESIDENT
Outgoing President Leonid Kuchma said in a televised New Year's address to the nation on 31 December that Ukraine "has gone through extraordinarily difficult times and really has become different," the UT-1 channel reported. "There will be a new president in Ukraine in 2005," Kuchma said. "And the whole of Ukraine, each region and every citizen, should receive this democratic choice as their very own choice. This person will need your support." JM

YUSHCHENKO VOWS GOOD RELATIONS WITH RUSSIA -- ON ONE CONDITION
Yushchenko told the 31 December issue of the German magazine "Der Spiegel" that Ukraine will continue to develop good relations with Russia, spiegel.de reported on 2 January. "Russia continues to be a strategic partner in the political, economic, and military fields," Yushchenko said. "Our strategy aims to achieve European integration and this is the framework in which we need to resolve all problems together with Russia," he said. "We would like to encourage making mutual investments, removing trade barriers, and resolving problems associated with the influx of workers.... There is, however, one condition: Putin must not block our way into the European Union." JM

CROATIAN PRESIDENTIAL RUNOFF FOR TWO MAINSTREAM CANDIDATES...
Croatian President Stipe Mesic, who is backed by three center-left opposition parties, will face Deputy Prime Minister Jadranka Kosor of the governing Croatian Democratic Community (HDZ) in a 16 January runoff because no candidate won the necessary 50 percent in the first round on 2 January, international and regional media reported. In preliminary official results, Mesic took 48.9 percent of the votes cast against 20.3 percent for Kosor. Voter turnout was about 51 percent of those eligible, as compared to 63 percent for the 2000 presidential ballot. Some preelection polls had suggested that Mesic was headed for a first-round victory, and several commentators later argued that such polls prompted many of his supporters to become complacent and stay home. Mesic has carefully cultivated a "man of the people" image and played a key role in dismantling the authoritarian nationalist power structure of the late President Franjo Tudjman. Mesic said on 2 January that the second round will provide Croats with the opportunity to move "forward into the 21st century or turn back." But Kosor also favors EU and NATO membership, having helped disassociate the HDZ from Tudjman's legacy (see "RFE/RL Balkan Report," 17 and 24 September 2004). She stresses that the time has come for Croatia to have a female president. PM

...AS SOME DEFEATED CANDIDATES CRY FOUL
Croatian-American businessman Boris Miksic, who ran as an independent, finished third in the 2 January Croatian presidential vote with 17.8 percent of the total, international and regional media reported. He charged that he was cheated out of a second-place finish and called for a protest by his supporters, about 2,000 of whom turned out to demonstrate in Zagreb. He compared the ballot to the tainted first round of voting in the recent Ukrainian presidential elections, claiming that Mesic and the HDZ made a deal at his expense. Three other candidates, who each received only a few percent of the total votes cast, said that they want ballot counting suspended because of what they charged was a violation of electoral legislation by state-run Croatian Television (HTV), which reported the results of an opinion poll on 31 December during the immediate preelection period when campaigning is banned. PM

CONSOLIDATION OF BOSNIAN INTELLIGENCE AGENCIES TAKES EFFECT
More than 500 security officials from Bosnia-Herzegovina's two entities lost their jobs at the end of 2004 as part of a reform aimed at setting up a unified Bosnian intelligence service, the Banja Luka daily "Nezavisne novine" reported on 3 January. About 200 personnel from the former Bosnian Serb intelligence agency (OBS) were affected, as were about 300 from its counterpart in the Muslim-Croat Federation (FOSS). The new agency will employ a total of 703 people. Downsizing and consolidating military, police, and intelligence operations is an important component of preparing Bosnia for eventual membership in Euro-Atlantic institutions. Such reforms have been resisted by many of the power structures that emerged during the 1992-95 conflict (see "RFE/RL Balkan Report," 22 October 2004). PM

KOSOVA'S LEADERS HAVE BIG HOPES FOR 2005
Kosova's President Ibrahim Rugova said in Prishtina on 31 December that 2004 witnessed the consolidation of Kosova's elected institutions and the development of a healthy parliamentary system with a government and a vocal opposition, RFE/RL's South Slavic and Albanian Languages Service reported. He expects that 2005 will be a year in which the elected institutions acquire further responsibilities and powers from the UN civilian administration (UNMIK) and in which all ethnic groups and minorities become more integrated into Kosova's society and its institutions. Elsewhere, Prime Minister Ramush Haradinaj noted that the government and its institutions take their duties and responsibilities very seriously. For his part, speaker of the parliament Rexhep Daci stressed that "we will impart to the citizens of Kosova and Albanians wherever they might be the special optimism" that he and Haradinaj share for the future. Daci stressed that in 2005 "the Kosovars will come to feel that they have their own institutions for the first time" (see "RFE/RL Balkan Report," 10 and 17 September, and 3 and 17 December 2004). PM

MACEDONIAN OPPOSITION PARTY DEMANDS NEW AMNESTY TO BENEFIT THE POLICE
The conservative opposition Internal Macedonian Revolutionary Organization-People's Party (VMRO-Narodna), which is unofficially led by former Prime Minister Ljubco Georgievski, wants a new amnesty law for crimes linked to the 2001 conflict between ethnic Albanian insurgents and the Macedonian authorities, "Vreme" reported on 4 January. The VMRO-Narodna argues that only members of the ethnic Albanian National Liberation Army (UCK) have benefited from the previous amnesty enacted after the conflict, while members of the Macedonian Army and police can still be prosecuted. The VMRO-Narodna wants a new amnesty law to permit "the release of those [policemen] indicted in connection with the Rastanski lozja case," acting VMRO-Narodna Chairwoman Vesna Janevska said. Macedonian police killed six Pakistanis and one Indian in Rastanski lozja outside Skopje on 2 March 2002, later claiming the victims were Islamist terrorists. The investigation of this case disclosed, however, that the killing was staged by Interior Ministry officials (see "RFE/RL Balkan Report," 27 May and 20 August 2004). The most prominent indictee in the case is former Interior Minister Ljube Boskovski. UB

ROMANIA'S NEW LEADERS OPT FOR INFORMAL STYLE
Departing from custom, President Traian Basescu on 31 December delivered a short and improvised televised address to the nation during a public New Year's celebration at Bucharest University Square, the dailies "Romania libera" and "Evenimentul zilei" reported on 3 January. Basescu's predecessors, communist President Nicolae Ceausescu and his postcommunist successors Ion Iliescu and Emil Constantinescu, traditionally delivered lengthy televised speeches from the presidential palace. Upon completing a short speech, Basescu drank from a huge bottle of champagne that he then passed on to a cheering crowd. Prime Minister Calin Popescu-Tariceanu on 1 January chaired in Sinaia an informal meeting of members of his new cabinet, who were accompanied by members of their family "to help us get better acquainted." Due to a traffic jam on the Sinaia-Bucharest road, Popescu-Tariceanu boarded a train after the meeting. The train was also packed and the prime minister, accompanied by his wife, traveled to Bucharest standing and exchanging jokes with fellow passengers. On 3 January, Mediafax reported that Popescu-Tariceanu is refusing to move from his home to an official residence. MS

NEW ROMANIAN CABINET 'SUSPENDS' CONTROVERSIAL DEBT WRITE-OFF
The cabinet on 30 December decided to "suspend" for 90 days an emergency ordinance issued by the previous government on the write-off of debts owed to the state by the Rafo Onesti and Caro Onesti companies, according to an official governmental press release. The previous cabinet's ordinance was issued in November and would have written off some 15,000 billion lei ($532 million) in arrears owed to the budget by companies whose owners are allegedly close to the former ruling Social Democrats. Finance Minister Ionut Popescu said the same day that the decision to suspend the write-off is intended to serve as a "signal" to companies with large arrears to the budget, and that the AVAS (the authority in charge of recuperating debts owed to the state) will examine the two companies' records during the 90-day suspension. Ionut also confirmed that the cabinet is examining the possibility of nullifying a write-off granted by the previous cabinet to the National Tobacco Company (SNTR) for taxes owed in 2003. In January 2004, an EU-Romanian consortium acquired a 56.4 percent stake in the SNTR. MS

ROMANIAN GOVERNMENT'S HARMONY ENDANGERED BY DISPUTE OVER PREFECTS' APPOINTMENT
The Covasna County local branches of new coalition members National Liberal Party (PNL), the Democratic Party, and the Humanist Party (PUR) on 3 January threatened to sue the government if it nominates an ethnic Hungarian as county prefect, Mediafax reported. Junior coalition member Hungarian Democratic Federation of Romania (UDMR) is demanding that members of the Hungarian minority be appointed prefects in Covasna (where ethnic Hungarians are in majority), as well as in Bistrita-Nasaud, Maramures and Arad counties, which have substantial ethnic Hungarian minorities. The UDMR is also asking for the position of deputy-prefect in seven other counties with either a Hungarian plurality (Harghita) or a significant minority (Bihor, Brasov, Hunedoara, Mures, Satu-Mare, and Salaj), according to UDMR Senator Gyorgy Frunda. The Covasna County branches of the three ethnic Romanian governmental parties said they will disband their local organizations if an ethnic Hungarian becomes county prefect, and their leaders vowed to resign from their respective parties in that event. MS

NEW FOREIGN MINISTER SAYS EU, U.S. MUST TAKE ROMANIAN INTERESTS IN TRANSDNIESTER INTO ACCOUNT
New Romanian Foreign Minister Mihai Traian Ungureanu said on 3 January that his country expects the European Union and the United States to take into account Bucharest's interests in attempting to resolve the Transdniester conflict, Mediafax and Flux reported. Ungureanu said that Romania hopes the two countries will "continue to demonstrate an interest in reaching a solution that will reflect not only the interests of the EU, but also those of Romania, which is to become the EU's eastern border." He said Romania hopes 2005 will prove to be "decisive" in finding a resolution to the conflict, adding, "We are following internal developments in Moldova and shall make our decisions depending on those developments." Moldova is to hold parliamentary elections this year. MS

MOLDOVA READY TO RESUME NEGOTIATIONS WITH TIRASPOL IF EU, U.S. JOIN AS 'PERMANENT OBSERVERS'
Reintegration Minister Vasilii Sova said on 30 December in an interview with the official "Nezavisimaya Moldova" that his country is ready to resume negotiations with Tiraspol if the EU and the United States are granted the status of permanent observers in the discussions, ITAR-TASS reported. "If the proposal is approved by the current participants in the [five-sided] negotiations [Russia, Ukraine, the Organization for Security and Cooperation in Europe, and the two belligerents]," the format of the negotiations can be safeguarded, Sova said. Moldova pulled out of the negotiations in August, saying the five-sided format has repeatedly led to a dead end. MS

BELARUSIAN OPPOSITIONIST SENT TO PRISON FOR THEFT
The Minsk District Court on 30 December sentenced Belarusian opposition politician Mikhail Marynich, 64, to five years in a high-security prison and confiscation of property. The court found him guilty of misappropriating office equipment that the Dzelavaya Initsyyatyva (Business Initiative) association, of which he was chairman, had received from the U.S. Embassy in Minsk for temporary use. Marynich told the court in his final statement the day before that the case against him was "fabricated by the KGB following an order from the authorities." According to Marynich, the court sentenced him to prevent him from participating in the 2006 presidential election. Marynich's lawyers have announced that they will appeal the verdict.

Marynich was arrested on 26 April, two days after he was stopped by traffic police and his suitcase searched by a KGB officer who immediately appeared on the scene. The officer reportedly found $90,000 in Marynich's suitcase. According to Belarusian Television, Marynich confessed that the money came from Russia and was to have been spent on financing "selected candidates" in the 2004 legislative election. However, the KGB apparently found nothing criminal in the possession of such a sum by Marynich, since on 6 May he was formally charged only with illegal possession of classified government documents and an unregistered foreign-made pistol that was found at his dacha. Marynich maintained during the investigation that the pistol was planted by the KGB while the documents were not classified. The charge of theft was added by investigators in August.

Marynich belongs to the "old nomenklatura" in Belarus -- a group of public figures that started their political careers in the era before Belarusian President Alyaksandr Lukashenka, during the rule of Prime Minister Vyacheslau Kebich. Under Lukashenka, Marynich was minister of foreign economic relations (1994-98) and afterward became Belarusian ambassador to Latvia, Estonia, and Finland. In mid-2001, Marynich resigned his ambassadorial post to challenge Lukashenka in that fall's presidential election. In his resignation letter to then Foreign Minister Mikhail Khvastou, Marynich reportedly said that he planned to work against dictatorship and toward democratic changes.

Lukashenka reacted furiously to Marynich's defection. "Don't you remember [when] you sang me songs and swore allegiance and loyalty?" Lukashenka said in reference to Marynich in the 2001 election campaign. Marynich did not manage to get on the ballot after the Central Election Commission ruled that he failed to collect the 100,000 signatures necessary for registration. Marynich insisted that he had gathered the necessary signatures and accused the Lukashenka government of forcing him out of the presidential race.

Eventually, the court held up only one charge against Marynich -- namely, that he stole office equipment from the organization he chaired -- and sentenced him to five years in prison plus the confiscation of his property, including the formerly seized $90,000. Marynich told the court that the trial was a brazen mockery of justice and argued that he had no intention of stealing the office equipment in question, which was temporarily stored in a garage of his son only because the Business Initiative association had been deprived of its office in Minsk.

It is noteworthy that the court ignored repeated statements from the U.S. Embassy in Minsk, which was the legal owner of the equipment allegedly stolen by Marynich, that it had no claims whatsoever against Marynich. U.S. State Department spokesman Richard Boucher on 30 December condemned the conviction of Marynich on what he called "a spurious charge," linking the sentence handed down to the opposition politician to the Belarusian government's campaign to crack down on its opponents. "The United States condemns this abuse and earlier abuses of the judicial system by the Lukashenka regime to persecute Belarusian citizens for their political beliefs," Boucher added.

Many Belarusian independent observers and opposition politicians have also condemned the sentence on Marynich as the harsh and cruel retribution of the ruling regime against a politician who once dared to challenge it politically. "This is nothing new in our state," said former Prime Minister Mikhail Chyhir, who himself spent five months in prison under Lukashenka in 1999 and subsequently received a three-year suspended prison term on charges widely believed to have been politically motivated. "Unfortunately, I think Marynich's appeals will have little effect with the higher courts," Chyhir added.

"The regime is afraid of politicians who could present a personal alternative to Lukashenka," Youth Front leader Pavel Sevyarynets commented. "The regime wants to intimidate [such politicians] with the Marynich case. Five years of prison for Marynich is like another five years of Lukashenka's presidency after he is reelected in 2005 or 2006. It is a signal for the entire society."

ONE KILLED IN PAKISTAN-AFGHANISTAN BORDER SKIRMISH
A Pakistani paramilitary was killed in an exchange of gunfire with Afghan militiamen on 2 January along the border with Pakistan's North Waziristan Province, Islamabad daily "The News" reported on 3 January. Major General Shaukat Sultan, chief spokesman for the Pakistani Army, said Islamabad was not "sure who fired from the Afghan side, but naturally this could be miscreants" -- an apparent reference to neo-Taliban and Al-Qaeda, AFP reported on 3 January. Pakistan has asked coalition forces that are active in the Afghan side of the border to launch an investigation to "find out who fired from their side," Sultan added. According to Sultan, three Pakistani paramilitaries were injured in the incident. General Khialbaz, commander of the militia forces in Khost Province in Afghanistan, said that on 2 January he received reports indicating Pakistani troops were moving toward the Afghan border, and therefore ordered his "troops to prepare their equipment and go toward the border," AP reported on 3 January. According to Khialbaz, after several artillery rounds hit the Afghan side of the border, his side "gave the same answer by mortar." An Afghan Defense Ministry spokesman said that he was unaware of any skirmish between Afghan and Pakistani forces. Coalition forces often work with militia forces in Afghanistan, including the one commanded by Khialbaz. AT

AFGHAN MILITIA COMMANDER, U.S. SOLIDER KILLED IN WESTERN AFGHANISTAN
Dost Mohammad, security commander of Herat Province's Shindand District, and a U.S. solider were killed on 2 January during a search operation, Peshawar-based Afghan Islamic Press (AIP) reported. According to eyewitnesses, fighting began when Dost Mohammad opened fire on U.S. forces seeking to search his home. According to the report, Dost Mohammad was an ally of former Herat Governor and current Energy Minister Mohammad Ismail Khan. Reuters on 2 January reported that a U.S. solider and "an Afghan citizen" were killed in the incident, without identifying who the Afghan was. AT

NEO-TALIBAN CLAIM RESPONSIBILITY FOR ATTACK THAT KILLED U.S. SOLIDER IN EASTERN AFGHANISTAN
A U.S. solider was killed and three others wounded on 3 January during a clash with unidentified militants in Konar Province, international news agencies reported. Mofti Latifollah Hakimi, purporting to speak on behalf of the neo-Taliban, told AIP on 3 January that the militia attacked U.S. forces in Konar with light artillery and mortars. Hakimi claimed four U.S. soldiers were killed. AT

WARLORD, DEMONSTRATORS IN NORTHERN AFGHANISTAN DISAPPOINTED WITH NEW CABINET
General Abdul Rashid Dostum, leader of the Junbish-e Melli party, on 3 January expressed his disappointment with the new cabinet chosen by President Hamid Karzai, Jowzjan Aina Television reported (see "RFE/RL Afghanistan Report," 23 and 30 December 2004). Dostum said that people in northern Afghanistan who "took active part in the fight against terrorism...had high expectations from Hamid Karzai." However, he said, "those expectations changed to disappointment after the announcement of the new cabinet." Dostum said "fairness and equality" are not "reflected in the new cabinet," nor is the role of people from northern Afghanistan. On 1 January, an unknown number of "public representatives" from northern Faryab, Jowzjan, Balkh, Sar-e Pol, Samangan, Baghlan, Konduz and Takhar provinces gathered in Mazar-e Sharif, the capital of Balkh Province, to express their objections to the composition of the new Afghan cabinet, Jowzjan Aina Television reported. The rally called for a review of the new cabinet and recommended the inclusion of "the entire nation living" in Afghanistan, as well as those "who fought the enemies in hard times" -- an apparent reference to anti-Soviet and anti-Taliban resistance leaders. Dostum, an ethic Uzbek, came in third in Afghanistan's presidential election with 10 percent of the vote -- a number that more or less corresponded to the percentage of ethnic Uzbeks living in Afghanistan, most of whom reside in the north of the country. AT

INTERIM SUPREME COURT FORMED IN AFGHANISTAN
Hamid Karzai on 3 January decreed the formation of an interim Supreme Court, Afghanistan Television reported. Mawlawi Fazl Hadi Shinwari remains in his position of chief justice of the nine-member court, but Deputy Chief Justice Fazel Ahmad Manawi lost his job. According to Article 160 of the Afghan Constitution, if the presidential election precedes parliamentary elections, the president must form an interim Supreme Court. AT

IRANIAN NOBEL LAUREATE SAYS SHE WILL NOT RUN FOR PRESIDENT
Nobel Peace Prize winner Shirin Ebadi has denied that she will be a candidate in the 17 June presidential election, "Sharq" reported on 3 January. "While I express my gratitude to my fellow countrymen, I declare again that I have never intended to become a government official and have never volunteered or will volunteer to run for president," Ebadi said. "Iran" newspaper, which is run by the official Islamic Republic News Agency, reported on 1 January that a number of human rights organizations, the Office for Strengthening Unity, scholars, and legal activists intend to propose Ebadi as a candidate. Emaddedin Baqi, who heads the Association for the Defense of the Rights of Prisoners, told "Sharq" of 2 January that his organization is not involved in electioneering. He said that, while the association respects Ebadi, reports that human rights organizations are backing her as a candidate are false. Although women can serve in the Iranian parliament, the wording of regulations on a presidential candidate's qualifications is vague on gender. BS

SMUGGLING OF GOODS A PROBLEM FOR IRANIAN GOVERNMENT
Police chief Mohammad Baqer Qalibaf said on 2 January that the problem of smuggling items such as automobiles and household goods into Iran is getting worse, according to Radio Farda. He said that the total value of smuggled goods is $5.5 billion-$6 billion annually, and that up to 80 percent of these goods enter the country through unregistered ports and jetties in the Persian Gulf. Radio Farda also reported on a smuggling case at Payam Airport, which is south of Karaj. The case reportedly involves some customs officials. Qalibaf attributed the prevalence of smuggling to the overall economic situation. BS

IRAQI SHI'A LEADERS VISIT TEHRAN
Muhsin Abd al-Hamid, secretary-general of the Islamic Party of Iraq, met with Expediency Council Chairman Ayatollah Ali-Akbar Hashemi-Rafsanjani in Tehran on 2 January, state television reported. Hashemi-Rafsanjani discouraged delaying the Iraqi elections planned for 30 January, and he alleged that the United States does not want to withdraw from the country. Abd al-Hamid met with Foreign Minister Kamal Kharrazi on 1 January, IRNA reported. Kharrazi said the participation of Iraqis in political affairs would hasten the foreigners' withdrawal. Kharrazi spoke out against delaying the election and said, "The Islamic Republic, despite Saddam Hussein's oppressive rule, does not accept Iraq's occupation and is against it." Kharrazi also told his guest that terrorist groups and Israel's Mossad intelligence agency are behind many of the problems in Iraq. Ayatollah Muhammad Taqi al-Mudarrisi, spiritual leader of the Islamic Action Organization, also visited Tehran, Al-Arabiyah television reported on 2 January. He said Iraqi Shi'a, Sunnis, and Kurds have an interest in running the country jointly. Until his April 2003 return to Iraq, Mudarrisi lived in Iran for 32 years. BS

IRAQI EXPATRIATES CAN VOTE IN IRAN
Deputy Interior Minister and Bureau for Aliens and Foreign Immigrants Affairs chief Ahmad Husseini said on 3 January that Iraqis resident in Iran will be able to vote in six provinces on 28-30 January, IRNA reported. The provinces are Kermanshah, Khuzestan, Khorasan, Qom, Tehran, and West Azerbaijan. Husseini said more than 200,000 Iraqi nationals are currently in Iran. They were born in Iraq but hold Iranian identification cards, he explained. Iraqis will be able to vote in Australia, Canada, Denmark, France, Germany, Iran, Jordan, the Netherlands, Sweden, Syria, Turkey, the United Arab Emirates, the United Kingdom, and the United States, AP reported on 3 January. BS

BAGHDAD GOVERNOR ASSASSINATED
Militants killed Baghdad Governor Ali Radi al-Haydari in an early morning attack on 4 January outside his home in the capital, international media reported. Al-Haydari had escaped at least one previous attempt on his life (see "RFE/RL Newsline," 10 September 2004). Al-Haydari is the most senior Iraqi official to be assassinated since the killing of rotating Governing Council President Abd al-Zahra Uthman Muhammad in May (see "RFE/RL Iraq Report," 21 May 2004). Militants have vowed in recent weeks to step up their attacks on Iraqi political leaders and politicians in an effort to thwart the elections, slated for 30 January. KR

MILITANT DETONATES TANKER TRUCK OUTSIDE GREEN ZONE IN IRAQ
A militant detonated a tanker truck laden with explosives outside the Green Zone in Baghdad on 4 January, killing at least 10 and wounding some 60 people, AP cited Interior Ministry officials as saying. The attack was carried out close to an Interior Ministry commando headquarters, according to the news agency. Eight commandos and two civilians were among the dead. The attack follows a string of incidents on 3 January across Iraq that included three car bombings and a roadside attack that claimed the lives of at least 16 people, including three U.K. nationals killed in a car bombing that targeted a U.S. security company. A U.S. national was also killed in that attack. KR

IRAQI DEFENSE MINISTER SAYS ELECTION POSTPONEMENT POSSIBLE IF SUNNIS PARTICIPATE
Interim Defense Minister Hazim al-Sha'lan proposed in Cairo on 3 January that national elections be postponed by a few weeks in order to allow Sunnis to organize should they agree to participate in elections, Al-Arabiyah television reported. Muslim Scholars Association spokesman Muthanna Harith al-Dari was asked about the proposal the same day in an interview with Al-Jazeera. He replied that the issue was not about a postponement, but about holding elections under occupation. "The postponement is indeed meaningless if the occupation remains in place," he said. "The issue is not tied to the security situation, which is one of the results of the occupation.... The issue is primarily one of occupation and must therefore be remedied through the scheduling" of a withdrawal of multinational forces. Al-Dari added that Sunni groups were scheduled to meet in Baghdad on 4 January that may address the proposal. KR

IRAQI, KURDISH PARLIAMENTARIANS DISCUSS ELECTION POSTPONEMENT
Parliamentarians from the interim National Assembly attended a joint session with Kurdish parliamentarians in Irbil on 3 January, Kurdistan Satellite television reported the same day. Kurdish representatives from both parliaments called for a postponement of Kirkuk Governorate elections due to ongoing unresolved issues in the city, including the need to implement Article 58 of the Transitional Administrative Law. The meeting also addressed proposals to postpone national elections. The majority of both parliaments agreed that instability throughout the country, a lack of voter education, and adverse conditions for candidates and voters were cause for examining a possible postponement. A Kurdistan parliamentary delegation will attend the National Assembly's next session in Baghdad during which a proposal will be made to the president and Council of Ministers to discuss a postponement, the television channel reported. KR

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