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Poland, Belarus & Ukraine Report: October 12, 1999


12 October 1999, Volume 1, Number 20
POLAND
Will Buzek's Cabinet Survive? After several weeks of discussions, leaders of the Solidarity Electoral Action (AWS) and the Freedom Union (UW) agreed on 10 October on a new cabinet lineup and coalition rules. There was no major shake-up of Jerzy Buzek's cabinet, as some Polish political commentators had predicted. Those commentators had argued that the current government needs a radical reshuffle to reverse the dramatic decline in its popularity.

The authors of the compromise agreement seem rather uncertain about the outcome of their negotiations. Premier Jerzy Buzek of the AWS said "the most important problems have been solved" but admitted that he is worried by the "lack of cohesion of the government." Deputy Premier and Finance Minister Leszek Balcerowicz of the UW commented that his party had the choice of leaving the coalition, which would mean the destabilization of the situation in the country, or continuing cooperation with the AWS and at the same time remaining uncertain if the coalition partner will observe the signed agreement. "We opted for uncertainty," Balcerowicz said.

Some UW activists were less reserved in assessing the reached cabinet compromise. "The mountain gave birth to a mouse," Donald Tusk commented. And UW spokesman Andrzej Potocki said the compromise on continuing the current coalition is "slightly rotten."

The coalition agreed to sack Environmental Minister Jan Szyszko and Deputy Economy Minister Jan Szlazak, both of the AWS. The UW will not lose any of its ministers although the AWS pressed for the ouster of Defense Minister Janusz Onyszkiewicz and Justice Minister Hanna Suchocka. Taking into account the dismissal of Interior Minister Janusz Tomaszewski (AWS) in September and of Stanislaw Alot, head of the Social Security Agency, earlier this month, there have been only four major changes in the government since the coalition started to discuss the "restructuring" of Buzek's cabinet. Moreover, there have been no structural changes. The UW blocked the AWS proposals to create a ministry for regional development and housing and to merge the European Integration Committee with the Foreign Ministry.

The coalition partners also agreed that their parliamentary deputies will back legislation proposed by the government (a rule often broken by AWS lawmakers) and that their ministries will not publicly criticize government policies. These provisions are a strong indication of the problems within the uneasy alliance of the liberal-minded UW and the more cautious AWS, which won the 1997 elections on a ticket promising considerable relief from the market-oriented reforms implemented earlier in Poland.

However, the task of regaining the popularity that both the AWS and the UW enjoyed in 1997 would apparently involve more than simply reshaping the cabinet. September polls showed that almost 70 percent of respondents believe that Poland has taken a "wrong turn," while Buzek's cabinet has only 16 percent support. More than 30 percent opted for early parliamentary elections.

Most commentators believe that the plunge in the popularity of the AWS-UW cabinet is the direct result of its bungled performance in implementing the four major reforms--of administration, health care, pensions, and education--aimed at facilitating Poland's accession to the EU by 2003. That viewpoint may be correct, but in the long run Poles have more significant reasons for complaining.

Foreign observers frequently forget the large social costs Poles have had to pay for their country's widely acclaimed role as initiator and champion of market-oriented reforms in East and Central Europe. According to the 9 October "Polityka," 5.5 million Poles live in poverty (2 million of them in "extreme poverty"). Some 12.5 million people in Poland live in "subjective poverty" (they believe that their living standards harm their pride), and some 16.5 million people live below or at Poland's subsistence minimum.

Unemployment is another major problem: more than 2 million Poles have no jobs (12 percent of the country's workforce). Some 70 percent of them have already ceased to obtain unemployment benefits (which total up to 384 zlotys [$95] a month). Some 62 percent of Poles have completed only an eight-grade school, making it extremely different for them to find new jobs under Poland's changed economic circumstances.

These figures are alarming, and it is no wonder that the opposition Democratic Left Alliance and the Peasant Party are now pushing for early parliamentary elections, hoping to benefit from AWS-UW current unpopularity and growing disappointment with the economic situation. Radical farmers' leader Andrzej Lepper calls for a change of not only the government but the entire economic system and is threatening a "general blockade of the country" in November unless the parliament is dissolved and new elections held.

Thus, it appears that the real test for Jerzy Buzek's cabinet (no to mention Poland's drive for EU membership) has not yet begun.

BELARUS
Monetary Policy Proposed And Criticized. National Bank Chairman Pyotr Prakapovich on 4 October presented to the National Assembly a monetary policy concept for 1999-2000. Last month, the government had approved implementation of the concept.

The main goal of Belarus's new monetary policy is to stabilize the exchange rate of the Belarusian ruble. According to Prakapovich, this can be done by means of "a sliding peg of the Belarusian ruble to one or several foreign currencies," Belapan reported. On the one hand, the National Bank will ensure that the total volume of Belarusian rubles in circulation does not exceed the bank's hard currency reserves. On the other, in the "initial stage" the central bank will resort to those methods that have been used so far: limited credits and devaluation. One of the prerequisites for stabilizing the Belarusian ruble is a considerable increase in the hard currency and gold reserves of the National Bank.

Stanislau Bahdankevich, former chief banker and leader of the opposition United Civic Party, published an article in the 1 October "Narodnaya volya" saying that Prakapovich's monetary policy ideas are "stillborn plans." According to Bahdankevich, as long as the current financial and economic decision-makers remain in power, Belarus "is doomed to vegetate, the Belarusian ruble to further devalue, and the prices to increase."

Bahdankevich argues that accumulating hard currency reserves equal to the total volume of Belarusian rubles in circulation (according to him, this total amounted to $450,000 by 1 August) in no way guarantees the convertibility of the national currency. Besides, he criticizes Prakapovich's ideas on how to increase Belarus's hard currency reserves (the mandatory sale by all enterprises of 10 percent of hard currency revenues to the National Bank as well as foreign investments). According to Bahdankevich, the only realistic source of hard currency proceeds for Belarus is a positive foreign trade and payments balance. Bahdankevich argues that in order to achieve financial stabilization and attract foreign investors, Belarus must radically change its economic course.

A new economic course, according to Bahdankevich, must create a free money market in Belarus and restore the autonomy of the Central Bank. The Central Bank should introduce a market system for establishing the exchange rate of the Belarusian ruble. Prices of all kinds of commodities and services must be immediately liberalized. The government should draw up and implement a plan for canceling subsidies for utilities, electricity, public transport, and the fuel sector. All preferential taxes for economic entities should be abolished. The government should launch privatization and demonopolization. Private land ownership should become a basis for reforming the agricultural sector. In Bahdankevich's opinion, Belarus should also return to close cooperation with the IMF and other international financial organizations.

Lukashenka Reintroduces 'Board Of Honor.' In a yet another bid to make life in Belarus more closely resemble that during the Soviet era, the Belarusian president has issued an edict on the "national board of honor." According to the edict, the "national board of honor" will display the names of regions, cities, working collectives, and individuals who "fulfil projected indicators of the national economy." The edict states that the displaying of the names of regions and people on the "national board of honor" is a form of "public recognition and moral encouragement." Candidates for such an honor will be approved personally by the president (during the Soviet era, candidates were selected by the Central Committee of the Communist Party). The edict orders the presidential administration to resuscitate the old "board of honor"--a metal-concrete installation in the center of Minsk--by 1 May 2000. There is one difference, however, between the projected board and its Soviet "predecessor": Lukashenka is allowing private undertakers to aspire to the "board of honor," along with workers of state-run enterprises.

UKRAINE
Who Will Benefit From The Attack On Natalya Vitrenko? Following the grenade attack on Natalya Vitrenko on 2 October, Ukrainian media have been brimming with speculation about the motives behind the attack as well as the possible benefits and damage to Ukraine's major presidential hopefuls, particularly Leonid Kuchma, Oleksandr Moroz, and Vitrenko herself. Officially it is known that the two suspects arrested immediately after the attack are Russian citizens from Rostov who have ties to Serhiy Ivanchenko, head of Socialist Party leader Oleksandr Moroz's local election team in Kryvyy Rih, Dnipropetrovsk Oblast. The Ukrainian police has launched a search for Ivanchenko, who is suspected by the authorities to have plotted the attack on Vitrenko.

The swiftness with which official media reported the suspected perpetrators' links to Moroz prompted some commentators to assert that Kuchma has decided to take advantage of the attack in order to impair the electoral chances of Moroz, who is presumed to be his most dangerous rival in the presidential race. Kuchma himself commented that the attempt on Vitrenko's life was a "contract" attack, but he declined to say whom he suspects of ordering it.

Parliamentary speaker Oleksandr Tkachenko said that the "terrorist act against Natalya Vitrenko is advantageous only to one presidential candidate--Leonid Kuchma." He also suggested that it can be linked to "the work of the incumbent president's staff." According to Tkachenko, Kuchma wants Vitrenko to be his rival in the second round of the elections, therefore the attack was intended to boost Vitrenko's rating among the electorate. This supposition has one major flaw: the means of attack (two shrapnel grenades) in no way guaranteed that Vitrenko would remain alive for a second round of elections.

Moroz argued that the attack reflects "plans of the present regime to introduce a state of emergency and thwart the elections at any cost." He admitted that it "is absolutely disadvantageous" for him since before the attack his chances of winning the elections were "absolutely realistic." And Moroz's election staff noted in a statement that the attack was a "provocation" that is "advantageous for today's regime and its servants."

Most Ukrainian observers and commentators, meanwhile, agree that the attack will boost Vitrenko's popularity and may help her reach a runoff against Kuchma on 14 November.

Ukrainian Media Examined For Political Preferences. From 30 September to 3 October, the Kyiv-based Equal Possibilities committee, headed by Oleksandr Chekmyshev, monitored several Ukrainian media outlets to see whose side they were taking in the presidential election campaign, Interfax reported on 6 October. Incumbent President Leonid Kuchma and the so-called "Kaniv four"--an election alliance of Yevhen Marchuk, Oleksandr Moroz, Volodymyr Oliynyk, and Oleksandr Tkachenko--were mentioned most often in the media monitored.

According to the committee, the newspapers "Fakty," "Uryadovyy kuryer," "Nezavisimost," "Ukrayina moloda," "Segodnya," and "Demokratychna Ukrayina" devoted a "considerable part" of their coverage to Kuchma, whom they generally praise, and present the "Kaniv four" in a "negative light."

On the other hand, the newspapers "Silski visti," "Den," and "Holos Ukrayiny" promote the "Kaniv four" while providing almost 100 percent negative material on Kuchma.

Such newspapers as "Zerkalo nedeli," "Region," "Kievskie vedomosti," and "Kievskie novosti" devote a "relatively even" amount of coverage to Kuchma and the "Kaniv four."

The monitoring of Ukrainian nationwide television channels showed that Ukrainian Television-1, Inter, and NTU (Ukraine's Popular Television) tend to promote Kuchma, while TET, Yutar TV, and New Channel support the "Kaniv four." STB, 1+1 Channel, and Gravis are fairly impartial, devoting approximately equal time for Kuchma and his four allied rivals.

The total time devoted to Kuchma on the monitored national television channels was 8 hours and 25 minutes (including a 15-second negative report), while the "Kaniv four" received 3 hours and 41 minutes (including 23 minutes of negative coverage).

With regard to the preferences of local media, Chekmyshev said that the press and television in Poltava, Donetsk, Dnipropetrovsk, Chernivtsi, and Mykolayiv prefer to promote Kuchma, while the outlets in Odesa, Lviv, Crimea, and Kharkiv give relatively equal coverage to Kuchma and his four rivals.

QUOTES OF THE WEEK
"Today [we need] to change not the government but the whole system. Communism and capitalism in its current form have not proven themselves. [We need] a third political force that will be an alternative to the Solidarity Electoral Action and the Democratic Left Alliance." -- Radical farmers' leader Andrzej Lepper on 5 October, quoted by PAP.

"I, in jail, have bestial living conditions. But you at large have bestial morals." -- Former Belarusian Agricultural Minister Vasil Lyavonau, who was jailed on an 1997 order issued by Lukashenka, in an open letter to his ex-colleagues in the Lukashenka administration; quoted by the 7 October "Narodnaya volya."

"Only a few." -- Belarusian lawyer Vera Stremkouskaya, who was awarded the German Association of Judges' human rights prize in Karlsruhe on 4 October, answering the question of how many lawyers in Belarus are keen to ensure that the law is respected. Quoted by "Frankfurter Rundschau" on 5 October.

"With regard to various nationwide discussions about the unification [with Russia] in Belarus, they are absurd today. Because the Belarusian people are deprived of the right to choose the authorities. All those rights have been usurped by Lukashenka. Therefore, the developments [in Belarus] are more and more reminiscent of a theater. In the light of occurrences in the Caucasus and the terrorist attacks in Russian cities, it is madness to advocate the unification. Of course, Lukashenka can sign some paper with Boris Yeltsin, but it will not be a document, only a piece of paper." -- Vyachaslau Siuchyk, secretary of the Belarusian Popular Front, quoted by "Belorusskaya delovaya gazeta" on 4 October.

"Our party is ready to negotiate the powers of the parliament [with the authorities]. It is not important what this body will be called. However, if [this body] is not going to have any rights, it is senseless to talk about parliamentary elections." -- Stanislau Bahdankevich, head of the opposition United Civic Party, on the planned talks between the opposition and the authorities in Belarus.

"Belarus, of course, cannot be a banana republic because it has no bananas. But it has already become a potato republic, and its Father, its autocratic Potato, has acquired unlimited possibilities for creative self-expression." -- "Izvestiya" on 8 October.

"I represent the largest threat to the existing regime as I'm carrying constructive ideas, I'm showing what the country should do." -- Progressive Socialist Party leader Natalya Vitrenko, commenting on the 2 October attempt on her life, quoted by AP on 5 October.

"I don't want to accuse anyone and I don't want to protect anyone. But I think practically every one of [the other candidates] dreamed of removing me from the political stage. And I know practically every one of them gave instructions to members of his party and aggravated a hysteria of hatred against Natalya Vitrenko." -- Vitrenko on 6 October, quoted by an RFE/RL Kyiv correspondent.

"Even in Russia there have been no attempts to kill a candidate in all the times they've held elections--that's our know-how." -- Ukraine's former President Leonid Kravchuk, quoted by Reuters on 7 October.

"It is still unknown today who, and for what purpose, threw explosive devices at people, but it is known against whom and by whom a shoot-out is being conducted." -- Socialist Party leader Oleksandr Moroz, commenting on 5 October on the allegations that one of his election campaigners masterminded the attack on Vitrenko. Quoted by Interfax.

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