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Russia Report: June 16, 1999


16 June 1999, Volume 1, Number 16
PAN REGIONAL: BUMPS ALONG THE ROAD TO CREATION OF LARGER GOVERNORS' BLOC.
Tatarstan President Mintimer Shaimiev, the informal leader of the Vsya Rossiya (All Russia) movement, announced that talks were continuing with the Golos Rossii (Voice of Russia) over forming an alliance ahead of parliamentary elections, "Kommersant-Daily" reported on 11 June. Shaimiev said that forming an alliance with Golos Rossii "could be more beneficial than with any other coalitions or parties." However, Shaimiev rejected the possibility of an alliance with Novaya Sila (New Force), headed by former Prime Minister Sergei Kirienko, with whom Konstantin Titov, Golos Rossii's informal leader, is also conducting talks on the formation of an election alliance, according to RFE/RL's Kazan bureau. According to the daily, Shaimiev's objections to an alliance with Kirienko center on the latter's plan to run in Moscow's mayoral elections. Russian media earlier reported that Vsya Rossiya and Moscow Mayor Yurii Luzhkov's Otechestvo party were also discussing forming an election bloc (see "RFE/RL Russian Federation Report," 26 May 1999). JAC

...AS PARTIES PERFORM PURGES AT REGIONAL LEVEL.
The recent liquidation of Yabloko's Omsk branch is only one example of a pre-election purge that is taking place in almost all political parties, "Vremya MN" reported on 11 June. According to the daily, Yabloko has eliminated 10 regional branches; "Novye Izvestiya" reported earlier that 13 branches had been liquidated. The motivation for the purges is that local branches are not properly obedient to Moscow headquarters, the daily says, and in some instances get involved in local political struggles in ways that wind up discrediting the party. In Omsk, former Yabloko local leader Anatolii Babenko appeared to be making political overtures to Omsk Oblast Governor Leonid Polezhaev, an archrival of Omsk Mayor Valerii Roshchupkin. An employee of Roshchupkin's immediately formed an alternative organization called "the social movement in support of Yabloko." Moscow-based Yabloko authorities subsequently decided to pull their support from Babenko's organization and back the movement supported by Omsk's mayor. The newspaper concludes that since the regional parties generally receive neither money nor intelligence from the center, they have no incentive to think about the collective interests of their party organization. JAC

REGIONS CONTINUE TO FACE SHARP RISES AT FUEL PUMP.
Regions in Siberia continued to report sharp increases in fuel pump prices. The price for A-93 gasoline climbed 1 ruble and 10 kopeks in Krasnoyarsk Krai in a single day, Interfax-Eurasia reported on 9 June. Primorskii Krai's Economic Council, which is partly composed of leaders of the region's largest enterprises, on 9 June called on the State Duma and the Russian government to adopt a special resolution increasing subsidies to the region to compensate for the difference between existing energy tariffs and the higher tariffs demanded by EES, ITAR-TASS reported. The krai's deputy governor, Vladimir Rud, declared that an increase in energy tariffs would be the last straw "that broke the economy's back," noting that energy tariffs are already three times higher in the krai than the Russian average, according to Interfax-Eurasia the previous day. According to ITAR-TASS, energy accounts for 40 percent of local enterprises' production costs. JAC

SOROS SAYS REGIONAL DEVELOPMENT KEY TO DEMOCRACY.
U.S. financier George Soros told a conference of educators on 8 June that greater democratization in Russia will occur "only through decentralization," Reuters reported. He added that Russia's regions should see the weakness of the federal government as an opportunity to strengthen their own institutions. He also noted that some 80 percent of all universities and post-secondary institutions are located in Moscow and St. Petersburg, and now students in the regions cannot afford the trip to Moscow to pursue their studies. "That may be a good thing if the capacity of regional universities is built up," he concluded. JAC

BURYATIA: SACRED BUDDHIST TEXT TAKES DETOUR THROUGH MOSCOW.
The Atlas of Tibetan Medicine will not return to Buryatia until July--two months later than had originally been scheduled, according to ITAR-TASS on 9 June. The book, which is considered sacred by the Buddhist community, opened on exhibit at Moscow's Oriental Museum on 9 June. Last summer, news of the republican government's decision to allow the book to be sent abroad for exhibition in the U.S. caused local police to clash with protesting Buddhists and triggered an open dispute between Buryatia's President Leonid Potapov and Buddhist leader Damba Ausheev (see "RFE/RL Russian Federation Report," 8 March 1999). JAC

KALMYKIA: YABLOKO TO ASK FOR CHANGE OF VENUE IN SLAIN JOURNALIST'S MURDER CASE.
Yabloko leader Grigorii Yavlinskii told Russian Television on 7 June that his party intends to lodge an appeal to the Russian Supreme Court asking that it take over the investigation of the murder of journalist Larisa Yudina, editor of "Sovetskaya Kalmykia." Yavlinskii said that his party knows the identity of all three men responsible for Yudina's death, Sergei Vaskin, Vladimir Shanukov, and Tyurbi Baskhomdzhiev, but "the investigation does not stand a chance in Kalmykia." According to the station, all materials from an investigation by the Caucasus directorate of the General Prosecutor's office were forwarded to the Supreme Court of Kalmykia on 4 June. Citing an official at the directorate, ITAR-TASS reported that Shanukov and Vaskin will face murder charges but the criminal case against Baskhomdzhiev, former envoy of the Kalmykian president to the Volgograd Oblast, was dropped because of Bashomdzhiev's "repentance" and assistance to the murder investigation. Shanukov will be charged with actually committing the murder "with excessive cruelty." JAC

KURSK: MAYOR RE-ELECTED IN FIRST ROUND.
In voting on 6 June, incumbent Kursk Mayor Sergei Maltsev was re-elected with more than 50 percent backing, eliminating the need for a second-round of voting, "Izvestiya" reported two days later. His nearest rival, Communist Nikolai Ivanov, received less than 25 percent backing. The newspaper suggests that the Kursk municipal residents voted mainly with their purses: on the eve of the elections, pension arrears for April were paid out, while state sector employees received their holiday money and May wage simultaneously--the former alone costing the city almost 3.7 million rubles. More than half of the city's eligible voters turned out to cast their ballots (25 percent turnout was necessary for the election to be valid). JC

MORDOVIA: DEMOGRAPHIC SITUATION DETERIORATING.
In its 20 May issue, the local newspaper "Vechernii Saransk" reports that the republic has seen its population sink from 959,000 to 937,000 over the past three years. According to State Statistics Committee data, by the year 2015 the number of people living in Mordovia will fall by 12.3 percent, compared with 5.4 percent in the Russian Federation as a whole and 8.6 percent in the Volga-Vyatka Economic Region (comprising the Republics of Chuvash, Marii El, and Mordovia as well as Kirov and Nizhnii Novgorod oblasts). The newspaper notes that in Mordovia, the number of deaths is almost double the number of births. It attributes the republic's deteriorating demographic situation largely to the exodus of young, educated people to more "prosperous" regions such as Moscow, Nizhnii Novgorod, and Tatarstan. At the same time, it notes that newcomers to the republic, who are vastly outnumbered by the departees, come mainly from former Soviet republics such as Kazakhstan and Tajikistan as well as from Chechnya. JC

NIZHNII NOVGOROD: AEROFLOT SET TO TAKE OVER LOCAL AIR TRAVEL MARKET.
"The Moscow Times" reported on 5 June that Russia's national airline has struck a deal with the regional administration to establish Aeroflot-Nizhnii Novgorod, a joint venture in which Aeroflot will have a 51 percent stake. Under that deal the airline will supply the planes and crews, while the regional authorities will hand over the airport. Analysts cited by the daily predict that since Nizhnii Novgorod's only other airline is about to go bankrupt, Aeroflot will have no difficulty cornering the local air travel market. JC

NIZHNII NOVGOROD: GEARING UP FOR TAX ON IMPUTED INCOME.
As of 1 July, a single tax on imputed income will be introduced in Nizhnii Novgorod. "Vremya MN" reported on 7 June that, as in the case of other regions where the tax was introduced, protests have been staged by local businessmen opposed to the new levy. More recently, a Conciliatory Commission was formed in Nizhnii Novgorod by officials from the Mayor's Office, deputies from the city Duma, tax officials, and representatives of the general public. By 1 July, that body is to determine new coefficients that will be binding for the tax's implementation. The newspaper reported that the mayor's office is hoping that the tax will bring in some 60-80 million rubles, which will be particularly welcome following the decision earlier this year not to introduce a sales tax (see "RFE/RL Russian Federation Report," 3 March 1999). According to unofficial information cited by "Vremya MN," only 23 percent of municipal taxes are collected in Nizhnii Novgorod. JC

NIZHNII NOVGOROD: NIZHEGOROD MOTORS TO START SELLING CARS BY FEBRUARY 2000.
Nizhegorod Motors, a joint enterprise of Russia's GAZ carmaker, Italy's Fiat, and the European Bank for Reconstruction and Development, will begin selling cars in the region no later than February 2000, GAZ President Nikolai Pugin told journalists in Nizhnii Novgorod on 28 May, Interfax reported. Pugin explained that the founders of Nizhegorod Motors intend to draw up a new business plan taking into account the new economic conditions in Russia. He added that the precise date of launching sales will depend on Nizhegorod Motors' receiving subsidies from the state and on the situation of the Russian automobile market. Originally, it had been planned to begin sales at the end of this month. JC

NOVOSIBIRSK: GOVERNOR'S RACE HEATS UP EARLY.
The gubernatorial election season got off to an early start when Novosibirsk Mayor Viktor Tolokonskii officially declared on 10 June his intention to run in elections scheduled for December 1999, "Vremya MN" reported on 11 June. Another likely contender, according to the daily, is State Duma Agrarian faction leader Nikolai Kharitonov. Kharitonov's chances are considered good, but much will depend on whether the local branch of the Communist Party (KPRF) decides to back him. The leader of Novosibirisk Communists, Viktor Kuznetsov, recently announced his intention to run, and the decision of who to back--Kharitonov or Kuznetsov--will reportedly be made at the level of the KPRF's central committee. Incumbent Governor Vitalii Mukha had the communists' support during the last election, but he has subsequently switched his loyalty to Moscow Mayor Yurii Luzhkov. Mukha has the advantage of controlling five or six local television channels as well as the oblast's most influential newspapers. Another possible candidate is Duma deputy Albert Makashov, who is perhaps best known for his anti-Semitic remarks (see "RFE/RL Russian Federation Report," 1 March 1999). In addition, the Liberal Democratic Party is not excluding the possibility that its leader, Vladimir Zhirinovskii, might run in Novosibirsk if his bid for the governor's chair in Sverdlovsk Oblast fails (see End Note). JAC

NOVOSIBIRSK: NEW, IMPROVED SIBERIAN AIR CARRIER TO EMERGE.
A local airline, Sibir, is poised to merge with another domestic airline, Vnukovo, and the combined company would be several times larger than Aeroflot in terms of the volume of air traffic it handles in Russia and the CIS, "Kommersant-Daily" reported on 11 June. The new joint company will serve around 10 percent of all Russian air passengers and control no less than 40 of the existing 150 main air routes, according to the daily. According to "The Moscow Times," a merger with Vnukovo will offer Sibir access to Moscow, which it will need if it is going to become something more than a successful regional carrier. According to the daily, Novosibirsk investment companies own 75 percent of Sibir. JAC

TATARSTAN: STEPASHIN, SHAIMIEV MEET.
Tatarstan's President Mintimer Shaimiev met with Russian Prime Minister Sergei Stepashin on 9 June to discuss the political situation in the federation, Interfax reported. Shaimiev briefed Stepashin on the activities of the Vsya Rossiya bloc, which he heads. He said that Stepashin shared his concern over the possibility that falling living standards will lead to instability in the runup to the December State Duma elections. Shaimiev said that after those elections, Russia "will have to reach a civilized level" by forming a government of the parliamentary majority that would "delegate equal responsibilities for bodies of the [Russian] government and abolish the grounds for possible conflict...between them." Addressing the Federation Council the same day, Shaimiev rejected the draft federal law on the principles of power-sharing treaties between the center and federation subjects, RFE/RL's Kazan bureau reported, citing TatarInform. Shaimiev said that draft is "aimed at limiting the rights of members of the Russian Federation." LF

VOLGOGRAD: DUMA DEPUTY SEEKS RETURN OF CPSU REAL ESTATE.
"Moskovskie Novosti" reported in its 8-14 June issue that Volzhskii Mayor and Communist Party member Anatolii Shiryaev is locked in a dispute with Alevtina Aparina, first secretary of the oblast committee of the Russian Communist Party and a State Duma deputy, over the latter's proposal to seek the return of property to the USSR Communist Party (CPSU). According to the weekly, Aparina has suggested that the process begin in Volzhskii, the oblast's second-largest city, where both the executive and legislative branches are Communist-controlled. The Legal Department of the city administration is reported to be working clandestinely on the transfer of the building of the former CPSU City Committee--valued at 4.86 million rubles ($200,000)--to the Russian Communist Party, despite warnings from Shiryaev that he will dismiss all department staff. The mayor has also threatened to stop the favorable terms under which the Volzhskii party branch leases its current premises, on the grounds that many of its members are veterans of the Great Patriotic War. Aparina and her supporters, meanwhile, maintain that once the party has chalked up a success in Vlozhskii, it will extend the "experiment" to the capital of the oblast. JC

LABOR ACTION: KALININGRAD.
Air traffic controllers declared on 11 June an indefinite hunger strike to protest low wages, ITAR-TASS reported... TULA. A strike declared by 200 miners at the Belkovskaya mine in Tula Oblast to protest an almost 12-month salary backlog continued for its seventh day, ITAR-TASS reported on 7 June.

CORRUPTION WATCH: KHAKASSIA.
A military court in Krasnoyarsk sentenced the former deputy prosecutor of the city of Abakan, Dmitrii Ushanov, to three years in jail for the theft of 200 million old rubles from the wreckage of an airplane, "Kommersant-Daily" reported on 11 June... MURMANSK. The head of the department of State Tax Inspection in the city of Murmansk was arrested on suspicion of taking a bribe, regional Deputy Prosecutor Sergei Lozev told ITAR-TASS on 8 June... VOLGOGRAD. Three high ranking police officers in the Volgograd Oblast were arrested for extortion, regional prosecutors told ITAR-TASS on 9 June. A police chief and two of his subordinates in the Gordonishchenskii raion are accused of asking local businessmen to pay $3,000 to do business in the region.

END NOTE: Strange Doings in Sverdlovsk
by Julie A. Corwin

Political activity in Sverdlovsk Oblast over the past few weeks has dramatically increased from one end of the political spectrum there to the other, a development that has drawn in both national political leaders and members of local criminal groups. All of this is part of the lead up to the 29 August gubernatorial vote. And it suggests that Sverdlovsk voters are likely to be treated to a continuing spectacle as they approach that date.

Already they are witnessing the emergence of a new political group, whose members are perhaps better known to local police officers than to local election commission members. Uralmash, which recently registered as a socio-political bloc at Sverdlovsk Oblast's Justice Department and intends to participate in elections at all levels, is actually a criminal organization, according to "Nezavisimaya gazeta" and other newspapers. The group reportedly controls all copper-smelting plants in the region, hydrolytic and jewelry manufacturers, and a few large and small banks. One of its informal leaders is currently facing charges for ordering a series of contract murders. His trial, however, will not take place until after the gubernatorial elections. And in the meantime, Uralmash members are trying to create a benevolent image with their public, sponsoring a charity event for poor families on 1 June and in the spring proffering a million rubles to striking metro construction workers in Yekaterinburg.

Around the same time that Uralmash officially registered, local newspaper "Serovskii rabochii" began running a series of articles about incumbent Governor Eduard Rossel, accusing him of being the darling of Russian fascist organizations, a true Aryan, and an actual German. According to "Novye Izvestiya," one such article was reprinted in local newspapers affiliated with the movement "Our Home -- Our City," whose leader is Rossel's chief rival, Yekaterinburg Mayor Arkadii Chernetskii. Another article accusing Chernetskii of being an "agent for world zionism" was printed in the newspaper, "Russkii poryadok" which was distributed in mailboxes free of charge in one Yekaterinburg neighborhood.

The possible entry of Liberal Democratic Party (LDPR) leader Vladimir Zhirinovskii, fresh from a defeat in Belgorod Oblast elections, into the governor's race is unlikely to raise the tone of political discourse in the region. Interfax reported on 7 June that Zhirinovskii has announced that he will run for governor in both Leningrad and Sverdlovsk Oblasts. Earlier, LDPR leaders and chairman of the Duma's Geopolitics Committee Aleksei Mitrofanov said that Zhirinovskii would run only in Leningrad Oblast.

On the same day Zhirinovskii made his announcement, a newly created local workers' movement called "Mai" appealed to former Prime Minister Yevgenii Primakov to enter the race for governor. Mai's leaders, former oblast government minister Aleksandr Burkov and oblast legislative assembly deputy Anton Bakov, reportedly believe that Primakov would make a more attractive candidate than either of the two current front-runners, Rossel or Chernetskii. Primakov has not commented directly on the offer, but speaking to reporters in Switzerland on 11 June, he declined to rule out running for a political office in the future.

Despite the prospect of new competitors entering the race and a press campaign against him, Rossel seems confident of victory. He told one Moscow-based newspaper that he will be re-elected and that there is little anyone--including Russian President Boris Yeltsin--can do to stop him. Confident, even a little brash, Rossel at least appears to have the fortitude to weather the next few months--if not survive to spend another term in the governor's mansion.

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