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Security Watch: February 15, 2002


15 February 2002, Volume 3, Number 6
FOREIGN POLICY
FOREIGN MINISTRY ASKS VATICAN TO REFRAIN FROM RAISING ITS PROFILE IN RUSSIA... In an official note send to the Vatican, the Russian Foreign Ministry asked the Holy See to reverse its decision to set up four Catholic dioceses in Russia (see "RFE/RL Newsline" 12 and 13 February 2002), strana.ru reported on 14 February. "Although Russia does not question the Vatican's right to organize, realization of its decision will create complications between it and the Russian Orthodox Church," said the note. Therefore, continued the Foreign Ministry, "It recommends the Vatican take no action before resolving this issue with Russian Orthodox Church."

...AS RUSSIAN ORTHODOX CHURCH ACCUSES VATICAN OF UNDERMINING ITS AUTHORITY. In its official reaction to the Vatican's decision the Synod of the Russian Orthodox Church stated that "poses a challenge the Church unheard of in Russian history," reported ORT on 13 February. It also said that by its decision the Vatican lays claim "to Russian people as its flock, at a time when the Russian people culturally, spiritually, and historically are the flock of the Russian Orthodox Church." The Synod statement also blames the Vatican for the "acute deterioration of relations between two confessions." Meanwhile, the head of the Moscow Patriarchate Foreign Relations Department, Archbishop Kirill, told RTR on 13 February that he has informed the Vatican that a visit by papal envoy Walter Kasper to Moscow planned for the end of this month is not "welcome anymore."

MOSCOW UNHAPPY WITH CIA'S EVALUATION OF RUSSIA'S LACK OF DEVOTION... Foreign Ministry spokesman Aleksandr Yakovenko said Russia has asked the U.S. for an "official explanation" of CIA Director George J. Tenet's questioning of Russia's "devotion, desire, and ability" to prevent leaks of crucial weapons technology and production methods abroad, ITAR-TASS reported. The spokesman said that the wording Tenet used in his address to the U.S. Congress on 7 February is "absolutely unacceptable" and ignores Moscow's "principled policy and practical steps to prevent proliferation of weapons of mass destruction." He added that Russia has adopted a Law on Export Control and is presently consulting with the U.S. on a new list of goods prohibited for export to Iraq.

...AND WITH JAPANESE PREMIER'S STANCE ON KURILES. Yakovenko also took offense to statements made in Tokyo on 7 February by Japanese Prime Minister Junichiro Koizumi regarding the ongoing dispute over the Kurile Islands, ITAR-TASS reported. Koizumi said that his country will sign a peace treaty with Russia only after all four of the islands are returned to Japan. The agency quoted Yakovenko as saying that as far as Russia is concerned its understanding of the dispute is different from that of the Japanese. He said Moscow's negotiations with Japan will be based on all agreements reached between the two countries after World War II -- including the Soviet-Japanese Declaration of 1956 that included a stipulation that two of the islands would be returned once a peace treaty was inked. Another basic document for Moscow is the joint declaration signed last year in Irkutsk by President Vladimir Putin and Koizumi's predecessor, Yoshiro Mori. That document formulated joint principles while preserving different interpretations by each side, Yakovenko added. Polit.ru commented the same day that "it will be difficult to deal with Koizumi as he is much more pro-American than his predecessors."

U.S.-RUSSIA GROUP DISCUSSES AFGHANISTAN, NEW THREATS. In a joint statement published after a meeting of the U.S.-Russia Working Group on Afghanistan held in Washington on 8 February, the group co-chairmen -- Russian First Deputy Foreign Minister Vyacheslav Trubnikov and U.S. Deputy Secretary of State Richard Armitage -- said they discussed the ongoing reconstruction of Afghanistan, RIA-Novosti reported the same day. Trubnikov and Armitage said that they discussed further measures to fight international terrorism, drug trafficking, and emergence of new terrorist threats in such regions as the Balkans. Finally, in their joint statement Trubnikov and Armitage said the United States has no intention of creating permanent military bases in Central Asia.

MILITARY
RUSSIAN ARMY SUFFERS FROM MASS EXODUS OF OFFICERS. Low salaries, inadequate social conditions, lack of status, and hazardous technical equipment are among the reasons for the mass exodus of officers from the Russian army, "Nezavisimaya gazeta" reported on 11 February. According to data recently released by the General Staff, every 10th medium-rank officer position is vacant and among petty officers, every third. In the last few months over 100 officers lecturing in the Ground Forces Academy have asked for dismissal from military service, and if this trend continues, the academy will have to close in six months. About 70 percent of the officers who resigned last year were 30 or younger, the newspaper noted. Another reason for leaving the army is that much military equipment is in such poor condition that it is dangerous to use it. This is especially true for the Russian air force, which received very few new aircraft and helicopters over the past decade. Today the average Russian military pilot has 15-18 times fewer flying hours than his Chinese counterpart. Since 1991, over 400,000 officers have quit military service, the paper concluded.

DEFENSE MINISTER SEES U.S. PRESENCE IN CENTRAL ASIA IN POSITIVE LIGHT... Sergei Ivanov told a press conference in Moscow on 12 February that the "presence of the U.S. and the other members" of the antiterrorist coalition on military bases in Central Asia is a positive factor for Russia," RIA-Novosti reported. "Without coordinated efforts by the participants in the international coalition, the Taliban threat could spill over Russia's borders," he added. "Afghanistan was a link in a hotbed of instability that stretched from the Philippines to Kosovo; now this link is out and terrorists throughout the whole world including Russia are no longer training in Afghanistan," Ivanov said. However, Ivanov noted that it is important that the United States and the Central Asian states abide by their promises to Russia that the presence of the antiterrorist coalition in the region is only a temporary measure, and that they will leave once the operation is finished. "Izvestiya" commented on 12 February that "if Ivanov is wrong and the bases stay, the Kremlin cannot blame anyone but itself, as it would be the price [it would have to pay] for the longstanding lack of a Russian strategy and resources adequate to the problems of the region."

...SAYS RUSSIA WILL NOT REACT IN KIND TO U.S. MILITARY BUDGET INCREASE... Ivanov said at the same press conference that while Russia shares most serious concerns about the terrorist threat and nuclear proliferation, Russia does not want to assign the "terrorist" label to particular states even if it dislikes their policies. He also said that he understands the United States' need to increase its military budget, and that Russia is "simply unable to do the same even if it wanted to." In addition, he said Russia already increased its military spending dramatically in 1999-2000 and now there are no new threats that would dictate a new increase.

RUSSIA WILL BE MAJOR ARMS SUPPLIER TO AFGHAN FORCES... Afghan Defense Minister Mohammad Fahim arrived with a big military delegation in Moscow on 10 February for a weeklong visit to hold talks with his Russian counterpart Sergei Ivanov and senior defense and security officials, Western and Russian news agencies reported. In an interview with RIA-Novosti, Fahim said that restoring his country's army based on Russian weaponry is the most economically acceptable option for Kabul. The previous Afghan army was armed with Soviet weapons and modeled on the Soviet army, and the new Afghan army will be modeled after Russia's, Fahim said.

...BUT DOES NOT WANT TO REPEAT OLD MISTAKES IN AFGHANISTAN. Speaking to journalists in Moscow on 12 February, Ivanov ruled out the direct participation of Russian military advisers in rebuilding Afghanistan's armed forces, RIA-Novosti reported. "They have been at war for 20 years -- how we can teach them to fight?" he asked. However, he said Moscow will extend its full assistance as far as weaponry and spare parts are concerned, as well as for the training of military officers in Russian academies. "Izvestiya" commented the same day that, by providing the new Afghan government with weapons, Russia is attempting to allow Kabul into Moscow's "strong political embraces.... In final judgment, the winner of the internal competition among the present Afghanistan leadership will be [the group] that has more money and weapons. The first was promised to the provisional government by Washington, and the latter is now being given by Moscow," concluded the newspaper.

GOVERNMENT AND ARMY REACH COMPROMISE ON ALTERNATIVE SERVICE. The government has reached a compromise with the military on the issue of alternative military service according to which the appropriate bill will be presented to the Duma not by the chief of the General Staff, Anatolii Kvashnin, but by Labor Minister Aleksandr Pochinok, Ekho Moskvy reported on 8 February. Pochinok's bill allows draftees to perform alternative service near the place of their residence. The bill also clearly defines the economic sectors and professions in which a draftee can opt for alternative service. Finally, the bill postulates that draftees should receive adequate salaries for their service and preserve their rights to be enrolled in higher education institutions while serving.

KREMLIN INFORMATION POLICY
RUSSIAN ORTHODOX CHURCH CREATES CLUB OF RELIGIOUS JOURNALISTS. Aleksandr Shepkov, the spokesman for the pro-Kremlin journalists association Media Union headed by Aleksandr Lyubimov, said his organization created a club of Russian Orthodox journalists as the first stage in the consolidation of reporters writing about this faith. RIA-Novosti reported on 13 February. Meanwhile, the head of the Moscow Patriarchate Publishing Department Sergei Chapnin said his Church organized this club to consolidate journalists working for 600 publications belonging to the Church. This is the first step towards creation of a unified mass media holding of the Russian Orthodox Church, he added.

NEW TV-VI JUST SOUNDS LIKE THE FIRST. Viktor Merezhko, a popular film director and TV personality, announced on 7 February that he has registered the name of a new television company that sounds identical to TV-6 but uses Roman numerals --TV-VI. The former TV-6 cofounder also said he submitted an application that the new entity be given TV-6's broadcasting frequency. Merezhko, who is known as a Putin loyalist, made his name in 1980's when he anchored the popular Soviet Television show "Cinema Panorama."

PRESS FREEDOMS GOOD, STURGEON BETTER. Speaking at the international conference "Power of Press and Pressure of Power" in Moscow, which was organized by Harvard University and Moscow State University along with the Union of Rightist Forces, Media Minister Mikhail Lesin said he "would tolerate opposition mass media in the country providing that every journalist acted responsibly." The BBC commented on 9 February that only the Western participants were serious about the topic of the conference. The spirit of the Russian side was better expressed by the head of the National Association of Broadcasters, Eduard Sagalaev, who said he "likes freedom of press, but sturgeon more," polit.ru reported on 9 February.

OLIGARCHS CONSIDER BACKING NEW TV CHANNEL. "Vedomosti" reported on 11 February that a group of Russia's most well-known oligarchs, such as MDM-Bank head Chairman Aleksandr Mamut, Siberian Aluminum head Oleg Deripaska, Unified Energy Systems head Anatolii Chubais, former Sibneft head Roman Abramovich, and former Gazprom-Media head Alfred Kokh, have agreed to invest $20 million in a bid to win the tender for TV-6's broadcasting license for TV-6 General Director Yevgenii Kiselev and his team. Yukos head Mikhail Khodorkovskii and Interros Chairman Vladimir Potanin were involved in negotiations but decided not to participate, according to the daily, because they approached the investment purely from a business point of view. According to the daily, the consortium of oligarchs was formed at the request of presidential administration head Aleksandr Voloshin. Kiselev has so far refused to comment on any negotiations regarding the tender. "Kommersant-Daily" also reported on 9 February that an oligarch consortium is being formed to bid for TV-6, but that report said the initiator was Chubais.

LIBERALS INTRODUCE PROPOSED AMENDMENT AGAINST MONOPOLIZATION OF MASS MEDIA. Boris Nemtsov, the leader of the Union of Rightist Forces, introduced in the State Duma on 12 February an amendment to the Law on Mass Media that would prohibit any single entity -- including the state -- from establishing more than one mass media outlet of the same type and profile, nns.ru reported. Nemtsov suggested that such a law should go into effect beginning next year so that all mass media outlets not currently in compliance could be by 1 January 2004.

SECURITY SERVICES
COMPUTER COUNTERINTELLIGENCE GOES PUBLIC. In his first public appearance, Dmitrii Chepchugov, the head of the Moscow Interior Ministry's department responsible for investigating cyber crimes, said that his unit along with the Federal Security Service (FSB) is playing a "computer counterintelligence" role by monitoring criminal activity on the Internet, "Nezavisimaya gazeta" reported on 8 February. He said his officers recently exposed a group of highly sophisticated hackers who sold fictitious economic rating reviews of Russian timber-export companies over the Internet. Members of the group also broke into credit card institutions' computer systems abroad, stole clients' identifications, and took money. In cooperation with their counterparts in the U.S., Canada, France, and Britain, Chepchugov's department arrested the hackers and recovered several hundred thousand dollars from them, he added.

FSB ARRESTS RUSSIAN ENGINEER FOR ESPIONAGE TO CHINA. The operational department of the FSB for Lipetsk Oblast arrested Ivan Trunov, a 65-year-old resident of the region, on suspicion of conducting industrial espionage for China, "Kommersant-Daily" reported on 8 February. According to the daily, Trunov works at the Novolipetsk metallurgical combine (NLMK), which at the end of last year concluded an agreement with a Chinese company to supply slabs. Trunov represented NLMK in the negotiations. NLMK's security director told the daily that he has information that Trunov was looking for a document that had information that was the company's intellectual property. Trunov was then put under observation and was apprehended holding some documents about the "technology for raising the quality of the slabs," which the security director said could "interest industrial circles in China." If convicted, Trunov could be sentenced to five years in prison. According to the daily, last month the FSB uncovered another attempt at industrial espionage on behalf of the U.S., Japan, and China in Omsk Oblast at the Catalyst Institute of the Siberian department of the Academy of Science.

CHEKIST CALENDAR LOST IN TIME. The FSB's calendar for 2002 features a picture of the KGB headquarters on Lubyanka Square as it looked in the Soviet era and marks many former Soviet holidays, pravda.ru reported on 6 February. The calendar, which was issued to FSB officers and was obtained by journalists from the Italian newspaper "Corriere della Sera," highlights 20 December as a day to celebrate the founding of the VChK-KGB as well as the birthday of that agency's first police chief, Felix Dzerzhinskii. The Chekist leader was born on 11 September.

LAW ENFORCEMENT
MILITARY SUPREME COURT ANNULS LIST OF STATE SECRETS, BUT PASKO AND OTHERS REMAIN IN CUSTODY. The Collegium of the Military Supreme Court favored the appeal filed by Grigorii Pasko's lawyers on 12 February, ruling out as "null and void" the Defense Ministry's list of state secrets used as the basis for sentencing the military journalist and environmentalist to four years in prison for providing such information to Japan (see "RFE/RL Newsline" 29 December 2001), Russian news agencies reported. However, the decision will not affect Pasko's fate, or others who have been imprisoned for espionage for providing information found on the list. They include: Moscow businessman Viktor Kalyagin, who was sentenced last October to 14 years' imprisonment for providing information to the United States; and scientists Igor Sutyagin (see "RFE/RL Newsline," 28 December 2001) and Vladimir Danilov (see "RFE/RL Newsline" 19 June 2001 and 7 February 2002), who are accused of divulging military secrets and espionage. Meanwhile, Naum Nim, the spokesman for a public committee in defense of Pasko, told "Izvestiya" on 12 February he cannot exclude the possibility that a new trial will be set in Pasko's case -- which in practical terms would mean an extension of his time in prison.

PUTIN SLAMS INTERIOR MINISTRY'S FAILURES AGAINST ORGANIZED CRIME... Speaking at an annual Kremlin meeting attended by most of the heads of Russia's security and law enforcement community, President Putin sharply criticized the Interior Ministry (MVD) for its failures to stem crime over the past year, Russian news agencies reported on 11 February. "As killing, kidnapping, and robbery are becoming routine occurrences in our lives, over 7,000 killers wanted by the law remain at large --as well as hundreds of thousands of other uncaught criminals," Putin said in an opening harangue that lasted for seven minutes before journalists were asked to leave. He claimed that last year the MVD failed to establish the fate of 30,000 missing Russian citizens, and stopped or suspended investigations of 40,000 criminal cases simply because police failed to establish who committed them. As a result, he said he will not support calls to drop the moratorium on the death penalty. "What is the point of making punishment more severe if we cannot provide the inevitability of punishment?" Putin asked.

...CALLS ON PROSECUTOR-GENERAL'S OFFICE TO TAKE LARGER ROLE... Putin also said that the Prosecutor-General's Office should play more of a "coordinating and preemptive role in protecting citizen's rights -- especially in the regions," Russian news agencies reported. In a nod toward human rights activists, Putin said that last year the office illegally sanctioned the arrest of 1,500 people and issued warrants for 25,000 searches. Prosecutor-General Vladimir Ustinov said in his address to the meeting that some 122,000 cases were discovered in which police concealed citizens' reports on crimes, thus stalling investigations. He said such action is patterned after the Soviet era, when the objective of law enforcement was not in protecting citizens, but in lowering crime statistics.

...AS MVD REPORTS INCREASE IN ECONOMIC CRIMES. Deputy Interior Minister Vladimir Vasiliev said at a press conference in Moscow that last year his agency investigated 382 economic crimes committed mainly by "white-collar" criminals, utro.ru reported on 10 February. Vasiliev said the biggest increase in such crimes was recorded in the area of foreign trade (up 21 percent), followed by the credit/financial sector and official corruption (both up 12 percent). He said that overall; the ministry investigated 23,000 crimes last year related to state office and civil service, including 8,000 cases of bribe taking. Vasiliev noted that Russian organized crime entities are becoming more active not only on the domestic, but also on the international level, which he said poses a threat to democracy and stability not only to Russia, but to the world as a whole. According to Vasiliev, organized crime in Russia focuses its efforts on free economic zones, foreign trade, and raw material and energy exports.

CRIME AND PUNISHMENT
HEALTH MINISTRY LOBBIES CRIMINAL PUNISHMENT FOR FAKE PRESCRIPTIONS. Deputy Health Minister Anton Katlinskii announced on 13 February that his agency will begin implementing the amendment to the Criminal Code which makes it a criminal offense to sell or distribute fake medicines, "Kommersant-Daily" reported. According to the amendment, the maximum punishment for distributing fake medicines is eight years in prison. Katlinskii also said that the ministry has detected on the market 200 cases of counterfeit prescriptions and to combat this practice has created a special unit responsible for market monitoring. The unit, State Pharmaceutical Inspection, will also be in charge of quality control of imported medicines, Katlinskii added.

DUMA STRENGTHENS RESPONSIBILITY FOR ECONOMIC CRIMES ON EQUITIES MARKET. The State Duma approved in the final reading the amendment to the Criminal Code increasing legal responsibility for abuse of investment information on the securities market, ITAR-TASS reported on 8 February. According to the amendment, the release to the public of any type of intentionally distorted information on securities would be punishable by financial penalties of up to 700 minimal salaries, or by prison sentences of up to two years.

GAZPROM INITIATES BANKRUPTCY OF SIBUR. Aleksandr Ryazanov, the deputy chairman of Gazprom's board of directors, announced on 11 February that his concern will initiate bankruptcy procedures for its affiliate Sibur (see "RFE/RL Newsline," 22, 25, and 30 January 2002), "as it is the only way to get back its assets," Russian business news agencies quoted him as saying. Gazprom's goal is to recover some 29 billion rubles ($967 million) that it invested in Sibur, Ryazanov added. He also noted that he views the criminal investigation initiated by Gazprom against Sibur head Yakov Goldovskii and his deputy Nikolai Koshits as justified (see "RFE/RL Newsline," 1 February 2002). "Goldovskii is himself to blame, as he did not want to cooperate, or make compromises," Ryazanov said.

POLITICAL ECONOMY
RUSSIAN PRESIDENT SAYS RUSSIA WILL PURSUE INDEPENDENT OIL STRATEGY. In an interview with Putin published by "The Wall Street Journal" on 11 February and posted on president.kremlin.ru, the Russian president said he considers $20-$25 per barrel to be the optimal oil price range for Russia. He did not specify which type of crude he was referring to. Until an oil glut last fall led to production cuts, OPEC targeted a $22-$28 price range for its mixed-blend crude. Putin explained that for Russia, problems result not only from low global oil prices, but also from high prices, "as they may generate too large an inflow of hard currency in our economy [and pose an inflationary risk]." While Russia continues to cooperate with OPEC, it is pursuing a strategy that preserves its independence and looks out for its own self-interests, Putin added. Global oil prices slipped slightly on 11 February in the wake of Putin's announcement and hover at around $20 per barrel for March delivery. Meanwhile, despite Russia's agreement with OPEC to cut oil production by 150,000 barrels a day during the first three months of this year, "Vedomosti" reported on 11 February that Russia is resuming oil exports to Southeast Asia for the first time in five years.

PREMIER ANNOUNCES ADVENT OF 'REFORMS OF SECOND GENERATION'... Speaking to senior officials of the Property Relations Ministry on 12 February, Prime Minister Mikhail Kasyanov said that his government is about to launch a "second generation of reforms" through the restructuring of the economy, Prime-TASS reported. One of the tools of this reform will be to transfer inefficient state property assets into the hands of small and medium-sized businesses. In contrast to the past, he said, the next phase of privatization must avoid simply redistributing state property, and strictly follow the provisions of privatization legislation and be controlled through Russia's registry for state assets. The Property Relations Ministry must also be a driving force in removing state control from the banking sector, Kasyanov continued. And while withdrawing its control over bank capital, the state must ensure that the privatization of bank and credit institutions is maximally transparent, he warned. Finally, the ministry must play the key role in land reform, and in doing so the ministry should unite into a single system the different legislation and legal norms that have been adopted at federal and regional levels for that purpose, Kasyanov said.

...AND REVIVAL OF PRIVATIZATION. Prime Minister Kasyanov announced at a meeting of his government on 7 February that he will push ahead the program of reorganization and privatization of inefficient state enterprises that has been suspended for the last few years, RBK reported. He said that, as far as privatization is concerned, the first priority is the banking sector, where the government wants to sell its stake in more than 400 credit institutions. Overall, the government plans to put 150 enterprises and 426 holdings on the trading block. Among those earmarked for sale are Slavneft and the state share in LUKoil. Other attractive offers will be the Mosfilm and Lenfilm studios, according to Kasyanov.

ECONOMIC DEVELOPMENT MINISTRY OUTLINES MICROECONOMIC STABILIZATION MEASURES... Addressing the same government sitting, Deputy Economic Development and Trade Minister Arkadii Dvorkovich said that his agency has prepared a plan for ensuring the stabilization of the economy based on the coordination of budgetary and financial and credit policies, RBK reported on 7 February. The plan contains measures to reduce inflation through the buildup of a financial reserve and through a tight budget expenditure policy. Other measures include the introduction of clearly defined tariff policies for natural monopolies, and the elimination of all forms of barters. In addition, incentives to increase the use of credit cards and energy-saving technologies will be created.

...AND PLANS TO REFORM COMMUNAL SERVICES. "Kommersant-Daily" reported on 12 February that Economic Development and Trade Minister German Gref said that in the next six months his ministry will introduce a comprehensive market-oriented reform of communal services based on social differentiation and incomes. Initially the government planned to introduce an across-the-board measure that would require citizens to pay 100 percent of their communal utilities costs; however, following President Putin's intervention the government decided that only families with higher incomes should pay the costs in entirety. As for poor families, the utilities costs will be subsidized by the state through municipal budgets, according to Gref. He added that the infrastructure of communal services in Russian cities today is in a miserable state, as 60 percent of it is obsolete and inadequate, and that the reforms are aimed at making the sector self-sufficient and able to provide funding for their upkeep.

RUSSIAN INFLATION RATE TWO TIMES HIGHER THAN EXPECTED. The optimistic prognosis made by the government at the beginning of the year concerning the reduction of Russia's inflation rate from 18 percent to 12-14 percent was groundless and will certainly be revised upward based on January's economic indicators, "Ekspert," No. 6, reported. The monthly said that the rise in inflation in January was stimulated by the increase of utilities tariffs by up to 150 percent in some cases. Meanwhile "Kommersant-Daily" wrote on 8 February that inflation in January reached 30 percent, and that Prime Minister Kasyanov privately asked the mass media not to circulate the news in order to prevent the "wrong interpretation" of the situation.

YUKOS HEAD TELLS PREMIER TO LIBERALIZE GAS AND OIL MARKET. Mikhail Khodorkovskii, the head of the Russian oil giant Yukos, told journalists on 12 February that his company seeks to end Gazprom's monopoly of the Russian gas market and become the country's largest exporter of natural gas by 2005, RBK news agency reported. Khodorkovskii said such ambitions are realistic because today it is not Gazprom but the state that is the true monopolist, as the government controls the export pipelines. Khodorkovskii added that such a situation cannot last for long, and that eventually the government must either liberalize and deregulate the gas and oil market -- including access to the export pipelines -- or some big petrochemical companies will begin to die. And he added, "[Premier] Kasyanov knows that if oil companies experience an economic catastrophe, his government will not survive it."

DOMESTIC POLICY
RUSSIAN PRESIDENT MEETS WITH COMMUNIST PARTY LEADER... Vladimir Putin met with Communist Party of the Russian Federation (KPRF) head Gennadii Zyuganov on 7 February to discuss "legislative work in the Duma," Russian agencies reported, citing the presidential press service. It was the first meeting between the two leaders since Zyuganov described the president's policies as the "third stage of treason of national interests after Mikhail Gorbachev and Boris Yeltsin" at the last KPRF congress (see "RFE/RL Newsline," 24 January 2002).

...TO DEFUSE KPRF'S CALLS FOR INVESTIGATION OF EES? According to gazeta.ru on 6 February, the KPRF began collecting signatures in the State Duma the same day in support of a request that the Audit Chamber investigate any links that Unified Energy Systems (EES) might have with the controversial Czech Republic-based company Falkon Capital. In the fall of 2001, the Czech government sold the debt owed to it by Russia to Falkon Capital for $570 million. Since then, reports have alleged that Falkon Capital is a subsidiary of the Saudi Binladen Group, the main source of terrorist Osama bin Laden's fortune (see "RFE/RL Newsline," 15 and 16 January 2002).

ZYUGANOV SOWS NATIONALIST OATS AS NEW PARTY TAKES SHAPE. Speaking in St. Petersburg on 11 February, KPRF leader Zyuganov continued to criticize President Putin's policies, NTV reported. He called on all "peoples-patriotic forces to unite and prevent power from slipping into the hands of the junta and oligarchy." Meanwhile, Vladimir Miloserdov, a spokesman for the founding committee for the Peoples-Patriotic Party, said the inauguration congress of the new party will take place on 23 February, RosBalt reported on 11 February. "We are not concealing that the new party is created on the ruins left by the demise of the Peoples-Patriotic Union led by Zyuganov," Miloserdov said. He added that the most likely leader of the new party will be former Krasnodar Krai Governor Nikolai Kondratenko, and that the party's program includes the "restoration of independence and integrity" for Russia, as well as the suppression of ethnic conflicts.

PUTIN SEES RUSSIAN JEWISH EMIGRE COMMUNITIES AS POTENTIAL RESOURCE. President Putin met with Chief Rabbi Berl Lazar on 7 February, RTR reported. Putin noted that Jews who emigrated from Russia to Israel, the U.S., and Germany are feeling a new sense of closeness to Russia and understand that it is now an open country. Putin also told Lazar that Russia views Russian Jewish emigre communities abroad as a future resource of "great economic potential," and at the same time the Russian government is ready to "to address Jewish communities' concerns and to help them."

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