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Tatar-Bashkir Report: April 13, 2000


13 April 2000
WEEKLY REVIEW FROM TATARSTAN
Republics Get Ready To Amend Legislation Mutually With Federal Center
A government working commission to amend the Constitution of Bashkortostan Republic adopted in December 1993 was established in early April, 2000. The commission head, Bashkortostan State Secretary Ildus Adigamov, said on 8 April that this move "did not signify neither the major changes in principles ruling relations between federal center and the republic nor the automatic replacement of regional legislation with federal laws." In his words, the commission has already begun amending the laws of Bashkortostan and preparing proposals to federal governmental bodies on amendments to the federal laws, including the Constitution of Russian Federation. Previously, Bashkir President Murtaza Rakhimov, had stated that Russia ought to follow the example of Germany and the United States, where every land and state had its own judicial system.

In an April 7 interview with "Russian Kommersant Daily".the President of the Tatarstan Republic Mintimer Shaimiev, had said that the republic's laws would "be amended with over time, but we have to bear in mind that the Russian constitution reflects the asymmetric structure [of the Russian Federation] - republics in the Russian Federation are marked as states, while other Russian Federation entities are not. One should create a conciliation commission to develop principles and procedures to bring our legislation in accordance with the Russian Constitution. But this process cannot be carried out bilaterally."

TR Automotive Giant (KamAZ) Receives Major EBRD Loan
The European Bank of Reconstruction and Development (EBRD) agreed to convert half of $141 million debt of the KamAZ automotive company of Tatarstan, news agencies reported earlier this week. This EBRD decision, of KamAZ allegedly most strict creditor, will bail the plant out of bankruptcy and complete the restructuring of the KamAZ total debt of about $1 billion. In August 1995, the KamAZ automotive company in Chally, Tatarstan, was granted a $100-million EBRD loan. The EBRD loan to KamAZ was the first to be given directly to an industrial enterprise of the former USSR without going through the government.

Loan preparation took about a year; EBRD representatives reportedly inspected all KamAZ workshops, and studied the Russian and CIS operations of KamAZ dealerships. As a result, the EBRD -- unlike the Russian Vneshtorgbank which had previously granted the company a $150 million credit -- was not satisfied with the verbal guarantees of the American KKR management company working with KamAZ. The EBRD insisted that the loan could only be granted using as collateral all KamAZ property, including future equipment, land, reserves of raw material and ready-to-sell production.

KamAZ announced it would begin its debt restructuring program in 1997 "due to constant financial difficulties," while KamAZ creditors offered to convert debts into company shares. The EBRD stipulated it would remain a special status creditor, getting "money, not shares."

The EBRD sued KamAZ at the International Tribunal (London), when KamAZ refused to sell its equipment to pay off the loan. KamAZ filed a suit against the bank, claiming that the EBRD loan agreement violated the rights of other creditors. KamAZ lawyers insisted that KamAZ former general director, Nikolay Bekh, had exceeded his authority in signing this agreement. Experts cite several factors in the altered EBRD policy towards KamAZ -- growing profits at the heavy trucks plant, the recent boost in company sales, and the recent election of the Russian Economics Minister, Andrey Shapovalyants -- the EBRD-appointed manager of KamAZ -- as the chairman of the KamAZ board of directors.

The EBRD reportedly agreed to convert half of the KamAZ debt into shares on the condition that Russian government would guarantee the repayment of the other half within the next 12 years. The restructuring program is to be prepared by 15 July, 2000.

Moslem Expert Board To Control Religious Printing In Tatarstan
The Moslem Spiritual Board [MSB] of Tatarstan Republic announced on 13 April that it would organize an Expert Board on Moslem printed media in TR. MSB chairman Gusman khazrat Iskhaki stated the same day that the Expert Board would function "based on Moslem Sharia law, Russian Federation and TR legislation". Moslem leaders and Tatar Islamic scholars will reportedly be entered to the board for "amending the logical and grammatical mistakes in Moslem literature privately distributed in Tatarstan." Expert Board will be headed by Jalil khazrat Fazleev, the Imam-mukhtasib of the TR Baltach region, who graduated from the Moslem religious mardasah [school]and Financial-Economic Institute in Kazan.

Tatarstan To Promote Its Helicopters In Vietnam
The Tatarstan government (TR) issued an April 11 decree to establish its trade representation in Vietnam. The TR has already opened 17 representation offices in the Russian Federation, Kazakhstan, France, Turkey, Australia, Finland, Cuba, Cyprus, Ukraine, USA, Czech and Slovak Republics, Azerbayjan and Uzbekistan. The Socialist Republic of Vietnam is 19th on the list of Tatarstan's active trade partners. Annual exports from Tatarstan include helicopters ($8 million), heavy trucks and spare parts (over $1,4 million) and polymer materials ($153 thousand).

The TR declared that the new representation's goal will be to promote Tatarstan's products in Asian markets. Rinat Ibragimov, 44, official of the republican agency for international relations, will head the Hanoi representation.

Bankrupt Photo Film Producer Gets Order From The Military
News agencies reported on 11 April that the Tasma photo film company in Kazan is developing its aerial photography film production capacities. Tasma is the only company in Russian Federation with such capacity. According to the manager of bankrupt company Damir Muratov, a purchase from the Russian military enabled 10,8 million rubles in wage arrears for 1997-1998 to be paid to company employees.

Compiled by Iskender Nurmi.

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