YELTSIN BEGINS STATE VISIT TO SWEDEN...
President Boris Yeltsin arrived in Sweden on 2 December for a three- day state visit. Talks are expected to focus on bilateral relations and confidence-building measures in the Baltic region, ITAR-TASS reported. In comments to Russian and foreign reporters the previous day, Yeltsin said his trip to Sweden aims to bring bilateral relations to a "new level of understanding and cooperation." He noted that Russia welcomes Sweden's help in normalizing relations with the Baltic countries. Yeltsin also commented that Russia has "a sincere interest" in developing good-neighborly relations with the Baltic States but that the stumbling block in dealing with Latvia and Estonia is the situation of the Russian-speaking population there. JG
...CALLS FOR BOOSTING BILATERAL TRADE, INVESTMENTS
Yeltsin also urged Swedish businessmen to step up trade with Russia and to invest more in the Russian economy. Swedish businessmen should not be afraid of "Russian bureaucracy, corruption, and the so-called Russian mafia," he commented, adding that the scale of such problems has been "strongly exaggerated." Yeltsin also said a "solid package" of agreements will be signed during his visit to Stockholm, specifically mentioning an agreement on restructuring the former Soviet Union's debt to Sweden. The Russian Ministry for Foreign Economic Relations released statistics on 1 December showing trade between Russia and Sweden could reach $2 billion this year, AFP reported. JG
U.S. CITIZEN DETAINED ON SUSPICION OF SPYING
A spokesman for the Russian Federal Security Service (FSB) said on 1 December that a U.S. citizen has been detained in Rostov Oblast on suspicion of spying, Russian news agencies reported. The spokesman said Richard Bliss was detained on 25 November after he had been found taking land surveys of "sensitive sites" using satellite transmitters that are not allowed to be brought into Russia. Meanwhile, Richard Hoagland, a spokesman for the U.S. embassy in Moscow, said two U.S. businessmen were detained for questioning by the Rostov authorities on 25 November. Hoagland said one of the men has been released and the other is still in detention. State Department spokesman James Rubin said in Washington that Bliss works for a U.S. telecommunications company that is setting up a mobile telephone network in Russia. JG
ZYUGANOV AGAIN CRITICIZES GOVERNMENT AHEAD OF BUDGET DEBATE
Communist Party leader Gennadii Zyuganov on 1 December renewed criticism of the government over Yeltsin's decision to put off a meeting, scheduled for the same day, at which the cabinet was to report on its economic performance to date, ITAR-TASS and Interfax reported. Earlier, Yeltsin had threatened that some ministers might be dismissed after he had heard the government's report. Zyuganov told a news conference in Moscow that the meeting was put off to avoid criticism of the government shortly before the 5 December parliamentary debate on the budget. Zyuganov accused the government of continuing "its ruinous economic policy" and said Communist Duma deputies will meet on 2 December to discuss their position on the budget. But State Duma Speaker Gennadii Seleznev, also a Communist, said later the same day that prospects for the budget debate are "in no way linked" to the postponement of the meeting, ITAR- TASS reported. JG
DISAGREEMENT OVER YELTSIN'S PLANNED CHECHEN VISIT CONTINUES
Russian Presidential Press spokesman Sergei Yastrzhembskii on 1 December reiterated that Yeltsin's planned visit to Chechnya in January will not have the status of a state visit, given that Chechnya "was, is and will be" part of the Russian Federation, Russian agencies reported. Chechen officials, including President Aslan Maskhadov, want the visit to take place in accordance with international diplomatic protocol. Maskhadov spokesman Kazbek Khazdhiev said on 30 November that Grozny may not ban the visit unless it takes place on those terms. LF
PRIMAKOV MEETS WITH BULGARIAN COUNTERPART
Following a meeting with his Bulgarian counterpart, Nadezhda Mikhailova, in Moscow on 1 December, Foreign Minister Yevgenii Primakov, said relations between Moscow and Sofia are "good, normal, and have good prospects for development," ITAR-TASS reported. He noted that while there are no "splits" or "antagonistic" feelings between the two countries, differences of opinion exist, including over NATO expansion. Mikhailova said her talks with Primakov were very useful and will serve as a "good basis for further cooperation." Mikhailova was in Moscow also to help prepare for Bulgarian President Petar Stoyanov's visit to Moscow on 19-20 December. JG
RUSSIAN, UKRAINIAN TREATY TO BE RATIFIED BY YEAR'S END?
Duma speaker Seleznev and his Ukrainian counterpart, Oleksandr Moroz, said after their meeting in Moscow on 1 December that they hope their parliaments will ratify a bilateral friendship treaty by the end of this year, ITAR-TASS reported. That treaty was signed by Yeltsin and Ukrainian President Leonid Kuchma in May 1997. Moroz said that "a synchronized ratification" of the treaty will strengthen the authority of Ukrainian lawmakers ahead of Ukraine's March parliamentary elections. Georgii Tikhonov, the chairman of the Duma Committee for the CIS and Relations with Russians Abroad, noted on 1 December that the status of the Russian language in Ukraine may become a bone of contention during ratification discussions. But Moroz argued that "there are no problems with the use of the Russian language in Ukraine." JG
GROWING NUMBER OF DRUG ADDICTS, ALCOHOL- RELATED DEATHS
Nikolai Ivanets, the head of the Health Ministry's Narcotics Center, has said the number of drug addicts in Russia grew by 34 percent so far this year, ITAR-TASS reported on 28 November. Ivanets said most of the new drug addicts are between 15 and 20 years old. Officials say alcohol-related deaths also are increasing. Boris Tereshenko, head of the Interior Ministry's economic crimes department, said the previous day some 43,000 Russians have died this year from drinking low-quality vodka. JG
PRELIMINARY RESULTS FROM KAMCHATKA REGIONAL ELECTIONS
Preliminary returns from the 30 November elections to the Kamchatka Regional Council of People's Deputies show that 46 out of the 49 council seats have been filled, ITAR-TASS reported on 1 December. No single political party won clear majority in the vote. Electoral authorities said the results of the vote in the Koryak autonomous district, which has three seats in the regional council, are still unclear due to the lack of communications with communities in remote areas. JG
TRETYAKOV GALLERY DIRECTOR ASKS FOR FINANCIAL ASSISTANCE
The director of Moscow's prestigious Tretyakov Gallery has asked Finance Minister Mikhail Zadornov for an emergency meeting to discuss the museum's financial problems, ITAR-TASS reported on 1 December. Valentin Rodionov said that the Interior Ministry had withdrawn several of its guards working at the gallery because of unpaid wages. Rodionov said the ministry had warned in a 28 November letter that unless back wages are paid, the unit providing security to the museum would be substantially downsized. The gallery owes a total of some $1 million in back wages to the guards. JG
TAJIK OUTLAW LEADER KILLED IN SHOOT-OUT
Rezvon Sadirov, one of the leaders of a group that has taken several hostages since December 1996, was killed on 2 December, RFE/RL correspondents in the Tajik capital reported. Sadirov and some 40 of his supporters were surrounded by Tajik government security forces in a Dushanbe suburb but refused to surrender. The total number of casualties in the shoot-out that followed has not yet been released. The Security Ministry said a large number of weapons and narcotics were found at the scene. Sadirov's gang kidnapped two French citizens on 18 November and demanded the release of Rezvon's brother, Bahrom, in exchange for the hostages. However, one of the hostages was killed on 30 November (see "RFE/RL Newsline," 1 December 1997). BP
TURKMENISTAN EXTENDS OIL, GAS TENDER
The Turkmen government has extended the date for bids to explore and develop hydrocarbons in the country's section of the Caspian Sea, ITAR-TASS and Interfax reported on 1 December. The deadline was originally the end of November, but owing to "large number of applicants," the authorities have decided to continue accepting proposals until 15 February 1998. BP
GEORGIAN TERRORISM TRIAL SUSPENDED
The trial of Jaba Ioseliani and 14 members of his Mkhedrioni paramilitary formation opened in Tbilisi on 1 December amid massive security precautions. The proceedings were suspended almost immediately after the defendants loudly protested having to sit in steel cages. The defendants face charges of organizing the August 1995 assassination attempt against then parliamentary chairman Eduard Shevardnadze, banditry, and the illegal possession of arms and drugs. Ioseliani denounced the proceedings as a "show trial", while Shevardnadze said in his weekly radio broadcast that he is sure all legal and democratic norms will be observed, according to ITAR-TASS. LF
GEORGIA'S ARMENIAN POPULATION PLEDGES LOYALTY
Dzhavakhk, the organization representing Georgia's Armenian population, has issued a statement expressing its support for the Georgian government's planned measures to improve social and economic conditions in those areas of southern Georgia with a majority Armenian population, Caucasus Press reported on 1 December. Several Georgian politicians have accused Dzhavakhk of campaigning for territorial autonomy. LF
AZERBAIJANI TERRORISM SUSPECT EXTRADITED TO BAKU
Russian law enforcement agencies on 29 November extradited to Azerbaijan 30-year-old Azer Aslanov, who is charged with planting a bomb that exploded in the Baku metro in July 1994 and killed 13 people. Aslanov, who was taken prisoner by Armenians in January 1994 while serving in the Azerbaijani army, was commissioned by the Armenian security service to plant the Baku bomb, according to Turan, citing the Azerbaijani Prosecutor- General's Office. In February 1997, Azerbaijani Security Minister Namik Abbasov announced that his ministry had arrested the man responsible for an earlier Baku metro bombing. That suspect was also said to have been recruited and trained by the Armenian secret service. Armenia denied those allegations. LF
AZERBAIJANI PRESIDENT ON POLITICAL SITUATION
Heidar Aliyev on 29 November said the political situation in Azerbaijan is "more stable than ever before" and affirmed that democratic processes "are irreversible and will continue to gather strength," Interfax and Turan reported. But Aliyev also charged that unnamed members of the government are trying to distort the leadership's policies. Saying it is unacceptable for opposition parties to maintain armed formations, Aliyev condemned unnamed opposition figures for supplying information about human rights violations and prison conditions in Azerbaijan to international organizations, many of which he claimed are "financed by Armenians." Aliyev was speaking at a meeting to mark the fifth anniversary of the creation of the ruling Yeni Azerbaycan party. LF
PLANS TO GUARD CAUCASUS RAILWAY, PIPELINE
Georgia, Ukraine, and Azerbaijan will create a joint battalion to protect the Transcaucasian transport corridor, Ukrainian Defense Minister Aleksandr Kuzmuk told journalists in Kyiv on 1 December. Kuzmuk and his Georgian counterpart, Vardiko Nadibaidze, had agreed on jointly protecting the railroad through Abkhazia during Kuzmuk's recent visit to Tbilisi (see "RFE/RL Newsline," 30 October 1997). Caucasus Press on 1 December cited the independent Azerbaijani news agency ANS as reporting that if construction of the Baku-Ceyhan oil pipeline proceeds, U.S. reconnaissance aircraft currently stationed at Turkey's Incirlik air base will be deployed to protect the pipeline under an agreement between Turkey, the U.S., and Britain. LF
ARMENIAN COMMUNISTS HOLD CONGRESS
Addressing the 33rd congress of the Armenian Communist Party in Yerevan on 29-30 November, party first secretary Sergei Badalyan argued that the "so-called reforms" conducted by the country's present leadership have led to deadlock, RFE/RL's Yerevan bureau reported on 1 December. He predicted that "sooner or later" the Communists will return to power. Badalyan advocated resolving the Karabakh conflict within the framework of a revived union of former Soviet republics on the basis of the right of the region's Armenian population to self-determination. Badalyan and the other six communist parliamentary deputies had met on 27 November with Armenian President Levon Ter- Petrossyan to discuss the country's social and economic situation and constitutional reform, ITAR-TASS reported. Five leading Communists were expelled from the party in November for having joined the Union of Socialist Forces. LF
CZECH POLICE PROBE KLAUS'S ALLEGED SECRET BANK ACCOUNTS...
The Czech police on 1 December announced that an investigation is under way into media allegations that outgoing Prime Minister Vaclav Klaus's Civic Democratic Party (ODS) has secret bank accounts in Switzerland, CTK reported. According to the allegations, Czech and foreign companies paid money into the accounts in exchange for preferential treatment in privatization deals. Klaus continues to insist he knows nothing about such accounts. Meanwhile, on 1 December, the crown suffered its biggest one-day loss in almost two years (see also "End Note"). MS
...WHILE KLAUS SAYS HE'LL SEEK RE-ELECTION AS ODS LEADER
Also on 1 December, Klaus confirmed in a radio broadcast that he will seek another mandate as ODS leader at the party's extraordinary 13-14 December congress, saying he is responding to the "enormous support" voiced by party members. He also criticized Finance Minister Ivan Pilip, who had called for him to resign on 28 November. Klaus said that while he had considered Pilip to be his likely successor, the finance minister's "impatience and arrogance" ruled out such a development. Meanwhile, the doctors treating ailing President Vaclav Havel have said he should limit his work schedule, despite the political crisis in the country, CTK reported on 1 December. At the same time, they say there has been "no major change" in the president's health from the time he left hospital on 18 November. MS
UKRAINE CONTINUES TO DOWNSIZE MILITARY
Defense Minister Oleksandr Kuzmuk told a Kyiv news conference on 1 December that he will continue with downsizing the Ukrainian armed forces, cutting another 36,000 jobs by 2005. He said his ability to downsize has been limited by inadequate government support for the army and noted that he has asked the parliament to double its allocations to the military in 1998. In other comments, Kuzmuk acknowledged he has released from duty three Ukrainian officers accused of smuggling while in Bosnia. But he repeated Kyiv's insistence that the seven Ukrainian soldiers arrested in Mostar had not violated any law. He suggested those soldiers had been victims of a provocation of some kind. PG
CRIMEAN TATARS FACE OBSTACLES TO UKRAINIAN CITIZENSHIP
Refat Chubarov, the deputy speaker of the Crimean parliament, told Interfax on 29 November that Kyiv still has not lifted the chief obstacle preventing many Crimean Tatars from gaining Ukrainian citizenship. Since 1991, some 102,000 Crimean Tatars have returned to their homeland from Central Asia, to where they were deported by Stalin. But few of them have been able to prove that they have in fact renounced citizenship in the countries there, as is required by Ukrainian legislation. PG
BELARUSIAN PRESIDENT TO TAX MUSHROOM PICKERS?
The latest victims of Alyaksandr Lukashenka's efforts to extract more money from the population may be the nation's mushroom pickers, RFE/RL's Belarusian service reported on 1 December. Under orders from Lukashenka to find $200 million in additional taxes and fees, Finance Minister Mikalaj Korbut suggested Minsk may impose new taxes on private individuals who catch fish and game or gather mushrooms and berries. PG
ESTONIAN GOVERNMENT OFFERS COMPROMISE TO OPPOSITION...
In a bid to solve the deadlock over next year's budget, the government on 1 December offered the opposition a compromise whereby 109 million kroons ($7.3 million) would be allocated to finance a wage hike for teachers, ETA and BNS reported. The opposition recently pushed through a budget amendment that allocated 200 million kroons for such a hike, causing a budget imbalance. On 27 November, some 16,000 teachers staged a warning strike to demand that they receive the equivalent of the average wage. That strike was the largest in postcommunist Estonia, according to the news agency. JC
...AND REWARD FOR ARREST OF ARMS ROBBERS
Also on 1 December, the government offered a 100,000 kroon ($6,700) reward for information leading to the arrest of three men who committed one of the country's largest arms robberies in recent years, ETA reported. On the evening of 30 November, the three men entered a weapons depot outside Tallinn, tied up the only guard at the site, and absconded with some 70 Kalashnikov automatic rifles as well as a large amount of ammunition. A massive manhunt is under way, while the government crisis commission has formed a special working group to monitor developments. JC
LITHUANIAN AUTHORITIES TO INVESTIGATE MAJOR SMUGGLING CASES
The Prosecutor-General's Office and the Ministry of Internal Affairs are to set up special investigative groups to examine this year's major smuggling cases, BNS reported on 1 December. Officials implicated in such cases will be investigated for negligence or abuse of office. Prime Minister Gediminas Vagnorius proposed such a step at a meeting with Finance Minister Algirdas Semeta, Customs Department director Alvydas Budrys, and officials from the Justice Ministry and law enforcement agencies. JC
POLISH PRIMATE CRITICIZES RADICAL PRIEST
In an open letter published by the PAP news agency on 1 December, Jozef Cardinal Glemp asked the Redemptorist Fathers to impose discipline on a controversial priest who has denounced parliamentary supporters of abortion as "murderers" and refused to comply with a summons by local prosecutors. The primate said that Father Tadeusz Rydzyk, whose Radio Maryja often broadcasts nationalist rhetoric, was employing "raucous measures" in the political arena. PG
EU BANS IMPORTS OF POLISH DAIRY PRODUCTS
Following a warning that Poland's dairy plants do not maintain adequate hygiene, the EU on 1 December banned the import of dairy products from that country, PAP reported. The ban will have a significant economic impact since Poland exported some $44 million in dairy products to EU countries over the past year. But Warsaw did receive some good economic news the same day. The European Bank for Reconstruction and Development has allocated $260 million for the reform of Poland's banking and industrial sectors, "Rzeczpospolita" reported. PG
SLOVAKIA WANTS GERMAN COMPENSATION FOR WAR VICTIMS
A Foreign Ministry statement released in Bratislava on 1 December says Slovakia is "drawing attention" to the fact that Germany has so far neither compensated Slovak victims of the Holocaust nor paid compensation for "other forms of Nazi persecution" in Slovakia. The statement was released on the eve of an international conference in London that is to examine ways of speeding up compensation for Holocaust victims and is expected to focus on gold stolen from Holocaust victims and countries invaded by the Nazis. The ministry said it hoped the conference "will contribute to speeding up the compensation of victims of Nazism who had so far been overlooked," Reuters reported. MS
HUNGARIAN OPPOSITION CRITICIZES "TWIN DAM" PROPOSAL
The opposition has sharply criticized government commissioner Janos Nemcsok's proposal that Hungary build two small hydropower plants on the Danube instead of completing the original Gabcikovo-Nagymaros project. That proposal was submitted to a Slovak delegation on 24 November in Bratislava. Hungarian opposition deputies lambasted Prime Minister Gyula Horn for letting the Hungarian delegation make such proposals without the explicit authorization of the legislature. Horn, for his part, said that the "twin dam" proposal would ensure that work already completed on the project would not be wasted. He added that The Hague tribunal's ruling on the matter was neither a success nor a "fiasco" for Hungary, since a compromise with Slovakia can still be reached. MSZ
CROATIAN SOCIAL DEMOCRATS SCORE LOCAL ELECTION VICTORY
A coalition led by the Social Democrats has swept the 30 November elections in Primorsko-Goranska County, which includes Rijeka. The coalition appears set to take 29 out of 41 seats in the county legislature, while supporters of President Franjo Tudjman are likely to receive eight and the Istrian Democratic Assembly three, an RFE/RL correspondent reported from Zagreb on 1 December. The Social Democrats and their allies are also ahead in a number of municipal elections in the same region. Social Democratic leader Ivica Racan said in Rijeka that his party wants national parliamentary elections as soon as possible, "Novi List" reported. PM
CROATIAN UNIFORMS FOR SLAVONIAN POLICE
Law enforcement officers in eastern Slavonia began wearing Croatian police uniforms on 1 December, an RFE/RL correspondent reported from Vukovar. The Croatian Interior Ministry is slated to assume full control of security forces from the UN temporary administration in the region by 15 December. A two-year process of reintegrating the last Serb-held enclave of Croatia is slated to end in January. Meanwhile in Karlovac County in central Croatia, some 4,050 Serbs have returned to their homes from Serbia and eastern Slavonia since the end of the fighting in 1995, "Vjesnik" reported on 2 December. PM
UNION LEADER BLASTS CROATIAN VAT
Boris Kunst, president of the 250,000-strong Workers Trade Union, said in Zagreb on 1 December that the value-added tax due to go into effect in January will raise food prices by almost 5 percent and widen the already pronounced gap between rich and poor. A group of independent trade unions concluded in a recent study that the average family's food costs will rise by 11 percent. Most Croats struggle to make ends meet on an average monthly income of $400. The economy is plagued by rampant corruption and a housing shortage. PM
SOLANA WANTS "MORE MOBILE" PEACEKEEPERS
NATO Secretary-General Javier Solana told the Paris daily "Le Monde" of 1 December that "after SFOR's [mandate runs out in June 1998], the presence of more mobile, flexible troops will still be necessary in Bosnia, but it is premature to speak in terms of numbers and duty." News agencies reported from Brussels on 2 December that NATO's 16 defense ministers have reached a consensus on options for a future peacekeeping mission in Bosnia. Details are not yet available, however. PM
NEW GOVERNMENT FOR MOSTAR COUNTY
The Mostar County assembly on 1 December elected Zeljko Obradovic of the Croatian Democratic Community county governor. Fatima Leho, who represents the Muslim-led Coalition for a United Bosnia and Herzegovina, is his deputy, an RFE/RL correspondent reported from Mostar. The allocation of offices in county and municipal governmental institutions in Mostar is carefully balanced between Croats and Muslims. PM
MAJOR EUROPEAN LOAN FOR BOSNIA
Representatives of the European Bank for Reconstruction and Development announced in Sarajevo on 1 December that the EBRD has approved a $18 million loan to help rebuild Bosnia's power grid, much of which was destroyed in the war. Work is slated to be carried out both in the mainly Croatian and Muslim federation and in the Republika Srpska. Bosnia was a major producer of electric power in the former Yugoslavia. PM
ALBANIA'S MILO SAYS KOSOVO AN INTERNATIONAL ISSUE
Albanian Foreign Minister Paskal Milo told the Pristina daily "Koha Ditore" of 1 December that "Kosovo has become an international problem whether Belgrade likes it or not." He added that Serbia could best demonstrate good will by implementing "a peaceful, political solution" to the Kosovo question. Serbia maintains that Kosovo is a purely domestic affair (see "RFE/RL Newsline," 1 December 1997). The Albanian opposition and many Kosovars suspect that the Albanian government has agreed to accept the Serbian point of view in order to promote good relations between Tirana and Belgrade (see "RFE/RL Newsline," 26 November 1997). Meanwhile in Brussels on 1 December, Kosovar shadow-state President Ibrahim Rugova called for an international protectorate for Kosovo. Rugova added that the province must be completely demilitarized, "Nasa Borba" wrote. PM
ALBANIANS RESIST DEPORTATION FROM ITALY
More than 100 Albanian refugees in Brindisi launched a hunger strike on 1 December to protest Italian plans to repatriate them over the next few weeks. Some 5,000 Albanians remain in camps in the Puglia region, which the Italian authorities say they will close as soon as possible. Up to 17,000 Albanians fled to Italy during the anarchy that gripped their country in the spring. Some have since returned home, and many more live illegally throughout Italy. PM
UN WARNS ALBANIA ON AIDS
The UN sponsored a seminar in Tirana on 1 December to mark World AIDS Day and warn of the threat that AIDS poses to Europe's poorest country. Participants blamed the government and conservative social attitudes for widespread ignorance about AIDS and how it is spread. Prostitution, migration, and drugs are the main risk factors in Albania, participants added. The UN and the Albanian government are jointly sponsoring an AIDS-awareness program. The first case of AIDS was reported in 1993, and six people have died as a result of the immune deficiency syndrome. Some 32 people are registered as HIV-positive. PM
ROMANIAN PRESIDENT URGES SELF-TRUST
In a speech delivered in Alba Iulia on Romanian National Day (1 December), Emil Constantinescu said the country is now democratic and hence "everything depends on ourselves." He said that if mistakes are made, "we must stop blaming them on the international situation, on geopolitics, or on the alleged [misunderstanding of others] due to a lack of communication." He said the battle against poverty depends on the success of the economic reforms and "now that we are again at a crossroads, we must trust in ourselves." For the first time since the overthrow of communism, a military parade was staged in Alba Iulia to mark National Day. MS
MOLDOVAN CONSTITUTIONAL COURT RULES AGAINST BUDGET PROVISIONS
The Constitutional Court on 1 December ruled that two provisions of the budget approved by the parliament on 25 November are illegal. One provision states that the government is to issue regulations establishing when judges are entitled to receive bank loans. According to the other provision, 50 percent of the fines imposed by courts will be used for court maintenance costs. The court ruled that both provisions contravened the law on the status of judges, which stipulates the state grant justices receive free housing for six months or interest-free loans for accommodation purposes, BASA-press reported. MS
MOLDOVAN PRESIDENT ON POLITICAL SYSTEM
Petru Lucinschi on 1 December repeated his belief that Moldova must opt for a full presidential system or a full parliamentary system. He said the present, semi- presidential system hinders the promotion of reforms. He also noted that political struggles preceding the 1998 parliamentary elections "heat the atmosphere in our society and have a negative impact on the development of the spirit of entrepreneurship at the local level," BASA- press reported. MS
BULGARIA TO TEAR DOWN RED ARMY MONUMENTS?
Vice President Todor Kavaldzhiev on 1 December told a conference that "monuments of the Soviet army in the center of [the capital] must be replaced by monuments commemorating the victims of communism, " an RFE/RL correspondent in Sofia reported. In other news, the government on 1 December announced that the Bulgarian ambassador to Canada will sign a new international convention banning landmines at a 3-4 December conference in Ottawa. Romania is sending Foreign Minister Adrian Severin to sign the convention. MS
THE FALL OF VACLAV KLAUS
by Breffni O'Rourke
Months of political unease in the Czech Republic have ended dramatically with the resignation of Prime Minister Vaclav Klaus and his coalition government.
Klaus stepped down early on 30 November amid allegations that his Civic Democratic Party (ODS) improperly accepted more than $200,000 in donations that may have had an influence over privatization decisions.
The sudden fall of Klaus's long-troubled three-party coalition had an immediate impact on the financial markets. On 1 December, the Czech crown dropped sharply against the German mark, and analysts say they expect further losses during the week. The currency was already weakened as it became clear that strains inside the government were reaching breaking point. Similarly, the Prague stock market suffered heavy losses at the start of trading on 1 December.
The fall of Klaus, who is seen as the architect of his country's transition to free enterprise, was precipitated from within the ODS. Two senior members, Finance Minister Ivan Pilip and former Interior Minister Jan Ruml, chose a moment when Klaus was absent from Prague to demand his resignation. Supporters of Klaus accused Ruml and Pilip of plotting the premier's overthrow. President Vaclav Havel then called for Klaus to resign, saying the donation scandal was the straw that broke the camel's back. The president also argued that the Klaus government had exhausted its conceptual potential, alluding to the political and economic lethargy into which the Czech Republic has sunk following the crisis of confidence in the crown in last May.
Before then, the country was regarded as a model among the transition economies, and Klaus appeared to be successfully implementing broad economic restructuring without causing the pain common in other transition economies. But Klaus failed to realize the importance of creating a proper regulatory framework to govern the restructuring process. Corruption and mismanagement became widespread, large-scale privatization lost momentum, and foreign investment dried up. Analysts say that since May, the Klaus government has been living on borrowed time.
The leftist opposition Social Democrats (CSSD), who are riding high in public opinion polls, have called for new elections. But Havel has resisted that call, noting that he is not bound to call such a vote until other possibilities have been exhausted. Commenting that the country is already at a virtual standstill, he added that elections would hold it frozen for another six months.
The ruling coalition partners--the ODS, the Civic Democratic Alliance, and the Christian Democrats--have agreed with Havel that the present government will remain in power temporarily until the ODS holds a special congress to sort out its internal troubles. Scheduled to begin on 13 December, that gathering will determine whether the coalition partners can continue their cohabitation or will have to clear the way for early elections, which would likely result in the CSSD forming a new government, possibly in coalition with the Christian Democrats.
Christian Democrat leader Josef Lux has already said that if the ODS congress re-elects Klaus as party chairman, new elections will seem the only way out of the crisis. Klaus has already signaled that he may stand for re- election as party chairman, although he stressed he will not be a member of the next government.
Klaus has also said that the main job of the temporary government is to avoid economic chaos. All the major parties--government and opposition--have agreed that the current uncertainty must not be allowed to undermine Czech efforts to enter the EU and NATO.
The crisis has already had an impact on the privatization process, however. The coalition says privatization will continue on track, but Finance Minister Pilip has announced that several privatization decisions will be reviewed in the light of the allegations of undue influence within the ODS on that process.
The CSSD, meanwhile, has called for a complete halt to privatization until a new government takes over. Analysts say that if the CSSD were to come to power through new elections, no dramatic reversals of present policies should be expected. But they worry that a leftist government would probably run a bigger budget deficit and soften the fight against inflation. The CSSD, which has accused the present center-right coalition of starving the state sector, would also be less likely to push hard on privatization.
Regardless of which government will be in power, it would be wrong to consider the fall of Klaus as a cataclysm for the Czech Republic. As Havel pointed out, the present government's resignation creates scope for Czechs to think about a different government, one with renewed energy and dynamism. The author is an RFE/RL senior correspondent.