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Newsline - May 20, 1998


Kemerovo Oblast Governor Aman Tuleev on 20 May declared a state of emergency in the region after miners in Prokopevsk blocked the Great Siberian Ring railroad, RFE/RL's Moscow bureau reported. That railroad was being used to reroute some traffic from the Trans-Siberian, which miners have blocked for six days (see "RFE/RL Newsline," 18 and 19 May 1998). Coal miners in Rostov Oblast and Komi Republic continue to block major railroads, ITAR-TASS reported. Miners in the Republic of Buryatia, Chelyabinsk and Sakhalin Oblasts also staged protests on 20 May, and former gold miners in Krasnoyarsk Krai blocked a railroad connecting the Trans-Siberian to the Republic of Khakassia. Meanwhile, during negotiations with a group of federal officials in Perm Oblast on 19 May, miners placed the group under "house arrest" until urgent steps are taken to solve their problems. LB


Prime Minister Sergei Kirienko has ordered Deputy Prime Ministers Oleg Sysuev and Boris Nemtsov to cancel planned trips abroad in order to visit regions that have been affected by the unrest among coal miners, Russian news agencies reported on 20 May. Sysuev will go to Kemerovo, instead of South Korea, and Nemtsov, who was scheduled to fly to Italy, will travel to Rostov Oblast. The previous day, Nemtsov discussed the crisis in the coal industry with leaders of some 20 regions of the Russian Federation. Meanwhile, Kirienko on 20 May ruled out the use of force against coal miners taking part in civil disobedience, ITAR-TASS reported. The same day, the State Duma passed a resolution calling on President Boris Yeltsin to convene an emergency joint session of the two houses of the parliament to discuss the situation in the coal industry. LB


The wave of protests by unpaid coal miners is taking a huge financial toll on railroads, "Izvestiya" reported on 20 May. The Railroad Ministry lost 12.7 million rubles ($2.1 million) during the first three days of the blockade of the Trans-Siberian. The blockage of the North Caucasus railroad by miners in Rostov Oblast caused losses of 3 million rubles in two days. Protesters in Komi Republic are allowing passenger trains to use the Vorkuta-Moscow route, but cargo traffic remains at a standstill, ITAR-TASS reported. On 19 May, the management and trade union committee of the West- Siberian railroad warned Kemerovo miners that their actions are leaving railroad workers and their families without money. Vladimir Starostenko, the head of that railroad, told ITAR-TASS that more than 100 freight trains are stalled on the Trans-Siberian and that many would-be passengers are demanding refunds on train tickets. LB


Communist Party leader Gennadii Zyuganov announced during a 20 May Duma session that the Communist and allied factions are collecting signatures demanding Yeltsin's removal from office, RFE/RL's Moscow bureau reported. By the end of the day, they are likely to obtain the 150 signatures needed in order to place an impeachment vote on the Duma's agenda. But Liberal Democratic Party of Russia leader Vladimir Zhirinovsky has already said his faction will not support the impeachment motion, ITAR-TASS reported on 20 May. Without Zhirinovsky's support, such a motion is highly unlikely to gain the 300 votes needed in the Duma. Even if the Duma calls for Yeltsin's impeachment and sends the motion to the Supreme Court, as required by law, the court is almost certain to rule that there are no grounds for removing the president from office. LB


The Federation Council on 20 May passed a revised version of the land code by 97 to 21, with eight abstentions, RFE/RL's Moscow bureau reported. The new draft is somewhat different from the version passed by both houses of the parliament last year, but it retains a prohibition on the purchase and sale of farmland (see "RFE/RL Newsline," 23 April 1998). Yeltsin has said he will not sign any land code that does not give farmers full land ownership rights. While the State Duma would likely override a presidential veto, their allies in the Federation Council would probably find it difficult to gain the two- thirds majority needed to force Yeltsin to sign the code. LB


Central Bank Chairman Sergei Dubinin on 19 May called for the government to "reconsider its relationships" with foreign financial institutions that have been involved in the latest speculative attacks on the ruble and on Russian treasury bills, Reuters and Interfax reported. During the last week, the Central Bank spent some $520 million defending the ruble, bringing Russia's gold and hard- currency reserves down to $15.5 billion. It also raised interest rates to their highest level in the last 18 months (see "RFE/RL Newsline," 19 May 1998). Dubinin said that "it's hard to imagine that some Western investment institution can simultaneously be both a consultant to the government for some deal on distributing Eurobonds and so on and be involved in the collapse of the government securities market and national currency." Nevertheless, he advised speculators not to "count on" a sharp devaluation of the ruble. LB


"Russkii telegraf" on 19 May blamed "Nezavisimaya gazeta" for the recent collapse in the market for government treasury bills (GKOs). "Russkii telegraf" argued that the widespread sell-off of GKOs was not an inevitable result of events in southeastern Asia. It charged that an article in "Nezavisimaya gazeta" alleging that the GKO market is a dangerous "debt pyramid" was translated and widely distributed to foreign investors (see "RFE/RL Newsline," 15 May 1998). It also accused "Nezavisimaya gazeta" of publishing unfounded claims that a law on shares in the electricity monopoly Unified Energy System will lead to the "nationalization" of company shares currently held by foreigners. "Russkii telegraf," which is owned by Oneksimbank, claimed that a ruble devaluation and declining share values for Russian companies would be advantageous for Boris Berezovskii, an Oneksimbank rival and financial backer of "Nezavisimaya gazeta." LB


"Nezavisimaya gazeta" on 20 May claimed that the Central Bank is "ready to sharply devalue" the ruble but wants the president or prime minister to take the political responsibility for such a decision. The newspaper compared Russia's current financial condition to a patient in a coma who can be saved only by a major operation--in this case, a ruble devaluation. "Nezavisimaya gazeta" also noted that in a recent article for the weekly "Ekspert," Central Bank First Deputy Chairman Sergei Aleksashenko acknowledged that devaluation is one instrument for improving a country's trade balance, even as he argued against devaluing the ruble. "Nezavisimaya gazeta" challenged the official government viewpoint that there are no "objective" reasons for the current market turmoil in Russia. It also warned that Russia's financial crisis "is developing on the Indonesian model." LB


The government has announced plans to appeal to the Supreme Court and the Constitutional Court to prevent the implementation of the law on shares in Unified Energy System (EES), Russian news agencies reported on 19 May. The government believes the law violates the civil code and the constitution. The law's most contentious provision restricts foreign shareholders to at most a 25 percent stake in EES. More than one-quarter of the company's shares are currently in foreign hands. Deputy Prime Minister Nemtsov on 19 May attributed the recent declines on the Russian stock market in part to the adoption of the law, which Yeltsin was forced to sign after both houses of the parliament overrode his veto. Also on 19 May, Federal Securities Commission Chairman Dmitrii Vasilev told journalists that his commission will take "all necessary measures" to protect the rights of EES shareholders. LB


Following a meeting in Moscow on 19 May with OPEC Director-General Rilwanu Lukman, Deputy Prime Minister Nemtsov said Russia will attend the annual OPEC summit next month for the first time, Russian agencies reported. Nemtsov told journalists that Moscow and OPEC reached agreement on coordinating their efforts to stabilize world oil markets following the slump in world oil prices. Russia is the world's third-largest oil exporter. LF


In a interview published in "Kommersant- Daily" on 15 May, Yevgenii Ananev, head of the arms export monopoly, accused his predecessor, Aleksandr Kotelkin, of financial mismanagement, saying that he invested millions of dollars in Russian banks that subsequently collapsed, tolerated kickbacks, and lacked a long-term strategic blueprint to maintain Russia's position in international arms trade. Ananev expressed concern that as a result of Kotelkin's lack of vision, Rosvooruzhenie lost valued customers, including most former Warsaw Pact countries. He also said claims that Russia could earn $10 billion annually from arms exports are "unrealistic." LF


Women will head both chambers of the Karelian legislature, which has chosen its top officials following 26 April legislative elections in the republic, ITAR-TASS reported on 19 May. Valentina Pivnenko has been re-elected as head of the House of Representatives. Natalya Kotsyuba, up to now director of the Karelian branch of the Federal Bankruptcy Service, has been chosen to head the House of the Republic and has announced plans to step down as head of the Karelian branch of Victor Chernomyrdin's Our Home Is Russia movement. Karelian legislators have not yet determined whether Pivnenko or Kotsyuba will represent the republic in the Federation Council. (The top legislator in each region of the Russian Federation automatically becomes a member of the upper house of the parliament.) The only other woman in the Federation Council is Koryak Autonomous Okrug Governor Valentina Bronevich. LB


The Supreme Court on 19 May upheld a Moscow City Court ruling that rejected an appeal for a review of the Duma by-election won last month by former Federal Border Service chief Andrei Nikolaev (see "RFE/RL Newsline," 9 and 14 April 1998). Several politicians who dropped out of the race for the Duma seat shortly before the election filed the lawsuit. They claimed that Nikolaev's campaign staff committed numerous violations of the law on parliamentary elections and the law on the electoral rights of voters. The Moscow city authorities supported Nikolaev's campaign, which, opponents charged, gave the former federal border chief an unfair advantage. LB


Lawmakers on 19 May called on Islam Khalimov to resign, blaming him for the inadequate performance of his Sharia Security Ministry in combatting kidnappings and murders. Russian agencies reported. Khalimov had been summoned to the parliament, together with heads of other power ministries, but failed to appear. The parliament's call for his resignation must be approved by President Aslan Maskhadov. LF


For the past two days, residents of Dagestani border districts have been blocking traffic on several main roads leading from Dagestan to Chechnya, including the main Rostov-Baku highway, to protest continued cross- border raids and abductions by Chechen criminal groups, ITAR-TASS and "Nezavisimaya gazeta" reported on 19 May. In an interview published in "Moskovskii komsomolets" the next day, Russian Interior Minister Sergei Stepashin said that the "most varied, mutually exclusive forces" are on a rampage in Dagestan. He added that his ministry must provide the maximum assistance to its Dagestani counterpart "before the situation gets out of control." LF


Heavy rains and strong winds have left many parts of Central Asia without power and cut off from roads and other transport links. At least three people died in floods in eastern Kazakhstan, after heavy rains on 18 May washed away sections of roads and submerged some 50 houses, RFE/RL correspondents reported. Gale force winds in the eastern Caspian Sea are thought to have been responsible for the sinking of a patrol boat belonging to Kazakhstan's Customs Service. The boat's crew was lifted to safety by a helicopter. The same day, storms in southern Kyrgyzstan caused damage to more than 1,000 houses in the Suzdak district, and some 40,000 residents of the Jalalabad Region were forced to leave their homes by the worst mud slides in 20 years. BP


In Tajikistan, torrential rains cut off power to regions in the south on 18 May, while Dushanbe was without power for several hours after lines to the Nurek hydro-electric dam were severed, ITAR-TASS reported. All roads to the capital were flooded. A 19 May broadcast from Radio Voice of the Islamic Republic of Iran reported than more than 16,000 people have been left homeless. Last month, the central regions of Tajikistan were heavily flooded. The Red Cross/ Red Crescent has already sent aid to the affected areas, and neighboring Uzbekistan and Kyrgyzstan are continuing to send help as well. BP


The World Bank has pledged to extend aid worth $610 million to Kyrgyzstan over the next two years to help continue economic reform, ITAR-TASS reported on 20 May. Speaking at a donor conference in Paris, World Bank Vice President for Europe and Central Asia Johannes Linn noted that the Kyrgyz economy has grown by 7 percent annually over the last two years and that great progress has been made in the privatization of agriculture and industry. He added, however, that poverty remains a problem in Kyrgyzstan. Kyrgyz Prime Minister Kubanychbek Jumaliev, who attended the conference, said "not everyone can find their place in the new socio-economic conditions." He said that 60 percent of the population earns less than the minimum wage, calculated on the basis of the consumer food basket, and 18 percent live in "absolute poverty." BP


Robert Kocharian on 19 May issued a decree creating a commission tasked with drafting amendments to the constitution, RFE/RL's Yerevan bureau reported. The commission is to be headed by his adviser on legal reform, Paryur Hayrikian. The draft amendments are expected to include measures on curtailing the extensive powers of the president and augmenting those of the parliament and cabinet of ministers. They will be put to a nationwide referendum. LF


At a 19 May meeting, Armenian President Kocharian and Israeli Ambassador Ehud Moshe Eidman discussed establishing closer ties and expanding economic cooperation, RFE/RL's Yerevan bureau reported. Kocharian said Armenia is particularly interested in agriculture and high technology, noting that Israel's experience "may be useful" to Armenia. He added that the Israeli experience is all the more relevant to Armenia as both countries are not rich in natural resources but possess "strong intellectual potential." LF


At his first press conference since his appointment as defense minister last month, David Tevzadze said conditions in the Georgian armed forces are "unbearable" and one of the reasons for a recent upsurge in desertion among conscripts, "Nezavisimaya gazeta" reported on 20 May. Tevzadze cited no figures, but the Georgian newspaper "Kavkazioni" last summer estimated that some 3,000 servicemen, or 10 percent of the nominal strength of the army, were on the run. In a move to bring the Georgian army closer to NATO standards, Tevzadze proposed introducing civilian structures and appointing a civilian as one of his deputies. He also said that Georgia will use every opportunity to train its officers abroad. Georgia has concluded training agreements with Turkey and the U.S. LF


Some 3,500 coal miners who have taken part in marches over the past few days arrived in Dnipropetrovsk on 19 May and gathered outside the oblast administration building to demand the payment of wage arrears, ITAR-TASS reported. They reacted angrily when acting Coal Industry Minister Volodymyr Radchenko pledged to pay only their wages for this month, saying the state has no funds to pay the miners for previous months. As of mid-May, the state debt to the coal mining sector totaled 2.1 billion hryvni (more than $1 billion). JM


Some 1,800 students from the non-state Institute of Business and Management in Minsk have signed an open letter of protest to Deputy Premier Uladzimir Zamyatalin over a recent government ruling that only graduates from state universities will be issued state diplomas, RFE/RL's Belarusian Service and Belapan reported. The students say that the ruling "casts doubt on the future of 30,000 young people and their possibility of finding employment." They also urge the government to reconsider its decision. JM


Guntars Krasts has blamed the recent spate of bomb attacks in Riga and Moscow on extremist groups and called for a crackdown on the public display of Communist and Fascist symbols. In a statement, the Latvian premier said the explosions in Dobele, at the Russian embassy in Riga, and at synagogues in the Russian and Latvian capitals show that Communist and Fascist organizations are stepping up their activities. He added that he will ask the Latvian National Security Council to consider a law increasing fines for displaying Communist and Fascist insignia. Krasts's statement comes after a demonstration in a Riga park in which some participants were dressed in black and wore armbands with the hammer and sickle symbol. JC


Laimonis Strujevich on 19 May said that Russia has harmed Latvia's image as a key transit state by threatening to impose economic sanctions, Reuters reported. At a cabinet meeting in which he reported on the country's transit sector, Strujevich said Latvian ports have handled roughly the same amount of cargo so far this year, compared with 1997, but added that officials will have to work hard to keep the custom of international shippers and companies. Transit trade accounted for some 17.2 percent of Latvia's GDP last year. JC


Foreign Minister Bronislaw Geremek, who is currently on a state visit with President Aleksander Kwasniewski in Finland, told journalists on 19 May that Poland may offer "normal European transit conditions" to Russia to access the Kaliningrad exclave by highway, Reuters reported. Russia has a link to Kaliningrad through Lithuania but wants guaranteed passage to Kaliningrad through Belarus and Poland. Geremek added that Poland opposes giving any special status to the route, as suggested by Russia two years ago. He called for European assistance to develop Kaliningrad's economy but also expressed concern about Russia's heavy military presence in the exclave. JM


Education Minister Miroslaw Handke has denied that his ministry will divide public schools into Catholic and lay ones, "Zycie Warszawy" reported on 20 May. Handke's statement follows a report published in the 19 May "Gazeta Wyborcza" on the ministry's plan to introduce a dual education system (see "RFE/RL Newsline," 19 May 1998). The minister stressed that the authorities will not "impose any world view upon anybody, either directly or indirectly." JM


Almost two-thirds of Czechs support the parliament's recent decision to ratify accession to NATO, an opinion poll conducted by the STEM agency shows. Sixty percent of the respondents said NATO membership is the best solution to the country's security problems, CTK reported on 19 May. Last month, support for joining the alliance was some 50 percent. In other news, four skinheads have been charged and detained in Orlova in connection with the racially motivated attack that left a Rom dead last weekend. A Prague court has ruled that nine people detained after a 16 May protest that turned violent will remain in custody pending an investigation. A police spokeswoman said another 16 people were released but will face trial on charges of hooliganism and attacking a public official (see "RFE/RL Newsline," 17 May 1998). MS


President Vaclav Havel will have surgery to remove a colostomy bag in late July. Havel was given the colostomy by Austrian surgeons when he underwent emergency surgery for a perforated colon in mid-April. Miroslav Cerbak, the coordinator of Havel's medical team, said on 19 May that delaying the operation until July will allow Havel more time to recover from that operation. Doctors had originally planned to remove the bag at the end of this month, CTK reported. MS


Socialist Party chairman Gyula Horn and Federation of Young Democrats-Hungarian Civic Party (FIDESZ-MPP) leader Viktor Orban have both received threats ahead of their public debate scheduled for 21 May. That debate is the first of its kind before an election in Hungary. The two leaders have received threats that their participation in the debate "will be prevented," Hungarian media reported. Other politicians have also received threats in recent weeks, and increased public security has become a major issue in the election campaigns of all political parties against the background of bomb attacks on private businesses and political party offices as well as a number of assassinations earlier this year. MSZ


Yugoslav President Slobodan Milosevic on 19 May nominated as prime minister former Montenegrin President Momir Bulatovic to succeed Radoje Kontic, whom the parliament had ousted the previous day (see "RFE/RL Newsline," 19 May 1998). Milosevic praised Bulatovic's "patriotic orientation" and called him "the most prestigious personality in Montenegro [who] enjoys great support from the Montenegrin people." The parliament on 20 May confirmed Bulatovic's appointment. Observers noted that Milosevic's choice of Bulatovic, who is the foremost political enemy of Montenegrin President Milo Djukanovic, indicates that Milosevic is determined to step up his confrontation with the reformist leadership in Podgorica in the runup to the 31 May parliamentary elections in the mountainous republic. PM


Milica Pejanovic- Djurisic, who is the president of Djukanovic's Democratic Socialist Party, told Milosevic in Belgrade on 19 May that by replacing Kontic with Bulatovic "he was bringing into question the survival of Yugoslavia." She said in an open letter to Bulatovic that "nobody in Montenegro recognizes the validity" of his nomination and that he "is participating in the dismantling of the Montenegrin state." In Podgorica, the parliament voted in an emergency session not to recognize Kontic's ouster and called the vote against him illegal. The Podgorica legislature passed a resolution saying that Kontic's removal was made possible by the vote of six Montenegrin deputies, whose mandates the Montenegrin parliament had invalidated on 15 May. Also in Podgorica, Richard Miles, who is the U.S. chief of mission in Belgrade, handed over to Djukanovic a letter from Secretary of State Madeleine Albright and discussed with him the current political situation. PM


Members of a planning committee have drawn up three options for stationing NATO troops along Albania's frontier with Kosova and will present those options to NATO's governing body on 28 May, an RFE/RL correspondent reported from Brussels on 19 May. The proposals call for sending between 7,000 and 20,000 soldiers to secure the border and prevent the spread of the conflict. The Albanian government has repeatedly asked NATO to send troops. In Kukes, Albanian border control authorities issued an invitation to their Yugoslav counterparts to discuss security in the region on 25 May, the Belgrade daily "Danas" wrote. PM


Some 200 Serbian police searched a passenger train at Pograxha station along the Prishtina-Peja line on 19 May and took 30 ethnic Albanian males from the train. The police later released 22 of the men but detained the remaining eight. The Kosovar KIC news agency said the move is most likely aimed at deterring Kosovars from traveling between Prishtina and Peja. KIC added that this is the first time that police have removed persons from a train since the conflict in Kosova began at the end of February. Police closed the road linking the two towns on 8 May. PM


In the Drenica region, Serbian paramilitary police killed a 95-year-old woman when they shelled the village of Citak on 19 May. Residents of the village said that police told them on 15 May that "we're going to kill all of you." The Serbian authorities maintain that the villagers harbor members of the Kosova Liberation Army (UCK). Police also shelled a village in the Iglareva region. In Prishtina, Serbian spokesmen said that UCK gunmen fired on two Serbian trucks and a bus on the Prishtina-Peja road on 19 May. The spokesmen added that gunmen kidnapped a Serbian policeman after forcing him to stop his car. PM


Veton Surroi, who is Kosova's leading journalist and a member of shadow-state President Ibrahim Rugova's 15-member negotiating team, told Reuters in Prishtina on 19 May that the G-15 group has not yet decided whether to participate in talks with its Serbian counterpart slated for 22 May. Surroi said that the negotiators "have a good list of reasons why we shouldn't attend and yet we still see a reason to attend." He did not give details. PM


U.S. envoy Richard Holbrooke told CNN on 19 May that "it would be a mistake for the Kosova leadership not to go to these talks because the violence is something which neither side can fully control." He praised Rugova as a "sincere apostle of non- violence" but added that "to his left are some very dangerous people who wish to use violent means instead of peaceful means.... I think the time to try to get a peaceful settlement is now before the situation spirals out of control." PM


A UN police spokesman said in Sarajevo on 19 May that the exchange of old license plates for new ones is proceeding well except in some Croatian-controlled areas of western Herzegovina. The new license plates do not indicate in which part of Bosnia the car is registered and were introduced by the international community in February to facilitate freedom of movement. The old license plates become invalid on 1 June. The Herzegovinian Croats currently use license plates that are nearly identical to those used in Croatia. Also in the Bosnian capital, a spokesman for the Organization for Security and Cooperation in Europe, which is organizing the September general elections, said that 25 parties have registered to participate in the vote. PM


The steering committee of the governing Croatian Democratic Community (HDZ) issued a statement in Zagreb on 19 May in which it "expressed confidence" in the new hard-line Herzegovinian HDZ leadership of Ante Jelavic (see "RFE/RL Newsline," 18 May 1998). President Franjo Tudjman had openly supported Bozo Ljubic, a moderate, for the post. Also in the Croatian capital, teachers staged a one-day warning strike on 20 May for more pay. Elsewhere in Zagreb, spokesmen for Croatian Railways announced on 19 May that two daily international trains linking the former Yugoslavia with Munich and Zurich will begin running between Zagreb and Belgrade on 24 May. Finally, shares of the Zagreb Bank lost over 10 percent of their value on 18 May, "Vecernji list" reported on 20 May. PM


Valerian Stan, executive chairman of the Movement of Civic Alliance, has accused President Emil Constantinescu of condoning corruption. Stan said on 18 May that Constantinescu and his main political counselor, Zoe Petre, have sought to "cover up" the involvement of the main culprits in the cigarette smuggling affair. The accusations are mainly targeted against "one or two colonels," he noted. Stan also said that the president had ordered his dismissal as chief of the Government Control Department Victor Ciorbea's cabinet after Stan had revealed corruption among leading members of the Democratic Party. CDR chairman Ion Diaconescu said the movement "can afford to attack" because "it does not share the responsibility of government, where compromise is necessary." The Movement of Civic Alliance recently quit the ruling Democratic Convention of Romania (CDR). MS


The government has announced that the elections to the Bucharest mayoralty will be held on 11 October, Mediafax reported on 19 May. The government said time is needed to amend the local election law. MS


The Democratic Convention of Moldova (CDM) is threatening not to vote confidence in the cabinet headed by Ion Ciubuc unless a compromise is reached on its composition, RFE/RL's Chisinau bureau reported. CDM co-chairman Mircea Snegur told journalists on 19 May that there is a danger of a "return to the starting point," where "President [Petru] Lucinschi will have to appoint someone else as premier." Party of Democratic Forces (PFD) chairman Valeriu Matei has issued a similar warning. Ciubuc, for his part, has said that the CDM's and PFD's refusal to agree to Nicolae Cernomaz continuing in office as minister of state (deputy premier) stems from "animosity" dating back to 1996, when Cernomaz headed Lucinschi's campaign against Snegur in the presidential elections. Ciubuc has also said he needs Mihai Plamadeala to continue as interior minister in order to carry on the fight against corruption. MS


Sofia chief prosecutor Nestor Nestorov on 19 May said a suspect has been detained in connection with the attack on "Trud" journalist Anna Zarkova, RFE/RL's Sofia bureau reported (see "RFE/RL Newsline," 12 May 1998). Doctors treating Zarkova in the hospital said they have not lost hope of restoring partial sight to her left eye, which was burned when acid was thrown in her face at a Sofia bus station. In other news, "Duma," the opposition Socialist Party daily, was not distributed on 19 May. The state printing house refused to print the daily because of long- standing debts. The newspaper's editorial staff said the refusal serves "political purposes." MS


Deputy Premier Alexander Bozhkov, speaking to a 19 May conference in London on privatization in Bulgaria, said his country expects investments to reach $800 million in the second wave of privatization, Reuters reported. Bozhkov said that by the end of this year, the government expects 80 percent of enterprises to be in private hands. He said the cabinet wants to abolish its privatization agency by the end of 1999. Bozhkov said Bulgaria's potential for foreign investors is "huge," particularly in finance, tourism, transportation, and telecommunication. In other news, visiting Uzbek Foreign Minister Abdulaziz Komilov told an RFE/RL correspondent in Sofia that his country is interested in using Bulgaria as a transit route for its exports to Europe, particularly for cotton. MS


by Emil Danielyan

It has been four years since the fighting ceased in Nagorno-Karabakh. That respite has saved thousands of Armenian and Azerbaijani lives but has failed to materialize into a lasting peace. Recent developments in the region suggest that the peace process still has a long way to go before the parties to the conflict will reach an agreement. Although there is little information about the visit last week to Yerevan, Stepanakert, and Baku by the three co-chairmen of the Organization for Security and Cooperation in Europe's Minsk Group, they evidently made scant progress toward breaking the stalemate.

Yet the very fact that the cease-fire has largely held for four years without the presence in the region of peace- keepers is quite remarkable. Initially signed for three months only on 12 May 1994 by Armenia, Azerbaijan, and the self-proclaimed Nagorno-Karabakh Republic with Russia's mediation, the cease-fire agreement has come to acquire a permanent nature. It has suspended a bitter war, in which more than 20,000 people were killed, and left Karabakh Armenians in control of virtually the entire disputed region and territories in Azerbaijan proper, which surrounds Karabakh. Minor skirmishes from time to time disturb the calm on the front line around the Armenian- populated enclave, but they have so far not developed into all-out hostilities. However, many believe that it is only the parties' own interests that prevent the war from resuming.

The latest toughening of Armenia's position will either provoke strong pressure from the Minsk Group or cause the latter to restart its peace efforts from scratch. The new authorities in Yerevan reject the group's most recent "phased" plan, which provides for the return of the occupied Azerbaijani territories ahead of an agreement on Karabakh's status. Armenia and Karabakh favor a "package" deal, settling all contentious issues by means of a single framework accord. The Armenians also vigorously oppose any kind of "subordination" in future relations between Baku and Stepanakert.

Under such circumstances, it is reasonable to expect pressure on the Armenians as the recalcitrant party (Azerbaijan has accepted the OSCE's plan). But there are few indications that the Russian, U.S., and French co- chairmen of the Minsk Group will go so far as to advocate "peace enforcement." Hence the "wait-and-see" strategy of Armenian President Robert Kocharian, who appears to want to stick to the harder line, avoiding "hasty" concessions.

Indeed, Kocharian may well be in a position to continue that line for several years to come. With the flow of the "main" Azerbaijani oil expected no earlier than 2003, Azerbaijan will hardly be able to embark on a large-scale military build-up before then. Kocharian may also think that Western oil giants, too, have a vital interest in peace and will therefore pressure Baku to make concessions. The constant threat of war puts their multi-billion-dollar investments at enormous risk.

In one respect, the package strategy is more conducive to peace than a step-by step one, which is full of pitfalls, as evidenced by the Middle East peace process. The formal establishment of Nagorno-Karabakh's status would pave the way for settling other bones of contention, such as security guarantees and a land corridor with Armenia. Such a development would require reconciling "the highest degree of autonomy for Karabakh in Azerbaijan," supported by the international community, and "horizontal" ties between two equal entities, as demanded by Armenia. "Horizontal ties" resemble the Bosnia option, with each ethnic community having its own army and enjoying an equal, internationally guaranteed status. This would be a face-saving solution whereby the principle of the inviolability of existing frontiers would not be compromised.

But it is unlikely that Azerbaijan will agree to serious concessions at this juncture, not least because of presidential elections scheduled for October. Although President Heidar Aliyev is virtually assured an election victory, he will nonetheless be reluctant to discuss a compromise during the election campaign. And Azerbaijani presidential adviser Vafa Gulu-Zade insisted last week that direct talks between Baku and Stepanakert are possible only if the latter agrees beforehand to autonomous status within Azerbaijan.

Moreover, the co-chairmen's visit to the Transcaucasus failed to clarify whether they will press on with the current plan or shift to the package option. (Armenia and Karabakh both stressed their desire to resume peace negotiations in the hope of quickly reaching a solution.) Thus, a delay in the peace process until the fall now seems likely and would give the mediators more time to consider which strategy to adopt. Even more than till now, the future of the troubled region will depend on that strategy. The author is a Yerevan-based RFE/RL correspondent.