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Newsline - July 3, 1998


Lev Rokhlin, chairman of the State Duma Defense Committee from January 1996 until May 1998, was shot dead at his dacha outside Moscow in the early hours of 3 July. An Interior Ministry spokesman told ITAR-TASS that Rokhlin's wife has confessed to killing her husband with his own gun. Reuters quoted a police official as saying Rokhlin's son-in-law was the first to accuse the slain man's wife. Hours before the murder, Rokhlin and his family had celebrated his son's birthday. LB


Rokhlin first gained prominence as the commander of the troops that stormed Grozny in the early weeks of the war in Chechnya, but he refused to accept a medal for those actions. He began his political career as the number three candidate for Viktor Chernomyrdin's Our Home Is Russia movement in the December 1995 parliamentary elections. A strong supporter of former Defense Minister Igor Rodionov, Rokhlin began to strongly criticize the president and government in June 1997, one month after Rodionov was sacked. He accused the authorities of destroying the armed forces. In September 1997, he left the Our Home Is Russia movement and formed his own Movement to Support the Army, which set as its main goal the ouster of President Boris Yeltsin. Communist allies helped him keep his Duma post for some months but eventually allowed him to be replaced. LB


Speaking to the Duma before reports emerged about the confession of Rokhlin's wife, Duma Security Committee Chairman Viktor Ilyukhin argued that "certain forces in Yeltsin's entourage" are pushing the president toward using force to solve Russia's current problems, NTV and RFE/RL's Moscow bureau reported. He warned that violence against the president's political opponents may lead to civil war. Since 1997, Ilyukhin had been an ally of Rokhlin, and both were vocal supporters of efforts to impeach Yeltsin. Yeltsin's representative in the Duma, Aleksandr Kotenkov, denounced Ilyukhin's remarks as a "provocation." Duma Speaker Gennadii Seleznev, like Ilyukhin a member of the Communist faction, urged deputies to wait for results of the investigation before drawing conclusions about the murder. Meanwhile, Reuters quoted Liberal Democratic Party of Russia leader Vladimir Zhirinovsky as saying Rokhlin was killed because he "knew too much about Chechnya." LB


Yeltsin on 3 July met with Gazprom chief executive Rem Vyakhirev and instructed him to break the "circle of non-payments" in the economy. Vyakhirev interrupted a business trip to Vienna to meet with the president a day after government officials threatened to seize Gazprom assets and break an agreement under which Vyakhirev manages a block of state-owned shares in the monopoly (see "RFE/RL Newsline," 2 July 1998). In remarks broadcast on nationwide television, Yeltsin said all companies, large and small, must pay their full share of taxes, "regardless of what is paid to them." During a 2 July interview with NTV, Vyakhirev acknowledged that Gazprom and its subsidiaries owe some 12 billion rubles ($1.9 billion) in taxes but argued that non-paying consumers--many of them budget-funded organizations--owe the company at least 13 billion rubles. LB


Following his meeting with the president, Vyakhirev held talks with Prime Minister Sergei Kirienko on 3 July. ITAR-TASS quoted Kirienko's press secretary as saying that Vyakhirev agreed to a protocol for paying the company's tax debts. (Deputy Prime Minister Boris Nemtsov convened the collegium of state representatives to Gazprom on 2 July to draft that protocol.) For his part, Kirienko promised Vyakhirev that the government will take steps to ensure that budget-funded organizations pay Gazprom what they owe for gas deliveries. On 2 July, Kirienko said Gazprom has until 6 July to pay its tax arrears in full. Both Kirienko and Nemtsov told journalists that there are no plans to replace Vyakhirev as the company's chief executive. LB


Appearing on NTV on 2 July, Vyakhirev described as a "provocation" the controversy over Gazprom's tax debts. He charged that the confrontation benefits those who would like to see Russian markets collapse and money flow out of Russia and Gazprom. (Gazprom shares fell nearly 14 percent on the Russian stock exchange on 2 July.) Following his meeting with the president on 3 July, Vyakhirev told journalists that "somebody is behaving unfairly in this case." He charged that Yeltsin was not given full information regarding Gazprom's debts to the budget. LB


The State Duma interrupted its consideration of the government's anti-crisis program on 2 July to demand an explanation for the threats against Gazprom. Duma Speaker Seleznev, Communist Party leader Gennadii Zyuganov, Our Home Is Russia faction leader Aleksandr Shokhin, and Liberal Democratic Party of Russia leader Zhirinovsky were among those who condemned the government's actions, Russian news agencies reported. State Tax Service chief Boris Fedorov and Prime Minister Kirienko came to the Duma to discuss the controversy. Kirienko warned that the government will demand that all companies pay their taxes and will not allow "blackmail," RFE/RL's Moscow bureau reported. He also denied that the government has ever planned to break up Gazprom. In his speech to the Duma, Fedorov discounted widespread rumors that an "IMF conspiracy" was behind the conflict with Gazprom. Fedorov added that he is just trying to do his job. LB


News coverage on NTV on 2 July portrayed the government's actions in an unfavorable light, suggesting that inexperienced cabinet members led an attack against Gazprom management but ultimately backed down from the confrontation. The network also broadcast a friendly interview with Vyakhirev. Gazprom purchased a 30 percent stake in NTV in 1996, and a high-ranking executive from the network's parent company, Media-Most, recently became the head of Gazprom's media subsidiary, Gazprom- Media (see "RFE/RL Newsline," 10 June 1998). The daily newspaper "Segodnya," which also is part of Vladimir Gusinskii's Media-Most group, on 3 July criticized the government's "gas attack against Gazprom" as well. The same day, "Nezavisimaya gazeta" termed the events surrounding Gazprom "the last mistake of Sergei Kirienko" and a "multibillion-dollar stupidity." CIS Executive Secretary Boris Berezovskii is the main financial backer of "Nezavisimaya gazeta." LB


The Duma on 2 July rejected a law to change the income tax scale, which was a key part of the government's anti-crisis plan, Russian news agencies reported. The law would have maintained a 12 percent tax on all annual incomes below 20,000 rubles ($1,930). The tax on annual incomes greater than 100,000 rubles would have been reduced from 35 percent to 30 percent, while incomes between 20,000 and 100,000 rubles would have been taxed at a rate of 2,400 rubles plus 20 percent of all income above 20,000 rubles. The law also would have taxed interest on bank accounts and some other forms of income that are currently not subject to income tax. During a 29 June hearing of the Duma Budget Committee, some Duma deputies criticized the draft law, saying it would reduce the tax burden on the wealthy. LB


The Duma on 3 July approved in the third reading a law that would require a medical examination for the president if doubts arose about his health, ITAR-TASS reported. The constitution states that the president's term ends early in case of "persistent inability to carry out his duties" but does not outline a mechanism for determining the president's fitness. The law, supported by 316 votes, would allow either house of the parliament to ask the Supreme Court to rule on the president's health. The court would make such a ruling in conjunction with a medical commission whose members would be nominated by the Academy of Medical Sciences. Since 1995, Yeltsin has periodically spent weeks or months away from the Kremlin recovering from health problems. He is certain to veto the law if it is approved by the Federation Council. LB


The Duma on 2 July passed for the second time a law that would force people to disclose the sources of their incomes to the tax authorities if they spent more than 1,000 times the monthly minimum wage on a single purchase, RFE/RL's Moscow bureau reported. The minimum wage is currently set at 83.45 rubles ($13.5). The Federation Council rejected that law last month, but the Duma approved the measure by the two-thirds margin needed to send the law to Yeltsin. Also on 2 July, the Duma overrode a presidential veto on a law that would double the tax on foreign-currency purchases from 0.5 percent to 1 percent, ITAR-TASS reported. LB


Coal miners in Anzhero-Sudzhensk, Kemerovo Oblast, have begun to block the passage of freight trains on the Trans- Siberian, ITAR-TASS reported on 3 July. The miners are demanding the fulfillment of protocols signed by Deputy Prime Minister Oleg Sysuev on 24 May and Yeltsin's resignation. Kemerovo Governor Aman Tuleev on 2 July placed full responsibility for the situation on the federal government and again warned of a "social explosion" (see "RFE/RL Newsline," 3 and 5 June). Tuleev claimed that the government has fulfilled one protocol, calling for 1 billion rubles ($160 million), by 70 percent and the other, which provides for 1.6 billion rubles ($258 million), by 13 percent, ITAR-TASS reported. Sysuev told a 2 July news conference that Tuleev does not understand the role of the government in the mining sector. He also claimed that the government has met its obligations to the miners in full, Interfax reported. BT


Yurii Skuratov told journalists on 2 July that a planned blockade of the Trans-Siberian Railroad is illegal, RFE/RL's Moscow Bureau reported. Skuratov said he is "not against miners struggling for their rights, but this struggle must take place within the boundaries of law." Although Skuratov ruled out "total legal repressions," he said the Prosecutor- General's Office is collecting evidence against the instigators. During the 10-day blockade in Kemerovo Oblast in May, Skuratov threatened to investigate the miners' actions (see "RFE/RL Newsline," 25 May 1998). Skuratov on 2 July said his office has opened more 20 criminal cases involving corrupt practices in the coal sector, adding that some investigations have been unexpectedly "hindered." Recent investigations by the tax police in mining regions revealed the pocketing of money by middlemen and widespread tax evasion (see "RFE/RL Newsline," 3 June 1998). BT


Environmentalist Aleksei Yablokov said his country's agreement to supply India with nuclear technology is in violation of the Nuclear Non- Proliferation Treaty (NPT), Interfax reported on 2 July. Russia recently promised to fulfill a contract with India signed when a Russian delegation was in India last month. Russian officials, including Foreign Ministry spokesman Valerii Nesterushkin, said Russia's participation in building the Kudankulam nuclear power plant in India will be under the control of the International Atomic Energy Agency (IAEA). Yablokov says, however, that will not be the case as India has not signed NPT or agreed to place its nuclear programs under IAEA's control. "Since not all Indian facilities are being controlled by the IAEA, it will not be possible to learn where the spent nuclear material goes," according to Yablokov. BP


The 3 July summit in Almaty, Kazakhstan, has been hailed as a "complete success," according to ITAR-TASS. The presidents of Kazakhstan, Kyrgyzstan, Tajikistan, and China as well as the Russian foreign minister met for one hour to review implementation of the border agreement signed in Shanghai in 1996 and the military reduction accord signed in Moscow the following year. All leaders agreed that those accords have laid the foundation for boosting bilateral and multilateral trade and for turning the 7,000-kilometer border into a "frontier of cooperation, friendship, and complete trust." Chinese President Jiang Zemin said his country is prepared to act as a "transport bridge" for railroad traffic and pipelines to the "warm South-Asian seas." BP


Kazakh President Nursultan Nazarbayev and Tajik President Imomali Rakhmonov said they are concerned about continued hostilities in Afghanistan, which, they said, have helped turn that country into a "major supplier of drugs to the criminal world." They also said a large amount of weapons are being smuggled from Afghanistan to CIS states. Russian Foreign Minister Yevgenii Primakov warned of the dangers posed by recent nuclear testing in India and Pakistan. He said those texts escalated tensions in the region. Jiang Zemin called for a comprehensive ban and complete destruction of nuclear weapons, Xinhua news agency and RFE/RL correspondents reported. Jiang vowed his country will never "use or threaten to use nuclear weapons against any nuclear-free country or any nuclear-free zone." And he stressed that "China has no intention of resuming nuclear tests." BP


An Israeli delegation led by Trade and Industry Minister Natan Sharanskii has concluded its five-day tour of three Central Asian states (see "RFE/RL Newsline," 30 June 1998), ITAR-TASS and Interfax reported on 2 July. At a meeting with Turkmen President Saparmurat Niyazov, Sharanskii praised Turkmenistan's officially recognized neutral status and was optimistic about the possibilities for cooperation in developing the country's hydrocarbon resources. Sharanskii also promised his country would help with farming in Turkmenistan, by "turning the desert into a garden." Earlier, Sharanskii met with Uzbek President Islam Karimov in Tashkent and agreed to help Karimov's country with irrigation techniques, green-house farming, and developing solar and wind-powered energy systems. BP


The chairman of NATO's military council, Klaus Naumann, concluded his visit to Uzbekistan on 2 July (see "RFE/RL Newsline," 30 June 1998), according to ITAR-TASS and Interfax. Naumann was in Uzbekistan to review preparations for the NATO military exercises in Central Asia involving troops from Uzbekistan, Kazakhstan, and Kyrgyzstan as well as NATO and scheduled for September. (U.S. paratroopers began a training exercise with Uzbek soldiers in the Fergana Valley on 1 July as part of those preparations.) Naumann noted that NATO is "seeking security with Russia" and not against that country and that the image of NATO in Russia as an aggressive military alliance "needs to be scrapped." He also said NATO's "cooperation zone" now stretches from Vancouver to Vladivostok. Naumann left for Turkmenistan on 2 July. BP


Following a meeting with Armenian Foreign Minister Vartan Oskanian, Arkadii Ghukasian, president of the unrecognized Nagorno-Karabakh Republic, told journalists on 2 July that the OSCE Minsk Group understands Armenia's insistence on a new peace plan to resolve the Karabakh conflict and may be prepared to draft a "package" plan that would settle all outstanding issues within a single framework accord, RFE/RL's Yerevan bureau reported. Both Karabakh and Armenia have rejected the OSCE's earlier "phased" peace plan, which Azerbaijan accepted. But Ghukasian added that the Azerbaijani leadership's opposition to a new plan "complicates the situation." Ghukasian said the positions of Yerevan and Stepanakert are largely identical. Ghukasian and newly appointed Karabakh Prime Minister Zhirayr Poghosian had met on 1 July in Yerevan with Armenian President Robert Kocharian to discuss the peace process and the socio-economic situation in Karabakh, Noyan Tapan reported. LF


Emil Constantinescu and his Georgian counterpart, Eduard Shevardnadze, held talks in Tbilisi on 1 July on expanding bilateral relations, including the opening of embassies and consulates. They also discussed cooperating within the framework of the TRACECA project and in the transportation of Caspian oil to Western markets. As in Baku two days earlier, Constantinescu argued that shipping oil to Constanta from Georgia's Black Sea port of Supsa, which he visited on 2 July, is the shortest and most economical route. Constantinescu also visited Batumi and Poti, from where ferry services to Constanta are to begin shortly. LF


Speaking at a press conference with Constantinescu in Tbilisi on 1 July, Shevardnadze said that oil will begin flowing through the Baku-Supsa pipeline in February, 1999, ITAR-TASS reported. Georgian and Azerbaijani officials earlier predicted that repairs to that pipeline, which have proved more extensive and far more costly than originally estimated, will be completed on schedule by the fall of 1998. Shevardnadze added that a decision on the route for the so-called main export pipeline for Caspian oil will be taken before the end of 1998. He hinted that the Baku-Ceyhan route will be chosen but added that some Caspian oil could still be exported via Romania. LF


Mikhail Saakashvili, the 29-year-old chairman of the Georgian parliamentary Committee on State and Legal Affairs, told journalists on 2 July that there is no point in his remaining in that post unless "substantial changes" are made in the structure of the country's executive bodies, Caucasus Press reported. In recent months, Saakashvili has repeatedly criticized corruption both within the Tbilisi municipal authorities and the government. He argued that if a group of young reformers came to power, "real progress" toward solving the country's problems would be evident within one year. Parliamentary chairman Zurab Zhvania has similarly hinted that he may step down in protest at government policy (see also "End Note" below.) LF


The Democratic Congress, composed of 10 major opposition parties, issued a statement on 2 July warning that an unidentified group is disseminating "anti-Turkic propaganda" among the ethnic Kurdish population of five raions in southwestern Azerbaijan that border on Armenia and Iran. The statement also claims that immigration to Azerbaijan among Kurds from Turkey and Iran is growing. (According to the results of the 1989 Soviet census, there were 12,200 Kurds living in Azerbaijan, but the Armenian newspaper "Kommunist" claimed in January 1990 that their number was close to 200,000.) The Democratic Congress added that the Workers' Party of Kurdistan (PKK) has established a representation in Baku. The Azerbaijan National Security Ministry denied earlier reports of a PKK presence in Azerbaijan. LF


Human Rights Watch accused Belarusian President Alyaksandr Lukashenka of being a "quasi dictator" who is reversing political reforms and abusing human rights, AP reported on 2 July. The New York-based group said in a report that Lukashenka has "recreated some of the worst aspects of the Soviet era." The report includes a list of human rights violations registered in Belarus, mostly instances of political persecution and harassment of the media. Meanwhile in Minsk, a book on Lukashenka has been published in which he is quoted saying that "not a single journalist has been harassed." PB


On the eve of the country's national day, President Lukashenka said in a speech that Belarus will "bow to no one," AP reported on 2 July. In an apparent reference to Western critics of his government, Lukashenka said a country cannot enter the year 2000 "carrying the weight of political falsehood [and] using methods of political dictatorship." In 1996, Lukashenka changed Belarus's national day to 3 July, the day Soviet troops liberated Minsk from German forces during World War II. PB


Leonid Kuchma on 2 July criticized Supreme Council deputies after they failed yet again to elect a parliamentary speaker, AP reported. Kuchma said that along with the 1998 budget, more than 100 bills await parliamentary approval. The budget includes a sharp reduction in the budget deficit, a major requirement for a $2.5 billion loan from the IMF. Kuchma said the failure of the legislature to address urgent economic issues has reached a "critical level." He said he is willing to work constructively with the parliament but is prepared to issue more decrees on economic matters if the body remains inactive. More than 50 deputies have been nominated for the speaker position in nearly 20 votes since the Supreme Council convened in mid-May. PB


Ukrainian health officials have found dozens of cases of excess radioactivity in foodstuffs being sold in Kyiv markets, particularly blueberries and mushrooms, AP reported on 2 July. Health authorities have begun televised warnings about the products, which originate from areas of the country contaminated by the 1986 explosion at Chornobyl. PB


President Aleksander Kwasniewski on 2 July vetoed legislation to consolidate the country's provinces, Reuters reported. Kwasniewski said the bill, which has been passed by the Sejm and the Senate, contradicts the will of the people. Kwasniewski and leftist politicians favor reducing the number of provinces from 49 to 17, while the approved bill provides for 15 provinces. Solidarity politicians threatened to cut contacts with the president if he vetoed the bill. In other news, the Sejm approved a bill lifting the ban on beer advertising. The bill is expected to be approved by the Senate and signed by the president. Beer recently supplanted vodka as the most popular alcoholic beverage in Poland. PB


Finance and Deputy Prime Minister Leszek Balcerowicz said on 2 July that Poland's power sector will be privatized by 2002, an RFE/RL correspondent in Warsaw reported. He said that energy prices could be deregulated as soon as January. And he added that the value of the firms to be privatized is nearly 100 billion zlotys ($29 billion). PB


Social Democratic Party (CSSD) chairman Milos Zeman on 2 July said the coalition talks with the Freedom Union are " definitely over." He said his latest proposal to Freedom Union leader Jan Ruml was to set up a coalition with Christian Democratic Party (KDU-CSL) leader Josef Lux as premier and with four seats in the cabinet for the union. Ruml, however, had turned the offer down, citing incompatibility between the parties' programs, CTK reported. The same day, Ruml told journalists that he admires the " responsibility and generosity" of Zeman's proposal and that he hopes the Civic Democratic Union (ODS) will displaying a similar attitude in talks with his party. MS


After meeting with Zeman the same day, President Vaclav Havel said he has asked the CSSD leader "not to make hasty decisions" and to continue efforts to set up a coalition. He added that the CSSD proposals were "very open, consensual, and generous." Also on 2 July, ODS deputy chairman Ivan Langer described as "schizophrenic and absurd" a statement by KDU-CSL deputy chairman Jan Kasal, who said an ODS-Freedom Union-KDU-CSL coalition would be feasible if ODS leader Vaclav Klaus were not in the cabinet. Meanwhile, Miroslav Grebenicek, chairman of the Communist Party of Bohemia and Moravia, said his party will not support a minority government of CSSD ministers only. But he repeated his readiness to "tolerate" a CSSD-KDU-CSL minority government on certain conditions. KDU-CSL leader Josef Lux, however, has rejected that option. MS


The Slovak and Hungarian opposition, supported by some representatives of the governing Movement for Democratic Slovakia, voted down on 2 July an amendment submitted to the parliament on Hungarian-language education in Slovakia. The bill, drafted by the Education Ministry, would have required Hungarian pupils to study history and geography in Slovak and use a curriculum and text books approved by the ministry. MSZ


Entrepreneur Jozsef Tamas Boros and three pedestrians were killed when a bomb exploded on 2 July in Budapest's downtown tourist zone. Some 25 people were injured. Media report that Boros, the owner of several restaurants in Budapest and at lake Balaton, was the target of the bombing. He had recently provided useful information to the police in an investigation into organized crime and illegal oil trade. Three attempts had been made on his life in the past two years, and his home was guarded by police. In other news, Prime Minister-designate Viktor Orban, on 2 July outlined his coalition government's program in the parliament. Top priorities are strengthening the defense of public security, tightening the penal code, and remedying social injustice. MSZ


President Bill Clinton said in Hong Kong on 3 July that "Belgrade is primarily responsible" for the fighting in Kosova, but he added that "others, when they're having a good day or a good week on the military front, may also be reluctant to actually engage in dialogue." He concluded that "the conflict is going on. Both sides are involved in it. There is some uncertainty about who is willing and who is not willing to even negotiate about it. And we're working on it as best we can." Meanwhile in Tirana, five deserters from the Yugoslav army arrived after being taken across the Albanian frontier by fighters of the Kosova Liberation Army (UCK). A spokesman for the Albanian Interior Ministry said that two soldiers from Montenegro and three from Serbia "refused to kill women and children" and deserted their units. The five all have Muslim names, AP reported. PM


U.S. Ambassador to the UN Richard Holbrooke is scheduled to arrive in Belgrade on 3 July for talks with Yugoslav President Slobodan Milosevic aimed at defusing the crisis in Kosova. The previous day, Milosevic called for urgent talks between Serbs and Kosovars as "the only way" to solve the problem. He added that "there are not, nor will there be any repressive actions against the civilian population." Milosevic said that security forces are protecting citizens and their property from "bandits and terrorists." In Washington, a State Department spokesman said that Holbrooke's aim is to persuade Milosevic that "he's leading his country down the path to ruin and that it's time for him to get it through his head that the only course of wisdom is to pull back his forces, stop the crackdown, stop the use of heavy military equipment, and start...negotiations" (see "RFE/RL Newsline," 2 July 1998). PM


A bomb went off in a market in an ethnic Serbian neighborhood in northwest Prishtina at 7 a.m. local time on 3 July. The explosion caused material damage but no injuries, Reuters reported. No one claimed responsibility. It was the first bombing in Prishtina since Milosevic launched his crackdown at the end of February. Also in Prishtina, Yugoslav air force jets continued low flights over the city in a recently begun move that Kosovar spokesmen say is intended to intimidate the ethnic Albanian majority. Meanwhile, shadow-state President Ibrahim Rugova said the Kosovars are ready to "pay whatever price is necessary" to achieve independence, RFE/RL's South Slavic Service reported. PM


Serbian forces broke through the UCK's lines around Kijeva from the west shortly after dawn on 3 July, the semi-official Serbian Media Center reported. Kosovar sources confirmed the story, Reuters added. The UCK had cut off some 200 Serbian civilians and two dozen policemen in the town for more than a week. Holbrooke earlier called Kijeva "the most dangerous place in Europe" and suggested that the confrontation could end with much bloodshed. PM


Prime Minister Fatos Nano said in a statement on 2 July that "we, the Albanian government, during our contact at different levels with our partners in Kosova, have asked that acts of violence on civilians of other ethnic groups be avoided." He warned that attacks on civilians would cause the international community to take a dim view of what Nano called "this Albanian popular movement." He also appealed to all Kosovar factions to agree on a joint negotiating platform. PM


Foreign Ministry spokesman Vladimir Rakhmanin told a briefing in Moscow on 2 July that "all outbursts of violence [in the province] were reactions by the Serbian security forces to provocations by Kosovar Albanians." He added that the Serbs will not be able to withdraw their forces before the "provocations" have ended. Rakhmanin noted that "only a political settlement can bring unquestionable long-term results. Judging from recent statements made in Washington and European capitals, such a view is starting to gain force there as well" (see "RFE/RL Newsline," 2 July 1998). Rakhmanin called the UCK a "terrorist group" that has no place in negotiations, which are limited to political groups, Interfax wrote. PM


NATO Secretary- General Javier Solana said in Sarajevo on 2 July that the Atlantic alliance "will not permit" a Bosnian-type conflict to emerge in Kosova. In Vienna, EU foreign affairs spokesman Hans van den Broek argued that NATO could intervene in Kosova even without a UN mandate if the conflict escalated. In Bonn, a government spokesman said that German officials will take steps to prevent the UCK from forcibly collecting contributions from Kosovars living there and have appealed to Rugova for help, the "Frankfurter Allgemeine Zeitung" reported. Holbrooke recently commented that forced contributions from Kosovars in Western Europe are "vital" for the UCK. Rugova's shadow state has depended for years on a "tax" paid by Kosovars abroad. PM


Serbian police and an official of the Telecommunications Ministry disabled the transmitter of Radio Kontakt in Prishtina on 1 July, the Association of Independent Electronic Media in Yugoslavia (ANEM) said in a statement in Belgrade the following day. Police also blocked the entrance to the broadcasters' building. The ministry charged that the station does not have a valid license, which officials of Kontakt denied. The station began broadcasting music on 19 June and had no trouble with the authorities until 1 July, when it began rebroadcasting news programs of independent Belgrade Radio B-92, VOA, and BBC. ANEM added that Kontakt is unique in Prishtina because it is the only station that seeks to promote interethnic dialogue and broadcasts both in Serbo-Croatian and in Albanian. PM


The Security Council said in a statement in New York on 2 July that "ethnically related incidents, evictions, and housing intimidation cases" have been on the rise recently in eastern Slavonia, which returned to Croatian administration in January. "A continuation of this trend could have a seriously negative effect on the restoration of a multi-ethnic society in the Republic of Croatia," the text concluded. In Rome, Pope John Paul II discussed his upcoming trip to Croatia with Zagreb's Archbishop Josip Bozanic and Split's Ante Juric. In October, the pontiff will visit Croatia to proclaim Cardinal Alojzije Stepinac "blessed," which is the first step toward sainthood. Many Croatian Catholics regard him as a martyr for his country and his faith under communism. Many Serbs view him as at least an accomplice in the Croatian Axis puppet state's persecution of Serbs and other minorities. PM


The government on 2 July approved a deal with the U.S. Bell Helicopter Textron company whereby it would guarantee a $1.45 billion bond issue to finance the purchase of 96 AH-1-RO Dracula helicopters based on the Cobra model, RFE/RL's Bucharest bureau reported. The decision meets the conditions of Bell Helicopter Textron for purchasing a 70 percent stake in the Gimbav Brasov aircraft plant. Finance Minister Daniel Daianu and at least two other ministers abstained from voting. The IMF last year criticized the deal as over burdening the state budget. MS


Meanwhile, an IMF mission has wrapped up a visit to Romania to evaluate the country's economic performance. An IMF press release at the end of the visit was non-committal about renewing loans to Romania and said an IMF mission may return in the fall to review the implementation of the government's reform program. On 2 July, Prime Minister Radu Vasile met with IMF chief negotiator for Romania, Poul Thompsen. An IMF communique released after that meeting praised "progress in applying the market mechanism to monetary policies" but warned that the budget deficit may "increase substantially in the absence of revenue-enhancing measures and expenditure savings." It also urged Romania to "give priority to the privatization of autonomous state- owned companies and restructuring the banking system." MS


Dumitru Postovan has submitted his resignation to parliamentary chairman Dumitru Diacov, who has yet to decide whether to accept it, Infotag reported on 2 July. The agency said his resignation is probably connected to the report released one day earlier by the State Audit Office, which revealed gross violations of financial and economic legislation among government agencies. Postovan is a close friend of former Premier Andrei Sangheli. Also on 2 July, the parliament set up a special commission to recommend measures following the findings of the State Audit Office. In other news, BASA-press reported the previous day that deputies representing the ruling coalition parties have submitted a draft law amending legislation on political parties. The amendment envisages raising the minimum number of members a party needs to register from 300 to 10,000. MS


Zachary Zhelyazkov, director of the Bulgarian Privatization Agency, told journalists in Sofia on 29 June that by the end of this year, 51 percent of the stock in the Bulgarian Telecommunications Company will be sold to private investors, while the rest of the shares will remain in the government's hands. He said the government hopes to find a "strategic investor" capable of modernizing and developing the company, an RFE/RL correspondent in Sofia reported. MS


by Liz Fuller

Developments in Georgia over the past several months have in effect ended the two-year period of political stability that followed the November 1995 parliamentary and presidential elections. The unsuccessful attempt to assassinate President Eduard Shevardnadze in February, the abduction of UN observers in western Georgia later that month (both of which were blamed on followers of the late President Zviad Gamsakhurdia), and the fighting between Georgian guerrillas and Abkhaz Interior Ministry forces in Abkhazia's southernmost Gali Raion in May, which precipitated the flight of some 35,000 ethnic Georgians, have all highlighted the country's weaknesses.

Opposition political figures seized upon the Gali debacle to unleash a torrent of criticism of the country's leaders. That criticism was not confined to the leadership's response to the fighting in Gali but also focused on festering problems that the Georgian authorities have so far failed to solve, including uneasy relations with Russia and the social and economic hardships resulting from economic reform.

Outraged by Shevardnadze's refusal to deploy Georgian troops to support the Georgian guerrillas and protect Georgian civilians, several opposition politicians went so far as to demand the president's resignation and new presidential and parliamentary elections. Perhaps the most vicious attack on Shevardnadze was by Socialist Party leader Vakhtang Rcheulishvili, who predicted that the president's failure to resign would lead to further losses of Georgian territories. He also blamed Shevardnadze for the marked deterioration in Georgian- Russian relations and for his subservience to the IMF, whose policies he termed devastating for the country's economy.

Meanwhile, the expulsion of the Georgian population from Gali has served as a catalyst for the consolidation of opposition forces around one of the country's most controversial politicians, Adjar Supreme Council Chairman Aslan Abashidze. Appointed to that position by Gamsakhurdia in 1991, Abashidze succeeded in preserving domestic political stability in his autonomous republic, whose location on the Black Sea coast bordering Turkey facilitated thriving cross-border trade that has led to the region's modest economic prosperity.

But Abashidze is regarded with mistrust by many Georgians because of his cordial relations with the sizable Russian garrison stationed in Batumi, the Adjar capital, and his imputed separatist ambitions. That mistrust prompted Georgian parliamentary deputies repeatedly to vote down legislation introduced by Abashidze's All-Georgian Union for Revival (the second-largest parliamentary group) calling for the creation in Batumi of a free economic zone. Advocates of such a zone claim it could generate millions of dollars for Georgia's still shaky economy.

In April, the Revival parliamentary group announced that it intends to boycott parliamentary sessions indefinitely to protest what it termed the obstructionist tactics of the majority Union of Citizens of Georgia, led by parliament speaker Zurab Zhvania. Revival's parliamentary group reaffirmed that intention at a congress in Batumi last week, to which representatives of all other opposition parties were invited. Addressing the congress, Aslan Abashidze lambasted the Georgian leadership, and Shevardnadze personally, for their inability to lead the country out of political and economic crisis. He also implicated Zhvania in the 9 February attempt to assassinate Shevardnadze.

To date, two other prominent opposition politicians-- Rcheulishvili and Laborist caucus head Shalva Natelashvili- -have aligned with Abashidze, who has hinted that the United Communist Party of Georgia (SGKP) may form an electoral alliance with Revival to contend the November 1999 parliamentary elections. Abashidze is perceived as a potential candidate for the presidential elections due the following year, as are Zhvania; Rcheulishvili; Djumber Patiashvili, Shevardnadze's successor as Georgian Communist Party first secretary; SGKP chairman Panteleimon Giorgadze; and Union of Georgian Traditionalists chairman Akaki Asatiani, who served as parliamentary speaker under Gamsakhurdia.

The Georgian leadership has only limited options available in the face of growing popular discontent. True, Shevardnadze has signaled his readiness to meet some of the opposition's demands, such as amending the constitution to redefine the duties of the Cabinet of Ministers and, specifically, the minister of state who heads that body. The present incumbent, former Communist apparatchik and Tbilisi Mayor Niko Lekishvili, is viewed as a mere figurehead. Moreover, for several years there have been persistent rumors of bad blood between him and Zhvania, who has been tipped to succeed Lekishvili and to be endowed with broader powers.

However, the issue crucial to stability--namely the nature of Georgia's future relations not only with Abkhazia but with the other autonomous formations of South Ossetia and Adjaria--is seemingly intractable. Shevardnadze has said repeatedly that he is prepared to offer all three territorial units varying degrees of autonomy within an "asymmetric federation"--an offer that Abkhaz President Vladislav Ardzinba has categorically rejected. The Abkhaz, for their part, are insisting that the repatriation of the Georgians who fled Gali in May must be conditional on lifting the restrictions in force on the Abkhaz border with the Russian Federation.

While Moscow is apparently siding with Georgia at present, many Georgians fear that as long as no permanent solution to the Abkhaz and South Ossetian conflicts is reached, Russia might use those conflicts as leverage against Georgia. Zhvania expressed his fears on that score in his address on the last day of the spring parliamentary session, warning that if, as alleged, Russia is pursuing a policy of encouraging the separatist aspirations of ethnic minorities in Georgia, including the Armenian community in the south of the country, the result could be a "catastrophe" for Georgia.