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Newsline - December 1, 1998


After announcing that the government will postpone submitting the 1999 budget to the State Duma from 1 December until 7 December, First Deputy Prime Minister Yurii Maslyukov revealed on 30 November that the cabinet will now wait until 10 December to discuss that document and will finally submit it two days later. According to Interfax, the government needs additional time to make calculations. For example, a proposal to lower value-added tax from 20 percent to 14 percent was approved on 27 November, but a regional association has asked the government to raise the 14 percent target to 15 percent and direct the additional proceeds to agriculture and the coal industry. "Kommersant-Daily" on 1 December published two versions of the budget showing that the Finance Ministry increased the deficit projection by 9.6 billion rubles ($537 million) to 104.5 billion rubles, 31.9 billion rubles of which the Central Bank will provide. JAC


The newspaper also pointed out that these figures would have to be recalculated again should the government manage to pry any money out of IMF Managing Director Michel Camdessus, who arrived in Moscow on 1 December, or win support among creditors for restructuring external debt. The daily concluded that Prime Minister Yevgenii Primakov has to wage battle over the budget on three fronts: with the IMF, legislators, and lobbyists within his own government. Finance Minister Mikhail Zadornov told reporters on 30 November that the government needs at least another $10.3 billion from the fund for 1999. "Izvestiya" on 1 December quoted "experts" as saying that if the government does not receive new credits from the fund during Camdessus's trip, then no new money can be expected before the middle of next year. JAC


On 30 November, Russian bank customers were supposed to have finally gained access to their savings after transferring their accounts from failing commercial banks to Sberbank. However, Sberbank announced that due to lack of cash and other "technical difficulties," depositors will have to wait until some future date, which will be announced by the Central Bank. Sberbank President Andrei Kazmin said during a radio broadcast, that his bank may never be able to cover accounts transferred from Inkombank, the "Moscow Times" reported on 1 December. The same day "Izvestiya" reported that according to its sources, Inkombank failed to fulfill several conditions for transferring its deposits to Sberbank and therefore its former customers should be "seriously" concerned. JAC


Moscow's TV-6 reported on 30 November that the St. Petersburg prosecutor-general has announced that it is seeking businessman Ruslan Kolyak on suspicion of involvement in the murder of Duma deputy and liberal activist Galina Starovoitova. Investigators believe that Starovoitova's death may be connected with the commercial activity of her son, who lives in Britain. Three days earlier, "Noviye izvestiya" published a transcript of what it alleged was a taped phone conversation that links St. Petersburg Governor Vladimir Yakovlev with organized crime. The paper reported that the tape had been in Starovoitova's possession. Governor Yakovlev told ITAR-TASS that the killing "is part of a large-scale effort to provoke social conflict and discredit law-enforcement agencies." On 27 November, Yakovlev appeared on television visiting Starovoitova's grave. He did not attend the funeral. JAC


The Duma's impeachment commission decided not to add a fourth charge of destroying the country's defense capability to the list of impeachable actions allegedly committed by President Boris Yeltsin, Commission Deputy Chairwoman Yelena Mizulina told reporters on 30 November. According to Mizulina, a member of the Yabloko faction, Yeltsin made mistakes but it is impossible to prove there was criminal intent. Oleg Sysuev, deputy head of the presidential administration, told reporters on 1 December that Yeltsin will return to his office "in the near future" and that doctors are finding it difficult to keep the president in the hospital. JAC


Human rights activists have expressed concern that Prime Minister Primakov's recent remarks about "the physical elimination of those who raise their hands against society, the public, and children" indicate that the government plans to lift its moratorium on the death penalty imposed after Russia joined the Council of Europe. Vladimir Kartashkin, chairman of the presidential human rights commission, told ITAR-TASS on 1 December that "various people at the highest level and also in the Prosecutor-General's Office, the Supreme Court, and the Justice Ministry are saying that we ought to lift the moratorium." Meanwhile, the Constitutional Court will consider a complaint that hundreds of cases in which the death- penalty was handed down should be overturned because they were issued in trials without juries, Interfax reported on 30 November. If the court upholds the complaint, then the majority of death-penalty cases in the country would be overturned. JAC


Russia has reduced its troops located in the northwest by more than 40 percent, thus fulfilling a pledge that Russian President Boris Yeltsin made to Sweden last year, Interfax reported on 30 November. Foreign Minister Igor Ivanov, who is visiting Stockholm and Oslo from 1-4 December, will raise the issue of Sweden and Norway's following suit with their own troop reductions, according to the agency. Meanwhile, Colonel-General Stanislav Petrov, chief of radiation, chemical, and biological protection forces at the Defense Ministry, told ITAR-TASS that an agreement has been signed with Germany for the provision of foreign aid to assist in the destruction of chemical weapons. He said that another agreement was about to be signed with The Netherlands, while negotiations with Italy, Finland, and Sweden are under way. The Federation Council will discuss a bill to exempt such assistance from tax and customs duties. JAC


The environmental organization Greenpeace reported on 30 November that mercury leaks from a chemical factory in Irkutsk have created an 18-mile ecological catastrophe zone, AFP reported. A regional court shut the factory down two months ago, but underground water poisoned by the mercury still flows into the Angara River. A Greenpeace spokesman said that the up to half a million people in the area have been poisoned to some degree. JAC


On 29 November, voters in the Republic of Tuva failed for the fourth time to turn up in sufficient numbers to make elections to the local legislature valid. A turnout of 50 percent of eligible voters is required. Tuva officials explained that voters are not apathetic but reluctant to venture out to polling stations because the weather is -42 degrees Celsius, Russian Public Television reported the next day. JAC


Despite media attention to the plight of regions in the Far East, Kamchatka Oblast continues to suffer from a severe shortage of energy supplies, Russian Radio reported on 30 November. The nuclear power plant at Petropavlosk-Kamchatkskii has only 24 hours' worth of fuel. A tanker carrying three days' supplies was expected to arrive on 1 December. Some residents are expected to have electricity for only eight hours a day. Meanwhile, "Izvestiya" reported on 28 November that closer to Moscow, residents in Alapaevsk, Sverdlovsk Oblast, have had neither gas nor heat for a week, while temperatures outside dipped to -40 degree Celsius. According to the daily, people with cars are keeping their children warm in their vehicles, while almost all schools and kindergartens are closed. JAC


Representatives of the nationalist Ittifak party and the Communist Party of Tatarstan agreed on 28 November to form a united political movement called Omet [Hope], RFE/RL's Kazan bureau reported. Gabdulla Galiulla, one of the leaders of Tatarstan's Muslims until February 1998, has been chosen as head of the movement. Omet declared its intention to propose joint candidates for the 1999 elections to the Russian State Duma and for the Tatarstan presidential elections due in 2000. LF


During their 30 November talks in Moscow, Igor Ivanov and Lamberto Dini exchanged information on Kurdistan Workers' Party leader Abdullah Ocalan, Reuters and Interfax reported. Ocalan was apprehended in Rome during the night of 12 -13 November on arrival from Moscow and may be sent back to Russia if his request for political asylum in Italy is refused and no other country demands his extradition. According to "Komsomolskaya pravda" of 1 December, Moscow opposes that option because it would adversely affect its relations with Turkey. Also on 30 November, some 50 Kurds staged a demonstration outside the U.S. embassy in Moscow to demand that Washington intervene to prevent Ocalan's "extermination" by Turkey, ITAR-TASS reported. LF


Meeting in Moscow on 25 November, CIS prime ministers endorsed CIS Executive Secretary Boris Berezovskii's proposal to implement an earlier decision on creating a CIS free economic zone (see "End Note," "RFE/RL Newsline," 24 November 1998). But they noted that Russia will not be able to ensure conditions for such a zone before 2000, according to Noyan Tapan. But several participants, including the representatives of Ukraine, Belarus, and Uzbekistan, rejected a further proposal by Berezovskii to rationalize CIS executive structures by merging the CIS Inter- State Economic Committee and the Executive Secretariat. Russian Prime Minister Primakov had sought to reassure his colleagues that the proposed creation of a new CIS executive organ "will not in any way be a supra-national government or an organ that could take decisions on behalf of CIS heads of state," "Nezavisimaya gazeta" reported on 27 November. LF


Five OMON (special police) officers were shot dead in an ambush on the administrative border between Chechnya and Dagestan late on 29 November, Russian agencies reported. Dagestani police said that the killers then fled to Chechnya, but Chechen Deputy Prime Minister Turpal Atgeriev laid the blame for the shootings on members of Dagestan's caviar mafia. LF


Cipco, the second international consortium to be established to exploit Azerbaijan's offshore oil reserves, announced on 30 November that it is terminating operations in Azerbaijan following the failure of three trial wells to yield the hoped-for reserves of oil, according to the Dow Jones News Service. The consortium was set up in November 1995 by Pennzoil, Agip, LUKoil and Azerbaijan's state oil company SOCAR to develop the Karabakh field. All three trial wells drilled in that field this year have yielded gas condensate but only the third well produced oil, though not in commercially viable quantities. LF


The Political Committee of the Parliamentary Assembly of the Council of Europe has drafted a proposal recommending Georgia's acceptance as a full member of that body, Reuters and ITAR-TASS reported on 30 November. The proposal characterizes Georgia as a pluralistic, democratic state but sets conditions for full membership, including ratifying the European Human Rights Convention and the framework convention on national minorities, and taking measures to safeguard the freedom of the press and improve the work of local authorities. Georgian press reports had suggested that Georgia's full membership might be contingent on measures to expedite the repatriation of Meskhetians deported from southern Georgia in 1944. LF


At its 18th congress on 26 November, the Self-Determination Union unanimously condemned as undemocratic the election law passed by the parliament on 16 November, Noyan Tapan reported. But congress delegates also approved measures aimed at amending that law, including an appeal to the Yerkrapah parliamentary group that drafted it and an alliance with other opposition groups. Parliamentary deputy speaker Albert Bazeyan (Yerkrapah) rejected charges by the former majority Hanrapetutiun faction that the vote on the law was undemocratic. Bazeyan added that Yerkrapah is currently holding talks with representatives of 16 parties, including the Communist Party of Armenia, that have proposed amendments to the law. LF


At a press conference in Tashkent on 30 November, Uzbek President Islam Karimov denied his country had any role in the rebellion in northern Tajikistan early last month (see "RFE/RL Newsline," 30 November 1998), ITAR-TASS and Interfax reported. Karimov said the fighting in Tajikistan's Leninabad Oblast was the result of an inter-clan struggle for power. He noted that while "there is no alternative" to the peace agreement signed in Moscow in June 1997, which, he pointed out, provides for "dividing portfolios between the Kulyab clan [in southern Tajikistan] led by [President Imomali] Rakhmonov and the United Tajik Opposition." Karimov said implicating his country in Tajikistan's problems is "an attempt to steer toward inter-ethnic and inter-state confrontation." He added "it's very convenient to find an outside enemy." BP


Karimov also said that drug-trafficking is conducted on a large scale in Tajikistan and that tons of narcotics are detained at the Uzbek and Kyrgyz borders with that country. "Both governing and law-enforcement bodies are involved in the drug business," he argued, warning that the "Uzbek-Tajik frontier will be strengthened and a visa regime introduced if necessary." The Uzbek president then implicated Russia's Federal Security Service (FSB) in the attempted rebellion, saying "certain Russian special services" are seeking to estrange Uzbekistan and Tajikistan. Karimov identified the FSB's Colonel Rizo Tursunov as coordinating measures to escalate tensions between Tajikistan and Uzbekistan. And he also claimed he had all the evidence necessary to prove Tursunov's role. The FSB released a statement later the same day expressing surprise at Karimov's comments and rejecting all accusations. BP


Askar Akayev paid a one-day visit to the Uzbek capital on 30 November to meet with his Uzbek counterpart, Islam Karimov, RFE/RL correspondents reported. The main aim of his visit was reportedly to seek to ensure uninterrupted supplies of Uzbek gas. Kyrgyzstan owes $3.3 million for supplies, and Uzbekistan has threatened to stop all deliveries on 1 December. The two sides reached an agreement whereby Kyrgyzstan will pay 70 percent of its gas debt by means of goods and hydro-electric power. BP


Following the close of registering for the 10 January presidential elections and with the field narrowed to four candidates (see "RFE/RL Newsline," 30 November 1998), incumbent President Nursultan Nazarbayev told a group of foreign diplomats the elections will be "just and democratic," Interfax reported on 30 November. Nazarbayev said he is "pained" by U.S. criticism of the election process, specifically the court decision barring former Prime Minister Akezhan Kazhegeldin from participating because of a minor offense. But he added that the U.S. statement "mixes two separate problems--one is [related to] specific election legislation, the second is the practical implementation of the laws of a country," ITAR-TASS reported. Pensioner Karishal Assanov, told RFE/RL correspondents on 29 November that he was withdrawing his candidacy for the elections as he did not wish to take part in the "farce" being organized in Kazakhstan. BP


ITAR-TASS reported on 29 November that there is a critical shortage in Tajikistan of supplies necessary for the winter. Compared with 1997, Tajikistan's coal supplies are down by half and domestic heating oil by 21 percent. Industries purchased less than half the oil they did in 1997, when there were also shortages. The government cannot afford to purchase additional supplies. Consumer goods are also reported to be in short supply, but 98 percent of those goods are dealt with by the private sector. Also, the government has already rationed electricity supplies to homes and industries. BP


Parliamentary speaker Oleksandr Tkachenko on 30 November said that the Supreme Council plans to start considering the 1999 budget on 2 December in order to adopt it no later than 25 December, Ukrainian News reported. "It will be far from the budget that would satisfy everyone but it will comply with all the requirements of the existing legislation," the agency quoted him as saying. He added that the government-proposed budget revenues could be increased by 20 percent "simply by improving the quality of tax collection." AP reported on 30 November that the parliamentary budget committee is revising budget figures to make the 1999 budget nearly deficit-free. In particular, the parliament has cut financing for the government and presidential administration. The revised draft budget provides for full payment of overdue wages and pensions. JM


The 30 November "Belorusskaya delovaya gazeta" reported that the government is trying to stave off a trade union protest action planned for 2 December. Some 30,000 people are expected to take part in the rally, which is being organized by five trade unions from the Belarusian Trade Union Federation. According to the newspaper, Mikhail Myasnikovich, who heads the recently established "national headquarters" to deal with the economic crisis, has proposed negotiations in exchange for the cancellation of the protest. The trade unions demanded that the government announced on television that negotiations will begin, but no such announcement was forthcoming. Meanwhile, Deputy Premier Uladzimir Zamyatalin ordered government officials to meet with trade union leaders to explain the government's anti-crisis policies. The newspaper concludes that the government's response testifies to its fear of mass protests. JM


The Belarusian Central Electoral Commission on 30 November refused to register a 1,117-strong group calling for a referendum on the creation of a Belarusian-Russian confederation (see "RFE/RL Newsline," 4 November 1998), RFE/RL's Belarusian Service reported. The commission claimed that the group's application contained false information with regard to where it held its constituent meeting. Belarusian Television reported that commission head Lidziya Yarmoshyna has proposed that the referendum initiative be examined by the Prosecutor- General's Office. JM


The trial of Vasil Staravoytau, former head of the Rassvet collective farm in Kirauski Raion, opened at a court in Mahilyou Oblast on 30 November, RFE/RL's Belarusian Service reported. The judge said the prosecution has submitted some 50 volumes of documentary evidence showing that Staravoytau created an "extortionist clique" that systematically robbed the state. If convicted, Staravoytau faces a prison term of up to 15 years. Staravoytau, who is 74 and suffered a stroke during his one-year pre-trial detention, collapsed in the courtroom steel cage in which he is to remain during the trial. The court rejected an appeal by the defense to release Staravoytau--a World War II veteran and the recipient of the Soviet Union's highest honors--on his recognizance. JM


Representatives of the opposition Moderate Party and People's Party have agreed to propose to their parties' boards and councils to launch a process that would lead to the merger of the two parties, ETA and BNS reported on 30 November. The first step in that direction would be drawing up a joint list of candidates for the March 1999 general elections. The two parties had originally planned to form an electoral alliance with the Fatherland union, but last month the parliament voted to ban such groupings (see "RFE/RL Newsline," 18 November 1998). Before that ban was announced, the three-party bloc led in opinion polls. JC


Nikolai Maspanov, the leader of the Russian Party in Estonia, has called on other parties and organizations representing Russian-speakers to join forces in what he called a "joint Russian ticket," ETA and BNS reported on 30 November. Maspanov told BNS that by making maximum use of voter potential, the Russian parties in Estonia could win up to 20 mandates in the March 1999 general elections. Those parties currently have a combined total of six seats in the legislature. Also on 30 November, BNS reported that the Russian Unity Party has appealed to other parties in the parliament to support amendments to the citizenship law, which are due to be put to the final vote this month. Under those amendments, stateless children who are under 15 and were born in Estonia after 26 February 1992 to stateless parents will virtually automatically be granted citizenship. JC


At its extraordinary congress on 28 November, the Democratic Party Saimnieks elected Andris Ameriks as its new chairman, BNS reported two days later. Ziedonis Cevers resigned from that post after the party's failure to clear the 5 percent hurdle in the 3 October elections. Cevers told the congress he will not take over any elected posts in the party. Speaking to BNS, Ameriks did not rule out the possibility that Saimnieks would join forces with another political group in the future "while preserving its identity." JC


The Lithuanian-Russian intergovernmental Cooperation Commission convened in Vilnius at the end of last week and completed drawing up seven agreements as well as a joint statement by the two countries' prime ministers on the liberalization of trade, BNS reported on 30 November. Russian Transportation Minister Sergei Franko, who together with Lithuanian Foreign Affairs Minister Algirdas Saudargas heads the commission, commented that the envisaged agreements will "surely stir up Lithuanian-Russian economic relations." According to the news agency, the commission also concluded that Lithuanian Premier Gediminas Vagnorius will visit Moscow "before long." JC


A government official said on 30 November that Poland will ask the EU for a 10-year transition period in order to fully liberalize its real estate market, PAP reported. The official said liberalization will take place without state interference but under state supervision. Real estate transactions in Poland last year amounted to 20.5 billion zlotys ($5.9 billion). JM


Visiting Slovak Defense Minister Pavol Kanis and his Czech counterpart, Vladimir Vetchy, signed in Znojmo, southern Moravia, on 30 November a protocol on cooperation in the armaments industry, CTK reported. Kanis said the same day that Vetchy informed him that Prague will deploy soldiers at its eastern border in order to step up the protection of the frontier, CTK reported. Vetchy said the step is "by no means one against Slovakia" but rather is aimed at preventing refugees from Eastern Europe and Asia from illegally crossing the frontier. Soldiers will probably also protect the Czech-Austrian border, Vetchy said. He added that he is currently discussing the setting up of patrols by both the military and the border police with Interior Minister Vaclav Grulich. MS


The European Commission on 26 November said it regretted the Czech government's decision earlier that day to lift preferential duties on EU pork imports, thereby raising the import tariff from 15 percent to more than 40 percent. On 27 November, Czech farmers protested cheap imports from the EU, blocking traffic in smaller towns and villages across the country. They argued that the measures announced by the government the previous day were insufficient. MS


Visiting Hungarian Transport Minister Kalman Katona and his Slovak counterpart, Gabriel Palacka, agreed on 30 November to rebuild a bridge between Esztergom and Sturovo by 2002, Hungarian media report. Katona said Palacka assured him that he will sign an agreement already ratified by Hungary and the EU, under which the European Commission will assist in rebuilding the bridge to the tune of 5 million ecus ($5.7 million). Experts from the two ministries will meet on 4 December in Esztergom to discuss technical issues. MSZ


Beatrix Hingyi, daughter-in-law of Jozsef Torgyan, who is chairman of the Independent Smallholders' Party and minister of agriculture, has resigned her post on the board of state-run Hungarian Airlines, some two weeks after her appointment. Her mother also gave up her post as a board member of the lottery company Szerencsejatek. Torgyan said the resignations were in response to criticism in the media and the parliament. He refused to comment on a suggestion that Prime Minister Viktor Orban had initiated the resignations. MSZ


Reuters on 1 December quoted unnamed U.S. diplomats as saying that "U.S. observers have agreed to give an armored escort to Serb police patrols that run through hostile territory to [Malisheva] and keep the [Serbian paramilitary] police base [there] provisioned." The agency also reported that an unnamed senior U.S. official said "the escorts make the Serbs feel more comfortable as they haven't been attacked while we've been accompanying them." U.S. diplomat William Walker, who heads the OSCE verification mission in Kosova, recently urged Yugoslav President Slobodan Milosevic to withdraw the local police garrison, which was not stationed in Malisheva before the current conflict. Milosevic said he will consider pulling the garrison out but stressed the need to prevent the Kosova Liberation Army (UCK) from retaking the area. U.S. diplomats reportedly decided to escort the police to prevent the UCK from regaining the upper hand. PM


Walker told a press conference in Prishtina on 30 November that he expects all 2,000 unarmed OSCE "verifiers" to have arrived in Kosova by 1 January. He added that "bringing in 2,000 people from 54 countries is not an easy function. We will be up and operational in a very robust fashion within the next few weeks." Walker also noted that a political settlement must be in place before the monitors can begin one of their most important tasks, namely organizing elections for offices to be determined in the political settlement. U.S. envoy Chris Hill has put forward a draft plan that would give Kosova a high degree of autonomy at the provincial level, but a Serbian draft concentrates autonomy at the local level and gives all ethnic groups an equal political voice, regardless of their respective sizes. In recent days, at least three top Serbian officials have publicly said that Hill's plan is unacceptable, RFE/RL's South Slavic Service reported. PM


Paskal Milo told Reuters in Copenhagen on 30 November that "it is important for the Albanians in Kosova to play a part in their own future. The UCK is going to be seen now as a political factor, not as military one." He was referring to a statement by UCK political representative Adem Demaci that his group is ready to "temporarily" renounce demands for full independence in exchange for an "interim" status as a federal Yugoslav republic (see "RFE/RL Newsline," 30 November 1998). Milo stressed that "all the main [ethnic Albanian] parties and [politicians] are convince [the UCK] that it is not the time to ask for independence." He added that the UCK must become "much more realistic, moderate..., [and willing to seek] compromises.... We do not have any other solution than...through dialogue." FS


A police spokesman in Sibenik said on 30 November that police have discovered arms and ammunition worth $1 million in warehouses near the harbor. The goods had arrived from Bosnia and were awaiting shipment to the Albanian port of Durres and then on to Kosova. Police arrested four Bosnians and a Croat in conjunction with the incident, but five other suspects, including at least one Kosovar, remain at large. Interior Minister Ivan Penic said in Zagreb that it was the largest weapons-smuggling operation yet uncovered in Croatia and that the operation was the work of organized criminal groups. PM


Vladimir Seks, who is the parliamentary faction leader for the governing Croatian Democratic Community (HDZ), said in Zagreb on 30 November that President Franjo Tudjman will soon meet with representatives of the opposition coalition of six parties. Seks added that opposition demands for changes in the electoral law and for a parliamentary investigation of the secret services will be on the agenda. He added that Tudjman will meet separately with representatives of other opposition parties, which are mainly tiny, right-wing groups. On 28 November, opposition coalition leader Vlado Gotovac said that the leaders of the six parties want to meet with Tudjman in his capacity as head of the HDZ and not as head of state. He added that they do not want members of the right-wing groups to be present. "Novi List" wrote on 30 November that the HDZ and opposition alike are playing "tactical games" in the runup to the talks, which, the Rijeka daily noted, may never take place. PM


Croatian Foreign Minister Mate Granic and his Slovenian counterpart Boris Frlec told a press conference near Ljubljana on 30 November that their one-day meeting succeeded in clearing up all but one of the outstanding questions involving the demarcation of their common land border. They did not specify which issue remains, but Frlec noted that the two solved the dispute over the Sveta Gera mountain peak, RFE/RL's South Slavic Service reported. The two sides hope to have a solution by Christmas to their most important border problem, namely the maritime frontier in the Gulf of Piran, "Novi List" quoted Granic as saying. An agreement will probably be signed soon on the ownership and use of the Krsko nuclear power plant, which is in Slovenia but was built partly with Croatian funding. Granic added, however, that the dispute over Croatian accounts in a Slovenian bank will most likely go to international arbitration. PM


Hard-line deputy Dragan Kalinic, whom Republika Srpska President Nikola Poplasen has asked to form a government, said in Banja Luka on 30 November that he has not yet succeeded in putting together his cabinet. Spokesmen for the Social Democrats called on Kalinic to let someone else try to form a government because the hard-liners lack a majority in the assembly, an RFE/RL correspondent reported from the Bosnian Serb capital. The office of the international community's Carlos Westendorp wants a government led by moderate Serbs with the backing of Muslim and Croatian deputies. PM


A dispute continues between Muslim and Serbian forensic experts over the identification of 55 sets of remains exhumed recently in two cemeteries in the Bosnian capital, Reuters reported on 29 November. Bosnian Serb officials charge that the persons were Serbian civilians who were killed by Muslims during the 1992-1995 Serbian siege of Sarajevo, according to "Vesti." Muslim spokesmen argue that the identity of the dead has not been determined and that they were most likely killed by renegade Bosnian army units commanded by Musan Topalovic "Caco." PM


Special police forces killed a local policeman in a shoot-out near Shkodra on 29 November, AP reported. The local policeman and two of his colleagues had taken a customs official hostage and begun shooting at the special police units. Those police forces had seized three trucks loaded with 60 tons of corn and coffee smuggled into the country from Montenegro. The dead policeman's brother was wounded in the shoot-out. FS


Spokesman for both the Foreign and Defense Ministries on 30 November denied any knowledge that Iraqi officials visited Bucharest in May in a bid to purchase ballistic- missile guidance systems from the Romanian Aerofina company. In a statement released to the press, Aerofina said a CNN report on 29 November was "erroneous." According to that report, the negotiations lasted a week before ending in failure and were monitored by the intelligence services of the U.S., Romania, and Israel. Romanian Ambassador to the U.S. Mircea Geoana has confirmed the report, telling CNN that Aerofina negotiated with Iraq in 1995 and that those responsible for those negotiations had been "rapidly and severely reprimanded." Geoana said that last May, Iraq tried to renew those contacts. Former Premier Nicolae Vacaroiu and former Defense Minister Gheorghe Tinca have both denied that in 1995 Romania broke the embargo against Iraq. MS


The Legionary Movement, also known as the Iron Guard, plans to register as a political party in June 1999, Mediafax reported on 29 November, quoting Nicador Zelea Codreanu, a nephew of the fascist movement's interwar "Captain," Corneliu Zelea Codreanu. Nicador Zelea Codreanu said the new party will be called the National Union for Christian Rebirth because the authorities would not allow the movement to register under its old name. A crowd of very old and very young "Guardists" gathered in a forest at Tancabesti, near Bucharest, on 29 November to mark the 60the anniversary of the assassination of Corneliu Zelea Codreanu there on the orders of King Carol II. MS


An extraordinary congress of the Democratic Agrarian Party of Moldova (PDAM) elected Anatol Popusoi as its new chairman on 27 November, Infotag reported. Popusoi is considered to belong to the PDAM's conservative wing. He replaces Dumitru Motpan, who resigned after taking responsibility for the party's disastrous performance in the May 1998 elections. Formerly the largest parliamentary group, the PDAM failed to win representation in the new legislature. MS


The government on 30 November approved a draft law that would remove three zeroes from the national currency, the lev, as of 1 July, Reuters reported. The draft law implements a decision taken in August by the cabinet and the Currency Board (see "RFE/RL Newsline, 10 August 1998). Finance Minister Muravei Radev said the government does not expect inflation to rise because of the re-denomination. MS


by Floriana Fossato

The Moscow city government's budget meeting last week was dominated by two issues: how to maintain services amid the deep economic turmoil in the country and where to get the necessary funds to guarantee existing city programs. For the populist mayor of Moscow, Yurii Luzhkov, the realization that the Moscow city government's once-bottomless coffers are running dry poses several important challenges.

The first of those challenges is economic. Until recently, Moscow was considered an island of relative prosperity in a sea of economic disarray. But as Russia's economic crisis deepens, both the image of the Moscow miracle and Luzhkov's reputation as one of the few Russian political bosses who can get things done are rapidly coming under threat. Political analysts say that to preserve his image, Luzhkov the populist has to transform himself into Luzhkov the realist.

At the meeting of the Moscow city government on 24 November, deputy mayor Yurii Razlyak said that projected budget revenues in 1999 will be the same or even less than this year. Other city officials said the situation is made worse by the fact that tax collection is shrinking dramatically. And in order to service some $1.5 billion in foreign debt, Moscow will have to pay $120 million in 1999, which, according to city officials, is equal to 45 percent of the city's hard-currency reserves. One of Luzhkov's most persistent critics, Aleksei Ulyukaev, deputy director of the Institute for the Economy in Transition, told RFE/RL that "Moscow's budget situation is very serious," adding that "the real base of the budget is shrinking."

Luzhkov's second challenge stems from the dilemma over how to introduce unpopular measures without damaging his position as one of the main contenders for the Russian presidency. Political analysts say that Luzhkov's launching in mid-November of a political movement, Otechestvo [Fatherland], represents the opening of his presidential campaign. Having decided to abandon a short and largely unproductive flirtation with the Communists, Luzhkov said his movement will "absorb everything that is logical from the left and everything that is logical from the right" but will "avoid all radicalism either of the right or the left."

Acutely aware of the need to maintain social services despite Moscow's economic troubles, Luzhkov told city officials at the 24 November city government meeting that social programs, including plans to build new schools and medical clinics in Moscow, should continue. Financial officials replied that funds to make up for the shortfall in tax revenues could come from new Western credits, from increased revenue earned by government- controlled alcohol sales, or from the introduction of a new sales tax and other unpopular fiscal measures. Saying that fresh Western credits should be avoided, Luzhkov was forced to approve some unpopular moves.

Among those moves is an increase by one-third of monthly Moscow city travel cards beginning in January. Moscow apartment rents and utilities will rise by 30-50 percent over the next few months. And the cost of water will increase 45 percent in December, while rents will go up another 50 percent next April and heat and electricity by 30 percent next July.

According to Ulyukaev, unpopular measures have been taken but "without too much publicity." He added that Luzhkov's social program for Moscow is unrealistic and "financing it will be difficult, but [for political reasons] it must continue until the presidential elections."

At the city government meeting, Luzhkov also introduced a new colleague, President Boris Yeltsin's former spokesman, Sergei Yastrzhembskii, who was abruptly fired in mid-September. Following much speculation, Yastrzhembskii was appointed Luzhkov's deputy in charge of public relations and regional and international affairs. Yastrzhembskii, for his part, has not denied Russian media reports that he was fired by Yeltsin for promoting the Moscow mayor as a candidate for prime minister over Yevgenii Primakov. (Other former Yeltsin aides, including ex- Security Council chief Andrei Kokoshin and former Interior Minister Anatolii Kulikov have also joined forces with Luzhkov.)

Russian media had suggested that Yastrzhembskii would be brought into the Moscow government to promote Luzhkov in his presidential bid. In the past, the former presidential spokesman was widely credited with giving a smooth, professional face to the Kremlin press service and frequently rescuing Yeltsin from his own words and actions.

Attending his first city hall meeting last week, Yastrzhembskii did not rule out the possibility of assuming the role of Luzhkov's new image maker. He warned journalists that the race for the presidency has not yet officially started but said that if he were asked to help Luzhkov, he would certainly do so. "If the electoral trumpet sounds, I think I will take part in this campaign," he commented. The author is a Moscow-based RFE/RL correspondent.