GUSINSKII CLEARED OF CHARGES, LEAVES COUNTRY...
The Prosecutor-General's Office announced on 27 July that it has discontinued criminal proceedings against Media-MOST head Vladimir Gusinskii, who left Russia for Spain the previous day. One of Gusinskii's lawyers said he wished to be reunited with his family, who live there. According to Gusinskii's press spokesman, the fraud case against Gusinskii has been dropped, although criminal investigations into Russkoe Video will continue. On 28 July, President Putin is scheduled to meet with Russia's business leaders; however, Gusinskii was not invited, nor was his longtime foe, Boris Berezovskii. Former Sibneft head and State Duma deputy Roman Abramovich will also not be present. "Segodnya," which is owned by Gusinskii's Media-MOST, reported on 26 July that a recent Finance Ministry investigation revealed that Sibneft paid considerably less in tax than other oil companies--in fact, eight times less than Sidanko or Surgutneftegaz. JAC
...AS FELLOW BUSINESS LEADERS HAVE PRE-MEETING MEETING
Berezovskii's "Nezavisimaya gazeta" on 26 July reported that Russian business leaders held a meeting with Prime Minister Mikhail Kasyanov on 24 July, two days before the important vote in the Federation Council on federation reform measures and additions to the Tax Code. According to the daily, the government was seeking the business executives' help since the latter have "good links with regional administrations." On 25 July, each person attending the meeting reportedly received a note urging them to take action to pass the tax code the following day. JAC
FEDERATION COUNCIL GIVES PUTIN PARTING GIFT...
Senators on 26 July voted overwhelmingly to pass a bill implementing the second part of the tax code. The vote was 128 in favor, 13 against, and nine abstentions, according to Interfax. The previous day, Prime Minister Kasyanov told "Vedomosti" that he was sure that the "senators are most of all interested in what will turn the economy around." Others were less sure, however, and most analysts and newspapers had predicted that the Federation Council would reject the bill if only out of pique at President Vladimir Putin, who has considerably chipped away at their powers through his federation reforms (see "RFE/RL Newsline," 20 July 2000). "Vedomosti" reported on 26 July that the government had promised the senators that if they passed the tax laws, the government would reconsider the issue of the region's lost budget revenues in the draft 2001 budget (see also "End Note" below). JAC
...AS BATTLE OVER 2001 BUDGET LOOMS
Also on 26 July, the upper house passed a resolution criticizing the draft 2001 budget, Interfax reported. According to that resolution, the draft's main shortcoming is the absence of clear strategic guidelines. Senators also noted that budget forecasts indicate that the tax revenues of regional budgets will shrink significantly. Specifically, according to "Vedomosti," the government calculates that the budgets of six donor regions, Moscow, St. Petersburg, Krasnoyarsk Krai, Samara Oblast, and the Khanty-Mansi and Yamalo-Nenets Autonomous Okrugs, will suffer losses of 1 billion rubles ($36 million) each. At the same time, 55 regions will see higher budget flows. This redistribution is intended to even out the income discrepancies between regions: according to the daily, some regions are 25 times wealthier than others. JAC
...AND POTENTIAL UNREST IN REGIONS IS PREDICTED
Federation Council members voted to reject the third bill of President Putin's package of measures reforming the Russian Federation. That bill would allow the president--but not governors of oblasts or presidents of autonomous republics--to dismiss mayors and local administration leaders under certain circumstances. The vote was 92 against and 12 in favor, "The Moscow Times" reported on 27 July. Senators recommended that the bill be sent to a conciliatory commission. The Moscow Carnegie Center's Andrei Ryabov told the daily that although the governors appeared to be in a defeatist mood, they are not yet defeated. "They lost the away game. Now there will be a return match on the local fields," he said, explaining that some governors might respond to the Kremlin by refusing to defuse unrest at home and deflecting the blame for social and economic problems on Moscow. JAC
FAR EAST MAYOR APPEALS TO PUTIN TO RESOLVE ENERGY CRISIS...
The mayor of Nakhodka, Viktor Gnezdilov, has sent a special appeal to President Putin about the emergency situation in his home town as a result of the chronic electricity blackouts over the past week, Interfax-Eurasia reported on 26 July. Nakhodka is a port town in Russia's Far East located in Primorskii Krai. According to the mayor's press service, the mayor complained that the outages were destabilizing the area. And he argued that a resolution of the electricity problem must be achieved at the federal level. He warned that people in the area are ready to block the TransSiberian highway. Earlier in the week, protestors in Nakhodka blockaded a highway to protest electricity reductions to their residences (see "RFE/RL Newsline," 25 July 2000). JAC
...AS MILITARY INSTALLATIONS COMPLAIN OF CUT-OFFS
The Defense Ministry expressed concern about the shortage of electricity to military facilities located in Primorskii Krai, ITAR-TASS reported on 26 July. Last week, the electricity supply to more than 40 units and sub-units of the Pacific Fleet was cut off for between one-and-a-half and nine hours a day, the fleet's press service told Interfax-Eurasia the same day. According to that press service, military exercises and the maintenance of military equipment and weapons are being halted, and combustible and lubricating materials, of which the fleet has only limited supplies, are also being used "excessively." Primorskii Krai Governor Yevgenii Nazdratenko responded to the situation in his area that day by declaring that local residents have the legal right to seek compensation for moral and material damage from Dalenergo. He said that the company bears full responsibility vis-a-vis the residents of the krai. JAC
PUTIN RECEIVES AZIZ IN MOSCOW
President Putin assured visiting Iraqi Deputy Prime Minister Tariq Aziz in Moscow on 26 July that Russia will continue to seek to have international sanctions against Iraq lifted. At the same time, Putin noted that Moscow's support would be more effective if Iraq were to fully abide by its commitments to the UN to allow UN weapons monitors to work unimpeded. According to Putin's foreign affairs adviser Sergei Prikhodko, the Russian president criticized the U.S. and Britain for continuing to launch air strikes against Iraq. Aziz also met with Prime Minister Kasyanov, who stressed that Russia intends to further develop its cooperation with Iraq, and Security Council Secretary Sergei Ivanov. So far, Moscow has refrained from responding to a U.S. State Department spokesman's comment on 26 July that Washington regards such visits as inappropriate. JC
KIM TO SEE RUSSIA BY TRAIN
Russian Foreign Minister Igor Ivanov announced on 26 July that North Korean leader Kim Jong-il has agreed to visit Russia and will travel by train from Pyongyang to Moscow via Vladivostok, ITAR-TASS and Western agencies reported. Ivanov noted that the dates for Kim's trip have still to be determined. The previous day, Primore Governor Nazdratenko had said that Kim would visit Vladivostok in early September (see "RFE/RL Newsline," 26 July 2000), although agencies later quoted his spokeswoman as saying North Korea had not officially confirmed Kim would come. Also on 26 July, the Federation Council ratified the friendship treaty with North Korea. The lower house had put its seal on the document last week, during Putin's visit to Pyongyang (see "RFE/RL Newsline," 20 July 2000). JC
IRAN INVITES RUSSIAN OIL CONSORTIUM TO PROSPECT IN ITS SECTOR OF CASPIAN
The Caspian Petroleum Company created on 25 July by Gazprom, LUKoil and Yukos on a parity basis, has been invited by the Iranian government to conduct exploration work in the shallow-water part of Iran's sector of the Caspian, Interfax and Turan reported on 26 July. The company, which will be based in Astrakhan, will also be involved in exploration and development in the northern Caspian. LF
Confederation of Peoples of the Caucasus President Yusup Soslambekov died in Moscow on 27 July of bullet wounds to the head, Turan reported. A Chechen who had liased between President Aslan Maskhadov and the Russian leadership, Soslambekov was shot in the street in Moscow 10 days ago (see "RFE/RL Newsline," 19 July 2000). His assailant escaped. LF
MOSCOW URGES 'PRAGMATISM' AND 'RESPONSIBILITY' IN MID-EAST PEACE TALKS
Following the collapse of the Camp David summit, the Russian Foreign Ministry on 26 July issued a statement urging "pragmatism and a high degree of responsibility from all political forces and circles of society in Israel and the Palestinian territories." Moscow, which is a co-sponsor of the Middle East peace process, continues to "actively support" the promotion of Palestinian-Israeli talks with the aim of securing peace in that region, the statement noted. JC
FEDERATION COUNCIL APPROVES KEEPING PEACEKEEPERS IN BOSNIA
The upper house of the parliament has approved President Putin's proposal that Russian peacekeepers continue to serve in Bosnia-Herzegovina until 31 July 2001, Interfax reported on 26 July. That contingent numbers up to 1,200 troops. JC
IMF SAYS NEW ALLEGATIONS NOT NEW
IMF chief spokesman Thomas Dawson, speaking to reporters on 26 July, dismissed news reports that a Swiss magistrate is questioning banks in Switzerland about the possible transfer of $4.8 billion in IMF funds out of Russia, saying those reports are just a "rehash" of old allegations, AP reported. The Italian daily "Repubblica" claimed recently that $4.8 billion left the U.S. Federal Reserve, but instead of going to the Russian Central Bank, it was "laundered," disappearing in secret accounts without ever reaching Russia. Dawson said the allegations are exactly those previously refuted by a PricewaterhouseCooper audit (see "RFE/RL Newsline," 6 August 1999). JAC
WOMAN TAPPED FOR TOP ECONOMIC POST...
Bella Zlatkis, head of the Domestic Debt Department at the Finance Ministry, will be named deputy finance minister this week, Finance Minister Aleksei Kudrin announced on 26 July. Zlatkis has been with the ministry since 1970 and has overseen the market for short-term treasury bonds or GKOs. JAC
...AS ANOTHER ST. PETERSBURGER PICKED FOR FSB
A decree signed on 12 July by President Putin named Lieutenant General Vladimir Shults as deputy director of the Federal Security Service (FSB), ITAR-TASS reported on 25 July. Shults, 52, was born in Sverdlovsk Oblast and educated at Leningrad State University. From 1992, he was deputy chief of the FSB's Saint Petersburg and Leningrad Oblast department. From 1995 to 1999, he was deputy chief and later chief of the Federal Security Service Academy. JAC
INDEPENDENT RADIO JOURNALIST KILLED
Sergei Novikov, the head of an independent radio station in Smolensk, was shot and killed instantly in his house, ITAR-TASS reported on 27 July. The unknown assailant or assailants used a silencer, according to the agency, quoting police officials. The radio station, called Vesna, was openly critical of local authorities, and some residents are linking that stance to Novikov's murder. JAC
CHERKESS AGAIN PROPOSE BEREZOVSKII AS DUMA CANDIDATE
The organization Adyge-Khase, which represents the Cherkess minority population of the Republic of Karachaevo-Cherkessia, on 26 July proposed the candidacy of Boris Berezovskii for the 10 December by-election to the State Duma seat left vacant by Berezovskii's recent resignation, "Nezavisimaya gazeta" reported. Berezovskii was elected to represent Karachaevo-Cherkessia in the State Duma last December. The republic's Cherkess population consider him the sole Russian politician capable of resolving the tensions between the republic's Karachai President Vladimir Semenov and his defeated Cherkess rival Stanislav Derev. LF
ARMENIAN PARLIAMENT GIVES GO-AHEAD FOR ENERGY PRIVATIZATION
Following a stormy three-day debate, deputies voted on 26 July by 64 to 38 to approve new government proposals for the conduct of a tender between four international companies to privatize four state-run energy distribution networks, RFE/RL's Yerevan bureau reported. Deputies had blocked the tender in April to protest the exclusion of a subsidiary of Russia's Gazprom from the companies shortlisted (see "RFE/RL Newsline," 19 and 26 April 2000). The World Bank, which has made disbursement of further badly-needed credits contingent on the privatization, criticized that move (see "RFE/RL Newsline," 15 May 2000). Deputies representing the Republican Party (HHK), the Kayunutiun faction and the Armenian Revolutionary Federation--Dashnaktsutiun (HHD) voted in favor of the government bill, while the People's Party, which is the HHK's partner in the majority Miasnutiun coalition, the Communists, and the Right and Accord faction voted against. LF
DEFEATED CANDIDATE CHALLENGES FINAL RULING ON ARMENIAN BY- ELECTION OUTCOME
The Armenian Constitutional Court ruled on 26 July that HHD candidate Kim Balayan is the winner of the contested 9 July by-election in a Yerevan constituency, and that he was not responsible for irregularities adduced by rival candidates who challenged the poll outcome RFE/RL's Yerevan bureau reported. The election of Balayan, a qualified lawyer, raises to nine the number of deputies in the HHD faction. On 24 July, Artur Mirzoyan, a proxy for defeated candidate Yeghia Shamshian, told journalists that the decision by a local court to uphold Balayan's victory was groundless and a violation of the Armenian Electoral Code, Armenpress reported. LF
TWO AZERBAIJANI OPPOSITION PARTIES FORM ELECTION BLOC...
At a 26 July meeting in Baku of the 10 opposition parties aligned in the Democratic Congress, the Azerbaijan Popular Front and Musavat parties reached agreement on fielding a joint list of candidates in the 5 November parliamentary elections, Turan reported. Both parties have, however, said they will contend that ballot only if the existing election legislation is amended to ensure that the polls and free and democratic (see "RFE/RL Newsline," 25 July 2000). Also on 26 July, a spokesman for the Union of Azerbaijani Forces, which comprises the small left-wing Vahdat, Namus and Social- Democratic Parties, told Turan they too intend to boycott the 5 November poll if no "positive changes" are made to the electoral legislation. LF
... AS AUTHORITIES AGAIN REJECT U.S. CRITICISM
But Mubariz Gubanly, a leading member of the ruling Yeni Azerbaycan party, said on 26 July that the leadership will not yield to U.S. criticism of the laws. He termed that criticism "non- objective" and one-sided and said the U.S. State Department's assessment of the situation in Azerbaijan is "superficial," AP reported (see "RFE/RL Newsline," 25 and 26 July 2000). Meanwhile the Central Electoral Commission on 26 July published a list of mostly government-sponsored newspapers which, together with state radio and television, will publish political parties' election programs, Turan reported. LF
AZERBAIJAN OPPOSITION PROTESTS PICKETERS' ARREST
Eleven opposition parties on 26 July issued a statement protesting what they termed the "illegal" 24 July arrest of three young members of the Azerbaijan National Independence Party (AMIP), Turan reported. The young men were picketing the home of parliament deputy Shamil Gurbanov to protest insulting remarks he had made about AMIP chairman Etibar Mamedov. AMIP deputy chairman Nazim Imanov termed the arrest "political persecution." LF
AZERBAIJAN-UZBEKISTAN GOVERMENT COMMISSION MEETS
During a 25 July session of the Azerbaijan-Uzbek intergovernment economic commision in Baku, Azerbaijan's First Deputy Prime Minister Abbas Abbasov and his Uzbek counterpart Rustam Yunusov signed bilateral agreements on cooperation in combating crime and on simplifying customs procedures, Turan and "Nezavisimaya gazeta" reported. Referring to the opening next month of the transport corridor across the Caucasus and Central Asia, via Uzbekistan, to China, Yunusov proposed a program of measures to coordinate the work of Poti, Baku, Turkmenbashi and several Chinese ports. LF
GEORGIA, TURKISH FOREIGN MINISTERS DISCUSS SOUTH CAUCASUS
Meeting in Trabzon on 24-26 July, Irakli Menagharishvili and Ismail Cem discussed the planned pipelines to transport Caspian oil and gas via Georgia to Turkey, the optimum configuration for the proposed South Caucasus Stability Pact, military cooperation, and integration with NATO and European organizations, Caucasus Press reported. Cem assured his Georgian colleague that Ankara is prepared to play a more active role in the search for a solution to the deadlocked Abkhaz conflict. On 27 July, "Nezavisimaya gazeta" castigated Turkish Minister of State Abdulhaluk Cay for comparing Russia's actions in Chechnya to Hitler's annihilation of Germany's Jews. Conceding that Cay's remarks do not reflect official Turkish policy, the paper commented that Turkey's regional policy is clearly showing its leadership's panic and paralysis in the face of a more assertive Russian policy in the Caucasus. LF
KAZAKH OFFICAL'S ARREST CONNECTED TO MURDER CASE?
According to an unconfirmed Kazakh news agency report, Isa Koshkarev, who is chairman of the state-owned KazExport, was taken into custody on 25 July, RFE/RL's Kazakh Service reported the following day. Local observers say Koshkarev's arrest may be connected with the murder in April 2000 of KazExport official and arms export expert Talghat Ibraev. Several arrests have already been made in connection with that killing (see "RFE/RL Newsline," 18 April, 22 May and 6 June 2000). LF
KYRGYZ PRESIDENT 'UNDECIDED' ABOUT SEEKING SECOND TERM
In an interview published in "Kommersant" on 26 July, the first day of his two-day state visit to Russia, Askar Akaev explained his hesitation to announce formally that he intends to contend the 29 October presidential poll to the need first to complete "important and urgent tasks." Among those tasks Akaev cited his current trip to Russia, during which he and Russian President Vladimir Putin are to sign a declaration of eternal friendship between their two countries and a ten-year economic cooperation agreement. LF
TURKMENISTAN TO RESUME GAS SUPPLIES TO UKRAINE...
Turkmenistan's Deputy Prime Minister Yolly Gurbanmuradov and his visiting Ukrainian counterpart Yuliya Timoshenko signed a preliminary protocol on gas supplies for the period 2000- 2010, Interfax reported. Kyiv will purchase 20 billion cubic meters of gas this year, and 50 billion cubic meters annually for a ten-year period thereafter, at a price of $42 per thousand cubic meters. As under previous agreements, payment will be partly in cash and partly in goods and services. According to "Nezavisimaya gazeta" on 27 July, Timoshenko did not try to bargain over the price Ashgabat asked. LF
...PROVIDED UKRAINE DOES NOT ANNUL AGREEMENT
Ukrainian President Leonid Kuchma has already cast doubt on that protocol, however. Kuchma said in Simferopol on 27 July that he "has prohibited the signing of any documents" on Turkmen gas deliveries, adding that such "agreements on principle" should be signed only by the presidents of both countries. "This is nothing short of deception," he said, noting that the final price of Turkmen gas, including its transportation costs to Ukraine, may amount to $90-$105 for 1,000 cubic meters. JM
BELARUS, CHINA NOTE FULL UNDERSTANDING ON GLOBAL ISSUES
Following his talks with Chinese Vice President Hu Jintao in Minsk on 26 July, Belarusian President Alyaksandr Lukashenka said China is Belarus's strategic partner, adding that the two countries have a common position on global issues and oppose "hegemonic strivings" in the world. "On all external policy issues, we have positions absolutely coinciding with those of Belarus--on NATO's expansion, non-proliferation of nuclear arms, non-interference into internal affairs of states, and a multi-polar world," Reuters quoted Hu as saying. Hu added that "we intend to intensify our support for democratic Belarus and categorically oppose interference by other states in its internal affairs, whatever the pretext." JM
MINSK-MOSCOW-BEIJING AXIS BECOMING REALITY?
Lukashenka also noted on 26 July that the rapprochement between Beijing and Moscow gives substance to his idea of forming an alliance between Belarus, Russia, and China. "While earlier many in Russia laughed at [the Minsk-Moscow-Beijing alliance idea], today, after Russian President Vladimir Putin's visit to China, this [idea] is becoming reality," Belapan quoted Lukashenka as saying. "We have confirmed our resolution to support the PRC's interests on the European Continent," Lukashenka noted. JM
BELARUS'S STATE BROADCASTING COMPANY GETS NEW CHIEF
Lukashenka has appointed Viktar Chykin, head of the pro- government Communist Party of Belarus, as chief of the State Television and Radio Company. "I think the character traits that he has already demonstrated--humanness, perseverance-- are indisputable," Lukashenka told journalists. As Minsk's deputy mayor, Chykin has become notorious for banning many opposition rallies in the capital's center and dealing harshly with meetings he has authorized. "[Chykin's appointment] shows that on the eve of the election season, the Lukashenka regime is not going to loosen [its grip], is not even going to pretend liberalization," opposition leader Vintsuk Vyachorka told RFE/RL. "The appointment of the man who banned rallies [and] let dogs loose on demonstrators...is another proof that this regime wants only one thing-- unlimited power and unlimited dictatorship--and will continue to lie, lie, and lie," Belarusian filmmaker Uladzimir Khalip commented. JM
EBRD PONDERS $200 MILLION LOAN TO UKRAINE TO FINANCE TWO NUCLEAR REACTORS
The European Bank of Reconstruction and Development is considering giving nearly $200 million to Ukraine to finance the completion of two nuclear reactors at the Rivne and Khmelnytskyy nuclear power plants, Interfax reported on 27 July. The EBRD'S statement that was issued after the bank's 26 July talks with Ukrainian Premier Viktor Yushchenko says the credit is conditional on the closure of the Chornobyl plant and reform in Ukraine's energy sector, including the privatization of energy supplying companies. JM
ESTONIAN, LATVIAN MINISTERS MEET OVER ENERGY COOPERATION...
Estonian Economics Minister Mihkel Parnoja hosted his Latvian counterpart, Aigars Kalvitis, in Tallinn on 26 July to discuss cooperating in the energy sphere. The two ministers discussed the proposed cooperation between the power utilities Eesti Energia and Latvenergo; a working group of the two companies recommended a merger last month, ETA reported. Kalvitis said that the deal to sell Estonia's main power plants to the U.S. company NRG Energy would compromise the proposed merger. Parnoja said, however, that the ball was in the court of the Latvians, pointing to the results of the public petition campaign over the planned privatization of Latvenergo. MH
...AS LATVIAN EMERGENCY PARLIAMENT SESSION CALLED OVER PETITION DRIVE
The Presidium of the Latvian parliament has called for an extraordinary session of the legislature for 3 August to examine the privatization of power utility Latvenergo. That move comes after a petition drive against the utility's privatization was supported by twice the number of signatures needed for a referendum on the issue (see "RFE/RL Newsline," 25 July 2000). A referendum will be called if the parliament amends or defeats a bill ending the restructuring and privatization of the power utility; Janis Naglis, the director of the Latvian Privatization Agency, said the draft law is likely to be defeated, BNS reported. The ruling coalition is reportedly meeting to discuss an alternative version of the bill under which Latvenergo would be subject only to restructuring. MH
VERHEUGEN REAFFIRMS SUPPORT FOR LITHUANIA
Lithuanian Prime Minister Andrius Kubilius met with European Commissioner for Enlargement Guenter Verheugen in Bayreuth, Germany on 26 July to discuss Lithuania's EU integration. ELTA reported that Verheugen praised Lithuania's preparations for EU integration and reaffirmed support for enlargement, which he said "meets the interests of all Europe." Kubilius also met with Edmund Stoiber, the prime minister of Bavaria. MH
WAS WALESA A COMMUNIST SECRET SERVICE AGENT?
Former Solidarity leader Lech Walesa, who is running in this year's presidential ballot, appeared before the Lustration Court on 26 July to confirm his lustration statement, in which he declared that he did not collaborate with the communist-era secret service. Poland's current secret service, the State Protection Office (UOP), has supplied communist-era documents saying that in 1970 Walesa signed a document pledging to collaborate with the security service and received remuneration for his services from 1970-1972, Polish media reported. Walesa testified that in 1970 he signed a document promising only he would keep silent about what was discussed when he was interrogated. He denied that he was an agent. Next week the court will hear the testimony of former Interior Minister Antoni Maciarewicz and former UOP chief Piotr Naimski, who placed Walesa on their 1992 list of communist-era secret agents. JM
POLISH PARLIAMENT APPROVES ADDITIONAL ALLOWANCE FOR POOREST FAMILIES
The Sejm on 26 July approved a proposal that only those families with three or more children that already receive regular family allowances will be eligible to receive a one-time additional allowance, PAP reported. The lawmakers rejected a government proposal to grant such allowances to all families with three or more children, irrespective of the size of their incomes. The payment of the 160 zlotys ($37.2) for the third and each subsequent child is to take place in September. The government has earmarked 200 million zlotys for this purpose. JM
BRITISH FOREIGN SECRETARY IN PRAGUE
On a one-day visit to Prague on 26 July, Robin Cook met with his Czech counterpart, Jan Kavan, as well as with President Vaclav Havel and Premier Milos Zeman, AP and CTK reported. Cook and Kavan later presented to journalists a joint "Action Plan" designed to strengthen bilateral ties and boost Czech efforts to bring the country's legislation into line with that of the EU. Cook repeated a statement that he made in Budapest one day earlier that the EU must set target dates as quickly as possible for its eastward expansion. He said such target dates would serve as motivation for both candidate countries and EU internal reforms. "Deadlines concentrate minds," he commented, but also said he "is not sure" that the EU summit in Nice in December will in fact set any deadlines. MS
CZECH GOVERNMENT TO OPPOSE TEMELIN REFERENDUM BILL
The government on 26 July announced it will oppose in the parliament a bill on a referendum over the Temelin nuclear power plant, CTK reported, quoting government spokesman Libor Roucek. The bill, which was proposed by deputies Libor Ambrozek (Christian Democratic Party), Petra Buzkova (Social Democratic Party), and Vladimir Mlynar (Freedom Union), sets the referendum for May 2001. The cabinet said it would be difficult to agree to a referendum on a nuclear plant that is "ready to be put into service." It also said it opposes a bill that deals with a referendum on a specific issue and that a bill on plebiscites in general must first be adopted by the parliament. The organizers of the petition Referendum 2000, who gathered more than 115,000 signatures for a referendum, said the cabinet is breaking a promise made during its election campaign. MS
CABIN WITH FASCIST SYMBOLS DISCOVERED IN CZECH FOREST
A forest ranger has discovered a wooden cabin daubed with swastikas and other fascist inscriptions near the village of Nadlesi, in the Chomutov region of northern Bohemia, CTK and AP reported on 26 July. The cabin was reportedly the meeting place for a group of young men. Police are investigating who drew the swastikas inside the cabin. Also on 26 July, a spokeswoman for the International Romany Union, which is holding its Fifth World Congress in Prague at RFE/RL headquarters, said the congress is demanding that Germany apologize for the treatment of Roma during the Holocaust, set up a compensation fund for those who survived, and finance a monument in the memory of those who died. MS
CSURKA SLAMS SOCIALISTS ON HUNGARIAN ROMA CASE...
Istvan Csurka, the chairman of the extreme right Hungarian Justice and Life Party, said on 26 July that "now, when the entire EU accession process is in crisis because of the caution of EU countries, some Socialist politicians are presenting the unfortunate case of [the Roma group from] Zamoly as if its assessment could prevent Hungary's admission to the EU" (see "RFE/RL Newsline," 25 July 2000). "This is slander and a lie," Csurka said. Aladar Horvath, chairman of the Roma Civil Rights Foundation, said that Csurka's statement can only help Roma to receive political asylum in other countries. MSZ
...WHILE ROMA GROUP ACCUSES HUNGARIAN CABINET IN STRASBOURG
The group of Roma from Zamoly seeking political asylum in France has filed a complaint against Hungary's government to the European Court of Human Rights, saying they were persecuted for three years and demanding 130 million forints ($470,000) in compensation. According to Hungarian media, the group's spokesman, Jozsef Krasznai, owes 410,000 forints ($1,500) to companies in Hungary, and his house will be auctioned off next month. MSZ
SLOVENIA TO VOTE ON 15 OCTOBER...
President Milan Kucan said in Ljubljana on 27 July that he has called parliamentary elections for 15 October following consultations with various party leaders, Reuters reported. Kucan has long argued that the elections should be held as early as possible in order to end instability. He is also concerned lest time be lost for drafting and passing legislation in preparation for joining the EU, which enjoys broad public support. PM
...AMID CHANGING POLITICAL LANDSCAPE
Prime Minister Andrej Bajuk will set up his own political party to contest the elections, "Delo" reported on 27 July. His break with his SLS/SKD Christian Democratic party came after that party voted with the center-left opposition to keep a proportional voting system for the fall election (see "RFE/RL Newsline," 26 July 2000). Foreign Minister Lojze Peterle, who also belongs to the SLS/SKD, said in Ljubljana that he will probably join Bajuk's party, AP reported on 26 July. The opposition center-left parties include people from the former communist nomenklatura, who dominated the government from independence in 1991 until the spring of 2000 (see "RFE/RL Balkan Report," 30 May 2000). The center-right government is led primarily by people with family roots in the anti- communist Domobrani (Home Guards) of World War II, including Bajuk, Peterle, and conservative Social Democratic leader Janez Jansa. PM
MACEDONIAN ALBANIAN UNIVERSITY LEGALIZED
The parliament voted on 26 July to approve an OSCE-sponsored measure to legalize the underground Albanian-language Tetovo university as an accredited private institution (see "RFE/RL Balkan Report," 28 April 2000). The debate leading up to the vote included acrimonious exchanges between members of the government ethnic Albanian party, which supports the bill, and opposition Albanians, who want the Tetovo university to be a state institution on a par with the Macedonian-language one in Skopje, the private MIC news agency reported. After the vote, the Macedonian Academy of Sciences said in a statement that legalizing the Tetovo university is "one more step toward the partition" of Macedonia along ethnic lines, the BBC's Serbian Service reported. The Tetovo university question is one of the most divisive in Macedonian politics. The OSCE-sponsored measure envisions the university as an institution for training teachers and civil servants, who will have to demonstrate proficiency in Macedonian as well as in Albanian. PM
MILOSEVIC CALLS ELECTIONS FOR SEPTEMBER
Yugoslav President Slobodan Milosevic announced in Belgrade on 27 July that federal parliamentary elections will be held on 24 September (see "RFE/RL Newsline," 26 July 2000). Serbian municipal and local elections will also take place that same day, Reuters reported. The Montenegrin authorities have repeatedly said that they will boycott any federal elections held under Milosevic's new electoral legislation. The Serbian opposition is divided as to whether to participate in the federal and local vote. PM
SERBIAN COURT SENTENCES FILIPOVIC TO SEVEN YEARS
A military court in Nis sentenced Miroslav Filipovic on 26 July to seven years in prison for writing about atrocities committed by Serbian forces in Kosova in 1999 (see "RFE/RL Newsline," 26 July 2000). His attorneys will contest the ruling, "Blic" reported. In New York, Amnesty International said in a statement that the authorities should investigate the veracity of Filipovic's reports rather than put him in jail for writing them. In Washington, State Department spokesman Philip Reeker said that the court ruling "is, of course, in keeping with the [Slobodan] Milosevic regime's typical attitude to try to muzzle Serbia's independent media by seizing or shutting down facilities, by expelling foreign journalists, and threatening or even beating those brave enough to report the truth amongst their own journalist corps," AP reported. PM
ROBERTSON WARNS MILOSEVIC ON KOSOVA, MONTENEGRO
Speaking in Brussels on 27 July, NATO Secretary-General Lord Robertson praised the recent anti-violence agreement between several leading Serbian and Albanian political personalities from Kosova (see "RFE/RL Newsline," 25 July 2000). He added: "We will not allow Milosevic or any of the ethnic groups within Kosovo to plunge the region back into the horrific violence it suffered a year and a half ago," Reuters reported. Referring to Montenegro, Robertson said: "I say to Milosevic: watch out, look what happened the last time you miscalculated.... The international community will not appreciate it if Milosevic does something whose effect would be to remove a man elected by the Montenegrin people," namely President Milo Djukanovic. Asked whether such action would lead NATO to intervene, Robertson added: "We aren't saying what we will do. One of the lessons of Kosovo is that you don't reveal your cards too far in advance." PM
EU EXPANDS 'WHITE LIST' FOR SERBIAN BUSINESSES
A spokesman for the EU's executive commission said in Brussels on 26 July that the EU has identified an additional 52 Serbian companies that it would like to add to its "white list" of Serbian firms exempt from sanctions. The EU will not announce their names until its representatives have spoken with those of the companies, Reuters reported. Such firms have been dubbed traitors by the Milosevic regime (see "RFE/RL Newsline," 25 July 2000). PM
HAGUE COURT INVESTIGATING MILOSEVIC'S FINANCES ON CYPRUS
Cypriot authorities have confirmed recent international press reports that the Hague-based war crimes tribunal is investigating Milosevic's business ties and financial activities on that island, RFE/RL's South Slavic Service reported on 26 July. PM
EU AUTHORIZES FUNDS FOR CLEARING DANUBE RIVER
The European Commission on 26 July authorized the release of up to $20.5 million to cover part of the cost of clearing the River Danube of debris from bridges destroyed by the NATO bombing of Yugoslavia last year, AP reported. The money will be transferred to the Danube Commission, an international organization responsible for navigation on the river. MS
ROMANIAN PREMIER HINTING HE WON'T RUN FOR PRESIDENT?
Mugur Isarescu might delay until 15 August announcing whether he will run for president, Mediafax reported on 26 July, citing "sources close to the premier." Those sources said Isarescu, who has been urged to run by the National Peasant Party Christian Democratic (PNTCD) and the Union of Democratic Forces, is "not very enchanted" by the current political campaign involving his name and that he fears the campaign might undermine the cabinet's efficiency. The sources also said that so far Isarescu's reply to those who have urged him to run has been that "his only objective in 2000 is to organize correct elections, pursue negotiations for Romania's joining the EU, and renew economic growth." Meanwhile, the PNTCD leadership on 26 July decided against postponing parliamentary elections and in favor of holding them at the same time as the presidential ballot, RFE/RL's Bucharest bureau reported. MS
ROMANIAN NATIONALIST PARTIES TO MERGE
Party of Romanian National Unity (PUNR) Deputy Chairman Ioan Gavra announced on 26 July that the negotiations with the Romanian National Party (PNR) have ended with an agreement to merge the two formations. Gavra said there is a need to "unite all rational national forces" and that the agreement on the merger will be signed by 1 August and submitted for approval to their respective National Councils by 15 August. The PNR is headed by former Intelligence Service chief Virgil Magureanu. Both parties fared poorly in the June local elections. MS
PRIMAKOV SAYS OSCE, RUSSIAN POSITIONS ON TRANSDNIESTER 'COINCIDE'
Yevgenii Primakov, chairman of the special state commission on the settlement of the Transdniester conflict, said in Vienna on 26 July after meeting with current OSCE Chairwoman Benita Ferrero-Waldner that the Russian and the OSCE positions on that conflict "coincide," ITAR-TASS reported. Ferrero-Waldner the same day received a letter from separatist leader Igor Smirnov criticizing the organization and its chairwoman in particular, Infotag reported. "The unwillingness of the OSCE Council to allow the Transdniester delegation to address the recent OSCE meeting in Vienna has compromised both your personal authority and the authority of your organization," Smirnov wrote. Speaking on Transdniester Television one day earlier, Supreme Soviet chairman Grigorii Marakutsa had said that negotiations over the status of the region "cannot continue for ever" and the Transdniester will now "concentrate its efforts on creating a sovereign and independent state," AP reported.
U.S. AGENCY, SOROS TO SET UP PRIVATE EAST EUROPEAN BUSINESS FUND
The U.S. governmental Oversees Private Investment Corporation (OPIC) and billionaire financier George Soros announced on 26 July they will establish a $150 million fund to spur private business in southeastern Europe, AP reported. Soros will contribute $50 million to the fund and the remainder will be provided by the OPIC. OPIC chairman George Munoz said the fund will encourage private ventures in Albania, Bosnia, Bulgaria, Croatia, Macedonia, Montenegro, Romania, Slovenia, and Turkey. Munoz said Kosova is not included because it lacks the necessary governmental structure, while Serbia "has excluded itself." MS
FEDERATION COUNCIL APPROVES PUTIN-LED REFORMS
by Sophie Lambroschini
By approving a law removing them from the parliament and by adopting a new tax code, Russia's regional governors have submitted to the inevitable. In so doing, they relinquished the idea of a last stand in a protracted conflict with the Kremlin over President Vladimir Putin's large-scale centralization plan.
The law on the upper house was adopted on 26 July after little more than an hour's debate. The Federation Council was slightly more resistant when it came to the discussion of the tax code, which lasted into the afternoon. The tax reform that was finally adopted could undermine the governors' economic power by reducing their financial resources. Tax and revenue distribution was always at the heart of their tug-of- war with the federal authorities.
The bill overhauling the Federation Council passed by a vote of 119 to 18 with four abstentions and 35 members absent. Russia's 88 governors and presidents (excluding Chechnya), as well as 88 regional assembly heads, agreed to give up their seats in the upper house, an important political platform with the power of approving presidential decrees, including sending Russian troops abroad. After a gradual rotation to be completed by 2002, they will be replaced by representatives appointed by regional officials. The bill was the result of a compromise with the State Duma (lower house) over a harsher proposal made by Putin two months ago. Federation Council speaker Yegor Stroev, who met with the president the day before the vote, made clear that any further fight was useless. He said: "We all know the bill will be passed."
That was an apparent reference to a constitutional provision allowing a bill to be passed if the Duma overrides a Federation Council veto by more than 300 votes. So far, all three laws implementing Putin's vast centralization plans have been adopted by the Duma with more than 300 votes.
Chuvash President Nikolai Fedorov, a strong opponent of the reform, argues that the changes only strengthen the president's powers at the expense of the parliament and the regions. But even Fedorov says the governors cannot resist a movement that is approved by Russian society, which he comments is longing for a strong hand. "I must conclude, unfortunately, that we all aimed for and tried to build a state with the rule of law," he said, "But it turns out now that society--or at least the prevailing atmosphere--is such that the will of the emperor, the will of the president, is law."
Putin argues his reforms are aimed at strengthening the rule of law and preventing regional separatism. He says the changes will put an end to local fiefdoms in which governors have passed unconstitutional laws and substituted domestic for federal powers such as the police and the courts.
But many governors argue that they helped save Russia from disintegrating into civil war by intervening when the federal government did not do its job. They cite their actions after the August 1998 financial crisis, when some governors imposed illegal price controls over basic products and limited exports out of their regions as a way to lessen the blow of a tumbling ruble.
Most analysts say the real issue is regional economic power, which the Kremlin-proposed tax reform adopted by the Federation Council reduces by centralizing taxes. Both bills approved on 26 July are part of a larger tax reform that introduces measures such as the world's lowest income tax, a flat 13 percent rate.
The new tax legislation, which cuts into the regions' tax allowance, has already been adopted by the Duma. It reduces that part of tax revenues that the regions may keep for themselves. For example, the regions now receive 15 percent of the collected value-added tax. The new bill transfers total control of VAT over to the federal government. Another measure, hailed by businesses but criticized by the regions, is the planned elimination of a 4 percent turnover tax that was mostly spent in the regions.
Russia's 19 "donor" regions--those that give more to the federal budget than they receive--are especially critical of the reform. These relatively affluent areas, which include Moscow and oil-producing regions, feel that under the principle of tax redistribution, they will unfairly share their economic wealth with poorer areas. But many poorer regions feel they can only win from a reform that could increase tax distribution in their favor. The author is an RFE/RL correspondent based in Moscow.