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Caucasus Report: February 25, 2000

25 February 2000, Volume 3, Number 8

Can Armenia's New Government Bring Stability? Just over 100 days after succeeding his murdered brother Vazgen as Armenian premier, Aram Sargsian has streamlined his cabinet, bringing in representatives of two more of the six opposition parties represented in parliament -- the Communists and the National Democratic Union. But those who hope the agreement reached on 20 February by Sargsian and the eight parliamentary parties to work together to bring Armenia out of its present socio-economic crisis will finally put an end to tensions between President Robert Kocharian and Sargsian and his government supporters may be disappointed.

Those parliamentary parties excluded from the new government, whether because they rejected the posts Sargsian offered or because no such offer was made, will be set to criticize, and to capitalize on, the new cabinet's errors and shortcomings. So, too, will the biggest loser in last year's parliamentary elections, the Armenian Pan-National Movement, which still cannot reconcile itself to its total loss of influence. Artur Baghdasarian, chairman of the Orinats Yerkir party that is not represented in the new cabinet and one of the signatories of the 20 February statement, warned that his party would bear no responsibility for the actions of the new cabinet.

Several commentators have queried whether the new heterogeneous cabinet will be able to function as an effective and cohesive team. For example, "Hayots ashkhar," which is close to the Armenian Revolutionary Federation--Dashnaktsutiun that is sympathetic to President Robert Kocharian, on 24 February asked "what our Communists, Socialists, nationalists and liberals" have in common." The same paper predicted that, with virtually all parliament factions to be in some way represented in the executive, the opposition will move "inside the government." "The pro-Russian defense ministry will be at odds with the pro-Western foreign minister, and the socialist ministry of agriculture will oppose the liberal ministry of finance and economy," the paper concluded.

Other observers have questioned the rationale for Sargsian's offer to form a coalition government, and for opposition parties' acceptance of that offer. Those observers suggest that the motivation may have been not so much willingness to accept part of the responsibility for creating and implementing government policy, rather than the dilution of that responsibility, or what one paper termed "collective irresponsibility." Deputy parliament speaker and Republican Party deputy chairman Tigran Torosian on 24 February denied that the majority Miasnutiun parliament bloc, of which his party is the senior partner, is seeking to off load responsibility for the economic situation.

Also unclear is how the cabinet reshuffle will impact on Kocharian. Contrary to rumors circulating in Yerevan earlier this week, one of Kocharian's closest allies, Foreign Minister Vartan Oskanian, did not lose his post. But a second Kocharian supporter, Justice Minister David Harutiunian, has been replaced by Armen Harutiunian (no relation), a member of the Republican Party of Armenia and the senior partner in the Miasnutiun parliament bloc. Miasnutiun members have repeatedly denied that Sargsian's initiative was in any way aimed against Kocharian.

Finally, Sargsian's proposal has apparently given rise to tensions within the National Democratic Union. Several of the party's leading members apparently jumped at the chance to acquire ministerial posts, but its chairman, Vazgen Manukian, abstained from the board's vote on whether to accept Sargsian's offer, "Haykakan zhamanak" reported on 23 February. (Liz Fuller)

An Insider's View Of The Chechen Leadership. Last October Chechen historian Mairbek Vachagaev, who had recently stepped down as President Aslan Maskhadov's press secretary and moved to Moscow as Chechnya's official representative in the Russian capital, was arrested and charged with illegal possession of a firearm. Since then, Vachagaev has been held in solitary confinement while the Russian courts try to figure out how to prove his guilt, given that the weapon in question does not bear his fingerprints.

On 19 February, "Nezavisimaya gazeta" published written responses that Vachagaev provided to questions the paper had submitted after repeatedly being denied permission to conduct a face-to-face interview with him. Vachagaev characterized his arrest as "a strictly political act [directed] against Maskhadov� and one that fits into the broader context of what he terms "the increasingly prevalent anti-Chechen Russian state ideology" which depicts Chechens as traveling round Moscow carrying grenade-launchers, with pistols and grenades an essential component of national costume.

Although Vachagaev does not make a direct connection, such a portrayal of an entire ethnic group in such negative terms underscores that, in his words, "today the Russian leadership manifests its own impotence and the absence of any policy with regard to Chechnya. The same principles are being used as in 1994-1996: trying to intimidate the Chechens by numerous filtration camps, buying a couple of dozen puppets who will talk about eternal and indestructible friendship with Russia..." The only thing Moscow has done right, Vachagev comments, is "at long last to get rid of the, forgive the expression, most incompetent Minister for Nationality Affairs [Vyacheslav] Mikhailov [a former deputy department head in the CPSU Central Committee Department for National Relations-- LF], who together with [Ramazan] Abdulatipov [Mikhailov's predecessor as minister --LF] contributed a great deal to the collapse of the Russian Federation." It is high time, Vachagaev said, to set about determining "which country's interests those two represent."

On the subject of Chechen domestic politics, Vachagaev admits that political disagreements existed within the Chechen leadership over the optimum approach to building an independent Chechen state. But despite those disagreements, he said, almost all resources were channeled into the "force" structures in an attempt to stamp out abductions for ransom and the theft of oil products. Vachagaev singles out as one of the most egregious mistakes committed by the Chechen leadership adopting a cadre policy of which the fundamental criterion was whether or not a given individual had fought in the 1994-1996 war. The consequence of that policy, Vachagaev notes, result, was that qualified specialists found themselves unemployed, while crooks and other dubious characters engaged in a struggle for positions of influence. As a result, Maskhadov wasted much of his time struggling to resolve local problems and quarrels.

But Maskhadov's most crucial error of judgment, according to Vachagaev, was that despite repeated warnings from Vachagaev himself, "until October last year he did not believe a new outbreak of fighting was possible.... Until the last minute, he thought Russia was simply flexing its muscles and would not go any further than [issuing] ultimatums." Vachagaev commented that all Maskhadov's efforts to establish contact with Russia's leaders were interpreted by the latter as a sign of weakness, and that no one in Moscow believed that he sincerely wanted to avoid a new war.

Asked whether he believes it is possible to mediate a peaceful solution to the conflict, Vachagaev said that all wars eventually come to an end, but that in order to prevent a resumption of hostilities it is essential to reach agreement with those against whom the war was waged. Attempts to negotiate a settlement with a third party are self-deception, he added in a clear allusion to suggestions that pro-Moscow Chechens such as Mufti Akhmed-Hadji Kadyrov could be an alternative negotiating partner to Maskhadov.

Vachagaev went on to differentiate clearly between the readiness of the Chechen population of the Russian-controlled areas of Chechnya to accept food parcels and energy supplies from the Russian government and their simultaneous rejection of the new Russian-imposed administrative system. For that reason, Vachagaev argued, "the conflict can be resolved only within the framework of negotiations with Maskhadov.... Maskhadov is the president of the Chechen Republic Ichkeria, and there are no others." Putin has a real chance to resolve the issue of Chechen-Russian relations once for all time, Vachagaev said, all that is needed is a sincere desire to do so.

Vachagaev also provided a valuable insight into the tense and fateful relations between Maskhadov and field commander Shamil Basaev. He confirmed that Basaev's incursion into Daghestan in August 1999 was "a long-awaited gift to the Russian hawks." Asked why Maskhadov did not take action to prevent that attack on Daghestan, Vachagaev explained that at that juncture relations between Maskhadov and Basaev had already reached breaking point. But Basaev's forces were not strong enough for him to move against Maskhadov. The president, for his part, despite pressure from his entourage, was reluctant to move against Basaev lest Moscow seize upon the ensuing inner-Chechen conflict as a pretext for violating the May 1997 peace agreement signed by Maskhadov and then Russian President Boris Yeltsin.

But Vachagaev nonetheless insists that Basaev's attack on Daghestan was only one of the reasons for the new war, the primary cause being "the failure to define [the nature of] relations between the ChRI and the RF, or rather the absence on Russia's part of any desire to resolve this problem in a civilized way." (Liz Fuller)

Georgian Opposition Coalition Names two Presidential Candidates. Despite his threats to boycott the 9 April Georgian presidential election if parliament failed to enact amendments to the election law, Adjar Supreme Council chairman Aslan Abashidze told the Georgian Central Electoral Commission that he would participate in the poll shortly before the deadline for registration expired on 19 February. Abashidze is the second presidential candidate to be nominated by the five-party Batumi Alliance, the other being former Georgian CP First Secretary Djumber Patiashvili.

The presumed rationale for nominating two candidates is to spread among the maximum number of alternative candidates a possible protest vote against incumbent Eduard Shevardnadze in the hope of depriving the latter of the 50 percent plus one vote needed for a first round victory. It is questionable, however, whether Patiashvili and Abashidze -- the front runners among the 13 rival candidates -- will succeed in forcing a runoff, even if, as has been suggested, supporters of Joseph Stalin's grandson Evgenii Djughashvili, who has been barred from contesting the poll on the grounds that he is a citizen of Russia, not of Georgia, can be persuaded to vote for Patiashvili instead. (Liz Fuller)

Georgia's Budget Woes. On 22 February, the Georgian parliament finally approved in the first reading the draft budget for this year, which envisages revenues of 883 million lari ($420 million) and expenditures of 1.255 billion lari, resulting in a deficit of 381 million lari. Under an agreement reached last month between the Georgian government and the IMF, annual inflation should not exceed 7 percent.

The projected targets for income and expenditure are predicated on an exchange rate of 2.1-2.2 lari to the US dollar. Planned revenues are 15 percent higher, and expenditures 20 percent greater than those envisaged in the first draft of the budget sent to parliament in December. (That draft was abandoned as it made no provision for the repayment of two foreign loans of almost $1 million.)

According to Minister of State Vazha Lortkipanidze, the planned expenditures include 110 million lari to pay off pension and wage arrears, (the IMF had proposed that income from privatization of state enterprises, anticipated at 170 million lari, should be earmarked for that purpose) and 173 million lari towards paying off Georgia's foreign debt, which totals $2.39 billion. The planned revenues target for 2000 seems optimistic, given that revenues in 1999 totaled only 631.5 million lari, compared with the target figure of 942.45 million.

But representatives of the Union of Citizens of Georgia (SMK), the majority parliament faction, and of the opposition Union for Revival and Union of Manufacturers, who voted against the draft, are unanimous in considering the proposed expenditures inadequate. SMK parliament faction leader Mikhail Saakashvili admitted that "we had to pass a budget that envisages insufficient funding for priority reforms, and will have difficulty implementing those reforms this year." Revaz Adamia, the hawkish chairman of the parliament Defense and Security Committee, complained that the 10 million lari allocated for the protection of Georgia's state borders is totally inadequate.

Representatives of Georgia's regions, too, are unhappy that the draft budget slashes the amount of VAT they collect which they are allowed to retain. The Tbilisi municipal council has already appealed directly to President Eduard Shevardnadze for an additional 17 million lari to compensate for the anticipated shortfall.

It is, however, highly unlikely that such funds will be forthcoming. As in 1998 and 1999, fulfillment of this year's budget will be largely contingent on foreign loans, whether from the U.S., the World Bank or the IMF, or all three. (The IMF has reportedly postponed a decision on any new loans until after the 9 April presidential election.) Already last October, AFP quoted the IMF resident representative in Tbilisi as expressing concern at Georgia's inability to fund social spending and characterizing the government's budget policy as not sustainable in the long term. A second Western analyst described the budget crisis as "the mother of all the evils" currently besetting the Georgian economy. (Liz Fuller)

Quotations Of The Week. "I think what Russia is doing in Chechnya is wrong but we could not do otherwise...There are times when you have to withstand just criticism in order to save your country...Either we suppress the insurrection and the international terrorism [in Chechnya], or all the structures [in Russia] fall apart." -- Council of Foreign and Defense Policy presidium chairman Sergei Karaganov, speaking in Copenhagen on 18 February, quoted by Reuters.

"I can't understand why [some supporters of Armenian Premier Aram Sargsian] want the president to quit." -- French Ambassador to Yerevan Michel Legras, speaking to RFE/RL on 22 February.

"The peaceful settlement in the South Caucasus should proceed simultaneously with the normalization of the situation in the Balkans." -- Azerbaijani Foreign Minister Vilayat Guliev, quoted by Caucasus Press, 22 February.

"I think the question of the Baku-Ceyhan pipeline...has been overpoliticized.... You could get the impression that what is to be built is not a purely civilian structure but something that constitutes the dividing line between good and evil." -- Kazakhstan's President Nursultan Nazarbaev, interviewed in "Nezavisimaya gazeta" on 24 February.