RFE/RL NEWSLINE Vol. 3, No. 171, Part I, 2 September 1999

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RFE/RL NEWSLINE Vol. 3, No. 171, Part I, 2 September 1999

A daily report of developments in Eastern and Southeastern
Europe, Russia, the Caucasus and Central Asia prepared by the
staff of Radio Free Europe/Radio Liberty.

This is Part I, a compilation of news concerning Russia,
Transcaucasia and Central Asia. Part II covers Central,
Eastern, and Southeastern Europe and is distributed
simultaneously as a second document.  Back issues of
RFE/RL NewsLine and the OMRI Daily Digest are online at
RFE/RL's Web site: http://www.rferl.org/newsline

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Headlines, Part I

* IVANOV SAYS MOSCOW WON'T TOLERATE WEST'S 'CASTING SHADOW' ON
RUSSIA...

* ...WARNS RUSSIA WILL PROTECT ITS INTERESTS IN CAUCASUS

* AZERBAIJAN'S PRESIDENT BLASTS OSCE FOR INACTIVITY
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RUSSIA

IVANOV SAYS MOSCOW WON'T TOLERATE WEST'S 'CASTING SHADOW' ON
RUSSIA. Speaking to students at the Moscow State Institute of
International Relations on 1 September, Foreign Minister Igor
Ivanov said the Russian government will not accept "the use of
unverified facts to cast a shadow on our country," Interfax
reported. While acknowledging that corruption remains a
problem in Russia, Ivanov said the current manner of
addressing it in "some Western mass media is not about
fighting corruption but rather targeted politics." He said
that the entire scandal about "Russian money laundering" had
been developed by "certain circles that do not want Russia to
reclaim its role as a great power in the international arena."
PG

SCANDAL COVERAGE DOMINATES MOSCOW PRESS. Russian newspapers
continued to focus on the money-laundering scandal. "Segodnya"
said "Russia has no place to retreat to in the bank scandal--
next are economic sanctions." It quoted Our Home Is Russia
faction leader Vladimir Ryzhkov as saying that "Russia
shouldn't pretend that it doesn't notice anything" and that
Moscow should investigate the charges fully Meanwhile,
"Nezavisimaya gazeta" said that "the investigation of the
Russian financial scandal has already had one result--a blow
to the reputation of all domestic banks and companies." PG

RUBLE FALLS OWING TO U.S. PLAN TO PROBE IMF LOANS. The ruble
fell sharply against the dollar on 1 September following a
statement by U.S. Treasury Secretary Lawrence Summers that
Washington will not support the extension of any new IMF
credits to Russia until there has been an examination of what
happened to earlier monies sent to Moscow, Interfax reported.
Aleksandr Livshits, Moscow's special envoy to international
financial institutions, said he is bewildered by Summers's
statement: "I am not sure at the moment what Summers wants to
check," he told Interfax. And First Deputy Finance Minister
Oleg Vyugin said on 1 September that he believes Summers's
statement reflects political pressures in the U.S. PG

FOREIGN MINISTRY ACCUSES U.S. OF KOSOVA COVER-UP. In a
statement released on 1 September, the Russian Foreign
Ministry accused U.S. forces of engaging in a month-long
cover-up of the murder of 15 ethnic Serbs there, ITAR-TASS
reported. The statement said that "we are speaking about an
odious occurrence" involving the concealment of a crime
committed in the village of Ugljar, which is within the U.S.
zone of responsibility. The statement said Moscow believes
that "this cover-up must be a subject of detailed discussion
at the upcoming UN Security Council meeting." But the Russian
news agency said there has been no progress in resolving the
stand-off between Russian troops and ethnic Albanians in
Rahovec. PG

YELTSIN OUTRAGED BY MANEZH EXPLOSION. Presidential spokesman
Dmitrii Yakushkin told Interfax on 31 August that Boris
Yeltsin is outraged by what he called the barbaric terrorist
act at Moscow's Manezh square Shopping mall. Mayor Yurii
Luzhkov was equally angry: he called the still-unidentified
attackers "beasts" and said that "these people need to be
shot," ITAR-TASS reported on 1 September. The authorities
reported finding materials linking the bombing to an anti-
consumer goods group called the Union of Revolutionary
Writers, about which no one has heard until now. But various
officials suggested that those responsible might range from
the Chechens to economic or political groups in the Russian
capital. In Grozny, Chechen Deputy Prime Minister Kazbek
Makhashev denied any Chechen involvement in the bombing,
Interfax reported. PG/LF

AIR FORCE SETS UP SPECIAL UNITS POR NORTH CAUCASUS FIGHTING.
The Russian air force has established several experimental
units as part of its effort to combat guerrillas in the North
Caucasus, ITAR-TASS reported on 1 September, citing a source
in the defense industry. These groups will include specially
outfitted Mi-24 gunships and Mi-8 cargo helicopters. PG

IVANOV WARNS RUSSIA WILL PROTECT ITS INTERESTS IN CAUCASUS...
Foreign Minister Ivanov told journalists in Moscow on 1
September that "Russia has been and will be a power in the
Caucasus" and that conflicts in the region will not be
resolved without Russian input or to the detriment of Russian
interests, Interfax reported. He said it is in Russia' s
interest to develop comprehensive, balanced and mutually
beneficial relations with Armenia, Azerbaijan, and Georgia.
He added that Moscow expects those countries to cooperate in
helping to fight terrorism in Daghestan, which, he said,
poses a threat to the Transcaucasus as well as Russia.
Sergeev said Russian will continue playing an effective
peacekeeping role in Georgia, and he welcomed the dialogue
between the presidents of Armenia and Azerbaijan. But he also
warned that Russia "will draw the appropriate conclusions" if
the GUUAM alignment, of which both Georgia and Azerbaijan are
members, "becomes explicitly military by nature." Ivanov
departs on 2 September for a tour of all three South Caucasus
states, but he admitted that he does not anticipate "any
breakthroughs" during his talks there. LF

...SLAMS BAKU-CEYHAN, TRANS-CASPIAN PIPELINES. Also on 1
September, Ivanov questioned the economic viability of the
oil export pipeline from Baku to Ceyhan and that of the
planned Trans-Caspian gas pipeline, arguing that if those
projects were indeed viable, work on their implementation
would have begun long ago. Ivanov said that no pipeline
routes are a priori unacceptable to Moscow, but they become
so if political, rather than economic, considerations prevail
to Russia's disadvantage, according to Interfax. Ivanov added
that the presence of military bases in Georgia is in the
interests of that country. LF

RUSSIAN FORCES TAKE KARAMAKHI. Russian and Daghestani
Interior Ministry forces took control of the village of
Karamakhi in Daghestan's Buinaksk Raion late on 1 September
after hours of heavy fighting, Russian agencies reported. The
following day, they also took the village of Chabanmakhi,
Caucasus Press reported, quoting Russian Deputy Interior
Minister Vladimir Kolesnikov. In Moscow, Interior Minister
Vladimir Rushailo said operations are continuing in the
district of Kadar. He predicted that the "second stage" of
the Russian military operation in Daghestan will be completed
"in the next few days." LF

STALIN ELECTORAL BLOC APPLIES FOR REGISTRATION. The Central
Election Commission on 1 September announced that it will
review the registration application submitted by the electoral
Stalin Bloc: Workers' Russia, ITAR-TASS reported. The new bloc
is lead by Trudovaya Rossiya's Viktor Anpilov, the Union of
Officers' Stanislav Terekhov, and the grandson of Joseph
Stalin, Yevgenii Dzhugashvili. PG

INDUSTRIAL OUTPUT, INFLATION RISE. The Ministry of Economics
said industrial output in Russia grew by nearly 5.3 percent in
the period from July to August 1999, compared with the same
period in 1998, Interfax reported on 1 September. The ministry
predicted that the 1999 annual inflation rate will be 45
percent, with real incomes falling 15-18 percent over that
period. PG

TAX POLICE OPEN CASES AGAINST THREE OIL COMPANIES. The Russian
Federal Tax Police has opened criminal cases for tax evasion
against Rosneft, Sidanko, and an unnamed third oil company,
Interfax reported on 1 September. The police said the amounts
of money involved are substantial. PG

GOVERNMENT TO SEEK DUMA RATIFICATION OF START-2. Russian
Foreign Minister Ivanov said the Russian government will press
the State Duma to ratify the START-2 arms limitation treaty
when the parliament resumes work later this month, ITAR-TASS
reported. He said that "ratification of the START-2 treaty
meets the interests of strategic stability," and he also
called for proceeding with START-3 talks. PG

MOSCOW PLEDGES NOT TO DUMP RADIOACTIVE WASTE INTO SEA OF
JAPAN. Primore Governor Yevgenii Nazdratenko said in Tokyo on
1 September that Russia will never dump liquid radioactive
waste into the Sea of Japan, ITAR-TASS reported. He then cut
short his visit to the Japanese capital because of the impact
of torrential rains in his home area. PG

RUSSIA SEIZE SIX TRYING TO SELL RADIOACTIVE MATERIALS.
Authorities in Vladivostok arrested six people who sought to
sell 6 kilograms of Uranium 238 and nickel to undercover
officers, AP reported on 1 September. The six had stolen the
material from a plant that repairs and dismantles nuclear
submarines and wanted to sell it for $130,000. PG

MOSCOW TO SELL TWO NUCLEAR SUBS TO CHINA. According to the
"Hong Kong Standard," as reported by dpa on 1 September, China
has reached a tentative agreement with Russia to purchase two
Typhoon-class nuclear submarines. Such ships can carry up to
20 SSN-20 ballistic missiles with a maximum range of 8,300
kilometers. PG

ITAR-TASS TRACES ITS ORIGINS TO NICHOLAS II. ITAR-TASS on 1
September marked what it said was its 95th birthday. According
to a press release, today's ITAR-TASS began as the St.
Petersburg Telegraph Agency with the approval of Tsar Nicholas
II, who wanted the agency "to report within the Empire and
abroad political, financial, economic, trade and other news of
public interest." The St. Petersburg agency was renamed the
Petrograd Telegraph Agency in 1914 and became the Russian
Telegraph Agency (ROSTA) after the Communist revolution. It
was rechristened TASS in 1925 and assumed its current name in
January 1992, after the collapse of the Soviet Union.
According to ITAR-TASS, it is one of four world news agencies.
Its motto is: "Accuracy and Efficiency First!" PG

TRANSCAUCASUS AND CENTRAL ASIA

ARMENIAN FOREIGN MINISTER VISITS JAPAN, SOUTH KOREA. Visiting
Tokyo on 29-31 August at the head of a government delegation,
Vartan Oskanian met with government and banking officials and
the heads of major corporations to discuss establishing a
Japanese-Armenian economic committee and improving bilateral
relations, Noyan Tapan reported. On 31 August, Oskanian and
his Japanese counterpart, Masahiko Komura, signed a joint
communique pledging to boost ties through regular dialogue.
Oskanian thanked Komura for Tokyo's economic assistance to
Armenia and stressed the importance of a balanced approach
toward the three South Caucasus states. He reaffirmed
Armenia's commitment to the peaceful resolution of conflicts
in the South Caucasus. On 1 September, Oskanian met with
South Korean President Kim Dae Jung and with Minister of
Foreign Affairs and Trade Hon Sun-Yeng in Seoul to discuss
international and regional affairs and the prospects for
political and economic cooperation. LF

CONVICTED ARMENIAN NEWSPAPER EDITOR CONSIDERS SERVING PRISON
TERM. Nikol Pashinian, who was sentenced to one year in jail
on 31 August by a Yerevan district court, told a news
conference on 1 September that he may considering going to
jail, rather than appealing that sentence, as a gesture of
protest against the present Armenian leadership, RFE/RL's
Yerevan bureau reported (see "RFE/RL Newsline," 1 September
1999). Pashinian was found guilty of obstructing the police,
of refusing to comply with a court order that he publish a
retraction of materials printed in his newspaper, "Oragir,"
and of two counts of libel. The independent daily "Aravot" on
1 September condemned the sentence as "provincial-style
repression," while National Democratic Union chairman Vazgen
Manukian termed it "intimidation" that could set "a dangerous
precedent." LF

AZERBAIJAN'S PRESIDENT BLASTS OSCE FOR INACTIVITY. Meeting in
Baku on 1 September with Carey Cavanaugh, the new U.S. co-
chairman to the OSCE Minsk Group, Heidar Aliev complained
that the hopes generated by the 1997 appointment of U.S. and
French co-chairmen of the OSCE Minsk Group have not borne
fruit and that the Minsk Group has been "passive" since last
year, Turan reported. Aliev added that the Minsk Group's
proposal that Azerbaijan and the unrecognized Nagorno-
Karabakh Republic form a "common state" is unacceptable to
Baku as it constitutes a "concealed form" of recognition of
the enclave's independence, according to ITAR-TASS. Cavanaugh
had said at a meeting earlier on 1 September with
Azerbaijan's Foreign Minister Tofik Zulfugarov that he
believes the recent meetings in Geneva between Aliev and his
Armenian counterpart, Robert Kocharian, will contribute to
the peace process, Turan reported. LF

AZERBAIJAN'S DEFENSE MINISTER DENIES CRIMINAL PROCEEDINGS
OPENED AGAINST HIM. Safar Abiev told Turan on 1 September
there is no truth to a report published that day in the
opposition newspaper "Yeni Musavat" that the Azerbaijani
military prosecutor has opened criminal proceedings against
him. In July, President Aliev decreed the creation of a
special commission to investigate the finances of the Defense
Ministry following allegations that Abiev had engaged in
embezzlement (see "RFE/RL Caucasus Report," Vol. 2, No. 35,
26 August 1999). LF

AZERBAIJANI, GEORGIAN PEACEKEEPING CONTINGENTS LEAVE FOR
KOSOVA. An Azerbaijani platoon of 32 soldiers, together with
one senior lieutenant and one warrant officer, and a Georgian
platoon of 34 soldiers and one officer departed for Turkey on
1 September for one month's training with the Turkish army.
Thereafter, the two detachments will be deployed in Kosova as
part of the Turkish contingent with KFOR in the German
sector, Turan and Caucasus Press reported on 1 September. The
Georgian contingent will remain in Kosova for eight months.
Georgian President Eduard Shevardnadze said on 30 August that
Georgia decided to participate in the Kosova peacekeeping
operation partly as a matter of prestige and partly in the
hope that the international community may decide to deploy a
similar force in Abkhazia if one is needed, Caucasus Press
reported. LF

LEADING AZERBAIJANI OPPOSITION PARTIES DECIDE TO PARTICIPATE
IN LOCAL ELECTIONS. Meeting in Baku on 1 September, the
opposition parties united in the Democratic Congress,
including the Azerbaijan Popular Front Party and the Musavat
Party, announced they will field candidates in the 12
December local elections, Turan reported. The same day,
Gerard Stoudman, who is director of the OSCE Office for
Democratic Institutions and Human Rights, urged Azerbaijani
parliamentary speaker Murtuz Alesqerov to amend the law on
the Central Electoral Commission to ensure that all political
forces are represented on that body. Stoudman also offered
assistance in drafting amendments to the law on municipal
elections to "eliminate ambiguities," according to Turan, and
urged Alesqerov to bring other legislation into line with
OSCE principles. Opposition representatives claim that the
municipal election law is undemocratic. But Alesqerov
insisted to Stoudman that it takes account of recommendations
by the OSCE and other international organizations and
complies with international standards. LF

CUSTOMS OFFICER SHOT DEAD IN ABKHAZIA. One Abkhaz customs
officer was shot dead and three wounded in an ambush on 1
September, Interfax and Caucasus Press reported. The incident
took place 5 kilometers from the internal border between
Abkhazia and the rest of Georgia in the security zone
patrolled by CIS peacekeepers. A local Abkhaz official blamed
Georgian guerrillas for the shootings. The previous day, an
Abkhaz military court sentenced a Georgian to death on
charges of organizing terrorist attacks in Tkvarcheli in
January 1998, Interfax reported. Two other Georgians received
prison sentences of 12 and 15 years. LF

GEORGIAN DISPLACED PERSONS OPPOSE EXTENSION OF PEACEKEEPERS'
MANDATE. Vakhtang Orzhonia, who is a spokesman for ethnic
Georgians forced to flee Abkhazia during the 1992-1993 war
and who now live in Zugdidi Raion, told Caucasus Press on 1
September that the displaced persons are unhappy with the
Georgian leadership's 29 August decision to endorse an
extension of the mandate of the CIS peacekeeping force
deployed along the border between Abkhazia and the rest of
Georgia (see "RFE/RL Newsline," 30 August 1999). The
displaced persons have no faith in the peacekeepers' ability
to guarantee the safety of Georgians wishing to return to
Abkhazia. Orzhonia said the displaced persons will register
their dissatisfaction with the Georgian leadership's decision
when casting their votes in the 31 October parliamentary
election. LF

KAZAKHSTAN'S PRESIDENT LOOKS AHEAD TO ELECTIONS... Addressing
a parliamentary session on 1 September, Nursultan Nazarbaev
said that Kazakhstan will enter the 21st century "as a
country respecting democratic principles," RFE/RL's Astana
bureau reported. He said the parliamentary elections
scheduled for 17 September and 10 October will be held
according to "real democratic principles." But Nazarbaev
warned that unnamed politicians contending the poll have no
creative programs and seek only to satisfy personal ambitions
that might "lead to the collapse of the Kazakhstan"s unity,
its sovereignty, and statehood." In a possible allusion to
former Premier Akezhan Kazhegeldin, whose participation in
the poll is uncertain, Nazarbaev castigated "those who want
revenge,...politicians who used to be officials until just
recently, and who failed to meet their duties and
obligations, who committed numerous mistakes." LF

...ASSESSES ECONOMY. While giving an overall positive
assessment of the country's economic performance in 1999,
Nazarbaev criticized the cabinet and the National Bank for
what he termed "tactical mistakes" in 1998 and 1999, in
particular the de facto devaluation of the national currency
in April of this year. "It was a big mistake to let the tenge
float," Nazarbaev said. He called on the cabinet and National
Bank to formulate a more flexible and fruitful policy in
keeping with the current world economic situation. Given the
impact of world economic processes on Kazakhstan's economy,
he said, it is inappropriate to continue implementing reforms
in the pension and taxation systems. Nazarbaev downplayed
fears of a further deterioration of the economic situation,
affirming that "there will be no hunger and cold in
Kazakhstan. We will pay our debts," Reuters reported. LF

ELEVEN POLITICAL PARTIES REGISTERED FOR KAZAKH PARLIAMENTARY
ELECTIONS. Speaking at a press conference in Astana on 1
September, Central Electoral Commission chairwoman Zaghipa
Balieva said that a total of 11 political parties have
registered to contend the 10 October elections to the lower
house of the parliament, RFE/RL's Astana bureau reported. Ten
of the 77 seats in the lower house will be allocated under
the proportional (party list) system. According to Nazarbaev,
an average of nine candidates will compete for each seat in
the lower house, while 35 candidates will contest the 16
seats in the Senate (upper house) elections on 17 September.
LF

KAZAKH, RUSSIAN OFFICIALS BEGIN TALKS ON BORDER DEMARCATION.
The first round of Kazakh-Russian talks on delineating the
state frontier between the two countries opened in Moscow on
31 August, RFE/RL's Kazakh service reported the following day,
citing a Kazakh Foreign Ministry press release. LF

UZBEK GUERRILLAS IN KYRGYZSTAN RELEASE ANOTHER HOSTAGE...
Late on 1 September, the Uzbek guerrillas entrenched in
southern Kyrgyzstan released another of the Kyrgyz police
officers they took hostage 10 days earlier, Reuters reported.
They continue to hold 13 hostages, including four Japanese
geologists and a Kyrgyz Interior Ministry general. National
Guard commander Abdygul Chotbaev told RFE/RL in Bishkek on 1
September that there has been no fighting between Kyrgyz
forces and the guerrillas for several days. He added that
several residents of villages in Batken and Chon-Alai Raions
that are occupied by the guerrillas have managed to escape.
LF

...AMID CONFUSION OVER THEIR OBJECTIVES. Kyrgyzstan's acting
Defense Minister General Esen Topoev said in Bishkek on 2
September that the guerrillas have still not made any demands
on the Kyrgyz leadership, RFE/RL's bureau in the Kyrgyz
capital reported. On 31 August, a man claiming to be a
spokesman for Tohir Yuldashev, military commander of the
Uzbek Islamic Movement, told the BBC that the guerrillas want
to exchange their hostages for members of the Uzbek Islamic
Movement currently imprisoned in Uzbekistan (see "RFE/RL
Newsline," 1 September 1999). LF

RUSSIA, UZBEKISTAN DISCUSS RESPONSE TO KYRGYZ HOSTAGE CRISIS.
Russian Defense Minister Igor Sergeev flew to Tashkent on 1
September at President Yeltsin's behest to discuss the Kyrgyz
hostage taking with President Islam Karimov. He told Interfax
on arriving in Tashkent that "it will be very difficult to
solve the problem of Islamic extremism and terrorism in
Central Asia if regional leaders do not coordinate their
moves." Sergeev later told journalists that a special team of
military experts from Russia, Kyrgyzstan, Kazakhstan,
Tajikistan, and Uzbekistan has been charged with assessing
the situation, including the number of the guerrillas, and
formulating a plan of action. He added that Russia will
supply Kyrgyzstan with arms, ammunition, Su-24 bombers and
Su-25 fighter aircraft and teach Kyrgyz troops how to wage
war in mountain conditions, according to Interfax. Sergeev
stressed that "Uzbekistan, the largest Central Asian state,
cannot distance itself from the situation in Kyrgyzstan." LF

UZBEKISTAN CELEBRATES INDEPENDENCE ANNIVERSARY. In a 1
September address to the people of Uzbekistan to mark the
eighth anniversary of the country's independence, President
Karimov said "we will have to do a lot of work and overcome
numerous obstacles" in order to achieve the country's top
priority of creating " a just and civilized democratic
society," Interfax reported. LF

TAJIK OPPOSITION TO NOMINATE JOINT PRESIDENTIAL CANDIDATE? At
a five-hour meeting in Dushanbe on 31 August, representatives
of the political parties and movements aligned in the United
Tajik Opposition agreed that they will each nominate a
candidate for the upcoming presidential elections, ITAR-TASS
reported the following day. They will then agree on a single
candidate to represent the opposition in that poll. LF

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