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RFE/RL Newsline, Vol. 3, No. 168, 99-08-30Radio Free Europe/Radio Liberty: Newsline Directory - Previous Article - Next ArticleFrom: Radio Free Europe/Radio Liberty <http://www.rferl.org>RFE/RL NEWSLINEVol. 3, No. 168, 30 August 1999CONTENTS[A] TRANSCAUCASUS AND CENTRAL ASIA
[B] SOUTHEASTERN EUROPE
[C] END NOTE
[A] TRANSCAUCASUS AND CENTRAL ASIA[01] ARMENIAN PARLIAMENT APPROVES AUSTERITY MEASURESDeputiesvoted overwhelmingly on 28 August to endorse the measures that Prime Minister Vazgen Sargsian proposed in late July to bridge an anticipated 31 billion dram ($58 million) budget shortfall, RFE/RL's Yerevan bureau reported. Those measures include higher excise duties on gasoline and cigarettes and cuts in some infrastructure projects and non-essential expenditures in the social and education sectors (see "RFE/RL Newsline," 29 July and 19 August 1999). In addition, the government needs to divert more than 17 billion drams toward paying state enterprises' debts to the energy sector. The IMF and World Bank have said that disbursement of some $55 million in new loans is contingent on that latter step. LF [02] DATE SET FOR TRIAL OF ARMENIAN FORMER INTERIOR MINISTERThetrial will begin in a Yerevan district court on 9 September of former Yerevan Mayor and Interior Minister Vano Siradeghian, RFE/RL's Yerevan bureau reported on 27 August. Siradeghian is charged with ordering several contract killings in 1994-1996 when he was interior minister. Some 229 people will be summoned as witnesses in the trial, which the presiding judge Samvel Torosian denies is politically motivated. The previous Armenian parliament voted in February to strip Siradeghian, chairman of the former ruling Armenian Pan-National Movement, of his deputy's immunity. The previous month, it had failed to raise the majority needed to do so (see "RFE/RL Newsline," 26 January and 18 February 1999). LF [03] ARMENIA SENDS EARTHQUAKE RELIEF TO TURKEYThe Armeniangovernment dispatched a plane load of emergency supplies, including medication and mobile generating stations, to Turkey on 27 August for victims of the 17 August earthquake, RFE/RL's Yerevan bureau reported. The Turkish authorities failed to respond to the Armenian government's earlier offer to send a rescue team (see "RFE/RL Newsline," 18 August 1999). LF [04] AZERBAIJANI OPPOSITION SLAMS PRESIDENT'S KARABAKH POLICY...The Movement for Democracy, which is composed of 23opposition parties, issued a statement on 27 August announcing it will begin protest actions on 10 September against what it termed President Heidar Aliev's "defeatist policy" aimed at resolving the Karabakh conflict, Turan reported. The previous day, the opposition Democratic Congress had issued a statement in which it rejected as a "violation of national interests" the proposal contained in the most recent OSCE Minsk Group Karabakh peace plan whereby Azerbaijan and the unrecognized Nagorno-Karabakh Republic form a "common state." The statement called for Armenia's immediate compliance with four 1993 UN Security Council resolutions on Karabakh demanding the withdrawal of Armenian forces from occupied Azerbaijani territory. It also argued that autonomy for Nagorno-Karabakh should be balanced by autonomous status for the estimated 200,000 ethnic Azerbaijanis who fled Armenia in 1988. LF [05] ...AS SUPPORT GROWS FOR HUNGER STRIKESome 180 members ofAshraf Mehtiev's Geyrat Party staged a one-day hunger strike on 28 August as a gesture of solidarity with nine members of the opposition Coordination Council on Karabakh who began fasting on 23 August to demand Armenia's compliance with the four UN Security Council resolutions, Turan reported. The hunger-strikers have also condemned the 22 August meeting in Geneva between President Aliev and his Armenian counterpart, Robert Kocharian, and have demanded that Aliev make public the content of those talks. Several opposition party leaders, editors of several independent and opposition newspapers, and the heads of two independent journalists' unions met with the hunger-strikers on 27 August. LF [06] GEORGIA DECIDES TO REQUEST EXTENSION OF CIS PEACEKEEPERS'MANDATEMeeting behind closed doors on 29 August, Georgia's National Security Council approved extending the mandate of the Russian peacekeeping force deployed under a CIS mandate along the border between Abkhazia and the rest of Georgia, Caucasus Press reported. The force's mandate expired on 31 July and must be renewed by CIS heads of state at their next summit, scheduled for October. Revaz Adamia, chairman of the parliamentary committee on defense and security, had argued last week that the peacekeepers' withdrawal could precipitate a new outbreak of fighting. According to Tamaz Nadareishvili, chairman of the Abkhaz parliament in exile, the Security Council decision to approve an extension of the peacekeepers' mandate is conditional on their redeployment throughout Abkhazia's southernmost Gali Raion and the southern part of neighboring Ochamchire Raion. CIS heads of state had endorsed that deployment in March 1997, but the Abkhaz authorities opposed it (see "End Note," "RFE/RL Newsline," 29 April 1997). LF [07] FOUR HOSTAGES RELEASED IN KYRGYZSTANThe Islamic militantswho seized several villages in Kyrgyzstan's Osh Oblast last week released four of their hostages late on 28 August. The four released hostages confirmed that the Kyrgyz Interior Ministry general and the four Japanese geologists taken hostage on 22-23 August are still alive. On 27 August, Kyrgyz President Askar Akaev issued a decree on mobilizing reservists, some 2,000 of whom were sent the following day to fight the militants. Meeting with Kyrgyz Foreign Minister Muratbek Imanaliev in Osh on 28 August, the defense, foreign, and security ministers of Kazakhstan, Uzbekistan, and Tajikistan offered assistance, including sending troops to neutralize the guerrillas. A Russian Defense Ministry spokesman had told ITAR-TASS on 27 August that the CIS Collective Security Treaty provides a legal basis for Russian participation in such an operation, but as of 28 August Moscow had not officially responded to Bishkek's appeal for Russian military assistance. LF [08] UZBEK PLANES KILL KYRGYZ VILLAGERS IN BOMBING RAIDPresidentAkaev told journalists in Bishkek on 30 August that 12 Kyrgyz villagers were killed and 40 homes damaged in a bombing raid by Uzbek aircraft on villages in the Chong-Alai district of Osh Oblast on 29 August, RFE/RL's Bishkek bureau reported. Subsequent reports give a lower death toll. Uzbek aircraft had mistakenly bombed Kyrgyz territory two weeks earlier in a similar attempt to destroy the guerrilla band (see "RFE/RL Newsline," 17 and 18 August 1999). Akaev sent Prime Minister Amangeldy Muraliev and Presidential Administration Defense and Security Department head General Bolot Djanuzakov to Osh to assess the situation. In Tokyo, a cabinet spokesman told journalists on 30 August that Prime Minister Keizo Obuchi has written to the presidents of Uzbekistan and Tajikistan requesting their assistance in locating and releasing the four Japanese hostages, ITAR-TASS reported. LF [09] U.S. WATCHDOG PROTESTS HARASSMENT OF KYRGYZ NEWSPAPER OWNERThe New York-based Committee to Protect Journalists haswritten to President Akaev to protest the harassment by the Kyrgyz State Tax Police of Aleksandr Kim, owner and chief editor of the independent daily "Vechernii Bishkek," RFE/RL's Bishkek bureau reported on 28 August, citing the Kyrgyz Committee for Human Rights. The State Tax police opened a criminal case against Kim last week (see "RFE/RL Newsline," 26 August 1999). LF [10] THREE KILLED IN TAJIK SHOOTOUTThree people were killed andnine wounded on 29 August during a 10-minute gun battle in a Dushanbe market between Tajik Interior Ministry forces and guards to the Commission for National Reconciliation, Reuters and Interfax reported. The reason for the clash is not known. LF [B] SOUTHEASTERN EUROPE[11] NORWAY CALLS FOR MACEDONIA TO FREE PEACEKEEPERA vehicledriven by two Norwegian KFOR soldiers hit a car carrying Macedonian Minister without Portfolio Radovan Stojkovski, his wife, and daughter on 28 August southeast of Skopje. The Stojkovskis died in the crash. Their driver and the two soldiers were injured. The two soldiers, who had been driving on the left side of the highway, refused to take a breath test. Spokesmen for the Macedonian government and KFOR engaged in mutual recriminations over the incident. On 29 August, Macedonian police arrested the Norwegian driver in the hospital. The next day, Norwegian Foreign Minister Knut Vollebaek said on Norwegian television that Macedonian authorities violated their agreement with KFOR, which specifies that peacekeepers must be prosecuted in their home countries. Vollebaek demanded the driver's release. The second Norwegian has meanwhile arrived in Kosova. PM [12] RED CROSS: SERBS HOLD 2,000 KOSOVARSA spokeswoman for theInternational Committee for the Red Cross said in Geneva on 30 August that the Serbian authorities are holding at least 2,000 ethnic Albanians from Kosova in Serbian prisons. She said that the prisoners include those who have been in Serbian jails for a long time, those taken to Serbia during the recent conflict, and those sent to Serbian jails when Serbian forces left Kosova in June. Among those held is student leader Albin Kurti (see "RFE/RL Newsline," 13 August 1999). On 27 August, several thousand people held a silent march through Prishtina to demand the prisoners' release. Among those participating was the UN's Bernard Kouchner. PM [13] HOLBROOKE: 'PROGRESS, PROBLEMS' IN KOSOVAU.S. Ambassador tothe UN Richard Holbrooke said in Prishtina on 29 August that "sometimes forging a peace is more difficult than winning a war." He added that "this place has been a mess for a long time, but a different kind of mess. The war was messy, the decade that preceded the war was messy, the history back to 1912 was messy...and the [current] task is immense." He praised the role of the UN and of KFOR. Holbrooke said after meeting with Serbian Orthodox Archbishop Artemije that any attack on cultural monuments is a "criminal, vandal act." Holbrooke noted that ethnic Albanian leader Hashim Thaci assured him that he would do "anything in his power" to make Kosova a pluralistic society. The ambassador stressed that "the most important thing is that Albanians now can decide about their own destiny and that NATO forces are here to provide security for everybody." PM [14] EXPLOSION DAMAGES MONUMENT IN PRISHTINAA blast from anexplosive charge weakened the foundations of the communist- era Brotherhood and Unity Monument in central Prishtina on 28 August. No one was injured. KFOR peacekeepers subsequently removed additional explosive charges from the monument. PM [15] DRASKOVIC DRAWS CLOSER TO MILOSEVICVuk Draskovic's SerbianRenewal Movement issued a statement in Belgrade on 29 August accusing KFOR and the UN mission in Kosova of being "essentially in close cooperation with the [Kosova] Liberation Army." KFOR and the UN thereby "help accomplish the most monstrous plans of the Albanian terrorists and separatists," AP reported. The Serbian authorities made similar charges against the U.S. last week (see "RFE/RL Newsline," 27 August 1999). In an apparent reference to Draskovic, opposition leader Veran Batic said on 30 August that one of the foundations of Yugoslav President Slobodan Milosevic's rule is the group of opposition leaders who cooperate with him. The other sources of Milosevic's power are "electoral fraud, media manipulation, and repression," Batic added. PM [16] VEDRINE: SERBIA COULD LOSE CLAIM TO KOSOVAFrench ForeignMinister Hubert Vedrine told "Le Figaro" of 28 August that Serbia must replace Milosevic if it wants to keep Kosova. The minister stressed: "If the regime does not change, the sovereignty of Yugoslavia...will be increasingly contested. Conversely, the installation of a democratic regime boosts the chances for a combination of Yugoslav sovereignty and an autonomous [Kosova]." In a warning to the ethnic Albanians, Vedrine said that "nothing will be possible if security is not assured for all. That is a precondition for [the broad- ranging self-government that] is to follow." He nonetheless rejected the Serbian proposal to set up ethnic Serbian "cantons" (see "RFE/RL Newsline," 26 August 1999). Vedrine argued that "we have to find other methods to ensure security and coexistence." PM [17] MONTENEGRIN MINISTER WARNS CLANSInterior Minister VukasinMaras said in Podgorica on 29 August that the government will firmly oppose any attempt by "tribes" to secede from Montenegro and attach the territory they inhabit to Serbia, RFE/RL's South Slavic Service reported. He was referring to a gathering of the Vasojevic clan in the north the previous day. Speakers at that meeting said that they will "defend Yugoslavia by all means" and secede from Montenegro should that republic withdraw from the Yugoslav federation. Observers note that clans form the basis of Montenegrin society and play a key role in political life. PM [18] DJILAS: MONTENEGRO KEY TO CHANGESociologist and politicalcommentator Aleksa Djilas, who is the son of leading communist-era dissident Milovan Djilas, said that the most serious threat to Milosevic comes from Montenegrin President Milo Djukanovic, the Frankfurt-based Serbian daily "Vesti" reported on 30 August. Djilas stressed that the Serbian opposition is not sufficiently united to challenge Milosevic successfully. Djilas argued that sooner or later Milosevic will have to agree to Djukanovic naming a new federal prime minister. That will mark the end of Milosevic's grip on power, the commentator continued. PM [19] BILDT: REFORM MUST ACCOMPANY BALKAN RECONSTRUCTIONCarlBildt, who is UN Secretary- General Kofi Annan's senior envoy to the Balkans, said in New York that southeastern Europe needs thorough-going political and economic reforms in addition to development assistance. Bildt stressed that old- style communist systems remain in place in much of the region and that "crony capitalism" predominates in some post- communist societies like Croatia and Bosnia, the "International Herald Tribune" reported on 30 August. Bildt identified Serbia as the core of the problem. "It's such a big chunk of land in the middle of the Balkans that if it does not reform itself, it will be very difficult to do anything substantial with the rest. Serbia is the core nation of the region," Bildt concluded. PM [20] DID BOSNIAN SERB GENERAL RISK ARREST IN VIENNA?Unknownpersons leaked the secret list of war criminals indicted by the Hague-based tribunal to the Bosnian Serb authorities "weeks ago," Reuters quoted the Dutch daily "De Volkskrant" as saying on 30 August. The daily argued that General Momcilo Talic knew that he was on the list and risked arrest last week in Vienna (see "RFE/RL Newsline," 27 August 1999). The newspaper quoted an unnamed former Bosnian Serb military official as saying that Talic "was blinded by power and status.... He thought that his senior position in the army rendered him" immune from arrest. PM [21] CROATIA PREPARING TO EXTRADITE 'TUTA'?A Zagreb county courtmay soon decide to extradite Mladen "Tuta" Naletilic to The Hague, where he is wanted for war crimes in conjunction with the 1993-1994 Croatian-Muslim conflict in Bosnia-Herzegovina, "Novi List" reported on 30 August. Croatia's failure to extradite Tuta has led to serious tensions in its relations with the tribunal and with Washington (see "RFE/RL Newsline," 27 August 1999). AP reported that some Croatian authorities are reluctant to extradite Tuta lest he implicate top officials in his testimony. PM [22] MOLDOVAN PREMIER IN ROMANIAIon Sturza unexpectedly arrivedin Romania on 27 August on a visit scheduled to begin three days later. After meeting with President Emil Constantinescu the next day, Sturza said that prospects for improving relations "have never been better" because both countries are ruled by centrist coalitions. He added that Moldova is particularly interested in the development of the transportation links between the two countries and in energy deliveries. Romania, he said, must become a "main electricity supplier" for Moldova. He also said that Romania will assume a 51 percent stake in the Moldovan Tirex Petrol Company. With regard to the pending basic treaty between the two countries, Sturza said the governments must "take over [from experts] the finalization" of that document, adding that he hopes it will be ready for signing by year's end. On 30 August, Sturza is scheduled to meet with Prime Minister Radu Vasile and the chairmen of the parliament's two chambers. MS [23] MOLDOVAN PRESIDENT RE-WRITES HISTORYSpeaking at ceremoniesmarking Moldova's Independence Day on 27 August, President Petru Lucinschi said the day marks "the common denominator of our national history throughout the 640 years that passed since [the first declaration of] Moldovan statehood," RFE/RL's Chisinau bureau reported. For the first time since independence was declared in 1991, a military parade took place in Chisinau to mark the anniversary. MS [24] DIMITROV MAUSOLEUM DEMOLISHED IN SOFIAWorkers in Sofia on28 August completed the dismantling of the mausoleum that housed the body of Communist leader Georgi Dimitrov, BTA reported. Dimitrov's body was removed from the tomb and cremated in 1990 (see "RFE/RL Newsline," 23 August 1999). MS [25] BULGARIAN PARTIES BRACE FOR LOCAL ELECTIONSThe two partiesrepresenting ethnic Turks--the Movement for Rights and Freedoms and the Party of Democratic Changes--have concluded an agreement on cooperation in the October local elections, BTA reported. leader Also on 28 August, the Liberal Democratic Alternative (LDS) and the Euro-Left signed an agreement on "pragmatic cooperation." LDS leader and former President Zhelyu Zhelev, said the agreement lays the foundation for a new liberal centrist formation. MS [C] END NOTE[26] BULGARIA'S ECONOMY ANAEMIC UNDER CURRENCY BOARDBy Michael WyzanIn July 1997, in the aftermath of a severe economic crisis, Bulgaria introduced a currency board arrangement (CBA), under which the exchange rate is fixed to the Deutsche mark and the only changes in the money supply must arise from inflows and outflows of foreign currency. Such an arrangement, which has also been adopted by transition countries Bosnia-Herzegovina, Estonia, and Lithuania, is designed to instill credibility in economic policy. It has been universally successful in bringing down inflation and interest rates to acceptable levels. A study by IMF economists found that countries employing CBAs have lower inflation and more rapid economic growth. The Bulgarian experience corroborates the results of that study as far as inflation is concerned. After experiencing 578.6 percent consumer price inflation (December to December) in 1997 (242.7 percent in February 1997 alone), such inflation was just below 1 percent in 1998 and stood at 1.7 percent in the 12 months to July 1999. The fall in the national bank's annual base interest rate was equally dramatic, from a peak of 300 percent in September 1996 to the current 4.42 percent. Bulgaria's experience with economic growth, however, has been less encouraging. While GDP was up by 18.9 percent in the first quarter of 1998 over the very depressed first quarter of 1997, the recovery quickly ran out of steam. For 1998 as a whole, the rate of GDP growth was only 3.5 percent, and this indicator fell by 0.7 percent in the first quarter of 1999, even before the effects of the Kosova crisis began to be felt. The official forecast is for GDP to grow by 1.5 percent this year, although many observers expect a decline. Industrial production was down by 16.2 percent in the first quarter, compared with the first three months of 1998. Wages have recovered to pre-crisis levels under the CBA, even if production has yet to do so. The average monthly wage in the public sector, which had fallen to $25 in February 1997, recovered by May 1999 to $124--close to the post- communist peak of $128 in September 1993. The unemployment rate, at 13.04 percent in May, has moved in no particular direction during the CBA era. The rapid rise in wages may not have led to higher unemployment, but some argue that it has played a role in Bulgaria's deteriorating current account balance. From January-May, the current account deficit was $433.5 million, up from $88.2 million a year earlier. This is a significant change for a country that has typically run surpluses or small deficits. Behind the current account imbalance during the first five months stands a trade deficit of $357.4 million (up from $48.5 million a year earlier). While growing trade and current account imbalances are common after successful macroeconomic stabilizations, it is striking that in Bulgaria these deficits result from declines in exports, rather than increases in imports as the economy expands. Both exports and imports were lower during the period January-May, compared with the same period in 1998, but exports fell by 22.7 percent and imports by only 5.6 percent. There are a number of factors that contributed to the export collapse. Some are related to the crisis in Kosova, which cut off trade with Yugoslavia and trade routes to the EU through that country (some 50 percent of Bulgarian exports were transported through Yugoslavia before the war). Another factor is the continuing effect of the Russian crisis, which has caused a significant drop in trade with that country. Exports to Russia were only $39.7 million from January-March, compared with $272 million during that period last year. Under the CBA, there is not much scope for growth of the money supply when the country is running current account deficits and receiving relatively little foreign direct investment ($85.2 million in the first four months, down from $199.2 million during that period last year). Moreover, only a small share of the credit generated has gone to enterprises. Banks, which were burned during the pre- CBA era by enterprises that never repaid loans, would rather lend to the government or foreigners. However, there has been improvement on this front. Whereas loans to enterprises accounted for 23.7 percent of banks' financial assets at the end of 1997, that figure had risen to 32.1 percent by the end of 1998. Large persistent current account deficits will make the CBA difficult to sustain. To avoid such strains, Bulgaria will have to do a better job in placing its exports on Western markets and/or in attracting foreign investment. Estonia, whose economy has performed well under the CBA (which was introduced in 1992), has excelled in both respects. The author is a research scholar at the International Institute for Applied Systems Analysis in Laxenburg, Austria. 30-08-99 Reprinted with permission of Radio Free Europe/Radio Liberty
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