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RFE/RL Newsline, Vol. 3, No. 92, 99-05-13Radio Free Europe/Radio Liberty: Newsline Directory - Previous Article - Next ArticleFrom: Radio Free Europe/Radio Liberty <http://www.rferl.org>RFE/RL NEWSLINEVol. 3, No. 92, 13 May 1999CONTENTS[A] TRANSCAUCASUS AND CENTRAL ASIA
[B] SOUTHEASTERN EUROPE
[C] END NOTE
[A] TRANSCAUCASUS AND CENTRAL ASIA[01] ARMENIA, GREECE VOW TO EXPAND ECONOMIC COOPERATIONSpeaking at a joint news conference in Yerevan on 12 May, Presidents Robert Kocharian and Constantine Stefanopoulos characterized political relations between their two countries as "just excellent," with their approaches to most issues "almost identical," RFE/RL's Yerevan bureau and Interfax reported. But they stressed that their expanding bilateral ties, which include military cooperation, "should not be viewed as an alliance against any other country," meaning Turkey. The two presidents said future cooperation will focus on the economic sphere. At a separate meeting with Armenian parliamentary deputies, Stefanopoulos pledged his country's support for Armenia's aspiration to be granted full membership in the Council of Europe. Three inter-governmental economic agreements were signed during Stefanopoulos's three-day visit, which ends on 13 May. LF[02] AZERBAIJANI PRESIDENT, OPPOSITION COMMENT ON KARABAKH CEASE- FIRE ANNIVERSARYIn a 12 May statement pegged to the fifth anniversary of the signing of a Karabakh cease-fire agreement, Heidar Aliev pledged that his country will continue to honor that truce, ITAR-TASS reported. The signatories to that accord were Armenia, Azerbaijan, Russia, and the unrecognized Nagorno- Karabakh Republic. Aliev noted that the cessation of hostilities enabled Azerbaijan to consolidate its statehood and build an army. He said Baku will continue to strive for a peaceful settlement of the conflict that will entail the liberation of occupied territories and enable displaced persons to return to their homes. But Azerbaijan Popular Front Party chairman Abulfaz Elchibey criticized the cease-fire as Aliev's most egregious mistake, while Musavat Party chairman Isa Gambar deplored the fact that the last five years were not used to implement democratic reforms and prepare for a new war to liberate the occupied territories, according to Turan. LF[03] AZERBAIJAN, RUSSIA CRACK DOWN ON CROSS-BORDER CRIMEIn a coordinated campaign over the past two months, the Russian and Azerbaijani Interior Ministries have eradicated two criminal gangs operating on the border of the two countries and have seized arms, ammunition, seven stolen cars, 2,500 liters of contraband alcohol, and more than four tons of sturgeon and 30 kilos of caviar, ITAR-TASS reported. A total of 55 wanted criminals have been arrested. LF[04] UN URGES GEORGIA, ABKHAZIA TO BACK PEACE PROCESS, REPATRIATIONIn a 7 May letter, the UN Security Council called on the Georgian and Abkhaz leaderships to display the "necessary will" to achieve a breakthrough in ongoing talks on a settlement of the Abkhaz conflict, dpa and Caucasus Press reported. The letter underscored the "imprescriptible right" of displaced persons to return to their homes in a secure environment. But on 13 May, Caucasus Press quoted Anri Djergenia, Abkhaz President Vladislav Ardzinba's envoy, as describing the talks as deadlocked. Djergenia blamed that deadlock on the Georgians who, he said, have proposed no further meeting since the 29 April talks in Sukhumi under UN auspices (see "RFE/RL Caucasus Report," Vol. 2, No. 18, 6 May 1999). Djergenia also said a preliminary investigation has refuted Georgian allegations that Russian peacekeepers were responsible for the deaths of four Georgians killed in the Abkhaz village of Bargebi on 12 May. LF[05] CONSTRUCTION OF KAZAKH OIL EXPORT PIPELINE BEGINSEnergy executives and officials from Kazakhstan, Russia, the U.S., and Oman gathered in Novorossiisk on 12 May to witness the start of construction of a marine terminal for the planned 1,580 kilometer oil export pipeline from Kazakhstan's Tengiz field, Reuters reported. The $2.2 billion project, in which Chevron is the major shareholder, is scheduled for completion in mid-2001. LF[06] KAZAKHSTAN MAY FACE GRAIN SHORTAGEIndustry, Trade, and Energy Minister Mukhtar Ablyazov told Interfax on 12 May that unless the state grain policy is changed, Kazakhstan may have to begin importing grain. He said that last year's harvest of 7.6 million metric tons was down 44 percent on the 1997 figure. In late April, an Agriculture Ministry official told Reuters that although the area sown this year will probably be smaller than in 1998, the country could theoretically harvest 10 million tons of grain and export some 3 million tons. LF[07] KYRGYZ HUMAN RIGHTS ACTIVISTS STAGE PROTESTSome 400 members of the disbanded Kyrgyz Committee for Human Rights picketed the government building in Bishkek on 12 May to demand the resignation of Justice Minister Nelly Beishenalieva and the re-registration of the committee by the Ministry of Justice, RFE/RL's Bishkek bureau reported. The ministry had revoked the 1996 registration of the committee in October 1998, claiming that the original documentation contained errors, and had rejected subsequent applications to re-register the committee. But in April 1999, the ministry registered a committee of the same name headed by the deputy chairman of the dissolved committee. Three senior members of the government and presidential administration met with the protesters and undertook to form a commission to investigate the case. LF[08] TURKMENISTAN, AFGHANISTAN CONCLUDE AIR TRANSPORT, GAS AGREEMENTSDuring Taliban Deputy Foreign Minister Abdur Rahman Zahid's visit to Ashgabat last week, the Turkmen government and the Taliban signed agreements on the start of commercial flights by Ariana Afghan Airlines to Turkmenistan and on the sale of low-priced Turkmen gas to that country, Reuters reported from Kabul on 12 May. Other agreements provide for the restoration by Turkmenistan of two Afghan power plants and the sale to Afghanistan of tar to resurface highways. LF[09] CORRECTION:"RFE/RL Newsline" on 10 May incorrectly reported that in late 1998, Unocal withdrew from a project to build a gas export pipeline from Turkmenistan via Iran. That pipeline will run from Turkmenistan via Afghanistan to Pakistan.[10] UZBEKISTAN IMPOSES TOUGHER SENTENCES FOR RELIGIOUS EXTREMISMThe Uzbek parliament has voted to amend the Criminal Code to provide for prison sentences of between five and 15 years and confiscation of property of those belonging to religious, extremist, or prohibited organizations, Interfax and Reuters reported on 12 May. Membership in such organizations that commit serious crimes is punishable by 15-20 years' imprisonment. LF[B] SOUTHEASTERN EUROPE[11] SOLANA REASSURES REFUGEES THEY WILL RETURN TO KOSOVA...NATO Secretary-General Javier Solana told refugees in Elbasan, Albania, and Cegrane, Macedonia, on 12 May that NATO is determined to make sure that everybody will be able to return to their homes. He stressed that NATO must continue its air campaign against Yugoslavia until it reaches its objectives, an RFE/RL correspondent reported from Tirana. Solana said that newly arrived NATO troops have begun setting up more refugee camps in Albania. He reassured President Rexhep Meidani in Tirana that NATO will protect Albania in the event of Yugoslav aggression, adding that U.S. Apache helicopters will be deployed "very soon." Meidani told Solana that the Albanian authorities are ready to fulfill any request of NATO to help its mission. Solana also said "I am sure that whatever the final result of the change of government in Russia is, the diplomatic process will continue," Reuters reported. FS[12] ...WHILE NATO CONTINUES AIR CAMPAIGNNATO planes on 12 and 13 May attacked military airports in Prishtina and Belgrade and destroyed five aircraft on the ground. It also attacked military positions in Prishtina, Prizren, Gjakova, Decani, and Ferizaj, AP reported. Inside Serbia, NATO hit targets in Milosevic's hometown of Pozarevac, Sabac, Pancevo, and elsewhere. Serbian Radio reported strikes against Serbian Television headquarters and a transmitter station near Novi Sad. Beta said a tobacco factory was hit in Nis. Yugoslav President Slobodan Milosevic in a message carried by Tanjug on 12 May admitted heavy losses. Without giving figures, he said that "during this struggle, many members of the police and security forces died courageously." He said that "their sacrifice is a shining example of bravery and devotion to one's people and fatherland." And he commented that the members of those forces "suppressed the enemy and disabled it from undermining the power of our defense." FS[13] ALBANIAN MAYORS URGE MORE ASSISTANCE FOR BORDER VILLAGESMayors from Albanian villages along the border with Yugoslavia, meeting in Tirana on 12 May, issued a statement saying that the situation in the border area is critical. The officials said they did not receive sufficient government support to cope with the problems created by the influx of refugees and continued shelling by Serbian forces. In some villages, dozens of buildings have been destroyed by Serbian troops who briefly entered Albania or shelled the villages from across the border. UNHCR officials in Tirana, meanwhile, have expressed concern about food supplies for refugees in the northern Albanian areas. Elsewhere, several Serbian artillery shells exploded near Bajram Curri. FS[14] RUGOVA TAKES UP RESIDENCE IN GERMANYRugova, along with 16 of his relatives and advisers, took up residence near Bonn on 12 May, Reuters reported. Rugova, after meeting with German Foreign Minister Joschka Fischer, said that "the most important thing is to help those [Kosovars] who have been driven from their land to return." A spokesman said that the German minister stressed during the talks that Kosovar politicians should try to better coordinate their activities and stop arguing among themselves. The spokesman added that Rugova plans to hold talks with the foreign ministers of Britain and France at a meeting of the 15 EU foreign ministers in Brussels on 17 May. FS[15] DONORS SAY BOSNIAN CROATS SABOTAGE RECOVERYThe office of the international community's Carlos Westendorp has charged the Bosnian Croat leadership with obstructing Bosnia's economic recovery, AP reported on 12 May. A statement released at the end of an international donors' conference in Sarajevo said "the forum was sabotaged by Deputy Prime Minister Dragan Covic, who chose...to raise a number of blatantly immaterial objections." It had been expected that the Bosnian Muslim, Croatian, and Serbian leaderships would agree on measures aimed at building a unified country that would qualify the federation to receive the last $1 billion installment out of a $5.1 billion foreign aid package. The statement stressed that "it appears that...the old spirit of distrust and refusal to compromise is alive and well among some Bosnian Croat leaders." The donors said the government of the Republika Srpska must approve the budget and fulfill several other conditions in order to qualify for international assistance. FS[16] OSCE AMBASSADOR CALLS INVESTMENTS IN BOSNIA 'CRAZY'Robert Barry told Reuters in Sarajevo on 12 May that "you've got to be crazy to invest in this country where it is a given that if you obey the laws you're gonna lose money." He accused Bosnia's ruling nationalist parties of not being interested in economic reform and warned of an economic tailspin. Barry added that "if the reform doesn't come...if I were a donor, I wouldn't be putting money down a rat hole.... Unless there is economic reform no jobs will be created and after the international community goes the economy will fall back to where it was in 1995." FS[17] CROATIAN COURT TO RULE ON ABDIC EXTRADITIONAn official from the Croatian Justice Ministry said on 12 May that a county court in Rijeka will have to rule on the possible extradition of former Bosnian Muslim warlord Fikret Abdic, Reuters reported. Interpol has issued an arrest warrant against Abdic, whom the Bosnian government has charged as a war criminal (see "RFE/RL Newsline," 12 May 1999). The official said that "Croatia has made commitments to investigate and prosecute war criminals, but not in terms of extradition, especially not for its own citizens." Abdic received Croatian citizenship in 1995. FS[18] ROMANIA FOLLOWS EU LEAD ON YUGOSLAV SANCTIONSThe Romanian government has frozen Yugoslav assets on its territory and imposed a travel ban on Yugoslav President Slobodan Milosevic, his family, and other Belgrade officials, AP reported on 12 May. The steps were taken in line with the EU's sanctions against Yugoslavia. Meanwhile, the Romanian parliament approved NATO-led maneuvers on Romanian territory this winter. Some 150 NATO personnel and 100 Romanians will be trained in peacekeeping and humanitarian missions. VG[19] MOLDOVAN PRESIDENT RESHUFFLES CABINETPetru Lucinschi has replaced Tudor Botnaru with Valeriu Pasat as national security minister Infotag reported on 12 May. The president noted that Botnaru had requested to be relieved of his duties. Pasat, who until now was defense minister, will be replaced by Colonel Boris Gamurari. Vasile Nedelciuc of the Party of Democratic Forces speculated that the president made the changes in order to have a "handful of more loyal ministers" at his disposal in the event of a "possible confrontation" with the parliament, BASA-press reported on 12 May. Vladimir Reus of the Democratic Convention said he doesn't understand why the president needs to organize a non- binding referendum on expanding presidential powers when he already has enough power to "sack and name ministers." VG[20] TRANSDNIESTER LEADER AWARDED SOVIET MEDALIgor Smirnov, the leader of the breakaway region of Transdniester, has received the Star of the Soviet Union, the former USSR's highest award, BASA-press reported on 12 May. Smirnov received the award from former Soviet deputy Saji Umalatova, who describes herself as a follower of Josef Stalin. Umalatova also awarded the Transdniester security and defense ministers the Stalin Order. In other news, Moldova on 11 May announced that it will pull out of the CIS Aviation Conference, Interfax reported. Moldovan Civil Aviation Administration head Victor Copa said the CIS standards are substantially different from those of the European Civil Aviation Conference, of which Moldova is also a member. VG[21] BULGARIAN PRESIDENT CALLS FOR BALKAN SECURITY BELTBulgarian President Petar Stoyanov on 12 May said Yugoslavia should be surrounded by a "security belt" of democratic countries with parallel economic development, according to a BTA report cited by the BBC. As part of this strategy, Stoyanov said the countries surrounding Yugoslavia should be relieved of their external debts in proportion to the losses their economies suffered as a result of the Kosova conflict. He also said EU accession talks should be started with Bulgaria and Romania. Meanwhile, the opposition Bulgarian Socialist Party called on the parliament to reject any NATO requests for permission to use Bulgarian territory for ground operations against Yugoslavia. The Euro-Left has called for the removal of parliamentary chairman Yordan Sokolov in response to his comparisons of the Euro-Left with Yugoslav President Slobodan Milosevic. VG[C] END NOTE[22] ESTONIA'S BUDGET CRISIS CASTS SHADOW OVER ECONOMIC PERFORMANCEby Michael WyzanEstonia, which has long had one of the best performing transition economies, has uncharacteristically made news recently because of a budget crisis. The government on 4 May approved a "negative supplementary budget," under which expenditures this year would be cut by 1.03 billion kroons ($71 million). The document foresees reductions in government investment and subsidies to the private sector. The IMF promptly warned that cuts of at least twice that level are required. The emergence of these fiscal problems contrasts with the good news about economic policy and performance that typically emanates from Tallinn. Estonia has weathered the Russian financial crisis far better than the other two Baltic States. It has also succeeded in cooling off the economy, which overheated in 1997, and reorienting its exports to EU markets. The budget problems result, to a certain extent, from a slowdown in economic growth, as value-added and excise tax receipts have been disappointing. GDP growth slowed from 11.4 percent in 1997 to about 4 percent last year. Although the 1999 budget was based on a growth forecast of 5.5 percent, the IMF now predicts that the economy will grow by 2.5 percent this year. Sales of industrial production rose by 0.8 percent in 1998 and fell by 11.4 percent in January-March 1999, compared with the same period in 1998. Nonetheless, the most obvious fiscal problems are occurring on the expenditure side. While total consolidated budget revenues at the end of February were 3.238 billion kroons, up by 26.4 percent (in nominal terms) over the same period in 1997, expenditures were 4.063 billion, an increase of 58.2 percent. Indeed, the share of government expenditures in GDP is projected to rise to 42 percent of GDP this year (even after the budget cuts) from about 36 percent in 1996. Increased spending is related to promises made in 1998 by a centrist coalition government (which was replaced by a right-wing coalition after the elections of March 1999) that included a party representing rural interests. In the wake of the Russian crisis--which hit the agricultural and food sectors hard--and of weather-related poor harvests, promises were made to increase agricultural subsidies and raise agricultural procurement prices. In the end, farmers received 227 million kroons in subsidies. There have also been problems with controlling extra-budgetary spending in such areas as pensions. Nonetheless, the situation is not as alarming as it appears. The sale of stakes in Eesti Telekom to Telia of Sweden and Sonora of Finland will bring more than $300 million to the budget this year. More broadly, many economic indicators show that the economy continues to perform well, if somewhat worse than before the outbreak of the Russian crisis. The slowing of GDP growth last year was helpful in reducing the current account deficit from a high 12 percent of GDP in 1997. The deficit was down to a less worrying 8.6 percent last year. Especially encouraging is the fact that exports grew from $2.2 billion in 1997 to $3.2 billion in 1998, at a time when Latvian and Lithuanian exports fell. Estonia has been successful in reorienting its exports toward the EU. In 1998, the EU bought 55 percent of Estonian exports, compared with 48 percent in 1993. Finland and Sweden together took 36 percent of Estonia's exports last year. The importance of Russia as a trading partner has declined, with exports and imports falling from 23 percent and 17 percent of the respective totals in 1993 to 13 percent and 11 percent in 1998. By January 1999, that country accounted for only 8.7 percent of Estonian exports. Estonia's strong export performance is especially impressive in the light of the rapid growth of wages, as expressed in dollars or constant kroons. The gross monthly wage reached $363 in December (compared with $321 a year earlier), higher than in all other transition countries except Croatia, the Czech Republic, Hungary, Poland, and Slovenia. Real wages in kroons grew by about 4 percent last year, an increase that was approximately matched by labor productivity. This contrasts with Latvia and Lithuania, where real wage growth far outstripped productivity in 1998. The coexistence of healthy export growth and rising real wages suggests that significant restructuring is occurring at the enterprise level. Estonia's budget problems do not suggest that the country is no longer a stellar economic performer. They do imply, however, that the era of exemplary policy-making, as reflected in balanced budgets, has been replaced by a political process more similar to those of other transition countries. Reports last week that the government is working on a bill that would for the first time since independence impose import tariffs is another indicator of this trend. The author is a research scholar at the International Institute for Applied Systems Analysis in Laxenburg, Austria. 13-05-99 Reprinted with permission of Radio Free Europe/Radio Liberty
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