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RFE/RL Newsline, Vol. 3, No. 188, 99-09-27

Radio Free Europe/Radio Liberty: Newsline Directory - Previous Article - Next Article

From: Radio Free Europe/Radio Liberty <http://www.rferl.org>

RFE/RL NEWSLINE

Vol. 3, No. 188, 27 September 1999


CONTENTS

[A] TRANSCAUCASUS AND CENTRAL ASIA

  • [01] ARMENIAN MINISTER UPBEAT ON CHANCES OF WTO MEMBERSHIP
  • [02] EU TO FUND SAFETY PROGRAM FOR ARMENIAN NUCLEAR POWER STATION
  • [03] AZERBAIJAN OPPOSITION CALLS OFF PLANNED DEMONSTRATION
  • [04] SUSPECT IN GEORGIAN PRESIDENTIAL ASSASSINATION BID DETAINED
  • [05] GEORGIA WANTS COUNCIL OF EUROPE TO HELP CLOSE RUSSIAN BASES
  • [06] SOUTH OSSETIA ACCUSES GEORGIAN LEADERSHIP OF SABOTAGING
  • [07] KAZAKHSTAN'S PARLIAMENT REJECTS DRAFT BUDGET...
  • [08] ...PROMPTING PREMIER TO CALL FOR NO-CONFIDENCE VOTE
  • [09] KAZAKH, RUSSIAN PREMIERS MEET
  • [10] SITUATION STABILIZING IN SOUTHERN KYRGYZSTAN
  • [11] TAJIK PRESIDENT PARDONS OPPOSITION PRISONERS

  • [B] SOUTHEASTERN EUROPE

  • [12] ANTI-MILOSEVIC DEMONSTRATIONS PICK UP STEAM
  • [13] YUGOSLAV MINISTER SAYS OPPOSITION WORKING FOR WEST
  • [14] DRASKOVIC MEETS WITH BOSNIAN SERB LEADERS
  • [15] SERBS ARRESTED BY NATO FOR SUSPECTED INVOLVEMENT IN
  • [16] SOLANA URGES RECONCILIATION, ENDORSES CORPS
  • [17] CROATIAN FOREIGN MINISTER CRITICIZES WAR CRIMES TRIBUNAL
  • [18] IZETBEGOVIC IN MID-EAST
  • [19] DJINDJIC SEEKS SUPPORT IN MACEDONIA
  • [20] MONTENEGRINS SPLIT ON INDEPENDENCE
  • [21] ALBANIA AGREES WITH OSCE ON CORRUPTION BATTLE
  • [22] ROMANIAN MINERS CALL OFF HUNGER STRIKE
  • [23] ROMANIAN CABINET PASSES BILL TO AMEND CRIMINAL CODE
  • [24] HUNGARIAN-ROMANIAN MEMORIAL PLANNED
  • [25] NEW GOVERNOR OF GAGAUZ-YERI INAUGURATED
  • [26] BULGARIA, U.S. AGREE ON MILITARY COOPERATION

  • [C] END NOTE

  • [27] THE LONG SHADOW OF THE SECOND ECONOMY

  • [A] TRANSCAUCASUS AND CENTRAL ASIA

    [01] ARMENIAN MINISTER UPBEAT ON CHANCES OF WTO MEMBERSHIP

    The

    prospects that Armenia will be admitted to the World Trade

    Organization by the end of 1999 are "pretty bright," Trade

    and Energy Minister Hayk Gevorgian told RFE/RL's Yerevan

    bureau on 24 September. He said bilateral talks in Geneva

    between an Armenian government delegation and the WTO are

    nearing completion and will be followed by multilateral

    discussions with WTO member states. Last month, a senior US

    trade official mentioned Armenia, along with Estonia,

    Georgia, Lithuania, and Moldova, as likely to win admission

    to the WTO when the next round of global trade talks takes

    place in Seattle in November. Gevorgian said WTO membership

    would be good for both foreign investors and domestic

    businesses. Armenia's trade and investment legislation is

    seen as among the most liberal in the former Soviet Union. LF

    [02] EU TO FUND SAFETY PROGRAM FOR ARMENIAN NUCLEAR POWER STATION

    Under the terms of a recent protocol, the EU will grant

    Armenia 10 million euros ($10.04 million) annually from 2000-

    2006 to ensure the safe operating of the Medzamor nuclear

    power plant, Noyan Tapan reported on 24 September, quoting

    Armenian Energy Minister David Zadoyan. Zadoyan added that

    Armenia will abide by an earlier agreement with the EU to

    close down Medzamor by 2004 only if new generating capacities

    totaling 600 megawatts are available by that date (see

    "RFE/RL Newsline," 18 December 1998). Zadoyan said that a

    decision is likely to be made at talks with the EU in October

    on whether a new nuclear power plant should be built to

    replace Medzamor. LF

    [03] AZERBAIJAN OPPOSITION CALLS OFF PLANNED DEMONSTRATION

    Representatives of nine Azerbaijani opposition parties

    decided late on 24 September to cancel a mass demonstration

    planned for the following day, Turan reported. The opposition

    had picketed the Baku City Mayor's Office for days to demand

    permission to hold the rally. Participants in that meeting

    had intended to adopt a resolution condemning the Azerbaijani

    leadership's inability to resolve the Karabakh conflict and

    outlining its proposals for trying to do so (see "RFE/RL

    Newsline," 21 and 23 September 1999). Baku Mayor Rafael

    Allakhverdiev had refused permission to hold the rally in

    central Baku; on 24 September, he offered instead to make

    available a stadium on the city outskirts. Musavat Party

    chairman Isa Gambar told Turan on 25 September that the

    opposition decided to cancel the demonstration rather than

    risk a confrontation with the authorities by convening an

    unsanctioned rally in the city center. LF

    [04] SUSPECT IN GEORGIAN PRESIDENTIAL ASSASSINATION BID DETAINED

    Russian police in the North Ossetian capital, Vladikavkaz,

    have detained Nugzar Chukhua, a 44-year-old Georgian citizen,

    on suspicion of involvement in the unsuccessful bid to

    assassinate Georgian President Eduard Shevardnadze in

    February 1998, Caucasus Press reported on 24 September,

    citing a Georgian television report that was subsequently

    confirmed by the Georgian National Security Ministry. It is

    unclear whether Chukhua will be extradited to Georgia.

    Russian police are investigating the possibility that he may

    also have participated in the March 1999 terrorist bomb

    attack in Vladikavkaz, which killed dozens of people. If

    those suspicions prove correct, Chukhua will stand trial in

    Russia on terrorism charges. LF

    [05] GEORGIA WANTS COUNCIL OF EUROPE TO HELP CLOSE RUSSIAN BASES

    In an address to the Parliamentary Assembly of the Council of

    Europe Mikhail Saakashvili, who heads the parliamentary

    faction of the Union of Citizens of Georgia, appealed for

    help from the Council of Europe in securing the closure of

    Russia's four military bases in Georgia, Caucasus Press

    reported on 24 September. Saakashvili claimed that those

    bases serve to destabilize the internal situation in Georgia

    and that the use of the Russian ruble at those facilities

    negatively impacts on the stability of the Georgian currency

    (see "RFE/RL Newsline," 20 September 1999). He also said that

    personnel at those bases "sell arms to the hot spots in the

    Caucasus." That statement is at odds with Georgian Foreign

    Ministry denials that any arms are entering Chechnya or

    Daghestan from Georgian territory (see "RFE/RL Caucasus

    Report," Vol. 2, No. 38, 24 September 1999). LF

    [06] SOUTH OSSETIA ACCUSES GEORGIAN LEADERSHIP OF SABOTAGING

    TALKS

    In a statement issued on 24 September, Merab Chigoev,

    who heads the government of Georgia's breakaway Republic of

    South Ossetia, accused the central Georgian government of

    reneging on a previous agreement on providing economic aid

    and electricity to South Ossetia, Caucasus Press reported.

    Georgia cut off power supplies to South Ossetia on 1

    September because the local government had failed to pay its

    debt for previous energy supplies. Chigoev said that move

    risks jeopardizing the ongoing talks on defining relations

    between the central authorities in Tbilisi and the former

    autonomous region. LF

    [07] KAZAKHSTAN'S PARLIAMENT REJECTS DRAFT BUDGET...

    As

    anticipated, both chambers of Kazakhstan's parliament

    rejected the government's proposed draft budget for 2000 at a

    joint session on 25 September, Interfax reported (see "RFE/RL

    Newsline," 24 September 1999). That draft cuts social

    spending in a bid to reduce the budget deficit from 3.6

    percent to 3 percent of GDP in 1999, according to Reuters.

    But the draft also allocated about 570 million tenges ($4.1

    million) for the needs of the Kazakh parliament, a sum that

    lower chamber speaker Marat Ospanov said is exorbitant,

    RFE/RL's Kazakh Service reported. LF

    [08] ...PROMPTING PREMIER TO CALL FOR NO-CONFIDENCE VOTE

    Prime

    Minister Nurlan Balghymbaev responded to the rejection of the

    budget by calling for a vote of confidence in his cabinet,

    the second time he has done so within just over three months

    (see "RFE/RL Newsline," 22 and 24 June 1999). If the required

    two-thirds of deputies in both chambers fail to vote no

    confidence in the cabinet, the budget is automatically

    passed. Balghymbaev explained to deputies that the budget

    must be passed within the next week in order to secure a new

    IMF loan on which the government is counting in order to pay

    off external loans as well as wage and pension arrears,

    Reuters reported. Kazakhstan failed last month to reach

    agreement with the IMF on a new loan (see "RFE/RL Newsline,"

    11 and 12 August 1999). Meanwhile, on 27 September, the tenge

    was trading in Almaty at 143 to $1, down from 137.5 last

    week, RFE/RL's bureau in the former capital reported. LF

    [09] KAZAKH, RUSSIAN PREMIERS MEET

    Balghymbaev and Vladimir Putin

    expressed satisfaction at the present state of bilateral

    relations following talks in Astana on 24 September. Putin

    told journalists later that agreement was reached on settling

    mutual debts, including the rent Russia pays for the Baikonur

    cosmodrome, Interfax reported. He added that Russia will

    increase the quota for oil that Kazakhstan may export via

    Russian pipelines. In return, Kazakhstan acceded to a Russian

    request to open more consulates in the northern,

    predominantly Russian-populated oblasts of Kazakhstan,

    "Nezavisimaya gazeta" reported on 25 September. The two

    premiers also signed an agreement on cooperation in guarding

    Kazakhstan's borders. Under that accord, Moscow will provide

    two coast-guard vessels to patrol Kazakhstan's sea border. LF

    [10] SITUATION STABILIZING IN SOUTHERN KYRGYZSTAN

    Kyrgyzstan's

    Prime Minister Amangeldy Muraliev told journalists in Astana

    on 24 September that the situation in the south of the

    country has stabilized and that all approaches to the

    guerrillas' bases are blocked, ITAR-TASS reported. Meeting

    with Muraliev on the sidelines of the CIS Customs Union

    session (see above), Russian Prime Minister Putin assured him

    that Moscow fully supports Bishkek's actions against the

    guerrillas. Uzbekistan's President Islam Karimov conveyed

    similar assurances in a letter to his Kyrgyz counterpart,

    Askar Akaev. Also on 24 September, Akaev telephoned with

    Japanese Premier Keizo Obuchi to promise him that Kyrgyzstan

    is continuing to do everything in its power to secure the

    release of four Japanese geologists taken hostage by the

    guerrillas five weeks ago, Interfax reported. LF

    [11] TAJIK PRESIDENT PARDONS OPPOSITION PRISONERS

    Imomali

    Rakhmonov on 24 September issued a decree pardoning 22

    members of the United Tajik Opposition who were serving

    prison sentences ranging from eight to 14 years. Presidential

    press secretary Zafar Saidov told ITAR-TASS that the pardon

    is intended to promote trust and the process of national

    reconciliation. Also on 24 September, Tajikistan's Communist

    Party voiced its support for Rakhmonov's bid for re-election

    in the 6 November presidential poll, AP reported. LF


    [B] SOUTHEASTERN EUROPE

    [12] ANTI-MILOSEVIC DEMONSTRATIONS PICK UP STEAM

    Tens of

    thousands of Serbs took part in opposition protests on 26

    September calling for the resignation of Yugoslav President

    Slobodan Milosevic, Reuters reported. A crowd estimated at

    50,000 marched through the streets of Belgrade on the sixth

    consecutive day of protests, which are organized by the

    Alliance for Change. The previous day, 55,000 marchers were

    reported. Vladan Batic, the alliance's coordinator, said the

    protest movement has "clearly gained momentum." Momcilo

    Persic, a former Yugoslav army general sacked by Milosevic,

    said on 24 September that he will mobilize the "70 percent of

    the population [that] is angry but doesn't want to join the

    opposition." Demonstrations attended by several thousand

    people were also reported in other Serbian towns and cities.

    Observers point out that the nearly three months of mass

    demonstrations in Belgrade in 1996-1997 also began with small

    crowds. PB

    [13] YUGOSLAV MINISTER SAYS OPPOSITION WORKING FOR WEST

    Yugoslav

    Information Minister Goran Matic said on Yugoslav television

    on 26 September that the opposition Alliance for Change's aim

    is to "destroy Yugoslavia and take from it whatever they

    like," Belgrade's B2-92 reported. Matic said the problem is

    that "our citizens are being discreetly talked into

    acting...in someone else's interests." He added that

    opposition leader Zoran Djinjdjic is a NATO ally. The state

    news agency Tanjug said on 26 September that the opposition

    are "traitors" and "NATO lackeys," and it labeled the street

    protests a "fiasco." PB

    [14] DRASKOVIC MEETS WITH BOSNIAN SERB LEADERS

    Serbian opposition

    leader Vuk Draskovic met with Bosnian Serb Premier Milorad

    Dodik in Banja Luka on 24 September, AP reported. Draskovic

    said there is only hope for Serbia if President "Milosevic

    and his regime is removed." Dodik said he shares Draskovic's

    views, noting that the democratization of Serbia would be in

    the best interest of Bosnian Serbs. Draskovic said he has the

    same goal as the Alliance for Change but disagrees "on how to

    achieve it." Draskovic has refused to take part in the

    alliance's nationwide street protests. PB

    [15] SERBS ARRESTED BY NATO FOR SUSPECTED INVOLVEMENT IN

    ATTROCITIES

    The NATO peacekeeping force in Kosova (KFOR) has

    detained four Serbs suspected of committing crimes against

    ethnic Albanians, AP reported on 26 September. The four were

    in a convoy of Serbs driving toward the town of Rahovec. The

    same day, a member of the new Kosova Protection Corps was

    shot and killed in front of the corps' headquarters in

    Prishtina. In the U.S. sector two days earlier, one person

    was killed and four injured when a tractor carrying 12 Serbs

    was ambushed near Kamenice. And three other Serbs were

    injured by a bomb in Gracanice, just outside Prishtina. PB

    [16] SOLANA URGES RECONCILIATION, ENDORSES CORPS

    NATO Secretary-

    General Javier Solana said on 27 September that political

    leaders in Kosova must rebuild ethnic relations and will be

    held responsible unless they "stop the violence and hatred."

    Solana, on a visit to Prishtina, said he approves of the

    controversial Kosova Protection Corps, saying "it will not be

    a political force and it certainly will not be an army." He

    held talks on 26 September with Kosovar Serb official Momcilo

    Trajkovic and Oliver Ivanovic, the self-proclaimed mayor of

    the divided town of Mitrovice, who are demanding the

    formation of Serbian cantons and a similar protection force

    for Serbs. In the Serbian town of Obrenovac, Yugoslav army

    General Nebojsa Pavkovic said the multiethnic Kosova

    collapsed with the formation of the corps. He remarked that

    he believes Yugoslav forces will return to the province when

    the UN Security Council mandate expires. PB

    [17] CROATIAN FOREIGN MINISTER CRITICIZES WAR CRIMES TRIBUNAL

    Mate Granic said in an address to the 54th UN General

    Assembly on 26 September that the war crimes tribunal in The

    Hague is "ignoring" atrocities committed against Croats

    during the wars of Yugoslav succession, AP reported. Granic

    said the indictments do not "reflect the true nature and

    scope of war crimes committed by different sides in the

    conflict." He said some 14,000 Croats died in the conflicts

    between 1991 and 1995. Granic added that Croatia has taken

    numerous steps to aid the tribunal in its work. Zagreb has

    been criticized for not fully cooperating with the tribunal

    in the handing over of indicted suspects. PB

    [18] IZETBEGOVIC IN MID-EAST

    The Muslim member of the Bosnian

    presidency, Alija Izetbegovic, arrived in Tehran on 26

    September on a state visit, the Iranian news agency IRNA

    reported. Izetbegovic, who is to meet with Iranian President

    Mohammad Khatami, said he appreciated Iran's diplomatic and

    humanitarian support for Bosnia-Herzegovina. Izetbegovic, who

    also visited Kuwait, Turkey, and Saudi Arabia, has been

    sharply criticized by Ante Jelavic and Zivko Radisic, the

    Croatian and Serbian members of the Bosnian presidency, for

    not informing them that he was to make the trip. The Sarajevo

    weekly "Slobodna Bosna" reported that Izetbegovic is in bad

    health and that the real purpose of his visit is to receive

    secret medical treatment in Saudi Arabia. Izetbegovic

    suffered a heart attack in 1996. PB

    [19] DJINDJIC SEEKS SUPPORT IN MACEDONIA

    Serbian opposition

    leader Zoran Djindjic met with Macedonian President Kiro

    Gligorov in Skopje on 24 September, AP reported. Djindjic

    said the two discussed a "new Balkans policy concept" that

    would focus on democratization, economic development, and

    demilitarization as a means of reducing the chance of further

    conflicts. He said "our generation can halt the process of

    Balkan suffering." In other news, Greece's state airlines

    Olympic announced it has resumed twice-weekly flights from

    Athens to Skopje owing to increased bilateral ties. The two

    countries are locked in a dispute over the official name of

    Macedonia, which is the same as that of a neighboring region

    in Greece. PB

    [20] MONTENEGRINS SPLIT ON INDEPENDENCE

    A poll released in the

    Montenegrin capital of Podgorica on 24 September showed that

    44 percent of the respondents would vote for independence

    while 39 percent would back remaining part of Yugoslavia,

    ITAR-TASS reported. The survey polled 1,000 people throughout

    Montenegro and was taken by the Damar polling center. Sixty

    percent said there is a need to revise relations with Serbia.

    Only 8 percent supported Yugoslav President Milosevic. In

    other news, Serbian Trade Minister Zoran Krasic said on 24

    September that "Montenegro has just made another step toward

    secession," in reference to Podgorica's declaration the

    previous day that it is setting up its own customs and trade

    regime (see "RFE/RL Newsline," 24 September 1999). PB

    [21] ALBANIA AGREES WITH OSCE ON CORRUPTION BATTLE

    The Albanian

    government and the OSCE agreed on 24 September to wage a

    joint campaign against widespread corruption in the country,

    dpa reported. Albanian Deputy Premier Ilir Meta said

    "corruption poses a great danger to the future development of

    Albania." The OSCE commented that foreign experts will be

    involved in organizing and monitoring the Albanian

    government's progress in the fight against corruption. It

    added that the project is "indispensable for Albania to

    participate fully in and benefit from the evolving aspects of

    the stability pact for southeastern Europe." PB

    [22] ROMANIAN MINERS CALL OFF HUNGER STRIKE

    A group of 162 miners

    from the town of Lupeni called off their hunger strike on 24

    September after the government promised them jobs, an RFE/RL

    correspondent reported. The miners had been fasting for three

    weeks and were threatening to commit collective suicide. Two

    years ago, they quit their jobs when the government promised

    them compensation as well as new employment. However, the

    miners were told recently that they no longer have a right to

    such payments. VG

    [23] ROMANIAN CABINET PASSES BILL TO AMEND CRIMINAL CODE

    The

    government has passed a bill designed to bring the country's

    criminal code closer into line with EU norms, according to a

    24 September Rompres report cited by the BBC. Among other

    things, the bill scraps provisions in the current criminal

    code that outlaw homosexual relations. Justice Ministry State

    Secretary Gheorghe Mocuta added that the new bill also makes

    sexual harassment illegal. VG

    [24] HUNGARIAN-ROMANIAN MEMORIAL PLANNED

    Hungarian Justice

    Minister Ibolya David said on 25 September that Bucharest has

    agreed to create a memorial park in the western Romanian city

    of Arad to mark Hungary and Romania's "historical

    reconciliation," Hungarian media reported. The two countries

    will split the cost of setting up the park, which will

    include an obelisk honoring the executed generals of the

    1848-1849 War of Independence. The Hungarian and Romanian

    prime ministers are to lay the foundation stone for the

    obelisk on 6 October. VG

    [25] NEW GOVERNOR OF GAGAUZ-YERI INAUGURATED

    Dumitru Croitoru,

    the newly elected governor of the Gagauz-Yeri Autonomous

    Republic in Moldova, was sworn into office on 24 September,

    Infotag reported. Croitoru took the oath of office in three

    languages--Gagauz, Romanian, and Russian. The new governor

    promised to support market-oriented reforms. Croitoru won 61

    percent of the vote in the 5 September gubernatorial

    elections (see "RFE/RL Newsline," 7 September 1999). VG

    [26] BULGARIA, U.S. AGREE ON MILITARY COOPERATION

    Bulgaria and

    the U.S. are preparing a draft agreement to increase military

    cooperation, Reuters reported on 24 September. Bulgarian

    government spokesman Nikolai Stoyanov said the agreement will

    create a framework for providing U.S. troops with supplies in

    exchange for payment. U.S. officials denied Bulgarian media

    reports that the draft agreement is a plan for the creation

    of U.S. military bases in Bulgaria. Both Bulgarian and U.S.

    officials also denied Russian media reports that they are

    discussing the establishment of a satellite facility for

    spying on Russia. Nevertheless, Bulgarian Prime Minister Ivan

    Kostov on 24 September said his government is studying the

    possibility of setting up NATO bases within the country,

    according to a BTA report cited by the BBC. VG


    [C] END NOTE

    [27] THE LONG SHADOW OF THE SECOND ECONOMY

    by Paul Goble

    Russia's second or shadow economy is now so large and

    pervasive that it is likely to define whatever kind of legal

    economic arrangements do emerge in that country in the

    future.

    That is the unsettling conclusion of a recently

    published study prepared by the Russian Academy of Sciences'

    Institute of Socioeconomic Problems of the Population.

    According to the authors of the study, the earlier

    conviction in both Moscow and the West that "the scale of the

    shadow economy would diminish and the legal economy would

    grow as the country moved in the direction of capitalism" has

    not proved to be true.

    Instead, they suggest, "just the opposite has taken

    place." In 1990-1991, 10-11 percent of the country's GDP was

    produced by the shadow economy, but the illegal or semi-legal

    second economy accounted for 27 percent of GDP in 1993, 46

    percent in 1996, and quite possibly more than 50 percent in

    more recent years.

    Because of the size of this sector of the economy and

    because it is so interwoven with the legal economy, the new

    study argues that the rules of the game within the shadow

    economy are far more likely to define behavior within what

    will emerge as the legal economy rather than be fundamentally

    transformed by that legalization.

    And because this is so, the study suggests, it is

    critical to understand both where the shadow economy came

    from, what the current rules of the game are, and how these

    are likely to play a role as Russia moves to legalize many

    economic activities that are now part of the second economy.

    According to the study, the second economy was

    relatively small during most of the Soviet period. Its

    authors cite a Western study that found that the shadow

    economy produced only 3-4 percent of Soviet GDP in 1973--a

    percentage far smaller, the study notes, than in many

    developed market economies.

    Until nearly the end of the Soviet period, the shadow

    economy performed two fundamental functions: it compensated

    for shortcomings in the functioning of the official legal

    economy, and it provided a field of activity for

    entrepreneurs who could not easily fit into Soviet

    institutions.

    With the collapse of communism, these two functions

    fused, particularly under conditions of what many have

    described as "incomplete" marketization, a system in which

    the role of the state or at least of its agents remained

    large and hence the social space for illegal activities

    actually grew.

    The Moscow study suggests that the shadow economic

    system now has six defining features: close ties between

    bureaucrats and entrepreneurs, continuing interference by the

    state in the economy, preservation of many old monopolies and

    the growth of new ones, high and repressive taxes that are

    easy to avoid, the impoverishment of much of the population,

    and the absence of a legal framework for the economic

    transformations that have occurred.

    The study continues by observing that even though

    "approximately two-thirds of all enterprises are almost

    unaffected by the shadow economy in their activities, those

    firms that are involved are heavily so." Moreover, the

    behavior of these firms casts a long shadow on all the

    others, in many cases because the shadow economy produces

    higher incomes for those who are involved it.

    And the report draws three conclusions: First, until

    legal economic activity produces more wealth than the semi-

    legal or illegal activities of the shadow economy, many

    people will continue to turn to the shadow economy to seek

    their livelihood.

    Second, the percentage of the country's GDP produced by

    the shadow economy will begin to fall only when the country

    enters a long period of stable economy growth, during which

    enterprises will be able to renew their technologies and thus

    generate real wealth on their own.

    And third, even when this change takes place in Russia--

    and the authors are optimistic that it will--many of the

    values and patterns of the shadow economy will help to define

    the values and patterns of the future legalized market

    economy there for many years to come.

    27-09-99


    Reprinted with permission of Radio Free Europe/Radio Liberty
    URL: http://www.rferl.org


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