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Johnson's Russia List


November 19, 1998   
This Date's Issues: 2483 2484 

Johnson's Russia List
19 November 1998

[Note from David Johnson:
1. AP: Census Details Poverty in Russia.
2. Reuters: Russian tax collection tops target levels by October.
3. Reuters: Yeltsin tells PM to fill his shoes again.
4. Moscow Times: Andrei Piontkovsky, SEASON OF DISCONTENT: Rot of Virtual 
Economy and Government.

5. RFE/RL: Ben Partridge, Russia: Crisis Requires New Social Contract,
Says Kiriyenko.

6. The St. Petersburg Times: Brian Whitmore, ANTI-SEMITIC SCOURGE TAINTS 

7. Reuters: Russia cannot afford bloated army -- NATO general.
8. Moscow Times: Christian Lowe, Court Rules To Keep 5% Barrier for

9. Reuters: U.S. team visits major Russian weapon storage site.
10. AmCham News: Bruce Bean, The Toughest Job in the World.
11. Sasha Pugachevsky: Political extremists guide.
12. Edward Lozansky: Invitation to Russia House Friday event in Washington.
13. Syed Mohsin Hashim: Re data base search.
14. AP: Russian Official Laments Economy. (Maslyukov).
15. Interfax: Russia's Natural Resources Estimated At $28.3 Trillion.
16. Interfax: Poll Shows 68% of Russians Back Primakov for Vice President.
17. Interfax: Foreign Investors Flee Russian Banking System.]


Census Details Poverty in Russia
November 18, 1998

WASHINGTON (AP) -- People younger than 64 are more likely to be poor in
Russia than are their older counterparts, the U.S. Census Bureau reported
An analysis of data collected by a Russian statistical agency and analyzed
here also found poverty more likely to affect women, those who failed to
finish high school and the unemployed.
A major factor in Russian poverty is the availability of so-called transfer
income such as disability allowances, pensions, private gifts and other
allowances, the Census Bureau said.
Russian unemployment benefits are often ``quite meager,'' the report said.
In addition, it said pensions, disability benefits and other such stipends are
generally not available to younger workers, resulting in more poverty among
the young than among older people.
In fact, 60 percent of poor households with householders between the ages of
18 and 54 had no such supplemental income.
Education also played a significant role, with people who had the equivalent
of a high school education or less found twice as likely to be poor as someone
with more education. And poverty was higher for women than men.
The analysis was based on data collected by the Russian State Statistical
Bureau, Goskomstat. That survey was done with funding from the U.S. Agency for
International Development, National Institutes of Health, National Science
Foundation and the University of North Carolina.
In its own report, released last month, Goskomstat said that living standards
in Russia are falling even more rapidly than previously believed, with almost
one in three people now living in poverty.
More than 44 million of Russia's 148 million people live below the poverty
line, defined as less than $32 a month, and 8.4 million are without jobs, the
agency said.


Russian tax collection tops target levels by Oct

MOSCOW, Nov 18 (Reuters) - Russian tax collection in the first 10 months of
1998 totalled 134.32 billion roubles ($7.9 billion), topping target levels by
1.27 billion roubles, the State Tax Service said on Wednesday. 
In October the tax service collected 13.8 billion roubles, 142 percent of
forecast revenues, a statement by the service said. Tax collection for the
three previous months amounted to 33.3 billion roubles. 
Tax Service Head Georgy Boos said earlier that cash receipts to the budget in
October increased to 12.20 billion from 6.53 billion in September. 
The service said value added tax accounted for 48 percent of receipts, excise
duties 23 percent, and profit tax 20 percent. 
But rouble devaluation, which has seen the currency slide from about 6.5 per
dollar just before an effective devaluation on August 17 to 16.98 on
Wednesday, has slashed the dollar value of Russia's tax receipts. 
However, Boos has played down the effect of the devaluation and accompanying
inflation, saying their effect on tax revenues would only be felt in January
or February 1999. 
Consumer price inflation in the first 10 days of November was 0.9 percent
month-on-month after 4.5 percent in October and 38.4 percent in September. 
The International Monetary Fund, which is considering further aid to Russia
from a frozen loan facility, has repeatedly criticised the government for its
poor tax record. 
($=16.99 roubles) 


Yeltsin tells PM to fill his shoes again
By Adam Tanner

MOSCOW, Nov 18 (Reuters) - President Boris Yeltsin took another step back from
active politics on Wednesday when the Kremlin announced he had asked his prime
minister to make an official visit to India he had earlier planned in
Prime Minister Yevgeny Primakov, more than a year older than the 67-year-old
Yeltsin, has taken a growing role in both economic and foreign policy since
taking office in September. 
On Wednesday, Primakov completed another task standing in for Yeltsin at the
two-day Asia-Pacific economic forum in Malaysia, during which he outlined to
U.S. Vice President Al Gore his plans to pull Russia out of its severe
economic crisis. 
Yeltsin had been due to go to New Delhi himself. 
Chief Kremlin's spokesman Dmitry Yakushkin, quoted by Interfax news agency,
said Yeltsin did ``not always feel well.'' ``But he works a lot every day, he
is aware of all events and he is constantly making decisions,'' the spokesman
Officials have refused to confirm publicly that Yeltsin would not now be going
to India and Yakushkin only vaguely admitted that doctors were against
Yeltsin's trip to India. 
``It would be wrong to say that doctors are delighted with the prospects of
the president flying to India. I don't think they would approve of the
visit,'' he said. 
Yeltsin has met German Chancellor Gerhard Schroeder and Japanese Prime
Minister Keizo Obuchi over the past week in the Kremlin, but he looked tired
and hesitant in both appearances. Japanese officials said he looked ``like a
Yeltsin did on Wednesday instruct his advisory Security Council to meet to
discuss a threat by the leader of an ethnic region in southern Russia to
loosen ties with Moscow. 
President Kirsan Ilyumzhinov, flamboyant millionaire and leader of the poor,
traditionally Buddhist Republic of Kalmykia, said he might seek ``associate
membership'' of the Russian Federation and withhold taxes due to a lack of
federal funding. 
The Security Council said in a statement it would meet soon and make
recommendations to Yeltsin on measures ``to ensure the unconditional
observation of the constitution.'' 
``The president takes the Kalmyk leader's comments absolutely seriously,''
Yakushkin said in separate comments. ``The president believes such statements
create an extremely unwelcome atmosphere for political stability in Russia.'' 
Ilyumzhinov appeared to back off in a new television interview on Wednesday,
saying his republic did not actually plan to quit Russia and that his threats
had been designed to attract the Kremlin's attention to his poor region's
As the Kremlin fretted about the potential dangers of separatism, a mission
from the International Monetary Fund (IMF) got down to work in Moscow. 
The government had been seeking approval of anti-crisis measures and new
credits to ease an acute cash crunch. The previous IMF team left Russia at the
end of October without releasing delayed funds for Russia. 
Despite a chronic lack of cash, Russia was likely to extend the life of its
12-year-old Mir space station until mid-2000, a year later than expected, a
source close to the Kremlin said on Wednesday. 
The decision may irritate the United States, as Moscow had previously pledged
to bring down Mir in June 1999 and focus its limited financial resources on
the new International Space Station, the first element of which is to be
launched on Friday. 


Moscow Times
November 19, 1998 
SEASON OF DISCONTENT: Rot of Virtual Economy and Government 
By Andrei Piontkovsky 

In a recent communication about the mass media sent to Prime Minister Yevgeny
Primakov, the leaders of the left wing lavish servile praise on his government
for its "decisive break with the ruinous, anti-national monetarist course the
IMF forced on the country." 
Even Primakov himself appears to have been taken in by this. Addressing the
top military brass the following day, he spoke of the destructiveness of the
course conducted in the last few years, and of the "bankruptcy of
microstabilization policy and collapse of the real economy." 
The changing government course is also a hobby horse of the government's
liberal critics, who refer bitterly to a Communist revanche, the end of
liberal reforms and a return to a socialist economy. 
Indeed, the only real distinction between Primakov's government and that of
all his predecessors in the past 10 years, starting with the Soviet government
of Nikolai Ryzhkov, is the rhetoric they use. In reality, they have all stood
helplessly to one side as the "Virtual Economy" inherited from the Soviet
Union continues to fall to pieces, and while its last serviceable components
are looted. 
It was not as a result of some "Judeo-Masonic conspiracy" that the Communist
regime and the Soviet Union collapsed, nor because "that traitor Mikhail
Gorbachev" made it to the top of the power hierarchy. Their collapse came
about due to a number of objective reasons, not least of all because of the
utterly ineffective structure of the Soviet economy that emerged up to the
1980s, a structure in which most enterprises presumably produced goods but
actually destroyed value. 
These enterprises have survived years of reform and, regardless of whatever
reformist rhetoric was spouted, not one government has dared to tackle this
crucial problem. Moreover, things have been made worse by the transfer of
control of these inefficient enterprises, as well as a number of successful
and viable ones, to the red directors that formerly ran them. The problem of
an inefficient economy was compounded by that of inefficient owners, the
typical red director being not the slightest bit interested in the well-being
of his enterprise. His priority is not profit but cash flows that can be
channeled into his private bank accounts. 
This large group of economic parasites was created under Ryzhkov's government,
leaving all subsequent governments to face the insoluble task of increasing
the tax revenues from an ever-shrinking area of real economy. Now not even the
traditional export of raw materials can save the state budget. The bandit
capitalism that evolved in Ryzhkov's time was developed perfected by Anatoly
Chubais, who distributed raw material-producing companies for a song among his
And regardless of its ideological preferences and intentions, Primakov's
government is also doomed to prolong the existence of this "System of Virtual
Economy." Which it is doing. In practice, the slogan of supporting domestic
production means further budget subsidies for ineffective enterprises and
inefficient owners, while all the talk about increasing the role of the
government in the economy has amounted to little more than new tax breaks for
oil oligarchs and the gas monopoly Gazprom. 
In real terms, the only thing that has increased is statist rhetoric. Just as
General Charles de Gaulle liked to refer to the grandeur de France, Yevgeny
Primakov likes to talk of the velichiye Rossii. But the general never
requested humanitarian aid. 


Russia: Crisis Requires New Social Contract, Says Kiriyenko
By Ben Partridge

London, 18 November 1998 (RFE/RL) -- Former Russian Prime Minister Sergei
Kiriyenko says a new social contract between government and people could
provide a way out of the country's economic crisis. 
Kiriyenko, who served as prime minister for five months until his cabinet was
sacked by President Boris Yeltsin in August, spoke yesterday at the Royal
Institute of International Affairs in London. 
Kiriyenko says abortive reforms over seven years since the collapse of
communism have led to a loss of public trust in Russia's political elite. 
He cited a TV poll which found that 17 percent regarded the government as the
"main enemy of the people", compared with 15 percent who named criminal
circles and 16 percent business circles. 
He said the poll illustrated the complete estrangement of society from
government, reflecting the "fatigue of expectations" caused by prolonged
delays in securing genuine economic reforms. 
He said the power elites and society need a new social contract that would
likely fall into one of three possible scenarios. 
The first scenario would require an open declaration of an honest and rational
economic program that would be painful but, given the severity of the present
crisis, would be accepted by the nation. 
A second scenario would involve a populist program modeled on what President
Carlos Menem introduced in Argentina. Kiriyenko said there was a third
possible scenario: a Chile-style dictatorship. 
Kiriyenko said the evidence suggests there is popular support for the first
option --a rational economic program that would likely secure the backing of
Russia's newly-emerged middle class. 
Citing the importance of an assertive middle class, Kiriyenko said a recent
poll showed that 61 percent of Russians wanted to be self-reliant and were not
seeking paternalistic government help. 
This was a 20 percent increase over a similar poll conducted only last year
and, according to Kiriyenko, represented a "colossal" 28 million Russians
whose attitude had changed in 18 months. 
Kiriyenko cited this public support for self-reliance to defend his claim that
seven years of largely abortive reform had not been in vain. He said there is
now a general realization that a social consensus in the nation cannot be
provided for "without a market economy because the mentality of the nation has
Kiriyenko said professional managers who so far have not been admitted to the
power structure constitute a new political force. 
And he said the younger generation who now account for 28 percent of the
electorate are "a gigantic resource" who will radically change the pattern of
political preferences in future elections. 
He said a sign of the greater savvy of Russians came in a poll which found 48
percent said the government should not print money to get out of the present
crisis, a result "impossible a few years ago". 
Kiriyenko says one of Russia's main problems is that it is one of the least
developed of industrial nations but at the same time it has a budgetary load
that is equal to that of the United States. 
He said Moscow faces a basic need to reduce state spending while at the same
time introducing an efficient tax collecting system. He said the present
burden of social spending, at 16 to 19 percent of gross domestic product,
cannot possibly be sustained. 
Kiriyenko said the main problem in Russia is not the economy -- because its
weaknesses are soluble -- but the ineffectiveness of the power structure,
reflecting the difficult transition from socialism. Kiriyenko paid tribute to
the man who replaced him as prime minister, Yevgeni Primakov, for providing
what he called "a great service to the nation in providing political
stability." But he said the government faces critical decisions on December 1
when a draft budget is due, presenting it with hard political decisions. 


The St. Petersburg Times
Nov. 17, 1998
By Brian Whitmore

The ugliest campaign season in recent memory just keeps getting uglier. 
This year's Legislative Assembly election campaign, which has already
witnessed an unprecedented array of dirty tricks and political
shenanigans, is now being tainted with an ugly ominous wave of
anti-Semitic propaganda attacks.
In some districts, campaign posters of Jewish candidates have been
defaced with racial epithets while in others, leaflets have been
distributed asking voters not to vote for Jewish candidates. Campaign
workers for several candidates have also reported receiving anonymous
anti-Semitic telephone calls. Openly anti-Semitic articles have even
appeared in the local press, and some candidates have gone so far as
making explicitly racist appeals in their television advertising.
"These acts appear to have been planned and coordinated," said poet and
assembly candidate Viktor Krivulin. 
The author of some 12 books of poetry and a close friend to the late
Nobel laureate Joseph Brodsky, Krivulin is one of the targets of the
recent anti-Semitic campaign. Vandals drew Stars of David and wrote the
word "***zhid***" Ñ a racial slur for Jewish people Ñ on Krivulin's
campaign posters in the 2nd electoral district on Vasilyevsky Island,
where he is running for an assembly seat. Also, across the street from
Krivulin's campaign headquarters on Ulitsa Korablestroitiley, graffiti
was spray-painted on a wall reading: "Beat the Jews. Save Russia."
In the 41st electoral district on the Petrograd Side, leaflets have been
circulated imploring voters to vote against Jewish candidates.
"Even without glasses it is easy to see that Jews are using tricks and
provocations to take over Russia," the leaflet read. "They slide into
power and aspire to occupy the warm place of a lawmaker. They must not
In an article published on Oct. 29 in the weekly newspaper Novy
Peterburg, Yury Shutov, a candidate in the 9th electoral district, wrote
a thinly veiled anti-Semitic treatise that complained of non-Russian
influence in the arts and the media.
"The world-famous library of Russian literature is now filled with names
that sound like Iceberg, Kronshtein and Shlagbaum," Shutov wrote.
Yury Kravtsov, the assembly's ex-speaker who is running for re-election
in the 9th district, called the wave of anti-Semitism in the election
campaign "indecent."
"Unfortunately, anti-Semitism has always been used by some people in
times of social and economic crisis," said Kravtsov.
And targets of anti-Semitic attacks are not always necessarily of Jewish
For example, both incumbent lawmaker Oleg Sergeyev, who represents the
50th electoral district in Kupchino, and renowned artist Dmitry Shagin,
who is running for a seat in the 20th district in the suburb of Pushkin,
have reported anti-Semitic telephone calls to their staffs. Neither is
Jewish. Alexander Belyayev, a prominent liberal who served as speaker of
the old City Soviet and who is running in the 41st district, was among
those targeted by anti-Semitic leaflets distributed there.
"I am honored to be called a Jew," said Belyayev, who is not Jewish. "I
am certain that this agitation will backfire on those who organized it."
The alarming trend is a reflection of a recent nationwide uproar over
remarks made by Albert Makashov, a Communist State Duma Deputy, who has
publicly blamed Jews for Russia's economic crisis and called for them to
imprisoned en masse. 
Despite passing a tepid resolution against racism, the Duma has
repeatedly refused to censure Makashov, who has continued to make
anti-Semitic statements in public and who has the tacit support of
Communist Party head Gennady Zyuganov, whose party dominates the
nation's lower house of parliament. 
In the Legislative Assembly last Wednesday, 14 legislators Ñ members of
the Civic and Centrist factions, the local branch of Yabloko and
independent lawmaker Alexander Shchelkanov Ñ signed on to an
announcement condemning Makashov.
Leonid Kesselman, of the Russian Academy of Sciences Institute of
Sociology, said anti-Semitic epithets are often used by communists and
nationalists to insult liberals and democrats Ñ regardless of their
national origins.
Krivulin agreed, saying: "This is one of the instruments the communists
are using to try to dominate society. In their view, ***Zhid*** is a
synonym for democrats." 
Kesselman said that anti-Semitism is less prevalent in St. Petersburg
than in Russia as a whole. 
"Anti-Semitism is associated with anti-Westernism and since St.
Petersburg is a very Western-oriented city it is less common here. Such
attitudes are also most prevalent among people with a low level of
education, and St. Petersburg is one of the best-educated cities in
Russia," said Kesselman. "In St. Petersburg, anti-Semitic attacks tend
to help the candidates they are used against."
Last week, Dmitry Likhachev, the prominent Russian literary historian,
also spoke out forcefully against anti-Semitism.
"Attempts to find those guilty of one's own stupidity and inability to
work has always been typical of unworthy and indecent people," said
Likhachev. "Hundreds of Jewish scientists and scholars are considered to
be the pride of Russian history."
Inciting racial hatred is a crime according to the Russian Criminal
Code, and Electoral Commission officials said that candidates who use
openly racist campaign tactics could find themselves disqualified from
the election.
"Any anti-Semitic or otherwise racist propaganda is a violation of the
law and if we receive any complaints about this we will immediately look
into them," said Alexander Garusov, chairman of the city electoral
One such case could turn out to be Denis Usov, who is running in the
50th district in Kupchina. Last month, Usov, using the air time allotted
to all candidates, made disparaging remarks about ethnic minorities Ñ
specifically people from the Caucuses. The local branch of the political
party Democratic Russia filed a complaint with the Electoral Commission,
who has informed the Prosecutor General's Office to investigate.


Russia cannot afford bloated army -- NATO general
By David Brough

LISBON, Nov 18 (Reuters) - A senior NATO official said on Wednesday Russia
must learn it cannot afford its bloated military and does not need it. 
General Klaus Naumann, the German chairman of NATO's military committee, told
a security conference in Lisbon that Russia would remain unstable for some
time but it was vital to continue military cooperation with it. 
``We have to tell them (Russia) that they simply cannot afford the still
inflated military and we need to convince them that they no longer need it,''
he said. 
``As a consequence, NATO needs to fully engage in dialogue and cooperation
with this great nation and the military should be allowed to spearhead such a
politically controlled effort.'' 
Naumann said NATO aimed to achieve security with Russia and not against it, as
in the Cold War. 
He said: ``One cannot view Russia soberly without coming to the conclusion
that this great nation is and will be in a state of considerable instability
for some time to come.'' 
The general said it was impossible to predict the outcome of Russia's
transformation and he believed it had not done enough to reform its political
and economic systems. 
``We welcome the fact that this enormous country has tried to embrace the
democratic and free market economic models since the break up of the Soviet
Union,'' Naumann said. 
``But the scale of the challenge sometimes appears overwhelming for a nation
whose social conscience never adopted such ideals in its history and so far
Russia has certainly not taken the necessary steps down the road of true
He said: ``We must not hesitate to tell our Russian partners in clear words
where they stand and what is wrong.'' 
Naumann added: ``To continue to belittle the lack of reform, to offer money
without asking for reform in return and to make the Russians believe they
still had the influence of a superpower is not the right way to treat them as
a true partner.'' 


Moscow Times
November 19, 1998 
Court Rules To Keep 5% Barrier for Parliament 
By Christian Lowe
Staff Writer

Russia's Constitutional Court has ruled that a controversial regulation that
effectively prevents smaller parties from being represented in the State Duma
should be kept. 
The court decided Tuesday that the electoral law that requires parties running
for the Duma, parliament's lower house, to poll a minimum of 5 percent of the
vote to qualify for any seats "cannot be seen as inordinate." 
The regulation has been maligned by representatives of Russia's numerous small
parties, who claim it deprives many voters of their constitutional right to be
represented in parliament. At the last Duma elections, 49.5 percent of votes
were given to parties that failed to overcome the 5 percent barrier. 
Half of the 450 Duma deputies are directly elected by voters in their local
districts. The disputed law concerns the remaining 225 seats, which are handed
out to parties in proportion to the percentage of the nationwide vote they
mustered in the election. 
The 5 percent barrier is seen as working against Russia's liberal parties,
which are notoriously unwilling to unite into large blocs, and playing into
the hands of the better-organized Communists and nationalists. 
Ella Pamfilova, a former social affairs minister whose bloc failed to get over
the 5 percent barrier in the 1995 Duma elections, expressed disappointment at
the Constitutional Court's decision. 
"This is the position of those parties that got into the Duma," she said
Wednesday. "They have decided to get a monopoly on power." 
More than a million people voted for her Pamfilova-Gurov-Vladimir Lysenko bloc
in 1995, "which means a major part of the electorate are left without their
representatives in the Duma," she said. 
Sergei Yushenkov, a Duma deputy and member of the Russia's Democratic Choice
party, was more sanguine. His party failed to break the 5 percent barrier in
1995, leaving its leader, former Prime Minister Yegor Gaidar, embarrassingly
without a seat in the lower house. It is only represented in the lower house
by deputies who were directly elected from constituencies. 
But Yushenkov said he was confident liberal parties had learned their lesson
from the last election. "I hope that in three to four months in Russia the
idea of the necessity of unity will become dominant," he said. "All the
disagreements, which are mostly based on personality differences, will be
thrown aside and we will form a sort of union of Russian democratic forces." 
In a concession to critics of the electoral system, the Constitutional Court
ruled that if fewer than two parties qualify for seats, or if those parties
that qualified mustered less than 50 percent of the total vote between them,
the elections should be declared void. 
Vladimir Pribylovsky, president of the Panorama think tank, said, however,
that the legislation setting out this new rule may not be ready by the next
parliamentary elections in December 1999. And with smaller parties uniting,
fewer are expected to fall beneath the 5 percent barrier, making it unlikely
that parties in the Duma would hold less than 50 percent of the vote,
Pribylovsky said. 
In the last Duma election, only four blocs - the Communist Party, Yabloko, Our
Home Is Russia and Vladimir Zhirinovsky's Liberal Democratic Party - qualified
for seats, although candidates elected directly from constituencies formed
other groups after the election. 


U.S. team visits major Russian weapon storage site
By Martin Nesirky

OZYORSK, Russia, Nov 18 (Reuters) - Senior U.S. officials on Wednesday got
their first look at a vast storage site being built with American help to stop
6,000 bombs' worth of Russian radioactive material falling into the wrong
Senators Richard Lugar and Carl Levin and a dozen other officials flew from
Moscow to President Boris Yeltsin's Urals home region and drove 140 km (90
miles) through snowclad forests to the high-security Mayak Fissile Material
Storage Facility, which will be ready to receive the first plutonium and
weapons-grade uranium in 2002. 
``This is the only site of its kind,'' Russian deputy chief engineer Vladimir
Savvateyev said as the senators examined the cavernous, freezing hall. 
When full, the storage depot will hold 25,000 containers in house-high steel
tube ``nests'' encased in concrete inside a building the size of an aircraft
hangar. There will eventually be a second depot alongside. The atomic material
will be delivered by rail and the aim is to store it indefinitely. 
``The Mayak facility is extremely important to Russia and the United States,''
Lugar, an Indiana Republican, told Reuters. 
Lugar, who set up the Nunn-Lugar Cooperative Threat Reduction Programme in
1991 along with now-retired Senator Sam Nunn, said the United States had
helped Russia dismantle warheads and remove nuclear material from those
``Finally that material has to be placed somewhere securely. The Mayak
facility has that security,'' he said. ``Our Department of Energy and
Department of Defence have worked with officials here to bring that security.
We have observed it physically today and we are impressed.'' 
A Defence Department official said Congress had so far provided $222 million
for the project and was likely to top that up when necessary. 
``We believe that it is money well spent,'' said Lugar. 
Levin, a Michigan Democrat, agreed, saying the scheme and other projects to
deal with Russian biological and chemical weapons should not be seen as a
simple hand-out. 
``These are not gifts to the Russians,'' he said. ``These are gifts to
ourselves and to the world.'' 
He said it took only a lump of plutonium the size of a can of soda to make a
bomb and a terrorist could easily cross a border with such an amount. 
``We can tell our colleagues and constitutents that we've seen the place where
6,000 bombs' worth of plutonium will be safely stored,'' Levin told Reuters
after a tour of the site and a briefing by Russian officials in nearby
Ozyorsk, where plutonium for the first Soviet bomb was produced in 1949. 
``The world's a heck of a lot safer against the terrorist threat with this
investment,'' he said. 
There have been reports in the West that weapons-grade nuclear material has
gone missing from the Mayak group of reactor and reprocessing sites in
Ozyorsk, a long-secret town of 86,000 people surrounded by a double wire
fence. But Mayak spokesman Yevgeny Ryzhkov denied this. 
``We pay great attention to security. There have been no cases of fissile
material being lost or stolen,'' he said. 
Security could always be improved, he added, and this was being done as part
of link-up with the United States. 
``It's essential that we have scientists who have talent and information
working on peaceful projects instead of being tempted by desperation to go to
Iran or Libya or Iraq,'' Levin said. 
Ryzhkov said Mayak employees earned on average $100 a month and, unlike
elsewhere in Russia, were mostly paid on time. He said to his knowledge no key
scientists had moved abroad. 


Date: Wed, 18 Nov 1998
From: (Bruce Bean)
Subject: Chairman's Letter--American Chamber of Commerce in Russia

Please consider the attached for your marvelous list. It is my Chairman's
Letter from today's issue of AmCham News, the publication of The American
Chamber of Commerce in Russia
Best regards.
Bruce W. Bean,
Partner Clifford Chance - Moscow

The Toughest Job in the World
By Bruce Bean

Americans are used to hearing that the President of the United States has
the toughest job in the world. These days I believe the “toughest job”
title may well belong to Russia’s Prime Minister Yevgeny Primakov. Not only
is President Yeltsin ill at the moment, thus necessitating the Prime
Minister’s attendance at the Vienna European Union Heads of State meeting at
the end of October, but Mr. Primakov has also assumed responsibility for
creating a viable market economy out of the very tough economic and
political conditions found in Russia today.

Since the events of 17 August, food and other imports have been severely
reduced. Inflation has reportedly reached 50 to 60%. Employment in
financial services, advertising, retailing and restaurant businesses has
been drastically reduced. In addition, Mr. Primakov must deal with a
stricken commercial banking system, cope with tragically low world prices
for one of Russia’s primary exports - oil - and respond to claims for
payments due on billions in ruble-based government debt.
To make this job even less attractive, Russia’s tax collections remain
anaemic, Russia faces external debt of $150 billion and has billions in
domestic wage, pension and other arrears. The demise of “banking” as
Russia knew it also adds billions in unpaid obligations due to bank
depositors and counterparties in forward currency transactions.
Do you know anyone who wants this job?
Notwithstanding these extremely unfavorable conditions, Mr. Primakov has
accepted his responsibility and has set about work in a necessarily
deliberate manner, given current political realities. But being 68 years
old, Mr. Primakov has a past. And in the Western press some editors still
need crises and enemies to sell their wares. Thus we have a prominent
American newsmagazine last month featuring on its cover a glorious red
hammer and sickle and the statement -

“A creeping coup, …the Communists are back.”
In the story we are told not only that are the commies back but also the
Prime Minister Yevgeny Primakov is “a former KGB agent.” Whatever Mr.
Primakov’s prior responsibilities, they were very likely more comparable to
Henry Kissinger’s than anything Ian Fleming conjured up or Sean Connery
portrayed so convincingly for Hollywood.

I agree with Mayor Luzhkov, who last month in London declared that Mr.
Primakov’s government has to be judged by its results, not the past
affiliations of its ‘rainbow coalition” of members. To date we have seen
few results. From the numerous Delphic trial balloons launched in the past
weeks, however, it appears the Prime Minister, some of his cabinet and many
in the Duma have concluded that one part of a solution for Russia today
involves encouraging foreign direct investment. While the IMF’s love-child
- liquid capital markets which can absorb massive amounts of debt and equity
investments from professional portfolio managers - are necessary for a fully
functioning market economy, we have certainly learned since 17 August that
they are not sufficient.

As valuable as portfolio investments are, it is direct investment that
brings productive jobs in the “real” economy, where wages are actually paid
on time and taxes are properly recorded and remitted. In addition, direct
investors are here to stay. They will by and large use this break in
Russia’s recent progress to attempt to consolidate their positions and
increase their market share. They will do all possible to avoid leaving Russia.
What is it that Mr. Primakov must ask the Duma to do to encourage foreign
direct investment? The following are two important points that any foreign
investor would hope to be able to secure in an Investment Agreement with the
The Government hereby guarantees that the property invested in the
company will not be subjected to nationalization, confiscation or requisition.
The Government guarantees the inadmissibility of unilateral changes by
the Government to the conditions of the Investment Agreement.
This language is a direct translation, not from an AmCham White Paper,
but from an early Twentieth Century political philosopher whose name you
will recognize …V. I. Lenin. These principles are taken directly from
Decree 481, dated 25 November 1920. I am indebted to Dr. Anatoly
Korobeinikov and Prof. Mikhail Sidorov of the Analytical Department of the
State Duma for pointing out that it was Lenin himself who first understood
what was needed to attract foreign investment here.
Perhaps if the Duma is reminded that it was Lenin who originated the idea
of guaranteeing foreign investors tax and administrative stability, it will
more easily agree on acceptable versions of the Foreign Investment Law and
the Omnibus Enabling Law for the Production Sharing Law. These laws, plus a
possible revival of the concession concept embodied in Decree 481, could
help Russia can begin to enjoy the benefits of massive amounts of foreign
direct investment.

The direct investors already in Russia plan to stay, if at all possible.
Among the things Russia needs today are real jobs in industries with a
future. Massive amounts of additional direct investment can bring these.
Direct investment will generate the economic activity and tax paying jobs
that are needed to build Russia’s Twenty-First Century economy.
This year has already been more eventful than any AmCham member could
have wished. For now Russia remains what one wit has called: a minefield of
opportunity. Nevertheless, we all remain in awe of the resilience of the
Russian people. If Hitler could not destroy the USSR, the current financial
crisis will not destroy Russia.


From: (Sasha Pugachevsky)
Subject: political extremists guide
Date: Wed, 18 Nov 1998 

I am currently in touch with PANORAMA, a Moscow-based agency that 
specializes in sociological studies. The group publishes a comprehensive 
database of Russian political figures, parties, publications that some of 
you may be familiar with. In addition, they published a book called 
"Natsional-Patriotichesliye Organizatsii v Rossii" that covers history, 
ideology and extremist tendencies of such parties in Russia. The book 
was published in 1996 in Russian and just recently made its way to the 
United States (i found a copy at the University of Pennsylvania library 
this month). 
What I (along with the author Aleksandr Verkhovskiy) was wondering is 
whether there is a demand for a translation of this book into English. 
To my knowledge this is the most comprehensive study of the movement in 
Russia to date, especially in light of MAkashov and recent discussions 
on this list. It covers everything, from a short overview of extremism 
during the Communist years to profiles and interviews with some of the 
If any of you can assess possible demand for this translation, please let 
me know. I am also interested in what companies may consider publishing 
this. Any help or advice will be appreciated,


Date: Wed, 18 Nov 1998
From: (Edward Lozansky)
Subject: Invitation to Russia House Friday event

Russia House 
cordially invites you to the Every Friday After Work Relaxation
at Russia House Club and Restaurant where you can meet interesting 
people; discuss business opportunities, politics, culture;
make usefull connections; enjoy music, variety of drinks and Russian 
hors d'oeurs.
Bar is open every Friday from 7:00 PM till Midnight.
Cover charge : $ 5.00
For more information, please contact us at : 1800 Connecticut Ave, NW
Wasington, DC 20009
tel: 202.986.6010
fax: 202.667.4244
http: //


Date: Wed, 18 Nov 1998 1
From: Syed Mohsin Hashim <>
Subject: Re: data base search

I would greatly appreciate any information that would help me gain access
to any of the following Russian politics databases. I need them for my
disseration research. The databases I am looking for are: 1. "Part-Archiv"
(by In-Dem, Moscow) and 
2. Labyrinth (by Panorama, Moscow) 


Russian Official Laments Economy
November 18, 1998

MOSCOW (AP) -- Russia may be headed toward disintegration and an end of
democracy if the deepening economic crisis is not resolved, a top Cabinet
official warned in an interview published Wednesday.
The government says that to keep the economy from crumbling, it needs to
reschedule Russia's huge foreign debt payments and receive foreign aid that
was frozen months ago. But international creditors have not given any sign
that they will grant either request.
If the government fails to stabilize the economic situation, ``we will be
facing a national catastrophe that would write off the free-market economy,
democracy and the territorial integrity of Russia,'' Deputy Prime Minister
Yuri Maslyukov said.
He warned that inflation would spiral out of control next year unless the
government reaches an agreement with its creditors to reschedule some of the
$17 billion in foreign debt payments due in 1999.
``If we succeed in restructuring just half of this amount, we will manage to
keep the impact on inflation and industrial output within reasonable limits,''
he said in an interview with the business daily Kommersant.
Russia's impoverished regions, frustrated at mounting debts owed by the
federal government, are already defying Moscow.
The president of the impoverished southern republic of Kalmykia, Kirsan
Ilyumzhinov, said Wednesday he would push for secession because of the federal
government's failure to deliver subsidies to the region.
Ignoring federal government orders, Gov. Alexander Lebed of the vast Siberian
region of Krasnoyarsk blocked shipments of nuclear waste into his region and
demanded pre-payment in hard currency for future consignments.
Russia is facing its worst economic crisis since the Soviet collapse. Over the
past month, the number of Russians living below the official poverty line
reached 42 million, or 29 percent of the population, compared to 31 million,
or 21 percent, a year ago, the State Statistics Committee said.
The official poverty line is about $40 a month per person.
The government is pushing the International Monetary Fund for more money,
saying it is vital to paying off the huge domestic and foreign debts.
An IMF team was back in Moscow on Wednesday for talks on the possibility of
releasing the next installment of a $22.6 billion aid package, frozen in after
Russia devalued the ruble and defaulted on some debts in August.
The visiting IMF officials said they expected little from the current round of
Despite IMF warnings, Russia has also started printing money to help its
ailing banks and pay some debts, which many analysts warn will trigger
Finance Minister Mikhail Zadornov said Wednesday that Russia has printed 8
billion rubles worth about $470 million since Oct. 1, the Interfax news agency


Russia's Natural Resources Estimated At $28.3 Trillion 

ST. PETERSBURG, Nov 17 (Interfax) -- The combined prospected natural
resources of Russia are estimated at $28.3 trillion, Minister for Natural
Resources Viktor Orlov said Tuesday at the opening of an international
conference in St. Petersburg titled "Resources of CIS Countries."
He said that the extraction of reserves worth only $1.5 trillion is
profitable, given the current standard of equipment and technology.
In extraction Russia significantly lags behind industrialized
countries, which are responsible for over 50% of the world's production,
Orlov said natural resources will remain the foundation of the Russian
economy in the near future. However, in order to achieve a higher
extracting standard geological prospecting must be expanded, new
technologies introduced and foreign investments attracted on a larger scale
in the prospecting of new deposits.
The most promising new technologies are ones that reduce the
consumption of energy and materials in production, Orlov said. He said he
favored a greater degree of processing minerals and other resources,
extraction of resources from sea depths of over 4 kilometers and
development of the tanker fleet.


Poll Shows 68% of Russians Back Primakov for Vice President 

Moscow, Nov 17 (Interfax) -- Over two thirds of Russian citizens (68%)
welcome the idea of empowering Prime Minister Yevgeniy Primakov to perform
the duties of vice president; 14% oppose this idea and 18% are undecided,
according to a poll held by the Public Opinion Foundation on November 7 and8.
The poll involved 1,500 respondents in 56 populated areas in 29
regions, territories and republics in all of Russia's economic-
geographic zones.
The respondents were also asked to say who of the known politicians
might unite different political forces.
Primakov was again named by most of those polled (30%).
Twenty one percent named Moscow Mayor Yuriy Lyuzhkov, 19% Communist
Party leader Gennadiy Zyuganov, 13% Governor of Krasnoyarsk territory
Aleksandr Lebed, 9% Yabloko leader Grigoriy Yavlinskiy, 5% Belarusian
President Alyaksandr Lukashenka and 4% leader of the Liberal-Democratic
Party Vladimir Zhirinovskiy.
Another 7% of the respondents named other politicians. But 30% of
those polled said there was no such politician in Russia.


Foreign Investors Flee Russian Banking System 

MOSCOW, Nov 13 (Interfax-FIA) -- Foreign investors are shedding their
equity stakes in Russian banks.
Nonresidents' share of the combined charter capital of Russia's banks
had fallen to 4.11% by October 1, about where it was at the beginning of
1998, from 4.28% on July 1, the Central Bank said in its newsletter. 
Russian banks' charter capital, meanwhile, grew by 6% to 58.03 billion
rubles in October from 54.45 billion rubles in July.
Moscow banks accounted for 95.6% of foreign equity investment in
Russian banks, St. Petersburg took another 2.66%, and all the other regions
of the country received less than 0.5%.
A total of 86 Russian banks with foreign investors (60.1%) have
investors from outside the CIS, 35 (24.5%) have investors from the CIS, and
22 (15.4%) have investors from both outside and within the CIS.


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