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Johnson's Russia List


November 21, 1998   
This Date's Issues: 2486 •• 

Johnson's Russia List
21 November 1998

[Note from David Johnson:
1. Reuters: Liberal's murder rings Russian alarm bells.
(Galina Starovoitova).

2. AP: Russia Doesn't Approve Budget.
3. The Economist: A cold, hungry, pointless Russian army.
4. International Herald Tribune: Jim Hoagland, An American Military 
Priority: Feed the Russian Army.

5. Reuters: New agency to tackle Russia's sick banking system.
6. Boston Globe: Jean MacKenzie, Running for daylight. Amid financial 
ruins, one Russian bank strives to grow.

7. Fred Weir on Yeltsin's trips.
8. Moscow Tribune: Lyuba Pronina, Russians Queue in Snow for U.S. 

9. The Guardian: James Meek, Primakov savages Russia's reformers.
10. Moscow Times: Igor Zahkarov, BOOKWORM: Bringing Top Titles To 
Foreign Publishers.

11. Itar-Tass: Communists Likely To Lose Impeachment Game.
12. AP: U.S. Consul Charged in Car Accident.
13. Moscow Times: Yeltsin Denies TV Share Trade.]


Liberal's murder rings Russian alarm bells
By Oleg Shchedrov

MOSCOW, Nov 21 (Reuters) - Russia's feuding political parties ranging from
liberals to communists sounded equally alarmed on Saturday by the murder of a
prominent lawmaker, saying it was a dangerous sign ahead of the next
Police do not know who killed liberal Galina Starovoitova and badly wounded
her aide in Russia's second city St Petersburg late on Friday and are
investigating several possible motives. 
But both allies and foes of Starovoitova, a long-time leader of the Democratic
Choice of Russia (DVR) movement and a member of the State Duma lower house of
parliament, have already branded the murder as ``political.'' 
``The murder of such a bright personality who was a Duma deputy and an
outstanding politician should be viewed as political by definition,'' the
deputy head of President Boris Yeltsin's staff, Oleg Sysuyev, told Ekho Moskvy
The killing comes at a time of growing political uncertainty as Yeltsin,
dogged by illness and weakened by Russia's economic crisis, withdraws from
active political life. 
Russia's next parliamentary election is due in December 1999 and the
presidential poll in July 2000, but many political forces suspect they may
come sooner and have effectively begun their electoral campaign. 
A series of recent scandals, including charges by prominent businessman Boris
Berezovsky that elements in the security services planned to kill him, and an
unexpected legal action against the main public television network ORT, have
fuelled fears that political tensions could spin out of control. 
Starovoitova had been visiting St Petersburg to help her movement's campaign
ahead of an election for the local legislature scheduled for December 6. 
``There is a feeling someone is clearing space ahead of the St Petersburg
polls,'' RIA news agency quoted a senior Duma deputy from the ultra-
nationalist party of Vladimir Zhirinovsky as saying. 
``I am sure this should be investigated thoroughly because otherwise the 1999
election may turn into something horrible,'' Alexei Mitrofanov told RIA. 
The political atmosphere has been further clouded by recent anti-Semitic
remarks made by radical Communist Albert Makashov, who called for Jews to be
rounded up and jailed, and by the Duma's subsequent failure to censure him. 
``I think these events are all links in one chain,'' liberal deputy Ella
Panfilova told Ekho Moskvy. ``This shows that in our society the process of
intolerance to each other is developing. I think we are on the brink.'' 
Sergei Yushenkov, another DVR leader, told NTV television that Starovoitova
had received many threats from political foes, especially after she attacked
the Communists' over Makashov. 
But on Saturday the Communists were fast to denounce her murder and to deny
any involvement. They also blasted the authorities for failing to stem
Russia's post-Soviet crime wave. 
``It is very dangerous to speculate about the possible motives of the crime,''
Interfax news agency quoted senior Communist deputy Viktor Ilyukhin as saying.
``It is even more dangerous to try and blame the Communist party for this
simply because Starovoitova fought it.'' 
Echoing that view, Communist Duma speaker Gennady Seleznyov told Itar-Tass
news agency: ``Unrestrained and unpunished banditry has so far failed to face
a worthy response from the state. There must be something wrong with that.'' 
Some politicians, anxious not to crank up the political temperature any
further at a time of deep economic crisis, urged all parties to refrain from
attacking one another. 
``What must be done now is to focus on curbing crime rather than on political
differences between left and right,'' Vladimir Ryzhkov, deputy speaker of the
Duma and a senior member of the centrist party Our Home is Russia, told Tass. 


Russia Doesn't Approve Budget
November 21, 1998

MOSCOW (AP) -- The Russian government today failed to approve any of three
proposed versions of a draft budget for next year and called for more
revisions, including tax reform and foreign debt payments.
The government hopes to complete drafting its 1999 budget by Dec. 1, but it
will require more details on the planned tax reform, Economics Minister Andrei
Shapovalyants said after a four-hour meeting of key government ministers.
``We have to finalize volumes of (expected) tax collections and set new tax
brackets,'' he said.
Russia has been trying to persuade foreign creditors to restructure at least a
portion of about $17 billion payments due in 1999.
``Only when we know how much we will have to pay on our external debts (next
year), we will be able to set our fiscal policy,'' Shapovalyants said.
The government considered three versions of a budget draft, which put the
disparity between revenues and spending at either $9 billion, $16 billion, or
$21 billion, according to one senior government official, who spoke Friday on
the condition of anonymity.
Prime Minister Yevgeny Primakov met today with an International Monetary Fund
delegation after the meeting to discuss the country's economic situation, the
Interfax news agency said.
First Deputy Prime Minister Yuri Maslyukov said on Friday that Russia will ask
the IMF for new terms on repaying the $4.6 billion due to the lending
organization next year.
New IMF loans to Russia have been on hold since August. The IMF has insisted
it will not release any more money until the government comes up with a
comprehensive plan to combat the economic crisis and starts implementing it.


The Economist
November 21, 1998
[for personal use only]
A cold, hungry, pointless Russian army 
M O S C O W 

FOR an entrance to a death-machine, the conscription centre in eastern Moscow
looks remarkably inoffensive. The 1.5m-strong Russian armed forces killed
1,270 of their own young men last year according to official figures, though
some observers say the number could be five times higher. For comparison, nine
years in Afghanistan cost—officially—15,000 Soviet lives. In recent years,
some have even died of cold or malnutrition. Yet the new conscripts and their
mothers, strolling recently through these warm, well-painted corridors at the
start of the autumn call-up, provide dutiful explanations of why they want to
serve their country. “It’ll make a man of him,” says one mother, whose younger
son is among the autumn’s total of 158,000 conscripts. 
As a means of manly education, two years in Russia’s army leave a lot to be
desired. Dedovshchina, the routine bullying of new conscripts by their
seniors, is so brutal that it produces dozens of suicides. Officers can behave
horribly: not long ago one of them had two soldiers thrown into a three-metre-
deep pit—as was revealed when the pit cover collapsed in the night, killing
one of the soldiers. 
For modern warfare, which generally requires small armies of ready-to-go
professionals, there is little military point in conscription. Russia sticks
with it chiefly because the country cannot afford a fully professional force.
Soldiers spend much of their time foraging for food. Recently, the defence
ministry advised them to catch fish and pick wild mushrooms to supplement
their winter diet. 
Only a small part of the armed forces—chiefly the modest number of
professionals serving in Central Asia or in special units near Moscow, or in
charge of nuclear weapons—still has any real military role. Most of the rest
just hang on, often unpaid. Many moonlight as security guards or taxi drivers.
Some of the more senior ones act as brokers for their juniors’ forced labour
on building sites or in the fields. “You think it’s an army. In fact all
you’ve got is people in uniform,” says Dmitri Trenin, a retired colonel now
with the Carnegie Endowment, a think-tank. “The army is slavery, and we are
slaves,” says Vladimir Skripkin, of the Anti-Militarist Radical Association,
which campaigns against conscription. 
Like other bits of the Russian state, the armed forces are falling out of the
centre’s grasp. Moscow’s powerful mayor, Yuri Luzhkov, makes sure that young
men from his city serve either locally or on Russia’s balmy Black Sea coast.
In the old days conscripts were moved round the country in order to build up
national loyalty. Regional commanders are increasingly dependent on their
local authorities, not Moscow, for supplies of food and fuel. 
Where will this disintegration lead? Conceivably to a military putsch,
although that would require an unlikely amount of planning and nerve.
Warlordism is another potential danger. Yet, so far, regional military leaders
seem to have won only a modicum of veto power over what their men can be told
to do, not full control. The likeliest answer is: even more crime. Last month
three officers were convicted of stealing gold, silver and platinum parts from
anti-aircraft missiles and selling them to foreigners. 
In a country that still has more than 6,000 nuclear warheads, sloppy security
is frightening. For ordinary Russians, so is the thought that some of their
cold and hungry soldiers may one winter’s day start looting outside rather
than inside the barracks. 


International Herald Tribune
November 21, 1998
[for personal use only]
An American Military Priority: Feed the Russian Army
By Jim Hoagland The Washington Post

WASHINGTON - Once a proud nuclear superpower with global ambitions, Russia
today cannot feed its own army. Malnutrition stalks its ranks. The Kremlin may
soon halt drafting young conscripts: It cannot afford to pay recruits their
salary of $4 a month.
Russia's economic collapse has become the driving force in the making of
military strategy in Moscow and in Washington. The world is slipping into a
new strategic era: America's leaders will have to decide to help the Russian
military survive in something like its present form, or take a gamble that
more fragmentation and turmoil will promote American interests.
The growing Russian desperation surfaced in Prime Minister Yevgeni Primakov's
comments to Vice President Al Gore during this week's Asian economic
conference in Malaysia. The West, Mr. Primakov bitterly noted, refused to give
$8 billion in emergency help to Russia while ponying up $40 billion for Brazil
this month. Mr. Gore's unresponsive response reflected the wait-and-see mode
the administration has adopted as it surveys the wreckage of its multilateral
aid packages and summit initiatives, diplomatic sources report.
It now comes back to the soldiers who stood watch on both sides during four
decades of Cold War to guide difficult decisions that cannot wait.
Those choices range from the basic needs of food and shelter to setting
strategy for the decaying Russian nuclear arsenal.
Consider the symbolism of a proposal being considered by a high-level U.S.
interagency working group: Should the Pentagon give millions of surplus field
ration kits to the Russian Army to get it through the winter?
U.S. military leaders who once focused on destroying Moscow's armed forces, if
the need arose, today lean toward providing the packaged MREs, or Meals Ready
to Eat, the Pentagon suggests in public and private comments. This would give
humanitarian help to vanquished soldiers, and keep them from selling weapons
or know-how to terrorists.
The political risks, however, are formidable. How to be sure the food will get
to the truly needy? How to convince Congress that the Russian army is a
reliable partner and not rebuilding for another era of adventurism? And on the
Russian side, how to handle such U.S. help without risking humiliation?
Russia has not made a formal request for such aid. But Mr. Primakov has let it
be known informally that food aid to the army would not be turned down,
diplomats say.
Working to overcome the obstacles to food aid to the Russian military is in
the best interests of both countries. The key lies in making the mutual
benefit of such an idea plain for all to see.
Russia has been unable to push ahead with plans for restructuring and
reforming its armed forces, which now number about 1.4 million. Making food
aid part of a broader program of U.S.-assisted military reform and the
reduction of nuclear risks is essential to defusing hostile political reaction
in both nations.
U.S. officials are hoping that the Duma, or Parliament, is finally poised for
a decisive vote in December on ratification of the START-2 treaty. But even if
that vote is once again blocked, the time has come for a significant U.S. push
on a new strategic nuclear road map with the Russians.
Senator Bob Kerrey, Democrat of Nebraska, addressed the need for such a push
in a thoughtful speech on Nov. 17. Mr. Kerrey drew attention to a law that
requires the Pentagon to keep a minimum of 6,000 nuclear warheads actively
deployed (to pressure Russia to pass START-2). He correctly described the law
as a self-defeating, expensive measure that ultimately ''undermines our
national security interests.''
Mr. Kerrey's proposals include a unilateral U.S. cut of 50 percent in the
present arsenal and an immediate ''stand-down'' of the 3,000 warheads to be
eliminated from their current hair-trigger alert status. This would encourage
the Russians to follow suit, Mr. Kerrey believes. 
The White House prefers to negotiate with Moscow reciprocal reductions and the
taking of missiles off alert status. President Bill Clinton has already
approved a still secret Presidential Decision Directive on U.S. goals for
START-3 negotiations, which could begin immediately after Russian ratification
of START-2.
In the next few weeks the U.S.-Russian relationship will cross a new military
watershed as decisions on food aid, de-alerting and START get made. If handled
properly - if the political will exists in Congress and the White House and in
the Duma and the Kremlin - these decisions could bring a deeper, beneficial
U.S. involvement in shaping the consequences of Russian collapse.
If mishandled, we are in for a return to a cold time of contained conflict.


New agency to tackle Russia's sick banking system

MOSCOW, Nov 21 (Reuters) - Prime Minister Yevgeny Primakov has signed an order
setting up an agency to restructure Russia's ailing banks, a government
spokesman said on Saturday. 
The agency will consist of a non-bank credit fund, with capital of 10 billion
roubles. Fifty one percent of the agency will belong to Russia's Federal
Property Fund and 49 percent to the Central Bank, press spokesman Andrei
Kortunov told Reuters. 
``The aim of the agency is to restore the country's banking system,'' he said.
Igor Shuvalov, head of the Federal Property Fund, said in televised remarks
the agency would function for up to five years. He said the head of the new
body had not yet been chosen. 
Many Russian banks have been driven to the brink since the government
suspended payments on T-bills and allowed an effective devaluation of the
rouble currency in August. 
Government experts said the new agency should be formally registered by
December 1 and stressed that resources used for the restructuring of banks
would not come from the cash-strapped state budget. 
The finance ministry, the economy ministry and the Federal Property Fund will
identify over the coming weeks the composition of federally owned assets that
will form the agency's authorised capital. 
Primakov's decree envisages use of loans from the European Bank for
Reconstruction and Development and the World Bank to help fund the bank
The government experts listed the tasks of the agency as boosting the capital
of a healthy core of banks, improving the quality of their assets, creating a
long-term base for servicing clients in the ``real economy'' and restoring
both domestic and foreign trust in Russia's shattered banking system. 
They said the agency would remove incompetent bank directors, tap new
resources from both Russian and foreign owners and improve the management of
bank assets. 


Boston Globe
November 21, 1998
[for personal use only]
Running for daylight 
Amid financial ruins, one Russian bank strives to grow
By Jean MacKenzie (

MOSCOW - Alfa Bank is not yet giving away free toasters with each new account,
but managers have thought of almost everything else to drum up business. 
''Having trouble with payments? Accounts frozen? Paying employees in cash?
Call Alfa Bank!'' screams a full-page ad in The Moscow Times, an influential
English-language daily. The bank has even begun a television campaign in an
all-out effort to bring new customers - and a bit of cash - to its doors. 
Alpha is one of a very few top banks left standing after the economic tidal
wave that has swept Russia since mid-August. With a little liquidity and a lot
of bravado, it is seeking to capitalize on the disaster. In so doing, it hopes
to jump from Russia's ninth-largest bank to a spot much closer to the top. 
Russian banks had been cashing in on short-term, high-yield treasury bills,
known as GKOs. The rewards were enormous - over the past six months banks have
been riding a roller coaster of interest rates that went from 30 percent to
close to 200 percent. 
Bankers freely admit that the easy-money GKOs were tough to resist. 
''GKOs were the biggest breadwinner,'' said Max Topper, Alfa's head of
international banking. ''Let's face it, everybody milked that cow. We did as
But big profits come with corresponding risk. On Aug. 17, the government of
former Prime Minister Sergei Kiriyenko defaulted on Treasury bills, depriving
most of the country's banks of their biggest cash source. Unable to service
their depositors, they froze accounts and closed their doors. 
Alfa, which slimmed down its GKO portfolio considerably in the spring, kept
going, and is now trying to attract those left in the cold. It has been
beefing up its client services, and is one of the few places in Moscow now
where foreigners can get dollars. Since the crisis hit, getting cash has been
a major headache for those whose paychecks are deposited offshore. But Alfa
has an ATM that will dispense up to $1,000 on Western bank cards. 
''It has made it a lot less risky to live here,'' said one satisfied customer.
Alfa did not emerge unscathed. Officials say that the bank had $100 million
tied up in GKOs, but other banks had much more. 
''Everything's relative,'' Topper said. ''Let's say we're weathering the
Another advantage was Alfa's fairly small retail banking department, which it
is now trying to grow. When the crisis began, depositors rushed to withdraw
their savings. Alfa's lack of depositors saved it from a panic-driven run on
its cash. 
The bank is led by Pyotr Aven, who was foreign trade minister in the early
days of Russian reform. In addition to good contacts and lucrative accounts,
he brought to the bank a conservative philosophy and a team of Western-
educated managers. 
Alfa is more a tortoise than a hare in the race to riches. Last year, it
acquired a 40 percent stake in Tyumen oil, Russia's sixth largest oil company,
becoming one of the last of the big banks to make the jump into natural
''We are trying to amass a strong corporate portfolio,'' said Topper, who is
Russian-born but grew up in Canada. ''The resources that other banks were
putting into GKOs, we channeled into lending.''
This is unusual in Russia, where traditional commercial banking generated a
too-low a profit margin to attract the big players. But it has given Alfa
enough of a base to ride out the crisis, at least for the time being. 
Analysts say that bank officials are a lot more worried than they are letting
on. Alex Knaster, a Harvard Business School graduate who is now Alfa's chief
executive, has reportedly stated in private that he is not sure the bank will
Alfa has already missed a payment on a $77 million syndicated loan that came
due Oct. 30. Topper insisted that the bank has enough money to service its
debts, but is just trying to hold onto its cash. 
''We have successfully restructured some loans, and our relations with
creditors are quite amicable,'' he said. 
Most of Russia's banks are deep in negotiations with foreign lenders. A 90-day
moratorium on foreign debt payments has expired, and the banking sector is
braced for catastrophe. 
Russian banks owe about $6 billion on forward contracts - insurance policies
signed by foreign lenders that guaranteed them a fixed rate on redeeming
rubles. The crash of the national currency - from 6 to 16 rubles to the dollar
in just a few months - has left Russian banks with a mountain of debt. 
The Russian press has been filled with near-hysteria. ''No one wants to
protect Russian banks from foreign creditors'' blared the lead in
Nezavisimaya, a prominent daily. The paper predicted that foreigners would
force the majority of banks into bankruptcy, and acquire assets such as oil
companies and the banks themselves at fire-sale prices. 
Unlikely, says Margot Jacobs, banking analyst with Moscow United Financial
Group. ''Western banks are only interested in getting as much money as
possible on these debts,'' she said. ''Bankruptcy would be counterproductive.
And who would really want to take over a Russian bank?''
Much more likely is a system of restructuring for those banks that could still
be going concerns, she said. 
But that number is shrinking rapidly. The government has devised a plan to
jump-start the banking sector, but it does not have the funds to prop up every
ailing institution. Officials at Russia's Central Bank, which regulates
monetary policy, estimate that out of approximately 1,500 banks, 720 will
In the long run, this may not be a bad thing, say banking analysts. 
Russian banks were never exactly like their Western counterparts. The
accusation most often leveled at them is that they were nothing more than
trading houses, or money laundering schemes, set up to facilitate the transfer
of funds to the West. But this is an exaggeration, says Garrett Pettingell,
head of corporate banking at Bank Austria, Moscow. 
''They were making an effort,'' Pettingell said. ''Most of the Russian banks
did want to grow up to be real banks.'' But the crisis has put an end to that
notion, he added. 
''Everything is changing now,'' he said. ''I see no signs that there is
responsible leadership to lead us out of this crisis.''


Date: Sat, 21 Nov 1998
For the Hindustan Times
From: Fred Weir in Moscow

MOSCOW (HT Nov 21) -- President Boris Yeltsin's plans to
visit India have not been cancelled but merely postponed, the
Kremlin insisted at the weekend.
The statement, issued by presidential spokesman Dmitri
Yakushkin, deepens the confusion over Mr. Yeltsin's role in
Russia's power arrangements since his failing health and the
country's dire economic crisis appeared to sideline him in
Last week the Kremlin said Mr. Yeltsin would not make the
trip to India, slated for early-to-mid-December, and Prime
Minister Yevgeny Primakov would go in his place.
Mr. Primakov has increasingly taken on the ailing Mr.
Yeltsin's state duties, to the point where there is serious talk
in Moscow's political establishment of getting parliament to
appoint him Vice President.
But Mr. Yakushkin made an about face at the weekend, and
insisted Mr. Primakov will go to India in December but "not as a
replacement for President Yeltsin."
"This in an independent visit by Primakov," he said. "As for
the visit by the president of the Russian Federation, that has
not been canceled. It has been postponed, and the dates are being
worked out."
And he added: "This has nothing to do with President
Yeltsin's health. This has to do with the need to resolve
problems that have built up in our economic and trade relations
with India. And that is the job of the prime minister."
But Mr. Yakushkin admitted the Kremlin doctors were 
"not enthusiastic" about the prospect of Mr. Yeltsin travelling to 
India at this time. He said it would mean a long flight, change of 
climate and time zones, all of which could have unpredictable effects 
on the President's weakened metabolism.
Last week Naina Yeltsina, the President's wife, told the
wife of the visiting Japanese Prime Minister that her husband was
having great difficulty this year in adjusting to the onset of
Russian winter. "We hope he will be alright in a few days," Mrs.
Yeltsina was quoted as saying.
Mr. Yeltsin underwent quintuple heart by-pass surgery in
1996, and has regularly since been afflicted by what the Kremlin
calls minor illnesses that keep him out of action for days or
weeks at a time.
But his health appears to have worsened in recent months.
All the President's foreign travel plans since a blunder-plagued
September visit to former Soviet Central Asia have been cancelled
or postponed, and even foreign leaders visiting Moscow have found
their meetings with him curtailed.
The Parliament has stepped up pressure on Mr. Yeltsin to
cede some of his sweeping Constitutional powers, something the
President has said he might do in the New Year.
But analysts say the fresh confusion over Mr. Yeltsin's trip
to India could signal that the 67-year old leader is fighting
back against the impression that he is no longer a fully acting
"If Primakov takes over all his functions, then people will
start asking what we need Yeltsin for at all?" says Nikolai
Zyubov, an independent political expert. 
"Yeltsin has obviously instructed his spokesman to say the
visit to India is still on, and Primakov is going in a different
capacity. That way some shreds of his Presidential authority are
preserved," he says.
"But it's obvious Primakov will go to India and that he will
conduct all the business that Yeltsin would have. Whether Yeltsin
himself will ever go is an open question." 


Moscow Tribune
November 20, 1998
Russians Queue in Snow for U.S. Visas
By Lyuba Pronina 

Applicants for visas at the U.S. Embassy in Moscow are complaining they still
have to spend hours standing outside in the cold weather, despite new
procedures introduced last month and a doubling of the application fee. 
Since Thursday, a new system has been in place for the issuing of tourist,
business and study visas, which was designed to eliminate the need to spend
hours queuing outside the embassy. 
"Our family has been doing this every year since 1995. This is the longest we
have ever waited," said an American citizen with a Russian spouse. They were
just about to enter the embassy after spending two-and-a-half hours freezing
in the snow. 
When they arrived at the embassy at 7:30 am, there was a queue of at least 150
people. According to the new regulations, applicants are admitted to the
embassy to hand in applications from 8 a.m. to 3:30 p.m. on weekdays. They are
given an appointment slip which indicates the interview slots available over
the next 48 hours. The interview is offered either for the following day or
for a date convenient to the applicant. 
Same-day interviews, available before the new regulations came into force, are
rare, people in the queue claim. To get in, applicants say they have to spend
at least an hour and a half outside, which is not helped by the current
weather conditions. 
"My feet are numb after standing here for 20 minutes," said a young woman from
the queue. 
"It's worse than it used to be," said a tourist agent on Wednesday, who
requested anonymity. "Before you could do everything in one day, hand in the
application and get your interview. You would normally get in within an hour."
A U.S. Embassy official contacted by the Moscow Tribune admitted the queue
might be creating problems for applicants. The official maintained, however,
that with the new regulations the "situation has changed considerably," with
waiting hours cut down "from four-six to one hour," and queues becoming rarer.
"The fact that people line outside is generated primarily by the number of
people applying for the U.S. visa. It's not a perfect system, that's an
ongoing effort," the official said, adding that the embassy expects that the
new application procedures will help eliminate the crowds outside with time. 


The Guardian
November 21, 1998
[for personal use only]
Primakov savages Russia's reformers 
By James Meek in Moscow (

In his harshest denunciation of Russia's seven years of economic reform, the
prime minister, Yevgeny Primakov, accused the West of continuing to listen to
a failed band of Russian leaders who had cheated them out of billions of
Mr Primakov, the nearest thing to a leader with Boris Yeltsin a semi-invalid,
said the "reformers" - a loose name for the young, English-speaking economists
and bureaucrats who acted as go-betweens for Western lenders after 1991 - had
left the country with more problems than it inherited from 70 years of
The most notorious reformers are former prime minister Yegor Gaidar and ex-
deputy premiers Anatoly Chubais and Boris Nemtsov, but Mr Primakov mentioned
only Mr Chubais by name.
This former politician, now head of Russia's electricity monopoly, is blamed
for the country's disastrous privatisation programme and for the August 17
decision to default on some Russian debts.
"Chubais denies the words attributed to him by the Los Angeles Times, which
quoted him as saying the reformers had 'swindled' the West out of $20 billion
dollars," said Mr Primakov. "Perhaps he didn't actually pronounce these words,
but that doesn't alter the fact of what actually happened."
Mr Primakov, interviewed in Izvestiya newspaper, was speaking in Malaysia,
where he was attending the Asia-Pacific Economic Community meeting. The venue
was significant, since Mr Primakov's accession signifies a shift towards a
more East Asian style: not anti-Western, and pro-capitalist, but also
nationalist, patriarchal and with a strong state economic role.
In part the outburst was a classic attempt by a new government to blame
predecessors for current woes. But it showed his anger that the West prefers
to go on listening to the reformer view of what has gone wrong rather than
talking to his more old-fashioned, Soviet-shaped ministers.
He said: "Criticism of our plans and our activities is based on information
which the West receives from very specific sources - our predecessors. They
still have support in certain Western political circles and the media. And
there's a paradox in this, since our predecessors are the people who pulled a
fast one on the West."
Mr Primakov said he had invited Larry Summers, the US deputy treasury
secretary, to visit Moscow to "correct" some of misconceptions. He added:
"We'd like Mr Summers not so much to talk as to listen."
The Primakov government, which still contains one reformer, the finance
minister Mikhail Zadornov, is increasingly desperate for Western lending to
Russia to resume. If the IMF does not restart payments on its suspended long-
term loan soon, they fear that Russia will not only default on its sovereign
debt next year, but be forced to accept hyperinflation.
As foreign minister and spymaster in the Yeltsin years, Mr Primakov was
sheltered from Russia's horrific financial position. His shock and anger
yesterday at the state to which the country had been reduced was probably
"The real economy did not develop under the reformers," he said. "Practically
nothing permanent was created. Instead they had a single model: macroeconomic
stability as a fetish, as an end in itself. This is the mess the new team
found when it entered the White House. This is the mess we've now got to clear
up. And the people who made this mess are now going around like oracles. And
the West is listening to them."
In spite of Mr Primakov's pleas, the IMF and Western governments have genuine
doubts about his government.
There is still no clear economic plan and no budget for next year, and Mr
Primakov seems ready to sacrifice decisive leadership for the sake of not
offending factions in the divided parliament.
As foreign minister, Mr Primakov had a good relationship with the US secretary
of state, Madeleine Albright. In his interview he gave a strong sense of
feeling betrayed by the West, while the guilty men went unpunished.
"It was the reformers who laid the Russian banking system waste, spat on their
international obligations and introduced a unilateral moratorium," he said.
"It was they, and not us, who organised all sorts of financial pyramids,
drawing in speculative capital with a short life-span and an inclination to
flee the country.
"They didn't pay the slightest attention to the social aspects of the economy.
But as one American newspaper perceptively noted, you can't carry out
monetarism without people."


Moscow Times
November 21, 1998 
BOOKWORM: Bringing Top Titles To Foreign Publishers 
By Igor Zakharov 

It's tough times for Russian publishers. Between low sales and even lower
prices, they are in danger of extinction. 
Russia used to be called the "most reading" nation in the world, and popular
authors were published in millions of copies. But nowadays an initial print
run of 5,000 copies is considered a "mass" release, and any book that sells
more than 10,000 copies is labeled a bestseller. 
The retail price of a book in this country was just one-tenth of a comparable
book in the West even before the financial crisis hit, and is now about one-
There are 12,000 registered publishers in Russia. How can they survive? 
Most of Russia's publishers cannot afford to go to the annual Frankfurt
International Book Fair. So the State Press Committee earlier this year
supported the idea of having its "independent expert," Yuri Maisuradze, select
the 100 best new Russian books and sponsor their presentation last month to
the international public in Frankfurt. 
A special committee first made a shortlist of 250 titles and then a final list
of 104. Critics have many reasons to quibble with the list, including the fact
that many great books were neglected but one nonentity was included twice. 
I will not bother describing all the hullabaloo that followed, the inevitable
press conferences, presentations, etc. And I doubt whether it is necessary to
add another small detail, which sophisticated readers may have already
guessed: The books were not exhibited in Frankfurt at all due to the financial
and "organizational" problems of the committee. 
But it was a good idea anyway. Foreign publishers should see the best new
Russian titles - not necessarily the most beautiful books, but those that have
the greatest intellectual and cultural potential to be published abroad. 
A complete list may be found in the newspaper Vremya on Nov. 16. I noticed
with satisfaction that most of the books on the list have been mentioned in
this column. Then I divided the titles into the following categories: fiction
(10 titles), history of literature (10), memoirs (10), national history (10),
art (20), references (20) and textbooks (20). 
Under fiction were modern classics like Nikolai Gumilyov, Valery Bryusov,
Varlam Shalamov and contemporary authors Andrei Bitov, Anatoly Naiman, Yevgeny
Yevtushenko, Vladimir Sorokin and Vladimir Makanin. 
In the memoir column were Nobel laureate Alexander Solzhenitsyn, academician
Dmitry Likhachyov, theater people Tatyana Doronina, Oleg Dahl, Andrei
Under art were "Russian Style," "The Bolshoi Theater," "The Architectural
Monuments of Moscow," "Collectors in Old Moscow." 


Communists Likely To Lose Impeachment Game 

MOSCOW, November 17 (Itar-Tass) -- The proceedings for the president's
impeachment instituted by the left opposition will not lead to any results
for lack of juridical grounds. They will only result in the ostentatious
display of the opposition's attitudes. Such is the view of most deputies
of the State Duma lower house of Russian parliament, as well as of members
of the Federation Council upper house and other politicians.
In the opinion of leader of the Duma faction of Our Home is Russia
movement, Aleksandr Shokhin, "there are virtually no contents in the
juridical substantiation of the impeachment procedure, while charges
advanced by deputies against the president have no element of crime, that
is, the basis for impeachment under the Constitution is lacking".
Communists accuse Yeltsin of the breakup of the USSR and blame him for
the war in Chechnya and the dissolution of parliament in 1993. Shokhin
said the procedure of the president's impeachment can be described as
"sorting out political relations not touching upon Constitutional grounds
for impeachment," as most charges against the president are invented.
He believes the commission for the president's impeachment will be
sitting for quite a long time, but its work can hardly have any serious
consequences. Shokhin recalled that the bulk of the charges against the
president relate to "a different President Yeltsin, who was elected to his
office in 1991"."Such events as the Soviet Union's disintegration or the war
Chechnya coincide with the first presidential term and, to my mind, there
is no reason to take these accusations seriously as these 'transgressions'
have been cancelled by Yeltsin's election for a second term in July 1996 if
they had taken place at all," Shokhin noted. Therefore, OHR will be voting
unanimously against official charges directed at the Russian president, the
faction's chief said.
Yabloko faction in the Duma shares his views. Its leader Grigoriy
Yavlinskiy noted that impeachment should definitely be a juridical
procedure, not an act of political vengeance under its guise. Duma Deputy
Speaker Mikhail Yuryev, Yabloko member, said that accusing the president,
the left forces juggle with such notions as "genocide against the people",
"putting the country in disarray". "There are no such articles in the
Criminal Code," he said. Yuryev believes the Communists are well aware of
this, so they just "go through the motions of opposition activity, aimed at
creating an uproar".
Duma Speaker Gennadiy Seleznev said, regarding the commission's work,
that "impeachment is a constitutional procedure, but very difficult to
implement". It is believed in the Federation Council that the launching of
the procedure attests to the lack of political culture. "You should read
the Russian Constitution to realise that we will not have to deal with this
matter," speaker of the upper house Yegor Stroyev said.
Governor of the Saratov region Dmitriy Ayatskov said that "there will
be no impeachment as the Constitution will not permit this". Governor of
the Samara region Konstantin Titov believes that even if the proposal of
Duma deputies for the impeachment is passed in the lower house, it will not
be backed by senators.
Under the regulations the question of impeachment, following a
motivated conclusion by the special group of the Duma commission, is
referred to the State Duma to pass an official verdict blaming the head of
state of grievous crimes. If no less than 300 Duma deputies vote for the
impeachment, charges will be advanced against the president and the
materials will be referred to the Russian Supreme Court and
The Supreme Court is to draw the conclusions about the presence of
elements of crime in the president's actions covered by the Criminal Code. 
The Constitutional Court is required to confirm that all actions of the
State Duma for impeaching the president are within the Constitution.
Then the materials are referred to the Federation Council and it is to
adopt a decision within three months since the official vote for the
impeachment by 300 deputies. If no such decision is adopted on the expiry
of this term, the charges are annulled.
If the Federation Council discusses the Duma charges within the
allotted time of three months and there is a positive conclusion of the
Supreme Court and Constitutional Court, the upper house puts the matter to
vote. If no less than two-thirds of senators cast their ballots for the
impeachment, then the president is removed from office.
Presidential envoy in the State Duma Aleksandr Kotenkov has many
doubts that the votes of 300 deputies for the president's impeachment will
be collected in the Duma. He believes this will be the first barrier. 
There will also be the second barrier, the conclusion of the Supreme Court,
Kotenkov said.
The matter is that deputies who started the impeachment proceedings do
not read either the Constitution or the Criminal Code. "What they try to
blame the president for is not envisaged in our criminal legislation," hesaid.
As to the Constitutional Court, it may give a positive conclusion on
these charges only if the president's actions for which he is blamed are
mentioned in specific articles of the legislation. "Naturally, there is
nothing of the kind. So the impeachment started by the left forces in the
State Duma is an absolutely groundless undertaking, which will fail,"
Kotenkov believes.
Kotenkov said the president has nothing to worry about. "However
deputies may want this, no court can find elements of crime in the
president's actions". Nonetheless, the commission has advanced charges on
three counts: the signing of the Belovezhye accords that put an end to the
USSR's existence, the dissolution of the opposition parliament in October
1993, and the Chechen war.
If only remains for the Duma commission to draft charges on two more
counts: dissolving the army and "genocide against the Russian people." The
commission's chairman Vadim Filimonov believes the conclusions on all
counts of the verdict will be ready by December.
There are doubts about this. Russian Communist Party leader Gennadiy
Zyuganov claimed last summer that the commission would complete its work in
September, at the latest in October. And deputy chairperson of the
commission Yelena Mizulina claimed that the overall draft conclusions will
be completed by early October. So there are contradictions within the
commission which, in Kotenkov's words, does not permit it to refer its
decisions to the plenary meeting.
Thus, one of the commission's members, chairman of the Duma
legislative committee, said that implementing the impeachment proceedings
and carrying them through in accordance with law is very difficult, as this
requires the backing of the absolute majority of members of the Federation
Council, the Supreme Court and the conclusion's of the Constitutional Court
about observance of the procedure. For various reasons, most witnesses did
not show up for the commission's meeting, and this indicates that the
commission's activity is not taken seriously.


U.S. Consul Charged in Car Accident
November 20, 1998

MOSCOW (AP) -- The traffic safety department in the city of Vladivostok in
Russia's Far East has charged the U.S. consul general with injuring a
pedestrian in a car accident, a news report said Friday. 
The U.S. Embassy in Moscow confirmed that Consul General Douglas Kent was in a
car accident Oct. 27. Embassy spokesman Michael Hurley had no other details
about the case Friday and said the consulate was handling it. 
No one was available for comment at the consulate in Vladivostok, eight time
zones and 4,000 miles east of Moscow. 
The Interfax news agency quoted traffic department chief Viktor Chaika as
saying Kent caused a three-car accident in which a 23-year-old pedestrian
suffered a serious spinal injury. The traffic department in Vladivostok
charged him with violating traffic safety and causing injury to a pedestrian. 
While Kent is subject to Russian laws, if convicted he is likely to be
expelled instead of sentenced, because of his diplomatic immunity, Chaika


Moscow Times
November 21, 1998 
Yeltsin Denies TV Share Trade 

President Boris Yeltsin's former bodyguard said Friday that he had received
instructions from controversial financier Boris Berezovsky to transfer more
than one-quarter of the shares in Russia's largest television station to
Yeltsin, Interfax reported. 
Yeltsin's spokesman Dmitry Yakushkin denied the charge Friday. 
"[The president] has no shares, doesn't control any shares, and this question
was not coordinated with him," Yakushkin said at a news conference. 
Opposition lawmakers in parliament are currently investigating whether the
alleged transfer was a veiled bribe paid to the president by Berezovsky. 
Communist State Duma Deputy Viktor Ilyukhin said Wednesday that Berezovsky had
given the bodyguard, Alexander Korzhakov, the power of attorney to give 26
percent of shares in the ORT television station to Yeltsin in 1994. 
Korzhakov, the former head of the presidential security service and Yeltsin's
confidant for 11 years, was quoted by Interfax as saying that he delivered the
official document to Yeltsin in 1994. 
Korzhakov, was ousted in a Kremlin power struggle in June 1996, added that he
"always acted on the president's orders," Interfax reported. 
The station is 51 percent government-owned, with the remainder held by various
private investors, including Berezovsky. 
Berezovsky confirmed Thursday that the shares were transferred, but said that
Korzhakov had forced the transaction. 


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