Center for Defense Information
Research Topics
CDI Library
What's New
CDI Library > Johnson's Russia List

Johnson's Russia List


March 15, 2000    
This Date's Issues: 4169 4170


Johnson's Russia List
15 March 2000

[Note from David Johnson:
1. Itar-Tass: Early Voting in Presidential Elections Starts Wednesday. 
2. AP: Russian liberal group to back Putin in poll.
5. Christian Science Monitor: Robert Bruce Ware and Ira Straus, Media bias on Chechnya.
6. New publications from Carnegie Moscow Center.
7. Democratic Partners: the U.S.-Russia Student Leadership Summit.
8. Andrei Liakhov: On Borovik.
9. BBC: Online bets on Russia's election.
10. Summary of Dorenko's program on ORT March 11.
13. Bloomberg: Koehler's Commitment to Russia Could Signal New Tone at IMF.
14. AP: David McHugh, Putin Faces Challenge of Economy.
16. The Independent (UK): Helen Womack, In the footsteps of Catherine the Great, a woman makes a bid for power. (Ella Pamfilova)]


Early Voting in Presidential Elections Starts Wednesday. 

MOSCOW, March 15 (Itar-Tass) - Vessel crews, personnel of polar stations and 
a number of garrisons, and residents of remote areas start early voting in 
the Russian presidential elections on Wednesday. According to the preliminary 
estimations, 250,000 people maximum out of the 108 million Russian voters 
will take part in the early voting, Chairman of the Central Electoral 
Commission Alexander Veshnyakov said on Tuesday. 

Ten constituencies of Russia have remote areas to enjoy early voting, among 
them the Republic of Tuva, Buryatiya, Kalmykiya, the Komi-Permackij 
autonomous district, the Nizhni Novgorod, Kemerovo, Irkutsk, Arkhangelsk, 
Sakhalin and Amur regions. 

District electoral commissions will provide for secret voting, exclude 
distortion of voters' will and ensure safety of ballot sheets and account of 
early votes in final results of the elections. 

As a rule, early voting in remote areas is done within a day from 8 am 
through 8 pm. Still, exceptions are possible when a group of voters is on 
combat duty far away from a polling station. In such cases the voting can 
last for two or more days, but it cannot take place after the universal 
elections date in the country. 

Early voting is also possible outside the territory of Russia if a foreign 
country does not have Russian diplomatic missions or they are far away from 
residence of Russian nationals. 

Results of early voting by vessel crews, personnel of polar stations and 
residents of remote areas can be supplied to a higher electoral commission, 
up to the Central Electoral Commission, with the use of technical means, 
mobile radio sets included. 


Russian liberal group to back Putin in poll

MOSCOW, March 14 (Reuters) - Leaders of Russia's liberal Union of Right-Wing 
Forces (SPS) said on Tuesday their faction had decided to back Acting 
President Vladimir Putin in the March 26 presidential election. 

``The majority of the faction's coordinating council voted today to support 
Vladimir Putin,'' SPS parliamentary leader and former prime minister Sergei 
Kiriyenko told reporters. 

Putin, who has pledged support for market reforms but also wants to 
strengthen the state to fight corruption and crime, is runaway favourite to 
win the election. 

SPS, led by Russia's so-called ``young reformers,'' had previously said it 
would not publicly support any candidate in the election. 

The decision to back Putin came as a disappointment to SPS member and 
presidential hopeful Konstantin Titov, governor of central Russia's Samara 
region, who said the party could split. 

``SPS likes backing favourites,'' said Titov, who opinion polls suggest will 
win less than one percent of the vote. 

Kiriyenko said he believed Putin should win outright in the first election to 
kill off any danger of an upset victory for Communist Party candidate Gennady 
Zyuganov. Opinion polls put Zyuganov in second place but far behind Putin. 

``If there is a second round in the election, we might artificially inflate 
the bubble of Mr Zyuganov,'' said Kiriyenko. 

Not all the SPS leadership agreed. 

Boris Nemtsov, a former deputy prime minister, said he and Irina Khakamada, 
another leading party member, abstained in the vote on whether to back Putin. 

Nemtsov added that he thought Russian democracy would be healthier if there 
were two rounds, to give voters wider choice and more time to think about the 
options available. 

Putin discreetly endorsed SPS's economic plans before last December's 
parliamentary poll. But relations then went through a painful patch when the 
Putin-backed Unity party struck a deal with the Communists dividing up 
control of the new State Duma lower house of parliament, cutting SPS out of 
key posts. 

The Communists and Unity are the two biggest factions. 

The deal, which raised doubts about Putin's true political plans, triggered a 
temporary boycott of parliamentary proceedings by SPS, the reformist Yabloko 
faction and the centrist Fatherland-All Russia bloc. 



MOSCOW. March 14 (Interfax) - Acting Russian President Vladimir
Putin opposes the complete independence of regional governors.
"Full independence is impossible," Putin told journalists in an
interview published in the book entitled "In the First Person.
Conversations with Vladimir Putin."
"Local self-governance should be retained as well as gubernatorial
elections. However, possibilities for imposing sanctions on governors
should be envisioned while preserving the electoral process. For
instance, a dismissal" could be resorted to, Putin said.
Constitutional amendments are possible, he said. "What is
stipulated now should be carefully evaluated from the position of
meeting the interests of the state and society in its entirety. If the
chapter on the presidential duties stipulates excessive powers, its
revision should be considered. This is a subject for a broad discussion.
Russia was founded as a super-centralized state from the very start.
This is inherent in the genetic code, traditions and people's
mentality," he said.
The restoration of monarchy is unlikely in Russia, he said.
"Monarchy played a positive role in certain periods of time and
continues to do so and in certain places," he said.



MOSCOW. March 14 (Interfax) - The Strategic Research Center will
have drawn up the ideology behind a program for Russia's development
over the next 10 years by April, the Center's head German Gref said on
Monday. A new Russian government will be formed in April.
The new program is based on the compliance of the state's
commitments with "the real budget," Gref told journalists.
At the moment, the state obligations stand at 58% of GDP while the
realistic budget revenue does not exceed 35% of GDP, he recalled.
This program will boost confidence in the state which must keep its
promises, he said.
The program envisions lower public sector spending. Therefore, the
tax burden will be eased and the tax system revised, he said.


Christian Science Monitor
15 March 2000
Media bias on Chechnya
By Robert Bruce Ware and Ira Straus
Robert Bruce Ware is assistant professor of philosophical studies at 
Southern Illinois University, Edwardsville. He conducts field research in the 
northeast Caucasus. Ira Straus is US coordinator of the Committee on Eastern 
Europe and Russia in NATO. In 1997-98 he was a Fulbright professor of 
political and international studies in Moscow. 

The maxim that truth is the first casualty of war has taken on new meaning in 
the conflict in Chechnya. Russian journalists and Western observers have 
expressed concern throughout the seven-month war about restrictions on media 
coverage, while Moscow has leveled charges of bias and distortion. 

The media wars have renewed animosities and contributed to mistrust that is 
likely to color US-Russian relations and influence global security long after 
the present conflict is forgotten. 

Western journalists have claimed that the popularity in Russia of the war - 
which, despite the Russian capture of the capital Grozny, grinds on with 
sporadic skirmishes between Russian troops and Chechen rebels - is due to 
official repression and manipulation of the Russian media. 

Western reporters also counter the Russian version of the war by focusing on 
the brutality of the Russian military in Chechnya: indiscriminate bombing by 
Russian forces, civilian deaths, suffering of Chechen refugees, and massive 
human rights abuses. And American commentators observe that a country with 
democratic aspirations must permit its citizens to get the full story. 

But has anyone really gotten the full story? 

Our view of the war - based on travel and research in Russia and the Caucasus 
- suggests not. 

After Chechnya won de facto independence from Russia in 1996, kidnapping for 
ransom - along with auto theft, livestock rustling, and the systematic 
bleeding of petroleum pipelines - became the lawless, war-shattered region's 
primary economy. 

The hostage-taking drove all international relief and human rights 
organizations out of the region by the end of 1997. 

And Westerners weren't the only targets of kidnapping. More than 1,300 
Russian civilians - men, women, children, Christian, Muslim, light-skinned, 
dark-skinned - have been held in Chechen cellars under exceptionally brutal 

But it wasn't until Chechen-based Islamic militants invaded the southern 
Rus-sian republic of Dagestan that Russia returned to Chechnya with troops 
and artillery. The insurgent attacks left more than 1,500 dead and and 
displaced 32,000 Dagestani residents, many of whom are still homeless. 

Dagestan sympathized with Chechnya during the 1994-96 war - taking in 130,000 
Chechen refugees into private homes. 

But today, as a result of its more recent bitter experience with Chechnya, 
Dagestan accepts no Chechen refugees. Whereas Dagestanis previously 
considered Chechens their ethnic and Islamic brethren, they now support the 
Russian military in its campaign against Chechnya. 

We in the West are naive to think that the choice in the Caucasus is between 
the massive human rights abuses committed by Russians in Chechnya and no 
human rights abuses. The real choice is between the current Russian abuses 
and the massive abuses previously committed by Chechen groups in Dagestan and 
other areas near the Chechen border. 

If Russia does not succeed in imposing law and order in Chechnya, people 
living near Chechnya will be tortured and murdered once again. 

That's how people in the region see it. 

Westerners see it differently, and Western media support the existing frame 
of reference as surely as they ignore that of the Russians. The result is 
that westerners get the information they expect about the daily shootout and 
the human drama that results. But they aren't informed about the broader 
context of the war with all of its complexities. 

For example, how many Western media outlets reported that on Feb. 7 the 
supreme Islamic leader of Chechnya, Mufti Akhmed Khadzhi Kadyrov, said the 
occupation of Chechnya by Russian troops is necessary to protect the people 
from violent civil strife at the hands of Chechnya's warlords? The answer is 

Once established, this lopsided view has a tendency to reinforce itself. For 
example, while many human rights organizations have interviewed Chechen 
refugees, none of those organizations have interviewed Dagestani refugees or 
victims of the kidnapping industry. 

Human rights organizations dutifully confirm media accounts about displaced 
Chechens, and establish a Western truth in which Dagestani refugees are 

In Russia and in the West, each of two separate and opposing sides of the 
story comes to be accepted as the whole truth. 

The result is that no one gets a balanced view, rhetoric intensifies, and 
security relations deteriorate as everyone lapses into obsolete prejudices 
about the other side. 

Russians and Americans end up inhabiting opposing world views, each of which 
is seductively credible because of its self-sustaining partiality. 


From: KatyaSh@CARNEGIE.RU (Katya Shirley)
Subject: CMC has released two new publications
Date: Tue, 14 Mar 2000 

I would like to inform you that the Carnegie Moscow Center has recently
released two new publications described below. This info may be of interest
to the readers of your list.

Inequality and Mortality in Russia
Ed. by Vladimir Shkolnikov, Evgeny Andreev, and Tatyana Maleva

This collective monograph is published in Russian. The full Russian text can
be accessed at:

The English-language contents and summary of the book is at:

Pro et Contra
The Problems of Globalization
Vol. 4, No.4 (Fall 1999)

The full Russian text of the quarterly can be accessed at:

The English-language contents and summaries are at:

Electronic versions of all CMC publications beginning from 1999 are
available in full-text format at our Publications Web Site at For the majority of the Russian-language
publications contents and summaries in English are provided. 


Date: Tue, 14 Mar 2000 
From: Cody Shawn Harris <csharris@Stanford.EDU>
Subject: Democratic Partners: the U.S.-Russia Student Leadership Summit


As an undergraduate student at Stanford University, I have enjoyed (and
relied on) your amazing list during my time here. First, let me thank you
for devoting so much time to it.

Second, I wanted to let you know about a project that is currently being
undertaken at Stanford -- "Democractic Partners: the U.S.-Russia Student
Leadership Summit will be held from April 5-11, 2000. A group of
undergraduates here has raised over
$120,000 to bring a group of young Russian student leaders to Stanford for
a six-day conference. They will meet with American undergraduate student
leaders from across the country and discuss issues and challenges
surrounding student and community service and activism, as well as the
U.S.-Russia relationship. It will be a chance to open a constructive
dialogue between undergraduates in both countries.

Secretary George Shultz and former Bush Advisor Condoleezza Rice will hold
a reception for the participants. The program also includes a trip to San
Francisco, a tour of underprivileged communities near Stanford, panel
discussions with professors of political science and student leaders, and
the development of real community service projects to be implemented upon
the students' return home.

This project has taken much time and effort and is entirely student-run.
I thought you might be interested in posting something about it on your
list. Anyone interested in this conference can contact or visit our website at

Thanks, David!
Cody Harris
Stanford University


From: "Andrei Liakhov" <>
Subject: On Borovik.
Date: Tue, 14 Mar 2000 

As an additional snippet of information about the tragic death of the above,
it is being said in Moscow that at the time of his death, Artiom was working
on a story about the alleged meeting between Voloshin and Basaev, which,
again allegedly, took place shortly before the commencement of the Russian
army's operation "to restore law and order" in Chechnia somewhere in the
south of France. Although rumours about that meeting are circulating in
Moscow for several months now, on the face of it, it would be extremely
difficult to believe that something like that could have happened. However,
what is undisputedly true is that during the First Chechen War, the Chechens
seemed to know too much about the combat plans of the Russian Army.
Furthermore, some veterans of the first campaign assert that the Chechens
during the 1994-1996 conflict might have had some influence over the Russian
Army's movements in Chechnia. For some that is sufficient proof that during
the 1st campaign the Chechens had contacts in Russia which could give orders
to the Army (or at least allow Chechen intelligence to see them in advance)
and they've used them to win the war. In the present political climate any
story about any unofficial contacts between the Family/the Establishment and
the rebels could have an unpredictable and probably explosive effect on
domestic Russian politics and certainly on the elections. If it were to be
true, then there would be a very strong reason to have Borovik


Online bets on Russia's election
BBC (March 14, 2000)

Russians will be taking a gamble on their future in more ways
than one on 26 March when they elect a president for the next
four years.

In a country where betting on cards was once the national vice,
it is no surprise that people are not only voting on the outcome,
but putting money on it.

For the first time, they can even bet online, thanks to Moskovsky
Totalizator - an offshoot of a company founded by UK businessman
George Walker, who bounced back from bankruptcy by getting
Russians to bet on hound and horse races beamed from the
West by satellite.

No surprises

"Everyone prepares for the election in his own way,"
says the company's website at

"One person gets involved in campaigning ... another sits in
front of the television, or argues with colleagues. We invite
you to make money."

On the face of it, this election would seem to be useless
for betting purposes, because the winner is clear - acting
President Vladimir Putin, who opinion polls say has left
all his rivals in the starting box.

But this doesn't seem to matter to Russia's punters, who have
already deposited the equivalent of $40,000 - as much
as the company took in total during December's parliamentary

General director Konstantin Bachkala says that is just the start,
as most bets will be placed in the final days before betting
closes on 24 March.

The emphasis is also less on who will win, than on how.

Of four possible bets, two focus on the percentage of the
vote the winner will get, and the percentage of the electorate
that turns out to cast a ballot.

You can also gamble on which candidates will come in the top
four, or bet on whether or not Vladimir Putin, or the Communist
leader Gennady Zyuganov, will win in the first round. (To do this,
one of them would have to get more than half the votes cast.)

Gauging the mood

The company is not offering odds - the bet is run on the tote
system where winners get a slice of the overall pool of money
wagered. The website shows multipliers that indicate
the return you would get, on the basis of wagers placed so far,
for a bet that came up trumps.

Currently, most money has been placed on the likelihood that
the election will go to a second round, with bets for a Putin
victory in round one coming a close second. Neither bet
offers much of a return.

A bet on a victory for Mr Zyuganov in round one, however,
would bring a prize 16.5 times greater than the original stake.

Mr Bachkala is able to measure the country's political mood
by the kind of bets being placed. Some days, punters are
more sceptical than others about the chances of an outright
victory for Mr Putin.

Who's playing? "The entire middle class, from lower-middle
right up to the upper oligarchs," says Mr Bachkala, referring
to the tycoons whose huge wealth and personal connections
make them big players in Russian politics.

The online voting system means that a bet can be made from
anywhere in the world, but you must first have deposited money
with Moskovsky Totalisator either in cash, or by a transfer from
a Russian bank.

The system doesn't allow for credit-card betting so far - but
Mr Bachkala says he is working on it.


Public Russian Television (ORT) 
Sergey Dorenko’s Program 
Saturday, March 11, 2000 
[Summary prepared by 
Olga Kryazheva, Research Assistant 
Center for Defense Information]

Sergei Dorenko presented his condolences to the friends and families of
Artiom Borovik, Ziya Bazhayev, and others who died in the airplane crash on
March 10. All nine deaths are equally tragic. Dorenko noted that he met
and briefly talked to Borovik. According to Dorenko, Borovik was doing his
best to acheive peace between Dorenko and Luzhkov. Even being unemployed,
Dorenko did not use his advice, although appreciated it. 

Dorenko stressed that there were a few politicians who involved these
tragic deaths into politics and even tried to accuse the government of
possible provocation. These actions were expected from the politicians but
were not expected from the colleagues-journalists. Dorenko noted that
after decoding the information from the flight data recorder, four out of
twelve parameters were missing, but even this fact does not allow to draw
conclusions until professionals speak. 

Dorenko reported that the battles in Komsomolsk continue and called for
strengthening the security regime on the freed territories. On Sunday,
March 11, the Minister of Defense General Sergeyev presented his
condolences to the families of the Pskov Division soldiers that died in the
battle of Ulus-Kert to the South of Chechnya on Match 1. 

“Russia will defend all the soldiers of the World War II wherever they
live,” the acting president Vladimir Putin said last week. Every year in
Latvia 17,000 veterans get together to remember the victory day and the day
of Riga liberation. Dorenko has stressed that the veterans in Latvia need
material, as well as political support. Veterans say that in Latvia they
are not respected and considered occupants, they lose their privileges and
protection of the government.

According the current Public Opinion Fond Survey, 53% support Putin (54%
last week); 19% would give their votes to Zyuganov (19% last week); 4%
support Yavlinsky. Tuliyev has 2% of the public support; Titov, Govorukhin,
Pamfilova, and Skuratov each have 1% of the votes. The march of the
prostitutes in support of Yury Skuratov took place in Moscow last week. The
prostitutes hiding their faces hold slogans, such as “Yura, we are with
you!” The leader of the prostitutes’ movement stated that her colleagues
support Skuratov because he stood against the existing authorities.
Dorenko also noted that, according to the same Public Opinion Fond Survey,
the old politicians running for the presidency have a much lower level of
public trust, than the new politicians do. Dorenko briefly covered the
conflict between Zhirinovsky and Veshnyakov, the CEC director.
Zhirinovsky’s right to run for the office was finally restored. He demanded
that he be given more media time and space for his campaign and stated
that this incident was a political order of Yavlinsky and Zyuganov, who
tried to prevent Zhirinovsky from running for the office. Zhirinovsky also
stated that the laws are wrong and blamed Veshnyakov for autocracy. On his
part, Veshnyakov noted that Zhirinovsky does not obey the laws.

Next, an interview with Konstantin Titov followed. In general, Titov
supports Putin, but the acting president officially has to state that he
follows the right-wing liberal direction. Titov considers Putin’s remark
that Russia “could join NATO” not clear. Titov believes that NATO should
ask Russia first to join it, and only then “we’ll think.” He opposes the
idea of a more unitary state. In his opinion, every governor and mayor
should be elected, not appointed. Titov stated that all mayors in his
supervision are elected, and he is capable of managing large corporations. 

Saturday, March 11, the British Prime Minister Tony Blair visited St.
Petersburg with an unofficial visit. Although Putin stated that the reason
for the visit was the opening night of Prokofiev’s “War and Peace” opera in
Maryinsky Theatre, questions other then theatrical performances were
discussed. The main topic of the discussion was British investments in
the Russian economy. Both parties seemed to be satisfied with the
negotiations. Putin considers Mr. Blair “a convenient and pleasant partner.”

Dorenko reported that on March 7 two main political rivals Albert Gore and
George Bush Junior were defined for the future presidential elections in
the United States. Both rivals are heirs of famous political dynasties
of the United States. Bill Bradley decided to support Gore; John McCain has
not yet defined his position. Dorenko pointed out that Gore’s policy
towards Russia is clear, he does not intend to change the U.S. present
position. Bush’s policy is questionable: if it is helpful for his campaign
Bush will continue to follow an anti-Russia course. Dorenko presented
episodes of the Bush’s speech where he states that United States “has to
define its enemies on its own”, and “deadly weapons of Russia will be

Dorenko briefly covered the recent Social Democratic Party conference
headed by Mikhail Gorbachev. The ORT staff reported that the first Russian
reformer is not going to run for the office this year. Regarding his
relations with Putin, Gorbachev said that they are “normal, respectful, and
serious, although not completely formed.” 

The Russian actor Vladimir Steklov is getting ready for a space flight. The
purpose of this flight is making a movie on the Mir Space Station. The fifty-
two-year-old actor will be the first one to go to space on his own business.

Dorenko continues the story on criminal activities of mayor Luzhkov. Deputy
Shashurin, who was convicted of crimes for three times, states that firms
of Elena Baturina, Luzhkov’s wife, are involved in stealing of 5,000 Kamaz
trucks and exchanging them for polyester for the stadium in Luzhniki. 

Last week Dorenko received the order of February 7 from the ORT director
Konstantin Ernst obliging Dorenko to refute the court’s conformation of the
fact that Luzhkov and Tsiritelli exchanged Tsiritalli’s statue on the land
property in Spain. Dorenko’s staff interviewed Isabel Garcia Marcos, the
Andalusian deputy in charge of investigation of this case, and she
confirmed that land property was given into Luzhkov’s and Tsiritelli’s
private ownership. Luzhkov refused this gift after Dorenko’s accusation.


Source: Monitoring research in English 14 Mar 00 

[This is the second in an analytical series looking at Russian media
coverage of the campaign for the presidential election on 26th March. The
first in the series was filed on 7th March under the headline "The hidden
face of Putin as portrayed by the Russian press".] 

Acting President Vladimir Putin is receiving an unprecedented degree of
television exposure on all national channels, even on the privately-owned
NTV, which is widely regarded to be critical of his campaign in Chechnya.
On all three channels Putin is being portrayed not just as an iron leader
in charge of demolishing the remaining Chechen rebels but, above all, as an
all-round people's man, who understands what people want and how they feel
- a kind of protective father figure. His concerns lie with the unfortunate
in society - the pensioners, the war veterans, the low-income workers, the
health service and child care. In a recent Russia TV (RTV) report, for
instance, on Putin's visit to the Surgut oil field, the reporter was quick
to emphasize: "Vladimir Putin did not go to look around it but straight
away moved towards the people." 

Not only do Russians see Putin on grand government occasions, talking tough
on the economy and corruption, but they have also seen lingering shots of
him with tears in his eyes at the funeral of his former colleague, the
former St Petersburg mayor, Anatoliy Sobchak, his arm around the widow.
They have seen him awkwardly bending over an Irkutsk orphan in an effort to
bestow a kiss upon the girl's cheek. He is shown shaking hands with
bescarved babushkas and, at an official function, giving that special smile
to the Canadian foreign minister, who happens to be a woman. 

But above all, the sentimentality with which Putin is presented to the
Russian public is apparent from correspondents' comments, footage of
individual responses to Putin, and video reports featuring public adulation
of their future leader. 

"All the Vladimirs that Russia has ever had have been great - from Saint
Vladimir to Vladimir Lenin. But being Vladimir Vladimirovich, you are twice
that great," said one trade union official to Putin in an RTV report on the
acting president's visit to the Federation of Independent Trade Unions. 

Ahead of International Women's Day, all channels gave extensive coverage to
Putin's presentation of awards to Russia's prominent women. It was clearly
an occasion to show off the gentle side of the future president in a
heart-moving setting. A flamboyant elderly actress addressed Putin from the
Kremlin podium and hailed his virtues with the words: "Dear Vladimir
Vladimirovich, I have to compliment you on the way you walk. You know you
have a very proper gait. The way a man walks shows his character,
perseverance and generally his willpower. You have a very splendid way of
walking." Commenting on the event, the Russian Public TV (ORT)
correspondent commended the atmosphere in the Kremlin as being "as informal
as a party at home", while the Russia TV channel remarked: "Putin looked
gentle and moved." 

Often viewers are treated to reports which include scenes of public
admiration of the future leader. In one ORT report, Russians were made to
witness a squabble between two elderly ladies in the street. "If he worked
for intelligence, he must be clever. Our intelligence services do not
employ fools," one shouted across to the other. 

During Putin's walkabout at the textile factory in Ivanovo, broadcast by
ORT on 7th March, an elderly lady was shown pleading with the acting
president. "We are relying on you," she said, trying to grasp his hand. 

Was it a coincidence that Putin chose to receive British Prime Minister
Tony Blair in Russia's former imperial city, his native St Petersburg, and
to hold talks with him in the Throne Room of the Russian Tsar's former
residence, the Winter Palace or the Hermitage. This venue has not been used
by Russian leaders for official audiences with foreign visitors for a very
long time. But the NTV station went out of its way to emphasize the
"appropriateness of the background" to the Blair visit and suggested that
there was something symbolic in Putin's choice of location. After all,
Putin reportedly has a portrait of Peter the Great hanging in his office. 

In fact, NTV, despite occasional irreverence towards Putin on its famous
satirical puppet show, "Kukly", seems to have begun to collude at times
with the popular adulation of Putin. It was an NTV news reporter, for
instance, who described Putin's statements in Irkutsk in February as
"serious and tough", and his manner as "soft and gentle". 

Putin must feel assured of election victory on 26th March, so much so, that
he has declined to take part in the official television campaign which
opened at the beginning of this month. He said he did not need to run
advertisements for himself, as viewers were seeing enough of him already.
The Russian press has also reported he may decide not to go ahead with the
publication of an official election programme in the hope that the February
letter to the nation, outlining his views, would be sufficient. But
although Putin is no longer dependent on media tricks to boost his
popularity, he is still dependent on the media for boosting the turnout on
polling day - which some fear may not be high enough to secure his victory
in the first round. Even so, analysts believe Putin is sure to win the


Text of presidential election broadcast carried by Russian Public TV on
14th March 

[Broadcast opens with vox pop interviews with people in the streets on the
qualities the future president must possess, which also distinguish
Yavlinskiy as their choice for Russia's leader] 

[Voice-over, to archive footage of Soviet leaders plus Yeltsin in impromptu
dance on stage] What is it that makes a civilized state different from
barbarian? It is full observance and protection of human rights.
Regrettably, this main rule of a democratic state has been broken in Russia
millions of times in the past 100 years alone. How often have Russia's
powers that be taken care of universal justice and wellbeing at the expense
of the individual? Can it be that today we are ready to repeat the mistakes
of the past, and agree that the end justifies the means and that the image
of a strong state is worth the lives of its individual citizens? 

[Yavlinskiy, in a speech at a venue] The individual today is Russia's main
and only real asset that remains. A policy oriented towards the individual
is the one that can lead Russia out of a political dead end. 

Over the past eight months, Vladimir Putin and his allies from the
Communist Party have shown that they are unable to pursue such a policy. 

[Voice-over, to video of Yavlinskiy] Grigoriy Yavlinskiy is the only
representative of high political circles who has a concern for the fate of
every citizen. What is more, he is the only rights defender in Russian

[Yavlinskiy, against a map of Russia] I have a clear notion of what
constitutes Russia's or, if you wish, the Russians' national idea. It is
expressed in one word, which word is this: respect. The fact is that, in
Russia, even when three people get together to have a chat about life, they
will always raise the subject. 

It is respect for each individual, each region, each ethnic group, all
religions, our culture, our past, our future and each profession. Until the
powers that be in Russia begin to respect each and every individual and our
country as a whole, we shall not be able to realize our national idea. It
is respect that can unite everybody. 

[Voice-over, to video of Yavlinskiy at various events] It is all simple: To
protect the rights of an individual means to observe the constitution,
which is not the case in reality. Nor shall it be, unless we give our votes
at the elections to the only guarantor of human rights and freedoms in our
politics, Grigoriy Yavlinskiy, whose actions have repeatedly spoken louder
than words about his firm commitment to the principles of real democracy.
One must be very strong and principled not to be afraid to remain in a
minority and in opposition, speak against the corrupt structures of power
and invariably have one's own way. 

[Yavlinskiy] I am a persistent man. I intend not only to take part but to

[Voice-over] Grigoriy Yavlinskiy for president of new Russia as a strong
and free state. 


Koehler's Commitment to Russia Could Signal New Tone at IMF

Moscow, March 14 <(Bloomberg)
-- In early December, Horst Koehler flew to Moscow seeking answers from 
Prime Minister Vladimir Putin on more than $100 million in loans the European 
Bank for Reconstruction and Development was unable to recover. 

Koehler, tapped to take over as chief of the International Monetary Fund, 
protested the bank's treatment in Russia, and called for better protection of 
investors' rights. Then, as he left his meeting with Putin, he pledged to 
expand operations in Moscow and boost lending to Russian industry. 

Koehler's 18-month stint as EBRD president began two weeks after Russia 
defaulted on $40 billion of Treasury debt, precipitating the collapse of two 
banks in which the EBRD invested, as well as corporate loan defaults. 
Kohler's approach to Russia could bring a change at the IMF, particularly 
after this month's presidential election, which Putin's expected to win, 
analysts said. 

``One of the first tasks of the new managing director of the IMF is to 
formulate a new program for Russia,'' said Goohoon Kwon, senior economist at 
ABN Amro in London. ``There are signs that all international financial 
organizations, including the IMF and the EBRD, want to engage very actively 
with Russia under the new president, although the timing and the amount of 
financial assistance are very uncertain at this moment.'' 

The IMF suspended a $4.5 billion lending program to Russia in September 
following allegations of Russian money laundering through U.S. banks and 
Western criticism of the war in Chechnya. Russian officials complain that IMF 
requirements recently have become a moving target. Kohler may help resolve 
that problem, said some analysts. 

`Changing Focus' 

Koehler ``helped change the focus at the EBRD - towards having more dialogue 
with emerging market economies and more emphasis on conditionality'' of 
loans, said Sonja Gibbs, chief strategist for Eastern Europe at Nomura 
International in London. ``In many ways, this is the type of organizational 
change the IMF needs.'' 

Even as Russian economic growth accelerates -- fueled by the ruble 
devaluation and soaring world commodity prices -- tax collection rises and 
the budget posts a surplus, the IMF also has said Russia has yet to meet 
specific targets on reducing barter, improving bankruptcy laws, and other 

In previous statements, Koehler has underlined the importance of Western 
financial assistance in Russia. 

``Regardless of who will be the head of the fund, its involvement in Russia 
will be driven exclusively by its huge exposure there,'' said Erik Nielsen, 
senior economist at Goldman, Sachs & Co. in London. ``The fund is a very 
different animal to the EBRD because it's much more of a policy-led 

The EBRD, set up in 1991, has a mandate to foster private business 
development across the former East bloc. 

Nomination Imminent 

Koehler, expected to be nominated today by the European Union for the IMF 
job, took over at the EBRD in September 1998, just after Russia defaulted on 
its Treasury debt and gave up its defense of the ruble, which subsequently 
fell more than 75 percent against the dollar. 

The 57-year-old EBRD chief previously served as president of the German 
Association of Savings Banks and was Germany's undersecretary of Finance 
between 1982 and 1990. 

Aside from the question of future lending to Russia, the change in IMF 
leadership could influence negotiations between Russia and government 
creditors, represented by the so-called Paris Club, on billions of dollars in 
Soviet-era debt, analysts said. 

`Neutral News' 

Koehler's nomination is ``neutral news for Russia,'' said Margot Jacobs, an 
analyst at Moscow-based brokerage United Financial Group. ``Having a German 
head up the IMF would give effectively Germany more weight in Paris Club 
negotiations, which may make them more complicated.'' 

In his brief tenure at the EBRD, Koehler has had extensive experience with 
defaulted loans. 

The EBRD lost about $40 million from investments in two Russian banks, 
Tokobank and Inkombank, both among Russia's top 20 banks before the default 
and devaluation. A $35 million loan to oil producer OAO Chernogorneft became 
part of a court battle after the unit was sold to OAO Tyumen Oil Co. in a 
bankruptcy auction, which Koehler described as a ``sham.'' 

Tyumen since has reconciled differences with Chernogorneft's former owner, 
OAO Sidanco, a company partly owned by BP Amoco Plc, which would put the 
subsidiary back under Sidanco's control. 

The bank also has had troubles with OAO KamAZ, a truckmaker that owes the 
EBRD $100 million, and OAO Gorkovsky Avtomobilny Zavod, a carmaker that has 
proposed the EBRD take a stake in exchange for payments on a $65 million 

EBRD Vice President Charles Frank said yesterday in Moscow that private 
investment is poised to flow back into Russia ``but only if investors begin 
to believe it is safe to invest and operate in Russia.'' 

Increased Lending 

The bank plans to step up lending to Russia to as much as $750 million from 
$220 million last year, news agency Interfax reported in January, citing 
Frank. Total annual financing could reach 1 billion euros ($963 million) by 
2003, Koehler has said. 

This year's plans include possible loans to OAO Severstal, Russia's biggest 
steelmaker, several gold mining companies, OAO Lukoil Holding, Russia's No. 1 
oil producer, and RAO Unified Energy Systems, the monopoly power company, 
Interfax said. 

Under Koehler, the EBRD reported a profit in 1999 after a loss the previous 
year. Colleagues attributed the 43 million euro profit last year in part to 
Koehler's conviction the Russian crisis would pass and his refusal to scale 
back projects in Eastern Europe. 

``As to whether he'll ultimately be successful - well it's a big job,'' said 
Nomura's Gibbs. ``Arguably, the IMF needs a dynamic, larger-than-life, 
inspirational figure to turn the entire organization around. The jury will be 
out for some time. 


Putin Faces Challenge of Economy
March 14, 2000

NOGINSK, Russia (AP) - Acting President Vladimir Putin, expected to sweep 
March 26 elections, has vowed to rescue Russia's dying industries and revive 
its economy, but his plans so far are vague. 

This struggling textile town, once a showpiece of the Soviet era, symbolizes 
the enormous task Putin faces: Residents now struggle to make marginal 
livings - among them, Yulia Smagina, peddling cheap jeans made in Turkey. On 
a good day, she might clear $10. 

In Noginsk, factories that once provided jobs for everyone are struggling to 
stay alive after almost 10 years of recession. 

And Smagina, 28, doesn't expect things to improve after the election of Boris 
Yeltsin's successor. 

``I'm not even going to vote,'' said Smagina, an accountant by training. 
``They're going to elect Putin. And he has the same policies as Yeltsin.'' 

In Noginsk, 30 miles east of Moscow, the economy is stalled between the 
failed Soviet system of central planning and the flawed efforts of the past 
decade to build a market economy. 

There, factories chug along with outdated equipment and little investment, 
not paying suppliers or doing barter deals. Local officials let factories pay 
taxes late and public utilities don't cut them off for not paying bills. The 
goal is to keep people employed. 

``When industry works, there's enough for all,'' says Vladimir Laptev, head 
of the local administration and a former Communist official. 

But economists say the web of informal subsidies in Noginsk is simply a 
rickety continuation of the Soviet system, and it is falling apart just as 
surely as the old central-planning system did. 

International financial organizations like the International Monetary Fund 
want Russia to make more progress on switching to a market economy, but the 
old ways have strong support in Noginsk and hundreds of cities and towns like 
it across Russia. 

Lev Subbotin, director of the 80-year-old, 570-worker Azhur stocking factory, 
says foreign advice on restructuring bankrupt, inefficient Russian 
enterprises misses the mark. 

``We could lay people off,'' Subbotin said over the clatter on the factory 
floor, where harried-looking women operated sewing machines. ``But people 
have to eat.'' 

For all the talk of saving jobs, the local factories have steadily laid 
people off as the economy has crumbled. The workforce at the town's 
industrial centerpiece, the Glukhovsky Textile Plant founded in 1842, has 
fallen from 14,000 to 4,000 in the past decade. Many of the workers who still 
have jobs have sometimes gone weeks, even months, without being paid. 

Officially, unemployment in Russia is running at 12 percent, but the real 
rate is thought to be much higher. 

As industry shrinks, many of Noginsk's 123,000 residents have turned to 
selling vegetables or peddling cheap goods in the open-air market. They get 
by - thanks to government-subsidized apartment rents as low as $5 a month and 
garden plots to grow their own food. 

``This is what we've depended on for the last three years,'' says Vera 
Petrova, 55, a pensioner waiting in line to turn in empty bottles for 4 cents 
apiece. ``If you have a brain and hands you can live.'' 

Economists say sweeping market reforms are vital if the economy is ever going 
to prosper. A host of problems must be tackled, including a byzantine tax 
system, a weak legal system that can't enforce contracts, criminal gangs that 
prey on small business, and official corruption and red tape. 

In addition, the most valuable companies - particularly lucrative oil and 
mining enterprises - were grabbed by politically connected insiders in highly 
dubious privatization deals during the Yeltsin years. 

Putin has been vague on his economic plans, giving conflicting signals by 
saying he wants to continue market reforms, but increase state controls. 
Aides say the acting president is still working on an economic program that 
might be ready before the election. 

Some analysts say Putin might take limited steps in his first six months, 
such as pushing tax reform through parliament, then turn to more difficult 
tasks, such as developing new industries. 

But ``the really tough things I don't think he's going to do until he 
consolidates his power,'' said Roland Nash, chief economist at Moscow-based 
Renaissance Capital investment bank. 



MOSCOW. March 14 (Interfax) - Russian Security Council Secretary
Sergei Ivanov has criticized the West for taking discriminatory actions
towards Russia on the world's markets.
"Russia needs solid international support for its reforms, but in
fact, unfortunately, things turn out just the opposite," Ivanov said
addressing the students and personnel of the Moscow State Institute of
Foreign Relations on Tuesday.
"Ninety-nine anti-dumping restrictions on Russia are in force all
around the world," because of which Russia annually makes from $1.5-2
billion less than it would otherwise, Ivanov said.
Russia's joining the World Trade Organization is being made
conditional upon "discriminatory requirements," and the extension of
loans is being made contingent on political terms, the Security Council
Secretary charged.
In this connection, the country's leadership is tasking its foreign
policy agencies with protecting the interests of major Russian
manufacturers on world markets, regardless of their form of ownership,
Ivanov went on.
As a result of these restrictions, the Russian industry is becoming
more and more oriented towards the domestic market, the secretary said,
adding that in developing the country's economy, "we do not intend to
rely on a sugar daddy."
On the other hand, he said, Russia will not revert to a policy of
In the next two years, a number of crucial laws to attract
investment to Russia will be passed, and these laws "will encourage the
Russian investor" first of all, Ivanov said.
"If we stem the flow of capital abroad and the Russian investor
begins to invest money in the domestic economy, this would be a signal
to Western capital as well," the Security Council secretary said.


The Independent (UK)
15 March 2000
[for personal use only]
In the footsteps of Catherine the Great, a woman makes a bid for power 
By Helen Womack 

"If only there was a woman we could vote for. The men have made quite enough 
of a mess in this country with their aggression, their drunkenness and their 
corruption. A woman could hardly do any worse. I would give her a chance." 

The speaker was Pavel, a middle-aged man. If he thought in that way, imagine 
how the millions of still-downtrodden Russian women felt after all the 
disappointments of Boris Yeltsin's flawed rule. Now, with two weeks to go to 
presidential elections, they have a woman for whom they can vote. The 
electorate has plenty of choice, although, because of Chechnya and the way 
the establishment has backed him, the acting president, Vladimir Putin, has a 
huge advantage in the ballot on 26 March. There are 11 other candidates, 
among whom is the first woman to run for the Russian presidency, the liberal 
reformer and former social affairs minister Ella Pamfilova. If she won the 
Kremlin, she would be the first woman to rule Russia since the Empress 
Catherine the Great. 

Last Tuesday, on the eve of International Women's Day, Ms Pamfilova held a 
press conference to launch her campaign. Elegant in black velvet, avoiding 
any suggestion of strident feminism, she called for "capitalism with a human 
face", as in 1968, the doomed Czechoslovak leader, Alexander Dubcek, 
advocated "socialism with a human face". 

Ms Pamfilova said: "We should not be thinking of reversing privatisation, but 
in the process of market reform, we have not cared enough about human beings. 
This has led to national degradation and a sense of hopelessness. 

"We must invest in job creation, education and science. If our social decline 
continues, no amount of military might will save us. Russia is a rich country 
and we simply do not have the right to live as poorly as we do now." All of 
which would be music to the ears of the middle classes, reduced to poverty 
under Mr Yeltsin. Ms Pamfilova, 46, an electronics engineer, entered politics 
in 1989 when the last Soviet leader, Mikhail Gorbachev, allowed some 
independent MPs. 

After Mr Yeltsin defeated the coup in August 1991, Ms Pamfilova joined his 
first government as minister for social affairs. But while the nowretired 
Russian leader allowed power to corrupt him, Ms Pamfilova remained loyal to 
her ideals. Today she lives in a two-room flat with her husband, daughter, 
son-in-law and granddaughter. It was the first war in Chechnya from 1994-1996 
that prompted Ms Pamfilova to go into opposition. At the State Duma elections 
last December, she lost her seat as the "bears" of the new Unity party packed 
parliament to support Mr Putin. 

Ms Pamfilova admitted she has virtually no chance of winning but said she had 
reason to hope for third or fourth place, which might inspire younger Russian 
women. Pavel said he would be voting for Ms Pamfilova, at least in the first 
round. But the women of Russia were all going weak at the knees about Mr 
Putin, described by one Russian actress last week as a "real man". On Women's 
Day, the acting president adopted his softest "father of the nation" tone of 
voice when he said that Russian women were held back in many ways but had one 
advantage, "their absolute right to be protected by men". 


Web page for CDI Russia Weekly:

Return to CDI's Home Page  I  Return to CDI's Library