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Johnson's Russia List


June 15, 2000    
This Date's Issues: 4368  4369

Johnson's Russia List
15 June 2000

[Note from David Johnson:
1. Moscow Times: Andrei Zolotov Jr., NTV Chief's Arrest Provokes Storm.
2. Argumenty i Fakty: OUR LIFE FOR THE PAST 30 YEARS. (DJ: Lots of 
very intereseting statistics)
3. Jerry Hough: Re: 4367-More on Gusinsky.
4. Ed Crane: Gusinsky.
5. Jacob Kipp: Tsar's and Commissars travel.
7. Moscow Times EDITORIAL: Yes, It's an Assault on Freedoms.
8. Gusinsky`s Detention Caused Doubts. (Text of oligarchs'
letter re Gusinsky)
9. Missing Points From Strategic Development Plan.
10. Moscow Times: Simon Saradzhyan, Scandal Comes at Bad Time for Putin.
11. Los Angeles Times: Richard Paddock, A Campaign of Terror in the Name of Fighting It. Uzbekistan says brutality is necessary to quash Islamic extremism,                                                      but critics say the repression is backfiring.] 


Moscow Times
June 15, 2000 
NTV Chief's Arrest Provokes Storm 
By Andrei Zolotov Jr.
Staff Writer

A wide range of political figures Wednesday demanded an explanation for the 
arrest of NTV television owner Vladimir Gusinsky and urged that he be freed 
from prison immediately. 

Gusinsky's associates said they believed the arrest had been approved by 
President Vladimir Putin, but many political leaders showed a willingness to 
give the president the benefit of the doubt. Some said they saw the hand of 
presidential Chief of Staff Alexander Voloshin and other holdovers from the 
Boris Yeltsin era behind the arrest and demanded they be punished. 

Putin, who was on a state visit to Madrid on Wednesday, said the decision to 
arrest Gusinsky was made independently by the Prosecutor General's Office and 
he promised to look into it when he gets back to Moscow at the end of the 

"Naturally, if there have been violations of the law, all those who allowed 
themselves to break the law will face an appropriate response from the 
president," Putin said. 

Gusinsky was being held in a three-man cell in the Butyrskaya Prison, which 
Justice Ministry official Gennady Lisenkov said was a "privileged situation" 
in the notoriously overcrowded prison. His two cellmates are "dignified 
people" f a counterfeiter and another man charged with economic crimes f and 
there is a television in the cell, Lisenkov was quoted by news agencies as 

Gusinsky's lawers, Genry Reznik and Pavel Astakhov, were allowed to meet with 
him in the morning and were with him later in the day for a 
three-and-a-half-hour interrogation. 

Reznik told reporters that it could not be properly called an interrogation 
because investigators had trouble formulating their accusations. 

"We were finally convinced that the investigators are carrying out a 
political task," Reznik said on NTV. 

Vladimir Lyseiko, chief of the Prosecutor General's Office special cases 
investigation department, which is handling the case, said formal charges 
will be filed against Gusinsky within 10 days of his arrest, as required by 

Otherwise, he would have to be released. 

Gusinsky's lawyers said they would file formal complaints Thursday protesting 
the arrest and requesting he be freed under the condition he not leave 

Gusinsky's associate, NTV general director and leading anchor Yevgeny 
Kiselyov, said he believed Putin was aware of plans to arrest Gusinsky. 

"Not a single sane prosecutor would decide to arrest a public figure and 
businessman like Vladimir Gusinsky independently, without consultations with 
the very top officials," Kiselyov said at a news conference. "If they decided 
in the Kremlin to tighten the bolts all the way down and establish an 
authoritative dictatorship, then everything fits into place. But how they are 
going to do this in today's interdependent world, I don't know." 

Putin said Wednesday morning that he had little information about the case 
and could not get in touch with Prosecutor General Vladimir Ustinov. Later in 
the day, the president said he had received full information about the case. 

He downplayed the importance of the Russkoye Video case, which the 
prosecutor's office said was the basis for detaining Gusinsky. But he 
demonstrated a remarkable knowledge of Gusinsky's personal and business 
affairs, particularly his Media-MOST holding company's relations with 
Gazprom. The natural gas monopoly has guaranteed and repaid Gusinsky's debts. 

"I don't understand why Gazprom has to spend money on this problem," Putin 

Gusinsky's deputy, Igor Malashenko, also arrived in Madrid on Wednesday, but 
he was barred from holding a news conference in the Ritz hotel, where Putin 
was staying. Speaking to reporters at another hotel, Malashenko blamed 
Voloshin and other Kremlin insiders from the Yeltsin era of waging "war 
against independent media." 

"Their goal is to build an authoritarian regime in Russia," Malashenko said. 
Putin, he said, is a "hostage" of these people, who brought him to power, and 
the question is whether he will be able to free himself from their influence. 

Moscow Mayor Yury Luzhkov also named Voloshin publicly and said the arrest 
was a "test of society's reaction to repressions." He said Gusinsky should be 
released, offering to take his place in prison if he should flee the country. 

Mikhail Gorbachev condemned Gusinsky's arrest as an attack on the free press 
and suggested that a Kremlin plot could be behind it. He said "old forces" 
and "clans" in the Kremlin where working behind Putin's back to undermine him 
while he was traveling abroad. 

Putin should return to Moscow and "drive away those who are allowing this to 
happen," Gorbachev said at a news conference. 

Four factions in the State Duma f the Union of Right Forces, Yabloko, 
Fatherland-All Russia and Russia's Regions f also demanded Gusinsky's release 
and asked Putin to clarify the situation. 

"We have no grounds not to believe Putin when he says he had not known about 
preparations for the arrest," the statement said. "But then another question 
arises: Who is interested in splitting society exactly at the time when the 
president of Russia is carrying out such important reforms?" 

Faction leaders told reporters they may reconsider their support for Putin's 
bills changing the tax system and federation structure. 

The Communist Party refused to join the statement. Party leader Gennady 
Zyuganov said he ordered his Duma faction to draft a request to the 
prosecutor's office for a clarification of Gusinsky's arrest. Zyuganov also 
said there was no "special need" to put Gusinsky in jail. 

But Duma Speaker Gennady Seleznyov, a Communist, backed the prosecutor's 
decision. He denied the arrest was connected with an attack on free speech 
and said prosecutors had grounds for arrest. "The prosecutor's office has 
weighed everything not 10 times, but 100 times before deciding to arrest 
Gusinsky," Seleznyov said. 

Several media associations and Jewish organizations expressed their outrage 
in statements and letters to Putin. 

Eduard Sagalayev, president of the National Association of Broadcasters, said 
in a statement that his organization has previously been reluctant to condemn 
the Kremlin for pressuring Media-MOST, wanting to give Putin the benefit of 
the doubt. 

"What happened now changes the picture radically," he wrote. "Gusinsky's 
arrest removes the veil of ambiguity from the actions of the authorities. It 
is absolutely clear that they are trying to throw us back to a society in 
which political liberties and dissidence are considered a punishable crime." 

The Russian Union of Journalists and the Vienna-based International Press 
Institute also condemned the media executive's arrest. 

Alexander Osovtsov, vice president of the Russian Jewish Congress, said at a 
news conference that the congress, which is led by Gusinsky, would consider 
"acts of civil disobedience" such as rallies and hunger strikes to protest 
the arrest. 

Jewish leaders said that although Gusinsky was arrested as a media boss, his 
arrest also could be seen in the context of anti-Semitism. "It doesn't work 
to separate the two," Osovtsov said. "As soon as some group is unleashed to 
attack a Jewish leader for professional reasons, there will be other groups 
who will perceive it as purely biological [anti-Semitism]." 

The World Jewish Congress, other influential Jewish organizations and Israeli 
politicians also expressed their support for Gusinsky. 

The Prosecutor General's Office issued a statement protesting what it said 
was "unprecedented pressure" from the mass media. 

Gusinsky's lawyers, the statement said, have become part of a "mass campaign, 
in which some journalists shamelessly misinterpret facts and ignore not only 
legal, but professional ethics." 


Argumenty i Fakty
No. 23
[translation from RIA Novosti for personal use only]

1970 1975 1980 1985

National wealth
(roubles, US dollars) no data 1,643 bn rbls 2,230 bn 
or $2,489 bn or $3,379 
Population (mn people) 130.6 134.5 138.8 143.6 

Life span (years) 68.9 68.1 67.6 69.2 

Pensioners (mn people) 20.2 21.5 23.1 25.6 

Number of suicides 
(number of people) data closed 48,195 44,562 

Youth under 30 years 
of age (mn people) 63.6 66.6 67 66.4 

(per thousand people) 10.1 11.1 11.1 9.7 

(per thousand people) 3.0 3.6 4.3 4.0 

people who arrived no data 876,371 877,131 

people who left no data 780,650 705,080 

Number of functionaries 
(thousand people) 1,060 1,101 1,147 1,204 
Vodka sale per capita 
of the population 
(bottles per year) 25.3 28 30 23.5 

Export (countries
outside CIS, $bn) 36 36 38 57.6 

Import (countries 
outside CIS, $bn) 27 21 109 56.4 

Part of incomes owned by 
20% of the most poor (%) 7.8 9.5 10.1 10 

Part of incomes owned by
20% of the most rich (%) 36.8 33.8 33.4 34 

Part of incomes used for 
savings and foreign 
currency purchase (%) 4 4.5 2.7 4.4 

Housing (sq.m. of 
floorspace per 1 person) 11.1 12.2 13.3 14.4 

Number of telephones (mn) 6.5 9.8 13.5 17.6 

Population without 
possibility to receive 
TV programmes (%) no data 13.4 7.3 

(per thousand people) 5.5 15.3 30.2 44.5 

Number of citizens who
went as tourists to 
far abroad countries
(thousand people) no data 

1990 1995 1998

National wealth 2,728 bn rbls 5,432,442 bn rbls 17,048 bn 
(roubles, US dollars) or $4,130 bn or $1,171 bn or $689 
Population (mn people) 148.2 147.6 146.3
Life span (years) 69.2 64.6 67
Pensioners (mn people) 28.2 30.2 30.5 
Number of suicides 
(number of people) 39,150 60,953 97,276 
Youth under 30 years 
of age (mn people) 65.8 62.2 60
(per thousand people) 8.9 7.3 5.8
(per thousand people) 3.8 4.5 3.4 
people who arrived 913,223 842,050 495,304
people who left 729,467 339,600 216,691
Number of functionaries 
(thousand people) 1,602 1,893 2,777
Vodka sale per capita 
of the population 
(bottles per year) 18 38.4 29.6
Export (countries
outside CIS, $bn) 71.1 65.6 58.9
Import (countries 
outside CIS, $bn) 81.8 44.1 45.4
Part of incomes owned by 
20% of the most poor (%) 9.8 5.5 6.2
Part of incomes owned by
20% of the most rich (%) 32.7 46.9 47.4
Part of incomes used for 
savings and foreign 
currency purchase (%) 7.5 20.2 13.7
Housing (sq.m. of 
floorspace per 1 person) 15.7 17.8 18.7 
Number of telephones (mn) 23.4 26.8 30.0
Population without 
possibility to receive 
TV programmes (%) 2.1 1.2 1.1
(per thousand people) 58.6 93.3 122.0
Number of citizens who
went as tourists to 
far abroad countries
(thousand people) 1,577 (1993) 2,555 3,251

The Table gives data from the time of developed socialism to
the present troubled capitalism. For all these years we have 
going unswervingly along the paths of reforms to the bright
future. Now, in the new millennium, we can look back and analyse
the way we have gone by. 
Prepared by Sergei MAKSIMOVICH


Date: Wed, 14 Jun 2000 
From: "Jerry F. Hough" <>
Subject: Re: 4367-More on Gusinsky

It seems to me that we need to keep the structure of power 
clearly in mind in Russia. Gusinsky and MOST were always Luzhkov's 
bagmen. Luzhkov had the temerity to run for president. As I 
understand it, there is also a big corruption campaign in Samara where 
Titov had the temerity to run for president. In the 1990s, shots across 
the bow were the way that wayward children were punished in the 
Russian system, not anything seriously long-lasting. Luzhkov has kept 
control of Moscow and has been part of the checks and balances, and seems 
unlikely to be removed unless something big has changed. If there is a 
chairman of the Union to be selected, he needs independent foreign policy 
advice. A long-time Primakov friend has been appointed director of 
IMEMO, and Primakov would be a good "Central Committee secretary for 
international relations" with IMEMO's help to counterbalance MID. 
But we will see.

The crucial point for political scientists to understand is that 
democracy does not just mean "free elections." In elections, voters 
must choose between several choices. The essence of democracy is that 
they arise more or less autonomously and move to the center to try to be 
responsive to the public. If the choices can be seriously restricted by 
intimidation, as occurred in 1995-1996 and then 1999-2000, if serious and 
experienced challengers cannot get money and media attention, it is not 
democracy. We are talking about the liberal authoritarianism of George 
III in England or Bismarck in Germany or Nicholas II, all of which had 
partial electoral systems. We need language like "authoritarian 
democracy" to recognize this. To focus now on the restoration of the 
"pre-Putin democracy" and the "pre-Putin free media" instead of the need 
for a new economic policy is just part of the game of those who do not 
want a new economic policy and who want a circus to provide the focus 
of attention.


Date: Wed, 14 Jun 2000 
From: Ed Crane <>
Subject: Gusinsky

Ed Crane, Academy on Civil Society 

Recently I suggested we assess Putin's actions and inclinations in a
disciplined way, considering his real options. Thus, his initiatives on
federalism (governance, the state) may be debatable, but media intimidation
(citizens, freedom) are not. The Gusinsky arrest seems to provide strong
evidence of a neo-Stalinist regime taking place, contrary to my hopes. Are
we now going to debate Putin's real options when he returns from his
present travels, when he declares surprise, and when his Government states
it will not intervene (direct a proper approach)? I doubt that this is a
debatable issue. This has become a regime dedicated to eliminating the
long-suffering of its master. Dangerous. Now he has a real option, to send
a clear message that this is not the way things will be done. Let us see
what he will do.


Subject: Tsar's and Commissars travel
Date: Wed, 14 Jun 2000 

Dave Stone is quite right. Russia's rulers from Peter I traveled and knew
the world. In addition to those named by David, let me add Alexander I who
visited his relatives in German kingdoms, Vienna for the Congress, Paris,
and London. Nicholas I traveled frequently to Prussia and the German
kingdoms. So did Alexander II and III. Imperial Russia was not the hermit
kingdom but part of dynastic Europe. As for Soviet leaders Lenin lived
abroad before coming to power as did Trotsky. Stalin traveled less but he
did make it Tehran and Potsdam. Khrushchev was a first-class world traveler
in a politburo team or alone. He was the first Russian/Soviet leader to
visit the United States. Brezhnev traveled when he was in good health.
Andropov had been an ambassador to Hungary before takiing over KGB.
Gorbachev traveled extensively. So, if fact, did Yeltsin before his
election and after -- not often quite so successfully as others but
certainly with global attention.


Text of report by Russia TV on 14th June 

[Presenter] At this very moment Vladimir Putin, who is paying an official 
visit to Spain, is holding a news conference in Madrid. The conference hall 
of the Ritz Hotel is literally packed out with journalists. Everybody is keen 
to hear Putin's reaction to the latest events in Russia. Prior to that, the 
president met representatives of Spain's business elite. Here too he was 
asked awkward questions. Andrey Rumyantsev has the details. 

[Correspondent] The scandalous events in Russia have not yet affected either 
the timetable or character of Vladimir Putin's visit to Spain. This morning 
125 businessmen discussed investment with the Russian leader and, as Putin 
put it, they smiled mysteriously. 

[Putin] Western businessmen tend to say they like the Russian economy but 
they like all the other things less, smiling mysteriously as they do so. Some 
people here are smiling in exactly the same way. I can tell you that all the 
rest is a manifestation of the state's weakness, the state's failure and 
inability to guarantee those rules and laws which it proclaims. 

[Correspondent] Here too the president explained the situation with the 
arrest of Vladimir Gusinskiy. Putin was unable to get in touch with 
Prosecutor-General [Vladimir] Ustinov, who is not in Moscow at the moment. So 
the president is familiar with only some aspects of the criminal case on the 
basis of which Vladimir Gusinskiy was arrested. 

[Putin] At the moment I don't know any more than you about the reason for the 
arrest. However, it is connected with - this reason is connected with the 
Russian Video firm. To be honest with you, I really don't know the details. I 
know that several people have already been arrested in the case relating to 
this firm. I know one of them personally. This is the St Petersburg 
businessman Dmitriy Rozhdestvenskiy who has been detained in custody for over 
a year, I believe. In general, I do not think he is such a dangerous person 
that he has to be kept behind bars. But the prosecutor's office has different 
views on this. The prosecutor's office is entitled to take decisions within 
the law, as it sees fit. Without doubt, after my return to Moscow I will 
certainly get information on all the aspects of this case, and naturally if 
there are any infringements of the law, all those who permitted them will 
face an appropriate reaction from the state. 

[Correspondent] Vladimir Putin is well acquainted with the business side of 
the arrested entrepreneur's activities and he spoke in detail about 
Gusinskiy's relationship with Gazprom. 

[Putin] Mr Gusinskiy is a very talented person. Lately, according to reports 
in the press - and I wish to stress this - he borrowed over 1.3bn US dollars 
for his business, in the form of credit. But he has paid almost none of this 
back. He borrowed a great deal of money under a guarantee from Gazprom. Where 
is Gazprom and where is media magnate Gusinskiy in this? Why should Gazprom 
concern itself with this problem? A few weeks ago he failed to make another 
repayment, amounting to 200m US dollars. Once again he took advantage of a 
carefully crafted system of guarantees. Once again Gazprom paid 200m dollars 
on his behalf, the money which he had borrowed and failed to pay back. 

[Correspondent] Afterwards, the president headed for the Spanish parliament. 
Here he received a small present from the speaker of the Congress [of 
Deputies], Mrs Rudi - a copy of the Spanish constitutions of 812 and 1978 in 
the form of a woman's powder compact. Responding to this present, the Russian 
president said it reflected the role of women in history. 

[Former prime minister] Yevgeniy Primakov is a member of our delegation. He 
was sitting next to the president during the talks in the Congress. This 
morning Primakov discussed the latest news from Moscow with the head of 

[Primakov, leader of Fatherland - All Russia faction in State Duma - 
captioned] In general, if the prosecutor's office is waging some kind of 
struggle against illegal manifestations and conducting this struggle in a 
lawful way, there is nothing to be discussed. But if this is taking place in 
ways similar to what happened with Gusinskiy - this outraged me greatly. By 
doing this, they quite obviously wanted to shock society, to intimidate it 
maybe, I don't know. All this is part of a pattern of activity directed 
against the president. I am sure of this. 

[Correspondent] From the Congress Vladimir Putin headed off to meet the 
Spanish prime minister, Jose Maria Aznar. This is the last item on Putin's 
programme in Madrid. 

This is Andrey Rumyantsev, Tatyana Aldoshina, Dmitriy (?Aginfeyev) and Sergey 
Cherkasov reporting for "Vesti" from Madrid. 


Moscow Times
June 15, 2000 
EDITORIAL: Yes, It's an Assault on Freedoms 

"There are businessmen who live parasitically on state budget funds, on 
favorable credits, on exceptions from federal legislation f in other words, 
who live off the redistribution in their favor of the resources of others f 
of the state. þ Some of them are trying to use the wealth they have gained in 
this manner to increase their influence over the state, and also over all of 
society. We must fight these businessmen without mercy." 
-- President Vladimir Putin, in an interview last week with Die Welt am 

"I am alarmed [about Vladimir Gusinsky's arrest]. I have tried to get in 
touch with the prosecutor general, but so far I have not been able to do so. 
According to our legislation, the prosecutor general is not subordinate to 
either presidential or government structures f it is an absolutely 
independent power base. I have neither the possibility nor the right to 
influence the decisions of the prosecutor. There is a legal method for 
dealing with such questions f through the courts." 
-- President Putin this week in Spain 

We are also alarmed about Gusinsky's arrest f and we are not reassured by the 
president's words. We simply can't believe the president can't get in touch 
with the prosecutor. As to the prosecutor being so nobly independent, we wish 
it were so: Others, from Mikhail Gorbachev to Mayor Yury Luzhkov, are 
alleging that the prosecutor is actually acting under improper Kremlin 
influence. That seems likely: There has already been too much 
Kremlin-approved harassment of NTV, and of journalists in general, for Putin 
to pretend he is not an actor behind Gusinsky's arrest. 

To note this is not to embrace Gusinsky himself. He has hired odious people 
from the former KGB to provide his security and has built his media and 
banking empire on insider deals at public expense. To create NTV, he lined up 
soft loans from state banks and wangled cut rates for broadcasting nationally 
f in return for providing enthusiastic agitprop backing for Boris Yeltsin's 
1996 re-election. It was a deal with the devil f as Gusinsky himself stated 
at a news conference two weeks ago. 

"Unfortunately, I was part of the team that in 1996 gave birth to this 
system," Gusinsky said then. "Believe me, today I have to a large extent 
reassessed this process. If I could step into the same river twice, we would 
have behaved the same during the 1996 elections as we behaved in 1999 and 
2000. But unfortunately, time only flows one way." 

Now Gusinsky is in the miserable Butyrskaya Prison. We are told that he only 
shares his cell with two other inmates, and are told that this is fair, 
because, as the Cabinet so eloquently put it this week, "We have no separate 
rules or laws for þ one of the leaders of the World Jewish Congress." By such 
truculent logic, if Gusinsky were to contract drug-resistant tuberculosis 
while he awaits trial for months, as do so many others incarcerated here, the 
Cabinet could congratulate the nation on its impartial justice. 

Some are now asking, anxiously, what signal the Kremlin is sending. But it 
seems likely we are beyond signals. The Kremlin is removing critics. As the 
press minister said nearly a year ago, a crucial task of the new era is "the 
defense of the state from the free mass media." That defense is well under 
way. Those who argue otherwise f that this is about "corruption fighting" f 
are in denial, or worse. 

Then again, we could always posit "a good tsar" and a bad adviser f the 
Rasputin-like Alexander Voloshin. Many are clutching at this straw, at least 
publicly. It has the advantage of offering Putin a facesaving way out: If he 
wants to back down, he can always blame Voloshin f and let NTV off the hook 
for a while. 


June 14, 2000
Gusinsky`s Detention Caused Doubts
On Wednesday, Russia’s 18 leading businessman gathered at the office of
Alfa-Bank to discuss the situation surrounding the detention of Vladimir
Gusinsky, head of Media-MOST holding. The “oligarchs” resolved to give
personal guarantees for Gusinsky`s appearance in court and “proper
Here is the text of the appeal that was approved by the meeting and signed
by the cream of the Russian business elite. 

To the Prosecutor General of Russian Federation Mr. V.V. Ustinov 

Dear Vladimir Vasilievich! 

Until yesterday we believed that we were living in democratic country, but
today we have serious doubts. Vladimir Gusinsky`s arrest is the reason for
these doubts shared by all businessmen in Russia without exception as well
as by the foreign business community. 

Business circles have an ambiguous attitude towards Vladimir Gusinsky. We
have no doubts that the law enforcement authorities could have serious
questions concerning his activities, as it can be applied to any
substantial and successful businessman in Russia. We also recognise that
the authorities have the full right and duty to impose very harsh
preventive measures towards anybody. Anybody, but not Vladimir Gusinsky. 

Today his name is synonymous with the critical approach towards the
authorities and a symbol of opposition independent mass media. In a
democratic society the attitude towards such symbols can only be absolutely
correct and pronouncedly unprejudiced. But the fact is, we live in Russia a
country with a short tradition of democracy. The fragility of Russian
democracy received weighty confirmation yesterday. A precedent has been set
that seems to be the authorities` cruel punishment of a political opponent.
This precedent can be replicated in cases against opposition activists of
regional and organisational scale. And we could all be described as
opposition, practically all the business community. 

We hope that the authorities will find the courage to assume the fact that
Vladimir Gusinsky does not pose such a social threat that even when court
proceedings are taking place, he must be isolated from society behind
prison walls. We are sure that Vladimir Gusinsky is ready to collaborate
with the investigators and will not obstruct the fulfillment of justice. If
our opinion is worth something to you, we are ready to give our guarantees. 

Personal Guarantee 

In accordance with article 94 of the Criminal Proceedings Code, the
undersigned guarantee proper behavior and appearance of Gusinsky Vladimir
Alexandrovich, suspect or accused, at the summons of an inquiry officer, an
investigator, a prosecutor or court. We are aware of the essence of the
case in connection with which the punitive punishment has been
administered, and of the responsibility in case a suspect or a convict
commits an act, in prevention of which a punitive punishment in the form of
personal guarantee is meted out. 


V.O.Potanin, President, AO Interros
A.B.Chubais, Chairman of the board, RAO UES of Russia
V.S.Lisin, Chairman of the board of directors, NLMK
M.M.Fridman, Chairman of the Council, Alfa-group Consortium
P.O.Aven, President, Alfa-bank
V.F. Vekselberg, General director, OAO Sual
K.A.Bendukidze, General director, OAO Uralmashzavody
M.B.Khodorkovsky, Chairman of the board, NK Yukos
A.M.Karachinsky, President of IBS group
D.B.Zimin, General director, AO Vympelkom
A.R.Kokh, General Director, Gazrpom-media
A.A.Mordashev, General director, OAO Severstal
V.P.Evtushenko, Chairman of the board of directors, AFK Sistema
V.L.Mashitsky, Chairman of the board of directors, President of
Rosinvestneft Group
E.M.Shvidler, President, NK Sibneft
R.K.Vardanyan, President, ZAO Troika-dialog
V.Y.Alekperov, President, OAO NK LUKoil
R.I.Vyakhirev, Chairman of the board, RAO Gazprom


June 14, 2000
Missing Points From Strategic Development Plan
Olga Proskurnina 

According to Gazeta.Ru’s sources in the Russian government, the designers
of the new economic concept and the experts who worked on the program have
resolved to refrain from the previously projected, wishful prediction of
10% growth rate per annum and substitute it with the more realistic 4-5%
per annum. And there were some more changes. 
The 10-year program for the development of the Russian economy is expected
to be finalized in the next two days. The document will then be forwarded
to all ministries for familiarization. 

However, sources in the White House (seat of the Russian government) have
informed Gazeta.Ru that this is not the most striking achievement of the
government experts who elaborated and edited the document. According to our
source, during the final proof reading of the document the experts
jettisoned the “absolutely crazy ideas” of some lobbyists. 

The Tax Ministry, for example, was very eager to implement a scheme to
monitor all prices and provide fixed quotes to determine tax rates in order
to prevent entrepreneurs and enterprises from under declaring profits. But
Ministry officials suggested that it should be the sole organ responsible
for determining the real market value. This last suggestion was rejected. 

However, the program will contain a clause stipulating for the compulsory
publishing of real market prices in a special state reference book, but the
Tax Ministry will have nothing to do with keeping the reference book. 

Proposals submitted by the ‘power’ ministries and supported by tax
officials, were also rejected. The law enforcers insisted on introducing a
clause that would allow instigation of criminal proceedings against
businessmen for any kind of infringements in the economic sphere. The
governmental experts reviewed these proposals and decided against them,
realizing that in practice the introduction of such a novelty would permit
the authorities to detain those who break some administrative regulations,
and instead of paying a fine for some kind of infringement, for instance,
for failing to meet the Federal Securities Commission requirements, one
could have been imprisoned. The authors were reminded of the fact that the
prisons in Russia are overfilled with detainees. 

The White House experts also rejected the proposal from the regional
governors for the introduction of tax exemptions for so-called
‘medium-size’ investors. The proposal was dropped for the regional leaders
were humbly silent when asked about the criteria for estimating whether an
investor is ‘medium-sized’ or not. 

Another initiative brought forward by the governors of some regions,
especially those bordering Moscow, allegiant regions to Moscow, was to
divide Russia in seven economic districts that would coincide with the
newly formed federal districts. Thee economic districts they suggested
should be run by special people appointed by the federal center. This
provision has also been left out of the finalized version of the
governmental program. 

And rightly so it seems. The task of the general-governors (as the
presidential envoys to the federal districts are usually referred to as in
the Russian press) is to supervise provincial governors and make them take
the responsibility for the situation in their regions instead of being
responsible themselves. 

But the government officials’ most significant achievement was to prevent
the 2001-2010 economic program from being weighed down with needless
details. The government experts assert that the program is still a huge
document of over 500 pages, i.e. 50 pages of concrete economic measures per

It is now considered too late and useless to eliminate any other
shortcomings, and on June 22 the program will be presented at a
governmental meeting in its current hard to read form. However, the experts
seem satisfied that they will not have to read or proof read anything


Moscow Times 
June 15, 2000 
Scandal Comes at Bad Time for Putin 
By Simon Saradzhyan
Staff Writer

It is possible that President Vladimir Putin personally approved the arrest 
of NTV boss Vladimir Gusinsky so as to mute a critical media empire. It is 
also possible that forces hostile toward Putin arranged the arrest's timing 
so as to embarrass him on his high-profile trip abroad. 

Kremlin watchers could not settle Wednesday on a single theory as to who 
initiated the arrest of Gusinsky and why, but all those interviewed agreed it 
was a badly timed move that has created a public uproar both here and abroad. 

"This arrest came at the wrong time for Putin no matter who made the 
decision," said Yevgeny Volk of the Heritage Foundation. 

At the very least, Putin was almost certainly informed of Gusinsky's arrest 
in advance, said both Volk and Sergei Markov of the Center for Political 

It is also not unlikely that Putin personally approved the arrest, or even 
initiated it, but then left the timing to more clumsy subordinates, said 
Volk, Markov and Politika Fund chief Vyacheslav Nikonov. 

"Someone at a lower level could have chosen the day without thinking" that it 
coincided with the first day of Putin's weeklong trip abroad, Nikonov said. 

In the arrest's timing, Nikonov said, "I see more stupidity than any 
conspiracy against Putin." 

Markov echoed Nikonov, saying probably some official at the Prosecutor 
General's Office did not consider that by detaining Gusinsky at a time when 
Putin was meeting hordes of journalists several times a day abroad, he was 
putting the president in an uncomfortable position. 

Other politics watchers offered their own interpretations. 

Former Soviet President Mikhail Gorbachev sees "old forces" and "clans" 
ordering the arrest of Gusinsky behind Putin's back. 

Leading liberal Boris Nemtsov and Moscow Mayor Yury Luzhkov were in public 
agreement that the culprit behind the arrest is Kremlin Chief of Staff 
Alexander Voloshin f a bitter, longtime NTV enemy. Luzhkov and Nemtsov were 
among those calling for Voloshin's sacking. 

Voloshin is a leading member of the so-called "family," a political label 
used for a group of Yeltsin-era power brokers that includes 
tycoons-turned-legislators Boris Berezovsky and Roman Abramovich, as well as 
Boris Yeltsin's ambitious daughter Tatyana Dyachenko. 

Many politics watchers argue it was "the family" that plucked Putin from 
obscurity to become Yeltsin's successor. 

The Heritage Foundation's Volk speculated that "the family" may be trying to 
show that it, and not Putin, is the force running Russia today, and so may 
have set out to embarrass him with Gusinsky's arrest. 

Still another theory came Wednesday courtesy of, a web site run by 
Chechen separatists., quoting unidentified sources in Moscow, reported that Putin, 
Voloshin, Prosecutor General Vladimir Ustinov and Security Council Secretary 
Sergei Ivanov decided to arrest Gusinsky at a closed-door meeting June 2. 

And then there is the argument that Gusinsky did it to himself. 

Gusinsky's media, including the Segodnya newspaper and NTV television, 
recently picked up and reported allegations in the magazine Newsweek that 
Swiss prosecutors may soon charge Yeltsin's daughters with taking bribes. 

Markov argued that this might have been deliberately confrontational on 
Gusinsky's part f as a way of forcing them to arrest him now while Putin is 
vulnerable to foreign media. 

"Gusinsky realizes that he cannot prevent one from applying rigid measures 
against him, but he can influence their timing þ to be become a national 
hero," Markov said. 


Los Angeles Times
June 14, 2000
[for personal use only]
A Campaign of Terror in the Name of Fighting It 
Uzbekistan says brutality is necessary to quash Islamic extremism, but 
critics say the repression is backfiring. 
By RICHARD C. PADDOCK, Times Staff Writer

TASHKENT, Uzbekistan--Bahodyr Abdullayev, a devout Muslim, was arrested 
here in February after police found six bullets stuffed in a hole in the wall 
of his home. Relatives say the police had no problem finding the bullets 
because the officers themselves put them there--borrowing a screwdriver from 
Abdullayev's son to make the hole. 
Abdullayev was tortured in jail until he falsely confessed to belonging 
to a banned Islamic party, family members say. In May, after a brief trial, 
he and 13 other defendants were found guilty of anti-government crimes. 
Abdullayev, a 40-year-old engineer, was sentenced on the spot to 19 years in 
"They told us it was going to be an open and fair trial, but nothing 
like that happened," said his wife, Mamura, weeping outside the courtroom. 
In the name of fighting Islamic terrorism, this former Soviet republic 
carved out of the plains and deserts of Central Asia has imprisoned at least 
5,000 people, Uzbek human rights advocates say. Dozens of prisoners arrested 
for their political or religious beliefs have been executed, and more than a 
dozen more have been tortured to death, activists say. 
Uzbekistan--a landlocked nation roughly the size of California--has 
emerged as one of the most authoritarian and brutal of the 15 countries that 
gained independence with the collapse of the Soviet Union in 1991. 
President Islam Karimov has rolled back even the modest democratic gains 
achieved in the late 1980s under Soviet President Mikhail S. Gorbachev. Few 
dare to criticize Karimov, who was also Uzbekistan's top official during 
Soviet times. Indeed, "offending the honor and dignity of the president" is a 
criminal offense. 
Human rights activists liken the current wave of repression to the 
Stalinist purges. All opposition parties have been banned. The government 
controls the country's television, radio and press and can monitor all 
Internet traffic. The secret police tap telephones, trail suspected 
dissidents, falsify evidence and conduct searches with impunity, critics say. 
Judges, who are appointed directly by the president, rubber-stamp the 
findings of prosecutors and hand out long prison sentences. 
In keeping with the tradition of the Soviet gulag, a harsh new prison 
has been built in the remote desert of northwestern Uzbekistan to house the 
flood of political prisoners. The high-security penitentiary, located on a 
military base in the closed city of Zhaslyk, has become known as "the place 
from which no one returns." 
"You can be arrested for being in the wrong place at the wrong time or 
for being related to the wrong person," said Acacia Shields, a representative 
in Tashkent of New York-based Human Rights Watch. "If you display suspicious 
signs of piety, that is enough to get you arrested. Wearing a beard is 
During an April visit to Central Asia, Secretary of State Madeleine 
Albright personally appealed to Karimov to release leading human rights 
activists and allow representatives of the International Committee of the Red 
Cross to visit prisons. So far, he has not acted on her requests. 
Karimov, Uzbekistan's first and only president, contends that tough 
action is needed to combat Islamic extremists who threaten the stability of 
the region. 
"Such people must be shot in the head," he told parliament in 1998. "If 
necessary, I'll shoot them myself." 
According to critics at home and officials in Washington, such 
ruthlessness is only fueling religious zealotry and opposition to Karimov's 
Certainly, Uzbekistan sits at the center of a volatile region. On its 
southern border, the extremist Islamic Taliban has seized power in much of 
Afghanistan. In neighboring Tajikistan, Muslim rebels waged a costly civil 
war with the government during much of the 1990s. In Kyrgyzstan, another 
neighboring country, Muslim fundamentalists seized civilian hostages and 
fought government troops near the Uzbek border last year. 
Both Russia and the United States fear that the extremists' goal is to 
form an Islamic state extending from the Caucasus to China and encompassing 
much of what was once the southern territory of the Soviet Union. 
"It is common knowledge that attempts are underway to carve up 
post-Soviet lands along criminal lines with the aid of religious extremism 
and international terrorism," Russian President Vladimir V. Putin said during 
a visit to Tashkent, the Uzbek capital, in May. "An arc of instability has 
emerged in the republics on Russia's doorstep. Speaking bluntly and 
practically, if we do not stop international terrorism here, we will face it 
at home." 
It is a rare area of foreign policy where Moscow and Washington have 
found common ground. 

U.S. Sees Country as Potential Foothold 
U.S. officials claim that Afghanistan provides alleged terrorism 
mastermind Osama bin Laden with a haven for camps where zealots are trained 
to carry out violence against the United States, such as the deadly bombing 
of two U.S. embassies in East Africa in 1998. Russian officials contend that 
the same bases are used to train militants to fight alongside separatist 
Islamic rebels battling Russian troops in the republic of Chechnya. The U.S. 
and Russia both worry that if Islamic extremism gains a foothold in 
Uzbekistan, terrorism could spread more easily to other parts of the world. 
In Tashkent, Putin pledged support for Uzbekistan's efforts to fight 
extremism and promised that Russia will take "preventive steps" if necessary. 
Subsequently, top Kremlin aides have talked openly about the possibility of 
launching airstrikes against terrorist bases in Afghanistan. 
In April, Albright pledged nearly $10 million in new military assistance 
to Uzbekistan and other Central Asian governments to fight international 
terrorism and the narcotics trafficking that often accompanies it. 
At the same time, Albright made the case that the best way to defeat 
terrorism is to combine police action with greater respect for human rights 
and political opposition. 
"We believe, with the government of Uzbekistan and the other 
governments, that there are genuine terrorist threats in this region," she 
told reporters here. "But they can best be dealt with by the rule of law, by 
some very specific actions to fight terrorists, but mostly, I think, by 
allowing there to be a greater expression of freedom." 
Totalitarianism is nothing new in this part of the world. People in what 
is now Uzbekistan have lived in fear of their rulers for centuries. The emirs 
who governed ancient city-states such as Samarkand and Bukhara were often 
capricious and brutal, lopping off the heads or gouging out the eyes of those 
who gave offense or committed crimes. The Communists who came after the emirs 
continued that tradition, executing opponents and sending suspected enemies 
to the gulag. 
Karimov, 62, a mechanical engineer by training, began his career as a 
shop foreman at the Tashkent Farm Machinery Plant before becoming a designer 
of cargo planes. 
As a Communist apparatchik, he steadily rose to become a top official of 
the state planning committee and Uzbek finance minister. In 1989, he was 
named first secretary of the Uzbekistan Communist Party--an achievement made 
easier by an embezzlement scandal that had eliminated much of the republic's 
party leadership. 
After winning election as president in 1991--a victory he aided by 
barring his strongest opponent from running--Karimov quickly put a stop to 
the flowering of democracy, banning opposition parties and locking up his 
To build a national identity for the fledgling country, Karimov also 
created his own personality cult. Today, images of a smiling Karimov 
surrounded by adoring supporters beam out at the public from billboards 
across the country. State-controlled television and newspapers unashamedly 
promote him. Signs posted in prominent places bear the sayings of Karimov, 
such as "Uzbekistan is a state with a great future." 
Karimov--who had already extended his initial five-year term by three 
years--was reelected in January, winning more than 91% of the vote in 
balloting condemned by international observers as undemocratic. 
With the demise of communism, it had become legal to practice religion 
in Uzbekistan for the first time in 70 years, and Islam rapidly regained 
popularity in this traditionally Muslim region. Officials say more than 85% 
of the population adheres to one form of Islam or another. 
The result was that, with democratic parties and free speech banned, 
Islam became the only outlet for opposition to the government. Islamic 
fundamentalists found growing support for their dream of a Muslim state. 
In 1998, the government, alarmed by the trend, adopted a measure 
restricting religion. Among other things, the law requires religious groups 
to register with authorities. 

Crackdown Launched After Car Bombings 
In February 1999, six car bombs rocked Tashkent, killing 16 people and 
damaging the main federal building. Karimov denounced the blasts as an 
attempt to assassinate him and pledged to stamp out the "dark forces" behind 
the explosions. 
The president initiated a crackdown that continues today. Some human 
rights activists estimate that tens of thousands of Uzbeks have been 
imprisoned, although that figure is impossible to document because the names 
of arrestees are rarely made public. 
Many of those arrested have reportedly been tortured to get them to 
confess or implicate others. The State Department's most recent report on 
human rights called Uzbekistan "an authoritarian state" and said methods used 
by the police to torture prisoners include electric shocks, near-suffocation 
and beatings with rubber sticks and plastic bottles filled with water. 
Relatives of arrested men say one common form of torture is burning the 
The nation's top police official warned last year that fathers would be 
held accountable for the crimes of their sons. When unable to find suspects 
they are seeking, police have arrested family members and locked them up 
One notable case is that of Imam Obidhon Nazarov. A revered Muslim 
cleric, he refused government demands that he praise the president during 
religious services. Fearing his arrest was imminent, he fled the country in 
1998. The government imprisoned two of his brothers, his uncle and his 
"The state must have thought that since my son was so popular, he posed 
a threat to the authorities," said the imam's mother, Muhoromhon, 62. "This 
was a big mistake on their part, because my son has never wanted anything but 
to pray and be a true Muslim." 
Prosecutors have great leverage in the Uzbek legal system. If a judge 
does not follow the prosecutor's recommendation, the prosecutor can appeal to 
a higher court. A judge who has decisions overturned twice can be removed 
from office. Consequently, judges rarely look closely at falsified evidence 
or defendants' arguments, critics say. Trials are usually brief and sometimes 
held behind closed doors. 
Family members and activists say many prisoners have been told by 
prosecutors that they will be set free if they ask for forgiveness. When they 
do, their pleas are considered admissions of guilt, and they are given 
sentences of as much as 20 years in prison. 
The worst reports of treatment come from the prison in Zhaslyk. 
According to Vasilia Inoyatova, a human rights activist who gained access to 
the facility last year in the guise of visiting a relative, prisoners suffer 
a wide range of abuses. 
Inmates have been forced to remain squatting with their hands behind 
their heads for much of the day, Inoyatova said. To stretch their arms or 
legs, they were compelled to get permission from a guard and then thank 
President Karimov for allowing them to move, she said. The prisoners were 
also required to sing the Uzbek national anthem 50 times a day, she said. 
Rights activists and U.S. officials say the evidence is clear that the 
repression in Uzbekistan is backfiring, creating a stronger and more extreme 
Islamic resistance. 
"Indiscriminate government censorship and repression can cause moderate 
and peaceful opponents of a regime to resort to violence," Albright said in 
Tashkent. "It can turn civilians who have never been interested in politics 
into extremists." 

Albright Appeals for Release of Activist 
In particular, Albright appealed to Karimov to release Mahbuba Kasymova, 
a leading human rights activist who was accused of "harboring a criminal"--a 
fellow activist who was arrested while visiting her home. Last year, Kasymova 
met with the judge in her case only to discover that she was to be tried 
immediately. She was denied permission to present witnesses or have her own 
attorney in the courtroom. After a three-hour trial, she was convicted and 
sentenced to five years in prison. 
"The ability of Uzbekistan to jail human rights activists with impunity 
is a shocking reminder of how little U.S. agencies are using their influence 
here," said Shields, the Human Rights Watch representative. 
Outside the courthouse in Tashkent, Mamura Abdullayev held her 
2-year-old daughter in her arms and contemplated the bleak future she faces 
without her husband for the next 19 years. 
Her clothing--a tightly wrapped head scarf that left only her face 
exposed and a loose-fitting dress that covered her wrists and ankles--denoted 
a devotion to Allah that the government associates with dangerous 
Her husband, she said, turned to Islam 12 years ago and found that 
reading the Koran aloud helped cure him of a longtime stutter. 
"He's never been involved in a terrorist group," she said. "He's a good 
man. We can't even say anything. If you open your mouth, you get yourself in 


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