November 15, 2000    

This Date's Issues:  4636  4637

Johnson's Russia List
#4637
15 November 2000
davidjohnson@erols.com

[Note from David Johnson:
1. Reuters: Putin pledges more reforms at APEC meeting.
2. Reuters: Russia says planes got sneak views of U.S. carrier.
3. Moscow Times: Yevgenia Borisova, Agriculture Reforms Slow to Take Root.
4. New York Times: Elizabeth Olson, Swiss Raise Sum in Bank Case, to $500 Million.
5. New York Times editorial: The Leaner Russian Military.
6. BBC Monitoring: Russian paper sees missile chief at odds with Putin over nuclear initiative.
7. Wall Street Journal: Roy Hofheinz, Economists Call for More Reforms To Ensure Ex-Communists Thrive.
8. Stanislav Menshikov: NEW PAPERS ON RUSSIAN DEFENCE INDUSTRY.
9. Transitions Online: Russell Working and Nonna Chernyakova, More Charity, Less Ideology. A new attempt to revive the Soviet-era Komsomol in Russia sparks a debate over whether the youth organization can shed its communist past for a charitable future.
10. The Independent (UK): DJ Taylor, Dark fable of an imprisoned soul in Teletubby land.
11. Newsweek-Itogi: Irina Rozenberg, IKEA enjoys Russian success.  Despite low salaries, Russians flock to Swedish superstore.    
12. RIA: Duma is not going to send deputies as observers to US presidential elections.
13. Interfax: Leading Russian clergy call on authorities to counter blasphemy.
14. Reuters: Clinton, Putin discuss arms control, alleged spy.
15. Reuters: Russia to draft corporate governance code in 2001.]
 
******

#1
Putin pledges more reforms at APEC meeting
By Patrick Lannin
 
BANDAR SERI BEGAWAN, Nov 15 (Reuters) - Russian President Vladimir Putin
promised to keep his country on the path of economic reforms and
liberalisation on Wednesday as he attended a meeting of other nations on the
Asian-Pacific rim.

Putin, attending the Asia-Pacific Economic Cooperation (APEC) forum, told an
audience of businessmen and government officials  Russia was a fit partner
for them as it had achieved stability after years of hectic post-Soviet
change.

"The main direction of our activity will be liberalisation in all areas," he
said, adding that Russia intended to cut import tariffs sharply, lessen
restrictions from non-tariff barriers and carry out further structural
reforms.

He stressed that Russia, as a "Euro-Asiatic nation" was intent on furthering
its economic links with Asia as a whole and urged businessmen to get involved
in the exploitation of the country's huge mineral wealth in the vast Siberian
expanse.

Putin, who won a March election after becoming acting Russian leader on New
Year's Eve following the shock resignation of Boris Yeltsin, said his
government's main success had been in ending political uncertainty.

"Our main achievements in the recent past have been stability, which was so
lacking in Russia," he said.

Reiterating one of his key themes of boosting the effectiveness of
government, he said the state's main job in Russia now was to make sure the
country's legal system worked and end state interference in areas where it
was not needed.

Putin noted his country was heading for strong growth this year, predicting a
rise in gross domestic product (GDP) of seven percent, which would be the
highest in Russia's post-Soviet history after a 3.2 percent gain in 1999.

Putin also addressed the issue of globalisation, one of the key matters being
discussed at the APEC gathering, and said it had downsides and upsides.

Among the upsides he cited the speeding up of communications and financial
transfers although the downside was the potential for the spread of crime.

"The illegal transfer of money...money laundering, narcotics...and as a
consequence, terrorism," he said.

The Kremlin leader also said entry into the global trade body the World Trade
Organisation was a priority for Russia.

"We are actively holding bilateral talks with WTO countries," Putin said.

Russian Economy Minister German Gref told reporters his country expected to
complete WTO talks next year in order to gain entry to the body in 2002 or
2003.

Putin is to hold a series of meetings on the sidelines of the summit. He
earlier met U.S. President Bill Clinton and was due to hold talks with
Chinese leader Jiang Zemin.

APEC groups Australia, Brunei, Canada, Chile, China, Hong Kong, Indonesia,
Japan, South Korea, Malaysia, Mexico, New Zealand, Papua New Guinea, Peru,
the Philippines, Russia, Singapore, Taiwan, Thailand, the United States and
Vietnam.

******

#2
Russia says planes got sneak views of U.S. carrier
 
MOSCOW, Nov 15 (Reuters) - Russian reconnaissance planes managed to sneak
past air defences of the U.S. aircraft carrier Kitty Hawk, triggering panic
on board, Russian commanders were quoted as saying on Wednesday.

RIA news agency quoted General Anatoly Kornukov, the Air Force chief, as
saying Russian Sukhoi-24MR reconnaissance planes had flown undetected by the
Kitty Hawk in the Sea of Japan on October 17 and November 7, making several
passes overhead.

"For the Americans, our planes were a complete surprise," Kornukov said.
"Pictures clearly show panic on board the ship."

He described the results of the reconnaisance flights as impressive and made
clear such missions were not unique. He said the Russian pilots would be
decorated.

"First of all this is a good training for crews," he said. "Secondly we
contribute solid information to interested Russian (intelligence) agencies."

There was no immediate comment from the United States.

Interfax news agency quoted the commander of the 11th anti-aircraft army,
Lieutenant-General Anatoly Nagovitsyn, as saying the Kitty Hawk was
refuelling when Russian planes approached it.

"Americans started hastily cutting off fuel pipes," he said. "U.S. planes
were not immediately ready to act."

Kornukov said the U.S. military noticed the Sukhois only when they were
making their second round over the Kitty Hawk, and only then sent their
planes to deal with the intruders. He did not say which of the two occasions
he was describing.

"There were no incidents in the air. The U.S. side did not undertake any
provocative actions," Kornukov said.

Russian and Soviet forces based in the Atlantic, Pacific and Indian oceans
and the Mediterranean Sea closely monitored each other throughout the Cold
War.

But after the collapse of the Soviet Union in late 1991 cash-strapped Russia
dramatically reduced its off-shore presence.

******

#3
Moscow Times
November 15, 2000
Agriculture Reforms Slow to Take Root
By Yevgenia Borisova
Staff Writer

Even some of the poorest former Soviet republics are ahead of Russia when it
comes to the transformation of their agricultural sector, an international
conference on agriculture in the Commonwealth of Independent States heard
this week.

"In some respects Moldova and the Ukraine þ are considerably ahead of
Russia," said John Costello, president of Citizens Network for Foreign
Affairs.

The Washington-based network organized the two-day Moscow conference, which
was sponsored by agriculture machinery makers Caterpillar Inc. and Claas Co.

Costello said Ukraine and Moldova had made more progress than Russia on the
restructuring of former state farms and the privatization of land, the
process of redistribution of land and property rights.

Robert Mitchell, the head of a delegation from management consultants
Booz-Allen & Hamilton, which is implementing a U.S. Agency for International
Development project to develop land and real estate markets in Moldova, said
that the core of the land reform in Moldova was the creation of small plots
that could be bought and sold.

He said 790,000 Moldovans have received ownership certificates for 2.2
million plots, with the average plot covering 1.5 hectares.

In recent years, laws allowing land sales have been passed in Moldova and now
two banks and six rural savings and credit associations are providing loans
for agriculture producers.

Mitchell said that when the Moldovans received certificates on their land,
they did not rush to sell it. Most of the land f 80 percent f has been leased
to farms, while only 1,300 land parcels have been sold.

Ukraine has also taken several crucial steps that enabled it to make visible
progress this year.

Ukrainian Deputy Agriculture Minister Roman Schmidt said that a flat land tax
that is not affected by inflation was introduced f as low as $4 per hectare.

In 1999 all of Ukraine's collective and state farms were privatized and f as
in Moldova f people started to officially lease their land.

Last summer, Ukraine ended state control of agriculture prices.

Schmidt said privatization of the farms, creation of individually owned plots
and liberalization of prices caused agriculture production to increase
immediately.

He said growth in the sector had been a mere 0.2 percent for the first eight
months of this year compared with 1999. After nine months it was already 1.3
percent and after 10 months f 2.1 percent, Schmidt said.

Sales of local agricultural products increased by 25 percent in 10 months, he
added.

In Russia, the Land Code is firmly stuck in the State Duma where the
Communist faction believes that sales of farmland is equivalent to selling
the fatherland.

Some 117 million hectares, which belong to about 12 million peasants, are
held in common in collective farms, which on paper are called privatized
agriculture enterprises.

The sector lacks a sound legal infrastructure to protect investments.

Peter Sochan, senior policy coordinator with CNFA, said in an interview that
when consultants from the United States started to assist CIS countries on
agriculture reforms 10 years ago, there was no clear understanding of which
direction to take.

"None of us really knew then how to make such big dramatic changes all at
once," he said. "We had a number of ideas and sometimes they were very
different. We had an opportunity to experiment."

Commenting on why agriculture reforms in CIS countries f he named Moldova,
Georgia, Kyrgyzstan and Ukraine f are ahead of the ones in Russia, Sochan
said that conducting experiments is much easier in smaller countries because
the establishment to change there is not as big as it is in Russia.

Vladimir Bashmachnikov, president of the Russian Farmers Association, said
that only activation of the land market could enable the mixture of different
needed reforms in agriculture to take place.

"If we don't have land reform, our agriculture will rot," he said.

******

#4
New York Times
November 15, 2000
[for personal use only]
Swiss Raise Sum in Bank Case, to $500 Million
By ELIZABETH OLSON

GENEVA, Nov. 14 - An investigation has turned up evidence that $500
million, far more than previously believed, was transferred to Swiss banks
from accounts at the Bank of New York as part of a Russian plot to avoid
taxes and launder money.

An investigating magistrate here, Laurent Kasper-Ansermet, announced the
sum last week at a legal seminar on corruption. He said the money was from
Bank of New York accounts held by Becs, Benex International, and Lowland,
all opened by Peter Berlin, a Russian émigré in the United States who,
together with his wife, Lucy, a former vice president at the bank, pleaded
guilty in February to a charge of conspiracy to launder money in Federal
District Court in Manhattan. The two have not been sentenced.

The sum here is many times larger than the $16.8 million that was frozen
last year in Swiss banks, and it opens the possibility that authorities
here will require Swiss banks to conduct a new search of transactions with
the Bank of New York.

Mr. Kasper-Ansermet was not in his office today, but an aide confirmed
reports of his statements.

The $500 million is on a par with the amounts deposited by a former
Nigerian dictator, Sani Abacha, and former President Ferdinand E. Marcos of
the Philippines.

Benex accounts at the Bank of New York have been at the center of a federal
investigation into laundering that began in 1998. The company, along with
related accounts at the Bank of New York, was the principal pipeline
through which at least $7 billion moved from Russia to the Bank of New York
and back to foreign bank accounts from February 1996 to August 1999.

Much of the money is widely thought to have come from Russian trading
companies that were trying to avoid duties and taxes or from rich Russians,
many of whom have fled to Switzerland after the Soviet Union collapsed, to
avoid taxation. A small part of the money was involved in criminal
activity, United States prosecutors have said.

Geneva authorities began an inquiry into suspect Russian money in Swiss
accounts last year, and some banks reported suspicious transfers from the
Bank of New York. At that time, a spokesman for the Federal Justice
ministry, Folco Galli, said the transfers totaled $16.8 million and that 12
instances had been referred to Geneva authorities for investigation. Today,
Mr. Galli said he had no information on new transfers.

At the seminar on corruption, Mr. Kasper-Ansermet said he intended to ask
the United States again for legal help to try to track the origins of the
$500 million. He has previously complained publicly about a lack of
cooperation by Russian and American authorities in tracing the funds.

A crucial element of his investigation is to try to determine whether the
funds stemmed from criminal activities or from tax evasion, which is not a
crime here.

******

#5
New York Times
November 15, 2000
Editorial
The Leaner Russian Military
 
Russia's decision to shrink its military forces by 600,000 people over the
next five years is encouragingly realistic. So is President Vladimir Putin's
renewed call for drastic cuts in the number of Russian and American nuclear
warheads. Russia can no longer afford to sustain the imperial-size forces it
inherited from the Soviet Union. Conversion to a smaller, better-equipped
force will allow more effective defense against any foreign threats and would
decrease the risk to democracy from restive, underpaid military officers.

Russia has between four ion and five million men and women in its military
forces, including regular defense forces and Interior Ministry troops. Almost
one-fourth of the national budget goes to defense. Yet most soldiers are not
paid enough to live on, some are not paid at all, housing and food are
inadequate, training has been drastically cut back and equipment is obsolete.

Russia has moved slowly to shrink its armies and nuclear arsenal to more
realistic levels. Influential generals have resisted the cuts and civilian
leaders hoped that maintaining the military trappings of a superpower might
preserve Moscow's diplomatic clout. But the strain of keeping up these troop
levels merely advertised weakness. Ill- equipped and poorly trained units
lost Russia's first war in Chechnya, and in the current conflict Russian
forces have prevailed through the indiscriminate use of firepower against
Chechen fighters and civilians.

The personnel cuts, announced by Mr. Putin this week, come partly in response
to these developments. The money saved, together with planned budget
increases, will let Moscow triple its spending per soldier over the next
decade. That should produce a force strong enough to repel any external
threats that may develop along Russia's frontiers in the Caucasus, Central
Asia or Siberia.

Mr. Putin has also appealed to the next American president to reduce both
sides' nuclear warheads to somewhere between 1,000 and 1,500 each. Currently
each has more than 5,000 warheads available for use on intercontinental
missiles or bombers. Further reductions have been held up by arguments over
American missile defense plans. Even if that issue were resolved, the
Pentagon has opposed cutting American warheads below 2,000 to 2,500. Russia
cannot afford to maintain strategic nuclear forces that large. If Moscow
proceeds with deep cuts, the Pentagon should reassess how many warheads
America really needs.

The era in which Moscow and Washington spent trillions of dollars vying for
conventional and nuclear supremacy is mercifully over. Russia's move toward a
smaller, more modern military is healthy, and its eagerness to further reduce
nuclear weapons levels deserves American encouragement.

******

#6
BBC Monitoring
Russian paper sees missile chief at odds with Putin over nuclear initiative
Text of report by Russian newspaper 'Segodnya' on 14th November

Taking advantage of some confusion in the United States linked with the
presidential election, the Kremlin has submitted a pre-emptive peace
initiative. Vladimir Putin is suggesting to the United States that the level
of nuclear munitions in our countries be reduced to 1,500 units by 2008 and
then go even further, using the mechanisms of the START-2 and START-3
treaties. At the same time the Russian president has voiced the hope that the
US Senate "will follow the example" of the Russian Federation Federal
Assembly and complete ratification of the START-2 Treaty and accords in the
sphere of antimissile defence.

Clearly, Putin's statement is addressed to the new US Administration. But the
time has obviously been chosen poorly: the text will have to be repeated when
it finally becomes clear who the White House incumbent is. And if it is
George Bush Jr., who makes no secret of his intention to deploy the national
missile defence system regardless of Russia's opinion, it will be a
completely different ball game.

Strategic Missile Troops [SMT] Commander-in-Chief Vladimir Yakovlev so
obviously does not share his supreme commander-in-chief's optimism that he
deemed it necessary on the day that the president's statement appeared to
voice the view that the United States has already invested considerable
financial, scientific and technical and material resources in the antimissile
defence programme and hence "stopping the US military-industrial complex in
its tracks seems unlikely". To put it more simply, Yakovlev is proposing to
reconcile himself to the fact that modification of the 1972 ABM Treaty cannot
be avoided with the Republicans' arrival in the White House.

As a solution to the situation the SMT commander-in-chief is considering the
possibility of introducing a so-called constant composite indicator for
strategic arms, which could include defensive antimissile defence systems as
well as offensive nuclear weapons: "Then a country that wants to
quantitatively increase one of the components would also be compelled to
quantitatively downsize the other."

'Segodnya' has learnt that in the course of the consultations on strategic
offensive arms and antimissile defence problems the US side has already
hinted that it has no intention of lowering its "nuclear ceiling" to 1,500
warheads but it may at least agree to 2,200 warheads, and not a warhead less.
The Republicans' stance on the problem of national missile defence, which
Bill Clinton has "put on ice", will hardly be less tough. Commander-in-Chief
Yakovlev has another possible response for that eventuality, namely, to make
our ground-launched ICBM's equivalent to the United States' sea-launched
ICBM's, which would make it possible to rectify the Foreign Ministry's old
mistake of taking our ICBM's out of the START-2 framework and fitting them
with MIRVed warheads. But this will mean the complete abandonment of all
strategic accords.

In all probability, this is what will happen. Even if the Democrats remain in
the White House, this will not impede the pro-Republican Congress from
earmarking funds for the modernization of national missile defence.

******

#7
Wall Street Journal
November 15, 2000 
[for personal use only] 
Economists Call for More Reforms To Ensure Ex-Communists Thrive
By PAUL HOFHEINZ
Staff Reporter of THE WALL STREET JOURNAL

LONDON -- Top economists say the former communist bloc is enjoying
unprecedented economic prosperity, but warn that reforms will have to go
deeper, in many places, for the improvements to become a permanent part of
life.

"The general economic news [in Central and Eastern Europe] is the best since
1997," says Willem Buiter, chief economist at the European Bank for
Reconstruction and Development and the principal author of the bank's annual
economic ranking, the Transition Report 2000, released Tuesday. "It is clear
that deeper restructuring is a prerequisite for turning this one-off event
into a sustainable thing."

The EBRD report says that the 26 economies of Central and Eastern Europe will
grow 4.8% on average this year -- the best result since 1997, the year before
Russia's financial collapse wreaked havoc on its neighbors' economies. The
report says the trend should continue next year, with roughly 4.1% growth
across the region.

Export Growth

The reasons for the improvement are many, the report says. First and
foremost, a buoyant global economy has helped raise exports. But high oil
prices have also given a boost to the area's oil-exporting economies. Many
exporting countries, the report says, have also benefited from the roughly
60% devaluation that some currencies underwent in the aftermath of the
Russian financial crisis.

And yet, the report warns that more must be done to take advantage of these
temporary improvements. It singles out Russia, and other Commonwealth of
Independent States countries in particular, for avoiding painful reforms,
noting that this hesitation is one reason why poverty in the region has
become so widespread. An effort to maintain full employment through hidden
subsidies has caused living standards to fall dramatically in these
countries, the report says.
 
"The economic consequences [of a full-employment policy] are that it doesn't
release labor to go into more productive employment," says Simon Commander,
an EBRD economist who helped write the report.

"The costs [of this policy] have been monumental," he adds, noting that the
hidden subsidies used to sustain full employment include below-market energy
costs, barter and poor tax collection.

Social Safety Nets

Mr. Commander says that countries that have aggressively liberalized their
economies -- like Poland and Hungary -- are creating jobs more quickly in
viable sectors of their economies. One reason, he says, is that these
countries have built up strong social programs that encourage innovation and
entrepreneurship. "A social safety net encourages people to take risks," he
says, pointing out that people are more likely to go into business for
themselves if they don't fear leaving their old job behind. "The failure to
create an adequate social safety net [in C.I.S. countries] means that people
in those countries fight like hell to keep what they've got," he adds.

Mr. Commander also says that the region's highly educated work force has
turned out to be a less valuable asset than many had hoped. When communism
collapsed, it left behind many highly skilled laborers, but their skills are
becoming less relevant to modern economic tasks, especially in countries
where economic activity has been mostly stagnant.

"People get most of their skills on the job" he adds, noting that as a
result, the skill base is deteriorating with alarming speed in countries with
slow-moving economies.

Regional Differences

The report divides the region's 26 countries into three geographic areas: the
former Warsaw Pact countries of Eastern Europe, which have embraced reform
the most aggressively; the war-torn Balkan states, where reforms have stalled
amid political turmoil; and the C.I.S., where reforms have been pursued
haphazardly.

In addition, the report's authors warn that the divisions among the regions
will only grow wider if governments in the C.I.S. and the Balkans don't
pursue reforms more aggressively.

The report says Russia in particular must do more to take advantage of recent
improvements. It says the Russian economy will grow at about 6.5% this year,
up from 3.2% last year, but it adds that Moscow needs to do more to use this
prosperity to put in place policies that will encourage value-adding economic
activity.

Mr. Buiter says Russia's biggest challenge will be to overhaul its legal
infrastructure. One particularly large task, he says, will be finding a way
to allow a market economy to flourish without watching valuable state assets
disappear into the hands of well-connected businessmen. "The jury is still
out on [President Validmir] Putin in that regard," he says. "It remains to be
seen whether his policies will lead to more state capture or less."

******

#8
Date: Tue, 14 Nov 2000
From: "stanislav menshikov" <menschivok@globalxs.nl>
Subject: NEW PAPERS ON RUSSIAN DEFENCE INDUSTRY

Four new papers on the state and prospects of Russian military and related
industries have just appeared on the ECAAR-Russia Internet site at
http://www.ecaar-russia.org. They are:

Stanislav Menshikov - THE STATE OF THE DEFENCE COMPLEX IN RUSSIA
Paper presented at Joint Russian-Finnish Seminar on the Russian Economy
Helsinki, October 3, 2000
Leonid Kosals, Rozalina Ryvkina, and Michael Intriligator -  RUSSIA'S
DEFENCE
ENTERPRISES: BETWEEN THE STATE AND THE MARKET
Based on surveys of directors of defense enterprises.
Michael Intriligator, Serguey Braguinsky, and Vitaly Shvydko - DEVELOPING
THE HUMAN
CAPITAL INTENSIVE SECTOR IN RUSSIA: A CHANCE FOR ECONOMIC REVIVAL?
Published as a Milken Institute Policy Brief in 2000.
Àlexander Sokolov - RUSSIAN DEFENCE INDUSTRY AT THE TROUGH (in Russian)

All those interested are cordially ivited to visit the site. See "Papers"
and "Forum" on the main menu.

******

#9
Transitions Online
www.tol.cz
November 13, 200
More Charity, Less Ideology
A new attempt to revive the Soviet-era Komsomol in Russia sparks a debate
over whether the youth organization can shed its communist past for a
charitable future.
by Russell Working and Nonna Chernyakova
Russell Working and Nonna Chernyakova are freelance writers based in
Vladivostok, Russia.

VLADIVOSTOK--It might have been a scene out of the Russian Civil War. Clad
like a Communist Party commissar in a soldier's tunic, long leather coat, and
worker's cap, a young man sought to stir up a crowd of women in red
kerchiefs, men dressed as Bolshevik soldiers, and curious passersby.

He gestured and shook his fist, surrounded by banners and posters that read,
"Youth for democracy and social progress," "The Komsomol is always in the
advance guard," and "Vanquish illiteracy!"

"Long live Russian youth," he shouted. "Hurrah, comrades!"

"HURRAH!" cried the listeners.

But what perhaps resembled a historical street theater recalling a vanquished
communist philosophy had a more serious purpose in the minds of the
organizers. The rally aimed to recruit the young people of this Russian Far
Eastern port city of 700,000 to the Communist Party youth organization, the
Komsomol--a group that was disbanded in 1991.

With the 80th anniversary of the founding of the Komsomol in the Far Eastern
Primorye region during the first week of November, nostalgic former members
sought to re-establish the group that traditionally formed the penultimate
step toward membership in the Soviet Communist Party. With the help of a
$1,450 donation from the regional administration, the Union of Komsomol
Members of All Generations have lectured in schools, hung banners across
boulevards, and held rallies on behalf of the organization. The Komsomol,
after all, was once central to the life of youth in the Soviet Union--a
political obligation, source of camaraderie, and seemingly bottomless labor
pool for Communist Party leaders with grandiose visions to draw on.

While the revival has drawn the ire of former dissidents and victims of the
communist era, many people--communist or not--say there are much worse things
that could happen than a revival of the Komsomol. A lack of
organizations--especially those uniting an increasingly neglected youth--is a
major concern that some say could be alleviated with a group like the
Komsomol--minus the ideology.

Many recall their youth with nostalgia, without even thinking about the false
ideological basis for the [Komsomol], says Nadezhda Syroyed, a sociology and
psychology professor at Vladivostok's Far Eastern State University. Perhaps
with a changed face and a little less ideology, a new and improved Komsomol
could be just what Russia's youth need.

"There are no youth organizations left [in Russia], so it is natural for
young people to look for something that unites them," Syroyed says. "So the
Komsomol isn't the worst solution. Although the ideology was wrong, this
organization never caused harm to anyone, and its idea was positive. Now it
can transform into a charitable organization."

But there are probably just as many who would disagree that anything good
could come from the Komsomol--at least if history is anything to go by.
Nikolai Turkutyukov, a 73-year-old pensioner, spent five years as a slave
laborer in Stalin's work camps after he openly praised American movies and
industry following a World War II-era trip to Portland, Oregon. "I am
outraged. I am horrified," Turkutyukov said. "The people who are organizing
all of this are former party and Komsomol secretaries. They were always
sitting in warm places and making their careers."

"I feel only disgust seeing all these celebrations," said 64-year-old Natalya
Litvinenko, whose close relatives were arrested under Stalin. "I remember
people screaming slogans from a podium, but they were working for the
Communist Party and were just using us. I never believed them. These were
always the worst people ...

"Now many Komsomol leaders are rich people. ... The same people who were
trying to convince us that communism was the right thing now say that the
market economy is the right thing," she said.

Many former Komsomol members see it differently, recalling patriotic songs,
cruises at sea, and working together in the fields of the countryside. Oleg
Podatkov, a 30-year-old tax inspector in the former Soviet state of Ukraine,
heard from his brother in Vladivostok about the union's attempts to
re-establish the Komsomol. He wasted no time in flying to Vladivostok to help
out. Despite the predominance of old communist slogans at a 4 November
recruitment rally in front of a suburban movie theater, he says he isn't
interested in the organization's old politics.

"This was the call of my soul. We have nothing like this in my country. I was
always impressed by what the Komsomol accomplished in terms of developing
Russia. I came here to learn more about the movement. I hope, though, that
the modern Komsomol will be free from political issues," Podatkov said.

Former Komsomol members are not the only Russians who pine for the social
structures and personalities of the Soviet era. Throughout the nation,
thousands of mostly elderly communists met on 7 November to celebrate the
83rd anniversary of the 1917 Bolshevik Revolution. Around 2,000 people
gathered in Vladivostok's Central Square to wave red banners, recite
political poems, and listen to speakers unleash torrents of invective aimed
at former Soviet General Secretary Mikhail Gorbachev and former Russian
President Boris Yeltsin.

Tatyana Shishina, 50, waved a poster of Stalin as she listened to the
speakers denounce Russia's leadership for post-Soviet hardships. "I like the
life that we had in the past," Shishina said. "Now we have nothing. I wish
Stalin were alive. He would have put the country in order."

At least as far as the communists are concerned, the Komsomol revival
suggests their sacrifices on behalf of the revolution were not in vain.

FOR THE GOOD OF THE NATION

The Komsomol, an acronym for the All-Union Leninist Communist League of
Youth, was organized in 1918 in order to band together various youth
organizations that had previously been involved in the Revolution; many of
these groups subsequently fought in the Civil War. When the war ended in
1922, the group involved its members in health activities, sports, education,
publishing, and various industrial projects.

Membership reached its height in the 1970s and early 1980s, with 40 million
participants. In Soviet society, its members were frequently favored in
employment, scholarships, and other privileges. Active participation in the
Komsomol was a big boost in gaining membership into the ranks of the
communist elite.

In Vladivostok, where the pro-tsarist White Army held out against the
Bolsheviks until 1922, the local branch of the Komsomol was founded two years
after the national organization, in 1920. The organization was touted as
combining the esprit de corps of the Boy Scouts with the muscle of a student
labor brigade. Over the years, its volunteers harvested crops during worker
shortages, built rural housing, and laid tracks for the Baikal-Amur Railroad
through the swamps of the Russian Far East.

But others angrily recall the shortcomings. One of the greatest triumphs of
the Komsomol, the railroad, has deteriorated and sunk into the swamps and is
largely unusable today. And the group's leaders--many of whom are major
business and political figures in Russia today--were often notorious for
their greed, not to mention the lavish, drunken sauna parties.

"The Komsomol was all lies and hypocrisy," said Natalya, a 37-year-old
beautician and former member. "At the Komsomol meetings, all they did is
force us to collect fees regularly. We never discussed anything but this
money."

With the advent of Gorbachev's reforms, young Russians began turning away
from the party organizations of the past and toward the seductions of the
West. As a result, the Komsomol was disbanded in 1991 and faded into the
background.

This year--for the first time since its extinction--the Union of Komsomol
Members of All Generations was created in Vladivostok to honor the group's
80th anniversary. Though it has no registered members and doesn't collect
fees, it has sponsored rallies in major cities throughout the region. With
the backing of the union, schoolteachers taught and students scratched out
compositions about the heroic past of the Komsomol.

According to the union's leader, 46-year-old Valentin Labonin, there are
similar groups in Moscow and the Siberian city of Novosibirsk and that he
hopes "the movement will spread all over Russia."

But the Komsomol will have to market itself cleverly if it hopes to unite
masses of youth. Despite the recruitment drive, some young people targeted by
the 4 November rally were distinctly uninterested. Several teenage girls
hanging out nearby said they had no idea what the Komsomol was, let alone any
desire to join.

Natalya Shavlo, 12, however, said that she and her classmates had been
studying the Komsomol and found it to be an attractive way to ensure a future
for Russia's youth. "Last Friday we had a lesson at school dedicated to the
Komsomol, and people suggested that we join the new organization," she said.
"We even sang the old Komsomol songs. I think it would be nice if young
people got more united."

While some in a nation struggling toward a market economy might regard the
Komsomol as a dinosaur from an era of state control, Yevgenia Vodopianova,
33, an owner of a small business, said she continues to admire the
organization.

"I remember a lot of healthy things that were going on in the past," she
said. And I know people who implemented their ideals, and life proved their
wisdom. So we should learn from them. The human resources in the Komsomol
were enormous, and now as a manager, I am even researching why it was such a
success. Of course, there were funny and even ridiculous things, but we
shouldn't reject everything that happened," Vodopianova said.

For all its role in supporting a totalitarian system, the Komsomol always
proclaimed its goals in the language of international peace and brotherhood.
It is this that separates the Komsomol, despite its excesses and corruption,
from the more notorious Hitler Youth.

Still, tones of nationalism continue to be one of the organization's most
solid foundations. It's not all campfires and camaraderie, "It's love for the
motherland that unites people," said Sergei Mishchenko, a 19-year-old student
from the nearby town of Arseniev, who has started a Komsomol youth club that
offers educational programs and has recruited volunteer lawyers to help
pensioners resolve their legal problems.

Igor Skorik, a 62-year-old pensioner, grew reflective while singing old
Komsomol songs at a rally filled with red banners. "I entered the Komsomol in
1954, and in my soul I am still a Komsomol member," he said. "I worked in the
northern Kuril Islands, in Sakhalin, in Magadan, and all my life I felt this
Komsomol enthusiasm for improving my country."

******

#10
The Independent (UK)
15 November 2000
Dark fable of an imprisoned soul in Teletubby land
By DJ Taylor

At first sight, the news that Russian television has bought all the existing
episodes of Teletubbies from the BBC is faintly baffling. Granted, the
Russian TV moguls will be adapting the material to suit the sensibilities of
their own audience ("tubbytoast" is transmogrifying into puzi-blinchik, or
"tubbyblinis"). All the same, native fans of La La, Po and co will perhaps
find themselves wondering how this kind of thing is liable to go down in
Vladivostok.

In fact the relentless march of big hugs, tubby night-nights and all the rest
of it eastward across the Urals fits neatly into a long tradition of Russian
cultural expropriation. Broadly speaking, Russian cultural commissars have
always been fascinated by British art â?" in the widest sense of the term.
The
history of Anglo-Russian relations over the past century and a half is
littered with interventions of this sort â?" some perfectly straightforward,
others, to be blunt, more than a little odd.

A hundred and fifty years ago, as the first instalments of Dombey and Son
reached Moscow and were handed to the translators, Russia fell into the grip
of Dombey-mania. Crowds fought for entry to the bookshops, and society
chatter was dominated by the latest plot twists. Given Dickens's fondness for
saint-like females, his male autocrats one step ahead of a fall and the
chronic Dickensian gloom, one can understand why the tale of Mr Dombey's
downfall might appeal to the average literary-minded Muscovite. All the same,
some of the British novelists who have followed Dickens up the Russian
bestseller lists are, shall we say, a little less predictable.

It is not generally known, for example, that the most popular contemporary
British novelist in the Russia of the mid-1980s was... well, step forward,
Lord Bragg of Wigton. One doesn't want for a moment to denigrate Melvyn
Bragg's considerable literary reputation, but why should his particular brand
of fiction find such favour in, as it then was, Leningrad? The answer is that
his early accounts of tough Northern working-class folk were thought to be
authentic dispatches from the proletarian front line and safe to be studied
by the impressionable Soviet youth.

In the same way, Piers Paul Read's books â?" despite their heroes' tendency
to
convert to Roman Catholicism at the drop of a hat â?" were hugely popular in
the pre-glasnost era. Corrupt upper-class types sitting around their Chelsea
dinner-tables, slyly committing adultery with one another's wives â?" what to
home-grown readers seemed an astringent study of English mores was, to a
Russian literary apparatchik, downright anti-establishment subversion.

Inevitably, such cross-cultural shopping is ripe for serious
misunderstanding. George and Weedon Grossmith's The Diary of a Nobody has
generally been accepted â?" at any rate in England â?" as a classic
late-Victorian comedy: the story of Mr Pooter, an immensely respectable City
clerk whose self-satisfaction is repeatedly blown apart by humorous
mischance. The Diary of a Nobody had a considerable vogue in
turn-of-the-century Russia, where it was compared to Chekhov, and Mr Pooter
was marked down as an altogether tragic figure.

In the wake of this track record, the question of what a Russian audience
will make of the Teletubbies takes on a much keener significance. Will they
see the Teletubby lair, with its many conveniences and state-of-the-art
vacuum cleaner, as a rich satire of Western consumerism? Or decode the
atmosphere of communal goodwill as a poignant symbol of bygone collectivism?
My guess is that they will interpret it as a dark fable of the imprisoned
soul â?" four hapless androgynes trapped in a world of paralysing blandness
from which there is no escape. Dostoevsky for the modern age, no less.

******

#11
Newsweek-Itogi
November 13, 2000
IKEA enjoys Russian success    
Despite low salaries, Russians flock to Swedish superstore    
By Irina Rozenberg
 
 MOSCOW, Nov. 13 -  After a fire crippled Moscow's Ostankino television
tower earlier this year, a cable television channel still on the air showed
how residents of the capital were suffering without their favorite
programs. In one apartment, where the tenants griped over how empty life
was without a popular TV series, multi-colored cups of a familiar design
sat cheerfully on the shelves. The cups came from IKEA, the Swedish
superstore that since March has become the dominating force in Moscow
decor.    
    THE IKEA brand is well on its way to becoming a ubiquitous part of
Moscow life. IKEA cups, tea kettles and silverware are commonplace in many
home interiors. Holiday meals and friendly get-togethers conclude more and
more often with Russians sharing impressions from their visits to IKEA, as
well as advising those who haven't been at the store yet to be sure to go
there.
    Interest in the store is growing. Even on weekdays the showrooms are
animated, and some merchandise sells out so quickly that Muscovites
habitually call the store for weeks to ask when stocks will be replenished.
    On weekends, a trip to IKEA has become a family event. Russian parents
leave their children in the free playroom or let them roam around the
showrooms, which stretch for over a mile. The free bus service from the
subway has guaranteed IKEA a steady stream of shoppers even though the
Moscow store is located on the city's edge.
    IKEA itself didn't expect such immediate success.
    "When we made the decision to build a store in Russia, our company's
employees broke down into optimists and pessimists. The former wanted very
much to work in Russia, while the latter argued that we should take our
time with getting into the Russian market," said Lennart Dahlgren, director
of IKEA-Russia. "But even the optimists didn't expect such popularity."  
        
MONEY-MAKING PLAN
    The company drew up a five-year plan for its Russian operations.
Dahlgren said that the store is operating with a turnover that IKEA
predicted for 2005. About 8,000 people visit the Moscow store daily, and on
weekends the number of visitors reaches 20,000-25,000. Because of the large
influx of people, the management has already expanded the parking lot to
500 spaces and intends to expand the shopping area to 32,275 square feet.
    Store executives were pleasantly surprised by the fact that Russian
shoppers proved to be just like their European counterparts.
    "We thought 70 percent of our business would be in housewares and only
30 percent for furniture. But the ratio of purchases of furniture and
accessories for them proved to be 50-50, just as in Europe," Dahlgren said.
"And Russians choose the same items as Europeans. And the shoppers in
Russia, just as throughout the world, are not wealthy people but ordinary
Russian families. Look at the parking lot ... how many inexpensive cars
there are."
    In truth, one probably can't say that IKEA's customers in Russia are
statistically average citizens. At the end of each visit our shoppers leave
an average of 2,000 rubles (about $70) at IKEA, which is a sizable sum for
an average Moscow wage of about 3,500 rubles a month. Then again, the
heterogeneity of the clientele attests not only to the fact that IKEA has
caught the fancy of the most diverse customers, but also to the lack of any
alternative in Moscow. 
   Moscow had no specialized superstores with a large selection of
merchandise for the home and, most importantly, with accessible prices.
      
UNIVERSAL THEORY
    IKEA has applied to its Moscow store the same pricing policies used in
other countries. In the September catalog, which thousands of Muscovites
received, there are price increases in some items and reductions in others.
    "Price fluctuation is our policy in every country. We follow the market
of the country in which we are operating. If we see our competitors have a
similar item at a lower price than ours, we immediately lower the price on
the item. At the same time, if our competitors have a similar item at a
much higher price, we can allow ourselves to raise the price somewhat, so
as to cover costs," Dahlgren said. "And in general our prices in Russia
could be lower if it weren't for the high customs duties. We hope the
customs tariffs will drop next year, and we'll lower prices."
    Dahlgren said that IKEA plans to start construction early next year on
a second store in Moscow. Altogether the Swedish company plans to build
four big stores outside Moscow and to put in each one a large shopping
center with supermarkets, clothing stores, movie theaters, bars,
restaurants and a building-materials market.
    Itogi, Russia's leading weekly news magazine, is published in
partnership with Newsweek.
      
*******

#12
Duma is not going to send deputies as observers to US presidential elections
Russian news agency RIA

Moscow, 15th November: The State Duma has again refused to put on the agenda
the draft regulation on protecting democracy in the USA and sending a
delegation of Russian parliamentarians as observers at the US presidential
elections.

The RIA correspondent reports that the draft prepared by a number of deputies
from the Communist party faction, Agroindustrial group and Russia's Regions
was voted down in late October.

Today one of the Liberal Democratic Party faction leaders, Aleksey
Mitrofanov, spoke in favour of putting the document on the agenda. He said
that in connection with the situation at the US presidential elections the
issue of sending a group of observers, including international ones, is still
topical. "The legitimacy of the US presidential elections is important for us
because Russian-American relations, as well as the international situation,
on the who-le depend on the new president", Mitrofanov said.

However, the representative of the Duma international committee and the
Communist party faction, Aleksandr Shabanov, stressed that the State Duma had
already refused to consider the document. He also said that the
international committee had proposed that the Duma debate "a calmer" draft
document "On US presidential election", to be considered on Friday [17th
November].

******

#13
Leading Russian clergy call on authorities to counter blasphemy
Interfax

Moscow, 14th November: Russia's leading religious figures have called on the
state authorities to step up the countering of vandalism and blasphemy "in
order to protect the legitimate rights of citizens who are believers".

"We also call on journalists and statesmen to be aware of the importance of
every word they pronounce that can multiply enmity or bring about truth and
peace," says the final document of the inter-religious peacemaking forum that
ended in Moscow on Tuesday [14th November]. Patriarch of Moscow and All
Russia Aleksiy II, members of the Holy Synod, Supreme Mufti of Russia Talgat
Tadzhutdin, head of the Council of Muftis Ravil Gaynutdin, Chief Rabbi of
Russia Adolf Shayevich, head of Russia's Buddhists Damba Ayusheyev and other
religious figures attended the forum.

The religious leaders expressed deep concern over "manifestations of
extremism and terrorism that are frequently wrapped in religious rhetoric".
"Believers certainly have a right to build their life in line with their
faith. But nobody must be allowed to use the guise of words [about their
faith] to take other people's lives or trample on rights and freedoms. No
traditional religion professes this. Actions such as abductions and exiling,
depriving people of their homes and property and attempts to enforce another
religion on people are sinful," the document says.

The authors of the document note that there is a threat of imposing a choice
on the peoples of the North Caucasus and Central Asia that they do not want
and said that "terrorism and unjust violence, whatever guise they take, must
be tenaciously uprooted".

"The world community must rebuff these criminal activities in a most decisive
way. Enlightenment, dialogue and support for constructive efforts on the part
of believers must counter religious extremism," the document says.

*******

#14
Clinton, Putin discuss arms control, alleged spy
By Arshad Mohammed

BANDAR SERI BEGAWAN, Nov 15 (Reuters) - U.S. President Bill Clinton pressed
Russian President Vladimir Putin on Wednesday to release an alleged U.S. spy
imprisoned in Russia and explored Russian hints about an arms control deal.

Meeting for their fourth time this year and perhaps their final face-to-face
talks before Clinton steps down on January 20, the two also discussed Russian
weapons exports to Iran and the Russian economy as well as regional
flashpoints like the Middle East and the Korean peninsula in a 75-minute
session.

Washington has repeatedly urged Moscow to release Edmond Pope, a former naval
intelligence officer turned businessman, who was arrested in April and went
on trial on October 18 on charges of obtaining classified weapons
information.

Washington says it has seen no evidence against Pope, who has had a rare form
of bone cancer, and has called for his release on humanitarian grounds.

"The president expressed his concern about Mr. Pope's condition, in
particular his health," a senior U.S. official told reporters after the
meeting on the sidelines of the annual Asia-Pacific Economic Cooperation
(APEC) summit. "We are concerned about the course of the trial and the
president again urged release of Mr. Pope on humanitarian grounds as soon as
possible."

"The Russians understand that we won't rest until Edmond Pope is home (and)
that we are deeply concerned about his condition," he added. "We think
President Putin understands these concerns and hope he acts on them as soon
as possible."

ARMS CONTROL

The official said Washington's interest was piqued by Putin's recent
statement that Russia wanted to retain the 1972 Anti-Ballistic Missile (ABM)
treaty but was prepared to talk more and cut nuclear warheads to a previously
offered 1,500 on each side.

"We're clearly interested in President Putin's statement," said the official.
"There are a few new twists that require further study and further discussion
at the expert level and that's precisely what the president is committed to
doing."

Clinton earlier this year postponed a decision on whether to build a National
Missile Defence (NMD) shield against nuclear missiles which Russia says would
undermine the ABM pact and spark a new arms race.

But there have been some hints of Russian flexibility on the issue.

Russia's nuclear missile chief significantly shifted Moscow away from
outright rejection of U.S. anti-missile plans on Monday by offering a
counterbalancing proposal ahead of leadership changes in the White House.

General Vladimir Yakovlev, commander of Russia's Strategic Rocket Forces,
told Russian reporters it would be very difficult to persuade Washington not
to violate the ABM treaty limiting defences against nuclear attack.

"As a counterbalance to American plans to modify the treaty's references to
anti-missile defences, Yakovlev proposed 'to introduce an unchanging general
indicator of strategic weapons which would include anti-missile defence means
as well as means of nuclear attack'," Interfax news agency said.

"A country that wishes to increase one of the components will have to cut the
other," Yakovlev said.

In a sign Yakovlev's comment could be a trial balloon, Putin said Russia
wanted to retain and strengthen the ABM treaty, but was also prepared to talk
more and cut nuclear warheads to a previously offered 1,500 on each side.

"We would be prepared to consider even lower levels subsequently," he said in
a statement, adding Moscow saw no reason why deep strategic weapons cuts
would not be possible.

The U.S. official said Clinton also raised the United States' long-standing
concerns about Russian weapons exports to Iran, but did not say whether Putin
had offered any fresh assurances on the issue.

"President Putin agrees with us that these threats are real and has committed
to work hard to stem those flows," he added. "A lot more work needs to be
done."

The U.S. official said that Russia had not committed in the meeting to a date
by which it would honor a 1995 agreement under which Russia pledged not to
enter any new contracts for Iran to buy conventional weapons and to finish
shipments of existing contracts by 1999. U.S. officials acknowledged last
month that Moscow had missed the 1999 deadline.

******

#15
Russia to draft corporate governance code in 2001
 
MOSCOW, Nov 15 (Reuters) - Russia's Federal Commission for the Securities
Markets, the market's main watchdog, will begin writing early next year a
corporate governance code needed to improve the business climate, its
chairman said on Wednesday.

"Major Russian issuers already understand the importance of corporate
governance, but the further you are away from Moscow, the less understanding
you find... We will start drafting the code at the beginning of the year,"
Igor Kostikov told a corporate governance round table.

Kostikov said the government and the president realised that an improvement
in business activity standards was necessary for attracting foreign
investment to Russia, which is still recovering from a 1998 economic crisis.

Kostikov said the FCSM had invited international organisations and large
Russian firms to work jointly on the draft. He added the government had
scheduled a discussion of corporate governance issues at a meeting on
November 30.

Kostikov had previously said the Commission hoped to finish work on the draft
code by mid-2001. It has enlisted the help of the Organisation for Economic
Cooperation and Development, the World Bank, the International Finance
Corporation and the European Bank for Reconstruction and Development.

******   

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