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Johnson's Russia List


November 20, 2000   

This Date's Issues:   4643  4644


Johnson's Russia List
20 November 2000

[Note from David Johnson:
1. Christian Science Monitor: Fred Weir, Glory beneath Moscow streets. The 1930s Metro still clips along with Soviet-era efficiency - and a little glamour
2. Itar-Tass: Union of Right Forces May Be Transformed into Party
3. Reuters: Prosecutors summon top Russian journalist. (NTV's Yevgeny Kiselyov)
4. Rodric Braithwaite: Stalingrad: The Snipers' Duel.
5. Dmitri Glinski-Vassiliev: re Rokhlina.
6. The Russia Journal: Yelena Rykovtseva, Media watch: New generation of oligarchs prepared to stake its claims 
7. The Globe and Mail (Canada): 'Nobody told us anything.' How safe is nuclear technology? Moscow correspondent GEOFFREY YORK travels to Siberia to visit Valentin Olenyov and his neighbours on the banks of the Tom, recently declared the world's most radioactive river.
8. Itar-Tass: Russia's Putin marks treaty anniversary, calls for quick approval of amendments. (CFE)
10. Moscow Times: Anna Raff, Execs Rub Shoulders at IFC Forum.
11. Eric Kraus: The Autumn of the Oligarch - Epilogue.] 


Christian Science Monitor
20 November 2000
Glory beneath Moscow streets
The 1930s Metro still clips along with Soviet-era efficiency - and a little glamour. 
By Fred Weir

Here in Russia, red tape sill ensnarls most aspects of life. Getting your 
phone hooked up can take months. And, please, let's not even talk about 
landing a permit to add a new bedroom to your apartment. 

But the subway works like Swiss clockwork. The average wait at the Moscow 
Metro's 158 stations is just 90 seconds during rush hour. 

Just below the hard, gritty Moscow surface - about 300 yards - one of the 
Soviet era's most famous symbols of Communist efficiency continues to bring 
world- class service and daily inspiration to the city's beleaguered 

"When I go down into the Metro, it feels like time has frozen, and it could 
be 1960 or 1980 again," says Svetlana Tretyakova, a pensioner. "It was one of 
the things about our life that always worked well. You rarely ever heard 
anyone complaining about the Metro, and you still don't." 

Best known for its palatial downtown stations, adorned with marble columns, 
chandeliers, beautiful mosaics, and stained glass windows, the Metro was 
built in the 1930s to instill pride in the Russian proletariat and to awe the 
world. Today it remains almost as spotlessly clean and graffiti-free as in 
Soviet times, when a special Metro police force watched over it with 
unblinking eyes. 

While downtown Moscow is virtually paralyzed with traffic, the Metro smoothly 
moves 9 million people daily. 

"No delays so far today on this line," says Irina Malyugina, who works as a 
signal person at the downtown station of Oktyabrskaya. "People say we work 
well compared to Metro systems in other parts of the world." 

Originally built to double as bomb shelters - which they did during World War 
II - Moscow's downtown stations are among the deepest in the world. In many 
stations, the cold-war-era enclosures housing giant nuclear-resistant doors 
are clearly visible. 

The Metro may be bombproof, but it is not comfortable. The standard ride 
involves hard benches, dim lighting, and doors often slam without warning. 
Beggars wandering through the cars are another sign that times have changed. 

Despite all that, an old-fashioned sense of order prevails and the mood is 
surprisingly good natured. Any young person who grabs a seat, if someone 
older is standing, may expect a gentle poke in the legs with a cane or 

"We inherited an awfully good basic structure, and we have just kept that 
running," says Konstantin Cherkassky, information director for the Metro. 
But, he says, underfunding is taking a toll, and some stations may have to be 
shut down without major new investment. 

"What people don't see are the accumulated problems of metal fatigue, 
mechanical breakdown, and understaffing," Mr. Cherkassky says. "If we don't 
increase our income, these problems will catch up with the Metro in time." 

Ironically, the main reason for the Metro's post-Soviet financial crunch is 
... communism. According to still-upheld Soviet customs, more than half the 
people who ride the Metro every day don't pay a kopek. That includes 
pensioners like Ms. Tretyakova, municipal workers, soldiers, invalids, 
federal civil servants, priests, small children - over 100 categories of 
people in all. 

For those who do pay, the fare is just 5 rubles (about 18 cents), for 
unlimited access to the system's nine lines, totalling 118 miles. 

"It's not cheap. It really adds up if you ride twice a day," says Olga 
Smirnova, a teacher. Her salary, fairly typical in Russia, is $65 per month. 
"But compared to other prices, it seems more reasonable." 

One thing Metro officials really hate to talk about is accidents. They claim 
to have no statistics. It is known that about 50 people annually commit 
suicide - perhaps taking their cue from Lev Tolstoy's heroine Anna Karenina - 
by throwing themselves beneath onrushing Metro trains. 

"We have about 60 cases of smoke every year, and sometimes there is fire 
too," says Cherkassky. "Occasionally there are fights," he adds. "Vandalism 
is a growing problem. We all dread nights when there are football (soccer) 
games in Moscow. We need a lot of extra police. Young people today can be 
quite unruly." 


Union of Right Forces May Be Transformed into Party. .

MOSCOW, November 19 (Itar-Tass) - The Duma faction of the Union of Right 
Forces had a session in the Moscow region from Friday through Sunday. The 
faction members called for transformation of the Union of Right Forces, a 
coalition of the union founders, into a political party in the first half of 
next year. 

The session was also attended by Anatoly Chubais, a leader of the Union of 
Right Forces and top manager of the Unified Energy Systems of Russia grid. 

The faction members said that they would have another session at the end of 
January to take a final decision on the transformation, set a date of the new 
party's constituent congress and discuss drafts of the party program. All 
leaders of the Union of Right Forces and faction members supported the idea 
to disband all the nine organizations that make up the union first and 
reconstruct the union as a party on the basis of individual affiliation. 

They also spoke about leaders of the future party, which was one of the most 
painful problems. Most of the faction members agreed to raise the question at 
the constituent congress. So far, they favor the institute of party 

Leader of the Democratic Choice of Russia Party Yegor Gaidar, who has been 
described by some mass media as an opponent of liquidation of the association 
of founders and establishment of the party, said at the session that he 
supported the idea and did not think that it would bring to nil the whole 
work of his organization. 

The attitude of the Union of Right Forces to the authorities was discussed, 
as well. The faction members said they will support any moves of the 
authorities that comply with their program and principles and be in 
opposition to other moves. 

The faction decided to continue a policy of merging with the Yabloko 


Prosecutors summon top Russian journalist
By Peter Graff

MOSCOW, Nov 19 (Reuters) - Prosecutors have summoned the top journalist at
Russia's embattled NTV television for questioning, a correspondent at the
station said on Sunday. 

The news came just two days after NTV effectively lost its status as
Russia's only independent nationwide television channel, when the
state-dominated natural gas monopoly Gazprom announced it had become the
station's largest shareholder. 

Correspondent Alim Yusupov, reached by telephone, said that Yevgeny
Kiselyov, NTV's general director and host of its flagship political
commentary show Itogi, had been summoned for questioning on Monday. 

"He has to appear (at the prosecutor's office) at 2:00," Yusupov said. NTV
had earlier announced the summons by sending a statement to the Interfax
news agency, shortly after Kiselyov's Sunday evening broadcast ended. 

"He says that beyond the statement sent to Interfax he will make no
comment," Yusupov said. 

It was not clear if Kiselyov had been aware of the summons during his
broadcast, in which he briefly discussed the channel's new ownership. 

Kiselyov is one of the most influential journalists in Russia, and his
Sunday show has been known for hard-hitting reports that have increasingly
taken on the Kremlin. He interviewed U.S. President Bill Clinton last year. 

The Interfax statement quoted NTV's press service as saying that the
station did not know what case lay behind Kiselyov's summons, but believed
it may have been linked to a newscast from several years ago. 


NTV was Russia's only independent television channel with nationwide reach
-- and by far the most influential source of news outside the Kremlin's
control -- until Friday, when Gazprom said it had become the station's
largest shareholder. 

Gazprom does not have enough voting shares by itself to sack staff at NTV,
and Kiselyov said on his programme that this would mean the station would
retain editorial independence. 

The Gazprom announcement marked the end of a months-long feud for control
of NTV that raised accusations of a clampdown on free press under President
Vladimir Putin. 

Vladimir Gusinsky, head of the Media-Most group that owned NTV, lost
control of his empire after being forced to sell shares to Gazprom to pay
off debts that the gas monopoly had guaranteed. The state is the largest
shareholder in Gazprom and effectively controls it. 

Gusinsky had battled to keep his grip on Media-Most, saying the Kremlin was
threatening him with prosecution as a way of stifling criticism, and using
the debt to Gazprom as a lever to win control of his media holdings. He was
briefly jailed in May. 

Gazprom said it only wanted to get its debts paid. 

Gusinsky is now in exile abroad and wanted by Russian police after refusing
to appear for questioning in a fraud case last week. Boris Berezovsky,
another Russian media magnate, also refused to return to Russia last week
for questioning in a separate criminal case. 


Date: Sun, 19 Nov 2000 
Subject: Stalingrad: The Snipers' Duel
From: Rodric Braithwaite <>

As far as I remember, the duel between Zaitsev and Koenig (see list 4641)
figures in the Stalingrad section of Ozerov¹s epic film about the Second
World War. Unfortunately I don¹t have access to my copy, so can¹t check. But
if the story is a myth, I suspect it is a Soviet myth, not a Hollywood one.

Ozerov¹s film is available on about ten cassettes in the Moscow stores. It
was made in the second half of the 1980s on a grandiose scale: there seem to
be more tanks in the Kursk scenes than took part in the actual battle

As a piece of historiography the film is fascinating. It is very frank about
the initial disasters in 1941 and Stalin¹s personal responsibility. It shows
the famous panic in Moscow in October 1941. It shows soldiers who have
escaped from encirclement being rounded up and shot by the NKVD, and touches
on the role of the NKVD in Stalingrad itself. It is particularly interesting
in its portrayal of Stalin, and his relationship with his generals,
especially Zhukov. It is positive about Khrushchev. The final shots of the
whole film tell the viewer how Stalin, Zhukov, and Khrushchev were all
successively accused of cultivating their personality, and airbrushed out of

The film exists in different versions. In 1990 a very long episode about the
fall of Smolensk was shown on TV which is omitted from the cassette version.
So is an episode showing an elderly Russian woman giving bread to a German
prisoner after the victory at Stalingrad, which was in the version I saw in
a Moscow cinema also in 1990.

I have asked a number of Russians what lay behind the making of the film,
which must have been horrendously expensive, even in Soviet terms. I assume
it was an attempt by the Soviet armed forces to glorify a reasonably
accurate version of their role during the war. If anyone has an explanation,
I¹d be interested.

There is also a rather bad German film about Stalingrad, made by the same
team that made Das Boot.


From: "Dmitri Glinski-Vassiliev" <>
Subject: re Rokhlina
Date: Mon, 20 Nov 2000 

Patrick Cockburn's somewhat peremptory treatment of the Rokhlina case in his
Independent article (JRL 4642) strikes me as sort of premature. His article
takes the court verdict in this highly controversial case at face value,
although the basis for the verdict is widely seen as very very flimsy.
Indeed, the judge even issued a reprimand to the General Prosecutor Office
for the careless conduct of the investigation (which had failed to establish
any factual evidence linking either Rokhlina or anybody else to the murder).
The article's attempts to substantiate the story with innuendoes about
Rokhlina's character and drinking habits coincide with the official
prosecution line which naturally reflected government interest in this case.
Given that Rokhlina's lawyers announced they would appeal the verdict up to
the European court, it would be wise to reserve the final judgement. There
are regrettable factual errors as well: Rokhlin did not resign "in disgust
from the army" - neither in 1995, as the article claims, nor afterwards. In
1995, he declined an official award presented to him for his military
actions in Chechnya.


The Russia Journal
November 18-24, 2000
Media watch: New generation of oligarchs prepared to stake its claims
By Yelena Rykovtseva / Media Editor for Obshchaya Gazeta 

The era of Boris Berezovsky and Vladimir Gusinsky in the Russian media is
coming to an end. Back in March, the dean of Moscow State University’s
journalism faculty, Yasen Zasursky, said, "The capital’s press is divided
into two camps – the Berezovsky camp and the Gusinsky camp." He couldn’t
say the same words today.

Berezovsky today doesn’t have the slightest influence on national TV
channel ORT. He formally controls 49 percent of the shares, but he doesn’t
control the most important thing – the channel’s policy. 

As for Gusinsky, he is still fighting to keep at least 35 percent of his
shares in NTV. But so far, this is to no avail – the peace agreement that
was to be signed Nov. 14 between Gazprom and Media-MOST didn’t go ahead. 

Whatever the case, what is clear today is that the state has managed to
crush the two oligarchs using force, threats of imprisonment and criminal

But if Berezovsky and Gusinsky leave the stage, who will step in to their
places? If President Vladimir Putin thinks the oligarchs’ media outlets
will go to the Kremlin, he is mistaken. Following in the footsteps of
Gusinsky and Berezovsky is a small and very united group of six young

The first of them is Media Minister Mikhail Lesin. According to Media-MOST
spokesman Dmitry Ostalsky, "Lesin took a most active role in making sure
the agreement didn’t get signed." 

The agreement wouldn’t have given Gazprom control over NTV’s editorial and
personnel policies. But Lesin, together with his business partner, Video
International President Yury Zapol, had just proposed to advertisers that
they conclude contracts for buying advertising time on NTV directly from
Video International, saying it would soon have control of Media-MOST. 

• Defending interests

This looks convincing, especially as Video International, which Lesin
founded, already controls most of the advertising market and has exclusive
rights to sell advertising time on ORT and RTR. Lesin and Zapol’s only
desire is to extend their sphere of influence. 

Yury Zapol is thus the second oligarch in the group. The others are ORT
General Director Konstantin Ernst, VGTRK (state broadcasting) General
Director Oleg Dobrodeyev, RIA-Novosti information agency General Director
Vladimir Kulistikov, and VID production studio President Alexander Lyubimov. 

Four of these people are ostensibly state officials, while the other two
are directors of commercial companies. But dividing the group into state
and private sector representatives is just a formality – in reality, the
group is bound together by business interests. Mikhail Lesin hasn’t broken
his ties with Video international. RIA-Novosti also has close ties with
Video International, and Lesin used to head a sub-department of RIA-Novosti
called TV-Novosti. 

The two state TV companies – ORT and VGTRK – are the largest vehicles for
advertising in the country. This draws the directors of the two companies
directly into the advertising business, and they are thus closely linked to
Video International. VID production studio sells most of its programs to
ORT, and this means the company’s commercial interests are closely linked
to those of ORT.

• The media pie

All these oligarchs, who are all close in age (around 40) have become so
close of late that they even celebrate some family holidays together. But
they are not in a celebratory mood at the moment. Looking at the
misfortunes of Berezovsky and Gusinsky, they’re well aware that if today
it’s these two up against the wall, tomorrow it could be them. 

The group fears the Kremlin, is afraid of Putin and doesn’t want to give up
control of such a huge slice of the media pie. But at the same time, the
group has to stay on good terms with the Kremlin, especially as four of its
members were appointed by Putin.

This is why such a complex game is now under way. Russia always had a
journalists’ union, the role of which was to defend journalists. 

The union was always headed by bureaucrats rather than professional
journalists, and therefore had little authority in the capital’s media. 

But nonetheless, the union managed to be a thorn in the Kremlin’s side all
last year as it issued statements denouncing Putin’s policy toward Radio
Liberty journalist Andrei Babitsky, Gusinsky and Moscow Mayor Yury Luzhkov,
the owner of TV Center, which he came close to losing in March. Seeing as
there’s only one journalists’ union in the country, the international
community had little choice but to listen to it carefully.

The Kremlin has long wanted to set up an alternative journalists’ union so
as to devalue the current, inconvenient one. But it hasn’t worked so far
for lack of strong allies in the media. Suddenly now, though, they’ve

President of TV Center Oleg Poptsov said on Echo Moscow radio that at a
Nov. 1 meeting with head of the Presidential Administration Alexander
Voloshin, Lesin said, "There’s an idea to create a new journalists’ union,
and there’s a good candidate to lead it – Alexander Lyubimov." (That former
business competitors Lyubimov and Lesin should have come close together is
interesting in itself.) 

• Journalists’ rights

To all appearances, Voloshin approved both the idea and the candidate. Two
days after this meeting, Lyubimov spoke to the editors of the main Moscow
media outlets and outlined the idea for the new union, saying nothing, of
course, about unpopular Minister Lesin’s participation in the project.
Lyubimov said all the right things about the need for a strong professional
organization that would have the authority to defend journalists’ rights.
The chief editors promised to think over the idea, not guessing that it had
a double bottom. 

The group of young oligarchs is most likely playing a double game with the
state, because it has two tasks at hand. Firstly, it hopes to get state
support for its new organization. This is entirely possible, given that the
state has long dreamed of having an obedient journalists’ union. But at the
same time, the new organization will make it easier for Lesin, Lyubimov and
Co. to defend their business interests from the state should it decide to
go after them. 

It’s doubtful whether rank-and-file journalists will go along with the
idea. The group is going to have a hard time keeping secret the fact that
the hypothetical new union is not a journalists’ union, but a union of the
young Moscow oligarchs.


The Globe and Mail (Canada)
18 November 2000
'Nobody told us anything'
How safe is nuclear technology? Moscow correspondent
GEOFFREY YORK travels to Siberia to visit Valentin Olenyov
and his neighbours on the banks of the Tom, recently declared
the world's most radioactive river.

The case of the deadly ducks began with an August hunting trip near Tomsk in 
western Siberia.

Along with shotguns, the hunters were armed with portable dosimeters. They 
were, after all, prudent citizens of Russia's infamous "nuclear archipelago," 
where massive nuclear complexes were operating secretly during the Cold War, 
and they knew enough to test their birds for radiation.

The readings were unusually high, so the hunters gave three of the ducks to 
the local environmental office. Further testing confirmed their suspicions: 
"If you had eaten one of the ducks," said Yuri Zubkov, head of the federal 
Department of Ecological Safety in Tomsk, "you would have gotten your annual 
maximum limit of radiation."

Mr. Zubkov immediately swung into action. He knew the source of the danger: 
Tomsk-7, the huge nuclear power complex about 15 kilometres north of the city.

Plagued by financial problems, it could no longer afford the armed guards it 
once employed to drive off wildlife from the poisoned lakes within its 
68-kilometre-long perimeter fence.

Now, migrating ducks were free to land and feed on fish tainted by leakage 
from the plant's liquid-waste reservoirs, which contain twice as much toxic 
material as that released during the Chernobyl disaster.

Radioactive ducks, fish, pigeons and elk are just the first warning signs of 
danger in Tomsk, which sits on the Tom River.

"We worry very much about this," Mr. Zubkov said. "The chain leads from the 
river to the fish and then to the humans. Several thousand ducks fly over 
this territory every year, so it causes an uncontrolled spread of 
radioactivity. It's a very serious problem."

He fired off a letter asking that the complex reinstate its guards and keep 
the ducks away. He is still waiting for a response.

But the situation may be much worse than expected. This month, a team of 
Russian and U.S. environmentalists announced that tests conducted downriver 
from Tomsk-7 show that the Tom River, which flows northward into the Ob 
River, a major transportation artery that empties into the Arctic Ocean, is 
the most radioactive waterway on the planet.

The radioactive waste emanating from Tomsk-7 "appears to be the largest 
discharge of nuclear contaminants into the environment anywhere on the 
globe," the team's report said.

It called the discharge "staggering" and "greater than any previously 
reported river contamination, even at the height of the Cold War."

The level of radioactive strontium-90 in the Tom River is 30,000 times the 
maximum allowed in U.S. drinking water, the report said, adding that it 
represents "a clear and present danger to human health."

Local environmental officials deny that the levels are as high as those 
reported, but they confirm that radioactive water and wildlife are a genuine 
threat to human health.

Environmentalists point to Tomsk-7 as a classic example of what can go wrong 
with nuclear power, which is being advocated at a climate-change conference 
in The Hague as a means of reducing greenhouse-gas emissions.

In 1996 and 1997, inspectors found that market vendors in Tomsk were selling 
highly radioactive fish, which had been apparently caught in a reservoir on 
the nuclear plant's territory.

"We've been warning of the dangers since 1993," Mr. Zubkov said. 
"Unfortunately, the nuclear plant is inside a secret closed territory. There 
is no state control over the reactors, and there is still no law in Russia 
forcing them to pay for their pollution. We can issue demands, but we cannot 
fine them or sue them. We don't even have permission to enter their 

Tomsk-7 was the world's biggest military nuclear complex during the Cold War, 
when its five reactors produced weapons-grade plutonium for the Soviet 
nuclear arsenal.

Two of the five reactors continue to operate, producing plutonium for the 
military and supplying electrical power for the region.

Tomsk-7 is contained within a larger nuclear city, officially called Seversk.

The complex is surrounded by four rows of barbed wire, towers with armed 
guards and a footstep-monitoring belt. Outside is a "sanitary zone," where 
nobody is supposed to swim, boat, or eat mushrooms, plants, berries, 
vegetables or fish -- although many people regularly do. Many villagers also 
gather hay and water for their cattle in the zone.

Farther downriver, the Tom is unguarded. "People are accustomed to drinking 
from the river," said Alexei Toropov, an environmentalist in Tomsk. "They 
aren't aware of the danger. The water is open and available to everyone. 
That's what makes it so dangerous."

Valentin Olenyov, 64, who lives in Samus, a town of several thousand people 
less than 15 kilometres from the nuclear plant, shrugged indifferently at 
suggestions that he is living beside the world's most radioactive river.

At the age of 64, he has spent all his life here. He drinks the Tom River's 
water, eats its fish and consumes milk from cows that graze on its banks.

"We lived here many years and nobody told us anything," said Mr. Olenyov, 
gathering firewood for the long Siberian winter. "Now suddenly they tell us 
the river is bad. We are just ignorant people. How can we tell?"

When told about the latest environmental study, he was not particularly 
surprised. "I'll never move away," he said. "Where would I go? I've lived 
here all my life. Maybe it's bad, but we've gotten used to it."

In 1993, several towns near Tomsk, including Samus, were dosed with radiation 
after the accidental explosion of a tank of liquid radioactive waste, which 
spewed radiation over a 250-square-kilometre area.

Luckily, the wind was blowing away from the city of Tomsk, which has almost 
500,000 residents. "It would have been catastrophic if it had hit Tomsk," Mr. 
Zubkov said.

Many residents of Samus still suffer high levels of radiation because of the 
1993 accident and 30 other smaller accidents since 1961, along with the 
cumulative effects of consuming tainted fish and water.

One scientific study in the mid-1990s found that the radiation damage in 
blood cells among Samus residents was as as bad or worse than the damage 
among cleanup crews at the Chernobyl disaster. Much of it was due to 
contamination from the nuclear plant as far back as the 1960s, the study 

Another study found that fishermen, who consumed the heaviest diet of fish, 
had the highest radiation levels among the Samus residents. Some had levels 
100 times the natural dose from background radiation.

Other studies found that a large percentage of the Samus population had 
suffered chromosome damage or depressed immune systems as a result of 
radiation. Thyroid cancer rates in the Tomsk region have increased sharply in 
recent years.

The contamination has spread far beyond Tomsk. Radioactive material from 
Tomsk-7 has been found thousands of kilometres away in the Arctic Ocean. 
Pollution from other Siberian nuclear plants has also reached the Ob River, 
exacerbating the radioactive contamination in the Russian Arctic .

Another serious problem is the underground storage of nuclear waste at 
Tomsk-7. The amount of radioactive material stored in the soil is 20 times 
the amount discharged in the Chernobyl disaster, Mr. Zubkov said. "We are 
very worried that this material could get into the drinking water some day. 
We constantly test the drinking water." 

Tomsk-7 is still officially called the Siberian Chemical Complex, a name 
created during the Cold War to conceal its nuclear function.

After the collapse of the Soviet Union, when the environmental movement began 
to flourish, the plant realized that it had a public-relations problem. It 
distributed posters around Tomsk, trying to repair its battered image. 
"Radiation in small doses could even be good for your health," they 
proclaimed cheerfully.

After the report on the Tom River, the nuclear plant responded with denials 
and threats of libel action. The Natural Resources Ministry accused the 
Russian and U.S. environmentalists of working "under contract" for Western 
interests in an effort to discredit Tomsk-7 so that it would lose foreign 
markets for its nuclear technology.

Local environmental officials are less hostile to the report. They believe 
that the team made methodological errors that exaggerated the level of 
radiation in the Tom River.

But they also believe that the controversy could be good for their cause. "It 
attracts attention to the environment," Mr. Zubkov said.

The villagers, meanwhile, are not sure whom to believe. "They test the water 
and they say it's safe, but we don't know," said Maria Kolmagorova, who has 
owned a house in Samus for 10 years.

"Cows that graze here are getting sick," she said. "We're afraid that our 
grandchildren could get sick. We are thinking of moving, but we don't have 
anywhere to go. We can't afford to move away and start a new life."


Russia's Putin marks treaty anniversary, calls for quick approval of amendments 

Moscow, 19th November: President Vladimir Putin has made a statement on the 
occasion of the 10th anniversary of signing the Conventional Armed Forces in 
Europe (CFE) Treaty. The statement obtained by ITAR-TASS from the Kremlin 
press service runs as follows: 

"The 10th anniversary of signing the Conventional Armed Forces in Europe 
Treaty, a document that plays a key role in strengthening European security, 
is marked on 19th November. 

"An efficient regime of control over conventional armaments and an 
unprecedented openness in the military sphere came into being across the 
continent for the first time ever. The treaty made possible a quick and 
balanced reduction of a large quantity of superfluous armaments and hardware 
inherited by its signatories from the Cold War era. It helped them to live 
without shocks through momentous changes in the military and political 
scenery of Europe in the past decade. 

"It won't be an exaggeration to say that there have been threats to the very 
existence of the CFE Treaty in the past decade. They remain now. It is 
important that the signatories display concern, in the future too, for 
preserving the regime of control over conventional weapons and do not subject 
it to dangerous tests. I have in mind attempts to hamstring stability in the 
sphere of nuclear weapons, poorly thought-out bloc policy, use of force 
bypassing the UN Security Council or other actions running counter to 
security interests of OSCE partners. 

"Due account for these interests will enable the participants in the treaty 
to find a way out of the most difficult situations. The events in Chechnya 
are one of the latest examples. Russia values the understanding displayed for 
our forced measures to counter the large-scale terrorist aggression, which 
resulted in a temporary topping of flank limits. 

"Alas, the situation in the North Caucasus still remains complicated. Under 
these conditions and taking into account the obligations taken a year ago, we 
are doing our best to ensure maximum transparency in our actions to protect 
Russia's state interests. They are not aimed, in any way, at infringing upon 
the national security of countries in the region. On the contrary, they are 
aimed at gradual reduction of weapons and materiel (temporarily stationed in 
the region) which are covered by treaty limitations. 

"We reaffirm the adherence of Russia to all obligations taken under the 
treaty, including the flank limitations, and state that we will obligatorily 
return to them after the end of the antiterrorist campaign. 

"The problem of pulling out Russian troops from the territories of Georgia 
and Dnestr is being solved in compliance with the bilateral accords reached 
in Istanbul and with the interested support of our partners in the CFE 

"I am confident that the soonest entry into force of the agreement on CFE 
adaptation will strengthen the treaty's vitality and make it an efficient 
instrument in the provision of the continental security in the 21st century. 
There are no reasons to drag out the process of ratification of the adapted 
CFE accord. This is our firm stand. We are finalizing preparations to submit 
the document to the State Duma of the Russian Federal Assembly for 
ratification. I do not doubt that it will enjoy the support of deputies. 

"Several weeks from now, mankind will enter a new millennium. I would like to 
wish peace and accord to our partners in the CFE Treaty, and a lasting 
existence to the treaty for the sake of strengthening security in Europe." 


Chicago Tribune
19 November 2000
By Colin McMahon 
Tribune Foreign Correspondent 

VITEBSK, Belarus -- Even if Marc Chagall could not go home again, his art has 
finally found a place in the city of his birth.

For decades during Soviet times, Vitebsk all but denied that Chagall existed, 
but the Belarussian city has now embraced the artist, with two museums 
honoring his life and his work.

Like Chagall's childhood a century ago in the Jewish quarter of Vitebsk, the 
museums are humble. They contain none of Chagall's famous works. They offer 
no multimedia shows or interactive displays. They often lack heat.

Yet the very existence of the museums shows how Vitebsk, Belarus and 
neighboring Russia have warmed to Chagall since the collapse of the Soviet 
Union a decade ago. They also give Chagall's admirers a chance to better 
understand the place and time of Chagall's life that so greatly influenced 
his art.

"If you asked people in Vitebsk 15 years ago--even 10 years ago--if they knew 
who Marc Chagall was, few if any could answer," said Arkady Podlipsky, a 
local journalist who has written books on Chagall and Vitebsk. "Now nearly 
everyone here would know, and they are proud."

The turnaround is so complete that the museums count among their most visible 
supporters former communist officials who once made Chagall disappear.

Less than a decade ago, the residents of Chagall's old house had to hold 
impromptu tours for the dedicated art lovers who came on unscripted, 
uncharted pilgrimages.

That home was made into a museum in 1997. A statue at the corner now points 
the way. A plaque marks the spot, and a guide describes how the 
Chagalls--Marc was the oldest of eight children born to a devoutly religious 
herring salesman--managed in a squat house of four rooms.

The second Chagall museum, across the Western Dvina River on the other side 
of town, houses a small but growing collection of Chagall's art. Among the 
works is the last that Chagall ever did.

Thanks to Chagall and especially Kasimir Malevich and his Suprematism 
movement, Vitebsk became a center of the avant-garde after World War I. But 
Chagall soon parted with Malevich and with the ever more demanding Communist 
Party political masters.

Chagall left the Soviet Union in 1922. Though he planned to return, Soviet 
authorities planned otherwise. They would not allow Chagall back into the 
USSR until he was an old man and then only for a visit to Moscow. They never 
granted Chagall passage to Vitebsk, just inside the Belarus border about 250 
miles northwest of Moscow.

Chagall died in 1985 in France, his adopted home and the country with which 
many art fans most closely identify him. He was 97.

The separation from his homeland gnawed at Chagall, who referred to Paris as 
"my second Vitebsk."

Vitebsk was not only Chagall's birthplace; it also provided inspiration. Many 
of his works--"I and the Village," for example, and "The Rabbi of Vitebsk," 
which belongs to the Art Institute of Chicago--draw on the rhythms and 
traditions of Jewish life before World War I.

"It seems that the whole history of painting never knew an artist so attached 
to his native city as Chagall," wrote Ilya Ehrenburg, an officially 
sanctioned Soviet writer who kept in touch with Chagall through much of the 
Stalin era.

Ehrenburg said that when he saw Chagall in Paris before World War II, the 
artist was busy painting a series of little houses from Vitebsk. When the two 
met in New York in 1946, Chagall talked about little else besides Vitebsk's 

Chagall had been arrested in Paris in April 1941, but the United States 
intervened, securing Chagall's release and, most likely, saving him from the 
Holocaust. He spent most of the 1940s in America, working to raise money for 
the Soviet war effort and worrying about his hometown.

In 1944, Chagall wrote a valentine to Vitebsk, publishing it in a leading 
Jewish newspaper:

"For a long time, my beloved city, I haven't seen you, I haven't heard from 
you, I haven't talked to you and to your people. My Motherland, I left in 
your land the ancestors' graves and the scattered stones.

"I did not live with you, but there was not a single picture of mine that 
would not reflect your pride and grief."

Indeed, Chagall once said, the Vitebsk of his art was "the town of my 
childhood, where I can enter without visas and passports."

Vitebsk today bears little resemblance to the city of Chagall's time.

Relatively few Jews remain among the population of 375,000. Those who 
survived Russian pogroms, Soviet repression, the Nazi occupation and still 
more Soviet repression either emigrated or assimilated. A city once dotted 
with more than two dozen synagogues now has one.

This change was made clear when the art museum tried to prepare an exhibition 
called "Chagall and Jewish Culture."

"Knowing we did not have objects from Jewish family life, antique materials 
and such, I spent a whole year looking for them in the museums of Belarus," 
said Ludmila Khmelnitskaya, who directs the Marc Chagall Museum.

"This is a cultural layer that has totally disappeared," Khmelnitskaya said. 
"There were no Jewish pogroms during Soviet times, but there was state 
anti-Semitism. Museums just did not collect Jewish things. Everything we 
found we found through private donors."

Private donors, almost exclusively from outside impoverished Belarus, are 
driving the Chagall renaissance in Vitebsk. A German collector has turned 
over dozens of works to Khmelnitskaya's museum. Funds also are being raised 
for a Chagall library at the museum.

Khmelnitskaya knows how far this has all come, and how fast.

In 1987, when the world was celebrating the 100th anniversary of Chagall's 
birth, the communist authorities of Vitebsk waged an anti-Chagall campaign. 
He was excised from an artwork designed to honor three Belarussian artists. A 
celebration in his name was canceled two days before it was to be held.

"During his long life Marc Chagall learned a lot," Podlipsky wrote. "He had 
bad luck and success, knew hunger and material well being, indifference and 
world glory. There was only one thing he was deprived of: recognition in his 
motherland. And he suffered very much because of that."


Moscow Times
November 18, 2000 
Execs Rub Shoulders at IFC Forum 
By Anna Raff
Staff Writer

Judging by the number of security personnel guarding the Marriott-Tverskaya 
Hotel on Friday afternoon, the meeting about to start on the eighth floor was 
not your typical business seminar. 

>From mid-afternoon, the Kaminnaya room, decorated in green tones, was the 
setting for high-level discussions between U.S. investment funds and some of 
Russia's largest companies, coordinated by the International Finance Corp., a 
member organization of the World Bank group. 

"We definitely achieved a mutual understanding," said Valery Goldin, head of 
investor relations at Vimpelcom, minutes after the meeting ended. "In 
essence, it was a general discussion about the conditions that need to be 
created so more capital comes to Russia." 

Talks didn't concentrate on details, such as the universal corporate 
governance principles developed by the Organization for Economic Cooperation 
and Development, because all the attendees already consider such rules 
absolutely necessary, Goldin said. 

The OECD code includes catch phrases such as a "focus on long-term financial 
returns" and "ensured shareholders' voting rights," concepts that are not 
always adhered to in Russia's developing market. 

Goldin said the gathering was the beginning of ongoing and direct 
communication between local managers and investors. More meetings of this 
sort will probably follow. 

"The IFC is trying to get a dialogue going about what corporate governance 
should look like in Russia," said James Fenkner, equity strategist for Troika 
Dialog, who spoke at a meeting ahead of the talks. "They might be trying to 
get a code of principles published." 

Fenkner said the failure of local businesses to disclose ownership structures 
is one of the chief reasons that investors stay out of the market. 

Local companies are notorious for having complex ownership structures 
consisting of holding companies registered under third-party names. Such an 
opaque system hides the transfer of assets from one arm of a company to 
another, clearing the road for the dilution of share value and tax evasion. 

Gazprom, Mosenergo, Sberbank, Severstal, Sibneft, Unified Energy Systems, 
Unified Machinery Factory (formerly Uralmash), Vimpelcom, Aeroflot and Yukos 
were invited to participate in the roundtable. 

>From the U.S. side, the California Public Employees' Retirement System, or 
CalPERS, the State Street family of funds, Templeton, Fidelity, Morgan 
Stanley, Capital Group and Sun Group were slated to attend. 

Ken King, director of Rexiter, a State Street subsidiary in South Korea, was 
expected to speak on the creation of a new fund in Russia, Segodnya newspaper 

Similarly to the one King advises in South Korea, the fund would pick local 
companies and bring them up to a level conducive to additional investment. 

Faced with a rickety infrastructure, Russia needs this kind of investment 
badly. With oil prices skyrocketing and reserves falling, Russian oil 
companies announced that they don't have the capability to pump more oil, 
even though they have the desire. 

Gross domestic product is projected to grow by 6.5 percent this year, but 
though this rate is comparable to 1997's rate, investment is still flat, 
Fenkner said. 

The meeting was closed to the press and the public, evoking the question of 
transparency. Both multinational organizations and individual domestic 
companies have repeatedly promised to make their activities more transparent 
to the public and, more importantly, shareholders. 

"There was never any discussion of having any press," said IFC staffer 
Viktoria Androsova . "It was created strictly as a working group." 

Delegations arrived in the plush Marriott lobby in full form. Most were 
accompanied by bodyguards who strolled in and performed visual checks before 
giving the all clear. 

Minutes before the meeting, a crowd gathered around the elevators on the 
first floor because some access card keys had apparently malfunctioned. 

The eighth floor could also be reached with the help of any hotel guest who 
possessed such a key card. There, Holly, an IFC representative in a light 
green suit, was pacing the corridors, talking about "security measures" and 
"critical points." 

"We don't allow press," Holly said, with a shocked expression on her face. 
She then ran to meet the first of the attendees f and their bodyguards. 


From: Eric Kraus <>
Subject: The Autumn of the Oligarch - Epilogue 
Date: Fri, 17 Nov 2000 

The Autumn of the Oligarch - Epilogue

As we predicted several months ago (see The Autumn of the Oligarch, August 
1, 2000 - copy available on request), the erstwhile oligarchs were offered 
a deal which, on the face of it, they would have been mad to refuse: their 
ill-gotten gains were theirs to keep, provided that they refrained from 
further outright pillage (of the Russian State at least) and especially, 
that they relinquish any pretension to political power. Boris Berezovsky 
(BAB) and "The Family", in particular, were served notice that their 
assistance is no longer required. The Berezovsky story is easiest, so we 
address it first. 

Soaring on the Wings of Aeroflot

While BAB was begrudgingly offered the same deal as his brethren, he had 
perhaps lived too long as king-maker, and power proved addictive. The 
Oligarch of Oligarchs decided that he could stand down Putin, making him 
bend as Yeltsin had bent before him. BAB initiated a furious rear-guard 
action to counter Putin's political neutering of the governors (Berezovs 
ky's last remaining power base is regional), the State's reassertion of its 
control of ORT, etc. Suffering repeated defeats on the Russian battlefield, 
BAB substantially worsened matters by bad-rapping the President to any 
western media still willing to listen.

There is something almost moving in Berezovsky's desperate attempts to put 
himself across as the last defender of democracy (it was, inter alia, BAB 
who urged Yeltsin to cancel the 1996 elections) and in his attempts to 
establish an opposition party aimed at defending the interests of the 
governors. The governors,
of course, have problems enough without having Berezovsky as an ally, and 
his political future seems a bit compromised as he is arguably the single 
most hated man in all of Russia. The irony of it all is that until recently 
there was a regional governors party: it was Luzkhov's Fatherland - and BAB 
helped to strangle it in its infancy. Why a man not previously thought of 
as particularly idealistic should set out on a quixotic campaign against 
Putin is a matter of conjecture. We have had the pleasure of observing BAB 
at close hand, and were struck by his tactical intelligence, his almost 
pathological hyperactivity, and his overwhelming desire to control 
everything and everyone around him. From there to assuming a touch of 
madness, a form of megalomania?is a step we will not take.

In any event, Berezovsky is being charged with stealing virtually the 
entire cash proceeds of Aeroflot foreign ticket sales via two Swiss 
companies, Forus and Andava, allegedly established with the assistance of 
Lausanne-based Andre and Cie. The accusations, initially brought by Swiss 
prosecutors, were enthusiastically taken up under the Primakov regimen - 
only to be suspended once The Family managed to get Primakov fired. BAB, of 
course, knew that he had this one hanging over him - his bravado, while 
impressive, was eminently foolish. After steadfastly denying that he ever 
stole anything, according to BAB has suddenly switched stories, 
claiming that he misappropriated Aeroflot's money only to give it to 
Putin's election campaign (thus asking us to believe that he had the 
foresight to set up these companies years before he - or anyone else - had 
even heard of Vladimir Putin). We expect that an international arrest 
warrant will be issued, and while both he and Gusinsky are threatening to 
appeal all the way to the European Court of Justice (which is, of course, 
not legally competent here) Boris Abramovich may have forgotten that his 
reputation abroad is less than virginal. We would be surprised if the 
Putin government really wants him back in Russia, but they may yet get him, 

The Gusinsky story is obscure even by Russian Standards; it is, alas, a 
story with all bad guys - there are no good guys to be found. 

Gaz-ing the Oligarch

Like his new-found friend Berezovsky, Gusinsky has decided to fight it out 
with Putin, wrapping himself up in the flag and casting himself as a martyr 
for transparency and freedom of the press; his cynicism is here simply 
breathtaking - the Gusinsky press has, of course, been neither less nor 
more "fair and impartial" than the other oligarch media. A recent police 
raid disclosed that the Most Group had an internal espionage unit of huge 
scope, involved in spying on his perceived enemies, presumably for purposes 
of blackmail. Like most local media, NTV has been, and continues to be, 
utterly partisan in its coverage of Russian politics - it simply committed 
the unpardonable sin of backing the wrong horse (and then refusing to 
change mounts?).

The blow to Media Most can be seen as a blow to pluralism in the press, not 
to press "freedom." Gusinsky is erroneously seen as a businessman. In 
fact, the Media Most empire was built up on state handouts?it never 
actually had any economic rationale, and as soon as those handouts were 
withdrawn it was doomed to crash. Berezovsky himself, at a time when he was 
using his tame press to fight the Luzkhov camp, rather acidly remarked that 
for someone who owed everything to the state, Gusinsky could at least show 
a bit of loyalty. Faced with a deteriorating political position and in 
desperate economic straits, Gusinsky has taken his fight abroad. While he 
initially encountered a receptive audience in Washington, his constant 
lying and deception of his closest allies has gradually eroded his support, 
and his record of recent years does not encourage trust.

In brief, Gusinsky's media empire (along with the rest of his empire, 
including bankrupt Most Bank) is thoroughly bust, never having recovered 
from the 1998 crash. They were kept afloat by loans and loan guarantees 
from Sberbank and Gazprom (what, exactly, a gas company is doing owning 
media outlets we will leave to you to guess). As Gusinsky's NTV was a 
strong supporter of Yuri Luzkhov's party and a vehement opponent of Putin, 
the government must be delighted that Gusinsky has given them such a 
convenient means of taking his company away from him.

In July of this year, shortly after his arrival in Russia for questioning 
in a fraud case, Gusinsky found himself briefly imprisoned. Who, exactly, 
was behind his arrest, generating massively negative publicity just as 
Putin was flying to Europe for high-level meetings, has never been 
adequately explained. Nevertheless, after 3 days a deal was cut whereby the 
oligarch was allowed out of jail, with an agreement that charges would be 
dropped in return for his signing an agreement transferring control over 
his media empire to Gazprom. This agreement was notoriously co-signed by 
Press Minister Mikhail Lesin, leading to a minor scandal and earning Lesin 
a severe rebuke from Prime Minister Kasyanov, who requested that, as a 
government minister, Lesin stay out of disputes between private companies. 
Gusinsky promptly left the country and quickly reneged on the agreement, 
saying that it had been extracted by coercion. A long period of 
negotiations ensued. Campaigning in the foreign press, Gusinsky rather 
improbably claimed that he had found a mysterious foreign investor who 
planned to bring a massive infusion of funds (why any investor in his right 
mind would buy a bankrupt Russian media company in the middle of a huge 
fight with the Kremlin was not explained).

The "investor" never emerged and, last week, Gazprom Media chief Alfred 
Koch signed an agreement with Gusinsky, calling for Gazprom to receive 
25%+1 of Media Most and 16% of NTV, along with a 19% stake in NTV to be 
transferred to Deutsche Bank for resale to a "foreign strategic or 
portfolio investor", in payment of the $211 mn Gazprom-guaranteed CSFB 
credit which came due last March. Furthermore, by the terms of this 
agreement, when the second CSFB loan came due in July 2001, a further 25%+1 
of Media Most and 19% of NTV was to go to Gazprom.

Whether the deal was a victory for Most or for Gazprom was a matter 
fiercely debated in local circles until Koch suddenly rendered the question 
moot by "withdrawing" his signature of the document. Why he did so is 
currently the matter of some discussion. Most Media now claims that Lesin 
is responsible. Lesin, who is, at the kindest, referred to as primarily a 
"businessman", is closely linked to Video International, a St. Petersburg 
advertising group which previously had exclusivity for Berezovsky's ORT. 
Our guess is that Koch negotiated what he perceived to be a good deal for 
Gazprom, without taking into account the feelings of the Prosecutor General 
and/or the Presidential administration. The Prosecutor General has gone as 
far as to threaten Koch himself with prosecution (presumably for alienating 
Gazprom assets) and he has recently been making himself scarce, turning the 
fight over to Gazprom board Chairman Dmitri Medvedev. Thus it stands? we do 
not expect Gusinsky to retain control of the company, and we suspect that 
the charges that he has illegally transferred assets abroad to escape 
creditors are well-founded. On the other hand, we would be surprised if the 
Kremlin really wished to see him in a Russian prison--it would be rather 
unfortunate from the PR standpoint. If an Interpol warrant is put out for 
Gusinsky, he could probably find refuge in Israel.

Putin's election clearly marked a turning point. When we said so 
immediately after the election we were reviled with scornful invective from 
the "Russia Never Changes" faction, pointing out that since Berezovsky had 
greatly contributed to the making of Putin (which indeed he did), he 
therefore owned him (which he very clearly does not). "Of course," we were 
told, "any idiot could see that Putin was Berezovsky's creature?" If that 
is, indeed, the case, we would hate to see what Putin does to people he 
doesn't favor!

If the Berezovsky story draws no tears and there is a widespread feeling 
that Yeltsin's erstwhile gray eminence is finally paying the piper, the 
Gusinsky story reflects well on no one. Certainly, by its ham-handed 
treatment of what should have been a purely commercial dispute, the Kremlin 
has generated a great deal of sympathy for someone who frankly does not 
deserve it. All of this comes at a cost, especially in terms of foreign 
perceptions of the Putin administration. We re-iterate our fundamental 
view: while we expect the administration to continue to step up its 
pressure on the broadcast media, to date we have seen no sign of the much 
feared return to press censorship. From the investor's standpoint, the 
decrease in the political power of the oligarchs is an unmitigated 
blessing. A year ago, we were told that an arrest of Berezovsky would send 
the market soaring by at least 20% - having him on the run should thus be 
worth at least a modest 10%? though we won't bet on it.

Eric Kraus, Chief Strategist,
NIKoil Capital Markets
The views and opinions expressed herein are those of the author and do not 
necessarily represent those of any institution. 


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