November 28, 2000   

This Date's Issues:   4656 • 4657

Johnson's Russia List
#4657
28 November 2000
davidjohnson@erols.com

[Note from David Johnson:
1. Reuters: Putin sings praises of old-new Russian anthem.
2. Toronto Sun: Matthew Fisher, Why Russia loves Putin.
3. Globe and Mail (Canada): Matthew Fisher, Santa go home, some Russians say. Nationalists decry the proliferation of Christmas symbols linked to the West.
4. BBC Monitoring: Internet expert views Russian new media market.
5. Christian Science Monitor: Scott Peterson, Central Asia's Islamist crucible. As Muslims began observing Ramadan this week, an insurgency simmered in an impoverished region. 
6. The Russia Journal editorial: No deal not such a bad deal. (re IMF)
7. Moscow Times: Andrei Zolotov, Criticism of President Not Ombudsman's Job. (Mironov) 
8. Reuters: Sweden unsure on Wallenberg despite probe.
9. Eric Kraus: Forget Paris - Renegotiating Soviet Debt.
10. Harvard Caspian Studies Program: Carol Saivetz, Putin's Caspian Policy.]

******

#1
Putin sings praises of old-new Russian anthem
By Andrei Shukshin

MOSCOW, Nov 28 (Reuters) - President Vladimir Putin wants Russians to
resume humming Stalin's old anthem in the new millennium, but with words
about a flying Russian eagle to replace the lines about the "unbreakable"
Soviet Union. 

A Kremlin source told Reuters on Tuesday that Putin wanted parliament to
approve a law re-establishing the Soviet tune as the national song, with
new words by the same poet who composed the original nearly 60 years ago. 

Russia has been without an official anthem since 1991, when the unbreakable
union broke up. An arcane tune without lyrics has been used as a stand-in,
a situation that prompted many sarcastic comments. 

Players in the national soccer team have said they feel foolish having to
stand with their mouths shut while the opposing side always had a
morale-boosting song to sing. 

Tired of years of dithering, Putin told a new advisory State Council
grouping Russia's regional leaders to decide whether to resurrect the
catchy Soviet tune, write words for the current one or compose a new anthem
altogether. 

But Putin's proposal to move quickly on the anthem has sparked heated debate. 

While most older people favour the familiar Soviet tune, newspapers said
Russia's Orthodox Patriarch Alexiy II was pressing the Kremlin not to
reinstate music which many associated with repression and atheism. 

The source said the Kremlin would send a bill to parliament next week
proposing to keep intact the music composed by Alexander Alexandrov in 1943
and personally approved by Soviet dictator Josef Stalin. 

It will be accompanied by new verses by 87-year-old Sergei Mikhalkov, a
beloved children's poet who wrote the original words in 1943. 

Parliamentarians will also have to vote to approve Russia's other state
symbols -- the double-headed eagle and the red, white and blue flag. 

Communists in parliament have long opposed replacing the old Soviet hammer
and sickle and red flag. But the new symbols are given prominent mention in
the words for the revived anthem, which may help make them relent. 

The source said Putin wanted the country to enter the millennium, which
Russians calculate starts in 2001, with a full array of state symbols. 

Officially, eight tunes, including one by Russia's most famous pop diva,
are being considered as the new anthem. 

But the Kremlin source quoted the opening lines of the verses Mikhalkov had
written for the old tune, making it clear Putin had made up his mind. 

"Its mighty wings spread above us/ The Russian eagle is hovering high/ The
Fatherland's tricolour symbol/ Is leading Russia's peoples to victory." 

(Additional reporting by Ivan Rodin) 

******

#2
Toronto Sun
November 27, 2000 
Why Russia loves Putin
By MATTHEW FISHER -- Sun Columnist at Large

MOSCOW -- It's been almost one year since Boris Yeltsin surprised Russians
by anointing Vladimir Putin as his successor. 

Job reviews for the former secret policeman are mixed. Many outsiders and
much of Moscow's intellectual elite remain skeptical about Putin's
commitment to democracy and free speech and his willingness to really go
after the robber barons and the so-called New Russians who stole billions
from the state during the 1990s. 

But most Russians think Putin is doing just fine, judging by recent opinion
polls. 

Putin got just more than half of the votes in last March's presidential
election. If he were to run again today, it's a certainty he would win at
least seven of every 10 ballots cast. 

Russians love Putin because they crave order. Fed up with Yeltsin's decade
of buffoonery and misrule, they're enthralled by his successor's tough talk
on domestic affairs, his highly disciplined work habits and quiet private
life - and his vow to make Russia a respected international power again. 

The Moscow crowd, which tends to be liberal and outward looking, sees Putin
as a grey figure from their Soviet past. They dream of closer contacts with
the West and a more western lifestyle. But tens of millions living dire
lives in Siberia or southern Russia are of a much different opinion. 

Those in the boondocks saw none of the big foreign money which Moscow
gorged on during the 1990s. This just confirmed the outsiders historic
hatred for those lucky enough to have papers to live in the capital and
made them deeply distrustful of Muscovites' slick, new foreign friends. 

The top concerns in the vast hinterlands to the south and east of Moscow
are cowboy capitalism at the local level and irregular supplies of
electricity and heating oil. In these places expectations aren't very high.
Even a minuscule improvement in the standard of living would be welcomed. 

Those in the hinterlands have been happy to see Putin re-assert the
Kremlin's authority by breaking some of the country's most corrupt regional
leaders, even if this has meant installing cops and generals in their
places. They resolutely believe a return to central control, if not exactly
to communism, is the only way to solve Russia's problems. 

Putin has been awfully lucky, too. Yeltsin presided over Russia during
years of drastic economic decline. His successor's unexpected arrival in
the Kremlin conveniently coincided with a big jump in global oil prices.
This has brought Russia back from the brink of bankruptcy and allowed Putin
to play the benevolent dictator, paying wages and pensions on time for the
first time in years. 

To be fair, Putin faces an almost impossible job to turn Russia's fortunes
around. He inherited a dispirited country which has had great difficulty
adjusting to its greatly reduced status as a nuclear power and which is
saddled with such Third World economic problems as a public health system
that barely functions. 

So ... where to start? 

A measure of the difficulties facing Putin and Russia is that it's just
about impossible to figure out how many men are still in the armed forces.
Counting interior ministry troops, border guards and paramilitary police
units, a good guess is somewhere between two and three million. Yet the war
in Chechnya still remains unwinnable and the sinking of the nuclear
submarine Kursk has been an even more painful national humiliation than the
Soviet retreat from Eastern Europe after the Berlin Wall came down. 

In a speech last Monday, Putin admitted 2,600 Russian boys had died in
Chechnya since last year and came close to accusing the entire officer
class of being utterly incompetent. He followed this attack by repeating
his intention to revive the armed forces by cutting the number of men in
uniform by 600,000. 

When campaigning for the presidency, Putin claimed the war in the Caucasus
had finally been won, and Russians cheered him for it. So Putin's fierce
words about his officers and his order to slash more than a quarter of the
military's manpower were necessary not only because the armed forces are
bloated and weak, but because the never-ending war in Chechnya is one of
the few issues which could eventually undermine his immense popularity with
all those Russians who admire him because they admire a strongman. 

******

#3
Globe and Mail (Canada)
Santa go home, some Russians say 
Nationalists decry the proliferation of Christmas symbols linked to the West
GEOFFREY YORK

MOSCOW -- Santa Claus is coming to town. And Russia's nationalists are as
unhappy as Scrooge.

For the first time, Moscow schools will close on Dec. 25 to allow families
to celebrate Western Christmas, two weeks before the traditional Russian
Orthodox Christmas.

Nationalist politicians are furious. They see it as another instance of the
stealthy invasion of Western pop culture, fuelled by capitalism and the
evil influence of American television and movies.

To heighten the insult, Santa Claus, that chubby symbol of Western
Christmas, is infiltrating Moscow's shopping malls, shoving aside the
skinnier figure of Ded Moroz (Grandfather Frost), the white-bearded,
heavy-drinking Russian winter icon.

Santa Claus was allowed equal time with Ded Moroz at the kickoff of the
Christmas shopping season in Moscow last week, when an official Santa flew
in from Lapland, Finland, for an unprecedented summit meeting with Ded
Moroz, organized by Moscow's city hall.

Western holidays have been steadily encroaching on the Russian calendar
over the past few years, especially in Moscow, the country's most
Westernized city.

Moscow's hippest nightclubs and shopping malls are beginning to celebrate
such events as Halloween and Valentine's Day, which were virtually unknown
during the Soviet era.

Children dressed as witches and vampires were spotted going out for
trick-or-treat in a few of Moscow's trendier neighbourhoods last month, and
dance clubs held a series of Halloween parties. Last February, nightclubs
threw parties for Valentine's Day, which had always been ignored in favour
of the official Soviet holiday of International Women's Day.

The latest penchant for Western Christmas is too much for many Russian
patriots to tolerate. "All this Westernization is just a trick to make us
forget our own religion and traditions," fumes Pavel Yemelin, spokesman for
the Agrarian Party.

"By hook or by crook, they are trying to turn us into Catholics. They
failed to do it over the past thousand years, but they've been succeeding
in the past 10 years. We can't accept this; we want the Russian people to
preserve their own holidays and their own integrity."

Vasily Shandybin, a Communist member of parliament, is enraged by the
Moscow school decision. "Why should we copy Western holidays?" he demands.

"We are Russians and we have our own culture. What can we get from
Americans? The Soviet Union had the best education system in the world, but
now they are trying to destroy it. They want our children to forget the
meaning of patriotism and love for the motherland."

In the Soviet era, Orthodox Christmas was banned or suppressed, and the
gift-giving tradition was transferred to the secular holiday of New Year's
Eve and New Year's Day.

After the collapse of the Soviet Union and of official atheism, Orthodox
Christmas was declared a national holiday, but it is primarily a religious
event, marked by solemn all-night church services. And because the Russian
church follows the old Julian calendar, Christmas is always celebrated on
Jan. 7.

Western Christmas, on Dec. 25, is usually a normal working day. But with
the rise of capitalism, Russian retailers are borrowing Santa Claus as a
useful tool for expanding the shopping season and spreading the glitzy
message of consumerism.

Huge plastic models of Santa Claus and his reindeer-drawn sleigh are
increasingly visible in malls and shops. There are Christmas specials,
holiday sales and Western-style bells and ribbons. American movies with
Christmas themes are increasingly broadcast on television on Dec. 25.

School holidays usually begin around Dec. 27 or 28, but this year the
Moscow Education Committee recommended they should start on Dec. 25, and
most schools say they will comply.

"Russia is trying to integrate into the world community, and we are
celebrating more and more of the Western holidays, especially Christmas,"
said Alexander Gavrilov, spokesman for the education committee.

Because of rising foreign investment in Moscow, many parents work for
Western companies, which close on Dec. 25. "A school holiday will let
parents spend more time with their children," Mr. Gavrilov added.

As for parents themselves, they have mixed feelings.

Konstantin Neshnikov, a 39-year-old father of two, scoffs at the invasion
of Western holidays: "Who needs Western Christmas? Maybe it makes sense for
the rich people; it gives them another opportunity to go to a nightclub or
a restaurant, to buy new clothes or go on a foreign trip. But for ordinary
people it doesn't mean anything."

Younger people, however, are enthusiastic.

"I like Western holidays, and I think we should have the same as in Europe
and America," says Inna Kolesnikova, an 18-year-old student. "The more
holidays, the better."

******

#4
BBC Monitoring
Russia: Internet expert views Russian new media market 
Source: 'Izvestiya', Moscow, in Russian 23 Nov 00

The number of Russian users preferring to access news online is rocketing. 
The Internet media are preparing to be serious competition for offline 
publications. Your `Izvestiya' correspondent Pavel Bardin asked Marina 
Litvinovich, director of Internet projects of the Effective Policy Foundation 
[FEP], the leading company in terms of the number of informational Internet 
resources it has set up - www.russ.ru, www.gazeta.ru, www.lenta.ru, 
www.smi.ru, www.vesti.ru, www.strana.ru, and many others - about the 
development prospects for the Russian Internet's information resources. 

[Bardin] What is happening on the Russia Internet media market at the moment? 
What influence do the offline media exert on this market? 

[Litvinovich] The information resource market is saturated. Nevertheless, 
many offline media want to implement their own Internet projects. I think 
they are too late. `Kommersant', for instance, is implementing a major 
Internet project at the moment but it is unlikely to amount to anything, 
however much money they put into it. 

That is the difference between our market and the West's. Any attempts by 
Russian offline media to make an online version of themselves in the hope of 
becoming a major, visited, interesting, significant online resource are 
pointless. People are not interested in reading a mirror of an offline 
publication on the Web. 

Nevertheless, attempts to set up an Internet media instrument not as an [old] 
media instrument but as a fully-fledged Internet project can perfectly well 
become successful. I think a great deal depends on the positioning of the 
project, on what message it tries to bring the reader. 

[Bardin] What if you have two different editorial boards for the online and 
offline publications like they do in the West? 

[Litvinovich] You can devise a project that is partially based on the 
capacities of an offline media instrument but it must have its own separate 
life. Simply transferring all the articles from a paper or broadcast form 
into an electronic form is not effective. 

The Internet is a separate market, one that requires a completely separate 
strategy and a separate positioning. You have to have a concept of what you 
are bringing to this market. A publication's brand that has been formed in 
the offline world has a completely different value online and lives according 
to different rules. 

It is funny: ORT [Russian Public Television] is a national channel but the 
site is not visited much despite the fact that it is not done badly. NTV.ru 
is a much more interesting and successful resource because it is not 
presented as an online version of the television channel of the same name 
[NTV - Independent Television]. But it is still caught in the pincers of its 
offline name. 

Many people like to compare NTV.ru with strana.ru, although I do not think 
this is a correct comparison. The grounds for the comparison are 
understandable: We started up almost at the same time; the teams producing 
strana.ru and NTV.ru are approximately equal in terms of the strength of 
their human resources; and the investment of material resources were roughly 
equal. But NTV.ru has much more advertising possibilities, of course; they 
play a clip advertising NTV.ru after each edition of the NTV news. 

At the same time, we are running neck-and-neck with them according to all the 
popularity ratings, whether you take Rambler or SpayLog. This indicates that 
it is difficult for people to perceive NTV.ru as something other than an 
extension of the television channel. Accordingly, viewers think they will see 
the same news on the Internet as on the television. I think they should go in 
for a bit of a ruse and promote NTV.ru under a different brand... 

******

#5
Christian Science Monitor
November 28, 2000
Central Asia's Islamist crucible
As Muslims began observing Ramadan this week, an insurgency simmered in an 
impoverished region. 
By Scott Peterson, Staff writer of The Christian Science Monitor 

A Muslim pilgrim site for centuries, the jagged, snow-dusted mountain known 
as Solomon's Throne rises like an inspiration from the fertile Fergana 
Valley. 

This area of Kyrgyzstan - once an important, mountain-ringed crossroads of 
the ancient Silk Road - has been a past source of spiritual inspiration. But 
as Muslims begin to celebrate the holy month of Ramadan, it is gripped by 
militant "pilgrims" of another kind, whose operations are changing 
assumptions about Central Asian security. 

Guerrillas calling themselves the Islamic Movement of Uzbekistan (IMU) - 
whose stated aim is to overthrow the fiercely secular and authoritarian 
regime of Uzbek President Islam Karimov, and install an Islamic state - 
crossed into Kyrgyzstan and Uzbekistan from Tajikistan in August and fought 
for two months. 

An initial incursion last year set off alarm bells, since the volatile 
Fergana is where the three ex-Soviet Central Asian states intersect. Russian 
President Vladimir Putin this spring warned of an "arc of instability" 
catching fire across the region, and promised military cooperation and 
political backing. 

On a visit earlier this year, US Secretary of State Madeleine Albright 
promised $10 million in aid to the three Central Asian states. US Army 
special forces units are bolstering the Kyrgyz military with nonlethal aid 
and training. 

For many from Moscow to Washington, the insurgency may appear to confirm 
theories that militant Islam is on the march in Central Asia, fueled by 
victories of the radical Taliban in Afghanistan. But analysts are divided 
over the significance of any Islamic "threat" to the region - and even how 
"Islamic" the guerrillas may be. Also unclear is the scale of home-grown 
support for the rebels. 

"The further you get from the problem, the bigger it becomes," says Alexei 
Sukhov, Osh correspondent for the opposition Res Publica newspaper. "For 
people [here], it is no big deal. But further away, they get more scared." 

Long considered a religious hotbed, the Fergana Valley is a strategic 
crucible of different ethnicities, Islamic styles, and a patchwork of borders 
drawn up by Joseph Stalin in 1924. Just as confused are the motives of the 
5,000 or so men who, operating from Tajikistan with the apparent support of 
Afghanistan's Taliban, carry out the insurgency. Causing instability is high 
on the list for the IMU, which is led by Juma Namangani, an ethnic Uzbek 
believed to be a former Soviet airborne soldier who served in Afghanistan in 
the 1980s. Putting the IMU's stamp on the lucrative drug trafficking that 
permeates these borders may be another priority. 

"Nobody gave them the right to call themselves 'Islamic.' This is not 
religious resistance, it is political," says Sadiq Kamal al-Deen, the former 
mufti of Kyrgyzstan and head of the International Center of Islamic 
Cooperation in Osh. "Muslims accuse [the rebels] of spilling blood, and we 
object that they use the word 'Islam' for that," he adds. "The [IMU] just 
wants to show the world that they exist. These are the first signs, just 
knocking at the door. But we are praying for a solution so there is no real 
war here." 

"The IMU unites people fighting for personal goals, from Islamists to 
criminals," adds Mr. Sukhov. "If you are religious, you are fighting for 
religion; others fight for money. Most cash support comes from Arab 
countries, and they give it only if you say you fight for an Islamic state. 
But within this goal you can achieve a lot." 

Contrasting leadership styles complicate the equation. Mr. Karimov is a 
former Communist party boss, and in 1998 told Uzbekistan's parliament that 
extremists "must be shot in the head" and that "if necessary, I'll shoot them 
myself." While Kyrgyz President Askar Akayev has taken a more open view, his 
security forces are getting tougher toward devout Muslims - especially in the 
Fergana Valley. "Uzbekistan has taken a pretty brutal line - they've thrown a 
lot of people in jail. One can see that theme beginning to emerge in 
Kyrgyzstan," says Terence Taylor, the assistant director of the International 
Institute of Strategic Studies in London. "A year ago, people were saying [of 
an Islamic state], 'No, impossible.' While I don't foresee it in the near 
term, one just can't rule it out now." 

That concern has rattled Russia, which keeps 10,000 troops in Tajikistan and 
has warned Afghanistan about exporting unrest - and militant ideology. "They 
certainly want to push back the instability on their southern borders, which 
[Russia] grossly oversimplifies as Islamic extremism," Mr. Taylor says. 

The Fergana Valley is where "the three main interests overlap: ideology, drug 
trafficking and political interests," says Bolot Djanuzakov, the head of the 
Kyrgyz National Security Council. "We don't accept the title IMU - there is 
no such organization," he adds. "The Islamic state is only a veil for 
terrorism." 

Analysts say that Islamic militants across Central Asia may be encouraged 
both by recent success of the Taliban - which is believed to have close ties 
to the IMU, and helped train them - and setbacks to separatist Muslim forces 
by Russia in Chechnya. But others argue that there are reasons enough, such 
as grinding poverty, to fight closer to home. Kyrgyzstan ranks among the 
poorest nations in the world, with people earning $1 a day on average. 

"There is undoubtedly rising support among the general public for radical 
measures to change the [Uzbek] regime," says John Schoeberlein, director of 
the Forum for Central Asian Studies at Harvard University in Cambridge, 
Mass., and head of the Central Asia project for the Brussels-based 
International Crisis Group. "The problem should not be described as a 
religious one, per se. It's not that there is an impulse toward radical Islam 
in the region that is the driving force," he says. "[But] people see so many 
problems unaddressed, and have no alternative. 

"In the long run, the right policy for these governments is to take a more 
open approach," he adds. "By suppressing it, they are simply going to create 
a more determined opposition." 

After 70 years of official atheism, the collapse of the Soviet Union in 1991 
gave way to resurgent faith in much of Central Asia. But "post-Soviet 
governments ... used [Islam] as a tool for building a national identity," 
says Alisher Khamidov, director of the Osh Media Resource Center. "They had 
to legitimize their governments, and were careless. They couldn't predict 
that political Islam would have consequences; that Islam wanted more." 

In Tajikistan, that miscalculation sparked a civil war that killed 50,000, 
and finally ended in 1997 with a power-sharing deal that brought Islamic 
rebels into the government. There was another brief flare-up in August, but 
for Central Asian militants, that success in 1997 has been a source of hope 
ever since. 

"Uzbekistan is trying to seal its borders and avoid the Tajik scenario," Mr. 
Khamidov says. "Their media is demonizing Muslims, calling them terrorists. 
But the government is playing with a huge fire. People are being radicalized, 
and pressure is building up. It will explode one day." 

******

#6
The Russia Journal
November 25-December 1, 2000
Editorial
No deal not such a bad deal

When asked why reform had worked so successfully in Poland and failed so
badly in Russia, a former Polish finance minister once said: "We used to
politely listen to the International Monetary Fund (IMF) and then get on
with reforming the economy our way."

The implication was that Russia’s mistake was in attempting to implement
the IMF’s Chicago textbook wish list in full, producing an economic
catastrophe. That, of course, is not true. 

Russia also nodded sagely at the IMF and then did its own thing – which
was, unlike the Poles, to do precisely nothing at all. Poland was sincere
in its efforts to turn its economy around and is now enjoying steady
economic growth and fast-track status to EU membership.

In 1990s Russia, the IMF’s main role was to bankroll one of the most
corrupt and incompetent regimes in Europe – allowing Soviet apparatchiks to
steal with impunity, while pensions remained unpaid for months on end. The
tragedy of IMF policy, apart from its moral bankruptcy, was that in the end
it left ordinary Russians with a tab of $20 billion.

Fast-forward to last week, when the IMF left Russia without a deal. 

On one hand, this is of no great consequence: High oil prices mean that
Russia does not need loans to plug holes in its budget, so there was little
lost. But more importantly, and more positively, this round of negotiations
saw a rise in the intellectual level of the negotiations between the fund
and Russia.

Russia, it seems, is beginning to follow the Polish model.

The government did not sign a program that it would not have been able to
fully implement – showing some honesty; and it is disagreeing with IMF
macroeconomic forecasts – opting for more conservative estimates in the
belief that the international commodity market could turn sour any time.
This is all sensible stuff. The IMF, for its part, also did itself no harm.
It could have caved in to the Russian government and signed an agreement,
just for show. But it stuck to its guns.

In truth, the only reason Russia needs an IMF agreement is to negotiate
restructuring of its Paris Club Soviet-era debt – without such an agreement
Russia will either have to technically default or pay the full $2.7 billion.

Although Soviet debt is a pernicious burden (it should have been forgiven)
– we would argue it is better for Russia to pay while it has the money,
than to plunge into crisis in the future under the weight of foreign debt.

That said, one area where the government and IMF do need to find agreement
is in prioritizing reform. It seems that now, while there is some momentum,
would be a good time to tackle the banking sector – and the vested
interests there. Men like Alexander Smolensky should not still be stripping
assets from banks and forming new institutions. 

Still, it is positive to see that the farcical agreements of the 1990s
between the IMF and Russia are coming to an end. For the credibility of
both parties, no agreement is better than a lie.

******

#7
Moscow Times
November 28, 2000 
Criticism of President Not Ombudsman's Job 
By Andrei Zolotov
Staff Writer

In what some human rights activists described as an artificial narrowing of 
his powers, state human rights ombudsman Oleg Mironov said over the weekend 
that complaints against the president were not welcome in his office. 

"According to the Constitution, [the president] himself is the guarantor of 
citizens' liberties," Mironov was quoted by Interfax as saying Sunday. "We do 
not allow any critical remarks regarding the president." 

According to the 1993 law creating the position f a five-year post appointed 
by the State Duma f the ombudsman is not allowed to receive complaints 
regarding Russia's parliament. But although executive officials do fall 
within the post's jurisdiction, there is no specific mention in the law of 
how the president fits in. 

In comments reported by Interfax, Mironov described his office as an "ally" 
and "supporter" of the president, and added that President Vladimir Putin 
understands the universal nature of human rights. 

Human rights advocates were critical of Mironov's statement. 

"He should not receive complaints about the legislative branch, but as far as 
the executive is concerned f he must," Boris Pustintsev, chairman of the 
Citizens' Watch human rights group, said Monday in a telephone interview from 
St. Petersburg. 

Since Mironov's appointment in 1998 f following the five-year tenure of 
longtime rights activist and former dissident Sergei Kovalyov f the office's 
powers have narrowed rather than expanded, Pustintsev said. 

"[Mironov] knows too well what he is not supposed to do," he said. 

The ombudsman's powers are fairly limited. He has the right to file lawsuits 
about human rights violations by government agencies, request that 
authorities open a criminal case or ask a court to review a previous 
decision. He does not have the right to introduce legislation. 

Mironov, a member of the Communist Party at the time of his appointment, has 
been significantly softer than his predecessor, although earlier this year he 
did speak out sharply against the federal government's policy in Chechnya. 

State Duma Deputy Yuly Rybakov said that from a formal point of view, it is 
debatable whether wrongdoings of the president fall under the ombudsman's 
jurisdiction. "But from a moral viewpoint, [Mironov's] statement goes beyond 
any limit of what is proper," Rybakov said. 

Segodnya newspaper on Monday speculated that Mironov was attempting to 
reaffirm his place in the government's evolving power structure. 

In the same comments reported by Interfax, Mironov also called on the 
presidential administration to expedite the search for a new working space 
for his office. The ombudsman shares a building on Myasnitskaya Ulitsa with 
40 other organizations. 

******

#8
INTERVIEW-Sweden unsure on Wallenberg despite probe
By Patrick Lannin

MOSCOW, Nov 28 (Reuters) - A Swedish official working with Russia on
unravelling the fate of Raoul Wallenberg said his country was no closer
knowing how the diplomat reputed to have saved thousands of Jews during
World War Two died. 

Jan Lundvik, a member of a joint Swedish-Russian committee working to
uncover Wallenberg's fate, said the Swedish side of the enquiry had
garnered fresh evidence on the chain of events which led to the diplomat's
imprisonment. 

But the central issue of how and when he died was unsolved. 

"We have a number of conflicting versions but we have no way of telling
which one reflects the truth," Lundvik told Reuters by telephone from
Stockholm late on Monday. 

Wallenberg, who helped thousands of Jews escape the Holocaust, disappeared
in 1945 in Budapest after being arrested by Soviet troops. 

The head of a Russian presidential committee on rehabilitating victims of
Soviet-era repressions said on Monday he was sure Wallenberg had been
executed in the notorious Lubyanka headquarters of the Soviet secret police
in 1947. 

Lundvik noted that the Soviets had first said in 1957, citing a report by a
doctor at the Lyubyanka, that Wallenberg had been found dead in his cell
after a heart attack. 

"Then there are the versions that it was not a natural death but that he
was put to death. There is the one that he was shot, there is the one that
he was poisoned and there is still another version that he died after
having been badly treated," he said. 

"But we still have not had any definite evidence of just that version being
more truthful than the other ones," he added. 

He said no death certificate had been issued for Wallenberg, even if
certificates issued for people who had been executed did not give the true
cause of death. 

"That is one of the unexplained aspects of this case. Why was there never
any official document certifying his death?" 

He also cited testimony that Wallenberg had been sighted in the Gulag
labour camps built by Soviet dictator Josef Stalin. 

"We are not in a position either to say with any certainty that he did in
fact die nor are we in a position to prove that he was alive later,"
Lundvik said. 

REPORTS DUE IN JANUARY 

The diplomat said Russia and Sweden would each present their findings in
January next year in separate reports. If the case had not been solved to
Sweden's satisfaction by that time, officials would go on looking. 

"We made it clear a long ago that if we cannot shed a definite light on
what happened then the investigation will continue, we cannot close the
case on our side," he said. 

"We have received assurances from them (Russia) that they will continue to
cooperate," Lundvik added. 

Lundvik also dismissed the testimony of a Ukrainian who said he was a World
War Two partisan and that he had in fact been the one to arrest Wallenberg
first. He said he had detained the Swede in Slovakia and not in Hungary. 

"There was not one right figure in his account," Lundvik said. 

"We have a fairly good picture of what happened through a number of sources
and there was nothing in this Ukrainian guy's report that can be confirmed
by any other source." 

******

#9
From: Eric Kraus [ekraus@nikoil.ru]
Sent: Thursday, November 23, 2000 
Subject: Forget Paris - Renegotiating Soviet Debt

Forget Paris! (or, just say "no")
Eric Kraus,
Chief Strategist, Nikoil Capital Markets, Moscow
November 21, 2000

Extracted from Quarterly Strategy Report, "The Bear Walks...but now, Can 
She Dance?" The full text is available upon request to: ekraus@nikoil.ru

Forget Paris - Renegotiating Soviet Debt
There is one major threat to our rosy macroeconomic scenario - not a 
potential fall in oil prices, which, provided they not break below a very 
improbable $15/bbl, would not imperil the execution of the budget, but 
rather, the possibility that were the Paris Club to refuse some form of 
debt forgiveness, the Russian government could imperil the entire economic 
edifice in an heroic but futile attempt to comply with their demands.

The London Club debt (i.e. Soviet-era debt held by private creditors) was 
successfully renegotiated at the beginning of 2000, leading to issuance of 
non-collateralized step-up instruments, the RF 2010 and 2030 bonds. This 
deal included approximately 38% debt relief, i.e. near the mean for Brady 
deals, and similar to that granted Poland and Bulgaria. While Russia is now 
quite logically requesting a similar treatment for Paris Club debt, the 
main Paris Club creditor, Germany, has repeatedly proclaimed that it will 
settle for nothing less than full payment according to the original 
schedule.
We think this position unjustifiable, short-sighted, and frankly dangerous.

Paris Club debt is debt extended on non-commercial terms, frequently as a 
covert subsidy for local exporters, or as state-to-state lending extended 
for political, military or humanitarian considerations. This debt was 
contracted by the Soviet Union, a now-defunct state. Though modern Russia 
has only half the population and a very different economic geography, she 
did accept legal responsibility for all Soviet debt in return for Soviet 
assets during the brief honeymoon following the collapse of Communism. The 
responsibility for these liabilities (the assets turned out to be largely 
worthless) was assumed at a time when it was widely believed that by 
following a few orthodox fixes, Russia would quickly resume her place 
amongst the industrialized nations - alas, it was not to be.

The issue of morality (gentlemen repay their creditors) is here quite 
simply irrelevant. More than 50 sovereign debt restructurings have been 
carried out since the Mexican Pre-Brady deal in 1981 which put an end to 
"La Decada Perdida", the lost decade for Latin America. Much like corporate 
bankruptcies, these workouts aim to salvage value for creditors, leaving 
the debtor with a challenging but sustainable debt load. In all recent debt 
work-outs, the Paris Club and IFIs have successfully demanded "burden 
sharing," i.e. that private creditors suffer a writedown similar to that 
granted by public entities. To put it mildly, it is surprising that the 
Paris Club now indignantly refuses to accept the same haircut as that 
already accepted by private creditors of the London Club.

We believe that this hardline position is explained primarily by domestic 
electoral pressures, i.e. it would be quite unpopular in several European 
countries to be seen to grant economic relief to Russia, a country which 
has recently suffered very pejorative coverage in the western press, in 
particular over Chechnya. International finance is not a popularity 
contest, and we do not see Russia accepting this sort of political 
interference.

Sovereign debt negotiations usually focus upon what is doable. Russia is 
already paying well over $10 bn/year, some 25% of her total budget, in 
foreign debt service and amortization. Even were it possible to pay more, 
this would starve the country of vital investment, as well as render the 
economic edifice susceptible to any macroeconomic shock, imperilling 
Russia's ability to set her own priorities and make policy as an 
independent state.

While it might seem self-serving to claim that Russia's rescheduling of 
Paris Club debt is actually in the best interests of the creditors, this 
may nevertheless be the case. An unsustainable debt burden is, by 
definition, destined to be defaulted upon, but in the meantime, an attempt 
to pump all available resources out of the country to service this load 
would lead to arrested development, grinding poverty and eventually, a 
strengthening of populist-extremist forces, whether of the left or the 
right. It seems obvious that the Western European nations have a strong 
interest in political stability in Russia - political stability in the 
absence of economic recovery would be illusory.

Finally, the argument that only by reaching a Paris Club deal can Russia 
re-access the credit markets is disingenuous. While a good Paris Club deal 
would indeed facilitate new issuance, a bad one would be far worse than no 
deal at all: no private borrower in his right mind would lend to a country 
seen as groaning under the weight of an unsustainable debt-burden. Indeed, 
in our experience the credit market is a very unsentimental place, and an 
outright repudiation of Paris Club debt would doubtlessly be met with a 
substantial compression of Russian sovereign spreads. Though such an 
extreme solution seems unlikely, we would not be surprised if Russia came 
away with a medium-term rescheduling (perhaps the deal could involve 
issuance of VRRs - value recovery rights indexed to the price of oil - 
similar to those attached to Mexican Brady Bonds) or, failing that, simply 
make a take-it or leave-it offer, unilaterally capping debt payments at a 
sustainable level. We assume that Kasyanov's survival instincts remain 
intact.

*******

#10
From: sdijfk@harvard.edu
Subject: Caspian Studies Program Policy Brief
Date: Mon, 27 Nov 2000 1

Dear Colleague,

We are pleased to announce that the Caspian Studies Program at Harvard
University has launched a new Policy Brief publication series. (Please find
the link below.) The Policy Briefs analyze crucial issues relating to
developments affecting the Caspian Region, and propose policy
recommendations where appropriate. The Briefs are geared toward the
policymaker in Washington, but may be useful for policymakers in the
Caspian region and in other countries that are actively engaged there. The
Caspian Studies Policy Briefs are also effective tools for teaching
contemporary issues and as background materials for theoretical test cases
in academic courses.

Enclosed is the first Policy Brief of the Caspian Studies series: "Putin's
Caspian Policy." This policy brief is very timely in light of Moscow's
heightened activity in the Caspian and its articulation of new and coherent
policies toward the region. In the brief, Dr. Carol Saivetz, a leading
analyst of Russian foreign policy, discusses Putin's Caspian policy, and
recommends U.S. responses to the new Russian policies.

We welcome your comments on this and future Policy Briefs in the series,
and hope to hear from you regarding the subjects you would like addressed
by our series. While the opinions and policy prescriptions in the Briefs
are solely those of the authors, we hope they will spur discussion and the
optimization of policy in and toward the Caspian Region.

Sincerely,
Brenda Shaffer
Research Director
Caspian Studies Program
Harvard University

http://ksgnotes1.harvard.edu/BCSIA/Library.nsf/pubs/SaivetzPutin

Putin's Caspian Policy
By Carol R. Saivetz (saivetz@pop.fas.harvard.edu) 
Carol Saivetz is an Associate at the Davis Center for Russian Studies at 
Harvard University, and Executive Director of the American Association for 
the Advancement of Slavic Studies (AAASS).

Since his election in March, Russia's new president, Vladimir Putin, has put 
the Caspian Sea region with its vast energy resources high on Russia's 
strategic agenda. On April 21, 2000 the Caspian was one of only two topics 
discussed by the Russian Security Council. At the same meeting Putin 
announced the creation of a special presidential representative for Caspian 
affairs. The new Russian foreign policy concept, published in early summer, 
specifically mentions the Caspian basin and, in July a joint company composed 
of LUKoil, Gazprom, and Yukos was created to develop Caspian Sea resources. 
This series of moves signals Putin's determination to reassert Russian 
influence in the "near abroad," and to bring coherence to Moscow's policy in 
the Caspian region. Three questions, therefore, need to be answered: 1. Why 
is Putin making the Caspian such a priority? 2. What exactly is Putin's 
policy toward the Caspian? 3. How should the US respond?

Why the Caspian?

With the collapse of the Soviet Union in 1991 Russia lost influence and 
proprietorship over much of the Caspian Sea basin. Even worse, in the view of 
many high ranking Russian officials, Azerbaijan, Kazakhstan, and Turkmenistan 
sought to build their new found independence by exploiting--with Western 
investment--the energy resources in what they viewed as their sectors of the 
Caspian. Russia openly objected, claiming that the Caspian was an inland 
lake--meaning that any projects had to be agreed by all the littoral states. 
This legal ploy was clearly based on geopolitical rather than legal 
considerations. 

But ownership of the resources is only half of the equation. Equally 
important is the routing of the oil and natural gas export pipelines. 
Officials from the Ministry of Foreign Affairs (MID) have been adamant that 
the oil from the Caspian be piped through Russia.1 In the most benign 
interpretation, this would allow Russia to garner transit fees; more 
malignant observations are that Russia is determined to control the exports 
of the former Soviet republics. Indeed, until recently, the only operative 
pipeline went through Chechnya to the Black Sea port of Novorossiisk. 
Beginning in November 1997, early oil has been exported via the pipeline to 
Novorossiisk, and, starting in April 1999, additional quantities have flowed 
to the Georgian port of Supsa.

In October 1999, the major oil companies agreed that Baku-Ceyhan would be the 
main export pipeline of Caspian oil. From the outset, the US has been pushing 
for a main export pipeline that would bypass both Russia and Iran, from Baku 
through Georgia to the Turkish Mediterranean port of Ceyhan. Nonetheless, 
Russian efforts to block Baku-Ceyhan continued: Russian envoys traveled to 
the Caspian in a major initiative to dissuade Azerbaijan, Kazakhstan, and 
Turkmenistan from signing the agreement. In November 1999, on the sidelines 
of the Istanbul OSCE summit, a formal agreement for Baku-Ceyhan was signed by 
the presidents of Turkey, Azerbaijan, Georgia, and Turkmenistan.

Although Caspian politics were not the reason for Vladimir Putin's 
appointment as acting president in December 1999, his accession to power 
immediately followed what was seen as a political and economic defeat for 
Moscow and a victory for the US. Moreover, he brought to the job a marked 
determination to restore Russia's great power status. That the US was the 
promoter of Baku-Ceyhan at a time when contacts between the new littoral 
states and NATO were intensifying contributed to Russia's sense of loss. 
Perhaps most importantly, Russia's failure to prevent Baku-Ceyhan came just 
after the NATO fiftieth anniversary celebration and the formal accession of 
Poland, the Czech Republic, and Hungary to the military alliance. It also 
followed NATO's show of force in Kosovo. Statements by Russian Foreign 
Ministry officials make clear that this is the prism through which Caspian 
politics is viewed. At a meeting in May, Ambassador Andrei Urnov, head of the 
Foreign Ministry's Caspian Working Group stated: "certain outside forces are 
trying to weaken Russia's position in the Caspian basin by driving a wedge" 
between Moscow and the new littoral states.2 There could be no doubt that the 
US was the target of these remarks.

Putin's policies

On April 21, 2000 the Russian Security Council discussed the Caspian. 
According to Russian media reports, Putin stated: "We must understand that 
the interest of our partners in other countries--Turkey, Great Britain, and 
the USA--toward the Caspian Sea is not accidental. This is because we are not 
active. We must not turn the Caspian Sea into yet another area of 
confrontation, no way. We just have to understand that nothing will fall into 
our lap out of the blue, like manna from heaven. This is a matter of 
competition and we must be competitive."3 The meeting also created a new post 
of special presidential representative for the Caspian. Viktor Kaluzhny, the 
former minister of energy, was appointed to the position and charged with 
enhancing Russia's presence in the Caspian.

Since his appointment as Putin's special representative, Kaluzhny has 
traveled to each of the littoral states. Kaluzhny claims that Moscow backs 
the sectoral division of the Caspian Sea bed, but not the surface waters. 
This somewhat confusing formulation means that Russia has in fact conceded 
the division of the Caspian into national sectors, but that Putin's 
government is determined to block the several US proposals for trans-Caspian 
pipelines. One idea he has been promoting is a Center for Strategic Economic 
Planning for the Caspian, to facilitate joint exploitation of the sea's 
energy resources. A second is a new proposal for joint development of 
disputed fields. Both proposals contain echoes of Moscow's initial stance on 
the Caspian: agreement by all the littoral states to any deals. By the same 
token, the bid for joint exploitation of disputed regions would garner Moscow 
a role in an area in the northern Caspian that is claimed by both Russia and 
Kazakhstan.

This concerted Russian lobbying effort coincided with the publication of the 
new Russian foreign policy concept, which contains clear references to the 
Caspian.

Serious emphasis will be made on the development of economic cooperation, 
including the creation of a free trade zone and implementation of programs of 
joint rational use of natural resources. Specifically, Russia will work for 
the elaboration of such a status of the Caspian Sea as would enable the 
littoral states to launch mutually advantageous cooperation in using the 
region's resources on a fair basis and taking into account the legitimate 
interests of each other.4

Equally important, the concept gives voice to the idea that the reassertion 
of Russian influence in the Caspian is both a commercial and diplomatic 
endeavor.

Viewing the Greater Mediterranean as a hub of such regions as the Middle 
East, the Black Sea region, the Caucasus, and the Caspian Sea basin, Russia 
intends to steer a purposeful course for turning it into a zone of peace, 
stability, and good neighborliness, something that will help advance Russian 
economic interests, including in the matter of the choice of routes for 
important energy flows.5

Earlier, Putin stated at that Security Council meeting in April: "The key 
issue in this sense is the balance of interests of the state and mineral 
resource companies. We must realize the efforts of the state alone will not 
be enough for implanting the Russian companies there."6 To that end and 
clearly encouraged by the Kremlin, the Russian oil companies, LUKoil and 
Yukos teamed up with the natural gas company Gazprom to form the Caspian Oil 
Company. In a press conference to announce the new company, LUKoil's first 
vice president, Ravil Maganov, stated that the new company would "help Russia 
strengthen its stand in the region."7 

Thus far these new initiatives have not been accepted by the other littoral 
states. All rejected the idea of the Economic Center and have been silent on 
the proposal for joint exploitation of disputed sites. By the same token, the 
other littoral states have been receptive to the fact of the diplomatic 
activity. They remain wary, however, of Russia's other policy 
implements--such as the manipulation of the Nagorno-Karabagh conflict, 
charges against Azerbaijan and Georgia that they are harboring Chechen 
fighters, and the slow pace of negotiations over the final disposition of 
Russian bases and weaponry in Georgia. 
US Policy

Since it began promoting the Baku-Ceyhan pipeline, the US has been telling 
Russia that it is not trying to exclude Moscow from the Caspian region. 
Despite these US avowals, it is clear that officials in Moscow remain 
unconvinced.

Thus the first order of business for the US is to clarify our objectives in 
the region and to articulate them clearly. If an open confrontation between 
Moscow and Washington is to be avoided, the US should be sensitive as to how 
its policies are viewed in the Kremlin. As noted above, the almost 
simultaneity of the Baku-Ceyhan agreement with NATO expansion and Kosovo only 
exacerbated the worst fears of Russian officials. And this was before Putin 
came to power determined to reassert Russia's great power status. 
As a corollary, the US also needs to understand how its policies are viewed 
in the other regional capitals. It must assure that Baku, Tbilisi, and 
Ashgabat do not use ties with Washington in an anti-Russian manner. The best 
example of what should be avoided was when former Azerbaijani presidential 
advisor Vafa Guluzade invited NATO to establish bases in Azerbaijan.
Finally, in this regard Washington must ensure that Moscow sees the Caspian 
Pipeline Consortium (CPC) as its stake in the Caspian game. This pipeline 
runs from the Kazakh Tengiz field through Russian territory to the Russian 
Black Sea port of Novorossiisk. The Russian government has a 24 percent stake 
in the pipeline and an additional 20 percent is held by LUKoil and Rosneft; 
moreover, the private oil company participants, most notably Chevron and 
Mobil are financing construction. The CPC is now scheduled to be completed in 
2001.

Washington must also recognize that the politics of oil and natural gas are 
different. The US focus has been on Baku-Ceyhan, which is an oil pipeline. At 
the same time, the US has been promoting the trans-Caspian gas pipeline so as 
to free Turkmenistan from Russia's stranglehold. From Russia and Gazprom's 
perspective, were Turkmenistan to secure alternative export routes, it would 
emerge as a significant rival to Gazprom. The discovery of vast gas reserves 
at Azerbaijan's Shah Deniz field alters all the states' calculations still 
further. All see Turkey as the major purchaser of their natural gas and a 
central transit point for sales to the growing European market. For 
Turkmenistan, access to the Turkish market was to be assured through the 
proposed trans-Caspian pipeline from Turkmen gas fields to Azerbaijan and 
then on to Turkey. For Gazprom, the 1997 Blue Stream agreement with Turkey to 
supply gas via a pipeline that would go under the Black Sea was its lock on 
the Turkish market. With the discoveries at Shah Deniz, Azerbaijan emerges as 
a formidable rival to both Gazprom and Turkmenistan: Azerbaijani gas will be 
cheaper to export because of the proximity to Turkey. Turkmenistan needs 
Azerbaijan's cooperation on the trans-Caspian pipeline, but the two are 
wrangling over the percentage of throughput capacity dedicated to Azerbaijani 
gas. At the same time, Gazprom has concluded a deal with Turkmenistan and is 
currently in negotiations for more purchases. There has been speculation that 
these negotiations are spurred by Gazprom's shortages in southern Russia and 
by its need for enough volume to make Blue Stream viable. From Turkmenistan's 
perspective, it may well turn out that export via Russia is the least-worst 
scenario.8 These new rivalries complicate US policy and should be a reminder 
of the intricacies of the region. 

Finally, the community of interests between Moscow and Tehran is strengthened 
by their mutual exclusion from the Caspian by the Baku-Ceyhan pipeline. Until 
recently, both adopted similar stances on the status of the Caspian Sea. Over 
the past few months, there has been some attenuation of the relationship: 
Russia's acceptance of the sectoral division of the Caspian has left Iran as 
the odd man out. Now Tehran is demanding that each of the littoral states 
receive a 20 percent share of Caspian resources--seemingly more than the 
other littoral states are willing to concede. Most recently, Tehran and 
Ashgabat refused to attend a meeting of the Caspian states that was to be 
hosted by Moscow. The meeting was ultimately canceled. Iranian inclusion in 
US pipeline proposals--within the framework of multiple pipelines--might 
create a situation in which Iran and Russia emerge as competitors for export 
routes, thus further attenuating ties between Tehran and Moscow. It would 
certainly facilitate greater flexibility for Turkmenistan, Kazakhstan, and 
Azerbaijan as they search for ways out of Moscow's Shadow. 
[footnotes not here]

*******

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