CDI Russia Weekly-#111

21 July 2000

Edited by David Johnson

Center for Defense Information

1779 Massachusetts Ave. NW

Washington DC 20036

phone: 202-332-0600; fax:202-462-4559

djohnson@cdi.org

The CDI Russia Weekly is an e-mail newsletter that carries news and

analysis on all aspects of today's Russia, including political,

economic, social, military, and foreign policy issues. With funding

from the Carnegie Corporation of New York, CDI Russia Weekly is a

project of the Washington-based Center for Defense Information (CDI),

a nonprofit research and education organization.

  CDI Russia Weekly web page (with archive): http://www.cdi.org/russia/

  Visit CDI's web site: http://www.cdi.org

Contents:

  1. AFP: Russia, US set to lock horns over missile shield.

  2. The Russia Journal: Vladimir Kozin, Clinton set to bow out with failure on nuclear talks.

  3. BBC: Russian press predicts tycoon's demise.

  4. Jamestown Foundation Monitor: LEADING "FAMILY" MEMBERS REPORTEDLY WANT NTV AND NORILSK.

  5. Moscow Times: Pavel Felgenhauer, DEFENSE DOSSIER: Both Sides of Babble Right.

  6. RFE/RL: Bruce Pannier, Central Asia: U.S. Interests Suffer Setbacks.

  7. smi.ru: Putin and the Chinese: Who Has Been Had by Whom?

  8. Krasnaya Zvezda: JOINT STATEMENT OF PRESIDENT VLADIMIR PUTIN OF THE RUSSIAN FEDERATION AND CHAIRMAN JIANG ZEMIN OF THE PEOPLE'S REPUBLIC OF CHINA ON ABM.

  9. Russian Life: Mikhail Ivanov, Sprinting the Marathon.

  10. Moscow Times: Simon Saradzhyan, Pyongyang May Scrap Missiles for Aid.

  11. The Globe and Mail (Canada): Geoffrey Yori, Shevardnadze treads thin line.              Republic of Georgia leader courts West, but his land is still

dominated by Russia.

*******

#1

Russia, US set to lock horns over missile shield

NAGO, Japan, July 20 (AFP) -

Russian President Vladimir Putin looks set to lock horns with US President

Bill Clinton over a US scheme for a ballistic missile shield at a Group of

Eight summit here.

In a pre-summit Asian tour, Putin won backing from Chinese President Jiang

Zemin and North Korean supreme leader Kim Jong-Il against the national

missile defence (NMD) scheme.

Barely two weeks ago, the United States admitted an interceptor rocket had

failed to shoot down an incoming dummy warhead during a 100-million-dollar

test of its prototype NMD system.

The botched test was an acute embarrassment to the Pentagon and Clinton, who

is due to take a decision on whether to deploy the 60-billion-dollar system

by the year's end.

The United States was already under pressure to defend the NMD from Russia

and its allies at a G8 foreign mininsters last week in the southern Japanese

city of Miyazaki.

But Putin appeared to be turning up the heat ahead of the three-day G8 summit

starting Friday in Naha, a beachside city on the southern Japanese island of

Okinawa.

On Tuesday he issued a joint statement with Jiang specifically aimed at the

system.

"Russia and China appeal to the international community to pay great

attention to those countries who are trying to develop by force an

anti-missile defence system which could upset the world's strategic balance,"

it said.

On Wednesday, the Russian leader and Kim Jong-Il also signed a memorandum

opposing any changes to the 1972 Anti-Ballistic Missile (ABM) treaty,

ITAR-TASS said.

And he packed further ammunition by winning an offer from Pyongyang to

abandon missile development in return for rocket technology to help a

supposed space program.

Washington, which cites the threat of a ballistic missile attack from states

like North Korea as a reason for the NMD, reacted coolly to Putin's

announcement.

"I would remind you that the North Koreans demonstrated ballistic missile

capability with what they called a space or satellite launch," one US

official said.

Pyongyang test-fired a ballistic missile over Japan without warning in August

1998, stunning the region. The Stalinist regime insisted it had merely put

into orbit a satellite emitting revolutionary songs.

"I understand that this is a question to be discussed particularly between

the United States and Russia," Foreign Minister Yohei Kono told a news

conference this week.

"Russian President Putin is expected to discuss with US President Clinton

questions related to the NMD," Kono said.

In Miyazaki last week, Russian Foreign Minister Igor Ivanov joined other G8

representatives in questioning the fall-out from any deployment of the NMD

system.

US Deputy Secretary of State Strobe Talbott had to fend off concerns that the

unproven shield threatened to undermine the ABM treaty.

*******

#2

The Russia Journal

July 15-21, 2000

Clinton set to bow out with failure on nuclear talks

By Vladimir Kozin, deputy director of the apparatus of the Duma committee

on international relations

Outgoing U.S. President Bill Clinton’s visit to Moscow at the beginning of

June was one of missed opportunities rather than a resounding closing note

to the eight-year period in Russian-U.S. relations that coincided with

Clinton’s presidency.

Unlike his predecessors George Bush and Ronald Reagan, Clinton didn’t sign

any significant nuclear arms reduction agreements. For example, Clinton

could have agreed to more detailed and mutually acceptable principles for

the START III treaty, but he didn’t. The Russian side was very much behind

the idea, proposing to Washington a reduction from 2,500 strategic warheads

­ the limit agreed upon in Helsinki in 1997 ­ to 1,500 warheads.

The United States sharply criticized Russia for all the holdups with

ratification of the START II treaty, but then lost the pace itself and

still hasn’t ratified eight highly important international and bilateral

arms control agreements. These include the Comprehensive Test Ban treaty,

the protocol extending START II, the New York agreements on the ABM treaty

and an agreement on confidence-building measures related to ABM systems.

The new Russian State Duma has ratified all these agreements.

Russia and the United States could have reached an agreement during

Clinton’s visit on not launching a first strike against the other side. The

two countries had reached an agreement in the early ’90s on not targeting

ballistic nuclear missiles against each other’s territory and could have

taken the opportunity to go further in this direction.

The opportunity was also missed to agree on reducing the number of

strategic nuclear targets. The Pentagon still has 2,260 strategic targets

on Russian territory, in accordance with the integrated operative plan

approved by Clinton in 1997. About half of these targets designated for

nuclear attack are large Russian towns and industrial centers.

There were some positive points concerning the ABM issue, noted in the

joint declaration on strategic stability made during the Moscow visit, but

the United States included in the declaration a phrase about reevaluating

possible changes to the strategic situation, which would affect the ABM

treaty. This gives Washington a loophole to adapt the ABM treaty to its

interests. It’s no coincidence that there was no talk in Moscow from

Clinton of U.S. commitment to fully observe the ABM treaty in accordance

with the principles of strategic stability and preserving the delicate

balance between offensive and defensive weapons.

The ancient saying goes that "pacta sunt servanda" ­ treaties must be

observed. But instead of upholding this principle, Clinton promised to make

the situation on possible modifications to the ABM treaty clear by the end

of this year. What is clear is how the United States is trying to get

around the restrictions of the ABM treaty by developing and intensively

modernizing its radar-location station network and building new stations in

places like Alaska and Norway.

Prospects for U.S.-Russian relations will probably depend on how the

negative and positive results of Clinton’s visit end up balancing out. So

far, the balance is in favor of missed opportunities. Future catching up on

these missed opportunities will depend on the plans of the new U.S. president.

*******

#3

BBC

20 July 2000

Russian press predicts tycoon's demise

Russian tycoon Boris Berezovsky's decision to resign from parliament has

prompted some of the country's press to predict his downfall.

"In effect this means the departure of the 'grey cardinal' of Boris Yeltsin's

regime," Izvestiya said.

"He has realized that he has no place in Putin's team."

Berezovsky's position was symptomatic of the waning power of the oligarchs in

general, the daily maintained.

"The attempt to set up a 'constructive opposition' of oligarchs and governors

headed by Berezovsky is doomed to failure," it said.

"These are a dying breed, and they cannot effectively resist the president's

plans to reform the entire system of political and economic power."

Bridges burned

Novaya Gazeta said that now there was no way back for Berezovsky into the

Kremlin.

"Berezovsky's unprecedented attack on the president on all fronts means that

he has realized that the bridges linking him with the Kremlin, and with

Putin, have been burned," it said.

He was now in a no-win situation, it added. "Boris Abramovich is in a

zugzwang, as they say in chess," it said.

"Every move he makes only worsens his position."

Empty gesture

Moskovsky Komsomolets said that Berezovsky, who is himself under

investigation for tax irregularities, had made an empty gesture in giving up

his parliamentary immunity, because MPs would cheerfully have waived it

anyway.

"Boris Abramovich knows that no immunity can save him," it said.

"At the first opportunity the Duma will gladly surrender the oligarch because

there is no-one in the country more unpopular."

Crackdown on oligarchs

Berezovsky's announcement seemed to echo press reports last week on a

crackdown on the oligarchs.

Komsomolskaya Pravda spoke of two scenarios: either "a massive and final

'cleansing' planned for the autumn of all 'bad' oligarchs" or mass protests

by Putin's supporters which would destroy his opponents.

And several newspapers ominously compared the current situation to the end of

the 1920s, when Stalin reversed Lenin's New Economic Policy (NEP), which had

contained some free-market elements.

"When at the end of the 1920s the Soviet regime got down to winding up NEP

some of the class enemies were extremely lucky," Moskovsky Komsomolets said.

"They were not just graciously allowed to hand over everything they had but

even to stay at their former plants or factories as hired specialists."

Laughable words

But some newspapers took Berezovsky's prophesies of doom with a pinch of

salt.

"Berezovsky's words about the collapse of the country and authoritarianism

are laughable for the man in the street," Izvestiya said.

"After all, it is Berezovsky who has been named as one of the main culprits

of the crisis in Russian statehood and in the economy as well."

Novaya Gazeta was surprised by what it saw as his clumsy attempts to evoke

the spirit of democracy.

"Berezovsky's youthful fervour and his leap into the breach in the name of

democracy and truth are amazing," it said.

"He's used to coming to terms for surrender, or buying seemingly inaccessible

fortresses - as was the case with several anti-Berezovsky newspapers."

*******

#4

Jamestown Foundation Monitor

July 20, 2000

LEADING "FAMILY" MEMBERS REPORTEDLY WANT NTV AND NORILSK. Russian observers

remain split over whether the moves against Vladimir Gusinsky, Vladimir

Potanin and the other oligarchs are being dictated by those holding "sway"

over the Kremlin. By this meaning two groups. First, the "Family"--those

Yeltsin-era Kremlin insiders among which are or have been the tycoons Boris

Berezovsky and Roman Abramovich and Kremlin chief of staff Aleksandr

Voloshin. Second, the KGB and Russian security service veterans whom

President Vladimir Putin has elevated since his accession as head of

state--which include Sergei Ivanov, secretary of the Security Council, a

powerful presidential advisory body.

The Gazeta.ru website speculated today that the move against Gusinsky and

Media-Most may originally have been sparked by Abramovich, who controls

Sibneft, the oil company which recently helped form a new holding which

itself now controls up to 80 percent of Russia's lucrative aluminum

industry. Abramovich reportedly may want to take Media-Most for himself. On

the other hand, the web site said, Putin and his associates may themselves

want to control Media-Most's NTV, along with Russian Public Television

(ORT), the 51-percent state-owned television channel generally thought to

be controlled by Berezovsky. It was suggested that competition between the

two "clans"--the "Family" and Putin's "Chekists"--is growing notably more

pitched.

Expert, the weekly magazine owned by Potanin's Interros, said this week

that Abramovich, Moscow banker Aleksandr Mamut and "one of the Chorny

brothers"--a reference to Mikhail and Lev Chorny, who reportedly controlled

most of Russia's aluminum until recently--want to get control over Norilsk.

The magazine cited "experts" as saying that the "Family" remains

"objectively stronger than the president" (Ekspert, July 17). Today,

Kommersant, the newspaper owned by Berezovsky, suggested that Berezovsky

himself may be behind the prosecutor's steps against Norilsk (Kommersant,

July 20). It is worth noting here that the motion in the Duma to declare

the Norilsk privatization invalid was introduced by introduced by Aleksei

Mitrofanov, a member of Vladimir Zhirinovsky's Liberal Democratic Party of

Russia, who also called this week for Berezovsky to be named Russia's first

civilian defense minister (Russian agencies, July 19).

Berezovsky, meanwhile, yesterday formally gave up his seat in the State

Duma representing the Karachaevo-Cherkessia national republic and vowed to

continue his opposition to Putin's centralization plans. Mikhail Berger,

editor of Segodnya, Media-Most's newspaper, suggested that Berezovsky's

very public show of leading the "constructive opposition" to Putin may be

part of an attempt by him to convince the Kremlin to join him in a

"political game," but that they Kremlin may be uninterested (Segodnya, July

19). The Swiss authorities, meanwhile, said yesterday that US$715 million

were diverted from Aeroflot, the Russian state airline, in a scheme that

allegedly involved two Swiss front companies set up by Berezovsky (AP, July

19).

*******

#5

Moscow Times

July 20, 2000

DEFENSE DOSSIER: Both Sides of Babble Right

By Pavel Felgenhauer

For more than two years it has been well known that Defense Minister Marshal

Igor Sergeyev and his No. 2 in the defense hierarchy f Chief of Staff General

Anatoly Kvashnin f were locked in bitter personal conflict.

Most of the time the two have been barely on speaking terms, but it was only

last week that the fray became public when Kvashnin presented a plan to

drastically cut in size the strategic nuclear rocket forces and relocate

expenditure from nuclear to conventional arms. Kvashnin also proposed that in

the future the down-sized Strategic Missile Forces should be eliminated as a

separate branch of the military and made a division of the Air Force.

Sergeyev f a professional Strategic Missile Force officer f saw this as a

personal challenge and lost his temper in public. Sergeyev accused Kvashnin

of "criminal stupidity" and "an attempt to harm Russia's national interests."

But nothing substantial seemed to happen after these strong words were

spoken. In the West, such public insults would have led at least one of the

parties to resign. Here the protagonists stayed in service: Sergeyev traveled

with President Vladimir Putin to Beijing and North Korea, while Kvashnin

remained in Moscow in operational command of the nation's armed forces,

including control of the strategic nuclear deterrent.

After meeting Putin before the China trip, Sergeyev even announced that he

and Kvashnin had similar views "on the present state of the Russian

military," but that they disagreed on what to do to about the situation. It

was announced that the Security Council will discuss the problem soon.

It would seem the conflict was almost resolved, Russian-style. But this

conflict is different, it's much more than a personality clash f it reflects

a deep crisis in national defense policies.

Since becoming defense minister in 1997, Sergeyev has channeled virtually all

Defense Ministry procurement money to buy new intercontinental ballistic

missiles.

For the past couple of years the country has procured 20 to 30 ICBMs a year f

the most modern SS-27 (Topol-M) and also the SS-25 (Topol) f to replace

rockets that were decommissioned after more than 10 years of service. Russia

was building more ICBMs than all other world nuclear powers put together, but

not buying any new conventional arms.

As a result, the military entered Chechnya last fall without any attack

helicopters or fixed-wing aircraft capable of operating at night or in fog,

without modern communication equipment and so on. Today in Chechnya, federal

troops often go intobattle without body armor and wearing bandanas instead of

steel helmets not only because they are undisciplined, but also because

out-of-date army-issue flak jackets and steel helmets only impede soldiers'

movements, while offering almost no true protection.

The U.S. army estimates that modern body armor can decrease personnel losses

by at least 50 percent. Last March, a company of almost 100 paratroopers was

wiped out by rebels in the Chechen mountains. The official explanation for

this disaster was that fog did not allow any air support.

Russian arms producers have over the past decade developed modern helmets,

body armor, night attack helicopters and other effective infantry-support

systems. But none of them was procured in any sizable quantity because

Sergeyev spent all the available money to buy ICBMs. Losses in Chechnya may

have been much smaller and indiscriminate bombardments of civilian targets

could have been avoided if more modern conventional weapons were used.

In Chechnya, ill-equipped federal forces are failing to contain rebel

attacks. If a new conventional conflict erupts while the army is bogged down

in Chechnya, the result could be disastrous. Today, Kvashnin is supported by

many generals who understand that without new conventional weapons Russia may

be defeated in Chechnya and also may lose the capability to fight effectively

in any local war.

However, it is also obvious that Sergeyev has a point: Without new ICBMs the

nation may lose its status as a nuclear superpower.

This basic conflict f the inability of modern Russia to maintain in

high-combat readiness numerous conventional and nuclear forces at the same

time f cannot be resolved by ousting either Sergeyev or Kvashin. It cannot

even be resolved by ousting both at the same time. Putin has for the time

being chosen to postpone making painful decisions, but he cannot sit on the

fence for ever.

Pavel Felgenhauer is an independent, Moscow-based defense analyst.

*******

#6

Central Asia: U.S. Interests Suffer Setbacks

By Bruce Pannier

If diplomatic activity is any indication, U.S. influence seems diminished in

CIS Central Asia, while that of Russia and China is growing. Those two

countries recently sent their presidents to Central Asia, while the United

States sent only its secretary of state. RFE/RL's Bruce Pannier reports that

the U.S. now looks like a lesser partner -- but it may just be taking a

longer view.

Prague, 18 July 2000 (RFE/RL) -- U.S. envoy Stephen Sestanovich visited

Central Asia last week to follow up on work done by his boss, Secretary of

State Madeleine Albright, in April. Sestanovich traveled to Turkmenistan,

Kazakhstan, Kyrgyzstan, and Uzbekistan.

Although his agenda varied from country to country, his general message

boiled down to this:

"We aim to deepen our cooperation in a whole series of areas, whether it's by

finding ways to increase educational exchanges, or to prepare for joint

military exercises, or to share perspectives on multilateral diplomacy."

That was Sestanovich in Kazakhstan last Tuesday.

He has reason to seek deeper cooperation. CIS Central Asian governments have

adopted a somewhat chillier attitude toward the U.S. recently. Since

Albright's visit in April, Russian President Vladimir Putin has been in the

region twice, and Chinese President Jiang Zemin was there at the start of

this month. In a region where leaders once eagerly courted ties with the

U.S., Washington may now be third, or farther down, on the list of Central

Asia's friends.

Sestanovich's first stop was Turkmenistan, a country where U.S. influence has

particularly suffered.

Two U.S. companies, Bechtel and General Electric, last month pulled out of an

international consortium that was to build a pipeline to carry Turkmen

natural gas across the Caspian Sea. Sestanovich attempted to convince Turkmen

officials that the departure of the two companies did not mean the project

was dead. But Turkmen President Saparmurat Niyazov told Sestanovich the deal

as it stands now is not in the interests of Turkmenistan.

While the trans-Caspian pipeline deal was starting to unravel, Putin visited

Turkmenistan in May. And as of this month, exports of Turkmen gas to Russia,

via a Russian pipeline, were reportedly reaching 100 million cubic meters

daily.

Meanwhile, Jiang Zemin came to Turkmenistan with officials from the China

National Petroleum Corporation. They signed deals to help Turkmenistan

develop oil and gas fields and construct a 5,000-kilometer oil pipeline from

eastern Turkmenistan to China.

The U.S. secretary of state, however, did not visit Turkmenistan during her

trip to Central Asia in April. But Albright did travel to the next three

countries on Sestanovich's schedule -- Kazakhstan, Kyrgyzstan, and

Uzbekistan.

Putin also visited Uzbekistan, in May. And he met with the Uzbek, Kazakh, and

Kyrgyz presidents at the CIS summit in Moscow in late June. Then Putin met

them all again in Tajikistan at the start of this month, when the Shanghai

Forum met. Jiang was also at that summit and met with the four Central Asian

presidents before traveling further to meet the Turkmen president.

The CIS summit and Shanghai Forum summit focused Central Asian attention on

the region's security problem. An assassination attempt on the Uzbek

president's life last year and an invasion of southern Kyrgyzstan by Islamic

militants later that summer has made that amply evident.

The U.S. has provided money and advice on security. But, not least because of

geography, the U.S. cannot compete with Russia and China in helping Central

Asia combat its immediate security threats.

The Central Asian leaders received promises of military assistance from the

presidents of China and Russia. What they received from Albright in April was

vocal support in their fight against terrorism and the small sum of $3

million each for Kazakhstan, Kyrgyzstan, and Uzbekistan to bolster their

border defenses.

The U.S. emphasis on democracy building might further encourage the Central

Asians to turn to their less exacting neighbors. Both Albright and now

Sestanovich told Central Asian countries they need to improve in that area.

And the U.S. agreed with international bodies that criticized the most recent

elections in the region. Russia and China, in contrast, maintain that the

internal affairs of Central Asian countries are their own business.

Putin and Jiang have also aimed some criticism at the U.S. by raising the

issue of U.S. plans to build and deploy a national missile defense system.

Both Russia and China said deployment would violate the 1972 Anti-Ballistic

Missile Treaty. Now, the Central Asian leaders are echoing that line.

Sestanovich did not appear to have accomplished much last week. No deals were

signed, and no joint statements came out of any of the meetings he had with

regional leaders.

Still, as the Asian Wall Street Journal points out, while Russian and Chinese

efforts to boost their influence may be working for now, "these authoritarian

governments have failed to acknowledge that the best defense against

extremism is democracy and economic opportunity."

The U.S. policy toward Central Asia is based on this idea.

(Merhat Sharipzhan of the Kazakh Service contributed to this report.)

*******

#7

smi.ru

July 20, 2000

Putin and the Chinese: Who Has Been Had by Whom?

Vladimir Putin's visit to China has been really triumphant. As the Russian

President put it himself, "this has been an extremely emotionally charged

meeting. I have to say that my best, my boldest expectations have come true.

The Chinese colleagues, partners, friends have surrounded us with an

atmosphere of the utmost goodwill". "Moscow Suburb Nights" has been sung

together, Russian poetry has been recited, an agreement has been reached to

jointly fight the US in case it "wrecks" the 1972 ABM Treaty, the relations

of "strategic partnership" bequeathed to the two countries by Boris Yeltsin

have been confirmed, promises have been exchanged to be friends from now on

and forever ... In general, things are just great - yet observers in the West

do not believe (or do not want to believe) in the sincerity of Putin's and

Jiang Zemin's cordial outbursts and want to penetrate the pretty facade and

see the truth in all its unseemly nakedness. That China and Russia are using

each other seems to be doubted by nobody. The only question is: who has

outwitted whom.

Comment: The Western media put forward two main theories concerning the

behind-the-scenes motives for the Russian-Chinese summit having had such an

emotional character. According to one of them, Moscow has outfoxed Beijing,

according to the other one, the situation is quite the opposite.

Theory Number One. Its fullest exposition may be found in the London Times.

According to this theory, Russia needed the whole business of signing the

joint communique on America's plans for a National Missile Defense System

(NMD) simply to obtain a trump card in its game of pressuring Washington.

China, because it has only about 25 intercontinental ballistic missiles, is

opposed to NMD more vehemently than Russia, so it would welcome any ally in

its struggle against what is, among other things, a very real menace to

China's own security. As to Putin, for him signing the communique was just

another move in the complicated game he is playing with the White House. It

is not for nothing that he phoned President Clinton shortly before his trip

and confirmed Russia's readiness to work with the US and NATO in a theatre

missile defense system. Russian commanders have been publicly admitting with

increasing frequency that an NMD of its own would come in handy for Russia,

as the country could be vulnerable to missile attack from five to eight

nations. As The Times puts it, "the lineaments of a potential security

bargain are discernible. But Mr. Putin needs for domestic purposes to be seen

to be negotiating from strength. Mr. Clinton knows that Russia could yet be

brought onside. As Putin plays to the Okinawa gallery, that is the objective

the US should keep in view".

Theory Number Two, featuring the traditional image of the cunning Chinese, is

expounded in Suddeutsche Zeitung. According to the German paper, China really

does not need any strategic or economic partnership with Russia. What China

does need is state-of-the-art weapons, like the two destroyers armed with

supersonic anti-ship missiles it has recently purchased from Russia. It needs

them to intimidate Taiwan or, still worse, to resell the riches thus obtained

to Iran, Iraq and the rest of the "rogue" states. Given that such weapons

cannot be gotten anywhere else but in Moscow, Jiang Zemin has to promise

Putin "mountains of gold" in the form of trade cooperation that will never

become reality. The current Chinese leaders, says the paper, are pragmatists.

They understand that, besides geostrategic interests and defending its

sovereignty, China also has economic interests, so it needs the US no less

than it does Russia. And trading with America is much more interesting for

China than trading with Russia. So Suddeutsche Zeitung recommends Bill

Clinton not to get too nervous about an anti-American alliance between Moscow

and Beijing, reminding him that the amount of Chinese-US trade is tens of

times that of the trade between China and Russia.

*******

#8

Krasnaya Zvezda

July 19, 2000

[translation from RIA Novosti for personal use only]

JOINT STATEMENT OF PRESIDENT VLADIMIR PUTIN OF THE RUSSIAN

FEDERATION AND CHAIRMAN JIANG ZEMIN OF THE PEOPLE'S REPUBLIC OF

CHINA ON ABM

     The President of the Russian Federation and the Chairman

of the People's Republic of China hereby state:

     The development of the international situation fully

revealed the correctness of the conclusions and evaluations of

ballistic missile defence issues provided in the Joint

Statement on Russo-Chinese Relations at the Turn of the 21st

Century, approved at the summit level on November 23, 1998, the

Russo-Chinese Information Communique on Consultations on

Questions Pertaining to the ABM Treaty, dated April 14, 1999,

and the Russo-Chinese Joint Statement approved at the summit

level on December 10, 1999.

     The 1972 Treaty on the Limitation of Anti-Ballistic

Missile Systems, hereinafter referred to as the ABM Treaty,

remains the cornerstone of global strategic stability and

international security and the basis of the structure of key

international agreements on the reduction and limitation of

strategic offensive weapons and on the non-proliferation of

mass destruction weapons.

The maintenance of and strict compliance with the ABM Treaty

are of vital significance.

     We are deeply worried in this connection by the US plan of

creating a national missile defence system prohibited by the

ABM Treaty. Russia and China believe that this plan boils down

to the striving for unilateral superiority in the military

sphere and security issues. The implementation of such plan

would have most serious negative consequences for the security

of not only Russia, China and other countries, but also for the

security of the USA itself and for global strategic stability

in the world as a whole. This is why Russia and China are

resolutely protesting against this plan.

     The destruction of the ABM Treaty would trigger off a new

stage of the arms race and turn back positive trends in global

politics that appeared after the end of the Cold War. This

certainly does not meet the vital interests of any state of the

world. States that advocate a review of this fundamental treaty

in the sphere of arms reductions will bear full responsibility

for undermining international stability and security and for

the consequences of this action.

     The analysis of the current international realities

reveals the complete invalidity of using the so-called missile

threat emanating from some states as a pretext for justifying

the demands for amending the ABM Treaty. The suggestions of the

so-called adjustment of the Treaty are designed to camouflage

the striving to act contrary to its provisions. A change of the

contents of the ABM Treaty would be tantamount to the

destruction of this Treaty, with all the ensuing negative

consequences. The preservation of the integrity and

effectiveness of the ABM Treaty in the obtaining strategic

situation is of vital and real significance.

     The correct manner of reacting to new challenges in the

sphere of international security, of maintaining peace the

world over and protecting the legitimate security interests of

any state lies not in the destruction of the ABM Treaty, but in

assistance to the creation of a fair and rational new

international political order, in the renunciation of the use

of policy from positions of strength and excessive use of armed

force in international affairs, and in further strengthening of

regional and global security. At the same time, it is vital

that Russia and the USA, acting on the basis of strict

compliance with the ABM Treaty, should carry on and develop the

process of the reduction of strategic offensive weapons,

subsequently involving other nuclear powers in this process at

the proper time. We must use political, legal and diplomatic

methods to build up international efforts to preclude the

proliferation of mass destruction weapons and their delivery

vehicles, to study the possibilities for the gradual creation

of a global system of control over the non-proliferation of

missiles and missile technologies, and to develop broad

dialogue and cooperation in this sphere without any

discrimination.

     Non-strategic ballistic missile defence and international

cooperation in this sphere, which are not prohibited in the ABM

Treaty, should not damage the security interests of other

countries, lead to the creation and strengthening of closed

military and political blocs, or undermine global and regional

stability and security. Proceeding from this precept, Russia

and China express serious concern and resolute protest against

the plans of some states to deploy such non-strategic missile

defence system in the Asia-Pacific Region that would have the

aforementioned negative consequences. The involvement of Taiwan

in any form in the ABM systems created by foreign states is

unacceptable and will seriously undermine stability in the

region.

     Of vital significance is the resolution on the maintenance

of and compliance with the Treaty on the Limitation of

Anti-Ballistic Missile Systems, approved at the 54th UN General

Assembly. Russia and China call on the international community

to continue paying serious attention to the actions of

corresponding states to quickly develop ABM systems that can

lead to the destruction of global strategic balance and

stability in the world, and to take requisite measures to

preclude these dangerous developments.

     We are satisfied with the progress of cooperation of

Russia and China in the sphere of the maintenance of global

strategic balance and stability. Proceeding from relations of

equal and confident partnership and strategic collaboration

between them, Russia and China will carry on their close

collaboration in the aforementioned sphere, and will develop

their cooperation in other related spheres, acting in the

framework of their international obligations, in the name of

ensuring their own, regional and global security.

    

     President Vladimir PUTIN        Chairman Jiang ZEMIN of

the Russian Federation       of the People's Republic  of China

     

********

#9

Russian Life

Sprinting the Marathon

By Mikhail Ivanov

Mikhail Ivanov is Executive Editor of Russian Life magazine, a bimonthly

magazine of Russian culture, history, travel and life.

MOSCOW, Jul 20, 2000 -- (Russian Life) Despite the brouhaha following the

arrest of media mogul Vladimir Gusinsky, Russian President Vladimir Putin

is staying his firm, energetic course, waging a fierce battle against the

oligarchs. New names are being added to the victims' list almost every

other day.

For the uninitiated, it is very tempting to draw a parallel between these

recent “cases” and the notorious “cases” of the 1930s and 1940s. In terms

of media coverage and the contagion-like spread of prosecutions, there

might indeed be some parallels. The piles of criminal files emblazoned with

the names of Russian oligarchs are growing like mushrooms after a rain. No

sooner had the dust settled on Gusinsky’s arrest than the owner of Norilsk

Nickel, Vladimir Potanin, came under fire. The Russian prosecutor’s office

offered him a chance to “reimburse” the state $140 million for having

bought the lucrative nickel concern on the cheap a few years ago. The

alternative: face criminal charges.

A few days later it was Lukoil's turn, with its boss, Vagit Alekperov,

facing criminal charges. Investigators are looking into details of credits

that Gazprom gave to Most Media. And leading Russian car maker Avtovaz and

its boss Vladimir Kadannikov are in the Federal Tax Police's sights. The

latter announced last week that a criminal case is being opened against

Avtovaz, whose managers allegedly swindled the state of hundreds of

millions of dollars by producing some 280,000 cars "on the black" (using

the same ID number of already existing cars).

To underscore the similarity between what the Russian press is terming

prosecutorial naezds ("naezd" is Russian thieves' slang for racketeers’

threats and attacks) and the late night arrests of the 1930s, the leading

Russian business daily, Kommersant, has taken to publishing regular front

page reports with a title that changes only the oligarch's name, e.g.

“Prishli za Potaninym” (“They came to pick Potanin”).

Even the scion of the Western establishment, Anatoly Chubais, has some

questions to answer regarding the sale of stocks to foreign investors in

energy megaholding company Unified Energy Systems. Everything may not have

been so clean with these sales, prosecutors are alleging.

Of course, for all the similarities between these show-investigations and

the show-trials of the 1930s, there is one big difference. Unlike the

millions of "enemies of the people" who fell prey to Stalin’s guillotine,

the Russian oligarchs are hardly innocents at large. It is a given that the

gigantic wealth they amassed in the 1990s was not gathered through hard

labor. As president of Parex Bank, Valery Kargin, put it: “the money earned

in that troubled epoch must lay somewhere for dozens of years before the

owners of the money will feel secure.”

The problem is that the system is as much to blame as the oligarchs

themselves. As President Putin himself acknowledged in his recent address

to the Federation Assembly, the old tax system was not compatible with

normal economics. Not that one should feel overly sorry for the oligarchs

who may now be pacing nervously about their piles of gold. But totally

uncompromising, unexpected changes in the rules of the game could well

criminalize any “agent who operated in the field of Russia’s fledgling

market economy." Strictly speaking, tens of millions of Russians could be

put behind bars for tax evasion ­ ending only with the babushkas who stand

by the metro selling cigarettes for a few rubles to help make up for their

pittance pensions. (Not that this work is insignificant—some 20% of all

retail sales in cigarettes here move through the babushkas!)

“Ah, your pension is too small or not paid regularly?" The tax policeman

says. "Tough luck! The law is equal for everyone.”

Who was it said something about a Dictatorship of the Law? ...

Time for a diplomatic solution. Which is why President Putin and the leader

of the right, Boris Nemtsov, agreed to set up a roundtable (rumble?) with

Russian business. The first session is to be held in late July, after Putin

returns from the G-8 meeting in Japan. Any later and, as Nemtsov quipped,

"there may be no businessmen left to sit at the table.”

The purpose of the meeting is apparently to draw up a charter outlining the

basic principles of relations between the powers that be and Russian

business, underscoring the principle of "equal distance of the business

from the powers that be.” The allusion here is obviously to the two

oligarchs who so far have been untouched in this battle against corruption:

Boris Berezovsky and Roman Abramovich. Reportedly, these two are the most

active, behind-the-scenes dealers associated with the “Family.”

Everything got a bit hotter early this week, when Berezovsky made a

spectacular move. On Monday he called press conference to announce his

resignation from the State Duma. He cited three reasons for his decision:

1) his disagreement with Putin’s proposed administrative reform, which is a

de facto liquidation of the Federation Council in its present form; 2)

mounting tensions in his electorate district, the Republic of

Karachaevo-Cherkessiya 3) his desire to relinquish his immunity from

criminal persecution and play “in the open” at a time “when the powers that

be” are attempting "to liquidate big business” in Russia.

Observers, meanwhile, cited a fourth reason for Berezovsky’s move: the

announcement coincided with investigators' stepped up efforts in the

Aeroflot case, to which Berezovsky is connected. For now, Berezovsky is

merely a witness in the case, but if he were to become one of the accused,

the State Duma would likely have stripped him off his immunity in any case,

given how much “sympathy” he has in that body. So, say such observers, it

is better for Berezovsky to strike first, so he can pose as an anti-Putin

dissident.

And yet Berezovsky is a chess player who is always thinking several moves

ahead of his opponent. If he is indeed, as some of his critics claim, in

the same boat as the Kremlin, this new maverick role might be an act to

show that the Kremlin makes no exceptions for any oligarch. Of course, if

his position is not so secure, he might be wise to start preparing his plan

of retreat to join the cohort of dissident businessmen like his long-time

rival Vladimir Gusinsky, so as to start using local and international media

to his benefit. Either reality helps explain his daring move.

In any case, the State Duma was expeditious in endorsing Berezovsky's

resignation request on Wednesday. In his farewell speech, Berezovsky said

he is leaving “with a clean conscience and a heavy heart” (which in Russian

means “halfheartedly,” or "with hard feelings”). What that latter statement

means is anyone's guess. As the famous former Soviet investigator Telman

Gdlyan warned: "If Berezovsky were to tell you he is going to the North

Pole, then one must look for him in the Antarctic.”

Meanwhile, rumor has it that law enforcement bodies have presented the

powers that be with a list of candidates for tax police shake-ups. The list

was allegedly OK'd by the Kremlin ... Needless to say, such a list would be

worth its weight many times over in gold to any investigative journalist,

much less an oligarch.

It is all very interesting, heady stuff. And, despite Putin's strong

approval ratings with the public, it is hard to rid oneself of the

impression that Putin is rushing to achieve too much, too fast, whilst this

public support lasts. He is fighting on too many fronts at once to be

successful on each. There is the war in Chechnya, fierce resistance of

governors to Putin's proposed revamping of the Federation Council, and now

the oligarchs ... During his first 100 days, the president has made enemies

enough for whole presidential term.

If he emerges safe and sound from all these battles, then, as the maxim

goes, "winner take all," and he can rule Russian as he pleases through two

presidential terms. But if the Kremlin cracks down on past economic

offenders, then the current ranks of the discontented (so far mostly

limited to the oligarchs and a small group of press intelligentsia) will be

swelled by millions of rank and file “small entrepreneurs” (anyone who has

tried to survive in the stormy sea of this transition economy). First the

infamous tax system needs to be made right (which the Duma refuses to do,

by the way), then the government can demand compliance with tax laws, not

the other way around.

Decisiveness and resolve are great for to bring the Chechen rebels to heel,

but trying to motivate people to do business honestly (without forcing them

to close up shop) takes more than that. It takes flexibility, patience and

consistency.

This is the same thing that distinguishes between a sprinter and a

long-distance runner. Indeed, the wave of attacks on Russian business

leaders evokes the words of another Vladimir -- Vladimir Vysotsky. The

prolific bard sang about a hapless sprinter who tried to use his familiar

racing tactics in a long distance race: "I rushed, running the 10,000 meter

race as if it were 500, and soon got tired as a flat tire.”

After so many raised hopes, it would be a pity to see the new president of

Russia share the sprinter’s fate.

*******

#10

Moscow Times

July 21, 2000

NEWS ANALYSIS: Pyongyang May Scrap Missiles for Aid

By Simon Saradzhyan

Staff Writer

Pyongyang's offer this week to give up its missile program is best seen as an

attempt by North Korea to use its much-feared ballistic missile program as a

bargaining chip to barter for aid to feed its undernourished citizens.

Russian news agencies quoted President Vladimir Putin as saying after his

Wednesday meeting with North Korean leader Kim Jong Il that "North Korea is

even prepared to use exclusively the missile technology of other countries if

it is offered rocket boosters for peaceful space research."

Responding to this statement, a U.S. State Department official said in a

phone interview Thursday that his country is hoping to "clarify" exactly what

North Korea meant when Putin meets Friday with the leaders of the world's

leading industrialized countries in the Japanese city of Okinawa.

While Putin may be hoping to use the offer as a further weapon to undermine

U.S. attempts to renegotiate the 1972 Anti-Ballistic Missile Treaty,

Pyongyang is probably more interested in the bottom line. Indeed, Putin

indicated that because the United States sees North Korea as a threat,

Washington should be the main financier for a peaceful Pyongyang space

exploration program.

"Why should Russia alone pay? One should expect other countries, if they

assert that North Korea poses a threat for them, would support this project,"

Putin said

The North Korean "offer" is probably an attempt to win concessions in return

for swapping its nuclear power program for a civilian nuclear program, said

Ivan Safranchuk, strategic arms expert with the Center for Policy Studies.

In a telephone interview Thursday, Safranchuk said that Pyongyang struck a

very similar deal with South Korea, Japan and the United States over its

nuclear program in the past.

First, North Korea announced in March 1993 it would withdraw from the Nuclear

Nonproliferation Treaty, making it clear it was pursuing a nuclear arms

program. Pyongyang then tested a ballistic missile in May 1993.

Suddenly, in June 1993, North Korea agreed not to withdraw from the NPT.

In 1994, former U.S. President Jimmy Carter and North Korea's Kim Il Sung

agreed Pyongyang would abandon its nuclear program in exchange for deliveries

of fuel and construction of two nuclear reactors to be funded by Japan and

South Korea and completed in 2003.

Independent strategic arms expert Vladimir Belous agreed with Safranchuk that

Pyongyang will probably agree to "cash in" its missile program the way it did

with its nuclear arms program.

Both Safranchuk and Belous said Pyongyang has advanced far enough in the

development of intercontinental ballistic missiles that it can demand a hefty

price for scrapping the program.

Indeed, North Korea has already test launched what it said was a Taepo Dong-1

space rocket in August 1998 to demonstrate its capability to build

three-stage rockets. North Korean missile designers are working on a Taepo

Dong-2, which most international military experts say could reach Alaska.

The United States may agree to provide aid to Pyongyang, provided North Korea

scraps its missile program and allows verification by an international

watchdog body, said Nicholas Berry, arms control expert with the

Washington-based Center for Defense Information.

*******

#11

The Globe and Mail (Canada)

20 July 2000

Shevardnadze treads thin line

Republic of Georgia leader courts West,

but his land is still dominated by Russia

GEOFFREY YORK

Tbilisi, Georgia

This sun-drenched republic was once a sleepy southern backwater of the Soviet

Union, known mostly for its sweet red wine and curative mineral waters. Now

Georgia finds itself on the front lines of a battle for influence between the

Kremlin and the West.

During the Cold War, the United States and the Soviet Union faced off in

proxy fights across much of the world, especially in places such as Cuba,

Afghanistan and Angola.

But Russia's international clout is not what it once was. Now, the

geopolitical tug-of-war has moved right onto Russia's doorstep. And though

Russia still enjoys vast economic and military power in the ex-Soviet states,

some are quietly drifting into the West's embrace.

Indeed, the West has won most of the key battles recently in the small

republic of Georgia in the strategic Caucasus Mountains.

Georgia's openly pro-Western President, Eduard Shevardnadze, won a landslide

election victory earlier this year. Georgia receives millions of dollars in

U.S. aid for its border troops, and is establishing tighter links to the

West's military network, accepting visits from top leaders of the U.S.

Central Intelligence Agency and the North Atlantic Treaty Organization.

The West, led by high-powered U.S. diplomats and businessmen, is trying to

integrate Georgia into a network of Western transportation, trade and

military links.

But Moscow has reacted by flexing its own muscles, sending warplanes into

Georgian airspace and threatening with visa limits the 500,000 Georgians who

work in Russia. That has left many Georgians wondering in which direction

their country should turn, and whether it has tilted too much toward the West.

"We've found ourselves in a clash between two superpowers," said Zviad

Mirgatia, a political analyst in Tbilisi, the Georgian capital.

"Shevardnadze has become a client politician of the United States. It's a

very stupid position to be in. Like it or not, Russia is the regional

superpower. It's much more influential than the West here."

The Caucasus is an unstable zone of mountains, guns, ethnic tensions,

religious fault lines and untidy borders. But for the winners, the prizes are

lucrative.

The region is a gateway to the vast oil and gas resources of the Caspian Sea.

And the new symbol of Georgian independence is the planned $2.5-billion

(U.S.) pipeline that will stretch 1,700 kilometres from Baku, Azerbaijan's

capital on the Caspian Sea, across the territory of Georgia to the Turkish

port of Ceyhan, leading to export markets in the West.

The pipeline will allow the local oil industry to avoid Russian territory and

Russian control for the first time. Engineering work is under way, and the

pipeline is to be completed by 2004, although construction might be postponed

if oil exploration fails to find sufficient new reserves.

"Five years ago, Russia didn't even want to hear about a pipeline through the

Caucasus," said Gela Charkvian, head of foreign affairs in Mr. Shevardnadze's

office. "But now it's too late. How can they stop it?"

Still, Russia has several trump cards that the Americans cannot match. It has

10,000 troops on four military bases in Georgian territory; it has another

100,000 soldiers in nearby Chechnya; it wields great influence over the

separatist enclaves of Abkhazia and South Ossetia in what is still legally

Georgian territory; and it could cripple the Georgian economy by imposing

those visa restrictions.

"Russia is permanently putting pressure on Georgia," said Zaza Gachechiladze,

a newspaper editor in Tbilisi. "Russia wants the region to be a disaster zone

because it wants to control all of the oil and the pipelines. But our

reaction is the absolute opposite of what Russia wants. If you want me to be

your friend and you keep beating me, I'll never be your friend."

Throughout history, Georgians have felt squeezed by larger hostile powers.

They were the battleground for clashes between their aggressive neighbours.

Now they are trying to turn this to their own advantage.

"We have to use our strategic position," Mr. Gachechiladze said. "We are a

small country, and historically we survive by balancing between big nations."

>From the Georgian perspective, Moscow's heavy-handed interference in the

Caucasus arises out of nostalgia for the Soviet-era empire.

"It is a very painful process for Russia, psychologically, to adjust to the

idea that one day they'll have to withdraw their last soldier from Georgia,"

said Archil Gegeshidze, a senior foreign-policy adviser in the Georgian

government.

"Their policy has always been to divide and rule. But we are used to all of

these threats, blackmail and sabotage. We've developed a strong immune

system."

In an effort to resist Moscow's pressure, Mr. Shevardnadze, who won many

friends in the West when he was Soviet foreign minister under Mikhail

Gorbachev, has even suggested that Georgia could be "knocking on NATO's door"

for membership in the alliance as early as 2005.

But the idea of NATO membership could be merely a bargaining chip for

Georgia's negotiations with the Kremlin. Georgian diplomats acknowledge that

Tbilisi would be willing to abandon its bid for NATO membership if Russia

fulfills its promises to shut down its military bases and help Georgia

recover its lost territory in Abkhazia.

In official circles, it is insisted that Georgia is essentially a Western

nation. "Our values originated in Europe in the eighteenth century, in the

Enlightenment," Mr. Charkvian said.

*******