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Issue #120 | September 22, 2000 | ||||
Edited by David Johnson The CDI Russia Weekly is a weekly 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. To receive a free subscription, e-mail David Johnson at djohnson@cdi.org Contents CDI Russia Weekly-#120 22 September 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: Ex-dissident Solzhenitsyn hails former KGB spy Putin. 2. Moscow Times: Pavel Felgenhauer, DEFENSE DOSSIER: Chechnya: A Vicious Circle. 3. Interfax: SITUATION IN NORTH CAUCASUS CRITICAL - DUMA'S CHECHEN DEPUTY. 4. RFE/RL: Andrew Tully, Russia: Congressional Report -- Clinton Partly Responsible For Economic, Political Decline. 5. Itar-Tass: RUSSIAN GENERAL CRITICIZES PENTAGON FOR REFUSAL TO SHOW SUBS TO EXPERTS. 6. Christian Science Monitor: Scott Peterson and Fred Weir. Russia's glasnost questioned. Former President Mikhail Gorbachev is passionately defending freedom of the press. 7. Stratfor.com: Uneasy Partners: China and Russia. 8. EIRNS: PUSHKIN IN WASHINGTON. 9. Nezavisimaya Gazeta: Vladislav KUZMICHEV and Sergei PRAVOSUDOV, OIL SPELLS POLITICS. Russian Government Too Passive in Using This Axiomatic Truth in Its Dialogue with the West. 10. The Russia Journal: Alexander Golts, Full circle for military reform. Russia’s armed forces not only require cuts, they must be also be reformed. 11. World Bank: World Bank Confronts Poverty in Eastern Europe and Former Soviet Union—Launches new report, "Making Transition Work for Everyone: Poverty and Inequality in Europe and Central Asia." ****** #1 Ex-dissident Solzhenitsyn hails former KGB spy Putin MOSCOW, Sept 21 (AFP) - One-time dissident Alexander Solzhenitsyn hailed Thursday the "spirit" and "prudence" of Russian President Vladimir Putin, a former agent in the Soviet KGB which hounded the Nobel laureate into exile. "He has a fighting spirit, learns quickly and has no personal thirst for power," Solzhenitsyn said in an interview on state-run RTR television. "The president understands the enormous difficulties he has inherited. His extraordinary prudence and balanced judgement must be praised," added Solzhenitsyn. Such praise has been rare commodity recently for Putin, whose reputation as a tough, effective leader has been damaged by his sluggish response to the Kursk submarine disaster and a crackdown on media critics. The interview came the day after Putin, a former head of the FSB domestic intelligence agency (ex-KGB), discussed the state of Russia with the Nobel prize-winning author. Putin and his wife Lyudmilla spent more than two hours at the suburban Moscow home of the 81-year-old Solzhenitsyn and his spouse, the first such meeting between the two men. Television footage showed Putin presenting the Solzhenitsyns with a large bouquet after which he was shown round the library of the writer, whose works include "The Gulag Archipelago," a seminal work on the Soviet forced labour camp system. "Vladimir Vladimirovich (Putin) has telephoned Alexander Isayevich (Solzhenitsyn) two or three times to speak about the situation in Russia," Natalya Solzhenitsyn said. "The first was last November when he called after Alexander Isayevich gave a television interview," she added. The visit was all the more noteworthy as Solzhenitsyn, who won the Nobel prize for literature in 1970, has sharply attacked Putin for his failure to pull Russia out of the "ruins" into which it has fallen. The former inmate of Russia's notorious prison camp system also ticked off the president in March for granting his predecessor Boris Yeltsin immunity from prosecution. Solzhenitsyn branded the decision "shameful," telling the Moskovskiye Novosti weekly that Yeltsin should be hauled before a court to answer for his behaviour and that of the elite cabal of businessmen who exploited Russia's post-Soviet chaos to enrich themselves illegally. Much separates the two men. Solzhenitsyn, who had already spent eight years in prison camps, was expelled from the Soviet Union in 1974. A year later, a youthful Putin realised a boyhood dream and joined the KGB, joining a department responsible for cracking down on dissidents. However, they appear to share a common desire for Russia to rediscover its national greatness and undergo spiritual renewal. "The fact that one of them belonged to the KGB and that the other was a dissident is not an obstacle," said Gleb Pavlovsky, a Kremlin aide and political commentator. "They don't live in the past and have things to talk about," he said. But "I don't think that Putin sees Solzhenitsyn as his 'spiritual father' or 'mentor,'" he added. While many Russians respect Solzhenitsyn for his dissident past, some former supporters have been shocked by his rapprochement with Putin. "It's appalling. I can't believe Solzhenitsyn would have accepted such a thing," said Viktor Dzyadko, a former member of the Solzhenitsyn Fund for Political Prisoners active in the 1970s and 1980s. "Having the greatest respect for Solzhenitsyn and the worst opinion possible of Putin, I find it really difficult to explain this," added Alexander Podrabinek, another leading dissident of the 1970s. ****** #2 Moscow Times September 21, 2000 DEFENSE DOSSIER: Chechnya: A Vicious Circle By Pavel Felgenhauer After the tragic sinking of the Kursk nuclear submarine last month in the Barents Sea and the fire that gutted the Ostankino television tower, the most intriguing question for many Russians is: What major calamity is next? The most obvious answer: Chechnya. Officially, authorities have declared that the war in Chechnya has already ended and with a resounding victory for federal forces. But the facts on the ground do not support this claim. On the contrary, the rebellious North Caucasus republic, though occupied by federal troops, today seems ripe for a mass insurrection. Despite heavy attacks by federal forces, the Chechen resistance is still very much alive, while Russian military casualties continue to mount at alarming rates, with 20 to 30 dead each week and 60 to 90 wounded. The overall official toll of the "anti-terrorist operation" is roughly 2,700 Russians dead and 9,000 wounded. Unofficial casualty estimates run up to two times higher. Of course, our generals were trained in Soviet military academies to regard as "insignificant" casualties that are less than half of anygiven unit's manpower. And public opinion, doctored by pro-government propaganda, appears to accept the death toll in Chechnya with equanimity. Most Russians believe that "war is war," that mass death is inevitable. The nation's elite is even more complacent; its sons are not at the front. But how long will the present stalemate continue? It seems that federal authorities may soon face something more serious than just a low-level guerrilla campaign in Chechnya. Last week, it became obvious that the morale of federal troops and of the proxy pro-Moscow forces in Chechnya is beginning to crumble. As of June 1, the Finance Ministry virtually stopped providing additional financing for the war. The Finance Ministry is hoping to create a budget surplus and is using military proclamations of victory as a pretext for cutting funds. The Defense Ministry was instructed to pay for operations in Chechnya out of its regular budget allocations. Arrears are growing, and Russian soldiers who enlisted to fight in Chechnya to collect hefty combat pay f 800 rubles a day, or about $28, offered by the government last fall f are increasingly embittered at not being able to collect what they believe is due. At first, kontraktniki, Russian volunteers who have served in Chechnya, started protesting in Rostov-on-Don near the headquarters of the Northern Caucasus Military District, which is in charge of operations in Chechnya, and demanding to be paid. Last week, protests by enlisted men spread to the war zone: A soldier told an RTR television reporter in Znamenskoye, "All we think about is getting food and smokes. We're supposed to be on full allowances and pay here, but we get nothing at all. We're not even issued uniforms." The motley Russian force that invaded Chechnya a year ago was badly equipped, badly trained and undisciplined, but today it is increasingly turning into a true menace: Soldiers and officers not only randomly attack civilians and mistreat Chechen POWs, but have in fact established a regular racket of kidnapping Chechens as "terrorist suspects" for ransom, collecting bribes from anyone passing a checkpoint, and so on. By all accounts, the brutal federal occupation is the main source driving the resistance today. Last week, Akhmad Kadyrov, the Moscow-installed Chechen leader, accused federal troops of unprovoked attacks and warned authorities that the people's patience was wearing thin. When federal forces marched into Chechnya, they promised the population law and order, pensions for the old and jobs for the young. But nothing has materialized. Even pensions are not being paid; funds from Moscow have been allocated, but apparently they have been commandeered, most likely by local pro-Moscow authorities supported by the Russian military. Kadyrov's sudden protests of Russian brutality are hardly more than an impotent attempt to distance him from war crimes and rampant corruption, a protest that will change nothing. But most other Chechens don't seem to have any other option but to fight back. Mass protests in heavily armed Chechnya may easily turn into an overall insurrection. In retaliation, the Russian military will no doubt fully unleash its undisciplined force and commit more atrocities, which in turn will fuel more armed resistance. It seems the Kremlin has created a vicious circle of violence in Chechnya that has left it with no good options at all. Pavel Felgenhauer is an independent, Moscow-based defense analyst. ******* #3 SITUATION IN NORTH CAUCASUS CRITICAL - DUMA'S CHECHEN DEPUTY MOSCOW. Sept 21 (Interfax) - Chechen deputy to the State Duma Aslanbek Aslakhanov said at parliamentary hearings in the Duma on Thursday that the situation in the North Caucasus is critical. He sharply criticized the attitude of the federal authorities, the law- enforcement bodies and the armed forces towards the Chechens. "All imaginable experiments of cruelty, unscrupulousness and immorality are being made on the Chechens, who are facing grave trials in their republic," he said. Regarding the Chechens who have left Chechnya and live in other Russian regions, he said that they have fallen victim to "some turncoats wearing military uniforms" who have found "their own source of income planting drugs on Chechens, extorting money from them and sending them to prisons without any reasons." He said that his speech at the hearings is "a cry from the heart" and that he was particularly worried by relations between the Chechen population and the army. "There will be no peace until the armed forces turn to the citizens as say: We are with you," said Aslakhanov. The deputy stated that the people have been driven to despair. If the situation does not improve "both men and women would prefer to die," he said. The planet's population seems to have been brainwashed into seeing only 'genetic bandits' in the Chechens, he said. As a result, Chechens are not received abroad. Like the population of Kosovo, they have not been offered to leave the Russian territory. "Not a single foreign country has given [the Chechens] an opportunity to leave the country which has turned out to be their step-mother," Aslakhanov said. He criticized various foreign missions arriving in Chechnya to study the situation. "These missions look like leisure trips. They come today and leave tomorrow," he said. "The only thing they do is express their criticism of Russia. Such assistance does not suit us. If they did want to help the Chechen people, their assistance should have been more concrete," he said. Therefore, the Chechens do not trust anyone today, Aslakhanov said. He announced that he would make proposals on establishing strict control over the spending of resources allocated for Chechnya's economic rehabilitation. He said that against this alarming background "slow positive changes are taking place." ******* #4 Russia: Congressional Report -- Clinton Partly Responsible For Economic, Political Decline By Andrew F. Tully For years, U.S. President Bill Clinton's Republican Party opponents in Congress have been accusing him of conducting a poor policy toward Russia. Now they have issued a report -- less than seven weeks before America's general election -- that details their harshest criticisms. Clinton and some fellow Democrats respond by accusing the Republicans of merely playing partisan politics. RFE/RL correspondent Andrew F. Tully reports. Washington, 21 September 2000 (RFE/RL) -- A report by the U.S. Congress says President Bill Clinton is in large part to blame for the political and economic troubles that Russia has experienced in the past eight years, and that Russians distrust America more than at any time since the end of the Cold War. The 209-page report says the Clinton administration did not seize an opportunity to help Russia change from an adversary to a political and economic ally of America, just as the U.S. did with Germany and Japan after World War II. The report was commissioned by Congressman Dennis Hastert (R-Illinois), the speaker of the House of Representatives. Instead, the document said, Clinton threw vast amounts of money into Russia's central government and focused its attention on the country's central leaders -- particularly Boris Yeltsin and his inner circle -- and ignored members of the Duma, who have regional credentials. The commission's report also criticized the Clinton administration for maintaining relations with some Russian officials even after they were suspected of involvement in corrupt practices. The report paid particular attention to the country's former prime minister, Viktor Chernomyrdin, and Anatoly Chubais, the former finance minister who is now the head of Russia's electricity utility. Congressman Christopher Cox (R-California) -- the chairman of the panel that issued the report -- says that from the standpoint of America's self-interest, the U.S. may have lost the opportunity to have a powerful alliance with Russia. At a news conference where he released the report, Cox said: "They [Russian leaders] sought in their formal foreign policy -- in their foreign policy concept published in 1993 -- what they called a strategic partnership with the United States and a close alliance -- an alliance with the United States. That is no longer their aim. They have formally withdrawn that from their foreign policy concept this year. And one of the reasons is the loss of confidence in U.S. advice and the loss of respect for the U.S. position as identified by our association with corruption." State Department spokesman Richard Boucher responded to the report by saying the U.S. has successfully helped Russia reduce its nuclear arsenal, establish a civil and criminal legal system, and privatize 75 percent of its economy, among other things. "We would like to think that our [Clinton administration] contributions to building civil society, to helping entrepreneurs, to helping destroy nuclear weapons -- that these have been valuable not only to the development of Russia but also to the American people." Boucher said he would not address what he called the political aspects of the report. This already had been done by the White House and Clinton's political allies. The panel that drew up the report was composed entirely of members of the Republican Party. Clinton is a Democrat, as is his vice president, Al Gore, who hopes to be elected on November 7 as Clinton's successor. But during the nearly eight years of the Clinton administration, Gore has presided over U.S. policy toward Russia and the other nations of the former Soviet Union. He even serves as co-chairman of both the U.S.-Russia and U.S.-Ukraine Bilateral Commissions. These positions were supposed to have given him a foreign policy advantage in his run for the presidency. Instead, Gore's political opponents have used news of corruption in both Russia and Ukraine to attack him. On Tuesday -- the day before the report was released -- a group of Democrats in Congress suggested how important it views the report by writing a letter to Speaker Hastert denouncing the document as a partisan political exercise. White House Press Secretary Joe Lockhart said the same at a news briefing the same day. Cox rejected the notion that the report was politically motivated. The congressman pointed to the severe decline in the Russian economy over the past decade, and said the Clinton administration did little to help. In particular, he cited the decline in Russia's health care. He noted that most medicines -- imported into Russia from the West -- are too expensive for Russians and therefore are unavailable. This, he said, contributes to a deathrate in Russia that exceeds the country's birthrate. "These are horrible, bad facts that are not Democratic or Republican problems, they're American problems that we hope to attend to. And as the majority party in Congress, we have a policy that we are putting forward here." Christopher Arterton is dean of the Graduate School of Political Management at George Washington University. He says he has no doubt that the congressional report is political. "It sounds to me like the timing of this particular document is -- people certainly have an eye on the electoral clock." But Arterton stressed in an RFE/RL interview that the Democrats' reaction -- given before they had even read the report -- was equally politically motivated. "Of course the effort by partisans on the other side to say that this is pure politics is an effort to undercut the integrity of the report, or the legitimacy or the credibility of the report, and it in itself is a partisan act." Arterton said it is not always possible to draw a line between governing and running for office. He says members of Congress clearly have a right to point out what they honestly believe are the errors of their political opponents -- even if they run the risk of being accused of practicing partisanship. But that, Arterton added, is the very nature of a democracy, and it is up to the people to decide which politicians are acting in good faith. ****** #5 RUSSIAN GENERAL CRITICIZES PENTAGON FOR REFUSAL TO SHOW SUBS TO EXPERTS ITAR-TASS Moscow, 21st September: Col-Gen Valeriy Manilov, first deputy chief of the General Staff of the Russian armed forces, today criticized the Pentagon for its refusal to allow Russian specialists to inspect the US submarines that had been near the Kursk submarine disaster area in the Barents Sea. "Within the framework of the partnership relations that have been established between our two states, including relations in the military sphere, it would be correct for the USA to dispel out concerns and give the Russian side the opportunity to get exhaustive answers to the questions it has," he said. This would also meet the fundamental interests of cooperation and interaction between Russia and the USA, and of strategic stability, Valeriy Manilov added. As regards the genuine causes of the Kursk disaster, he [Manilov] believes that a single theory will take shape only after the submarine is lifted. "None of the theories can be ruled out at present," the general said. ****** #6 Christian Science Monitor September 21, 2000 Russia's glasnost questioned Former President Mikhail Gorbachev is passionately defending freedom of the press. By Scott Peterson and Fred Weir Staff writer of The Christian Science Monitor MOSCOW Freedom in the New Russia may have a price, and it can be a high one if you dare to criticize the Kremlin. Andrei Babitsky, a correspondent of the US-funded Radio Liberty discovered that earlier this year after being seized by Russian security police in Chechnya. He disappeared for weeks, after being "traded" to a mysterious group of armed men by his captors. Mr. Babitsky, presently under house arrest in Moscow, learned the hard way that the Russian government is often more concerned with a citizen's obedience than his constitutional rights. Now, Vladimir Gusinsky, owner of Russia's largest independent media empire, says the Kremlin has dealt him exactly the same lesson. Arrested and held in Moscow's Butrskaya prison last June on an accusation of fraud, Mr. Gusinsky was exonerated and allowed to leave the country after promising to sell Media-Most, which includes several newspapers, a radio station, and Russia's only nonstate television network NTV, to the state-owned natural-gas giant Gazprom. According to Segodnya, a newspaper owned by Media-Most, the deal contained a secret codicil signed by Gazprom and by government Press Minister Mikhail Lesin, which says if the agreement is broken, all parties are "freed of their obligation" to guarantee Gusinsky's physical safety. The text also implies that Gusinsky agreed not to make statements that would "discredit" state institutions. Mr. Lesin yesterday admitted that he had signed the secret pact, but told Russian state TV he did so as a "private person," not as a state official. "The state made a provocative proposal to Gusinsky: your freedom for your company," says Igor Dyakovsky, president of the Russian Union of Journalists. "This is a real illustration of the information policy of our government. The new doctrine means to introduce state control over the mass media." President Vladimir Putin has declared that his rule would be a "dictatorship of law." But details emerging about the high-stakes political game for control of NTV point to more brass-knuckle methods. "The use of the police forces to bring the media under state control is a throwback to the past," says Boris Altschuler, a human rights activist and member of the Moscow-Helsinki monitoring group. "It's the way of Lenin, not the way of democracy and law." On Monday, Gusinsky revealed the existence of the bargain and reneged on it, saying it was made "under pressure, you could say at gunpoint." Almost immediately Russian deputy prosecutor Vasily Kolmogorov announced the police would launch a new investigation and Gusinsky – who has been in exile in Spain since July – will probably be called in "for questioning." Former Soviet President Mikhail Gorbachev, who heads an NTV advisory body and who launched press freedom in the twilight of the Soviet era, called the secret deal "glaring testimony of blunt blackmail on the part of the state" and demanded a meeting with Mr. Putin to get an explanation. Alfred Koch, head of Gazprom's media business, says the company merely wants to recover some $473 million that was lent to Media-Most by Gazprom. He says Gusinsky has used his freedom to move assets abroad and try to find alternative solutions to his financial problems. Gazprom, Mr. Koch insists, is not interested in controlling the network on behalf of the Kremlin and might eventually sell Media-Most – estimated to be worth about $1.5 billion – to a third party, such as an American media group. That begs the question of why Gusinsky, owner of one of Russia's hottest media properties, hasn't been able to find an investor to bail him out of what is, in effect, a relatively small debt in the world of big media. "No Russian company will help Gusinsky. They all know what kind of trouble will fall on them from above if they get involved," says Vladimir Pribiulovsky, director of Panorama, an independent Moscow-based political consultancy. "Plenty of foreign companies could easily come up with the money to settle Media-Most's debt. But in the present political situation it would not be profitable. Maybe someone like George Soros would give the money, just as an investment in Russia's free press." In a recent interview on CNN, Putin said this case – and that of Boris Berezovsky, who was ordered to give up his 49 percent stake in ORT public television – "has nothing to do with attempts to strangle freedom of speech," and that "nobody is going to shut them down." But many see the secret deal as part of a campaign by the Kremlin to curb the wide-open and often exuberant media culture fathered by Mr. Gorbachev in the heady days of perestroika and glasnost, the policies that peacefully ended Communism in Russia. One of those is Gorbachev himself, who has passionately thrown himself into the defense of Media-Most's independence. "Mikhail Sergeyevich [Gorbachev] isn't doing this for Gusinsky or any narrow business interest," says Pavel Palaschenko, Gorbachev's long-time personal secretary and translator. "He is very worried about the fate of glasnost, which he began in this country. He fears this situation is a major threat to press freedom, and that's why he's become involved." Analysts say the Kremlin is not looking to restore Soviet-era control and censorship, but rather to set limits on access to the press and boundaries for criticism. Making sure that state-owned companies, like Gazprom, hold controlling stakes in major media is one way to enforce guidelines from backstage. "I don't think the Kremlin wants to shut down Media-Most, merely to 'regulate' it," says Andrei Zakharov, of the independent Foundation for the Development of Parliamentarianism in Russia. "With Putin, it is pragmatism that rules. That means flexibility, but pragmatism is just not compatible with moral principles. The pragmatic thing was to offer Gusinsky freedom for his shares." Last week the Kremlin Security Council released a new "information doctrine" that experts say codifies precisely this approach. "The thrust of the new doctrine is 'ideological security,' which implies control over all information that reaches the population," says Andrei Piontkovsky, director of the independent Center for Strategic Studies in Moscow. "The Kremlin will be the arbiter of which information is dangerous and which is safe." Russian tycoons like Vladimir Gusinsky and Boris Berezovsky built their empires in the wild 1990s, often through shady business methods and taking advantage of state largesse. "We should not believe that Gusinsky is just a fighter for free speech," says Sergei Mikhailov, of the Political Consulting Association at the Russian Public Politics Center. "Media-MOST is an empire, headed by an oligarch." Nevertheless, Media-Most has become a home for Russia's best professional journalists, some of whom are now threatening to resign. "If control over NTV would be established in this manner, I will not work for one minute with these racketeers and looters," says Yevgeny Kiselyov, one of Russia's best-known TV anchormen. ****** #7 Stratfor.com Uneasy Partners: China and Russia September 19, 2000 Summary The leader of China’s parliament, Li Peng, concludes a nine-day visit to Russia on Sept. 19. The visit was rife with talk of the “historic decision” of Russia and China to forge a “strategic partnership.” While the rhetoric suggests increased security cooperation, there appears to be little movement toward alliance. Rather, the substance of Li’s visit was energy and economic cooperation, as well as meeting with former Russian and Soviet, officials. Despite common interests, Beijing and Moscow remain wary partners. Analysis Li Peng, Chairman of the Standing Committee of China’s National People’s Congress, visited Russia Sept. 11-19. During the visit, Li met with several current and former Russian officials, extolling the importance of the strategic partnership forged between Moscow and Beijing. Rather than a trip to shore up a strategic alliance based on military cooperation, Li’s visit was to determine the status of Sino-Russian relations and press for greater economic cooperation, particularly in energy issues. Beyond the rhetoric aimed at the dominance of the United States, the relationship between the neighbors remains wary, as it has been since former Russian President Boris Yeltsin stepped down on Jan. 1. Upon arriving in Moscow, Li called the Sino-Russian strategic partnership a “historical choice” based on the “experience and lessons of the past taking due account of changes in the international situation after the end of the ‘cold war,’” according to ITAR-Tass. Li further used the opportunity to criticize the U.S. missile defense system plans, warning it was harmful to “other countries and the U.S.A. itself.” Russian President Vladimir Putin matched Li’s comments, saying Sino-Russian relations were “at their highest.” The two discussed joint opposition to the U.S. missile defense system and shared concerns of religious extremists in Central Asia, according to Interfax. Beyond the geopolitical rhetoric, however, stood the real substance of Li’s visit – assessing the state of relations under the new regime and increasing economic and energy cooperation. Li’s visit included meetings with former Russian and Soviet officials, during which he emphasized the importance of “old friends.” Li also visited Yeltsin, who assured him the new Russian leaders would follow the same strategic partnership established by earlier leaders, and enhanced by Yeltsin and Chinese President Jiang Zemin. Such assurances are important to Beijing, which was taken off guard by the regime change in Moscow. Russia’s initial diplomatic push to the West did little to enhance Beijing’s confidence. Just three months ago Li visited six countries located either within or on the edge of the former Soviet empire – Azerbaijan, Croatia, Slovakia, Slovenia, Ukraine and Yugoslavia – while conspicuously skipping a stop in Moscow. Since then, Russia has shifted its diplomatic strategy eastward. Russia’s re-engagement with Asia and China has Beijing concerned. Both nations, however, share strategic interests in Asia, particularly in Central Asia and the Koreas. Li’s trip was also intended to press for increased energy and economic cooperation. China is seeking access to Russia’s natural gas and oil reserves to fulfill its shortfall in domestic reserves. Li also visited Russia’s Unified Energy System (UES) to seek advice for a similar Chinese system of energy distribution once the Three Gorges Dam hydroelectric project comes on line. Beijing is also looking to boost bilateral trade with Russia, which currently stands at $6 billion. The emphasis on economic and energy cooperation over strategic or military concerns was demonstrated during Li’s visit to the Russian Far East. Li was scheduled Sept. 18 to visit the Varyag, a guided missile cruiser of Russia’s Pacific Fleet based in Vladivostok. This was reported both in the Russian and Chinese official press. Li unexpectedly canceled the visit at the last minute, with his press secretary unable to give Russian media the reason. Li’s visit was not entirely without strategic significance. It still serves Moscow and Beijing to back one another in international opposition to U.S. missile defense plans and to cooperate in dealing with Central Asian separatism and terrorism. In broader terms, however, the two nations remain competitors, for space, access to Central Asian energy reserves and international investment. China’s imminent entry into the World Trade Organization only exacerbates this competition. Given the changing of guard in Russia, Li’s mission was to reassess the state of relations between Moscow and Beijing. Many of those Li visited in Moscow were former officials, some from the Soviet era. At the same time, Li promoted development opportunities in China’s west and sought to increase economic and energy ties. Nearly all his discussions in Siberia, the Far East and even in Moscow emphasized energy and economy while only touching on security issues in his introductory speeches. While Russia serves as a sounding board for the Chinese government, Beijing does not want to alienate the West – particularly the United States – as it seeks entry into the World Trade Organization. Beijing remains wary of Russia’s new leadership, and will pursue economic and energy ties significantly harder than a military partnership. ******* #8 PUSHKIN IN WASHINGTON WASHINGTON, DC, Sept. 20 (EIRNS)-- The first monument in the United States to the great Russian poet Alexander Sergeyevich Pushkin was unveiled this morning, at a ceremony addressed by Russian Foreign Minister Igor Ivanov and U.S. Deputy Secretary of State Strobe Talbott. The Hon. James W. Symington, Chairman of the Board of Directors of the American-Russian Cultural Cooperation Foundation, presided over the culmination of this project, which his organization helped to initiate. A mock-up of the monument was presented last year, at the time of the bicentennial of Pushkin's birth. Several hundred people gathered on a street corner at the George Washington University, to see the larger-than-life bronze sculpture by Alexander and Igor Bourganov be unwrapped, in bright sunshine. It now stands at 22nd and H Streets. Students, professors, diplomats, Americans, Russians, Russian-Americans were beaming, as speakers recited and sang Pushkin's verses, and the formal messages rose to a level far higher than most international discourse. Rep. Symington read out loud a warm message from President Bill Clinton, welcoming the likeness of "this beloved poet" onto American soil. A message of greetings from Russian President Vladimir Putin (whom a translator, carried away by the moment, called "President Pushkin") was read aloud by Foreign Minister Ivanov. "From the bottom of my heart," Putin wrote, "I greet the organizers and all the participants of the solemn opening ceremony for the monument to A.S. Pushkin, the first one in the United States. This event, without exaggeration, may be considered not only a signal one, but really the most important in the history of the development of cultural ties between our countries. The Russian genius of Pushkin is open to the entire world, and his immortal creations, translated into dozens of languages, are among the greatest treasures of humanity. His creative work belongs to Russia as a nation. But, far beyond the borders of our country, millions of people highly value this great poet for his incorruptible fidelity to the ideals of beauty, freedom, patriotism, and morality." Citing Pushkin's "Ya pamyatnik vozdvig..." ("A monument I've raised..."), Putin concluded, "The main Pushkin monument is that one not made by human hands, which is raised in the hearts of those who love his marvelous verses, his easy prose, grand dramas, witty letters, and mischievous drawings. Pushkin always dreamed about travelling to far-off countries, but the poet was not destined to see the New World. Today, thanks to the efforts of true admirers of his talent, America's map now has its `Pushkin places.' I believe that also `the people's path' will never be overgrown, to this monument to the poet, whose art remains young in the twenty-first century, two hundred years after his birth. I sincerely wish all the true friends of Pushkin in America--peace, prosperity, and every success." The Washington Pushkin monument is a gift from the City Government of Moscow, to the city of Washington, DC. Greetings from Moscow Mayor Yuri Luzhkov were presented by his first deputy, Lyudmila Shvetsova. Beverly Rivers, Secretary of the District of Columbia, spoke on behalf of DC Mayor Anthony Williams. She noted the high interest among African- Americans, in Pushkin's being of African extraction. Deputy Secretary Talbott introduced Foreign Minister Ivanov, who added his own comments to those of President Putin. Noting that Pushkin was also a diplomat, being employed by the Russian Foreign Ministry, he said that Pushkin's arrival in Washington, DC, means that "we have another messenger of good will," to help in the difficult task of improving Russian-American relations. (After the ceremony, Ivanov was mobbed by reporters, seeking his reaction to the "Cox Report", issued by Congressional Republicans to denounce U.S. policy toward Russia under the Clinton Administration; he replied that he had not studied the report, although he had met some of its authors, and commented diplomatically, that while perhaps less has been achieved in U.S.-Russian relations during that past ten years that might have been hoped, still there has been progress in eliminating each other as enemy image, and stabilizing the relationship.) Other speakers were Yevgeni Bogatyrev, director of the State Pushkin Museum in Moscow, Prof. Peter Rollberg of the George Washington University, and Father Dmitri Grigorieff, Dean Emeritus of St. Nicholas Cathedral, who blessed the monument. Rep. Symington sang his trademark song--a verse from Mikhail Glinka's setting of Pushkin's "Ya pomyu chudnoye mgnoveniye" ("I remember the wondrous moment..."). Prof. Rollberg recited in Russian and in English, Pushkin's blistering sonnet "To the Poet", the poem where Pushkin advises that if the {vox populi} is foolish and infantile, ignore it! In the Bourganovs' bronze statue, Pushkin is wearing a frock coat, and steps forward from a column, as if about to recite. Atop the column is Pegasus, the winged horse of the poets. Champagne was passed through the crowd, and toasts were drunk to Pushkin. ****** #9 Nezavisimaya Gazeta September 21, 2000 [translation from RIA Novosti for personal use only] OIL SPELLS POLITICS Russian Government Too Passive in Using This Axiomatic Truth in Its Dialogue with the West By Vladislav KUZMICHEV, Sergei PRAVOSUDOV The news coming from the international oil markets on September 20 were very encouraging for the Russian economy. The global oil price had hit a record high. Panic in the importer nations could not have been ameliorated even by OPEC representatives' announced resolution to raise the production of hydrocarbons soon - the latest reports of declining oil reserves in the US had proven to be stronger and the oil price soared. But - there is always a but - however beneficial the high oil price could be for the Russian federal budget, it looks as if it is too early to speak of an onset of economic stability in Russia. It is only natural that sooner or later the oil price will stop growing and start gradually declining. Meanwhile, the Kremlin and the government are doing a precious little to enhance the country's economic might and reinforce its international standing, something that would expand markets for Russian products. The oil price has cleared the 30-dollar per barrel threshold on several occasions in the course of a year, but thus far Russia has failed to finalize its negotiations with the Paris Club on its debts to be paid back in 1999 and 2000, let alone other comprehensive agreements. Russia is being ousted from all spheres of traditional influence: not only the Balkans, but also Transcaucasia, the Baltic and Ukraine, where the West's influence is on the rise. Eastern Europe is another graphic example. One gets the impression that the Russian authorities have been concentrating on domestic politics - a bit too much so. Examples to illustrate the point: the scandals around the Media-Most Holding, a de-facto reform of the Federation Council, and muscle flexing in relations with oligarchs. The Kremlin may have added to its political weight, but the flight of capitals from the country is continuing, and even growing. Experts promise that the amount of money spirited off from Russia before the end of this year will be a quarter larger than last year. The country's industries are meanwhile pining to be updated, something that necessitates appreciable outlays. When still running for the presidency, Vladimir Putin announced his intention to transform Russia's foreign policy. To remind: the country's economic, rather than political, interests were intended to be announced priority. One gets the impression that this noble intention is yet to be realized. Russia's stance on Iraq is illustrative: cynically as it may sound, if sanctions against that Arab state are lifted, the Russian economy is bound to suffer - when Iraq's oil starts flowing into the international markets, its price is apt to go down. Russia is a case apart: it is a member of the world's industrialized nations club, on the one hand, and a major exporter of oil, on the other hand, accounting as it is for more than 10% of the international oil market. On the contrary, the US and the EC states produce effectively no oil and rely on imports to meet their domestic requirements for fuel. The Russian government cannot guarantee an instant increase in oil exports to the West - Russian pipelines' through capacity is 120 million tons a year and they are working at full capacity as they are. But some projects not involving pipelines pumping oil to Europe can facilitate Russian oil exports in the medium-term perspective. This circumstance can certainly buttress Russia's standing in its dialogue with the West. For the first time in the past decade, Russia can alter the "senior-junior" relations with the West to be those of equals, with some reservations, naturally. Russia used to ask for money to effect structural reforms and simultaneously pressed for a rescheduling of payments while insisting it had no money to pay. As a result, the West would cough up another credit in exchange for certain political concessions, something that enabled the 'patriotic' opposition to accuse the ruling regime of betraying Russia's national interests. Now that the Russian authorities have no more need for new credits, they can press, as equals, for beneficial treatment in international trade and thus support the domestic producer. This circumstance seems instrumental for the Russian economy, for the domestic demand for domestic products is limited by the low incomes of the bulk of the population. Nobody would venture to offer a forecast of how long the high oil price will persist. OPEC cannot raise the volume of its exports to drive the oil price down - not overnight. But if the Russian authorities fail to use the next few months - twelve to eighteen months at the most - to reinforce their economic and foreign political stance, the nascent oil price plunge may destroy the precious little that Russian companies have achieved since the 1998 default. The '2003 problem' would then exceed the limits of the abstract notion of 'idling production capabilities' to trigger, in combination with the burden of Russia's foreign debt (that will reach its pinnacle in 2003-4), an economic crisis of such a scale that the August 17 meltdown would seem to be a prank of the 'young reformers.' ******* #10 The Russia Journal September 16-22, 2000 Full circle for military reform By ALEXANDER GOLTS Russia’s armed forces not only require cuts, they must be also be reformed. RUSSIA IS LOOKING to cut its military forces by 350,000 troops while increasing spending by nearly 50%. After a decade of hesitation, the country’s political and military leaders have decided to get serious about reforming the military. Defense Minister Igor Sergeyev announced that the armed forces were to be cut by 350,000 troops. At the same time, members of the State Duma lower house of parliament defense committee said that President Vladimir Putin has already ordered defense spending to be increased, not by a third – to 206 billion rubles – as the government had proposed, but by almost half – to 271 billion rubles. If the size of the armed forces is cut and spending is increased, this ought to make for a better-quality army. This is exactly what many people with common sense have been pushing for over recent years. But there is no guarantee that this new reform will make the Army "compact and efficient," as Putin recently said. Indeed, there is serious cause to suspect that this latest attempt at reform won’t bring any results at all. Just as the details of the proposed reforms made their way into the press, news appeared of a directive from the head of General Headquarters stating that military-space forces were to be taken out of the strategic missile forces. This looks like a mundane bureaucratic decision, but it suggests that the latest reforms may end in failure, just as previous ones have done. Previous reforms have all started with this same point – putting the military-space forces under the command of a different branch. The first thing Igor Sergeyev did in 1997 when named defense minister was to bring the military-space forces into the strategic missile forces. At that time, the merger caused a great scandal. Almost the whole command of the military-space forces handed in their resignation. But Sergeyev and his people proved that the painful change had to be made. They said that this would do away with redundant dual-command maintenance, and even security, systems that had been put in place at the same bases, testing grounds and space launch centers. Both the strategic missile forces and the space forces were using the same rockets and guiding systems. Sergeyev’s arguments sounded logical enough, and the next three years proved the wisdom of his decision. With the support of the material and scientific potential of the strategic missile forces, the space forces have been able to launch military satellites and even carry out successful commercial programs. Strategic missiles that had become outdated as weapons were used to launch foreign clients’ satellites. But now things are to be changed again. Only this time, the space forces have been placed under the command of General Headquarters. The only argument the General Headquarters men could find to explain their decision was that the money received from commercial launches went solely into producing new strategic Topol-M missiles. In reality, Head of General Headquarters Anatoly Kvashnin is itching to get revenge on the missile forces, which he considers as his main enemy and obstacle between himself and the defense minister’s job. This whole story demonstrates more than the fact that military reform has gone full circle, returning to where it began in 1997. It shows that the problem is not only a serious lack of money, but also a lack of even the smallest hint of professional ethics. The same high-ranking officers who put the space forces under the command of the strategic missile forces now are moving them to the command of General Headquarters. These are people who can find reasons to justify whatever their bosses ask of them. But these are the same people also responsible for implementing military reform. There’s no guarantee that the proposed figures for cutbacks – 180,000 for ground forces, 50,000 for the navy and 40, 000 for the Air Force – were arrived at through serious calculations rather than vicious bureaucratic battles. There’s even less chance that, given this situation, the other "security ministries" will take General Headquarters’ calculations for cutbacks to the interior ministry’s border and railways forces seriosly . The other problem is that none of the generals will risk telling Putin that, as long as he keeps the conscript system in place, there is no amount of extra money that will make a modern army. The two years that yesterday’s school kids spend in the garrisons won’t make them into real soldiers who can use modern military technology effectively. But keeping the conscript system in place is the only way to justify maintaining the armed forces’ current abnormal structure, where there are more colonels than lieutenants. A conscript army, even if its numbers are cut back, will always lack money, as will Russian military bosses. ****** #11 Excerpt World Bank World Bank Confronts Poverty in Eastern Europe and Former Soviet Union—Launches new report, "Making Transition Work for Everyone: Poverty and Inequality in Europe and Central Asia" September 20, 2000—The transition countries of Europe and Central Asia have experienced a sharp increase in poverty, and inequality has also increased in some Commonwealth of Independent States (CIS) countries, says the World Bank in a report released Tuesday in Prague. Making Transition Work for Everyone: Poverty and Inequality in Europe and Central Asia reports on the latest findings on the nature and evolution of poverty and inequality in the region, based on recent household survey data and interviews with the poor. It also considers policy actions needed to reduce poverty and create more inclusive societies. "Drawing heavily on the framework of promoting opportunities, facilitating empowerment, and enhancing security, Making Transition Work for Everyone: Poverty and Inequality in Europe and Central Asia focuses on specific challenges facing the transition countries. It is an important contribution to our ongoing reflections about how we at the World Bank can work most productively with our clients and partners to reduce poverty", writes Johannes Linn, World Bank Vice President for the Europe and Central Asia Region, in the report’s foreword. When transition began in the Europe and Central Asia region, many thought the increase in poverty would be shallow and short-lived. But the dramatic increase in poverty from 2 percent in 1988 to 21 percent in 1998 is much larger and more persistent than many expected. A key explanatory factor for this unprecedented rise in poverty was the huge economic collapse that accompanied the initial years of transition: the CIS countries registered a cumulative output decline of almost 50 percent, while the Central European, South Eastern Europe, and Baltic countries experienced a smaller decline of about 15 percent. Poverty rates—based on the $2 a day poverty line ($2.15 per day in 1996 purchasing power parity terms) commonly used by the World Bank for international comparisons—vary dramatically across the region. Most of the people in the poorest Central Asian countriesTajikistan and the Kyrgyz Republic live on less than this amount, compared with 19 percent of Russians. Few people in the Central European nations of Hungary, Poland, and the Czech and Slovak Republics live below this poverty line. The study finds that by and large the elderly and pensioners are better off than families with many children. In Central Europe, pension schemes have generally done a reasonable job in protecting the elderly, but these programs have been less effective in the Caucasus and Central Asia. Rural areas tend to be much poorer than urban areas, especially in Central Europe. Nonetheless, due to high rates of urbanization, the majority of the poor live in urban areas in many countries. And while the unemployed are at high risk of poverty, many of the poor come from households whose members work. Educational and health services are under threat, particularly for the poor. In some of the poorest countries of the region, poor children are not attending school—they are likely to drop out or attend sporadically because of the costs of clothing, textbooks, and transportation. The very poorest families also depend on their children's labor. Under the table payments in the health and education sectors are rampant. The poor can least afford to pay, and thus have reduced access to essential services. Disturbing health problems, such as the decrease in male life expectancy, the resurgence of tuberculosis, a drastic increase in sexually transmitted diseases, the looming threat of an HIV/AIDS epidemic, and an increase in nutritional deficiencies are surfacing. And evidence from the latest International Adult Literacy Survey reveals that, in some countries of the region, adults lack the educational skills they need to contribute effectively to the emerging market economies. The impact of the economic collapse on poverty has also been accentuated by the large increase in inequality during the transition. The Gini coefficient—a common measure of inequality—increased by more than 50 percent in a number of CIS countries, and by 80 percent in Russia. In contrast, the increase was far smaller in Central European countries. Inequality in many Central European countries is similar to that of the Scandinavian and Northern European countries, while many CIS countries are approaching levels of inequality seen in Latin America. The report identifies a number of factors that contributed to the economic collapse and rise of inequality. The biggest declines have occurred in countries that initially had the largest macro-economic imbalances, were most over-industrialized, had the least previous experience with market institutions, and implemented only limited reforms in a less effective way. Incomplete market reforms, high levels of bureaucratic corruption, and the capture of national governments by powerful business elites also account for some of the differences in poverty and inequality outcomes among countries.... ******* |
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