April 11, 2001 

This Date's Issues:   5196 • 5197  

Johnson's Russia List
#5196
11 April 2001
davidjohnson@erols.com

[Note from David Johnson:
1. BBC Monitoring: Russian radio comments on centre right party's unwillingness to support NTV.
2. AFP: Russian liberals follow in Lenin's footsteps with London party.
3. RFE/RL: Andrew Tully, Russia: Bush Attaches Strings To Aid.
4. Kathleen Crane: Re: 5194-Bogus Greens.
5. Laura Belin: good commentary on NTV.
6. Jerry F. Hough: Re: 5195-Chubais and  NTV.
7. David Price: On NTV: Ray Finch in JRL5195.
8. strana.ru: Gorbachev, Titov to pool parties.
9. Slate.com: Anne Applebaum, I Want My NTV!
10. Moscow Time:  Yulia Latynina, How Kokh Should Have Taken NTV.
11. Moscow Times: Igor Semenenko, London Feels for Russia's Economic Pulse.
12. RFE/RL: Sophie Lambroschini, Twist In Swiss Justice May Work In Borodin's Favor.
13. Rossiyskaya Gazeta: US Administration Shows 'Sensible Restraint and Flexibility' Over EP-3 Incident.
14. strana.ru: U.S. agents try to recruit Russian hacker to get into FSB computer network.
15. Itar-Tass: About 15,500 Chechen rebels killed since August 1999.
16. UPI: EU blasts Russia over nuke cleanup.]  

*******

#1
BBC Monitoring
Russian radio comments on centre right party's unwillingness to support NTV
Source: Ekho Moskvy radio, Moscow, in Russian 0220 gmt 10 Apr 01

The leading Russian independent radio station - Ekho Moskvy - has suggested
in a commentary that the centre-right Union of Right Forces party has toned
down its support for independent NTV for fear of a backlash from the
Kremlin. The following is the text of the commentary, broadcast by Russian
Ekho Moskvy radio on 10 April:

It has become usual when a conflict arises for [Russian President Vladimir]
Putin to make a very long pause and then find an indirect method of
delivering his point of view to society.

[Soviet ex-president] Mikhail Gorbachev met Putin early in the morning on
Monday [9 April] and then retold Putin's considerations concerning NTV
events.

He first of all said that a court should give a clear answer as regards
what is happening to NTV. The court should give this answer to society and
the company's staff. The trial should be initiated by NTV's staff. A court
of a high instance should make a decision as regards the legitimacy of the
shareholder meeting that took place on 3 April. After this decision is
made, a new shareholder meeting should take place.

Third, the financial aspect should be separated from the creative one.
Fourth, it is inadmissible to lose the channel and the staff. The current
situation - rallies and a stir among the staff - is inadmissible.

This form of rendering Putin's words that has been allowed by Putin gives
him a chance to escape - to say that he was misunderstood, misquoted, and
his words were used in a wrong context. If this is not the case, then Putin
has said what thousands of people around the country demanded [during
rallies] last weekend.

Thank you, Your Lordship. Gazprom people are smart, their ears wide open.
[Gazprom-Media head Alfred] Kokh first discovered the unwillingness of the
Union of Right Forces to protect NTV from gunfire with its own body. Then
he received a message from [Russian Unified Energy System power grid head
Anatoliy] Chubays, who said that shareholders could have applied force but
did not do that. After he discovered and understood this, he said in
[Russia TV's] Zerkalo [programme] on Monday - and here is a quote - that if
the talks were not dynamic enough, then we will have to think about more
serious things.

It is interesting to ask what forced the Union of Right Forces to step
back. They were among the organizers of the [Moscow] rally that took place
a week ago, so what has happened? I think there are several reasons. First,
there cannot be too much Union of Right Forces when there is a lot of
Yabloko. Second, defending NTV, which is seen as the same as defending
[media tycoon Vladimir] Gusinskiy by many in the Kremlin, is bad for
ratings. It will not help during the possible early parliamentary election
this autumn. It will not provide an additional administrative impetus and
it will not further the dialogue with [presidential administration head
Aleksandr] Voloshin.

The members of the Union consider themselves to be good mathematicians. At
the end of 1999 Chubays said that a revival of the Russian army was under
way in Chechnya. Immediately the union received eight per cent during the
parliamentary election. The rallies are creating a threat that they [the
authorities] might give them less than five per cent next time. That would
spell trouble.

Third, Alik Kokh is one of them - together they escaped from so many mazes,
walked so many miles and did so many things. He is like an old jacket your
body is used to. Putin's signal transmitted via Gorbachev will cause some
confusion among liberal mathematicians. Maybe this confusion will cause
them to remember [human rights activist Andrey] Sakharov's imperative: If
you do not know how to behave, behave according to your conscience. That
is, if the latter has not been damaged by mathematics, of course.

******

#2
Russian liberals follow in Lenin's footsteps with London party

LONDON, April 10 (AFP) -
Lenin is hardly their ideological mentor, but a group of Russian liberals
followed in his footsteps on Tuesday by choosing London as the launchpad for
a foreign branch of their political party.

The Union of Rightist Forces (SPS), led by former deputy prime minister Boris
Nemtsov, became the first Russian party of modern times to open a permanent
London representation, arguing that votes among the sizeable Russian diaspora
would be crucial in future elections.

"Until this time Russian citizens who live abroad could not fully participate
in the political life of Russia," said Nemtsov. "Our party wants to get rid
of this injustice.

"Here in Britain we want to work out all the technical aspects for the SPS
abroad," he told journalists on the sidelines of a two-day Russian economic
forum in London. "The next city is New York."

With somewhere between 40,000 and 200,000 Russians living in Britain -- and
up to two million living abroad elsewhere in the world, the SPS believes the
expatriate community could prove a fertile electoral soil.

The party gained 29 seats in 1999 elections to the 450-seat State Duma, but
believes that liberal expatriates could dramatically swell the five million
votes it won during that poll.

"Our main aim is to get our people living here to vote," said Vladimir
Kara-Murza, who will chair the London branch of the party, to be known as the
Russian Democracy Council. "People who live here can have a real influence on
the elections. This is not a joke. We are here for real and here to stay."

The move was not entirely unprecedented, Kara-Murza noted wrily. Former
Soviet leader Vladimir Lenin's Bolshevik party sprang out of a notorious 1903
London meeting in which the All-Russian Social Democratic Party split in two.

But the similarities ended there, he said.

"Today the SPS has become a pioneer," Kara-Murza said. "For the first time in
modern Russian history at least, a Russian political party is taking up
foreign activity."

The party unusually has the backing of all three mainstream British political
parties. Conservative MP Dr Michael Clark, chairman of the British-Russian
parliamentary group, hailed the move.

"The Russian centre-right union stands for democracy, freedom of speech,
liberal approach to business and trade," he said. "In my view, the
centre-right way is the right way for Russia."

*******

#3
Russia: Bush Attaches Strings To Aid
By Andrew F. Tully

Washington, 10 April 2001 (RFE/RL) -- U.S. President George W. Bush would
impose conditions on aid to Russia, according to the details of his proposal
for federal government spending next year.

The $1.96 trillion budget proposal, issued today in Washington, would set
aside $808 million for the former Soviet states, including Russia, and $610
million for Eastern European countries, including the Baltic and Balkan
states.

The $808 million for the former Soviet republics matches the amount set aside
during the current fiscal year. But aid to Eastern Europe is $263 million
less than was set aside for the region this year.

The spending plan for the 2002 fiscal year -- which begins on 1 October -- is
subject to approval by Congress.

Bush's proposal left it up to Congress to decide exactly how much of the
money for the former Soviet states should be spent on Russia. But it stressed
that 60 percent of that figure would be withheld if the president believes
Moscow has not stopped helping Iran develop a nuclear reactor and a
ballistic-missile program.

According to the document, Russia also would have to cooperate with
international groups investigating reported war crimes and atrocities in
Chechnya, and with non-governmental organizations trying to help people
displaced by the fighting in the breakaway republic.

Another specific amount that Bush has suggested for Russia is $20 million
which should be set aside for the Russian Far East. And it proposes $45
million to promote child survival, a cleaner environment, and generally
promoting improved health in Russia.

Meanwhile, Bush's plan would give at least $170 million to Ukraine in 2002 --
$5 million less than the amount appropriated during the current fiscal year.
At least $25 million of the amount proposed for fiscal 2002 would be set
aside for nuclear-reactor safety, and a $5 million would be devoted to the
Ukraine Land and Resources Management Center.

Another former Soviet republic singled out is Georgia, which would get $92
million in aid from the U.S., including at least $25 million for border
security. And Armenia would receive a grant of at least $90 million. There
were no further details.

Meanwhile, the spending for Eastern Europe would include at least $5 million
for the Baltic states, at least $1.3 million for Kosovo, and no more than $80
million for Bosnia.

But Bush's proposal said aid for Bosnia's economic revitalization would be
withheld if the government in Sarajevo, among other things, has not ended
intelligence cooperation with Iran.

*******

#4
From: kcrane@tidalwave.net (Kathleen Crane)
Subject: Re: 5194-Bogus Greens
Date: Tue, 10 Apr 2001

In response to the Johnson List #5194 "Bogus Greens"  I would like to
comment about the Gazeta.ru article.  Although I have a very high regard
for Greenpeace and its activities to promote a healthy environment,
Greenpeace is by no means the only Green organization in the world.  There
are many diverging opinions about ways to actually solve existing waste
problems.  Some organizations realize that without an international
(including Russian) oversite committee that strictly distributes funds for
the import of spent nuclear fuel, and redistributes the funds to
environmental issues and humanitarian funds, then all incoming funds will
simply be stolen and no advances will be made to clean up and store  the
existing waste that severly contaminates Russia today.  What is an
alternative?  Somehow storage facilities must be made to the highest
standards to deal with the deadly materials.  Without funds these storage
facilities will not be built nor properly maintained and this is one of the
worst legacies of the governing bodies left over "and ongoing" from the
former Soviet Union.  Here is an opportunity to actually do something about
the mounting problems.

I see of course there are many uncertainties, considering safe shipments,
safe monitering and safe structures to house and store the waste... but
without the funds from outside, I would like to to see some other proposals
that provide some means to actually clean up the deadly waste in Russia
today. For many years I was opposed to just this idea of the international
shipment of waste to Russia because I knew that the emotions of the Russian
population would be so vehemently opposed.  However, I think that without a
well controlled program that monitors and distributes funds through trusts,
then imports will occur anyway, and in a way which will be illegal and
funds outrightly stolen, only to hurt the Russian people even more.
Because of  my realization of present day graft in Russia, I am being
persuaded that if we attempt no international nuclear waste storage
program, then the world will be a much more dangerous world... and
especially it will be Russia who will suffer the most.

I send my comments as an environmentalist, a geophysicist, a mother of a
Russian/American child and on behalf of my brother who died of leukemia.

******

#5
Date: Tue, 10 Apr 2001
From: laurabelin@excite.com (Laura Belin)
Subject: good commentary on NTV

Dear David,

If you can stand another piece on the NTV controversy, I would like to
recommend to JRL readers a commentary recently published by the Moscow Media
Law and Policy Center. It covers an angle I have not seen mentioned much in
recent media coverage.

The commentary considers the eleventh-hour move by NTV journalists to adopt
a charter for the editorial collective on 31 March, when the takeover by
Gazprom was imminent. It points out that by not adopting a charter years
ago, NTV journalists not only placed the network in violation of Russia's
1992 media law, but also greatly weakened the journalists' legal position
vis-a-vis the network's shareholders.

Among other things, a charter would have outlined procedures for hiring and
dismissing the editor-in-chief (a major bone of contention now). It could
also have strengthened the editorial staff's demands that shareholders not
interfere in editorial policy.

Of course, there is no guarantee that Gazprom and its proxies would have
honored the terms of such a charter. But as the commentary points out, a
charter would have bolstered the journalists' legal arguments in any court
battle (not to mention their bargaining position in any negotiations with
Kokh and Jordan). 

For those who read Russian and are interested in more details, the
commentary can be found at:
http://www.medialaw.ru/publications/zip/80/ch1.htm

Incidentally, Russian media watchers can find a vast array of commentaries
and publications about various legal issues on the Moscow Media Law and
Policy Center's website (www.medialaw.ru).

Yours,
Laura Belin
St. Antony's College, Oxford

*******

#6
Date: Tue, 10 Apr 2001
From: "Jerry F. Hough" <jhough@duke.edu>
Subject: Re: 5195-Chubais and  NTV

It is touching that Chubais defends Gazprom.   It is not
emphasized enough who Kokh is.   He was Chubais' number one assistant in
the privatization program, one of those who got into trouble with the fake
book deal that most took for a simple bribe.   Several of my oldest
closest old friends in Russia say that Putin is different and will
introduce real reform.   It would be reassuring to see some change in
personnel other than an attack on Luzhkov and his man Guzinsky.  
Whether the head of the family still has power--in the way that the
Chinese president hopes to retain it in China--or not, one certainly
has seen little convincing evidence of a change in the family as a
whole or in the way they function.      

*******

#7
Date: Tue, 10 Apr 2001
From: David Price <Bron@compuserve.com>
Subject: On NTV: Ray Finch in JRL5195

The European reaction to the NTV/ Gazprom fiasco is extremely critical as
an indicator of the state and health of  European/Russia relations. Gazprom
presently rates 40 per cent of the European Union's gas  imports and this
is increasing rapidly in absolute energy terms. The trade relation is of a
monopoly Russian supplier and a monopsony (single buyer grouping). Germany
(Mr Putin's area of expertise) takes in a great amount of Russian gas.

Gas politics are a longtime part of Russian foreign policy. See Financial
Times 9 April on its effect in reversing Georgia's pro-Nato policy and
other examples. The relationship of Gazprom, the world's largest gas
company, (previously called 'a state within a state' and now under state
control) to  freedom of the press and hence democracy is now at a critical
point.

However Europe does not have to give in to the cynicism of economic
blackmail that is indicated in Ray Flinch's piece. There is ample political
possibilites for the EU and the USA to use the opportunity on gas and
energy sales in the opposite direction. Depending on political choices, it
can make a highly positive contribution to peace,  growth, even
environmental renewal. It can help to reinforce Russian democracy, and
create highly beneficial economic reconstruction across the whole of the
European continent. A monopoly/monopsony relationship hardly responds to a
free market nor democracy. It needs democratic modification and a better
means for investing in a common future. The dangers and opportunities are
described on the website: www.schuman.org and in my books, "Russia and the
danger for the European Union" and 'New Cold War or Common European Home?'
summarized there.   
 
The positive opportunities arise both for business, for democracy, law and
order and freedom of the press by following the example of the European
Coal and Steel Community, the nucleus organization of the present European
Union. The EU is now an economic power the size of the USA.  The European
Community first provided an international anti-cartel system, European
democracy and economic management for free trade, and open, strategic
planning. The EC law system stabilized German democracy, constitutionalism
and reinforced European solidarity in ways far beyond the steel and coal
energy sector.

The result is that the six founder nation states (Germany, France, Italy
and the Benelux) have now notched up a period of peace longer than any
other in the entire history of the area. (2000+ years!). The conciliatory
European system introduced by Robert Schuman has replaced seemingly
intractable cycles of rivalry and war. It creates non-zero sum, highly
beneficial solutions.  Positive side-effects of the Schuman Community
system include increased economic growth (because long-term planning is
possible), elimination of national corruption because an opening of dubious
practice to European investigation was mandatory and a European court
system reinforced human rights, capital and business freedom.

Schuman spoke of this 'European home' in the 1950s and it included all the
European countries as far as Russia. This new type of synergy is now
possible from Spain to Russia. But it takes a high level of political
realism and honesty (in relation to present problems) willingness to make
the political preparation and political courage to initiate it.

Will we see it introduced?

(One other, historical comment for Ray Finch: it was Thomas a Becket who
was the 'troublesome priest', archbishop under Heny II. Thomas More's
problem was how to remain honest to his beliefs as a former chancellor
under Henry VIII).

David Price, Schuman Project:                     
djp@schuman.org 

******

#8
strana.ru
April 10, 2001
Gorbachev, Titov to pool parties
 
Former USSR President and head of the Russian United Social Democratic Party
(RUSDP) Mikhail Gorbachev and Samara Governor and head of the Russian Party
of Social Democracy (RPSD) Konstantin Titov signed a political partnership
agreement in the evening April 9.

Immediately upon signing, both men told Interfax that their cooperation was
aimed "undoubtedly at unification."

To quote Gorbachev, so far they had not set even an approximate date for a
constituent congress of the future party, because "we must feel how the
process of unification will fare."

"At the same time, we have definite deadlines and the first serious trial has
to be the ballot to the State Duma in 2003. To it or even earlier we must
already come within the framework of one party," he stressed.

In his words, RUSDP and RPSD would cooperate already now at local and
regional elections.

He also said that before the signing of the agreement he had told Vladimir
Putin about it and the immediate objectives the Social Democrats pursued.

"In reply, the President told me this: 'I know the people in our country is
social democratic,' and asked me to keep him au courant of the developments,"
he said.

Said Titov: "Social democracy is gaining a growing prestige among the
Russians. The trouble is Social Democrats have very many leaders and each of
them wants to be number one. For this reason the two most organized and big
social democratic parties ought to show an example of unity."

******

#9
Slate.com
April 9, 2001
I Want My NTV!
By Anne Applebaum
Anne Applebaum, a journalist based in London and Warsaw, is a regular
contributor to the London Sunday Telegraph and is at work on a history of
Soviet concentration camps. You can e-mail her at foreigners@slate.com.

Admittedly, it's a colorful story. Valiant press baron struggles to
maintain independence of TV station; journalists broadcast emergency
programs, calling for free speech; tens of thousands of people take to
streets in rainy Moscow and St. Petersburg, clutching umbrellas and banners
reading "NTV is protection from lies." Now, the State Department and the
Council of Europe have issued angry statements, and there are big
personalities involved: Vladimir Gusinsky, the press baron, now in exile in
Spain; Vladimir Putin, the president of Russia; Yevgeny Kiselyov, the talk
show host and former general director of NTV, who has temporarily turned
the station into a battleground. Even Ted Turner is now trying to buy
shares in the company, raising an interesting question: Which is worse for
Russian democracy, President Putin's pro-government television, or the
CNNization of the Russian evening news?

I'm sorry, I suppose it isn't funny. Plus, as I have written before, any
evidence of nascent civil society in Russia is something to be cheered, and
this past weekend's demonstrations are precisely that. It is also true
that, although the business side of this story is complicated, last week's
shareholder meeting did seem to result in an effective state takeover of
NTV, the last Russian national TV station to remain critical of the
government. Given the importance of national television in Russia-where not
everybody can even afford the local papers-this really does bode ill for
the future of open public debate in Russia.

What I don't like about the loud reactions to the NTV story, both in Russia
and abroad, is that they seem to me too little, too late, and not quite on
target. For one thing, it is clear that, whatever good things he may have
done in the course of his career, Gusinsky himself is no hero: At the very
least, had he not plunged his media group, Media-Most, into debt, it would
have been more difficult for Gazprom, the state-controlled energy company,
to take control.

More importantly, despite all the attention being paid to NTV, no one has
paid much attention to the Russian regional media, which has been under a
far more systematic siege for the past several years. I first became
properly aware of this problem six years ago when, at a conference in
Volograd, I encountered a group of Russian journalists. One worked for a
local TV station that was owned by the regional government, as are most
local TV stations in Russia. I asked her what would happen if she broadcast
something critical of the governor. "They would shut us down," she said
flatly.

Paradoxically, this conversation took place at a time when Boris Yeltsin
was still president of Russia, the IMF was still depositing millions of
dollars into the Russian state budget, and no one had yet started much to
worry about the return of authoritarianism to Russia. At the time, there
were, on paper, myriad Russian media outlets: hundreds of TV stations,
radio stations, newspapers. On closer inspection, however, it turned out
that most Russian media were losing money-lots of money. That meant that
many were being bought up, either by one of the Russian "oligarchs," who
were at the time forming big, pro-Yeltsin media groups; or by local
businessmen, who were often fronting for the local governor; or, outright,
by the local governor himself. Sad that no one thought of directing a
little of that Western aid money into teaching local newspapers about the
virtue of the classified ad.

Since then, the situation has grown much worse. Although President Yeltsin
didn't care much for criticism, he seems to have understood, at least in
principle, why a free press is necessary. Vladimir Putin, on the other
hand, believes all media to be pro-state or anti-state, and he actually
seems not to grasp that the press could have any other function. Alexei
Venediktov, the chief editor of Ekho Moskvy, Media-Most's flagship radio
station, was at a meeting that Putin held with Media-Most journalists in
February. The Russian president explained what he thought they should be
doing: "Your job is to support the state." Venediktov says he told him that
" 'we are not an instrument of the state.' He didn't know what I was
talking about."

At the moment, the Glasnost Defense Foundation, a Russian media watchdog
that keeps track of these things, reckons that only about a quarter of the
country's media is even nominally in private hands, and many of these are
businessmen who front for the state authorities. By the end of this year,
they guess that number will fall to 5 percent. This transformation has
official support. Across the country, powerful regional governors,
appointed by Putin, are already creating media-holding groups that will,
among other things, control all access to advertising, effectively
eliminating even the semi-independent regional media that exists at the
moment.

Those not destroyed financially may be eliminated by other means. At Novaya
Gazeta, a feisty Moscow biweekly with a circulation of about 100,000, one
journalist has been murdered. Earlier this year another was beaten
unconscious by thugs who then deliberately etched deep scars into his face
with a knife. Novaya Gazeta's advertisers have begun to drift away; last
year, the paper was subjected to nearly 30 separate "tax inspections,"
which have now become the established form of state harassment in a country
whose tax laws are so complex and so contradictory that it is virtually
impossible for any company to comply with them.

Outside of Moscow, methods have been more direct. Last summer, the Bashkir
authorities laid siege to the region's only independent radio station for
nine days, then they stormed the offices and led the station's employees
away in handcuffs. In Moscow, Venediktov points out that the Russian
authorities are more careful: "Putin wants to stay in the club of world
leaders. He wants to keep up a civilized façade." Thus will the harassment
probably continue at a low level, causing only minimal public reaction,
either in Russia or abroad.

But that, perhaps, has been the oddest thing about the slow attempt to
eliminate opposition press-and, ultimately, opposition thinking-from
Russia: the stunning silence that has, so far, surrounded the whole
process. "Society supports the destruction of NTV," is how Alexei Simonov,
the Glasnost Defence Foundation's president, succinctly puts it. In their
current "national-patriotic mood," he says, many Russians assume, like
their president, that "opposition" journalists, especially those with
superwealthy proprietors, are by definition working against the interests
of the nation.

Yet without NTV, Russia may soon resemble, in the words of one of Simonov's
colleagues, "Russia of the 1970s": a vast state propaganda machine-and a
tiny group of "dissidents," like last weekend's protesters, who oppose it.
Perhaps not coincidentally, that is also the Russia-not Stalin's
nightmarish Russia, but Brezhnev's stultifying Russia-in which Vladimir
Putin came of age and to which he often nostalgically looks back. After 10
years of change in Russia, it seems quite a modest goal toward which to
strive.

*******

#10
Moscow Time
April 11, 2001
How Kokh Should Have Taken NTV
By Yulia Latynina  
 
Last week the entire world witnessed the most incompetent corporate
takeover ever, the April 3 shareholders meeting at which Gazprom-Media took
over management of NTV. Gazprom-Media director Alfred Kokh could have won
the battle at a single blow.

All he had to do was turn the shareholders meeting into a show. He should
have invited as many television crews as he could get. He should have
personally ushered then-NTV general director Yevgeny Kiselyov into the
room. Then he could have slipped out of the room, letting someone else take
over running the meeting as the NTV people listened.

Kokh then could have taken a brigade of police and headed straight for
Kiselyov's office at Ostankino. And that would have been that. By the time
Kiselyov got back, he would have found Boris Jordan sitting at his desk and
a police guard standing at the door.

Kokh has failed to fulfill his orders. Ten months ago, he was told to
deliver a knockout blow. But people are still screaming today.

Throughout the conflict, Kokh's strategy was based on the idea that
everyone could either be scared into submission or bought off. He didn't
realize that oligarchs, unlike bureaucrats, don't sell out. They are used
to being on the other end of a bribe. Sitting across the table from people
like Alfred Kokh.

The state strategy of hiring a bureaucrat like Kokh to do battle against
oligarch Vladimir Gusinsky has led to the extreme embarrassment of the
authorities.

Gusinsky, of course, has a long list of terrible sins to his name. One of
them is vengefulness -Gusinsky, for instance, swore that he would put Kokh
in prison for selling Svyazinvest to the wrong people. Another is the habit
of carelessly tossing aside people who trusted him. A third is active
participation in Russia's information racket: "Be my friend, or I'll eat
you." It is simply not true that Gusinsky has suffered for the sake of
freedom of speech. He has suffered in a struggle for power, having backed
the wrong candidate and lost.

When did Gusinsky's titanic struggle with the authorities begin? Back when
Gusinsky persuaded then-Prime Minister Yevgeny Primakov to persuade
Vneshekonombank to give NTV a loan. Soon after, though, the Kremlin
dismissed Primakov.

Gusinsky then turned to Alexander Voloshin for the loan and was refused.
"But I already agreed with Primakov," Gusinsky probably said. "And who is
Primakov?" came the reply. "Do you see any Primakovs here?"

And that is when we began to see all the "truth" about the Kremlin on NTV.
The stuff about "the Family." About Roman Abramovich and Tatyana Dyachenko.
Much of what was said was, no doubt, the truth - but it was a truth that we
likely would have never learned if Gusinsky had just gotten his loan.

A blackmailer who gets paid off holds his tongue.

But Gusinsky wasn't one to give up easily. Even after he had lost the game,
he continued to present ultimatums to the authorities and it is for these
ultimatums that the journalists of NTV must now suffer.

Yes, freedom of speech was never important for Vladimir Gusinsky. He was
always after power and money. But Kokh forced him to choose between money
and "going for broke." Gusinsky chose the latter.

Thanks to Kokh, Russia had nine months of genuinely independent television.
Thank you, Alfred Kokh.

He turned one of the instruments of the struggle for power into a last,
desperate, hopeless bastion of Russian freedom.

He forced the oligarchs to be free. And in doing so, he has hopelessly
compromised the Kremlin.

Yulia Latynina is a journalist for ORT.
 
*******

#11
Moscow Times
April 11, 2001
London Feels for Russia's Economic Pulse
By Igor Semenenko
Staff Writer

LONDON - Hundreds of business executives are gathering in London this week
to talk up investments in Russia and fish for new clients.

"There he goes," said a broker looking at a potential client during a
coffee break at the 4th Annual Russian Economic Forum. "Patience. We should
not pounce on all of them at once."

"I invest my time and my career in Russia, but not my money," said a
consultant, who did not want to see his name under such a quote in a
newspaper.

Former Prime Minister Viktor Chernomyrdin, who was dismissed in 1997,
puzzles the audience with an acute record of his premiership: "Only in the
last two years has the state achieved consistency in its economic policies."

About 800 people were expected to attend the two-day conference. First
Deputy Prime Minister Alexei Kudrin had been expected to help kick off the
conference Tuesday, but because of German Chancellor Gerhard Schr?der's
visit to Russia, Kudrin's speech was delayed until Wednesday.

For Britain, Russia is still more of an exotic place with sub-freezing
temperatures than a real business partner.

Annual exports of goods and services from Britain amount to a hefty ?230
billion ($330 million), according to British Trade International, the
government agency responsible for promoting British trade and investment
abroad. One does not need to be a guru to see where Russia stands with a
bilateral trade figure of ?2.2 billion.

But there are some areas that have real significance. During an afternoon
panel discussion, the oil and gas room was fully packed.

Tellingly, the corporate governance panel in the neighboring room gathered
only about one-fifth as many people.

And there is talk about President Vladimir Putin, of course.

"One year is enough to draw a line under the president's record," said
Boris Nemtsov, the leader of the Union of Right Forces in the State Duma.

On the positive side, he said, there is the overhaul of the tax system, the
curbing of the governors' powers and attempts to kick-start land reform.

On the blacklist are the war in Chechnya, a law allowing governors to serve
three and four terms and the drama unfolding around the national television
channel NTV.

"The NTV case is a showdown - there is no respect for property in Russia,"
said Nemtsov. "Who will buy property if the owner of 46 percent, Gazprom,
and the owner of 49.5 percent, [Vladimir] Gusinsky, are in a tug-of-war
with both sides attempting to leave the interests of the other major
shareholder unserved?"

Nemtsov was critical of Putin: "He should understand that St. Petersburg is
not the only place to recruit his team."

Nemtsov's criticisms followed upbeat introductory remarks about Russia's
great potential and woke up the audience.

One of the organizers of the -conference, Simon Joseph, said at first he
was concerned when Nemtsov effectively took Kudrin's place as the first
Russian politician to address the conference.

"But then I started to realize it was just perfect," Joseph said. "He sets
the tone. He speaks his mind. If I were a delegate, I wouldn't want to feel
cheated, as if I was getting something I could read in any analytical report."

Alfa Group head Pyotr Aven added fuel to the fire. "The government spends
too much. And I do not like the pension reform plan proposed by the Pension
Fund.

"From the point of view of structural reforms, this year has been lost,"
said Aven.

The excuse to spend two days in London in spring brought some relief for
many participants.

"I'm glad this place was chosen to host the conference," said Chernomyrdin,
who exhibited a nice tan.

But the next speaker brought everybody back to life.

"The transfer of production-sharing agreements from the Energy Ministry to
the Ministry of Economic Development and Trade caused a bit of a delay in
the implementation and finalization of these steps," said Rein Tambouzer,
president of Shell Exploration and Production Services in Russia.

Shell's rival BP Amoco has plowed in $2 billion in Russia, but it has
learned to walk cautiously.

"The pace at which we will proceed will be dictated by the speed of
reform," said Scott Kerr, chief executive for BP in Russia and Kazakhstan.

Having roller-coasted with Russia in the past 10 years and now seeing the
economy hiccup after two years of double-digit growth, the business
community is getting ready for the worst.

"The problem is that we went up to such a high that the only way now is
down," said Iosif Bakaleinik, chief financial officer with Tyumen Oil Co.

In some senses, the new administration made even more radical steps than
any of its peers in the West.

"Seeing a 13 percent flat income tax in Russia, some foreign businessmen
are ready to apply for Russian citizenship," said Nemtsov. "They ask only
one question: How long will it [the tax bonanza] last?"
 
*******

#12
Russia: Twist In Swiss Justice May Work In Borodin's Favor
By Sophie Lambroschini

Just hours after being transferred from a prison in New York to one in
Geneva, former Kremlin aide Pavel Borodin was charged with money laundering
by Swiss officials. Now, as Borodin's lawyers prepare for today's bail
hearing, RFE/RL's Moscow correspondent Sophie Lambroschini reports
speculation is mounting over whether Swiss justice officials can fight their
own system to build an air-tight case against the well-connected Russian.

Moscow, 10 April 2001 (RFE/RL) -- After two years of investigation, Swiss
prosecutors' efforts finally paid off. On Saturday (7 April), former Kremlin
official Pavel Borodin was delivered to Geneva's Champ-Dollon prison and
officially charged with money laundering.

The charge comes in connection with allegations that Borodin accepted $25
million in kickbacks in exchange for awarding lucrative contracts to two
Swiss construction firms for renovation work on the Kremlin. The so-called
Mabetex scandal, the name of one of the two Swiss construction firms, is one
of the major corruption cases to emerge from Russia in recent years. But a
growing rift within the Swiss justice system may mean the prosecutors'
victory will be short-lived.

The Russian Prosecutor-General's Office, which conducted its own
investigation into the matter, concluded that Borodin could not be charged
with criminal behavior. Now, the "accusation chamber" -- the Swiss judicial
body charged with overseeing investigative procedure -- says that if Russia
sees no instance of corruption, the Swiss charges against Borodin are
baseless.

Because the accusation chamber is also responsible for determining bail,
Borodin's defense team has cause for optimism going into today's bail
hearing. Lawyer Eleanora Sergeyeva outlined the arguments the defense would
present at the hearing:

"The defense considers that [Borodin] was arrested in New York without a
legal basis. The defense considers that the arrest warrant was issued without
sufficient grounds. The defense considers that in this case there is
insufficient proof that Borodin is involved. And that there was practically
no infraction [to begin with] at all."

Borodin was arrested at a New York airport on 17 January after Swiss
officials issued an international warrant for his arrest. But last week at
the outset of an extradition hearing in New York, Borodin volunteered to go
to Switzerland and face his accusers. Sergeyeva told RFE/RL that the
accusation chamber's position was "one of the reasons" Borodin agreed to hand
himself over to Swiss justice officials. She explained why the today's bail
hearing could play a crucial role in the eventual outcome of the case:

"In principle, the court's decision on [whether to grant] bail does not
legally influence the [final] judgment in the case. However, I do think that
the reasoning the accusation chamber will state today [in its ruling] will
say something about the court's attitude toward the case."

Borodin, who was appointed by then-President Boris Yeltsin to manage the
Kremlin's vast property empire in 1993, stands accused by Geneva general
prosecutor Bernard Bertossa and judicial investigator Daniel Devaud of
receiving $25 million in kickbacks. The kickbacks allegedly came from two
Swiss construction firms, Mabetex and Mercata, to ensure they were awarded
renovation contracts in the Kremlin.

Bertossa made no comment today on the accusation chamber's possible impact on
his hard-won case against Borodin. But he and Devaud have both argued that
criminal corruption does not need to be recognized in Moscow if it is
considered punishable under local Swiss law.

In an interview to RFE/RL earlier this year, Bertossa said that he had
"indisputable documentary evidence [which] demonstrates that Mr. Borodin had
'commissions' paid to him." The Swiss prosecutor added that regardless of
Moscow's position on the case, "under Swiss law, [Borodin's] behavior is a
crime, and it is under Swiss law that money laundering in Switzerland is
judged."

In an interview published 8 April in the Russian daily "Kommersant," Bertossa
did express irritation with Russian prosecutors, saying that Borodin's case
is "a first" in that the country in which the "crime [of corruption] was
committed openly refuses to act."

Borodin's case has often been compared to that of Sergey Mikhailov, an
alleged mafia boss whom Swiss officials hoped to make one of the first
"Russian godfather behind bars." But in 1998, after spending some two years
in Geneva's Champ-Dollon prison for allegedly belonging to an organized crime
syndicate, Mikhailov was acquitted by a Swiss court -- and even received
financial compensation from the authorities. Russian and Swiss media have
speculated that the utter failure of the Mikhailov case has put additional
pressure on the Swiss prosecution to secure a conviction this time around.

The Mabetex case repeatedly made headlines in Russia two years ago as Swiss
investigators and then Prosecutor-General Yury Skuratov implicated first
Borodin and then Yeltsin's closest friends and even his daughters. Clearly
unnerved by the political ramifications of the case, Kremlin insiders
repeatedly said the case was invented by Yeltsin's opponents.

Russian media speculated the Yeltsin regime feared that charges against
Borodin would compromise both the past and present political leadership.

Although Borodin was hired by Yeltsin, he also has strong links with current
President Vladimir Putin. It was Borodin who first brought Putin into federal
politics in 1996, when Putin -- then an official in the St. Petersburg
mayor's office -- joined Borodin's Kremlin property committee. As Borodin's
deputy, Putin was responsible for managing former Soviet real estate, worth
millions of dollars, in 78 different countries.

Shortly after becoming prime minister in 1999, Putin told Russian television
that he credited Borodin with his move to the Kremlin.

******

#13
US Administration Shows 'Sensible Restraint and Flexibility' Over  EP-3 Incident 
Rossiyskaya Gazeta
April 7, 2001
[translation for personal use only]
 Article by political observer Vsevolod Ovchinnikov under "Situation"
rubric:  "Pentagon's Pacific Emergencies"

   For a whole week now -- since last Sunday [1 April]
-- relations between Washington and Beijing have been in profound crisis
because of a collision between a US reconnaissance aircraft and a Chinese
fighter-interceptor.

   The US military department has recently been unlucky with both the
chief ally and the chief rival of the United States in the Asia and
Pacific region.  It is not even two months since a US nuclear-powered
submarine rammed a Japanese training vessel during an emergency surfacing
near the Hawaiian Islands.  The deaths of nine people occasioned a sharp
growth in anti-US feeling in Japan, where 47,000 US servicemen are
stationed to this day, while US nuclear submarines frequently put into
Tokyo Bay, where the likelihood of a collision between vessels is very
great.

   Now the Department of State is having once again to clear up the mess
made by the Pentagon.  But this time the matter concerns China.  A
four-engine US Air Force aircraft equipped with the latest means of
electronic reconnaissance and intelligence collection took off from
Okinawa to conduct a routine espionage mission off the Chinese coast.  By
all accounts, it was gathering information on missile bases deployed
along the Formosa Strait in Fujian Province.

   The US reconnaissance aircraft was intercepted by two Chinese fighters
south of Hainan Island, above a coastal area which is an exclusive
economic zone of the PRC.  They set about "squeezing" the violator out of
the surveillance zone.  During hard maneuvering the EP-3 reconnaissance
aircraft, which is the size of a small Boeing passenger aircraft,
unexpectedly changed course and caught the wing of one of the
interceptors.  The Chinese aircraft plunged into the sea, and the pilot
ejected, but, by all accounts, perished.

   The US aircraft was also badly damaged by the collision.  It put out a
distress signal and made a forced landing at a military airfield on the
Chinese island of Hainan without even requesting permission.  The 24
people on board were not injured.  But Washington is concerned not for
the fate of the crew but for the reconnaissance aircraft's top-secret
equipment, which, in all probability, has fallen into the hands of
Chinese specialists.

   Representatives of the US Embassy at once arrived on Hainan from
Beijing, demanding the airmen's release and the aircraft's return.  The
first persons of both states -- President Bush and President Jiang Zemin
-- joined in the argument over who should apologize and take
responsibility for the incident.

   The Americans are refusing to apologize, insisting that their aircraft
is inviolable as a part of US territory, and even threatening to strip
China of its status as "a normal trading partner of the United States" if
its airmen are not released without delay and the aircraft returned.

   But not only this accounts for the stormy response which the incident
off Hainan Island elicited among the Chinese people.  People have not
forgotten how the PRC Embassy in Belgrade was damaged by a US missile
during the bombing of Yugoslavia in 1999.  Therefore the downed Chinese
fighter has reopened a painful wound.  Fearing a repeat of the
thousands-strong anti-US demonstrations in Beijing and other cities,
Washington has moderated its tone and ordered the three destroyers which
had at first been sent to Hainan Island for a show of force to return
home.

   Meanwhile, the dramatic end to the espionage mission occurred at an
extremely tense time in Chinese-US relations.  Shortly prior to this the
new US Administration had started talking about providing Taiwan with a
batch of Aegis-class destroyers with surface-to-air missile systems, each
one of which can simultaneously manage more than 100 targets.

   These destroyers are a key link in a theater antimissile defense
system.  So their delivery would mean that Taiwan has subscribed to this
venture of the Pentagon's.  Beijing issued a strongly-worded protest,
unequivocally telling Washington that such a step would do irreparable
harm to Chinese-US relations.  After the meeting between President Bush
and Vice Premier Qian Qichen the US side started speaking of a compromise
option -- providing the Taiwanese first with older Kidd-class destroyers.

   Having called China a "strategic rival of the United States," the new
incumbent at the White House does not want to enter into direct
confrontation with it.  China is also interested in preserving a working
relationship with the leading world power.  Therefore both sides are in a
hurry to settle the incident which occurred off Hainan Island.  Reports
have appeared that US Secretary of State Colin Powell may soon arrive in
Beijing for just this purpose.

   The incident off Hainan Island has shown that, despite emotional
rhetoric, the Bush Administration is avoiding talking with Beijing in the
language of threats and is showing sensible restraint and flexibility. 
It will be good if the White House displays similar qualities in other
areas as well.

******

#14
strana.ru
April 10, 2001
U.S. agents try to recruit Russian hacker to get into FSB computer network
 
Several members of the staff at the U.S. embassy in Moscow made an attempt to
recruit a Russian hacker to break into the computer network of the Federal
Security Service, or FSB. The Tuesday edition of Moskovsky Komsomolets
carries a story about this with reference to sources in Russian secret
services. The FSB's PR Center has confirmed this information.

The Moscow student cum hacker, that is called Verse in the MK story, got
acquainted through Internet with an American called William Smith, who
introduced himself as a retired U.S. Air Force Colonel. The latter introduced
the hacker to several members of the staff at the U.S. embassy in Moscow.
Some of them met with the student several times and tried to recruit him on
January 23, 2001.

Among the Americans who had made contact with the hacker at the embassy were
Mr. B.B. Gorman, John F. Conners, G. Allan Dixon and Michael Pyszczymuka.

"On January 23, 200, while at the U.S. embassy in Moscow, I was approached on
the matter of secretly collaborating in the interests of American
intelligence services against the Russian Federation," the Moscow student
wrote in his testimony. "I was to use the following methods of communicating:
instructions from the Americans were to be sent to my mobile phone in the
form of SMS-messages, and I was to report on fulfillment of assignments by
way of SMS-mobile communications or via E-mail. I was told that I would
receive an assignment within the next two weeks. I was to sign my messages
with my code name."

On January 25, the hacker was instructed to break into the FSB central
servers and their donor machines. He was also to create technological and
program bases for conducting electronic intelligence; selecting groups of
hackers capable of mounting hacker attacks; searching for and copying data
bases interesting the Americans; destroying parts of the data bases that
would be pointed out to him.

But the student cum hacker did not live up to the expectations of the
American intelligence arms. On the following morning, he gave himself up at
the FSB reception office. After being questioned, he was released. According
to Russian laws, an agent who voluntarily gives himself up is exempt from
criminal prosecution.

In the meantime, the FSB has taken note of increasing interest on the part of
hackers to the computer networks of that intelligence agency. "Every day, we
register from ten to 30 hacker attacks. The hackers work round the clock
every day of the week," the FSB's computer and information security
department reports.

******

#15
Russia: About 15,500 Chechen rebels killed since August 1999
ITAR-TASS

Groznyy, 10 April: Federal troops have killed some 15,500 Chechen rebels
during an antiterrorist operation which began early in August 1999, sources
from the headquarters of the federal troops in the North Caucasus told
ITAR-TASS today.

About 2,500 terrorists were killed during the first stage of the operation
(from 2 August to 1 October 1999), when federal troops were liberating
Dagestan's regions occupied by rebel troops who had made an armed incursion
into that Russian republic.

Another 4,000 rebels were killed at the second stage (from 1 October to 25
November 1999), when the so-called "security zone" was created in the restive
republic of Chechnya.

A total of 7,500 rebels were killed during the third stage of the operation
in Chechnya's lowland and highland regions (from 25 November 1999 to 15 April
2000). More than 1,500 extremists were destroyed during an assault on the
village of Komsomolskoye.

Extremists' losses have amounted to 1,500 since a special part of the
antiterrorist operation began on 15 April 2000, in which federal troops are
fighting against minor rebel groups.

Meanwhile, up to 100 peaceful Chechen citizens are killed by rebels every
day, sources at the headquarters said. They stressed that if that situation
persisted "the entire Chechen people may be exterminated by mercenary
murderers".

They also said that more than 1,400 small arms, more than 700,000 cartridges,
657 grenade launchers, more than 300 mines, over 4,800 hand grenades, more
than 750 kg of explosives as well as a big amount of artillery ammunition
have been seized in Chechnya since the start of the year.

That testifies to the fact that Chechen rebels have stored up major amounts
of armaments as well as that channels of their supply still exist, the
military stressed.

They link that with "a continuing foreign help to rebels, who step up their
activity in Chechnya".

******

#16
EU blasts Russia over nuke cleanup
By DOUGLAS BAKSHIAN

LUXEMBOURG, April 10 (UPI) -- The European Union Tuesday accused Russia of
delaying plans to clean up its environment, especially hazards such as old
nuclear submarines in the Barents Sea region.

EU Commissioner for Foreign Affairs Chris Patten said Moscow is holding up
negotiations on an agreement that would allow the release of European, U.S.
and other international money to deal with the problem.

"We were profoundly disappointed by the discussions last week (in Berlin)
which went backwards," he said. "We had a very frank and helpful exchange on
that issue upstairs (today) and I hope that that will help to get
negotiations back on track."

"I can't emphasize sufficiently how important we regard this agreement in
the EU."

Patten made his comments following talks Tuesday with members of a
high-level Russian delegation, led by Russian Deputy Prime Minister Viktor
Khristenko.

The agreement is called the "Multilateral Nuclear Environment Program in
Russia," or MNEPR. For two years, the EU has been negotiating the pact with
Moscow. Diplomats say the framework would set up procedures for
international aid to help Russia clean up nuclear submarine waste.

Russian officials in Luxembourg did not immediately comment. Russia is not
an EU member, but the sides maintain ties through what is called a
cooperation council. Sweden, which holds the rotating EU presidency, also
took part in the talks.

Moscow needs foreign capital to deal with environmental threats such as
rusting nuclear submarines in the Barents Sea. Diplomats in Luxembourg say
there are complications involving taxation and liability for the foreign
firms that would work in the area. The EU had hoped to resolve the matter
ahead of the EU-Russia summit in Moscow in May, but diplomats expressed
doubts there will be a breakthrough.

According to analysts, many nuclear reactors and large amounts of spent
nuclear fuel are decaying in the Barents Sea area, the same region where the
Russian nuclear submarine Kursk sank last August.

******

CDI Russia Weekly:  http://www.cdi.org/russia

Johnson's Russia List Archive (under construction):  http://www.cdi.org/russia/johnson