CDI Russia Weekly

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Edited by David Johnson 
ISSUE #36 February 19, 1998

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.
 

Contents

  1. Moscow Times: Andrei Piontkovsky, SEASON OF DISCONTENT: U.S.-Russian Missile Angst Easy to Allay.
  2. Itar-Tass: Academician Favors START-II Ratification. (Kokoshin).
  3. Itar-Tass: Russia Not Engaged in Talks with USA on Abm Treaty Official.
  4. Itar-Tass: Rosvooruzhenie Offers Over 140 Samples of Russian Weapons.
  5. RFE/RL: Paul Goble, East/West: Analysis From Washington -- EU, NATO, European Divisions.
  6. VOA: Eve Conant reports on politics in Russia's Far East.
  7. Kennan Institute meeting report: Ukraine in 1999: Objectives for U.S. Policy.
  8. Salt Lake Tribune editorial: Russia's Y2K Plea.
  9. Globe and Mail (Canada): Geoffrey York, In Poland, East is East and West is West.
  10. Moscow Times: Pavel Felgenhauer, DEFENSE DOSSIER: Brass Cool Over Y2K Heat.
  11. Itar-Tass: Russia-NATO Council Discusses Two Opposing Doctrines.
  12. AFP: Russian defence industries branch out to survive.
  13. Jamestown Foundation Monitor: WEEKLY REPORTS THAT BEREZOVSKY'S ARREST IS IMMINENT.
  14. Moskovskiy Komsomolets: Citizens Keeping $40 Billion 'in Their Socks.'


#1
Moscow Times
February 18, 1999
SEASON OF DISCONTENT: U.S.-Russian Missile Angst Easy to Allay
By Andrei Piontkovsky

At their recent meeting in Moscow with U.S. Secretary of State Madeleine
Albright, Russia's top brass, maps in hand, told her of their concerns about
the United States' Nuclear Missile Defense, or NDM, program. As several of our
commentators later wrote, the American side received a "curt, well-deserved
rebuff."

I interpret this, however, as the start of a serious professional dialogue.
The position of the United States is that it is preparing to develop an anti-
missile system to shield the nation from isolated terrorist missile strikes.

By having a limited capability to intercept only 20-30 missiles the system
would not jeopardize Russia's nuclear deterrent (its second strike capability
to launch about 1,000 missiles). Accordingly, strategic stability between the
two nuclear powers will not be upset, although the provisions of the 1972
Anti-Ballistic Missile treaty will need some modification.

However, the Russian military is protesting that the creation of even a
limited anti-missile defense system entails the development of a broad basic
infrastructure of systems both on the ground and in space that would allow the
expansion of the system's capabilities in the future.

In the long run, then, such a move does jeopardize Russia's deterrence.
Moreover, the unilateral exit of the United States from the 1972 ABM treaty
would remove the question of strategic nuclear armament from the international
legal context.

Washington seems to have taken these arguments seriously enough. Last week,
Pentagon spokesman Michael Doubleday said "we want to discuss with the
Russians the ABM treaty itself as well as our own program in order to agree on
whatever is necessary." He also rejected assertions that Washington would move
to alter the ABM treaty irrespective of Moscow's stance.

And so we have the Americans preparing to develop a limited NDM system for
fear of nuclear terrorist strikes, and the Russians worrying that this system
may undermine their nuclear deterrent. Is it possible to reconcile these
positions? I think it is. For those familiar with nuclear strategy there is
clearly no fundamental contradiction here, as an explanation in terms of State
A and State B shows.

In a nuclear world, State A should be no less interested in the reliability of
State B's nuclear deterrent than in its own, because if State B is uncertain
of its deterrent capability, i.e. of its second strike capacity, then in a
moment of acute military and political crisis B may be tempted to strike
first.For this reason the United States should do its best to disperse any
concerns that Russian strategists have about the future of Russia's nuclear
deterrent because it corresponds to their security interests.

The United States and Russia should approach all the issues linked with the
ABM treaty and the NDM program not as an ideological or political problem, but
rather as an operational research challenge: how to design an American NMD
system that doesn't affect Russia's nuclear deterrent.

The answer is paradoxically simple. The dimensions of the American system
should be defined by Russians. Let Russian military experts formulate
restrictions they consider necessary to impose on such a system (parameters of
its infrastructure, extent of military means, geographical zones of
deployment, etc.), and all of these restrictions should then be accepted by
the U.S. and fixed by law in a new international agreement complementing the
1972 treaty.

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#2
Academician Favors START-II  Ratification

MOSCOW, February 17 (Itar-Tass) - The earliest ratification of the
START-2 Treaty, apart from meeting the interests of Russian national
security, makes a substantial contribution to ensuring strategic stability in the world,
claimed here on Wednesday former secretary of the Russian Security Council and
present acting vice-president of the Russian Academy of Sciences Andrey Kokoshin.

  Asked by Itar-Tass whether Russia now needs costly general-purpose
troops, Kokoshin emphasised that "although nuclear deterrence continues to
remain one of themain elements of  ensuring Russia's national security, it is necessary to
observe a balance in developing strategic nuclear forces and general-purpose troops".

  In the vice-president's opinion, it is expedient to proceed from
possibilities of "the country's economic potential and present-day estimates of
challenges and threats in the sphere of the country's military security".

  Kokoshin pointed to the need of radical improvement in funding R&D as
well as armament purchases. He pointed to the importance of urgent payments
of the state's debts to factories of the military-industrial complex and research
institutions.

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#3
Russia Not Engaged in Talks with USA on Abm Treaty Official.

MOSCOW, February 18 (Itar-Tass) - A senior Russian Defence Ministry
official said on Thursday that Russia "holds no talks with the USA on
changing the 1972 ABM treaty," although attempts are made to drag Russia
them.

Colonel-General Leonid Ivashov, head of the Defence Ministry's main
department for international cooperation, confirmed that Russia "comes out
against changes in the treaty, as it sees no necessity in that".

According to him, changing the treaty will destroy the system of strategic
stability in the world, basing on the START-1, START-2 treaties as well as
treaties on medium- and short-range missiles.

Ivashov told reporters that he believed the US attempt to change the ABM
will give other countries, in particular China, India and west-European
countries, grounds for developing missile technologies and anti-missile
systems.

The general emphasized that the USA wants to confront Russia with a fact by
allocating means for the development of national air-defence systems.

Ivanov was participating in a session of the Russian-US consultative group
on defence matters.

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#4
Rosvooruzhenie Offers Over 140 Samples of Russian Weapons.

MOSCOW, February 18 (Itar-Tass) - The Russian Rosvooruzhenie company offers
over 140 samples of Russian weapons and military hardware to foreign
customers in a specially compiled catalogue, the presentation of which will
be held at Fototsentr in the Gogolevsky Boulevard on Friday, Itar-Tass
learnt here on Thursday at the public relations centre of the
Rosvooruzhenie firm.

Managing director of the company Grigory Rapota will deliver a speech at
the presentation. Honorary guests will include world-famous designer of
firearms Mikhail Kalashnikov.

An exhibition which will have on show a catalogue of more than 120
photographs of export samples of advanced Russian weapons and military
hardware, will open simultaneously with the presentation of the catalogue.
It will be the first exhibition in the history of military cooperation
between Russia and foreign countries.

Rosvooruzhenie is a firm, representing interests of the Russian military
and industrial complex. It delivers weapons and military hardware, spares
to them, technologies of dual designation, provides servicing and training
of foreign specialists at Russian military educational establishments.

The company is responsible for 90 percent of export deliveries of Russian
weapons and military hardware. Rosvooruzhenie cooperates with over 50
countries and has offices in 33 states.

According to estimates of military experts, efficiency, simplicity and low
prices are the main features of Russian weapons, determining their
competitiveness on world markets.



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#5
East/West: Analysis From Washington -- EU, NATO, European Divisions
By Paul Goble

Washington, 17 February 1999 (RFE/RL) -- The expansion of the European
Union could divide Europe even more than the
expansion of NATO, not only exacerbating existing international tensions
but possibly creating new ones as well.

And to the extent that proves to be the case, often-heard suggestions that
EU expansion could serve as a surrogate for the
security that NATO expansion would definitively provide may prove
ill-founded. Indeed, the expansion of the EU could under
certain circumstances create security problems which the Western defense
alliance might have to cope with.

This somewhat unexpected conclusion is suggested both by the comments of a
Kaliningrad political leader and even more by the
outcome of a Monday meeting between a delegation from the European
Commission, the EU's executive body, and senior Russian
officials in Moscow.

Speaking to a Western reporter recently, Sergei Pasko, the leader of a
pro-business party in Kaliningrad, said, "It's not NATO
expansion we're afraid of, but EU expansion." And he gave compelling
reasons for his conclusion.

On the one hand, if as seems likely Lithuania follows Poland into the
European Union, Pasko's region of Kaliningrad, the
non-contiguous portion of the Russian Federation that once was part of
Germany but is now populated largely by ethnic Russians,
would find itself surrounded by EU states, a situation that would make
trade across its borders far more difficult.

On the other, if Kaliningrad tries to extricate itself from that situation,
it faces few good options. Most officials in Moscow would
likely oppose giving Kaliningrad either the autonomy or the free trade zone
status that might allow it to take advantage of being a
neighbor of EU states.

At the same time, few in the Russian capital appear likely to be willing or
able to provide Kaliningrad with the subsidies it would
need to overcome its current economic and social difficulties.

And that combination could convert Kaliningrad into a security flashpoint
in Eastern Europe, either by setting the stage for
demands by Kaliningrad residents for greater autonomy or independence than
Moscow would accept or by creating conditions that
might prompt Germany, Poland and Lithuania to expand their roles in the
region.

But the potential problems created by European Union expansion are not
limited to Kaliningrad. Indeed, the potential for such
problems elsewhere was highlighted by a meeting in Moscow Monday between
Russian Deputy Prime Minister Vladimir Bulgak
and Ottokar Hahn, the head of a delegation from the EU executive.

While both sides put the best face on the situation, each was careful to
point out that the EU and the Russian Federation will have
to approach one another with extreme care if they are to avoid problems.

Bulgak stressed in his closing statement that "the problems that exist in
relations between Russia and the EU can be resolved
without detriment to their respective interests" only if the two sides work
"in full compliance with the spirit and letter" of their
cooperation agreement.

The Russian official indicated that Moscow was especially concerned about
being frozen out in any way from the sale of Russian
energy to European markets. But while he did not say in public, Bulgak and
others in Moscow may also be very concerned about
restrictions on the flow of labor and citizens as well.

One reason for thinking that issue is very much on Russian minds was a
statement on the same day by Germany's Deputy Foreign
Minister Guenter Verheugen. He noted that EU countries are prepared to
extend visa-free travel to the Baltic countries precisely
because the latter have strong border controls along their eastern frontiers.

The European Union has made such controls a requirement for closer
integration, and those countries that want to join have
willingly agreed to it. But such border controls which allow free movement
within the EU also have the effect of limiting
movement into the EU. And that in turn affects EU relations with Russia and
other post-Soviet states.

In various commentaries over the last several years, Russian officials have
generally viewed the eastern expansion of the EU as a
positive development for Russian interests. Indeed, they have suggested
that a Russia-EU border would work to Moscow's
advantage even as they have argued that a Russia-NATO border would be
destabilizing.

But these more recent developments suggest that at least some in Moscow may
now see the EU expansion in a different light, one
far less favorable and more likely to spark conflict than they or others
had earlier assumed.

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#6
Voice of America
DATE=2/17/99
TITLE=RUSSIA / POLITICS
BYLINE=EVE CONANT
DATELINE=VLADIVOSTOK

INTRO:  RUSSIA'S FAR EAST, SOMETIMES REFERRED TO AS THE "WILD
EAST," HAS FOR YEARS BEEN THE SCENE OF POLITICAL INFIGHTING.  BUT
OBSERVERS SAY THAT AS ITS COLORFUL POLITICIANS BATTLE FOR POWER,
THE ECONOMY IS BEING EATEN AWAY BY CORRUPTION AND GOVERNMENT
NEGLECT.  V-O-A'S EVE CONANT REPORTS FROM VLADIVOSTOK.

TEXT:  PERHAPS ONE OF THE MOST VIVID RESULTS OF THE POLITICAL
INFIGHTING IN VLADIVOSTOK IS A HALF FINISHED FREEWAY OVERPASS.
THE BRIDGE HAD BEEN A DREAM OF THE CITY'S FORMER MAYOR, VICTOR
CHEREPHKOV.  BUT NOW HE HAS BEEN OUSTED, AND HIS GIANT THREE-LANE
PROJECT IS BEING USED BY PEDESTRIANS TO WALK THEIR DOGS.

THE BRIDGE IS JUST ONE OF MANY CASUALTIES OF A FIVE-YEAR
POLITICAL BATTLE BETWEEN THE REGION'S AUTHORITARIAN GOVERNOR,
YEVGENY NAZDRATENKO, AND THE ECCENTRIC MR. CHEREPHKOV.

THE POLITICAL SOAP OPERA HAS RAGED AS THE REGION SUFFERED
CONTINUAL ENERGY BLACKOUTS, MONTHS OF OVERDUE WAGES, AND A
GROWING REPUTATION AS ONE OF RUSSIA'S MOST CORRUPT CITIES.  BUT
THE FIGHTING HAS ALSO TURNED INTO SOMETHING AKIN TO A POLITICAL
FARCE.  LOCAL ELECTIONS HAVE BEEN INVALIDATED 15 TIMES, THE
FORMER MAYOR CLAIMS TO HAVE EXTRASENSORY POWERS, AND LOCAL
BILLBOARDS HAVE COMMENTARIES SUCH AS "VLADIVOSTOK IS NOT A
PSYCHIATRIC WARD."

GOVERNOR NAZDRATENKO CALLS THE FORMER MAYOR THE TOWN "CRAZY," BUT
THE EX-MAYOR IS STILL ONE OF HIS FAVORITE TOPICS OF CONVERSATION.

       ///  NAZDATENKO ACT - IN RUSSIAN - FADE UNDER  ///

THE GOVERNOR SAYS,  "AH!  ASK ME ANYTHING ABOUT CHEREPHKOV, HE'S
MY FAVORITE THING TO RIP APART.  EVERYTHING IS MUCH BETTER NOW
THAT HE'S GONE."

BUT MR. CHEREPHKOV, WHO IS NOW SUING RUSSIAN AUTHORITIES TO GET
HIS JOB BACK, SAYS THE ONLY REASON THE CITY HAS ELECTRICITY IS
BECAUSE OF A PLOT TO MAKE HIM LOOK BAD.  HE SAYS THE ELECTRICITY
WILL SOON RUN OUT.

BUT DESPITE HIS PROBLEMS, MR. CHEREPKHOV, WHO STILL ENJOYS WIDE
SUPPORT IN VLADIVOSTOK, SAYS THE POLITICAL FIGHT IS A GOOD THING.

       ///  CHEREPKHOV ACT - IN RUSSIAN - FADE UNDER  ///

MR. CHEREPKHOV SAYS THE POLITICAL TEMPERATURE IN VLADIVOSTOK
SHOULD BE HIGH.  IF THERE IS  NO  STRUGGLE, HE SAYS, SOCIETY ROTS
AND CORRUPTION FLOURISHES.

BUT LOCAL RESIDENTS, SUCH AS TAXI DRIVER VIKTOR KARCHAT, ARE  NOT
AMUSED BY THE POLITICAL STRIFE.

         ///  KARCHAT ACT - IN RUSSIAN - FADE UNDER  ///

HE COMPLAINS THAT EVERY OTHER DAY THE POLITICIANS FLY TO MOSCOW
TO SUE EACH OTHER.  AND THE MONEY FOR THEIR PLANE TICKETS, HE
SAYS, COMES OUT OF MY TAXES.

THE BATTLE BETWEEN THE TWO LEADERS HAS BEEN SO HOT THAT RUSSIAN
PRESIDENT BORIS YELTSIN APPOINTED THE LOCAL SECURITY SERVICE
CHIEF, VICKTOR KONDRATOV, TO ACT AS HIS PRESIDENTIAL
REPRESENTATIVE TO KEEP TABS ON THE POLITICAL CHAOS.
CONTRADICTING LOCAL OBSERVERS, MR. KONDRATOV SAYS HE BELIEVES THE
POLITICAL ATMOSPHERE AND CORRUPTION IS NOW UNDER CONTROL.

        ///  KONTRATOV ACT - IN RUSSIAN - FADE UNDER  ///

HE SAYS ORGANIZED CRIME GROUPS IN RUSSIA GROUPS ARE NOW MORE
INTERESTED IN OTHER COUNTRIES.   WE ARE NOW POOR AS RATS, HE
SAYS, ASKING, WHAT IS LEFT FOR THEM HERE?  (SIGNED)

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#7
Kennan Institute of Advanced Russian Studies
Washington DC
Meeting report
U.S. Policy on Ukraine: Looking to the Future
By Nancy Popson

"Ukraine in 1999: Objectives for U.S. Policy" (January 11, 1999) Seminar at
the Kennan Institute of the Woodrow Wilson International Center for
Scholars, Washington, D.C.

"Many people in the U.S. who have been working on Ukraine over the
past several years have felt they were swimming upstream," remarked John
Tedstrom, Research Leader for Russian, Ukrainian, and Eurasian Affairs at
RAND Corporation in Washington, D.C., at a Kennan Institute lecture on 11
January 1999. He posited that they have been swimming not upstream, but in
the wrong river.

Tedstrom suggested that the U.S. make a strategic adjustment in its policy
toward Ukraine in order to shift to "the right river." In essence, the U.S.
should stop focusing on Ukraine as a former Soviet Republic and begin to
look at it as an emerging European country. Tedstrom noted that 1999 is the

year for this strategic adjustment to take place, as both the geopolitical
conditions and the course of Ukraine's own "European choice strategy" have
created ample opportunities for the shift.

The geopolitical environment that Ukraine finds itself in today has three
parts, said Tedstrom. First, there is Western Europe, which is
characterized by an increasing openness to enlargement. Second, there is
Central Europe, where one can point to a number of outstanding success
stories in terms of post-Soviet transformations that may serve as examples
for Ukraine. The third dimension, said Tedstrom, is Ukraine itself. He
explained that over the past several years Ukraine has distinguished itself
internationally through successful regional cooperation and its
relationship with NATO.

Tedstrom went on to describe the non-security dimension of Ukraine's
present position. Ukraine has thus far been able to avoid the full
financial meltdown that plagued Russia in the second half of 1998. While he
lamented that Ukraine's internal reform has gone very slowly, he predicted
that the ability of Ukraine to keep a steady hand on the macroeconomic
tiller will serve the country well.

Moreover, the Ukrainian government has recently stepped up its commitment
to a "European choice strategy," said Tedstrom. In March 1998 Ukraine
ratified the partnership cooperation agreement with the European Union.
Recently, high-level government and parliamentary committees have been
formed to deal with issues of European integration.

All of these factors, according to Tedstrom, provide the U.S. with a unique
opportunity to make a strategic adjustment in its policy in 1999. Tedstrom
claimed that the NIS context, which is what informs U.S. policy today, does
not have much to offer Ukraine. Ukraine increasingly rejects closer
relations with the NIS or CIS. Moreover, there is no successful example of
reform or state-building for Ukraine to follow in the NIS context, nor are
there resources that can be mobilized within the NIS that would support
Ukraine's reform efforts.

In addition, keeping U.S. policy toward Ukraine within an NIS context sends
the wrong message to Moscow, Tedstrom explained. It illustrates that no
matter what a former Soviet state does as far as cooperation with NATO and
financial stabilization, it will never be considered an emerging European
state.

A strategic adjustment in U.S. policy would move Ukraine forward on reform,
would address concerns of Central European countries that will soon be
members of important European and transatlantic institutions, and would
send a positive message to Moscow about the benefits of transformation,
said Tedstrom. Most importantly, it would acknowledge trends independently
underway in the region.

According to Tedstrom, this strategic adjustment would entail several
policies. The first is largely bureaucratic: in order to change the context
that informs U.S. policy making on Ukraine, the Ukraine desks in U.S.
agencies should eventually be moved from the NIS to the European
department. Secondly, Tedstrom suggested that the U.S. heighten engagement
with Western and Central European countries bilaterally and multilaterally
on Ukraine.

Finally, the U.S. should support high-profile projects that have broad
support within the Ukrainian government, include a Central European
dimension, and encourage Ukraine to undertake reform measures. One example
is the Eurasian Transportation Corridor from Odessa to Gdansk, which is
highly supported in Ukraine and would create jobs for Polish refineries and
encourage Ukraine to move forward with liberalizing its investment laws.

Tedstrom warned that there are two near-term issues that must be resolved
before U.S. policy can be adjusted. The first is Ukraine's relationship
with the IMF. He noted that IMF disbursements had been cut off in the fall
of 1998; negotiations over their resumption are critical. The second issue
is certification. On 18 February 1999 Secretary of State Albright must
certify to Congress that Ukraine has made significant progress in the areas
of economic reform and resolution of certain commercial cases raised by
U.S. investors. Without certification, further assistance to Ukraine will
be curtailed. Tedstrom suggested that a favorable IMF agreement would go
far to help certify the issue of economic reform, but the resolution of
commercial disputes is likely to be difficult.

However, should the IMF agreement and the Secretary of State's
certification be successfully resolved, 1999 presents unique opportunities
for the U.S. in its relationship with Ukraine. Taking advantage of those
opportunities to adjust U.S. policy, concluded Tedstrom, will have
tremendous payoffs over the short and medium term.

Nancy Popson is senior program associate at the Kennan Institute of
Advanced Russian Studies.

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#8
Salt Lake Tribune
February 18, 1999
Editorial
Russia's Y2K Plea
 
  It is hard to resist the thought that the Russians, in tossing out the
idea that Year 2000 (Y2K) computer problems may wreak havoc with
computerized nuclear missile launching systems, are not in part milking
American fears in an effort to get some money out of a Y2K-spooked United
States.

    If they succeed, more power to them. They would not be the first to
profit from another's real, embellished or imagined fears.

    The fear is not that nuclear missiles will launch of their own accord,
but that computer snags could sabotage radar and telecommunications
networks used to detect foreign launches. Radar screens could go blank and
some nuclear systems could be thrown into test patterns.

    Darkly hinted in all this is that without expert assistance and money
-- the Russians estimate they will need $3 billion -- there is no telling
what kind of Y2K problems could emerge.

    The Russian government, like its Chinese counterpart, has not taken the
Y2K threat as seriously as has the U.S. government and some others, which
have been working on it for years.

    "They don't seem to have the same level of urgency that we have had
over it," U.S. Deputy Defense Secretary John Hamre said of the Russians.
His comment understates U.S. Y2K paranoia.

    Many Americans are stockpiling supplies in the event computer failures
cause a breakdown in the transportation and distribution of food, energy
and other necessaries of life. Leaders have warned of these possible
eventualities. Recently, fear was expressed that people dependent on
medical prescriptions need to be able to stockpile their medications.

    Given American fears about Y2K, $3 billion to help the Russians solve
their potential problems may be reasonable. If getting some of these
dollars is part of Russia's motivation, who can blame her. With her economy
in tatters, Russia needs every dollar she can get.

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#9
Globe and Mail (Canada)
February 18, 1999
[for personal use only]
In Poland, East is East and West is West
Most ordinary Poles still resent the years of domination
by Russia, and they look at their entry
to NATO as a guarantee of freedom
By Geoffrey York

Warsaw

Surrounded by his library of 5,000 Russian books, Sergei Stankevich watches
Russian television programs in his Warsaw apartment and dreams of the day
when he can return to his homeland.

A decade ago, he was a comrade of Boris Yeltsin in the fledgling Soviet
democracy movement. When democracy triumphed, he rose to become a Kremlin
aide and a deputy mayor of Moscow.

Today, he is a lonely exile in Poland, a refugee from the ruthless backroom
intrigues of Russia's new elite. He cannot return home without facing
arrest on corruption charges that many observers believe are politically
motivated.

Russia has demanded his extradition, but Poland has refused to hand him
over. Last month, a Polish court ruled that Mr. Stankevich should be given
refugee status because he has a legitimate fear of political persecution in
his homeland.

The ruling symbolizes the deepening alienation of the two Slavic neighbours
and former Communist allies.

For most of the past two centuries, Poland was dominated by Russian czars
and Soviet dictators. Today, as it moves into the West's leading military
and economic alliances, it is increasingly willing to defy Moscow's pressure.

This month, Poland celebrated the 10th anniversary of the negotiations that
led to the collapse of its Communist regime -- an event that helped trigger
the toppling of communism in the rest of Eastern Europe and the Soviet Union.

Yet, while capitalism and democracy take root and flourish in Poland's
booming market economy, Russia is slipping back toward stagnation and
authoritarianism.

"They are going in two different directions," Mr. Stankevich said in an
interview.

"There's a post-imperial syndrome in Russia, and maybe an excessive
pro-Western optimism in Poland. In Russia, reform is an empty slogan.
Russia is becoming less democratic and more autocratic, and the dark forces
of KGB professionals and Communist functionaries are getting closer and
closer to power."

Poland took another step to safeguard its independence yesterday when its
parliament approved the protocols of entry to the North Atlantic Treaty
Organization. Next month, it will officially become a member of NATO,
despite Moscow's strenuous objections.

For most Poles, their long-awaited entry to the Western military alliance
is a guarantee of freedom from Russian domination. They want NATO to keep
its doors open to potential new members in the Baltic states and other
former Soviet republics.

Russia has vowed to draw a "red line" against NATO's expansion into the
territory of the former Soviet Union. One senior Russian defence official
has warned Poland that it would be "committing a historic mistake" if it
supports the Baltic states in their bid for NATO membership. Poland has
flatly rejected this pressure.

Russia also lodged a protest when a Polish-German-Danish army corps was
recently deployed in northwestern Poland. Again, Poland refused to back down.

"It's increasingly obvious that the West is using Poland as its eastern
outpost," Mr. Stankevich said. "This new role is provoking a Russian
reaction. Russia has had to accept Eastern Europe's integration into the
West, but psychologically the Russian elite cannot accept it. There's an
anti-Polish mood among them."

On the economic front, Poland has shifted most of its trade to the West.
Only about 7 per cent of its exports go to Russia, while more than 60 per
cent are sent to the European Union.

Poland has also imposed tight restrictions on traders from Russia and other
former Soviet republics who buy and sell goods in Poland. The new border
controls were introduced last year as Poland prepared to join the European
Union.

Officially, however, Poland's diplomatic policy is to develop friendly
relations with Russia -- especially since Russia supplies 60 per cent of
Poland's oil and 90 per cent of its natural gas.

"Russia is our neighbour, our historical and modern neighbour, and an
extremely important partner to us," Polish President Alexander Kwasniewski
said in an interview. "We wish for relations between democratic Russia and
democratic Poland to be the best they can be. We'd like the policy dialogue
to be active and very open."

But Mr. Kwasniewski insisted that Russia cannot weaken Poland's links to
NATO. "Russians are very aware that this is an irreversible process," he
said. "We expect Russia to understand and accept that Poland is going to
join NATO through our own sovereign decision."

Many ordinary Poles are still resentful of Moscow's traditional dominance
over them.

When Chechen separatist rebels were fighting Russian troops a few years
ago, most Poles were sympathetic to the Chechens, and Polish
parliamentarians criticized Moscow for inflicting "genocide" on Chechnya.

More recently, when they saw Russia's plans for a political merger with
neighbouring Belarus, many Poles worried that Russia might try to revive
its empire.

"There's a phobia that the East is bad and the West is good," said
Stanislaw Filipczak, a Warsaw businessman. "People are fascinated with the
West and there's a hostility to the East. It's mainly because of our past."

Polish foreign minister Bronislaw Geremek visited Moscow last month and
promised that Poland had "no intention of building a wall with Russia."

For more than two years, however, the prime ministers and presidents of the
two countries have not exchanged any official visits. "There are no
high-level visits, and no dialogue on security issues," said Longin
Pastusiak, vice-chairman of the foreign affairs committee of the Polish
parliament.

On military issues, there is a frosty tension between the defence
ministries of the two countries.

"The Poles want the best possible relations with Russia, but Russia doesn't
reciprocate because it has a psychological problem with Poland entering
NATO," said a Western diplomat in Warsaw.

After Poland gave refugee status to Mr. Stankevich last month, the Russian
Foreign Ministry issued a blistering protest.

"The attempts of certain circles in Poland to impart to this criminal case
a political colour, and the lack of legal rationale for the decision of the
Polish authorities, makes one seriously doubtful of their readiness to
conscientiously co-operate," the Russian ministry said.

However, Polish politicians are skeptical of Russia's claim that Mr.
Stankevich accepted a $10,000 (U.S.) bribe from a British company in 1992.
They believe his declaration that the money was payment for a series of
lectures he gave in London.

Mr. Stankevich still hopes to return home some day. But he doesn't think it
will be possible as long as former KGB officers and Soviet apparatchiks
remain influential in Moscow.

"I feel a great potential that's not being used," he said. "I'm angry at
those people who changed my life so drastically."

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#10
Moscow Times
February 18, 1999
DEFENSE DOSSIER: Brass Cool Over Y2K Heat
By Pavel Felgenhauer

As the new millennium moves closer, there is increasing alarm about possible
year 2000, or Y2K, related computer problems in Russia. The Defense Ministry
continually states that the Y2K problem is really not a problem at all. But
Alexander Krupnov, chairman of the Central Telecommunications Commission, said
recently that because of Y2K "we're in a critical situation in several areas,
including the Defense Ministry." Krupnov also said that Russia needs $3
billion to solve Y2K-related problems in the coming several months.

If the money is not forthcoming, terrible things might happen. U.S. officials
have said that Y2K could blank out command computers and panic Russian
officers into suspecting an enemy first strike, thus, in the most extreme
scenario, causing an unintended nuclear launch. Russian nuclear reactors may
explode in a string of new Chernobyls. New Year's Day may turn out to be
doomsday.

Of course, Krupnov is not a military officer and so he may not know in detail
precisely which modifications Russia's top-secret nuclear command and control
and early ballistic-missile attack warning systems need. It's hard to know how
Krupnov calculated the vast sum of $3 billion. Maybe he did not calculate at
all. General Vladimir Yakovlev, the chief of the Strategic Rocket Forces and
its early warning system, said at a news conference last December that the
Defense Ministry will need 10 million rubles (less than $500,000) to solve Y2K
problems. The Defense Ministry price tag on Y2K fixing is 6,000 times less
than Krupnov's. Maybe the $3 billion sum is inflated out of all proportion.

Recently a three-star Russian general told me: "We need to reprogram only 12
to 16 computers in the Defense Ministry's early warning system network. These
computers are essential and also use times and dates in their programs. All
other military computers are either not networked, or not essential, or do not
use dates." The general said that the Russian armed forces have been for
months trying in vain to convince their U.S. counterparts that Russia's Y2K
problems are trivial in comparison with those of the Pentagon.

"We have been telling our American friends that they have over-computerized
their armed forces. If their computers go bust, they will be lost, they will
not be able to fight and defend themselves. We Russians never fully
transferred to computers anything essential in our Defense Ministry."

I personally have never seen a Russian general use a modern computer. Many
Russian generals have desktops in their offices, but they are always switched
off. To give orders Russian generals use telephones, pens and paper. I have
seen Russian majors and colonels use Defense Ministry computers, but usually
they were playing computer games or preparing to print out papers for their
superiors to sign.

Russian military officers neglect their computers because the several thousand
desktops at the Defense Ministry are not networked. These computers can only
be used as intelligent typewriters or play stations. And since all the
generals' typing is done by subordinates, if these desktops go blank next New
Year's, Russian military lines of command and control will hardly be affected.

Last month, U.S. Deputy Defense Secretary John Hamre acknowledged "some
nervousness" in Washington about potential computer problems in Russia. "They
don't seem to have the same level of urgency that we have had over it," he
said. A U.S. delegation has just come to Russia to share information about Y2K
problems. U.S. defense agencies want to place American officers in Russian
nuclear control rooms and Russian officers in American control rooms to
monitor the Y2K changeover.

However, Russian military chiefs say that the Americans have bullied them into
accepting the Y2K mission. "The United States has no information or expertise
to share," one Russian general told me. "In our nuclear command networks we
use old mainframes that our American counterparts scrapped more than 15 years
ago. This Y2K mission is essentially an intelligence gathering operation."

The Russian military will receive the U.S. delegation cordially, but try to
"share" as little true information as possible. Exposing Russia's military
computer backwardness to Americans could undermine the threat potential of
Russia's nuclear deterrent. Instead of improving an already wobbly
partnership, attempts at Russian-U.S. Y2K cooperation have up to now only
enhanced mutual mistrust.

Pavel Felgenhauer is the chief defense correspondent for Segodnya

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#11
Russia-NATO Council Discusses Two Opposing Doctrines

BRUSSELS February 18 [date as received] (Itar-Tass) - The Joint
Permanent Russia-NATO Council on Wednesday [17 February] opened its meeting
over the military doctrine of Russia and the strategic concept of NATO.

  Russian General Staff first deputy chief Colonel-General Valeriy Manilov,
who attended the meeting, said at a news briefing that the meeting was not over
reconciliation of two documents but reciprocal information on their substance.

  In other words, Russia and NATO will not discuss changes to the draft
documents, although coordination of stances and major provisions is feasible.

  This is crucially important, given that we live in the era of partnership
and have the Founding Russia-NATO Act which formally stipulates information
exchange in the field of doctrines, Manilov said.

  He said he had laid out at the Council's meeting Russia's major concerns
which he said could be alleviated at the stage of the drafting of the conceptual
documents.

  The concerns in particular relate to NATO's developing the military
infrastructure in Central and Eastern Europe, admissions of new members, NATO's
meeting its deployment commitments and exchange of information on the military
activity near borders and in oceans.

  These provisions could be laid down in the conceptual documents, which
would make military policies more predictable and reciprocal security higher, Manilov
said.

  He said the Russian delegation sounded rigid enough telling the NATO
partners that Russia retains its stance that any military actions of NATO outside
its area of responsibility must get the UN Security Council's sanctions and
be conducted in conformity with international law.

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#12
Russian defence industries branch out to survive

NIZHNI-NOVGOROD, Russia, Feb 18 (AFP) - The Sokol factory in
Nizhni-Novgorod makes one of the best jet fighters in the world, the
MiG-31, but in today's dismal economic climate, survival means also doing
repairs to the city's fleet of trolley buses.
  "We take any orders which provide work to our personnel. We repair
trolleybuses for the city and we are even contemplating producing them,"
said Vassily Pankov, the director of Sokol, a mainstay of the Russian
aeronautical industry.

For the past five years, because of a massive cut in the Russian military
budget, Sokol has received no orders from the state which in Soviet times
assured the prosperity of the country's huge defence industrial complex.

"Neither have we received the least financial aid to fund our conversion to
civilian production after military orders were slashed," Pankov said.

In the Soviet era up to 1991, about 100 scientific institutes and as many
companies - 30 percent of the region's industry - worked for the defence
sector.

Today, Sokol's salvation comes mainly in the form of orders from abroad.
This year, Sokol is counting on a contract worth 300 million dollars signed
with India to modernise 125 MiG jets and on opportunities to export the MiG-31

As part of its conversion to civilian production, Sokol has begun making
amphibious engines, aircraft for fire-fighting and a plane designed for
businessmen, freight transport or emergency evacuations, called the Gzhel.
However mass production of the Gzhel will depend on support from investors
who have yet to materialise.

"We had started to produce the Gzhel with 15 million dollars invested by a
Russian bank. But the bank collapsed during the crisis of last August. To
continue production, we need nine million dollars which the bank was
supposed to provide us with," Pankov said.

The Sokol director said he hoped this year to sign a 200 million dollar
contract with the Italian firm Aermacchi based near Milan, to build the
fuselage and wings of about 15 aircraft.

He is also looking at offers from outside the aeronautical sector and is
hoping to sign a contract this year worth 70 million dollars with a western
firm which would sub-contract to Sokol the production of household appliances.

In a move marking the final break with the hush-hush world of military
secrecy which defined Sokol for decades, the firm is now offering
thrill-seekers the opportunity to fly in a MiG-29, a two-seeter jet used to
train Russian fighter pilots. The planes piloted by an experienced test
pilot,take off from an airfield inside the Sokol complex.

For amateurs of such sensations, flying at twice the speed of sound will
cost them 6,000 for an hour. But for the 12 or so wealthy westerners who
have already gone up, the experience was apparently worth it.

This kind of luxury is not for Sokol workers however whose average wage of
580 rubles (26 dollars) was paid, generally four months late last year.

Last year, 1,800 people left the factory; 600 were sacked and part of the
6,000 others were left redundant for several months for lack of work. The
management today says it may have to fire between 1,000 and 1,500 people.

"The worst is over but it is obvious that all the problems are not yet
behind us," Pankov said.

Some vestiges of Soviet times survive at the Sokol factory. Portraits of
Lenin, communist slogans, hammers and sickles still adorn the walls of the
buildings - forlorn reminders of a time when Nizhni Novgorod, then known as
Gorky, was a pillar of the Soviet arms industry.

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Jamestown Foundation Monitor
18 February 1999

WEEKLY REPORTS THAT BEREZOVSKY'S ARREST IS IMMINENT. The anonymous
investigator from the Prosecutor General's Office, who spoke with
"Moskovskie vedomosti" about Yuri Skuratov's resignation as chief of that
office, also said that financier Boris Berezovsky's arrest is imminent.
According to the official's account, the search earlier this month of the
offices of Sibneft--the giant oil company reportedly controlled by
Berezovsky--yielded evidence of close links between Roman Abramovich,
Sibneft's general director, and the Yeltsin family, and included "a
photograph of Abramovich openly kissing the president's daughter, Tatyana
Dyachenko." Last year, Aleksandr Korzhakov, who once headed Yeltsin's
presidential security service, claimed that Abramovich was the Yeltsin
family's "cashier." Investigators reportedly also found US$8 million in
Abramovich's safe, "along with several files of compromising material,"
aimed at, among others, Moscow Mayor Yuri Luzhkov.

"Moskovskie vedomosti" quoted the investigator as saying: "Berezovsky will
not be at liberty much longer. A warrant for his arrest has already been
drawn up. Moreover, at least five other major operations against corrupt
officials are in the pipeline for the very near future. Even all these
things put together, however, represent just a tiny proportion of what could
be done in principle. We have too many highly placed people in this country
who are, to put it bluntly, 'dirty'. When relevant documentation came into
my hands and those of other former Prosecutor-General's Office members of
staff a while ago, we were shocked--it was simply horrendous. If the
documents were to be believed, there was hardly a single 'clean' person left
in the top echelons of power. Virtually the only exception is Prime Minister
Yevgeny Primakov." The weekly said that the "purges" currently under way are
the work of Deputy Prosecutor-General Mikhail Katyshev, who is known to be
an ally of Viktor Ilyukhin (Moskovskie vedomosti, February 16-22).

The Prosecutor General's Office denied that an order for Berezovsky's arrest
had been signed, calling the report a "provocation" (Center TV, February 16).

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#14
Citizens Keeping $40 Billion 'in Their Socks'

Moskovskiy Komsomolets
17 February 1999
[translation for personal use only]
Article by Aleksey Borisov and Nina Moskvina: "Debts in Our Socks; Russia
Again Trying To
Seduce IMF, Forgetting Its Own Reserves"

   There is a crisis in Russia. Only three years ago Western experts were
seriously discussing whether the Russian economy would be able to "digest"
$300 billion in investments or not. Now more than ever the financial system
needs an influx of "new blood." But there is none. Finding donors is increasingly
difficult. The volume of infusions has been almost halved -- from the estimated
$9.3 billion to the real $5.9 billion.

   Russian banks do not feel charitable now. They themselves would like to
be able to make ends meet. Private investors are ignoring the banks. They are
knowledgeable now. Theybelieve only in their own socks. Over the fall the banks
lost a pile of money. According to the figures of the Association of Russian Banks
the total reserve capitals were the smallest in the past five years -- 50 billion rubles [R].

   I remember the government once intend to give material aid to
enterprises from the budget's pocket. Within the framework of the large budget a
small budget was created -- the development budget. But it turned out to be small
indeed.

   For next year the development budget will probably be about R22 billion
(slightly over $1 billion). Knowing our deputies' appetites we may suppose that nothing
will be left of these billions. Nevertheless Economy Minister Andrey Shapovalyants
stated in all seriousness that the volume of government guarantees for investments this
year will be R50 billion.

   According to the minister these will not simply be papers with a fine
stamp. They "will be backed up by payments from the federal budget." Aleksandr Zhukov,
chairman of the State Duma Budget Committee, believes that the likelihood that the draft
budget for 1999 submitted to the State Duma by the government can be assessed at about
10 percent. In other words all the above can be divided by 10. Thus we should not count on
our own resources. Russia is not Munchausen. It cannot drag itself out of the swamp by its
own hair.

   Two very large economic forums were held in January: in Davos in
Switzerland and Harvard in the United States. Of these two gatherings of world financial
experts the more important one for Russia was the less publicized Harvard meeting. The
largest wallets were gathered there: 600 of the world's largest companies, investment funds,
and banks, and leaders from the World Bank, the European Ban, and the IMF. While in Davos
the Russian delegation was merely listened to politely, in Harvard they promised money. But only
after a brush-off from the IMF, which has adopted a wait and see position. One can understand
the IMF: Russia owes it about $9 billion. Moreover, the IMF has just felt a blow below the belt --
the Brazilian crisis and the collapse of the South Asian stock markets, which cast doubt on the
correctness of reforms according to the IMF formula.

   Meanwhile the IMF is silent. But this silence is becoming menacing.Counting on boosting Russian
production without investments is like waiting for the second coming. Russia's state budget is of no
help here. The crisis has thrown the Russian economy back to its 1994 positions. Our Gross Domestic
Product has never been large. That is true now more than ever. Here only one third of what is produced
is up to contemporary standards. It is shameful even to count the rest.

   The forthcoming year will show what the final solution of the investment issue will be.
Perhaps we will get help from abroad. But it is nonetheless better to pin our hopes on
ourselves. Aleksandr Livshits has told Moskovskiy Komsomolets that citizens have about $40
billion in their possession. To avoid any current financial problems in 1999 it would be
enough to have $5-6 billion. Or one seventh of the reserves "kept in socks." Or one third of that
amount to be able to forget the financial crisis entirely. Consequently it is merely a
question of regaining people's faith in the state. But that is in fact
hardest of all.

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