CDI Russia Weekly

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Edited by David Johnson
ISSUE #17October 2, 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. St. Petersburg Times: John Varoli, TB's Deadly Touch a Growing Russian Reality.
  2. Moscow Times: Pavel Felgenhauer, DEFENSE DOSSIER: Kosovo Raid Is Non-Starter.
  3. BBC: Moscow mayor: 'IMF loans throw money in fire.'
  4. The Globe and Mail (Canada): Geoffrey York, Red Cross appeal.
  5. Cleve Gray: Report on All-Russian Party of Pensioners.
  6. Moscow Times: Gary Peach, Cabinet Floats Soviet-Style Crisis Plan.
  7. RFE/RL: Ben Partridge, Russia: Soviet Era Labor Camp System Verges On Collapse.
  8. Komsomolskaya Pravda: Interview with Foreign Minister Igor Ivanov.

    #1
    St. Petersburg Times
    September 29, 1998
    TB's Deadly Touch a Growing Russian Reality 
    By John Varoli
    STAFF WRITER
    

    Tuberculosis of the eye? Of the bones?
    
    People accustomed to thinking of TB as just a dreaded lung disease should
    think again.
    
    According to tuberculosis experts in St. Petersburg, only 80 percent of TB
    cases in fact affect the lungs. The other 20 percent strike, exclusively,
    other parts of the body, including eyes, genitals, skin, bones and intestines,
    among others. 
    
    "Many people don't know that TB can infect all these organs," said Dr.
    Svetlana Sanayeva, head of the eye department at the City Tuberculosis Center,
    the main tuberculosis hospital in St. Petersburg's system of health care
    institutions dedicated to combating and treating the disease. "In Russia, we
    can diagnose all these forms because our knowledge of the problem is more
    advanced than in the West. We have been studying the problem longer and it is
    more severe here."
    
    The problem of TB is truly more severe in Russia than in the West. Though TB,
    if treated properly, is curable in 95 percent of cases, about 25,000 Russians
    - potentially one out of every six TB sufferers - die annually from the
    disease, according to Goskomstat, the state statistics agency. Worldwide,
    tuberculosis still kills close to 3 million people a year, primarily in Asia
    and Africa. 
    
    TB has come to be thought of as a social disease, flourishing in areas of
    structural and economic crisis where there is poverty, overcrowding,
    alcoholism, and homelessness. 
    
    This makes Russia a perfect breeding ground for the highly contagious disease,
    which has continued to spread unabated throughout the country over the past
    decade. 
    
    "The problem is certainly getting worse in Russia," said Tine Demeulaere, the
    head of the Russian branch of Médecins Sans Frontières, an international non-
    government organization which provides medical assistance to countries in
    
    crisis. "Since 1991, there has been a 10 percent increase each year in the
    number of TB cases."
    
    In 1995 the number of Russians infected with TB approached 150,000 according
    to an estimate by the World Health Organization. Some estimates now put the
    country's TB-infected prison population alone at that number. 
    
    Even more disturbing is the rapid spread of a multi-drug-resistant form of the
    disease, known simply as MDR TB, first diagnosed in the early 1970s but five
    years ago recognized as a threat to public health. Today about 20,000 Russians
    are infected with MDR TB, the spread of which is attributed to the improper
    use of standard TB medication. 
    
    "As a minimum a TB patient should be treated with four types of medicines, but
    because many hospitals do not have enough money, they only treat patients with
    one or two medicines," Demeulaere said. "Half the treatment cannot kill off
    all the bacteria, and these then multiply and mutate into the MDR type."
    
    "Either you treat patients properly, or you don't do it all," she added. "But
    most Russian doctors can't stand by and watch patients die, so they think that
    it is better to administer at least some medicine, which only fosters the more
    virulent MDR."
    
    Demeulaere predicted that MDR TB will soon start to appear on Western shores
    with greater frequency. "The potential is enormous for an outbreak in the
    West, and people are not waking up to the threat," she said.
    
    Although MDR is curable, Demeulaere said, the $2,000 to $8,000 price tag for
    an 18-month treatment program is prohibitive for Russia's impoverished health
    care system, making the new strain effectively incurable. 
    
    In the West, full treatment can cost about $200,000 per case. But New York,
    which had an outbreak of MDR in 1991 with 600 cases reported, was forced to
    spend over $1 billion, to treat the stricken as well as to initiate
    prophylactic measures to prevent the disease's reappearance amongst those
    segments of the population most at risk.
    
    Russia's TB territory is Siberia, where rampant poverty, bad health conditions
    and its large population of current and former prisoners have all contributed
    to creating fertile conditions for the disease's spread. 
    
    In fact, the prison system is Russia's worst TB offender, accounting for the
    vast majority of the country's cases. Ten percent of Russia's approximately
    1.2 million prisoners have contracted the disease - 18,000 of whom have MDR
    TB. 
    
    Demeulaere, who heads MSF's TB prison program, personally treats nearly 1,000
    tuberculosis-infected inmates in the Siberian region of Kemerovo, where she
    spends one week out of every month. 
    
    "The situation in prisons is indeed grim," she said. "They have infection
    rates of 32 to 100 times higher than in civil society, primarily because less
    treatment is available. Other factors include the overcrowding so typical of
    Russian prisons, poor food, high stress of prison life, as well as the fact
    that high-risk groups tend to end up in prison more often."
    
    While abysmal prison conditions further the spread of the disease, prison
    officials have protested that the situation is exacerbated by the fact that
    Russian prisons are traditionally used as a drop-off point for many who are
    
    already ill. 
    
    "Prisons are a sponge that society uses to wipe its face clean of social
    dirt," said Mikhail Perin, the chief medical officer for Russia's prison
    system. "Those who end up in prison are often the dregs of society, various
    alcoholics and drug addicts and other people who have lost their family and
    societal ties. It is precisely they who are infected with TB."
    
    For instance, Perin said, nearly 60,000 convicts entered the prison system
    with TB in the past two years alone. He added that the total number of TB-
    infected inmates has increased from 35,000 in 1993 to 90,000 in 1998.
    
    St. Petersburg, meanwhile, has fared better keeping its TB problem under
    control, with the number of new cases declining slightly from 40 per 100,000
    in 1994 to 38 in 1997, according to the city Health Care Committee. The total
    number of cases is just under 2,000.
    
    Part of the reason for the city's success in battling the problem may be the
    extensive system of institutions St. Petersburg employs to keep its TB problem
    in check. In addition to a network of TB dispanseri, or drop-in clinics,
    located in each district, the city has four hospitals, with a total of 2,500
    beds, dedicated solely to curing those ill with TB. 
    
    On top of this, the city has its own TB medical research center, and a whole
    separate care and treatment network for children, including a TB kindergarten.
    
    According to Vladimir Zhemkov, head doctor at the City Tuberculosis Center, TB
    is in fact not as infectious as many believe. 
    
    If an infected person comes into contact with 100 people, then over the course
    of a year, only 12 to 16 of them will develop the disease, Zhemkov said. The
    others might carry it without ever developing symptoms, as long as they remain
    healthy.
    
    Unlike many other regions and prisons, St. Petersburg is reasonably funded and
    equipped to fight the disease. The non-profit sector has also begun to tackle
    the problem. 
    
    In early September, Russia's only soup kitchen for homeless people infected
    with TB opened in the city. Run by the Catholic charities Caritas and the
    Maltese Knights Social Services, the kitchen feeds 150 people every day. 
    
    "We noticed that many of the homeless coming to our other homeless soup
    kitchen were TB-infected, and when the local government wanted to close it
    down we reached an agreement to create a special TB soup kitchen for the
    infected," said Father Hartmut Kania, who directs the project.
    
    Since part of the problem of treating TB is that about four medicines must be
    administered regularly over a period of about nine months, the vagrant
    lifestyle of the city's homeless makes this almost impossible. 
    
    With the soup kitchen, however, it is hoped that the homeless will go there
    regularly and be treated by state health care workers who will be able to
    monitor and administer the full nine-month course of treatment.
    
    
    Back to the top

    #2
    Moscow Times
    October 1, 1998 
    DEFENSE DOSSIER: Kosovo Raid Is Non-Starter 
    By Pavel Felgenhauer
    Special to The Moscow Times
    

    A UN Security Council resolution on Kosovo that was passed last week has
    drastically increased tensions in the region. The resolution called for a
    
    cease-fire in Kosovo, and threatened further action if fighting continued.
    But
    the resolution did not explicitly authorize member states to intervene
    militarily in Kosovo. 
    
    Still, in the West many believe that the go-ahead has finally been given and
    the North Atlantic Treaty Organization is actively preparing for military
    intervention in Serbian sovereign territory. However, the geographically most
    important member state f Italy f has not yet fully decided what to do. 
    
    An effective NATO air offensive against Serbian forces in and around Kosovo is
    impossible without the use of Italian air bases and airspace. Macedonia is
    reluctant to support a NATO enforced solution of the Kosovo problem, its
    government fearing that the defeat of the Serbs in Kosovo will in the end
    create a "greater Albania" that might try to annex parts of Macedonian
    territory. Greece, although a member of NATO, is equally suspicious of the
    Albanians and will hardly volunteer to be the main base of NATO attacks
    against the Serbs. 
    
    Albania is eager to help the West hit Serbia. But Albania is a lawless country
    ruled by feuding warlords, and in any case does not have any modern
    infrastructure to support and supply a modern NATO task force. 
    
    Of course, an attack on Serbia can be mastered not from Italy but from
    aircraft carriers and warships carrying cruise missiles out at sea. But then
    instead of an allied effort the exercise of force in Kosovo would turn into an
    exclusively U.S.-performed operation, which is politically unacceptable. 
    
    So while the Italians are hesitant, the whole Kosovo military adventure
    remains in limbo. 
    
    The Italian government already stopped one NATO attack last summer. In June,
    NATO officials also said that they were "set to bomb" targets in Kosovo, but
    the Italians flatly rejected an American offer to go into action with a group
    of "volunteer" NATO members f the United States, Britain, Germany and some
    other smaller partners. The Communist-supported coalition government in Rome
    demanded a precise UN Security Council resolution legalizing an attack, so the
    United States backed down. Washington does not wish to seek any Security
    Council endorsement, so as not to give Russia even the semblance of having
    veto power over NATO actions. 
    
    In time, however, the Italians can be persuaded. A NATO air offensive in
    Kosovo will hardly meet any serious Serbian resistance. The rump Yugoslavia
    has, officially, more than 200 combat aircraft and armed helicopters, but most
    of them are old, unmodernized Mig-21s and local-made trainer/attack low-speed
    plans. The Serbs have no more than 14 Mig-29 fighters, which were purchased in
    the 1980s and have not been modernized or properly maintained since. The Serbs
    also have more than 100 anti-aircraft missiles that are equally outdated. 
    
    Serbian air defenses are structured and equipped in the same fashion as the
    Iraqi forces before operation Desert Storm in 1991. But the Iraqi air force in
    1991 was almost 10 times stronger than the Serbian one today. NATO will
    achieve full air superiority at the first hour of the first day of any
    offensive in Kosovo. Yugoslav President Slobodan Milosevic has for many years
    
    neglected his armed forces and put all available resources into his special
    police force. The Serbian police have quelled unrest in Belgrade and kept
    Milosevic in power, and are now successfully engaged in the extermination of
    Albanian separatists with the Yugoslav army providing air and artillery
    support. But how could Milosevic's thugs cope with NATO jets? 
    
    Nevertheless, NATO air superiority over Kosovo would be in many respects
    meaningless, because there are not many important military targets to attack
    and NATO would hate to become "the Albanian separatists' air force," giving
    them air support in this or that clash with the Serbs. So if a NATO offensive
    begins it will be mostly targeted not at Kosovo per se, but at military
    targets in Serbia proper, including the Belgrade region. 
    
    Militarily speaking, only an extended offensive makes any sense, if NATO
    indeed hopes to force Milosevic to his knees. In Moscow, however, such an
    attack will be seen as ample proof of NATO's overall aggressive intentions.
    Communists and nationalists will cry out that Mother Russia is next in line
    for attack and many Russians, stunned by the collapse of their Western-
    oriented quasi-market economy, will believe them. 
    
    Pavel Felgenhauer is the defense and national security affairs editor of
    Segodnya. 
    
    
    Back to the top

    #3
    BBC
    September 30, 1998 
    Moscow mayor: 'IMF loans throw money in fire'
    

    Mr Luzhkov is widely thought to be a potential presidential candidate 
    
    The Mayor of Moscow, Yuri Luzhkov, has strongly criticised both the
    International Monetary Fund and the Russian authorities for their handing of
    Russia's economic crisis. 
    
    He said the IMF's loans had been "throwing money into the fire". 
      
    Speaking during a brief visit to London, Mr Luzhkov also told Western
    investors to do business with the Moscow municipal authorities instead of the
    Russian Federation. 
    
    He said the failings of the Russian Government contrasted sharply with the way
    Moscow was handling its own affairs and that his city's economy was far
    healthier than the rest of Russia. 
    
    Correspondents say Mr Luzhkov's comments amount to a carefully worded call for
    economic devolution in Russia. 
    
    Autonomous region 
    
    He said that Moscow - an autonomous region, with its own budget and government
    - was not defaulting on its financial and other obligations to its business
    partners. 
    Mr Luzkhov says Russia can learn from Moscow's successful business policies 
    "We are ready to produce every penny of the money we owe, including interest,
    on demand, because we put the money into specific, profitable projects, and
    not into treacherous treasury bonds," he said. 
    
    On Tuesday, the new Prime Minister, Yevgeny Primakov, gave a stern warning to
    regional leaders not to seek too much economic independence. 
    
    Mr Luzhkov himself was careful to state that he would not be seeking authority
    to set taxation levels in Moscow - the issue most sensitive in the increasing
    struggle between the centre and the regions. 
    
    He said Moscow's successful policies could be effectively extended to the rest
    of the country. 
    
    
    Presidental prospects 
    
    Mr Luzhkov also gave strong hints that he is interested in running for the
    Russian presidency in the year 2000. 
    
    He said he would run for the post if the candidates that came forward did "not
    hold the statesmanlike positions necessary" to ensure Russia's stability and
    progress. 
    
    Mr Luzhkov is in Britain as the guest of the British Labour party to attend
    it's annual conference. 
    
    He said he had told UK Prime Minister Tony Blair that it was time to form a
    new Russian left-of-centre party committed to a market economy and social help
    for the needy. But he refused to say whether he intended to lead such a party
    himself. 
    
    Although he has said he does not wish to leave his position as Moscow's mayor,
    it is widely believed that Mr Luzhkov will be a candidate for the presidency
    and some see his visit to Britain as an attempt to raise his profile. 
    
    
    Back to the top

    #4
    Date: Thu, 01 Oct 1998
    From: Geoffrey York (york@glas.apc.org) ls.com>)
    Subject: Red Cross appeal 
    
    By Geoffrey York
    The Globe and Mail (Canada)
    Oct. 1, 1998
    

    	MOSCOW -- The Red Cross, launching an emergency appeal, has warned that
    Russia is facing a looming catastrophe that could eventually lead to
    mass starvation and a tidal wave of refugees.
    
    	Russia’s economic crisis, triggered by the collapse of the ruble and
    the banking system, could produce an urban disaster and the worst winter
    in a generation for millions of ordinary Russians, the Red Cross said
    yesterday.
    
    	Meanwhile, the International Monetary Fund predicted yesterday that
    Russia’s economy will decline by 6 per cent in 1998 and 1999, sending it
    back into a deep recession after slight growth last year.
    
    	The crisis has already led to soaring inflation, panic buying, a halt
    in imports and a huge rise in unemployment. But the effects will be
    compounded by a poor harvest and the aftermath of droughts and floods in
    some regions, the Red Cross said.
    	
    	"We can’t exclude the possibility of mass starvation if the situation
    continues to deteriorate," said Borje Sjokvist, head of the Moscow
    delegation of the International Federation of Red Cross and Red Crescent
    Societies.
    	
    	"We fear that it might be the hardest winter in a generation. Old
    people are making comparisons to the tough winters of the 1940s, during
    the Second World War."
    
    	He noted that the Russian potato harvest has been damaged by heavy
    rains, a serious blow to a country that depends on potatoes for 10 per
    cent of its caloric intake. "Potatoes are rotting and family stocks
    might be lower this year," Mr. Sjokvist said. "What will happen in
    January and February? We could have an urban disaster."
    
    	The Red Cross Federation is appealing for $15-million (U.S.) in
    emergency aid to provide food and clothing for 1.4 million vulnerable
    people in Russia this winter. The target is three times greater than the
    amount it collected in an appeal last winter. Emergency aid is also
    being sought for Ukraine, Belarus and Moldova.
    
    	An assessment in mid-September by teams of Red Cross workers concluded
    that many Russians are "suffering from stress and fear because of
    constant price rises for basic consumer goods and medicines." Thousands
    
    of people are genuinely afraid that they will not survive the winter,
    and many have been unable to stock food for the winter because of unpaid
    wages and pensions, the assessment found. Some regions are desperately
    short of fuel for winter heating, it said.
    
    	The Red Cross is also appealing to the self-interest of Western
    countries near the Russian border. "Given the proximity of some
    vulnerable regions to neighbouring countries, there might be a fear of a
    major population movement ... across borders or across the Baltic Sea,"
    Mr. Sjokvist said.
    
    	While the vast majority of the Red Cross fund-raising will be done
    outside Russia, the agency is hoping to collect 4 per cent of its target
    from Russian businesses and wealthy Russians. But there is no tradition
    of private charity in Russia, and a similar appeal last year was a
    dismal flop. Only about $2,000 (U.S.) was raised from Russians last
    year.
    
    	Another obstacle is the wounded pride of many Russians when they see
    foreigners donating money. After last year’s Red Cross appeal, a Russian
    newspaper responded with a scornful headline: "In Geneva they think we
    can’t survive our own winter." Yesterday the Red Cross took pains to
    assure the Russian media that it isn’t questioning the country’s
    capacity for survival.
    
    	Perhaps the biggest problem, however, is the hostility and suspicion of
    Russia’s customs officials, who are reluctant to allow donated goods to
    enter the country without customs duties. Truckloads of donated food are
    sometimes blocked at the border for weeks or months.
    
    	In one region, the customs officials launched a criminal investigation
    because some of the donated clothing was new, rather than second-hand.
    In another region, the officials ordered a shipment of toys to be
    destroyed because it wasn’t included on a shipment list. "They made us
    burn the toys at our own expense," said Lyudmilla Potravnova, chairwoman
    of the Russian Red Cross. "People were standing and crying when they saw
    toys being burned."
    
    	As the economic crisis continues, trade unions are predicting that
    millions of Russians will join a national day of protests and strikes
    next Wednesday.
    
    	Hundreds of nuclear researchers and other scientists held
    demonstrations yesterday on highways outside Moscow, delaying traffic on
    some roads. Employees of the Russian space mission control centre, near
    Moscow, were among those affected by the pickets.
    
    	University students are planning to stage protests today, and teachers
    are holding demonstrations on Monday.
    
    	In Moscow alone, about 150,000 people have lost their jobs and 30,000
    small and medium-sized businesses have closed their doors because of the
    economic crisis, a city official said yesterday.
    
    	According to a recent opinion poll, only 8 per cent of Russians say
    they have been unaffected by the crisis.
    
    
    Back to the top

    #5
    Date: Thu, 01 Oct 1998 
    From: Cleve Gray (clevegra@cdi.org) 
    Subject: All-Russian Party of Pensioners
    
    SUMMARY OF PANEL DISCUSSION WITH LEADERS OF THE RUSSIAN PARTY OF PENSIONERS
    AND THE RUSSIAN NATIONAL COMMITTEE FOR THE UNITED NATIONS INTERNATIONAL YEAR 
    OF THE OLDER PERSON
    
    
    WASHINGTON, D.C., September 30 - The Center for Eurasian, Russian and East
    European Studies at Georgetown University presented a panel discussion this
    week entitled, "Russia’s Gray Panthers?  Deteriorating Conditions for Russian
    Pensioners and their Rising Political Role ­ A Look at the Next Elections and
    Beyond."  In attendance were Sergei P. Atroshenko, Chairman of the Russian
    Party of Pensioners, Vladimir N. Chernavin, Retired Admiral and
    Commander-in-Chief of the Soviet Navy, and Iakov P. Riabov, USSR Ambassador to
    France from 1986 to 1990 and currently the President of the Association for
    Development of the Urals Region.  The delegation was invited to speak in the
    United States by the Association of American Retired Persons, or the AARP.
    
    Sergei Astroshenko began the discussion by saying that there is no democratic
    society in Russia.  The democratic institutions exist, but a democratic
    society does not, he said.  Nor is there a middle class.  It is estimated that 7.6% of
    the Russian population owns 92% of the wealth within the country.  In
    resolving the current crisis, a middle class "must be created," Atroshenko 
    said.
    
    The current political parties in Russia are only interested in their own
    problems, not the problems of the Russian Federation, according to
    Atroshenko. 
    
    One of the problems Atroshenko referred to is the treatment of pensioners
    within the Russian Federation.  Currently, 38 million people of pension age
    are living below the subsistence level in Russia, which is currently 500 
    rubles per month, or approximately 35 dollars.  The average wage of an 
    agricultural worker in Russia is approximately 420 rubles per month.  It is 
    unacceptable, Atroshenko said, that a 55-year-old woman will be receiving 20 
    dollars per month for the rest of her life.  The needs of the elderly must be 
    addressed by the Russian government because "the fact is we will all be 
    pensioners.  Not one politician has addressed the welfare of pensioners," 
    Atroshenko said, and this has led to the formation of the All-Russian Party 
    of Pensioners (RPP), which was founded at the end of 1997 and registered by 
    the Ministry of Justice of the Russian Federation on May 29, 1998.
    According to the party’s Working Theses for the Delegation of the Russian
    Party of Pensioners, the main goal of the RPP is
    "to convert the Russian pensioners from a potential political force into an
    actual one."
    
    The potential of the pensioner population within Russia is enormous.  In the
    1995 Seratov gubernatorial elections, for example, only 34% of the population
    voted.  Of that 34%, 24% were pensioners.  The pensioners, therefore, were the
    group who elected the governor.  "This may be applied to the entire country,"
    Atroshenko said.  By November of 1999, Atroshenko wants to have a party of one
    million that will fight to create a "civil society" which can then create
    answers to the pensioners’ problems.  
    
    The Party has five core economic demands, shown below
    
    (a)compensation for savings deposits lost during the Gaidar reforms of 1992; 
    (b)pensions commensurate with lifetime work contributions to the Russian
       State;
    (c)housing and utility costs commensurate with pension benefits; 
    (d)provision of appropriate health care services; and 
    (e)an end to age discrimination in and outside of the workplace. 
    
    
    Admiral Vladimir N. Chernavin said that retired military personnel will
    support the Russian Party of Pensioners.  The slogan of the party has become
    "Pensioners of the World Unite!", he said.
    
    Ambassador Iakov P. Riabov continued by saying, "The wealth of any nation
    depends on the state of health of its agriculture and manufacturing.  If
    industry grows, then trade will increase.  If trade increases, then there will
    be more cash flow.  This creates money for wages and affects the wealth of the
    nation and the individual."  Riabov then offered some statistics to
    demonstrate the economic crisis in Russia.  In the last 8 years, he said, 50% of Russia’s
    manufacturing capacity and 48% of its agricultural capacity has been lost. 
    Riabov called this a complete crisis, socially, politically, and
    economically. 
    
    Capital investment, he went on, has fallen to 28% from a level of 100% in
    1990.  $300 billion is injected into Western economies each year.  The
    accumulation of debt in Russia is so high that new financial aid from
    international financial institutions is unwanted, Riabov said.
    
    The situation in Russia today has created a prevalent mood of nostalgia among
    pensioners.  It is now common knowledge that workers have not received their
    wages for months.  Many pensioners are now left to think, In the Soviet
    Union, we were always paid our wages on time.    
    
    Cleve J. Gray
    Research Intern
    Center for Defense Information 
    1779 Massachusetts Ave, NW
    Washington, D.C. 20036
    
    
    Back to the top

    #6
    Moscow Times
    October 2, 1998 
    Cabinet Floats Soviet-Style Crisis Plan 
    By Gary Peach
    Staff Writer
    
    The Russian government convened behind closed doors Thursday to work out a
    rescue plan for the Russian economy, considering a return to tight state
    control over foreign trade, prices and currency exchange rates. 
    
    Prime Minister Yevgeny Primakov said there were currently six versions of the
    economic program, but only one was made available to the public Thursday. A
    draft program attributed to First Deputy Prime Minister Yury Maslyukov was
    published in the business newspaper Kommersant Daily. 
    
    ORT television reported that it was this option that dominated the debate in
    Thursday's session, though Primakov denied it and said there was as yet "no
    program." 
    
    "Right now we are talking about a system of measures," Primakov said
    enigmatically. "These measures will establish the starting principles for the
    government's future economic program." 
    
    The document published in Kommersant contained some measures that alarmed both
    economists and ordinary Russians. The draft called for banning banks from
    selling foreign cash to the public, preventing Russians from keeping their
    savings in dollars. 
    
    Other measures in the Kommersant document were also reminiscent of tough
    Soviet-era economic controls. 
    
    The plan, for example, calls for the government to select which companies will
    be authorized to participate in export and import operations. 
    
    
    The exchange rate of the ruble, the program says, should be set by the Central
    Bank based upon Russia's balance of payments, gold and currency reserves, and
    the level of inflation. 
    
    "This definitely seems like turning the clock back a bit," said one Western
    analyst who asked not to be named. "It is the first stage towards the
    suspension of currency convertibility." 
    
    The plan calls for controlling prices on basic staples and propping up defense
    industries, both measures that have been favored by the Communists since
    before the Soviet Union broke up. 
    
    The implementation of the program would seriously threaten the independence of
    the Central Bank. It would have to hand over 100 percent of its annual profits
    to the budget, in comparison to 50 percent at present, and commercial banks
    would no longer be allowed to maintain accounts in foreign banks abroad. 
    
    The refinancing rate, a crucial factor in controlling the nation's monetary
    policy, and which is normally set by the Central Bank, would be established by
    a new organ, the Committee on Coordination of State Financial Institutions,
    which will be made up of representatives of the Central Bank, the Ministry of
    Finance, the Economics Ministry, the Federal Securities Commission, Sberbank,
    and Vneshtorgbank. 
    
    A central issue in the draft program, which alarmed economists the most, was
    the potential for soaring inflation. In several different parts of the
    document there are open provisions for the issuance of unsecured cash into the
    economy. 
    
    The publication of the draft in Kommersant caused an uproar both in the
    government and the media, with information agencies running details and
    analysis of the plan all day Thursday. Primakov was eventually forced to make
    an impromptu appearance before journalists. He downplayed the Kommersant
    document and said it should not be attributed to Maslyukov. 
    
    Analysts, however, were mistrustful of Primakov's denials and said the
    program's approach was easily explained by Maslyukov's past as chief of
    Gosplan, the Soviet Union's central planning agency. 
    
    "We did not expect anything radically different from this government," said
    Kingsmill Bond, head of research at Deutsche Morgan Grenfell. 
    
    In any case, analysts warned that the published program should be taken with a
    grain of salt, as the draft is liable to undergo multiple changes and
    amendments. 
    
    "I don't think this is the final version of the program. I know for sure 
    
    they were still writing things in last night," commented Andrei Neshchadin,
    director of the Expert Institute. 
    
    Besides, Neshchadin said, "Most of what this plan says about taxes, social
    measures and the banking sector just isn't up to the government. It's not even
    the government's business." 
    
    The Central Bank, for instance, is still an independent government
    organization that can refuse to issue inflationary credits to any sector in
    the economy. The only real influence the government has on the Central Bank
    and its chairman Viktor Gerashchenko is political persuasion. Setting taxes,
    according to the Russian constitution, is the sole prerogative of the
    parliament. 
    
    
    According to some economists, if parts of the draft program are implemented
    temporarily, their effect on the economy might not be disastrous. For example,
    the draft calls for exporters to sell an additional 25 percent of their
    foreign currency earnings directly to the Central Bank and for tough controls
    against capital flight. 
    
    "These measures do everything possible to push up the hard currency reserves,
    which is what the government needs most to avoid complete default,"said
    economist Ralph Sueppel of J.P. Morgan. The Central Bank announced Thursday
    its dollar reserves had grown to $12.4 billion from $12.0 billion on Sept. 18.
    
    "The danger may come if in a few months the situation stabilizes and everyone
    thinks these measures are good measures," Sueppel said. "There is nothing in
    the plan saying they are temporary."
    
    
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    #7
    Russia: Soviet Era Labor Camp System Verges On Collapse
    By Ben Partridge
    
    London, 1 October 1998 (RFE/RL) -- Penal reformers say Russia and other former
    Soviet republics face a desperate crisis in their prisons, requiring a new
    approach to overcome problems of overcrowding, disease and lack of resources. 
    
    But they also say that well-meaning foreign specialists without understanding
    of the Soviet-era prison system and its history, can do more harm than good
    with their advice. 
    
    Dr. Andrew Coyle, director of the International Center for Prison Studies at
    King's College, London, says the penal system in the former Soviet Union faces
    two monsters: inhumane conditions in pre-trial prisons, called sizos, and a
    collapse of the labor camp system. 
    
    Coyle says gross overcrowding is the problem at pre-trial prisons like Butyrka
    in central Moscow, built in 1771. There, says former Governor Gennadi
    Oreshkin, prisoners often collapsed from lack of oxygen or swollen legs. On a
    visit in 1994, a delegation from the Duma, the Russian parliament, found that
    cells designed for 28 people were housing up to 110 prisoners. 
    
    Coyle also is a former prison governor, in his case of one of London's largest
    prisons. He says that he regards prison conditions as a human rights issue.
    Major cities across the former Soviet Union have Butyrka-type prisons. 
    
    "Every major city has one. Where the prisons are in a room this size and we
    would be told that it was built for 20 people. There are 40 beds in it, and
    there are 90 people in it, and they are locked up 24 hours a day. When you
    open the door, they're all standing there. This is why TB and disease are
    rampant because people will be there for up to two years." 
    
    The U.N. special 'rapporteur' on torture, Professor Nigel Rodley, of Britain's
    Essex University, who visited two pre-trial prisons in Moscow in July 1994,
    called the conditions there infernal. 
    
    Pre-trial prisons hold about a quarter of Russia's prisoners. Partly a legacy
    of the monolithic character of the Soviet system, similar prison conditions
    still exist in many areas of the former Soviet Union, particularly in the
    Central Asian republics. 
    
    Traditionally, conditions were better in the work camps, or labor colonies, of
    the countries of the former Soviet Union. Inmates were sent there from the
    
    pre-trial prisons after conviction. Many were basically factories making
    everything from clothes to furniture. 
    
    Vivien Stern, secretary general of the prison-reform group, Penal Reform
    International, says these work camps reflect the major difference between the
    Western and Eastern traditions of treating convicted criminals. In the Western
    tradition, big prisons are located in towns so that citizens will see the
    fearsome portals and be deterred from crime. In the Eastern tradition,
    prisoners are exiled far from the main centers of population. Often, they are
    sent to the places where minerals -- gold or diamonds -- need to be dug out of
    the ground, or to the frozen north where dams and railways must be built.
    Inmates also worked handling dangerous chemicals. 
    
    Zdenek Karabec, director of the prison service in the Czech Republic until
    1995, points out that in every former communist country prisoners were used as
    cheap labor. The planned economy depended on their labor. They were given work
    which other citizens refused because health and safety conditions were so bad.
    Prisons had the appearance of concentration camps. 
    
    This Gulag system was ubiquitous. Many prisoners were sent to the Central
    Asian republics, particularly Kazakhstan which had a particularly high
    proportion of labor colonies. Still Coyle, the Kings College penologist, says
    that the Soviet-era factory camps are preferable to pre-trial prisons. 
    
    "At one level it's certainly much more tolerable than the sizos. The factories
    would work 24 hours a day, seven days a week, 12 -hour shifts, but for the
    other 12 hours they were left to their own devices. They went back to the
    hostel inside the perimeter fence. They wrote their books, sang their songs,
    or whatever." 
    
    Stern says many visitors from Russia coming to see prisons in the West, whilst
    impressed by the physical conditions and the educational opportunities offered
    to inmates, prefer the model of the Russian labor camp, seeing it as less
    inhumane.
    
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    #8
    Interview with Foreign Minister Igor Ivanov 
    
    Komsomolskaya Pravda
    30 September 1998
    
    Interview with Russian Foreign Minister Igor Ivanov by Yelena
    Ovcharenko and Andrey Baranov in New York; date not stated:
    "Chancellor Ivanov Loves Corrida and Is Loyal to Foreign Ministry"
    -- first three paragraphs are introduction
    

      New York -- The trip to the UN General Assembly session was a benefit
    performance by Igor Sergeyevich in his new capacity and Komsomolskaya
    Pravda was the first Russian newspaper to which the minister gave aninterview.
    
      The new Russian foreign minister, Igor Ivanov, celebrated his 53d
    birthday in New York.  Only close to midnight did his colleagues persuade
    him to go out to the Firebird restaurant but they spent literally only half
    an hour at table.  That was how they celebrated his birthday.
    
      There is no need to present the "skyscraper's" new incumbent to
    diplomats:  "Yegor" or "Igor Sergev" as they call him among themselves has
    climbed the career ladder before their eyes.
    
      [Komsomolskaya Pravda]  Igor Sergeyevich, only 18 months ago Primakov
    was saying in private that he saw you as his successor. During this time
    were you ever tempted to take the helm sooner?
    
      [Ivanov]  In May President Yeltsin visited the Foreign Ministry. 
    Addressing the collegium, he said:  Yevgeniy Maksimovich [Primakov], I ask
    you to head the ministry for my entire presidential term through the year
    2000.  We all welcomed this with great enthusiasm, and that includes myself
    because I enjoyed working with Yevgeniy Maksimovich in the atmosphere we
    had at the ministry -- a creative and comradely atmosphere.  And I
    proceeded from the premise that there would be no changes in my life before
    the year 2000.  So I was not thinking of any appointments or changes.
    
      [Komsomolskaya Pravda]  The country is now in such a state that
    foreign policy could seem a secondary matter to our citizens.  Of course
    you do not think that way?
    
      [Ivanov]  I believe that it is today that, on the contrary, the role
    of diplomacy is growing.  We can cite examples of this from our history --
    you only have to take Chancellor Gorchakov [foreign minister under
    Alexander II].  When things are going badly in the country everything must
    be done to create favorable external conditions promoting the solution of
    internal problems.  Here in New York I have spent half my time engaging not
    in international affairs but rather in our domestic affairs....
    
      [Komsomolskaya Pravda]  Of foreign policy problems particular alarm is
    being generated right now by everything that is happening not far from our
    southern border and by the situation with regard to the Russian-speaking
    population in Latvia and Estonia.  What are your forecasts for the
    development of the situation in Afghanistan and the Baltic?
    
      [Ivanov]  I shall begin with the Baltic states.  We hope the situation
    will start to improve.  We can see promising signs.  Of course there was a
    temptation to bang our fists, to threaten, to brandish something.  But I
    believe we displayed political wisdom, using the levers which could produce
    a longer-term effect, that is international organizations -- the Council of
    Europe, the OSCE [Organization for Security and Cooperation in Europe], the
    United Nations -- in such a way as to create international intolerance
    around this problem.  Because the West is very sensitive toward human
    rights.  And we had to show that these values are being violated.  The
    small countries which have now become sovereign states should have exactly
    the same demands made on them as the West makes on us.  I believe we have
    succeeded in doing this.  Gradually the process has advanced from a
    standstill.  I am personally moderately optimistic.  Moderately, because I
    know what resistance exists inside these countries on the part of certain
    forces.  And optimistic because the Baltic states want to come closer to
    European structures, above all the European Union.  And without resolving
    those problems they will not be able to join.  Moreover, this is in the
    interests of these countries themselves.  It will then be all the easier to
    build relations with Russia.  You know very well that however eager our
    neighbors are to join the European Union it will not replace the Russian
    market, because it will be hard for them to compete with the output from
    other states.
    
      As for Afghanistan, it cost us great efforts to persuade many states
    that the Afghan problem exists at all and that it could develop into a very
    serious regional problem.  Now I think that this breakthrough has occurred
    in people's attitudes:  In New York there was a session at the level of the
    ministers of the countries that are Afghanistan's friends and neighbors and
    we agreed the principles making it possible to alter the trend in this
    process. The main thing is that there should be no massive outside support
    for the Taleban.  And now we have succeeded in reaching agreement among
    ourselves on specific steps for isolating or bringing joint pressure to
    bear on the Taleban to force them to sit at the negotiating table under UN
    auspices.  Although there is a very hard struggle ahead to ensure that
    these accords are implemented in practice.
    
      [Komsomolskaya Pravda]  It is not out of the question that the events
    in Kosovo could develop according to a strong-arm scenario -- contrary to
    Moscow's appeals.  This is also an addition to the lowered self esteem
    which Russians have:  We have no allies, we have no money, we are not taken
    into account.  What is your philosophy on this score?
    
      [Ivanov]  Of course it is always simpler when you have a powerful
    rear.  Any diplomacy feels considerably more comfortable when there is a
    strong power, especially a nuclear power with a dynamic economy, behind it.
    
      The situation in Russia now is somewhat different.  And here diplomatic
    skill comes to the fore. The skill of seeking compromises, of considering
    the interests of different states on different issues, of seeking allies --
    perhaps not for life but for a specific given instance.  We do not dictate
    -- today there is hardly anyone who dictates at all -- but our country is
    an important player on this very complex chessboard.
    
      [Komsomolskaya Pravda]  Igor Sergeyevich, what does the minister do
    outside his office?  What are your hobbies?  What kind of family do youhave?
    
      [Ivanov]  My career you know; it is remarkably straightforward. I have
    a small family, a wife and a 26-year-old daughter.  I met my wife at the
    Institute of World Economy and International Relations.  We were graduate
    students there together.  We have been married for nearly 30 years now. 
    Somewhere in the mid-eighties my life took shape in such a way that 24
    hours a day were devoted to work.
    
      In principle I like many things.  When I was ambassador to Spain I
    still managed to combine work with what I love -- travel, visits to the
    theater, the ballet, listening to music.  I am fond of sport, I like the
    corrida, of which I have quite a good understanding.
    
      It is true that I probably do not know how to organize my life and my
    time well.  I never manage to finish work earlier than 2100-2200 hours and
    then the day is almost over.  When I have read something, it is
    alreadymorning.
    
      I shall tell you frankly that I do not want to pretend that I collect
    stamps or coins or write poetry -- I do nothing like that. If only I can
    read some of the books that are being talked about, or get to see
    something.  I used to be a cultural adviser and I was an adviser for the
    press and I still have many friends from that time -- Rostropovich,
    Spivakov, Pletnev...  I was very touched when they all telephoned me and
    congratulated me on my appointment.
    
      [Komsomolskaya Pravda]  And what is your daughter by profession?
    
      [Ivanov]  A philologist.  She has graduated from the State Central
    Courses for the Extramural Study of Foreign Languages and then the
    languages faculty at Madrid University -- when I was ambassador there.
    
      [Komsomolskaya Pravda]  Hasn't your family given up on you now? Do
    they wait for you when you come home late at night?
    
      [Ivanov]  My wife's father -- and this is a great advantage -- was a
    diplomat and she was raised in that environment.  And she has a very good
    idea of what it is like and accepts it as necessary and normal.  Although I
    obviously ruined her professional life:  We studied together as graduate
    students and prepared to become scientific workers.  And then she traveled
    to Spain with me without defending her dissertation (she specialized in the
    Italian agro-industrial complex).  In Madrid she wrote a different
    dissertation -- on the Spanish economy.  But when she arrived she was
    obliged to put that dissertation aside as well because I had problems
    again.  In general life is not that simple for diplomats' wives because
    after all someone has to be responsible for the family, organize daily life
    so that there is a home....
    
      [Komsomolskaya Pravda]  You have met with President Clinton -- how is
    his morale?  Is concern with "Monicagate" taking precedence over stateissues?
    
      [Ivanov]  I was pleasantly surprised at how closely the president is
    following events in our country.  It was an informal meeting, a really
    interesting, very dynamic talk, mostly on events in Russia.  And I formed
    the deep conviction that the President is sincerely interested in Russia
    overcoming its problems and acute crisis.  Because, as an intelligent
    politician, he understands that the stabler it is in Russia and the
    stronger Russia is economically, then the calmer the world is as a whole.
    The president was interested primarily in how rapidly our country will
    be able to overcome the difficulties that have arisen.  I did not notice
    that the president was indifferent or was preoccupied with some otherproblems.
    
      [Komsomolskaya Pravda]  Many people wonder what will happen to
    Yastrzhembskiy.  Since he came to the Kremlin from the Foreign Ministry are
    there any grounds for believing that the former press secretary could
    return there?
    
      [Ivanov]  Yastrzhembskiy is a strong diplomat and he worked very well
    at his last post as ambassador in Bratislava.  So from the professional
    viewpoint there are no questions.  As for his personal interests and plans
    I have not talked to him on the subject.  We have received no specific
    proposals on this score.
    
    
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