THE CASE SMELLS OF GASOLINE

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THE CASE SMELLS OF GASOLINE

Izvestia, June 4, 1999, p.1

Within the last week and a half, the attacks of Chechen detachments on block posts and reinforced points of federal troops and police adjacent to the border have become a local war. Certain reinforced points (for instance Grebenskoy Bridge) have been fired on several times a day, and helicopters even had to be sent in to suppress mortar fire from the far bank of the Terek River. But Chechen detachments have not made a single attempt to seize positions held by federal troops, and the volleys have been directed at bridges and highways.

The most believable and, more importantly, easily proved explanation is that the lunges of the Chechen bear have an exclusively economic motivation and are connected with the commercially strategic locations of certain bridges over the Terek and certain highways.

The matter concerns large-scale trade in locally-produced gasoline, which has increased within the last year are comprises the main “revenue item of the budget” of both Chechnya as a whole and separate groupings within it. Gas stations have started appearing all over the North Caucasus like mushrooms after the rain, and in terms of profitability and prestige the gas business has reached the alcohol business at its peak.

Attacks on posts of federal troops begin with strategically important spots (from the point of view of drivers of gasoline tankers) about which no agreement can be achieved. The majority of Internal Troops which are sent to the Chechen border are not inclined to accept bribes, unlike, unfortunately, the local police.

EUROPE HAS LOST ITS CHICKENS

Izvestia, June 4, 1999, p.2

The first batches of chicken meat ordered by the Russian Veterinary Service which were received from Belgian farmers have been withdrawn from stores. As a preliminary analysis witnessed, a certain quantity of the chicken meat on the markets of Moscow, St. Petersburg, Saratov, and a number of other industrial centers may be infected with the dangerous chemical substance dioxin, which even in minimal doses causes cancer.

The Russian Ministry of Agriculture has demanded that the EU Food Committee prohibit sale of poultry which is infected with dioxin. By way of explanation, experts think it possible that infected mixed fodder could harm poultry farms not only in Belgium, but also in the Netherlands, France, and Germany (Russia buys poultry meat from those countries too).

It has also become known that, staring July 1, the Russian Health Protection Ministry will start inspecting imported foodstuffs and raw food materials from genetically modified sources. This concerns vegetables, fruits, and cereals which have been changed through genetic selection to have a lower starch content, frost-proof qualities, etc.

TAX BILLS TO BE DISCUSSED TODAY

Izvestia, June 4, 1999, p.2

On the threshold of the discussion of the decisive package of tax laws, Alexander Pochinok gave his first press conference as Minister for Taxes and Duties, during which he talked about the reform plans of his department.

According to Pochinok, reductions of taxes on gas stations will comprise only 1.5-2% of the gross income of stations, which “will not influence prices.” However, Pochinok was referring to the first draft of the bill, which set a minimum tax of 12,000 rubles per gas station. Simultaneously, an alternative draft of the document, which was proposed by deputies Alexander Zhukov, Sergei Don, Georgy Luntovsky, and Vladimir Vernigora, is to be discussed today in the Duma. The document calls for increasing the tax by three times. (The minimum tax on gas stations located in cities with populations of over 1,000,000 people, will be 36,000 per month). Regional power bodies will also have the possibility to levy an additional 50% of the taxes for local budgets.

Pochinok is certain that the tax on cars with high-capacity engines will not infringe on the rights of the population. The ministry has also elaborated a bill which sets the lower limit of the engine capacity on which the tax is meant to be imposed as 3 liters instead of the former 2.5 liters. Thus, Russian cars will not be taxed. The owners of Volga cars which are equipped with Toyota engines will have to support the budget, but such cars are few in Russia. However, tax collectors will manage to procure money from illegally imported foreign cars.

Moreover, Pochinok noted that the government will withhold from submitting a bill increasing the excise on alcohol to the Duma, contrary to the demand of the IMF. This document, which is now being discussed in the Concord Committee of the Duma and the government, calls regulating alcohol production.

Pochinok has made it clear that he is not going to reject the idea of his predecessor, Georgy Boos, of decreasing the turnover tax. The minister has promised to change its “unjust scale”. According to Pochinok, the basic rate of this tax should be 13-15%. As the minister stated live on ORT, “If it depended on me, I would set a maximum rate of 22-25%, but currently it can be decreased at most by 10% (from 45% to 35%).”

IMPEACHMENT MAY HAVE A "MEDICAL" NATURE

Parlamentskaya Gazeta, June 4, 1999, p.1

Yesterday, the Constitutional Court started considering the case of interpreting Article 92 of the Constitution, which concerns the chain of command if the Russian president becomes incapacitated.

An inquiry on this matter was initiated by the Duma as long ago as January 1998. Part 2 of the article proclaims, besides “dismissal”, cases of “persistent inability to work because of health” and “removal from office”. Part 3 states that in all cases the president’s powers are to handed over to the prime minister for at most three months, by which time pre-term presidential elections must take place.

As a certain high-ranking official of the Presidential Administration has said, “The Duma is once again taking up the idea of the impeachment, with a medical slant this time.”

THE ATOM REQUIRES INVESTMENTS

Parlamentskaya Gazeta, June 4, 1999, p.1

In the near future, Russian experts will begin building a nuclear power plant of the new generation with an up-to-date emergency protection system and a powerful VVER-1000 energy unit.

The plant will be built on the site of the acting Novovoronezh nuclear power plant. The Atomenergoproyekt State Scientific Research and Project Construction Institute is the chief researcher of the project. Director of the Institute Yury Vishnevsky has stated that “this in the best project in all of Russia, and makes use of all the achievements of the international nuclear energy industry.” Experts mention that changes in legislation on the atomic industry are necessary to attract Russian and foreign capital. Currently, the law does not allow investments in nuclear power plants.

A PRESS CONFERENCE WITH STEPASHIN

Independent Television, Segodnya, June 3, 1999, 14:00

About 200 journalists attended the press conference of Prime Minister Sergei Stepashin. Stepashin represented the members of the new Cabinet. First Vice Premier Nikolai Aksenenko will act on behalf of Stepashin during his possible absence and substitute for him as secretary of the committee responsible for urgent problems. Another vice premier, Victor Khristenko, will work on budget policy and macroeconomic issues. Stepashin also announced the names of the members of the new Cabinet who retained their posts after the dissolution of the former government. He also specified that Director of the Central Bank Gerashchenko, President of Russian Academy of Sciences Osipov, and Special Representative of the President to the International Monetary Fund Zadornov will attend every meeting of the government.

AN EXTRAORDINARY MEETING OF THE DUMA

ORT, Novosti, June 3, 1999, 12:00

Duma deputies decided to invite Defense Minister Sergeev, Chief of the Department for International Military Cooperation Ivashov, and Deputy Foreign Minister Avdeev to the extraordinary meeting of the Duma at 12:30. It was also decided to invite Yugoslavian Ambassador to Russia Borislav Milosevic to the meeting. The deputies think that Special Envoy Chernomyrdin made inadmissible concessions at the negotiations in Bonn.

A MEETING IN BELGRADE

ORT, Novosti, June 3, 1999, 12:00

A meeting of Russian Special Envoy Chernomyrdin, Finnish President Ahtisaari, and Yugoslavian leader Milosevic began in Belgrade on June 3. Chernomyrdin and Ahtisaari gave Milosevic the new proposals for a peaceful settlement of the crisis in Kosovo which were discussed in Bonn. At the airport, Chernomyrdin stated that the process of negotiations was very difficult, but that the sides had managed to agree on an approach to settling the crisis. According to the plan which was worked out in Bonn, Yugoslavian forces must leave Kosovo, and only after that will the bombings be stopped. International peacekeeping forces under the separate command of Russia and NATO will be stationed in the region and will act under the aegis of the UN. The core point of the settlement is to keep Kosovo part of Yugoslavia. But there are some disagreements regarding the international military presence in the region. According to Chernomyrdin, the command of the peacekeeping forces will be separate, but NATO Official Envoy Jamie Shea stated that it is inadmissible to divide the forces to sectors.

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