RUSSIA IS NOT FINANCING BELARUS

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RUSSIA IS NOT FINANCING BELARUS

Izvestia, March 15, 2001, p. 2

Last October, it was agreed that Russia would grant Belarus a $100 million loan within the framework of transition to a common currency.

There is more to the delay with the first installment than meets the eye. Preparations for the presidential election are about to begin in Belarus – and Moscow has not yet decided whether it wants Alexander Lukashenko re-elected.

Six years ago, then-prime minister Vyacheslav Kebich, running for president, fell victim to a similar delay. Kebich actively promoted Belarus as part of the ruble zone (it would have taken loans from Russia too); but Moscow postponed paying the money. As a result, deputy Lukashenko won the election.

History may repeat itself now. The sum promised by Russia is double the hard currency and gold reserves of Belarus. Russia doesn’t lose anything by withholding the money from Minsk. It is impossible to stabilize the Belarussian currency, if the Belarussian government continues with its present financial policy. And the state of the Belarussian economy, all but wiped out by Lukashenko’s socialist experimentation, will only deteriorate.

BORDER GUARDS UNITE

Izvestia, March 15, 2001, p. 3

Russian, American, Japanese, and Korean experts met in Vladivostok yesterday for a conference on international border cooperation in the north-western Pacific. Sources in the PR department of the Pacific Regional Directorate of the Federal Border Guards Service say the experts will define the structure, functions, and tasks of national border coordination centers. These bodies will eventually establish a common database on all violators, and expand each nation’s technical capacity to monitor the situation at sea.

THE DEFENSE SECTOR IS THE NATION’S SHIELD

Izvestia, March 15, 2001, p. 6

An interview with Nikolai Klein, general manager of a plant producing anti-aircraft systems.

Question: Nikolai Vladimirovich, since conversion has failed, it seems that the government might have decided to forget the whole military-industrial complex with all its problems. The Property Ministry proposes to sell off half of defense sector enterprises, or turn them into joint-stock companies.

Nikolai Klein: How can they abandon us? We are the nation’s shield. Not everything can be sold, either. For the time being, this concerns only plants which do not have a guaranteed state defense order. That means almost half of the industry’s 1,600 plants. Actually, it is pointless for them to await anything from the state. They should convert into joint-stock companies and try to survive on their own. We have been waiting for government assistance for too long, and this has all but ruined some unique plants. According to the conversion program, for example, my plant was entitled to 200-300,000 rubles a year. That’s a joke. Installing one electric loading machine for serial production cost us 15 million rubles. The state doesn’t have enough money for the defense industry. All right, it has finally admitted as much.

Question: You mean no money for your plant either?

Klein: Yes. We became a joint-stock company in 1994, and have never regretted it. We have a portfolio of contracts, we pay wages on time, and we are more or less confident about our own future – with or without state defense orders.

Question: You produce S-300 systems, the best anti-aircraft systems in the world. Doesn’t Russia need them?

Klein: They are indeed the best – which means they are expensive. It means that only a few of them are being bought. The Russian armed forces do have some of them. At the same time, we have not assembled a single system for export.

That is why it is more rewarding for us nowadays to upgrade these and other systems, like the Osa or the Tor-M1. For years, the state has not been able to decide what weapons systems it needs; nor what plants and production capacities it needs, for that matter. We are still waiting for a restructuring program. There are rumors that it will appear in March. Those plants that will be assured of state defense orders by this program will be the lucky ones. As for us, we have drawn up three survival plans without it.

WORLD BANK WILL COMBAT CORRUPTION IN RUSSIA

Izvestia, March 15, 2001, p. 6

The World Bank and the Economic Development Ministry are working on a project that involves researching corruption in Russia. It will take the form of a nationwide survey of businesspeople, investors, and ordinary Russians.

PLANS FOR A FINANCIAL INTELLIGENCE AGENCY

Nezavisimaya Gazeta, March 15, 2001, EV

A finanical intelligence agency may be set up in Russia, according to Deputy Prime Minister and Finance Minister Aleksei Kudrin. Kudrin emphasized at his press conference yesterday that it should be established “outside the law enforcement agencies”.

Kudrin says that financial intelligence is not the official title of the future body. It will rather be “a financial laboratory”, he says. It will employ specialists in economics and finance, to analyze the accounts of companies and enterprises and point out inconsistencies and violations.

PERSONNEL CHANGES AT THE TV-6 NETWORK

Nezavisimaya Gazeta, March 15, 2001, EV

Igor Shabdurasulov, former senior deputy director of the presidential administration, will become chairman of the TV-6 board of directors, sources at TV-6 say. The controlling interest in the company will remain in the hands of Boris Berezovsky, but a major Western investor will be on the board of directors as well. Nothing else is known about the matter at this point.

Shabdurasulov says “everything will become clear at the annual general meeting of TV-6 shareholders in late March.”

OUR MAN IN WASHINGTON

Rossiiskaya Gazeta, March 15, 2001, p. 2

Introducing Kukes to the Board, Council Chairman Eugene K. Lawson emphasized that “The main objective of the Council is to facilitate Russian-American trade links and expand the presence of private American companies in Russia. We expect Mr. Kukes to share his invaluable experience accumulated over years of successful work in the United States and in Russia.”

Kukes: I will do all I can to facilitate partnership and truly beneficial cooperation between Russian and American businesses. It will give momentum to effective development of the Russian economy, the oil and gas sector, and the Tyumen Oil Company, of course.

GUBERNATORIAL ELECTION IN PRIMORYE: AN UPDATE

Rossiiskaya Gazeta, March 15, 2001, p. 2

Vera Dovgopolova, a janitor at the Vladivostok trade port, has informed the electoral commission of Primorye (Maritime territory, Russian Far East) that she is compiling signatures for registration as a candidate for Primorye governor. Dovgopolova may become the seventeenth candidate and the only woman on the list.

Igor Kasatonov, former deputy commander-in-chief of the Navy, is another candidate for governor of Primorye.

REPORTS FROM THE FEDERATION COUNCIL

Rossiiskaya Gazeta, March 15, 2001, p. 2

At its plenary meeting yesterday the Federation Council almost unanimously approved Sergei Mikhalkov’s lyrics for Russia’s new national anthem, using Aleksandrov’s music. Only one senator voted against, and there were no abstentions.

The upper house also passed amendments to the 2001 federal budget. According to these, 41.2 billion rubles ($1.375 billion) of additional revenues will be used to service foreign debts in line with the original payment schedule agreed upon with the Paris Club. Additional budget revenues are expected to reach 124 billion rubles, of which 63 billion rubles will be spent on foreign debts.

“The government’s aim is not to accumulate debts,” said Deputy Prime Minister and Finance Minister Aleksei Kudrin, who attended the meeting. “It is more advisable for us not to take out any new foreign loans, particularly since no one is granting them to us anyway.”

INTERIOR MINISTER VLADIMIR RUSHAILO HOLDS PRESS CONFERENCE

Rossiiskaya Gazeta, March 15, 2001, p. 2

Interior Minister Vladimir Rushailo visited Voronezh and Belgorod on Tuesday and Wednesday. Rushailo inspected municipal police forces and held a news conference.

The minister said that security structures were following a common plan in implementing the counter-terrorist operation in Chechnya.

According to Rushailo, 18 permanent police departments have been set up in Chechnya, and village precincts are now being formed (up to 130). For the time being, Chechnya’s police force cannot maintain order as it should, which makes the presence of additional Interior Ministry forces in Chechnya essential, Rushailo said.

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