MONEY, AND HOW MUCH OF IT THERE IS

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MONEY, AND HOW MUCH OF IT THERE IS

Finansovaya Rossiia, No. 12, April, 2001, p. 2

In 2000, an exceptionally successful year for the economy, real incomes were only 48% of what they were at the end of the Soviet era.

Business revived. Last year may well be termed the year of property-owners and capitalists. Statistics say that income from assets rose by 26% in 2000, while the revenues of business owners grew 16%. Wages only rose half as much – by 8%, while welfare payments actually dropped by 1.2% in real terms.

We still haven’t regained the real income levels of 1997, the pre-crisis year. According to the State Statistics Committee, we are now 20% worse off than we were in 1997. But living standards continue to rise. In January, real incomes were 9.4% higher than they had been a year earlier.

However, although the outlook for this year is fairly good, there are grave doubts about 2002; going by the past decade, the trend in living standards changes about every two years; so if they were rising last year and this year, they are likely to start falling next year. Many economists consider that after the “exceptionally successful” year of 2000, industrial growth will have enough momentum to continue throughout 2001; but whether this momentum will be sufficient for 2002 is an open question.

BLACKMAIL WITH SIGNIFICANCE FOR UNION

Finansovaya Rossiia, No. 12, April, 2001, p. 5

At its meeting in March, the CIS Economic Council considered ten inter-state agreements, the drafts of which have been submitted for the meeting of CIS heads of state scheduled for May 31 in Minsk. And there’s not a word about debts owed to Russia…

It seems that our former fraternal republics have recently acquired a “collective sponsor” – the IMF and the World Bank. These organizations announced in mid-January that they are preparing joint proposals to reduce the amount of internal debt within the CIS.

So what is being proposed? First of all, writing off between a third and half of their foreign debts, because these nations are considered to be the least developed. At the same time, the IMF and World Bank recommend writing off all the debts the CIS nations owe to Russia – one reason being that these debts apparently aren’t registered with the Paris Club of creditor nations.

In return for such largesse, the IMF and World Bank advise Russia’s nearest neighbors to step up the pace of market reforms, eliminate the remnants of state regulation of the economy, and join the World Trade Organization as soon as possible. In other words, what the IMF and World Bank are actually doing is pushing the CIS nations toward breaking away from the common trade and customs area they share with Russia. The first breach was made in 1999, when Kyrgyzstan joined the WTO.

According to Western media reports, the United States, together with the IMF and World Bank, is looking at options for buying out the debts owed to Russia by CIS nations; thus, Russia would be “pushed out” of the CIS in financial and economic terms.

The most interesting aspect of these ideas is that they only arose after most of the CIS nations had agreed to pay part of their debts to Russia in real assets – for example, oil or gas pipelines, or shares in enterprises of the metals, chemical, and other industries. The first development was the IMF’s warning to Moldova in 1999: if it used such methods to pay off its debts to Russia, it wouldn’t get any financial aid. The IMF also expressed its displeasure, though less harshly, at the agreements reached between Russia and Ukraine in 1999-2001.

The financial and economic circumstances of the CIS nations today make them susceptible to accepting “debt in exchange for loyalty” plans.

REFORMS IN THE MARINES

Nezavisimoe Voyennoe Obozrenie, No. 12, April, 2001, p. 2

Among the measures recently authorized by President Putin, there’s one which has passed almost unnoticed: an announcement that the Main Command (glavkomat) of the Marines, abolished in 1998, is being restored, and that it will be headed by Colonel-General Nikolai Kormiltsev, commander of the Siberian military district.

The abolition of the Marines Main Command has been officially acknowledged as one of the errors in military reforms during 1998-2000.

According to sources in the General Staff, the Marines Main Command will implement the new directive on military districts, which was among 30 directives on military development recently approved by President Putin.

This directive states that during a state of emergency, the commander of a military district has overall command of all security structures in that district. A state of emergency is declared by presidential decree. Control of troops and cooperation with regional government bodies under these circumstances will proceed along the lines of the plan now being developed in Chechnya.

FROM RYAZAN TO THE PACIFIC: TROOPS FOLLOW THE SAME PLAN

Nezavisimoe Voennoe Obozrenie, No. 12, April, 2001, p. 2

The Russian Armed Forces held their largest military exercises for some years from March 19-24. The area covered stretched from Ryazan to the Pacific Ocean. A special feature of these exersises was that Defense Ministry troops worked closely with other security structures in carrying out training missions.

Unlike in the past, representatives of the Defense Ministry and General Staff were not in charge of exercises and maneuvers in the regions. Commanders of military districts, and the commander of the Paratroopers, were in charge. This put the territorial principle of troop management into practice, a principle which was named several years ago as a foundation of military reforms.

The specific combat objectives in the exercises were as follows.

In the Russian Far East: The exercises took place simultaneously across several training grounds in this military district. Forces included mobile artillery and tank divisions, air force and anti-aircraft units, headquarters and operational groups of the Far East military district and Pacific Fleet. Almost all operational headquarters and subdivisions of other security structures were likewise involved. The exercises required thousands of military personnel, hundreds of armored vehicles, armored personnel carriers, tanks, mobile artillery systems, field artillery and rocket launchers, 50 fighters and helicopters, 20 mobile anti-aircraft systems, and Pacific Fleet warships. Colonel-General Yuri Yakubov, commander of the Far East military district, directed the activities of divisions and joint groups.

The scenario was based on repelling air strikes by a hypothetical enemy, similar to those during NATO’s aggression against Yugoslavia. Anti-aircraft defense was directed by Colonel-General Yakubov himself.

The Urals: The exercises were held in the Chelyabinsk region. They were directed by Colonel-General Alexander Baranov, commander of the Urals military district. These maneuvers were aimed at testing new tactics for Russian troops, for combat in hot spots and liberating towns from guerrilla occupation. These were the first joint exercises by Defense Ministry troops with Interior Troops and police forces.

The tactics were further refined, based on new objectives set for the Urals military district in the recent concept for military development to 2010. There are plans to create new divisions in this district which would be capable of defending the southern borders of Russia and the CIS. It is not ruled out that these troops could become part of any coalition forces fielded by Central Asian states.

In Central Russia: Tactical maneuvers were held in the city of Ryazan and the Ryazan region, using the 137th Paratroopers regiment. Over 1,000 servicemen and 12 pieces of military hardware were dropped from nine Il-76 transport planes. Overall command of the Paratroopers was taken by Colonel-General Georgy Shpak.

These were the first exercises of this kind in 2001 for the Paratroopers. There are plans to make them more frequent in future.

REINFORCING THE PRIORITY AREAS

Granitsa Rossii, No. 13, April, 2001, p. 2

Colonel-General Nikolai Reznichenko, Chief of the General Staff of the Federal Border Guards Service, has announced that since troop strength in the FBGS is to be cut by 15,000, forces will be redistributed toward priority areas.

“We will reduce our forces in the Arctic, the Kaliningrad region, the North-West, the Russian Far East and Pacific, by an average of 15-30%,” Reznichenko said. Moreover, the FBGS central staff will lose 30% of its personnel. Reznichenko stressed that “on the contrary, border guard forces in the North Caucasus will be increased. The Itum-Kalin detachment is already being expanded, by around 15%.”

According to Reznichenko, the Russia-Kazakhstan border, 7,600 kilometers long, will be strengthened. Other than the Caucasus, this area is the most important in the overall system of ensuring national security, as well as border security. Ten border guard detachments and eleven checkpoints were deployed in this area last year. The density of coverage in this area will be doubled in the near future, says Roznichenko.

THE HIV PROBLEM: NOT A COMFORTING OUTLOOK

Meditsynskaia Gazeta, No. 25, April, 2001, p. 2

Professor Vadim Pokrovsky of the Russian Academy of Medical Sciences, head of the Russian AIDS Prevention and Counteraction Research Center, describes HIV infection as the “unknown epidemic”.

According to Pokrovsky, the figure of 103,024 HIV-positive people (from January 1, 1987 to April 1, 2001) is just the tip of the iceberg – only 10%. In the first quarter of 2001 alone, 25,000 new cases were registerd; so the figure is likely to rise by 100,000 by the end of this year!

Professor Pokrovsky attempted to explain the reasons for the lack of action by the government and the public in the fight against AIDS. He believes people are still “reassured” by the low number of deaths to date (“only” 995 people). But soon there will be more and more…

The link between drug use, prostitution, and HIV infection is widely known. Pokrovsky cited figures from a survey of prostitutes in Moscow: 14% were HIV-positive, 20% had syphilis, and 22% had various forms of hepatitis.

We will soon see a rise in the number of infected people. The forecast is that within five or six years, two to three million Russian citizens will be HIV-positive.

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