CRISIS MEDICINE

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CRISIS MEDICINE

Rossiiskaya Gazeta, April 25, 2001, p. 1

Tomorrow the Cabinet will discuss how to avoid a repeat next winter of the energy crisis which afflicted vast territories over the past few months. Electricity industry leaders resolved to hold a preliminary discussion of this sensitive issue among themselves.

There was a national meeting of electricity executives yesterday in Vladivostok. Anatoly Chubais, chairman of Russian Joint Energy System, criticized the management of both regional electricity utilities in Primorye (Maritime territory) – Dalenergo and LuTEK. Chubais considers there can be no justification for their performance.

Chubais is still intent on using the only method of “treatment” – mercilessly cutting off power to those who don’t pay. But can this be a panacea?

According to Konstantin Pulikovsky, presidential envoy for the Far Eastern federal district, the electricity sector in this part of Russia has been in continual crisis for the past four years. Electricity companies are constantly running short of fuel and money. For example, the shortage of coal over the past winter was 2.5 million tons; and 28% of coal used had to be transported from the Kuzbass region, at very high cost.

Meanwhile, excellent coal was available much closer to hand – at Neriungri in Yakutia, where the cost of production is low, and Soviet-era infrastructure has the capacity to supply the entire Russian Far East with coal. However, there was a crisis in the 1990s at the Neriungri coalmines. Clearly, this is the result of a total lack of good planning and leadership by Russian Joint Energy Systems.

At parliamentary hearings on March 7, Anatoly Chubais made the alarming announcment that Russia is experiencing a coal shortage: coal consumption at power plants in 2000 rose by 12 million tons, while coal output rose by only 8 million tons. Therefore, Chubais said he intends to request the Cabinet to reconsider this year’s budget and increase direct state spending on support for the coal-mining industry.

NEW CHARGES AGAINST VLADIMIR GUSINSKY

Rossiiskaya Gazeta, April 25, 2001, p. 2

News agencies reported yesterday that another charge has been issued against Vladimir Gusinsky. The General Prosecutor’s Office had previously accused him of fraud; now it has added the charge of large-scale money laundering.

By Western legal standards, even in Spain, money laundering charges are considered much more serious than fraud. Hence the question: why weren’t both charges issued at the same time?

Until yesterday, when the General Prosecutor’s Office announced the new charges, Gusinsky was saying he planned to go to Israel. Whether his plans have now changed remains unknown. There has been no comment so far from Gusinsky or his attorneys about the latest move by the General Prosecutor’s Office.

UKRAINIAN CABINET LIKELY TO BE DISMISSED

Trud, April 25, 2001, p. 2

It became clear yesterday that the Ukrainian Cabinet doesn’t stand a chance. Seven parliamentary factions support dismissing the Cabinet, and 278 members of parliament voted in favor of starting work on a no-confidence motion immediately after the lunch break. (It would take 266 votes for a no-confidence vote to succeed.)

Prime Minister Yushchenko did not attend; he is on a visit to Greece.

President Leonid Kuchma, on an official visit to Lithuania, spoke about the likely Cabinet dismissal; he called on everyone concerned not to over-dramatize the situation, and noted that government crises happen everywhere – the only way a Cabinet can be viable is if it has political support in parliament.

WAHHABI INFILTRATORS DISGUISED AS TURKISH LANGUAGE TEACHERS

Izvestia, April 25, 2001, p. 1

Jaffar Bikmaev, head of an association of Muslim clergy in the Rostov region, has opposed the opening in Rostov-on-Don of a Russian-Turkish education center sponsored by the Tolerance Foundation. The center’s founders have said their goal is to teach people about the culture and history of Turkey, and the Turkish language. Mufti Bikmaev tells a different story.

Bikmaev considers that a Turkish religious group called Nurjular is involved in the center – hence, the education center could be a cover for a religious cult close to the spirit of Wahhabi fundamentalism.

Bikmaev says: “Fatullah Guilen, the leader of Nurjular, has links with Wahhabis in Saudi Arabia; he is now in exile in the United States, charged with a coup attempt in Turkey. This does give us something to think about. Guilen’s training colleges, which were more like army barracks, have been shut down by the Turkish authorities. Meanwhile, they’re getting the green light here.”

Bikmaev is also concerned by the fact that Tolerance Foundation leaders didn’t even consider it necessary to meet with him; and they’re engaging in charity work without notifying the regional association of Muslim clergy.

The Rostov-on-Don municipal government says: “We don’t have any information about this education center at present, but we intend to get it soon, and clarify everything.”

THE CASE IN VORONEZH COULD GET A LOT OF PUBLICITY

Izvestia, April 25, 2001, p. 3

US citizen John Tobin faced a court in Voronezh yesterday. Two months ago, he was detained when leaving a nightclub and found to be in possession of some marijuana. A search of his apartment revealed that the premises were being used for drug-taking.

At the court hearing Tobin gave an entirely different explanation for all this. He said that on the night of his arrest, he had grabbed a small box from the bar, thinking it contained matches. When asked who owned the drugs found in his apartment, Tobin calmly replied that he had nothing to do with those drugs.

Tobin is charged with participating in an organized drug-dealing group, and with using premises for the purpose of drug-taking. The former graduate student at Voronezh State University faces a maximum prison term of up to 15 years.

The special services have decided not to charge Tobin with espionage. However, the Voronezh branch of the FSB is still sure that he has links with US intelligence. In part, this is because it has been confirmed that John Tobin is a member of the 325th military reconnaissance battalion, based at Fort Waterbur in Connecticut. According to the Russian counter-intelligence service, it’s also significant that Tobin and the US embassy have categorically refused to talk to the media about this case.

INFLATION: HEADS IN THE SAND

Izvestia, April 25, 2001, p. 5

Higher than expected inflation remains one of the most serious problems facing the Russian economy.

The 2001 budget is based on 12% inflation; the macroeconomic development forecast puts it at 12-14%. However, inflation reached 7% in the first quarter; and it is likely to be 9% for the first four months of the year, according to Mikhail Zadornov, deputy head of the Duma Budget Committee.

Most Russian economists cite two reasons for inflation: higher prices for the services of natural monopolies, and the amount of money printed by the Central Bank. However, there are also different opinions. Monetarist guru Milton Friedman said that inflation is always a monetary phenomenon – it can only be caused by money supply.

The Central Bank is steadily refusing to revise its inflation forecasts used to forumulate the basic directions of monetary and credit policy (a document which the Duma sent back for rewriting, and which still hasn’t been resubmitted to the Duma).

Meanwhile, the Cabinet has already amended its own forecast: Alexander Shokhin, head of the Duma Banking Comittee, says the Cabinet expects inflation to be around 16.1% for this year. But no one has yet requested the Central Bank to stop forcing exporters to sell 75% of their hard-currency revenues for rubles – it’s for this purpose that the Central Bank is printing so much money. Budget indicators linked to changes in the inflation rate still haven’t been revised; according to Shokhin, the Cabinet won’t decide to do this “until well into autumn”.

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