Izvestia, January 14, 2000, p.2

Early elections in certain Russian regions will be conducted on March 26 together with the presidential elections. Deputies of the Legislative Assemblies of the Kirov region and the Khanty-Mansysk Autonomous District decided to combine the elections on January 10, and on January 12 the deputies of the Saratov region and the Yamalo-Nenetsky Autonomous District joined them. By the way, Governor Vladimir Sergeenkov of the Kirov Region, whose term expires only in October 2000, was the initiator of the early gubernatorial elections in his region. Governor Alexander Filipenko of the Khanty-Mansysk Autonomous District supported the decision of the local Duma and confirmed his readiness to run for governor. Other governors also agreed to early elections. This decision is due to the necessity to reduce expenditure of regional budgets connected with gubernatorial elections.


Izvestia, January 14, 2000, p.4

Experts have completed the preparation of a CIS treaty on fighting legalization of illegal revenues (money laundering). The document has been sent to all CIS member countries. According to the creators of the treaty, it is necessary to fight money laundering, since at present in the majority of CIS countries shadow capital plays a significant role in the economy. According to experts in Russia, shadow capital is about 40% of GDP; 70% of revenues received illegally are invested in various businesses and becomes legal to a certain extent.

According to the treaty, cooperation of the CIS countries in this sphere will be developed in various directions: common standards of legislation, legal aid, information exchange, and confiscation.


Moskovsky Komsomolets, January 14, 2000, p.2

On January 14 the Tushin Court in Moscow should begin hearing the case of Hermes Finance, which became famous like MMM, Russky Dom Selenga (the Selenga Russian House), and Khoper Invest. It is only the second case regarding financial pyramids which has been brought to court (the Vlastilina case was the first).

Hermes Finance was founded at the end of 1993. The authorized capital of the company was only 1 million rubles. Valery Neverov and Vladimir Teplitsky, the founders of Hermes, became the creators of the new company. But soon their relations soured, because Neverov did not pay his share of the authorized capital. Despite the misunderstandings, Hermes Finance continued to advertise itself as a branch of the well-known Hermes company. Many investors entrusted their savings to the company (Hermes Finance offered 750% interest per annum).

The company’s main problems began in 1994, when the Bashkirskaya Oil Company, which supported it, failed. A year later the company’s managers disappeared.

The investigation lasted several years. The investors cheated by the company looked forward to the beginning of legal action. As a result, the deputy CEO of Hermes is facing charges.


Trud, January 14, 2000, p.1

On January 13 the Russian White House received the minutes of the meeting of the collegium of the Russian Aerospace Agency regarding the fate of the Mir space station. The previous day the collegium decided to send a crew to the space station on March 30 to carry out a scientific program over 45 days. Currently there is no one on board the Mir space station. On January 31 a Progress-M1 cargo rocket with fuel, oxygen, and food will be sent to Mir. At the end of March astronauts Sergei Zaletin and Alexander Kaleri will fly to the station.

In April the Agency will have to discuss again whether to extend the life of the Mir space station or to sink it. The proposal of the Agency regarding a flight of a crew to the station is to be approved on January 20 at the meeting of the federal government.


Rossyskaya Gazeta, January 14, 2000, p.2

A draft agenda for the CIS summit which will be held on January 25 in Moscow has been sent to the leaders of CIS countries.

Yury Yarov, Secretary of the CIS Executive Committee, stated that international terrorism, the results of the OSCE summit in Istanbul, the draft program for the development of the CIS to 2005, the issue of creating a free trade zone, and the issue of a coordinated antimonopoly policy are among topics for discussion at the summit. The issue of who will become secretary of the CIS (this post fell vacant after Yeltsin’s resignation) will also be discussed at the summit.


RTR, Vesti, January 13, 2000, 13:00

Today Vladimir Putin, the acting president, visited St. Petersburg. He spoke at a meeting of the government commission for celebrations of the city’s 300th anniversary, where financial issues requiring help from the federal center were considered. The acting president called on those present to clearly define what steps can be taken for the development of the city, since the aid of the government will be insufficient.

Vladimir Putin: We must clarify what we plan and what we can count on. As for me, I can say that the government will fulfil its obligations.


ORT, Novosti, January 13, 2000, 15:00

Today the first meeting of the government for 2000 was held in Moscow. It was chaired by Mikhail Kasianov, senior deputy prime minister. He spoke about new distributions of duties between the Cabinet members. In particular, Kasianov himself will be in charge of finance, state property, social development, and industrial policy. His duties also include interaction with the Central Bank of Russia, tax agencies, and other key economic structures. Thus, the senior deputy prime minister will become practically the only person in charge of the Russian economy.

The upcoming election was one of the key topics discussed at the meeting. The draft resolution on assistance to election commissions in preparing and holding presidential elections was approved.

Mikhail Kasianov: “In January the entire sum designated by the law for holding presidential elections, approximately 2.5 billion rubles, will be paid to election commissions. There will be no delays from the point of view of financing.”

According to Kasianov, the resolution also stipulates some details of preparation for voting in the Chechen republic.

Speaking about the government’s priorities, Kasianov stated that increasing the purchasing power of the public is a component of the economy development program. He said that this means increasing pensions and wages and eliminating wage backlogs, first and foremost. As for the current fall of the ruble, Kasianov remarked that the exchange rate will gradually decrease within the framework of the estimates in the 2000 federal budget. He reminded the meeting participants that the budget sets the exchange rate at 32 rubles to the dollar.

Kasianov: “January always brings the highest inflation rate. According to preliminary estimates, it may amount to two percent. However, this is normal. As for February and March, we have already worked out several alternative options of eliminating the budget deficit.”

Kasianov did not specify what options he meant, but he remarked that in January the budget is being implemented in accordance with the law. The government also does not lose hope of coming to terms with international crediting organizations. In February, the Cabinet hopes to negotiate with the World Bank and the London Club. Now it is preparing documents for negotiations with the IMF delegation, although the date of its visit has not been set yet.

Kasianov: “It is not necessary to emphasize that Russia is undertaking some measures in order to get money from the IMF. It is important, but it is not the most important point. The most important point is that programs which are supported by international crediting organizations correspond with the principles of the market economy followed by the whole world, and with the current stage of Russia’s economic development.”

Kasianov also reported that Vladimir Putin has authorized him to head the Russian delegation at the international economic forum in Davos, but he deflected a question about his possible appointment as prime minister following the election.


NTV, Segodnya, January 13, 2000, 07:00

Yesterday federal aviation flew over 70 combat missions. Missile strikes were launched against targets in the Vedeno and Argun canyons, in the villages of Argun and Shali, and in central Grozny. According to preliminary data, nine weapon emplacements, an ammunition depot, and a communication center of the guerrillas were destroyed. Missile strikes were also launched against three guerrilla bases in mountain regions of Chechnya. All agencies for interior affairs in the liberated areas of Chechnya are reported to be on alert. This is connected with the facts that groups of terrorists under the command of Ramanzan and Turnuly are trying to penetrate Urus-Martan and Achkhoi-Martan under the guise of civilians, in order to carry out terrorist acts there.

The federal forces attribute the tough resistance of guerrillas in Grozny to the fact that Aslan Maskhadov intends to hold his positions in Grozny as long as possible; it is a top priority strategic task. At the same time he has set his field commanders the goal of continuing partisan warfare in the liberated districts.

The Russian military, together with border guards, are preparing to repel attacks on the Georgian-Chechen border. Khattab has been directed to unblock the road leading from the Argun canyon to the Georgian settlement of Shatili. The range of activity of the federal troops in Chechnya is very wide, which makes it impossible to define where the principal fighting takes place. However, it is obvious that the federal forces have not yet begun the final assault on Grozny.

Today Vladimir Rushailo, interior minister, arrived in Chechnya. He was met by journalists at the airport.

Vladimir Rushailo: The situation in Chechnya is normal. I think that all information about serious troubles reported by the media is a grotesque exaggeration. The situation is under control. We came here today in order to find out the details of the situation. Anatoly Kvashnin, head of the General Staff, Kalashnikov, deputy head of the immigration service, and Nikolai Koshman are here. Tonight we are going to hold a meeting in order to correct our actions.

Rushailo intends to make a tour of Chechnya, visiting various residential districts and checkpoints, since there are reports that guerrillas and even mercenaries are trying to enter liberated districts of Chechnya through checkpoints. It is possible that today Rushailo will visit Shali and Argun. He said that the system of passport control will be tightened. This should apply to all residential districts of Chechnya, not Argun or Shali alone.