Publication: Monitor Volume: 4 Issue: 167

Russia’s new Prime Minister Yevgeny Primakov last night denied that his government would return Russia to communism. He told a TV interviewer he would not abandon market reforms but said that there must be “corrections” to previous policies to overcome the “awful divide” in society in which the majority of the population lives below the poverty line. This was Primakov’s first major interview since his approval on Friday by the State Duma by 317 votes to 63 with 15 abstentions. He said his aim is a “socially oriented” economy that will include protection for domestic producers and a greater role for the state in managing the economy (NTV, September 13).

Primakov said he would submit a list of new cabinet members to President Boris Yeltsin by the end of the week. His first appointments have not inspired confidence among western observers and Russia’s dwindling ranks of reformers. The first appointment was of communist Yuri Maslyukov, the last head of USSR Gosplan, the Soviet state planning agency. Maslyukov is now to be first deputy premier in charge of economic policy. Maslyukov said last night that his appointment means “a change of course, but not the end of reforms” (RTR. September 13). He said he would unveil his plans to stabilize the ruble today (Ekho Moskvy, September 13).

There was particular dismay in the reform camp over Yeltsin’s nomination, enthusiastically approved by parliament on Friday, of Viktor Gerashchenko as chairman of the Central Bank. Gerashchenko headed the Bank from 1992 until “Black Tuesday”–October 11, 1994, when the ruble fell 27.4 percent against the dollar and Gerashchenko was fired. During his tenure, Gerashchenko printed money with enthusiastic abandon and came into constant conflict with then Finance Minister Boris Fedorov. Whether Fedorov will remain in the cabinet is not yet known. Yesterday, Primakov said that the idea to return Gerashchenko to his old job came from a group of Russia’s biggest private bankers. Gerashchenko confirmed that he favors support for “efficient” banks and “a small, controlled emission” of new money (Russian agencies, September 11).

Gerashchenko has already dismissed the Central Bank board of directors and proposed a number of new candidates. There was gloom on the reform front when it was realized that Gerashchenko intends to remove from the board the first deputy chairman of the Central Bank, reformer Sergei Aleksashenko. Hopes that the appointment to the government of Maslyukov and Gerashchenko would be balanced by the entry to government of Yabloko leader Grigory Yavlinsky were also dashed when Yavlinsky announced over the weekend that he was not interested in a cabinet post (Russian agencies, September 11).

Meanwhile, Primakov appointed Ivan Ivanov to replace him as foreign minister. The Kremlin confirmed that Igor Sergeev, Sergei Stepashin and Sergei Shoigu are remaining as ministers of defense, interior and emergency situations, respectively. Primakov said he would include some regional governors in his new cabinet (Russian agencies, September 11).