DUMA DEBATES BUDGET.

The Russian State Duma is today debating, in the first of four required readings, the government’s proposed 1998 federal budget. A minimum of 226 votes is required for approval. The draft has been substantially amended since October’s stand-off, when the Duma rejected the government’s original version and referred it to a government/parliament conciliation commission for reworking. The government says the budget is essential to enable it to get Russia’s battered finances onto a healthy footing. Yesterday, Communist Party leader Gennady Zyuganov, who heads the Duma’s largest faction, declared that the 149-member Communist faction would reject the budget today.

Zyuganov indicated that the Communists would try to use the budget as a lever to persuade President Boris Yeltsin to sack his beleaguered first Deputy Prime Minister Anatoly Chubais. The Communists’ threat to reject the budget has, in other words, less to do with the merits or demerits of the revised budget itself than with the continuing political standoff between the government and the opposition. Zyuganov’s latest threat seems unlikely to produce results: Yeltsin has made it clear that he intends to keep Chubais in the government "for now." The Speaker of the Duma Gennady Seleznev, himself a Communist but more amenable to compromise than many members of the faction, predicted yesterday that the budget will eventually be passed. If not, he noted wearily, Yeltsin would be "within his rights" in threatening to dissolve the Duma. (Reuter, RTR, Itar-Tass, December 4)

A Russian government spokesman was quoted this morning as saying that Russia is close to completing its negotiations with a group of western banks for a bridging loan of some $2 billion. (BBC, December 5) The government urgently needs the money to meet President Yeltsin’s promise to pay off wage arrears of around $1.6 billion to federal employees by the end of the year.

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