Publication: Monitor Volume: 3 Issue: 136

Russian and Chechen government officials meeting in Moscow on July 11 signed long-awaited customs and banking agreements, removing all remaining obstacles to the signing of a general political agreement between Moscow and Djohar-gala. The agreements also cleared the way for the signing, in Baku on July 12, of a key tripartite agreement between Russia, Azerbaijan, and Chechnya on the transit of early Caspian oil along the Baku-Djohar-gala-Novorossiisk route (the "northern variant"). The trilateral agreement was signed by Russian first deputy prime minister Boris Nemtsov, the head of Azerbaijan’s State Oil Company (SOCAR), Natik Aliev, and the head of Chechnya’s Yuzhnaya Oil Company (YUNKO), Khozh-Akhmed Yarikhanov. The trilateral agreement had been Moscow’s main goal in its negotiations with Djohar-gala. Azerbaijani leaders had warned that, if the agreement was not signed, early oil would be shipped by routes which skirted Russian territory — through Georgia to the port of Supsa and through Turkey to Ceyhan.

The Moscow agreements were signed despite a threatened walk-out by the Chechen delegation, which accused Moscow of trying to introduce last-minute changes to the banking agreement. Moreover, the signing of the banking accord appeared to reflect concessions by Djohar-gala. The Chechen side’s proposal to give Chechen banks unlimited access to the accounts of Russian commercial banks was rejected. Instead, the banking agreement stipulates that all transactions of Chechen credit organizations with Russian banks will take place only through an account in the Central Bank of Russia. Money from the account may be used to buy foreign currency and Russian government securities through the Central Bank of Russia only on the instructions of Chechen president Aslan Maskhadov. (Segodnya, July 12)

The customs agreement appears also to have been signed on terms favorable to Moscow. This document envisions the participation of the Russian side in patrolling not only the border between Chechnya and Russia proper, but also Chechnya’s external border with Georgia. It may be that Shamil Basaev’s recent resignation from his post as first deputy prime minister was triggered by this part of the agreement. It is likely that Basaev, who was also the chairman of the republic’s Customs Committee, did not want to share his authority with Russian representatives. (Nezavisimaya gazeta, July 12)

Earlier progress in the Russian-Chechen negotiations became possible only after both Moscow and Baku made substantial concessions and deferred to Chechnya’s long sought goal to be recognized as an equal participant in the transit of Caspian Sea oil. After that success, Maskhadov tried once again to use his sole lever of economic pressure on Russia by insisting that the oil transit agreement could be signed only "together with the other economic documents". (See the Monitor, July 10) But this may have been primarily a negotiating ploy. Djohar-gala was no less interested than Moscow in the "northern variant" and, once it understood that no further concessions would be forthcoming, agreed to sign the agreements on Russian conditions. (RTR, NTV, Radio Moscow, July 11-12)

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