Publication: Prism Volume: 3 Issue: 21

The Fortnight in Review

Russia: Budget Debate and Yeltsin’s Health Top the News

The fortnight began on December 5 with an unprecedented visit by President Boris Yeltsin to the State Duma, where he appealed to Russia’s recalcitrant parliamentarians to approve the 1998 federal budget in the first of four statutory readings. In the past, Yeltsin had resolutely refused to address the Duma. On the eve of his surprise intervention, the Communist-dominated chamber had declared its intention of rejecting the budget, or of accepting it only in return for a government reshuffle that Yeltsin had indicated would not be forthcoming. Following Yeltsin’s appeal, the Duma meekly voted 231 in favor of the budget to 136 against.

Two days later came news that the president had been confined to a sanitarium with what his doctors said was an "acute viral infection." Coming on top of reports of Yeltsin’s eccentric behavior during a recent state visit to Sweden, the announcement sparked concern that the president might be suffering from something more serious, such as a recurrence of his former heart disease. Yeltsin’s indisposition derailed the roundtable that had been planned for December 11 between the president and parliamentary and regional leaders. The roundtable had been set to discuss the vexed topic of land reform. The president is determined to bring about the establishment of a land market in Russia, while the Duma is equally as determined to keep land out of private hands.

Yeltsin appeared in public on December 14 to vote in a local Moscow election. He admitted that he was weak and "not feeling good," but his spokesman insisted that the president was making a strong recovery and would be back at work in the Kremlin by the end of the year.

Regions Boost Land Reform

Yeltsin’s sickness had two immediate consequences. One was that Russia’s ever more autonomous regions decided to go their own way on the land issue. Leaders of some of Russia’s most powerful regions met in Kazan on December 8 to discuss land reform at the regional level. The meeting took its inspiration from Saratov Oblast, where a ground-breaking regional law legalizing the free sale of agricultural land recently came into force. Tatarstan’s president, Mintimer Shaimiev, suggested that a way could be found of circumventing the impasse between president and parliament by shelving the land code that is the sticking point between them, and adopting framework legislation on a federal basis. Once such a framework was in place, individual regions would be able to move ahead with their own legislation, taking account of regional specificities.

Constitutional Reform Derailed

Yeltsin’s illness also derailed what had looked like a move toward informal constitutional reform via the back door. There had been signs that, together with regular meetings of the "Big Four" (the president, the prime minister, and the speakers of the two houses of parliament), the new institution of a roundtable might offer a way out of the deadlock created by Russia’s 1993 constitution, under which the president has immense power and parliament has very little. This situation is blocking the progress of democratization in Russia and preventing the emergence of an effective opposition. Constitutional Court chairman Marat Baglai has faithfully repeated Yeltsin’s assertions that it would be "hasty" to think about amending the constitution at the present stage, but recent weeks have shown both the need for such reform and the improbability that it will be realized in the near future. In its place, new, extraconstitutional forms of dialogue between president and parliament seemed to be emerging that could circumvent the need for full-blown constitutional reform .

The IMF to the Rescue?

Concern over Yeltsin’s health prompted jitters on Russian financial markets, already hit by an exodus of investors after recent turmoil in Asia. The economic outlook brightened when the International Monetary Fund announced that it had decided to release the latest $700 million tranche of its $10.2 billion loan to Russia. The IMF suspended the loan in October, citing Russia’s poor tax collection record. The Russian government heaved a sigh of relief on December 12, when the Fund’s mission in Moscow said it was now satisfied with Russia’s budgetary policy. "The mission is confident that, provided the fiscal and monetary policies agreed during the review are fully applied on a sustained basis, the prospects for the Russian economy in 1998 are positive," the IMF statement said. Many observers suspected that the IMF had bent the rules to free the loan to Russia. Combined with recent moves by the Russian Central Bank to raise interest rates, the IMF’s decision to resume funding eased short-term financial pressures on the Russian government but did little to resolve the country’s long-term need to tackle its fiscal problems, in particular, the need to improve tax collection. after the end of 1998.

Russia and U.S. Clash Anew Over Iraq

A month after a Russian diplomatic initiative had raised some small hope of an end to the crisis in the Persian Gulf, tensions between Iraq and the UN were back in the headlines this week — and at the center of Russian-U.S. relations. Moreover, the adversarial roles played by Moscow and Washington remained the same, as was evident during a meeting between Russian foreign minister Yevgeny Primakov and U.S. secretary of state Madeleine Albright in Brussels on December 17. Albright used the meeting, which occurred on the margins of a two-day gathering of NATO foreign ministers, to urge Moscow to pressure Baghdad into granting UN weapons inspectors full access to Iraqi government buildings. She also restated Washington’s conviction that a resort to military force must remain an option should the Baghdad authorities remain defiant. Primakov disagreed, arguing that the crisis could be defused only by political means. He also made the point that Moscow’s position enjoys the general support of the international community.

Exploiting Transatlantic Rifts

Primakov’s last point was a telling one. The consensus that once prevailed on the UN Security Council with regard to Iraq has eroded amid a welter of conflicting political and economic agendas. Moscow and Paris, casting an eye on a series of lucrative energy deals signed by Russian and French companies with Iraqi authorities, have an obvious economic interest in bringing a quick end to UN sanctions. Russia in particular is looking also to its friendly ties with Baghdad as one means of rebuilding its influence in the Persian Gulf and throughout the Middle East.

Domestic developments in the U.S., including a series of actions by the Congress that have embittered Washington’s European allies, have further eroded U.S. efforts to forge a consensus behind a firm policy on Iraq (and also its efforts to maintain Iran’s diplomatic isolation). Moscow has been quick to exploit these trans-Atlantic rifts, as it did, for example, in September, when Russia’s Gazprom joined a $2 billion French-led deal to develop a major Iranian gas field. The U.S. protested loudly but to no avail. The Kremlin has also appealed to European leaders in recent months with the argument that U.S. influence on the continent should be reduced. Russian leaders have urged their European counterparts to include Russia in a greater Europe that would act more independently of the U.S.

Cooperation with NATO Moves Forward

In addition to the Albright-Primakov meeting, Brussels also was host on December 17 to the second meeting of the Russia-NATO Permanent Joint Council (PJC) at the level of foreign minister. Primakov used that gathering to reiterate Moscow’s continuing opposition to NATO’s policy of enlargement, and the two sides reportedly clashed over Russia’s demand that future PJC meetings include on their agendas discussion of NATO’s plans for modernization of military infrastructures in newly admitted member states. NATO officials had rebuffed Russia on this same point earlier, including at a December 4 meeting (the first) of PJC Chiefs of Staff. Primakov was apparently given the same message on December 17, with NATO leaders conceding only that they would make full "transparency" a hallmark of their work in this area with newly admitted Eastern and Central European states.

Despite such differences, the meeting was described as a constructive one. The two sides approved a PJC Work Program for 1998 aimed at boosting Russia-NATO cooperation and at enhancing security in Europe. The program includes a number of priority issues to be the subject of discussions and information exchanges, including the defense policies and military doctrines of NATO and Russia, defense budgets, disarmament and arms control, and peacekeeping. The program also calls for ongoing cooperation under the Partnership for Peace program and in a host of other areas. Russia also expressed during the meeting its desire to remain a part of any follow-on NATO peacekeeping force in Bosnia, but Primakov specified that the Russian troops will be authorized to use force only in extreme situations and within the limit of their mandate. That qualification appeared to reflect Moscow’s ongoing opposition to operations aimed at arresting accused war criminals in Bosnia.

CIS: Symptoms Emerge of a Slow Unraveling

The anniversary of the creation of the Commonwealth of Independent States passed with minimal official notice in Moscow and virtually none in the capitals of the other 11 member countries. Former Ukrainian president Leonid Kravchuk — who on December 8, 1991, joined with Russian president Boris Yeltsin and Belarusan head of state Stanislau Shushkevich to found the CIS — remarked that the organization has gradually been emptied of any strength, having "turned into a shell. Its decisions mean nothing. This organization has no prospects." Kravchuk himself contributed significantly to this course of events — as did his successor Leonid Kuchma — by treating the CIS as a means toward a "civilized divorce" from Moscow.

Wistful Prescriptions in Moscow

In the Russian capital, CIS executive secretary Ivan Karatchenya (a Belarusan and a Moscow loyalist) expressed the ritualistic hope that Ukraine would eventually join the Russia-Belarus Union. Falling back on pan-Slavic ideology, Karatchenya mused that Ukraine’s accession "would result in the formation of that genuine Slavic Union, which used to be so much talked about in the past in our countries, and which currently so frightens certain Western politicians."

Russia’s CIS cooperation minister, Anatoly Adamishin, marked the anniversary with the factual observation that "integration among CIS states does not exist, because the decisions have no binding force. There are no supranational bodies, and progress is impossible in their absence." Unlike Karatchenya, Adamishin took the position that the Russia-Belarus-Kazakhstan-Kyrgyzstan customs union could potentially serve as the unifying core — "if these four states were to find common ground." In that case, "it would be easier to organize [the CIS] around such a core than around Russia."

Recommending yet another approach, Russian Federation Council chairman Yegor Stroyev called for deferring systematic "integration" efforts until Russia is itself ripe to serve as the core. "After our country will have strengthened its economy and stability, and only in that perspective, Russia will be able to speak of its dominating role as unifier." Stroyev was addressing a session of the CIS Interparliamentary Assembly’s Council, a meaningless body that he chairs.

The three prescriptions for curing the CIS differ in that one of them takes a pan-Slavist approach, the second a Eurasian one, and the third a national Russocentric. But they evidence a broad common denominator in that they all regard Russia as the real force behind any CIS "integration;" envisage it as a dynamic process that would add successive layers onto a Russian center; and value such integration as an accretion to Russia’s power.

Lukashenka: Moscow’s Unruly Yet Valued Ally

Writing in his administration’s official newspaper, Sovetskaya Belorussia, Belarusan president Alyaksandr Lukashenka warned that "the fate of the CIS will be easy to predict" if it continues "wasting time on discussions and explanations, without taking any specific decisions," as was the case at recent CIS summits. For the upcoming summit in Moscow, Lukashenka proposed the creation of a standing supervisory body, comprised of personal representatives of the CIS countries’ presidents, and empowered to monitor the implementation of collective decisions in the economic area. The watchdog body would work out a mechanism of sanctions for noncompliance with decisions and would "coordinate" the work of central CIS economic organs in Moscow. In several accompanying statements, Lukashenka stressed that he had been the sole CIS president to defend Yeltsin against general criticism at the recent Chisinau summit.

Notwithstanding its "integrationist" rhetoric, Lukashenka’s proposal is actually driven mainly by national interest as he understands that interest. His main goal here is to pressure Russia to deliver on its largely unhonored promises of economic support to Belarus. Superimposing a collective presidential organ above the CIS central staffs would ipso facto dilute Russia’s dominance of those staffs. While Lukashenka stresses the economic functions of the CIS and a bilateral "economic union" with Russia, Moscow is interested primarily in a political and military alignment with Belarus. Russia remains ambivalent about assisting Belarus economically, and is in any case poorly placed to do so; but, at the same time, official Moscow has closed its eyes to Lukashenka’s dictatorial rule. Articulating this policy on a visit to Minsk, Russian prime minister Viktor Chernomyrdin advised the public and the mass media back home to "separate the development of the Russia-Belarus Union from politics" and to "recognize the main thing — Russia’s strategic interests."

While Chernomyrdin spoke, Russia’s first deputy defense minister and chief of the general staff, Gen. Anatoly Kvashnin, and his Belarusan counterpart, Gen. Mikhail Kozlov, finalized a concept of common defense. The head of the Russian General Staff’s Main Department for Operations, Lt. Gen. Yury Baluyevsky, described the concept as a model for the creation of "regional defense systems" in other areas of the CIS. The idea is to set up "coalitional forces" that would place troop contingents of newly independent countries under Russian command in several regions of the former USSR.

Some influential Russian liberals similarly regard the Belarusan dictator as a valued ally to an isolated Russia. Expressing this view, Yabloko’s Vladimir Lukin — chairman of the Duma’s Foreign Affairs Committee — listed recent setbacks of Russian policy in Europe and in the CIS and added: "Russia’s policy toward Belarus must take into account not only the violations of human rights and freedoms there, but also the Ukrainian factor, the CIS factor, and international circumstances." Translation: Lukashenka’s Belarus is useful as a counterbalance to Ukraine, as an ally within the CIS, and as an outpost that faces the enlarging NATO.

"Guam" Group Formed to Promote Common Interests

In the last days of November, Presidents Eduard Shevardnadze of Georgia, Haidar Aliev of Azerbaijan, and Petru Lucinschi of Moldova conferred in Tbilisi and Baku within the framework of a newly created grouping, dubbed GUAM for Georgia-Ukraine-Azerbaijan-Moldova. The three presidents and their Ukrainian counterpart, Leonid Kuchma, had signed the founding agreement the preceding month at a quadripartite meeting. Kyiv, Chisinau, Tbilisi, and Baku envisage the following: mutual support in upholding national interests within the CIS; coordination in resisting "separatism" and in seeking international support to settle regional conflicts; joint efforts to promote the Transit Corridor Europe-Caucasus-Central Asia (TRACECA) project, which bypasses Russia; and delivery of Caspian oil across Georgia and the Black Sea to Ukraine and Moldova in order to reduce their dependence on Russian fuel.

Three of these countries have been defeated by domestic secessionist movements: in Transdniester, Abkhazia, and Karabakh, respectively. While each of these situations has its own specifics, Russian support for secessionist forces and manipulation of the conflicts is a common feature. Moldova and Georgia have therefore welcomed Ukraine’s stated willingness to participate in peacekeeping operations in Transdniester and Abkhazia. Azerbaijan, which has no Russian troops — of the "peacekeeping" or any other variety — on its territory, has called for the withdrawal of Russian troops from neighboring Georgia and Armenia.

Ukraine is also emerging as a nucleus of a joint military force now in the planning stage. On December 14, Ukrainian defense minister Oleksandr Kuzmuk announced that Kyiv and Tbilisi have agreed to form in short order a Ukrainian-Georgian battalion, and that Baku has agreed to join a tripartite battalion in the next stage. The unit or units are intended to provide security on transportation routes leading from the Caspian Sea to Ukraine.

The GUAM countries have carefully avoided sounding confrontational toward Moscow. They maintain that GUAM is not directed against the interests of "any country," and prefer to emphasize its economic dimension rather than the security and political dimensions. Similarly, they have avoided leaving the impression that GUAM is splitting the CIS; instead, they take the position that the CIS has not outlived its usefulness and that the summit scheduled for January in Moscow represents an opportunity to reform the organization. They stress that GUAM is intended as consultative grouping, not a bloc or alliance. Yet they also point out unambiguously that GUAM is based on the four countries’ common interests on key issues and is planned for the long term. Just as significantly, they imply that the grouping has the potential to develop functionally and to acquire new members.

Georgian Parliament Sends Warning Signal

At an extraordinary sitting on December 16, the Georgian parliament unanimously resolved to set up four special commissions that are mandated, respectively, to report on: whether it is appropriate for Georgia to remain a member of the CIS; whether Georgia should continue hosting Russian military bases on its territory; the country’s progress in creating a national army and its own border troops with a view to replacing the Russian border troops stationed in Georgia; and the merits of the CIS (meaning Russia), the UN, and the OSCE, respectively, in mediating a settlement of the Abkhazia conflict.

Initiated by the opposition, the extraordinary sitting and the resolutions were accepted by the governing majority with the added proviso that the commissions would be given four months to present their conclusions and proposals. The parliament acted against the background of a Russian-engineered deadlock on Abkhazia and a series of incidents involving the Russian military in Georgia. (See the Jamestown Monitor, December 5, 10, 12) Georgia’s counter-leverage is modest, and the four-month timeframe is designed to avoid precipitating an all-out confrontation. Nevertheless, the parliament’s reaction and the consensus behind it in effect signals to Moscow that it must either improve its conduct toward Georgia or lose some military facilities in the country while incurring political embarrassment in the CIS and internationally.

Central Asian Union Slow to Develop

While the four GUAM countries are closing ranks in the space around the Black and Caspian seas, a regional grouping is also slowly emerging in Central Asia. It is the Central Asian Union, comprised of Uzbekistan, Kazakhstan, and Kyrgyzstan, whose prime ministers — Utkir Sultanov, Nurlan Balgimbaev, and Apas Jumagulov, respectively — met on December 8 in Tashkent. They discussed the activity of the joint Central Asian Bank and the creation of tripartite consortiums in specific economic sectors. On December 12, in Kazakhstan’s new capital, Akmola, Presidents Nursultan Nazarbaev of Kazakhstan, Islam Karimov of Uzbekistan, and Askar Akaev of Kyrgyzstan met and approved the plan. They resolved to focus on joint investment projects in water management and hydropower, mineral extraction, and food processing. Akaev commented that "the three countries, in contrast to the CIS, only undertake projects that can be carried out in practice." Karimov warned against attempts to pit Central Asian countries against each other — "a business at which our former brother to the north is particularly adept." And Nazarbaev observed that "if the CIS keeps failing to ensure mutual advantage and equality of treatment for member countries, then the CIS will have turned into something that should not even exist."

Officially launched earlier this year, the plan to create the consortiums is moving at a snail’s pace. The joint bank exists, but it suffers from shortage of capital and problems of mutual convertibility. The three countries are signatory to an agreement to establish a "common economic space" as part of the Central Asian Union. Its slow start, notwithstanding the Union’s very emergence and agenda, illustrate the trend toward fragmentation of the CIS into subgroups of countries, which associate with one another on the basis of their own interests and regional criteria, outside of Russia’s shrinking orbit.


"The Fortnight in Review" is prepared by Senior Analysts Elizabeth Teague (Russia), Stephen Foye (Security and Foreign Policy), Vladimir Socor (Non-Russian republics), and Analyst Igor Rotar.

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