NEWSBRIEFS (06/08/97)

NEWSBRIEFS

Budget to pass by month's end

KYIV - Verkhovna Rada Budget Committee Chairman Mykola Azarov predicted on June 3 that the five-month overdue 1997 budget would be passed by the end of this month. "I predict that we will pass the budget around the last week of June. Once we get the final draft, deputies will require about two weeks to give it a second (final) reading," said Mr. Azarov. The International Monetary Fund is waiting to extend a $2.5 billion to $3 billion long-term credit once Ukraine passes the budget and a package of tax reform laws to underpin it. Verkhovna Rada Chairman Oleksander Moroz told national deputies the government would hand the draft over to Parliament on June 5. Mr. Moroz said the Parliament could begin debating the draft the following week - and would simultaneously give preliminary approval to an initial draft of the 1998 budget. The government and the Verkhovna Rada have blamed each other for the record delay in adopting a budget, which Parliament initially approved last December and returned to the government for revisions. The Parliament is to start its summer recess on July 18. According to the Ministry of Finance, the budget forecast gross domestic product at 100.4 billion hryvni ($54.6 billion) and the deficit was forecast at 5.7 percent of GDP, compared to 6.2 percent in 1996. It also forecast annual inflation at 24.9 percent, against 39.7 percent last year. This year marks the longest period the budget has been delayed since independence in 1991. According to Ukrainian law, a budget must be adopted by January 1 of each year. (Reuters)

Moscow restates opposition to Sea Breeze

KYIV - The Russian Federation has not changed its negative view of plans for NATO naval exercises off the Crimean peninsula in August, despite the recent Ukrainian-Russian agreement on the division of the Black Sea Fleet, a Kremlin spokesman said on May 30. "We see certain anti-Russian hints in these exercises," spokesman Sergei Yastrzhembski said, referring to the "Sea Breeze '97" exercises that will include the Ukrainian navy. Russia declined an invitation to take part. "We consider the exercises to be counterproductive, and they cannot contribute to the security of the Black Sea region," he told the press after Russian President Boris Yeltsin's arrival in Kyiv to sign the Ukraine-Russia friendship treaty. (Reuters)

Bomber sale suspended

KYIV - Ukrainian Defense Minister Col. Gen. Oleksander Kuzmuk told ITAR-TASS on June 4 that Ukraine has decided to keep several bomber aircraft it was intending to sell to the Russian Federation. Col. Gen. Kuzmuk said Ukraine had planned to sell to Russia 25 Tupolev Tu-160 and Tu-95MS bombers as agreed upon two years ago, but he added that the two countries have been unable to settle on a price for the aircraft. Russian Vice Prime Minister Valerii Serov said Russia might decide against purchasing the aircraft because it has no funds for repairs. Col. Gen. Kuzmuk neither confirmed nor denied that Russia has backed out of the sale. He said only that "the question has been suspended" and "it is unclear when it will be settled." (RFE/RL Newsline)

Daewoo finishes phone exchange plant

SEOUL, South Korea - Daewoo Telecom completed an exchange manufacturing plant on May 27, according to company sources. Named Dnipro-Daewoo, the factory was set up with a joint investment of $10 million between Daewoo and the Dnipropetrovsk Machine Building Plant on a 50/50 basis. The joint venture will churn out exchanges capable of accommodating 3 million circuits over the next 10 years. The exchanges will be exported to former Soviet republics and Eastern Europe as well as Ukraine. Only 17.5 of every 100 Ukrainians owns a telephone. There are plans to expand the number of subscribers by 2 million by 1999. (Asia Pulse)

Pope hopes to lead Church into 2000

GNIEZNO, Poland - Speaking at an evening service in southwestern Poland on June 2, Pope John Paul II asked his countrymen to pray for him so that he can lead the Roman Catholic Church into the next millenium. The service was attended by nearly 400,000 people. The pontiff, who was on an 11-day trip to his homeland, said his mentor, the late Cardinal Stefan Wyszynski, had told him he would be the pope to take the Church into the third millennium of Christianity. On June 3 the pontiff met with the presidents of Germany, Ukraine, the Czech Republic, Lithuania, Slovakia, Poland and Hungary to commemorate St. Adalbert, a medieval Czech missionary and martyr. (RFE/RL Newsline)

Demydenko out; Franchuk back

SYMFEROPOL - The Verkhovna Rada of the Crimean Autonomous Republic named Anatolii Franchuk to the post of prime minister on June 4, replacing Arkadii Demydenko, who had been blamed for economic problems and faced repeated no-confidence votes. Mr. Franchuk, an in-law of President Leonid Kuchma, had previously served in the same post. The Crimean deputies' decision awaits approval by the Verkhovna Rada of Ukraine. (Reuters)

Russian cars now made in Crimea

SYMFEROPOL - The closed joint-stock company KrymAvtoGazServis has begun production of Russian-designed Volga cars, InfoBank reported on May 26. About 1,500 Volga GAZ-31029 models are expected to roll off the assembly line annually. According to General Director Anatolii Lazarev, production of Volgas with Toyota diesel engines will begin in two and a half months. The plant will also produce Hazel trucks with Toyota diesel engines. Nikolai Pugin, president of the GAZ plant in Nizhny Novgorod, Russia, which makes the Volga, said the Symferopol plant was one of the most promising auto manufacturing facilities within the CIS. He said he saw no immediate threat in a plan by South Korea's KIA Motors to begin assembling cars at the More plant in Feodosia at the end of 1997. KIA initially expects annual production of up to 20,000 cars, with long-range plans for a yearly output of 60,000. (Eastern Economist)

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