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Technology Stocks : Rostelecom (ROS) the Russian Telecom Company

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To: Rob Shilling who wrote (48)10/18/1998 3:41:00 PM
From: Urlman   of 80
 
Sunday October 18 7:35 AM EDT

Embattled Yeltsin Rests Amid Calls He Resign
By Peter Graff

MOSCOW (Reuters) - Russian President Boris Yeltsin spent the weekend resting at a country house amid continuing calls that he should step down and a threat by parliament that it would try to force him out.

A recovery in Russia's nearly wiped-out stock market last week gave a small sign that the country was beginning to stabilize after months of political and economic turmoil.

But Interfax news agency reported that serious crimes such as murder and rape had surged by nearly 18 percent in the first nine months of 1998 over the same period last year, an alarming sign of the social crisis caused by deepening poverty.

Yeltsin, who defied doctors' orders and confounded critics by showing up at work last week despite an illness that forced him to cut short a trip to central Asia, spent the weekend at his country lodge in Zavidovo, outside Moscow.

But the Kremlin said he would be back to work Monday, holding a meeting with Prime Minister Yevgeny Primakov. The Kremlin says he is recovering from a respiratory infection, although Russia's media speculates his condition is much worse.

Russia's benchmark RTS1-Interfax stock index closed the week up more than 30 percent on the previous week, a rare sign of buoyancy in the country's equities since its market was all but completely obliterated by the country's financial crisis.

The index had lost some 90 percent of its value this year as Russia's finance ministry edged closer to bankruptcy, its banking system teetered and the rouble went into freefall.

But trading volumes remain so thin that dealers are reluctant to ascribe any long-term meaning to the week's bounce.

Former Soviet leader Mikhail Gorbachev added his voice to the growing chorus calling on Yeltsin to step aside.

''On October 7 millions of people demonstrated in the streets of Russian cities,'' he wrote in The New York Times. ''Their main demand was for the resignation of President Yeltsin...It was a clear verdict on the regime and the sort of 'shock' reforms that the country has had to endure for seven years.''

The Communist speaker of the State Duma lower house of parliament, Gennady Selznyov, said the chamber may proceed in November with the process of impeaching Yeltsin on charges he illegally dissolved the Soviet Union, dispersed parliament in clashes in 1993 and launched a war in breakaway Chechnya.

Although the complicated impeachment procedure is unlikely to be brought to a conclusion, it will provide a stage for politicians from across the broad political spectrum to practice their anti-Yeltsin rhetoric.

In an interview published over the weekend, the former prime minister who was sacked in August after allowing the rouble to slide and halting some debt payments said the administration that followed his had brought the country to the brink of a devastating default on sovereign debts.

''The misfortune was that talk began of a coalition government,'' Sergei Kiriyenko told the business newspaper Kommersant Daily. ''Who will take responsibility for measures that are clearly painful to the population?''

''The answer has become clear: there will be no harsh anti-crisis program. Instead there will be populist measures, again expenditures will exceed revenues. As a result, we will not be able to pay our debts. In short, we are heading toward a default on sovereign debt,'' he said.

A full-blown sovereign debt default would make Russia into a ''pariah with whom nobody will do business,'' he said.

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