. T in'sWreasury man. i*:'.* .. s-.'v "• » FINANCIAL TIMES /fc-jrQpo’s • I'-5r-5 Cusr-os?, Newspaper V. r r Hfc , WEDNESDAY APRIL, 28 1 993 08523* j • ‘'cfc. Serb forces attack .V’KCiv Government likely to try to approve credit controls tomorrow Congress Moslems as tough ba :' threat to UN sanctions start Russia risks social n&i ••'-]. ' Serb forces defied the Internationa) community end EBRD by launching an attack in Moslem-held north-west Bosnia just as tough United Nations sanctions came into force against Belgrade. Fighting also erupted funding V* in other parts of former and economic chaos *^ Yugoslavia, one day after Bosnian Serbs refused r By Georgs Graham to accept an international peace plan signed by In Washington rival Moslems and Croats. Page 16; Bosnia conflict reports. Page •• --«! 3 THE US Congress is likely to Rate cut urged: Pressure on Germany to help without fast reform refuse any further money for the speed up European growth intensified when Michel European Bank for Reconstruc- Camdessus, International Monetary Fund managin g tion and Development as a result By John Lloyd in Moscow director, said a "substantial decrease” in German said the government was not in are a small and embattled minor- of the outcry over excessive control and ity. interest rates was appropriate. Page 6; G7 to he expected “there Mr Boris Fyodorov, deputy spending on salaries, private air- RUSSIA faces financial collapse could focus on global economy. Page 6 be hyperinflation by the prime minister in charge of craft and office fittings. and risks a social explosion that if autumn. People don't understand finance, has claimed of the The Clinton administration has Merger move: The New York Mercantile President Boris Yeltsin fails to what hyperinflation means, and 117 people of ministerial rank in requested J70m In its 1994 budget Exchange proposed a $10m merger put with New radical economic reforms so we will have to live through the government, only four under- for the US's share of the EBRD's York's Commodity Exchange, in a move that into place immediately, western one before we get stabilisation." stood the market system: Mr paid-up capital, but senior mem- would create the world's fourth largest futures economists and Russian officials The government meets tomor- Anatoly Chubais, deputy premier bers of Congress warned yester- and options market Page 28 warned yesterday. row and is likely to try to for privatisation; Mr Alexander day that they would almost cer- The dominant fear in Moscow approve the economic measures, Shokhin, deputy premier for for- Blow for Patten: Election victories by tainly refuse the request is that between and elec- affaire now including a control on credits, eign wmnnmir ; Mr Shakh- is share- pro-Beijing businessmen have left the board of The US the largest tions - which could be held this delayed by the referendum cam- rai and himself the Hong Kong General Chamber of Commerce holder in the EBRD, which has a autumn - the pre-referendum paign. The latest Yeltsin appointment evenly split between supporters and opponents total of 56 shareholders. The US practice of keeping voters happy Mr Grigory Yavlinsky, a promi- was Mr Oleg Lobov, an old ally of accounts for cent of Chris Patten, the colony's governor. Page 16 10 per of the by delaying harsh reform mea- nent economist and a candidate the president but deeply sceptical bank's capital. :* ,l:, VW tries to calm nerves of suppliers sures and issuing boundless cred- for the presidency, believes the of radical reform. He is now first Senator Patrick Leahy of Ver- l; tnanagwmonf its to avoid - The top bankruptcies would government also represents “an deputy prime minister in charge mont, the Democratic chairman • ' continue. - • 1‘j of Volkswagen attempted enormous compromise with con- of the economy vying with the of the Senate committee that con- to calm the nerves Mr Sergei Shakhrai, deputy servative forces, which means Other first deputy, Mr Vladimir trols foreign aid spending, gave a of component-makers prime minister for nationalities that it is no longer able to control Shumeiko and outranking Mr warning that he planned to rattled by the company's and an important aide to Mr Yelt- Inflation, but is simply a forum Fyodorov at the finance ministry. reduce the EBRD budget alloca- plans to slash costs sin, said that without decisive for the political struggle”. This issue is expected to be the tion to zero unless very substan- and reduce outside action, “the rouble will disappear Since Mr Yeltsin has con- subject of heated debate at the Speaker Ruslan Khazbulatov, President Yelsttn's chief rival, has tial changes in the bank's man- suppliers. The meeting, by the autumn" as more people structed a compromise cabinet to cabinet meeting tomorrow. warned that parliament will ignore the referendum result agement were made. k attended by representa- lose confidence in it placate the centre ground, whose Mr Vassiliev said even the radi- He said yesterday: l win not tives of 29 companies, Mr Sergei Vassiliev, head of the support he needs, he will not dis- cal ministers had not been able dent figipes show there is likely chairman. Too many government vote for one cent of money from was intended to counter government’s Centre for Eco- turb the balance before new elec- to get a strong grip on credit to be a rise to 20 per cent or more ministers issued credits without the US for the EBRD unless I see - ill-feeling and fears nomic Reform, said there were tions though Mr Shakhrai said expansion. This would lead, he this month and more in May, as reference to each other. very, very substantial move- stirred by the arrival “strong political imperatives now there will be a “reshuffle of said, to the recent Call in inflation raised pensions make an impact ments towards reform - not at Europe's largest for delay in reforms. Mr Yeltsin posts'* in the next few days. from 27 per cent a month in Jan- The fault, Mr Vassiliev said, Nation divided by money, power promises of reform. There will car maker of Jos& Ignacio should right now implement Within this cabinet, the radical uary to about 15 per cent last lay not only with Mr Victor and sentiment. Page 2 not be one cent in my proposal Lopes (left), recently tough policies, but he won’t” He ministers best known to the west month being reversed. Indepen- Gerashchenko, the central bank Editorial Comment, Page 15 unless I see that, and frankly I recruited from General Motors and installed as don't think I am going to.” production and procurement director. Page 16 Mr Leahy delivered a scathing "* indictment of EBRD's spending • Political veteran accuses magistrates of conspiracy as Senate lifts immunity American Telephone and Telegraph, largest Fed moves and of its chairman, Mr Jacques :>. -C US telecommunications operator, is challenging Attali “I want to know why we British Telecom to agree to more than halve the should entrust another dime of “wholesale” price of transatlantic phone calls. the public’s money to Mr Attali,” Page 16 to prop up Andreotti faces mafia links probe he said. "It's almost like this Anger over delay: Mexico's ruling Institutional money that has gone in there is a Revolutionary Party provoked a storm by postpon- By Robert Graham in Roma in Italy as the symbol of the bers abstained, backed- by two cases against senior mafia mem- slush fund for personal use." value of political ing elections for governor in the state of Yucatan and Haig SimorSan in Mian establishment long con- Socialists and the president of bers. The evidence is based Republican members are likely extensively from November this year to May 1995. Page 6 trolled by the. Christian Demo- the commission, while one Lib- on testimony of for- to follow the Democrats on the AN ITALIAN Senate commission crats. eral voted against him losing his mer mafia members co-operating EBRD. Senator Mitch McConnell Mobil, big US energy group, reported a first the dollar yesterday agreed to waive the Yesterday he issued an angry immunity. with the authorities. of Kentucky, Mr Leahy’s Republi- profit share), quarter 1993 net of $490m <$1.19 a parliamentary immunity of Mr statement repeating his view that Mr Andreotti revealed on • Mr Gabriele Cagliari, the for- can counterpart on the foreign against a loss of S319m last tune, following account- By Jamas Bfitz in London and Giulio Andreotti, seven times the investigation by Palermo March 27 that he had been noti- mer chairman of Italy’s publicly- operations spending committee, ing charges. Page 19 George Graham in Washington Christian Democrat prime minis- magistrates was a conspiracy to fied by Palermo magistrates they owned Eni energy and chemicals said: “Short of immediate ter, closer *1 to investigate him for group, yesterday admitted to hav- changes in the policies prac- Space deads The Russian space industry signed bringing him one step denigrate him. He added: have wished and Federal Reserve to being investigated by Palermo absolutely no fear of the truth alleged links with the mafia. The ing paid L26bn ($l7m) in illegal tices of the EBRD, I - like the its first contract to launch a western satellite, THE US intervened on the foreign magistrates far alleged coflusion and will vigorously use every Senate commission has been contributions to the Christian chairman - cannot support the worth $36m, in what it hopes will be the first exchange markets yesterday, with the Sicilian means to unmask these incredi- hearing the case since April 14, Democrat and Socialist parties. administration's request for step into a lucrative western market.