The Times (UK)

30 July 1997

[for personal use only]

Chernomyrdin takes control of arms sales

FROM ROBIN LODGE IN MOSCOW

THE Russian Prime Minister, Viktor Chernomyrdin, is to take personal control of sales by the country's main arms export agency, Rosvooruzheniye, after newspaper reports of illegal sales and the diversion of proceeds.

Other Russian companies have accused the multi-billion pound state arms agency of using aggressive tactics to keep domestic competitors out of the lucrative market. Criticism has also come from America over concerns about the large volume of Russia's international arms sales.

This month the weekly newspaper Novaya Gazeta accused Rosvooruzheniye of illegal arms sales last year and diverting the proceeds to support President Yeltsin's re-election campaign. Aleksandr Kotelkin, the agency's general director, has denied any wrongdoing and has accused critics of attempting to discredit Rosvooruzheniye to prevent it signing big contracts.

"Propaganda campaigns against Rosvooruzheniye ... usually surface on the eve of signing a major contract," Mr Kotelkin said. He referred in particular to a deal being negotiated to sell Indonesia MiG 29 and Sukhoi 30 strike aircraft, along with guided missiles, radar and helicopters. It follows Indonesia's cancellation in May of a plan to buy nine American F16 fighter jets.

In another deal, the agency signed a contract with Cyprus in January to supply it with S 300 ground-to-air missiles, effectively neutralising the air superiority of Turkey in the region.

---------------------

Johnson's Russia List

#1099

30 July 1997

djohnson@cdi.org