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Известия Молдавские МиГи

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Moldovan MiGs Deal Example of 'Banana Republic' Arms Sales

CEP20001123000108 Moscow Izvestiya in Russian 23 Nov 00

[Semen Novoprudskiy report: "Fighters Are Ineradicable" -- taken from HTML
version of source provided by ISP]

[FBIS Translated Text]

Russia is a comparatively well-to-do country. But we are left from certain
deals transacted by our businessmen and even the government with a mixed
feeling of profound regret and an affectionate compassion for the country.
How about, for example, merely the government guarantees for the contract
with the Swiss Noga firm--Russia was dragged through international courts,
and Russian diplomats in Paris went for several months without pay, and the
epic story involving the detention in the French port of Brest of our
sailing vessel "Sedov" just about caused a far-reaching diplomatic row.

But if we, despite our wealth, are so wretched at handling the state's
commercial possibilities, what can be said about countries that are much
poorer. The bureau of the parliament of Moldavia yesterday adopted the
decision to return to the problem of the sale to the United States of 21
MiG-29 fighters. We are talking about Moldavia's loss of a great deal of
money.

It was like this. Following the disintegration of the USSR, Moldavia came in
for 27 MiG-29 fighters. Three years ago the government of Moldavia sold the
United States 21 of the aircraft for a sum total of $80 million. According
to the terms of the deal, $40 million were to have been paid to the
Moldavian treasury (which is what happened), the Americans swearing to
supply for the remaining $40 million goods and uniforms for the Moldavian
national army. It is about the fate of this part of the money that nothing
is known. Some deputies maintain that the Americans settled accounts for the
fighters in full, but the money fetched up in overseas accounts of
influential Moldavian politicians.

Meanwhile, $40 million are for Moldavia truly a large sum. It is sufficient
to say that the annual revenue of the Moldavian treasury amounts to little
more than $200 million, and Moldavia's foreign debt, on the other hand, is
in excess of $1.2 billion. But if you think that the deputies have decided
to recreate the picture of what happened from a disinterested love for the
truth, you are greatly mistaken. Three years from the time of the deal the
members of parliament are not ultimately particularly interested in its
outcome.

The reason for the present fit of curiosity is a deal involving the sale of
the remaining six fighters that has turned up. They underwent major overhaul
in Belarus, and now the government is looking for buyers. So it was that
members of parliament (and the parliament in Moldavia has the most power of
all the countries of the Commonwealth) wanted to ascertain where the money
from the past deal went. And at the same time to participate in the new
deal. Valeriu Pasat, minister of defense of Moldavia at that time and now
director of the Information and Security Service, could be the main "point
man". He has been invited by the Moldavian members of parliament to
"testify".

Military-technical cooperation with the world is, generally, assuming truly
barbaric forms in the post-Soviet states. In Kazakhstan the inquiry into the
circumstances of arms deals resulted in a far-reaching scandal, in which
people close to the president proved to be mixed up. Russia, for which arms
exports remain a most important item of export income and bring in the
treasury more than $5 billion annually, just cannot create some in any way
strong and efficient mechanism of the sale of weapons. The latest Putin
edict on this score is yet another attempt to centralize arms exports, but
it is not certain that it will prove successful.

All in all, the attempts of poor countries to sell all that is in
temptation's way, moves, and could bring in at least some money can no
longer evoke a soft indulgence. Government officials in these small, poor,
and none-too-proud countries clearly feel themselves to be time-servers, and
they are for this reason contriving to get rich as quickly as
possible--before the moment of their involuntary "transfer to other work".
But, all the same, in the ninth year of independence public officials might
already have become accustomed to the thought that they are officials of an
independent state and that the quantity of property in temptation's way and
capable of moving and of bringing in if only some money has sharply
diminished--there will soon be nothing of it left at all.

It is greatly suspected, though, that "fighters" are ineradicable. Until the
new independent states have stable economic growth and a meaningful
political system, deals with "the property of a banana republic" will be
transacted at the highest level and with enviable periodicity. Russia is in
this respect a reputable country only in comparison with the even poorer and
even less civilized post-Soviet states. So several more Noga's could emerge
here also.

[Description of Source: Moscow Izvestiya in Russian -- One of Russia's most
prominent dailies, now controlled by Vladimir Potanin's Oneksimbank.]
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