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London, Thursday, June 5, 1997 

On Eve of Vote, Algerians See Glimmer of Hope 

No. 35.53 

By John Lancaster 

Washinxion Post Service 

ALGIERS — There are times in this balmy sea- 
side capital, with its cypress trees and whitewashed 
villas and air of faded colonial elegance, that life 
seems almost normal. 

Women lick ice-cream cones on a sun-splashed 
street corner. A small girl embraces two loaves of 
French bread. Bursts of color erupt from tiny flower 

Then comes the dull thud of another bombing, and 
Algerians are jolted back to the present. 

On Thursday, the war-weaiy citizens of this vast 
North African country will vote in their first par- 
liamentary elections since 1992. when the govern- 
ment canceled multiparty balloting that Islamic fun- 
damentalists were jxrised to win and, in doing so, 
unleashed a tide of political violence that so far has 
claimed an estimated 60,000 lives. 

While the government views the election as a 

chance to restore some of its lost legitimacy, the main 
Islamist opposition party, now officially banned, has 
denounced it as a fraud and urged voters to stay 
home. The runup to the election has been maned by 
a surge in violence that over the Iasi few months has 
killed several hundred people, many of them women 
and children massacred in villages near Algiers with 
swords, axes and even chainsaws. 

Tensions also have beat rising in the capital, which 
has been hit with almost daily bombings that au- 
thorities acknowledge have killed 22 people and 
injured 120 in the last week alone. Another bomb 
apparently went off here this afternoon, sending up 
black smoke from a hilltop a few miles from the 
heavily guarded Aurassi Hotel, where most foreign 
journalists are staying. Government officials at the 
hotel, however, said they had no information on the 
incident and barred reporters from visiting the scene. 

After a campaign season tainted by allegations of 
rigging in favor of the pro-govemment National 
Democratic Rally — and a constitutional amend- 

ment last year that sharply limited the powers of the 
380-seat National Assembly — many Algerians are 
deeply cynical about thecommitmeni’of the military - 
backed regime, headed by President Liamine Zer- 
oual, ro multiparty democracy. 

Virtually no one expects the election to have any 
immediate effect on the level of violence, which has 
been attributed largely to armed Islamic militants but 
also has implicated members of govemmenr security 
forces. But for all its obvious limitations, many 
Algerians view the competition among more than 
7,000 candidates from 39 parties — including two 
that represent the Islamic trend — as at least a starting 
point for dialogue and eventual reconciliation. That 
view is shared by Western governments, including 
the United Suites, which has dispatched a 14-mem- 
ber election monitoring team io Algeria and en- 
couraged other countries to do the same. 

“The elections don't mean much in terms of the 

See ALGERIA, Page 10 

Key Labor Pact 

Chemical Workers Will Accept 
Pay Reductions in Bad Times 

South Korea 
By Scandals 

Student Riots Leave 
Government Reeling 

By Mary Jordan 

IVizrlu/igitin Post Sen -ice 

SEOUL — The South Korean cap- 
ital . where noisy student protest is a way 
of life, has been struck this week by a 
series of anti-corruption demonstrations 
that have surprised the city with their 
intensity and violence. 

Since a nationally televised speech 
Friday, when President Kim Young Sam 
I conceded that the money-soaked polit- 
ical system had forced him to spend 
“huge amounts” in his 1992 campaign, 
thousands of students, carrying fire- 
bombs and iron bars, have been rioting. 
- All week long, the capital has been 
teeming with riot police; uniformed men 
with tear gas and rubber batons are posted 
at nearly every subway stop. More cruise 
the city in buses reinforced with steel 
cages. A riot policeman was killed 
Monday night; apparently an armored 
riot vehicle backed up and crushed him in 
the chaos of thousands of students smash- 
ing police with steel rods and chanting, 
“Down with Kim Young Sam.” 

[A second death was reported Wed- 
nesday as student radicals admitted they 
had tortured a 23-year-old worker to 
dead) because they believed he was a 
police informant, Agence France- 
Presse reported.] 

Despite the violence. Mr. Kim has so 
far declined to fully engage in the debate 
over his campaign financing. He refuses 
to say how much campaign money he 

S in 1992. or exactly where it came 
critics say he may have spent 
S400 million, 10 times the legal limit. 

The president has not been charged 
with doing anything wrong. In fact, 
many people say he has done his best to 
change a system that works only when 
greased with graft They credit hum with 
important reforms to die nation's bank- 
ing laws that make it harder to hide dirty 

Still, the current scandals have 
severely hobbled Mr. Kim in the last 
year of his presidency. His plummeting 
public-approval ratings have left South 
Korea without a strong leader at a cru- 
cial time in dealings with North Korea 
and when the United States is pressing a 
v igorous trade agenda. 

Mr. Kim is prohibited by law from 

See KOREA, Page 10 

8 Years After Tiananmen, a Tale of Two Chinas 

A candlelight vigil Wednesday in Hong Kong, above, while security was tight in Beijing, below. Page 4. 

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By Edmund L. Andrews 

A'w K> ri Timex SrrviVv 

FRANKFURT — Unions represent- 
ing Germany’s 600.000 chemical work- 
ers agreed Wednesday to a contract that 
opens the possibility for troubled 
companies to reduce wages by 1 0 per- 
cent. The pact offers a significant bow 
toward workplace flexibility in a coun- 
try’ that has lost more than a million jobs 
in five years. 

The new contract, which covers 
about 1,700 companies, including gi- 
ants like Hoechst'AG. BASF and Bayer 
AG, is the most dramatic departure yet 
from the iron-clad work rules that gov- 
ern most employers in Germany "and 
many other European countries. 

It comes at a time when more than 1 1 
percent of Germany's workers are job- 
less and its companies are building fac- 
tories in Eastern Europe, Asia and Latin 
America. Tlie mounting insecurity' over 
standort Deutschland* German compel - 
itiveness, has provoked reams of debate 
here about the country’s purported in- 
flexibility and prohibitively high costs 
of doing business. 

The contract breaks with the status 
quo in two important ways, and could 
become a model for other collective- 
bargaining in other industries. 

First, it would allow companies that 

are in serious economic distress to ask 
local unions for wage reductions of up 
to 10 percent in exchange for promising 
not to lay off workers. 

Second, it gives individual compa- 
nies much greater ability to break loose 
from the industry-wide rules thal now 
govern workers and employers 
throughout a particular industry. 

“If ihe other unions go in the same 
direction, ihe German sivle of collective 
bargaining would be dead.” said Wolf- 

German social crisis pits young vs. 
old in battle Tor benefits. Page 10. 

gang Scheremec. a labor economist at 
the German Institute for Economic Re- 
search in Berlin. 

The contract "breaks through to a 
new* age.” Hans Terbrack, lead nego- 
tiator lor 1. G. Chemie. the chemical 
workers' union, said after reaching 
agreement with industry negotiators 
Tuesday night. Dieter Hundu head of 
the chemical industry' s trade associ- 
ation, said the agreement was a “clear 
step in the right direction.” 

And Werner Stumpfe. head of the 
heavy industry association, called the 
agreement “correct, important and 

Sec LABOR, Page 10 

Jospin Fills Cabinet 
With a New Generation 

Communists Given Transport and Sports 

By Joseph Fitchett 

hilernuiionjl HerjU Tribune 

PARIS — Prime Minister Lionel 
Jospin formed a Socialist-led govern- 
ment Wednesday that embraced’the en- 
tire spectrum of the French left, in- 
cluding Communists. 

Key posts went to prominent young 
Socialist politicians, including Domi- 
nique Strauss- Kahn as minister of fi- 
nance, economy and industry, and Mar- 
tine Aubiy as minister of employment, 
whose brief is the top priority of rhe new 

The Communists were given the trans- 
port and youth and sport portfolios. 

Hubert Vedrine was named foreign 
minister, a sensitive post in the prime 
minister's potentially uneasy relations 

Three ex-government ministers 
under investigation. Page 6. 

with President Jacques Chirac, whose 
Gaullist party was ousted by the So- 
cialists in elections Sunday. 

In the cabinet lineup, a particularly 
conspicuous absentee was Jacques De- 
lors, a former finance minister and 
foirner president of the European Com- 
mission. whose presence would have 
been seen internationally as a gauge of 
economic moderation. 

In particular. Germany sets store in his 
commitment io European integration. 

Mr. Delors. 71, was not offered a 
ministry even though he had indicated 
willingness to join the cabinet. Socialist 
sources said. 

Perhaps too independent for Mr. 

Murderous Rage of the Russian Army 

Rampaging Killers, Hazing and Suicides Reflect a Military in Despair 

By Lee Hockstader 

Washington Pt at Service 

MOSCOW — One of the more com- 
monplace ways for Russian soldiers to 
die these days is not in the heat of battle 
w even in training mishaps. It is at the 
hands of a comrade-in-arms gone ber- 

In (he past week alone, 16 Russian 
servicemen have been killed in two sep- 
arate incidents, in each of which a sol- 
dier. armed with an automatic weapon 
^ amok. In the fast 15 months, at least 
49 people lave died in 14 reported ra- 

Muiwaatan d Price* [ 

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j.Clipra*. M- ..,c.Ei.OO Nigeria ...125,00 Naira 

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■.Gbrriiar -£0.85 Rep. betold.jR£UX3 

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jjtaaan 1250JD UAE. .10.00 DMi 

— K.SH.160 US. ML (Eur.) ~S 1.20 
|W»a* 700 FIs Zn*8bws,_.ZrrL$30n0 

stances of a soldier going on a rampage 
and killing officers, members of his unit 
or others. 

The incidents constitute yet another 
measure of the degradation and demor- 
alization of the Russian armed forces. 
The troops — poorly paid, led and fed 
— constitute a threat mainly to them- 
selves, analysis say. Suicides, hazing, 
mistreatment of troops and killings have 
become so frequent that some news- 
papers no longer bother to report them 
on the front page. 

When the newspaper Komsomol- 
skaya Pravda requested a comment 
from the minister of defense, the paper 
was given the brush-off by the armed 
forces’ chief spokesman. General 
Anatoli Sharalov. For die minister to 
make a public statement, the general 
said, “something more important has to 
happen.” He said more people were 
killed in automobile accidents than in 
shooting s p re e s by soldiers. 

Given toe life that army recruits lead, 
and the growing violence in Russian 
society, many people here seem not to 
feel a need for explanations. 

“It reflects the stress that the soldiers 
and the Russian Army are under, and in 
general the social stress of Russian so- 
ciety,” said Pavel Fdgengauer, a mil- 
itary analyst with the newspaper Se- 

vodnya. “Most of these killers are not 
seasoned officers going off the hook but 
young soldiers whose lives were already 
tough before the army.” 

He added: “When they get into the 
army, it’s a case of double stress.” 

The Russian military, humiliated in 
Chechnya and forgotten at home, re- 
sembles a fighting force from a different 
and much earlier era. Conditions in the 
field often are primitive, particularly in 
comparison with those, experienced by 
well-supplied Western armies. 

Because of budget shortfalls and cor- 
ruption, decent food is in such short 
supply that thousands of soldiers are 
underweight and some suffer from mal- 
nutrition. Hie daily newspaper Mos- 
kovskii Komsomolets, citing statistics 
from the military prosecutor’s office, 
reported in January that many service- 
men were receiving fewer than half of 
the daily calories they needed. 

“Soldiers in most units haven’t seen 
fresh meat, milk or eggs since summer 
and mostly subside on canned food,” 
the newspaper said. “Even bread is 
becoming a luxury, as many units live 
on emergency rations.” 

Hazing is also a problem in the 1.5 
million-member armed forces, and it is 

See RUSSIA, Page 10 


UN Extends Iraqi Oil-for-Food Sales 

(Combined Dispatches) — The Se- 
curity Council agreed unanimously 
Wednesday to extend Iraqi oil-for- 
food sales for another six months de- 
spite complaints from both Washing- 
ton and Baghdad about implemen- 

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AW* the 100-Mile Ultra Marathon 


Helms to Block Envoy to Mexico 


India Denies Missile Deployment 

ration of the program. The 1 5-member 
council refused Iraqi requests to in- 
crease (he amount of oil it can sell to 
buy food and medicine for its people, 
who are suffering the effects of years 
of international sanctions. 

But the council said it would look 
favorably on exlending the program 
for a third, six-month period if there 
were no major problems during the 
second phase. 

Iraq and China, meanwhile, on 
Wednesday signed an agreement to 
develop an Iraqi oil field in a deal 
worth more than $1 .2 billion, the Iraqi 
oil minister, Amer Mohammed 
Rashid, said. 

He said the agreement would come 
into effect on Thursday, but did not 
specify whether development work 
would begin before the lifting of the 
seven-year-old UN oil-anti-trade em- 
bargo on Iraq. (A P. AFP) 

Books Page 6. 

Crossword Page 11. 

Opinion Pages 8-9. 

Sports Pages 22-23. 

Sponsored Section Pages 19-21. 


The IHT on-line http://iwAv.iht.oom 

Jospin in the cabinet. Mr. Delors could 
still serve as a special troubleshooting 
ambassador, they said. 

The new foreign minister, Mr. 
Vedrine. was the diplomatic adviser, 
then chief of staff, to the late President 
Francois Mitterrand, a Socialist, and 
served as the main liaison between Mr. 
Mitterrand 3nd Mr. Chirac when the 
rightist was prime minister from 1 986 to 

Mr. Vedrine, along with Elisabeth 
Guigou, who was named justice min- 
ister in the new government, worked 
closely under Mr. Mitterrand to nurture 
French-German cooperation, negotiate 

See FRANCE, Page 6 

NATO Fears 
Paris Re-entry 
Is Now Dead 

By Craig R. Whitney 

Vfi Kvi I'mr.s Sinwe 

BRUSSELS — According to diplo- 
mats at NATO headquarters here, the 
election of a new Socialist government 
in France probably gave the coup de 
grace to President Jacques Chirac's of- 
fer at the end of 1995 to bring French 
officers back into alliance military struc- 
tures thal they left three decades ago. 

“It would be a misreading of the 
situation to say that Chirac was in favor 
and the new government against,” an 
authoritative NATO diplomat said. 

“But after much debate and months 
of discussions, he has concluded that the 
Americans were not ready to give Euro- 
peans the increased command respon- 
sibilities he set as a condition of going 
back in.” 

The new Socialist prime minister, 
Lionel Jospin, said during his campaign 
for the legislative elections that his party 
won last Sunday that he thought Mr. 
Chirac and his conservative government 
had done a poor job of bargaining with 
the United Slates. 

“He announced at the outset that 
France would go back in, giving up his 
best card at the beginning, and that was 
the best way to ensure that he would get 
nothing in remm,” Pierce Guidoni, Mr. 
Jospin's key foreign policy adviser, said 

A few months after Mr. Chirac said 
that France would subordinate its troops 
to the alliance if the United States 
agreed to restructure NATO and cede 
more power to Europeans, he made 
European control over the NATO 
Southern Command in Naples, where 
the U.S. Sixth Fleet is based, a key 

The White House, the State Depart- 
ment and the Pentagon, supported by 
many of Washington's allies in Europe 
all turned him down. 

Tempers flared at the end of last year 
but six months ago Mr. Clinton ordered 
U.S. officials to begin exploring pos- 

See NATO, Page 10 


Ultra-Marathoning / Endurance of Pain 

Runners Who Go 
To Extreme Lengths 

By David Nakamura 

Washington Pop Service 

W OODSTOCK, Virginia — 
Under a bhie-black sky lit 
only by the sliver of a yellow 
moon. King Jordan wakes for 
his morning run ar the foot of the Shen- 
andoah mountains. 

Mr. Jordan, 53, is the president of Gal- 
landet University in Washington, and he 
runs daily. What is different, however, is 
the lengths be will go for his runs, and the 
pain he will endure to finish them. 

Over the next 24 hours, Mr. Jordan will 
throw up, lose a handful of toenails, sweat 
off up to five pounds (two kilograms) of his 
body weight and limn to the end with 
painful blisters on his feet. 

On this early morning, in addition to his 
running shoes, cap, T-shirt and shorts, Mr. 
Jordan straps on a fanny pack carefully 
loaded with water, fruit bars, chocolate, 
Band-Aids, Vaseline, cotton swabs and 
other miscellaneous items. 

Fully stocked, Mr. Jordan meets dozens 
of similarly outfitted runners at4 AM. at a 
bam on the county fairgrounds. They gath- 
er to begin an undertaking that can seem 
almost cult-like to outsiders, but one they 

consider simply the ultimate expression of 
a runner's wUL 

Eigbty-eightmen and women have come 
from all over the United States to try to run 
100 miles (160 kilometers) in less thaa 24 
hours in the Old Dominion Endura nce 

These runners, who range in age from 19 
to 66, have paid $125 apiece for this op- 
portunity. They will run over steep hills and 
rocky trails and through dense forests. 

The swiftest will approach a 10-minutes- 

majority will not complete the coarse 
until early the next morning in otter dark- 
ness — and in utter pain. 

“People think it’s crazy/' said Mr. 
Jordan, who is the first deaf president of 
Gallaudet, a university for the deaf. 

He chuckles, and joins the others at the 
starting line. The music from “Chariots of 
Fire” blares through a hastily constructed 
public address system, and the runners take 
off on a half-mile loop of the fairgrounds, 
then jog through the sleepy town before 
climbing the first steep, winding trad into 
the mountains. 

There will be no prize money, even for 
the victors, and no national recognition. For 
their efforts, those who complete the cbal- 

Rldl Liplu/Tfcc U'J-hjnplou had 

King Jordan reaching an aid station 64 miles into the 100-mile endurance run. 

tOeh lipdd/n* WaWnglwi Pen 

Janice Anderson finishing seventh at the Shenandoah County fairgrounds. 

lenge will be rewarded with an Old Domin- 
ion Run belt buckle — and they could not 
be happier. 

rapidly growing sport bom in the 
late 1970s after the initial run- 
ning boom in the United States. 
Not satisfied with the standard 26.2-mile 
marathon, a group of runners founded the 
Western States 100 in Squaw Valley, Cali- 
fornia. in 1974. 

The Old Dominion Run was started five 
years Inter by Pat Botts, now 57, and her 
husband, Wayne, now deceased. 

* 'It's a challenge, being able to deal with 
whatever comes along,” said Tom Green, 
46, who was attempting to earn his 1,000- 
mDe Old Dominion Run buckle, signifying 
10 finishes under 24 hours. “You never 
know what’s going to happen, what’s going 
logo wrong.” 

Lots of things c an go wrong. Last year, 
Lisa Smith, a 36-year-old from New Jersey, 
was leading the women's division when 
she got lost in the woods and needed an 
hour and a half to regain her way. 

She dropped out ax the 86-mile mark 
after urinating blood. Even Mrs. Botts. who 
developed the course, fainted one year dur- 
ing a steep, narrow portion of the trail 
Even though training matters — the run- 
ners run about 40 to 100 miles per week — 
experience does too, which is why 51 of the 
competitors are 40 years old or older. 

Twenty miles into the race, at the first 
“aid station,” where runners are permitted 
to get assistance from their support crews, 
James Garcia, 38, a mechanical engineer 
from Massachusetts, arrives first in 2 hours 
40 minutes. Three minutes behind are Dan 
Barger, 31, of California, and Robert 
. Youngreu, 22, of Minnesota. 

Aid stations are similar to a pit stop in car 
racing. Runners grab water, chips, cookies; 
they change shirts and shoes. They can 
even sleep if they so desire. 

Mr. Jordan's wife, Linda, is working as 
his support crew along with Marcia Mont- 
gomery, whose husband, Al also is com- 

By the 47-mile aid station, runners are 

be ginning, to drop out. Mr. Jordan reaches 
that mark around 2 PM., approximately 
two hours behind the leaders, and throws 
up. Hie continues to have stomach problems 
until he reaches die 64-mile point, where 
his wife feeds him crackers, which settle his 
five system. 

r. Montgomery is hours behind Mr. 
Jordan, and drops out at the 47-mile point 

The final 25 miles of the race are the 
toughest, beginning with Elizabeth Fur- 
ance forest, where runners can team with a 
pacer for 11 treacherous miles. Mrs. Botts 
reaches that point suffering from a lack of 
sodium in her blood, causing her hands and 
feet to swelL 

She is taken to Shenandoah Valley Me- 
morial Hospital where she will spend the 

At sunset, Mr. Barger emerges from the 
mountains and finishes first in 17:04, an 
average of 10 minutes 14 seconds per mile. 
His time is two hours slower than die 
course record of 15:10 set by Eric Clifton in 
1992, but it is a personal record by four 
hours for Mr. Barger. 

Janice Anderson, 31. is the first female 
finisher, arriving at 10:25 PM, for a time 
of 18:25. She is seventh overall and is 
followed by Lisa Smith and Martha Swatt, 
putting three women in the top 10. 

I T IS DARK out again now. Mr. Jordan 
is still in the mountains. He has got a 
second wind. At midnight, he hardly 
stops at the final aid station, 10 miles 
from the finish. He has one final hill to 
climb, followed by a winding descent and a 
two-mile jog through town. 

Finally, after 2 in the morning, Mrs. 
Jordan and Mrs. Montgomery cheer Mr. 
Jordan across the finish line with a time of 
22:10, good for 19th place. His finish is 25 
minutes slower -than-fcis- personal -record,- - 
but he has earned his fifth Old Dominion 
Run buckle. 

“I think I would like to find a chair,” he 
says, hobbling toward dote bam. His legs are 
caked with mud. “I was lucky to finish as 
fast as I did. I was really sick.” 

In all 40 runners complete the course 
within 24 hours, and 55 finish overall. 

should i — r - 

African heads of state meet*" 
ing in Harare, Zimbabwe, 
the annual Organization of' 
African Unity meeting have* 
-jven Nigeria’s military ef- 

More Evacuations 
For Sierra Leone 

Negotiators Arrive in Freetown 
In Hope of Averting New Battles 

The Associated Press 

F REET OWN, Sierra Le- 
one — France and Ghana said 
Wednesday that they were 
CTf i fmu fri g international ef- 
forts to rescue foreigners 
trapped by a militar y coup 
ana avert . a resumption of 
fighting as coup leaden 
showed no- signs of relaxing 
their hold on this capital 

Ten days after ousting the 
civilian government, support- 
era of the coup leader. Major 
Johnny Paul Koromah, 
roamed the streets, machine 
gnus slung over their 
shoulders, harassing drivers 
at roadblocks. 

Soldiers were occupying 
the badly damaged Mammy 
Yoko Hotel the scene of 
fierce battles Monday, and 
looting was _ reported 
throughout the city. Looters 
struck the residence of the 
elected president, Ahmed Te- 
jan Kao bah, who fled to 
neighboring Guinea during 
the May 25 coup. 

A G hanaian delegation led 
■ by Victor Gbeho, deputy for- 
eign affairs minister, and 
G hana 's military chief of 
staff, Seth Obeng, planned to 
begin negotiations Wednes- 
day with Major Koromah’s 

The delegation arrived in 
Freetown on Tuesday as U.S. 

Marines were conducting 
their third airlift of foreigners 
since fire coup. The delega- 
tion’s aim was to prevent a 
resumption of battles that 
broke out Monday after Ni- 
geria, which backs the ousted 
government, launched an as- 
sault aimed at driving out Ma- 
jor Koromah. 

The effort failed, prompt- 
ing Nigeria to send in more 
troops Tnesday and raising 
fears of new bloodshed 



Major John . Milton, a/' 
spokesman for the rating *j 
junta, told repeaters that Ma-. 
jof Koroman’s forces had 1 *, 
captured 30 Nigerians since'*' 
Monday. He did not say 1 ’ 
where they were being held or . 
why they were detained, and 
there was no confirmation " 
from the Nigerian govern-'" 

- Another military ■ spokes^’* 
man. Colonel Abdul Sesay, ;* 
said later that the Nigerians '' 
had been released. 

Despite international dip-' 
lomatic efforts to restore calm ‘ 
in Freetown, foreigners have 
been fleeing by the thou-.; 

Ghana evacuated 1,000 of;! 
its citizens Tuesday, and a~ 
spokesman for the French- 
Foreign Ministry, Jacques 
Rummeihardt, said two 
companies of French marine?! 
led a new operation to SieoaJ 
Leone on Wednesday to cany 
out more foreigners. He did 
qot specify their nationalities, 
and further details were not 

Nearly 500 Lebanese, 
evacuated on chartered boats, - 
arrived in Beirut early Wed^ 
nesday. They sailed from" 
Freetown on evacuation 
ships, then flew out o£ 
Conakry, Guinea. “■* 

U.S. Marines on Tuesday , 
airlifted more than 1,200.* 
people — including 38 Amer-- 
icans — to the warship, 
Kearsarge offshore. Since' 1 
Friday, U.S. helicopters have; 
ferried about 2,400 foreigners, 
from the city. ,j 

travel update Close Call, in Aviation Terms, for Clinton’s Jet 

In-Flight Deaths Are on the Rise 

LONDON (Reuters) — More airline passengers are dying 
from heart attacks and other medical emergencies than in 
plane crashes. New Scientist magazine reported in its issue for 
release Thursday. 

Data from the Federal Aviation Administration show that the 
number of in-flight medical emergencies has soared in the past 
decade to 14,000 each year on the nine major U.S. airlines. 

Overall, about 350 passengers a year die on board planes 
operated by U.S. carriers, while an average of 118 passengers 
a year have died in air crashes on U.S. soil since 1978. 

Thailand Moves to Bolster Tourism 

BANGKOK (AP) — Thailand has started a campaign to 
double the number of tourists by the end of the decade by 
promoting shopping. Thai food and convention facilities. 

The goal of the Tourism Authority is to raise the number of 
visitors from 7.2 million in 1996 to 17.1 million in 1999. 

Torrential rain soaked Mexico’s Pacific coast as a trop- 
ical storm packing 74-ktiometer-per-hour (46-miJe-per-bour) 
winds, headed toward land Wednesday. Mexican authorities 
closed some southern ports ahead of the storm, which was 
south of the resort of Huatulco, and moving easL (AP) 


AUGUST 7 -10, 1997 

If you uere, or you know someone who was, a participant 
in the Herald TribuneAVorid Youth Forum (either Dec- 
March or summer programs), please contact us for details 
of the Association and the reunion: IHT Box 293, 92521 
Ncuillv Cedex or 

Catherine Marin (33 1) 47 72 12 15 

Daniels Yaffe Zidon (1 914) 2452279 

By Don Phillips 

Washington Post Service 

presidential jet, Air Force 
One. with President Bill Clin- 
ton aboard, was told to turn 
and climb as it approached the 
Irish coast on May 27 to avoid 
a United Parcel Service 747 
freighter descending across 
its path several miles ahead, 
according to U.S. officials. 

The president and his wife, 
Hillary, were not in danger as 
air traffic controllers at Shan- 
non. Ireland, noticed the pos- 
sible conflict, or converging 
paths, and told both planes to 
take evasive action. 

Air Force One, flown by 
Major Jeff Krausert, also re- 
ceived a warning of possible 
conflict ahead from its auto- 
matic Traffic Alert and Col- 
lision Avoidance System 
shortly before controllers in- 

But pilot union officials 
said there might have been a 
technical violation of minim- 
um separation standards be- 
tween the aircraft. The Inde- 
pendent Pilots Association, 
which represents parcel ser- 
vice pilots, made the incident 
public as part of an effort to 
persuade the Federal Avi- 
ation Administration to re- 
quire freighter aircraft like the 

cargo plane to be equipped 
with collision-avoidance sys- 
tems similar to the one aboard 
Air Force One. 

In the incident. Air Force 
One was flying from An- 
drews Air Force Base near 
Washington to Orly airport 
south of Paris on the first leg 
of a European tour by Mr. 
Clinton. UPS Flight 6080 was 
flying from Cologne to Phil- 

A parcel service spokes- 
man. Ken Shapero. said the 
two aircraft “ were never on a 
collision course,” and an An- 
drews Air Force Base spokes- 
man, Major Jim Stratford, 
said the incident was “an ex- 
ample of how the system 

Controllers did their jobs. 
Major Stratford said, adding 
that the president's pilots said 
there was never any danger. 

The Air Force One pilots 
estimated three miles (five ki- 
lometers) of horizontal sep- 
aration and 1,000 feet (300 
meters) vertical separation 
between the two planes. The 
parcel service pilot, Dom De- 
vito. estimated the horizontal 
separation closer to two 

Under a new program al- 
lowing reduced vertical sep- 
aration over the ocean, 1,000 
feet would have been suffi- 

cient But not all parcel ser- 
vice aircraft are certified for 
the program because they do 
not have newly calibrated al- 

Captain Fleet Smith, an in- 
vestigator for the pilots union, 
said the uniou wanted to make 
die point that the collision- 

avoidance system works, and 
that it should have been 
aboard the parcel plane. 

Mr. Shapero said the parcel 
service had been working on 
an advanced collision-avoid- 
ance system teat will be more 
reliable and precise than the 
one aboard Air Force One. 

German Prosecutors Urge 
Acquittal of Arson Suspect 


LUEBECK, Germany — German prosecutors took foe 
unusual step Wednesday of demanding an acquittal for a 'f" 
■Lebanese man charged with stinting a fire- that killed - 1 0 
?le, saying there was not enough evidence to convict 

“The trial has not produced enough evidence to con- 
vict him,” a state prosecutor, Michael Boeckenhauer, 
told the court “Therefore the accused must be acquitted, 
even if that judgment wouldn't fit with the final truth.” 

The Lebanese man, Safwan Eid, has been on trial since 
September on charges of aggravated arson and causing 
bodily harm after a fire at a refugee hostel in January 1996 
killed 10 people and injured 38. 

Mr. Eid, who also lived in the hostel, has denied all 
charges. The defense still has to sum up its case before the l 
judge delivers a final judgment ** 

The police arrested Mr. Eid, a civil war refugee, ou 
suspicion of trying to get revenge in a petty quarrel with 
another resident The fire killed six people from Zaire, a 
man from Benin, a Lebanese and a woman from Angola 
and her 6-year-old daughter. 

Mr. Boeckenhauer said that despite the testimony of 
about 1 00 witnesses there was no exact information about 
how the fire started, although U was clear that the blaze 
brake out on the first floor of the hostel. 



































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it accompanied. The photograph showed Peggy Broxterman, 
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Forecast tor Friday through Sunday, aa provided by AccuWesther. 


North America 

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across the Northeast Fri- 
day and Saturday, bui 
showers are possible Sun- 
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most ol the West showers 
and thunderstorms are 
likely, even In the South- 
west. Southern Texas to 
eastern New Mexico wtll 
have ehowere and thunder- 


Warmer weather with 
soma sunshine is In store 
far much o/ centre/ Europe 
from Italy and Austria north 
across Poland and the 
Baltic region. Cloudy with 
showers across France, 
England and Spain; soafc- 
fag ruin te tito/y in southern 
England. Cod with show- 
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BeVng wB have some sun 
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turn cooler Sunday. Party 
sunny In Seoul, but show- 
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Friday, than some sun 
through Sunday. Humid 
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"Helms to Block Choice for Mexico Envoy 

By Steven Lee Myers 

New York Times Service 

Helms, the chairman of the 
Senate’s Committee on For- 
eign Relations, has indicated 
that he will block President 
Bill Clinton's choice to be the 
oe^t ambassador to Mexico, 
Governor William Weld of 

Mr. Helms. Republican of 
North Carolina, whose com- 
mittee clears ambassadorial 
nominations before the full 
Senate votes on confirmation, 
sharply criticized the choice 
in a television interview 

,*‘!f they want a hearing on 
it, on that opening, on that 
amb assadorship, they ought 
to get somebody else,” he 
said in an interview with Fox 
News Channel that was re- 
corded for broadcast on Wed- 

Without a hearing, a nom- 
ination cannot move for- 

*Jn particular, Mr. Helms 
cited the criticism of Mr. 
Weld by conservative Repub- 
licans in Massachusetts, who 
have long considered the gov- 

lips sometimes and that sort 
of thing,” Mr. Helms aHHud. 

Bat AmcadoWTbe Amocoed Pm 

Mr. Weld responding at 
the Boston statehonse to 
Mr. Helms’s comments. 

emor too liberal because of 
his views on social issues 
such as abortion. 

“I don’t think that be is 
ambassador quality and 
□either do a great many of the 
conservatives and Republi- 
cans in the state of Massachu- 
setts,” Mr. Helms said. 

“ He’s a little loose with his 

but I don’t think he ought to 
be ambassador to Mexico.” 

The president’s selection 
of Mr. Weld, a prominent, 
popular Republican who was 
considered a potential con- 
tender in the presidential race 
last year before he removed 
himself from the ru nning , had 
been intended as a gesture of 
bipartisanship for a sensitive 
diplomatic post 

The U.S. relationship with 
..Mexico — particularly over 
issues like trade, immigration 
and drugs — has been a re- 
peated source of friction be- 
tween the administration and 
the Republicans who control 

When Mr. Weld’s name 
first came up in April, the 
president’s aides expressed 
hope that the governor might 
help win over his fellow Re- 

Given that effort, the op- 
position from Mr. Helms 
caught the White House and 
the State Department by sur- 
prise, and, with Mr. Clinton's 
aides vowing to press ahead. 

appeared to be the opening of 
an intense fight for confirm- 

The opposition could also 
send ripples through politics 
in Massachusetts, since Mr. 
Weld has said he would step 
down to take the diplomatic 
post, clearing the field for the 
gubernatorial race next year. 

While Mr. Clinton has not 
formally submitted- Mr. 
Weld’s name to the Senate for 
confirmation, he plans to go 
ahead with the nomination, 
said Michael McCiutv, the 
White House spokesman. 

“The president is- con- 
vinced he would be a superb 
ambassador to Mexico,” Mr. 
McCuny said in a telephone 

He noted that other Repub- 
lican senators had expressed 
support for Mr. Weld, includ- 
ing Paul Coverdeli of Geor- 
gia, John Ashcroft of Mis- 
souri and Phil "Gitimm of" 

In Boston, Mr. Weld ap- 
peared unfazed by Mr. 
Helm's opposition, pledging 
to meet the senator once his 
nomination became official. 

“It’s part of the process.” 
he said at a news conference. 

“It’s a long process. Every- 
one's got a role to play.” 

If confirmed, Mr. Weld 
would succeed Ambassador 
James Jones, who is stepping 
down. Mr. Weld, in the 
middle of his second term, 
lost a campaign last fall to 
unseat Senator John Kerry, a 

He previously served as as- 
sistant attorney general in 
charge of the criminal divi- 
sion under President Ronald 
Reagan, giving him strong 
law-enforcement credentials, 
which could help ax a time 
when many of the nagging 
problems between Mexico 
and the United States involve 
drugs and crime. 

He also speaks Spanish and 
has had a long friendship with 
the Clintons, having worked 
with Hillary Rodham Clinton 
in the House investigation of 
die Watergate scandal in 

Mr. McCuny said the pres- 
ident had asked Secretary of 
State Madeleine Albright, who 
has developed a fairly close 
relationship with Mr. Helms, 
to meet with the senator “to 
see if we can address whatever 
concerns he might have.” 

Murder of Time Warner CEO’s Son Stuns N.Y. 

By Dan Barry 

A/fw- York Times Service 

NEW YORK — Students of a public high school 
■ English teacher who rarely mentioned that his 

- father was one of the most powerful executives in 

- the business of communications mourned his death 
. after he was found shot in his Manhattan apart- 

The police said the victim, Jo nathan Levin, 31, 
. had been bound at the feet, shot once in the head and 
• sobbed in the chest. 

"News of Mr. Levin's murder sent waves of grief 
^ though die offices of the Time Warner media 
’ conglomerate, where his father, Gerald Levin, is 
. chairman and chief executive, as well as through 
the boisterous hallways of William Howard Taft 
High School in the Bronx, where he was a beloved 

- teacher. 

At Time Warner, the president asked that the 
Levin family be allowed to mourn in private; at Taft 
High School, 80 students and teachers rushed to the 
! school library for consolation. 

Hie police had no suspects, though the fact that 
there was no sign of forced entry led investigators 
to think dial Mr. Levin may have known his at- 
tacker. While some detectives interviewed ac- 

quaintances, others scoured for clues in his one- 
bedroom apartment at 20S Columbus Avenue, an 
unassuming, four-story building that shares side- 
walk space near West 69tb Street with a cafe, an 
Irish bar and a locksmith shop. 

Friends said that this middle-class pocket, in the 
midst of an affluent neighborhood, befitted the 
style of Mr. Levin, who lived amid piles of 
magazines and wicker furniture with Julius, a stray 
dog be had adopted several months ago. Richard 
Veloso, a graphic designer who discovered the 
body, said that be had lived next door to Mr. Levin 
for six years. Yet it was not until after his neigh- 
bor’s death that he learned of the wealth and 
prominence of Mr. Levin’s father. 

One friend, a teacher, Matthew Dwyer, said Mr. 
Levin seemed determined to make his own way. 
‘ ‘He wanted to be his own man.” Mr. Dwyer said. 
‘ ‘Although he was close to his father, and respected 
and loved him a great deal, be didn’t want to be 
known as his father’s son.” 

The discovery of Mr. Levin’s body on Monday 
night came after several days of concern among 
friends who knew him as diligent and respon- 

Jonathan Levin received degrees in English and 
psychology from Trinity College in Hartford, Con- 

necticut, in 1988, then worked for a travel-in- 
surance company. All the while, friends say. he 
wanted to do something more with his life, and that 
was to teach. 

After graduating with a master's degree in 1993 
from New York University’s School of Education, 
friends said, he landed a full-time teaching job at 
Taft High School, a gray box of a building where 
students have to walk through a metal detector to 
get to class. He was an immediate hit. 

In addition to being handsome, students said, he 
had the ability to make them see beyond their 
dreary surroundings to appreciate the art of lit- 
erature. Nick Catraway. a character in the novel 
“The Great Gatsby,” came alive, they said, as did 
Lennie and George from “Of Mice and Men.” He 
arranged a class trip to see the movie version of 
“The Crucible,” took students to baseball games 
and sometimes treated them to dinner at restaurants 
in his neighborhood. 

A few weeks ago, while assigning students to 
write their autobiographies, Mr. Levin revealed 
that his father was die chief executive at Time 
Warner. “I asked him what he was doing here if he 
had money,” said one student. Keisha Montanez. 
“He said it wasn’t his money; it was his father’s 

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Army’s Hunt for Misconduct Picks Up Pace 

4 A* »■ 

By Dana Priest 
andJackie Spinner 

Washington Post Service 

Army’s aggressive effort to rid its 
ranks of serious sexual misconduct 
like rape is now ensnaring officers 
guilty of milder wrongdoing, like 
adultery, that would otherwise have 
gone unnoticed, unpunished and cer- 
tainly unpublicized. 

“People are asking themselves, 
‘How frr is this going to go?' ” said a 
senior official at the Pentagon who. 
like ottos interviewed for tins article, 
asked not to be identified. “There is 
00 answer. The system is overcom- 
pensating here.” 

Having solicited any and all al- 
legations of misconduct in the wake 
of sexual assault and rape charges at 
tie Aberdeen training base in Mary- 
land. army officials now say they do 
not know how to turn off the spigot 

Nearly 1 .300 calls have come into a 
new army hot line alleging sexual 
misdeeds large and small, and 
Pentagon officials said the rank and 
file felt emboldened (o report mis- 
deeds thev would not have divulged 

Last week, the army relieved a one- 
star general Stephen Xenakis, who 
commanded the army’s southeastern 

medical region, for allegedly having 
an “improper relationship” with a 
civilian nurse who was caring for his 
seriously ill wife. 

The navy relieved Rear Admiral 
R. M. Mitchell Jr., head of its 10,000- 
employee supply command, while in- 
vestigating charges he repeatedly 
made advances to a subordinate. 

On Monday, Major General John 
Longbouser, the commander at Ab- 
erdeen who oversaw the courts-mar- 
tial there of sexual offenders, retired 
prematurely at a reduced rank after 
admitting he had had an adulterous 
relationship with a civilian woman 
five years ago, while he and his wife 
were separated. 

These incidents followed the 
highly publicized case of First Lieu- 
tenant Kelly Flinn of the air force, the 
first woman in the nation 10 become a 
B-52 bomber pilot. 

Although she was charged with 
several crimes, including lying and 
disobeying an order, her case drew 
attention primarily because she was 
also charged with adultery. Ms. Flinn, 
who is single, avoided a court-martial 
after agreeing to leave the service 
without the honorable discharge she 
had sought 

Adultery is a crime in the military, 
but it has rarely been prosecuted un- 
less the service member also is ac- 

cused of other, related crimes. In prac- 
tice, the services have allowed those 
who commit adultery to receive ad- 
ministrative punishment, which is 
short of a court-martial or to quietly 
leave the service with some financial 

On Tuesday, General Longbouser, 
a decorated Vietnam veteran with a 
stellar career, issued a painfully per- 
sonal statement acknowledging his 
adultery but noting that he had rebuilt 
his marriage after the affair ’‘Karen 
and I reconciled our differences, and I 
informed her of this relationship. 
Today our marriage is as strong as 
ever, and Karen is my best friend as 
well as a loving and loyal wife." 

While array officials are discussing 
among themselves how far the in- 
quiries will go and how far back in 
time investigators will reach, Defense 
Secretary W illiam Cohen made clear 
Tuesday that he thought the Pentagon 
was taking the right approach. 

“If we start to tolerate a breach of 
standards, or if we start to lower the 
standards,” Mr. Cohen said, “then 
that will have a vast and pervasive 
impact upon the military nation- 

Asked about General Longbouser. 
Mr. Cohen said; “It’s another ex- 
ample of someone who failed to mea- 
sure up to those standards. He has an 

extraordinary career, and be should be 
very proud of that career." 

“But we insist," he added, “upon 
maintaining the standards.” 

The hot line set up at the Aberdeen 
Proving Ground has played a sig- 
nificant role in die surge of sexual 
misconduct cases. 

The army’s Criminal Investigation 
Command is pursuing 339 pending 
charges that arose from information 
gathered on the hot line. 

An additional 328 allegations — 
considered serious, but not criminal 
— have been forwarded to base com- 
manders and offices of the army’s 

About one-third of those cases go 
back to 1995. Another third involve 
allegations that happened from 1984 
to 1995 and an additional 26 percent 
date from 1951 to 1985. 

The hot line was the source of the 
original tip on General Longbouser. 

Army officials said General Long- 
houser’s case would not affect the 
sexual misconduct cases he has been 
involved in. 

His replacement. Major General 
George Friel they said, will review 
the cases as a matter of course, any- 

But defense attorneys are certain to 
try to make an issue out of this de- 

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Hands Off the Barbecue! 

Sure, Americans want clean air. 
-But woe unto the bureaucrat who 
even tf»nirg of messing with their bar- 

A proposal under final review at the 

Environmental Protection Agency 
and the White House, which would 
regulate microscopic soot for the first 
time, would not have attracted much 
attention if it applied only to factories, 
-industrial plants and coal-bunting 
power plants. In fact, it does. But 
‘somehow the message got skewered. 

- Word has been going around that 
the EPA would tan backyard bar- 
becaes. The reaction has been hot and 
smoky. Not only have newspaper 
com me ntaries blasted the idea, the 
Michigan House approved a resolu- 
: tion ordering federal bureaucrats not 
to restrict the use of barbecue grills. 

: The EPA and state environmental 
. officials are doing their best to re- 
: assure tire tarbecners of the land. 
! "There are a lot of things we would 
faok at before we went go that ex- 
Michigan official said. 

Eavinawtiemah'sts say the barbecue 
toft h a scare tactic ©divert attention 

from industrial polluters, which release 
23 million tons of volatile organic 
compounds a year. All the barbecues in 

the nation release just 14,500 tons. 

Short Takes 

During the Depression, Harold 
Englehardt won from farm to farm to 
raise money to start a bank in Lowell 
Michigan. As the tank’s president, he 
made deals on a handshake, dressed 
up as Santa Claus at Chris tmas and 
passed out Halloween candy in a top 
haL Everyone suspected he was 
wealthy and knew he was generous, 
but not this wealthy or tins generous: 
At his deatii in April at age 96, he left 
$12 million, the bulk of his estate, to 
the western Michigan town of 4,000. 

- Fast-Thinking Victim Dept: 
When a man drove up next to Myko 
Kona not long ago in Redondo Beach, 
California, and exposed himself, she 
kept her cool She snapped his pic- 
ture. He tried to grab her, but she ran 
behind his van to photograph the li- 
cense pkte. There was mine. Retried 
to back over her. She ran to the front, 
and snapped a shoe of that license 
plate before diving into boshes and 
escaping. The police developed the 
film and within, hours arrested Jimmy 
Jewdl 33, on charges of assault with 
a deadly weapon (the van) and in- 
decent exposure. He pleaded guilty. 

International HemldTrihune 

Feminist Assails Clinton 
For Threats in Jones Case 

By Neil A. Lewis 

New York Tunes Service 

tional Organization for Women 
has criticized President Bill Clin- 
ton and his lawyers for threatening 
to make an issue of Paula Jones’s 
sexual history if she proceeds with 
ho- lawsuit against him for sexual 

Patricia Ireland, the president of 
NOW, said in an interview that 
Ms. Jones’s personal history was' 
irrelevant in determining whether 
her allegations against Mr. Clinton 
were true. She said it would be 
offensive for Mr. Clinton and his 
lawyer, Robert Bennett, to by to 
prevent Ms. Jones from going for- 
ward with her lawsuit by threat- 
ening to damage her reputation. 

More important, Ms. Ireland said, 
was the danger that Mr. Clinton 
might alienate women who have 
seen him as a supporter of feminist 
issues. “Although he cannot run 
again,” she said, “he is, after all, the 
first president to have been elected 
with such crucial support from 
women, and his natural constituency 
is going to be turned off by these 
irin/te of attacks and warnings.” 

Ms. Ireland’s comments fol- 
lowed an exchange Sunday be- 
tween Mr. Bennen and Ms. Jones’s 
lawyers cm potential tactics in a 
trial sbould one be held. The tac- 
tics included the possibility of ex- 
poring more details about the sexu- 
al lives of each other's clients. 

Ms. Jones has charged that Mr. 
Clinton violated her civil rights 
while he was governor of Arkansas 
by sexually harass in g her and dam- 
aging her reputation^. She has 
c laimed that in f99l she was taken 
by a state trooper to a hotel room 
where Mr. Clinton made a crude 
sexual advance. 

Mr. Clinton has denied the 
ch ^ge s, and Mr. Bennett said that 

ttapresidentwould not apologize to 

Ms. Jones to settle the suit because 
he was adamant that the episode she 

had described did not happen. 

Ms. Jones’s lawyers have said 
that to prove their case they would 
probably seek testimony from other 
women who may have been sexu- 
ally propositioned by Mr. Clinton. 

In response, Mr. Bennen said 
Sunday that such a tactic was a 
two-edged sword and that Ms. 
Jones could put her reputation at 
risk if she pursued it 

Clinton 9 $ New Tack White House Access 
On Finance Reform 

WASHINGTON — After months of in- 
action on Capitol Hill. President Bill Clin- 
ton plans to try another route to campaign- 
finance reform by petitioning the Federal 
Election Commission to outlaw the lim- 
itless contributions known us “soft 
money” that have powered both major 
political parties in recent years. 

White House aides said the petition 
would be filed in the next few days as the 
president begins to focus more attention on 
an issue that had been largely ignored while 
the White House and Congress hammered 
out a plan to balance- the budget. 

While uot as comprehensive as the White 
House-supported legislation languishing in 
Congress, a regulatory ban on soft money 
would attack what reform advocates con- 
sider one of the prime areas for abuse in the 
modern-day financing system. 

Under the current rules, donors can get 
around limits on gifts to individual can- 
didates by sending as much money as they 
want to DeiTKxrrafic or Republican party 
committees. Such money is supposed to be 
used for generic “party-building” purposes. 
But that definition has been stretched to 
include a broad spectrum of activities ben- 
efiting specific candidates, including a multi- 
million -dollar television advertising cam- 
paign, ostensibly promoting the Democratic 
agenda, that was orchestrated by the White 
House to help re-elect Mr. Clinton last year. 

During the last election cycle, the two 
major parties raised a record $262 million in 
soft money. Advocacy groups charged that 
the parties broke the law in the way they 
spent iL (WP) 

WASHINGTON — A high-ranking De- 
partment of Energy official interceded with 
a National Security Council official on be- 
half of a Democratic donor, Roger Tamraz, 
after Mr. Tamraz discussed his proposal for 
a foreign oil pipeline with President Bill 
ClintoiC administration officials said. 

Despite warnings about allowing Mr. 
Tamraz into the White House. Mr. Clinton 
and Thomas McLarty, who was chief of 
staff at the time, met with him at fund- 
raising events in the executive mansion in 
the spring of 1996. 

Mr. McLarty subsequently asked the En- 
ergy Department if the administration could 
be more supportive of Mr. Tamraz *s pro- 
posed pipeline, which would carry oil from 
the Caspian Sea to Turkey, one admin- 
istration official said. 

Mr. Tamraz. an oil financier, had several 
meetings at the White House after pres- 
idential aides recommended that he be 
denied access, the officials said. 

The recommendations were made be- 
cause of suspicions that he was misrep- 
resenting his relationship with White House 
officials to potential business partners. 


Quote/ Unquote 

State Senator Jim McGreevey of New 
Jersey, who voted for the 1990 tax increase 
that doomed the state's last Democratic 
governor, after winning the parry’s primary 
to challenge Governor Christie Whitman: 
“Fiorello LaGuardia used to joke there 
isn’t a Republican or Democratic way to fill 
a pothole. I know how to get things 
done.” (APi 



Away From Politics 

• Police officers in Miami Beach, Flor- 

ida, can now stop by a McDonald’s res- 
taurant to fill out reports and make phone 
calls without traveling back to their station. 
The restaurant, owned by a former po- 
liceman, has reserved a table and phone for 
the officers. (AP) 

• An FBI assault team vehicle with guns, 
ammunition and other gear, was stolen from 
a parking lot in Memphis, Tennessee, and 
was discovered abandoned and burned with 
the weapons and gear missing. (NYT) 

• The Boy Scouts of America does not 
have to admit a 13-year-old girl who wants 
to join her twin brother’s troop, a California 
stale appeals court ruled. The court said the 

organization was not a business and there- 
fore not subject to the same laws on dis- 
crimination. (AP) 

• A serial rapist convicted of murdering a 
Houston woman in 1986 was executed by 
injection at the Huntsville State Prison in 
Texas. The rapist, Kenneth Harris, 34, was 
sentenced to die for the murder of Lisa 
Stones tree!, a legal secretary. (Reuters) 

• Nearly 4 out of every 10 doctors dis- 

ciplined by medical boards for sexual mis- 
conduct continue to practice medicine, a 
consumer advocacy group said. A survey 
by Public Citizen's Health Research Group 
examined 542 doctors who were disci^ 
lined for sex-related offenses since 1981. 
Of that group. 39.9 percent were licensed to 
practice in the region in which they were 
disciplined. (AP) 


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China’s Prison Labor System Sounds a Lot Like Florida s 

By Paul Blustem 

W<uhtn$im Post Service 

WASHINGTON — Horror stories 
are surfacing anew about the Chinese 
prison labor system and the sale of its 
products in the United States, fint coo* 
sider what is happening to the 64.000 
convicts in the Florida prison system: 

Prisoners are required to work — or 
face punishment- Most inmates, even 
ones digging ditches on chain gangs, are 
paid nothing. Moreover, some of the 
products they make, like boots and li- 
cense plates, are exported to foreign 

Therein lies a question: Because in- 
mates in many U.S. prisons are obliged 
to work, do Americans have the right to 
condemn China's prison labor prac- 

The question arises because China's 
“reform through labor" penal system, 
known in Chinese as laosai, is becom- 
ing a hot issue in Congress and the press 
amid the mounting debale over whether 
Beijing should be allowed to retain its 

trading privileges. Senate and House 
committees held hearings May 21 and 
22 on allegations that goods made in 
Chinese prisons are being imported into 
the United States in violation of U.S. 
law and a U.S. -China agreement. 
Among those offering testimony about 


how easy it is to buy goods made by 
convicts was Harry Wu, a former inmate 
laborer who has gained worldwide fame 
for returning to C hina to document its 
‘•prison economy." 

This is generating potent ammunition 
for critics of U.S. trade with China, who 
contend that Beijing is profiting from 
the toil of people railroaded into work- 
ing cruelly long hours under appalling 
conditions. Television advertisements 
being readied by the Family Research 
Council, a group seeking to overturn 
China's mosi-favared-oatioa trade 
status, accuse Beijing of employing 
“slave labor." 

But some academic experts call this 

argument a classic example of hyping 
an issue to advance a political agenda. 

"Harry Wu and others have tried to 
stir up. a great controversy about how 

moo our market,” said James Feiner- 
man, a professor of Asian Legal Studies 
at Georgetown University. 

"But in fact, it's only a tiny fraction 
of all Chinese goods. And it seems to me 
to be the height of hypocrisy for us to get 
on our High horse about China making 
its prisoners work, given the fact that we 
do the same thing with our prisoners." 

The importation of goods made in 
Chinese prisons, while against U.S. law. 
should be a “non-issue because the 
amounts are so small,’ ’ said James Sey- 
mour, a senior research scholar at 
Columbia University whose book on 
Chinese prisons is scheduled to be pub- 
lished shortly. 

Although the precise amount is im- 
possible to determine, Mr. Seymour’s 
book cites Chinese economic data in- 
dicating that the output of prisons con- 
stitutes less than one -fifth of one percent 


of total Chinese production. The U.S. 
federal prison system, and many state 
prison systems, requires all able-bodied 
inmates to work. Those who refuse typ- 
ically are deprived of privileges or sent 
to higher-security institutions. 

Pay is far below minimum wage — 
12 cents to $1.15 an hour for federal 
inmates, and less than that in many state 
systems. So their products usually are 
barred from sale except to government 
agencies. But, while the law prohibits 
importing prison-made goods and re- 
stricts their sale across state lines, there 
is no law barring their export. At least 
three states have exported at least small 
amounts of goods. 

In China, die case of Chen Pokong. a 
33-year-old visiting economics scholar 
at Columbia University who spent five 
years as an inmate, illustrates what 
many experts rind most troubling about 
the penal system — the extensively doc- 
umented evidence that prisoners often 
are treated brutally. 

Mr. Chen, who said he was sentenced 
in 1989 for helping to lead a student 

democracy movement in the south can 
province of Guangdong, said he spent 
two years in one facility where prisoners 
were forced to cany heavy stones for 
eight hours to load on ships. 

••Then, until midnight, we made ar- 
tificial flowers; sometimes we had to 
work through the night," he saw- 
“If you collapsed before you finished 
the qaoca, you were heavily beaten.” • 
Mr. Seymour said some of the prisons 
he researched for his book were * ‘totally 
inhumane," while in others, “conditions 
were much better.” Prisoners generally 
received some paltry wage, he said. 

But repugnant as conditions in 
Chinese prisons might seem to many, 
Mr. Feinerxnan said, they are based on a 
decision by the Chinese authorities “to 
make offenders pay a harsh penalty, on 
the theory that it scares people so they 
won't coaie back into the prison sys- 
tem." . . „ . 

“You cft n argue that it works, he 
said. “They have very low rates of 
recidivism. Who are we to argue with 
their choices?" 

Saudi Pilot Lands 
In Trouble in India 

NEW DELHI — A Saudi pilot who 
landed his jumbo jet with 344 pas- 
sengers at an Indian military airbase 
faces criminal charges, officials said 

A police official, C. K. Gandhi raj an, 
said the pilot has been charged with 
criminal trespass, causing damage to 
the airstrip and irresponsible flying. 

The pilot landed die Boeing 747 at 
Tamharam, a tiny military airstrip near 
Madras, on Monday after mistaking it 
for the main Madras airport. The plane 
and the airfield were damaged, but the 
passengers and crew were unhurt. 

Indian aviation authorities said it 
would be difficult to remove the plane 
from the airstrip. They have contacted 
Boeing Co. in the United States to 
suggest ways to get the plane air- 
borne. (AFP) 

Golkar Wins Re-Tote 
On Indonesia Island 

SAMPANG. Indonesia — Indone- 
sia's ruling Golkar party won a re-vote 
on Madura island Wednesday, days 
after Muslims burned ballot boxes 
claiming fraud in the general elections 
last week. 

The Sampang Regency head, Fad- 
hilah Budiono. said Golkar won 58 
percent of ballots cast at the 65 polling 
stations where the vote was held on the 

isle off East Java. The Muslim-backed 
United Development Party, whose sup- 
porters rioted after the May 29 poll on 
reports of a Golkar sweep, took 41.1 
percent of the re- vote, while the other 
legal party, the Indonesian Democratic 
Party, won 0.9 percent f Reuters} 

Downpour Leaves 
Hong Kong in Chaos 

HONG KONG — Heavy rain 
plunged parts of mainland Hong Kong 
into chaos Wednesday, killing a child 
in a mudslide. Floods disrupted traffic, 
and schools and courts had to dose. 

A mudslide in Kwai Chung in the 
rural New Territories area ploughed 
into a wooden Hut where a family of six 
was living. Firemen rescued five, but a 
4-year-old boy died. Roads were 
blocked and cars damaged as mud- 
slides brought trees skidding down. 


For the Record 

Three Indian soldiers were killed 
and three wounded Wednesday in a 
landmine explosion by guerrillas in 
Kashmir, the police said. (Reuters) 

An Indian judge dropped charges 
Wednesday against former Prime Min- 
ister P. V. Narasimha Rao in a forgery 
trial, one of three criminal cases which 
had forced him to quit last year as 
Congress (I) Party leader, his lawyer 
said. ( Reuters ) 

ilr fimrtniwil/Hrtil.'lv 

An Indonesian official displaying an empty ballot box Wednesday before the voting on Madura Island. 

Hong Kong 
Remembers • 
The Victims 
Of Tiananmen 

By Edward A. Gargan 

jtfcK Yuti Tunes Service 

HONG KONG — A sea. of 

: t 1 

sequined by pinpoints of candlelight 
gathered Wednesday evening in defi- 
ance of both China and its appointed 
ruler for the territory to commemorate 
the massacre of hundreds of unarmed 
protesters in and around Tiananmen 
Square on June 4, 1989. 

Bathed in waves of song and silence, 
more than 55,000 people — teachers 
and preachers, engineers, students, so- 
cial workers, taxi dri vers and bankers — 
assembled in Victoria Park in what maff 
be Hong Kong's last memorial to the 
victims of the Tiananmen massacre. 

On July 1, (his 156-year-old British 
colony of 6.3 million people returns to 
Chinese sovereignty and to rule by 
Beijing's appointee, Tung Chee-hwa, a 
shipping magnate who has little pa- 
tience for public protest or dissenL 

On Monday, Mr. Tung, who has an- 
nounced plans to curtail Hong Kong's 
civil liberties, including new restric- 
tions on the right to stage public 
protests, urged Hong Kongers to "put 
aside the baggage of June 4. ” \ [ ! : 

"It is important to put the baggage 
down to move on with building the ?• 
country," he told local radio and tele- Ujj 1 
visions Monday. “In the last 8 years, ‘ " 

China has had many reforms, and it has 
achieved a lot it is obvious that social 
stability helps China’s development." 

But Wednesday evening, in die vast 
crowds seated in a seemingly endless 
furrows on soccer fields of Victoria Park. 

Mr. Tung's admonitions were ignored' 

“I am here to remember those who 
were killed,’' said Chan Mei, a high 
school teacher. Cradling her two-year- 
old daughter in her lap, Ms. Chan said 
she also came because it may be the final 
memorial to those killed. 

"TTu's may be the last time,” she 
explained. “For me, it's more of an 
emotional thing rather than political. I 
don’t know if everyone sees it this way, 
but there are things we want to achieve, 
freedom and democracy. But after July 
1, we don’t know." 

■ Tight Security in Beijing 

Tourists posed for snapshots as plain- . 
clothes policemen kept close watch bo 4 
Tiananmen Square on Wednesday, The 
Associated Press reported from Beijing. 

Wary that any trouble could foul Hong 
Kong’s July 1 transition to Beijing's 
rule, Chinese authorities maintained 
tighL security in the capital 



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India Denies Deployment of Missiles 

Ceaftkd t* Our S*4T Fmni Dupmtba 

NEW DELHI — India on Wednesday 
denied a U.S. report that it had deployed 
medium-range ballistic missiles along its bor- 
der with Pakistan. 

“Prithvi missiles have not been deployed 
along the international border," a Defense 
Ministry spokesman said. 

The ministry said Tuesday that it had no 
information on the Washington Post report. 

The government of Pakistan warned that the 
deployment of medium-range ballistic missiles 
near its border could trigger a “dangerous” 

arms race and prompt Pakistan “to take nqg- 
essary measures to safeguard its security." =? 

The Washington Post report said that UJS. 
intelligence officials believed the Indian Army - 
had moved a handful of Prithvi missiles froma 
manufacturing plant in southeast India to a site - 
near the city of Jullondur in northwest India, 

The State Department declined to comment *| 
directly on the report Bui the department 
spokesman, Nicholas Bums, said, “We are 
working with the governments of India and 
Pakistan to prevent a deployment of ballistic 
missiles by either country. ’ ’ (Reuters, WP) 



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Britain’s Job Plan for EU 

Brown to Urge Flexibility in Labor Market 


LONDON — The chancellor of the Ex- 
chequer, Gordon Brown, outlined what he 
called an employment plan for Europe on 
Wednesday and promised to make it a central 
theme of Britain's presidency of the European 
Union next year. 

Mr. Brown said he would push the three- 
point job-creation plan at next week’s regular 
meeting of EU finance ministers. 

.! On the issue of the planned single European 
currency, he told reporters that the govern- 
ment's policies were unchanged. Britain will 
maintain its “wait-and-see” approach, ac- 
knowledging that there are big obstacles to 
joining the first round of countries in the 
monetary union, he said. 

Fresh uncertainty is clouding the currency 
plan after the Socialist victory in the French 
ejections Sunday and the German central 
bank’s victory this week in blocking Bonn's 
proposal to revalue gold reserves to help it 
qualify for the single currency. 

Mr. Brown's employment plan aimg to 
create jobs by increasing Labor-market flex- 
ibility across Europe. It also proposes a new 
.task force to help small companies create jobs 
and- to push for completion of the single 
jEuropean market. 

He said he would raise these proposals with 
other EU finance ministers at a meeting in 
^Luxembourg on Monday. “We intend to 



make this a key theme of our presidency of the 
G-8 and of ihe European Union,” he said. 

Britain takes up the presidency of the G-8 
— the Group of Seven leading industr ializ ed 
countries plus Russia — and of the EU in 
January. Mr. Brown said he would be looking 
for concrete results by the end of Britain’s EU 
presidency a year later. The EU and G-S 
presidencies rotate among member nations. 

Mr. Brown proposed a more involved 
European role for Britain than under the pre- 
vious Conservative government, saying his 
plan was the first EU initiative by a British 
administration in 10 years, though he added 
that this did not signal a willingness to give up 
Britain’s veto over key issues. 

“No longer should the British government 
sit on the sidelines of Europe,” he said. 

For too long, he said, the EU debate has 
been directed only at die single currency, 
scheduled to scan in January 1999, and he 
suggested that now was the time to widen the 
discussion to include jobs. 

Improving education and raising workers’ 
skills, as well as reducing the burdens on 
business, are the best ways to promote growth 
and reduce unemployment, he said. 

“This is the new economic agenda.” Mr. 
Brown said. “It enables us to benefit from 
flexible labor markets while ensuring that 
everyone can share in the rewards of a more 
dynamic economy." 

l#£ l 'U • *- ■ 

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Pope Urges Poland 
To Ban Abortion 

Pope John Paul n praying in Poznan during his tour of Poland, his homeland. 

The AnociuteU Press 
KALIS Z, Poland — Step- 
ping again into Polish pol- 
itics. Pope John Paul D said 
Wednesday that post-Com- 
munisr Poland should outlaw 
abortion not just on religious 
grounds, but as a matter of 
human rights. 

“The right to life is not a 
question ondeology, not only 
a religious right — it is a 
human right,” the Pope told a 
receptive crowd of 150,000 in 
the main square of Kalisz, a 
town in central Poland fa- 
mous for a 17th century pic- 
ture of the Holy Family in the 
Sl Joseph sanctuary. 

Referring to his condem- 
nation of abortion last Oc- 
tober — “A nation which 
trills its own children is a na- 
tion without a future” — the 
Pope added: “Believe me, it 
was not easy to say that, es- 
pecially thinking about my 
own nation. I desire a future 
for it, a great future.” 

Having played a crucial 
role in toppling Poland's 
Communist regime in 1989, 

the Pope has not shied away 
from criticizing whai he sees 
as the flaws of the new cap- 
italist system during his 11- 
day tour that started Sat- 

After four decades of abor- 
tion on demand under com- 
munism. Poland's Solidarity- 
led government passed a 
near-total ban in 1993, with 
exceptions only in cases of 
rape or incest or if the fetus 
was irreparably damaged or 
the mother's life en- 

The law was liberalized 
last year, after the former 
Communists gained power, to 
allow abortions until the 12th 
week of pregnancy for wom- 
en deemed to have financial 
or emotional problems. 

But last week, Poland's 
highest court said financial or 
emotional difficulty was not a 
strong enough reason to deny 
the right to life. Parliament 
now has six months to either 
overturn the ruling with a 
two-thirds’ vote, or amend it 
to comply with ruling. 


Austrian Chief Denies 
Aiding 2 Iranians 

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, VIENNA President 
rjJ Thomas KJestil, responding 
f- '"for the first time to allegations 
"he pulled strings to allow sus- 
■ # pfected Iranian assassins to 
^fjee Austria, insisted Wed- 
. .' nesday that he had nothing to 
• : tfde. 

... “ “lam in favor of putting all 
: ihe documents on the table,” 
Mr. Kies ill told the Austrian 
. foews agency APA as he flew 
[Gack from an official visit to 
‘‘Spain. “I have nothing to 
// ‘conceal.” 

■ ' Mr. KJestil was a senior 
'official in the Foreign Min- 
istry in 1989 when the Iranian 
Kurdish leader Abdorrahman 
. . Qasemlu and two other ac- 
jivists were killed in a Vienna 
;apartmeni, apparently by Ira- 
"nian hitmen. 

“I did not try to influence 
.■ ;the decisions of the Interior 
7 fahd Justice ministries," Mr. 
“ "Klestil said. • • . 

'"All those involved know 
— -that -and the papers prove 

- He rejected claims that he 
c Gad excited pressure on the 

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other two ministries to drop 
the case. Former President 
Abol-Hassan Banisadr of 
Iran, along with a former 
Austrian diplomat, alleged i 
that Austria, fearing relalia- ! 
non from Iran, allowed two of 
the three Iranian suspects to 

Warrants for their arrest 
were only issued when they 
were outside the country. 

Opposition parties have 
called for a parliamentary in- 
quiry into the matter. On May 
22. they began a 20-day boy- 
cott of parliamentary" busi- 
ness to protest the govern- 
ment's use of its majority to 
block their request. 

Chancellor Viktor KJima's 
Social Democrats and its ju- 
nior coalition partner, the 
People's Party, have argued 
that a report prepared by the 
Interior, Foreign and Justice 
ministries exonerates politi- 
cians of any wrongdoing. 

Mr. Klestil, a member of 
the conservative People’s 
Party, has yet to say whether 
he will run for re-election 
next year. 

•= ■ Holbrooke Is Called the Choice 
' ■ For U.S. Ambassador to Cyprus 

; ■ WASHINGTON — Hoping to ease tensions in the 
* Aegean, President Bill Clinton has chosen Richard Hoi- 
, brooke, a high-profile diplomat, to be his envoy to 
. • Cyprus, administration officials said Wednesday. 

Mr. Holbrooke helped negotiate an end to the civil war in 
Yugoslavia and was on Mr. Clinton's short list for sec- 
retary of state and United Nations ambassador in 1 996. 

' His selection signals the administration’s intention to 
make die complex, 2I-year-old division of Cyprus a top 
_ ■ agenda item for Secretary of State Madeleine Albright, 
said two administration officials. 

Mr. Holbrooke, 55, the diplomat credited with ne- 
gotiating the Dayton peace accords for Bosnia, left the 
administration last year amid unusual fanfare to work as 
an investment banker in New York. (AP) 

Impatience on Eurofighter 

BONN — Leaders of the German aerospace industry 
threatened Wednesday to pull out of the troubled 
Enrofighter defense project unless the Bonn government 
gives a firm go-ahead by July. 

"Our patience is at an end," said Hans Eberhard Birke, 
head of the Association of German Aerospace Industries. 
“If the indecision continues, the industrialists will pull 
out of the program in July. 

"The industry cannot "continue forever pumping mil- 
lions of its own funds into the preparation of a series 
whhont getting the slightest reassurance that the program 
will go ahead.” he added at a news conference. (AFPi 

Italian Presidency Reform Plan 

ROME — Italy moved a step closer Wednesday to 
electing its president directly, a reform that could 
strengthen the executive and make the country more 

A 70-member parliamentary committee working on 
constitutional reforms voted to make a “semipresid- 
ential” system one of its recommendations. The elected 
president would govern along with a prime minister from 
tbepariiamentaiy majority. 

Currently, Parliament chooses the president. The post 
is largely ceremonial, though the president can dissolve 
Parliament and names the prime minister — usually the 
head of the do minant party or coalition. 

The committee rejected a competing proposal for the 
L direct election of the prime minister, which many of the 
leftist members had favored. lAP) 

- D’ Amato Weans on Bank Guard 

WASHINGTON — Senator Alfonse D’ Amato, Re- 
i publican of New York, said Tuesday that Swiss law 
. enforcers intended to move ahead with criminal charges 
againaChristophe Meili, the bank guard who saved some 
w Holocaust-era documents from Union Bank of Switzer- 
; land’s shredding machine. 

"They’re gomg to charge him with criminal conduct, 
JRJlthe bank which shredded the records.” Mr. D’Amato 
said in a Senate speech. “And they want Mr. Meili to 
. come bade to Switzerland for another interview,” 

Mr, Meili, 29, and his family fled to the United States 
. in April after he received (tenth threats and warnings that 
his wife and two young children could be harmed because 
of his actions. 1APi 

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The new Ericsson GH688 offers full data and fax compatibility, 
so now you can do your business wherever you like. 100 hours of 
stand-by time with the High Performance Battery, SMS and alarm clock 
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The new Ericsson GH688. 
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Philippe Seguin, leading contender to take over the Gaullist RPR, arriving Wednesday at a meeting in Paris. 

FRANCE: Jospin Fills His Cabinet With a New Generation 

Continued from Page 1 

the European Union's Maastricht treaty 
and get France on track for a single 
European currency along lines accept- 
able to Bonn. 

The defense ministry went to Alain 
Richard, a moderate Socialist, who has 
less experience in handling strategic is- 
sues than does Mr. Vedrine or Mr. 

Both of them have criticized Mr. Chir- 
ac's plans to reintegrate French forces 
with NATO and voiced suspicion of 
plans, supported by the United States, 
for expanding NATO eastward. 

Offering the most tangible indication 
yet of how Mr. Jospin intends to run 
things, the government's composition 
pointed to a strategy of seeking support 
from every* left-leaning constituency. 
Ministerial slots went "to eveiy party, 
including the Greens, that joined the 
Socialist-led electoral alliance. 

In addition to Mr. Delors, other ex- 
clusions included the Socialist old guard 
prominently associated with Mr. Mit- 
terrand. notably Jack Lang, a former 
culture minister, and Michel Rocard. a 
former prime minister. 

Like Mr. Jospin, most of the new team 
were involved in government during the 

Socialists' years in power in the 1980s, 
but none was tarred by the scandals and 
disillusion that engulfed his last years. 

A sign of Mr. Jospin's determination 
to impose his own stamp was the un- 
usually small number of ministers — 30 
instead of 40 or more that- have been 

Key posts went to allies of the prime 
minister, who ignored political tradition 
by going outside Parliament to bring in 
Mr. Vedrine and the new minister for 
education, research and technology. 
Claude Allegre. a long-time Jospin ad- 

The most controversial aspect of Mr. 
Jospin's choices was his decision to in- 
clude Communists, whose seats are 
needed for his majority in Parliament 

Their inclusion could alarm investors 
because of the party's hostility to the 
European Union and demands for im- 
mediate increases in the minim um wage. 

Taking them in appeared to be a cal- 
culated risk, but the Communists’ sup- 
port could be instrumental in restraining 
the main trade unions, some of which 
have already starting pressing for action 
on the pay raises. 

Among the non-Socialist ministers, 
the most important job went to Jean- 
Pierre Chevenement, who was made in- 

terior minister. He formed the anti- 
Maastricht Citizens’ Movement after 
resigning as defense minister during the 
Gulf War and then breaking with the 

In the core group of Socialist min- 
isters. a common denominator was their 
commitment to easing inequalities in 
French society, mainly through more 

and better-managed government 
policies. Most could be characterized as 
pragmatic, but almost none have ever 
managed a business and only a few have 
had significant experience administer- 
ing cities or regions. 

■ The French Cabinet 

This to o IW of maJn cabinet ministers announced by 
Prime Minister Jospin. Non-SodaBsIs are designated: 
Foreign: Hubert Vedrine 
Defense: Alain Richard 

Interior: Jeart-Plene Chevenement Citizens Move- 

Economics: Dominique Strauu-Kahn 
Labor Marline Aubry 
Justice: Elisabeth Guigou 
Education: Ooude Allegre 
Transport: Json-Qaude Gayssat Communist 
Culture and Communicottan: Catherine Traufmann 
Agriculture and Fishing: Louis Le Pensec 
Environment and Territorial Management: Domi- 
nique Voynet Greens 

Parliamentary Relations: Daniel Vallkmt 
Civil Service, State Reform ond Decentralization: 

Youth ond Sports, Morte-George Buffet, Communist 


McVeigh Jurors 
Hear Prosecutor 

He Says Facts , Not Sympathy, 
Should Decide Sentencing 

The As soChtml Press 

DENVER — Timothy Mc- 
Veigh set out to kill govern- 
ment agents and “he had to 
kill all of these innocent 
people to accomplish the 
goal," a prosecutor told jur- 
ors Wednesday as he sought 
to convince diem that Mr. 
McVeigh shou’d pay with his 
life for the Oklahoma City 

"Death was random on 
April 19th,” said Patrick Ry- 
an, a U.S. attorney, noting that 
Mr. McVeigh set his bomb for 
9:02 A.M. to make sure the 
federal building was Tilled 
with people. "He wanted to 
make sure blood flowed in the 
streets of America.' * 

Mr. Ryan urged jurors in 
the sentencing phase to base 
their decision on facts rather 
than sympathy. The govern- 
ment is expected to cadi about 
45 witnesses over three days 
to describe how the bombing 
devastated their lives, phys- 
ically and emotionally. 

He said that some of the 
testimony “will be difficult to 
present” and “some informa- 
tion will be painful to hear.” 

“It would be easy for you 
as a jury to think of this as one 
mass murder — don't.” Mr. 
Ryan said. “There are 168 
people, all unique, all indi- 
vidual. All had families, all 
had friends and they're dif- 

In the penalty phase, the 
same jurors who convicted 
the 29-year-old Gulf War vet- 
eran of murder and conspir- 
acy in the 1995 blast will de- 
cide whether he should die or 
receive a life sentence. 

Hie vote must be unani- 
mous and cannot be overruled 
by the judge. If the jury can- 
not agree, the judge can im- 
pose a sentence of up to life in 
prison without parole. 

“Your role in this proceed- 
ing is to be the conscience of 
the community.” Judge 
Richard Matsch told the jur- 
ors earlier. “Your decision 
must be a reasoned one. free 

from the influence of passion, 
prejudice or any other arbi- 
trary factor.” 

Determined to keep the 
hearing from becoming 
“some kind of lynching,” 
Judge Matsch has diminished 
the government's use of 
graphic, wrenching testimony 
to appeal to the jury's emo- 

He barred prosecutors 
from presenting victims' 
wedding photos, a poem by a 
victim's father and testimony 
on funeral arrangements. 

In addition, he prohibited 
testimony from any bombing 
survivors and victims' rela- 
tives who were prejudiced by 
testimony from the trial. He 
allowed those witnesses to be 
questioned extensive]]/ in ad- 
vance to determine if they 
may testify. 

He also refused to let the 
defense present evidence on 
the handling of the fatal gov- 
ernment raids at waco, 
Texas, and Ruby Ridge, 
Idaho, which the defense 
could claim drove Mr. Mc- 
Veigh to commit the worst act 
of terrorism on U.S. soil. 

“We have to guard this 
hearing to ensure that the ul- 
timate result and the jury's 
decision are truly a moral re- 
sponse to appropriate infor- 
mation rather than an emo- 
tional response.' * Judge 
Matsch said. 

Despite hN rulings, he will 
allow’ plenty of potentially 
emotional testimony, includ- 
ing that of a 10- year-old boy 
whose mother died and of a 
rescuer who held a hand bur- 
ied in the rubble, only to feel 
the pulse stop. 

The judge will also allow 
photos of maimed survivors 
and of victims being wheeled 
into hospitals and testimony 
from the coroner about the 
various causes of death, in- 
cluding that of a man who 
died slowly with gravel in his 

"We can't sanitize this 
scene.” Judge Matsch said. 



3 French Centrists 
Said to Face Probe j 
Over Party Funds 


PARIS — A judge has 
placed three former govern- 
ment ministers under inves- 
tigation in a probe into illegal 
party funding, French justice 
sources said Wednesday. 

They said Jacques Barrot, 

labor minister in die outgoing 

government, former Justice 
Minister Pierre Mefcaignerie 
and former Transportation 
Minister Bernard Besson 
were put under investigation 
by Judge Jean-Piene Zanoto 
on Monday. 

The three, all centrists, 
were re-elected on Sunday 
after a campaign in which 
sleaze was a major issue, with 
the left accusing President 
Jacques Chirac of calling the 
election almost 10 months 
early to preempt mounting 
scandals affecting his Rally 
for the Republic party. 

The three former members 
of the Democratic Force 
party, as well as a former 
treasurer of the group, which 
is part of the wider Union for 
French Democracy coalition, 
were suspected of illicit party 
finan cing, the sources said. 

The four are suspected of 
creating a slush fund in 
Switzerland to channel illicit 
funds into the party. 

The sources . said Jean 
Ardnris, finance minister in 
the outgoing government, 
was initiall y mentioned in the 
case but that die judge was 
considering clearing him be- 
cause his role in die party had 
been too minor. “I was not 
one of the leaders,” Mr. 
Arthuis said in April. “I was 
not treasurer of the party. This 
does not concern me.” 

The center-right coalition, 
made up of the RPR and the 
UDF, was defeated in 
Sunday’s parliamentary elec- 
tion. which brought a leftist 
bloc led by the Socialists to 
power. On Tuesday, a pros- 
ecutor opened an investiga- 
tion into suspected graft over 
public works contracts by the 
Paris regional council, led by 
a Chirac ally. 

The Paris pnblic prosecu- 
tor’s office launched the in- 

vestigation into the lie d£i 1 
France Council, led by- 4 
Michel Giraud. for “favor -- * 
itism, fraud, forgery, receiv-^ . 
mg die proceeds of fraud and 
anti-competitive practices in" . 
public tenders.” 

Mr. Giraud is a senior ' 1 * 
member of Mr. Chirac’s * •• 
RPR. * • 

A regional auditors' report - 
senf to-Mr. Giraud on April 8 
condemned “practices aimed-' ■ 
at restraining competition.''-* 
especially in awards of build-' - 
ing high schools in the lie de " . ; 
France region, which includes - - 
Paris and surroundings. BuT- 
the Paris prosecutor had put 
off an immediate decision on’ - ■ 
whether to open a probe. •- 

Stuart Troup, 63,', 
Ex-IHT Editor 
And Writer, Dies " . 

fnsernutitmul Herald Tribune 

PARIS — Stuan Troup^. 
63, a versatile writer, critic 
and editor who worked for 
newspapers in the United ,, 
States and Europe, died Wedv j 
nesday in Valhalla, New* 

The cause of death was. 
complications after a ktdnev 
transplant in 1 992. 

Mr. Troup was an editor at' 
the International Herald 
Tribune from 1973 to 1979.^ " 
He also worked for the Rome* 
Daily American, The New- " 
York Times, the New York 0 ! 
Daily News and Newsday. 

It was at New York News- * ‘ 
day after his return from r _ 
Europe in 1979 that he con-~ 
fumed his reputation as a pet-' 1 
ceptive critic of jazz in par-' 
ticular and a devotedly ' 
participatory observer of) 
New York City night life in 
general. ' 

Mr. Troup collaborated; • 
with Woody Herman, the big 1 
band leader, on “The Wood- 4/ 
chopper's Ball,” Mr. Her : ;’ 
man's autobiography. and : - 
completed it after the musP r 
dan’s death in 1987. " !•’ 


From the streets 
of Hong Kong 
to the hills 
of Ballykissongel. 
We're there for you. 


BBC World gives you 24 hr international news 
and information, plus business updates, current affairs, 
documentary and magazine programmes. BBC World reports 
from Hong Kong with a series of special reports on the 
historic handover to China. 

While Tim Sebastian presents HARDtalk, a powerful new daily 
interview programme, with revealing and often 
controversial conversations. 

BBC Prime the premier entertainment channel, has a 
rich variety of drama, comedy, films, natural history series and 
children's programmes. Ballykissongel offers viewers an amusing 
and delightful slice of life in Ireland's County Wicklow. 

And deep in the Umbrian countyside Antonio Carluceio 
celebrates with an Italian Feast of Northern Italian 
cookery, wine and culture. 

For advertising or sponsorship opportunities on 
BBC World, contact Nick Carugati 
on +44 171 580 5420 

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•r.ati .* I*P ‘ *"• 1*4 ‘.a* f*r .yinniffuiy lit 

/-_«U J _ sm* j ffc.vd. 4iod>fUtti C iprida*! 



By Michael Dihdin. 247 page. $230. 

Reviewed by Michael Dirda 

I F detective stories are the preferred 
recreation of noble minds — and they 
are — and if comic novels make the best 
holiday reading — and they do — and if 
Mozart is the greatest musical genius of 
all time — and he is — then Michael 
Dibdin's latest Aurelio Zen mystery 
should appeal to just about everybody. 
For here is what one might call a mystery 
buffa, set in modern-day Naples, and 
ingeniously modeled after Mozart’s 
most perfect opera, “Cosi Fan Tune.” 

Where thar radiant work plays up the 
fickleness of women, Dibdin uses his 
homage to undercut every sort of pre- 
tension. As he writes in a brief after- 
word, “the masculine form tutti spares 
no one.” Da Ponte’s original libretto, 
subtitled “The School for Lovers,” is 
elegantly constructed and balanced, us- 
ing only six characters. Two young sol- 
diers boast about their fiancees' stead- 
fast love, and an urbane bachelor friend, 
Don Alfonso, immediately challenges 
them to put that fidelity to the test So the 
men pretend to march away to war, only 
to reappear on stage made up as Al- 
banians. As agreed, each then attempts 
to seduce the olher's beloved. Surpris- 
ingly, the young women remain almost 
insufferably faithful — for a while. But 
eventually the carpe diem philosophy of 
a clever serving maid named Despina 
and the machinations of Don Alfonso 
prove too much for them. First one. then 
the other falls for her new suitor and 
finally agrees to marry him. But at the 
wedding feast the Albanians cast off 
their disguise, leading to finger pointing, 
shame and sorrow all around. 

At this dire moment, the worldly wise 
Don .Alfonso successfully urges that the 
couples marry anyway, according to 
their original intentions. After all; as he 
tells the two soldiers, women are all 
alike. Cosi fan rntte. 

Dibdin takes this rather cruel comedy 
and exuberantly reverses and enriches it 
He shrewdly updates some elements 
(e.g.. a double suicide attempt), adds 
characters, further complicates the plot, 
and alternates an almost Donald West- 
lake-style farce about criminal big shots 
compacted to death in orange garbage 
trucks with a touching novel about the 
nature of love and what used to be called 
authenticity. As in many famous operas, 
virtually no one in these pages is quite 
what be or she appears to be. 

Aurelio Zen has taken a low-level job 
in Naples because of political fallout 
from a previous case in Venice (see 
"Dead Lagoon”). Everyone at the port 
police station is amiably corrupt, which 
is fine with Aurelio who simply aims to 
enjoy a little Neopoli tan dolce far niente. 
In one of our first glimpses of this sar- 
donic and slightly bumbling policeman, 
he is “lying on the bed nude except for 
his socks, watching a Japanese cartoon 
featuring children with enormous eyes 
engaging in hand-to-hand combat with 
evil adversaries whose eyes were un- 
desirably small.” Alas, Zen’s compla- 
cency is shattered by two events: His 
attractive middle-aged landlady, who 
thinks his name is Afonso Zerabla, im- 
plores him to persuade her two daughters 
to break up.with their mysterious lowlife 
boyfriends, and a Greek sailor is stabbed 
to death in a restricted area of the port. 

Z EN soon convinces the besotted 
Orestina and Filomena to test tbe 
devotion of their lovers by going away for 
a few weeks to London; the handsome 
young men — to all indications middle- 
level Mafia soldiers — - appear genuinely 
disconsolate. Meanwhile, Zen hires two 
sexy prostitutes to seduce the lovesick 
Gesualdo and Sabatino. These profes- 
sional beauties pretend to be virginal Al- 
banian refugees, charitably lodged by 
nuns on the bottom floor of Zen’s bouse. 

Counterpointing the elaborate double 
seduction attempt is Zen’s investigation 
into the stabbing murder. The aliened 
killer insists that be “Only roik 

Engleesh,” and in a hilarious scene Ze| 
cross-examines him by mouthing th 
lyrics of some old rock songs, the on! 
English he himself knows, courtesy of 
former girlfriend: “ *Oh, yes. I'm th 
great pretender.’ he said, 'adrift in 
world of my own. I seem to be what I'c 
not. you see. Too real is this feeling o 
make-believe.’ ” Because the interrog 
ation is so funny in itself, one can casil 
overlook how the words of "The Gret 
Pretender” echo the novel's leitmotif o 

Inevitably, the murder inquiry. tK 
seduction scam, and the garbage true 
assassinations all converge fora farcica 
utterly improbable, yet nonetheles 
thrilling climax. Soon afterward, mask 
are dropped, lovers united or separatee 
secret identities revealed, and even 
long-lost father discovered Gaiety an 
joy prevail, as the curtain falls. 

Ail of this could seem merely twet 
were it not for Dibdin's vivacious style 
razor-sharp plotting and his wicke 
pokes at contemporary Italian mores 
Take Gesualdo, a believer in "the chad 
theory of urban driving.” At one potnl 
while racing at high speed through dens 
rush-hour traffic, he unexpectedly yell 
“over an excruciatingly loud and dis 
sonant blast of his horn at the mentai 
incompetent at the wheel of the ca 
ahead, who had very nearly caused ai 
accident by suddenly stopping, withou 
tbe slightest warning, at a stop light." 

Dibdin has won awards for his mori 
serious mysteries about Aurelio Zeri 
starting with the acclaimed “Raticing.': 
and also garnered plaudits for his con 
temporary black-humor novels, such a 
“Dirty Tricks.” His latest, however 
calls to mind a P.G. Wodehouse romp 
set in Italy with sexy characters: “Leavj 
it to Aurelio” maybe, or “Right Ho 
Zen!” “Cosi Fan Tutti” may not b< 
quite as much fun as a trip to Naples, c 
even a night at the opera, but it’s 
terrifically enjoyable entertainment. 

Michael Dirda is a writer and edita 
for The Washington Post Book World. 

By Alan Tmscott 

T HERE are inferences to 
be drawn when the bid- 
ding takes an unexpected 
turn. Without looking at the 
hand, study the auction 
shown in the diagram as far as 
six diamonds. 

North clearly has a 
long diamond suit and 
pects to make a grand slam. 
He has shown no interest in 
controls, so he must have 
first- round control in at least 
three suits himself: he would 
not risk such a bid if there was 
a danger that the defense 
could win the first two tricks. 
If he had one sure loser, he 
would probably choose a 



slower route, so two major- 
suit voids are likely, improb- 
able as that is in theory. 

So if you are South, you 
should visualize a hand w ith 
lots of diamonds and a sec- 
ondary club suit, with at least 
one major-suit void. 

North and South were Al 
Pagan of Westwood, New 
Jersey, and Wayne Roelke of 
Hawthorne, ' New Jersey 
playing in Wyckoff. New Jer- 
sey. This was a match-point 
game, and Roelke gambled 
with seven no-trump, hoping 
for a top score. He was un- 

On any lead but a club, 13 
tiicks would have rolled in. 
South can maneuver to dis- 
card dummy’s club losers be- 

fore he runs diamonds. But 
West had an obvious lead of 
the club jack, which des- 
troyed South s communica- 

All be could do was to run 
diamonds and go down two 
Using two club tricks at the 

If South had formed an ac- 
curate picture of his partner ’s 

hand, as he could have done 
he would probably have bid 
seven diamonds. The 
singletoa club was an omi- 
nous sign: if he had held a 
doubleton club the threat to 
jne partnership’s communi- 
cations would have been less 
saraws and seven no-trump 
wouJd have been a perfectly 
reasonable venture. y 

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By Howard Schneider 

Washington Post Service 

TROiS-RIVIERES, Quebec — They 
may have had different reasons for do- 
ing it in different parts of die coon try, 
bat Canadian voters coaid hardly have 
delivered a more confusing message in 
fte national legislative election. They 
chose five different parties to represent 
Canada's five regions. 

With a slim governing majority based 
overwhelmingly in Ontano.Prime Min- 
ister Jean Chretien welcomed what he 
described as a historic second mandate 
the first time Canada's liberals have 
wan consecutive majorities since the 
early 1950s. 

That in itself is a substantial feat. 
Liberal supporters said, after a first term 
in which the government reduced 
spending and tightened the eligibility 
rules for popular social programs such 
as health care, unemployment insurance 
and old-age pensions. 

“Majorities in Canada back to back 
are a challenge; we met it,” said John 
Rae, the Liberals’ national campaign 

Even though his party lost support in 
Monday's vexing and only narrowly 
held control of the House of Commons, 
Mr. Chretien said the Liberals alone 
now can claim standing as a party that 
represents all of Canada. The Reform 
Party, with the second-largest number 
of seats, failed to win any east of Man- 
itoba despite intense campaigning in 

Ontario by Preston Manning, the party 

“It's a great moment,” Mr. Chretien 
said of a vote that gave his party 155 of 
the 301 available seats. ‘ s We won a 
majority, and we have reals in all parts 
of Canada.” 

But just barely. 

In the eastern provinces, where the 
Chretien government's budget-cutting 
hit hard, the Progressive Conservatives. 
Canada's traditional Tory party, 


emerged with the largest nnmber of 
seats. Quebec, meanwhile, elected more 
members of the separatist Bloc Que- 
becois than any other party, denying Mr. 
Chretien and the Progressive Conser- 
vative leader, Jean Charest, the large 
gains they had expected. 

Liberals! giving them lofoM03 seats 
and providing a foundation - for 
Canada's governing party in the 
province that has perhaps tire deepest 
ties to traditional Canadian federalism. 

The prairie provinces of Manitoba 
and Saskatchewan helped restore the 
fortunes of the labor-based New Demo- 
cratic Party. Along with British 
Columbia and Alberta, they also helped - 
make the conservative Reform Party the 
official opposition — replacing the Bloc 
Quebecois — with 60 seats in the up- 
coming Parliament 

like Mr. Chretien, the leaders of the 

four, other parties could all claim sat- 
isfaction with the results. But they also 
acknowledged that the divisions in Ca- 
nadian society remained; Mr. 
Chretien’s Liberals may have won a 
majority, but they received less than 40 
percent of the popular vote, and two- 
thirds of their delegation comes from 
one province, Ontario. That, opposition 
leaders said Wednesday, is hardly an 
expression of national wilL 

At a news conference in Montreal, the 
Bloc Quebecois leader, Gilles Duceppe, 
■ predicted that Monday's vote would be 
the last federal election held 3m this 
province, as Quebec's French-speaking 
nationalists prepare for a provincial 
election expected to be called in coming 
months, and then another referendum 
on whether to leave Canada and form 
their own country. 

Tbe Bloc, which fields 
only in Quebec, won 44 of that 
province’s 75 seals. Although it drew 
only 40 percent of the popular vote in 
the province, Mr. Duceppe said the sov- 
ereignty movement was confident of 
winning the next referendum. 

Monday’s results helped that cause, 
he said, particularly western Canada's 
strong vote in favor of the Reform Party, 
which is being portrayed by separatists 
as evidence of widespread anti-French 
sentiment in English Canaria Of all the 
other party beads, Mr. Manning spoke 
most bluntly about Canada’s need to be 
more aggressive in opposing Quebec 


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Mr. Chretien hugging a supporter in Ottawa after his election victory. 

Day of Reckoning Nears for Mexico 9 s Ailing Ruling Party 

By Molly Moore 

• Washington Post Service 

MEXICO CITY- — For more than 
four decades, in election after election, 
Rodrigo Cruz has voted religiously for 
the candidates of Mexico’s ruling 

Not this year. Like growing numbers 
of Mexicans, the 63-year-old gas station 
attendant — for die first time in his life 
— is tinning against the long-ruling 
Institutional Revolutionary Party, or 

”1 want a change, and. the young 
people need a change,” Mr. Cruz said. 
' ‘My vote is for them, for a better future 
for than. The PRI is like a big and 
furious dinosaur who doesn't want to 
die. I say it is time for the PRI to die.” 
k Mexicans will vote July 6 in midterm 
'elections that could alter die political 
course of a nation that has been ruled tty 
the same autocratic party far 68 years — 
longer than any elected political party 

has governed anywhere else on the 

In the race that could have the 
greatest impact, polls indicate the PRI is 
likely to lose the first election ever for 
mayor of Mexico City, a post that had 

one of the world’s most populous cities 
and, as one of the most high-profile 
political leaders in the country, will be a 
presumed candidate for president in 

A senior party official conceded that 
it would “be very hard to defeat” die 
leftist opposition candidate, 
Cuauhtemoc Cardenas, who has tun for 
president twice and is the son of a le- 
gendary president who served in the 

But, in elections even more worri- 
some to the government, PRI officials 
fear that for die first time since the 
Mexican Revolution early this century, 
the ruling party could lose its absolute 

majority in the lower house of Congress. 
Even though the party will probably 
retain the highest number of lawmakers, 
its failure to win more dun half the seats 
would open die legislative branch to far 
more debate and scrutiny of die rating 
party than in the past 

'‘Many will hail this as a significant 
advancement toward democracy,” an 
economist, Jonathan Heath, wrote re- 
cently in a Mexico (City newspaper. 
“Others will underline the be ginnin g of 
an uncertain period of political instabil- 
ity. What we do know is that, for better 
or worse, it will be a road never traveled 
before in this country.” 

The ruling party's power base has 
steadily eroded in recent years as the 
right- of-centex National Action Party, 
or PAN, has claimed four of the coun- 
fity's 31 governorshms, a dozen pro- 
vincial capitals and 24 percent of the 
members of the lower house of Con- 
gress. In all. the pro-business PAN, 
which is particularly powerful in north- 

era Mexico, now governs 36 percent of 
Mexico’s population. 

The left-of-center Party of the Demo- 
cratic Revolution, or PRD, which gen- 
erally runs strong in Mexico's rural, 
impoverished areas, governs more than 
10 percent of the population. Polls this 
week indicated that 39 percent of voters 
surveyed favored the party's candidate 
for mayor of Mexico City, Mr. Carde- 
nas, by a whopping 20 percent over both 
the ruling party and PAN candidates. If 
the polls are confirmed on election day, 
the party would gain its greatest power 
base yeL 

The ruling party is also facing fierce 
competition m most of (he six stale 
governor elections. In the eyes of many 
voters, the PRI has become synony- 
mous with corruption. In the past year, 
investigations in Mexico, the United 
States and Switzerland have linked the 
older brother of former President Carlos 
Salinas de Gortari and many of Mr. 
Salinas's top officials and business as- 

sociates to money laundering, drug traf- 
ficking and other forms of corruption. 

Many Mexicans also blame the PRI 
for the 1994 collapse of the peso, which 
plunged the country into its deepest 
recession in six decades. Although in- 
ternational investments are trickling 
back in and the government is on more 
stable financial footing, millions of poor 
and middle-class Mexicans have still 
not recovered from the financial crisis 
that closed tens of thousands of small 
businesses, increased unemployment 
rates and bankrupted much of the 
middle class. 

The most visible sign of the con- 
tinuing economic and social dissatis- 
faction in the country has been the re- 
surgence of violent activity • by a 
guerrilla organization, the Popular Rev- 
olutionary Army, in Mexico's poor, 
southern Pacific coastal states. At least 
nine guerrillas and Mexican soldiers 
have been lulled in fighting in the last 


Turkish Helicopter 
Crashes in Iraq 

DIYARBAK1R. Turkey — A 
Turkish helicopter on a mission 
against Kurdish rebels in northern 
Iraq crashed Wednesday, killing 1 1 
military personnel, including two 
high-r anking officers, security of- 
ficials said. 

Officials at tire governor's office 
here in southeast Turkey said the 
helicopter went down in Iraq's 
mountainous Zap region. The Anato- 
lian News Agency said tire helicopter 
suffered a technical failure, but state- 
run television said it was not clear 
what caused the crash. 

A spokesman for a pro-Kurdish 
television channel said Kurdish 
rebels brought dowu a helicopter 
early Wednesday during fighting in 
the area around Zap. f Reuters ) 

Court Confirms 
Sentence for Tapie 

PARIS — An appeals court on 
Wednesday upheld the six-mouth 
prison sentence imposed on Bernard 
Tapie, the former sports tycoon and 
government minister, but ir dropped 
a ban on his business activity. 

The court upheld Mr. Tapie’s 
sentencing on fraud charges for 
evading taxes on his yacht, and 
upheld a 30- month suspended sen- 
tence for diverting company funds 
for the vessel 

But it dropped a 10-year ban on 
business activity, part of a second 
case. There was no immediate ex- 
planation for the change. (AP) 

Mugabe Says OAU 
WorCt Abide Coups 

HARARE, Zimbabwe — The 
Organization of African Unity 
called Wednesday for a return to 
democracy in Nigeria and Burundi, 
and the group's new chairman said 
Africa would no longer tolerate 
military takeovers. 

“We are getting tougher and 
tougher each time,” President 
Robert Mugabe of Zimbabwe said at 
the organization's s ummi t meeting 
here. “1 can assure that for future 
coups, it will be much tougher.” 

Mr. Mugabe said there was no 
contradiction between the OAU’s 
condemnation of the coup in Sierra 
Leone on May 25 and the presence 
at the meeting here of represen- 
tatives of the military governments 
of Nigeria and Burundi. ( Reuters J 

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nbune. Europe Needs a Currency for Growth and Jobs 

— M. . «rmno.T as fee German economy st 

Ukraine and Russia 

h Much attention was focused last 
week on Russian President Boris 
J Yeltsin’s trip to Paris, where he signed 
Da cooperation agreement with Western 
-'nations of the NATO military alKanee. 
•>But a trip he subsequently made to 
.'Ukraine may carry just as much sig- 
-hificance for future peace in Europe. 
n Mr. Yeltsin had planned on six pre- 
hvious occasions to visit Kiev, can- 
Heeling each time . His hesitation re- 
-•flected Moscow's difficulty in coming 
loo tarns with Ukraine, a Franco-sized 

? country that broke away from the So- 
avict Union in 1991. Many Russians 

avid Union in 1991. Many Russians 
.Jfound their loss of empire in general to 
nbe difficult, but the divorce from 
O'Ukraine was particularly wrenching. 

Russian history traces its origins to the 
sandent Kievan stale of Ros. Crimea 
-'■and its port city of Sevastopol figure 
a largely m more recent Russian history, 
b In contemporary times, Ukrainians and 
/Russians frequently intermarried; Rus- 
?. sians vacationed in Ukrainian towns on 
rrthe Black Sea; many saw — and some 
.1 still see — Ukrainian independence as 
-.a temporary aberration. 

So when Mr. Yeltsin finall y signed, 
<l on Saturday, a treaty recognizing the 
o sovereignty and territorial integrity of 
o-Ukraine, he took a significant step, 
b Russia renounced all border claims, 
-lit promised fair commercial treatment 
I'for Ukrainian exports. It won the right 
g<to keep its Black Sea fled based in 

Sevastopol, but only after recognizing 
f: Sevastopol and the Crimea as Ukrain- 
ian — and agreeing to pay rent fcx use 
s.of the porL 

One presidential visit, even with a 
solemn treaty signing, will not change 
Russia's mentality or end its debate 
about Ukraine’s nationhood. Moscow 
Mayor Yuri Luzhkov, a blustering na- 
tionalist positioning himself for a pres- 
idential run, com plain ed dmt “we will 
be renting Sevastopol from ourselves.” 
Many in Russia’s Parliament will op- 
pose the treaty. And Russia’s behavior 
toward smaller neighbors — such as 
Estonia, Latvia, Lithuania and Georgia 
— still often rests on intimidation and 
unjustifiable dawn #. 

But the Russia-Ukraine agreement 
is another vindication of NATO’s 
strategy of reaching eastward to former 
nations of the Soviet bloc. Ukraine is 
not a candidate for early NATO mem- 
bership, but it has endorsed NATO 
expansion and sought closer ties with 
the alliance. Those ties in turn helped 
convince Russia that if it wants to 
retain any influence at all. it should 
treat Ukraine as a sovereign nation, not 
as a vassal state. 

That decision may reflect tactics, 
not a change of heart But there is a 
good chance that the next generation of 
Russian leaders will see Ukrainian 
statehood as a natural thing , partic- 
ularly if both countries maintain their 
free market and democratic reforms. 
Whatever their respective motives, it 
can only be positive that Mr. Yeltsin 
and Ukrainian President Leonid 
Kuchma are building a structure of 
normal state relations for that next gen- 
eration to inhftrif- 



Canada Keeps Splitting 

‘ l Prime Minister Jean Chretien's Lib- 
7 erais barely won their predicted victory 
in Monday’s elections, but the cracks 
■'in the Canadian federation are wider 
' than ever and his party’s majority has 
1‘been shaved to a handful of seats. As 
/ before, he has to cope with a still 
! formidable separatist party in Quebec, 
’ where the prune minister almost lost 
this own constituency. Yet the most 
' interesting result was die revolt that 
,J swept die western provinces, giving 
• die rightist Reform Party 60 seats and 
*' thus making Preston Manning die of- 
u ficial opposition leader in Parliament 
r The evangelical Mr. Manning has 
■’'tapped resentment against Quebec, 
■'high taxes and big government, but his 
•^decade-old party draws most of its 
■'support from Alberta and British 
"Columbia and has virtually no pres- 
ence east of Manitoba. For much of this 
century the Canadian West has served 
—as a takeoff platform for yeasty. 

damentalist lay preacher, William 
“Bible Bill 1 ' Aberhart, founded the 
Social Credit Party in Alberta, and 
through weekly radio broadcast re- 
cruited a fervent following. Promising 
a “social dividend” of $75 a month to 
every citizen, the party won control of 
Alberta in 1935. The central govern- 
ment blocked its funny-money 
schemes, but the party flourished nev- 
ertheless, and in 1952 won control of 
British Colombia. Elsewhere in the 
West, the voters of Saskatchewan in 
1944 elected die Cooperative Com- 
monwealth Federation (CCF). This 

avowedly socialist government held 
power until 196 6. Over time. Social 
Credit and Bible Bill faded into folk- 
lore, while the CCF became the 
present-day New Democrats. 

But the politics of protest obviously 
continues to bubble in western pro- 
vinces. The problem for a weakened 
prime ministeF-and for Canadians- is ■ 
that Mr. Manning risks lighting aprair- - 
ie fire of chauvinism destructive of the 
very conservative values he professes. 


r oddball and genuinely radical political 
I movements that somehow sputter out 
S on die long voyage eastward. 

S on the long vt 
During the 

;e eastward, 
at Depression, a fun- 

Wishful France 

France today las the highest un- 
employment rate among leading in- 
dustrialized nations. The triumph of 
the left in Sunday’s elections reflects 
voters’ understandable anxiety about 
this state of affairs. Unfortunately, the 
winners' program, if carried out, is 
likely to make the problem worse. 

Conservative President Jacques 
Chirac gambled when he called early 
elections, hoping for a Parliament that 
would support turn during the remain- 
ing five years of his term. Instead, 
his conservative allies lost badly to 

the Socialist and Communist parties. 
Now Mr. Chirac will uncomfortably 

Now Mr. Chirac will uncomfortably 
share power with a leftist government 
led by a Socialist prime minister, Li- 
onel Jospin. 

As in any election, diverse factors of 
personality, tactics and policy played 
their parts. But the chief issue was one 
that confronts the United States and 
every other nation as well: how to 
balance the needs and desires of each 
country's population with the harsh 
rigors of economic globalization. 

In today's world, technology and 
capital are increasingly mobile; busi- 
nesses can set up shop wherever profits 
will be greatest. Not only can they, 
businesses that pass up opportunities 
— out of loyalty to their home com- 
munities or countries, for example, or 
by order of home governments — may 
soon be passed by. Thus, nations find 
their own political possibilities lim- 
ited; if they set taxes high to fund a 
generous social safety net, businesses 
will move away, shrinking the tax base 
and requiring even higher taxes. 

France has one of the highest tax 

rates around; public spending unis 

for more than of half its total &■. omy, 
compared with about one-third in the 
United States. Government employs 
one-quarter of all workers, compared 
with one in seven in the United States. 
Nationalization of industry does guar- 
antee that some jobs stay in France, and 
generous benefits — early retirement 
ages, for example — are lovely for 
those with jobs. But both discourage 
private job creation; the unemploy- 
ment rate in Ranee is nearly 13 percent 
and growing. 

Now comes Mr. Jospin, promising 
to suspend privatization of industry, 
create 350,000 new government jobs 
for young people and reduce the work- 
week from 39 to 35 hours with no cut in 
pay. Sounds lovely again; but gov- 
ernment jobs require taxes, which 
drive businesses away, and mandating 
shorter workweeks and other benefits 
increases the costs to business of cre- 
ating new jobs. The policies, in other 
words, would have the perverse effect 
of increasing unemployment. Mr. 
Jospin has yet to explain how he can 
accomplish his goals without raising 
taxes, which he promised not to do. 

No nation has come to satisfactory 
terms with globalization. Many Euro- 
peans would say that America, with its 
remarkably successful record of job 
creation, has sacrificed too much in the 
way of equality, social welfare and 
public infrastructure. But it is safe to 
say that wishfulness, which seems to 
be the underlying mood in the French 
electorate, won't repeal the new laws 
of global economics. 






KATHARINE P. D ARROW. Vice Chairman 

RICHARD McCLEAN. Publisher & Chief Executive 
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£1997, Iniernaatxtat Herald Tribute. AB rights mend ISSN ■ 02948052. 

— WelL the French have done 
their tiling. The left has won and Lionel 
Jospin is prime minister. Although 
most of the policy implications are still 
rather uncertain, one is quite clean The 
euro is in big trouble. Which may be the 
best thing that has happened to it since 
the single currency was conceived. 

The campaign and its results show 
that the French simply will not accept 
the croemstean austerity programs 

1 ! .1 A ..J 

By Robert A. Levine 

necessary to bring the deficit and other 
measures within the Maastricht criter- 

Fortunafidy .political events in the amaz- 
ing month from May 1 to Jane 1 may 
trgrirp- it possible to change and save it. 

The Maastricht euro has been the 
wrong euro. It has been a central 
bankers' euro, a euro used by the Top 
People in the banks and the finance 
ministries to tell everyone else: “Struc- 
tural reform is tbe ri ght answer and you 

• A erowth currency. strong j as foe Gqmanccoo amy smks. 

rAn^KSSreacy. Or perhaps not Hus Gmnxry of the 

• A currency that makes it possible next 12 mpmbs is also the Germany m 

to use macroeconomic means to com- which for re- 

suffer from needed 

struct^ reforms, rather than punish* mitscnn^dneoiOTltea^wdJgD 

!^|)<> I' I” 

ing them additionally. 

• A currency that takes in the major 
West European economies, including 

Italy Spain — and Britain. 

• Most nuponant a currency under 

- . ■* '* 

measures within the Maastricht criter- 
ia. And Ate French election has co- 
incided with tile clownish clumsiness 
of the German attempt to soNe its own 
Maastricht problems by revaluing gold, 
and the consequent conflict between 
the government and the Bundesbank. 

Together, the two events have either 
killed tire 1999 monetary union or have 
twisted it so farout of recognition tbai it 
might as well be dead. 

most accept it because it is good for 
you. Tea to 15 percent unemployment 
is bitter but you need it” 

As events have shown, that is unlikely 
to fry in a democracy. Long-run struc- 
tural reforms are in fact needed toreduoe 
European unemployment, but short-run 

rather than tire rigid rules ox central 
hunkers and economic theorists. 

Such a currency mi gh t seem attract- 
ive to the new governments of Britain 
and France, but what about the Ger- 

mans? Germany would not accept the 

European unemptoymait, but shoct-run softness of sura entena; the Germans a. . Emo^n ranracy. 

reS^^S^^bymacroeco- want foe firm rigor of the Deutsche M^ybc even Mr. KoW jronWdo so* m 

nomic (fis^dmonet^r) measures mark. The DM is the symbol of Graman d * n * to avoid 

quite incompatible with foe Maastricht prosperity, and nothing less wD do. 

to make the re- P S prosperity? Id j i Germany 

forms politically acceptable. with uneroploymrat above 10 percent, a , Europe could teke a Jmal i step a. re- . 

the way of Alain Juppd. (A historic a l 1 
more just comparison might be to Win- , 
ston ChurchilL but font would be cold., . 
comfort for the chancellor.) i 

la any .case, if Mr. Kohl goes, be , i 
might be succeeded by Oskar Lafoor.. 
taine or Gerhard Schroder of the Social, , 
Democrats, or perhaps by the Christian 
Democratic equivalent erf Philippe 
Sgguin, the last-minute leftish hope of . 
the French conservatives. Then, per- ; 
haps, Germany might participate in foe 
redesign of a.. European currency. 
Maybe even Mr. Kohl would do so* in 


wm ** m 

a •: *- 

. * 

e • •*’*» Krti 

could take a final 

m. re- 

tap .£=£= 0 **. 10 percent a , ta»Ultb ^ t * 

But^monfoSSSted with Lionel Germany foiling in the expenave re- “no^raoffoeGernfflnpecjletotfie 
jsnin began with Tony Blair. The new ooosfoictiou (rf its eastern Lander and need for a flexible pr^powth conracy . 

ksts assssassw 

foe Emopean Union does not continue to the euro, but it is clearly saying “not rial programs^ Germany ^ . economia __ 

toward mregration, it might well re- dow" to the Maastricht euro. Suppose suffer most from a rigid euro or even a The 

verse coureetoward dirin^ration. that the new governments on both sides oontinumg rigid Deutsche mark? 

^eWtoTStowevcr, is of the Channel were to design a new- Perhaps foe symbol of the pure uxd thiscomment to the lmenumorud 

and always has been tbe wrong answer, model integrated currency, onethat is: Deutsche mark will become even lie rout inoune. 

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Heed the Nuclear, Biological and Chemical Terrorist Threat 

W ASHINGTON — The de- 
stnzction of the federal 

By Joseph S. Nye Jr. and R. James Woolsey 

building in Oklahoma City and 
the bombing of the World Trade 
Center in New York shocked 
Americans. Those tragedies 
would have been for worse if 
nuclear, biological or chemical 
materials bad been involved. 
After co-chairing a yearlong 
study for the government, we 
believe it is increasingly likely 
they will be. 

For 40 years, Americans 
lived under tbe fear of Soviet 
nuclear attack. The end of the 
Cold War reduced foe prospect 
of a nuclear holocaust, out pro- 
spects of a nuclear explosion 
inside the United States prob- 
ably have increased. 

It is not just the nuclear threat 
Terrorists worldwide have bet- 
ter access to anthrax, ricin or 
sarin Qian to nuclear materials. 

graduate students or lab tech- 
nicians. Recipes are readily 
available on the Internet. 

Out overriding recommen- 
dation is to give foe threat of 
terrorism with weapons of mass 
destruction the highest priority 
in U.S. national security policy. 
Of the threats that could inflict 
major damage to America, such 
terrorism is the threat for which 
it is least prepared. 

The nation needs a national 
response pro gr am , directed by 
the White House. Tbe program 
must be coordinated and inte- 
grated across foe entire federal 
bureaucracy. And end-to-end 

stematic strategy to counter 
s threat must address all 

phases of a potential terrorist 
attack, from detection and pre- 
vention to response. 

Such a strategy should in- 
clude and coordinate program 
initiatives by all involved de- 
partments and ag encies . To this 
end, we recommend that policy 
direction be clarified at tire 
White House level by a com- 
mittee chained by the vice pres- 
ident; interagency and interde- 
partmental coordination and 
integration be handled by depu- 
ties of the involved organiza- 
tions; tbe program be supported 

by a long- term funding strategy; 
an independent advisory board 
of outside experts be appointed 
by foe president to monitor and 
advise the program. 

The very nature of U.S. so- 
ciety makes it difficult to pre- 
pare for this security problem. 
Within recent memory, Amer- 
icans have not had to battle a 
foreign invading force on U.S. 
soil Because of our "Pearl Har- 
bor" mind-set, we are unlikely 
to mount an adequate defense 
until we suffer an attack. 

Because the threat of terror- 
ism with weapons of mass de- 
struction is amorphous (rogue 
states transnational groups, ad 
hoc groups or individuals) and 

constantly changing, it is hard to 
make predictions and prepare- - 
lions. But given foe current geo- 
political state of the world, there 
is every indication that terror, 
ism will be the most likely phys- 
ical threat to the U.S. homeland 
for at least the next decade. ! 

Only if we go beyond busi- 
ness as usual and respond in a 
broader and more systematic 
manner do we stand a chance pf : 
dealing with this problem. 


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Mr. Nye is a former assistant 
secretary of defense, and Mr. 
Woolsey was CIA director in the 
first Clinton administration. 
They contributed this common 
to the Los Angeles Times. 

-hr '• .*•*, 

So for we have been lucky. 
Bur we should not wait for a 
another Pearl Harbor to awaken 
us to foe fact that there is no 
greater threat to our security 
than terrorism involving wea- 
pons of mass destruction. 

Skeptics may call us alarm- 
ists. Nuclear technology has 
been arcmndTor 50 .years, and 
chemical and biological agents 
for neady a century, yet terror- 
ists have rarely tamed to them. 
Conventional high explosives 
are easier to obtain. Moreover, 
terrorists seeking to promote a 
cause run the risk of a moral and 
political backlash if the destruc- 
tion they wreak seems dispro- 
portionate to their cause. 

But recent years have seen 
the rise of a new type of terrorist 
less interested in promoting a 
political curse ana more fo- 
cused on retribution or erad- 
ication of what be defines as 
evil. The motives are often a 
distorted form of religion, and 
the imagined rewards are in the 
next world. For soch people, 
weapons of mass destruction, if 
available, are a more efficient 
means to their ends. 

Such devices are becoming 
more available. The breakup of 
the Soviet Union and the rise of 
foe mafias in Russia have in- 
creased the smuggling of nuclear 
materials. Chemical and biolo- 
gical agents can be produced by 

Clean Up the World’s Glut of Surplus Weapons 

B ONN — Cleaning up after 
the Cold War is pro vine 

13 the Cold War is moving 
harder than expected. Surplus 
weapons can global prolifera- 
tion, civil wars and arms races. 

Agreeing oo international 
disarmament or reducing uni- 

By Michael Brzoska and Herbert Wulf 

- -«-~4 to-tor 

- • “m 

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weapons -grade fissile material 
await further disposition. 

One out of three heavy con- 
ventional weapons in militar y 
arsenals in 1990. had been 

laterally, important as those rendered surplus by 1995. Net 
steps are, is not the end of the reductions m Holdings from 

story. Disarmament also re- 
quires managwmnt of the sur- 
plus of weapons and weapons 
material created by reductions. 
Tbe Chemical Weapons Con- 
vention. which entered into 
force at the end of April, sets a 
good precedent in tins respect 
The surplus weapons prob- 
lem has taken governments and 
international organizations by 
surprise, due primarily to the 
sheer magnitude of foe accu- 
mulated surplus. 

Post-Cold War disarmament 
has been dramatic and rapid. 
Through 1995, foe share of 
world military expenditures in 
GNP was halved from about 5 
percent to about 2.6 percent 
within a span of eight years. A 
large backlog of surplus 
weapons and weapons material 
has accumulated as a result 
Nuclear disarmament after 
foe 1987 Intermediate Nuclear 
Forces Treaty led to foe dis- 
mantling of about 5,000 deliv- 
ery vehicles and 18,000 nuclear 
warheads. Hundreds of tons of 

1990 to 1995 add up to 165,000 
heavy conventional weapons. - 

We lack reliable data for 
smaller arms, but find indica- 
tions that cuts have also been 

-The Chemical Weapons 
Convention aims at completely 
eliminating chemical weapons 
— more than 70,000 tons — 
within 10 years. 

While there is agreement 
among surplus- producing states 
not to tolerate any further kind 
of proliferation of chemical or 
nuclear weapons material, tbe 
danger is clear and imminent 
Indecision about disposition of 
chemical and nuclear weapon 
materials, insufficient storage 
and control, and lack of finan- 
cial resources to carry out de- 
struction in Russia should put 
everyone on high alert. 

For conventional weapons 
there are no agreed limitations, 
so proliferation is happening in 
grand style. Many governments 
apply less strict controls to 
transfer of old weapons than to 

transfer of new ones. Tbe in- 
ternational trade in old weapons 
has reached record heights. 

More than 18,000 used tanks, 
aircraft, artillery pieces and ma- 
jor ships were exported in the 
' &iOmf of foe 1990s . Judging 
from information about recent 
wars, trade in used light 
weapons has been even more 
buoyant. Rifles, for instance, 
are now circulating from one 
crisis spot to the next. 

The "Afghan pipeline" to 
help the Mojahidin fight the So- 
viets brought millions of rifles 
to the region, and to Kashmir 
and Sri Lanka. Many of those 
rifles also found their way to 
Algeria and Burma. 

Cost-benefit considerations 
have led surplus-creating gov- 
ernments to sell rather than de- 
stroy surplus, often at bargain 
rates. Low prices increase foe 
number of arms in circulation 
and make them especially at- 
tractive to those who cannot af- 
ford more modem weaponry. 

What is surplus for a modem 
army is still useful for fighting 
enemies who are also armed 
with outdated weapons. 

In certain cases the availab- 
ility of surplus heavy weapons 
has fanned regional arms races. 
Relations between Greece and 
Turkey have recently been fur- 

i urxey nave recently been fur- 
ther aggravated by large deliv- 

Partners Should Nudge Burma 

J AKARTA — Tbe recent de- 
cision bv the Association of 

J cision by the Association of 
South East Asian Nations to 
admit Burma as well as Cam- 
bodia and Laos as members 
next month was made for stra- 
tegic reasons — to unite foe 
region politically for the first 
time, and to prevent Burma 
from becoming overly depajd- 
ent on one great power, either 
Hiina or India The aim is to 
create a more cohesive South- 
east Aria, better able to resist 
outside intervention and main- 
tain the region’s peace, stabil- 
ity and economic dynamism. 

But foe decision to bring 
these three countries into 
ASEAN — which currently 
consists of Brunei, Indonesia, 
Malaysia, the Philippines, 
Singapore, Thail and and Vi- 
etnam — will bring costs as 
well as benefits, especially 
with Burma. 

Already, Western coun- 
tries, including the United 
States and Europe, have crit- 
icized the move, arguing that it 
will help legitimize foe Bur- 
mese military regime and 
should have bren delayed until 

By Josuf Wanandi 

It is not only the West that is 
pointing to Burma’s bad re- 
cord, including the military 
regime's refusal to recognize 
foe results of elections in 1 990 
that were won convincingly 
by the opposition National 
League for Democracy led by 
Daw Aung San Suu Kyi, the 
Nobel Peace Prize laureate. 

Significant domestic con- 
stituencies in ASEAN, such as 
the press and nongovernment- 
al organizations, have *icn 
criticized Rangoon for show- 
ing no willingness to improve 
the political situation. In their 
eyes, Burma’s military rulers 
lack decency and legitimacy. 

It is important for ASEAN 
to lay down a road map for its 
three new members so that 
they adjust to foe group’s prin- 
ciples. In foe economic field, 
they should adopt sound mac- 
roeconomic policies. 

A road map for sociopol- 
itical development is espe- 
cially important for Burma. 
Tbe government must onder- 

zation and assembly in Burma, 
as well as freedom of expres- 
sion, most be recognized and 
implemented gradually. Dia- 

should be established s^that 
their role under foe new con- 
stitution can be worked out 

Last but not least, a general 
election should be held in the 
not too distant future to form a 
new government. Perhaps a 
two- or three-year preparation 
period would be adequate and 
couj^tegoposed to Rangoon 

One sticking point will be 
the role of Daw Aung San Suu 
Kyi in tbe dialogue, tbe elec- 
tions and the next govern- 
ment This will not be easy, 
because she and foe country’s 
. military leaders show no sign 
of willingness to compromise, 
something that is essential for 
a political solution. 

Here ASEAN could play a 
role. Despite foe principle of 
nonintervention in each oth- 
er's affairs that ASEAN es- 
pouses. it would be right to 
make an exception in Burma’s 

eries of old weapons, predom- 
inantly from Germany and the 
United States. 

The various wars on the 
southern periphery of the 
former Soviet Union are mostly 
fought with surplus weapons, 
some stolen from old invent- 
ories but many hantfej over by 
the new Russian authorities. 

The surplus of nuclear, chem- 
ical and conventional weapons 
is likely to remain an important 
security, economic and ecology 
issue well into the next century. 

The many technical questions 
relating to stockpiling, deliber- 
ate obsolescence, scrapping,* 
conversion or export are for 
from settled. And stockpiles 
will keep on growing. 

Measured on a worldwide 
scale, disarmament in 1997 is 
containing, but at a slower pace ‘ 
than in foe early 1990s. ” 1 ’ 

The immediate priority in foe 
nuclear field is to ensure the 
safety and stability of currebt 
stockpiles of fissile material jn 
Russia. As for destruction of 
chemical weapons, many tech- 
nical and financial problems re- 
main. and it is important to get 
the Russians on board. Both ef- 
forts will cost the West \ 

Surplus conventional wea- 
pons should be destroyed. Ex- 
port controls for surplus wea- 
pons should be no more lenient 
than those for new weapons. . 

Donors and aid organizations 
should be prepared to deal di- 
rectly with weapons within con- 
flicts and to support measures of 
practical disarmament in post- 
conflict areas. Liberia, for in- 
stance, now needs such helpti) 
prevent a restart of foe war just 
Because the guns are around ; 

On a more general level, com- 
prehensive policies for the ef- 
fective management of surplus 
weapons have to be institution- . 
alized to preserve the mo- 
mentum of disarmament Tbe 
Chemical Weapons Convention 
holds foe promise of being out- 
standing m this respect The 
fields of nuclear and conven- 
tional weapons field lag behind 

’*5- . * .>■*!»*• 

V - -=* ■ - 




i . Nv> ( Ot Ilk'll 

I ).;'relopnierti 

Mr. Brzoska is research di- 
rector and Mr. Wulf director -at 
the Bonn International Center 
for Conversion . which recently 
published '* Conversion Survey 
1997: Global Disarmament 
and Disposal of Surplus 
Weapons." They contributed 
this comment to the Interna- 
tional Herald Tribune. 


1897: U.S. Citizenship 

taan, U.S. Secretary of State, 
has under consideration a new 

tablishment by a member of foe 
working force is dealt with by 
that force. Another interesting 
manifestation is the “Poor 
Man's Court,” extra-judicial. 


•J> =« 1u 

fr^y with Spain relative to foe 

_ Q - w U» wnjen is expected to do away 

°1 wi * foe red-tape and about 75 
between foe United per cent of foe volume of cur- 
«« litigation and tit minimi* 

snouia nave been delayed until iw government must under- case. But it should be done 
there is clear evidence diathu- stand that membership in quietly in foe light way foe 
man rigfrtsabuses and political ASEAN brings with it not only ASEAN way. 
repression are being eased. rights but also obligations. - 

Such critician could com- For example, foe coostitu- The writer, chairman of die 
plicate ASEAN s important txon that the government has supervisory board of the Cm- 
reJations with the West. It promised for four years should ter for Strategic wul Intema- 
could also damage foe group s be fmal^ed and promulgated tiemal Studies in Jakarta can- 
starure and credibility, redu- well before foe end of this tributed this comment to the 
cing its influence. year. Some rights of organ!- International Herald Tribune 

facility with which the Cubans 
have been able to obtain 
naturalization. The Treaty pre- 
vents fraudulent naturalization. 

Most of foe so-called American ln<i « A . , 

citizens in Cuba have no in- Atomic AgeWy ■ 

srs©""® ssKaasK; 

5* vocated by Russia would be a - 

1922: Work Discipline iSS " ^ fiEtf £ ! 

crease tbe danger of atomic 1 


creation of wmiaratiwal 
agency with foli control rfaiom- 

‘-^“uuucu m tne es- ic matte rs in every country. • ♦ 

its cost. The creator of fois > 
tribunal is the Arbitration So- 
ciety of America. 



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*j All Right, Take the Fifth, 
But Do It in Person 


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W ASHINGTON — Not since 
tbe Kefauver hearings ex- 
! posed OTganized crime 46 years 
i ago has a major Senate inves- 
; dganoD been resisted by such an 
array of key witnesses talking of 
taking the Fifth Amendment 
against self- incrimmatio o - 
Another Tennessee senator, 
Fred Thompson, chairman of the 
Government Affairs Committee 
looking into the Asian penetration 
' of the Clinton campaign, has been 
rebuffed by 12 key figures — plus 
. 16 Buddhist monks — so far. 

• Yah Lin (Charlie) Trie, the 
' donor who brought China's top 
! arms dealer into President Bill 
; Clmton’sof^, won’t testify. Nor 
: will Mark Middleton, an aide to 
! Mr. Clinton’s chief of staff, whose 
, Asian dealings gave new meaning 
: to “White House Mess.** 

Johnny Chung, a 49-time vis- 
; itor who gave $366,000, partly 
t through Hillary Clinton's staff di- 
; rector, refuses to testify, as does 
l Pauline Kancbanalak of Thailand, 
Maria Hsia of the abused 
Buddhist temple and the famously 
hushed Webster Hubbell. 

John Huang will not testify to 
the Senate. He was the Commerce 
official who Mr. Clinton, in a 
■ Sept 25, 1995, Oval Office meet- 
- 'ing, transferred to the Democratic 
-Finance Committee, presumably 
- to pick up lOUs generated while 
' Mr. Huang was at Commerce. 

7 (However, the Justice Depart- 
- ment awaits a “proffer” — an 
offer of evidence about others — 
- from Mr. Huang. If any such prof- 
- fer before or after an indictment 
j 1 shows presidential involvement 
■ in illegal fund-raising, Justice 
would finally pass the case to an 
independent counsel.) 

>• The network of naysayers to the 
'Congress, whose silence appears 
■coordinated by a corps of private 
and public attorneys, includes five 
"others whose names I can't get 
The stone wall has its fissures — 
some FOBs, or Friends of Bill, are 
giving Senate depositions — but 
rarely has Congress been so sys- 
tematically stiffed. 

How can the Senate break 
through? Step One is to call all 
these witnesses to a public bearing 
. . } ' -111 July, before the August recess. 
-• --Let those who wish take the oath 
' "and then personally give their 
" ; variations of "I decline to testify 
because anything I say may tend 
-■ ‘ , ’fo incriminate me." 

I’m a civil libertarian who : 
tbe ACLU when it fails to 
u npopular stands. I believe that the 
right of individuals not to' testify 
against themselves is sacred, and 
that it is un-American to impute 
guilt to invokers of the Fifth. 

But there is no right or law or 
even custom Ihat says the Fifth 
should be taken only through law- 
yers by letter. It’s easy to go along 
with lawyers who say, “I’ll notify 
the committee you won’t testify.” 
Witnesses are more likely to testi- 
fy when required to come before 
the Senate to decline in person. 

Estes Kefauver resolved the 
publicity problem for Fifth-takers a 
half-century ago. He ruled that wit- 
nesses could demand that their 
faces not be televised. One of early 
television’s enduring images is that 
of the bands of Frank CosteDo, the 
leading racketeer, as he asserted his 
right not to testify and preference 
not to be seen. The time has come 
for another show of hands. 

Step Two is to counter the cabal 
of White House and Democratic 
National Committee lawyers and 
some Democratic senators deter- 
mined to delay the proceedings 
until the committee clock runs out 
on Dec. 31. 

We saw this conspiracy work 
when a witness from a California 
Buddhist temple was in Wash- 
ington to appear before a grand 
jury. Senator Thompson wanted 
to subpoena her. But Democrats 
leaned on the ranking minority 
member, John Glenn, to delay the 
issuance, which he uncomfortably 
(fid. The subpoena was not issued 
until after the witness, Hsia Cha 
Lin, left town. On Tuesday, law- 
yers for 16 Buddhist monks told 
the committee their clients may 
take the Fifth. 

The foot-dragging conspiracy 
is also at weak in the DNC’s re- 
fusal to turn over fund-raising pa- 
pers to the Senate with the delay- 
ing tactic of lawyer-client 
privilege. This apes Clinton 
claims being appealed to the Su- 
preme Court to drag out the in- 
dependent counsel's Whitewater 
investigation. Only reason for the 
DNC claim: delay. Pimer Senate 
response: Vote promptly to seek a 
court's civil contempt order. 

Americans have a right to take 
the Fifth. The public has aright to 
see Mr. Clinton’s organized 
parade of supporters taking it. 

The New York Times. 

The Stressed Society: 
Americans and Time 

By Robert J. Samuelson 


Croatian Abuses 

Regarding “ Croatia Quietly 
Seizes Monies of Serbs Who Fled 
War ” (May 15): 

Tbe Croatian government pro- 
gram to confiscate thousands of 
houses that once belonged to eth- 
nic Serbs runs afoul of die Euro- 
pean Convention for the Protec- 
tion of Human Rights and 
Fundamental Freedoms. The first 
protocol to the convention has 
been held to require just com- 
pensation for the legitimate taking 
of property. 

The Croatian confiscation is 
neither legitimate nor accompan- 
ied by just compensation. The ex- 
istence of such a program of abuses 
alone should bar membership for 
Croatia in the European Union. 


New York. 

The writer is director of the 
Open Society Institute. 

Battling Bribery 

Regarding "OECD Takes a 
First Step in the Battle Oyer 
Bribery ’* (May 29): 

The article reports that the Or- 
ganization for Economic Cooper- 
ation and Development will make 
renewed efforts within a year to 
follow tbe precedent of the United 
States, to convince member states 
to enact legislation to make cor- 
porate bribery of foreign officials 
a criminal offense. Best of luck! 

banking, legal and accounting 
firms, the facts of today’s busi- 
ness life make one pessimistic 
about curtailing business bribery. 

For the OECD initiative to lead 
to enforceable action against cor- 
porate bribery, theft of national 
wealth and other sources of illicit 
money worldwide, all on- and off- 
shore bankers, lawyers, account- 
ants and operators of national bor- 
der-penetrating electronic money 
transfer systems will have to be 
conscripted into the battle. 



The writer is director of the 
Centre for Accountability and 
Debt Relief. 

Hong Kong Island 

Regarding “ Rock of Ages” 
(Letter. May 13): 

Yes, part of Hong Kong was 
leased' to Britain for 99 years. But 
Hong Kong Island? The island 
was ceded in perpetuity to Britain 
under the 1342 Treaty of Nan- 
king. In spite of this, Hong Kong 
Island will also be given back to 
China on July 1. 

So perhaps Gibraltar is right to 
ponder Hong Kong’s fate. 

PAMELA S. corn. 


Pleasant Memories 

In the midst of all the horrendous 
news about die Congo, it was re- 

in the competitive world of top. freshing to read John Vinocur’s 

story “When Zaire Didn’t Seem to 
Make the Really Worst Big 
Leagues” (Meanwhile. May 23). 

Like Mr. Vinocur, 1 have very 
pleasant memories of the Congo/ 
Zaire and at«m say that I quite 
loved the place. I was there in the 
hue 1950s. Our bouse — the res- 
idence of the American consul 
general (my father) — was on the 
banks of the Congo River, and 
every day L too, watched the b ‘lily 
pads and clumps of hyacinths 
bobbing on its brown wavelets." 
We risked bilharzia and crocodile 
attacks to swim in and even water- 
ski on that muddy river. 

But my memories encompass 
more than just the country's geo- 
graphy: Indelibly etched in my 
mind are the people like my Con- 
golese classmates in elementary 
school who straggled even more 
than I did with French, Flemish, 
Latin and Belgian geography and 
history; and adventures such as 
taking the paddleboat down the 
river from Kisangani/Stanleyville 
to Kinshasa/Leopoldville. 

I do not mean to imply that the 
1950s were golden years for the 
Congo. On the contrary, the Bel- 
gians are to be faulted for taking 
everything and giving nothing to 
their African colony. Nonethe- 
less, unless Laurent Kabila can 
dramatically reverse the dismal 
legacy of both the Belgian col- 
onizers and Mobutu Sese Seko’s 
32-year regime, die news from the 
Congo can only get worse. 




Americans are addicted to 
anxiety (aJc.a. “stress"). We de- 
plore it and claim to resist it, but 
we actually crave it and aggress- 
ively pursue it We overschedule 
ourselves and our children and try 
to cram ever more activity into the 
day. We are awash in time-saving 
devices that, lo and bebold, con- 
sume more and more of our time. 
As a result, we have never had 


more free time and have never felt 
so oppressed by the scarcity of 

Every new gadget spawns new 
stress. On plane trips — which 
often provide rare opportunities 
for idle time — the tiny screen of 
the GTE Ahfone urges us to resist’ 
Why Wait? Check Voice Mail- 
Call the Office. Phone the Kids. 

The very devices that were sup- 
posed to ease the demands on our 
time create new demands. We're 
flooded with faxes, recorded mes- 
sages and e- mail. This is virtual 
anxiety. We need never be out of 
touch with our (or someone 
else’s) concerns. The latest per- 
sonal or global calamity can be 
“accessed" instantly. 

These are new expressions of 
an old condition. Even in 1 97 1 , 73 
percent of adults (those 18 and 
over) judged themselves "al- 
ways" or "sometimes" rushed. 
By 1995 that was 83 percent Yet 
free time is clearly on the rise. We 
live longer, retire earlier and 
spend less time on the job. In 1920 
average life expectancy was 54; 
now it is 76. The factory work- 
week in 1920 was 47 hours; now 
the average workweek is 39. This 
process continues. Free time — 
loosely defined as what remains 
after sleeping, eating, child care, 
housework and the job — is still 

We know this from a new study 
by John Robinson, professor of 
sociology at toe University of 
Maryland, and Geoffrey God bey, 
professor of leisure studies at Penn 
State (“Time for Life: The Sur- 
prising Ways Americans Use 
Their Time'’). It is not merely that 
later marriage, fewer childre n and 
earlier retirement continue to re- 
duce two large claims on people's 
time: jobs ami child-rearing. Even 
for workers, free time has gen- 
erally increased. Between 1965 

and 1985, the average time spent 
by employed men at their jobs 
dropped from 47 to 40 hours a 
week, reckon Mr. Robinson and 
Mr. Godbey. The decline for wom- 
en was from about 37 to 31 hours. 

The Bureau of Labor Statistics, 
however, puts the average work- 
week in 1996 at 42 hours for men 
and 36 hours for women. But 
those figures come from a small 
part of a long survey with ques- 
tions on many subjects. Typical 
respondents may reflexively give 
the number of hours they’re 
scheduled to work. By contrast, 
Mr. Robinson's data come from 
detailed “time diaries” that force 
people to account for 24 hours. 

In 1840 Alexis de Tocquevihe 
wrote in "Democracy in Amer- 
ica’ 1 that tiie American ‘ ‘is always 
in a hurry. ... Besides the good 
things that he possesses, he every 
instant fancies a thousand others 
that death will prevent him from 
trying if he does not ny them soon. 
This thought fills him with anxi- 
ety. fear and regreL * * 

Sound familiar? Even retirees 
and college students — two 
groups that have more free time 
than most — regularly report 
themselves rushed, says Mr. God- 
bey. Time is inevitably scarce if 
you always fear you're missing 
something. TV is a constant dis- 
traction; it takes about 15 hours a 
week. While some technologies 
save time, they don’t depress 
stress. The advance in household 
technology helped millions of 
housewives and mothers take pay- 
ing jobs. The result is that the two- 
earner couple — especially the 
couple with children — is now 
ground zero in the time famine. 

Belonging to this class, I sym- 
pathize with its complaints- We 
feel overwhelmed. But we forget 
a few things. We're a distinct (if 
large) minority: only 1 8 percent of 
households. And our problem is 
less scarce time than competing 
ambitions. It’s hard to serve mul- 
tiple masters: to be an attentive 
parent and a successful careerist 

We say we seek repose, but 
even our recreations are often 
frantic efforts to outdo each other 
in fun, adventure and experiences. 
All the striving, comparing and 
competing infuse America with 
its vitality and. at tbe same time, 
create what may be our largest 
national deficit: peace of mind. 

Washington Post Writers Croup. 


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A Global Competition for Tomorrow’s Leaders 

World Business Council 
for Sustainable Development 

Today, on UN Environment Day, top business 


Internet, the Sustainable Business Challenge 
Exam. This Internet competition will determine 
who is best suited to run tomorrow’s 

The Sustainable Business Challenge Exam has been 
developed by the WBCSD in partnership with 
AIESEC, the world’s largest student organization, 
and the United Nations Environment Program 
(UNEP). This unique initiative is being launched to 
test how much students know about the environment 
and corporate social responsibility. It is a multiple- 
choice e xamina tion for those who want to show to 
future employers that they know the business basics 
about sustainable development — or for those who 
just want to test their own skills and understanding 
about environmental issues. 

• What does it take to pass the Sustainable Business 

Challenge Exam? You need to know about eco- 
efficiency, design for environment and the “green 
pre mium ” You have to explain what “closing the 
loop” means for manufacturing, and how share- 
holder value is linked to environmental perfor- 
mance. If you can provide correct answers to these 
and most of tfie 50 other questions, you will have 
passed the exam and 
demonstrated that you 
have the potential to be- 
come a business leader to- 

these issues have become standard items ofbusiness 
strategies and plans, and companies that continue to 
ignore sustainable development will simply lose 
their license to operate. 

The next generation ofbusiness leaders 
This is why the WBCSD wants to challenge students 
in finance, economics 


Boardroom to classroom 
What exactly does the 
sustainability challenge 
mean for future business 

careers? How well are 

students prepared to meet 

the recruitment requirements of corporations? Sur- 
veys indicate that today's students, the leaders of 
tomorrow, have a poor understanding of environ- 
mental facts, and some business students even be- 
lieve that showing an interest in the environment 
may harm rather than help their chances of finding a 
good job. Tbe truth of the matter is that the most 
profitable companies around the world are those that 
have made the environment part of their business 

Indeed, companies are integrating environmental 
and sustainable development priorities into their 
core business activities, and they expect those they 
recruit to be aware of these issues. Two decades ago, 
only a few pioneering companies were discussing 
environmental issues in their boardrooms. Today, 

"The WBCSD ’s Sustainable Business Challenge 
initiative is a reminder to us all that the sus- 
tainability agenda is developingfaster than almost 
any other part of the business agenda — and that 
the relevant understanding and skills are likely to 
be necessary conditions of success in the 21st 
century business world. ” 

Livio D. DeSimone 
Chairman and CEO, 3M 
Chairman, World Business Council 
for Sustainable Development 

and business to prove 
they have tbe leadership 
and business vision the 
corporate world needs. 
Until now, environmen- 
tal education has focused 
mostly on environmental 
management but has not 
succeeded in providing 

busy students with the 

minimum knowledge 
they need: a road map explaining the key trends and 
forces emerging in the global environment, as well 
as the ability to anticipate them. 

Today, the WBCSD intends to raise the envi- 
ronmental literacy of 1 million potential business 
leaders worldwide and show them how this will 
benefit their future careers. By logging in now at 
http^/, you can help the 
council achieve this — and increase your chances of 
finding a good job. 

What Is the WBCSD? 7 

. / 122 cqrripariies from 37 coun&fes wftcr 
r^bare.a cbrgmftrnent to sustainable cfevetopro^t^' 
■_7t».3ftKJS0_.ateo benefits from a global network' 
; leered fa ifevetop&rig countries and countries jh 
■'.firs^sltioiu It : beffeyes training and : education are. 
essential iR' faising awareness of sustainable de*. ’ 
NpRl£f, athreeyear projectrun 
of ; \^©CSO’S'$cancfeiaMan members, aims at train* 
irjg600 f^ssianmaftE^is. The m&atwe-indude&. 
..'mtomshijjs and workshops with the. sponsoring 
,'ctHpq rlab^ msffiagenidrit 

World Business Council for Sustainable Development 
160 route de Florissant 
CH-123I Conches, Geneva, Switzerland 
Tel.: (41 22) 839 3100 - Fax: (41 22) 839 3131 
E-mail: info@wbcsd.cb 
WWW: www. wbesdeh 

The Challenge 

The Sustainable Business Challenge Exam will be 
available on the Internet until December 1997 at 

To help students take this exam, the WBCSD has 
developed a guide, the Sustainable Business Chal- 
lenge Brief, designed as a series of briefing doc- 
uments for a corporate board meeting in the year 
2017. It was developed together with corporate en- 
vironmental staff, students, professors and environ- 
mental experts, in partnership with UNEP. The Brief is 
on the Internet and will later be in paperback. 

Students who pass the exam will receive a WBCSD 
Sustainable Business Challenge Certificate, and the 
top five students will be invited to the WBCSD Council 
Meeting in November 1997 in Prague. The WBCSD 
encourages all students to mention this certificate 
when applying for a job at one of its 122 member 
companies. For more information about this initiative, 
contact JarvOlaf Willums at the WBCSD (tel.: 41 22 
839 3150, fax: 41 22 839 31311, or the WBCSD's 
Foundation for Business and Sustainable Develop- 
ment In Norway (tel.: 47 67 58 18 00. fax: 47 67 58 
18 75, email: 

WBCSD Member Companies 

3M - ABB Asea Brown Boveri * Akzo 
Kobe! • Anova Holding * Aracruz Ce- 
kdose • Assurances G£n£rales de France * 
AT&T - Avenor • Axel Johnson Group - 
Bank Umum Nasional • BEWAC • The 
BOC Group -BG-The British Petroleum 
Company * The Broken Hill Proprietary 
.Company Limited * Caerai Mineza^ao e 
tahggifl • Cargill • Chemical Works 
5L 'Sokolov - CH2M Hill • China Petro- 
^.Chemical Corp ora t io n (SINOPEC) • Clif- 
ford Chance -COGEMA * Coots Brew- 
ag Company - DAN Hotels Corporation 

• Danfoss • De Lima & Cia • Deloitte 
Touche Tobmatsu International * The 
Dow Chemical Company • DuPont • 
Eastman Kodak Company ■ EBARA 
Corporation • The Environmental Re- 
sources Management Group * ESKOM • 
FAJLCK. Group - Fiat Auto • Fletcher 
Challenge * Fundacion Juan March • 
GarovagHo y Zonaqtrin, * General Motors 

- Geriing-Konzem Insurances • Glaxo 
Wellcome • Grupo IMSA ■ Heineken ■ 
Hemz-Wattie • Henkel • Hitachi * Hoechst 

- F. Hoffinann-U Roche • Imperial 

Chemical Industries * Indonesian Forest 
Community • Interface • International Pa- 
per Company • Inti Katya Persada Tehnik 
• Itochu Corporation • John Laing * John- 
son & Johnson • Johnson Matthey • 
Kajima Corporation • The Kansai Electric 
Power Company • Kfldkoman Corpora- 
tion • Kvaemer * Lafarge • LG Group • 
Mitsubishi Corporation * Mitsubishi 
Electric Coiporation - Monsanto • Na- 
tional Westminster Bank ■ NEC Cor- 
poration • Neste • Nestle ■ Nippon Tele- 
graph and Telephone Corporation * 

Noranda » Norsk Hydro ■ Novartis • Novo 
Nordisk * Ontario Hydro • Philips Elec- 
tronics • Pirelli • Pliva • PowerGen • Tbe 
Procter & Gamble Company • RAO 
Gazprom • Rhftae-Poulenc • Rio Does 
International • RTZ-CRA • Saga Pet- 
roleum • Samsung Electronics • S.C. 
Johnson & Son • Scudder, Stevens & 
Clark ■ Seiko Group ■ SGS Soci&e G6n- 
6rale de Surveillance Holding • SGS- 
THOMSON Microelectronics • Shell In- 
ternational • SHV Holdings • Skanska ■ 
Sonae Investimentos - Sony Coiporation ■ 

SOPORCEL • Staloil * Stora • Storebrand 
• Sulzer • Swiss Bank Corporation ■ 
Taiwan Cement Coiporation • Texaco • 
Thai Farmers Bank • The Tokyo Electric 
Power Company • Toshiba Coiporation • 
Toyota Motor Coiporation • TransAlta 
Coiporation • Unilever • UPM-Kymmene 
Coiporation • Vattenfall • \folkswagen » 
Waste Management International • West- 
vaco Corporation • Weyerhaeuser * White 
Martins * WMC • Xerox Corporation • 
The Yasuda Fire & Marine Insurance 
Company • Zurich Insurance Group 


CAGE 10 



Germany’s Social Crisis Pits 


By Alan Cowell 

Nm Yorit Times Serna 

BONN — Timm Gossing is about to 
start his first full-time job, writing tour- 
ism brochures about towns in Eastern 
Germany. And already, he feels certain 
that he will not be shepherded down 
life’s byways in quite the same way as 
his forebears. 

Though the prospect seems distant, he 
doubts that his retirement years will be 
underwritten with the sort of generous 
state pensions available to his parents’ 
generation. More immediately, he be- 
lieves that his first paycheck will leave 
little for luxuries after the government 
deducts its share of pension and social- 
welfare contributions. 

“We are living our (he modernization 
of Germany," Mr. Gossing, 27, said in 
an interview in Berlin. “And it’s going 
the American way. people will have to 
work harderfor less money. The security 
that they bad in the past just won’t be 

Mr. Gossing is describing a squeeze 
that many o titer Europeans migh t rec- 
ognize. It is the common assumption that 
the guarantees of the welfare state need 
to be reined in if future generations are to 

inherit a healthy economy. But the bur- 
den will fell heavily on the young adults 
of today, and they can reject it at the 
polls. That choice is playing out all 
across Europe these days, and it helped 
to bring down the conservatives in the 
parliamentary elections in France last 

In Germany, these problems have a 
special force. A vivid illustration is what 
could happen to the country’s pension 

Just as Germany’s leaders are con- 
cluding that they can no longer afford the 
pensions and other benefits that a pre- 
vious generation took for granted, the 
country is laboring under the costly bur- 
dens of reunification and pressure for 
greater austerity to achieve Chancellor 
Helmut Kohl’s cherished dream of a 
single strong European currency. 

Mr. Gossing is altering Germany’s 
work force of 40 mtUioo people at a 
critical moment: unemployment is stub- 
bornly hi g h ; the government talks in- 
creasingly of paring benefits, and two 
generations have become rivals for the 
substantial leftovers of Germany’s 

The conflict taking shape is between 
the retirees, who worked long hours for 

Germany’s economic miracle of the 
19308 and 1960s, and the 20- and 30- 
somethings who increasingly are being 
called on to finance that generation’s 

“This is the looming problem,’’ said 
an official of the Education Ministry in 
Bonn, who spoke on the condition of 
anonymity. “We are not talking left- 
right as tiie basic social division, but 

Indeed, for the young, the newspaper 
Die Woche said recently, “die prospect 
of lower pensions atthe end of a wanting 
life marked by higher contributions is 
causing many young employees to doubt 
the validity and justice of the system.’ ’ 

The reason for such prognostications 
is that, under a system dating back to 
Bismarck and the original German uni- 
fication, in 1871, pensions paid out 
today are financed by the paychecks of 
people like Mr. Gossing, whose late 
entry into the job market is not unusual 
for German college graduates. 

The system means that, as people of 
his a gg pay pension w ithh oldings, the 
money is not pot aside to grow f or future 
pensions, but is used to pay the needs of 
those now retiring. In other words, some 
Ge rmans say, the old exploit the young. 

Additionally, as German society ages 
and birthrates dwindle, more and more 
old people will be looking to a shrinking 
youhger generation to support them, 
meaning that either, fee old could get 
smaller pensions or the young may have 
to pay more to support ' them. 

The American Social Security system 

ion of The American Social Security system 

g left- is somewhat similar, in that current 
m, but workers pay much of the costs of ben- 
efits for retirees, but the benefits are not 
spaper as generous as Germany’s and the demo- 
■ospect graphic disparities are far less severe, 
anting In Gennany. the young seem oddly 
ions is disadvantaged. While Germany’s 16 
>donbt million pensioner are not organized in 
Em." the same powerful lobby as are :the 35 
rations million retirees in the United States, they 
ack to are among the nation’s most consden- 
in uni- tkras voters, 'meaning that political 
id oat parties court them. By 2030, the gov- 
seks of eminent forecasts, more than a third of 
>e late tbepopulation will be over 60. 
nusual One idea for addressing these prob- 
lems was gradually to increase the re- 
iple of tirement age for women to 65 years from 
gs, the 60, and for men to 65 years, hum 63. 
future That proposal became law last year, 
teds of Another, suggestion this year drew 

. some howls of protest by suggesting higher 
young, taxes on r etiree s. At present, retirees 

qualify -for. state pensions worth 70 per- 
cent of fee salaries they earned in their 
final years at work. The government’s 
idea is to Reduce that to 64 percent.. 

Germany’s pensions system, looked 
litre a winner in. Bismarck's day, Mr. 
Kohl is fond of saying. Life expectancy 
far moSt Germans then was 4>years cff 
less, whifevthe retirement age was 65. 

Thesedays. people often five well into 
their 70s and S&.young people postpone 
their entry into fee work force as long as 
possible, and many people tty to retire, at 
a younger age under the lucrative plans 
offered by sane employers. 

Even then, fee system might work if 
Germans had large familiesto feed into 
ft. But, particularly in Eastern Germany, 
they do not Along with Italy and Spain, 
Germany has long had one of fee lowest 
birfe rates in Eurt^e. According to Euro- 
pean Union figures, there are a statistical 
1.26 children in fee median-sized Ger- 
man famil y 

The problem is embedded in a broader 
question bedeviling the Gomans as they 
reach what Ingeborg Afldhn, a. retired 
musicologist and part-time journalist, 
refers to as a “change of epoch.” 

' “The problems are so big in this so- 
ciety feat it cannot go on tike tins for 

General to Lead Israel’s Labor Party 

Ehud Barak’s Tough Image Seen as Counteiforce to Netanyahu 

By Barton Gellman 

Washington Post Service 

JERUSALEM — A year after - Israeli 
voters drove it from power, the Labor 
Party bid anew for the prime minis- 
tership Wednesday by anointing Ehud 
Barak, a tough-minded general, as its 
standard-bearer in elections by 2000. 

On his way to victory, he nudged 
aside former Prime Minis ter Shimon 
Peres, who had sought to delay die suc- 
cession and to retain a modicum of 
power with a newly created post of party 
president The latest of many sad mo- 
ments for Mr. Peres lately came when be 
showed up to vote without his identity 
card. He had to ask for special dis- 
pensation to cast a ballot 

Mr. Barak defeated three other can- 
didates, winning 51 percent of the vote. 
He defeated Yossi Beilin, Shlomo Ben 
Ami and Ephraim Sneh. 

Consciously styling hims elf after 
Yitzhak Rabin, the slain Labor prime 
minist er who also came to public life 
from fee nation’s senior military post, 
Mr. Barak centered his campaign cm the 
argument that no one else could bring 
Labor back from exile. “Only with 
Barak will we win,” a rhyming slogan in 
Hebrew, appeared on every Barak poster 
and on tens of thousands of bumper 
stickers and buttons. 

There was more than a passing re- 
semblance in that to fee campaign of 
“electability” that brought Prime Min- 
ister Benjamin Netanyahu to fee Likud 
Party chairmanship four years ago. Both 
men assumed their positions as out- 
siders, succeeding much older leaders — 
Mr. Peres is 73, and Likud's Yitzhak 
Shamir was then 76 — who had just been 
turned out of office in general elections. 

Mr. Barak’s ideological critics on fee 
left, coining a term of derogation from 

Mr. Netanyahu’s nickname, describe 
Mr. Barak as “Bibi-compatible" in oth- 
er respects. As a freshman member of 
Parliament, Mr. Barak voted against Mr. 
Rabin’s last major agreement wife the 
Palestinians, in September 1995, and he 

Likud hawk Ariel Sharon of January’s 
agreement on an Israeli troop pullback 
from the West Bank city of Hebron. 

For most party members, that was not 
the point Under Israel’s new system of 
direct election. Labor needs a candidate 
who can go head-to-head wife Mr. Net- 
anyahu and withstand the Likud leader’s 
stinging accusations of softness on ter- 

Mr. Netanyahu skillfully harnessed 
voters’ fears that Mr. Peres lacked the 
strength to defend. Israel’s interests 
against Arab enemies while pursuing 
peace. Mr. Peres, who never served in 
uniform, suffered in this argument by fee 
aura of expertise Mr. Netanyahu brought 
as a former soldier in the Sayeret Maikai, 
Israel’s anti-terrorist army unit Mr. 
Barak was Mr. Netanyahu’s commander 
in the Sayeret MafkaL 

Short ami compact, Mr. Barak is the 
subject of storied exploits as a soldier. In 
April 1973, he donneda wig and women’s 
clothing to infiltrate Beirut and help gun 
down Mo hamme d Najjar, a sonar leader 
of the Black Se ptember unit bad 
earned out a number of terrorist attacks. 

Mr. Barak, in his campaign and in his 
triumphant appearance alter midnight at 
his Ramat Gan headquarters, did not em- 
phasize peace. “This is fee first step of 
hope, the first step of renewal, the first 
step to fee victory which will lead us back 
to government, ” he said. He appropriated 
a slogan from tire Likud-led coalition of 
rightist parties, calling Labor and its allies 
“fee true ’national camp’.” 

Scarred by decades of infighting be- 

tween Mr. Rabin and Mr. Peres, whose 
bitter rivalry absorbed much of tire 
party’s energies, Labor activists were 
relieved to see a clean and even bland 
contest for leadership this time. 

Bnt if fee prevailing political wisdom 
is right, his party is in for some un- 
pleasant surprises. Nahum Bamea, a 
columnist writing in tire newspaper Ye- 
dioth Aharonoth, noted that Mr. Net- 
anyahu rode to power on a coalition of 
fee disaffected — ultra- Orthodox Jews, 
religious nationalism and a majority of 
Jews of Middle Eastern and North Af- 
rican descent and recent immigrants 
from former Soviet republics. 

This coalition, still a clear majority of 
Israeli voters, is “united by hostility' to 
the old T ab or- dptninated Israel and nfy? 
to Arabs,” Mr. Bamea wrote. The new 
Labor leader “will need to toss aside fee 
party which elected him, just as Tony 
Blair did in Britain.” 

■ Cabinet Gets Peace Plan 

Prime Minister Netanyahu presented 
his outline of a permanent peace agree- 
ment with fee Palestinians to his cabinet 
for the first time Wednesday and re- 
portedly said Israel most retain large 
chunks of the West Bank, The Asso- 
ciated Press reparteti’from Jerusalem. 

Mr. Netanyahu told the ministers he 
did not want to sketch maps yet, ac- 
cording to Israel Army Radio. 

Last week, the newspaper Ha’aretz 
published a map it said represented Mr. 
Netanyahu’s view of a permanent peace 
agreement, wife less than 40 percent of 
fee West Bank in Palestinian control 

Mr. Netanyahu reportedly told the 
cabinet on Wednesday that Israel would 
seek to retain control over Jewish set- 
tlements ringing Jerusalem, over fee 
Jordan Valley and over major settlement 
clusters in fee West Bank. 

LmiDM/Aftirv hnu IVi 

Ehud Barak at the grave of Yitzhak Rabin in Jerusalem on Wednesday. 

KOREA: Student Riots in Seoul Over Corruption Wkoken Government at a Delicate Time in Foreign Relations 

Continued from Page 1 

seeking a second five-year term in 
December’s election. A group of hope- 
fuls. called the “nine dragons," are 
jockeying to win fee presidential nom- 
ination of Mr. Kim’s New Korea Party. 
Analysts say all the scandals may reduce 
the contest to fee basic issue: Who can 
best lead fee party away from fee specter 
of sleaze? 

Democracy is still maturing in South 
Korea, where Mr. Kim is the first freely 
elected nonmilitary leader In more than 
30 years. 

Optimists view the money scandals as 
proof of two democratic advances: in- 

creasingly free news media, which have 
educated fee public about the amazing 
suras of cash flowing through politics, 
and a more independent court system, 
which has broken away from the op- 
pressive control of fee Blue House, as 
fee president's office is called. 

Even a few years ago, it seemed un- 
imaginable that the president’s family 
could be investigated. But last month, 
fee president’s son. Kim Hyun Chid, was 
jailed on bribery and tax-evasion 
charges amid allegations that he had 
laundered millions of dollars in dubious 
“donations” from business leaders via 
about 100 bank accounts. 

As tiie president’s sou. who also 

served as his father's adviser and cam- 
paign manager, sits in jail, many say a 
power vacuum has paralyzed the coun- 
try. And they say such a paralysis is 
dangerous, with North Korea short on 
food for its hungiy people and long on 
missiles and firepower. 

“Every country in the world has cor- 
ruption, but our government has ground 
to a halt,” said Choi Young So, a sales- 
man who expressed fee concern many 
feeL “We have an economic crisis. Sup- 
pore we had a military threat from Norm 

“The president seems to have lost his 
ability to steer the government,” said 
Parit Jai Chang, professor of public ad- 

ministration at Sookmyong University in 
Seoul “The government is in chaos.” 

Many people euphemistically call 
bribes gifts. They are so much a part of 
the culture that Moon Chung In, a polit- 
ical science professor at Yoasei Uni- 
versity, said mat in some cases they were 
the ‘ ‘shadow price’ ’ of doing business in 
South Korea. 

Parents sometimes give money to 
scboolteachers with the understanding 
that it means the teacher will pay extra 
attention to their child. Politicians dole 
out cash at weddings and wakes, even if 
they do not know the person, because it 
is expected of them. Salesmen routinely 
close deals wife big customers by slip- 

ping them an envelope foil of money. 

Even so, the public has been shocked 
by the scale and scope of political slush 
funds. This year’s trial involving Hanbo 
Iron & Steel Co., a conglomerate that 
employs 25,000 people, mesmerized the 
country as ft learned how a business ty- 
coon had slipped millions to lawmakers. 

As the extent oftbe corruption becomes 
more fully known, public dismay turns to 
anger. People now realize in excruciating 
detail that their taxes and jobs are affected 
by sleazy alliances between government 
and business. Every day, 53 businesses go 
bankrupt here, the highest level of failures 
since 1982, and many people are blaming 
the government. 

ALGERIA: On Eve of Poll, Jitters See a Glimmer of Hope 

Thf ft— rtac dlVm 

Algiers residents watching security forces around the body of a terrorist suspect. 

Continued from Page 1 

immediate result, but I think that 
over the long term, civil society will 
benefit,” sard Jean Lavoie, a Ca- 
nadian consultant to the Washing- 
ton-based National Democratic In- 
stitute, which organized fee U.S. 
observer team. “Every time you give 
people a window of opportunity to 
express their views,” he said, “it 
gives the people some oxygen.” 

After decades of one-party mil- 
itary-backed rule that followed in- 
dependence from France in 1962, 
Algeria experienced a brief period of 
political openness that began in 
1989. But feat window slammed shut 
in January 1992, when the govern- 
ment canceled elections rather than 

permit a victory by the Is lamic Sal- 
vation Front, which tapped into 
widespread public anger at corrup- 
tion, acute housing shortages and 30 
percent unemployment. 

The decision to cancel fee elec- 
tions, ban the Islamic Salvation Front 
and jail its leaders posed a quandary 
for Washington and other Western 
capitals, which have struggled to find 
a middle ground between their pro- 
fessed support for democracy and 
fears of an Mamie fimHatwffnfalig t 
regime in the strategically important 
region. Algeria is a major producer 
of oil and gas and southern European 
countries fear a tide of refugees if 
stability is not restored 

Tbe government has taken halting 
steps to restore some of its legit- 

imacy. Mr: Zeroual stood forelection 
in 1995 and won a strong victory 
amid high voter turnout that was in- 
terpreted by many analysts as a sign 
that Algerians were sick of fee vi- 
olence and willing to turn their backs 
cm the Islamic Salvation Front. 

Last November, however. Algeria 
seemed to take a step back from 
democracy wife the approval in a 
national plebiscite of a new con- 
stitution that bans political parties 
based on religion and ethnic identity 
and sharply limits fee jpowere of the 
National Assembly.- 'Hie new con- 
stitution created a new upper house, 
one third of whose members will be 
appointed by Mr. Zeroual, giving 
him effective veto power over any 
parliamentary decision. 

RUSSIA: Killings Reflect an Army in Despair NATO: French Military Re-entry Doubtful After Elections 

Continued from Page 1 

occasionally cited as the im- 
mediate cause for the shoot- 
ing rampages. The military 
prosecutor’s office has said 
that more than 1 ,000 Russian 
soldiers were killed last year 
under a wide variety of cir- 
cumstances, including haz- 
ing, and that more than 500 
committed suicide. Many 
m ore were beaten so badly 
they were hospitalized. 

“Two thousand soldiers 
come to us after being beaten 

and having deserted every 
year,” said Lyubov Mel- 
nikova, spokeswoman for fee 
Committee of Soldiers’ 
Mothers. “In the best cases, 
they run. In the worst cases, 
they kill themselves or kill 
fellow servicemen." 

The most recent in c id e nt, 
at dawn Sunday, was also fee 

A sergeant at a military 
base in Abkhazia, a break- 
away region of Georgia, shot 
and killed 10 of his fellow 
servicemen while they slept. 

wounded three others and 
then killed himself. 

Russian television carried 
a spotty report that suggested 
the sergeant’s mother was an 
alcoholic who may have 
somehow embarrassed him 
during a visit to fee base. No 
official exp lanatio n was 
offered and the authorities 
said only that an investigation 
was under way. 

General Shatalov, the 
aimed forces spokesman, said 
“a veiy deep analysis” of the 
event was being carried out 

Continued from Page 1 

sible compromises with the French. 

Discussions are still going on in 
advance of a NATO summit in Mad- 
rid early next month feat will decide 
which central European countries to 
invite to join the Alliance. 

But U.S. and French officials say 
that most of fee possible compro- 
mises on the Naples command have 
been explored without agreement. . 

Hie French president has a key 
constitutional voice in defense is- 
sues, regardless of who controls the 
government. Now that the Socialists, 

supported by tbe French Cotnmu- ' 
nists, are in charge, it is hand for 
officials and defense experts here to 
envisage Mr. Chirac’s flouting their 
opposition to closer links wife 

“In view of the Socialist victory, it 
seems unlikely feat France will de- 
cide in the immediate future to re- 
integrate into the NATO military 
structure,” said Professor David 
Yost, a senior fellow at the U.S. 
Institute of Peace in Washington. 

“Ever since 1995, fee Socialists 
have argued feat not enough has been 
obtained from fee Americans to jus- 

tify reintegration,” Mr. Yost said. 

The French and most of fee other 
European allies have also not. yet 
reached consensus wife the United 
States over which .countries should 
be invited next month to join 
NATO. ' 

Almost all of them agree that Po- 
land, fee Czech Republic- and Hun- 
gary should be among them, but 
France is pushing for Romania to be 
included and supports Italy and other . 
countries on bringing Slovenia in 
with fee first wave as welL Mr. 
Jospin supports expansion and wants 
Romania to be invited to join- . 

long,” she said in an interview. 

■ The uncertainty is perceived differ- 
ently by East Germans and West Ger- 
mans, divided still by what some call a 
spiritual and mental version of the Berlin 
wall. For East Germans, fee challenges 
to Germany’s welfare state, which anse 
from global economic pressures and the 
dictates of European economic integra-. 
tion, come as a second rude shock after, 
reunification seven years ago confronted 
them with a society that many see as. 
offering for less security than commun- 
ism. The. old East Germany, Mrs. Aiiihn 
said, was 14 a cozy, warm, very com-, 
fortable place for people who wanted to, 
exist with a; minimum of effort.” 

Ramification has been costly for 
West Germans, not least because they 
took over fee pensions obligations of fee 
bankrupt East. 

For West Germans looking for a scape- 
goat; fee easiest targets are people per- 
ceived to be milking fee system without 
paying their dues — predominantly East 
Gomans and ethnic Germans from the 
former Soviet Union, milli ons of whom 
qualify for state pensions paid in hard 
Deutsche marks, even though they paid in’ 
pension contributions in now-worthless 
rubles and East Goman marks. 


Pact in Germany 

Continued from Page 1 

worth imitating.” Germany’s other big! 
unions greeted the agreement with cau- 
tion. LG. Metal, the nation’s biggest,; 
declined to issue any comment. 

The contract is not without precedent 
Germany's giant metalworkers’ onion,, 
LG. Metal, approved a similar clause* 
several years ago for chemical compa- 
nies in fee former East Germany. And 
the union has also agreed to a provision; 
feat would allow west German compa-i 
nies to negotiate for a reduction in the 
number of paid hours in a standard work- 
week. • 

But labor experts said the chemical., 
pact goes much further than any pre- : 
vious deal between industry and unions,! 
because it opens the way toward greater 
flexibility in west Germany, which is; 
more prosperous and more resistant to 

communist states oF east Germany . 

Beyond that, they said, it appears to 
give more control to local onion coun- 
cils, often more sympathetic to pleas 
from companies than the national un- 
ions. i 

“It is a big step toward decentral-, 
ization of the collective bargaining pro- 
cess.” said Peter Geist, a labor policy 
analyst at fee Organization for Economic 
Cooperation and Development in Paris. 

More, than ever before, unions across 
Europe are underpressure to give compa- 
nies more freedom in their ability to hire, 
fire and assign people to new jobs. 

With the exception of Britain, the 
Netherlands and a handful of other na- 
tions, most countries in Europe have 
become bogged down in high unem- 
ployment that industry routinely attrib- 
utes to the rigidity of the workplace^ 
Because it is extremely difficult and 
expensive to lay off workers industry 
executives have complained that the 
mere act of hiring a fulltime employee 
has become a risky proposition. 

The chemical industry, one of Ger- 
many’s most important industrial sec- 
tors, has lost about 60,000 jobs since 
1993, union officials say, and fee out- 
look, at least within Germany's borders, 
remains gloomy. 

Labor exppts said that 1. G. Cbexnie, the 
chemical union, has already been among 
fee most innovative and flexible unions in 
Germany. Rudolf Heim, a spokesman for 
the union, said its overriding goal was to 
preserve jobs and to reach solutions in 
conjunction wife companies that are in 
severe financial straits. 

The agreement does not allow compa- 
nies to unilaterally declare they need 
more money and then to cut wages. A 
company would have to open its books 
to union representatives and demon- 
strate that workers would be in severe 
jeopardy of losing their jobs without a 
wage reduction. Companies also would 
win a right to re-adjust work hours. 

Kabila Accuses 
France of Ar ming 
Mobutu Loyalists 


KINSHASA, Congo — President 
Laurent Kabila's government ac- 
cused France on Wednesday of 
providing arms to s u pport e rs of fee 
ousted dictator Mobutu Sese Seko to 
destabilize fee country. 

France, a longtime supporter of 
Marshal Mobutu, who held sway 
Oyer Africa's tinni-largest nation 
for over three decades, dismissed 
the allegation. 

A French Embassy official said, 
“Since this conflict began, we have 
.not provided any weaponry to Zaire, 
in compliance with fee European 
Union arms embargo, and we are 
not about to start now.” 

Ranee, fee United States, Britain, 
Belgium and Portugal deployed . 
troops in Congo Republic, a framer 
French colony, daring die final 
weeks of fee seven-month civil war . 
that brought Mr. Kabila to power in 
fee former Zaire in May. 

The aim was to evacuate foreign 
nationals from neighboring Kinshasa 
in the event of serious bloodshed, but , 
the need did not arise. Some French 
troops have stayed on in anticipation 
of next month's presidential elec- ! 
tions in Congo Republic. 

Ognamy Maurice, Congo Repub- . 
tic’s ambassador to Kinshasa, also ‘ 
denied feat his country would, per- . 
mit any such traffic in arms. 


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- s Mtibiiin l-"' 111 '" 1 

By Jane E. Brody 

r New Yurk Times Service 

EW YORK — Can one diet 
help prevent heart disease, 
cancer, high blood pressure, 
obesity and diabetes? And 
will people eat it, enjoy it and leave the 
' table satisfied? The answer increasingly 
' appears to be yes. 

This “miracle” diet is available now 
m the grocery store. It is relatively low in 
fat deriving less than 30 percent of daily 
calories from fat bur loaded with fruits 
and vegetables (eight to 10 servings a 
day) and grains ( seven to eight servings). 
U also contains two to three daily 
servings of low-fat or nonfat dairy 
products bui only modest amounts of 
lean meat, poultry and fish (two or fewer 
three-ounce cooked servings a day) and 
dried beans, nuts and seeds (four to five 
4 servings a week). No exotic foods, no 
supplements, no herbal concoctions. 

And, unless most of your meals are 
from coffee shops and fast-food res- 
taurants, it is not as challenging to live on 

the diet as many people think. In the 
most recent demonstration of its ben- 
efits, a study financed mainly by the 
National Heart, Lung mid Blood Insti- 
tute, 459 men and women with mild 
hypertension or borderline high-normal 
blood pressure lived on just such a diet 
for right weeks. 

No changes were made in how much 
salt they consumed (three grams of so- 
dium a day, which is about the national 
average) or alcohol they drank or phys- 
ical activity they undertook. In addition, 
their caloric intake was adjusted to keep 
foeii weight stable, even if they were 
overweight They took no pressure- 
lowering dregs or vitamin- min eral sup- 

Even though participants did not lose 
weight, reduce salt and alcohol intake or 
exercise more — the usual prescription 
for controlling mild hypertension — 
their blood pressures dropped signif- 
icantly, as much as might be expected if 
they had taken medication. The drop 
occurred wi thin two weeks of starting 
the diet and persisted throughout. 

Ull w A "* n *-tr l 

Christine Harris, graduate student researcher and the “tickle machine ." 

, What’s So Funny? 
Tracing the Tickle 

By Carol Kaesuk Yoon 

’’ iVor York Tunes Service 

EW YORK — It is an en- 
during mystery pondered 
over the ages by such lu- 
minaries as Socrates, Galileo 
and Darwin, as well as by many a 
preschooler Why do people laugh when 
they are lickled :> Yet tickling has re- 
mained little more than a cackle-filled 

' Now a handful of researchers are 
approaching the subject cautiously and 
with due scientific gravity, shedding 
right mi why people cannot tickle them- 
selves and why humans evolved to 
laugh at all. Aimed with such unlikely 
tools as “tickle machines” and video- 
tapes of “Saturday Night Live.” the 
scientists are finding that ticklish 
laoghrer is not the happy phenomenon 
that many have assumed it to be. 

Christine Harris, a graduate student at 
the University of California at San 
Diego, one of the few researchers in the 
field, said, “It’s actually quite bizarre 
that someone rubbing their fingers up 
and down your sides or foot makes you 
laugh.’ * She and Dr. Nicholas Christen- 
feld at the university in San Diego are 
the authors of two new studies, the first 
of which was published in a recent issue 
of the journal Cognition and Emotion. 

Dr. Alan Fridlund, a tickle researcher 
who is a psychologist at the University 
of California at Santa Barbara, said, 
“This is uncharted territory.” 

In the late 1800s Charles Darwin and 
Ewald Hecker, a German physiologist, 
began some of the first detailed the- 
prizing about tickling, their combined 
Speculation, now known as the Darwin- 
Hecker hypothesis, suggesting that hu- 
mor and tickling share deep underlying 
similarities. Both produce laughter, 
goose bumps, convulsive muscle con- 
tractions and both, they suggested, ap- 
pear to require a pleasant state of mind. 

; To tcsl the hypothesis. Ms. Harris and 
Dr. Christen fold enlisted 72 undergradu- 
ates at their university. The basis for the 
^fudy is what is known as die warm-up 
effect, the scientific underpinnings for 
fte phenomenon of the warm-up 
temedian. If a person finds something 
funny, researchers have previously 


JjA Issues Rules 
On HMadCow 9 Disease 

[ WASHINGTON ( WP) — The Food 
TO Drug Administration has an- 
feuoced rules intended to prevent out- 
taaksof "mad cow” disease in Amer- 
ica cattle herds. 

The agency will prohibit the use of 
Protein derived from most m a mm al s m 
taeriosy feeds given to ruminant an- 
fcak such as cows, sheep and goats, 
JJjpogb P*8 proteins will still be allowed 
rules will take effect in two 

J No cases of bovine spongiform en- 
“pfalopmhy. the scientific name for 
W disease, have ever been detected in 
^•5. bads. But the disease caused a 
food panic in Britain last year as more 
"tan 100,000 cattle were found to be 

shown, the next thing encountered will 
seem that much funnier because of an 
already giddy state. 

So one group of students was tickled 
for 10 seconds, or until the tickling 
became intolerable, and then shown 
videotapes of stand-up comedy routines 
and clips from “Saturday Night Live.” 
A second group watched the comedy 
video first and then was tickled. A con- 
trol group watched a patently unfunny 
nature video, then was tickled. 

Researchers postulated that if humor 
and tickling are related, and the warm-up 
effect applies to both, then subjects 
should laugh more when tickling follows 
humor or humor follows tickling. But 
that was not the case. Tickling, the study 
suggests, does not create a pleasurable 
feeling — just tbe appearance of one. 

In fact, in the researchers' latest, still 
unpublished study employing a so-called 
tickle machine, they round that far from 
being the jolly social interaction that 
many people had assumed it to be. tick- 
lish laughter may be a simple reflex. 

Researchers blindfolded 32 under- 
graduates and told them that a person 
and a machine would tickle them on the 
feet, each for five seconds. However, 
the tickle machine actually did nothing. 
It looked plausible, with a robotic hand 
attached to a hose, which was attached 
to a metal box, on top of which were 
control panels with lights and buttons 
and inside of which was a nebulizer, a 
noisy, vibrating machine used by asth- 
matics. But in reality, both times stu- 
dents were tickled by a person. 

VEN when students believed 
they were alone and being 
tickled by the machine, they 
smiled, laughed and wiggled 
as much as when they knew it was a 
person. Ticklish laughter, Ms. Harris 
concludes, rather than being social in- 
teraction, appears to be a rrflex. much 
the same as me one a doctor elicits from 
a patient’s knee with a rubber hammer. 

But if tickling is indeed a reflex, that 
raises an even more perplexing ques- 
tion: Why can’t people tickle them- 
selves? Ms. Harris suggests that it may 
be the same reason that people cannot 
startle themselves. What is missing is 
the element of surprise. 

infected and had to be destroyed. The 
disease spread as the bodies of infected 
cows and sheep infected with a similar 
disease, scrapie, were rendered and used 
in feeds given to other cattle. 

At least 1 6 cases of a similar ailment 
in humans, known as new variant 
Creutzfeldt-Jakob disease, have been 
linked to eating infected British beef. 

Guidelines on Cloning 

WASHINGTON (WP) — A federal 
ethics commission will recommend that 
Congress legislation that would 
allow some researchers to create cloned 
human pmhr yns, but would prohibit die 
qse of those embryos to nuke cloned 
human babies, according to several 
commission members. 

As Dr. William M. Vollmer, a co- 
ordinator of the study, put it, "This 
means that people with mild hyperten- 
sion can lower their blood pressure with 
more natural means and get off drugs or 
reduce the amount of medication they 
have to take." 

Dr. Vollmer, of the Kaiser Peiman- 
enie Center for Health Research in Port- 
land, Oregon, also noted that * ‘this diet is 
consistent with the disease-preventing 
diets that have been proposed by other 
groups,” including the American Heart 
Association, the American Cancer So- 
ciety, tbe American Health Foundation 
and the National Cancer Institute. 

The new findings also suggest thar 
‘ ‘foods, not supplements, are the way to 
£o," Dr. Vollmer said in an interview. 

‘We can't tell whether the good results 
were due to calcium, low fat or less 
protein combined with lots of fruits and 
vegetables,” he said. 

But the researchers did show that a 
low-fat diet that included dairy products 
and lots of fruits and vegetables was 
more effective in lowering blood pres- 

sure than a diet rich in fruits and vege- 
tables that was not low in fat and con- 
tained few dairy products. 

Previous studies that tested the ability 
of single nutrients to reduce high blood 
pressure have yielded contradictory re- 
sults. Once again, it seems that a com- 
bination of nutrients and other beneficial 
substances found naturally in foods, 
rather than isolated vitamins or minerals, 
provides the optimal health benefit. 

Many Americans are intimidated by 
die current recommendation to eat even 
five servings a day of fruits and vege- 
tables, so it is reasonable to assume that 
increasing to eight to 10 servings will 
seem formidable to most 

UT a single serving means 
only half a cup of cooked fruit 
or vegetables, half a 
grapefruit, a medium apple or 
orange, a small banana, 6 ounces of fruit 
or vegetable juice, a quarter cup of dried 
fruit or 1 cup of raw leafy greens. 

Have fruit juice and perhaps a banana, 
berries or a wedge of melon with break- 

fast and you’re off to a good start with 
two servings. Lettuce and tomato on 
your lunch sandwich, a side order of 
slaw and an apple or grapes for dessen or 
a snack add tnree servings. A salad with 
dinner and one or two cooked vegetables 
would add four or more servings, and 
you have met the goal. 

As for the grains, one slice of bread, 
half a cup of rice, pasta or dry or cooked 
cereal each equal a serving. Now. who 
eats just half a cup of pasta or cereal or 
even one slice of bread? You are more 
likely to have a cup of cereal (two 
servings), two cups of pasta (four 
servings), two slices of bread (two more 
servings) and a New York-size bagel 
(two to three servings >, and you have 
met that goal, too. 

The dairy products are easy: one glass 
of milk in cereal, a container of yogurt, 
and an ounce and a half of low-fal or 
nonfat cheese will give you three 
servings and enough calcium to meet the 
daily recommended intake for adults. 

Here is a sample dinner menu from the 
national study, known as DASH, for 

. . . . _ . _ 'saw.:* 

Dietary Approaches to stop Hy- 
pertension: three ounces of baked 
cod, one cup of rice, one-half cup broc- 
coli. one-half cup of stewed tomatoes, a 
very small spinach salad, one small 
whole wheat dinner roll, a teaspoon of. 
margarine and half a cup of melon balls.' 
This adds up to these servings: one fish., 
three grains, four vegetables and fruits', 
and one and one-half fat. 1 

The main complaint researchers got 
about such a meal was that it was too 
much food. This means that under or- 
dinary circumstances, people might be. 
inclined to eat less and. free from the 
strictures of the study, they would prob- 
ably lose some weight. 

As for how to go about learning to eat- 
this way. start slowly, making evolu- 
tionary changes in your usual diet. Begin 
to plan meals around the carbohydrates' 
and vegetables instead of the protein-.. ; 

For desserts and snacks, think low-fal 
and low-caloric: fruit, pretzels, nuts, diet 
drinks, nonfat yogurt, perhaps a little, 
low -fat cheese and whole- grain crack- 
ers. And be moderate about alcohol. 

The Well-Kept Secret of Methadone: It Works 

By Christopher S. Wren 

Nr»' York Times Service 

I EW YORK — More than 30 
years ago. Dr. Vincent Dole, 
a metabolic specialist, and 
Dr. Marie Nyswander, a psy- 
chiatrist sought to reverse a worrisome 
rise in heroin addiction here. 

Working at the Rockefeller Institute, 
as Rockefeller University was then 
called, tbe researchers sought to block 
the craving for heroin by substituting an 
opioid painkiller developed by German 
chemists during World War IL 
More than three decades later, tbe 
synthetic analgesic they first tested in 
1964, methadone, is accepted as the 
closest thing to a heroin cure. About 
1 15,000 Americans take it regularly. 

Yet by various estimates, only 5 per- 
cent to 20 percent of such users stay on 
itformarcthan 10 years. Some find they 
no Longer want the medication. Others 
relapse into drag use. Many are put off 
by the cumbersome, often petty bu- 
reaucracy that administers methadone; 
misleading rumors that methadone is 
ruinous to health; and an insidious so- 
cial stigma that, by equating methadone 
with illicit drugs, forces users to hirte the 
achievement of taking back their lives. 

"Successful methadone users are in- 
visible,” said Dr. Edwin A. Salsitz, 

director of the methadone medical 
maintenance program at Beth Israel 
Medical Center here. "Methadone is 
always judged by the failures.” 

One success story is James MaxwelL 
With his white beard and twinkling blue 
eyes, Mr. Maxwell resembles the poster 
grandpa for a bygone America. He con- 
fesses to having turned 80, brags about 
his four grandsons, and remarks, “No 
granddaughters — very disappointing.” 

As the hard-driving trumpet player 
Jimmie Maxwell, be toured with Benny 
Goodman, performed in tbe bands of 
Lionel Hampton, Duke Ellington and 
Gerry Mulligan, and worked for years as 
a studio musician on major radio and 
television shows. 

"I don’t think I missed a day of prac- 
tice in more than 60 years.” he said. 

But Mr. Maxwell has a darker story to 
telL In tbe prime of his career, heroin 
nearly killed him. He has stayed clean 
by taking methadone every day for 
nearly 32 years. 

His wife of 55 years has known, of 
course, but hardly anyone else — not his 
employers or his neighbors, or his best 
friend, a retired federal drag agent. 
"Just for reasons of my career, I didn’t 
talk about it,” he said 

In that he is hardly alone. B ecause of 
its association with heroin, those ben- 
efiting most from methadone are least 

likely to risk their careers or reputations 
by saying so. 

The stigma surrounding methadone 
was analyzed by Herman Joseph, a re- 
search sociologist who worked with Dr. 
Dole and Dr. Nyswander. Even an in- 
nocent yawn, he reported, can jeop- 
ardize a methadone user's job if the boss 
mistakes it as drowsiness induced by 
methadone rather than routine fatigue. 

Yet the extensive medical literature 
on methadone does not contain a single 
report of methadone's failing to block 
the craving for heroin. "The safely and 
efficacy of methadone in the treatment 
of narcotic addiction have been doc- 
umented more extensively than any oth- 
er medication in the pharmacopeia," 
said Dr. Robert Newman, president of 
Beth Israel Medical Center. 

EGULAR doses break the 
heroin user’s wild swings be- 
tween euphoria and with- 
drawal by stabilizing the 
level of opiates in the bloodstream. Dr. 
Nyswander 's experience with relapses 
of detoxified addicts persuaded her that 
they could not shake heroin without 
substituting a less harmful narcotic. 

“Marie was convinced that addiction 
was a disease and had to be treated with 
pharmacotherapy,” said Dr. Mary 
Jeanne Kreek. an early colleague of Dr. 

Nyswander. Dr. Kreek now heads ihe 
Laboratory of the Biology of Addictive 
Diseases at Rockefeller University. 

When the first patients were given up 
to 80 milligrams of methadone once j 
day in double-blind studies Luting ciglu 
weeks, she said, “they began turning 
away from drug administration and get- 
ting on with their lives.” 

Methadone is practical and diecnxe. 
Dr. Kreek said, becau've it can be taken 
by mouth, its effects are felt gradually 
and it wears off slowly. Half of it remains 
in the body after 24 hours. Heroin's 
euphoric rush lasts onl) minutes. Muiur 
side effects of methadone, including 
sweating, constipation and a reduced sex 
drive, tend to disappear. 

Still, methadone has its skeptics, like 
Dr. Mitchell Rosenthal, president of 
Phoenix House, whose treatment pro- 
grams strive for total abstinence. Be- 
cause many addicts abuse multiple 
drugs and have limited education and- 
job skills, he said, "they are not going to 
be chemically fixed by giving them an- 
other drug.” 

Dr. Salsitz agreed: * * Methadone can ’ r 
give you a job, or good manners or make 
you titerate." But for healing the med- 
ical symptoms of heroin addiction, he 
equates methadone with what insulin is 
for diabetics and other medicines are for 
high blood pressure. 

U.S. Hurricane Warning: More and Bigger 

By William K. Stevens 

Ne w York Tunes Service 

EW YORK — The East and 
Gulf coasts of the United 
States may be entering a 
long-anticipated, prolonged 
siege of more frequent and more de- 
structive hurricanes, forecasters say. 
They predict that this summer, more 
hurricanes than normal will develop in 
the tropical North Atlantic for the third 
straight year. 

This woald make 1995-97 the most 
active three-year period on record for 
the pinwheellng oceanic cyclones, and 
the experts say that could be only the 

The 1970s, 1980s and early 1990s 
were a time of relatively infrequent hur- 
ricanes. Those yeais did have their big 
storms: 7 of the 10 most costly hurricanes 
ever to strike the U.S. mainland did so 
over that stretch, including Hurricane 
Andrew in 1992, the costliest ever. 

But a new federal study attributes the 
trend of escalating damage over that 
period to expanding population and ex- 
ploding development rather than more 
frequent or powerful storms. 

Now the atmosphere and ocean ap- 
pear to have entered a new and more 
ominous hurricane phase. Some experts 
believe the turbulent stretch beginning 
two years ago signifies a return to the 
1940s, 1950s and 1960s, a period of 
high hurricane activity in the United 
States. If that is so, according to the new 
federal study, the cost of damage 
wrought by hurricanes — already the 
most expensive natural disasters in 
America - — could soar to new heights. 

Scientists offer varying explanations 
of what is responsible for the increase in 
hurricane frequency. One study has ■ 
found that sea-surface temperatures in 
1995 were tbe highest on record in the 
tropica] North Atlantic. That year, 19 
tropical storms and hurricanes, double 
the 1946-1995 average, formed in the 
Atlantic. The authors of the study cou- 

Under die plan, privately funded sci- 
entists or doctors could make cloned 
human embryos for research purposes 
but could not implant them into wom- 
en’s wombs. 

The much anticipated recommenda- 
tions, from the National Bioethics Ad- 
visory Commission, are an attempt to 
find common ground between those 
who find the possibility of human clon- 
ing an affront against nature and those 
who see cloning as a promising option 
for infertile couples and a possible 
source of medical advances. 

Commission members said the rec- 
ommendations were sensible, given the 
ethical complexities and tbe need for 
immediaie action. But critics, including 
antiabortion activists, complained that 
the proposed restrictions do not go far 

eluded that warmer seas encouraged in- 
cipient hurricanes to develop by infus- 
ing them with more energy. 

Coincidentally or not, 1995 also saw 
the highest average global surface tem- 
peratures on record, and some scientists 
say this raises the possibility that global 
warming is contributing to the increased 
frequency of hurricanes. The coincid- 
ence "is suggestive of some link to 
global wanning, but that needs to be 
proved,” said Dr. Mark A. Saunders, 
chief author of the study. 

Others say that global wanning is 
almost certainly not foe cause. One is Dr. 
William M. Gray, an atmospheric sci- 
entist and hurricane expert at Colorado 
State University in Fort Collins. The rise 
in sea temperature "is not related to foe 
warming of foe planet,” he said, noting 
that global warming has been slow, 
while die Atlantic sea-surface temper- 
ature jumped in a matter of months. 

It was Dr. Gray and his group of 
researchers who correctly predicted that 
1995 would be one of foe most active 
seasons on record, although they un- 

derestimated 1996. In April, the group 
forecast that 1997 would also bring 
more hurricanes than average, including 
tbe more intense ones. These major 
storms are defined as those with peak 
sustained winds of more than 1 10 miles 
an hour, and they account for 75 percent 
of all hurricane damage. 

The forecasters predicted that foe 
1997 hurricane season, which officially 
began Sunday and lasts through 
November, would produce 7 hurricanes. 
3 of which would be in the intense 
category, and 4 lesser tropical storms 
strong enough to be named. By com- 
parison, II of the 19 named storms in 
1995 were hurricanes, 5 of them severe; 
last year, 9 of foe 13 named storms were 
hurricanes and 6 were severe. 

The Colorado group's forecast ap- 
plies to an area encompassing foe At- 
lantic Ocean, foe Caribbean Sea and foe 
Gulf of Mexico. It is to be updated on 
Friday, but Dr. Gray said the update was 
not expected to depart substantially from 
foe April prediction. The forecasters do 
not attempt to predict whether or where 


any of the hurricanes will strike land. 

Tbe forecasts are based on an array of 
predictive signs and atmospheric phe- 
nomena that Dr. Gray has identified as 
determining hurricane activity. One is 
foe amount of rainfall in foe Sahel region 
of western Africa, where foe small areas 
of low pressure that are the embryos of 
hurricanes first form. When the Sahel is 
welter. Dr. Gray found, more embryos 
form. This year, foe Sahel is wet. 

A NOTHER factor is foe phe- 
nomenon known as El Nino, 
the huge pool of warm water 
foal develops every iwu tu 
seven years in foe eastern tropical Pa- 
cific, changing weather pane ms around 
the world. WTien it is in place, high-level 
winds blowing from the west tend to 
shear off foe tops of developing hur- 
ricanes in foe adjacent Atlantic, causing 
them to abort. El Nino may make an 
appearance later this year, forecasters 
say, but the Colorado group predicts that 
it will not do so in time to affect foe 
hurricane picture. 

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PAGE 13 

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Free of the 

Chicago Exchanges 
Seek Easing of Rules 

By John M. Broder ' 

New York Times Service 

C HICAGO — It takes sharp el- 
bows and a strong constitution 
to survive a day in the Eurodol- 
lar pit at the Chicago Mercantile 
Exchange. Contracts representing mil- 
lions of dollars in short-term interest-rate 
futures turn over every second in a ca- 
cophonous blur of hand signals and 
shouted orders. Moments of relative quiet 
are punctuated by frenzy as the electronic 
boards ringing the pit record tiny move- 
ments in the Eurodollar’s value. 

But, as buy as the Eurodollar pit is — 
nearly 100 million Eurodollar contracts 
were traded in 1996, making it the most 
actively traded financial future in the 
world - — Mercantile Exchange officials 
say they are losing business to over-the- 
counter traders, foreign exchanges and 
private swaps deals. 

The reason: Futures traded off the 
Chicago exchange are subject to vir- 
tually no federal regulation. 

From their earliest days as market- 
places for agricultural commodities, the 
Chicago Mercantile Exchange and the 
Chicago Board of Trade and the traders 
who work there have chafed at gov- 
ernment supervision. 

Now they want relief, and they have 
gone to Congress to get it 
In public statements and in legislation 
now before Congress that they largely 
wrote, exchange officials argue that fu- 
tures traders are sophisticated, consenting 
adults engaged in legal transactions, ft is 
in the traders' own interest to police the 

QncL K* nn -dy/Tbr Nr» Ynri Time. 

John Sandner, chairman of the Chicago Mercantile Exchange, left, and Brooks ley Born, head of the CFFC. 

action on the floor, die o fficials say, and 
they do not want or need federal chap- 
erones from the Commodity Futures 
Trading Commission looking over their 

“What we have is a regulatory model 
built for another time and another mar- 
ketplace, when most of the trading was 
in agricultural products,” said John 


Sandner, chairman of the Chicago 
Mercantile Exchange. “Now, 90 per- 
cent of our trading is in financial in- 
struments by large institutions, and our 
regulation, which is supposed to be over- 
sight, has become micromanagement” 

It may seem an odd moment for 
traders in some of the world's riskiest 
finan cial products to be pleading for 
regulatory relief. The recent history of 
costly failures in the trading of financial 
futures, swaps and other complex fir 
nancial products known collectively as 

derivatives justifies a vigorous regulat- 
ory and enforcement program, say fed- 
eral market overseers, who themselves 
have more often been criticized for be- 
ing weak than for being severe. 

They cite a litany of derivatives- trad- 
ing debacles: Barings Bank, Sumitomo 
Corp., Orange County. Procter & 
Gamble Co., MG Futures Inc. The losses 
are measured in the billions of dollars. 

Brooksley Born, a securities lawyer 
named last year to head the Commodity 
Futures Trading Commission, said the 
exchanges were seeking to swap gov- 
ernment supervision for their pleas of 
“Trust me/* 

Ms. Bom said: “Essentially, the 
CFTC has regulated the futures markets 
primarily through surveillance to try to 
detect fraud or manipulation in its in- 
cipiency. If we lose that power, we 
would be -^legated fo pursuing enforce- 
ment after the feci. Billion-, of dollars 

See RULES, Page 17 


Making Sense, and Cents, of Stock Prices 

By Floyd Nonis 

New York Tunes Service 

NEW YORK — After more than 
two centuries of using a. system de- 
scended from Spain, American stock 
markets now appear to be moving to- 
ward having stocks priced in the same 
way that just about everything else is 
priced -* J - in dollars and cents, rather 
than in units of one -eighth of a dollar. 

Under pressure from Congress and 
regulators, the Nasdaq stock market aid 
Tuesday that it would study moving to 
decimal pricing, as die use of pennies 
zatfaer than fractions is called, and prom- 
ised to take a position by SepL 1. 

“ft is time to take some I 
said Frank Zarb, chairman and 
executive of the National Association 
of Securities Dealers, the parent or- 
ganization of Nasdaq, in announcing 
that die organization would send a 
series of questions to brokerage firms 
and others. 

IFWail Street does move, it is widely 
expected that it would lead to better — 
as well as more easily understandable 
— prices for investors. That gain would 
cone at the expense of brokers, who 
have resisted the move in the past 

Some brokers’ profits come from 
the difference between what they pay 
to buy stock from some investors and 
the price they get in selling it to other 
investors. A change in pricing could 
shrink their profit margins. Advocates 
say that increased volume would fol- 
low from the better pricing and that this 
could partly offset the brokers' losses. 

The New York Stock Exc h a ng e, 
which has lagged behind as other mar- 
kets have allowed trading in incre- 
ments smaller than one-eighth of a dol- 
lar, or 125 cents, is expected to make a 
proposal related to decimal pricing 
Thursday, although officials would not 
say what was being considered. 

Some Wall Street executives say 
that a move to decimals is inevitable 
but that they hope to delay it until 2001 
so that the necessary reprogramming 

of computers would not have to be 
undertaken while programmers are 
still trying to solve the huge problem of 
how to. make computer programs, 
which generally record only the last 
two digits of years, distinguish the year 
2000 from 1900. 

Still, given that American brokers 
already trade many things that are 
in decimals, including stocks 
other countries, currencies and 
commodities, it is not clear how modi 
reprogramming will be needed; that is 
one of the issues on the NASD ques- 

Mr. Zarb said Tuesday that no de- 
cision had been made on whether to 

less than half a penny. Such trades, in 
fact, are allowed in the Nasdaq market, 
bnt broken cannot quote stock prices in 
units smaller than 1/1 6 of a dollar. 

Bui, while most investors under- 
stand eighths, and perhaps sixteenths, 
going farther down that road invites 
mass confusion. Would it be better, for 
example, to sell a stock for 25/64 or for 
3/8? (Answer 25/64, which is just over 
39 cents, compared with 375 cents for 

“If we’re going to go further than 
sixteenths, I think decimals m a ky 
sense,” said Richard Ketchum, chief 
operating officer of the NASD. 

Going to decimals would not ne- 

While most investors understand eighths, and perhaps 
sixteenths, in pricing stocks, going farther down that 
road would invite mass confusion. 

make the shift, but he added, “If the 
review demonstrates that decimal pri- 
cing aids investors in the purchase and 
sale of stocks, then we will do whatever 
is necessary to make it happen.” 

For generations, the smallest price 
movement allowed in stocks in major 
U.S. markets was one-eighth of a (fol- 
iar. That limit has been breaking down 
amid regulatory pressure to provide 
better prices for investors by reducing 
the spread between the price at which 
investors can buy — the “ask” price, 
in WaD Street jargon — and the lower 

S ice, called the “bid” price, at which 
ey can sell stock to a broker. 

The American Stock Exchange, the 
country’s third-Iargest market, moved 
this year to minimum spreads of 1/16 
of a dollar, or 6.25 cents, and Nasdaq, 
the second- largest, followed this week. 
Among major markets, only the NYSE 
has stuck to eighths. 

It is posable, of course, to quote 
stocks in thirty-seconds or sixty-fourths 
or even in units of 1/256 of a dollar, or 

cessarily mean that stocks could move 
only one cent from trade to trade. 

One of the issues raised in foe ques- 
tionnaire is whether a limit of 5 cents 
could be set and maintained on price 
moves. For investors, that would still 
be somewhat more flexible than foe 
minimum spread of 1/16, or 6.25 cents, 
now available on Nasdaq and the 
American Stock Exchange. 

Concerns have been expressed that 
if foe limit were 1 cent, brokers could 
effectively trade in front of customers’ 
orders by offering a penny more when 
they knew that a large customer order 
was going to drive foe price up. That 
practice is known as front-running. 

The decimal issue has moved to the 
fore in foe past year in large part be- 
cause of foe efforts of Steve Wallman, 
a member of foe Securities and Ex- 
change Commission who has cam- 
paigned for action to require markets to 
shift to decimals. 

Arthur Levitt, the SEC’s chairman, 
has not endorsed such legislation bat 

has said he thinks foe markets will 
move in that direction voluntarily. 

Mr. Wallman. praised the NASD’s 
move this week, calling foe benefits to 
investors “clear and unequivocal.” 

A bill pending in Congress, 
sponsored by Representatives Michael 
Oxley, Republican of Ohio, and Ed- 
ward Markey, Democrat of Massachu- 
setts, would require the SEC to order 
decimal pricing. The current moves by 
market officials appear in pan to be 
efforts to head off legislation. 

Narrower spreads would not auto- 
matically result from allowing quotes 
in finer increments. 

As foe Nasdaq market went to six- 
teenths this week, wily a few of foe 
most active stocks traded with a spread 
of just 1/16, and those did not do so at 
all times. But smaller quote increments 
do make such spreads possible. 

Antitrust investigators concluded last 
year that brokers in foe Nasdaq market 
had conspired to keep spreads unreas- 
onably wide, and foe SEC changed the 
rules to encourage narrower spreads. 
That led to foe move to sixteenths and 
helped to stimulate talk of decimals. 

But, while investors are likely to 
benefit from narrower spreads as six- 
teenths proliferate, and more so if foe 
markets move to decimals, foe benefit 
will not be universal. 

Brokers who now make money from 
foe spread are likely to look for ways to 
recover those profits, making an in- 
crease in commissions likely. 

In addition, it would not be surprising 
if competition led some brokerage firms 
to stop making markets in stocks. 

Still, moving away from eighths and 
quarters would be a wrenching ex- 
perience for foe tradition-steeped fi- 
nancial markets. 

The New York Stock Exchange 
traces its existence to a deal signed by 
brokers under a buttonwood tree on 
Wall Street in 1792. As part of that 
deal, the brokers agreed to fix com- 
missions at one-quarter of 1 percent of 
foe value of a trade- 

Kohl Defeats a Bid 
To Oust Finance Chief 

Bonn Also Affirms Euro Timetable 

By J[ohn Schmid 

International Herald Tribune 

FRANKFURT — Chancellor 
Helmut Kohl, feeing foe most severe 
budget crisis in his 14 years in office, 
rejected opposition demands for early 
elections and rallied his allies Wed- 
nesday in a boisterous session of Par- 
liament to defeat a motion calling for the 
resignation of his finance minister. 

Mr. Kohl also renewed his support of 
the single European currency project, 
countering foe growing ranks of skep- 
tics who predict the birth of the euro will 
be postponed beyond January 1999, foe 
planned starting date. The government, 
Mr. Kohl vowed, “will do everything 
— everything — to see to it that foe 
timetable and the criteria are kept to.'* 

The chancellor’s plea was also in- 
tended to reassure German voters after a 
series of public-relations blunders by 
Finance Minister Theo Waigel 
threatened to spread disenchantment 
with the Dew-currency plan among the 
already wary German public. Mr. Kohl 
issued a dire warning of the con- 
sequences of a delay, saying German 
exports and jobs were at stake. 

“We need foe common European cur- 
rency,” Mr. Kohl said, “ft is foe basic 
precondition for peace and freedom and 
for building the European house.” 

The criticism that rained down on foe 
government this week, reflected in 
Wednesday’s free-for-all denunciations 
by foe opposition, stem from Mr. 
waigel’s stopgap measures to plug 
holes in foe budget and meet the fiscal 
criteria for joining foe single currency. 

The German central bank and even 
Mr. Waigel's coalition allies charged 
foe finance minister with engaging in 
the sort of one-time budget fixes that 
Germany has decried in its European 
partners, moves that critics say have 
diminished Bonn’s authority within 
Europe and its credibility at home. 

Mr. Waigel this week abandoned 
plans to revalue Germany’s vast gold 
stockpiles and reap billions of dollars of 
paper profit He also came under fire for 
proposals to sell off some of the gov- 
ernment’s 75 percent stake in Deutsche 
Telekom AG, the national telephone 

company, a move that would leave Bonn 
reneging on its pledge last year not to sell 
additional shares before 2000. 

The government's chief economic 
adviser, Herbert Hax, called foe gold 
and Telekom measures “unsuitable” 
and "inappropriate" maneuvers that 
looked like “creatr e accounting.” 

[Hans Tiecmeyer, president of foe 
Bundesbank, indicated Wednesday that 
the government and central bank were 
close to a deal that would allow a re- 
valuation of foe gold reserves but delay 
any transfer of profit until after 1997, 
Market News reported from Interlaken. 
Switzerland, where Mr. Tiecmeyer ad- 
dressed central bankers.] 

In a measure that analysts described 
as too little and too late. Mr. Waigel 
announced a spending freeze Wednes- 
day requiring his approval for all federal 
expenses larger than 1 million Deutsche 
marks ($582,000). Such a measure so 
late into foe year would only save a few 
billion DM of the estimated 20 billion 
DM to 30 billion DM budget shortfall, 
economists said. 

Rudolf Scharping, parliamentary 
leader for the opposition Social Demo- 
cratic Party, said Mr. Waigel's “un- 
serious and hectic” policies had become 
a “considerable burden” for Germany. 
He demanded that Mr. Kohl fire him and 
clear foe way for new elections. 

■ Sweden’s Euro-Rejection 

The European Commission said it 
would be up to European Union leaders 
to decide whether Sweden could opt out 
of foe single currency, while Prime Min- 
ister Tony Blair said it was highly un- 
likely that Britain would be among foe 
first countries to adopt the euro. Reuters 

Jacques Santer, the president of the 
European Commission, said in Brussels 
that only EU heads of state and gov- 
ernment could decide whether Sweden 
could skip monetary union if it met foe 
fiscal criteria. Sweden said Tuesday that 
it would not join right away. 

In London, Mr. Blair told Parliament 
that it would be better for economic and 
monetary union not to go ahead at all 
than for it to start with “fudged” con- 
vergence criteria. 

As Czech Economy Slips, 
Klaus Looks for a Miracle 

By Peter S. Green 

International Herald Tribune 

PRAGUE — Amid foe collapse of foe 
Czech economic miracle. Prime Minister 
Vaclav Klaus said Wednesday foal he 
would ask Parliament for a vote of con- 
fidence next week in his new cabinet 
Pressure is mounting for Mr. Klaus’s 
resignation, and even his political allies 
say he deliberately ignored foe nation’s 
growing economic woes. 

Mr. Klaus shuffled foe cabinet last 
week, replacing his finance minister and 
outlining a new economic plan. But few 
details nave appeared, and Mr. Klaus has 
admitted that a similar legislative pack- 
age announced in April was inadequate. 

Foreign Minister Josef Zieleniec said 
late Tuesday that Mr. Klaus had failed to 
tell foe cabinet about a letter from foe 
International Monetary Fund urging rap- 
id measures to improve foe economy. 

■ Mr. Zieleniec said be did not have foe 
letter when the government was drafting 
the economic legislation in April 
“The letter was from foe beginning 
of April,” said a senior official who had 
read it, “and it predicted what would 
happen to the koruna." 

Mr. Klaus dismissed the letter's im- 
portance. He acknowledged that be had 
received three faxed notes from the 
Fund that he did not distribute to the 
cabinet but insisted that the notes merely 
reiterated recommendations in a March 
report from the IMF on foe economy. 
“They were related to the report and 

reminded, for example, that the Fund 
really thinks that wages grew too fast 
here,” Mr. Klaus was quoted by 
Bloomberg News as saying. 

The dispute with Mr. Zieleniec, an 
economist and a co-founder of the Mr. 
Klaus'sCivic Democratic Party, reveals 
a growing rift within foe government's 
center-right coalition and foe party. 

Deputy Prime Minister Josef Lux has 
publicly called for Mr. Klaus’s resig- 

Milos Zeman, leader of foe oppo- 
sition Social Democrats, has promised 
to call for a confidence vote. 

Mr. Klaus has been under increasing 

[ >ressure to tackle the economic proh- 
ems and restore public and investor 
confidence in what was until recently 
Central Europe's best-performing post- 
Communisr economy. 

A high fixed -exchange rate, high in- 
flation, unregulated markets, unrestruc- 
tured industry, sharp wage increases 
and a massive trade deficit nave brought 
the country to foe verge of economic 
collapse. The koruna has lost nearly 15 
percent of its value against foe dollar in 
foe past month, the stock market is down 
8.1 percent over foe last year, and 
overnight interbank interest rates are 
hovering near 50 percent. 

Foreign investors have pulled hun- 
dreds of millions of dollars out of foe 
country, and central bank efforts to pro- 
tect the currency have dried up foe 
money supply, pushing many Czech 
companies to the edge of bankruptcy. 


Cross Rates 

June 4 LibkHJbor Rates 

June 4 


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U.S. Pounds on Heathrow’s Gates 

Regulator Says BA- AMR Should Yield Some Landing Rights 

SOPOB 8*>tcr % uewawfc . 

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By Adam Bryant 

New York Times Service 

Key Money Rates 


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Soukk Realert. 

WASHINGTON —The General Ac- 
counting Office said Wednesday that 
American Airlines and British Airways 
should give up a number of their valu- 
able landing rights at Heathrow Airport 
in London. 

The statement, foe first formal opin- 
ion from a federal agency on foe pro- 
posed alliance between American, a 
unit of AMR Corp., and British Airways 
was given in testimony for a Senate 
Commerce Committee hearing. 

The congressional watchdog agency 
decided that to increase competition, 
other U.S. airlines should have foe op- 
portunity to fly at least 23 daily round 
trips into Heathrow, and that most, but 
not all, of those landing rights, also 
known as slots, would come from Brit- 
ish Airways and American. 

The two airlines, which announced 
their proposed alliance a year ago with 

promises of many benefits to travelers, 
have come under considerable fire from 
other U.S. airlines, which have con- 
tended that the alliance would lead to 
less competition and higher feres. 

The two airlines now account for 38 
— or 69 percent — of the 55 daily round 
trips between the United States and 

Because of a long-standing agreement 
between the two countries, American 
and United Airlines are the only U.S. 
carriers allowed to fly into Heathrow, 
one of foe busiest airports in the world. 

"To ensure increased competition,” 
the General Accounting Office said, 
“the other major U.S. airlines that fly 
internationally would need to serve 
Heathrow from their principal hubs.” 

But the agency also appeared to favor 
pursuing such a broad agreement, ar- 
guing that ‘ ‘significant new entry would . 
likely provide substantial benefits for 
consumers in both countries in terms of 
lower feres and better service.” 

Spokesmen for American and British 
Airways declined to comment imme- 
diately on the testimony. But Chris 
Chiames, a spokesman for American, 
added, ‘ ‘The gist of foe report is positive 
in terms of recognizing foe benefits of 
open skies and that this alliance ought to 
move forward.” 

Americas and British Airways have 
tentatively agreed to a suggestion from 
foe Office of Fair Trading in Britain foal 
the two airlines should divest them- 
selves of slots for 12 daily round-trip 
flights, roughly half foe minimum sug- 
gested by the U.S- agency. 

The testimony of foe General Ac- 
counting Office carries only foe weight 
of an opinion, and several hurdles must 
be cleared before American and British 
Airways can put their proposed alliance 
into effect. 

Even if all parties agree on foe re- 
distribution of daily landing rights, they 
must then consider how British Airways 
and American would be compensated 


1’AUE 14 

— • 6.65 



Oracle Unveils CNN Service 

J F M A M J 

; 1996 

Exchange indax 

j”> m a’ M J 



The Dow 

S&P100 • 
Nasdaq Composite 

Toronto TSE Index 
Sac Paulo Bovespa 
TterieoCity Botsa~~' • 
Buenos Aires Merval 
Santiago IPSA General 
Caracas Capital General 
Source : Bloomberg, Reuters 

■72SM5.: : ; tQ^ x 

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572131 572141. -0.04. 

NA 7042:69 . . : 

Invnutnaai Herald Tribune 

By Mitchell Martin 

Iwmaiienal Herald Tribune 

ATLANTA — Oracle Corp. 
and Cable News Network intro- 
duced a free personalized Internet 
news service Wednesday, an at- 
tempt to capitalize on the con- 
vergence of computers, commu- 
nications and broadcasting. 

Although similar services 
already exist, this one is a show- 
case for the idea of network-based 
computing, an idea backed by Or- 
acle Corp.'s chairman, Lawrence 
Ellison. The new service, called 
CNN Custom News, will carry ar- 
ticles from approximately 150 
sources, of which about a dozen 
provide real-time news. These in- 
clude Reuters. The Associated 
Press, Bridge News and CNN. 

Mr. Ellison and Ted Turner, 
vice chairman of CNN's corporate 
parent. Time Warner Inc., demon- 
strated the service at Comdex/ 
Spring 97, the computer trade 
show here. The service is available 

at or, and will 
carry advertising. 

C)ne of the advertisers will be 
Citibank, and executives from the 
bank and from CNN said they ex- 
pected significant international in- 
terest Mr. Ellison predicted that 
the service would have hundreds 
of thousands of users. 

Mark Schlack, editor in chief of 
Byte magazine, said he did not 
think the service broke new 
ground, noting that large news or- 
ganizations such as The New York 
Times and The Wall Street Jour- 
nal, as well as CNN itself, already 
provide similar offerings. He said 
the service would “live or die” 
based on how well Oracle's 
searching software. ConText, 

That software, Mr. Ellison 
promised, ran do complex them- 
atic indexing as well as simple 
word searches, meaning that users 
can more precisely target the news 
they want — for example, choos- 

ing a few articles that focus on 
Japan rather than every article mat 
mentions the country's name. 
Some of the service’s competitors 
have been criticized as bombard- 
ing their customers with unwanted 

When Mr. Ellison introduced 
die idea of network computers in 
September 1995, he predicted the 
coming of services such as CNN 
Custom News. In this case, users 
tap into server computers via per- 
sonal and network computers, 
pagers and televisions. 

In his vision of die future of 
computing, Mr. Ellison has been 
pitted against Microsoft Corp.'s 
chairman, Bill Gates, who insists 
that the bulk of computing will 
continue to take place on personal 
computers rather than move to net- 

Mr. Ellison refused to say how 
much Oracle had invested in the 
CNN Custom News project, but 
Mr. Schlack estimated it was sev- 
eral million dollars. 

Very briefly: 

Sears Settles U.S. Credit-Card Case 

WASHINGTON (Combined Dispatches) — Sears, 
Roebuck & Co. agreed Wednesday to refund $100 million to 
credit-card holders to settle the Federal Trade Commission's 
charges that it pressured bankrupt customers to pay off their 
cards even though their debts ha -*cn wiped oul 
R egulators said Sears. America's second- largest retailer, 
induced consumers who had fil .1 for bankruptcy protection to 
sign agreements reaffirming ineir Sears credit account debts to 
keep their Sears credit canL *r merchandise. 

The practices may have ; .fee ted more than 200,000 cus- 
tomers, the agency said. (AP. Bloomberg) 

McDonald’s Halts Promotion Drive 

OAK BROOK. Illinois (Bloomberg) — McDonald's 
Corp.'s share prices fell Wednesday after the company an- 
nounced it would phase out its promotional campaign offering 
55 -cent sandwiches, conceding that the controversial effort to 
revive U.S. sales had stumbled 
Shares of the fust-ii-uJ restaurant company closed at 
S47.K75. down S7.5 ccr'v m New York trading. 

The promotion, introduced in April, ran into criticism from 
analysts and franchisees for being unfocused and confusing to 

Separately, two analysts lowered their ratings and 1997 
earnings estimates for the fast-food giant to a range of $2.45 to 
S2.48 a share from a range of $2 50 to $2.52. 

« Fast man Kodak Co.'s Image Bank unit has purchased 
Archive Holdings Inc., the world' s largest provider of archival 
Mock footage and photographs: the price was not disclosed 

• Ford Motor Co. said U.S. sales of cars and light trucks fell 
3 percent in Mat from a strong year-earlier period. Ford also 
said it would start building 250,000 cars, minivans and pickup 
trucks annually (hat could bum either ethanol or gasoline, as 
part of a U.S. alternative-fuels program. • NYT. Bioombem 

Ahmanson Drops Takeover Bid 

Ciwtyitnl Oht Suff Fmn Dnpsadvs 

IR WIND ALE, California — 
H. F. Ahmanson & Co. withdrew its 
offer to buy Great Western Finan- 
cial Corp. on Wednesday, coding a 
fierce takeover battle. The move 
paved the way for Washington Mu- 
tual Inc. to buy Great Western. 

Ahmanson said it decided to end 
its efforts after a ruling Tuesday by a 
Delaware Court permitted Great 
Western to hold its special share- 
holders' meeting on June 13. 

The ruling, coupled with the mar- 
ket valuation of Ahmanson's pro- 
posal, led the bank to conclude that 
it was unlikely to win without rais- 
ing its bid. 

Ahmanson, based in Irwindale, 
California, launched its hostile bid 
on Feb. 17. only to be forced to raise 
its offer a month later after the 
Chats worth. California-based Great 
Western reached a friendly agree- 
ment to be acquired by Washington 
Mutual of Seattle for $6.6 billion. 

Computer Issues’ Blues 
Drag Market Lower 


A spokeswoman for Ahmanson, 
Mary Trigg, said the company did 
not believe it could raise its bid for 
Great Western without harming its 
own shareholders. 

All three concerns have been try- 
ing to expand beyond their tradi- 
tional business of mortgage lending. 

. Great Western has a national con- 
sumer-finance company that could 
be expanded, and Ahmanson has 
been making consumer loans out of 
its branches. ( Bloomberg , AP) 

VtmuMhrfh* SvtfF»'">b‘wn*' 

NEW YORK — Stock prices re- 
treated Wednesday as computer-re- 
lated shares fell oa profit warnings 
and financial stocks dropped on 
concern that interest rates might 
rise, stifling borrowing by con- 
sumers and businesses. 

The Dow Jones industrial aver- 
age finished 31.76 points lower at 
7,280.39, with declining issues 
leading advancers by a 7-to-5 ratio 
on the New York Stock Exchange. 

The Standard & Poor's 500- 
stock index was down 4.63 points, 
at 840.85, while the Nasdaq com- 
posite index was off 6.43 points at 

1,378.48. Kr 

The drop among Nasdaq stocks 
was led by technology issues after 
the software developer Integrated 
Systems, the networking company 
Cabletron Systems and the disk 
drive maker Seagate Technology 
all warned that earnings for the cur- 
rent quarter would fall short of ex- 
pectations because of slack de- 

Integrated fell 1 7/16 to 1216, 
Cabletron finis hed unchanged at 
30 '4. and Seagate dropped V* to 

In re I, which has also warned that 
it expects its earnings not to meet 
forecasts, fell 3 7/16 to 141 9/16. 

Investors said stock prices in the 
group were unlikely to rise much 
until corporate earnings were re- 
leased in mid-July. Those reports are 
expected to give investors a clearer 
picture of whether the sales slow- 
down mentioned by Intel and others 
is limited to individual companies or 
might be industrywide. 

“I think we're sort of in a trading 
range through the earnings report 
period here,” said Bob Finch of 

Aclnis Investment Management, 
“People are going to be less willing 
to chose stocks to new highs, par- 1 
ticulariy those involving computers . 
and networking products." 

With most investors looking 

Dollar Emerges Winner in German Gold War 

iTiwf i W In Our SmjS Frwn Dupmchn 

NEW YORK — The dollar rose 
against other major currencies Wed- 
nesday as financial markets sought 
to decide the impact on Europe's 
monetary union of the German gov- 
emment's capitulation to the 

Hie dollar's gains came in the 
aftermath of Bonn’s retreat Tuesday 
from a plan to revalue reserves to 
help meet the fiscal criteria for the 
single European currency. 

The dollar was quoted in 4 P.M. 
trading at 1.7288 Deutsche marks, 
up from 1.7278 DM on Tuesday. 

Although a series of statements 
by Chancellor Helmut Kohl, Fi- 
nance Minister Theo Waigel and 
Bundesbank President Hans Tiet- 
meyer calmed the foreign-exchange 


market, traders said the fallout from 
the German battle of wills would 
reverberate for some time. 

“The damage has been done." 
said Teis Knuthsen, economist at 
First Chicago in London, adding, 
4 ‘The feeling in the market is that the 
German Finance Ministry is pre- 

pared to do pretty much anything to 
get its deficit in line.” 

Traders said that comments by 
Mr. Tietmeyer indicated he did not 
seem id object to the dollar’s rise. 
"‘The mark's present downtrend is 
not a source of worry," he said, “but 
we are interested in a strong mark." 

Against other currencies, the dol- 
lar was at 116.265 yen, up from 
1 16.205 yea, at 1 .4450 Swiss francs, 
up from 1.4376 francs, and at 5.8306 
French francs, up from 5.8255 
francs. The pound eased to $1.6332 
from $1.6347. 

The pound lost some ground after 

statements by the governor of the 
Bank of England, Eddie George, at a 
meeting of central bankers in In- 
terlaken, Switzerland. 

“George, who called the pound's 
present level too high, raised doubts 
about a possible increase in British 
interest rates this week," said Keith 
Edmonds, an analyst at Industrial 
Bank of Japan. 

The Bank of England's monetary 
policy committee, which has new 
powers to set interest rates free of 
direct government intervention, 
convenes Thursday and Friday. 

(Reuters. AP i 

ahead to Friday’s report oa US.! 
payroll and wage levels — a major j 
factor behind inflation — trading! 
was fairly hesitant Investors look 
little action on a report that factory 
orders grew 1.2 percent in April, 


even though. the data c om po u nded 
recent indications that manufactur- 
ing activity was surprisingly robust 
in May. 

Such strong economic activity 
could lead the Fed eral Reserve. 
Board to raise interest rates when its 
policymakers meet in July. The. Fed 
raised rates in March because of con-, 
cem rhnr inflation was accelerating. 

"The stock market has done a 
year's work in six months," said 
Ronald Muhlenkamp, chief invest- - 
ment officer at Muhlenkamp & Co. 
"If the market's return over time is, 
about 10 percent a year, we’re' 
already there." 

Bonds fell on interest-rate con- 
cerns, with the benchmark 30-year 
Treasury bond dropping 5/32 to %' 
25/32, raising its yield to 6.88 per- 
cent from 6.87 percent Tuesday. 

Among the Dow’s biggest de- 
diners were companies that lend 1 
money, either through credit cards! 
or corporate loans. American Ex- 
press fell I % to 68%, and J.P. Mor- 
gan % to 108. ; 

Bur H.F. Ahmanson rose \V» to. 
41% after (he thrift company with- 
drew its $6.6 billion hostile bid for. 
Great Western Financial, a day after! 
failing to block a vote on a friendly 
bid from Washington Mutual. * < 

General Motors fell % to 56%', 
after the automaker said hs U.S.| 
vehicle sales fell 8.1 percent in- 
May. The statistics provide another! 
sign that consumers are tumingcau-. 
rious after a robust first quarter.- 
analysts said. 

PepsiCo declined 2'A to 36 after 
Chairman Roger Enrico said the 
beverage company might use gains! 
from the sale of its restaurant supply 
business to help it meet its annual 
earnings goal. 

Eli Lilly rose % to 93% on ex- 
pectations the company would re- 
port encouraging results Thursday 
from studies of its new osteoporosis 
drug Evista. The market for drugs 
that prevent bones from becoming 
brittle is expected to reach $5 bil- 
lion by 2005. (Blrtnmbeni, AP) 



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inan mis* giiis 7JSE.9J 73 * 04 * 

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yn mjo tom, zmtb hub -iti 
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h"i«i l*|f 

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Tramp. 020.35 611 12 617.37 611.72 

WiWres 193.17 191.55 I9Z52 1*1.7* 

Finance 98.16 94J6 95.67 9526 

SP 500 8506* B41J1 845.48 840.11 

SP TOO 832.26 821.70 826.84 820J7 

Law LM Ck, 
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3*0.47 H483 553.53 1.94 

4001 401 IB 401.34 -383 

J74-J0 7TLX fflil .139 
40168 399 JU 400JI AM 

Most Actives 

June 4, 1997 

H*gh Low Lutes! Olge Ophit 



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Dec 97 3440 2190 2405 -047 18.923 

San 98 7468 7408 74J7 -045 U7S 

EB. sales NA TWi-sdes 1A357 
Tue's open int 10243F up 534 

Dow Jones Bond 

20 Bonds 
LOU Wiles 
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Trading Activity 




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NovOT «1 






Jan 98 691)5 






Ed. sates NA 

Tub's setes 





in 2509 


5400 bu mWirwm- aem« par bushel 


Clw 6m. 

1178 1495 Advpntxd 

1363 1031 Deemed 

sw in Unchanged 

3361 330 ToUiHUn 

173 77* NemHItflS 

8 17 Now Lows 

Market Sales 

aw Prw. 

»1 577 

273 759 NYSE 

^ 'J Nasdaq 

2 4 In motions. 



352 Yi 


— B*4 


Sep 97 






Dec 97 


371 Vr 

373 ■A 










Conpony Per Amt Rec Pay 


NthrasiinvGfvi _ .10 6-11 6-12 


Berkshire Gos O J85 6-30 7-is 


Leungtan B&L .. .15 6-25 7-1 i 

MFCBnct LWg _ 41 4.12 6-ti 

OnKdaFmn _ .16 s-i* 7.1 

TJX Cos n _ .05 8-7 8-28 


AmerFstApIlmr M 4625 i>30 7.25 

AmeiFsITx M IMS 4-30 7-25 

AmerFstPa M .0083 6-30 7-31 

Berry Petrol A, O ro 4-13 4 .J 7 

CanBncshra O jn *-!5 7-is 

C 01 Bncshri 
Cdn Marconi 9 


Central Vermont 

»30 7-25 
4-30 7-25 
6-30 7-31 
6-13 4-27 
6-15 7-1 S 

6- 12 7-3 
7-1 7-16 

7- 32 B-15 

Century Alum 
Devon Energy 
FFB5 Bancorp 
Fat Bernal 

FsJ Liberty 
Haywood BncshR 
Hedneridi Poyne 

Mentor inco Fd 
PcimCorp Had 
Scwn&ftc Techs 
Stone St Bncp 
TrvsrCoflkCp NY. 

a-QmtPQfc b-aponndmate mawil ptr 
Uwra/ApRj e -payaMa la Cnanaw kmd*; 
m-raofltWy; tj-qwrtorty; rankroNl 

175* 19*6 

1539 20 a 
7174 1777 
5*71 5730 
107 1(5 

47063 637.55 

19.11 2952 

55122 58640 

Per Amt Rec Pay 

O US 6-16 6-30 
Q -05 4-16 6-30 
5 XS 6-17 7-1 

Q .03 6-16 6-30 
Q .10 6-14 7-1 

a at 7-ta 8-1 
a .14 6-19 7-8 

a .13 8-15 9-3 
0 3875 6-30 7-15 
M .07 6-16 v30 
0 M 6-17 7 -1 

Q .05 6-16 6-37 
O 5X25 6-20 7-1 

O .28 6-16 7-1 

O .1125 4-17 6-27 
Q .275 6-4 7-1 

Q .12 6-20 6-27 

Stock Tables Explained 

^ ^figures are unalfiooL Yearly highs and lam rtf led the previous S3 weeks pure the 
^ hH«t hading tay. Wherea spin orstock dividend arrnunnng lo 25 
^ h ^ h lk * rar 5 e 0,1,1 show" fcrthenew 

1 oltwrw'so noted rales tf dividend are annual fflsUursementSi based an 

itw hii«i dccJaralion. 
a - dundOfid also extra h) 

a ■ oniDciiD uimj extra ni. a - initial dhride/Mt anmiQl 

b - annua 1 rale ot dividend plus slack dt- . prtaMtS 5 S» X 

- initial dividend annual rule unknown. 


c - IlguhSaling dhridena. 

ee - PE exceeds 99. 

dd- called. 

d ■ new yearly low. 

dd - loss in Itw Iasi 12 months. 

q • doKd-erid mutual Fund. 

r- dividend dec ki red or paid in precedna 12 

months, plus slock dividend. 

s- stock spilt. Dividend begins with date of 

sis -soles. 

e-tfividwd deck? red or paid in preceding 12 I - dividend paid In slack in preewang 12 

. ^ _ __ monltii estimated cash value an ex-dl- 

t. annual rale. Increased on last fledu- wk-mi or c« -distribution dote. 

wrnn. u . new yoorty \Ml 

^ - dividend in Canadian funds- subfeci la v- Trading tatted 

IS*,- i wnw idence fan. vl-ln bankruptcy or reosiverstila or beliia 

»- wowed flltcr spfit-up or stock reorpaniied under rtw Bankrapfcy Act. or 

d mide na. ^ . secirrlHw assumed by such conponies. 

I ~ P 010 qm n moeteTK L or wd- wtiendbWbuteo. 

r>3 odkvi taken at tateskkviaend meeting. wl - wtKn issued' 
k • tWdend dedared or paid this year, an ww-wHli warrants, 
occumutottwc 63uc uniti dhrtdcntb in aneara. * - e* -dividend orex-rtgfrts. 

n - annual rale, reduced on hist dedara- xdis - ra-dlstnburton. 

Iren- _ m-wtttaui warrants. 

n- now issutiri tne posJHwwKs. The high- y*e*-dhndend and Mies hi fulL 
UM range begins with the start nf tradkhj. yW- yield, 
nd - nc*t day delivery. z - sain in hill. 

Ed. sales na Tub’s. soles 12474 
Tub's open mt 81J85 ofl 403 



40.000 to*. - anti per • 

Am 97 6445 44.07 64.11 -005 

AugfT 6447 6402 6412 -OIO 

Od 97 *7.75 6747 67 JB —002 
Dec 97 7025 69.95 7012 -OIO 

R* 9fl 71 07 7B.90 7097 —OIO 

Apr *8 7190 7165 7170 — OIQ 
Ed.sdes 1-L05D Tub's, sdes 2X639 
Tup's open Int 104511 up 417 


54000 b* - aonn per to. 

AUB97 77 JS 7648 77 JO +015 

5e»97 77 a5 7680 77 JO *0.20 

Od97 77 JS 7495 7740 *010 

Nov97 79 JD 7055 7845 +012 

Jan 98 79.75 79. IS 79.50 +015 

Mar98 79J0 79.85 79A0 +OI0 

Ed soles J TS7 Tub's, sties 4 M3 
Tub's open tel 194979 ofl 338 


*040(1 IM.- cenre per it. 

Am 97 81.40 8077 81.22 +04S 

AR97 8175 81.99 I2J7 +022 

AU997 90.90 8025 8062 *(L7Hj 

Od« TJJ7 71*5 7115 +032 

Dec *7 70J5 69.90 7002 +007 

ESI. sol« 11073 Tur's. sates WJ99 
Tim's Open tel 39,200 up 237 


40A0O(».- cents per a, 

JI497 S1J5 n» 90S +095 

Auh97 9|JM 8* JO 89 JO +OS 

FefiOS KB 7|J5 79 . 1 s -040 

Ed uses 3,711 Tub’s, sefes 2J85 
Tub's own ml 7J64 ofl 139 



lens- S per m 

Jult? 1433 Mil mo —29 74,241 

3wW 1471 1459 1461 -37 W.S76 

Dec W 1501 1491 1443 —23 19.996 

*6ar» 107 1530 1521 —23 71.181 

MavW 1541 1537 1537 —25 U6* 

Ju>9B 1558 1553 15S4 -28 5S5 

Ed. sates 12.800 lira's sates 1UI0 
tub's open vd tsm ua 713 



ww 36450 25000 25165 -12.45 11J22 
S«pw 51-S2 27410 22iia —7.95 8,139 

S* 4 ” 1WJ1U W0J0 -415 4,9*1 

«Uir9B 18X00 171 JS 17410 -ISO 2.162 

. f71A0 -IAS 472 

Ed. sates 8.448 Tin's, sales 11J65 
Tin's gaen ml 27^37 up 47 


1174309 lire -emit per to. 

!!■?, ,IJ4 ,,SI 77.212 

MB JJ.M 11.16 1U2 +083 54789 

***** J]-f| 1IA7 11J1 tOOt 39.033 

MOV98 11.11 1180 11.10 +004 6.771 

Est. sales 3X315 Tin'! sales JUSi 
Tin's open int 174401 w 7822 


100 WDV O*-- dot tars per rrov ol 
J un97 342-50 34070 34090 -2.10 SS6 

A4 97 3*2.90 34210 3*210 -210 I 

Aug *7 344-JO 34X40 34160 -210 45.327 
0077 3*720 34680 346.01 -130 7^413 

Dec 97 VIM 34050 34050 -230 26864 
F9U98 35180 -230 7.608 

Apr 98 3538) -2J0 1823 

Am 98 3®.®) -230 7874 

Aug 98 35070 -240 7S2 

ESI. sales NA Tub's, sates 19,670 
TuCsmteM ISA01 up 799 


XJm tos, - aen« per to 

Jun77 117.10 11480 11520 -JJ0 1846 

JM97 117.10 11490 USAS -L45 33.721 

Aug 97 11425 11120 11385 -186 2283 

Sep 97 11X9J 11230 11165 -130 6775 

Oct 97 11180 11065 11065 -1.35 1.126 

Nov 77 107.15 -0.75 1216 

Dec97 10290 10760 108.15 -475 5,783 

Jtte 96 106J0 -OJO 656 

FebTB 10490 — 0.70 541 

Ed. sates NA Tin's, sales 6830 
Tue’s aped W 57650 up 657 


SABO <rm •» - com per trov m. 

Jun77 46830 -200 2 

Jut 77 4744 to 46780 47080 -260 57669 

5ep97 477J50 47X50 47420 -2M 6AO 

Dec 77 «3J0 479 JO «0.« -1HJ 7.?5B 

Jan 91 *8230 — 100 17 

Morn 48950 *84.90 4B490 —110 6.500 

Way 98 49000 -110 270 

Ju(9B 47470 -110 JA4T 

Ed. sales NA Tue'i.sdtes 9664 
Tin's men int 91.915 up Ol 


SB ira* omj- iMmMmrK. 

Jut 97 41100 37250 41160 +9.90 1X797 

0077 39460 389.10 37460 + 460 4821 

Jan 98 Wrt 39080 39060 +440 1.286 

Esc. sales na Tin's, soles 2.944 
Tin’s Open irV 19,926 Off 205 

Close Previous 


Dalian: per metric ton 
Atuukroai |HM Grade) 

Spot 156980 1570.00 155380 155480 
Forward 159380 15931* 157780 1578.00 
Copper cathodes 1IM Grade) 

Spa I 2533’A 2536** 253580 2538.00 
Forward 2475V* 247680 24783)0 2479 00 

Sptf _ 6I2.M «rt80 610.00 41180 
Fnword 63600 07.00 62280 673.00 

Spot 704080 706580 7055.00 706580 
Forward 713080 714080 716580 7170.00 

Spar 555580 556580 5415.00 562580 
Forward 561080 562080 567080 567580 
Hue (Speckd High Grade) 

Spat 131980 132080 129980 130100 
Forward 1344.00 1345.00 132480 132580 

High Law Close Oige Oplnt 



SI •Valon'pK 4* 100 pd. 

Jun97 9496 94.91 9494 4154 

SwV7 9448 9445 9465 5853 

Dec *7 9448 8*7 

EsLsoles NA Tue*s.scin 665 
Toe’s open W 10807 up 703 


llOTUMSprln- pis AUlhspf IQoprj 

Jim 97 105-53 105-44 105-50 920*7 

Sep W 105-38 105-28 105-31 131 «* 

DecOT 105-19 105-18 105-U +02 «* 

Ed. sides NA tub’s, sides 74 M3 

Tue'sapannt 224807 up w 


tlMUMOprn- pt*S. finds of 100 Pci 

JunOT 187-29 107-23 IU7-26 —01 151897 

S«POT W-12 107-05 107-09 -01 

DecOT 106-31 104- Jl 106-31 -01 m 

Ed. sales NA Tin's, sales B4.15* 
Tin'snceAdU 354,987 off ]619 


u pa -t unaoo-pM a fine-, oi ira pa* 

JunOT 110-19 110-06 110-13 _CB 195477 
Sep 97 110-05 109-M 110-00 -S 
DecOT 109-34 1Q9-IS 109-W _ ra h ' m 

MtrW 109-12 2jE 

Est.sfles na Tin's sides 312,545 
Tue’sopehdtt S30J79 alt 17473 


U rtlJkJrV pre nr IH BC1 

JunOT 9430 9429 Wjn », 

M77 9425 9dJ4 Sjs llSJ 

Aug 97 9419 9418 9419 in« 

Ed. safes NA Tin’s, sales 2,11? ^ 

Tin’s open tm 31.675 1*157 

High Low Lote-sl Chge Optra 

Z un JE 121-* ’SI -? 6 101A9+ 0.04111.015 
SEES 10 £-^ 10 2-2' ’22^“+ 08315X848 
ISf* 7 . N'L »A4+ D. 03 269863 

Ed. sates: 332,908. Prey, sates: 377813 
Prev. open int.- 269863 ofl Z418 
FF500800 - pS ot 100 pd 
Scp«>7 17788 127.44 177J0-8J8 55861 
Dec 97 97-30 97.30 96. V 2 — 0.78 0 

Est sales 203^20 . Open bit: 231X016 up 

ITL200 million • pis at 100 pd 
Jun 97 1 29 86 129-47 12980—020 32,960 
Sep 97 130.88 13025 13048-042 7X509 
Dec 97 103.70 103.40 1 03^8-007 0 

Est. sales 74002. Prev. soles: 142857 
Prev. open Int.- 104*69 off 12,266 

Si mUlMvrare 0 * IDO prt. 











Aug 97 


























Sep 98 






Dec 98 






Mar 99 











Sep 99 




+001 67741 

Tin’s Open int X746J41 UP 9668 

ASH pound*. 1 per pound 

JunOT 14350 1424) 1A1I2 36J01 

Sec 97 I A3 10 16210 1.4276 LSI I 

DecOT 1-6790 113 

Ed. sales NA Tin's, rates 4.409 

Tin's open int 41-825 up 294 


laum doflers, S per Odn. cflr 

JunOT .7283 7287 7277 56814 

Sep 9? J330 JJ13 .7325 10,704 

DecOT 7364 7363 .7364 IA59 

Ed.srtes NA Tin’s- soles tJQt 

Toe's open W 70807 up 46 


1 SS,M0 mor+T. % per nwt 

JunOT J800 -5771 5780 75.130 

Sep 97 J838 5810 JBI8 18.169 

DecOT 5862 5657 .5960 52] 

EsLsates NA Toe's. sales 34557 

Tim's cow ira *3,944 up 3B46 


1 IS mi Inn von. Suer ICOym 

JW97 8641 8598 8417 73.958 

Sep 97 87B 8770 8731 9,259 

Dec 97 8845 8845 8945 m 

Ed.sdes NA Tin's, sales 12^59 

Tub’s open irt 94.109 up 69 


175.000 francs, s pst iranc 

JunOT 8986 8908 8920 3B807 

SwOT 7064 8985 8993 68/2 

DecOT 7110 7070 .7070 yl 

Ed.sraes na Tub's. sides i68ia 

Tin's apart ini 45.882 an 1061 
fiumo puses- 1 per oc-*i 
Jun 97 .12565 .12520 .12552 16.5(4 

Sep 77 .12077 .12045 .12055 11,964 

Dec 97 .11620 .11410 .11620 71M 

EsLsaos na Tug's, soies c ru 
Tin's open M 3BJ74 off H2* 


C5OH0O0 -pS Of 100 net 
Jun 97 7X36 93 ^ 93T4— nm 

SwW M.T9 9114 93 /ltl ow 3.214 

S'Sf VrV W-00-OA4 1385 
yV’SS S'S ‘72-88— O.04 

J™ j W.61 92.76 92.79 — 0.0* 46 jm 

r£2 S'" W-7B 92.73- ara aS60 

B^nS S'® WjSA 9288—0.03 2(lBI8 

S' 67 9162 9285- ara 19829 
Jun 99 92.65 9281 9283- M* Tl Jn 

^P'j£ 9284 92.60 9283- Sra B.W7 

R ® 1 - 99 W83 9283 9282— 0J)3 7-417 

Moroo vm 92.60 VL61- tnn llffl 

EsL sales; 54401. Prev. sales: 8 IV 9 I 4 
Prev. open inL liiOK off in.hf, 


%85 + <L0l 244672 

Marffl 96 55 9652 9654 + 0.01 219 Me 
e Un S 9&J4 9636+ 001153:51)2 

98 96.17 96.13 96 15+ (L01 131 Q32 
DetW 95.01 95.B7 9SJ89tOA! 8SJ29 

99 9584 9581 9583 + (LQl B5 |*+ 

Jon 99 95 JS 95.36 + 0 02 Slii? 

9S ' 1J 9S.I4+OJO 

Dec99 94.90 94.W 94.91 + 002 36J» 

EsLsote; 1 71,163. Prev.sakis 157854 
Prev. open ml) 1,485.847 up 12 , 26 ? 

rFSrnlffian-atstrt 100 pet 

Pi p h ra 11 

P 1 % i!e 1 ^ 

l5£** am - O’*" W-: 3748Wo« S 

Hh|b Low LahM Oiqc OpM J 

Sep 98 93.91 93.85 9389+ 0.01 &930. L_ 

Dec 98 9XB7 93JB3 93B7 + 0© 3 M \ 

Mar 99 9X81 9X76 9X80+afl3 4J0K f 7;: 

Est sales 49,938. Prev. sales: 72804 
Prev. open int : 332,179 up 827 j 



soado lb* - eenre per to. _ : 

Jut 77 7385 7300 Till -0J0 33 JG 

Jal7 7580 7465 7*82 -0U 

Dec 97 75-75 7585 7585 -0.11 27,153 

MerlB 7680 7685 7680 -OI5 4J4S 

May 98 77.B 7784 77J4 -036 UBS 

Esi. mas NA Tin's sides 8.90* 

Toe’s aped ira 7X137 off 507 : 


4J4W0 gal. wnper ear 
JutOT 5480 5X75 5420 -0*2 37J14 

Aug 97 U.15 5483 54-70 —083 19873 

Sep 97 55.90 55.10 5585 -023 98*7 

Oa OT 56-70 56 JO 56J0 -Oil 9814 

Nov 97 5780 57 SO 5735 -0J» &8ti. 

DecOT 5BJ5 5780 5885 -013 1X968. 

Jan 98 58.80 58.00 5885 -013 7.879, 

Feb 98 5X7S 57 95 5880 +0JJ i«3 

Mar 98 5780 56.45 5735 + 037 4871 

Ed. ides NA rue’s, sales 31869 
Tub's open *d 121882 o« »7 


1800 bti- Patton per bbl. ' 

JulOT 2038 2080 20.16 -ttl? 9L941 

Ain 97 20-53 20.12 7033 —All 53863 

Sep 97 2055 20.18 20*8 -0.S8 

OdOT 2050 2020 »41 — 095 W8» 

Nov 97 2046 20-38 2084 +001 T7J81 

Dec 97 70.45 3028 2043 + 004 3XO» 

Jan W 30- *0 2037 3B40 +084 17J54 

Feb 98 2038 20 Jf 2031 -0.07 7JB. 

Ma-48 3U5 2035 303S +006 4Jg 

An-98 2)35 2035 2035 +0.10 4J71 

Ed. soles NA Tin’s, sales 131A60 
Tin's men Int 396,745 aft 7367 


lonaamn Hu's. S per nvn Mv 

JulOT 2.170 1098 2.170 3SJ0I 

Aug 97 2.180 1129 2. IK 32M 

Sep 97 1165 1125 1165 H0JJ 

OaOT 1180 1147 2175 2ft»« 

Nov 97 2J15 1290 2315 

DecOT 1440 1415 1440 123*7 

Jan 98 1485 1460 140 12525 

Feb 98 1400 2370 Z-W 9JO 

MarM 1265 1340 1265 683S 

Ad 96 1120 1105 1110 XSB x 

Es. sales na Toe's, sdes 51817 
Tin's open Ira iwjwi df S51 

eiODSgoi. certs per gal 
-W 97 6135 60 JO 6040 — 1 M 43JH 
Aug OT *038 S9J0 ®.7S — BJ8 13351 

Sep 97 59-55 380 5930 -038 5^ . 

Oaw 57.90 57 60 57.90 —MB JJ* 

NovOT 57 JO 5780 57 JO -ft®* IJS 

Dec 97 57 JX) 5680 5638 -OZ3 4.15) 
Est.sales NA Tucs. soles 25,160 
Tub's men tet 7LS94 all 120 v 

GASOIL (IPE) ■ .. 

UA. dollars uer metric ton ■ feds of 100 tons 
J1MI97 169.50 167.50 16BJ5 -135 17,152 
Jal 97 170.75 16X75 17030 —IX) UM6 
Aliy 9/ 17175 171.50 17150 -1 .00 &2S8 
174X0 17150 174.75 -IjOO 7,«J 
Od97 1 7640 17550 176.75 -13S 5J7? 

Nov 97 178.00 17735 17B3S —135 
Dec 97 17950 17850 17950 — 1.00 75» 
Est.sales; 1-W28. 0pcnlnt4M93eflO5 

U5. do Hare per barret ■ las ot 1JXN barels 1 
July 97 18.97 18.70 1B.72 -0.18 5V*g 
Aug 97 19.11 1858 T8A9 -AI7 

Sen 97 19.19 19.03 19.04 -0.15 ' 

QtJ97 1934 19.10 1911 -013 5W39 

NOV97 1933 19.18 19.14 -at4 WJi 

Dec97 1939 19.18 19.15 -0.15 

Jarrtfl 19.19 19.14 19.12 —0.12 

Feb98 19.13 19.13 WJ6-0H 

Est sates: 35*000 Open Uitl6lVI3 3lip2M 

Slock Indues \ 


500* lrKlc» 

JunOT B46J0 840.70 UtH 

S«9? BS4J0 849J0 M7J0 ^ 

pew eea .90 860.20 saan -*» ^ 

Esr. sales NA Tue^. sates 96001 
Tin’s open ini 199.467 uo 618 


J^^ f 26^0*25923l 26U.0 + lU 3W« 

JUIV7 26210 25995 26110 1 W ,«£ 

Sep 07 2636-0 26145 26275 + 

Dec 97 NT. NT 36470 ♦ 1&D -ir 
Est. sales: 21.769. Open tet_ 69301 off ***■ 


Jim^ “IsvIo^W.O 4552.0 -1 A \ 

97 4621 A 46025 45844) — 1| p . 

DecOT 46594) d659A 4633.0— 3^ ‘ 

Est. sales: 19/. 1 7. Prev. satec .JM5T 
Prev. opanlnt^ 79,159 up UO 

'■? . ; : 

Commodity Indexes 


OtUlOO- Pts&32ndE gdoa pet 3*MONTH EUROURA (LIFFE) 

JunOT 11X13 I12>2* lt3*u~. .11 47 sm lrt_ 1 rntSan - pis of 1 00 nrj 

1 13- 2 112-00 M3^_ ij] JunOT OTj/w!™ ®|9_ ( 

jun yr 1 ij-ij i 14 . 3 * 1 13-03— .11 

sSSot sis «U35 

Bs p Eta? 1 ®# 

m u »ra B 

t'op \ 

rtw pure* 

DJ-Fuluras ,»57 -yf ( 

, £*??**; Motif. A i-sodoM 
inn Financial Fufvrw E*rt>ange> Inn 
Pcmtfeum Erctonpe 

• F it* 

■*' "• » 

■r si 

•- <• .si «: v 

liter issues’ B] 
Market Lower 




PAGE 15 


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* V; .-* » V" “ 

Samsung Unisource to Tighten International Ties 

Warsaw in 
Bank Sale 

Bloomberg New 

SEOUL — Samsung Group 
criticized the Polish govern- 
ment Wednesday for delaying a 
decision on the sale of 
Powszechny Bank Kredytowy 
SA until mid-June, saying the 
move discriminated against 

Samsung and a Polish group 
were competing to buy the bank 
in an open auction. Its value is 
estimated at between $400 mil- 
lion and £500 million. 

Last week. Marek Wagner, 
secretary of state in the Polish 
prime minister’s office, said the 
sale would be postponed be- 
cause the Polish government 
wanted a more attractive offer 
from the Polish group. 

“We are extremely disap- 
pointed by the .delay, which is 
apparently to favor our compet- 
itor,” Kim Suk, treasurer of 
Samsung, said. “It is not a fair 
competition. This may affect our 
future plans in Poland.” 

Mr. Kim added that Samsung 
had not been “any proper ex- 
planation” for (he delay from 
the Polish government 

HSBC investment Services, 
the lead adviser to the Polish 
government on die sale of PBK, 
said recently that a decision on 
the sale of a stake of as much as 
65 percent in the bank was ex- 
pected by June 19. 

But Mr. Wagner said last 
week that the decision would be 
delayed because the government 
wanted to “analyze” the “real 
strength” of the Polish consor- 
tium seeking to buy the bank. 

The Polish group includes 
Bank Przemyslowo-Handlowy 
SA, Kredyt Bank SA, Polski 
Bank Rozwoju SA and Warta 
S A. an insurance company. It is 
likely to be chosen as PBK's 
strategic investor, local media 
have reported, because the gov- 
ernment is trying to strengthen 
the Polish banking system be- 
fore it is opened to increased 
foreign competition in 1999. 

‘'■Hf*;nIbyQurSiqtfFn»n Dijmdia 

HOOFDDORP, Netherlands — 
Unisource NV moved to merge its 
three partners’ international tele- 
communications arms Wednesday 
as the group, a European ally of 
AT&T Corp., sought to strengthen 
its position after the loss of its Span- 
ish component 

But AT&T will not initially in- 
vest its international operations in 
the venture, though a Unisonrce 
spokesman said AT&T might even- 
tually add them to Unisonrce Carrier 
Services AG, the unit that is to con- 
trol Uni source’s international op- 

Uni sourc e, which consists of 
Royal PTTNederlandNV.TeliaAB 
of Sweden and Swiss Telecom PTT, 
said the international linkup would 
better position it to compete with 
olher alliances for the growing in- 
ternational business as the 15 Euro- 
pean Union nations opened their 
markets to competition in 1998. 

But an analyst was less 'enthu- 
siastic. “They’re struggling, and 

ffl\ -UwwUm .. 

FT$E lOfrl&fe*.: i*xsKe&> 

they’re hying to fortify the alliance 
because it really hasn’t been doing 
well,” Mark Fleming, an analyst at 
Andersen Consulting, said. “That's 
partly a function of the complexity 
of having so many partners. ’ ’ 

Unisonrce said integration of the 
networks would attract more busi- 
ness, el imi nating duplication and 
cutting overhead. It predicted that 
the move would lower costs by as 
much as 30 percent, savings it said it 
planned to pass on to customers. 

“The overriding thing,” said 
Paul Smits, Unisource’s president, 
“is that in the new arena it's 
everything to do with being com- 
petitive, having large volumes, ex- 
tremely slim organizations, dealing 
with the newest technology, offer- 
ing extremely low tariffs." 

The entity will have annual sales 
of $2 billion, he said 

Telecommunications partner- 
ships have been shifting as partic- 
ipants jockey for position in a mar- 
ket that CIT Research Ltd. in 
London calculates was worth $3.5 

billion in revenue in 1995 and will 
rise to $14.5 billion by 2004. 

Mr. Fleming said Unisource was 
trying to catch up with its two main 
rivals, which are targeting the grow- 
ing international telecommunica- 
tions requirements of multinational 
companies. The competitors are 
Concert, which is led by British 
Telecommunications PLC and MCI 
Communications Corp., and Global 
One, a joint venture of Deutsche 
Telekom, France Telecom and 
Sprint Corp. 

Telefonica of Spain left Uni- 
source last month when the Spanish 
company joined Conceit 

Mr. Smits said Unisource might 
add another European partner but 
was not desperate to replace Tele- 
fonica. “It’s a pity the Telefonica 
thing happened, but that’s that,” he 

Unisource said the three Euro- 
pean partners would not assume 
equity stak es in one other, because 
only Royal PTT Nederland's shares 
are traded. Telia and Swiss Telecom 

are wholly owned by their govern- 

Shares in Royal PTT rose 3.90 
guilders to close at 74.60 guilders 
($38.41) in Amsterdam. 

( Bloomberg , Reuters ) 

■ France Telecom Sale Backed 

A key France Telecom staff union 
said the partial privatization of the 
company was inevitable and urged 
the incoming Socialist-led govern- 
ment to proceed with the sale, Reu- 
ters reputed from Paris. 

“We hope that we do not have to 
wait too long before the government 
takes a decision, taking into con- 
sideration the future of France Tele- 
com,” said the union, the Confed- 
eration Generate du Travail. “Too 
much time has already been lost, and 
France Telecom is already behind 
on its rivals.” The sale of about a 
third of France Telecom to private 
investors, which was to have begun 
Thursday, was delayed after the So- 
cialists won France’s legislative 
election Sunday. 


l 3600 

h 3400 - ALi 
s 3200 yv " 

. 3000 


1996 ■: 

4800 v 3000 

4600 m 

4400 —jA-f-™' M 

4200 y£ r fe r _, 

4000- :: 

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. Copenhagen Sfepk Market 

HftfefoK: • : • •' rexganerat ■ ' ' Vi" SlTSy 
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Stockholm/ ;syts:, • ; 

Source: Teiekurs iMcmalinnal HrraU Tritninc 

r P^^^,;rCMA 

Stoc*hoft»-' ;s?cte 

Daimler to Assemble Mercedes Cars in Egypt 


CAIRO — Daimler-Benz AG 
will start assembling luxury cars in 
Egypt in November at a new 150 
million Egyptian pound ($44.3 mil- 
lion) plant majority-owned by Na- 
tional Automotive Co., a local Mer- 
cedes-Benz agent. 

The plant in Sixth of October City 
in the desert west of Cairo will pro- 
duce 2,500 Mercedes-Benz E-200s 
a year, executives from the two 
companies said. 

The cars, which will compete with 
locally assembled 5-series models 
from Bayerische Motoren Werke 

AG, will sell for 298,000 pounds, 
said Sami Saad, chairman of the 
joint-venture production company, 
Egyptian German Automotive. 

Industry sources said the price 
was 100,000 pounds less than that of 
the equivalent imported model. 

The local content of the cars will 
start at 40 percent, the minimum un- 
der current regulations to qualify for 
reduced tariff rates, Mr. Saad said. 

National Automotive, a private 
company, holds a 72 percent stake in 
the new joint venture, Daimler- 
Benz holds 26 percent, and 2 percent 
is owned by National International 

Trade, another private company. 
The companies announced the plans 
to investors late Tuesday. 

Mr. Saad said die plant would em- 
ploy 207 workers, with perhaps six 
times as many in the industries pro- 
ducing components. The plant has 
room to install a second assembly 
line, and production could eventually 
rise to 10,000 cats a year. 

HartmulBuehler, a Daimler-Benz 
vice president, said his company was 
attracted to Egypt by “the strong 
economic position, a rising standard 
of living, an open-door policy at- 
tracting investments and the remov- 

al of barriers like import licenses.” 

The venture has not decided 
whether to assemble other models or 
export cars to neighboring coun- 

“The first step is to satisfy the 
demand of the Egyptian market,” 
Mr. Buehler said. “But you can be 
sure that we wouldn't get into such 
an investment unless we thought 
there would come a time when we 
could use this in a wider strategy.” 

Separately, BMW said Wednes- 
day that it would unveil its first 
domestically produced sedan on 
June 18. 

Chief of German CompuServe Unit Steps Down 

Bloomberg News 

MUNICH — CompuServe 
Corp.’s German unit said Wednes- 
day that its chief, who currently is 
battling prosecutors’ accusations that 
he helped distribute pornography cm 
the Internet, was leaving the com- 
pany to start his own business. 

The on-line service, the second- 
largest in Germany, confirmed a re- 
port in PC Magazin that Felix Somm, 

34, had quit as head of CompuServe 
GmbH. Prosecutors are continuing 
to pursue charges that Mr. Somm 
helped to distribute pornographic 
material and other “offensive” ma- 
terial on the Internet, marking die 
first time a government has sought to 
hold an on-line service liable for 
information transmitted over the 
worldwide computer network. 

CompuServe, however, said Mr. 

Somm’s resignation was not related 
to the court case. The company will 
continue to help Mr. Somm defend 
himself against the allegations, said 
Jerry Roest, European general man- 
ager, although he would not say 
whether CompuServe also planned 
to pay Mr. Somm’s legal fees. 

“This makes absolutely no dif- 
ference to us,” Mr. Roest said of 
Mr. Somm’s resignation. “Com- 

puServe and Felix are dealing with 
this together. We feel the charges 
are unfounded and plan to defend 
against them vigorously.” 

The on-line service, the second- 
largest one in die United States as 
well, has about 300.000 subscribers 
in die rapidly growing German mar- 
ket. The largest Internet access pro- 
vider in Germany is the phone com- 
pany Deutsche Telekom AG. 


Wednesday,, June 4 

Prices hi local amendes. 

High Law dose Pm. 

Amstertam *KKEK!« 

XJD asjfl 3190 3430 
Aegon 14430 145 146 14150 

AMO 14730 14530 1a4«I 14730 

AkaNoM 257JO 2SL® 25138 25530 

BotnCa 120.® 11730 11930 111 

Bab Mss am 3440 3630 3630 3SJ8 

CSMaw . 10030 90.90 9930 W3Q 

_ " 308 389.50 38950 

191 18830 WBJ0 19030 
32.90 3230 3230 3230 
82 8040 81.10 81 JO 
46 6530 
6530 6630 6470 6540 

93 M 
333 32830 332 37&J0 

Hoogmnsm 10660 99.10 1M.10 98.90 

fenTpoogte 16930 16739 14030 169 

8830 0739 88.10 87 AO 

56 5536 5533 56 

41.10 030 6040 4040 

<7 4730 
303 30230 
257 256 

117.90 M3l70 
9650 92JP 9120 9220 

V!} 20330 198 

175 175 175 

6130 6080 61.18 61.10 

181 181 
lll-« 111.40 
37240 37730 
374 37428 378 

VeataM 115.90 11230 115.70 112 

„ 65 4Z70 

WafcaUcH 23620 23230 234 233J0 






Bab Mss an 







G- Bacon 




nun LWQVKr 









Mr Mo 5* 



5SS£? f 


4730 46® 
30330 30129 
25830 25"'" 

119.10 II 

9650 922! 

205 m 
17770 ITS 
6170 6080 
18130 T*1 

111.70 111 
39030 376 
27940 374 

115.90 11230 
4570 4340 
23620 23230 


Deutsche Bank 9870 
DeutTetefcuai 3935 
Dresdner Bank 6230 
Ftwenk* 35930 
Fiesenhis Med 15930 
Fried. Knipp 330 
Gefae 1W40 

HehMbgZml 148 
HaAripM 9735 

Luflhmw 2970 

MAN 514 

Mannesman 739 

Meba 19130 

Munch RueckR 4565 

Pmssog *6530 

RWE 75.40 

SAP pW 318 

5dwring 17930 

SGL Canon 24075 

Siemens 98J0 

Springer (Asfl 1510 


Thyssen 412 

Vena 9830 

VEW 523 

wg M 

Vnawagen II7B 

98 9865 
3845 3830 
6130 6205 
355 35B 

15580 157 

322 32930 
13330 12330 
165 166 

95.90 96 

«3 483 

7430 7470 
6740 6835 
614 616 

74 74 

1228 1230 
2970 2930 
51130 51130 
733 733 

3635 37 

189 19T 

4480 4562 

463 46530 
74M 7575 
315.10 31670 
17770 179 

260 26030 
97.97 9&40 
1510 1510 

925 930 

m mjo . 
9730 9830 
520 525 

281 78530 
lie U75 

High Law Ona Pm. 

SA Breweries 13075 12875 130 12775 

Senator 4975 «75 4975 49 

Sasol 5675 5530 5630 5530 

SBC 214 210 71330 210 

Tiger Outs 77 7630 76.75 7630 

Higli Low dose Pm. 

High Law aasa Pm. 

High Low Oom Pm. 

Kuala Lumpur cqa»qsitem?-a 

r Pnrtow: 112633 

AMMBHdgs 1630 1670 1640 16.10 

GenHag 1370 13.10 1110 1370 

AMBonkfcig 28 2(75 Z77S 2730 

Mol Ml Ship F 635 5.90 5.95 6 

Pet ros Gas 945 975 9A3 9.40 

Proton 1110 1270 1190 1190 

PubfcBk 408 198 4 410 

Renaag 176 330 338 378 

Resorts Worth 870 845 BL45 830 

Rothman* PM 2730 2630 2675 2775 

8.15 875 

1160 1240 
1170 12 

2070 2070 
970 9.10 

Stow Darby 
Telekom Mol 


FT-5E 100:4557.10 
Pravion: 4557JI 

WPP G roup 




Agues Bwceton 





Ekdrnhn B 



457 45630 






Ericsson B 


277 27730 279 





Platan 262439 

Hernia B 



254 255 





fetenllve A 



693 693 






8* 834 839 849 

17140 147.90 148.90 171 

Investor 8 



38530 38730 








24030 23830 





Bai Santander 



Abbey Natl 035 875 

A»W Danccq 448 433 

Antfai Water 675 434 

Aigos 618 &n 

Helsinki HEXGtajongtaggTo 

SET tadwe 5S2J7 
Pmtaak 55637 













































Mafia A 

Metro B 

Mebo-Sata B 


Nokia A 





4430 4650 
227 223 

Argos 618 610 

Aids Group 173 170 

Assoc Br reads 531 572 

BAA 545 578 

Boedays 1137 1138 

Bass 777 731 

BAT tod 545 530 

BanfcSarftand 376 362 

Blue Cade 412 405 

BOC Group 1072 10il9 

Boob 7.10 694 

BPBInd 335 331 










77 JO 


Brit AirtHi’fi 




17 JO 










147 14750 














138 136* 





34750 344* 34430 






214 210* 



Bril Telecom 




103.10 102* 







118 11830 11940 
8970 9040 94 

Hong Kong h^s gwu. 


tarn 20 todn: 386142 
Pnuten: 3838JS 

) 88625 WTO . 884 
1 1210123975121150 

1 42730 42775 428.75 
I 92 9275 92 

I 47575 480 47730 

S 281 28175 287 

} 30175 304 30175 

i 32050 32130 31975 
) 1875 l&a 1830 
i 39975 401 <7150 

ptaieiwi 22KL77 

) 15900 15975 1MB 

I 6300 6340 - 6310 

I 9750 9760 9820 

i JZ50 3290 3075 
] 14350 14425 M3S0 
) 1B» IfM 

! 5S SS § 

! SS S S 

I 575B S8BB WO 
I U87S 14150 14075 
; 1475k 14925 14900 
» 51SS3 17300 lim 
I 4870 4970 4990 
i mi Mwnut 
i 32BS DM 3305 
t 71*75 21700 p « 
I 15475 15525 13575 
| tOSO 96450 96450 

Cheung Kong 
Don Hess fik 
Hang Long De* 

i uihum 

Hen d a no n Ld 
HK Chino Gas 

MX toMC 579a 

HJSi. -MiM ■ i'O 

M ii.< + t>4, < 

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tf. A-Jg M A T 

w . *.*•■ ted*- 1 <4# « 

E - t*.*. _j* 



i * i-. •* 

8' ‘*S4* *5^ -• **. } - 

215 3X3 

385 375 

915 MB 

399 an 
niffi awn 

236000 235000 

no no 
no 199 
990 96730 
336 221 JH 
366 399 

' 3M 343 

• 3U> 30* 

77i m 
980 H 
398 392 

632 as 

339000 337662 
235470 234765 
Ittfi U» 

ns m 

no no 

96730 98173 
335 zn 
363 3 60 

3 U 3 tf 

■ »- — ■ 

Hyson Dm 
J ohMoa0Hhg 
Korry Props 

OrieoM Press 
SHK Props 
Shun TakHdsx 
Sth China Pad 

Jakarta c 

Astro bd 7173 

Bk ton total 1975 

Bk Negara WS5 

hmnmn . 5625 
tadasat 7300 


T iM t uu— o al 4075 

BAD 870 
27.95 28.15 
11-BO 11A5 
7930 78 

24JB 2640 
S3 42i8 
4870 4770 
41 A0 42 
1030 1048 
14.90 14.90 
9275 9130 

7475 7425 
1195 UK 
2970 29J15 
17j 05 17>tS 
rm 4is 
229 227 

6475 6475 
25.10 2530 
2270 2270 
1930 1970 
4930 4930 

M3 zm 
233 270 

9625 9575 
575 575 

9.1® ME 
770 7.15 

6975 68.75 
3530 36 

1930 19jOS 

Bwadi Costrol 1036 1076 

Burton Gp 172 178 

Coble Whetas 498 486 

CodbwySdw 575 570 

CarttanComm 575 5.18 

Cisnml Union 677 633. 

Compass. Gp 674 667 

Courtookts 332 334 

DhOftS 495 462 

EteChOCanpoowilS 403 3.97 

EMI Group 1132 113 

Energy Group 5L52 531 

Enlespfteofi 702 679 

Font CDianU 133 131 

GarlAcctdeol 9 80S 

GEC 337 372 

GKN 1033 11X19 

GhnoWeaanw 1210 1137 

Granada Gp 835 83D 

Grand MeJ 575 £61 

GRE 271 274 

SwenahGp 467 460 

Gutaess 578 £69 


ikfart muojmlm 


k. 1425 73)9 QI9 UBS 

191 H93B 190 0620 
hm m m 36650 
^ UN M p W 

■e 2938 3978 3930 S 

x a uita 6430 

*!9»m 5438 5470 M35 »g 

HMtoNb AW 7U8 727* 71.95 

teT* -4*47 18.0 6UB 
W «U| 9U0 fis 040 

I &M am A 

101 UBS U22 UBS 

sa ns is wtrss 

12938 335 U 4 » 13378 
to 85.19 UI 9 KN 8*80 

«H0 6925 • TWO 
1915 1925 1® 
1600 1625 IP 

10450 10(75 MS7S 
2975 2975 3000 
3525 5525 5900 
7225 7300 7225 
9950 9975 9980 
5500 5500 5425 
3975 4000 4100 


BkS 2835 27.95 2805 28 

* H138 SITS 29130 SIX 
27MD 2jg2*9^ 268» 
30Q 300 300 303 

195 18875 191 18830 

16W 1580 1580 16 

seen wus 4850 4850 
SS 25 2535 25 

M2 MOJO 16U9 S® 
37 3*75 36*0 37 

3S40 35 2S3S 35 

2075 19.90 7030 20 

iM in iu 
M fUiwa 57 wr; 567S Ssjs 
- 3050 JUS ®7S 3075 

115 2.12 112 110 


ana , 






5630 5775 
349 34175 
12530 12675 
1775 1730 
104 10550 
1810 M3S 
18 89 

45 W 46 
61 6275 

GUS 639 676 

S B:H,a - ’S 

bapl Tobacco iu 151 

Klngflslror 770 739 

Uxibroto 151 143 

Lead Sec 8X7 875 

lagan 2 jO 7JD 

LetaGodOp 444 437 

UayrisTSBGp 597 579 

Lucas VOtfiy 1J6 132 

iu h 

Moony Asset 1160 

Notional Grid 13] 279 

Nadi Power £89 £fil 

NTOWcsl 737 770 

Ned 7.18 7.05 

Orange 112 238 

P&D 649 633 

Punen 7.17 775 

PdUngba 175 170 

POMfGaa 637 630 

PromteFtenifl 465 455 

PnHtonttDl 613 6 

(UfinxkGp 847 868 

Rtat Group 432 471 

ReekBCdm 832 837 

Bedtaad 134 323 

Reedtnfi 602 £93 

ReatakBtaU 273 278 

StbtoaHdgs 487 473 

Roan 2.77 166 

RMC Group 9.W 9 

RofilRwa 143 276 

figmlwScal 895 880 

RUnn 1046 tOTQ 

Ran] 4 Sen AI 466 458 

Sowraiy 146 140 

Soktewry 155 138 

Sdeodws 17 1671 

SmtNewensfe 495 473 

Scot Power an 143 

SKBrinr Z87 2X3 

Sown Tied IM 772 

SbetTronspR 11J« UJn 

Sclie 932 977 

Sadlh Nephe w L» 

SotofiOm VIM 

Sflflhstad 735 

SttnOoc 411 

S toge t Bodi 490 

Tesco 166 

Thanes Water 487 

31 Group m 

T1 Group £62 

Toafidns IM 

Unfieaer MJfl 

utdAseaODOt 477 

imitan 7JU 

m3 tlBsie* 695 

840 841 

431 435 

664 677 

611 615 

170 170 

577 £31 

578 £30 
1178 1142 

749 776 

£40 £40 

172 343 

407 406 

10-18 10.15 
7-ID 704 
132 134 

1842 1041 
178 07 

493 494 

£27 £27 

£18 575 

642 673 
647 673 

3L37 133 

488 482 

197 198 

1142 1146 
£42 542 

689 6B4 

142 141 

893 889 

135 136 

103* 1030 
11.99 IMS 
840 840 

541. £73 

174 im 

461 464 

£73 £71 

633 628 

532 £52 

18.01 1775 
874 816 

178 172 

7.09 7.16 

248 244 

683 IBS 
241 244 

439 435 
5J9 £80 

142 134 

£09 5A4 

£11 £15 

1133 1158 
271 124 
£05 SM 
736 773 

7.13 7.14 
lie m 
642 647 

7.13 7j06 

175 1.19 

650 652 

463 499 

607 6.12 

645 642 

417 429 

877 840 

129 377 

597 598 

278 229 
681 675 

247 275 
9JJ6 9Sff 
239 2J9 

288 882 
1036 1032 

344 14? 

153 151 
1689 1695 
673 692 
165 169 

283 284 
772 781 

1188 1195 

3 K 

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Gas Natural 




Sevatana Elec 
Vrrienc Cement 


Ayata Land 
EroPtdlp 111 
CAP Homes 
Mania Bee A 
Metro Bate 
PCI Bank 
PM Lang CM 


Ada A 
Cemex CPU 

Erep Modems 




Ktofi) Clark Mex 



Aleanro Assjc 
B caCamn IM 
Bca Rdeuraai 
BcacS Rooms 
B enetton 
Cmflta ItoBana 

Gown! Assic 






Mctfiedb o n 








Tetoam Ifcfa 


Ba Mob Coro 
Cdnllffl A 
Gm Metro 
a -Wn tLtaa 


QuebaoorB _ 

1855 1817 1850 1818 

Pravtou; 55667 

5500 26280 25500 
1775 1780 1800 
5770 5810 5830 
7400 7540 7500 
0500 10630 10540 
1495 1510 1495 
4010 34390 24300 
4670 4745 4675 
0960 31200 31450 
2810 12B«) 12850 
5150 5360 5100 

Z720 2770 2710 
im 7450 7388 

1220 11260 11290 
1280 1295 1295 

8210 28900 28900 
1725 1740 1740 
3600 2630 2700 

61)0 6300 6190 
1380 1395 1395 
7110 7300 7400 

4195 4215 4215 

1275 1285 1285 
2050 2070 2060 
PnetatME 288278 

1930 1975 19.75 
2175 31 -SO 21 
155 157 158 

10 10 10 
9130 92 9230 

550 555 575 

7.10 7.10 770 

260 265 36230 

780 795 795 

7730 78 7830 

730 730 770 

Boha tehee 410948 
Prestons: 404036 

4835 4835 48.10 
1776 1870 1836 

30.90 3170 3070 
1272 1274 1272 
3935 39.40 39.40 
4675 46.90 4770 

174 ITS 173 

27.90 28JM 2730 
27-40 29.00 2730 

11 £40 110JU 116-40 
18,10 1838 1738 

MlBTeteroalfeae 1226600 
Prewxa: 1223U0 

1110 10900 10960 10905 
□95 3330 3360 3305 

1550 4385 4385 4450 

20B 1186 1186 1204 

m . I 23258 23400 23750 
E570 2543 2555 225 

930 7330 7800 7920 

1735 8620 8640 8650 

740 5670 5710 57181 
•150 7Sm 28950 29950 
085 14855 14965 14820 
USD nm 13® 7380 

310 5160 5160 S39-S 

am ms 7300 jm 

•Via 971B 9850 9780 
062 1057 1060 1057 

499 480 480 4B3 

[475 2450 2460 2445 

B35 3780 382S 382S 
□85 13170 13170 13170 
□00 18000 18245 17750 
1015 10890 10940 10955 
1640 8S85 8613 8600 

1685 4M 4670 4655 
tlllS 5100 5UD 5105 

lettosMoto tetee 329039 
Pteritote 326492 

JO 43 43 4370 

3» 2K SU 
3£30 3535 3570 35-40 
3625 36 36 1535 

17M 17% I7M 1735 
29% 29 29% m 

3970 39-40 3935 3935 
2870 2BM 2ftft 2&3S 
19-® 19U 1970 1975 

1&60 l&S 1635 1675 

» m m ass 

a 7 % 

OKI tatoC 64171 

13530 136 136 

14830 169 17130 

3430 2430 2470 
2X30 2830 SS 
W 139 140 

44 4430 4430 
£ &4930 

22 *6 365 

Si 232 255 

ito im fin 
«* «3 624 

FI 3,4 312 

W 14150 14650 
139 VO 739 

J]£ 517 SOS 

4530 46-40 4130 







C anal Ph is 
Christen Dior 
CLF-Deda Fran 
Cradl Agricole 






Uroa Eaux 
Midiefti B 
Poitoas A 
Pernod (ricard 





927 903 927 910 

636 612 619 630 

345 34070 34030 34430 
677 662 675 671 

918 891 907 886 

235 22£90 227 23070 

1033 993 1024 997 

3909 3855 3880 3710 
27230 27070 27230 272 

24030 235 23730 234JB 

m 645 655 


1255 1275 
911 901 

Scania B 

S-E Ban ken A 
SkantOa Fare 

Spaibateen A 
S&dsbypolek A 

Sv Hamflej A 

2« 235 238 239 

273 268 268 27130 

210 208 207 

222 219 220 22130 

169 164 165 16730 

8330 8130 82 8150 

780 268 277 260 

319 31730 31830 31730 
17730 17530 177 175 

15430 15130 1543A 153 

190 190 190 190 

11530 11430 11430 115 

219 21430 219 21£58 

21830 215 21530 21530 

19930 38890 
784 765 

167 JD 357 

1Q2B 988 
2225 2168 
1456 1431 


6.10 6.10 
703 694 

39460 38990 
780 7 55 

36570 358 

1010 995 

2196 2181 
14S0 1440 
556 553 

329.3 317 32730 319-Si 

361 35420 35730 35630 
293 28570 285-0 290 

562 546 557 565 

2485 2420 2420 2470 

2064 saw 2015 2067 

135 129.10 133.® 12970 
1609 1561 1606 IW 
204 18730 199.80 10930 
518 49730 516 499-30 

299.90 295.10 29730 298 

1122 1050 1® 1050 

5G5 Thomsen 



469 479* 

Ste Generate 



! 990 









1 798 





1 289* 287* 


Thomson CSF 

696 6ft 
1* 15X3 





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3* 34031 

347 345* 






Brambles IntL 
CC Amato 



Fasten Brow 
Goodman Rd 
iCI Australia 
Land Lease 
Hat Aost Bank 
Nat Mutual Hde 
Hews Corp 

Podfic Dunlop 
Pub Broadcast 

St George Bate 

AlOnlnortoK 261598 
Piwtoasi 161248 

I 834 836 835 

I 8.85 838 9.12 

I 1836 1897 1837 
402 408 412 

1 23-43 2343 2330 
i 14 1427 1396 
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I 7 JO 7J2 7J9 

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i 232 233 234 

I 174 178 174 

i 12.12 12.15 12.14 
i 2644 2635 24® 
I 136 136 1.92 

Very briefly: 

• Italian authorities withdrew a proposal to grant 7.7 million 
European currency units ($8.7 million) in aid to Olivetti SpA 
for a project to develop portable multimedia personal com- 
puters, the European Commission said. 

• Greek and Italian national telephone companies are team- 
ing up to seek a major stake in Serbia's telecommunications 
company, according to the Greek company. Hellenic Tele- 
communications Organization SA. 

• France Telecom and Telefonica de Espana SA are can- 
didates to buy the Moroccan telecommunications network. 
•OCP Construed ones SA and Gines Navarro Construc- 
dones SA plan to merge and form what would be Spain's 
third- or fourth-biggest building company in terms of sales. 
The combined market capitalization of the two companies is 
about 77 billion pesetas ($528.7 million). 

• Accor SA, the world’s No. 4 hotel company, said George 
Soros had raised his stake in the company, and it predicted net 
profit and earnings per share would double by 2000. Accor 
said the international investor raised his stake to 2. 1 percent in 
May from 1 percent. 

• NFC PLC. the British moving company that owns Allied 
Van Lines, said it would take a charge of £49 million ($80 
million) to revamp or sell some of its businesses in Britain and 
Continental Europe. 

• Compania Vinicola del Norte de Espana. a Spanish wine 
producer, plans a public offering and a capital increase. 

• Philips Electronics NV is holding talks with banks about its 
plan to sale its French unit Philips Photonique. 

• Italy’s consumer prices rose 0.3 percent in May from April 
and 1 .6 percent from a year earlier, confirming the county's 
lowest inflation rate since 1969. 

• Compagnie de Suez, which is to merge with Lyonnaise des 
Eaux SA, said it aimed to keep at least a 50 percent stake in 

Tractebel SA of Belgium. Reuters, Bloomberg, AFX 

The Trib Index ***** 3*0 pm 

Jan. 1. 199?- IOO. Lmral Chong* % clung* yoarto data 

% ctiango 

World Index 165.65 -0.5B -0 35 +11.07 

Regional Indexes 

Asia/Pacific 125.03 +0.22 +0.18 +1.30 

Europe 172.56 -0.19 -0.11 +7.05 

N. America 191.25 -1.65 -0.86 +18.12 

S. America 155.64 -1.17 -0.75 +36.01 

Industrial Indoxas 

Capital goods 200.38 -1.82 -0.90 +17.24 

Consumer goods 186.01 -0.79 -0.42 +15.23 

Energy 196.66 -0.60 -020 +1521 

Finance 123.66 -0.15 -0.12 +6.18 

Miscellaneous 168.79 -0.44 -026 +4.33 

Raw Materials 181.43 -027 -0.15 +3.45 

Service 157.73 -0.14 -0.09 +1426 

Utilities 143.09 -0.52 -0.36 -026 

Ths ImemitKxrt Horakt Tribune World Stock Indo* e tracks tha US. doBar values of 
2B0 imemationaiy hmstabto stocks Iron 25 countrfoa. For mum HamwUon.a bee 
booklet is avaUablo by msng to the Trib Max, 181 Avenue Charles do QatOe. 

SR521 NauBty Codex. Franco. Compded by Bloomberg Nows. 

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Indians Toast Prohibition’s End 

State Lifts Alcohol Ban Because It Cost Too Much 

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Australian Growth Rate Slows 

A Sydney futures trader gesturing on the trading floor 
Wednesday; the government said gross domestic product 
grew at 2.4 percent annually in the first quarter, the lowest 
rate in five years. The data raised hopes for an interest - 
rates cut. but the stock-market reaction was subdued The 
All Ordinaries index rose 23 points, to 2,615.90. Many 
analysts said the GDP data were within expectations. 

Seoul Seeks More Transparency 

Bloomberg News 

SEOUL — The government plans to require conglom- 
erates, or chaebol, to publish statements designed to give 
bankers and investors a clearer view of their overall finances, 
■ an official said Wednesday. 

Current consolidated statements often do not clearly depict 
; their situation because chaebol are linked by family, not com- 
pany, ownership. “We need combined financial statements 
which show cross-investments among individuals, not compa 
. nies," Kim Byung Hwan of the Finance Ministry said. The 
- y-move comes in a difficult period for some chaeboL The Hanbo 
~ ! u andSammi groups have collapsed this year under massive debts, 
the Jinro and Dainong groups are negotiating bailouts, and 
T-fanshin Construction Co. was declared bankrupt this week. 

Bloomberg News 

BOMBAY — It wanted to help fulfill M ahatma Gandhi’s 
dream of an alcohol-free Lidia, but the southern state of 
Andhra Pradesh just couldn’t afford prohibition anymore. 
Last month, it lifted a two-year ban on alcoholic drinks so it 
could raise money by taxing them. 

“The citadel of prohibition has fallen, and normal life has 
resumed.” said L.N. Barra, secretary-general of the All India 
Distillers Association, an industry organization of 230 spirits 

Andhra Pradesh’s decision to end prohibition means that 
Indian brewers and distillers, including United Brewers Ltd., 
McDowell St Co. and Shaw Wallace Ltd., will get a boost in 
sales from the state's drinkers. It also makes it less likely that 
other states will try to close their spigots. 

Even with five of India’s 26 states still prohibiting alcohol. 
India's $3 billion market for alcoholic beverages will prob- 
ably grow more than 7 percent a year for the next five years, 
analysts say, as the drinlang population is growing and India’s 
burgeoning middle class is spending more money on hi ghe r- 
priced alcohol. 

United Breweries, India’s biggest beer and whiskey maker, 
says its earnings will return to normal this year as Andhra 
Pradesh's citizens — the populous stale whose capital is 
Hyderabad used to account for one-fifth of India's alcohol 
consumption — start drinking again. 

After United’s earnings fell 45 percent In the year that 
ended in March, sales and profit should rise more than 10 
percent this year, according to P. Krishnam urthy , president of 
group finance and corporate p lanning . 

“This year.” he said, “should be a lot better.” 

In volume terms, more than 80 percent of the market is 
taken up by potent “country liquors” that cost as little as 10 
rupees, or 3 cents, a bottle, these murky drinks are made from 
rice, molasses and even cashew nuts, depending on the region, 
and can have as much as 80 percent alcohol content In the 
state of Karnataka, the local liquor called “patta” is brewed 
with pieces of old tires to add an extra kick. 

The local spirits are made by thousands of small companies 

and comer shops. The biggest companies are the ones making 
and selling Western alcoholic beverages. 

Weston alcohol, including beer, whiskey and rum, has 
grown to a $13 billion market in India, leading foreign compa- 
nies such as Carlsberg AS, Anheuser-Busch Cos. and Whyte St 
McKay Ltd. to set up shop in hope of tapping a new market 

It is not an easy market to crack, so most companies have 
joined forces with local brewers. Each state has its own 
regulations and taxes on alcohol production and sales and may 
even charge “import” duties for alcohol broughtin from other 

Foreign makers say it is worth the trouble, though, because 
of the huge growth potential for Western alcoholic beverages. 
Expressed as a national average, Indians drink only two mugs 
of beer a year. That leaves lots of room for growth in 
comparison with the United States and Japan, where the 
average person downs more than 200 times that amounL 

“Internationally, growth is going down, but in India that’s 
□ot true,” said Lalit Khaitan, managing director of Radico 
Khaitan Ltd., which makes nun and whiskey in Delhi. 
“People are going for better-quality products, so we feel that 
that market will increase.” 

When India gained independence in 1947, Gandhi's home 
state of Gujarat was the first state to ban the production and 
consumption of alcohol. Many politicians still campaign on a 
prohibition platform, focusing on the problems of alcoholism 
in rural areas and deaths and injuries caused by country brews 
gone bad. 

Mr. Barra of the Distillers Association said more than 3 ,000 
people had been blinded or killed in the past five years by 
country liquor that was too strong. Half of the market is illegal 
and unregulated, he said. 

But prohibition has had its victims as well. Inertia Industries 
had to end production of its popular Sandpiper beer last June 
when the northern state of Haryana went dry, closing its only 

Going dry, though, is a hard decision for most states to 
swallow. Duties on alcohol make up as much as 23 percent of 
some stales’ revenues. 

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Jakarta Issues ‘Buy 5 Order on Car BJL Arrests 4 

cme^tpo»s«tf^i>ortaHr3 p lans of government institutions. He did not At* iVlBlIJSpClpCf* 

Cimp/ln/by Out Sag Fnw Lhspakitrs 

JAKARTA — The government has 
ordered all state-owned enterprises and public 
offices to buy cars from PT Timor Putra 
Nasional, which is partly owned by President 
Suharto’s youngest son, the minister of na- 
tional planning said Wednesday. 

“It’s been in effect since die middle of 
May,” the planning minister, Ginandjar 
Kartasasmita, said of the requirement. 

The minis ter of trade ana industry, Tunky 
Ariwibowo, was quoted as saying the dir- 
ective would bolster flagging sales of the 
Timor, known as the “national car” even 
though it is manufactured in South Korea. 

"We have to support the program from all 
sides so the project can be finished as soon as 
possible,” an Indonesian newspaper quoted 
Mr. Tunky as saying, ‘ ‘so don’t be surprised if 
you see me driving one to work.'’ 

Mr. Tunky said he had sent a letter of 
notification to the National Development Plan- 
ning Ministry, which oversees the purchasing 

plans of government institutions. He did not 
specify how many vehicles would have to be 
purchased. Timor Putra, which is controlled by 
the president’s son Hutomo Mandala Putra, 
has been at the center of a trade dispute with 
American, Japanese and European compet- 
itors. The Timor is exempt from the import 
duties and taxes that add as much as 50 percent 
to the price of a car bought in Indonesia. 

The World Trade Organization’s Dispute 
Settlement Board is to consider a complaint 
against Indonesia over the national car policy 
next Thursday. But even with its tax ad- 
vantages, the Timor has not sold as well as the 
government hoped. Since October, 12,000 
Timor sedans have been imported from South 
Korea, where the car is manufactured by Kia 
Motors Corp., a joint venture partner with 
Timor Putra, weU short of the company's 
sales target of 4,000 a month. Jakarta ordered 
13 banks last month to lend $690 million to 
Timor Putra to help it complete its domestic 
production facilities in 1999. (AP. AFP) 

Can/Klnl by Ow Staff Am Dkp&chn 

HONG KONG — The In- 
dependent Commission 
Against Corruption said 
Wednesday it had arrested 
four employees of Hong 
Kong Standard Newspapers 
Ltd. and two former staff 
members in connection with 
what it called a plot to ex- 
aggerate circulation of the 
company’s newspapers. 

A source close to .the in- 
vestigation said one of those 
arrested was Sally Aw Sian, 
chairman of the parent com- 
pany, Sing Tao Holdings Ltd. 

the commission said the 
operation involved the reg- 
ular printing of more than 
10,000 extra copies of the 
newspapers. (Reuters, AFP) 

Source: Telekurs Imencuioiul Herald Tribune 

Very brief ys 

• Two former Nomura Securities Co. managing directors, 
Nobutaka Fujikura and Shimpei Matsuki, were charged with 
violating the commercial code and securities laws in the 
alleged payoff of an extortionist. Osamu Fujita, another former 
executive, was released and is not expected to be charged. 

• SBC Warburg Securities Philippines Inc. said its top 
analyst, Joey Salceda, had resigned after regulators started an 
investigation into charges that he had a secret trading account 
at Sapphire Securities Inc., another brokerage. 

• Japan Air Lines Ca’s debt rating was cut to A-2 from A-3 
by Moody’s Investors Service Inc., which said the carrier’s 
high costs threatened its future. 

• Dai-Ichi Kangyo Bank Ltd. said three of its money-man- 
agement affiliates, Asahi Investment Trust Management 
Corp_ Kankaku Capital Management Co. and Dai-Ichi 
Kangyo Investment Management Corp., would merge Ocl 
1 to form Dai-Ichi Kangyo Asahi Asset Management Col, 
which will manage 2.40 trillion yen ($20.54 billion) of assets. 

• Beijing Yanhua Petrochemical Co_ the largest Chinese 
maker of resins and plastics, plans an initial public offering 
valuing it at as much as $988 million. Most of the stock will be 
in the form of American depositary receipts representing so- 
called H shares, which trade in Hong Kong. Bloomberg, afp 

Amatil-San Miguel Deal Sweetened 

Bloomberg News 

MANILA — Coca-Cola Amatil Ltd. of Australia sweetened 
its offer to San Miguel Corp. on Wednesday to tty to close their 
agreement to create the largest non-U.S. Coke bottler 
San Miguel now would be given four of 16 Amatil board 
seats, rather than three of 15 seats. San Miguel still will receive 
a 25 percent stake in Amatil in exchange for the soft-drink unit, 
a stock swap valued at $2.7 billion. The move came after a 
Philippine government agency that has a big stake in the 
Philippines' biggest beverage producer called for a renegotiation 
of the terms for selling Coca-Cola Bottlers Philippines Inc. 

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Hhai Hating Service to Downgrade Banks 

CagfitJbrOw SiiffFntn Disju&rka 

r BANGKOK — Thailand’s 
iocs! credit-rating service 
said Wednesday that it would 
.lower its ratings on all the 
country’s banks and finance 
' companies to reflect the be- 
leaguered state of the Thai 

Vuthiphong Priebjrivat, 
° president of Thai Rating & 
Information Services, said the 
downgrades reflected a 
’ squeeze on earnings and cash 
flow among lenders caused 
• by loan defaults, particularly 
by property developers. 

The downgradings may 
pull the debt ratings of at least 
two finance companies. 

Cathay Finance & Securities 
PCL and Thai Thamrong Fi- 
nance PCL, below investment 

The U.S.-based rating 
agency Standard St Poor’s 
Corp. said, meanwhile, that it 
had cut the long-term credit 
rating of Industrial Finance 
Corp. of Thailand to A-minus 
from A. 

The company’s stock fell, 
closing at 43 baht ($1.73), 
down 1 . as Thailand's bench- 
mark stock index fell 3.70 
points, or 0.7 percent, to 
552.87, its lowest level in 
more than six years. 

For Thailand as a whole, the 
lowest economic growth rates 

in 1 1 years, tumbling property 
and stock pices and failing 
exports have pot considerable 
financial stress on the econ- 
omy. In April, Moody’s In- 
vestors Service Inc. down- 
graded the country’s long- 
term sovereign rating to A-2 
from A-3, citing the govern- 
ment’s plan to aid property 
and finance companies. 

S&P has not altered its rat- 
ing for Thai sovereign debt 
But the decision to down- 
grade Industrial Finance 
Corp.’s, of Thailand’s rating 
“may indicate a gradual 
change in opinion by S&P on 
the Thai sovereign rating,” 
said Jason Brown, a fixed- 

income analyst at Bear Ste- 
ams Asia Ltd. 

Separately, a top official 
said Bangkok would invite 
commercial banks to join a 
low-interest-mortgage pro- 
gram aimed at reviving the 
property sector after home 
buyers nearly exhausted a 173 
billion baht fund in two days. 

Thousands of home buyers , 
rushed to take out loans, of- 
ficials of the Government 
Housing Bank said, and 
Deputy Finance Minister 
Thawatwong Na Chian gmai 
said banks should help ex- 
pand the fond to resuscitate 
the sagging property sector. 

(Bloomberg, AFP) 

Union Bancaire Privee 


■i ff % ^ 

it |- i 

if. f- % 

RULES: Exchanges Seek a Cut in Regulations Burma Lists 

* ; -• 

Jc V 

Of IT . . 

£ 5 * 

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I., u r.: 

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K- •- . r 

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Continued from Page 13 

could be lost to consumers 
and businesses. Pricing at the 
service station and the gro- 
cery store, the prices plumb- 
ers and electricians pay for 
copper pipe and wire — all 
are profoundly affected by the 
price-setting mechanism of 
the exchanges.” 

She said that the regulatory 
freedom the futures markets 
sought would result in “grave 
dangers" not only for market 
participants but for the public 
at large, whose pension 
funds, bank deposits, insur- 
ance accounts and mutual 
. . funds would be put at risk. 

. The friction between the 
exchanges and their watch- 
dogs at the commission is 
nearing a critical point. 

Bills now before the House 
;.‘of Representatives and the 
: Senate would eliminate most 
, record-keeping and audi t in g 
. requirements, speed approval 
‘ of trading in new contracts, 
' lift marg i n limits and create a 
“pro fessional market” of 
* largely unregulated big 
. traders. The commission 
would be left with power to 

S violators but few tools 
eciing them. 

Intense closed-door lobby- 
: ingandnMotiations about the 

' t5ts have been under way for 
several weeks. 

■ Exchange officials cite 
.statistics showing that off- 
'ratter trading in ctureacies, 
insuea-mt swaps and 
!' USwadoflais has grown three 
S. ' .to H) times as rapidly as that 
: l »the«tdi»i^es. 

Thomas Donovan, 

change had fallen in the past 
two years while over-the- 
counter trading in interest- 
rate swaps, which are similar 
hedging products traded 
privately between two parties, 
were commanding a growing 
share of the corporate risk- 
management market 

The reasons are simple, Mr. 
Donovan said: the commis- 
sion’s * ‘oppressive” rules and 
its “protectionist” mindset 

Ms. Bom acknowledged 
that a large volume of de- 
rivatives trading had shifted 
from American exchanges to 
overseas markets, whose reg- 
ulations were not as restrictive 
as those in the United States. 

But as a result of recent 
problems, financial regulat- 
ors in other countries are now 
looking at ways to strengthen 
their power. 

In Britain, Gordon Brown, 
the new chancellor of the Ex- 
chequer, has said that secu- 
rities self-regulation is insuf- 
ficient to protect the public 
interest He. is proposing ways 
to enhance fee government’s 
ability to police markets. 

Regulators in France, Ger- 
many, Japan, Hong Kong, 
Sin g a p ore and elsewhere are 
meeting regularly to draft 
global rales governing the 
nearly instantaneous trading 
of trillions of dollars in de- 

Industry officials counter 
feat futures trading is. inher- 
ently risky aid that no reg- 
ulatory regime can eliminate 
fraud or foolishness. Besides, 
they argue, most major prob- 
lems have been uncovered by 
the affected institutions feem- 

allied itself wife the Chicago 
exchanges to try to ensure 
equal treatment of the com- 
plex financial products it 
designs for its clients’ 
hedging needs. 

Meanwhile, Alan Green- 
span, chairman of the Federal 
Reserve Board, warned in a 
speech this year against 
“one- size -fits- all” financial- 
market regulation, a state- 
ment that was universally 
read as a call for looser scru- 
tiny of derivatives trading 
among sophisticated in- 

“Migration of activity from 
government-regulated to 
privately regulated markets 
sends a signal to government 
regulators that many transact- 
ors believe the costs of reg- 
ulation exceed the benefits," 
Mr. Greenspan said. But" he - 
cited a need for protection 
against fraud "and maiket ma- 
nipulation. for retail customers. 

Britain as Its 
Top Investor 

The Associated Press 

RANGOON — Total for- 
eign investment in Burma had 
risen to $6 billion by April of 
this year from $53 billion last 
December, the official My- 
anmar Investment Commis- 
sion reported Wednesday. 

Britain was the largest 
single source of investment, 
with about $13 million, fol- 
lowed by Singapore with $1.2 
billion and Thailand with $1 
billion. The United States 
moved from sixth place in 
December with $243 million 
to fourth in April wife $542 

The figures were compiled 
before fee United States im- 
posed economic sanctions on 
Burma in May. 

groupe indosuez funds 

do Banque Indosuez 
39 Allee Scheffer 
L2520 Luxembourg 

Grand Duchy of Luxembourg 
Telephone (352) 4654 24 470- Fax (352) 47 67 661 


Notice is hereby given to Unitholders that the following 
Portfbfioswill be open for subscription from 
the 20th May 1997. First NAV calculation 2nd June 1997. 

The North America Smaller Companies Portfolio 
The Latin America Portfolio 

XWnrniW' BiW. 

phase contact us ot Ike above 

klTTTi* (vtvTI* 

Significant Expansion Abroad in 1996 

The key figures for 1996 are favourable with a consolidated income 
and profit, total assets and shareholders' equity all up. 

Consolidated figures 



change in % 

in millions of CHF 





Net profit after tax 




Total assets 

13 407 

12 636 


Shareholders' equity 

1 252 

1 161 


m The Bank continued to expand its business base with the integration 
of Nordfinanz Bank Zurich within the Group and the launch of 
UBP International Inc. in New York, specialising in asset management 
as well as mergers and acquisitions. 

■ A purchase of a substantial stake in Banco Excel Economico will serve as 
a springboard in the development of the Group’s Brazilian asset 
management business. 

Head office: 96-98, rue du Rhone, P.0. Box 1320, CH-1211 Geneva 1 ■ TfeL (41 22) 819 21 II -Fax (4l 22) 819 22 00 

Geneva-Zurich • Lugano ■ London -New York- Hong Kong -Singapore -Tbkyo • Helsinki -Jersey- Istanbul - Latin America- Nassau 

PAGE 18 


PAGE 19 






efforts pay off. Daring a 
dHTicutt economic 
transi tion, austerity helped 
the country get its 
fitaaxses in order, end the 
state transferred much of 
its control of the economy 
to the private sector. 

Foreign investors haw 
. poured $17 biBon into 
Hungary overthe last 
seven yeas, the banking 
sector has been 
modernized amt the stock 
market rose 170 percent 
last year. Reaffirming its 
inks to Western Europe, 
Hungary has prepared 
itself to join the Emopean 
Union and NATO. 
Photos: The LancUd bridge 
in Budapest, and Vadutca, 
the city's main pedestrian 
shopping street 



? . Tatabaoya* ® BUDAPEST Debra 


mail Bekescsaba* 

k .Nagytanizsa ■ Hocfcnflzovaaamajy 

Kaposvar. Sz^ed _ tg J 




Year One as Central Europe’s New Role Model 

After a remarkable economic turnaround. Hungary * is now seen as a leader rather than a laggard. 

A ll of Hungary’s eco- 
nomic indicator?- 
have turned around' 
dramatically over the past 1 2 
ntonths. with further, even 
larger improvements in the 
offing. But perhaps the 
largest change involving 
Hungary has not occurred in 
the country itself, but in the 
U outside world. 

I \ year ago. conventional 
wisdom saw the Hungarians 
a-j “the perpetual laggards” 
of the CEE (Central and 
Eastern European) region. 
Tfcday, the three main com- 
ponents of the country ’s turn- 
around — rigorous privat- 
ization. bank consolidation 
add public see', jr austerity 
programs — are being 
eagerly adapted by other 
CEE countries for their own 

[Capital, some S17 billion 
of it over the Iasi seven years, 
has flowed freely into the 
kviintry The inflow of cap- 
ital. ihc highest among 
Europe's countries on a per 
capilu basis, has been spent 
oh acquiring one-third of the 
country's “legacy” economy 
- 7 the mass of state-owned 
enterprises put up for privat- 
i Anion — plus roughly two- 
tKirds of Hungary 's banks 
i* ,i(id a growing portion of its 
energy suppliers, telecoms 

and other infrastructural cor- 

Accompanied by a large- 
scale transfer of managerial 
expertise by the companies 
providing it, the capital has 
also been invested in a vast 
range of large-scale green- 
field projects, including such 
well-known examples as 
Audi's engine manufacturing 
plant in Gyor. 

Open door 

Goods, too. are flowing in 
and out of Hungary in ever- 
greater quantities. Growing 1 
faster than world trade by a 
margin of two-and-a-half to 
one, Hungary’s exports in- 
creased by about 22 •percent 
in 1995 and 12 percent in 
1996. with imports rising by 
about half that amount. 

In a highly gratifying de- 
velopment. the increase in 
exports has been particularly 
strong in such advanced in- 
dustrial sectors as automo- 
biles and computers. Perhaps 
the mast interesting and im- 
portant sign of how success- 
ful Hungary’s industrial 
transformation has been is 
provided by the 19 percent 
jump in the value of engi- 
neering and other technical 
services supplied to custom- 
ers outside the country. 

The sweep of Hungary’s 

open door policy has made it 
an exception in foe CEE re- 
gion, in which national gov- 
ernments have allowed 
thickets of policies and un- 
official operating rules to 
brake investment by foreign 
corporations in foe local 
banking, industrial, media 
and public service sectors. 

In this regvd, CEE coun- 
tries are by no means ex- 
ceptions in the world, points 
out Alarich Fenyves, a mem- 
ber of Creditanstalt’s board 
of directors and head of foe 
Vienna-based bank's interna- 
tional operations. 

“In its scope, Hungary’s 
privatization of its mfrastruc-. 
ture grids is only comparable 
to that of Argentina. Hun- 
gary's opening up of its 
banking sector to internation- 
al capital has no real match 
anywhere else in foe world,” 
says Mr. Fenyves. 

Privatization and austerity 

in 1994 and 1995, while its 
Visegrad Five counterparts 
(Czech Republic, Poland, 
Slovakia, Slovenia) were 
moving from strength to 
strength, Hungary was mired 
in the economic doldrums. 
The cost of financing the 
government’s ballooning 
deficit was causing foe coun- 
try's targe external debt load. 

itself a legacy of the Com- 
munist era, to rise to dan- 
gerous levels. 

The privatization of its 
utilities, national telecoms 
company, major manufactur- 
ers and other blue chip assets 
brought foe country a good 
amount of badly needed 
cash. To cut costs, the Hun- 
garian government launched 
a sweeping austerity pro- 
gram centered on the trim- 
ming of social services and 
foe raising of prices of pub- 
lic-supported items (princip- 
ally food). 

Remarkably, foe austerity 
program, although highly 
unpopular, was not met by 
widespread strikes or social 
unrest, although it caused a 
sharp drop in the country’s 
standard of living. 

“There was — and is — a 
widespread commitment 
among Hungary’s people to 
doing whatever ft takes, to 
putting up with foe short- 
term pain required, to work a 
lasting transformation,” ex- 
plains Sza boles Fazakas. foe 
country’s minister of in- 
dustry, trade and tourism. 

The final economic fig- 
ures for .1996 are out and 
they are extremely good. 
Boosted by surge in exports 
and a near 30 percent rise in 
tourism-related revenues, in 

19% Hungary registered a 
45 percent reduction in its 
current account deficit 
which amounted to a respect- 
able 3.5 percent of gross do- 
mestic product for the year. 
In 1994, the year before foe 
government of Gyula Horn 
instituted its austerity pro- 
gram. the comparable figure 
was 8.4 percent. 

The trimming of its public 
sector deficit to 3.3 percent of 
GDP (as opposed to 1994’s 
8J2 percent) helped Hungary 

reduce its net external debt 
from 1995’s $18.9 billion to 
19%*s $12.6 billion. It also 
caused Hungary's debt ser- 
vice ratio (total federal-level 
debt as a percentage of GDP) 
to decline from 48.7 percent 
in 1994 to 31 percent today 
— about hal f foe level set as a 
target by foe Maastricht 
treaty for European Union 
countries to join EU mon- 
etary union. 

Why Hungary 
Should Join NATO 

Dn May 27, 1997, Javier Solatia, secretary-general of the 
North Atlantic Treaty Organization, and Yevgeni Pri- 
makov, Russia’s foreign minister, signed the “Founding 
Act” It establishes the ground rales of the relationship 
between the alliance and Russia — ■ and apparently puts 
Hungary, Poland and the Czech Republic on a very fast 
track for N ATO membership. 

The admission of these ‘‘first wave” countries is ex- 
pected to be finalize d at NATO’s next summit, to be held 
in Madrid on July 8 and 9. 

For Hungary, the- moment will represent the reward 
for seven years of concerted effort 

Formal relations between Hungary (then still nom- 
inally a member of the Warsaw act) and NATO were 
launched in late 1990. The country has been an active 
participant inthe North Atlantic Cooperation Council 
(founded in 1991), the Partnership for Peace (1994) and 
other forums designed to promote closer political and 
defense ties between the members of the Atlantic alliance 
and tiie countries of Central and Eastern Europe. 

Hungary has actively participated in military exercises 
staged under the auspices of NATO, the Partnership for 
Peace and various groupings of European countries. But 
perhaps the greatest recommendation for NATO mem- 
bership came from Hungary’s successful facilitation of 
the various peacekeeping efforts undertaken by NATO 
and its allies in Bosnia. 

Laszlo Kovacs has been Hungary’s minister of foreign 
affairs since July 1994. In the following interview, he 
discusses his country’s preparations for joining the 
NATO and the European Union. 

The agreement recently reached by NATO and Russia has 
apparently put Hungary and several other Central and 
Eastern European countries on a fast track for membership. 
Their joining will engender considerable costs for the present 
members. What benefits to NATO doyou foresee arisingfrom 
Hungary k membership? 

One comment about foe costs. Crisis prevention is always 
cheaper than crisis management, as foe recent experience 
with Bosnia shows. And NATO has repeatedly proven its 

Continued on page 21 

Continued on page 21 

Foreign Investment, Chapter Two 

Scrutinies Fazakas has been Hungary's minister of in- 
dustry. trade and tourism since November 1996. During 
his 17-vcar career at the country's trade ministry, Mr. 
Fa/akas held a number of senior positions. In 1 989-90, he 
Was deputy minister of the government secretariat of 
international economic relations. From 1990 to 1995. he 
was the chief executive officer of Austrian Industry’s 
subsidiary in Hungary. After a stint as state secretary at 
the Ministry of Industry and Trade (tour- 
ism was added to the ministry's name in 
1996). Mr. Fazakas served as Hungary's 
ambassador to Germany. 

" (her the hid tv ir years, Hungary has 
utiJcrgtmc a pauifid ami protracted restruc- 
turing process During this time, your coun- 
try has lagged behind several other Central 
a, id Eastern European countries, which have 
/'i‘cn achieving soring economic growth. 

Today. * our i nUHtn ■ s economy is regarded as 
rfie region \ tip-anJ-nmer. A number of the 
other CEE countries arc facing the need to 
take Hungary-style restructuring measures. 

Qn win feel vindicated ? 

\ No. because “vindicated” implies a satis- 
faction at being prov en correct, sooner or later. 

And since we never had any doubts as to the 
■•iisdom of the path taken, we’re not reveling 
any sense of belated satisfaction now. 

j We never had any doubt that our decision to make the 
iandamcnlal changes in our economy in one fell swoop 
n.iuIJ lead to long-term growth, a growth capable of sus- 
ijining nself over ilecades, not just one or two years. 

; The progress now manifesting itself is in line with our 

I Slur do we have any sense of self-satisfaction at the 
expense of neighboring countries. There’s often a tendency 
LA the world’s press to stick as against each ufoer, to anoint 
the region's “liivoritc of the year.” But we’re not in a beauty 

oiliest with each other. 

1 The world's business community generally uses the CEE 
i $gion js its unit of c aluation. meaning that the successes of 
the individual countries are the successes of die region, and 
vice versa. 

\ One final point Over the last few veare, Hungary’s 
economic ties to its CEE neighbors have been dramatically 
•Aovving in size and scope. Any weakness shown by these 

Szaboks Fazakas, minister of 
industry, trade and tourism. 

ever-more important trading and investment partners isn’t 
therefore any cause for self-satisfaction on Hungary’s* part, 
but rather a cause for concern. 

S/7 billion in international capital has been invested in 
Hungary in the last seven years. Where is new investment in 
Hungary going now •? 

Not surprisingly, we’re experiencing a large amount of 
follow-up and secondary investment 
This takes several forms. Such greenfield 
investors as Audi have extended and ex- 
panded production facilities. Companies 
such as Procter & Gamble, which invested in 
existing facilities via a privatization buyout, 
are now going greenfield, adding on entire 
new facilities. 

But perhaps the most interesting trend has 
been foe arrival of the suppliers, foe compa- 
nies interlinked through supply networks 
with General Motors, Siemens, Daewoo, Su- 
zuki, IBM and foe wortJ's other multina- 
tionals, four-fifths of which have already 
made major investments in Hungary. 

Another interesting change is that the 
long-awaited spillover effect is now ma- 

Western Hungary and greater Budapest 
were the focuses of foe first wave of in- 
vestment, quite logically so. These two regions are easily 
accessible from foe rest of western Central Europe, and they 
had been structured toward serving foe West under the 
Communist regime. 

Are wage or price differentials or property prices causing 
the movement eastward? 

Not really. Wages are somewhat lower in the East: prop- 
erty prices arc about foe same. Wc have set up a range of tax 
breaks throughout the country, their amplitude is a bit greater 
in the East. 

I think the real explanation stems from the high level of 
investor satisfaction with their initial investments in Hun- 
gary. It’s emboldened them to take a searching look for 
further opportunities in other areas of the country. Our eastern 
stretches, which arc in foe midst of completing the re- 
structuring of their large-sized industrial facilities, offer 
plenty of such opportunities. 

Interview by Terry Swartzberg 

ytm </pcrJ. @jrtm Crs/*>. mwah. • 

Castles here are not 
haunted by ghosts 

True, nobody has checked the figures, 
but Hungary is probably number one in 
the World as far as castles per capita are 
concerned. The lords of Hungary 
crowned almost every bill with a castle 
after the Mongol invasion of the 13tb 
century. Nowadays , these romantic 
buildings and ruins are not haunted by 
ghosts. Culture and tourism are lording 
it over in most of them. In stately and 
commanding castles, you can listen to 
concerts of worid-fdmous Hungarian 
orchestras and guest artists. Castles 
harbor museums, hotels i open-air 
theatres and equestrian festivals. But 
travellers may always come back to our 
present days and they will not be bored 
at all! They can choose between 
programs of cultural festivals, concerts, 
dance, ballet and folklore shows, 
theatres, museums and galleries. 

Hungary awaits you with 
. tbousqnd-yearoid hospitality. 

TOWUSFORM: H I 05 2 Budapest, SUtn U. 2. 

Tel: (3&-1) 117-9*00, Fax: (36-1) 117-9578 

E-mail address: umriafarm@maiLbuagaryirmr1sm.lnt 

hoatcpage:bttp: .'uww.buagarytourism.bu ' 

PACE 20 



The new system is expected to boost local participation in Hungary's capital markets .. 

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H ungary's Parliament is expected to pass a bilf later this 
month that. will reform the county's pension system in . 
a way that will , boost the ration's growing capital 
market and save die current system from- bankruptcy. The 
legislation would make Hungary the first of the former Soviet 
satellites to reform its pension system and the second European 
nation after Switzerland to have a mandatory private system. 

“This is the most important legislation of the yea; ” says 
Tibor Pamiczky, .vice president of die Supervision of the 
Voluntary Mutual Benefits Funds, a government agency 
leading die reform. “The effects of this law will be felt for 
years to come:" 

The bill is pass.earily because Hungary’s ruling 
coalition holds 72 percent of die Parliament's seals. It is 
expected to take effect on January 1, 1998. . 

The bill creates a three-tier pension system. Currently, 
Hungarians contribute .6 percent 'of their salaries, and em- 
ployers put an amount equal to. 32 .5 percent of workers' pay 
into a government-run fund Hungarians also have the option 
of saving for retirement in voluntary, private funds. 

Under the new system^ Hungarians’ contribution to their 
retirement accounts will go into privately tuii, mandatory 
funds. By the year 2000, Hungarians’ contribution to these 
funds will jump to 8 percent of their salary. All new entrants 
into the workforce will have to participate in the new system, 
while those already in the workforce who are 47 years old or 
younger will be able to choose -whether or not they want to. 
switch. People older than 47 will not be able to opt out of the 
current system. • 

There are several reasons for the ove rhaul. The current 
system is large and bureaucratic, and, because of shrinking 
birth rates and an increasing number of retirees, the state 
pension fond would lave gone bankrupt by 2010. Last year, 
(he pension system had a $262 million deficit, and this year’s 
shortfall will be more .than the $96‘milJion estimated in the 
budget Mr- Pamiczky calculates that the decreased amount 
of money going into the state system will result in a $395 
million deficit in 1998. He says the shortfall caused by the 
reform will be financed through government paper that the 
new private funds will purchase with their assets. 

Another reason for the reform is the belief that private 
managers will do a better job investing funds, allowing 
Hungarians to retire with richer pensions. 

' Lastly, experts say some of the money in the private funds 
will be invested in the Budapest Stock Exchange, helping to 
develop the market and lessen its reliance on globe-hopping 
foreign capital. It is estimated that $1 billion annually will go 
into foe new funds. . 

The BSE has been one of the star performers in foe world. 
In 1996, the BSE index soared 170 percent, and it is up 41 
percent so tar this year 

The creation of the new funds is a “huge achievement 
says Adam Gere, managing director of Sedgwick Noble 
Lowndes Kft, a benefits consulting company. “It is going to 

increase local participation, and that is a good- thing;'’ - 

.The exfont of the benefit wifi not be apparent until the new 
legislation is enacted, but some believe, it will not be as great 
as was initially hoped because of concessions made tji 
reform-waiy’uzriQns. . ■ " 

; “We understand the need for change,” says Karoly Gy- 
oigy, head of the international department of the National 
Confederation of Hungarian Trade Unions, which represent 
48 unions with 800,000 members. “We just wanted to make 
sure there were no negative effects oh the population. '' 

The unions pushed to have employees' contributions to dig 
private funds lowered from the 4.0 percent provided for in a» 
earlier version of foe bill and to institute a performance 
guarantee for foe funds. The performance standard has yet to 
be set Mr. Gere says a such a guarantee will drive managers 
to invest in bonds and thus lower investment returns. Mr! 
Pamiczky counters that the mandatory funds play a social 
security role, so they need to offer stable returns. ’ 

Theresa Agovinq 

Hungarims reading newspitpetsaewss the Darutre Irani Pa^amet^ 

Banks Shipshape After Sea Change 

The opening to foreign ownership has helped make the sector more efficient. - 

A dvanced financial 
/\ products ahdjiCTvioes 
X V.iand rotated! technol- 
ogies are spreading rapidly 
throughout Hungary’s corpo- 
rate and retailing sectors. 

The more than 1 .5 radlion 
cardholders in Hungary are 
busy using their newly ac- 
quired credit cards to do 
everything from getting a 
quick hit of . cash to mating 
purchases of major consumer 
durables, reports Gyoigy 
Suranyi, president of foe Na- 
tional Bank of Hungary. . . 

Now conducting most of 
their banking via on-line net- 
works, Hungary’s recently 
founded companies, have 
been receiving unexpected 
visitors of late — - bankers 
offering equity and working ! 
capital. The bankers repre- \ 
sent institutions that are the \ 
subject of competing! 
takeover bids from their in- : 
iemational counterparts. 

Meanwhile, foe percent- 
age of nonperforming loans 
issued by Hungary's banking 
community continues its 
steady decline, with foe 
amount of loans outstanding 
progressively rising. 

In real terms, about 6 per- 
centage points of a 20 percent 
rise in total investment in 
fixed assets in Hungary came 
from an increase in long-term 
corporate debt, and foe re- 
maining 14 percent was 
largely financed by foe 
companies themselves out of 
their cash flow. 

Despite this, the total li- 
quid assets of Hungary’s cor- 
porate sector rose 24 percent 
in 1996. 

As recently as four years 
ago, credit cards- were a sym- 
bol of conspicuous consump- 
tion used by the fortunate few, 
electronic banking was un- . 
known in Hungary, and per- 
forming loans and foe banks 
capable of making them were 
as unknown as cash-rich do- 
mestic companies. 

The investors’ job 
What has caused foe dramat- 
ic change? 

“A fundamental realiza- 
tion, and foe courage to act 
upon it, "-says Mr. Suranyi. 
“We realized that neither 
Hungary’s banking sector 
nor its business community 

in general had foe amount of 
capita] and of manageri al and 
tecbrkfldgkal expertise re-‘ 
quired to modernize. We de- 
cided to entrust that job to foe 
investors best capable . of 
providing all three items — w 
regardless of their national | 
origin.” I 

Before the investors could § 
be allowed to do their stuff, | 

ybs(2tii'rj it 

■$ 3 iW 

'"kvhujS 'ml'&V 

Above: Paywtg for gas with a cmtStcanL \ 


Left Steps on shop wndows in Budapest - 

visa m 

foe government had to get its 
banks in shape. In a pattern 
common to Central and East- 
ern Europe, most of Hun- 
gary's banks, founded or re- 
configured in the late 1980s 
and early 1990s, had used 
their newly created borrow- 
ing power to make a large 
number of ill-conceived 
loans, often to companies 
and individuals with which 
the banks had intimate ties. 

In 1992 and ’93, the gov- 
ernment spent 84 billion for- 
ints ($457,000) on “purchas- 
ing” the nonperforming 
debts from foe country’s 
troubled banks, effectively 
recapitalizing them. A fur- 
ther wave of recapitalization 
was carried out in 1994. 

“And then we moved pur- 
posefully and quickly, to 
privatize these banks in order 
to. provide a basis for pros- 
perous and stable growth, - ” 
says Mr. Suranyi, 

Foreign capital 
Most of the equity stakes in 
the banks were acquired by 
foreign finance houses. The 
ongoing policy means that 27 
of foe country's 34 major 
banks are partially or wholly 
owned by non-Hungarians. 

Foreign ownership ac- 
counts for about two- thirds 
of the banking sector and is 
set to rise even further with 

the new wavd of bank pri- 
vatizations. “I have no prob- 
lem with it,” states Mr. Sur- 
anyi. “The presence of the 
foreigners has given our do- 
mestic banks a standard 
against which they can and 
must benchmark themselves, 
making them more efficient 
in the process.” 

Local managers 
“A very productive symbi- 
osis has arisen,” Mr. Suranyi 
adds. “The best-performing 
banks m Hungary are those 
melding foreign capital and 
local management This 
trend has given us a gen- 
eration of capable financial 
managers. Via job changes 
and consultancies, these ma- 
nagers are busy transferring 
their.', expertise throughout 
Hungary's business commu- 
nity, making it more inter- 
national in foe process.” 

. . The incorporation of for- 
eign capital and expertise in- 
to Hungary's banking sector 
has benefited it m another 
way: clarity of ownership. 
Because all of the banks have 
been privatized or re-engin- 
eered under the klieg lights of 
public scrutiny, it’s clear who 
owns what, banks, and what 
foe ties are between them. 

Bank privatizations in 
many CEE countries have 
often been nothing more than 

a reshuffling of equity stakes 
between interlocking public 
and private sector interests. 
Such webs of ties and mutual 
dependencies are a major 
reason why foreign investors 
find many of foe CEEs 
banking sectors uninteresting 
as an object of investment — 
and why nominally strict 
banking laws often do not 
prevent the sudden collapses 
and huge loan write-offs still 
foe norm in foe region. 

New-rules • *• 

New financial legislation — 
entitled Offering of Securi- 
ties, Investment Services an'd 
foe Securities Exchange; and 
Hungarian Banking add 
Capital Market Supervision 
“.took effect on January’ 1, 
1997.- Among foe laws' liij- 
£rali£idg features is foe re- 
moval of the barriers be- 
tween commercial atfd 

investment banking. TKe 
laws also set strict standaius 
for ownership reporting, cor- 
porate accountability and 

pnidential behavior. “ 

Mr. Suranyi is confident 
that foe laws will be effec- 
tively enforced. .* 

“Because our banking 
system is now highly trans- 
parent, I'm sure we'll be able 
to make foe laws’ stipula- 
tions stick,” he says. 



hus produced in its entirety by the Advertising Department of the International Herald Tribune, 
ti mw sponsored by the display advertisers and the National Bank Hungary. - 
•' WRITERS? Theresa Agovina in Budapest and Tern.' Swanzherg in Miotieti. 

PROGRAM Dwecior: Bin Mahder. . 




PAGE 21 




Tourism Authority Goes Straight to the People 

The campaign highlights culture, food and village tourism. 

H ungarian tourism officials are reaching 
farther abroad to attract vacationers, and at 
the same time, encouraging Hungarians to 
holiday in their own country. 

The tourism agency is continuing the successful 
promotion it started last year to entice foreigners to 
visit Hungary by placing ads in international me- 
dia. Until last year, the Hungarian tourism agency 
cultivated interest m the country by marketing to 
tour operators and travel agents instead of at- 
tempting to reach foreign travelers directly. 
“We’ve only just started marketing to individuals. 

We couldn’t really afford to do it before,” says 
Gyorgy Szekely, director-general of the tourism 
division of the Ministry of Industry, Trade and 
Tourism. “This is an effective use of money." 


Statue at tbunderkhg St Stephen h Budapest 

Creating an image 

Last year's promotion was comprised of four 
different ads, which featured Budapest Lake 
Balaton. Hungary’s thermal baths and the Hun- 
garian Plain. This year, they have been joined by 
ads highlighting culture, food and village tourism. 
The $1.1 million campaign's theme is: “Open 
Doors. Open Hearts. Open Minds. Hungary.” 

Mr. Szekely says the ads promoting Hungary 
plant a seed m a travelers’ minds, so that when they 
visit a travel agent or tour operator they have an 
idea of where they would like to go. 

“It is a vety good idea,” says Richard Lyon, 
general manager of the Budapest Marriott. “Hun- 
gary still doesn't have an image in the minds of 
many travelers, and this is an opportunity to create 
a favorable image.” 

The campaign is designed so that it can be 
adapted to different target markets. For example, 
the village tourism ads are running only in news- 
papers in the Netherlands and Germany. That is 
because many travelers from those countries have 
already been to Hungary, so they are more likely to 
want to venture beyond Budapest A short film 
about village tourism was produced for repre- 
sentative offices in those countries to complement 
the ad campaign. Lists are available of small 
country hotels and families that welcome va- 
cationers into their homes. 

E “The Dutch and the Germans tend to be more 
| adventurous travelers,” says Mr. Szekely. “If you 
go around the countryside and see a tent pitched, it 
is almost certain the tourist will be German or 

While it is hard to quantify the campaign's 
success, Hungarian Tourism marketing chief Rita 

Szekeres says that calls and mail inquiries to Hun- 
gary’s tourist offices increased tenfold last year. 

Hungary has also made it easier for foreigners to 
team more about the country. Over the past 18 
months, 1 0 tourism offices have been opened bring- 
ing die country's total to 14. This year, outlets will 
open in Tokyo, Stockholm and Cluj. Romania. 

Domestic travel 

Yet as Hungary seeks to draw in more tourists from 
abroad it is also trying to convince its own people 
to explore their nation. It is spending $541 ,000 in 
the country on billboards and newspaper aids that 
feature images of a family bicycling in the country, 
with the caption: “Here, you are at home." 

In addition, every day a spot sponsored by the 
tourism board on a popular morning television 
news show discusses upcoming events in Hungary 
such as the summer art festival in June on Lake 
Balaton and the Ballet and Opera Festival in 
Budapest in August 

Ms. Szekeres says her agency thought a local 
campaign was necessary because many Hungari- 
ans have taken advantage of their relatively new- 
found freedom to travel abroad and needed to be 
reminded of the attractions in their own country. 

But just as Hungary strives to present a positive 
image at home and abroad, the country has been 
beset by bad publicity stemming from tourists 
being charged exorbitant prices for drinks and 
dinner at restaurants on and near Vaci utca, Buda- 
pest's mam pedestrian shopping street 

Hungary's government has been praised for 
taking swift action to squelch the problem. The y 
government closed the most egregious offender, a | 
restaurant that last month charged a Danish tourist a 
$6,000 for dinner for four. In addition, the ministry | 
has pledged to publish a list of restaurants that? 
operate without complaint and to start a tourist | 
complaint hot line that will be answered by a” 
multilingual staff. TLA. 

An indoor pool in Budapest 's famed GeUert baths. 

Joining NATO 

Tpr’-s** rsjsi.**: .» •• • 

Continued from page 19 

i R Si. A C i 

merits as a preventer of crises 
in Europe. One reason it has 
_ been able to forestall conflict 
in its areas of responsibility is 
that all its highly diverse 
member-stales are un- 
swervingly united in their ad- 
l herence to the same political 
and economic principles, 
principles re-adopted and 
pursued by p>ost -Communist 

— Over the last five decades, 
. NATO’s unity of principle 

- gsd diversity of experience 
have allowed it to speak with 
ene strong, compelling voice 
few peace and freedom. Hun- 
gary’s joining will represent 

4 Smother affirmation of this 
.unity. It will also extend this 
H &vereity, helping prepare 
'V SATO for its future chal- 
i Singes and further members. 


- Over the last few years. 
Hungary has systematically 
revamped its body of laws to 
harmonize with those of the 
EU in preparation for ac- 
cession. Since Hungary is 
already well on its wen' to 
becoming a de facto member 
of the EU. won ‘t formal ac- 
cession merely be icing on 
the cake? 

Not in the slightest The 
measures you mentioned 
have been preparations for 
the main event — admission 
to the EU. 

The preparations have fa- 
cilitated our economy’s in- 
tegration into the world's 
business community. This in- 
ternationalization is behind 
the great improvement in the 
country's economy. 

The mam event, whose 

riming will most probably be 
.finally established for Hun- 
gary over the next few 
months, will bring together 
our highly international 
economy and the world's 
largest and most truly inter- 
national market It’s thus a 
natural match. 

The accessions of Por- 
tugal, Spain and Finland 
have shown the benefits 
arising from full and formal 
accession, and how impor- 
tant participating m die un- 
ion's decision-making pro- 
cesses can be. 

One thing should be ad- 
ded. This process wifl not be 
a one-way street Over the 
last eight years, Hungary has 
used its hard- won freedom to 
work a top-to-bottom eco- 
nomic transformation. The 
EU wifi profit from having 
members — I'm also speak- 
ing of the other CEE coun- 
tries now slotted for mem- 
bership — possessing this 
highly topical expertise. 

A New Tradition Emerges in Szekesfehervar 

The town where Hungary's kings were once crowned and buried is now an electronics manufacturing center. 

Fareifpi Minister LasztoKovacs. 

"No news is good news. ’’ 
Do you find that this state- 
ment describes Hungary s re- 
lations with its neighbors? 

If “quiet” is defined as a 
lack of misunderstandings 
and differences, most defin- 
itely. When the Horn [Gyula 
Horn, prime minister since 
1994] government took of- 
fice, it made the resolving of 
all and any conflicts with its 
neighbors one of its highest 
priorities. And. thanks to an 
equal amount of goodwill on 
the part of Croatia, the Slov- 
ak Republic, Ukraine and 
Romania, we’ve been highly 
successful in this regard. 

But if “quiet” is inter- 

preted as a lack of devel- 
opment or significant events, 
then 1 can't agree with this 
description at all. As a glance 
at our trade statistics shows, 
both the volume and range of 
intia-regional commerce are 
growing steadily. This is an 
entirely natural develop- 

With the fall of the Iron 
Curtain, ties among the 
Comecon countries’ busi- 
ness communities were rup- 
tured. Within an extremely 
short period of time, Hun- 
gary compensated for this 
loss of business by reorient- 
ing the bulk of its trade activ- 
ities from east to west 

Over the last few years, the 
ties have been re-knitted, as 
foreign-trade professionals 
in the various countries have 
resumed contact on behalf of 
their new companies. 

By setting up and strength- 
ening CEFTA [Central 
Europe Free Trade Agree- 
ment] and other regional- 
level organizations, the CEE 
region's national govern- 
ments have greatly furthered 
this process. 

Interview by TS. 

S zekesfehervar, once 
the seat of Hungary's 
kings, is now the home 
to corporate royalty. 

Since 1991, companies 
such as International Busi- 
ness Machines, Ford Motor 
Co., Stollwerck, Nokia and 
Philips have invested a total 
of $1.2 billion in the city. 65 
kilometers (40 miles) south- 
west of Budapest Szekes- 
fehervar is home to 50 multi- 
national investors and 1 0,000 
small entrepreneurs. 

Hungary’s founding fa- 
ther, Arpad is believed to 
have settled in Szekesfcher- 
var in 8% after he led the 
conquest of the Carpathian 
Basin. That would make 
Szekesfehervar the oldest 
town in the country. Stephen, 
Hungary’s first king, built a 
basilica in Szekesfehervar in 
die early part of the 1 1th cen- 
tury, and for 500 years af- 
terward the country’s kings 
were crowned and buried in 
the town, a tradition that 
ended with the Turkish oc- 

But it wasn’t regal tradi- 
tion that has enticed investors 
to Szekesfehervar. Ironically, 
it was a bankruptcy. 

Szekesfehervar is home to 

Videoton Holding Rl. a 
Hungarian electronics man- 
ufacturer, which was once 
one of the country’s largest 
employers, giving jobs to 

20.000 people. But the col- 
lapse of the Soviet Union de- 
prived Videoton of its most 
important export market, and 
the company filed for bank- 
ruptcy in 1991, laying off 

12.000 employees. That pool 
of well-trained workers, 
combined with Szekesfeher- 
var 's proximity to railroads 
and highways, helpful mu- 
nicipal officials, tax holidays 
and a well-developed infra- 
structure have lured investors 
to the city. 

Many of the international 
companies with factories in 
Szekesfehervar rented space 
from Videoton so they could 
test the waters before making 
a large monetary commit- 
ment to the city. Renting 
space gave Videoton officials 
another idea: Why not rent 
people too? That provided 
another source of revenue for 
Vrdeoton and removed an- 
other headache for potential 
investors. Videoton is a con- 
tract supplier for both em- 
ployees and various com- 
puter parts for companies 

such as IBM and Philips. 

“There was an informa- 
tion-technology tradition that 
existed here, so it was a good 
opportunity for us. It was a 
competitive advantage," 
says Peter Gaal, communi- 
cations program manager of 
IBM Storage Product Kft.. 
which has invested $1 10 mil- 
lion in Szekesfehervar since 
1995 to construct two plants 
to build hard-disk drives. 

Last year, the company 
made 1 million hard-disk 
drives and recorded revenues 
of $390 million. After fin- 
ishing its second plant last 
November, this year IBM 
Storage expects to sell 4.1 
million disk drives and col- 
lect revenues of $1.3 billion. 
About 2,500 of the 3,000 
workers at the IBM plants are 
actually employed by 

“This could not have all 
happened with out the help of 
Videoton. They had all the 
contacts and employees. It 
was great." says Mr. Gaal. g 
“You can’t just hire 2,500 | 
people in two months be- f 
cause they all need to be g 
filtered, processed, inter- 5 
viewed. IBM just didn’t have 
the time." T.A. 

SrEkesfehervar’s Town Hat! Square, with the Bishop's Palace on 
the right and the St John of Nepomuk chinch in the background 

Model for Central Europe 

Continued from page 19 


The fall in Hungary’s stan- 
dard of living was accom- 
panied by a 6 percent drop in 
1995 and in 1996 in its av- 
,aage wages in real terms 
{after allowing for the effects 
of the country's 20 percent 
.annual rate of inflation). 
Coupled with the massive 
amount of investment in the 
country's capital stock, this 
drop caused a sharp rise in 
the country’s relative pro- 
ductivity. Stemming from 
this increase have been the 4 
. i percent rise in industrial out- 
put recorded by Hungary 
. during 1995 and ’96, and the 
.ongoing fall in the country’s 
. fate of unemployment, now 
at a six-year low. 

The GDP is the most 
closely watched of all eco- 
nomic figuns. It is also die 
°nly one that did not show a 
sparkling improvement in 
■J996, rising a meager l per- 
. cent. 

^ : For 1997, international 
analysts are predicting 4 per- 
cent to 5 percent growth, 
which would be one of the 
highest growth figures in the 
-rcgkm. Mr. Fazakas is more 

conservative. “By their 
nature, forecasts overaccen- 
tuate the positive or the neg- 
ative. We're sticking to our 
prediction of 3 percent.” 

That would still be enough 
to put Hungary near the top 
of the CEE’s growth tables, 
as a number of the region's 
other countries are now 
wrestling with the problems 
Hungary has addressed over 
the past few years. 

Even those CEE countries 
that are still prospering have 
not been spared drops in in- 
dustrial production, bank 
failures and other ills. 

Is there a lesson in all 

“Yes,” says Mr. Fazakas. 
“I think that Hungary's re- 
cent experience shows that 
internationalization should 
not be postponed because of 
the short-term political and 
economic upheavals it 

“The efficiency imparted 
by an unswerving adherence 
to *no border' economic 
policies is really an absolute 
essential of long-term 
growth.” TjS. 

National Bank of Hungary 

Hungarian Tourist Board 


Margit krt. 85 

H-1850 Budapest V 

H-1024 Budapest 

Tel.: +36 1 332 2521 

Tel.: +36 1 375 3564 

Fax: +36 1 269 0735 

Fax: +36 1 375 3646 

NUnlsby of Industry, Trade 

and Tourism 

Affinlstry of Foreign Affairs 

Honved utca 13-15 

Bern rkp. 

H-1880 Budapest 

H-1027 Budapest 

Tel.: +36 1 353 0000 

Tel.: +36 1 356 8000 

Fax: +36 1 353 2794 

Fax: +36 1 355 9693 

Central Europe Online (http:// 
gary) and City.Net (http:// 
are full-service Web sites providing 
businesspeople and travelers with 
every kind of briefing and sen/ices 
required, ranging from the latest 
weather report and news to in-depth 
information on the country’s cul- 
tural attractions and business sec- 

tors. They also offer handy city 
maps and public transport sched- 
ules. Both are linked to hotel book- 
ing services. 

For businesspeople looking into 
investing in Hungary, the Ministry of 
Industry, Trade and Tourism's Web 
site ( offers in- 
depth information on the country's 
economy, applicable legislation and 
other pertinent subjects. 

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PAGE 22 



Bruguera Brings Normality Back to French Open 

Noise Annoys NBA 

basketball The National Bas- 
ketball Association is taking to curb 
noise at games. 

David Stan, the commissioner, 
said the music that teams play dur- 
ing time-outs and, increasingly, 
during play, is just too loud. He said 
he has told the clubs to turn it 

“We actually have a decibel 
counter and we check that 
throughout the season,** Stem said, 
adding that although there had been 
a lowering of the volume die music 
was still ear-splitting and poten- 
tially deafening. (AP) 

Lions Maul Mpumalanga 

rugby UNION Rob Wainwright 
scored three cries in nine minutes 
Wednesday as the British Lions 
beat Mpumalanga, formerly South 
Eastern Transvaal, 64-14, at Wit- 
bank in South Africa. ( Reuters ) 

Russia Bids for Euro 2004 

soccer Russia will bid to stage 
the European soccer championship 
finals in 2004, Vyacheslav Ko- 
loskov, the Russian Football Union 
president, said in an interview pub- 
lished Wednesday in a Russian 
sports newspaper. ( Reuters ) 

Caps Fire Schoenfdd 

ice hockey The Washington 
Capitals fired Coach Jim Schoen- 
fela on Tuesday. Schoenfeld, who 
interviewed for the team's general 
manager job less than a week ago, 
was dismissed over the phone by 
team president Dick Patrick. He 
had been with the club since 1994. 
accumulating a 1 1 3-102-34 record, 
and had two years remaining on a 
contract that was -renewed in 
September. (AP) 

Orlando Hires Daly 

BASKETBALL Chuck Daly ended 
a three-year break from coaching 
Tuesday, accepting a three-year, 
$15 million offer to take over the 
Orlando Magic, a job he originally 
turned down. 

Daly, 67. led the Detroit Pistons 
to NBA championships in 1989 and 
1990. He had been working as a 
television commentator with Turn- 
er Sports. «’ . . (AP) 

Helen Jacobs Dies 

tennis Helen Hull Jacobs, who 
won nine major chftnpionships in 
the 1930s, died Monday in East- 
hampton. New York. She was 88. 

Ralph Smith, her lawyer, said the 
probable cause of death was heart 

Jacobs won the U.S. national title 
four straight times in 1932-35, the 
Wimbledon singles in 1936, and 
was a mainstay for the U.S. Wight- 
man Cup team in 1927-39. (NYT) 

. By Ian Thomsen -■ 

International Herald Tribune 

Erie MarbagfAgenee ftmwpnm n 

Galo Blanco leaping to reach a shot Wednesday in bis quarterfinal against Patrick Rafter at the French Open. 

Betis Shrugs at Charges It Threw Game 

CtmfiU trr Q* Sag From Dbpenha 

The players and coach of Real Beds, 
of the Spanish League, hit back Wed- 
nesday at critics who accused them of 
not trying in Saturday's 1-0 defeat by 
Sporting Gijon, which is one of the 
teams struggling to avoid demotion 
from the first division. 

The result condemned Sevilla, the 
local rival of Beds, to relegation and 
jeopardized the first-division places of 
several other clubs. 

“We can’t have a load on our con- 
science because of the poor seasons of 
others,” said coach Sena Ferrer. 

During the game Beds fans cheered 
the Sporting goal and- booed offside 
decisions made against the visitors. 

The match attracted a flood of crit- 
icism, principally from managers of 
other teams threatened by relegation. 

“I had to turn the television off,” said 
Maximo Hernandez of Rayo VaDecano. 
“I had never seen a team go out to 

Paco Flores of Espanyol said, “Beds 
will pay in time. History doesn't for- 
give. They will pay for it” 

Alexis Triijillo, the Betis captain, ad- 
ded, "They are excuses to remove im- 
portance from their defeats. The fans' 
reaction was justified because they had 
to suffer a lot of pain in recent years.” 

After years of playing second fiddle 
to its neighbor. Beds bad already Qual- 
ified for the UEFA Cup and reached die 
Spanish Cup fhml- 

Sevilla has twice been accused of 
throwing games to harm Beds. 

MAJOR LEAGUE soccer Attendance 
in the U.S. professional league is av- 
eraging less than 15,000 this year, 


well below the target of 20,000 set by 
Doug Logan, the league president. 

“I don’t know if I'm going to get 
there,” Logan said Tuesday. 

“I’m pretty certain we’ll wind up the- 
season higher than last year's average,” 
Logan said. “We’re not going to nave 
the significant drop off we had in the 
middle of last season,” which clashed 
with die Olympics. 

Fifty-eight games into the season, 
MLS is averaging 14.925, 14 percent 
down from the final average of 17,416 
through 160 games last year. Hie league 
has died to boost attendance by playing 
more games on the weekends. 

Logan attributed much of the drop to 
“an early season spike last season” and 
foul weather, particularly in the New 
York, Kansas City and Colorado areas. 

touiokh DE FRANCE A 60th-minute 

PARIS — Nothing sensational or 
bizarre happened -Wednesday at what 
has become tennis’s version of die 1929 
stock market crash. It was a day of 
recovered-security and measured con- 
solidation. But lard knows, another fa- 
vorite will be 'jumping out the jwindow 
by the weekend. ' )■ 

. . The. last- surviving .male see d at the. 
French Open — and therefore the most 
likely candidate for suicidal play — is 
No. 16 Sergi Bruguera, the_1993 and 
1994 champion at Roland Garros who 
hasn’t won a title of any- kind in three 
years, ^ruguera, ranked 19th in the 
world; wouldn't have been seeded at all 
thisfortnighlif not for the withdrawal of 
No. 9 seed Thomas Enqvist of Sweden 
shortly before the tournament. 

Bruguera won. his quarterfinal by 4-6. 
6-3, 6-2, 6-2 against Hicham Area, an 
unseeded Moroccan who lives in sub- 
urban Paris. 

Given that Arazi was ranked no better 
than 55th in the world, had never made it 
past the second round in a Gtand Slam 
event before last week and had just one 
career tide fin Casablanca, wonder- 
fully) compared to 14 for Bruguera, it 
was widely anticipated dial Bruguera 
would be in big trouble. Unlike most 
everyone else at Roland Garros, 
Bruguera somehow tamed all of his 
perceived advantages 'to his favor. It is . 
hissecret. • 

In the men’s s emifinals Friday, 
Bruguera will meet Patrick Rafter of 
Australia, the world No,. 25 who in 

S [dally bewildering fashion overcame 
o. 1 11 Galo Blanco of Spain, 6-3, 7-6 
(7-3), 6-3. . 

The-' other semifinal will involve die 
No. .122 qualifier Film Dewulf, the first 
Belgian to advance this far in a Grand 

equalizer by substitute striker Marc 
Keller gave Fiance, the 1998 World Cup 
hosts, a 1-1 draw with world champion 
Brazil in the opening match of the four- 
team Touraoi de France. 

Roberto Carlos, who plays for Real 
Madrid, had given Brazil the lead in the 
21st minute with a wickedly swerving 
free kick that left Fabien Barth ez, the 
French keeper, flat-footed and open- 
mouthed as it hit the inside of a goal post 
and flew into the goaL 

world cur Iran took its tally of 
goals this week to 24 when it beat 
Kyrzygstan, 7-0. in Asian qualifying 
Group 2, which is being played in Dam-: 
asciis. Iran brat Maldives on Mondavi 
17-O. In Wednesday's other game Syria 
beat the Maldives 12-0. 

ITALY Serie A produced more goals 
and more penalties. this season, Paolo 
Casarin, Italy’s refereeing chief, said 

Casarin said referees awarded 109 
penalties of which 80 were indisputable; 
10 "invented” and 19 debatable. He also 
said referees missed 10 other genuine 
penalties. Casarin said there were 808 
goals in Serie A this season, up from 702 
in 1990. He said there were an average of 
40 fouls a game, which was within the 
European norm, but fewer than the 
Champions League final with 55. 

Slam of the 
victory. Dei 

ce this far in a Grand 
n era. With one more 
will become foe first 

n 'lfier to experience a Grand Slam 
. Opposing him will be No. 66 
Gustavo Kuerten of Brazil, the winner 
of his last three rounds in five sets each. 

No. 5 Thomas Muster. The 20-year-old 
Kuerten has never advanced this for in 
any toar event. • 

Roland Garros has thus been assured 
of its seventh unseeded finalist since 

“I think sometimes it’s good not to 
have any experience,” said the 26-year- 
old Bruguera, -ya rn has-b een rebuilding 
-his form -afto-ar. temficr -ankle Injury- 
suffered on-thcltye^jf last season.- ■ ■ 

“For me, the first time I won, 
everything was new. I was playing with 
the best confidence without thinking 
about anything. Sometimes is good, 

Arazi would have agreed after win- 
ning the opening set against Bruguera. 
The lefthanded Arazi, 23. was surely the 
more elegant shotmaker. Then 
Bruguera established his metronomic 
rhythm from well behind the baseline, 
deadening the Moroccan of his joy, frus- 
trating him. His last tired weapon was a 
diop shot which he tried seybal times 
too many. 

Rafter wanted badly to win hik.r 
quarterfinal at the net, but he succeeded;,- 
&st' of all . by wrestling with Blanco.^, 
from tbe baseline. The Spaniard could- was tight going 

late into the second set tiebreaker, wheiL,. 
Blanco lost a pair of service points with.;, 
his forehand, one ballooning long and r 
the next hopping off the tape. He had 
recovered fipim such mistakes earlier in..? 
the match; but now Rafter was cashing,.! 
in quickly. . . „ 

Rafter, 24, won his only singles title. ^ 
three years ago at Manchester. He was " 
injured for parts of a year and a half u , 
before thin year improving his ranking ., 
from No.' 62. Next week, he will move’:', 
into the Top 20 for the first time. " 
The clay courts are sunbaked and fast . 
tins year, but, still, 'he never would have' . 
imagine d doing this well — no Ausrt^ 
tralian has reached & French Open semK . 
final since Phil Dent 20 years ago, and' 
no one has won it since Rod Laver in,^ 
1969 m the days of Australian greatness.- _ 
In that tournament, Laver beat Keti,_ 
Rosewail in the final Tony Roche, Fred ~ 

S to lie and John New combe had also. , 
reached the final eight 

‘‘We have a surface at home called 
Antbed,” said Rafter, describing his'! 
early training for this surface. “The big * 
ants, they make these huge mounds. Get „ 
it and crash it They make the courts o^ 
ic. It's very slippery. You can’t move' ' 
You slidea lot, but it’s difficult to stand^ 
up. That’s about the only close thing to ' 
clay we have bade in Queensland. ” ^ 

O N THURSDAY, the women will 
take over center court fen* thei£'| 
semifinals, after having been re-;", 
legated — under their continuing 
protest — to the secondary Court Su*^ 
zanne Lenglen for theprevjous round.' ^ 
No. 11 Amanda Coe&er of South 
Africa, who has how knocked Steffi^ 
Graf out of tire last two Grand Slanp 
events, will meet No. 9 Iva Majoli of.* 
Croatia. » 

The most provocative matchup of the * 
women’s tournament thus for will be 1 
No. 3 Monica Seles against her sue-'* 
cessor as prodigy. No. 1 Martina Hingis*, 
of Switzerland. Seles, now a relatively*, 
elderly 23, Won three consecutiwjj 
French Opens before she was stabbed 
the back by a German fanatic four yearj- 
ago. At the 1990 French Open, SeleCv- 
became tbe youngest woman Grand- 
Slam champion of modern times — a 
record broken by the 16-year-old Hingis 
in January at the Australian Open. 

•• Hingis was in a good mood Wed^ 
-nesday as she won a doubles match with-- 
her Spanish partner, Arantxa Sanche?’ 
Vicario, twice a champion. 

The two of them had opposed each. ; 
other in the angles quarterfinal the dayr> 
before. In their relationship on court;” 
Sanchez Vicario, 25, was now the big.r 
sister. They whispered strategy to each*- 
other and Hingis turned away with abop„~ 
smiling. Hingis was really enjoying her- 
self when a bit of noise came splashing 
in from tiie larger center court stadium,. . 
next door. Then Sanchez Vicario hit ■ 
bad shot She slammed her racket off its’" 
heel and caught it again with both hands; - 
That was the only time she revealed - 
what had happened the day before. 

Precious Pay Dirt: Who Foots the Bill for New Stadiums? 

r r n; 
l -y 

By Richard Sandomir 

■V»n lift Tims Service 

N EW YORK — North America is 
in the grip of “Stadium 

In every big-time sport, owners by tbe 
dozen are asking for, and usually get- 
ting. new stadiums and arenas to finance 
their cash-flow reveries, soaring player 
salaries, loans to buy their teams and 
estate plans. 

The wave of construction has spurred 
a hot public debate: Should millionaire 
owners coping with the high cost of 
business reach into their own pockets to 
build luxurious sports palaces? Or, 
scared that a team might leave or eager 
to lure a team from elsewhere, should 
state and local governments pay for 
such places? 

“You don’t measure sports teams 
just in dollars and cents,” said Peter 
Karmanos. who Iasi month moved his 
liockey team, the Hartford Whalers, 
from Connecticut to North Carolina. 
“You measure it in cultural spirit Ask 
people in Hartford what they think it 
means lo the city when they lost the 
team, or in Minneapolis-SL Paul. Ask if 
tliey'd reconsider subsidizing a team to 
come back there.” 

Opponents say that subsidies, such as 
broad-based sales taxes, constitute cor- 
porate welfare, mocking the public’s 
need to pay for essential services. In 
addition, many studies show that there is 
linlc economic gain from these kinds of 
projects, and that spending on stadiums 
merely diverts spending from other 

“Once you take taxes to pay for a 
stadium or arena, you can't spend it 
somewhere else,” said Mark Rosen- 
traub. a professor at Indiana Uni- 
versity's School of Public and Envi- 
ronmental Affairs. “Stadium 
ernstmetion creates no real wealth. It 
just transfers it” 

Still, a hodgepodge of public and 
private financial resources makes up the 
construction plans of 44 professional 
teams (spread over the four major U.S. 
sports) that are seeking, close to getting 
or building new stadiums or arenas. The 
list includes two arenas in Miami and 
possibly two in Los Angeles, plus two 
stadiums each in Cincinnati. Detroit, 
Seattle and San Francisco. But it ex- 
cludes a stadium being built for the 

Voters Favoring Arena Complex for 49ers 

The Associated Press 

SAN FRANCISCO — A razor-thin 
majority of voters approved tbe pro- 
posed $525 million stadium-and-mall 
complex for the San Francisco 49ers, 
but uie tally was not final. 

Tuesday’s vote counted out at 50. 1 
percent for the project and 49.8 per- 
cent against, with 100 per cent of 
precincts reporting. 

But about 4,500 additional ballots 
from voters who had moved or had 
been dropped off active voting lists 
remained to be counted over the next 
week to 10 days. 

“1 understand the game is never 
over until the official blows the final 
whistle," said Carmen Policy, the 
team's president. 

The proposal trailed by as many as 
12 percentage poults in initial returns 
before finally nosing in front late in 
the evening. 

A spokesman for those opposed to 
the project, Jim Ross, said he ex- 
pected the election to be close but 
thought that even those who voted for 
the proposal did not necessarily tike 
it. “It’s the fear of losing tbe 49ers — 
that's what caused people to vote for 

renascent Browns in Cleveland, and one 
proposed for the Coliseum’s site in Los 
Angeles, which has lost two football 
trams since 1995. 

In New York alone, the Yankees’ 
desire a new stadium in Manhattan and 
the Meis are planning a retractable 
domed stadium on a site opposite Shea 
Stadium, for which they may ask gov- 
ernment aid. The Islanders are also look- 
ing for a new arena lo replace the aging 
Nassau Coliseum, with help from the 

‘ ’One of the main reasons I bought the 
team was the understanding that there 
would be an effort to build anew arena,” 
said John Spaoo, tbe Islanders' owner. 

The stadium and arena action ac- 
celerates almost daily: Columbus, Ohio, 
voters reject a tax increase for an arena 
and a soccer stadium; the Whalers pay 
Connecticut $20.5 million ova- 15 years 
to become the Carolina Hurricanes: the 
Minnesota Twins threaten to leave the 

it,” Ross said. An estimated 171 ,000 
people, w 42 percent of San Fran- 
cisco’s registered voters, cast ballots 
for Propositions D and F to cap a 
highly-charged and often bitter three- 
month campaign. 

Proposition D, which was passing 
by 781 votes, called for $100 million 
in bonds to help finance the con- 
struction of a replacement for 3Com 
Park at Candlestick Point- 

Proposition F, which was passing 
by 530 votes, would grant planning 
variances and alter certain zoning reg- 
ulations on city-owned land to clear 
the way for die new 75,000-seat sta- 
dium and an adjacent shopping and 
entertainment complex, whose tax 
revenues would be set aside to repay 
tiie bond. 

The 49ers and their mall-develop- 
ment partners would be responsible 
for die $425 million balance as well as 
any overruns. 

Backers, including Mayor Willie 
Brown, said the project would create 
up to 10,000 jobs. Opponents, led by a 
state senator. Quentin Kopp. called 
tbe project confusing and financially 
risky for taxpayers. 

Metrodome; the Cincinnati Ben gals 
sign a lease through 2026 for a stadium 
paid for mostly with a half-cent sales 
tax. “It’s a renaissance," said Jerry 
Bell, die president of the Twins. 

B UT NOT for the Twins, at least 
not yeL Minnesota's state leg- 
islature has not enacted any mea- 
sures to finance a new ball park, or erven 
bite at an offer by the team’s owner, Carl 
Pohlad, to trade the state a 49 percent 
interest in the team for financial back- 

The Twins are dot alone in seeking 
public aid: 

•San Francisco voted on a new foot- 
ball stadium on Tuesday. (See accom- 
panying article). 

• In two weeks. Seattle voters will. be 
asked to approve a $300 million pack- 
age of financial aid for the construction 
of a $425 million stadium for die 
Seahawks. The vote has been financed. 

with tbe approval of Washington’s state 
legislature, by Paul Allen, the Microsoft 
Corn, billionaire. 

• The Pittsburgh Steeiers and tiie Pir- 
ates, uneasy partners at 26-year-old 
Three Rivers Stadium, are trying tins 
month to put a referendum to build two 
stadiums on a November ballot. The 
financing includes a 10-county sales- tax 

Each referendum is, in a way. a 
plebiscite on bow for governments 
should go to help finance stadiums and 
arenas for privately owned teams. Own- 
ers say they merit public subsidies be- 
cause of the intangible psychological 
benefits of being a major-league town 
and die economic advantages foal teams 
generate. They wield the ultimate ham- 
mer, leaving town, which can bring a 
vulnerable city to its knees or usher in a 
sweet deal from another city. 

"Corporate welfare? Absurd," said 
Bud Seng, owner of the Milwaukee 
Brewers and baseball’s acting commis- 
sioner. He spent nine years cobbling 
together the money to pay for the team’s 
new home that will be completed in 
2000, Miller Park, including $160 mil- 
lion from a one- tenth of a cent sales- tax 
increase imposed on five counties. 

“This win produce a better return 
than many of the things that get gov- 

t ban many of th 
eminent funds.” 

In San Francisco, the Simon De- 
Bartolo Group, which is half-owned by 
Ed DeBaitolo Jr., the owner of the 
49ers, and Mills CoipL, a mall de- 
veloper, wanted the city to issue $100 
million in bonds to help back a $525 
million stadium and mall complex. The 
old stadium, 3Com (born Candlestick) 
Park, would be razed. 

Hie tram and city have presented 
many studies to show that taxes gen- 
erated by tbe complex would easily pay 
the debt on the project, and vowed to 
buy insurance to guarantee payments if 
there was a revenue shortfalL “It’s not 
viable,” said Andrew Zimbalist, an eco- 
nomics professor at Smith College in 
Northampton, Massachusetts. “The in- 
cremental revenues from tiie mail and 
stadium won’t pay the debt service.” He 
said the city’s estimate of $6. 1 million in 
yearly debt payments — to be repaid 
with sales taxes — should be raised to 
$10 million. 

In San Francisco, a city that rejected 
public aid for a Giants ball park in 1987 

and 1989, suspicion reigns. “Sports 
ownereare the new robber barons, said 
Joel Ventresca, chairman of the Com- 
mittee to Stop the Giveaway, an op- 
position group. He said he wondered 
how much more the city would end up 
paying in hidden infrastructure costs. 

P. J- Johnston, the press secretary to 
Mayor Willie Brown, said taxpayer 
money would never go into tiie project, 
which he said would enrich the low- 
income residential area near tiie sta- 
dium. He added that the city was better 
off with a new stadium than with spend- 
ing up to $130 nnOion to repair de- 
caying 3Com Park. 

T HE CAMPAIGN has also fea- 
tured the carrotand the threat: the 
National Football League has 
promised three Super Bowls for a new 
stadium. If there is no stadium, De- 
Bartofo has threatened to move, perhaps 
to open-armed Los Angeles 
In Seattle, the question of whether 
Paul Allen, whose Microsoft stock is 
worth $12.4 billion, deserves help from 
tiie public, is frequently heard. 

“Remember, Paul Allen was coaxed 
into this,” said Bob Qogerty, a cam p ai gn 
consultant to Allen. “This is a team 
whose owner was going to move the team 
in a van and Paul picked up tbe option. 
He’s saying. Til be a pan of this. 

But skepticism persists. In 1995, 
Se a ttle voters spurned a referendum 
providing financing for a $320 million - 
ball park for the Mariners, then watched 
Washington’s legislature retool the 
measure and pass it J 
This time, Washington voters are be- 
ing asked to approve$300 million from 
lottery games, stadium a dmissio n and - 
parking taxes, sales tax credits and de- 
ferrals and an eight-year extension of a 
King County lodging tax. . 

“Who’s more in need?” asked 
Shawn Newman, chairman of f*ih~twn 
for Leaders with Ethics and Account- 
ability Now. a watchdog group. "The 
guy on the street or the guy who made a 
billion dollars in a single day?” 

B ut Alien has urgency and leverage. 
He is paying $4.2 million to hold the ■ 
election, which state law allows. His 
option to buy the Seahawks from Ken 
Behring expires on. July I. And .he is 
spending several million dollars to 
spread his m e ssage on television, in 
newspapers and through direct mail. 

j jflfl 1 v v 



L j 

Paul Hm/RckUn 

Ivan Gotti, leader of the Giro, 
being cheered on Wednesday. 

Gotti Retains 
Lead in Giro 


CAVAlJBSfe, Italy — Pavel 
Tonkov was forced to change bikes 
right before the start of Wednes- 
day’s time-trial in the Giro d’ltalia. 
and could only reduce Ivan Gotti's 
lead by 14 seconds. 

Sergei Gontchar won tiie 40-ki- 
lometer (24.6-mile} race from 
Baselga di Pine to Cavalese in a 
time of 47 minutes 18 seconds. 

Officials said the rear wheel of 
Tonkov's bicycle had added ma- 
terials that are not allowed by race 
rales: Tonkov now frails Gotti by 
37 seconds. 

“I rode badly because I felt the 
difference in the new bicycle.’ ' said 
Tonkov, who was seventh on the 
day, 2:30 behind Gontchar. “My 
legs were affected by the change. 1 
had never fried using that particular 
bicycle. before." . . 

Tonkov had used tiie first bicycle 
in winning the Tour of Romandie a 
week before the Giro began. 

Evgeni Berzin was second in die 
time trial, 1 minute & seconds be- 
hind Gontchar. Gontchar moved up 
to seven* overalL (AP, Reuters ) 



jLong-Shot Red Wings 
Sink 2d Flyers Goalie 

By-Joe Lapointe 

New York Tina Service 

PHILADELPHIA — The Philadelphia 
Flyers changed goalies, changed a couple of 
forwards and changed a defenseman, too. Bat 
ttofty couldn't change die momentum of die 
Stanley Cup finals. 

Despite an impressive comeback from an 
early two-goal deficit, the Flyers lost again to 
the Detroit Red Wings, again by 4-2, in Game 
2, Tuesday. 

Detroit leads, two games to none, in the 
four-of-seven-game series as it seeks to win 
its'-first Stanley Cup since 1955, the longest 
drought among all National Hockey League 

. .Brendan Shanahan scored twice for De- 
troiL His second goal, midway through the 
third period, was decisive. . Alter Sergei Fe- 
dorov triggered a two-on-one rush with a long 
pass to Martin Lapointe, Shanahan took 
Lapointe's horizontal pass in the Philadelphia 
zone and wristed the puck past the diving 
Flyer goalie. Garth Snow, at 9 minutes 56 
seconds for die 4-2 lead. 

Shanahan also hit the goal post twice with 
shots, die second coming in the final minute 
after Philadelphia pulled Snow for an extra 

Defending on the play for Philadelphia was 
Paul Coffey, a foimex Red Wing who was on 
the ice for all three of Detroit's even-strength 
goals, and in the penalty box for the one 
Detroit goal on the power play. 

Sieve Yzerman scored the power-play goal, 
and Kirk MaJtby scored at even strength to 
break a 2-2 tie early in the second period. 

it was the first time in this postseason that 
Philadelphia has lost two consecutive games. 

Terry Murray, the Flyers coach criticized 

ting the big stops is your worst nightmare 
when you get to the finals.” 

'Murray said Kirk Maltby's goal on a long 
slap shot is the kind of save that has to be 

'“We need to be better in that position,” he 
said. When asked if he would play Snow or 
Ron Hextall in the next game, Murray replied: 
‘ Tm not going to give that answer tight now. 
I don’t know myself.” 

As for Coffey, Murray said, “We need a 
better Paul Coffey.’' 

Snow was in the Flyer goal in place of Ron 
Hextall, who played in Detroit's 4-2 victory in 
Game 1 on Saturday night Snow gave up a 
goal on the second Detroit shot, by Shanahan, 
after 97 seconds of play. 

He gave up a second, on the power play, 
when Yzerman knocked in a rebound at 

Rod Brind’Amour evened the score before 
the first intermission by scoring twice on the 
power play, both on deflections of shots from 
the blue line. 

Snow, who played the first two rounds of 
this four-round tournament, lost his first- 
string status to Hextall during Game2 of the 
third round against the Rangers. Murray re- 
versed their roles again after Game 1 on 
Saturday night, when Hextall gave up the 
crucial fourth goal to Yzerman on a 55-foot 
slap shot early in the third period 

Two of the first three Detroit goals Tuesday 
came on similar plays against Snow. With the 

score tied at 2-2 early in the second period, 
Detroit took a 3-2 lead on a long slap shot by 
Kirk Maltby, who fired the puck low on the 
glove side after crossing the blue line. 

Other than that, the Flyers seemed to take 
control of the game in the second period, 
hemming the Wings in their zone for long 
stretches that began with Philadelphia win- 
ning face-offs in the circles near goalie Mike 

The Flyers came into the game with a 
noticeable edginess that went beyond Mur- 
ray’s goalie maneuvers. Eric Lmdros, the 
Flyers' yoang captain, said Sunday that per- 
haps die Flyers should just “play hockey” 
and not worry so much about line matchups, 
as they had in Game 1. 

Such a statement could be construed as a 
veiled criticism of his coach. On Monday, 
after Lmdros and Murray had an intense con- 
versation during practice, Lindros, 24, was 
asked the subject of their discussion. 

“That is between Terry and L” Lmdros 
said. “We were just talking about a few 
changes that we might possibly make. 1 was 
offering my opinion on some things and be 
was, yon know, he was listening to than.” 

Murray , referring to Lindros, said: “Eric is 
the captain. He (foes have a great hockey 
mind. ” Lindros, in Game 1, assisted on both 
Flyer goals but finished with a minus 2 in the 
plus-minus ratio. There was speculation here 
that he might be upset with a lade of ice 

Sg^BwilyTh'.tariMrd Rw 

The Wings’ Darren McCarty Eric Lindros, captain of the Flyers, into the boards. 

Belle’s Homer Answers Taunting 

The Associated Press 

They booed and rang cowbells. They 

iners won their third straight 
Bnwan a. Red Sox 4 In Milwaukee, Jeff 

threw fate money, cups, ice, a baseball and Grifro hit a two-nm homer with two outs in 

even binoculars at their former hero. 

the bottom of the ninth to lift foe Brewers 

matchups, I rattle Albeit Belle. 

Still, Cleveland Indians fans couldn’t over Boston. Cirillo’s shoe completed a 

comeback from a 4-1 deficit and gave Mil- 

Playing at Jacobs Reid in Cleveland for wankee its fifth win in six games, 
the first time since he left the city for a OrtohMT.YtonkMssRafeel Palmeiro hit a 

megabucks deal with Chicago, Belle hit a two-run homer in the bottom of the 10th as 
three~nm homer and two doubles to lead foe Baltimore finally beat the Yankees at Cam- 

White Sox over the Indians, 9-5, on Tues- 
day night. 

den Yards. The surging Orioles, now lead- 
ing their division by a huge 8V4 games, beat 

“Out of anything you can say about the New York twice on the road last Week, but 
guy, he’s a great player,” said Jim Thome, went 0-9 against foe Yankees at home last 
who homered twice for Cleveland. “And I year. 

think he really loves the 

Athletic* 8, Tig arm 8 , 

Oakland, Mark 

Twins 5, Hangar* 4 Matt Lawton and Paul 
Molitor each went 3-for-5, and Rick 

McGwire hit his 22d horaer as the Athletics Aguilera pitched out of trouble in the final 
rallied for five runs in die seventh inning, two innings as Minnesota won in Texas. 
He has 10 homers in his last 19 games. BoyWto 5, to— 1 » 2 Tom Goodwin went 4- 

— — mars 6, Bhw Jays a In Seattle, Jay fbr-4 with a homer, and Tim Belcher 
Bohner homered twice and Jose Cruz Jr. hit pitched eight strong innings as Kansas City 
his first major-league homer as the Mar- won in Anaheim. 

Dodgers Strand 11 


Brett 1 Butter, .in what is 
pro bably foe. final season of 
his career, returned to 
the . Los, . Angeles. Dodgers’ 
starting lineup in Houston 
after sitting out 24 games be- 
cause of a sho ulder injury. 

But even Butler, one of the 
best. teadoff hitters in base- 
ball, * * couldn’t lead foe 

Toe. Dodgers stranded 1 1 
runners on Tuesday night, in- 
cluding eight in scoring po- 
ll L Roundup 

sition, and lost for foe 12th 
time in 16 games, 4-3, in 10 
innings to foe.Astrofi. 

Jeff Bagwell who leads foe 
National League with 18 
home runs, hit the game-win- 
ning homer off relief pitcher 
Sam Radinsky. 

Butler, who was batting 
356 before going on the dis- 
abled list May 7, had one hit in 
five at-bats and stole two 
bases. “It’s nice to be back, 
but we lost,” Butter saRL “I 
didn’t do my job. There’s no 
excuses. We’ve got to execute 
the fundamental firing and 
we're not doing it 

Rteta 2 , Expos i Bobby 
Jones got his 10th victory as 
New York beat visiting 

Matt Franco bomerod. and 
Carlos Baezga hit a run-scor- 
ing double in foe eighth to give 
Jones all the rum be needed. 

The Mets had been blanked 
over foe first seven innings by 
Pedro Martinez (8-2) before 
rallying. Jones struck out five 
and walked three. 

The Expos took the lead in 
the eighth on Rondell White’s 
double. But in the bottom of 
foe inning. Matt Franco, hit- 
ting for Jones, Led off with foe 
first pinch-hit homer of his 

Edgardo Alfonzo and Todd 
Hundley got on base and then 

Baerga. 7-for-10 in his career 
against Martinez, lined a 
double ! into the right-field 
comer to score Alfonzo- A 
ro okie right fielder, .Vl a d im ir 
Guerrero, made a strong throw 
to nail Hundley ax the plate. . 

“The last two games be has 
hit toe well, but there’ll be a 
time that I’ll come back and 

g it him,” Martinez said of 
aerga. “You can be sure of 

PadTM 5, Brawn 2 In At- 
lanta, after umpires reversed a 

call to take a two-run homer 
away from the Braves’ Keith 
Lockhart, San Diego scored 
three runs in the ninth. 

In foe eighth, Lockhart hit a 
ball into foe right-field stands 
that a rookie umpire C.B. 
Bucknor. ruled a two-run 
homer. After foe Padres sur- 
rounded Bucknor to protest, 
the umpires* crew chief, Ed 
Montague, changed the call. 
Television replays then 
showed that foe ball was fouL 
In foe ninth, John Flaherty 
brought home foe go-ahead 
ran with a bases-loaded groun- 
dnut, then Quilvio Veras ad- 
ded a two-out, two-run single. 

Ttods 3, PhffliM z Kent Mer- 
cker pitched 6VS strong in- 
nings and Willie Greene had a 
run-scoring double in a three- 
run sixth inning as Cincinnati 
won in Philadelphia. 

Cmftwb 15, RodowK 4 

John Mabry drove in six runs, 
Ron Gant had three hits and 
Royce Clayton went 5-for-6 
as Sl Louis won at home. 

WriH a, 0*8.1 In Chica- 
go, Steve Cooke allowed five 
hits in 7-/3 innings to help 
Pittsburgh stop Chicago’s 
first three-game winning 
streak this season. 

Hint* 9, Martin* 1 In 
Miami Bill Mueller and 
pitcher Shawn Estes hit their 
first major-league homers in a 
game called because of rain 
with one out in .the top of foe 
seventh. (LAT, AP) 


25 30 .4S5 7 

Major League STANMNas 












New York 









12 • 

Drinrit .. 
Boston , 

... -.-V 








■ • 














A 72 





























' 24 




mnom n i— TO 


Detroit 021 209 003-8 11 B 

(Mdand 2N 100 six— 9 13 0 

Blok; M. Myers (7), Mini (7L Battista (83 
and B. Johnson Wcngeit C Rows (5), A. 
Small (7). Taylor TO, MoNer (9), D Johnson 
TO and Mama. W — A. SmaA 5-1. U-M. 
Myers. U. Sw— O l Johnson CD. 
HRs— DetroA Nines 0), ftymrai TO, 
.,Hanwto OT..OaktnBd. Gfrnbl (7). McGwire 
Wh Bros) as 2 (4. 

Taranto 010 100 «01-3 7 0 

SsaMIs bos zu ow-s u 0 

W.WBRoros. Spoflarie ft). Crafctn* TO md 
SmBagai Maya; B.WHts C7). McCarthy TO, 
s. sanden CTO and 0. wnsoa.W-MoyecS-2. 
L— W. WHan* i-o. HRs— Toronto, C. 
Deioada TO. Seattle; Buhnar2(l4), Sorrento 
TO. Crux Jr TO. 

afcogo 100 150 101-9 15 • 

OoWtad 100 040 OHM 9 2 

D-DaMlrt C. Cutffio TO. T. Cwfflto TO, 
Kmdmer TO. RHemnmte TO and 


Fobngrs Ogea, Graves ft), Phmk TO, 






AsMnmadier TO and S. Alomar. W— D. 






Darwkv 2-2. L— Ogea 5-4. HRs-Chtaoga D. 






Martinez 2 (5). F. Thomas (14), Bella 035. 






Oevetond Thome 2 (ID. 






Boston IN 3M 090-4 11 9 






MB totals 001 019 112—6 12 9 


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Chile 2 Hungary 1 


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cicveiamd— R eleased OF Karin 


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Pugh for ansJenment - 

NSW YORK-Put OF Tbn Rabiw an 16<tay 
diaaMcd Bat Acttwded 2B Pat Kelly tan 15- 

HATTLK-Adtvofed RHP Alan Weskdfl 
from 15-day disabled Hsi. 


N i— SuspendedColorodo l B Andres Gakro 
n«a and Florida LHP Dennis Cook for 3 
Borneo and lined them undsdused amount 
pendSno appeal tar tadflng bench-deaitna 
brawl in Mny31 game. 

AnzoNA-SIpned RHP Jason Roparta ml- 
rror-league contract 

ancMW-Tmded INF Bobby Morris to 
Clovetond for 1 B Rod McOriL 

HousnMi-Signed OF Chuck Our and as- 
sfgrnd Mm to New Oriams, AA. 

LOS JWOELES-AcftoaM OF Brail Bulfer 
fmm 1 5-day disabled Bst Optioned OF E drfie 
Williams to AflMxpietiim PCL 

oxiAM DO— Named Chock Daty coach. 
i-HFLADClphia— N amed Gar Heard, Jolm 
Kuesksr and Marts Tuipean assManl coach- 
es, Kerin OCarmor dhechr of player per- 
sonnel ml BfflyWng rice president of bas- 
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ixwamapous— S igned s Robert Bladc- 

HEW enoland— S igned DE Therone Me- 
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ST. LOUts-SlgTwd OL Ernest Dye and 0L 
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Tlromas Homan, CB KemyMcEnlyre and P 
Greg toy- Released OLB Carte* Jenkins. 

SEATTLE— Signed DT Marc Splndler,S Tim 
Kauck and LB Glen Young. 

WASKmotoh— S igned LB Jamei WWtotns 
to 3-yea r conlroclondOT Joe Patton to) -year 
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The Peace Puzzle 

is good news and bad 
news concerning the NATO 
treaty just signed in Paris. The 
good news is that it makes 
World War III less possible. 
The bad news is that die 
people who sell arms around 
the world are going to have a 

With Russia and other East 
Bloc countries as signatories, 
the munition 
have a problem 
persuading the 
NATO partners 
to order new 
weapons for 
their armies. 

Willie Lo- 
man. who ped- 
dies Sherman 
tanks behind the former Iron 
Curtain, hasn’t written up an 
order in months. 

He told me, “No one is 
afraid of anyone anymore. I 
keep telling them the neigh- 
boring NATO country could 
turn on them at any moment, 
and they laugh at me. Then I 
tell them Yeltsin is bluffing 
and wants to use NATO to get 
his army in shape. They ac- 
cuse me of saying this just so 
I can sell them American 

I said, “Peace is hell. How 
can any country defend itself 
if it doesn’t have the latest 

“That is how everyone in 
die armaments business feels. 
All the merchants of death are 
hurting. Glider Submarines 
had three $7 billion boats can- 
celed when the Pentagon 
budget people discoverecTthe 
only thing the submarines 
would sink are fish. McDon- 
ald aircraft has a new plane 
that travels 1 0 times the speed 
of sound, but there is nothing 
else up there that can go that 
fast. The people who nego- 

tiated the NATO treaty had no 
idea how it would afreet un- 
employment in St Louis.” 

“Isn’t there any nation that 
would buy a Sherman 

“Yes, but we’re not talk- 
ing to them. I could get an 
order from Castro today, but 
the State Department won't 
let me write one. Iraq is a 
prospect, but we're not 
selling to them until they tell 
us where their poison gas is. 
The reason Russia signed the 
NATO treaty is that it wants 
to sell all its tanks and planes 
to the West. They’re under- 
cutting us every steppe of the 

“Willie, you were die best 
tank salesman there ever was. 
It isn’t your fault that every- 
one got sick of spending 
money on defense. Maybe 
you could start rumors that 
Hungary is mobilizing to at- 
tack Czechoslovakia. That 
might bring in some busi- 

“The Eastern Bloc is not 
buying. The only place where 
I’ve sold anything this year is 
Turkey, which can't get 
enough stuff to defend itself 
against Greece.” 

“Then what is the solu- 

“The one thing the NATO 
countries are interested in is 
equipping their military with 
Nike sneakers. 1 think I’ll sell 
them instead of tanks.” 

I slapped him on the 

“You’re onto something." 
I said. "There isn't an army in 
the world that doesn't need 
running shoes to get across 
the tundra.” 

Willie sighed. “Maybe 
someday every peace-loving 
country'in the world will or- 
der a Sherman lank — one 
that can be driven by men as 
well as women." 

In Celebration of Rudolf: Blockbuster in Prague 

By Jane Perlez ' 

New York Timer Service 

P RAGUE : — An extravagant 
art palron who reveled in the 
salacious as well as the scientif- 
ic. an emperor with many cour- 
tesans but never a wife, Rudolf 
II is being celebrated this sum- 
mer in Central Europe’s first 
blockbuster art show, an ex- 
hibition centered on the castle 
and city where he lived and 
starred 400 years ago. 

More than 1,000 p ainting s, 
sculptures, objets d'art, astro- 
nomical instruments and 
manuscripts commissioned 
and collected by Rudolf and 
now borrowed from museums 
around the world are on display 
at four sites here, including the 
newly renovated picture gal- 
lery at Prague Castle. 

From the imperial court high 
oo the hill to the aristocratic 
houses down in the city, the 

dazzling cultural spillover , 

from Rudolf s reign — a boom — ton-.Twi/Ap««R.w»-o 

in book printing, architecture The picture gallery in Prague Castle, one of four sites for the exhibition “Rudolf II and Prague, 
and Literature — is on show at . 

the Wallenstein Palace, a noble res- that the emperor created in his ex- and superstition, chemistry and al- and then succeeded him as emperor 

the Wallenstein Palace, a noble res- 
idence that retains some of its orig- 
inal 16th-century interior. 

The exhibition, simply titled 
“Rudolf 17 and Prague," is inten- 
ded to remind the world that much 
of the spectacular scientific and 

panding castle. cbemy, with an ovi 

Curious in intellect, imposing in that man was divine, 
physique — who can forget the To demonstrate this in the con- 
bulbous face peering out from text of the times, the chief curator, 
above a flounced lace collar, as Eliska Fucikova. an art historian 
painted by Hans von Aachen, or the who has been custodian of Prague 
voluptuous rendition of his visage Castle's art holdings under Pres- 
in fruits and vegetables by Giuseppe ident Vaclav Havel, has pulled to- 
Arcimboldo — Rudolf II attracted gether works from Russia, Poland, 

or uie spectacular scientific and painted oy Hans von /\acnen,orme 
cultural ferment of the late Re na is - voluptuous rendition of his visage 
sance took place in Prague, in ad- in fruits and vegetables by Giuseppe 

dition to the better researched cities Arcimboldo — Rudolf II attracted 
of Italy, France. Spain and the some of Europe’s best minds. He 
Netherlands. inspired them to work with and off 

cbemy, with an overriding sense of the Holy Roman Empire. Mat- 
rbaf man was divine. thias set up court in Vienna, takin g 

To demonstrate this in the con- with him precious ait. Shortly af- 
text of the times, the chief curat jr, terward, the Thirty Years' War ex- 
Fiislffl Fucikova. an art historian tinguished Prague as the light of the 
who has been custodian of Prague late Renaissance, and the sack of 
Castle's art holdings under Pres- the city by the Swedish Army in 
ident Vaclav Havel, has pulled to- 1648 meant that much of what re- 
gether works from Russia, Poland, mained was sold or plundered. 


In some ways, the show’s theme 

Hungary, Western Europe and the 
United States. 

each other in an exuberant milieu of 

Reuniting such works has meant 
negotiations with myriad institu- 

is very relevant “With all the talk creative collegiality. 

of us returning to Europe, this ex- 
hibit says we’re not going back 
anywhere, that we’ve always been 
in Europe,” said Robert B. Vunn, 
the show's general manag er 
“We’ve just been a bit isolated.” 

In Rudolf's day, the Habsburg 
court at Prague was the place to be. 
Painters, scientists, architects, 
goldsmiths and jewelers flocked to 
the city, eager to win the imperial 

Under Rudolf, Johannes Kepler, 
the court astronomer, rubbed 
shoulders with Joost Buergi, an in- 
ventor of logarithms. Bartbolotneus 
Sprang er, a court painter of alleg- 
ories depicting lusty women and 
robust angels, was favored along- 

The emphasis is on what Rudolf dons: This show has been a long 
himself commissioned in Prague time in the making. In 1968 there 
rather than on what he collected of were discussions about a Rudolf 
painters before his time, like exhibition sponsored jointly by 

BruegheL The exhibition, which 
runs through Sept. 7, is accom- 
panied by a hefty catalogue with 
250 color illustrations and 1,000 
others, published by Thames and 

side Roelandt Savery, a painter of Hudson. An American edition 
delicate landscapes. And all the priced at $75 is due in September, 
while, in this period just before the Rudolf’s sojourn in Pragae 
rationalist philosophy of Descartes began in 1583 and was cut short in 

this pen 

the city, eager to win the imperial rationalist philosophy of Descartes 
stamp of approval and to show off pervaded the world, Rudolfs court 
their work in the stately settings nurtured a lively mixture of religion 

Prague and Vienna. But plans came 
to naught when Soviet troops 
crushed the democracy movement 
known as Prague Spring. A Rudolf 
show was held in Essen, Germany, 
in 1988, and an extended version 
ran to huge acclaim in Vienna in the 
winter of 1989. 

But the Czechoslovak authorit- 

161 1 by his brother. Matthias, who ies, even with Fucikova, one of the 
organized an army to unseat Rudolf world’s foremost Rudolf scholars. 

on hand, were in no mood to 
play host to an exhibs&an &onj 
Vienna that exemplified the 
Habsbargs. Finally, with the 
end of Communist role and ^ 
enlistment of sponsors, chiefly 
the Czech Bank of Commerce, 
to share the $3 million cost, die 
show was put together. 

There have been some dis- 
appointments. At the last mo- 
ment Romania decided it 

would not send five rarely aecat 

paintings.. The Geoy Museum 
in California is in the midst of 
moving its Rudolf collection 
and would not pan with any 
pieces, Fucikova said. '. 

But the Kunsrhistorisebes 
Museum in Vienna obliged 
with 30 paintings, including 
Spranger’s “Triumph of Wis- 
dom.” More than " 120 art ob- 
jects — docks, vases, 
statuettes, bowls — have been 

sent from the museum's dec- 
orative arts department. 

The exhibition also presents 
an opportunity io unveil 
Rudolf* s gallery as newly dec- 
orated by Borek SipefcaCzech 
furniture designer and architect 
based in Amsterdam. Sipek has 
preserved the gallery ’s original line 
and form, in particular its vaulted 
doorways, but has added flourishes 
like a royal blue ceiling flecked 
with tiny lights for an entrance and 
a glass door with clean, modem 

Until recently, it was vognish to 
call Rudolf crazy, in part because 
he loved art more than politics. It 
was deemed odd that an emperor 
who should have had bigger things 
on his mind visited his artists while 
they were working, sometimes sug- 
gesting what they should paint. 

The revisionist version promoted 
at the Vienna exhibition in 1989 
and again here in Prague is that 
Rudolf was eccentric but certainly 
not mad. “To say he was crazy and 
unable to rule is completely 
wrong.’* said Dr. Karl Schuetz, the 
director of paintings at the Kun- 
sthistorisches Museum in Vienna. 
“But surely he was strange.” 



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FOCUS ON MARILYN — Workers hanging photographs for an 
exhibition in Barcelona, “Marilyn Monroe: 35 Years After Her Death.” 

T HE Russian-born pianist and con- 
ductor Vladimir Ashkenazy, who 
now is head of the Berlin Symphony 
Orchestra, will become chief conductor 
of the Czech Philharmonic next Jan. 1. 
Ashkenazy's appointment fills the va- 
cancy created by the resignation in 
January 1996 of the German conductor 
Gerd Albrecht, after months of bick- 
ering. Albrecht often used German me- 
dia to accuse Czechs of waging a cam- 
paign against him on national grounds. 
Czech media in return complained of 
Albrecht's lack of sensitivity in running 
the country’s premier orchestra. 

Chelsea Clinton’s senior prom was a 
family affair, with the 17-year-old first 
daughter taking her parents, a White 
House motorcade and a half dozen re- 
porters to her pre-prom party at a 
friend’s home. Arriving a! the party in 
suburban Maryland an hour late, 
Chelsea sported a dramatic black cape 
over a full-length silver-gray skirt 
splashed with large scarlet poppies and 
a sleeveless black top. Bill and Hillary 

Clinton emerged from the presidential 
limousine in casual business attire to 
greet Chelsea’s friend, Emily 
Hawkins, and her mother. Later, the 
kids went to their prom and the parents 
to a local restaurant. White House aides 
were tight-lipped about Chelsea's date 
status for the evening, but once inside 
the Hawkins home, she added a wrist 
corsage to her accessories. 

Matthew Perry has voluntarily 
checked into a treatment center to battle 
an addiction to prescription pain killers. 
His publicist, refused to give details 
about the 27-year-old "Friends” star 
except that he was in the “early stages 
of chemical dependency.” 

Technology is on a winning streak, at 
least in chess. Natan Sharansky. Is- 
rael’s trade minister, who mastered the 
game in Soviet prisons, lost an exhib- 
ition match against Deep Blue Jr., a 
slower version of the IBM computer 
that defeated the world chess champion. 

Garry Kasparov, last month. “Very 
quickly after the fust moves, I could see 
that it sees everything, it knows 
everything,’ ’ he said after a three-game 
match in Yorktown Heights, New York. 
Last October, Sharansky defeated Kas- 
parov in one of 25 simultaneous ex- 
hibition games the champion was play- 
ing. Sharansky, 49, a mathematician, 
spent nearly a decade in prisons before 
being allowed to emigrate to Israel. He 
said he played chess in his head during 
months of isolation. 

The daughter of the imprisoned mob 
boss John Gotti will write a combin- 
ation cookbook and family history as 
part of a new $ 1 million book contract. 
Victoria Gotti’s deal with Crown Pub- 
lishing calls for two novels and the 
cookbook/history, the New York Post 
reported. “It’D be something like Fanny 
Flagg's ‘Fried Green Tomatoes,’ the 
way it weaves stories with recipes.” a 
Crown editor. Sue Carswell, said. 
Gotti's first novel, “The Senator's 
Daughter.” sold about 50,000 copies, a 

strong performance for a new author. , ~ > j 

Her next novel, tentatively titled "HI * f t i .?-* J t ! * 

Be Watching You," is about the am- fw • ‘ r 

bitious young daughter of a gambling 1 

mogul. The writer’s father is serving a j , ? l 

life sentence for murder and racket- 1 [/|^ i*Z '~ ! * 

eering. She has said he reads all her 

work and offers suggestions before it ; n • • f ' 

goes to tiie publisher. • ji jj * j * ; ? 

. O | 

Don Newcombe wants to pitch his L lt , 

case against Coots Brewing Co. to a •! L.H / * : J - •• ■ ' 
jury. A beer ad used a likeness of the ? 

former Dodgers pitcher, a recovering ___ 
alcoholic, without his permission, and ; 
he is entitled to a jury trial to determine 
if his rights were violated, his attorney — - 
says. A three-member panel of the 9th 
U.S. Circuit Court of Appeals heart • 
arguments in a request to reinstate New- 
combe's lawsuit against Coras, which a 
federal judge dismissed in December - 
1994. Newcombe. 71, a Cy Young . 

Award winner, retired from an 11 -year . 
baseball career in 1960. Since then, he 
has become an advocate for anti -alcohol _ 
programs for professional athletes. 

r j i-j * 

all the tea in 10811 . 

Every country has its own AT&T Access Number' 

which makes calling home or to other countries really ' ; 
easy. Just dial the AT&T Access Number for the country 
you're calling from and you’ll get the fastest, clearest 
connections home. And be sure to charge your calls - 
on your AT&T Calling Card. It'll help ypu avoid out- 
rageous phone charges on your hotel bill and save you ; T ! 

up to 60%* (remember that old Chinese proverb- 
a yuan saved is a yuan earned). Check the list below 

for AT&T Access Numbers. 


\ i 

rp|» >11 £ 

Steps lo folio* for can tilling »orU*ide: 

1. Just dial the AT&T Aec&s Number for the country you 
nre calling from 

Dial the phone numbin’ you 're calling 
3- Dull the calling caul number hst*»i abow yuur name 

036 DOO 6780 1111 



Cacti Republic* 




Ireland ... 


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AT&T Aerate fluwihgr* 

HW-Itt-t* untied Onstan*. 


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• 1-000-550-000 Saudi Arabia o 

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.755*5042 Kenya* 

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