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Paris, Monday, June 16, 1997 

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The World's Daily Newspaper 

j-. «.• 

No. 35.S4S 

Stakes Are High as EU Leaders Garner for Summit 

Unspeakable Reality: Cautious Optimism 
Europe ’s Falling Apart For Deal to Save Euro 

__ _ W« 1b*i*iVWouich 

The police in Amsterdam battling marchers protesting unemployment over the weekend. The demonstration 
started peacefully, but grew violent when protesters neared the building where ELI leaders will meet this week. 

By Edmund L. Andrews 

V«n 1»t/ TiHit S Seri i, ,■ 

FRANKFURT — When European leaders meet in Am- 
sterdam on Monday, they will almost certainly portray them- 
selves as solidly united in the last mile of a historic project: (he 
introduction of the euro, the celebrated single European cur- 
rency envisioned as a big step toward a fully united Europe. 

The reality will be different. Having been pushed further 
than most people ever thought possible, the euro is pulling 
Europe apart at the seams. 

In the last three weeks. France's conservative prime min- 
ister has been defeated. In Germany, the center-right coalition 
under Helmut Kohl is paralyzed bv its worst budgei crisis in 
decades, and Mr. Kohl's government is indanger of following 
France's lead. Old national animosities have also flared: The 
French are rebelling at German rigidity: the Germans are 
suspicious of Italy's financial management; Italians are ra- 
ging at being treated like second-class Europeans. 

European leaders narrowly avoided a meltdown last week 
after France's new Socialist government abruptly balked at 
taking the next step toward a single currency by refusing to 
sign a crucial agreement on enforcing fiscal discipline. Lead- 
ers now appear ready to paper over the dispute in Amsterdam 
by accommodating France w ith vague language emphasizing 
the importance of creating jobs. 

See REALITY, Page 7 

Contemplating a world without the euro. Page 7. 

By Tom Buerkle 

Ini, » «.<n. ■■)■>< Jl. ii:i'}rn 

AMSTERDAM — The leaders of the European Union 
arrived here Sunday for what promises to he one ot their nu»>t 
contentious summit meetings in years, as senior otliciaU 
worked frantically to bridge" a huge economic-policy divide 
between France 3nd Germany that threatens Europe's plans 
for a single currency. 

Finance ministers from the 15 EL 1 countries met over 
dinner Sunday evening in a bid to reconcile Germany's 
insistence on strict monetary discipline \\ ith French demands 
tor programs to stimulate growth and jobs. 

Officials expressed cautious optimism that the leaders 
would be able 10 reach a compromise when the iwo-dav 
meeting begins Monday. 

Prime Minister Wim Kok of the Neiherlands. w ho will lead 
the meeting as holder of the Union's rotating presidency, 
spoke by telephone over the weekend with Prime Minister 
Lionet Jospin of France and Chancellor Helmut Kohl of 
Germany and fell “confident that a deal can be struck." one 
Dutch official said. 

Prime Minister Jean-Claude Juncker of Luxembourg, who 
in December helped broker an earlier French-German com- 
promise on the stability pact, said he had had "sufficient 
contact to know that we will have success." 

See SUMMIT. Page 7 

Conflicting ideas about the road to EMI*. Page 7. 


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Turn Tables 
On Ireland 

j An Illegal Influx 
Searches for a Taste 
- Of Economic Success 

By James F. Clarity 

A <n- York Tme\ Scnur 

DUBLIN — For the first rime in its 
history, Ireland, a nation proud of the 
achievements of the millions of eco- 
nomic and political refugees it has sent 
to other countries, is suffering an im- 
migration problem. 

The largely illegal influx in the last 
two years of more than 3,000 foreigners, 
tiny for most countries but enormous by 
Irish standards, has overwhelmed the 
government bureaucracy and the legal 
system. The bureaucracy needs new 
regulations to deal with the flow, and 
private agencies say they are unable to 
find enough lawyers to handle the im- 
migrants’ cases at no charge. 

Some of the foreigners, most of 
whom are from Romania, Congo and 
Somalia, have stirred outbursts of ra- 
cism in this homogenous country of 3.5 
million people where it is rare to see a 
\ brown or tan face on the street. 

More than 50 refugees are arriving 
every week, a rate expected to double in 
coming months. Five years ago, the rate 
was less than one a month. 

The immigrants, government offi- 
cials say, have been attracted by reports 
of Ireland's economic surge, and by 
reading advertisements on the Internet 
and hearing by word of mouth of agents 
selling nips to Dublin, most of them 

Such trips cost from 53,000 from 
Eastern Europe to 55,000 from Africa, 
the two areas producing most of the 
refugees. The ads also describe the so- 
cial welfare benefits available to 

The seriousness of the immigrant 
situation has attracted the attention of 
Bertie Ahem, who is expected to be- 
come prime minister in three weeks. He 
took time put from the election cam- 
paign last week for a visit to the Irish 
Refugee Council, a private aid group, to 
. be briefed. 

One immigrant at the council office 
lok! his story. 

The ■ man . Bcllahi Brahim-vell, 35, 
said he was a former Mauritanian dip- 
lomat, a member of the Tuareg minor- 
ity.- who had been serving a prison term 
in his country for political subversion. 
He said he had formed a group that 
^ accused, the president of permitting the 
buying and selling into slavery of Tu- 
i aregs. 

“Classical 19th-century slavery,’ ’ he 
said. *T am Tuareg. So they sentenced 
me to seven years for subversion. I 

_ See IRELAND, Page 9 

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Kuwait—. 700 Fte U.5. hB. iEur.)--$l-20 

China Girds for a Leap Up the High-Tech Ladder 

Bi n ns 






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By Steven Mufson 

Washington Post Service 

WUXI. China — Nearly 40 years 
ago. the Communist government set up 
a state-owned enterprise here to bake 
ceramic plates and cups. Today, after 
merging with an ailing machine-tool 
maker, the transformed company is 
churning out sophisticated washing 
machines with computerized control 

“We use fuzzy logic.” said Guo 
Liang, a production manager at Wuxi 
Little Swan Co., describing the tech- 
nology that enables the machines to 
measure the size and dirtiness of laun- 
dry loads and to calculate how much 
water and detergent should be added. 
With production of more than a million 

washing machines a year, the company 
is looking beyond the Chinese market 
and expects to export 10 percent of its 
machines this year. 

Wuxi Little Swan is pan of a larger 
trend in the Chinese economy, which is 
growing and creeping up the technol- 
ogy ladder at the same time. Once 
primarily an exporter of teacups, toys 
and textiles, China is moving beyond 
Barbie dolls and silk ties to televisions, 
washing machines and even com- 

With eyes not only on the domestic 
market but also on possible exports, 
high-technology multinational compa- 
nies — including Applied Materials 
Inc., Intel Corp. and Hewlett-Packard 
Co. — have set up shop in China. 
Home-grown Chinese companies such 

as Legend Computers are exporting to 
the United States, eating into the Asian 
market shares of U.S. computer 
makers and driving down prices in the 
Chinese market. 

In Wuxi, local leaders have carved 
up 230 hectares (570 acres 1 of rice 
paddies and turned it over to a Singa- 
pore-based management company that 
is trying to create a slice of Silicon 
Valley on this flat, humid plain two 
hours' drive from Shanghai. 

It has built its own power plant, 
drinking-water system, playgrounds, 
school, villas and golf driving range 

nology Inc., which makes disk drives 
for computers, has invesred here, as 
have Matsushita Refrigeration Co. and 

the German industrial giant Siemens 

In a drive to duplicate the success of 
other Asian economies. China's polit- 
ical leaders are striving 10 promote the 
country- ’s technological advances. But 
unlike postwar Japan, which went 
from making handicrafts to cameras to 
televisions to automobiles, the Chinese 
government wants to do everything at 

In an effort to take a technological 
great leap forward, Beijing has 
launched “Project 909,” a multibil- 
lion-dollar plan to boost Chinese semi- 
conductor production. Last month. 
NEC Corp. of Japan agreed to invest 
$1.2 billion in a joint venture with a 

See HIGH TECH, Page 13 

Conspiracy Theory Lingers 
After Bomber’s Sentencing 

Did Others Take Part in Oklahoma Attack? 

By Jo Thomas 

New York Times Service 

DENVER — Even amid ail the talk 
that the conviction and death sentence 
of Timothy McVeigh in the Oklahoma 
City bombing have achieved some mea- 
sure of “closure” for victims, their trau- 
matized families and an outraged Amer- 
ican public, the questions remain. 

They lingo-even after seven weeks of 
trial dozens of witnesses and hundreds 
of pounds of physical evidence, all of 
which added up to an overwhelming 
case against Mr. McVeigh. 

Did anyone help him assemble the 
materials for the huge bomb that took 
1 68 lives? Did anyone help him build it, 
and, if so, where did they do it? If there 
was an even broader conspiracy, who 
was involved? 


In deciding Friday that Mr. McVeigh 
should die, the U.S. District Court juiy 
did not heed the plea of his lawyer. 
Srephen Jones, that the execution of Mr. 
McVeigh might somehow prevent the 
frill truth about the Oklahoma City blast 
from ever being known. 

In veiled language, Mr. Jones hinted 
ai a broader plot that Mr. McVeigh 
would not disclose and, because he is 
Mr. McVeigh's lawyer, be himself 
could not disclose. * ‘You may well con- 
sider," he told them, “that two people 
share a terrible secret One of them will 
not tell you and the other one cannot by 
his oath of office, but die one that can, 

“The chapter — the book of the 
Oklahoma City bombing — is not 
closed. Do not close it Do not permit 
others to close it Let there be a frill 
accounting, not a partial accounting.” 

Mr. Jones, who was effectively 

barred from building his defense around 
what many regarded as far-flung world- 
wide conspiracy theories, had an op- 
pomin ity to advance this notion after the 
jury gave his client the death penalty, 
saying in one television interview that 
“there is a growing amount of evidence 
that they, tike the government, would 
want Mr. McVeigh executed." 

Such comments by Mr. Jones are 
likely to fuel the most extreme con- 
spiracy theories, already making their 
way on the Internet and far-right talk 
shows on short-wave radio. One theory 
says the government itself was involved 
and used Mr. McVeigh as a fall guy. 

In the sentencing phase of the case, 
Joseph Hartzler, the lead prosecutor, 
responded to Mr. Jones’s pleas by ur- 
ging the jurors not to base their decision 
on what Mr. McVeigh might decide to 
say someday. “All indications from 
what you've seen through this process is 
we’re never going to hear from him,” 
Mr. Hartzler said, "Forget about 

But investigators have never offi- 
cially ruled out the possibility that oth- 
ers were involved, and almost from the 
beginning there has been a deep debate 
within the U.S. Justice Department over 
whether Mr. McVeigh acted alone, driv- 
en by his hatred of the government, or 
had co-conspirators in the shadowy un- 
derworld of the extreme right 

Indeed, the original indictment 
against Mr. McVeigh and another de- 
fendant, Terry Nichols, charged that 
they conspired with “others un- 

Still, there is no active investigation 
of the bombing, though Justice Depart- 
ment officials have said they have in- 
creased their ability to examine the far- 
right groups and are willing to pursue 

See VERDICT, Page 9 

A newspaper's special edition on the verdict being displayed in Denver. 


Tudjman Is Favorite as Croatia Votes 

ZAGREB, Croatia (Reuters) — 
Croatia voted Sunday for president, 
but the only real question was how 
large Franjo Tudjman 's margin would 

President Tudjman, 75, was expec- 
ted to win a second five-year term 
easily. He ran a vigorous campaign 

despite medical reports that he has 
stomach cancer. Voting ended at 7 
P,M. Final results will not be known 
until Monday or Tuesday. 

Mr. Tudjman, who led Croatia to 
independence in 199 1, told reporters as 
he voted that the country would be 
"rich and democratic” if he won. 

Airbus Flies 
At Boeing’s 

Consortium Plans 
Larger Long-Haul Jet 
To Compete With 747 

By Barry James 

Intirnjiioiidl HrrdlJ Trihiun 

PARIS — The European Airbus con- 
sortium said Sunday it intended to chal- 
lenge Boeing Co.'s monopoly on aircraft 
larger than 350 seats by stretching its 
four-engine A340 model to carry as many 
as 378 passengers on long-haul routes. 

The president of Airbus Industrie. 
Jean Pierson, said at the Paris Air Show 
at Le Bourget that the four-nation part- 
nership was in final negotiations with a 
number of airlines and hoped to start the 
project in September. 

The aircraft, the A340-600. is de- 
signed to replace earlier model Boeing 
7475 as they reach the end of their 
operational lives while offering signif- 
icantly improved fuel costs and effi- 

Mr. Pierson said Airbus was con- 
tinuing with its project to build a su- 
peijurabo, the A3XX, capable of car- 
rying at least 550 passengers. He said, 
however, that the consortium had to 
proceed cautiously on a project that 
could cost more than $9 billion and 
produce a type of aircraft that would 
probably still be flying when Airbus 
celebrates its centenary. Airbus plans to 
make its final decision on the project in 
1 998 and to deliver the first planes early 
in the next decade. 

Although it is flush with orders. Air- 
bus’s prospects have been clouded by 
uncertainties over its future corporate 
status and by Boeing's planned takeover 
of McDonnell Douglas Corp. By signing 
three of the world's five largest airlines 
— all of'them McDonnell Douglas cus- 
tomers — to 20-year exclusive deals. 
Boeing has made it ‘ ‘more difficult if not 
impossible" to make a profit on new 
programs, Mr. Pierson said. 

The $2.5 billion A340-600 project is 
designed to break Boeing's strangle- 
hold on a highly profitable market sec- 

See JUMBO, Page 13 


Calling ET: The Party's On for July 


Page 9. 


— Pages 20-22. 

The Intemwrket 

Pago 10 . 

1 The IHT on-line 

http:/, 1 1 

Bucking Public and Courts 9 Clinton Calls for Affirmative Action 

By Joan Biskupic 

Washington Past Service 

WASHINGTON — In making a call over the 
weekend for a renewal of affirmative-action pro- 

S ai America's universities. President Bill 
n is bucking public opposition to such 
policies and increased skepticism in the nation s 

courts. ,. 

A recent poll showed that only one in six wmtes 
but nearly half of all blacks believed that minorities 

should receive preference in college admissions. 
And the Supreme Court has said that race should not 
be considered, either positively or negatively, and 
that people are * 'more than mere racial statistics.’ ' 


What this means is that Mr. Clinton — as he tries 
to make improved race relations a national goal 
and a personal legacy — must deal somehow with 
both resistance by whites and by judges who 

believe the constitution does not allow government 
to categorize people by race, even to benefit those 
who have long been disadvantaged. 

With many in America appearing to think it is 
time to put race aside and stop seeking remedies for 
past segregation, the president will have 10 demon- 
strate why special attention for blacks, Hispanics 
and other minorities is necessary to breach the 
racial divide. 

The Supreme Court has said that race-based 
policies generally “reinforce the belief, held by too 

many for too much of our history, that individuj 
should be judged by the color of their skin ' ’ 

In a speech Saturday at the University if Ca 

J™ m ? an ,? ieg0 ’ Clinton told gradual 
that they should engage in “a candid conversati 
on the state of race relations today” to nrenan* h 
the day when the United Stales will haveS. 
racial or ethnic majority. * 

“If, 10 years from now, people can look ba 

See CLINTON, Page 9 



PAGE mo 

Fascination With Aliens / 50 Years After Roswell 

UFOs: Believing Without Seeing 

By Amy Haimon 

'New York Times Sen ice 

R OSWELL, New Mexico — Squint hard 
enough against the bright desert sun. true 
believers say, and you cannot help but 
make it out — the bum where the space- 
ship crashed against the red-streaked rock, the dent 
like a giant heel print that it left in the bluff, the 
protrusion off to the right where military policemen 
found the alien holding a small black box on that 
fateful July morning in 1947. 

Hub Cora, whose sheep ranch happens to contain 
the site of the most momentous event in the hazy 
history of flying saucers, charges $15 for a viewing: 
But he doesn’t give his visitors the hard sell. He 
doesn't have to. 

“When I First started doing this, 1 was afraid in 
my own mind that people weren’t really getting 
what they wanted,' ’ Mr. Corn said. “I felt like 
everybody that come out would want to see a 
spacecraft, or at least some material. But people 
seem happy just to be here. They seem happy to 

Or at least willing to believe. Fifty years after 
what has become known in ufology circles as the 
“Roswell Incident,’* America's fascination with 
unidentified flying objects has never been more 
intense, or as widespread. 

More than 100,000 sky watchers and conspiracy 
enthusiasts are expected to attend die golden an- 
niversary celebration here during the first week of 
July, according to event organizers. Festivities will 
include an all-night “rave” dance party at the Corn 
ranch and a soapbox derby-style race of homemade 
alien vehicles. 

Such summer merriment in the desert, where 
temperatures can rise to 1 10 degrees Fahrenheit (43 
degrees centigrade), is testament to the emergence 
of a mainstream belief in UFOs. A recent Gallup 
poll found that 42 percent of American college 
graduates believe that flying saucers have visited 
Earth in some form. 

Thousands of Americans have reported being 
abducted by aliens in recent years. And John Mack, 
a psychiatry professor at Harvard Medical School 
who was subjected to a harsh review by the school in 
1995 after publishing his view that many of these 
reports are true, is gaining adherents and will be a 
keynote speaker at the Roswell weekend. 

Attribute it to concern over the approaching 
millennium or anxiety over technology that ad- 
vances faster than a layman can understand. Chalk it 
up to the public's suspicion of official Washing- 

Whatever the causes, the long-held tenets of the 
flying saucer buffi — aliens are visiting us, and the 
government knows it and is covering it up — now 
permeate the public consciousness ana popular 

The hit television series “The X-Files” features 
two agents of the FBI looking into just such a cover- 

“There are millions of Americans who probably 
know more about aliens than they do about ther- 
modynamics.” said Benson Saler. an anthropology 
professor at Brandeis University and co-author, 
with Charles Ziegler, of “LIFO Crash at 

Mr. Safer sums up the common wisdom this way: 
“We know what they look like — they’re tall and 
slender with huge heads and almond eyes. And the 
hope is that these beings with superior technology 
will enter into communion with us and help solve 
our problems.” 

The book maintains that the Roswell story has all 
the elements of a modern myth, serving as an 
expression of ami-government sentiment and the 
age-old yearning to believe we are not alone in the 

l U-rartV WHo 

Deon Crosby ; director of the UFO 
Museum and Research Center in 
RosicetL presenting a life-size model 
of an alien that is said to have been 
found at the crash site in 1947. 

Scientists and skeptics have warned that the 
embrace of pseudoscientific ideas like alien vis- 
itation and abduction threatens to undermine the 
critical thinking by an educated public that a demo- 
cratic society requires. 

Critics point to the recent suicide of 39 members 
of the Heaven's Gate cult, who believed a spaceship 
traveling behind a comet would cany than to the 
“next level,” as a tragic result of the blurring of 
science and science fiction. 

But it may be hard to dispel the popular belief in 
superior technological beings, whose very exist- 
ence is beyond the means of scientists to verify or 

L ike r 


IKE most legends, the Roswell tale traces 
[enesis to a real event. In early July 
a ranch foreman. W.W. Brazel. 
found strange, shiny material littering the 

S ound near Roswell, in southeastern New Mexico. 

e turned the material ova to the sheriff, who gave 
it to die military authorities at the air base here. 

On July 8 of that year, the army air forces issued 
a news release about the landing of a ‘ ‘flying disk. ” 
This resulted in a headline in the local newspaper. 
The Roswell Daily Record, that said. “RAAF Cap- 
tures Flying Saucer on Ranch in Roswell Region." 

Military officials recanted the next day, calling 
the curious debris merely a downed weather bal- 
loon. With that, the matter was largely forgotten 
until the early J 980s, when the first of more than a 
dozen books on the subject was published. 

These versions of the Roswell story variously 
held that Mr. Brazel, who by then had died, was 
harassed into abetting what was said to be a gov- 

ernment cover-up; that the crippled craft crashed on 
what is now Mr. Corn’s land, and that the military 
retrieved three to five alien bodies, which may now 
be stored in another stronghold of UFO lore, the 
Area 5 1 military installation in Nevada. 

In 1 994, aiming to defuse speculation about what 
happened at Roswell, the air force issued a 1,000- 
page report disclosing that what it had claimed was 
a weather balloon was in fact a classified ex- 
periment designed to detect nuclear tests conducted 
by the Soviet Union. 


UT for a suspicious populace — 71 per- 
cent of Americans polled by Gallup say 
they believe the government knows more 
about UFOs than it lets on — the air force 
report did little to deter the cover-up theorists. 

The most persuasive evidence for many museum 
visitors are the statements in books and videos of 
Roswell residents and retired military employees who 
say they took part in die events as they unfolded. 

In a recently released book, “The Day After 
Roswell. ’ ’ Philip Corso, who served on the National 
Security Council under President Dwight Eisen- 
hower, contends that he personally directed an army 
project that transferred to the military technology 
recovered from the alien ship that crashed. 

The nation’s interest in UFOs began at the dawn 
of the atomic age, when fears over the Cold War and 
anxieties about new doomsday technologies co- 
incided with thousands of reported sightings in the 
years that followed the Roswell incident. 

“What's happening is science and technology 
have accelerated to apoint where they may be beyond 
our ability to comprehend,” said Chris Carter, cre- 
ator of “The X-Files.” “We need mysteries, we need 
stories, we need something beyond the temporal." 

Of course, many of those publicizing and per- 
petuating the Roswell myth are also malting money 
from it. Motel owners say about one-fourth of their 
■reservations are alien-related. 

“Do I believe it?" said New Mexico’s tourism 
secretary, John Garcia. * ‘Sure I believe it — all the 
way to die bank.” 

Cohen Presses Saudis ^ 
On Bomb Investigation 

Riyadh Vows Tull Cooperation 5 With FBI 


OwpMte Our SxffFnmDcparhn 

JIDDA — The U.S. defense secre- 
tary, William Cohen, pressed Saudi 
Arabian leaders on Sunday to provide 
more information to the FBI in the in- 
vestigation of a terrorist bombing in 
Saudi Arabia last Jane that killed 19 
U.S. troops. 

After a meeting in Jidda with Crown 
prince Abdullah ibn Abdulaziz and die 
Saudi defense minister. Prince Sultan 
ibn Abdulaziz, Mr. Cohen said Prince 
Abdallah had promised that “full co- 
operation would be given” in the in- 
complete Saudi bombing investigation. 

The FBI has complained about a lack 
of Saudi help in investigating the track 
bomb blast at Khobar Towers military 
housing complex in Dhahran last June 

No one has been found responsible 
for the attack, and it has not been de- 
termined whether an outside country 
sponsored it. 

“1 don’t have the specifics of what 
the FBI needs,” Mr. Cohen said aboard 
his aircraft en route to Kuwait from 
Jidda on the second leg of a Gulf visit 
“But I just indicated that they felt that 
they needed more information." 

Mr. Cohen was to meet with the 
Kuwaiti defense minister later Sunday 
evening and the emir Monday morning. 
He is also traveling to Bahrain, the 
United Arab Emirates and Oman. 

Mr. Cohen said be discussed with 
Saudi leaders the U.S. policy of dual 
containment of Iran and Iraq, and was 
assured by the crown prince that it re- 
mained the policy of Saudi Arabia as 
welL ( Reuters . AFP) 

■ U-S.-Iran Ties Could Improve 

Philip Shenon of The New York Times 
reported earlier: 

Mr. Cohen said the United States was 
‘ ‘skeptical but hopeful ’ ’ about the pros- 
pect of improved relations with Iran as a 
result of last month’s landslide election 
of a relatively moderate cleric as Iran's 

But be said that efforts by the United 
States to isolate Iran diplomatically and 
economically would not end until there 

tier pressure 
ana Middle 

was “demonstrable evidence that then 
has been a change” in Iran’s policy of 
supporting terrorist groups. 

“We need to see some signs on the 
part of the Iranians that this does in fact 
mark a change,” Mr. Cohea said aboard 
an air force Jet en route to Jidda. 

“As-long as- they continue to support 
terrorism, as long as they continue to 
develop weapons of mass destruction, 
as long as they try to upset the Middle 
East peace process, that our policy i$ 
not going to change,” he said of the 
Iranians. “There’s hopefulness that this 
recent election represents a change, but 
we’ll have to wait and see.” 

- Despite suggestions from U.S. and 
Saudi intelligence officials that Iran was 
tied to die terrorist bombing in Saudi 
Arabia last year that killed 19 American 
airmen, Mr. Cohen said: “So far, the 
evidence is still inconclusive. The in- 
vestigation continues, and we're not go- 
ing to make any prejudgment on that. 1 

The United Slates is under 
from some of its European : 

Eastern allies to consider changing its 
policy toward Iran as a result of the 
election of the new president, Mo- 
hammed Khatami, a former culture 
minister who won support from many 
Iranian women and young adults seek- 
ing an end to the government's strict 
social controls. 

Mr. Cohen said be saw nothing wrong 
— and perhaps some good — in recent 
moves by some moderate Arab nations 
to open new lines of communication 
with Iran. * ‘To the extent that they cany 
out dialogue, that they can get infor- 
mation that would be helpful in de- 
termining whether there's been a 
change in policy on the pan of the 
Iranians, I Think that’s helpful,” he 

He said, however, that he saw no sign 
of a change in attitude among Saudi 
leaders toward Iran. 

“I'm satisfied that Saudi Arabia re- 
mains very solid in its opposition to the 
policies that Iran has conducted over the 
years,” he said. “They have strongly 
supported our containment policy of 
both Iraq and Iran.” 

Brazzaville Peace Parley Is Set 

Envoys Go to Gabon as French Wrap Up Evacuations 

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Chiumel Reopens to Rail Freight 

LONDON (AFP) — Freight-train traffic resumed through 
the Channel tunnel Sunday for the first time since a dev- 
astating fire last November, the tunnel operator Eurotunnel 

Several track drivers were treated for smoke inhalation 
aftera fire broke out Nov. 18. 1996, on a freight shuttle train in 
the tunnel. The blaze severely damaged more than 600 yards 
(550 meters) of tunnel, and repairs were only completed last 
month. Although passenger service quickly restarted after the 
blaze, the freight shuttle service was suspended. 

Tate Gallery Is Evacuated After Fire 

LONDON (AFP) — An electrical fire under the Tate 
Gallery led to the evacuation of the popular museum and 
forced the gallery’s staff to remove about 40 works of art. 

There were no casualties or damage, and the fire, which 
broke out in anelectrical cable under one of the exhibition halls 

of the gallery Saturday, was 
quickly extinguished. The 
museum reopened Sunday. 

400 Flee Indonesian Volcano 

Agence France-Presse 

JAKARTA — About 400 people 
have been evacuated from the slopes of 
Mount Karangetang on the northern In- 
donesian island of Siau. The 1,785 meter 
(5.900 foot) volcano’s eruption has 
killed three people, reports said. 

CoafiMby S^F’rmDap^rhn 

BRAZZAVILLE, Congo Republic 
— France wrapped up its airlift of for- 
eign nationals from the embattled Congo 
Republic capital on Sunday after new 
shooting around the international air- 
port, and prepared pull out its troops. 

Two evacuation flights left Sunday 
after supporters of the former military 
leader, Denis Sassou-Nguesso. shelled 
government loyalists at the airport, fol- 
lowing two days of relative calm. 

Envoys of President Pascal Lissouba 
and General Sassou-Nguesso, his pre- 
decessor, a former Marxist military 
leader, took advantage of the same lull 
in firing and left for peace talks in 
Gabon, traveling on the same plane. 

The 1,250 French troops are due to 
withdraw over the next few days, de- 
spite appeals from both warring factions 
to remain as a buffer force. 

The fighting started June 5 after the 
army surrounded General Sassou- 
Nguesso’s home as part of a crackdown 
on private militias and unauthorized 

weapons in the run-up to a July 27 
election in the former French colony. 

Militia loyal to General Sassou- 
Nguesso advanced on the airport Sun- 
day and bombarded troops loyal to Mr. 
Lissouba from 2 AM. until midday. 

The barrage followed two days of 
relative calm and diplomatic efforts to 
end more than a week of ethnic and 
political killing. The two sides declared 
a truce on Wednesday. 

Mr. Lissouba. interviewed by Radio 
France International on Sunday, called 
for the election to take place as planned 
and repeated a call for an African peace 
force to oversee polling. “These elec- 
tions must take place,” he said. “De- 
mocracy cannot be negotiated.” 

Genoa! Sassou-Nguesso did not rule 
out the idea. “The international com- 
munity must organize the elections, 
check them and ensure security,” he 
said on the same radio station. 

France has evacuated aknost 5,000 
foreign nationals, about a third of them 
French. ( Reuters . AFP) 





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>iub Invest ijf q * ‘Close-Kmt’ McVeigh Jury Battled to Control Emotions 

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By Adam Nossiter 

Vwr York Tunes Seti'u- i- 

. LOVELAND, Colorado — A 
struggle went on inside ihe jury 
room in the hours and days leading 
up to Timothy McVeigh's convic- 
tion and death sentence. But the 
conflicr was not between or among 

Instead. it was a bartie between 
"the raw emotion they felt over the 
testimony about the carnage caused 
by the bombing in Oklahoma City 
on April 19. 1995 — emotion that 
spilled over into frequent tears for 
some — and stem judicial injunc- 
tions to keep sentiment and reas- 
"oning strictly separate. 

This common internal conflict 
bound them together, several jurors 
suggested in interviews Saturday, as 
did a' shared bafflement at the mys- 
‘tery of Mr. McVeigh, 29, and his 

murderous act. 

' The result, the jurors suggested, 
was an unusual degree of closeness 
throughout the deliberations and a 
final decision that was wrenching 
but hardly contentious. From the 
start. they said, there was little dis- 

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sension on the central questions of 
guilt and punishment. 

"We were a verv close-knir 
group/ * said Vera Chubb, 65. sitting 
in her living room in this pleasant 
lake-front city 50 miles (80 kilo- 
meters ) north of Denver. 

"From Day I, our personalities 
were very close." she said. "We 
meshed well together. If we had 
questions, we could always sit down 
and talk it out.” 

Another juror, Fred Clarke, 42, a 
retired Air Force veteran and com- 
puter programmer, said. "It was not 
tense by any stretch of the ima- 

A third juror, Tonya Stedman. 24, 
a waitress, connected the tension 
inside the room to the emotional 
impact of the testimony but agreed 
on the essential unity of the jurors. 

‘ ‘Tension, yes, emotion, yes. but I 
think we were very unified in the 
sense that we worked weLI together 
and we appreciated everyone’s 
opinion, and we agreed to disagree 
at times,” Ms. Stedman said in an 
interview outside her Denver 

There were plenty of surface dif- 

ferences among the jurors: one was 
a * ’Deadhead," an ardent fan of the 
rock group the Grateful Dead: oth- 
ers were straight-arrow military vet- 
erans or offspring of veterans, and 
one professed himself to be an en- 
thusiast for Rush Limbaugh. the 
conservative radio talk-show host. 

But even before the five women 
and seven men began, their delib- 
erations, a number of elements ap- 
peared to bind them together. 

Most seemed to pay close atten- 
tion throughout the weeks of testi- 

All expressed varying degrees of 
willingness to impose the death pen- 
alty. Most expressed a lack of in- 
terest in. or disdain for, the news 

These ties served them well once 
the deliberations began. 

The jurors also seemed to share a 
sense that a terrible mystery lay at 
the heart of the case, even as they 
methodically reviewed, day by day, 
year by year, the events of the de- 
fendant’s life. 

"We all sat there and rried ro 
figure out why a young man would 
do this." Mrs. Chubb said, shaking 

her head slowly. "I'd like to know 
what really got him started this way. 
It's just a mystery. 

“A lot of us said, we just don’t 
understand,” she added. "He 
planned this for almost two years. 
He could have stopped at any lime 
along the way.” 

For the jurors, horror at the crime 
that had been so intricately laid out 
for them was mixed with the know- 
ledge of the wrenching decision 
they would have to make at the 

"Yes, emotions in delibera- 
tions,” Ms. Stedman said. "To say 
no would be ridiculous. We’re talk- 
ing of convicting a man of guilt for a 
huge crime” and deciding whether 
to apply the death senrence. 

There were times. Mrs. Chubb 
said, when the effect of the day's 
testimony was overwhelming. 
"Some days, you would come home 
and think. I’m all right, then for 
some strange reason, tears would 
come to your eyes.” 

Mr. Clarke said he was conscious 
of the need ro keep feeling and anal- 
ysis apart. 

"I might have shed a tear or two 

during the victims' testimony, but 
nothing I needed a tissue for.” he 
said. "My job was just to sit there 
and listen, not to get emotional but 
to listen and assimilate the infor- 
mation. I equate it to putting to- 
gether a puzzle.” 

When the time came for ihe final 
decision about Mr. McVeigh's fate, 
the jurors became especially meth- 
odical, Mrs. Chubb said. 

"We said, this is a young man's 
life,” she said. "We have got to give 
it every thought, every prayer. 
Everything we could think of, we 
went over. 

"You know what a terrible thing 
he did. But when you have never had 
to do it." she said, referring to im- 
posing the death sentence, "it 
weighs a little heavy.” 

- Finally, after lunch on Friday, the 
decision was made, and the final 
vote taken. The room was quiet. 
Mrs. Chubb said, ’’very quiet/’ 

The jurors sai in silence for a 
moment. But they had made each 
other a promise, she said: "We all 
said, when they ask you. you will 
look him straight in the eye and say, 
'Death.' ” 

iIle Ppa<’e Parley 



Internet as Rumor Mill: 
How Much Can You Trust? 

Among the uses for which the In- 
ternet seems particularly well suired is 
the spreading of rumors — many of 
them baseless, even unerly ridiculous, 
but some with the grain of truth needed 
to provide plausibility. These take on a 
life of their own as they fly straight- 
faced through the electronic ether. 

Terry Chan. 34. an economist in 
Berkeley. California, decided to try 
to slow the rumor mill. He has com- 
piled a list of . Internet rumors, 
checked them out and ranked them on 
a scale from "100 percent scientific 
truth" to ”100 percent falsehood.” 
Here's a sampling, quoted in The 
Seattle Times: 

A penny falling from the height of 
the Empire State Building will imbed 
itself in the pavement. Eelskin wal- 
lets demagnetize bank cards. Bubbles 
in bubble wrap contain toxic gas. A 
shuttle crew did secret experiments 
on how to make love in zero gravity. 
Earlobe repair is a booming business 
for New York physicians because 
thieves rip earrings from women. 

• : A person was crushed to death 
dying to shrink blue jeans by wearing 
them in a tub. Green M&Ms are an 
aphrodisiac. A photo in a Sears cata- 
logue for shorts showed a model's 
male appendage. Some combinations 
of metal tooth fillings can receive 
radio signals. 

Which of the above are true? Only 
the tooth-radio rumor. The model's 
"appendage, " Mr. Chan found, was 
actually a drawstring. 

Short Takes 

Blacksmiths once a steadfast 
symbol of village life, are making a 
comeback. Two decades ago, only 
100 smiths were still at work. Now 
there are about 3,000, many with 
more work than they can handle. Big 
interior-design stores such as Pottery 
Bam and Crate & Barrel sell hand- 
wrought curtain rods and headboards. 
Instead of just shoeing horses, smiths 
are making everything from chan- 
deliers to coffee tables, the Los 
Angeles Times reports. The Artist- 
Blacksmiths Association of North 
America, founded in 1973, has 13.000 
members, most of them hobbyists. 

American bison, nearly eradic- 
ated in the late 1800s, have also made 

Critical Report on Gulf Illness 

Evidence Is Said to Tink Chemical Arms to Troops 9 Complaints 

Jell OiiMfnvnVKniun 

CAKE WALK — New York 
Harbor celebrated Flag Day with 
an 88-foot by 62-foot, 3-ton cake. 

an impressive comeback. Their herds 
once covered vast regions of the coun- 
try. But thousands of hunters — en- 
couraged by a government policy that 
said the best way to "civilize" the 
Indians was to exterminate the bison, 
on which the natives relied for food, 
fuel, clothing and more — killed 
some 50 million Plains bison by 1 900, 
leaving only a few hundred alive. 
Over the last 20 years, however, with 
bison protected, their growth has been 
explosive. An estimated 175,000 now 
thrive in North America. 

It was 60 years ago that the first 
automatic washing machine — one 
that could wash, rinse and extract 
water from clothes — was intro- 
duced. The new machines freed wom- 
en, and some men, to spend more rime 
with families and pursue other activ- 
ities. Yet, after all this time, the laun- 
dry remains a chore that few women 
escape. In 93 percent of American 
families today, the woman tends ro 
the laundry. 

Brian Knowlton 

By Philip Shenon 

New Ywk Times Service 

NEW YORK — A govern- 
ment report has harshly criticized 
the Pentagon and a special White 
House panel over their investi- 
gation of the illnesses reported by 
veterans of the 1991 Gulf War 
and has found that there is “sub- 
stantial evidence” linking nerve 
gas and other chemical weapons 
to the sorts of health problems 
seen among the veterans. 

The report, by the General Ac- 
counting Office, the investigat- 
ive arm of Congress, says that the 
Defense Department should also 
not rule out the possibility that 
Iraqi biological weapons, espe- 
cially aflatoxin, a group of potent 
liver carcinogens, might be re- 
sponsible for some ailments re- 
ported by the estimated 80,000 
Gulf War veterans who have 
sought special medical checkups 
from the government. 

it also criticized the Pentagon 
for trying to discount another po- 
tential risk, a tropical disease 
spread by parasites that produces 
symptoms that might not surface 
for years, and questioned wheth- 
er pesticides had contributed to 
the health problems. 

The report, scheduled for re- 
lease later this month, is certain 
to alarm veterans who have wor- 
ried that they were made ill by 
exposure to Iraqi chemical or bio- 
logical weapons during the war. 

A draft of the report, which is 
being prepared for the Senate 
Armed Services Committee and 

the House National Security 
Committee, was provided to The 
New York Times by an official 
who has been critical of the 
Pentagon's response to the ill- 
nesses of the veterans. 

The Pentagon and the White 
House panel, the Presidential Ad- 
visory Committee on Gulf War 
Veterans' Illnesses, had both 
concluded that Iraqi chemical 
and biological weapons were 
probably not responsible for the 
veterans' health problems, a view 
shared by a number of prominent 
scientists. The Pentagon and the 
White House panel also sugges- 
ted that the physical aftereffects 
of wartime stress were a more 
likely cause of the ailments. 

But those findings were chal- 
lenged in the General Accounting 
Office report, which said, “The 
link between stress and these vet- 
erans’ physical symptoms is not 
well established, and the reported 
prevalence of post-traumatic 
stress disorder among Gulf War 
veterans may be overestimated.’ 1 

It said Pentagon officials and 
the White House panel were also 
wrong to rule out the nerve gas 
sarin and other chemical 
weapons as a cause of the health 
problems, because “there is sub- 
stantia] evidence that such com- 
pounds are associated with 
delayed or long-term health ef- 
fects similar to those experienced 
by Gulf War veterans. * 

Last year, the Pentagon an- 
nounced that more than 20,000 
U.S. troops might have been ex- 
posed to sarin as a result of the 

March 1991 demolition of an Iraqi 
ammunition depot where tons of 
the nerve gas had been stored. 

Spokesmen for the Pentagon 
and the presidential committee 
said that they would not com- 
ment on the General Accounting 
Office report until it was for- 
mally released. 

Representative Christopher 
Shays, a Connecticut Republican 
who has been a leading critic of 
the Pentagon’s handling of the is- 
sue, said he welcomed the report. 

"It supports the idea that we 
should take the Gulf War re- 
search program away from the 
Pentagon and give it to someone 
who really wants to find some 
answers/ 'he said. 

Kwai Chan, director of special 
studies and evaluation for the 
General Accounting Office and 
the principal author of the report, 
said he could not discuss details 
of the findings until the report 
was made public by Congress, 
but he said he was "very con- 
fident” of its conclusions. 

His team included several re- 
searchers with doctorates in sci- 
ence, he said, and they reviewed 
all major studies on the health 
problems associated with Gulf 
War veterans and interviewed re- 
searchers at the Pentagon and 
elsewhere in the government. 

The report also raised the pos- 
sibility that clouds of chemical 
weapons might have reached 
U.S. troops as a result of the 
aerial bombing of Iraqi chemical 
plants and storage depots early in 
the war. 

Away From Politics 

• The army has shut down a special telephone 

line that had received more than 1,300 sexual- 
harassment complaints since November, because 
army officials said anonymous callers were trying 
to use it to settle grudges. (N YT) 

• Three men have btien convicted of stealing $13 
million worth of missile Launchers, Jeeps and 
other goods in the largest known theft of equipment 
from a U.S. military base. Two other men were 
acquitted, in the trial, held in Madison, Wisconsin. 

( AP ) 

• A judge in SL Joseph, Michigan, resigned just 
hours after a newspaper obtained records showing 
he had dialed phone sex services 124 times from his 

courthouse phone. Hugh Black, a Berrien County 
District Court judge since 1973, said in a statement 
that he was quitting “due to continuing difficulties 
with my hearing." (AP} 

• A laid-off factory worker returned with a gun 
and shot a former co-worker to death, wounded 
his former boss and killed himself. The gunman. 
Soon Byung Park, 36, pulled a pistol and began 
shooting during an argument Friday morning at the 
Yaanimax Inc.-U.S. Embroidery Co. plant in Santa 
Fe Springs, California, die police said. (A P ) 

• Texas authorities are trying to determine if a 

rare, fatal brain disorder linked to "mad cow" 
disease is claiming an unusually high number of 
victims in the state’s northeast. Five cases of 
Creutzfeldt-Jakob disease have been identified in 
the region since April last year. • (AFP) 

Times Ends a Long Broadway Run 

By Lawrence Van Gelder mM™ copies of the Sunday 

Nrvi- York Times Sen-Ice 

NEW YORK — The cur- paper handlers, machinists, 
tain has' come down on ihe electricians, mailers, drivers 
longest-running production and managers were involved 
on Broadway. in the final night of what had 

After 146 years, 93 in or been the largest manufactur- 
near Times Square, The New ing operation in Manhattan. 
York Times was printed in Beginning Sunday, The 
Manhattan, for the last time Times, with a weekday cir- 
Saturdav ninhL culation of 1.1 .million, was 

on copies of the Sunday should remind everyone that note of the inclination to sor- 
r. economic development in row over the end of produc- 

all, some 80 pressmen. New York City includes five tion on 43d Street. "But," he 

boroughs, not just one. 

The city gave The Times 
$21.5 milli on in tax credits, 
grants and purchase options 
for the new plant The tax 

wrote, “our history is one of 
constant renewal, and it 
teaches us that the passing of 
one tradition also marks the 
birth of a new and exciting 

York Times was printed in 
Manhattan, for the last time 

Saturday nigbL 
In the culminai 

increase press capacity, auu 
new sections and offer later 
news and scores for readers in 

In the culmination of plan- printed for New York met- 

ning begun in the 1980s to ropolitan area readers at its 
capacity, add new $350 million, five-press 

teens, and at a $450 mil- 

the metropolitan region, the lion, six-press plant in Edi- “There are tough guys 
pressroom under 43d Street son. New Jersey, which has here, and they’re crying.” 
between Seventh and Eighth been operating since 1993. Raymond Kelly. 57, 

breaks were intended to keep era.” 
thejobs in New York City. The Times, founded in 
The end of an era on 43d 1851, had been printed since 
Street was tinged with sad- 1904 in Times Square and 
ness for many employees. -since 1913 at 229 West 43d 
“The emotional portion of Street. 

it is very difficult," said Tom 

Watber, the plant manager re- ( / _ 

sponsible for production, j 

“There are tough guys in , ■ 

Avenues rumbled its last. 

The headquarters of The 

At the end. where nine- Times's news, editorial and 
huge Goss presses whirred as business offices will remain 

recently as six months ago, 
there roared only a single 

ZOO. STORY — Newt Gingrich strokes a party 
Rafted at his 54th birthday party in Atlanta’s zoo. 

at 229 West 43d St. 

Commenting on the trans- 
fer of production, Charles 
Millard, the president of die 

half-century-old press tended fer of production, Charles 
by a crew of a baker’s dozen, Millard, the president of die 
turning out about 5 percent of city's Economic Deve loa- 
the news sections of the 1.64 ment Corp., said: "This 

Raymond Kelly. 57, a 
pressman for 40 years and the 
assistant general foreman of 
all pressroom operations for 
The Times, echoed Mr. Wal- 
ber. “It’s my adult lifetime,” 
he said. 

In aformal statement to the 
staff Friday, the publisher. 
Arthur Sulzberger Jr., took 

For investment information 


every Saturday in the IHT. 





For a hand-delivered 
subscription on the 
dav of publication, 
call 00 33 141-13 9361 


House Panel Passes Tax- Cut Bill 

WASHINGTON — The House Ways and Means 
Committee has approved a Republican tax-cutting bill 
despite unanimous Democratic opposition, selling Con- 
gress on a collision course with the Clinton admin- 
istration over how to divide the tax reductions agreed on 
in their balanced-budget plan. 

While administration officials and some congressional 
Democrats held out hope that the Senate would adopt a 
plan more acceptable to the president when it takes up its 
version of the legislation this week, the bill being pre- 
pared by Senate tax writers closely hacks the House of 
Representatives' bill in many ways, increasing the odds 
that President Bill Clinton will veto the final version. 

The failure of the House committee's chairman. Rep- 
resentative Bill Archer of Texas, to secure any Demo- 
cratic support for his plan shows that the partisan 
wrangling that had dominated debates over taxes and 
spending for two years has returned. 

Mr. Archer's plan, approved by a 22-to-16 vote, would 
reduce tax bills for investors and many families, provide 
some tax breaks for college expenses, reduce federal 
inheritance taxes and expand Individual Retirement Ac- 
counts. The measure calls for S 1 35 billion in tax cuts over 
five years, offset in part by nearly S5Q billion in new’ 
revenues, generated largely by expanding existing laxes 
on airline rickets and closing loopholes. 

But the White House and Democrats on the committee 

^ ' : 

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LAST TERM — Senator Dale Bumpers, with his 
wife. Betty, announcing in Little Rock, Arkansas, 
that he will retire when his fourth term ends. 

attacked the plan as favoring the rich and as violating the 
budget deal by scaling back Mr. Clinton's proposed 
college tax breaks. 

White House officials have avoided explicit veto 
threats, but Mr. Clinton repeated his criticism of Mr. 
Archer's bill, saying that among other problems, it 
"would penalize the working poor and especially work- 
ing poor mothers.” Michael McCurry. the White House 
spokesman, said Friday that Mr. Archer’s legislation “is 
not the bill that will be signed into law." (NYT) 

Gingrich Can Afford Penalty 

WASHINGTON — Congress has released the finan- 
cial disclosure statements of its members, drawing new 
attention to the House speaker. Newt Gingrich, whose 
book royalties more than doubled his income last year. 

In the last two decades, members of Congress have 
been compelled to file broad financial-disclosure state- 
ments to show that they do not have financial holdings 
that pose a conflict of interest with their jobs. 

The financial-disclosure statement filed by Mr. Gin- 
grich showed that he probably had the wherewithal to 
abide by a major provision of the ethics judgment against 
him this year, that he use his own money to pay at least 
half of a $300,000 penalty for violating House rules. 

Mr. Gingrich's earned income in 1996 was 5356,609. 
His congressional salary was $171,500. while 5185.109 
came from other sources, largely from his best-selling 
book, "To Renew America.” (NYT) 

Move to Close U.S . Bases Fails 

WASHINGTON — After a narrow defeat by the 
Senate Armed Services Committee in a closed-door vote, 
a group of senators pledged to push President Clinton's 
plan for more military base closings. 

Efforts to get the committee to authorize rwo further 
rounds of base closings in 1 999 and 2001 failed on a 9-to- 
9 vote, said Senator Carl Levin of Michigan, the com- 
mittee's ranking Democrat. 

The defense bill, approved last week by the committee, 
now goes to the Senate floor. The House already has 
completed action on its own version of the bill which sets 
spending limits and policy for the Pentagon. 

The Pentagon has closed or is preparing to close 97 
major domestic bases by 200 1 . A few weeks" ago, it said it 
would ask Congress to authorize two more rounds of base 
closings, beginning in 1999. The rationale is that posr- 
Cold War troop levels have shrunk, so fewer bases are 
needed. (AP) 


Jannie Coverdale, who lost two grandsons in the Okla- 
homa City bombing, commenting after Timothy McVeigh 
was sentenced to death for his role in the attack: "This is 
not a time for celebration. A man’s life is being taken from 
him. It’s something that we wanted, and it's not done out 
of revenge. It’s because we felt it was necessary.” (AP) 


A C C A R A T 

imioKurs n\m xewspvpkh 


CAU, : 01 477064 30 




The Grapes of 

The states best varieties 
and where they grow. 



Americas most popular, 
white varietal. Styles can 
range from big. buttery and oaky to more 
austere, higher-acid versions, best appel- 
lations: Cumeros. Russian River Valley, 
Monterey. Santa Barbatv. Napa. Sonoma, 

S,u yioxon Blanc 

Also known as 

Fum6 Blanc. Bright 

high-acid wine, with a pleasing herbal tinge. 
best appellations: Sonoma, Napa, 
Montcre): Lake. Santa Barbara, Livermore. 

The great German variety is 
sometimes called "Johannes- 
burg Riesling” in California. At its best, h 
can yield fruity, floral wines. There are also 
many successful sweet “late harvest” ver- 
sions being produced, best appellations: 
Monterey. Nupa, Santa Barbara, Russian 
River Valiev, Mendocino. 

Cr \vi icz i rwiini k 

A spicy, perfumed 
variety that has had 
success in limited plantings, best appel- 
lations: Mendocino (Anderson Valle}'). 
Sonoma. Monterev. 


This white variety from the 
northern Rhone Valley is 
emerging as a popular Chardonnay altern- 
ative. best appellations: Napa. Sonoma, 
Santa Barbara. Bi we 

A high-volume grape: 
simple, fresh and 
charming. A few producers make serious, 
quality versions, best appellations: 
Clarksburg. Napa. Mendocino. Sonoma. 

Often blended with Sauvig- 
non Blanc for dry Bondeaux- 
style blends. Some superb sweet versions as 
well. BEST appellations: Monterey. Napa. 
Stwoniu. Livemon. 


Cabernets a la k;non 

The red grape 
that established 
California as a premier wine region still 
accounts for many of the most prized (and 
costly) bottlings. Dense, deep wines with 
flavors of plum, smoke, leather, mint, and 
spicc. best appellations: Napa. Sonoma 
{Alexander Valle}-. Knights Valley. Sonoma 
Vuilev). Santa Cnc. Livermore. 

mmmm A rising star, this soft luscious 
■■■■■III varietal has emerged as a low- 
tannin Cabernet alternative. Best appel- 
lations: Contents. Napa. Sonoma t Alex- 
ander Vul/eh Sonoma Vullevi. 

Pi not No m 

A difficult-to-produce grape 
that can yield complex wines 
loaded with cherry/beny fruit best appel- 
lations: Cumenxt. Russian Rix er Valley, 
Simla Biirbatv. Mendocino. Monterew 


Of unknown origins. Zin- 
fandel offers peppery, spicy 
flavors with lots of blackberry fruit. Also 
made in a blush version called White Zin- 
fandel. best .appellations: Napa, Sonoma 
(Dty Creek Valley. Sonoma Valley). Men- 
docino. Russian River Valley. Amador. 

■■■■ Rich, red Rhone variety that yields 
■■■iil dense wines with ripe flavors of 
blackberries, tar and spice, best .appella- 
tions: .Sr mouia. Santa Barbara. 

The primary grape in Chi- 
min is a rising star in Cali- 
fornia. Spicy, medium-bodied, with ripe, ap- 
pealing flavors, best appellation: Napa. 

A lesser variety than 
Syrah. Yields dark, 
purplish w ines that are full-bodied, tannic, 
course and dense, best appellations: 
Vi if hi. Siinuinu. Liveivtore. 


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California IWne Industry on |h« Web . 

Petite Shiah 

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Ti p EPHI At i5l»i 455-77*0 Fax (510i 447-0780 

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Passing the Taste Test 
Quality Drives Export Boom 

^ Exports of wines 

* e United 

SHE] 3 States are boom- 

r- ing. Indeed, de- 

exceeds produc- 
non. American 
wines are expor- 
ted to 164 coun- 
tries. In 1996, 
sales jumped by 

35 percent, to S327 million, and rose 22 percent in 
volume, to 47.5 million gallons. These impressive 
figures reveal die growing worldwide enthusiasm 
for U.S. wines. California produces 90 percent of 
wines in the United States and exports nearly 1 0 
percent of its production. 

“The future for Californian wine exports is very 
bright,” says Larry Maguire, managing director of 
Far Niente. This small Napa Valley estate winery 
produces about 40,000 cases of top-quality Cab- 
inet Sauvignon and Chardonnay a year and ex- 
ports around 7 percent to 10 percent of its pro- 
duction. Mr. Maguire adds: “Californian wines 
had huge problems 20 years ago. They were seen 
as die inexpensive alternative rather than a taste 
alternative. Now people have come to realize that 
Californian Cabernets have a taste of their own 
that makes them distinctive and that Californian 
Chardonnays are wonderful and should be eval- 
uated for what they are.” 

Britain remained the top export market for U.S. 
wine, accounting for a quarter of all exports. In 
1996. sales to Britain brought in 58 1 .6 million, up 

36 percent over 1995. Over half of the wines 
exported from die United States in 1996 were sold 
in Continental Europe. “The consistent presence 
of California vintners at major trade shows and 
tastings is having a positive cumulative effect on 
U.S. wine exports to Europe.” says Paul Molle- 
man, the European marketing manager of the San 
Francisco-based Wine Institute. “The availability 
of a wider selection of wines at different price 
ranges has also continued the momentum.” 

Canada was die second largest export market 
last year. Sales rose 35 percent, to $72.4 million, 
accounting for 22 percent of the total value of U.S. 
wine exports. 

“The reasons for the strong California trend are 
a higher emphasis on exports by California 
vintners, along with a growing recognition by 
consumers of the quality paxluced in the Golden 
Stete. and the significant support provided by 
Canada's restaurant trade.” says Rick Slomka. die 
Wine Institute’s trade representative in Canada. 

Japan remained the third largest overseas mar- 
ker in 1996. Though dollar value was down 3 
percent, volume rose I percent Other Pacific Rim 
markets experienced significant increases last 

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tarings 'IB U MC , 

year, including Hong Kong. Taiwan, Thailand, 
South Korea and Singapore. China surged by 350 
percent, spending $1.1 million on U.S. wine. 

Joseph Rollo, director of the Wine Institute's 
international department, says, “The booming 
Pacific Rim economy has created more discre- 
tionary income for Asian consumers, and the 
positive health news on moderate drinking is 
expanding die interest in wine." 

Wente International in Livermore exports more 
than 50 percent of its production to 122 countries. 
John Schwartz, vice president of international 
operations, says. “In Southeast Asia, wine con- 
sumption has now eclipsed Cognac. Ever since the 
royal physician prescribed a daily glass of red 
wine for die king ofThailand's heart condition, we 
cannot get enough Cabernet into the country.” 

Wente is now the largest exporter of California 
wines to France. “We have been selling in France 
for six years,” Mr. Schwartz says, “and we are 
making great progress because the French no 
longer exclusively drink French wine. I think the 
future of Californian wines in Europe shows noth 
ing but upward growth.” 

Wente affiliates Concannon Vineyards and 
Murrieta’s Well Winery also recognize the im- 
portance of exports for die future of the U.S. wine 
industry. At the Schug Cameras Estate Winery in 
the Sonoma Valley, wmemaster Walter Schugof 
says, “We export about 30 percent of our 1 6,000- 
case production, which is high for a Californian 
winery. We are particularly successful in Ger- 
many, but we regard Asia as a very important up- 
and-coming market.” 

St. Supery only opened its doors in- 1989 but is 
already producing 100.000 cases a year and ex- 
pects to produce 180,000 annually by 2005. 
Around 10 percent of production is exported. 
Export Manager Lesley Keflfer says, “Exports are 
very important to our company. We feel we should 
have some international focus. We see a steady 
growth in exports right up until the time we reach 
our goal production level.” 

Dry Creek Vineyand has gone from producing 
1 .200 cases when it was founded in 1972 to 120,000 
in 1996. It exports around 10 percent of its pro- 
duction. The winery specializes in Fume Blanc but 
also produces award-winning red Reserve wines. 
“We were one of the very first Californian wineries 
to send our products overseas,” says Vice President 
Kim Wallace. “We shipped our first exports over- 
seas to England in 1977 and have not looked back. 
The biggest problem we have right now is that we 
don't have enough wine to open up new markets. We 
are just trying to supply wine to existing agents.” 

The Murphy-Goode Estate Winery is enthu- 
siastic about selling abroad. “We are pursuing 
exports because it is a growing market for us,” 
says sales coordinator Christine Griffith. Kautz 

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in California’s 

Gold Rush coun 

only five years but 
already produces around 
150.000 cases annually, over 
30 percent of which is exported. 

“We started exporting one year 
after we were established,” says Ex 
port Director Joan Kautz. “We tec 
ognized the potential for export early 
and have committed much of our energies to 
expanding our export markets.” Trefethen 
Vineyards produces 125.000 cases a year and 
exports about 7 percent of its production. Owner 
Janet Trefethen says, “Exports are critical. We 
want to be recognized as one of the fine wine 
producers of the world, and we cannot do that ifwe 
keep all our wines in our own backyard.” She 
adds: “In terms of quality, these days Californian 
wines are among the best We can proudly go and 
taste with anyone, anywhere.” 

Ian D. Markham-Smfth 


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From Missionary Grapes to World-Class Vintages 

smoot:- as stix IS 89 

l These are heady times 
1 lifT* ^ or California wine 
jj-jijL industry. Throughout 
America and the rest of 
the world, wines made 
* n ^°^ en Sfc» te 
have developed a rcpu- 
tation feat rivals the 
great wines of Europe. 
While favorable climates, ideal soil profiles and 
cutting-edge viricultural practices have contrib- 
uted to this success, what it really comes down to 
is freedom. Talented young vintners have had the 
liberty to experiment with different grape vari- 
eties. winemaking styles and growing areas. In 
this way, through trial and error, they have forged 
an industry of remarkable distinction. 

Franciscan missionaries planted the first 
vinifera (European) grapes in California in the 
late 1 8th century to make sacramental wines, but 
most of the plantings were subsequently wiped 
out by phylloxera, an aphid that feeds on grape 
vine roots. Gold Rush frenzy swept Northern 
California in 1849 and. in response to the en- 
suing population boom, pioneer vintners planted 
vines in Napa and Sonoma. Later, regions ran- 


ging from Los Angeles county in the south to 
Mendocino in the north were developed The 
German Wente family established the Livermore 
Valley as a premium wine-producing region. The 
Concannon family and, more recently, Mur- 
rieta’s Well, have followed their lead 

Two events — one natural, the other political 
— would conspire to bring this first Golden Age 
to an end In 1880. a wave of phylloxera ruined 
entire vineyards. Then, in 1919. estates lucky 
enough to survive phylloxera had to contend 
with Prohibition. Many winemakers shut down; 
others turned their vineyards into fruit and nut 
orchards. When Prohibition ended 1 3 years later, 
much of the wine industry's infrastructure lay in 
disrepair. More significantly, American tastes 
had turned to spirits like bourbon and scotch and 
away from wine. 

In the 1960s and early ’70s, a group of 
vintners began to rediscover premium wine. The 
watershed event was the Paris Tasting of 1 976, in 
which a pair of California wines defeated French 
Burgundies and Bordeaux in a blind tasting 
attended by the top wine experts in France. By 
die 1980s, investment was again pouring into 
California’s wine country. Many of the new 

arrivals restored 19th-century properties. Gil 
Nickel renovated a classic winery in Napa fbrhis 
Far Niente estate. Hamden McIntyre, who built 
the original Far Niente winery, also constructed 
die vintage wooden winery that has since been 
restored by die Trefethen family. 

Vines were planted throughout die state, and 
several important appellations emerged. Caraer- 
os, at the southern edge of Napa and Sonoma, has 
a coo) climate suitable for the production of 
Chardonnay, Pinot Noirand sparkling wine. This 
is where Walter Schug established ins premium 
winery. The Dry Creek Valley in Sonoma 
showed promise with deep, fruity Zinfandel and 
lush Cabernet Sauvignon. It remains one of the 
most consistently excellent red wine districts in 
the state. David Stare’s Dry Creek Vineyards was 
the first premium winery established there after 
Prohibition. The Russian River Valley, Santa 
Cruz, Santa Barbara, Mendocino and Monterey 
all became home to premium wineries. Even the 
foothills of the Sierra Nevada Mountains 
emerged with a few quality producers, including 
the Kautz Winery. Catiforinia vintners have dis- 
covered the critical importance- of terroir, the 
unique quality a region imparts to its wines. 

California wine country is a major tourist 
attraction. Route 29, which runs through the 
central Napa Valley, attracts more than 3 million 
visitors every year. One popular stop is Saint 
Supery, an estate winery owned by the French 
Skalli family, which boasts a fine visitor center. 

Just as the American wine industry was gath- 
ering steam, a neo-Prohibitionist movement 
began to take shape, seeking to impose a variety 
of regulations and mandatory warning labels. 
But just when the outlook seemed bleakest, 
America’s most popular television news show, 
“60 Minutes.” reported that moderate wine con- 
sumption has health benefits. 

Thanks to this news and the lobbying efforts 
of the Wine Institute, the American wine in- 
dustty has entered die most prosperous period in 
its history. American consumers deserve a lot of 
credit for foe resurgence of California wine- 
making. They are better educated about foe 
subtleties of fine wine and understand and ap- 
preciate foe different wine varieties produced in 
the state. Americans are consuming more wine 
than ever before because California wines are 
better than ever before. Indeed, they are among 
foe best in foe world. Anthonv Dias Blue 


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Somalia Photos Shake Italy 

Evidence of Army Abuses Stirs Calls for Inquiry 




* Wfc 


By John Tagiiabue 

xVrw~ York Twit's Service 

ROME — The publication of 
photos said to depict Italian soldiers 
abusing unarmed civilians during a 
mission to Somalia in 1993 has led 
to a wave of soul-searching in this 
nation accustomed to a gentler im- 
age of its postwar armed forces. 
^The photos were published over 
the last week by the news magazine 
panorama and were accompanied 
by interviews with the former sol- 
diers who took the photographs de- 
railing acts of brutality to civilians. 

in one photo, an. Italian officer 
appears to be applying electrodes to 
. rhe wrist of a Somali man who lies 
Snaked on the ground. A series of 
pictures show soldiers who appear 
lo be sexually abusing a young 
woman with a military flare 
smeared with jam. 

Thursday. Defense Minister Ben- 
j amino Andreatta pledged an im- 
mediate investigation, saying that 
the “honor of the armed forces is at 

Although soldiers of other na- 
tions, including Canada and Bel- 
gium, have been accused of brutality 
during the mission in Somalia, the 
harshness of these published images 
shakes one of the widely held as- 
sumptions of Italians, namely that 

their armed forces in the post-World 
War n era are of a more easygoing 
son than those of other nations. Itali- 
ans cling to a popular notion of their 
military as a bastion of pageantry 
embodied by columns ol soldiers 
with feathers in their caps marching 
to martial music. 

The photographs also have raised 
the issue of responsibility for atroc- 
ities committed in wartime, one the 
Italian justice system has had dif- 
ficulty resolving. 

Troops of Italy 's crack Follow. 
or Lightning, division went into 
Somalia in late 1993 together with 
soldiers from other nations in a mis- 
sion led by the United Stales to 
safeguard the delivery of; food to 
starving civilians. 

While the operation helped the 
hungry on the Horn of Africa, ef- 
forts to restore civilian order 
foundered, and in 1995 the last 
troops, by then under United Na- 
tions supervision, were withdrawn. 

Mr. Andreatta. the defense min- 
ister. has himself come under attack 
by fellow cabinet ministers for re- 
marks to a television reporter in 
which he appeared to belittle the 
seriousness of the actions attributed 
to the soldiers as “military student 

Anna Finocchiaro, rhe minister 
for equal opportunity, criticized Mr. 

Andreatta, saying the deeds aurib- 
uted to the soldiers were a ‘very 
serious felony, a crime against hu- 
man rights." 

Italian officials identified the of- 
ficer who appears to be fixing elec- 
trodes to a Somali as Valerio Ercole, 
who now works in a military hos- 
pital in Livorno, in central Italy. He 
and four other officers have been 
questioned by military prosecutors, 
they said. 

The charges strike at the very 
heart of a discussion about Italy's 
military role abroad. 

Thousands of Italian soldiers ore 
now stationed in Albania, leading a 
multinational force that is securing 
the delivery of food and other aid 
and seeking ro maintain a fragile 
peace before national elections 
scheduled for later this month. 

Colonel Marco Bertolini, the 
commander of the Folgore Division, 
defended the behavior of the Italian 
troops in Somalia. saying. “Somalia 
was not our Vietnam.” 

The commander, who served in 
Somalia in 1993, said the crimes 
imputed to the division's men. “if 
they happened, were sporadic 
events and isolated crimes, not the 

But Saro Petiinato. a senator of 
the Green Party responsible for ju- 
dicial matters, proposed that Mr. 

iVl.l V.rtiMiirh.- V .....Ini l"i. 

General Carmine Fiore, left, shaking hands with General Bruno 
Loi in Somalia in 1993. Both officers resigned over the weekend. 

Andreatta take the inquiry out of the 
hands of military prosecutors and 
give it to civilian magistrates. 

Last year. Italians were stunned 
when a military court in Rome freed 
a former German soldier. Erich 
Priebke. who is accused of com- 
plicity in one of the worst atrocities 
committed in Italy during World 
War II. Prosecutors say Mr. Priebke 
was a principal participant in the 
execution in 1944 of 335 Italian 
civilians at the Anleatinc Caves out- 
side Rome. 

Italy's highest court later nulli- 
fied the verdict of the military court, 
which had ruled that the statute of 
limitations had expired in the Prieb- 
ke case, and ordered a new trial. 

Some here have cited the case as 
an argument against those who 
sought to minimize the significance 
of what occurred in Somalia. 

“Priebke, too. was doing his 
duty," said Stefano Cingoluni. a 
commentator in the daily Corriere 
della Sera. “He was only following 

Major Issues Still Divide Allies as Decision on NATO Nears 

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7 -~ - • 

.... „ **:!»■■ 

~ By Craig R. Whitney 

Neu York Time* Son ice 

ANKARA — Russian objections 
lo enlarging NATO may be out of 
the way. but the allies remain far 
apart. over issues they will have to 
resolve before they can go ahead 
next month with plans to extend the 
first formal invitations to prospect- 
. , ive members. 

, ^ i The United States is at odds with 

France, Italy, Turkey and half a 
dozen other allies in its insistence 
j that only the Czech Republic, Hun- 
I gary and Poland can be admitted in 
The first wave. 

' . 1 France is srill holding the reor- 

- — * Cranizalion of NATO hostage to its 

- ^ 10 replace a U.S. admiral with 
w i European officer in the alliance's 

ley southern military post, the 
Sflulhem Command in Naples, ai- 
■ ’4” * led officials at NATO headquarters 
- n Brussels said. Last week. Defense 

Secretary William Cohen rebuffed 
the French again. 

And in yet another hitch, here in 
Turkey, a NATO member since 
1952. officials say that their country 
will block any decision 1 on enlarge- 
ment unless it gets some encour- 
agement in its decadeslong quest to 
join the European Union. 

President Bill Clinton and other 
NATO leaders want to proclaim the 
alliance reorganized for the post- 
Cold War era and extend invitations 
to the first Warsaw Pact countries to 
join it at a summit meeting in Mad- 
rid on July 8-9. 

But NATO decisions require a 
consensus of all 1 6 members. Some, 
including Turkey, want Romania in- 
cluded in the fust wave of expan- 

And Turkey, miffed at recent sug- 
gestions from some European 
Christian Democratic politicians 
and others that Muslim Turks are 

not real Europeans, is threatening to 
hold the North Atlantic Treaty Or- 
ganization hostage to its long-stand- 
ing desire to get into the EU. 

Turkey's shaky coalition govern- 
ment and its powerful military es- 
tablishment. at odds over the di- 
rection the country should take on 
many other things, appear to agree 
on the enlargement issue. 

‘ * If Turkey has the feeli ng that we 
are not being discriminated against 
in the European Union, then we will 
be in a position to participate in the 
NATO enlargement process," said 
Onur Oymen, a senior Foreign Min- 
istry official. 

He added that Turkey was also 
demanding full membership in the 
Western European Union, a Euro- 
pean defense group that coordinates 
with NATO. 

General Cevik Bir. the powerful 
deputy chief of staff of the Turkish 
armed forces, put the country’s po- 

sition more bluntly, saying. “We 
wou Id like to use NATO as a tool for 
our integration into the European 
Union and the Western European 

General Bir expressed concern 
over what he called the “anti-sec- 
uiar activities” of the coalition gov- 
ernment of Prime Minister Necmet- 
tin Erbakan, whose Islamist 
leanings have also alarmed some 
EU leaders. But Defense Minister 
Turhan Tayan brushed aside Euro- 
pean objections. 

“Our European friends are not 
being very objective when evalu- 
ating our desires," he said. “It is not 
possible to explain T urkey not being 
accepted as a European state.” 

Turkey, with 62 million people, 
has been trying since 1963 to join 
what is now called the European 
Union. But some Western diplomats 
argue that its high inflation rate, 
more than 70 percent this year, high 

unemployment and a social and mil- 
itary conflict with Kurdish separat- 
ists that has led to accusations of 
widespread human rights violations 
all put Turkey far behind Poland, the 
Czech Republic. Hungary and other 
Central European countries on the 
list of EU applicants. 

“No country can become a Euro- 
pean Union member with such se- 
rious internal problems with a 
minority or a region that democratic 
structures or the security of the coun- 
try are placed in peril," the German 
ambassador in Ankara. Hans- 
Joachim Vergau. said recently. 

Turkish officials say that unless a 
report by the EU Executive Com- 
mission on prospective members 
gives Turkey reason to hope for 
eventual membership on the same 
terms and criteria as applicants from 
Central Europe, there will be trouble 
at next month’s NATO summit 
meeting in Madrid. 

Italian Referendum in Doubt 

ROME — A referendum in Italy on seven issues a*, 
diverse as hunting and privatization was in douhl Sunday 
amid indications That a majority of voters could siav away 
from pi »l ling stations. 

For a referendum to be valid here, more than 50 percent 
of the 4VJ million eligible voters have to take pan. Rut only 
13.2 percent had cast their ballots hy 5 P.M. on Sunday. 
10 hours alter polling stations had opened, according to 
official figures. 

The low turnout was attributed partly to the media, 
which was indifferent to the referendum. Alter three 
general elections in five years, the Italians also are 
experiencing voter fatigue.’ In the sweltering weather, 
mans preferred to go to the beach. iReuu r\ t 

U.K. Focuses on Ulster Parades 

BELFAST — Britain vowed Sunday to slop up el Jons 
to find a peaceful solution to the conflict over parade* 
between Northern Ireland'* rival Protestants and Cath- 

Northern Ireland Secretary Mo Muwlam. anxious lo 
avert a repeal of the turmoil that gripped the province last 
year, announced that she would hold talks with pro- 
British Protestant marching groups and Catholics who 
object to the marches. 

'■‘The government is determined to do all we can to 
avoid a repeat of last year's appalling events, which the 
people of Non hem Ireland have nude absolutely clear 
they don’t want to see.” she said. Last year the marches 
prompted the worst street violence in the province in 
decades. t Renters t 

East Germans Clash W ith Turks 

BERLIN — East German youths shouting “Heil 
Hiller” clashed with Turkish shopkeepers in Rostock and 
other extremist rightists severely beat a Togolese asylum- 
seeker. the police said Sunday. 

They said a third group attacked a group of campers in 
the eastern town of Liepgarten. leaving a 16-vear-old 
youth with head injuries. 

A police spokesman in Rostock north of Berlin said 
about 10 youths between the ages of 16 and 20 tried to 
attack the Turkish shopkeepers on Saturday. Bui the 
Turks fought them off with metal bars, leaving two of the 
assailants seriously injured. t Reuters ) 

Tory Says Defeat Whs Inevitable 

LONDON — The former British finance minister. 
Kenneth Clarke, said Sunday that no one could have led 
his Conservative Party to victory in the May I election 
that swept the Labour Party into power and ousted Prime 
Minister John Major. 

Laying out his position for Tuesday's second round 
ballot for the leadership of what is now Britain's main 
opposition party. Mr. Clarke said defeat had been in- 

Before the election, “the big issue was. was the Con- 
servative Party really still capable of being the natural 
governing party of this country.” he said in an interview 
on BBC television. “It would be possible to look back 
and say. Look, probably the party wasn't leadabie by 
anybody in its then state, and it probably wasn't elect - 

Labour's landslide victory left just 164 Conservative 
members of Parliament — less than half the number the 
party had in the previous election. ( Reuters I 

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Hong Kong Panel Backs Political Limits 

By Keith B. Richburg 

HfoAxijjidH Pint Scnicc 

HONG KONG — Beijing’s shad- 
ow legislature for Hong Kong has 
approved a package of tough new 
restrictions tor the British colony, 
responding to demands of China's 
Conimunist leadership that this cap- 
italist enclave not be turned into a 
base for subversion after it comes 
under Chinese control July I. 

Tile “provisional legislature,” as 
die hand-picked panel is called, 
voted to give the Hong Kong police 
broad new powers to ban even 
peaceful demonstrations in protect- 
ing China's “national security." 
Another change wiU initiate a re- 
quirement that groups wishing to 
hold protest marches or rallies get 
approval from the police. 

[In London, the Foreign Office 
condemned the provisional legisla- 
ture's new laws Sunday as ‘‘both 
unjustified and unnecessary," 
Agence France- Pres se reported. A 
Foreign Office spokesman said the 
moves had “aroused concern in 
Hong Kong and internationally.”] 

The shadow legislature’s action 
drew a condemnation from Martin 
Lee, a member of Hong Kong's cur- 
rent legislature, which the Chinese 
plan to disband, chairman of the 

Democratic Party and a well-known 
campaigner for democracy. 

"This is a clear sign of things to 
come,'’ Mr. Lee said. “These 
changes to our laws represent a step 
backward for freedom and will re- 
vive colonial restrictions on the ex- 
ercise of basic rights." 

The 60- member appointed leg- 
islature also voted to outlaw foreign 
donations to political parties — a 
move aimed directly at weakening 
the popular Democratic Party, 
which receives aid from overseas 
human-rights organizations and oth- 
ers. The panel also voted to impose 
penalties of $800 and three years in 
prison for anyone who bums or de- 
faces a Chinese flag after July 1. 

The provisional body has been 
meeting outside Hong Kong, in the 
Chinese border city of Shenzhen. 
All of the new laws will take effect 
immediately after Hong Kong re- 
verts to Chinese sovereignty. 

The new rules set off dispute here 
and abroad when the man who will 
be China's chief executive for Hong 
Kong. Tung Chee-hwa, proposed 
them in April. But Saturday, the 
entire package of proposals passed 
on jusr a voice vote and after only 
two hours of debate, as members of 
the pro-China panel expressed 
agreement with Mr. Tung's mes- 

sage that Hoag Kong's freedoms 
must be controlled or the territory 
risked a breakdown of public order 
after China officially takes charge. 

Only two members of the ap- 
pointed panel, both formerly de- 
mocracy legislators who joined the 
shadow chamber, tried to water 
down some of the new regulations. 

One member, Dominic Chan, 
proposed that police use national- 
security grounds to ban protests 
only if the demonstrators were in- 
citing foreign military intervention 
against China. He likened the new 
restrictions to "holding a knife to 
the throat of freedom and democ- 

But Michael Suen, Mr. Tang’s 
legal adviser, disagreed, saying na- 
tional security could be threatened 
without violence. 

Defenders of the new rules say 
the restrictions on public protests 
and on political parties are no more 
severe than those wielded by British 
colonial authorities for most of the 
150 years of imperial rule in Hong 
Kong. But many of the archaic co- 
lonial laws were repealed over the 
lost seven years — after Britain 
knew it would be turning Hong 
Kong over to China, and after the 
1989 army massacre of students 
demonstrating in Beijing’s Tianan- 

men Square induced British author-, 
ities to introduce a last-minute mea- 
sure of democracy in the colony. 

Meanwhile, a plan by Prime Min- 
ister Tony Blair of Britain and the 
U.S. secretary , of stale. Madeleine 
Albright, to boycott the swearing-in 
ceremony for the appointed legis- 
lature appeared to be gathering little 
international support 

Mr. Blair and Mrs. Albright travel 
to Hong Kong at the end of the 
month for the official transfer ce- 
remonies. to be held at a waterfront 
annex to the city’s international con- 
vention center. 

But both have said they will skip a 
separate inaugural event at which 
Mr. Tung, the appointed legislature 
and new members of the supreme 
court will take their oaths of office. 
Mr. Blair and Mrs. Albright were 
concerned that attending the cere- 
mony might lend legitimacy to the 
appointed legislature. 

Officials from Australia. New 
Zealand and Japan, among others, 
have said they will attend, so as not 
to snub China. 

In Tokyo, Prime Minister Ryu- 
taro Hashimoto said he would send 
the Japanese foreign minister to the 
ceremony even though he knew it is 

"I think we must go." he said. 

Guerrilla Pursuit 
Of Pol Pot Reported 

Mmi IbrJAfafcta, . 

Mr. Tung attending the inaugu- 
ration of the building where 
Hong Kong's transfer will occur. 

Foreign Minister Alexander 
Downer of Australia said he would 
attend because Canberra had 
already registered its objections to 
the appointed body. 

America call i- 8 oo -4 NORTEL. Europe. Africa/Middle East fax *44 162a 432496. Asia/Pacific fax -852 2585 2196. 
Caribbean/Latin America fax -/ 954 851 8818. Internet 

By Seth'Mydans 

New Y-vkTimes Sen'ir* 

PHNOM PENH — Pol Pot, 
a - man responsible for the 
deaths of more than a million 
of his countrymen,, was re- 
ported over the weekend to be 
on die run in a remote jungle, 
pursued by guerrilla lighters 
he once commanded. 

The former dictator is being 
protected by no more than 300 
armed men, a Cambodian gov- 
ernment official said, after or- 
dering the killing of one of his 
chief Lieutenants in what ap- 
peared to be a final, fatal split 
in the inner circle of his move- 
ment, the Khmer Rouge. 

. The government official. 
General Nhiek Bun Chhay, 
spoke at a news conference 
Saturday at which he dis- 
played large color photo- 
graphs of the bloody corpse of 
me roan Mr. Pol Pot is said to 
have had killed last week, his 
former defense minister. Son 
Sen. Mr. Pol Pot, 69. is ailing 
and has been abandoned by 
almost all of his supporters, 
said General Nhiek Bun 
Chhay, deputy chief of staff of 
the Cambodian armed forces. 
“In the few days ahead, first. 
Pol Pot can lay down his 
arms; second. Pol Pot con kill 
all of his leaders and then kill 
himself.” the general said. 

He said Mr. Pol Pot had 
been penned in by about 
l .000 rebels from five Khmer 
Rouge divisions and barred 
from fleeing across the 
nearby border with Thailand 
by troops from that nation. 

That report could not be 
confirmed, however. And al- 
though it appeared that Mr. 
Son Sen nad been killed, 
political analysts here were 
puzzled by some of the details 
of General Nhiek Bun Ch- 
hay’s account and said his de- 
scription left it unclear just 
what happened in the early 
hours of last Tuesday. 

On Friday. Cambodia's 
first prime minister. Prince 
Norodom Ranariddh, said 
that gunmen acting oil orders 
of Mr. Pot Pot ha<f killed Mr. 
Son Sen, his powerful wife. 
. Yun Yat % and nine of their 

The repented rupture in the 
ruling clique followed nearly a 
■year .. of defections during 
which Mr. Pol Pot lost the sup- 
port of at least two-thirds of his 
army as the long-running 
Maoist insurgency collapsed. 

Speaking publicly for the 
Cm time about the week's 
events. Prince Ranariddh’s 
rival. Second Prime Minisrer 
Hun Sen. confirmed Saturday 
that Mr. Son Sen had been 
killed. But he urged caution in 
accepting the details of the 
event as described by General 
Nhiek Bun Chhay and said 
the situation continued to be 
‘ ‘very dangerou s. " 

In particular, he said he 

doubted a report from both 
Prince Ranariddh anti mi. 
general that after killing Mr. 
Son Sen, Mr. Pol Hot had 
■taken hostage three of nis oth- 
er top - lieutenants. Khieu 
Samphan. Nuon Cftea and r.i 

These are some of the mo.-l 
hated names in Cambodia- 
leading figures in a radical 
Maoist experiment in which 
this already poor nation wn- 
transformed into a primitive 
society where education, 
commerce, culture and reli- 
gion were forbidden. From 
1975 to J979, one-fourth or 
more of the population died n' f * 
torture, execution, di^ase or ’■ 

Vietnam invaded Cuinhcd 
ia and overthrew the Khnu 
Rouge in 1979, and fightin. 
continued until a peace agree- 
ment was signed in I9‘U. 
Elections supervised by the 
United Nations but boycotted 
by the Khmer Rouge were 
held in 1993. and Cambodia 
has struggled ever since 1 *' 
establish a democracy. 

The capital was filled Sat- 
urday with speculation and 
theories about the split tn the 
Khmer Rouge inner circle 
and about the future course of 

People here expect to hear 
the news in the coming day 
that the man who terrorized , 
them has finally been killed i' 
or that heJias been captured' 
and might appear among 
them for the first time in IS 

China Bums 
Illegal Drugs 

-4 cent r PiKiihL-Pwic 

China — Officials 
burned 150 kilograms 
1330 pounds) of drugs 
here Sunday, recalling 
the 19th century 
Chinesc-British Opium 
Wars that led 10 Britain's > 
"horrifying” coloniza- "• 
lion of Hong Kong. 

A century and a half 
after Chinese imperial 
Commissioner Lin Ze\u 
burned more than two 
million metric tons of 
opium seized lioin Bril- 
ish merch.uiK UMi 
people gathered here to 
witness the burning ot 
one hundred kilogram.-* ot 
heroin and 50 kilograms 
of amphetamines. Young 
people were warned nl 
the danger.* of drugs. 

Officials at the cere- 
mony admitted that 
China once again lud an 
increasing drag problem, 
which they said was due 
to “the influence of in- 
ternational society. " 


4 Arrested for Blase in India 

NEW DELHI — The police have arrested four theater 
'managers for suspected criminal negligence in a fire that 
swept the crowded premiere of u blockbu**ier movie. 
Sixty people were killed, most of them asphyxiated or 
trampled to death. 

A magistrate ordered the managers kept in prison for 14 
days while investigators begun an inquiry into why so 
many people were rrapped~in Friday’s inferno at the 
theater in suburban Green Park. 

• The authorities said the fire had started at a trans- 
former. and survivors said their escape from the theater 
Had been blocked by bolted doors. More than 200 people 
were injured. (Apt 

Rajnpage on Itidonesian Island 

JAKARTA — Hundreds of people n unpaged through .1 
town on the East Java island of Madura, torching shops a 
movie theater, a church and a Buddhist temple in the latest 
flare-up of violence in Indonesia, officials said Sunday. 

■A political party' official, who asked nor to be named, 
said the incident began when people attacked officials 
attending a thanksgiving ceremony for a town cleanliness 
award won by Bangkalan. 

"There is still concern among the population over 
widespread violations and fraud""d tiring (he recent elec- 
tions in Indonesia, but “officials are just having fun and 
being merry." said Fuad Amin, head of the local chapter 
isum-Ied United Development Party. He said the 

of the Mus 
peqple "just felt insulted.” 

(AFP 1 

Pills Make 600 III Near Beijing 

BEIJING — More than 600 schoolchildren fell ill after 
takihgexpired iodine tablets in a county near Beijina. and 
65 were hospitalized, a newspaper reported Sunday. 

No deaths were reported in the poisonings, which took 
placje over the past four days in Lang fang county, the 
China Daily said. The newspaper did nor describe the 
children's symptoms. 

Parents of about 1,000 children had bought the pilb 
a dietary supplement on the recommendation of -school 
authorities, the newspaper said. Itsaid the pills had passed 
their’ expiration date 10 months ago. The sellers of die 
pills, were arrested. ( AP) 

VOICES From Asia 

The Foreign Affairs Committee of China’s National 
People’s Congress assailing the European Parliament for 
its recent attack on Beijing’s policies on human riehfc and 
Hong Kong: "We would like to seriously demand of 
these people in the European Parliament that they should 
discard the told War mentality, conform to the trend of 
the times arid do something, useful for the healthv de- 
velopment of China-Europe relations.” t Reuters 1 

J : ; 



Guerrilla ! 
Of Pol Pot 

The European Summit / Cautious Optimism for a Deal to Save the Euro 


Mi * 

* i 

•if, i 

Irony in French-German Debate: Neither Model Is Working Well 

By John Vinocur 

JntemuuiHut Herald Tribune 

un inua uj avrwunuuH.y ana siagn 
new French proposals for Europe’s economy 
programmed first for illusion, then prof- 

AMSTERDAM — The German economic 
model leads to petty accountancy and stagnation; 

the OeW Frmi'Ti nmnncala Aw Cnpiuu*, ... 

are „ 

ligacy, then failure. 

To hear the two sides characterize one an- 
other’s positions in their dispute about the di- 
rection that European monetary union will taicw 
as the century closes is to think that if the 
European Union chooses one over the other at its 
summit meeting Monday and Tuesday in Am- 
sterdam, Europe is headed for tears. 

The French make- work view is “old-fash- 
ioned economic thinking, '* Wolfgang 
Schaeuble. leader of the Christian Democratic 
parliamentary group in Bonn, said over the week- 
end. “There’s something else besides monetary 
stability and mastering public expenditure/' 
Prime Minister Lionel Jospin insisted to Chan- 
cellor Helmut Kohl on Friday in Poitiers, France. 
“There's something else, growth and employ- 
ment, the straggle against joblessness, bringing 

policies together — and these are requirements in 
the face of poverty and precariousness. ’’ 
Privately, the tone sharpens further. For the 

Germans, the fight is against eternal socialist 
junk, the blah-blah that has brought a pyramid at 
the Louvre and an arch at La Defense (where the 
elevators don't always work), but nothing, ever, 
like prosperity or long-term prospects. For the 
friends of Mr. Jospin, the combat is aimed at the 
bank teller’s worldview, a Frankfurt rule book 
obsessed with monetarist infractions but cool to 
human concerns and so rigid as to imprison 
people and economies. 

This is an old waltz, with familiar dancers, 
caricatures of heartlessness and warmth, or of 


thrift and irresponsibility. What is new here is a 
discomforting irony about the alternatives. 

As much as the new French government’s 
ideas about creating employment through state- 
sponsored programs, tight regulation of the mar- 
ketplace and a willingness to create business by 
means of new public debt can appear part of the 
past, so do the outlines of the German model, or 
what economists sometimes call Rhenish cap- 
italism. An overbearing banking system, a weak 
equity market, an enormous public sector, stiff 
labor laws and near-institutionalized risk aver- 
sion — this German mold, producing massive 

unemployment and failing competitiveness, has 
very little to do with the methods of the more 
successful economies in the United Stales and 
Britain, or even the Netherlands or Denmark. 

Yet virtually all of the debate over Europe's 
economic future, in the context of European 
monetary union and its stability pact, has been 
between a France and a Germany that figured 23d 
and 25th in the ranking of world economic com- 
petitiveness established lost month by the World 
Economic Forum in Davos, Switzerland. 
Whatever the ranking's real worth — the United 
States is third and Britain seventh — the top 20 do 
not include any economies led by Keynesian 
theorists, or those where a central bank or labor 
unions have arguably disproportionate roles. 

In France, there is no certainty that the So- 
cialists, once they complete an audit of lhe na- 
tional economy, will want to practice at home the 
same theory they are now urging for Europe. 

As far as Germany is concerned, there is 
considerable talk about restructuring industry, 
freeing the labor market and changing the endless 
rales that govern things from the purity of beer to 
the number of years a sales assistant in a bakery 
must give to memorizing different sons of grains 
before emerging from apprenticeship. 

But the German model at home, or the one that 

is reflected in the German-dominated rales for 
the planned monetary union, plainly does not 
offer sufficient commitment to American-six le 
freedoms of lhe marketplace that could serve to 
counterbalance the strength and occasional polit- 
ical insensitivity of the” Bundesbank, or of its 
child-tn-be. the future central bank of Europe. 

German unions and politicians blocked, in 
seeming terror, lhe proposed takeover three 
months ago of Thyssen by Krapp. suggesting the 
country was not ready to deal with a certain kind 
of 1997 economic reality. For President Roman 
Herzog, the old model retards change, with his 
country living a vicious cycle of “resignation, 
blocked reforms and lost economic dynamism." 

Willi their instinctive rejection of deregulation 
removing the possibility of more reliance on the 
marketplace, the French Socialise have made 
clear they want to take a greater hold on the 
policies of the future European central bank 
through some kind of high-level economic 
policy-making group. This again clashes with 
German intentions, and carries the additional 
irony that France since Charles de Gaulle has 
been Continental Europe’s strongest opponent of 
any kind of European federalism. 

These circumstances have obscured less po- 
litically pressured discussions about the wisdom 

World Without the Euro? 

Some Economists Shrug, Others Shudder 
At Possibility of a Single Currency Flop 

By Joseph Fitchett 

International Herald Tribune 



PARIS — What if there were no euro? 
Suppose European governments aban- 
don their drive to create a single cur- 
rency: Would anything change in 
people’s lives? How different would a 
euro- less world be? 

Such questions are naturall y boiling 
up around the sudden rocky disputes 
between France and Germany, but an- 
swers are difficult to find, at least in any 
systematic form. 

“Any official study of that possibility 
is forbidden by my government because 
of fears that it could become a self- 
fulfilling prophecy/’ a French govern- 
ment planner said. 

When the hypothetical possibility was 
put to a score of economists and political 
analysts in ami out of government in 
Bonn, London, Paris and Washington, 
the experts responded with widely con- 
flicting economic scenarios ranging 
from rosy unconcern to forecasts of ru- 
inous commercial wars that would 
wreck die European common market 
and revive trade barriers. 

But the political consequences were 
seen as profoundly destabilizing by al- 
most all the experts and officials. Col- 
lapse of the planned monetary union 
would skew or even reverse the mo- 
mentum toward closer European unity, 
they said, exposing the Continent to die 
tensions arising from national ambitions 
and feats and perhaps tempting die 
United States or even Russia to start 
playing off some European countries 
against others. 

“It could be a fatal setback after 
Europe's failure in Yugoslavia/' a top 
German policy maker said. “Since 
Europe is not a political actor, people are 
wondering what is it good for.” 

The deepest purpose of monetary un- 
ion, he continued, “is to catalyze a Euro- 
pean core and show that European in- 
tegration is no longer reversible.’’ 

“Our big challenge is to reassure the 
new democracies that Europe is going to 
be there and include them, and getting 
the currency is die only way that we can 
credibly show that we can handle ex- 
pansion/' the German official con- 

That is what Chancellor Helmut Kohl 
has in mind in taking the argument to 
extremes and saying that the euro 
amounts to a choice, ultimately, of war 
andpeace for Europe. 

The push toward a single currency, 
essentially an economic operation, has 
always been rooted in a set of political 
goals. By welding the French and Ger- 
man economies, monetary union would 
seal a fault line that twice in this century 
engulfed the Continent in devastation. 
By inextricably binding the two coun- 
tries together, it would create a stable 
core for a concentric European equi- 

That fear and that vision, the experts 
said, explains why European leaders 
have laid their careers cm the line for the 
Maastricht treaty and monetary union — 
Europe’s most ambitious project for de- 

Jean-Paul Fitoussi, head of a think 
tank in Paris, said that a fiasco with the 
euro would be a political earthquake in 

A mother and her children strolling in front of a banner for the European Union summit in Amsterdam. 

Europe, toppling leaders in many capitals 
and opening breaches for extremists such 
as Jean-Marie Le Pen of France’s Na- 
tional Front 

His and similar groups in Europe 
thrive on nationalism, racism and pro- 
tectionism. but their appeal is thwarted by 
movement toward European integration. 

Now, that momentum is embodied in 
the euro. “For a lot of good economic 
reasons, it may not be the ideal vehicle 
for pursuing European integration, but 
the Europeans have tried everything else 
without any luck/ ' said Richard Cooper, 
a Harvard economics professor who was 
a senior Carter administration official. 

Attempts to align exchange rates got a 
sputtering start in the 1960s, only to be 
shattered by the 1973 oil crisis and Euro- 

pean inflation. Cobbling logeiher a new 
European approach took 10 years of 
work by French and German lenders. 
Perhaps the decisive moment came in 
1983, when President Francois Mitter- 
rand of France chose lo subordinate his 
leftist, nationalist and inflationary policy 
to budgetary austerity and financial or- 
thodoxy in order to save the special 
relationship with Germany and not de- 
rail European integration. ’ 

That shared French-German approach 
culminated at Maastricht, which adopted 
the blueprint of a new European edifice 
with a single market as its floor and a 
single currency as its roof. 

The euro, always controversial, had 
acquired irresistible political luster since 
German reunification. A single currency 

Europe Ponders Success of Dutch ‘Third Way’ 

By Marlise Simons 

New York Tones Sen-ice 

i If f h 

ffaMfinw tifi 1 

AMSTERDAM — Hie Dutch are 
used to living with a potent mix of 
neighbors, whom they often see as more 
assertive, pushy or flamboyant than 
themselves. They watch the mighty Ger- 
mans, the elitist French and the insular 
British and sometimes get a little sour 
about being ignored while others drive 
European affairs. 

So, it is with some bemusement that 
the Dutch suddenly find themselves up- 
held as a model for the rest of Europe. 

In the weeks preceding the meeting of 
European leaders that begins here Mon- 
day, a procession of foreign economists, 
sociologists and labor union and polit- 
ical figures have visited here, seeking to 
understand what has kept the Nether- 
lands so stable, prosperous and curiously 
without strikes. 

As Europeans wring their hands over 
how to change and how to deal with the 
apparent choice between what some see 
as heartless American-style moderniz- 
ing of their economies and preserving 
die old European social safety nets, 
many people say the Dutch appear to 
lave found a “third way,” one com- 
bining an open, vigorous market with 
generous social benefits and a measure 
of social justice. 

Critics point to the high percentage of 
temporary jobs, social benefits they say 
are still too expensive and problems 
resulting from a more competitive mar- 
ker. But for the last five years the Dutch 
economy has grown faster than those of 
Britain, France and Germany, and un- 
employment, at 6 5 percent, is well be- 
low that of die large European coun- 

Skeptics also say the Dutch “model” 
still has a way to go before it has trimmed 
the unaffordable 'fat from the welfare 
state. Some 800,000 people in a pop- 
ulation of 15 million are at home, drawing 
generous disability pay for mild or vague 
ailments, including^ ‘stress.” Still, that is 
100,000 fewer than three years ago, when 
the government tightened the rules. 

The Dutch example has begun to gain 
wide attention in Europe with the ap- 
proach of next year’s deadline for the 
strict criteria countries must meet if they 
want to join the common European cur- 
rency. Countries aspiring to use the cur- 
rency, called the euro, have been forced 
to make economic reforms and impose 
austerity that has triggered social unrest 
and antagonized voters. The Amsterdam 
meeting is expected to sign a pact that is 
another prelude to guaranteeing the 
euro’s stability. 

The Dutch say they have invented 
nothing new by keeping down wages, 

inflation and interest rates and by 
loosening the rules for hiring and firing 
people and for opening new businesses. 

But what is different here, often as- 
tonishing foreign pundits and investors, 
is the painstaking consensus-boil ding 
that has avoided social unrest and made 
the changes, possible. In contrast to the 
convulsions of bigger neighbors like 
Britain. France and Spain, the pragmatic 
Dutch have worked on avoiding ideo- 
logical confrontations and for more than 
a decade have sustained a pact between 
left and right. As long as labor unions 
accepted financial discipline, manage- 
ment has not demanded the dismantling 
of the welfare state as the price of in- 
vesting and creating jobs. 

In May, the Organization for Eco- 
nomic Cooperation and Development, 
the Paris-rosed think tank of the indus- 
trialized nations, noted the Dutch suc- 
cess, saying the country had found a way 
to tackle unemployment and introduce 
reforms “through a consensual process, 
involving the social partners and clearly 
not threatening social cohesion.” 

Now in the spotlight as the host for the 
European meeting. Prime Minister Wim 
Kok is a discreet and skillful negotiator. 
He is widely credited as the chief ar- 
chitect of the “social pact’’ between 
government, employers and labor un- 
ions that has ensured Dutch stability. 

As the country's top labor leader, he 
helped launch the pacr in 1982 under 
which labor federations kept to wage 
demands of 2 percent a year, in exchange 
for shorter work weeks and job creation. 
He stuck to austerity as the Labor Party's 
finance minister from 1989 to 1994, the 
year he became prime minister as leader 
of a left-right coalition. 

The Dutch say their achievements 
have come from tough and continuing 
negotiations, not from a miracle recipe. 
As Cees Oudshoom, an official at the 
Economics Ministry, put it: 1 ‘The Dutch 
miracle, if it exists at all, is that our labor 
unions could be convinced to rally 
around a free- market economy." 

Signs of a flourishing marker abound. 
On the outskirts of Amsterdam and 
around Rotterdam, the world's busiest 
port, new office parks have drawn for- 
eign companies. The normally spend- 
thrift Dutch consumers are. driving up 
sales in stores, which only last year got 
permission to stay open after 6 P.M. and 
on Sundays. 

To draw more people, especially 
women, into the work force, the gov- 
ernment has deregulated working hours, 
allowing previously unthinkable part- 
time and temporary contracts. This has 
turned employment agencies into a 
growth industry, now employing more 
than 12.000 people. 

acquired a new image as the golden 
threads which could restrain the giant 
Gulliver in Europe’s midst. 

In economic terms, experts were 
sharply divided about how Europe 
would fare if the euro is aborted. 

"Ironically, it probably doesn't really 
matter now because the euro has already 
succeeded." said Philip Gordon, an 
American analyst at the International In- 
stitute of Siraiegic Studies m London. 

The euro’s main purpose, he con- 
tends, was to help Paris and other in- 
flation-prone capitals wean their econ- 
omies from their postwar habit of 
offsetting wage hikes not with increased 
productivity but with devaluation and 
inflation. A reputation for soft money 
meant that French international borrow- 
ers had to pay a premium on top of 
interest rates. 

To improve their long-term compet- 
itive position, French elites concluded 
that Paris needed to prove its policy dis- 
cipline. The euro was the ideal vehicle 
because it meant pegging the French franc 
io the Deutsche mark and raising interest 
rates whenever inflation threatened. 

It worked. After more than a decade, 
“cheaper borrowing is available for 
France,” Mr. Gordon pointed out. 

Now, Italy and Spain have embraced 
this orthodoxy, so the inflation-devalu- 
ation cycle lias been broken, presum- 
ably, he said, even without the euro, at 
least in the short run. 

This rosy outlook is dismissed in 
Europe. True, officials said, govern- 
ments have become wary of importing 
inflation by devaluing their currencies. 
But that risk no longer exists in the 
current deflationary climate. 

Mr. Fitoussi, who has often called for 
more flexibility in France's approach to 
the single currency, agreed that "with no 
euro, there will be an overwhelming 
incentive for countries to engage in com- 
petitive devaluations and even trade 

Protectionism would threaten Europe 
and its trading partners in America and 
Asia, officials said, but as chaos spread 
in the European economy, a Deutsche 
mark zone would emerge, extending the 
writ of the Bundesbank. 

That prospect was exactly what 
France sought to preempt by supporting 
a European Central Bank, where the 
German voice could be diluted, to man- 
age the future euro. 

of the stability' pact that carries the numerical 
elements of monetary union's convergence cri- 
teria — which have teen held responsible in part 
for Europe's austerity budgets and high unem- 
ployment — into the indefinite future. And they 
have drawn attention away from the message that 
Prime Minister Tony Blair, who will make his 
first appearance representing Britain at a Euro- 
pean summit meeting, has been putting out in the 
run-up to Amsterdam. 

With his government continuing to keep to the 
sidelines with a wait-and-see attitude toward 
joining monetary union, there are limits to Mr. 
Blair’s urging and involvement. Bui he can re- 
peal his desire to promote "the marriage of a 
more human .society with economic cumpei- 
iiiveness and flexibility in employment.' 

Mr. Blair insists, as does President Bill Clin- 
ton. that the marriage can be made. Regardless of 
lhe French and German positions, and the polit- 
ical maneuvering that entrenches them, their 
history since Konrad Adenauer and General de 
Gaulle shows unvarying willingness to find rea- 
sonable solutions. 

Their distance from one another, and their 
distance from the thinking that best exemplifies 
the currently successful economies, makes that 
more than usually difficult today. 


Europe 1$ Crumbling 

Continued from Page 1 

Bui much bigger problems are just 
around the corner. Between now and 
July 10. German leaders must cither 
slash billions in government spending or 
acknowledge that they cannot reduce 
their budget deficit to the strict limits 
required to create the euro. 

Most experts are convinced that Mr. 
Kohl has already lost the budget battle, 
and new estimates circulating in Bonn 
indicate that the deficit next year could 
rise by 30 billion marks, or SI 7.4 bil- 

That leaves Mr. Kohl with a wrench- 
ing choice: delay the euro, which would 
probably kill it and deprive him of n 
coveted spot in hisioty. or soften the 
tough standards that were supposed to 
give Germans enough confidence to 
trade in their rock-solid Deutsche marks 
for the untested euros. 

"What we have is political actors who 
failed to anticipate what was going to 
happen/’ former President Valery Gis- 
card d'Estaing of France said in an in- 
terview. “They are being forced not by 
the goal of the euro but by the inev- 
itability of the euro." 

Mr. Giscard d'Estaing said French 
leaders of oil stripes stil l needed to adjust 
their thinking. 

“Mr. Chirac and Mr. Jospin both be- 
long to the traditional school of French 
thinking, which puts emphasis on a large 
role for the state in leading the econ- 
omy." he said. 

But those ideas are untenable at a time 
when companies can easily move fac- 
tories and operations to more comfort- 
able countries in which employees are 
cheaper and easier to hire. 

“They have yet to realize that those 
days are over," the former president 

Most financial and political experts 
are still betting that the new single cur- 
rency will have its debut as planned on 
Jan. 1 . 1999. But the anxieties ore grow- 
ing that the whole project could unravel 
or that the euro will be a much weaker 
currency than advertised. 

The stakes go well beyond currency 
speculation. Because countries can qual- 
ify for the euro only if they achieve low 
inflation and relatively low budget def- 
icits, nations from Spain to the Neth- 
erlands have been slashing social pro- 
grams and reinventing themselves along 
lines that would make American free- 
market advocates blush. 

In many ways, the process has pro- 
duced a debate in Europe over now 
European countries reshape their eco- 
nomic models and over the role of gov- 
ernment. Highly centralized models, 
like France, are viewed as costly and 
uncompetitive. Leaner, free- market 
models, like Britain, are viewed as 
healthy but austere. 

“There is an absolute division about 
how Europe should progress," said 
David Battman, an economic consultant 
in Brussels. “The euro debate is merely 
bringing this to a head." 

Supporters fear that the process will 
stall if the euro collapses or if the prin- 
ciples get seriously watered down. The 
budget-cutting medicine that the plan for 
the euro requires is exactly what Europe 
needs, experts say. 

Meanwhile, unemployment in most 
European countries continues to ran at 
more than 10 percent, and voters are 
losing patience with talkabout euros and 
cuts in government benefits. 

SUMMIT: Cautious Optimism Germany and France Will Find a Compromise on EU Stability Pact 

I -a 

nff. \lnh Olllil ' 


; i-, 4_ 

I - 

- Continued from Page 1 

Luxembourg officials said Mr. Juncker, 
-.whose government will take over the EU 
presidency next month, had offered to hold a 
"fecial summit meeting on jobs in October to 
Kip address the French concerns. 

Finance Minister Dominique Strauss-Kahn 
of France also said the leaders would “find a 
solution on Monday." 

"The deal would have France join itspart- 
nm in endorsing a stability pact c omm itting 
’ EU countries to permanent budgetary re- 
straint. an essential German condition for 
l apnirhi ng the sm gfr currency, while Germany 
would bow to the demands of France’s new 
Socialist government for new. commitments 
to cooperate on employment policy. ■ 

Union officials said they fear that a failure 
to conclude the stability pact at the summit 
-rmraing would fan doubts about a delay or 
/collapse of monetary union and trigger tur- 
moil On financial markets. y 

r‘- fedeed, it was a testament to the pacts 
importance that the debate was overshad- 
. owing. what was to have been die meeting's 
ceateqpiece: oooclusiod erf a new EU treaty to 
enable "the Woe -to -expand- into Easton 
Europe. . 

“The stakes are very high," said Yves- 
Thibault de Silgny, the EU commissioner for 
monetary affairs. 

While fear of failure was pushing France 
and Germany toward compromise, both sides 
remained divided Sunday on whether the new 
employment commitment would be anything 
more than rhetorical. Tough comments from 
both sides of the Rhine indicated that 
whatever agreement might emerge from the 
summit meeting, it was unlikelyfo resolve the 
fundamental French-German struggle over 
economic policy. 

French officials continued to press for 
some way to pump new money into 14 major 
European highway and rail infrastructure 
projects, which include a high-speed train 
finking Amsterdam with Paris, London and 
Cologne: Those projects were the brainchild 
of Jacques Delors, theformer European Com- 
mission president and close adviser to Mr. 
Jospin, but they have languished in obscurity 
in recent years as EU governments have cut 
their : bodgets to prepare for monetary union. 

‘‘There most be something concrete, a 
French official said. 

Mr. Jospin raised the issue at a meeting witn 

Mr. Kohl' on Friday but was rebuffed, with 
German officials seeing the projects as merely 


an opening French bid to reflate Europe’s 
economy with public spending. 

On Sunday, senior German politicians 
opened a concerted verbal attack that served 
both as a preemptive warning to the French 
and an attempt to reassure their own voters, 
who remain skeptical about lhe worth of the 
planned euro. 

Finance Minister Theo Waigel said Ger- 
many was ready to step up coordination of 
broad economic and employment policies 
with its EU partners but would reject any 
proposal for new public spending. “We will 
stick to our position that there will be no 
money flowing from Germany for additional 
jobs-oreation programs," he said. 

Edmund Stoiber, the Bavarian premier 
whose rigid monetary orthodoxy poses the 
biggest political constraint on Mr. Kohl and 
Mr. Waigel, stressed that toe Deutsche mark 
was “inseparably" linked to Germany 's post- 
war recovery and that anyone who sought to 
replace it with a weak euro “would destroy 
too public's confidence in politicians and 
damage toe democracy in Germany.” 

Monetary union “will begin on Jan. 1, 
1999, as a stable union, or it must be post- 
poned, and until such a time as toe pre- 
conditions are in place," he said. 

Mr. de SUguy suggested that a possible 
compromise could involve new spending 
commitments for the projects by the Euro- 
pean Investment Bank, the Union's leading 
development bank. But he ruled out any in- 
crease in the EU budget as out of step with the, 
fiscal discipline required for monetary un- 

* Dini Says Conflict Will Be Resolved 

Alan Friedman of the International Herald 
Tribune reported front Amsterdam: 

The Italian foreign minister. Lamberto 
Dini, said he was confident that differences 
between France and Germany would be re- 

“There will be an agreement and we will go 
ahead/’ Mr.- Dini said Saturday. “There will 
be a deal.” 

Mr. Dini also suggested that there would be 
room for a flexible interpretation of the 
Maastricht targets on government deficits. 

“We should not worry if at the- time of 
decision-making next year the number is 3.1 
or 3.2 percent. We should be concerned 
aboutlhe overall evaluation that government 
heads will make, otherwise our government 
leaders would not be very intelligent,” he 


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MONDAY, JUNE 16 , 1997 






Turkey’s Generals 

Turkey's restive generals are press- 
ing Prime Minister Necznettin Erbakan 
of the Islamic Welfare Party to leave 
office in the next few days. Their ac- 
tions amount to a backdoor coup 
against parliamentary democracy. The 
generals claim to act in defense of 
secularism and Turkey’s Western ori- 
entation. But their intervention will 
only damage Turkey’s reputation in 
the West. 

Last week the army increased the 
pressure by taking its case against Mr. 
Erbakan to prosecutors, intellectuals, 
journalists and civic leaders. This cam - 
paign was backed by an implicit threat 
to use force unless Mr. Erbakan yiel- 
ded office to his secular coalition part- 
ner, Tansu Ciller. 

The generals seek to enforce a deal 
Mr. Erbakan made last year with Mrs. 
Ciller. Turkey’s constitution does not 
recognize such prearranged alterna- 
tions. If Mr. Erbakan resigns. President 
Suleyman Demirel should decide 
whether his successor would be Mrs. 
Ciller or a caretaker empowered only 
to organize new elections. 

Mrs. Ciller was the politician most 
responsible for Mr. Erbakan's orig- 
inally coming to office. Welfare won 
just over 20 percent of the votes in 
Turkey; more than any other party. But 
without support from Mrs. Ciller’s 
True Path Party, it could not have 
assembled a majority. 

In a multiparty system, the front- 
running parly has no guaranteed claim 
lo win the prime minister's job if the 
party fails to win a parliamentary ma- 

jority. In Mr. Erbakan’s year in office, 
he has made serious foreign policy 
blunders, like trips to Iran and Libya 
that seemed designed to provoke Tur- 
key’s main military ally, the United 

The Erbakan government has also 
made it easier for Islamic groups to 
display their faith and promote their 
teachings. That has brought unwar- 
ranted fears among many secular 
Turks that their country is about to turn 
into another Iran or Afghanistan. 

But in a democracy, it is not the 
army’s role to push prime ministers out 
of office. Turkey’s constitution makes 
the army the official guardian of sec- 
ularist traditions. The military has 
seized on this role to stage three coups 
since 1960. Each one has weakened 
Turkish democracy. 

The coups have also emboldened the 
army to block political solutions to the 
unrest among Turkey's Kurdish 
minority and to tensions with Greece 
over Cyprus. Military influence has 
also aggravated Turkey’s severe hu- 
man rights problems. 

The military has provided no an- 
swers to the country’s underly- 
ing political problems, which include 
a narrow, personality-based party 
system and a chronic susceptibility 
to corruption. The army’s latest ma- 
neuvers against Mr. Erbakan can 
only reinforce this damaging tradi- 


Obsession Turned Inward 

Timothy McVeigh’s violence has 
ended, and he now faces death by lethal 
injection. But the violence of die mi- 

litias that Inspired him has probably 
: militias are 

not been extinguished. The l 
different from anything that preceded 
them because they gather not to take 
out their rage on Communists or 
minorities, but to wage war against a 

g overnment they consider treasonous. 
i recent years militia groups have 
assaulted, harassed and threatened 
scores of government officials. 

It is difficult for most Americans to 
take seriously a group of people whose 
targets include America’s county 
clerks and whose members hold that 
manufacturers* labels on the backs of 
road signs actually point the way to the 
nearest concentration camp. But mi- 
litia ideology has already provoked the 
Oklahoma City bombing, the worst act 
of terrorism ever to take place on 
American soil Since that act. the mi- 
litias have continued to grow, and the 
possibility of more terrorism is un- 

Some counties in America can no 
longer enforce their land, tax and 

If these events had occurred in the 
1980s, they might not have galvanized 
people like Timothy McVeigh. Bur 
with the end of the Cold War. it may be 
dial-conspiracy theories once obsessed 
with Communism tamed inward to- 
ward the American government. The 
militias, most of which operate in 
small, autonomous groups, now also 
have the Internet to propagate theories 
and plans. 

State officials say that the Oklahoma 
City bombing has not slowed militia 
activity. White some moderates left the 
movement revulsed, Mr. McVeigh 
has become a martyr for the hard core, 
many of whom believe the bombing 
was carried out by the government to 
justify a crackdown on American 

liberty. Terry Nichols, also charged in 
the Ok ' 

weapons laws, unwilling to risk that an 

employee might be attacked by militia 
members. Fire fighters say they cannot 
fly helicopters over land owned by 
certain militia members for fear they 
will be shot down. 

In at least 23 states, militia members 
have filed phony liens against local 
officials. Government employees are 
so vilified in some communities that no 
one will sit with them in church. 

The militias are a particularly in- 
sidious strain of the American viruses 
of paranoia and violence. They echo 
the white supremacy of the Ku Klux 
Klan and the conspiracy theories and 
gun obsessions of the John Birch So- 
ciety. They draw on the American icon 
of the man who wants to be left alone to 
live by his creed, taking ideas and 
leaders from the rural Posse Comitatus 
movement that reached its peak during 
the farm crisis of the 1980s. 

The militias were energized by the 
1992 siege of the fugitive Randy 
Weaver’s farmhouse, in Ruby Ridge. 
Idaho, in which Mr. Weaver's wife 
and son were killed by federal ag- 
ents. A year later came the attack on 
the Branch Davidian compound in 
Waco, Texas, and the subsequent fire 
that killed about 80 cult members. 
These events, both deplorable uses of 
excessive force, convinced some 
Americans that the government was 
determined to take away their free- 

Then came the Brady Bill, which 
mandates a waiting period for handgun 
buyers. Gun control was people con- 
trol to militia members, some of whom 
believed they could only be safe from 
tyranny if they had more firepower 
than the army. 

)klahoma City bombing, has 
closer militia connections. His trial 
may provide the faithful with an even 
more inspiring cause. 

The bombing has not spurred the 
political action that it should. 

Congress has held only two days 
of hearings on the militia movement, 
one in each house. Some members of 
Congress, such as Representative 
Helen Chenoweth. Republican of 
Idaho, are sympathetic to militias. She 
has introduced what she calls a "civil 
rights” bill requiring federal law en- 
forcement officers to get the written 
consent of local agencies before en- 
forcing the la\y. 

Some local and state legislatures in 
the West have supported the militias. 
Other legislators at all levels have kept 
silent because they do not want to 
alienate more mainstream groups with 
militia sympathies, such as the Na- 
tional Rifle Association. 

Those threatened by the militias 
need better security and more laws at 
the national and state level raakiag it 
easier to prosecute people who ter- 
rorize public officials. The govern- 
ment must also show restraint in deal- 
ing with potentially bloody 
confrontations. The Federal Bureau of 
Investigation demonstrated welcome 
patience during the 81 -day Freemen 
standoff in Montana last year. The 
peaceful resolution of that showdown 
deprived militia members of a new 

The Freemen standoff also showed 

tion of violence. The Freemen found 
little support in surrounding com- 
munities. While militia forces thrive 
on government attacks, they cannot 
withstand the disdain of their neigh- 
bors. The militias are so widespread 
because they ostensibly draw on ideas 
strongly rooted in American history. 
But even citizens with sympathy for 
those ideas need to distinguish be- 
tween their peaceful and their violent 


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China Wants an Even More Succes 

JJQNG KONG — China wants 

Hong Kong to be even more suc- 

By David K.P. Li 

cessful in the future than it has been 
under British rale. China could have 
taken the territory back from Britain at 
any time over the last 50 years — but it 
did not China could have demanded 
the return of Hong Kong with no guar- 
antees about maintaining its current 
system — but it did not. 

China wants to be a respectecLmem- 
ber of tire international co mm unity. 
Like Germany not so long ago, it wants 
to be reunited At the end of this month, 
China will be reunited with Hong 
Kong. On Dec. 20, 1999, it will be 
reunited with the nearby Portuguese- 
administered territory of Macau. At a 
future date, the Chinese mainland 
wants to reunite with Taiwan. 

To win respect internationally, and 

to gain the confidence of the people in 
: that H< 

Taiwan. China has to ensure that Hong 
Kong continues to prosper. The eco- 
nomic success of the territory can then 
serve as a goal for the whole of China. 
. If, on the other hand, Hong Kong 
experiences less success than it en- 
joyed under the British, China would 
be humiliated. The implication would 
be that foreigners can run China better 
than the Chinese. It would be the ul- 
timate loss of face. 

It would also be a serious loss of 
money for China, which has a great deal 
invested in businesses and real estate in 
Hong Kong. Britain, ioo, wants Hong 
Kong to do welL It has many citizeas 

and companies here. The same applies 

5, Jar 

for Germany, the United States, Japan 
and many other countries with exten- 
sive interests in Hong Kong. 

The disagreements between Britain 
and China over Hong Kong have arisen 
because the two sides have different 
views of what is best for Hong Kong. In 
the last five years, Britain introduced 
some significant changes to Hong 
Kong's political structure. These in- 
cluded a new system of elections and a 
bill of rights. 

To Britain, it was a matter of honor 
to introduce these changes, even 

though it had only a few years left to 
rule and lacked Beijing’s consent For 
that reason alone, given China's ex- 
treme sensitivity to foreign interfer- 
ence, it is a matter of honor for China to 
reverse the changes. 

The symbolism is powerful. But the 
practical effect of all this is almost 
certain to be insignificant. 

There were no fully democratic elec- 
tions to rhe Hong Kong legislature until 
two years ago. Former U.S. Senator 
Sam Nunn made this point very well in 
a recent speech. "Hong Kong was 
seized by force from a weak China. The 
British ruled Hong Kong a u British 
colony — not a democracy,” he said. 

After the transfer of sovereignty to 
China, Hong Kong will develop rep- 
resentative government under the Basic 
Law, which is often referred to as the 
mini-constitution of Hong Kong be- 
cause it codifies the rights of the ter- 
ritory and its people. Elections for a new 
legislature will be held in the fust half of 
1998. China could not — on principle 
— have allowed Britain to implement 
such steps unilaterally. That would 
have amounted to foreign interference. 

China also wants some changes to 
Hong Kong’s bill of rights. This will 
not affect the long-standing traditional 
freedoms of Hong KoBg's people — - 
those are protected under the Basic 
Law. Article 39 of the Basic Law states 
that the two main United Nations cov- 
enants on human rights will continue to 
be applied to Hong Kong after the 
handover. They are the International 
Covenant of Civil and Political Rights, 
and die International Covenant on Eco- 
nomic, Social and Cultural Rights. But 
the British administration of Hong 
Kong wrote the bill of rights in such a 
way as to make it override ail other 
Hong Kong laws. China objects to this 
unprecedented status. 

These disagreements have been un- 
fortunate. Britain's changes were un- 
popular among some in the Hong Kong 

community; China’s decision to fej- ‘.foe overseas Chinese have the 
verse them is unpopular among orhezS.rifc»cisehoW incon® levels and 
The international media have hig-hr.; levels of any ethnic 


lighted these disagreements. 

What they dp not point out is that, Hr. 
virtually all other respects, the transfer 
of sovereignty is going very smoothly, 

The two countries have agreed on a _ 

wide range of issues char will enable 6 .-less, the overseas Chinese are die main 
million people to cany on with their . investors in China. For them— lead fa- 


. Increasingly^ 
places, they are making a cob-; 
Lto politics. 

'Using Hong Kong as their headquar- 

lives as if nothing had happened. 

It is true that there has been un- 
certainty at times since .1982, when 
China and Britain started negotiations 
on tine handover and Hong Kong’s fu- 

To win international 
respect, and to gain 
Taiwan s confidence, 
Beijing must make sure 
Hong Kong prospers . 

ture. Today, however, there is a real 
sense of excitement in die temtoty. Far 
from seeing the transfer as undesirable, 
people are anticipating new and greater 
opportunities. Hong Kong is excited 
and confident about the future because 
it has already reunited economically 
with China, the world’s greatest po- 
tential market. 

The reforms introduced under Deng 
Xiaoping have increased Hong Kong’s 
prosperity just as much as China's. 
Hong Kong is die service center linking 
an increasingly powerful Chinese 
economy with the rest of die world. We 
are in an enviable position. Investment 
in world-class telecommunications and 
new port and airport facilities is provid- 
ing us with the best infrastructure in the 

Moreover. Hong Kong is die capital 
city of die “overseas Chinese.’’ This 
community forms a global network of 
60 million entrepreneurs who, if they 
were a country, would have die same 
gross domestic product as China itself. 

In both the United States and Britain, 


of sovereignty will far- 
ther strengthen the territory's position. 
It will deepen our involvement in the 
development of China. 

Already. Hong Kong’s people are 
helping Chinese organizations adopt 
modem international financial, account- 
ing and legal practices. Just as C hina 
today draws heavily on Shanghai for ks 
senior leadership, so in the future will it 
be able to draw on Hong Kong. For die 
first time, die young people of the ter- 
riroty can look forward to the oppor- 
tunity to help develop an entire nation. 

I believe they will nave an even more 

important role. They wilibe able to 
help brin 

Ip bring C hina arm the West closer 
together. The relationship between the 
two civilizations sometimes seems to 
be going in the wrong direction. Many 
Chinese strongly believe that the West 
is eying to contain their country eco- 
nomically. Some in the West fear 
China’s influence in world politics, 
which is bound to grow. 

If we fail to boild trust and un- 
derstanding between China and the 
West the repercussions for the whole 
world could be serious. But the world 
will benefit if we respect one another as 
equals. Everyone will gain if we choose 
partnership and cooperation. 

The writer. chairman and chief c.t- 
ecutive of the Bank of East Asia Ltd., 
was a vice chairman of the committee 
that drafted Hong Kong's Basic Law 
before it was promulgated by China's 
National People's Congress in Feb- 
ruary 1990. He contributed this com- 
ment to the International Herald 

He Knew Watergate — and Whitewater Is No Watergate 

week is the 25th an- 
niversary of die Watergate 
burglary, but this inglorious 
moment is hardly ancient his- 
tory. We Americans are living 
daily with the legacy of Richard 
NLxon and the men who com- 
prised his inner circle. 

Their gross misuse of power 
spawned a vims that lingers on, 
and its murant strains have in- 
fected the ways in which the 
Congress, the press, the courts 
and the White House now pro- 
cess allegations of wrongdoing. 

Of course, the most important 
and enduring lesson of Water- 
gate is that our system was 
strong enough to purge itself of a 
president who had so abused the 
public trust But underneath that 
shining reaffumation of our 
constitutional democracy is Wa- 
tergate’s scar tissue, principally 
the diminution of the credibility 
of the office of the presidency. 

I see the past and present 
circumstances from rhe vantage 
point of having served as a se- 
nior member of the Watergate 
Special Prosecutor’s team that 
investigated and prosecuted the 
Watergate cover-up case 
against President Nixon's aides 
and. more recently, as the chief 
minority counsel to the Senate 
Whitewater Committee. 

In my view, there can be no 
legitimate comparison between 
Watergate and Whitewater. For 
those who may have forgotten 
the details, and for younger 
readers who weren't alive dur- 
ing Watergate, a brief review of 
the facts might be helpful. 

By Richard Ben-Veniste 

The break-in and burglary of 
die Democratic National Com- 
mittee’s headquarters at the 
Watergate office building in 
Washington on June 17. 1972, 
was not the isolated and loopy 
’ ’third-rate burglary’ * portrayed 
by the Nixon administration. It 
was a significant violation of 
law authorized by Nixon in- 
siders at the highest level — if 
not the president himself — to 
continue illegal electronic 

The abuse of 
presidential power 
is nowhere to be 
found after four 
years of 
investigating the 
Clintons . 

eavesdropping and photograph- 
ing of confidential records. 

. But the Watergate break-in 
was just one link in a chain of 
abuses that Nixon Attorney Gen- 
eral John Mitchell aptly dubbed 
the "White House horrors." 

These included the break-in 
at a psychiatrist's office looking 
for information that could be 
used to smear Daniel Elisberg, 
who had exposed the secret 
government history of the Vi- 
etnam War known as the 
Pentagon Papers; the misuse of 
federal agencies to punish those 
on the president's "enemies 

list”; the illegal wiretapping of 
journalists and members of Mr. 
Nixon's own administration; 
the deliberate falsification of 
government documents to en- 
hance Mr. Nixon’s political 
agenda; the proposed firebomb- 
ing of the Brookings Institution 
as a diversion for the theft of 
records; the surreptitious sur- 
veillance of political opponents, 

' and the willingness to use thugs 
to brutalize political protesters. 

The subsequent cover-up was 
not an irrational response to an 
insignificant, stupid break-in. 
Rather, it became necessary to 
counter the threat that the. ad- 
ministration’s widespread ab- 
uses of governmental authority 
would be exposed once inves- 
tigators began asking questions. 

As the cover-up unraveled, 
facts emerged about the extent 
of .Mr. Nixon’s willingness to 
abuse his power to prevent the 
truth from coming oul Mr. Nix- 
on directed the deputy direcror 
of the CIA to tell the FBL 
falsely, that the country’s na- 
tional security would be jeop- 
ardized by a full investigation 
of the money trail left by the 
Watergate burglars. 

Acting on the president’s in- 
structions to lie under oath, sev- 
eral top advisers committed 
perjury, including Mr. MitcheU, 
who had been the nation’s chief 
legal officer, and Mr. Nixon’s 
chief of staff, H. R. Haldeman. 

There was more. Offers of 
presidential clemency were ex- 
tended to certain members of 

the burglary team, and all were 

The Special Genius of Scotland 

N EW YORK — It is a 
hopeful augury for Bri- 
tain. and indirectly for ail of 
us. that Scotland and its off- 
spring are again making his- 
tory. Not long after an Ed- 
inburgh research team 
succeeded in cloning the first 
grown animal, the Edinburgh- 
born Tony Blair led the La- 
bour Party back to power. 

Most firtingly. Mr. Blair has 
announced that his new gov- 
ernment is giving highest pri- 
ority to improving education. 

Scotland is a classic ex- 
ample of the difference that 
better schools can make. His- 
torians reckon that for its size 
(about 5 million people) Scot- 
land has spent more on edu- 
cation in rite past than any 
European country, with daz- 
zling results. Scottish scien- 
tists gave the world insulin and 
penicillin (John Macleod and 
Alexander Fleming), dis- 
covered the cause of malaria 
(Ronald Ross) and transmitted 
the first television image (John 
Logie Baird, 1925). All but 
Mr. Baird won Nobel Prizes. 

This fecundity has a long 
history. In the lSth century. 
Edinburgh and Glasgow were 
the crucibles of what became 
known as the Scottish Enlight- 
enment. One of its luminaries. 
Adam Smith, described edu- 
cation in 1 776 as a basic civil 

By Karl E. Meyer 

right, remarking in “The 
Wealth of Nations” chat a per- 
son "without the proper use of 
the intellectual faculties” was 
"mutilated and deformed." 

To be sure, the system 
Smith favored was meritocrat- 
ic rather than democratic, but 
Scottish schools were gener- 
ations ahead of those else- 
where. The philosopher David 
Hume was unusual among En- 
lightenment notables in being 
. bom rich. Most of his peers 
rose from the middling rungs 
of a society open to ambitious 
mates with pluck and brains. 

”1 was bom a Scotsman, 
and a bare one." wrote Sir 
Walter Scott. ."Therefore I 
was bom to fight my way in 
the world." 

The seeds were planted by 
Protestant reformers like John 
Knox, who saw education as a 
necessity in his Godly Com- 
monwealth so humble com- 
municants could read the 
Bible. By 1750, literacy was 
near universal in the Low- 
lands, and overall standards so 
high thai Robert Bums, the 
son of a poor farmer, attained 
fame as a poet without attend- 
ing an elite grammar school 
or college. 

Scottish universities were 

the focus of special pride. 
Well into the 19th century die 
Scots supported four uni- 
versities to England’s two, 
Oxford and Cambridge. The 
oldest was Sl Andrews (foun- 
ded in 1411), followed by 
Glasgow (1450), Aberdeen 
( 1494) and Edinburgh (1582). 
From these and innumerable 
smaller academies came the 
engineers, teachers, preachers 
and soldiers who streamed to 
the Americas and every comer 
of the British Empire. 

How dud this remote comer 
of an offshore island throw off 
such energizing particles? In 
addition to Knox’s teachings 
and the dismal climate, there 
is this persuasive explanation, 
offered by Sir Hugh Lyon 
Playfair, the provost of SL An- 
drews in the 1840s: "Educa- 
tion in Scotland is the essen- 
tial source of its prosperity, 
for it has scarcely any natural 
sources of wealth.” 

None of this is new to Mr. 
Blair, a graduate of Fettes Col- 
lege in Edinburgh, an out- 
standing private secondary 
school. He knows British 

standards have slipped and 
un. He would 

vows to raise them 

do us all a favor by promoting 
some friendly rivalry on this 
score with his fellow Oxonian 
in the White House. 

The New livt Times. 




paid significant s ums from a 
secret slush fund — financed by 
campaign contributions, .con- 
trolled by the president and Mr. 
Haldeman and delivered by the 
president’s personal attorney. 

Transcripts and summaries 
of illegally tape-recorded con- 
versations at Democratic Na- 
tional Committee headquarters, 
as well as other incriminating 
evidence, was burned and 
shredded. And, of course, there 
was the erasure of 18V5 minutes 
of a subpoenaed tape recording 
of a conversation between Pres- 
ident Nixon and Mr. Haldeman 
three days after the break-in. 

Finally, Mr. Nixon’s men- 
dacity was dramatically exposed 
by his own words on other White 
House tape recordings, which 
provided irrefutable proof that 
be bad lied repeatedly bo the 
American people about his in- 
volvement in Watergate. 

Today a number of factors 
combine to produce a political 
climate skewed by a lack of 
proportionality. Despite the ab- 
sence of any credible allegation 
of misuse of presidential power 
in any way remotely resembling 
that of Watergate, we have a 
Congress prone to making blun- 
derbuss demands for whole cat- 
egories of White House doc- 
uments, relevant or not. 

Mr. Nixon's explicit tape-re- 
corded order to "stonewall" 
has helped create an environ- 
ment in which there is always a 
suspicion that the president is 
not being forthcoming — no 
matter how onerous, invasive or 
novel the demand for informa- 
tion. This dragnet approach, 
now routinely applied, was nev- 
er attempted in Watergate, nor 
would it have been counten- 
anced by the coarts. 

This lack of proportionality 
seems to infuse the press, too. 
Whether it is the creeping 
tabioidization of America, or 
changes in the economics of the 
news business or simply an in- 
stinct for pack journalism, there 
appears to be a decline in crit- 
ical judgment used to evaluate 

the importance of a story. 

• Rather than seeing the media 
as pro-conservative or pro-lib- 
eral. pro-Republican or pro- 
Democrat, I see today's jour- 
nalists as profoundly and un- 
critically pro-scandal. 

The use of congressional 
committees and independent 
counsels to conduct investiga- 
tions of the executive branch 
has its evolutionary basis in 
Watergate, but with a crucial 
difference. The Watergate wan- 
nabes and political revisionists 
who labor to equate Whitewaier 
with Watergate miss the fun- 
damental point of both affairs. 

The abuse of presidential 
power so central to the Water- 
gate scandal, and which truly 
threatened our civil liberties, is 
nowhere to be found after four 
years of investigating die Clin- 
tons. Watergate was about what 
Mr. Nixon did to the presidency: 
Whitewaier is about a failed land 
venture that went south before 
Bill Clinton was even elected. 

There is, however, one en- 
during strain of political virus 
whose recent outbreak is remin- 
iscent of Watergate: the cor- 
rosive effect of raising ever- 
increasing amounts of money to 
fund political campaigns. 

The post- Watergate laws re- 
forming campaign financing 
were long ago evaded by cre- 
ative minds seeking loopholes 
and competitive advantage. 
Clearly, there have been abuses 
by both parties. But unless there 
is a genuine legislative agenda 
to reduce die demand for these 
enormous sums of money, the 
public may regard the upcom- 
ing hearings on campaign fi- 
nance as just another round of 
partisan mudslinging. rather 
than a true effort at-reform. 

Let us use the memory of 
Watergate to roll up our sleeves 
and do the work necessary to fix 
what is so clearly broken. 

The writer was chief of r /re 
Watergate Task Force of the Wa- 
tergate Special Prosecutor 's of- 
fice. He contributed this com- 
ment to The Washington Post. 

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1897: Taking Hawaii 

WASHINGTON — Hawaiian 
annexation was discussed at 
length at the Cabinet meeting 
today [June 15]. The result was 
that the president approved the 
draft of an annexation treaty 
which has been negotiated by 
Assistant-Secretary Day and 
Minister Hatch. In all proba- 
bility the instrument will be 
signed by Secretary Sherman 
and Minister Hatch tomorrow. 
If ihis is done the treaty will be 
transmitted to the Senate for its 
action without delay. 

for a set. to be installed in hi* 
home in England. 

1947: Soviet Reaction 

1922: A Psychic Aid 

ATLANTIC CnY ~ After at- 
tending and participating in a 
wireless broadcasting demon- 
stration here yesterday [June 
15], Sir Arthur Conan Doyle an- 
nounced that he was convinced 
that wireless would greatly aid 
all psychic investigations in fu- 
ture and that he had given orders 

LONDON — Great Britain's 
Ambassador to Moscow was it)' 
strutted today [June 16] to seek 
Soviet views mi the Marshall 
plan for preparation of a Euro-' 
pean economic recovery pro- 
gram to be backed by the United ’ 

States. At die same time., 
however, foe American propos- 
al was attacked by the Moscow 
newspaper "Pravda” as r 

terference in foe domestic af-J 
fairs of ofoer countries.’-’ Th® • - 

denunciation of foe American J 
proposal from "Pravda” todays JpsJ. „ 
was foe first reaction of any] 
kind from Moscow since .Me i 
M arshall's offer in a speech atj 
Harvard University ten days ; 
ago. While not unexpected. * 
nevertheless the "Pravda” ar-, 
tide did strike observers here as j 
somewhat less outspoken than ; 
had been anticipate 


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& Adultery and Fraternization: Who’s What 


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By William S afire ™ ? ^ anu ^ y ■ Offspring from adulterous 

unions were called adulterini." 

VJASM NGTON-Ev^yscoda. nx^' 

lJSvRW A^Fn^fi U ?r er ti? >0d “ some cour ls bold that the unmanned 
K - eU 2L?f2i sl? lieute ^ n ^ participant is not guilty of adultery (that 

pioneer female B-52 pilot, accused of only the married rarticioant is\ bit oth- 
riuliery and its joventp. ‘‘How can ei/ hold^T BRSSmZ « 

ask£d ^ adulterers." The Armed ServiSvlanu- 
colleague. She s single. The married al for Courts Martial Article 134 “ Adul - 

»* m m thatShaso^d^ 

. .. * " , tuwinu iv OVUKMIC CIW. 

te f are ' 2? ,^ rora w 80111 participants in an adulterous 

VtS ?' Ot S not the root of relationship have come to be under- 

P 051 X?- 5100(1 35 “gagkg in fldufrerv. ho mat- 
ticiple of adolescere, to grow up.") ter which one is married. 

the word is poetically defined bv 

nEri vu ^ uy *»u wiwi: ■ u uiu«c on: uewenani 

^^2 a00n of ^ mama fi e Flhm was also charged with fratem- 
bed. ■ Other dictionaries use variations ization. Coined in 161 1, the verts frat- 
of -voluntary sexual intercourse be- errdze meant “to agree as brothers” 
tween a married person and someone 
not bis or her spouse.” In general 

speech, adultery is “an extramarital Some Courts hold that 
affair” or, more informally, “Dlavin* »i_ . , 

around.” the unmarried 

‘ “Whosoever Jooketh on a woman to participant is not ffUllty 
lust after her hath committed adul- * - j o v 

terie," reads a 1590 translation of Mat- ©I adultery. 

th'ew 5:28. But the act lost its male — — 

identity and was dramatized by Nath- from the Latin fiaier. “brother.” In 

hhiaI UflVlrtllAMA id lOCn 1 T. ■ > « MB. . ■* _ 

;row up.") ter which one is married, 
ir defined by All clear? To move on: Lieutenant 
the marriage Flinn was also charged with jh item- 
's* variations ization. Coined in 1 6 1 1 , the verb frar- 
crcourse be- erruze meant “to agree as brothers,” 

Some courts hold that 
the unmarried 
participant is not guihy 
of adultery. 

aniel Hawthorne in his 1850 novel 
“The Scarlet Letter"; the “A” for 
adultery was "embroidered and illu- 
minated^ " on Hester Piynne's bosom as 
a punishment. 

Under most religious law, the mar . 

Italy in 1851, the noun was pejorative: 
“a fraternization . . . with the dreaded 
foreign soldiery." Butin 1897, George 
Bernard Shaw saw it as a verb of peace: 
“The whole army might . . . realize that 
they had no quarrel with die enemy and 

ried participant is an adulterer and the fraternize with them.” 
single one merely & fornicator. Under During the occupation of Germany 
the old common-law rule, however, after World War if, as the Cold War 
“both participants commit adultery if with the Soviet Union began, the U.S. 
the married nnrtirmint it a nwinun ’ * miliiom 4 : .j 

the married participant is a woman,’ * 
Bryan Gamer, editor of Black’s Law 
Dictionary, tells me. “But if the wom- 
an is the unmarried one, both par- 
ticipants are fornicators, not adulter- 

**r-r " CjiAme nnfaie- ttfiktr 1 ) 1 ‘TUI** 

military and the diplomatic corps issued 
regulations against fraternization with 
“locals” of the opposite sex. There was 
to be no "“sleeping with the enemy." 

In today's sexually integrated armed 

ers.' Seems unfair, why? * ‘This rule is forces, fraternize has developed a new 
premised on whether there is a pos- sense. Here's the Ait Force regulation: 
sibility of adulterating the blood with- “Unprofessional relationships, espe- 

cially fraternization, erode good order, 
discipline, respect for authority,” etc. 

The linguistic problem, long ig- 
nored, presses upon us: can women 
engage in fraternization, either with 
men or with each other? Will the armed 
services have to amend their manuals 
to reflect fraternization or sororisa- 
tion? The gender-language police are 
letting down the side. 

“Prime Minister Blair proposes a 
need less white paper on a freedom of 
information measure,” noted a New 
York Times editorial about Tony 
Blair’s fast start in office. “This step 
only invites long delay and bureau- 
cratic scuppering." 

The noun scupper, from the La tin 
exspuere, “spit out," is. as old salts 
know, an opening on a ship's side to let 
water and refuse run out. In the mid- 
20th century, scupper became British 
underworld slang for “prostitute." 

Blind alley. Try the verb, which first 
appeared in 1885 to describe the mas- 
sacre by the. Sudanese Mahdi of British 
and Egyptian expeditions led by Gen- 
eral George Gordon. The Pall Mall 
Gazette wrote of “the fierce warriors 
who scupper Tommy Atkins within the 
lines of Suakih." 

From that horrific meaning of “sur- 
prised and destroyed,” scupper cooled 
down to "defeat, ruin.” and in 1957 the 
Economist wrote of “searet rejoicing 
in Whitehall if the French Assembly 
had scuppered the common market” 

Thus, the New York Times' use of 
“bureaucratic scuppering which 
might have come from a ship’s waste 
chute, is more likely derived from the 
killing of "Chinese" Gordon (named 
for crushing the Taiping rebellion of 
1 863-64) and his compatriots. Historic 
color abounds when we stop to ex- 
amine on unfamiliar word. 

New York Tunes Sen-ice 

Israeli Court Ends Netanyahu Case 

But Leader Drops Planned Trip to U.S. 



Scenes From My Life With 
Norman Mailer • 

By Adele Mailer. 380 pages. $25 W. 

Reviewed by Bruce Cook 

I TS difficult to know quite how to 
approach a book like this. When an 
ex-wife, ex-mistress, sometimes even a 
widow, writes a book about her former 
partner, it is often done to give vent to 
stored anger; Claire Bloom provided a 
prime expnple recently in her report on 
her married life with Philip Roth. 

Occasionally, however, there are sur- 
prises. When Joyce’ Johnson, an ex-girl- 
friend of Jack Kerouac, published 
“Minor Characters,” nobody expected 
much. What we got was a beautifully 
written piece of work that is wonderfully 
evocative of Kerouac and the entire peri- 
od. - 

■ “The Last Party” does not begin to 
approach the standard set by “Minor 
Characters." Johnson had at least a nov- 
el or two behind hex and years of ex- 
perience as a book editor when she wrote 
her memoir. Adele Mailer is, or was, a 

painter and an actress. Evidently the 
only writing she had done previously 
was of a one-woman show about her 
family, which she expanded to include 
ho- life with Norman Mailer from 1951 
to 1962; the book at hand evolved from 

Her years with Mailer were tough 
ones for Him, professionally. When they 
met be was coining off his failed first 
marriage, yet still riding high on the huge 
success of his first novel “The Naked 
and the Dead.” His second novel, “Bar- 
bary Shore,’ ’ was trounced by the critics 
when it came out in 1952. His third, 
“The Deer Park,” was rejected by the 
publisher who had contracted for it when 
Mailer refused to rewrite or remove a 
passage deemed pornographic; when at 
last it was brought out by a more daring 
publisher in 1955, it received more bad 
reviews than good. He would not attempt 
another full-length work of fiction for 10 
years. How did Mailer, the man, hold urp 
during these difficulties? That is the sub- 
ject of this book, and the answer is, alas, 
not at all welL 

Right from the beginning, according 
to Adele Mailer, he wanted, then 
needed, to be die center of attention. 


By Alan Tmscott 

T HE top-seeded team led 
by Seymon Deutsch of 
Laredo, Texas, won an un- 
expectedly easy victory in the 

final of the international tram 
trials in New Orleans, re- 
cently. He and his teammates, 
Zia Mahmood of Manhattan, 
Michael Rosenberg of Tucka- 
boe. New Yak, Chip Martel 
of Davis, California, and Lew 
Stansby of Castro Valley, 
California, will be one of the 
two teams representing the 
United States at the world 
championships in October in 

On- the - diagramed deal 
from the main final both 
North-South pairs reached 
four hearts. Jeff Meckstroth, 
of Tampa, Florida, followed 

the sequence shown, while 
Stansby bid three hearts at his 
second turn and continued to 
four hearts when his partner 
bid three no-trump. In each 
case, the opening lead was the 
singleton . diamond ten, 
covered with the jack, queen 
and ace. Both South players 
led the chib king, and both 
West players made the right 
decision by holding up the ace 
and then winning the - next 
club lead. 

Both West players knew 
from the bidding mat the de- 
clarer was void in spades. 
Against Stansby, West made 
it easy by leading the ace and 
another heart. South was able 
to draw trumps and lose two 
diamond tricks, m a k ing his 

Rosenberg as West did bet- 
ter by returning a club, know- 

ing that his partner would be 
able to ruff. Zia ruffed 
dummy’s club ten with the 
heart queen, which South 
overruffed with the king. 
Meckstroth ’s -legitimate play 
at this point was to lead the 
heart jack, hoping to pin the 
ten. Instead he tried for a 
swindle by leading the heart 

Rosenberg paused. If he 
played low and his partner 
could not win, he would be 
endplayed by the next trump 
lead, forced to give South an 
entry to the dummy. He then 
made the winning play of a 
low heart, letting his partner 
win the 10 and so defeat the 
game, gaining 12 imps. He 
reasoned, rightly, that Zia 
would not have ruffed with 
the queen a trick earlier unless 
he held another honor. 



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By Serge Schmemuim 

Netc York Tunes Sem, r 

JERUSALEM — The Israeli Su- 
preme Coun on Sunday upheld the de- 
cision of the attorney general not to 
prosecute Prime Minister Benjamin Net- 
anyahu or his justice minister in an in- 
fluence-peddling case, lifting one bur- 
den from the embattled government. 

But the threat of a major confrontation 
with American Jews over conversion, 
plus the increasingly tense impasse in 
the Palestinian talks and a new rebellion 
within his coalition, compelled Mr. Net- 
anyahu to cancel a planned trip to the 
United States. 

The Supreme Court’s decision effec- 
tively put an end to the political fallout 
from the six-month-old "Bar-On Af- 
fair,” which developed from allegations 
that the prime minister had appointed a 
lawyer named Roni Bar-On as attorney 
general under pressure from a powerful 
politician seeking to gain respite from 
his own legal problems. Mr. Bar-On 
resigned after less than a day. 

After a long, intensely followed in- 
vestigation, Attorney General Eliakim 
Rubinstein concluded in March that he 
had insufficient evidence to indict either 
Mr. Netanyahu or Justice Minister Tzahi 
Hanegbi, though he did recommend 
‘ charges against the politician, Arieh 
Deri of the religious Shas party. 

By a 4-to-l decision, the Supreme 
Court rejected petitions demanding that 
Mr. Netanyahu and Mr. Hanegbi be in- 
dicted. The majority ruled that court 
does not intervene in the attorney gen- 
eral's decisions unless they are "ex- 
tremely unreasonable." The fifth judge. 

Dalia Domer. said she had sought an 
injunction ordering the stale attorneys io 
show cause for their decision not to 
Indici Mr. Netanyahu. 

“This affair is behind us,” Mr. Nei- 
anyahu declared. "I intend to move for- 
ward and to deal now with the problems 
connected to achieving peace and se- 
curity and economic prosperity for the 
stale of Israel.” 

Before that, however. Mr. Netanyahu 
faced what was shaping up to be a bitter 
showdown with American Jews over a 
law proposed by ultra-Onhodox Jews in 
Israel that would declare only those con- 
versions performed in Israel by Orthodox 
rabbis to be valid. The law has already 
passed the First of three readings in Par- 
liament, and is expected to be brought 
back before the end of the month. 

It is this crisis that evidently led Mr. 
Netanyahu to cancel a trip to the United 
States for the International Conference 
for the Environment. 

Though the law effectively confirms 
the unofficial status quo. Reform and 
Conservative Jews in the United States 

— about 84 percent of American Jews 

— view the legislation as a humiliating 
attempt to relegate them to second-class 
status within Judaism, and they have 
responded with fury. 

According to Israeli press reports. 
American Jewish donations to Israeli 
recipients — about $230 million a year 
in the past — are down by 10 percent. 
Defense Minister Yitzhak -Mordechui. 
who is on a tour of the United States, was 
quoted as being surprised at the depth of 
rage and humiliation he encountered. 

According to ultra-Onhodox politi- 
cians, the conversion bill was prompted 

II»4jI( irt.iiV.nJ.1- 

Prime Minister Netanyahu arriving * 
at his office after the court ruling. 

by a suit filed by Conservative Jews in ^ 
Israel asking that the Interior Ministry ■ 
recognize their conversions. The Interior 
Ministry is involved because conversion 
to Judaism opens the door to Israeli ; 
citizenship under the Law of Return. , 

For Mr. Netanyahu, the choice is bit- ' 
ter. If he blocks the bill the religious 
parties could bring down his govern- 
ment. If he supports it. he risks a serious ’ 
rift with American Jews. 

Another factor that evidently pronip- ", 
ted Mr. Netanyahu to forgo the "trip to the _ 
United States was a worsening of the'* 
situation with the Palestinians. Efforts 
by Egypt to mediate a return to ne- * 
got i aliens have so far shown no results, 
and a new wave of violence has erupted '• 
in Gaza and Hebron. ’ 

IRELAND: A Tide of Immigration Starts to Move the Other Way 

admired for his talent and bold ideas. 
Thai meant an endless routine of party- 
going — invitations were always forth- 
coming — and party-giving, which in 
turn meant lots of drinking (often with 
disastrous results detailed in the book) 
and lots of pot smoking, too (with even 
more disastrous results). Back in die 
’50s, Norman and Adele Mailer were 
out there on the very cutting edge of 
being naughty. They stripped at parties, 
tried wife-swapping — though Norman 
didn't like it much when he would look 
over and find Adele in the arms of an- 
other man — even paid to be entertained 
with a sexual exhibition down in Mex- 

She seems to have matched him drink 
for drink and toke for toke at those 
parties. Indeed, though she dearly 
blames her husband for it, she is quite 
frank about her own downfall. Never 
once, she says, did it occur to her that she 
might be an alcoholic; now, presumably, 
it has occurred to her, and die has done 
something about it 

Bruce Cook, the author cf a number of 
books, including “The Beat Generation." 
wrote this for The Washington Post. 

Continued from Page 1 

escaped and went to Senegal.” 

He said he had entered Ireland with a 
false passport, paying $5,000 for it to a 
trafficker who flew with him to Dublin. 

Few of the African refugees get such 
personal service from their traffickers, 
who sometimes pack them in ferries in 
Wales or hide them in other boats, across 
the Irish Sea from Dublin, and tell them 
they are going to Canada. 

Mr. Brahim-vell said he was being 
treated for hepatitis, receives about $ 1 40 
a week from the government and lives in 
a single room in an apartment building 
with many Irish students. 

He has witnessed no racism, he said, 
as say most refugees, reluctant to com- 
plain in the country that will decide to 
keep them or send them away. 

A woman just arrived from Kinshasa 
in Congo calmed her three small daugh- 
ters in the council office as she awaited 
the help of a translator who spoke her 
native Lingala. She said in broken 
French that she was a political refugee, 
fleeing the new government in her coun- 

Two young Russian men in the office 
said they needed help, that no one would 
hire them because they had heavy ac- 
cents and looked foreign. 

Once the government catches tip with 
the backlog, the woman would seem to 
have a chance to gain asylum; the Rus- 
sians will probably be sent home. 

Most of the 1.300 refugees who ar- 
rived this year are from Romania, some 
poor Gypsies, some middle-class polit- 
ical dissenters. The refugees who get 
into Dublin, most using forged pass- 
ports. are housed in working-class areas 
of central Dublin and given about the 
same amount of money as unemployed 
Irish receive - — $100 a week, which is 
below the national poverty line. 

It is illegal for the refugees to work. 
Some of the Romanians beg on the 
street, and some have been accused of 
shoplifting by merchants. 

Last week, two Romanians seeking 
political asylum were convicted of as- 
saulting an Irish man and given sus- 
pended sentences. 

Also Iasi week, a Romanian man who 
was denied asylum after an investigation 
punched police officers as they tried to 
put him on an airliner. The crew of the 
Aer Lingus plane then refused to take 
him. and he was shipped to Wales tn a 
feny. The incidents received wide pub- 
licity in newspapers and on television. 

The vast majority of the refugees, 
from Romania and elsewhere, have ap- 
plied for political asylum, and the back- 
log of unprocessed cases has been build- 
ing for years. Parliament, in keeping 
with United Nations agreements, passed 
a new Refugee Act in December. 

But the law cannot be put into effect 
until the government produces the new 
regulations, which the Justice Department 
said would happen in a matter of weeks. 

It is the Romanians, especially the 
Gypsies, who arouse the most animosity 
here. A taxi driver pointed out a middle- . 
aged man walking along die River Lif- ; 
fey, not far from the Council office. 

"1 saw that fellow an hour ago, beg- 
ging.” he said. "He had only one leg at 
the time. He said he was a' Romanian 
refugee. Now 1 see he has two legs. , 
That's the way they are.” 

African immigrants have also been . 
the targets of racism. 

"We're 99 percent white," said Cath- 
erine Winston, the administrator of the 
council "It's a culture shock for our t 
people. We have to get used to it. " 

She said racism directed at the new 
refugees was a small, but painfully no- 
ticeable, part of the problem. Racist slo- 
gans are painted on walls in areas where 
the refugees live, and were regularly, 
painted on the Council’s front door on ; 
Aran Quay on the Liffey. 

Demire Clancy, in charge of the 
Council’s legal work, said: "It’s quite , 
ironic that Ireland is a country that has , 
sent iLs citizens abroad for a variety of j 
reasons and should now have difficulty 
accepting a small number of refugees 
who seek protection from the violation ’ 
of their rights. 

"And just last week,” she continued, | 
"we were commemorating the 1 840s ; 
famine, that sent millions of our people ^ 
to America and other places, and Pres- 
ident Clinton said how generous and 
giving the Irish people are." 

VERDICT: Bombing Trial Gives ‘Closure’ But Questions Remain > 


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West led the tfiamood tea. 

Continued from Page 1 

any new leads they may come across. 

The coming trial of Mr. Nichols may 
.shed light on some of these issues, par- 
ticularly if his lawyers are given wide 
latitude in presenting evidence. No date 
has been set for that trial, but it is ex- 
pected to begin this summer or early in 
the fall. 

In the trial of Mr. McVeigh, Mr. 
Hartzler confronted the possibility that 
there might be others involved. 

Someone may have accompanied Mr, 
McVeigh to the rental outlet in Junction 
City, Kansas, where Mr. McVeigh used 
the name “Robert Kling" to lease the 
large Ryder truck that carried the bomb, 
Mr. Hartzler said. All three employees 
who were working in the rental office 
that day remembered that there were two 

But Tom Kessinger, the mechanic 
who bad the most detailed recollection 
of the men, was not called as a pros- 

ecution witness in the trial of Mr. Mc- 
Veigh because the government did not 
want to muddy the waters. The defense 
did not call him because he identified 
Mr. McVeigh. 

Mr. Kessinger' s original description 
to an FBI sketch artist of the square- 
jawed man who come to be known as 
John Doe No. 2 turned out to be a 
description of a man who had come into 
the shop the next day and who had 
nothing to do with the bombing. 

A man who called himself " Kling” 
ordered Chinese food delivered to Mr. 
McVeigh's room at the Dreamland 
Motel in Junction City late in the af- 
ternoon the Saturday before the bomb- 
ing. But Jeff Davis, the man who de- 
livered the food, swore he had given it to 
someone who was not Mr. McVeigh. 

In a letter written from Arizona two 
months before the bombing and intro- 
duced at the trial, Mr. McVeigh seemed 
to be telling a Michigan woman that he 
was not alone. 

“Most of the people sent my way 
these days are of the direct -act ion type," 
he wrote, "and my whole mindset has 1 
shifted, from intellectual to animal-." 

In pretrial hearings, one witness said 
he recalled two men who purchased the 
fertilizer used to make the bomb. AI-, 
though one might have been Mr. Nich- ! 
ols. he said, the other man was not Mr. 

That testimony came from Frederick 
Schleoder Jr., who works at the farmers’ 
cooperative in McPherson, Kansas, 
where the fertilizer was purchased; he 
was not called as a witness at the trial. 
Instead, a senior cooperative official at- 
tested to the authenticity of a receipt, 
which was found in the home of Mr. 
Nichols and bore the fingerprints of Mr. 

Mr. Schlender said he had loaded the 
fertilizer onto a trailer pulled by a pickup 
truck driven by the men. But the pickup 
truck he described was larger than Mr. 
Nichols's truck. 

CLINTON: Affirmative Action 

GNew York Tbnea/Ediled by WiU Short*. 

Continued from Page 1 

and see that this year of hon- 
est dialogue and concerted ac- 
tion helped to lift the heavy 
burden of race from our chil- 
dren’s future, we will have 
given a precious gift to Amer- 
ica,” Mr. Clinton said. 

He called on the country to 
do this now, “when we are 
not driven to it by some emer- 
gency or social cataclysm.” 

“Honest dialogue will not 
be easy at first,” Mr. Clinton 
said. “We’ll all .have to get 
past defensiveness and fear 
and political correctness and 
other barriers to honesty. 
■ Emotions may be rubbed raw, 
but we must begin. " 

The president also pointed 
-to the drawbacks of abolish- 
ing affirmative action in edu- 
cation. He said the repeal of 
. such programs in Texas and 
California had . prompted 
minority enrollments in state 
law schools and other gfadu- 
: ate programs to drop for the 
first time in decades. 

“If we close tbe door on 
them, we will weaken our 

greatest universities, and it 
will be more difficult to build 
the society we need in tbe 2 1st 
■ century," Mr. Clinton said. 

Last year, the 5th U.S. Cir- 
cuit Court of Appeals, cov- 
ering Texas. Louisiana and 
Mississippi said public uni- 
versities may not consider a 
student's race as a factor in 
admissions. The Supreme 
Court refused to hear an ap- 
peal by tbe University of 
Texas, leaving the appeals 
court ruling in place. That set 
off a chain reaction in which 
applications by members of 
minority groups plummeted 
at the law school Ten black 
students, compared with 65 
last year, have been admitted 
for the term beginning this 

Nonetheless, while recent 
Supreme Court rulings por- 
tend a shift away from all 
affirmative action, the 
justices still make an excep- 
tion for education, saying that 
the value of racial diversity in 
that field just ifies special pro- 
grams to increase minority- 
group representation. 



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PAGE 10 


•# s 


S +44 171 4200348 


M > 

The International Federation of Red Cross and Red Crescent Societies 

is seeking to Jill the position of 


Based in Geneva, the incumbent will be responsible for providing technical support to Red 
Cross and Red Crescent National Societies and the Federation Delegations around file world 
in planning, implementing, monitoring and evaluating Community Health programmes. 
Responsabilities include: proposing appropriate policies and developing guidelines for 
Federation Community Health Programmes: identifying the existing capacities of National 
Societies and areas for improvements with respect to Comm unity Health development; main- 
taining regular contact with relevant inter-governmental and non-governmental agencies and 
engaging in fund raising activities. 

Applicants must have a University Degree in Medicine and a post-graduate degree in either 
Public Health. Community Health or Family Medicine. At. least 5 years of relevant interna- 
tional work experience is also required. Good verbal/wri ting skills in English are essential 
and a working knowledge of French. Arabic or Spanish would be an asset. Candidates must 
be available to travel. 

The International Federation is an equal opportunity employer. Applicants should send their 
curriculum vitae quoting vacancy number 97-127 no later than July IS. 1997 to: 

Head of Recruitment and Human Resources Planning. 
Human Resources Department, 

International Federation of Red Cross & Red Crescent Societies. 
RO. Box 372. CH-121 1 Geneva 19. Switzerland. 
FAX:(4IK22)733 17 27. 

Career opportamties ■ General Management 

Our client; a successful European corporation and 
market leader in its field, with sales exceeding 3 bio. 
US$, wishes to strengthen its global business 
organization. Excellent career opportunities have 
been created in Marketing and Sales, that will lead 
to General Management positions within the next 
2-3 years. For these international assignments we 

plus MBA or in Business Administration, with 
professional experience in the fields of durable 
consumer goods or industrial products. We are 
looking for ambitious individuals, ready to make a 
decisive career move, who have an international 
orientation and an excellent track record in business 

development, marketing or sales. Scope and 
potential of the vacant positions demand perso- 

potential of the vacant positions demand perso- 
nalities with management calibre, superior 
analytical skills and a proven record of achieve- 
ments. Languages: English, any additional 
European language is an asset For a first contact, 
please send or fax your CV in confidence to the 
appointed Executive Search firm: Perma 
CTonsultants Inc., P.O. Box 1304, 8032 Zurich, 
Switzerland; Tel +41-1-3889010; Fax +41-1-3889011; 

Atmtntson JE 5 FL TTej^sers 

Ear information regardmgeor 19^47 . 

“Newspaper in the QassrooaT materials pEnSe: contact 

Emeue Leveal - 

Educational Services Department 

181 Avenue Qtarierde-Guille - 9SS2I Nemi 
TeL: 33 1414394 39 - fo:3S14l 

Cedex - Ffemce 


for CEO/Chairman of the Board 
Location: Seoul. Korea. 

Qualified female candidate will: 

• Have sound Executive Secretariat skills 

• Be fluent in English and Spanish 

• Be familiar with VIP travel arrangements 

• Preferably have an advanced degree 
■ Be able to travel internationally 

• Have excellent communication & organizational shills 

• Must be detail-oriented 

• Preferably be between 28 and 38 years 

• 4-5 years similar experience 

An excellent opportunity tor qualified parson to fill a satisfying and 
rewarding independent role with excellent compensation. 

For interview send resume with photo to. 

CHM International 

Attn: Eric R. Eltner. R.R. 1. Box 338. Hayworth. Illinois 61745 USA. 
Fax: 309 8281190 


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. American Financial Service Company 

based in Parts searching for candidates for the position of 

Business Development Manager, MEA 

The canrfdate wfll be sales and martetng orientated, a self starter 
with a wsl developed business acumen. The positron is responsftfe for 
developing agent accoirts and volume, asssing direct sefina 
preparing and delKremg sates preserxaions. serving accounts. hiSe- 
mantlng trade shows and semnars. idenWyrog and aduaflsing prioritised 

B«yoa quafcty. providing ongoing competitive assessments. 

daflons/lrjplicajron scenarios lor management evaluation and action as wel 
_ as rewewwig/arHlyang performance and competitive dara. 

The successsful candidate must be fluent to French and Engfah. Arabic 
would be a plus. Must have a 4 year collage degree or higher, age from 
. 25 to 30, possess 2 to 5 years buetoass earanence, hfludnfl some 
rxematianal travel, preferably to Africa or the Middte East, possess strong 
administrative, and commmlcaljon skQs. Bo a cSizeri of tna EEC. know 
Wtodows 95. Word. Exeat, Powerpoirt. 

Please respond by letter or fax to: 

WESTERN UNION FS»: 33 Avenue Wayam, 

75017 Paris or Fax: 33 (0) 1 45 72 77 21 

Secretarial Positions Available General Positions Wanted 


Seeks Eng&sti mcnher-iongw secretary 
Spoken and cnflen French necessary 
Good edtfng & corqwer sUs requiai. 
Send CV S photo before 27tti June to. 
Japanese Detegartoa to da OECD, 
General f!Un Section. 

11 Arena Hoehe, 75008 Farts. 


Just ta* from USA. seeks marking 
commercial sb In Pans reason, 
fax 433(011 40 84 39 49 


tor Busness Florae 
Dynamo. FnerxJy Team 
hwaiw Teacfing Nteftes. 
Pans-Slftrts \%rtmg Papers 
Coopt* das Languet(01) 45 61 S3 56 


HELP WANTED. Pan-lime Secretary. 
Engesh mother longue, nonsmoier. fen- 

Educational Positions Available 

bie hours Musi have noridng papers. 
Please rnne to Bon 317. HT. 92521 

Please mite to Box 317. 

SECRETARY. Paris 16m. Engfeh notiar 
krone, navsmcta. Pfease «te » Bn 
314 IHT. 9221 NflMy Cede*. 

PROFESSIONAL En^sfi nnSief tongue 
Turn requred. business backgmund. 
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Yfestml toll 13 rue Tm VNarceau. 
75016 Paris. Tel *33 W 40 B7 74 37 

B8&M8UAL EXPERTS needed, educa- 
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partM-nme. salanetffreeiznce posnasis 
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433 (0)144329310. Tel +33 10144329311 

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Herald Tribune 
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MONDAY, JUNE 16, 1997 

■■ t ..A-** 

PAGE 11 

dom in Hong Kong 

Normal Trade ties Are Crucial, He Says 

bomba UKc+ca 

Celebrating the opening of Hong Kong's convention center, where the handover to China will occur, are, from left, Anson Chan, the chief secretary; 
Tung Chee-hwa, the fciture leader; Victor Fung, chairman of the Trade Development Council, and Sir Donald Tsang, financial secretary. 

Will Daewoo’s Romanian Investment Be a Lemon? 

By Peter S. Green 

International Herald Tribune 

CRAIOVA, Romania — Park Dong 
Kyu has a problem: cars. He has too 
many of them and no place to pat them. 
At last count some 15,000 unsold cars 
filled the back lots, lawns and fields of 
Daewoo’s assembly plant in this flat 
comer of Romanian countryside. 

The reason is fairly simple. Ro- 
mania's economy has yet to recover 
from 40 years of Communist misrule, 
and at about $12^00 apiece, the Dae- 
woo Cielos put together, here from 
Korean-made parts are far too expens- 
ive for a country where salaries average 
less than $100 a month. 

Mr. Park’s parking problem is not 
likely to disappear soon. 

Daewoo Corpus $156 million pur- 
chase of die aging Oltcit car factoiy in 
late 1 994 was just part of a multibiilion 
dollar plan to expand into Europe. Dae- 
woo's goal is to force its way into the 
ranks of the world’s top 10 car makers, 
building 15 million cars annually over- 
seas and I million in Korea. 

New Daewoo plants are operating in 
Uzbekistan, Poland and the Czech Re- 
public, and the company is in talks to 
open plants in Ukraine and Russia. 

For Daewoo, faced with rising labor 
costs at home in South Korea, Eastern 
Europe is a low cost-production plat- 
form where favorable tariff agreements 
open up markets In die wealthy Euro- 
pean Union countries. 

For Romania, selling Oltcit, a failed 
venture with PSA Peugeot Citroen SA, 
to Daewoo was a chance to rebuild the 


domestic automobile industry and earn 
export cash. So far, it has not been, 
working out too well for either side. 

Daewoo Automobile Romania SA 
employs 4,600 former Oltcit workers. 
The Korean company has invested $250 
million in its Romanian operations so 
far, and plans to invest a total of $850 
million by 2000. 

But despite its agreement with the 
R omanian government to produce 
70,000 cars this year, Daewoo sold fewer 

Competition is so tough,, 
the company has no 
room for its unsold cars. 

than 400 autos in Romania in March, and 
will export fewer than 40,000 this year. 

Meanwhile, competition is tough. 
Daewoo has several other car plants in 
the region, and rivals, including Volks- 
wagen AG's Skoda, Italy’s Fiat SpA, 
General Motors Corp.'s Adam Opel 
AG, and Hyundai Corp. of Korea, have 
all opened or plan to open plants in 
Eastern Europe. 

Last year, Daewoo sold 165,000 cars 
across the region, ranking fourth in new 
car sales in Eastern Europe, behind 
A vtovaz, the Russian maker of the Lada 
and Niva; Volkswagen; and Hat. Dae- 
woo has also built an impressive dealer 
network in die region. The British auto- 
industry consultants Harbour Wade 
Brown estimate that Daewoo has 621 
dealers in the region, second only to 
A vtovaz, which has 828 dealers. 

“Daewoo’s plans are too ambi- 
tious,” said Carol Thomas, an analyst 
with LMC, an automotive forecasting 
firm. “Others are setting up in Eastern 
Europe as well. Even though those mar- 
kets will grow, there is no reason to 
believe that Daewoo will sell all the cars 
they say they are going to produce.” 

Mr. Park acknowledges the problem. 
Already -his workers are on reduced 
hours, although still at full pay, and 
workers were furloughed on full pay for 
a week in April. 

.From the point of view of the Ro- 
manian government, which owns 49 
percent of the Daewoo venture, the proj- 
ect has failed to help develop a local auto 
parts industry to supply dial would have 
created new jobs and local profits. 

Mr. Park says 35 percent of the cars 
produced in Romania is now locally 
sourced, but most of that is made at 
Daewoo’s own plant — including 
bumpers, seats, fuel tanks, mufflers and 
suspensions. A $450 million engine and 
transmission shop is now under con- 
struction, and by next year. Mr. Paik 
says it will produce 350,000 units a 
year, most of which will be exported to 
Daewoo factories in Poland and Uzbek- 
istan. Daewoo is obliged to buy 50 
percent of its parts locally within 7 
years, but Mr. Park doubts the company 
can afford to meet die target 

“The whole component industry in 
this country is low grade,” Mr. Park 

“They can supply Dacia, but wecan’t 
use it” he added, referring to Daewoo’s 
local rivaL “If we say, ‘We need this 
component at this price,’ they either 

give up or they ask for more money.” 

That the parts are good enough for 
Dacia is not surprising. Dacia, a one- 
time joint venture with Renault of 
France, turns out a barely updated ver- 
sion of the clunky 1 960s -era Renault 
12 . 

But the Dacia is cheap, about $4,500 
at the current exchange rare, spare parts 
are plentiful, and its no-frills construc- 
tion makes it a hardy vehicle that can 
survive Romania’s potholed roads. 
Daewoo had to redesign the Gielo’s 
suspensions for Romania’s roads. 

When Doina Radu and her husband, 
Mibai, went to buy a new car last month, 
the choice was easy. “Since 1968, Da- 
cia's added one gear to the car, that’s 
all,” Mr. Radu said. “But it would be 
stupid fra: me to buy a good car for 
Romanian roads. With a Dacia, every 
Ro manian can repair the car and die 
spare parts are very cheap.” 

There is a three- to six-month waiting 
list for tire approximately 70,000 cars 
Dacia hopes to turn out this year. 

Analysts at Plan-Econ/DRI say Dacia 
is still the right car for Romania’s market, 
and they do not expect Daewoo to match 

Dacia's domestic sales this century. With . conduct” 

SAN DIEGO — With China poised 
to gain control of Hoag Kong. President 
Bill Clinton has vowed to “keep a close 
watch” over freedom in the territory 
and bas argued that continued U.S. trade 
would keep Beijing in line. . 

“I am convinced the best way to 
promote ouf interests and our values is 
not to shut China oat but to draw China 
in,” the president said in his weekly 
radio address Saturday. 

Mr. Clinton once again said that the 
July 1 transfer of Hong -Kong from 
British to Chinese rule was grounds to 
extend normal trade ties with Beijing. A 
month ago, the president announced 
that he was extending China’s most- 
favored-nation trading status; law- 
makers are expected to vote this month 
on the president's action. . 

Critics of China’s human-rights rec- 
ord are lobbying Congress to cutmormal 
trade relations with Beijing. But Mr. 
Clinton warned bluntly that “no step 
would more clearly harm Hong Kong” 
politically than reversing the course the 
United States has followed for years and 
denying China the same trade privileges 
dial the United States extends to most 
other countries. 

He also said that revoking China's 
trading status once Hong Kong reverts 
to Chinese rule would deal a severe 
economic blow to the colony, elim- 
inating 85,000 jobs these. 

Mr. Clinton noted that Beijing’s 
strongest critics in Hong Kong support 
U-S. - China trade because die colony 
prospers as a conduit for trade between 
the two countries. More than half foe 
goods flowing between the United States 
and China go through Hong Kong. Many 
American businesses prosper too:- More 
than 1,100 American companies operate 
in Hong Kong, be said. 

Making a broader case, the president 
argued that reducing ties to Beijing 
would isolate the Chinese people, derail 
U.S.-Chinese efforts to. combat drug 
trafficking, jeopardize U.S. jobs de- 
pendent on foe emerging market and 
decrease foe incentive for Beijing to 
“abide by the . norms of international 

Romania’s EU entry uncertain, too, Dae- 
woo may find new barriers to its hoped- 
for. Western European markets. 

“If we treat China as our enemy, we 
may create the very outcome we’re try- 
ing to guard against,” he said. “Ex- 

tending normal trading slants is not a 
referendum on China’s policies; it’s a 
vote for America's interests.” 

The legislature hand picked by China 
to rule Hong Kong after the handover, 
meanwhile, voted a package of tough 
restrictions Saturday on demonstrations, 
a ban- on foreign donations for political 
parties and penalties for burning or de- 
facingfoe Chinese flag. (.Page 6) 

Mr. Clinton said human rights ac- 
tivists had “legitimate concerns” but 
argued that editing trade ties “will set 
back those goals, not achieve them.” 

He added that the United States 
would “keep a close watch on the tran- 
sition process and the preservation of 
freedoms that foe people of Hong Kong 
have relied on to build a prosperous, 
dynamic society.” And he promised to 
work with the new Hong Kong gov- 
ernment to “maintain a productive re- 

* ‘China has made important commit- 
ments to maintain Hong Kong's free- 
dom and autonomy, and our nation has a 
strong interest in seeing that these com- 
mitments are kept,” he said. 

(AP, LAT. AFP. Bloomberg) 

■ Chinese Banker Is Optimistic 

.China’s central bank governor lauded 
Hong Kong’s financial and exchange- 
rare policies and predicted that financial 
stability would continue after the tran- 
sition, Bloomberg News reported from 

“We are glad to see Hong Kong's 
financial situation is moving toward a 
smooth transition,” the governor of the 
People's Bank of China, Dai Xianglong. 
said in a Chinese newspaper report. 
“We are confident about financial sta- 
bility after the handover.” 

The People's Bank will not interfere 
with Hong Kong’s monetary system after 
the transfer, he said, and foe Hong Kong 
Monetary Authority, which handles 
Hong Kong's monetary policy, will be 
independent from the People’s Bank. The 
People's Bank also will not set up a 
branch in Hong Kong. Mr. Dai said. 

Relations between Hong Kong and 
China after July 1 are fixed in the Basic 
Law, which says that Hong Kong can 
keep its own currency and financial 
policy management for 50 years. Some 
analysts expect meddling by Beijing. 

Hewlett-Packard’s World Cup Goal 

Olympics, considering these factors: 

• The World Cup will include teams 
from 32 countries, playing 64 matches in 
10 sites throughout France. 

• It is estimated foe aggregate tele- 
vision audience for the matches will total 
37 billion viewers, nearly 6 billion more 
than the total for Atlanta, and that 2.5 
million people will attend the matches. 

Rv Paul Flnren Uiympics, considering these factors: Hewlett-Fade 

in'rrLuJrHeraUTriK'nc , * World Cup will include teams chaUaiges. 

from 32 countries, playing 64 matches in The Won 

L YON — When the world's best 10 sites throughout France. prove bow co 

soccer teams take the field to • It is estimated foe aggregate tele- “Here Hewle 
compete for the World Cup in vision audience for the matches will total they can meet 
1998, the real pressure to per- 37 billion viewers, nearly 6 billion more To do chi 
form may be on Hewlett-Packard Co. The than the total for Atlanta, and that 2.5 provide 75 p 
world's No. 2 computer maker faces foe million people will attend the matches, sands of wo 
same challenge in providing information • Computer systems will need to computers co 
systems for the World Cup as Interna- handle 2. 5 mil lion tickets for 64 matches throughout tin 
tionai Business Machines Corp. faced in 10 locations, as well as maps and Area Netwod 
during the Summer Olympics in Atlanta layouts, office automation, electronic nets and prim 
in 1996. Expectations are high, and, as mail, human resources and volunteers not give an esl 
IBM found out in Atlanta, the price of (around 18,000), results and statistics, foe World Cui 

Hewlett-Packard, hopes to meet the 

“The World Cup is our showcase to 
prove how competent we are,” he said. 
“Here Hewlett-Packard can show how 
they can meet global objectives.” 

To do this, Hewlett-Packard will 
provide 75 products, including thou- 
sands of workstations and notebook 

• Computer systems will need to computers connected to central servers 
handle 2.5 million tickets for 64 matches throughout foe world, hundreds of Local 
in 10 locations, as well as maps and Area Networks and hundreds of scan- 
layouts, office automation, electronic nets and printers. The company would 

failure can be enormous. 

“World Cup 98 will probably be foe 
most extensive organizational use of in- 
formation technology for any previous 

mail, human resources and volunteers not give an estimate of the cost of wiring 
(around 18,000), results and statistics, foe World Cup. 
media information, on-line information For a start, HP has created a Web site 
and sales, drug testing, medical equip- that received around 70,000 hits in its 
mem, and security. 

first two weeks of existence. Mr. Ball 

global event,’ 1 said Phillippe Verveer, a flawless. ’ ’ As IBM discovered when its 

And, as Mr. Lee says, it ail “must be predicts that by the time the World Cup 

pokesman for the French Organization 
jomminee for the World Cup. 

HP is no stranger to big-time sports, giving incorrect statistics and measures 

having provided technical support to 
every Olympiad since 1972, according 
to Lee Ting, Hewlett-Packard's vice 
president and managing director of geo- 
graphic operations. 

In fact, the World Cup may prove to 
be a greater logistics challenge than the 

flawless.” As IBM discovered when its starts on June 10, 1998, the Web sire will at Lombard Odier, which has $1 billion invested in Britain, 
costly computer system failed re- be receiving up to 10 million hits daily. Norwich Union PLC — as the pnblicly traded company 
peatedly daring the Atlanta Olympics, One of the biggest challenges will be will be named — will be among the ranks of foe FT-SE100 
giving incorrect statistics and measures to issue photo identification cards to the Index of leading British companies. The third-largest publicly 
for events, failure can bring endless 50,000 journalists and VIPs who are traded British insurer after Prudential Corp. and Royal & Sun 
mockery and reams of bad press. As its expected to attend the events. The cards Alliance Insurance Group PLC, Norwich Union is likely to 
systems malfunctioned. IBM had to re- are the key to security at foe events and - join the FT-SE 100 Index in September and will be part of foe 
sort to printing out results on paper and contain all the relevant information about FT-SE life Insurance Index. 

faxing them or delivering them by hand foe holder encoded on a magnetic strip. The share sale, announced last year, will make Norwich 
to the press centers. Internet address: Union foe first policyholder-owned life insurer in Britain to 

Nigel Ball, marketing manager at cast off its mutual status and become publicly traded. 

for events, failure can bring endless 
mockery and reams of bad press. As its 
systems malfunctioned. IBM had to re- 
sort to printing out results on paper and 
faxing them or delivering them by hand 
to foe press centers. 

Nigel Ball, marketing manager at 

Norwich Union Stock 
To Get a Strong Start 

Bloomberg News 

LONDON — Norwich Union’s shares were priced at 290 
pence ($4.75) Sunday — the topendoffoe indicative range set 
by foe life insurer : — because of strong demand from poli- 
cyholders and public investors, according to British tele- 

At this price, foe insurer will be valued at £55 billion when 
it begins trading Monday on the London Stock Exchange. 
About four- fifths of foe company’s stock will initially be in 
foe hands of its policyholders, who eagerly bought tip shares 
on a preferential basis at a 25 pence discount, or 265 pence a 

The number of shares sold to the public was pared back in 
foe face of high demand from policyholders. Large corporate 
investors that did not get as much stock as they wanted are 
expected to wade in Monday, driving prices up, as they bay 
shares from policyholders cashing in on short-term gains. 

“There’s obviously, going to be institutional buying to 
support' ' the stock, said Trevor May, an aijalysrar Salomon 
Brothers, who said a fair value for the stock would be 320 to 
340 pence. Although the shares were trading at about 350 
pence in foe so-called gray market of unofficial trading last 
week, Mr. May said the shares would probably be lower 

Investors said that the same scramble to buy the stock as seen 
in other recent sales of financial companies was unlikely. 

“It’s not a must-have share,” said Neil Worsley, a director 
at Lombard Odier, which has $1 billion invested in Britain. 

Norwich Union PLC — as the publicly traded company 
will be named — will be among foe ranks of foe FT-SE 100 
Index of leading British companies. The third-largest publicly 
traded British insurer after Pradential Corp. and Royal & Sun 
Alliance Insurance Group PLC, Norwich Union is likely to 

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The share sale, announced last year, will make Norwich 
Union foe first policyholder-owned life insurer in Britain to 
cast off its mutual status and become publicly traded. 


Canberra Sets ‘Framework 5 for Rate Cut 

Cross Rates £ om. fa un on u=. v* co'^brOvSi&FnmiDiwidn easing credit in July last year, when it 

AgnMdn ism nss5 re* am dim* — s4s' isi3 uw la; 1J3BS’ CANBERRA — The government is was trading at about 79 cents. 

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MntYMkCU — 1SB° USB 5M UfcJH \m USB IMS With 1311 UUK 

SL so* IBB 137» — unr mn aws 4«i un* can is** „ Mr Fischer, leader of the National 

TBk)B hub nun « 2 s ims un an urn 7?js — tots me Party, which is in a conservative co- 

itioaM lwi wav aria aaa asm* ow dj»’ aw* imt — aw* alition government with the Liberal 

T . k tm USB <UJB fljitt MMT 17431 *02* — 12*11? IDA MM* r> ^ -j • , . , . . . 

“ u« ww i«3 tan un* 22 bh Ana issa wjs LMjj usui sjj* m a televised interview that 

i«oft urn e«5i4 13? ixuiMK im am wn lass urn 201719 he would not speculate about whether 

was trading at about 79 cents. 

The interest-rate trend “has been 

Australian dollar. Deputy Prime Min- Mr. Fischer said. It has also led to a more about interest rates, 
ister Tim Fischer said Sunday. realistic value for the Australian dollar. “Thev’ve called 

ployment growth. 

Mr. Howard said be thought the Re- 
serve Bank would be “very sensible” 

Mr. Fischer, leader of the National he added. 

Party, which is in a conservative co- The central bank has eased its key rate “They gotthelastcutrigh't, and I believe 
alition government with the Liberal to 55 percent in four cuts of half a pear- they will get foe next cat or nonmove- 
Party, said in a televised interview that centagp point each, citing high unem- ment right as well" 
he would not speculate about^ whether ployment and low inflation. Mr. Howard was responding to aques- 

foe Reserve Bank of Australia would According to a report released Thnrs- tioh on whether he was worried that die 

again cut its key lending rate. day, unemployment rose unexpectedly Reserve Bank might decide on a rate cut 

But, he said, “What I will say is that to 8.8 percent in May from 8.7 percent that was not warranted after the poor 
we're setting a responsible framework and the economy lost 40,300 jobs, in labor force figures were released last 
for the right kinds of decisions from the contrast with forecasts that it would add week. 

Reserve Bank, because we’ve got the about 12,000. Mr. Howard defended his govera- 

fiscal policy settings right-" Consumer-price inflation, in the meat's economic policy, saying it had 

Mr. Fischer added, “We’re building meantime, was 13 percent in the year ■ put in place a range of measures to 

realistic value for foe Australian dollar, 

“They've called it well, if I may say 
so, over the last few months,” he said. 
“They got the last cut right, and I believe 












































? 8,200 









. m. 


, 58,000 


































T 66 







■’ fer JinttenKriMnagncirnjbH hand <Unry in nia)ar Canon riBaaJ tori 
t* 01 30-84 85 85 er few {069} 9712 6311. 

ran HT Gammy 

aoaogatoAmsierdanUndmMliin.PBrkandZiirkti.fbanesifieititrceriterviVew Mw* foe Reserve Batik Of Australia WOUid 

am/ Toronto rales at* PM 

a: Tabor on* patmti b: To ntiy one OoBan "Units at tut H. 0_- not quoted; NJL: net 

Other Dollar Values 

Cmnacr Pers Cvnwcy Pcrs 
Arattit-PWO OWK CTMkdraC. 274*12 
AnstrafaflS 1.3308 7J435 

Ptfl Omwcf PtrJ Qnaacr Ptri Onrwcy Pvt - **• 

_ _ 05986 274*B MtX.ptM 7.961 S. Air. raid 4.4965 flSCal policy SetUngS right 

tatrofrns I-BOB hmskhs* 7J«5 H.zxdapdt uuo s. to. won was Mr. Fischer added, “We’re building meantime, was 13 percent in the year ■ put in place a range of measures to 
ESEdNSS 2SSS ^3 XSST 5S to a sensible, positive suiphisat foe right that ended March 31. increase growth and employment. 

for the right kinds of decisions from the 
Reserve Bank, because we've got the 


. Mr. Howard defended his govern- 
ment's economic policy, saying it had 

cttMtayuon 8323S imte-repWi 3427JS PoHidoty 123 tmihk 2 *.i 2 time, and that will help provide a lower The government is forecasting that its 

rnituMi 22.23 IrWiI DA582 Part, escudo 17493 Tnrktabfira U37Q5. — ... ... j.c ... r, nr 

QKfinrano 3223 lrish£ D6SB2 
DunHt) know &9HU IVMfiihtfc. 34093 
Egypt, pound 3J9S2 Kn«tu 03079 
Hu. markka 5.1812 Malay, ring. 2JI 

Pert. tscudo 17493 TnrldUifiia >43705. 
ft ass route 57595 UAEdMaai 3575 
Sawfiriyol 3.75 Vw*rbnttr. 48435 
Stog.S 14343 

Forward Rates 

C*m*et *** “«r 9MW 

Pwmrf Stating 1030 1-6318 IZ307 

CmndtandaBar UW 1J753 1.3726 

Mrivftaawrk 1.7270 1700 1.7192 

3Mn (o-aor nan 

Pwnd Stating 14330 15318 14307 Japans* m 113.94 113.45 

CaDctitan defer 1-3785 1-3753 1.3726 Swiss tnrnc 14385 14328 

Dcatsdw nwk 1.7270 17230 1.7192 
Sources ING Bn* (Amstenjam).- mtosutu Bank IBn/ssetst; Banco Commcrdate 
ttatkmo (MB ant! Baim* 0* France | Paris// Bmk of Tokyo AMs obtUH tTotyo} . 

14385 14328 14276 

interest-rate structure. 

The Australian dollar fell to 16- month 
lows last week amid expectations that 
the central bank will ease credit for a 
fifth time in 11 months, with unem- 
ployment remaining stubbornly high 

11345 H2.96 and inflation low. 

underlying deficit will narrow to 3.85 
billion Australian dollars ($2.9 billion) 
in foe year storting July 1 and has 
pledged to return its budget to surplus by 

Meanwhile, Prime Minister John 

He said he believed these measures 
would have a beneficial effect and that . 
next year would see a much stranger ' 
employment situation. ! 

' “The impact of falling interest rates j 
has yet to be felt,”'Mr. Howard said. ' 

Mr. Howard said part of foe problem 

The Australian dollar fell to 75.04 
U.S. cents Friday and has dropped 5 
percent since foe central bank began 

Howard told the Australian Broadcast- with the ciurem low employment growth 
rag Corp. he was happy with the central was foe time lag between cuts in interest 

Vai, I wouW ft* fc> start twmvirtg tie tntemcHonoi Herald Trifune. I/ULO 7 

D M/ dwdi b andosod (payctie la l/» WJ? 

dwgeiiity: □ Anwt □ Oners □ VGA □ Aeons □ MastaCard □ Euraavd 
Cncdb coni dhagv wl In mad* in French FrectfcutMidb. 

G ** 1 Nat- i 1 Exp. Dat« 

Sgnc#u»w_ — - 

F^I»rin«goitWt. inArnteyourVATNo- 

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E-Moil Add ress: 

loot Ififa copy erf fce iff oft! □Inode □ hotel .□ airline Do4w 
U IdotaNwteiwtaBfcrfflsSijii fiwn other canfuBy ulihiik) conpnnx 
Mail mhn Ik Intem^ond Herald 

7SI Am C 4* NmA- C«H fixro ftsc +33 f 41 43 W 10 

OB CAUL +33 J 43 43 93 41 

bank’s handling of monetary policy and rates and a positive response in foe econ- 

expected a pickup in growth in 1998 to 

(Bloomberg. Bridge News). 

OB OUl +33 I 4343 9361 
fa Am +352.39 22 I T BB, In 0te> US (teHrmnk 
f-MaifNof ro t uBgifcoom 
Qfiarvdid for new subserterj oriy. 

1 -800-803-2884 


PAGE 12 



A Fund Chief’s Reluctant Concession: Might as Well Ride the Wild Tape j 

about U.S. equities^ which, as measured Earnings per share forS&Pcoojpames minors the emheU.S.nraAeLj*- ‘XfewA aS mfegrial^j 

levels in comparison with earnings dm erage rose 4.6 pcrcm. Hie Nasdaq -x 

Bloomberg Meti s 

CHICAGO — As the U.S. stock mar- 
ket soars from record to record, John 
Bogle, founder and chairman of Van- 
guard Group, America’s second- largest 
mutual fund company, remains bullish 

— up to a point. 
“You can’t fi 

ou can’t fight the tape, and right 
now the tape is wild," said Mr. Bogle, 
whose fund company manages $280 
billion. But Mr. Bogle, 68. said he 
would not be surprised if the stock mar- 
ket fell as much as 25 percent in the 
short term, though he declined to make 
any specific predictions. 

about U.S. equities, which, as measured 
by the Standard & Poor’s 5 00- stock 
index, have returned 19 percent a year 
since 1992. Last month. Vanguard’s 
chief executive. John Brennan, said re- 
turns for mum al -fund shareholders 
would probably slow in coming years. 

Nervous investors should 
"sell just enough to he 
able to sleep at night. 9 

‘it's not possible to anticipate the 
arkeL” he said. “And even if you get 

market,” he said. “And even if you get 
out at the right time, then you have to 
know when to get back in. My mono is, 
‘Stay the course.’ " 

It's not unusual for Vanguard ex- 
ecutives ro make cautionary comments 

Lately, though, returns have done just 
the opposite. The S&P rose 4 percent 
last week and has gained 34 percent in 
the past year. It rose 9.78 points Friday, 
to a record 893.24. 

“By any measure, the market is ex- 
pensive,” Mr. Bogie said. 

Earnings per share for S&P companies 
rose 15 percent in the first quarter, and 
Mr. Bogle was skeptical dial they would 
continue to grow at dial pace, “Earnings 
rising 14 to 16 percent is what it will take 
to sustain this market,” he said. 

Far the long term, Mr. Bogle is 
bullish. He said an acquaintance re- 
cently asked for advice about how to 
invest a six-figure inheritance. Predict- 
ably, he suggested Vanguard mutual 
funds, but he did not exclusively re- 
commend index funds, which he pi- 
oneered in 1975. An index fund’s choice 
of stocks matches that of a market index 
and mimics its performance. 

Mr. Bogle suggested a mix, with 30 

Most Active International Bonds 

The 250 mosi active international bonds traded 
through the Eurodear system tor the week end- 
ing June 13. Prices suppfied by Tetekurs. 

Rnk Nome Cpn Maturity Price Yield 

Cpn Maturity Price Yield 

Cpn Maturity Price Yield 

Austrian Schilling 

JV| 05/23102 99.4500 4.6500 

Belgian Franc 

238 Belgium ; 

7 worn 106.0000 64000 

British Pound 

194 Denmark 6W 05/22/00 984021 63500 
199 Britain Tsy Loan 914 01/15/99 104.0000 9.1300 
234 Carlton Comm 7Vi 06/06/07 96.0000 7.7BOQ 
243 E I B 74* 12/07/06 101X750 7.4800 

245 Royal Bank Seal 7350009/2603 100.7064 7.7900 
248 EIB 7 Vi 12/07/07 1023000 7.4400 

85 Germany 

86 Treutwrd 

87 Treuhand 

90 Treuhand 

91 Germany 

92 Germany 

93 Germany 
97 Treuhand 

101 Germany 

106 Germany 

107 Germany 
109 Treuhand 
113 Germany 
121 Treuhand 
124 Treuhand 
126 Germany 
131 Germany 
133 Germany 
144 Germany 

147 Germany 

148 Russia 

6V. 07/29/99 

6U 05/13/04 

6 06/20/16 
31ft 12/18/98 
6'A 05/20/99 
54% 09/24/98 
SV 08/20/98 
8 09/22/97 

816 07/20/00 
b't 06/25/98 
7 12/22/97 

« 7 re 12412/98 

5 12/17/98 
7 11/25/99 
64% 01/20/98 
7W 10/20/97 
51% 02/22/99 
VU 10/20/97 
9 03/25/04 

Canadian Dollar 

160 Canada 
1 74 Canada 
21 1 Canadagavt 

7 09/01/01 105.1800 6.&600 
4 0^15/99 99.! 760 4.0300 
51% 09/01/02 98.7952 5.5700 

169 Eksporifin A/s zero 12/17/01 

170 Germany 8ta 05/22/00 

1 75 Germany 6 02/20/98 

184 Germany 5V. 10/20/98 

189 German States 6'4 08/21/06 

191 Bank Trust FRN 3326605/21/02 

Danish Krone 

5 Denmark 
11 Denmark 
19 Denmark 
23 Denmark 
29 Denmark 
34 Denmark 
43 Denmark 
49 Denmark 
51 Denmark 
71 Denmark 
95 Real Kredit 
1 05 Denmark 
110 Denmark 
1 16 Nykredli 3 Cs 
1 72 Denmark 

1 1113600 
! 1123500 

196 Germany 6 is O$20/98 

201 Germany 6% 0621/99 

202 Germany 6 '4 02£CI/98 

209 Germany 8‘'i 07,21/97 

21 B Germany Tbllls zero 07/1 8/97 

219 Bk Fur Arbeit 44* 05/16/01 

220 Guinness FRN 3.164108/28/98 
225 Volkswagen 4.8500 02/28/01 

226 Germany 

227 Germany 
231 Germany 
249 Germany 

7 02/22/99 
5U 11/20/97 
aV< 07/20/98 
6H 02*24/99 

105 3600 

South African Rand 

128Deutsc Fir* Nefh zero 0MJ5/T7 

Spanish Peseta 

114 Spain 
203 Spain 
246 Spain 

Swedish Krona 

99 Sweden 
153 Sweden 
155 Sweden 
162 Sweden 

165 Sweden 1036 101* 

U.S. Dollar 

Dutch Guilder 

Deutsche Mark 

1 Germany 

2 Germany 

3 Germany 

6 Germany 

7 BundesaPlig 

8 Germany 
10 Germany 
14 Treuhand 

16 Germany 

17 Germany 

18 Germany 

20 Germany 

21 Germany 

22 Germany 
24 Germany 
2a Treuhand 

27 Germany 

28 Germany 

30 Germany 

31 Germany 

35 Germany 

36 Germany 

37 Germany 

38 Treuhand 
42 Treuhand 

44 Germany 

45 Germany 

46 Treuhand 

47 Germany 

48 Treuhand 
50 Treuhand 

53 Treuhand 

54 Germany 

56 Germany 

57 Germany 
60 Germany 

62 Germany 

63 Treuhand 

65 Germany 

66 Germany 

67 Germany 

68 Germany 

72 Germany 

73 Treuhand 

74 Treuhand 

78 Germany 

79 Germany 
81 Germany 

83 Germany 

84 Germany 

6 01/04/07 
B 01/21/02 
3 Vi 03/19/99 
6U 04/2606 
4'% 02/22/02 
6 07/04/07 
4V* 11/20,01 
71% 09/09/04 
6 01/05/06 

61% 05/12/05 

6' i 10/14/05 

5 08/20/01 

5 05/21/01 
B'i 09/20/01 
61* 06/1 1X0 
6!i 01/04/24 
71* 01/03/05 
8 Vi 0*20/01 
81% 02/20/01 

6 02/16/06 
5V: 08/22/00 

8 07/22/02 
71k 12/02/02 
61% 07/09/03 
5' » 11/21/00 
6'% 07/15/03 
6'% 04/2*03 
8 7 » 12 / 20/00 
61* 07/01/99 
7'* 01/29/03 

6 11/12/03 

9 01/22/01 
y% 05/15410 

8'% 08/21/00 
5'j 02/21/01 
7ii 10/01.02 
6V. 09/1 5/99 
6 ».j 07/15/04 
6 09/15/03 
7>% 11.T1/04 
61k 04/22.03 
6U 03/04,04 
5V. 04/29/99 
71% 12/20/02 
61% 03/1500 
31% 09/18/98 
7'i 10/21,02 
6'% 01,0209 


























1 07.3300 
1 05.2437 
1 08X133 


52 Netherlands 
59 Netherlands 
69 Netherlands 
76 Netherlands 
80 Netherlands 
103 Netherlands 
120 Netherlands 
127 Netherlands 
129 Netherlands 
140 Netherlands 
1 42 Netherlands 
145 Netherlands 
1 49 Netherlands 
159 Netherlands 
1 63 Netherlands 
168 Netherlands 
1 79 Netherlands 
181 Netherlands 
185 Netherlands 
210 Nelhertands 
215 Netherlands 
223 Nelhertands 
235 Netherlands 

6'« 07/15/98 
9 01/15/01 
5 J i 02/15/07 
71% 06/15/99 
8'% 03/15/01 
5*4 01/15/04 
71% 04/15/10 
B'« 06/15/02 
71% 01/1 5/23 
6 Vi 07/1598 
6»S 1 1.0 5/05 

6 01/15/06 
54 09/15,512 
6'% 04/15/03 

7 V. 01/15/00 

84 09/1 5/07 
7 06/15/05 

7 03/15/99 
84 09/15/01 

8 V, 05/01 >00 
6’* 10/01/98 
8i', 02/15/0 0 
91* 11,3000 
7U 10.01/04 


101 2500 







109 3500 






4 Brazil Cap S.L 4 Mr 04/15/14 
9 Argentina par L 51% 03/31/23 

12 Brazil 10’% 05/15/27 

13 Brazil par 21 5'J 04/15/24 

15 Brazil SZJ FRN 67% 04/15/24 
25 Venezuela FRN 6 v i 1 2/1 8/07 

32 Argentina FRN 6*4 0329/05 

33 Venezuela par A 6W 03/31/20 

39 Mexico 111% 05/15/26 

40 Argentina 111% 01/3W17 

41 Brazil L FRN 6*% 04/15/06 

55ADB 6V. 06/11/07 

58TMCC 7 06/11/07 

81 Brazil FRN «'% 01/01/01 
64 Brazil S.L FRN 6*» 04/15/12 
75 Mexico par B 61, 12/31/19 
77 Mexico par A 6' * 12/31/19 

82 Ecuador FRN 3W 02/28/15 

6'i 12/31/19 
3',i 02/28/15 

94 Mexico A FRN 6X67212/31/19 

70 France OAT 
119 France OAT 
134 France OAT 
156 France BTAN 
167 France OAT 
173 Britain 
186 France OAT 
195 llafy 
242 France OAT 

5to 04,25,07 

6 04/7 5AM 
71% 04/25/05 

5 03/16/99 

7 04/25/06 
91a 02/21/01 
81% 03/15/02 

6 04/02/04 

8'4 . 04/25/22 










96FMCC 7200006/15/07 

98 Moscowdty 9»i 05/31,90 
100 Argentine FRN 61% 03/31/23 
102 Bulgaria FRN 6 Yk 07/28/11 
104 Italy FRN 5.71 88 05/12/92 
108 Venezuela par B 6« QM1/20 
111 Mexico FRN 7*1 08/06/01 
115 Ecuador par 31% m/2B/2S 
122Commerzb FRN 5.726601/29/01 
123 Mexico 111* 09/15/16 

125 Mexico 91% 01,15417 

135*ussla 9* 11/27/01 

136 Hitachi Fin Brit 6V| 08 / 06/00 

137 Argentina FRN 5.6931 04/01,01 

138 Ecuador FRN 61* 02/28/25 

1 39 Brazil S.L FRN 6*Y* 04/154)9 
141 Panama Int Red. 3V% 07/17/14 
1 43 Peru Frt Load. 3U 03*07/1 7 
ltePeruPdl . 4 C3/07/17 
150 Brazil Cbond S.L 41% 0*15/14 
152 Poland Infer 4 1 0/27/1 4 
15J Sadie Mae 41% 0392/99 
158 British Go* Int zero 11/04/21 
161 Landes kas Oeff 6tt 05/21/02 
164 Poland FRN 6«'» 10/27/24 
166 Bulgaria FRN 6** 07/2324 
171 Brazil S.L FRN 6«» 04/15/12 

1 76 Bco Com Exf. 7U 02/0294 

177 British Telecom 6V. 04/2592 
182 World Bank (M 08/2196 

6*i 08/2196 

183 Mexico C FRN 6X20312/31/19 

Finnish Markka 

178 Finland srV»9? 
192 Finland 

11 01,15/99 111.12 9.9000 

9»% 03/1594 120.8516 7.8600 

French Franc 

187 Arg Bontes 

188 Brazil 
190 Brazil 

193 Bayer Landes 
200 Italy 

204 Ecuador FRN 

205 Finland 
207 Ontario 

8 V. 059992 
6 0915/13 
81% 119591 
614 061092 
61% 09/27/23 
3<A 02/2815 
57% 02/7796 
71% 01/2793 

208 Mexico D FRN 12*28/19 

88 France BTAN 

89 FranceOAT 
112 France OAT 
132 France OAT 

212 IADS 
214 Canada 

6*9 039797 
6U 08*2396 

216 Mexico B FRN 6X35912/3119 

1 57 France B. TAN. 4'% 

206 France OAT 
217 France B.T.F. 

224 Frances. TAN. 5'% 

230 France BTAN 

Japanese Yen 

3V. 06,98*05 108.1250 3.4700 

221 Bulgaria 2te 07.7812 

222 Panama FRN 4 071716 

228 Anz Bank Grp zero 01/16/98 

229 Finland 77% 07/2894 

232FMCC 6*1 049390 

236 Banco Do Brasil 8*x 061592 

237 Goldman Sachs O',* 069294 

241 Firs! Uso Credit 5X975021010 
244 Argentina SV* 12/2093 

247 Mexico 9», 02969! 

250 Splalab 67% 047890 

The Week Ahead: World Economic Calendar, June 1 6-20 

4 s&eauto&ma week s economic ana ftiansaf atws comp, ted 'or ,thj Internal, one‘ Herald Tntune Cry Bk-omoorg Business News. 


Expected Brisbane: Conference on working 
This Week with the Native Title Act. Monday to 
Wednesday at the Sheraton Hotel. 
Jakarta: Indonesian Biotechnology 
Conference and Exhibition. Tuesday 
to Thursday. Jakarta Convention 


Amsterdam: European heads of 
government to discuss common cur- 
rency and other topics. 

Paris: The Pans Air Show. Ex- 
hibitors show 200 aircraft, both pro- 
totypes and production models. 


June 16 

Tokyo: Economic Planning Agency 
releases a report on local econo- 
mies. Ministry of International Trade 
and Industry releases revised tig-, 
ures for industrial production for 

Bern: May producer and import 

Moscow: European Union Trade 
Commissioner Sir Leon Brittan 
meets members of the Russian gov- 
ernment to discuss Russia's bid to 
join the World Trade Organization. 

Brasilia, Brazil: PSA Peugeot Cit- 
roen SA is expected to announce 
location of Brazilian car plant. 
Washington: Bretton Woods/Over- 
seas Development Council holds 
meeting. Treasury Secretary Robert 
Rubin speaks about G-7 summit. 

June 17 

Melbourne: Securities Institute of 
Australia holds corporate bnefing. 
Wellington: Retail sales data for 

London: May public sector borrow- 
ing requirement released. 
Stuttgart: The Bundesbank council 
member Hans-Juergen Krupp 
speaks to the public-sector union 
OeTV about the employment ben- 
efits of European monetary union. 

Mexico City: Finance Ministry re- 
leases April industrial production. 
Washington: Labor Department re- 
ports consumer price index for May. 
Commerce reports May housing 
starts: Federal Reserve releases in- 
dustrial production for May. 

Wetaesday Tokyo: Ministry of Finance releases 
June 18 figures on Japan's merchandise 
trade balance tor May; Bank of 
Japan releases May money-supply 

Frankfurt: Bundesbank releases its 
June report. 

London: Office for National Statis- 
tics releases retail sales figures for 

Mexico City: Statistical institute re- 
leases May unemployment rate. 
Washington: Labor Department re- 
ports productivity and costs for the 
first quarter. 

June 19 

Tokyo: Organization for Economic 
Cooperation and Development re- 
leases its biannual report. "OECD 
Economic Outlook." 

Sydney: Government releases May 
merchandise import figures. 

Bern: Swiss National Bank holds 
one of its two annual press con- 
ferences to discuss monetary 

Paris: Final first-half final figures for 
job creation. Prime Minister Lionel 
Jospin delivers speech on his gov- 

Mexico City: Communications and 
Transportation Ministry receives 
bids for a 50-year concession to run 
Mexico's Pacific-North railroad. 
Washington: Commerce Depart- 
ment reports trade balance in goods 
and services for April. 


June 20 

Tokyo: Bank of Japan announces 
its monthly monetary and economic 

Wellington: Preliminary figures for 
housing permits in May. 

emment's policy. 

Copenhagen: May consumer price 

Madrid: March unemployment rate. 
Paris: April industrial production fig- 

Caracas: Weekly international re- 
serves and money-supply figures. 
Washington: Treasury Department 
releases its May budget statement. 

minors the entire U.S. market. Mr. 
BogJe suggested buying the equity 
funds gradually over 12 months. 

As for those already invested, Mr. 
Bogle said small investors who felt un- 
easy at the sight of soaring markets 
should sell shares. But “sell just enough 
to be able to sleep at night,” he said. 

Big-Name Stocks Set the Pace 

percent of the money in municipal-bond 
funds. 35 percent in Vanguard Windsor 

n — a growth and income fund — and 
35 percent in the Vanguard Index Trust 
Total Stock Market Portfolio, which 

The U.S. stock market is going so . 
well that daily records are becoming old 
hat. Bloomberg News reported from 
New York. 

The Dow Jones industrial average set 
a record in each of the past six trading 
days, passing the levels of 7,500, 7,600 
and 7,700 points in rapid succession. 

A half-dozen years into the longest 
bull market in history, die same big-name 
stocks continue to lead the way. Shares of 

at any time in a quarter-century. 

Interest rates are falling, and inflation 
seems a historic novelty. 

“We’re always looking for steady 
growth without inflation, and we’re get- 
ting it," said Lawrence Kamor, a money 
manger at Lexington Funds. “That’s 
great for equities.” 

Investors say there’s no reason to 
think that the party will end soon. There 
seems to be relatively little concern that 
the Dow Jones average will give up any 
of its 22 percent gain since April 1 1. 
Their biggest question seems to be 
which stocks to buy. 

Last week’s rally got a lift from repots 
of declining retail sales and producer 
prices. The data confirmed hopes for a 
slower-growing economy that- would 

erage rose 4.6 percent. The Nasdaq* • « /ufJJil 

Composite Index, home to computer “ 

companies and fledgling businesses, . ' . n .j, I I 
rose 1.3 percent for the week to ckoeac * *.« 9 f 

1/423.04, also a record. ■ . •< 

Yet while bond investors seemed to * ' 
anticipate a slowdown in the economy, •’ 
acock investors were divided The Mor- 
gan Stanley Cyc&al Index — whose 
member stocks tend to perform better » . 
growth accelerates — rose 4.4 peioeatoQ -J 
the week. Bur die Russell 2(XX) index, a > 
broad measure of the health of smaller ’ 
companies, rose a relatively weak JJ 
percent as a spate of profit warnings 
reminded investors that although smaller ' 
companies may grow more rapidly than 
bigger ones, their success is less assured. 

Last month, small stocks as measured by = 
the RussHl 2000 gained 1 1 percent. 

151 Salto Coym FRN zero 181 2/97 100X024 0.0000 
180 Spain 3.1 00009/2096 103X544 2.9900 

213 Bbn Curacao 1400006/11/99 99.7883 1X000 
233 Galois 2»* 061092 99.6500 2.7600 

239 ExImBlc Japan 27% 07/2895 103X500 2-7500 

In Confident Market, Junk Bonds Star 

9X00004/30/99 107X320 8.7500 
7.400007/30/99 104X000 7.0800 
7.900002/28*02 109.2030 7X300 

Bluoniherg News 

NEW YORK — Investors are con- 
tinuing to pour money into junk-bond 
mutual funds, amid confidence that the 
rosy economic outlook means that 
companies with low credit ratings will 
not default on their debts. 

Junk, or high-yield, bonds returned 
0.73 percent last’ week alone, or 46.4 

Western Asset Management in Pas- 
adena. California. 

Hoping to tap into those gains, in- 
dividual Investors and brokers put a net 
$627-6 million into junk-bond funds in 
tiie week that ended Wednesday, ac- 


percent at an annual rate, according to 
data on a basket of 860 bonds tracked by 

01/21/99 109X230 10X600 
04*2099 116X330 7.7400 
04*1292 98X190 5.6000 
10/2596 98.0570 6X300 
0598*00 112.9230 9.0800 
029995 96X570 6X100 

Merrill Lynch & Co. That compares 
with a return of 0.41 percent for Treas- 

with a return of 0.41 percent for Treas- 
ury bonds for the week and 0.56 percent 
for high-grade corporate bonds. 

“WTien you look at high-yield rela- 
tive to other asset classes, it's still at- 
tractive.” said Trudie Whitehead, who 
manages 5500 million of junk bonds at 

cording to AMG Data Services. That was 
the biggest weekly inflow in five weeks. 

Recent data showing that producer 
prices fell for the fifth straight month are 
giving investors more to cheer about. 
With barely any signs of rising inflation, 
the Federal Reserve Board does not have 
a strong case for raising interest rates, 
investors said. 

That is good news for junk bonds 

because higher rates tend to depress 
bond prices and hurt corporate earnings 
by raising borrowing costs. With no ev- 
idence of an economic slump in the 
offing, the junk bond marker is likely to 
keep rising, fond managers and analysts 

“There seems ro be nothing that's 
going to stop it at the moment,” said 
Martin Fridson. a strategist at Merrill 

Many fond managers said cash was 
coming into the high-yield market from 
new sources. Insurance companies and 
pension funds, which in the past have 
avoided taking risks on high-yield 
braids, are starting to buy more bonds 
that are rated below investment grade, 
they say. 

w* A." 


89.5486 5.0300 
69.4208 7.9200 
96X353 10.4900 
65.6493 8.0000 

84.1250 8.1700 
92X500 7X500 
89 JO 34 7-5400 
78X313 8X500 
110X584 70X000 
91X966 7J300 
lOOJOOO 6.7200 
102X131 6X600 

98.0938 65900 
82.7788 8J800 
75.3392 8X000 

76.9375 8.1200 
65J588 4.9600 
92J619 7X200 

100X250 7.1600 
101X500 9X800 
S6J625 7.9400 
69J688 9X300 
99.8200 5.7300 

77.9375 8X600 
100.7800 7X100 

48.1875 7X600 
99X000 5.7500 
110X947 10X600 
105X915 9X800 
100X375 9.1900 
100X750 6X000 
128 6000 4X200 

72.9375 8.8300 
87.4363 7.9300 
75X500 4X500 
59X500 5X900 
64-5000 6X000 
90.7496 4.0600 
85X063 4.6800 

96.5000 4.6600 
161% 7.7600 

100.8000 6.7000 
98X475 7.0600 

70.9375 9X500 
82.9234 8X700 

92.1250 7X700 
100.9721 6X900 
99X846 6X500 
92X531 7X800 
99.5417 8 7900 
7X7533 7X200 

103X628 8J900 
100X750 6.7200 
94X987 7X800 
73X646 4X000 
945000 6X200 
103X500 7.1400 
92J289 7X600 
99X066 6.6600 
100X498 6.7300 
93X685 7X200 
54.2500 4.1500 
S6J625 4.6200 
95.9708 7.0900 
106X750 7X700 

99.5000 6X100 
99X000 8X100 
99.8700 6.0700 

100.0000 5 X900 
101X750 8X60 0 
105X750 9X100 
100X100 6X400 

New International Bond Issues 


■Set * %r*4| 
pjterarjfcPMto _ 

t*?***Jf*« ._ ... 

4 i n"» W HilV ME. 

Compiled by Charlotte Sector 




% Pries 

Floating Rate Notes 

Bear Steams 

deneagles Funding 

2004 0X5 99.6537 
2002 0.05 99.9138 
1012 Vi 99.15 

— Over 1-momf] Libor. CaOoble from 2000. Fees OXOS. (Bear Steams intl.i 

— 0vEr3*mMrm Libor. Callable at par tram 2000. Fees 0.1 75%. (QNbcnJO 

Over 6-monlt) Ubar. Moncoflobfe Extendable until 2037. Fees OJO'fc. Denominations SI 00X00. 
(Nomura IntU 

Korea Exchange Bank 
Posfpankki ■ 

1998 0X5 100.00 — Orar34noBtlt Libor. Nanaflabie. Fees 0X5%. (GoamtertbankJ 

Over 3- month Libor. CoBoMe vnlfl 2012 thereafter 0.1 75 owr3-»nonlti Libor. Fees OAFe. 
Denominations SKIOQO. (Solomon BrotheisJ 

2008 0X5 moo - 

Ovw6-fflORtti Libor. Average I3e 6X years. Fees 0X5S>- Deimranotions SSMtOOO. (Credit Suisse - 
First BosfonJ 




2002 Flbor 99.745 - 

Interest wM be (he 3-monffi Ubar. Noncaflable. Fungible with outstanding Issue, raising total 
amount Id 5350 mBon. Fees 0.175%. (CoramenbankJ 

SvensJvD Handel sbanken 

1999 llbor 100.058 - 

Intefestwlll be the 3-montti Libor. NoncaUoble. Fees ai0%. Denoinlnattans SiaOOO. (Sfltomon 

31 Group 

2007 0.10 99X9 
2007 0.30 100.00 

Over the >montti Libor. Nonca liable. Fees 0X5%. (5BC WnbuigJ 

Over 3- month Libor. Callable at gar fiwn 1998. Fees'025%. (Morgtm Stontey.1 



5750 2007 7V% 99.957 100.90 Nonatfkftfe. Fees 0X0%. (ABN-AMRO Hoare Govern 

Associates Carp, of North 

5500 2002 61% 101X64 100.70 Ren ff e mJ n> 99.914. NoncnUobte. Fees I w%. (Woman Slreitey litft J 

Bank Austria 
Beta Finance 
Benpres Holdings 
Bremer Londesbank 
Dresdner Finance 

Kreditonslnlt Fuer 


2000 64% 101.0075 100X5 Reofferea at 99X2. NoncoUaMe. Fees 1 **%. (SBC Warburg J 

2002 6% 99.773 100X2 NoncaJlobie. Fees ltVli. (Salomon Brothers I nfL) 

2002 m 99X14 — Noncnfiabte. Fees 050%. (J.P. Morgan.) 

1999 6% 101.075 100X6 Reoffered 0199.975. Fees t'A%. (CornmeczbonkJ 

2001 6 Vi 100X0 99X8 Reoftered ot 99X0. NoncoSabta. Fees l*iA*(DresdnOTlOetmKirtBensorO 

2001 6»% 101.15 — Reoffered at 99.75. Nancolloble. Fees 1W&. (NMco EurapeJ 

Londesbank Schleswig 

2000 61% 100.891 loan Reoffered dt 99X035. NoncaUoble! Fees I (GBC Wood GundyJ 

Lloyd's TSB Group 
Morgan Guaranty Trust 
National Australia BA 

New Zealand 

Safra Leasing 

6 99.97 — 

6% 100.928 100.02 
6V% 100X81 99.90 

99.95 — 

81% 99.757 — 

Noncot lotrfe. Fees 0.10%. (Lehman Brothers Inti . ) 

Reoffered dt99X53. Nonooflobte. Fees »»%%. UP. Morgan Intl.i 
Reoffered ot 99X816. NoncoUaWe. Fees 1 .10%. (Nomura Inti J 
CaHabteot parte 1999. Fees 0X5%. (Morgan Sbrtey.) 

Semtonmiolly. Redeemable In 2000 at 991% ana In 2002 at 99Mi Fees 0X5%. Denominators 
SlOCUtoa (Deatsche Morgan GrenfeflJ 

SBC Jersey 

United Parcel Services 


6V| 101X25 100X5 

Voto-Votorontim Overseas 
Trading Operations 

6M 100X88 100.05 
9 Mi 99-735 
8 Vi 99X43 ^ 

Reoffered at 99.70. Noncallahle. Fees tSBC Woiburg J 

Reoffered at 99.70. Noncollabte. Fees 1 Wte. (Merrill Lyncti inti) " 
NoncoltaWe- Fees 1 X%. Denomteations si Oaooo. (ING Borings}- 
Semta«iuaH». Redeemable Ot 99'% in 2002. Fees (USOV. (ING Barings.) 


TV * 

•i fimt Awl' Hea-t 

■ . 5£1* aJ k ui 

» A 

rr.«SM$b m 



■T ir 

'■trpaf V 1 

■%' v % 

:•=' y.tH, ar* .Wfcjv 
* il- 'liwi 

r- ^ !>».- 

2 -V f trsrt 

e.W i 


- ^ lw* 

■s7«it zJyt-ft , tin 

jri.'iaaps shod *r-i 

•; ■;-.%*?= y ivri rH iw% 


•-rUT sbr. -At pro 

*--»Vv>ho t 

'-trer * a nt \ 


** s'i’itSs' MatribU 1 
— T- SjAanet 
Aral W ' *f» 

\-zs ary twBri-tSWM 

■>* wjrsxftti': 

Westdeulsche Londesbank 

Denver: Heads of state and finance 
ministers from the Group of Seven 
leading industrial countries plus Rus- 
sia hold their annual summit meet- 

BayeriscMe Verelnsbank 




2001 6V% 101X2 100X0 Reafferedat99.92.NoncolioMe.FeeslMA>.(Oaiwo.) 

2002 4^ 98X9 99.15 NoncoHabto. Fees 0X5%, (Borerfscbe VereiiBbank.) 

? H: t hiiwspf 



6 103.175 

i 02X0 Reoffered aMOt. Noncollabte. Fungible erttti outstanding Issue, raising total amount to IX 
baton moite. Fees Ttfih. (Deutsche Moigon Grenfell.] 

European Investment Bank 
WesWeutsche Londesbank 

Credit Suisse Rrst Bastan 



5 101X6 

1 97X3 

8W 99X03 

99.95 Reoffered ot 99 Jl. Noncollatite. Fe« 1 (ABN^UIkPO Hoare Govett.) 

Reoffered at 97X1. Noncaltobte. Fees 030^ lBoyertsche“u>ndesbanlO 

— pdlable ot gar from 2009 ttiereafler Interest is 0.100 over the five year war. Fees D.7S%.(Cred> 


Boyerischo Londesbank 

4% 100X25 — 

Interest wdl be 4Wfl6 until 2002 thereafter 0.08 over tbeTEC-10 Index. Fees 0X25%. (JP. 
Morgan Secwfties^ 

57/ 4 101X94 

1 00.65 Reoffered at 99.919. (sue may be redenominated In euros after EMU. Fees 2%. (CDC 


Credit Suisse Financial 



5 Vi 101X52 
7X 101X75 

Toyota Motor Cretftt Co- 

World Bank 

— ReaHered at 99.902. Fee5lWL(5odetoG«neratej ' 

Rwffe red cl 99.95. tewierhosogtlantoaonvortbawetooFftN'Mm 0X5 tnteiBtrwg tin 

month Ltoar. Fees l M,. (Credit Subse Fl rtt Boston.) 



zero 3J5 

99.90 Noncollabte. Foes 1 *V1G. (Credtta ttotianoj 

3.05 Yield 12X2%. Rsoffcred at 3.05. Noncatobie. Proceeds 62.9 million rand. Fees 0 20%. ISoOe* 

Equity- Linked 

ABB Inti. 

$150 2KM 2^4 100.00 — 

Samsung Electronics 

5300 2007 zero 100.00 - 

Ctotobte front 2000. Convertible at 1701 X9 sutose Trancs per share, a 21 .82% premium, and ot 
1X32 sh per dollar. Fe es 219%. (Credit Suisse Flrsl Boston.) 

j te de e roobta to 2002 fa yield 0X0 toi JO below Treasuries. Convertible at on expected IS %>»*> 

premium. Fees 2»%%. Twms 10 set June t9. (Deutsche Morgan GrenfeRl 

Last Week's Markets Euromarts 

Stock indexes 

Money Rates 

United %imy- Jonei3 iunei %CWge untied States 

Sjyr Sf 

sipioo a 3SS z 85:i6 Fedeful,umb,ute 

JAPSOO 893X7 858X1 , 4.11 -kroon 

Eurobond Yields 

June 13 June 6 

Weekly Sales 

1 4150X4 1.008.72 +XI5 

46517 , +380 C« money 

NKdoqCp 1X23X4 1X04.85 *1X9 3^nortti Werbwik 

S 225 20J2U52a4a5 - 75 SUrote 

onfoin CoDmoney 

PTOE 100 4.783.10 4X45.00 + 2.97 Jmonth (rtoibunk 


TSEhflus. 6X58X0 6,493X0 + 103 Tr355«tion rata 

France Coll mon ey 

CAC 40 2X08X2 1719X5 + 22B 3jnof,fh ,l| to rtMr * 


D** 3.744X4 3X95J9 + 131 

Hong Kong 

Hang Seng 1611155 14X5113 - 3.70 

UX.S (ong term 
l/X. Srndm terra 
U.S. % shod term 
Pounds sterling 
French francs 
Danish kroner 
Swedish kronor 

ECU& mdm lem 

Can. 5 

tall -fcMiVr Mgll Yr lew 

685 695 
6l50 661 
4X4 6X3 
7X1 7XQ 
5JU 5.03 
6.92 698 
558 663 
5X0 5X1 
6X1 6X3 
5X3 5X1 
6A4 610 
685 6.96 
7X0 7X8 
2.14 2.14 

7.08 653 
683 610 

650 5.96 

7X5 7JW 
5/M 446 
7X8 652 
552 5X8 
541 4X2 
6X2 5.76 
5X2 4X8 

651 5X0 

7X6 645 
8X9 7.19 
£14 144 

Primary Mamet — 


S Hots S 
Straights 6074 5834 3^04 

Convert 24 - 3764 

FWfc 4167 1X034 4114 

ECP 15X704 7X625 17X04.7 Mg? 
Total 16497X 9,1494 214429 H.* 0 " 
Secondoty Mamat — 

Swnre- Luxembourg slot * exchange. 


S told 5 

Straiohls2&53Q.l 11903.1110477X31^ 
Convert 919.0 7764 iWJX 

FRNS 18X564 7.2759 55X87.2 7^g 
ECP 144824 118654 246«X«^f 
Total 33439X 39421 51934874 67X»' , 

Total 33439X 3»42lX19348 
Sourer: Eumdear. Cede/ Bor*. 

3.744X4 349SJ9 » - 

Call money 
3-nwitn intsrMnk 

Libor Rates 

931X0 901X6 .3X2 ~ ^6%Qi' qtl 

'-mote* hn« e — o n i-outob 

SSSSUBf IK ”• ecT’™' a S s 

Pound stoning 6M Ato, Yen h '-i ** 

Sources- Lknric n~~i — 

London pjn.ftos 341X0 34440 .aw 
iVorttf miter from Morgan Stonier Cap ter rnfl Penpectfre. 

Sources: Ueyds Bank Reuters. 

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ild Tan ' Dollar Rides 
*0n Hopes 
| For Euro 

Currency Should Gain 
If Ell’s Plans Hold Up 


Bloomberg News 

. .. NEW YORK — The dollar may rise 
against the Deutsche marie this week if 

r ■;. France and Germany manage to keep 
Vh Europe’s planned single currency on 
-I ‘ uack, analysts said. 

Signs that European economic and 
' monetary union will go forward era time 

generally help the dollar rise against the 
mark because the planned single cur- 
rency, of euro, is expected to replace the 
rnnrk as Europe’s main currency. The 
euro is scheduled to be introduced Jan. 

f “The removal of the fear of an out- 
right collapse of EMU will benefit the 
dollar," said Hillel Waxman, head of 
foreign exchange ar Bank Lenmi Trust ' 
Co. in New York, referring to the pro- 
posed European monetary union. 

He predicted the dollar would trade in 
a range of J .7265 DM to 1 .7630 DM and 
between 114 yen and 117 yen this 

Last week, the dollar rose to 1.7365 ' 
DM from 1 .7253 DM the previous week 
and to 1 14.805 yen from 114.400 yen. 
The dollar was buffeted at times by 
concern over- Japan's growing trade sur- 
plus with the United States and turmoil 
over the outlook for monetary union. 

Investors were cheered by a U.S. gov- 
ernment report showing that producer 
prices fell for a fifth straight month. 
Stocks and bonds rallied on the news, 
encouraging demand few dollars from 
» overseas investors. 

Warnings about possible trade ten- 
sions between the United States and 
Japan helped send the dollar to an eight- 
month low of 1 10.65 yen on Wednes- 
day. But the U.S. currency rebounded 
Thursday after Japan’s top currency of- 
ficial, Eisuke Sakakibara, head of die 
Finance Ministry's international depart- 
ment. said Japan would act to halt the 
yen's weakness. 

“The intervention has been verbal,” 
one analyst said. "The U.S. and Japan 
are comfortable with a range of 112 to 
117 yen and are in cooperation to keep 
the dollar there." 

■ Gains Seen for Japanese Bonds 

Japanese bond prices appear likely to 
rise amid expectations that reports out 
j this week will not give the Bank of 
• Japan enough confidence in the econ- 
omy to raise interest rates from record 
lows, Bloomberg News reported from 

Bonds also are expected to get a push 
this week from a growing consensus 
that the U.S. economy is slowing. 

“Dimming rate-hike concern in the 
U.S- is a plus for domestic bonds,” said 
Shunji Sakami, chief strategist at L7CB 
Securities Co. Higher U.S. rates would 
put pressure on other central banks to 
follow suiL 

Japanese bonds will remain strong 
because there is no economic indicator 
due this week that could change the 
perception that interest rales will remain 
on hold for now, said Yoshiaki Mak- 
istrima, senior analyst at Sanyo Invest- 
ment Research Co. 

Bonds were only briefly sidetracked 
Friday by the Economic Planning 
Agency’s report that the economy grew 
at a 1.6 percent pace in the Jauuary-to- 
Maxcb quarter, fra: an annual pace erf 6.6 
percent. Faster growth could spark spec- 
ulation (hat the economy is strong enough 
to aHow-the central bank to raise rates. 

Traders said they were now focusing 
primarily on the June 25 release of the 
Bank of Japan's quarterly tankan survey 
of business sentiment. “Next week, 
ahead of the tankan, it's going to be 
extremeTy tough to move,” said Kenji 
Saito, a portfolio manager at Sakura 
Investment Trust Management 

Firm Bets on High-Tech Bandages 

By Erik Ipsen 

Internal tonal Herald T ribune 

WINSFORD, England — Keith 
Gilding is a man professionally on- 
fazed by human frailty. From minor 
scrapes and cuts to what he describes 
as huge erupting lesions where the 
stench of the exudate is overpower- 
ing” they stand merely as his chal- 
lenges, and the grislier the better. 

As a co-founder and managing di- 
rector of a company that makes high- 
technology wound dressings — from 
the kind you stuff into festering body 
cavities to the kind you peel off and 
wrap around yonr finger Mr. Gild- 
ing depends on wounds. 

What he loves though are polymers, 
wonderfully simple and flexible 
chemical compounds that can be as 
hard as nails or as soft as skin. It is 
polymers that lie at the heart of In- 
novative Technologies' state of the art 

In place of cotton and the adhesive 
backed vinyl of yore, six-year-old In- 
novative Technologies offers 
everything from alginates — the water 
absorbing cells of seaweeds like kelp 
— to hydrocolloids, synthetic rubbers 
as flexible as flesh. 

As a chemist by training and a poly- 
mer specialist by dint of a long career 
spanning polymer operations from 
those of Royal Dutch/S hell and John- 
son & Johnson to a series of s mall 

start-ups, Mr. Gilding is convinced 
that his customized compounds can 
reduce medical costs. In the process he 
also fully expects they will make his 

His pitch to hospitals has a nakedly 
mercenary appeal. 

“We tell them, We want to help you 
save money,” said Mr. Gilding. By 
using, for instance, alginates that ab- 
sorb 20 tunes their weight in liquids 
versus traditional cotton gauzes that 
absorb only three times theirs, and 
then by covering those alginates with 
special, breathable films, the company 
claims it can extend the life of dress- 
ings by up to 10 times. In hospitals 
where ft costs an average of $50 to 
have a nurse change a dressing that ran 

amount to a significant saving. 

Innovative Technologies’ roots 
stretch back to the potting shed in Mr. 
Gilding's garden. It was there in the 
autumn of 199 1 that he began cooking 
up the specific polymers that became 
the essential ingredients for all the 
company's dressings. 

With cash from a wealthy South 
African investor, the company was of- 
ficially started in December 1991. 
Three years later it went public at 120 
pence a share. Now it trades for around 
300 pence a share, giving the company, 
which in the best traditions of the high 
tech medical industry has never made a 
penny in profit, a market value of just 
under £100 million ($163 million). 

What excites investors and Mr. 
Gilding alike are estimates that the 
high-tech ' ‘ woundcare* * market mighr 
be worth $2 billion a year and is grow- 
ing fast. 

Last year. Innovative Technologies 
shifted its main emphasis from re- 
search to production, posting losses 
fra- the year of £4 million on sales of 
£1.4 million. This year the company 
expects to break into the black on a 
monthly basis in December, and then 
to consign their red ink to the bottom 
drawer thereafter by remaining prof- 

Unusually, innovative' Technol- 
ogies doesn’t license its technology 
out to others, but rather produces its 

E roducts itself. Distribution and mar- 
ering, though, are left to 16 partner 
companies around the world, ranging 
from 3M in the United States to 
Nikomed in Japan. 

Cliff Gundle. the South African en- 
trepreneur whose cash helped start up 
the company, attributes its success not 
only to us patented technology but to 
something ne calls “teamsmanship.” 
Specifically, he points to the team of 
Mr. Gilding and Diane Mitchell, the 
former geneticist turned IT executive 
director, who is also Mr. Gilding's 

“I am no ‘yes man,' ” said Ms. 
Mitchell, adding that their “round the 
clock partnership” has been a plus for 
the company. 

PAGE 13 


U.S. Challenges a Suharto Pet Project 

By David E. Sanger 

New York Tunes Sen'ice 


WASHINGTON — The Clinton ad- 
ministration's announcement Friday 
that it would ask (he World Trade Or- 
ganization to rule against Indonesia's 
national car project, a program run by 
President Suharto’s son mat puts for- 
eign companies at a disadvantage in die 
county's potentially huge automobile 
market, was the first direct U.S. chal- 
lenge to the financial empire of the 
president of Indonesia. 

The challenge comes after months of 
unsuccessful negotiations with Indone- 
sia that have been the subject of ex- 
traordinary scrutiny in Washington be- 
cause of campaign-finance scandals. 

In President BUI Clinton’s first term, 
die Riady family of Indonesia, which is 
at the center of the investigations, re- 
peatedly played an intermediary role in 
an effort to smooth relations between 
Mr. Suharto. Asia’s longest-serving 
leader, and die White House. 

Friday, however, the administration 
was under pressure to show that it was 
giving no special treatment to Indone- 
sia, and in recent weeks relations have 
hit some new lows. 

Reacting to sharp criticism in Con- 
gress of its treatment of dissidents in 
East Timor. Indonesia on June 6 can- 
celed the purchase of nine F-16 fighters. 
Mr. Suharto, in a letter to Mr. Clinton, 
complained of * 4 wholly unjustified crit- 
icism” of Indonesia in Congress. 

Separately, die State Department crit- 
icized the recent elections in Indonesia, 
declaring that the country’s “electoral 
system severely limits political compe- 
tition” and that “Indonesian citizens do 
not have the ability to change their gov- 
ernment through democratic means." 

Whether Washington would chal- 
lenge the car project, however, was 
widely viewed as a test of the admin- 
istration’s willingness to confront Mr. 
Suharto over a business directly linked 
to his family’s fortune. The project 
began in February 1996 by presidential 
decree. It is controlled and managed by 
Hutomo Mandala Putra, better known 
as Tommy Suharto, the president' son. 
And the cars it sells enjoy exclusive 
exemption from the huge tariffs and 
luxury-sales taxes applied to the import 
of foreign cars and parts. 

Those tariffs have been a major point 
of contention because Indonesia, with 
200 million people, is viewed as one of 

the most promising car markets in 
Southeast Asia. 

The younger Suharto does not yet 
make any cars; he imports the Timor, as 
the car is known, tariff free from Kia 
Motors Coxp. of South Korea. Other car 
makers pay tariffs and taxes of up to 200 
percent, meaning that a $15,000 car 
costs $45,000 by the time it reaches an 
Indonesian consumer. 

The arrangement so enraged the 
European Union and Japan that they 
have already challenged the program 


before the World Trade Organization, 
and the first hearings of a dispute res- 
olution panel are expected to begin this 

By the accounts of most experts fa- 
miliar with the General Agreement on 
Tariffs and Trade, the worldwide pact 
that covers state subsidies, tariffs and 
other trade measures. Indonesia has little 
chance of winning its case at the WTO. 

Yet the Suharto government has 
vowed to fight for the project, which is 
based on an experiment in neighboring 
Malaysia where a national car called the 
Proton is being built 

An administration official familiar 
with the case said Friday that be did not 
doubt the case would be difficult for the 
Indonesians. “They have to go back to 
the big boss and say ‘no go’ on this.” he 

The official said that the filing made in 
Geneva .on Thursday was intended to 
preserve Washington’s right to join the 
European and Japanese case, and thus to 
help force Indonesia to reach a settlement 
that would avoid an embarrassing loss in 
front of the World Trade Organization. 

The pressure to end the project' s pref- 
erential treatment, however, is only one 
of the problems the Suharto family has 
run into as it ventures into the auto 
business. Indonesians appear to dislike 
the car itself. 

Trade industry reports indicate that 
sales are running at only 2,000 cars a 
month, half of the initial target. To in- 
crease sales, the government recently 
said it was thinking of requiring gov- 
ernment agencies to buy the Timor for 
their fleets. 

Even The Jakarta Post has written in 
an editorial that the project was “seem- 
ingly guided more by nationalistic sen- 
timent and politics than by industrial 

McCarthy Buys a 33% Stake in Branson’s V2 

LONDON [Reuters) — McCarthy Corp. PLC. a leisure and technology in- 
vestment company, said Sunday it had acquired a 33 percent stake in Richard 
Branson's V2 Records for £55 million ($89.9 million). 

“Richard Branson’s credentials in the music world are impeccable, and we are 
delighted to be able to participate in the development of what we are sure will 
become a highly successful international music and publishing business," Mc- 
Carthy said. It said the £45 million cash portion of the transaction was payable in 

equalinstallments over 40 months. 

McCarthy also agreed to provide a debt facility of £10 million to be available 
within two years of completion of the acquisition. It said £7 .5 million of financing 
had been provided and further financing was expected pending completion. 

V2 was Branson's vehicle to return to the music business after his sale of Virgin 
Records in 1992. It is currently releasing its first records, and it plans eight major 
album releases by the end of the year. Artists signed include Sierophomcs. Heather 
Nova, jungle Brothers and Addict. 

Netscape Says Flaw Has Been Repaired 

WASHINGTON (AFP) — Netscape said it had fixed a flaw in its Internet 
browser software that could make data stored on home computers accessible to 
Web-site operators. 

The “patch,*’ or repair job, was announced less than a day after Netscape said a 
Danish company that detected the flaw had demanded money in exchange for its 
help in eliminating the bug. 

The patch is being tested and should be available soon, a Netscape spokes- 
woman, Catherine Com?, said. Despite the flaw, she said that it would be “very 
difficult” for Web-site operators to penetrate the security system and gain access to 
a user's files. 

Alcatel of France Wins 5- Year Irish Contract 

PARIS (Bloomberg) — Alcatel said it had won a five-year contract to supply 
digital telephone-switching equipment to Telecom Eireann. The value of the 
transaction was nor disclosed. 

The contract calls for Alcatel to help expand and modernize Telecom Eireann ’s 
telecommunications network as one of two major switching equipment suppliers, 
the French company said. 

Alcatel said it had acted as a supplier of a variety of digital equipment to Telecom 
Eireann. Ireland's state phone operator, since 1981. 

China ’s Fixed- Asset Investment Rises 15% 

BELTING ( AFP l — China’s fixed-asset investment in the first four months of this 
year was up 15 percent from a year earlier, the official Xinhua news agency reported 
Sunday, quoting the State Statistics Bureau. 

The country pumped 242.5 billion yuan ($29.2 billion) into fixed assets during 
the period. 1395 billion yuan of which went into capital construction, which was up 
18.8 percent, the bureau said. 

Some 44.6 billion yuan, or 1 8.4 percenr of the total, went into technical upgrades, 
the bureau said. 

2 Concerns Seek to Exploit Chinese Gold Mine 

BELJING (AFP) — The Australian mining giant Broken HiU Pty. and Newmont 
Mining Corp. of the United States are vying for a stake in China's Lannigou Gold 
Mine project, the official China Daily Business Weekly reported Sunday. 

China National Gold Cdrp. plans to choose a partner based on feasibility reports 
the two companies must submit by Aug. 10. 

Both companies have expressed an interest in the long-awaited mine “for many 
years” and want to explore surrounding areas as well, the newspaper said. The 
mine's main vein, located in Guizhou Province, has a proven gold reserve of about 
60 metric tons, according to Chinese figures. 

Dassault Provides Papers to Belgian Court 

BRUSSELS (Reuters) — The French industrialist Serge Dassault has handed 
over documents relating to a bribery investigation to the Belgian judiciary. Prime 
Minister Jean-Luc Dehaene of Belgium said Sunday. 

A court in Liege lifted a year-old international arrest warrant against Mr. 
Dassault on Friday, but it was not clear what had prompted the move. 

“I understand that Mr. Dassault and his lawyers have passed documents to the 
Liege judiciary,” Mr. Dehaene said on Belgian television. He said he did not know 
whether this was why the warrant had been lifted and denied that there had been 
political pressure on the judiciary to do so. 

The court issued the warrant for Mr. Dassault in May 1996 in an inquiry into 
allegations that Mr. Dassault paid 600 million Belgian francs ($17 million) to political 
parties to gain a contract to fit air-defense systems to Belgian F-16 jets in the 1980s. 

JUMBO: Flying in the Face of Boeing’s Monopoly, Airbus Plans a Larger Long-Haul Jet 

Continued from Page 1 

tor. Airbus officials say the 747 is a cash 
cow that enables Boeing to undercut 
prices on smaller aircraft. 

Boeing has abandoned plans for its 
own superjumbo, and, according to Mr. 
Pierson, it has every reason to prevent 
Airbus from building such an aircraft. 
He said die merger with McDonnell 
Douglas and the exclusive airline deals 
could give Boeing "the means to fi- 
nancially throttle Airbus and prevent it 
from completing its product line, es- 
' ly the A3XX, to end the Boeing 

747 monopoly.’' 

The head of Boeing’s commercial air- 
craft group, Ron Woodard, said the com- 
pany already had a 600-seat capacity 
aircraft — die 747-400, which already 
operates on short-haul flights in Japan 
with 550 seats. He said 600 passengers 
could befitted in but conceded that such 
a load would be “probably not a lot of 

The A34H-600, scheduled for deliv- 

ery in 2001, envisages a three-class lay- 
out and routes as long as 13,500 ki- 
lometers (8,400 miles) — nonstop from 
Singapore to London, for example. 

Airbus is also working on a longer- 
range version of the aircraft, the A340- 
500, designed to carry as many as 313 
passengers on routes as long as 15,400 
kilometers, making it the world's 
longest-range airliner. Airbus said it was 
working with a group of about 20 po- 
tential customers on their requirements 
before announcing the program's 

Airbus said it had identified a market 
for as many as 1,400 aircraft with 550- 
seat capacity and above. But the leaders 
of British Aerospace PLC, one of the 
Airbus partners, said the supeijumbo 
project would fail unless the consortium 
rapidly transformed itself into a limited 
company. John Weston, chairman of 
British Aerospace, said that if Europe 
did not regroup its aircraft-building ca- 
pabilities into a single force, it would be 
unable to compete with Boeing and 

Lockheed Martin Coro. The managing 
director of British Aerospace, Chris 
Geogheghan, said the company could 
not consider a huge investment on the 
A3 XX “without a fundamental change 
being made along the lines of the single 
corporate entity." 

Thar view was echoed by Serge 
Dassault, the head of the French aircraft 
maker Dassault Aviation SA, who said 
(he French aerospace industry risked 
being relegated to second-class status 
unless it participated in a restructuring 
of the European industry. The restruc- 
turing has been placed in doubt by the 
election of a Socialist government in 
Fiance, which is opposed to privatiza- 
tion and could halt a planned merger 
between privately owned Dassault and 
stale-owned Aerospatiale, the French 
partner in the Airbus consortium. 

“I remain in favor of a merger with 
Aerospatiale provided it occurs simul- 
taneously with privatization,” Mr. 
Dassault said. He added that he would 
be content if the state kept 49 percent of 

the shares in the merged company. 

Industry executives are awaiting a 
speech by Prime Minister Lionel Jospin 
that will conclude the air show next 
weekend and which they hope will cla- 
rify France’s position. 

The Airbus partners, which also in- 
clude Daimler-Benz Aerospace AG of 
Germany and Construcciones Aeronaut- 
icasSAofSpain, signed a memorandum 
of understanding in January to pool their 
assets into a single corporate entity. But 
last week, Yves Michot, the chairman of 
Aerospatiale, said die Airbus facilities 
should continue to be owned separately 
by the partner companies. 

Airtns needs to acquire corporate 
status to tap into capital resources and 
attract new partners, according to in- 
dustry analysts. Ministers from the Air- 
bus partner nations were scheduled to 
confer at the air show Monday. The pres- 
ident of Britain’s Board of Trade, Mar- 
garet Beckett, said, “I shall be actively 
encouraging the restructuring of Airbus 
to enhance its international position.” 

-it Vi. ’■ . » r> . '^n— 

HIGH-TECH: Chinese Enterprise Prepares for a Leap Forward 

__ r .-fa ■ 

aLie rr 1 -. 


Continued from Page 1 

state-owned company to make integrat- 
ed circuits. 

The shift in Chinese industry has im- 
portant implications for U.S.-C h i n a re- 
lations. Last year, Chinese exports of 
appliances to the United States ex- 
ceeded-those of textiles or toys. This 
new wave of exports is likely to thwart 
U.S. efforts to reduce its politically sen- 
sitive trade deficit with China. Depend- 
ing on whether Chinese or U5. es- 
timates are used, that deficit is between 
S3) billion and $40 billion, and it is 
growing steadily. 

‘*China is - looking to move up the 
value- added ladder,” a U.S. official 
said. “I expect the deficit will increase 
over the next few years as a result of 
China being able to produce higher 
valueradded on its own or with the help 
of joint ventures.” .. 

:■ now, much of China’s advance ■ 
has been into what might ^be called 
“Huddle tech.” Here rn Wuxi, Bosch- 
Sicznens Hausgerate GmbH has set up a 
to rusk* washing machines, and 
Bhita Rcfrigeration is making air 


Sotoc business people and consult- 
antt diwfr . whether China can join die 
JWfeTof the most tcdmologjcially so-. 
nations in the near future* 

. ^_/rfitsweakediKationaJ^y«em, 

TCgtricfiiQBS on the free flow of mfbr- 
gHEBoa yvi gov e rn ment interference in 
ratoSml planning. 

is building the world s 
biggesS dumb economy,” one Berjihg 
c ^ euti v c J said T adding that die designs 
and kshnazloas far mosi factories were 
afflaapoaed, - 

Many die big names in high tech- 
nology have initially only set up as- - 


«o*ly here. Forsome, only the 

packjBg iniaark] is locaUysoureed. 

— .lEvm.Wuxl Little -Swan, one of the 

country’s most sophisticated compa- 
nies, with a 45-person research and de- 
velopment department, remains de- 
pendent on technology provided by the 
Japanese industrial giant Matsushita. 

Little Swan has its own subsidiary 
that makes the computer control boards 
for washing machines, but that sub- 
sidiary imports printed circuit boards 
and small electronic components from 

There are stumbling blocks ahead as 
China goes high-tech. High-tech does 
not necessarily mean high profits, and 
the government’s helping hand is not 
always adept. China is trying to make its 
toward high technology by com- 
mand from above instead of initiatives 
from the grass-roots level of the econ- 
omy. This is an economic-planning 
model that has failed several tiroes since 
the Communist Party took power in 

A semiconductor plant built tty 
AT&T Corp. in Wuxi shows the dangers 
of this strategy. Both AT&T and a local 
state-owned company invested scares 
of millions of dollars and have lost 
millions more sauce it opened, industry 
sources say. Part of an earlier plan to 
boost China’s semiconductor industry, 
the plant’s technology was quickly 
overtaken. The Chinese joint-venture 
partner never understood the technol- 
ogy and was not nimble enough to adapt 
as the market changed. 

Lucent Technologies Corp., now the 
operator of the plant, declined to com- 
ment. But competitors say the plant 
fabricates semiconductors that are years 
out of date. The generations of semi- 
conductor wafers are measured in the 
size of the. chips. The Wuxi plant is at 
least two or three generations behind, 
making chips that measure two microns, 
white current technology has squeezed 
the size to half a micron. 

“Management doesn’t understand 

that technology doesn't stand still,” 
said one competitor. “Once you set up 
an operation and six months or a year 
goes by, if you don’t upgrade the tech- 
nology, the plant is outdated by the time 
it’s built. ” 

“A lot of machines are sitting around 
rusting,” said a Hewlett-Packard pro- 
curement expert who has seen other 
high-technology plants. “Just investing 
money isn’t enough.” 

Another problem is that successful 
Chinese companies tend to start acting 
like traditional state-owned enterprises, 
adding perquisites for workers while 
neglecting investment in research and 

While textile factories in southern 
ffrina continue to rely largely on mi- 
grant women in their late teens or early 
20s to toil at low pay, in Wuxi, Siemens 
employs 127 well-paid, university-edu- 
cated Chinese and has sent nearly half of 
them to Malaysia for additional train- 

Can high-powered executives be far 
behind? Bill Gaies, the founder of Mi- 
crosoft Corp., has formed alliances with 
(be top Chinese computer firms to lock 
them into his company’s operating sys- 
tem. Similarly, Intel, as it does in other 
countries, helps people here develop 
software on machines that, use Intel 

Some U-S. companies still hesitate to 
transfer their most sophisticated tech- 
nology. Others, however, say that using 
the best technology will make it more 
difficult for people trying to copy their 

“All of our machines are copied in 
China,” said Qemenz Bahr, general 
manager of Wuxi Buhler Machinery 
Manufacturing Co, which holds about 
70 percent of the Chinese market for 
food -processing machines. “Let teem 
do it- The quality is so lousy, it makes 
me happy. 

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International Herald Tribune A Special Report 

MONDAY. Jl NF. 16. 1W 
page it 





•<f ir ••■==' 

■■ -L.ift .... 

Although Airbus plans to build a fong-distancc A3 XX. it is also pinning hopes on its medium-haul A3 19. 

Industry’s 2 Superpowers Face Off 

By Barry James 

P ARIS — The head of Airbus 
Industrie accused the U.S. 
government on Sunday of sup- 
porting a “hegemonic'* at- 
tempt by its rival, the Boeing Co., to 
eliminate the European aircraft build- 

Jean Pierson called Boeing's 
planned takeover of McDonnell 
Douglas Corp. "a project aimed at 
.suppressing what has always been 
considered by some in the USA as an 
anomaly: real competition, a real al- 
ternative loan American monopoly in 
the aerospace industry.** 

Mr. Pierson was speaking at the 
Paris Air Show soon idler it opened to 
the public on Sunday. As aircraft from 
all over the world vied for attention in 
the air and along the taxiway at Le 
Bourget airport, the real action was 
taking place in a conference room 
where Airbus and Boeing engaged in 

their traditional start-of-show dog- 

Like fighter pilots lobbing missiles 
at one another. Mr. Pierson and hi> 
Boeing rival, Ron Woodard, president 
of the commercial airplane group, nev- 
er came face-to-face. Rather, they 
traded disparaging remarks and claims 
at back-to-back news conferences-. 

Mr. Woodard's accusation that 
Europeans had turned a blind eye to 
human rights in China so that Airbus 
could sell planes was one that par- 
ticularly angered Airbus. “Boeing 
never wants to admit that Airbus 
makes a better airplane.” said one 
official, pointing out that the consor- 
tium had built a large parts warehouse 
and training center in China as part of 
an extensive campaign to win orders 

Most of Mr. Pierson’s considerable 
ire was directed at Boeing's planned 
takeover of McDonnell Douglas, and 
by the 20-year exclusivity deals that 
the Seattle manufacturer has signed 

with three of the world's hugest air- 
lines. .American. Delta and Contin- 

Because airliners remain in service 
for at least 20 years, he sank the ex- 
clusivity deals were the equivalent of 
removing the three carriers trom the 
marketplace “lor eternity." 

He declined to comment on talks in 
Brussels on Friday between the Euro- 
pean Union's competition i antitrust I 
department and Boeing and Airbus 
executives. He said, however, that the 
EU hud every right to >ijii an inquiry 
because European laws apply to 
companies doing business in Euiope 
just as American law s apply to foreign 
companies doing business in Amer- 

In a written “personal view." Mr. 
Pierson said U.S. security needs do not 
justify the creation of a conglomerate 
incorporating the civil and defense 
activities of both companies. Instead. 

Continued on Page 19 



VKIn T . 

4 it- 

' wEHb| 

B suT' iwf 



Will the Cost Battle Ever Be Won? 

Fierce Competition Forces Airlines to Seek Cuts Constantly 

Bv Conrad de Aenlle 

L ONDON — When airlines lell 
you you're flying economy 
class, they mean ii. For one 
passenger on a flight Inst month 
from London lo Washington on a re- 
spected, financially sound American 
carrier, the check-in procedure was 
handled by a 20ish “temp ramp clerk.'* 
as his badge stated — code fora summer 
replacement. He gave the passenger's 
passport away to another American and 
ilicn neglected to give back the return 
portion of i he ticket. 

“You know what it is. we're having 
to cut costs." an apologetic chief flight 
attendant told the passenger after he had 

related the experience in a plea lor sy m- 

pathy . a newspaper and a drink, file cuts 
extend to high altitude, she coni tiled: 
“Instead of giving us enough people t« * 
do the job properly, they tell us we'll 
have to get by with a crew two people 
short. This isn't the way it was meant to 
be done." 

It is not clear exactly what the pas- 
senger thought when he armed in 
Washington ami found tlut his luggage 
had mu 'been so lucky. But to an airline 
executive assigned the task of grow ing 
profitability — ot turning a profit al all 
— in a viciously competitive industry . 
cutting costs is exactly the way it 
meant lo he done. 

The cost ofiuuning the world's com- 
nieicial air fleet fell In nearly S percent 

between pwl and — still nm-v 
when adjusted lot inflation — to 4-1 i 
cents per available lon-kilometei . in iIk 
arcane argot ul aviation statistics. An 
ATK represents one ton ol aii plane u.o 
el me one kilometer MM* mild. 

The veai IWt wa> an all-time low 
point m many reaped* for the itulusit y 
It was the culmination of a four-year 
liiiJtici <1 bloodbath in which the 
w ofld's airlines lost about 5*2U billion. 
Since then, unit operating costs have 
crept back m 4b cents per ATK. not bail 
considering ih.n the price ol fuel, one ol 
the biggest costs «»1 flying, rore 23 pci- 
cent hei wee it l ou 4 and r ,1, t> 

During the same nine, airlines le- 

Ci m till tied on P;ti»e 19 

Airbus Bets Heavily on Its China Card 

By Michael Richardson 

S INGAPORE — By signing a 
joint venture agreemeni re- 
cently with Chinese and Singa- 
pore companies to develop and 
manufacture a regional Asian Express 
Airbus fwinjet airliner, European plane- 
maken. are hoping to give a major boost 
to Airbus sales in Asian and global 

They see a potentially big payoff if 
the venture, ns expected, helps promote 
sales of Airbus planes and related Euro- 
pean aircraft in China, where the Euro- 
pean consortium's archrival. Boeing 
‘Co., has a dominant, though declining, 
market share. 

Marking the importance of the 
Chinese market. President Jacques 
Chirac of France traveled lo Beijing in 
May to witness, along with his Chinese 
counterpart. Jiang Zemin, the signing of 
the framework agreemeni for the joint 

The agreement was signed between 
AVIC. the state-owned Aviation Indus- 
tries ol China, a European group com- 
prising Airbus Industrie and the Italian 
firm Alenia SpA, and a Singapore gov- 
ernment-controlled company. Singa- 

pore TeJl i mingles Pie Ltd. Under the 
terms of the accord, two \ ersions «■< the 
new jet. to Ik* known as the AE31»* and 
AE3I7 — AE stands lor Asian Express 
— will be made. 

The plane will be in ihe u 5-io-i24 
seat lange and i> scheduled to begin 
service by 2< H>3. 

Tile protect will be managed by a 
company that will be set up in China 
with a planned shareholding of 4b per- 
cent by AVIC. 3 l » per vent by An bu> and 
Alenia. and 15 percent by Singapore 
Technologies, whose aerospace unit 
services and upgrades aircraft and man- 
ufactures aviation parts lor Aiibus and 
other planemakers in Singapore. 

Mr. Chirac and Mr. Jiang also wit- 
nessed the signing ol a Chinese order for 
30 Airbus jets worth SI .5 billion. 

Airbus is fighting hard to gain a big- 
ger share of the Chinese aviation mar- 
ket. the world's fastest glowing market 
for civilian airliners. 

China is expected to buy 111 pen. cm 
of the SI 24 billion in total’new aircraft 
orders worldwide over the next 20 
years, according to Boeing estimates. 

Until Airbus signed the agreement in 
May to supply 3U more jets lo China. 
Boeing reportedly had about a oti per- 
cent share of aircraft operating or 

ordered by China, compared to 15 per- 
cent fui Airbus. 

Bui Airbus aiiciali in opetaiioii or t«- 
be delivered to China now total 11 ; 
almost triple the 33 oidored or in u»e i: 
the end of |M*»5. In h ,u b. Airbus oni -old 
Boeing by nearly three to one m term • • »: 
the value of Chinese orders. 

The 124-seal A3 1 9 is currently .Aii - 
bus's smallest aircraft. 

T HE new AE series will fit m 
below the A31M and will have 
similar flight decks, computer- 
ized controls and other feature^ 
ol the Airbus pioduct line to lower de- 
velopment and operating costs. 

For carriers w ith Airbus fleets. >uvh 
compatibility will reduce a wide range 
of costs, in *ni slocking spare parts k* 
pilot naming. 

More importantly for Airbus, u could 
encourage buyers to move to bigger 
aircraft in the Airbus ianiily when they 
decide lo buy larger planes. 

The Mav agreement marked another 
major stride forward for China as it tries 
to build a world-class manufacturing 
base for commercial jet airlincis. one ol 
the last industrial bastions still dum- 

Continued on Page IK 

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World-Class Electronics 

PAGE 18 . 



Are Passengers the Losers 
In Airline Partnerships? 

Carrier You Choose May Really Be Another ~ 

By Barry James 

P ARIS — Passengers flying the 
“friendly skies" of Unired- 
Lufthansa-SAS-Air Canada- 
Thai Airway s-Varig may not 
' ■now it. but they are pan of a trend as 
alliances between carriers become more 
lormnl and widespread. 

The airlines say that this is all in the 
interest of offering passengers a ' * seam- 
(ess" — their most popular buzzword 
— service from any point in the world to 
-ny other. 

But more to the point as far as the 
airlines are concerned is that alliances. 
. je good for their bottom line. They can 
•hare facilities with other airlines and 
expand their route network at relatively 
little cost. However, the trend worries 
•onie passenger organizations and un- 
ions representing airline crew. 

There is a danger of less competition 
-ltd thus higher prices as airlines co- 
alesce into ever larger sales and mar- 
veling organizations. There is a danger 
*;f deceptive packaging in that the air- 
line you actually fly may not be the one 
you thought you -.were booking for. In 
inti, some airlines, including the one 
hat bills itself as the world's favorite, 
iiave started to franchise their flight 
operations, allowing small independent 
carriers to wear their livery and serve as 
leeder operators to main hubs. 

Airline crew organizations are con- 
cerned about the increasingly prevalent 
practice of keeping staff at overseas 
oases where costs are lower, and by the 
interchanging of crew on some flights. 
The Association of Flight Attendants in 
ihe United States has expressed concern 
in (lie Federal Aviation Administration 
.-bout the lack of English skills of some 
abin staff seconded to American car- 
: ters as pari of alliance arrangements. 

But some airlines argue that basing 
ilictr crew on other operators’ flights 
•■rubles them to retain their identity 
.. 'thin the alliances. 

Delta Airlines reserves blocks of 
eats on the flights of airline partners 
and puis its own attendants aboard to 
look after its passengers. Aer Lingus 
*. rcw.N don Delta uniforms on some 
Slights. A service from Vienna to Wash- 
ington is operated by Austrian Airlines 
but carries extra cabin stafffrom Swiss- 
•ii and Delta. Japan Air Lines puts some 
"f its stewardesses aboard the flights of 
■\ir France and other partners to enable 
them in hone their language skills. 

I 'ntil now. most of ihe more than 360 
;t*rline alliances around the world have 

been simple code-sharing arrange- 
ments, bur often without much thought 
being given to coordinating flight 

In code-sharing, two or more airlines 
pur a single two-letter code on their 
flights, which then shows up on com- 
puter reservations systems used by tick- 
et agents and travel agencies as though it 
were a single flight. 

Code-sharing can benefit the custom- 
er by providing a total travel package, 
and avoiding the need to check in bag- 
gage at each connecting point. Bui iL can 
also make it harder for passengers to 
find perhaps less convenient but cheap- 
er connections, particularly where these 
are not prominently displayed on com- 
puter reservation screens. 

'Hie loose partnerships and bilateral 
deals are giving way to much more for- 
mal arrangements that might be de- 
scribed as mergers were it not for re- 
strictions on . airline ownership. 
Passengers flying with the new Star Al- 
liance — the consortium headed by 
United and Lufthansa — will be able to 
amass frequent flyer miles for travel on 
any one of the partner companies, while 
the airlines have put in place an integrated 
sales, marketing and reservations system. 
The next logical step, airline analysts say. 
will be a common fare structure. 

There has been, however, no ex- 
change of equity, and the member air- 
lines keep their own identity within the 
alliance. Nevertheless, the alliance sys- 
tem raises questions about the brand 
loyalty that airlines have struggled to 
establish over the years. 

The Star Alliance may be the shape of 
what the entire airline marker will look 
like within a few years. Philippe Brug- 
gisser. president of the SAirGroup that 
owns Swissair, told World Airline 
News recently thai "competition be- 
tween companies is over. The future is 
going to be competition between sys- 
tems. and l can see five to seven big 
systems emerging on the world mar- 

The proposed partnership between 
British Airways and American Airlines 
— giving those two carriers the lion’s 
share of traffic between London and the 
United States — is still in doubt. The 
U.S. Department of Transportation has 
asked the airlines to submit more ev- 
idence justifying the partnership, while 
the European Union is insisting that the 
airlines divest up to 400 of their airport 
slots to make room for rival operators. 

Robert Crandall, the head of Amer- 
ican Airlines, told shareholders recently 
that the earner may have to be content 

Airbus Bets Heavily on China 
In Bid to Bolster Sales in Asia 

Continued from Page 17 

inated , by’ the- Urifteri '.. States, and 

Europe:- - y y. 

• In retumfqr betteraccess. to Western 
aerospace technology,, know-how and' 
assured airworthiness ’ certification. 
China win contribute lower production 
costs and a large share, of the.estimated 
$1,7. billion to $2 billion, development 
cost erf. the -program. . ... 

China is also expected to be a major 
customer for the AE series of aircraft 
Singapore Technologies has estimated 
that potential global demand for the AE 
family could. amount to 2,000 to 3,000 
planes over.thenext 20 years.* V 1 . ■ " 
"We foresee a strong 

A319 Range Capability 

the {growing regional aircraft rtuirket._ 

■ JuanDe Uriarte. Airbus Industrie Asia *; 

sepiiSr vice president for marketing, tola 

■ Avjatlon Week & Space Technology 
magazine recently. “We need to idl J 
gapTat the. bonom of Airbus's product 

■ range, and this is another good reason 
forlcbricluding the agreement. " 

; Be saidthat the primary goal ot the 
. joint. venture was to win a 30 per^nt 
share of die global market for am i.wt m 
ih£i70-seat to 150- seat das*. 

' That marker is forecast to grow to 
about 5,40a.plahes over a 20-year peri- 
od] Mr. De Uriarte added. 

itor of the InierntUional Hern hi 
Tribune. . . 

with a simple code-sharing arrangement 
with British Airways rather than the 
proposed formal arrangement, which 
would have enabled the airlines to com- - 
bine their frequent flier programs, pool 
revenues and, coordinate-. schedules. ' 
This would be bad news for British 
Airways, which sold its interest, in 
USAir for what seemed to be a much 
broader access to the U.S. domestic 
market in partnership with American. 

The United States started allowing 
code-sharing on domestic routes in the 
1980s. and later allowed American car- - 

■ . rVivtfScfc'r.'fHT- 

i • 

riers to conclude similar agreements 
with foreign airlines as a way of getting 
around the restrictions imposed by most 
governments. . j \ ......... 

One major iegathurdle, though, was - 
thru under U.S. lavv.companies-are not- 
supposed to collude to fixprices or' 
schedules, which- is implicit in some of 
the partnership arrangements.. ■. The 
United States: therefore, offered anti- 
trust immunity to airlines in countries 
which agreed to conclude “open skies” 
deals allowing free reciprocal access to' 
American carriers: 

7 he fnnkr. circles show the A3.19‘s basic range of 1.900 nautical miles with a 
full payload of 124 passengers and baggage. The.outer circles represent a 
range of 2. 700-nauticat miles for an A319 with extra fuel tanks. 

lul-.-rr.jtK i. it lt-i il l Ti iNn..- 

So Far, U.S. the Winner in Asia ‘Open Skies 9 Pacts 

By Michael Richardson 

S INGAPORE — A spreading 
patchwork quilt of "open 
skies" agreements finalized- be : 
tween the United States and 
Asia-Pacific countries since April is of- 
fering passengers the prospect of more 
services at lower prices in the world's 
fastest growing aviation market. 

The agreements between the United 
States and Singapore, Taiwan. New 
Zealand and Brunei remove govern- 
ment regulations on routing, capacity, 
frequency, pricing and code-sharing in 
commercial aviation between and be- 
yond the signatory countries for the 
airlines of those countries. They apply 

to both passenger and cargo services.' 
U.S. officials say they are negotiating 
similar bilateral' accords with Malaysia 
and South Korea. . 

But analysts say: it may take years for 
the new aviation arrangements to spread 
throughout the Asia-Pacific region, 
eventually merging into a wider mul- 
tilaterai accord. . 

Until they do, the United States 
stands to gain most from the "open 
skies” accords ir has initiated because 
American airlines. can draw far more 
passengers from their huge domestic 
market titan any of the Asia-Pacific car- 
riers can draw from their home mar- 

Under the agreements, restrictions on 
international services are lifted but for- 

eign carriers are not allowed to operate 
within the U.S. market, .which alone 
accounts for about 30 percent by value 
of .the global passenger market 

Colin Gibson, publisher and exec- ' 
utive editor or, Asian Aviation.- 
magazine, said that countries that were 
willing to negotiate open skies agree- 
ments with the United States either had 
competitive airlines and/or govern- 
ments that gave, priority to promoting 
tourism, business travd and air freight 
.efficiency over the protection of local 

Jenny Shipley, transport minister of 
New Zealand, which agreed to the text 
of an open .skies accord with the United 
States on May 29. said that the agree- 
ment “has the potential to increase tour- 

ism to this country from the U.S. as New 
Zealand airlines take up opportunities to 
fly to more cities in the U.S." 

. Cheong Choong Kong, deputy chair- 
man of Singapore Airlines, said that 
although the signing by several Asu- 
Papific: countries of open skies accords 
wifh die United States had no immediate 
Impact, it was a first step that could have 
great loHg-term significance. 

".The point to note is that all these 
agreements have one common ingredi- 
ent. which is the United Stales.' ‘ lie said. 
.“Until, the countries — let's *a\ 
Taiwan. Korea. Malaysia and Singapore 
— i have open skies agreements .iniong 
themselves, the U.S. is realty die vnty 
beneficiary because it would" be able ti* 
fly, freely among these countries." 

"■ ".'A - '. — /5»- *$< SI 3/4 lit -V**" • ■ • 


*-■ & .. , ■ T'"" .,••• 

~ ^ ; We connect you with your _ : 

and aerospace customers* ^ j 

Bets Heavily ■« . ~ ~ 

1,1 Bolster Sale, ' 2 Manuf acturing Giants 

"''H Reassess Business Ties 



PAGE 19 

Continued from Page 17 ~ 

the merger was Ihe result of "a long- 
jasdrig strategy" to limit Airbus In- 
dustrie to that of a niche player with a 
Jong-term view to eliminate it. 

"It is a project aimed at suppressing 
what has always been consiclered by 
some in the USA as an anomaly: real 
competition, a real alternative to an 
American monopoly in the aerospace 

Mr. Woodard said he was confident 
Boeing would win American and Euro- 
pean approval for the merger, and 
warned that "major trade friction ’ * over 
the issue would hurt workers on both 

M R. PIERSON said Boeing 
was attempting to “undo 
more than 25 years of joint 
European efforts againsr 
American hegemonic will, known as 
monopoly.’ ’.To counter such criticism, 
Boeing has been stressing its interna- 
tional credentials. Mr. Woodard kept 
reiterating that Boeing had man y cus- 
tomers and partners in Europe, includ- 
ing an exclusive deal with Snecma of 
France to supply engines to the 737 
family, a deal that will be worth some $7 
billion in sales by 2005. Mr. Woodard 
said orders for the new 737 series would 
provide 11,000 jobs in France. 

“It is interesting to note that no one in 
Europe has ever objected to this ex- 
clusive contract," he said. He added 
that Rolls Royce PLC will , make $9.2 
billion in sales of engines for Boeing 
aircraft,- accounting for two thirds of its 

‘ 'Aerospace truly is a global business 
that we all have a stake in.' ' he said. 

On a visit to Europe earlier this year, 
Boeing’s chairman, Philip Condit, said aims to shed its American 
image and present itself as a local or- 
ganization in the countries in which it 
does business. Mr. Condit said the mer- 
ger with McDonnell Douglas would re- 
duce Boeing’s dependence on its home 
town of Seattle and set the stage for 
internal expansion through joint ven- 

At the same time. Airbus Industrie is 
becoming more American, reflecting its 
growing business in North America and 

6 Open Sk it 

? • •• 

the reality that, depending on engine 
choice, up to 40 percent of an Airbus 
airliner is made in the United States. 

Mr. Condit said Boeing would seek to 
establish more binding arrangements 
with the airlines, creating industrial 
partnerships rather than traditional 
seller/customer relationships. 

"We are exploring very seriously 

where the boundaries between the op- 
CTators and the manufacturers are and 
looking for areas where we can provide 
more value," Mr. Woodard said on an 
earlier occasion. "There may be things 
we do that our customers should do, and 
there may be things our customers do 
that we should do.’’ 

Airbus officials said on the other 
hand that the consortium would never 
contemplate signing exclusive deals 
with its airline partners. 

At the same time, Boeing says it will 
establish closer relationships with its 
suppliers, who account for about 50 
percent of the value of every aircraft 
sold. Analysts said thev will become 
more intimately involved in the oper- 
ations of the airframe makers, with 
greater responsibility for producing 
complete subsystems. 

The Boeing official responsible for 
procurement, Gerry Kearns, said last 
year that the company's aim is to de- 
velop long-term strategic relationships 
with its suppliers. “Eventually, mem- 
bers of our extended enterprise will be 
aligned with the Boeing business plan," 
he told Aviation Week and Space Tech- 
nology magazine. 

While the Boeing takeover of Mc- 
Donnell Douglas will produce an es- 
sentially bipolar world in civilian air- 
craft manufacturing, this does not rule 
out a considerable amount of overlap 
between the two blocs. Boeing already 
buys sub-assemblies from some Airbus 
contractors, and one Airbus partner, 
•British Aerospace PLC, is discussing 
cooperation in the mili tary field with 

Mr. Condit said such developments 
were to be welcomed if it meant a more 
diversified and efficient supply chain. 

At the same time, the airframe man- 
ufacturers will be seeking ways to make 
their operations more flexible and ef- 
ficient Mr. Condit said studies had 
shown that the optimal production unit 
was about 1,500 persons, implying that 
divisions within the main enterprises 
will be given a certain amount of 
autonomy. Boeing experimented with 
this concept in setting up a separate unit 
under Mr. Condit to develop and pro- 
duce its 777 wide-bodied twin-jet 

Earlier this year, Boeing set up a unit 
called Boeing Enterprises to establish 
and direct new joint entities with the 
airlines. One of the first fruits of this 
policy was a joint venture with Flight- 
Safety International to train flight and 
cabin crews. 

Bodng’sstarexhibitattheair show is 
the next generation version of the 737 
family, aiming at the market segment 
that is expected to account for 60 per- 
cent of total sales of planes of more than 

Will Airlines Ever Win 
The Cost - Cutting War? 

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acase. w** 

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Mhhrl Gdngllf / (K fctu-t Fijme-Pir- « 

Passengers in economy class often find increasingly meager amenities. 

100-seat capacity, or more than 1 1 ,000 
aircraft over the next 20 years. 

With the new design, Boeing aims to 
straddle the range between 100 and 190 
seats, with shorter production times and 
a large degree of commonality to reduce 
retraining of pilots and simplify main- 
tenance. Boeing says it took a record 
500 orders for the’aircraft before the 
first one rolled out of the factory last 
December. “This airplane is our defin- 
ition of value," Mr. Woodard said. 

But the aircraft is hotly challenged by 
the Airbus A319, also making its first 
appearance at the air show. 

O NE question of vital concern 
to whether Boeing will con- 
tinue to produce the McDon- 
nell Douglas MD-90 and 
DC 1 0 models, which account for nearly 
a quarter of the current fleet in Europe. 
Finn air, a loyal McDonnell Douglas 
customer, last week announced that it 
was going over to Airbus. Mr. Woodard 
said Boeing did not know what it would 

do with ihe McDonnell Douglas range 
because it cannot have details of how 
the aircraft are produced and ai what 
cost until the merger goes through. 

The European Commission contends 
that the $1 3.9 billion merger between 
Boeing and McDonnell Douglas poses a 
serious threat to fair competition in the 
aerospace market. 

According to the EU Statement of 
Objections, the merger will give Boeing 
dominance across the market for aircraft 
of mare than 100-seat capacity. The 
takeover of the McDonnell Douglas 
M90 range is expected to increase Boe- 
ing’s market share to 70 percent from 
the current 64 percent Boeing will also 
increase its production capabilities by 
taking over a skilled work force, pat- 
ents. licenses, know-how and access to 
capital, not to speak of research con- 
tracts given out by the Pentagon and 

BARRY JAMES is on the staff of the 
International Herald Tribune. 

Continued from Page 17 

turned to profit as the economy re- 
covered, earning about S14 billion toial 
in 1995 and 1996. Thousands of em- 
ployees who bad agreed to forgo pay 
raises or take cuts during the lean years, 
on the promise that they would be re- 
warded in better times, felt sure enough 
to demand ihe fruits of their sacrifice. 

“The two biggest costs have been the 
problem areas, noied Kevin Murphy, 
an airline analyst for the investment 
bank Morgan Stanley & Co. “Fuel is 
something you can't do anything about, 
and labor is being very feisty now. They 
want more than inflation would dictate. 
With the two biggest cost components 
being troublesome in the last year, it 
only puts pressure on management to 
reduce costs in other areas." 

One of those areas is the planes them- 

“In 1992, we said we were going to 
build airplanes for the same price 
through 1998." said Dick Kenny, a 
spokesman for Boeing Co., which 
makes about 60 percent of all big com- 
mercial jets. "That was a direct re- 
sponse to customers saying we've got to 
reduce the price. There aren't that many 
gains to be got as there were, therefore 
greater manufacturing efficiencies have 
risen to the top of the agenda." 

That meant Boeing had to make re- 
ductions of its own: “We had to put in a 
major program to cut costs and bring the 
price of an airplane- and of ownership of 
an airplane, down." 

The need to reduce costs may have 
been particularly acute at the depth of 
the airline recession, but it has always 
been a fix mre of the aerospace busi- 

"It is a trend that manufacturers have 
been addressing for as long as I can 
remember: to reduce the cost of own- 
ership either through more efficient en- 
gines. more efficient systems, using a 
ovo- man crew instead of a three-man 
crew," Mr. Kenny said. “There have 
been fuel and productivity gains since 
the stan of the jet age. That’s why the 
price of an airplane ticket is such a 

The passenger who suffered the 
string of mishaps did not find his flight 
to be such a bargain. Ticket prices are 
far lower in real terms than in the past, 
but cost-conscious airlines have made 
most fliers pay by offering increasingly 
meager amenities. 

“They've significantly improved 
service in the front 6f the plane and 
made it significantly worse in back; 
almost all attention to service has been 
in first and business class,’ * observed Ed 

Perkins, editor of Consumer Reports 
Travel Letter. "The economy-class air- 
line sear has become a commodify. It's 
priced like a commodify and it's pro- 
duced like a commodity. When United, 
American or British Airways say, ‘We 
will not be undersold by VaiuJet or 
Southwest or Easy Jet,' they’re saying, 
*We're no better than they are.' “ 

That is not the son of message they 
would like to convey. In any case, the 
cheap airlines will always be cheaper 
operators, so with business picking up. 
the larger carriers are having a rethink. 
Mr. Peikins cited a new ad campaign by 
United, in which it concedes that some 
passengers find its service disappoint- 

"Thev usually show you how happy 
they a re]" he noted. "This represents a 
significant departure. It takes guts to do. 
Lf they come out with that and don't 
follow* up. or just make cosmetic 
changes, it will have a bad effect. 1 see 
this United move as indicating that a few 
airlines may be taking a second look at 
the back of the plane and saying. ‘We 
have a pretty baa product back there.' " 

S OME airlines, notably Eva Air 
of Taiwan, have introduced a 
“premium economy" service, 
with wider seats and more room 
between them, for 30 percent to 40 
percent more than deeply discounted 
coach fares, he noted. 

If airlines stan adding back frills, it 
could put pressure on costs. Bui the 
persistent presence of cheap operators 
should keep a lid on any increase in the 
U.S. market. In Asia. too. competition is 
becoming ever more fierce, as Amer- 
ican carriers go up against national and 
regional operators. 

The least promising outlook for cost 
control is in Europe, where “there are 
bureaucracies and the unions are more 
embedded.” Mr. Murphy said. By some 
measures. European airlines can be 
twice as expensive to operate as U.S. 

The bank's researchers expect unit 
costs worldwide to be relatively fiat this 
year and next, helped by an expected 7 
percent drop in fuel costs this year. But 
for lower operating costs to become a 
lasting feature, the analyst said, the key 
is the~industry’s relations with its em- 

‘‘The best of all worlds would be to 
get labor on board and augment what 
productivity gains technology gives 
you," he argued. “That would come 
back to labor in terms of more grow th 
and job opportunities.” 

CONRAD DE AENLLE writes alma 
business and investment from London. 


Tale of a Triathlete: 
Pedaling Hard at 82 

By Ian Thomsen 

InternutiutMl Herald Tribune 

WINDSOR, England — The 82 - 
year-old triathleie looked out through 
the window and said, * ‘I had better tend 
to my bike." 

He tried to stand up. He pushed him- 
self up again and was almost vertical 
before crashing down with a bounce 
onto the hotel sofa. This was Saturday, 
the day before the race. Finally, he made 
it onto his feeL 

The next morning, he was out on the 
course, doing what most of us would 
never want to try. Patrick Barnes, bom 
March 26. 1915 — "at the time of 
Gallipoli." he said, because he is an 
Englishman — came out of the Thames 
early Sunday in a black seolish wet suit 
that" swelled around his middle. The 
clock was running faster than be was. 
But then, what was his hurry? 

“My only goal is to finish," he 

The wet suit came off him like a 
stubborn banana peel. He pulled a T- 
shirt over his whitened head, and then a 
helmet with quite a few nicks, and he 
escorted his waiting bicycle across a 
small fenced-in park while people 
clapped, smiling at the sight of him. 

He did a 750-meter swim, a 25-ki- 
lometer bike ride and a 5-kilometer run 
— a “sprint" or miniature triathlon — 
in three hours, 26 minutes and 31 
seconds. Last year in the warm months 
he managed to do 13 triathlons, some- 
times one weekend after the other. 

"Well." he said, *Tve got so much 
ro do. so many things to do, that very 
often I sit back in my chair, read The 
Times and don't do any of them." 

He lost his driver's license after a car 
accident four years ago, and now he 
cycles everywhere, carrying his bike up 
and down the staircases of the London 
Tube, refusing to hurry. In April he ran 
rhe London marathon in nine hours. 

"I was walking most of it." he said, 
“By the end, you couldn't see there had 
been a marathon; it was all packed up 
and gone home." 

His First triathlon — undertaken on 
the advice of a doctor who wanted him 
to vary his exercise — was performed 
on a bicycle with a shopping basket. 

“That bike was 59 years old,” he 

The exercise for those of us who 
don't exercise was to decide Sunday 
morning how much Mr. Barnes had in 
common with Spencer Smith, the 24- 
year-old winner of the Pepsi Max Royal 
Windsor Triathlon. 

For one thing, they both come from 
the west side of London, not far from the 
queen's residence at Windsor, and they 
boib were cheered on and supported by 
the same audience — mainly the rela- 
tives and friends of the 850 athletes who 
jumped in the river and shooed the 
swans away for a few morning hours. 

It' is one of the bigger and better 
annual triathlons in Britain, and in three 
years its champion. Smith, may well 

become an Olympic gold medalist when 
the event makes its debut at Sydney. But 
the sport has not yet achieved arrogance. 
Afterwards, just past the finish line, 
anyone who wanted to could walk up to 
Smith, who has won three world cham- 
pionships. and shake his hand. 

Some of the tourists didn’t know 
what to make of any of it 

A woman standing in front of the 
McDonald's at the foot of die castle was 
lecturing a group of foreigners emo- 
tionally, leaning and waving: "This is 
one reason we have all of this history, 
it’s because we've never had a rev- 
olution like in France, like in Russia, it’s 
because we are a democracy, we love 
our freedom. OK? Let’s go on to the 

Her group then was nearly trampled 
by a half-dozen men charging up rhe hill 
in bathing tights. 

Smith estimates that the top triath- 
letes make upward of $400,000 a year 
from prize money and sponsorships. He 
is paid ro wear his swimsuit, running 
shoes and bicycle, as well as to endorse 
a health drink. 

Eight years ago. he was a swimmer, 
and he was bored with it Since taking 
up triathlon he has moved to Carlsbad, 
California, where he lives in a con- 
dominium overlooking the third tee at 
La Costa golf course. 

He also has a small place in Spain, 
and he seems to have a perpetual tan and 
a body tapered for his sport as if drawn 
up by a computer program. 

Last week he had an accident and 
tumbled off his bike, and after the 1 ,500- 
meter swim and the 40-kilometer bike 
ride, feeling stiff, he was in fifth place. 
But he made up the time quickly in the 
10-kilometer run — looping beneath the 
world’s largest inhabited castle and 
across the bridge to Eton College, where 
the future king has been learning his 
own ropes — to win easily in one hour, 
52 minutes and 52 seconds. 

Real Madrid 

L»UB-s9jAi ,, TbH tV« 

Mark Philippoussis returning a shot to Goran Ivanisevic, whom he beat on Sunday in the Queen’s Club final. 

Wimbledon Warm-Up for Philippoussis 

C.mipilnltn Ow Fn W I'tqvtrhrs 

The leading men's tennis players 
completed their first week of Wimble- 
don acclimatization on Sunday with 
grass-conn finals at the Queen's Club in 
London, where Mark Philippoussis won 
the battle of the big servers, and in Halle, 
Germany, where Yevgeni Kafelnikov 
won his fust title of the year. 

In London, Philippoussis beat Goran 
Ivanisevic. 7-5, 6-3. In a battle of two of 
the game’s biggest servers. Philip- 
poussis, an Australian, struck 15 aces 
and showed that he could be a true threat 
when Wimbledon begins on June 23. 

Ivanisevic, who has twice been the 
runner-up at Wimbledon, served 12 
aces in a match that offered little more 
than power-serving and took only 53 
minute to complete. 

Lions Track Down Scrum-Half 


DURBAN, South Africa — Kyran 
Bracken, the scrum-half for Eng- 
land’s rugby team, was summoned 
Sunday from his Caribbean vacation 
to join the British Lions in South 
Africa as the replacement for the in- 
jured Rob Howley of Wales. 

Howley dislocated his left shoulder 
during the Lions’ emphatic 42-12 vic- 
tory over Natal at Kings Park and will 
miss the rest of the South African 

Howley, one of the stars of the 
Lions' squad, had been a certain se- 
lection for the first test next week 
against South Africa in Cape Town. 

Bracken was on the first day of a 
vacation in Tobago. The Lions' se- 
lectors telephoned Mike Scott, ad- 
ministration manager of Bracken's 

club. Saracens, in London. Bracken 
had left no contact number, so Scott 
telephoned 13 hotels on Tobago be- 
fore he found Bracken, who becomes 
the third player from Saracens to 
come in as a 1997 Lions replace- 

The Saracens prop Paul Wallace 
replaced Ireland’s Peter Clohessy and 
Tony Diprose arrived in South Africa 
for the Welshman Scott Quinnell last 

Howley was set to fly back to Bri- 
tain on Sunday night, said a Lions 
spokesman. Bob Burrows. He is ex- 
pected to be out of the game for four 
months. . 

‘ ‘Obviously it’s very disappointing 
for Rob and also for the entire team, ’ ’ 
said Fran Cotton, the Lions' manager. 
“He’s a world-class player.” 

It was the third tournament that Pbil- 
ippoussis, 20, has won this season. 

“I definitely think I'm improving all 
the rime as 1 mature," Philippoussis 

There were only two break points in 
the match — in the 1 2th game of the first 
set and the eighth of the second — and 
Philippoussis, ranked No. 19 in die 
world, converted both. 

Philippoussis won the first set by 
breaking the Croatian ’s serve in the 12th 
game. Ivanisevic missed all but one of 
his first serves in the set. 

In the second set Philippoussis broke 
to lead 5-3 as he went on to win. 6-3. 

The longest rally came at 3-3 in the 
second set. 

After Philippoussis had served two 
powerful aces, Ivanisevic offered his 
racket to a ball girl. She took it and faced 
Philippoussis. who served a soft lob and 
played a gentle rally of 17 shots before 
gallantly losing die point. 

• In Halle, Germany. Kafelnikov 
fought off three match points to win a 
see-saw battle against Petr Korda of the 
Czech Republic. 

Kafelnikov, the top-seeded Russian, 
needed two hours ana 20 minutes to beat 
the Czech. 7-6 (7-2), 6-7 (5-7), 7-6 (9- 

Kafelnikov ran his record to 10-2 in 
tie-break sets this year in a match in 
which both players made some dazzling 
shots in crucial moments. 

The Russian, whose return of serve is 
one of bis strengths, saved the last match 
point at 6-7 in the tie-breaker when he 
slammed a sharp cross-court backhand 
that a lunging Korda could not touch. 
Kafelnikov served only seven aces 
while Korda served 28. 

Kafelnikov, ranked sixth in the 
world, has been lighting his way back to 
form after a broken finger sidelined him 
for three months earlier in the year. 

Korda, coming back from a serious 
groin injury, led 6-5 in the final set after 
breaking the Russian’s serve for the first 
time in the match. 

B ut Korda, whose layoff had dropped 
him to the ranking of 27th in the world, 
lost the following game with three 
double faults. 

The Czech player also pulled off the 
match’s most improbable shot at 5-5 
that helped him capture the second set 

Korda chased a Kafelnikov serve that 
curved far outside the court, then fired it 
around the net post into the comer for 
the winner. 

Kafelnikov attacked the net even on 
his second serve throughout the tour- 

En route to the final, the Russian also 
beat two former Wimbledon champi- 
ons, Boris Becker and Michael Stich of 

“The way Kafelnikov is playing sur- 
prises me," said Becker. “But if he's 
going to win Wimbledon, that’s how 
he’s going to have to do it" 

(AP, Reuters) 

■ Kuerten Falters in Bologna 

Gustavo Kuerten crumbled in rhe fi- 
nals of the Carisbo International clay- 
court tournament just a week after he 
had captured the French Open, losing on 
Sunday to I6th-ranked Felix Mantilla, 
The Associated Press reported from Bo- 

After winning the first set 6-4. the 
Brazilian quickly went- down, 2-6; i-6, 
to Mantilla, a Spaniard who was the 
second seed. 

Kuerten was 15th in the ATP ratings 
and seeded eighth in the tournament. 

“Iplayed very well, but I was favored 
by Kuerten’s fatigue, even though he 
was in a good mental state because be 
won Paris,” Mantilla said. 

To Capture 
Spanish Title 


Real Madrid secured its 27th Spanish 
league title with an impressive 3-1 vic- 
tory over the reigning champion. At-' 
letico Madrid. 

Real, which needed only a draw, ton. 
its neighbor apart with first-half go ah 

Wo«ipSocch . . 

from Raul Gonzalez and Fernando 
Hierro. Predrag Mijatovic added thrs 
third shortly after the break. 

Atletico’s coach. Radomir Antic, 
made a triple substitution after Mi- 
jatovic 's goal and was quickly rewarded 
with a goal from the former Real striker 
Juan Eduardo Esnaider. 

After the game. Lorenzo Sanz. the 
Red president, said that the club is near 
to an agreemenr with Jupp Heynckes. a 
German who coaches Tenerife, to- take 
over the team next season. 

Italy Pasquale Luiso scored twice on 
Sunday as Piacenza beat Cagliari 3-1 in 
a relegation play -off in Naples to keep 
its place in Serie. Cagliari will be de- 
moted and play in the second division 
for the first time since 1990. 

In the last round of Serie B matches 
Empoli beat Cremonese 1 -0 to finish top 
of the division, it will move up to Serie 
A as will Brescia, which beat Venezia 3* 
i , Lecce. 3-0 winner at Cesena, and Bari 
which beat Castel di Sangro. 

Germany Giovane Elber scored twice 
to lead VfB Stuttgart to a 2-0 victory over 
Cottbus Energie of the second division in 
the German Cup final Saturday. 

Stuttgart, fourth in the Bundesliga. 
will play in the European Cup Winners' 
Cup next season, handing tneir UEFA 
Cup place to 1860 Munich. 

copa America Argentina scored 
twice in the last five minutes to beat 
Chile. 2-0, in Cochabamba. Bolivia, in 
yet another uninspiring Group A game in 
the Copa America on Saturday. 

The 8,000 fans scattered around 
nearly empty stands had to endure a 
night of cold and dismal soccer in a 
group that has yet to provide an en- 
tertaining match. 

Argentina did not score until the 85th 
minute, when Sergio Bertiscored with a 
powerful low drive. Two minutes later. 
Marcelo Gallardo secured Argentina’s 
victory with a second goal . 

Ecuador also scored two late goals as it 
beat Paraguay, 2-0, in another Group A 
;ame in Cochabamba on Saturday. Wel- 
lington Sanchez opened the scoring in the 
71st minute and Ariel Graziani scored a 
second with just three minures left. 

world cup Poland breezed past 
Georgia, 4-1, in a European zone Group 
2 qualifier on Saturday. 

Poland fielded a reshaped squad in its 
first game under coach Krzysztof Paw- 
lak who took over from Antoni Piech- 
niczek after Poland's 2-0 loss to England 
ended its chances of reaching the finals. 

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Kansas City 














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100 100-4 

9 1 

Olcugnmu 000 020 000-2 S 0 

DAmico. OoJones l9l and Mathew: 
MulhoHand Rotas f7l. Potters on (81. 
BoltenfleW (9) and Servos. W— DAmico. 3- 
3. L— Mulhonand, 5 -a. Sv— DoJones USi. 
HP — Milwaukee. Js. Valentin (6). 

Kamos Cly 200 100 000-3 9 1 

Pittsburgh 002 on m-s ■ o 

Pittsley, Mk-WWIaim (a], R.Vem IT) and 
Macfaitane F .Cordova, Ruebel 17), 

M. WllMira (8), Lorselle i9) and Kendall 

W-F. Cordova. 5-4. L-Mk-Willlams. 0-2. 
Sv— LdseJIe 16). HRs — Kansas Cihr. King 
<91. Piltebuigto Womack (31. Rondo (5>. 
Chicago (AL) 100 002 000-2 3 0 

Ctnclnati 000 000 010-1 7 0 

Alvarez, R. Hernandez (B) and Fabreqas: 
SchaureK SuHhron C7). Belinda 19) and J. 
Oliver, Taubense* 19). W— Alvarez, *4. 
L— Sctraurek, 5-5. Sv— R. Hernandez (13). 
HR&— Chicago. Durham (4). Belle (15). 
Baltimore OH 004 000-4 8 0 

Atlanta OH OH 120-3 7 0 

Key, A. Benllez (71, Orosco (8). Ro-Myere 
(9) Hailes and Webster (9); GAIaddux. 
Embree (B). Clonlz (9] and Edd-Perez. 
V7— kev. 11-1. L-G. Maddux, 7-3. 
Sv— RaMyere (21). HRs— ArtanhkChJones 
(8). Edd.Perrz (21. 

Boston OH 032 012-8 11 0 

Hew York (ML) 1H IH 101-4 12 0 
Suppan. Wflsdln (6). Hammond (SI. 
Slocum 0 (9). Hudson (91. Lacy (9) and 
Haltebem, Haselman (7); P-Reed, Manuel 
(7), R. Jordan (8), Lldlc (d) and Hundley. 
W— Suppan, 1-0. L—R Reed, 4-4 Sv— Lacy 
12). HRs — Boston, M. Vaughn 1 20). 
lb. Valentin 15). DLeary ft). New Yoik. 
Everett 2 (7). Hundlcv ((5), Ochoa (II. 
Toronto OH 110 Hi— 3 10 1 

Philadelphia OH 001 2U-4 7 a 

W.wanms, Spaionc (6). Quantrill (7). 
Plesoc 1 7) and B Santiago: Schilling. Gomes 
(7), Spradlin [ft. Planted berg (8). Botialfco (ft 
and Lieberthal. W— Gomes. 14. L— Spo-Qoric, 
(KLSv— Sortdka il4l.HR— T. R Perez 111. 
Minnesota 020 200 220-8 10 0 
Houston HI HO 000-1 6 2 

Raflk& Trombley (9) and Steinbadv Wall 
Lima (6), Minor (8) and Ausmus.W— Radke. 
4-S. L-WalL 2-3. HRs— Minnesota MoDtor 
(3). Houston Bagwell 120). 

Do trail OH 010 101—3 8 0 

Montreal 103 OH 00x— 4 18 0 

OOvam. M. Myers 171 and B Johnson; 
CPerez, Telford (8), Urbina (8) and Fletcher, 
w— C Perez. 7-4. L-OGvaras. 4-5. 
5 v— Urbina (ilk HR— Montreal, 
H.Rodrtguez <121. 

N. Yam (AL) HO 001 HO 008-1 5 0 
Florida HO OH 001 HI— 2 6 0 

Cone, Nehon (10), Mecir (121 and Gfrardt 
A-Lerter, Powell (8), Hen 191, Stanrter (10). 
F.Heiedla <101, Hutton (121, Cook (12) and 
C-Johnson. W— Cock, I -0. L— Medr, 0-4. 

Son Francisco 0)0 021 100—5 14 1 

Texas 2H 020 011—6 10 I 

Esles. Tovarei [7], Poole (8), D. Henry (8), 
Beck I87, R.Rodriguez (91 and R.IM1M1&; 
k\HiH Gunderson 17), WeJMand (9) and I. 
Rodnguez. W— Wetteland, 4-0. L— R. 

Rodriguez. 2-2. HRs— 5an Frandeca Bonita 
021. Snow (31. Texas. Gnwr 2 (9), 
Ju Gonzalez (13). 

Colorado 801 OH 0H-1 4 0 

Seattle IH 011 3B*-4 7 1 

Wright Burke 17), McCurry (7) and 
Mcnwarirtg; Ro Johnson S .Sanders [ft and 
Da.witaon, w— RaJotason. 10-1. 
L— Wright 4-4. HRs— Cobra da, EtYoung 
(31. Seattle, E -Martinez (8), RDavis (8). 

Los Angeles 200 HO 022—6 11 0 

Oakland OH 040 000-4 8 1 

Astocla. Hall (8), Ta-Woirell (91 and Prince; 
Karsay, A4moU (8), □. Johnson (91, Mohler 
[ft and Go Williams. W— Hal 1-2. L— A. 
Small. 5-3. Sv— Ta.WarreU (151. HR— Los 
Angeles, Kanos (10). 

Ufego 100 102 030 OH 01 — 8 16 2 

An ah. 320 200 NO 090 00—7 11 1 

(14 innings) 

Cunnarre. P. Smith (4). Hoffman (9), 
Boditler (12). TLWarrell (14) and Flaheny. 
C. Hernandez (8). D-Sprinqer, Haltz (7), 

James (8). P. Harris (81. Perctval (10), 
DeLuda (11), Hasegawa (14) and Kreuter, 
LeyrttZ <1»> W-flochttcr, 1-2. 
L— Hasegawa 1-4. Sv— n.worrefl (2). 
HRs— San Dlega Joyner (6). G. Vaughn (ft. 

Boston OH HI 010—2 3 0 

New Yor* (NL) 810 030 Olx-5 11 1 

Wakefidd, Wasdin <5). Brandenbuig (6). 
Hudson (8). Slocumb (Sj ana Haselman; 
M.Oark, McMlchael (8), Jo. Franco (9) and 
Hundley. W— M. Oar*. (M. L-Wakefield, 2- 
A Sv-JoJ=ranco (17). HR— New York, 
NLGart. (1). 

Cleveland OH HO 350—8 14 8 

St. Leals 010 200 Doa— 2 7 2 

1st game 

Colon. Assenmocfter (5), A Lopez (6), 
M orman (ft. Shuey (9) and SAkHnar; 

ArLBenes, TJJlAathem (8), Passes (8), 
Fiascatore >8), Beltran (9) and Dltetlce. 
W— A. Lopez. 3-4. L — TJ-MoItrewfc 2-3. 
HR-St.Louh, Mabry (4). 

Cleveland OH 100 801-2 5 0 

St. Lords 010 011 201-5 11 0 

2nd game 

Ogea. Assenmacher (6). A.Lopez (6). 
Merman (7), Mesa (8) and Barriers Morris. 
E ckets ley (9) and Lcmpkin. w— Morris, 5-1 
L— Ogea. 5-6. Sv— Eeketsley (13). 
HRs— Cleveland, Thome (18). 51. Louis, 
Mabry 15). 

Minnesota 200 OH 848-4 12 1 

Houston in OH 0H-1 9 0 

Robertson. Fr.Rodnguez (7). Trombley (8) 
and G. Myers Kile, R -Springer (8), Minor (81 
ond Eusebio. W—Robertsoa 7-3 L— Wle,7- 
1 HRs— Minnesota. Lawton (4). Houston. 
Biggie (12). 

Baltimore OH 801 210 002-6 10 8 

Atlanta 110 Hi 010 000-4 a 1 

(12 Innings) iMussino, TeJAothews. 17J, 
Orosco (8), A. Benitez (8), Rhodes (91, 
RaMyets (12) ond Holies. Webster [12i 
Kansas aty Hi 004 012— 8 11 0 

Pittsburgh OH 3H 000-3 8 1 

Belcher, MX. Wiliams (8), Cation (8). J. 
Montgomery (81 and Fasona- Ueber, Peters. 
(6), Sodnwsky (ft. Rincon (ft and Kendall. 
W— Belcher, B-6. L — Ueber, 3-8. 5v— J. 
Montgameiy (1). HRs— Kansas City, King 2 
(11), Fasano (11. 

Toronto IH OH 200-3 7 0 

PhOaiMphlo OH HI 100-2 B < 

Person, Spofenc f7), Quantrill (B) and B. 
Santiago; Nye, Gomes (ft. Spradlin (9) and 
Ueberihot Parent (*). W— Parson, 2-4. 
L— Nye, 0-2. Sv— Quantrill (4). 

HRs— Toronto. Carter (81. Philadelphia, 

Daulton (7). 

Detroit OH OH 000-0 3 1 

Montreal HO IH OOx— 1 6 3 

Ju.Thompson. Bracall (8) ana Casanova' 
PJ-Mcrttnez and Fletcher. W— PjJWorflncz. 
9-2. L— Ju.ThampSOiV 6-5. 

Chicago (AL) OH HO 001—1 7 1 

Gndnati HI 110 2Qx— 5 9 0 

□.Darwin. McElroy (7), Simas (7), T. 
Castilla (Bland Fabregav Mercker, Shaw (9) 
and J. Oliver. W— Mercker, 4-s. L— D. 
Daiwta 2-4. HR— Cincinnati W .Greene (8). 
Miwaukee IH 110 208-5 10 1 

Chicago [NU Mi 030 Mx— 9 14 2 

Knrt, Ftarie (5). Fatter* (7). VBIone (8) and 

Levis. Stinnett (Bl; TrochseL BotteMieM (7), 
Patterson (7). Wendell (7) and Servo is. 
W— TrochseL 4-S. L-Kart 2-8. Sv— Wendell 
£2). HRs — Milwaukee. BumHz (7). Chkoga 
Orie (2). 

Colorado 013 OH 102—7 9 2 

Oakland OH OH 810—1 8 1 

R-Balley and Mamroring; Wengert C 
Reyes (7) and Go.Wllftant*. W— R. Bailey. 7 
5. I — Wengert 3-1 HRs-Cotoroda L 
Walker (19), Galarraga (18), Burks (15). 

Us Angeles OH 220 318-8 II 0 

Seattle M3 012 001-9 II 1 

RJAarttnez. Condlottl (SI, Radinsky (7), 
Qsuna (9) and Piazza; Wolcott B. Wells ft), 
Chariton C71. Ayato (8) and Da.WIban. 
W— Ayala, 4-2. L— Osuna, 1-3. HRs-Los 
Angeles, Plana 112). Karras 2 (12). Seattle. 
Griffey Jr (27), E. Martinez (9), Sorrento (9), 
R. Davis t9). 

Son Diego Hi 140 009—6 '9 0 

Texas HI in IQx-8 8 1 

DnJockson, Erdos (6). Batchelor (ft and 
Ftohorty; Soriana WMtesIde (5). VAnberg 
ft). Patterson (7), Wetteland (9) and 
1. Rodriguez. W-WWtesWa. 14). 

L-OnJockson, 1-3. Sv— Wattekind H4). 
HRs— Texas, Simms (4). Palmer (61. 

San Francisco 051 183 009-T0 10 1 

Anaheim 010 001 100— 3 14 2 

Roa, R. Rodriguez (6), Tovaraz (81, Poole 
(9) and Berryhllk Watson, Hasegawc (4), 
Perisho (8) and Loyritz. W— Roa, 2-4. 
L— Watson, 5-4. HRs— San Francisco. 

□.Hamilton m, Aurika Q). Kent 2 (14). 
A no helm. Edmonds (12). 

Japanese Leagues 
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Y*uH 11, Yokohama 2 
Hiroshima 4, Yomluri 3 

Yokohama & Yakult 3 
YOtrtiuri 6, Hiroshinia 5 
Hanshln i Chunktn 4 


Scott McCa mm 
Craig Parry 
Jeff Sluman 
Loren Roberts 
Kelly Gibson 
Dovta Love III 
Fuzzy Zoeiler 
John Cook 
Chris Perry 
Jose Maria Okxzabal 
Tiger Woods 
Nick Faldo 
Frank N0M0 
Fred Funk 
Stove E&bigton 
David White 
Lee Westwood 
Mark McNulty 
Nkk Price 
Bradley Hughes 
Sieve Jones 
Shrari Appleby 
PhB Mlckelson 
darefice Rose 
Scott Dunlap 
Work O’Meara 
Rodney Bftclrtr 
OavW Duval 
Payne Stewart 
Sieve Strieker 
Tom Watson 
Grant Watte 
Paul Brood hurst 
Edward Fryatt 
Peter Teravalnen 
Paul Azinger 
Duffy Waldorf 
Fred Couples 
Paul Go yd as 
Jack NldOaus 
Hate Irwin 
Justin Leonard 
Darren Cta rhe 
Ctvta Smith 
Lee Jonzen 
Larry Mize 
John Morse 
Andrew Co Itort 
Thomas B|oni 
Stephen Ames 
Dannie Hammond 
Bind Faxon 
Greg Kraft 
Slade Adams 
Bon Crenshaw 
Mike Hubert 

73- 71-69 — 213 

69- 72-73-213 

70- 7371-214 

71- 71-72-214 

68- 7373-214 

74- 67-73—214 

72- 74-69—21 5 

75- 68-72—215 

70- 77-73-215 

71- 71-73—215 

7370- 71—216 

71- 7370-216 

72- 71-73—716 

73- 74-70-217 

74- 73-70—21 7 

71- 7373-217 
66-7375— 217 

72- 74-73— 21 B 
72-74-72— 21 B 

71- 7374-218 

72- 72-74-218 

71- 7373-219 

75- 72-72-219 

7371- 75-219 

70- 7376—219 

69- 7378-219 

72- 7373-220 

72- 7375—220 

70- 74-76—220 

71- 74-76-221 

71- 7373—22) 

73- 7375-22) 

72- 74.76-222 
71 -74-78—223 

73- 74-76-223 




Sri Lanka 223 and 152 
West Indies: 189 and TB9-4. 

West Indies won by 6 wickets and lead 1-0 
3matoii series. 

Australia; 220-8 dec 
Leicestershire; 62-4 
Rain stopped play. 




Salomon Islands 4. Tahiti 1 
Australia S, TohHIO 

STANDINGS: Australia 6 points; Solomon 
Islands 1- Tahiti a . 

FQ1 3 Papua New Guinea 1 
standings: New Zealand 6 paints Fip 
3- Papua New Guinea 3. 


Kyrgyzstan t, Maldives 0 
Irani Syria 2 


Yemen 1, Indonesia I 


Poland 4 Georgia 1 

STANDINGS: Italy 16 points; England 15; 
Poland 7: Georgia 3 Mtttiavo 0. 

Japan 1, Turkey 0 
final standings: Japan 
Croatia 1; Turkey 1. 

Mozambique 3 Tanzania 0 
standings: Mozambique 4 pakrto 
Zambia 3- Namibia T; Malawi 1; Tanzania 1. 

Colorado 3 New York-New Jersey 2 
Washington D.C. 1, New England 0 
STANDINGS: Eastern Conference: DC. 
24 New England 21; Coiombvs 14; Tampa 
Bay 16; NY-NJ IX Western Gwferen* 
Kansas City 2<k Cotorodd 16 DaBas IS. So 
Jose ft Los Angeles 7. ^ 

-Mian’s Plea: S 






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Perry Porker 









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Randy Wylht 


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Jimmy Green 








Marco Dawson 



Torn Kite 

756062— 226 

Oita 7, L-atte 1 
Seibu 11, Nippon Ham 8 
Klnletou 13 Dftel 11 


Nippon Ham 3 Sefeu 2 
Dale! 1 1, Kiptelsu 6 

US Open 


Uraded ecora* Sunday eft* third round of 
the 87th IkS. Open on the 7,21 3y rad, ptr-7D 
Congressional Country aub courea In 

63 76-67-208 

7069-71— 21 p 

Tom Lehman 
Jell Magged 
Emle Els 

Colin Montgomerie 
Tommy Todes 
David Ogrin 
BDIy Andrade 
Jim Furyk 
Oita Browne 
Hal Sutton 
bul Stonkwwhi 

Jock Ferenz 72-7380—227 

Sapporo Tokyti Open ' 

Leading Anal seorH Sunday m the 100 
million yen (5877,000) Sapporo Tokyu Open 
golf Uumemant m It» 6^43ya^j (8J24- 
metort, par-72 Sapporo Kakusai Country 
Club ecuw at Sapporo, Japan: 

Htrofuirtt Mime, Jap. 67.706372—275 

HajlmeMeslikA Jap- 71-7069.78-280 

Y.SakamotaJop. 72-736967— 281 

T. NakaHma Jop- 72-71-7169—283 

Carte Franco, Para. 7864-70-n— 383 

T. Fukuzowa, Jop. 72-73-6372—283 

FfOrikrfAAinoza PhIL 726867-76—283 

N."Joe”OzakL Jap. 70-72-7369-384 

SdtMhI HlgaBlA Jop. 7169-70-74-284 

K. Miyamoto, Jap- 726769-76—284 

New Zealand 71, F1 |ls 

Natal Sharks 12 British Lions 42 


Ecuador Z. Paraguay 0 
Argentina 2 Chile 0 

standings] Argentina- 4 pain Is 

Ecuador 4i ParoguoySChlleO. 
croup c 

Brazil & Casta Rlea 0 
Mexico 3 Columbia l 

STANDINGS: Brazfl 3 p Dirts; Mexico 1- 
Colombia Ct Costa Rica 0. 


VfB stuttgoii Z Cottbus Energie 0 

. «XEaf-Mo*fflruui cup 

Stavio Prague 1. Dukia PragueO 


Real Madrid 3 Attettco Madrid l 



Piacenza icogltoni 
Piacenza stays In fcs dMcion. 

Aalborg 0, FC Copenhagen I 
Aarhus 3 AB 1 
Herfoeige 1. Brondby 2 
H viduvre 4. Odense 3 
Lynqby l, Veje 1 
Viborg ft Sttaeborg 2 

st and , ng& Brondby 68 punts; 
VefleSd; Aamus52j HoftoeigoS2jAoll»rt47, 
SilkcbMBdS. Oden* 41; FC Copenhagen 41; 
Lyngby 4ft ab 3ft Wborg 2 9s H vfdom 26 . 

umvereitatea Craiova 2, Fanil Constortta 3 
Chindia Tlrgairiste ), Stenra Bucharest 4 
Dinamo Bucharest 3 F.C. Brasov t 

Unteeraltatea aul ft FCM Bomu 2 

National Budior. 3 Ceahtoul P krtro NeomtO 
Sportul SludentneO,OtelulGalaa2 

Dado Pileatt 2, Gloria BbtrttoO 
JtolPehwani a F.C. Petrolul Ptolesfl i 
Pdfftennico Timisoara 1, Rpald Bucharest 2 
FDUL ST4MDMOS: Steauo Bucharest 
73 prwrts, F.C. National Bucharest 6ft Q|. 
rtamo Bucharest 59; Otehrl Gotoli 5ft FCM 
Bacnu 5i Cectttoui Piatra Neomt S2i FC. 
Arges Dado Piteft 5ft Rapid Bucharest 4ft 
F.C. Petrolul PMestt4ft F.C. Fa nil Constanta 
4ft Untvarsttatoa Crotava 43; Spartvl Stu den- 
tec 4ft Gloria Bbtrtta 41; j|ul Petrosa nl 41; 
Urtwreitotea Out 39r F.C Ch India Tlrgovlste 
38s PaUtebnka TlmSoara 3S F.C Brasov 33 


Yevgeny Kateinikov (1), Russia dei Boris 
Becker (4), Germ nay, 33 6-4 
Petr Korda (81, Czech Republic def. Paul 
Haarhuta Netfteftanda, 76 (7-5L 6-4. 


Kateinikov def. Korda 76 {7-21.37 (5-71,74 




Marie PhffippouMtt (6), Austrafla del Jonas 
Biofknran <B), Sweden, 26, 76 (7-SL 31 
Gartm Ivanisevic Or. Croatia det Greg 
Rusedski lift, Britain. 46. 34, 76 (20-181. 

Philippoussis def. Ivanisevic 76, 31 



Gustavo Kuerten (8), Brazft dot Maw 
Mortem, Italy, 31, 32 . 

Feta MantfOa (2j. span, del-KaiftffiteMi 
l«, Marocca 33 32. * 

HNAL . ...r*_ 

Mantilla def. Kuerten 46. 32 3V. 

i fV 

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rr: ;■ ,r ; Vfr; V 

• r. . '.Mr yi| 

Vi.«1W. riFfttL, « 

<• rr .■** :.V wjuen. 

: A jv -vtejjj-’pi 

t Trrcri 

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i k-SA *ndr 

rrtrTrx rr 
•s'nft ' fir; Ntr* 

*"?• fii-.uxk-rl t\ M 

■ r- ‘A i'TC » 

. L* :W. Hi iisL. 
iv.a: vl.'y i^pcni isli 

Minnesota— S igned RHP. Mott cwte 
OF DeShawn Southward and UJP As* 1 

Miner . 

Toronto— A greed to terms » 
Miehaei Young and LHP Ronald Bo* 

. TOftONTO -Agreed to terms wWilWElK 

Lorenz and LHP Tim Huff. 


Williamson and RHP Wesley Stombo. 

M oust on -Put RHP Shone fiepri** 
ISritoy disabled fist retroadtee » Ja ne 18 
Signed LHP Don Thomas ond RHP Jo®* 
Waflooe and assigned them to AUtaftt- "*r 
Yark-PennL = 

landswuitti to Albuquerque, the PCL 
coued OF Itorlm Garcto tram ABwqtitaV 6 '' 
usxmuui . 


NBA— Fined Chtaogo Bu8s f Den* W 
man $50800 for SiateflMtjta on IwfWJJ 
occasions concerning Marmdn popvWl»N 
Soft Lake City. 



CALGARY FLAMES— Started a letwof ta*® 

to buy the Calgary Hitmen of tne wesfe^ 
Hackery League. 

Carolina -extended corrtrtids 
Maurice, coach and Tan Webster. Ro™ 
LndouDBw md Stew Weeks, ossw* 

FLORIDA -Baughto M*e Lnittahearw* 1 

TorortoMapteLtaiafdrD PerGwtoftM^ 
coach. Srgrwd C Jim MontwnW*'’*’™ 
cantracf. , 

Pittsburgh -Named tom 

conuai .J< 


womem basketball oooete ^ 

WARTBURS-Named Dicta Pn Ml aan 


lbf Safi** Mtwi* 


fcypy't /^g fTf^-r* 
xT*,w. •r.:' - ‘. ■ . /. 

WSr— *• 

Real Madrid — 

Rouu Ati t(i| ' Orioles Master Braves 
s'! ui * lu ' e ' ^ ® es ^ °f the Best Series 

1 ^l( Baltimore Tops NL Champs in 12th 



PAGE 21 

UP LilGk 

The Associated Press^ ieCMd in the majors at 44-19 Mariners 9. Dodoma Russ 

Davis hit a^bh^er with 
f0 f CT Bade y 5 eight-hitter and one out in the ninth and Ken 
*® s ?P®™?" ty / ri ?L^ ner " ^ on ?® ^ by Ellis Burks, Griffey Jr, Edgar Martinez 
jean League and of them- Andres Galarraga and Lany and Paul Sorrento all 

se 5 **- . . . WaQter powered Colorado to homered to lift the Mariners 

• The Orioles won their its fust interleague victory in past Los Angeles in Seattle, 
second consecutive game a Oakland, California. Seattle, leading the AL 

the histone interleague senes Bailey struck out five and with 98 homers, had 1 1 hits — 
■ __ walked four en rente to a six doubles and four homers. 

past Los Angeles in Seattle. 
Seattle, leading die AL 

Basiba&l Bound up 

Seattle, leading die AL 
wto98bomers I hadllhits — 
six doubles and four homers. 

— - game this season. 

between baseball’s best Walker went 2-for-3 and 
teams, beating the Braves, the raised his major-league-lead- 

team-record fifth complete Griffey’s homer was his ma- 
ganM: this season. ’ jor-leagne-leading 27th. 

Walker went 2-for-3 and The Mariners have won 

Jr-iiifitilSisaTV v - - — 

National League champions, ing batting average to .412. 
8-3 in Atlanta on Saturday op Cubs g t p, UMU u 5 The 

Chrn Hoiles’s two-ran rookie Kevin One went 3-for- 
douWe in die 12th inning. 3 with a homer and Chicaj 
Hoiles slammed an 0-2 won its first interieagi 
pitch from Joe Borowski off game, stopping visiting Mi 
the right-field wall after strik- wankee before the large 
ing out in his first five at-bats. crowd of the season 
The Baltimore catcher fell Wrigley Field. 

(me short of the major-league The annnmwH attendant 

four straight and 10 of 12. 

Royals 8, Pirates 3 Kansas 
City’s Jeff King hit two more 
homers agamst his old team. 

3 with a homer and Chicago giving hhn three in two 
won its first interleague games, and Tim Belcher, one 
game, stopping visiting Mil- erf die Pirates’ chief antas- 

game, stopping visiting Mil- 
waukee before the largest 
crowd of the season at 
Wrigley Field. 

The announced attendance 

of the Pirates’ 
onists while 

chief antag- 
in the NL, 

Mjii lL<nL V-.-ii* r I wi>n- 

Carl Everett of the Mets colliding with the Boston catcher BUI Haselman at the plate. Everett was out, but New York went on to win, 5-2. 

Deion Sanders overshad- 

. -:;i •1 

rv-- . v. j: . 

rK.'TV. >' -V eufTr :*■_= 

...lil .'.iT.Kf'rr.i.' 

a* SI ■ K- • • 

•T.a wi . . i; ■ _» . 

.*• ; r- 7 r: 

r ^rVr.: '..u?: SuiL cj: 

iifc-.i.- •. K-V-:“ 

‘ i~ ‘-••V : 

■yy ^ m r. L*vr’ - h- -< 
s.-le-.-V ... 

irr* \i\ 

41-. si.^V f 

■ -rr-y *. ■ 

. -t* •' ;*■’• j,- r ". _ ’7\ j *“ m 


■U-fc .j; *.’?<• .-*.7 Vi‘4i" 
s. . 

." ? t ’L. * \kS i ~i 


l i-.sKt i. ~.z 

>.iii :» . • 

record for strikeouts in an ex- was 38^93 — many of 

tra-uming game. 

. Arthur Rhodes picked up 
the victory with three hitless 

Brewers* followers from 
across the state line. 

The winner for the Cubs, 

pitched seven effective in- owed Belle — once again the 
rungs in Pittsburgh fans’ favorite target — by 

King, who hit die first pitch singling .home one run with 
he saw in his return trip to his 500th career hit and sew- 
ing another. Belle was hitless 

from Pittsburgh for a homer on Fri- 

day, added two solo shots — in four at-bats. 

^ , — , his 10th and 11th — in his 

innings in relief and Randy Steve Trachsel, showing why final two at-bats. 

Myers earned his major a National League starter im> 5, white Sox 1 Kent 
league-leading 22d save. Five must do more than pitch, had Mercker kept Albert Belle in 
Orioles relievers limited the two hits and a sacrifice bunt, check and held slumping 
Braves to one hit over six in- despite entering the game just Chicago to four hits over 
nings. Baltimore has the best l-for-25 this season. eight innings in Cincinnati. 

Chicago has managed only 
10 hits while splitting its two 

by pulled abdominal muscles. 

Cardinals 5, Indians 2; In- 
dians 8, CaiBnili 3 The Sl 
L ouis rookie Matt Morris 
pitched a five-hitter over 81A 
innings of the second game 
against visiting Cleveland as 
the Cardinals earned a split in 
the first interleague double- 

interleague games with die header. 

Reds. The White Sox have lost The Indians emulated the 

five of six overall and gone 2- 
5 with Frank Thomas, the 

NL’s move-the-ru nner-over 

the left-field wall after Darren 
Daulton had tied it in the bot- 
tom of the sixth with a solo 

Twins 6. Astros i Matt Law- 
ton hit a two- run homer in the 
first inning and Minnesota 
snapped Darryl Kile’s per- 
sonal six-game winning 
streak in Houston. 

Kile (7-3) walked Chuck 
Knoblauch to start the game 


AL’s leading hitter, sidelined runs in the seventh and eighth 
‘ innings of the opener. 

style and scored all of their and Lawton followed with his 
runs in the seventh and eighth fourth homer of the season. 

Gritty Bulls Are NBA Champs Again 

tings of the opener. Kile settled down and kept the 

Jim Thome drove in four Twins in check but still got 

CCPA Ah*: 

worn t 

By Mike Wise 

Atrw York Tmes Service 

• CHICAGO — Michael Jordan, Scot- 
tie Pippen and the world’s best bas- 
ketball team traded in style for sub- 
stance to topple the Utah Jazz. 90-86, 
and win Chicago’s second straight Na- 
tional Basketball Association champi- 
onship, and its fifth in seven seasons. 

Riding the grit of their two superstars, 
the Bulls won the series Friday, four 
games to two, despite shooting a paltry 
34 percent in the first half and trailing by 
7 points at halftime. 

Jordan rebounded from a slow start to 
put on a show in the second half. Pippen 
was equally impressive, blocking shots, 
scoring and rebounding. The Bulls got 
little help from their supporting cast. - 
-Utah’s Karl Malone was abominable 
from the field when, it mattered most 
But Malone and John Stockton received 
help from their teammates while die 
Balls- were again reduced to die two- 
sided triangle offense. 

Jordan and Pippen combined for 21 of 
Chicago’s 27 third-quarter points. Save 
a JudBeochler 3-pointer at the end of die 
period that helped die Bulls dose to 
widmr70-64, the Jazz were getting more 
production from their cast of extras. 

Howard Eisiey was efficient and ex- 

citing as Stockton’s replacement, Bryon 
Russell hit some huge jump shots and 
Greg Ostertag was heeding Luc 
Longley’s progress in the middle. 

Utah seemed to have die game in 
hand early, but, iust as in Game 5, the 
Bulls fought back 

Utah led after one quarter, 23-17, and 
consistently took Chicago out of its of- 
fense by swatting away passes in the 
lane and not giving up position under 
the basket 

Malone was woeful from the field 
and free-throw tine. He missed 7 of 1 1 
free throws and was only three of eight 
from, the field in die fust half for 10 
points. But somehow the Jazz com- 
pensated. Russell marie three 3-pointers 
In the first half, including back-to-back 
shots in the second quarter, when the 
Bulls had closed to within 28-24. 

It wasn't as though Jordan and his 
teammates were not interested. They 
pursued loose balls with zeal and con- 
tested most of the Jazz’s shots. But the 
Bulls could not synchronize their efforts 
and their talents far a sustained ran. 

They were at a further disadvantage 
whenPippen was called for his third foul 
with 1 minute 46 seconds left in the first 
half. Utah led by 10 at one point and had 
the Bulls down 44-37 at intermission. 

It was not much of a lead, given 

Chicago 90 , Utah 86 





A PF Ms 







4 17 







3 21 







3 1 







3 13 







5 18 







1 £ 







1 0 







1 2 







1 8 







3 0 








14 25 86 





A PF Pt* 






2 i 







3 1 







0 - 


* Harper 





2 : 







4 : 







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0 1 







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15 28 90 






runs for Cleveland in the day- 
night doubleheader, forced by 
a rainout Friday night. 

Expos 1, floors o Pedro 
Martinez struck out a career- 
high 14 and pitched a three- 
hitter as Montreal shut out 
visiting Detroit and extended 
its winning streak to a season- 
high eight games. 

Martinez (9-2) aided a per- 

the loss, his first since April 
30 against Montreal. 

Rangon 8, Padros 6 Dean 
Palmer had four RBIs as Texas 
stopped visiting San Diego. 

interleague play made the 
game the fust regular-season 
meeting of reigning MVPs 
(Juan Gonzalez of the 
Rangers and Ken Caminiti of 
the Padres) and managers of 

sonai three-game string of the year (Johnny Oates of 
losses and lowered his major- Texas and Brace Bochy of 

league-leading ERA to 1.60 
with his sixth career shutout 
and second this season. 

Bhao Jays 3, Phlfot 2 

Toronto’s Joe Carter, whose 
ninth- innin g homer off Mitch 
Williams in Game- 6 of the 
1993 World Series beat the 
P hilli es, hit a two-run homer 
in the seventh to top diem 
again in Philadelphia. 

With Orlando Merced on 
first. Carter hit an 0-2 fastball 

San Diego). 

Fear of (More) ‘ Fraternizing ’ 

Los Angeles Times Sen u e 

Tony Phillips of the Anaheim Angels and Rickey 
Henderson of the San Diego Padres were running sprints 
on the outfield grass, loosening up before the interleague 
opener at Anaheim Stadium. 

The former Oakland Athletic teammates embraced 
warmly as their paths crossed behind second base, where 
they chatted briefly. 

A touching reunion benefit of the innovative June 

The Chicago Cubs’ manager. Jim Riggleman. would 
describe it another way. 

“There already is too much fraternizing going on as it 
is in baseball.’ ’ Riggleman was saying before the Cubs 
opened a weekend series with the Milwaukee Brewers at 
sold-out Wrigley Field in Chicago. 

“Now that players see guys from the oiher league, 
there may be a temptation to say, ’We see them less, so 
we’ll talk to them more,’ ’’ Riggleman said. 

“Thai’s a pet peeve of mine." he added. “You’re 
trying to beat the other club. I don’t like all the glad- 
handing before games. You don't see football players 
doing that 15 minutes before their games.” 

slam and Jeff Kent added two their second interleague vic- 

Texas went up 5-0 in the home runs as San Francisco tory in three games. 

• Gary Sheffield’s grand 
slam and five other first-in- 
ning runs were wiped out 

first on a bases -loaded, pounded the Angels in Ana- «Gary Sheffield’s grand 
double-play grounder by heim, California. slam and five other first-in- 

Gonzalez, a three-run homer Aurilia hit a 2-2 pitch from ning runs were wiped out 
by Palmer and a solo shot by his forma teammate Allen when rain forced the cancel- 
Mike Simms three pitches Watson into the left-field seals lationofiheYankees-Marlins 
lata. It was Palma’s sixth with two outs in the second game in Miami. The game 
homer, his first since May 11. inning afta Watson walked will be made up as part of a 
and Simms’s fourth. Damon Beiryhill and Darryl doubleheader on Sunday. 

Giants io, Angels 3 Light- Hamilton to load the bases. Florida led, 5-4, when play 
hitting Rich Aurilia. starting The NL West-leading Gi- was suspended with nobody 
for iust the eighth time this ants finished with a season- on or out in the bottom of the 

lata. It was Palma’s sixth 
homer, his first since May 1 1 . 
and Simms’s fourth. 

Giants 10, Angels 3 Light- 
hitting Rich Aurilia. starting 
for just the eighth time this 

by the rookie Ryan Nye ova year, hit his first career grand high four homers in recording 

will be made up as part of a 
doubleheader on Sunday. 

Florida led, 5-4, when play 
was suspended with nobody 
on or out in the bottom of the 

3-Patt 9Mte Lrtoh M5 (Russet 5* Honnok 2-C 
StocWon <H, Andmcn 0-t, Morris M), Chicago 5-14 
(Kofcoc 1-1, Buediler 1-1* Kerr 1-2, Pip pen 1-4, Jordon 
1-4, Rodman 0-1, Harper 0-1). IMrricOs; Mo tone. 
WIKoms Rodman Chicago llegal defense. 

(Chicago no series' 4-0 

Chicago’s histoiy at home and Jordan’s 
history of refusing to let someone get 
too close to breaking up his dynasty. 

< *f c * f T 

■**«■ .•■***— v-*- 

M.-jans- -i i •<!* 

■ • -iz- .., .-^ --^7? -- •■'r 

I. . l'l»- 1 >- 1 

Jordan’s Plea: Stick With the Winners 


•" . ♦■-"iSt.-*-- Js-f c. •• 

... ' r. 

. . .. h 4 > a r ---• 

-i- — -=*=.-■ Li"- 


m, *T w i" r wr 

Washmgion Post Service 
CHICAGO — An hour 
after ■finishing one mission — 
winning a fifth National Bas- 
ketball Association champi- 
onship — Michael Jordan em- 
barked upon another: keeping 
I his Chicago Bulls together de- 
I $jfte bints from top manage- 
ment drat it might be time to 
trade some of Hie assets and 
start the rebuilding process. 

' Jordan usually saves his 
best politicking for private 
conversations, but in the wee 
boors of Saturday morning — 
after the Bulls had de f eate d 
tbetHah Jazz, 90-86, in Game^ ' 
6 — he let fly easily the most 
forceful soliloquy of his 13- 
year career. 

■ Jordan challen ged the team 
chairman, Jerry Remsdorf, 

Vantage Point / Michaki.Wii.bow 

and vice president, Jerry 
Krause, to make whatever fi- 
nancial sacrifices necessary 
to retain the coach, Phil Jack- 
son; the Bulls’ other star play- 
er, Scottie Pippen, and die 
core of the team, which 
Jordan said is only payback 
for services rendered drat 
have made the Bulls the most 

popolar sports franchise in the 

world ana one of the richest 
“I think this team is en- 
titled to an opportunity to 
continue to be successful,” 
Jordan said. “I’m ribt saying 
Jerry Reinsdorf is die richest 
guy in the world. Tm not say- 
ing that all his partners can 
financially support what this 

litfT : 

« y a m m ***** 

iwr ■**•*“•** *■ 

jfr /jpoft. --j 

w- * - •* 

0 ^- .M 

StT UryemfAr** Paocc-Picncr 

" ^ -? MBtedFjfcriaa celebrating the BoDs* fifth NBA title 

^ members said Chicago’s previous trophies. 

team needs to maintain or be 
successful. But we’ve done a 
lot for this organization. We 
put it in a situation where it 
can be voy valuable. When I 
first came here I’m petty sure 
everybody can tell you that 
the Bulls team was worth 
probably S13 million, maybe 
$15, $16 or $17 million. Now 
it’s worth $150 million.” 

He added: ' ‘What we want 
now, in hying to keep this 
teg*™ together and successful, 
we paid for ova the last six, 
seven, eight. 10 years. There 
has to be some consideration, 
some sense of loyalty to my- 
self, to Scottie, to Phil, even to 
the guys who have given of 
themselves ova the last two 

“We’re entitled to defend 
‘ what we have until we lose it 
If we lose it, then you look at 
it and say, ‘OJK., let’s 
change.’ But rebuilding? 
Nobody is guaranteed re- 
building is going to take only 
two, three, four, five years. 
The Cubs have been rebuild- 
ing for 42 years.” 

Actually, it has been 52 

years since the Chicago Cubs’ 

last championship season. 

Jordan played this season 
with a one-year, $30 million 
contract Before die season, 
the Bulls sig ned Jackson to a 
one-year contract that al- 
lowed him to negotiate with 
. other teams during the play- 

Pippen has been the subject 

of trade rumors. Remsdorf 
and Krause believe that they 
are themselves as responsible 
for die five championships as 
Jordan, Pippen and Jackson, 
the only three members of all 
five title teams. 

They have expressed the 
desire more than' once to 
prove that the franchise can 
win a championship without 
rtmr threesome. But Jordan 
has backed them into a 
coma, saying that he won’t 
return if it means playing for a 
coach other than Jackson. 

“Sad as it may be, 1 have 
choices and I 'choose not to 
play for another coa ch .” 

Jordan said when he returned 
from his 18-months of base- 
ball “retirement” in March 
1995. “I chose to play for Phil 
Jackson and to finish Scottie 
Pippen ’s contract,’ ’ which ex- 
pires afta the 1998 season. 

Jordan said Pippen has 
“earned it. I've earned it, Phil 
has earned it and the city of 
Chicago has earned it” 

Just 48 boors earlier, in 
Wednesday night's Game 5, 
Jordan, 34, was dehydrated, 
feverish and vomiting due to a 
stomach virus. But he scored 
38 points, including the three- 
pointer ' that put the Bulls 
ahead. He struggled to get 
back to his feet twice in Game 
6, prompting speculation 
about his health and stamina. 

“Pm tired. I’m weak, but 
I've got the whole summer to 
recuperate, ’ ’ Jordan said. “It’s 
been a figh t. It’s rdl guts, deep 
down, determination. There’s 
been a lot of soul-searching. 
It's easy to sit back and say, 
Tve given my best. I’m tired, 
somebody else has got to do 
iL’ But I didn't take that ap- 
proach. I did whatever I could 
do. Every little inch of energy I 
have. I'm going to provide fa 
this team.’’ 

Jordan, more than he ever 
has in the 10 years the two 
have been together, thanked 
Pippen, expressed his admir- 
ation for him, told Pippen be* 
fore toe championship trophy 
presentation, “You’re- my 
MVP.” Jordan said he would 
keep the NBA Fin a ls MVP 
trophy, his fifth in as many 
champ ionships, but give Pip- 
pen the automobile that is 
awarded to the winna. 

He even extended that sup- 
port to Dennis Rodman, whose 
contract also has expired and 
whose shenanigans andsus- 
pensions have at times irritated 
his coach and teammates. - 

“His dressing doesn’t 
botha me,” Jordan said. 
“His hair doesn't botha me. 
Sure, he’s going to go wacko 
every now and then. We’ve 
come to live with that, accept 
iL But you can’t find another 
player on the basketball court 
that works as hard as Dennis 
Rodman. I don’t have a prob- 
lem with Dennis.” 

The best young foe 
Cup to become the 

16 - 22 Juno, LIVE, 

The FIFA Under 20 
World Championship 

Braza, England, Spain, France 
are among the 24 nations who 
qualfied for toe competition 

21 - 22 done, LIVE, 

The PPG CART World 
Series, Portland 

Mark Blundell will want to 
banish the memory of tunning 

out of fuel on the last comer of 
the last lap in the previous 
round of the Championship 

TRIATHLON What’s the hurry? At 82, athlete just wants to finish p.20 NBA Bulls capture their 5th championship p.2 1 

PAGE 22 

<7* l\TMV mill II. M « 4 




MONDAY, JINE 16 . 1997 

World Roundup 

Red Wing Critical 

ice hockey Vladimir Kon- 
stantinov. the Detroit Red Wings 
defenseman, remained in a coma 
Sunday after a car crash in which 
several members of the Stanley 
Cup-winning team were injured, 
bur he appeared to be responding to 
voices of teammates and family. 

“There is movement, there 
have been subtle signs of facial 
expression.” said Dr. James Rob- 
bins. a trauma surgeon at William 
Beaumont Hospital. 

“There's still reason fora lot of 
concern. But it's an optimistic sign, 
and it gives good reason to remain 
hopeful and optimistic that ulti- 
mately he is going to do well." 

Sergei Mnaisakanov, the team 
masseur, also remained in a coma. 
Both men were in critical con- 
dition. Viacheslav Fetisov, a de- 
fenseman, and Richard Gnida. the 
limousine driver, remained in 
good condition and should be re- 
leased soon. Robbins said. 

They were injured when the lim- 
ousine returning from a golf outing 
hit a tree Friday in Birmingham. 
Michigan, six days after the Red 
Wings won the Stanley Cup. 

Gnida \s driving license had been 
revoked until at least next year 
because of his bad driving history. 

Robbins said doctors did not yet 
have any indication what kind of 
recovery Konstantinov and Mnat- 
sakanov could make. (At' l 

De La Hoya Wins Fast 

boxing Oscar De La Hoya put 
on a brief and spectacular show 
before dispatching David Kamau 
in the second round in San Ant- 
onio. Texas, to retain his WBC 
welterweight title. 

De La Hoya was making the 
first defense of the title he won 
two months ago from Pemell 
Whitaker. He dropped Kamau. a 
Kenyan, with a left hook with 17 
seconds left in the second round. 

O Fighting in sweltering heat on 
the eve oF his 46th birthday, 
Roberto Duran won for the 100th 
time in his career with a close 
decision over the Argentine mid- 
dleweight. Jorge Castro. 

The four-time world champion 
was appearing before a hometown 
crowd of 10.000 in Panama City 
on Saturday. He earned unani- 
mous. decisions from the three 
judges, all Panamanian. (API 

Graf Says She May Quit 

tennis Steffi Graf, worried that 
chronic injuries could damage her 
long-term health, said she is con- 
sidering retiring and would have 
no problem ending her career. 

Graf also told Welt am Sonntag 
newspaper that she was unhappy 
over the treatment she had received 
from one of her doctors. (Reuters) 

Russian Official Killed 

SOCCER Larisa Nechayeva, the 
director-general of the top Russian 
club Spartak, was shot dead Sun- 
day. the police said. 

A police officer, speaking by 
telephone from Taratovo. about 
12U kilometers (75 miles) east of 
Moscow, said Nechayeva was 
killed, along with another woman, 
when their car was fired upon. 

f Reuters) 

West Indies Wins Test 

caicket Both opening bats- 
men made rapid half-centuries 
Sunday as the West Indies won a 
low-scoring first test against Sri 
Lanka in three days. 

Sn Lanka added just one run to 
its overnight total and was all out in 
its second innings for 152, setting 
the West Indies IS7 to win. Sher- 
w in Campbell made 79 and Stuart 
Williams 83 and. in spite of a small 
collapse, the West Indies won by 
six w icheis. < Rc liters .AFP 1 

'!.!>• lllaL / H.-uii r- 

Nick Faldo lining up a putt Sunday at the U.S. Open, while his partner, Tiger Woods, looked over his shoulder. 

Lehman Leads a Soggy U.S. Open 

2 Others Are 2 Shots Back After the Rain-Delayed 3d Round 


BETHESDA. Maryland — Tom 
Lehman birdied the final hole of the 
rain-delayed third round of the ll.S. 
Open on Sunday to take a two-stroke 
lead into the final round. 

Lehman, the second-round leader, 
carded a two-under-par 68 for a five- 
under total of 205. He was two strokes 
ahead of Jeff Maggerr, who had led the 
rain-interrupted round overnight, and 
Ernie Els. who jumped into contention 
with three birdies in the five holes that 
he played Sunday morning. 

Colin Montgomerie, who had led the 
first round, was the only other player 
under par entering the last round after 
posting a 67. the lowest score of the 
third round. 

Tiger Woods, the U.S. Masters cham- 
pion, appeared to have dashed any hope 
of continuing a Grand Slam run as be 
finished the round at four over par, nine 
shots off the pace. 

They were among 2 1 players who had 
to complete the third round early Sun- 
day after a thunderstorm struck Con- 
gressional Country Club on Saturday, 
forcing a two-hour delay of play for the 
second consecutive day. On Friday, the 
second round was also interrupted by 
bad weather and had to be concluded 
Saturday morning. 

Maggert. who had wrested the third- 
round lead from Lehman before the 
storm struck, fell back with a bogey on 
the course's scenic signature hole — the 
480-yard, par-4 1 7th, which finishes on 
the shore of a lake that is shared by the 
18th hole. He matched Lehman's 68. 

Els. a South African who won the 
1994 Open in a three-man playoff, 
caught Maggert with three consecutive 
birdies from the 15 th to shoot 69 and 
stand two shots from the lead. 

The final round began immediately 
after the third ended on a pleasant, 
sunny morning, a welcome change from 
the previous two rainy days. There were 

84 players still in the field with the final 
pairing of the day — Lehman and Mag- 
gert — due to tee off at 2:54 P.M. (1854 

Jay Haas (68), Tommy Tolies (69) 
and David Ogrin (71) were all at level- 
par 210. 

Montgomerie, who lost to Els in the 
’94 playoff, had to play only two holes 
in the early morning light, but the Scots- 
man could not gain on the leaders, mak- 
ing a bogey on the 1 7th and then a birdie 
cm the 190-yard 1 8th — the first par- 
three to conclude an Open since 1909. 

Woodsalso played two holes in the 
morning, pairing both for a 73 that left 
him nine strokes back in his quest for a 
seventh consecutive U.S. national 

Woods. 21. who won the Masters 
with a record total score in April, had 
won three consecutive U.S. Junior and 
three successive U.S. Amateur cham- 

Bui he had his work cut out for him in 
the Final round, with 20 players standing 
between him and his second straight 
major championship. 

■ Milestone for Nicklaus 

Jack Nicklaus played his 10.000th 
hole in a major golf championship on 
Sunday at Congressional Country Club, 
reaching the milestone on the 10th hole 
of the fourth round. Agence France- 
Presse reported. 

Nicklaus began the streak with a bird- 
ie on his first hole in 1957 at Inverness 
and made a par four on the 10,000th on 

■ Early Final-Round Scores 

Among the early starters in the fourth 
round Sunday. Lee Janzen, Hale Irwin 
and Nicklaus came in with totals of 293, 
Reuters reported from Bethesda. Mary- 
land. Larry Mize shot a final-round 74 to 
finish at 294. 

None of the early finishers were in 

Pros and Cons Of 

Playing With Tiger 

New Yort Times Service 

When it comes to playing with 
Tiger Woods, Steve Jones received 
a major dose over the first two days 
of the Open, and he found it can be 
good ana it can be bad. 

The positives? It can be ener- 
gizing to play before such a large 
and enthusiastic gallery, and a for- 
giveness factor is involved as 

Even though Jones, Woods and 
Tom Lehman fell two groups be- 
hind at rimes, they were never 
warned for slow play; allowances 
are made because of the crowds and 
the news media that accompany 

The negatives? Those same 
crowds can cause lengthy waits for 
the players, throwing off their golf- 
ing rhythm. "We were always 
waiting for the photographers to get 
on the tee and the crowd to move," 
Jones said. "The fact that the round 
took so long. I don't know if it 
affected us. but even Tiger seemed 
to wear down a bit at the end.” 

And yes. the allowances disappear. 
Saturday, Jones and his playing partners. 
Jesper Pamevik and Thomas Bjorn, were 
told to play faster. 

contention, with the best scores far over 
the 280 par. Bradley Hughes shot a one- 
under 69 in the final round for a five- 
over total of 285. Nick Price of Zi- 
mbabwe shot a 70 to finish on 286. 

Ben Crenshaw shot a fourth-round 74 
to finish at 297. Tom Kite had a 72 for a 
total of 298. Paul Azinger had a 70 to 
finish on 2S8. 

Early Finish Gives | 
Schumacher Victory 

Crash Ends Canadian Grand Prix 


C,9rtf LKu SluiF #!%■ Dbfklk Ik H 

MONTREAL — A crash in which 
Olivier Panis was injured cut short the 
Canadian Grand Prix on Sunday, hand- 
ing a victory to rhe two-time Formula 
One champion. Michael Schumacher. 

Schumacher took the lead moments 
before Panis crashed when David 
Coulthard — who had appeared to be 
assured of victory — stalled while mak- 
ing a pit stop to change his tires. 

As a crew tried desperately to restart 
Coulihard’s Mercedes-McLaren, Panis 
slid through a turn, tagged a concrete 
barrier with the nose of his Prost-Mugen 
Honda and slammed into a tire wall. 

The Frenchman was carried to the side 
of the track, while a safety car led the rest 
of the field slowly around the 2.747- 
mile, 15-tum Circuit Gilles Villeneuve 
on Montreal's Notre Dame Island. Panis 
was taken off in an ambulance. Initial 
reports were that he had a broken leg. 

A red flag ended the event after the 
completion of 54 of a scheduled 69 laps. 
The last time a Formula One event was 
cut short by accident was at Estoril, 
PortugaL on SepL 23. 1990. when Alex 
Caffi crashed. 

The victory was Schumacher's 
second of the year and the 24th of his 

"1 bate to win a race like that, and 1 
feel badly for Olivier.” 

Schumacher said. 

A record crowd watched the race, in 
hopes of seeing a victory by a home- 
town hero. Jacques Villeneuve. 

But the 26-year-old racer crashed 
near the end of the second lap. locking 
his brakes and sliding into a concrete 

"It can happen.” Schumacher said of 
Vilieneuve’s mistake. "We push hard. 
Sometimes you do a bit too much. But I 
was a little surprised. Top drivers don't 
spin off too often." 

The race turned into a strategic battle 
between the Ferrari of pole winner 
Schumacher and Coulthard, who started 
fifth. Both wound up having problems 
with blisters and wear on their Good- 
year tires. 

"We did everything to keep the tires 
alive for the distance, but obviously it 
wasn’t enough," Schumacher said. 

Schumacher led until he made his 
first pit stop on Lap 28, giving up the top 
spot to Coulthard. Coulthard stopped on 
the 40th lap. Schumacher started losing 
ground because his tires blistered again 
and he made unscheduled third pit stop 
on lap 51, falling nearly 32 seconds 
behind Coulthard, who decided he had a 
big enough margin to stop for fresh tires 
and retain the lead. 

Bur problems with his clutch led to 
the stalled engine, and Schumacher 
drove by to take the lead. Coulthard 
wound up just outside the points in 
seventh, the last car on the lead lap. 

Jean Alesi finished second in a Be- 
netton-Renault, followed by ViJJen- 
euve's Wiliiams-Renault teammate 
Heinz-Harald Frentzen, Johnny Herbert 
in a Sauber Petronas and Shinji Nakano, 
in the other Prost-Mugen Honda. 

Canadian Grand Prix 

RmuRb of Sunday * C anadian Grand Piix. hated 
after 56 of scheduled G9 lam and resdis at wrnen 
were calculated an basis of 54 laps ccmpletod : 

i. Mkhcef Schumacher. Ger. Ferrari SJ topi 
23IL734Mrvin I h. 17m. s. o» jw kcr. j. 
Jecn Alesi. France. Benrtton- Permit?. id JL56J v 3 
Gtancario FiMCMUa. '*bh. JonJon-Pecxjeo* j.31? j 
Heuv-HarakJ Frenhea Otrrss r.y. V.'a&cms-fceroOT 
3.76ft S. Johnny Heroert. Britain. Sauber i 716. 6. 
Shini Nakano. Japan. Pros: Muocn Honda 36 701. 

points.- ?. Jacques Vritenewe Canada 7Cs 1 Dinner 
Pants, Franca IS 4. Eddie Irvine. Bril sin, t * 5 . 
Frentzen J1 he Alesi 73 

51 poin& 7. WIIImips 41 3. Benetton 23. 3. McLaren 
21. 5-Prast laa. Jordan 1Z 7 Senior 9. 8 , Stefan 4. 5. 
Tynefl 2 . 

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iu ier 

AJborelo Wins 
Le Mans in 
Joest Porsche 



i ■ a 

; KrffT* 


CiMCifnl In lhi» Surf t'nw bi- 

LE MANS. France — Michele Al- 
boreto drove the Joest Porsche proto- 
type to victory Sunday in rhe Le Mans 
24 Hours race. 

*Tve had thisdreamfora long time of 
winning this race, and now it has come 
true," Alboreto, a 40-year-old Italian, 
said after the victory . 'shared with his 
partners. Stefan Johansson of Sweden 
and Tom Kristensen of Denmark. 

It was the second consecutive win- 
ning effort for the Joest Porsche team, a 
private team that uses a Porsche engine 
in its cars. The factory-backed Porsche* 
dropped our while comfortably in front. 

Alboreto. Johansson and Kristensen 
combined for the victory with more than 
360 laps completed. The car had led the 
qualifying run on the 13. 605- kilometer 
(8.456-mile) circuit. 

The factory Porsches were first and 
second for nearly 20 hours. The Joesi 
Porsche gained the lead when the 
second factory Porsche caught fire with 
two hours and 15 minutes to go. 

The Porsche of Thierry Boutsen. Bob 
Wollek and Hans Stuck took rhe lead in 
the second hour of the race and held firsr 
for nearly 14 hours before Wollek went 
off the road and stopped 

The second factory Porsche was 
holding a one-lap lead when it burst into 
flames on the track. Ralf Kelleners goi 
out unhurt, but the car was out of the 
race after 327 laps. 

McLaren FI GTRs finished second 
and third. The team of Jean Marc Gouno 
and Pierre Henri Raphanel of France 
and Anders Olofsson of Sweden was 
runner-up, about two laps back. 

Only 1 7 of the 48 starters finished the 

Mario Andretti, seeking the only ma- 
jor title he has yet to win. faltered again 
as the Courage Porsche he drove with 
his son, Michael, and Olivier Grouillard 
of France crashed on Sunday morning. 

(Reuters. AP ) 

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A McLaren BMW driven by the team of Stever Soper, J. J. Lehto and 
Nelson Piquet leaving the pits during the 24-hour race in Le Mans. 

‘ - • :r.~ hi*, rirfdfte 

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