Parliament OKs Primakov for Post of Russia Premier

By RICHARD C. PADDOCK

Sept. 12, 1998 12 AM PT

TIMES STAFF WRITER

MOSCOW — Swiftly winning confirmation Friday as prime minister, Yevgeny M. Primakov moved to initiate a new era of government in Russia, naming two Communists to key economic posts but promising a Cabinet of professionalism and unity.

Faced with the enormous task of jump-starting Russia’s stalled economy, the man who served as foreign minister until Friday said that greater state regulation will be necessary but insisted that there will be no return to the failed Soviet strategy of a command economy.

Nominated as prime minister Thursday by President Boris N. Yeltsin and confirmed by a 315-63 vote in the Duma, parliament’s lower house, Primakov asked legislators and the public to give him time to develop and implement an economic recovery program.

“I want to tell you all in advance: I am not a magician,” he told the Duma moments before the confirmation vote. “The country is in such terrible condition. We will do everything we can, but don’t expect quick results.”

Primakov also said he will push for ratification of the long-stalled START II nuclear disarmament treaty, a top priority of the Clinton administration.

“There will be no return to the Cold War,” the new premier said.

One of the greatest threats confronting Russia is the potential disintegration of the country as regions far from Moscow attempt to assert their independence while the central government is weak, he said.

“We are facing a serious danger of seeing Russia divided,” Primakov told the Duma. “Our society needs unity in order to get out of this very deep crisis.”

Primakov is taking over at a time when the government is virtually bankrupt, industry and commerce have nearly creaked to a halt, the value of the ruble has plummeted, inflation is soaring, and stores are running out of goods to sell. The economic crisis brought on a power struggle that paralyzed the government for nearly three weeks, as Yeltsin twice nominated former Prime Minister Viktor S. Chernomyrdin to return to the post and the Duma twice rejected him.

“Russia was standing on the brink of a serious political crisis,” Yeltsin said in a televised speech before Friday’s confirmation vote. “But we have succeeded in avoiding it. The political leaders of the country have proved that, at the decisive moment, they are capable of making compromises.”

Primakov, onetime head of Russia’s foreign intelligence agency, won support in the Duma from a broad spectrum that included Communists and pro-market liberals. But his initial moves prompted some deputies and analysts to conclude that his ascendance was a major victory for the Communists.

“We are entering a phase of very grave transformations that could be called a rollback to a regulated economy,” said Konstantin N. Borovoi, a liberal Duma deputy and entrepreneur. “It is a catastrophe. We consider the recent developments and actions a Communist coup that will bring incredible pain to the people.”

Before the vote, Primakov named Communist Yuri D. Maslyukov, 60, as first deputy prime minister in charge of economic policy. A onetime member of the Communist Party’s ruling Politburo, Maslyukov headed Gosplan, the Soviet economic planning agency, during the final years of the Soviet Union. More recently, he served as minister of trade and industry in the Cabinet of Prime Minister Sergei V. Kiriyenko, whom Yeltsin fired last month after a mere five-month term.

The prime minister also chose Viktor V. Gerashchenko, 60, a former Communist Party Central Committee member, to head Russia’s Central Bank, whose controversial monetary policies have been at the center of the fiscal crisis. Under Yeltsin, Gerashchenko headed the Central Bank until a sudden fall in the value of the ruble cost him his job in 1994. Critics say Gerashchenko brought on hyper-inflation in the early 1990s by printing rubles to pay government debts. The Duma voted to confirm him in his new post by a vote of 273 to 65.

“The faces that we will see in the Russian government soon will be the same as we would have seen under a Communist president,” predicted Andrei A. Piontkovsky, director of the Independent Institute for Strategic Studies, a Moscow think tank. “And the government will do the same thing as the Communists were doing in the past.”

Others, however, were less alarmist and said Primakov’s true intentions will not be clear until he names the rest of his 30-member Cabinet in the coming days.

“It is high time we stopped dividing people into democrats and Communists,” said Mikhail G. Delyagin, a former economic advisor in the Kiriyenko government. “It is time to start dividing them into fools and smart guys. As we all know, the worst mistakes of the last several years were committed by none other than the staunchest democrats.”

After Primakov was confirmed, Yeltsin signed a decree naming Igor Ivanov, who was first deputy foreign minister, to replace Primakov as foreign minister. Yeltsin also reappointed three ministers from the previous Cabinet: Igor D. Sergeyev as defense minister, Sergei V. Stepashin as interior minister and Sergei K. Shoigu as civil defense minister.

Despite his promotion, the Foreign Ministry said that Primakov will go on a planned trip to New York as early as next Saturday to attend a session of the U.N. General Assembly, the Interfax wire service reported. He may also arrange to see President Clinton, the report said.

Addressing Russia’s economic crisis, Primakov said the country must continue the privatization of state enterprises, improve tax collection and use the banking system to rebuild industry. At the same time, he said, the government should play a greater role in some economic activities.

“The state must interfere in and regulate many processes in the economy,” he said. “This is not a return to the command and administrative system. Nobody criticized [U.S. President Franklin D.] Roosevelt when he introduced state controls over the economy after the Great Depression. So what must we do? Repeat the wild capitalism that we have had up until now? Or use the experience of other countries?”

Sergei L. Loiko and Alexei Kuznetsov of The Times’ Moscow Bureau contributed to this report.