OMRI DAILY DIGEST
No. 214, Part II, 2 November 1995

**********************************************************************
The new weekly OMRI Economic Digest will be delivered free of charge to
Daily Digest subscribers on four successive weeks beginning on 2
November and ending on 23 November  For more information about the
Economic Digest, including subscription rates, please contact OMRI in
one of the following ways:
--send an e-mail message to 
--call OMRI in Prague, Czech Republic, at (422) 6114-2114
--fax: (422) 6114-3184
--through our World Wide Web page: http://www.omri.cz/Econ/Info.html
**********************************************************************

CONTROVERSY OVER SLOVAK LANGUAGE LAW. Miklos Duray, chairman of the
ethnic Hungarian Coexistence party, told Praca on 2 November that the
Slovak language law violates the country's constitution and the Slovak-
Hungarian treaty. The most recent version of the bill was approved by
the cabinet on 24 October and will be discussed later this month by the
parliament. According to Duray, ethnic Hungarian deputies will not
support the treaty if certain controversial legislation is passed first.
Representatives of Slovakia's ethnic Hungarian parties are scheduled to
meet with Council of Europe secretary general Daniel Tarschys on 2
November to discuss the government's draft language law. In other news,
Meciar and his Hungarian counterpart, Gyula Horn, will meet in Berlin on
10 November to discuss the language law. -- Sharon Fisher

HUNGARIAN PREMIER VISITS BRITAIN . . . Gyula Horn, during a 36-hour
visit to Britain aimed at improving economic and political ties, said on
31 October that admission to EU and NATO are of equal importance to
Hungary for economic, political, and security reasons, Hungarian
newspapers reported the next day. Horn met with his British counterpart,
John Major, who pledged that Britain would do its best to promote
Hungary's accession to both institutions; EBRD president Jacques de
Larosiere; and other high-ranking officials. Horn said that Hungarian
foreign policy aims to decrease tension and forge good neighborly
relations in Central and Eastern Europe. He suggested that assurances be
given to Russia and Ukraine that NATO expansion will not represent a
security threat to them. -- Zsofia Szilagyi

. . . AND THREATENS RESIGNATION. On his return to Hungary, Horn, who is
also Socialist Party leader, said that if the prime minister is not
allowed to be also head of a political party, a new person will have to
be found to replace him in both jobs, Hungarian media reported on 2
November. His statement appears to have ended a dispute within the party
about the separation of the two posts. Many socialist deputies,
including those most critical of allowing one person to hold both
positions, seem uneasy about a separation under such conditions. The
issue of separating the two posts came up several months ago when the
socialist caucus became increasingly critical of Horn's moves as
premier. Until now, Horn had seemed willing to accept the idea. --
Zsofia Szilagyi

ROMANIAN REACTIONS TO BISHOP TOKES' "ALTERNATIVE RECONCILIATION"
PROPOSALS. Reacting to Reformed Bishop Lazslo Tokes' "alternative
proposal" for a Romanian-Hungarian reconciliation (see OMRI Daily
Digest, 1 November 1995), presidential spokesman Traian Chebeleu said
that the honorary chairman of the Hungarian Democratic Federation of
Romania "lacks credibility" because of his repeated "anti-Romanian
attitudes" and his spreading "lies" abroad about the situation of the
Hungarian minority. Foreign Ministry spokesman Mircea Geoana told a
press conference in Bucharest that Tokes' proposal shows he was
demanding autonomy based on ethnic criteria, which, he said, is rejected
by all European states and "undermines stability in our region," Radio
Bucharest and Reuters reported. -- Michael Shafir

LEADER OF ROMANIAN EXTREMIST PARTY RESIGNS. Mircea Hamza, a deputy
chairman of the extremist Greater Romania Party (PRM), has resigned his
post. In an open letter to PRM leader Corneliu Vadim Tudor published in
Evenimentul zilei on 2 November, Hamza said the PRM started out as a
patriotic party but has turned into one displaying "grotesque wholesale
attitudes against Hungarians, Jews, and Gypsies." Hamza denounced
Tudor's attacks on Romania's efforts to become integrated into European
structures, saying that "by implication" this amounts to opting for "the
zone represented by Russia." He added that Tudor has "blindly and
grossly" attacked President Ion Iliescu, thereby insulting all Romanians
who voted for him. -- Michael Shafir

[As of 12:00 CET]

Compiled by Jan Cleave


Thursday, 2 November1995
Volume 2, Issue 213


REGIONAL NEWS
-------------

	**LANGUAGE TALKS**
        Hungary and Slovakia are going to hold talks on a new language
        bill in the Slovak parliament.  The Slovak government approved
        the legislation last week.  It stipulates that public
        employees, including teachers, have to read and write Slovak.
        Hungary thinks the measure would violate the rights of
        Slovakia's 600 thousand ethnic Hungarians.  Hungarian Prime
        Minister Gyula Horn and his Slovak counterpart Vladimir Meciar
        will meet next week on the fringes of a conference in Berlin
        to discuss the legislation.  They'll also be discussing a
        bilateral treaty which still has to be ratified by the Slovak
        parliament.  Horn and Meciar signed the treaty last March.
        It's aimed at settling years of tense relations between the
        two countries over the treatment of ethnic Hungarians.

        **POLITICIANS FEUD IN ROMANIA**
        Romanian President Ion Iliescu is accusing Reformed Church
        Bishop Laszlo Tokes of extremism and anti-Romanian atttitudes.
        Tokes is honorary chariman of the Hungarian Democratic Union
        of Romania.which represents Romania's one point six million
        ethnic Hungarians.  Iliescu says Tokes "lacks any credibility
        in advancing Romania-Hungarian reconciliation proposals."
        Iliescu recently launched an initiative for "historical
        reconciliation" between Bucharest and Budapest modelled on the
        post-World War Two relationship between France and Germany.
        But Tokes has rejected Iliescu's proposal.  He says it fails
        to address the problems of Romania's ethnic Hungarians.  Tokes
        has a counter-proposal giving ethnic Hungarians some autonomy.
        It's modelled on policies dealing with the German minority in
        Italy's autonomous South Tyrol region.



BUSINESS NEWS
-------------

        **STAY THE COURSE, SAYS THE BANK**
        A World Bank official warned Hungary yesterday not to falter in
        its resolve to force the economy through a painful economic
        transition.   CET's David Fink has details from Budapest.

        Resident World Bank Representative Millard Long was responding
        to an open letter from a group of Hungarian economists asking
        the World Bank to explain its recommendations by accepting
        that the country's transition can be painful.  In a letter
        published in the daily Magyar Nemzet Long wrote."I think that
        if the measures supported by the International Monetary Fund
        and the World Bank would suffer a delay now, in the coming
        years the pain of the transition could become more serious..
        It's very difficult", Long says, "to know how to ease the
        severity of a "sharp shock" transition from a socialist
        planned economy to a free market system.  Last March, the
        Hungarian government announced a tough austerity package aimed
        at reining in government spending.  The package won praise
        from the IMF and World Bank as a way of creating  sustainable
        economic growth.  In Hungary, however, the austerity measures
        triggered a wave of demonstrations and the resignation of four
        cabinet members.  The left wing of the Socialist Party has
        openly criticized Prime Minister Gyula Horn for abandoning
        leftist values and ignoring the plight of ordinary people.
        Horn is expected to come under pressure to water down the
        austerity package at the Socialist Party's annual congress
        later this month.

ABOUT CET ON-LINE
-----------------

* CET On-Line is Copyright (c) 1995 Word Up! Inc., New Media
  Group, all rights reserved.  Not-for-profit redistribution of
  CET On-Line in electronic format is allowed only if our
  copyright notice, and all other copyright and by-line
  information contained in this publication is included.
  For-profit distribution of this publication or the information
  contained herein is strictly prohibited without the express
  written permission of Word Up! Inc., New Media Group.  These
  conditions are subject to change without notice.  For further
  information, contact Zoltan Nagy at >

  Some portions of the news provided by special agreement with
  Reuters.  For information on Reuters news and information
  products, contact your local Reuters office.


* All "Letters to the Editor" and other comments about
  editorial content should be directed to Duncan Shiels at
  >.  Any comments about distribution or
  production should be directed to Zoltan Nagy at
  >.


**CET On-Line** is a Word Up! Inc., New Media Group
  Publication.  The New Media Group also publishes the Prague
  Financial Monitor on-line.  For more information on the Prague
  FM, send a message with the word INFO in the body of a message
  to >.

  For a copy of the latest issue of the Prague Financial Monitor,
  send a blank e-mail message to >.


**Subscription Information**
  CET On-Line is a free e-publication.  Subscribe by sending a
  message with the word SUBSCRIBE in the body of a message to
  >.  For an automated information
  response, send a blank message to >.

  To unsubscribe at any time, send the word UNSUBSCRIBE in the body,
  not the subject line, of a message to >.

  For a copy of the latest issue of CET On-Line, simply send a blank
  e-mail message to >.


OMRI DAILY DIGEST
No. 215, 3 November 1995

HUNGARIAN NEO-NAZI TRIAL OPENS. Two neo-Nazi leaders have appealed to
the right to free speech at their trial in Budapest, which began on 1
November. The two men, along with several others, are charged with
inciting racial hatred at numerous meetings where they denied that the
Holocaust took place. They have also been accused of using prohibited
symbols and circulating neo-Nazi propaganda material. Both denied the
charges, saying that Hungarian neo-Nazi circles were formed "to serve
the Hungarian nation . . . and to protect Hungarian culture and
language." Meanwhile, liberal deputies suggested that President Arpad
Goncz's earlier proposal to redefine what is meant in the criminal code
by combatting extremism and incitement against minority groups. --
Zsofia Szilagyi

HEROIN SEIZURE IN HUNGARY. Hungarian customs officials on 2 November
found almost 14 kg of heroin in a Bulgarian car at the Romanian border ,
Hungarian newspapers reported. The smugglers said they wanted to travel
to Western Europe with their haul. The amount of drugs seized in Hungary
so far this year totals 493 kilograms. Meanwhile, Hungary and Ukraine
the same day reached an agreement to improve coordination to curb cross-
border crime. The accord comes in the wake of a series of attacks by
Ukrainians on tourist buses in eastern Hungary. -- Zsofia Szilagyi

[As of 12:00 CET]

Compiled by Jan Cleave


Friday, 3 November1995
Volume 2, Issue 214


BUSINESS NEWS
-------------

        **AVOID SHORT TERM DEBT**
        Countries that want to avoid a Mexico-type crisis should follow
        Hungary's lead and steer clear of an excessive amount of
        short-term debt.  That's according to Christopher Huhne the
        managing director of IBCA sovereign ratings.  Speaking at a
        banking seminar in London yesterday, Huhne said that  at the
        end of 1994 Hungary had many of the ingredients of a crisis
        similar to Mexico's, including a soaring current account
        deficit that reached the same proportion of GDP as that in
        Mexico.  Also like Mexico, Hungary had a government that the
        markets didn't trust. It had delayed fiscal adjustment and
        reversed a key privatization policy.  But Huhne says "Hungary
        didn't suffer a crisis like Mexico's and wasn't shut out of
        its traditional markets."  Huhne says the key difference
        between Hungary and Mexico was that just eight percent of
        Hungary's debt was coming due within a year, whereas more than
        a third of Mexico's debt was short term.  Huhne says such a
        high dependence on short-term debt risks a roll-over in which
        the markets won't lend any more money.  Huhne says Hungary
        remains popular with retail bond investors in Japan and Europe
        despite being what he called an exception to the rule about
        post-communist countries of eastern Europe making a smooth
        transition to a market economy.



ABOUT CET ON-LINE
-----------------

* CET On-Line is Copyright (c) 1995 Word Up! Inc., New Media
  Group, all rights reserved.  Not-for-profit redistribution of
  CET On-Line in electronic format is allowed only if our
  copyright notice, and all other copyright and by-line
  information contained in this publication is included.
  For-profit distribution of this publication or the information
  contained herein is strictly prohibited without the express
  written permission of Word Up! Inc., New Media Group.  These
  conditions are subject to change without notice.  For further
  information, contact Zoltan Nagy at >

  Some portions of the news provided by special agreement with
  Reuters.  For information on Reuters news and information
  products, contact your local Reuters office.


* All "Letters to the Editor" and other comments about
  editorial content should be directed to Duncan Shiels at
  >.  Any comments about distribution or
  production should be directed to Zoltan Nagy at
  >.


**CET On-Line** is a Word Up! Inc., New Media Group
  Publication.  The New Media Group also publishes the Prague
  Financial Monitor on-line.  For more information on the Prague
  FM, send a message with the word INFO in the body of a message
  to >.

  For a copy of the latest issue of the Prague Financial Monitor,
  send a blank e-mail message to >.


**Subscription Information**
  CET On-Line is a free e-publication.  Subscribe by sending a
  message with the word SUBSCRIBE in the body of a message to
  >.  For an automated information
  response, send a blank message to >.

  To unsubscribe at any time, send the word UNSUBSCRIBE in the body,
  not the subject line, of a message to >.

  For a copy of the latest issue of CET On-Line, simply send a blank
  e-mail message to >.