Monday, 30 October 1995
Volume 2, Issue 210


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

        **SLOVAK EXPLOSION UPDATE**
        Slovak authorities have cut the death toll from a steel mill
        accident near the eastern city of Kosice to 11.  Local
        residents and environmentalists have accused them of reacting
        too slowly to a cloud of carbon monoxide which leaked from the
        VSZ steel plant after the accident on Friday.  The Slovak
        Green Party says the authorities' handling of the accident is
        another reason why the government should scrap controversial
        plans to complete construction of the Mochovce nuclear power
        plant.  A VSZ spokesman released a list of the 11 victims
        yesterday.  Officials had said all of the victims were VSZ
        workers, but the list included twin brothers who were
        unemployed Gypsies.  Residents of the village of Velka Ida,
        which lies on the edge of the sprawling complex are asking why
        they weren't evacuated until early Saturday, many hours after
        an explosion that started the deadly gas leak. VSZ spokesman
        Jozef Marko says carbon monoxide levels built up only late
        Friday afternoon when weather conditions stopped the gas from
        dispersing. But he couldn't explain why another nine hours
        went by before the evacuation started.

        Kosice is only about 14 miles north of the Hungarian border,
        and Hungary says it was prepared for the poisonous gas cloud
        if it had crossed the border.  The Ministry of Home Affairs
        says Hungarian authorities were continuously monitoring air
        quality in endangered areas.  The National Meterorological
        Office said the gas cloud didn't reach Hungary because of
        favorable weather conditions.

        **HUNGARY TO THE RESCUE**
        Hungarian Foreign Minister Laszlo Kovacs says Prime Minister
        Gyula Horn will step in to support Slovakia's Hungarian
        minority if it decides a proposed new Slovak language law is
        discriminatory.  Last week, the Slovak government approved
        legislation stipulating that public sector employees,
        including teachers, must read and write Slovak.  That brought
        protests from leaders of Slovakia's 600,000-strong Hungarian
        minority.  Kovacs says if their complaints are justified, Horn
        will try to discuss the matter personally with his Slovak
        counterpart Vladimir Meciar.  Slovakia's parliament still has
        to approve the measure., but it's expected to pass because the
        governing coalition controls a majority of the legislature.

        **PEACE TALKS PROCEEDING**
        Negotiators trying to hammer out an agreement on Eastern
        Slavonia, which borders Hungary, are going to hold parallel
        talks in Croatia and the United States.  Eastern Slavonia is
        the last part of Croatia held by rebel Serbs.  U.N. envoy
        Thorvald Stoltenberg said yesterday that he had hoped to
        finalize an agreement over the weekend but both sides raised
        objections to the plan for the region, and the Serbs want more
        time.  Stoltenberg says negotiations will continue during
        talks on an overall peace settlement for the former Yugoslavia
        starting Wednesday at a US air force base near Dayton, Ohio.
        Stoltenberg says he'll stay in the former Yugoslavia to meet
        both the Serb and Croatian sides.  Croatian Defence Minister
        Gojko Susak yesterday repeated threats to seize Eastern
        Slavonia by force.

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

        **CET'S WEEKLY MARKET ROUND-UP**
        Central European stock markets drifted mostly sideways this
        week.  Market players say major bourses in the region will
        have to get used to steady or falling prices for a while
        before any rebound.  CET's David Fink explains in this week's
        market analysis.

        The Warsaw Stock Exchange edged lower last week after two weeks
        of modest gains.  Analysts say although speculative swings
        ahead of the coming presidential vote are possible, most
        players are likely to stay on the sidelines.  On Friday the
        all-share WIG index closed at 7,846.7 points, down 5.9.
        Leszek Iwaniec, an analyst at Polish Development Bank
        brokerage, doesn't expect any sharp movements to push the
        market out of its "horizontal channel" before the November
        fifth presidential election.  Analysts say many investors may
        choose to hold back, not so much because of concern about the
        election but because of uncertainty about how other market
        operators will behave.

        The Prague Stock Exchange has recorded its fourth consecutive
        rising session.  Still, trading was sluggish in most major
        issues.  The PX50 index closed Friday at 442.2, up 1.28
        percent. While most issues plodded through the week, the
        market was given a lift after U.S.-investor Michael Dingman
        announced that his wholly-owned firm, Stratton Investments had
        bought 140 million dollars worth of shares in at least seven
        firms.  As of Friday, Stratton had identified six of the firms
        involved.  All of the companies' shares jumped on the news.
        Dealers say Stratton's move could spur other investors.  They
        may try to buy large stakes in Czech firms before new
        legislation expected to tighten minority shareholder rights is
        introduced sometime next year.

        Prices were steady to weaker on the Budapest Stock Exchange last
        week.  Traders say there aren't many signs of a strong upward
        movement in the short term.  On Friday the BUX index closed at
        1,486.21 points, down 31.79 points.  There were only four days
        of trading in Budapest last week because of a national holiday
        on Monday.  The shares of pharmaceutical group Richter took
        the spotlight.  That was due to the announcement of Richter's
        January-September results on Wednesday and fresh developments
        on the next step of privatization on Thursday.  Thirteen point
        eight percent of Richter's shares will be offered to
        international investors. A 1.8 percent stake will be sold to
        Hungarian retail and institutional investors.  Three percent
        will be made available to company management and employees at
        a price ranging between fourteen dollars and fifty cents and
        16 dollars.  While the mood on the market is still bearish,
        hopes are increasing that recent losers, pharmaceutical Human
        and OTP Bank, have reached bottom and will start to move up
        from  their current price levels which are below their 1,000
        forint face value.


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OMRI DAILY DIGEST
No. 211, 30 October 1995

LATVIA HANDS IN APPLICATION TO JOIN EU. Latvian Foreign Ministry State
Secretary Maris Riekstins on 27 October handed over to his Spanish
counterpart, Carlos Westendorf, Latvia's formal application to join the
European Union, BNS reported. Spain is currently hold the EU Presidency.
President Guntis Ulmanis and Prime Minister Maris Gailis signed the
application on 13 October. Latvia is the first Baltic State and the
fourth East European country (after Poland, Hungary, and Slovakia) to
submit applications to join the EU. -- Saulius Girnius

WORLD BANK PRESIDENT IN HUNGARY. James Wolfelsohn, during a visit to
Hungary on the weekend, praised Hungary's efforts to establish a market
economy, saying the World Bank was anxious to help the country
reestablish its economic balance, international and Hungarian media
reported on 30 October. Wolfelsohn, following meetings with top
government and central bank officials, said there is "a high measure of
agreement between [the World Bank] and the Hungarian government."
Hungary and the World Bank are currently negotiating a water quality
project for Lake Balaton, investment in the government's state treasury
system, and strengthening supervision of the country's banks. Two $400-
500 million credits are also under discussion to support entrepreneurial
and financial restructuring as well as other state budget reforms. --
Zsofia Szilagyi

MAJOR GOLD SEAM DISCOVERED IN HUNGARY. A seam believed to contain
several tons of gold has been discovered in northeastern Hungary, Magyar
Hirlap and international media reported on 28 October. The seam was
found in the Nagyborzsony region by Lone Star, an Austro-Hungarian joint
venture. Experts said it could be the most productive mine in Hungary,
where gold mines yielded around 80 kilograms a year before they were
closed in the 1970s. -- Zsofia Szilagyi

[As of 12:00 CET]

Compiled by Jan Cleave