Thursday, 21 September 1995
Volume 2, Issue 183


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

**HUNGARY RECEIVES US TOP GUN**
  US Secretary of Defense William Perry arrived in Budapest
  yesterday for a two day visit that includes meetings with
  Prime Minister Gyula Horn, President Arpad Goncz and Defense
  Minister Gyorgy Keleti.  Perry spoke to Hungarian military
  officers last night at the Zrinyi Military Academy.  He said
  Hungary is meeting all of the basic criteria for joining the
  NATO alliance.  Perry said Hungary is setting an example for
  other countries in the Partnership for Peace program.  He said
  nations that want to join NATO must meet five basic
  requirements: upholding democracy, civilian control of the
  military, a military that's compatible with NATO, good
  relations with neighboring countries and a market economy.
  Perry praised Hungary's recent austerity measures.

  "I know that the austerity that comes along with market reform
  is very difficult.  But I believe that your government in
  economic strategy is on the right track and I urge you to
  continue on that track of market reform."

  Perry said Hungary is also on track when it comes to regional
  relations.  The defense secretary praised joint military
  exercises held by Hungarian and Romanian troops.

  "Hungary is bending over backwards to be a good neighbor in the
  region."

  Perry said NATO should draw up more specific criteria and a
  time frame for expansion over the next year.  But, he
  emphasized, NATO will expand and Partnership for Peace is the
  stepping stone to membership. --David Fink


**TALKING ABOUT TALKING**
  Hungary said it's open to an historic reconciliation proposed
  by Romanian President Ion Iliescu.  But in making that
  announcement yesterday, Hungarian Foreign Minister Laszlo
  Kovacs also said the Romanian initiative appears to be a call
  for a political statement rather than a binding agreement.
  Iliescu suggested last month that the two central European
  neighbors settle their differences like Germany and France did
  after World War Two.  Hungary and Romania broke off
  negotiations in July on a bilateral treaty aimed at settling
  the sensitive issue of minority rights for Romania's more than
  1.6 million ethnic Hungarians.  Kovacs said Hungary's position
  hasn't changed since then.  Hungary still insists that
  international norms on minority rights be included in a basic
  treaty between the two nations.


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OMRI DAILY DIGEST
No. 184, 21 September 1995

HUNGARY READY TO DISCUSS ILIESCU INITIATIVE. Hungarian Foreign Minister
Laszlo Kovacs on 20 September said Hungary was open to the historic
reconciliation proposed by Romanian President Ion Iliescu but added that
the initiative appeared to be more of a "political than of a binding
character," Reuters reported on 21 September. In July, Hungary and
Romania broke off negotiations on a bilateral treaty aimed at settling
the sensitive issue of minority rights for Romania's 1.7 million ethnic
Hungarians. Iliescu suggested last month that the two Central European
neighbors should cast aside decades of mutual suspicion and acrimony and
settle their differences, following Germany and France's example after
World War Two. -- Zsofia Szilagyi, OMRI, Inc.

IMF CRITICIZES HUNGARIAN ECONOMIC POLICY. Following two weeks of
negotiations with Hungarian officials, an IMF delegation has criticized
aspects of Hungarian economic policy, Magyar Hirlap reported on 21
September. The IMF was dissatisfied with the slow pace of the social
security reform and the type of privatization deals recently concluded.
But it approved of the government's economic plans for the next three
years and its proposals to reform the state budget. Although the
delegation also expressed approval of Hungary's stabilization program to
date, it did not suggest when the long-awaited credit agreement would be
signed. Talks between Hungary and the IMF will continue in Washington in
October. -- Zsofia Szilagyi, OMRI, Inc.

ETHNIC HUNGARIANS ON ILIESCU INITIATIVE. Bela Marko, chairman of the
Hungarian Democratic Federation of Romania, has welcomed the initiative
by Romanian President Ion Iliescu for a "historic reconciliation" with
Hungary, Radio Bucharest reported on 20 September. Marko said, however,
that similar proposals and negotiations have yielded no concrete results
in the past. The issue of ethnic minorities, he added, requires a legal
solution, not just a "declaration of intentions." He also said that the
Romanian government's plan to appoint a member of the chauvinistic Party
of Romanian National Unity as a prefect of Mures County, where a large
Magyar minority lives, was "an unfriendly gesture, contrary to proposals
for reconciliation." -- Dan Ionescu, OMRI, Inc.

[As of 12:00 CET]

Compiled by Jan Cleave