SOURCE: The St. Petersburg Times
DATE: Issue #1031 (97), Tuesday, December 21, 2004
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TITLE: Putin Says Ready for EU Role in Chechnya
PUBLISHER: Combined Reports
TEXT: HAMBURG - President Vladimir Putin has for the first time showed his readiness to involve Germany and the European Union in the restoration of order in the wartorn Chechen republic, the German Press Agency reported Monday.
In Hamburg for a two-day summit with German Chancellor Gerhard Schroeder, Putin said German suggestions for the troubled republic had been very carefully analyzed in Moscow, the report said.
"We would like to adopt these suggestions fully and completely," Putin was quoted saying.
Putin showed astonishing openness with Schroeder on the crisis in the Ukraine, freedom of the press and internal reforms of Russia.
"I will be glad to speak with you in detail on these issues," he said.
A member of Putin's delegation said he is ready only for European participation in the economic reconstruction of Chechnya, not in collaboration on political aspects of the conflict.
Moscow has to date refused to accept international help in the solution of the Chechnya conflict.
Schroeder and Putin greeted each other late afternoon at Hamburg airport with an embrace.
Schroeder said he was expecting "very satisfactory dialogue in line with our very good relations.
The summit is supposed to address the improvement of youth exchanges and the economic relations as well as international questions.
The German Green Party and the opposition Christian Democrat Union called on the chancellor Monday to clearly express Germans' concerns about the state of human rights and the lack of democracy in Russia to Putin.
A Yukos lawyer accused Schroeder of complicity with Putin in the dismantling of the beleagured Russian oil group. On the edge of the summit, smaller protests by Ukrainians and the human rights organization Amnesty International were held.
On Putin's arrival Schroeder called the development of the German-Russian economic relations as "immensely healthy."
"And they should remain so and be developed even further," the chancellor said.
He was referring not only to the energy sector, he said, adding that the second main focus of the consultations would be youth exchanges, a subject dear to him and Putin.
After the preliminary conversations in Hamburg, the summit, which will involve ministers from both governments, will be continued Tuesday at the castle of Gottorf in Schleswig.
Apart from youth exchanges, agreements are to be signed on traffic, sea rescues and fighting marine pollution. The international subjects are likely to include the fight against terror and the Ukraine elections. It was not clear Monday whether the Yukos affair will play a role at the summit.
On Tuesday afternoon, Schroeder and Putin want to let the summit end on a private note in Hanover, where the president will stay with Schroeder's family.
Green leader Reinhard Buetikofer expressed the expectation in Berlin that the chancellor would not skirt around awkward subjects in his conversations with Putin.
With his interference in Ukraine elections and his construction of anti-western conspiracy theories, the Russian president has positioned himself "offside," he said. In the dismantling of Yukos, "the actions of the Russian authorities have not been in accord with their own relevant laws," he added.
Hermann Groehe, an expert on human rights in the CDU/CSU faction of the Bundestag urged Schroeder in an article in the Rhenischen Post to change course on his policy toward Russia. He accused the chancellor of going too easy on his good friend Putin when it came to human rights and the rule of law.
The lawyer of the ex-Yukos head Mikhail Khodorkovsky, Robert Amsterdam, said in Hamburg, he was angry that Schroeder was meeting Putin only one day after the auction of the most important Yukos subsidiary Yuganskneftegas. "The chancellor is supporting the expropriation of Yukos," he said.
The consultations were planned originally for September, but Putin called them off because of the hostage crisis in Beslan.
(SPT, AP)
TITLE: Yukos Says
Output Is
Declining
PUBLISHER: Staff Writer
TEXT: Yukos warned on Monday that oil production was starting to decline after its key production unit was sold off to an unknown shell company in a government auction.
Investors expressed shock at the bizarre proceedings at Sunday's sale, in which a company called Baikal Finance Group made off with Yuganskneftegaz for $9.37 billion.
The true ownership of Tver-based Baikal was still unclear late Monday, and analysts said that the longer the uncertainty lasts, the greater the risk of disruptions to oil output from Yukos.
Ostensibly the government is seeking to recoup Yukos' enormous tax debt, yet the relentless legal assault on the country's largest oil exporter is widely seen as a conflict between President Vladimir Putin and jailed Yukos founder Mikhail Khodorkovsky.
Although officials characterized the auction as "clear-cut and transparent," even the U.S. government said the murky circumstances of the sale undermined the investment argument for Russia.
"The case has eroded Russia's reputation as a place to do business,'' U.S. State Department spokesman Richard Boucher told reporters in Washington.
"We have seen a lot of different stories, some of them rather amusing, about who Baikal Finance Group is,'' he said. "But no, we don't have any further information than others seem to have developed."
The Kremlin declined to comment Monday and top ministers confessed they, too, didn't know who had just bought one of the country's main oil production units.
Yukos CEO Stephen Theede said production was already declining and could fall further unless the new owner released urgently needed cash to Yugansk.
Yukos shares tumbled 26 percent on Monday cutting the company's market capitalization to just $1.2 billion.
"You cannot run a company the size of Yukos on no money, so we are already starting to see an impact, we are already starting to see a decline," Theede said at a news conference in London, Reuters reported. "Any new owner is going to immediately have to begin making significant capital investments in Yuganskneftegaz in order to prevent production from beginning to decline noticeably in 2005."
Theede said he was working out of London because authorities were harassing Yukos employees in Moscow and threatening them with arrest.
Yukos, which accounts for about one fifth of the country's oil production, is facing a chaotic demise.
Khodorkovsky, who together with associates purchased control of Yukos from the government in the mid-nineties for $309 million, issued a statement from his prison cell calling the auction a "show" that meant the end of the company.
"The authorities have made themselves a wonderful Christmas present. The most efficient oil company in Russia has been destroyed," Khodorkovsky said.
Theede said that separating Yugansk from the rest of Yukos could take months and that a freeze on accounts is taking its toll on operations.
Fears of oil supply disruptions from Russia, the world's second biggest exporter, helped send crude prices to record highs this year.
The country's oil pipeline monopoly Transneft has not been preparing itself for any cuts from Yugansk, company vice president Sergei Grigoryev said in an interview Monday. Yugansk has its slot in Transneft's January shipping schedule at levels requested by Yukos, he said.
"It's business as usual, nothing has changed."
However, Yukos cancelled the loading of 100,000 tons of crude and delayed another 100,000-ton cargo at Primorsk, Bloomberg reported Monday.
"Although Yugansk is a separate entity [from Yukos], a lot of assets are interlinking. There must be strong likelihood that because of the vacuum it is very likely we will see crash in production, not just at Yugansk but in other subsidiaries as well," said Chris Weafer, chief strategist at Alfa Bank. "A couple of weeks of vacuum would be dangerous. People see a potential mess that could hit international oil prices in the same way as an Iraqi pipeline blowing up would."
Yugansk general director Sergei Kudryashov said earlier this month that production was falling because cash was stuck in frozen accounts. Workers and suppliers in Nefteyugansk, the home of the oil unit, said the situation was critical and that production was on the verge of disruption.
An official at Yugansk, who asked not to be named, said Monday that production was continuing as normal. The company knew nothing about its new owner, the official said.
Baikal is probably an entity for circumventing the restraining order issued last week by a Houston bankruptcy judge. Analysts have named Gazprom, Surgutneftegaz or even oil billionaire Roman Abramovich as being behind the company.
"My guess is that Gazprom will get it. It is very likely that Baikal Finance Group has some relation to Gazprom, though the relation may not be direct," said Scott Semet, head of research at MDM bank.
"This is a special purpose vehicle for Gazprom so that the company doesn't have to violate the Houston court decision temporarily banning sales of Yukos assets."
A senior bankruptcy lawyer at a major British law firm, who requested anonymity, said Gazprom might be able to avoid being in contempt of court if it doesn't have links to the entity.
"If this turns out that [Baikal] is the just the alter ego of Gazprom, then Gazprom could be found to be in breach of the court order. If it is not connected with Gazprom, then it would depend on when the plot to hatch this plan was made and if it was a concerted attempt to bypass the restraining order," the lawyer said.
However there are concerns Baikal could sell Yugansk on to Gazprom for a hefty commission or even keep the asset itself, creating a new industrial group.
"The best scenario is that they are warehousing it til legal action is over. The worst is that they will transfer it to Gazprom at a higher price and pocket the difference," said Alfa Bank's Weafer.
The Houston restraining order expires 10 days from Dec. 16.
According to auction rules, Baikal needs to pay the full $9.37 billion within two weeks of the sale. But a spokesman for the Federal Property Fund said Monday that Baikal could be given until Jan. 11 to transfer the money because of the long holiday period.
Another possibility is that the state will take direct control of Yugansk if Baikal is unable to come up with the cash and Gazprom is scared off by legal proceedings in the United States.
"If [the Kremlin] can't get past legal hurdles and Baikal can't pay, it will belong to the state. The title will be in state hands and they will parcel out management to another company," said Adam Landes, an oil and gas analyst at Renaissance Capital. "All the proceedings in the U.S. have clearly derailed [Gazprom's] plan."
But the Russian state could still face international litigation if it takes over Yugansk, lawyers said, and Gazprom may find it hard to stop the Chapter 11 bankruptcy case started by Yukos in Houston.
Group Menatep, which controls Yukos, said the auction was a farce and lawyers for the group again vowed to pursue the purchasers of Yugansk.
"It's a farce. One doesn't know if it is a front for Gazprom or for the government," said Tim Osborne, a director at Group Menatep.
"I should imagine it's just a holding vehicle to wait and see if Chapter 11 is lifted." If Yukos gets bankruptcy protection in the states, then shares will be forfeited to the government, he said.
Transneft's Grigoryev said he hasn't heard from Baikal.
"We don't know who they are. They haven't been in touch with us," he said. "Besides they can only be recognized as owners after they pay the full sum. I wouldn't risk calling then the owners so far."
Baikal Finance Group was registered this year, deputy governor of Tver region Vladimir Grabarnik told RIA-Novosti Monday.
"We have certain information but so far cannot disclose it. In a while Baikal Finance Group will introduce itself," Grabarnik said.
"It is no secret to anyone that this company is purely nominal. That the office of the company is not located at the registration address is nothing out of ordinary. It is a normal practice."
The alleged address of the shy purchaser of Yugansk appears to be central and almost posh, local residents said Monday by telephone. The three-story building hosts a store, offices and small boutiques on the upper levels, said Olga Fasilina, development manager at Tver's Karavan + Ya newspaper.
The building dates back to 19th century, she said. "This pretty much the very center of the town."
The offices of Surgutneftegaz subsidiary Tvernefteprodukt are on the same street, Novotorzhskaya, she said.
Further report, page 5
TITLE: Liberals Cry Foul Over Municipal Elections
PUBLISHER: Staff Writer
TEXT: Exit polls showed that Sunday's municipal elections drew an average turnout of only 25 percent and that City Hall organized mass fraud so deputies loyal to it were declared elected, liberal Legislative Assembly deputies said Monday.
The city election commission denied the allegations.
"Candidates who were running in the election campaign did not have the financial resources to organize any sort of mass violations," Dmitry Krasnyansky, deputy head of the election commission, was quoted as saying Monday.
City Hall has also denied the accusations and accused liberal party Yabloko of distributing leaflets with the wrong addresses of polling station in an effort to confuse voters.
Boris Vishnevsky, a member of Yabloko, said, however, that the party has nothing to do with the leaflets.
The final results for parties were not available Monday.
By Monday afternoon, the commission had declared enough people had voted for the elections to be valid in 65 municipal districts of the 67 contested.
"In the other districts, the results are still to be counted," Interfax quoted the commission as saying Monday.
In some districts the official turnout exceeded 40 percent after City Hall organized early voting a few days before election day, attracting city residents with free food packages, Internet access cards and checks to buy medicine.
Liberal legislators said that in many cases officials at the polling stations just stuffed the ballot boxes in favor of City Hall-backed candidates.
"I have never seen such frank and open fraud before, " Mikhail Amosov, head of the Yabloko faction in the Legislative Assembly said Monday in a telephone interview. "Most of it was done before election day."
"People could not find their names on electoral rolls and polling station staff refused to show them the rolls before election day," Amosov said. "Of those who eventually did get to see them, 90 percent found that they were recorded as having already voted, while they, in fact, had not."
"That's what tens of voters I spoke with said; it means that there were probably hundreds of them," he said.
Nikolai Rybakov, a Yabloko candidate in Slavyanka municipal district, in southwest St. Petersburg, got an estimated 63 percent of votes on Sunday, but only 5 percent in early votes while United Russia candidates, received 95 percent of early votes, and Rybakov failed to be elected, Amosov said.
Yabloko will summarize the cases of fraud they registered during the elections and will represent them to the public on Wednesday, he said.
Nina Shubina, head of City Hall's committee for liaison with municipal councils, rejected Yabloko's claims Monday in a telephone interview.
"They just don't want the authorities to exist," she said. "If they have any arguments they should go to court."
"We are very happy with the results which show that voters are interested and active," she said. "And the protest vote ["against all"] was not as high as predicted, just 6 percent or 7 percent on average."
"Seven hundred new lawmakers have joined the system at the municipal level and are ready to work closely with City Hall, which is a good result," she said.
But Alexei Kovalyov, a lawmaker in the Legislative Assembly's Union of Right Forces, or SPS, faction said city authorities should annul the election results in most districts because of the mass forgeries.
"This was just simple bribery of voters all through the city," he said Monday in a telephone interview. "The election results in districts where the early voting exceeded 2 percent or 3 percent of turnout should be annulled."
As an example of a successful election, Kovalyov cited the results in district No. 8 located on Sredny Prospekt on Vasiliyevsky Island where Yabloko candidates won a majority.
"Unlike in other districts, they put a stop to City Hall's attempts to bribe voters and all of the deputies, who were elected before kept their seats on Sunday," he said.
Last week, liberal lawmakers in the Legislative Assembly accused the United Russia faction of attempting to bribe voters to turn "the municipal system into a decoration."
While liberal lawmakers are outraged by the way the municipal election was conducted, the pro-Kremlin United Russia party deputies said everything was just fine.
"I don't believe there were briberies of any sort," Vladimir Yeryomenko, a member of the faction said Monday in a telephone interview. "People got presents after they voted."
"It has probably influenced the motivation of voters, but in conditions when the municipal elections are not popular among people City Hall has done a colossal amount of work to attract residents to the polling stations," Yeryomenko said.
A major surprise in the elections was thefailure of Maxim Reznik, head of the St. Petersburg branch of Yabloko, to be re-elected in district No. 74 in the south of the city, he said.
"Most United Russia candidates have got through, which is a pleasant thing for me because I believe that by showing respect for the candidates I supported, the voters have approved my work," he said.
Yeryomenko said the Legislative Assembly would consider giving more functions to municipal councils, such as responsibility for overseeing the municipal housing stock.
"If the municipalities start to be responsible for bringing order to housing, their work will be more noticed and the voters will start feeling that this branch of power is very important," he said.
TITLE: IN BRIEF
TEXT: Swedish Balloon Breach
MOSCOW (SPT) - An unmanned drifting balloon launched from a Swedish airforce base in Kiruna crossed Russian border without the permission of federal authorities, Intefax reported Friday quoting the air force.
"The balloon crossed the border at 7:15 p.m. at an altitude of 8,000 meters at a distance of 196 kilometers southwest of Murmansk," Interfax quoted air force spokesman Alexander Drobyshevsky as saying.
The balloon was launched Thursday at 3:30pm and Russia was originally informed about it at 7 p.m. that day by a call center in the Finnish city of Rovaniemi.
Envoy 'Anti-Semitic'
RIGA (SPT) - The Russian ambassador to Latvia, Viktor Kalyuzhny, was last week accused of anti-Semitism after a comment he made to Chas, a Latvian Russian-language newspaper when answering a question if Russia should apologize for the Soviet occupation of Latvia.
"Why should Russian people be guilty? The [Soviet] Secret service was headed by a Pole [Felix] Dzerzhinsky, in the Revolution Military Council there were 38 members out of a total of 44 who were Jews. From a political point of view this is not serious," Kalyuzhny said.
The words called widespread protests from cultural and political society in Riga, including representatives of the Latvian museum of Jewish history and government officials.
Paper to Investigate
ST. PETERSBURG (SPT) - Newspaper Komsomolskaya Pravda on Friday said it would investigate claims made by city sociologist Olga Tsepilova about an article in the newspaper that accused her of being a spy.
"I can report that we received a letter from Tsepilova," Alexei Ganelin, Komsomolskaya Pravda's deputy editor, wrote.
"We are seriously looking into her claims in relation to our publication on Nov. 13. You will find out from the pages of our paper if measures are taken about her claims," he added.
Tsepilova has said the article was written at the instigation of the Federal Security Service, which has been vindictive since she unsuccessfully applied to conduct an opinion poll in the closed city of Oryolsk in the Chelyabinsk region in May.
TITLE: Polls Results Mixed For United Russia
PUBLISHER: Staff Writer
TEXT: MOSCOW- In the latest round of regional elections Sunday, United Russia-backed candidates won in Kurgan and Bryansk, but another of the party's candidates lost out to Kamchatka's incumbent Communist governor, Mikhail Mashkovtsev, in a runoff.
Mashkovtsev won with 49.72 percent of the vote, beating United Russia-backed candidate Boris Nevzorov, the head of the Ust-Kamchatsky district administration.
Nevzorov received 37.61 percent of the vote, regional election officials reported.
The result was a second blow for United Russia in the region's elections, after its original candidate, Alexander Dudnikov, finished fourth in the Nov. 28 first round of voting. United Russia then switched its support to Nevzorov, who until recently was affiliated with the party.
Mashkovtsev won despite being under investigation on charges of misusing $5 million in state funds and illegally handing out salmon quotas.
In Kurgan, incumbent Governor Oleg Bogomolov was re-elected in a runoff for a third term with United Russia's backing. Bogomolov received 49.1 percent of the vote in the runoff. His rival Yevgeny Sobakin, a businessman from the Moscow region, received 40.1 percent of the vote, Interfax cited regional election officials as saying.
Sobakin's bid had been initially backed by the Union of Right Forces, or SPS, but last Thursday he said that he wanted to join United Russia.
The runoff in Kurgan had originally been set for Dec.5, but was postponed for two weeks by a regional court.
The election campaign in the region was marked by attacks and threats against campaign officials, Russian media reported.
An unidentified attacker threw a grenade into the window of Sobakin's campaign headquarters in Kurgan. The grenade hit a campaign employee in the head but did not explode. Local prosecutors have opened a criminal investigation on hooliganism charges.
United Russia's Nikolai Denin, a State Duma deputy, won the election race in Bryansk. Denin, who had been little known in the region until recently, received 77.83 percent of the vote.
His closest rival, Yevgeny Zelenko, a candidate supported by SPS, received 10.32 percent of the vote, almost the same as the vote "against all" candidates, regional election chief Viktor Goncharenko said, Interfax reported.
Incumbents won in the Republic of Marii-El, where President Leonid Markelov secured 56.54 percent of the vote, and in Khabarovsk, where Governor Viktor Ishayev received 85.36 percent of the vote.
Three more regional elections - in Khakassia, Ulyanovsk and Volgograd - will be held next Sunday, in the last votes before a Kremlin plan to replace direct elections comes into effect.
From Jan. 1, the president will submit candidates' names to regional legislatures for their confirmation. The plan was approved by both the Duma and the Federation Council and signed into law by President Vladimir Putin last week.
TITLE: 'Window' Design Wins Competition
PUBLISHER: Staff Writer
TEXT: An architectural design titled "The Window To Europe" has won a competition for the best passenger terminal for the city's seaport.
The up to $500 million, 400,000-square-meter terminal is to be built on reclaimed land covering 49 hectares on the edge of Vasilevsky Island. It will be able to process 1.2 million passengers a year.
The design, developed by the Moscow-based creative group Reserv, was among three finalists.
"In our design, our group aims to reflect the image of St. Petersburg as a link between Russia and Europe," architect Vladimir Plotkin, who heads Reserv, said at a presentation of the design on Friday.
Apart from being shaped like a symbolic window frame, the giant terminal will feature a modern system of hydraulic engineering, a spacious terminal building and an extensive real estate complex comprising business centers, tourism infrastructure and residential apartments.
St. Petersburg's chief architect Alexander Viktorov welcomed Reserv's project as the most original submission.
"Our choice of winner has a particular importance because the city's marine facade makes an important contribution to the visitors' first impressions of St. Petersburg," Viktorov said. "The competition showcased very interesting projects, while the "window" appears to be the most reasonable and creative."
Although the project is crucial for the city's tourism industry, a private company created specifically for the development sponsored the competition for the best passenger terminal.
The limited liability company called Marine Facade of St. Petersburg was founded a year ago with an eye on the seaport development plans, company director Alexander Bogun said at the project's presentation Friday.
He refused to say how much money his company is ready to invest into the construction, but spoke confidently about the firm's resources.
"Our resources are vast," he said. "Organizations cooperating closely with us have up to 200 years of experience. It doesn't matter what form of ownership we have. It is important what our financial resources are - and they are substantial."
A tender for investors in the development is in progress with results to be announced in spring. Bogun predicted investors will get their money back in five to six years, with most of the profit being generated from tourists.
The city government will invest $90 million into the construction of a deepwater channel leading to the city. The existing channel is very narrow and quite shallow, which prevents modern foreign vessels from navigating local waters, he said.
It is expected that some of the new facilities will start operating in 2007, when the first stage of the terminal's construction will be finished.
TITLE: IN BRIEF
TEXT: Rubens Lawsuit Mulled
BERLIN (Reuters) - The German government is considering filing a lawsuit over a painting by Rubens taken from Germany by a Soviet officer after World War II that is being restored in the State Hermitage Museum.
Der Spiegel magazine on Sunday cited German Culture Minister christina Weiss as saying that the painting "Tarquin and Lucretia," which hung in Potsdam's Sanssouci Palace until 1942 would be the subject of Russian-German government consultations Monday and Tuesday.
The minister had asked a Munich-based legal institute to examine the legal status of the painting, which Russian prosecutors say is the private property of collector Vladimir Logvinenko.
The institute's analysis said Logvinenko had not bought the painting in good faith, and must return it, Der Spiegel reported.
Consul's Car Robbed
ST. PETERSBURG (SPT) - The car of the Finnish consul general was robbed this weekend, Fontanka.ru reported Monday, quoting the city police.
On Saturday at about 3:30pm an unidentified criminal smashed a window and got into the Mitsubishi Pajero car parked at 4 Grivtsova Ulitsa.
Consul General Kauko Jamsen, 61 is missing 14,000 rubles ($500), 200 euros, a consulate ID card, a bank card, insurance certificate and business cards.
The police have initiated an investigation.
Russian-Speaker Neglect?
TALLINN (SPT) - Russian-speaking students of schools in Tallinn are worried that they will not get a good education and job, Interfax reported Friday, quoting a survey conducted by newspaper Postimees last week.
A fifth of respondents said that even when results of examinations are the same, Estonian-speaking students are more likely to be accepted than Russians.
The Estonian Education Ministry denied that there was serious discrimination.
"According to the latest data 35 percent of graduates from Russian speaking schools and 40 percent of students from Estonian speaking schools are continuing their education in institutions free of charge," Interfax quoted Aire Kolk, head of the ministry as saying.
TITLE: Duma Seeks to Grant
FSB Sweeping Powers
PUBLISHER: Staff Writer
TEXT: MOSCOW - The State Duma on Friday passed a controversial counterterrorism bill that would give security services sweeping new powers to declare a state of emergency in case of "terrorist danger" and restrict media coverage of terrorist attacks.
Deputies passed the bill - drafted by the Federal Security Service, the Interior Ministry, the Prosecutor General's Office and the Justice Ministry - on a first reading by a vote of 385-47, with one abstention.
The only opposition to the bill, drawn up in reaction to the Beslan school massacre and other terrorist attacks that killed more than 440 people in August and September, came from the Communist Party and a handful of independent deputies. Critics of the bill said it was an attempt to increase the powers of the siloviki and a further attack on civil liberties.
But in a sign the bill could be toned down in later readings, a Kremlin envoy and the government criticized some of its provisions, which they said contradicted constitutional law.
The bill, aimed at replacing a 1998 counterterrorism law, would allow the FSB to declare a state of emergency in an area threatened by "terrorist danger" for up to 60 days, based on information - even if unverified - about preparations for a terrorist attack.
Under such a state of terrorist danger, security services could monitor private communications, ban demonstrations and prevent the movement of people and transportation. But some rallies and vigils would not be forbidden, Duma Security Committee member Anatoly Kulikov told reporters Friday.
Under the bill, the power to declare the state of emergency would reside with the head of the counterterrorism operations headquarters - a ranking FSB officer appointed by the prime minister.
Under the existing law, a state of emergency can be called for the duration of a counterterrorism operation.
The bill does not specify how often a state of terrorist danger can be declared.
The bill also sets out legal procedures allowing the military to participate in counterterrorism operations, including for the first time those beyond Russia's borders, under the overall direction of the FSB, the country's lead counterterrorism agency.
The bill would oblige journalists to cover terrorist attacks only within limits set by the FSB's counterterrorism operations headquarters. It was not clear from the bill whether all media outlets covering a terrorist attack, including those not reporting from the scene, would need to obtain FSB permission, or whether the headquarters would have the authority to block media coverage.
The government on Friday criticized some of the bill's restrictions on public gatherings and media coverage, distributing a document to Duma deputies that said some of the bill's provisions were "self-contradictory."
"Article 29 of the bill, which stipulates the order and conditions of informing the population about events linked to an act of terror, should be substantially amended, since in its current form the article contradicts the key points of the Media Law," the document said, Reuters reported.
The document said that restrictions on people's movements and public gatherings should only be enforced "during a state of emergency and only in accordance with federal constitutional law."
President Vladimir Putin's envoy to the Duma, Alexander Kosopkin, said Friday that Putin supports the bill, but will propose a series of amendments.
Leaders of United Russia's Duma faction, Vladimir Pekhtin and Lyubov Sliska, praised the bill Friday, saying it would streamline counterterrorism efforts by different agencies.
Communist deputies strongly opposed the bill, saying it would "sow political, ethnic and religious instability in society." It is not the bill's poor legal basis, but "legal arbitrariness, corruption in [law enforcement] agencies, the decay of state institutions and poor economic conditions" that are undermining counterterrorism efforts, Communist Deputy Alexei Kondaurov said.
Nationalist Rodina deputies voted for the bill, but voiced concerns over its restrictions on the media.
Yet despite assurances by some Duma deputies that the bill would be toned down to reduce the impact on civil liberties, there is no political force in the country that could lobby for improvements in the legislation, analysts said.
"Russian laws, including this bill, are specifically designed to leave room for interpretation by individual officials," said Vladimir Pribylovsky, an analyst with the Panorama think tank. "It allows them the discretion to apply the full force of the law against someone who has committed a small violation, and to forgive a gross violation."
Typically in the Duma, amendments protecting rights and freedoms would be introduced in a later draft, but that is unlikely this time, said Pribylovsky and Yury Korgunyuk, an analyst with the Indem think tank.
"After squashing independent media and liberal parties, there is no political force left in Russia that could act as a check on the siloviki," Korgunyuk said. "Also, after the West reacted so sheepishly to the legal assault on Yukos and the scrapping of regional elections, the Kremlin has lost its fear of looking bad in anyone's eyes."
TITLE: Vandals Desecrate Jewish Cemetery
PUBLISHER: The St. Petersburg Times
TEXT: Vandals desecrated dozens of Jewish gravestones and the synagogue at St. Petersburg's main Jewish cemetery Thursday night.
"Jews Get Out of the Country," "Long Live the Holocaust," "Heil Hitler," the signs written on the synagogue said. The gravestones are covered with swastikas and SS signs, the St. Petersburg Jewish Community said.
"We are disturbed and worried by this action of vandalism," said Mark Grubarg, head of the St. Petersburg Jewish Community. "Unfortunately, we have recently faced more and more cases of xenophobia."
"It is a deed of the worst kind to defile something sacred," he said. "And it's so low to fight the dead."
Such vandalism contradicts the declarations of President Vladimir Putin that nationalism should not be tolerated. Police should take more measures against such actions, Grubarg said.
"Such actions present a big danger for a multi-ethnic state like Russia," he said.
In February, vandals damaged about 50 Jewish graves and painted swastikas at the cemetery.
An investigation was opened, but no one was charged.
Police are considering opening a new investigation, Interfax reported.
The cemetery in the Nevsky district is the former Preobrazhensky Cemetery, and is partly Jewish and partly the burial site of the victims of Bloody Sunday in 1905, when Tsarist troops shot people who petitioned Tsar Nicholas II.
TITLE: Radio Liberty Reporter Stripped of ID Papers
PUBLISHER: The Associated Press
TEXT: MOSCOW - Yury Bagrov, a correspondent for Radio Liberty and a former Associated Press reporter, was fined and stripped of his identity papers Friday after a North Ossetian court found him guilty of using falsified documents to obtain a Russian passport, his lawyer said.
Bagrov, who wrote on the Chechen wars, said he was convinced the case was trumped-up and retribution by the Federal Security Service for his work.
Bagrov was fined 15,000 rubles ($540) and failed to win back the passport proving Russian citizenship. Prosecutors alleged that a judge's signature had been forged on a court document used to get the passport in 2003 in Vladikavkaz.
Bagrov's lawyer Alexander Dze-pikhov said his client's request to have the signature verified by specialists outside North Ossetia, where he lives, was turned down, as were other procedural motions by the defense. Except for his high-school diploma, the court also declined to return other identity documents seized by FSB agents last summer.
If the decision is upheld, Dzepikhov said, Bagrov would be stateless and lacking any residence permission in Russia. The North Ossetian Supreme Court will hear an appeal by Bagrov next month.
Prior to obtaining the Russian passport, Bagrov had been a citizen of the Soviet Union. Bagrov, 28, was born in Tbilisi, the capital of the then-Soviet republic of Georgia, and moved in 1992 to Vladikavkaz, where he lives with his Russian wife.
FSB agents searched the homes of Bagrov and his mother last August. They confiscated his computer, address books and copies of articles, suggesting the case was connected with his reporting. "I was told I should have learned to hold my tongue," Bagrov said, referring to warnings he said he routinely received from FSB agents against reporting on sensitive topics.
Dzepikhov said the verdict was not supported by evidence and was "nothing more than a reprint of the accusation."
TITLE: Students Urged to Act on Summer Travel
PUBLISHER: Staff Writer
TEXT: As winter arrives in St. Petersburg, the city's travel companies that specialize in student exchange programs are already advising local students to start thinking about the warmth and promising opportunities of next summer.
"If a student wants to go on a student exchange program in the U.S. or U.K. to work and rest there the following summer, he'd better apply for it already," said Steve Caron, president of Sindbad Travel.
Although the application period for many of Sindbad's programs started on Sept. 1, 2004 and runs until April 1, 2005, it is important to start gathering documents for the program well before students plan to leave, he said.
"From beginning to end the process can take several months: to interview and test the student, to find and confirm their job/position in the U.S. or U.K., to process all the documentation and receive permission for the student to apply for their visa, to reserve an interview time at the consulate, etc," Caron said.
The waiting list for consular interviews, scheduled to be conducted from early April to early July, can be up to one month, he added
Yulia Isakova, coordinator of the work and travel program for students at Star Travel, said their deadline for students' applications is Feb. 1.
Student programs, which allow young people to work and travel abroad during their summer vacation, are rather popular among students. For them it's a good opportunity to make some money and to get to know another country.
Lyudmila Anikeyeva, 20, a third-year student at St. Petersburg State University, worked last summer as a lifeguard at swimming pools of resort town Wisconsin Dells, Wisconsin. "During that visit I practiced my English, learned about life, and made many friends from different countries," said Anikeyeva, who went through Sindbad's program.
The United States is a favored destination for clients of Sindbad and Star.
Caron and Isakova said work & travel programs are the most popular among students, and that almost all applicants receive visas.
The program, designed by the U.S. Department of State, is for students age 18-24 with good English. The program offers an opportunity to live and work in the U.S. for up to four months during their summer break from studies.
It costs about $800 to $1,000.
Most jobs offered under such programs are seasonal and in the service sector. Many employers offer housing. Students usually manage to make enough money to pay for the entire program including travel expenses and come back with some pocket money, Caron said.
"The average amount the student returns with is $1,500 but some students have come back with much more. It depends on how hard a student works and the type of job they choose."
Anikeyeva said the program cost her a total of $1,700, but after four months work she came back with three times more money.
"Of course, to make the money I had to do a second job, that is work as a hostess in a cafeteria right after my lifeguard shifts but it was worth it, though it was hard," she said.
Another program that attracts students is Camp America - USA in which students have the opportunity to be camp counselors or support staff during their summer vacation at camps in the U.S.
Jeffrey Murray, American Consul for Press and Cultural Affairs in St. Petersburg, said in 2004 the city's U.S. consulate issued about 1,500 visas for work and travel students from northwest Russia and Kaliningrad.
The vast majority of students who applied for visas in 2004 received them.
At the U.S. port of entry Russian students are, like all visa holders, subject to processing, including questioning by a Bureau of Customs and Immigration agent which reviews their visas and checks on biometrics, he said.
TITLE: Supreme Court Refuses
To Grant Election Appeal
PUBLISHER: Staff Writer
TEXT: MOSCOW - The Supreme Court on Thursday rejected an appeal by the Communist and Yabloko parties to invalidate the results of last December's State Duma elections, which they claimed had been distorted by biased media coverage during the campaign and vote rigging.
The court also rejected an appeal that claimed the pro-Kremlin United Russia party deceived voters by including politicians on its party list who later refused to become deputies, including Moscow Mayor Yury Luzhkov and Emergency Situations Minister Sergei Shoigu.
International monitors called the elections, held Dec. 7, 2003, unfair. Central Elections Commission chairman Alexander Veshnyakov denied that any major violations took place in the election campaign or vote count.
Yabloko and the Communists had joined forces with Committee-Free Choice 2008, a group including liberal presidential candidate Irina Khakamada, in a bid to hold the commission responsible for the alleged violations.
"We did not expect the Supreme Court to go against the Kremlin," Yabloko deputy leader Sergei Mitrokhin said Thursday. "However, we have achieved our main goal: We have drawn public attention to the fact that the vote was rigged and the campaign was unfair, and we have raised this issue in the country's highest court."
Vadim Prokhorov, a lawyer for Committee-Free Choice 2008, said he would make a further appeal. "The court rejected most of our appeals, while only one out of 100 witnesses was questioned. We were denied the right to conduct a defense," Interfax quoted him as saying.
Communist Party lawyer Vadim Solovyov said the decision would be appealed in the European Court of Human Rights.
Elections commission member Sergei Bolshakov rejected the criticisms. "Everything mentioned here is nothing but assumption, someone's personal opinion, which, in our opinion, does not stand up at all," he said.
In the elections, liberal Yabloko and the Union of Right Forces, or SPS, failed to break the 5 percent barrier to enter the Duma, while the Communists lost half of their seats.
TITLE: Kremlin's Smokescreen
Hides Chechnya Truth
PUBLISHER: Staff Writer
TEXT: MOSCOW - When President Boris Yeltsin convened his Security Council in late 1994 to approve the deployment of troops to Chechnya, NTV television had four crews in the republic and elsewhere ready to cover the war.
As soon as armored convoys started rolling into Chechnya on Dec. 11, 1994, NTV and other Russian television crews scrambled to provide up-to-date coverage of Russia's first post-Soviet military campaign, reporting from both of the warring sides. Risking their lives, both television and print journalists documented and analyzed the cruel war as it unfolded.
A decade after the devastating first siege of Grozny, much of the city remains in ruins, but most Russians will not see that at home because national television channels are now glossing over the news out of Chechnya in line with the Kremlin's policy to create the impression that life in the republic has returned to normal.
The extent of the devastation is so sugarcoated that even President Vladimir Putin, who initiated the second war in September 1999, expressed shock after a visit to Grozny last May. "We need to look again at the reconstruction of Grozny. Despite all that is being done there, it looks horrible from a helicopter," Putin told the Cabinet hours after his trip.
The first war convinced the Kremlin more than any other event that it needed to control national television channels - which most Russians rely on for news - to successfully undertake any major national policy.
"Even if those in power were not happy with the media's coverage of events during President Yeltsin's rule, journalists were not persecuted. The military could criticize them, but no measures were taken against them," said Vyacheslav Izmailov, a retired Army major who covered the war for the weekly Novaya Gazeta and helped to secure the release of federal soldiers captured in Chechnya.
Shocked by gory images of federal servicemen burned in their tanks by Chechen rebels, the public became increasingly critical of the first war as it dragged on, and the Kremlin eventually backed down and negotiated a peace agreement with the separatists in August 1996.
By the time the second war began, however, federal authorities had designed and introduced a comprehensive system to limit the access of journalists to Chechnya and shape their coverage.
Journalists complying with the rules had to rely on spokesmen of the federal troops on the ground or, in Moscow, on Putin's longtime Chechnya spokesman, Sergei Yastrzhembsky, or the officials who showed up for regular off-the-record briefings at the Rosinformtsentr press center, which was specifically set up to provide the Kremlin's spin on the war.
"It became impossible to work," said Maria Eismont, who covered both wars for the now-defunct Segodnya, a newspaper in Vladimir Gusinsky's former media empire. "The first thing the authorities did was to stop even snippets of information from coming out of there. In addition to that, we were not allowed to get into Chechnya."
Eismont was echoed by Alexander Yevtushenko, who covered both conflicts for U.S. government-backed Radio Free Europe/Radio Liberty. "The attitude toward journalists completely changed," he said. "While we were friends of the authorities in the first war, it was impossible to get a word out of the military in the second war. Nobody would talk, even ordinary soldiers. They were instructed not to."
Correspondents who tried to sneak across battle lines to get the other side of the story from the rebels were often subjected to harassment and intimidation. The murky kidnapping of Radio Liberty correspondent Andrei Babitsky in Chechnya in January 2000 served as a stark reminder of what might happen to those who did not play by the official rules for journalists in Chechnya.Babitsky was then swapped for federal soldiers held captive by Chechen fighters in an exchange clearly staged to discredit him. He was freed in neighboring Dagestan in February 2000, only to be arrested on charges of carrying a forged passport. Babitsky and his colleagues have blamed Russian special services for his problems.
More recently, Babitsky was prevented from flying to Beslan to cover the school hostage crisis in September. He was detained at Moscow's Vnukovo Airport after airport security said they thought he might have explosives in his suitcase. When he was released, several young men started hassling him, and airport security detained him on suspicion of hooliganism.
Anna Politkovskaya, Novaya Gazeta's award-winning Chechnya reporter, fell sick on a flight to Beslan and later said she believed she had been poisoned, while a number of Russian and foreign journalists complained of being hassled at the scene of the hostage-taking.
Kremlin spin doctors were only able to put a complete smokescreen around the republic once all of the national television channels were under its control. The Kremlin made its move against the channels shortly after Putin became acting president on Dec. 31, 2000. Privately controlled NTV and ORT, now Channel One, were the obvious targets when they stepped up their criticism as the military campaign slowed down that winter. Both were finally wrested away from their private owners soon after Putin won the presidential election in March 2000, and their coverage of the war subsequently became less and less critical.
The conduct of radical Chechen separatists has also influenced the media's coverage of the war. Rebels have been linked to the 1999 apartment bombings, the Dubrovka and Beslan hostage crises, and multiple suicide bombings in Moscow.
"Journalists are also a part of Russian society. You have friends and neighbors telling you that the Chechens are not doing the right thing, and your point of view changes," Eismont said.
In addition, the kidnapping for ransom of Russian journalists - including an NTV crew and the channel's star reporter from the first Chechen war, Tatyana Masyuk, in 1997 - turned some in media circles against the Chechen rebels even before the second war began. "You cannot write objectively about someone who thinks more about a bag of money than a person," said Alexei Simonov, head of the Glasnost Defense Foundation media watchdog.
These factors, combined with Kremlin pressure, have made it nearly impossible for journalists to provide balanced coverage of Chechnya.
"Censorship is now the rule of the game in Chechnya," said Oleg Panfilov, head of the Center for Journalism in Extreme Situations. "The republic is an isolated territory. We do not get any information from there. Comparing our press now to what it was during the first war would be like comparing the European press to the North Korean press."
TITLE: Cameroon
Student Dies
PUBLISHER: The Associated Press
TEXT: ROSTOV-ON-DON - A Cameroon student died after being in the custody of immigration officials for about 26 hours, prompting a protest by hundreds of foreign students at Rostov-on-Don State University.
Students, primarily from African countries, are calling on university officials to force authorities to determine the cause of death for Clarice Gerardin Mbango, who had been a journalism and philology student at the school since last year.
Mbango had been taken into custody as an illegal immigrant. Mbango appeared at the school in November seeking to enroll but by that time university administrators had already canceled her student registration - and her student visa status.
After being detained by police Dec. 7, Mbango was ordered to leave the country and sent to an immigration processing center in Shakhti. On the evening of Dec. 8, she was taken to a hospital in an ambulance after she said she felt ill. She lapsed into a coma and died the next morning.
TITLE: IN BRIEF
TEXT: Abductions Increase
MOSCOW (SPT) - The number of Russians and foreigners reported as kidnapped crept up to 1,893 in the first 10 months of this year, police said Thursday.
The number is 11 times higher than 10 years ago, Yury Demidov, a senior Interior Ministry official, said, without providing comparative figures from last year, Interfax reported.
Nine victims were killed after relatives failed to follow police instructions or failed to report the abductions and tried to make ransom payments, he said.
He said those kidnapped included citizens of the United States, Germany, France, Cyprus, Slovakia and Israel.
FSB: St. Pete Targeted
MOSCOW (AP) - Federal Security Service director Nikolai Patrushev said Thursday that authorities have information about planned terrorist attacks in St. Petersburg and the surrounding region, Interfax and Itar-Tass reported.
He gave no specifics about the alleged plans. No major terrorist attacks have taken place in the area.
TITLE: Holocaust Chronicler's Story Must Be Told
PUBLISHER: Special to The St. Petersburg Times
TEXT: A little girl is dancing on the stage, with the ease of a butterfly gliding from flower to flower. All of a sudden the sky darkens and a huge lurking spider is slowly approaching its prey. The little girl is scared, tries to escape, she is writhing in pain, pleading for mercy, crying her heart out. But the threads of the dark net are pulling together mercilessly, leaving no room for escape. The little girl breaks down, as if a bullet hit her.
For the then 14-year-old Masha Rolnikaite, watching this scene as it was performed by the dancing class of the Vilnius Ghetto, it went without saying that the lurking spider embodied fascism, which had spread over most of Europe. Like millions of Jews, she had been captured in the cobweb of fascism, out of which only several thousands would escape.
"The reason I survived is mere chance; I was lucky not to be among those who were slain by the Nazis," Rolnikaite said, sipping tea as she retold her terrible story in her apartment in St. Petersburg. Outside the snow began to fall lightly and it was hard to imagine what hell this woman had gone through 64 years ago.
More than six million Jews perished at the hands of the Nazis. A lot has been written about the Holocaust, some may even say it is time to close this bleak chapter of 20th century history. But while the fate of Jewish communities in Germany, the Netherlands or Poland is well covered, little is known about the obliteration of Jewish culture in the Baltic States.
Across Lithuania some 200,000 Jews - more than 94 percent of the pre-war Jewish community - fell prey to the gruesome hatred of Hitler and his willing accomplices - a higher percentage than in any other country Hitler occupied. By the end of 1941, even before the Endlösung, the "Final Solution", was decided in Berlin, Lithuania was declared judenfrei (free of Jews), a Nazi euphemism for successful ethnic cleansing of an area by deportation or murder.
SS-Standartenführer Karl Jäger kept a meticulous record of the annihilation of the Lithuanian Jewish community; the place and exact date of death of all victims were listed as if these figures belonged to an accountancy department.
The report concluded with the figure 137,346. "In Lithuania there are no more Jews, apart from Jewish workers and their families. The distance between from the assembly point to the graves was on average 4 kilometers to 5 kilometers, "the report said.
Before the war, Vilnius was famously dubbed the "Jerusalem of the North" as it had developed an extremely rich Jewish culture. All across Europe Vilnius earned praise for its thriving Yiddish-language theaters, libraries, schools and its Talmudic scholars. Jewish Lithuanians called themselves "Litwakes," many becoming famous beyond the Lithuanian borders.
Apart from Lithuanian Jewish writers like Abraham Mapu, Abraham Sutzkever or Eisik Meir Dick, the "Jerusalem of the North" was also the birthplace of numerous other famous artists. Violinist Jascha Heifetz and Mark Chagall, the world-famous painter, were Litwakes, to name just a few.
IN THE CLUTCHES
OF THE BLACK SPIDER
The now 78-year-old Rolnikaite is not only a contemporary witness of Hitler's crimes, but also recorded her experiences in a diary, which has become an important document of Vilnius's Jewish past. Keeping a diary was common at the time.
"We confided our little worries and teenage problems to our diaries, like, for example, what grade we got, what book we read, and what movie we watched," she said.
With the invasion of the German troops on June 24, 1941, she continued keeping track of her everyday life out of habit. Rolnikaite considers her diary not "a heroic deed," as people often like to think, but as a child's wish to tell her fate.
"In our classroom a large map of the world hung on the wall. And I understood that there were countries where there was no Hitler. And the people living in these countries had to learn the truth about what was happening to us."
The threatening black spider with the swastika on its back was weaving its lethal net slowly. While Masha's father was able to flee the country and join the Red Army, Masha's mother was trapped with her three daughters and one son. Immediately after the German invasion, the first orders - stating that Jews were not allowed to walk on sidewalks; that they had to sew the yellow Star of David on all visible clothing, and forbidding Jews to enter public places such as shops or cafes were issued.
"At first, I felt not so much afraid as ashamed to go out onto the street," Rolnikaite remembers. "My classmates and teacher walked on the sidewalk and I had to walk on the street like a horse."
On her 14th birthday, Masha decided to wear her light blue silken dress. She left home without her yellow star and ran through the narrow streets of Vilnius to her hairdresser to have her hair cut. It would be the last time she strolled the streets of her beloved city. In September 1941, the family was forced to move into Ghetto 1. The German troops had established two Ghettos, Ghetto 1 and Ghetto 2, separated by Deutsche Gasse, the German Lane. Ghetto 1 was designated for craftsmen and workers with permits, and Ghetto 2 was to be for all others - the elderly, workers without permits, and orphans. Six weeks later, Ghetto 2 was eliminated. "What does ghetto mean?" the 14-year-old Masha asked. "What is life like in a ghetto?"
Living in the ghetto meant dilapidated housing, poor hygiene and unbearable congestion. It was calculated that in the 72 buildings in Ghetto 1, the average living space per person was 1.5 to 2 square meters. The killing never stopped.
In nightly Aktionen (raids), German Einsatzkommando (task force) units tried to hunt down Jews not holding yellow certificates, which had the status of work permits. Those arrested were later marched to the Ponar forest eight kilometers away, shot, and buried in mass graves. Ponar became the symbol of horror. More than 70,000 Lithuanian Jews, most of them from Vilnius, were murdered at this place.
The Germans did not get their own hands dirty when carrying out their bloody business.
"Lithuanians worked as guards. In general, the Germans only gave orders. Lithuanians did the shootings. They got a work permit and were allowed to keep money and other valuables they found on the dead bodies", Rolnikaite remembers.
As testified by the reports of Einsatzkommando unit A, the rapid annihilation of the Jews of Lithuania was only made possible because of the willing participation of the local population. Exploiting the superstitious anti-Semitic prejudices of the local people and their hatred of the Soviets, the Germans made use of these willing collaborators to round up and kill Jews. In Vilnius, Lithuanians roamed the streets, capturing Jewish men and hauling them away, supposedly for work. The activities of these Lithuanian auxiliaries were so in tune with German plans that by the end of July 1941, 20 local police battalions were formed. Between a half and two-thirds of all Lithuanian Jews were killed by local militia.
But even in the darkest night there is some glimmer of hope. The teacher Henrikas Jonaitis, who provided Masha and her family with food and moral support, was just one of many Lithuanians who assisted the Jewish community and tried to relieve their plight at the risk of their own lives. An Austrian soldier, Anton Schmidt, hid Jews in the basement of a mattress workshop and arranged for their transfer to Belarus in military trucks. The German secret police, the Gestapo, executed him.
Rolnikaite does not like generalizations that describe whole ethnicities in terms of black and white. "Just as it was completely untrue that all Jews were bad, not all Germans were barbarous butchers. It is wrong to generalize."
Under the leadership of Itzik Witenberg the United Partisans Organization, or F.P.O. attempted to rouse the population to fight their persecutors. "All the roads of the Gestapo lead to Ponar. And Ponar is death! Let us not go as sheep to the slaughter!" its leaflets said. Yet their armed resistance was ineffective and on July 16, 1943, Witenberg was forced to hand himself over to the SS.
Another form of resistance was offered by the means of art.
"Art is spiritual resistance," Rolnikaite says. "At the beginning of 1942, some intellectuals gathered to found an arts organization to force people not to lose their pride in themselves."
This organization created a choir, a theater, dancing classes and an orchestra.
"It was difficult to run the choir. After every Aktion some singers were missing and they had to be replaced by new ones. People were tired after their hard work, and many were in mourning and did not want to sing. There was also a library, and people would read. I used to sit on the staircase of our house and read. I just wanted to escape from this nightmarish reality."
Despite the Jews' hope of imminent liberation by the approaching Red Army, the ghetto was emptied on Sept. 23 and 24, 1943, and in the general confusion Masha was separated from her mother and brother and sister. "Goodbye, my child! At least you will live! Take revenge for our babies!" This was the last time Masha saw her mother. Taiba Rolnikaite and her younger siblings Rajele, 9, and Ruwele, 7, were murdered, in all probability, in a concentration camp. Rolnikaite has never found out where they perished.
Masha and 1,700 other women considered capable of work were transferred to the infamous concentration camp Kaiserwald north of Riga, and later to the nearby concentration camp Strasdenhof. The young girl was to experience sadistic tortures, hunger and forced labor. When the Red Army was close to Riga, the concentration camp was liquidated and the imprisoned women were brought to the Stutthof extermination camp near Danzig, which is now the Polish city of Gdansk.
At Stutthof, the furnaces worked day and night. The prisoners' shacks were unheated and had no water. When a typhoid epidemic broke out, numerous women did not survive the fatal disease. In her diary Masha remembers these days of horror. "It is a genuine death camp. The Germans do not bother to keep order. There are no roll calls any more: they are indeed afraid of entering the shacks."
Masha's diary ends with the evacuation of Stutthof and the three-week march through abandoned territory. When the women were gathered in a barn to be burned, a vanguard of the Red Army arrived and liberated the prisoners. By that time Masha weighed only 38 kilograms. A Soviet soldier carried Masha out of the barn. "Do not cry little sister. We will not let evil happen to you ever again".
BEGINNING OF A NEW LIFE
In March 1945, Masha was given a second life. She immediately returned to Vilnius and learned that her father and eldest sister had survived the war. "It was very hard for me to get back to normal life. When I went out on the street, I unconsciously sought the yellow star. I had to force myself to walk on sidewalks. If a person gave me a menacing look, I got scared and thought what he might do to me".
Masha's father wanted her to go back to school to catch up on her missed education. "At first, I refused to go to school. Why is it important to know mathematical formulae or where the Mississippi lies". But then she gave in, attended evening classes and later enrolled at the Gorky Literature Institute in Moscow.
Masha soon started to restore her diary. She had destroyed her notes when the Aktionen started to occur increasingly often. If her notes were found, the Germans would kill the whole family, her mother had warned her. Masha burned her diary and tried to keep it in her head. When dragging heavy buckets filled with water at a farm, she counted the number of buckets to train her memory. Later on, in the Strasdenhof concentration camp, she ran over her experiences in her mind while dragging heavy stones.
"This helped me to preserve my sanity. And long after the war, when I was studying at the institute as an external student, I never finished studying on time and got little sleep the night before exams. If I could remember 10 telephone numbers and some part of the diary in the morning, I knew that my mind was working and I took the exam. If not, I went to bed again to have some more sleep."
Therefore, her diary reads like prose, without dates. But when she was creating it she had not intended to publish it. It was important to survive, to look ahead to the future even when dark clouds were looming on the horizon.
In her introduction to the German edition, the German journalist Marianna Butenschön described Rolnikaite's diary as written from the point of view of a child who had grown up overnight.
"This is why the text is so interesting, and Masha was a good observer," she writes.
Rolnikaite was not the only chronicler of the ghetto in Vilnius but the obliteration of the Litwakes was also documented by Hermann Kruk, director of the Ghetto library, and by the journalist Grigory Schur. Their observations confirm each other's versions.
Ninety percent of Rolnikaite's diary, restored from her memory, corresponds with to the original diary, Butenschön says in the introduction.
The remaining 10 percent of non-identical text concerns "individual words, expressions or idioms but do not concern facts", Rolnikaite said.
After the German troops had been defeated, Jewish cultural life started to revive in Vilnius. Abraham Sutzkever and Shmerke Kaczerginski founded a Jewish cultural and arts museum in the building that formerly housed the ghetto library.
The Jewish actor Solomon Mikhoels, who was also director of the Jewish theater in Moscow and president of the Jewish Anti-Fascist Committee, visited the museum.
Mikhoels learned about Masha's diary and borrowed it from her. He stayed up all night reading it, but explained afterward that it would shouldn't be published because the Jewish community shouldn't shed tears about what had happened in the past but build up a new culture for the future.
Mikhoel's reaction aroused perplexity and a terrible foreboding among the Litwakes, which would soon to be fulfilled. On Jan. 13, 1948, the Jewish community was shaken by news that Mikhoel had died. As it turned out later, Mikhoels had been murdered by the NKVD secret police. His death marked the beginning of the Stalinist persecution of Jews, who were defamed as "homeless cosmopolitans."
A large number of Jewish intellectuals were arrested and deported to Siberia. The Jewish theater in Moscow was closed, the streets and lanes in the Jewish quarter in Vilnius were renamed and Jewish tombstones were used as construction material all over Vilnius.
"The Jewish community had collected money to put up a memorial to the Jews murdered at the execution site of Ponar," Rolnikaite said. "In 1952, the memorial was leveled to the ground one night and replaced by a rather modest obelisk devoted to all Soviet victims of fascism. There was not a single word about the Jews."
With Stalin's death, the wave of anti-Semitism subsided and Masha submitted her diary to the publishing company for scientific and political literature in Vilnius. Some months later, she received the required report.
For Masha the assessment read "like a death sentence". The diary was described as not written from the correct class position - the Jewish Council was depicted in too positive a light, and Soviet partisans were not given the deserved attention. First, Masha refused to carry out the required changes, later she was prepared to compromise.
The famous Jewish-Russian writer Ilya Ehrenburg, who had been awarded the Stalin prize and was notorious for his biting, strongly anti-German writing, first agreed to write the introduction of the Russian edition but later changed his mind. The manuscript of his sixth book had been returned to him with more than 134 comments, out of which he only considered 60. Ehrenburg feared that he would only harm her if he wrote the introduction.
It was not until 1963, almost 20 years after the end of the war, that her diary was printed in Yiddish under the title "I Must Tell." Two years later a censored Russian translation was published. Moscow sold the manuscript to foreign publishing houses and boasted that the Soviet Union had its own Anne Frank.
"The Diary of Anne Frank," written by a teenage Jewish refuge whose family hid in the Netherlands, is one of the most widely read tales of the Holocaust. Frank's family were betrayed and she perished in the concentration camp Bergen-Belsen.
Rolnikaite does not like to be compared with Frank. "Anne Frank is famous through world. And I understand that her name was invoked to promote my book. But I do not want to be compared to her. Anne Frank is dead but I am still alive."
Rolnikaite's book was translated into 18 languages and published in 24 editions. But the shadows of her past have not ceased to hunt her. And she feels bound to tell her story over and over again by reading her diary to the public and visiting schools to talk to the younger generation about her experiences.
"When I was first invited to visit East Germany after the publication of the German edition, everybody asked me why I had agreed to take this trip. But I answered that I had to go to Germany. I needed to distinguish the Germany I got to know from the Germany of today".
HUNTING THE SHADOWS
OF THE PAST
In the meantime, Rolnikaite has visited Germany five times. Her latest trip was to Nienburg, a small town in western Germany, where she was invited to talk about the Holocaust to pupils of a German high school. Although traveling has become difficult for the 78-year-old woman she had accepted the invitation. "The pupils there really did not know anything. Only one boy said that he read "The Diary of Anne Frank." But they were interested and asked questions."
Some pupils asked her whether she could forgive the German people for what happened to her. Rolnikaite does not experience any hatred. "I cannot forgive the SS people. But I do not feel any hatred towards other Germans."
At the age of 14, Masha had given herself the promise "to enjoy every single minute of my life if I survive all this". Looking back, she admits that she has not always been able to keep her promise - especially in moments when her fight against "the lurking black spider" appeared to be fruitless.
In 1967 for instance, Franz Murer, the "expert on Jewish affairs" who supervised Vilnius from 1941 to 1943, for which he was also called "The Butcher of Vilnius," was acquitted by an Austrian court. Rolnikaite cannot understand this decision as she herself had witnessed Murer murdering numerous Jews.
And today fascism seems to have gained new power, even in the city where she lives, St. Petersburg, where thousands died during the Siege of Leningrad from 1941 to 1944.
"It is incomprehensible that the grandchildren of those who died under the Nazi regime join racist movements. Once, my husband and I were going home by metro when we noticed a young man, dressed in a black uniform with a swastika symbol on his right sleeve. Nobody paid any attention to him."
The fact that present-day Russia is experiencing a strong swing to the right is often overlooked by the West.
A right-wing subculture has been developing in most major Russian cities and this trend does not seem to be coming to an end. On the contrary, right-wing extremism has been continuously spreading since the authorities not only do little to control them, but critics say they even support it. The police harass people with Caucasian and Asian appearances by random passport controls, extort money from their victims, beat them up and abuse them. Racially motivated attacks are often ignored or classified as hooliganism.
Friedrich Schiller announced in his "Ode to Joy" that "all humans will become brothers."
In Rolnikaite's opinion this wish will not be fulfilled.
"It seems that there is something evil in the human soul. Why did people join the SS? Some people obviously are defective. Bruno Kittel, for instance, was an actor and musician before he joined the SS. Strange things happen when you give a person power."
Rolnikaite has been writing books her whole life. And all of them revolve around the one topic - the Holocaust of the Jewish community. Writing has become her way to survive.
"I want to give those a voice who did not survive the Holocaust. By talking about my experiences I feel I am doing something useful ... I am contributing to the fight against racism and exclusion."
TITLE: City Aims for a Legal Taxi Market, Investors Keen
PUBLISHER: Special to The St. Petersburg Times
TEXT: St. Petersburg administration intends to begin strict regulation of the city's taxis in order to create a "legal taxi market".
The initiative comprises an accreditation program for all taxi operators and the setting up of conditions to encourage large taxi companies to invest in the sector, said Igor Mailov, deputy head of the St. Petersburg Transport Committee at a press conference earlier this month.
One of the possible investors, Moscow-based New Transport Company which runs under a brand name "New Yellow Taxi", has already announced plans to launch in St. Petersburg. The company already occupies about 50 percent of the legal taxi market in Moscow. New Transport Company will put 300 vehicles on St. Petersburg streets in early 2005, reported news website Fontaka.ru. The number of cars should increase to 1,000 by the end of the year.
At present, more than 8,000 taxis operate in the city, with only about 700 registered legally (compared to 1,500 vehicles two years ago), according to the transport committee data. The rest of the vehicles work on the so-called gray market.
"This creates an abnormal situation both from the tax and security point of view", Mailov said.
According to the Russian Association of Taxi Firms, the St. Petersburg market consists of four comparatively large taxi operators, and about 20 smaller companies. In addition, about 40 taxi call centers work in the city, almost none of which have their own fleet of cars. Taxis are still rather unpopular with the majority of the St. Petersburg population. Speaking in a phone interview Monday, research agency Toy-opinion said that according to their statistics 77 percent of St. Petersburg inhabitants did not use taxis at all. Furthermore, 15 percent took a taxi less than once a month, while only 2 percent used this method of transport weekly.
In the meantime, more than 35 percent of St. Petersburg citizens regularly ride with private drivers (the chastniki).
The transport committee's initiative to legalize the market. It will force all taxi operators and private taxi-drivers to obtain city accreditation. The city will also allocate specific taxi parks at about 120 locations in the town. Finally, St. Petersburg authorities promise to support large investors who are willing to develop the legal taxi market in the city.
Alongside New Transport Company plans, new possible investors on the market are expected to come from the existing route taxi companies (running the marshroutka minibuses). One such company considering the expansion into taxi operations is Trety Park.
"The growing number of legal taxi operators in St. Petersburg will stimulate competition, leading to the improvement in quality of services and lower prices," said Mikhail Bogdanovsky of the Russian Association of Taxi Firms.
And most importantly, Bogdanovsky added, "that will bring down prices of official taxis to the level of private drivers".
TITLE: RusAl Begins Project in South America
PUBLISHER: The Associated Press
TEXT: GEORGETOWN, Guyana - After agreeing to buy 90 percent of shares in Guyana's state-owned bauxite company, Russian Aluminum plans to spend $10 million to study the feasibility of setting up an aluminum plant in the South American country, officials said Friday.
Officials from RusAl, which belongs to metals magnate Oleg Deripaska, have discussed setting up an aluminum plant that could process 1 million tons of bauxite per year, said Mike Brassington, the head of Guyana's government privatization agency. No decision will be made, however, until the feasibility study is completed in about three years, he added.
Brassington estimated it would cost about $1 billion to build the aluminum plant.
On Thursday, RusAl signed an agreement to buy 90 percent of shares in the state-run Aroaima Mining Co. in eastern Guyana. The Russian company agreed to spend $20 million over several years to improve the mine's production.
The company will be known as the Bauxite Co. of Guyana Inc., and production should increase from 1.3 to 2.5 tons per year by 2006.
TITLE: VimpelCom Shares Plummet Over Fears of Second Tax Bill
PUBLISHER: Staff Writer
TEXT: MOSCOW - Shares in VimpelCom plunged 20 percent Friday on reports that the country's No. 2 mobile provider was about to be charged more than $300 million in unpaid 2002 taxes.
Earlier this month VimpelCom, better known to consumers under the Bee Line brand name, received a $158 million claim for 2001 back taxes, rattling investor confidence and sending the stock market into a tailspin.
Reports of the possibility of a new tax charge Friday evening caused VimpelCom's New York-traded American Depositary Receipts to dip 20 percent. The shares recovered only after tax officials and VimpelCom issued denials of a new claim. The ADRs closed at $29.38, down 6.46 percent.
Interfax and Itar-Tass reported new tax charges for 2002, citing sources in the Federal Tax Service. Interfax also said authorities had prepared back tax charges against VimpelCom for 2003.
Itar-Tass later withdrew its report, while VimpelCom spokesman Mikhail Umarov said the company had not received any new claims.
On Saturday, Deputy Finance Minister Sergei Shatalov cast doubt on the validity of the first tax claim. The ministry will make a decision this week on whether the charges for 2001 are justified, Interfax reported.
"We are discussing the issue with the Federal Tax Service," Shatalov said. "We simply want to sort things out in this situation. We want to find out whether the claims made by the tax authorities are justified."
VimpelCom, however, has indicated that it is prepared for the worst. Vice president Valery Goldin said Thursday that he could not rule out new back tax claims for 2002 and 2003, especially if tax officials would not accept VimpelCom's response to the 2001 claim, Reuters reported.
VimpelCom's practices that reportedly caught the attention of state officials and led to the 2001 tax claim continued in the following years.
TITLE: SPIBA Lobbying Forces Report
TEXT: Summarizing the activities of the SPIBA Legislation & Lobbying Committee in 2004, we can conclude that the Committee worked on a broad agenda addressing major problems related to business and investment in St. Petersburg and North-Western Russia, which covered tax, customs, real estate, securities, and foreign currency regulation issues highlighted by SPIBA members. We have begun new projects that we expect will generate significant immediate benefits for businesses in St. Petersburg as well as continue to build on SPIBA's efforts for permanent structural improvements in the regional business climate.
We continue our efforts to promote SPIBA members' common interests and cooperates closely with federal policy-making institutions. Thus in autumn we submitted our proposals on a draft law "On amendments of the Law of the RF "On Customs Tariff" to the State Duma of the RF, which were taken into consideration. The key purpose of our proposal is to prevent the deterioration of the customs regime for businesses, and the Committee is going to keep this direction.
SPIBA's coordination with the local authorities is developing and getting more effective. As a result of such coordination, the draft law" On Additions to the St. Petersburg Law "On Tax Concessions" granting profits tax and property tax concessions to investors passed the St. Petersburg Legislative Assembly and will be signed by the governor soon. This issue was initiated by SPIBA a year ago and we are proud of the result, proving that together companies may maintain a successful and mutually beneficial dialogue with the authorities.
Also, the Committee initiated and organized various seminars and briefings, which covered topics specific to the interests of investors such as taxation, customs regulation, commercial real estate acquisition, and the creation and implementation of a policy for St. Petersburg urban planning.
SPIBA members are welcome to participate in the Legislation & Lobbying Committee. Also, we ask you to inform us about issues of your concern to equip the Committee with ideas to effectively lobby the improvement of the business environment in North-Western Russia. Please contact Natalia Kudryavtseva, SPIBA Executive Director.
Co-Chairs of the Legislation & Lobbying Committee are:
Sergey Alexeev, Baltika Brewery
Dmitry Babiner , EY Law
Irina Grave, Fortum Power and Heat OY
TITLE: SPIBA Companies' News
TEXT: Baltika Brewing Company takes care of the veterans of the Great Patriotic War.
Baltika Brewing Company has decided to take part in the social program of the St. Petersburg's government, organized for the invalids and veterans of the Great Patriotic War, and survivors of the siege of Leningrad.
The company is going to spend 1,000,000 rubles for buying household goods (TV sets, refrigerators, washing- machines). Baltika Brewing Company will present them to the invalids and veterans of the Great Patriotic War of the St. Petersburg's Vyborgsky district. The information about every invalid and veteran will be given by the Administration of the Vyborgsky district.
"Baltika" is a socially responsible company. Over the time of its existence, the company has spent a lot of money for the charity and sponsorship, supporting culture, sport and healthy lifestyles.
In November, City Realty sponsored an International performance by the St. Petersburg Chamber Philharmonic Orchestra (St. PCP) featuring Jeffery Meyer, the artistic director and Oskar Espina Ruiz soloist. The St. PCP is a non profit classical music group that promotes artistic exchange between Russia and the International community - bringing together very talented young Russian and foreign musicians. The concerts that they give are always free and we highly recommend attendance at the events. In the future, we will send out notices to both SPIBA and the St. Petersburg Times regarding these exceptionally interesting and enjoyable, non profit productions.
Reksoft developed a new version of Barsum Wi-Fi - a comprehensive system for billing and access control of Wi-Fi network (subscribers gateway & billing solution).
Barsum Wi-Fi was launched in December, 2003 and has already been installed in a number of hotels among them being "Penta Renaissance" (Moscow), "Scandinavia" (St.Petersburg), "Volna" (Nizhny Novgorod), "Renaissance" (Samara).
Barsum is a family of call accounting and billing solutions for traditional telephony and Wi-Fi networks, which has over 3,000 installations in Russia, with customers like Avaya, Cadbury, Central Bank of Russia, Ernst & Young, Gazprom, Gillette, Radisson SAS.
The US-Russia Center for Entrepreneurship (CFE), as part of our mission to accelerate entrepreneurship in Russia, participated in Management Career Day at Herzen State University. To help prepare future managers for careers in business, CFE will sponsor a series of seminars for students participating in Career Day, and we donated to the university library copies of "Taming the Wild East", a book of interviews with Russian entrepreneurs published by CFE's founder, the U.S. Russia Investment Fund (Delta Private Equity Partners).
Chambers Global 2004, one of the premier international legal rating organizations, has recognized many of Salans' offices, practice groups and individual practitioners as leaders in their fields and markets. Indeed, 26 individual Salans partners were cited as leading specialists. St. Petersburg Managing Partner Glenn Kolleeny was identified as the firm's "powerhouse" in St. Petersburg, where he heads a "seamless team," according to clients that participated in the Chambers research.
Salans has also been identified as one of the fifty leading law firms worldwide by Global Counsel 3000, the definitive guide to the legal market and regulation of lawyers in over 70 jurisdictions across Africa, Europe, the Middle East, Asia-Pacific, and North and South America.
Such recognition is the fruit of the hard teamwork, dedication and continual striving for excellence in the service of the Firm's clients by its partners, associates and staff over many years.
TITLE: SPIBA welcomes its new members!
TEXT: Ancor St. Petersburg L.L.P. . Eco Services OOO
. P & O Nedlloyd
. RMC CoLtd.
. SEB Russian Leasing
ANCOR is one of Russia's largest recruitment companies offering a wide range of HR services including Professional search and selection, Express recruitment, Large-scale projects, Outstaffing, Temporary staffing, Staff leasing, Personnel testing, assessment and audit, Salary surveys, Regional projects.
We have been operating in the recruitment market since 1990, and have acquired a deserved reputation as leaders of our business niche.
One of ANCOR's chief advantages is a network of 19 regional offices operating under a single trademark. This allows us to search for personnel and render HR consulting services in the entire territory of Russia, as well as other CIS countries.
"Eco Service" OOO provides technical building maintenance services, engineering services, HVAC and automation solutions for a wide range of buildings and facilities - industrial, commercial and retail.
Eco Service is primarily focused on servicing the engineering systems which are critical to keeping a building fully operational at all times, e.g. heating, ventilation, electricity, water. The company's objective is to assist clients in maximizing efficiency by reducing energy consumption and costs.
P&O Nedlloyd is one of the world's leading providers of point-to-point container shipping services.
P&O Nedlloyd is the fourth largest in the world by fleet capacity, and operates a modern fleet of 154 container ships with a total nominal capacity of 416,732 teu. P&O Nedlloyd's ships call at 229 ports in 94 countries with the support of more than 400 offices in 156 countries.
The company continues to make investments in ships, IT systems and people P&O Nedlloyd continues to develop its E-Commerce capabilities to offer customers a wide choice of channels including system to system (EDI), Internet services (www.ponl.com) and INTTRA (www.inttra.com), the liner shipping industry's first Internet portal.
RMC research and consulting corporation was established in 2001.
The current array of services rendered by RMC has been developed in two directions: research and consulting.
Being a consulting company RMC is involved in strategic marketing, operational marketing and marketing auditing.
The main directions of RMC as a research company are:
Market research in:
. Industrial goods;
. Consumer goods
. Services;
. Mass media.
The service market research belongs to one of the main directions for RMC.
The experts of our company have led projects and provided recommendations for the clients' strategic moves in the following markets: www.rmcgroup.ru
SEB Russian Leasing
The SEB Group (Skandinaviska Enskilda Banken Group) is a North European financial banking group for companies, institutions and private individuals, with 670 branch offices around Sweden, Germany and the Baltic States. SEB has more than 4 million customers. The Group is represented in 20 countries around the world and has a staff of about 18,000.
SEB Russian leasing is 100% owned by SEB Group. We provide financial leasing services to foreign and large and middle-size Russian companies acting in Russia.
TITLE: Offshore Funds Can Be Naughty and Nice
PUBLISHER: Special to The St. Petersburg Times
TEXT: MOSCOW - The word "offshore" has a certain mystique to those who have never been part of it. People often suppose that investing offshore is not only a bit naughty, but must necessarily be expensive. It can be both, but doesn't have to be.
For most expats, offshore banking and investment offers opportunities for greater tax efficiency, confidentiality and the ability to take advantage of international investing, free of the restrictions that often apply in high-tax countries.
These freedoms depend on your residential status and the tax rules in your home country. For most expats a period of nonresidence will do wonders for their bank accounts but for some nationalities - U.S. citizens, for instance - being an expat is not enough to escape home taxes.
The reasons people may opt for offshore banking services are diverse but there are three main incentives.
First is the security of the banking system and low currency risks. In Russia, it is "difficult to forget and forgive a [banking] system that failed so many people in the late '90s," said Nigel Whiting, principal of Provision Financial International, who divides his time between Britain and Russia.
The convenience factor of being able to receive and deposit funds remitted from your home country, or income earned from working in Russia, in any one of a number of hard currencies is extremely attractive.
"Anyone who has tried to open a U.S.-dollar account in the U.K., for example, or vice versa will already be able to testify," said Alan McGregor, a Moscow-based financial adviser with AVC Advisory.
Secondly, interest earned on bank deposits or capital gains is low-tax or free of tax for nonresidents.
A third reason for banking offshore is the financial diversification it offers.
"Investors can access assets, instruments and products which are more than likely not accessible from one's home country," McGregor explained.
Many offshore banks offer a range of services and options, including: instant access accounts with credit card facilities; fixed-term deposit accounts, with the interest rates tiered according to the length of the term and the size of the deposit; and conventional variable-interest deposit accounts, which may offer higher rates than fixed-term accounts.
Offshore bank credit cards can be used much in the same way as onshore credit cards. However, according to Lowtax.net, one of the largest Internet resources on tax and offshore materials, offshore credit cards are secured, which means the client has to provide a deposit that ranges between 125 percent and 200 percent of the credit limit requested.
There is generally a minimum amount required for opening an offshore deposit account, and due to recent legislation designed to prevent money laundering, identification is usually required, despite the claims of some shady service providers to offer "fully anonymous" offshore banking.
The extra costs of taking advice, opening new bank accounts and phone communication at a distance mean that offshore investment is unlikely to be worthwhile for less than, say, $25,000, according to Lowtax.net. Still, costs are coming down all the time because of the Internet. Offshore banks will take deposits down to $1,000, but for a personalized private banking service, you will need to deposit $100,000 or more.
According to Whiting, an adviser will generally charge around $150-$200 per hour.
Vadim Smirnov, a $300-per-hour consultant with Offshore Consulting, said it takes between 15 minutes and a week to open an offshore account.
The rate on deposit accounts is typically between 3.5 percent and 6.5 percent, which is not high compared with the 9 percent offered by many Russian banks, but offshore assures greater security, and the interest is not taxed.
However, offshore tax planning is complex and makes sense mostly for high net worth individuals, experts said.
"In terms of tax planning for the majority of individuals living in Russia, given Russia's low resident tax rate of 13 percent on most types of income, it doesn't usually make economic sense to undertake complex offshore tax planning," said Nancy MacEntee, senior manager with Deloitte & Touche CIS.
Depending on your situation, financial status and degree of openness to risk, in addition to banking there are a variety of offshore investment options open to you as well. These range in risk from low-yielding bond funds to highly-geared hedge funds, so there is something for everyone.
The offshore jurisdiction you choose for banking or investments will depend on a number of personal and business circumstances such as your country of residence, wealth, tax-planning structures, and others. You should also consider the jurisdiction's political and economic stability, legislature, professional infrastructure, communications network and geographical location.
Andrei Bokser, a lawyer with Amond & Smith's, said that Swiss banks steadily attract Russians, with the Baltic states becoming popular due to their proximity. As for U.S., British and French nationals, according to Whiting, they tend to choose from the Channel Islands, Isle of Man, Bermuda, British Virgin Islands, Cayman Islands and Luxembourg.
TITLE: Russian Realty Turns Attractive
PUBLISHER: Staff Writer
TEXT: CANNES, France - Just a few years ago, Russia was way off the radar screen of most international retailers, developers and investors. But if last month's MAPIC retail exhibition in the south of France is any indication, it is now among the world's hottest locations.
With more than 6,000 participants from all over the world, MAPIC is Europe's largest retail exhibition - and the number of Russian participants more than doubled from last year to some 85 companies, while the number of Russian stands also skyrocketed.
"After 1998 [the financial crisis], nobody wanted to talk about Russia, but now it is the exact opposite," said Mark Stiles, managing director at Stiles & Riabokobylko, the Moscow affiliate of Cushman & Wakefield Healey & Baker.
In addition to the "big four" consulting firms - Colliers International, Jones Lang LaSalle, Noble Gibbons and Stiles & Riabokobylko - Russia was represented by stands from Sberbank, Donstroi, Leeds Property Group, Park House/Vremya Group, Hyperestate, LVN Development, TsUM, Torgovy Kvartal, PIK Holding, and the Russian Shopping Center Council, among others.
"In the past there were barely any Russians - and the ones that were here often did not come for business, but to go shopping and enjoy the French Riviera. There were hardly any Russian stands," said Sergei Gipsh, general director of Colliers International in Russia.
Motivation to see Cannes is still strong, but as the Russian retail market is booming, local developers and investors now go to MAPIC chiefly to do business, he added.
"This is our first visit to MAPIC and it went extremely well - we met new partners, both Russian and foreign, and are definitely planning to participate next time," said Alexei Mogila, chief development officer at Leeds Property Group, which presented its ambitious development plan for the Moscow region's Dmitrov area.
Among the Russian retail projects presented at MAPIC were the massive Raduga shopping center that French construction giant Vinci is planning to build in St. Petersburg, Donstroi's Alye Parusa retail chain, and Mercury's "Luxury Village" boutique development in Zhukovka, west of Moscow.
Reflecting the growing interest in Russia, there was a conference session devoted exclusively to the country's retail potential - the only other two regional sessions were devoted to China and the Middle East.
And there is still room for continuous growth, as Russia, with 9.2 square meters of shopping center space per 1,000 inhabitants, is ahead only of Ukraine, Bulgaria, Bosnia-Herzegovina, Romania and Serbia in the whole of Europe, according to a report on European shopping center development that was presented by Cushman & Wakefield Healey & Baker at MAPIC.
For comparison, there are 301.9 square meters per every 1,000 inhabitants in the Netherlands and 93.9 square meters in Poland, while the average European Union figure is 155.4 square meters. By its total area of existing modern shopping centers - 1.32 million square meters - Russia is roughly on the same level with the likes of Denmark, Switzerland and Turkey.
This leaves room for significant growth, and more than 1.2 million square meters worth of new shopping centers will appear in Russia by the end of 2005 - more than anywhere else in Europe, with the exception of Spain (1.3 million square meters) and Italy (1.7 million square meters), according to the report.
"The biggest trend for the coming years will be further expansion of retail developments into the regions. As Russia's economy grows and Russian people become increasingly wealthy, we believe that the market can absorb as many as 50 new developments each year over the next 10 years," said Natalya Oreshina, head of retail at Stiles & Riabokobylko.
Indeed, while Moscow-based projects constituted a significant portion of Russian retail developments presented at MAPIC, projects from St. Petersburg and other smaller cities such as Samara, Nizhny Novgorod, Krasnodar, Chelyabinsk, Tolyatti, and even the likes of Kaluga and Dmitrov accounted for the majority.
"This trend for better representation of regional projects is a new phenomenon, which will only strengthen in the following years," said Jeff Kershaw, director of retail at Noble Gibbons in association with CB Richard Ellis, adding that it was only logical as investors and retailers are turning their attention to the regions.
TITLE: The Traveling Troubleshooter Who Came Back For Service
PUBLISHER: Special to The St. Petersburg Times
TEXT: "I'm very lucky, I don't suffer from culture shock," says Tim Eagland, relaxing in front of the big screen in St. Petersburg's Vegas sports bar and casino. Eagland is lucky in this respect, since his career in the hotel and catering industry has meant he has had to apply his skills in such diverse locations as London, Australia, Zambia, Botswana, South Africa, Russia, Egypt, Ukraine, and, most recently, Russia again.
In 1995 Eagland landed a job in Moscow, and immediately he came across prejudices that existed regarding Russia. "When I said I was going to Russia, they said to me 'what are you going there for? It's dangerous - the mafia and the crime rate... ' In 10 years I've never had a problem. I feel far safer in Moscow than I do in London. People like bad news."
Like the rest of Russia in the late '90s, Eagland was affected by the collapse of the economy. He left Russia to work in Egypt for six months before a slump in the tourism market provoked by a series of tourist bombings encouraged yet another move.
"I try to adapt to wherever I am, but maintain my standards at the same time; it's vital to stay professional," says Eagland.
Despite years in the business, Eagland admits he started in hotel and catering by chance. "I didn't know what I wanted to do, really, but I loved it from the start."
Eagland began his career working in large hotels in London. After five years, he was transferred to a hotel at Heathrow. "Watching the planes taking off, I wondered what it would be like to work where they were landing instead of where they were taking off," he says.
Eagland's very first trip took him to Australia for a year, which at first satisfied the travel itch. Three months back in the U.K. and he was looking abroad again. This time it was Zambia.
"I had to look in the atlas to see where it was," Eagland says laughing. "Then, I ended up staying 10 years."
Next came stints in Kiev, then England, but Eagland was brought to Russia for the second time, along with a reputation as an effective troubleshooter.
"I was delighted. St. Petersburg is a very beautiful city. It's one of the places I would always like to come back to."
"The biggest challenge in this city is embedding a service culture to the personnel. Before I got here, it seems as though you weren't supposed to interact with the clients. That's the opposite of service culture.
"The personality of a bar is provided by the people that work there. Trying to get that personality out of them is the biggest single problem that I have faced: they are very reserved in this part of the world."
Eagland is pleased with the improvements that have been made since his arrival at Vegas and feels that the sports bar has found a comfortable niche on the St. Petersburg market.
"There are other sports bars around, but none of them have the number of channels that we have. For the Russians who come here, Zenit are very popular, obviously. The supporters are very knowledgeable and very passionate. For the last few weeks, we've had the White Knights Rugby team. Because of them, interest in Rugby is really starting to pick up."
Russell Ward, the general manager of Vegas is enthusiastic about the improvements since Tim Eagland's arrival: "He's got good experience with Russian and European customers and staff, so the bar is run the right way for both sets of people. He's a non-stop worker."
Since he began working in the hotel and catering industry, Eagland admits that the status of the profession has changed in the eyes of the general public.
"Back when I started, this wasn't a prestigious line of work to be in. If you said you were in hotel and catering, people would think - 'you mean you're a waiter, or something?'"
He puts the current change in perception down to a more traveled generation. "The majority of people these days have traveled somewhere else in the world. That means they have experienced good and bad food and service first hand - and probably realized how important and difficult it is."
Asked about his plans, Eagland says he has no intention of moving on in the near future: "I like being here - it's a challenging environment. More so, because I'm working in a second language. If life was easy, it wouldn't be very interesting, now would it?"
TITLE: Russia Forgets What Is To Its Own Advantage
PUBLISHER: Special to The St. Petersburg Times
TEXT: Russia's competitive advantages in relation to other countries have not improved in the last three years and in some cases they have even deteriorated.
Russia lags substantially behind its Baltic neighbors, especially Finland, which the World Economic Forum (WEF) has ranked as the second most competitive country in the world for the last two years.
Russia must demonstrate a competitive economy, a business and product culture that really competes, and particularly with its neighbors. Countries that base their strategy on competitive advantages, not raw materials, have higher growth and more stable economies.
Russia's problem areas highlighted in the report are the heavy burden of bureaucracy and red tape, corruption, public institutions and property rights. In fact, Russia's position regarding 'Contracts and Law' and 'Corruption' have significantly worsened since 2001.
All of these points have resulted in many foreign companies delaying their entry to the Russian market, have kept those already involved to a minimum presence, and inhibited the development of small- and medium-sized enterprises in Russia.
Foreign companies play a crucial role in knowledge transfer (latest production techniques, management skills, customer service, and so on) in developing economies. At least part of the reason for Russia's lack of competitiveness is the limits and difficulties which foreign companies face in doing business in Russia
The Stockholm School of Economics' Sergei Morgulis-Yakushev presented research on Russia's competitiveness and what can be done to improve it at a seminar presented by the school, the St. Petersburg International Business Association and The St. Petersburg Times.
The research was based on the WEF's Global Competitiveness Report (GCR) and the work of Harvard professor Michael Porter, author of "The Competitive Advantage of Nations."
The GCR measures the competitiveness of more than 100 countries, asking business leaders on issues such as the law, corruption, business environment, technology, education, and labor. The results are then compiled into the Business Competitive Index (BCI), which measures current business competitiveness, and the Growth Competitiveness Index (GCI), which measures the future growth potential of a country by evaluating its technological development, public institutions and macroeconomic environment.
Researchers at SSE took data from the GCR report for the last three years, excluded new countries which had joined the survey, and studied Russia' ranks and scores over the period. In those three years Russia's position among 75 selected countries moved from a rank of 58 to 59 in the BCI, and from 63 to 61 in the GCI.
Porter has identified three stages of economic development:
1) the Factor Driven Economy, based on raw materials or cheap labor;
2) the Investment Driven Economy, where competitive advantage has moved to the country's firms being efficient at producing standard products and services, and having technology that is accessed through licensing, joint ventures, foreign direct investment and imitation;
3) the Innovation Driven economy, in which competitive advantage is based on producing innovative goods and services using the most technologically advanced methods.
Russia's economy is still at the Factor Driven stage. To move to the Investment Driven stage the government must work on providing efficient infrastructure, a business friendly government, strong investment incentives and access to capital to allow major improvements in productivity.
Furthermore, the government should look to developing "clusters" in industries that it already possesses an advantage in. Clusters are "geographically proximate groups of related and interconnected companies, suppliers, service providers and associated institutions." For example, the car industry in Germany, or electronics in South Korea.
Two possible clusters for the Northwest region of Russia are food processing and information technology outsourcing. The food sector is already dynamic in the region with 10 percent of Russia's food supplies being produced here. The IT industry is building on Russia's highly educated population. This sector is developing, but requires government support and encouragement to allow it to develop to its full potential.
Estonia has a strong IT sector particularly due to the investment of Finnish IT companies, highlighting the importance of trade and foreign investment in a country's development.
However, the government must take an active role in supporting, not intervening, in cluster development, through encouraging investment, training and infrastructure growth. It needs to support factors vital to the economic development of a country: tariff and non-tariff barrier liberalization, an improved anti-trust policy and opening the market for corporate control. That and improving of the country's public institutions, will enable Russia to develop into a more competitive, wealthier nation.
Thea Mills is a research associate at the Center for International Business at the Stockholm School of Economic, Russia.
This is an abridged form of the article posted on the Stockholm School of Economic, Russia's website www.sseru.org under Working Papers. http://www.sseru.org/materials/wp/
wp04-102.pdf
TITLE: Between a Rock and a Hard Place
TEXT: This Sunday, President Vladimir Putin's government will realize one of its key ambitions. Gazprom will almost certainly win the auction of Yukos' main production asset, Yuganskneftegaz. By doing so, the state will have restored its previous control over a big piece of an industry that is not only the most important element in the local economy, but, along with natural gas, is increasingly the modern equivalent of military might.
To investors that have suffered from the actions of the government and its bureaucrats over the past 12 months, the state is doing more than just acquiring an asset cheaply at their expense; it is also taking on the mantle of chief corporate governance aggressor. The probable real damage from the Yukos/ Menatep case is that investors will use a much higher risk premium when considering any investment in Russia. This in turn may slow foreign investment into Russia, accelerate capital flight and ultimately cap the price that investors are willing to pay for an investment.
The Yukos/Menatep case has shown that the government is much more interested in pursuing its own policy objectives and in pushing its vision of an industrial model to sustain GDP growth than it is in protecting the interests of private industry. Recent opinion polls show that while Putin's personal popularity rating remains very high, people's confidence in his government's ability to deliver on expectations is declining.
It seems Putin is determined to deliver on expectations by increasing the economy's dependence on the natural resource industries, particularly oil and gas, and to control these by means of greater regulation, higher taxation and by positioning Gazprom at the industries' core. Effectively this amounts to nationalization by stealth.
Political stability and economic predictability are the two cornerstones for investment in any emerging economy. While both of these conditions still exist in Russia today, the government's actions during the course of the Yukos/ Menatep case have added a serious conditionality to them. This is the risk that arises when a government with unchallenged political control is determined to fuse political and economic objectives in order to push a growth model that delivers short-term gain at the expense of real economic restructuring. The net effect is that the economy is becoming even more vulnerable to the commodity price cycle.
The fact is that bureaucrats in various state agencies over the past year seem to have regularly pursued their own independent course of action. The other, even more worrying possibility is that while the Cabinet is very good at establishing policy goals, it simply does not have the support infrastructure in place to achieve these goals. Hence the confusion following from their actions.
A good example of this can be seen with the recent slowdown in the rate of growth in the economy, despite the continuing high level of oil and gas export revenues. The problem is that while the state's tax take is very high, especially in oil, this cash is simply going to increase national savings. This money is not funding the planned budget initiatives due to a lack of progress in administrative, economic and structural reforms.
Hence Russia is in danger of falling between the rock of declining private sector investment (because the state is taking so much cash by way of taxation) and the hard place of few government growth initiatives. The substitution of state inactivity for private sector initiatives is as much a cause of investment uncertainty as are the destructive actions taken against private companies such as Yukos.
As for Gazprom, its increasing role as the state's holding vehicle in the energy sector means that it is displacing the military-industrial complex as Russia's main source of geopolitical leverage. In the future we can expect to see Gazprom making up a larger part of the trade delegations that travel with Putin and to see more and more announcements of intended cooperation between the energy giant and local energy companies, along the lines heard recently in Turkey and India. This is in addition to Gazprom's already important role as energy supplier to Europe, as likely partner for international energy majors in the development of a liquefied natural gas export business, and in the joint venture development of new oil projects in eastern Siberia to fill the proposed new export pipelines. Gazprom already binds Russia to the West, and assists in new relationships with countries like India, China and others.
Five years ago, Russia had foreign debts of $145 billion, or 77.4 percent of its GDP, and foreign exchange reserves of only $12.5 billion. Oil exports, along with gas exports, earned the country about $80 million per day. Today, Russia's foreign debt is about $105 billion, or only 19.4 percent of GDP, while foreign exchange reserves and the stabilization fund now total about $135 billion. Daily export earnings from oil and gas now top $260 million.
These numbers testify to the fact that Russia today is in a much stronger financial and political position. Putin is clearly adopting a tougher stance in his international dealings that risks some cooling, albeit temporary, of relations with the West. However, Russia already has strong energy relationships that no one will want to disrupt. As Gazprom adds new relationships in both the East and West, the government may feel less inclined to worry about portfolio investors and private businesses. Investors, for their part, hope that along with Yukos' main production asset at this Sunday's auction, the government may also acquire something of the investor-friendly attitude.
Christopher Weafer, chief strategist at Alfa Bank, contributed this comment to The St. Petersburg Times.
TITLE: IN BRIEF
TEXT: Industrial Output Falls
MOSCOW (Bloomberg) - Industrial production fell 1.4 percent in November from the previous month, led by declining output of oil, nonferrous metals and construction materials, when adjusted for working days.
It was the largest monthly decline since April.
Output increased 2.7 percent in November from the same month a year ago on a work-adjusted basis, almost two times slower than a 5.3 percent median estimate by four economists surveyed by Bloomberg.
Without the adjustment, November output declined 3.6 percent from October and was 6 percent higher from the same month a year ago, the State Statistics Service said Friday.
"The data confirm the under-performance of Russian industrial output in comparison" with the last year, London-based Moscow Narodny Bank said in a statement.
"The prospects for 2005 appear less sanguine and the signs are far from encouraging."
Difficulties for companies to get loans and the government's tax claims against the country's largest companies, such as oil producer Yukos and mobile operator VimpelCom, "have raised investor concerns" and are hurting the investment climate, the bank said.
Deutsche Sale Delay
ST. PETERSBURG (SPT) - Following Deutsche Telekom's sale Friday of a 15-percent stake in Mobile TeleSystems, the German company vowed not to sell its last 10 percent of the Russian telecom giant until Aug. 15, 2005, RBC reported Monday.
Although Telekom raised $1.73 billion by reducing its stake in MTS from 25 percent to 10 percent, it has promised A Sistema not to get rid of all its shares until later next year, Andrei Ryabinnikov, head of A Sistema's press service, told RosBusinessConsulting on Monday.
A Sistema cannot increase its stake in MTS since it already has a controlling stake in the operator.
However, the agreement between Deutsche Telekom and Sistema stipulates that the latter has priority over buying a stake in MTS.
Man U shares Rise
LONDON (Reuters) - Shares of Britain's Manchester United rose more than 4 percent on Monday after U.S. financier Malcolm Glazer told the world's richest soccer club he was planning an Pound800 million ($1.56 billion) takeover offer.
Glazer, who has had two previous offers for the club rebuffed, met United Chief Executive David Gill last week in Tampa, Florida, a source familiar with the situation said on Sunday.
The billionaire owner of the Tampa Bay Buccaneers American football team, said the new offer would consist of more cash and less debt than his previous proposal, the source said.
The board of United had previously said it would not back an offer that left the football club deeply in debt.
A spokesman for Manchester United declined to comment.
TITLE: Baiting the Bear
TEXT: Even a cursory look at history shows that the breakup of major empires has not usually been a peaceful, beneficent process. The Soviet Union is perhaps the single great exception to this rule - an empire which declared itself defunct and voluntarily disbanded - neither compelled by the external pressure of crushing military defeat nor devastated by internal revolution. In their haste to put an end to the Soviet nightmare, Russia's leaders may have neglected to secure the country's legitimate interests.
Recognizing that the Soviet Union could not win the Cold War, Mikhail Gorbachev saw an opportunity for radical reform within the existing political structures; yet these reforms - clumsy, unpopular, both too little and too late - simply hastened the implosion of the empire. In the ensuing chaos, the impetuous and brilliantly opportunistic Boris Yeltsin saw his chance to strike a crippling blow against his old enemies in the Communist Party. In view of their precarious political situations, both Gorbachev and especially Yeltsin desperately sought Western alliances. Given the imperative of smashing the Communist juggernaut before it could regroup, as well as their admirable wish to put an end to Soviet imperialism, both men showed an almost childlike trust in the good faith of the West.
Perhaps unfortunately, rather than negotiating guarantees for Russia's right to live peaceably within secure and defensible borders, they countenanced not just the abandonment of its imperial ambitions, but also the trampling of its very legitimate security concerns. Both men believed they had firm reassurances regarding the limits of NATO's military penetration into the Commonwealth of Independent States.
Yet perhaps the temptation for the West to take advantage of Russian weakness and passivity simply proved too great. Russia increasingly finds itself surrounded by a potentially hostile alliance. Certainly, in situations such as Serbia where there has been a sharp divergence between Russian and Western interests, NATO's repeated promises to take Russian interests into account have proved fraudulent.
Frequently described as "expansionist," current Russian foreign policy is in fact anything but; it is purely defensive, aimed at the preservation of at least a minimal sphere of influence within Russia's historical heartland. From a historical standpoint, this is eminently comprehensible. Russia has been repeatedly invaded and devastated by Western armies: Twice in the last century, the western half of the country was reduced to rubble, and each time, it struggled to reconstruct in the face of a hostile West. Indeed, since the Crimean War, the main thrust of Russian foreign policy has been to establish buffers against foreign incursions.
The Cold War was fought largely by proxy. Much like the unfortunate Guatemalans and Argentines who spent decades living in terror of U.S.-trained death squads, or the several million Southeast Asian peasants slaughtered in what must be counted a singular approach to the preservation of their freedom, East Europeans paid a terrible price for the Soviets' attempt to export their version of paradise.
In the end, the Soviet system was indeed bankrupt - but it was dismantled from within before it could come crashing down upon Western Europe. In this, the West has been incredibly lucky. Nevertheless, there remains an opportunity to snatch defeat from the jaws of victory.
Whereas Russia willingly countenanced the loss of countries that had been integrated into the Soviet Union by force, Ukraine is different. The Russian state was born in 13th-century Kiev, and the eastern part of Ukraine is ethnically, linguistically and culturally part of greater Russia. Furthermore, were Ukraine to join NATO, Russian borders would become indefensible - Russia's greatest nightmare. It is, of course, not sufficient for a country to have legitimate interests - they must be advanced with dexterity and skill. The appallingly mishandled Ukrainian elections represent a failure of Russian diplomacy - the choice between East and West need never have been posed in such stark terms. While there was gross political manipulation by both sides, the Russians lost the media war. The East European tail has wagged the European dog as the ex-satellites attempt to cripple their old enemy - understandable, given their wretched postwar histories, but distinctly unhelpful for building a stable world.
There now is little doubt that Western interests will emerge triumphant. Whether they take this as an opportunity to build bridges while respecting Russia's historic interests, or instead seek to establish a puppet state to contain Russia, will largely determine the future of Eurasia - and a threatened, cornered bear is a dangerous beast indeed.
Triumphant in the Cold War, some Western commentators have developed an irritating propensity toward self-congratulation. The totally illegal U.S. invasion of Iraq - based on forged evidence and brute force - demonstrates the painful reality that international relations remain based upon power; the era of imperium is not over - its justifications have simply been revised.
The best security remains the ability to inflict unacceptable pain on any potential aggressor. It is thus hardly surprising that Russia is rebuilding her nuclear deterrent, rushing to develop a new class of intercontinental ballistic missiles capable of penetrating missile defenses.
Fortunately, less devastating policy levers abound. Unlike its amateurish political diplomacy, Russian economic diplomacy has rung up a series of impressive successes. Unified Energy Systems is consolidating ownership of the energy industry throughout the CIS. Gazprom - sitting atop the world's largest gas reserves and now seeking to build a world-class oil business - is a key player in global energy, courted by East and West alike.
Russia is the world's second-largest arms exporter. Like the Europeans, it takes an increasingly jaundiced view of American unilateralism. Even in Ukraine, Russian oligarchic interests are likely to outbid outgoing Ukrainian President Leonid Kuchma's cronies in the privatization of state assets. The European Union is struggling to integrate its new members, and with the Turks already waiting in line, will be unable to welcome 50 million impoverished European peasants within our lifetime. President Vladimir Putin's irony was palpable when he recently invited them to do just that.
When Putin assumed the presidency, Russia was still recovering from the lost decade of the '90s and desperately needed time to rebuild. Deeply indebted, politically unstable and impoverished, Russia was pervaded by depression, insecurity and humiliation. Its transformation over the past five years has been little short of miraculous. For all the warts - corruption, poverty, pollution and demographic decline - Russia is an increasingly self-assured and prosperous place. It is absurd to imagine that a stronger and more self-confident Russia should continue to kowtow to the West.
The breaking point is within view, but there is time to step back from the brink. For Europe to have any positive influence upon local political developments, the dialogue must be transformed into one between equals. While well-intentioned Western economic advice was largely responsible for the catastrophic outcome of the '90s, the example of a friendly, prosperous and stable European Union could still prove of huge political benefit to the Westernizing elements within the Russian elite. The Western powers have grown accustomed to dealing with a weak and passive Russia. It is time they adjusted to the new realities.
Eric Kraus is chief strategist for Sovlink Securities, Moscow. He contributed this comment to The St. Petersburg Times.
TITLE: Market Forces, Not Administrative Persuasion, Lead to Prosperity
TEXT: Not long ago the heads of retail chains Lenta, O'Kei and Metro Cash & Carry were summoned by the City Hall's committee for economic development, industrial policy and trade for an educational discussion. The retailers were told that it is totally unnecessarily for them to buy so many goods of their goods from producers in Moscow to the detriment of St. Petersburg producers. They should be great patriots and accordingly change their relations with local producers.
The discussion was led by deputy head of the committee, Yury Rakov and the daily Kommersant cited several of his eloquent remarks. One basic principle was expressed thus: "It's very important for us that products from St. Petersburg enterprises are sold in your stores." In reply, the commercial director of Lenta, Alexander Maximov, said that his company does not give preference to either Moscow or St. Petersburg producers. Rakov, according to Kommersant, was quick to retort: "Well, that's no good." Clearly, to demonstrate the seriousness of the committee's intentions , Rakov threatened "to organize producers, create several cartels and force retailers to accept their conditions."
The committee told me that Kommersant was exaggerating what had gone on. But no one denied that the above quotes were correct. Committee chairman Vladimir Blank said that Rakov had spoken the words with "his heart." However, that the authorities had tried to impose a purchasing policy on the chains was confirmed by Blank: "the chains that exploit their own monopolies have organized very high entrance terms; unjustifiably high." He expressed the main demand on the chains in the following way: "the retailers' purchasing system should be transparent and understood by the producer. And today the system employed by many chains is not clearly understood."
I don't intend to discuss each chain separately, but the chains' way of operating, which has been described many times in the media, is quite clear, in my opinion. And the process demands are tough, the standard high. The business of a big chain is based not simply on a high turnover, but also on fast turnover. Customers should be able to purchase lots of products in a short time. Therefore, for instance, the chains also organize continuous deliveries. They have virtually no warehouses - everything is sold as it comes in.
This process demands, on the one hand, well-organized deliveries, and on the other - a careful selection of the range of goods. Only under those conditions can the chains support low prices for high-quality goods. And, judging by the rapid growth rate of our chains, they are conforming to the demands of this industry. If it has been shown that Moscow companies, delivering their goods 700 kilometers from the capital or the Moscow region to St. Petersburg, are able to observe the tight schedules of supply requirements, and St. Petersburg companies, based just around the corner, are not, then the local companies themselves are at fault.
In developed countries they have already come to terms with the demands of retail companies - they are accepted as objective and based on the research of the chains. Producers understand that the demands are unavoidable when there is a stable supply of goods and a high turnover. By meeting the chains' demands it is quite common for producers' businesses to improve.
The interference of the authorities in the complex operations of the chains is capable of harming their finely tuned operations. Everyone stands to lose if buying goods is done not for economic reasons but for patriotic ones: the quality of goods will lower, but the price rise. And St. Petersburg producers will not never need to learn how to work effectively. Who can win from all that?
In response to my request to explain City Hall's stance on this issue, Vice Governor Mikhail Oseevsky answered: "We never said that we want to minimize the input from certain producers, for instance, those from Moscow. The city government does not intend to do that."
Chains account for only 50 percent of the market. In St. Petersburg there are a great number of independent shops that producers are able to supply. It's clear, however, that the chains are more effective buyers, and that producers would really like to supply there, but they do not want to go to the bother of meeting the chains' demands. It's much simpler to talk to a bureaucrat who will summon the non-compliant retailer.
Such a careless policy from the economics committee may cost the city dearly. According to Blank, City Hall is negotiating with 10 large foreign retail chains who want to enter the St. Petersburg market. Foreigners who want to invest in Russia know that here it is not only the law that regulates, but also "understandings." And careless utterances by bureaucrats, that demand that the chains concern themselves not with their profitability and not even with their customers, but with inefficient local producers, can be assumed by the foreigners to be taken as the real rules of the game. Quite understandably, they may well decide not to play this game, and wait for better times.
Vladimir Gryaznevich is a political analyst with Expert Severo-Zapad magazine. His comment was first broadcast on Ekho Moskvy in St. Petersburg on Friday.
TITLE: Beastly Behavior
TEXT: It was a largely secret operation, its true intentions masked by pious rhetoric and bogus warnings of imminent danger to the American way of life. Having gained the dazed complicity of a somnolent Congress, U.S. President George W. Bush calmly signed a death warrant for thousands upon thousands of innocent victims: a native population whose land and resources were coveted by a small group of powerful elites seeking to augment their already vast dominance by any means necessary, including mass slaughter.
A flashback to March 2003, when Bush finally brought his long-simmering brew of aggressive war to the boil? Not at all - it happened earlier this month. This time, however, the victims were not the Iraqi people, but one of the last remaining symbols of pure freedom left in America itself: the nation's herd of wild horses, galloping unbridled on the people's common lands.
With an obscure provision smuggled without any hearings or public notice into the gargantuan budget bill - 3,000 pages of pork and chicanery approved, unread, by Bush's rubber-stamp Republicans and that wiggly bit of protoplasm known laughingly as the "Democratic opposition" - Bush stripped the nation's wild horses of long-standing legal protections against being sold off, slaughtered and shipped overseas for meat. The Bush plan, spearheaded by Montana Senator Conrad Burns - longtime bagman for Big Cattle interests - sets a production goal of up to 20,000 wild horse corpses in the coming year, The Associated Press reports.
Why must these magnificent beasts be massacred, after decades of bipartisan protection? If they could speak, no doubt they'd look at the state terrorists of the Bush Regime and say: "They hate us for our freedom." And certainly, anyone cramped within the narrow confines of a harsh, blinkered worldview would be offended, even unmanned, by the sight of such splendid exemplars of liberty. First brought to America by the Spanish conquistadors, these bold rebels broke free of their masters and have roamed wild and unfettered for centuries. Their very existence is a living reproach to crippled souls obsessed with conquest, control and domination. So they must be destroyed.
It's a nice conceit - but the reality of the situation will hardly bear such tragic grandeur and psychological angst. Like its mirror image, the Iraq atrocity, Bush's horse caper is just a grubby little piece of graft: His fat-cat pals want to get fatter, so they use the federal government as a front for looting the public treasury. Meanwhile - as with Iraq - Bush ladles out the BS to cover their tracks.
Here's how it works. The 50,000 remaining wild horses roam on federal land - land held in common by the American people. Big-time ranchers also use this land to graze millions of their privately owned cattle. Able to buy and sell politicians like so much prime stock, the wealthy ranchers have rigged a long-running sweetheart deal that gives them access to this common pasturage at bargain prices: less than one-tenth of the going market rate for private grazing land.
The result is an effective annual subsidy of more than $500 million to some of the richest men in America, The Philadelphia Inquirer reports. As always, your rootin', tootin' cowboy capitalists must be protected from the risks of the "free market" at every turn - even as they impose it, at gunpoint, on others.
But like all good Bushists, they want more. Why do they want more? Simply because it's there, and they want it. Yes, our leaders and elites are that witless. That's not to say they're stupid, of course. Given the manifold imperfections of our still-evolving brainpans, it's possible to be remarkably cunning in pursuing your basest desires while remaining oblivious to their pointlessness and brutality - and to their origin in the blind electrical firings of those primitive layers of the mind we all share with the rat, the pig and the chicken.
So the ranchers want the horses off public land so they can cram more cows in there and make more money through their sweetheart deals. The resource at issue here is grass, not oil, but the principle is the same as in Bush's witless, pig-layer adventure in Iraq: Me want, they got; kill them, give me.
And as in Iraq, Bush's policy is swaddled with lies and fearmongering. The ranchers say they must be given even more public subsidies, or else the sacred right of all Americans to churn cheap beef through their intestines twice a day might be lost - and that would mean the terrorists win, right? Meanwhile, Bush says it costs too much to let all the wild horses live out their natural lives. Yet the total cost of the federal horse programs - $50 million annually - is a fraction of ranchers' yearly gorging at the public trough. The tiniest increase in grazing fees could cover the programs' costs for decades. Bush also claims the horses are gobbling too much government grass; yet private cattle on federal lands outnumber wild horses by 50-1. Indeed, past government studies recommended reducing cattle numbers to save deteriorating rangeland. Needless to say, the ranchers' prime stock in Congress will never let that happen.
But although they may be witless, you can't say the Bushists don't have a sense of humor when committing their depredations. For example, even as they were consigning 20,000 wild horses to unnecessary slaughter last week, they also declared a new "National Day of the Horse" - a yearly celebration of the animal's "vital contribution" to American culture.
What yocks, eh? No doubt the dead horses will enjoy this great honor just as much as the 100,000 slaughtered Iraqis enjoy their "liberation."
For annotational references, see Opinion at www.sptimesrussia.com
TITLE: Iraq Car Bombing Kills 60, Wounds 120
PUBLISHER: The Associated Press
TEXT: NAJAF, Iraq - Car bombs tore through a Najaf funeral procession and Karbala's main bus station Sunday, killing at least 60 people and wounding more than 120 in the two Shiite holy cities. In Baghdad, gunmen launched a bold ambush, executing three election officials, in their campaign to disrupt next month's parliamentary ballot.
The deadly strikes highlighted the apparent ability of the insurgents to launch attacks almost at will, despite confident assessments by U.S. military commanders that they had regained the initiative after last month's campaign against militants in Fallujah.
In the Baghdad attack, dozens of guerrillas - unmasked and apparently unafraid to show their faces - ran rampant over Haifa Street, a main downtown thoroughfare. They dragged the three election workers from a car, lay them on the street in the middle of morning traffic and shot them point-blank.
The bombings in Najaf and Karbala, which Shiite officials suspected were coordinated, were the deadliest attacks since July. They were a bloody reminder that the Shiite heartland in the south - not just the Sunni regions of central and northern Iraq - is vulnerable to the mainly Sunni insurgents aiming to wreck the vote.
Shiites, who make up around 60 percent of Iraq's population, have been strong supporters of the election, which they expect will reverse the longtime domination of Iraq by the Sunni Arab minority. The insurgency is believed to include many Sunnis who have lost prestige and privilege since Saddam Hussein's fall.
The persistent insurgent violence has already raised questions over whether residents of central and northern Iraq will be able to vote. If attacks scare away voters in the south as well, it would further undermine the first national ballot since Saddam was ousted.
In a message passed on by lawyers who visited him in his cell last week, Saddam denounced the elections as an American plot.
Police and Iraqi National Guard troops on Monday set up checkpoints throughout Najaf, and roads leading to the city's holy Imam Ali shrine were blocked, apparently out of fear of repeat attacks.
Also Sunday, insurgents detonated two roadside bombs and a car bomb targeting U.S. forces in the volatile city of Mosul 225 miles northwest of Baghdad, in three separate attacks during a two-hour period. Three soldiers were wounded in one roadside bomb blast, while there were no casualties from the others, according to military spokesman Lt. Col. Paul Hastings.
An official with the leading Shiite political party, the Supreme Council for the Islamic Revolution, said the bombings in Karbala and Najaf Sunday were "no doubt" linked. "These operations aim at driving the Shiites away from the political process and toward acts of revenge to undermine the national unity," Jalal Eddin al-Sagheer said. "The whole issue has to do with elections."
Grand Ayatollah Mohammed Said al-Hakim, one of Najaf's top four Shiite clerics along with al-Sistani, denounced the bombings, saying they aimed to "create a disturbance in security and incite sectarian sedition" and that God will "avenge and compensate" the victims.
The Baghdad ambush was the latest attack to target Iraqi officials working to organize the elections.
TITLE: Sikh Protesters StormTheater
PUBLISHER: The Associated Press
TEXT: LONDON (AP) - Hundreds of Sikh demonstrators caused thousands of dollars worth of damage when they stormed a theatre in central England to protest a play depicting sexual abuse and murder in a Sikh temple, a spokeswoman for the theatre said Sunday.
Police arrested three men after the unrest Saturday at the Birmingham Repertory Theatre and later released them on bail pending further inquiries, a spokesman for West Midlands Police said. Three police officers suffered minor injuries.
Some 400 Sikh protesters tried to storm the venue to prevent a production of Behzti, by Sikh playwright Gurpreet Kaur Bhatti, which they claim mocks their religion. Local politicians and religious leaders in Birmingham have also expressed concern about the show.
Managers of the venue say the play is a work of fiction and makes no comment about Sikhism as a faith or its followers in general. The theatre also invited the Sikh community to write a statement expressing its views on the play, which was given to every member of the audience and read out before the performance, the theatre spokeswoman said, speaking on condition of anonymity.
TITLE: Sudan to Stop Darfur Attacks
PUBLISHER: The Associated Press
TEXT: KHARTOUM, Sudan - Sudan has pledged to halt military operations in Darfur, a United Nations spokeswoman said Sunday, but African Union officials said the government had kept up attacks on rebels in the region.
Union officials, in charge of monitoring a truce, said Khartoum had defied a Saturday ultimatum set by Union mediators, who had threatened to refer Sudan and the rebels to the U.N. Security Council if the two sides failed to meet the deadline.
Unknown fighters shot at an African Union helicopter in Darfur on Sunday, but the aircraft landed safely, said AU spokesman Assane Ba, in Abuja, Nigeria. He gave no further details about the helicopter or its occupants.
Two Darfur rebel movements in Abuja on Sunday also accused the Sudanese government and the pro-government Janjaweed militia of continued attacks on villages.
Charges and countercharges are common in the war in Darfur, a conflict that has defeated three rounds of peace talks and displaced nearly 2 million people since it began in February 2003.
The war was sparked when two non-Arab African rebel groups took up arms to fight for more power and resources from the Arab-dominated Khartoum government.
The government allegedly responded by backing the Janjaweed, an Arab militia, which is accused of targeting civilians in a campaign of murder, rape and arson. The United States accuses the Janjaweed of committing genocide.
Disease and hunger have killed 70,000 in Darfur since March.
TITLE: Empty Polls as Turkmen Ignore Vote
PUBLISHER: The Associated Press
TEXT: ASHGABAT, Turkmenistan - Polling stations were nearly empty Sunday in elections for Turkmenistan's rubber-stamp parliament, forcing officials to carry ballot boxes door-to-door in this nation ruled by a former Soviet Communist boss who has been declared president-for-life.
The 131 candidates contesting Parliament's 50 seats all represent the Central Asian country's only party, the Democratic Party led by President Saparmurat Niyazov. Niyazov reduced Parliament's role in 2003, stripping it of the right to make constitutional changes, and made the People's Council - a hand-picked assembly of more than 2,000 top officials and elders headed by himself - the country's highest legislative body. He uses the council to legitimize decisions.
At least 50 percent of voters had to take part to make the election valid. Election officials said 61.38 percent of eligible voters cast ballots during the first four hours.
However, polling stations in the capital of Ashgabat were almost empty. Election officials went door-to-door, carrying ballot boxes and voting slip, asking people to cast their vote.
Election officials said they were told to go door-to-door in case of low voter turnout. The government refused to invite foreign observers for Sunday's elections. Authorities have said the polls' fairness will be ensured by 200 observers from the state-controlled National Institute of Democracy and Human Rights.
All the candidates officially support Niyazov's policies, and based their campaigns on promoting the ideas in his book, "Rukhnama," which sets moral and spiritual guidelines for the country's citizens. It is held as a sacred text.
After casting his ballot, a resident of the capital said he had not followed the campaign of the candidate he voted for. The voter declined to give his name.
"I don't know who to vote for. Does it matter?" said another 70-year-old voter in Ashgabat. "What do they (deputies) do for people?"
From early morning, special agitators knocked on people's doors reminding them of the election. As an incentive, authorities prepared gifts for elderly and first-time voters that varied from Niyazov's "Rukhnama" book to towels and notebooks.
In 2005, Niyazov will mark 20 years at the helm of this gas-rich nation of 5 million people. He has been declared president-for-life and built a massive personality cult around himself.
TITLE: EU and Turkey Seal Deal on Entry Talks
PUBLISHER: The Associated Press
TEXT: BRUSSELS, Belgium - The European Union and Turkey reached a historic agreement Friday to begin talks next year aimed at bringing the populous Muslim nation into the EU after hammering out a compromise over Ankara's relationship with Cyprus.
Turkey accepted an offer from the 25 EU leaders during their two-day summit to begin talks on Oct. 3, 2005, launching a process that could take years and could transform the political and social landscape of both parties.
If the talks succeed, Turkey would become the largest EU member, with a population of 71 million - expected to grow as high as 85 million by 2020. But its per capita income is roughly one-third of the average of longtime EU member states, requiring far-reaching economic reforms.
Turkish membership would also add millions of citizens to the EU at a time when many Europeans are questioning whether their countries, which have Christian heritage, can absorb large numbers of Muslim immigrants.
Nevertheless, EU leaders hailed the agreement as a historic step, which would expand the borders of the EU from Ireland to Iran.
"If I think back on today, I believe we can say that we have been writing history today, and the agreement we reached today will acquire full significance in the years ahead," said Dutch Prime Minister Jan Peter Balkenende, whose country holds the EU presidency.
British Prime Minister Tony Blair said the decision to accept Turkish membership shows "that those who believe there is a fundamental clash of civilizations between Christians and Muslims are actually wrong; that they can work together; that we can cooperate together." But the deal nearly fell apart because of an EU requirement that Turkey initial an agreement Friday expanding its customs union with the EU to include Cyprus and nine other members that joined in May. The agreement would have to be signed by October.
Turkish Prime Minister Recep Tayyip Erdogan balked at the requirement, which EU diplomats said amounted to tacit recognition of the Greek Cypriot government.
Turkey invaded Cyprus in 1974 to block a coup by Greek Cypriots, and decades of diplomacy have failed to reunite the Mediterranean island. About 40,000 Turkish troops remain in northern Cyprus, which is controlled by Turkish Cypriots.
After hours of intensive negotiations, the EU agreed to accept a statement from Erdogan that he would sign the customs agreement before the talks start and that the move would not constitute recognition of Cyprus.
Nevertheless, the admission of Turkey to the EU is still strongly opposed in several EU countries, whose citizens fear an influx of culturally different migrants who would compete for jobs.
Supporters of Turkey's entry maintain that the country could be a bridge between Europe and the Middle East and stand as an example of a democratic state with Islamic traditions. Turkey, a longtime NATO member, has been legally secular since the collapse of the Ottoman Empire after World War I.
TITLE: Iranian Exhibition Unveils the Maps to Defend Persian Gulf
PUBLISHER: The Associated Press
TEXT: TEHRAN, Iran - Iran unveiled a collection of historical maps on Sunday in a bid to prove the legitimacy of calling its neighboring sea the Persian Gulf instead of the "Arabian Gulf" as it also is listed in the new world atlas by National Geographic.
Last month, Iran banned the sale of National Geographic Society publications to protest the "Arabian Gulf" inclusion.
The issue also has caused wide-spread protests by intellectuals, historians, and students across Iran, formerly Persia.
Identification of the Gulf region and various parts within it has long been a sensitive topic for Iran, which believes that there has been a pan-Arabist campaign since the 1950s - led by late Egyptian President Gamal Abdel Nasser and followed by deposed Iraqi leader Saddam Hussein - to call the sea the "Arabian Gulf."
Foreign Minister Kamal Kharrazi, who inaugurated the exhibition of ancient and historical maps Sunday, said the name of the Persian Gulf cannot be changed. The exhibition included a 1990 atlas released by National Geographic that identifies the sea as the Persian Gulf and the islands of Abu Musa and Greater and Lesser Tunbs as owned by Iran.
In its eighth edition atlas released in October, National Geographic used the term "Arabian Gulf" alongside "Persian Gulf" and referred to the islands as "occupied" by Iran and "claimed" by the United Arab Emirates.
In a Dec. 8 statement on its Web site, National Geographic said it was aware of the sensitivities of the issue and had held "constructive and informative" discussions with individuals and organizations representing Iranian and Persian interests.
Earlier, it had defended the atlas, saying it recognized the Persian Gulf as the primary name but used the "Arabian Gulf" alongside it to make is easier for users searching for that designation.
Iranian researchers and historians have launched a campaign to defend the Persian Gulf name, and youths are also collecting signatures through the Internet to support the campaign.
TITLE: IN BRIEF
TEXT: PM Resigned
BANJA LUKA, Bosnia-Herzegovina (AP) - The prime minister of the Bosnian Serb-run half of the country resigned Friday, a day after the U.S. government and Bosnia's top international administrator sanctioned Bosnian Serbs for failing to arrest and hand over war crimes suspects to the U.N. tribunal.
Dragan Mikerevic said he was "not prepared to accept the threats and ultimatums."
The Dayton peace agreement that ended the 1992-95 Bosnian war says all authorities must cooperate with the U.N. war crimes tribunal, based in The Hague, Netherlands.
The Bosnian Serbs have not arrested any of the war crimes suspects believed to be hiding in their territory, despite international pressure to do so. Police and the army are often criticized for protecting suspects.
4 Suspects Arrested
MADRID, Spain (AP) - Spanish police arrested four Moroccans on the Canary Island of Lanzarote on suspicion of being members of the Moroccan Islamic Combatant Group. One is believed to have had a possible role in the Madrid train bombings, the Interior Ministry said.
The four were suspected of setting up a logistical base on the island following recent arrests of members of the group in France and Belgium, the Interior Ministry said on Friday.
The Moroccan Islamic Combatant Group is part of the radical Salafia Jihadia movement and has close links to al-Qaida, the ministry said. It is believed to have carried out the 2003 attacks in Casablanca, Morocco, in which a dozen suicide bombers killed 32 people.
Battle of the Bulge
BASTOGNE, Belgium (AP) - World War II-era jeeps and trucks rumbled through this town Saturday in ceremonies marking the 60th anniversary of the deadliest battle in American history, the Battle of the Bulge.
Veterans from across the United States returned to find Bastogne covered in snow, just as it was that bitter cold December of 1944. The town of 14,000 took the brunt of the six-week battle that raged across the Ardennes hills of southern Belgium and Luxembourg.
The Battle of the Bulge was the war's largest land battle involving U.S. forces. It drew in more than a million troops - 600,000 Germans, 500,000 Americans and 55,000 Britons - who fought in bitter cold from Dec. 16, 1944, to Jan. 25, 1945.
Slayings in Hospital
PARIS (AP) - France's health minister on Sunday called for hospitals and police to work more closely after two hospital workers were found slain - one decapitated and the other with her throat slit - at a psychiatric facility.
The killings in the idyllic southwestern town of Pau shocked France, and hospitals across the country were to observe a moment of silence Monday to honor the two slain women.
Health Minister Philippe Douste-Blazy held an urgent meeting Sunday with health workers and Interior Ministry officials, the Health Ministry said.
Union leaders faulted a staff and funding shortage. They said security had been a problem for months, dozens of jobs were to be cut, and violence at the hospital was a common occurrence.
TITLE: Shaq Leads Heat to Eighth Straight Win
PUBLISHER: The Associated Press
TEXT: MIAMI - The Miami Heat have won eight games in a row, and Shaquille O'Neal says they're just getting started. The Heat overcame a nine-point halftime deficit and endured 15 lead changes to keep their streak going Sunday by beating Orlando 117-107.
"We're not blowing people out all the time," O'Neal said. "But we'll get to that."
Miami was down 103-102 with 5 minutes left before O'Neal took over, sparking a run of 13 points in a row.
On consecutive possessions, O'Neal hit a dunk, fed Eddie Jones for a 3-pointer that put Miami ahead to stay, then passed to Christian Laettner for a layup to make it 107-103. O'Neal's three-point play a minute later made it 110-103.
"At the end we just ran everything through Shaq," coach Stan Van Gundy said. "As the game goes on, the quick guys get tired and a little slower, but the big guys don't shrink."
In other NBA games Sunday, it was: Toronto 110, New Jersey 99; New York 94, Utah 93; Memphis 92, Los Angeles Clippers (news) 82; and Sacramento 107, New Orleans 71.
O'Neal finished with 27 points and five assists.
"I found my shooters a couple of times," O'Neal said. "They know if they get open, I'm going to hit them for the high-percentage shot."
Led by their new center, the Heat are on their longest winning streak since March 1998. Miami has the best record in the Eastern Conference by four games, and victories in the past four games over teams above .500.
"These are great wins," Van Gundy said. "Today was the best of all against a good team that was playing very well."
In the first meeting this season between the intrastate rivals, the Magic were eager to challenge Miami's supremacy atop the Southeast Division. Instead Orlando lost for the fourth time in five games and fell four games behind the Heat.
"They are supposedly the best team in the East, and we were right there," said Steve Francis, who led Orlando with 31 points.
The Magic's potent transition game fizzled at the end, and they made just two baskets in the final 5:16.
"That's one of the parts of the game where we have yet to grow," coach Johnny Davis said. "Down the stretch, the maturity and experience of a team show."
Cuttino Mobley had 22 points and Grant Hill 20 for the Magic, who lost despite shooting 51 percent. Miami shot 52 percent and trailed only 36-34 on the boards against the Magic, who lead the NBA in rebounds per game.
Jones went 8-for-10 for the Heat and scored 25 points. Dwyane Wade added 22 despite missing 14 of 20 shots.
The Magic sank their first five 3-point attempts, and in the first half they scored 63 points, 16 on fast breaks. But in the second half they managed just 44 points, six on fast breaks.
"We should have won this game," Hill said. "We have to figure out a way to steal some games, just like teams have been doing to us."
The Heat, 15-2 against Eastern Conference teams, have won five in a row against Orlando, including a sweep of their four-game series last season.
TITLE: Russia Triumphs Over the Czechs in the ROSNO Cup
PUBLISHER: The Associated Press
TEXT: MOSCOW - Alexander Popov scored the only goal as Russia beat the Czech Republic 1-0 and won the ROSNO Cup for the first time in four years on Sunday.
The Russians dominated the game and posed a threat to the Czech goal even when playing short-handed, but the home side squandered numerous scoring opportunities.
Popov, who plays for Omsk Avangard of the Russian League, finally scored from close range at 17:42 of the second period on a cross-ice pass from Alexander Perezhogin.
The match carried on at a frenetic pace as the Czechs looked to win on the physical side, with many heavy challenges testing Russia's patience.
Forward Anton Kurianov was close to scoring with 15 seconds left in the second period when he found himself in front of an empty goal, but only managed a low shot and goalie Jiri Trvaj stretched his arm to stop the puck.
Russia remained unbeaten at the ROSNO Cup and collected nine points from three games. The Czech Republic finished with three points after beating Sweden 4-3 in a penalty shootout on Thursday and losing to Finland 5-4 in overtime on Saturday.
Finland finished second in the four-nation tournament after beating Sweden 3-0 behind two goals from Tomy Salmelainen and one from Janne Niinimaa.
The event is the second leg of the Euro Hockey Tour. Finland won the opening event, the Karjala Cup, in November.
The third leg, the Sweden Hockey Games, is scheduled for February. The two best teams from the three events will then contest a two-leg playoff for the title in April.
TITLE: SPORTS WATCH
TEXT: FIFA Stops Female
MEXICO CITY (Reuters) - Mexican second division club Celaya has been refused permission by the world governing body FIFA to field woman striker Maribel Dominguez.
Celaya agreed terms last week with the 27-year-old, who played at the Athens Olympic Games, in a move which split Mexican football and sparked a national debate. On Sunday FIFA said it would not accept Dominguez playing in a men's professional league.
"The Executive Committee stressed once again that there must be a clear separation between men's and women's football," a FIFA statement said.
"This is laid down in league football and in international matches by the existence of gender-specific competitions, and the laws of the game and FIFA's regulations do not provide for any exceptions."
Dominguez, who is 1.60 metres and weighs 54 kgs, has played in the United States. Mexico does not have a women's professional league.
Totti Breaks Record
MILAN, Dec 19 (Reuters) - Two goals to Francesco Totti in AS Roma's 5-1 crushing of Parma on Sunday made him the club's all-time top scorer while third-placed Udinese beat Lazio 3-0 to close the gap on leading pair Juventus and AC Milan.
Juve's goalless draw at home to champions Milan on Saturday leaves them on 39 points with Milan four behind and Udinese now on 31 points.
A first-half free-kick from Sinisa Mihajlovic gave fourth-placed Inter Milan a 1-0 home win over Brescia and only their fourth victory of the season .
Totti's strikes for Roma took him to 108 Serie A goals, two more than Roberto Pruzzo's previous club record, on a day when he threatened in a newspaper interview to quit the club.
"All I can say is that it is like winning the title - an unforgettable moment. I hope I can continue and get many more goals," said Totti, who was mobbed by ball boys wearing his number 10 shirts after his first goal.
Phoenix Release Tabuse
TOKYO (Reuters) - Yuta Tabuse has been released by the Phoenix Suns less than two months after becoming the first Japanese player to appear in the NBA.
The diminutive point guard's fears were confirmed on Saturday when the Suns activated power forward Jackson Vroman, who has been out with a groin injury. Tabuse, who is just 1.73 meters (5ft 9in), scored seven points in his NBA debut against the Atlanta Hawks last month but has had little playing time since.
"I'm disappointed - but I have learned that I belong on this level," the 24-year-old Tabuse said on the Suns web site.