SOURCE: The St. Petersburg Times
DATE: Issue #1090 (56), Tuesday, July 26, 2005
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TITLE: Russians Unfazed By Egypt Bombs
AUTHOR: By Galina Stolyarova and Oksana Yablokova
PUBLISHER: Staff Writer
TEXT: A local family is reconsidering taking a holiday in the Egyptian resort of Sharm el Sheikh after terrorist bombs killed more than 60 people there on Saturday. But the Yakovlev family say they are only postponing a planned vacation in Egypt this August or September until a later date. 
“We have decided to postpone our visit until November, December or January,” Alexei Yakovlev, 20, a computer science student and the oldest son in the family, said on Monday. 
“The resort is destroyed now but the hospitality industry is crucial to the resort, so I am sure everything will be rebuilt by winter.”
Russian vacationers reacted calmly to terrorists attacks in the popular Red Sea resort, as Egyptian police hunting for bombers distributed photographs of some 50 foreigners, including five Pakistanis, who may be linked with attacks that killed at least 64 people. 
Two days after Egypt’s worst attack since 1981, officials are investigating the possibility that foreigners could be behind the three blasts which ripped through hotels and shopping areas of the Russian tourist Mecca, Reuters reported.
The president of the Russian Tourism Industry Union (RST) Sergei Shpilko said Monday that Russians have demonstrated a calm reaction to the events. 
“The ‘philosophical’ reaction of Russians has social and psychological reasons: the country has long been living in a state of economic and political turmoil and the citizens have developed an immunity to stressful events,” Shpilko said. 
Islamic militants, mostly home-grown, have launched attacks against Egypt’s $6 billion tourist industry, but the involvement of Pakistanis, if confirmed, would be unprecedented, Reuters reported.
The international tourism industry, which has suffered multi-million dollar losses over the past five years owing to frequent terrorist attacks, is now learning to come in terms with the new reality, Shpilko said. 
“Tourist flow used to take longer to recover after a major terrorist attack or disaster,” he said. “Now, things are getting back to much quicker because disasters and accidents, sadly, have become part of everyday life.”
Tatyana Demenyeva, spokeswoman for the Northwestern branch of the RST, said there are currently  between 3,000 and 4,000 Russians at Sharm el-Sheikh. “Over 900 Russians arrived at the resort on Saturday,” after the attacks, she added.
However, Yekaterina Mikhailova, Egypt sales manager for St. Petersburg’s Prima travel agency, one of the city’s largest tour operators, said the next local charter flight to Sharm el-Sheikh scheduled for Friday is at risk of cancellation.
“I have cancelled one request already — the client is going to Tunisia instead — and I have heard about further refusals from other travel agents,” Mikhailova said. “It is hard to say whether the flight will be cancelled or not. It depends on how many people decide against going there or carry on nonetheless.”
Tyurina said it was too early to predict the impact of the attacks on Egyptian tourism but suggested that prices for package tours might drop if travelers were to start avoiding the country. She said some Russians who had bought tours for the upcoming months contacted travel agencies Saturday afternoon and Sunday in the hope of exchanging their tickets for trips to Turkey or Tunisia. Only a few have flatly refused to go to Egypt, she said.
The numbers of Russian tourists visiting Sharm el-Sheikh is not likely to reduce in the long term, experts say.
“We are still receiving inquiries about the resort, which shows that people remain interested in this destination,” Mikhailova said. 
The Egyptian resorts of Sharm el-Sheikh and Hurghada, along with Turkey, are the most popular destinations for Russian vacationers throughout the year.
The latest round of disasters and terrorist attacks have left some Russian holidaymakers unmoved.
“Come to think of it, I can hardly name a place which I would be certain about [in terms of security]” said St. Petersburg self-employed businessman Dmitry Kuzmin, a frequent traveler. “Over the past five years, there were blasts in New York, Madrid and London as well as a horrendous flood in Prague and a disastrous tsunami in Thailand. Nobody can predict where the gun will go off next but as for Sharm el-Sheikh, I’d say that lightning doesn’t strike twice in one place.”
Russians were largely unaffected by the explosions because very few of them normally stay in hotels in Naama Bay, which was targeted by the bombers, Tyurina said. 
“Naama Bay has lost its attractiveness to Russian tourists because it is too crowded and noisy and its hotels are among the most expensive,” she said.
Usually, Russian tourists stay in hotels by smaller bays and come to Naama Bay in the evening to visit bars, discos and restaurants, Tyurina added.
Tourism is a key industry in Egypt’s economy. In 2004, the country welcomed 8 million visitors, who brought a precious $6 million to the Egyptian economy, according to RST statistics. Egypt was expecting the tourism flow to grow significantly, planning to receive 16 million tourists in 2010. Over 650,000 Egyptians are employed in the hospitality sector.
At least 64 people were killed by the Sharm el-Sheikh bombs, Minister of Tourism Ahmed el-Maghrabi said. Officials at Sharm el-Sheikh International Hospital on Saturday put the number of dead at 88.
Seven non-Egyptians, including two Italians, one Briton and a Czech, were also among the dead, Reuters reported.
South Sinai governor Mustafa Afifi told a news conference on Monday that a suicide bomber rammed a car packed with explosives into the Ghazala Garden hotel after running over two policemen. He said the body of the attacker had been found but he did not identify the attacker.
A second car, which exploded at Sharm’s old market, was to be used against another hotel, Reuters reported. It was unclear why the attacker left the car in the market or what triggered the explosion.
France on Monday discouraged French tourists from traveling to Sharm el-Sheikh and the United States has urged its citizens to avoid south Sinai and crowded tourist destinations in Cairo, according to Reuters.

TITLE: Former PM Returns to Face Criminal Probe
AUTHOR: By Nabi Abdullaev
PUBLISHER: Staff Writer
TEXT: MOSCOW — Returning from vacation Monday, former Prime Minister Mikhail Kasyanov accused the authorities of trying to discredit him through a criminal probe into his acquisition of a state-owned villa, and of attempting to frighten off potential opposition.
“I have no doubts that the systematic slanderous campaign aiming to discredit me, based on lies and misrepresenting the facts, is part of the authorities’ general plan to purge the political landscape,” Kasyanov said in a brief statement circulated by his consultancy firm a few hours after his return to Moscow from vacation abroad.
Earlier this month, prosecutors opened a criminal probe into alleged fraud and abuse of office by Kasyanov in the acquisition of a luxury state-owned villa in western Moscow.
Political observers have said the probe was likely a warning by the Kremlin to Kasyanov, a possible liberal presidential candidate in 2008, to stay away from politics.
Deputy Prosecutor General Vladimir Kolesnikov has denied political motives lie behind the probe, in which so far one mid-ranking official has been charged with causing financial damage to the state.
No charges have been brought against Kasyanov and investigators had not contacted him as of late Monday afternoon, his spokeswoman Tatyana Razbash said by telephone.
Alexander Khinshtein, a United Russia State Duma deputy and muckraking reporter who complained to prosecutors about the sale of the villa, claimed in Monday’s Moskovsky Komsomolets to have found evidence of Kasyanov having bought another expensive estate outside Moscow for 1,500 times less than the market price.
Boris Makarenko, an analyst with the Center for Political Technologies, said that Kasyanov was calling the Kremlin’s bluff over the probe.

TITLE: Matviyenko Widens City Hall’s Powers By Wielding Veto
AUTHOR: By Vladimir Kovalev
PUBLISHER: Staff Writer
TEXT: Governor Valentina Matviyenko vetoed 18 of 52 laws Friday submitted by the Legislative Assembly shortly after lawmakers went on vacation this month, approving mainly new legislation that widens the plenary powers of her own office, media reported last week.
One of the key laws signed by the governor was a set of amendments to the City Charter Court that limits lawmakers’ ability to publish new draft laws, giving more power to the governor. At the same time Governor Matviyenko vetoed a number of laws aimed at increasing social protections, such as an amendment aimed at increasing pensioners’ nominal official average spending index which is used to calculate other figures.
“[City Hall] is not able to finance social obligations, which have not been approved [by the city government] and are groundless from an economical point of view. All draft laws of this kind should be offered [to the Legislative Assembly for approval] by City Hall,” said Anna Mityanina, head of the City Hall legislation committee was quoted as saying by Kommersant Daily on Saturday. 
Matviyenko also sent back to the Legislative Assembly unsigned amendments to the municipal election law to ban the recent practice of advanced voting, which was pushed forward by City Hall and resulted in numerous violations registered by opposition candidates. The law would have affected the additional municipal elections in 14 districts of St. Petersburg, including in the satellite towns of Sestroretsk and Zelenogorsk, scheduled to take place in October. 
By not signing the amendments to the election law Matviyenko has turned the situation in City Hall’s favor, which will be able to run the elections according to the old scheme with the advanced voting, opponents of City Hall said. 
“There are two sides in this question. The elections in the rest of the districts would have to take place according to the rules that have been implemented in relation to elections in other municipalities this year. 
This endless story with the municipal elections should be finally finished and if Matviyenko means this by not signing this law, it’s fine,” said Vladimir Yeryomenko, the Legislative Assembly lawmaker of the United Russia faction, in a telephone interview on Monday. 
“But if she aims to keep the same rules in the future this is wrong. Advanced voting is very comfortable for the organizers of the elections in order to provide a reasonable turnout, but it doesn’t help democratic voting in any way and even otherwise. I know this according to an experience in my own district, where the advanced voting disturbed the whole picture of the final results,” Yeryomenko said. 
The local branch of the Yabloko party, strong opponents of City Hall, believes Governor Matviyenko aims to stop the process of distribution of power from the city government to the municipalities. 
“This position was formed [by City Hall] quite a while ago. There are numerous examples of how deputies from Yabloko, that won on election day, have not become deputies because City Hall fixed it using advanced voting by the direct buying of votes,” said Maxim Reznik, head of the local branch of Yabloko in a telephone interview on Monday. 
“This was the practice of the administration of [former governor] Vladimir Yakovlev and Matviyenko does the same by stopping re-division of power between City Hall and municipalities. It’s just comfortable for her to live this way, with all the power concentrated in her own hands,” Reznik said. 
In the last parliamentary session (2004-2005) lawmakers passed 160 new laws in total, 89 of which were initiated by deputies, 54 by the governor and 17 by municipalities, Vadim Tyulpanov, the Legislative Assembly speaker, said at a briefing this month. Lawmakers see the passing of  St. Petersburg’s general development plan as well as laws that softened the consequences of federal reforms to replace privileges for pensioners with cash payments as their major legislative accomplishments of the session.
Governor Matviyenko has signed 80 laws and has returned to the Legislative Assembly 41 laws. Twenty-five of them have been amended and passed. Legislators voted in five laws over the governor’s veto. 
The Legislative Assembly returns for work on Sept. 1.

TITLE: Spammer Beaten To Death
AUTHOR: By Carl Schreck
PUBLISHER: Staff Writer
TEXT: MOSCOW — The director of an English language center and one of the country’s most notorious spammers was found beaten to death in his apartment in central Moscow, police said Monday.
Vardan Kushnir, a 35-year-old Russian national who ran the American Language Center, was found at about 12:50 a.m. Sunday in his apartment at 20 Sadovo-Karetnaya Ulitsa, between the Mayakovskaya and Tsvetnoi Bulvar metro stations on the Garden Ring Road, city police spokesman Sergei Prudnikov said.
Kushnir had died about 35 minutes earlier of severe head injuries from an apparent beating, Prudnikov said. It was unclear who discovered the body.
City Prosecutor’s Office spokes-man Sergei Marchenko said the killer or killers had apparently rifled through Kushnir’s possessions, leaving the apartment in disarray.
He and Prudnikov refused to comment on a possible motive for the slaying, citing an ongoing investigation.
A district prosecutor, Pyotr Titov, expressed hope that the case would be solved quickly.
“Right now we need to thoroughly inspect the crime scene, gather the clues and identify possible suspects who could have committed the crime,” Titov said on NTV television. “But currently no one has been detained.”
NTV said investigators will examine video footage captured by a security camera pointed at the courtyard of the building where Kushnir lived.
Moskovsky Komsomolets reported on its web site that Kushnir had been struck at least 10 times on the head with a blunt object. The newspaper said, without citing any sources, that a laptop computer, a digital camera, a regular camera, gold and cash had been stolen from the three-room apartment.
A woman who answered the telephone at the American Language Center declined to comment about the death.
Andrei Kashutin, the managing director of IT Dvizhenia, an industry association of nearly 7,000 IT students and young professionals, said Kushnir and his company were the most well-known spammers in Russia, sending millions of unsolicited e-mail messages offering English classes at the American Language Center.
“Anybody who regularly uses e-mail has come across their spam,” Kashutin said.
He added, however, that it was highly unlikely that an angry e-mail user would actually kill him, “especially if it happened in his own apartment.”
Several former American Language Center employees concurred.
“He had other business disputes and might have owed someone money. He had a lot of enemies,” said one former employee who asked not to be identified because she did not want her name to appear in an article about the apparent murder of her former boss.
In July 2003, then-Deputy Communications Minister Andrei Korotkov, tired of a barrage of American Language Center e-mails, started a campaign to crack down on the spam. 
Korotkov, who oversaw the government’s Electronic Russia initiative, replied to an e-mail with a request to be taken off the center’s list. Instead he received a flurry of spam messages from the center and decided to flood the center with unsolicited phone calls.

TITLE: City Deputy’s Papers Stolen
PUBLISHER: The St. Petersburg Times
TEXT: The home of the leader of the Democratic faction in the city’s Legislative Assembly was burglarized on Sunday night, Interfax reported.
The thieves broke into Andrei Chernykh’s apartment on Grazhdansky Prospekt through the balcony door on the third floor, taking a notebook containing valuable information, documents relating to his political work, his Assembly member identification document, two air pistols, two hunting knives, three suits, ski equipment and about $1,000 in cash.
Chernykh is directly linking the crime with his political activities. 
“The Democratic faction, which I chair, remains the only opposition faction in the Legislative Assembly and the only political force in the parliament daring to criticize the city authorities,” the politician was quoted by Interfax as saying.
After a brief police investigation, a criminal case was opened following the burglary.

TITLE: IN BRIEF
TEXT: Anti-Terror Funds Up
MOSCOW — The government will earmark $125 million to fight terrorism next year, a more than five-fold increase from the amount spent in 2005, Interfax reported Monday.
“This is the biggest increase among all federal programs that are continuing from 2005 to 2006,” an unidentified Federal Security Service official was quoted as saying.
The Federal Security Service is the designated recipient of the program’s money, Interfax said. (SPT)

FBI Probe in Georgia
TBILISI, Georgia  (AP) — FBI agents on Monday hauled away boxes from the home of a man who has confessed to throwing a grenade at U.S. President George W. Bush at a rally in Georgia’s capital in May. 
Investigators have erected a tent outside Vladimir Arutyunian’s home, on the outskirts of Tbilisi, and appeared to be using special equipment to examine the evidence, according to footage shown by Georgian Rustavi-2 television. 
No one was harmed in the May grenade incident, but Arutyunian has been charged with killing a police officer in a shootout during his arrest last week. 
FBI and Georgian agents were questioning Arutyunian’s mother, Angela. She said she had been instructed not to discuss details, but that she planned to visit her son on Tuesday. “I don’t know if they will let me in to see him or not,” she told reporters. 

Welder Killed in Blast
VLADIVOSTOK  (AP) — A welder was killed and another injured when a torch sparked an explosion in a shipping container filled with polyester granules at a Far East port Monday, a prosecutor’s official said. 
Denis Babikov, prosecutor for the city of Nakhodka, said the blast occurred at around 2 a.m. Moscow time in the port of Vostochnyi as the two men were welding a piece of metal. The second welder was hospitalized with concussion and leg injuries, he said. 
Babikov said the container, being shipped from South Korea to Kazakhstan, had no warning labels on it indicating its contents were flammable. Prosecutors have opened a criminal investigation, he said.

2 Dead in Avalanche 
MOSCOW  (AP) — Two Belarussian climbers were killed and two were presumed dead after an avalanche in southern Russia, emergency officials said Monday. 
Viktor Beltsov, a spokesman for the Emergency Situations Ministry, said nine climbers were on the second day of their ascent of 4,500-meter Mount Belukha near the border with Kazakhstan when the avalanche hit on Friday.

TITLE: Three Judges Convicted of Fraud
AUTHOR: By Oksana Yablokova
PUBLISHER: Staff Writer
TEXT: MOSCOW — The Supreme Court on Monday convicted three federal judges of fraud for illegally expropriating dozens of Moscow apartments worth some $5 million in the late 1990s.
The court also found Judges Vasily Savelyuk, Nina Ivchenko and Nina Mishina guilty of being members of a criminal organization and of abusing their posts by stealing the apartments of owners who died but had left no will or legal instructions for transferring the property to their relatives. 
Supreme Court Judge Nikolai Lavrov said in televised remarks that the judges carried out the scheme from 1996 to 1998.
Lavrov was to resume reading his verdict Tuesday, a court official said by telephone.
Prosecutors are seeking a 15-year prison sentence for Ivchenko, the former deputy chief judge of the Butyrsky District Court; 12 1/2 years for Savelyuk, a former judge at the same court; and 12 years for Mishina, who was a judge at the Babushkinsky District Court, Interfax reported.
Ivchenko has admitted her guilt on all three charges, while Savelyuk and Mishina have maintained their innocence, Interfax reported.
Prosecutors said the judges had illegally authorized the transfer of at least 110 apartments to other members of the criminal gang.
Investigators found that the three judges teamed with Alexei Yevstafyev, who is now serving a prison sentence of 12 years for fraud, in 1996 or 1997 to get hold of the apartments, Interfax said. 
Yevstafyev is believed to have instructed other members of the gang to collect information about apartments that were vacant after the death of owners.
In violation of the law, the judges then made rulings on who got the apartments without informing city authorities about their decisions, Interfax said.
It is unclear what happened to all the apartments, but prices for Moscow apartments have steadily grown in recent years.
Prosecutor General Vladimir Ustinov personally ordered criminal proceedings to be opened against the three judges in August 2000.
Russian courts have often been accused of corruption and of being dependent on the authorities in making their rulings.
A study released last week by Indem, an anti-corruption think-tank, found that judges make up to $209 million per year in bribes to make favorable rulings.
However, cases of federal judges being convicted and serving lengthy prison terms are very rare.

TITLE: Dockers Go on Strike For Better Contracts
PUBLISHER: Combined Reports
TEXT: Dock workers at St. Petersburg’s port began a limited three-day strike Monday to demand better working conditions, accusing port operators of pressuring them to accept less favorable contracts, news reports said. 
The workers will strike for one hour a day and refuse to work overtime, said Alexander Moiseyenko, head of the St. Petersburg dock workers union, according the Interfax news agency. After three days, the workers may decide on a full-scale strike.
The strike is meant to slow the loading and unloading of ships in the port, a major transport hub in northwest Russia that processed 14.6 million metric tons (16 million tons) in 2003, he said. 
The three port operators in Russia’s second largest city are offering new collective contracts that remove indexation of pay and weaken job security, Interfax reported a representative of the workers as saying.
Union leaders were seeking dialogue with employers, but the port administration told the trade union to leave its offices and switched off their phones, said Moiseyenko. 
The union is threatening full-scale industrial action if management does not respond to their complaints. Union and port officials were not available for comment. 
Strikes are rare in Russia, a legacy of Soviet times when unions were closely affiliated with management.
(AP, SPT)

TITLE: IN BRIEF
TEXT: Chinese Tourists Come
ST. PETERSBURG (SPT) — China will allow organized tourists to visit Russia, “with no visa requirement” from August 25, online Chinese news service Xinhuanet reported Monday. 
After three years of negotiation, China and Russia signed a tourism memorandum, which allows more groups of Chinese tourists to visit the nation. More than 600 Chinese travel agencies are allowed to organize group tours to Russia, stae-controlled Xinhuanet reported.

New Warhol Show
ST. PETERSBURG (SPT) — The works of U.S. pop artist Andy Warhol are set to be displayed in St. Petersburg later this year, the Associated Press reported on Sunday.
More than 300 of Warhol’s works — ranging from his celebrity portraits and soup-can still lifes to his films and sculptures — will tour Russian cities under the title “Andy Warhol: The Artist of Modern Life.”
The U.S. Department of State sponsored a 40-piece exhibition of the artist’s works five years ago in the State Hermitage Museum. 

Customs’ Sting Success
ST. PETERSBURG (SPT) —  The city’s customs officials say they have prevented the smuggling of important classified information, Interfax reported.
Citing the Northwestern customs board’s press office, the agency said the espionage was prevented by the board’s internal security division, which established a sting operation engaged in bribing officials to hand over classified information on the foreign trade of Russian companies and the statistical system of Russian tax authorities.
The city’s prosecutor’s office has opened a criminal case. 

Heart Foundation 
ST. PETERSBURG (SPT) —  A new medical science development foundation in the field of heart and circulatory diseases will be created in St. Petersburg, Interfax reported.
The foundation, named after renowned Russian heart surgeon Vladimir Almazov, is scheduled to be launched in October.
“The main purpose of the new organization is unification of intellectual, financial and managerial efforts of Russian and foreign professionals to boost development of medical science in the field of heart and circulatory diseases,” said Olga Ostrovskaya, press secretary of the St. Petersburg Institute of Cardiology.
The foundation’s activities will be supervised by a Board of Trustees featuring prominent scientists, businessmen, cultural luminaries and respected media professionals.

Renewal Plan On Track
ST. PETERSBURG (SPT) — A complex program to revive and develop the Oranienbaum Estate is due to be completed in two months’ time, Interfax reported.
Quoting Mikhail Shvydkoi, head of the Federal Agency on Culture and Cinematography, the agency said the revival project has been provided with full-scale funding until the end of this year.
“We are looking into possibilities to get additional funding for the next year through the Ministry of Economic Development,” Shvydkoi was quoted as saying. “The restoration works are now going ahead of schedule.”

Park Concept Proposed
ST. PETERSBURG (SPT) — A new development concept for the Kirov recreation park on the Petrograd side will be presented in September to the city government, Interfax reported.
“The core of the concept is to preserve the existing park as a social park with a free entrance on working days and discounted entrance on weekends,” the agency quoted park director Pavel Seleznyov as saying. Popular open air shows and festivities will continue being part of the park’s agenda but its eight monuments and galleries, including the Yelagin Palace, are in poor condition and require massive restoration.

TITLE: Church: Russia Will Not Survive a New Revolution
AUTHOR: By Stephen Boykewich
PUBLISHER: Staff Writer
TEXT: In a sign that the Russian Orthodox Church wants to play a role in national politics, its leading spokesman warned a gathering of pro-Kremlin youth leaders that an Orange Revolution in Russia would bring only bloody chaos.
“Russia has already lived through one colored revolution — a red one,” Vsevolod Chaplin said on Saturday in a speech to leaders of the Nashi youth movement at their summer camp on Lake Seliger, northwest of Moscow, Interfax reported.
“Russia will not survive a new revolution,” said Chaplin, who is the church’s deputy head for external relations.
The possibility of large-scale street protests like those that shook Ukraine last year was a frequent topic at the two-week camp, which was to end Monday. Kremlin-connected spin doctor Gleb Pavlovsky warned during a visit to the camp that “numerous groups are preparing large demonstrations not just for 2008, but as soon as this fall.”
Nashi, or Us, is seen by many as a Kremlin-orchestrated effort to build a bulwark against a potential popular uprising in the run-up to the 2008 presidential election. The group gained attention shortly after its founding in April for its aggressively patriotic rhetoric and the staging in May of a rally in Moscow attended by 50,000 people.
According to Nashi head Vasily Yakemenko, the movement currently has more than 150,000 members nationwide.
Opposition youth movements such as Ukraine’s Pora and Serbia’s Otpor have been instrumental in unseating governments in their respective countries. Representatives from both groups have recently met with their Russian counterparts, fueling Kremlin fears of future unrest.
Chaplin’s speech was notable as an explicitly political address by a church representative — still a rarity in spite of the church’s increasing presence in the secular sphere. Patriarch Alexy II regularly meets with President Vladimir Putin, and Orthodox clergy are often prominent guests at political events.
Chaplin used vivid terms in raising the specter of Russia’s disintegration, as Putin himself has.
“If the country breaks apart, it will become not a mass of little Switzerlands, but one big Yugoslavia torn by bloody chaos, which no foreign peacekeepers will be able to control,” Chaplin said. “The defense of the country’s unity, its independence and its spiritual freedom must be the business of all society and every one of us.”
Lawrence Uzzell, head of International Religious Freedom Watch and a frequent commentator on religious affairs in the former Soviet Union, said Chaplin’s statements were “a perfectly logical extension of the Moscow Patriarchate’s servile relationship to the state.”
“The Moscow Patriarchate has a long history of being Russian first and Orthodox second,” Uzzell said. “Unfortunately, when there is a conflict between the interests of the Russian people and the interests of the Russian state, the Moscow Patriarchate usually comes down on the side of the state.”
Chaplin’s speech came after a round table last month on “The Orthodox Question and the Threat of an Orange Revolution in Russia,” which explicitly addressed ways to use religious tradition to combat revolutionary tendencies. Chaplin, State Duma Deputy Alexander Makarov and lay activists discussed strategies such as school courses in Orthodox culture, greater church presence on national television channels and concerts by Orthodox rock musicians.
Ukraine’s Orange Revolution has been a sore point for the Russian Orthodox Church for several reasons.
“Members of the Moscow Patriarchate in Ukraine acted as agents of secular Russian political interests” during the 2004 elections, Uzzell said. “There were many instances of members of the Moscow Patriarchate in Ukraine using their influence with their parishioners to get them to vote” for Viktor Yanukovych, the candidate favored by the Kremlin.
Political tensions between Russia and Ukraine in the wake of the Orange Revolution have also fueled Ukrainian desires for a church that is fully independent of Moscow. Currently, Ukraine’s main Orthodox church comes under the authority of the Moscow Patriarchate.
“The Moscow Patriarchate is the last surviving Soviet institution both in terms of its statist mentality and its imperialist mentality,” Uzzell said. “In a sense it is an empire-restoring institution that is used by the Russian state as a vehicle for political interference in the affairs of countries like Ukraine.”
Nashi press secretary Ivan Mostovich insisted that there was no special relationship between the Kremlin-connected movement and the Russian Orthodox Church. He acknowledged that Nashi members had been helping renovate the Nilova Pustyn monastery near the Lake Seliger camp over the past two weeks, but said that their cooperation was based on common worldly goals, rather than spiritual ones.
“We have a working relationship with the Russian Orthodox Church as we do with every structure that is working for the good of our country,” Mostovich said. “That relates both to Orthodox believers and to Muslims and to every other group that plays a major role in the life of our country.”
Mostovich pointed out that on Friday, Chaplin shared a platform with Sheikh Mohammad Karachai, deputy chairman of the Russian Society of Muftis, one of the country’s main organizations of Muslim clerics.
Karachai, like Chaplin, sounded a note of national unity, telling his audience, “Unity must be revived and preserved,” Nashi’s web site reported.
He also praised the Nashi leaders for having found an alternative to the more indulgent aspects of contemporary youth culture.
“Nashi has shown that it is possible to organize youth who are not interested in alcohol and drugs, but are oriented toward education and learning,” Karachai said. He urged those gathered to “remain high-principled people who care about spiritual values rather than material goods.”

TITLE: Latvian Pride Takes a Dent
PUBLISHER: The St. Petersburg Times
TEXT: Police arrested six protesters Saturday after they shouted insults at people taking part in Latvia’s first gay pride march, BBC News reported. Hundreds of protesters blocked the city’s narrow streets, outnumbering the marchers. 
Police altered the march route to form a chain around the parade participants to protect them. The march sparked outrage in Latvia and only went ahead after a court overturned a council ban on the event.
Prime Minister Aigars Kalvitis opposed the event, saying Riga should “not promote things like that.” 
“For sexual minorities to parade in the very heart of Riga, next to the Doma church, is unacceptable,” he told LNT television last Wednesday. 
One of those who took part in Saturday’s march, 61-year-old Lars-Peter Sjouberg, from Sweden, said he had been shocked by the offensive remarks made by protesters. “Protesters here were really aggressive,” Sjouberg told the BBC. “But it won’t stop me from helping my Latvian friends fight for their rights.”

TITLE: New Harry Potter Book Hits RuNet
AUTHOR: By Anatoly Medetsky
PUBLISHER: Staff Writer
TEXT: MOSCOW — The official Russian translation of “Harry Potter and the Half-Blood Prince,” the latest installment in the popular series, will not be released until December, but impatient fans needed only to go online to start reading the book two days after its release in the West last week.
Given that many of the series’ readers are teenagers, who are also among the most active Internet users, Rosman Publishing House risks losing more than half of its potential profit, a copyright expert said Friday.
The sixth installment in the popular series about the young wizard who fights the evil Lord Voldemort hit bookstores in the English-speaking world on July 16, selling a record 6.9 million copies on the first day alone.
But Russian readers were able to devour an unauthorized translation of the 672-page book’s first chapter for free on certain web sites as early as July 18. Three more chapters followed the next day on one of the sites, http://book6.potterfilmru.net.
Rosman cannot force the translations to go offline because under Russian law they do not constitute a violation of the publisher’s rights, said Tatyana Uspenskaya, commercial director at Rosman. 
Rosman is to hold the rights only for printing the book, not publishing it online, she said.
Rosman is now formalizing the purchase of publishing rights and selecting translators for the book ahead of its scheduled release on Dec. 3, said Natalia Dolgova, a spokeswoman for Rosman.
Responsibility for challenging unauthorized translations lies with Baker & McKenzie, the law firm that represents author J.K. Rowling and Warner Bros., which controls the film rights to the series, Rosman said.
Baker & McKenzie successfully asked Internet providers to close several sites that published illicit translations of the fifth book in the series, “Harry Potter and the Order of the Phoenix,” before it officially came out in Russian in February 2004, the publisher said.

TITLE: Train Explosion Kills Woman, Injures Policeman in Dagestan
PUBLISHER: The Associated Press
TEXT: MAKHACHKALA — A bomb exploded beneath a train in Dagestan on Sunday, killing one person and injuring four others, police said. 
The explosive device went off around 5:30 a.m. under the first car of the train as it headed to the regional capital, Makhachkala, from the northwestern town of Khasavyurt, said Akhmed Magomayev, deputy chief of the region’s railroad police department. The train car derailed, and a crater was left in the track bed. 
A woman, who was among five people injured, died on the way to a hospital, Magomayev said. One of the injured was a transport policeman on the train, he said. 
State-run Rossia television showed footage of the damaged train car, its interior a jumble of battered wooden benches and torn ceiling panels. 
Authorities were trying to determine the strength of the bomb, which was apparently set off by remote control about 10 kilometers from Khasavyurt, Magomayev said. 
Dagestan, which borders Chechnya, has seen increasing violence believed to be connected with insurgents and criminal gangs. The number of terrorist attacks in the region has more than doubled this year to 70, a human rights group said last week. 
President Vladimir Putin visited Dagestan a week ago, a sign of Kremlin concern over increasing violence in regions surrounding Chechnya. 
Also Sunday, police said two powerful explosive devices were found in a car in the southern city of Kaspiisk. Dagestani Interior Ministry spokesman Angela Martirosova said police found the car Saturday evening and engineers were working to defuse the devices, which consisted of artillery shells strapped together with grenades. 
She said authorities also found in the car automatic rifles, bullet cartridges, plastic explosives and other materials.

TITLE: Chechens Flee Over Border
PUBLISHER: The Associated Press
TEXT: NALCHIK — Dozens of residents of a Chechen village have fled to Dagestan for the second time in two months, officials said Friday, in what human rights activists said was an attempt to escape abuses by local security forces. 
Thirty Borozdinovskaya residents fled their homes and crossed into Dagestan on Thursday, settling in the town of Kizlyar, the Chechen president’s press service said. 
But Vyacheslav Burov, Kizlyar’s top official, said that up to 80 residents fled to his town on Thursday and still more came Friday, their makeshift tent camp now numbering more than 100 people. 
Hundreds of Borozdinovskaya residents — virtually the entire village — spent two weeks in the Kizlyar camp in June after security forces conducted a brutal raid in their village, killing one elderly villager and leaving 11 others missing and feared dead. 
The June 4 raid pitted ethnic Chechens against ethnic Dagestanis, marking the first serious conflict between the two groups. Villagers blamed the raid on members of the Vostok battalion, comprised mostly of ethnic Chechens but subordinate to the federal military.
Residents returned in late June only after President Vladimir Putin’s top envoy to the Southern Federal District, Dmitry Kozak, intervened and Chechen Deputy Prime Minister Ramzan Kadyrov offered safety guarantees and compensation. 
Saigid Murtuzaliev, a Dagestani lawmaker who helped mediate the crisis, speculated that the slow provision of compensation prompted the villagers to flee to Dagestan for the second time. 
Human rights groups, however, said Borozdinovskaya residents were driven by fear for their safety. 
“In all of Chechnya, I haven’t seen a place where people would be as scared,” said Svetlana Gannushkina, an activist with the human rights group Memorial.

TITLE: Staff Strike As Printing Firm Faces Bankruptcy
AUTHOR: By Vladimir Kovalev
PUBLISHER: Staff Writer
TEXT: A business conÿict between former and current management threatens to spell the end for one the city’s oldest printing houses, Svetoch. In an extreme measure, the plant’s employees plan to launch a public protest on Tuesday.
In a letter to the local media the staff of Svetoch said they intend to express their concerns over the future of the printing house, which they rate as critical due to management disputes.
Over 400 employees are afraid they will end up on the street while the dispute — which started after the previous director of the company left of¸ce in fall of last year — drags on and steadily bankrupts the company, protest initiators said.
“The [former] general director of the plant, Alla Kazakova, disappeared in October, 2004. In December last year we found out that she had signed an agreement to hand over the building of the printing house, at 10 Bolshaya Pushkarskaya, to Cube real estate company,” Mikhail Shchepetkov, a representative of the current management at Svetoch, said Friday in a telephone interview.
The building was handed over to the Cube with an aim to be sold for about $1 million, he said. “So far, we haven’t seen any of that money,” Shchepetkov said.
In 2004, Svetoch announced plans to relocate production to a territory near the Petergovskoye Shosse in order to expand the business. Moving staff and equipment to the new site, the printing firm aimed to turn the old property into a recreational center.
The printing house had relocated 35 percent of the equipment before the move was stopped by current management, because the city’s Arbitration Court ordered an injunction against the company at the request of Kazakova, protest initiators said.
The management wrangle has led to dwindling production, and a freeze on the ability of Svetoch to take out credit.
The next court hearing is scheduled for August 4.
At Tuesday’s meeting, Svetoch employees plan to express worries over the drop in production, delays in salary payments, as well as the inevitable ¸ring of staff, current management of the plant said.
When contacted Friday, the former head of Svetoch, Alla Kazakova said the only thing to blame in this case was bad management. Kazakova, who now heads Premium, another St. Petersburg-based printing house, said she has no interest in being involved in the situation.
“I didn’t disappear from the printing house, as the current management try to portray. I was delivered to a hospital with asthma and heart complications and spent four months there. While away [from Svetoch] my position was taken over,” Kazakova said in a telephone interview.
“I have no intention in getting involved in the conÿict. I damaged my health because of it,” she said. “There’s not much the workers can do when the current management of the plant can’t do business.
“I have a lot of requests from employees of that printing house asking me to give them a job. I’d be happy to give all of them a job, but there are just not enough places for them all,” she said.

TITLE: Atlant M to Build Car Village
AUTHOR: Alexander Filatov
TEXT: Special to Vedomosti
International automobile holding Atlant M plans to build a car village near St. Petersburg that will accommodate several car dealerships, selling different brands in the same place. The project cost has been set at $60 million to $70 million, with a similar village earmarked also for the Moscow region.
Atlant M is a Belarus-registered holding, specializing in the sale, guarantees and servicing of vehicles, as well as car component trading. In Russia, the holding runs official dealerships for Audi, Toyota, Volkswagen, Mazda, General Motors, Ford and others. In 2003, Atlant M sold 12,000 vehicles, with a total turnover of $260 million.
Plans for a car village near the city focus on a 15 hectare area by the ring road, which lies in the Leningrad Oblast, said Yelizaveta Kaprolova, brand manager for Atlant M in the Northwest.
The building works for the $70 million project will begin in the first half of 2008. Several city car dealerships are currently looking at the location and deciding on its suitability, said Alexander Butenin, press secretary for the committee for economics and investment in the Leningrad Oblast said.
A car village project, a concept that originated in the U.S. in the late ’50s, has also been launched in Moscow. Atlant M bought an 11 hectare area by the Moscow Ring Road (MKAD) in 2003, and in April this year the first dealership, Toyota Center Izmailovo, opened there.
The Moscow car village will have seven car dealers, and investments in the project make up $100 million, said Sergei Sklyarov, the brand manager for Atlant M in Moscow.
The holding’s rivals are preparing some alternative projects. Rolf group will develop several car village centers near Moscow, said Valery Tarakanov, marketing manager for the group. In Europe and the U.S. large auto-cities sprawl along the main highways.
“A client that passes by such villages can choose a car during the course of a day, seeing all the options. Meanwhile, dealers also win by saving on repair centers, parking, and warehouses that can be used by all,” Tarakanov said.
“We are saving money on the land prices, since it is cheaper in the region than in the city,” Sklyarov said.
Meanwhile, Roman Slutsky, head of Alarm Motors in St. Petersburg, a Ford dealership, calls such car village plans as a “mania for largeness.” Slutsky says it will be hard for dealers to maintain standards in a rural location.
Ford’s spokeswoman Yekaterina Kulinenko says that the company prefers for its vehicles to be sold separately, away from other auto brands.
“However, considering the trends on the market, we are not against Fords being sold alongside other brands that belong to Ford Motors Co., for example Volvo and Mazda,” she said. Any other “neighbors” would need individual assessment, Kulinenko said.

TITLE: Battle Over Baltika Spills Into Europe
AUTHOR: By Maria Levitov
PUBLISHER: Staff Writer
TEXT: MOSCOW — Minority shareholders in St. Petersburg-based Baltika brewery are gearing up for a court battle in their continued offensive against majority owner Baltic Beverages Holding, or BBH.
In order to beef up their recent victory, which stalled Baltika’s plan to purchase a 70.3 percent stake in Pikra brewery, minority shareholders plan to dispute the July 7 vote on the deal.
In that vote, they rejected Baltika’s plan to buy a majority stake in Pikra from BBH for $67.5 million, which they consider too high.
BBH, which controls a 75 percent stake in Baltika, is jointly owned by Scottish & Newcastle and Carlsberg.
Law firm Alimirzoyev & Trofimov — which represents the minority shareholders — will file a lawsuit before the end of this week to annul the July vote, according to an anonymous source close to the dispute.
Baltika says the purchase was blocked by a small margin, as 49 percent of minority shareholders approved the deal. However, the minority shareholders claim that the actual figure was no higher than 20 percent, the rest of the 49 percent being made up by shareholders linked to BBH and Baltika executives.
It is illegal for BBH to participate in the vote as it has vested interest.
BBH dismisses allegations of wrongdoing. “We would strongly defend our legal position,” BBH spokeswoman Linda Bain said.
Sergei Alimirzoyev, partner at Alimirzoyev & Trofimov, could not be reached for comment Monday.
 Bringing Pikra under Baltika’s control and consolidating BBH’s other manufacturing facilities in Russia will help the holding improve its operational management and stem brand competition within BBH, said Aton’s analyst Alexei Yazykov.
But the minority shareholders fear that the planned consolidation will result in the transfer of funds to Baltika’s majority stakeholder BBH, Alimirzoyev & Trofimov said in a statement.

TITLE: Pulkovo Picks Integration as Key to Success
AUTHOR: By Yekaterina Dranitsyna
PUBLISHER: Staff Writer
TEXT: A St. Petersburg-based firm declared that combining industrial production with construction in one single business is not only be novel idea, but a very profitable one.
Pulkovo industrial and construction corporation said its annual turnover had doubled over the last two years to reach 600 million rubles ($21 million) in 2004, mainly on the strength of being a company that integrates several business processes.
The concept brought little support from other members of the construction industry, however, who said it lacked the ability to support specialization and flexibility.
Pulkovo corporation, located near an airport of the same name, consists of a metallurgical plant, a concrete-making factory, a design bureau, a sandwich-panel production line (materials with silicate cotton inside), and a windows and fireproof door-making facility.
The company started operations in 2003, on the platform of the former Aeroportstroi state construction company. In its first year, Polkovo had a turnover of 300 million rubles ($10.5 million). But, with the figure for the first half of this year already reaching 500 million rubles, Pulkovo expects to beat the 1 billion rubles mark by December this year.
From being a general contractor for airport facilities, Pulkovo corporation widened its business sphere to building commercial constructions that included shops and service stations.
Valery Klimov, general director of Pulkovo corporation, said that the idea for integrating several business processes came because clients demanded a more wholesale approach to construction that the company originally offered. Orders for complete construction now account for 50 percent of Pulkovo’s business.
“We decided to produce not merely panels but walls ... Since contractors often let us down, we decided to build our own metallurgical plant too,” Klimov said last week at a press meeting.
The consolidation of all Pulkovo’s facilities into a 10,000-hectare territory took about three years, Klimov said. Investments into the metallurgical plant, equipped by Mercedes, Kaltenbah and Finn-Power, last year totaled 5 million euros ($6 million.)
Klimov forecasts a productivity rise from 600 tons of metal in a month to 1,000 tons by the end of the year.
“Pulkovo’s advantage lies in that it both carries out the engineering work, produces materials and builds,” said Boris Pugachyov, vise-president of St. Petersburg constructors association Soyuzpetrostroy.
Pugachev said the idea of integration was promising in itself, though “if Pulkovo were to create such a production complex from scratch, [Klimov] would choose more effective technical solutions. Now he has to keep with the existing production chain, which leads to expenses.”
However, some industry players doubt the efficiency of integration.
“Integration could bring about some sort of synergy, though not much. There is evident craftiness [in Pulkovo’s concept],” said Yuri Ioffe, vice-president of general contracting firm STEP.
While independent contractors are not tied to using particular construction materials, “Klimov has created one of the best metallurgy plants in Russia. So he would persuade his clients to choose metal instead of reinforced concrete just for that reason,” Ioffe said.
Ioffe disagreed that outsourcing parts of construction can lead to low service quality.
“Higher quality and efficiency are achieved mostly through specialization. That is the general trend. A company that takes care of its own engineering work could be more efficient only if it for some reason it were not possible to find an outsourcing partner,” Ioffe said.
Pulkovo corporation’s metal ware prices are higher than the market average, costing 45,000 rubles ($1,500) a ton. The corporation, however, can name a number of high-profile buyers of its sandwich-panels, firms such as Lufthansa, Ford, LUKoil, and Surgutneftegaz.
Opponents of business integration remain adamant, however, that the work method lacks flexibility.
“[Pulkovo’s operation] makes it difficult to balance capacity,” Ioffe said. “Two extra clients suddenly come in and Pulkovo either has to decline their orders or use contractors. Similarly, when orders are too few, the company will have to sell its construction materials to outside firms to cover the production volume.”

TITLE: St. Petersburgers Pay to Stay Forever Young
AUTHOR: By Yuriy Humber
PUBLISHER: Staff Writer
TEXT: Contrary to the historical image of the city, St. Petersburg’s citizens seem more and more willing to shed signs of age and choose to pay handsome prices for pre-emptive health strikes and cosmetically enhanced beauty.
By fall, a spate of anti-age treatment facilities will be running in the city’s clinics, charging as much as 3,000 euros just for a diagnosis, and advising well-to-do clients not only how to prevent illness, but also how to maintain their “wellness.”
“Wealthy Russians are becoming interested in prophylactic treatment,” said medical director of the American Medical Clinic, Yefim Danilevich.
The clinic opened its American Beauty Center, which deals with anti-aging medicine, this spring. Since then, Danilevich said demand has surged, especially in the spring and fall.
The beauty clinic attracts between 50 and 100 clients monthly, which Danilevich says is “quite a lot considering the prices.” American Beauty Center charges about 250 euros for the initial diagnosis and consultation.
Beginning this fall, Medem, a premium-class clinic that invested $20 million in new facilities and an anti-aging program two years ago, will delegate the program a separate 200 square meter facility.
“Interest has been growing so much that we can’t cope with the demand within the bounds of the hospital. The anti-aging program will be in a separate department within the clinic with its own entrance,” said Alexander Strelnikov, a medical director at Medem clinic and hospital.
Russia’s poor life expectancy rates give anti-aging medicine a natural appeal. In 2003, the average life expectancy of Russians was 64 years old, according to Rosstat, the federal statistics service.
U.S.-based backers of anti-aging medicine claim life expectancy can be boosted to 120 years old — that’s more than twice the life expectancy of a Russian male, which is 58 years old.
Unsurprisingly, the city’s clinics say the anti-aging service is “mainly orientated towards men,” which make up about 70 percent of the clients.
“Using anti-aging medicine, people in the U.S. at 50 are acting like 30 year olds,” Mark Gordon, a professor at the University of California and an anti-aging guru for several Hollywood stars, said during a visit to the city’s most recent addition on the scene, the Institute of Binary Anti-Aging.
The Institute — a private commercial center that holds a license for preventive prophylactic treatment — opened on Vasilyevsky Island last Friday. It says that it will be the first in the city to focus solely on anti-aging treatment, promising gene analysis, mental training, endocrinology, and hormone replacement therapy.
“We expect about 2,000 visitors a year, despite St. Petersburg not being a very wealthy city,” said Andrei Shmakov, head of the Institute of Binary Anti-Aging. A three-month treatment course — not including full diagnosis for up to 3,000 euros — will set the Institute’s clients back as much as 3,000 euros, Shmakov said.
The Institute plans to open offices in Moscow and the Baltic in the future, he said. With help from Gordon, the center also intends to start importing American vitamin and dietary supplements, from specialized companies such as Pure Encapsulation.
Gordon, also managing director at the Millennium Health Group for Anti Aging Medicine in California, says that St. Petersburg “already has all the technology for effective anti-aging treatment, it’s just not being applied.”
Medem’s Strelnikov disagrees, saying that this misses the point. “There is a complete lack of properly qualified staff in St. Petersburg. Even if we had all the right equipment or medicines here now, we would still not have the people who are trained to [use them or prescribe them],” he said.
The shortage could have drastic effects on the long-term future of the burgeoning industry, Strelnikov said.
“If 100 anti-aging clinics open in the city, treating people with all the knowledge that they got from the Internet, this area of medicine will die,” Strelnikov said. Medem has two internationally certified anti-aging doctors, he said.
Danilevich sees the outcome as less drastic. The explosion in the amount of “non-serious” anti-aging clinics in St. Petersburg will be most likely to affect the leisure industry, he said.
“[Such clinics] will attract those people who already attend fitness centers, cosmetologists, take non-traditional medicines, but without following any kind of system behind it,” he said.
“As long as the clinics provide fairly safe creams or tablets, it will not do any harm. If anything, it will be like buying an expensive placebo.”
A serious approach to anti-aging medicine, Danilevich said, must include “a special medical diagnosis, normal medical and prophylactic treatments, and particular cosmetology programs.”
Paradoxically, the number of anti-aging medicine clients in Russia is rising just as social researchers say life expectancy averages has lifted, helped by an improvement in living standards.
“The average life expectancy in Russia is not dropping, it is in fact increasing a bit,” said Alexei Moiseyev, senior researcher at CESSI, an institute for comparative social research in Moscow.
Moiseyev says that the number of Russians over 65 years old is going up, though this has little to do with medicine — even less with anti-aging. “It’s an interesting business idea,” he said. “But, it won’t have any effect on society.”

TITLE: IN BRIEF
TEXT: State to Regain Homes
ST. PETERSBURG (SPT) — St. Petersburg authorities will return state property ownership to desolate children’s camps located in the suburbs, the governor said Saturday, Interfax reported.
“Many camps were privatized previously. Some of them switched to other activities, the rest are still neglected,” Valentina Matviyenko said, stressing that such facilities should be made city property once more.
City authorities will finish property assessment by the end of the year. Ownership change will be performed by “mutual agreement, buyout or contra deal,” Matviyenko said.

’98 Debts Get Repaid
MOSCOW (SPT) — The European Court of Human Rights will for the first time consider the case of a Russian citizen who lost his savings during the August 1998 crisis, Kommersant reported. 
The Strasbourg-based court notified Sergei Zagorodnikov, who lost his deposits in Rossiisky Kredit bank, that his case might be heard as soon as this fall, the newspaper reported Monday. 
In November 1998, after Rossiisky Kredit had stopped paying back deposits, Zagorodnikov won a court ruling that the bank pay him $45,000, but he never received the money.
In 1999, ARKO, the state agency in charge of restructuring Russia’s credit institutions, arranged an amicable agreement between the bank and its depositors, but Zagorodnikov refused to sign it, claiming he would lose 15 percent of the money he was owed, Kommersant said.
In 2002, a Moscow arbitration court approved the amicable agreement reached by ARKO, after which the bank’s former depositor decided to file a complaint with the European court.

TITLE: IT Firms Call for Teaching Refo
AUTHOR: By Maria Levitov
PUBLISHER: Staff Writer
TEXT: MOSCOW — The IT industry is sending an urgent warning that plans to turn Russia into a high-tech powerhouse will fail unless government and businesses pay more attention to educating a new generation of specialists.
Ignoring the widening gap between the country’s stagnating educational system and the runaway development of the world’s information technology sector could threaten not only the country’s global competitiveness but also its national security, industry players say.
President Vladimir Putin has pledged to help diversify the country’s export base away from natural resources and toward high technology. But even as the government rushes to set up special economic zones for IT companies, there very well may not be enough qualified professionals to staff them. Although global IT companies operating in Russia are already helping to train the next generation of workers, educators are urging them to do more — and faster. 
“We live at a time when ideas and technologies are changing faster than generations,” said Vladimir Kinelyov, director of UNESCO’s Institute for Information Technologies in Education in Moscow, speaking at a recent round-table conference.
Five percent of the country’s work force, or four times the current ratio, will be employed in IT by 2008, when the industry is set to make up 10 percent of Russia’s gross domestic product, or double what it is today, according to government projections.
Whether those workers will command the same skills as their competitors overseas is another question. No more than 10 percent of IT graduates have the skills necessary to begin working right after graduation, according to a recent McKinsey survey of IT managers working in Russia, said Vitaly Klintsov, a partner at the consultancy.
“We need to stop preparing yesterday’s professionals,” said Yevgeny Butman, chairman of the committee on education and board member of APKIT, an association of computer and IT companies.
“The education system is in crisis,” said Vagan Shakhgildyan, president of Moscow Technical University of Communications and Informatics, or MTUCI.
A lack of new blood and top professionals among professors in IT disciplines is jeopardizing the future competitiveness of Russia and its national security, he said. 
The gulf between salaries in academia and in business is scaring away the best and the brightest from jobs in education, Shakhgildyan said.
A university professor typically earns $250 per month, said Vladimir Tikhomirov, rector at Moscow State University of Economics, Statistics and Information. To draw qualified IT specialists away from jobs in industry, he said, universities must offer at least $4,000 per month.
Luring young professionals to a teaching career with promises of a $2,000 monthly salary by the time they are in their forties is not going to work, Tikhomirov said.
Salaries in the private sector are rising much faster than salaries in higher education. And growing industry pay only exacerbates the problem, as IT professionals seek additional training to keep up with the demands of the labor market.
The majority of IT professors at Russian universities are older than 50 and are likely to retire soon, said Tikhomirov. Instructors often lack practical experience in cutting-edge technologies.
“Students who’ve had a chance to work find themselves speaking a different language from their professors,” said Andrei Kashutin, managing director of IT Dvizheniye, an association of nearly 7,000 IT students and young industry professionals.
Nevertheless, industry players are still holding out hope for improvement.
“Educational heritage and educational institutions are where Russia’s strength lies,” said Craig Barrett, board chairman of Intel, the world’s No. 1 maker of microchips. “There is still an opportunity to use IT as Russia’s next natural resource.”
The key, he said, lies in greater awareness by the government and more active involvement by the industry.
The business community is already becoming integrated with the educational process by encouraging investments and new technical skills, said Yevgeny Velikhov, president of Kurchatov Institute, Russia’s top nuclear research center.
For example, telecoms equipment company Ericsson has run a training center for clients and employees with MTUCI since 1996. Last year, the center opened its courses to students as well.
Intel has a program for training school teachers and works with the Russian Academy of Sciences to formulate up-to-date university curricula. Sun Microsystems partners with some 20 institutions of higher education in Russia to provide training to students and professors in its Java programming language.
But while many international companies have already opened training centers, MTUCI’s Shakhgildyan said there was a great need for more.
“To gain a strong footing in high-tech, [Russia] needs to instill a culture of continuous learning,” said Alexander Mikoyan, general director for Russia and Belarus at telecom company Alcatel.
Getting there is a common objective of the global technology giants muscling in on Russia’s market.
“We compete for the same human capital,” said Sergei Moiseyev, marketing director at Sun Microsystems.
“But when it comes to know-how and technology investments, we develop the market together.”

TITLE: Bourse News to Be Sent Via Mobile Phone
PUBLISHER: The St. Petersburg Times
TEXT: Hoping to capture the less SMS-conscious business market, INFON, a leading mobile content provider, launched a service to keep subscribers informed in real time about the latest moves in Gazprom shares.
Together with St. Petersburg-based MobileFinance, INFON will send out short message texts (SMS) to subscribed cell phone users that will note up-to-the minute changes in the trading of the gas monopoly’s shares, the content provider said last week.
The gas giant’s shares are the most liquid finance tool in Russia, with sales volume rising to 692 billion rubles ($24 billion) last year. The shares are traded only on the St. Petersburg bourse.
“The mobile content market offers mostly entertainment services, but analysts forecast a rising demand in the business segment. [Alerts about the latest in Gazprom shares] fall into this category,” Kirill Shramko, general director of INFON, said in a statement.
“The contemporary finance market is dynamic. Rates change fast, deals are struck every second and people [need] the news in time. Our offer is addressed exactly to market players,” Shamko said.
He added that soon the prices for Brent oil and the ruble exchange rate with euros and U.S. dollars will also be available.
Yury Novikov, deputy president of Solid, an investment and finances firm, thinks the SMS service could have real appeal.
“I know many Gazprom shareholders and they often seek information about the share prices. SMS reports could be of great importance,” Novikov said, adding that similar services already enjoy popularity in the West.
SMS texts announcing news about share moves will operate through INFON’s internet venture MyAlert.ru, which introduced financial services in June this year, informing subscribers about market price flotation based on Troika Dialog, Trust Investment Bank and Interfax data. 
As a portal, MyAlert.ru operates since 2003.

TITLE: Russians Trash Glitz for Smaller, Practical Cottages
AUTHOR: By Angelina Borovikova
PUBLISHER: Special to The St. Petersburg Times
TEXT: A man may boast of his home as his castle, but Russians are increasingly turning to building cottages that are plain, economical, and rather small.
Gone is the swagger of post-Soviet exaggeration, bulky turrets and superfluous spaciousness. Igor Firsov, head of architectural firm Art-Studio, says Russians have come to choose practicality over luxury.
“Times of such architectural extravagancies as turrets are passing. There’s a tendency to build smaller and smaller cottages. Five years ago the average house size was about 250 square meters to 300 square meters. Today, that ranges between 150 sq. m. and 180 sq. m.,” Firsov said earlier this month at a roundtable on cottage construction.
“It’s not usually sensible to build a house that’s less than 100 square meters, but even such projects already exist,” he said. Firstov added that the trend for smaller housing could continue for another decade at least, with the average house area set between 150 sq. m. and 180 sq. m.
Lans Development, a projects bank that sells its designs to developers, say up to 70 percent of clients prefer houses of average size.
“In the early ’90s a house was a symbol of welfare. But, the economic situation and mental attitudes have changed,” Nadezhda Roshchina, head of Lans Development, said at the roundtable.
“It’s not just that the size of houses is shrinking. [The change] has a lot to do with increasing comfort: People are picking optimal living space that can also fit in additional facilities such as a sauna,” she said.
In part, the trend towards optimization has a natural explanation, in that a larger home is much more difficult to maintain.
“Building castles, villas and mansions, examples of which can be encountered in the Leningrad Oblast, can’t determine the main tendencies of the out-of-town housing construction market,” Valery Kim, head of the Oblast’s architecture committee, said in an e-mail.
“Along with the huge construction costs, owners of such edifices stumble upon huge operating expenses, which sometimes total $1,000 a month,” Kim said.
“It seems more sensible to allocate the minimum living space of 50 sq. m. to 80 sq. m. for a private house. Or at a stretch, 90 sq. m. to 120 sq. m.,” he said.
Kim said that 335,000 sq. m of private housing was constructed in the Leningrad Oblast in 2004. Firsov said that the prices for cottages in the Oblast started from $800 per square meter.
The opinion of the roundtable’s architects was not shared by all in the industry. Igor Luchkov, analyst and manager of the department for valuation and consulting at Becar real estate agency, said the tendency towards smaller housing has not become defined.
“There’s a general decrease in demand at the moment. But it’s a seasonal swing,” Luchkov said. “In general, however, the trend is quite the opposite: the areas of new houses are increasing in certain market sectors.”

A WOODEN ALTERNATIVE
While 60 percent of cottages in the U.S. are built from wood, Russians tend to pick concrete or brick for their out-of-town accommodation, although some note this may be changing.
Firsov said that only 30 percent of his firm’s orders came in for wooden homes, and those were usually from clients looking for “something cheaper, like a country house.” He noted that the trend was especially distinct on the secondary housing market. “Selling wooden-frame buildings can be very difficult,” Firsov said.
However, Leonid Karankevich, manager of real estate sales at City realty, said that price played a more important role than material when selling a home. 
“Everything depends on the price. If one tries to sell a frame house for the price of a brick one, it won’t work, because building a new one would be cheaper. But if the price is reasonable, why not buy it?” he said in a telephone interview.
That wooden housing may be rising in popularity was affirmed by Mikhail Piltser, general director of St. Petersburg and the Oblast timber processors and furniture manufacturers association. Piltser said at the roundtable that the change owes something to involvement from the local authorities.
“There were two conferences held in the first three months of 2005, in which construction companies demonstrated their projects. [After them] the [Oblast] Governor [Valery Serdyukov] decided to hold conferences in 12 municipal districts to focus their attention on woodrn construction,” Piltser said.
Kim notes that already 31 percent of the Oblast’s private housing is wooden, while brick, block and concrete houses constitute a slightly higher 36 percent share, the rest being constructed from other materials. 
“In the Leningrad Oblast construction from wood processing waste materials has been developed to fulfill the criteria of social programs,” Kim said.
The idea of backing more wooden housing construction could be due to the material being more eco-friendly, well suited to the local climate, and relatively inexpensive, analysts said. 
“The most economical homes are the so-called block-houses, which sell at $100 per sq. m. Brick is the most expensive, about $700 per sq. m., excluding decoration. Wood is somewhere in between,” Karankevich said.

TITLE: Mall Cloning Gathers Speed as Brands Want to Stick Close
AUTHOR: By Yekaterina Dranitsyna
PUBLISHER: Staff Writer
TEXT: Though retail outlets built in central, mainly residential areas still attract some shop tenants, most are moving to malls.
The wise retailers are also considering the more remote districts, saying homogenous brand settlement appeals to consumers more than closeness to the city center.

The Move to malls
With the number of retail center projects exceeding capacity, developers have to work hard to attract lucrative clients, and large malls are winning out.
“Their trading spaces are larger, people spend more time in malls, doing some shopping and paying for entertainment, so the sales figures are bigger,” said Lyubov Orlova, public relation director for Piter Commercial Center. The company runs the Sennaya mall, the Sennoy and Troitsky markets, and plans to open a Piter mall in the Moskovsky district later this year.
“Malls help increase the retail chains’ turnover. For example, MEXX, Mango and Motivi clothes brands prefer being close to each other, because of a positive synergy the shops get from the proximity,” said Victoria Kulibanova, development manager of Astera.
Electronic retail chain M.Video says that malls account for the vast majority of its new shop locations, said Nadezhda Kiselyova, press secretary for M.Video. 
“M.Video opens hypermarkets mainly in malls now. It’s an efficient and democratic form of trade. The conveniences of a shopping mall are evident: Buyers can visit several shops at a time, have a snack in a cafe and so on,” Kiselyova said.
Monthly rent rates in malls vary between $30 and $80 per square meter, in some malls reaching $150, Kulibanova said.
In popular malls, such as River House, near the Petrogradskaya metro station or Gulliver near Staraya Derevnya rent rates amount to between $300 and $1,500 for square meter per year, according to property agency arendator.ru web site. 

GROWTH FACTOR
Shopping centers have became one of the most profitable investments in both the short-term (because of price growth) and the long-term (rent profits). Profitability varies between 15 percent and 20 percent, Becar real estate agency said in a report. 
According to Astera experts, the investment volume in a mall lies between $700 and $1,000 per square meter. With 18 percent to 20 percent profits, the return on investment can be between four and eight years.
Becar calculates that by spring 2005, St. Petersburg had 4.5 million square meters of commercial space. The figure will rise 20 percent this year and 10 percent in 2006, the agency said.
More than 60 shopping and entertainment center projects are currently in the process of being built, accounting for 2.2 million square meters of new commercial spaces. Of those, 17 centers will be completed this year, Kulibanova said.
Property experts disagreed on the necessity of such large-scale construction.
Orlova said a city like St. Petersburg will let new mall building continue for two to three years more. Then the growth will stop like in Baltic states.
Kulibanova disagrees. “The most saturated shopping areas are Vyborgsky, Primorsky and Moskovsky districts. Still, they attract the most active mall construction. About 21 percent of all building and engineering projects are located in the Moskovsky district,” Kulibanova said.

Extending to the suburbs
As in Moscow, more and more malls in the St. Petersburg area are heading out of the city center, where space for retail and parking is more attractive, industry watchers said.
One of the leaders in this has been Swedish giant IKEA. Krasnoselsky district and sleeping districts may become the next popular mall locations, Orlova suggested. Kulibanona indicated Vasilyeostrovsky district as the next hot spot.
Orlova points out that a major factor in location will be the completion of the city’s ring road, with Moscow retail chains already vying for nearby locations.
M.Video will open one of three new hypermarkets in the Grand Canyon mall later this year, because “it is an attractive location, practically near the ring road and not far from a metro station,” Kiselyova said.
“We assess mall attractiveness in terms of passing traffic volumes. In addition, Ramstore, Stockmann, Cinema Park and kid’s entertainment area Premier Park are also anchor tenants at this mall,” she said.
Brand recognition motivates many retailers to set up shop next to rivals and those that attract a similar audience. The danger with such familiarity of brand, however, is “sameness,” Orlova said. Piter hope to attract clothes brand Zara and some Baltic labels to St. Petersburg in the near future.

TITLE: RTS Index to Surpass All-Time High Record
PUBLISHER: The St. Petersburg Times
TEXT: MOSCOW — The benchmark Russian Trading System, or RTS, index came within striking distance of an all-time high on Monday, the first day of extended trading hours on the bourse.
The dollar-denominated index rose 1.18 percent to close at 779.19 points on the back of an almost 4-percent gain by Sberbank. The all-time high of 781.55 was set on April 12, 2004.
The RTS index has risen by 10.3% since the start of this month, and traders say they have never seen a summer rally like this before. 
Russian shares have soared after the conviction of Yukos CEO Mikhail Khodorkovsky in late May, as investors seek to put the Yukos affair behind them. 
Foreign money has again started chasing Russian shares as the perceived political risks ebbed and local companies raised record sums in initial public offerings abroad.  
Although the RTS index, dominated by commodity producers like LUKoil, Norilsk Nickel and Surgutneftegaz, is not a perfect reflection of Russian stocks on the whole, it serves as a historical indicator of market performance.
In the month ending July 22, the Morgan Stanley Capital International Russia index, which is followed by foreign investors, has risen by 9.05 percent. In comparison, Morgan Stanley’s MSCI Emerging Markets index gained 5.48 percent. 
The RTS’s rival, ruble-denominated MICEX index also posted gains of just over 1 percent to close at 702.46 on Monday.
The RTS expanded its hours this week, with the trading starting at 10:30 a.m. and ending at 6:45 p.m. to match those of MICEX. It was previously open between 11 a.m. and 6 p.m. 
MICEX’s longer hours have attracted investors away from the RTS over the years. Its daily volume overshadows that of the RTS, exceeding it by 15 times on Friday.

TITLE: IN BRIEF
TEXT: Loan Modernize Ships
ST. PETERSBURG (SPT) — North Sea Steamship (Severnoye Morskoye Parochodstvo) took out a $1 million short-term loan from St. Petersburg-based Sovetsky bank, the company said Monday in a statement.
The loan will go for technical modernization of acquired ships, North Sea Steamship. The company refused to reveal loan interests.
The main stakeholders of North Sea Steamship are Arctic Technologies (54 percent) and the state (20 percent).


IFC Lends to Absolut
ST. PETERSBURG (SPT) — The International Finance Corporation, the private sector arm of the World Bank Group, will invest $10 million in Absolut bank and provide it with a $15 million mortgage loan, the corporation said Monday in a statement.
The investment will help Absolute to expand operations, opening 20 more branches in the Moscow region and St. Petersburg markets, the statement said. It will also be used to boost the bank’s residential mortgage lending program in Russia.
The corporation will, furthermore, act as an advisor to the bank on how to strengthen corporate governance practices and mortgage lending operations, IFC said.
“We are pleased to work with Absolut bank, a middle-sized Russian bank with increasing regional coverage and a strong market share,” said Edward Nassim, IFC’s Moscow-based Director for Central and Eastern Europe. 
Absolut Bank, established by the shareholders of the Absolut Group, has total assets of about $500 million and equity of $77 million, the bank said.

Spending on Disabled
MOSCOW (SPT) — The government will spend 1.5 billion rubles ($53.5 million) next year on organizations for disabled to compensate for benefits they lost earlier this year, a top government official said Monday.
“After a whole range of tax breaks for the disabled organizations was abolished the government felt obliged to compensate for the lost benefits,” Alexander Zhukov deputy prime minister told President Vladimir Putin on Monday, Interfax news agency reported.
Zhukov said that 1.5 billion rubles will be allocated next year and that sum will increase in the future.
Zhukov said the Cabinet would discuss the new program of disabled support at its Thursday meeting.

Roadmap For Cars
MOSCOW (SPT) — The Industry and Energy Ministry said Monday it has adopted a new plan that sketches out the strategy for Russia’s automotive industry through 2008.
The plan is designed to bring Russia into line with import and safety standards used around the world and ease export of the Russian-made cars, the ministry said in a statement.
In May, the Cabinet approved the country’s medium-term automotive strategy but said it had to be refined before the Industry and Energy Ministry could officially adopt it as a plan for action.
KazMunaiGaz Sale 
n LONDON (Bloomberg) — KazMunaiGaz, Kazakhstan’s state-owned oil company, denied a report in London’s Sunday Times that its exploration unit plans to sell more than $1 billion worth of shares.
The Kazakh government may sell 49 percent of the unit in London as early as September, the Times said without saying where it got the information. 
The government is being advised by ABN Amro Holding NV and Credit Suisse Group, it said.
“We don’t know where this information came from,” Lyazzat Kokkozova, a spokeswoman for KazMunaiGaz Exploration and Production, said by phone from the Kazakh capital of Astany. “We aren’t aware of this.”

36.6 Chain Plans More
MOSCOW (SPT) — Pharmacy chain 36.6 said Monday it would open 140 new outlets this year.
The chain also aims to increase sales to between $500 million to $800 million by 2008. 
“By end of this year, we plan to continue acquisition in priority regions of Russia and open new drugstores,” the company said in a statement, Interfax reported. 
The company will develop its business in the Urals, the Volga region, the central part of Russia and the country’s Northwest, mainly in St. Petersburg.
Last year the 36.6 chain already had 253 drug stores in 40 cities in seven regions of Russia.
In 2004, the company generated $210 million in sales, according to its web site.

TITLE: Zoned In: the Limit of Special Economic Zones
AUTHOR: By Andrew B. Somers
TEXT: On the last day of its spring session, the State Duma adopted a law on Special Economic Zones, which was signed by President Putin on July 23. While anticipated by the international business community to boost development into knowledge-based sectors of the economy, the law left many international investors disappointed. Such pessimism is justified only partially.
The law has two very strong positive aspects to it. First, it establishes the legislative base for creating manufacturing and technology zones with special customs and tax regimes and reduced bureaucracy. And second, the idea for creating special economic zones did not languish, and a half year after the concept was announced, a law has been passed.
Having been adopted, now a wide range of legislative and regulatory issues are ready to be resolved by the government and the Duma, hopefully in a timely fashion.
Many of those issues have already been identified by the business community, and foreign business advocacy associations have informed the relevant Duma committees and government agencies about them. The following are some of the key drawbacks of the current version of the law.

THE FIVE FALLS
First, in order to qualify for favorable treatment, investors will have to create an entire infrastructure from nothing. Territories that have already been invested in will not be considered (“greenfield principle”). This puts existing investors at a disadvantage.
Second, the law bans branches from registering in the special zones. For many companies, it would be disadvantageous to create separate legal entities, and again, this provision substantially constrains existing investors.
Third, the law provides only for the state ownership of land and outlines rather strict constraints for allocating land and defining its size. This will restrain technopark development and will minimize the zones’ impact on regional economies and the national economy as a whole. 
Fourth, the law puts a special federal body in charge, creating excessive administrative centralization. And fifth, the law does not solve the problems of customs and export control.
Some important positive amendments to the law after its first reading were suggested by the private sector, and were incorporated by the State Duma in the final version of the law. The size of the zones was increased from 10 sq. km to 20 sq. km, allowing for companies’ growth and providing for greater impact on regional economies.
And by creating Advisory Councils for each zone, the law sets more transparent procedures and criteria for admission and provides for self-regulation mechanisms.
THE THREE ISSUES
To achieve the intended results of the law — aggressive growth of hi-tech industry, effective transfer of R&D results in industrial production, attraction of international capital and know-how, and ultimately, increased diversification and competitiveness of the Russian economy — several other important conceptual and technical suggestions should be considered.
“Technopark status” should be granted based on a company’s core activities, not on its location. To do that, only three major issues need to be solved. 
The first is the further liberalization of customs control, beyond what the current law provides. The approval procedure for importing products into the free customs zones with the possibility of amending the list only four times a year makes it impossible to use the customs regime for products with short life spans, i.e. for the majority of electronic and computer equipment.
Second, export controls should be further liberalized as well. And third, special immigration policy should be developed to attract a qualified workforce from other regions. A special law on technoparks may be the way to go, which will let regional authorities adopt their own legislation in accordance with federal laws.
Our past experience shows that legislative shortcomings can be remedied through diligent monitoring of implementation and constructive dialogue with legislative and regulatory bodies. This has been the case with the new Customs Code and has yielded tangible positive results.
The Ministry of Economic Development and Trade and the Duma Committee on Economic Policy expressed a willingness in the fall to review the law on Special Economic Zones and accept recommendations for its improvement.
We will continue working with all relevant state bodies to effectively convey the concerns of the business community to improve the law and promote aggressive growth of Russia’s IT industry.

Andrew B. Somers is president of the American Chamber of Commerce in Russia, one of the leading foreign business advocacy associations. He contributed this comment to The St. Petersburg Times.

TITLE: The Tragedy of the Warehoused Children
AUTHOR: By Masha Gessen
TEXT: Let me tell you about my son. He is very handsome, with dark eyelashes that cover half his cheek when he sleeps. He is very talented, and serious about his violin. He is absolutely charming. Everyone who meets him falls in love with him: grown-up women and men, little boys, all of whom want to be his friend, and, especially, little girls, who have been known to get into fights over him.
He will be 8 in August. I’ve only known him for five of those years — this week marks an anniversary of our first meeting. Back then, he could say all of 11 words and he could not tie them together to form a coherent sentence. He also could not: catch a ball; walk backward; walk forward while pulling a wagon; jump or run. He still wasn’t rid of the baby habit of grasping and holding on to everything within reach. In other words, he was seriously developmentally delayed.
I wish I could say my partner and I were super-parents. In fact, we were as clumsy and unprepared as any first-time adoptive parents of an older child. We were alternately too strict and insufficiently attentive. We demanded too much of him at times and failed to help him learn at others. 
Still, within three months, he caught up to his age level developmentally. Simply living at home seemed to be the best medicine. Now he goes to a good school, where everyone loves him, takes music lessons, and loves to spend his spare time performing acrobatic feats on his trapeze set. In other words, as I’ve already said, he is the best and most remarkable of kids.
Ours is a slightly unusual adoption story. The reason my son was so severely delayed, despite his above-average intelligence and extraordinary abilities, is that he had spent the first three years of his life not in an orphanage but in a hospital. This is what happens to children who are born to women who test positive for HIV. As hospitals go, this was a good one: The children went out on walks every day, and after the age of 2 they even had a half-time teacher (before that, the hospital could find no one but nurses to work with the children — all others were too afraid). I’ve seen a lot worse: 3-year-olds who have never been outside. 
In a new report by Human Rights Watch titled “Positively Abandoned,” a doctor describes a 3-year-old who could not talk or swallow food and was generally at the developmental level of a four-month-old. She had been warehoused at one of the worst places for the children of HIV-positive women. Early childhood psychologists were unable to help her, and after a year of trying, they made the unfathomably reasonable decision to send her back to the hospital where she had been housed for the first three years.
When an HIV-positive woman goes to a doctor for prenatal counseling, she is often advised to have an abortion or, if it’s too late, to give up her baby. The counselors tell the woman — who, more likely than not, has only just found out about her infection — that she will soon be sick and dying, certainly unable to care for a child. If she is, or was, a drug user, this is another reason the doctor is likely to consider her an unfit mother. The state, the argument goes, would do a better job. If the woman keeps the baby, she is likely to get the same counsel from her local pediatrician when she or he arrives for the first home visit.
According to the Human Rights Watch report, between 10 percent and 20 percent of the babies become wards of the state. At least some of them would probably be better cared for at home, by the mother or her relatives. In any case, the state places all of them in conditions that often make regular Russian orphanages look good in comparison. 
Most of the children, like my son, are HIV negative (the virus is rarely passed from mother to child at birth, and when the necessary precautions are taken, the risk is virtually eliminated), but for unscientific, discriminatory and blatantly illegal reasons mainstream orphanages reject them, at least until they reach the age of 3. Among other things, this means that the children, while legally eligible for adoption, do not become part of the big database through which prospective adoptive parents could find them. 
Even if the children are HIV negative, they remain marked for life. During our own adoption process, well-intentioned orphanage and adoption officials kept asking me if I was “aware of the boy’s diagnosis.” I kept explaining to them that, being HIV negative, he was healthy. 
“You are so brave,” they would say over and over again.
In fact, I haven’t been brave at all. I’ve hidden his original medical history very far away. I’ve never mentioned the fact of his biological mother’s HIV to a single school nurse. He has never been to a state clinic.
I was hesitant to write this column. I am able to afford both private health care and private schooling for my son. I am also capable of talking back very loud in at least two languages to anyone who says a bad word about him or our family. And if someone as privileged as I am is afraid to talk about this, then either I’m a desperate coward or this country is insane. I’m fairly certain of the latter. 
Look at my son — or imagine him as I’ve described him. Now think about this: He was warehoused for the first three years of his life. Thousands of other kids still are.

Masha Gessen is a contributing editor at Bolshoi Gorod.

TITLE: Border Dispute Has No Substance, But is Democracy in Action
AUTHOR: By Vladimir Gryaznevich
TEXT: The scandal over the  Russian-Estonian border agreement should be used in political science textbooks as a good example of how normal political systems work in a democracy. The reaction of the Russian public to the events was the only abnormal thing about the story.
Let me summarize the course of events. On May 18 the heads of the Russian and Estonian foreign ministries signed an agreement on the Russian-Estonian state border. For the agreement to come into force, it had to be ratified by both countries’ parliaments and signed by their presidents. On June 20, the Estonian parliament ratified the agreement. But on June 22 the Russian Foreign Ministry declared that it would withdraw its signature from the agreement and that it could not present it to the Federation Council for ratification.
The ministry justified its withdrawal by saying that the Estonian parliament had incorporated matters into the text of the agreement that were unacceptable to Russia. Specifically, it had referred to the Tartu peace treaty of 1920 and the declaration of the Estonian State Council of 1992 that referred to the restoration of constitutional order in Estonia. Asked why that should concern Russia, Foreign Ministry staff said, “the declaration refers to ‘aggression by the Soviet Union against Estonia’ in 1940 and ‘occupation,’ and the ‘illegal’ incorporation of Estonia into the Soviet Union. And the Tartu treaty contains a series of claims to Russian territory.” Therefore, the ministry said, the document “creates a false context for the interpretation and realization of a border agreement.” President Vladimir Putin translated this for the man on the street: “Included in the agreement, reference to the Tartu treaty creates a basis for territorial claims against Russia. We will never agree to that.”
Russia then launched an anti-Estonian campaign. With a rare show of solidarity, people of widely differing convictions, including Kremlin opposition, appeared in the mass media and criticized Estonia. They said its behavior was tactless. Why did Estonia have to scratch old wounds and remind Russia how the Soviet Union annexed Estonia?  Was it even an occupation, after all? And after all,  knowing  how sensitive the Kremlin is to this subject, why would they “tease the geese”? As regards the territorial claims, in this Putin’s supporters and the democrats were united. In general, the view was that the Estonians were wrong on all counts and had deliberately provoked  Russia, so as not to have to legalize the border. The Foreign Ministry added, with the tone of one who has been offended: “In this way, disregarding the goal of many years of work, the signing of the agreement was blocked.”
A lot of work had gone into the agreement. Mikhail Margelov, head of the Federation Council’s international relations committee, said that  the border agreement was a good idea. “We started out in good faith and exchanged several parcels of territory. In addition, the Estonian government bought some land from farmers so that the border would be normalized in the Pskov region.” 
So did Estonia have no intention of completing the agreement? And was Russia the only country that the agreement would benefit? This  view doesn’t make sense. Right-thinking Russians  , including political commentators, should be perplexed.  They should find answers to their questions and pass them on to the public. But such people have not appeared, not even on Ekho Moskvy or Radio Liberty. But finding the answers is not difficult — there are plenty of them on the Internet.
For example: the Estonians did not make any connections between the current border treaty and former territorial claims, nor did they demand that Russia recognize the fact that Estonia had been occupied. From the point of view of international law, the only legal force for Russia and Estonia is in the text of the agreement. And the Estonians did not touch it. All that is contained in the text of the Estonian law on ratification of the agreement with Russia is pure lyricism. It has no legal consequences even for Estonia, or for the Tartu treaty, according to which the communist government of Russia in 1920 transferred to Estonia parts of the Petersburg and Pskov provinces (the Pechora district), which had at that moment been annexed by the Estonian army, and which in terms of international law has long expired. Which, by the way, was noted by the Russian Foreign Ministry.
Therefore it would be nonsense to fear territorial claims from Estonia. Such claims would have little force. For instance, the Nystad peace treaty of 1721 said that the provinces of Liflyandiya, Estlyandiya, Ingermanlandiya would all be part of Russia “for eternity and without any right to question.” As regards the Soviet occupation of Estonia, that fact has long been recognized by the international community, as it was by this country in the dying days of the Soviet Union, So there is nothing new in the references, and they have no legal power.
Why then is the Russian Foreign Ministry so worried? There could be several different reasons. The  Estonian slap in the face serves as a warning to Latvia. As Margelov says: “The situation with Latvia is significantly more complex because the Latvian political elite, in my opinion, have not sorted out who they are. I think that in Latvia the contradictions continue between the Interfront and the People’s Front, in other words, their political reorganization is not completed.” And Russia still has to conclude border agreements with Latvia too.
Apart from that, the scandal with Estonia is useful to the Russian government as a way of unifying a divided government in the wake of the Yukos affair. And here the success of the Foreign Ministry can be seen — a wave of patriotism has been able to calm opposition to the Kremlin.
And the reason why the Estonians created a scandal is also no secret. Under Estonian law, to ratify the border treaty, two-thirds of votes in parliament were needed. And the opposition holds a third of all votes — that meant from the very beginning the document would be saddled with some odious reminders. With much effort it was possible to persuade the opposition not to spoil the text of the border agreement — but some of the reminders went into the ratification law. In addition, in contradiction to the statements of Russian politicians, there is no reference to the Tartu treaty, only to the order of the Supreme Soviet of the Estonian Republic of 1991 called “Of the state independence of Estonia,” in which, it is true, the Tartu treaty is mentioned. The ratification would not have been possible without some compromises.
This doesn’t mean that the Estonian opposition groundlessly acted against the interests of its country. Its motives are clear — a recent survey by the polling firm Emor in June found that opposition parties have an extremely low rating. The Fatherland Union is supported by only 8 percent, and the Res Publica party by just 4 percent. They have to raise their ratings and their only chance is to create a wave of patriotism, playing on the remaining complexes of a significant part of Estonia’s population. They understood perfectly well that the treaty with Russia would be signed anyway, so the interests of Estonia would not suffer.
Margelov said that talks with Estonian deputies will gradually resume. The border may have to wait a bit longer — we have somehow lived 15 years without an agreement, so it’s not so bad. There is no need to get upset — the history of the agreement is a normal episode in the political process of democratic countries.

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: Master Plan
AUTHOR: By Chris Floyd
TEXT: The United States long ago ceased to be anything like a living, thriving republic. But it retained the legal form of a republic, and that counted for something: As long as the legal form still existed, even as a gutted shell, there was hope it might be filled again one day with substance.
But now the very legal structures of the Republic are being dismantled. The principle of arbitrary rule by an autocratic leader is being openly established, through a series of unchallenged executive orders, perverse Justice Department rulings and court decisions by sycophantic judges who defer to power — not law — in their determinations. What we are witnessing is the creation of a “commander-in-chief state,” where the form and pressure of law no longer apply to the president and his designated agents. The rights of individuals are no longer inalienable, nor are their persons inviolable; all depends on the good will of the Commander, the military autocrat.
President George W. Bush has granted himself the power to declare anyone on earth — including any U.S. citizen — an “enemy combatant,” for any reason he sees fit. He can render them up for torture, he can imprison them for life, he can even have them killed, all without charges, with no burden of proof, no standards of evidence, no legislative oversight, no appeal, no judicial process whatsoever except those that he himself deigns to construct, with whatever limitations he cares to impose. Nor can he ever be prosecuted for any order he issues, however criminal; in the new American system laid out by Bush’s legal minions, the Commander is sacrosanct, beyond the reach of any law or constitution.
This is not hyperbole. It is simply the reality of the United States today. The principle of unrestricted presidential power is now being codified into law and incorporated into the institutional structures of the state, as the web log Deep Blade Journal reports in a compendium of recent outrages against liberty.
For example, last Friday, a panel of federal judges — including John Roberts, nominated to the Supreme Court last week — upheld Bush’s claim to dispose of “enemy combatants” any way he pleases, The Washington Post reports. In a chilling decision, the judges ruled that the Commander’s arbitrarily designated “enemies” are nonpersons: Neither the Geneva Conventions nor American military and domestic law apply to such garbage. Bush is now free to subject anyone he likes to his self-concocted “military tribunal” system, a brutal sham that retired top U.S. military officials have denounced as a “kangaroo court” that tyrants around the world will cite in order to hide their oppression under U.S. precedent.
The kowtowing court ruling ignores the fact that the Geneva Conventions — which lay down strict guidelines for the handling of any person detained by military forces, regardless of the captive’s status — have been incorporated into the U.S. legal code, Deep Blade points out. They cannot be abrogated by presidential fiat. And anyone who commits a “grave breach” of the Conventions by facilitating the killing, torture or inhuman treatment of detainees (e.g., stripping them of all legal status and subjecting them to rigged tribunals) is subject to the death penalty under U.S. law.
This is why the Bush Faction labored so mightily to advance the absurd fiction that the Geneva Conventions are somehow voluntary — while simultaneously promulgating the sinister Fuhrerprinzip of unlimited presidential authority. The fiction was a temporary sop to the crumbling legal form of the Republic, a cynical perversion of existing law to keep justice at bay until the Fuhrerprinzip could be firmly established as the new foundation of the state.
It doesn’t matter anymore if the president’s orders to suspend the Conventions, construct a worldwide gulag, torture captives, spy on Americans, fabricate intelligence and wage aggressive war are illegal under the “quaint” strictures of the old dispensation; the courts, packed with Bushist cadres, are now affirming the new order, the “critical authority” of the Commander, beyond law and morality, on the higher plane of what Bush calls “the path of action.”
This phrase — with its remarkable Mussolinian echoes — was incorporated into the official “National Security Strategy of the United States,” promulgated by Bush in September 2002. That document in turn was drawn largely from a manifesto issued in September 2000 by a Bush Faction group whose members included Dick Cheney, Don Rumsfeld, Paul Wolfowitz and Jeb Bush. Their detailed plan envisioned the transformation of America into a militarized state: planting “military footprints” throughout Central Asia and the Middle East, invading Iraq, expanding the nuclear arsenal, massively increasing the defense budget — and predicating all these “revolutionary” changes on the hopes for “a new Pearl Harbor” that would “catalyze” the lazy American public into supporting their militarist agenda.
This agenda is designed, the group said, to establish “full spectrum dominance” over geopolitical affairs, assuring control of world energy resources and precluding the rise of “any potential global rival” that might threaten the unchecked wealth and privilege of the U.S. elite. The rule of law could only be a hindrance to such a scheme, hence its replacement by the Fuhrerprinzip and the “path of action.” 
There has been virtually no institutional resistance to this open coup d’etat. It’s now clear that the American Establishment — and a significant portion of the American people — have given up on the democratic experiment. They no longer wish to govern themselves; they want to be ruled by “strong leaders” who will “do whatever it takes” to protect them from harm and keep them in clover. They have sold their golden birthright of American liberty for a mess of coward’s pottage.

TITLE: As U.S. Ambassador Bids Goodbye, Russia Remains on His Radar Screen
AUTHOR: By Lynn Berry
PUBLISHER: Staff Writer
TEXT: U.S. Ambassador Alexander Vershbow had been in the job only a couple of months when the terrorists struck on Sept. 11, 2001. The attacks brought an outpouring of sympathy in Russia for Americans, as evidenced by the flowers that piled up outside the U.S. Embassy, and ushered in a period of cooperation between Washington and Moscow that looked set to change the relationship forever.
It was an exciting time to be the new American ambassador.
Four years later, as he wraps up his tour, the outlook is much less bright. Anti-American sentiment is running high, with Ukraine and adoptions serving as some of the latest flash points. U.S.-Russia relations have taken on tinges of the Cold War, and the energy dialogue, started in 2002 with such fanfare, has stalled.
Yet in looking back, Vershbow, who left Moscow on Friday, said the balance sheet was still positive, despite the setbacks and U.S. concerns about the course Russia is taking under President Vladimir Putin. 
“You can say it’s been a successful period, but some of the old frictions that we thought were in the past have come back,” he said in an interview. “Some of them are based on our reaction to internal trends here; some of them reflect a resurgence or the reappearance of the old mentality, which may be exacerbated by the prominence of siloviki in key leadership positions.”
Vershbow was never shy about communicating U.S. concerns, whether over the conflict in Chechnya or the case against Yukos. He maintained a high public profile, giving many interviews to Russian newspapers and appearing on Russian television, speaking in Russian. But as his time here wound down, and the farewell interviews and speeches filled his schedule, he began to speak perhaps more candidly than before.
In a recent one-on-one interview, he shared his thoughts on a wide range of issues related to U.S.-Russia relations and developments in Russia itself. 
He also talked about his life here as ambassador — the personal joys and frustrations — and his thoughts on what he might like to do once he eventually leaves the diplomatic service. 
Throughout the interview, as throughout his four years here, his strong attachment to the country was evident. He called Russia his first love, since he started studying the language when he was 15, a year before he met his future wife, Lisa. 
Vershbow, now 53, made his first trip to the Soviet Union when he was 17, coming for a language program in the summer of 1969. Ten years later, he returned as a young diplomat on his first foreign posting. 
After serving as U.S. ambassador to NATO, he was sent back to Moscow as ambassador in July 2001. He soon made his voice heard. Vershbow said he made a conscious decision to “engage the Russian media, in trying to challenge some of the stereotypes that they have and the misperceptions about our policy, and also to talk up particular issues where we see problems that need to be addressed, whether it is sensitive issues like the independence of the media or social problems that they’re not paying enough attention to, like HIV/AIDS.”
A music lover, he also took on the role of cultural ambassador, assisted by his wife, an artist and jewelry designer. They invited hundreds of Russians to balls and musical evenings at their residence, Spaso House, and were regulars at the Conservatory.
The ambassador, a drummer, played with Igor Butman’s jazz band on 15 occasions over the years. “He always chooses something relatively easy, since I play more rock than jazz,” Vershbow said. At his final performance in Moscow last week he played “I Feel Good” by James Brown. 
He said he also made guest appearances on the drums in Novosibirsk and Saratov, and even picked up a guitar for a rendition of “The House of the Rising Sun” at a Rotary Club meeting in Kamchatka in April.
“It’s my secret diplomatic weapon,” he said.

Politics vs. Economics
One of the priorities of the U.S. government from the start of Vershbow’s tour was furthering economic ties, particularly in the energy sector. The United States wanted to see Russia expand its export capacity to become a bigger supplier of oil to the U.S. market, and to open up Russian fields to investment and exploration by U.S. companies. With the exception of ConocoPhillips’ deal with LUKoil, none of this has happened. 
“It seemed that a combination of their own internal problems and a spillover from our bilateral relationship — some of the more difficult events, whether it’s Iraq or the Yukos case — has led the Russians, in my view, to put politics ahead of economic logic,” Vershbow said.
What was not clear, he said, was whether Russians simply saw the energy dialogue differently from the beginning or whether developments caused them to change their strategy.
“Things have been changing so continuously. You just have to look at the state reasserting its dominance, literally taking control through its dismantling of Yukos, and now Gazprom may be buying Sibneft. So clearly the majority view among the powers that be is that it was a mistake to so thoroughly privatize the oil sector and they are restoring state control. 
“It’s their country, it’s their natural resources. We don’t deny them the right to make these decisions, though the way they’ve done some of the things has certainly raised eyebrows. But we do object when some specific decisions are taken to stymie development of their own energy resources, such as the cancellation of Sakhalin-3.” ExxonMobil and Chevron won the tender to develop the field, but the results were abruptly annulled in January 2004.
The most promising area now for U.S. energy companies would be to work with Gazprom on producing liquefied natural gas, he said. Gazprom is in discussions with several U.S. companies on the development of the giant Shtokman field.
“We don’t know yet if they are seriously looking for a U.S. partner or whether politics will again lead them to choose someone else,” Vershbow said.
The other question was whether the Russians would be prepared to establish equal partnerships with U.S. companies, he said. 
“This means equal division of the so-called value chain, giving our companies some equity in the reserves and the upstream development in return for Gazprom getting some equity in the downstream. ... If Gazprom wants the latter but isn’t prepared to share the former, then our companies aren’t going to come.”
Would U.S. companies also be willing to work with the state oil company, Rosneft, after its takeover of Yukos’ main production unit? “I think our companies are very adaptable,” Vershbow said. “They were partners with Rosneft in Sakhalin-3.”
The main problem in the oil sector, he said, was that the rules had not been defined. “They clearly have changed, but we’re not sure where they’re going to end up. And the constant message from [U.S. Energy Secretary Sam] Bodman, [U.S. Commerce Secretary Carlos] Gutierrez and everybody else who comes through here is, establish some clear rules, define what’s strategic, what’s not strategic, pass the necessary laws, implement them fairly and don’t change them.”

Talks With Khodorkovsky
Vershbow said the ultimate impact of the Yukos case on the investment climate was not yet known because it was still not clear whether it was an isolated case or whether it was a pattern that would repeat itself. 
“But I think the bottom line is that international investors and particularly the energy companies do want to get into the Russian market,” he said. “They are hoping it was a one-off and that stable rules are clarified and maintained.” 
Before former Yukos CEO Mikhail Khodorkovsky’s arrest in October 2003, they used to see each other periodically, Vershbow said. They discussed energy issues — disagreeing on production-sharing agreement legislation, which Yukos was lobbying against — and broader themes. “He was interested in explaining his vision of Russia’s future and why he had started his Open Russia foundation and why he was sponsoring so many different activities focused on developing the new, younger generation,” Vershbow said.
“He would hint at his plans to become more politically involved when he retired from business. It was interesting hearing his views. But throughout the whole process he was very self-confident that he was virtually invulnerable.”
As to why Khodorkovsky felt he would not be arrested, Vershbow said he thought “the common theories apply,” including that Yukos was a major contributor to the federal treasury and that Khodorkovsky had become an international figure with connections in high places. But the ambassador said he thought the Yukos chief had been counting less on his friends in the West and more on his “internal strengths and allies,” such as presidential chief of staff Alexander Voloshin, who later resigned over the Yukos affair.

NGOs, IPR and HIV
During his four years in Moscow, Vershbow dealt with a series of contentious issues that strained U.S.-Russia relations, from the Russian ban on U.S. poultry imports in 2002 to the ongoing furor over the deaths of adopted Russian children in the United States.
Perhaps the biggest cause of tension at the moment is the Russian perception that the political change in Ukraine and other former Soviet republics was funded by the West, in particular the United States, and aimed at undermining Russia. 
Putin recently warned Russian nongovernmental organizations that foreign money was not to be used for political activities in Russia. 
The U.S. Congress is on track to allocate $85 million in assistance for Russian civil society next year, the same amount as in 2005. The money goes to a whole range of NGOs, including those that support the handicapped and orphans. Vershbow said some of this money supported Russian NGOs that do things like election monitoring and provided basic training for political parties, with the aim of helping create conditions for free and fair elections. 
“We think that it’s an investment in a stronger Russia that will become a more reliable partner and a more responsible international citizen,” he said in the interview, which took place before Putin spoke on the subject.
Vershbow said one reason the U.S. government considered it important to support NGOs in Russia was that they had few sources of domestic support. The arrest of Khodorkovsky sent a strong message to the private sector that funding NGOs and political parties would not be looked upon favorably.
“So if there were alternatives we would be delighted to shift some of our resources to other parts of the world,” he said.
Yet despite the tensions and setbacks in U.S.-Russia relations over the past four years, Vershbow said the positive still outweighed the negative.
On the positive side, he pointed to cooperation during the campaign in Afghanistan, a convergence of positions on Iran’s nuclear program, a shared agenda regarding North Korea and Russia’s willingness to move forward on Iraq after opposing the U.S. decision to invade.
He also talked about the importance of joint work between U.S. and Russian government agencies in a variety of areas, such as law enforcement and space. The U.S. Energy Department and the Russian State Customs Committee recently opened a new command center in Moscow aimed at improving Russia’s ability to prevent illegal trafficking in nuclear materials.
Vershbow said Russia had begun paying more attention to the problems of HIV/AIDS and protection of intellectual property rights, in large part as a result of U.S. efforts.

On the Radar Screen
There is a perception in Russia that the country no longer occupies an important place on Washington’s radar screen, but Vershbow said there was plenty of high-level interest in Russia. It just takes different forms than it did during the Cold War, when the entire relationship revolved around the superpower confrontation. 
“Often our engagement with Russia is in the context of dealing with some specific problem rather than revolving around the bilateral relationship itself,” he said. 
“So we engage heavily with Russia on the Middle East, or postwar Iraq, or Afghanistan or terrorism, or financing of the global fund for AIDS, as opposed to having the classic 39-point agenda of bilateral questions that occupy the top leadership. 
“I think that’s healthy, though. I think it reflects the fact that the relationship has become more normal and that on most issues we are pulling in the same direction.”
Russia also seems certain to stay on Vershbow’s radar screen. 
Vershbow said he was not yet ready to leave the diplomatic service, but he hoped that when he did he would find a position that would bring him back to Russia occasionally. He said he would want to be still involved in policymaking, rather than in business, perhaps with a think-tank or an NGO. 
“As ambassador, you meet lots of people but you don’t have time to develop close friendships,” he said. “I look forward to someday coming back.”
Although Vershbow has not yet received his next posting, he is widely expected to be named ambassador to South Korea in the coming months.
On his final day in the job, he was the first to formally announce that the new U.S. ambassador in Moscow would be William Burns, a career diplomat who until March had served as assistant secretary of state for Middle East affairs. Burns was a political officer in Moscow 10 years ago. 
True to form, Vershbow made the announcement, in Russian, on Radio Mayak.

TITLE: Police Hold Three in Botched London Attack
AUTHOR: By Patrick Quinn
PUBLISHER: The Associated Press
TEXT: LONDON — London police have three suspects in custody after last week’s failed terrorist strikes but say they are looking for more because investigators believe a wide network of al-Qaida-linked operatives staged the attacks. The family of a Brazilian man killed by police threatened legal action. The network officials are trying to roll up could include bomb makers and those who coached the young suicide attackers before their mission, according to police.
Investigators were also pursuing leads that seemed to indicate a link between the unsuccessful attacks on July 21â when bombs only partially detonatedâ and the suicide bombings two weeks earlier which killed the four bombers and 52 other people.
Metropolitan Police Commissioner Sir Ian Blair said he believed al-Qaida terrorists were involved in both attacks.
“The way in which al-Qaida operates is not a sort of classic cell structure,” Blair told Britain’s Sky News television on Sunday. “It has facilitators, so we’re looking for the bomb makers, we’re looking for the chemists, we’re looking for the financiers, we’re looking for the people who groomed these young people, so it will be a wide network that we’re trying to penetrate.”
Asked if the two attacks were connected, Blair said “we have no proof that they are linked, but clearly there is a pattern here.”
Two men were arrested in London’s southern Stockwell neighborhood on Friday under Britain’s anti-terrorism laws, the Terrorism Act 2000. A third man was arrested under the same legislation in nearby Tulse Hill on Saturday. All three are being held “on suspicion of the commission, instigation or preparation of acts of terrorism” for the unsuccessful, July 21 attacks.
Blair said police were “still anxious for any sighting of the four individuals” whose images were released after being spotted on surveillance camera footage fleeing the scenes of the failed bombings, suggesting that none of the four are among the men now in custody.
Police were reportedly investigating whether some of the July 21 suspects may have visited the same Welsh whitewater rafting center as two of the July 7 suicide bombers: Mohammed Sidique Khan and Shahzad Tanweer.
The two bombers went whitewater rafting there on July 4, according to the National Whitewater Center. Police have refused to comment on reports that a brochure for the rafting center was found in an explosives-laden knapsack that failed to detonate on a bus on July 21.
The fast-moving investigation into the attacks has been marred by the death of a Brazilian electrician, Jean Charles de Menezes, who was shot and killed Friday by police officers who mistook him for a suicide bomber.
Menezes’ family on Monday threatened to take legal action.
“They have to pay for that in many ways, because if they do not, they are going to kill many people,” his cousin, Alex Pereira, told British Broadcasting Corp. television. “They killed my cousin; they could kill anyone.”
Menezes was followed by plainclothes officers after he left an apartment bloc in Tulse Hill that was under surveillance. Wearing a padded jacket, he boarded a bus and traveled to the nearby Stockwell subway station. According to officials, his clothing and behavior aroused the suspicions of the police who ordered him to stop.
Witnesses said Menezes ran into a subway car, where officers shot him. It was unclear why Menezes, who spoke English, did not stop.
Commissioner Blair expressed deep regret for Menezes’ killing, which he described as a “tragedy,” but defended his officers’ right to use deadly force against suspected suicide bombers.
“I am very aware that minority communities are talking about a shoot-to-kill policy; it’s only a shoot-to-kill-in-order-to-protect policy,” he said.
“The only way to deal with this is to shoot to the head ... There is no point in shooting at someone’s chest because that is where the bomb is likely to be.”
In emotionally charged visits, relatives and friends of people killed in the July 7 explosions visited three subway stations, and a central London street where a double-decker bus was blown up, to pay their respects. Many broke down in tears as they laid flowers at the sites of the explosions.
Earlier, more than 230 relatives and friends attended a briefing on the investigation by police.

TITLE: Heavy Earthquake Terrifies Islands With Tsunami Threat
AUTHOR: By Ashok Sharma
PUBLISHER: The Associated Press
TEXT: NEW DELHI — A powerful earthquake hit India’s Nicobar Islands and part of Indonesia, triggering panic in some areas and a tsunami warning in Thailand, but there were no immediate reports of casualties or destruction. 
The magnitude-7.2 earthquake late Sunday night was felt in several parts of the zone struck by the Dec. 26 quake-spawned Indian Ocean tsunami, which killed more than 178,000 people in 11 countries and left nearly 50,000 more missing, with most presumed dead.
Sunday night’s quake jolted people from their sleep in Indonesia’s Aceh province, and prompted residents of at least one coastal village in Sri Lanka to escape to a Buddhist temple on higher ground, fearing killer waves were on the way.
Two moderate aftershocks of magnitude 5.3 and 5.7 hit the Nicobar Islands early Monday just as people there started to return to their homes, said R.S. Dattatrayan, a spokesman for India’s Meteorology Department.
The epicenter of the quake was near the Andaman and Nicobar Islands that lie between India and Thailand, said I.B.A. Rao, a duty officer in New Delhi’s Meteorology Department.
The Hawaii-based Pacific Tsunami Warning Center issued a bulletin saying “earthquakes of this size sometimes generate local tsunami that can be destructive along coasts located within a few hundred [miles] of the epicenter.”
Near the islands, in Thailandâ a country also hit hard by the Dec. 26 tragedyâ authorities issued a tsunami warning for the Indian Ocean. However, it was lifted within hours.
“There is no harm done. But some people are panicking in the Andaman Islands. The sea is very rough. 
Yesterday and today we have witnessed a high tide,” said Rashid Yusuf, president of the Nicobarese Youth Association.
In the Sri Lankan village of Peraliya, where the Dec. 26 tsunami swept a commuter train off its tracks, killing 2,000 peopleâsome residents fled to a Buddhist temple on high ground when first word came via the Internet that there had been an earthquake in Nicobar.
There were few reports of fear or panic in other parts of Sri Lanka, where more than 32,000 people were killed on Dec. 26.

TITLE: North Korea Talks Underway
AUTHOR: By Bo-Mi Lim
PUBLISHER: The Associated Press
TEXT: BEIJING  — U.S. and North Korean negotiators held a rare one-on-one meeting Monday amid a flurry of contacts between delegations to the six-nation talks aimed at persuading the communist nation to relinquish its nuclear program. 
Individual meetings between envoys from the two Koreas, the United States, host China, Japan and Russia took place as the group prepared to resume formal talks Tuesday after a gap of more than a year.
The U.S. and North Korean delegations met behind closed doors at the Diaoyutai State Guesthouse for about an hour and fifteen minutes, the official Xinhua News Agency reported.
The American Embassy did not immediately release details of the meeting, but the U.S. envoy, Assistant Secretary of State Christopher Hill, said earlier the two sides were “just trying to get acquainted, review how we see things coming up and compare notes.”
Referring to Tuesday’s talks, he said: “We are looking forward to working hard and trying to make some progress.” He did not say what progress Washington hopes to make.
Hill said Sunday he didn’t expect the meetings this week to be the last set of negotiations on the Korean nuclear dispute. He said the process is “going to take a lot of work.”
South Korean Deputy Foreign Minister Song Min-soon and his North Korean counterpart, Kim Kye Gwan, met Sunday and “agreed to come up with a framework to realize denuclearization of the Korean Peninsula,” a South Korean Foreign Ministry spokesman said.
The two Koreas agreed to hold bilateral meetings throughout the talks, the South Korean news agency Yonhap reported.
Earlier this month, Seoul offered a new incentive for the North to negotiate — 2 million kilowatts of electricity by 2008 if it agrees to dismantle its nuclear weapons.
The leader of Japan’s delegation, Kenichiro Sasae, called the nuclear issue “central” to talks, but said he would make “utmost efforts” to address North Korea’s past abductions of Japanese citizens, according to Japan’s Kyodo News agency.
The last round of six-nation talks ended in June 2004 without major progress toward a settlement of the dispute.
The conflict erupted in late 2002 when the United States said North Korea had admitted running a nuclear program in violation of an earlier agreement. 
In February, the North claimed it had nuclear weapons. It hasn’t conducted any known nuclear test explosions, but experts believe it has enough weapons-grade plutonium for about a half-dozen bombs.

TITLE: U.S. Makes Final Push for Trade Pact
AUTHOR: By Jim Abrams
PUBLISHER: The Associated Press
TEXT: WASHINGTON — The six countries of the Central American Free Trade Agreement altogether do about as much trade with the United States as The Netherlands. But rarely has a trade deal been more controversial or an administration staked so much on approval. The House is to vote this week on CAFTA, and despite months of intense effort by President Bush and his trade officials, the outcome is unclear. 
The Senate, more amenable to trade agreements, last month approved the pact, signed more than a year ago with Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua and the Dominican Republic.
With some political risk, Bush has put CAFTA near the top of his legislative agenda, meeting personally with dozens of lawmakers, giving speeches around the country, encouraging support from Hispanic groups and venturing into textile country in North Carolina, where there’s little love for free trade agreements.
“This bill is more than a trade bill,” Bush said Thursday in a speech to the Organization of American States. “This bill is a commitment of freedom-loving nations to advance peace and prosperity throughout the Western Hemisphere.”
Also spreading that message are U.S. Trade Representative Rob Portman, Commerce Secretary Carlos Gutierrez and Agriculture Secretary Mike Johanns.
Portman, a former House member from Ohio, has spent almost every day on Capitol Hill since assuming office this spring. He presses his case even with the most adamant anti-CAFTA members and tries to answer concerns over effects on the U.S. sugar and textile industries and labor rights in Central America.
Gutierrez in the past three months has held more than 200 meetings with individual lawmakers, participated in 300 conference calls and conducted 120 media interviews, his office said.
As the vote approaches, there have been warnings that the fragile Central American democracies could slip back into the turmoil of the recent past if denied this economic partnership with the United States.
America’s position as the leader in promoting world stability “could take major steps backward” if CAFTA is defeated, said Rep. Kevin Brady, R-Texas, a leading proponent of the pact. “That’s a pretty compelling argument.”
They also argue that U.S. exports to the region, now about $15 billion annually, would go up because CAFTA eliminates tariffs and other barriers to U.S. products, that U.S. intellectual property would be better protected and American investment would be facilitated. 
They say CAFTA is essential if the United States is to advance a far larger Western Hemisphere free trade accord and other international negotiations to open markets.
And yet, anti-CAFTA passions are intense. House Democratic leader Nancy Pelosi said Thursday that 90 percent to 95 percent of Democrats will vote against it. 
They believe the agreement doesn’t adequately protect worker rights in the impoverished region and previous trade agreements have helped send jobs out of this country.
Democrats and organized labor compare CAFTA to NAFTA, the free trade agreement with Mexico and Canada that many blame for job losses.
To sway the undecided, the administration has promised to close loopholes that might allow China to take advantage of duty-free clothing exports from the region to the United States and to lessen the impact of sugar imports on U.S. sugar beet and cane growers.
“Anything in the right direction on China is probably helpful on CAFTA,” said Rep. Phil English, R-Pa., the sponsor of the China bill who now says he will support CAFTA.  Representative Phil Gingrey, said fifth-generation textile manufacturers in his district are going to have trouble understanding why he now leans toward voting for the bill. 
But he feels his talks with Bush, Portman and others won improvements. “Once they have done everything I asked them to do, I’m not going to up the ante,” he said. 
On the other hand, Representative. Butch Otter, said his talks with Bush and Portman had not dissuaded him that trade deals were bad for the United States. 
Otter said NAFTA, which he voted for, “has been an absolute disaster for Idaho. I’ve probably voted for my last trade agreement.”

TITLE: NASA To Relaunch Space Shuttle Program
AUTHOR: By Mike Schneider
PUBLISHER: The Associated Press
TEXT: CAPE CANAVERAL, Florida — NASA will allow the shuttle Discovery to lift off Tuesday, despite not fully understanding its recent fuel tank failure and as long as the problem resurfaces in the same way it did earlier this month. 
NASA workers have switched the wiring between the problem sensor and another one after the gauge failure forced the space agency to postpone the space shuttle’s launch while astronauts were boarding Discovery on July 13.
NASA’s own launch ruleâ in place since the 1986 Challenger disasterâ requires that all four hydrogen fuel gauges in the external tank be working properly. But NASA will go ahead with the rescheduled launch at 10:39 a.m. Tuesday if the problem doesn’t recur or if it only is found in the two sensors that have been rewired, Wayne Hale, deputy manager of the shuttle program, said at a Sunday evening news conference.
“If the problem recurs ... we’re going to do some more tests just to make sure we understand what is causing this to happen and if we’re comfortable that we have a good understanding, then we can go fly,” Hale said.
NASA Administrator Michael Griffin said he is comfortable with the decision and even hopes the problem recurs to further pinpoint the source of the trouble. He acknowledged that the public might perceive that the space agency is rushing to launch, but insisted it was the right technical judgment.
“It’s not a safety of flight issue,” Griffin said.
Although the focus of NASA’s attention has been on the sensor, rain and clouds may end up causing more concern on launch day. Forecasters put the odds of good launch weather Tuesday at 60 percent. Additionally, the weather at the overseas emergency landing sites is not looking good at all.
“My observation is that when the weather is good, you have vehicle problems. If the vehicle works, you have weather problems,” Hale said. “Since we have some weather concerns, I’m confident the vehicle is going to be OK.”
NASA has just one week to launch Discovery and its crew of seven to the international space station, before putting off the mission until September.
The space agency is insisting on good lighting in order to see any signs of the type of launch damage that crippled Columbia, the last shuttle launch.
Columbia and its seven astronauts were brought down by a broken section of fuel-tank foam insulation that struck just over a minute after liftoff and proved lethal during descent two weeks later, on Feb. 1, 2003.
Workers last week repaired faulty electrical grounding inside Discovery in hopes that would solve the fuel gauge problem that cropped up during the first launch attempt. The same type of problem occurred back in April during a fueling test, and was written off then as an “unexplained anomaly.”
NASA had 14 teams around the country studying the problem. They have eliminated possible explanations one by one, but they have been unable to arrive at a definitive answer.
The fuel gauges are needed to prevent the main engines from shutting down too soon or too late during liftoff, in the event of an extreme problem like a leaking tank. The first scenario could result in a risky, never-attempted emergency landing; the second could cause the engine turbines to rupture and, quite possibly, destroy the spacecraft. Only two fuel gauges are needed to avoid such dangerous situations.
Going with three out of four would result in a “deviation” in the rule, Hale told reporters, but he said NASA engineers’ understanding of the problem is vastly improved compared to 10 days ago.
“I wake up every day and I ask myself, ‘Are we pushing too hard? Are we doing this thoroughly? Have we done the right technical things?’” Hale said.
“I think we’re all still struggling a little bit with the ghost of Columbia and therefore we want to make sure we do it right.”

TITLE: Tour de France Belongs to Lance - 7 Wins
AUTHOR: By Jerome Pugmire
PUBLISHER: The Associated Press
TEXT: PARIS — Lance Armstrong will never ride in the Tour de France again. After seven years of dominance, he is trading in rough rides through the mountains for leisurely days on the beach.
Having stepped onto the podium for the last time on Sunday to celebrate his seventh straight Tour victory, Armstrong will spend a few days ``with a beer, having a blast.’’
It’s time for him to play with his kids, chill out with rocker girlfriend Sheryl Crow, and toast his success as the undisputed champion of cycling’s most demanding event.
“I’m finished,” Armstrong said.
He is moving far away from the awe-struck crowds that crossed countries for the merest glimpse, the six-hour training rides in pouring rain that gave him the edge over others, the stress of worrying whether his rivals could ever catch up.
Armstrong is now retired at the ripe old age of 33.
“We’re just going to hang out in the south of France for a little while and do nothing,’’ Crow said.
Armstrong loved the mystique that surrounds the 102-year-old Tour, and is proud to see his name listed above five-time champions Jacques Anquetil, Eddy Merckx, Bernard Hinault and Miguel Indurain.
He hated the accusations that his success was based on anything other than a desire to push himself further than any other cyclist. He had an intense dedication to training and meticulous planning, and an ability to bring the best out of teammates.
“This is the most difficult event there is,’’ Armstrong told French television. “I won it once, twice, three, four, five, six, and seven times, so of course they ask those questions. When you don’t answer it as they like, they make up the answer for you.’’
Armstrong planned to escape to a resort near the French city of Nice on Monday.
After his final win, Armstrong set his sights on a Sunday night with friends, his mother, his three children, numerous sponsors, and teammates at a big bash at Paris’ Ritz Hotel. He even invited longtime rival Jan Ullrich, the 1997 Tour winner and five-time runner-up — three to Armstrong.
Ullrich finished third this year, right behind Italy’s Ivan Basso.
Armstrong will be back on the Tour next year, as adviser to close friend Johan Bruyneel, the Discovery Channel team director.
“I have a special place in my heart for this race,” he said. “I dream about coming back to France, telling stories to my children. I really care about it.”
Armstrong won the 23-day race comfortably, again.
He finished 4 minutes and 40 seconds ahead of Basso and 6:21 clear of Ullrich, who has finished off the podium only once since placing second during his debut in 1996. Ullrich struggled into a fourth-place finish last year.
Armstrong praised the two riders, who could fight to succeed him as champion next year.
“To end a career with this podium is really a dream,” Armstrong said.
He hugged Ullrich, the powerful German rider who pushed him so close to defeat two years ago. Armstrong’s winning margin in 2003 was 61 seconds, his smallest ever.
“What he did was sensational,” Ullrich said. “It is his seventh victory. He deserved it.”
Emotion flowed when Armstrong took the podium one last time, hand over heart, “The Star-Spangled Banner” ringing out over the Champs-Elysees.
Behind her dark glasses, Crow fought back tears — as Armstrong had done Saturday when he won the Saint—Etienne time trial to clinch the final stage win of his illustrious career.
“It’s a great story and to see it coming to a close for me, and I’m sure for a lot of other people, it’s a very emotional experience,” Crow said.
He led his three children up the podium steps. His 3-year-old twin daughters, Grace and Isabelle, wore yellow dresses and stood by their 5-year-old brother Luke.
“Vive le Tour, forever,” Armstrong said in his parting speech, arms raised in the air one final time.
He also delivered a final shot at “the people who don’t believe in cycling, the cynics and the skeptics” who suspect that doping is rife in the grueling sport and fueled his dominance.
“I’m sorry for you. I’m sorry you don’t believe in miracles. But this is a hell of a race,” he said. “You should believe in these athletes, and you should believe in these people. I’ll be a fan of the Tour de France for as long as I live. And there are no secrets — this is a hard sporting event and hard work wins it.”
Armstrong’s all-encompassing approach to cycling modernized a sport steeped in tradition. Rivals fell behind as they failed to match his preparation.