SOURCE: The St. Petersburg Times
DATE: Issue #1154 (20), Tuesday, March 21, 2006
**************************************************************************


TITLE: Zenit Vows To Educate Racist Fans
AUTHOR: By Martin Burlund
PUBLISHER: Special to The St. Petersburg Times
TEXT: The Brazilian captain of a visiting soccer team was greeted by monkey noises made by St. Petersburg fans as he raised the Russian flag to mark the first game of the 2006/07 domestic football season at Petrovsky Stadium on Sunday. 
As Antonio Geder, captain of Saturn Moscow, approached the flagpole with FC Zenit St. Petersburg captain Vladislav Radimov to take part in the ceremony, Zenit fans seated nearby made monkey calls in a menacing and unmistakable reference to the color of  Geder’s skin.
The player was subject to further racist taunts throughout the match, which ended in a 1:1 draw.
World soccer organisation FIFA has recently issued a statement asking coaches to contribute to the battle against racism. 
But after the game, Saturn coach Vladimir Weiss expressed a sanguine view on the monkey impersonations.
“I can understand the Zenit supporters — they want to support their players,” he said.
However, Zenit coach Vlastimil Petrzela took a stronger line.
“I don’t like this at all,” he said, and pointed out that European leagues with this kind of fan behavior may miss out on talented football players from the African continent if such abuse is not stopped.
Zenit’s communications director Fyodor Pogorelov reiterated Monday that Zenit will not tolerate racism in the stands.
“FC Zenit’s official attitude concerning racism is that it’s definitely wrong, unacceptable and impossible,” Pogorelov said.
Last Tuesday FIFA issued plans to punish acts of racism with penalties including deductions of points and disqualification from competitions. The plan also talks of banning fans from stadiums if they show racist behavior.
“You must do everything you can to ban these people from stadiums,” France and Juventus defender Lilian Thuram told French sports daily L’Equipe. 
“I strongly believe in education but there are some people who can’t be educated any more. It’s too late.”
The proposals by FIFA were agreed in Zurich on Thursday in a meeting at which Thuram gave testimony about racism in football, describing it as a “plague.”
Confederations and national associations will be compelled to incorporate the measures and infringements could lead to a two-year exclusion from international football, said FIFA. 
“Financial sanctions have no effect — stripping a club of points can be more discouraging. If you miss a title or if you are relegated because of the behaviour of your fans, it can be pretty effective,” Thuram said.
Zenit spokesman Pogorelov said that the St. Petersburg club supports tough anti-racist measures against fans.
“We think that a good idea is to identify certain ‘misbehavers’ and ban them from the stadium,” he said.
Hard penalty measures were discussed after Spanish team Zaragoza’s fans racially abused Barcelona’s Samuel Eto’o at a league game last month. The Cameroonian player threatened to leave the pitch in protest until he was persuaded by teammates to continue playing.
Zaragoza, which has pledged to lead the way in combating racism in stadiums after last month’s incident, said it was against FIFA’s plans.
“Combating racism is all about education. I don’t think sporting measures will solve anything,” Zaragoza club director, Jeronimo Suarez told sports daily Marca.
Zaragoza was fined 9,000 euros ($10,960) by the Spanish Football Federation for the behavior of its fans.
A FIFA conference in Barcelona  held in the wake of the Eto’o incident called on players and coaches to make their contribution to the battle against racism in football. 
Zenit coach Petrzela said he didn’t need to be spurred by recent developments to talk to his players about promoting tolerance.
“Our players don’t support racism at all. I do not have to tell them anything special about [racism],” he said.
Geder was not available for comment on Monday. 
But Cameroonian defender Jerry Christian Tschuisse, who has played for Russian sides Spartak Moscow and Chernomorets FC, once told the BBC that he had seen the ugly face of Russian football.
“I’ve had bananas thrown at me on the pitch,” he said. “People shouting at me: ‘Oi, black guy, what are you doing here?’ And there have been fights, too.”
Pogorelov said that while such behavior is all too common in Russian stadiums, Zenit is planning to promote racial awareness among its fans with a project now being planned with City Hall.

TITLE: All-Star Cast Shoots Second World War Epic
AUTHOR: By Galina Stolyarova
PUBLISHER: Staff Writer
TEXT: John Malkovich is playing a gruesome NKVD colonel in a new British-Russian film currently being shot by Thema Production at a glue factory in the St. Petersburg suburb of Pushkin.
Set in 1946, “In Transit” is based on real events that took place in Pushkin. A group of German prisoners of war is by accident sent to and held in a transit camp guarded by women immediately after the end of the Second World War. The location being used for the shoot is the “Krasny Treugolnik” (Red Triangle) factory in the south of the city.
According to the filmmakers, during the year that the prisoners spend in the camp, they experience a tremendous range of human feelings, from humiliation and hatred to despair, love and forgiveness.
Headquartered in Luxembourg, Thema Production has offices in London and St. Petersburg. Since its launch in 2003, the company has co-produced 12 films, including Woody Allen’s Oscar and Golden Globe-nominated “Match Point,” starring Scarlett Johansson.
“In Transit” is the first fiction film to come from documentary guru Tom Roberts, who gained international fame for his documentaries about Chernobyl, the military campaign in Chechnya, the legacy of the Soviet Gulags and the war in Iraq.
“This is a story of forgiveness and the triumph of the human spirit,” said the film’s producer Mikhail Dunayev. “I think it is very relevant today as it shows us that war is not a solution to conflict.”
For many war veterans in Russia, coming to terms with memories of the Second World War has been difficult. In St. Petersburg, recent attempts to hold exhibitions of war photographs and memorabilia collected by both German and Russian survivors have met with protests from local veteran organizations.
“When the world celebrated the 60th anniversary of the end of World War II, the Germans offered to restore a war cemetery for the Russian government,” Dunayev said. “There was only one condition, that it would be a memorial to all soldiers; everyone was to be equally honored. The Russians didn’t support this initiative, and this means they haven’t forgiven.”
At least one actress in the team has first-hand family experience of this lack of forgiveness.
From her early childhood, Vera Farmiga remembers the ice-cold tone and pursed lips of her Ukrainian grandmother when she talked about the war. Farmiga’s grandmother was a nurse in a camp during World War II.
“Even as a child I was shocked to see and sense that she could not forgive,” Farmiga said at a press conference in the Rosbalt news agency on Thursday. 
“It baffled me so much, and I wondered why it is that some people find it harder to forgive than others. For me, reading the script brought these memories back.”
The main character, a former university professor, Max, is played by German actor Thomas Kretschmann. Max is confronted by Malkovich’s character, Colonel Pavlov, a vicious torturer and champion of sadism.
“I play an NKVD colonel, and there is, in fact, a personal twist on this story for me,” Malkovich said. “I have German ancestry, my wife has Jewish ancestors and comes from St. Petersburg. I have been in your city on several occasions and I relate to this place in many respects.”
The cast also includes German actor Daniel Bruehl, Lithuanian star Ingeborga Dapkunaite and an American actress of Ukrainian descent, Vera Farmiga. 
Dapkunaite’s character in the film, Chief Guard Vera Tyurina, is openly vindictive toward the German captives. Tyurina’s nickname, “devil in a skirt” is well-earned, Dapkunaite believes. “Although the war is over, for Vera, the campaign, the vendetta is only beginning,” Dapkunaite said. “My character is by no means a kind person.”
Yevgeny Mironov plays a gloomy, shell-shocked and introverted camp guard in Roberts’ film. 
Mironov’s role is virtually silent: his character, lost in thought, barely acknowledges the presence of his own wife, prison doctor Natasha. “Goodbye, Natasha!” is, in fact, the only phrase the actor is to pronounce in the entire film.
“Tom Roberts offered me a choice of two roles, and I preferred the guard’s role as it’s very unorthodox,” Mironov said. 
“I need to use mime and the language of gesture a lot, which is a lot more challenging. There is even an element of clowning in performing this role.”
The shooting in St. Petersburg, which started on March 1, is due to finish in early April.
The film is scheduled to be completed by the end of the year and is expected to have its world premiere at the prestigious Berlinale International Film Festival in Berlin in February 2007.

TITLE: New Customs Rules Threaten Finnish Trade
AUTHOR: By Evgenia Ivanova
PUBLISHER: Staff Writer
TEXT: Russia’s new customs regulations may significantly affect trade between Russia and Finland, as well as decrease tourist flows by 50 percent, warned Finnish experts. 
The legislation of January 23, as posted on the tamognia.ru web portal , states that Russian travelers are allowed to bring only 35 kilos of duty free goods into Russia, as opposed to the previous limit of 50 kilos. 
The regularity of such visits has also been limited. Since the law came into force in February, Russian travelers can only engage in duty free shopping once a month. 
The total number of visits by travelers from Russia may be almost halved as three out of every four Russians visiting Finland are either going there to shop or on business or for private purposes,” Pasi Nurkka, managing director of the TAK Finnish research center, said Friday in an emailed statement.
According to Nurkka, Russians spent 400 million euros ($486 million) in Finland last year, but trade between Russia and Finland could be reduced by as much as 40 percent as a result of the new customs rules.
Nurkka said that the customs authorities could be lax in enforcing the new rules, meaning that the reduction in trade would “not be as bad” as expected.
St. Petersburg resident Natalia Esaiashvili, who returned from her regular shopping trip to Finland observed, the same practice.
“At the moment, the customs officials don’t have any mechanism for checking how many shopping trips a certain tourist has already made,” she told The St. Petersburg Times on Monday.
“But I can confirm that the situation is very upsetting for Finnish businesses, especially those situated close to the Russian boarder,” Esaiashvili said.
“In towns like Lappeenranta, retail outlets are highly dependant on so-called ‘shuttle traders,’ with many shops catering for Russians specifically, so obviously the new law might hit them hard,” she said.
Pirkko Perheentupa, marketing group director at the Helsinki-based Finnish Tourist Board, confirmed that the majority of Russian tourists shop whilst in Finland, but said it wasn’t their prime purpose for visiting and, as a result, her organisation didn’t expect any fall in tourist numbers from Russia.
“They are not visiting Finland with the sole aim of shopping here. There are plenty of other reasons to choose Finland as a destination for traveling,” Perheentupa said. 
Arto Asikainen, of the Finnish Tourist Board’s Moscow branch, admiited that many Russians do go to Finland merely to shop. 
As quoted by Helsingin Sanomat, the largest Finnish daily, he said the new law could drastically reduce the number of such trips.
The newspaper also reported that  “the changes appear to have already made a difference at the border.”
“While the number of trips suggested an increase of 15 percent during the first weeks of the current year, it fell last week compared with the corresponding period in 2005,” the newspaper reported on March 14.
Nevertheless, Kirsi Lyytikainen, PR officer at Vaalimaa Customs, the primary customs point on the border between the EU and Russia, said that so far, there has been no observable difference in the number of travelers from Russia.
Lyytikainen said in a telephone interview on Monday that it remains too early for the statistics to reveal any real fall in the number of visitors to Finland from Russia.

TITLE: Kremlin Reclaims Soviet Role
AUTHOR: By Henry Meyer
PUBLISHER: The Associated Press
TEXT: MOSCOW — The Kremlin may be reclaiming a dominant role in its former Soviet backyard. 
In Belarus, Moscow-allied strongman Alexander Lukashenko just won by a landslide — at least by the official count. And President Vladimir Putin’s allies could return to government in next Sunday’s Ukrainian parliamentary poll a year after the Orange Revolution. 
Such developments set back Western hopes of a democratic tidal wave in the former Soviet sphere and could further tarnish Putin’s democratic credentials as he tries to cast himself as a statesman capable of brokering deals with Iran and Hamas. 
For Putin, however, asserting dominance over Belarus and Ukraine appears to be part of his strategy to re-establish Moscow as a global player in his year of G8 presidency. 
“Russia wants to restore its superpower status, and that includes putting these countries back into its orbit,” said Yevgeny Volk, Moscow director of the conservative U.S think tank Heritage Foundation. 
“It is seeking to reclaim its influence all over the former Soviet Union, and remove that of the United States and European Union,” he added. 
Russia was furious at what it saw as Western encroachment on its home turf after Ukraine’s 2004 Orange Revolution — the mass protests over election fraud that brought reformist opposition leader Viktor Yushchenko to power over the Kremlin’s favored candidate, Viktor Yanukovych. 
Months later, the impoverished Central Asian nation of Kyrgyzstan had its Tulip Revolution, becoming the third former Soviet state within 18 months to see opposition forces topple a Soviet-era leader. Georgia’s Rose Revolution started the process in 2003. 
Today, however, Russia is once again on the rise as nervous authoritarian regimes from Kazakhstan to Uzbekistan — where rights groups say government troops killed hundreds of civilians in a crackdown on protesters last year — build closer ties to Moscow, partly as a way to cow opposition forces. 
Even in Ukraine, disillusionment at political infighting and the economic collapse that followed the Orange Revolution have brought about a political comeback for Yanukovych, whose rigged victory in the 2004 presidential election was annulled by the Supreme Court. 
Enjoying strong support in the Russian-speaking east, his party is poised to win the most seats in the new parliament and earn the right to form the government, even if it will probably need to govern in an uneasy coalition with the party of the pro-Western Yushchenko. 
“The West’s influence that triumphed in the color revolutions has clearly turned into a dead end for these nations,” said Sergei Markov, a Kremlin-connected political analyst. “In Georgia, Ukraine and Kyrgyzstan, people live much worse, not better than before.” 
In contrast, Belarus, whose authoritarian leader Lukashenko is shunned by Western nations that denounce him as Europe’s last dictator, cheap supplies of Russian gas provide a vital lifeline to the inefficient, state-dominated economy. 
Analyst Alexei Malashenko of the Carnegie Moscow Center think tank said on Ekho Moskvy radio that while the Kremlin sometimes had tense relations with Belarus, its greatest interest lay in preserving the status quo in Minsk. 
He also said that despite loud Western criticism of the Belarus election, there was no serious attempt to help pro-democratic forces like in Ukraine. 
“There was a strong fight for Ukraine, but no one fought for Belarus,” Malashenko said. 
Analysts agree that Russia’s trump card in the region is to be found in its immense energy resources. 
They ensure that despite their pro-Western inclinations and desires for independence, both Georgia and Ukraine remain dangerously dependent on their larger neighbor.

TITLE: Bank Accounts Frozen At Open Russia Charity
AUTHOR: By Maria Levitov and Nabi Abdullaev
PUBLISHER: Staff Writer
TEXT: MOSCOW — Authorities on Friday froze the bank accounts of Open Russia, the philanthropic foundation headed by jailed Yukos founder Mikhail Khodorkovsky.
Judge Olga Solopova of Moscow’s Basmanny District Court — the same court that convicted Khodorkovsky on fraud and tax evasion charges in May — signed an order freezing the accounts, and an official from the Prosecutor General’s Office delivered the order to Trust National Bank, which is controlled by Yukos’ parent company, Bank Menatep, bank vice president Dmitry Chuksiyev said.
Chuksiyev said the reason given in the order was the criminal proceedings against Khodorkovsky and other people connected to Group Menatep.
Open Russia said it had about $6 million in the accounts and called the court action a last attempt to smear Khodorkovsky’s reputation.
“This is the final act of the drama,” Irina Yasina, deputy head of the foundation’s board, said by telephone Sunday. “Open Russia was all that remained that reminded people of his activities and former status. Now, he is just a prisoner.”
Open Russia received no notice that the accounts had been frozen and found out only when its financial managers noticed that money transfers had stalled, spokeswoman Irina Savchenko said.
The Prosecutor General’s Office declined to comment.
Khodorkovsky, who remains Open Russia’s chairman, is serving an eight-year prison sentence in a prison in the Chita region, near China.
Open Russia, which was established in 2001, spent about $11 million last year on dozens of educational, social and civil rights projects, Savchenko said. The funds in Trust were earmarked for similar projects by 47 regional and eight national partner nongovernmental organizations in 48 regions this year, Savchenko said.
A contentious NGO law that goes into effect next month will bar people convicted of crimes from creating and heading NGOs.
Meanwhile, Khodorkovsky on Friday was placed in a punishment cell for seven days for drinking tea in the wrong place, according to a statement on his web site.

TITLE: Space Station Awaits Brazilian
PUBLISHER: The Associated Press
TEXT: MOSCOW — The Russian-U.S. crew manning the international space station on Monday maneuvered a capsule into a new dock to make way for the new team’s arrival next week. 
The 30-minute operation required the crew to bring the capsule 100-150 feet back from the station and manually guide it into a new parking spot, Russian Mission Control spokesman Valery Lyndin said. 
A Soyuz capsule carrying a Russian, an American and Brazil’s first astronaut is scheduled to lift off from the Baikonur cosmodrome in Kazakhstan on March 30 and arrive at the station two days later.

TITLE: IN BRIEF
TEXT: Students Attacked 
ST. PETERSBURG (AP) — A group of football fans attacked foreign students at a St. Petersburg metro station after mistaking them for supporters of a visiting French team, police said. 
About 15 fans of the Zenit club started the brawl outside the station late Thursday after their team scored a 1-1 draw against Marseille.
The students, who were from Israel, Pakistan and Jordan, sustained only light injuries.

Chechen Trial in Paris
PARIS (AP) — Four members of a family, including the mother and father, are among 26 people to go on trial Monday for their suspected roles in helping Islamic militants in Chechnya and possibly planning an attack in France. 
One of the main defendants, Menad Benchellali, an alleged chemicals expert for the group, has signaled his unwillingness to appear in a Paris court. Deciding whether he must be present will be one of the first tasks of Presiding Judge Jacqueline Rebeyrotte during the trial, expected to run until May 12. 

Transdnestr Criticized
CHISINAU, Moldova — The U.S. Embassy criticized pro-Russian separatists who control Moldova’s Transdnestr region for banning foreign financing for NGOs, saying the measure violates international norms. 
Foreign espionage was cited by Transdnestr leader Igor Smirnov as the reason for the ban.

TITLE: Justice Minister Slams Abuse
AUTHOR: By Carl Schreck
PUBLISHER: Staff Writer
TEXT: MOSCOW — Justice Minister Yury Chaika on Friday assailed an increase in human rights violations in prisons and promised measures to limit the activities of missionaries.
Chaika reeled off a list of statistics at a Justice Ministry meeting attended by President Vladimir Putin, saying that the number of prison officials charged with abuse of power grew by 87 percent last year, while the crime rate among prisoners increased 24 percent.
“The number of murders increased by 11 percent, and incidents of serious assault rose by 42 percent,” Chaika said, adding that jailbreaks also increased.
Chaika blamed the worsening human rights situation on the increased autonomy of the Federal Prison Service, which, after becoming an official state service under the auspices of the Justice Ministry last year, has broken away from the “coordination and control of the ministry,” he said.
Putin called prison conditions “one of the most sensitive” problems facing the penal system. “Despite some positive developments, in many of the detention facilities where suspects are being held living conditions are far from acceptable,” Putin added.
Chaika’s criticism could stem from a behind-the-scenes battle for control between the Justice Ministry and the Federal Prison Service, Valery Abramkin, head of the Moscow Center for Prison Reform, said by telephone. He said the statistics would have to be analyzed more closely before they could be deemed indicative of any specific trends.
“If there was an 87 percent rise in cases of abuse by prison officials, it could just mean they are doing a better job of registering such crimes,” he said.
In addition to addressing the penal system, Chaika said the Justice Ministry planned to introduce legislation later this year that would tighten control over religious organizations conducting missionary work, though he did not specify any particular organizations.
“Recently, we have been disturbed by illegal missionary activity,” Chaika said. 
“As our analysis has shown, there is not only nothing in our legislation regulating this issue, there is not even a definition of ‘missionary activity.”
Asked whether Chaika was referring to any specific religious groups, Justice Ministry spokeswoman Tatyana Chernyshova said she could not give any details because the ministry had not yet begun drafting the legislation.

TITLE: Locals Remain Ignorant Of Rights as Consumers
AUTHOR: By Yevgenya Ivanova
PUBLISHER: Staff Writer
TEXT: With World Consumer Rights’ Day being celebrated last week, RosPotrebNadzor — the federal service for the protection of consumer rights — and numerous watchdogs expressed doubts about the quality and safety of goods being offered on the local market.
At a press conference held last week, the service revealed that it had found legal violations at 81 percent of the businesses it inspected in 2005, with the volume of products being withdrawn rising over the same figure for 2004. Over half of all wines offered on the St. Petersburg market in 2005 were withdrawn as a result of the intervention of the state watchdog service. 
“Unfortunately, we have to admit that these figures are accurate, although they’re also quite stable,” said Alexander Meltser, deputy head of the St. Petersburg branch of RosPotrebNadzor, speaking at the press conference. 
Experts speaking at the press conference said that consumers remain ignorant of their rights.
“People are simply not aware of the latest developments in the field of consumer rights,” said Anatoly Golov, co-chairman of the Consumers’ Union of Russia. 
Golov said that a hotline sponsored by the City Government could significantly improve the situation.
“If the city would go back to financing the distribution of elementary legal information, the situation could change dramatically,” Golov said. 
“Almost all questions [in the field of consumer rights] can be easily resolved, but consumers feel it’s difficult for them to get the necessary information about the ways this can be done,” Golov said.

TITLE: Synagogue Attacker Faces 16-Year Jail Term
PUBLISHER: The Associated Press
TEXT: MOSCOW — Prosecutors called Monday for a 16-year prison sentence and mandatory psychiatric treatment for the young man accused of attacking worshippers in a Moscow synagogue, Russian news agencies reported. 
Alexander Koptsev, 20, allegedly stabbed and wounded nine men in January with a hunting knife inscribed with the saying, “Happy fishing, successful hunting.” 
He has been charged with attempted murder, assault and actions aimed at humiliating ethnic or religious groups. 
“In his testimony, the accused has practically confirmed the testimony given during the preliminary investigation: that the attack on the synagogue was planned and premeditated,” the ITAR-Tass news agency quoted Moscow prosecutor Kira Gudim as telling the Moscow City Court on Monday. 
Prosecutors say Koptsev was acting alone and that he does not belong to any extremist group. He was judged sane at the time of the attack, but a chronic schizophrenic condition had an impact on his actions, ITAR-Tass quoted the results of a medical examination as determining. 
A million Jews live in Russia, according to the Federation of Jewish Communities, and the Jewish community is now experiencing a revival after a wave of emigration to Israel and other countries. 
Rising xenophobia in recent years has seen hundreds of racially motivated attacks on targets including dark-skinned immigrants from former Soviet Central Asia and the Caucasus region. 
Rights activists say hate groups are emboldened by authorities’ mild approach to prosecuting hate crimes, and complain that literature from Nazis and other extremists is sold freely.

TITLE: Putin to Tackle Energy on China Visit
AUTHOR: By Richard McGregor and Andrew Yeh in Beijing
TEXT: FT
BEIJING — President Vladimir Putin arrives in China on Tuesday for a visit that Beijing hopes will secure it a decisive advantage over Japan in their lengthy battle to secure the route of an oil pipeline from east Siberia.
Despite booming bilateral trade which reached $29.1bln in 2005, up 37 percent year-on-year, an energy-hungry China has been increasingly frustrated by Russia’s prevarication over various oil and gas deals.
Beijing was angered when Moscow abrogated a 2003 agreement to build a pipeline to Daqing, China’s oil capital in the north-east, after Tokyo offered a more attractive financial package to re-route it to a Russian port.
Although the Daqing route is shorter and cheaper, the Japanese proposal gave Russia more options to market the oil throughout north Asia and ensure it did not become totally dependent on China.
However, the pendulum may be swinging back Beijing’s way, with China National Petroleum Corp, the country’s largest energy company, expected to sign an investment agreement during Putin’s two-day trip with Transneft, Russia’s oil pipeline monopoly.
“We are full of confidence that the branch pipeline will be built,” said Chen Gang, the CNPC chairman, in an interview with the Russian media before the visit.
One possible compromise that has been discussed would see the pipeline go through Daqing to the Chinese port of Dalian, from where the oil could be shipped to South Korea or Japan.
The absence of any pipeline between the two countries means that Russian oil imports, which account for about 5 percent of China’s total foreign purchases, have to come in on an overloaded rail system.
Sergei Razov, Russia’s ambassador to Beijing, said in comments before the visit that “energy cooperation was progressing smoothly” and that the pipeline project was being negotiated.
“It’s a large-scale project of great vision that requires a high level of investment,” he said in a pointed reference to Russia’s demand that China pay for most of the project’s construction cost.
Razov said Putin’s visit takes place when Sino-Russian relations were at  “their best time in history.”
However, many Chinese officials and commentators are critical about how the warmth in ties between Putin and Hu Jintao, China’s president, and other top leaders, have not translated into concrete co-operation.
The Chinese media has characterised the relationship as “hot on the top but cold on the bottom.”
“The impetus that improves bilateral relations appears weak due to a lack of communication and understanding and even a misunderstanding between people of the two countries,” said the Oriental Morning Post newspaper in Shanghai.
The two sides may also discuss possible gas sales by Russia, but such talks are not expected to progress very far as long as energy regulations in China keep the domestic price lower than the international price, making any such imports uneconomic.

TITLE: Hotel Project to Renovate 19th Century Warehouses
AUTHOR: Yekaterina Dranitsyna
PUBLISHER: Staff Writer
TEXT: Developers have announced the restoration of 19th century warehouses as part of the construction of a new four-star SPA-hotel in the city center.
The former vine warehouses were built by the Yeliseyev merchants at the spit of Vasiliyevsky island. By 2007 the old structures will be the setting for a hotel with a pool, several saunas, fitness center and sports-bar, as well as restaurants and conference halls, one of the project’s developers, Etalon-LenSpetsSMU construction company, said Friday in a statement.
Located between Birzhevoi and Volkhovsky streets, the seven-storey complex, designed by the Yevgeny Gerasimov architectural studio, will have 280 rooms and a total area of over 25,000 sq. meters. 
At the beginning of March Etalon-LenSpetsSMU signed an agreement with a consortium of foreign companies to realize the project, the company said. The project requires 50 million euros ($60 million) worth of investment. 
The hotel will be owned by London & Regional Properties — one of the largest private property companies in Europe, owning 61 hotels — and operated by the Finnish company Holiday Club. 
Although tourists are most interested in 3-star hotels, a major part of investment is made in the 4-star segment, said Dmitry Zolin, director for development at London Consulting & Management Company. 
According to LCMC, 22 new hotels were constructed last year in St. Petersburg including six of the 4-star variety. According to the committee for investment and strategic projects, at the moment 16 hotels rated 4 stars are based in St. Petersburg comprising 3,280 rooms.
“At the moment the hotel business in the city is characterized by low levels of competitiveness and extremely high prices in the 4-star and 5-star bracket,” said a report published by Boston Consulting Group last year.
According to BCG, prices for 3-star and 4-star hotels in St. Petersburg are 20 percent to 30 percent higher than in other European cities, partly because of a longer pay-back period compared to residential and commercial real estate projects and large investments as well as the numerous approvals required to complete a project.
“The pay-back period for a four-star hotel is seven to eight years. Profitability is comparable to investment into a B-class business center, but the pay-back period is one to two years longer,” Zolin of LCMC said.
Zolin predicted problems over the long-term. “With the G8 meeting in St. Petersburg this summer all new 4-star hotels will be occupied, but the general slowdown in the tourism market could affect the pay-back period of such projects,” Zolin said.
Igor Luchkov, head of assessment and analysis department at Becar, indicated the hotel’s “unique” location as the project’s main selling point but  said that in the future the number of such projects would be limited by the shrinking market and a lack of space.

TITLE: IN BRIEF
TEXT: Budge Colliery
LONDON (Bloomberg) — Richard Budge, the former chief executive of RJB Mining known as “King Coal,” plans to open a 800 million pound ($1.41 billion) clean coal power plant in South Yorkshire with financing from Russia’s Kuzbassrazrezugol, The Independent reported, citing Budge.
Kuzbassrazrezugol, one of Russia’s largest coal producers, probably paid 29 million pounds ($50 million) for 51 percent of Powerfuel, set up by Budge to run the site near Doncaster, the newspaper said.
Powerfuel will refurbish the colliery and expects to restart mining next year.

Industrial Slowdown 
MOSCOW (Bloomberg) — Russian industrial production rose 0.7 percent in February from January, almost six times slower than in the same month a year ago, because oil and gas output declined.
Annual output, reported Monday by the Federal Statistics Service, rose 1 percent in February, compared with a 4.1 percent increase in February 2004, Federal Statistics Service said in an e-mailed statement Monday. The growth was slower than the 4.5 percent median estimate of 15 economists surveyed by Bloomberg.
The government expects Urals crude, Russia’s major export commodity, will average at least $54 a barrel in 2006, compared with $40 initially planned and about $10 a barrel it traded in 1998. 

MTS Mulls Takeovers
MOSCOW (Bloomberg) — Mobile TeleSystems, eastern Europe’s largest mobile-phone company, will spend between $7 billion and $10 billion on acquisitions outside Russia, Vedomosti said, citing the company’s chief executive officer.
The spending spree, most of which may be completed by the end of 2008, should allow Mobile TeleSystems to enter the world’s top 10 mobile phone operators in 2010, Vedomosti reported, citing CEO Vasily Sidorov.
Mobile TeleSystems aims to have more than 100 million subscribers by then, Vedomosti reported. The most interesting markets include the Middle East, South-East Asia, and southern and south-eastern Europe, Sidorov told the Moscow-based daily newspaper. The company plans to invest about $1.9 billion this year on its networks, of which $1.3 billion will be spent in Russia, the newspaper said.

Yukos Rebels 
MOSCOW (Bloomberg) — Yukos Oil Company’s Moscow office has two rival boards of directors after managers rebelled against the companys London-based executives, Kommersant reported, citing unnamed sources.
The board, at a meeting in Vienna on March 15, fired Anatoly Nazarov, the head of Yukos’s Moscow office, for disloyalty to the company’s chief executive officer, Steven Theede, the newspaper reported. A rival board meeting, which convened the next day in Samara, reinstated Nazarov, Kommersant said.
Both meetings were legitimate in a legal sense, the newspaper said.
Yukos, once Russia’s biggest oil exporter, is struggling to survive after the government claimed $28 billion in back taxes. The company faces a bankruptcy hearing in a Moscow court next week.

Rosneft Investment  
MOSCOW (Bloomberg) — Rosneft, Russia’s state oil company, will spend at least $1 billion developing oil and gas fields in eastern Siberia, RIA Novosti reported, citing Rosneft Chief Executive Officer Sergei Bogdanchikov.
Bogdanchikov was speaking during a weekend trip to Russia’s energy-rich island of Sakhalin, where Rosneft is participating in the Sakhalin-1 project, the state-run news service reported.
RIA didn’t provide any more information about Rosneft’s plans for eastern Siberia.

Chechnya Control 
GROZNY, Chechnya (Bloomberg) — Chechnya, a Russian province ravaged by a separatist war, asked the federal government in Moscow to give it control of the local oil and gas company, Interfax reported.
The pro-Moscow Chechen government wants the Russian state to transfer a 2 percent stake in Gronzneftegaz, a unit of Rosneft, to get a controlling stake of 51 percent, Interfax reported on March 18 from Grozny, the Chechen capital.
Dukvakha Abdurakhmanov, chairman of the Chechen parliament, said that Rosneft, Russia’s state-owned oil company, earns more than 17 billion rubles ($610 million) from the sale of Chechen oil and that only 30 million rubles flowed back to Chechnya, Interfax said.

Abramovich Stake 
MOSCOW (Bloomberg) — Russian billionaire Roman Abramovich has held talks with the owners of Evraz Group SA, Russia’s biggest steelmaker, about buying a stake in the company, Vedomosti said, citing unidentified bankers and industry executives.
Evraz’s owners, led by billionaire Alexander Abramov, may be willing to sell 25 percent plus one share of the company, enough to block some corporate decisions, the Russian newspaper reported. Nobody at Evraz could be reached to comment immediately when Bloomberg called the company’s Moscow offices Monday.

Svyazinvest Profit
MOSCOW (Bloomberg) — Svyazinvest, Russia’s national landline telephone operator, said profit soared 59 percent last year to 27.6 billion rubles ($1 billion) as the company revalued the assets of its Moscow unit, MGTS.
Sales advanced 14 percent to 211 billion rubles in results conforming to Russian accounting standards, Chief Executive Officer Valery Yashin told reporters in Moscow on Monday. 
Costs rose 14 percent to 160.4 billion rubles.
State-run Svyazinvest’s 2006 profit will probably rise 58 percent to 43.7 billion rubles on revenue of 216.4 billion rubles, Yashin said.

Coal Delivery
MOSCOW (Bloomberg) — Russian Railways, Russia’s rail monopoly, suspended coal deliveries to the Pacific port of Vostochny for five days to clear storage after traders Glencore AG and Krutrade AG didn’t time train arrivals with ship loading.
“The companies are holding in Vostochny’s storage area two times the normal amount of coal, not giving the other shippers the opportunity to unload,’’ said a statement posted Monday on Moscow-based Russian Railways’ web site.
Russian Railways said 5,645 wagons carrying coal to the ports of Vostochny and Posyet are delayed and that another 3,500 wagons moving toward the outlets may be caught in the traffic jam.
Russia, the world’s fourth-largest coal exporter, faces loading disruptions in ports because of storms and cold weather during the country’s winter.

Mechel Stake 
MOSCOW (Bloomberg) — Mechel, the Russian metals and mining group, said Chairman Igor Zyuzin raised his stake in the company to 47.1 percent from 42.2 percent as part of a transaction that doubled the number of freely traded Mechel shares.
The company’s so-called free float increased to 23 percent of all shares outstanding, Moscow-based Mechel said in an e-mailed statement Monday.
Chief Executive Officer Vladimir Yorich is leaving Mechel six years after creating it with Zyuzin. Yorich said last month he would sell his 42.3 percent stake to Zyuzin, who said he will retain at least 51 percent of the company and sell the rest of the stock he buys from Yorich on the open market.

VimpelCom Backed
FOMEBU, Norway (Bloomberg) — Telenor, which is embroiled in a dispute about the strategy of VimpelCom, wants the Russian mobile-phone company to buy Ukraine’s VAT Kievstar for $5 billion in cash rather than stock, as management proposed last month.
The offer is contingent on Russian billionaire Mikhail Fridman’s Alfa Group, the other major VimpelCom shareholder, agreeing to “a market-based separation mechanism’’ that would see one of the two shareholders buying out the other, Fornebu, Norway-based Telenor said in an e-mailed statement Monday.
Alfa and Telenor have been in a dispute over their Russian and Ukrainian holdings for more than a year. Alfa owns 32 percent of VimpelCom and 43 percent of Kievstar through its Altimo unit, while Telenor holds 26 percent and 57 percent.

TITLE: AvtoVAZ Goes Brazilian To Secure New Engine Supplies
AUTHOR: By Anna Smolchenko
PUBLISHER: Staff Writer
TEXT: MOSCOW — State official and AvtoVAZ board member Boris Alyoshin is set to visit an engine plant in Brazil in April, with a view to buying the plant for the country’s largest carmaker, a government spokeswoman said Friday.
The visit comes as AvtoVAZ embarks on a multibillion-dollar restructuring program, under which it plans to launch a dozen new models in the next five years. Securing a new engine supply is part of that plan.
During the visit to Brazil planned for April 2-7, Alyoshin, head of the Federal Industry Agency, will visit gasoline engine manufacturer Tritec Motors, an agency spokeswoman said. “AvtoVAZ is considering the purchase of the plant,” she said. 
Tritec, which is located in Campo Largo in the southern Brazilian state of Parana, is jointly owned by BMW and DaimlerChrysler. 
The confirmation comes after Kommersant reported Alyoshin would accompany Prime Minister Mikhail Fradkov to Brazil early next month. The report said the plant was worth up to $1.5 billion. 
An AvtoVAZ spokesman said he was unaware of the purchase plan. 
The 42,000-square-meter plant currently produces 1.6-liter gasoline engines mainly for BMW’s Mini car.
Last year, BMW said it planned to build the next-generation engine for its new version of the Mini at a Peugeot Citroen plant in Douvrin, France. It has not yet decided what it will do with the Brazilian plant.
“Both partners are jointly assessing various options,” BMW spokesman Marc Hassinger said on Friday from Munich. Hassinger declined to say whether selling the plant was a possibility. 
The plant’s annual capacity is around 250,000 engines, he said.
Securing new engines for AvtoVAZ was one of the points in a plan for the car industry drawn up last year by the Federal Industry Agency, which is part of the Industry and Energy Ministry. The plan, which called for $5 billion in state funds for AvtoVAZ, said the Russian car industry needed two new types of 1.1-liter to 2.2-liter gas engines and a new type of 1.8-liter to 2.2-liter diesel engine. 
Gairat Salimov, an automotive analyst with Troika Dialog, said purchasing an engine plant would make sense because it was quicker and simpler for AvtoVAZ than building its own plant from scratch. 
But, he said, the catch will be in getting the plant’s previous owner to leave behind any cutting-edge technology used in engine production.
Both Salimov and Kirill Chuiko, a car analyst with UralSib, pegged the engine maker’s value at under $500 million.
While the plant produces gasoline engines only, Tritec spokesman Thomas Prete said Friday that he did not “exclude the possibility of marketing diesel engines” in the future.
Last week, automotive firm GAZ said it was interested in buying a foreign diesel engine maker, adding it would consider purchasing jointly with AvtoVAZ.

TITLE: Arms Dealer in Takeover Talks
AUTHOR: By Yuriy Humber
PUBLISHER: Staff Writer
TEXT: MOSCOW — State-affiliated structures are in talks with VSMPO-Avisma to acquire majority control in the world’s largest titanium manufacturer, VSMPO-Avisma chairman Vyacheslav Bresht said Friday. 
Sergei Chemezov, head of state arms exporter Rosoboronexport, said later that day that his company was leading the talks with the titanium giant, Interfax reported. 
Chemezov said that the state agency was negotiating to acquire at least a blocking stake in VSMPO-Avisma but signaled that Roseboronexport would aim for majority control.
“We want to acquire the largest stake possible [in VSPMO-Avisma] — at least a blocking one — from current shareholders,” Chemezov said at a briefing in St. Petersburg, Interfax reported. He could not indicate, however, when the purchase would take place.
“It’s too early to say what will happen, the talks started just 10 days ago,” VSMPO-Avisma’s Bresht said Friday by telephone, adding that negotiations could be finalized within a month.
Bresht and Chemezov’s comments are the first confirmation that the state and the titanium maker are holding talks and follow weeks of speculation that the Kremlin was moving in on VSMPO-Avisma, which supplies titanium to Russia’s aviation and defense industries.
President Vladimir Putin signed off last month on the creation of a state aviation holding to be called Unified Aircraft, which will unite the country’s major aircraft manufacturers, as the Kremlin continues tightening its grip on the country’s strategic sectors.
Bresht said he was ready to sell his 30 percent stake to the state, noting that he could not speak for the company’s other major shareholder, general director Vladislav Tetyukhin, who had yet to make a final decision. Bresth and Tetyukhin together own 60 percent of VSMPO-Avisma, which holds about one-third of the world’s titanium market. Investment funds control about 13 percent after Renaissance Capital bought them in their interests in 2005, according to RIA Novosti.
In addition to domestic manufacturers, it supplies titanium to such aviation giants as Boeing and Airbus, as well as airplane engine makers Rolls Royce and Pratt & Whitney.
Tetyukhin would not comment Friday, but in last week’s interview with Rossiiskaya Gazeta he mentioned that while some state participation in VSMPO-Avisma was “acceptable,” he was opposed to giving the government a dominant role. He added, however, that contracts with foreign clients would not be disrupted, whatever the outcome.
Sergei Kravchenko, president of Boeing in Russia and the CIS, told Kommersant on Thursday that the aviation giant had received state guarantees that no disruption in its titanium supplies from VSMPO-Avisma would occur, regardless of the “variations around the [titanium maker’s] restructuring.”
Rosoboronexport took control of the country’s leading carmaker, AvtoVAZ, last year and has also been reported to be eyeing truck-maker KamAZ as a further target. On Friday, however, Chemezov said plans regarding KamAZ had changed. “We have gone back on plans to buy the government’s stake” of 34 percent in KamAZ, Chemezov said, Interfax reported.
For state consolidation in the metals sector, Rosoboronexport last month registered a new holding, AT-Spetstekhnologia, which may be used to hold the exporters’ stake in VSMPO-Avisma.
In a February statement, Ros-oboronexport said the holding would help coordinate the operations of metals companies that supply the defense and aerospace industries.

TITLE: Bewilderment as Browder Barred as Security Threat
AUTHOR: By Catherine Belton
PUBLISHER: Staff Writer
TEXT: MOSCOW — William Browder, the outspoken CEO of Hermitage Capital Management, Russia’s biggest foreign portfolio investor, has been denied entry to Russia under a rule that bars foreigners considered to pose a threat to national security, according to a Foreign Ministry letter obtained by The St. Petersburg Times.
Browder has crusaded against corporate governance abuses, most notably at Gazprom and Surgutneftegaz, and the news that he has been barred since November is stirring up worries in the foreign business community that the state is extending its efforts to silence critics to foreign investors.
“This looks like some kind of retaliation against active shareholders,” said Mattias Westman, CEO of Prosperity Capital Management, Russia’s second-biggest foreign portfolio investor and a partner with Browder’s Hermitage in challenging the murky ownership structure of Kremlin-friendly Surgutneftegaz in court.
“It is an entirely stupid thing to do,” Westman said. “We are trying to improve what needs to be improved, especially at state-controlled companies. That’s in the interest of both the state and shareholders.”
Browder’s problems are also prompting bewilderment because he has in recent years become one of the most vocal supporters of President Vladimir Putin’s Kremlin. Even as he has fought abuses at individual companies, he has defended in published articles and at major international conferences the crackdown on the oligarchs via the legal assault on Yukos owner Mikhail Khodorkovsky.
When border officials refused Browder entry as he arrived at Sheremetyevo Airport from London on Nov. 13, the decision was initially believed to be a mistake, people involved in the matter said. Browder’s visa had been valid until the end of March.
Just two days later, British human rights lawyer Bill Bowring, who had been representing Chechen clients, was also denied entry, prompting speculation that Browder, who tried to enter with a British passport, could have been mistaken for him.
It turned out, however, not to be a mistake. According to a letter dated Jan. 16 from the Foreign Ministry to Hermitage deputy CEO Vadim Kleiner, Browder had been denied entry in accordance with the federal immigration law’s Article 27, which bars entry to foreigners considered to be a threat to the security of the state, public order or public health. 
Britain’s Foreign Office is protesting the decision, with Foreign Secretary Jack Straw recently raising the issue with Foreign Minister Sergei Lavrov, The Associated Press quoted an unidentified British Embassy spokesman as saying Friday, when the news first broke.
“There are a number of senior government officials in Russia who have been working very hard to help us to get this problem resolved,” Browder said by telephone Sunday from London, where he has been living for the last four months. “Given the positive impact we’ve had in Russia in the last decade, it is hard to imagine it wouldn’t be fixed.”
Browder said that his absence from the Hermitage’s Moscow office had not affected operations. “It hasn’t created any problems. I’m running the business from London and it works because we have an extremely experienced team in place in Moscow.”
The fund is up 43 percent since November, in line with growth on the RTS.
Browder, now 41, left for Russia in 1996 from a Wall Street position at Salomon Smith Barney. The grandson of U.S. communist leader Earl Browder has since been preaching the benefits of capitalism and free markets for Russia. Along the way, his fund has climbed to a value of $4 billion this year. While many other funds went out of business in the August 1998 crash, Browder stayed on to fight for transparency in Russia’s biggest blue chips, helping their market cap and the value of his fund’s holdings grow in the process. 
In 2000, Browder kicked off a campaign to make the restructuring of electricity monopoly Unified Energy Systems more accountable to minority shareholders. With the help of other shareholders, he won. Then in 2003, he battled state-owned savings bank Sberbank over corporate waste and lack of transparency. Sberbank sued him for libel over the publication of his findings, but he won the lawsuit.
His most high-profile target has been state-controlled gas mammoth Gazprom, where he has attacked corporate waste and the misappropriation of billions of dollars in assets in a bid to raise corporate transparency and also win a seat on the board. Even though Gazprom has made steps toward greater corporate accountability, Browder has yet to win a seat.
Browder has made enemies along the way. In 1998, he hired 15 bodyguards after receiving threats of violence. But he has also won awards for his shareholder rights activism and plaudits from his colleagues.
“Few if any investors have done more to attract money into Russia and to improve corporate governance than Bill. He should be given a medal, not visa problems,” said James Fenkner, managing partner at the Red Star Management fund who has worked in Russia for more than a decade.
“The body of Bill’s work at Hermitage is practically a unique example of asking the right type of questions and holding the highest kinds of authorities to responsibility ... and indeed is a far too rare example of genuine courage in business in the country,” said Bernie Sucher, chairman of Alfa Capital. 
“You just have to shake your head in disappointment and amazement” over the decision to bar him, Sucher said.
Most astonishing, colleagues said, was that the measure had been taken against one of the Kremlin’s loudest cheerleaders.
“It seems like we can say anything we want and they’ll ignore it,” said Eric Kraus, chief strategist at Sovlink Securities. “The only time you get into trouble is when you stand between someone and the cash machine.”
Kraus said there was growing speculation — but no proof — that Browder’s standoff with Surgut could have been a reason behind the affair. 
Hermitage, together with Prosperity and New York-based Firebird Capital Management, has been fighting a system of ownership at Surgutneftegaz in which management retains control of the company through a complicated system of ownership via Surgut subsidiaries. Browder argues this is a system of treasury shares that undermines the rights of other shareholders. 
The Constitutional Court sided with Surgut on the issue in December.
Kraus said the decision to bar Browder did not tally with recent moves to improve Russia’s image abroad.
“Putin has made it clear he’s interested in solving Russia’s image problems. They’re spending $70 million on Russia Today,” Kraus said, referring to the Kremlin-sponsored satellite channel launched in November. “But this is the best way to destroy it. ... This sends a really bad message that business interests can interfere with agencies that are responsible for immigration.”

Staff Writer Yuriy Humber contributed to this report.

TITLE: Dealers Under Threat From Electronic Boxes
AUTHOR: By Alexander Yankevich and Natalya Chumarova
PUBLISHER: Special to The St. Petersburg Times
TEXT: The market for electronic payment systems in St. Petersburg is growing fast. This seems confirmed by the emergence of new players, the strengthening in position of existing firms, and the dynamic growth in the demand for their services. One might predict that such methods of payment will soon offer serious competition to the ordinary networks of dealers.
The idea of an electronic means to pay telecom companies as providers, as well as mobile operators, was introduced in 2001 by the company X-Cards. By 2002 the firm T-Pay had developed its own payment system and installed around 40 machines. At the same time, however, the development strategy of these companies changed, and almost all of the machines that sold cards were rented out, with T-Pay concentrating on a new unitary card payment system for MegaFon customers.
Nevertheless, active development of the market for electronic payment in St. Petersburg really got underway only last year, when the terminals of local company Unisensor (trade mark Unikassa) and Moscow-based Eleksnet appeared almost simultaneously. 
Unisensor is now installing its terminals in metro stations and trade and business centers. At present it has 55 machines but plans to increase this to 200 by the end of this year. According to a representative from Unisensor, Philip Pakhomov, such a decision is linked to increased demand — in the region of 10 to 15 percent a month.
Eleksnet, on the other hand, is installing its machines in shops and internet cafes. It plans to increase the number of terminals from its current level of about 120 to 300 by the end of the year. 
Since 2000, another Moscow-based company, Parnet Express, has promoted services under the trademark I-Box. It arrived on the St. Petersburg market at the end of 2005. The first I-Box machines were installed in the city in the Pik shopping complex and Zanevsky Cascade. They plan to add another 50 machines to the 60 they already have, offering more services and a more ergonomical design.
All companies offer a standard array of services. One can pay for the services of local mobile phone providers, purchase pin-codes for internet access and IP-telephony, and pay for the services of the TV channel NTVplus. Moreover, when using Eleksnet machines one can pay for communal services and access banking services. 
The company I-Box is also planning to offer such services. 
The market is growing, not only because of an increase in companies, but because of a rise in the number of services offered by these machines.
In the summer of 2005, the Digital Advertising Group launched a chain of multimedia complexes under the Fotka-I brand. Fortka-I machines allow the printing and editing of digital photographs, the downloading of content to mobile phones, and internet access. Fotka-I machines are located in internet center CafeMAX, the trade center Vladimirsky Passazh, and in one branch of the digital supplier Tsifrograd.
According to the companies, the city’s market for electronic payment systems is developing faster than Moscow’s, which is close to saturation. 
Vladimir Zhurbiolv, from Parnet Express (producer of I-box), said that today there is constant growth in the number of clients using this type of service.
The head of promotions at Eleksnet, Alexei Molchanovski, said that the electronic payment market is developing more actively than in Moscow, the turnover of one machine on average being higher here than in the capital. 
“This is easily explained. Here the proportion of electronic payments which involve bank services amounts to 50 percent, while in Moscow it is 10 percent. The market in Moscow is close to saturation while in St. Petersburg it is only beginning to really develop,” said Molchanovski. 
At the same time payment for mobile phone services is also more popular in St. Petersburg. Today there are about 500 machines that take payments for such services, and, according to market representatives, these machines are beginning to rival ordinary dealers, where payment and sale of mobile phone cards is one of the main services.
The dealers themselves say that the increase in the popularity of electronic payment is not affecting their own business.
“Recently, a considerable amount of telecom payment services have appeared on the market but one needs considerable levels of investment to create a secure system and to promote the service. Added to the need to provide a wide range of services, these factors make it more difficult to conquer the market,” said Tatyana Moskaleva, Head of PR at Dixis.
“As for the competition between the owners of the terminals and the dealers, it is still too early to talk about serious rivalry – not everyone is ready to pay for mobile services with the use of electronic terminals,” she said.
Dmitri Karmanov, director of marketing at mobile phone retailer Ultra, said that compared to last year, there had been an increase in the volume of payments in their shops. 
“Accordingly, at the moment there is no competition. It is possible that in the future, when such machines stand on every street corner — which is actually quite unlikely — then it might affect our sales. But at the moment most city residents pay for mobile phone services in the shops of mobile dealers,” he said.
As for the mobile companies, they are more optimistic when evaluating new possibilities, and even plan to develop their own independent networks.
‘Electronic payment for mobile services is still new and it is too early to talk about mass popularity. However, the level of growth shows that this method of payment is in demand, like many other methods available to our subscribers. At the moment we are developing a project to install multimedia kiosks in MegaFon Northwest service centers. As well as payments these kiosks offer other functions, such as the printing of digital photos, downloading mobile content etc.,” said Maria Georgievskaya, press secretary of MegaFon Northwest.

TITLE: Venturing to Russia With Funds
AUTHOR: By Alexander Yankevich
TEXT: According to the president of the MartinsonTrigon ventures fund, Allan Martinson: “There are a lot of ideas on the Russian IT market, but very little capital.”

The Russian IT market has begun to attract the interest of foreign investors. When the Baltic state ventures fund MartinsonTrigon became a co-owner of St. Petersburg’s Reksoft, which specializes in software outsourcing and business integration, many regarded this as a landmark event for the local market. Venture capitalists on the Russian market are few and far between, and the big news on this front usually comes from Moscow. The fact that such a major deal had taken place in St. Petersburg created extra interest, though analysts warned that the deal should not necessarily be seen as venture capitalism, as Reksoft is already a well-established company. A founder of the MartinsonTrigon fund and its president, Allan Martinson spoke to The St. Petersburg Times about plans for the development in Russia. 

What is MartinsonTrigon and how was it formed?
MartinsonTrigon was organized by an investment bank in Central and Eastern Europe, Trigon Capital (it has offices in Warsaw, Tallinn, Riga, Vilnius and St. Petersburg) and myself in the summer of 2005. The fund’s resources come from private investors in Northern Europe — for the most part Finland — who account for 60 percent of the capital. The fund is managed by AS Martinson Trigon Venture Partners. The main recipients of the investments are telecommunications and IT companies. The head office of our organization is in Tallinn. 

What kind of companies attract your funds – offshore centers, system integrators, on-line projects, developers of new technologies?
We’re interested in TMT – telecoms, media and technology. In terms of priorities, we’re looking at service IT companies, programmers and telecommunications companies working in innovative spheres – for the most part that means wireless and media projects. As far as our ongoing activities are concerned, in the space of about a year and a half we’ve looked at about 200 companies, and we’re now actively working with about 10. We’ve already signed three agreements, and we’ll be announcing another two in the summer. We’re defining our investments as venture undertakings – we work with individual companies for a maximum of 5-7 years. 

Your fund is based in the Baltic states. What is your interest in Russia? After all, one of your first major undertakings was an agreement with a Russian company.
In principle, we’re positioning ourselves as a Baltic-Russian fund – we’re planning to invest in these countries. We spoke about that in our first official announcements, which covered not only Reksoft but also the Estonian companies Microlink and TVCorp. Microlink is a computer services company and a leading player on the market in the Baltic states which I took a direct part in creating. TVCorp is the local branch of the MTV Corporation in Estonia. We’re planning on “taking in” another five to seven companies, after which, according to our calculations, we’ll have used up all our resources for this stage of the process. 

What do the IT markets in Russia and the Baltic states have in common and how do they differ? What’s your take on the investment potential of the Russian IT market? 
Overall, the IT markets in Russia and the Baltic states can be described as developed and fairly large. Of course, Russia is bigger in terms of territory and in certain other ways, but in hard figures the Baltics are also fairly big. They’re also united by the fact that they have a lot of potential, but you need a lot of capital to open them up. A difference is that service companies are highly developed in the Baltics, whereas it’s the technological sphere that is more highly developed in Russia. You can’t overlook another big difference – the companies in the Baltic states are more ordered, which makes working with them a lot easier. In Russia, you have to be prepared for the fact that, in order to get the company into a decent state from financial, legal and other points of view, you have to have a significant amount of money ready to put into an audit, and that can amount to tens of thousands of dollars. 

Recently there have been reports from the IT markets of interest being shown by new major investors, such as the Russian company Renova. Do you see yourselves as being in competition with other investors?
Yes, we can definitely see that process at work. There’s no doubt that there are strategic investors on the Russian market who can boast of possessing key assets in spheres that interest us. For the most part however, and in the regions in particular, it’s private business that’s working in the IT sector. Often, money is coming from companies that work in more traditional sectors of the economy – trade, real estate, and so on. It’s not a fact that these investments will work effectively – the people behind them don’t have the expertise or the contacts and so, often, an innovative business doesn’t have any additional value, which can result in it leaving the marketplace. There’s another tendency which shouldn’t be overlooked. As we know, the major western companies are actively working to open software development centers in Russia – Motorola, Sun Microsystems and the like. We can also see that as being part of the investment process.  These players usually buy up a 100 percent stake in Russian enterprises or create them from scratch. 

What do you think of the Russian government’s idea of creating technology parks and special economic zones? Will they help the Russian IT market? What are the prospects for development?
In view of the growing competition on the global IT market, the Russian government definitely had to do something. Technology parks are an effective tool which have proved their value in many countries. The way it’s all being implemented raises some questions though. As far as I can see, a specific characteristic of the Russian project is that firms will get benefits within certain geographical zones, which is to say certain links will be built in. In my view, that contradicts the whole essence of IT, which is free of all those conditions – at the end of the day, the programmer could be working from home, using the internet. And that’s without even mentioning the fact that these zones will attract firms looking for benefits that have nothing to do with IT. Companies should get benefits, but they shouldn’t be dependant on their geographical location. We should note another initiative from the Russian government – the creation of venture funds. Their appearance was unavoidable, as such initiatives have been undertaken in almost all the countries of Europe, and Russia just had to keep up. But its effectiveness will be directly dependant on the people that manage it and there really aren’t that many experts in this sphere in Russia.

TITLE: Tax Deadline Inevitably Draws Near…
AUTHOR: By Andrew Zhigulev and Valerie Mikhai
TEXT: “Taxes are what we pay for civilization”
Oliver Wendell Holmes, US Supreme Court Justice

As the statutory deadline for submission of individual income tax returns is fast approaching, it seems the ideal time for a general recap of tax legislation. 
What should be the first question one asks oneself with regards to tax obligations? In reality, there are a few important questions, for example: “Am I a taxpayer in Russia? What income should I declare? What rates should be applied to this income and by what date should the tax declaration be filed and tax payment made?” 
The core issue of individual income tax is determining one’s tax residency status. In Russia this does not depend on a person’s citizenship or domicile, instead it is based solely on the number of days spent on the territory of Russia in the calendar year.  An individual is considered to be a tax resident of Russia for income tax purposes if he or she is physically present in Russia for 183 days or more in a calendar year. 
Based on tax residency status, taxable income can be determined: for tax residents of the Russian Federation it should be their worldwide income and for non-residents it should only be income received from Russian sources.
Russian source income includes, but is not limited to, income received as a result of carrying out activities in Russia regardless of the nature of the payment, for example it may be remuneration from employment, rendering services and other actions in Russia, dividends from Russian companies, insurance payouts paid from a Russian source, income received from the use or sale of property in Russia, etc. Both Russian tax residents and non residents may be taxed on income paid in cash or in kind or in relation to which a taxpayer has received the right of disposal, as well as on imputed income. 
Due to the low resident tax rate, most types of income are taxable, but there are a limited number of exemptions allowed by law.   
Russian tax residents may decrease their taxable base by means of allowable tax deductions: standard, professional, social and property deductions. Tax non-residents are not allowed to claim any deductions.
Social tax deductions may be granted to the taxpayer if they have made a charitable donation to a Russian budgetary financed organization approved by law (for the actual amount, but not more than 25 percent of total income); payments for the education of the taxpayer and/or their children if paid by the taxpayer personally (in the amount of not more than RUR 38,000 ($1,300) per person per year); payments for medicines and medical treatment for the taxpayer and members of their family rendered by licensed medical institutions in Russia  (in the amount of not more than RUR 38,000 per person per year). However, acquiring the documentation required to claim these deductions may outweigh the potential tax savings.
Property deductions may be granted for the full amount of income derived from the sale of real estate and land plots or from the sale of other property which has been owned by the taxpayer for a period of at least three years. If property has been owned for less than three years, then a deduction from the taxable income of up to 1 million rubles ($35,700) for immovable property or 125,000 rubles ($4,500) for other property may be claimed.  Alternatively, the taxpayer has the choice of taxing the difference between the sale price and the documented expenses on the acquisition and sale of the property.  There is also a special deduction granted once in a lifetime deduction for the purchase of residential property in Russia, whereby up to 1 million rubles of capital costs may be deducted from the taxpayer’s taxable income.  Interest on a loan to construct or acquire such property is also deductible. 
There are special rules for the taxation of transactions with securities, but generally, the income on the sale of securities is calculated by deducting the documented expenses on the acquisition and sale of securities.  
The tax rate on individual income is generally 13 percent for Russian tax residents, but other rates may apply to specific types of income, such as 9 percent on dividend income and 35 percent on bank interest which exceeds the statutory norms, on certain insurance payouts, prizes and imputed income from low- or zero-interest loans.   Individuals who are not tax residents of Russia are taxed at the flat 30 percent tax rate on their Russian source income.  
For non-residents, exemption from Russian tax under a double tax treaty may be possible providing the applicable treaty relief criteria are met and appropriate supporting documentation is provided to the Russian tax authorities.   If Russian tax residents pay tax on their income in other countries, then it may be possible to claim a foreign tax credit on their Russian tax returns under an applicable double tax treaty. 
Russian legislation establishes that Russian organizations, entrepreneurs and permanent establishments of foreign legal entities should act as tax agents. In other words, they have to calculate and withhold income tax from payments made to individuals and remit it to the budget. Therefore, if individuals receive income from sources from which there is no tax agent or if their tax liability was incorrectly withheld by the tax agent, then the taxpayers should file tax returns to report the income and pay the taxes owed based upon tax returns.  Resident taxpayers may also have a filing obligation if they want to claim any deductions.
Should the obligation to file a personal income tax return for 2005 arise, an individual is required to do so either personally or via registered mail no later than April 30, 2006.
Foreign nationals who permanently depart Russia before the end of the year are also subject to a special filing requirement; they should file a departure tax return for the income received up to the date of leaving the country no later than one month prior to departure. 
The tax calculated in the tax declaration is payable by July 15, 2006 or within 15 days after the submission of a departure tax return. 
Finally, when submitting a tax return, foreign nationals should include a photocopy of all pages of their passports with their tax returns to confirm their residency status.  Additional documentation confirming reported income in the tax returns may also be requested by the tax authorities.  Therefore, we recommend taxpayers to plan well in advance of the April 30, 2006 filing deadline.

Andrew Zhigulev is a consultant and Valerie Mikhai is a manager in Deloitte St.Petersburg office.

TITLE: An Intellectual Property Rights Headache
AUTHOR: By Olga P. Barannikova
TEXT: In the past few months, Russian and international political circles have been focusing on Russia’s presidency of the Group of Eight and its agenda for the summit in St. Petersburg in July. One of the biggest ironies is that while presiding over the body of the world’s most economically and politically advanced democracies, Russia is still not a member of the World Trade Organization.
In Russia, the WTO accession topic is hot and is fueled by the successes of Ukraine, which has just reached an agreement with the United States that speeds the way to WTO membership. Russia’s continuing violations of intellectual property rights, especially in counterfeited products and pirated goods, and seeming lack of enthusiasm for bringing its legal and enforcement system into compliance with international intellectual property rights standards are still major barriers to joining the WTO. They have kept Russia on the U.S. government’s IPR priority watch list for several years. 
In fairness, Russia has made efforts to improve laws and enforcement to fight counterfeited DVDs, CDs, fake consumer goods and other infringements of intellectual property. It is no longer common practice to see fake goods being sold, inadvertently or not, on every street corner and in every kiosk and store. Yet this has not put an end to Russia’s long history of violations of intellectual property rights and non-compliance with international legal standards.
And there is potential for an even gloomier picture if the State Duma adopts a proposed Part Four of the Civil Code. The reaction of legal experts and the business community to the draft Part Four has been sharp. For one thing, the draft appeared like a bolt out of the blue. None of the organizations that had been working on this issue with the government had seen the draft or even knew of its preparation until it appeared in late February. 
At a meeting last Thursday of a government commission on intellectual property rights, First Deputy Prime Minister Dmitry Medvedev announced that the commission was ready to recommend that the Duma adopt Part Four of the Civil Code. 
But in a sign of possible division within the government over the draft, the commission’s written decision noted that it needed to be sent back to a working group within the presidential administration for revisions. The working group, which drafted the legislation, was given only two weeks to make the revisions.
If the legislation is adopted in its current form, the law would annul all special laws designed to protect trademarks, patents and copyrights. Those of us at the Coalition for Intellectual Property Rights who have studied the document have found several errors and problematic provisions. For example, the new Civil Code would not include detailed definitions of terminology, which is something that industry experts and government officials have worked very hard to include in intellectual property rights legislation. Imagine a leading international company trying to explain to a local court in Bryansk what a domain name is when the judge has never used the Internet. 
Excluding precise legal definitions could potentially create significant problems for the courts in deciding intellectual property issues and undermine the judicial system’s ability to protect those who are battling counterfeiters. Without clear definitions of terminology, it would be more difficult for judges to rule. This could reverse the strides made by the judiciary in mastering intellectual property law and handling the complex cases brought to the bench. 
This radical change to intellectual property legislation has the potential to jam up the courts and the Federal Service for Intellectual Property, Patents and Trademarks, the former Rospatent. In the past, minor changes to legislation have often immediately led to months of delays. With such a fundamental change to the legislation, the courts could be brought to a standstill, allowing counterfeiters to work without fear of legal consequences.
The legislation would have both a macroeconomic and a microeconomic impact on Russia. The potential losers would be Russian businesses, which rely on a predictable intellectual property rights regime to develop and expand, as well as consumers, whose trust in the quality and safety of brands would be further eroded. Russia could forfeit revenues in the form of taxes and customs fees paid by registered owners of intellectual property and face diminished foreign investment. Lastly, Russia’s admission into the world’s most important trade alliance could be delayed indefinitely.
Russia, as the chair of the G8, is expected to set an example to all democracies in the world. This means making issues that will have an impact on its business community and consumers, such as intellectual property laws, subject to public discussion and consideration. 
It is now time for the government, business community, registered owners of intellectual property and consumers to make sure that this important legislation is not allowed to simply slip through the cracks and be adopted without proper investigation and debate. The stakes for Russia’s future are too high. 

Olga P. Barannikova is the Russia representative of the Coalition for Intellectual Property Rights, an international association focused on legislative reforms, educational initiatives and public awareness building on intellectual property issues.

TITLE: Stuck in an Outhouse
AUTHOR: By Yulia Latynina
TEXT: Following the visit of a Hamas delegation to Moscow earlier this month, a number of jokes began making the rounds. One of these jokes is extremely apropos. Hamas political chief Khaled Mashaal, head of the delegation, returns home from Moscow. “What was Putin like?” his colleagues ask. “He’s a regular guy,” Mashaal replies. “Just don’t get stuck in an outhouse with him.” I don’t know about Mashaal, but if you ask me, the Kremlin has stuck the entire country in an outhouse. Our recent diplomatic initiatives speak for themselves. 
We invited a Hamas delegation to Moscow, and as soon as they got off the plane they refused to renounce violence or recognize Israel. We invited an Iranian delegation headed by top nuclear negotiator Ali Larijani for talks on our proposal to enrich uranium for Iran on Russian soil. Larijani turned us down. We insisted that negotiations were ongoing.
For a couple of weeks there the Kremlin was exceeding its own high standards. You may recall that on the eve of the G8 summit in 2000, President Vladimir Putin announced that he had convinced North Korea to abandon its nuclear missile program. North Korean leader Kim Jong Il then dismissed this as a joke.
The architects of our foreign policy seem bent on doing everything they can to spite the United States, and on creating as many enemies as possible for Putin so that he will come to view the diplomatic establishment as his best and last defense against them. But when you look beyond the psychological overtones, the reasoning behind our foreign policy is quite simple. The Kremlin is trying to create something from nothing — a position that it can abandon later in exchange for concessions from the West.
There are two problems with this strategy. For starters, Hamas, Iran and North Korea foster no illusions about Russia. If rogue states want to sell out to the West, they can do so without engaging Foreign Minister Sergei Lavrov as their agent. The plan was for the Kremlin to manipulate these rogue states for its own benefit. Instead, Hamas and the rest are using Russia to drag out negotiations at the United Nations and to ensure worldwide coverage of their declarations at Russian airports.
The second problem is that by holding talks with rogue states, Russia comes perilously close to being perceived as a rogue state in its own right. Rogue states are not countries with authoritarian regimes. In the world of realpolitik, no one cares what governments do to their own people. The rogues are countries with an unpredictable foreign policy.
In a recent column, I wrote that it was ridiculous to argue about whether or not Iran’s nuclear program was intended for peaceful ends when the Bushehr nuclear power plant on the shores of the Persian Gulf was effectively the world’s biggest suicide bomb. This was a layperson’s opinion.
On March 9, the newspaper Novaya Gazeta published the comments of Konstantin Kuranov, who served as deputy atomic energy minister from 1996 to 1998. Kuranov said that when talks were opened with Iran, Russian specialists proposed a new site where construction of a nuclear power plant could begin from scratch. “The Iranians insisted that we complete the unfinished German plant at Bushehr, which was more complicated for us because we had to install our reactor in a different structure,” Kuranov said. “In conversation, one of the Iranians noted that this site was preferable because it was closer to Israel.”
Does helping Iran to build a stationary nuclear bomb “closer to Israel” constitute an unpredictable foreign policy? And do our foreign policy masterminds understand that the advantages of turning Russia into a rogue state — i.e. the opportunity to create lots of enemies and then become indispensable to the president as the first line of defense against them — are somewhat offset by minor inconveniences like the freezing of accounts in Western banks?

Yulia Latynina hosts a political talk show on Ekho Moskvy radio.

TITLE: Bone Thugs
AUTHOR: By Chris Floyd
TEXT: Hardened cynics often accuse President George W. Bush of ruthlessly exploiting the tragedy of 9/11 to advance his preset agenda of killing a whole heap of foreigners. This is, of course, a calumnious slander against the Dear Leader’s noble ambitions. For as he demonstrated last week, Bush is also exploiting the tragedy of 9/11 to advance his preset agenda of killing a whole heap of Americans as well.
In yet another one of those momentous degradations of public morality that go unremarked by the ever-vigilant watchdogs of the U.S. media, Bush slipped a measure into the revamped “Patriot [sic] Act” he signed last week that will allow him to expedite the death penalty process across the land, the Austin American-Statesman reports. 
Prisoners just aren’t being killed fast enough for ol’ George, you see. They hang on for years and years, using all them lawyer tricks and court procedures, that DNA hocus-pocus and habeas corpus junk, or even new testimony showing they’re innocent — as if that mattered. No, you got to strap ‘em down and shoot ‘em up with that poison juice lickety-split, churn those convict corpses out like so much prime pork sausage, the way ol’ George did it when he was head honcho down in Texas.
This remarkably vindictive and bloodthirsty measure — which has absolutely nothing to do with the “war on terrorism” or “homeland security,” the ostensible subjects of the Patriot Act — strips the judiciary of its supervision over state-devised “fast-track” procedures to speed up the execution process. 
During the Reagan Administration, it became all the rage to “cut the red tape” that kept prisoners alive until the appeals process had run its course and determined there were no egregious errors in their cases before the government killed them. The red tape-cutting crusade was led by then-Chief Justice William Rehnquist, who once ruled that even new proof of innocence was no bar to killing a prisoner if state courts had earlier upheld his conviction, the Washington Times reports. Urged on by Rehnquist — who was executed by God last year — several states went the fast-track route, limiting the time that prisoners have to file petitions and narrowing the range of factors that judges can consider in death-row appeals. 
Unfortunately, America’s courts were not yet fully packed with hard-right cadres, and even the vulturous Rehnquist couldn’t keep them all in line. Fast-track options in state after state were struck down by federal judges because the fast-trackers’ death-penalty systems were such a shambles, riddled with literally fatal incompetence. One glaring example could be found in — where else? — Texas, where Governor Bush was mowing them down on his way to becoming the greatest mass killer in modern U.S. history, with 152 notches on his belt.
Bush had set up a veritable execution assembly line in his fiefdom, assisted by his trusty legal aide, Alberto Gonzales. Knowing just what the boss wanted, Al would prepare dumbed-down capsules of death-penalty cases, stripping away pesky details like “ineffective counsel, conflict of interest, mitigating evidence and even actual evidence of innocence,” the Atlantic Monthly reports. Bush would “sometimes” bother to look at the reports, sometimes not, Gonzales said. In his six years as governor, Bush spared only one condemned prisoner from execution: the serial killer Henry Lee Lucas. All the rest — including women, juvenile offenders and even the mentally retarded — got the spike. Yet one in every eight death row inmates has been exonerated since the United States resumed the death penalty in 1976, the Washington Times reports — an astonishing percentage of false imprisonment in capital cases. It is virtually impossible that Bush did not kill some innocent people with his relentless 152-1 execution ratio.
In 1996, the courts put a crimp in Bush’s carnival of death, ruling that Texas failed to meet “minimum competency standards” for the fast-track system. He had to make do with the old-fashioned appeals process, which slowed but never stopped his killing spree: He averaged almost two executions per month during the course of his term. 
But he never forgot or forgave the judicial interference with his dominion over life and death. How it must have rankled, to think that this judicial brake on wholesale state-sponsored slaughter still existed in the Homeland, when he — the great Commander, breaker of nations — could now order the “extra-judicial killing” of anyone on earth whom he arbitrarily deemed a “terrorist” and send mighty armies to grind tens of thousands of people into bloody mulch. Who would dare put fetters on the godlike sway of the “unitary executive”?
So now he has taken his revenge. The backdoor measure in the Patriot Act decrees that responsibility for awarding fast-track death-penalty status to the states will now be the sole prerogative of the U.S. Attorney General — one Alberto Gonzales. Yes, the fawning minion whose perversions of law on behalf of his boss have abetted war, torture, corruption, assassination, abduction, rendition, dictatorship and the slipshod Texas death machinery will now decide if states are scrupulous enough to resume lickety-split executions. You can hear those sausage grinders gearing up all over America.
God only knows what festering psychic wounds drive these spiritual cripples and their obsession with death. But for them, power isn’t real unless it’s written on the body of another human being — a prisoner, guilty or not; an “enemy,” real or imagined; or the multitude of slaughtered innocents whose only crime was living in a land that the cripples wanted to conquer.

TITLE: Belarus Poll Condemned by Lukashenko’s Rivals
AUTHOR: By Olena Horodetska
PUBLISHER: Reuters
TEXT: MINSK — President Alexander Lukashenko said triumphantly on Monday his re-election showed efforts to stage a pro-West revolt in Belarus had failed, but independent observers criticized the poll as neither free nor fair. 
The OSCE gave an expected thumbs-down to Lukashenko’s victory after 10,000 protesters — huge numbers for the tightly controlled ex-Soviet state — massed to denounce Sunday’s election as rigged and support challenger Alexander Milinkevich. 
Opposition leaders called for bigger street protests against Lukashenko on Monday night. 
“The 19th March presidential election did not meet the required international standards for free and fair elections,” said Alcee Hastings, a special coordinator for an Organization for Security and Cooperation in Europe observer mission. 
“The findings are supported by numerous empirical evidence. ... Democracy in Belarus is in its infancy,” he said. 
Lukashenko, shunned in the West, defended his re-election as honest and democratic, adding: “Let me say, that the revolution that so many people talked about and some were preparing, has failed and it could not be otherwise.” 
Referring to Western support for the political opposition, he told a news conference: “Despite the pressure and orders from outside, they couldn’t break us.” 
Protesters dismissed as blatant fraud results giving Lukashenko, described by Washington as Europe’s last true dictator, more than 80 percent of the vote. 
Milinkevich called for new elections and urged people to take to the streets again, though the prospect of sustained protest to Lukashenko’s re-election seemed uncertain. 
The Belarus opposition seemed keen to try to galvanize the population into mass protests like those seen in former Soviet Ukraine and Georgia that also followed disputed elections. 
Though Russia’s foreign ministry voiced backing for Lukashenko, saying the outcome had to be respected, the negative reaction from the OSCE foreshadowed sharp criticism from the United States and the West and ensured that Belarus’s international isolation would continue. 
The European Union said new sanctions were “very likely”, possibly extending a ban on travel visas for Belarus officials. 
Past turmoil in other ex-Soviet states over elections has clearly disturbed President Vladimir Putin, who has been at pains to restore as much as he can of Moscow’s fading influence in former Soviet republics. 
Moscow’s backing for Lukashenko now, despite the Kremlin’s distaste for his political style, set it at odds with the United States and Russia’s other G8 partners. 
Lukashenko, accused in the West of systematically crushing human rights, had threatened in the final days of the campaign to “wring the neck” of anyone staging the sort of upheaval that brought liberals to power in other ex-Soviet states. 
Milinkevich’s campaign manager appealed for bigger protests of the kind in which vast crowds helped overturn fraudulent results in ex-Soviet Georgia and Ukraine. 
“The number in the streets yesterday is not enough to make the authorities listen to the people,” Sergei Kalyakin said. “We need at least 10 times that number.” 
But it was not at all certain that opposition activists would stage any sustained protests, given the repeated warnings and tough laws against illegal assembly. 
Protesters stood for three hours in snow and biting winds on Sunday, waving the red-and-white national flag long banned by Lukashenko. 
The head of Belarus’s Central Election Commission, Lidiya Yermoshina, had earlier officially declared Lukashenko, 51, the winner of Sunday’s contest. 
“Election results show incumbent President Alexander Lukashenko scored a decisive victory, securing 82.6 percent of the vote,” Yermoshina told a news conference broadcast live.

TITLE: Ukrainian Relations Hinge on Vote
AUTHOR: By Mara Bellaby
PUBLISHER: The Associated Press
TEXT: KIEV, Ukraine — Voters look set to deal President Viktor Yushchenko a rebuff in a parliamentary election next Sunday that could tilt their divided country back toward Russia just 16 months after a revolution that appeared to move Ukraine closer to the West. 
It’s a bitter twist for Yushchenko, whose Orange Revolution ushered in the very reforms that are making this contest the most democratic in the former Soviet republic’s history. 
Now he must contend with polls predicting the winner will be his arch-foe, ex-Prime Minister Viktor Yanukovych, the man whose fraud-marred run for the presidency in 2004 triggered the revolution that along with similar upheavals in the former Soviet states of Georgia and Kyrgyzstan has encouraged democratic restiveness in neighboring Belarus. 
Yushchenko’s presidency is not at stake in this election, but widespread disappointment with the peaceful revolution’s unfulfilled promises of prosperity and an end to corruption has left Yushchenko’s camp struggling even to win second place. 
The resurgence of Yanukovych, whose political career seemed buried by the Orange Revolution, could reshape the pro-Western politics of this nation of 47 million people stretching between the European Union and Russia. 
Most analysts predict Yushchenko will be pragmatic and reach out to Yanukovych to form a coalition, since neither of their parties will get enough votes to form a parliamentary majority. 
Proponents of a coalition say it could help bridge Ukraine’s deep regional divisions, absorb the 44 percent of voters who didn’t support the revolution, and improve Kiev’s rocky ties with Moscow. 
Critics say it could slow Ukraine’s West-ward turn and return power to some officials that the Orange Revolution leaders had vowed to jail. 
“If this coalition is formed, what was the point of the revolution?” said former Prime Minister Yulia Tymoshenko, whose acrimonious split with the president last fall shattered the Orange Revolution team. 
The charismatic Tymoshenko, whose fiery speeches helped spur the protesters in November 2004, wants the prime minister’s job back and has focused her campaign on disillusioned revolution supporters who, analysts say, could give her party a strong showing. 
Yushchenko’s bloc has countered by spending much of the campaign blaming Tymoshenko for the plunge in annual economic growth from 12 percent to 2 percent, the rise in prices of staples such as meat and sugar, and last year’s privatization debacle that scared off foreign investors. 
Both insist in public that they want to reunite, but when asked recently to name one good thing Tymoshenko did in office, Yushchenko’s face hardened. Seconds ticked by. “I’m composing my emotions so I can restrain them,” he said finally, and didn’t name one thing. 
Publication of polls in the week before an election is barred, and earlier surveys varied dramatically. But most put Yanukovych’s bloc in the lead with around 30 percent, followed by Yushchenko’s and Tymoshenko’s parties running neck-and-neck at 15 percent to 22 percent each. 
That could mean Yushchenko having to serve out the 3 1/2 years left in his term with a government working against him, Prime Minister Yuriy Yekhanurov warned voters. 
The disarray dismays voters such as Olha Prikhodko, 60, whose home in western Ukraine is adorned with photos of Yushchenko and his five children, and of Tymoshenko, who braids her blonde hair in peasant style. 
“All I want is for Yulia (Tymoshenko) and Viktor Andriyovych (Yushchenko) to make peace and reunite,” Prikhodko said. 
With that peace looking increasingly unlikely, analysts are debating the implications of Yanukovych’s possible return. 
He draws his support almost exclusively from Ukraine’s industrial, Russian-speaking east, and wants Russian, which was dumped as the state language after the country became independent in 1991, to be restored to official status alongside Ukrainian. 
He says he supports Ukraine joining the rich and prosperous European Union, but views membership in a trade zone with Russia, Belarus and Kazakhstan as an immediate priority. 
Yanukovych’s ally, businessman Alex Kiselev, expects Yanukovych to pursue a policy more balanced between Russia and the West, remarking: “You never bet your whole hand on one horse.” 
But Yushchenko would retain significant powers to shape policy. 
The president gets to appoint the foreign and defense ministers, and the current foreign minister, Borys Tarasiuk, a Ukrainian nationalist, is widely expected to stay in the job. 
Yushchenko has told journalists he is sure foreign policy won’t change, saying that “European-Atlantic integration is in harmony with our national interests.”

TITLE: U.S. Criticism Of Russian Democracy Dismissed
AUTHOR: By Vladimir Isachenkov
PUBLISHER: The Associated Press
TEXT: MOSCOW — Russia on Monday accused the United States of trying to enforce its vision of democracy on others, angrily rejecting President George W. Bush’s criticism of the Kremlin’s rollback on freedoms. 
“No one has ... a monopoly on interpreting what democracy is,” the Foreign Ministry said in a statement in response to Bush’s National Security Strategy report released last week. 
Bush said in the report that recent trends in Russia “regrettably point toward a diminishing commitment” to democratic freedoms and institutions. “We will work to try to persuade the Russian Government to move forward, not backward, along freedom’s path,” Bush said in the document, his first major foreign policy review since 2002. 
The Russian Foreign Ministry criticized what it called an “increasing emphasis on ideology” in the U.S. security strategy and indicated that Moscow will not accept lectures from Washington. 
“Every country is walking its own path to democracy, taking into consideration specific historic and political conditions, as the United States itself has been doing,” the ministry said in a statement released to the media. “Attempts at artificial and moreover, forceful enforcement of democracy in other nations not only cannot bring success, but are fraught with discrediting the idea.” 
U.S.-Russian ties, which were given a boost by President Vladimir Putin’s support for the U.S. war on terror after the Sept. 11, 2001 terror attacks, soured later over Russian criticism of the U.S. military action in Iraq and U.S. concerns about an increasingly authoritarian streak in Russia’s domestic policy. 
Critics say that Russia has seen a steady rollback on democracy under Putin, pointing at the emergence of a tame parliament packed with Kremlin loyalists, the abolition of elections of provincial governors, effective state takeover of nationwide television and, most recently, the approval of a new law tightening restrictions on non-governmental organizations. 
Putin has defended the moves as necessary stages in Russia’s gradual movement toward a stronger democracy. Russia, in turn, has accused the United States and other Western nations of encouraging regime change in the former Soviet republics of Georgia, Ukraine and Kyrgyzstan. 
The Russian Foreign Ministry criticized the reviewed U.S. national security strategy for “claiming an active democracy-building role in the countries neighboring Russia.” 
“The warning that Russia’s attempts to “hamper” such democracy-building would worsen its relations not only with the United States but with Europe sounds rather pretentious,” it said. 
In a note of rebuke, the ministry said the U.S. document contained “no single word about ... cooperation between our nations ... mutual respect and consideration of each other’s legitimate interests in practical policy, predictability of behavior and transparency of action.” 
It warned that without respecting these principles, “U.S.-Russian relations would become hostage to subjective assessments.”

TITLE: Russia Tries for Deal on Iran
AUTHOR: By Nick Wadhams
PUBLISHER: The Associated Press
TEXT: UNITED NATIONS — Russia’s UN ambassador rejected proposals that would have the UN Security Council demand a quick progress report on Iran’s suspected nuclear program, saying — half in jest — that fast action could lead to the bombing of Iran by June. 
Andrei Denisov spoke Friday just before a UN Security Council meeting where diplomats considered a revised list of British, French and U.S. proposals for a statement on Iran. The latest draft proposals retain many elements that Russia and China have opposed. 
A key sticking point for Russia is a proposal asking Mohamed ElBaradei, the chief of the International Atomic Energy Agency, to deliver a report in two weeks on Iran’s progress toward clearing up suspicions about its nuclear program. Russia and China say two weeks is far too soon. 
“Let’s just imagine that we adopt it and today we issued that statement — then what happens after two weeks?” Denisov said in an interview. “In such a pace, we’ll start bombing in June.”
Denisov chuckled after he made the remark, but it reflected Russia’s fears that the international community had not yet decided how to respond if Iran continued to resist demands that it make explicitly clear it is not seeking nuclear arms. 
The ambassadors of Britain, France and the United States said they were flexible on the 14-day deadline, and diplomats suggested that the council could ultimately ask for a report in 30 to 45 days as a concession to Russia and China. 
“We have signaled that there’s flexibility on the assumption that we adopt this text soon, but the longer it takes, then the shorter the time will be,” said Britain’s UN ambassador, Emyr Jones-Parry. 
The council planned to reconvene Tuesday, when it might adopt a final agreement. 
But U.S. Ambassador John Bolton betrayed an increasing frustration with Russia, which along with China wants the council to take only mild action. Bolton warned that as he spoke, Iran’s centrifuges were enriching uranium — a crucial step toward producing weapons-grade fissile material. 
“If I were as near to Iran as Russia is, I’d certainly want to get this resolved quickly,” Bolton said. “I think in the Russian nuclear establishment, I think they know exactly what Iran is doing.” 
In the meantime, senior officials from six key countries involved in negotiations over Iran’s nuclear program will convene Monday to discuss both initial council action and the larger strategy toward Iran. The officials from Britain, China, France, Russia, the United States and Germany will talk about both the proposals circulated Friday and overall strategy. 
For the last week, the Security Council has debated the best way to address the Iran issue.

TITLE: Paris Shaken by Student Rioting
PUBLISHER: Agence France Presse
TEXT: PARIS — French Prime Minister Dominique de Villepin was steeling himself for a showdown over his contested youth jobs plan, ignoring an ultimatum for its withdrawal from the organisers of a growing protest movement. 
“[The] Laws of the Republic, voted democratically by parliament, must be respected,” Villepin said in a letter sent to members of his center-right Union for a Popular Movement (UMP).
Union and student leaders were due to meet late Monday to determine the next phase in their campaign against the First Employment Contract (CPE), amid signs that the stand-off with the government will intensify in the days ahead with a possible general strike.
After hundreds of thousands took part in at times violent mass protests on Saturday, organisers gave Villepin a 48-hour deadline to withdraw the contract, which allows companies to fire employees aged under 26 without explanation during a two-year trial period.
But Villepin told UMP deputies that the CPE was “an essential tool for freeing up the labour market and creating jobs.”
“It is also an important lever for equal opportunities. All young people, whatever their origin, must be able to practise a trade that corresponds with their qualifications.”
The prime minister won support from his close ally President Jacques Chirac, to whom opponents of the CPE appealed earlier to use his influence to have the contract abandoned.
But Chirac said that “it is essential to take steps for youth employment, and the CPE is a sign of this determination on the part of the government and parliament. Questions and doubts are being expressed and that is wholly legitimate... but they must not lead us to do nothing.”
Conceived by Villepin as a tool for bringing down France’s high level of youth unemployment, which is as high as 50 percent in areas hit by last year’s riots, the CPE was adopted by parliament 10 days ago as part of a wider equal opportunities bill and is now waiting to be written into the statute books. But the measure has sparked a powerful opposition alliance of unions, students and left-wing parties, who say it is a charter for employer exploitation and a breach of hard-won social rights.
Three days of nationwide demonstrations over the last two weeks have drawn hundreds of thousands onto the streets in protests that on Saturday ended in several hours of running battles.

TITLE: Blair Called to Quit As Sleaze Begins to Stick
AUTHOR: By David Clarke
PUBLISHER: Reuters
TEXT: LONDON — British Prime Minister Tony Blair faced growing pressure on Monday to step down over a sleaze row which has tarnished his reputation and boosted calls for finance minister Gordon Brown to take the reins. 
The “cash for favors” row blew up after it was disclosed rich businessmen had been nominated for seats in the upper house of parliament after lending the Labour party large sums to bankroll its 2005 election campaign.
Right-leaning newspapers have been clamoring for Blair to go for days, but on Monday, The Guardian — long seen as the institutional voice of the center-left — joined the chorus.
“Nine years is long enough,” it said in an editorial. “There is no excuse for foot-dragging, no excuse for trading on the patience of his party, the country or his successor.”
Blair’s spokesman brushed off speculation about the future of the prime minister, who has been dubbed “Teflon Tony” for surviving past political fallout unscathed.
Most big political parties in Britain depend on loans and Blair did not break any law by not declaring them. Under current rules only donations to parties have to be made public.
But what irks some Labour lawmakers is that their party treasurer and some senior ministers did not know about the $25 million received, fuelling allegations that Blair’s inner circle was running a secret slush fund.
In response to the furor, Lord Falconer, the Labour minister for constitutional affairs, said on Monday the government would seek to amend the law on party loans.
Separately, Blair has appointed career civil servant Hayden Phillips to review funding rules in general. Blair’s spokesman said on Monday that Phillips would examine state funding for parties, among other issues, and report back by the end of 2006.
Blair has said he will not fight a fourth election, due by mid-2010. He won a third term last May but saw his majority slashed, partly due to opposition over the war in Iraq.
However, most analysts expect him to stay on for several years to push through his public service reform agenda and only hand over to leader-in-waiting Brown shortly before the next election.
Bookmakers reckon Blair is set on staying in power longer than the 11-1/2 years notched up by former Conservative prime minister Margaret Thatcher, which would mean hanging on until the end of November 2008.
But besides the sleaze row, he is fighting a rebellion within party ranks over his school reforms plan. The bill only passed a key hurdle in parliament last week thanks to opposition Conservative votes when 52 Labour lawmakers rebelled.
“This [sleaze] is far more dangerous to Blair than whether or not he had to rely on Conservative votes for the education bill. It’s too close to him,” said John Curtice, professor of politics at Strathclyde University.
The row is also hurting Blair in the opinion polls. A YouGov survey published on Sunday put his approval rating at 36 percent, the lowest since he came to power in 1997.

TITLE: Trail of Destruction Left As Australia Battered by Storm
AUTHOR: By Meraiah Foley
PUBLISHER: The Associated Press
TEXT: CAIRNS, Australia — The most powerful storm to hit Australia in three decades laid waste to its northeastern coast Monday, mowing down sugar and banana plantations with 180 miles-per-hour winds but causing no deaths or serious injuries. 
Innisfail, a farming town of 8,500 located about 60 miles south of the tourist city of Cairns, was hardest hit, and Mayor Neil Clarke estimated that thousands of residents were left homeless.
More than 100,000 people were without power, and the damage was estimated to be in the hundreds of millions of dollars. Prime Minister John Howard pledged immediate cash handouts to the homeless and said more help would be forthcoming.
“The damage to dwellings is very extensive,” Howard told the Nine Network from Melbourne. “Thank heavens it does not appear as though there have been any very serious injuries.”
Clarke told the Australian Broadcasting Corporation the local airport was being cleared to house people in tents.
The town’s main street was littered with mangled tin and iron roofs and shredded fronds from seaside palm trees.
“It looks like an atomic bomb hit the place,” Clarke said. “We won’t even have any water to drink by tomorrow.”
Cyclone Larry crashed ashore south of Cairns as a Category 5 storm. Cairns is a popular jumping-off point for tourists to the Great Barrier Reef, the world’s largest coral system that runs parallel to the coast for more than 1,400 miles.
Authorities said it was too early to assess possible damage to the reef, visited by nearly 2 million tourists each year.
David Wachenfeld, director of science at the government body that cares for the reef, said the worst-hit area of the reef was not one that was popular with tourists. He said it would recover — though that could take 20 years.

TITLE: Retired Downing Street Cat Mourned
PUBLISHER: The Associated Press
TEXT: LONDON — Humphrey, the cat who shared 10 Downing Street with two British prime ministers but was evicted by current resident Tony Blair, has died. He was aged about 18. 
Blair’s office said late Sunday that Humphrey died last week at the home of a civil servant who had adopted him.
The black-and-white stray wandered into Downing Street in 1989 when it was occupied by then-Prime Minister Margaret Thatcher, and was named in honor of Sir Humphrey Appleby, the Machiavellian civil servant in the sitcom “Yes, Minister.”
He remained under Thatcher’s successor, John Major, but moved shortly after Blair took office in 1997, prompting a Conservative lawmaker to ask in the House of Commons for assurances he was still alive.
Blair’s wife Cherie denied reports that her dislike of cats was responsible for Humphrey’s eviction. Officials said Humphrey was suffering from a kidney complaint and needed a quieter home.

TITLE: Deadly Bird Flu Virus On the Wing
AUTHOR: By Martin Burlund
PUBLISHER: Special to The St. Petersburg Times
TEXT: The bird flu virus is continuing to spread around the world with Egypt’s government reporting that a man was suspected to be suffering from the virus after a woman was said to have died of the potentially fatal H5N1 strain of the disease last week. 
The woman’s death raised alarm in the Middle East, where two other human fatalities resulting from bird flu have already been reported in Iraq. 
The Azerbaijan Ministry of Health has reported three cases of avian influenza infections in humans, all of which have been fatal, Eurosurveillance Weekly reports. Two patients were from the same southeastern area of the country, but lived in different settlements. 
In Azerbaijan, wild birds infected with highly pathogenic H5N1 were confirmed in February. Outbreaks in poultry were subsequently discovered, but not in the areas where the patients lived. 
The Ministry of Health has already introduced an efficient  system of patient notification, transportation, treatment in isolation, and tracing and management of contacts. Daily house-to-house surveillance for cases continues. Indonesia continues to report human cases. 
Denmark is the 11th European country to report cases of bird flu. 
On Thursday, a single wild common buzzard was found in the south of the island of Zealand and on Friday nine ducks were found dead 200 kilometers to the west of Zealand.
Authorities have implemented protection measures in line with those in other European countries.

TITLE: Deadly Bird Flu Virus On the Wing
AUTHOR: By Martin Burlund
PUBLISHER: Special to The St. Petersburg Times
TEXT: The bird flu virus is continuing to spread around the world with Egypt’s government reporting that a man was suspected to be suffering from the virus after a woman was said to have died of the potentially fatal H5N1 strain of the disease last week. 
The woman’s death raised alarm in the Middle East, where two other human fatalities resulting from bird flu have already been reported in Iraq. 
The Azerbaijan Ministry of Health has reported three cases of avian influenza infections in humans, all of which have been fatal, Eurosurveillance Weekly reports. Two patients were from the same southeastern area of the country, but lived in different settlements. 
In Azerbaijan, wild birds infected with highly pathogenic H5N1 were confirmed in February. Outbreaks in poultry were subsequently discovered, but not in the areas where the patients lived. 
The Ministry of Health has already introduced an efficient  system of patient notification, transportation, treatment in isolation, and tracing and management of contacts. Daily house-to-house surveillance for cases continues. Indonesia continues to report human cases. 
Denmark is the 11th European country to report cases of bird flu. 
On Thursday, a single wild common buzzard was found in the south of the island of Zealand and on Friday nine ducks were found dead 200 kilometers to the west of Zealand.
Authorities have implemented protection measures in line with those in other European countries.

TITLE: Worldwide Protests As Iraq War Enters 4th Year
AUTHOR: By Joseph B. Frazier
PUBLISHER: The Associated Press
TEXT: PORTLAND, Oregon — Protesters marking the third anniversary of the Iraq war made their voices heard around the world at the weekend, with the largest marches in London, Portland and Chicago, though in numbers that were often lower than in previous years. 
About 10,000 anti-war protesters in Portland took nearly an hour to pass through downtown streets Sunday, some carrying signs that said “Impeach the Evildoer.”
“It is time now for you to take back your country,” said Steven DeFord, whose son, Oregon National Guard Sergeant David Johnson, 37, was killed in Iraq by a roadside bomb in 2004.
In Louisiana, 200 war veterans, hurricane survivors and others gathered at the Chalmette National Cemetery to protest how the war had hurt the country’s ability to help the Gulf Coast recover from last year’s hurricanes.
“We attacked a country who never did anything to us,” said Philadelphia resident Al Zappala, whose 30-year-old son was killed in Iraq in 2004. “He was sent to Iraq based on lies.”
About 200 marched Sunday down New York’s Fifth Avenue, with signs including: “Resist the War — Don’t Enlist.” Nineteen were given summonses for disorderly conduct and released, police said. Saturday’s rally drew more than 1,000 people.
Also Saturday, more than 7,000 people marched through downtown Chicago.
The protests drew crowds far short of the millions who protested the Iraq invasion in March 2003 and the anniversary in 2004.
President Bush marked the anniversary Sunday by touting the efforts to build democracy in Iraq. He avoided any mention of the continuing daily violence there and didn’t utter the word “war.”
“We are implementing a strategy that will lead to victory in Iraq,” Bush said.
Outside the United States, protests included a 1,000-strong rally in Seoul, where demonstrators urged the South Korean government to bring their troops home.
In Malaysia’s largest city, Kuala Lumpur, about 600 people protested peacefully, unlike a gathering last year when police used a water cannon to disperse demonstrators. In Tokyo, about 800 demonstrators took to the streets, after some 2,000 protested the day earlier.
In London, police said 15,000 people joined a march Saturday from Parliament and Big Ben to a rally in Trafalgar Square. The anniversary last year attracted 45,000 protesters in the city.
Venezuelan leader Hugo Chavez, a strident Bush critic, offered some of his harshest criticisms of the U.S. president in months.
“The world is opposed to your war, Mr. Danger,” Chavez said on his weekly television and radio program. He also called Bush a “coward,” a “donkey” and a “drunkard.”
Activist Cindy Sheehan, who energized the anti-war movement last summer with her monthlong protest outside Bush’s Texas ranch, joined the Gulf Coast marchers in Mississippi on Friday, but left early Sunday for events in Washington.

TITLE: Bloodshed Marks Anniversary
AUTHOR: By Sinan Salaheddin
PUBLISHER: The Associated Press
TEXT: BAGHDAD, Iraq — Suspected insurgents marked the third anniversary of the U.S.-led invasion of Iraq on Monday with roadside bombings that killed at least seven policemen, and authorities reported finding 10 more bullet-riddled bodies dumped in the capital, one of them a 13-year-old girl. 
The violence took up where it left off Sunday when at least 35 people died.
One of the roadside bombings Monday, just a few hundred yards from an Interior Ministry lockup in central Baghdad, killed at least three Iraqi police commandos and a prisoner, police Lieutenant Colonel Falah al-Mohammedawi said. 
Four commandos were injured in the midday attack.
A second roadside bomb in a farming area in the so-called Triangle of Death south of Baghdad killed four policemen, police Captain Muthana Khalid Ali reported from the area.
The 10 dumped bodies, apparently executed, were the latest gruesome discoveries tied to the underground sectarian war being conducted by Shiite and Sunni Muslims as they settle scores in the chaos that grips the capital.
As many as 700 people have been killed in sectarian violence since the Feb. 22 bombing of a Shiite shrine in Samarra and the subsequent series of car bombings and mortar attacks in the Sadr City slum on March 12.
Baghdad residents voiced anger Monday when asked about their lives as the war entered its fourth year.
“Since [U.S.-led troops] came into Iraq, we get nothing,” said Ali Zeidan. “Three years have passed by for the Iraqi people and they are still suffering psychologically... and economically.”
Five Shiite pilgrims headed to Karbala were the victims of a drive-by shooting in an attack by assailants with automatic rifles in the town of Iskandariyah, 30 miles south of Baghdad. All were injured, police said.
As millions of pilgrims gathered in Karbala on Monday to complete 40 days of symbolic mourning for Imam Hussein, the Prophet Muhammad’s grandson, Baghdad International Airport was ordered to be closed through Tuesday “to avoid any violence during the [religious] commemoration,” said Transportation Ministry spokesman Ahmed Abdul-Wahab.
Authorities have closed the airport in the past citing the need for security during elections.
In the southern Baghdad neighborhood of Dora, gunmen opened fire on a former Baghdad mayor as he left his house Monday morning, causing serious injuries. 
Assailants killed one policeman and injured four police officers and two civilians late Sunday in three separate attacks on police patrols in the city of Mosul, 225 miles northwest of the capital.
On the political front, Iraqi leaders still had not formed a government more than three months after landmark elections for the country’s first permanent post-invasion parliament, but they did announce an agreement on establishing a Security Council to deal with key matters while negotiations proceed.
The announcement was made Sunday after the fourth in a series of U.S.-brokered all-party meetings on forming a new government.
“It was a successful meeting, and we have agreed on forming a National Security Council whose powers will not contradict the constitution,” Adnan al-Dulaimi, a Sunni Arab political leader, told The Associated Press.

TITLE: Bush Defends Iraq Strategy
PUBLISHER: The Associated Press
TEXT: WASHINGTON, D.C. — Returning to the White House after a weekend at the presidential retreat in Camp David, U.S. President Bush offered an upbeat assessment on the Iraq war. 
“We are implementing a strategy that will lead to victory in Iraq. And a victory in Iraq will make this country more secure and will help lay the foundation of peace for generations to come,” he said. 
Nearly 1,500 U.S. and Iraqi soldiers on Sunday sought to root out insurgents from farming villages an hour’s drive north of the capital. They have captured dozens of suspects in the air-assault operation that began Thursday. 
The 133,000 American troops on the ground inside Iraq number nearly a third more than took part in the campaign to oust Saddam Hussein that began in the early hours of March 20, 2003. 
At least 2,314 U.S. military personnel have died in the war, which is estimated to have cost $200 billion to $250 billion so far.

TITLE: Sports Watch
TEXT: Alonso Wins in Asia 
SINGAPORE (Reuters) — The form book held when Fernando Alonso made a winning start to his world title defense last weekend but the tropical heat of Sunday’s Malaysian Grand Prix could throw up a few surprises. 
The Spaniard said after his victory at Manama that four teams — Renault, Ferrari, McLaren and Honda — looked like potential race winners this season. 

Mixed Marathon
LOS ANGELES (AP) — Lidia Grigoryeva of Russia staved off a late charge by men’s champion Benson Cherono to win the Los Angeles Marathon in a race marred by the deaths of two runners. 
Grigoryeva, who set a course record Sunday in the women’s division, earned a $100,000 bonus for the winning time of 2 hours, 25 minutes and 10 seconds. It was the second time in three years a woman has won “The Challenge,” a battle-of-the-sexes format that allows women to start ahead of their male counterparts. 
James Leone, 60, who collapsed about 1 mile into his 11th marathon, and Raul Reyna, 53, who completed about 24 miles of the race, both died after being taken to hospitals. 

Paralympic Success
TURIN, Italy (AP) — Russia led the medals table with 13 golds and 33 medals overall at the Turin Paralympics, which ended Sunday. Russia’s medals came in biathlon and cross country skiing.

TITLE: World Champ Wins With Ease
PUBLISHER: Reuters
TEXT: MELBOURNE — World record holder Asafa Powell powered to his first major title with a comfortable victory in the Commonwealth Games men’s 100 meters final on Monday. The burly Jamaican stormed clear early to finish in 10.03 seconds but eased up over the closing stages so that his nine-month-old record of 9.77 was never under threat. 
“I can run sub-10 any time but I’m just not ready,” Powell told reporters. 
Nigerian Soji Fasuba claimed silver in a time of 10.11 and Marc Burns of Trinidad and Tobago the bronze in 10.17. 
Powell burst clear after about 20 meters and was never threatened in a commanding performance, dispelling any lingering fears of a groin injury that had kept him out of competition since last July. 
“I’m pleased. I didn’t want to push too hard because I’m just coming off an injury,” he said. 
Powell survived a scare in a drama-packed semi-final when he crossed into an opponent’s lane, risking disqualification, before reaching the finish line. 
Television replays showed that Powell was looking up at a giant television to his left when he inadvertently moved from lane six into Canadian Anson Henry’s lane five. 
Powell qualified in the fastest time of 10.03, exactly the same as he ran in the final. 
Event officials said action could only be taken if another runner complained. They said no one had lodged a complaint and that Powell had not impeded Henry, who qualified seventh fastest for the final in 10.28. 
Powell’s compatriot Michael Frater and England’s Mark Lewis-Francis were not so lucky in a bizarre semi-final that got underway at the fourth attempt. 
Frater, second in last year’s world championships, was the first to be eliminated after the field had been put under warning following Australian Patrick Johnson’s false start. 
Frater was disqualified for breaking early and Lewis-Francis, a relay gold medallist at the Athens Olympics, followed for the same offence.

TITLE: Omsk Oust SKA From Playoffs
AUTHOR: By Christopher Hamilton
PUBLISHER: Special to The St. Petersburg Times
TEXT: Avangard Omsk swept SKA St. Petersburg 3-0 in the first round of the best-of-five Professional Hockey League playoff series with a 3-1 win in game three at the Yubileiny Sports Palace on Thursday night. 
Fourth-ranked Siberian powerhouse Avangard dominated the series, quickly eliminating SKA from their first appearance in the playoffs since 2000. They won the first two games in Omsk 3-0 and 5-1.
“As soon as we knew that we’d be playing Avangard, I said that there was no point in building any illusions. They are one of the league’s elite teams,” said SKA acting coach Sergei Cherkas. 
Anchored by a stellar performance by goalie Maxim Sokolov, SKA did what it could to try to avoid being swept and force game four. 
SKA held the visitors to a scoreless first period, but Avangard struck twice at the start of the second period. SKA’s only real offensive prowess came midway through the game at 30:28, when Alexei Akifyov threaded the puck to Igor Yemeleyev who beat Omsk goaltender Norm Maracle. 
SKA pressured with a feeble attacking game which saw numerous squandered opportunities including two one-on-one breakaways against Maracle.
SKA continued to dump and chase in the third period but was rarely fast enough to create any real chances and was easily contained by Avangard, which was playing conservatively sitting on a one goal lead. 
SKA fans were on the edge of their seats, hopeful that they might tie the game, until late in the third period when Avangard defenseman Nikita Nikitin picked up the puck and quickly fed it to Anton Kuryanov who broke into a two man rush with Alexander Popov against Sokolov.  Kuryanov crossed the puck to Popov who easily scored at 56:37, sealing the win. 
“We only had a slight chance of forcing game four of this series, but Avangard is a team of talented players and they prevented us from capitalizing on our chances. It’s difficult to hope for a miracle, particularly when our team struggled toward the end of the regular season,” Cherkas said. 
“We were well prepared for this game,” said Avangard Head Coach Valery Belousov. “SKA can be a difficult and challenging opponent, but we outplayed them.”
Over the years, Avangard has attracted many of St. Petersburg’s most talented and popular players including Maxim Sushinsky, Maxim Sokolov, Alexei Kuznev, and Alexander Yudin. 
This drain on St. Petersburg’s talent has created something of a following for Avangard in Russia’s Northern Capital. 
“I’m really happy that Avangard won,” said fan Viktor Smirnov, a St. Petersburg resident and fan of both clubs. 
“I’ll always root for SKA but Avangard has the resources to build a real team. They always perform well in the playoffs and international competitions and I hope they’ll go all the way this year.”

TITLE: Federer, Sharapova Take Pacific Life Open Titles
PUBLISHER: The Associated Press
TEXT: INDIAN WELLS, California — Roger Federer stumbled early, then came roaring back for a 7-5, 6-3, 6-0 victory Sunday over James Blake to win the Pacific Life Open for an unprecedented third consecutive year. 
Blake broke Federer’s serve twice to take a 4-1 lead in the first set, but then Federer began taking over the match — just as he is dominating the ATP Tour these days. 
“He really got the better of me in the beginning, so I had to react and not panic. I did a good job there,” the Swiss star said. 
“In the end, I played fantastic tennis, with some great shots once again. To pull them off in a final, it’s always a nice feeling. The form is excellent right now.” 
Top-ranked Federer, whose all-around skill is a cut above the rest, thought Blake’s play to start the match looked familiar. 
“He played aggressively, took the ball early, put away his forehands when he could, didn’t miss on the backhand, made me run around,” Federer said. “That’s usually what I do. He gave me a little bit of my own medicine.” 
The championship signaled that Federer is back in top form following his lone loss of the year, to Rafael Nadal in Dubai this month. Blake upset No. 2 Nadal in the semifinals at Indian Wells. 
Federer won for the 25th time in his 36 tournaments dating from the start of 2004. 
He’s 22-1 this year and his three titles include the Australian Open, his seventh Grand Slam championship. 
On Saturday, Maria Sharapova was rock solid in the wind against Yelena Dementiyeva in the Pacific Life Open title match. 
The 18-year-old Sharapova, her blonde pony tail whipping in the gusts, defeated Dementiyeva 6-1 6-2 in an all-Russian final. 
Sharapova’s title was the first of the year and the 11th career win for the 2004 Wimbledon champion who lives in Bradenton, Florida. 
After Dementyeva hit still another backhand into the net on match point, Sharapova beamed, did her ballerina-like waves to the crowd, then blew kisses to the fans. 
“[The wind] was difficult for both of us,” she said afterward. 
“A lot of balls, you didn’t know where they were going, especially on the serve. 
“On these kinds of days, it’s not about playing great tennis; it’s about finding a way to win.” 
“I think Maria was able to handle the situation and play with the wind better,” Dementiyeva said.

TITLE: IN BRIEF
TEXT: A Soccer Nation at Last?
ST. PETERSBURG (SPT) — FIFA/Coca-Cola World Rankings for February place Team USA fifth, ahead of soccer giants such as France, Germany and Italy, it has been reported.
Bruce Arena’s side has won four out of five preparatory games ahead of the FIFA World Cup finals to be held in Germany in the summer. After drawing with Canada, the team won against Norway, Japan, Guatemala and Poland, scoring 13 goals and conceding two.
“We know we can compete with anybody. If we keep it tight at the back and get the goals, I feel confident that we can beat anybody,” goalie Kasey Keller was reported to have said after keeping a clean sheet against Poland.

Nine Boy Scouts Dead
BOGOTA, Colombia (Reuters) — A mudslide swept down on a scouting expedition in central Colombia, killing nine young hikers and leaving two others missing, authorities said Sunday. The scouts had just been bathing and practising tying knots when they were carried away, survivors said. 
The Colombian scouts, ranging in age from 12 to 19, were on an expedition Saturday with two guides near the snowcapped Nevado del Ruiz volcano close to their home city of Manizales, said German Salgado, regional president of the Scouting Association of Colombia.
The scouts were in a boulder-filled canyon when heavy rains caused the Chinchina river to rise several feet, sending down a crushing load of earth and rock that swept away the scouts.
“It wasn’t raining where they were,” said Maria Pilar Perez, emergency coordinator of the Caldas province. “They had no idea what was coming from upstream.”

Nepalese Violence 
KATHMANDU (Reuters) — At least 16 people, including 13 soldiers, were killed in a new outbreak of violence in Nepal on Monday, a day after Maoist rebels ended a crippling road blockade, the army and witnesses said.
The soldiers and a rebel were killed in a gun battle in Kavre district 80 km (50 miles) east of Kathmandu early in the day as the guerrillas attacked soldiers on their way to fix water  supply lines disrupted by the Maoists.
Elsewhere, two civilians were killed in a bomb blast near the eastern town of Biratnagar, 550 km (340 miles) from Kathmandu, local journalist Bickram Neupane said. The bomb had apparently been left by the rebels on a bridge to enforce the road blockade that they ended on Sunday.

Israel Opens Lifeline
JERUSALEM (Agence France Presse) — The Israeli authorities have decided to partially reopen the main trade crossing into the Gaza Strip after the United Nations warned of a looming humanitarian crisis as a result of food shortages.
A spokesman for the defence ministry in Tel Aviv said the Karni crossing in central Gaza, which has been closed for most of the year, was being reopened on a temporary basis to allow aid to be brought into the territory.
“We have decided to partially reopen Karni for a limited time for humanitarian reasons,” the spokesman told AFP.
The move came after talks on Sunday hosted by the U.S. ambassador to Tel Aviv where the Palestinians pressed for the reopening of Karni.
The UN agency for Palestinian refugees also warned on Sunday that the residents of Gaza were running dangerously short of basic foodstuffs, including bread and sugar.