SOURCE: The St. Petersburg Times
DATE: Issue #1209 (75), Tuesday, October 3, 2006
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TITLE: Georgia Releases Russian 'Spies' Amid Crisis
AUTHOR: By Misha Dzhindzhikhashvili
PUBLISHER: The Associated Press
TEXT: TBILISI, Georgia — Georgia on Monday released four Russian officers whose arrest on spying charges prompted Moscow to announce sweeping travel and communications sanctions in the worst bilateral crisis in years.Hoping to defuse tensions, Georgian President Mikhail Saakashvili said he had decided to hand over the Russians to visiting Belgian Foreign Minister Karel De Gucht, the current chairman of the Organization for Security and Cooperation in Europe, even though Georgia has a strong case against them.
"I want to make it very clear: we have a very well-founded case," Saakashvili told reporters at a briefing. "It's a very solid case of espionage, subversion and trying to destabilize my country."
The officers were then brought to Georgian prosecutors who reaffirmed spying accusations against them and barred them from entering Georgia again before handing them over to the OSCE.
The Kremlin said that President Vladimir Putin discussed the situation in Georgia with President Bush in a telephone conversation Monday. It did not elaborate.
The arrests last week infuriated Russia, which has put its troops in Georgia on high alert, recalled its ambassador and evacuated its diplomats and other citizens from the former Soviet republic to the south.
Russia's transport and communications ministries said all air, road, rail, sea and postal links with Georgia would be suspended. Russian carrier Aeroflot said it would stop all flights to Georgia as of Tuesday.
The sanctions will be especially painful for Georgia, affecting a large number of its citizens who travel to and from Russia on business and family matters.
In a sign of further Russian punitive measures, the Russian parliamentary speaker Boris Gryzlov said the State Duma lower house planned to pass legislative amendments that would allow the government to ban banking operations with certain countries, Interfax reported.
Huge numbers of Georgians work in Russia and send back remittances to their families, and the suspension of banking links with Russia would be a major hardship for Georgia's economically struggling population.
The head of the Russian railways, Vladimir Yakunin, said Russia would cancel a planned order worth $3.75 million for spare parts for electric locomotives from Georgia, according to ITAR-Tass.
The Russian Embassy in Tbilisi said the four officers would be flown to Moscow later Monday, ITAR-Tass reported. A source in the Georgian government, who declined to be identified because of the sensitivity of the contacts between Tbilisi and Moscow, said a plane from Russia's Emergency Situations Ministry had arrived to carry back not only the four detained officers but also two more sought by the Georgians on allegations of spying.
Ties between Tbilisi and Moscow had already been strained over Georgia's bid to join NATO and allegations that Russia was backing two Georgian separatist provinces. Moscow denies that claim.
Putin denounced the arrests Sunday as "state terrorism."
"Those who are doing that believe that the anti-Russian course of foreign policy meets the Georgian people's interests. I don't think so," Putin said.
The commander of Russian military forces in Georgia said his troops had been put on high alert and ordered to shoot to kill to defend their bases.
Some senior pro-Kremlin lawmakers urged even stronger measures. Georgian parliamentary speaker Nino Burdzhanadze, in an interview published Monday, said that his country was counting on international support if the dispute escalated dangerously.
Russian Defense Minister Sergei Ivanov has said the arrests of the Russians were aimed at pushing Russian troops out of Georgia so the government could seize control of the separatist provinces by force.
Despite the tensions, Putin said Russia would stick to a deal signed last year to withdraw its troops from Georgia by the end of 2008.
Russia's long-fraught relations with Georgia have worsened since Saakashvili came to power following the 2003 Rose Revolution, pledging to move the country out of Russia's orbit, bring breakaway provinces back into the fold and join NATO in 2008.
Along with some 2,500 peacekeepers in the breakaway provinces of Abkhazia and South Ossetia, Russia has between 3,000 and 4,000 troops at two military bases in Georgia that it pledged to withdraw by the end of 2008 under a deal signed last year.

TITLE: Students Tense After Hate Killing
AUTHOR: By Ali Nassor
PUBLISHER: Special to The St. Petersburg Times
TEXT: About 500 foreign nationals gathered at Ploshchad Lenina on Sunday in the latest and biggest hate crimes protest rally in a week that saw a series of non-sanctioned public protests following the fatal stabbing of an Indian medical student — the fourth murder of a dark-skinned man this year in St. Petersburg.The Aug. 27 killing followed a string of hate crimes committed against communities from the developing world in recent years.
Local sympathizers, mostly elderly women, chanted slogans for justice and security at the rally, whose participants also included local lawmakers.
Placards reading "Shame To Guest-Killing Hosts" and "Fascists Killed You, Now They Kill Us," reflected a week of high tension at the Mechnikov Medical Academy where the slain 27-year-old, Nitesh Kumar Singh, was a student.
Tensions began to mount when the Academy's foreign students rallied at its main compound last Monday to take Rector Alexander Shabrov to task and accuse the city authorities and law enforcement agencies of putting their lives at risk.
This was followed by a picket of mainly Indian students in front of the city's Prosecutor's Office in St Isaac's Square the same day. Pockets of non-sanctioned protest rallies reportedly took place in various residential areas where foreign students live on Wednesday.
The Academy's foreign students returned to classes following three days of mourning after paying respect to Singh last Thursday as his ashes were taken from the city's crematorium on Shavirovsky Prospekt to be flown to India the following day.
Reacting to students' security concerns, police patrols were stepped up at the three-hostel compound at 14 Kirillovskaya Ulitsa where Singh was killed.
Illuminations were fitted at the notoriously dark courtyard and pavements at the compound during the week. With angry students threatening to return to their home countries unless protection was guaranteed, the Academy could have faced financial crisis.
More than 600 foreign students in the Medical Academy pay an average of $4,000 each annually in tuition fees and for accommodation.
"We lie to people at home, or else no mom or dad would pay for a child to get killed," Farouk Ahmad, a sixth-year student from Kashmir, told a meeting between Shabrov, city officials, law enforcement representatives and a 300-strong crowd of students last week.
"The press! Get the hell out of here!" Shabrov said, only for the students to accuse him of attempting to conceal the truth, according to Fontanka.ru.
When contacted by The St. Petersburg Times, foreign students at the Academy made detailed allegations of a string of insulting and abusive behavior toward them from Russian students this week. This has led some to believe that Singh was killed by students from Russia living in the same compound.
One incident led to a midnight standoff between foreign and Russian students after a brawl was stopped by police. In numerous seperate incidents, at least three foreign students were hospitalized and treated for shock.
Lanson George, 23, a fifth-year medical student from India, who lives in another hostel attached to the Menchikov Academy where an Indian student was murdered in 2002, said tensions were running high throughout the institution.
"Usual hate graffiti aside, messages like 'Indians, You are the Next!' are common in our hostel whenever a serious racist crime is reported," he said.

TITLE: Russia Victorious at Homeless World Cup
AUTHOR: By Galina Stolyarova
PUBLISHER: Staff Writer
TEXT: A team of homeless men from St. Petersburg and Novosibirsk representing Russia defeated Kazakhstan 1-0 in the final of the Homeless World Cup soccer trophy on Saturday after a weeklong tournament held in Cape Town, South Africa. The victorious team was due to return to St. Petersburg on Monday night.Nearly 500 homeless men and women from 48 countries competed in the four-aside tournament.
The Homeless World Cup is organized by the Independent Network of Street Papers, an umbrella group covering 50 newspapers that raise money and provide work for homeless people around the world, including The Big Issue in the U.K. and Australia, Diagonal in Argentina, Hecho en Chile in Chile and Russia's Put Domoi, which is based in St. Petersburg.
Speaking at a news conference in South Africa after Russia's victory, team captain Vyacheslav Shelayevsky become emotional.
"One of my greatest dreams has been fulfilled," he said. "I will never forget these days. Our main goal when we get home is to help set up a street soccer league in Russia. Football once came to my rescue. I've made friends and if anything happens to me, I now have friends to help me." Arkady Tyurin, editor of Put Domoi magazine, devoted to and distributed by the city's homeless, said tournaments like this give its participants much more than a chance to exercise and maintain a healthier life style.
"It helps them regain confidence and self-esteem, and serves as an important tool for social adaptation through building teamwork, respecting rules and rivals, and being respected, too," Tyurin said.
Yelena Korneyeva, former spokesperson for Put Domoi who is still closely affiliated with the publication, said the Russian team managed to build a strong reputation within days after arriving in South Africa on Sept. 23.
The Russians stormed their way to the final, beating the England 5-2, and Estonia by a massive 10-1.
Uganda lost 6-0 to Russia while Switzerland also failed to take a goal from the losing 3-0.
In the semifinals Russia beat Mexico 5-0 and Kazakhstan beat Poland 3-1.
The matches, with four players on each side and lasting 15 minutes, were played at a pitch set up on Cape Town's main square.
"The more games the Russians won, the more terrified their rivals became," Korneyeva said by telephone on Monday. "In the end, other players were shaking in their boots and quaking with fear at the mention of the Russian team."
The St. Petersburg team first traveled overseas in the summer of 2003 to take part in the World Homeless Soccer Tournament in Graz, Austria, where they took 13th place out of 18 teams.
But later results have been much more encouraging, and the Homeless World Cup is not the first top international sports trophy claimed by the team. In November 2005, the team won the European Homeless Soccer Cup, after a triumphant 4-0 victory over Poland. The team also finished fifth of 27 teams during the Homeless World Cup in Gothenburg, Sweden, in 2004.
The Russian team is able to train and exercise on a regular basis. The players are allowed to make good use of St. Petersburg's Metrostroi stadium grounds twice a week on average, for no cost.
Such competitions use the positive power of sport to raise awareness of the issue of homelessness and poverty on an international scale. Social integration programs centered around sport have been practised successfully by organizations like the English soccer street league for many years.
The events also help counter common stereotypes of homeless people as social parasites, alcoholics or criminals.
Research published by the organizers of this year's Homeless World Cup said that of the players in last year's tournament in Edinburgh, Scotland, 94 percent reported a new motivation in life, 62 percent were coping better with alcohol and drug dependency, 40 percent had improved their housing, 38 percent held regular jobs and 28 percent had resumed their education, Reuters reported.
Several world-class professional soccer teams support the Homeless World Cup teams in their native countries. The English team is supported and coached by Manchester United, Spain has links with Real Madrid, and Portugal with SL Benfica.
However no top-flight Russian teams, including FC Zenit St. Petersburg, has yet been involved in helping out the current champions.
The 2007 Homeless World Cup will take place in Copenhagen, Denmark.
Mel Young, president and co-founder of the competition, said Denmark put in an excellent bid, supported by the Danish Government and the city of Copenhagen.
"The bid offers, in particular, a very efficient mechanism to ensure smooth running of the visa process for the players," Young said at a news conference last weekend. "The Homeless World Cup gets better every year... It demonstrates that football has tremendous power and can make a huge impact on people's lives. Football changes the world."
David Duke, the coach for the Scottish team, and a former homeless man who was an alcoholic, is now a columnist with The Big Issue Scotland and head of a boys' football team in Glasgow, as well as being a coach for the Scotland homeless soccer team.
Duke became homeless after the death of his father.
"Playing for Scotland, my country, was the rope I needed to pull myself out of a dark hole," Duke said in an interview with www.streetsoccer.org before the start of this year's tournament. "It gave me all the tools I need for a confident life and it is great that I can now help other young people to do the same."

TITLE: Prosecutor General Criticizes Airlines
AUTHOR: By Alex Nicholson
PUBLISHER: The Associated Press
TEXT: MOSCOW — The Prosecutor General said Monday that Russian airlines use fake and substandard parts and operate without the necessary safety and security checks, Russian news agencies reported.The comments by Yury Chaika came after a slew of crashes this year that have claimed more than 400 lives and cast a harsh light on the decrepit state of many of the nation's airlines.
"Flight Security is extremely poor," Chaika was quoted as saying by the ITAR-Tass agency.
"The aircraft accidents, which have lately become increasingly frequent, engender fears in our society and distrust of the Russian air carriers. They greatly impair the country's prestige too," he said.
In August, a Tu-154 jet belonging to Pulkovo Airlines crashed in Ukraine after encountering a storm, killing all 170 people aboard. In July, an Airbus A310 belonging to airline S7 skidded off a runway and burst into flames in the Siberian city of Irkutsk, killing 124 people.
An A320 belonging to the Armenian airline Armavia crashed into the Black Sea while trying to land in the resort city of Sochi in May, killing all 113 people aboard.
Russia's Deputy Prime Minister Sergei Ivanov called for tougher legislation to regulate the nation's many airlines, many of which lack the cash to overhaul their Soviet-era fleets.
"We must start work to enlarge companies or create alliances, as well as enshrine in law the responsibilities of the aviation industry, repair plants and airlines," he was quoted by the RIA-Novosti news agency as saying.
In an effort to upgrade Russia's pool of antiquated aircraft, VAT needed to first be reduced on domestically made planes, after which customs duties needed to be cut on models that aren't made in Russia, Ivanov said.
"First the domestic industry, then the imports," he said.
Ivanov called for cutting out the intermediary companies selling parts and recommended raising payouts to crash victims to a minimum US$75,000.
Ivanov — who is also defense minister and was appointed to oversee air safety in August — said that companies were turning a blind eye to safety violations in an effort to keep costs down.
"Sometimes matters of business, of commercial gain, are put before air safety," he said.
Russia's Transport Minister Igor Levitin meanwhile targeted corrupt officials.
Hes said that under their aegis struggling and decrepit airlines are able to continue operating, despite the violations.
"In the course of the inspection it became clear that competing firms are using illicit tactics bordering on the criminal," he was quoted as saying by the NTV television channel.
"This is taking place under the control of negligent officials," he said.

TITLE: Editor of Kommersant Steps Down
PUBLISHER: The Associated Press
TEXT: MOSCOW — The editor of Kommersant quit the newspaper Friday, a month after a deal was announced to sell it to a steel magnate with ties to state gas monopoly Gazprom.Kommersant's new owner, Alisher Usmanov, accepted the resignation of Vladislav Borodulin, said Pavel Filinkov, commercial director of Kommersant Publishing House. "They had a conversation in the process of which the decision was taken to appoint a different editor," Filinkov said.
"His decision to resign wasn't forced, but evidently they expressed different views on how the publishing house should be developed."
The newspaper, with a daily print run of about 115,000 copies, is widely respected for its comprehensive reporting on business and finance as well as general news coverage often critical of the Kremlin.
Kommersant's editorial line has contrasted with most other large newspapers that have pulled back from criticism amid the cooling media environment under President Vladimir Putin.
Former shareholder Boris Berezovsky — the one-time Kremlin insider who fell out with Putin and lives in self-imposed exile in England — sold his stake to partner Badri Patarkatsishvili earlier this year.
Under a deal announced a month ago, Patarkatsishvili sold it to Usmanov, the owner of the Urals Steel company, iron mines and president of Gazprominvestholding, a 100 percent subsidiary of state-controlled Gazprom.

TITLE: Collapse at Moscow Building Site Kills 5
PUBLISHER: Combined Reports
TEXT: MOSCOW — Five people died and three were injured Sunday morning when a flight of stairs collapsed at a French construction site outside Moscow, the Emergency Situations Ministry said.A ministry spokesman said that the accident occurred at 10:46 a.m. when part of a staircase collapsed at a store being built by the privately owned French retailer Auchan in Kotelniki in the Lyuberetsky district of the Moscow region.
Auchan spokeswoman Marie-Helene Boidin Dubrule said from Paris, however, that the accident had occurred a 120,000 square meter commercial development being built by French group Bouygues, and that Auchan was only renting a portion of the site.
The spokeswoman said Auchan would not start its tenancy there for another three months and that the accident had not affected its section of the site.
There was no immediate comment by Bouygues on Sunday.
(Reuters, SPT)

TITLE: Learning How To Make Friends and Make Millions
AUTHOR: By Simon Shuster
PUBLISHER: Staff Writer
TEXT: MOSCOW — Boris Berezovsky only wished he could have taken this class.In an age when having good Kremlin connections appears to make all the difference, students on Tuesday crammed into the main auditorium at Moscow's Higher School of Economics to learn how to get along with the people who run Russia.
"Power thrives on relations with business," panel chair Alexander Shokhin said. He added: "The question for business, then, is to establish systematic relations, partnerships, with the state."
Perhaps in no other place in the world does knowing the right people matter as much as it does in this country. Oligarchs who were once close to President Boris Yeltsin, such as Boris Berezovsky, now live in Britain and Israel. Khodorkovsky, the former Yukos head who dared to challenge President Vladimir Putin, now lives in a prison not far from the Chinese border.
The goal of the seminar, titled "Theory and Practice of the Interactions Between Business and Power," is to help the next generation of entrepreneurs forge good ties with officials, from the federal government to the regions to towns strewn across the country, organizers said.
As president of the Russian Union of Industrialists and Entrepreneurs, Shokhin has longstanding relations with the state. Panelists also recognized the need for small business to develop connections.
Panelist Sergei Borisov, president of the Russian Organization for Small and Medium-Sized Businesses, said entrepreneurs must know how to navigate the sometimes-rocky shoals of Russian bureaucracy. Agencies overseeing real-estate acquisition, environmental and health regulation and other areas often create hurdles for business owners.
Organizers at the Higher School of Education expect the seminar will lead to an entire academic department that will focus on building business-government relations.
"The traditional concept of corruption," Shokhin explained, "has been that of business influencing government." But in recent years, he added, pressure has been exerted by government officials on the private sector.
The Yukos breakup, beginning with Khodorkovsky's arrest, is widely viewed as a signal to business leaders that Putin's ascendancy represented a paradigm shift.
The new era of business-government relations, said Vladimir Pribylovsky, president of the Panorama think tank, has today reached its apex in Russia.
"No businessman can function now in Russia without connections to power," Pribylovsky said. "If it is a small businessman, this means connections with the police or municipal government. And if he is a big businessman, he must be connected with the Kremlin."
Those in attendance at Tuesday's seminar — studying everything from economics to marketing to computer science — seemed eager to learn about this new reality.
All of the panelists, including Borisov and Pyotr Aven, president of Alfa Bank, are honorary professors at the university, and pledged to take part in the new government-relations department.

TITLE: Chess Kings End Toilet Standoff
AUTHOR: By Carl Schreck
PUBLISHER: Staff Writer
TEXT: MOSCOW — It may sound like toilet humor, but for the chess world it was no laughing matter.Play resumed Monday after a dispute involving "dirty tricks" and allegations of cheating at the world chess championship currently taking place.
The championship, pitting Russian grandmaster Vladimir Kramnik against Bulgarian Veselin Topalov, was in danger, with Kramnik accused of taking a suspicious number of bathroom breaks.
Leading the match 3 games to 1, Kramnik on Friday forfeited game five to protest a complaint filed by Topalov's manager, Silvio Danailov, suggesting Kramnik was excusing himself improperly. The match is taking place in Elista, the capital of the republic of Kalmykia, located north of Dagestan.
The Russian was cited by Danailov for taking more than 50 breaks during one game in his private bathroom, the one area where the chess master is not under video surveillance during play.
Kramnik threatened to pull out of the match if his bathroom was not reopened and the game he had forfeited was not overturned. Topalov countered that he, too, would pull out if Kramnik's demands were met.
Kalmykia's president, Kirsan Ilyumzhinov, who is also head of the world chess federation, or FIDE, as its French acronym has it, rushed back from Sochi, where he had been at a conference with President Vladimir Putin, to save the match.
Negotiations ran late Friday. On Saturday, Ilyumzhinov announced a timeout between the players. A second timeout was announced Sunday, the first one having apparently expired.
Also on Sunday, Ilyumzhinov said in a statement that the match would resume Monday, but it remained unclear whether the two players had agreed to this and what the score would be. And the Kalmykian president said he had accepted the resignation of the three-man appeals committee that had closed Kramnik's bathroom, adding that, for now, he would rule on any disputes.
The media has dubbed the controversy "Toiletgate" and "Bladdergate."
In the complaint he filed with the appeals committee Thursday, Danailov did not explicitly accuse Kramnik of cheating, presumably with the help of a computer that would tell him the best moves to make.
But match officials were sufficiently alarmed to bar both players from their respective bathrooms.
"Topalov is outraged by the suspicious behavior of his opponent ... who in fact makes most of his significant decisions in the bathroom," Danailov said in a statement Thursday.
Oddly, given the insinuation that he was getting computer help, Kramnik made a blunder in game two that would have enabled Topalov to checkmate him in just two moves — if the Bulgarian had spotted the error. But he did not, and Kramnik ultimately won the game.
In response to the bathroom ban, Kramnik spent game time Friday lounging in his private room adjacent to the off-limits bathroom. Topalov waited at the chessboard for the Russian to show up.
Video surveillance broadcast on Russian television Friday showed the grandmaster laying on a couch next to the bathroom, occasionally crossing or uncrossing his legs.
After Kramnik had spent an hour of his game time nowhere near the chessboard, Topalov was awarded the game.
Kramnik then held a news conference at which he lashed out at the appeals committee for allowing Danailov access to videotapes of his private quarters.
"I did not sign the contract so I could act in a reality show," Kramnik said in comments broadcast on RTR-Sport television. "This goes against all ethical norms and violates my privacy."
In a statement released Friday, Kramnik's manager, Carsten Hensel, said Kramnik spent a lot of time in the bathroom because the adjacent private room is small.
"Mr. Kramnik likes to walk and therefore uses the space of the bathroom as well," Hensel said.
Danailov said in his statement that, if the match continues, Topalov would not be shaking hands with Kramnik before games.
The bathroom scandal threatens to derail a match that was to determine a universally recognized world chess champion after more than a decade of turmoil.

TITLE: Sochi Emerges as New Kremlin
AUTHOR: By Anatoly Medetsky and David Nowak
PUBLISHER: Staff Writer
TEXT: MOSCOW — Sochi is turning into the country's second capital in the twilight of Vladimir Putin's presidency.As of Thursday, the president, who is now in the Black Sea resort at his Bocharov Ruchei retreat, had spent 49 days there this year.
By comparison, he spent just 40 days lolling about in the sun in 2005, and only 24 days in 2004.
Indeed, Putin has inched ahead of the world's most famous vacation-seeker: U.S. President George W. Bush, renowned for his lengthy stays at his Crawford, Texas, ranch.
Just as Bush calls his Texas getaways "working vacations," Putin takes his work to the beach — conducting meetings with heads of state, Cabinet members and other officials.
On Thursday, for instance, the president met with Leonid Markelov, president of the autonomous republic of Marii-El, 860 kilometers east of Moscow. Earlier this year, he met with leaders from Spain, Armenia, Tajikistan, Uzbekistan, Kazakhstan, the Palestinian Authority, the European Union and elsewhere. In August, he met with members of the pro-Kremlin youth group Nashi.
But the president also spends a good bit of time in Sochi doing the things that people on vacation do — fishing off his boat, riding horses and swimming in the sea. "That shows he's in great condition," said a Sochi city government press secretary, who said he was forbidden from giving his name to the press. "The sea can get pretty cold."
Mullet and scad, a kind of mackerel, are the most popular catch in the waters off Sochi. "That's probably what Vladimir Vladimirovich fills his buckets with," the unidentified press secretary speculated.
Unlike former U.S. President Bill Clinton, known for strolling through the streets of another seaside resort — Martha's Vineyard — Putin is not fond of mingling with the masses.
Putin did make one well-publicized foray into Sochi in August, swinging by an agricultural exhibition hosted by town officials.
"We are always glad when he comes," said Yelena Markova, deputy director of Sochi's Sfera tourist company. "He is an advertisement for the city of Sochi."
Putin never holds up traffic, Markova said. The only nuisance comes when other senior officials visit him. Then police block traffic leading from the airport to the city, she said.
Still, there are a few telltale signs the president has arrived.
First, there's the long row of police patrol boats parked off the coast to guard him. Sometimes a navy destroyer takes part.
A fence separates Putin's beach from two sanatoriums, Markova said. A sign on the fence reads: "No Trespassing." A patrol boat not far away makes sure everyone plays by the rules, she added.
Not just anyone gets to vacation next door to Putin. One sanatorium, Salyut, is owned by the Interior Ministry; the other, Belarus, is owned by the Belarussian government, said Tatyana Skorokhod, director of another local travel agency, Flamingo.
The number of tourists surges when television shows Putin at the retreat, Skorokhod said.
Also, there's the helicopter, which has become more popular. "Putin flies in a helicopter more often than he used to, and more often than in Moscow," said Kommersant correspondent Andrei Kolesnikov, who has spent countless hours trailing after the president.

TITLE: Belarussian Orphan Girl Returned To Homeland After Weeks in Hiding
PUBLISHER: Reuters
TEXT: ROME — Italian authorities have returned to Belarus a 10-year-old orphan girl who had been hidden by an Italian couple who feared she would be abused if she were sent back to an orphanage in her home country.The girl disappeared more than three weeks ago, just before she was scheduled to return to the orphanage where the Italian family who hosts her each year for holidays believes she was sexually abused.
Her case has divided Italy and strained relations between the two countries, with Minsk complaining formally about what it called a "deliberate abduction."
Fearing that the girl — known as Maria in Italy to protect her identity and in Belarus as Vika, short for Viktoria — would be abused again if she returned home, Alessandro Giusto and Chiara Bornacin sent her to an undisclosed location Sept. 8.
On Wednesday, police found her near the northern city of Genoa and she was put under state care.
On Friday night the girl was flown back to Belarus.
"The girl has been returned to her homeland. Her fate will be decided by the Education Ministry," a spokesman for Belarus' Foreign Ministry said.
The couple, who speak of themselves as the girl's parents and had said they would rather go to prison than allow her to go back to Belarus, rushed to Genoa airport but were too late.

TITLE: Vodka Giant Has Capacity to Set Standard
AUTHOR: By Yekaterina Dranitsyna
PUBLISHER: Staff Writer
TEXT: A leading Russian premium vodka producer, the Russian Standard Company, officially opened a new distillery in the city on Sunday, signaling its general expansion into new markets.Located on Pulkovskoye Shosse, in the industrial zone where Wrigley and Coca-Cola plants are already based, the new distillery will produce 3.6 million decaliters of vodka annually. Russian Standard invested $60 million into the project.
"The construction of this new distillery and our aggressive international expansion are a direct result of the popularity and demand for our products across the globe," Rustam Tariko, head of Russian Standard Company, said in a statement released Sunday.
"We are now one of the few privileged vodka companies to own our own distillery, allowing us to meet global demand while maintaining our superior craft of Russian vodka. This new distillery will strengthen our leading position in Russia and allow us to accelerate our aggressive global expansion," Tariko said.
By opening the 30,000 square meter distillery Russian Standard doubled its capacity. The distillery will handle production of the company's entire vodka portfolio — Russian Standard Original, Russian Standard Platinum and Imperia.
According to the company's estimates, Russian Standard holds over two-thirds of the premium vodka market in Russia. The company sells over one million cases per year inside the country alone.
So far Russian Standard exports to 28 countries including Austria, Denmark, Finland, France, Germany, Bulgaria, Estonia, China, Cyprus, Greece, India, Israel, the U.K. and the U.S.
By doubling its production volume Rustam Tariko plans to launch Russian Standard Original in the United States and in new European and Asian markets.
Maxim Chernigovsky, executive director of the St. Petersburg Club of Alcohol Market Professionals, suggested that the announced production volume was extraordinarily high. It is comparable to the capacity of the largest alcohol producer in Russia, Veda, which annually produces eight million decaliters.
However Chernigovsky said that the new plant would hardly affect Russian Standard's market share and sales volume in Russia.
"Every month Russian Standard produces around 50,000 decaliters of vodka under its own brand in Russia. And sales of this rather expensive brand have remained stable over the last five years to six years," Chernigovsky said.
He suggested that the new plant will be used to launch new brands and to produce vodka by order.
So far Russian Standard has orders for vodka production from Liviz, a St. Petersburg-based alcohol plant. Chernigovsky saw the main reason for launching their own plant as increasing control over the production process.
"It is easier and more profitable to produce a brand at the company's own plant than ordering production from elsewhere. It simplifies control and diminishes risks," he said.
Another expert was more optimistic.
"One of the major trends in the alcohol market is the fast growth of the premium segment, seen over the last few years. By opening the new plant Russian Standard will increase its sales volume," said Mazhkur Gasymov, chairman of Vilazh vine plant. "The other trend is ongoing consolidation of the alcohol market, and Russian Standard's plans are quite normal for such an environment," he said.

TITLE: Vedomosti Goes WAP
AUTHOR: By Yekaterina Dranitsyna
PUBLISHER: Staff Writer
TEXT: The largest Russian cell phone operator, MTS, in cooperation with Independent Media and the i-Free mobile content provider, has launched mobile access to Vedomosti daily on MTS WAP portal, the company said last week in a statement.The WAP version is identical to the hard copy with the exception of adverts. In designing the service, i-Free took into account all handset models currently circulating in Russia.
"We tried to make the service of maximum convenience to any subscriber, regardless of his personal technical preferences," said Kirill Gorynya, i-Free CEO.
Access to a fresh issue costs 16 rubles ($0.6) plus VAT, while subscription is roughly equal to the normal tariff. Access to the newspaper and its archive is available in full and part time versions.
Pavel Roitberg, director for product and service development at MTS, saw such a version of the newspaper as "convenient for many business people, especially for those who are abroad and have no opportunity to read a hard copy."
"That's why we are confident that a mobile version of Vedomosti will be in demand, and also because the subscription cost will be comparable to buying a hard copy," Roitberg said.
WAP provides 15 percent of all profits that MTS earns from SMS services, said Kirill Alyavdin, MTS press secretary.
"About 20 percent of WAP users read the news, so we expect that between five percent and seven percent of them will become constant subscribers to the newspaper," he said.
MTS expects the subscription to increase WAP portal profits by 20 percent to 30 percent within a year, Alyavdin said.
MTS plans to launch similar projects with other business and entertainment editions after "tackling some technical issues."
The company is targetting one of the fastest growing markets. According to a report by ComNews Research, in the first half of 2006 the value added services market increased by 36 percent up to $882 million and keeps growing.
By the end of 2006 revenue from non-voice services is expected to exceed $1.5 billion.
The mobile internet was the most rapidly growing — it increased by 73 percent. By the end of 2006 ComNews Research expects this market to reach $380 million. During the last year the number of WAP users doubled. At the moment they account for 87 percent out of 16 million internet users.
"Development of telecommunication devices allowing WAP is a strong factor for mobile internet market development," the report by ComNews Research said.
Next year value added services are expected to increase by 30 percent to 40 percent, which is fairly high growth, the report said.
Another expert was less confident about the project's success.
"Many Russian editions have WAP versions, but in most cases these are image-related and aim at increasing exposition to the target audience. So far there have been no commercially successful projects of this kind," said Maxim Muchkayev, leading analyst of J'son & Partners.
Muchkayev said that SMS-subscription would scare off some users. "It is more convenient to charge the payments online using WAP-click technology. However MTS has not yet offered this option for its clients," he said.
Muchkayev indicated that there is already an easier way to get mobile access to the internet. "The free of charge web-browser Opera mini allows the reading of WAP pages. It can be installed in any handset that has a color display that supports Java2ME technology," he said.
In this case the user does not pay for subscription and the cost of data traffic is significantly reduced, Muchkayev said.

TITLE: Local Graduates Gather To Gain From Close Association
AUTHOR: By Yelena Andreyeva
PUBLISHER: Special to The St. Petersburg Times
TEXT: In most Western universities the tradition of Alumni clubs has been kept alive for years, even centuries. Such organizations are relatively new in Russia but they are in the process of rapid development. The Alumni Association of the Faculty of Management of the St. Petersburg State University is one of the largest and most successful among the city's alumni clubs.Founded in 2001 as a non-commercial organization, the association joins together around 1,200 to 1,300 members — the graduates of the day and night departments, the MBA and Presidential programs.
"Five years ago we started the association from scratch — we had neither experience, nor any good examples to follow," said Yelena Streltsova, president of the Alumni Association of the Faculty of Management. "It was not easy to work it out but eventually we succeeded."
Now, the Alumni Association has a clear and well-organized structure and is run by the Alumni Association board comprising some 30 people representative graduates from all the departments and programs of the Faculty of Management, as well as the students who actively participate in the work of the association. The association's committees run a range of educational and entertainment activities for its graduates.
The strategic committee operates the strategic development of the association, with projects aimed at the maintenance of professional skills. They include different round tables, seminars on management, marketing, finances, interactive discussions and lectures, consulting and training sessions and a summer school.
Most of the educational classes are free and gather together graduates eager not only to get new knowledge but to share their professional experience with colleagues.
"Such sessions are very useful and valuable for our graduates who usually meet like-minded people with the same educational background, speak the same "professional" language and know all the management terms," said Tatiana Nistratova, head of Alumni Relations, executive director of the Alumni Association.
"Above all, our graduates often find new business partners and even a better job."
Most of the graduates are highly qualified professionals who work in top and middle management and, although short of free time, cannot lose a chance to participate in association events.
For example, Streltsova combines her presidential duties at the Alumni Association with the work as general director of the confectionary factory Lubimy Kray.
"As the president of the association I need to take part in a range of events and it is really interesting for me," she said. "When I want to launch a new business project, I first read all the books on the topic and then look for experts among our graduates. Nothing compares with such an effective interchange."
However, the members of the association not only have the thirst for knowledge, they also know how to have fun. The committee on communication and leisure always holds a range of events, including parties, sports events, such as bowling or paintball, and theme nights.
www.somunity.ru
www.som.pu.ru

TITLE: University Sets Dual Course
PUBLISHER: The St. Petersburg Times
TEXT: The Department of World Economy at St. Petersburg State University announced that they have been awarded BRIDGE project funding by the British Council to develop a new dual-award course in Russia, in partnership with the Nottingham Business School (NBS), Nottingham Trent University, UK.The new joint MSc program "Strategic Entrepreneurship in the Global Economy" appeals to both entrepreneurs and middle managers, either self-employed or working in a corporate context, who want to develop their professional skills in order to build a successful career. All the lectures and seminars will be given in English by British and Russian teachers.
On graduation, students will receive both a Russian and a UK award. The deadline for applications is Oct. 13.
www.worldec.ru

TITLE: TNK-BP Engineer Ziganshin Shot Dead
PUBLISHER: Bloomberg
TEXT: IRKUTSK — Enver Ziganshin, the chief engineer of BP's Russian gas unit, Rusia Petroleum, was shot and killed in Irkutsk on Sept. 30.The Irkutsk prosecutors are investigating whether the murder was a contract killing related to Ziganshin's work, Interfax reported. TNK-BP, half-owned by BP, owns 63 percent of Rusia Petroleum, which is developing the $18 billion Kovykta natural-gas project in Irkutsk, Siberia.
TNK-BP spokeswoman Marina Dracheva confirmed the report that Ziganshin was shot and referred other questions to Rusia Petroleum. Rusia Petroleum spokesman Yuri Shestakov wasn't available to comment when called on his office phone.
The Natural Resources Ministry plans to review Rusia Petroleum's compliance with its license to the Kovykta field and with environmental laws, Minister Yuri Trutnev said Sept. 26. The Russian Prosecutor General's Office said earlier that Rusia Petroleum may lose its license over operational and environmental violations.
Kovykta holds 2 trillion cubic meters of gas, enough to power Asia for about six years.
Rusia Petroleum is unlikely to supply 9 billion cubic meters of gas to the local market starting this year as required by its license, Trutnev said. TNK-BP filed to defer the start of full output to 2009, Natural Resources Ministry official Anatoly Ledovskikh said May 31.
Russia has previously threatened to revoke drilling licenses held by Rusia Petroleum for Kovykta, eastern Siberia's largest gas field, unless the venture comes to an agreement with Gazprom on the pace of the field's development. Gazprom, which produces the majority of Russia's gas, is developing a competing project to supply fuel to the Irkutsk region.

TITLE: New Antitrust Rules Give Watchdog Monopoly Bite
AUTHOR: By Simon Shuster
PUBLISHER: Staff Writer
TEXT: MOSCOW — New antitrust regulations that go into effect Oct. 26 will define more tightly what counts as monopolistic practices and allow the federal antitrust watchdog to go after cartels for the first time.Andrei Tsyganov, deputy head of the watchdog, the Federal Anti-Monopoly Service, expressed optimism that the new 170-page legislation would help curb price-fixing and other crimes of collusion.
"Only the balance of supply and demand should determine price," Tsyganov said late Thursday at a conference of lawyers and businessmen. "Whenever the price stands above that point, we can accuse [companies] of monopolistic practices."
He conceded, however, that his agency "has so far been fairly ineffective at calculating where this price level should lie" — a failure which bodes poorly for antitrust enforcement.
More generally, his approach to trustbusting promises to be passive.
"Raiding offices and seizing file cabinets is not all that effective," he said in an interview. "You waste a terrible amount of resources that way."
It is better, he said, to allow the heads of business to come directly to the Federal Anti-Monopoly Service, explain how they operate, and then, if necessary, be told how to come into compliance with the new laws. He said he had faith in the will of companies to do so.
In 1991, when the current antitrust laws were written, monopolies were viewed as a rapid way to privatize and consolidate shattered industries, and the laws against them were kept almost entirely toothless. No one has ever been convicted of breaking them.
But since nearly all of the old provisions will remain in effect, the new laws fail to meet the World Bank's call to enact entirely new legislation.
"The old laws remain a strong basis for antitrust enforcement," Tsyganov said. "The new laws add provisions to address recent developments."
One key provision will allow the service to go after cartels, or companies with "collective dominance," for the first time. Another introduces into law the notion of vertical integration, a generally unlawful arrangement in which a single company controls every stage of making, selling and delivering a good.
The threshold for what counts as market dominance will also be dramatically lower. Instead of a 65 percent market share, 50 percent will now "ensure a visit" from the service, Tsyganov said.
But, as he was also careful to point out, a dominant position is not necessarily against the law. It only means greater scrutiny of the company's accounts.
The range of companies subject to such scrutiny has been slashed under the new regulations. "If before the FAS inspected 90 percent of all companies, it will now inspect only 10 percent," Tsyganov said, pledging to focus on major industries such as telecoms, oil and gas.
But the owners of these industries, including members of the Russian Union of Industrialists and Entrepreneurs, will not be hit by surprise. They participated directly in drafting the new rules.
But asked if they had been successful in influencing them, Tsyganov said, "No, not really."

TITLE: Belarus Lets out Gas Warning
PUBLISHER: Combined Reports
TEXT: MINSK — Belarussian President Alexander Lukashenko threatened on Friday to sever all relations with Russia if Moscow sharply hiked gas prices for Minsk.He also warned that a merger of Belarus with Russia could lead to violence and disorder worse than in Chechnya.
Lukashenko's blunt remarks highlighted rising tensions between the two countries amid strained talks over natural gas prices, which Gazprom has threatened to quadruple from next year.
"A price hike to such levels would mean full severance of all ties, particularly in the economy," Lukashenko told Russian journalists at a four-hour news conference broadcast live by state radio. "We will survive, but you will lose the last ally. You will simply lose face."
Moscow and Minsk signed a union treaty in 1996 that envisaged close political, economic and military ties, but stopped short of creating a single state. The Kremlin, increasingly impatient about subsidizing Belarus' economy with cheap gas, has since proposed that Belarus be absorbed into Russia.
Lukashenko, who has vehemently opposed such a union, reiterated his stance. "Even Stalin didn't go as far as that. ... I don't want to be the first and the last Belarussian president," he said.
He said its incorporation into Russia could trigger chaos and even fighting.
"As soon as Belarus becomes part of Russia, it'll be worse here than in Chechnya," he said. "We'll have people coming in from Georgia, from Russia, Ukraine, Poland and the Baltic countries. They are ready today to come with weapons."
Gazprom says it will increase prices if Minsk does not cede control of its gas pipelines. Minsk has rebuffed the offer.
Belarus pays some $47 per 1,000 cubic meters of Russian natural gas, while Gazprom wants to boost prices to about $200, saying concessions on pipeline ownership would cut this tariff.
Lukashenko said he was ready to swap a 50 percent stake in Beltransgas, the state company managing the pipeline network, for the right to extract at least 10 billion cubic meters of gas in Russia annually.
(Reuters, AP)

TITLE: Having the Confidence to Develop Your Personality
AUTHOR: By Olga Kalashnikova
PUBLISHER: Special to The St. Petersburg Times
TEXT: Hotel, restaurant, tourist company, school of foreign languages and international center of culture and science — all these different branches of business are united in just one company, Swiss Center Inc.That's how it all stands today for Swiss Center's chairman, Yunis Teimurkhanly, but back in 1993, as a graduate from the Oriental department of the St. Petersburg State University, he just had an idea, the desire to make it work and self-confidence.
Teimurkhanly and the Swiss Madeleine Isabelle Luethi, now president of Swiss Center Inc. wanted to create a small company to welcome foreign tourists.
Everything was new in modern Russia's time of troubles, but in spite of his youth Teimurkhanly had already understood what he wanted from life.
Their first venture involved special cultural projects with Swiss tourists.
"So the company Swiss Center Inc. emerged, using our flat as an office," said Teimurkhanly.
What soon became clear to the young entrepreneur and his partner was the city's distinct lack of accommodation for foreigners. Because of the insufficient number of quality hotels, tourists were forced to stay in private homes.
"These were our first steps. From there we got the idea of establishing the hotel. We felt that combining accommodation with other aspects of tourism was an interesting business idea," he said.
Teimurkhanly knew the way to go to start shaping himself and his business. And in 1998, the year of Russia's default, the partners started to negotiate with foreign creditors and investors on a project for a future hotel.
It took a lot to convince foreigners to invest in a Russia in crisis.
Finally, in 2000 the partners began to resettle the old tenants of a building built by Swiss architect Augusto Lange in the middle of the nineteenth century.
It was an ill-assorted selection of communal flats, inhabited by hard up families and senior citizens. It needed a complete overhaul.
"The process was long, hard and somber. Investment by investment. Flat by flat. We believe that we improved the living conditions of many families," Teimurkhanly said.
Giving help was important, but so too was the example the partners set to other foreign companies. The capital of the Swiss Center Inc. is mixed: both Russian and foreign.
"We show that one can and should deal with Russia. One can take risks, invest in Russian business — one shouldn't be afraid," he said.
Teimurkhanly himself is not afraid to take risks and try out new business ideas. In 2003, for example, the hotel "Helvetia" (Switzerland in Latin) was launched.
"Business is like a personality, it should live and constantly develop otherwise it loses competitiveness on the market."
And Teimurkhanly never comes to a standstill. He and Luethi seek to expand their business but not through simply opening another hotel, as one might think.
Swiss Center's next project was in fact a restaurant called Marius Pub.
"It is the first gastro-pub in St.Petersburg," he said. "One can have not only a drink but also a good meal. Such a concept is popular in Great Britain right now — combining the atmosphere of a pub with good cuisine."
In 2007, the company is planning to open another restaurant and a cocktail bar, which will serve both hotel guests and city dwellers. At the same time the once small tour company has become Rustravel, specializing in entry tourism.
"These are mostly individual tours. We show our guests a side of city life that is often not available on package tours, such as communicating with local people, Pushkin's Petersburg, restoration workshops or modern architecture," Teimurkhanly said.
Swiss Center has found that many foreigners are interested in studying Russian language and culture. The International School of Languages, aimed at foreign and Russian students, is another facet of the company.
When Teimurkhanly and his team assimilate one business area, they are interested in dealing with another, regardless of the difficulties. That's why the company has so many different aspects.
"Business is like a child. When you start it from nothing it is like bringing up a child. If your child is successful, develops and grows as you want, if you put a lot into your child and see efficiency, then you are glad. It is the same with business — it can inspire you to develop and achieve more in the future."
The main secret of such success is a sense of purpose and self-confidence.
"Purposefulness and a liking for hard work. I think it guarantees success. There are many talented, clever people who do not achieve anything," said Teimurkhanly. "I am workaholic, I feel a vital need for work," he added.
However, business changes a man in different ways.
"You become rigid and fair. It is not excused as cruelty but rigidity, which is a sort of answer to unfairness, sometimes it has an influence on you private life. Business forms a man."
The last division of Swiss Center Inc. is the international center for cultural and scientific collaboration, Helenica, controlled by Luethi, former Honorary Consul General of Switzerland in St. Petersburg.
"We have four branches of business and one that inspires our organization," said Teimurkhanly. Among Helenica's projects are educational programs and contributions to the city's museums, archives and libraries, as well as to charity.

TITLE: Tengiz Field is the Edge of the Caspian and the World
AUTHOR: By Maria Golovnina
PUBLISHER: Reuters
TEXT: TENGIZ, Kazakhstan — The Tengiz oil field in Kazakhstan is a blend of Western corporate culture and old Soviet ways — even through it's been years since U.S. oil firm Chevron came to develop it.Cheerful slogans like "Be a winner!" and "Lead a healthy lifestyle!" have replaced Soviet propaganda posters on the walls, and English is heard here as often as Kazakh or Russian.
And yet it is one of the world's most desolate corners — scorching hot in summer and life-threateningly cold in winter — and a stiff wind blows year-round. The closest town is a 45-minute flight on a rickety propeller plane.
"This is like the edge of the world," said one worker from India. People call it the Wild East.
Geologists discovered oil in this part of the Caspian Sea in 1979. Two years after the Soviet Union crumbled, Chevron moved in to extract oil from its wells together with Kazakh state oil company KazMunaiGas and other firms.
"Back then it really wasn't pleasant here at all," said Steve Green, a services administration manager from Britain. "There's been a certain amount of Western influence since I first came here in 1994."
Tengiz is one of the world's biggest oil fields. Its expansion has contributed to an oil-fueled boom in Kazakhstan's economy. Kazakh President Nursultan Nazarbayev, who has run the Central Asian state since 1989, is said to be personally supervising the project.
In the nearby town of Atyrau, the country's so-called oil capital, sleek skyscrapers, luxury hotels and fenced "cottage" villages for foreigners lie alongside dismal Soviet-era buildings, dirt streets and one-story houses where Kazakh families live.
Many local residents who have missed out on the oil boom complain they are not seeing any benefits.
"Teachers here get $100, and we all know how much people are getting paid up there," said one Atyrau resident who works in a Soviet-era sanatorium.
Residents also complain about cash being channeled toward construction of Kazakhstan's new capital, Astana, instead of helping reduce poverty in Atyrau.
At Tengiz, it's business as usual. A big pump station towers high above the steppe, its metallic surface gleaming in the sun.
This is where the Chevron-led Caspian pipeline starts. It takes crude across the steppe along the muddy shore of the Caspian Sea to faraway markets in the West.
Surrounded by a bleak steppe for hundreds of miles, Tengiz is a 4,100-square-kilometer labyrinth of shiny pipes and production facilities.
Tengiz, which means "ocean" in Kazakh, has potential estimated recoverable reserves of up to 9 billion barrels, according to Chevron.
It employs 3,500 people and up to 13,000 contractors working on a new, $5.5 billion project to double oil production in the coming years. Around 20 percent of the work force is foreign.
Foreign workers brought everything with them: from recipes to production standards to a widely manifested obsession with workplace safety — a regulation often ignored in Soviet-era plants, where work-related fatalities are commonplace.
"How am I driving?" asks an English-language poster inside a Tengiz bus. For those who want to lodge a complaint, there is a telephone number below the sign. All the workers have to carry around a respirator in case of a gas leak.
In a workers' canteen around the corner from the pump station, Kazakhs, Americans and Europeans all eat together. The menu is diverse: sandwiches and vegetarian meals are offered alongside starchy dishes preferred by many in the former Soviet world.
"Initially foreigners ate only sandwiches. And the locals laughed at them," said a Kazakh canteen worker, smiling.
"But now everything is mixed up. Many Kazakhs eat sandwiches, and expats love Russian soups and hot dishes."
Yet, some foreigners are less than beloved by the place.
"Being here is something you put up with," said Brian Fox, an operations manager from Britain. "This is not the best place to be in the world. There is one reason we are here — it's money."

TITLE: Oil Output Sees Little Change Despite Drop in Price
AUTHOR: By Garfield Reynolds
PUBLISHER: Bloomberg
TEXT: MOSCOW — Russian oil output was little changed in September, as world prices fell and the government threatened to halt work at a Royal Dutch Shell Plc project, the nation's biggest foreign energy investment.Average daily oil output during the month was at 9.751 million barrels a day, or 39.91 million tons, compared with 9.759 million barrels a day in August, according to the Energy and Industry Ministry's CDU-TEK unit. Exports rose 50,000 barrels a day to 5.45 million barrels a day, little changed from a year earlier.
Crude oil futures have dropped 18 percent in New York since touching a record $78.40 a barrel on July 14, the highest since the contract began trading in 1983.
Shell's $22 billion Sakhalin-2 project would have to stop building key pipelines if Russia's Natural Resources Ministry decides this month to cancel a construction permit. Shell and Japan, developers of the Sakhalin-2 fields in the Sea of Okhotsk, have rebuked Russia for threatening to halt the project, citing "abnormal'' and "one-sided'' demands. Japan will also be one of the biggest consumers of the project's fuel.
The pipelines will carry oil and gas to the southern tip of Sakhalin island to ensure year-round exports. The Shell-led Sakhalin Energy Investment Co. is building a plant there to cool natural gas to a liquid state for shipment by tankers starting 2008. It has contracts to sell about 98 percent of its liquefied natural gas output, mostly to customers in Japan and Korea.Exports to countries outside the Commonwealth of Independent States totaled 4.49 million barrels a day, up 1.1 percent from August.The CIS comprises the former Soviet states, except for the three Baltic republics.
Shipments to refineries in Belarus, Kazakhstan and Ukraine jumped 17 percent to 820,000 barrels a day from 700,000 barrels a day in August. Exports outside the Transneft system plunged 56 percent in September to 140,000 barrels a day, from 250,000 a day in August.
Production rose 2.3 percent from a year earlier.
Lukoil, Russia's biggest producer, boosted extraction 5 percent to 1.85 million barrels a day, compared with the same period last year.
Rosneft, key to President Vladimir Putin's plans to increase the government's role in the energy industry, raised output 16 percent to 1.77 million barrels a day, taking the company past BP Plc's TNK-BP Holding venture to become Russia's second-biggest oil producer. Rosneft last month started operating Udmurtneft, acquired this year from TNK-BP.
The BP-led venture's output dropped 11 percent from September 2005, to 1.61 million barrels a day. That was also a 6.9 percent decline from August 2006.Exxon Mobil Corp.'s Sakhalin-1 venture off Russia's Pacific coast slashed output by about 60 percent to 24,200 barrels a day, from 38,500 a day in August, according to CDU-TEK.
Output at fields run by so-called production-sharing agreements, such as those covering Exxon Mobil's Sakhalin-1 and Shell's Sakhalin-2, fell 12 percent to 128,900 barrels a day.

TITLE: Court Move Is Thoroughly Well-Judged
AUTHOR: By Anna Shcherbakova
TEXT: Sometimes I envy the Constitutional Court judges who, according to Vladimir Kozhin, head of the department of Presidential affairs, are due to move to St. Petersburg by 2008. The decision to move this important but compact institution from the Southern Capital to, well, the Northern one, was announced at the end of last year.Moving should give more independence to the Constitutional Court as well as more importance to St. Petersburg, the president's hometown.
As a former capital, St. Petersburg was designed with the functions of power in mind — the abundance of representative buildings was the argument put forward by city governor Valentina Matviyenko, who has promoted the idea of a political power share between St.Petersburg and Moscow from the very beginning of her term.
She may be right, but one should add that most of these buildings are in very bad shape. The president's allies know what to do: give them all a complete makeover.
According to a decree signed by the prime minister, within two years the state budget will allocate 5.3 billion rubles (about $200 million) to renovate a building on the Neva river near Dekabristov Square (where the Constitutional Court will be located). These funds will also pay for the two luxury residential complexes: one on Krestovsky island where the judges will reside and another on the coast of the Gulf of Finland, where they'll be able to escape the city for a break. In view of the amount of funds allocated, this real estate should lavishly cater for each of the 19 judges' every possible need.
This is why I envy them, despite the fact that more of them aren't keen on moving from Moscow to St. Petersburg. According to Kozhin, it is unlikely that all the Constitutional Court's staff will agree to move, but a residential building is planned for them nonetheless.
Construction companies would of course be very happy to participate in the 5.3 billion-ruble contract, but according to real estate experts, expenses are looking somewhat exaggerated. In addition, there is no risk of late payment, as when the Constantin Palace in Strelna was raised from ruins to a Presidential residence and international congress hall before St. Petersburg's 300th anniversary. The budget for the project was over $300 million, but its general contractor, 16th Trust, went bankrupt because of uneven financing. However, the Constantin Palace was sponsored by businesses, who were asked by Kozhin and his colleagues to help. Money was collected in a special fund that was then distributed to the constructors. According to industry rumors, the last installments were in fact never paid.
This time everything will be different. The Court is backed by the federal budget, and it is safe to participate, experts say.
No one knows who will be in power in 2008 when the buildings are due for completion. Instead of the judges, there might be some other group of people tempted to move from Moscow to brand new accommodation in St. Petersburg.
And so money flows into the city, just like in the good old days, when St. Petersburg was capital of the empire. Old buildings will be renovated and new ones built, regardless of who the resident will eventually be.

Anna Shcherbakova is St. Petersburg bureau chief of business daily Vedomosti.

TITLE: UES Reform Needs Kremlin
AUTHOR: By Gianguido Piani
TEXT: As the cold season approaches, the national electricity holding, Unified Energy Systems, has announced that several regions could face disconnections, blackouts and shortages in the delivery of heat and electricity over the winter. This is hardly a surprise, given that most of its equipment is obsolete and should have been replaced a long time ago. This state of affairs, however, has been worsened by two flawed strategies pursued in recent years by the electricity monopoly. The country must now pay the price.The first questionable strategy was the creation, not yet completed, of an electricity market with the declared goal of lowering electricity costs and of attracting fresh investment. Replicating similar reforms in other countries, power plants and distribution grids have been "unbundled." They must run independently and use so-called "price signals" to coordinate their work.
Electricity markets, however, have yet to demonstrate anywhere the ability to attract large-scale investments. The markets are designed for short-term operation, while capital-intensive power systems can only offer profitable returns over the mid- to long-term. So far, only gas-powered generators have been built under the new market conditions because they are cheaper than coal, hydro or nuclear plants, and take less time to install. In the West, the predictable result was that increases in gas prices wrecked the whole economy of gas-powered electricity generation. The negative effects of this shortsighted approach were already visible in California in 2000 and 2001 and became evident last winter in several parts of Europe. Even the pro-market International Energy Agency (IEA) had to admit that "the biggest challenges remain ahead." To redevelop synergies, many Western power generating companies are now merging again with retailers to form vertically-integrated companies. This is the most natural structure for power systems, contrary to the very idea of unbundling.
The second strategic mistake by UES is to focus strictly on replacing generation assets instead of carrying out a general optimization of the grossly oversized heat and power system. Conservative estimates put heat consumption at twice the necessary levels, even under the country's hard climatic conditions, and electricity demand at 20 to 30 percent above what should be required. About half of all heat generated for residential consumption is lost along leaking pipes or through poorly insulated building walls. Considering gas-powered heating alone, it can be assumed that 75 billion cubic meters of natural gas are burned each year just to make up for these losses — an amount roughly equivalent to the total annual gas consumption of countries like Germany or Italy.
The potential for energy efficiency is enormous, not based on science-fiction solutions, but with plain technologies already proven and used in other parts of the world. Energy-efficiency measures, however, are difficult to implement because they are not centralized, take time and patience and, most of all, have to be coordinated in different sectors of the economy. These initiatives are therefore best approached institutionally and not left to market mechanisms alone. In a report published in 2003, the IEA itself indicates that "one of the lessons of liberalized power markets is that current market designs do not support savings actions by customers." But it was thanks to energy-efficiency measures that the effects of the 2000-2001 California blackout, the New York power network overloads of last summer and other dangerous situations could be mitigated relatively quickly. In a recent example, Moscow Mayor Yury Luzhkov proved his energy savvy by proposing to make an extra 88 megawatts available on the city's grid — not by building a new power plant, but by installing two millions low-consumption lamps, which, incidentally, also cost much less.
The systemic inefficiencies in Russia are possible only because the internal prices for energy carriers are kept artificially low by public subsidies. Full price liberalization is not yet possible, out of concern over its negative economic and social consequences. But these low prices make the financing of energy-efficiency solutions particularly difficult. To break out of this Catch-22, the very resources sustaining this situation should be redirected into the necessary investments. This means recognizing the role of public financing.
Somebody must also step in to promote efficiency, and power companies are the most natural candidates for the task. The power company Energie Baden-Wßrttemberg has recently declared energy efficiency its primary economic interest. Other foreign utilities, for example Germany's E.On and Italy's Enel, already run energy efficiency operations to help customers use less energy. In these programs, profitability is ensured not by charging for the energy consumed, but by linking the tariffs to a baseline of what the customer would have paid without the efficiency interventions. A reference price that covers project expenditures and is profitable for both buyer and seller is then established and charged until the investment is paid back. By its very nature, this approach requires planning over a temporal horizon of five to ten years and, consequently, is not compatible with the power markets and their short-term volatility.
If the UES reform is carried out as planned, and provided that sufficient capital is raised for modernization, new power plants will be built to replace the old ones. But if nothing is done on the demand side, the new plants will be just as oversized as the old ones, consuming much more coal, oil or gas than necessary. Russia will be stuck for decades with a modernized but oversized and inefficient power system, making its industry less competitive internationally. Huge quantities of fossil fuels that could have been exported will not be available because they will necessary at home. UES policies therefore also have consequences also for other national companies that would rather pursue different strategies.
Russia cannot afford to experiment with the plausibility of market theories. It needs electricity and heat, and it needs them now. One way or another, the state will end up covering a large part of the bill for the modernization of the power system. As the majority shareholder, it should have more say in UES strategy. It is high time for the state to lay out its position loud and clear.Gianguido Piani is an independent energy expert based in Italy and St. Petersburg.

TITLE: The Time Has Come to Renegotiate PSAs
AUTHOR: By Konstantin Sonin
TEXT: Two leading financial newspapers, the Financial Times and The Economist, wrote last month that the "environmental attack" on Shell, the main stakeholder in the Sakhalin-2 project, had been brought about by Russia's desire to bring foreigners to the negotiating table. This was a logical conclusion.Both newspapers also wrote that the government's response was misguided, but here they missed the mark. Of course, both the method of initiating negotiations — using the Prosecutor General's Office — and the decision to have Gazprom manage the state's (future) share in the project are bad news. But the government's intention is correct. The time has come to renegotiate its production sharing agreements.
Transferring part of the Sakhalin-2 project to Gazprom is obviously a mistake. The project needs investment, and Gazprom is already struggling to fund such long-standing projects — in the Yamal-Nenets autonomous district, for example. Figures from the Institute for Energy Policy show that extraction has been falling for some years.
If the idea is to provide political oversight of Sakhalin-2, it remains unclear what Gazprom has done to demonstrate its reliability in defending the interests of the state. Why the production sharing agreements should be renegotiated is a more complex question. The idea behind the agreements is that they provide investors with additional security against political risks. This explains why they have been implemented so widely, from Soku's Zaire to Iraq in the post-Hussein era.
In 1996, the government decided that the large investment it needed could only be protected by signing a production sharing agreement. Ten years later, however, Russia does not need to offer such guarantees to investors. BP, which controls half of the British-Russian joint venture TNK-BP, has a greater interest in seeing Russia observe international intellectual property law than companies that are protected by production sharing agreements.
The point is not that BP is in some way better or more conscientious than Shell. Both companies aim to generate maximum profits, and their main operation has long been managing political risks in petro-states. Yet a foreign company that enjoys no particular advantages will become a stakeholder — you could even call it a hostage — in the country where it is doing business, whereas a company with special advantages will not.
The European Bank for Reconstruction and Development a co-investor in Sakhalin-2 whose mandate for the project includes not just maximum profits but promoting the development of market institutions — made a mistake by supporting production sharing agreements. The best way to correct this would be to assist in the reconfiguration of the Sakhalin-2 consortium as a firm working by the same rules and laws as other Russian firms.
Shell, meanwhile, should revisit its motives for entering into the agreement in the first place. Treating Russia as a volatile third world country with nuclear weapons is not a good basis for doing business. Production sharing agreements shelter investors from many political risks, such as military coups and major changes in domestic policy. But Shell failed to take into account another sort of political risk: that the country might recover from the economic shocks of the 1990s much more quickly than expected. Maybe they will have better luck next time, in another country.

Konstantin Sonin is a professor at the New Economic School/CEFIR.

TITLE: Learning From Eye Contact
AUTHOR: By Richard Lourie
TEXT: U.S. President George W. Bush famously looked into President Vladimir Putin's eyes. But Putin's eyes were looking back. He has never said what he saw, but judging by his actions, it must not have been very attractive. Whatever the case, it kept him from making mistakes like those of Britain's unfortunate prime minister, Tony Blair, who apparently went too far in heeding Winston Churchill's advice to cling to the British-American alliance at all costs. Those costs now include Blair's career.Blair may have deluded himself that he could exert a positive, civilizing influence on Bush — a belief the Greeks held when they fell under Roman sway and which the Polish intellectuals adopted when they came under Soviet domination, as detailed in Czeslaw Milosz's classic "The Captive Mind."
But there is no evidence of Blair having any such influence on Bush. On the contrary, the Brits, who have a long history of operations and relations with the countries of the Middle East and Central Asia, seemed to have forgotten everything they knew about the damnable complexity of these places. More than 150 years after the slaughter of the British army in Kabul — out of 17,000 soldiers, just one stumbled out alive — British soldiers are still dying in Afghanistan and in the Iraq they helped gerrymander into existence. (Beware of any Middle Eastern country with straight lines for borders.)
Part of the problem is illuminated in "Murder in Samarkand" by Craig Murray, who was Britain's ambassador to Uzbekistan from 2002 to 2004. A feisty Scot and a most undiplomatic diplomat, Murray couldn't help but fight openly against the most glaring instances of injustice that he saw around him. And he may well have done more good by his protests than is usually accomplished by behind-the-scenes diplomacy. But what made Murray such a "deep embarrassment," as Britain's former Foreign Secretary Jack Straw called him, was that he made no secret of his belief that the regime of Islam Karimov in Uzbekistan was no ally for the U.S. and Britain. "The British government didn't want U.S. policy balanced," he writes, "they wanted it unquestioningly backed. This was the War on Terror, black and white, with us or against us."
Wars on abstractions always fail. The War on Poverty. The War on Drugs. And now the War on Terror.
Putin has not been greatly hurt by any of this and has in fact rather benefited from some of it. Murray characterized the absurd ironies of the alliance with Uzbekistan as follows: "The most reactionary Republican administration in history was giving very active assistance to the group of Soviet apparatchiks in power in Uzbekistan, who were striving with some success to preserve the last remnants of Soviet communism." This relationship was bound to come back to haunt them, which it did over the slaughter in Andijan last year. The net result was that the United States disgraced itself with its alliance with Uzbekistan and lost its bases there. In the end, Uzbekistan ended up closer to Russia, which had hardly been Karimov's original intention.
Putin has apparently been successful in his own domestic war on terror, having hunted down Shamil Basayev, his bin Laden. Basayev had besmirched the cause of Chechen independence by the slaughter at the Beslan school. Putin was lucky in his enemies.
Putin has been active in dealing with domestic terrorism, but takes a creatively passive stance when it came to Iraq and Afghanistan. Give Bush enough rope and he'll hang himself — maybe that was what Putin saw that famous day.

Richard Lourie is the author of "The Autobiography of Joseph Stalin" and "Sakharov: A Biography."

TITLE: Taking it Slowly Over Georgia
TEXT: Tbilisi's decision last week to arrest four Russian military officers on espionage charges appears to be an attempt to escalate a dispute with Moscow to a level where Western powers will have no choice but to intervene.There are, however, no quick solutions.
In his first public comments about the crisis, President Vladimir Putin on Sunday accused unidentified foreign sponsors of encouraging the Georgian leadership.
It is hard to believe the Georgian leadership, which is angling for NATO membership, would have triggered the crisis without consulting with Western powers they view as allies against Russia.
Intervention could help to sideline Russia from the resolution of the conflicts in Abkhazia and South Ossetia, the two separatist regions of Georgia supported by Russia.
Whoever the Western powers might be, they should avoid supporting confrontation here if they want to maintain stability throughout the former Soviet republics. They should instead help to mediate and diffuse tensions .
The problems run deep. Russia and Georgia have been engaged in a war of words since the later years of Eduard Shevardnadze presidency in Tbilisi. But sparks really began to fly after Mikheil Saakashvili, the Western-leaning president, took office after the 2003 Rose Revolution. Among the sore points are Russia's ban on Georgian wine and other goods; Russian troops on Georgian soil; and Moscow's support of Abkhazia and South Ossetia.
In the longer term, Georgia would benefit if its leadership focused on making the country so prosperous that the people of South Ossetia and Abkhazia stopped daydreaming about being part of Russia. Georgia also should start thinking about significant concessions that could be made to induce the separatist regimes to make peace with Tbilisi.
If these concessions aren't enough, it is doubtful that anything will work. Any kind of military action to take back Abkhazia and South Ossetia would mean unacceptable losses for the Georgian military.
For its part, Russia has the right to demand that Georgia release the officers. The Kremlin should be supported in seeking mediation by international organizations or individual countries to defuse tensions.
In the longer term, Russia should resist the temptation to seek regime change in Georgia. The result of such a policy would be an unfriendly Georgia, because some 80 percent of Georgians support Saakashvili in the standoff with Russia. The more likely result would be a failed state divided by civil war that could again become a springboard for insurgent groups targeting Russia, as has been the case previously in Georgia's Pankisi Gorge.

This comment first appeared in The Moscow Times.

TITLE: Sovereign Realism
AUTHOR: By Jeffrey Mankoff
TEXT: Foreign Minister Sergei Lavrov's address to the Los Angeles World Affairs Council on Sept. 25 confirmed just how much Russian foreign policy has changed during Vladimir Putin's presidency. Emphasizing the concept of sovereign democracy, Lavrov clearly indicated that Russia would pursue what it sees as its own national interests, instead of following the United States' lead. Rather than seeing this declaration of Russia's foreign policy independence as a setback or a threat, the United States should welcome Russia's growing self-confidence and seek to forge cooperation with Russia on the basis of shared interests."We want to see our sovereignty, which is the birthright of the Russian people, as a guarantee of our ability to pursue our domestic and foreign policies independently, without external interference,"Lavrov told his American audience. Lavrov's speech merely provided rhetorical confirmation of a trend that has become more visible in Russian foreign policy throughout the past year or so — Moscow's willingness to stake out strong preferences and adhere to them, even when subjected to sharp Western criticism. On issues ranging from control of oil and gas supplies to the U.S. presence in Central Asia to support for the Iranian nuclear program, the Putin administration has not hesitated to brave Western (especially U.S.) opposition when it perceives vital national interests to be at stake.
Western commentators have been quick to seize on this pattern of behavior to argue that Putin's Russia is rapidly becoming, if not an enemy, then at least a serious rival to the West. But this interpretation misses the point. Russia's sovereign foreign policy is focused on promoting Russian interests, not challenging the West. The difference is significant, because Russian and U.S interests are not mutually exclusive as they often were during the Cold War.
Of course, U.S. and Russian interests are not identical either, and the newly assertive Russia will have its share of disagreements, some serious, with the United States. Yet the policy being followed by Putin and Lavrov is, on the whole, beneficial to the United States. A foreign policy based on national interest is likely to be both moderate — in the sense of not overreacting to disagreements — and amenable to negotiation and compromise.
One need only remember the chaotic vacillations in the years under former President Boris Yeltsin, when talk about Russia joining NATO gave way to a near-firefight between NATO and Russian troops at Kosovo's Pristina airport, to recognize the value of a stable, interest-driven foreign policy in Moscow.
Getting used to Russia's greater assertiveness will require some adaptation by Western leaders. Washington cannot expect Moscow to fall in line when Russian interests are at stake. Iran is a good example. Between the $1 billion it stands to make for constructing the Iranian nuclear plant at Bushehr and Tehran's ability to make trouble among Muslims in the CIS, Russia is unlikely ever to back sanctions, much less the use of force against Iran.
At the same time, because Russia's position is based on interest rather than ideology (in contrast, for example, to that of France), compromise is theoretically possible. For compromise to work, however, the United States is going to have to take Russian objections seriously and be willing to make certain concessions, whether over Iran or other issues. Providing Russia financial compensation for abandoning its work on the Iranian nuclear program is one possibility that deserves greater scrutiny in Washington. In a larger sense, the United States has to recognize that its expectations of post-Soviet Russia sharing values and priorities with America were misplaced and that relations with Moscow will require a substantial amount of give and take.
No matter who is in power in Moscow or Washington, U.S.-Russian relations will remain complicated simply by virtue of the size and scope of both countries' interests. A healthy dose of realism on both sides will go a long way toward keeping that complexity from shading into hostility. Lavrov's focus on a sovereign foreign policy that defends Russia's interests shows that Russia has already acquired much of that realism. It remains to be seen if the United States will follow suit.

Jeffrey Mankoff is a fellow at the John M. Olin Institute for Strategic Studies at Harvard University.

TITLE: Political Rifts in Eastern Europe Are on Display
PUBLISHER: Financial Times
TEXT: The prospect of falling or failing governments in Poland and Hungary gives an impression of increasing instability across Eastern Europe. Yet it is just another sign that deep political divisions in the region are back on public display after a long period when the countries were on their best behavior to get into the European Union. Poles and Hungarians clearly no longer feel the need to put up a show of disciplined unity.Recent events in Hungary show that a pretense of discipline may be almost as problematic as no discipline at all — if it is revealed to be a sham. The country's socialist prime minister, Ferenc Gyurcsany, is in deep political trouble after having admitted to lying and minimizing the country's economic problems to win re-election earlier this year.
His show of belated honesty may see him through, although the conservative opposition is doing its best to stir street protests and tar his socialists as crypto-communists during this anniversary season of Hungary's 1956 anti-communist uprising. Perhaps wisely, Gyurcsany said last week that his party would leave its office building, which was once the headquarters of Hungary's communists.
While Gyurcsany faces an early popular test of his credibility in local elections on Oct. 1, Poland's conservative prime minister, Jaroslaw Kaczynski, may have to call a general election for November if he cannot quickly find another coalition partner to replace his deputy, Andrzej Lepper, whom he fired last week.
He and Lepper swapped insults after the latter objected when he was not consulted on a decision to send troops to Afghanistan. Another setback for the Law and Justice party under Kaczynski, whose twin brother Lech is the country's president, came last Friday. A banking investigation that the party instigated was ruled illegal by the constitutional court.
The Kaczynskis and their allies had accused former communists among previous governments and bank regulators of selling state-owned banks to foreigners too cheaply, a charge very similar to that of "economic crimes against the state" that was common under communist regimes. But the court ruled the investigation was too wide, and infringed the separation of powers by subpoenaing the central bank.
The Law and Justice party has largely brought its problems on itself through its inability to work with anyone it cannot dominate. But Poland as a whole will suffer, because the government is not making use of the current period of rising growth and falling unemployment, which presents an ideal backdrop to cut wasteful welfare spending. Gyurcsany should avoid the same mistake in Hungary.

This comment appeared as an editorial in the Financial Times.

TITLE: Convenient Anti-Americanism
AUTHOR: By Georgy Bovt
TEXT: Just over a week ago, a remarkable document titled "On a Likely Scenario of Action of the United States toward Russia in 2006-2008" was circulated in the State Duma. It is undoubtedly the largest-scale and most comprehensive anti-U.S. program that post-Soviet Russia has seen.Yes, of course, a lot has been written over the past 15 years. But the fundamental difference between this and other similar exercises is that it appears to have been approved from on high — probably in the section of the Kremlin administration responsible for drafting ideological doctrines.
Also curious is the way in which the 35-page typewritten "scenario" appeared. First, a small leak appeared in last Thursday's Nezavisimaya Gazeta. The newspaper named the report's authors as Valentin Falin — a former member of the Communist Party Central Committee and sometime adviser to Mikhail Gorbachev — who served as ambassador to Germany before turning on and pillorying his former boss at every available opportunity, and former foreign intelligence chief Gennady Yevstafyev.
The following day, Friday, Moskovskiye Novosti editor Vitaly Tretyakov devoted more than two pages of the newspaper to a copy of the report "accidentally" distributed in the Duma. He promised to publish the full text in the Politichesky Klass weekly, which he also edits. Tretyakov is a former democrat who is now a fervent, almost paranoid, anti-Western patriot who does nothing without consulting the Kremlin first, so it is unlikely that he would publish such a document without receiving direct orders.
It is impossible to recount the whole scenario here. Suffice it to say that it brings together almost all of the anti-U.S. myths of the last 15 years. For example, it says that the United States cannot "come to terms with Russia's growing strength," and that Washington is preparing to "bring down" the Putin regime from within, specifically around the time of the 2008 presidential elections. The United States will, the report says, work to isolate the Russian political elite, and look for a stalking horse among liberal groups — currently former-Prime Minister Mikhail Kasyanov — and, inevitably, the CIA is drafting an "Orange project" for Russia. "For the United States, it is unacceptable in principle to have sovereign democracy in Russia ... that is not built into the construction of global American leadership." The United States will also work to undermine "Russia's energy sovereignty," and simultaneously push for Georgia to be accepted into NATO.
The whole document is filled with a spirit of confrontation, a paranoid search for enemies and all sorts of U.S. conspiracies. Yet in a strange way the doctrine is rather convenient, because anyone who criticizes Russian political practice can now safely be written off as an agent of U.S. influence.
Consider the war on corruption, for example. This will also become a U.S. conspiracy because, as we have already seen, the Americans are committed to the "international legal isolation of Russia's top leadership" and will attempt to create a "tense atmosphere around the siloviki and key business representatives" and "accumulate court decisions in the West" against top Russian officials. Any anticorruption campaign in the media can simply be explained away as "incitement" by the United States.
And if, during elections in 2007 and 2008, you hear anyone talking about the authorities breaking the rules, you can rest safe in the knowledge that this is also the result of a U.S. conspiracy. The United States is provoking various Russian Kasyanovs so that they, in turn, will provoke the Russian authorities, so that the authorities will persecute them during elections. Brilliant!
Mass protests — by drivers, cheated investors or disgruntled tenants such as those in the Moscow suburb of Butovo who were stripped of their houses and apartments with insufficient compensation — are also, rest assured, out on the streets only at U.S. instigation. The United States will also be behind almost all of Russia's Spartan opposition , including any media reports about "deceitful propaganda on Russian television," corruption among senior officials, the interests of Gazprom-esque monopolists running counter to the interests of the people, and so on.
An alternative has long been sought for the ideology of sovereign democracy, but obviously little progress has been made. We have ended up with something that should long ago have been consigned to the dustbin of history. All that there is left is to find out who will hoist this carcass up their flagpole. It surely won't be Falin and Yevstafyev.

Georgy Bovt is editor of Profil.

TITLE: From Siberia With Sidecar
AUTHOR: By Jerry Garrett
PUBLISHER: New York Times Service
TEXT: Irbit is a small city in western Siberia, situated on the bleak plains east of the Ural Mountains. In the main square, it has a statue of Lenin that cheeky capitalists have painted pink.That monument is not the only thing that distinguishes Irbit: its 43,000 or so permanent residents are said to own, in toto, some 60,000 motorcycles. Noteworthy indeed for a place with a sub-Arctic climate — brief, cool summers and brutal winters worthy of a Boris Pasternak epic.
Still, it is a mecca for the Russian motorcyclist, with two vocational schools for motorcycle mechanics, a university for motorcycle engineers, a motorcycle museum, a huge annual biker rally — and the factory where motorcycles sold under the Ural name are made. Irbit is Daytona, Sturgis and Milwaukee all rolled into one.
To a market that seems to have endless affection for nostalgic machinery, Ural brings an interesting product line: sidecar-equipped motorcycles that look for all the world like vintage BMWs. (This is not a coincidence.) The bikes offer a curious blend of modern technology, like a front disc brake, and retro touches, like spare wheels and gas-can carriers; some have a powered wheel on the sidecar, an artifact of military service. Prices in the United States top out slightly above $10,000.
How did Irbit, a frozen windswept outpost in the Sverdlovsk region, become a biker heaven? Blame the Barbarossa, the code name for the German invasion in June 1941.
That's when Josef Stalin declared motorcycle manufacturing a strategic wartime industry and decided to have it moved out of Moscow, where it would be vulnerable to German bombers, to a location about as accessible as the dark side of the moon. Irbit would do nicely.
Back then, the Soviet Union had only recently begun manufacturing its own motorcycles, based on designs purchased or purloined (depending on which side is telling the story) from its erstwhile allies, the Germans.
BMW, an aircraft engine maker as far back as World War I, was prevented by the terms of the Treaty of Versailles from manufacturing most military materiel; there were no rules, however, about designing weaponry. And BMW had created a sturdy R71 motorcycle with a sidecar it thought was perfect for the Russian army — perfect because BMW had also secretly designed a superior model for German use. The Russian version of the R71 was called the M-72.
At some point after the shooting began, the Russians realized they'd been had on the motorcycle deal. As the tide of World War II turned, they settled the score by marching straight to Eisenach, to the BMW factory, where the entire R75 assembly line was disassembled. The machinery was transported to Irbit and reconstructed, bolt by bolt.
Since then, more than 3.2 million Urals, with their signature heavy sidecars, have been produced. The Ural, sometimes referred to as Russia's jeep, was a Red Army staple until the late 1950s; after that, Ural concentrated on serving a civilian market hungry for its military-strength models.
For decades, Ural enjoyed a 100 percent share in the domestic market under the Communist system, and up to 130,000 motorcycles a year were produced. But the Soviet Union's collapse also ended the era of subsidies. The real cost of manufacturing a Ural was too high to compete with cheap bikes from Asia. Demand faded, but did not die.
As Ural kept shrinking, so did its workforce. At one point, the remaining employees dragged the assembly line pieces to a small, unheated building and tried to resume production using diesel generators. When fuel ran out, work continued by candlelight.
Russian venture capitalists saved the enterprise at its darkest hour, in the winter of 2000-01, agreeing to new investments.
The company closed for six months to retool, starting again in late 2001. Annual sales have stabilized at about 2,000 worldwide.
The plucky Ural has attracted a devoted, if tiny, worldwide following from riders drawn to its go-anywhere, do-anything toughness and the ubiquitous sidecar. Urals also offer an unusual two-wheel drive ability. With a flip of a couple of levers, the wheel on the sidecar joins the motorcycle's rear wheel in delivering power. Together, they can pull a Ural out of terrain nasty enough to snag a four-wheel-drive truck.
"People used Urals as workhorses," said Madina Merzhoyeva, one of eight employees in Ural's American office in Redmond, Washington. "To haul stuff around, commute, haul potato sacks on farms — young families could afford Urals as their inexpensive but practical transportation."
Among motorcycle journalists who have some history with Urals, the view of the new models mimics what many of my old neighbors in Detroit say these days: "Oh, it's nowhere near as bad as it used to be."
Less than a ringing endorsement, to be sure, and not likely to wind up as a slogan for an advertising campaign (for Ural or for Detroit). But at least they are willing to concede that improvements were needed.
Now known as Irbitsky Mototsykletny Zavod, or IMZ-Ural, the company is striving to overcome appalling quality issues, to upgrade its models and to make them appealing enough to develop an international clientele. Ural still manufactures the frame, engine, transmission, wheels and sidecar parts for the basic 1939 specifications. But more and more components come from suppliers in Japan, Europe and the United States.
To meet U.S. exhaust emissions standards, the anemic 650 cc two-cylinder engine had to be redesigned. In 2003, a 40-horsepower 750 cc model appeared. Sales have gradually increased; in 2005, Ural sold 550 motorcycles in the United States, and the sales goal this year is 800 bikes.
"The challenge has been, however, to overcome the haunting reputation of poor quality," Merzhoyeva said, "and change the perception of Ural being just an old retro bike.
"The company initially set out to be very aggressive in quality improvement, and in a relatively short period of time made significant changes to the bikes; 2003-06 models are light years ahead of even 2002 Urals," she said.
Ural's next big objective is to redesign its ancient transmission, which does not offer the convenience of synchronized gears. To avoid the embarrassment of grinding gears when shifting, the operator either expertly matches the engine speed to the transmission speed or double-clutches, giving the throttle a quick blip with the transmission in neutral and the clutch engaged, to get all the internal parts marching to the same beat.
"During the break-in period, the noise and 'crunchiness' is normal," Merzhoyeva advised. "After about 2,000 kilometers, the stiffness and noise significantly decrease."
Anyone proficient in motorcycle operation is likely to feel, when riding a Ural, like a buffalo on roller skates. The drag of the sidecar can make the 336-kilogram ensemble pull left during acceleration and between gear changes, much as torque steer tugs at the steering in a powerful front-drive car. During deceleration and braking, the Ural pulls to the right. Since there's always clutching, shifting, accelerating and braking going on, the Ural seems to slither back and forth across the road.
Cornering is also a specialized skill in sidecar motorcycling. If the sidecar is empty, its wheel is likely to lift off the ground during a right-hand turn; turning works better with a loved one, or other ballast, in the sidecar. Getting the sidecar wheel back to terra firma takes anxious moments and a commitment to turning the handlebars left.
Not only can a Ural carry two people, the camouflage-painted Gear-Up model (with factory-installed machine gun mount — weapon sold separately) comes with a passenger seat on the motorcycle that increases total capacity to three. Behind the sidecar's seat is enough storage for a duffel bag or two. All Urals with sidecars carry a handy spare tire.
The Ural line now comprises five models. The $10,190 Patrol is a tad less martial than the combat-ready Gear-Up, $10,990; both feature two-wheel drive. The $10,890 Retro is faithful to the 1939 BMW design. The $8,990 Tourist offers amenities like a windscreen for the sidecar, and the $10,090 Troyka evinces a more modern design. (So does the coming Wolf cruiser, which lacks a sidecar and is quite un-retro. It is available now for preorder at $6,390.)
I tested the teeth-rattling Gear-Up in southern California. I wanted the quintessential Ural experience, and I confess to watching too many episodes, as an impressionable youth of "Hogan's Heroes." My experience double-clutching a '32 Ford long, long ago helped me to shift with commendable mercy through the four forward gears. Another unusual Ural feature is its reverse gear (the Honda Gold Wing and BMW K1200 have limited reversing ability.)
A Ural will cruise at nearly freeway speeds. Braking safely from those velocities seemed iffy at first, but ultimately it did stop. Turning the Ural requires actually pulling and pushing on the handlebars; leaning, as you would on a two-wheel motorcycle, produces nothing but a hernia with a full sidecar.
The sidecar can be removed, but any temptation to run the bike without its sidecar — despite its classic good looks — is best suppressed.
"Ural was born with a sidecar," Merzhoyeva explained. "Its entire geometry is calculated to produce the best sidecar handling. If you take the sidecar off, the bike will require some modifications for best performance.
"People who buy Urals take the sidecars off very rarely," she added. "And when they do they put it back on, because a Ural without a sidecar is not a Ural."
Urals are known for their durability, and its cult of owners regularly set off on hemisphere-crossing or even round-the-world journeys. About 50 kilometers was enough for me, not to mention my stoic companion in the sidecar.
It was all something of a Walter Mitty moment; I imagined us juddering along the trans-Siberian Road of Bones on a cruel winter's night, my trusted lieutenant at my side, automatic weapons at the ready and boxes of ammunition bouncing carelessly in the trunk.
We are singing, "Then conquer we must, because our cause is just."

TITLE: Lebanese Military Extends Reach to Border
AUTHOR: By Hamza Hendawi
PUBLISHER: The Associated Press
TEXT: LABBOUNEH, Lebanon — Lebanon's army commander raised his country's flag on a ridge overlooking the border with Israel, reclaiming the area after Israel's pullout from nearly all of south Lebanon.Gen. Michel Suleiman told about 500 soldiers that the army won't allow any attacks from Lebanon that could undermine the cease-fire — an apparent reference to rockets Hezbollah launched at Israel from the south in 34 days of fighting that ended Aug. 14.
"Stay vigilant to uphold the law and deter whoever undermines the course of security and stability," Suleiman said.
He said that although his army is no match for Israel, it would fight if necessary.
"I call upon you to confront the Israeli aggressions and violations with whatever meager capabilities that are available," he said.
The United Nations-brokered cease-fire supports the Lebanese military in reasserting control over the south — including areas last held by the national army 30 years ago.
The Lebanese troops are supported by a beefed-up UN peacekeeping mission as they move to extend Lebanese authority over the entire south.
Lebanese troops were expected to fan out through the areas newly vacated by Israel beginning Monday.
But Israeli forces' continued presence in part of the border village of Ghajar, and their plans to continue patrolling Lebanese airspace, are potential sources of friction between the neighbors.
An army spokesman said Lebanese army deployment in the south has exceeded the minimum of 15,000 troops required by the UN cease-fire resolution. The spokesman requested anonymity in compliance with military regulations.
The United Nations Interim Force in Lebanon called Israel's pullout from nearly all of south Lebanon "significant progress." But both the Lebanese government and Hezbollah dismissed the withdrawal Sunday as "incomplete" and demanded Israel stop what they called its violations of Lebanon's airspace, sea and land.
Parliamentary Speaker Nabih Berri, a close ally of Hezbollah, warned that guerrilla attacks could resume if Israel did not fulfill the UN cease-fire resolution and all Lebanese territory was not regained.
"Our right of resistance is always there," he told As-Safir newspaper on Monday.
Senior Hezbollah official Sheik Hassan Ezzeddine warned that the Islamic militant group would resume attacks against Israel if it breached the UN cease-fire.
UNIFIL confirmed in a statement Sunday that Israel had withdrawn from the entire south except Ghajar.
The pre-dawn pullout Sunday put a formal end to a nearly three-month incursion into Lebanon that began after Hezbollah guerrillas captured two Israeli soldiers and killed three others in a July 12 cross-border raid.
It clears the way for the full deployment of UNIFIL's 15,000 soldiers, who will police the border with Lebanese troops.
Israel wants Lebanon to keep Hezbollah out of the south and disarm it, but Beirut has indicated it would not actively seek Hezbollah's weapons. The militant group said it would disarm only when a strong central government was in place.

TITLE: Solskjaer Double Puts Man Utd on Top
AUTHOR: By Mitch Phillips
PUBLISHER: Reuters
TEXT: LONDON — Manchester United went back to the top of the Premier League with an Old Trafford demolition job on Newcastle United on Sunday that should have brought them more than two Ole Gunnar Solskjaer goals.The Norwegian converted close-range efforts either side of halftime as United won 2-0 to move to 16 points and above Chelsea on goal difference following the champions' 1-1 home draw with Aston Villa on Saturday.
Bolton Wanderers are third on 14 points after their 2-0 home win over Liverpool on Saturday with Portsmouth fourth on 13 after they went down 2-1 at Tottenham Hotspur on Sunday.
Everton and Villa, the only unbeaten clubs in the division, also have 13, as do Reading after their 1-0 win at West Ham United on Sunday. In the day's other game Blackburn Rovers beat Wigan Athletic 2-1.
Manchester United, who lost to Arsenal and drew with Reading in their previous two games after winning the first four, were quickly into their stride on Sunday but had to wait until four minutes before halftime to get on the scoresheet.
Cristiano Ronaldo, again United's most impressive performer, fired a shot against a post and Solskjaer was on hand to knock in the rebound.
Four minutes after halftime Solskjaer got his second when he diverted a Nemanja Vidic shot beyond Steve Harper.
United had already hit a post through Darren Fletcher and Ronaldo rattled the bar with another powerful run and shot as Newcastle fell apart.
"We played with a great intensity and controlled the game throughout," United manager Alex Ferguson told Sky Sports. "Today we were back on song. It was a really terrific performance."
Ferguson also praised Solskjaer, whose career seemed over after a series of knee injuries.
"If you are out of the game for two years at his age you obviously have doubts but you might find it difficult to believe that a player at the age of 33 is getting better but that's what we've seen this season," he said.
Newcastle boss Glenn Roeder said his side had been outclassed by the talents of Ronaldo and Wayne Rooney. "You have to say they are young players but who are already world class. The stuff they are producing at the moment was uncomfortably marvellous to watch," he said.
All the post-match talk at White Hart Lane centred on Tottenham's second goal, a Jermain Defoe penalty earned by a blatant dive by Ivorian international Didier Zokora. That came after Danny Murphy had put Spurs ahead in the first minute and though Nwankwo Kanu pulled one back late in the first half, Spurs took the points.
"The penalty decision, everyone has seen, was farcical," said Portsmouth boss Harry Redknapp.
"It's human error, the referee made a mistake, but surely in games of this importance, everybody knows it's not a penalty, surely we can use the technology we've got?
"It takes less than 10 seconds I'd seen the replay and why can't the fourth official look at that and tell the referee?"
Tottenham manager Martin Jol offered something of a defence for his $14.95 million signing from St Etienne. "When it happened I thought it was a penalty, maybe he was anticipating the contact," he said. "It was not a dive, maybe he was off-balance."

TITLE: State Of Emergency Kept in Iraq
AUTHOR: By Qassim Abdul-Zahra
PUBLISHER: The Associated Press
TEXT: BAGHDAD, Iraq — Parliament extended Iraq's state of emergency Monday as gunmen snatched 14 employees from computer stores in downtown Baghdad in the second mass kidnapping in as many days.Seven cars pulled up to the shops in front of Baghdad's Technical University, and gunmen wearing military-style uniforms fanned out to surround the buildings, police Lieutenant Thair Mahmoud said. The attackers then forced the employees outside and into sport utility vehicles at gunpoint, he said.
On Sunday, 24 workers at a food factory in Baghdad were seized by gunmen who shot and wounded two workers who refused to climb into a refrigerated truck with their fellow captives.
Similar mass kidnappings in the past have been blamed on either Sunni extremists or Shiite death squads, who sort the captives by their sect and kill their targets.
In other sectarian violence, dozens of bodies were found in and around Baghdad. At least 15 people also were killed in attacks around the country, including a noontime bomb blast in Baghdad's downtown Al-Nasir Square that killed four and wounded 13.
The U.S. command said Monday that three American Marines died in Iraq's western Anbar province on Saturday — two in combat and the third in a vehicle accident. With their deaths, at least 73 American service members died in Iraq in September — making it the second deadliest month this year, after April when at least 76 died.
One British soldier was killed and another wounded in a mortar attack on the headquarters of the 1st Battalion, Light Infantry Battle Group in the southern city of Basra, British military spokesman Maj. Charlie Burbridge said.
The attack on the Shat Al-Arab hotel in Basra came Sunday afternoon, Burbridge said. Fifteen mortar shells were fired at the compound and three landed inside.
One of the rounds that missed the compound landed on a nearby home, killing a 7-year-old boy and his 3-year-old sister and wounding a third child, Basra police said.
Meanwhile, Iraqi politicians expressed concern over a plan by Syria to move border guards from its frontier with Iraq to help patrol its border with Lebanon — a step that could further open the doors for insurgents to move from Syria to Iraq.
"The Syrian move will make the terrorists' entry to Iraq easier," said Abdul Karim al-Inazi, a Shiite lawmaker with the prime minister's Dawa Party and a former minister of state for national security.
"The Syrian government should do its best to control the borders with Iraq," he said, calling for the Iraqi government to also deploy more troops on the border.
Syria has long been under pressure to do more to stop insurgents slipping across its long desert border with Iraq, and Damascus has insisted it is doing all it can. Now Syria is facing UN requests that it also strengthen its guard on its Lebanese border to prevent weapons from going to Hezbollah guerrillas.
Prime Minister Nouri al-Maliki's government has struggled to rein in sectarian violence, which U.S. Ambassador Zalmay Khalilzad said Sunday has become deadlier than the Sunni-led insurgency that broke out after the U.S.-led invasion of Iraq in March 2003.

TITLE: NHLKicks Off Season With Party
AUTHOR: By Ira Podell
PUBLISHER: The Associated Press
TEXT: NEW YORK — The NHL hosted a big bash last week in a Manhattan club, replacing celebration for trepidation, and kicking off a new season starting Wednesday free of lockout clouds, labor unrest and questions about the league's viability.Star players hung out with supermodels in front of the shiny Stanley Cup that lit up with every flash, while members of the champion Carolina Hurricanes checked out their freshly engraved names.
Hockey is fun again, and the NHL is striving to make people notice.
"Every year is always big. But I think we had a great year last year," said teenage phenom Sidney Crosby, the Pittsburgh star and runner-up for rookie of the year. "There shouldn't be anyone second-guessing that."
He and rookie of the year Alexander Ovechkin, who set a first-year record with 425 shots on goal last season with Washington, provided many of the highlights.
After losing a year to the lockout, last season featured radically revamped rosters. Some stability returned in the offseason, but big names were still on the move as the league prepared for its second season of the salary cap, which increased from $39 million to $44 million.
Pittsburgh's Yevgeny Malkin, who dislocated his left shoulder during the preseason, sneaked away from his Russian pro team upon its arrival in Helsinki for training camp, disappeared for a few days, then reappeared in Los Angeles with his agents — all for a shot at the NHL.
Some simply retired, such as longtime Red Wings captain Steve Yzerman, gone after 22 seasons in Detroit.
Others, such as top defensemen Rob Blake and Chris Pronger, found new teams and new challenges.
Blake left Colorado to return home to the Los Angeles Kings, the team that drafted him in 1988 and kept him on the blue line until he was traded in 2001.
Pronger also calls Southern California home now, joining the Anaheim Ducks by forcing a trade out of Edmonton after just one season with the Oilers that ended with a surprise trip to the Stanley Cup finals.
The Oilers eliminated the Ducks in the Western Conference finals, then nearly won it all.
"It's tough to sit here and think you were one game away from being the Stanley Cup champions," Pronger said.
"It's difficult ... but it leaves that sense of understanding how hard it is to get there and how much you have to sacrifice and give up to get there."

TITLE: Schumacher Goes Head to Head With Alonso
AUTHOR: By Salvatore Zanca
PUBLISHER: The Associated Press
TEXT: SHANGHAI, China — There is little time for Michael Schumacher to savor his thrilling victory at the Chinese Grand Prix. There is another race next Sunday.Likewise for Fernando Alonso. He and Renault have to regroup quickly after Schumacher tied him at the top of the Formula One driver standings heading to the Japanese GP at Suzuka.
After being 25 points behind with seven races ago, Schumacher's 91st career victory put him even with defending champion Alonso at 116 points with only the Japanese GP and Brazilian GP on Oct. 22 remaining.
"It's quite a miracle that we're there," Schumacher said. "Now we go to the last two races and I believe that we will have to wait until the last one before a decision can be reached.
"Yes, it's going to be an interesting couple of weeks that we are going to have to face. I really look forward to that."
Alonso, too, was excited at the prospects of a match race in Japan.
"Suzuka is one of the more technical circuits, very difficult, and hopefully we will have a good race," he said. "I think I have been very good in the last few years, and it is the race of the last three that we are (most) looking forward to."
Last year at Suzuka, he was third and Schumacher fifth. In 2004, Schumacher won the race, and his last driver's title for Ferrari.
With two races left in his glittering career, Schumacher has a slight chance of clinching his eighth Formula One championship next Sunday.
If he was to win his third straight race and Alonso dropped out, Schumacher would lead by 10 points with one race to go. Then, the best Alonso could achieve would be a tie on points if he won in Brazil and Schumacher went scoreless.
If the final standings end in a tie, the winner is the driver with the most victories — and Schumacher leads by seven to Alonso's six for now. If they were tied on wins, it would go to whoever has the most second-place finishes, which Alonso leads six to four.
What's the chances of Schumacher winning and Alonso dropping out?
It happened just two races ago at the Italian GP.
Schumacher has won five of the last seven races, outpacing Alonso's start to the season when the Spaniard captured six of the first nine. However, the last time Alonso won was in June at the Canadian GP.
He seemed set to end his drought in the Chinese GP when he dominated practice, qualifying to earn the pole, and the first half of Sunday's race.
However, he said the weather conditions and tire problems cost him a victory. He began to have trouble with the front tires after the first pit stop, and his 10-second lead eventually disappeared.
He won't let that happen again.
"For Suzuka and Brazil, we need to believe in our tire," he said. "At the moment both cars, Renault and Ferrari, have been quite similar in terms of performance and each race is dominated by the tires."
Alonso lost the lead in Shanghai on the 31st lap, but battled back to finish second, just ahead of teammate Giancarlo Fisichella. That allowed Renault to go a point ahead of Ferrari in the team race, 179-178.

TITLE: Gaza Strip Tense After Day of Violence
AUTHOR: By Ibrahim Barzak
PUBLISHER: The Associated Press
TEXT: GAZA CITY, Gaza Strip — Hamas militiamen withdrew from the streets of Gaza Strip on Monday and returned to their normal posts after the worst day of internal violence since Hamas took control of the Palestinian government in March.Despite the move to reduce tensions, a 20-minute gunbattle erupted at the main hospital in Gaza City when the family of one of those killed in the fighting arrived to retrieve his body.
The Fatah gunmen accompanying the family opened fire on the Hamas militiamen patrolling the hospital, sending patients and doctors running for cover. No one was injured, hospital officials said.
In the West Bank city of Ramallah, Palestinian President Mahmoud Abbas' Fatah Party enforced a general strike, closing shops and private schools in a show of force against Hamas. For its part, the Hamas-led government ordered all ministries closed to protest Fatah attacks on government buildings.
Fatah militants also released a Hamas official in the Finance Ministry whom they had briefly kidnapped, telling him his abduction was intended to send Hamas a message to end the Gaza violence, Hamas officials said. Hamas denied Fatah militants' claim that they had kidnapped a Hamas minister.
Gaza, the center of the violence that killed eight people on Sunday, remained tense Monday, with many shops closed out of fear of renewed attacks.
The violence began Sunday morning when members of the Hamas-led government's 3,500-man militia confronted civil servants — including members of the Fatah-allied security forces — who were protesting the government's inability to pay their wages.
The tense confrontations quickly erupted in running gunbattles that spread across the Gaza Strip, sending civilians fleeing for their lives and turning the center of Gaza City into a battle zone.
Fatah militants quickly followed through on a promise to retaliate for the Gaza violence with attacks of their own in the West Bank, where Hamas is far weaker.
Hundreds of angry Fatah supporters torched the Cabinet building in Ramallah and trashed Hamas-linked offices in the cities of Hebron and Nablus.
Both Prime Minister Ismail Haniyeh of Hamas and Abbas appealed for calm.
"These confrontations have crossed the red line, which we have avoided crossing for four decades," Abbas said in a speech on Palestinian TV.
Abbas called on the security officers to end their protest and for the Hamas militia, which the government formed after Abbas took control of all the official security branches, to leave the streets.
Late Sunday, Interior Minister Said Siyam, who is in charge of the militia, ordered it to withdraw, and by Monday morning the militiamen had stopped patrolling the streets and pulled back to their bases near government ministries and on some street corners, reducing friction.
In the southern Gaza town of Khan Younis, where the violence began, dozens of security officers patrolled the streets to maintain order.
Despite the appeals for calm, militants in Gaza torched the Agricultural Ministry early Monday, and a group of young students in the northern Gaza town of Beit Hanoun stoned the house of a Hamas minister until his bodyguards chased them away by firing in the air.
Amid the violence, Abbas called for the renewal of stalled negotiations for the formation of a national unity government, a move aimed at ending crippling sanctions on the Palestinian Authority. However, the violence dampened hopes for a Hamas-Fatah coalition.
Israel and the West, which view Hamas as a terror group, cut off hundreds of millions of dollars in aid and tax transfers to the Palestinian Authority after Hamas took power, making it nearly impossible for the new government to pay its 165,000 workers.
Abbas has tried to end the crisis by pushing Hamas to accept international demands to renounce violence and recognize Israel's right to exist, but the radical Islamic group has refused.
Tension grew in recent weeks as civil servants, many of them Fatah supporters, held expanding protests against the government to demand back wages.
Violence between Fatah and Hamas loyalists plagued Gaza throughout the spring, but largely disappeared when Israel launched a Gaza offensive in late June after Hamas-linked militants captured an Israeli soldier.
Abu Mujahed, a spokesman for the Popular Resistance Committees, one of the groups responsible for Cpl. Gilad Shalit's capture, said Monday that contacts with Egyptian mediators trying to broker his release had resumed, but there was no agreement.

TITLE: All 155 Dead In Brazilian Plane Crash
AUTHOR: By Vivian Sequera
PUBLISHER: The Associated Press
TEXT: BRASILIA, Brazil — Authorities said Sunday there were no survivors among the 155 people aboard the Brazilian jetliner that crashed deep in the Amazon jungle in the nation's worst air disaster, as rescue workers began pulling bodies out of the twisted wreckage.Aviation officials have said the Boeing 737-800 and a smaller executive jet apparently clipped each other in midair Friday, causing Gol airlines Flight 1907 to crash in jungle so dense that crews had to cut down trees to clear a space for rescue helicopters to land. The smaller plane — carrying Americans — safely landed at a nearby air force base.
The Brazilian air force said in a statement that rescue workers had combed through the wreckage and found no signs that anyone could have survived the crash. Rescue workers had recovered two bodies by Sunday night and airlifted them out by helicopter, the statement said.
Gol airlines, which operated the flight, confirmed there were no survivors in its own release. About 30 Brazilian air force troops were at the site late Sunday looking for more bodies.
"It's extremely difficult to get there," said Ademir Ribeiro, a foreman on the nearby Jarina ranch, the center for rescue operations. The ranch was located in the central state of Mato Grosso, some 1,090 miles northwest of Rio de Janeiro.
Celio Wilson de Oliveira, the Mato Grosso state Secretary of Justice and Public Safety, said the commercial plane crashed near a reservation of the Kayapo Capoto-Jarina Indians in Xingu Park.

TITLE: Video Shows Hijackers A Year Before Sept. 11
AUTHOR: By Jennifer Quinn
PUBLISHER: The Associated Press
TEXT: LONDON — Sept. 11 ringleader Mohamed Atta smiles in a video just broadcast for the first time, appearing with a fellow hijacker in the only known image of the two men together.A widely published photograph of Atta had shown a clean-shaven man with a lined face, steely gaze and cold expression. The new recording released Sunday reveals a younger, bearded man who smiles and pats his hair into place after self-consciously trying on the hat.
Atta appears with fellow hijacker Ziad Jarrah in the soundless video, which was posted on the web site of the Sunday Times.
Attah and Jarrah appear far different than in their mug shots made famous after they were identified as the attackers who hijacked planes that crashed into the World Trade Center and a Pennsylvania field five years ago. Both are bearded. They seem younger, and Atta's infamously bleak gaze is replaced by a somewhat softer expression.
The video also contains footage of al Qaida leader Osama bin Laden speaking to a large audience, including children.
The British newspaper said the hour-long tape was recorded on two different days in Afghanistan in January 2000, and was obtained "through a previously tested channel," giving no further details. The newspaper said the video had been authenticated, on condition of anonymity, by sources from al Qaida and the United States.
A U.S. intelligence official, who declined to be identified, citing government protocol, said, "We're aware of the tape and we're reviewing it." The official declined to answer further questions.
The Sunday Times said the footage was taken in Afghanistan and was meant to be released after the men's deaths.
It appears to be a departure from previous releases by al Qaida, which is "normally, very professional in their media," said Paul Beaver, an independent defense and security expert.
It did not appear on Web sites commonly used by the group. The newspaper quoted an unidentified American source who said that lip readers had been unable to decipher what the men were saying.
The newspaper said the hourlong video was made at an al Qaida training camp in Afghanistan, is dated Jan. 18, 2000, and contains the only known footage of Atta and Jarrah together.
Ben Venzke, head of the Virginia-based IntelCenter, which monitors terrorism communications, said the video was probably raw footage that al Qaida had intended to edit into a package similar to one released last month showing the last testament of two of the Sept. 11 hijackers, Wail al-Shehri and Hamza al-Ghamdi.
For more than 30 minutes, the video shows Atta, who flew one of the planes that brought down the World Trade Center, and Jarrah, who piloted United Airlines flight 93, which crashed into a Pennsylvania field, sitting in front of a white wall, alternately alone and together.
The Egyptian-born Atta is wearing a dark sweater and pats his hair into place after trying on a hat for the camera. At one point, the camera pans out to show a machine gun leaning against the wall next to him.
Atta appears to be the more reticent of the two hijackers. During a portion of the tape showing them together, the Lebanese-born Jarrah laughs and smiles broadly as Atta shakes his head slightly. The conversation then seems to turn serious, and the tape shows the two sitting on the floor, hunched over papers, which The Sunday Times reported was Jarrah's will.
Bin Laden said a few years ago that he was saving Atta's last testament to release for a special occasion, Venzke said.
"It is highly unlikely that al Qaida wanted the material to be released in this manner, and it is not consistent with any previous release," he said.
Diaa Rashwan, an Egyptian expert on militant groups, said he found it strange that the cameraman focused not only on bin Laden but also on his audience. He said normally al Qaida videos of bin Laden just focus on him.
"Was this a video by al Qaida or by a security agency?" Rashwan asked. "I have never seen such a video."
Although the video has no sound, it could contain valuable information, Beaver said.
"It helps build up a profile, so you can ID people in the future," he said.
But Robert Ayers, an international security expert, said the tape was more curiosity than valuable resource.
"The fact that these guys changed their facial appearance? Any actor on any stage in the world knows how to change their appearance, so why are we so surprised these guys changed their appearance?" Ayers said.
Previous mug shots released of the two men show them clean-shaven and with closely cropped hair.
The video also includes images of a man who appears to be bin Laden speaking to an audience outdoors. A time stamp indicated that footage was shot on Jan. 8, 2000, and The Sunday Times said it appeared to have been made at Tarnak Farm, once the base for bin Laden's family in the Afghan desert near Kandahar's airport.
It shows about 75 men, many in turbans or caps, sitting on the ground as bin Laden arrives to address them. A few children are in the crowd. The man who appears to be bin Laden stands in front of an expanse of bare dirt dotted with a few trees and windowless, one-story mud-colored buildings, some of them partly in ruins.
He appears calm, with a long beard and a tan cloak over a white robe that covers his head. He speaks for more than 10 minutes, although the camera frequently cuts away from him and onto the audience.
The Sunday Times said those shown listening to bin Laden included Ramzi Binalshibh, who allegedly helped plan the Sept. 11 attacks and is now being held in the U.S. prison camp at Guantanamo Bay, Cuba.
Also reportedly present was Nasir Ahmad Nasir al Bahri, a security guard who The Sunday Times said has claimed he was authorized to shoot bin Laden in the head if the leader was in danger of being captured.

TITLE: Interim PM Installed in Thailand
AUTHOR: By Denis Gray
PUBLISHER: The Associated Press
TEXT: BANGKOK, Thailand — Tanks and troops that toppled a civilian government nearly two weeks ago were off the streets of the Thai capital Monday following the announcement of a new interim prime minister to lead the country for one year.The military council that ousted Prime Minister Thaksin Shinawatra in a coup on Sept. 19 while he was abroad chose former army commander Surayud Chulanont to serve as premier until elections promised for October 2007.
Surayud, sworn in Sunday as the country's 24th prime minister, said during the ceremony that he wanted to heal a country divided by the policies of his predecessor and settle a bloody Muslim insurgency festering in Thailand's south.
"It was injustice that caused problems in politics and the south," Surayud said. "I urge everybody to help solve the two problems, and unity is needed to deal with them."
Surayud told reporters Monday that he would travel to the restive region after the formation of a 35-member Cabinet, expected in about a week.
The Cabinet's first confirmed member is Pridiyathorn Devakula, the head of Thailand's central bank, who told reporters he has agreed to join the interim body. He said his exact position has not been discussed but he is expected to get a key portfolio in the finance-economic sector.
Pridiyathorn, 59, who helped steer Thailand's economy out of the devastating 1997 Asian financial crisis, took over the helm of the Bank of Thailand in 2001. He has been praised for policies that promoted financial stability.
An official of Thaksin's Thai Rak Thai party, meanwhile, said at least 10 prominent party members have resigned since the coup.
The 10 are former members of Parliament and Cabinet ministers, said Samarn Lertwongrat, the party's registrar. The most prominent among them is former Foreign Minister Surakiart Sathirathai, who was named by the former government as Thailand's candidate to become the next UN secretary-general, and also has the backing of the military council that ousted Thaksin.
Thaksin, accused by the coup makers of corruption and divisive policies, is currently in London.
In his first day in office, Surayud met with U.S. Ambassador Ralph L. Boyce and received blessings and Buddhist amulets from the country's senior ranking Buddhist monk, 93-year-old Supreme Patriarch Somdet Phra Nyanasamvara.
Surayud and Boyce, the first foreign diplomat to meet Surayud, shook hands in front of reporters at Government House, but the prime minister did not speak to the press.
"We had a very good discussion," Boyce said. "I think it's very well known that the United States urges a speedy return to a democratically elected government and protection of civil liberties during the interim, and the prime minister assured me this would be the case."
A spokesman for the military council said that troops began their drawdown from Bangkok's streets on Sunday.
"The soldiers are back in their barracks and the police have redeployed from Government House and all other government offices," spokesman Lieutenant General Palangoon Klaharn said.
Surayud, 63, tried to set himself apart from the brash, pro-business Thaksin by saying he would strive to balance the needs for a growing economy with the happiness of the people.
"I will focus on self-sufficiency, more than focusing on the GDP numbers," Surayud said. "I will focus on the happiness of the people, more than the GDP."
The military council gave itself the power to remove Surayud and his Cabinet, approve the selection of a National Assembly speaker, and have final say on a 100-member committee that will write the next constitution.

TITLE: George Michael Arrested on Drug Charges in London
PUBLISHER: The Associated Press
TEXT: LONDON — George Michael was arrested on suspicion of possessing marijuana after police found him slumped over the steering wheel of his car in London, authorities said Monday.Michael was arrested after police responded to complaints that a car was blocking an intersection in North London at 3:22 a.m. Sunday. He received a caution for possession of cannabis and was released on bail on a charge of being unfit to drive. He has a November court date.
Just a week earlier, Michael gave his first solo concert in 15 years. The Spain show kicked off his new tour, "25 Live," which is scheduled for 28 European cities this fall.
Michael rose to fame in the 1980s as half of the duo Wham! before starting his solo career.
Police had earlier warned Michael for possession of cannabis in February.
In April, he hit three parked cars. He later acknowledged in an interview that he was a "terrible driver" and said he was trying to maneuver out of a parking spot.

TITLE: Lawmaker in Sex E-Mail Scandal
AUTHOR: By Lara Jakes Jordan
PUBLISHER: The Associated Press
TEXT: WASHINGTON — While GOP leaders scramble to contain the political fallout from the latest Washington sex scandal, the FBI is examining Republican Mark Foley's e-mail exchanges with teenage boys to see if laws were broken.The FBI "is conducting an assessment to see if there's been a violation of federal law," FBI spokesman Richard Kolko said, declining to elaborate.
Foley, a congressman from Florida, abruptly quit Congress on Friday after reports surfaced that he'd sent sexually charged electronic messages to boys working as congressional pages.
The disclosure sent House Republicans into damage control mode amid charges by Democrats that some House leaders may have known for months about Foley's inappropriate overtures toward the young pages.
White House press secretary Tony Snow, asked about that Monday on ABC's "Good Morning America," urged greater efforts to "figure out what happened here."
He called it "a terrible story" and said he considered it unfortunate that "people are thinking, 'OK, can I get political advantage out of this'."
House Speaker Dennis Hastert, in a letter sent Sunday to Attorney General Alberto Gonzales, asked the Justice Department to "conduct an investigation of Mr. Foley's conduct with current and former House pages."
White House counsel Dan Bartlett called the allegations involving Foley shocking, while Democrats demanded that investigators determine whether Republican leaders tried to cover up Foley's actions for political reasons.
"The attorney general should open a full-scale investigation immediately," Senate Democratic leader Harry Reid of Nevada said in a statement, including whether GOP leaders "knew there was a problem and ignored it to preserve a congressional seat this election year."
Foley's district is heavily Republican, but now may be won by a Democrat. Republicans are struggling to maintain their House majority in the upcoming election.
FBI cyber sleuths are looking into the text of some of the Foley messages, checking to see how many e-mails and instant electronic messages were sent and how many computers were used, according to a law enforcement official, who spoke on condition of anonymity because of the ongoing investigation.