SOURCE: The St. Petersburg Times
DATE: Issue #1333 (99), Tuesday, December 18, 2007
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TITLE: First Nuke Shipment Made 
To Iran
AUTHOR: By Jim Heintz
PUBLISHER: The Associated Press
TEXT: MOSCOW — Russia has made its first shipment of nuclear fuel to an Iranian nuclear power plant at the center of the international tensions over Tehran’s atomic program, the Foreign Ministry said Monday.
Iran contends its plant in the southern city of Bushehr is strictly for civilian purposes, but the project concerns the United States and others who fear Tehran could use it to advance efforts to build nuclear weapons.
Russia is building the Bushehr plant — construction that has been frequently delayed. Officials said the delays were due to payment disputes, but many observers suggested Russia also was unhappy with Iran’s resistance to international pressure to make its nuclear program more open and to assure the international community that it was not developing nuclear arms.
Russia announced last week that its construction disputes with Iran had been resolved and said fuel deliveries would begin about a half year before Bushehr was expected to go into service.
“All fuel that will be delivered will be under the control and guarantees of the International Atomic Energy Agency for the whole time it stays on Iranian territory,” the Foreign Ministry said in a statement. “Moreover, the Iranian side gave additional written guarantees that the fuel will be used only for the Bushehr nuclear power plant.”
Iran confirmed that it had received the shipment, the official Iranian news agency IRNA reported.
“The first nuclear fuel shipment for the Bushehr atomic power plant arrived in Iran Monday,” IRNA quoted Iranian Vice President Gholam Reza Aghazadeh as saying.
Aghazadeh said the Bushehr plant was 95 percent complete and would begin operations “next year.” He indicated the reactor needed 80 tons of nuclear fuel during the initial phase of operation, but did not provide further details.
The U.S. has been pushing the U.N. Security Council to pass a third round of sanctions against Iran for its refusal to suspend uranium enrichment.
“This fuel shipment gives the Iranians one more reason to suspend their enrichment program,” White House spokesman Gordon Johndroe said. “If they’re getting fuels from the Russians now, Iran doesn’t need its own program.”
The American effort became more difficult earlier this month with the release of a new U.S. intelligence report that concluded Iran had halted its nuclear weapons development program in 2003 and had not resumed it through at least the middle of this year.
Although Russia has resisted drives to impose sanctions on Iran, it also repeatedly has urged Tehran to cooperate with the Vienna, Austria-based IAEA to resolve concerns over the nuclear program.
Foreign Minister Sergey Lavrov underlined that position last week after a meeting in Moscow with his Iranian counterpart Manouchehr Mottaki.
Lavrov said resolving the controversy is possible “solely on the basis of the nuclear nonproliferation treaty, IAEA rules and principles and, certainly, with Iran proving its right to the peaceful use of nuclear energy.”
Officials at Atomstroyexport, the Russian contractor for Bushehr, raised the prospect last week of creating a Russian-Iranian joint venture “to ensure security” at the Bushehr plant, according to the RIA-Novosti agency. That could indicate Russian interest in ensuring that enriched uranium at the plant is not stolen or diverted. Depleted fuel rods also could be reprocessed into plutonium.

TITLE: Putin To Be PM in Future Government
AUTHOR: By Oleg Shchedrov
PUBLISHER: Reuters
TEXT: MOSCOW — President Vladimir Putin said on Monday he would become prime minister in a future Russian government if his close ally Dmitry Medvedev was elected president, giving Putin a new role after he leaves the Kremlin.
A 42-year-old lawyer with no political base of his own, Medvedev is virtually certain to win next March’s presidential election since most Russians will vote for whoever the highly popular Putin endorses.
“If Russian citizens express their confidence in Dmitry Medvedev and elect him as the country’s president, I will be ready to head the government,” Putin told a congress of his United Russia party held near Moscow’s Red Square.
“(We) shouldn’t be ashamed or afraid of transferring the key powers of the country, the destiny of Russia to the hands of such a man,” Putin added in his speech.
Medvedev, 42, was later adopted by the congress as United Russia’s presidential candidate. Delegates voted 478-1 in a sober, Soviet-style ceremony held without debate.
In his brief acceptance speech, Medvedev listed priorities such as strengthening Russia’s position in the world, preserving the Russian nation, looking after the young and the old.
“All this is in Vladimir Putin’s strategy. I will be guided by this strategy, if I am elected president,” Medvedev said.
“But carrying out an idea can only be successful with the participation of its author. I have no doubt that in the future Vladimir Vladimirovich (Putin) will use all his resources, all his influence in Russia and abroad for the benefit of Russia.”
Putin signaled Medvedev, a first deputy prime minister and chairman of state gas giant Gazprom, last week as his preferred successor. The constitution bars Putin from a third term.
Analysts said the choice of a loyal longtime colleague signaled Putin’s desire to keep a grip on power after leaving the Kremlin. The two men have worked together for 17 years.
Putin walked into the congress hall side by side with Medvedev to applause from the serried ranks of dark-suited delegates. Both men wore dark suits with white shirts and ties and stood to attention as participants sang the national anthem.
In a brief speech, Putin said there was no intention to change the balance of power between the president and the prime minister in a future government.
Some commentators had speculated Putin might want to rewrite the constitution to beef up the role of the premier because most power resides with Russia’s president, who is commander of the armed forces, sets foreign policy and picks the prime minister.
Putin praised Medvedev as a man whose “main principles in life are the interests of its government and its citizens.”
He also announced a big pay rise of 14 percent for public sector workers, which will come into effect on February 1, just over a month before the election. The military will get 18 percent.
In a further sign of Putin’s intention to keep a grip on power next year, Russian media reported that Putin could send the Kremlin chief of staff to run Medvedev’s election campaign.
The Vedomosti newspaper said Kremlin chief of staff Sergei Sobyanin and possibly the main Kremlin political strategist, Vladislav Surkov, would head Medvedev’s campaign.
“For the first time a presidential candidate’s campaign staff will be headed by the Kremlin chief of staff,” Vedomosti wrote.
The Kremlin did not comment on Vedomosti’s report. In the past, successful heads of the election campaign have gone on to become chief of the Kremlin staff.
A senior United Russia source told Reuters the choice would mean Medvedev had a full set of Kremlin officials beside him as an extra assurance that he would stick to Putin’s agenda once elected.
“By doing so, Putin will in fact hand over to Medvedev his full staff which will smoothly carry on with what it is doing now,” the source said.
Opinion polls show more than 50 percent of Russians are ready to vote for anyone chosen by Putin. The Kremlin leader’s support helped United Russia win more than two-thirds of seats in the lower house of parliament in an election on December 2.
This victory would give Putin a powerful political base as prime minister.

TITLE: Criminal Investigation Sought Over Conscription
AUTHOR: By Galina Stolyarova
PUBLISHER: Staff Writer
TEXT: A scandal is brewing over alleged violations in the draft of a high school student into the army.
The St. Petersburg pressure group Soldiers’ Mothers is demanding a criminal investigation into the circumstances surrounding the drafting of Vladimir Timofeyev, an 11th-grade student at evening school No. 153. Ella Polyakova, the chairwoman of Soldiers’ Mothers claims the draft was illegal.
“It is against the law to draft pupils attending high schools,” Polyakova said. “Besides, the police grabbed Timofeyev and declared him eligible without even consulting his medical chart.”
Colonel Yury Klyonov, aide to the chief military commander of the Leningrad Military District argued that Timofeyev was drafted legally and no violations occurred in the process.
“Before he joined the evening school, Timofeyev had attended a railway college,” Klyonov said. The official accused Timofeyev of playing truant and poor conduct.
“While in college, he regularly skipped classes without a satisfactory reason and his grades were low,” Klyonov added. “And when at school he almost made a point of not attending lessons.”
Sergei Strelchenko, head of the St. Petersburg military-medical commission, told reporters on Monday that 6,194 local conscripts are officially listed as wanted by the police for dodging conscription.
Fear of hazing and of combat in Chechnya are causing so many young men to avoid the draft or desert the army that police are being pressed into service to round up conscripts. 
Yelena Filonova, a St. Petersburg-based lawyer, who used to work with the Soldiers’ Mothers organization and represented the interests of a number of conscripts in cases of alleged hazing or illegal drafting, said the police often use questionable tactics.
“The police can plant drugs or bullets in young men’s pockets and then offer them a choice between the army and prison. I would suggest sewing up big pockets,” Filonova said. “When arrested, they are not allowed to call home and their families may not know for months what happened to them, and of course they do not have a chance to protest.”
Sergei Yakushchenko, head of the draft department of the board of the Leningrad Military District, said the autumn draft plan was filled in its entirety, and 85 percent of new conscripts have already been sent to their military detachments.
Yakushchenko said no requests for alternative service were filed during the autumn draft.
Mothers of draftees often complain that the officers at military commissions laugh in their faces when they ask about their sons’ rights. They also say recruiters refuse to provide a list of illnesses that qualify one for an exemption and that military doctors regularly ignore severe illnesses during official examinations.
“Some of the mothers who come to us say that they would have been happy to pay a bribe but they do not have that kind of money,” Polyakova of Soldiers’ Mothers said.
Even top military officials admit that they are filling the armed forces with unfit soldiers. According to Igor Puzanov, chief commander of the Leningrad Military District, only about 10 percent of recruits satisfy the standard physical-fitness requirements.

TITLE: Changes Loom for SPS, Yabloko Political Parties
AUTHOR: By David Nowak
PUBLISHER: Staff Writer
TEXT: MOSCOW — One is talking about a change in leadership. The other is talking about changing its logo.
But after a disastrous performance in the State Duma elections and facing millions of dollars of debt, the liberal parties Yabloko and Union of Right Forces have managed to come to an agreement on one thing: Something has to change.
Yabloko announced Friday that it would not support its veteran leader, Grigory Yavlinsky, to run for president in the election in March but would instead back Vladimir Bukovsky, a Soviet-era dissident who has been living in London for years. 
In a further sign of a revolt taking shape in the Yabloko ranks, at least one senior member is calling for Yavlinsky to cede or share power in the party, which Yavlinsky has led since he co-founded it in 1995.
The Union of Right Forces, or SPS, is to hold a congress Monday at the Hotel Izmailovo in eastern Moscow to nominate co-founder Boris Nemtsov as its candidate for the March 2 election and conduct a postmortem on its disappointing performance in the Duma elections. One senior member has proposed a rebranding of the party.
Yabloko captured just 1.59 percent of the vote in the recent Duma elections, while SPS garnered just 0.96 percent. United Russia, whose ticket was led by President Vladimir Putin, won 64.3 percent of the vote.
But even before the Duma elections, figures from the Central Elections Commission for the past 14 years make for disturbing reading for liberal-leaning voters. At least 20 percent of the electorate voted for liberal parties in 1993, not including independents, many of whom also pushed a liberal agenda. 
Two years later, that figure dropped to around 15 percent, where it hovered through 1999 until 2003, when official results showed 10 percent voted for liberal parties.
It was in the 2003 elections that Yabloko and SPS dropped out of the Duma for good, failing to reach the 5 percent threshold, which has since been bumped up to 7 percent.
The two parties failed to garner 3 percent between them on Dec. 2.
Party officials insist that the last two Duma elections were riddled with fraud and that their results were in fact much higher.
But sociologists and political analysts say voters willing to support liberal parties are increasingly scarce. A core of 10 percent to 12 percent of the electorate is believed to still back liberal values.
Nonetheless, Yabloko, SPS, the libertarian Civil Force and the Democratic Party — which promotes joining the European Union — altogether garnered less than 4 percent of the Duma vote.
Around half of the 12 percent of liberal voters are “liberal economists,” said Leonty Byzov, head of the analytical section of state polling agency VTsIOM.
“They want free entrepreneurship and unhindered international investment opportunities,” Byzov said. 
“They realize that they can get this with United Russia without having to risk the political turmoil that an outside force coming into power would bring,” he said.

TITLE: Zyuganov Promises to Fight Medvedev in Vote
AUTHOR: By Dmitry Solovyov
PUBLISHER: Reuters
TEXT: MOSCOW — The Communist Party on Saturday nominated leader Gennady Zyuganov to run for president in March — a vote where he faces a daunting challenge against President Vladimir Putin’s preferred successor.
Putin has endorsed First Deputy Prime Minister Dmitry Medvedev, but Zyuganov said he would have a good chance if no candidate wins an outright majority in the first round.
“I believe we have a good chance in this election, and should this election be more or less fair, a second round of voting is inevitable,” Zyuganov told reporters at a party congress.
The Communists are the largest opposition party in the newly elected State Duma, but they received just 12 percent of votes, compared with 64 percent for United Russia. 
Zyuganov took Boris Yeltsin to a second round in the presidential election in 1996 but was roundly beaten by Putin four years later. He did not run against Putin in 2004.
Zyuganov’s first deputy, Ivan Melnikov, told the congress: “Now we must react more promptly, because the Kremlin’s calculations that its candidate will automatically get the rating of the current president is a theory that has yet to be proven in practice.”
Zyuganov, who has criticized the Duma elections as the dirtiest on record, said he reckoned that the Communists enjoyed the support of at least one-third of voters. “This is very serious and solid support,” he told reporters.
Upbeat and bellicose, Zyuganov said Yeltsin and Putin had both shirked in the past his proposal to hold public debates.
“[The authorities] are afraid of an open political rivalry,” he said. “I officially invite United Russia’s new presidential candidate to such a dialogue.”
The Communist Party’s central committee approved Zyuganov’s candidacy on Friday, and it was rubber-stamped by congress on Saturday. In the lobby of the congress, held in a Soviet-era state farm on the edge of Moscow, posters of Stalin and books about the dictator sold like hot cakes.
Zyuganov, in his speech, said: “We admit some of the mistakes made in the past. 
But at the same time we want to remind you that it was in Soviet times when our nation became a real superpower and was the first to go into space.”
Decrying low pensions and widening social inequality, he said: “The Communist Party insists on nationalization of natural resources and strategic sectors of industry.

TITLE: MN to Stop Publishing on January 1
AUTHOR: By Max Delany
PUBLISHER: Staff Writer
TEXT: MOSCOW — It may have outlived perestroika and survived the Yukos affair, but now financial problems seem to have sunk the weekly newspaper Moskovskiye Novosti.
Following a management meeting, the publication’s parent company, Obyedinyonniye Media, announced Friday that the newspaper would stop publishing from Jan 1.
Obyedinyonniye Media, owned by Israeli-Russian businessman Arkady Gaidamak, also runs a host of other media outlets, including the radio station Business FM.
The company also prints Moskovskiye Novosti’s sister English-language edition, The Moscow News, in partnership with RIA-Novosti, the state news agency.
It was not immediately clear how Friday’s announcement would affect The Moscow News.
“We do not see any commercial profit in continuing the development of Moskovskiye Novosti in its current format,” Daniil Kupsin, general director of Obyedinyonniye Media, said in a statement.
The newspaper could however be relaunched at some future date in a new format, the statement said.
“A decision has been made to redirect efforts into creating and developing successful media projects that are more cost-effective and profitable,” it said.
During the 1980s, Moskovskiye Novosti rose to prominence as a leading champion of Soviet leader Mikhail Gorbachev’s policies of glasnost and perestroika. 
Friday’s news also spells the end for the paper’s current editor, veteran newsman Valery Tretyakov. Tretyakov, who founded independent daily Nezavisimaya Gazeta in 1990, was appointed editor in January 2006.

TITLE: Briton Charged With Murder
AUTHOR: By David Nowak
PUBLISHER: Staff Writer
TEXT: MOSCOW — A British citizen is in custody on suspicion of killing his new wife and her grandmother in their apartment in the Tver region, investigators said.
William Cocks, 52, has admitted to killing the two and has been charged with murder, the Tver branch of the Investigative Committee said Friday. If convicted, he faces life in prison.
Cocks was found unconscious in the apartment in the town of Udomlya on Dec. 3 with a dozen stab wounds to his lower arms, which investigators believe were self-inflicted, said Karina Begetova, a spokeswoman for the Investigative Committee.
The bodies of his wife, Irina Cocks, a 35-year-old former stripper, and her grandmother, Vera Romanova, 82, were found in an adjacent room, Begetova said.
Irina Cocks was found with 44 stab wounds, mainly to her neck, chest and stomach, she said. Romanova had four stab wounds to the neck.
Begetova said a preliminary investigation indicated that Cocks killed the two women and then attempted suicide by slitting his wrists on Dec. 2.
Asked about the case, a British Embassy spokesman said only that “an individual” was being afforded “all appropriate consulate assistance.”
Begetova said investigators had no idea what had prompted the killings and were “not ruling out a motive linked to the occult.”
Tarot cards were found scattered on the floor of the room where the wife and grandmother were found, she said. A stripper’s pole was also found.
Cocks was taken to Udomlya’s main hospital, where he was in stable condition, Begetova said.
He and his wife, who shared a love for biking, married in November, Begetova said. They met in 2004 in Spain, where he was on vacation and she was working as a stripper in a club. William Cocks moved to Russia in 2006, and in August, Irina suggested that they move with the grandmother into the apartment in Udomlya, Begetova said.
Cocks’ sister, Susan Irwin, 56, said he had a mental breakdown last year, Britain’s Sun reported Saturday.
Cocks’ daughter Hannah, 22, told the paper: “I had a couple of calls saying he was all right. He told me his girlfriend was into witchcraft, she was a psychic.”
She added, “My dad is just a normal guy who likes going to the pub with his mates. But he wasn’t well last year. He kept saying someone was going to kill him. He was getting paranoid so he went to a mental hospital for 28 days.”
Begetova said Cocks would be placed in a pretrial detention center once doctors deemed him healthy enough to be moved.
“We need at least two months to establish his mental condition, which means obtaining his medical history from his doctor in Britain,” she said.

TITLE: Armenian in Moscow Mixes Chemicals and Culture
AUTHOR: By Marina Kamenev
PUBLISHER: Staff Writer
TEXT: MOSCOW — David Sarkisyan, the director of the Shchusev Architecture Museum, often lets it drop that he has lived four lives.
“I am exceptionally lucky as a person, because despite having four professions I have never ‘worked,’ my wage was always small, but I only did things that I liked, I am one of the happiest people in the world,” he said.
Born in Yerevan, Sarkisyan came to Moscow to study when he was a teenager. He has dabbled in professions ranging from science to film. This year he turned 60 and has been enjoying his fourth life as director of the Shchusev Architecture Museum for five years.
Sarkisyan was always attracted to science.
“I have nothing against religion, but I am 100 percent — no, a 200 percent atheist,” he said.
“I respect many religious people but I do not believe in a God, I do believe in the reality of this life and I think the only way to find out more about it is through science.”
He studied physiology at Moscow State University.
“After I finished, I had the best three years of my life, I did absolutely nothing but read ... under a system known to us as a postgraduate program,” he laughed.
“You do an exam on philosophy, which was essentially Marxist at the time, you do a test on another language, and I already knew English fluently, and you get to do some kind of experimental investigation, which no one supervises or reads, so it was a three-year rest.”
After Sarkisyan finished his postgraduate degree, he went on to do a doctorate in pharmaceuticals, but never completed it and started working as a pharmacist. For 15 years he studied the nervous system through many experiments. “In those 15 years, hundreds of white rats died in my hands,” he said with a tinge of regret.
Sarkisyan said he discovered a nerve stimulant that was thought initially to be harmful, and invented a medicine called ipidacrine, which is used in Japan to help treat diseases such as Alzheimer’s.
Perestroika signalled the end of many things in Sarkisyan’s life. He stopped working in pharmaceuticals, divorced his wife and walked into a completely different field almost by accident.
Sarkisyan had an acquaintance, Rustam Khamdamov, who was trying to get out of Russia. Sarkisyan had many connections at that time and, as he became friends with Khamdamov, found out that he was a filmmaker and the reason he wanted to get out of Russia was to make more movies. “I convinced him that he did not need to leave Russia to make films, and that is how we started working on something together,” Sarkisyan said.
Sarkisyan was the first assistant director of the movie “Anna Karamazoff,” written and directed by Khamdamov. Starring French actor Jeanne Moreau, it went to Cannes, but was never released due to problems with the French producer.
“At 44 ... I walked on the red carpet next to Jeanne Moreau,” Sarkisyan said. “It was a glamorous end to my career in film,” he said.
“While all my friends were becoming oligarchs and politicians, two things I could have easily done myself, I chose to do television documentaries. At this time it was free — I had access to all the archives and I could make films about everything that I was interested in,” he said.
Sarkisyan admitted that most of his films were not professional, “but they were all ideologically fresh, they always had something new,” he said.
The film of Sarkisyan’s still shown today is “Comrade Kollontai and her Lovers,” a documentary about the revolutionary Alexandra Kollontai. “I was always great with titles,” Sarkisyan said.
In 2001, a friend told Sarkisyan about the Shchusev State Architecture Museum, and the chance of running it.
“I was not interested so much in architecture but in the museum,” he said.
“Most people are idiots, and they produce cultural porridge that they have managed to transfer into the rest of civilization, idiotic things like astrology. The museum is an island in this sea of rubbish and is the only way to preserve real culture,” he said.
Bolshoi Gorod magazine’s art critic, Yekaterina Degot, praised Sarkisyan’s work at the museum.
“I think Sarkisyan has created an amazing space for contemporary culture and exhibitions,” she said. “I am always interested in what is going on there, and it’s somewhere I frequent with my friends.”
Sarkisyan is not modest when giving advice on being a museum director. “Running a museum is like being a president, it’s not something you can train for,” he laughed. “If you need to ask how to do it, you’re not right for the job.”

TITLE: Swiss Man Asks Minsk for Asylum, Then Leaves
AUTHOR: By Natalya Krainova
PUBLISHER: Staff Writer
TEXT: MOSCOW — A Swiss citizen who asked for refugee status in Belarus has returned to Switzerland without explanation after spending 10 days in the country, Belarussian officials said.
The Swiss asylum seeker, 32, entered Belarus on Nov. 28 at a checkpoint on the Poland-Belarus border, saying he wanted to live and work in Belarus, said Vitaly Aksyonov, head of the citizenship and migration department in the Brest region of Belarus.
Aksyonov dealt directly with the request of the Swiss man, whom he declined to identify at the foreigner’s request.
“He filled out an application for refugee status,” Aksyonov said Friday.
Since he had no entry visa, applying for asylum was the only way the Swiss man could be allowed into Belarus, Aksyonov said.
The man cited no political motives for leaving Switzerland. “Nobody oppressed him there,” Aksyonov said.
The Swiss man arrived at the border driving a Lada with a collection of books authored by Bolshevik leader Vladimir Lenin in the trunk, Noviye Izvestia reported Friday. He claimed that Belarus, Venezuela and Cuba were the best countries in the world.
While his asylum application was being processed, Belarussian authorities checked the foreigner into a hotel in Brest and allowed him to move around the city of 300,000, which is located near the Polish border, Aksyonov said.
The one condition was that he return to the hotel before 11 p.m. for safety reasons.
“Such a decision was made because it gets dark early in winter, and the man doesn’t know the city and could easily get lost,” Aksyonov said. “We didn’t have the means to provide him with a personal guide to show him around.”
The Belarussian migration service began preparing the Swiss man’s asylum paperwork, but before it could be completed, the would-be refugee suddenly changed his mind and left Belarus on Dec. 7, Aksyonov said.
Belarussian Interior Ministry spokesman Oleg Slepchenko and Belarussian Border Guard Service spokesman Yury Kozachenko confirmed the curious case but would not provide further details.
Komsomolskaya Pravda suggested on Friday that the asylum application might have been a scheme dreamed up by the Swiss man to get a free 10-day vacation — a theory Aksyonov dismissed.
“I don’t think so, because he didn’t go anywhere else [in Belarus] except Brest,” Aksyonov said. “He could have bought a [train] ticket for himself and gone anywhere he wanted. He had money with him.”
A Swiss Embassy official in Minsk said by telephone that the embassy was aware of the case from the media but that it could not get involved because the country in which a refugee asks for asylum has no right to disclose information about the applicant. “Especially to the country where he is from,” said the official, Dietrich Dreyer.
Swiss authorities will not investigate the case, Dietrich said. “Switzerland is a free country, and any of its citizens can do whatever he wants,” Dietrich said.
Belarus has been dubbed in the West as Europe’s last dictatorship. In April 2006, Belarussian President Alexander Lukashenko signed a decree simplifying the procedure for granting asylum to foreigners.

TITLE: Postponement In Khlebnikov Case
PUBLISHER: The Associated Press
TEXT: MOSCOW — A court on Monday postponed the retrial of two men accused in the 2004 murder of the American editor of Forbes magazine’s Russian edition because one of the men is still missing, a court spokeswoman said.
The trial of those suspected in the killing of Paul Klebnikov has been in limbo since the Supreme Court overturned their acquittal by a jury and ordered a new trial.
The Moscow City Court was to begin a closed-door retrial Monday, but instead returned the case to prosecutors while authorities continue searching for Kazbek Dukuzov, who disappeared earlier this year, court spokeswoman Anna Usacheva said.
Another man, Musa Vakhayev, remains in Moscow, while a third man linked to the case, Fail Sadretdinov, was convicted in January on an unrelated crime and sentenced to nine years in prison.

TITLE: In Brief
TEXT: <b>Sponsor For Admiralty</b>
ST. PETERSBURG (SPT) — A sponsor, who preferred to remain anonymous, gave 100 million rubles ($4 million) for the restoration of the Admiralty tower and sculptures, Interfax reported on Saturday.
The sponsorship was offered at the auction of the second Gifts Store for St. Petersburg’s Birthday that was held on Friday.  The auction offered 17 St. Petersburg monuments in need of restoration.  All the sites on offer for renovation were bought by large companies or private sponsors, who will allocate their money for the restoration works.

<b>World Ice Show</b>
ST. PETERSBURG (SPT) — World ice skating stars will perform in a unique show to take place on Moscow and St. Petersburg’s main squares on Wednesday.
The Two Capitals Ice Show will be held at the outdoor skating rinks built on Moscow’s Red Square and St. Petersburg’s Palace Square.
Moscow’s show will host Olympic champion ice skater Alexei Yagudin, Irina Slutskaya, Maria Petrova and Alexei Tikhonov, Yekaterina Gordeyeva and many other stars.
In St. Petersburg, the show will feature Olympic champion Yevgeny Pluschenko, Tatyana Navka and Roman Kostomarov, Sasha Cohen, Olympic silver medallist Stephan Lambel, Olympic bronze Pillip Kandeloro, and others skaters.
Tickets for the show will cost from 1,000 rubles ($41).

<b>Death In Metro</b>
ST. PETERSBURG (SPT) — An unknown man was found dead in a tunnel of the St. Petersburg metro between Sadovaya and Dostoyevskaya metro stations on Monday afternoon, Interfax reported on Monday.
An emergency brigade was sent to the tunnel. The identity of the dead person and the reasons for the death are being investigated.

<b>Truck Line</b>
ST. PETERSBURG (SPT) — About 1,800 trucks were stuck in a queue to enter Russia on the border of Latvia and Russia as of Saturday morning, Interfax reported.
The huge lines of trucks began to appear on the border in the middle of August last year, leading to complaints from local residents.

<b>Ryzhkov Won’t Run</b>
MOSCOW (SPT) — Outgoing independent State Duma Deputy Vladimir Ryzhkov said Friday that he would not run in next year’s presidential election.
“After serious consideration, I have decided not to participate in the presidential election in March,” Ryzhkov said in a statement, Gazeta.ru reported.
Ryzhkov, a leading liberal politician, said one of the reasons he decided not to run was the fact that the Supreme Court this year ordered that his Republican Party be disbanded for failing to adhere to a law that requires parties to have at least 50,000 members and 45 regional offices. Without a party to nominate him, Ryzhkov would have to collect 2 million signatures to get onto the ballot. 

<b>Gunbattle Kills 5</b>
MOSCOW (Reuters) — Four Chechen rebels and a police officer were killed in a gunbattle in Grozny, Chechen Interior Minister Ruslan Alkhanov said Sunday.
The group of three men and one women resisted arrest during a search of a residential district in the city on Saturday night, sparking a conflict that lasted until early Sunday, Alkhanov said.

TITLE: An Ideal Soviet Man Has the Trust of the President
AUTHOR: By Francesca Mereu
PUBLISHER: Staff Writer
TEXT: PRIOZERSK, Leningrad Region — When duty called, a young Viktor Zubkov donned his old pants and black rubber boots to clean stables and check heating pipes.
He developed a reputation for barking orders and expecting quick results. Women fawned over him, but he only had eyes for his wife.
This is the person — the ideal Soviet man — whom President Vladimir Putin has selected to lead the government in the crucial months before next year’s presidential election, according to people who know him.
“Alexeich was a very energetic young man, and he would help us every time we needed it,” said Konstantin Mikhailov, a former farmhand who worked under Zubkov for a decade at the Razdolye collective farm. “He wasn’t even afraid of going into a stable and walking in manure when needed.”
Mikhailov, 75, referred to Zubkov as “Alexeich,” a short form of Zubkov’s patronymic and a folksy way of showing respect. Zubkov took over the farm in Priozersk, a district in the Leningrad region, in 1970 at the age of 29.
“Alexeich was a really good man,” Mikhailov said, nodding his head and smiling with evident affection for his former boss.
The old farmhand’s enthusiasm is shared by others. “He was always sent where there were problems to solve,” said Raisa Kuzmenkova, who served as his deputy director at Pervomaiskoye, an association of seven collective farms in the Priozersk district. Zubkov was made general director of Pervomaiskoye in 1982, after 12 years at Razdolye.
“He sorted things out at Razdolye and was sent to Pervomaiskoye, where he had to begin from scratch again,” Kuzmenkova said.
“Now he has to sort things out for the whole country,” she said. “At first I thought that becoming prime minister was the wrong career move for him, but after I saw how confident he was, I became convinced that Vladimir Vladimirovich [Putin] had made the right decision.”
Putin named Zubkov as prime minister in September, just as the country entered a critical election season that will end with Putin’s expected departure from the Kremlin in May. Putin’s surprise decision came days before news broke of a fierce power struggle among the Kremlin’s siloviki clan. At this crucial moment for Putin’s Kremlin, the president turned to Zubkov, an old ally and former subordinate from St. Petersburg City Hall.
“Viktor Zubkov is a professional, honest, judicious, responsible and wise man. He is a man with character and with great experience,” Putin said shortly after the appointment.
Putin touted Zubkov’s experience at Razdolye. “He was once thrown into the worst collective farm, it was dying, and he transformed it into the best enterprise in the Soviet Union,” he said, adding that he had to speak out because the prime minister was too modest to mention his own accomplishments.
Zubkov’s office declined repeated requests over six weeks for an interview. Requests to accompany him on one of his trips to the regions were also rejected.
Zubkov appears to be serving a transitional role, and he might give up his office in May to none other than Putin himself. Dmitry Medvedev, the first deputy prime minister named by Putin as his preferred successor, said this week that Putin would be his ideal candidate for prime minister.

Humble Beginnings
Zubkov’s career started far away from the seat of government in the White House. He was born on Sept. 15, 1941, in the village of Arbat in the Sverdlovsk region, where his parents moved from Monchegorsk, in the Murmansk region, during World War II. Arbat — also called Kaban, or Wild Boar, for the high population of wild pigs in the area — no longer exists.
After the war, Zubkov’s family returned to Monchegorsk, and the young Viktor attended school there. He landed his first job at 17 at the local Severonikel mining plant, where he worked as an apprentice for two years. In 1960, he left for Pushkino, in the Leningrad region, where he graduated with a degree in economics from the Agriculture Institute.
After two years of military service, he worked as a collective farm manager in the Leningrad region from 1967 to 1985. Friends said it was at the farms that Zubkov learned how to bark orders.
“When I saw him on television rebuking the poor ministers, I felt like I was going back in time to one of his meetings, and I thought that my turn to be rebuked was next,” Kuzmenkova said.
Zubkov took ministers to task during televised Cabinet meetings in October for not acting quickly enough. The meetings have since been closed to outside eyes, apparently after several ministers complained about being dressed down in public.
Zubkov, a member of the Communist Party from 1967 to 1991, entered politics in 1985, when he was appointed the head of Priozersk, the commercial center of the district where his farms were located. The town of 20,000 people, located in the Karelian Isthmus, where the Vuoksa River runs into the scenic Ladozhskoye Lake, is a tourist magnet in summer, but the streets were empty on a recent cold and gloomy winter afternoon.
“His style was brusque and tough, but he was always fair with the people who worked with him,” said Lyudmila Kedrova, who worked as a secretary of the Priozersk executive committee. Zubkov was the committee’s head.
“He would rebuke people and punish them, but he would never raise his voice or fire anyone,” she said.
Kedrova recalled that the temperature reached minus 40 degrees Celsius in the winter of 1986, and the town faced the threat of being left without heat as water froze and heating pipes burst. Zubkov put on his rubber boots, an old jacket and a hat and visited the basements of Priozersk’s apartment buildings to make sure the pipes were in order, she said.
“He went into apartments to tell people to move their stoves close to the radiators so the pipes wouldn’t burst,” she said.
Zubkov dispatched municipal workers to the heating stations to make sure each was working properly and had enough coal to keep the boilers hot, said Yevgeny Krasov, a member of the Priozersk executive committee at the time.
“He knew every single worker by name and patronymic,” he said.
Krasov described Zubkov as a fair, but “very challenging and overly meticulous boss.”
“He demanded a lot from us, but he also taught us a lot,” he said. “We would bring documents to him, and he would read them carefully and correct mistakes. After that we had to rewrite them, and only then would he sign them.”
The Road to Moscow
Zubkov was promoted to the post of first deputy head of the Leningrad region’s executive committee in 1989, but he lost the job two years later with the Soviet collapse. He served under Putin in St. Petersburg’s foreign relations committee for 10 months, from 1992 to 1993.
Speaking with Zubkov, Putin used the formal “vy” form of address, while Zubkov used the more familiar “ty,” said Stanislav Belkovsky, a former Kremlin spin doctor.
During his stint in City Hall, Zubkov is thought to have helped Putin, Federal Drug Control Service head Viktor Cherkesov, Federal Security Service chief Nikolai Patrushev and other current state officials get land for dachas in his old Priozersk district.
Zubkov was later made deputy chief and then chief of the St. Petersburg Tax Service. In 1998, he unsuccessfully tried to run for Leningrad governor, and Boris Gryzlov, now the head of United Russia, was his campaign manager.
During the presidential election in 2000, Zubkov headed a St. Petersburg initiative group that supported Putin’s bid, and the next year he was offered a job in Moscow as the head of the Federal Financial Monitoring Service, which fights money laundering.
Zubkov joined the agency as the Kremlin began a campaign against the wealthy businessmen who had made fortunes through controversial privatization deals in the 1990s. A highlight of Zubkov’s career was Russia’s removal from a blacklist drawn up by the Financial Action Task Force, an international body that combats money laundering.
Zubkov’s televised visits to the regions as prime minister are reminiscent of his outings as a farm director, Kuzmenkova said.
“This is the old Zubkov,” she said. “I saw him on television, and he hasn’t changed. He loved to meet with people, to rebuke some, to talk to others, to hug people and listen to their problems.”

An Ideal Soviet Man
Friends and former colleagues described Zubkov as the ideal Soviet man. He would get up early in the morning to go jogging. He loved skiing. On weekends, he went fishing in one of the numerous lakes in the Priozersk district.
Zubkov enjoyed bathing in a hot banya, but he refused to drink vodka there, as many Russians traditionally do, former colleagues said.
He also went shopping for his wife, which was unusual for men at the time.
“We once were walking together home after work and he told me that he needed to go to the shop to buy some window cleaner. His wife had asked him,” Kedrova said.
“But the shopkeeper told him that they had run out of window cleaner because alcoholics had bought it,” she said.
Kedrova said Zubkov was shocked to learn that people would drink window cleaner and even perfume, and he raised the issue at the next meeting of the town’s executive committee.
She said Zubkov never used his status to seek perks. “He would stand in line like everybody else at the time,” she said.
The Zubkovs lived in an ordinary three-room apartment decorated with standard Soviet wallpaper and furniture, Kuzmenkova said.
Krasov said the executive committee had only one car at its disposal and that Zubkov would walk if anyone else needed it.
Zubkov loved to dress well and was quite dashing as a young man, Kuzmenkova said. 
When he was farm director, women would think up all kind of problems just to talk to him in his office, but Zubkov paid no attention to their advances, she said.
Zubkov and his wife have one daughter, Yulia, who is married to Defense Minister Anatoly Serdyukov.

TITLE: Norilsk Feud Delays Sale of Assets
AUTHOR: By Catrina Stewart
PUBLISHER: Staff Writer
TEXT: MOSCOW — Shareholders blocked the spinoff of Norilsk Nickel’s energy assets Friday in an anticipated move that casts a pall over the miner’s development plans. 
Mikhail Prokhorov’s Onexim Group, which is in the process of selling its 25 percent plus one share stake in the palladium and nickel miner, abstained from voting at Friday’s extraordinary shareholders meeting, said Alexei Rebinkin, a spokesman for Onexim. 
Rebinkin said the new shareholder — expected to be either Vladimir Potanin’s Interros Group or Oleg Deripaska’s United Company RusAl — should make a decision about the future of EnergoPolyus, the proposed power company, not Onexim. 
The decision was widely expected given Prokhorov’s statements earlier in the day and previously that he would not approve the spinoff, which would have created a $7 billion power company, including its 65.2 percent stake in power generator OGK-3. 
After the meeting, Norilsk chief executive Denis Morozov expressed his disappointment but said the management would review other options, including a strategic sale of the power unit. The spinoff could be reviewed within one or two months, he said. 
Prokhorov and Potanin are currently embroiled in a protracted split of their assets after 15 years of working together. Prokhorov gave his former partner first right of refusal on the stake but has set a steep price of $15.7 billion, which Potanin must raise within 45 days. He has until Thursday to accept the offer. 
Prokhorov has said he favors selling his stake to RusAl in return for cash and an 11 percent stake in the aluminum giant plus a seat on its board. The RusAl deal will go ahead if Potanin does not accept the offer first. 
Morozov said the disagreements between Potanin and Prokhorov were starting to affect the company. “This is not positive,” he said. “No one has given us any plans for development.” 
Plans to spin off Norilsk’s noncore power assets were first announced in March, and it was envisioned that Prokhorov would focus on the energy side of the business, while Potanin would take control of the miner. 
“Whilst it’s clearly disappointing, it’s a stalling tactic and we expect it to come back on the agenda once Onexim has sold its stake to RusAl,” said Rob Edwards, a Renaissance Capital analyst. 
He said RusAl had its own portfolio of power assets centered on its operations in Siberia and that EnergoPolyus’ portfolio would not provide a good fit. 
“I am firmly of the belief that RusAl will want to get rid of these as well,” Edwards said. 
Ahead of the meeting Friday, Prokhorov said in a statement that he would offer Potanin a formal deal to split their assets in KM-Invest, which includes an 8 percent stake in Norilsk. Prokhorov proposes either selling the assets and splitting the proceeds, or buying out Potanin’s share or vice versa. If Potanin does not accept the offer, Prokhorov said he would consider legal proceedings to break up the holding. 
Mandated lead arrangers ABN Amro, BNP Paribas, Credit Suisse and Merrill Lynch are leading a $4.5 billion syndicated loan backing RusAl’s bid for Prokhorov’s stake, banking sources said Friday, Reuters reported.

TITLE: Ford Strikers Resume Work, Talks Continue
AUTHOR: By Irina Titova
PUBLISHER: Staff Writer
TEXT: Ford Motor Company workers ended a strike that had lasted for almost a month in Vsevolozhsk, Leningrad Oblast, at midnight on Sunday.
“We are very pleased with the decision taken by the trade union that will allow all employees to get back to work from Sunday midnight and start earning their salaries again in this period leading up to the winter holiday season,” said Theo Streit, the plant’s director, according to Ford’s press service. 
Negotiations on the new 2008 labor contract package were due to begin Monday, Streit said.
The decision to stop the strike was taken on Friday when the plant’s trade union and the administration signed an agreement on a schedule of further negotiations to last until Feb. 2008.
Alexei Etmanov, head of the plant’s trade union, said he didn’t consider the ending of the strike to mean failure.
“It’s neither a failure nor a victory for any side. It’s just a new stage in the struggle for our interests,” Etmanov said.
Etmanov said the workers have high hopes for the further negotiations.  So far, the plant’s administration has offered the workers an 11 percent raise beginning March 1 to compensate for inflation. However, the workers hope for a bigger raise.
750 workers continued the strike right up until the last moment, Etmanov said. They were the majority of the 1320 assembly line workers who are the ones to actually assemble and paint the cars. However, they are paid the lowest salary out of all other employees, he said.
Etmanov said the strike had been helpful for the interests of the workers.
“Besides, it was probably the first strike in Russia over the last 10 years that was held for such a long period of time and on a legal basis,” he said.
Etmanov said that by their calculations, as a result of the strike the plant failed to produce about 5,000 cars.
The strike began on Nov. 20.  The workers’ main demand was to receive a salary increase from 19,000 rubles to 28,000 rubles. As a result of the strike, the plant’s administration had to stop the assembly line and limit the access of workers to the plant.  On Nov. 28 the plant resumed one shift of its work, and on Dec. 10 it began to work a second shift.  Normally the plant works in three shifts.

TITLE: Belarus Set To Pay 19 Percent More for Russian Gas in 2008
PUBLISHER: Combined Reports
TEXT: MINSK —Belarus will pay 19 percent more for Russian gas beginning next year, Gazprom said Saturday, a day after President Vladimir Putin announced $1.5 billion in loans to help its economy adjust to rising prices.
The announcements came after Putin paid a two-day visit to Minsk, which yielded no signs that the two countries were inching toward a full merger.
Following a dispute over energy prices at the beginning of the year, Gazprom forced Belarus to accept a doubling of gas prices this year —to $100 per thousand cubic meters —and an unspecified increase for 2008.
Sergei Kupriyanov, a spokesman for Gazprom, said Saturday that Belarus would pay $119 as of next year.
Belarussian government officials refused to comment on the announcement, but the increase was apparently less than what they had feared. Minsk government sources had earlier said Moscow was seeking an increase of up to 60 percent for 2008. Lawmakers on Thursday passed a 2008 budget that forecast a price of $125.
In announcing the $1.5 billion loan during his visit to Minsk on Friday, Putin promised that rates would not rise beyond gradual increases set out last year.
In recent years, Gazprom has moved to end energy-supply subsidies to former Soviet republics; several countries, including Georgia, Ukraine and Azerbaijan, have seen sharp hikes in prices, and some critics accuse Russia of using energy prices to punish Western-leaning governments.
Putin’s visit to Belarus produced calls for closer cooperation but yielded no signs that the neighbors were moving toward the creation of a unified state. The two countries signed an agreement in 1996 that envisioned close political, economic and military ties, but efforts to achieve a full merger have foundered.
Before Putin’s arrival in Minsk, there had been intense speculation that he could be seeking to use the union to provide him with a power base after he steps down as president next year. But at the talks, President Alexander Lukashenko dismissed this. 
“I was surprised to see the visit triggered such a fuss in the West,” Lukashenko said. “There are no political connotations here. We are friendly and allied states, and I would be surprised if there was no official visit. ... There is nothing extraordinary here.”
Lukashenko also repeated an earlier statement that Belarus would join forces with Russia in opposing U.S. plans for a missile shield in Europe. 
“Belarus is ready to play its role in the issues of planned deployment in Europe of U.S. missile defense systems,” he said. 
He did not say what form his country’s assistance might take, but a Russian general last month suggested deploying missiles in Belarus in retaliation for the proposed U.S. missile shield. 
Arkady Dubnov, a political commentator for Vremya Novostei, speculated that Putin had sought Lukashenko’s support for a deployment of Russian forces in Belarus, which hosts a Russian-operated early-warning radar system and a limited number of Russian military personnel. 
AP, Reuters

TITLE: Georgia Cuts Growth Rating
PUBLISHER: Reuters
TEXT: TBILISI, Georgia — Georgian Finance Minister Nika Gilauri halved his forecast for 2008 economic growth on Friday, saying political turmoil had scared off foreign investors. 
“We had been forecasting for 2008 10 percent to 12 percent GDP growth, but now, after mass protests and political disorder, we expect GDP to grow by only 5 to 6 percent next year,” Gilauri said in a telephone interview. 
In November, President Mikheil Saakashvili ordered police to force opposition protesters off the streets of the capital, Tbilisi. Saakashvili then imposed a weeklong state of emergency and called a snap presidential election for Jan. 5. 
Both overseas investors and economic institutions have said the political uncertainty and street clashes have tarnished Georgia’s image. 
“What we have managed in the last two years is to win trust from many foreign investors, but now they are waiting. They are in waiting mode,” Gilauri said.

TITLE: Latvia Agrees To Pay Gazprom Up To 50% More For Gas Supplies
PUBLISHER: Reuters
TEXT: RIGA — Latvia’s gas company said Friday that it had struck a gas supply deal with Gazprom for 2008 through 2010, which could lead to a rise in prices of up to 50 percent, depending on heavy fuel oil price changes.
Latvijas Gaze, 47 percent owned by E.On Ruhrgas and 34 percent by Gazprom, did not give an exact figure for how much it would pay in a statement released Friday.
Gazprom has been trying to move all its former Soviet customers to West European prices, which were about $260 per 1,000 cubic meters and which Gazprom has said will be about $350 in 2008.
Latvia, like its Baltic neighbors, is completely dependent on Russia for gas, though the whole region accounts for only a small part of Gazprom’s exports at 4.9 billion cubic meters in 2006, compared with a major customer like Ukraine at 59 bcm.
Latvijas Gaze said the rise in prices it expected to pay for gas was because of the rise in the price of fuel oil, up from about $240 per ton in January to $506 now.
It said it expected supplies of gas in its underground storage unit, which were bought at lower prices earlier this year, would last until April.
From April, the price rise would depend on the average price of the previous six months of fuel oil.
If this were from $400 to $500 per ton, then the rise in the price of the gas it buys would be between 20 and 50 percent from the December 2007 price.
If the average price of heavy fuel oil falls to $350, then the price rise would be about 7 percent, it added.
It said it would make a loss of between 5 million Latvian lats ($10.43 million) and 30 million Latvian lats ($62.60 million) in 2008, if oil prices rise further and if tariffs for domestic customers are not increased.

TITLE: Medvedev Would Tip Scales in Favor of Gazprom
AUTHOR: By Anatoly Medetsky
PUBLISHER: Staff Writer
TEXT: MOSCOW — If elected president, Dmitry Medvedev will most likely tip the scales in favor of Gazprom in any new acquisitions and help the state-controlled gas giant with domestic prices and taxes.
In a senior role after he leaves office, outgoing President Vladimir Putin could balance the business interests of Medvedev, currently Gazprom board chairman, said Konstantin Simonov, director of the Fund for National Energy Security.
Simonov speculated that Gazprom could also resume efforts to take over Rosneft, the state-controlled oil company chaired by Kremlin deputy chief of staff Igor Sechin. A merger between the firms fell apart in 2005 after Rosneft acquired Yukos’ main production unit.
Konstantin Reznikov, an analyst at Dresdner Kleinwort, said a merger looked unlikely but the two firms could avoid impinging on each other’s sectors.
“The bigger the company, the more complicated its management, strategy and planning,” he said. “There’s no competition between the two companies. It doesn’t hurt them to work separately.”
Gazprom will, regardless, likely enjoy an edge over Rosneft in any acquisitions in the oil and gas sector, Simonov said. “I think that ... Medvedev will by all means encourage such deals,” he said.
Rosneft spokesman Nikolai Manvelov declined to comment.
Gazprom has an appetite for electricity assets, having gobbled up control or large stakes in the generating companies that supply Moscow and St. Petersburg and two more that cover several regions of Siberia and southern Russia. These four companies were spun off from state utility Unified Energy System.
UES chief Anatoly Chubais last month vowed to resist any further expansion into electricity by Gazprom, saying it would create a new monopolist.
UES spokeswoman Marita Nagoga said, however, that the state utility would not see a Medvedev presidency as a threat to competition.
“I don’t think Medvedev wants to kill a 10-year reform by destroying competition in the sector. I would never believe this,” Nagoga said. “As Gazprom chairman, he was very reasonable about this.”
Gazprom’s current energy holdings — Mosenergo, TGK-1, OGK-2 and OGK-6 — are placed in different “price zones” and therefore do not encroach on competition, Nagoga said.
Gazprom spokesman Sergei Kupriyanov said the company had no concrete plans for electricity acquisitions, but would not rule them out either. He declined to comment on how a Medvedev presidency would affect the company.
Gazprom has expressed interest in TGK-7 and a joint venture with coal miner SUEK that would control TGK-13 and Kuzbassenergo, said Dmitry Terekhov, an analyst at Antanta Capital. That would severely undermine competition on the market, he said.
Medvedev would probably think longer than Putin before giving Gazprom a monopoly position in electricity, Terekhov said. “Medvedev is more liberal,” he said. “He hasn’t served in the security agencies, at least.”
Medvedev could also face a looming conflict between Gazprom and industrial gas consumers when domestic prices are scheduled to reach netback parity with those in Europe in 2011.
“There’s a risk that a bunch of lobbyists come to Medvedev and say, ‘If you raise gas prices, it will be a catastrophe,’“ Simonov said. “I think Medvedev will continue to implement this idea, but it’s hard to predict how it will turn out.”
Oleg Zhilin, vice president of industry lobby group the Russian Gas Society, was confident that Medvedev would safeguard the efforts to raise Gazprom’s domestic margins. 
The government this month backed a 25 percent hike on domestic gas prices.
Medvedev could resist dramatically raising taxes on the gas industry, analysts said. Gazprom shares took a dive at the start of the year on the back of a government proposal to sharply raise the gas extraction tax. As first deputy prime minister, Medvedev managed to put off the measure, which was backed by the Finance Ministry and the Economic Development and Trade Ministry. 
A government working group is developing a system that would increase the tax if gas prices go up, but would give tax holidays for greenfield projects in east Siberia with its nonexistent roads and pipelines, Zhilin said.
Andrei Illarionov, a former economic adviser to Putin who is now a harsh critic of government policy, said Medvedev had been so colorless during his days as Kremlin chief of staff and first deputy prime minister that it was tough to guess what he would do as president.
“He has not been known for anything that could be considered his personal [view] on any idea, any project, any movement, any action,” Illarionov said. “That is why it is very hard to foresee in which particular area, or in any area at all, he will be able to demonstrate his interests.”

TITLE: In Brief
TEXT: <b>Elite Apartment Sold</b>
ST. PETERSBURG (SPT) — St. Petersburg Property Fund auctioned off an elite apartment on Krestovsky island after the owner failed to pay mortgage fees to Sberbank, Interfax reported Friday.
The starting price for the 174-square meter apartment in the Fifth Element residential complex was $1.08 million. The apartment was sold for $1.15 million.

<b>Container Firms Agree</b>
ST. PETERSBURG (SPT) — National Container Company and Eurogate, one of the largest container operators in Europe, signed an agreement on strategic partnership, Interfax reported Friday.
According to the agreement, Eurogate acquires a 20 percent stake in the Baltic Container Terminal in Ust-Luga port, in the Leningrad Oblast. National Container Company gets an option to acquire an 18.2 percent stake in JadeWeserPort in Wilgelmshafen before September 30, 2009.

<b>Systema-Gals Inks Deal</b>
ST. PETERSBURG (SPT) — Systema-Gals signed an agreement with Hebei Construction Group, one of the largest Chinese development companies, the company said last week in a statement.
According to the agreement, Hebei Construction Group will provide construction works to Systema-Gals at fixed prices. The two companies will create a joint enterprise in Russia.

<b>Latvian Gas Shares Fall</b>
MOSCOW (Bloomberg) — AS Latvijas Gaze, Latvia’s natural-gas distributor, fell by the most since November 2006 after saying it may lose as much as 30 million lati ($62 million) next year when Gazprom starts charging more for gas supplies.
Latvijas Gaze shares fell 5 percent to 7.6 lati today, valuing the company at 303 million lati. Latvijas Gaze said Dec. 14 it signed a contract with Russia’s Gazprom for next year which may increase gas prices by as much as 50 percent.
Gaze may lose between 5 million lati and 30 million lati in 2008 should the utilities regulator prevent it from raising consumer gas prices, the Latvian company said.

<b>Coca-Cola May Step In</b>
MOSCOW (Bloomberg) — Russia asked Coca-Cola Hellenic Bottling Co. to consider taking over a pulp plant polluting Lake Baikal, the world’s deepest lake.
The Baikalsk Paper and Pulp Mill is pumping an “unacceptable” amount of pollution into the lake, Oleg Mitvol, deputy head of the Natural Resource Ministry’s environmental watchdog, said in an e-mailed statement.
Mitvol discussed the proposal in Moscow on Monday with Coca-Cola HBC’s Russian director Keith Sanders, according to the statement. 

<b>Gazprom Neft Explores</b>
MOSCOW (Bloomberg) — Gazprom Neft, the oil arm of natural-gas producer Gazprom, set up a company to manage new fields in eastern Siberia.
Gazpromneft Angara was registered in Krasnoyarsk, Siberia, the company said in an e-mailed statement Monday.
The new unit, created from the assets of Kholmogorneftegaz, holds the licenses for a number of fields in eastern Siberia, which the Russian government plans to develop for a new pipeline to the Pacific coast.
All of Gazpromneft Angara’s fields are at the exploration stage and drilling won’t begin until next year, the company said.

<b>UralSib Takes Out Loan</b>
MOSCOW (Bloomberg) — UralSib Bank, Russia’s second-biggest privately owned bank by assets, said it borrowed $137 million from a group of 12 banks to fund its clients’ trading contracts. 
The one-year loan, organized by Dresdner Kleinwort and ING Groep NV, is the fourth syndicated loan raised by Moscow-based UralSib in 2007, the lender said in an e-mailed statement.
The loan will pay interest of 1 percentage point more than the London interbank offered rate, or Libor.

<b>Investment for Ukraine</b>
MOSCOW (Bloomberg) — Marbleton Property, Griffin Investment Partners and Alfa bank’s Ukrainian unit set up a joint venture to invest 100 million euros ($146.5 million) in Ukrainian real estate, Kommersant newspaper reported.
The venture, Metropolitan Properties, will buy property in all Ukrainian cities with a population of more than 100,000, Kommersant reported, citing venture officials.
Metropolitan Properties will start to acquire property in the first quarter of next year and then lease it to banks and companies that have branches in the region, Kommersant said.

<b>E.ON in Negotiations</b>
MOSCOW (Bloomberg) — E.ON AG, Germany’s largest utility, said it has made “major progress” in negotiations with Gazprom over a stake in Yuzhno-Russkoye, a western Siberian natural-gas field.
The two companies have determined what assets E.ON will swap for the stake and are determining the value of the assets, Dusseldorf-based E.ON said Monday in an e-mailed statement.
The assets to be swapped include power plants in “various western and eastern European countries” and underground storage facilities, E.ON said.

<b>Technology Sales Soar</b>
MOSCOW (Bloomberg) — Russian technology companies will probably have a record 1.8 trillion rubles ($73 billion) in sales next year as the national economy expands, Communications Minister Leonid Reiman said.
Sales of information technology and communication products and services by Russian companies will probably rise 20 percent from 1.5 trillion rubles this year, Reiman told reporters in Moscow on Monday. Russian companies invested 206 billion rubles in communications this year, 21 percent more than a year earlier.
Information technology sales in the country rose 25 percent to 450 billion rubles this year. Next year, there will almost 40 million personal computers in Russia, up from the 31 million expected this year, Reiman said. The number of Internet users will rise to 46 million, up from 35 million this year.

<b>Inflation Hits 11.5%</b>
MOSCOW (Bloomberg) — Russian inflation probably accelerated to an annual 11.5 percent in November, the central bank said.
The rate quickened from 10.8 percent in October, the Moscow-based bank said on its web site Monday.
Russia, the world’s biggest energy exporter, has struggled to lower inflation levels as revenue from oil and gas sales enters the country and global food costs rise. The government failed to meet its goal of lowering inflation to the 8 percent level this year.
“The rising pace of inflation is sounding alarm bells,’’ Economy Minister Elvira Nabiullina said in a speech published on Dec. 13. Consumer prices will probably increase an annual 12 percent this year, compared with last year’s 9 percent rate, the Economy Ministry said.

<b>Swedes Against Pipeline</b>
MOSCOW (Bloomberg) — A majority of Swedish members of parliament oppose a plan by Russia and Germany to build a gas pipeline across the Baltic Sea and through Swedish waters, demanding the government rejects the plan, a survey showed.
Some 72 percent of politicians surveyed oppose the pipeline because of environmental and national security concerns, Swedish radio SR said on its web site Monday. Only 11 percent support the pipeline, while 17 percent had no opinion. More than 60 percent of the 349 members of parliament took part in the poll, SR said. The pipeline, built by Russian-German joint venture Nord Stream AG, will stretch 1,200 kilometer (745 miles) from Vyborg in Russia to Greifswald in Germany and is scheduled to begin carrying natural gas in 2010. Critics, including the Swedish opposition parties, argue that the installation threatens the environment and want the link to be built overland instead.

<b>Pernod Pursues Vodka</b>
NEW YORK (Bloomberg) — Pernod Ricard SA is close to buying the Stolichnaya vodka brand from Russia’s SPI Group for 1 billion pounds ($2 billion), the Financial Mail reported, without citing anyone.
Pernod, which already distributes Stolichnaya outside Russia, hopes to complete the purchase by May, the newspaper said. The company is being advised by JPMorgan Chase & Co, the Financial Mail reported.

TITLE: Red Tape Criticized
PUBLISHER: The St. Petersburg Times
TEXT: MOSCOW — German Economics Minister Michael Glos on Friday urged the Russian government to step up its battle against bureaucracy and to improve the legal environment for investors. 
“We must reduce bureaucracy, we know that from our own experience,” Glos told a conference in Moscow, adding that red tape was “a Hydra growing more heads as you chop them off.” He also said that while Russia had modern laws, their application in the regions needed improvement.
Glos also criticized the spat between Lufthansa and the government about overflight rights. “It is sad when such things are allowed to tarnish the public image,” he said. 
The German carrier’s cargo division was hit by a ban from Russian airspace last month, which was only lifted after it agreed to negotiate to move its hub from Kazakhstan to Siberia, triggering complaints from the German government.
Glos spoke at the opening of the German-Russian Chamber of Commerce Abroad, which he called an engine in bilateral economic relations. 
Bilateral trade has been booming recently, reaching almost $43 billion in 2006 and making Germany the country’s biggest trade partner. 
This year’s trade figure is expected to reach $50 billion.
Glos also expressed hope that Russia would soon become a member of the World Trade Organization. 
While Economic Development and Trade Minister Elvira Nabiullina and Chamber of Commerce and Industry head Yevgeny Primakov only sent deputies to the conference, Nabiullina’s predecessor, German Gref — now head of Sberbank — made an appearance.
Gref praised the German-Russian chamber’s founding as a “logical step for Germany and a pragmatic one for Russia.”

TITLE: E-Tickets in Trial Run
PUBLISHER: The St. Petersburg Times
TEXT: MOSCOW — Russian Railways showed off a trial e-ticketing system Friday that will cut out some of the hassle of traveling on the country’s notoriously cumbersome rail network.
The system allows customers who buy their tickets online to bypass the lines at railway stations and go straight to the train with just their passport and a printout confirming their purchase.
Conductors on the platform will scan the printout with handheld computer devices. The passport details of the passenger will then flash up on the device, allowing the conductor to check their documents and let them on the train. 
So far, the experiment is only being tried on one carriage on the Yunost train service between Moscow and St. Petersburg. The trial runs until Jan. 31.
The new system is part of a broader push by the state-run railway giant to popularize e-tickets, after the company started offering customers the chance to buy tickets online in May.
In the first month of use, over 8,200 tickets were bought over the Internet, the company said.

TITLE: Hyundai To Build Local Plant by 2010
AUTHOR: By Kyunghee Park
PUBLISHER: Bloomberg
TEXT: MOSCOW — Hyundai Motor Co., South Korea’s largest automaker, will invest $400 million to build its first factory in Russia to meet surging demand in the country.
The carmaker will produce 100,000 vehicles annually at the plant in St. Petersburg, the Seoul-based company said in an e-mailed statement Monday. Construction will start in the first half of next year and completion is slated for 2010, it said.
Hyundai Motor joins Toyota Motor Corp. and General Motors Corp. in setting up factories in Russia, where a nine-year economic boom has increased car sales. The country provides an opportunity for growth for automakers as customers spent a record $16 billion on new foreign cars in the first half, fueled by rising incomes, according to PricewaterhouseCoopers LLP.
“The economic growth in Russia is encouraging people to spend more on cars, and that means setting up a plant will provide further opportunities for Hyundai Motor to increase sales,” said Song Sang Hoon, an analyst at Hungkuk Securities Co. in Seoul with a “buy” recommendation on Hyundai Motor’s shares.
The South Korean carmaker didn’t disclose which models it will produce at the Russian plant, which was first announced Nov. 12. Russia is the sixth overseas country in which Hyundai Motor will have a factory.
In the first 11 months, Hyundai Motor sold 130,166 of its Accent, Getz and other models in Russia, more than the 100,685 it sold during all of 2006. Sales in November reached 17,992 vehicles, its biggest monthly total in the country.
A total of 1.47 million foreign cars were sold in the first 11 months of this year in Russia, 63 percent more than a year earlier, according to the Moscow-based Association of European Business in the Russian Federation.
Toyota plans to open a plant in December to make Camry sedans in St. Petersburg. Volkswagen last month started production at its plant in Kaluga, 160 kilometers southwest of Moscow.
Hyundai Motor operates overseas factories in China, India, Turkey and the U.S. and is building one in the Czech Republic to meet local demand and counter the impact of currency fluctuations.

TITLE: Gas Exports May Be Delayed
AUTHOR: By Lucian Kim and Greg Walters
PUBLISHER: Bloomberg
TEXT: MOSCOW — Russia, the world’s largest energy producer, may miss a target to start exporting liquefied natural gas by the end of next year, causing possible delays to customers in Asia and the U.S.
Gazprom’s Sakhalin-2 LNG plant in the Pacific Ocean will start exports once construction is completed next year, Ivan Chernyakhovsky, a spokesman for project operator Sakhalin Energy, said in a telephone interview in Moscow on Monday.
“We plan to complete the main construction and commence start-up of the plant before the end of 2008,” Chernyakhovsky said. “Export is expected to start shortly thereafter.”
Sakhalin Energy previously said exports of LNG, gas chilled to a liquid for transport by tanker, would start in the third quarter of 2008. The company has signed contracts with clients including Tokyo Gas Co. and Tokyo Electric Power Co.
Chernyakhovsky declined to say whether Sakhalin Energy planned to buy cargoes of LNG to ship to its customers, or if the company could face penalties for missing delivery deadlines. Japan and South Korea are two of the world’s biggest buyers of LNG as pipelines don’t reach their territory.
“Our customers are constantly being kept informed on the project’s progress,” Chernyakhovsky said.
Sakhalin Energy Chief Executive Officer Ian Craig said in September 2006 that a one-year delay would cost the company shareholders $10 billion. The government was then threatening to pull a key permit over alleged environmental violations.

TITLE: Severstal Borrows to Go Green
PUBLISHER: Bloomberg
TEXT: MOSCOW — Severstal, the steelmaker owned by Russian billionaire Alexei Mordashov, borrowed 300 million euros ($432 million) from the European Bank of Reconstruction and Development to fund a program to cut greenhouse gas emissions.
The loan is the largest for a Russian company to reduce emissions, Severstal and the EBRD said in a joint statement today. The two-part deal for the Cherepovets-based steelmaker matures in seven years and 10 years, the e-mailed statement said.
Russia, the world’s third-largest polluter, expects its greenhouse-gas emissions to increase by about 15 percent through 2015, according to the Economy Ministry, as the economy expands for the ninth straight year.
Severstal, the country’s biggest steelmaker, plans to spend 700 million euros to reduce energy consumption by 5 percent to 10 percent, the statement said.

TITLE: Kudrin Meets Storchak at Lefortovo, Storchak Could Face 10 Years in Jail
PUBLISHER: Combined Reports
TEXT: MOSCOW — Finance Minister Alexei Kudrin has met with his deputy Sergei Storchak, charged with attempting to embezzle $43 million, for the first time since Storchak’s arrest, his ministry said Friday. 
Kudrin met with Storchak for two hours at the Lefortovo pretrial detention facility and “discussed issues related to the competence of the Finance Ministry,” Itar-Tass reported.
The Storchak case has been politically damaging for Kudrin, the deputy prime minister in overall charge of the economy, as Kremlin factions vie for influence ahead of an election in March for the successor to President Vladimir Putin. 
Storchak, the country’s foreign debt negotiator who also oversaw the $144 billion stabilization fund, has been charged in relation to a failed attempt to recover a debt owed by Algeria. He faces up to 10 years in jail if convicted. 
Reuters, SPT

TITLE: Nord Stream Will Revise Pipeline Costs
PUBLISHER: Reuters
TEXT: MOSCOW — Nord Stream, the firm building a subsea gas pipeline from Russia to Western Europe, said Thursday that early next year it would revise upward the project’s costs, which analysts say may soar by at least 60 percent.
Nord Stream, majority owned by Gazprom, has said it would take at least 5 billion euros ($7.3 billion) to build the 1,200-kilometer pipeline under the Baltic Sea from Russia to Germany.
“We are most likely to increase the estimated costs of the project in early 2008, after we complete evaluation of four main expense categories, such as pipes, pipe-laying, logistics and environment,” spokeswoman Irina Vasilyeva said.
She said the main reason for the review was a steep increase in steel prices since costs were first estimated in 2005.
A Nord Stream spokeswoman in Switzerland, where the group is based, confirmed that it would only be possible to make a new cost estimate in February or March.
Nord Stream could not say how much costs might rise, but media Wednesday quoted Germany’s former chancellor Gerhard Schröder, as saying in New York that they might balloon to 8 billion euros ($11.8 billion).
Schröder chairs the supervisory board of the Nord Stream consortium, which apart form Gazprom, which owns 51 percent, involves German firms BASF and E.On, with 20 percent each, and Dutch Gasunie with 9 percent. E.On Ruhrgas CEO Burckhard Bergmann told reporters Wednesday that the Nord Stream costs were likely to turn out to be more expensive than many energy projects across Europe, but declined to specify a new figure.
A spokesman for BASF said the company had already said in presentation over a year ago that the figure might rise to 9 billion euros ($13.2 billion).
Analysts said an increase to at least $12 billion was very likely, as Nord Stream faces rising global prices for materials and services and other environmental challenges.

TITLE: A Bad Blend of Brezhnev and Abramovich
AUTHOR: By Vladimir Ryzhkov
TEXT: A new political model has emerged after the State Duma elections — Putin’s model. Putin began constructing this model in 1999, but it only reached its most advanced stage this fall.
Putin’s regime is the Russian version of the typical authoritarian model. One could describe its foundation in terms of a bureaucratic monopoly. Russia shares the following fundamental characteristics with countries such as China, Pakistan, Egypt, Belarus, Iran and Venezuela: heavy policy control, censorship in the main media channels and the systemic hounding and persecution of nongovernmental organizations, human rights groups and opposition parties. The absence of the rule of law is also a standard for all autocracies. Another characteristic that Moscow shares with other authoritarian governments is the enormous role that the security services, including the Federal Security Service and Prosecutor General’s Office, play in society. But in contrast to other autocratic governments, the main source of Russia’s authority is the so-called vertical power structure, composed of 1.6 million federal bureaucrats — a figure that has grown 1.5 times since Putin has come to power. In China and Cuba, for example, the source of power is a monopoly political party; in Chile during Pinochet’s reign, it was the army; in Iran, it is the religious leaders; and in Saudi Arabia, it is the ruling dynasty.
In contrast, there was some division of power under President Boris Yeltsin. The main centers of power in the 1990s were:
• the president and his administration
• the ministers in the Cabinet, who had a fair 
amount of autonomy, particularly under Prime Ministers Viktor Chernomyrdin and Yevgeny Primakov
• governors who were popularly elected
• large business
• mass media
• political parties in the Duma
During the Yeltsin era, political consensus depended on striking compromises among the Duma, Federation Council, Cabinet and even within the Kremlin.
Not a trace of these elements of pluralism has remained under Putin’s presidency. For the last seven years, all of the above-mentioned centers of influence have been stripped of their independent authority. Having just become president in 2000, Putin began constructing his vertical power model by taking control of the three largest nationwide television stations. Then, he weakened governors as an independent power base by reforming the Federation Council and by canceling direct gubernatorial elections. Then the Kremlin moved on to destroying the political power of business by targeting Boris Berezovsky, Vladimir Gusinsky and Mikhail Khodorkovsky. Putin severely weakened the autonomy of the Cabinet by appointing weak and compliant technocrats such as Mikhail Fradkov as prime ministers. Finally, Putin used all available administrative resources to make sure that liberal opposition deputies would not get seats in the Duma. He also weakened the Communists, who had been a strong opposition force in the 1990s, and filled the parliament with enough servile United Russia deputies to gain a constitutional majority.
All power is now concentrated in the hands of bureaucrats. Putin’s loyal cronies — above all, his buddies and former colleagues from the KGB and the St. Petersburg Mayor’s Office — sit at the very top of this bureaucratic power base. Then there are the governors, whose fate now completely rests on the presidential administration. The mayors of leading cities are one step lower on the bureaucratic hierarchy; they have been herded into United Russia on “voluntary-mandatory” conditions. In addition, there are bureaucrats who work in various government jobs who understand all too well that the only way to keep their jobs is to constantly prove their loyalty to the Kremlin. The reward for this loyalty is to reap the benefits of a massive system of corruption, where bureaucrats are allowed to abuse their positions to advance the interests of their personal businesses. Corruption has become an acceptable norm and principal motivation for Putin’s army of bureaucrats. It runs rampant at all levels of government — from executives at government television stations to judges, from FSB generals to police officers. One could say the government has been strengthened and reborn, but it has assumed a grotesque and malignant form where corruption and lawlessness have become more important than civil duty among bureaucrats.
The crown jewels of the country’s national wealth have ended up in the hands of Putin’s inner circle. These close friends of the president now control the most profitable sectors of the economy in oil and gas export and weapons trade, and they include deputy chief of staff Igor Sechin, First Deputy Prime Ministers Dmitry Medvedev and Sergei Ivanov, Gazprom CEO Alexei Miller, Russian Technologies head Viktor Chemezov, Finance Minister Alexei Kudrin, Russian Railways head Vladimir Yakunin, IT and Communications Minister Leonid Reiman and Gennady Timchenko, co-founder of the influential oil-trading company Gunvor.
Putin has accomplished what would seem to be the impossible. In forming his vertical-power model, he has taken some of the worst elements of Soviet rule and combined them with some of the worst Yeltsin attributes. In such a way, Putin has created a Soviet-oligarchic model: a synthesis of Soviet monopoly on political power combined with the nepotism and corruption from the 1990s. This grotesque amalgamation of Brezhnev with Abramovich constitutes the foundation of Putin’s power structure. The Russian elite energetically rallied around this simple idea of seizing and dividing up enormous natural resource wealth among themselves — and, what’s worse, this was accomplished under the bombastic cries of the “rebirth of Russia’s greatness.”
But you have to give Putin credit. He has been able to gain the support of the majority of Russians even though they generally lose as a result of this political model. For example, Russia is developing a lot slower than it should. The gaps between the rich and poor and the largest cities and the regions are growing. The country is also falling behind the West in the technological sphere, and it is losing its ability to compete on global markets.
Despite all of this, however, Putin’s popularity remains extremely high. There are other factors working to Putin’s favor besides outright vote-rigging and forcing people to vote for pro-Putin parties. To be sure, some small pieces of the huge oil wealth have ended up in the people’s hands, and this has led to a consumer-spending boom. Moreover, the Kremlin mobilized the people against fictitious “external enemies” such as the United States, NATO, Georgia, Estonia and Poland, as well as “internal enemies” such as liberals, terrorists, extremists and oligarchs. Taken together, this has all increased Putin’s popularity.
But I am afraid that the time of “stability” is coming to an end. Despite the powerful Kremlin public relations machine and its use of enormous administrative resources, signs of an economic and political crisis are looming. Not only are the people growing more dissatisfied, but there is increasing dissent among the elite as well. The presidential “election” in March will be the next difficult durability test for Putin’s political model — one that is based on a very shaky foundation of bureaucratic monopoly.

Vladimir Ryzhkov was a State Duma deputy from 1993 to 2007.

TITLE: Living With Cheap Oil
AUTHOR: By Alexei Bayer
TEXT: The deflation of the real estate bubble began with a weak link — the subprime segment of the U.S. mortgage market among poor homeowners who were unable to service their loans. It is now spreading into other market segments in the United States and abroad, for example, into the overbought residential property market in Britain.
But the real estate bubble is only one of several bubbles that have appeared in the world economy since the start of this decade. Others include the stock market bubble, which has so inflated wealth that all 400 richest Americans on the Forbes list are now billionaires. This year, the “poorest” member of this club was worth $1.3 billion — one-third more than in 2006.
The stock-price bubble has been even worse in emerging markets. A rally on the Mexico City bourse has turned Carlos Slim, the owner of Telmex, the telecoms monopoly, into the world’s richest man.
Economists have been at pains to explain the price run-up in each of these markets. Real estate prices have been rising because the baby-boom generation is maturing and a new class of homeowners has been created thanks to cheap mortgages. Fine art prices have been bid up because new museums are being built all over China and the Middle East. Stock prices have also risen because profits growth has been so strong.
But when so many asset classes are hitting the stratosphere all at once, another factor is likely to be at work, namely the loss of value of money. Instead of a series of unrelated bubbles, the world economy is experiencing one general bubble — the surfeit of liquidity.
Commodity markets have also been in a bubble stage, their prices rocketing due to cheap and plentiful liquidity. Oil being a bellwether of other commodities, the oil market has been the one where the bubble is easiest to identify.
Undoubtedly, since the end of the 2001-02 economic slump there has been a strong rise in global demand for oil. Most nations, industrial and emerging ones alike, use more oil. The main culprit is China, where demand for oil jumped from 4.8 million barrels per day in 2000 to 7.3 million barrels per day in 2006.
But oil output also rose strongly over the same time period, with Russia alone now producing 3 million barrels per day more. Even if oil supplies have tightened since the end of the 1990s, when its price bottomed out at around $10 per barrel, it certainly doesn’t justify a tenfold jump in oil prices.
Today, the bulk of the world’s oil is sold through the futures markets, where players are not users or producers of oil but speculators. They should be looking not so much at today’s supply-demand relationship but at future trends in the market. The longer term outlook for oil prices appears to be grim. Oil reserves have been boosted by recent offshore finds as well as the inclusion of Canada’s tar sands into its proven reserves. Oil recovery rates from new and existing reservoirs have increased due to new technologies. Moreover, at $100 per barrel, new sources of supply constantly emerge, and development of new technologies for energy conservation and alternative energy sources becomes more attractive. Currently, tens of billions of dollars are being invested into new oil exploration and production.
The real estate crisis is only the beginning. Once the U.S. Federal Reserve and other central banks tightened their monetary policies, the pricking of the liquidity bubble was set in motion. Stock prices have been volatile, and volatility has spread into the oil market since the start of November. Late last month, oil dropped by 15 percent in a few trading sessions. Even though it has bounced back, oil producers — and certainly Russia — should get ready to live with substantially lower oil prices.

Alexei Bayer, a native Muscovite, is a New York-based economist.

TITLE: The Perils of Putinism Found in Its Instability
AUTHOR: The Wall Street Journal
TEXT: Plans for a transition of power were unveiled last week in Russia. The news is that there won’t be one. 
This choreographed switcheroo is Putinism to a tee. The president and his men trample on civic freedoms and concentrate power in the name of “order” and “stability.” With the economy growing on the back of oil approaching $100 per barrel, up from $15 per barrel when Putin took office in 2000, complaints are muted — sometimes by force. But of all peoples, Russians ought to have learned from history that personalizing and centralizing so much authority brings trouble down the road. 
An old friend of Putin’s from his KGB days told us last week that the president wanted to step down to establish a precedent for future leaders. But in the same breath, he said it was too dangerous for  Putin to step aside — for Russia, and for Putin himself. This is largely true, and is another feature of Putinism. 
This transition could have helped democracy to mature. The country lost an opportunity in this decade of good economic times to build a proper and predictable political system around institutions rather than men. The blame falls squarely on Putin. 
A turning point was Ukraine’s Orange Revolution in 2004. There, an Orthodox Slavic nation rose against a corrupt and authoritarian clique in spite of a booming economy; this came too close to home for the Kremlin. In its wake, Putin has turned Russia’s government into the most anti-Western outside of Iran, Cuba, North Korea and Venezuela. 
The absence of democracy is dangerous for Russia and the world. Putinism hangs on a single man. It denies  the people a proper outlet to discuss their problems. Others will be found. Fast-rising inflation has brought impromptu demonstrations. 
The Kremlin has opened a Pandora’s box by embracing neo-fascist youth groups and ideas that will be hard to control. After the thaw under Soviet leader Mikhail Gorbachev and President Boris Yeltsin, the people are once again nothing compared with the power of the state, and they may one day rediscover a taste for liberty. All of this makes the country unpredictable. In the meantime, power struggles will continue among various factions inside the Kremlin, beyond view and unchecked by laws. Contrary to its own advertising, Putinism has sown the seeds of instability. 
The tapping of First Deputy Prime Minister Dmitry Medvedev and the prominent role carved for Putin in no way ends the great uncertainty about Russia’s near- and long-term future. It merely accentuates it. 

This comment appeared as an editorial in The Wall Street Journal.

TITLE: Stemming Climate Change
AUTHOR: By Brook Horowitz
TEXT: At the United Nations Conference on Climate Change that has just concluded in Bali, the world’s governments agreed to begin two years of negotiations to replace for the Kyoto Protocol on greenhouse gas emissions. But the tensions between the United States and China over who takes on obligations for emissions will make a solution hard to come by between now and 2009. In the absence of global leadership by the two largest producers of greenhouse gases, could there be a role for Russia, the third-largest producer?
Environmental issues have not traditionally been high on the agenda in Russia. Moscow ratified the Kyoto Protocol, but there is little incentive for Russia to reduce emissions, which were based on the country’s 1990 industrial production levels — very high compared with the ensuing years of post-Soviet decline. Some cities have been rated amongst the world’s most polluted. Furthermore, with low domestic energy prices, consumers lack motivation to save energy.
But change is afoot. Russian companies, faced by the challenge of rapidly increasing demand, are investing in more efficient, environmentally friendly technologies. For example, TNK-BP is planning to invest more than $1.5 billion over the next five years to develop associated gas production. RusAl, the world’s largest aluminum producer, is investing in energy-saving technologies in its new plant in Taishet near Irkutsk.
International banks funding large projects in Russia are influencing corporate behavior by being ready to refuse finance to companies that present an environmental risk. The European Bank for Reconstruction and Development, with its strategy to promote sustainable energy, focuses project finance on developing renewable sources such as last year’s investment into Gidro OGK’s reconstruction of hydroelectric plants.
Attitudes are changing too. A recent survey of Russian companies by the World Wildlife Fund showed considerable commitment to the introduction of environmental management systems and standards such as ISO 14001. Consultations with local communities and nongovernmental organizations on environmental concerns by companies such as Unified Energy System are becoming more commonplace. Environmental lobbying can sometimes work, as was shown in 2006 by the rerouting of Transneft’s pipeline away from Lake Baikal. Recently President Vladimir Putin even reminded the head of the Sochi Olympic corporation to make sure that environmental issues were properly dealt with during the 2014 Games.
For Russia, climate change presents a host of untapped opportunities. The country has scientists capable of participating in the development of clean technologies. For example, there is groundbreaking work in producing nuclear energy more safely than with traditional methods, and Russian scientists are working on hydrogen technology and nanotechnology, both important in renewable energy. This research could be in fierce demand in both the developed and developing worlds, challenged by how to make clean energy cost-effective and how to reduce emissions without adversely slowing economic growth.
Companies are in fact ready to take action on environmental issues even if the law and public opinion do not necessarily force them to. As elsewhere, they can exert far more influence by taking a position rather than by waiting for an environmental disaster to happen or for governments to decide for them.
If business and governments, both in Russia and abroad, could encourage these new trends and make the most of the competitive advantages of industry and science, there could be real benefits for Russia and the world. Inside the country, such an approach would resurrect research and development that has been underfunded over the past 15 years, and encourage diversification of the economy into high-tech industries.
Over the next two years of negotiations following the Bali conference, Russia, as the only member of the Group of Eight that is also a rapidly industrializing nation, could make a positive impact by leading the commitment to radically cut emissions post-2012. A Russia actively contributing to solving climate change would help diffuse many of the current tensions in the international energy dialogue and accelerate the long-term diversification of global energy sources and the introduction of energy-saving technologies — two critical components of global energy security.
Russia would thereby position itself as a country not only safeguarding its national interests, but it could also make a significant contribution to the sustainable development of the world for decades to come.

Brook Horowitz is executive director of the International Business Leaders Forum in Russia.

TITLE: British Forces Hand Basra Back to Iraqis
PUBLISHER: Reuters
TEXT: BASRA, Iraq — British troops handed over security to Iraqi forces on Sunday in the last of four provinces it once patrolled, effectively marking the end of nearly five years of control of southern Iraq.
Thousands of Iraqi police and troops marked the handover with a parade along the palm-fringed embankment in Basra, the country’s second-biggest city, in a show of Iraqi military force on a scale unseen since the days of Saddam Hussein.
They drove past in heavy tanks, armoured vehicles, pick-up trucks with mounted machine guns and police patrol cars with flashing lights. Iraqi helicopters buzzed overhead and gunboats sailed up the Shatt al-Arab waterway, which leads to the Gulf.
“Today we stand at a historic juncture and a special day, one of the greatest days in the modern history of Basra,” provincial governor Mohammed Mosbah al-Waeli said at a ceremony held in the departure lounge at Basra airport, where a scaled-down British force now has its last remaining base.
Control of Basra province will be the biggest test yet of the Iraqi government’s ability to keep the peace without relying on troops from either the United States or its main ally.
The province, site of Iraq’s second-largest city, its only major port and nearly all its oil exports, is far wealthier and more populous than any of the other eight of Iraq’s 18 provinces previously placed under formal Iraqi control.
The British commander, Major-General Graham Binns, said Iraqi security forces had “proved that they are capable”.
“I came to rid Basra of its enemies but I now formally hand Basra back to its friends,” said Binns, who also led the force that captured the city from Saddam’s troops in 2003.
Washington has publicly backed its ally’s withdrawal, even while 30,000 extra U.S. troops were sent to Iraq this year.
Secretary of State Condoleezza Rice said the British were doing what Washington hoped could be possible throughout Iraq.
But, during a visit to Paris, she added: “We obviously recognize, and the British recognize, that there is still a lot of work to do in terms of building a stable foundation in the south and there continue to be problems there.”

RESIDENTS OPTIMISTIC
Basra is a lively place, with restaurants open late and little of the barricaded siege mentality of the capital, Baghdad. The mainly Shi’ite south escaped the sectarian warfare that killed tens of thousands in central and northern Iraq.
But Basra has seen plenty of bloodshed in the form of turf wars between rival Shi’ite factions, criminals and smugglers. Police accuse militants of imposing strict Islamic codes and killing women for so-called “honor crimes”.
A triple car bomb attack that killed about 40 people in neighbouring Maysan province last week was a reminder of the potential for violence in areas vacated by the British.
The Iraqi government says Basra’s main factions agreed to a truce this month, killings in the city are down and 30,000 troops and police in the area can keep the peace.
Britain now has 4,500 troops in Iraq, less than a 10th of the force that Tony Blair dispatched to help topple Saddam in 2003. Blair’s successor as prime minister, Gordon Brown, has said the force will shrink to 2,500 by mid-2008, including a small training mission and a rapid response team on standby.
The British were welcomed into Basra in 2003, but residents soured to them over the years. A BBC poll showed the overwhelming majority of people are glad to see the British go.
“You can see this happiness on the faces of everyone. It feels like a heavy burden has been lifted off our chests,” said teacher Adel Jassem.
Still, some worry that Iraqi forces may not be up to the job: “The handover is a good step, but we hope that Iraqi forces are ready. I don’t think they are fully ready and the handover should have been delayed,” said merchant Faisal Sharhan, 28.
Others, too, have criticized the manner of the British withdrawal. The influential U.S.-based defence expert Anthony Cordesman has called it a “defeat”.
Al Qaeda’s second-in-command, Ayman al-Zawahri, said the handover showed that insurgents were gaining the upper hand.
“Reports from Iraq point to the increasing power of the mujahideen and the deteriorating condition of the Americans,” Zawahri said in a video posted on the Internet. “And the decision of the British to flee is sufficient .”

TITLE: Tiger Woods Wins Target World Challenge Trophy
AUTHOR: By Doug Ferguson
PUBLISHER: The Associated Press
TEXT: THOUSAND OAKS, California — First came a kiss for his daughter. Then came a pose with the trophy. 
For Tiger Woods, life has never been better. 
“This year on the golf course, it’s been a great year,” he said Sunday after closing out the season with a seven-shot victory in the Target World Challenge. “Off the golf course, it’s been the greatest year I’ve ever had.” 
He could not have picked a better way to end 2007. 
Woods hosted an elite, 16-man field at Sherwood Country Club to play 72 holes in gorgeous weather for $5.75 million in prize money, with last place getting $170,000 without even having to show up on Sunday. 
But the relaxed setting gave way to a frightening future. 
Woods had been out of competition for 10 weeks, dating to his singles loss to Mike Weir in the Presidents Cup on Sept. 30. He began hitting balls about 10 days ago to get ready for the Target World Challenge, then played as if he never left the couch. 
He set the course record with a 62 in the second round. He tied the tournament record at 22-under 266, first set by Davis Love III in 2000 the first year the tournament came to Sherwood. And his 68 in the final round Sunday gave him a seven-shot victory, the largest in tournament history and his third win this year by at least that many. 
So much for rust. 
“Doesn’t help us, does it?” Colin Montgomerie said. “If he took a bloody year off, it would help.” 
Paul Casey was coming off a four-week break and expected to hit a few loose shots. He did not think he would wind up 21 shots behind a guy who took off 2 1/2 months. 
“We have a saying in England that he was Rolls-Roycing it,” he said. “You fire up the car and it purrs perfectly.” 
The scary part is that Woods said he was struggling with his swing over the past two days. Jim Furyk noticed a few loose shots and forged ahead Sunday, closing a six-shot gap to two shots when they made the turn in the final group. 
Furyk hit a wedge with no spin that stopped 4 feet behind the hole, leaving him a downhill putt. Woods’ wedge spun back to 12 feet below the hole. And that’s where the tournament effectively ended. 
Woods calmly made his putt for birdie, and Furyk three-putted for bogey to fall four shots behind. 
“You don’t start six down to Tiger very often and cut it to two, so I had a really good opportunity,” Furyk said. “And I wasn’t able to take advantage of it.” 
The consolation prize went to Masters champion Zach Johnson, whose birdie on the final hole secured a 68 and second place, which was worth $840,000. Furyk bogeyed the last hole for a 71 to finish third and earn $570,000. 
Another consolation prize might be the fact that Woods is taking another vacation, not returning to start his 2008 campaign until he defends his title at the Buick Invitational at Torrey Pines. 
But the world’s No. 1 player still feels like he can improve. 
“I’m going to shut it down a little bit, go back home and think about it and talk to Henry about some of the swings I’ve made this week,” he said, referring to swing coach Hank Haney. “Obviously, I’ve got a lot of room for improvement, which is a great sign.” 
Improvement? 
He won seven times on the PGA Tour this year, including the PGA Championship for his 13th career major. He swept all the major awards, won the inaugural FedEx Cup, and came out of hibernation to win his Target World Challenge for the fourth time, the first player to win in consecutive years. 
As usual, he donated the $1.35 million to his Tiger Woods Learning Center. 
“I hit a lot of good shots this week, but I also hit some loose ones,” Woods said. “The great thing is my bad ones aren’t as bad as they used to be. Either I just miss fairways or just miss greens, but obviously not off the planet like they used to be. 
“Just imagine if I could hit the ball the way I wanted.” 
Even more fulfilling was having 6-month-old Sam Alexis making her first greenside appearance, held by her grandmother, Kultida Woods. 
Woods is a new father, but he was amazed at the British Open when he watched Padraig Harrington make double bogey on the 18th hole at Carnoustie, then melt into smiles when 3-year-old Patrick rushed into his arms. 
“That’s how powerful family is,” Woods said.

TITLE: EU Promises $650M for Palestinians
AUTHOR: By Karin Laub
PUBLISHER: The Associated Press
TEXT: PARIS — Donors began committing funds from around the world Monday for the moribund Palestinian economy amid a renewed international push for a Palestinian state, with the European Union promising $650 million in 2008.
Palestinian Prime Minister Salam Fayyad is asking for $5.6 billion over three years. UN Secretary General Ban Ki-moon urged the international community to fulfill the Palestinian needs and more.
“What we must do now is work together before the end of 2008 for the creation of an independent, democratic, viable Palestinian state,” French President Nicolas Sarkozy, the meeting’s host, said in a speech to representatives from nearly 90 donor countries and international organizations.
Meanwhile, Palestinian President Mahmoud Abbas said Monday that he has ruled out dialogue with rival Islamic militant Hamas, and that without international support Gaza is “heading into disaster.”
Gaza has been virtually cut off from the world since Hamas seized control of the territory by force in June. Israel and Egypt sharply restricted border access in response, and the blockade has further deepened poverty there.
Abbas, speaking at the conference in Paris, said Gaza is already “close to catastrophe,” and would head into disaster without continued international aid.
The European Union launched the day of pledges of aid by promising $650 million in 2008, EU External Relations Commissioner Benita Ferrero-Waldner told The Associated Press.
In 2007, the European Union initially pledged $245 million, but ended up contributing $798 million for that year because of deepening poverty in the Palestinian territories.
In all, the EU and its member states gave about $1.45 billion to the Palestinians in 2007. The figure includes not just aid to the Palestinian government, but also contributions to international agencies that assist the Palestinians.
Ferrero-Waldner said she couldn’t say yet how much the EU would contribute in 2009 and 2010, since she didn’t know what the available EU budget would be, but suggested the aid would roughly hold steady. That would make the overall EU contribution a substantial chunk of the total pledged Monday.
Ferrero-Waldner and Fayyad urged Arab states to do more. Since 2002, Arab League members have been promising the Palestinians $55 million a month, put have not always paid in full.
The U.S. has announced it is pledging about $555 million for 2008. However, the money includes about $400 million that the White House already has announced, but that has not been approved by Congress.
Fayyad is trying to assure donor countries — which gave more than $10 billion to the Palestinians over the past decade — that they are not expected to prop up the Palestinian government indefinitely.
He has presented a three-year reform plan, with promises to cut government spending by trimming a bloated public payroll and reducing hundreds of millions of dollars in utility bills.
Still, he wants 70 percent of the aid initially to go toward reducing his huge budget deficit, with the emphasis shifting only gradually to development projects.
Economists say it’s not enough for the donors to pledge aid and for the Palestinians to carry out reforms. The Palestinian economy will only recover, according to the World Bank, if Israel eases sweeping physical and administrative restrictions on movement in the West Bank and Gaza.
Israel has been reluctant to do so, putting security first. The Israeli military considers roadblocks key to preventing attacks on Israelis by Palestinian militants.
The tensions on the ground played a role in the donors conference.
Abbas called on Israel Monday to freeze Jewish settlements “without excuses.” Under the U.S.-backed “road map” peace plan, Israel is required to freeze the construction of Israeli settlements, while the Palestinians must disarm militants and restore order in the Palestinian territories.

TITLE: Federer Named 2007 ITF World Champion for a Fourth Time
PUBLISHER: Reuters
TEXT: LONDON — World number ones Roger Federer and Justine Henin were named 2007 ITF World Champions, the governing body announced on Monday. 
Federer, who won eight titles during the season, became only the second player after Pete Sampras to receive the accolade for the fourth successive year. 
The 26-year-old reached all four major finals for the second successive year, winning the Australian Open, Wimbledon and U.S. Open. He also became the first player to earn over $10 million in annual prize money. 
“Each year brings new challenges, and I am proud that I have been able to raise the level of my game when needed. It gives me great satisfaction to have won another three grand slam titles and maintained the number one ranking,” said Federer. 
The 25-year-old Henin, who triumphed at Roland Garros and the U.S. Open, captured a career-best 10 titles in 2007. With an impressive 63-4 win-loss record, she became the first woman to earn more than $5 million in a single year. 
“This has definitely been the best season of my career so far and I am delighted to be named ITF world champion once again,” said the Belgian, who missed the Australian Open in January following the breakdown of her marriage. 
“It has been a very challenging year overall, but I have stayed positive and proved that nothing is impossible if you work hard. I still think my best tennis is yet to come.” 
American brothers Bob and Mike Bryan, and Cara Black and Liezel Huber were named doubles world champions.

TITLE: Iraq Complains As Turkey Attack Kurds
AUTHOR: By Bradley Brooks
PUBLISHER: The Associated Press
TEXT: BAGHDAD — Iraqi leaders complained Monday that Turkey had not coordinated with Baghdad before sending dozens of warplanes to bomb Kurdish rebel targets in northern Iraq — the largest aerial attack in years against the outlawed separatist group.
In Turkey, a U.S. Embassy official in Ankara said Washington was informed about the operation.
“It was a Turkish operation, it was a Turkish decision. We were informed,” the official told The Associated Press on condition of anonymity, as the official was not authorized to speak to the media.
Iraq’s Foreign Minister Hoshyar Zebari said the Iraqi government thought Turkey would coordinate with it before striking the rebels from the Kurdistan Workers’ Party, or PKK, inside Iraq on Sunday. He also indicated that the fact Iraqi civilians were killed showed Turkey had not hit the right target.
“What happened yesterday was based maybe on misinformation,” Zebari said.
An Iraqi official said the planes attacked several villages, killing one woman. The rebels said two civilians and five rebels were killed. Turkey insisted the strikes were aimed at rebel targets and not at the civilian population.
As many as 50 fighter jets were involved in the airstrikes, Turkish media reported. Turkey has recently attacked the area with ground-based artillery and helicopters and there have been some unconfirmed reports of airstrikes.
The attack came a month after the U.S. promised to share intelligence with Turkey to help combat the Kurdistan Workers’ Party, or PKK and Turkey’s military chief, Gen. Yasar Buyukanit, said U.S. intelligence was used Sunday.
“America gave intelligence,” Kanal D television quoted Buyukanit as saying. “But more importantly, America last night opened (the Iraqi) airspace to us. By opening the airspace, America gave its approval to this operation.”
In Washington, a Pentagon official said that the U.S. military has been sharing intelligence with the Turks, but that he did not know exactly what information was given to aid with the airstrikes or when it might have been given.
Another defense official said the U.S. had made sure Turkey would have clear use of the skies to enable the strikes.
They both spoke on condition of anonymity because they were not authorized to speak on the record.
Jamal Abdullah, a spokesman for the regional Kurdistan government, said the air raids were “a violation of Iraq’s sovereignty.”
He said the bombers did not distinguish between militant and civilian targets, even though Turkey’s government has said “they are not an enemy of the Kurdish government or its people.”
Masoud Barzani, leader of the autonomous Kurdish region, condemned the attacks, which he said were “conducted with indirect U.S. approval, as defending the sovereignty of Iraq and the Kurdish region is within the Americans’ responsibilities.”
Turkey’s military on Monday was assessing the damage caused to the PKK. Private NTV television said at least one rebel command center in Qandil was destroyed. The mountain is a base for the PKK’s leadership council and a network of camps, although some reports have suggested the rebels may have abandoned their bases in anticipation of attacks.
Turkey has massed tens of thousands of troops along its border with Iraq. In October, parliament voted in favor of authorizing the government to order a cross-border operation against the group.
Turkish forces have periodically shelled across the Iraqi border, and have sometimes carried out “hot pursuits” — limited raids on the Iraqi side that sometimes last only a few hours.

TITLE: Climate Deal Cut  In Bali
AUTHOR: By David Fogarty
PUBLISHER: Reuters
TEXT: NUSA DUA, Indonesia — Nearly 200 nations agreed at UN-led talks in Bali on Saturday to launch negotiations on a new pact to fight global warming after a last-minute reversal by the United States allowed a breakthrough. Washington said the agreement marked a new chapter in climate diplomacy after six years of disputes with major allies since President George W. Bush pulled out of the Kyoto Protocol, the main existing plan for combating warming.
But despite its dramatic turnaround in the meeting, which approved a “roadmap” for two years of negotiations to adopt a new treaty to succeed Kyoto beyond 2012, the White House said it still had “serious concerns” about the way forward.
“This is the defining moment for me and my mandate as secretary-general,” UN Secretary-General Ban Ki-moon said after making a return trip to Bali to implore delegates to overcome deadlock during the talks.
Ban had been on a visit to East Timor. “I am deeply grateful to many member states for their spirit of flexibility and compromise,” Ban told Reuters.
The roadmap widens Kyoto to the United States and developing nations such as China and India. Under the deal, a successor pact will be agreed at a meeting in Copenhagen in late 2009.
The deal after two weeks of talks came when the United States dramatically dropped opposition to a proposal by the main developing-nation bloc, the G77, for rich nations to do more to help the developing world fight rising greenhouse emissions.
But the White House voiced reservations about future talks. Negotiators “must give sufficient emphasis to the important and appropriate role that the larger emitting developing countries should play,” White House spokeswoman Dana Perino said.
The United States is the leading greenhouse gas emitter, ahead of China, Russia and India.
Indonesian Environment Minister Rachmat Witoelar, the host of the talks, banged down the gavel on the deal to rapturous applause from weary delegates.
“All three things I wanted have come out of these talks — launch, agenda, end date,” Yvo de Boer, head of the UN Climate Change Secretariat, told reporters.
The accord marks a step toward slowing global warming that the UN climate panel says is caused by human activities led by burning fossil fuels that produce carbon dioxide, the main greenhouse gas.
Scientists say rising temperatures could cause seas to rise sharply, glaciers to melt, storms and droughts to become more intense and mass migration of climate refugees.
The European Union, which dropped earlier objections to the draft text, was pleased with the deal.

TITLE: Iranian President Backs Down in FIFA Face-Off
PUBLISHER: Agence France Presse
TEXT: TEHRAN — President Mahmoud Ahmadinejad has withdrawn his candidate to head the national football federation, in a bid to end a row with FIFA that threatened Iran’s future in world football. 
Ahmadinejad said he had told Mohammad Ali-Abadi, an Iranian Vice President and head of the state-run Physical Education Organisation (PEO) not to stand in elections to head the Iranian Football Federation. 
The candidacy of Ali-Abadi has infuriated FIFA, whose regulations take a strong stance against any government interference in football. Iran risked again being banned from world football if they did not comply.
In the interest of football, I tell Ali-Abadi to step aside and let the elections take place and allow the election of an appropriate person,” Ahmadinejad told state television in an interview late on Sunday. 
Ahmadinejad said he had promoted the politically conservative Al-Abadi as a “strong” candidate. 
But his nomination was seen as a direct challenge to the acting head of the federation, Mohsen Safayee Farahani, a reformist who is allied to the president’s political opponents. 
“A political team tried to exploit the situation without taking into account national interests,” Ahmadinejad, who touts himself as a big football fan, said in the interview. 
The dispute over Ali-Abadi’s eligibility has for the last weeks held up the election for the presidency of the federation. 
“There are certain rules on who can and who cannot run for federation presidency,” Safayee-Farahani told the Fars news agency last week. 
“The country’s sports chief and main policy maker in sports affairs is one of those who definitely cannot,” he noted. 
The vacuum at the top has also impeded the underperforming Iranian national team’s search for a new coach. Officials have said an appointment can only be made after the federation elections. 
Names including Germany’s Winfried Schaefer and Frenchman Philippe Troussier have been mooted as possible candidates to revive the fortunes of the national side after their dismal 2006 World Cup first round exit. 
Iran have been handed a relatively straightforward draw for the 2010 World Cup in South Africa in a group including Kuwait, the United Arab Emirates, and Syria. 
The country was briefly banned from world football last year for political interference when the government sacked the then federation’s president, Mohammed Dadkan after the team’s failure at the 2006 Germany World Cup.

TITLE: Lebanese Elections Delayed for a Ninth Time
AUTHOR: By Nayla Razzouk
PUBLISHER: Agence France Presse
TEXT: BEIRUT — Lebanon’s presidential election was postponed for a ninth time Monday, to December 22, despite intense international efforts to convince rival parties to srike a deal and end a dangerous political vacuum.
“The parliament session that was scheduled today has been postponed to Saturday December 22 at 12:30 p.m.,” Mohamed Ballout, spokesman for parliament speaker Nabih Berri, told reporters.
The delay, the ninth since September, comes amid intense efforts by the United States and other countries to convince Lebanon’s pro- and anti-Syrian factions to proceed to a vote and avoid plunging the country into further chaos.
Lebanon has been without a president since November 23, when Emile Lahoud stepped down at the end of his term with no elected successor.
Washington on the weekend dispatched one of its top envoys to the country to meet with the rival leaders and press them to end their standoff, which marks the country’s worst political crisis since the end of the 1975-1990 civil war.
“The United States believes that it is time now to elect a new president,” said David Welch, the US assistant secretary of state for Near East affairs. “There is no reason for any further delay.”
France, Lebanon’s former colonial power which has been at the forefront of international efforts to mediate the crisis, also warned that time was running out for a solution and that Monday’s session was crucial.
“Monday is really the last chance, and France calls on all parties, inside and outside, to ensure that Lebanon can have a president,” President Nicolas Sarkozy said.
“Those (who) would take the risk of killing off that chance would cut themselves off from a number of countries, first among them France,” said Sarkozy, who is due to meet US Secretary of State Condoleezza Rice on Monday.
Although the Western-backed ruling majority and the Hezbollah-led opposition have agreed in principle to elect army cheif Michel Sleiman to replace Lahoud, they remain at odds on how to amend the constitution to allow a senior public servant to be elected. They are also bickering on the make-up of the new government and on who would be appointed to top security posts.
Simon Abi Ramia, an adviser to Christian opposition leader General Michel Aoun, told AFP earlier that Monday’s session would not go ahead as no agreement had yet been reached on a mechanism to amend the constitution.
Mustafa Alloush, a deputy with the majority, told AFP that political negotiations had reached a dead end.
“We’re back to square one,” he said.
The crisis between the two camps worsened last week after the car bomb assassination of Brigadier General Michel El-Hajj, who had been tipped to become army chief once Sleiman is elected.
Hajj joined a list of politicians and journalists who have been killed or wounded in the last three years in attacks widely blamed on Syria, which has denied any involvement.
Syria in 2005 was forced to withdraw its troops from Lebanon after a 29-year presence amid an international outcry over the assassination of former prime minister Rafiq Hariri.
The current standoff began after the Shiite militant group Hezbollah, empowered by its 34-day war with Israel last year, pulled its five ministers from the cabinet in November 2006 to gain more representation in government.
The crisis is widely seen as an extension of the regional confrontation pitting the United States against Iran and Syria.

TITLE: McCain Asks for Backing from Lieberman
AUTHOR: By Jennifer Loven
PUBLISHER: The Associated Press
TEXT: HILLSBOROUGH, N.H. — Senator John McCain, trying to keep momentum in this state’s critical Republican primary race, brought in something unusual on Monday — an endorsement from the other party.
Senator Joseph Lieberman, the Democrats’ 2000 vice presidential nominee, said he was intending to wait until after the primaries to make a choice for the 2008 presidential race. But McCain asked for his support and no Democrat did.
Lieberman, an independent who caucuses with the Democrats, said he chose his longtime Senate colleague because he has the best shot of breaking partisan gridlock in Washington. Both men also support the war in Iraq.
“On all the issues, you’re never going to do anything about them unless you have a leader who can break through the partisan gridlock,” Lieberman said. “The status quo in Washington is not working.”
Independents can vote in New Hampshire’s first-in-the-nation primary on Jan. 8 and they are the people McCain is targeting, much as he did in winning the state’s Republican primary in 2000 over George W. Bush.
Traveling with Lieberman Monday morning to Hillsborough’s American Legion hall, McCain said the Connecticut senator is his answer to the people he hears in every town hall meeting who ask, “Why can’t you all work together?”
Lieberman said McCain’s approach to Iraq and his credentials on national security are the main reasons he is throwing his support to a Republican for president.
But both men said that the election seems increasingly about the economy and domestic issues, instead of Iraq. On those issues, Lieberman acknowledged he does not always see eye-to-eye with his 2008 pick. But, said Lieberman, McCain is always straightforward about where he stands.
For McCain, behind in the polls here but gaining, the endorsement carries the risk of alienating conservatives who have been critical of his support for immigration and campaign finance reforms.
“If I get some criticism for aligning myself with a good friend I have worked with for many years, I will be more than happy to accept that criticism,” McCain said.
For Lieberman, it marks another turn away from his party.
“Political party is important, but it’s not more important than what’s good for the country and it’s not more important than friendship,” Lieberman said.
Lieberman won re-election to the Senate in 2006 as an independent, after losing the Democratic primary largely because of his support for the war. High-profile Democrats abandoned him after the primary defeat.

TITLE: Militant Nigerian Group Calls For Attacks on Oil Industry
AUTHOR: By Edward Harris
PUBLISHER: The Associated Press
TEXT: LAGOS, Nigeria — Nigeria’s main militant group on Monday urged all armed factions in the restive southern oil heartland to join together and cripple Africa’s biggest petroleum industry.
The Movement for the Emancipation of the Niger Delta, which has spurned a government peace initiative and ended a cease-fire, praised moves by another militant faction to quit the talks and called for all groups to band together.
“We call on all genuine militant groups to unite and cripple the oil industry in Nigeria once and for all and stand strong to face a common enemy,” the group said in a statement. “The time has come for all breakaway factions to come together and wage war of a different kind in 2008.”
Bombings and attacks since early 2006 by MEND have already trimmed about one quarter of Nigeria’s estimated daily crude production of 2.5 million barrels. Government officials weren’t immediately available for comment.
The group announced a unilateral cease-fire shortly after the May 29 inauguration of President Umaru Yar’Adua, but later called it off. Yar’Adua’s government has made some efforts to reach out to militants, but a widescale conference focused on peace and development for the Niger Delta has yet to materialize.
MEND said it wasn’t part of the ongoing peace efforts, which took a hit over the weekend when representatives of ethnic Ijaw fighters said they were quitting the initiative after several military operation in the Niger Delta. Violence is rising again in the region after MEND ended its truce, although nowhere near the levels seen before April’s elections, when gunbattles or attacks on oil workers were nearly daily occurences.
MEND, which claims to represent all of the region’s ethnic groups, lauded the weekend withdrawal of the ethnic Ijaw group. Militancy in the Niger Delta is characterized by shifting alliances and criminality. Much of the militants’ activities is believed to be funded by the black-market sale of stolen crude oil, or gunrunning.
The militants are trying to force the federal government to send more of the oil funds it controls to the Niger Delta region, which is deeply impoverished despite the great petroleum riches. Large amounts of that money has been stolen by the region’s leaders, many of whom are believed to have links to the militants. The militants are also suspected of helping politicians rig elections.

TITLE: Saudi Arabia’s King Pardons Rape Victim
PUBLISHER: The Associated Press
TEXT: RIYADH, Saudi Arabia — Saudi Arabia’s King Abdullah has pardoned a female rape victim who had been sentenced to 200 lashes for being alone with a man at the time of the attack who was not related to her, a Saudi newspaper reported Monday
The case had sparked international outcry. In a rare criticism of its Mideast ally, the White House had expressed its “astonishment” over the woman’s sentence. Canada called it barbaric.
Saudi Justice Minister Abdullah bin Mohammed al-Sheik told al-Jazirah newspaper that the pardon does not mean the king doubted the country’s judges, but instead acted in the “interests of the people.”
“The king always looks into alleviating the suffering of the citizens when he becomes sure that these verdicts will leave psychological effects on the convicted people, though he is convinced and sure that the verdicts were fair,” al-Jazirah quoted al-Sheik as saying.
The victim in the case, known only as the “Girl of Qatif” after her hometown in eastern Saudi Arabia, was in a car with a high school friend in 2006 when they were attacked and raped by seven men.

TITLE: New England Coach Pledges To Get Results
AUTHOR: By Angus MacKinnon
PUBLISHER: Agence France Presse
TEXT: LONDON — Fabio Capello embarked on the task of restoring England’s football fortunes on Monday with a pledge to drag the best out of the country’s under- performing stars.
The Italian, who has a reputation as a strict disciplinarian, also issued a warning that no one could take a place in his team for granted.
“Places in the national team have to be earned through behaviour, play and attitude,” he said, while declining to offer any real clues as to his thinking on issues such as whether John Terry continues as captain or whether David Beckham gets to complete a century of caps.
Capello, who vowed that he would be able to communicate with Wayne Rooney and co. in English by the time he formally takes up the post next month, is confident he can revive a squad still smarting from their failure to qualify for Euro 2008.
“I believe English footballers have born into them this great will to win and love of their country,” he told his first press conference since being named as the successor to Steve Mc-Claren, who was sacked last month after a defeat by Croatia confirmed that England would not be going to next year’s finals.
“It is just a question of getting it out of them and I greatly hope to be the man to do that.
“I want to try to understand what has happened (in the past) by talking to the players. Wearing the national shirt should be a matter of pride and I want to see them performing as they do for their clubs.” Asked why he felt he could succeed where his predecessors failed, Capello replied: “I hope it will be different. If I accepted the task it is because I believe I can do well.” The former Milan, Real Madrid, Roma and Juventus coach will not face a competitive international match until the autumn of next year, when England begin their bid to reach the 2010 World Cup from a group that again includes Croatia.
By then, Capello plans to have established the nucleus of his side, and he made it clear that he will not shirk from making changes if he believes they will produce a more effective outfit.
“The four matches we will play from now to June will allow me to understand many things,” the 61-year-old said. “I will be able to try a few things and more importantly to form a group.” Capello’s comments about the importance of behaviour could be bad news for Terry, whose regular clashes with match officials and tendency to find himself in embarrassing positions in nightclubs have led some to question his suitability for the post.
Beckham knows at least that Capello, who famously dropped then recalled him at Real Madrid, is a fan.
“Beckham is the kind of person who when he sets himself something he achieves it, so you never know,” he said of the 32-year-old’s ambition to play on for his country until the 2010 World Cup.
“With Beckham the only thing you would wish for is that he would be younger.” FA Chief Executive Brian Barwick voiced confidence that Capello’s strong personality would ensure he succeeds.
“He is tactically astute with a prove pedigree, a winner with a capital W,” Barwick added. “We know we owe the fans and we believe that Fabio Capello is the man to restore our pride.” Although Capello clearly understood most of the questions fired at him by an audience of nearly 200 reporters, he was able to make only a short statement in hesitant English before switching to his native tongue.
“I’m very proud and honoured to be the England manager,” he said. “I have wanted this job for a long time. At this moment by English is not so well (sic), so I prefer to answer in Italian.” He added: “It is a job everyone wants and as everyone knows that there are great expectations, and I am going to work to achieve them.” Capello revealed that he had spent Sunday watching the Arsenal v Chelsea and Liverpool v Manchester United matches on television.
Asked if the frantic nature of those encounters had made him aware of the difficulty of getting players schooled in that style to adapt to the international game, Capello responded with a smile.
“Good question,” he said. “This is something I am going to have to work on.” In an assured performance, Capello deftly sidestepped questions over the size of his salary — widely reported to be in the region of 6.5 million pounds (13.1 million dollars) per year — and the fact that no Englishman had been deemed suitable for the task.
Barwick however insisted that noone would quibble about the cost of Capello and his four Italian back-up staff if he delivers.
“The gross income of the FA in the next four and a half years may well be in excess of one billion pounds,” Barwick said. “Whatever figure is put on what Fabio is earning, it is a very small percentage of that overall figure and if he turns English football around it will be money well spent for the fans.”

TITLE: Chelsea Goalkeeper Accepts Blame
For Defeat Against Rival Arsenal
PUBLISHER: Agence France Presse
TEXT: LONDON — Chelsea goalkeeper Petr Cech said there was no-one to blame but himself for the mistake that presented Premier League leaders Arsenal with a 1-0 victory over their London title rivals.
Arsenal’s win kept them a point clear of Manchester United at the top of the table and six ahead of thirdplaced Chelsea.
But their decisive goal at the Emirates Stadium came about when former Chelsea defender William Gallas headed in after Cech completely misjudged the flight of a Cesc Fabregas corner the Czech Republic keeper should have caught.
“It is difficult and for me I am disappointed because, in the end, the game was decided by my mistake,” Cech said.
“It was a mistake from me. There is no explanation or excuse. It was a simple as that.
“This is the part of the game. You play in these big games with this passion.
These are the best games to play in and you always want to do your best.
I love this type of game, but will not remember this one as one of the best ones.
“You have to analyze yourself and see why you made a mistake, what was the moment you could have done better.
Of course you have to watch it, but in the end you have to turn the page and go on.” Cech added: “When you see the game overall, in the first half, they had no chances. They had nothing, only a bit of possession but that was it. We controlled every movement they tried to do.
“They had only one corner, I made a mistake and they were 1-0 up.” But he insisted the result would not have a decisive bearing on the destiny of the title. “There is still a long way to go. We play them (Arsenal) at home and have plenty of games left so we can do it again.
“There are still big games between the big four (Arsenal, Manchester United, Chelsea and Liverpool) so they can slip there.”

TITLE: Rodriguez Positive on Move to Michigan
AUTHOR: By Larry Lage
PUBLISHER: The Associated Press
TEXT: ANN ARBOR, Mich. — Michigan’s coaching search may have lasted longer than it wanted and the school might not have landed its top choice, yet college football’s winningest program is thrilled to have West Virginia’s Rich Rodriguez.
And the feeling is mutual.
Rodriguez, who flirted with the Alabama job a year ago, said it took a job of Michigan’s stature for him to leave his home state and alma mater.
“It was a very difficult decision to leave a place where I grew up,” Rodriguez said during his introductory news conference Monday morning. “It was going to take a very special opportunity and a very special place and I think that’s what this is.” The 44-year-old Rodriguez represents the first head coach to come outside the “Michigan family” as athletic director Bill Martin put it, since Bo Schembechler in 1969.
“Do you have to be a Michigan man to be a Michigan coach? Gosh, I hope not. They hired me,” he said.
Before hiring Rodriguez, the Wolverines apparently went 0-for-2 in their first coaching search since hiring Schembechler away from Miami of Ohio, with LSU’s Les Miles and Rutgers’ Greg Schiano turning down reported opportunities to replace the retiring Lloyd Carr. Rodriguez, though, seems to be much more than a consolation prize.
He built West Virginia into a Big East power, winning the conference championship this year for the fourth time in five seasons and going 60-26 overall.
Rodriguez said he’s aware of the heightened expectations in Ann Arbor.
“I don’t want our team to expect to win,” he said. “I want our team to deserve to win.” Rodriguez’s hiring marks the second time in eight months that Michigan has lured a coach out of Morgantown.
John Beilein, who successfully built up the Mountaineers’ basketball program, now leads the Wolverines.
Rodriguez said he was excited to be back with Beilein, whom he described as a good friend and a former neighbor.
He said goodbye to the Mountaineers during an emotional meeting Sunday in Morgantown.
“You’ve got to do what you’ve got to do sometimes,” West Virginia fullback Owen Schmitt said. “He did all he could for us. As far as I know he did a lot of great things for this university.” Rodriguez said he doesn’t expect to coach West Virginia when it plays Oklahoma in the Fiesta Bowl. He said it typically is the university’s job to make the decision on who would coach in the bowl game.
“My focus is going to be on the University of Michigan, and I don’t think it best serves West Virginia if I’m thinking about the Big House,” he said.
Don Nehlen, a former West Virginia coach and Michigan assistant, on Sunday said he expected Rodriguez to skip the Fiesta Bowl to focus on his new job.
“He’s got a lot of work right away at Michigan, where he has to assemble a staff and catch up on recruiting,” Nehlen told The Associated Press.
Carr has said he will coach Michigan in its Jan. 1 matchup with Florida in the Capital One Bowl.
Rodriguez said he doesn’t want to be a distraction to Carr and the current team as it prepares, but he does acknowledge the desire to get started right away.
As Nehlen predicted, some in West Virginia are not happy with the means by which Michigan got Rodriguez or the end result.
“I would hope and pray ... they’ll look at what we’ve done over the last seven years there. ... That we’ve left it in a pretty good situation,” Rodriguez said.
Martin and university president Mary Sue Coleman talked with Rodriguez, his wife and agent Friday in Toledo, Ohio. West Virginia athletic director Ed Pastilong met with Rodriguez on Saturday, saying they talked about general issues within the program.
Pastilong had said he was unaware Rodriguez went to Toledo and declined to disclose whether he had given Michigan permission to talk to the coach.
West Virginia Gov. Joe Manchin blamed the involvement of what he termed “high-priced agents” in college sports.
“I have known Rich for most of his life, from a boy whose only wish was to play football at WVU to a young man whose only wish was to coach at WVU,” Manchin said in a statement. “Something is wrong with the profession of college coaching today when a leader’s word is no longer his bond.” Alabama’s interest in Rodriguez last year wore on the Mountaineers for several days before he agreed to a one-year contract extension through 2013. The deal included a $4 million buyout clause if he leaves before next September.

TITLE: Terry Out With Broken Foot
PUBLISHER: Reuters
TEXT: LONDON — Chelsea center back John Terry will be out of action for up to six weeks after a scan on Monday showed he had broken three bones in his right foot.
The Chelsea and England captain sustained the injury after being caught by Emmanuel Eboue in the first half of Sunday’s 1-0 defeat by Arsenal at the Emirates Stadium.
“Terry has fractured three bones, including his third metatarsal,” a club statement said. “He will start his rehabilitation immediately.”
The defender has only recently recovered from a knee injury that kept him out for seven games and also forced him to miss the end of England’s unsuccessful Euro 2008 qualifying campaign.
Chelsea striker Salomon Kalou said Eboue, an Ivorian compatriot, had apologized to Terry for the challenge.

TITLE: 12 Years of Being the Voice of Business
TEXT: The St. Petersburg International Business Association for North-Western Russia celebrated its 12th anniversary on Thursday, October 25, 2007, at the Mansion of A.F. Kelch (the Lawyer’s House).
More than 120 people representing SPIBA members – companies, partners and guests, attended the reception.
Ludmila Murgulets, Chairperson of the SPIBA Executive Committee, was the first to welcome the guests and made an overview of SPIBA’s achievements.  She also outlined current activities and innovations such as the SPIBA Cultural Discovery events, renovation of the SPIBA Marketing Committee, etc.
Then SPIBA’s committees spoke.
Marina Grinevskaya, HR Director of Framos/Lumene and co-chairperson of the SPIBA HR Committee, spoke about the active efforts of the SPIBA HR Committee to meet a challenge related to lack of personnel and opportunities to exchange experience and ideas, which the Committee provided for its members. 
Igor Dyukov, Stockholm School of Economics in Russia, told the participants about the operation of the SPIBA Marketing Committee, which has become more active this year to meet the demands of SPIBA members.
Natalia Kudryavtseva, SPIBA Executive 
Director, highlighted the major achievements of the SPIBA Legislation and Lobbying Committee and expressed her gratitude to the Committee’s members for their input to the improvement of the regional investment climate.
The association received congratulations from the Government of St. Petersburg and the Leningrad Oblast. In particular, birthday greetings came from Sergei Fiveisky, the First Deputy Chairman of the St. Petersburg Committee for Economic Development, Industrial Policy and Trade, Valentin Malyshev, the Head of the Investment Policy Department of the Economic Development Committee of the Leningrad Oblast, and Dmitry Krasnyansky, the Deputy Chairman of the St. Petersburg Elections Commissions.
Members of the Executive Committee congratulated Natalia Kudryavtseva on the 12th anniversary of SPIBA, and also expressed their best wishes on the occasion of Natalia’s jubilee which fell on the same date.
After the official part of the Reception, the participants enjoyed the buffet and networking, as well as live instrumental music performed by the band Puttin’ on the Beatles Style.
SPIBA will continue its efforts to act as the voice of business, promoting members’ common interests and cooperating closely with 
local policy making institutions.

TITLE: SPIBA Members Updated On Current State And Perspectives Of City Transit Policy
TEXT: The transport infrastructure is one of the major challenges in a megapolis. Can we expect improvements?
We received some answers on November 29, 2007, when SPIBA held its General Meeting at the Neidgart Mansion. The guest speaker at the meeting was Nikolai Asaul, the Chairman of the recently established St. Petersburg Committee for Transport-Transit Policy. He made a highly professional presentation about the operations of the Committee, the current state and perspectives of the city transit policy and the key transport-infrastructure projects to be implemented in St. Petersburg.
Presentation of Nikolai Asaul is available at the SPIBA office. Please contact us at pr@spiba.ru
To obtain more information about the 
St. Petersburg Committee for Transport-Transit Policy, please visit the official site of the 
St. Petersburg government at www.gov.spb.ru

TITLE: SPIBA Committees’ Reports
TEXT: During 2007 SPIBA’s Committees successfully worked to provide a platform to exchange experience and ideas related to key business issues and to develop a dialogue with authorities to achieve SPIBA goals and objectives.

The SPIBA Legislation & 
Lobbying Committee made good progress in improving the investment climate in the region.
In 2007 quite a number of meetings, such as the Committee’s meetings, round tables, briefings, and seminars, were organized with the participation of representatives of the Government of St. Petersburg and the Leningrad Region, and of tax and antimonopoly authorities to deal with key business issues. Amongst the issues touched upon were special economic zones, tax exemptions for investors in St. Petersburg and the Leningrad Oblast, complex issues of tax legislation, issues of development of small power supply systems, customs preferential regimes for the automotive industry, and customs payments for in-kind contributions to charter capital. All these meetings and events aim at establishing a constant dialogue between authorities and businesses.
The Committee plans to further develop its activities focusing on the following key aims:
• To identify the most significant issues relevant to SPIBA members at the federal legislative level.
• To initiate the preparation of amendments to the current legislation and organize negotiations with the Committee for Economic Development, Industrial Policy and Trade of St. Petersburg Administration in view to develop and improve local tax legislation and eliminate the drawbacks of the existing tax legislation (regional tax, investment, real estate).
• To assist SPIBA members in holding round-table meetings with high-positioned representatives of St. Petersburg and Leningrad oblast authorities to discuss current business problems and further improvement of the investment climate in the North-West Region.
• To initiate and support an open dialogue with tax customs authorities in regard to tax issues, and possible amendments to the tax legislation.
• To provide SPIBA members with regular updates on recent tax and administrative court practice in the North-West Region.
• To initiate and participate in the preparation of internal meetings of SPIBA members regarding topical tax issues.

Over the last two years Elena Zaitseva, DLA Piper, and Dmitry Babiner, Ernst & Young, successfully served as Chairpersons of the SPIBA Legislation & Lobbying Committee.  As their term expires on 20 December 2007 the Committee will hold elections of Co-Chairpersons.

The SPIBA HR Committee successfully functioned as a forum for exchanging views and experience in the field of personnel recruitment, retention and development.
In 2007 the Committee held 9 meetings and 2 round tables that covered a wide range of key aspects related to human resources, which were highlighted by a survey conducted among SPIBA members.
The discussion of topical issues related to the Russian labor legislation and introduction of innovations to the HR legal framework are always very substantive points of the Committee’s agenda.
Another burning issue is the lack of personnel.  The Committee’s members spent much time exchanging ideas and experience to overcome this challenge. A number of meetings of the Committee and round tables focused on ways to find employees: how to overcome problems existing in the interaction between companies and high schools, and how to attract workers from other regions of Russia and CIS countries.  Committee members also discussed difficulties in the collaboration between employers and vocational schools to fill “blue collar” vacancies.
The latest Committee meeting was devoted to the results of two surveys: analysis of means of finding jobs and applicants’ job expectations.
The Committee will continue its active work to discuss and resolve burning HR issues.

Chairpersons of the SPIBA HR Committee:
Marina Grinevskaya, Lumene/Farmos;
Oksana Pochtivaya, AVANTA Personnel;
Elena Eibshits, FINTRA.

The SPIBA Marketing Committee has reinvented itself to provide a platform for marketing and PR specialists to exchange ideas and experience and obtain useful information on marketing-related issues and market trends.
In 2007 the Committee organized 8 meetings devoted to priorities set by SPIBA members, such as SPIBA marketing strategy, global trends in marketing,  B2B marketing, internet marketing, etc.
The site visit to the Baltika Brewery in July 2007 featured the Marketing Committee program. More than 50 representatives of SPIBA member-companies took a chance to learn about Baltika’s strategy in its highly competitive market from Marcho Kuyumdzhiev, Vice-President for Marketing of Baltika Brewery, and to enjoy a tour of the production facilities.
Another event that received highly positive feedback was the seminar on Branding, which was arranged by the Committee in October.  During the meeting professionals from various sectors shared their experience in the creation and promotion of brands with their colleagues.
The Committee has a very interesting 
program which will continue next year.

All the SPIBA’s Committees are open to new members, suggestions, and  ideas.  For more details, please contact Natalia  Kudryavtseva, SPIBA Executive Director, at nak@spiba.ru, or Svetlana Solovieva, SPIBA PR Manager, at pr@spiba.ru, or by telephone at +7-812-325-9091, 579-1815.

TITLE: SPIBA Christmas Party at the Konstantin Palace
TEXT: As usual, SPIBA celebrated the forthcoming New Year season early on Saturday December 8, 2007. The SPIBA New Christmas Party at the Konstantin Palace, which functions as the coastal residence of the President of the Russian Federation and a congress center, brought together a large group of SPIBA members and guests.
The festive program started with an exclusive preview of the collection of Rostropovich and Vishnevskaya and a Charity Fair which was part of the city’s charitable festival Dobry Piter (Kind St. Pete).
The participants of the party enjoyed the beautiful interiors of the Konstantin Palace, the delicious gala dinner, friendly home-like atmosphere with Irina Smolina as the master of ceremony, live music by the trio Verona, dancing, amusing contests, and the traditional SPIBA lottery.  
The luckiest guests received lottery prizes presented by Ambassador Hotel, the companies BusinessLink Personnel, Deloitte, DLA Piper, Globus-Leasing, Grand Hotel Europe and Novotel St. Petersburg Centre Hotel.

SPIBA is grateful to sponsors of the New Year Party:
Kappa St. Petersburg and PepsiCo Holdings

and the supporters:
Alba, Baltika Breweries, Baltic Travel Company, Norman DL Consulting, Salans and Veda.

TITLE: SPIBA Companies News
TEXT: The number of employees in the St. Petersburg office of ANCOR increased to 75 persons this autumn, which made it possible to augment monthly sales in comparison to the precedent quarter by 47%. Presently the regional network of the company includes 30 offices on the territory of Russia, 4 offices in Ukraine and also offices in Belarus and Kazakhstan. The total number of employees of the company is currently about 1000 people. In 2008, ANCOR recruitment is planning further regional expansion on the territory of Russia, as well as to neighboring countries.

New General Managers have been appointed in Rocco Forte’s Astoria and Angleterre Hotels. Alexander Pichel joined The Rocco Forte Collection in October 2007 after many years with Hyatt International and is in charge of the Astoria.
Mirco Zanini joined the company in 1998 as Restaurant Manager of the Hotel Astoria, going on to fulfill several roles before taking over as Director of operations for both hotels from where he was promoted to his new role of General Manager of the Angleterre Hotel.

A+ Estate, LSR Group, reports that it is about to commence the first stage of commercial property in Paradny Quarter located in the very heart of the city, near the Tauride Gardens. Paradny Quarter is unprecedented in the scale of its construction project in the city center. 
A+ Estate offers for lease not only separate prime offices, but also entire buildings built using the most advanced architectural and engineering solutions. Tenants will also benefit from the unique infrastructure of the quarter. It is planned to commence three four-story office buildings of 5,000 sq. meters each in early 2008.

AVANTA Personnel released a Salary Survey for the following regions of Russia: Vladivostok, Yekaterinburg, Krasnodar, Novosibirsk, Perm, Samara, and St. Petersburg. The first large scale survey contains data from more than 220 companies regarding the main business spheres including information about payment policy and salary indexation; payment of bonuses and comissions, benefits, and compensation. A detailed report is drawn up for every city individually.
On November 15, 2007, an international jury of the European Beer Star Awards-2007 at the BRAU Bievale Exhibition in Nuremberg announced the results of a competition in which 575 varieties of beer from 28 countries around the world took part. Two Baltika Breweries brands simultaneously received top awards from this highly prestigious competition within the worldwide beer brewing sector. Baltika Cooler won the bronze award in the “Mild Beer” category, while Arsenalnoye Zakalennoye received the bronze in the “Herb and Spice Beer” category. The organizers of the competition were the Association of Private Breweries of Germany and the Association of Independent Breweries of Europe. 
In December the results of the annual National nationwide business prize “Company of the year, 2007” were summed up. 
In the award category “Industry: low alcohol beverages and beer,” Baltika Breweries was the prize winner.
Each year the national prize for “Company of the Year” is a unique event for the Russian business community. This is the main social event in the business life of the country, and represents a public act summing up the business results of the year.

BDO Unicon North-West won the 2007 Region Developing Business contest in the Culture and Art Development category.
This contest is one of the most significant events in the business life of the North-West region.  
BDO Unicon North-West has previously won this contest in the Business to Business (2003) and Activity in Innovative Industry (2005) categories. The new Culture and Art Development award is the highest recognition of Company’s efforts to preserve Russian traditions and promote the region’s social and economic development.

In October 2007 BusinessLink Personnel  completed a research project called “How Do You Look For A Job?” that was begun in July. Over a period of 11 weeks, 324 people, who came to the agency to be interviewed, filled in research questionnaires. The goal of the research was to indicate the sources used by candidates while searching for a new job, and to establish the dependency of the source choice on different factors (age, income, position). The research results can be found at the Press-Center on the BusinessLink Personnel website (www.blp.ru).

On December 6, 2007, DLA Piper held a Gala Opening Reception for its clients and friends in the Singer Building celebrating its move to the historical building on Nevsky 28. The Singer Building, the first business center in St. Petersburg, a miracle of art nouveau, opened its doors to the public for the first time after renovation works which restored the initial beauty to the building’s interiors. Fireworks on the square in front of the Kazan Cathedral marked the culmination of the event.

On November 28, 2007, DHL opened a new Service Point at 2, Lev Tolstoy Ulitsa on the Petrograd Side of St. Petersburg.
DHL, the global leader in Express and Logistics, has increased the number of Service Points in St. Petersburg to 6, increasing its accessibility for customers in North-West Russia. The conveniently-located Service Point is situated five minutes from Petrogradskaya metro, and close to the commercial and residential center of the Petrograd side of the city. The opening hours of the Service Point are 0800 until 2100, five days a week.
The Service Point is fully equipped with the latest state-of-the-art packaging and shipment processing materials for customers, whilst the unique DHL software ensures that customers are able to gain access to the status of their shipment at every step of its transportation.

The Finnish IT service provider Enfo is expanding its business and launching information technology services for clients based in and around St. Petersburg and Moscow.
The company signed its first agreement for the Russian market on October 2, 2007 with the leading Finnish department store chain, Stockmann. Based on this agreement, Stockmann, which is growing rapidly on the Russian market, will use Enfo’s software management and hardware sourcing services in Russia.
Enfo had an opening ceremony of its new office in St.Petersburg on November 22, 2007.

The European University in St. Petersburg welcomes applications for a 1-year exclusive educational program for top-managers – Executive Master of Philosophy. It is specially designed for those who wish to get international knowledge taught by the best Russian professors who have long experience in teaching both in this country and abroad. The program is built on the concept of an Executive MBA; however, unlike EMBA it consists of only social sciences: History, History of Arts, Cultural Studies, Philosophy, Sociology, and Anthropology.
Contact: asamoletova@eu.spb.ru (Alla Samoletova).
Four new world level professionals began to work for the Graduate School of Management, St. Petersburg State University (Master’s degree programs). According to the general conception of GSOM development, by 2015 the faculty will reach 120 members — 80 full time and at least 30% foreign professors.
In the 2007-2008 academic year, four notable researchers and advisers with long-term practical activity of teaching within leading business schools — Oliver Bertrand, Mikhail Klimenko, Christos Pitelis and Simon Commander – are to share their experience and knowledge with Master’s degree program students.

The management of the Grand Hotel Europe and BMW Russland Trading have signed an agreement to update the hotel’s fleet of automobiles.  The hotel now has 6 new 740 Li and one 730 Li series limousines at its disposal. Now the Grand Hotel Europe fleet, the biggest in Europe, boasts 14 BMW limousines, in addition to 2 Classic Volga Cars and several excursion buses and a luxury Mercedes Viano mini bus to provide its clients with safe and comfortable transportation.

ITM Group (ZAO INTECH) and DURR company have signed a contract according to which the division ITM Technostal will manufacture and supply metal structures for the car assembly enterprises currently under construction — Volkswagen in Kaluga and General Motors in St. Petersburg.
ITM Group carries out design and installation works on engineering systems at the unique wood-processing factory in the city of Torzhok. Taleon Club is the project investor. 
Experts of ITM Group company have begun work on the reconstruction of the Pervomaiskaya thermal power station-14, which is included in the list of priority projects of TGK-1’s investment program for 2006-2015.

Cres Neva factory, a member of JT International Group of companies, became one of the winners of the competition organized by the Leningrad Oblast Government: “Enterprise of high social responsibility” and was awarded the 2nd place in the nomination: Employee remuneration and motivation. The award ceremony took place on November 29, 2007.
The Cres Neva factory, located in Gorelovo in the Leningrad Oblast, is the largest Russian producer and exporter of the expanded tobacco stems CRES and the expanded tobacco leaf DIET, used in the production of cigarettes.
In October 2007 Maris Properties LLC concluded a co-exclusive agreement with Autohouse LLC to lease a new Class A business-center.  The International business center RESO is due to become part of a high-level office complex just outside the center of the city.  The building is located in the Primorsky district close to the metro station Staraya Derevna.  The international business center RESO becomes the first high-rise office building on the real-estate market of St. Petersburg – the height ofthe  21-floor building exceeds 75 m. This multi-purpose complex has a total area of 55-315 sq. meters and consists of both office and retail-exhibition areas. This project is due to reach completion in the second quarter of 2008. 
However, a milestone for Maris Properties was reached in 2007 with the opening up of two new departments and the addition of new staff.  “With the team formed in 2007, we are able to put into use the very considerable increase in turnover and extend our presence into different branches of the real-estate market in 2008”, – said Boris Moshensky, the General Director of the company. Work in the 2 new departments – Property Management and “Industrial & Warehouse, Property Lands” – has now begun and they are looking forward to the challenges ahead.

The law firm Maslennikov & Partners (MiPart) facilitated a closing on the Sidewalk of Europe contract, which was carried out according to the Government Resolution # 1209R (as of August 30, 2006) on November 26, 2007. Under this contract a private developer is investing his own money into new location transfer and modernization of courtyard simultaneously of the Federal State Unitary Enterprise “Russian Scientific Center “Applied Chemistry” (RSC “Applied Chemistry”). This could be a good start to reestablish the private and Government partnership with the industry in St. Petersburg and other regions of Russia.

We are pleased to inform you that Rosexpertiza Ltd has become a full member of Praxity AISBL, a new international audit alliance, which was established by the joint initiative of Mazars company and key members of MRI, which unites more than 23,000 specialists from 135 companies of 69 countries. Praxity’s main purpose is to provide a high level of cooperation between its members. Closer relations within the Alliance are the main distinction from the previous one and it is respondent to all international needs. The new Alliance uses increased membership criteria requiring members to meet the highest international quality control standards.