SOURCE: The St. Petersburg Times
DATE: Issue #1428 (92), Tuesday, November 25, 2008
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TITLE: Medvedev, Bush Say Goodbye In Lima
PUBLISHER: Reuters
TEXT: LIMA, Peru — President Dmitry Medvedev on Saturday held the last meeting of a Russian leader with U.S. President George W. Bush, who is to leave office in January, where Bush told Medvedev that he had worked hard to make it a “cordial relationship” despite difficult disagreements. 
The meeting took place at an Asia-Pacific Economic Community summit in Peru, part of a Latin American tour by Medvedev expected to lead to the negotiation of a number of business agreements with South American and Caribbean nations. 
The meeting with Bush came against a backdrop of chilly U.S.-Russian relations following Moscow’s war with Georgia in August and Washington’s agreement to base a missile-defense system in Eastern Europe. 
“It’s an interesting moment because I’ve had a lot of meetings with Dmitry and Vladimir Putin,” said Bush, who once famously told reporters that he had gotten a sense of Putin’s soul. “This will be my last meeting as the sitting president with the leader of Russia.” 
“We’ve had our agreements. We have had our disagreements. I’ve tried to work hard to make it a cordial relationship so when we need to work together we can, and when we disagree we’re able to do so in a way that is respectful to our two nations,” he said. 
Medvedev, who shook hands with the U.S. president in a flag-draped hallway of the waterfront Marriott Hotel, agreed that the two sides had kept lines of communication open. 
“Generally, despite the existence of points in which we strongly differ, we have worked well and will continue this work,” the Russian leader said. 
Bush and Medvedev discussed a range of topics, from the Georgia conflict and missile defense to Iran’s nuclear program, officials for the two sides said. They agreed to explore a joint strategy to combat the recent bout of piracy off the Horn of Africa. 
“The meeting went in a very good atmosphere, with both leaders understanding the importance of relations between the two countries,” Russian Foreign Minister Sergei Lavrov told reporters. “There was a clear desire not to get obsessed with differences.” 
In a meeting Saturday with the leader of another nation with which Russia has had differences, Japanese Prime Minister Taro Aso told Medvedev that he would like to see an end to a territorial dispute that has soured bilateral ties since the end of World War II. 
The dispute over the territories, known as the Kuril Islands in Russia and the Northern Territories in Japan, has prevented the two states from signing a formal peace treaty since the war ended. 
“The problem remains an element which destabilizes the situation in the region,” Aso told Medvedev at the start of their meeting at the forum. 
Looking ahead to the rest of the Latin American visit, the deputy head of Gazprom, Alexander Medvedev, said the president will discuss the creation of a joint consortium to further develop the Orinoco oil field during a visit to Caracas, Venezuela, on Wednesday. 
“The consortium will be the main theme [of energy talks in Caracas],” Alexander Medvedev told reporters on the sidelines of the APEC summit. 
“We hope certain agreements on this will be reached.” 
The consortium has been discussed by five Russian energy companies — Gazprom, Rosneft, Lukoil, TNK-BP and Surgut — and Venezuela’s state oil company PDVSA. But some analysts have said the recent plunge in oil prices could make it less lucrative. 
Alexander Medvedev said the final decision on creating the consortium will follow the signing of an intergovernmental agreement between Russia and Venezuela, which is now in  the the works. He gave no details.

TITLE: Russia Denies Targeting Presidents
AUTHOR: By Matt Siegel
PUBLISHER: The Associated Press
TEXT: AKHMAJI, Georgia — Russia’s foreign minister has suggested that a weekend shooting incident near a motorcade carrying the Georgian and Polish presidents was planned by Georgia to discredit Moscow and its separatist allies.
The shooting late Sunday stoked anger months after Georgia and Russia’s August war over the separatist region of South Ossetia. The summer conflict worsened Moscow’s relations with the West.
Georgian President Mikhail Saakashvili has blamed Russian troops for the gunfire that broke out as he and Polish President Lech Kaczynski were traveling near a roadblock at the edge of Georgia-controlled territory.
Russian Foreign Minister Sergey Lavrov said there was no gunfire from Russian or South Ossetian positions and suggested Georgia engineered the incident to discredit Russia and South Ossetia, Russian news agencies reported.
“This is a provocation, clearly,” Interfax quoted Lavrov as saying late Sunday in Peru, where he was accompanying President Dmitry Medvedev. “It’s not the first time something like this has happened: They organize everything themselves and then blame the Russian or Ossetian side.”
Video footage shot by Georgian television shows the motorcade next to the Russian checkpoint as gunfire erupts off camera.
Kaczynski said Sunday that the shots were fired from only about 30 meters from the motorcade. He said it was not clear if the gunfire was aimed at the motorcade or if the shots were fired into the air.
“I know from their shouting that they were Russians,” Kaczynski said.
Georgian police have brought rocket-propelled grenade launchers to their heavily fortified positions in the area, near the disputed territory of Akhalgori. It was unclear exactly when the weapons were moved in, but they had not been visible a few weeks ago.
Russian-backed soldiers blocked the road into the region Monday. At a checkpoint, visibly agitated Ossetian troops shouted threats at an Associated Press reporter as he approached.
One leveled a machine gun at the reporter and demanded that he leave immediately.
“Get out of here,” the soldier said, raising his gun. “And don’t you dare come back.”
No Russian troops were visible at the checkpoint, which is supposed to be under joint Russian-South Ossetian command.
Akhalgori is particularly tense. Unlike most of South Ossetia, it was controlled by Georgia before the war. Georgia says the presence of Russian and South Ossetian forces there violates the terms of a French-brokered cease-fire that called for a return to pre-conflict positions.
The war broke out when Georgia launched an offensive Aug. 7 to gain control of South Ossetia. Russia sent in troops that routed the Georgian military. Russia recognized South Ossetia and another breakaway province, Abkhazia, as independent nations after the war and deployed thousands of troops to both regions.

TITLE: Olympic Costs and Investment Uncertain Amid Crisis
AUTHOR: By Maria Antonova
PUBLISHER: Staff Writer
TEXT: MOSCOW — The announcement that Sochi had won the right to host the 2014 Winter Olympics generated cheers and expressions of greater self-confidence from across the country last year. But you cannot blame people for having some doubts after the economic news of recent months. 
Prime Minister Vladimir Putin, — president at the time — attended the voting last year in Guatemala City to lobby for the bid personally and was positively beaming after the announcement was made. 
But, as his government wrestles with the financial crisis and private investors continue to bleed cash, the $12 billion — unprecedented for a Winter Olympic Games — allotted to prepare the Black Sea resort city to host the games might be looking like an increasingly steep price to pay to boost national prestige. 
Preparations to host the Olympic Games have never come off without a hitch, and the organizers of the 2012 summer games in London are already talking about scaling back some of their grandiose construction plans due to an inability to secure bank loans. 
But statements from the Sochi Organizing Committee, state corporation Olimpstroi, which was created to manage state expenditures on the projects, and Dmitry Kozak, recently appointed as deputy prime minister to oversee the preparations, remain positive and ambitious. 
“We have no fears about the realization of the project,” Kozak told reporters on Friday. “So far, everything is moving forward as planned.” 
The appointment last month of Kozak — someone Putin has regularly made point man in dealing with the country’s most pressing issues — came as a sign of how important maintaining central oversight and control of Olympic preparations is to the government. 
The original Federal Target Program calls on the federal government to provide 186 billion rubles — about 60 percent — of the total 314 billion rubles ($11.6 billion) to fund the games. 
“Not one element is being pulled out of the program, but saving on costs has been established as a task,” Kozak said, adding that costs could end up being 10 percent to 15 percent lower. 
In a positive twist, the global recession will likely help the government spend less by putting downward pressure on prices for materials. Cement prices, for example, have fallen by 50 percent over the last three months. 
Lower expenditures would buck a trend. In October, for example, the State Duma voted to increase Olympic-related expenditures in the federal budget by 23 billion rubles over the next two years. Then, two weeks ago, Putin approved an increase in funding for Olimpstroi by 29.7 billion rubles, bringing the total to 181 billion rubles. 
But the precipitous fall in world oil prices — by about two-thirds since early summer — has raised questions about the state’s ability to cover all expenses laid out in the budget. The government has said that a world oil price of $60 per barrel is necessary to cover all expenditures in 2010. The current price is about $50. 
Following the passage of the budget for 2009-2010 by the State Duma, the Federal Audit Chamber published a statement on its web site criticizing the “insufficient transparency of legislation pertaining to the preparation and holding of the games.” 
Audit Chamber head Sergei Stepashin advised the Duma to pay special attention to increases to the budget for the games. 
Audit Chamber representatives refused to comment further for this story on financing for Sochi. 
Kozak, meanwhile, disagreed with the Audit Chamber statement. 
“The legislation is crystal clear,” he said Friday. 
Despite falling material prices at present, the final cost could still end up higher than anticipated, putting even more strain on the budget. 
“The original figure of $12 billion dollars could easily double by the end,” said Irina Pilman, who works as an analyst for Standard & Poor’s in the Krasnodar region, where Sochi is located. 
The costs of many construction projects were miscalculated because the International Olympic Committee’s requirements for infrastructure quality were not fully taken into account, Pilman said. 
At the same time, inflation is likely to reduce the purchasing power of the funds set aside for Sochi. The Ministry for Economic Development said this month that the inflation rate will finish at about 13.2 percent for this year. 
The Krasnodar regional government, which is financing some of the municipal infrastructure projects, has seen costs rise while the projects are still only in the planning stages. 
“We had to add a lot to the list because many of the sites are in dire need of repair, which was not reflected in the original plan,” said Tatyana Yolich, who heads the region’s department overseeing its work on preparations for the games. 
The original plans called for the Krasnodar region to put up 9 billion rubles over the next five years, Yolich said. But that figure has already grown to 14 billion rubles. 
Kozak said in late October, after meeting with potential investors from the American Chamber of Commerce, that the final budget estimates for the games will be ready by the spring. 
“We will have the projected cost and the lineup of investors by then,” Kozak said. 
Russia is not alone, as the hosts of the next two Olympics — the 2010 winter games, in Vancouver, Canada and the 2012 summer games in London — are also working under tough conditions. 
All three hosts are “doing their best to manage any risks associated with the economic downturn,” IOC spokeswoman Emmanuelle Moreau said in e-mailed comments.

TITLE: Computer Game Simulates Georgian War
AUTHOR: By Denis Dyomkin
PUBLISHER: Reuters
TEXT: MOSCOW — A computer game simulating a new war between Russia and Georgia, in which NATO-member Poland backs a bid by Tbilisi to take back its rebel regions, is about to hit shops.
In the computer game “Confrontation — Peace Enforcement,” which will go on sale in Russia next month, Georgian President Mikheil Saakashvili gets support from unnamed Western powers and decides to launch another attack to take back South Ossetia and Abkhazia.
“NATO does not stay out of it, pushing Poland forward as its representative, and Ukraine blockades the Black Sea Fleet in Sevastopol,” according to the description of the game supplied by its creators Friday.
“Russia cannot remain out of it and launches a strike in response,” said the game’s creators, two Russian software and multimedia companies.
Russia’s Black Sea Fleet rents a base in Ukraine’s Crimean port of Sevastopol, a source of tension with Kiev. The armies of Russia, Poland, Georgia and Abkhazia are depicted in the war game.
The title of the game is a reference to President Dmitry Medvedev’s description of Russia’s actions in Georgia — an operation to enforce peace.
The Kremlin complained that the West had supported and helped arm Georgia and thus undermined stability in the Caucasus, an area Russia sees as its sphere of influence. But the makers of “Confrontation — Peace Enforcement” said the game should not be taken seriously. “Politics are politics and a game is a game,” said Alexander Dmitrevsky, the business development director at one of the game’s makers, Russobit-M.

TITLE: Ukraine Commemorates Holodomor
PUBLISHER: Combined Reports
TEXT: Ukrainian President Viktor Yushchenko on Saturday denied any notion that Russia was to blame for Ukraine’s mass famine of the 1930s engineered by Josef Stalin and urged Moscow to join commemorations for the millions of dead.
Yushchenko was speaking at the opening of a 26-meter monument to mark the 75th anniversary of the famine at ceremonies boycotted by the Russian president.
Russia objects to Ukraine’s insistence that the famine amounts to “genocide” against Ukraine’s people. 
The anniversary of Holodomor — or Death by Hunger as it is known in Ukraine — is traditionally marked in late November, when the food shortages began.
Yushchenko insists that the famine was aimed at rooting out Ukrainian nationalism, targeting the heart of the nation, its peasants, and thus is an act of genocide.
“We appeal to everyone, above all the Russian Federation, to be true, honest and pure before their brothers in denouncing the crimes of Stalinism and the totalitarian Soviet Union,” Yushchenko told guests shivering in snow and drizzle.
“We were all together in the same hell. We reject the brazen lie that we are blaming any one people for our tragedy. This is untrue. There is one criminal: the imperial, communist Soviet regime.”
Historians say some 7.5 million people died in the famine, and Soviet authorities denied for decades that it had occurred.
In the fall of 1932, authorities confiscated grain, livestock and other food in villages across the Soviet Union after peasants failed to meet grain quotas that exceeded crop yields. The Soviet Union exported the grain to build factories and arm its military.
Residents were prohibited to leave their homes — effectively condemning them to starvation, and survivors say people ate dogs, grass and that cases of cannibalism were widespread. The famine was a closely guarded secret in the Soviet times.
Yushchenko had earlier avoided references to Russia in restating his conviction that the famine was “genocide.”
“The famine of 1932-33 was not death by starvation, it was murder through starvation. This was the essence of the genocide. ... It was an artificial famine with a clear aim and clearly planned,” he told a conference in Kiev’s opera house.
Russia dismisses any such notion, saying many ethnic groups were affected. President Dmitry Medvedev did not attend the ceremonies and accused Yushchenko of distorting history.
Georgian President Mikheil Saakashvili, who like Yushchenko is seeking NATO membership for his ex-Soviet state, went further though he also refrained from referring to Moscow.
Saakashvili said attempts to downplay the famine showed that “the ideology of evil remains alive. Even 75 years after the tragedy, the seeds of evil still grow in some individuals.”
Several hundred Ukrainians braved snow and cold to light candles outside the golden-domed St. Michael cathedral in Kiev in memory of those who perished.
“It is the pain and wound of the Ukrainian people,” said a sobbing Valentyna Mayboroda, a 57-year-old retired government worker whose uncle disappeared and was believed to have fallen victim to cannibals. 
(Reuters, AP)

TITLE: Probe Into Judge's Decision Ordered
AUTHOR: By Nabi Abdullaev
PUBLISHER: Staff Writer
TEXT: MOSCOW — The Supreme Court opened an internal probe into the decisions of the judge who had closed to the public the trial of the alleged murderers of journalist Anna Politkovskaya, the court spokesman Pavel Odintsov said Friday. 
“The leadership of the Supreme Court reacted to the media reports about the incident,” Odintsov said. “After all circumstances are studied, the court might decide what to do with the judge.” 
In the first minutes of the trial on Wednesday, the judge of the Moscow Military District Court, Yevgeny Zubov, decided to close the process to the public. He told journalists and the participants of the process that the jury members refused to enter the courtroom, fearing that their names and photos would be leaked to the press. 
Later that day, one of the jurors, Yevgeny Kolesov, called Ekho Moskvy radio and said none of the jury members wanted to have the trial closed or were afraid of the journalists. 
Nineteen of 20 jurors signed a letter to Zubov on Thursday calling him to allow media at the process, which was adjourned until Dec. 1. Kolesov said late Wednesday that he had sent Zubov a request to release him from his responsibilities as a juror in protest of the judge’s decision to close the trial. 
Spokesman for the Moscow Military District Court, Alexander Minchanovsky, said Friday that none of the jurors’ letters was considered in the process Thursday and likely would not be until the trial resumes Dec. 1. 
Odintsov of the Supreme Court refused to comment Friday on what punishment Zubov might face if it is found that he abused his powers by barring the public from the courtroom. 
The president of the Moscow Bar Association, Genri Reznik, told Interfax Friday that “if the judge deliberately misinterpreted the opinion of the jury, by doing this he cast doubts about his own impartiality. 
“And this makes the grade for disciplinary punishment,” Reznik said. 
At the preliminary hearing last Monday, Zubov said the trial would be open. 
Politkovskaya’s family, her colleagues at the Novaya Gazeta newspaper, editors of prominent newspapers and media freedom groups called for an open trial. 
Defense lawyers for the three men accused of involvement in Politkovskaya’s murder – Chechen brothers Dzhabrail and Ibragim Makhmudov and Moscow police officer Sergei Khadzhikurbanov – also called for an open trial. 
The fourth defendant, Federal Security Service officer Pavel Ryaguzov, is being tried with the others in a case unrelated to the Politkovskaya murder.

TITLE: Litvinenko Suspect Ready to Work With U.K.
PUBLISHER: The Associated Press
TEXT: MOSCOW — Andrei Lugovoi, widely regarded as the top suspect in the fatal radiation poisoning of Alexander Litvinenko in London, has said he is ready to go to Britain to try to persuade authorities to step up the investigation, Ekho Moskvy reported.
Litvinenko, a former security service officer who was granted asylum in Britain, died two years ago Sunday in London from poisoning by the radioactive substance polonium-210.
British officials consider Lugovoi, another former security agent, the main suspect and have charged him with the murder. Russia has refused to extradite him.
The Ekho Moskvy web site quoted Lugovoi as saying Saturday that he is willing to go to Britain to demand prosecutors “get down to investigating” the case. He says he is innocent.
“For two years, we have been urging the British Prosecution Service to begin to cooperate with us. Nothing new has happened in the Litvinenko case for the past year, and we have been amazed that the British government has not made a single attempt to contact us,” said Lugovoi, who was elected last year to the State Duma.
The Times of London on Saturday reported that Lugovoi and Dmitry Kovtun, whom British authorities want to question as a witness, offered in an interview to send Kovtun to Britain to help with the investigation.
Litvinenko fell out with the Federal Security Service, the main successor to the Soviet KGB, in 1998 when he publicly accused superiors of corruption and plotting political killings.
He fled to Britain in 2000 and co-wrote a book alleging that the FSB was behind the deadly 1999 apartment house bombings in Russia. 
Alex Goldfarb, an associate of Litvinenko’s and author of a book about his killing, dismissed Lugovoi’s offer as “a PR stunt.”
“However, if he gives himself up to the British authorities and tells the truth about who commissioned him to murder Mr. Litvinenko, we would not object if he is given some degree of leniency,” Goldfarb said in a statement.

TITLE: Six-Year Presidential Term Approved by State Duma
PUBLISHER: Combined Reports
TEXT: The lower house of parliament gave its final approval Friday to a bill extending the presidential term from four to six years, a move widely seen as paving the way for Vladimir Putin’s return to the presidency.
The State Duma, dominated by the pro-Kremlin United Russia party, voted 392 to 57 Friday to approve the bill at its third and final reading. The bill, proposed by President Dmitry Medvedev, now goes to the equally controlled upper house where swift approval is expected.
The only opposition to the constitutional changes came from the Communists, whose proposal to limit presidents to just one term was ignored.
Parliament leaders said earlier this week that the law does not allow individual lawmakers to propose changes to the Constitution.
“All democratic principles were violated during the debate,” Communist Nikolai Ryabov said during Friday’s session. 
“The bill was passed at such a speed, it is as if people would start living better after its passage.”
Flamboyant pro-Kremlin Liberal Democratic Party leader Vladimir Zhirinovsky, whose proposal to extend the presidential term to seven years instead of six was also ignored, still endorsed the bill Friday.
“Russia has been and will remain a monarchy,” Zhirinovsky said.
The widely popular Putin, now prime minister, was barred constitutionally from seeking a third straight term as president in elections this year. His protege Medvedev resoundingly won the post in March.
If enacted, the change would not apply to Medvedev’s current term, due to end in 2012.
Putin has said the change was not tailored for him and would help boost democracy. 
But the push to enact the constitutional change just months after Medvedev’s election has led to speculation that his presidential term could be cut short to usher Putin back into the Kremlin.
Putin’s speech at the congress of the United Russia party Thursday gave no immediate signal that he was eyeing a job change soon. His message was the opposite: that Putin is eagerly and competently doing his job as prime minister to shelter the Russians from financial crisis.
But with its broad scope and attention to detail, Putin’s performance appeared aimed to cast him as the best hope for a country at a difficult time.
A survey by VTsIOM pollsters published on Friday showed that 56 percent of Russians supported a longer presidency and an extended term of parliament, while 29 percent were against and 15 percent undecided.
The longer Kremlin term will not apply to Medvedev’s present mandate, and Putin’s spokesman has said there is no plan for an early presidential election. 
(AP, Reuters)

TITLE: Solidarity Meeting Held in Moscow
AUTHOR: By John Wendle
PUBLISHER: Staff Writer
TEXT: Between 300 and 400 activists took part in new opposition organization Solidarity’s first major event on Sunday, said Lev Ponomaryov, a leading human rights advocate who participated in the conference.
A list of the country’s leading opposition politicians, including United Civil Front leader Garry Kasparov, former Deputy Prime Minister and SPS co-leader Boris Nemtsov, Young Yabloko leader Ilya Yashin, the leader of the party’s St. Petersburg chapter Maxim Reznik and former deputy energy minister Vladimir Milov, were on hand at the Izmailovo Hotel in the east of the city, although repeated calls to the hotel to verify the number of attendees went unanswered.
“The authorities have destroyed the democratic process in Russia,” Ponamaryov said. “The most important goal of the new organization is to dismantle the regime.”
Despite the new organization’s name, the absence of People’s Democratic Union leader and former Prime Minister Mikhail Kasyanov, Yabloko leader and Moscow Duma Deputy Sergei Mitrokhin and Eduard Limonov, leader of the now-defunct National Bolshevik Party, did not attend.
“We will not work with them,” Mitrokhin said Sunday. “This is a parody of the Polish Solidarity movement.” 
“I have great respect for Solidarity because it worked with the people. The people who are gathering together in Russia under this new name only know how to handle their own PR and nothing more,” Mitrokhin said.
The opposition leader questioned the need for a new organization to oppose extension of presidential terms from four years to six, proposed by President Dmitry Medvedev at the beginning of the month and passed on third reading by the State Duma on Friday.
“Why organize a new party to oppose the six-year term when we are already organized against it?” Mitrokhin said.
Neither Kasparov nor Nemtsov, the main organizers of the congress, answered repeated calls to their phones on Sunday. Concerns ahead of the event that the authorities would try to interfere proved to be unfounded, as there was no significant law enforcement presence at the hotel complex.

TITLE: US Report: Climate Change to Boost Russia
PUBLISHER: The Associated Press
TEXT: WASHINGTON — Global warming could be a boon to Russia, a European country could be overrun by organized crime and the dollar — and the United States itself — could further decline in importance during the next two decades, says a U.S. intelligence report with predictions for the world in 2025.
The report, Global Trends 2025, is published every four years by the National Intelligence Council to give U.S. leaders insight into looming problems and opportunities.
The report says the warming earth will extend Russia’s and Canada’s growing season and ease their access to northern oil fields, which will strengthen their economies. But Russia’s potential emergence as a world power may be clouded by lagging investment in its energy sector, persistent crime and government corruption, the report says.
Analysts also warn that the same kind of organized crime plaguing Russia could eventually take over the government of an Eastern or Central European country, without mentioning which one.
It also says countries in Africa and South Asia may find themselves unstable and ungoverned as state regimes collapse or wither away under security problems, water and food shortages brought about by climate change and a population increase of 1.4 billion.
The potential for conflict will be greater in 2025 as the world’s population competes for declining and shifting food, water and energy resources.
Despite a more precarious world situation, the report also says al-Qaida’s terrorist franchise could decay “sooner than people think.” It cites its growing unpopularity in the Muslim world, where it kills most of its victims.
“The prospect that al-Qaida will be among the small number of groups able to transcend the generational timeline is not high, given its harsh ideology, unachievable strategic objectives and inability to become a mass movement,” the report states.
The report forecasts a geopolitical rise in non-Arab Muslim states outside of the Middle East, including Turkey and Indonesia, and says Iran could also be a central player in a new world order if it sheds its theocracy.
The report, a year in the making, also suggests that the world may complete its move away from dependence on oil and that the dollar, while remaining important, will decline to “first among equals” among other national currencies.

TITLE: In Brief
TEXT: <b>Tsunami Warning</b>
MOSCOW (Reuters) — A 6.6 magnitude earthquake struck off Russia’s Far-East coast on Monday triggering a tsunami warning which was soon lifted, Russian emergency services said.
The earthquake struck at a depth of just over 300 km beneath the Sea of Okhotsk at 9:05 p.m. (9:05 a.m. GMT) between the Kamchatka peninsula and the Pacific Coast island of Sakhalin, the site of major oil and natural gas deposits.

<b>Sub Man Charged</b>
MOSCOW (AP) — Russian news agencies say authorities have charged a sailor with fatal negligence in the deaths of 20 people aboard a nuclear submarine this month.
The state-run RIA-Novosti news agency says Dmitry Grobov faces up to five years in prison if convicted.
Authorities have accused Grobov of setting off a fire-extinguishing system aboard the newly built submarine during a test run in the Sea of Japan on Nov. 9.

TITLE: Unemployment Rate at 7-Month High
AUTHOR: By Toni Vorobyova
PUBLISHER: Reuters
TEXT: MOSCOW — The country’s unemployment rate rose to a seven-month high, and retail sales grew at their weakest annual pace in more than two years in October, with analysts saying that Friday’s data was a harbinger of much worse to come.
Russian companies have started cutting production, jobs and salaries as the global slowdown crimps demand, falling energy and commodity prices eat into profits in the economy’s dominant sectors and the credit crunch makes it virtually impossible to attract funding from abroad.
“October is the first month when we see the hit of the crisis. ... It is the very tip of the iceberg,” said Elina Rybakova, chief Russian economist at Citibank.
“It will get much worse from here.”
Companies reduced capital investment by 1.9 percent in October, the monthly report from the Federal Statistics Service showed.
The jobless rate rose to 6.1 percent with 4.6 million people unemployed — the highest number since March.
Retail sales grew just 12.3 percent in October, their slowest annual pace since May 2006 and undershooting a consensus forecast of 13.8 percent, while housing completions slumped 19 percent during the month.
“It seems that the first reaction in September, when people — faced with concerns about the global crisis and fears of a ruble devaluation — rushed to buy goods, has passed. Now, we are entering a period of slowing sales growth,” said Alexander Morozov, chief economist for Russia and CIS at HSBC.
During October, X5 Group, the country’s top food retailer, said it would lay off up to one-third of its managerial workers, and Renaissance Group announced 100 job cuts.
Magnitogorsk Iron & Steel Works said it is considering shedding 3,000 jobs at the country’s largest steel plant, while truck maker KamAZ shortened its working week.
Job cut announcements have continued in November, with a survey from Levada Center this week showing that 21 percent of respondents or their families have already experienced delays in salary payments and 17 percent are reporting wage cuts.
Data earlier this week showed wage arrears rising to their highest level in a year in October, while annual industrial output growth was revised down to just 0.6 percent, the lowest since mid-2002.
Politicians are waking up to the fact that the country’s natural resource wealth and $450 billion reserves stockpile do not make it invincible in the face of world economic problems.
Analysts say growth prospects for next year hinge on the resilience of the domestic consumer sector, the speed of the global economic recovery and, above all, on the price of oil, which has already fallen below half of the $95 a barrel factored into next year’s budget.
Goldman Sachs forecasts that the Russian economy will grow 6.2 percent this year. Next year, it sees growth of four percent as long as oil averages $85, and stagnation if it averages $50.

TITLE: Gazprom Says Kiev Must Sign Contract
AUTHOR: By Anatoly Medetsky
PUBLISHER: Staff Writer
TEXT: MOSCOW — The risk that Ukraine might see its gas supplies cut off next year re-emerged Saturday as Gazprom warned that time was running out for a bilateral gas contract to be signed. 
Gazprom halted its gas deliveries to Ukraine in 2006, which, in turn, led to a reduction in the supplies that reached Europe. It sends 80 percent of its European exports via Ukraine. 
“We would like to avoid such a development. We would like to agree on everything in the days remaining before the new year, but, as you understand, we cannot supply gas without a contract,” Gazprom spokesman Sergei Kupriyanov said on Vesti-24 television. 
The European Union’s envoy to Russia, Marc Franco, said the bloc remained confident that the countries would find a solution without disrupting transit supplies. 
“I would hope that both partners are wise enough to avoid an open conflict on this. Nobody has any interest in a conflict,” he said, Reuters reported. 
The EU, after its gas inflow slipped in 2006 in the aftermath of Gazprom’s cut to Ukraine, responded with calls to seek more alternatives to deliveries from Russia. 
Shortly after, Moscow decided to build undersea routes to bypass Ukraine and the other transit country, Belarus. Preparations are still going on to start construction on both routes, the Nord Stream in the Baltic Sea and South Stream in the Black Sea. 
Contract negotiations between Gazprom and Ukraine appear to have stumbled on the outstanding gas bills that Ukraine has run up this fall. 
President Dmitry Medvedev, who was previously the chairman of Gazprom’s board of directors, demanded on Thursday that Gazprom recover Ukraine’s debts. 
Ukrainian President Viktor Yushchenko on Friday ordered the government to settle the arrears for gas imports, blaming Prime Minister Yulia Tymoshenko, a former ally turned rival, for the problem. 
Also on Friday, Tymoshenko said she was confident that Ukraine and Russia would sign the supply contract under the conditions set down in the memorandum. This will happen within “the next few weeks,” she said during a visit to Sweden. 
Gazprom chief executive, Alexei Miller, estimated Ukraine’s debt at $2.4 billion, but Ukraine’s national gas company, Naftogaz Ukrainy, said it owed just $1.27 billion. The amount is owed to RosUkrEnergo, the intermediary in the gas trade between Russia and Ukraine, rather than Gazprom, the Ukrainian company said. 
Gazprom owns half of RosUkrEnergo. The other half belongs to Ukrainian businessmen Dmytro Firtash and Ivan Fursin. 
Naftogaz said Friday that it would pay back the debt as soon as possible.

TITLE: Construction of Symbolic Russia Tower Closed Down
AUTHOR: By Yuliya Komleva and Maria Plis
PUBLISHER: Reuters
TEXT: MOSCOW — Construction of the Russia Tower, a 600-meter-tall steel-and-glass symbol of new Russian wealth and power designed by Norman Foster to be Europe’s tallest building, has been halted due to lack of funding, its developer said Friday.
“Say thanks to Alan Greenspan and George Bush,” oil and real estate magnate Shalva Chigirinsky said.
The end of the era of cheap global credit orchestrated by former U.S. Federal Reserve Chairman Alan Greenspan has hit the country’s developers hard, and many have frozen all but a few key projects.
Chigirinsky’s comments appeared to take Foster’s London-based firm by surprise.
“The project isn’t on hold as far as we are concerned,” a spokeswoman said in an e-mailed comment.
Russia’s answer to London’s Canary Wharf or La Defense in Paris, the Russia Tower was to crown Moskva-City, a skyscraper development that rises from an old industrial site surrounded by a highway, a railway and the Moscow River, along with cargo yards and Soviet-era apartment blocks.
Chigirinsky enlisted Foster, architect of the London Swiss Re building popularly known as the Gherkin, as he was garnering a huge following in the former Soviet Union.
Foster + Partners’ web site describes it as the tallest naturally ventilated tower in the world, with 118 occupied floors, and one of the greenest new buildings in Europe. It calls the project an “investigation into the nature of the tall building” like Foster’s Tokyo Millennium Tower.
The foundation stone was laid in 2007, and the tower was due for completion in 2012.
It now shares the fate of the U2 Tower, planned for Dublin’s Docklands as Ireland’s tallest building by a consortium of Foster and the Irish rock band. Negotiations on the U2 Tower were suspended for 12 months because of financial market uncertainty.
The glitzy new Russian commercial district was to give rise to a new international financial center, a dream of President Dmitry Medvedev’s administration.
Earlier this month, one of the anchors of the project, VTB, announced that it would put off its move into the Federation Tower, the second-largest building in the development, to keep costs down.
Mirax, developer of the Federation Tower, which like the Russia Tower is a multiuse building with offices and apartments, said last month that resilient demand for high-end real estate would soak up its $5 million apartments with interiors by Giorgio Armani.
Chigirinsky, born in Georgia and ranked last spring by Forbes among the country’s richest people with a fortune of $1.6 billion, said he could not predict the future of real estate and the resilience of wealthy Russians’ spending power.
“Even if we had funds [to complete the building], we still wouldn’t know what to do with it,” he said.
Foster has designed two more Chigirinsky projects: the Zaryadye cultural, residential and business center to replace the Hotel Rossiya, and New Holland Island, a hotel and entertainment complex on an artificial island in the historic center of St. Petersburg.
Chigirinsky did not give the status of those projects.

TITLE: In Brief
TEXT: <b>Oil Duty Plan</b>
MOSCOW (Reuters) — The State Duma approved a new scheme of calculating oil export duties Friday to help producers curtail losses in a period of rapidly falling crude prices.
The bill says the export duty for oil and refined products will be set monthly, instead of once every two months, and will be based on the average price for Urals crude monitored over a period of one month rather than two. 

<b>Banks Warned </b>
MOSCOW (Bloomberg) — Russian banks that convert government aid into foreign currency rather than lending the government aid to troubled companies may lose access to state funding, First Deputy Prime Minister Igor Shuvalov said. 
The government has prepared a draft law giving the Central Bank additional power to oversee the banks’ spending, Shuvalov said Friday. 

<b>ONGC Prediction</b>
MOSCOW (Bloomberg) — Oil & Natural Gas Corp. said oil would rebound to $100 a barrel, twice the current level, justifying a proposed $2.1 billion bid for Britain’s Imperial Energy by India’s biggest energy explorer. 
Imperial shares have fallen 15 percent below ONGC’s offer price on investor concern that the bid may fail or be lowered. 

<b>Conditions Loosened</b>
MOSCOW (Bloomberg) — Banks with ratings from domestic agencies RusRating and Expert RA can apply for unsecured loans, the Central Bank said Friday, in a move that analysts see as being aimed at boosting the level of liquidity within the banking system. 
Banks with a minimum rating of BB- from RusRating or B++ from Expert RA can apply for funds, the statement said. 

<b>AvtoVAZ Sales Up</b>
MOSCOW (Bloomberg) — AvtoVAZ expects 2008 sales to exceed last year’s, CEO Boris Alyoshin said, Interfax reported. 
The company will complete a plan with Renault SA by the end of this year on the joint production of new models, Alyoshin said. 

<b>KamAZ in Cuba?</b>
MOSCOW (Bloomberg) — KamAZ may build an assembly factory in Cuba as Russia continues to expand economic cooperation with Latin America. 
KamAZ is in talks with Cuban officials about creating a plant that will produce 500 trucks a year, the company said Friday. 

<b>PIK Shuts Unit</b>
MOSCOW (Bloomberg) — PIK Group has suspended operations in the Ukraine because of the global financial crisis, Interfax reported. 
PIK closed its Ukraine office to concentrate on other priorities, said Vladimir Kochetkov-Sukach, deputy director of PIK’s Ukraine unit. 

<b>Gazprom’s Fogaz Stake?</b>
MOSCOW (Bloomberg) — Gazprom is in talks to buy a stake of Budapest’s gas distributor Fogaz, Nepszabadsag newspaper reported, without saying where it got the information. 
The municipality owns 50 percent plus one share in Fogaz with RWE, Germany’s second-largest utility, holding the rest.

TITLE: Platinum Falls on Auto Industry Woes
AUTHOR: By Courtney Weaver
PUBLISHER: Staff Writer
TEXT: MOSCOW — The U.S. and European automobile industries are screeching to a halt, and they’re leaving behind a string of casualties — not all of which are obvious. 
Prices for platinum, which 18th-century French monarch Louis XV is said to have called the only metal fit for a king, have fallen 66 percent from their high in March of $2,276 per ounce to as low as $769 last week. And while coronations have fallen off sharply in recent centuries, weakening demand from carmakers is the culprit behind platinum’s plummet. 
Still popular among jewelers, platinum’s primary use now is as a catalyst in auto exhaust systems, and Russia — the world’s second-largest producer of the metal behind South Africa — shouldn’t expect to see any recovery, at least not in the short term. 
“The fear is that due to an economic slowdown, platinum demand may slow down next year, which could keep prices at a relatively distressed level,” said Mikhail Stiskin, a metals analyst at Troika Dialog. 
There’s hope that platinum prices could return to earlier levels eventually, he said, but a short-term stabilization around current levels is likely. 
On Friday evening, platinum for immediate delivery was trading at $820 on the London Metals Exchange — a fall of 2.3 percent on the week. Nonetheless, it was an improvement from Thursday, when the weekly decline was at more than 7 percent. 
And with carmakers accounting for 60 percent of global consumption, according to metals and chemicals company Johnson Matthey, the rebound may still be a long time coming. 
Last week, the heads of General Motors, Ford Motor and Chrysler personally traveled to Washington to ask Congress for a $25 billion bailout to help them stay afloat. The three companies’ U.S. sales have fallen 21 percent this year, and GM and Ford have lost a combined $30 billion. 
But the CEOs got an angry reaction from some lawmakers after Senator Harry Reid noted that all three arrived on corporate jets, and a decision was put off until the companies provide a more detailed plan of how they would use the money. 
On a brighter note, China’s auto industry is still expected to expand next year, and new environmental regulations in Europe will give platinum an edge in the production of filters that reduce diesel particulate emissions. 
In terms of output, Russia lags behind South Africa, a country responsible for 76 percent of global platinum production. Norilsk Nickel is Russia’s largest producer of the metal.

TITLE: Generators Said To Renege on Building
AUTHOR: By Nadia Popova
PUBLISHER: Staff Writer
TEXT: MOSCOW — The country’s biggest engineering companies said Friday that power producers were backing out of talks to build new generating capacity through 2010 — even at the relatively modest price of $5 billion. 
The estimate comes in sharp contrast to figures given by the power generators themselves. In October, a group of electricity producers sent a letter to the government saying they needed loans of $50 billion to continue building through the financial crisis. They did not specify the length or terms of the financing. 
Engineering firms have faced a difficult market lately, as half the tenders they have won have fizzled out before actual agreements could be signed, Pyotr Bezukladnikov, chief executive of E4 Group, Russia’s biggest engineering company, said in a telephone interview. 
“My company and our peers in the sector calculated the combined sum of our contracts with the generators from the middle of 2009 until the middle of 2010 — it’s only about $5 billion,” Bezukladnikov said. According to his calculations, most generators should have money to build until July 2009. 
“The generators should be modest and just ask for the money to get through the crisis instead of scaring off the state with huge sums,” he said. 
During the power sector privatizations, generators took on a total of 4 trillion rubles ($145 billion) in mandatory investment programs to build new capacity. 
In some cases, generators have simply reneged on contracts, Bezukladnikov complained, and they owe hundreds of millions of rubles for maintenance work. 
E4 had won tenders to build stations for OGK-1 in Perm, OGK-2 in Stavropol and to reconstruct power stations for TGK-11 in Omsk for almost 46 billion rubles ($1.7 billion). All of the generators have had trouble attracting loans in the last two months. 
The National Association of Engineering Companies, whose establishment was announced Friday, said it had sent a letter to the government to ask for a bigger say in solving generators’ problems. 
“Our partners say they can’t commit to the obligations and don’t have the financing needed for the construction because of the crisis — and we have no way to press them,” Bezukladnikov said. 
Vladimir Khlebnikov, chief executive of OGK-1, confirmed that his company was having problems paying engineers and machinery producers. “We simply don’t have money for that now,” he said. “But we are committed to fulfilling the contracts that we signed with them as soon as we get the financing.” 
Bezukladnikov said E4 could halve its investment program next year to $1 billion because of the decrease in orders. “We will vigorously fight for the contracts provided by the state, the only reliable partner in the times of crisis,” he said. 
Sergei Molozhavy, chairman of Tekhnopromexport, Russia’s second-biggest engineering firm, told reporters Friday that he had also pinned his hopes on the government.

TITLE: Central Bank Permits the Ruble To Weaken
AUTHOR: By Catrina Stewart
PUBLISHER: The Associated Press
TEXT: MOSCOW — Russia’s Central Bank said Monday it has allowed the ruble to weaken by widening its trading band against other currencies, the second time it has done so in as many weeks.
A Central Bank spokeswoman said it was a “technical decision” to widen the ruble’s trading band by 30 kopecks. As of 3:20 p.m. (1220 GMT), the ruble was trading at a value of 30.87 against a basket of currencies comprising the dollar and the euro. The Central Bank uses this basket of currencies to establish a value for the ruble that it deems appropriate.
The Central Bank relaxed its tight hold on the currency on Nov. 11, immediately prompting fears that the national currency was heading for a steep devaluation.
The government now appears to be moving toward a managed devaluation, as Russia’s oil-fueled economy battles with falling energy prices and massive outflows of money from the country — putting the ruble under intense pressure.
The ruble was allowed to drop by 1 percent earlier this month and another 1 percent Monday to trade at a value of about 31 against the basket of dollars and euros.
“We expect another few devaluations by year-end, and then a shift to a fully flexible exchange rate, which would imply quite a considerable devaluation at the moment,” said Vladimir Osakovsky, economist at UnicreditAton, part of the Unicredit banking group. “At the moment, the Central Bank has enough reserves to continue its policy, but eventually they will be forced to switch.”
He added that a 1 percent devaluation was “not sufficient” and would feed into further capital flight and speculative attacks.
The government has sought to reassure its citizens in recent weeks that a steep devaluation is not on the cards. But domestic confidence in the ruble remains fragile, with the memory of the 1998 financial collapse — where many Russians saw their savings wiped out almost overnight — fresh in the minds of many.

TITLE: Debt Collectors on the Rise in Modern-Day Russia
AUTHOR: By Olga Kalashnikova
PUBLISHER: Special to The St. Petersburg Times
TEXT: Just a few years ago, the word “collector” in Russian could refer to everything — except debt. Then, in 2006, a new business emerged — debt collection agencies. 
All banks offer loan programs, complete with interest payable, and more and more people have taken out loans in recent years. The money must, however, be paid back, and this is where the debt collection agency comes in. 
Today there are about 100 collection agencies in Russia, but only 10 of them can be considered serious businesses and key players on the market. 
Most clients of debt collectors are banks, telecommunications companies, financial and credit organizations, construction firms and utilities providers.
“Bank and communal services fee debts are not usually that large, it’s a question of thousands and tens of thousands of rubles. Corporate client debts vary from several thousand rubles to tens of millions of dollars,” said Alexander Fyodorov, chairman of the board of directors of USB Center debt collection agency. 
Debts are outsourced to collection agencies in two ways. Either the collection agency makes an agreement with the client and is paid an agreed percent of the sum once it is recovered, or the debt collection agency pays off most of the outstanding sum to the client and then redeems the debt for themselves. Some agencies, including USB, do not acquire debts, but work only for a percentage of the recovered debt.
Nowadays banks and commercial firms are starting to work more with debt collection agencies. 
“Recovering outstanding debts has become more difficult in the crisis due to the decrease in debtors’ solvency. The efficiency of the collection agency is very important right now. Good results can be provided only by professional agencies that are prepared for rapid changes and can maintain the quality of their service, sometimes offering individual conditions for cooperation,” said Dimitrios Somovidis, managing partner at Morgan&Stout collection agency. 
The financial crisis has seen the volume of appeals to debt collection agencies increase — demand tripled during October alone. The deterioration in the economy and the rapid growth of debts in the corporate sphere is causing agencies to focus on corporate debts as well as individual ones.
“Corporate debt recovery with the help of collectors is in demand on the market. Collection agencies work without prepayment but retain a certain percent of the recovered debts. Moreover, recovering the debts takes little time, because the agencies focus on out-of-court settlements,” said Fyodorov.
Specialists predict that a new service will soon emerge — that of running checks on potential clients before loans are issued. 
Yet specialists are not optimistic on the prospects for the main activity of debt collectors — recovery debt owed to banks by individuals. In this respect, the crisis is having a negative impact on the debt collecting business.   
“On the one hand, banks have begun to transfer such debts to collectors far more, on the other hand people’s solvency is going to be lower and they will simply not have the money to pay off their loans,” said Alexei Vasiliev, executive director of USB Center in St. Petersburg.
The debt collecting business in Russia is not a united industry — there are no common goals and principles. The market, however, cannot develop without any legal control.
“It is impossible to advance without defining the rules of the game, instruments and a certain understanding of the result,” said Somovidis.
“On the other hand, the business should not be over-regulated, there is no need for strict limitations, and companies active on the market should not necessarily be monitored. One should always remember that freedom is necessary in order to allow development.”
Charters and guidelines for professional debt collecting agencies do exist, but firms say that this area is not really developed. 
“The collection business project was prepared by a couple of non-commercial organizations that do not have the authority of the legislative initiative. Every organization can prepare such a document,” said Fyodorov.
“To make this project a real law, the authorized person should introduce it to the State Duma. Charters are the internal documents of some collection agencies that are more like recommendations. Moreover, they are often not adhered to by the participants of the associations.”
Collectors have to deal with the government, and the authorities should understand the importance of collectors’ activity, say some specialists.
“The authorities’ support is necessary for the debt collecting business. There are large debt recoveries in the work of the collection agencies and their success depends on the support of government organs for such procedures. This dialog is currently at the stage of conception,” said Yelena Gerasimova, the director of Law Collegium Ltd.
“The present legislation is enough for the normal legal control of the collectors’ activity. It is necessary to simply amend the Civil Code and the law about banks and the banking business,” said Fyodorov.
The collection business in Russia is just beginning to develop, while in the U.S. it emerged 40 years ago. In Europe it became widespread in the ’80s. Despite these differences, the Russian industry can already be compared to foreign ones. 
“The main difference is in the mentality, history and financial competence of people,” said Somovidis.
“That is why the work of debt collection agencies is associated with debt recovery in the criminal ’90s.”
“Most differences relate to the national character of the country — one recalls the reports from foreign countries where the debtor is constantly followed by a man wearing a chicken costume or another fairytale character,” said Fyodorov.
“Our western colleagues are better equipped than most Russian debt collection agencies.”
Foreign agencies are able to redeem debts more frequently. Many analysts predict the appearance of new players on the market, both Russian and foreign.   
“One should not expect a decrease in the price of collectors’ services. In spite of the annually growing competition, the demand on this market is developing rapidly,” said Gerasimova.
“The basis for the work of collection agencies lies in the increasing number of Russian companies declaring bankruptcy.”
The market can be divided by the area of recovery (banks, insurers, state sections), the types of debtors, methods of work (judicial recovery, non-judicial, bankruptcy), and technique (legal methods, psychological, force).
“There will be enough work for everyone. But only those agencies will be the winners that can as satisfy all requirements as to gain in the speed and quality,” said Gerasimova.

TITLE: Crisis Is Reflected in Debt Industry
AUTHOR: By Yekaterina Dranitsyna
PUBLISHER: Special to The St. Petersburg Times
TEXT: As a result of the financial crisis, the volume of outstanding debts is increasing. The outcome of this situation for debt collectors is not however altogether positive. The number of clients is growing, but it is getting increasingly difficult to recover the debts that they are seeking.
“We’ve already felt the effects of the financial crisis. Demand for our services has surged. At the same time, the profitability of our business is decreasing,” said Boris Butyatov, general director of Capital, a local consulting agency specializing in debt recovery.
In November, the number of clients appealing to Capital to recover debts owed to them increased by 60 percent compared to the pre-crisis level. The percentage of debts that Capital was able to recover decreased by 10-15 percent.
“In a crisis, people attempt to quickly recover financial resources tied up in delayed payment agreements and in goods loans. In the near future, we expect the number of applications related to debts to increase, especially in January-February 2009,” Butyatov said.
Another expert agreed. “We are receiving a larger number of applications from all categories of clients — banks, leasing companies, distribution companies, wholesalers and individuals. On the other hand, it’s increasingly difficult to recover debts, because debtors are in a poor financial state,” said Alexander Korolyov, director of FlashCollect agency.
Korolyov estimated that about 50 percent of corporate debts could not be recovered. Before the crisis the situation was quite different.
“With the exception of swindlers, most debtors tried to repay at least some of their debts. Now companies are unable to take out new loans. Sales are decreasing and production volumes are slowing down. Managers were not prepared to take tough action against the crisis in good time — to lay off personnel, reorganize their businesses and negotiate debt restructuring,” Korolyov said.
Butyatov said that Capital recovers 60 percent of debts for individuals and 40-50 percent of debts for private companies.
“For individuals, the percentage of recovered debts is high, but it takes a long time to recover debts. We are currently also seeing the time needed to recover corporate debts increasing,” Butyatov said.
Debt collectors reject blatantly fraudulent cases during prior negotiations with potential clients. The current increase in the volume of unpaid debts is due to the financial crisis.
“Debtors are prisoners of the current situation. Indebted companies planned to repay their debts, but failed to fulfill their liabilities due to inefficient fund management,” Butyatov said.
According to Capital statistics, in November the number of applications from financial companies — leasing companies, banks and credit organizations — increased at the highest pace.
Korolyov said that the volume of outstanding debts is increasing in all industries, not only those that have been hardest hit by the crisis, such as construction and finance. He gave the example of a defense enterprise that did not pay its bills for so long that it was brought to the brink of bankruptcy.
“We expect that demand for debt collection services will keep increasing. Not all creditors have started legal action against debtors yet. Some of them are trying to support their contractors and business partners for as long as possible. But we are already seeing examples in which distribution companies are prepared to ruin their retail chains in order to recover debts,” Korolyov said.
In a state of uncertainty about the future, people have started to complain about unpaid debts as soon as the payment deadline expires.
“Previously, clients complained about one or more problem debts that they had not been able to recover for 2-3 years. In recent months, we have been seeing clients asking us to recover current payable invoices, because they urgently need financial resources to survive in this crisis,” Butyatov said.
Some debt collectors, however, claim that the crisis has not brought about any changes in their routine work.
“So far we have not seen any affects of the financial crisis on our business. We are working as usual. Theoretically, the number of clients should increase, but in reality it is not happening,” said Pavel Borodkin, general director of Baltic Credit Management Agency.
Borodkin recalled only one example in which people made redundant as a result of the crisis asked for legal assistance.
“Recently, one local company fired 150 people. People’s contracts were terminated in violation of existing labor legislation. A few of them joined forces and came to us for a consultation, but I have not heard anything from them since then. They have probably started a legal suit without our assistance,” he said.
“People in Russia are not used to protecting their rights. They rarely unite and act together to stand up for themselves,” Borodkin added.

TITLE: An Expert Guide to Russia’s Debt Collection Legislation
AUTHOR: By Yekaterina Dranitsyna
PUBLISHER: Special to The St. Petersburg Times
TEXT: Unlike the U.S. and many European countries, Russia does not have a law on debt collection. Debt collectors are subject to the general norms of the Civil Code, Criminal Code and other fundamental laws along with special laws that regulate collateral, personal data, credit history, information protection and bankruptcy, said Dmitry Alexandrov, a lawyer at Beiten Burkhardt St. Petersburg.
In Austria, the debt collection law regulates commission size, methods of work and court procedures. In Germany, debt collectors must obtain state certification. In Russia, any private company and individual entrepreneur can act as a debt collector, he said.
“For debt collectors, we recommend safety tips that are standard for any business partner — checking the state registration of a company and its legal and physical address, and investigating the list of founders,” Alexandrov said.
He recommended finding out in advance what methods and resources the agency uses. To obtain references, creditors can apply to professional unions such as the association for the development of the debt collection business.
“If you sell a debt claim to an agency, you should pay attention to the scheme of this deal. If the agency will work for a commission, you should focus on specific terms — the time of the commission payment and how the payment from the debtor will be transferred,” Alexandrov said.
In the U.S., debt collectors charge a commission of 20 percent to 50 percent, he said. “If the agency buys a debt claim, it charges 2-10 percent of the total sum. In Russia such services are more expensive — up to 50 percent of the total debt,” Alexandrov said.
The expert said that in a pre-trial period, very few legal methods are effective. “Debt collectors try to find out what caused the debtor to get into arrears. They mail and call the debtor, meet with them personally, ” he said.
Filing a legal suit is the next step. “In this period legal actions are taken to ensure debt payment — including property confiscation and the limitation of legal capacities to prevent debtors from undesirable action,” Alexandrov said.
He said that publicizing the legal suit and informing financial institutions, the debtor’s partners and colleagues about his insolvency could be very effective. However, when using these methods, it is important not to overstep the degree allowed by the law.
“A criminal suit for fraud, illegal borrowing or debt evasion is the final option,” Alexandrov said.
Among illegal methods or debt recovery, Alexandrov listed blackmail and making threats against the debtor, his relatives and property. Debt collectors often use their ties with the authorities to start an investigation or bankruptcy procedure to prevent the indebted company from operating normally and gain control over it, Alexandrov said.
“In response to that, anti-collection agencies have appeared that advise debtors on how to evade debt payment, which is obviously an illegal activity,” he said.
In the absence of a law on debt collection, professional unions have produced ethical codes to regulate this business.
The Professional Debt Collection Agencies Charter appeared in May 2008, and offers guidelines and advice on techniques and behavior appropriate to the debt collection business.

TITLE: Resisting Temptation: Avoiding Falling Into Debt
AUTHOR: By Olga Kalashnikova
PUBLISHER: Special to The St. Petersburg Times
TEXT: Obtaining a loan in contemporary Russia is no longer a difficult process. Everyone, regardless of their income, can make a credit arrangement with a bank or store. Credit schemes are widely used when buying cars, TVs, washing machines and other expensive purchases. Almost everything can be bought on credit nowadays. Many people, however, do not realize that free cheese can only be found in a mousetrap. Every loan must be paid back, and the total is always much higher than the cost of the item. When people fall behind with payments, debt recovery consultants come knocking.
To avoid getting into personal debt, people should be very careful when making the decision to take out a loan, and should research several banks first of all. 
“One has to understand that the loan repayments should not be more than 25 percent of the person’s income. Otherwise, there is a high chance that they will fail to meet the schedule of the payments,” said Alexei Vasiliev, executive director of USB Center in St. Petersburg.
Anyone can insure themselves against getting into bad debt. It is not easy to pinpoint specific categories of debtors.
“Nowadays, debtors are often people working in spheres where there is a risk of job losses due to the financial crisis,” said Oleg Kogan, director of outstanding debt recovery at Alfa-Bank. 
“In most cases, these are people whose personal financial situation is not stable or high-income, or who lose their income. People who suddenly incur losses due to unexpected circumstances can also end up in debt.”
“Bad debts are the result of personal lack of discipline, when the debtor miscalculated his financial capacity. Sometimes, people take out loans for the organization where they work or for another person, who is not then able to pay off the debt,” said Sergei Titov, director of outstanding debt collection for the Northwest at Alfa-Bank.
When people realize that they cannot repay their debt, they often try to conceal this from the bank. At first, they think that the bank may forget about the debt. But this is of course an illusion. When the repayment deadline is up, the debts can multiply with every passing day, and the sum gets bigger and bigger. At first, banks try to deal with the client themselves — they telephone them and send emails and even text messages to them. If the person does not respond, companies often appeal to debt collection agencies.
“It has become a generally accepted practice. Nowadays, nearly all large banks work with collection agencies in one form or another,” said Kogan. “The rate of remuneration is variable.”
The services of debt collection agencies are often used in regions where there are no bank representatives.
The work of the debt collector consists of several stages: “soft” collection (telephone calls, emails and text messages), “hard collection” (a personal appeal to the debtor), then the agencies gather information about the debtor and take the final step — “legal collection” — when the case goes to court. 
To avoid such measures being taken, debtors should not remain passive if they realize they cannot pay off the debt. There are various ways to solve the problem. One should be honest with the bank, and offer ways to pay off the debt. 
“People should realize that as soon as they have outstanding debts, their economics stop being their private business. The bank must have access to all the information about income and expenditure and the debtor’s plans,” said Kogan.
Only by following these recommendations can the client hope for an understanding and loyal attitude from the bank. The debtor alone is responsible for their problem, and the worst thing the debtor can do is to avoid contact with bank employees.
“The first thing to do is to come to the bank and make a statement explaining the reasons for requiring debt restructuring. The person can also get out a loan at another bank or sell their property to clear a debt,” said Titov.
“One can borrow money from friends to pay off a debt, or rent out property.”
When taking out a loan, experts emphasize that people should assess their financial capabilities carefully. 
“People should think a lot about buying something on credit. They should not yield to the temptation of buying anything they like,” said Vasiliev.

TITLE: Debt Experts Suggest: ‘Check First, Then Trust.’
AUTHOR: By Boris Kamchev
PUBLISHER: Special to The St. Petersburg Times
TEXT: As a consequence of the ongoing liquidity crisis, Russian companies are slashing investment plans and cutting jobs, but those with fewer liquidity options are entering a vicious circle of debt and becoming a target for debt collecting agencies.
“We are not collectors, we are mediators” is the motto of the Moscow Alpha business anti-crisis center, which appeals directly to debtors or contractors struggling to repay their debts.
In a country that has only tried to develop a free economy during the last two decades, every Russian debt is a potential source of conflict.
Urcollegia, a law firm specializing in debt collection, has published ten basic rules to help companies avoid potential debtors, and to find debtors and return the money or property they owe. 
“Most debts are due to the existence of so-called fly-by-night companies used by swindlers,” said Yelena Gerasimova, director of Urcollegia and author of the ten basic rules, which are posted on the agency’s web site. The advice includes conducting a careful background check of every partner company. 
The basic rule is “check first, then trust.” This advice is given against the background of numerous current conflicts in off-plan residential property developments. 
Another rule is to draw up comprehensive documents and agreements. It is strongly recommended that partners do not make verbal agreements. If additional services are required after the contract has been signed, Urcollegia recommends drawing up an additional signed agreement for this service.    
Although the activities of debt collecting agencies may appear exclusively commercial, the business also has a social aspect to it. The current financial crisis will spill over into housing and communal services (HCS) enterprises as well, so debt collecting agencies often find clients in these communal enterprises. But the problem here is unique, as HCS enterprises are remnants of the Soviet planned economy and are not commercial companies, As such, they cannot refuse to supply communal services (electricity, heating and water supply) to consumers, even if they are a year or more behind with their payments. Their only option is to complain to the water or electricity providers, who can turn off the taps or cut off the power supply. Alternatively, they can seek help from debt collecting agencies, which is a more expensive option. 
It is not only Russian companies or individuals who are faced with the non-payment of debts. It is also a problem for international companies and businessmen working with the Russian state.  
In the 1990s, when Russia was among the poorest debtor countries and facing an economic meltdown, Yeltsin had to make major concessions to the West, especially when the deadlines for interest payments were looming. His successor, former president-turned Prime Minister Vladimir Putin, was faced with the consequences of his predecessor’s liberal ties with the West several years ago. A Swiss businessman owed money by Russia tried to impound Putin’s private jet, several valuable works of art, Russian planes at an air show and a historic Russian ship at a regatta.
His efforts ultimately failed, but creditors remain vigilant — and so do the debt collecting agencies.

TITLE: A T-Bond Bubble Waiting to Burst
AUTHOR: By Alexei Bayer
TEXT: Remember when the Dow Jones industrial average touched 14,000 a year ago? When gold reached $1,000 per troy ounce in May, and Moscow’s RTS market index was trading above 2,500? Or when a barrel of oil cost $147 in July? 
When the bubble in the U.S. housing market deflated in mid-2007, a massive wave of money began sloshing around the world, quickly inflating and then bursting a series of speculative bubbles in various markets.
Now it is up to the final bubble — the U.S. government debt bubble. Treasury bond yields have been falling steadily over the past year and a half as investors looked for safety amid collapsing markets and economic uncertainty — the yield on the 10-year Treasury bond fell from more than 5 percent to 3 percent. Falling yields mean that bond prices have skyrocketed; the price of the 30-year T-bond is at a record high. 
But T-bonds may no longer offer the traditional safety on which investors have usually counted. On the contrary, bond prices may plunge just as spectacularly as house prices, commodity prices and stock prices have in recent months. What’s remarkable is that Russia may end up playing a key role in the deflation of the U.S. government debt market.
True, Russia has a small economy, accounting for no more than 3 percent of global gross domestic product, and its financial markets are no match for the world’s financial hubs. It is a major player in only two areas — commodities and natural resources. Nevertheless, Russia nearly dragged down the global financial system when it suffered a debt default in 1998 and it may do so again now.
Although the Central Bank’s gold and foreign currency reserves have decreased from their August high of $600 billion, they are still the world’s third-largest at $484 billion. Over the past decade, the Russian government has been one of the world’s most important buyers of dollar-denominated securities. According to U.S. Treasury Department data, Russia bought about $65 billion worth of T-bonds since the start of 2007, but sold about $5 billion in September alone. 
Overall, Central Bank reserves shrank by $122 billion by early November — mainly to fund the bailout programs and to support the ruble. This suggests that the government sold even more Treasury securities over the past six weeks to come up with the cash. 
Moreover, the holdings — and sales — of T-bonds by Russian official entities and private investors have been underestimated, because many Russian companies and wealthy individuals hold their assets in Luxembourg, the Caribbean and other offshore centers. Russia has been hit by the current financial crisis harder than most other emerging economies, which means that the liquidation of its U.S. Treasury holdings will continue and may even accelerate in coming months.
This may be the start of a global avalanche, since other central banks have been drawing down their reserves as well, albeit by smaller amounts. Further down the road looms China’s $586 billion fiscal stimulus package, which will be financed by the liquidation of U.S. Treasury securities held by the country’s government and central bank.
Even as world central banks stop buying U.S. T-bonds and start selling them, demand for funds in Washington is escalating. The federal budget deficit reached a record $237 billion in October alone. At the end of fiscal year 2008, which began Oct. 1, it will have widened to at least $1 trillion. Washington will need to raise $1.5 trillion in the current year, according to U.S. Treasury Secretary Henry Paulson. It is safe to assume that Paulson’s estimate is a conservative one.
Driven by rising supply and falling demand, yields on U.S. government bonds may spike. This will cause interest payments, which currently measure some $450 billion per year, to skyrocket. The worst-case scenario would be if the United States finds that it can’t borrow what it needs at any price — the same situation many consumers and companies already face in the current credit crunch.
Unlike private borrowers, however, the government has a solution. It can simply print money to meet its financial obligations. 
This is an old trick. The printing press is the last resort of any government that discovers it can no longer raise money from lenders or taxpayers. It was used by the German government after World War I and, more recently, by such debtor nations as Argentina and Brazil. Printing vast quantities of money inevitably produces higher inflation. But, on the other hand, inflation has the advantage of reducing the real value of debt and, in countries with a progressive taxation system, of boosting government revenues because it pushes more taxpayers into higher income brackets.
Since the dollar is a reserve currency, the problem with printing dollars is that the subsequent inflation will be instantly transmitted abroad. For example, at the start of this decade no nation could escape a liquidity bubble once the U.S. Federal Reserve began pumping dollars into the world financial system. If Washington starts printing extra dollars, foreign central banks will either be forced to revalue their currencies sharply against the greenback — and thus worsen the already nasty recession at home — or issue more domestic currency to match the depreciating dollar. 
For now, most economic forecasters around the world still expect falling prices next year. Consumer prices in the United States fell by a dramatic 1 percent in October. But this will change quickly if the Treasury bubble bursts and the U.S. government is forced to start up the dollar printing presses.
Russia, as usual, has the most to fear from this turn of events. Russia has not been able to defeat inflation this decade, when inflationary pressures elsewhere in the world were benign. Its consumer prices continued to rise at double-digit rates for most of the period. The World Bank sees inflation increasing to as high as 14 percent next year.
The current crisis has shown that the negative developments in the world financial market affect Russia sooner — and harder — than most other emerging economies. If the United States suffers a bout of high inflation, Russia — and its long-suffering savers — may face something similar to the hyperinflation the country experienced in the early 1990s.

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

TITLE: A Hard Sell
AUTHOR: By Anna Shcherbakova
TEXT: Having previously worked as an anthropologist, the Frenchman Clotaire Rapalle has transformed himself into an American marketing guru. He advises major companies such as Chrysler, Ritz-Carlton and Nestle. Clients pay up to $200,000 for his services, which help them to discover what customers really want. Because, according to Rapalle, people usually only say what they are expected to say, he searches beyond their words to look for their unspoken needs, which are derived from their reptilian brains, or “cultural unconscious.” His “imprinting sessions” are closer to psychoanalysis, involving total relaxation and deep layers of association, than traditional focus groups. After three hours of relaxation he might ask, “What do you do with coffee?” or some other seemingly absurd question in order to get through to the hidden code.  
According to Rapalle, once you understand the code, you understand why people do what they do. This knowledge helps companies to sell their products and prevents them from making marketing mistakes. For example, the code for America, a young, adolescent country, is “to do,” while for the French it is “to think.” 
“We work hard because we have to make it, to prove who we are; we are in a permanent search for identity. That’s very American. [...] You can only discover who you are when you try. And you have to try and try and never give up,” Rapelle said in an interview. 
Rapalle’s theory is described in his book Culture Code, in which the author widely quotes his respondents and tells stories about his successful clients. 
Rapalle’s book was recently published in Russian. It’s an exciting excursion into the American mind where “house,” for example, means “return” or “reconnection.” According to him, the American code for being overweight is “a checking out of the game” and for beauty it is “man’s salvation.” Obviously it is very different in Russia, where the code, according to Rapalle, combines elements of Tsarist structures and deeply seated religious beliefs. But it makes the book no less useful. 
I’m sure Russian marketing people will like the methodology. It looks fairly simple and does not give any concrete, quantitative results, which is good news for homemade marketers. No figures means no responsibility. Even without a three-hour-long deep analysis session, I can risk making the assumption that the code for marketing is to cheat either the consumer or the employer. 
Times are pretty tough for marketing people at the moment. Increasingly, marketing looks like a function of a prosperous, abundant market. However, many companies should now be competing for financial resources rather than for consumers. The prosperity of previous years is over; huge marketing budgets are being cut and managers fired. The best ones will stay on in an industry that will change its profile during the financial crisis. Some of them could describe the Russian code for car or alcohol or jewelry, but the audience for those revelations seems to be very small at the moment — too many companies are having too many problems surviving. Nevertheless, those who are pioneers in using the culture code could prove more successful in the world as it recovers from the financial meltdown. So, now is a good time to slow down and learn more about Rapalle’s method. 

Anna Shcherbakova is the St. Petersburg bureau head of the business daily Vedomosti.

TITLE: Davis Cup Caps Spain’s Sensational Year
AUTHOR: By Paul Logothetis
PUBLISHER: The Associated Press
TEXT: MADRID, Spain — Spain clinched an improbable, come-from-behind Davis Cup victory over Argentina on Sunday to cap a historic year of Spanish sporting achievement.
Fernando Verdasco won 6-3, 6-7 (3), 4-6, 6-3, 6-1 against Jose Acasuso at Mar del Plata as Spain rallied from one point down for its third Davis Cup title against the overwhelming favorites, despite losing top-ranked Rafael Nadal to injury before the final.
“These are unforgettable moments,” Nadal, winner of a fourth straight French Open trophy and his first Wimbledon title earlier this year, told Spanish state television.
“We need to stress that they’ve made history. It’s an unforgettable victory. I don’t think it’s possible to be any happier.”
The 22-year-old Nadal, who dethroned Roger Federer from the No. 1 ranking after a record 237 weeks at the top, also won Olympic gold before helping Spain reach the Davis Cup final with an emphatic 4-1 victory over the United States in the semifinal.
A knee injury left Nadal to enjoy the final on TV from his home on Mallorca.
Away from the tennis court, Spain ended a 44-year drought without a major soccer trophy in June by triumphing at the European Championship.
That 1-0 victory over Germany saw Spain shake off its perennial underachiever tag and surge to the top of FIFA’s world rankings. It also tops its World Cup qualifying group with a perfect record and is looking like one of the favorites for the 2010 World Cup, having not lost an international match in more than two years.
“What can I say? We’ve had a sensational year in Spain,” Real Madrid and national team goalkeeper Iker Casillas said.
Although 2007 Tour de France champion Alberto Contador didn’t get the chance to defend his crown after switching to the Astana team, nevertheless, another Spaniard succeeded him as Carlos Sastre won cycling’s premier event in July.
Still, Contador did manage to become only the fifth cyclist to sweep all three of cycling’s major events after winning the Giro d’Italia and the Spanish Vuelta, a feat he accomplished faster than anyone else after taking all three titles within 15 months.
At the Beijing Games, Spain produced its third-best medal haul—18 total— and is confident that its recent sporting successes will strengthen a bid to bring the 2016 Olympics to Madrid.
Even two-time Formula One champion Fernando Alonso has given Spanish auto racing fans hope that he can fight for the title in 2009, after winning two races at the close of his first season since returning to Renault.
“Before the death of [Spanish dictator General Francisco] Franco [in 1977], we were a poor country, a poorly run country,” Santiago Segurola, the dean of the country’s sports writers, told The Associated Press in an interview earlier this year. “Now, there is no country that matches Spain for champions.”

TITLE: Obama Names New Team to Tackle Crisis
PUBLISHER: The Associated Press
TEXT: CHICAGO, Illinois — Eager to calm economic anxieties, President-elect Barack Obama is rolling out an economic vision that will require congressional cooperation even before he settles into his new desk in the White House’s Oval Office.
Obama was due to introduce his new economic leadership team Monday, a key step toward enacting a huge new economic recovery plan that aims to save or create 2.5 million jobs over the next two years.
The plan is likely to far exceed the $175 billion Obama proposed during the campaign. It would include an infusion of money for infrastructure projects, new environmental technologies and tax cuts for low- and middle-income taxpayers. It will not call for tax hikes for the wealthy.
Obama aides on Sunday called on the new Congress to pass legislation by the Jan. 20 inauguration that meets Obama’s two-year goal of saving or creating 2.5 million jobs. Democratic congressional leaders said they would get to work when Congress convenes Jan. 6 with bigger Democratic majorities in the House and Senate.
With the wounded economy worsening, the Obama team’s new assertiveness was a recognition he needed to soothe financial markets with signs of leadership. It also foreshadowed a more hands-on role by Obama to influence congressional action during the final weeks of the transition.
Heading his economic team will be Timothy Geithner as Treasury Secretary and Lawrence Summers as head of the National Economic Council. Obama also has settled on New Mexico Governor Bill Richardson as his Commerce Secretary.
“We don’t have time to waste here,” Obama senior adviser David Axelrod said. “We want to hit the ground running on January 20.”
Echoing that, the second-ranking House Democrat, Representative Steny Hoyer of Maryland, said “We expect to have during the first couple of weeks of January a package for the president’s consideration when he takes office.”
While Obama and his team are focused on the work of the new Congress, they also weighed in work pending before the current one.
Axelrod warned automakers seeking billions in government help to stave off collapse to devise a plan to retool and restructure that they can present to Congress next month. Otherwise, he said, “there is very little taxpayers can do to help them.”
The emphasis on the economy began Saturday when Obama outlined the framework to save or create 2.5 million jobs by the end of 2010. The scope of the recovery package is far more ambitious than Obama had spelled out during his presidential campaign, when he proposed $175 billion of spending and tax-cutting stimulus. The new plan will be significantly larger and incorporate his campaign ideas for new jobs in environmentally friendly technologies — the “green economy.” It also would include his proposals for tax relief for middle- and lower-income workers.
But there were no plans to balance the tax cuts with an immediate tax increase on the wealthy. During the campaign, Obama said he would pay for increased tax relief by raising taxes on people making more than $250,000.
“There won’t be any tax increases in the January package,” said one Obama aide, who spoke on condition of anonymity because the details of the Obama package have not been fleshed out.

TITLE: Shippers Call For Somalia Blockade
PUBLISHER: The Associated Press
TEXT: KUALA LUMPUR, Malaysia — Shipping officials from around the world called for a military blockade Monday along the coast of Somalia to intercept pirate vessels heading out to sea.
Peter Swift, managing director of the International Association of Independent Tanker Owners, said stronger naval action — including aerial and aviation support — is necessary to battle rampant piracy in the Gulf of Aden near Somalia.
Some 20 tankers sail through the sea lane daily but many tanker owners are considering a massive detour around southern Africa to avoid pirates, which will delay delivery and push cost up by 30 percent, he said.
The association, whose members own 2,900 tankers or 75 percent of the world’s fleet, opposes attempts to arm merchant ships because it could escalate the violence and put crew members at risk, he said.
“The other option is perhaps putting a blockade around Somalia and introducing the idea of intercepting vessels leaving Somalia rather than to try to protect the whole of the Gulf of Aden,” said Swift.
A blockade along Somalia’s 2,400 mile coastline would not be easy, Swift said. “But some intervention there may be effective,” he told reporters on the sidelines of a shipping conference here.
US General John Craddock, NATO’s supreme allied commander, said Monday that the alliance’s mandate is solely to escort World Food Program ships to Somalia and to conduct anti-piracy patrols.
Asked what he thought of a Russian proposal to jointly attack the pirate strongholds, Craddock answered: “That’s far beyond what I’ve been tasked to do.”
NATO has four warships on duty off the coast of Somalia, an impoverished nation caught up in an Islamic insurgency that has had no functioning government since 1991. The US 5th Fleet based in Bahrain also contributes to policing the coast, along with frigates from Russia, India, Malaysia and Denmark.
But the navies say it is virtually impossible to patrol the vast sea around the gulf.
Somali pirates have become increasingly brazen, seizing eight vessels in the past two weeks, including a huge Saudi supertanker loaded with $100 million worth of crude oil.
There have been 95 pirate attacks so far this year in Somali waters, with 39 ships hijacked. Fifteen ships with nearly 300 crew are still in the hands of Somali pirates, who dock the hijacked vessels near the eastern and southern coast as they negotiate for ransom.
“Any action to prevent the pirates from heading out to sea is welcome,” said Noel Choong, who heads the International Maritime Bureau’s piracy reporting center in Kuala Lumpur. He said it was up to the international community to decide how they can deploy their forces for the blockade.
The Baltic and International Maritime Council, the world’s largest private shipping organization, echoed calls for greater military action.
“Despite increased patrols by coalition forces, piracy attacks continue.” said Thomas Timlen, the Council’s Asian liaison officer.

TITLE: FC Zenit Have To Beat Juve
AUTHOR: By Gennady Fyodorov
PUBLISHER: Reuters
TEXT: MOSCOW — Zenit St Petersburg face the monumental task of beating Juventus on Tuesday and Real Madrid in their final Group H match to reach the Champions League knockout stage.
The Russians, third in the group six points behind leaders Juventus and two adrift of Real Madrid, must beat the Italians at home and the Spanish champions in Madrid on Dec. 10 to join Juve in the last 16.
Zenit beat Spartak Moscow 3-1 on Saturday but by finishing fifth in the Russian league they are outside the Champions League places for next season.
“Obviously, finishing fifth is a big disappointment for both the club and our fans,” said their Dutch coach Dick Advocaat, who steered Zenit to their first Russian title in almost a quarter of a century last year and UEFA Cup victory in May.
 “It has been a very long a tough season. Now we have only two games left and we want to end the year on a high note.”
Zenit have a full squad available for Tuesday except for French defender Sebastien Puygrenier, who is serving a one-match ban after being sent off against BATE Borisov three weeks ago.
Russia playmaker Andrei Arshavin has an added incentive to excel against Juventus and Real after demanding a move away from St Petersburg in the off season.
Juventus, who reached the last 16 after winning 2-0 at Real Madrid last time out, lost 1-0 at Serie A leaders Inter Milan on Saturday.
Claudio Ranieri’s side barely had a shot at goal as a run of seven straight wins in all competitions came to an end.
“We wanted to win to keep the title race tight but it doesn’t change our objectives. We want to improve on the third place we managed last season in the championship and go as far as possible in Champions League,” Ranieri told reporters.
Juve lost Tiago to a knee injury in the fourth minute and the Portuguese midfielder is now highly doubtful and Dane Christian Poulsen is also struggling for fitness.
Ranieri is expected to rest some players but finishing top of the group remains an aim.
Alessandro Del Piero, 34, scored both goals against Real but has netted just once since and could be given a break, in which case Vincenzo Iaquinta will come into the side.
Goalkeeper Gianluigi Buffon remains sidelined with a leg injury.

TITLE: Thai Protesters Stage ‘Final Showdown’ Against Government
PUBLISHER: The Associated Press
TEXT: BANGKOK, Thailand — Thousands of anti-government protesters took to the streets of Thai capital Bangkok on Monday, forcing Parliament to shut down in what activists called their “final showdown” to oust an allegedly corrupt administration.
Parliament postponed a joint session of both houses after protesters surrounded its gates and reportedly cut electricity to the building. House Speaker Chai Chidchob said the session would be rescheduled “when the situation returns to normal.”
Despite fiery declarations that Monday’s action would be their “longest day,” a leader of the anti-government group — which calls itself the People’s Alliance for Democracy — told followers to step up their protest efforts Tuesday.
“Tomorrow is going to be more intense,” Chamlong Srimuang said to supporters at the group’s stronghold at the prime minister’s office, which it has occupied since late August. “We request that you sleep well tonight to save your energy.”
Political tensions have been simmering since 2006, when a similar protest campaign against then-Prime Minister Thaksin Shinawatra led to him being deposed by a military coup. They heated up with the current effort to force Prime Minister Somchai Wongsawat to step down. The protesters accuse him of acting as a proxy for Thaksin, his brother-in-law.
The state planning agency said Monday that Thailand’s economy grew at its slowest pace in more than three years, taking a double hit in the third quarter from the political turmoil and the global financial crisis.
“Major service sectors such as manufacturing, hotels and restaurants, transport and communications, and wholesale and retail trade” showed slowed growth, said a report by the National Economic & Social Development Board.
Riot police early Monday had barricaded Parliament with metal barriers and stood guard inside the compound.
Protest leaders say their goal is to block the government from functioning. The demonstrators called the protest to block Parliament from debating constitutional amendments that they say would help Thaksin stage a comeback.
“This is the final showdown,” protest leader Somsak Kosaisuk told the crowd, adding that “they have robbed the country to the point where we can’t take it anymore. I promise you this will soon end.”
Music blared through loudspeakers as protesters sang and danced on the streets outside, many with swimming goggles protectively on their foreheads in case police moved in with tear gas.
Both sides had feared violence would erupt. Protesters were flanked by their own guards armed with poles, clubs and metal rods.
The last time the group marched on Parliament, police efforts to disperse them with tear gas resulted in running street battles. Two people were killed and hundreds injured in the Oct. 7 violence.
On Monday, riot police carrying shields and batons yielded whenever protesters pushed hard.

TITLE: Hatton Grinds Down Malignaggi, Fight Stopped in Round 11
PUBLISHER: The Associated Press
TEXT: LAS VEGAS — Turns out Ricky Hatton didn’t need to change much to take care of Paulie Malignaggi.
Looking much like the fighter he’s always been, Hatton dominated the fight from the second round on Saturday night before Malignaggi’s trainer stepped into the ring 28 seconds into the 11th round to spare his fighter any further damage.
Fighting in the same ring where he suffered his only loss against Floyd Mayweather Jr. a year ago, Hatton stunned Malignaggi early and dominated him the rest of the way in a fight that was never really in doubt. In winning easily, he staked his claim once again as the best 140-pounder in the world.
Hatton brought in Mayweather’s father, Floyd Sr., to help him with his defensive techniques for the fight, but he didn’t need much defense against the light-hitting Malignaggi, who could never find an answer to Hatton’s all-out fighting style.
Hatton had won nine out of the previous 10 rounds on all three ringside scorecards when the fight was finally stopped. Though Hatton never managed to put Malignaggi down, he hurt him several times during the fight.
“I enjoyed it this time better than I did last time—that’s for sure,” Hatton said. “Nobody will beat me at junior welterweight—nobody.”
Malignaggi never seemed the same after the second round when Hatton hit him with a right hand that buckled his legs and forced him to hold on to survive the last 30 seconds of the round. From then on it was all Hatton, much to the delight of several thousand British fans who cheered and sang their countryman’s praises from the opening bell on.
Malignaggi’s face was bruised and his eyes puffy midway through the fight as Hatton’s punches began showing their effect. By the eighth round, Hatton was chasing Malignaggi and taking wild swings at him, clearly unimpressed with the power of a fighter who had only five knockouts in his 26 professional fights.
Hatton, though, said it was harder than it looked.
“I was getting frustrated during the fight because Paulie was a lot tougher fighter than you would think,” Hatton said.
At the end of the 10th round, trainer Buddy McGirt warned Malignaggi that he would stop the fight if he continued to take a beating, and it didn’t take long for him to follow through on his promise. McGirt came into the ring and the fight was stopped, much to the displeasure of Malignaggi, who shoved his trainer away when he tried to embrace him.
“I was worse off in the Miguel Cotto fight,” Malignaggi said of his only previous loss. “They didn’t stop it then, they shouldn’t have stopped it now.”
McGirt was unapologetic
“My guy was hurting and I wanted him to live to fight another day,” he said. “I would rather have him mad at me stopping the fight than let him get hurt and never fight again.”
Malignaggi had mocked Hatton’s effort to bring in a new trainer to improve his defenses, saying Hatton would revert to his old ways the moment he got hit in the mouth. But while Malignaggi didn’t do much hitting, Hatton fought the same style he has always fought in improving his career record to 45-1.
It didn’t matter much as Malignaggi couldn’t figure out a way to use his boxing ability to keep Hatton on the outside and win points with his jab.
“I just couldn’t get to him,” Malignaggi said. “I couldn’t hit him.”
Ringside punching stats showed Hatton landing 99 of 377 power punches to just 25 of 133 for Malignaggi, a New York native who lost for the second time in 27 fights.
Hatton was a 2-1 favorite in the sports book in his second fight back at junior welterweight after moving up to 147 pounds for his bout with Mayweather.
Unlike his last fight here a year ago that drew a raucous sellout crowd to the MGM Grand, the arena was far short of a sellout for a fight that had little buzz despite matching arguably the best two 140-pounders in the world. Hatton earned $2.5 million for his night’s work, while Malignaggi was paid $1 million, the biggest purse of his career.

TITLE: Citigroup’s Survival Seen as Crucial in Key Asian Markets
PUBLISHER: The Associated Press
TEXT: HONG KONG — Asia breathed a little easier after the U.S. government cast a lifeline to Citigroup Incorporated, averting what many believed would have been a catastrophe for the global financial system.
Yet shares of financial companies dropped across the region as the bailout, widely expected by investors given Citigroup’s size and scope, highlighted persistent worries about the problems facing the banking sector.
Washington unveiled plans late Sunday to take a $20 billion stake in the banking giant and guarantee the hundreds of billions of dollars in risky debt it had gorged on, humbling yet another once-swaggering Wall Street icon.
Critics said the bailout creates a moral hazard that will eventually backfire because it effectively rewards the bank for taking unacceptable business risks.
“This challenges the existing rules in the industry and might affect the fairness of competition,” said Yu Xiaoyi, chief researcher for Guangfa Securities, in the Chinese southern city of Guangzhou. “This should be a lesson for China’s own banks about risk controls.”
But many welcomed the deal as saving the global financial system, already stricken by the year-old credit crunch that originated from a mountain of toxic mortgages in the U.S., from further mayhem.
“If they didn’t help, the damage would be beyond imagination,” said Teck-Kin Suan, economist at United Overseas Bank in Singapore. “The scale is so much larger than Lehman Brothers,” the legendary Wall Street investment bank that filed for Chapter 11 bankruptcy protection in September after the U.S. government refused to rescue it.
The Citigroup rescue was designed to stem a crisis of confidence that deepened last week as the company’s shares plunged 60 percent on worries about its financial health.
A sprawling firm with operations in more than 100 countries and over $2 trillion in assets, Citigroup is among the biggest players in the world’s financial system.