SOURCE: The St. Petersburg Times
DATE: Issue #1444 (6), Friday, January 30, 2009
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TITLE: Plunging Ruble Nears Low Set In 1998 Crash
AUTHOR: By Emma O’Brien
PUBLISHER: Bloomberg
TEXT: The ruble had its biggest two-day drop in a decade against the dollar on Thursday, less than a week after Prime Minister Vladimir Putin defended Russia’s policy of devaluing the currency “gradually and carefully.”
The ruble fell to 34.9835 per dollar, the weakest since January 1998, bringing the two-day decline to 5.6 percent, after the central bank said foreign-exchange reserves fell $9.7 billion last week to $386.5 billion. The currency is approaching the 36 per dollar level that the central bank pledged to defend.
“The government found out that it couldn’t dictate to the market what to do,” George Nianias, chairman of Denholm Hall Management Ltd., a hedge fund with about $350 million invested in emerging markets, said in an interview in Moscow. “Every time you put a target on something in a weak market it’s going to be tested, it is an invitation to test it.”
Putin said in an interview with Bloomberg Television four days ago that Russia set itself apart from other countries by using reserves so as not to “crush the national currency overnight,” avoiding a repeat of the 1998 crisis when the currency fell as much as 29 percent in a day. The ruble fell 3 percent against the dollar on Thursday, bringing the five-month decline to 33 percent.
The ruble is sliding as the falling price of oil, Russia’s chief export earner, and the worst financial crisis since the Great Depression drives capital away from Russia. Investors withdrew at least $278 billion since August, according to BNP Paribas SA data.
Urals crude, Russia’s main export blend, slumped 69 percent from a July record to $43.58 a barrel, below the average of $70 needed to balance the nation’s current 2009 budget. The decline in commodities will send Russia, the world’s largest energy exporter, into recession this year, with the government forecasting the economy will contract 0.2 percent.
Most Russian companies will find it “practically impossible” to raise money abroad for at least six months, VTB Group Chief Executive Officer Andrei Kostin said in an interview in Davos, Switzerland, Thursday.
The central bank widened its target trading band for the ruble 20 times since Nov. 11 and drained more than a third of its reserves, before switching last week to let “market” forces help determine the exchange rate. The widened band allows the ruble to fall to 41 against a basket of about 55 percent dollars and the rest euros. Oil at $30 a barrel could test new exchange-rate level, Bank Rossii said at the time.
The central bank’s target will be “very quickly” breached without more intervention to support the currency, said Gaelle Blanchard at Societe Generale SA in London.
“Right now the market is convinced it wants to see the ruble lower,” Blanchard said in an interview. “As long as the central bank gives these targets then speculators are going to have something to aim for.”
Whether the ruble breaks its new trading band depends on the oil price and the central bank’s willingness to spend more reserves, said Nianias at Denholm Hall.
Russia spent a record $11 billion in just one day last week to support the exchange rate, according to Moscow’s Trust Investment Bank data for Jan. 19.
Since announcing the new wider trading range on Jan. 22, the central bank has avoided intervening, Alexei Moisseev, head of fixed income at Moscow investment bank Renaissance Capital, said yesterday. The currency has lost 7.3 percent since the announcement.
The ruble slipped as much as 2.3 percent Thursday to 45.6615 per euro.
TITLE: Putin Gives Words of Warning in Davos
AUTHOR: By Anatoly Medetsky and Nadia Popova
PUBLISHER: The St. Petersburg Times
TEXT: MOSCOW — Prime Minister Vladimir Putin, who has overseen the creation of government-backed national industry champions, surprised participants at the World Economic Forum in Davos on Wednesday by warning against excessive state intervention in the economy.
“The state’s role was brought to omnipotence in the Soviet Union in the last century,” Putin said in his opening address to the forum, which aims to debate a post-crisis world. “It finally led to our economy being totally noncompetitive.
“We paid dearly for that lesson. I am confident that no one would want to retry that.”
Putin, whose government is spending tens of billions of dollars in a rescue package, urged businesses to seek their own solutions to the economic hardships, saying that state aid is exhaustible and not always effective.
He also warned against excessive protectionism before offering a range of proposals that could avert a similar global economic debacle in the future. He said banks must write off their bad loans and assets, several strong regional currencies must replace the dollar as the single reserve currency, governments must better regulate local and international financial markets and the crude price must rise to a higher level.
Allowing crude prices to stay low will bar companies from developing new fields, prompting a lack of supply to fuel post-crisis economic growth.
“This will be a road to new crises,” Putin said, representing the country that is the world’s second-largest crude exporter.
He reiterated that the government would use the current problems as a “chance” to move away from the commodity sectors to a more high-tech economy. He said Russia would adopt economically justified tariffs for internal electricity pricing.
Russia will remain open to further foreign investment, Putin said.
In an apparent nod to the gas transit standoff with Ukraine earlier this month, Putin called for new international agreements to ensure energy security and championed Russia’s two proposed undersea pipelines that would carry gas to the European Union directly.
Restraint on military spending would help the economy, Putin said.
Just as global financial institutions failed to prevent the crisis, international political organizations have shown their impotence by failing to prevent Russia’s war with Georgia, the November terrorist acts in India and Israel’s attack on the Gaza Strip, Putin said.
VimpelCom chief executive Alexander Izosimov said he liked that Putin was against excesses in government regulation.
“Tranquility is the most important thing for all of us now,” he said by phone from Davos.
Putin’s attempts to stress Russia’s common interests with the rest of the world community was not enough to make investors forget about irritants such as the gas dispute and Georgia conflict, said Ian Hague, a partner at Firebird Management, which manages $700 million in Russian stocks.
“The most striking for me was Putin’s not mentioning the problems of the property rights and corruption in Russia,” Hague said from New York. He watched the speech on the forum’s web site. “Despite the financial crisis, they still are the biggest problems we are facing in this country.”
TITLE: Metropolitan Kirill Elected as New Orthodox Patriarch
AUTHOR: By Nikolaus von Twickel and Natalya Krainova
TEXT: MOSCOW — The Russian Orthodox Church elected Metropolitan Kirill, a long-standing church diplomat and skillful orator, as its new patriarch on Tuesday night.
Kirill, the interim leader since Patriach Alexy II’s death on Dec. 5, won 508 votes cast by the 702-member Local Council, Metropolitan Vladimir of St. Petersburg and Ladoga announced in the main hall of Christ the Savior Cathedral in Moscow at 10 p.m. The secret ballot was held in the cathedral, where the new patriarch will be crowned next Sunday.
Kirill, 62, is an experienced diplomat who has been the church’s point man in often-difficult negotiations with other churches, prompting speculation that he might take steps to improve ties with the Roman Catholic Church, which have been fraught with rivalry for years.
Kirill seemed to dampen such hopes in an address just before Tuesday’s vote, complaining about Catholic and other missionaries working in Russia.
“We have noted with bitterness that members of the Catholic clergy and monastic orders are among the newly formed enlighteners of Rus,” he said, Interfax reported.
Kirill also criticized “the assault of aggressive Western secularism against Christianity” and “attempts by some Protestant groups to revise the teachings of Christianity and evangelical morality.”
Kirill, metropolitan of Smolensk and Kaliningrad, is the first patriarch to be elected in post-Soviet Russia and is expected to wield not just spiritual but also considerable political clout.
Kirill’s election with a 72 percent margin came as no surprise after he emerged as the front-runner in a preliminary vote last Sunday among senior bishops, who nominated him with 97 out of 197 votes. The council of bishops had also nominated Metropolitan Kliment of Kaluga and Borovsk, with 32 votes, and Metropolitan Filaret of Minsk and Slutsk, with 16 votes.
But Tuesday’s election was reduced to a two-horse race after Filaret, who heads the Orthodox Church in Belarus, withdrew his candidacy. Filaret later said he wanted to strengthen unity within the church: “We must be unanimous, that is why I decided to withdraw. This is not a sign of protest,” he said in televised comments.
The Local Council decided not to exert its right to bring forward new candidates. Kliment, 59, manages the church’s economic affairs and has been described as the candidate favored by the Kremlin.
Although the church has been historically close to the government, Kirill had been widely expected to be the most likely successor to Alexy II. A good orator, he has headed the church’s department of external affairs since 1989 and hosts a weekly show called “The Pastor’s Word” on Channel One.
Religious experts said Kirill’s commitment to reconciliation with the Catholic Church should not be overestimated and that hopes of a meeting with Pope Benedict XVI were premature.
Kirill has said the church’s relations with the state should be based on “mutual noninterference in each other’s affairs.”
TITLE: Police Investigate Calls To GM Union Leader
AUTHOR: By Irina Titova
PUBLISHER: Special to The St. Petersburg Times
TEXT: St. Petersburg police are investigating a series of anonymous threatening phone calls made to the head of the trade union for the city’s General Motors plant Yevgeny Ivanov, the city police press service said on Thursday.
“The police are checking the situation and questioning employees of the plant on the matter,” said Vyacheslav Stepchenko, spokesman for the city police.
Ivanov said he had received at least four anonymous calls in the last few weeks with threats and demands to stop union work at the plant. Ivanov fears not only for his own safety but also for the safety of his family. Ivanov has two children.
Ivanov received the first call in early December. Later his wife received another call in which the caller said that “if her husband did not stop his activities, they knew which kindergarten one of their children attends,” Ivanov said.
Two other threats followed before Ivanov went to the police.
Sergei Lepnukhov, spokesman for GM, said he didn’t know about any threats received by Ivanov.
“We need to find out more about that situation, and only then to comment. First we need to figure out if those threats have any relation to the company,” Lepnukhov said.
Valery Pirozhkov, curator of the city’s Trade Union Center of the Russian Labor Confederation, said “such threats should be taken seriously.”
“We have the example of Alexei Etmanov, head of the Ford car-making plant’s trade union, who also previously received threats and later had problems,” Pirozhkov said.
Etmanov was attacked twice in November and considers the incident to be connected to his public and trade union activities.
Meanwhile, Ivanov said GM workers are worried about the plant’s plans to slash the working week to three days after restarting the assembly line on Feb. 9 after the New Year break.
“I know of cases when high quality workers have decided to leave the plant because they won’t be able to feed their families on the new salary. They are looking for better paid jobs,” Ivanov said.
St. Petersburg’s GM plant is shortening the working week after its U.S. owners said Tuesday it is cutting production in Russia as demand declines in a market only recently described as the largest in Europe.
The cuts affect GM’s new plant outside St. Petersburg and its venture with Russian manufacturer AvtoVAZ in Togliatti. GM’s Chevrolet is the best-selling foreign car brand in Russia.
Lepnukhov said the three-day week will be in place for the next few months, AP reported.
GM opened its new $300 million plant outside St. Petersburg in November with plans to produce 70,000 Chevrolet and Opel cars a year.
But with the Russian market already contracting, the plant closed down for an extended break from Dec. 20 to Jan. 19.
Production resumed for only one week before being shut down again.
In Togliatti, the GM AvtoVAZ venture is cutting back to one shift and laying off some 400 workers, about one-third of the workforce, company spokeswoman Lyudmila Murycheva said, AP reported.
The production cuts in Russia come as GM cut 2,000 jobs at two U.S. plants and halted production for several weeks at nine other U.S. factories. The U.S. car industry is facing its worst sales slump in 26 years.
Foreign car sales in Russia rose 26 percent in 2008, continuing a trend of several years, but were down 15 percent in November and 10 percent in December.
TITLE: Soldier Seeking Asylum Denies Political Motive
AUTHOR: By Anna Malpas
PUBLISHER: Staff Writer
TEXT: MOSCOW — A Russian soldier who deserted and is seeking political asylum in Georgia said Wednesday that his decision was not politically motivated and that he does not consider himself a traitor.
In an interview with Ekho Moskvy radio, the soldier, Alexander Glukhov, reiterated that he deserted his unit in the rebel republic of South Ossetia of his own accord.
“I left myself. No one forced me,” Glukhov said, adding that Georgia had promised to help him find work and an apartment in Tbilisi.
Glukhov appeared on Georgian television Tuesday saying he had decided to defect because of what he said were unbearable conditions in the army.
The Russian military, which crushed Georgia’s attempt to retake South Ossetia in a brief war in August, ordered Glukhov on Wednesday to return to Russia or face prosecution.
“It is self-evident that actions by Georgian authorities are the main obstacle for the Russian military serviceman’s return to his motherland. ... Such actions push the Russian army’s soldier to commit a criminal offense — desertion,” Igor Konashenkov, aide to the commander of the ground forces, said in a statement.
Georgian Foreign Minister Grigol Vashadze said Glukhov would not go home because “they would just make him rot in jail” in Russia, Interfax reported.
The Georgian Foreign Ministry sent a note to the Swiss Embassy, which represents Russia in the country, saying Glukhov was in normal health and is protected by international conventions, Interfax reported.
The Swiss Embassy plans to refer the question of Glukhov’s future to the UN High Commissioner for Refugees, Georgia Online reported.
Glukhov has spoken by telephone with his parents, who have been invited to visit him in Georgia, the Georgian Foreign Ministry said in a statement.
The statement also pointed to remarks by Glukhov on Georgian television that he began serving in the South Ossetian capital, Tskhinvali, in June. “These words ... provide ample evidence that Russia launched its military aggression against Georgia long before August,” it said.
Russian media, meanwhile, cast doubts on Gluhkhov’s motives for defecting. Citing army sources, Vremya Novostei reported Wednesday that Glukhov applied last year to continue his service on a contract basis. He was involved in “noncriminal business” with Georgians, who could have “turned Georgian special forces on him,” the report said, citing army sources.
Glukhov had four months left to serve, Konashenkov said.
“I just can’t believe that he ran over to the enemy because of bad conditions,” Glukhov’s mother, Galina Glukhova, told Komsomolskaya Pravda.
TITLE: Phone Tycoon On Wanted List
AUTHOR: By Alexandra Odynova
PUBLISHER: Staff Writer
TEXT: MOSCOW — The Basmanny District Court on Wednesday sanctioned the arrest of former Yevroset chairman Yevgeny Chichvarkin, who left the country last month and has not returned, in connection with allegations of smuggling, kidnapping and extortion.
The ruling was a victory for prosecutors, who filed a request last week to have Chichvarkin arrested on suspicion of involvement in the 2003 kidnapping and extortion of Yevroset’s logistics supervisor, Andrei Vlaskin.
Chichvarkin’s lawyer, Yury Gervis, said he would appeal the ruling, which has all but ensured that the businessman will not return to Russia.
“It is very difficult to build up a defense while stuck in jail,” Gervis said.
Chichvarkin, who acquaintances say is currently in Britain, has an international warrant out for his arrest, but it is unclear what, if any, steps Russian authorities are taking to secure his detention, Gervis said.
Chichvarkin’s assistant, Natalya Ikonnikova, answered the businessman’s cell phone Wednesday. She said she had not heard from Chichvarkin and that she learned about developments in the case from the media.
TITLE: City Hall Refuses Permission For Price-Hike Protest Event
AUTHOR: By Sergey Chernov
PUBLISHER: Staff Writer
TEXT: The democratic movement Solidarity will sue City Hall for its “unlawful ban” of a meeting against rising transport fares and housing tariffs that the recently formed group was planning to hold in St. Petersburg on Saturday, the Yabloko Democratic Party — some of whose members are also members of Solidarity — said in a statement on Thursday.
Garry Kasparov’s United Civil Front (OGF) said it will hold a series of one-person protests instead, while Eduard Limonov’s banned National Bolshevik Party (NBP) held a surprise protest on Thursday.
Three NBP activists handcuffed themselves to Prime Minister’s Vladimir Putin’s representative office in St. Petersburg demanding a meeting with Putin, while several others ignited flares and unfurled a banner calling for the government to answer for the economic crisis. They also took leaflets explaining NBP’s anti-crisis proposals to the government.
“We decided it would make no sense to be encircled by OMON [special-task police] so that everybody would get busted as happened at the last [Dissenters’] March [on Dec. 14],” local NBP leader Andrei Dmitriyev said by phone on Thursday.
“What makes sense is to hold such actions as we have done today, because they hit the authorities more painfully, they get a wider response, and it can be seen as our answer. If you don’t allow us to have meetings, you will get more hurtful blows like this. It corresponds to what Limonov has suggested about a change in the tactics of the opposition.”
The opposition meeting that was due to be held on Pionerskaya Ploshchad near the Theater for Young Spectators (TYuZ) on Saturday was not given permission by City Hall on Wednesday on the grounds that two stage productions were scheduled to be held at the theater on the day.
“There’s a winter skating rink located in front of the theater building that is particularly well-attended by citizens during weekends,” City Hall’s Law, Public Order and Security Committee also said in its letter to the organizers.
No alternative location was offered by City Hall, which violates Russian law, the organizers said.
“Earlier Governor [Valentina] Matviyenko publicly spoke about Pionerskaya Ploshchad as a location where public events can be held,” Maxim Reznik, the local Yabloko leader, said in a statement on Thursday.
“Now the authorities, in their paranoid hysteria and in a particularly cynical manner, have dropped any pretense of observing people’s constitutional rights.”
Article 31 of the Russian Constitution guarantees the “right to gather peacefully without weapons, hold gatherings, meetings and demonstrations, marches and pickets.”
Because of City Hall’s ban, Yabloko will not hold any protests on Saturday, spokesman Alexander Shurshev said on Thursday.
OGF, however, is planning to hold a series of one-person protests on Pionerskaya Ploshchad, Olga Kurnosova, the local leader of OGF and member of Solidarity said on Wednesday.
Such protests do not require any license from the authorities.
NBP activists Sergei Grebnev, Ravil Bashirov and Yevgeny Markin, who handcuffed themselves to Putin’s representative office earlier on Thursday, were detained, charged with “disorderly conduct” and taken to court, while activists who had protested outside the office managed to escape.
As this paper went to press, the court’s decision on the case had not yet been announced.
TITLE: Factory Staff Face Redundancy
AUTHOR: By Irina Titova
PUBLISHER: Special to The St. Petersburg Times
TEXT: The Finnish electronics producer Elcoteq is to lay off most of its personnel in St. Petersburg.
Elcoteq sent an announcement of the forthcoming redundancy of 366 people to the city’s employment committee.
Natalya Tanchuk, Elcoteq’s deputy general director in St. Petersburg, said the reduction would mainly affect production personnel.
“The enterprise only has left a group of specialists who will take care of potential projects, and technical service personnel to support the functioning of the plant. We are making all production personnel redundant,” said Tanchuk.
She said that the company’s management had decided on such measures because of a lack of orders, and a decrease in general demand for its products.
Tanchuk said that Elcoteq, which opened a local plant in 2005, was not closing in the city completely.
“We hope that in time, new opportunities will appear for the plant’s further development,” she said.
Tanchuk said employees had reacted to the plant’s decision “with understanding” because they can see the overall complicated situation in the economy.
“We’ve been trying to put off such measures for as long as possible, hoping for new projects, but we haven’t got any so far,” Tanchuk said.
In mid-January, the Finnish company’s management announced a temporary halt in production in some countries including Romania, the U.S. and Russia.
“The aim of the restructuring is to prepare the company for the unstable situation on the market, and for general economic development in 2009. This step will increase the company’s income,” an official statement by Elcoteq published on the company’s web site read.
The total number of those fired from Elcoteq enterprises is 5,000 people. Before the reductions, the company’s staff numbered 21,000 employees, Fontanka.ru reported.
The company hopes that these measures will enable them to save about $131 million.
TITLE: Hotels Await Decision on Price Fixing
AUTHOR: By Yelena Dombrova
PUBLISHER: Vedomosti
TEXT: The Federal Antimonopoly Service (FAS) for St. Petersburg is set to make a decision before the end of February on its investigation into agreed price hiking during last year’s St. Petersburg Economic Forum, it was announced on Wednesday by the head of the local FAS, Oleg Kolomiichenko.
Almost 10,000 visitors attended the St. Petersburg International Economic Forum, which took place on June 6-8, 2008. According to Kolomiichenko, some hotels put up their room rates by 80-100 percent, and the Grand Hotel Europe increased prices by 200-300 percent. From June 5 to 9, the hotel charged 220,000 rubles ($6,300 at today’s rate) for its junior suites and 380,000 rubles per day ($10,900) for its presidential suites, to the dismay of forum participants. The hotels face fines if found guilty.
Fifteen of the biggest five-, four- and three-star hotels are being investigated, with the exception of the Astoria, Angleterre and Oktyabrskaya, Kolomiichenko said, though he declined to name those under investigation. He said that the hotels had broken article 14.32 of the Administrative Violations Code of the Russian Federation.
Prices in the hotel are determined by demand on the market and are markedly seasonal, said Thomas Noll, general manager of the Grand Hotel Europe, via the hotel’s press service. According to Noll, in May and June market prices in St. Petersburg are higher than in Moscow.
Natalya Belik, PR director at the Corinthia Nevskij Palace, said that representatives of the hotel had provided officials with information on the hotel’s pricing policy and were now awaiting the decision of the anti-monopoly service.
TITLE: In Brief
TEXT: Deripaska Seeks $6Bln
MOSCOW (Bloomberg) — Oleg Deripaska has asked Russia for $6 billion in return for a 15 percent stake in United Company RusAl, the aluminum producer he controls, Kommersant said, citing billionaire Alisher Usmanov.
Usmanov, who together with Deripaska and other metals company owners met President Dmitry Medvedev this month to discuss how the industry can weather the global economic crisis, said the offer is for preferred shares only, the newspaper said.
President Wary of Graft
ST. PETERSBURG (Bloomberg) — President Dmitry Medvedev told Russia’s Federal Security Service to monitor the allocation of more than $200 billion in emergency measures as the government seeks to stem the country’s worst economic crisis since 1998.
“Any acts of corruption related to these measures must be uncovered and prevented,” Medvedev told officials of the agency Thursday, according to his web site. “It’s doubly criminal to get rich off the crisis.”
Renault Denies Report
ST. PETERSBURG (Bloomberg) — Renault, France’s second-largest carmaker, said it’s still committed to its factory in Moscow, denying a report in Kommersant newspaper that it plans to move production from the Russian capital.
The carmaker plans to double capacity to 160,000 vehicles at the plant, which it owns in partnership with the municipal government, Axelle de Ladonchamps, a spokeswoman at Renault’s Boulogne-Billancourt headquarters, said in a phone interview.
Kommersant reported Thursday that Renault may relocate the plant after Russian partner AvtoVAZ completes the acquisition of local carmaker IzhAvto.
Bleak Loans Outlook
MOSCOW (Bloomberg) — Most Russian companies will find it “practically impossible” to raise money abroad for at least six months, according to VTB Group Chief Executive Officer Andrei Kostin.
“External borrowing will be practically impossible unless it is guaranteed by the government,” Kostin said in an interview in Davos, Switzerland, adding that only Russian oil companies may be able to tap the international markets. “We do not expect the markets to re-open in the next six months.”
Jobless Rate Set to Soar
MOSCOW (Bloomberg) — The number of officially registered unemployed people in Russia may exceed 2.2 million by the end of this year, Interfax reported, citing the Health and Social Development Ministry.
Ukraine’s Banks in Need
KIEV (Bloomberg) — Ukrainian banks need an extra capitalization of 24.7 billion hryvnias ($3.16 billion), Kommersant-Ukraine said, citing a person with the knowledge of the matter.
Banks that are state-owned received recapitalization of 15 billion hryvnias in December and need 2.8 billion hryvnias more, the newspaper reported, citing an audit of the country’s 17 biggest lenders requested by the International Monetary Fund.
Ukraine’s foreign bank debt equals $42.1 billion, of which $16.8 is to be repaid this year, the newspaper said, citing presidential aide Roman Zhukovskyi.
Oligarchs Lose Billions
LONDON (Bloomberg) — The combined wealth of Russia’s oligarchs has plummeted by $260 billion in the past eight months as the credit crisis has caused the ruble and the biggest industrial companies to plunge in value, the London-based Times reported, citing Andrei Sharonov, the managing director of Troika Dialog, a Moscow-based investment bank.
Those who have lost heavily include Oleg Deripaska, Roman Abramovich and Alexei Mordashov, the newspaper said.
Speaking on the fringe of the World Economic Forum’s annual meeting in Davos, Switzerland, Sharonov commented that “in terms of public opinion, these guys are not heroes, so it’s not something that arouses much pity,” the Times added.
Conditional Bailouts
MOSCOW (Bloomberg) — Russian Prime Minister Vladimir Putin’s deputy Igor Shuvalov said owners of companies seeking emergency funding from the government should dip into their own pockets first because the state won’t help everyone.
“They have to use their own resources in order to clean up the debt they created,” Shuvalov told reporters at the World Economic Forum in Davos, Switzerland, on Thursday. “We are ready to provide all resources, administrative and material, but it isn’t as if we will help them no matter what.”
Russia’s government has approved a list of about 1,500 enterprises that are eligible to apply for the $50 billion that state investment bank VEB has to help companies pay down foreign debt. VEB has received $90 billion in loans for bids so far, Chief Executive Officer Vladimir Dmitriev said in Davos. About $11 billion has actually been dispensed, according to Shuvalov.
VTB Mulls Share Sale
MOSCOW (Bloomberg) — VTB Group Chief Executive Officer Andrei Kostin said the state-run Russian bank may sell new shares this year, mainly to the government, to boost capital as the amount of bad loans rises.
This will be a “very difficult year for banks,” Kostin said in an interview with Bloomberg Television in Davos, Switzerland. Next year will be “much better,” Kostin said.
Tax Cuts on Feb. Agenda
MOSCOW (Bloomberg) — Russian government officials will discuss further tax cuts for the oil industry next month, Deputy Economy Minister Stanislav Voskresensky said.
The policy makers will gather in the first 10 days of February, Voskresensky told reporters at the annual meeting of the World Economic Forum in Davos Switzerland on Wednesday.
Medvedev ‘Surprised’
FRANKFURT (Bloomberg) — Gazprom Deputy Chief Executive Officer Alexander Medvedev said he was surprised by E.ON Ruhrgas AG’s demand for compensation for costs incurred during a halt of Russian natural-gas supplies via Ukraine, Handelsblatt said.
The Essen, Germany-based gas unit of E.ON AG is a long-time Gazprom partner and shouldn’t seek to resolve differences in court or through the media, the newspaper cited Medvedev as saying in an interview.
TITLE: Kirill’s Vision of a Great Russia
AUTHOR: By Leonid Sevastyanov, Robert Moynihan
TEXT: Russia is a conundrum. On one hand, it is a profoundly secularized society in which traditional religious practice is sporadic and often superficial. This abandonment of the country’s traditional Orthodox faith is in part due to the period of state atheism from 1918 to 1991 and the subsequent 18 years of nihilism in which idealism is as out of fashion as religious belief. But on the other hand, Russian society longs for political idealism and religious faith.
And so Kirill, who was elected patriarch of the Russian Orthodox Church on Tuesday, faces a difficult problem. Within the church, he must go beyond what his predecessor, Alexy II, accomplished over the past two decades, rebuilding the institutional structures of the church. He must fill churches, seminaries, monasteries and schools with fervent believers. Outside the church, he must persuade society to engage with the church and seek to build a post-Soviet Russia that can flourish and provide a just, prosperous life for the Russian people.
Kirill has deep convictions about the role of the Christian faith in the future of Russia and about Russia’s role in the future of Europe and the world. As he has stated on numerous occasions, he is convinced that only a return to “real values” can enable Russia and Europe to confront the current economic crisis. Moreover, he believes that Russia’s greatness, eclipsed in recent years, can only be restored by renewing its ancient Orthodox faith.
Given his relatively young age, 62, Kirill could be patriarch for the next generation. He will undoubtedly set out to fulfill a double agenda. First, he will want to build on what Alexy II accomplished during the 18 years of his patriarchate, continuing the rebuilding of the church’s ruined infrastructure. Thousands of churches have been rebuilt across Russia since 1991. Second, he could start a series of new initiatives to strengthen the church’s voice and influence in Russian society.
The new patriarch can be expected to reopen schools, expand seminaries, renew monasteries and in general restore the outward signs of Russian Orthodox religious life. But Kirill, who was the key figure behind the unprecedented promulgation of the church’s social teaching in a document in 2000, can also be expected to take bold new steps to go beyond renewing the institutional structure of the church.
One big question concerns his relations with the pope and with the Roman Catholic Church. Kirill will be looking for allies in his effort to move Russian and European society in a religious direction. But he will not strive for a theocratic state. Indeed, it is precisely his acceptance of the need for dialogue with non-Christians in a modern, pluralistic state that has prompted some of the more conservative elements in the Orthodox church to be sharply critical of him as too “progressive.”
Kirill, who has been serving for eight weeks as “interim patriarch,” made his thoughts clear in a sermon he delivered on Jan. 6 at a Christmas Eve service held at Christ the Savior Cathedral. Kirill invited those present, including President Dmitry Medvedev and Prime Minister Vladimir Putin, to be valiant during the current economic crisis.
The word “crisis” comes from the Greek meaning “decision,” Kirill said. He said that today, decisions have been affected by attitudes such as “greed, loss of control over consumption, a bid to enrich oneself by all means and have as much as possible.” He said the crisis began when people forgot true values, and that further crises could be avoided if those values provided the foundation for the economy.
Kirill has his own vision for the future of Europe. In an address to the Third European Ecumenical Assembly in Sibiu in September 2007, Kirill said that in order for Europe to survive the tribulations that have befallen previous civilizations, it must retain its Christian identity. An increasing number of Europeans — Christians and non-Christians alike — have come to recognize “Christianity [as] a powerful source of support for European civilization,” he said.
At the same time, Kirill was careful to explain that this does not imply that “there is no room” in Europe “for people of other religions and with other outlooks on the world.”
With Kirill’s appointment as patriarch, Russian society opens a new page in its history.
Leonid Sevastyanov is general director of StratinvestRu and a consultant to the Moscow Patriarchate. Robert Moynihan is president of the Urbi et Orbi Foundation.
TITLE: The Oligarch’s Kondratyev Crisis
AUTHOR: By Yulia Latynina
TEXT: Russia’s business elite are getting all worked up that the country’s largest metals and mining companies might merge, with First Deputy Prime Minister Igor Sechin leading the project. The companies include Vladimir Potanin’s Norilsk Nickel, Alisher Usmanov’s Metalloinvest, Igor Zyuzin’s Mechel and Dmitry Rybolovlev’s Uralkali.
The real motive behind this project is that these metal and mining oligarchs want to create a structure in which they can get their hands on the state’s money and privileges to keep their empires alive.
It is noteworthy that Oleg Deripaska is not taking part in this “great unification” project. This is because he has already received a fat sum of the government’s bailout money. But Potanin, who suggested the idea for the merger, is in a completely different situation. In the mad scramble for Norilsk Nickel, he has practically lost control of the company.
And why is Usmanov so interested in the idea as well? When there was seemingly unlimited global demand for steel, his company, Metalloinvest, could dictate the price for steel pellets. But now Usmanov has his share of problems after the bottom has fallen out of the steel market.
Uralkali’s Rybolovlev has his own unique problems. He owns Florida’s most expensive house — a mansion in Palm Beach that he bought from Donald Trump for $100 million in June. Meanwhile, in the middle of Bereznyaky, near Perm, where Uralkali has its chief operations, there is an enormous crater at the site of a former potash mine, and the whole town is sliding into it. It is the greatest ecological disaster in the former Soviet Union since Chernobyl. I don’t know what it would cost to clean up the disaster, but if Rybolovlev sold his Palm Beach pied-a-terre, that would probably be enough to clean up the mess.
Rybolovlev had another problem. The Bereznyaky crater is located along the railroad that leads to VSMPO-Avisma, the world’s largest titanium maker, which fell under siloviki control when it was folded into the state conglomerate Russian Technologies. When the surrounding land began sliding into the hole, it became clear that the railroad would have to be moved. The cost was estimated at $10 million to $15 million. Government officials led by Sechin demanded that Rybolovlev pick up part of the bill for this work, but Rybolovlev flatly refused. Then he had to pay for it all.
Despite all of the commotion surrounding the unification of metal and mining companies, it will probably never happen. It is more a way of milking the state cash cow while jockeying for position and influence with the political elite than it is a serious business proposal. You might think that getting into bed with the Kremlin is like playing cards with the devil, but Russia’s oligarchs have long ago learned how to beat the devil at his own game.
More important, the troubles that these oligarchs are experiencing demonstrate a classic Kondratyev wave, named after Soviet economist Nikolai Kondratyev’s famous theory that capitalist economies have a 50- or 60-year cycle of expansion followed by depression.
You could say that Russia’s national metals and mining champions are now experiencing a “Kondratyev crisis.” Norilsk Nickel is a classic example of a dying giant. The metals oligarchs are turning to the Kremlin for help because they are sinking fast on the downward slope of Kondratyev’s cycle. And yes, the Kremlin might be able to keep them afloat for a time, but it looks like the crash brought on by the Kondratyev crisis will be no less severe than what we witnessed in the meltdown of 1991.
Yulia Latynina hosts a political talk show on Ekho Moskvy radio.
TITLE: Siege memories
AUTHOR: By Galina Stolyarova
PUBLISHER: Staff Writer
TEXT: If a member of Leningrad’s Bolshoi Symphony Orchestra didn’t show up at a rehearsal during the first months of 1942, fellow musicians would begin to feel a familiar nauseousness. They knew that nobody would pick up the phone when they rang the absentee — and that a rescue brigade sent to their home would find the musician dead.
With winter temperatures lower than minus 30 degrees Celsius and no electricity or heating during the second winter of the Siege of Leningrad, the orchestra’s pianist Alexander Kamensky kept his hands warm by placing two scorching bricks on both sides of the instrument to radiate some heat. The conductor Karl Eliasberg was so weak he was driven to rehearsals on a sledge.
The Bolshoi Symphony Orchestra held its first rehearsal during the 1941-44 Siege of Leningrad on March 30, 1942 performing throughout the Siege and eventually turning into the Academic Philharmonic Orchestra that plays today. The first rehearsal lasted for 20 minutes as everyone was too weak to continue. Oboeist Ksenia Mattus compared the conductor’s hand to a wounded bird falling out of the sky.
The original idea behind the creation of the orchestra was to bring hope to Leningraders living without electricity and heating. At that time the only sounds coming out of street-mounted loudspeakers were air-raid warnings and subsequent all-clear signals.
“The Leningrad authorities wanted to give the people some emotional stimulation so that they could feel cared for,” trombonist Viktor Orlovsky, who performed at the Leningrad premiere of Dmitry Shostakovich’s Seventh Symphony on Aug. 9, 1942, said in a 2004 interview with The St. Petersburg Times.
The symphoney is now known as the Leningrad Symphony and Shostokovich penned it in reaction to the tragic events of the Siege.
“The halls were always packed, at every performance, which I thought was extraordinary,” Orlovsky said. “During the hardest period of the Siege, when people’s daily ration dropped to 125 grams of bread, some would exchange their daily meal for a ticket to our concert.”
Many Leningraders who didn’t have a radio at home would gather on the streets to listen to orchestral music coming from the loudspeakers. It was an opportunity to rise above physical weakness, fear and starvation.
In his memoirs, pianist Kamensky recalls being asked to perform for the dying mother of a woman in the besieged city. They didn’t have a radio at home, and the mother was too weak to go outside. He came to their flat and played. “What happiness, happiness,” the dying woman said.
Although the members of the orchestra did receive additional rations to be able to go on stage and perform, their physical condition wasn’t much better than that of an average citizen.
Orlovsky remembered cutting the edges of his valenki (felt overshoes) to be able to stick his swollen feet in them. The musical instruments suffered a lot, too.
Orlovsky said he found out the orchestra had some unlikely admirers.
The Germans were close enough to the city to be able to catch the Leningrad radio signals that carried many of the orchestra’s concerts.
The musicians who performed to lift the spirits of Siege survivors appeared to have supported the emotional state of their enemy as well.
“Of course, we had a diverse repertoire, we played some Bach and Wagner,” Orlovsky said. “And some German prisoners of war admitted they couldn’t wait to listen to us, they needed the music just as much as the Russians. I didn’t feel frustrated when I found out. Of course I knew they weren’t all fascists.”
The orchestra gave 300 performances during the nearly 900 days of the Siege of Leningrad but the performance of Shostakovich’s Seventh Symphony was special.
Hitler had planned a banquet in Astoria Hotel on Aug. 9, 1942, the day of the performance. But not only hadn’t the Germans entered the city, not a single bomb fell on the Philharmonic on that night although the hall was lit up.
“There were no curtains, and the light was coming out of the windows,” Orlovsky said. “People in the audience were screwing up their eyes as they had got used to life without electrical light ... everyone was dressed up and some even had their hair done, the atmosphere was so festive and optimistic it felt like a victory.”
Eliasberg received a bouquet of flowers from a teenage girl who said her family did this because “life had to go on as usual whatever happens around.”
The musicians hadn’t known that the Soviet Army had developed a special secret operation specifically to protect the building during the performance of the Seventh Symphony, also known as the “Leningrad Symphony.”
Information about the operation was made public only 20 years after the event, and the orchestra themselves hadn’t known until then.
Many years after the end of the war the conductor Eliasberg was approached by a group of German tourists, who had once been on the other side of the barricades listening to his orchestra playing Shostakovich.
They came to town specifically to tell the musician that back then on Aug. 9 1942, they had known they would never take Leningrad. Because, they said, there was a factor more important than starvation, fear and death.
TITLE: Chernov's Choice
TEXT: The best news on the local music scene is that Morrissey has announced he will come to Russia as part of his Tour of Refusal that opens in Boca Raton, Florida on Feb. 28.
According to a schedule posted on Morrissey’s official web site, the former Smiths singer will perform the tour’s final concerts in St. Petersburg and Moscow.
Morrissey will perform at the Manezh Kadetskogo Korpusa in St. Petersburg on June 29 and at B1 Maximum in Moscow on July 1.
Rumors that the singer would at last come to Russia have circulated now and then for the past few years, but no dates were ever announced.
The tour will be in support of “Years of Refusal,” Morrissey’s forthcoming ninth solo album that he has described as his best.
“It’s fantastically strong,” he told BBC Radio 2 in October. “It’s very, very strong and it’s interesting for me after all these years, but it’s the strongest.”
The album is due to be released on Feb. 16 in the U.K. and Feb. 17 in the U.S. A stolen pirate version is already available on the web.
Ticket sales for the local show started in late December and although not sold out immediately as in Western cities, are going “steadily,” according to Ilya Bortnyuk, the head of Light Music promoter.
Light Music’s other confirmed concerts by international artists include Asian Dub Foundation, which will come as a full, 14-member band to perform at Manezh Kadetskogo Korpusa on Apr. 4, and Jane Birkin, who will come with a new set to perform at Music Hall on Apr. 19.
Birkin, who first performed in St. Petersburg in November 2005, released her new album “Enfants d’Hiver,” in November. According to her website, it is the first album for which she has written all the lyrics.
Birkin, who is also a human rights activist, campaigns to help political prisoners in Burma and supports a number of activities in favor of the Chechen people. Information about her causes, including a video for the song “Burma,” can be found on the Vigilance section of Birkin’s official website at www.janebirkin.net.
But not all the music news is good this week.
Although Russian newspapers praised a stadium show by Zemfira, the concert demonstrated the further convergence of well-known Russian rock musicians and the Russian authorities on Monday.
Students who mostly got their tickets for free as a gift from the city for Students’ Day, had to pay in other ways by listening to Governor Valentina Matviyenko and other bureaucrats speaking as well as to a number of third-rate support music acts.
The city spent 5.8 million rubles ($168,200), Zvuki.ru music news website reported, on the sop to students. Crisis? What crisis?
— By Sergey Chernov
TITLE: Neverending story
AUTHOR: By Matt Brown
PUBLISHER: Staff Writer
TEXT: Andrei Arshavin’s move to Arsenal is in danger of collapse because of the player’s refusal to rein in his financial demands, Zenit St. Petersburg general director Maxim Mitrofanov told Reuters on Tuesday.
It was just one salvo in a week of claim and counter claim about the star player’s future that have made Arshavin the most talked-about St. Petersburg citizen since Vladimir Putin.
Mitrofanov said the clubs had agreed a $21.17 million transfer fee for the Russian playmaker but the deal now hinged on Arshavin making a financial compromise to settle the repayment of half the bonus he received for signing a four-year contract in 2006.
Zenit wants the player to repay it himself or to take a lower salary from Arsenal to enable the London club to add the amount to their offer to make up the agreed transfer fee.
“I think that we are very close to a deal, we really want to sell him but I hope the player can forget about the huge sums of money he is asking for and I hope he can find a compromise,” Mitrofanov told Reuters.
“Unfortunately the player has taken the position that he does not want to compromise with either club.
“We have written again to Arsenal and we understand their position. We really want to sell him but it is up to the player to make a step.”
The weakness of the British currency has also played a part in the deal stalling, as an Arsenal offer of 12 million pounds ($17 million) last year was worth 18 million euros to Zenit, whereas now it is only around 12 million.
“That is not enough for us to be able to replace him,” Mitrofanov said.
Arshavin caught the attention of the big clubs when he helped Zenit to win the Russian title in 2007 and the UEFA Cup last season when he was named man of the match in the final.
The player also helped Russia reach the semi-finals of Euro 2008, losing to eventual winners Spain.
Since then he has been linked with moves to several clubs, including Barcelona and Tottenham Hotspur, but the deals failed to materialize.
Asked if he thought the move could be settled by Monday’s final day of the transfer window, Mitrofanov said: “I don’t know but I worry the deal might not be done. I hope he can find a compromise but he wants too much money from Arsenal.
“I’ve spoken to him personally and told him we are ready but it is his decision. Is it his dream or is it just a question of money?”
The glamorous player has already become an object of fascination for the soccer-mad British press and not only due to the torturous contract negotiations with Arsenel.
The Daily Mail for example on Tuesday quoted Arshavin’s thoughts on the 65th anniversary of the end of the Siege of Leningrad.
“Today is a great celebration,” he said. “To me, these are not empty words. I am proud that I was born in Leningrad, the city where the word ‘blockade’ is sacred. It seems to me that we should always remember those people who made a stand, who were not broken, who were able to protect our homeland.”
The seriousness of Arshavin’s words impressed the Daily Mail, which wrote that Arshavin “is never likely to be as revered as Alexander Pushkin nor as infamous as Grigory Rasputin, but his timely show of respect is a reminder to his 4.6 million fellow citizens that he shares their pride.”
Earlier on Tuesday, Arsenal manager Arsene Wenger said that no fee had been agreed.
“There is no news about Andrei Arshavin,” he told a news conference ahead of the club’s Premier League game against Everton on Wednesday. However, after the match, which ended in a lackluster 1-1 draw, Wenger told journalists the Arshavin deal was “90 percent” ready.
The Arshavin saga has been dragging on for months but it was thought a deal could be settled during the transfer window when soccer clubs are allowed to trade players.
Arshavin himself stepped into the fray on Wednesday telling Sport Express that he believed his chances of moving to Arsenal were receding.
The player was speaking from the Russian club’s preseason training camp in the United Arab Emirates.
“Media reports reaching me here in Dubai are contradictory,” RIA Novosti quoted Arhsavin as saying in Sport Express.
“I am still waiting for a final resolution to the situation, but I am aware that my chances of a move are decreasing.”
TITLE: Sushi town
AUTHOR: By Irina Titova
PUBLISHER: Special to The St. Petersburg Times
TEXT: The economic crisis seems to have forced the city’s gourmets to flee more expensive restaurants, sending them in search of refuge to more affordable cafes such as the sushi chains Yevraziya and Dve Palochki. Such places, dotted throughout the city (there are six Yevraziya outlets on Nevsky Prospekt alone), are full these days, especially on weekends. People even have to wait to get a seat.
So when we came to a Yevraziya sushi bar near Prospekt Bolshevikov metro station on Saturday night we were lucky to get the last vacant table. Two girls who came later had to sit and wait.
The interior of Yevraziya is quite modest but still creates a warm atmosphere. The walls and partitions are decorated with artificial bamboo, and there are white ball-shaped lamps that nicely contrast with the black tables. However, the place is a touch on the cramped side.
The popularity of Yevraziya is probably also a result of the timely discounts on sushi which are advertised on a big billboard along the road. Sushi that used to cost around 50-70 rubles ($1.50-$2) a portion is now being offered at Yevraziya for a reasonable 29 rubles (85 cents).
The discount tempted us to order almost the whole range of sushi offered on the menu. My companion ordered sushi with salmon, smoked salmon, redfish, tuna, octopus, boiled shrimp, smoked eel and mollusks. The sushi made with flying fish caviar was the most expensive at 69 rubles ($2).
I went for a completely different selection of sushi with pickled seaweed, Nameko mushrooms, Japanese omelette, scallop, sweet shrimp, mussel, and salmon caviar.
As the bar was packed we had to wait for about 40 minutes for the sushi, but the inordinately polite waitress did apologize for the delay. She had also hurried to bring us our hot minty towels and drinks on arrival.
And we were not left entirely hungry because we also ordered traditional Japanese Miso soup (70 rubles, $2), Tori Kido (pieces of pineapple fried with three type of paprika and chicken in Teriyaki sauce) for 265 rubles ($7.70), and Udon (wheat noodles with seafood) for 320 rubles ($9.40). These dishes came very quickly.
The Miso soup was served in a rather small bowl was impressively subtle and warming. Cooked on a base of tuna broth with various herbs, it surprised with its simplicity and tender taste.
My companion enjoyed his Tori Kido served on a hot iron tray. He said the fried pineapple was especially to his taste. The Udon was full of various seafood and the noodles tasted as if they were homemade.
The sushi finally came on medium-sized wooden boards, and did not disappoint. My companion particularly liked his sushi with shrimps and salmon, but an awkward move made some of the tiny, slippery Nameko mushrooms jump out of the seaweed in which they were rolled. There was no chance of catching the mouthwatering runaways with chopsticks and they became something of a decoration on the board.
The sushi was so nourishing that at one point we realized we should have saved some for home, especially since the bar offers doggie bags.
There was also a fairly long wait for dessert, but the Pineapple Tempura (200 rubles,$5.80) — hot pineapple pieces baked in dough and served with ice cream — was sweet and appealing.
TITLE: Afghan Polls to Be Later Than Planned
PUBLISHER: Agence France Presse
TEXT: KABUL — Afghanistan on Thursday delayed its second ever presidential election by three months to August 20, expressing hope that extra U.S. troops can ease the worst violence the country has seen in eight years.
President Hamid Karzai, who won the first presidential vote in 2004, is expected to lead candidates at the polls, despite weakened support among Afghanistan’s 30 million citizens because of endemic violence and corruption.
“The commission decided to hold the election on the 29th of Asad which corresponds to August 20,” Independent Election Commission chief Azizullah Lodin told a news conference.
The vote should have been held by May 22, in keeping with the constitution, but a postponement had been widely expected.
Around 70,000 foreign troops under NATO and U.S. command are helping Afghan government forces quell an increasingly violent Taliban-led insurgency in Afghanistan, particularly in the south.
“The international forces have expressed their readiness to send more troops in the course of the elections process to ensure better security,” the electoral commission said in a statement.
Afghan forces also said they would take measures to protect voters.
“But in both cases, taking the above-mentioned measures by the national and international security institutions requires more time,” said the commission.
Last year was the deadliest yet in the Taliban insurgency, launched when extremists regrouped after being ousted from government in the U.S.-led invasion in late 2001 for sheltering the Al-Qaeda network.
Afghan electoral law invests the commission with the power to change the date of the presidential poll should anything call into question the legitimacy of the vote, Lodin said.
“I have all the arguments [for a postponement] and all the points, security, budgetary and technical problems... you can see how many problems we have here,” the official said.
Preparations have also been hindered over the winter by snowfall that has cut off access to some areas.
The electoral commission, which has been registering voters since last October, previously spoke of intimidation and threats of suicide attacks, the hallmarks of extremist insurgents fighting against the government.
Questions have also been raised about the likelihood of voter turnout in insurgent hotspots along the southern and eastern borders with Pakistan, where the Taliban-led insurgency against Karzai and foreign troops is most intense.
Around 3,000 extra U.S. troops have already deployed in the provinces of Logar and Wardak, crucial in neighbouring Kabul, but up to another 30,000 soldiers, which would almost double the U.S. presence, are only expected later in the year.
One of their major tasks will be to secure the election.
TITLE: Klitschkos Seek All Four Belts In 2009
AUTHOR: By David Nowak
PUBLISHER: The Associated Press
TEXT: MOSCOW — Vitali and Wladimir Klitschko are worried that promoters will deny them the chance of holding all four heavyweight titles.
The Ukrainian brothers currently hold three of the belts — Wladmir is the IBF and WBO champion, and Vitali is the WBC champ.
Only WBA champion Nikolai Valuev stands between a historic four-belt family sweep.
The Klitschko brothers claimed Monday that Valuev’s promoters, Don King and German Wilfried Sauerland, are holding up the chance for one of them to take his title by offering an unacceptable share of the purse.
“Around the world fans and experts want to see this fight,” Vitali Klitschko said. “But these promoters are doing everything to make sure that this fight doesn’t go ahead.”
Vitali Klitschko said the purse should be split 50-50 because it would pit champion against champion.
Both Vitali, 37, and Wladimir, 32, said they would be ready to fight the 7-foot Russian, and Valuev himself has appeared agreeable to the idea.
“The most important thing is to bring the belt to the family,” Wladimir Klitschko said.
If the fight does go ahead, Wladimir Klitschko said, it will likely be toward the end of the year. That might be too late for the Klitschko brothers to achieve their dream of holding all four belts at one time.
TITLE: Man Throws Daughter Off Bridge
PUBLISHER: Agence France Presse
TEXT: SYDNEY — An Australian man was charged with murder after allegedly throwing his four-year-old daughter from a city bridge into a river during peak hour traffic on Thursday, police said.
The 36-year-old man, believed to be involved in a custody battle with the girl’s mother, allegedly threw her from a 60-meter high section of the West Gate bridge into the Yarra River in the southern city of Melbourne.
The incident took place in front of hundreds of motorists while two other children, boys believed to be aged six and eight, remained in the four-wheel drive, police said.
“No one had the opportunity to intervene ... it all happened fairly quickly,” Detective Inspector Steve Clark told reporters.
“He’s got straight out of the car and taken the young girl and walked to the edge of the bridge, so that would have happened in a matter of seconds.”
Horrified witnesses called police, who were on the scene within moments and retrieved her body from the water. They spent 45 minutes attempting to resuscitate the girl on the riverbank.
She died from severe internal injuries within hours of being airlifted to hospital.
The man was arrested outside the city’s law courts building with the two young boys shortly after the incident, and was “visibly distressed,” Clark said.
He was not mentally fit to be interviewed, and his lawyers said he could not appear in court because he was suicidal and in an “acute psychiatric state.” His case will be heard in May.
“It’s a dreadful set of circumstances, and often you think you’ve seen it all but you haven’t,” Clark said, adding that the man was believed to be embroiled in a custody battle with his wife.
“There have been some ongoing family court matters as I understand it between the father and his wife,” he said.
The couple reportedly reached an agreement in court on Wednesday appointing joint custody. The boys were interviewed by police and have been returned to their mother.
TITLE: Federer Eliminates Roddick In Semis
AUTHOR: By Paul Alexander
PUBLISHER: The Associated Press
TEXT: MELBOURNE, Australia — Roger Federer moved within one victory of his 14th Grand Slam title with another dominating victory, ousting Andy Roddick 6-2, 7-5, 7-5 Thursday to reach the Australian Open final.
Roddick, who undertook a rigorous offseason training regime designed to help him beat Federer and top-ranked Rafael Nadal, was in good form.
But the second-ranked Federer outplayed him in every phase of the game. Ripping winners from all over the court and usually forcing Roddick to hit more than one good shot to win a point, he even had more aces than the hard-serving American, 16-8.
“I served well in the first set and that gave me a lot of confidence,” Federer said. “I was moving well and getting a lot of balls back and making it difficult for Andy to get the upper hand from the baseline. That was kind of what I was hoping for.”
Federer, seeking his fourth Australian title, will face the winner of Friday’s semifinal between Nadal and fellow Spanish left-hander Fernando Verdasco.
“I don’t have to wait to see who wins, I can start preparing for a leftie tonight,” Federer said.
The women’s final matchup was set earlier in the day. Serena Williams was calm, collected and cool — with the Rod Laver Arena roof closed to keep out Melbourne’s oppressive heat wave — to end Olympic champion Elena Dementieva’s 15-match winning streak with a 6-3, 6-4 victory.
All that stands between her and a 10th Grand Slam title is third-seeded Dinara Safina, who is hungry to take home her first major trophy to go along with the two that brother Marat Safin has earned. Safina ousted fellow Russian Vera Zvonareva 6-3, 7-6 (4) in the other semifinal. The winner Saturday also will rise to the No. 1 ranking.
By the time Federer and Roddick were on court in the evening, temperatures had dropped to 91 degrees from 112 in the afternoon — news reports called it Melbourne’s hottest January day since 1939 — so the retractable roof was open.
That would seem to have given Roddick, who grew up in the heat of Texas and Florida, an edge. Against a hot Federer, it didn’t matter. A behind-the-back hit right to the ballboy after a Roddick fault in the first game was a dead giveaway.
Although Roddick won their last meeting, Federer held a 15-2 edge over him coming into the match.
“The last time I lost, so coming into this match there was a bit of pressure,” Federer said.
It didn’t show. Instead, this one played out like many of the Swiss star’s previous victories.
“Towards the end of the tournament, I think this is where you should judge a great player,” Federer said.
TITLE: Wilkins Defends Scolari After Boro Card Contoversy
AUTHOR: By Nick Morrison
PUBLISHER: Agence France Presse
TEXT: LONDON — Chelsea assistant manager Ray Wilkins defended Luiz Felipe Scolari after the Blues boss appeared to encourage referee Lee Probert to send off a Middlesbrough player at Stamford Bridge.
Scolari and Boro assistant Malcolm Crosby were involved in heated exchanges moments before half-time when Crosby took exception to the Brazilian waving an imaginary card from the touchline after Mohamed Shawky handled the ball.
Shawky had already been cautioned and Scolari’s actions were perceived to be an attempt to get the Egyptian midfielder dismissed.
“It’s a very emotional game,” said Wilkins after Chelsea’s 2-0 victory. “Passions do run high — they ran high on their bench, they ran high on ours.”
Wilkins said he was all in favor of the Football Association’s recent “Respect” campaign which is designed to reduce such behaviour by management and players.
“I’m all for respect — but if the referee felt he needed to be sent to the stands then he would have done so.
“[Assistant referee] Steve Bennett was on the side so he didn’t advise the referee to send him to the stands so they must have felt it was OK.”
Boro boss Gareth Southgate played down the incident though he was puzzled at Scolari’s refusal to shake hands with him after the game.
“There were words exchanged between my assistant and Scolari — he wanted to get one of our players booked and we weren’t happy with that,” said Southgate.
“He didn’t shake hands with me, which is a bit strange, but that’s his prerogative.” A pair of goals from Salomon Kalou saw Chelsea to a comfortable win, moving them to second spot in the table.
The Ivory Coast striker netted in the 58th and 81st minutes to ensure the Blues condemned relegation candidates Boro to an 11th consecutive league game without a win.
Victory Scolari’s side saw them close to within two points of league leaders Manchester United, who have a game in hand, and ahead of Liverpool on goal difference after the Merseysiders were held 1-1 at Wigan Athletic.
Chelsea travel to Anfield on Sunday and Scolari will be confident after seeing his side notch up their fourth straight victory in all competitions.
Captain John Terry returned to the Blues’ defence following a back injury while midfielder John Obi Mikel, suspended for the FA Cup win over Ipswich on Saturday, replaced Juliano Belletti, who was ruled out through illness.
Chelsea looked threatening from the start and a promising run by Kalou after six minutes saw the Ivorian beat two tacklers before being muscled off the ball.
Shawky was booked three minutes later for a scything challenge on Florent Malouda.
Chelsea’s best chance of the half came when Jose Bosingwa found Ashley Cole at the back post in the 13th minute, but the England left-back could only send his downward header into the side netting.
Didier Drogba was brought on for Malouda at the interval and the 30-year-old frontman immediately worked an opening before screwing his shot across goal.
The Blues had the lead in the 58th minute when Kalou lashed home from eight yards.
Kalou wrapped up the points when Boro keeper Ross Turnbull missed a Frank Lampard cross and the striker nodded in from six yards, nine minutes from the end.
TITLE: Madagascan City Is Ghost Town After Riots
PUBLISHER: Agence France Presse
TEXT: ANTANANARIVO — The Madagascan capital was deserted Thursday as citizens heeded a call by the mayor to turn it into a ghost town after anti-government protests that have left at least 68 people dead.
Antananarivo Mayor Andry Rajoelina urged residents to protest this time by staying at home and making the capital a “dead city” as he issued an ultimatum to the government to punish those behind the killing of a protestor on Monday.
Shops and businesses were shut, schools remained closed and the weekly Thursday market was empty with only small stalls in local neighborhoods open, an AFP correspondent reported.
Some in the desperately poor Indian Ocean nation expressed disquiet at the protests, especially at the effect the unrest was having on the price of basic goods.
“The mayor made a ghost town protest today. We do not agree with the protest because it only brings us financial problems. We cannot allow ourselves to go on strike,” said Irene Ralambomana, 56.
“Prices have tripled in the last two to three days. We cannot find (cooking) oil.”
While banks and the post office were open and public transport was still running, few cars passed on the empty streets and only a handful of government workers turned up for duty.
“We did not receive any instructions to come or not to come [to work],” an education ministry official said on condition of anonymity.
The scene was strikingly different in the capital on Monday when days of protests against President Marc Ravalomanana’s government, led by Rajoelina, turned violent as protesters looted shops and set fire to state buildings.
Ravalomanana, 59, had cut short his trip to a regional summit in South Africa on Sunday and rushed home to try and quell the crisis only for the situation to badly deteriorate.
Police said at least 42 people lost their lives during the violence in the capital, including 30 rioters who were crushed by a ceiling that collapsed in a supermarket fire.
TITLE: Israeli Blockade Hinders Rebuilding of Ruined Gaza
AUTHOR: By Alastair Macdonald
PUBLISHER: Reuters
TEXT: GAZA — Whole streets lie in ruins, many thousands of Palestinians are homeless after weeks of Israeli bombing and foreign aid cash is piling up. As a builder in the Gaza Strip, this should be Anwar al-Sahabani’s big moment.
Instead, though, he sits at home, angry and sad, not just at the wounds he suffered on the first day of bombardment, but with frustration at being denied the basic supplies he needs to start rebuilding. Israel will not let in cement, steel pipes and other materials it says its Hamas enemies might use to make war.
“The fighting stopped over a week ago but people are still sleeping in the open air,” said Sahabani, whose firm employs up to 100 craftsmen and laborers when working at full capacity.
“We should have started reconstruction the day the war ended. But we have no supplies.” His men, like him, sit idle, he said: “I am sad and angry and I feel a pain beyond words.”
Along the 45 kilometer strip of Mediterranean coastline, half-finished construction sites stand silent, and, amid the ruins left by this month’s violence, families are building makeshift wood-and-plastic shelters to escape the cold.
“For two years now, we have not been able to build,” Sahabani said of an Israeli embargo going back to 2007. “God knows what will happen now to the people who lost their homes.”
Across town, Nabeel al-Zaeem, understands. His Palestinian Commercial Services Co. is Gaza’s top importer of cement.
Only these days, he has no cement.
“We need cement to rebuild the Gaza Strip, because of the Israeli offensive and the comprehensive destruction,” he said on a quiet morning this week at his office overlooking Gaza’s blockade-hit fishing port. “But we have no raw materials.”
He was able to import only a fraction of what he needed since June 2007, when Hamas, victors in a 2006 parliamentary election, seized full control in the Gaza Strip from forces loyal to Western-backed Palestinian President Mahmoud Abbas.
Peter Lerner, a Defense Ministry official dealing with trade for Gaza, said Israel was helping international aid agencies in their efforts to move in the food and other vital supplies for the 1.5 million Gazans, most of whom are refugees, from families that fled or were driven from what is now Israel in 1948.
But until Israel was satisfied that cement would not be used by Hamas for fortifications and that steel pipes would be used only for plumbing and not to build improvised rockets for firing at Israeli towns, the embargo on construction material remained:
“We are working together with the international community to assist those needs that are beyond the humanitarian issues, such as building and reconstruction,” Lerner said.
But he added: “We are not interested today in rebuilding Hamas, their bunkers. We are not interested in supplying them with pipes that will be used for rockets.”
Amid the shaky ceasefire that has followed an offensive intended to deter Hamas rocket fire, Israeli ministers have also said this week that supplies will not re-start until Hamas frees an Israeli soldier, Gilad Shalit, who was taken captive in 2006.
But John Ging, who runs the United Nations Refugee and Works Agency operations supplying much of Gaza’s population with basic rations, schooling and other essentials, said getting building materials into the enclave must be a priority: “This is the number one issue,” he said. “We have to get the crossing points open now to get everything that is needed to rebuild Gaza.”
Cement importer Zaeem said that even if the blockade were lifted it would take years to bring in all that was needed: “We need now 8,000 tons a month,” he said. “And even at that rate we would need three years to repair the damage.”
In all last year, he said, about 20,000 tons came in, all from Israeli quarries — Gaza has no cement industry. A crossing from Egypt is also largely closed, in coordination with Israel, and smuggling tunnels that provide many of the goods in Gaza’s stores cannot supply large quantities of building materials.
The World Bank says projects worth $240 million were frozen due to the blockade after Hamas took over and 42,000 workers had been laid off.
Yet even before losing some 5,000 homes this month and sustaining damage worth up to $2 billion by international estimates, Gaza was in dire need of a construction boom. At its present growth rate, the population is doubling with every generation, creating an acute shortage of schools and housing.
“It is just not acceptable in the 21st century that 1.5 million people are imprisoned like this,” said Zaeem, dismissing Israel’s security concerns about uses of cement as a “pretext.”
UN officials have described Israel’s blockade as illegal “collective punishment” of civilians and some Israelis also criticize the policy for fueling Palestinian resentment against the Jewish state while failing to stop Hamas attacks.
TITLE: Thousands of Workers Strike Across France
PUBLISHER: The Associated Press
TEXT: PARIS — Hundreds of thousands of angry and fearful French workers mounted nationwide strikes and protests Thursday to demand President Nicolas Sarkozy do far more to fight the economic crisis.
Public and private sector workers united in the protest to seek increases in salaries, greater protection for their jobs and more intensive government efforts to simulate the economy.
Commuters in Paris braved freezing temperatures and biked, walked and even took boats to work, as trains were idled by the strike and stations stood empty. But a 2007 law ensuring minimal transport service meant that some subways, buses and suburban rail lines still had to operate — and those that did were stuffed to the gills. Delays were considerable.
Some schools were closed, banks were shut, and mail went undelivered as thousands of teachers and postal employees across the country stayed off the job. Some workers at factories hit by layoffs also joined the strike. Hospital staff also stayed off the job.
Eight national unions banded together to support the strike, an unusual show of force. The big question was whether private sector employees would join a major demonstration planned Thursday afternoon in Paris.
Bernard Thibault, the head of the influential CGT union, said it was not possible for Sarkozy to say “I saw nothing, I heard nothing and I have nothing to say.”
Over a third of the country’s teachers refused to go to school. Elementary schools were especially hard hit, and many parents had to stay home to care for their children.
A quarter of all postal workers stayed off their jobs. Some workers at the Paris stock exchange took to the streets. Just over 10 percent of flights at Charles de Gaulle airport were canceled and a third at the smaller Orly airport. Many flights took off late.
For his part, Sarkozy has remained silent on the strike. On Thursday, he had nothing planned on his agenda and was spending the day in the Elysee Palace.
Despite Sarkozy’s wait-and-see attitude to what has been dubbed “Black Thursday,” his government is anxious and has paid close attention to unrest in other European countries such as Latvia and Lithuania. A major reform of French high schools was scrapped late last year after student riots in Greece.
One of the government’s big worries is to ensure that Thursday’s labor unrest does is not transformed into a wider social protest such as that inflamed French suburbs in the fall of 2005.
Jobs top the list of worker concerns amid a marked deterioration of the French economy that has accelerated in recent months. Growth in 2009 is expected to be close to zero, unemployment is rising at the fastest rate in 15 years, and consumer spending has plunged.
Sarkozy recently announced a $33 billion stimulus plan, but the unions believe it is not enough.
Marie-Georges Buffet, the head of the French Communist Party, said she hoped that today’s protest would lead to others in the future.
“Today is the first large day of unified mobilization,” she said on I-tele. “I hope tomorrow that there will be others.”
For their part, commuters appeared resigned to the year’s first big strike.
“I’m not against the fact that people demonstrate to defend their interest and their benefits as they say, but is this really the best time to do it considering what is going on right now with the economic crisis?” Pierre Rattier, a commuter, told AP Television News.
TITLE: Sri Lanka Makes Progress In Battle Against Tigers
PUBLISHER: The Associated Press
TEXT: COLOMBO, Sri Lanka — Sri Lankan forces captured a key northern crossroads and several bases from the Tamil Tiger rebels, the military said Thursday, while the United Nations evacuated hundreds of wounded civilians who had been trapped in the war zone.
Human rights groups expressed growing concern for the safety of hundreds of thousands of noncombatants, reportedly still trapped inside the shrinking patch of jungle and villages that remains under rebel control.
Ground troops overran the Vishwamadu junction on Wednesday afternoon after heavy fighting with the rebels, military spokesman Brig. Udaya Nanayakkara said. The junction, just outside the village of Vishwamadu, lies along one of the few major roads remaining in rebel-held territory.
The army also captured several rebel camps — including a bunker complex with a luxury room and conference hall — in fighting throughout the day Wednesday, the military said.
In one camp, the troops captured an armored personnel carrier, in another they found an armored submarine, three partially built mini-submarines and an attack boat, the military said. The rebels were not available for comment because most communication to the north has been cut. Independent accounts of the fighting are not available because most journalists are barred from the war zone.
With the conflict zone shrinking amid the army offensive, reports have grown of rising civilian casualties in the area.
Amnesty International accused the rebels Wednesday of preventing a convoy organized by the Red Cross and the United Nations from transporting hundreds of wounded civilians from the war zone.
UN spokesman Gordon Weiss said the convoy was allowed to leave Thursday and crossed into government territory in the late morning. It included “50 critically injured children on board and some hundreds of [other] critically injured.”
Dr. Thurairajah Varatharajah, the top health official in the war zone, said at least 1,140 civilians were wounded in the past week and estimated at least 250 were killed in the fighting.
The United Nations said some staff members and their relatives were huddled in a bunker over the weekend in a government designated “safe zone” when artillery shells landed nearby and killed nine people taking shelter 10 meters away. An internal UN memo said the shells were apparently fired by government forces.
Military spokesman Brigadier Udaya Nanayakkara has said no civilians had been killed, but that some people who were forced by the rebels to build fortifications might have been wounded in crossfire.
Human rights groups have accused the rebels of keeping an estimated 250,000 civilians in the war zone to use as human shields against the government offensive. The rebels deny keeping anyone against their will.
TITLE: Ford Says It Doesn't Need Help Despite $5.9 Billion Loss
PUBLISHER: Agence France Presse
TEXT: CHICAGO — Ford announced Thursday a quarterly loss of $5.9 billion, capping a nightmarish year, but said it had “sufficient liquidity” to fund its turnaround plan without U.S. government aid. The number two U.S. automaker’s results showed a sharp widening of its losses as auto sales were slammed in the fourth quarter by a deep economic crisis and credit squeeze.
But Ford said that unlike rivals GM and Chrysler, it had enough cash to keep operating as it executes a restructuring plan.
“Based on current planning assumptions, it does not need a bridge loan from the U.S. government, barring a significantly deeper economic downturn or a significant industry event, such as the bankruptcy of a major competitor that causes disruption to the company’s supply base or creditors,” Ford said.