SOURCE: The St. Petersburg Times
DATE: Issue #1471 (33), Tuesday, May 5, 2009
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TITLE: Public Not Impressed By Graft Measures
AUTHOR: By Anna Malpas
PUBLISHER: The St. Petersburg Times
TEXT: MOSCOW — When senior officials declared their incomes and those of their wives and children last month, some claimed that they owned tiny apartments and ancient cars -- while others said they earned as much as $11 million and owned snazzy Porsches and Lexuses. 
Ordinary Russians merely shrugged; they expected nothing less. 
“The declarations didn’t make any real impact,” said Kirill Kabanov, head of the National Anti-Corruption Committee, a think tank. “There’s no challenge to society. The public didn’t expect anything different.” 
But President Dmitry Medvedev did succeed in ruffling feathers by forcing top officials to reveal their incomes as part of an anti-corruption drive, a flagship program of his administration. Many mid-level bureaucrats have good reason to worry; they will be next, analysts said. 
Officials had to include property and earnings by their wives and underage children for the first time in their income declarations. 
Several officials claimed to own no cars, or only a 10-year-old car, like Medvedev’s wife, Svetlana, who is often photographed in designer outfits. Several officials said they owned no property at all, like Vladislav Surkov, the powerful first deputy head of the presidential administration. 
On the other hand, some officials declared extreme wealth, such as Natural Resources Minister Yury Trutnev, who put his earnings at about 370 million rubles ($11 million) and listed among his property a Porsche Cayenne and a Porsche 911. 
The staff at the Prosecutor General’s Office also published their declarations, revealing that Alexander Bastrykin, the head of the Investigative Committee, could vacation in the Czech Republic in an apartment owned by his wife. This inflamed United Russia Deputy Alexander Khinshtein, who told Kommersant that it was “nonsense” for a senior official’s family to own property in a NATO country. Bastrykin also declared earnings of 5,255,800 rubles ($156,702), more than Medvedev (4.13 million rubles, or $123,900) or Prime Minister Vladimir Putin (4.6 million rubles, or $138,350). 
Opinion polls on the declarations have shown mixed results. A VTsIOM poll found that 31 percent of Russians rated the idea of the declarations as an “excellent, long-overdue anti-corruption measure.” 
Meanwhile, an informal poll conducted on the web site of Vedomosti asked if the publication of the declarations was an effective anti-corruption measure. Eighty percent of respondents said “no.” 
“The average Russian understands very well that a bureaucrat can’t be poor,” said Alexei Mukhin, an analyst with the Center for Political Information. “Medvedev practically took no risk” in requiring the declarations. “There was never going to be any public outrage. That would be nonsensical.” 
Public interest in the declarations is rather selective, Mukhin said. People were interested to read about Medvedev and Putin but felt “indifference” to the rest. They would rather see oligarchs’ earnings, he said. 
Medvedev, however, is thinking beyond immediate popularity, said Tatyana Stanovaya, an analyst with the Center for Political Technologies. 
“This is a personal, historic project of Medvedev that is not linked to short-time aims of raising public faith in officials right now,” she said, pointing to a speech that Medvedev gave to a group of human rights activists late last month. 
Medvedev told the activists that many people had told him not to get involved in fighting corruption, saying, “Why bother, because you won’t solve it quickly all the same?” 
The president also described his anti-corruption campaign so far as “modest steps.” 
“Medvedev is thinking like a lawyer,” Stanovaya said. “It’s the beginning of a very long journey.” 
Medvedev was unable to push through legislation forcing lower-ranking officials to declare their families’ income and property this year. Instead, State Duma deputies postponed those declarations to 2010. 
Deputies “turned the bill into a damp squib,” Mukhin said. “Medvedev was clearly not happy.” 
“There’s a standoff between the bureaucracy and what the president wants,” Kabanov said. 
Things promise to get interesting next year when the legislation takes effect for lower-level bureaucrats, Mukhin said. The declarations will be used to remove the “most-hated figures” and the “unjustifiably rich” from among lower-ranking officials, he said. “Bureaucrats are about to have a mass inventory.” 
The legislation, however, lacks a clear explanation of who should check the declarations and concrete punishments for providing false information. 
It would be more effective for officials to declare not only income but their families’ business interests as well, said Vladimir Yuzhakov, an analyst at the Center for Strategic Research. 
“It often happens that an official makes decisions on an enterprise where he has shares or his wife is on the board,” he said.

TITLE: NATO Tensions Flare Up Over Spy Flap
AUTHOR: By Nikolaus von Twickel
PUBLISHER: The St. Petersburg Times
TEXT: MOSCOW — A new round of tensions with the West ratcheted up over the holiday weekend when a spy dispute unfolded with NATO that is expected to prompt Russia to expel Western diplomats. 
NATO also traded barbs with the government over an agreement giving Russian forces direct control over the de facto borders of Georgia’s South Ossetia and Abkhazia regions. (Story, Page 5.) 
The tensions are likely to grow this week, because NATO plans to kick off military exercises in Georgia that have drawn fire from Moscow, which itself is preparing for Victory Day, the May 9 holiday celebrating the end of World War II. 
NATO last week expelled two senior diplomats from Russia’s permanent mission to the alliance’s headquarters in Brussels on spying charges, just hours after it had resumed official contacts with Moscow that had been severed since last year’s brief war in Georgia. 
Russia’s NATO representative Dmitry Rogozin said Thursday that the alliance’s secretary-general, Jaap de Hoop Scheffer, briefed him about the expulsion just after the NATO-Russia Council had convened for the first time. 
Rogozin vehemently denied that the diplomats had been involved in spying activities. 
“These accusations are fabricated, irresponsible and provocative,” he said, Interfax reported. 
The Foreign Ministry issued a furious statement in which it accused elements inside NATO of trying to disrupt the normalization of ties with Moscow. “We ask all NATO members to think about the consequences. We will certainly make our conclusions from this provocation,” the ministry said. 
Diplomats said that from the statement’s wording, a tit-for-tat expulsion seemed unavoidable. “They will have to expel someone this week, and the interesting thing to watch will be which country will be hit,” a senior Western diplomat told The Moscow Times, speaking on condition of anonymity because of the sensitivity of the matter. 
Reciprocal expulsions are complicated by the fact that NATO only has an information office in Moscow, and it is nothing close to matching Russia’s NATO mission in Brussels. 
NATO officials linked the expulsion to the uncovering of a top Russian spy, Herman Simm, in Estonia last year, news reports said. 
A NATO spokesman reached by telephone Sunday refused to comment on the affair. 
NATO’s headquarters in Brussels, where the alliance expelled two Russian diplomats on spy charges last week.
Simm, the former head of security at the Estonian Defense Ministry, was sentenced to 12 years in prison in February for passing NATO secrets to Moscow. 
Yet questions remained why NATO would choose to retaliate more than two months after Simm’s conviction just as it was taking the key step of rebuilding ties by getting the NATO-Russia Council back to work. 
Rihards Piks, a former Latvian foreign minister who is a deputy in the European Parliament, said that the timing of the spy spat was counterproductive. 
“It is not in NATO’s interest to disturb the dialogue with Russia,” he said by telephone from Riga on Sunday. 
He said NATO’s member states should continue to talk and develop relations with Moscow. 
Alexei Malashenko, an analyst at the Carnegie Moscow Center, suggested that the whole affair might have been staged by a Kremlin faction that is opposed to better relations with the West. 
“This is a very typical step for Russian foreign policy, and this might point to forces in the Kremlin that are against resetting ties,” Malashenko said. 
In another twist, one of the expelled Russian diplomats, Vasily Chizhov, is the son of Moscow’s ambassador to the European Union, Vladimir Chizhov. 
Vasily Chizhov was a mission secretary, while the other expelled diplomat, Viktor Kochukov, headed the political section, Rogozin said. 
A Foreign Ministry official said that Ambassador Chizhov’s work would not be affected by his son’s expulsion, Interfax reported.

TITLE: May Day Celebrations in the City Marred by Mass Arrests
AUTHOR: By Sergey Chernov
PUBLISHER: Staff Writer
TEXT: Mass arrests were made in St. Petersburg early on Friday as people gathered on Ligovsky Prospect in the center to take part in May Day demonstrations. The police said the arrests were made to prevent anarchists from attacking nationalists, but anarchists denied that any attack had been planned.
May Day, introduced as an important official holiday called International Workers Day under the Soviets, continues to be celebrated (under the new name Spring and Labor Day) with mass demonstrations in post-Soviet Russia. However, unlike the Soviet era, the Kremlin’s opponents take part in protest marches, as well as the pro-Kremlin parties United Russia and Just Russia.
As reported by Interfax, the Interior Ministry announced that more than 800 public events were planned in Russian cities, including over 300 rallies and about 200 marches. Around 36,000 people took part in May Day events in St. Petersburg, police spokesman Vyacheslav Stepchenko said on Monday.
Thousands of OMON special force police, regular police officers, Interior Ministry troops, and civilian volunteers were deployed in the center of St. Petersburg on Friday. Although the Interior Ministry disclosed that a total of 100,000 policemen and 4,000 Interior Ministry troops were to be deployed countrywide on Friday, the local police declined to provide specific figures for St. Petersburg. 
Shortly before 11 a.m. dozens of OMON officers, complete with helmets and body armor, attacked a 250-strong group of anarchists and anti-fascist activists. They arrested over 130, some brutally, hustling them aboard two buses. Ten minutes later a group of nationalists of approximately the same size were backed up against a building, and about 20 activists were detained as well. Both groups had permits issued by City Hall.
The majority of demonstrators, however, were from pro-Kremlin parties such as United Russia and Just Russia as well as the official Federation of Trade Unions. They marched on Nevsky to Palace Square, where they held a rally. Estimates of their number ranged from 2,000 to 3,000.
Unlike last year’s May Day, democrats chose not to march with Eduard Limonov’s banned National Bolshevik Party (NBP) as part of Limonov and Garry Kasparov’s pro-democracy coalition The Other Russia, but under the banner of the new Solidarity democratic movement, which was formed with Kasparov’s participation late last year. Joined by the Yabloko Democratic Party, Solidarity had a meeting on Pioneer Square that drew around 350 people.
A 100-strong group of National-Bolsheviks, carrying red flags and a banner that read “There Is Such a Party,” marched behind the larger group of Communists (about 1,000) and joined them for a rally on St. Isaac’s Square.
Extreme nationalists such as the Movement Against Illegal Migration (DPNI) and the Slavic Union (SS) marched with nationalist slogans such as “The Russians Are Coming,” “We’re the Russians, God Is With Us” and “Serbia Is Kosovo,” as well as Russian imperial flags.
Police spokesman Stepchenko said the arrests on Ligovsky Prospect were made because the police had received inside information about an “active action” (i.e., violent attack) that anarchists were preparing against ultranationalists. He said 100 anarchists and 20 nationalists were detained, adding that some of the detained nationalists had self-defense weapons in their possession.
But anarchists denied any such attack was planned. They claimed that what they were organizing was a “street party,” which was to include a disco and a concert. The event was meant to show solidarity with Pirate Bay, the Sweden-based torrent tracker whose organizers were recently sentenced by a court in Sweden.  The anarchists brought musical instruments, pirate paraphernalia, and anti-copyright slogans.
Despite the police claims of the planned attack, most of the arrestees were charged with “jaywalking,” although the area was closed to traffic and there was no other street to cross except Ligovsky Prospekt, where thousands of marchers had already gathered along with hundreds of police. Only a few of those arrested were charged with minor offences or with using profane language.
“We were not planning anything like this – what we were planning was a disco and a concert,” Dmitry, one of the organizers of the anarchist rally, who asked that his last name not appear in print, said by phone on Monday.
The detained anarchists were later taken to four police precincts, although a reported thirty anarchists managed to escape when the police bus they were in got lost, and the police officers accompanying it were busy asking passersby for directions.

TITLE: California Hip-Hoppers Themselves to Play A2
AUTHOR: By Finn Cohen
PUBLISHER: The St. Petersburg Times
TEXT: Musicologists can easily put the various branches of American hip-hop’s family tree into a volume of categories: geography (East Coast, West Coast, “Dirty South”); fashion aesthetics (backpackers, bling, gangsta rap); and production values (slick Miami gloss, crunchy glitch-hop, old-school). They’d probably have a much harder time figuring out how to dissect Themselves, who perform at A2 on Thursday.
Jeffrey “Jel” Logan, and Adam “Doseone” Drucker are Themselves, a dark, giddy duo of MCs and producers from Oakland, California, who deliver intensely quick rhymes over paranoid, sinister beats and soundscapes, tying it all together with a strange ear for pop hooks.
Their concerts in Russia this week (they’re also performing in Moscow on Friday) will be their first in the country, brought here on a whim by Moscow promoter Savier Khmelevsky.
“I just found out that they were planning a tour [in Europe] and decided not to let the opportunity slip away,” explained Khemelevsky. “These guys haven’t played in six years and have never been to Russia, and they’re legends of underground hip-hop.”
After a six-year hiatus, Themselves have come back this year with two releases. The first, a free mixtape called “theFREEhoudini” available for download on Bay Area label Anticon’s web site (www.anticon.com), is a tremendous wallop to the head of rapid-fire rapping and spliced-together beats. Over a little more than 30 minutes, “theFREEhoudini” features rhymes from all seven founding members of the Anticon movement and multiple guests. Spliced between the various musical sketches are musique concrete-esque snippets of Doseone freestyling with a group of students from his freestyle rap class in Oakland (the MC is a formidable wordsmith, having once battled Eminem in a freestyle rap contest). As one continuous track, the release is dizzying to say the least, but multiple listens reveal intricate nuances in both the verbal and the instrumental deliveries. But even for native English speakers, being able to fully absorb the intense syntactical puzzles Doseone delivers is a challenge.
“I think that Russians will focus more on the music and the performance,” said Khmelevsky. “It’s true, Doseone is going to bring some incomprehensible ravings that might be hard to understand, but that’s not going to bother anyone.”
In the space between their last release, Themselves have stayed busy with various projects. 13 & God, their collaboration with German electronic act The Notwist, met with critical acclaim worldwide, as did their sextet Subtle, which utilizes a string section in addition to the trippy programming Themselves are known for. As if that’s not enough, Doseone and Odd Nosdam — who was supposed to appear at the Russian concerts as well but ended up being too busy to travel — were part of another seminal Anticon act, cLOUDDEAD. The next full-length release from Themselves, “CrownsDown,” will come out in August.
Live, there’s no telling what these artists will pull out of their multigenred hats, but it’s guaranteed that Petersburg is in for quite a lesson in rhyme skills, sample collage mania and some intense energy.
“As far as I know, Jel and Doseone are great showmen, so the concert should be really cool!” Khamelevksy said.

Themselves play with Flu Gi and Chaisnegrami at A2, Thurs., May 7. 12 Razyezhaya Ulitsa. Metro Vladimirskaya. 922-4510. www.a2club.su

TITLE: Several Kinks at Eurovision Contests Rehearsals
AUTHOR: By Anna Malpas
PUBLISHER: The St. Petersburg Times
TEXT: MOSCOW — Rehearsals for the Eurovision Song Contest kicked off at the Olimpiisky Sports Complex on Sunday, the first official day in the run-up to the competition, which begins May 12.
The stadium, which was built for the 1980 Olympics, has undergone a transformation, including what organizers promise is the most expensive Eurovision stage ever. The circular stage is surrounded by electronic screens for spectacular lighting effects, and high-tech disco balls hang from the ceiling.
“This is the most impressive stage I’ve ever seen. It’s fantastic,” Sweden’s entrant, Malena Ernman, said after her rehearsal.
There were a few teething problems evident on Sunday. Media representatives complained that they had to wait up to three hours for accreditation in an unclear procedure, and the stage director for Belarussian contestant Petr Elfimov hissed that projectors for a video backdrop weren’t ready on time.
This week will see intensive rehearsals by semifinal contestants. Countries with byes to the final round - Russia, France, Britain, Germany and Spain - will have their first rehearsal on Saturday. Organizers have put together a spacious media area, equipped with hundreds of computers, that would not look out of place at a prestigious international conference. Except, of course, for details such as the “no icream” sign at the entrance and scattered beanbags.
Elfimov of Belarus was one of the first performers to take the stage Sunday, performing a rock ballad called “Eyes that Never Lie.”
His rehearsal was jinxed by a technical problem, his Polish stage director, Janusz Jozefowicz, complained at a news conference, saying that a video projector failed to materialize.
The bleached-blond Elfimov confided after the rehearsal that he plans to wear his “lucky leather suit” for the show. He warbled in Belarussian at a reporter’s request and even attempted to get the news conference involved in a mass singalong, although no one could hit the high notes.
The Belarussian delegation handed out free ice cream with Elfimov’s grinning face on the wrappers. The treats proved popular, possibly because the on-site cafe was charging 150 rubles ($4.50) for a tiny salmon sandwich.
Swedish contestant Ernman performed a song called “La Voix” in a dramatic cream dress decorated with ostrich feathers. A well-known opera singer, she described herself as a “pop virgin” at the news conference.
Sunday’s audience included media representatives from France, Germany, Denmark, Turkey and Australia. They included devoted fans who have attended as many as 20 Eurovision contests.
Hassan Yusuf, editor of a British Eurovision fan magazine called Vision, said he’s attended seven competitions, although he started watching the contest back in the late 1960s. He’s backing the British entrant, Jade. “It’s my favorite since 1970,” he said. “I hope it’s going to do really, really well.”
About 50 fans from the British branch of an international network devoted to Eurovision will travel to Moscow for the contest, Yusuf said. He will spend two weeks in Moscow and estimates that it will cost him ?2,000 ($3,000).
“It’s an expensive hobby,” he said.

TITLE: Over Half 
Of Russians Slam State's Direction
PUBLISHER: The St. Petersburg Times
TEXT: MOSCOW — Less than half of all Russians believe that the country is headed in the right direction just a year after Dmitry Medvedev was elected president on promises to follow Vladimir Putin’s course, according to a new poll. 
As the economic crisis takes its toll, the number of Russians who believe that the country is moving in the right direction dropped to 43 percent last month, from 59 percent in May 2008 when Medvedev was sworn in, according to the poll by the independent Levada Center. 
Medvedev, Putin’s protege and handpicked successor, campaigned on a platform to maintain Putin’s policies as president, and he took office on May 7, 2008, after being elected with a landslide 71.25 percent of the vote. 
Putin’s presidency ushered in an era of rising living standards thanks largely to high oil prices. But oil prices have tumbled, leaving Medvedev’s Kremlin and the Cabinet of Prime Minister Putin struggling to piece together a package of anti-crisis measures. 
The crisis has also dented Medvedev’s and Putin’s approval ratings, which have fallen to their lowest levels over the past year, the Levada poll said.

TITLE: Passenger Accused of Trying To Bite Flight Crew Members
PUBLISHER: Combined Reports
TEXT: A Russian-born woman has been jailed in the U.S. state of Maine after purportedly consuming prescription drugs, wine and liquid soap from the lavatory and scuffling with flight attendants on a London-bound jetliner. 
U.S. prosecutors said Galina Rusanova, a British citizen born in Russia, punched and kicked flight attendants and at one point fell to the floor and began “snapping like a dog” while trying to bite a crew member’s leg. 
Rusanova, who made a court appearance Friday in Bangor, Maine, remained in custody pending a detention hearing Monday in U.S. District Court, where she is charged with assault and interference with a flight crew. If convicted, she faces up to 20 years in prison. 
The FBI said Rusanova went to Los Angeles to visit a man she met on the Internet and was returning Wednesday when her flight was diverted to Bangor. 
Several hours into the United Airlines flight from London to Los Angeles, Rusanova, who appeared to be drunk, began pestering fellow passengers and was speaking unintelligibly, the Bangor Daily News reported, citing court documents. A flight attendant then watched as she drank a container of liquid hand soap that was apparently from the bathroom, the report said. 
Rusanova subsequently became unruly and attacked passengers and flight crew members trying to restrain her. After falling to the ground, she began “snapping like a dog” and attempted to bite the leg of one of the crew members. “It’s typical of me. I sometimes do crazy things,” she told FBI agents, the newspaper said. 
Drunken passengers are involved in hundreds of onboard incidents each year on Russian airlines. In one incident in July 2004, three male flight attendants got drunk and beat up a passenger who complained about poor service on an Aeroflot flight from Moscow to Nizhnevartovsk.

(AP, SPT)

TITLE: U.S. Businessman Admits to Child Sex
PUBLISHER: Combined Reports
TEXT: A wealthy Russian-born entrepreneur has pleaded guilty in a U.S. court to sex crimes involving three minor girls from Russia.
Andrew Mogilyansky, a 38-year-old resident of Philadelphia, pleaded guilty traveling to Russia in 2003 to procure young teenagers from orphanages and have sex with them at his St. Petersburg apartment. Mogilyansky, arrested in December, is accused of recruiting the girls into an online-based child prostitution business in Moscow that he purportedly ran with several other people. 
If the plea is accepted, Mogilyansky faces six to eight years in prison for “sex tourism” and three related counts. If convicted of running a child prostitution ring, Mogilyansky faces 15 to 20 years in prison. The sentence is to be delivered July 30. Mogilyansky owns a car export business and runs a charity that solicits donations for children injured in terrorist attacks.

(AP, SPT)

TITLE: ‘Russia’s Obama’ Offers Change Kirov Can Believe In
AUTHOR: By Nadia Popova
PUBLISHER: The St. Petersburg Times
TEXT: KIROV — It’s only been four months since liberal politician Nikita Belykh became the governor of Kirov, but local businessmen say the difference is like night and day. 
Dubbed “Russia’s Barack Obama” by one magazine, Belykh is steaming ahead on fulfilling promises to cut red tape for small businesses and attract foreign investment to one of the most economically depressed regions in the country. 
Belykh, 33, keeps a blog, something unthinkable for his 65-year-old predecessor, requires regional officials to declare their incomes publicly and opened an anti-corruption museum that exhibits expensive gifts presented to officials. 
Local businessmen said while it might be premature to evaluate Belykh’s leadership, they were impressed with his openness and willingness to work like a partner rather than a governor. 
“The former governor and his team used to tell us not to interfere, while Belykh has invited us to talk,” said Igor Petukhov, chief executive of Lesstandart, a wood refining company. “This is more of a conversation between peers, and he doesn’t tell us to come one by one, as we used to before, but to come together and discuss our problems.” 
Belykh is the first outspoken member of the opposition to be appointed to an influential state post in years. President Dmitry Medvedev placed Belykh in the post in January, spurring hopes that the Kremlin might embrace a more democratic political landscape. Some opposition politicians say Medvedev’s democratic credentials are in doubt because of the ham-fisted mayoral election in Sochi last weekend and the ongoing trial of former Yukos CEO Mikhail Khodorkovsky. But Belykh’s governorship is seen by others as a test case, and his success in Kirov could lead to more liberal politicians receiving state posts. 
Belykh’s decision to accept the nomination attracted criticism from the liberal camp, but Belykh said in an interview that he has not changed his ideological outlook. 
“I understand that businesses have serious problems these days. Talking to them is a major part of my job now,” Belykh said in his office in downtown Kirov, about 900 kilometers northeast of Moscow. 

Cleaning Up Kirov
After Belykh came to power, some 200 officials left the regional administration. “Some of them left on their own, while others were fired,” Belykh said, explaining the shuffle as an effort to streamline the staff amid the financial crisis. 
Belykh, a former leader of the Union of Right Forces, a liberal party that was disbanded in November, has lashed out at bureaucracy on his blog, where he first floated the plan to create a museum for gifts worth more than 3,000 rubles given to his officials. Russian law forbids officials from keeping gifts worth more than 3,000 rubles ($91) for personal use. 
“People would be able to check how corrupt the officials are,” Belykh wrote on the blog. “You give an official a gift worth more than 3,000 rubles, then come to the museum in a month to check whether your gift is there. If it’s not, you go straight to the prosecutor’s office.” 
The museum is to open on the first floor of Belykh’s administration building this week. 
“To fight red tape, you have to begin with yourself,” Belykh said in the interview. 
He has amended a regional law to oblige officials to publish their annual tax declarations in the press beginning this week. “We are also working on a system of punishment for officials who provide false information in their public declarations,” Belykh said. 
To further distance himself from the previous administration, Belykh put up for auction the government car, a Lexus 570, bought for his predecessor, Nikolai Shaklein. The car, which cost 4.3 million rubles ($130,000), was to be auctioned off last Friday, but no bidders showed up, and the auction was postponed indefinitely. 
Hopes are high that Belykh will bring long-lasting change. 
“Kirov citizens are pinning as much hope on their new governor as the U.S. ... is on Barack Obama,” Expert magazine wrote on Feb. 2. “It is rare in Russia that a governor has come to power with such a bank of trust as Nikita Belykh. People expect a miracle from him, just like they do from Barack Obama.” 

Daunting Challenges
Belykh, however, faces serious problems ahead. The Kirov region, whose budget is 40 percent subsidized by Moscow, is expected to post a deficit of 3.7 billion rubles ($112 million) this year. Industrial production plummeted by 17 percent in the first quarter, while salary arrears soared by 700 percent. The Kirovo-Chepetsk fertilizer producer and about 2,200 timber mills, which are among the region’s biggest taxpayers, have seen their sales halve on average. 
Some military enterprises, the region’s pride in Soviet times, are in deep trouble. State-run arms producer Molot, based in the south of the Kirov region, has not paid salaries to its workers since November. 
Belykh said the problem at Molot was linked more to bureaucracy than the economic crisis. He said the Finance Ministry has calculated that the plant needs a cash infusion of 380 million rubles, but the firm’s management has refused to accept the money, saying it needs 450 million rubles to pay all of its debts and taxes and activate bank accounts frozen by the Federal Tax Service. 
“The last time I saw my salary was in November,” said Molot worker Yelena, 53, who asked that her last name not be published, citing fear of reprisals. “They have given us some food to cover part of the March salary — flour, sugar, vegetable oil, canned meat and rice.” 
Yelena, speaking by telephone from Vyatskiye Polyany, where the plant is located, said she would support Belykh as a politician only after he helped obtain the money from Moscow. 
Belykh said has he tried to help the plant, which produces carbines and sporting rifles, according to its web site. A plant spokeswoman said Molot also makes grenade launchers. 
“What I can do is bombard the Finance Ministry with letters and talk nonstop on the telephone,” Belykh said. “It’s just a matter of persistence and will to solve the problem.” 
The Finance Ministry’s press service was not immediately able to determine which department was dealing with Molot, and a spokeswoman said she received negative replies after making inquiries with several departments. 
Molot spokeswoman Diana Nazarova said the plant has suffered financial difficulties for the past two years because of a scarcity of orders, a shortage aggravated by the crisis. 
Molot’s problems started when the state did not buy arms that had been produced, Belykh said, adding that state defense orders from the Kirov region for 2009 amount to 1.7 billion rubles. 
“But it is all just on paper, while in reality Russian Technologies and other state-run defense companies don’t place orders with Kirov military enterprises,” he said, looking tired as he sipped black tea. 
“There are lots of problems to solve. I only sleep three to four hours a day,” Belykh said. “You may think it’s cool to be the governor of a region, but it’s actually a very tough job. Sometimes your body just can’t stand it.” 
Other liberal politicians said it would be difficult for Belykh to manage the region, where cronyism is widespread and civil society is underdeveloped. 
“It will be difficult to strike a political balance between Belykh’s new team and local officials and bureaucrats,” said Vladimir Ryzhkov, a former State Duma deputy. “Kirov has an extremely weak civil society and only nominal political parties with almost no democrats among them.” 
In the 2007 Duma elections, the Union of Right Forces received less than 1 percent in the region. 
“The previous governor was unable to come up with a clear strategy for developing the region, leaving his successor with the task of starting that job almost from scratch,” Ryzhkov said. 

Ex-Governor Replies
Shaklein, the former governor, brushed off criticism. “None of the businessmen ever complained about a lack of open talk with the governor,” Shaklein, now a Federation Council senator from the Kirov region, said Wednesday in an interview. “We fought corruption. ... I don’t agree with any of these accusations.” 
He said people always criticize former authorities when new leaders come to power. 
“Businesses thrived when we were in power,” said Sergei Sharov, Shaklein’s former deputy. He now owns a meat plant and advises Belykh on small business. “The number of small businesses increased by 1.5 times during the five years we were in power, through 2008, and tax revenues collected from small businesses rose by 3.4 times over that period.” 
Sharov said the administration assisted small businesses by opening 26 special centers where they could receive advice and file complaints about bureaucrats. 
“But we couldn’t control the towns’ local administrations,” he said. “The governor couldn’t fire them even if they treated businessmen badly.” 

Courting Investors
Belykh said he could cut the profit tax to support small businesses if they could prove that turnover would increase as a result. Several businessmen said they believed that they would come to an agreement with Belykh on dropping the tax. 
“It is easier for us to talk about the problems because we are from the same generation,” said Petukhov of Lesstandart. “Many businessmen in Russia today are in their 30s or 40s, so they don’t feel like they are on the same page as officials in their 60s who grew up in Soviet times.” 
He said local businesses had felt insecure under the previous administration. “You never knew what the administration would do to your business: close it, fleece it or torment it,” Petukhov said. “It was a real problem if an official’s business interests clashed with yours. 
“The officials who oppressed business are now keeping silent to see what the new governor will do,” Petukhov added. 
Belykh said he didn’t want investors to see Kirov as a Soviet backwater. 
“I want to change the image of the Kirov region, it’s too Soviet. In reality, however, it is not like that at all,” Belykh said, vowing to be especially open to foreign investors. 
“The situation with foreign investment is very bad in the Kirov region,” Belykh said. “We want to create a system of maximum convenience for them. The agriculture sector and transportation and logistics businesses are open for foreign investment. And the work force is among the cheapest in Russia.” 
Some foreign investors said Kirov has a lot of hurdles to overcome to attract their money. “The bureaucratic barriers are very high in Kirov,” said Andrei Metyolkin, chief executive in Russia for Teka Enterprise, a Spanish company that makes kitchen stoves in the Kirov region. “Besides, the infrastructure is terrible; there are simply no roads as soon as you leave [the city of] Kirov. But we hope the new governor with solve this problem.” 
The quality of 76 percent of the Kirov region’s roads is unsatisfactory, according to statistics provided by Belykh’s press office. The governor’s administration has earmarked 1.8 billion rubles to build and resurface roads this year, down from the 2 billion rubles previously planned, the press office said. Expert ratings agency ranks Kirov in 71st place in terms of investment potential among all of Russia’s regions.

TITLE: Markets Resist Impact of Swine Flu
AUTHOR: By Courtney Weaver
PUBLISHER: The St. Petersburg Times
TEXT: MOSCOW — During the ongoing economic crisis, the outbreak of a global flu epidemic would seem to be all it would take to put the nail in the world economy’s coffin.
Yet if signs from the end of last week are to be believed, the only real victim of the swine flu crisis may be Mexican pork sales, which dropped by as much as 85 percent, according to the country’s pork producer association.
While the virus has whipped the media into a frenzy, equities, including airline stocks, have appeared to be relatively resistant to the outbreak, with markets rallying on not-so-bad 2008 earning reports and buoyant oil prices that have remained comfortably more than $50 a barrel. 
A 2008 World Bank report says one of the sectors at greatest risk of disrupted service during an epidemic is the financial service industry, which could see activities such as currency and securities trading hampered seriously.
Following the SARS outbreak in 2003, the U.S. Treasury issued a stress test of the financial sector to determine its vulnerability to future epidemics. While the test may have better prepared the industry for swine flu, the ultimate trial this week will be how the markets handle the results of the most recent bank stress test there.
Details regarding the health of the 19 largest U.S. banks are expected to be announced Thursday, and the results may mark a turning point for market participants who have long struggled to determine the depth of banks’ bad assets.
A number of banks will probably be told that they have to raise additional capital, but markets so far have been responding relatively positively, said James Beadle, chief investment strategist at Pilgrim Asset Management.
“It seems that the markets are objectively in denial of bad news,” he said, despite the fact the U.S. Federal Reserve has already twice delayed the release of the results.
In this case, market participants may be reacting to the fact that banks are likely to have a relatively easy time finding capital and that at this point, all the banks have disclosed all their debts, said UralSib chief strategist Chris Weafer.
“What could have been a negative announcement three months ago may already be a positive one,” he said.
It has been said more than once during the economic crisis that when the United States sneezes, everyone catches a cold, and the idiom has induced even more eye-rolling during the onset of swine flu.
In terms of the stress test, however, U.S. actions might serve as a remedy for the rest of the world.
The Fed’s decision to raise capital requirements for banks could encourage other central banks to act similarly. In Russia’s case, this could mean the Central Bank will decide to speed up its own consolidation of the banking sector and reconsider raising its own capital requirements for banks as soon as this fall, Weafer said.
Despite jitters over a swine flu epidemic, markets weathered last week’s news relatively well after slight dips on exchanges on April 25, when news of the outbreak first hit.
The MICEX Index lost 2.2 percent on Monday trading, while the RTS Index fell 3.4 percent. The MICEX finished the four-day holiday trading week down 0.3 percent on Thursday at 920.4 points, while the RTS closed up 0.2 percent at 832.9 points.

TITLE: Russia Panned For Bans on Pork Imports
AUTHOR: By Maria Antonova
PUBLISHER: The St. Petersburg Times
TEXT: MOSCOW — Russia is facing widespread criticism for import bans on pork in response to the A/H1N1 influenza virus, also known as the swine flu, which U.S. officials and international organizations say has not been transmitted by food.
The World Health Organization said Saturday that there was no risk of infection from consumption of well-cooked pork and pork products, following similar comments in letters from the U.S. commerce secretary urging Russia and China to reconsider the restrictions.
The outpouring of criticism from international and U.S. health agencies appeared to put Gennady Onishchenko, head of the Federal Consumer Protection Service, on the defensive over the weekend. 
“Statements from WHO officials who have not provided the virus’s characteristics to state medical authorities are perplexing,” he told Interfax on Sunday. A day earlier, he said Russian scientists were ready to study the deadly strain of the virus once they receive it from their U.S. colleagues.
In a joint statement — signed by the Food and Agriculture Organization of the United Nations, the World Organization for Animal Health, and the World Trade Organization — the WHO said Saturday that there was so far “no evidence that the virus is transmitted by food” and “no justification … for the imposition of trade measures on the importation of pigs or their products.”
Since April 26, the Agriculture Ministry’s veterinary health watchdog has been restricting raw meat imports from countries and U.S. states with reported cases of the virus. On Wednesday, a commission chaired by First Deputy Prime Minister Viktor Zubkov decided to keep the bans in place until June 1.
In letters dated Thursday, U.S. Secretary of Commerce Gary Locke urged Finance Minister Alexei Kudrin and Economic Development Minister Elvira Nabiullina to request that the restrictions be lifted.
“Both the World Health Organization (WHO) and the Centers for Disease Control and Prevention (CDC) in the United States have stated that it is safe to eat properly prepared pork and pork products. The CDC has said categorically that the H1N1 virus is not transmitted by food. There have been no reports of the new H1N1 human influenza occurring in swine in the United States,” Locke wrote to Nabiullina.
“There should be no restrictions on trade without cause,” he wrote to Kudrin.
Bans on pork and chicken have been a sticking point in trade relations between Moscow and Washington. A letter was also sent to Chinese Commerce Minister Chen Deming. 
China and Russia account for 20 percent of U.S. pork exports.
“These moves have greatly disrupted all meat trade with Russia, creating tremendous confusion among exporters about product eligibility,” the U.S. Meat Export Federation said in a statement on its web site late last week.
In a troublesome sign for pork producers, Canada on Saturday confirmed the first case of the new virus in pigs. 
The Russian Agriculture Ministry’s health watchdog said Saturday that it was extending the ban on all meat imports from South Carolina and on pork imports from Spain and some Canadian provinces. The watchdog also said it might extend the ban on meat products from Canada and the United Kingdom.
As of Sunday, Russia has halted pork imports from 11 U.S. states, three Canadian provinces, Spain and nine Latin American countries. Additionally, all meat imports are banned from Mexico, California, New York, South Carolina and Texas.

TITLE: Medvedev Promises Increased Social Spending
PUBLISHER: The St. Petersburg Times
TEXT: MOSCOW — This year’s federal budget, along with the planned budget for 2010 to 2011, will be amended to strengthen spending on programs for social welfare and economic development, President Dmitry Medvedev told a group of lawmakers on Thursday.
“Despite the significant decrease in federal revenues, we have managed to not only preserve, but in some cases, actually increase social spending,” Medvedev said. “All social obligations must be fully met.”
The amendments, which the Kremlin press office said were signed into law on Wednesday, will increase spending on a broad range of programs, including pension programs and benefits, as well as projects for strengthening industrial demand, easing administrative pressure on business and revitalizing the national financial system.
Even those sectors that are not receiving more money under the amended budgets are still receiving more money than last year, Medvedev said.
“The current crisis is no reason to stop reforms,” Medvedev said. “It is crucial to modernize the social service, transport and communication infrastructure.”
He said education and health care would be a priority and the government would continue to develop the agricultural sector.

TITLE: N. Y. Judge Cancels Fines Imposed on Alfa Companies
PUBLISHER: Bloomberg
TEXT: NEW YORK — A New York Federal Court judge canceled the fines that were imposed on four companies controlled by Alfa Group as part of a dispute with Telenor, the Norwegian telecom said in a statement Thursday.
The fines were dropped after Alfa Group complied with the judge’s requirements that included reducing a stake in Turkcell Iletisim Hizmetleri and dismissing litigation by Ukraine’s EC Venture. 
The escalating fines threatened to cost Alfa $12 billion annually or lead to the loss of assets if it didn’t comply with all the requirements, according to Alfa’s Altimo unit. 
“We are happy that we have managed to restore corporate governance to Kyivstar through our legal efforts in the U.S. and look forward to running Kyivstar based on this common platform in the future,” Jan Edvard Thygesen, who heads Telenor’s operations in Central and Eastern Europe, said in the statement. Telenor holds 56.5 percent in Kyivstar, while Alfa Group owns a 43.5 percent stake via its Storm unit. 
Meanwhile, a Moscow court on Thursday postponed until May 6 the hearing of Norwegian telecoms firm Telenor’s motion to suspend the enforcement of a $1.7 billion award to VimpelCom, Reuters reported.

TITLE: In Brief
TEXT: <b>KazMunaiGaz Deal</b>
ALMATY, Kazakhstan — Kazakh state oil firm KazMunaiGaz struck a deal Thursday that will significantly boost its access to the Caspian Pipeline Consortium.
KazMunaiGaz will pay BP $250 million for its 49.9 percent stake in Kazakhstan Pipeline Ventures, which holds a 1.75 percent interest in the CPC. KazMunaiGaz already owns the remaining share of the venture.
KazMunaiGaz’s acquisition of Kazakhstan Pipeline Ventures will give it rights to ferry an additional 10.5 million tons of crude oil per year through CPC, the company said in a statement. (AP)

<b>Russia Slams Talks</b>
Russia sees no need to intervene politically to resume gas flows from Turkmenistan but finds it “disturbing” that Ashgabat is looking to the West for alternative energy partners, the energy minister said Thursday.
“For now, there is no need for political intervention in this process. The companies are now working out the issues among themselves,” Sergei Shmatko said, referring to talks between Gazprom and its Turkmen counterpart Turkmengaz.
“We find Turkmenistan’s newly restated priorities in the global energy sphere disturbing to some extent,” Shmatko said. (Reuters) 

<b>Russia No. 2 for Piracy</b>
WASHINGTON — China and Russia once again lead the list of countries with the worst record on preventing piracy and counterfeiting of U.S. goods, the U.S. Trade Representative’s office said on Thursday.
The International Intellectual Property Alliance, which represents U.S. copyright industry groups, estimates U.S. trade losses due to piracy of at least $3.50 billion in China and $2.77 billion in Russia. USTR put China on its watch list for the fifth consecutive year and Russia for the 12th. (Reuters)

<b>RusHydro to Sell Shares</b>
RusHydro said it plans to sell new shares totaling 19 billion rubles ($574 million) in value, the company said in an e-mailed statement Thursday. 
Shareholders will vote on the proposal at a general meeting on June 10. Each share will have a face value of 1 ruble, the statement said. (Bloomberg) 

<b>Sedmoi Offers Swap</b>
Sedmoi Kontinent said Thursday that it offered to pay 20 percent of a 7 billion ruble ($212 million) bond maturing in 2012 on June 23 of this year, when investors had an option to sell the debt back to the company. 
On that date, investors would also get a new two-year bond in exchange for the remaining 80 percent value of the 2012 debt. (Bloomberg) 

<b>For the Record</b>
Polyus Gold said profit dropped 40 percent in 2008 after a restatement of the prior year’s earnings, the company said Thursday.
(Bloomberg) 

Tatneft posted a 22 billion ruble ($665 million) loss in the fourth quarter after the ruble fell against the dollar and securities lost value during the global economic crisis. (Bloomberg)

Norilsk Nickel is seeking to extend repayment of a $3.5 billion loan used to buy LionOre Mining International in 2007, The Independent said, citing an unidentified source. (Bloomberg)

TITLE: Sechin Says EU Faces Supply Risks
AUTHOR: By Anatoly Medetsky
PUBLISHER: The St. Petersburg Times
TEXT: MOSCOW — Deputy Prime Minister Igor Sechin warned the European Union’s top energy official on Thursday that gas supplies to Europe through Ukraine could still break down because of limitations in the country’s pipeline system. 
Ukraine needs to buy 19.5 billion cubic meters of gas in the near future to make sure that flows to Europe remain uninterrupted, Sechin told EU Energy Commissioner Andris Piebalgs at the fourth EU-Russia Permanent Partnership Council on Energy. 
“If this is not done, the tragedy that we lived through in January will develop catastrophically,” Sechin said, Interfax reported. But Ukraine’s outdated transit network might be unable to handle the increased volumes, he said. 
The comments appeared to hammer home Russian frustration at initially being excluded from an EU-Ukraine agreement on modernizing the country’s energy infrastructure. 
Russia suspended exports through Ukraine for two weeks in January — leading to widespread shortages in Europe — after accusing Kiev of stealing “technical gas,” which is used to power transmission stations. Ukraine denied the charge. 
“I just want us to realize the existence of risks that continue to influence the gas transit situation,” he said. 
Piebalgs responded by urging against making a drama out of the problem. 
Ukraine usually fills its gas reservoirs in the summer to prepare for winter consumption peaks in Europe. 
The country pumped 800 million cubic meters of gas into storage in April, Prime Minister Yulia Tymoshenko said Thursday in Kiev. The statement came a day after she returned from Moscow, where she and Prime Minister Vladimir Putin agreed that Gazprom would pay an advance for transit fees to enable Ukraine to pay for the gas. 
Ukraine transports 80 percent of Russia’s gas sales to Europe. 
Sechin said Russia was ready to help Ukraine pay for some of the technical gas and that it was considering state loans to help. 
“When we say there’s a problem, we also propose a solution. We have even agreed to co-financing,” Sechin said. 
Sechin also brought up the Energy Charter, restating Russia’s disappointment with the treaty, which he said failed to regulate the dispute with Ukraine. 
Adopted in 1991 and signed by 49 countries and the EU, the charter sets energy investment, trade and transit rules. Russia signed it in 1994 but never ratified the treaty, and Putin suggested last week that Russia could withdraw its signature. “The Energy Charter treaty has proved nonviable,” Sechin said, according to excerpts of his speech on the Cabinet web site. 
Piebalgs ruled out a proposal by President Dmitry Medvedev to replace the charter with a new treaty that would provide greater security to producers and include the coal and nuclear power industries under its auspices. 
“The Energy Charter treaty will continue to live its life until the countries that established it decide differently,” Piebalgs told reporters.

TITLE: Budget for Forum Cut by 25 Percent
AUTHOR: By Jessica Bachman
PUBLISHER: The St. Petersburg Times
TEXT: The budget for the St. Petersburg International Economic Forum has been cut by a quarter this year, and foreign companies are being allowed to become sponsors for the first time, Economic Development Minister Elvira Nabiullina told reporters Wednesday. 
The three-day forum, Russia’s most important annual economic event, begins June 4, with President Dmitry Medvedev opening the plenary session on the second day with “his own assessment of the global economic situation,” Nabiullina said.
Last year’s forum — which, like this year, was officially sponsored by Gazprom — included lavish parties and high-profile entertainers, such as Pink Floyd legend Roger Waters. The St. Petersburg city government alone spent 716 million rubles (then $31 million) to help organize the event.
“This year, the budget for the forum has decreased considerably, but this is because operating expenses have dropped,” Nabiullina said, without elaborating. She also said the government had worked out a discount deal with St. Petersburg hotels for forum participants.
Last year, many businessmen, including Mirax Group chief Sergei Polonsky, complained loudly that the city’s hotels had jacked up their prices during the forum. 
Nabiullina said some 2,000 delegates were expected to attend, 300 fewer than in 2008. Already confirmed attendees include 600 Russian and foreign business executives and official delegations. 
Heads of state will also attend, and the president of the Philippines, Gloria Macapagal-Arroyo, has been the first to confirm her participation, Arkady Dvorkovich, Medvedev’s top economic adviser, said at the news conference.
Dvorkovich said many companies were “trying to work out deals” before the forum and that reporters could expect a host of announcements. He did not say whether the volume of the deals signed this year was expected to exceed last year’s $14.6 billion. 
The forum, now in its 13th year, has traditionally been the premiere event for Russian companies and foreign investors to announce and sign major partnerships. This year, it will also be divided into two parts: economic and financial, Nabiullina said.
The forum sessions and roundtables, many meditated by top government officials and CEOs of global corporations, will be “more democratic and interactive” this year, Dvorkovich said.
The forum will host closed dinners and meetings to grant the heads of major international companies direct access to Medvedev and First Deputy Prime Minister Igor Shuvalov, who oversees the country’s economic partnership with foreign businesses and governments. 
“We want to give everyone the opportunity to ask questions, to exchange experiences, to criticize and lay forth their opinions,” Dvorkovich said.

TITLE: MTV Mulling Introduction of More Channels
PUBLISHER: Bloomberg
TEXT: MOSCOW — Viacom’s MTV Networks International may introduce new services and channels in Russia as it develops its partnership with billionaire Vladimir Potanin’s Prof-Media, which owns the Russian version of MTV. 
“We want to offer a lot more of our brands,” Bhavneet Singh, MTV managing director and executive vice president for emerging markets, said in a telephone interview from London. 
MTV’s emerging markets group manages 30 television channels in Eastern Europe, Africa, the Middle East and India. The New York-based parent company says its brands reach 578 million households in 162 countries. 
MTV wants to expand in Russia by “building more presence with Russia-specific services across all available media platforms,” Singh said. This may include Comedy Central and Spike TV, he said. The company’s portfolio in Russia includes MTV, Nickelodeon and VH1.
Television is “best positioned to outperform” Russia’s declining advertising market, which may drop 20 percent this year, compared with 20 percent growth in 2008, according to a report by Renaissance Capital. 
The global advertising market is predicted to be unchanged this year from 2008, the report shows. Television’s share of Russia’s advertising market may rise to 55 percent this year from 49 percent in 2008, according to the forecast. 
Prof-Media paid $360 million in June 2007 to buy the Russian versions of music video channels MTV and VH1 to tap growing advertising sales. MTV is “unequivocally” committed to its partnership with Prof-Media, which operates the channels under a licensing agreement, Singh said. 
MTV has seen improved ratings since Prof-Media took over the license in 2007, Singh said. “A local partner helps us understand the audience better,” he said.

TITLE: VEB May Sell Bonds to Reorganize RusAl’s Debt
PUBLISHER: Bloomberg
TEXT: MOSCOW — Vneshekonombank may sell bonds convertible to stock in United Company RusAl to help reorganize a $4.5 billion loan, said Viktor Vekselberg, the metals company’s billionaire chairman. 
RusAl and Vneshekonombank, or VEB, are in talks on the debt, Vekselberg said in an interview with Russian newspaper Vedomosti published Thursday. 
Vekselberg spokesman Andrei Shtorkh confirmed the remarks. VEB declined by e-mail to comment on “ongoing talks.”
Vekselberg also said RusAl may move to reorganize the debt by selling its 25 percent stake in Norilsk Nickel worth about $4 billion at the stock’s current price. 
“The acquisition was a strategic investment for RusAl, and today we are not looking at sales options,” RusAl spokeswoman Vera Kurochkina said of the stake in comments e-mailed after the interview was published. 
The holding was used as collateral for the one-year loan, which is due in October.

TITLE: Cell-Dwellers Dig In For a War of Attrition
AUTHOR: By Matthew Collin
TEXT: The struggle for power in Georgia is now in its fourth week, with parts of Tbilisi under constant blockade. The opposition has established what it calls a “city of cells” — hundreds of imitation prison cells built from steel bars, rope and polythene sheeting — to seal off roads outside the parliament, the presidential residence and the state television channel. Opposition leaders say the cells, which symbolize the alleged authoritarianism of President Mikheil Saakashvili’s regime, will stay until the Georgian leader steps down. Saakashvili isn’t about to do that, so activists are settling in for war of attrition.
But one strange thing about the city of cells is how few people actually live in it. Daily rallies are poorly attended, usually attracting a couple thousand protesters, but far fewer are dedicated enough to brave the elements day and night for their cause. Their encampment also doesn’t have the flamboyant creativity of the tent city in Kiev during Ukraine’s Orange Revolution of 2004 or the courageous urgency of the youth activist camp that held out briefly but defiantly for a few days after disputed elections in Belarus in 2006. For most of the time, the serene atmosphere on the near-deserted streets of central Tbilisi is more like a public holiday than a political uprising.
But the cell-dwellers genuinely believe that they’re engaged in a battle of good versus evil. Lado, a middle-aged man who traveled from the Black Sea region of Adjara to join the protests, said he was a Saakashvili supporter during the optimistic early days of his presidency. “I was enthusiastic about Misha. He was clever, handsome, the youngest president in Europe,” he recalled. “I hoped the world would love him.” After a series of flawed elections and a disastrous war with Russia, that hope is long gone. “I’m not motivated by personal hatred,” Lado insisted. “Misha just didn’t do the right thing.”
Another middle-aged man, Gela, said this was an all-or-nothing struggle for the nation’s future. “If this protest ends in failure, we lose,” he argued. “There is no other choice left. We have no way back.”
This kind of rhetoric illustrates why compromise has been so hard to find. Opposition leaders simply don’t trust Saakashvili and say they’ll settle for nothing less than his resignation. The Saakashvili administration, which has allowed the protests to continue to prove that Georgia is democratic, can’t now remove the cells without appearing oppressive. With the situation in stalemate, each side awaits the other’s next move.

Matthew Collin is a journalist based in Tbilisi.

TITLE: Sochi’s Olympic Windfall
AUTHOR: By Sergei Guriev and Aleh Tsyvinsky
TEXT: Do the Olympic Games benefit the host country? It depends on whom you ask. Politicians and the overwhelming majority of citizens from the host country support the games, but economists often point out that the Olympics are a very expensive indulgence. 
At the Beijing Olympics, the opening ceremony alone cost more than $100 million. The Sochi Winter Olympics are expected to cost $10 billion in total. The expense of holding the games is rarely recouped by the host country. For example, economists calculate that the 1996 Olympics in Atlanta created slightly more than 24,000 jobs at a cost of $1.5 billion to the state of Georgia. That breaks down to an individual cost to taxpayers of $64,000 per new job. In addition, much of the infrastructure created to house the visitors and hold the events — stadiums, hotels and other buildings — frequently go unused or underused after the games leave town. Nonetheless, politicians often say that it is profitable to host major sporting events such as the Olympics or the World Soccer Championship because they put the country in the global spotlight and lead to new business opportunities.
Two weeks ago, Andrew Rose of the University of California at Berkeley and Mark Spiegel of the Federal Reserve Bank in San Francisco published their study “The Olympic Effect,” which examined the connection between a country’s hosting of the Olympics and its trade volume. The study used all currently available data and looked at countries that had made bids to conduct the games as well as those that actually hosted them between 1948 and 2004. It turned out that the positive effect of hosting the Olympics is significant. Countries that hosted the Olympic Games experienced a 30 percent increase in exports during the following years. That is an enormous dividend equal to the gains that could be expected from joining the World Trade Organization.
But showing a correlation between hosting the games and a subsequent increase in exports does not prove that the result was caused exclusively by the Olympics themselves. In fact, the reverse might be true: Countries that for one reason or another anticipate increased exports are most frequently awarded the right to host the Olympics. Or could it be that increased exports have nothing to do with the Olympics but are a result of an independent factor, such as the country’s greater economic transparency? Rose and Spiegel compared the hosting countries’ economies not with their previous status, but with the economies of the countries that had almost won their bids to host the games, but lost out in the final round. It turns out that those “losing” countries also showed the same gains in exports. 
Thus, this proves that hosting the Olympics alone does not directly lead to greater economic transparency. On the contrary, the data suggests that it is the competition to become the host of the Olympics — and a country’s need to prove to the world community that it is open and transparent — that causes the effect. It is no coincidence that China gained admission to the World Trade Organization not in 2008 or 2009, following its hosting of the Olympics in Beijing, but in 2001, when it first submitted its bid to host the games. Neither is it a coincidence that the 1964 Olympic Games in Tokyo coincided with Japan joining the International Monetary Fund the same year.
During the Sochi mayoral campaign, candidate Boris Nemtsov claimed that if incumbent Anatoly Pakhomov becomes mayor, Russia will not be able to carry out the Sochi Olympics efficiently. By promising to host the Olympic Games, however, Russia is sending a signal that the country is committed to integrating into the community of developed countries. The main economic effect from this declaration is that Russia is serious about creating a more open, liberal economy. To back out of its commitment to host the Olympics would result in tremendous losses, as Russia’s business partners and allies would no longer believe Moscow’s declarations about its liberal political and economic course. That is the threat Russia faces today. It stands to lose its good name, a colossal amount of resources spent for nothing and the chance to reap the economic effect of increased exports. 

Sergei Guriev is rector at the New Economic School and Aleh Tsyvinsky is a professor at Yale University and the New Economic School. This comment appeared in Vedomosti.

TITLE: Avoiding Another Lost Opportunity
AUTHOR: By Marshall I. Goldman
TEXT: Many historians make a living out of searching for “lost opportunities.” If only the Western Allies had not been so hard on the Germans after World War I, there is a good chance that Germany would not have suffered economically. And if post-World War I Germany had been more prosperous, Adolf Hitler and the Nazis would never had been able to win popular support and World War II would have been avoided. Or if the Allies had not insisted that tsarist Russia keep fighting in World War I despite enormous economic upheaval and military casualties, the Bolsheviks would never had been able to seize power. I can remember writing a term paper in junior high school that argued that if the United States had not tightened immigration quotas against Asians so drastically, Japan would never have bombed Pearl Harbor.
Such “what if” speculation almost always focuses on past disasters and is hard to prove. By contrast, critics seldom concern themselves with turning points in history that lead to positive results. But it is our good fortune that the United States and Russia may right now be pursuing a constructive series of such moves. I am referring to the first 100 days of Barack Obama’s presidency, during which he has made U.S.-Russian relations an important priority.
When U.S. Vice President Joseph Biden first mused that it was time for the United States to press the “reset button” on U.S.-Russian relations and Obama picked up the theme, everyone knew that was a brilliant way with two snappy words not only to criticize the administration of former President George W. Bush but also to signal to the Russians that it was time to re-examine relations between the two countries. It was intended to be a dramatic signal that the United States was about to embark on a radical shift in foreign policy. 
Only rarely in U.S. history does a new presidential administration veer sharply from the course pursued by its predecessor. Even when an election results in a change of political parties, there usually is considerable continuity in policies. An exception was the election of Franklin D. Roosevelt and his sweeping New Deal program. But that clearly is not the norm in most democracies, and even then it took an unprecedented depression to open the way for such a far-reaching change in direction, at least as it affected domestic economic policies.
Radical change may sometimes come more readily in nondemocratic societies, especially when they are in the midst of a serious economic or political crisis and this change is likely to be carried out by a dictator whose popularity is based on a promise to abandon the status quo and move instead to a more extreme, even opposite direction. The programs put in place by Hitler and Josef Stalin are two such examples of how calamitous domestic conditions can give birth to extreme upheavals in leadership and policies.
Yet democratically elected leaders on occasion can also promote far-reaching change without going as far as Hitler and Stalin did. This is possible even in what at one time were countries ruled by authoritarian leaders. Soviet President Mikhail Gorbachev and former Chinese leader Deng Xiaoping are examples of leaders of totalitarian societies who were able to carry out liberal reforms.
Obama’s re-examination of U.S. foreign policy is not confined to just our relations with Russia. He has also moved to relax U.S. restrictions on travel and trade with Cuba and to reopen a dialogue with Venezuelan President Hugo Chavez. To be sure, not everyone is happy with Obama’s course reversals. In particular, many right-wing critics are not happy with the way Obama is willing to work more closely with Russia. After Russia’s treatment of Georgia and Ukraine, Obama’s opponents have renewed calls to move ahead with the plans to install 10 missile interceptors in Poland and a radar system in the Czech Republic. 
For there to be real improvement in U.S.-Russian relations, the leaders of both countries would be well-advised to find ways in which they can work together to seek out policies that address their common interests, such as looking for remedies to reduce the severity of the economic recession (the United States has had a lot of experience here) or work together on addressing the threat of Islamic terrorism (Russia has had a lot of experience here.)
The two countries with two new leaders have an excellent opportunity to work together in ways that, until recently, were largely unthinkable. Differences certainly remain, but historians will judge today’s leaders by whether or not they can find ways to take advantage of the new challenges to overcome past divisiveness. It may be wishful thinking, but that seems more likely today than at any time since World War II.

Marshall I. Goldman, author of “Petrostate: Putin, Power and the New Russia,” is a senior fellow at the Davis Center for Russian Studies at Harvard University.

TITLE: IT Is Key to Russia’s Modernization
AUTHOR: By Nikolai Petrov
TEXT: The mayoral campaign in Sochi was full of surprises. Of course, it was not a “full-fledged political battle,” as President Dmitry Medvedev described it, but it was a significant improvement compared to mayoral races of recent years. Usually, the main challenge to the ruling party’s candidate — most often the incumbent — is either from the Communist Party or United Russia itself or a loyal candidate from the business community. 
In the Sochi race, however, the main contender was opposition leader Boris Nemtsov. His challenge was aimed not only at the local administration but also directly at the Kremlin. Contrary to the expectations of most observers, myself included, the Kremlin accepted the challenge. 
Russia’s election laws would have made it a simple matter to disqualify any undesirable candidate by citing a technical violation of the registration procedure. This is not difficult to pull off when the authorities control the electoral commission, law enforcement agencies and the courts. This means that the top Kremlin leaders approved of Nemtsov’s candidacy, particularly when you consider that the Sochi Olympic Games are Prime Minister Vladimir Putin’s precious pet project. 
A couple of weeks ago, candidates began dropping out of the race one by one. Some pulled out by their own accord and others, like wealthy businessman Alexander Lebedev, were disqualified by the election committee. It seemed that the ground was being prepared for Nemtsov’s removal as well. 
But Nemtsov never got the ax. Instead, the authorities initiated an informational blockade against Nemtsov, denying him the opportunity to meet voters in the venues of his choice and preventing him from advertising in the media while coverage of acting Mayor Anatoly Pakhomov dominated local television and newspapers. Pakhomov was portrayed less as a candidate and more as a successful, tireless leader, not unlike the way Dmitry Medvedev was portrayed during the presidential election campaign a year ago. 
The election was preceded by an intriguing series of liberal gestures from the Kremlin, including Medvedev’s interview with the editor-in-chief of Novaya Gazeta, his meeting with human rights advocates in the Kremlin and the early release of former Yukos lawyer Svetlana Bakhmina from jail. 
The Sochi election has become the focus of both national and international attention. Without a doubt, it is the most prominent election since the presidential vote in 2008. 
In the end, the Sochi vote will be indicative of where the Kremlin goes from here. On one hand, it wants to demonstrate a more liberal approach to domestic politics, and on the other hand, it wants to emphasize how much it controls by showing how easily its candidate can win against the most powerful challenger that the opposition has to offer. 
The Kremlin’s favored candidate was victorious despite the strong protest vote. The economic crisis and noisy conflicts between the administration and residents over the government’s heavy-handed, often illegal methods used to push through Olympic projects surely played a role in the election, but what is important is that on election day there were more voters who supported the Kremlin’s polices toward Sochi than those who opposed them. 
Lessons learned from the Sochi election will be useful to both the Kremlin and the opposition during the next round of elections in autumn. By that time, the mood of social protest in the regions will have reached the high temperatures we are now seeing in Sochi.

Nikolai Petrov is a scholar in residence at the Carnegie Moscow Center.

TITLE: Over-the-Top 'Producers' Brings in the Laughs
AUTHOR: By John Freedman
PUBLISHER: The St. Petersburg Times
TEXT: MOSCOW — Will wonders never cease? Anyone who has followed this newspaper’s arts pages even fleetingly will know that its theater critic is afflicted with a ghastly disease: He is utterly incapable of appreciating anything even closely resembling a musical. 
“There is nothing remotely entertaining,” he has been heard to grouse glumly, “about a bunch of hyperactive people dancing and crooning uncontrollably at the most inopportune times to the sappiest music ever concocted before everyone suddenly, though predictably, arrives at the obligatory happy end.” 
This generally has been considered an untreatable, occasionally even contagious, disorder. In any case, Said Critic has done his best to infect others with his bile. And then the miracle. Moscow’s Et Cetera Theater mounted a full-blown production of Mel Brooks’ “The Producers,” and Mr. Critic was seen not only leaning forward in his seat and not only smiling — he was actually seen laughing. Repeatedly. 
Is there any single social group that is not ridiculed in this absolutely manic musical? The story about a duo of two-bit producers mounting a guaranteed flop on Broadway in order to abscond with the investors’ money is potentially offensive to any and all. 
The two Jewish producers elect to stage a disgruntled Nazi’s play called “Springtime for Hitler,” and, in order to convince the author to sign over his rights, parade around with swastikas on their arms and sing Nazi songs with him. 
To ensure that this horrid play fails without fail, the producers hire a flamboyantly gay director who lacks talent but shamelessly will do anything if he is promised success. Women — not only in the guise of Ulla, the producers’ secretary who requires sex every morning at 11, but also in the guise of scantily clad dancing choruses — are objectified with glee. 
At least in the Russian version, which was created by translator-playwright Irina Lychagina and lyricist Alexei Kortnev, there are cripple jokes, ethnic jokes, political jokes, and we are only just getting started. 
One of the biggest laughs on opening night came during a police raid of the producers’ office. The terrified director of “Springtime for Hitler” hides in the bathroom then emerges to declare that someone was trying to “waste us in the outhouse,” a bull’s-eye reference to Prime Minister Vladimir Putin’s famous promise to deal with Chechen separatists. 
“The Producers” is so over the top, so insanely irreverent that it will make even a sorry-faced old critic double over in laughter. 
Director Dmitry Belov did a fine job of keeping this huge show running at a breakneck speed. His command of timing and pacing is particularly evident in the big scenes, which are built on the brief but explosive interaction of many different players.
As the producers Max Bialystock and Leo Bloom, Maksim Leonidov and Yegor Druzhinin, respectively, make a touching pair of misfits around whom everything else is structured. But it is the cavalcade of hard-core satirical portraits that really revs this production up. 
Natalya Blagikh is genre-perfect as the undulating, eyelash-batting sex bomb Ulla. Alexei Chernykh employs two parts Mick Jagger and two parts Boy George to create his hip-grinding interpretation of Roger de Bris, the pink-dress and boa-sporting director. 
Perhaps the funniest of them all is Roman Kirillov as Franz Liebkind, the sympathetically pathetic Nazi playwright, with whom Sigmund Freud clearly would have had a field day. This human knot of frustration and aggression is downright huggable. 

“The Producers” (Prodyusery) plays May 27 to 30 at 7 p.m. at the Et Cetera Theater, located at 2 Frolov Pereulok. Metro Turgenevskaya. Tel. 625-2161, 781-7811. www.et-cetera.ru. Running time: 3 hours, 40 minutes.

TITLE: Furious 
Berlusconi Demands Apology
AUTHOR: By Gina Doggett
PUBLISHER: Agence France Presse
TEXT: ROME — Italian Prime Minister Silvio Berlusconi on Monday demanded an apology from his wife for her public complaints over his roving eye and said their stormy marriage was heading for divorce.
“Veronica must apologise publicly,” the 72-year-old Berlusconi told Corriere della Sera newspaper as he went on the offensive in the couple’s public row.
“And I don’t know if that will be enough,” he said after press reports that Veronica Lario now wants a divorce from the billionaire media baron.
Lario, a 52-year-old former actress, last week issued an open letter complaining because Berlusconi chose many young women with no political experience to stand for his party in European Union elections in June.
One was a former Miss Italy contestant.
“It’s the third time she’s done this to me in the middle of an election campaign. It’s too much,” the flamboyant premier told the daily.
Asked whether the near 19-year marriage could survive, Berlusconi said: “I don’t think so. I don’t know if I want it to this time.”
Berlusconi told reporters Sunday: “This is a painful personal episode which should remain private, and it does not seem to me to be right to be talking about it.”
With a huge divorce settlement all but certain, the Italian press has begun totting up the Berlusconi family’s complex fortune built from a modest construction company into a sprawling media empire estimated by Forbes to be worth some 6.5 billion dollars (4.5 billion euros).
Berlusconi’s Fininvest empire includes three television channels teeming with game shows and soap operas featuring scantily clad starlets.
The couple, who have three children, are rarely seen in public together, while Berlusconi is a bon vivant known for his stamina at late-night dinner parties.
Lario was infuriated by her husband’s decision to attend the 18th birthday party in Naples last week for the blonde daughter of one of his business associates, media reports said. She complained because he never went to any of his own children’s coming-of-age parties.
“My marriage is over. I can’t stay with someone who cavorts with minors,” Lario was quoted as saying by one of her friends.
“I read in the papers about how he has been hanging around a minor — because he must have known her before she was 18 — and how she called him ‘Grandpa’ and about their meetings in Rome and Milan.
“This is no longer acceptable. How can I stay with such a man?” she was quoted as saying in La Stampa.
Berlusconi hit back, telling the same newspaper: “Madam says I’m running around with 17-year-old girls. It’s an assertion I cannot allow. I am friends with her father, that’s all. I swear.”
In January 2007, the one-time cruise ship crooner issued a public apology to Lario after she learned through the press of his verbal dalliance with a young lawmaker.

TITLE: Kuznetsova Downs No.1 Safina in Final
AUTHOR: By Ryland James
PUBLISHER: Agence France Presse
TEXT: STUTTGART, Germany — Svetlana Kuznetsova beat Russian compatriot and world number one Dinara Safina 6-4, 6-3 in Sunday’s final to win Stuttgart’s WTA tournament to bring an end to her losing streak in finals.
The fifth-seed needed just one hour and 19 minutes to beat the highest-ranked player in the world in straight sets to claim the winner’s prize of a new Porsche sports car.
Having beaten Olympic champion Elena Dementieva in Saturday’s semi-final, Kuznetsova finally broke her losing streak here having lost the last six finals she had reached on the WTA tour.
Kuznetsova changed both her coach and moved back to Moscow last year from Spain to train and the Stuttgart champion said the win here is proof she is on the right track.
“I changed so many things in the last year, pretty much everything you can change in your career, so this win is a good sign,” she said.
“I love being in Moscow, I love being back home, my soul feels at home in Russia.”
Having lost her last four matches against Safina, Kuznetsova said she knew she had to come out fighting or risk her fifth straight defeat at the hands of the world number one.
“The last time I played Dinara she nearly blew me off the court (in Moscow last year), so I knew I had to be very aggressive from the start,” said Kuznetsova.
“I had to keep my concentration throughout and focus to make sure I got the win.
“Now I am on a plane to Rome (for next week’s WTA tournament), so I hope for a bit of rest before my next game.”
The 23-year-old began in impressive fashion and needed only 43 minutes to take the first set and with Safina consistently over-hitting the ball, Kuznetsova had her first match point at 5-2 on her opponent’s serve in the second.
Safina defended the point, but it was only a matter of time before Kuznetsova won out and after serving to her second match point, an over-head smash gave her the title, her first since she won at New Haven in 2007.
But having turned 23 on Monday, Safina admitted she has plenty to work on ahead of Roland Garros which starts in three weeks.
“There was nothing in my racquet today,” she said glumly.
“I started the match too passively and that is something you just can’t do against a player like her. “I just didn’t use my shots and I didn’t really do anything to deserve to win this match.
“I tried to change a few things around as I had done against (Flavia) Pennetta (in the semi-final), but I couldn’t do it again.
“I wasn’t tired and in a way, it is a good test for me so close to the French Open to see what I need to work on.”

TITLE: Flu-Hit Mexico Mulls Reopening Businesses
AUTHOR: By David Koop
PUBLISHER: The Associated Press
TEXT: MEXICO CITY — Mexico was due to decide Monday whether to reopen businesses and schools or extend a shutdown that has helped choke off the spread of swine flu but caused untold economic harm. The virus continued to spread around the world, with new cases in Europe and North and South America.
President Felipe Calderon said a nationwide shutdown and an aggressive informational campaign appeared to have helped curtail the outbreak in Mexico. His health secretary said the government is starting preparations for the return to classes and work, and plans to give safety recommendations to businesses and disinfect schools on Monday.
“We have succeeded in detaining or at least slowing the spread of the virus precisely because the measures have been the correct ones,” Calderon said in an interview with state television broadcast Sunday night.
Health Secretary Jose Angel Cordova said the virus had killed at least 22 people in Mexico, raising the toll from 19, adding that the last confirmed death occurred April 29. He said the virus had sickened at least 568 people and apparently peaked in Mexico between April 23 and April 28.
While Mexico began its first tentative steps toward a return to normalcay, the virus spread to Colombia in the first confirmed case in South America, worrisome because flu season is about to begin in the Southern Hemisphere. More cases were confirmed in North America and Europe, with the total number sickened worldwide rising to at least 1,001 people, according to health and government officials.
Health officials raised the number of confirmed U.S. swine flu cases to 245 in 35 states late Sunday. The new number, up from 160 on Saturday, reflects streamlining in federal procedures and the results of tests by states, which have only recently begun confirming cases, said Dr. Anne Schuchat of the U.S. Centers for Disease Control and Prevention.
Officials in New Mexico announced that 14 schools in four towns were being closed for at least a week after the state’s first swine flu case was confirmed, and the New Mexico Activities Association suspended all athletic and activity programs until further notice at member schools across the state. California officials suspended all visitations at prisons pending results of tests on an ill inmate at Centinela State Prison.
In Alberta, Canada, officials quarantined about 220 pigs that became infected from a worker who had recently returned from Mexico. It was the first documented case of the H1N1 virus being passed from a human to another species. Canada stressed that pigs often get the flu and there is no danger in eating pork.
In Trinidad, crew aboard a Mexican tanker had been isolated since Friday at the Point Lisas Port. The Ministry of Health said Sunday that they were tested and cleared of any flu infection and that the vessel was expected to be released.
Hong Kong isolated 350 people in a hotel after a Mexican traveler there was determined to have swine flu.
China quarantined more than 70 Mexican travelers in hospitals and hotels there, and Mexicans on arriving flights were being taken into isolation, said Mexico’s ambassador, Jorge Guajardo. Even the Mexican consul in Guangzhou was briefly held after returning from a vacation in Cambodia, Guajardo said.
Calderon complained of the backlash against Mexicans abroad.
“I think it’s unfair that because we have been honest and transparent with the world some countries and places are taking repressive and discriminatory measures because of ignorance and disinformation,” Calderon said. “There are always people who are seizing on this pretext to assault Mexicans, even just verbally.”
The president did not single out any country. But the Foreign Relations Department said afterward that Mexico was sending a chartered jetliner Monday to bring back any citizens who wanted to leave China. A statement said the plane would go to several Chinese cities “where Mexicans have expressed their intention to return to Mexico.”
China’s Foreign Ministry denied it was discriminating against Mexicans.
The CDC’s acting chief, Dr. Richard Besser, said swine flu is spreading just as easily as regular winter flu.
“The good news is when we look at this virus right now, we’re not seeing some of the things in the virus that have been associated in the past with more severe flu,” Besser said. “That’s encouraging, but it doesn’t mean we’re out of the woods yet.”
Cordova said late Sunday that Mexico’s government would start distributing swine flu safety recommendations to businesses, but warned the national lockdown would not be lifted in one fell swoop.
The reopening “will not happen just like that,” Cordova said at a news conference. “There will have to be training, preparations for teachers and parents.”
Possible safety recommendations would be that there be a 2-meter (6.5-foot) distance kept between people in restaurants or theaters and that workers be urged to wear masks on the subway. He said a decision on whether to extend or end the business and school shutdown was expected Monday.
Cordova presented the most comprehensive description yet of the dead in Mexico, although no conclusions have yet ben drawn about how their characterics may have contributed to their deaths.
He said 15 were female and seven were men. One possible explanation could be that women get poorer health care in Mexico because of its male-dominated culture, he said.
Cordova also said only 4 percent were unemployed; the rest either had jobs or were housewives and students. More than 50 percent had not graduated from high school and only 11 percent had university education.

TITLE: O'Hair Scores Win at Quail Hollow Tournament
AUTHOR: By Doug Ferguson
PUBLISHER: Agence France Presse
TEXT: CHARLOTTE, N.C. — Tiger Woods was the last person Sean O’Hair wanted to see.
It was Monday at the Masters, just eight days after O’Hair squandered a five-shot lead and watched the world’s No. 1 player celebrate at his expense.
“I was playing a practice round and I saw Tiger, and he looked over and I kind of nodded, and he said something. And I’m like, ‘That son of a (gun),’” O’Hair said with a laugh.
It was a reminder of everything that had gone wrong at Bay Hill.
They ran into each other again Sunday evening at the Quail Hollow Championship, the circumstances entirely different.
With a dozen players in contention on a course that felt like a major, O’Hair was the only one in the final nine groups to break 70. As one player after another failed to capitalize on birdie chances, O’Hair came through with a tough two-putt birdie from 70 feet on the 15th hole, followed by an 8-iron to 8 feet for birdie on the 16th.
That enabled him to close with two bogeys on the two toughest holes at Quail Hollow, giving him a 3-under 69. It held up for a one-shot victory when Lucas Glover’s birdie chip from behind the 18th green trailed off to the left.
Woods was still outside the clubhouse when he saw O’Hair, enough time for a quick embrace and to offer congratulations.
“It was cool that he came up and did that,” O’Hair said.
This was a reminder of how far O’Hair has come in such a short time.
Five weeks after that collapse, the 26-year-old was determined to keep putting himself into contention on the back nine Sunday until he figured out how to win down the stretch.
The time came Sunday at Quail Hollow.
O’Hair rallied from a three-shot deficit for a one-shot victory over Glover (71) and Bubba Watson (70), with Woods in his rearview mirror throughout the back nine.
Woods finished with 10 straight pars, including a three-putt from 25 feet after driving the par-4 14th green. He wound up with a 72 to finish alone in fourth, two shots behind.
O’Hair has a history of not folding. He was driven by a relentless father and forced to turn pro when he was 16, still a junior in high school. He managed to break away, got married, and he and wife Jackie traveled the mini-tours in a 40-foot bus, sometimes unable to play because they didn’t have money for the entry fee, often playing for their next meal.
“Losing (stunk) at Bay Hill,” O’Hair said. “Even though it’s tough to lose like that, to lose a five-shot lead against Tiger, you still learn from it. I talked to my coach. I talked to my caddie, Paul (Tesori). And we just all said all I have to do is keep putting myself in those situations, and at some point I’m going to learn how to win. It’s just nice to win as quickly as I did after Bay Hill.”
It wasn’t easy.
Even with a shaky swing, Woods’ presence loomed at Quail Hollow. He spun back a delicate pitch shot to tap-in range for birdie on the eighth hole to get within one shot of the lead at the time, and appeared to be hitting his stride.
Instead, he hit it into the trees on the par-5 10th, eliminating a good chance at birdie. And he kept coming up well short of the pin, unable to produce the right trajectory for the wind.
But nothing stung worse than the 14th, with fans waving white towels at the sight of his ball tumbling down the fairway and stopping just inside 25 feet from the cup for a chance at eagle, with a par 5 awaiting on the next hole.
Woods ultimately had to make a 5-footer just to save par.
“I had my opportunity there at 14. I made a mistake there,” Woods said. “I knew the green was baked out. It was downwind, and I didn’t heed my own warning, and ended up putting too hard.”
Birdies are rare on the final three holes, known as the “Green Mile,” and both the runner-ups dropped a shot along that stretch — Watson at the 16th, Glover at the 17th.
If there was a key shot for O’Hair, it came at the 16th. He blistered a tee shot, then hit 8-iron into a stiff breeze just over the bunker to about 8 feet away and a birdie that gave him a two-shot lead.
“I just hit it as hard as I could and tried to flight it,” O’Hair said, “and hit really a perfect golf shot.”
And it was the perfect ending.

TITLE: South Korean Warship Rescues N. Korean Vessel
AUTHOR: By Hyung-Jin-Kim
PUBLISHER: The Associated Press
TEXT: SEOUL, South Korea — A South Korean navy warship warned Somali pirates away from a North Korean freighter Monday by threatening to open fire, the South Korean military said.
South Korea’s Joint Chiefs of Staff said in a statement that the 4,500-ton-class warship sent a Lynx helicopter to assist the North Korean vessel earlier in the day after receiving a distress call that it was being chased by the pirate ship.
The pirate ship gave up chasing the North Korean vessel and sped away shortly after snipers aboard the helicopter prepared to fire warning shots at it, the statement said.
The South Korean helicopter guided the North Korean ship to a safer area and the ship later sent a thank you message to the South Korean vessel, the statement said.

TITLE: Ferrari Attacks 'Unfair' Budget Cap on Formula 1
PUBLISHER: The Associated Press
TEXT: LONDON — Ferrari has accused Formula One’s governing body of damaging the sport with the planned introduction of a voluntary budget cap, in letters sent to the FIA by president Luca di Montezemolo.
In cost-cutting measures announced Thursday, the World Motor Sport Council said teams who accept a $59 million cap will be given more technical freedom next year.
But in a letter to FIA president Max Mosley published Friday by British newspapers, Di Montezemolo said it would create a “fundamentally unfair” world championship.
F1 has 10 teams with two cars each, but that will be increased to up to 13 teams and 26 cars in 2010. The WMSC is also banning refueling during races.
Di Montezemolo said the system will split teams into two groups — those who operate on a limited budget with fewer technical restrictions, and those who keep spending perhaps more than twice as much but with less freedom.
“There are doubts as to whether or not two categories of teams should be created, which will inevitably mean that one category will have an advantage over the other and that the championship will be fundamentally unfair and, perhaps, even biased,” Di Montezemolo wrote.

TITLE: Madonna Adoption Case Heard Amid Dispute
AUTHOR: By Raphael Tenthani
PUBLISHER: The Associated Press
TEXT: BLANTYRE, Malawi — Malawi’s highest court began deliberating on Madonna’s bid to adopt a 3-year-old girl from the southern African country, as a dispute erupted over whether a man trying to stop the proceedings is the girl’s father.
Madonna was not at Monday’s closed-door hearing at the Malawi Supreme Court of Appeal, and a ruling may not be announced for several days.
The 50-year-old pop star is fighting a lower court’s decision that she cannot adopt Chifundo “Mercy” James because she had not been screened over time by Malawi authorities. The court said the rules were bent when Madonna adopted her son David from Malawi last year.
Madonna’s Malawian lawyer Alan Chinula said he was “hopeful” the appeal would succeed, and argued the lower court had relied on outdated law to block the girl’s adoption.
Madonna found the girl in 2006 at Kondanani Children’s Village, an orphanage in the southern town of Bvumbwe just south of the commercial capital of Blantyre. It was the same year she adopted David, whom she found at another orphanage in the central Mchinji district.
On Sunday, a man told The Associated Press he was the girl’s father, and has sought help from the Malawi Law Society to stop the adoption.
James Kambewa, a 24-year-old a security guard, acknowledged he has never seen the child, who according to court documents was placed in the orphanage when her 14-year-old mother died a few weeks after giving birth to her.
But Kambewa said he now wanted to claim custody of Chifundo.
“I may be poor, but I think I have what it takes to raise a daughter,” he said. “I will fight the adoption.”
The brother of the girl’s mother told the AP the family does not know Kambewa.
“How can he claim he is the father when he hasn’t been around all this time?” said Peter Baneti, who explained that the girl was put in the orphanage because there was no one to breast-feed the baby.
Baneti said he had agreed to the adoption on behalf of the family, and that Kambewa was “just an opportunist.”
Madonna spokeswoman Liz Rosenberg said in an e-mail message she doesn’t know if Kambewa is the father.
“All I know is that Mercy has been in an orphanage since the day she was born,” Rosenberg said.
Kambewa, in an interview to be aired Monday on CBS’ “The Early Show,” said he has only seen the girl “in newspapers and TV — not face to face.” But he told CBS the girl “is a Malawian — so (I) need her to grow as a Malawian as well with our culture.”
On the show, Kambewa wore a necklace bearing the girl’s name.
Madonna has founded a charity, Raising Malawi, that helps feed, educate and provide medical care for some of Malawi’s more than 1 million orphans, half of whom have lost parents to AIDS.

TITLE: Russia Destroys
Latvia 6-1
AUTHOR: By Graham Dunbar
PUBLISHER: The Associated Press
TEXT: BERN, Switzerland — Russia routed Latvia 6-1 on Sunday, sealing a spot for the United States in the world hockey quarterfinals.
With Russia already assured of top spot in the six-team Group E and No. 1 seeding in the quarterfinals, its latest victory resolved some issues among a logjam of four teams fighting for three places.
Sweden, Latvia and the United States all have seven points, with the Swedes earning a spot with a 4-1 victory over Switzerland.
Latvia’s loss to Russia in its final group match means it cannot edge the U.S. by virtue of the Americans’ 4-2 win when they met in a first-round match April 25.
Switzerland has four points and must beat the United States in regulation time Monday to earn the three points it needs to send the Latvians home.
There’s a kicker for the United States, too. Although it is certain to advance, a loss in regulation to the Swiss would almost certainly mean coach Ron Wilson’s side would face Canada in the quarterfinals.
“I think the team we lost against (Sunday) will be the world champions,” Latvia coach Olegs Znaroks said of the Russians.
Znaroks, who hid his face rather than watch his underdog team’s two shootout victories at this event, said he would be unable to bear the tension of watching the Switzerland-U.S. match on television.
Russia played the best hockey of the championship in beating the United States 4-1 on Saturday — overturning an early U.S. lead to score four times before 22 minutes had been played — and was ruthless again Sunday.
“The motivation was pretty difficult and I would like to congratulate my players,” Russian coach Slava Bykov said through a translator.
Defenseman Oleg Tverdovsky and forward Anton Kuryanov both scored twice and Ilya Kovalchuk had an assist for his team-leading 10th point.
Russia will play Belarus in the quarterfinals. Belarus got the No. 4 seed in Group F by losing 3-0 to the Czech Republic in Sunday’s late match in Zurich.
The Czechs, who got two goals from Petr Cajanek, will finish third behind Canada and Finland, who complete group play on Monday.
Canada needs only to avoid defeat to the Finns in regulation to seal a No. 1 seeding, after eliminating Norway with a 5-1 win Sunday.
Steve Stamkos scored his tournament-leading sixth goal, and Matt Lombardi, Dan Damhuis, Jason Spezza and Drew Doughty added the others.
Canada is the only country to earn maximum points. Russia has won five matches in regulation, but needed overtime to beat Sweden 6-5 on Thursday.
In relegation round play Sunday, Austria beat Germany 1-0 and Denmark defeated Hungary 5-1.

TITLE: Dusseldorf Attracts With Heady Mix of Beer and Castles
AUTHOR: By Irina Titova
PUBLISHER: The St. Petersburg Times
TEXT: Coming in to land above Dusseldorf, it is surprising how densely populated the city’s outskirts are for miles around. Red-roofed houses stretch out into the distance between well-groomed fields.  Forests, though, are few and far between, at least in comparison to Russia.
Dusseldorf, the capital of North Rhine Westphalia, Germany’s most populous region, is one of the country’s largest centers for business, shopping and nightlife.  The city’s beauty and the history make it a must-see for any tourist.

GERMANY’S BUSINESS CENTER
On weekday mornings, scores of cars make their way into Dusseldorf from outside the city.  Every day, Dusseldorf’s population of 585 thousand is supplemented by about 200 thousand commuters from the surrounding area.  Many even make the trek from Cologne, around 40 minutes drive from Dusseldorf.
In the recent decades Dusseldorf has earned itself a reputation as one of Germany’s biggest business centers, and over 100,000 German and international companies have a presence in the North Rhine Westphalia region, including at least 21 of 50 German biggest companies. An astonishing 20 percent of German GDP is based in the city. About 18 million people live within a 100-kilometer radius of Dusseldorf airport. 
In fact, today, Dusseldorf’s GDP is ranked third amongst European cities, behind only London and Paris. A study conducted by Lufthansa ranks Dusseldorf seventh among the world’s strongest economic regions, squarely ahead of Chicago and Frankfurt.
The fact that Dusseldorf International airport is Germany’s third-largest comes as no surprise, then, and at least 40 percent of these air-travelers come to Dusseldorf for business purposes.
Often, businessmen come to Dusseldorf for a single meeting.  To cater for this market, there is a large four-star Sheraton hotel conveniently locate right by the airport.
“Often businessmen come and meet right here, in one of our hotel’s many conference rooms.  They have their meeting and fly straight back home.  That’s how it usually works here,” explained Mr. Reismann, the hotel’s General Manager.
Another factor in Dusseldorf’s success as a business destination is its many international fairs – the city is home to 40 such international festivals.
Meanwhile, Dusseldorf is also considered one of the best world cities to live in.  Recent research by Mercer Human Resource Consulting placed Dusseldorf sixth in terms of quality of life.
In recent decades Dusseldorf has become a popular tourist destination, with three million people staying in the city’s hotels in 2008, and many millions of visitors coming to the city each year.

SIGHTSEEING
The first documentary reference to Dusseldorf dates back to the 12th century, and unsurprisingly, the city is positively brimming with history. The Burgplatz, or City Square, located in the city’s Old Town, is a particularly exciting place to spend some time, with the imposing Gothic architecture of Lambertus Church and Castle Tower, old-style houses, and a fountain adorned with a sculpture of two boys cartwheeling.  
In years gone by, cartwheeling was the favorite party-piece of Dusseldorf‘s children, who used to perform their acrobatics in the hope of earning a little pocket-money. The tradition remains alive to this day, and every year children take part in cartwheeling competitions held in the city on June 21.  The custom began 700 years ago, when local children jumped for joy after the Dusseldorfers’ victory against Archbishop of Cologne near Worringen in 1288. Today the cartwheeler is a much-loved mascot for the metropolis on the Rhine and its living traditions.
Fittingly, the monument to Dusseldorf’s victory at Worringen stands just next to the Cartwheelers’ Fountain.
The Burgplatz also opens onto a magnificent view of the Rhine River and offers a broad panorama of the old and new quarters of the city.  The view from Burgplatz is particularly impressive at night, when the whole city is illuminated, topped off by the glittering Rheinturm, the city’s 240.5 meter-high TV-tower.
The Burgplatz leads onto Dusseldorf’s promenade, constructed in 1995 to alleviate traffic congestion.  There are pedestrian paths running for two kilometers along the river, and cycle paths can be found nearby.  The Rheinufer Promenade has become a popular meeting place, its main attraction being bars offering beer gardens and terraces.  It is also a glorious spot to come and watch the sun set over the river.
Walking along Burgplatz and Rheinufer Promenade visitors are greeted by lovely modern sculptures of local residents, including a young couple and a woman with a young child.  The series of sculptures, designed by local artist Christoph Poggeler, is entitled ‘column saints’.  Life-sized, dressed in modern clothes, they stand on pedestals and lend a charmingly homely atmosphere to the city.  
Another must-see is the city’s historical Market Square or Marktplatz.  Surrounded by the historical buildings of the city administration, its focal point is the equestrian statue of Jan Wellem, prince-elector of the Holy Roman Empire.  Around Christmas time the Marktplatz is transformed into a vivid market in the glow of a thousand lights, just like the majority of the Old Town’s streets.
 The city has good memory for its historical worthies.  By the city’s historic Andreas Church is the mosaic portrait of Johanna Ey, who founded the city’s art gallery before the Second World War.  The gallery exhibited the works of future famous German artists and contributed to many a career.
Dusseldorf is also known for its fine gardens.  Hofgarten is the jewel in the crown, with its charming little bridges and wide variety of birds, including swans.  In spring and summer when the trees are in blossom, Hofgarten is the perfect refuge from the hustle and bustle of the city center. 
At the same time, historic Dusseldorf offers impressive modern architecture, especially in the Media Harbor area.  The promenade leads onto the city’s most recent significant urban development, the conversion of parts of the former Rhine harbor into a center for media and creative businesses.
Side-by-side with protected industrial monuments, internationally-renowned star architects such as Frank O. Gehry, David Chipperfield and many others have positioned office buildings of outstanding design. 
These new buildings may look surreal but they are in harmony with contemporary lines of the district, as well as with the unusual multicolored sculptures of men climbing up another nearby modern building.  Locals say there are still discussions in the city as to whether these sculptures constitute ‘art’ or not, but one thing is for sure: they certainly attract attention.  The area is also a hive of hotels, trendy restaurants and lively bars.

CASTLES
Germany is famous for its delightful and intriguing castles.  A visit to Dusseldorf is the ideal opportunity to explore this part of German history - there are even several castles within the city’s suburbs. 
One of them, Schloss Benrath, is to be found in the city’s Benrath suburb.  Completed in the early 1770s, the castle overlooks on a riverbank in the grounds of a beautiful park and was once home to Prince Carl Theodor von Pfalz-Sulzbach.  Today it houses some of the prince’s personal art collection, as well as 18th century furniture, the National History Museum, and the Museum of European Garden History.
Also worthy of note is Barbarossa’s medieval fortress, once one of the most important castles on the Rhine.  The mighty remains of the castle are more than 50 meters long and 14 meters high, and its walls are an impressive four and a half meters thick in places.
Other well-known castles including Moyland Palace, the Burg Palace on the Wupper, Rheydt Palace, Linn Castle, and the fortified town of Zons are also within a stone’s throw of Dusseldorf itself.

SHOPPING AND NIGHTLIFE
Dusseldorf can definitely boast of being one of Europe’s biggest shopping and nightlife centers.
The famed Konigsallee showcases the international fashion scene in designer boutiques and shopping malls. Lovingly referred to as ‘Ko’ by locals, Germany’s most sophisticated mile is considered one of the world’s grand luxurious boulevards.
Neighboring streets offer a whole variety of middle-range brand stores such as H&M, Mango, Zara, Esprit, Mexx, Sacha Shoes, KULT, Carsh Haus, and many more.
Meanwhile, nightlife devotees can have a blast in the city’s Old Town, known as “the longest bar in the world” thanks to its 260 restaurants and inns, pubs, rustic breweries and cafes - all of which are crammed into a single legendary square kilometer right on the banks of the Rhine.
The nightlife of the city continues into the wee hours with people flowing from one bar to another sampling all kinds of traditional German beer.  Inventive landlords have installed patio heaters under the huge umbrellas of their outdoor seating areas to cope with the colder nights.
Germany is known for the more than five thousand sorts of beer produced in the country. Each area or town prizes its own recipe, and Dusseldorf, home to the Altbeer, is no exception. Nowhere else does this premium beer taste as delicious as in its historic home breweries. One of the most famous is called Uerige.
Even on weekday evenings, Uerige is full to the brim with people savoring the dark, mellow, bitter Altbeer.  Its traditional accompaniment of German roast pork and potato salad with spicy mustard gravy is gloriously tender and mouthwatering.
Dusseldorf’s other famous drink is Killepitsch.  This fine liquor is made of 98 kinds of herbs, berries and fruits, and is reputed to be very good for digestion, especially in conjunction with nourishing and delicious German food.  To this day the recipe is a tightly-guarded Busch family secret. Killepitsch is one of those drinks that every tourist should take home as a souvenir.

HOTELS
Dusseldorf’s hotels run the gamut from glamorous five-star affairs to more affordable three- and two-star establishments.  In all there are over 150 hotels in the city. Prices are reasonable, with some four-star hotels offering rooms for under 70 euros, and some five-star hotels costing less than 100 euros per night.  Two-star hotels start from around 50 euros and a three-star room will set you back around 60 euros.  Prices do, however, increase for the international fairs.
One of the city’s top hotels is without doubt the Breidenbacher Hof.  Located on Konigsallee in historic downtown Dusseldorf, Breidenbacher Hof combines modern amenities with the rich traditions and heritage of the past.  Over its near-200-year history, Breidenbacher Hof has played host to many famous guests including Czar Alexander II and Prince August of Prussia.  The hotel reopened in May 2008 after extensive reconstruction.
The architecture of the new Breidenbacher Hof with its light, natural stone facade is a conscious nod to the classical styles of other European grand hotels.  The 79 generous and luxurious guest rooms and 16 exquisite hotel suites offer their guests every conceivable comfort. 
The hotel can also boast of excellent cuisine served at its Brasserie 1806 restaurant.  The restaurant’s bright young head chef Michael Reinhardt uses fresh, regional ingredients to create local and international cuisine - his wild garlic and asparagus soup leaves unforgettable impression. 
More information online at: www.breidenbacherhofcapella.com
The Sheraton Dusseldorf Airport Hotel offers 200 air-conditioned rooms with triple-glazed noise-insulated windows.  It also offers 14 partially partitionable and eight convertible conference rooms, as well as two excellent restaurants.  Prices start at 100 euros per night.  The commute to downtown Dusseldorf takes about 15 minutes by car.
More information online at: www.sheraton.de/dusseldorf 

FLIGHTS
Today, traveling to Dusseldorf from St. Petersburg has become very convenient and inexpensive, thanks to Lufthansa’s new daily direct flights from Pulkovo to Dusseldorf (currently 2,960 rubles return, not including taxes).
More information & booking details can be found on the website of the Dusseldorf Tourist Board: www.visitduesseldorf.de