SOURCE: The St. Petersburg Times
DATE: Issue #1484 (46), Friday, June 19, 2009
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TITLE: Medvedev, Hu to Speed Up Talks On Gas
AUTHOR: By Anatoly Medetsky
PUBLISHER: The St. Petersburg Times
TEXT: MOSCOW — President Dmitry Medvedev and his Chinese counterpart Hu Jintao agreed on Wednesday to revitalize gas-trade talks between the giant neighbors in a step that may lead to Gazprom taking out a loan from China to deliver the fuel. 
Medvedev and Hu signed a memorandum of understanding to cooperate in natural gas, as well as agreements covering coal and equipment trade, at a Kremlin ceremony that crowned the Chinese president’s visit to Moscow. 
At a subsequent news conference, Medvedev said a landmark loans-for-oil deal that the countries signed earlier this year sets the pattern for gas trade as well. 
“I think the use of that experience can bring good results,” he said without elaborating. 
As part of that deal, Rosneft agreed to sell oil to China for 20 years starting in 2011 and was allowed to draw a $15 billion loan from the Development Bank of China. 
Hu said at the news conference that it was “important” to speed up the gas talks. Gazprom and the Chinese National Petroleum Corporation have discussed opportunities for supplies from Russia to China since 2004. 
Gazprom deputy chief Alexander Ananenkov said separately Wednesday that the company had been unable to agree with the Chinese side on prices in their ongoing negotiations. 
Government officials from Russia and China will meet for consultations on gas trade in October, when Prime Minister Putin is scheduled to visit China, Deputy Prime Minister Igor Sechin said after the Kremlin talks. 
“We expect the first results of the memorandum to appear by then,” he said, Interfax reported. 
Gazprom has had little, if any, progress in trying to sell its gas to China since it signed a strategic partnership agreement with CNPC as part of then-President Vladimir Putin’s visit to China in 2004. Things appeared to have moved nowhere after the two companies signed a tentative protocol on price and other terms of deliveries in March 2006. 
Gazprom, which insisted on a price that would bring it the same revenues as its sales to Europe, may now have changed its mind, said Vitaly Gromadin, an analyst at the Arbat Capital brokerage. What may be dampening its revenue expectations is a rival pipeline that is being constructed to deliver likely cheaper gas from Turkmenistan to China, he said. 
Gazprom is also suffering a bitter setback from a steep decline in demand at home and in Europe, which may have prompted it to set out on a more vigorous search for alternative markets. 
“Gazprom may have softened its stance in the talks because it’s in an unenviable situation at the moment,” Gromadin said. 
If Gazprom gets a loan from China, it may spend the money to develop the east Siberian fields and construct a pipeline to that country, he said. 
A memorandum of understanding signed Wednesday for cooperation in the coal industry stipulates the joint development of coal fields and the construction of coal-powered electricity plants in China, Sechin said. 
Medvedev and Hu also signed a memorandum of understanding to encourage trade in greater value-added goods such as equipment and high-tech products. They also signed a plan for investment cooperation, but the Kremlin gave no details of the document. 
After the presidents met, China National Gold Group signed a cooperation agreement with billionaire Viktor Vekselberg’s Renova holding company in the Kremlin. Renova owns stakes in companies producing gold and developing platinum and palladium deposits. 
Hu and Medvedev called for the “swiftest renewal” of six-party talks over the North Korean nuclear crisis. Their statement, however, included no new initiatives on the crisis.

TITLE: Former Deputy Held on Murder Charges
AUTHOR: By Galina Stolyarova
PUBLISHER: Staff Writer
TEXT: Mikhail Glushchenko, a former State Duma lawmaker from the Liberal Democratic Party, was detained on Wednesday at police precinct no. 58, where he was attempting to get a new Russian passport. The police suspect Glushchenko of organizing a triple murder, while some experts have also linked him to the murder of Galina Starovoitova, an ex-Duma lawmaker and champion of democratic reforms in Russia.
According to the Investigative Committee of the Russian General Prosecutor’s Office, Glushchenko was detained in connection with the investigation into the March 2004 murder of three Russian citizens: Yury Zorin, Viktoria Tretyakova and Vyacheslav Shevchenko. The victims were murdered in Cyprus at a private villa near Pathos. Shevchenko’s body was found wrapped in a plastic bag.
Shevchenko, a prominent businessman, knew Glushchenko as a fellow State Duma lawmaker, also of the Liberal Democratic Party. Zorin, who served as a national security adviser at the Duma, ran a highly profitable gambling business. Tretyakova was a privately-hired interpreter.
Glushchenko, 51, once served as an aide to Vladimir Zhirinovsky, the leader of the Liberal Democratic party.
Galina Starovoitova, the uncompromising and outspoken leader of the Democratic Russia party, was shot in the stairwell of her building on Nov. 20, 1998. She died instantly, and her aide, Ruslan Linkov, who was with her at the time, suffered severe head injuries but survived.
Galina’s sister, the historian and human rights advocate Olga Starovoitova, said she is hoping Glushchenko’s detention will help to shed some light on the circumstances of the orchestration of her sister’s killing.
“My greatest hope is that the stalled investigation will begin to move on again, and one day we will know the names of the criminals who ordered Galina to be gunned down,” Olga Starovoitova said.
During the course of the investigation, the killers mentioned on record that they had visited Glushchenko’s parliamentary office on a number of occasions, and that the premises were used as headquarters for organizing a surveillance operation to follow Starovoitova. The killers also said Glushchenko’s office was stocked with guns and devices for phone bugging.
“All this information had been duly filed and can easily be found,” Olga Starovoitova said.
Olga Starovoitova criticized the investigation for failing to establish the political motives behind the killing, despite promises from those in power, including former president Boris Yeltsin and current president Vladimir Putin, that law enforcement officers would not rest until those behind the killing were convicted.
Starovoitova’s killers — Valery Akishin and Yury Kolchin — have been convicted and sentenced to 23 1/2 years and 20 years in prison respectively.
“Those who ordered the crime have still not been found,” Olga Starovoitova said. “And unless the mastermind behind the murder is established and [his guilt proven], we can only keep guessing at what exactly may have driven them to kill Galina.”
The assassins took neither Starovoitova’s money nor her valuables. The deputy had a substantial amount of cash, including 855 rubles, a 1,000 Deutschmark note and about 18 $100 bills with her when she was shot on the stairwell leading to her apartment on Naberezhnaya Canal Griboyedova.
Olga Starovoitova said that the family has been trying to answer the question of why Galina was murdered for a very long time.
“It is very complicated,” Olga Starovoitova said. “She tried hard to make the country’s budget transparent, and believed legislators should be able to trace where state money goes. This, of course, was rather irritating for those on the receiving end of improperly directed budgetary funds.”
During the investigation, Starovoitova’s aide Linkov suggested that former LDPR deputy Shevchenko and his counterpart Glushchenko were linked to the assassination, but the prosecution did not prove any connection.
“Far be it for me to accuse Mikhail Glushchenko of setting up my sister’s murder,” said Olga Starovoitova. “But considering the evidence obtained during the investigation of Galina’s murder, I find it quite likely that he may have been an important link between the killers and those who masterminded the vicious plan.”

TITLE: Oligarch Deripaska, Rebuked, Urges Russia to Fix Economy
AUTHOR: By Yuriy Humber and Ellen Pinchuk
PUBLISHER: Bloomberg
TEXT: Oleg Deripaska, the Russian billionaire rebuked by Prime Minister Vladimir Putin for wage arrears at his Pikolyovo factory, said the government should do more to improve the economy if it wants businesses to succeed.
The onus is on state officials to help revive demand as the economy shrinks for the first time in a decade, Deripaska told Associated Press Television in an interview yesterday. Russian industrial production contracted a record 17.1 percent in May from a year earlier.
“The government better focus” on stimulating growth and “we will run our company,” Deripaska said during a tour of his OAO GAZ light-vehicle maker’s main factory in Nizhny Novgorod, where production has been curtailed to one shift a day. “I would like the government to fix the economy.”
Putin, 56, publicly criticized Deripaska, 41, earlier this month for wage arrears at his cement plant, warning that the state would take over where private owners failed. Dmitry Medvedev, who succeeded Putin as president last year, said this week that owners who idle factories on slumping sales should be “educated” by local governors and helped to reorganize the business so it can make a profit.
The state is ramping up pressure on business to share the social burden of unemployment at an eight-year high, with more than 600 Russian industrial towns dependent on one company’s factory for heat, power and their municipal budget as well as jobs. One in 100 Russians are economically reliant on Deripaska’s business empire.
“You made thousands of people hostages of your ambitions, lack of professionalism and perhaps plain greed,” Putin told Deripaska and other owners of idled factories in the northwest town of Pikalyovo on June 4. Deripaska was then filmed signing cheaper raw material contracts for his factory with suppliers.
Deripaska, speaking at the GAZ factory that may help to produce Opel brand cars after Russia’s OAO Sberbank and Magna International Inc. agreed to buy the German unit of General Motors Corp., said his companies can “do our job” when the economy recovers. Putin said this month he backed the state-run Sberbank’s plans with Canada’s Magna, under which GAZ would make Opel cars without owning any shares in the German company.
“I don’t care: dependence or independence for GAZ” from the state, Deripaska said. “The people you see here are well- trained and good enough to work in line with demand. And demand should be generated from the economy itself.”
Medvedev told more than 2,000 executives and guests at the “Russian Davos” in St. Petersburg earlier this month that the “peak” of the crisis has been reached and that Russia would recover faster than expected by outside observers.

TITLE: Former Soviet Leader Gorbachev Records Album
AUTHOR: By Alexandra Odynova
PUBLISHER: The St. Petersburg Times
TEXT: MOSCOW — Mikhail Gorbachev has added crooner to his skill set. 
The former Soviet leader and Nobel Peace Prize laureate said Tuesday that he recorded an album of old Russian romantic ballads to raise money for a charity dedicated to his late wife, Raisa. 
“The disc includes seven of Raisa Maximovna’s favorite romantic songs. I sang them myself, with Andrei Makarevich playing the background music,” Gorbachev said at a news conference at his Gorbachev Foundation in Moscow, Interfax reported. Makarevich is the founder and frontman of the rock group Mashina Vremeni. 
Only one copy of the album, “Songs for Raisa,” was made, and it was auctioned off at a charity dinner at London’s Hampton Court on June 6, according to the web site of the Gorbachev Foundation.

TITLE: In Brief
TEXT: <strong>Ex-Consul Investigated</strong>
ST. PETERSBURG (SPT) — Finnish police are investigating an employee of the Finnish Consulate in St. Petersburg who helped take a boy of Russian-Finnish parentage out of Russia, the Consulate said Wednesday.
The Central Police Department of Finland is investigating the actions of Finnish consul Simo Pietilainen, according to the Finnish Consul General to St. Petersburg, Olli Pereheentupa, Interfax reported. Pietilainen, on his own initiative, helped the Finnish father of five-year-old Anton Salonen take the boy to Finland against the will of the boy’s Russian mother. Reports vary as to whether the two men took Finnish-born Anton to Finland in April or in May.
The investigation is questioning whether Pietilainen violated the responsibilities of his position and to what extent, Pereheentupa said. The Consul General also said he was confident that the Russian law enforcement agencies would conduct their own investigation, stressing the fact that the Finnish and Russian leaders have discussed the issue.
Pietilainen is no longer working at the Finnish Consulate in St. Petersburg and has been declared a persona non grata by the Russian government. 
In addition, the Prosecutor General of the Nizhegorodskaya Oblast has filed a criminal case that accuses the father of kidnapping and in which the Finnish diplomat might be considered an accomplice, Interfax reported.

<strong>EU Slams Finland</strong>
ST. PETERSBURG (SPT) — The member countries of the Schengen Agreement have criticized fellow member Finland for issuing too many visas to Russian citizens, Interfax reported Wednesday.
The customs control agreement, which includes 25 European countries, for the most part allows visa-free travel between its member states. Russian citizens who obtain a Finnish visa can, after first traveling to Finland, move on to other Schengen states. The other member countries criticized Finland for treating Russian citizens too favorably in the issuing of visas.
Last year, the Finnish Consulate in St. Petersburg issued 525,000 visas, according to Consul General Olli Pereheentupa. For the first five months of 2009, the quantity of visas given was down four to five percent from last year, Pereheentupa said, but over the course of the year the number should be the same as 2008.
Pereheentupa said that Finland has a “tougher system” and “more logical policies” than the other Schengen states.

<strong>Loungers to Be Hosed</strong>
ST. PETERSBURG — The lawn in front of St. Petersburg’s Kazan Cathedral will be periodically watered to prevent citizens from lounging on the grass, city authorities announced Thursday.
In the near future, the city will install an automatic watering system around the grassy area in the square in front of the cathedral, said Vera Dementyeva, the chairman of the Committee for the Control, Use and Protection of Monuments. The committee decided the matter during its session on the preservation of cultural heritage, Interfax reported.
Park users will be prevented from lying on the lawn by the wet grass, Dementyeva said, adding that the lawn is intended for “visual pleasure” and that the area should be a “civilized park” with marked paths for walking. 

<strong>Hostage Freed</strong>
MOSCOW (Bloomberg) — The 19-year-old son of Rosneft Vice President Mikhail Stavsky was freed Wednesday night, two months after being kidnapped from a Moscow university, investigators said.
Stavsky’s son, also named Mikhail, is in good health and is answering questions about the abduction, the Investigative Committee of the Prosecutor General’s Office said on its website on Thursday.
Kidnappings have increased in Russia as part of a lucrative criminal racket, Novaya Gazeta said June 1. The investigative newspaper, owned by businessman Alexander Lebedev, published a “far from complete” list of eleven kidnappings in the past four years in which ransoms of more than $350,000 were demanded.
Four unidentified men grabbed Stavsky’s son and forced him into a BMW at the Gubkin Russian State University of Oil & Gas in southern Moscow at about noon on April 13, the investigators said on the web site on June 2.
The abductors demanded a 50 million-euro ($70 million) ransom for Stavsky’s son, Novaya Gazeta said at the time, citing an unidentified law enforcement official. Investigators on Thursday declined to provide details of his release.
Stavsky oversees production at state-controlled Rosneft, Russia’s largest oil company, after joining the company in November 2005.

<strong>158-Year Driving Ban</strong>
MOSCOW (SPT) — A Siberian driver lost his license for 158 years on Wednesday for what police described as “numerous traffic violations,” Interfax reported.
Barnaul police suspended the driver’s license of Denis Mikhailov, 30, after reprimanding him for speeding, going through red lights and other moving violations, the report said. Mikhailov at one point was jailed for 10 days for one violation.
He will be able to reapply for his license on Aug. 1, 2167.

TITLE: SCO Endorses Ahmadinejad Victory
AUTHOR: By Nabi Abdullaev
PUBLISHER: The St. Petersburg Times
TEXT: MOSCOW — Leaders wrapped up a Shanghai Cooperation Organization summit on Tuesday with a whirl of activity: They congratulated Iranian President Mahmoud Ahmadinejad on his re-election; signed a declaration affirming a multipolar world; rebuked North Korea; promised to help Afghanistan; and pledged to allow more members into their circle. 
China — which competes with Russia for influence in the six-nation alliance that positions itself as a counterbalance to the United States’ influence in the region — offered a $10 billion loan to group members to counter the effects of the global economic crisis. 
President Dmitry Medvedev held one-on-one talks with Ahmadinejad, who flew to the summit in the Urals city of Yekaterinburg amid protests at home that his re-election had been rigged and questions from the United States and European Union about the legitimacy of his victory. 
Medvedev’s spokeswoman Natalya Timakova told reporters that the two leaders agreed to continue economic and humanitarian cooperation. 
“The heads of SCO member states congratulated Ahmadinejad on his re-election,” she added. 
Deputy Foreign Minister Sergei Ryabkov told reporters that Moscow regards the Iranian election as an internal matter for the country. He praised Ahmadinejad’s visit to Russia as “quite symbolic” and said it heralded closer relations between the countries. 
Iran holds observer status at the SCO along with Pakistan, Mongolia and India. On Tuesday, the SCO leaders agreed to grant Belarus and Sri Lanka partner status — a step above observer status but not quite a full member. 
Ahmadinejad, who arrived a day late for the summit, used his first trip abroad since Iran’s Friday election to criticize the United States at one of Tuesday’s meetings. 
“America is enveloped in an economic and political crisis, and there is no hope that they will be resolved,” he said, speaking through an interpreter, The Associated Press reported. 
He said the “age of empires” has ended. 
Iran has sought full membership in the SCO in the past, as has Pakistan, but Russia and China have blocked their bids. 
Pakistani President Asif Ali Zardari said Tuesday that he wanted Pakistani representatives to have access to all SCO events even if his country could not become a member. 
Medvedev and Tajik President Emomali Rakhmon spoke out in favor of allowing more members into the SCO, though they did not name any particular country. 
“It is necessary to speed up the drafting of a document that would define the procedure to admit new members into the SCO,” Medvedev said. 
Chinese President Hu Jintao offered a credit loan of $10 billion to the four Central Asian states that belong to the SCO — Kazakhstan, Kyrgyzstan, Tajikistan and Uzbekistan — to boost their economies amid the crisis. 
The SCO leaders signed a declaration Tuesday that welcomed the recent start of nuclear arms reduction talks between Russia and the United States and warned against any attempt by a nation to unilaterally try to obtain a military edge over other countries. 
The alliance also adopted a convention against terrorism in which the member states agreed to continue joint anti-terrorism military exercises. 
Medvedev for the first time voiced his opposition to North Korea’s recent nuclear test and the threats its leadership has made to other countries. “Of course, we noted that this kind of behavior in the current situation is unacceptable,” he told a news conference. 
On Tuesday, the formal leadership of the SCO moved from Russia to Uzbekistan. The next summit will be held in Tashkent in 2010.

TITLE: BRIC Leaders Search For Greater Influence
AUTHOR: By Ira Iosebashvili
PUBLISHER: The St. Petersburg Times
TEXT: MOSCOW — President Dmitry Medvedev led the leaders of Brazil, China and India in discussions Tuesday on reforming the global financial system and lessening reliance on the United States at the first summit of the world’s four largest emerging economies. 
The four BRIC countries — which make up 15 percent of the global economy and hold nearly 40 percent of the world’s currency reserves — expressed interest in working more closely together economically, although the cooperation at the Yekaterinburg summit was mostly confined to symbolic gestures. 
Leaders discussed investing their reserves into one another’s bonds, swapping reserve currencies and increasing the role of Special Drawing Rights, an international reserve asset. But discussions about the creation of a supranational currency and lessening global reliance on the U.S. dollar — two favorite Kremlin topics as of late — were confined to a meeting of the Shanghai Cooperation Organization that took place earlier in the day in the Urals city. 
In his opening comments, Medvedev said it was “obvious” that the BRIC leaders needed to find “nonstandard decisions” to common economic problems. 
“Life is difficult. Strategic partners must meet more often and seek broader trade and economic relations,” Medvedev told Brazilian President Luiz Inacio Lula da Silva earlier in the day. 
A joint BRIC statement issued before the summit called for a greater role for developing nations in global financial institutions and the United Nations. 
“We are committed to advance the reform of international financial institutions so as to reflect changes in the world economy,” the statement said. “The emerging and developing economies must have a greater voice and representation in international financial institutions.” 
The statement also said the senior leadership of international financial institutions should be selected “through an open, transparent and merit-based selection process.” 
At the end of the summit, Medvedev said developing countries must “create the conditions for a fairer world order.” The other leaders sat next to him and did not offer any comments. 
Medvedev reserved his more fiery rhetoric for the Shanghai Cooperation Organization summit, showing that Russia remained eager to play the role of a power broker among emerging economies and a critic of the current world financial system — which it views as unfairly dominated by the United States. 
Despite recent comments by Finance Minister Alexei Kudrin in support of the dollar, Medvedev continued his verbal assault on the U.S. currency, urging leaders to find a way to diversify the world’s reserve currencies. “The existing set of reserve currencies, including the U.S. dollar, have failed to perform their functions,” Medvedev said. 
“There cannot be a successful global currency system if the financial instruments it uses are denominated in only one currency,” he said. “This is the case today, and that currency is the dollar.”

TITLE: Georgians Lambast UN Veto
PUBLISHER: Combined Reports
TEXT: TBILISI, Georgia — Georgia on Tuesday criticized Russia for vetoing a resolution that would have extended the UN observer mission in the breakaway Abkhazia region, saying it showed Moscow’s isolation from the world. 
Russia’s Security Council veto highlighted Moscow’s unwillingness to budge even slightly on the issues surrounding Georgia and the fallout from the war last year between Russia and Georgia. 
“Russia has used its veto power, which can be considered a failure of diplomacy,” said Georgian Foreign Minister Grigol Vashadze. “The veto is like an atomic weapon — using it confirms the isolation of the user.” 
The small UN mission — about 130 military observers and more than a dozen police — has been in Abkhazia for 16 years. They were deployed following the end of fighting that resulted in Abkhaz militias routing the Georgian army, expelling ethnic Georgians and taking control of the Black Sea region. 
The mission’s importance increased after last year’s war between Russia and Georgia, which wants to reassert control over Abkhazia and another region, South Ossetia. Moscow has recognized both regions as independent nations.

TITLE: Pikalyovo Wants More Help From Putin
AUTHOR: By Nadia Popova
PUBLISHER: The St. Petersburg Times
TEXT: PIKALYOVO, Leningrad Region — Prime Minister Vladimir Putin is revered as a hero by many residents of this small town after he forced tycoon Oleg Deripaska to pay their back wages. Now, some of Pikalyovo’s other crisis-hit businesses wish that Putin would intervene on their behalf. 
“I am going to go bankrupt because of BaselCement, and Putin’s visit didn’t help me at all,” said Anatoly Ogloblin, director of Stroimontazh Plus, a local construction firm. 
Deripaska’s BaselCement owes 12 million rubles ($390,000) to Stroimontazh Plus for switching an oven from alumina to cement production at its Pikalyovo factory last year. 
“I had just opened my firm, and BaselCement was the first and only client,” Ogloblin said. 
“Since there was no payment, I haven’t paid 2 million rubles in taxes. The tax service filed for my bankruptcy in May,” he said. 
He waited until this spring to sue BaselCement, explaining that he hadn’t wanted to lose his only client. 
A total of 50 lawsuits have been filed against BaselCement, according to the web site of the Arbitration Court for St. Petersburg and the Leningrad region, mostly by business owners seeking to recoup debts incurred before Deripaska shut down the factory in February. 
Some of the owners are among Pikalyovo residents whose problems remain unresolved after Putin’s lightning visit to this one-industry town of 22,000 people, located 245 kilometers southeast of St. Petersburg. At Putin’s prompting, the BaselCement factory reopened Saturday with a contract for enough raw materials for the next three months. 
But it has not made good on all its debts, leaving related industries and other businesses in a tight spot. 
“I haven’t paid 40 of my workers because of BaselCement, and they are now waiting penniless,” said Alexander Umansky, director of Taiga-1, a construction firm that worked with Stroimontazh Plus in switching the factory oven between August and November. 
Umansky sued BaselCement for the outstanding 1.7 million rubles ($54,000) in December and won. But the money still hasn’t been paid. 
“Putin’s visit hasn’t affected our situation in any way,” Umansky said. “We still have not received our money, and we are not sure whether we will in the near future.” 
BaselCement spokeswoman Yelena Andreyeva said by cell phone Wednesday that BaselCement would pay off its debts soon. 
“We have gone through difficult times,” Andreyeva said. “Now, we are planning to pay our debts, but will consider every case separately. And we expect our partners at the Pikalyovo plant and in the town administration to pay us, too.” 
The city administration owes BaselCement about 125 million rubles ($4 million) for heat produced by the local power plant, which BaselCement owns. It wasn’t immediately clear how much Metakhim and Pikalyovo Cement — which share the same compound as BaselCement — owed the factory. 
When BaselCement stopped paying wages to its 2,600 employees in March, Metakhim cut salaries significantly. Pikalyovo residents stopped paying their utility bills, leading the power station to turn off the town’s hot water. A 2-year-old boy died when a pot that his family was using to heat up water on a stove overturned, searing him with boiling water, the Pikalyovo hospital said. 
 Angry and hungry, about 400 residents blocked the federal highway for seven hours on June 2, creating a 438-kilometer traffic jam. 
BaselCement welder Sergei Shitin said it had been hard to explain to his 10-year-old son and 17-year-old daughter why there was no food for them to eat. 
“The kids had gotten used to eating yogurt and other tasty things like that,” Shitin said at the factory’s gates. “We hadn't bought any for the last three months, but they would run to the fridge every five minutes in hope that something would appear there.” 
Shitin used to take home a monthly salary of 30,000 rubles, including bonuses, but he received only his base pay when he got his three months of back wages, or a total of 39,000 rubles ($1,250). 
Shitin decided not buy any yogurt with the money. “We are not buying much food now, because we don’t know what will happen next,” he said. “No one knows anything about this man, Deripaska. We don’t trust him.” 
Putin rebuked Deripaska and other factory owners during his visit to Pikalyovo, comparing them to cockroaches. “You have made thousands of people hostages to your ambitions, your lack of professionalism — or maybe simply your trivial greed,” Putin said in remarks shown on state television. At one point, Putin threw a pen at a contract and told Deripaska to sign it. The document was a three-month contract for raw materials for the factory. 
Putin is now quoted on every corner in the town. The residents especially like to retell the moment when Putin threw the pen at Deripaska. 
“Putin is our hero, and Deripaska is our enemy No. 1,” said BaselCement worker Andrei Khvan, 59. 
“Putin is the idol of my 14-year-old daughter,” said Valery Kononchuk, a realtor at Address, the only real estate firm in the town. “Putin’s portraits have now been hung up in the kindergartens.” 
“Our country badly needs a strongman like Putin,” said Marina, 35, a worker from Metakhim, her eyes sparkling. “Medvedev is too much of a humanitarian. He is not the right type.” 
Pikalyovo Mayor Sergei Veber, however, downplayed the significance of Putin’s visit, saying many government officials had toiled to resolve the town’s problems. “People tend to think it was only with Vladimir Putin’s visit that everything was decided, but it was actually preceded by days and nights of intense work by the regional government, the government in Moscow and our administration,” Veber said in an interview. 
Veber also said he believed that he had done all he could to prevent unrest. “Look at the law,” he said. “The city administration worked perfectly to prevent problems in the town.
We did everything that we were responsible for.” 
When asked whether he had been aware of the brewing conflict with the factory owners, he likened intervention in the dispute to breaking into an apartment, noting that the factories were private property. 
Putin has accused unnamed people of paying Pikalyovo residents to blockade the highway — a suggestion that perplexed Yelena Guryanova, the trade union leader at the BaselCement power station. 
“He must have gotten some incorrect information from officials who had not expected us to take such an action,” Guryanova said. “We must be respected. We have our civil rights and liberties to defend.” 
She and other residents said the only thing that has changed in their lives was the burst of attention surrounding Putin’s visit. 
Olga Germanova, 35, said all of the 10,000 rubles that she earns each month selling goods in a shop goes toward paying off three loans that her family of four took before her husband lost his job at Metakhim. 
“We bought a car, a cellphone and a computer when times were good,” Germanova said. 
The family lives on her husband’s unemployment pay of 4,900 rubles. 
“We eat pasta. Nothing has so far changed with Putin’s visit,” Germanova said. 
At Address, the real estate agency, the price for a one-room apartment has dropped from 950,000 rubles to 400,000 rubles over the past three months as people default on their mortgages. 
“Everyone wants to sell their apartment,” said Address head Yevgeny Sulin, sitting in his empty office. “We have gotten about 80 apartments to put on sale over the last three months. Many of those who want to sell can’t service their mortgages.” 
Unemployment in Pikalyovo has risen from 1.7 percent in October to 9.5 percent as of mid-June. A total of 1,098 people have registered with the local unemployment office, which has 158 job openings. 
“There are more jobs in nearby towns, but no one wants to move, because the salaries there are just as low as here and there is usually a problem finding a place to live,” said Svetlana Yershova, head of the unemployment office. 
Posters on the wall of the office advertise jobs for a veterinarian (20,000 rubles a month), the conductor of a brass band (15,000 rubles) and a blacksmith (4,557 rubles). All the jobs are located in the Voronezh region, more than 1,200 kilometers to the south. 
“We are not going to move anywhere just because someone like Deripaska has destroyed our nest,” said Guryanova, the trade union leader. 
Veber, the mayor, said people did not want to move because they did not like change. “People are not ready for active change,” Veber said. “The Russian mentality is like that.” 
Guryanova, 39, described the last three months as the hardest in her life. She spoke in her kitchen, sitting beside her husband, Alexander, who also works for the BaselCement power station. 
She, like many Pikalyovo residents, has survived for the last three months on vegetables grown last summer at her dacha just outside the town. 
“I have never eaten as many pickles in my life as I ate during this time,” Guryanova said.

TITLE: Service Gets Tough On Errors In Spelling
AUTHOR: By Alexei Nikolsky and Dmitry Kazmin
PUBLISHER: Vedomosti
TEXT: MOSCOW — The Federal Anti-Monopoly Service has annulled contracts worth 1.2 billion rubles ($38.5 million) for state orders because of typographical distortions in six declarations, and more than 2,000 other violations have been found and will be investigated.
Using Latin letters instead of Cyrillic, as well as other typographical tricks, could be used to short-circuit the competitive bidding process. Using nonstandard spellings in declarations on the government’s web site for state purchase could allow well-connected firms to land sweetheart deals if other companies are unable to find the order.
Vatutinki, a children’s welfare center, left out the space between the words “children” and “Vatutinki” in its announcement on the web site Zakupki.gov.ru about buying reconstruction work worth 106.2 million rubles.
All government bodies ordering goods or services are required to post announcements on the site about the start of bidding, the terms of the tender and the rules for evaluating bids. Bidding on the Vatutinki order is set for July 9.
According to Economic Development Ministry figures, the federal government will spend 1.35 trillion rubles ($43 billion) on goods, work and other services this year, excluding classified military orders, and the figure will exceed 4 trillion rubles when combined with regional and municipal orders.
The bidding on an order posted by Shchyolkovsky Biokombinat — for the production and oversight of a culture of inactive anti-rabies vaccine valued at 773 million rubles — was held March 11, and it was won by PSK Union-Stroi, the only firm to bid. In the announcement’s key words, the Cyrillic letter “k” was replaced with the Latin one, and the letter “o” was replaced with the number “0.”
Tricks involving the substitution of letters is hardly new, dating at least back to 2006, when the new law on state orders came into effect, said Alexander Stroganov, general director of the State Orders Placement Center. Such methods lead to significantly fewer bids, said Alexei Morozov, one of the authors of the National Rating of Purchasing Transparency. The bidding in such cases involves one or two suppliers, and the price is 10 percent to 15 percent higher than in competitive tenders, he said.
On Tuesday, the anti-monopoly service official announced that distorted spellings in the announcements would lead to the nullification of orders. “The aforementioned actions of the buyers essentially mean that bidding is not being held, since potential participants in the tender cannot find information about it by keywords on the official site,” the service said.
The service attached to the announcement a list of six violations for a total sum of more than 1.2 billion rubles. On Wednesday, another 16 tenders were to be investigated, said Mikhail Yevrayev, the service’s managing director. In total, some 2,000 purchases with distorted listings will be investigated, he said.
Yevrayev said that in the cases where a contract has not yet been signed, the anti-monopoly service would void the offers for violating the rules for announcing a purchase (Article 16 of the Law on State Orders). In instances where a contract was signed, the service will seek to have it annulled in court.

TITLE: Ban on Dairy Products Lifted
AUTHOR: By Maria Antonova
PUBLISHER: The St. Petersburg Times
TEXT: MOSCOW — The Federal Consumer Protection Service said Wednesday evening that it would allow Belarus to resume sending its milk and dairy products across the border to Russia following another round of talks with a new delegation of officials from Minsk. 
A reconstituted Belarussian delegation arrived in Moscow to continue negotiations that were broken off Tuesday when Gennady Onishchenko, the service’s head, said he doubted whether the deputy agriculture minister sent to negotiate with him was competent to be holding the talks. 
“A protocol has been signed that satisfies the Belarussian and Russian sides,” Onishchenko told reporters. He said the sides agreed to work toward “the realization of Russian technical regulations on milk” and that milk imports could resume Thursday morning. 
The conflict began earlier this month when the Federal Consumer Protection Service banned almost all Belarussian dairy products, citing their noncompliance with technical regulations passed in December. The rules require that producers indicate on the packaging any dehydrated milk content. 
Belarussian dairy exports to Russia have been estimated to be worth as much as $1 billion per year, and the ban came shortly after Russian Finance Minister Alexei Kudrin and Belarussian President Alexander Lukashenko traded barbs over the health of the Belarussian economy. Onishchenko said Wednesday that Belarussian producers would move to fulfill the packaging requirements “in the near future.” 
The apparent resolution comes as Belarussian customs officials said they were stepping up inspections for counterfeit and smuggled goods along the border with Russia. 
“The Russian side has been controlling the flow of goods on the Belarussian-Russian border since 2000, so our authorities decided to adhere to the same policies, perhaps with some delay and after learning some lessons,” said Vladimir Pekhterev, a spokesman for the Belarussian Customs Committee. 
Although Russia and Belarus formed a customs union in 1995 that bans any duties on goods flowing between the countries, a Russian government decree in 2000 reintroduced the control points to process goods from third countries en route to Russia. 
Alexander Proshin, a spokesman for Russia’s Federal Customs Service, said inspections on the Russian side were “minimal.” 
“We are obligated to check all trucks to see whether the goods were produced in Belarus or third countries,” he said. 
The Customs Committee of Belarus introduced the new border control points following an order from Lukashenko. Belarussian Security Council head Yury Zhadobin said the steps repeated “the actions used by the Russian side for many years.” 
Pekhterev confirmed that five customs points were established Wednesday. On the Russian side, there are 17 control points, so the number on the Belarussian side is likely to grow, he said. 
The delegation that arrived Wednesday was led by Agriculture Minister Semyon Shapiro and Health Minister Vasily Zharko and held talks at the Agriculture Ministry before meeting Onishchenko.

TITLE: Finance Ministry May Hike Gas Extraction Tax
AUTHOR: By Courtney Weaver
PUBLISHER: The St. Petersburg Times
TEXT: Businesses who thought that they were in for a tax break next year will be out of luck, and the government will try to fill other budgetary holes through tax hikes on gas extraction, Deputy Finance Minister Sergei Shatalov said Wednesday. 
At the moment, “the ministry simply does not see any possibility for a taxes cut,” Shatalov said, destroying hopes that some employers had that their taxes would be eased after the unified social tax is raised next year. 
The government announced last October that it would raise the tax that businesses pay on employee salaries by as much as 8 percentage points in 2010 to allocate more funding for pension, medical and social funds. 
While businesses will not be compensated for the tax increases, employers have already been given a number of breaks by the government, Shatalov said. 
Last year, for example, a total 700 billion rubles ($22.4 billion) that would have otherwise been levied in taxes remained in private hands because of extraordinary tax measures, while businesses kept an additional 250 billion rubles because the state postponed its gas extraction tax hikes. 
“One can look at these measures as advanced compensation for the future [tax] increases,” Shatalov said. 
To bring in an additional 50 billion rubles in budget revenue, the state may raise the gas extraction tax next year and could also lower duties on refined oil products to bring the tariffs closer in line with those on crude oil, Shatalov said. 
The second decision would encourage producers to refine the oil they export, an agenda the government has been promoting. 
To assist the country’s new deposits, especially those in the Far East, the Finance Ministry is advocating a more lenient tax regime on recently developed fields. 
“Before us stands the task of redistributing the tax burden from time to time to minimize taxes during the early and late stages of an oil field’s development and instead collect more taxes during the times when the field is more productive,” Shatalov said, declining to elaborate on how the state would accomplish this. 
In the interim, the proposal will have to meet the approval of the Energy Ministry, which has previously argued that such a reform would lead developers to invest only in new fields instead of existing ones. 
Shatalov, in turn, said it was important to remember that these investments would be good for the regions where the new fields were being built, as many developers would never choose to invest in these areas otherwise. 
“This infrastructure needs to be built, and it requires a huge capitalization,” he said.

TITLE: Brits Asked for Chichvarkin
PUBLISHER: Bloomberg
TEXT: MOSCOW — Russia asked Britain to extradite Yevgeny Chichvarkin, co-founder of mobile-phone retailer Yevroset, on charges of kidnapping and extortion.
Russian prosecutors submitted a request to the U.K. Home Office on Wednesday to arrest Chichvarkin, who is living in London, said Marina Gridneva, a spokeswoman for the Prosecutor General’s Office in Moscow.
Prosecutors on Jan. 15 accused Chichvarkin of organizing the 2003 kidnapping of Yevroset’s logistics chief and extorting money from him. Chichvarkin denies any wrongdoing and will contest the charges, his lawyer Vladimir Zherebenkov said.
“The accusations are unfounded and fabricated,” Zherebenkov said by phone from Moscow.
Chichvarkin, 34, and his partner Timur Artemyev sold Moscow-based Yevroset to businessman Alexander Mamut in September as banks became reluctant to lend. The next month, Mamut sold 49.9 percent of Yevroset to VimpelCom, the country’s second-largest cellular company, for $226 million.
Yevroset had sales of $5.61 billion in 2007 from 5,145 outlets in 11 former Soviet republics, according to the company.

TITLE: Russia Hopes WTO Agreements Will Remain in Force
PUBLISHER: Bloomberg
TEXT: Russia expects to retain agreements reached during 16 years of talks to join the World Trade Organization after deciding to pursue a joint membership with Belarus and Kazakhstan, Prime Minister Vladimir Putin said.
 “We have to make sure that the level of agreements reached with the WTO is not lost and relinquished,” Putin said Thursday during a meeting in Moscow with Economy Minister Elvira Nabiullina, according to a transcript of his remarks published on the government’s web site.
The three countries said on June 9 they had informed the WTO unofficially and verbally that they would make a joint bid, according to Tass news agency. The group accession talks will be part of a customs union among the three former Soviet republics. The free-trade zone will begin to function starting on Jan. 1, said Nabiullina.
 “We proceed from the assumption that the customs union and the WTO are not opposing alternatives. We are simply joining the WTO together,” Nabiullina told Putin.
Trade negotiators representing all three nations are in Geneva meeting members of the 153-nation institution to coordinate a “new format” for the customs union bid, she said. 
Although WTO members can decide whether a group bid is possible, there are no precedents for negotiating a simultaneous accession.

TITLE: Wage Arrears Increase
PUBLISHER: Bloomberg
TEXT: MOSCOW — Wage arrears rose 10.8 percent in May as manufacturing contracted at a record pace, the State Statistics Service said Wednesday. 
Total unpaid wages rose to 8.78 billion rubles ($282 million) on June 1 after falling for the first time in four months in April. Half a million people were affected by the delayed payments, with 49 percent of the money overdue coming from manufacturing businesses, the statement said. Industrial production slid an annual 17.1 percent in May.

TITLE: A Test of Honesty, Not Knowledge
AUTHOR: By Konstantin Sonin
TEXT: Soviet leader Josef Stalin and his henchmen discredited the word “sabotage” by accusing political opponents and their followers of the crime with reckless abandon. The dictionary defines sabotage as “deliberately disrupting an event, evading work or working in a deliberately dishonest or unscrupulous manner.” However, because Stalin’s regime never produced any proof that various groups were actually guilty of sabotage — from kulaks accused of undermining the grain harvest to engineers blamed for sabotaging industry and peasant Soviet Army commanders accused of subterfuge in their war preparations — the word became discredited.
But “sabotage” is a good word, and it is difficult to avoid the temptation to use it when speaking about the way the EGE — the nationwide standardized college admissions exam — was administered in Moscow recently. A professor at one of Moscow’s leading universities told me of how, during the math exam on June 4, his department was overrun with a throng of parents and friends of the test takers — who, by the way, had downloaded entire sample tests and math problems onto their cell phones. University students were also constantly taking calls, answering questions from the kids as they took the test. This is no isolated incident: The scene was repeated in thousands of classrooms all across Russia. High school teachers have complained to me that the individuals charged with administering the test were especially lax this year. This suggests that opponents of the EGE who were unable to convince the authorities to abolish the test have resorted to discrediting the exam in order to achieve the same result.
Of course, the government should have the courage to defend its standardized exam (all the more since the results of the math exam indicate that saboteurs had little success in subverting the test). However, it is not always appropriate to be overly uncompromising. It is one thing to resist self-serving opposition from this or that special interest group but quite another to ignore educators, students and their parents when their only goal is to express genuine dissatisfaction with shortcomings in the test itself. What if, for example, the people administering the test in Moscow simply wanted to help the students make a better showing against students from Russia’s other regions who unexpectedly performed better than expected them last year? 
This phenomenon is not peculiar to Moscow alone. Last year, a teacher from a regional capital complained to me that standardized test results from rural students were significantly higher than students in city schools had scored — the reverse was to be expected under normal circumstances. Some changes are perhaps in order for the EGE.
One obvious problem is that colleges and universities must place too much emphasis on EGE results for their admission process. The whole process would be easier for everybody concerned if the institutions were allowed to set the number of places that would be allocated on the basis of EGE results — and would therefore be eligible for state scholarships — as well as how many would be determined according to the university’s own placement test and how many would be available to all comers willing to pay a standard fee. That way, students with exceptional or above-average abilities (who, by the way, suffer the most from artificially high scores from the regions) would not be forced to achieve outstanding EGE scores at any price, and those who currently sabotage the results in order to help them would feel less of a need to do so, thereby making discipline easier to enforce. In principle, the annual nationwide “Olympiads” hosted at universities that test students in their knowledge of basic academic subjects should serve this function to some extent. But somebody got the brilliant idea that the Olympiads should be broken down by grade and that universities should admit students based on standardized tests conducted by an “independent” and “impartial” system. Was it really so difficult to foresee that the people charged with administering such a test would be willing to fudge the results in favor of the test takers? Or is it necessary to go back to the dictionary and reread the definition of “subversive activity”?

Konstantin Sonin, a professor at the New Economic School/CEFIR, is a columnist for Vedomosti.

TITLE: A Poor Man’s Democracy
AUTHOR: By Yulia Latynina
TEXT: Iranian President Mahmoud Ahmadinejad has been re-elected after winning what he describes as a free and democratic election. The people living in Iran’s largest cities and the liberal public voted for his opponent, Mir Hussein Mousavi, but the poor, simple people — who make up the majority in Iran — voted for Ahmadinejad.
There is an ongoing gasoline shortage in Iran, but no shortage of missiles. Simple, poor Iranians understand very well why there is no gasoline: The infidels and Jews are opposing the Islamic revolution. Why? Because Iran has gotten up off its knees and established its authority in the West.
Did you know, by the way, that Iran is on the cutting edge in nanotechnology? That is what you will be told at Iranian cultural centers in St. Petersburg and Kazan. At the Pedagogical Institute in Astrakhan, Iranian instructors instill an outstanding knowledge of Farsi and a deep sympathy for the ideas of the Islamic revolution into their students. Graduates of that institute often go on to work at the Russian Embassy in Iran.
Iran spends huge sums of money on the Islamic revolution and on helping fellow Islamic regimes. The Soviet Union helped its friend North Korea, and Iran helps like-minded Hezbollah and Hamas. As I said, Iran spends so much money on Russia that supporters of the Islamic revolution work in the Russian Embassy in Tehran, so then-President Vladimir Putin looked like a complete fool when in 2007, citing bad Russian intelligence reports, he told U.S. Defense Secretary Robert Gates that Iran was incapable of producing ballistic missiles that could reach the greater part of Western Europe.
All of Tehran’s pet projects — Hamas, Hezbollah and its “peaceful” nuclear program — are tremendously expensive. That is why Iran has high inflation and no gasoline. Everybody understands that Iran has a nuclear program thanks to Ahmadinejad and a gas shortage thanks to the West. 
The Iranian vote demonstrates a simple truth that even Aristotle and Plato understood but that is frequently forgotten by fans of democracy today — namely that democracy is one of the worst forms of government if the majority of voters are impoverished. 
Have you ever wondered how it was that Mao Zedong managed to gain control over China? Mao was a bungling commander who lost every battle he ever fought. When his forces captured China in 1949, a terror already reigned in his base of operations, the Yanan province, that exceeded even the extraordinary cruelty displayed by Josef Stalin in 1937. But Mao got away with it because millions of simple peasants supported him.
What would have happened if Communist troops had not shot students on Tiananmen Square? Democracy would have come to China and 700 million impoverished peasants would have elected a modern-day Mao.
Over the past 2,000 years, democracies have come and gone with a rapidity that is unequaled by other forms of rule. All observers of democracy — from Thucydides to Machiavelli — have made note of one simple fact: If the voters do not own property, democracy does not differ from dictatorship and will inevitably end in tyranny. 
That vicious circle was broken in the West only with the start of the Industrial Revolution and a sharp increase in the standard of living for a majority of voters accompanied by a gradual decrease in the price of consumer goods. A few countries — such as Germany after the Treaty of Versailles, Iran following the Islamic Revolution of 1979, and Russia after the collapse of the Soviet Union — were unable to break out of that cycle.

Yulia Latynina hosts a political talk show on Ekho Moskvy radio.

TITLE: Ship ahoy!
AUTHOR: By Olga Kalashnikova
PUBLISHER: The St. Petersburg Times
TEXT: This summer, St. Petersburg is rich in yachting events. The city is preparing to host the Tall Ships’ Races Baltic 2009 international regatta in July, and while this event is mostly for professional sportsmen, amateurs have their own competition — the Baltic Boat Show regatta, which takes place in St. Petersburg this Saturday.
The regatta has been held every year since 2000 as part of the Baltic Boat Show exhibition that is held at Lenexpo and is devoted to everything connected to sailing ships, motorboats, inflatable boats, row boats, canoes, catamarans and jet-skiers. Equipment and accessories for all kinds of water sports are demonstrated at the exhibition, and the regatta is its crowning event. 
“Yachting as a sport was developed in the Soviet era, while in the early ’90s it began to decline,” said Yelena Vasilyeva, director of the Baltic Boat Show exhibition in St. Petersburg. “In the late ’90s, it began to revive. New competitions appeared, and that’s why the regatta was timed to coincide with the Lenexpo exhibition.” 
This year however, the timing of the exhibition has been moved from the summer to the end of the year, running from Nov. 26 to 29.
“It is more convenient for clients to order equipment or a boat in advance,” said Vasilyeva. “In this way it will be ready for the summer, whereas if people buy something in the summertime, there is hardly any time left in which it can be used. So the timing of the exhibition had to be moved.”
The regatta has remained a highlight of the city’s sporting events, and its format has changed little during the nine years of its existence. It starts at a particular point in the Gulf of Finland, from which boats must sail 10 miles. There are nine categories of vessels, each of which will have a winner. The best participants are awarded prizes, which this year will be binoculars. Every year the competition has awards for various aspects, which in previous years have included the boat’s equipment and the design of the yacht’s interior. 
There is also a special prize — the details of which are still a secret — for the youth group. Half of the sportsmen in this team must be from 16 to 25 years old. There are no age restrictions on the other groups. 
Most of the participating sportsmen are amateurs. Only the captain and the mate are required to possess a license to command the boat. Yachting amateurs can simply come and apply to participate in the regatta, and an appointed commission will discuss their candidature. 
“There are many sportsmen in St. Petersburg who are amateurs and do not have any official qualifications,” said Vasilyeva. “They form the basis of the team, while those who have qualifications can be captain of the yacht.”
Unlike the forthcoming international Tall Ship’s Races Baltic 2009, the Baltic Boat Show is a city-based event. The international regatta route is far longer, and the vessels that take part in it are much bigger. 
But in spite of the differences, both yacht competitions are aimed at promoting and popularizing the sport of sailing and improving the skills of yachtsmen.
“An important point here is the support of existing kinds of boats,” said Vasilyeva. “Yachting is a very expensive sport, and there was a time when people did not spend money on it and some kinds of vessels even stopped being made. The competition tries to save the old yachts and develop the emergence of new ones.”
The regatta also aims to attract young people to yachting. The distinguishing feature of the competition is that participants enter it purely for themselves, as they do not get any international certificates or major prizes. 
“They just love sailing, and they really need to take part in the competition, they need to win it, they need this thrill and excitement. It is important for themselves, for their inner development,” said Vasilyeva.
Such competitions are now rarely supported by the government, but the Baltic Boat Show is an exception and is supervised by the Maritime Council of the St. Petersburg government.
“It is widespread nowadays to hold competitions for, for example, bank awards, in which case they are held only for the representatives of the particular organization — a bank or something else, said Vasilyeva. “And, of course, there are large entrance fees. At the Baltic Boat Show, we also have a fee but it is purely symbolic — the highest cost for a whole team is 400 rubles ($13).”
The competition’s aim, then, is not mercenary — for the organizers, the best profit would simply be for more people to learn about the regatta and get involved in it.

TITLE: Chernov’s  choice
TEXT: What was to be a stadium concert by <strong>Manu Chao</strong> next Tuesday was quickly moved from the Yubileiny Sports Palace to a club, it emerged on Wednesday, reportedly due to poor ticket sales. The concert will now take place at Glavclub, which can hold around 2,000 fans — enough, though less than the 8,000 fans that Yubileiny is capable of cramming in.
Singer Chao, formerly of the French folk-punk band Manu Negra, will be supported by <strong>Fun-da-Mental</strong>, the radical multi-ethnic British alternative hip-hop dance band that memorably performed at the British Council-organized outdoor event U.K. Flavours in June 2007.
The band’s singer, Aki Nawaz, also took part in a seminar on tolerance at the British Council’s local office, which was later shut down by the Russian authorities early last year in the aftermath of the Alexander Litvinenko poisoning scandal.
On a positive note, <strong>Tequilajazzz</strong>, the local alternative favorites, have sold out a Glavclub concert and added a second gig at the venue in order to get more fans in, Glavclub announced on Wednesday.
“It’s our gift to the city,” said Yevgeny Fyodorov, the band’s singer and bassist, speaking by phone from Moscow on Thursday. As 2,000 tickets were sold at the low price of 100 rubles ($3.20) each, the same number of tickets will be issued at the same price, he said.
Tequilajazzz will showcase a new album called <strong>Dnevnik Zhivogo</strong> (Journal of a Living One), the band’s first studio album in seven years, which is due out on Friday. In Russian, the album’s title is intended to be a pun on the Livejournal.com blog service.
According to Fyodorov, the album includes some “totally reworked” songs that were released on the single “Berlin” in 2007 and some “entirely” new material. The band’s previous full-length studio album was “Vyshe Oseni” (Higher than Autumn) in 2002.
Tequilajazzz will play at Glavclub on Saturday and Sunday.
Fyodorov’s other band, <strong>Optimystica Orchestra</strong>, which was originally formed to perform a live soundtrack to an art-house film and features figures including ex-Akvarium cellist Seva Gakkel, will perform at a world music event entitled <strong>Gogol Fest</strong> at Manezh Kadetskogo Korpusa on Wednesday.
Fyodorov’s other activities include composing music for films, the latest of which, Finnish director Jari Kokko’s 58-minute documentary “44500 Max,” premiered in Helsinki earlier this week.
The punk band <strong>P.T.V.P.</strong>, or Posledniye Tanki v Parizhe, will also perform a pair of concerts at Zoccolo, the nice alternative basement club, on Friday and Saturday.
Later in the week, don’t miss <strong>Howe Gelb</strong>, the American singer-songwriter/producer and the man behind <strong>Giant Sand</strong>. Last year he released two albums, both solo and with Giant Sand, the band that has no fixed lineup.
Gelb will perform at Griboyedov club on Thursday.

<em>— By Sergey Chernov</em>

TITLE: A tale of two maestros
AUTHOR: By Olga Sharapova
PUBLISHER: The St. Petersburg Times
TEXT: This weekend brings the Italian conductor Gianandrea Noseda to St. Petersburg as part of the 17th Stars of the White Nights festival. Under Noseda’s baton, the soloists and symphony orchestra of the Mariinsky Theater will perform Beethoven’s Coriolan overture and Symphony No. 9 on Saturday at the theater’s concert hall on Ulitsa Dekabristov.
The program of this year’s festival, which every year attracts a wealth of stars and ensembles from over the world, presents more than 100 music, opera and ballet performances. Rene Pape, Anna Netrebko, Dmitri Hvorostovsky, Yuri Bashmet and the Jose Antonio Ballet Company are some of the artists headlining in 2009. The cultural marathon kicked off on May 21 and runs for almost two months through July 19, demanding a great deal of energy and financing from the festival’s organizers. 
One of the focuses of this year’s event is German music, with the program including performances of five piano concertos, symphonies and opera fragments written by Beethoven. The Mariinsky Theater’s renowned principal conductor and artistic director Valery Gergiev will premier an updated stage version of all four parts of Richard Wagner’s tetralogy “Der Ring des Nibelungen” from July 4 to 7. 
Noseda has a wealth of experience in conducting Beethoven’s compositions, and chose the Ninth Symphony for its enduring popularity. “When we talked with maestro Gergiev about the program of my participation during the festival, our goal was to attract both Russian and foreign audiences,” he said. “I think such a famous and timeless symphony as Beethoven’s Ninth is the best gift for all listeners.” 
Noseda has collaborated closely with the Mariinsky Theater since 1997, when he was invited to become the first foreign principal guest conductor in Russia. He also took part in establishing the Mariinsky’s Young Philharmonic Orchestra and was for a long time its principal conductor. 
 “I think my cultural background and method of conducting is very close to Russian music traditions,” said Noseda of his long relationship with Gergiev’s company. “At the same time I can offer various foreign repertoires for the Mariinsky Theater, including, of course, Italian music.” 
Bellini’s “La sonnambula” (premiered here in 1998), Mozart’s “Cos? fan tutte” (2002) and Puccini’s “Il trittico” (2003) have all made their St. Petersburg debuts under Noseda’s lead. The conductor is also popularizing Russian music abroad, and in 2002 conducted Prokofiev’s “War and Peace” at New York’s Metropolitan Opera. 
“I could say that cooperating with Valery Gergiev has helped to open the doors to many venues, and though I can’t now unfortunately conduct here as often as I would like, I am trying to use every opportunity to come to St. Petersburg,” said Noseda. “I come to the Stars of the White Nights festival every summer. Now I am also an artistic director of the Stresa Festival in Italy, and from this position I can confirm the high level of the music forum in St. Petersburg.”
After his successful debut at the Mariinsky Theater, Noseda launched his international career and is now chief conductor of the BBC Philharmonic in Manchester and has received numerous invitations from different theaters and orchestras in Europe and the U.S. Since 2002 Noseda has been signed to Chandos records. Among his works are recordings of Respighi, Prokofiev, Dvorak, Smetana, Shostakovich, Rachmaninoff and others. Noseda also worked on opera star Anna Netrebko’s first album for Deutsche Grammophon. 
Speaking about his future plans in Russia, the Italian conductor said it would be clear after his forthcoming meeting with Gergiev. “But I hope,” he added, “that I will come as usual to the next Stars of the White Night festival.”

TITLE: Velvet underground
AUTHOR: By Shura Collinson
PUBLISHER: Staff Writer
TEXT: Despite its prime position bang in the middle of Nevsky, Grand Cafe FR opened fairly inconspicuously at the beginning of this year. It has risen to prominence with the arrival of the summer however, which brought with it the emergence of several extremely tempting white sofas and tables onto the pavement. 
If people-watching was a sport, the Grand Caf?’s small terrace would be the equivalent of a black ski slope, offering an intimate safari of the crowds jostling their way down the city’s main street. For those unperturbed by the proximity of the hoi poloi and Lada fumes, booking a table is recommended, as the outdoor sofas are fast to fill up.
Inside, there is no sign of anything white, or indeed the White Nights themselves, as the small basement windows are concealed by netting, and the design is dominated by a deep, rich burgundy color. Heavy velvet curtains trimmed with black lace divide the entrance and bar from the other rooms, red and gold rugs carpet the floor, and lampshades decorated lavishly with red beads do little to light up the interior. 
If this is already sounding ever so slightly OTT, the presence of a large flat screen TV, framed incongruously in an ornate gold frame and showing nothing but irritating images of constellations, did little to help. The ambience was topped off by loud Russian house music.
The abundance of red velvet and black lace would not have looked out of place in a brothel, but the design seems less mysterious when regarded in the context of FR's self description: Restaurant, Dj-Caf?, Night Club. Suddenly the dim lighting, energetic music and color-changing panels behind the bar seem less bewildering.
The choice of dishes is refreshingly small, and focused on Italian and French cuisine, with plenty to please seafood aficionados. Those watching their waistlines will be gratified — or mortified — by the inclusion of calorific content figures on the menu.
 Beef Carpaccio was declared good value for money at 310 rubles ($10) — the amount of meat was certainly generous, though it could have benefited from more lettuce to complement it. That was, however, its only flaw, and the accompaniment of fresh Parmesan flakes, capers, sundried tomatoes and drizzled pesto was an excellent touch.
The presentation at Grand Caf? FR cannot be faulted, and the plentiful, fresh and highly agreeable tomato and Mozzarella salad (280 rubles, $9) was no exception. 
The service, however, did leave something to be desired. The solitary, sassy waiter announced after a scandalously long wait for the dessert menu that there were in fact only two in existence, neither of which could currently be found. Nor was service quick, though the food did not disappoint and turned out to be well worth the wait.
Risotto with vegetables (350 rubles, $11) was magnificent — hearty and full of flavor with a rich sauce, and decorated with pesto and balsamic sauce. Caesar salad with chicken (290 rubles, $9) was colossal, and thus easily sufficient as a main course. Crisp, fresh and liberally sprinkled with Parmesan shavings, it was the perfect summer bite, and went well with a glass of chilled white Chateau de Micouleau Bordeaux at 250 rubles ($8) a glass from FR’s small yet diverse wine menu.

TITLE: Mousavi Calls for Rally to Mourn Protesters
AUTHOR: By Ali Akbar Dareini and Nasser Karimi
PUBLISHER: The Associated Press
TEXT: TEHRAN, Iran — Opposition leader Mir Hossein Mousavi called his followers back into the streets of Tehran Thursday for another mass rally over Iran’s disputed presidential election and urged them to wear black to mourn those killed in clashes.
The call for opponents of President Mahmoud Ahmadinejad to rally again was in open defiance of the country’s supreme leader, who has urged the nation to unite behind the Islamic state. It came a day after tens of thousands marched silently down a main street of the capital, brandishing posters of Mousavi and waving V-for-victory signs, amateur video showed. Some covered their mouths with masks.
International news organizations have been banned from covering the protests over last Friday’s election, which the government declared hard-line President Mahmoud Ahmadinejad won by a landslide. Mousavi and his supporters claim Friday’s election was rigged and he was the true winner.
On Monday, hundreds of thousands turned out in a huge procession that recalled the scale of protests during the 1979 Islamic Revolution. Seven demonstrators were shot and killed that day by pro-regime militia in the first confirmed deaths during the unrest.
Mousavi’s Web site said he may join the rally Thursday in downtown Tehran. The protest would be the fourth straight day of major marches in the capital — rallies that recalled the unrest three decades ago that brought down Western-backed Shah Mohammad Reza Pahlavi and propelled the Islamic clergy to power.
The street protests have presented one of the gravest threats to Iran’s complex blend of democracy and religious authority since the system emerged out of the Islamic revolution. But the chances of bringing down the Islamic system appear remote. The ruling clerics still command deep public support and are defended by Iran’s most powerful military force — the Revolutionary Guard — as well as a vast network of militias.
But Mousavi’s opposition movement has forced the country’s supreme leader, Ayatollah Ali Khamenei, into the center of the escalating crisis, questioning his role as the final authority on all critical issues.
Iran’s main electoral authority has said it was prepared to conduct a limited recount of ballots at sites where candidates claim irregularities. The re-count would be overseen by the Guardian Council, an unelected body of 12 clerics and Islamic law experts close to Khamenei.
Mousavi alleges the Guardian Council is not neutral and has already indicated it supports Ahmadinejad. He wants an independent investigation.
On Thursday, state radio reported that the council has invited Mousavi and two other candidates who ran against Ahmadinejad to a meeting early next week. It did not say exactly when or where the meeting would take place.
Another pivotal figure in the escalating drama is former President Hashemi Rafsanjani, who heads the Assembly of Experts — a cleric-run body that is empowered to dismiss the supreme leader.
Rafsanjani was a fierce critic of Ahmadinejad during the election, but has not publicly backed Mousavi. Iranian TV showed pictures of Rafsanjani’s daughter, Faezeh Hashemi, speaking to hundreds of Mousavi supporters on Wednesday.
For the moment, protesters have focused on the results of the balloting rather than challenging the Islamic system of government. But a shift in anger toward Iran’s non-elected theocracy would sharply change the stakes. Instead of a clash over the June 12 election results, it would become a showdown over the foundation of Iran’s system of rule — the almost unlimited authority of the clerics at the top.
On Thursday, Mousavi’s Web site said that both Mousavi and former reformist President Mohammad Khatami sent a joint letter to Iran’s head of judiciary, Ayatollah Mahmoud Hashemi Shahroudi, asking him to take measures to stop violence against protesters by police and help to release detained demonstrators.
The Iranian government has directly accused the United States of meddling in the deepening crisis. A statement by state-run Press TV blamed Washington for “intolerable” interference. The report, on Press TV, cited no evidence.
“Despite wide coverage of unrest, foreign media have not been able to provide any evidence on a single violation in the election process,” state radio said Thursday.
President Barack Obama said he shared the world’s “deep concerns” but it was “not productive, given the history of U.S.-Iranian relations, to be seen as meddling.”
The two countries severed diplomatic relations after militants seized the U.S. Embassy in Tehran following the 1979 Islamic Revolution that toppled the Shah.
A crackdown on dissent continued, with more arrests of opposition figures reported. The country’s most powerful military force — the Revolutionary Guard — said Iranian Web sites and bloggers must remove materials that “create tension” or face legal action.
The government has blocked certain Web sites, such as BBC Farsi, Facebook, Twitter and several pro-Mousavi sites that are vital conduits for Iranians to tell the world about protests and violence. Many other sites, including Gmail and Yahoo, were unusually slow and rarely connect.
Mousavi has condemned the blocking of Web sites, saying the government did not tolerate the voice of the opposition.

TITLE: N. Korea May Fire a Missile Towards 
Hawaii
AUTHOR: By Hyung-Jin Kim
PUBLISHER: The Associated Press
TEXT: SEOUL, South Korea — North Korea may fire a long-range ballistic missile toward Hawaii in early July, a Japanese news report said Thursday, as Russia and China urged the regime to return to international disarmament talks on its rogue nuclear program.
The missile, believed to be a Taepodong-2 with a range of up to 4,000 miles (6,500 kilometers), would be launched from North Korea’s Dongchang-ni site on the northwestern coast, said the Yomiuri daily, Japan’s top-selling newspaper. It cited an analysis by the Japanese Defense Ministry and intelligence gathered by U.S. reconnaissance satellites.
The missile launch could come between July 4 and 8, the paper said.
While the newspaper speculated the Taepodong-2 could fly over Japan and toward Hawaii, it said the missile would not be able to hit Hawaii’s main islands, which are about 4,500 miles (7,200 kilometers) from the Korean peninsula.
A spokesman for the Japanese Defense Ministry declined to comment on the report. South Korea’s Defense Ministry and the National Intelligence Service — the country’s main spy agency — said they could not confirm it.
Tension on the divided Korean peninsula has spiked since the North conducted its second nuclear test on May 25 in defiance of repeated international warnings. The regime declared Saturday it would bolster its nuclear programs and threatened war in protest of U.N. sanctions taken for the nuclear test.
U.S. officials have said the North has been preparing to fire a long-range missile capable of striking the western U.S. In Washington on Tuesday, Gen. James Cartwright, vice chairman of the Joint Chiefs of Staff, said it would take at least three to five years for North Korea to pose a real threat to the U.S. west coast.
President Barack Obama and South Korean President Lee Myung-bak met in Washington on Tuesday for a landmark summit in which they agreed to build a regional and global “strategic alliance” to persuade North Korea to dismantle all its nuclear weapons. Obama declared North Korea a “grave threat” to the world and pledged that the new U.N. sanctions on the communist regime will be aggressively enforced.
In Seoul, Vice Unification Minister Hong Yang-ho told a forum Thursday that the North’s moves to strengthen its nuclear programs is “a very dangerous thing that can fundamentally change” the regional security environment. He said the South Korean government is bracing for “all possible scenarios” regarding the nuclear standoff.
The independent International Crisis Group think tank, meanwhile, said the North’s massive stockpile of chemical weapons is no less serious a threat to the region than its nuclear arsenal.
It said the North is believed to have between 2,500 and 5,000 tons of chemical weapons.

TITLE: 20 Including Somali Official Killed in Bombing
PUBLISHER: The Associated Press
TEXT: MOGADISHU, Somalia — A suicide bombing outside a hotel in western Somalia killed at least 20 people Thursday including the national security minister. The Somali president accused al-Qaida of being behind the attack.
Witness Mohamed Nur said a small car headed toward the gate of the Medina Hotel in Belet Weyne, then drove into vehicles leaving the hotel and exploded.
Information Minister Farhan Ali Mohamud announced the death of National Security Minister Omar Hashi Aden but declined to give any other details.
Somalia’s president accused al-Qaida of being behind the bombing, which he said also killed a senior Somali diplomat.
“It was an act of terrorism and it is part of the terrorist attack on our people,” Sheik Sharif Sheik Ahmed told journalists in the capital. “Al-Qaida is attacking us.”
Experts have expressed fears that foreign Islamic militants could use Somalia as a base for terror in the region.
Al-Shabab, an extremist Islamist group in Somalia, is considered by the U.S. State Department to be a terrorist organization with links to al-Qaida. Al-Shabab has denied the links.
The United States accuses al-Shabab of harboring al-Qaida-linked terrorists who allegedly blew up U.S. Embassies in Kenya and Tanzania in 1998. The United States has attempted to kill suspected al-Qaida members in Somalia several times with airstrikes.
Somalia has not had an effective government for 18 years after warlords overthrew a longtime dictator and plunged the country into anarchy and chaos. The lawlessness has also allowed piracy to thrive off the country’s coast, making Somalia the world’s worst piracy hotspot.
Islamic insurgents have been trying to topple Somalia’s weak, Western-backed government for more than two years. There was a surge of violence in May, during which almost 200 people were killed. The U.N. says the conflict has displaced more than 122,000 people.
At least 17 people were killed in overnight battles between Islamic insurgents and government forces in Mogadishu, witnesses said Thursday.
Information Minister Farhan Ali Mohamed denied the government targeted residential areas, adding government forces were only defending themselves.
An insurgent spokesman, Hassan Mahdi, said his side did not attack any government positions but were defending themselves. Mahdi said once the insurgents repulsed the government forces then the government side started shelling residential areas.
Neither spokesman gave any casualty figures. Mogadishu does not have any clearly defined battlegrounds and both sides’ forces are located close to residential areas.

TITLE: Clinton Fractures Elbow in Fall 
In Washington
PUBLISHER: The Associated Press
TEXT: WASHINGTON — Secretary of State Hillary Rodham Clinton fractured her right elbow during a fall Wednesday, her chief of staff said.
Clinton was on her way to the White House when she fell and injured her elbow, chief of staff Cheryl Mills said in a statement released late Wednesday.
Clinton was treated at The George Washington University Hospital, just a few blocks from State Department headquarters, before going home. She will undergo surgery to repair her elbow in the coming week, Mills said.
“Secretary Clinton appreciates the professionalism and kindness she received from the medical team who treated her this evening and looks forward to resuming her full schedule soon,” Mills said.