SOURCE: The St. Petersburg Times
DATE: Issue #1628 (89), Tuesday, November 23, 2010
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TITLE: New NATO Era Clouded By Uncertainty
AUTHOR: By Nabi Abdullaev
PUBLISHER: The St. Petersburg Times
TEXT: MOSCOW — NATO and Russia declared an end to an era of confrontation at a summit in Lisbon on Saturday, but uncertainty lingers over how they can move their current cooperation on terrorism and fighting drug trafficking to the areas of nuclear security and missile defense.
“It is a very important stage of building productive, full-fleshed and partnership relations between Russia and NATO,” President Dmitry Medvedev told reporters after the NATO-Russia summit Saturday.
A day earlier, NATO adopted a new strategic concept that officially says the alliance no longer considers Russia a threat and pledges to expand security cooperation with Moscow.
NATO Secretary-General Anders Fogh Rasmussen was even more upbeat Saturday, calling the summit “historic” and a “fresh start” in the alliance’s relations with Moscow.
U.S. President Barack Obama, in an article published on Gazeta.ru on Friday, said NATO-Russia relations should undergo the same “reset” that U.S.-Russian relations have experienced since spring 2009.
Relations grew seriously strained after a brief 2008 war between Russia and Georgia, a staunch U.S. ally that has actively sought NATO entry in recent years.
On Friday, NATO’s 28 member states agreed to jointly develop an anti-missile shield over Europe that soured relations between Moscow and Washington during George W. Bush’s presidency, and Medvedev said Saturday that Russia could join the effort.
But Medvedev voiced reservations over whether NATO partners had grasped the shield plan in all its tricky details, and he said Russia would cooperate on the condition of being an equal partner in the system.
“Our participation should be absolutely of that of equals. … We either participate in full, exchange information and are responsible for solving this or that problem, or we don’t participate at all,” Medvedev said. “But if we don’t participate at all, then we for obvious reasons will be forced to protect ourselves.”
Medvedev also said: “It is quite evident that the Europeans themselves do not have a full understanding of how it will look, how much it will cost. But everybody understands that the missile defense system needs to be comprehensive.”
Russian officials had opposed to the U.S.-led shield plan, saying it would undermine its capacity for a nuclear retaliation strike if Russia were attacked first. Washington has maintained that it needs the shield to protect the United States and its European allies from potential missile strikes by Iran or other rogue countries.
Vladimir Putin, during his presidency, and top U.S. officials proposed several times that a radar station in Armavir of the Krasnodar region and a Russian-rented radar in Azerbaijan be integrated into the future anti-missile system. But the Americans would not concede to a demand from Moscow for joint control over the entire system.
Medvedev said Saturday that Russia has formulated several ideas on how a joint system should work and that he had offered them to NATO leaders for their consideration at the summit.
NATO and Russia agreed Saturday to discuss — among their military top brass — the possibilities of further cooperation in this area. Russian and NATO defense ministers will meet in June to review progress of the joint analysis.
“So far we even have a different perception of the nature of the threats,” said Alexander Konovalov, head of the Institute of Strategic Assessments, a security think tank in Moscow. “For example, Washington views Iran as a real and nearly immediate threat, but Moscow believes that it will take years for Iran to develop long-range missiles.”
He predicted that the Americans would never give Russians the right to block a decision to use the European missile shield to respond to a possible missile attack. But, he said, they may well concede to the presence of Russian officials at the control facilities.
Still, Obama praised Medvedev’s decision to join the initiative, saying it “turns a source of past tensions into a source of potential cooperation against a shared threat.”
Medvedev said in Lisbon that he met with the Iranian leader Mahmoud Ahmadinejad at a Baku summit on Thursday and urged him to fully disclose his country’s nuclear program to international watchdogs.
Another problematic issue raised by Medvedev at the Lisbon summit was the risk that the U.S. Senate might fail to ratify the New START treaty that he and Obama signed in April.
Six NATO nations called on the U.S. Senate on Saturday to ratify the treaty, which aims to cut both counties’ nuclear stockpiles and allow inspections of each other’s nuclear facilities. NATO leaders said approval of the document would ease security concerns in Europe.
On Saturday, NATO and Russia signed a joint statement that said the two sides share “common important interests and face common challenges.”
In the document, Russia pledged to increase cooperation with NATO in its war in Afghanistan, offering to expand capacities for the transit of goods and personnel over its territory and more Russian helicopters and training for pilots in the Afghan military. Russia also agreed to set up a new training program for anti-drug officials from Afghanistan and other Central Asian states.
Medvedev told reporters Saturday that NATO and Russia still seriously disagree over the 2008 war with Georgia and Russia’s subsequent recognition of independence for Abkhazia and South Ossetia, Georgia’s two separatist republics. He said, however, that the disagreement would not hinder cooperation between Moscow and the alliance.
Meanwhile, the new NATO strategy approved Friday states that the alliance’s doors are open to new members.
Moscow has complained about NATO expansion, which has brought its members right up to Russia’s borders.

TITLE: Deputies Move To Raise School Security
AUTHOR: By Galina Stolyarova
PUBLISHER: The St. Petersburg Times
TEXT: In the wake of the scandal around local teacher Olga Kharitonova, who was severely beaten by the stepfather of a first-grade pupil in front of her class, the St. Petersburg Legislative Assembly is considering providing 400 million rubles ($12.9 million) in funding to equip all local schools and kindergartens with video-surveillance.
Kharitonova, who spent the last three weeks on sick leave after being attacked, returned to work Monday.
On Oct. 26, Andrei Petrov, the stepfather of one of Kharitonova’s pupils, first-grader Mila Kononenko, entered the school’s premises, and, upon spotting Kharitonova, attacked her without saying a word, in front of her 6-year-old pupils. Kharitonova sustained a concussion and multiple bruises.
A criminal case against Petrov is currently in progress.
School No. 339, where Kharitonova works, is equipped with video cameras, and the attack on her was recorded, which made the investigation process easier.
Oleg Nilov, head of the Judicial Commission of the city parliament, says that if video surveillance is installed in all schools and signs posted on every school gate to indicate their presence, the measure would effectively reduce the level of violence in local schools and serve as a preventive tool.
“Had Petrov known about the video surveillance, he would not have dared to attack the young woman, especially in front of her little pupils, who endured a great shock,” Nilov said. 
Nilov said he would throw his weight behind the initiative to install video surveillance in all schools. “I cannot say how soon the city will be able to find the money, but I am convinced that this is a high priority issue,” the lawmaker said.
After the Beslan hostage tragedy in 2004, in which hundreds of schoolchildren and their relatives were taken hostage by terrorists, security became a serious concern for many schools across Russia. St. Petersburg schools, both public and private, began installing their own security systems, in addition to putting guards on the gates at practically every local school. When the city government isn’t able to help, local companies and even political parties provide funding for security systems.
St. Petersburg has more than 900 schools and 1,139 kindergartens and pre-school centers. At present, only about 700 of them have video-surveillance.
The teacher, who initially resigned after she was attacked, reportedly changed her mind after learning that the pupil was being transferred to another school. Kharitonova, 
who has received financial compensation from her school, had said she would find it difficult to continue teaching Mila Kononenko after the trauma that she suffered as a result of the attack.
“This incident speaks volumes about the defenseless state of Russian schools, where it is not uncommon to find drugs being sold in toilets, and where fights between pupils themselves often get out of hand,” said Irina Smirnova, a retired school teacher. 
“I am not so naive as to believe that surveillance systems would put an end to the sale of drugs or to violence in the city, but they would certainly help to make schools much safer places.”

TITLE: Protesters Throw Eggs at Gay Rights Demonstrators
AUTHOR: By Sergey Chernov
PUBLISHER: The St. Petersburg Times
TEXT: Protesters holding Orthodox Christian church banners and icons, singing prayers and throwing eggs helped to bring the city’s first authorized lesbian, gay, bisexual and transgender (LGBT) demo to an abrupt end in St. Petersburg on Saturday.
According to organizer Maria Yefremenkova, around 20 counter-demonstrators were already at the site of the planned demo when around 10 LGBT activists arrived. 
“They stood there and sang the Lord’s Prayer and some psalms, but the main problem was a bunch of highly aggressive middle-aged men, who were indignant that the police were not dispersing us, but protecting us,” she said.
“They shouted insults and threats throughout the event.”
Later on, a group of 40 men approached the demo, stopped 20 meters away from it and began throwing eggs at the participants, despite the police presence. According to Yefremenkova, the officers looked at a loss for a while, but then detained some of the attackers.
With the police distracted, the men standing near the demo rushed at protesters, seizing a rainbow flag and banners, tearing down a stand and starting to trample it, she said.
The police said 10 were detained and charged with “disorderly conduct.”
Yefremenkova said that activists recognized some of the attackers as belonging to nationalist organizations such as the Russian Imperial Union Order and People’s Council (Narodny Sobor).
According to Yefremenkova, the demo was stopped 40 minutes after it had begun, when a representative of the district administration approached the organizers and asked them to discontinue the event for security reasons.
“It was even said that if we didn’t stop it ourselves, they would stop the event because the security of participants was under threat,” she said.
“They offered to transport us in their bus, which was perfect for us, because we hadn’t thought about how we would leave the scene. The protesters were telling us, ‘You’ll have to go home eventually,’ and making other such threats.”
The demo was timed to mark the United Nations’ International Day for Tolerance, observed on Nov. 16.
Yefremenkova said that the activists had prepared a performance portraying the history of their relationship with bureaucrats, Orthodox believers and judges, but had no chance to perform it.
“They are three sources of homophobia, we believe,” she said.
According to Yefremenkova, the police failed to fully protect the activists. “Considering the nature of the event, they should have surrounded us and acted more decisively in regard to the provocateurs,” she said.
City Hall and local district administrations had repeatedly refused to sanction any LGBT rights rallies until this month. Each of the nine locations proposed for a gay pride event in June was rejected by the authorities on various grounds that the activists described as “derisive.” Five activists were detained when 19 protesters tried to hold a demo without a sanction.
According to Yefremenkova, the Moskovsky district administration refused to authorize a small rally as late as last month.
Last month, a St. Petersburg court ruled that City Hall’s ban of June’s gay pride event was illegal, while the European Court of Human Rights ordered Russia to pay damages to a gay rights activist for unlawful discrimination by the Moscow authorities, who repeatedly denied him and other activists the right to hold gay pride marches.
Yefremenkova said that in authorizing Saturday’s event, the authorities may have been influenced by the court rulings and the rally’s theme of tolerance. “We do have a tolerance program in St. Petersburg, even if the issue of homophobia is not featured in it in any way,” Yefremenkova said.

TITLE: Deputy Yegiazaryan Found Living in Beverly Hills, U.S.
PUBLISHER: The St. Petersburg Times
TEXT: MOSCOW — State Duma Deputy Ashot Yegiazaryan is living in the United States and is ready to cooperate from there with investigators pressing fraud charges against him, his lawyer said Friday.
“[He] is hiding from nobody and has officially stated his address and his U.S. lawyers’ contacts,” lawyer Dmitry Barannikov told Interfax.
Yegiazaryan ignored a summons to show up for questioning at the office of the Investigative Committee on Friday, said Yegiazaryan’s party, the Liberal Democratic Party, or LDPR.
Instead, he had sent the Investigative Committee a letter in which he explained that he could not return to Russia because he feared for his life, the Duma’s LDPR faction said in an e-mailed statement.
In the letter, a copy of which was obtained by The St. Petersburg Times, Yegiazaryan writes that he has been living in the affluent city of Beverly Hills, California, since the beginning of July.
His lawyer, Barannikov, said investigators could easily question the lawmaker on the basis of a U.S.-Russian treaty over legal assistance.
Yegiazaryan, who has served as a deputy since first being elected on the nationalist LDPR ticket in 1999, was stripped of his parliamentary immunity earlier this month after being accused of defrauding two business acquaintances of about 2 billion rubles ($66 million).
He has said the accusations are fabricated and linked them to widespread corruption in the country.

TITLE: In Brief
TEXT: <strong>Tourists Killed in Egypt</strong>
ST. PETERSURG (SPT) — Nine tourists, including several Russians, were killed and 36 others were injured in Egypt after an overloaded bus flew off the highway and flipped over several times Friday evening, RIA-Novosti reported Sunday.
The bus, owned by a small company in Hurghada, carried tourists from Russia, Germany and Ukraine who had booked a tour to Cairo, the local governor said, adding that the bus was going well above the speed limit.
Not all the bodies were identified as of Sunday evening, but reports said at least four Russians and two Ukrainians were killed. The driver, Ali Yusef Mustafa, 39, was hospitalized, with prosecutors waiting to question him.

<strong>Beketov Attends Rally</strong>
ST. PETERSURG (SPT) — Journalist Mikhail Beketov, who was brutally beaten in 2008, joined about 150 protesters at a rally Sunday on Pushkin Square in Moscow to demand full investigations into attacks on reporters and activists, RIA-Novosti reported.
Kommersant reporter Oleg Kashin and environmental activist Konstantin Fetisov were both beaten earlier this month. They criticized the partial destruction of Moscow region’s Khimki forest, a project also opposed by Beketov, editor of a Khimki newspaper who lost a leg and sustained brain damage in an unsolved 2008 attack.

<strong>Putin to Host Call-In</strong>
ST. PETERSBURG (SPT) — Prime Minister Vladimir Putin will hold his ninth annual live conference call with the public in December, his spokesman Dmitry Peskov said Friday.
Peskov did not specify the exact date or say which channels would broadcast the event. Last year, the state-controlled Rossia One and Rossia-24 television channels and Mayak and Radio Russia radio stations covered the conference.

TITLE: Israeli Wanted in Colombia Released From Moscow
PUBLISHER: Combined Reports
TEXT: An Israeli wanted in Colombia for training militias that killed hundreds returned home Saturday after he was released from a Moscow jail, disappointing activists and victims who have tried for years to bring him to justice.
Yair Klein is accused of training far-right paramilitary groups in the 1980s that stole land and murdered Colombians during a decade-long reign of terror across the countryside.
Klein appeared tired and defiant as he left the airport terminal in Israel early Saturday. He wore a khaki-colored sweater and beige pants and carried his own luggage. He told Israeli media that he missed women most of all during his stint behind bars.
At first he was hostile to the swarming reporters, then thanked them for assisting in his release. He also hinted at U.S. and Russian conspiracies.
Klein was arrested in August 2007 as he touched down in a Moscow airport. The Prosecutor General’s Office attempted to extradite him to Colombia, but after years of litigation, it accepted a nonbinding ruling by the European Court of Human Rights in April that said Klein should not be extradited out of concerns that he would not receive a fair trial.
Klein spoke briefly to Israel’s Channel 2 television outside the prison in Moscow, saying Russia had arrested him without a valid legal reason as he arrived on a business trip. He said the Russians apparently hoped to strike a major arms deal with Colombia and wanted to please its government by handing him over.
“I was arrested in order to blackmail me and do some kind of deal with Colombia,” he said, speaking in Hebrew. “All of a sudden I became a bargaining chip.”
Klein complained about harsh prison conditions and said his hand had become paralyzed because of nerve damage. He blasted the Israeli authorities for failing to help get him out.
“Now I need to start making a living from scratch,” Klein said, adding that he plans to publish two books that “will cause chaos in Israel.”
Speaking about Klein’s imminent return to Israel earlier this month, the country’s foreign minister, Avigdor Liberman, said he was grateful for the “human act of good will.”
Klein’s Israeli lawyer Mordechai Tzivin told the Jerusalem Post in September that Liberman had done “all he could” to return Klein to Israel.
Russia’s decision to release Klein and send him to Israel shows that he was insignificant for national security, said Igor Korotchenko, an analyst with the Center for Analysis of International Arms Trade, a Moscow think tank.
“Russia’s national interests come first, but it turned out that he was not interesting to the country because he wasn’t a significant figure, like Viktor Bout,” Korotchenko said.
Bout, a suspected arms dealer, was extradited from Thailand to the United States despite Russia’s objections on Tuesday. He is accused of attempting to kill U.S. citizens and arms trafficking.
Klein was convicted in Colombia of helping set up training camps to teach private armies working for drug lords Pablo Escobar and Gonzalo Rodriguez Gacha about explosives, car bombs and high-profile killings. The armies later morphed into Colombia’s right-wing death squads.
Klein, a former lieutenant colonel in the Israeli army, appeared in a 1998 video used to train far-right squads.
In 1991, he was convicted of selling arms to Colombia’s illegal groups and fined $13,400 by an Israeli court. He also spent 16 months in a Sierra Leone prison in 1999 for his role in a guns for blood diamonds deal.
In an interview with Caracol television conducted in Israel and broadcast in 2007, Klein denied ever working with the cocaine cartels, but confirmed that he did instruct the far-right death squads in how to combat the leftist insurgency.
He said he was originally hired — with the Colombian Defense Ministry’s blessing — to organize security for the banana industry in the northern region of Uraba.
Many of his students went on to carry out some of Colombia’s most brutal massacres.
Klein maintained, however, that “they were not trained to kill, only trained to defend themselves.”
Ivan Cepeda, of the Bogota-based National Movement of Victims of State Crimes, described Klein’s release as a painful blow.
“There are the many victims of the paramilitary groups who were trained by this man,” he said. “It hurts, that after so many efforts, Yair Klein enjoys freedom.”
Colombian officials said they would still try to extradite the former Israeli military officer, who was sentenced in absentia in 2001 to almost 11 years jail. Israel, however, is not likely to agree to ship off one of its citizens to trial elsewhere.
Human rights activists are pleading with Israel to open an investigation into Klein’s actions in the hopes that he could be tried locally.
“Israel should not be a safe haven for somebody who is implicated in atrocities in Colombia,” said Jose-Miguel Vivanco of the New York-based Human Rights Watch.
(AP, SPT)

TITLE: Flight Turns Back to New York
PUBLISHER: Combined Reports
TEXT: A Delta Air Lines jet bound for Moscow returned safely to New York’s John F. Kennedy International Airport and made an emergency landing after an engine problem. No one was injured.
Delta Flight 30 landed before 6 p.m. Sunday and taxied to the gate, Federal Aviation Administration spokeswoman Holly Baker said. Earlier reports of a fire on one of the plane’s wings were incorrect, she said.
The plane had taken off from the airport and was en route to Moscow when it reported engine problems and turned back, she said. The plane was scheduled to take off at about 4:30 p.m. Sunday and land in Moscow at about 10 a.m. Monday.
The Boeing 767 had 193 passengers and 11 crew members on board, CNN television reported.
The passengers were put on another aircraft several hours later and were expected to arrive at Moscow’s Sheremetyevo Airport on Monday afternoon. The plane’s return flight to New York, Delta Flight 31, which was initially scheduled to depart at 12:10 p.m. Monday, left at 6:18 p.m., according to Delta’s online flight-tracking system.
Atlanta-based Delta did not immediately respond to a call requesting comment.
(AP, MT)

TITLE: In Brief
TEXT: <strong>Woman Decapitated</strong>
ST. PETERSBURG (SPT) — A women’s headless body was found in St. Petersburg’s Pavlov State Medical University, Fontanka.ru web site reported Monday. 
According to the journalistic investigation agency AZhUR, the corpse was that of a 59-year-old secretary of one of the university’s heads of department. 
The police department of the Petrograd district has detained a Chinese citizen on suspicion of committing the crime. The man was formerly a student at the university but was expelled in 2008.
 
<strong>Shepherds Killed</strong>
ST. PETERSBURG (SPT) — Two Georgian sheepherders were shot dead and 500 sheep stolen at a farm located 40 kilometers south of the capital, Tbilisi, the country’s Interior Ministry said Friday, Bloomberg reported.
The sheepherders’ bodies were discovered last week in a field buried in a shallow grave, the ministry said on its web site.

<strong>Indian Attacked</strong>
ST. PETERSBURG (SPT) — An Indian student was attacked by two men when giving them a lift in his car at 3.30 a.m. Sunday, Fontanka reported Monday. The passengers drew an object resembling a pistol on Ahram Mohd, a student at the Forestry Academy,  before throwing him out of the car on Prospekt Kultury and fleeing the scene. 
In addition to the car, the victim reportedly lost his cell phone, a ring and 2,000 rubles.

TITLE: Vienna Judge Wants to Hear Kadyrov
AUTHOR: By Nikolaus von Twickel
PUBLISHER: The St. Petersburg Times
TEXT: MOSCOW — Chechen President Ramzan Kadyrov should be called as a witness in the trial against three men accused of killing Chechen refugee Umar Israilov, a court in Vienna said Friday.
Kadyrov should be heard via a video link, Judge Friedrich Forsthuber said, the national Austria Press Agency reported.
The judge responded to a request from Rudolf Mayer, the lawyer of Otto Kaltenbrunner, who is accused of organizing the brazen shooting of Israilov, 27, on a busy Vienna street on Jan. 19, 2009.
Mayer told the judge that his client would ask his sister to pass the request to Kadyrov and notify the court Monday.
At the opening of the trial Tuesday, prosecutors showed a photo of Kaltenbrunner embracing Kadyrov that was found on Kaltenbrunner’s cell phone.
Mayer has also said he would like to see Prime Minister Vladimir Putin called as a witness.
Putin, who appointed Kadyrov in 2007 as Chechen president, is widely thought to be Kadyrov’s mentor.
Israilov’s lawyer and human rights activists have accused Kadyrov of ordering the killing to silence a vocal critic of the Chechen leadership. Prosecutors say they suspect Kadyrov but do not have enough evidence to implicate him.
Kadyrov himself has vehemently denied any involvement and denounced the allegations as part of a campaign to discredit him.
His spokesman Alvi Karimov said Friday that he could not comment on the trial because he had not followed it.
Kaltenbrunner, a Chechen native who changed his name after arriving in Austria in 2007, told the court earlier in the week that he was a close friend of Kadyrov and had known him since 1998. He denied having anything to do with the murder.
He told the court Wednesday that on the day of the killing Lecha Bogatyryov and Suleiman Dadayev had taken his car to the crime scene while he had been lying drunk in bed.
Bogatyryov, who is believed to be living in Chechnya, is accused of firing the deadly shots at Israilov together with another Chechen, Turpal-Ali Yershukayev.
Dadayev is accused of driving the getaway car, a Volvo registered under Kaltenbrunner’s name, according to the indictment, a copy of which was obtained by The Moscow Times.
Yershukayev told the court that his countrymen betrayed him by asking him to drive to the crime scene that day.
He said Dadayev had asked him to go there, merely saying “a man would come.” After a long wait in his Opel car, he decided to take a short walk when he suddenly heard shots and saw Bogatyryov running past.
Despite his fear, he decided to run after Bogatyryov, whom he claimed to have never met before in his life.
When the gunman suddenly threw his weapon over to him, he tossed it into a garbage can, Yeshurkayev told the jury, Vienna’s Die Presse reported.
Dadayev is expected to be heard Monday, but his lawyer Lennart Binder said last week that he was “a pawn in the murder plans of Putin and his henchman Kadyrov,” Die Presse reported.
All three defendants have pleaded not guilty.
The trial is expected to last until late January.

TITLE: Bout’s Wife Claims She’ll Sue Thailand
PUBLISHER: The Associated Press
TEXT: BANGKOK — The wife of accused Russian arms trafficker Viktor Bout said Monday she will sue Thailand in an attempt to get him released from U.S. custody after the Southeast Asian nation extradited him last week.
At a news conference in Bangkok, Alla Bout also said that her husband would fight the case against him and not cut a deal with U.S. authorities. He pleaded not guilty in New York last week to a conspiracy charge that alleges he illicitly traded arms to a terror group.
There has been speculation Bout holds Russian intelligence he might exchange for leniency. Bout denies that but Moscow strongly opposed his extradition.
Bout, a former Soviet air force officer reputed to have been one of the world’s most prolific arms dealers, allegedly supplied weapons that fueled civil wars in South America, the Middle East and Africa, with clients including Liberia’s Charles Taylor and Libyan leader Moammar Gadhafi and both sides in Angola’s civil war.
He was arrested at a Bangkok hotel in a sting operation in 2008 after U.S. agents posing as Colombian rebels from the Revolutionary Armed Forces of Colombia — FARC — allegedly set up a deal to purchase arms from him. FARC is classified by Washington as a narco-terrorist group.
Bout was charged with conspiracy, accused of agreeing to smuggle missiles and rocket launchers to the FARC, and conspiring to kill U.S. officers or employees. If convicted, he could face a maximum penalty of life in prison and a mandatory minimum of 25 years in prison.
Thailand extradited Bout following a protracted legal battle, during which Moscow and Washington are believed to have pressured the Thai government over the outcome.
Alla Bout said Monday she would take legal actions against the Thai government, Thai Prime Minister Abhisit Vejjajiva and other officials who were responsible for turning over her husband to U.S. authorities.
She and Bout’s lawyer, Lak Nittiwattanawichan, have called the extradition a breach of both international obligations and domestic Thai law. They charge the action was political, carried out before the judicial process had run its course.
“However absurd it might sound to you, we will be trying to make the Thai government — which released Viktor to the hands of the American authorities — bring him back from the United States to Thailand and release him,” Alla told reporters through an interpreter.
On the subject of whether U.S. officials offered him any inducements after he was handed over to their custody, she said that “Viktor told them that he is going to fight his case in court, not take their offer because he believed that he is innocent.”
The alleged offer was not clear. Russia’s Consul General in New York, Andrey Yushmanov, said last week that Bout rejected U.S. pressure during the transfer to confess to what he did not do and was promised “some advantages” in return.
The head of a lucrative air transport empire, Bout had long evaded UN and U.S. sanctions aimed at blocking his financial activities and restricting his travel. He claims he ran a legitimate business and never sold weapons, and fought hard to avoid extradition.
He has been referred to as “The Merchant of Death,” and was an inspiration for the arms dealer played by Nicolas Cage in the 2005 film “Lord of War.”

TITLE: Ex-Kremlin Official Detained On Suspicion of Extortion
AUTHOR: By Alexandra Odynova
PUBLISHER: The St. Petersburg Times
TEXT: MOSCOW — A former official with the Office for Presidential Affairs was taken into custody Friday on suspicion of bribery.
Moscow’s Zamoskvoretsky District Court authorized on Friday the arrest of Vladimir Korniyaka, who together with another former official from the Office for Presidential Affairs, Igor Yerashov, is suspected of extorting a $10,000 bribe while auditing a department in a medical institution that illegally leased out some of its premises for commercial purposes, news reports said.
Korniyaka and Yerashov were responsible for auditing medical institutions registered as presidential property. Yerashov has been in custody since a bribery investigation was opened May 26. If convicted, both face up to 12 years in prison.
The case was opened shortly before a Moscow court essentially declared in June that Kremlin officials were untouchable by rejecting a lawsuit against a member of the presidential administration on the grounds that such complaints infringe on the president’s immunity from prosecution.
It is not the first time that officials of the Office of Presidential Affairs, headed by Vladimir Kozhin, have been put in the spotlight this year.
In July, President Dmitry Medvedev ordered a corruption investigation into Vladimir Leshchevsky, deputy head of construction at the Office of Presidential Affairs, after businessman Valery Morozov accused him of extorting bribes in connection with construction for the 2014 Winter Olympics in Sochi.
No legal actions have been taken against Leshchevsky.
Russia is the world’s most corrupt major economy, according to Transparency International’s 2010 Corruption Perceptions Index, having slid to 154th among 178 countries, on par with Tajikistan and Kenya.

TITLE: Fact Check: Half Truths in START Discussion
PUBLISHER: The Associated Press
TEXT: WASHINGTON — In their showdown over the New START treaty with Russia, Democrats and Republicans are charging each other with undermining national security.
Who’s right?
President Barack Obama’s administration is pushing for a vote this year on New START; Republicans want a delay until a new Congress convenes in January. A closer look at the claims in the debate:

***

THE CLAIM: Opponents say it will limit U.S. options for future missile defense. “New START could hamper our ability to improve our missile-defense system — leaving us unable to destroy more than a handful of missiles at a time and vulnerable to attacks from around the globe,” Republican Senator Jim DeMint wrote in the National Review in July.
THE FACTS: The treaty doesn’t place any practical constraints on missile defense. The document’s preamble, which is not legally binding, acknowledges a link between nuclear weapons and missile defense. It’s an assertion that was accepted by former President George W. Bush’s administration: The point of missile defense is to counteract nuclear-tipped missiles.
Opponents also point to Russia’s assertion in a signing statement that it reserves the right to withdraw from the treaty if the United States significantly boosts its missile defenses. In fact, both sides have the right to withdraw from the treaty for any reason they believe is in their national interest.
The Soviet Union made a similar assertion when leaders signed the original 1991 START treaty, warning the country might withdraw if the United States did not respect the Anti-Ballistic Missile Treaty. But when Bush withdrew from the ABM Treaty in 2001, Russia did not pull out of START. The START treaty held for the same reason it was signed: It was in each country’s national interest.
The treaty does prohibit the conversion of offensive missile launchers to missile defense launchers and vice versa. But military officials say this does not pose any substantive restriction because it would be cheaper to build new missile defense launchers than convert existing offensive ones. 

***

THE CLAIM: Opponents say Russia is likely to cheat and its compliance will be hard to verify. “I think the treaty is weak on verification, especially compared to previous treaties,” Senator Kit Bond, the top Republican on the Senate Intelligence Committee, said on a radio program last month. “We will have much greater trouble determining if Russia is cheating and given Russia’s track record, that’s a real problem.”
THE FACTS: Bond has said that a classified report raises concerns about Russian cheating. That’s impossible to evaluate without seeing the document. But without the treaty, it would be even harder for the United States to make sure Russia is not covertly expanding or improving its nuclear or ballistic missile capabilities. The United States has not had inspectors in Russia checking its nuclear assets since the 1991 START treaty expired in December. The only quick way of getting them back is to bring a new treaty into force.
It’s debatable whether U.S. treaty negotiators got the best terms on how they can conduct inspections, but the treaty followed hard-fought talks. The Soviet Union for years resisted allowing inspections at all. Without inspectors, the United States would have to rely on espionage and satellite monitoring, which are much less effective and more expensive than onsite inspection.

***

THE CLAIM: The treaty’s backers say getting inspectors back on the ground in Russia is so urgent that the United States cannot afford to wait until next year. “This is not about politics,” Obama said Thursday. “It’s about national security. This is not a matter than can be delayed.”
THE FACTS: The urgency is political. Next year the Republican ranks in the Senate will expand by six and it will be much more difficult to ratify the treaty. Even the administration concedes that the security risk is not immediate. “I am not particularly worried, near term,” Obama’s top adviser on nuclear issues, Gary Samore, said Thursday. “But over time, as the Russians are modernizing their systems and starting to deploy new systems, the lack of inspections will create much more uncertainty.”
Intelligence officials have expressed concerns that have sounded less than urgent.
“I think the earlier, the sooner, the better. You know, my thing is: From an intelligence perspective only, are we better off with it or without it? We’re better off with it,” the director of national intelligence, James Clapper, said recently. 

***

THE CLAIM: Republicans, led by Senator Jon Kyl, say they won’t consider the treaty until the Obama administration budgets adequate money for the nation’s nuclear arsenal and the laboratories that oversee them. The treaty would reduce the limits on U.S. and Russian warheads, and Kyl says he needs assurances that the remaining nuclear arsenal is modernized and effective.
THE FACTS: The Obama administration has pledged $85 billion to maintain the nuclear arsenal over the next 10 years, including a $4.1 billion boost recently, in an attempt to address Kyl’s concerns.
The president cannot guarantee Congress, which controls spending, will go along with those figures. Kyl has not said whether he thinks the pledge is enough. But it would lift average spending over the five years beginning 2012 nearly 30 percent over 2010 levels. Even before the administration’s new pledge, Linton Brooks, who oversaw the nuclear laboratories as director of the National Nuclear Safety Administration during the Bush administration, told an audience at a Washington think tank that he “would have killed for” the amount in this year’s budget. 

***

THE CLAIM: The treaty favors Russia because it does not deal with Russia’s much larger arsenal of smaller tactical nuclear warheads intended for use on the battlefield in a conventional war. “New START gives Russia a massive nuclear weapon advantage over the United States. The treaty ignores tactical nuclear weapons, where Russia outnumbers us by as much as 10 to 1,” former Massachusetts GOP governor and 2012 presidential hopeful Mitt Romney wrote last summer in The Washington Post.
THE FACTS: New START is intended to replace the 1991 START treaty, which also did not deal with tactical nuclear weapons. Russian and U.S. officials have both said that issue would be addressed in subsequent negotiations, along with the large number of U.S. warheads now in storage. Those U.S. warheads also were not addressed by New START.
Russia has maintained a large number of such weapons to address weaknesses in its conventional forces. But military analysts are dismissive of the military usefulness of these weapons, given the small chance that the United States and Russia would face off in a conventional war of tanks and combat forces. Talks on tactical nuclear weapons are unlikely to occur unless New START is approved.

TITLE: Astoria Auction Postponed Until Next May
AUTHOR: By Maria Buravtseva and Alla Tokareva
PUBLISHER: Vedomosti
TEXT: The auction of the Astoria hotel building that was scheduled for Nov. 19 was last week postponed until May 25 next year.
The city’s Property Fund had put up for auction the historic building of the Astoria hotel, which has a total area of 16,998 square meters and stands on 0.3 hectares of land, for 2.5 billion rubles, or $80.6 million (2.18 billion rubles excluding VAT). 
The building is currently rented by Gostinichny Komplex Astoria (Astoria Hotel Complex) through 2046 at a fixed rate, which from November 2009 till August 2011 is 3.45 million rubles ($111,000) per month. The controlling stake in the company belongs to the U.K. firm Rocco Forte & Family, which manages 13 luxury hotels in Europe.  
The Astoria hotel has 210 rooms. On Nov. 3, the tenant announced that it was interested in purchasing the building, but that it did not consider the price to be appropriate. Gostinichny Komplex Astoria called in two other companies to get an independent valuation.
The auction has been postponed in order to increase the property’s investment appeal, said Alina Kuberskaya, a spokesperson for the Property Fund. She did not comment on whether the tenant had submitted a bid in the auction or not. The price of the lot will not change, according to the fund.
Representatives of Gostinichny Komplex Astoria and Rocco Forte & Family declined to comment. 
If the property is not sold this year, it will be possible to sell it next year — City Hall does not plan to reduce the price, since the Astoria is a jewel of the city’s real estate market, Andrei Stepanenko, the Property Fund’s director, told Vedomosti at the beginning of November. 
It seems that City Hall is now having doubts that a property encumbered by a long-term lease agreement can be sold for such a high price, said Nikolai Kazansky, general director of Colliers International in St. Petersburg. If the Astoria did not have long-term tenants, its price would have risen to at least 3 billion rubles, he said. 
The lease contract was agreed in 1997 when British hotelier Rocco Forte’s company became the co-owner of the hotel. According to the valuation report posted on the Property Fund’s web site, the rental rate is $609,076 (excluding VAT) per quarter, and the rent can change every five years as agreed by the parties. The valuation was carried out by MEF-Audit company. The company declined last week to comment on the price of the building and the valuation method used.
The market price of the building is estimated at about 1.5 billion rubles, said one real estate consultant who asked not to be named. An employee of the company that valuated Astoria at the request of the tenant said that the property was greatly overpriced.
The president of Avers Group, Mikhail Zeldin, said he did not remember another occasion when an auction had been postponed for such a long time, though he considered the delay to be logical: Astoria requires a longer exposition term. According to Zeldin, there is a higher chance of selling the hotel at this price in May, as interest may come from Western investors, and without their capital, the transaction is not likely to take place. It is a large sum, and long-term funding raised at a low interest rate is needed, he said. The property could attract other investors, so the decision to postpone the auction is understandable, said Boris Moshensky, general director of Maris Properties/CBRE. 
According to Kazansky, in sales of properties such as the Astoria, the tenants themselves are usually interested in purchasing the property.

TITLE: Cigar Smoking Survives and Even Thrives
AUTHOR: By Justin Lifflander
PUBLISHER: The St. Petersburg Times
TEXT: MSOCOW — Imports of handmade cigars should return to pre-crisis levels in 2012 after falling by nearly half last year, Russia’s exclusive importer of Cuban cigars said Thursday.
The country imported 2.2 million handmade cigars in 2008, but supply plummeted 45 percent to 1.2 million last year, according to data from Top Cigars, the Moscow-based company owned by Cuban cigar export monopoly Habanos.
“We’ve maintained our regular customer base of genuine smokers,” said Alexander, a salesman at the Tobacco Gallery shop on Tverskaya Ulitsa in Moscow. “But the crisis definitely reduced the number of customers buying cigars as gifts. I guess they just switched back to chocolates.”
Luxury cigars remain popular among wealthy Russians looking for flavor and exotic ways to spend their cash. Once featured in Soviet propaganda as the hallmark of the evil Western capitalist, the stogie is staging a comeback.
“For some of our smokers, image is even more important than flavor,” said Oleg Chechilov, editor of the magazine Smoke, which has 30,000 readers across the country. He estimates that Russia has 600,000 cigar smokers.
“The typical Russian cigar fan is a male between 30 and 65, smokes once a day, and has a humidor at home,” Tamara Teixo-Balinas, the director of Top Cigars, said at a conference her company was hosting, which included lectures and a competition to pair cigars with expensive alcohol.
Habanos now has more than 70 percent of the Russian market for handmade cigars, slightly above its worldwide average, said Gonzalo Fernandez, the company’s deputy marketing director.
He attributed the cigars’ popularity to Russia and Cuba’s “special historical relationship.” In Soviet times, cigar imports peaked at 13 million per year, though those were mostly machine-made, Fernandez said.
Russia is the second-fastest-growing market for Habanos after China, he said. Cuba has a warehouse with tobacco in reserve and land to grow more if demand continues to rise or the lucrative U.S. market ends its embargo.
The company has built up a network of 260 retailers throughout the country, with stores concentrated in Moscow and St. Petersburg.
Fernandez said anti-smoking trends and hectic lifestyles had not really affected overall sales, although preference for specific types of cigars has been fluid.
Some smokers are choosing shorter and fatter cigars to get the same enjoyment in less time. Those who are smoking less because of the dwindling number of places they are allowed to smoke in are focusing on larger and more flavorful models, he said.
Prices for handmade cigars keep them out of reach for many Russians, at least on a regular basis. The average Cuban Robusto can cost 240 rubles ($8), while the newly introduced Cohiba Behike costs 2,100 rubles ($70) each.
Cigars have a storied history in Russia, where Catherine the Great is credited with inventing the cigar band to protect her fingers from nicotine stains. Vladimir Lenin is also said to have bought cigars on credit at Davidoff’s store in Geneva before returning home to start the Revolution.

TITLE: Megafon Unveils Technology For Metro Payment System
AUTHOR: By Maria Buravtseva
PUBLISHER: Vedomosti
TEXT: Russian mobile network operator Megafon presented new technology Monday that will enable Petersburgers to pay for the metro using their cell phone. Another Russian operator, MTS, and the U.S. firm Ambiq have comparable projects.
The project is based on NFC (Near Field Communication) technology that enables the exchange of data between devices over a small distance. The cost of one journey will be deducted from the cell phone account. A special sticker put on the phone will enable the system to work, while the sim card does not need to be replaced, explained Lyudmila Chekhova, a spokesperson for the northwest branch of Megafon. 
The cost of the service will be determined before its commercial launch, and users will be able to activate the service at the network operator’s office. In terms of technology, Megafon will be ready for the launch by the end of the year, said Chekhova. At the testing stage, investment put up by the company has not exceeded several hundred thousand rubles. 
Finance schemes for cooperating with partners are being developed, she added. Megafon expects the system to be available on all means of urban and suburban transport in the future.
The St. Petersburg Metropolitan is currently testing a similar project by American company Ambiq Technology. In the middle of this year, it submitted a proposal to City Hall to launch a system that would make it possible to make payments with a chip compatible with any cell phone sim card. On March 22, an agreement between Ambiq and the city’s Committee for Economic Development, Industrial Policy and Trade was signed. Metro employees are carrying out the testing, said Maria Azarova, CEO of Ambik Tek SPb, Ambiq’s daughter company in St. Petersburg. 
She does not consider Megafon to be a direct competitor: “Our technology is not connected with the mobile operator’s account; it is based on bank accounts and can be applied more widely. It can be used instead of discount cards or to provide identification when set up to access data bases.” 
The metro is simply the simplest and most effective way of demonstrating the essence of the service to customers, she said. Ambiq will charge commission of no more than 2 percent for selling tickets, Misha Rosenberg, the company’s co-founder, said back in October. The company has invested some $7 million in developing the technology.
The St. Petersburg Metropolitan is ready to cooperate with both Megafon and Ambiq, so passengers look set to have a choice, said a representative of the Metropolitan.
MTS is currently testing a similar project in the Moscow metro, according to Yulia Nemenova, a spokesperson for MTS Northwest. She said that the service could be ready for commercial use by January or February next year.
According to Megafon’s Chekhova, the service could have a large audience, considering the metro’s traffic volume of about 2.3 million people.
Maria Georgievskaya, a spokesperson for Vimpelkom’s St. Petersburg office, said that the mobile network operator was working on developing several options of using NFC technology in cooperative projects with transport companies, banks and major retailers.

TITLE: In Brief
TEXT: <strong>Island Agreement</strong>
ST. PETERSBURG (Vedomosti) — Two days after Roman Abramovich’s company won the tender to redevelop New Holland Island, City Hall concluded an amicable agreement with the former investor of the project. 
In May, the City Property Management Committee (KUGI) petitioned the arbitration court of St. Petersburg and the Leningrad Oblast with a recovery lawsuit of some 578.6 million rubles against the company ST Novaya Gollandiya belonging to Shalva Chigirinsky and Igor Kesayev. 
An investment contract with ST Novaya Gollandiya was signed in 2006 after it won the tender to redevelop the island, but the contract was annulled in March due to inaction on the part of the investor. 
According to Olga Barashkina, a spokesperson for KUGI, the debt has been agreed at 505.3 million rubles, and the company is to pay it back within a year or face a daily 0.02 percent interest penalty. 

<strong>Cash for Pikalyovo</strong>
ST. PETERSBURG (Vedomosti) — The federal budget is to allocate about 532.7 million rubles ($17.1 million) to support a plan for the modernization of Pikalyovo, the press office of the local government reports. The funds are to be spent on roads, energy, housing and public utilities.
The Leningrad Oblast town became notorious last year when residents blocked the federal highway, creating a 438-kilometer traffic jam, in order to protest the fact that the local power station had turned off the town’s hot water. This was in turn a response to residents ceasing to pay their utility bills after the town’s main employer, the BaselCement factory, stopped paying wages to its 2,600 employees.

<strong>Palace Not Sold</strong>
ST. PETERSBURG (Vedomosti) — The auction of the building at 8 Admiralteiskaya Embankment (the former palace of Grand Prince Mikhail Mikhailovich) did not go ahead as planned Friday due to the small number of applications submitted, said Dinara Useinova, the first deputy director for the city’s Property Fund. 
The building, which occupies 5,030.5 square meters with an annex occupying 3,135.9 square meters, was due to be sold together with two plots of land covering a total of 4,085 square meters, with a starting price of 700 million rubles ($22.5 million). According to Useinova, a new auction may be held before the end of the year; the price is currently being discussed. 

<strong>Employers in Debt</strong>
ST. PETERSBURG (Vedomosti) — Seven organizations have admitted to having wage arrears as of Nov. 11. 
A total of 1,771 employees are owed 39.2 million rubles ($1.3 million) — 1.6 times bigger than last month’s figure, according to Petrostat, the St. Petersburg Statistics Bureau.

TITLE: Kudrin Defends Tax Hikes
AUTHOR: By Derek Andersen
PUBLISHER: The St. Petersburg Times
TEXT: MOSCOW — Finance Minister Alexei Kudrin garnered praise for his openness when he spoke Friday at a conference on taxation in Moscow, but his words made few happy: Business will pay more taxes, and by a lot.
New taxes will amount to 2 percent of gross domestic product next year, Kudrin said. Starting in January, companies’ payroll taxes will rise to 34 percent from 26 percent. For small business, they will rise to 34 percent from 14 percent, helping fund a 9 percent increase in pensions.
Rising taxes are “a sign of a weak state,” but they have also become a trend globally, Kudrin said. He said “the government, the president and the parliament” cooperatively made the decision to raise taxes to help end federal budget deficits by 2015.
This year’s budget deficit will likely be 4.7 percent of GDP, which is less than the government’s current estimate of 5.3 percent, Kudrin told the conference.
The government also expects to raise $15 billion from new regulations on the export of oil and petroleum products, Kudrin told reporters after the conference.
Export duties will be eliminated for oil and petroleum products sent to Customs Union partners Belarus and Kazakhstan, but the duties on oil and petroleum products exported from Customs Union countries will rise sharply.
Oil companies may receive a break in the mineral extraction tax, Kudrin said, but gas companies can expect to be charged up to 61 percent more if Finance Ministry plans are finalized.
Russia’s low 13 percent flat tax on personal income will remain unchanged, presidential aide Arkady Dvorkovich promised. He and Sberbank president German Gref spoke along with Kudrin at the conference at the Ritz-Carlton Hotel marking the 20th anniversary of the Federal Tax Service.
Lowering taxes “is a question of political will,” Dvorkovich said, but he admitted that the rising trend could not be reversed in the next three years, since federal budgets for the period have already been drafted.
Gref, a former economic development minister, spoke most passionately in opposition to the tax hikes.
Small business “cannot be stripped naked,” he said. He added that the higher taxes would cancel out his accomplishments as president of Russia’s largest bank. In the last two years, he has reduced the bank’s personnel by 15 percent and instituted a number of cost-cutting measures.
Gref called taxation “a matter of know-how.” The tax service produces 15 tons of documents annually, he said, and not even the tax service’s voluminous staff — estimated by one speaker to be 150,000 people — could read them all.
State Duma Deputy Andrei Makarov, who moderated the meeting, described the increases as “tax terror.”

TITLE: Rusnano In Charge Of Museum
PUBLISHER: Vedomosti
TEXT: MOSCOW — A managerial revolution is underway at Moscow’s Polytechnic Museum, the modernization of which is now Rusnano’s responsibility.
The team of the new director, who calls himself a crisis manager, will have to both pull the institution out of crisis and transform it into a modern museum of science and technology. This demands methods unusual for a typical Russian museum.
The museum had not changed for decades, until it caught the attention of Rusnano head Anatoly Chubais. In 2009, the state corporation set up a non-commercial development fund for the museum. The Polytechnic Museum is “a terrific story that no Silicon Valley could even dream of,” Chubais said.
In August 2010, the museum got a new general director — 69-year-old professor Boris Saltykov, who was science and technology minister from 1991 to 1996. By the time he was appointed, the museum had accumulated too many problems. “It is stuck in the ‘80s,” Saltykov said in an interview with Vedomosti.
“There is no interactivity to the museum displays, no new technologies, there is no marketing or other key departments, which are what maintain the brand image of the world’s famous museums,” said Alexei Lebedev, head of the museum design lab of the Russian Institute of Cultural Science.
Attendance figures are not impressive either: just over 400,000 visitors per year. “Large museums in downtown Moscow usually get more than 1 million,” Lebedev said.

TITLE: Bribe Case Defendant Called Cold War Hero
PUBLISHER: The Associated Press
TEXT: NEW YORK — A businessman once accused of bribing officials in Kazakhstan with tens of millions of dollars was praised as a Cold War hero Friday by a judge who said he helped thousands of Soviet Jews emigrate to the West.
U.S. District Judge William H. Pauley III made the comments about James Giffen, 69, as he sentenced him to time served for a guilty plea to a misdemeanor tax count.
The judge said he delved deeply into classified information for an accurate portrait of a man whose March 2003 arrest generated headlines around the world as he was accused in a 65-count indictment of paying $78 million in bribes to Kazakh officials.
Pauley said investigators and prosecutors did not know the classified information when Giffen was originally charged with violating the Foreign Corrupt Practices Act, along with mail, wire fraud and money laundering statutes.
“Suffice it to say, Mr. Giffen was a significant source of information to the United States government and a conduit for secret communications with the Soviet Union and its leadership during the Cold War,” Pauley said. “He undertook that effort as a volunteer and was one of the only Americans with sustained and reliable access to the highest levels of Soviet officialdom.”
In 1980, Giffen helped facilitate the emigration of thousands of Soviet Jews to the West, Pauley said. After the Soviet Union collapsed, Giffen turned his interest to the new Republic of Kazakhstan and became a trusted adviser to that country’s president, the judge said.
Giffen used his expertise to advise Kazakhstan on foreign investments and provided advice on economic development, helping the country develop its vast natural resources, Pauley said.
“In doing so, he advanced the strategic interests of the United States and American businesses in Central Asia,” Pauley said. “Throughout this time, he continued to act as a conduit for communications on issues vital to America’s national interest in the region.”
The judge said Giffen’s arrest as he was about to fly to Paris from Kennedy International Airport caused an end to important relationships he had built up over a lifetime and forced him to spend millions of dollars on legal expenses that he otherwise “could have spent on his family and charitable pursuits.”
Pauley said Giffen’s wealth had dwindled with the filing of the indictment, which prevented him from traveling internationally and caused him to face the possibility of spending the rest of his years in prison. He was required to post $10 million bail until prosecutors dropped the serious charges earlier this year.
“In the end, at the age of 69, how does Mr. Giffen reclaim his good name and reputation?” the judge asked. Pauley praised the government for reassessing the case and dropping the most serious charges.
Separately, the judge ordered Mercator Corporation, a small New York merchant bank controlled by Giffen, to pay a $32,000 fine for giving two snowmobiles each worth $16,000 in 1999 to a high-level Kazakh official to seek an advantage in contracts. The bank had pleaded guilty to violating the Foreign Corrupt Practices Act.
Pauley said Mercator estimated that it has incurred nearly $10 million in expenses and lost at least $30 million in profits in the prosecution.
The case stemmed from an investigation by the Internal Revenue Service and the FBI into the relationships between Kazakhstan and U.S. executives as lucrative oil deals were negotiated during the 1990s.
The prosecution’s biggest catch was a former senior Mobil Oil Corporation executive, who was sentenced to three years and 10 months in prison in 2003 after admitting he evaded taxes on more than $7 million he earned negotiating oil deals.
An indictment announced against Giffen seven years ago had accused him of making more than $78 million in bribes to two senior Kazakhstan officials in connection with six oil transactions in which four U.S. companies acquired valuable oil and gas rights in Kazakhstan.

TITLE: Turning a Happy Hour Into a Happy Alliance
AUTHOR: By Dmitry Trenin
TEXT: President Dmitry Medvedev has called the weekend NATO summit in Lisbon a historic event. NATO’s new strategic concept stressed that the alliance is no threat to Russia. Moscow has agreed to expand its logistical support for the alliance’s effort in Afghanistan. NATO and Russia have exchanged offers of collaboration on missile defense, which they have decided to explore. This is a strong and useful platform to continue transforming the Russian-Western strategic relationship. Breakthroughs do not abolish processes. Neither quick nor easy, transformation from past enmity to future friendship is nevertheless doable. Here are some tips as to how.
It is good that NATO does not regard itself as Russia’s adversary. But the real issue is whether some of its members still regard Russia as a potential threat to themselves, and whether Russia considers the United States as a long-term security risk. There is still much to be done to remove both concerns. On the Russia-Central Europe track, the current reconciliation with Poland, which Medvedev will be visiting soon, needs to proceed deeper, toward becoming good neighbors. Reconciliation policies also need to expand to include the Baltic states. It is Moscow’s responsibility as well to rid itself of elements of the old Soviet stereotypes of NATO that still remain.
On the U.S.-Russia track, much of the responsibility lies with Washington. NATO leaders have appreciated the importance of the U.S. Senate’s ratification of New START. Senate Republicans, ever proud of being staunch defenders of national security, are now running the risk of casting a wholly different image, of a group that puts its partisan interest above that of the nation. Not a good bumper sticker for the 2012 elections. While New START’s fate is being decided, however, the reset should not be placed on pause. There is much that Washington and Moscow can achieve together along a broad front covered by a bilateral presidential commission.
Missile defense, of course, stands out among the areas of cooperation between the United States, NATO and Russia. If successful, this cooperation will do more to transform the strategic relationship than any other project. If cooperation fails in that area, a new round of adversity is likely. Therefore, it is important to get the terms of partnership right. Neither a joint dual-key system nor a NATO-integrated one with Russia as an add-on will do. A more creative approach is needed. Elements of missile defense, such as launch monitoring and threat assessment, should be integrated, while firing systems and should remain a national responsibility for Russia or an alliance responsibility for NATO. In any event, it would not be a great idea for the United States to try to shoot down an Iranian missile above Russian territory.
In respect to hardware, Russia’s cooperation on weapon systems with European NATO countries is an excellent way to develop state-of-the-art weapons and save money during a time when defense budgets are being slashed across the board. This could also help Russia get better weapon systems as it embarks on a major rearmament drive. At the same time, it would instill more confidence in Russia’s neighbors that they have nothing to fear from these weapons.
For this cooperation to be smooth and sustainable, Russia and NATO members need people to directly engage with one another. Creating a Russia-NATO partnership college to learn the habits and practices of cooperation would be one good place to start. In terms of software, as Russia has proceeded with military reform, it needs to learn more about how the world’s leading defense institutions are dealing with the challenges of the 21st century. Sending bright and ambitious young officers to study abroad and then fully using their expertise in remaking the Russian military is one way of accomplishing this. Inviting some of the world’s best military brains to lecture at the Academy of the General Staff is another good idea.
We should not be under any illusion as to where Russia and NATO are today. They have just stepped away from the brink. Only 2 years ago, the two sides were on a collision course. NATO’s 2008 Bucharest summit set loose a train of events — above all, the alliance’s commitment to offer membership acceptance plan status to Georgia and Ukraine — that led to the war between Russia and Georgia. The situation resulting from that war is still unresolved, as are other frozen conflicts.
To be sure, the warm relations and constructive level of cooperation between Russia and NATO relations has a lot to do with Ukrainian President Viktor Yanukovych’s embrace of the country’s “non-bloc” status, and with U.S. President Barack Obama’s move to reset relations with Moscow. For the first time since the mid-1990s, NATO’s further enlargement to the east is not really on the agenda anymore, although not everyone in NATO and Georgia are pleased about this.
For the happy hour in Russia-NATO relations to evolve into a long-term happy relationship, the Euro-Atlantic territory needs to be turned into a single, undivided space. Formal treaties are important but not enough. More openness and cooperation on the ground are needed. Missile defense can be a game changer — or, failing that, a game breaker. For new, bold initiatives and declarations to have any meaning, they need to be backed up by concrete action.
As the Russians are reaching out, the people of Poland and the Baltic states also need to dismantle the psychological defenses that they have built up against the Russians. It is a two-way street. There should be a commitment to solve the frozen conflicts, starting with Transdnestr. In addition, a peace settlement between Russia and Georgia would allow stable peace to finally emerge in all of Europe. This in turn would allow Russia to abolish its Western front and focus on its historical task of making itself an advanced economy and a great nation. Lisbon was a step in the right direction, with many more steps yet to be made.

Dmitry Trenin is director of the Carnegie Moscow Center and counselor of the Commission on the Euro-Atlantic Security Initiative.

TITLE: The START and Khodorkovsky Bellwether
AUTHOR: By Richard Lourie
TEXT: In Yokohama, Japan, at the end of his 10-day Asia swing, U.S. President Barack Obama made a point of reassuring President Dmitry Medvedev that Senate ratification of New START would be his “top priority” during the lame-duck session of Congress. The New York Times noted the “chummy tone” of the Obama-Medvedev public exchanges. There was even some chatter in the press that Senate Republicans might opt to ratify the treaty to demonstrate that they could be reasonable and bipartisan — particularly when the obvious good of the country was involved — which in turn would allow them to be unreasonable and partisan on other issues later on.
But no such luck. The Republicans just couldn’t wait to start being unreasonable and partisan. After first indicating that funds pledged for the modernization of the U.S. nuclear arsenal removed the sole obstacle to ratification, they suddenly found too many other issues and problems with the treaty to deal with it in the crowded lame-duck session that will end sometime before the December holidays. The funds had been allocated, more than 900 questions posed by senators had been answered, and the treaty itself was hardly controversial. It reduces the number of warheads and delivery systems, allows for mutual inspections that lapsed a year ago, and perhaps most importantly, it binds the United States and Russia closer politically in a relationship that has already yielded significant results in Afghanistan and Iran.
Now Obama has rolled out big Republican security guns like former U.S. Secretaries of State Henry Kissinger and James Baker and U.S. Republican Senator Richard Lugar. Obama is making this a showdown, a test of his presidency with his prestige and influence on the line at home and abroad. This puts the Republicans in a tough spot because national security is not like health care, which is subject to blurring and smearing. But all Republican actions are directed toward a single goal — recapturing the White House in 2012 at all costs, even if it damages the country’s security.
Medvedev should not think that the Republicans are motivated by a contemptuous disregard for Russia. They are, in fact, primarily motivated by a wanton disregard for the United States.
The Republicans will probably decide to humiliate Obama during the lame-duck session, but “after careful deliberation” during the break, they will most likely ratify the treaty after the start of the new congress, taking patriotic and legislative credit for themselves. There is also a slight possibility that they will let the treaty wither on the vine, but that would seem too shamelessly negligent even for this latest bunch.
A similar suspenseful and significant drama is being played out in Russia. A verdict will supposedly be reached in the second criminal case against former Yukos CEO Mikhail Khodorkovsky on Dec. 15. It will be a hopeful sign if Moscow finds a reasonable compromise — enough jail time, say two or three more years, to satisfy the hard-liners and keep Khodorkovsky out of circulation until after Russia’s 2012 presidential election, but not so much that spite will have triumphed over self-interest.    
The resolution of the Khodorkovsky case and New START ratification are also indications of which forces in the society have the upper hand and which direction those dominant forces are heading. If ratification falls through and Khodorkovsky’s sentence is longer than three years, the worst tendencies in both societies will have triumphed. This is a lose-lose situation any way you look at it.

Richard Lourie is the author of “The Autobiography of Joseph Stalin” and “Sakharov: A Biography.”

TITLE: Film Festival Opens in Neighboring Cultural Capital
AUTHOR: By Sergey Chernov
PUBLISHER: Staff Writer
TEXT: St. Petersburg’s closest Baltic neighbor is gearing up for the nearest major European film festival to St. Petersburg. 
Pimedate Oode Filmifestival (translated as the Black Nights Film Festival from Estonian, and known as POFF), is held in Tallinn, less than an hour away by plane or about seven hours by bus. 
Intentionally or otherwise, the festival counterpoints St. Petersburg’s White Nights festival, a music, ballet and theater festival that takes place in the city every summer.
“The Black Nights Film Festival always takes place in the last week of November and the first week of December, which according all the Scandinavian and northern legends, is the time when lone spirits wander the earth,” says Black Nights director Tiina Lokk.
“When founding the festival 14 years ago, we thought that films are precisely such lone spirits that walk around the country looking for their audience, and now I have to say that they have found one.”
Founded in 1997 primarily as a showcase for Nordic film, the festival — whose logo depicts a lone wolf — has evolved to feature films from all around the world, and attracts up to 57,000 visitors every year — an impressive number for the Estonian capital, whose population is 410,050. According to Lokk, 530 films are shown during the festival, including 230 feature films.
“I dare to say that it’s bigger than the Moscow Film Festival,” Lokk said when presenting the event in St. Petersburg late last month.
The year 2010 is a special one for the festival, which marks the opening of Tallinn’s tenure as Europe’s Cultural Capital. The festival will hold the 23rd European Film Awards Ceremony, which will wrap up the festival on Dec. 4.
The European Film Awards are run by the European Film Academy (EFA), which was created as the European Cinema Society in 1989 on the initiative of Ingmar Bergman, who became its first president, and 40 other filmmakers to advance the interests of the European film industry. Wim Wenders was elected as first chairman of the association, which two years later was renamed the European Film Academy.
On Dec. 4, the winners of the European Film Awards will be announced at POFF. The nominees for the Best European Film award include “Honey” (Bal) by Turkey’s Semih Kaplanoglu, “Of Gods and Men” (Des hommes et des dieux) by French director Xavier Beauvois, Roman Polanski’s “The Ghost Writer,” Israeli director Samuel Maoz’s “Lebanon,” Argentinean director Juan Jos? Campanella’s “The Secret in their Eyes” (El secreto de sus ojos) and Turkish-German director Fatih Akin’s “Soul Kitchen.”
Polanski, Maoz and Kaplanoglu are also competing as the Best European Director award, alongside Olivier Assayas for “Carlos” and Paolo Virzi for “The First Beautiful Thing” (La prima cosa bella).
“We hope that the whole European world of film will come to visit us,” Lokk says.
It was a tough job to launch a film festival in the 1990s when the small Baltic country finally gained independence from the Soviet Union, forcing it to reconsider its newly independent economics.
Lokk admits that Estonia was not known for major film events during the country’s Soviet period, which lasted from 1940 to 1991 (with a brief interruption for occupation by Nazi Germany between 1941 and 1944), when only two film festivals of any note were held, one of which was a sports film festival.
There were about 600 film theaters in Estonia in the Soviet era, but at some point in the mid-1990s, they remained only in Tallinn, Tartu, Parnu and Haapsalu, Estonia’s four largest towns.
“The big question was, what happens next? There were debates about what would happen with the Estonian film industry, whether it would produce films or not, whether there were any funds to do so,” says Lokk.
“Because the [Tallinnfilm] studios were closed, there was very little money. The big question of existence was looming. It was only later that I found out that all the major festivals were also born out of protest.”
The first Black Nights Film Festival featured only 29 films, mostly from the Nordic countries and Germany, and drew around 5,000 visitors, according to Lokk.
One of the reasons the unlikely, cold period in late November to early December was chosen for the festival was a gap on the international film festival calendar at this time. It was also chosen as a time when few things could distract filmgoers from attending screenings.
“It was the best period for Estonian film fans, because we had dark nights, no sun, and the only possibility is to go to the movies or make babies,” Lokk says.
“That’s why the attendance of cultural events is the best at that time.”
The Black Nights is in fact an umbrella festival that also features several sub-festivals, such as MOFF, the Nokia Mobile Film Festival — a contest for films shot on cell phones. “Our idea and mission is to show that filmmaking is very simple: Take your cell phone and make a movie,” says Lokk.
The other sub-festivals include “Sleepwalkers,” a festival of short films made by students, “Animated Dreams,” an animated film festival, “Just Film,” a children’s and youth film festival, and The Baltic Event devoted to the newest feature films from Estonia, Latvia and Lithuania.
Since last year, the festival has also featured the North American Independent Film Competition. 
The Black Market Industry is a part of the festival under which film industry professionals are presented with the latest works from North-Eastern Europe and its neighboring regions, including Russia.
Of current Estonian films of note, Lokk cites Peeter Simm’s “Georg,” a biopic about Estonian Soviet singer Georg Ots; Veiko Ounpuu’s “Autumn Ball“ (Sugisball), a dark comedy about six inhabitants of Soviet-era tower blocks in Tallinn, which was adapted from Mati Unt's 1979 novel of the same name; and Ounpuu’s newer film “The Temptation of St. Tony” (Puha Tonu kiusamine). This year will see “Letters to Ingela,” a new film by Sulev Keedus, who filmed “Georgica” (1998), a slow-paced film about an old man, a young boy and a horse who live on an Estonian desert island used by the Soviet Air Force for training bombers.
“Keedus makes few films, but every time he makes one, it becomes famous; he’s the most art-house and perhaps most philosophical film director,” says Lokk.
One of the best-known Estonian films is “The Class” (Klass), a 2007 teen drama dealing with the issue of violence in schools.
According to Lokk, perhaps the strongest section of the Estonian film industry is animation, with one puppet film studio and two animated film studios currently operating in Estonia.
“At film school I gave a course of lectures on the subject ‘How to Liberate National Filmmakers from the National Inferiority Complex,’” she says.
“But I have exactly the same problem; I like 50 percent of films, and with the other 50 percent I start to say, ‘Well, maybe it’s not that good.’ When they make good films, then they’re good, but they are a lot of weak ones now, too. But it’s the same everywhere.’
Lokk says she regards the two generations of younger Estonian filmmakers with optimism. “I believe Estonian film will be very strong in the future,” she says.

<em>Pimedate Oode Filmifestival runs through Dec. 4. From St. Petersburg, Eurolines (www.luxexpress.eu) and Ecolines (www.ecolines.net) operate bus services to Tallinn, and Estonian Air (www.estonian-air.ee) flies to Tallinn.</em>

TITLE: In the Spotlight: Putin’s Puppy, Sex Kittens
AUTHOR: By Anna Malpas
TEXT: Last week, in the ultimate fluffy news story, Prime Minister Vladimir Putin hugged a puppy and invited us to think of a name. The male puppy was a gift from the Bulgarian prime minister as Putin visited for talks on a gas pipeline. The puppy was carried in by a vast entourage and seemed to take to his new master, giving Putin a lick on the cheek.
Some pointed out that the sad-eyed puppy with adorable white socks will later morph into an enormous shaggy guard dog. Putin’s Labrador Connie, graying now, may not know what has hit her. She was shown lying on the sofa as Putin and his wife Lyudmila were filmed taking part in the census in a horribly awkward stunt. Putin joked that Connie was his “first wife” and certainly showed her more affection, giving her a rub as she laid on her back with her paws in the air. But then Labradors like everyone.
Rights activists complained that to leave a name suggestion on Putin’s web site you had to fill in your entire contact details, presumably to crack down on the saboteurs who tried to submit puns in paw taste or brought up poisoned umbrellas. So far bloggers have been taking it all a bit too seriously, suggesting that the poor puppy should be called “kickback” or “power vertical.”
Russian property developers also have an interesting line in names. Model Naomi Campbell is promoting the Legend of Tsvetnoi, a luxury housing complex on Tsvetnoi Bulvar in Moscow built by her boyfriend, developer Vladislav Doronin. In the television ad, Campbell purrs, “Now you know where I stay,” in English.
Interestingly the new “deluxe” building that she is promoting stands on a site that is legendary for very different reasons. It was the former headquarters of the Moscow branch of the Communist Party of the Soviet Union.
Campbell is shown in the pool, using the gym and even walking around the “premium” conference facilities in a suit and very high heels. Rather oddly, the ad switches languages mid-sentence, since apparently Campbell’s Russian was not up to the task. So you hear a woman whispering in Russian, “Through the windows of my house,” and then Campbell’s voice saying the cheesy line, “I listen to your heart, Moscow,” as you see her gazing out wistfully. It’s not exactly Paris fashion week, so I hope she got a fat fee.
If Campbell flogging Moscow real estate wasn’t bizarre enough, former spy Anna Chapman turned up last week for the opening of a Swiss watch store. She rolled up in a white horse-drawn carriage, dressed in all white, including her stiletto boots and zipped dress. Russian media quoted the director of the Ulysse Nardin brand, Rolf Schnyder, as saying it was his idea to invite her.
Chapman was photographed wearing one of the watches. She chose a steel watch decorated with diamonds because she doesn’t like gold, Schnyder was quoted as saying. The brand’s web site said it made a donation to a children’s charity on her request.
Ulysse Nardin makes over-the-top watches including one decorated with a miniature St. Basil’s Cathedral. Vedomosti reported that Deputy Prime Minister Dmitry Kozak is a fan, as is Anatoly Chubais, head of Rusnano.
Chapman has kept up an enigmatic silence even while taking off her clothes for Maxim magazine, despite journalists’ best efforts.
Tvoi Den chased Chapman at a cafe with a “well-fed” male companion last week. It also caught her at a film premiere and hinted that Chapman told the journalist where to go. “Despite her luxuriant figure, she can’t boast a decent vocabulary,” it sniffed.

TITLE: Failure to Make the Grade Irritates Universities
AUTHOR: By Alexandra Odynova
PUBLISHER: The St. Petersburg Times
TEXT: MOSCOW — Russian universities are seething after failing to win international recognition in a year when the country has been galvanized by Kremlin calls for modernization. So angry are they that some are calling for the creation of Russia’s own university ranking system.
Some might say the problem boils down to a “Squirrel Institute” mentality — an arrogance by scholars that causes them to refuse to learn English or publish their research in English. As a result, their work often escapes the attention of the international academic community, and Russian universities suffer.
Not a single Russian university made it to the top 200 list of the world’s best schools released this fall by the Times Higher Education World University Rankings, the most authoritative global annual rating of higher education institutions.
The top-ranked school is Harvard University, while many other U.S. and British universities prevail on the list.
“Russia has a proud history of scientific innovation and has some excellent universities,” Phil Baty, an editor of the ranking, said by e-mail. “But the university system as a whole has suffered in recent years — losing leading research talent to other countries, and suffering from lower investment than other nations.”
Last year, Moscow State University placed 155th, while St. Petersburg State University came in at 168th.
Dismayed with Moscow State University’s lackluster ranking, its rector, Viktor Sadovnichy, said Russia needed to create its own ranking because international ratings are not objective concerning Russian schools.
The idea was explicitly backed by Prime Minister Vladimir Putin at a meeting with Russian rectors last month.
Moscow State University has worked hard to cooperate with international employers and academic communities to improve its ranking — and it has worked, but not as much as it hoped, said Alexei Chaplygin, an analyst with the Moscow-based ReitOR rating agency.
“To establish relations with a ranking agency is a common practice for universities in civilized countries,” Chaplygin said.
He said Moscow State University and a number other leading schools tried to get into the Times Higher Education World University Rankings but failed because of the “bad quality” of provided data.
Baty said his organization was working with Moscow State University “to re-examine its data after it failed to make the top 200 this year.”
“Russia’s research publication output is relatively low,” Baty said.
The ranking is based on 13 elements, including research income, ration of international and domestic staff, income from industry, teaching, and citation impact. The ranking’s editors used data provided by Thomson Reuters to make their conclusions for the first time this year.
Russia’s limited volume of research publications indexed by Thomson Reuters, as well as those publications’ limited influence as measured by citations, is reflected in the rankings, which employ both publication volume and citation counts among the 13 separate performance indicators. Additionally, the judging system was changed this year so that traditional prestige no longer holds much weight in the final reckoning.
“All these factors will make it difficult for Russia to be recognized among the top 200,” Baty said.
One of the measurements that Russian scholars frequently fail to fit is the citation index because many of their articles are written in Russian and remain unknown for the majority of the global scientific community. But even the country’s top scholars don’t encourage English.
When asked about Russia’s low citation index, Russian Academy of Sciences president Yury Osipov said in an interview with Gazeta.ru that Russian scholars don’t have to learn English because if “one is a high-level specialist, he will study Russian and read articles in Russian.”
The Russian Academy of Sciences echoed the statement of its president on its web site — and published an English version of its web site that has been mocked by bloggers for stunning translation errors. In one mistake, the renowned Institute for Protein Research was mistakenly named “Squirrel Institute” because the Russian word for protein, “belok,” was incorrectly translated as “belka,” a squirrel.
Times Higher Education World University Rankings used to obtain data from QS, a leading global career and education network, but Times Higher Education broke the contract after the joint 2009 ranking prompted criticism from schools in several countries, including Russia.
QS releases its own university rating every year, and this year’s list included one Russian school — Moscow State University — at 93rd place, an improvement from last year, when it ranked 101st.
The QS rating is based on measures of research quality, graduate employability, teaching and the number of foreign students and teachers, its web site says.
Another top world rating, the Shanghai-based 2010 Academic Ranking of World Universities, released in August, ranked Moscow State University at 74th, the only Russian school that entered the top 100. That ranking is mainly based on the number of published scientific articles and per capita performance, its web site says.
Sergei Guriev, rector of the New Economic School in Moscow and a Morgan Stanley professor of economics, said Russian universities “have been losing ground not only to their OECD counterparts but also to the universities from developing countries.” For example, China has six universities in the 200 institutions ranked by the Times Higher Education World University Rankings.
“Modernization and a knowledge-based economy by definition require advanced human capital. There can be no modernization of the economy — and of society — without the modernization of higher education,” Guriev told The St. Petersburg Times.
A request for comment on the rankings sent to Moscow State University on Friday was not immediately answered.
Moscow State University has proved that it is possible to get into an international ranking by cooperating with researchers, but some Russian universities that win praise inside the country just do not aspire to get into the international ratings.
“We consider those ratings incorrect,” said Andrei Volokhov, a spokesman for the prestigious Bauman State Technical University.
“For us, the evaluation by employers is more important. And both Russian and foreign employers hold our graduates in high esteem,” Volokhov said by telephone.
He said the university focuses more on domestic ratings, where it is ranked as one of the best in the country.
Peoples’ Friendship University, which is also considered prestigious in Russia and is popular among foreign students, has not entered the competition for any international rankings. Spokeswoman Galina Kuzmina said the university would like to win “an important ranking” but does not make any extra efforts to prove its high standards.
“We have a web site where all the data are open to everyone,” she said. “So researchers [from Times Higher Education World University Rankings] can get anything they need there.”

TITLE: Officials Fear Worst at New Zealand Mine
AUTHOR: By Joe Morgan and Ray Lilley
PUBLISHER: The Associated Press
TEXT: GREYMOUTH, New Zealand — Hopes waned Monday for the survival of 29 New Zealand coal miners who have been trapped for three days underground, where the presence of explosive gases has prevented a rescue.
Family members expressed frustration with the pace of the response as officials acknowledged for the first time it may be too late to save the miners, who have not been heard from since a massive explosion ripped through the Pike River Mine on the country’s South Island on Friday.
A buildup of methane gas is the suspected cause of the explosion, though officials say that may not be confirmed for days. And now the presence of that gas and others — some of them believed to be coming from a smoldering fire deep underground — are delaying a rescue over fears they could still explode.
“Everybody’s frustrated, everybody’s upset,” said Laurie Drew, whose 21-year-old son, Zen, is among the missing. “I have my moments when I can keep it together but deep down my heart’s bleeding like everybody else’s.”
Authorities are working on drilling a 500-foot-long, six-inch-wide (160-meter-long, 15-centimeter-wide) shaft into the mine tunnel to get a better idea of the air quality in areas where miners were believed to be trapped by the blast.
Officials will also feed a very high-resolution laser camera down the hole to give rescuers their first sight of conditions — and potentially the men inside, said John Dow, the chairman of Pike River Coal Ltd., the mine owner.
Once the question of air quality is resolved, rescuers hope to send a bomb-disposal robot into the mine. Army specialists were at the mine site Monday fitting the robot with a camera and up to 1.5 miles (2.5 kilometers) of fiber optic cable so it could take video of conditions in the tunnel.
The battery-operated robot can only operate in fresh air, and so cannot be sent into the mine until the air clears. Also, checks were under way to make sure the robot would not cause a spark or anything else that could ignite flammable gases inside.
“We still remain optimistic, we’re still keeping an open mind,” police superintendent Gary Knowles told reporters. “But we are planning for all outcomes, and as part of this process we’re planning for the possible loss of life as a result of what’s occurred underground.”
Two workers stumbled out of the mine within hours of Friday’s explosion, but there has been no contact at all with the missing 29. A phone line deep inside the mine has rung unanswered for days.
One of the two workers who escaped, Daniel Rockhouse, 24, described the explosion as being like an oversized shotgun blast.
He said the explosion smashed him into the mine wall and knocked him out. When he came to, he staggered to a nearby compressed air line to breathe in fresh air and gain some strength.
“I got up and there was thick white smoke everywhere — worse than a fire. I knew straight away that it was carbon monoxide,” Rockhouse, whose brother Ben remains underground, was quoted as saying by the New Zealand Herald newspaper. “I couldn’t see anything, and it was dead quiet. I yelled, ‘Help, somebody help me!’ But no one came. There was no one there.”
Rockhouse stumbled toward the exit and eventually found the unconscious body of Russell Smith, the other survivor. Rockhouse began dragging Smith, until the other awoke. The two men stumbled through the dark haze to finally reach the surface nearly two hours after the explosion.
“It wasn’t just a bang, finish, it just kept coming, kept coming, kept coming, so I crouched down as low as I could in the seat and tried to get behind this metal door, to stop getting pelted with all this debris,” Smith told TV3. “I remember struggling for breath. I thought at the time it was gas, but ... it was dust, stone dust, I just couldn’t breathe. And that’s the last I remember,” he said.
Police have said the miners, aged 17 to 62, are believed to be about 1.2 miles (two kilometers) down the tunnel.
Each miner carried 30 minutes of oxygen, and more fresh air was stored in the mine, along with food and water, that could allow several days of survival, officials say.
New Zealand mines are relatively safe. A total of 181 people have been killed in its mines in 114 years.

TITLE: Bailout Boost To Markets Shortlived
AUTHOR: By Pan Pylas
PUBLISHER: The Associated Press
TEXT: LONDON — Stocks and the euro currency got an early boost Monday from Ireland’s application for a massive emergency loan, but fears of further financial problems in Europe reined in the optimism.
In Europe, the FTSE 100 index of leading British shares was down 9.81 points, or 0.2 percent, at 5,723.02 while France’s CAC-40 fell 4.08 points, or 0.1 percent, to 3,856.08. Germany’s DAX remained in positive territory, trading 140.18 points, or 0.2 percent, higher at 6,857.73.
Wall Street was poised for modest gains open later — Dow futures were up 5 points at 11,184, while the broader Standard & Poor’s 500 futures rose less than a point to 1,198.80.
Stock markets had been in far better shape earlier — Asian markets closed mostly higher — as investors breathed a sigh of relief that some sort of aid package for Ireland is being cobbled together. The Irish government confirmed Sunday that it is formally requesting a financial aid package to shore up its debt-laden banking sector.
The actual details of the package, expected to be not far short of 100 billion euros ($137 billion), are not expected for a few days yet as Irish officials sit down with counterparts from both the European Union and the International Monetary Fund. The country will likely be forced to make further massive spending cuts and raise its very low rate of corporate tax.
Aside from whether another Irish austerity program will work, the major worry in the markets is whether another highly indebted euro country — Portugal — starts getting the unwelcome attention of bond investors.
“News that the Irish government were going to accept assistance with a debt bailout package certainly gave traders something to cheer about at the start of the week, but there seems to be a creeping realization that this won’t necessarily mark the end of the eurozone sovereign debt crisis,” said Will Hedden, a sales trader at IG Index.
The unease was evident in the currency markets, where the euro gave up the advance it made in the wake of Ireland’s request — by early afternoon London time, the euro was down 0.2 percent at $1.3692. Earlier it had traded as high as $1.3786.
Developments surrounding Ireland should dominate activity in the markets this week, not least because the U.S. will effectively shut down from Wednesday onwards as traders head off for the Thanksgiving break.

TITLE: N. Korea Threat Assessed
AUTHOR: By Kelly Olsen
PUBLISHER: The Associated Press
TEXT: SEOUL, South Korea — The U.S. special envoy for North Korea said Monday that Pyongyang’s claim of a new uranium enrichment facility is provocative and disappointing, but not a crisis or a surprise. Washington, he vowed, will keep working closely with its regional partners in response.
Stephen Bosworth’s comments, following a meeting with South Korean Foreign Minister Kim Sung-hwan, came as the United States and the North’s neighbors scrambled to deal with Pyongyang’s revelation to a visiting American nuclear scientist of a highly sophisticated, modern enrichment operation that has what the North says are 2,000 recently completed centrifuges.
“This is obviously a disappointing announcement. It is also another in a series of provocative moves” by North Korea, Bosworth said. “That being said, this is not a crisis. We are not surprised by this. We have been watching and analyzing the [North’s] aspirations to produce enriched uranium for some time.”
Kim also played down the facility, telling reporters: “It’s nothing new.”
Top U.S. military officials, however, warned that it could speed up the North’s ability to make and deliver viable nuclear weapons. South Korea’s defense minister told lawmakers Monday that Seoul will discuss the possibility of having the U.S. bring tactical nuclear weapons back into the country.
U.S. Defense Secretary Robert Gates said the facility could enable North Korea to build “a number” of nuclear devices beyond the handful it is presumed to have already assembled. Gates was speaking in Bolivia, where he is attending a regional defense conference.
The American scientist, Siegfried Hecker, posted a report over the weekend saying that during a recent trip to the North’s main Yongbyon atomic complex, he was taken to a small, industrial-scale uranium enrichment facility.
Hecker, a former director of the U.S. Los Alamos Nuclear Laboratory who is regularly given glimpses of the North’s secretive nuclear program, said the North Korean program had been built in secret and with remarkable speed.
It wasn’t immediately clear why the North chose to reveal the previously hidden facility. It could be a ploy to win concessions in nuclear talks or an attempt to bolster leader Kim Jong Il’s apparent heir.

TITLE: Saudi King Heads to U.S. for Medical Treatment, Crown Prince Left In Charge
AUTHOR: By Abdullah Al-Shihri
PUBLISHER: The Associated Press
TEXT: RIYADH, Saudi Arabia — Saudi Arabia’s 86-year-old King Abdullah handed over duties to his crown prince on Monday and left to the United States for treatment of a blood clot and slipped disc, the palace said.
Saudi authorities have been unusually open in going public with the king’s condition, apparently in an effort to prevent any speculation and reassure allies of the key Mideast nation and oil power. Personal issues within the royal family are often kept under strict wraps.
Photos showed the king at the airport, kissing his deputy prime minister Prince Nayef bin Abdulaziz as he departed. Abdullah was seated in a plush chair on the tarmac, an IV catheter inserted in the back of his hand. Pictures in newspapers over recent days have shown the king being pushed in a wheelchair — though still looking hardy.
Late Sunday, Health Minister Abdullah al-Rabeeah went on state TV saying Abdullah had suffered a slipped disc and that a blood clot was pressing nerves in his back, causing him pain.
“But I assure everyone that the king is in stable condition and enjoys good health and God willing will return in good health to lead this great nation,” al-Rabeeah said. 
Abdullah on Monday issued a royal decree mandating Crown Prince Sultan, his half brother and heir to the throne, to “administer the nation’s affairs” in his absence.
The 85-year-old Sultan has his own health issues: He underwent surgery in New York in February 2009 and has spent much of the time since at a palace he owns in Agadir, Morocco, recuperating. Sultan arrived Sunday to step in when the king left for treatment.
The palace announced Abdullah’s departure on Monday “for medical tests.” It did not specify where the king would be treated.
Abdullah rose to the throne of this key U.S. ally and oil power in 2005 after the death of King Fahd, another of his half brothers, though he had already been a de-facto ruler for half a decade.
The top of the line for the throne in Saudi Arabia is populated by royals of advanced age, raising questions about where the succession could go in the longer term. After Abdullah and Sultan, Nayef — in his late 70s — is widely seen as the best positioned to be next in line.
Since its creation in the 1930s, modern Saudi Arabia has been ruled by the sons of its founder, King Abdul-Aziz, who had dozens of children from several wives before his death in 1953.