SOURCE: The St. Petersburg Times
DATE: Issue #623 (0), Friday, November 24, 2000
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TITLE: Wexim Bank Scorns 'Milosevic Money' Report
AUTHOR: By Ana Uzelac
PUBLISHER: Staff Writer
TEXT: MOSCOW - Former Yugoslav President Slobodan Milosevic during his years in power funneled from $3 billion to $4 billion out of his country with the help of the Yugoslav Embassy in Mos cow, a Serbian-language weekly magazine has reported.


Quoting unnamed banking sources, the magazine Reporter alleges Milosevic was sending cash through diplomatic mail to Belgrade's embassy in Moscow.

The Reporter wrote that in Moscow the money was handled personally by former Yugoslav Ambassador Danilo Mar kovic and later by his successor Bo ri slav Milosevic, who is Slobodan Milo sevic's brother.

Yugoslavia was under a UN economic embargo at that time and its banks were not allowed to operate abroad.

"Milosevic's money" was transferred from Russia to Tajikistan through a Moscow-based bank, Wexim Bank, and then on to South Africa, Kuwait and Lebanon, the weekly said.

The Russian Foreign Ministry had no comment Thursday. But both the Yugoslav Embassy and Wexim Bank fervently denied the report.

Ambassador Borislav Milosevic called it "utter stupidity."

"I don't know about any money whatsoever, apart from what was designated by the [Yugoslav] budget for the maintenance of the embassy," he told Interfax.

In a written statement, Wexim Bank said the report "had no connection to reality." The bank's lawyer, Nikolai Fomin, said in a telephone interview Thursday that the bank will demand an official apology from Kommersant newspaper, which published its own account partially based on the Reporter article.

TITLE: Journalist Runs Web Project as iOne-Man Show
AUTHOR: By Aliona Bocharova
PUBLISHER: Special to The St. Petersburg Times
TEXT: He is called iOne. He has nothing but an online PC computer and a practically empty Moscow flat, which he is not allowed to leave for three weeks. And he has been challenged to find out what the Russian Internet has to offer and if he can survive using that and that alone.


Starting out with only a sleeping bag, a bar of soap, toilet paper, a towel, his cat Mufta, a computer and three digital cameras, iOne will have to use such sites as www.xxl.ru, www.supermag.ru and www.7continent.ru to buy everything he needs.

He has been supplied with a credit card and a spending limit of $500, donated by Alfa Bank, which is helping sponsor the project.

And thanks to the cameras, you can watch him cope with his wired life at www.ione.ru/webcam/index.pl, chat with him and chart his daily progress according to a published timetable. 

In real life, iOne is Fyodor Pavlov-Andreyevich, 24, a former anchorman of ORT's television program "To 16 and Older," and now chief editor of the youth magazine Molotok.

"He is a unique person who is perfect for this project, thanks to his communication skills," said Molotok photographer Nikolai Gulakov, speaking from Moscow by telephone on Thursday.

"We really miss him at the magazine, but we do contact him by e-mail to solve serious issues."

The experiment "iOne.ru," also known as "iOne@home," was launched on Monday. It is a project backed by the Kommersant Publishing House, which will publish a report on the experiment in the weekly magazine Kommersant Money, and by Andersen Consulting, which held a similar experiment - but for three months - earlier this year in South Africa with journalist Chris Botha.

"The 24-hour Web cams are the only truly extreme part about this project," says Botha - Web name dotcoza - on the Andersen Consulting Web site.

"And, of course, not everyone would [have chosen] to confine themselves to their house for 90 days at a stretch. But that doesn't remove the fact that increasing numbers of people are choosing to perform an ever-increasing number of their daily tasks over the Internet."

"The success [of that project] was tremendous," said Georgy Mistulov, Andersen Consulting general director, in a telephone interview Thursday.

"I think iOne will have the same public response. And our company will receive invaluable data [on the Russian net]."

But Daniel Dougaev, editor of the Web news service internet.ru, said that in Moscow, iOne shouldn't face too many problems.

"It would have been far more interesting to have had this take place not even in St. Petersburg, but somewhere like Novgorod," Dougaev said by telephone on Thursday. "In Moscow, it's clear that everything will work out - the shops are full and the delivery is quick." 

"Or, they should have given [iOne] very little money."

Nevertheless, scanning the chat boards at iOne.ru shows that people have plenty of questions to ask about what may become a standard way of life in the years ahead.

One person was even wondering whether iOne can get a prostitute for a night through the Internet - iOne is allowed vistors, although they are not permitted to bring him anything.

Most others, however, were interested in the consumer side of the project. With no gadgets in the kitchen to begin with, the vegetarian iOne has had to cook his buckwheat in the kettle. Many people are apparently concerned about buying a bed, which at 17,000 rubles ($560) as offered at xxl.ru, is way beyond iOne's means.

But he is allowed to invite businessmen, politicians and even athletes and actors to offer their advice on how to maintain this way of life, and says that he is learning Spanish - with a Mexican virtual teacher at www. language_learning.ru - in order to communicate better with an e-pen friend from Chile.

On the chat room part of his site, iOne confesses to already being tired with the 500-plus e-mails he gets sent every day, but he was upbeat about his situation after day one: "I am not depressed!" he wrote on the site. "Nor am I scared. But tremendously interested, when I realize that this is not an endless dream, but a real story that will be over in three weeks with - I hope - a happy ending."

As Botha commented himself from a chat room, "I felt like I touched the future: All civilized people are going to live the way I did in 10 to 15 years time."

"The only unpleasant thing was that, after the project, I had to get used to buying everything with my own money!"

TITLE: Prosecutor Questions Kudrin, Artemyev
AUTHOR: By Vladimir Kovalyev
PUBLISHER: Staff Writer
TEXT: Prosecutors who summoned the finance minister to St. Petersburg for interrogation Monday also hauled in Yabloko Duma Deputy Igor Artemyev to testify in the same case.


Finance Minister Alexei Kudrin has not commented on the decision by St. Petersburg prosecutors to investigate his days as deputy mayor here. On Wednesday, however, Kudrin canceled a news conference about foreign debt.

Artemyev said that the prosecutors had asked him about the practice of using budget money to buy apartments for city finance officials in St. Petersburg.

Artemyev said funds were sent to St. Petersburg from the Finance Ministry for that official purpose. He said that the idea was to keep qualified finance officials from leaving for the private sector.

The St. Petersburg's prosecutor's office had no comment Wednesday about the case.

Some observers, including Artemyev, have speculated that President Vla dimir Putin is preparing to dump his prime minister and that Kudrin is a candidate for that top job; and that Kudrin's ill-wishers are trying to tarnish his candidacy with a politically motivated investigation.

"I have a feeling that there is a serious fight taking place in the Kremlin between two groups of those who want to take the prime minister's seat," Artemyev said in a telephone conversation.

"The first is the so-called St. Petersburg group [best represented by privatization tsar Anatoly Chubais and his longtime ally Kudrin], and the second is represented by [career intelligence officer] Sergei Ivanov, head of the [Kremlin] Security Council."

There have been signs of an impending government shake-up on the horizon, including a couple of threats by Putin over the past two weeks to sack the government.

On Wednesday, there was talk that another former KGB ally of Putin's might be coming to Moscow: Viktor Cherkesov.

Cherkesov is now the governor general of the federal district that includes St. Petersburg. Vedomosti newspaper, in an unsourced report Wednesday, suggested he might be called up to Moscow for a promotion. Cherkesov's office on Wednesday called such talk "rubbish."

But if Ivanov were to become prime minister - or a new defense minister, a job Kommersant newspaper suggested this week he was being groomed for - the Security Council post would come open, and might well suit Cherkesov .

Kudrin ran St. Petersburg's finances under Mayor Anatoly Sobchak. When Sobchak was voted out in 1996 - in an election that also saw the post of "mayor" renamed "governor" - Governor Vladimir Yakovlev appointed Artemyev to replace Kudrin.

Artemyev said St. Petersburg prosecutors had asked him about the finance committee's practice of granting interest-free loans to its employees to buy apartments.

He said it was not clear to him whether they were interested in the Kudrin-era finance committee, when the practice began, or the Artemyev era.

A 1999 investigation by the Audit Chamber suggested the finance committee had allocated those loans from money meant to service the city's debts.

But Artemyev said that the money was federal funding earmarked to help local officials buy apartments.

When St. Petersburg prosecutors looked into the Audit Chamber's findings in October 1999, they did not open a case, said German Shalyapin, head of the St. Petersburg Audit Chamber.

Shalyapin said prosecutors instead wrote to the governor's office suggesting it run an internal investigation.

By then, the Yakovlev administration had fallen out with both Artemyev and Kudrin and was gunning for both men. Yet there was no indication the governor's office ever shared the Audit Chamber's concerns. A spokesman for the governor's office had no comment Wednesday.

The Audit Chamber report says that in 1998, the finance committee allocated 835,500 rubles (about $140,000 at the then-exchange rate) to buy apartments for six officials, including Sergei Dyomin, Artemyev 's deputy, who got 200,000 rubles (about $33,000) in a five-year interest-free loan.

TITLE: Another Bank in City Is Raided
AUTHOR: By Vladimir Kovalyev
PUBLISHER: Staff Writer
TEXT: Authorities carried out the second violent raid on a major local bank within a week, invading Baltiisky Bank with OMON troops and intimidating employees before seizing documents. 


It was an echo of the Promstroibank, or PSB, raid that local prosecutors carried out on Nov. 16. But the Baltiisky Bank raid had one twist - it was carried out by prosecutors from the city of Belgorod, 900 kilometers to St. Petersburg's south. 

PSB, meanwhile, broke its silence somewhat about the cause of the headline-making raid it experienced a week ago, divulging the fact that one of the members of the City Hall Maintenance Committee, who had taken out a loan from PSB had apparently been the target of the gun-toting law enforcement sweep. 

According to NTV television, St. Petersburg can expect more raids. On Thursday, the station reported that "another major [St. Petersburg] bank will be searched." 

Gennady Ryabov, spokesman for the St. Petersburg Prosecutor's Office, confirmed the Baltiisky Bank search was made by his office's counterparts from Belgorod, but he would not say what sort of case the investigators from the distant city are investigating. 

"It is not the business of St. Petersburg Prosecutor's Office," he said in a telephone interview on Thursday.

He also said the case is in no way linked to Thursday's search of PSB. 

Oleg Shigayev, chairman of Baltiisky Bank's board of directors, said the search was initiated against three export companies that are registered in Belgorod and who maintained accounts at the bank. He would not name the companies when asked to do so at a press conference on Thursday. The companies, however, were behind in their taxes, Shigayev said. Beyond that, Shigayev could not specify what the Belgorod prosecutor's office was looking for. 

"[The companies] are ordinary clients of the bank," Shigayev said at the press conference. 

Baltiisky Bank has assets of 3.4 billion rubles (nearly $124 million) and equity of 263 million rubles ($9.4 million). 

Bank representatives reported that the search was made violently.

"They asked employees to move away from their tables and banned the use of mobile phones," said a bank representative who did not want to be identified. 

"Then all of them were asked to go to a different room, where they spent more then three hours. Many of them had to stand the entire time." 

Shigayev said that the raid's use of OMON troops - Russia's notoriously violent special forces police - in the raid was inconsistent with "a commonplace and routine case." 

He said his bank intended to protest the use of force, but that the complaint would have to be filed in Belgorod where the initiating prosecutor's office is located. 

Representatives of PSB agreed with Shigayev, saying that the violent nature of the raid on their own bank - which included an estimated 15 to 20 OMON troops - was completely unnecessary. 

"We are a bank that obeys the law, so we would surrender any documents, the [Prosecutor's Office] needs with no problem," said Alexei Khitrov, the spokesman for PSB in a telephone interview Thursday. 

PSB's assets are 15.9 billion rubles ($568 million) with an equity of 1.3 billion rubles ($46 million).

"There is no reason to initiate actions like those that happened Nov. 16," Khitrov said. 

On that day, PSB's central office was surrounded by dozens of armed police while 15 to 20 investigators searched the building for documents.

Khitrov said on Thursday that investigators were looking for information on Vyacheslav Strugov, deputy head of the City Hall Maintenance Committee, a client of the bank. 

The case, initiated by the Prosecutor's Office Oct. 5, concerns a $100,000 private loan taken by Strugov in May 1999, Khitrov said. On Nov. 14 the Prosecutor's Office initiated the second case about PSB management, which, the case says, bribed the Committee, Ryabov said. 

"Last year Strugov took the loan and then opened about 10 bank accounts for different departments of the [Maintenance] Committee in PSB. The loans, meanwhile, haven't been paid back," said Ryabov of the Prosecutor's Office in a telephone interview on Thursday.

City Hall strongly denied any wrongdoing. 

"How many criminal cases have they initiated?!" asked Alexander Afanasiyev, spokesman for Gov. Vla di mir Yakovlev, in a telephone interview Thursday. 

"Do you remember any of those that went to court? I would have to have no self-respect to discuss this kind of matter. Let them investigate." 

Strugov himself could not be reached for comment. 

Khitrov added that the loan in question had been paid back within the past few days since the search. He also contradicted the prosecutor's assertion that the maintenance committee had opened some 10 bank accounts. 

"There was only one bank account the committee opened in April of 2000 and there was no money in this account at all. It was empty all the time," he said.

Lawyers say it would be impossible for the Prosecutor's Office to prove any malfeasance at PSB. 

"It is only possible [for the unknowledgeable] to say that an entire bank bribed someone, because legally registered companies cannot be subject to criminal law," said Yury Novolodsky, head of the Baltic Lawyers' Board in a telephone interview on Thursday.

TITLE: London Awaiting Hermitage Exhibit
AUTHOR: By Mike Collett-White
PUBLISHER: Reuters
TEXT: LONDON - She was more successful than her husband. She enjoyed a string of lovers. And she loved to shop. Catherine the Great, Russia's greatest empress, has a decidedly modern appeal more than 200 years after her death.


Perhaps that's why interest is so strong in a new exhibition of some of Catherine's most prized treasures opening in London this week.

"She was an extraordinary personality," said Mikhail Piotrovsky, director of the Hermitage Museum in St. Petersburg, which has lent the 500 or so works to Somerset House. "She was arguably the first great feminist - she had lovers, which was something kings could do, but not queens," he said.

Five rooms of the grand Georgian courtyard close to the river Thames have been transformed into miniature versions of some of the Hermitage's great galleries: down to replicas of the wooden floors laid by Armenian craftsmen.

They contain a tiny proportion of Catherine's vast collection. Some prize pieces, most notably the fine Poussin "Moses Striking the Rock" and a silver-threaded wig worn by the Empress of All the Russias are on proud display.

There is a twist of irony in the appearance of the Poussin. It came from the Walpole collection, which Catherine bought from Britain in 1779 and in so doing enraged the public, which wanted to see it form the nucleus of a British national gallery.

On display in London are pieces from the 744-piece Sevres porcelain "Cameo Service," made for Grigory Potemkin, Catherine's great love.

There are diamond-studded snuff boxes and pendants, a fine James Cox table clock and a collection from the old royal armory in Tula, south of Moscow.

The cost of transforming the rooms and installing the inaugural exhibition was around Pound2 million ($2.8 million). Lord Rothschild, who conceived the idea with Piotrovsky 18 months ago, said all of the money would come from private funding and ticket sales. Among the major backers was Russian oil producer Yukos.

The Hermitage will receive Pound1 ($1.42) from every ticket sold at the first Somerset House exhibition. It opens Saturday and runs until September 2001.

TITLE: Journalist Pasko Despairs at Latest Ruling
AUTHOR: By Anna Badkhen
PUBLISHER: Staff Writer
TEXT: MOSCOW - The Supreme Court's panel of military judges on Tuesday dismissed a lower court's verdict against military journalist and environmentalist Gri gory Pasko, sending the espionage and treason case against him back for new court hearings.


"I consider this [decision] ... a death sentence," a pale Pasko told journalists in the courtroom after the decision was announced. Referring to the Federal Security Service, or FSB, which initiated the case against him, Pasko said, "Their time has come. The power of darkness ... I don't want to talk about this, guys."

U.S. State Department Spokesman Richard Boucher responded immediately with a statement saying the United States government was worried, Reuters reported. 

"I think [Pasko's case] stands out as one of a number of criminal cases that have been brought against journalists, as well as human rights and environmental activists, who have been critical of the Russian government," Boucher told a State Department news briefing Wednesday. 

He said the case raised concerns about judicial independence and manipulation of the legal system to "harass civil society, to intimidate political oppositions and to limit freedom of the press and freedom of speech."

Pasko, 38, was acquitted of treason and espionage by a military court in Vla divostok in June 1999, but was convicted on a lesser charge of improper military conduct. He was sentenced to three years but was immediately amnestied and released. He had already spent almost half the length of his sentence in pre-trial detention.

Both Pasko and the prosecution protested the verdict to a higher court, Pasko saying that the verdict should be annulled and he should be acquitted, and the prosecution saying that the case should be heard again in court.

On Tuesday, a panel of three military judges of the Supreme Court, chaired by Maj. Gen. Lev Zakharov, satisfied the prosecution's protest, saying that the Vladivostok court decision was "incomplete, biased and ill-founded."

The new hearings are to be conducted in the same Vladivostok military court that heard the case before, but with different judges, the Supreme Court ruled.

"Well, they satisfied the protest, what else," said prosecutor Sergei Agodin about the court decision. He refused to comment further.

Pasko and his supporters grimly predicted the worst, saying the Vladivostok court was not likely to repeat its slap-on-the-wrist conviction during the new hearings.

The Vladivostok military prosecutors and the FSB "can't wait to take revenge on me," Pasko said, adding that he was certain he would be jailed immediately upon his return to the Far East city.

Treason in Russia is punished by a maximum sentence of up to 20 years.

"The court is likely to come up with a strict punishment, because this is a time not of dictatorship of the law as the president [Vladimir Putin] said, but of dictatorship of security services," said Anatoly Pyshkin, Pasko's defense lawyer.

Pyshkin said Pasko's case might not be resolved for another year or two.

Pasko caught the attention of the FSB by reporting allegations that the Russian Pacific Fleet mishandled the nuclear waste it generates. He was arrested on charges of passing classified materials to a Japanese television station in November 1997.

Pasko has argued that his material documented environmental hazards at the fleet facilities, but did not involve classified information.

Pasko said the Supreme Court's decision discourages environmentalists in the Far East to speak up about the hazards posed by the Russian navy, which is known for its poor handling of nuclear waste.

"Had the political situation in the country been different, the [Supreme Court] decision would have been different," said Alexander Nikitin, a navy captain-turned-environmentalist who came to observe the Tuesday hearings. 

"The times are tough."

Nikitin was the first Russian environmentalist to be persecuted by the FSB.

TITLE: Pope Prepares for Climax of Trial
AUTHOR: By Patrick Lannin
PUBLISHER: Reuters
TEXT: MOSCOW - U.S. spy suspect Edmond Pope celebrated Thanksgiving on Thursday with a traditional turkey meal in his cell ahead of a crucial few days preparing for a probable verdict next week, his lawyer said.


Pavel Astakhov said proceedings in the five-week trial of Pope, a former U.S. navy intelligence officer who denies espionage, had been cut short so he could return to the grim Lefortovo prison, where members of the U.S. Embassy were to bring him the Thanksgiving meal.

However, he said the meal might have got cold as the consular staff would have had to wait for Pope to return from the court house, situated in a bleak Moscow suburb.

Pope is accused of trying to obtain secret information on a new Russian torpedo, but the American has said he was only trying to buy information which was already openly available.

Astakhov said Pope's trial was likely to reach a culmination next week and that the alleged spy would soon begin to prepare himself for a crucial period ahead in the process.

Pope, in remission from a rare form of bone cancer, faces up to 20 years in jail if found guilty.

U.S. President Bill Clinton has been among those who have pleaded for Pope to be set free. Russian leader Vladimir Putin has said the case is in the hands of the court and Russian doctors have insisted the 54-year-old is fit to be tried.

Astakhov said Friday would be the last day when the prosecution and defense could file documents and motions with the judge and that final arguments would take place next week.

"In principle, today [Pope] is preparing for his final statement. He asked how this is done in Russia ... what one should say, what one should not say," Astakhov said.

"I think next week there will be a verdict."

TITLE: Maskhadov Says Yeltsin Should Be Mediator
PUBLISHER: Combined Reports
TEXT: MOSCOW - Chechen leader Aslan Maskhadov called in an interview published Tuesday for direct talks with the Kremlin on ending the war, and proposed that such talks be mediated by former president Boris Yeltsin.


"Yeltsin should show the young leader [Vladimir Putin] that if he, Yelt sin - a powerful politician, wise from experience - was lied to by his generals, then they can lie to Putin," Mask hadov told the Moskovskiye Novosti newspaper.

Maskhadov accused military leaders of lying to Putin about their ability to win the war, saying police and ordinary soldiers were suffering higher casualty rates than front-line troops.

"It's difficult for the generals to admit this because they have banked everything on this war - their ratings, authority and future postings," Mask ha dov said.

"If Yeltsin instigated the end of this war, then perhaps he could lay to rest this heavy burden."

Yeltsin launched the first 1994-1996 Che chen war and then, with Putin as his activist prime minister, began a second war in 1999. He has expressed remorse over the loss of life caused by the first Che chen war.

Maskhadov also said that federal troops have only a tenuous grip on the republic and that his guerrillas were ready to fight through the winter.

"[The military] can't even say they're in charge of the checkpoints at which they stand," he told the weekly.

His comments came a day after Pu tin ordered military commanders to complete the operation in Chechnya rapidly.

"People are suffering and the anti-terrorist operation needs to be completed," Putin said.

Putin said too often casualties were the result of a lack of professionalism, adding, "We do not need victory at any price," the Krasnaya Zvezda military news paper reported.

Sergei Yastrzhembsky, the Kremlin's chief spokesman on Chechnya, dismissed Maskhadov's comments as nothing new, according to an Interfax report.

TITLE: Search for National Anthem Is Down to 2
AUTHOR: By Daniel Mclaughlin
PUBLISHER: Reuters
TEXT: MOSCOW - Russia's new State Council set Josef Stalin's choice as anthem of the Soviet Union against capitalist Russia's current theme on Wednesday in the next round of the country's decade-long battle for a popular anthem.


The Soviet anthem and 19th-century composer Mikhail Glinka's tune saw off six rival offerings, including one from an aging pop diva, at the inaugural session of an advisory body to President Vla dimir Putin comprising Russia's regional bosses.

Pop singer Alla Pugacheva's effort fell by the wayside when faced by the two big hitters in a race to find an anthem that has split Russia down musical and political lines.

"We listened to eight variations of the anthem and decided to propose two - the current, existing anthem and the anthem of the Soviet Union," said Vla di mir Yakovlev, governor of St. Petersburg.

"It should have new words, naturally. There should definitely be new words written for the music," he added hastily about the Soviet anthem, which was written by Alexander Alexandrov.

Yakovlev said the deputies of the State Duma, the lower house of Parliament, would choose the winning tune but put no time limit on a final decision.

Former President Boris Yeltsin forced a little-known tune by 19th-century composer Mikhail Glinka on Russia in the early 1990s after the Soviet Union collapsed.

But the music has failed to stir national passions, and political in-fighting between Yeltsin and a recalcitrant parliament dominated by leftists left Russia without any words for its "first song."

Reigning soccer champions Spartak Moscow complained to Putin over the summer that the current anthem was impossible to sing, and had led to a loss of morale and dip in form.

The embarrassment reached new heights during the Sydney Olym pics when Rus sian gold medalists complained they had to stand in silence during medal ceremonies.

The search for a rousing, popular anthem has now become an affair of state and Putin was given a CD with eight songs and a variety of texts vying for the honor.

Yakovlev said Putin had not revealed his personal favorite. If put to a nationwide vote, Pugacheva, a hugely popular 50-something singer, and her long-time lyric writer Ilya Reznik might triumph.

Leftists and pro-Kremlin deputies in the State Duma lower house of Parliament back a return to Alexandrov's stirring Soviet tune, adopted as anthem in 1944 under dictator Josef Stalin.

But liberals say Stalin's bloody purges make the music inappropriate for 21st-century Russia, and accuse leftists of seeking to take the country back to the USSR by reintroducing the tune and adopting other Soviet icons.

TITLE: Moscow Unrepentant Over Weapons Sales to Iran
PUBLISHER: Reuters
TEXT: WARSAW - Russian Foreign Minister Igor Ivanov on Thursday shrugged off a U.S. threat to impose new sanctions on Moscow over arms sales to Iran and said it alone would choose its own trade partners.


Ivanov, addressing a news conference alongside his Polish opposite number, Wladyslaw Bartoszewski, made no reference to the recent Russian decision to pull out of a 1995 deal with Washington on curtailing arms sales to Tehran.

But he made clear Moscow would stand for no interference in pursuing its trade interests, dismissing a U.S. list including Iran among states alleged to sponsor terrorism along with Cuba, Iraq, Libya, North Korea, Sudan and Syria.

"Russia bases its acts on close adherence to its international commitments, also in the case of Iran. We will continue to do so," he said in response to a question about the deal.

"If someone creates his own lists, it is a question of the competences of that state."

In Moscow, Russia's Foreign Ministry declined to comment on U.S. reports that new sanctions could be imposed on Moscow after Ivanov informed Washington just before the U.S. presidential election that it was backing out of the deal.

Interfax news agency quoted unidentified sources as saying the decision was linked to "positive changes in Iran's internal political situation". They also said the United States had violated the accord by publicly disclosing its terms.

The sources also referred to supplies of U.S.-made arms acquired by Taleban authorities in Afghanistan, viewed by Moscow as a source of destabilisation in the region.

Russian Defence Minister Igor Sergeyev, also in Moscow, made no comment on the Russian withdrawal from the agreement. But Interfax quoted him as saying no arms of mass destruction would ever be supplied to Iran.

The deal, which was signed in 1995 by U.S. Vice President Al Gore and then-Russian Prime Minister Viktor Chernomyrdin, barred Russia from signing new contracts for Iranian purchases of conventional weapons. The existing contracts were to be completed by 1999.

The issue sparked a foreign policy controversy during this year's U.S presidential campaign, with Republican critics denouncing Gore's policy of engaging Russia as a failure.

Russia sees trade with Tehran as a lucrative source of revenue and experts say new accords and the resumption of frozen deals could bring in billions of dollars.

TITLE: IN BRIEF
TEXT: Russia, Poland Talk

WARSAW (Reuters) - Russia and Poland took the first steps on Thursday towards ending a decade of mutual mistrust and flagging economic relations since the collapse of the Soviet bloc.

Russian Foreign Minister Igor Ivanov said his talks with Polish leaders had brought the two countries closer to a new chapter in mutual relations.

Polish diplomats said that Ivanov's trip indicated that Moscow had come to terms with Poland's NATO entry last year.


German Joyriders

FRANKFURT, Germany (Reuters) - Two drunken Germans, looking for a toilet at a Frankfurt airport, got on a plane by mistake and flew to Moscow.

After wandering around the airport, the 20-year-old men found themselves on the tarmac and boarded a bus that drove to a Lufthansa plane bound for Moscow.

"They got in and sat in the back of the airplane, which then flew to Moscow," said Frankfurt state prosecutor Job Tilmann. "They weren't even at the airport to fly anywhere. They were at a conference and walking around, evidently in a drunken stupor."

Russian police put them on a flight back to Frankfurt, where Federal Border Police charged them with joyriding. 


MSF Slams 'Terror'

BRUSSELS, Belgium (Reuters) - Nobel Peace Prize-winning Medicins Sans Frontieres (MSF) on Wednesday condemned Russia's "policy of terror" in Chechnya, which it said included arbitrary executions and ethnic cleansing.

In a report entitled "Chechnya, the politics of terror" issued in Brussels, MSF also criticized what it called international indifference to the Chechens' plight.

"People are forced to live in a ghetto, which locks them into a deadly day-to-day confrontation with the Russian army. They cannot move freely and the wounded and sick are prevented from passing military barriers," MSF said.

Siberian Earthquake

MOSCOW (AP) - An earthquake shook towns in southern Siberia, but there were no reports of injuries or damage, an official said Wednesday.

The quake, with a magnitude of 4, struck Tuesday morning near the Russian-Mongolian border, said Emergency Situations Ministry spokesman Andrei Rulyov.

TITLE: Recriminations in Moscow Cold Comfort for Far East
AUTHOR: By Igor Semenenko and Nonna Chernyakova
PUBLISHER: Special to The St. Petersburg Times
TEXT: VLADIVOSTOK, Far East - President Vladimir Putin calls it "a crying shame." UES head Anatoly Chubais blames Primorye Gov. Yevgeny Naz dratenko. The governor, in turn, sees a conspiracy between the cabinet, the media and the IMF.


Finger-pointing in the State Duma on Wednesday notwithstanding, the energy crisis in Primorye remained unresolved. As Chubais, Nazdratenko and others were grilled at parliamentary hearings, tens of thousands in the Far East continued to shiver without heat at home or at work.

"The problem is beyond our control," Chubais said in an address to the Duma. "We can deliver heat, but we cannot channel it through the destroyed municipal infrastructure." 

About 40 percent of the heat supplied to consumers by the Primorye subsidiary of Unified Energy Systems, Dalenergo, is being lost due to inefficiency of the supply network, which has been plundered by thieves seeking nonferrous metals to sell. 

"Every metal part that shines has been unscrewed," Dalenergo general director Yury Likhoida said in an interview broadcast on a Vladivostok television station earlier this year. 

Dalenergo's customers owe 4.2 billion rubles ($150 million), or the equivalent of the company's annual revenues. Chubais said in televised remarks on RTR television that only 11 percent of that debt is owed by the federal government, while some 80 percent falls on municipal authorities. 

"The financial mechanisms are destroyed to such a degree, that even urgent measures will not help," Chubais said. "What is needed is a long-term program, but I do not see one, even on the horizon." 

Several cities in Primorye, including the former mining settlements of Ar tyom and Kovalerovo, were left to freeze this winter. But regional officials claim the situation has been blown out of proportion by the media. 

Vladivostok Mayor Yury Kopylov said in a recent interview on RTR's local subsidiary, PTR, that reports broadcast by the country's three main television stations have been "ordered from Mos cow" to discredit local authorities. 

Gov. Nazdratenko echoed Ko py lov's remarks at Wednesday's Duma session. 

Meanwhile, the Emergency Situations Ministry has said tens of thousands of people in the region are receiving insufficient power supplies. 

The editor of the Business Ars weekly in the industrial town of Arseniev said 60,000 people there have no heat. 

"The temperature in homes is 10 degrees Celsius and the water coming from the tap is ice cold," said Yevgenia Khokhlenkova in a phone interview Wednesday. 

Last week, Deputy Gov. Konstantin Tolstoshein said at a press conference that the main problem in Kovalerovo is a lack of stokers in the boiler rooms. But an NTV report from the town showed a grimmer picture Wednesday. 

The radiator in World War II veteran Ivan Sundiyev's apartment has been cold for weeks, according to the report, and the old wounds in his leg aren't letting him sleep. 

"I keep tossing and turning," Sun di yev said. "Because of my leg. But cutting it off would be a shame." 

A week ago, Kovalerovo's prosecutor, Sergei Vedernikov, initiated a criminal case into the lack of heating in the town.

TITLE: Swedish Queen Visits City's Children
AUTHOR: By Irina Titova
PUBLISHER: Staff Writer
TEXT: Queen Silvia of Sweden and her daughter, Princess Victoria, paid a one day royal visit to St. Petersburg this week that involved excursions to orphanages and a juvenile prison. 


Though these were hardly the city sites one would think would interest royalty, Queen Silvia was actually on a mission to check up on her own organization, The World Childhood Foundation, which she started and which financially helps several local children's institutions. 

"They came to see how the money allocated [by the fund] is being spent here and what else can be done to help the children," said Cecilia Wilmhardt, the Queen's press-officer.

A visit by the Queen to the girls in the Malookhtinsky Shelter for the sexually abused took on fairy-tale- like characteristics as the girls spent hours anticipating the Queen's arrival and trying to guess what she would look like. 

Some notions came from books remembered from youth. 

Anna Tambovskaya, 15, said that the Queen would arrive in a long dress and a crown. 

Others, like 17-year-old Yulya Yegov kina, had a more contemporary view of royalty. 

"The queen should be young and have a short haircut," she said. "For some reason I think queens do not have long hair and she should have trousers on."

In reality, Queen Silvia and Prin cess Victoria arrived in a limousine, flanked by security and wearing modest gray and orange dress suits with scarves and only a hint of jewelry. 

The girls, meanwhile, went about their daily routine of drawing, reading, computer classes and counseling sessions. But their anxiety was palpable - they wanted to talk to the Queen and the Princess. 

Finally, they were given the opportunity when Queen Silvia gathered them around. 

Yegovkina asked the Queen if she could have her photo taken with her, and said afterwards that the queen had hugged her tenderly.

"She was like a mother," said Yegovkina. "I felt like crying at that moment," she continued.

The girls also sang a song composed specially for Silvia's visit, the lyrics of which were about "the small country of Sweden, where every child has a good childhood and also helps other children." 

The queen and princess also visited the Lebedeva, a prison for young boys aged between 10 and 18, which has been a beneficiary of the World Childhood Foundation for 10 years. 

Primarily the organization works to improve the prison's harsh conditions and extend its educational facilities. This year alone, the foundation has spent $22,000 on clothes and food for the young prisoners. 

During their visit, the queen and princess went to each of the overcrowded cells and shook hands with the inmates. 

After Lebedeva, the royals visited other beneficiary organizations like the Korchak Center for Orphaned Teenagers and the Almus Shelter for Small Children.

TITLE: Arafat To Meet Putin Over Peace Prospects
AUTHOR: By Martin Nesirky
PUBLISHER: Reuters
TEXT: MOSCOW - Palestinian President Yasser Arafat, urgently seeking support from Moscow and signaling a desire to restart stalled peace talks, will meet President Vladimir Putin on Friday to discuss violence in the Middle East.


Arafat and Israel have repeatedly urged Russia - nominally co-sponsor of the peace process with the United States - to get more involved in efforts to halt two months of violence in which at least 260 people have died, mostly Palestinians.

"Tomorrow there will be a meeting between Putin and the head of the Palestinian Authority," Kremlin spokes man Alexei Gromov said on Thursday.

"The meeting has been arranged at the request of the Palestinian side. I can add nothing else for now."

Israel said earlier that Arafat, last in Moscow in early August, had signaled a desire to revive deadlocked peace talks and end the two months of violence. Putin spoke to Arafat only by telephone on his last visit.

Russia has played a muted second fiddle in the peace process for a long time, its influence in the Arab world less useful while Arafat and the Israelis were talking.

It has called for international efforts to halt the violence and Foreign Minister Igor Ivanov recently toured the region.

Ivanov has also spoken in the past 48 hours to several UN and Western leaders, agreeing international pressure is essential.

The Palestinian diplomatic mission in Moscow made clear Arafat was likely to seek at least Moscow's moral support.

It said in a brief statement Arafat would hold talks with Putin on "the latest developments in the Middle East region in the light of the dangerous situation resulting from the constant escalation of Israel's aggressive actions."

Apart from noting the Putin-Arafat meeting was at the Palestinians' request, Moscow gave another indication it did not wish to appear overly partisan.

The Russian Foreign Ministry condemned a car bomb attack in northern Israel which killed at least two people and injured 62 on Wednesday. It called on Israelis and Palestinians to show restraint and avoid a vicious circle of tit-for-tat blows.

"[The attack] was clearly aimed at provoking yet more confrontation between Palestinians and Israelis and further escalating tensions," the ministry said in a statement.

In August, Moscow cautioned Arafat against declaring an independent Palestinian state unilaterally.

Israeli Foreign Minister Shlomo Ben-Ami said earlier on Thursday U.S. Secretary of State Madeleine Albright had told him in a phone call that Arafat had expressed a desire to renew talks which have been severed since the outbreak of Israeli-Palestinian fighting.

Russian news agencies said Arafat had sent an urgent message to Putin through Russia's representative in the Palestinian territories, Sergei Peskov, on Wednesday to ask for the meeting.

Arafat is expected to arrive in Moscow on Friday around noon and head straight to the Kremlin. Putin has spoken to Arafat and Israeli Prime Minister Ehud Barak in recent weeks.

TITLE: Navy Still Backing the Theory That Foreign Sub Sunk Kursk
PUBLISHER: Combined Reports
TEXT: MOSCOW - In a newspaper interview published Tuesday, a top Russian admiral reiterated the claim that the Kursk nuclear submarine was likely sunken by a Western submarine and said that the foreign vessel emitted SOS signals shortly after the disaster.


"The Polinom hydro-acoustic system located SOS signals sent by a mechanical transmitter," Northern Fleet chief Admiral Vyacheslav Popov told Nezavisimaya Gazeta, referring to Russian naval surveillance equipment.

"Further spectral analysis made by the Northern Fleet laboratory showed that the signal belonged to a foreign submarine in the area," Popov said. "The Kursk had no such [signaling] device," he added.

Naval officials initially thought the tapping sound was coming from inside the Kursk, indicating that the crew could be calling for help.

They later said the sound had likely been caused by collapsing equipment or the submarine settling into the Barents Sea bed.

On Sunday, Deputy Prime Minister Ilya Klebanov, who is leading the government commission investigating the disaster, claimed that the sound was an SOS signal coming from another vessel.

Klebanov said that the cause of the Aug. 12 disaster remained unknown. Experts were still considering an internal malfunction, a collision with a foreign submarine or a World War II mine.

The United States and Britain, whose submarines operate in the Barents Sea, have said their vessels were monitoring Russian naval exercises but were not involved in the accident. But the Russian navy continues to insist that a collision with a foreign submarine was the most likely cause of the Kursk sinking.

Popov said that the government commission had a "large number of indirect signs showing that the Russian submarine sank as a result of collision."

Naval officials have previously said that they had seen an emergency buoy allegedly left by a foreign submarine, although they failed to pick it up or provide any other evidence that would back the collision theory.

TITLE: Work on New Caspian Oil Link Finished
PUBLISHER: Combined Reports
TEXT: MOSCOW - The Caspian Pipeline Consortium of international oil giants said Wednesday it had welded the last joint in an $2.5-billion oil pipeline connecting petroleum fields in western Kazakstan to a marine terminal in the Russian Black Sea port of Novorossiisk - giving a boost to Russia's ambition to control a main route to world markets. 


The 1,730-kilometer pipeline will initially carry 28 million tons of oil per year from the Tengiz oil fields to Novorossiisk. The first test shipment of crude to be carried by the pipeline is scheduled for June 30, 2001 after pumping and signaling equipment is installed. 

The initial construction phase will be completed next October, said a spokesperson for CPC, Natalia Prutkov skaya. 

The projects's cost is estimated at $2.5 billion, of which companies from six countries participating in the consortium have already invested around $2 billion. 

Russia owns 24 percent of CPC and U.S. oil major Chevron has 15 percent, while Kazakstan, which is believed to have the region's largest oil deposits, and Oman have 19 percent and 7.0 percent, respectively. 

Other CPC shareholders are LukArco, a consortium of Arco and Rus sian No. 1 oil producer LUKoil, with 12.5 percent, Rosneft/Shell Cas pian Ventures with 7.5 percent, Mobil Caspian Pipeline Company with 7.5 percent, Agip and BG with 2.0 percent each, and Kazakstan Pipeline Ventures and Oryx with 1.75 percent each. 


- AP, Reuters

TITLE: Gazprom Plan Opens Doors For Foreigners To Buy Shares
AUTHOR: By Elizabeth LeBras
PUBLISHER: Staff Writer
TEXT: MOSCOW - The management of Gaz prom is taking initial steps to fulfill a promise made on Oct. 27 by its board to liberalize the market in the natural gas monopoly's shares.


Gazprom executive Alexander Semenyaka announced the new proposals Wednesday at a conference of professional stock market participants in St. Petersburg, Izvestia reported.

The management's main proposal is to launch a two-tier auction system. During the first auction, Russian shareholders will buy local shares from either Gazprom or the government, which they will subsequently sell to foreign investors at a second auction. 

"The holding of auctions will increase the liquidity of Gazprom shares, both on the domestic and on the external market," Interfax reported Semenyaka as saying.

Foreigners own a total of 5.3 percent of Gazprom's shares. German gas firm Ruhrgas holds a 3.8 percent stake, while the remaining shares are traded as American Depositary Receipts.

ADRs are devices which allow foreign firms to buy over-the-counter on the New York Stock Exchange certificates that cover a set number of shares.

However, foreigners are prohibited from buying Gazprom's domestic shares and the auction system would give them a means to do so.

United Financial Group brokerage said Thursday in a research note that the motive of the Gazprom management in putting forward the new proposals is to preserve the existing wall between domestic and foreign shareholders.

It said the auctions would effectively create "a third class of Gazprom shares" as the shares to be sold to foreigners will not be convertible into existing ADRs. 

UFG contends that Gazprom's new proposals will only benefit insiders and advises investors not to support them. 

Semenyaka also said Gazprom management will resume its efforts to raise the limit on foreign ownership from 20 percent to 40 percent.

Steven Dashevsky, oil and gas analyst for the Aton brokerage, however, interprets the proposals more positively.

He said the new proposals indicate the company's commitment to liberalize its market of shares. He admitted that they represent a "half-way measure" and "don't go as far as some would like."

TITLE: Sberbank Case Reopens Arena Money Questions
AUTHOR: By Andrey Musatov
PUBLISHER: Special to The St. Petersburg Times
TEXT: St. Petersburg's Sberbank has filed a lawsuit against the Ice Palace, seeking payment for part of a $20 million loan that it gave the company that runs the stadium. 


The case, filed Oct. 5 in the St. Petersburg and Leningrad Oblast Arbitration court, would seem a straightforward enough case of alleged loan default.

But the suit has opened a financial Pandora's box of creditors, debtors and a Finnish construction company whose management seems to have evaporated. The bank is calling in the loan, and it is not even clear how much was budgeted to build the stadium. 

As such, Sberbank - one of four banks that agreed to help finance the project - may have a long wait in recouping its loan. 

The Ice Palace project began in December 1998 in preparation for the Year 2000 World Ice Hockey Championship held in St. Petersburg last April and May. To build the state-of-the-art stadium, the city formed the Ice Sport Palace joint-stock company, the target of the Sberbank suit.

At present, the city owns 100 percent of the shares in the Ice Palace. 

The original plan, according to city officials, was to secure loans from the banks with the city budget as guarantor. The banks involved were BaltUneximbank, Baltiisky Bank and Bank Menatep, St. Petersburg. 

Sberbank's loan of $20 million was given as a mortgage,with the stadium itself put up as collateral.

It was thought at the time that the contracts were signed, that the banks would recoup their investments by using the Ice Palace as a venue for concerts and sporting events once the hockey championships were over. 

But this has not proven to be the case, and ferreting out who owes what to whom has brought on buck-passing - without passing any bucks. 

Alexander Afanasiyev, spokesman for Gov. Vladimir Yakovlev, said Thursday that he knew nothing about the suit and that questions should be directed to finance committee. 

According to Sergei Krotov, the head of the Finance Committee, Sberbank says the city owes it 14.5 million rubles (about $520,000). He said a date for a hearing has yet to be set, but that the litigants should negotiate. 

"[All] three sides [including the city, which owns 100 percent of Ice Palace's shares] must negotiate in order to find some other solution." 

Krotov's deputy, Vladimir Gaidei, contacted in a separate telephone interview, said the city had no responsibility to pay off Sberbank from the city budget at all. 

"That was a straight credit from Sberbank to the Ice Palace and the city budget has nothing to do with that agreement," Gaidei said.

Officials contacted Thursday at Sberbank refused to comment on the suit and Ice Palace general director Sergei Isotov was unavailable for comment.

Indeed, no one is sure how much the project cost. 

The stadium was built by the Finnish construction firm Skanska, for a then- quoted price of $84 million. But a phone call to the company Thursday was unable to reconfirm this figure. According to a secretary named Natalya, who would not give her last name, those associated with the project have left the firm.

"They've all gone," Natalya said. 

The original quote is at any rate in variance with what many city legislators have heard. Yabloko Legislative Assembly Deputy Boris Vishnyovksy said $60 million was the going rate in December 1998 when the contract was signed. 

When the stadium was initially proposed, Yakovlev pledged that no city funds would be spent on the project - even though the city budget was securing most of the loans. Come February, Yakovlev disbursed $5.5 million from the budget to Baltiisky bank toward a $9.5 million loan. The bank has given the city until the end of the year to come up with the remaining $4 million. 

The $2.5 million owed to Menetep and the $7.9 million due in April to Baloneximbank are matters about which both banks are keeping silent.

TITLE: City's Hotel Prices 8th in World
AUTHOR: By Inna Kolomeiskaya and Dina Vishnya
PUBLISHER: Vedomosti
TEXT: The city's hotels have cracked the top 10 in a survey of the world's most expensive rooms while Moscow has dropped from fourth to 17th place in the last year.


According to a survey conducted by British agency Business Travel International, or BTI, for business travelers, St. Petersburg has moved up from 15th to eighth place.

Fierce competition by Moscow hotels can explain the rapid reduction in prices of business-class rooms in the capital.

In St. Petersburg, however, where no such competition exists, hotels can allow themselves the luxury of charging astronomical prices.

In St. Petersburg there are a third as many business-class hotels as in Moscow.

"It is specifically because of this lack of competition that the St. Petersburg hotels are able to keep prices at their current levels," Maria Smirnova, head of the information department at the University for Moscow's Hotel, Tourism and Restaurant Business Association, said. 

Another reason for high prices is the greater tourist potential of the northern capital. 

The prices for St. Petersburg's five-star hotels over the past year to 18 months have not changed. 

In 1999 the average price over the year was $184. This year the same figure was $180. In the Grand Hotel Europe the average price for this year is $218. The average demand for high-class hotels has increased from 46 percent in 1998 to 56 percent in 2000. 

In the near future, competition may be growing in St. Petersburg. 

A Radisson-SAS four-star is to open in mid-2001. In addition, the 200-room Severnaya Korona hotel is nearing completion. The hotel has been under construction for the past 10 years. 

Natalya Belik, public relations director with Sheraton Nevskij Palace, said that the emergence of new four- and five-star hotels in St. Petersburg could well bring about a fall in prices.

The direct price for business-class rooms in Moscow hotels is $200 to $250 per night. But these prices are paid only by those who travel independently and check in without prior reservations. 

Discounts are allocated to travel agencies and for advance bookings. Corporate clients, who account for about 60 percent of the hotel trade in the capital, can get reductions of up to 50 percent.

TITLE: Tax, Finance Officials Blast Tax Reforms
AUTHOR: By Anna Raff
PUBLISHER: Staff Writer
TEXT: MOSCOW - Despite recent accolades from foreign investors and international financial organizations, the state of Russian tax reform received a shrill wake-up call Wednesday from its harshest critics - finance and tax officials themselves.


"Is there any overarching concept of tax policy in the government? Unfortunately, no," said Andrei Makarov, former State Duma deputy and now head of the Duma's expert group on taxes. "Thank god there are so many loopholes in the reforms already passed. This means that business will survive."

Tax experts, accountants and government officials gathered at the second annual conference of the Russian branch of the International Fiscal Association, or IFA, to discuss the potential consequences of new laws and draft legislation in the works.

The conference coincides with the Duma's vote on corrections to the tax code, which is scheduled to take place this week.

Alexander Pochinok, former tax minister and current labor minister, said he had a "pipe dream" that legislators would one day have time to pass a coherent tax code that wouldn't need hundreds of corrections. "We need several years of quiet work without interference from lobbying groups," he said.

Time won't make much of a difference, said Vladimir Panskov with the State Audit Chamber, the Duma's budgetary watchdog. "You are deeply delusional if you actually think reform is happening in this country," Panskov told the conference participants.

Many mistakes are made when the government is pressured to rush tax legislation through, Panskov said. "When Gazprom owes 40 [billion] to 50 billion rubles just to the federal budget, we need to ask ourselves about our attitudes to tax policy," Panskov said. "Why should they be given a deal outside the framework of tax law?"

He recommended that work on the tax code stop so that officials had some time to analyze what exactly they were doing.

When the dialogue turned to drawbacks of the new system that will go into effect Jan. 1, 2001, Alexander Privalov, an analyst at the financial analysis company Ekspert, held little back.

"What has been put forward are compromises between the Duma and the executive branch, between the Ministry of Finance and the Tax Ministry," Privalov said. "This is wonderful. But where is the second party? Where is business? Business interests are not being presented."

Privalov pointed out that the new unified social tax, which was intended to alleviate the burden on businesses, does nothing for Russians who earn less than $300 a month, a majority of the population.

Coming into effect at the beginning of next year, the unified social tax will replace companies' contributions to the pension, social insurance, medical insurance and employment fund. Each month, all of these contributions had to be filed separately.

According to Valentina Muratova, chief accountant for Transtelecom, the paperwork is going to get worse before it gets better.

"The way the law is drawn up, we'll have to wait in even more lines and file even more documents," Muratova said.

"It will in fact become cheaper for employers, but the difference is negligible," Privalov said. For the majority of the population, 54 percent of their gross income is swiped away in taxes. After Jan. 1, this will decrease to 48.6 percent.

Ludmilla Mamet didn't jump to criticism and tried to put Russia's tax history in perspective. Mamet, senior tax partner with PricewaterhouseCoopers and IFA member, is someone who understands the system - she worked on revisions to the Soviet Union's tax code in the 1980s.

"Tax reform is going to be a long process, no matter how much we would like to attain it in one fell swoop," said Mamet. "Like any other reform, its going to evoke a stream of criticism. It's not a piece of candy; not everyone is going to like it.

TITLE: Svyazinvest Outlines Shares Plan
PUBLISHER: The St. Petersburg Times
TEXT: Investors could be trading Svyazinvest's consolidated mega-operators on the U.S. stock exchange by 2003, according to a timetable, which was laid out by company representative Sergei Chernogorodsky at a securities market conference held in St. Petersburg on Wednesday.


Revealing another sliver in Svyazinvest's gargantuan consolidation plan, which calls for the merging of 86 operators into seven, Chernogorodsky projected the release of level-one ADRs, or American Depository Receipts, for four of its daughter companies to begin in May or June of 2001, with level-two ADRs to be launched by April 2002 and level-three ADRs issued in 2002 or 2003, participants in the conference said. 

The four companies earmarked to be listed next year are St. Petersburg Telephone, Mos cow Regional Elektrosvyaz, Novo sibirsk Elektrosvyaz and Primorye Elektrosvyaz. The lift to level-two ADRs in early 2002 will include three operators already listed at level one - Uralsvyazinform, Kubanelektrosvyaz and Nizhnosvyazinform. This stage requires the companies to report under International Accounting Standards, or U.S. GAAP in this case. 

Chernogorodsky also indicated that Svyazinvest might agree to give up control of the seven regional telecoms in order to attract strategic investment.

Mustcom - the offshore consortium of domestic and foreign investors that has a 25 percent plus one blocking stake in state-controlled Svyazinvest - has expressed interest in gaining shares of the consolidated assets. George Soros and Vladimir Potanin both have significant stakes in Mustcom, which was formed in 1997 to purchase the Svyazinvest stake for almost $2 billion.

Shareholders meetings in 2001 could reveal detailed blueprints for swap-ratio schemes that will give shareholders in the smaller operators stakes in the new ones.

TITLE: New Government Strategy Targets Waste in Energy Usage
AUTHOR: By Julie Tolkacheva
PUBLISHER: Reuters
TEXT: MOSCOW - With state coffers overflowing with petrodollars but thousands freezing without heating in the Far East, the Cabinet on Thursday gave preliminary approval to a long-term energy strategy. 


A government plan for the period up to 2020 urges maximum efficiency in the use of natural resources in a country where oil and gas is plentiful but where energy is often wasted due to the economy's deep structural problems. 

The document was discussed at a Cabinet meeting that took place as tens of thousands of residents of the Primorye region in the Far East shivered in their homes as cash-strapped power stations cut supplies for want of fuel. 

Prime Minister Mikhail Kasyanov said the country's energy situation was very complicated, with a Soviet-era legacy of wasteful consumption and a failure to find a substitute for gas, the production of which is becoming increasingly expensive. 

"Given economic growth and the accompanying growth in energy consumption of 20 percent by 2020, the seriousness of this problem will grow," Interfax quoted him as saying. 

"This is a key issue for us, but today we are making the first approaches in this sphere." 

Energy Minister Alexander Gavrin told reporters that the long-term energy strategy would be fine-tuned within three months and resubmitted to the government. 

Gavrin said $700 billion was required to implement the program, with 80 percent of the funds coming from domestic resources, including higher fuel tariffs. Decades of cheap fuel have given Russians little incentive to implement conservation measures. 

Energy consumption is rising along with economic growth. Gross domestic product is set to rise a record 7 percent this year, thanks largely to recent high international prices for energy and commodities. 

Gavrin said the share of gas in the nation's fuel balance should drop. Russia's main gas deposits in Western Siberia have been largely exploited and have limited potential for producing more. 

A government document prepared for Thursday's meeting said output of oil and gas would both depend largely on market conditions, although gas development would depend more on prices. 

It said crude oil output, given a favorable market, could rise to 335 million metric tons per year by 2010 and to 360 million tons by 2020, while natural gas output could be 655 billion cubic meters and 700 billion cubic meters per year respectively. 

This year's oil production is expected to be about 320 million tons and gas production 577 billion cubic meters. 

The long-term energy strategy envisages significant exports, rising to 600 million tons of fuel equivalent from the current 506 million tons. 

"However, increasing supplies to external markets should end by 2012-2015 if the economy develops favorably," it said, adding that exports will depend largely on the relationship between world prices and domestic production costs.

TITLE: EDITORIAL
TEXT: Oil Boom Covering Up Bigger Woes 


RUSSIA and the IMF have come to the delightful conclusion that they don't really need each other. After all, why should Russia borrow Western money at interest, when it can earn it hand over fist thanks to oil at $30 a barrel? With prices like that, Russia can even pay its Soviet-era debts (although much Soviet-era debt can be repudiated with only good consequences for Russia).


The bad side of the oil boom is that it breeds a complacency about economic policymaking.

True, there have been some minor triumphs on this front. Simplified and lower customs tariffs have been worked out. New tax rules kick in Jan. 1. And a bold new policy could force oil companies to bid at auction for export quotas (instead of winning them in secret deals).

But all those triumphs come with caveats. The customs tariffs and export quota auctions remain mere proposals - while the much-discussed 13 percent flat tax is actually a 1 percent tax hike for the vast majority.

And if those are the triumphs, consider the failures. The tax minister has just been caught using a common tax dodge to pay his staff more. The press minister has repeatedly and inappropriately meddled in a purported business dispute between Gazprom and NTV's parent company. The communications minister has publicly expropriated frequencies from two leading mobile phone companies, then grudgingly returned them. None of those men has suffered any real official censure.

The nuclear power minister, meanwhile, is lobbying to import nuclear waste products for cash, a truly terrible idea; he also talks of stiffing foreign shareholders in the UES power grid because "we don't see them investing ... all of our existing energy sector was built in the Soviet era, only on the money of our people." 

The prime minister, in turn, continues to harry Kiev over its future privatizations - most recently, by striking a deal this week to let Russia spend Ukraine's gas debts as chits to buy Ukrainian state properties. (Why?) 

The Central Bank remains the lord of its own dubious commercial empire, even as it does next to nothing to clean up the embarrassments of the national banking sector. The Kremlin is talking of opening five-star hotels and gem auction centers. And Moscow is busily preparing to absorb Belarus, with all of its economic cancers, and has offered it $100 million by the year's end as a vague sort of a "get well soon" credit - even as Chechnya heads into another hellish winter, having only received a third of the $80 million or so promised it this year.

The oil boom is papering over a lot of problems.

TITLE: MARKET MATTERS
TEXT: Raid on Bank Is Sign of City's Newer Status 


WHAT I would normally regard as a pleasant fact - the growing role of St. Petersburg banks in the national economy - was confirmed last week in a more unpleasant way when investigators from the police, backed up by dozens of armed OMON paramilitaries, paid a visit to the headquarters of the region's largest bank, Promyshlenno-Stroitelny, and confiscated various documents. 


Many observers have speculated that the raid was connected to one or some of the bank's numerous clients, which would make this a routine operation: A number of banks have undergone similar searches, and many of them have clients whose not entirely legal actions they are not responsible for.

If this is the case - if the investigation's target was a PSB client - then the only reason for PSB to get hot under the collar (and they did) was because of the style of the raid (heavily armed men encircling the building, for one thing), and the damage that may or may not have been done to the bank's image. It was especially unfortunate for PSB that the raid took place just a day before its 10th anniversary.

However, after 24 hours of silence, and on the very evening of the celebrations, the City Prosecutors' Office came out and said that the investigation had in fact been initiated over members of PSB's management, who had reportedly bribed an official with the St. Petersburg administration. The bribe was apparently in the form of a loan, with the unknown official taking the money in return for transferring an unspecified section of the city budget to PSB's accounts - a loan which, for whatever reason, was never repaid and never meant to be.

So, the question is: Who spoiled the party? Those following the case, including high-placed representatives of other banks in St. Petersburg and Moscow, are saying that there is no power structure in PSB's home town that would stick its neck out and start causing the bank problems. This is an institution that is known as the president's bank, after all, ever since Vladimir Putin declared an account with PSB and several shares he holds in the bank, financial facts he made public before the elections in March.

But it is also known that people in Putin's team support the bank's current Moscow expansion, such as installing ATMs in the White House and State Duma, or supplying plastic cards to government officials and deputies. Which begs another question: What are the president's men getting in return?

PSB itself has alluded to the political line weaving in and out of the whole affair - the bank's director, Olga Kazanskaya, made reference to it at a press conference at the end of last week, adding how damaging the raid was to the "positive changes" we are supposedly experiencing in the economy and in society as a whole.

Meanwhile, the financial world is pondering several versions, none of which seem to be mutually exclusive. One is that Boris Berezovsky, enemy of the St. Petersburg team, is behind it. Another says that it was aimed at PSB owner Vladimir Kogan, who has been mentioned as a successor to the chair of the Central Bank. Yet another points to potential damage done to the position of Gov. Vladimir Yakovlev.

Whatever the reason, this is the kind of raid that used to happen only to Moscow banks. The head of the City Association of Commercial Banks, Vladimir Dzhikovich, has said that he never expected this kind of thing to happen in the northern capital. But once the banks were insignificant; now their time has come. And the politics has come with it.

TITLE: Putin's Bold Move Awaits Election of U.S. President
AUTHOR: By John Pastore and Peter Zheutlin
TEXT: WHILE Americans were busy counting and recounting votes in Florida and the whole world seemed to be in pause mode waiting for the outcome of the U.S. presidential election, President Vladimir Putin dropped a proverbial bombshell, which - as ill luck would have it - is likely to receive far too little notice given the post-election chaos. Putin, too, is conducting a recount it seems - of his nuclear weapons stockpile - and the numbers he's coming up with just aren't adding up. With Russia's military spending down to about $5 billion per year (compared with U.S. military spending of approximately $300 billion per year), and his economy in tatters, Putin seems to have come to the inevitable conclusion that trying to maintain nuclear parity with the United States is a losing proposition. 


Today, a decade after the Cold War, the United States and Russia retain tens of thousands of nuclear weapons, many of which, astonishingly, remain on hair-trigger alert, ready to be launched at just a moment's notice. That is why it was so shocking when, earlier this month, Putin went beyond previous calls for Russia and the United States to reduce their nuclear arsenals from current levels to around 1,500 warheads per side. Without specifying a number, he said reductions could go well below that number. The United States should seize the moment and immediately open high-level talks on the basis of this proposal. 

It would be a disastrous mistake to conclude from Putin's latest offer that the United States should simply hang tough and wait until Russia drops out of the nuclear weapon competition entirely or remains in the race merely symbolically by clinging, perhaps, to a mere few hundred warheads. 

First, even with such a "symbolically" small nuclear arsenal Russia could wreak incalculable devastation on the United States or Western Europe. Indeed, a 1998 study in the prestigious New England Journal of Medicine by Physicians for Social Responsibility reported that just 16 warheads fired at U.S. targets from a single Russian Delta-4 submarine could cause as many as 6 million immediate deaths, and just as many, if not more, injuries from radioactive fallout and other after-effects. Under what circumstances would the United States possibly take such a risk? 

Second, Putin's offer - even if made out of weakness - must stand on its own merits, and the United States should not be afraid to accept the challenge. Earlier this year, the United States, Russia and the more than 180 other nations that have signed the Nuclear Non-Proliferation Treaty reaffirmed their obligation under that treaty to abolish nuclear weapons altogether, wisely stating that the elimination of nuclear weapons was "an unequivocal undertaking." And, a few weeks ago at the United Nations, the United States voted in favor of a resolution that calls for complete nuclear disarmament under international agreement. While the very last steps in such a process are likely to be the most difficult, the United States can quickly move the world in that direction by reaching an agreement with Russia to reduce nuclear arsenals to a few hundred on the basis of Putin's latest proposal.

Third, the world's last, best hope of preventing the further spread of nuclear weapons lies in rapid progress toward a total global ban on nuclear weapons. Ambassador Richard Butler, the Australian diplomat who was once charged with overseeing the United Nations' inspections of Iraq's nuclear weapons program, recently stated in Boston that all of his experience leads to the conclusion that as long as any nation has nuclear weapons, others will seek to acquire them. Jonathan Schell, writing recently in Foreign Affairs, described the status quo this way: "The current American policy is to try to stop proliferation while simultaneously continuing to hold on to its own nuclear arsenal indefinitely." 

Under an international ban on nuclear weapons there is, of course, always the risk that a nation might cheat and attempt to maintain its nuclear arsenal. However, the risks of defying the international norm would be great for a such a state, far greater than the risk involved in acquiring nuclear weapons in a world where the international norm is a division between nuclear "haves'' and "have-nots.'' Indeed, in a world where the current nuclear powers had agreed to abolish their nuclear arsenals, there would be great global unity of purpose in stopping would-be proliferators and ample conventional military power to enforce the international norm. 

No treaty is perfect and all certainly entail risks. A treaty banning nuclear weapons would be no exception. But which is the greater risk: to live indefinitely in a world where thousands of nuclear weapons are on hair-trigger alert and more and more nations seek nuclear weapons, or living in a world in which an outlaw nation might try to harbor a bomb in the basement? 

Putin has put before the United States a bold proposal to significantly reduce the risk of nuclear war. The next U.S. president, whoever he may be, should not lose this opportunity to say "da.'' It's high time to ban the bomb.


John Pastore is the secretary of International Physicians for the Prevention of Nuclear War, the recipient of the 1985 Nobel Peace Prize. Peter Zheutlin is the organization's associate program director. They contributed this comment to the Los Angeles Times.

TITLE: What Other Papers Are Saying
AUTHOR: by Ali Nassor
TEXT: A series of long-forgotten high-profile criminal probes resurfaced this week, with prosecutors ensnaring a minister, the city's senior judge, a lawmaker and a lawyer in their net. Meanwhile, British premier Tony Blair traveled all the way from Downing Street for a quick pint with President Vladimir Putin, mulling over such bar-room issues as Middle East peace, the U.S. presidential elections and plans for a nuclear defense shield. Cheers!




Off the Hook


Smena prompts its readers to recall a St. Petersburg judge who, about five years ago, acquitted the city's most feared gangsters and freed their boss, confounding all expectations in St. Petersburg's worst-organized criminal case of the decade.


The accused godfather, Alexander Malyshev, was sentenced to only three years in jail including the detention term he had already served - meaning that he was released about five minutes after the court had delivered its verdict.

His right-hand man, Vladislav Kirpichov, was acquitted, the paper says. (He was later gunned down in the city center in a Mafia-style assassination.)

Judging from the way he had handled the case, Fyodor Kholodov, 76, has been drawing suspicions of having had his palm greased on occasions, suggests the paper. Hence, Kholodov may soon stand trial for allegedly having taken a $100,000 bribe to treat criminals with lenience.

Quoting prosecutors, the paper says that sum, supposed to be a gift from Dmitry Yakubovsky - once accused of stealing priceless ancient Mongolian manuscripts from the Russian National Library - was intercepted before it could reach its intended destination of Judge Kholodov. 

The courier was reportedly Yaku bov sky's defense lawyer, Dmitry Ternovsky, who was caught carrying the money. Because he confessed to masterminding the bribery scheme, he was later let off. Like Ternovsky, Kholodov would have been cleared of the charges had he agreed to confess to his misdeeds. But Kholodov is maintaining his innocence, says the paper, in order to leave his 50-year legal career unblemished.



Judge Not


But being a judge, Kholodov and his alleged wrong-doings are outside the competence of any city court, so a special jury from the Supreme Court has been created to look into the affair.


Meanwhile, says Komsomolskaya Pravda, Kholodov - the oldest and the longest-serving judge in the St. Petersburg Municipal Court - is ending his days with a series of bad luck. 

Apart from the $100,000 that he ended up never getting, the same duo of Yakubovsky and Ternovsky added injury to insult by testifying against him at a special session this week.

Yakubovsky's judge-grudge may have something to do with facing a five-year term in the slammer despite his large investment in the legal process, the paper says.

On the other hand, the paper quotes Kho lodov as telling his colleagues that, if there is a case at all, it should be opened on Ternovsky. The esteemed lawyer, claims Kholodov, repeatedly phoned him to hint at the possibility of financial rewards for influencing Yaku bov sky's case - even though he had no intention of taking the case, let alone the money, reports the paper.

Moreover, Kholodov says he was too well-off to be accepting bribes. "My wife and I receive a good salary and pension, and we don't need any supplements," he is quoted as saying - adding that his son left them with valuable "assets" when he departed for America. Even a phone conversation with said son about the bank account and a transfer of a large amount of money hardly constitutes legal grounds for an accusation of any kind, Kholodov says.



Good Old Days


But the prosecutors' endeavors did not stop with the courts this week, says Peterburgsky Chas Pik.


Finance Minister Alexei Kudrin and a bank owned by a close friend had to face the full wrath of the law - not to mention the president, when Vladimir Putin publicly chastised him for poor conditions in the army owing to bad financial policies. Putin went on to promise to protect the military from the wayward experiments of "reformers," hinting at a reform of his own governmental team in the near future.

Then, Promyshlenno-Stroitelny Bank, or PSB, owned by Kudrin's friend Vladimir Kogan, was visited by a group of investigators and armed OMON paramilitaries under a pretext that was vague, to say the least.

The paper tracks back to the period from 1993 to 1995, when Kudrin was St. Petersburg Finance Committee boss, during the era of Mayor Anatoly Sobchak and the dawn of PSB's prosperity and ties to Smolny. Prosecutors had focused some of their attention on the bank at the time, until PSB became the apple of Gov. Vladimir Yakovlev's eye from 1996 onward.

Since Yakovlev's own finance honcho, Igor Artemyev, abruptly left the administration in 1998, the paper suggests him as a possible driving force behind the raid - which does not, however, explain why Artemyev himself should have been called in for questioning just as Kudrin was.

But Novaya Gazeta points out that Kudrin's support for Yakovlev in this year's gubernatorial elections, in which Artemyev ran and lost, may have given Artemyev a bit of a thirst for revenge.


Insider Info


The paper says that Artemyev had access to documents signed by Kudrin when he worked with Sobchak, revealing secret deals on unrealized projects for which loans, worth billions of rubles, were issued by PSB.


Why have law enforcers intensified their probes now? The paper suggests its readers find the answer in the context of the current political intrigue within the federal government in Mos cow, whose seeds germinated in St. Petersburg. 

An article published recently by the Versia newspaper depicts Kudrin as the mastermind behind an abortive attempt to kill the governor of the Kemerov Region, Aman Tulayev, for his alleged role in blocking PSB chief Kogan from purchasing the half-billion-dollar Metallurgicheskaya Investment Company.

This seems to be yet more proof that the PSB-Kudrin affair is the outcome of a power-scramble within the federal government, says Novaya Gazeta.



Raise a Glass


But not by kompromat, killings and police raids alone can such differences be settled. Kommersant says Blair and Putin attempted to resolve international conflicts and strengthen their bilateral relations over a pint or two in a Moscow pub.


Putin had called Blair while he was still aboard the flight to Moscow to suggest a quiet tipple, a proposal that so amused Blair that he agreed without question, the paper says. There was indeed reason to celebrate, suggests the paper, as the two leaders met for a staggering fifth time in one year to resolve issues that, when sober at least, they had so far been unable to get to the bottom of. 

Over beer and munchies, agreements were reached on how to tackle the Balkans, Iraq, the Middle East peace process and the U.S. presidential election, says Kommersant.

TITLE: Mailbox
TEXT: Dear Editor, 

Your article on the subject of using plutonium fuel in fast neutron reactors ["IAEA Gives Backing to New Russian Spent-Fuel Reactors," No. 14] reported the opinions of "experts" representing environmental groups. If the reports are correct then these experts are not experts, but are commenting on the basis of prejudice and ignorance. 


First, Greenpeace nuclear project expert Ivan Farafontov is reported as saying: "So far nobody has managed to construct even a prototype of a reactor that would use plutonium as a fuel." In fact, there is a huge body of experience using such plutonium fuels in Britain, France, Japan, Germany, the United States and even in Russia. France and Britain have the most experience. I know this because I spent 25 years working on the development of such fuels. Several tons of plutonium-based fuels were used in the Prototype Fast Reactor in Scotland and in the Phenix reactor in France. 

In the Soviet Union, plutonium was in demand for weapons, and fast neutron reactor researchers used analogue fuels with enriched uranium but also did many trials using plutonium-containing fuels in five experimental reactors. The common experience around the world is that the technical problems from ceramic- and metal-based plutonium fuels were few, and the main engineering problem is making an economic reactor design with a liquid sodium coolant. 

Second, Valery Melnikov of the Zelyo ny Mir ecological organization is quoted as saying, "If it ever becomes technically possible, we would be only able to use a small part of it and at the same time we would get enormous quantities of plutonium in the air, water and earth." Hundreds of tons of plutonium have already been created by weapons and civil nuclear power programs. Fast neutron reactors and mixed spectrum reactors are the only ways of destroying that plutonium and, if well designed, they can destroy essentially all the plutonium in the fuel. If we don't destroy it, then we have to store. These options are more likely to contaminate our environment. A 1GW fast neutron power station can destroy a ton of plutonium (approximately 100 weapons' worth) and at the same time provide electricity sufficient for a city. 

We have three options: 

1. Store plutonium indefinitely, in which case it could leak into the environment or be used in the future for weapons. 

2. Burn it up completely in fast neutron reactors by mixing it with inert materials that do not produce more plutonium. 

3. Burn it in fast neutron reactors to create a balance of creation and destruction of the plutonium, to provide a more sustainable source of energy from uranium. 

We are living at a dangerous time. We need to protect our environment from the ravages of fossil fuels. Renewable energy sources will be needed in the future together with fission and fusion energy to protect our planet from the greenhouse effect. We also need to destroy the stocks of plutonium and use the energy contained in them. Let us base our decisions on knowledge, not ignorance. 

Juan Matthews 

Obninsk 



Dear Editor, 

I was quite surprised by your editorial ["Russia Can Learn From U.S. Vote," Nov. 17], which reminds me of the old Soviet joke in which every critical comment on Soviet reality was met with "and in America you lynch black people." 


There is no need to react childishly to remarks about flaws in the American election system, even if they are quick and joyful. Why shouldn't one have fun when the situation is really absurd and comical? 

I would like to point out that: 

1. Not only Russian politicians but the whole world is finding the current situation inadequate. 

2. No matter how sorry the state of elections is in Russia, the American system is flawed - what was adequate for the 19th century does not work in the 21st, especially considering that America has such advanced technology. 

3. No matter how much fraud there is in President Vladimir Putin's campaign, the Russian system is more democratic, lucid and more easily understood by voters than the American system. 

4. Fraud is fraud everywhere - in Florida or in Kursk. Change the system and the things that happened in Florida wouldn't happen any more. 

Last but not least: Russia did learn a lot from the U.S. vote, I believe. Could America suppress its ego and learn from Russia? Or does it hurt too much? 

Konstantin Dlutski 

Moscow 



Dear Editor, 

It appears from your article that you have taken offense at some Russian politicians. You say that they have taken joy at the breakdown of the U.S. election machine. 


I don't think that any of our politicians want to gloat over the United States. There is nothing for you to be offended about, especially since many European politicians and mass media have been even more outspoken about the events in Florida. 

The current U.S. presidential election really does give one occasion to draw conclusions, and one of those must be that Russia is on the right path in developing its democratic system - any delays and obstacles notwithstanding. 

By the way, there was no massive vote fraud in the March presidential elections here. This fact was certified by authoritative international commissions. 

Alexander Kudryavtsev

Moscow 



Dear Editor, 

Last August we spent 12 days sailing from Moscow to St. Petersburg, visiting a number of towns and cities on the way. I love Russia. It's friendly, beautiful and a place of great historical values. I would love to return. Russia is certainly not what the North American media portray it to be. Now I'll explain the downside of our trip [in response to "Have Pity on the Tourists," Nov. 3 editorial]. 


We arrived in Moscow on Aug. 3 and met the surly-faced Russian customs officers who didn't even look at us. Not a good first impression. Then an 83-year-old lady traveling with us was discovered to have an invalid passport (her fault). From that point on she was treated like a spy or criminal. Despite our contacting the Canadian Embassy in Moscow and doing everything that could be done - including slipping the Russian authorities between $60 to $100 - they put this elderly "spy" back on a plane to Frankfurt. 

I realize it will take Russia many years to come out of the dark ages of communist rule, but treating an old lady like this is inexcusable. To top it off, as she was boarding the plane back to Frankfurt, the woman was told by the authorities that her Canadian friends had deserted her. 

It's time that customs officials understood that communism is dead and that most people in the civilized world can be trusted. I still loved my visit and would love to return. Best of luck and may God be with the people of Russia. 


Don Taylor 

London, Ontario 

Canada

TITLE: harbin gets too close to work
AUTHOR: by Thomas Rymer
TEXT: Walking in (late, of course) to meet a friend for dinner at the Harbin restaurant, I must admit that my hopes for a good meal were mixed with worries about what that ultimately might mean.


I love Chinese food and, having already been to and reviewed another St. Petersburg restaurant by the same name, was hoping that this experience would turn out to be as rewarding as the first.

At the same time, Harbin is located at the corner of Gorokhovaya Ul. and the Moika river, which is dangerously close to where we hang our hats here on work days. A restaurant too good and too close to work carries with it its own potential danger.

In short, my palette was hopeful and my wallet afraid.

Both made it through all right.

After I apologized for my tardiness (I've pretty much got this down to a science), my friend and I each opted for a beer - his a bottle of Heineken (65 rubles), mine a half-liter of Baltika draft (38 rubles) - and then we set about choosing.

The only real way to eat Chinese food is to grab a few dishes and pass them around. With only two of us, the sharing promised to be pretty simple, and the order we placed assured that the food would be plentiful as well.

We went with an order of Fried Rice with Egg (40 rubles) to be the foundation for the other dishes, and it was a good choice.

For the entrees, we chose to go with a dish from each of the basic categories - and, with one exception, the decision paid off.

The Chicken with Peanuts in a Piquant Sauce (150 rubles) was great - the chicken very tender and juicy, and the spicy-sweet sauce was balanced nicely by the more earthy taste of the peanuts.

The Battered Pork with Fruit Sauce (150 rubles) is also worth a try. Like the chicken, the pork was done perfectly. A meat dish in batter was a bit of a change of pace for me (unless you count corndogs, in which case I might question your definition of meat), but any concerns I had disappeared when I tasted the sauce, which complemented the pork well.

Given that the first two dishes were on the sweeter side, we were looking for a little balance, so we chose the Shredded Szechuan Beef (220 rubles), and this was the only disappointing part of the meal. The dish sounded good as a concept, but in this case the beef was overdone, making it dry and a bit crispy. The Szechuan sauce also suffered as a result, losing its spicy character and ending up more salty than anything else.

The visual highlight of the meal came with the seafood dish. I ordered the Grilled Tiger shrimp (480 rubles), which came fried, split and served on top of what looked to me like a wooden replica of a Viking ship with a traditional Chinese lion's head attached to the front (please excuse my ignorance of Chinese naval design). Although on the pricey side, the shrimp would probably be a good dish to share with a friend (though my friend, as it turns out, is a seafood abstainer) - as long as you're not too particular about getting your fingers a little buttery in the process.

All in all, the Harbin on the Moika is worth a visit. The atmosphere is a little dark, but the seating is arranged well, and the decorations aren't - as often in Chinese restaurants - overly garish. They even have a sizable side room which can be booked for larger gatherings (200 rubles/hr).



Harbin. 48 Gorokovaya Ul. Dinner for two with a little bit of beer 1,246 rubles (about $45). Open noon to midnight daily.

TITLE: drag club celebrates four years of lipstick
AUTHOR: by Tom Masters
TEXT: On its fourth birthday last Saturday, Jungle was packed full of the very people that have these days ceased to be its regulars, having long since left it for smarter establishments on the other side of the Neva. For its celebrations, however, the promised entertainment brought the crowds back to this draughty Soviet palace of culture, precisely to celebrate the fact that at Jungle, at least, time seems to stand still.


Indeed, you'd be forgiven for mistaking the pretty miserable venue for a youth club - albeit with a scattering of drag queens. While nominally gay, the dance floor is always packed with male/female couples, which lends the club even more surface innocence.

With a capacity crowd, more noticeably affluent and sadly ruder than the habitual one, the hour-long birthday show was enthusiastically received, combining lip-synched songs from Alla Pugacheva, Whitney Houston, Gloria Gayner and more sophisticated dance, jazz and cabaret numbers.

While most of the transvestite performers were not actually singing, there were exceptions such as Danil Kruglikov - the club's original host and also the only performer in male clothing. For 100 rubles, the show was a bargain, all the money being pumped into the outrageous costumes which included flower-pot hats and ball gowns that could be ripped off down to underwear in a second.

The young crowd of regulars appreciated the usual simplicity of the club but nevertheless enjoyed the special effort being made on the club's birthday. Natasha, an 18-year-old student, was suitably blunt. "I'll always come to Jungle - the place is a dump but the people who come here are great," she said. Her friend Stas, also 18, agreed. "This is my first time here. I usually hang out at Metro, Kontinent and La Plage. I've been to Greshniki before, but this is the best place I've been so far. There are so few gay clubs, people just aren't used to this kind of entertainment, but I loved the show. It's a real sign that Russia is becoming more open-minded."

As the show ended, all the performers, lead by host Maria de Estaflor, said emotional thank yous to the crowd, including such old favorites as Oleg Odoyevsky (whose tragic, alcoholic Pugacheva is frighteningly indistinguishable from the real Alla Borisovna), the alternative ballet group Bize-Lizu and - "real" woman (and minor superstar) - the enormous, leather-clad Gulia.

The crowd, perhaps remembering with some nostalgia the more intimate origins of St. Petersburg's "alternative" scene, danced the night away to terrible Russian pop music, and the place was still full when the management finally sent everyone home at 7 a.m.

TITLE: russian museum goes all out to promote modern artwork
AUTHOR: by Galina Stolyarova
TEXT: To live up to its status of Russia's cultural capital, St. Petersburg is currently promoting art projects from all over the country by unveiling new contemporary art.


And if you somehow missed three exhibitions of modern art put together by the Marat Gelman Gallery in Mos cow and now hosted by the Marble Palace of the State Russian Museum, now's your chance. After all, the Russian Museum is perhaps the only state-run art collection in the country seriously interested in revealing all different varieties of contemporary Russian art.

The three exhibitions are part of a larger project by Gelman entitled "Art Against Geography," celebrating the gallery's 10th anniversary, and are expected to tour all over Russia. The Russian Museum, where the tour actually kicks off, will be enjoying three more projects after it parts with the first three, introducing local audiences to feminist art and some peculiar social projects, such as new designs for money.

The Marble Palace's noble interiors - home to the "Ludwig Museum in the Russian Museum," a project offering works of non-conformist art of the Soviet period in an international context - are thus very fitting for Gelman's collection.

"With this exhibition, the Russian Museum shows its respect for the Marat Gelman Gallery," said Yevgenia Petrova, deputy director of the Russian Museum. "We can't ignore the impressive results they have achieved in assembling a versatile collection of modern Russian art."

The project helps you to discover, in particular, artists representing the so-called "South-Russian Wave," a trend brought to public attention thanks to the efforts of Gelman himself.

Stunning you with their size, the giant paintings of "South Russians" touch on eternal subjects, making a mesmerizing sight. A number of works - quite in line with postmodernist tradition - offer a new look at religious and Biblical themes. For instance, Oleg Golosy's 1988 take on "The Last Supper." The modern icons are full of torment and pain, rather than the peace and serene harmony that traditional religious art radiates.

Yury Solomko isn't happy with a mere canvas to host his art. The artist paints over geographical maps - the tile of Gelman's project's is thus embodied

Another exhibition called "Poor Art" (Bednoye Iskusstvo) shows art emerging from, or rather comprised of, garbage. The more civilized the society becomes, the more waste it produces, and the tremendous amount of garbage in the modern world doesn't pass unnoticed by designers.

In the future, the Russian Museum looks set to continue being a host for the country's private arts galleries, and new projects are promised to follow shortly. 



For further information, call the Marble Palace at: 312-90-54

TITLE: philharmonic invigorated under sinaisky's baton
AUTHOR: by Giulara Sadykh-zade
TEXT: Over the last week, St. Petersburg's Philharmonic has given up its stage to three very prominent conductors: Vasily Sinaisky, Rudolf Barshai and Alexander Lazerev. Two of them are Muscovites, while Barshai, founder of the first string chamber orchestra in Russia, has lived in Switzerland since 1977 and was invited to St. Petersburg by adviser to the governor Sergei Davitai.


Sinaisky's Saturday concert of Bartok, Beethoven and Weber convincingly demonstrated that the maestro is able, in the space of just a few days, to gain the trust and respect of the orchestra and also of notoriously hard-to-please St. Petersburg audiences.

Sinaisky, recently named head conductor and artistic director of the Russian State Orchestra, is back in St. Petersburg after a relatively long break. Sinaisky's conducting style has also recently undergone a positive transformation. Instead of effect-ridden superficiality, loud fanfares and a tendency to surface treatment, his work now features balanced interpretation, and an academic (in the best sense of the word), subtle construction of form.

At 50, it seems the maestro has come of age and can now use to the fullest the wealth of talent generously afforded him by nature - specifically, his conducting abilities. 

He first perfected these abilities under Professor Musin - and in 1973 at the prestigious conducting competition organized by the Herbert von Karajan Fund he was awarded the gold medal.

Now, after working with the best orchestras in the world, Sinaisky's own belief in himself and his abilities have been strengthened, and this is undoubtedly reflected in the qualities of his performances as well.

The concert opened with the romantic overture to Weber's opera "Oberon," performed by the orchestra in the best traditions of the Petersburg Philharmonic: lively, assured and bright but with the necessary measure of pathos and emotion. This was followed by Bartok's violin concerto, with Sergei Girshenko, first violin of the Petersburg Orchestra. His energetic and fervid interpretation was revealing of an especially academic approach and an extreme temperament, which lent Bartok's late opus a particularly sharp expression and dynamism. Melody ruled the concerto, an angular outline which in no way hid its unusual beauty.

The orchestra tactfully remained in the background, but came in with taciturn rejoinders, which both supported and added to the blossoming timbric voice of the violin. The mutual understanding of the soloist, conductor and orchestra was complete.

The performance of Beethoven's Seventh Symphony in the second half flowed from the undoubted triumph of the conductor. Measured tempos and the painstaking manner of execution were a joy to hear (especially given that recent performances of the symphony under Temirkanov have sounded rather devoid of content). Sinaisky's interpretation departed from habitual stereotypes, and yet this imported breath of fresh air and originality did not destroy the Philharmonic's complex academic traditions. Indeed, it seems that, for Sinaisky, the path to the international stage has just begun at the Philharmonic.

TITLE: kitsch master woos young and elderly
AUTHOR: by Barnaby Thompson
TEXT: The first time pop sensation Filipp Kirkorov appeared at the Eurovision Song Contest in 1995, it took some of those who were seeing him for the first time a few minutes to work out which side of the gender barrier this shaggy-haired, baby-faced apparition actually was on. Throughout much of the '90s, the king of kitsch of the former Eastern Bloc only got more outrageous and more wrapped up in his own ego, appearing as the Phantom of the Opera in New York, and writing groundbreaking songs like "Zaika Moya" that, while wildly popular, were hardly likely to tear down the walls of world music and drive Radiohead into retirement.


Kirkorov has brought his latest style to St. Petersburg for another marathon run at the Oktyabrsky Concert Hall - a leaner look (metaphorically speaking, anyway), no sideburns and more stubble. But it's merely cosmetic: There are as many firecrackers going off onstage as there ever were, as many dancers in PVC, as many glares and smirks that either send you into a frenzy of applause or scare the bejasus out of you and, of course, just as much of the bouncy, conservative and (what's the word? oh yes) appalling music.

But despite all this, Kirkorov is, unquestionably, a master - not a master in terms of composition, taste or dress sense (Val Doonican would have arrested Kirkorov's jacket for fashion crimes), but a master of entertainment. The man knows his audience, and he plays them like a flute.

When the show opens, the screen at the back of the stage confirms the old stereotype: images of Kirkorov on a thousand stages around the world, footage of him being greeted by a million adoring fans, and so on. Appearing out of nowhere with a couple of tame pyrotechnics and that cheesy grin, Kirkorov starts off with one or two hits that are, to the dispassionate ear, the same as so many others and instantly forgettable. It goes like that for about 20 minutes, the crowd strangely subdued, wanting to love their man but not quite able to do it.

But gradually, Kirkorov moves through the gears as he sings the swingy "Mokry Blyuz" song followed by a Sinatra-style number, a mournful ballad and a selection from his Spanish-language album, "Sueno d'Amore." The pitch rises, and with the timing of a true pro, Filipp (you're now on first-name terms) steps into the audience - not many people between the ages of 20 and 50 here, it must be said - to be bombarded with kisses and flowers.

Then comes one of those songs that goes "Booboobababadum" in the chorus, so that even the babushkas can sing along, and, lo and behold! Fil pulls one up on stage, hands her the microphone and away she goes. (There is real mastery at work here, too, if you watch closely. Our suspicion was that she was a plant, but who knows.)

And that's it: Fil has won. Enough foliage to open a flower shop, panties flying through the air, more costume changes - a triumph. Not to mention the fact there's no lip-synching, the band is live and the Kirkorov voice is in its usual, rafter-shaking form. You may not like the music, but you have to admire the show.



Filipp Kirkorov plays the Oktyabrsky until Dec. 1. Tickets cost from 150 to 600 rubles (about $5 to $20).

TITLE: chernov's choice
AUTHOR: by Sergey Chernov
TEXT: Two much-hyped shows by the band promoted as the Glenn Miller Orchestra at Mos cow's Kremlin Palace resulted in a scandal this week, as Moscow journalists discovered that it was not the "official" Miller tribute band from the U.S., but the obscure Glenn Miller Orchestra U.K. The letters "U.K." were wisely omitted by the promoters.


They also discovered that what was promised to be "the all-time greatest jazz show," with tickets costing between 300 and 6,000 rubles apiece, turned out to be, well, not that great.

Jazz critic Alexei Batashev, who wrote about the swindle at www.jazz.ru, reported that Russian jazz patriarch Oleg Lundstrem, who performed his own set of Glenn Miller's compositions last January, left during the break between sets.

"Not a bad restaurant orchestra," said Lundstrem, according to Batashev. "But they don't feel like Miller."

The band was supposed to play St. Petersburg on Dec. 6, according to the Oktyabrsky Concert Hall's newsletter. But now the concert is in question, as the hall's spokesman said Thursday the contract with the tour's local promoters has not yet been signed, which means that neither tickets nor posters have been printed. The decisive day for the show is Monday - no deal on Monday, no concert in December, he added.

Whatever will happen to the Miller show, St. Petersburg is getting ready to welcome the other "legends" - Creedence Clearwater, uh, Revived. Unlike Creedence Clearwater Revisited, which at least features the band's original bassist Stu Cook and drummer Doug "Cosmo" Clifford, Revived consists of various "exes," but none from the classic CCR. The most amusing fact is that vocal dues are taken by ex-Smokie Peter Burton, of all people. The musos will deliver John and Tom Fogerty classics at the Gigant Hall, the concert hall of Casino Conti, on Dec. 7.

We keep getting calls from various readers who want to come to Russia's one and only show by Tuxedomoon, who - unlike the aforementioned bands - do contain the principal members. Although the band seems to have a substantial cult following in Russia, the venue, St. Petersburg's Estrada Theater, only seats 400 - and 200 tickets were sold on the very first day, according to the promoter. He also said the venue's firemen demand everybody sit, and that they habitually stop the show when they see people standing, so no more than 400 people will be able to attend the show. But we've heard there were still some 800-ruble tickets available from the Titanic record store earlier this week. Nov. 27, 8 p.m.

Next week will also bring three anniversaries on the local club scene - of the underground Moloko, techno/pop PORT and pop/rock-oriented Internet cafe Planeta Internet (in order of appearance). Our favorite is still Moloko, which targets a student audience, and, though far from perfect and slightly claustrophobic, it's still one of the best places for creative types to hang out. Moloko, Nov. 29, 7 p.m.

TITLE: WORLD WATCH
TEXT: No Nuclear Sales

BEIJING (AP) - China has made its strongest commitment to date not to sell nuclear missile technology abroad, winning an immediate promise from Washington to forgo possibly bruising sanctions and to boost commercial space cooperation.

The deal between the two countries is aimed at curbing missile proliferation and should head off punitive legislation aimed at China in the U.S. Congress. 

China wins a reprieve from U.S. sanctions against Chinese companies suspected of transferring dangerous missile technology. The United States wins assurances that Pakistan, Iran and North Korea won't be benefiting from any new Chinese missile technology. 


Ex-Minister Killed

MADRID, Spain (Reuters) - Spaniards who had planned to celebrate 25 years of monarchy under King Juan Carlos on Wednesday instead mourned the killing of a former Socialist minister, blamed on the Basque separatist group ETA.

Former health minister Ernest Lluch, who expanded Spain's public health service in the early 1980s, was shot dead on Tuesday night in the garage of his apartment block.

He was the most prominent victim of a wave of killings that has now claimed 21 lives since ETA ended a truce last December.

The murder seemed timed to overshadow the 25th anniversary of the swearing-in of Juan Carlos. ETA considers the king the head of an "occupying" state and tried to kill him in 1995.


Bissau Fighting

BISSAU, Guinea-Bissau (Reuters) - Intense gunfire broke out on Thursday in the capital of Guinea-Bissau, where the head of the West African country's former military junta is seeking to regain control of the armed forces.

Automatic gunfire and the blasts of what sounded like rocket-propelled grenades could be heard on Thursday morning coming from a military camp in the center of Bissau.

The shooting followed clashes on Wednesday night between forces loyal to former junta leader Gen. Ansumane Mane and troops backing the man he said he was deposing, elected President Kumba Yalla, after disagreements over army promotions.


7 Die in Monsoon

KUALA LUMPUR, Malaysia (Reuters) - Floods in Malaysia caused by heavy monsoon rains have killed seven people and forced more than 4,500 to flee their homes, media reports said on Thursday.

A total of 2,500 people in five districts in Terengganu state in northeastern peninsular Malaysia had been evacuated from their homes since heavy rains began on Monday, the national Bernama news agency said.

In the neighboring state of Kelantan, floods forced at least 2,000 people to take shelter in community halls and schools, Bernama said. 


Child Labor

TEGUCIGALPA, Honduras (AP) - More than 40,000 children left school to work in Honduras' streets, fields and factories after Hurricane Mitch devastated the country in 1998, according to a UN report.

Honduras continues to suffer the toll of the hurricane - which left 5,657 people dead and caused billions of dollars in damage - in terms of lost opportunities for its young, according to the UNICEF report Wednesday.

"Thousands of families are forced to send their children to work in order to increase their meager family income," said Rossibel Garay, head of the Labor Ministry's Social Protection Office. "Many minors risk their lives, prostituting themselves, dealing drugs, collecting garbage, cutting wood, washing cars or making fireworks."


Dog Cops Get Bail

PRETORIA, South Africa (Reuters) - A South African court granted bail Wednesday to six white policemen alleged to have set dogs on three black job-seekers in a videotaped attack that sparked widespread outrage.

Outside the court, demonstrators shouted "one settler, one bullet" and demanded the policemen be jailed.

"The court could not find that it is in the interest of justice that bail be denied," magistrate Allan Cowan said, setting bail at $256.

The men left the court in three armored trucks and were to be released from the police stations where they have been held for two weeks since amateur video of their alleged assault on Mozambican job-seekers was screened by the public broadcaster.

The video shows five laughing white policemen repeatedly setting dogs onto three black men who scream and plead for mercy as the animals savage them.


Mobsters Freed

ROME (AP) - The Italian government moved Wednesday to stem public outcry over legal loopholes that have let a number of suspected mobsters walk free - including some who allegedly killed a 2-year-old girl after their release. 

Justice Minister Piero Fassino told reporters that the government, gearing up for an election campaign, was putting together new anti-mob measures. Prosecutors also denounced the releases, saying the men - most of whom had been in prison for more than three years while their cases wound through the courts - could now threaten witnesses, tamper with evidence or disappear. 

"Bosses go free, the government hurries to close the loophole," the Rome daily Il Messaggero wrote Wednesday. 


Editor Struck Off

ROME (AP) - The chief editor of a paper that published photos of children from a pedophile Web site, apparently to provoke public reaction against porno grap hy, was kicked out of a journalists' register on Tuesday. 

Vittorio Feltri "has seriously compromised his professional dignity" and his behavior was quite "incompatible" with the register's rules, said a statement by the Lombardy region's register. 

Feltri's paper, Libero, is based in Milan, Lombardy's capital. 

Libero published a list of convicted pedophiles in September, amid national outrage over the sexual assault and murder of two little girls. The paper gave the names, the sentence and a brief description of each of the 16 sexual offenders mentioned. The paper also published the photos of children on the web site. 

Feltri, who's known for being a conservative, provocative journalist, said at that time that "the people's conscience must be offended in order for them to rebel."

TITLE: Demonstrators Disrupt Hague Conference on Global Warming
AUTHOR: By Emma Ross
PUBLISHER: The Associated Press
TEXT: THE HAGUE, Netherlands - Demonstrators disrupted a major conference on global warming Wednesday with dozens of protesters staging a sit-in and a cake thrower targeting the top U.S. negotiator.


The uproar came as discussion at the UN climate conference focused on how to reduce global emissions of greenhouse gases, blamed by much of the scientific community for global warming.

Key contentious issues include how far countries should be able to use the carbon dioxide absorbed by forests and agricultural lands against emission reductions targets and to what extent nations should be able to buy their way into complying with their targets.

But the high-level talks were disrupted when several dozen environmental activists entered the high-security building, broke into a committee meeting and staged a sit-in. Conference President Jan Pronk said equipment was damaged and small fires were set in the building.

In an apparently unrelated incident, a woman pressed a chocolate cream cake into the face of the chief U.S. negotiator, Under Secretary of State Frank E. Loy, as the American delegation gave its daily press briefing. The woman then calmly walked out of the room.

A second woman then stood up on a chair and screamed at the delegates before being escorted out by a conference technician. Her words were indecipherable. Conference officials said the identity of the women were unknown.

"On the eve of Thanksgiving, pumpkin pie would have been a more traditional choice, but what I really want is a strong agreement to fight global warming. I'm headed back to the negotiating table right now with that aim," Loy said after the incident.

He then excused himself and the briefing was called off.

Environmental activists sitting outside the meeting room told The Associated Press they sneaked into the building to disrupt proceedings because they believed the goal of the meeting had betrayed the spirit of the 1997 Kyoto Protocol. The protocol committed developing countries to reducing their greenhouse gas emissions by 5.2 percent below 1990 levels.

The UN conference, which involves delegates from more than 180 countries, has two days left to decide how to reduce greenhouse gas emissions, in accordance with the Kyoto agreement.

They environmental activists said they were not connected with the women who disrupted Loy's briefing, nor with any environmental organization.

Dutch police said they had arrested around 100 protesters Wednesday near The Hague's central train station. The activists were planning to march to a number of embassies to protest against nuclear energy, but did not have a permit.

Protesters in the conference building said they believed the negotiations were watering down environmental protection.

Conferees are debating different ways that nations can use to meet their emission reductions targets.

TITLE: No End in Sight for U.S. Election Battle
AUTHOR: By Leigh Strope
PUBLISHER: The Associated Press
TEXT: The U.S. Election 2000 stretched into and beyond Thanksgiving Day without a president-elect, as the fierce tug of war between George W. Bush and Al Gore over Florida's crucial electoral votes finally reached the U.S. Supreme Court. 


Citing the risk of a constitutional crisis, Bush's lawyers asked the high court justices Wednesday night to block a decision by the Florida Supreme Court to allow hand counts in three Democratic-leaning Florida counties.

Without a decision by the Supreme Court before Dec. 18, when each state's electors cast the final vote on who next will occupy the White House, "the consequences may well include the ascension of a president of questionable legitimacy, or a constitutional crisis," the appeal said. 

It's an unpredictable, never-ending presidential race that just keeps getting more bizarre. 

"I heard someone compare it to a marathon," said Bush's spokeswoman, Karen Hughes. "You think there's a finish line and as you cross it someone says, 'Oh, by the way, it's not over."' 

While most Americans were feasting on turkey, paper ballot chads were again on the menu for Broward County election officials. They gave up their holiday to continue counting ballots before the Sunday deadline set by the Florida Supreme Court. 

Gore and Bush each planned Thanksgiving dinner with their families, in Washington and Texas, respectively. 

Bush holds a 930-vote lead in Florida, not counting the results of manual recounts initiated at Gore's behest in the three counties, where 1.7 million of the state's 6 million ballots were cast. 

Election workers in Palm Beach County took the holiday off and were to resume their count Friday. A Palm Beach County judge said officials must consider "dimpled chad" punchcard ballots - those that show an indentation but no perforation. 

But Judge Jorge Labarga said elections officials can reject the questionable ballots if the voters' intent can't be determined. Elections board chief Charles Burton said both sides would be able to make their cases Friday, but on first glance he didn't think the ruling would change the way his board has judged ballots. Gore wants the county to loosen its standards. 

Democrats planned an appeal to the Florida Supreme Court to force Miami-Dade County to resume counting after a three-judge lower court panel turned them down. The county's election board abruptly halted the count Wednesday, saying there was no way it could be completed by Sunday at 5 p.m. local time, the deadline set by the state Supreme Court. 

Away from the courts and counting rooms, GOP vice presidential candidate Dick Cheney was in a Washington hospital recovering from a "a very slight heart attack" - his fourth. He underwent surgery Wednesday to implant an artery-clearing device. 

"I can tell you they didn't find any pregnant chads," Cheney, 59, quipp ed on CNN's "Larry King Live" program. He said he hoped to be discharged from the hospital in "a day or two." 

Bush also filed suit in a Florida court asking 13 counties with heavy military populations to count overseas ballots. Hundreds of ballots were rejected last week when Democratic lawyers urged county boards to scrutinize them. Both sides believe Bush lost more votes than Gore in the rejected ballots. 

The Florida Supreme Court's decision Tuesday night directing Secretary of State Katherine Harris to include the results of the hand recounts in the state's certified vote totals has GOP lawmakers in both Tallahassee and Washington threatening challenges to Gore electors. 

Gore now has 267 electors pledged to him, Bush 246. Florida's 25 electors would give either the 270 majority needed to be declared the winner. 

Republicans, who hold majorities in both houses of Florida's legislature as well as in Congress, talked of convening to overturn the Florida court decision, which they noted was made by seven judges appointed by Democratic governors. 

Tom Feeney, Florida's new House speaker, was ready to "ensure an Electoral College representation for Florida" - though he also suggested on Thanksgiving eve that everyone "relax, take a deep breath for at least 24 hours." 

In Washington, House Majority Leader Dick Armey of Texas said Republicans in Congress were prepared to disqualify Florida's electors if the outcome of Florida's recount does not appear to be legitimate.

TITLE: EU Reminded That Balkans Still Flashpoint
PUBLISHER: Reuters
TEXT: ZAGREB, Croatia - The killing of Serb policemen, a bomb in Kosovo and warnings that Slobodan Milosevic may stage a comeback sent a sharp reminder to European Union leaders on Wednesday that the Balkans are still far from stable.


Two days before a historic summit in Za g reb to mark the rise of reformist governments in the region and chart out the path of their countries to future EU membership, the bloodshed underscored the ever-present risk of a return to conflict.

Four Serb policemen were believed killed in fighting on Tuesday with ethnic Albanian guerrillas who had infiltrated the security belt around United Nations-administered Kosovo.

They died in "widescale clashes which could grow into a real war," said Zoran Djindjic of the Serbian reform movement.

In Kosovo's capital, Pristina, a bomb attack early on Wednesday killed one Serb at the residence of Yugoslavia's chief representative in the territory.

With its ethnic Albanian population bent on breaking away from Serbia and 40,000 NATO-led troops deployed to keep the peace, Kosovo is the EU's biggest headache in the region.

The sensitivity of the issue prohibits any mention of Kosovo in the summit's upbeat draft communique and no Kosovars were invited to the meeting of leaders from Albania, Bosnia, Croatia, Macedonia, Slovenia and Yugoslavia with the 15 EU states.

The 21 heads of state and government were due to begin arriving on Thursday afternoon.

Some regional leaders were warning the EU ahead of the gathering not to assume that the replacement of hard-line nationalist Milosevic by reformist Yugoslav President Vojislav Kostunica presented a solution to all problems.

Croatian President Stipe Mesic said Kostunica's reformists must dismantle Milosevic's power bases quickly or risk his return to power.

"The fact that Milosevic recently appeared on Serbian television shows that he is not ready to accept defeat and wants to come back," Mesic told Reuters in an interview.

The scheduled appearance of Kostunica at the summit in the Croatian capital is seen as a welcomed symbol of rapprochement between Serbs and Croats, who fought a bitter war from 1991 to 1995. But they are by no means reconciled.

Prime Minister Ivica Racan said Croatia hoped Kostunica would pledge a clean break with the policies of Milosevic and apologize for Serbian aggression.

Croats understandably want to see a sign of Serb contrition, he said. But signals from Belgrade made clear that was unlikely.

Croatia and Bosnia also expect the West not to apply double standards to Kostunica on the question of cooperation with the International Criminal Tribunal for the former Yugoslavia.

They expect Kostunica to hand over Milosevic to The Hague court, where he stands indicted for war crimes. But again Belgrade has signaled that this issue is not a priority.

The EU is, of course, aware that there are still many obstacles to be overcome before democracy is stabilized in the region and NATO troops can go home. But it hopes the one-day summit will close a decade of political and economic misery.

"In return for a clear commitment to sustained reform, regional cooperation and respect for democratic standards and international obligations, the EU is offering these countries a road to Europe as potential candidates for membership," said an EU statement released on Wednesday.

The EU leaders will announce $3.92 billion in aid for reforms in the region from now until 2006, assess each country's progress, encourage further reforms and urge more regional cooperation via a relaxation of the existing trade regime. EU foreign policy chief Javier Solana on Wednesday issued his own reminder that the summit was a two-way street.

"We have the obligation to listen to what Mr. Kostunica has to say," he told a European Parliament committee. "Mr. Kostunica has also the obligation to listen carefully to what other leaders tell him."