SOURCE: The St. Petersburg Times
DATE: Issue #683 (50), Tuesday, July 3, 2001
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TITLE: Chirac, Putin Hold Troubled Summit
PUBLISHER: Combined Reports
TEXT: MOSCOW - The presidents of Russia and France said after Kremlin talks on Monday that they had almost identical positions on most issues, but differed openly on the future of Yugoslavia and separatist Chechnya.
Vladimir Putin and Jacques Chirac undertook their two-day meeting with a commitment to improve ties damaged by disputes over Russia's military campaign in Chechnya and legal rows.
Chirac said they had achieved "considerable convergence" on many issues and Putin said their views "almost coincided."
The two leaders issued a statement appealing against any moves to undermine existing international security arrangements, but carefully avoiding any mention of U.S. plans for an anti-missile shield.
But they were clearly uneasy with each other on key matters.
Putin challenged Chirac's praise of Slobodan Milosevic's handover to the International War Crimes Tribunal in The Hague despite the opposition of Yugoslav President Vojislav Kostunica. And he stoutly defended Russia's military drive in Chechnya.
Addressing a joint news conference in a sumptuous Kremlin hall, Chirac praised Milosevic's transfer as "the victory of right over violence, of democracy over tyranny, a moment of hope for justice and liberty throughout the world."
Putin's reply was blunt.
"We want the triumph of democracy, stability and predictability in this region. Does Milosevic's transfer to The Hague bring us any closer to these aims? I doubt it," he said.
"Do we not trust Kostunica and the country he leads? Do we want to destabilize this leader? Do we want to destabilize his country? I think the answer to all three questions must be 'No, no and no."
On Chechnya, Putin seized the microphone when a reporter asked Chirac whether France had abandoned attempts to influence Russia's behavior in its 20-month-old campaign in Chechnya.
"We are dealing with isolated attacks by separatists. The latest attacks are carried out by fighters who come from abroad, mostly mercenaries with large quantities of heroin," he said, drumming his fingers on the table.
"This is the sort of people we are waging an armed battle against and will continue to do so. I believe that if a group of mercenaries landed in southern France with similar aims, France would act in the same way. As for political issues, we will solve them by political means."
In reply, Chirac said he had not heard the question initially. He then said Putin had set out his position in talks.
"This came up naturally in conversation," he said. "I simply restated France's longstanding position that it was vital to do as much as possible to seek a political solution to the crisis."
The two leaders issued a statement on international strategic issues on Monday in which both France and Russia affirmed support for maintaining the ABM Treaty, which the United States has argued is outdated and stands in the way of President George W. Bush's proposals for a missile-defense system.
"Russia welcomes the readiness of the United States to reduce strategic offensive weapons,'' Putin said at the press conference with Chirac. "Our concrete proposal is that we are ready for a further controlled reduction to 1,500 warheads and even fewer, but I want to stress controlled.''
Putin also said any Russian reductions would be "closely linked to maintaining the ABM Treaty.'' Russia believes abandoning the treaty would destroy the international security balance, a position supported by France.
"We attach great importance to our statement of strategic stability,'' Putin said.
The chill in ties between Russia and France in recent years had relegated Chirac on Putin's list of European leaders with whom he sought to establish personal ties.
However, Putin and Chirac met in Paris last October. The warm welcome reserved for the French leader on a relaxed Sunday in St. Petersburg - Putin's home town - was intended to show that the improvement had been consolidated.
Putin also hosted British Prime Minister Tony Blair and German Chancellor Gerhard Schroeder in St. Petersburg earlier this year.
On arms control, a joint statement called for an international conference on rocket-technology transfers and said existing arms-control agreements should not be replaced by a "less constraining" arrangement.
Both sides have recently toned down their opposition to Bush's missile-defense scheme.
On Sunday, the presidents enjoyed a cultural program in St. Petersburg ahead of the Moscow talks aimed at strengthening their personal relationship.
In a gesture reserved for special guests, Russia's Vladimir Putin had invited Chirac to begin his three-day visit to Russia in this city built by Peter the Great as a chain linking Russia with Europe. It is Chirac's first trip to Russia since 1997.
On Sunday, the presidents held only one 15-minute meeting and reserved most of the time for a cultural program. According to the Interfax news agency, Putin and Chirac discussed the possibility of launching Russian Soyuz spaceships from France's Kourou space complex.
Interfax quoted Deputy Prime Minister Ilya Klebanov as saying that the issue could be further discussed at a meeting of EU space officials in November. He said Russia and France could form a joint venture to run the project if it was approved.
Kourou, situated in French Guiana on the northeast coast of South America, is much closer to the equator than Baikonur cosmodrome in Kazakhstan, which Russia uses for its space launches. The closer the pad is to the equator, the cheaper the launch.
Later on Sunday, Chirac visited the exhibition of prominent French abstractionist painter Pierre Soulage in the Hermitage Museum.
He was later joined by Putin for a concert in the Shostakovich Philharmonic with a carefully selected program of Tchaikovsky and Ravel.
Putin hosted a dinner for Chirac later in the day and the two leaders flew to Moscow late Sunday night.
In an interview with Russian journalists on Sunday, Chirac talked of the "paramount importance" of Russia's relationship with the European Union and France.
He also praised Russia's role as co-sponsor alongside the United States in the Middle East peace process, and said Russia and France shared the same approach to the problem.
Chirac spoke of the need for joint efforts to restore peace in Macedonia, which has been lurching toward civil war.
Chirac also praised the economic reforms under Putin's leadership that have helped the Russian economy recover since the 1998 crisis, adding that strengthening economic cooperation would have an important place in their talks.
In Moscow, Chirac plans to visit former Russian president Boris Yeltsin and then travel on to the Volga city of Samara.
- AP, Reuters
TITLE: City Announces Plans for Water-Taxi System
AUTHOR: By Oksana Boyko
PUBLISHER: Special to The St. Petersburg Times
TEXT: St. Petersburg will take a major step this summer toward proving that its nickname, the Venice of the North, is no mere poetic comparison. On Friday, Vice Governor Valery Malyshev announced plans by the City Administration to develop a system of municipal water taxis as an alternative to increasingly overcrowded roads.
The complete system of water taxis will be included in the next 10-year general development plan, but the first "official" boats will appear on St. Petersburg's rivers and canals before the end of the current navigation season.
The number of private boats soliciting riders on city waterways has increased steadily over the last few years. However, their prices are such that, for the most part, only foreign tourists or guests from Moscow are interested.
"Generally, we take groups - it is easier to find a dozen people with 150 rubles than one person with 1,500," said the young pilot of a boat called Konverk, who declined to give his name. "But if you have the money, I'll take you anywhere. Even to Kronshtadt."
He added, however, that many boatmen he knew would be interested in giving up this business to become official water taxis, specializing in taking people quickly from one place to another rather than conducting leisurely excursions.
According to the city office of the State Boat Inspectorate, there are from 3,000 to 5,000 private small boats currently plying the city's canals, although only 169 have official state licenses.
"These boats are often used as taxis, but the quality of service leaves much to be desired," said department head, Konstantin Pashinsky. "That's why Malyshev has asked us to develop this project."
The plan calls for 10 water-taxi routes to be operational by the tricentennial celebration in 2003, and for one or two lines to be opened by the end of this year.
According to Pashinsky, the main difficulty in setting up the program has been acquiring the boats. Initially, the city sought bids from local firms, but the prices were as high as $125,000 each.
"We are currently of two minds [about the situation]. We could buy Scandinavian boats that we think are better suited to our climate, or we could buy American boats," said Sergei Skorikov, general director of the commercial firm Komandor, which is participating in the project. Skorikov said that the program would initially be financed by a loan from a local bank.
"It is not an easy procedure, but I believe that we will celebrate our first boat trip this summer," Skorikov said.
Vitaly Zentsov, deputy chairman of the Urban Planning and Architecture Committee, thinks that the water taxis will be the first step toward a mature river-transport system.
"Our city has a unique geographical position and a highly developed delta. I think we should take the opportunity to revive our rivers and canals, especially since our roads are getting more and more jammed each year," Zentsov said. The City Administration reports that there are now more than 1 million private cars on St. Petersburg's roads, and that that figure will double over the next two to three years.
Zentsov points out that "25 to 30 years ago, many citizens went to work on river trams."
The Urban Planning and Architecture Committee is presently drawing up a general development plan for the city, which is to be adopted by May 2003. "The idea of developing river transport in St. Petersburg will certainly be included," said Zentsov.
TITLE: Arrest Warrant Out For Director of TV6
PUBLISHER: Combined Reports
TEXT: MOSCOW - Prosecutors have issued an arrest warrant for the head of TV6, the small television station that has served as a home-in-exile for journalists who fled NTV when it was taken over by Gazprom.
The Prosecutor General's Office said Friday that Arkady Patarkatsishvili, chairman of the board of Boris Berezovsky-owned TV6, was charged with helping an associate of Berezovsky's escape from custody.
Nikolai Glushkov, a former senior executive at Aeroflot, was accused in April of trying to flee a clinic where he was getting medical treatment while in custody on embezzlement charges. Glushkov's attorney said he was not trying to escape but was set up by security services.
The prosecutor general's statement accused Patarkatsishvili of organizing Glushkov's attempted escape. Patarkatsishvili, who has ignored numerous summons to appear for questioning in the case, is abroad.
Berezovsky, who also lives abroad, has declined to appear for questioning in the long-running probe into finances at Aeroflot.
Patarkatsishvili said he saw the arrest warrant as another chapter in the government's media crackdown. "Some time ago I decided to head the board of directors of TV6, and I had no illusions that the authorities would try to destroy the company, just as [they did] NTV," he was quoted as telling Interfax. "Immediately after the NTV team came over to TV6, a stream of lawsuits came down on the company, while company staff were blackmailed and threatened."
Patarkatsishvili did not respond to the prosecutor's office's allegations in his Interfax interview, but described himself as "a law-abiding citizen" and added, "I do not intend to break the law."
Citing unidentified sources, Kommersant reported Saturday that investigators have recordings of telephone conversations between men identified as Patarkatsishvili and the head of security at ORT television, Andrei Lugovoi, in which they apparently discussed Glushkov's escape. Lugovoi was arrested Thursday, the newspaper said.
His lawyer Andrei Borovkov said the defense is not taking the recordings seriously, in part because it is not clear they were made legally or are authentic, Kommersant reported.
In addition to Glushkov and Lugovoi, four others are in custody in the alleged escape attempt: two drivers for Glushkov and two guards at Lefortovo Prison.
Berezovsky hired more than 100 journalists and technical staff to work at TV6 in April after they left NTV to protest the takeover by state-controlled Gazprom. TV6 is a second-tier channel with only a fraction of the viewership of NTV and other big networks, but the NTV journalists have vowed to use it to rebuild an independent news operation.
Authorities have also placed pressure on TNT, another cable channel that has broadcast news shows by the former NTV journalists.
- WP, Reuters, SPT
TITLE: Apartment-Bombing Trial Ready To Begin
PUBLISHER: The Associated Press
TEXT: ROSTOV-NA-DONU, Southern Russia - Under heavy security, preliminary hearings opened Friday in the 1999 bombings of two Moscow apartment buildings that killed more than 200 people and helped prompt the government to send troops back into Chechnya.
Five men are charged in the bombings, though prosecutors say they are only part of a larger group that orchestrated the attacks.
At Friday's closed hearings in the southern city of Stavropol, judges decided that the full trial will begin July 3 in a regional court outside the city, said Alexander Velichko of the regional prosecutor's office.
Prosecutors would not identify which court, citing security reasons.
The trial will also be closed.
Security officials blamed Chechen rebels for the two Moscow blasts and two similar apartment explosions in the southern cities of Buinaksk and Volgodonsk, which killed a total of about 300 people in September 1999. Rebel leaders denied responsibility, and some claimed the security services staged the bombings to justify the offensive in Chechnya.
The blasts panicked the country, and followed the invasion of Dagestan by Chechnya-based rebels. The Kremlin cited both as reasons for sending troops to Chechnya, three years after the federal forces withdrew following the 1994-96 war with separatists.
Earlier this month, a court in southern Russia sentenced two men to life in prison for the Buinaksk bombing, which killed 64 people.
Four other defendants received lighter sentences for acting as accomplices in the attacks.
The four all pleaded not guilty. They were the first convictions in any of the bombings.
TITLE: Kursk Raising Ready To Begin
AUTHOR: By Vladimir Isachenkov
PUBLISHER: The Associated Press
TEXT: MOSCOW - The nuclear reactors aboard the sunken submarine Kursk are safe and will not jeopardize a Dutch company's effort to raise the sub from the Arctic seabed in September, Vice Admiral Mikhail Barskov, the navy's top official in the recovery effort, said Friday.
"Regular radiation monitoring has shown that the reactors are safe," said Barskov, deputy head of the navy.
He said ships from the Northern Fleet would keep track of radiation levels during the salvage effort run by Dutch company Mammoet. The operation will start around July 9 when 16 Russian and foreign divers are expected to arrive at the site in the Barents Sea. The divers will inspect the submarine and install equipment to haul the submarine to the surface around Sept. 15.
The Kursk sank Aug. 12 after two explosions in its forward weapons bay, the second of which was comparable to a small earthquake. Unexploded torpedoes remain, and Barskov said that a careful inspection would have to be done to ensure they pose no hazard to the salvage effort.
"Cutting of the bow will be done by robots, and no one will be working under water at that moment," Barskov said.
Mammoet formed a joint venture with Smit International, a Rotterdam-based maritime company that specializes in salvage operations. The companies plan to lift the Kursk using hydraulic lifting devices mounted on a giant barge.
Mammoet president Frans van Seumeren hailed the project as far more reliable than an earlier proposal made by an international consortium that Moscow rejected.
"We have solved all the technical problems," van Seumeren said.
Divers will cut 26 holes in the submarine's hull to anchor lifting cables connected to the hydraulic jacks on the barge. Mammoet said that its technology allows the crew to control precisely every inch of lifting, unlike the crane technology proposed by the consortium.
Barskov hailed the Mammoet project as the "best existing today."
After the Kursk is raised to the surface and put in huge clamps under the barge, it will be brought to the port of Murmansk and put in a dry dock, where the navy will remove its 22 Granit cruise missiles.
Barskov said the missiles, located in the midsection of the ship in containers as strong as the submarine's hull, pose no danger to the raising effort.
The Kursk's front section will be left on the seabed, and the navy is planning to raise at least some elements of it next year. It's too dangerous to try to raise the entire Kursk, because "the front section may break away and destabilize the raising."
The cause of the disaster, which killed all 118 crew, remains unknown. Barskov said officials hope to learn more after raising the Kursk, and also to recover more remains of the crew in addition to the 12 bodies raised during a salvage operation last fall. He said the bodies must be removed quickly once the Kursk is put in a dry dock to preserve them for identification.
Officials said the disaster had been triggered by a practice torpedo, but they remain unsure whether it had been caused by an internal malfunction in the torpedo - the theory favored by most outside experts - or a collision.
TITLE: Military Shake-Up Claims Army's Top Spokesperson
AUTHOR: By Valeria Korchagina
PUBLISHER: Staff Writer
TEXT: MOSCOW - President Vladimir Putin has sacked deputy chief of the General Staff Colonel-General Valery Manilov, bringing an end to the military career of the army's chief spokesperson.
Manilov was one of the armed forces' most public faces for nearly a decade. He was responsible for delivering the army's hardline rhetoric on both the 1994-96 and the ongoing military campaign in Chechnya.
In signing a decree firing Manilov on Friday, Putin officially dismissed the general for working beyond the age of mandatory retirement. Manilov turned 62 this year, while the official retirement age in the armed forces is 60.
But media reports suggested that the Kremlin had tired of Manilov's style of covering events in Chechnya. Manilov's statements on the military campaign were notorious for their inaccuracies and ill-hidden attempts to hush up what was really happening. His numbers for the federal forces' losses were often contradictory and far less than reality, while his numbers for killed and remaining rebels steadily grew, Gazeta.ru reported.
Additionally, Manilov became a laughingstock among some journalists, who joked that his statements were often not only peppered with falsehoods but also at times pure nonsense.
"There are no filtration camps in Chechnya," Kommersant on Saturday quoted Manilov as having said.
The newspaper also credited Manilov for saying: "The humanism of Russian officers and soldiers most fully shows in Chechnya. ... The whole campaign is filled with evidence of officers' and soldiers' humanism ... toward the civilians and captured rebels."
While Manilov's statements may have embarrassed the military, his dismissal also appears to indicate an ongoing reshuffle within the Defense Ministry under the command of new Defense Minister Sergei Ivanov.
Gazeta.ru said other top officers in the General Staff, including its head Anatoly Kvashnin, could lose their posts. Kvashnin recently lost face when his concept of military reform was rejected in favor of one proposed by Ivanov.
Manilov was the only officer of his rank to have hardly any experience in commanding the armed forces. Although a professional officer by education, Manilov chose a political career within the army.
He started out as reporter for a military newspaper in 1962 and in 1972 was named deputy editor of the Krasnaya Zvezda newspaper, the mouthpiece of the Soviet Defense Ministry at the time.
In the late 1970s, Manilov moved to the Defense Ministry's propaganda and information offices. He was appointed head of the offices in 1989.
After the collapse of the Soviet Union in 1991, Manilov managed to outlive his superiors by becoming a Defense Ministry spokesperson. In 1993, he was appointed deputy secretary of the president's Security Council. Then-Defense Minister Igor Rodionov named Manilov deputy head of the General Staff in 1996.
It was not immediately clear who would fill the post vacated by Manilov.
Manilov made no public statements about his dismissal. Interfax said he is being treated in a Moscow military hospital for an undisclosed illness.
TITLE: Visa Rules Could Boost Tourism
AUTHOR: By Valeria Korchagina
PUBLISHER: Staff Writer
TEXT: The cabinet gave the go-ahead on Thursday to amendments to visa rules that, if approved by parliament, would allow many tourists to visit Russia without visas.
The government's decision follows an appeal from the mayors of Moscow and St. Petersburg to allow tourists to obtain 72-hour visas upon arrival. Tour operators say eased rules would increase the flow of European tourists to Russia.
The changes approved by the cabinet on Thursday would allow the government unilaterally to decide to relax visa rules for countries of its choice if the decision could boost tourism while not harming national security, the government said in a statement.
Visitors may be allowed to enter Russia without visas in certain cases, such as tourists arriving on cruise ships. The cabinet noted at the meeting that such exceptions had been made in Soviet times.
Also, the amendments permit the government to scrap visa requirements for countries that decide to allow Russians to enter their territories without visas. Currently, such a decision can only be made via the signing of a special bilateral agreement between Russia and the other country.
Additionally, the residents of neighboring republics of the former Soviet Union and individuals without citizenship would be allowed to enter Russia without visas for humanitarian reasons. The government did not specify what constituted a humanitarian reason, but suggested that it included extreme circumstances such as an emergency.
The amendments will now be sent to the State Duma for its approval. The Federation Council must then pass the bills before Putin can sign them into law.
It was unclear on Thursday when the amendments will be heard by the Duma.
TITLE: Duma Gives Go-Ahead to Set of Judicial Reform Bills
AUTHOR: By Ana Uzelac
PUBLISHER: Staff Writer
TEXT: The State Duma gave preliminary approval Thursday to a set of bills aimed at reforming the judiciary system by putting higher professional demands on judges and making them more accountable to the public. The lawmakers also passed a new bill defining the status of defense lawyers.
The bills, introduced by President Vladimir Putin last month, passed with overwhelming majorities in spite of being criticized as repressive by liberal lawmakers, judges and lawyers.
The authors argued that with the promised financial support, the bills could modernize a system that is still functioning under the rules established during the Soviet era, almost four decades ago. The deputies seemed happy to wait to try to settle their differences before the second reading, planned for this fall, and all the bills gathered around 380 votes in the 450-seat Duma.
The presidential package consisted of three sets of amendments to the laws on the status of judges, the judicial system and the Constitutional Court, as well as new legislation on defense lawyers. It is part of a set of 15 bills that Dmitry Kozak, Putin's aide and the main engine of the judicial reform, is hoping the Duma will pass by the end of the year.
The bills approved on Thursday could significantly change the way judges are being named and dismissed and could potentially make the closed judicial community more accountable to the public and more tolerant of dissenting opinions within it.
The appointment of judges has been the prerogative of the Qualification Collegia - regulatory bodies that consisted solely of judges, and are notorious for their protectiveness of those who play by the established corporate rules and their intolerance for those who refuse to do so.
In one of the better-known cases, the Qualification Collegium of the Moscow City Court dismissed liberal Judge Sergei Pashin three times, the last time for "breaking the ethics code" by giving his office telephone number in a radio interview. All three decisions were later annulled. Pashin had turned his colleagues against him by criticizing their court rulings.
The bills foresee cracking open the collegia by bringing in other members of the legal community - professors and legal experts, for instance. They would make up one-third of collegia and would be appointed by regional legislative bodies. Judges also would have to improve their qualifications every three years.
While these provisions found no opponents in the Duma, the attempt to introduce an age limit for judges at 65 years encountered criticism from all sides. Some of the deputies wanted it removed altogether, others wanted it put up to 70, and still others down further to 60.
Equally controversial were provisions making it possible to punish judges for misdemeanors and for breaking rules governing their work and the work of the court. Some deputies argued that judges could "become the hostages of every single traffic policeman" who chooses to fine them for speeding or be dismissed after being late for work too many times.
But what drew the most criticism was a provision allowing for a judge to be arrested. Under current law, a judge cannot be held in any case. Under the proposed amendment, a judge can be arrested, but only if caught at the scene of the crime.
Yabloko Deputy Igor Artemyev argued that this would make judges easy targets for framing.
"We know how our police work. They plant a bag with narcotics on a judge, and there he is, caught at the scene of the crime," he said.
The presidential representative in the Duma, Alexander Kotenkov, said the bills' authors were ready to limit the cases where a judge can be detained to serious crimes.
The debate veered off course when political showman and nationalist Vladimir Zhirinovsky started saying that the main problem with the judiciary system is that it has too many female judges, who "don't understand the male mentality" and who are prone to handing out harsh sentences to the mostly male suspects.
"They just hear the word 'rape' and immediately put the man in prison for 15 years," he complained, saying that rape charges are often made up.
The only counterargument that the presidential representative came up with was that now with the government planning to raise salaries, being a judge will become a "highly respected profession" again and thus more men will become judges.
Kozak said that the government will invest 44 billion rubles ($1.5 billion) over the next four years into repairing crumbling court buildings and raising judges salaries. Salaries will be raised fivefold, from 6,000 rubles to 30,000 rubles, he said, and the number of judges will be doubled from 17,000 to 34,000.
The amendments of the Constitutional Court law are designed to set up a mechanism for implementing its decisions. Legislatures, which often ignore Constitutional Court decisions, would have six months to respond. Local legislatures that refuse to change laws that have been found unconstitutional or not in line with federal laws could be disbanded after two warnings.
Constitutional Court judges would be open to criminal prosecution only if the upper house of parliament, the Federation Council, agrees to it on the demand of the prosecutor general.
The fourth and most controversial project was the bill on the status of defense lawyers. Intended to guarantee lawyers' independence, it was criticized by the lawyers themselves as giving too much leverage to bureaucrats.
The bill gives the Justice Ministry the right to deprive a lawyer of his license. Even Kotenkov agreed this was "undemocratic and too harsh" and suggested this power be given to a court, Interfax reported.
The harshest criticism was reserved for a provision obliging lawyers to give free legal assistance to many categories of citizens, including World War II veterans and pensioners. The bill says the lawyers would be paid by the government, but gives no clear instructions for determining the level of remuneration.
"'Free of charge' for the client should not mean 'free of remuneration' for the lawyer," Genry Reznik, a well-known lawyer who participated in drafting the bill, complained in an interview with the Kommersant newspaper published Thursday. He said lawyers now get only 25 percent of the minimal wage, or 50 rubles, for a day of pro bono work.
But here as well, the deputies decided to resolve their differences in the second reading.
TITLE: Russians Conquer Final Mountain Frontier
AUTHOR: By Kevin O'Flynn
PUBLISHER: Staff Writer
TEXT: MOSCOW - Many tried and some died, but the world's only unconquered 8,000-meter-plus summit has finally been successfully tackled by a Russian expedition.
The 8,414-meter peak, Lhotse, fell to a team of Russian mountaineers in late May when nine members of the expedition reached the summit.
Lhotse is the fourth-highest mountain in the world and located just south of Mount Everest in Nepal. A mighty vertical ridge that never dips below 8,000 meters connects the two mountains.
"I have no doubts that the ascent is a long-awaited success for all Russian mountaineers," said Vladimir Shateyev, trainer of the national team.
"What these lads have done is a remarkable achievement that can be compared to a world record in any other sort of sport," he said in a statement.
Before the ascent, Russia had never been the first to ascend any mountain above 8,000 meters.
There is already talk of government awards for those involved.
Nikolai Chyorny, a 62-year-old and a veteran of five successful 8,000-meter mountains, helped choose the best of Russia's mountaineers for the trip. He did not climb up to the summit, but the 2 1/2 months he spent on the slopes of Lhotse have left him a ruddy dark brown.
He also has tufts of gray hair sticking out at odd angles after getting a haircut in Nepal. He was not alone - many supporters of the Nepalese king had their heads shaved as a sign of mourning for the royal family, which was massacred shortly after the Russians conquered the mountain.
A modest man with sparkling eyes and an appealing laugh, Chyorny is not particularly concerned with government awards, saying in an interview that he makes these trips for personal reasons.
"Nobody had ever been there," said Chyorny. "It was an honorable task."
Arriving in Nepal on March 17 the expedition flew with 4 tons of equipment to Lukla in the south of the country before moving up to the 5,300-meter-high base camp which, under the glacier Khumba, also serves as a base camp for Everest.
The group struggled through dangerous weather conditions - including one night when 30 centimeters of snow fell and temperatures fell to minus 22 degrees Celsius - to reach the peak two months later.
The first person to reach the summit was Alexei Bolotov on May 23. He was quickly followed by Pyotr Kuznetsov, Sergei Timofeyev and Yevgeny Vinogradsky.
"It was an amazing view," said Bolotov in an interview with Sport-Express. "Below 8,000 meters was a sea of clouds from which protruded only 8,000-meter-high [mountains]. ... It's impossible to describe the ocean of clouds and icebergs above them."
Over the next four days, five other mountaineers in the crew also reached the top.
As well as dealing with the risks of climbing, the expedition faced a national crisis when they came off the mountain. Nepal was in shock about murder of the king, the queen and seven members of the royal family, apparently by the crown prince.
Instead of the expected meeting with King Birendra after the successful summit, the expedition found itself stranded in Katmandu. The city was under curfew and the airport was closed.
There are 14 mountains higher than 8,000 meters in the world, and a total of 22 summits. The last time a peak was reached for the first time was 19 years ago, when a Japanese expedition made it to the top of the West Summit of K2.
Although there is a higher, 8,501-meter peak on Lhotse that was first conquered in 1956, until now Lhotse Middle has always thwarted mountaineers.
Russian mountaineers had attempted to climb the mountain five times before, with two attempts ending in tragedy. In 1997, expedition head Vladimir Bashkirov died on the way down from Lhotse after falling ill. Three years later, Vladimir Bondarev fell into a crevasse during an expedition organized by the Emergency Situations Ministry.
Asked if he would go back to reach the top himself one day, Chyorny quickly said no.
"I don't want to," said Chyorny. "There are more interesting other places that I've never been to."
TITLE: Sir Elton John To Do Royal Gig
AUTHOR: By Sam Charap
PUBLISHER: Special to The St. Petersburg Times
TEXT: In 1856, at the royal summer residence - the Catherine Palace in Tsarskoye Selo (now called Pushkin) - Johann Strauss Jr. made his first appearance before the Russian Imperial Court. The Viennese waltz master's Russian debut, where he conducted and played the violin, occasioned an exclusive ball in the best tsarist traditions, with only the cream of the Petersburg nobility, a few important cultural figures of the day and the royal family of Tsar Alexander II in attendance.
While Strauss came to town at the invitation of the tsar, the tables will be turned on July 19 when British pop legend Elton John will give a charity concert in the very same Catherine Palace. Members of his country's royalty will be tagging along as his guests.
Nonetheless, John is planning an event to rival the tsars in exclusivity and elegance. As Larisa Konoshonok of Alfa-Bank, which is organizing the concert, explained, there will be no tickets to the concert - only invitations. Those interested in obtaining one can do so via the Alfa-Bank Web site at www.alfabank.ru. The "suggested minimum donation" is a mere $1,500 - and just 300 invitations will be available at any price.
All proceeds from the concert will go to the restoration and construction of St. Petersburg's monuments, according to an Alfa-Bank press release. The bank has already announced plans to use some of the funds raised at the concert to build a monument to émigré poet and Nobel Prize laureate Joseph Brodsky.
In addition to local "invitees," John is expected to bring more than 100 guests with him, including British royalty, designer Giorgio Armani, and Prince Albert and Princess Stephanie of Monaco.
Alfa-Bank will also invite an unspecified selection of local administration officials, members of the Legislative Assembly, "major cultural figures" and high-ranking members of President Vladimir Putin's government.
John plans to give a 90-minute solo performance in the main hall of the palace. The concert will be followed by an auction, which will include some of John's legendary flamboyant costumes, and the proceeds of which will also benefit the city's monuments. Guests will then be treated to a fireworks display and a tour of the palace grounds.
In keeping with the imperial atmosphere, guests will be asked to dress formally in tuxedos and white evening gowns.
John himself chose the Catherine Palace for the concert, Konoshonok said. He visited the palace on his last trip to St. Petersburg in 1979, when he gave concerts here and in Moscow. John last visited Russia in 1995 when he gave a concert at the Kremlin Palace of Congresses in Moscow.
For those unable to attend the concert, John plans a live Web cast of the event, with the technical aspects being coordinated by the Microsoft Corporation. The Internet address has not yet been released, but information should be available on John's official site - www.eltonjohn.com - within the next week.
TITLE: IN BRIEF
TEXT: Anti-Nuke Protest
MOSCOW (AP) - Thirty Greenpeace activists were detained on Thursday for protesting on Red Square against legislation that would allow Russia to import spent nuclear fuel for processing and indefinite storage.
The legislation, which critics say would turn Russia into the world's nuclear dump, was approved by the State Duma earlier this month, despite broad public opposition.
On the eve of the parliamentary review, some 100 environmental activists from Greenpeace Russia gathered on Red Square to urge President Vladimir Putin to reject the bill.
Thirty activists were detained and held for four hours at a police station, before being told to show up in court the next morning, said Greenpeace Russia nuclear campaigner Ivan Bokov.
Import Plan Approved
MOSCOW (Reuters) - Plans to open Russia to imports of spent nuclear fuel got the go-ahead from the Federation Council on Friday, paving the way for President Vladimir Putin to enact the bill, which has been criticized by environmentalists.
The Federation Council was not required by law to vote on any of three bills forming the package, but the chamber's head, Yegor Stroyev, said Putin wanted to know its opinion on one bill dealing with the cleanup of contaminated areas.
If the council declines to debate a bill already passed by the State Duma, Putin has the right to sign it into law anyway. But RIA Novestei quoted Stroyev as saying Putin had told him he would only sign the bills once the chamber expressed its opinion on that particular document.
State Merger Bill
MOSCOW (AP) - The State Duma gave quick, near-unanimous approval on Thursday to a bill setting rules for incorporating foreign territory into Russia - a document that could pave the way for a proposed merger with neighboring Belarus.
The bill envisages that any agreement on Russia merging with a foreign state or absorbing foreign territory would need approval by the Constitutional Court. If the court approves, the agreement would need to be ratified by both houses of parliament and signed by the president.
Gazprom Stiffs NTV
MOSCOW (SPT) - Gazprom-controlled NTV television was forced Saturday to cancel its annual shareholders meeting after not enough shareholders showed up to make a quorum.
The NTV meeting was scheduled to take place at Gazprom's offices in Moscow, but no representatives from the natural-gas giant turned up, Interfax reported. Only two officials representing a 49.6 percent stake in the company controlled by Media-MOST arrived to participate in the meeting.
Media-MOST, which lost control of NTV to creditor Gazprom in April, accused the gas company of snubbing the shareholders meeting to avoid picking a new board of directors. Gazprom ousted Media-MOST's NTV management, including general director Yevgeny Kiselyov, from the television station at a controversial shareholders meeting it called in April.
Gazprom officials could not be reached for comment, and it remained unclear when another shareholders meeting would be scheduled.
U.S. Diplomats Gone
MOSCOW (Reuters) - The last of 50 U.S. diplomats slated to be expelled from Russia in a tit-for-tat spy scandal that erupted earlier this year have left the country, RIA Novestei reported on Saturday.
In March, Washington kicked out four Russian diplomats and said a further 46 should leave by July. Moscow immediately retaliated.
RIA quoted "well-informed sources in Moscow" as saying that the last of the 46 had already left the country. It was not clear when they had actually flown out.
Smoking-Ban Law
MOSCOW (AP) - The Federation Council has approved a bill that would ban smoking in many public places and put restrictions on images of smoking on television and in movies, Itar-Tass reported Saturday.
The bill, which was passed by the State Duma, prohibits smoking in the workplace, on public transportation and on flights of less than three hours, Itar-Tass said.
To become law, the bill must now be signed by President Vladimir Putin.
Images of people smoking would also be banned in movies and television programs unless smoking is an essential part of the action. In addition, the bill prohibits the sale of tobacco to people under 18 and sets standards for nicotine and tar content. The bill does not deal with tobacco advertising, which is regulated by other measures.
Party Bill Passed
MOSCOW (AP) - Lawmakers in the Federation Council swiftly approved a Kremlin-sponsored bill on Friday that would slash the number of political parties and increase their dependence on the government.
The bill passed in the 178-seat Federation Council on a vote of 110-3 with 10 abstentions. It won approval in the State Duma earlier last month. President Vladimir Putin must sign it for it to become law.
Spending on LAES
ST. PETERSBURG (SPT) - The Leningrad Region Atomic Energy Station, located in the town of Sosnovy Bor, will spend $220 million between the years of 2000 and 2004, Interfax reported on Thursday.
At an international conference on atomic-energy safety, the director of the station, Sergei Averyanov, explained that the funds, a large part of which will be provided by the station itself, will be used to modernize and rebuild the facility, as well as to ensure the safety of the second of its four aging nuclear generators.
TITLE: Kremlin Tightening Its Grip on Gazprom
AUTHOR: By Anna Raff
PUBLISHER: Staff Writer
TEXT: MOSCOW - The government grabbed control of Gazprom at the annual shareholders meeting Friday by securing a majority on the board of directors, a move that sets the stage for rapid and long-awaited reforms at the unwieldy gas giant.
Government officials won six out of the 11 seats on Gazprom's board. Three seats went to company management, while Burkhard Bergmann, vice president of Germany's Ruhrgas, kept his seat, as did Boris Fyodorov, the outspoken representative of minority shareholders.
The meeting also voted to effectively hand the government the power to fire the Gazprom chief executive, amending company bylaws to require only a simple board majority to force the CEO's departure. A unanimous board vote was previously required.
"Our future program will be directed toward ensuring the reliability of our gas supply and an increase in the efficiency of how we work," Gazprom CEO Alexei Miller told shareholders. "We have to take as much consideration as possible of our shareholders and partners. We must also see to it that our profits and capitalization increase."
Upon hearing those words, shareholders - especially foreign shareholders - heaved a small sigh of relief. Miller's remarks about his vision for Gazprom and his attitude toward shareholders signaled an about face from the attitude taken by Gazprom's previous leadership.
But despite the apparent strides forward, Fyodorov warned after the meeting, a lot of work remains to be done.
"We have come to a new level," he said. "It's not the end of the game. It's not the end of reform. This is only the beginning."
Gazprom local shares dropped 2.8 percent to close at $0.56 on a depressed market Friday. Its American Depository Receipts, or ADRs, which are traded on the London exchange, remained unchanged at $11.05. One ADR is equal to 10 local shares.
At the meeting, shareholders voted to pay a dividend of 30 kopeks per ordinary share - a total sum of about 7 billion rubles, or 15 percent of Gazprom's net profit. Gazprom paid out 10 kopeks per share for 1999.
Arngolt Bekker, the president of Gazprom shareholder Stroitransgaz, which is controlled by current and former Gazprom management and their families, withdrew his name from the list of board candidates on Thursday and, in his place, the shareholders elected Alexandra Levitskaya, first deputy head of the prime minister's administration.
Of the management team, former CEO Rem Vyakhirev, Gazfond pension fund president Viktor Tarasov and first deputy CEO Vyacheslav Sheremet each landed a board seat.
The government officials named to the board included Economic Development and Trade Minister German Gref, Anti-Monopoly Minister Ilya Yuzhanov, first deputy head of the Kremlin administration Dmitry Medvedev, Deputy Prime Minister Viktor Khristenko and Property Minister Farit Gazizullin.
Vyakhirev was recently ousted as CEO and replaced with Miller, a former colleague of President Vladimir Putin's who hails from St. Petersburg. Vyakhirev was appointed chairman of the board, a position that strips him of executive powers. Medvedev will be his deputy.
Although Gazprom's share price has doubled since Miller was installed on May 30, analysts said the real jump will be seen once the company is made more transparent.
"Further appreciation of the share price will depend on Mr. Miller's success in tacking the structural and financial porridge that is the sprawling nightmare of Gazprom," the Renaissance Capital brokerage said in a research note.
Miller spelled out on Friday a few of the numbers that investors have been scratching their heads over.
He said Gazprom was valued at $15 billion at the beginning of the year. In 2000, the value averaged $7.9 billion, 1.7 times more than the year before.
Gazprom's capitalization is low compared to other multinational oil and gas companies.
Gazprom has yet to release its 2000 financials audited to international accounting standards, but officials say this shouldn't differ greatly from results calculated under Russian accounting standards. Under those calculations, the company turned a net profit of 60.7 billion rubles ($2.1 billion) on revenues of 498.9 billion rubles.
"This year, Gazprom will make a profit according to international standards for the first time," said Andrei Nyupenko, deputy head of Gazprom's accounting department. "These financials are already ready, and Miller has already signed off on them."
Gazprom said the numbers will be released this month.
Investors are also waiting for the release of an audit conducted by PricewaterhouseCoopers of Gazprom's relationship with Itera, the seventh-largest gas producer in the world and competitor. Documents - which were published in The St. Petersburg Times and others newspapers - show that assets worth billions of dollars were transferred to Itera from Gazprom while Vyakhirev was CEO. Some of those assets went to Itera for a fraction of their value.
The PricewaterhouseCoopers report was to be released at the annual shareholders meeting but was inexplicably delayed.
However, according to Kommersant, the report will be incomplete because PwC didn't get access to enough information from Itera to make a full audit.
Kommersant said PwC had to send out letters to Gazprom's top managers asking for "written confirmation of unaffiliation" with Itera: 219 managers replied that they, indeed, were not affiliated with the private gas concern, and 19 failed to reply. Viktor Chernomyrdin, ambassador to Ukraine and former Gazprom CEO, was apparently one of the 19.
"There is much more evidence of asset-stripping than ever before," Fyodorov said. "This won't go away."
Gazprom has also guaranteed 5.5 billion rubles in loans to Itera, a company that Gazprom accountant Nyupenko called a reliable borrower.
"Itera is fulfilling all its obligations," he said.
"This is a big guarantee, but the credit doesn't worry anyone," said Sergei Dubinin, Gazprom's chief financial officer.
The shareholders meeting had been keenly anticipated by investors hoping that some control would be brought to Gazprom's finances. Now investors are looking forward to a Kremlin meeting on July 10 in which Putin is to be briefed on a liberalization plan for Gazprom shares. In March, Putin formed a working group to figure out how to merge the share markets. Local shares, which cannot be owned by foreigners, trade at half the price of ADRs, and investors have complained that this disparity is keeping the share price down.
Vyakhirev was greeted with enthusiastic applause when he was presented to shareholders as the next board chairman. But not all shareholders were pleased with the meeting.
Galina Kornitskaya, 65, angrily yelled at Gazprom officials through the company gates, where she said she was prevented from entering the meeting due to a lack of space.
"I came to register according to the directions sent to me, but the office closed half an hour earlier than scheduled," Kornitskaya said. "I came here early this morning, but they wouldn't let me in."
Kornitskaya, a retired geologist, said she and her son have held Gazprom stock since the company's first public auctions in 1996. She and a group of about 20 irate shareholders protested at the entrance.
"Tell Mr. Miller to come out here because I want to speak with him," she said. "This is a disgrace."
Facts and figures from Gazprom CEO Alexei Miller's speech to shareholders
In 2000, Gazprom:
TITLE: TNK Moves On Small Producer
AUTHOR: By Anna Raff
PUBLISHER: Staff Writer
TEXT: MOSCOW - Tyumen Oil Co. has deployed a team of armed security guards to secure a western Siberian oil complex claimed by a Canadian producer.
The Siberian complex belongs to Yugraneft, a small oil company with annual production of 350,000 tons a year. Norex Petroleum Ltd. - an oil services company - owns 60 percent of Yugraneft, but those shares were frozen late last month following a ruling handed down by the local arbitration court in Khanty-Mansiisk.
With Norex's shares frozen, Tyumen Oil-controlled Chernogorneft, which owns a part of Yugraneft, last week called an extraordinary meeting of Yugraneft shareholders to install their own general director at the helm.
The new director, however, has yet to receive any of the firms official documents or the official company stamp needed to start giving orders. Yugraneft's former general director, Ludmilla Kondrashinaya, said Friday the company premises had been cordoned off by Tyumen Oil, or TNK, guards.
"This isn't personal, this isn't commercial," said Norex chairman Alex Rotzang on Monday. "It's robbery. It's behavior typical of gangster capitalism. Russia's heralded dictatorship of the law doesn't exist."
In response, Rotzang threatened to sabotage any attempts by TNK to float securities on international markets. He says he has also enlisted the help of U.S. Senator Jesse Helms. Earlier this year, Helms criticized No. 1 LUKoil's "roguish behavior" in a letter to U.S. security officials.
This scandal is on the desk of Canadian Prime Minister Jean Chretien, Rotzang added.
"From what we can tell, it looks like an illegal confiscation of assets," said Graham Rush, the Canadian Embassy's minister-counselor for commercial affairs.
"It seems to have been based on a fraudulent shareholders' meeting. It looks like the use of force and the potential for violence. It's a major negative signal to Canadian and [other] foreign investors," Rush said in an interview with a Toronto-based newspaper, The Globe and Mail.
TNK is not taking any of these threats seriously, said TNK spokesman Dmitry Ivanov.
The begining of the struggle for Yugraneft took place in 1999, when TNK attained control of rival Sidanco's main production unit, Chernogorneft, during shady bankruptcy proceedings initiated against Sidanco played out in the same Khanty-Mansiisk court that froze Norex's shares in Yugraneft.
British Petroleum, which paid hundreds of millions of dollars for its stake in Sidanco, challenged the move and the ensuing war drew international attention. That conflict has yet to be resolved.
After the acquisition, TNK began to analyze Chernogorneft's holdings and found that the operator had a stake in Yugraneft, 85 kilometers north of the city Nizhnevartovsk.
"We discovered that Yugraneft was being run as if it was completely owned by Norex," Ivanov said. "We approached Norex. They didn't want to work with us. We took action." TNK says it owns 40 percent of Yugraneft; Norex says TNK owns 2.36 percent.
The court decision that was sought by and granted to TNK involves $5.8 million worth of know-how Norex used to buy into Yugraneft in 1992. TNK claims that this "know-how" consisted only of instructions on how to wash cars and feed oil workers, and asked Judge Valery Bersenyov to freeze Norex's shares and voting power in Yugraneft.
Rotzang counters that in 1993 Norex sent 173 railroad cars of equipment, adding that the last time Russia received such a shipment was during World War II.
Bersenyov granted TNK's petition, and an expert commission to evaluate Norex's charter capital contribution was supposed to be formed Saturday.
Bersenyov declined to explain why he froze Norex's voting rights, which allowed TNK to call the shareholders meeting and take over.
TITLE: Arbitration Court Orders Return of Samson Assets
AUTHOR: By Simon Ostrovsky
PUBLISHER: Staff Writer
TEXT: The St. Petersburg and Leningrad Oblast Arbitration Court on Friday ordered that assets transferred by the city's Samson food-processing concern to daughter companies in a reorganization carried out in the fall of 2000 be returned to the parent.
In a decision which the Moskovsky Industrialny Bank (MIB), which has a stake in the daughter companies, promises to appeal, the court agreed with arguments made by the Federal Service for Financial Restructuring and Bankruptcy, or FSFO, that some aspects of the division of the firm were illegal.
Alexander Utevsky, St. Petersburg FSFO head, said that the suit was filed due to the fact that, while the assets of the enterprise were transferred to its affiliates, the rights of creditors were being contravened, as the majority of Samson's debts remained with the parent firm.
"We conducted an investigation into the company last summer, and suspect that the split may have been part of a plan by the parent company to itself declare bankrupt," Utevsky said.
The hearing was the second time the two sides - the FSFO and MIB - had appeared in the court over the issue. On June 14 the court postponed making a final decision, citing a lack of necessary documentation on the part of both sides.
In particular, the court requested that the sides produce a promissory note for $145,000, which the daughter firms and MIB maintain was given to Samson in exchange for the transferred assets.
MIB and the daughter companies were unable again to produce the document on Friday.
"In our opinion, such a document never existed, and even if it had, it is void because it would have been signed without the shareholders approval." said Utevsky.
Officials at the FSFO maintain that the value of the assets transferred is more in the area of $10 million.
MIB stepped in to invest in Samson early last year after the company hit hard times. Samson sold 12 percent of its shares to the bank in the deal.
MIB was also a force behind the plan to split the company into smaller components, ostensibly for the reason that specialization would allow them to be more competitive.
Utevsky said that the FSFO is pleased with the decision but expects that it will be appealed.
This was confirmed by the MIB's head of investment, Dmitry Dobrin, on Monday. "We want the appellate court to review the decision," he said.
There is a 30-day period for filing appeals.
If an appeal is unsuccessful, or is not filed, all of the assets of the seven daughter firms will have to be transferred back under Samson's legal control.
The FSFO, which last year installed an external manager, Andrei Gulyayev, to act as general director, says that, should appeals fail, the organization plans to move to restore the company's liquidity and sell it off to investors in order to repay Samson's creditors.
Samson owes a total of $15.5 million to about 600 creditors, including the State Customs Committee ($6 million), International Moscow Bank ($4 million) and Gausepohe Fleisch GmbH, a company which imports meat from Germany ($2.6 million).
TITLE: RusAl Hires Former Finance Minister
PUBLISHER: Combined Reports
TEXT: MOSCOW - Russian Aluminum, the top domestic aluminum producer and No. 2 in the world, said Monday it had hired former deputy prime minister Alexander Livshits as deputy chief executive.
An economist, who was also a finance minister under former President Boris Yeltsin, Livshits will head up international activities and special projects for Russian Aluminum, or RusAl, the company said in a statement.
"A work scope like this won't give you a chance to get bored," Livshits said.
"I am convinced his work in the new position will contribute to an increase in the company's prestige in business circles both in Russia and beyond," the statement quoted CEO Oleg Deripaska as saying.
Deripaska added that the main aim of the nomination was "to achieve a qualitative breakthrough in implementing the company's global ambitions in all areas of its business."
Deripaska said that he would supervise RusAl's exports, which account for 80 percent of the company's production, as well as project financing. "In fact such projects are not simply financial - I would call them financial and political projects. Taking into account the scope of the company ... there is no bypassing the political aspect," he said.
The "political aspect" is likely to include improving the company's tarnished image abroad. The prestigious World Economic Forum in Davos, Switzerland, revoked Deripaska's invitation to its annual meeting earlier this year, citing a $2.7 billion lawsuit filed against RusAl in the United States.
That lawsuit, initiated by Mikhail Zhivilo, former head of a major RusAl production unit, accuses Deripaska and other officials of offering bribes, racketeering and murder.
Moscow-based brokerage United Financial Group said in a research note Monday that the company had to do a lot more than hiring Livshits to improve its image.
"We believe that [RusAl's] current charm offensive is mostly aimed at repairing the company's reputation - which still leaves much to be desired," UFG said. "Investors should not be overly optimistic about the chances of the company entering the capital markets soon: The current owners do not have significant incentives to consider such an option."
- SPT, Vedomosti, Reuters
TITLE: Russia To Enter Global Aviation Market
AUTHOR: By Lyuba Pronina
PUBLISHER: Staff Writer
TEXT: MOSCOW - The European aerospace community welcomed Russia onto the global market Monday as the European Aeronautic Defense and Space Co. sealed a 2.1 billion euro ($1.8 billion) deal with the Russian Aviation and Space Agency outsourcing parts for civilian and military aircraft and space technologies.
With presidents Vladimir Putin and Jacques Chirac looking on, the head of the European side, Philippe Camus, signed the agreement with Rosaviakosmos chief Yury Koptev in a marbled hall in the Kremlin.
"No market is now closed to the Russian product," said Camus, the chief executive of EADS. "We welcome Russian industry as an equal, global partner. ... This new partnership will allow both EADS and Russia to be even more successful in the world market."
The deal signed Monday includes a spectrum of contracts for Russia to build parts for satellite navigation, military transport aircraft, jumbo civil airliners, helicopters and to make upgrades for Soviet-made combat aircraft. Industry players said the deal will not only keep the lagging Russian industry afloat but help it move into international markets.
EADS comprises Germany's DaimlerChrysler Aerospace, Spain's CASA and Aerospatiale Matra of France. Rosaviakosmos represents all Russian space and aircraft producers, including the makers of Tupolev and Ilyushin passenger jets and Sukhoi and MiG fighters.
Following the agreement Monday, EADS and Rosaviakosmos will set up joint companies to manage the cooperation programs. In Russia, the contracts are expected to create thousands of highly qualified jobs and bring in 2.1 billion euros over 10 years.
Neither side elaborated on the scope of the investment, saying that exact allocations will be determined during negotiations on concrete contracts with Russian enterprises.
Camus said Russia's participation could be further increased if the projects agreed to Monday take off successfully.
Both sides said the contracts to supply parts, undertake joint design and scientific research and make joint satellite launches is but the first stage in long-term cooperation.
"It's the way Airbus is working: the front part [comes] from France, the tail from Spain and the wings from the U.K. We are proposing that Russian industry plays its role [in production] like in an orchestra," Camus said.
Russian plants will manufacture fuselage sections for every second Airbus A-320 passenger jet, or 150 sections a year. They will also make fuselage units for A330/340 aircraft.
Bergner said that public tenders among Russian manufacturers will be held to supply parts, he however did not specify dates.
Russia's participation in building the double-decker A-380 super jumbo jet has been scaled down since first talks were held on the project in 1997, when Russia was offered a risk-sharing agreement. Airbus has been cooperating closely with the TsAGI research institute and the Tupolev Aviation Scientific Technical Complex and production plant Aviastar in Ulyanovsk on building the double-decker A-380 super jumbo jet.
Russia will also join production of yet-to-be-designed new A-400M military transport aircraft that was picked by European countries over the Russian-Ukrainian An-70. They will supply landing gear and engine mounts.
On the military side, EADS will further assist in the joint development of the Russian-designed Mi-38 transport helicopter and help upgrade the Soviet-built MiG-29 combat aircraft. Twenty MiG-29s are used in Germany and over a hundred in central and eastern Europe.
Klaus-Dieter Bergner, EADS senior vice president for Central and Eastern Europe, said that along with taking parts, EADS will help Russian companies win much-sought and expensive European certification for their products.
The EADS-Russia space programs include further work on Soyuz booster rockets for the commercial launch of Western satellites. About 10 such launches have been made so far. EADS said it supported a Russian proposal to launch Soyuz rockets from the Kourou launch site in French Guyana.
Camus said that Soyuz would complement, not rival, the European-built Ariane-5 booster because the Russian rocket is in a smaller category.
Camus said that a final decision for Kourou launches will be made by European Space Agency when it meets in November.
"If the decision is positive, the first launch could be in 2005," he said.
Monday's agreement also embraces Russian participation in a new European navigation system, Galileo, by subcontracting design work. The European Union earlier decided not to use Russia's Glonass satellite navigation system.
Camus said the agreement will create thousands of jobs in Russia's aerospace sector. EADS itself plans to set up an engineering center here with 150 engineers, he said.
The agreement comes two months after Russia and Boeing Co. of the United States signed a deal to cooperate on space modules, satellite launches and the building of a new airliner. No dollar figures were assigned to the pact.
"The fact that leading European and American aerospace companies are beginning to work with Russia gives income and employment to an industry that wants both badly," said Paul Duffy, a Moscow-based aviation analyst.
"The standard of Russian research facilities is very high indeed, and that means that Western companies can benefit from Russia's experience in research," he said.
Russia's space and aviation plants are operating under full capacity. The military isn't placing orders and foreign deals are trickling in. Russia's airlines can ill afford to pay full price for aircraft and opt to keep on flying Soviet-built planes or lease foreign ones. Only four passenger planes were delivered last year.
TITLE: Rostelecom Elects New Directors
PUBLISHER: The St. Petersburg Times
TEXT: MOSCOW - Rostelecom shareholders voted in a new board of directors at their annual meeting Saturday, leaving only one minority representative and one from the company itself.
Seven of 11 places were filled by representatives of Svyazinvest, the state telecoms holding that owns 51 percent of Rostelecom. Shareholders also approved dividends for 2000 of 16 kopeks for ordinary shares and 42 kopeks for preferred shares.
Sergei Kuznetsov was confirmed as general director. He had been acting general director since February, when Nikolai Korolyov resigned citing health reasons. Korolyov was voted to the board.
Minority shareholders' representatives lost one of their two seats, as Millennium Fund's Ulf Persson did not receive repeat confirmation. The sole minority shareholders' representative, Grigory Finger, head of the Moscow office of New Century Holdings, said he could not blame Svyazinvest or Rostelecom management, but rather low turnout from outside investors.
In his first comments to the press since coming on board more than four months ago, Kuznetsov laid out general tasks for the year ahead, including increasing Rostelecom's share price, cutting expenses and making the company more client-oriented.
TITLE: IN BRIEF
TEXT: Aeroflot Buys Software
MOSCOW (SPT) - Aeroflot on Friday signed a five-year agreement with U.S. Sabre Holdings Corp. that will provide the airline with $10 million worth of software products.
Aeroflot will use the software for revenue management, pricing, network management, scheduling and operations and hopes to reduce operational costs.
Installation will take nine to 12 months, but after that the software will make up for its cost within a year, Aeroflot deputy general director Nikolai Yegorov said. He added that using such software would earn airlines an extra 4 percent to 5 percent on top of annual turnover. Last year, Aeroflot posted a revenue of more than $1 billion.
Alrosa Profit Falls
MOSCOW (SPT) - Diamond monopoly Alrosa said Monday its 2000 net profit fell 8.3 percent last year to 9.9 billion rubles ($340 million) as worldwide sales of diamond jewelry declined, the Dow Jones news wire reported
"Rough-diamond extraction around the world is growing faster than consumption of diamond jewelry," said Valery Rudakov in statement. Rudakov is head of Gokhran, the state depositary for precious metals, and co-chairman of Alrosa's supervisory board.
Difficult market conditions increase the likelihood of Russia renewing a trade agreement with De Beers United Mines under which Alrosa sells 98 percent of rough diamonds to De Beers. The accord runs out at the end of the year.
Earlier this year, Rudakov said he "did not exclude the possibility of Russia not signing a new trade agreement with De Beers at all."
However, officials seem to have since changed their minds. "Any hard competition in such difficult market circumstances will be harmful," Rudakov said in a statement Monday.
New Tupolev Designed
MOSCOW (Reuters) - The Tupolev aircraft design bureau said Monday the first of its new 35-ton capacity Tu-330 cargo planes would roll off the assembly line in 2003.
"We have completed design and development of the aircraft, and the Kazan aviation plant is now making preparations to start serial production," said Yevgeny Alyoshin, assistant to Tu-330 chief designer Valentin Bliznyuk.
The plane, which has a flight range of approximately 3,000 kilometers, is one of a new generation of domestically produced cargo aircraft that will meet tighter U.S. and European noise and environmental standards.
Ruble Hits New Low
MOSCOW (Reuters) - The ruble tumbled to a fresh low Monday as pressure from government plans to cut exporter's obligatory dollar sales coupled with traditional weakness at the start of the month, dealers said.
The ruble's weighted average for today settlement fell to 29.1588 per dollar in a unified session of eight exchanges after 29.0651 per dollar Friday.
Based as usual on the results of the unified session, the central bank cut its official next-day rate to 29.16 rubles per dollar after the previous 29.07 rubles.
"Market demand [for the dollar] is slightly up against the backdrop of a rise in [banks'] balances and the announcement of a cut in obligatory sales," one dealer said.
President Vladimir Putin ordered the government Friday to work out a bill to cut obligatory sales of hard-currency revenue by exporters to 50 percent from the current 75 percent.
TITLE: EU Grows As Factor in U.S. Merger
Proceedings
AUTHOR: By Paul Geitner
PUBLISHER: The Associated Press
TEXT: BRUSSELS, Belgium - General Electric Co. chief executive Jack Welch was not the only influential American who seemed taken aback by the European Union's threat to block GE's $41 billion purchase of Honeywell International Inc.
U.S. senators accused EU regulators of protectionism and warned of a possible "chilling effect" on trans-Atlantic relations. Even U.S. President George Bush expressed concern about the deal's rejection, which could come as early as Tuesday.
Yet while politicians complain, American companies have been turning to Europe for years to intervene in American mergers, in part because its antitrust machinery grants a greater voice to competitors.
After failing to convince U.S. antitrust officials to kill the deal, two Honeywell rivals, Rockwell International and United Technologies Corp., lobbied the EU at a closed hearing in late May.
They complained that combining the financial power of GE's leasing arm, GE Capital Aviation Services, with market dominance in jet engines and avionics could drive others out of business, leading to higher prices for customers.
"The European Union listened," said Don McGrath, a spokesperson for Milwaukee-based Rockwell. "The U.S. Justice Department didn't ask our opinion."
It was hardly the first example of a U.S. company going to Brussels to complain. Back in 1981, R.J. Reynolds complained about Philip Morris taking a stake in a third competitor. Disney pushed for concessions by America Online when it took over Time Warner last year. The European Commission has opened investigations into Intel and Microsoft based on allegations made by Advanced Micro Devices, a chipmaker, and computer maker Sun Microsystems.
The EU is more willing to try to make sure that rival businesses aren't shut out from a market, antitrust experts say. Some tie the regulatory differences to the nature of the EU, a collection of 15 sovereign countries trying to create a level playing field for companies in a newly unified market.
America, on the other hand, "has already got a common market," said Michael Reynolds, former chairman of the antitrust committee of the International Bar Association.
Competition Commissioner Mario Monti notes that the two sides of the Atlantic usually reach the same decision, a tribute to daily contacts and close cooperation between the agencies.
Of nearly 400 cases involving U.S. companies reviewed in Brussels since 1990, only one deal - WorldCom-Sprint - was barred. And Washington moved to block it the next day.
To try to head off divergent results, Monti is leading an effort to create a global forum to improve coordination among antitrust agencies springing up worldwide. Meanwhile, U.S. companies seeking to merge are going to have to add Brussels to their radar screens.
"It used to be you submitted your deal in Washington and you could count on the influence of the U.S. government to carry you through wherever else you needed clearance," Watkins said. "Now you've got this quite powerful centralized EU regulator, and they're making it very clear they cannot be ignored."
TITLE: Japanese Executives Losing Faith in Economy's Future
PUBLISHER: The Associated Press
TEXT: TOKYO - Business sentiment in Japan worsened in the second quarter, as companies hit by weakening demand for their products in overseas markets and plunging profits continued to pare spending, a central-bank survey showed on Monday.
The Bank of Japan's survey revealed that business confidence among executives at large Japanese manufacturers was minus-16 in the April-June quarter, down from minus-five in the previous three months.
It was the second-straight quarter that the survey's key indicator was negative - meaning big-business officials who are skeptical that the economy will emerge from its worst postwar slowdown outnumbered those who think the economy will rebound. Sentiment is expected to improve slightly to minus-14 in the July-September period, the survey showed.
The decline in the January-March period was the first in four quarters.
Analysts had expected the continuing stock-market slump and signs of stagnant growth to dampen company executives' mood. The large manufacturers index was in line with the minus-18 forecast by economists surveyed by Dow Jones Newswires.
The survey reflects worries that the slowdown in the United States and Europe may force consumers there to slow their purchases of Japanese products, depriving companies of a major source of profits. It also shows concerns that weak stock prices are hurting business prospects at home, forcing some companies to cut jobs and investment in new equipment.
The index for non-manufacturers was negative but unchanged from the previous quarter. But the small-companies indicator dropped further into negative territory, showing that the smallest businesses, which employ the majority of the country's workers, are suffering the most despite government efforts to prop up the sector with public funds.
The biggest manufacturers said they plan this fiscal year to increase spending on new machines, computers and other technology - a key driver of growth.
TITLE: IN BRIEF
TEXT: Electronic Alliance
TOKYO (AP) - Sharp Corp. and Sanyo Electric Co. said Monday they will form a global alliance in consumer electronics, in the latest sign that industry reorganization is accelerating.
The companies, both based in Japan's second-largest city of Osaka in western Japan, said they will conduct joint research and development, as well as original equipment manufacturing, for refrigerators, microwave ovens and washing machines.
In May, Matsushita Electric Industrial Co. and Hitachi Ltd. announced a similar alliance in information services and consumer electronics, including research and development.
Japanese manufacturers face increasing price competition in the domestic home-appliances market.
Dropping a Deal
NEW YORK (AP) - United Airlines is abandoning its $4.3 billion purchase of US Airways because it is convinced the merger won't win regulatory approval, published reports said.
United informed US Airways Friday that it wants to discuss terminating their agreement before Aug. 1, the first day either side can alter the deal, The New York Times and USA Today reported in Monday's editions, citing sources familiar with the discussion.
United, the country's second-largest airline, will have to pay US Airways a $50 million breakup fee if it ends the agreement after Aug. 1. Before that date, the breakup fee is substantially higher, but United is asking to pay only $50 million. Representatives for both airlines declined to comment on Sunday.
OPEC Standing Pat
VIENNA (Reuters) - OPEC on Monday prepared to leave oil supplies unchanged in the shadow of a global economic downturn that is eating into petroleum demand.
Ministers from the Organization of the Petroleum Exporting Countries, meeting on Tuesday, said they see no need to lift output despite the prospect that UN-supervised Iraqi exports could remain on hold.
OPEC's July 3 conference is timed to coincide with a vote at the United Nations on revised sanctions against Iraq that will influence the fate for months to come of substantial Iraqi supplies.
TITLE: Beware Court Rulings on Tax
AUTHOR: By Ruslan Vasutin
and Andrei Sergeyev
TEXT: "Forgot how good your life is? Don't worry, the tax inspector will remind you."
This post-Soviet era saying has real resonance in Russia. As tax bodies are pressured to raise more revenues, law-abiding taxpayers are often the hardest hit. Indeed, the authorities find it easier to collect taxes from law-abiding firms than to chase sub-economy firms with sophisticated tax-evasion schemes.
As the pressure on diligent, "easy target" taxpayers grows, so do the methods used by tax inspectors to collect these taxes. One of the latest favorites is retroactively applying recent court rulings to tax audits of previous years. In other words, filing practices that you believe to be clear and legal at present may in two years' time be alleged to be tax violations if subsequent court decisions change the reading of the law.
A recent example of such retroactive application of court-established practice may be found in the large number of recent audits of taxpayers who received hard-currency loans in 1998 and 1999. The tax inspectors' sudden interest in this question stems from a decision of the North-West Arbitration Court earlier this year, where the court ruled that foreign-exchange losses arising from revaluation of hard-currency loans are not considered to be tax deductible until the taxpayer settles the loan. This position is contrary to that adopted by most taxpayers and consultants. Thus, if the loan term exceeds one year, a borrower may pay profit tax (29 percent in St.Petersburg) on the foreign-exchange loss (or negative hard-currency difference) to the extent that the previously deducted loss creates additional taxable profit.
The authorities are showing alacrity in adopting their auditing procedures to favorable court decisions. And they are applying these procedures not only to 2000 tax audits, but also retroactively to audits of 1998 and 1999 filings.
It should be mentioned that, although court decisions are shaping tax practice in Russia, they are not considered as sources of law. This means that court decisions do not represent precedents and are only binding for the parties involved. Therefore, it is not unusual for two court decisions to represent opposite rulings on the same question. From a practical standpoint, it may become crucial to consider all details of the obtainment of a loan in order to determine the applicability of a court case to a specific taxpayer's situation. This will help to select the most effective approaches for the taxpayer before a tax audit and potentially reduce the amount of tax penalties incurred.
As another old saying goes: "Experience comes with debts." Hard-currency debts are not an exception here.
Ruslan Vasutin is legal manager and Andrei Sergeyev an associate at Andersen Legal's St. Petersburg office.
TITLE: Lost Values of Reform
AUTHOR: By Sergei Pashin
TEXT: JUDICIAL reform has finally ceased to be the private business of a few enthusiasts and has now been declared a state priority. As a result, the reform impetus has gathered increased force, but its direction has changed.
The judicial reform concept approved in 1991 was full of ideas of judicial independence, democracy and human rights. After the 1 1/2 dozen bills compiled by the presidential administration and State Duma under the pretext of resuming judicial reform have been passed, these values will be nothing but pleasant memories. This is eloquently proven by the draft Criminal Procedural Code, which passed its second reading June 20.
The authors of the code didn't choose to put a stop to flourishing illegal practices like police torture, forgery of evidence, the dependence of the defense upon the prosecution and the accusatory tone of the courts' work. Under the present draft code, for instance, a suspect is read his rights only after his explanations have been entered into the record. Judges are not required to question witnesses or examine evidence when satisfying the prosecutor's request for charges. The defense must have the prosecution's consent to present a witness or to enter a document into evidence. Prosecutors, however, may use the evidence of even anonymous witnesses, whose names may be withheld even from the defense.
Further, under the proposed code, if a witness fails to appear in court, the judge may - at his or her discretion - enter the witness' evidence into the record anyway, without even explaining why the witness is absent. In such cases, the defense has no opportunity to cross-examine and the whole proceeding becomes something akin to a bureaucratic inquisition.
Under the new rules, it will be easier to remove a judge hearing a case, even before a verdict is rendered, making it possible for the state to manipulate verdicts as it pleases. The right to record court proceedings, which was granted way back in 1986, will be taken away. And so on and so on.
The proposed draft contains elements that the Soviet authorities were ashamed to enshrine in law even back in the 1960s. For example, the code's authors require the defendant to prove his innocence, thus trampling on the presumption of innocence and transferring the burden of proof to the defense. Under the new code, an individual judge is able to hand down prison sentences of up to 10 years and in certain circumstances can impose sentences of up to five years even in the absence of the accused. Appealing convictions also is more difficult because of new requirements that are not easy even for a professional lawyer to meet.
Having packed the proposed code with unconstitutional and inhumane provisions encouraging arbitrariness and turning the right of the accused to legal defense into fiction, the authors of the code have gotten rid of the only institution able to balance the moral weakness and bureaucracy of the judges. From now on, representatives of the people will be allowed to participate in administering justice only in 89 out of the 2,500 courts in Russia - in not more than 0.8 percent of criminal cases. Jury trials are to be introduced throughout the country, but only in the 89 regional courts.
Can judicial reform depriving people of their constitutional rights and taking away their ability to influence the destiny of their fellow citizens be considered democratic?
As to doubts about the independence of judges, who have already acquired the psychology of the petty bureaucrat, they are not at all groundless. Today, the higher judges receive passes to special medical clinics and canteens, and they get dachas in Zhukovka and personal cars from the hands of the presidential administration. Now the inefficient carrot shall be complemented (or replaced?) by the stick.
If a three-year "trial period" is established for newly appointed judges, if judges are to be held accountable for misdemeanors and violations of work regulations, if presidential representatives are to be included in the Qualification Collegia and if a crime committed by the relative of a judge is to be reason enough to remove him - then many of my colleagues will find themselves "caught on the hook" of a line cast by those in the Kremlin. The process of returning judges to their familiar role as servants of the state will develop rapidly.
Among many innovations in regulating the activities of defense attorneys in the new code, independent lawyers' associations will be dissolved and lawyers will come under the direct jurisdiction of the Justice Ministry. Incidentally, they will be required to take a mandatory loyalty oath to the state, a practice that our reformers may have picked up from a similar statute from Nazi Germany. The Justice Ministry will determine who receives a license to practice law.
There is a lot of history behind the latest judicial reform proposals. I can see the influence of Count Dmitry Bludov, who wrote his own legal reform in 1857 that was actually rejected by the Russian tsar as being too oppressive and illiberal! I can also hear the voice of Konstantin Pobedonostsev, who wrote a report in 1881 declaring directly that judicial independence is harmful and contradicts the interests of the state.
But you don't have to go back that far. Soviet prosecutors Nikolai Kirilenko and Andrei Vyshinsky also would have voted for Putin's judicial reforms. In 1932, Kirilenko said that only cretins try to hide behind the Criminal Code. For him, invoking your rights was the same as admitting your guilt.
Finally, it is no exaggeration to say that these reforms owe a certain intellectual debt to the legal reforms introduced in Germany by Adolf Hitler in the 1930s. Already back then, Hitler saw the advantages of being able to fire judges on the spot, of forcing judges and lawyers to swear their loyalty to the state and of appointing an SS officer to observe every court proceeding and present the Fuhrer's views to the judge.
Sergei Pashin is a retired federal judge with a doctorate in law. He contributed this comment to The St. Petersburg Times.
TITLE: These Ends Don't Justify West's Means
TEXT: SLOBODAN Milosevic is now in the custody of the UN War Crimes Tribunal at The Hague, and the world is thrilled by the possibility that this tyrant will actually be made to pay for his crimes.
Some are even going so far as to speak of a new era in international politics, one in which national leaders will moderate their behavior for fear that they too may have to account for themselves. Future Milosevices, they say, will think twice.
So far, so good. But if you think about it a little bit more, this new era in international politics looks a lot like the old era. The way in which Milosevic's surrender was extorted looks just like the age-old practice of strong nations lording it over weaker ones.
The West - conspicuously headed by the United States - bullied Yugoslavia into complying with its will by withholding badly needed reconstruction aid. The shame of this lies in the fact that the current regime in Belgrade is universally recognized as democratically elected, popularly supported and profoundly committed to democratic and open market reforms. It is a fragile coalition that is bravely coping with the debilitating political, social, psychological and economic legacies of Milosevic's disastrous reign.
Instead of applauding the efforts of Yugoslav President Vojislav Kostunica and bending over backwards to assist him and to show the Serbian people that they have made a wise and decent choice, the West has pulled the rug out from under him. It has pitted Kostunica - who has wisely stated that legal and constitutional procedures must be scrupulously observed even if it delayed bringing Milosevic to justice - against his own government. It has pitted Serbia against Montenegro. It has reopened deep divisions in Yugoslav society.
Instead of allowing Serbia to come around to making its own decision on Milosevic in its own time and of its own accord - a process that has quite clearly been underway practically since the day Kostunica took office - the West has needlessly put its own agenda above the interests of Yugoslavia and regional stability.
Like virtually everyone else in the world, we are overjoyed to see Milosevic in the dock. But the way that he got there is, in a word, wrong. The rules for international relations in such cases probably shouldn't differ much from the ordinary rules of human decency. When a friend is suffering, you help him. You don't hold his head under water until he cries "Uncle!"
The West had clearly shown Yugoslavia what kind of a "friend" it is. There simply isn't much for the West to be very proud of in this story.
TITLE: Russia Needs Real History, Not Therapy
TEXT: A new textbook on Russian social history has appeared in bookstores, which is something to delight in. However, the book begins by saying that our compatriots need "cliotherapy" - in other words, to be healed by history.
Although the term cliotherapy appears to have been just made up, the idea is hardly new. Modern life is full of humiliations, injustice and base intrigue, but we can immerse ourselves in the great history of our ancestors and recall their heroic victories to feel better.
The problem is that a "therapeutic" history is a false history: The past is as full of repulsive scenes as the present. Russia's history is an unworthy object of tender love - with its serfdom, bureaucratic corruption, backwardness and illiteracy carefully guarded by the authority of the state. For the sake of fairness, one should say that in this regard Russian history is no worse than any other. If you read English or French history honestly, you'll find treachery, cruelty and horrible cases of social injustice. History is hardly fit for comforting us.
This is true, however, only of an honest history. The "therapeutic" trick is to have a selective look at history, at a comfortable angle and picking out the most advantageous fragments. In other words, turn history into ideology, a justification of the state.
The worse the present situation is, the louder the speculations about the great past. This is how history was used in Italy and Germany in the 1930s. The results were so catastrophic that "imperial myths" were buried in both countries, and the first attempts to revive them are being made only today.
Modern Russia, on the contrary, is desperately looking for a new historical myth. The Soviet period cannot be the source of inspiration, because the new Russian state was built as the Soviet Union crumbled. That's why in the early 1990s, double-headed eagles, tricolors and other symbols of the old empire - which had been mocked by fighters of autocracy back in the 19th century - became suddenly of use again. As if monarchy can be an ideal for democracy.
Of course, it isn't the symbols that matter, but what stands behind them. The greatness of the empire rested not only on the oppression of the subjected nations, but on the exploitation of Russia's own peasants. The history of our capitalism is full of repulsive scenes, too; it is enough to recall how industry was built on the slave labor of peasants who were "attached" to the factories by the government.
Recollections of imperial greatness and nostalgia for Soviet superpower have somehow become one. The most fervent enthusiasts of the "state idea" are telling us that Russia has never conquered anyone (everybody joined voluntarily). On the other hand, Tatar, Ukrainian or Chechen nationalists can no longer see anything but reprisals, oppression and injustice in the history of their relations with Russians. Which is, in essence, the same lie - the opposite side of the same imperial myth.
The problem is that "imperial" propaganda requires us to take pride in what we should be ashamed of and to forget those who could truly inspire national pride. We have to revere tsars and generals and not say a good word about those who resisted them, rebelled and defended human dignity.
History should teach, not heal. That is why knowledge of its dark sides may be even more important than memories of past greatness.
Boris Kagarlitsky is a Moscow-based sociologist.
TITLE: Japan's Dirt Is Looking Just Fine
AUTHOR: By Russell Working
TEXT: SAPPORO, Japan - Recently while strolling through the fishing village of Rausu in Hokkaido's wild and mountainous Shiretoko Peninsula, I happened across two women - one British, the other Japanese - who were touring Japan on foot.
When I mentioned that I live in Vladivostok, the Briton said she would love to see this Russian seaport on the Sea of Japan. Somehow I felt I should warn her. "It's kind of ugly - lots of box-like Soviet apartment blocks and rusty ships in the bay," I said.
"Oh, Japan is very ugly in places," she insisted as her friend nodded. "You ought to take a look down by the waterfront here in town."
Amazed, I said nothing. I had been walking around in the post-traumatic daze that hits one after a long stay in provincial Russia. Rausu's marina was bobbing with white fishing boats, not the scabrous Russian hulks whose engines die at sea. In place of slum apartment blocks, the houses were modest and toy-like. There were snowcapped mountains, shops filled with clothes and televisions, and spotless streets where dog-walkers clean up after their pets with a trowel and a plastic bag. In Vladivostok apartment blocks, dog owners let their pets squat in the stairwell.
The encounter with the travelers wouldn't be worth mentioning if I hadn't run across an item in the Atlantic Monthly magazine's online edition that indicates that their views are not isolated. In a June 21 exchange, correspondent James Fallows discusses a new book - "Dogs and Demons: Tales From the Dark Side of Japan" - with its Japan-based author, Alex Kerr. Fallows writes that the book's "single most startling assertion, at least for those who have not spent much time in Japan, is that 'Japan has become arguably the world's ugliest country.'"
He adds, "To me, this judgment rings absolutely true."
I have no doubt there are thousands of square kilometers of industrial wastelands and concrete jungles that I have somehow avoided during my visits to Japan. But to this visually starved visitor, lamentations about Japan's ugliness sound like the carping of someone who doesn't know how good he's got it.
Compare at random any Japanese city with its counterparts in the Russian Far East. In every provincial Russian village, windowless buildings stand like war ruins, filled with rubble and shattered vodka bottles. Shops are housed in rusty shipping containers, and junk cars are left on roofs so scrap metal thieves won't steal them. Aboveground hot-water pipes snake from boiler houses to apartments, forming rusty arches as they hop over roads. Drunks throughout the land have reached the consensus that elevators were meant to double as urinals.
Soviet-era construction dominates the landscape. Slabs of prefab concrete are glued together, like Legos, with black tar. The slabs have been known to drop off the face of an apartment, leaving the startled homeowner sitting in a room exposed to the elements. Even the grander buildings - the palaces of culture, the former party headquarters - are piles of concrete. The only attractive architecture is either pre-revolutionary or (to a lesser degree) post-communist.
In the medieval Japanese capital of Kyoto ("one of the world's drearier urban landscapes, on a par with some industrial cities in China," in Kerr's words), I admired the wooded temple sites, the department stores filled with consumer goods, even the neon signs and 24-hour electricity that attested to a vital urban life. In Vladivostok, the main Orthodox church sits in a trashy neighborhood a block from the dump, and to enter you must run a gauntlet of beggars, occasionally drunk. Department stores do not exist, apart from an old Soviet state store that sells goods such as backpacks whose straps are stapled on (not sewn). The city periodically endures weeks of blackouts.
Even Kyoto's enormous modern train station, which I assume Kerr and Fallows regard as one of Japan's architectural barbarisms, seemed clean, sleek and a little overwhelming to my Russia-dulled eyes. I rode the seven-story escalator to the top just for the fun of it. There are no escalators in Vladivostok.
If residents consider Kyoto to be one of the world's drearier urban landscapes, I have a solution: Pack the whole city up and ship it across the Sea of Japan. In turn, we will send over Vladivostok's high-rise slums, its rusty sheet-metal factories and its offices with wiring stapled to the interior walls. It's a trade most people here could live with. The question is, could Japan?
Russell Working is a freelance journalist based in Vladivostok.
TITLE: Modern Military Needs Balanced Spending Plan
TEXT: LAST week the administration of U.S. President George W. Bush added a further $18 billion to its Pentagon budget request for next year, bringing the total to $329 billion. That is a lot to be spending on defense programs in a world in which the United States confronts no superpower rivals.
Yet most of the latest additions are reasonable, with the bulk of the $18 billion going for improvements in military pay, housing and health care, training and spare parts. There is also new money for additional research and testing of missile defenses.
Still, this increase builds upon an earlier one, and if Congress approves the full request, as seems likely, next year's military spending will be $33 billion more than this year's, the biggest one-year increase since the buildup under then-president Ronald Reagan in the early 1980s. Even bigger spending jumps are anticipated in the following year's defense budget, which will be drawn up after completion of the ambitious reviews of strategy and weapons requirements that was ordered by President Bush earlier this spring. Those are likely to call for expensive and futuristic new weapons programs. With the recently enacted tax cut and a weakening economy eroding future budget surpluses, Washington cannot afford repeated big increases in defense spending.
Although the United States already has the world's most advanced weapons, continued investment in modernization is needed to keep the armed forces prepared for the rapidly changing military needs of the future. The Navy needs lighter and faster ships. The Army needs lighter artillery pieces and smaller tanks. The Air Force needs more pilotless drones.
To pay for these needs, the Pentagon will have to eliminate obsolete weapons systems designed for Cold War needs, including some just now entering into production. There is also a strong case for trimming the overall size of the armed forces to fit their likely new missions. One purpose of the current Pentagon reviews is to target appropriate areas for such savings.
Defense Secretary Donald Rumsfeld's recent calls for retiring a third of the Air Force's obsolete B-1 bombers, dismantling 50 MX multiple-warhead missiles and closing scores of unneeded military bases are a good start. But more aggressive cutting will be needed, much of it likely to arouse fierce Congressional opposition from affected districts. Military modernization will be affordable only if the Bush administration proposes and then fights for deep cuts in Pentagon programs that have outlived their usefulness.
This comment originally appeared as an editorial in The New York Times.
TITLE: Is This Really the End of Caviar as We Know It?
AUTHOR: By Christopher Pala
PUBLISHER: Special to The St. Petersburg Times
TEXT: Russia and two other countries have temporarily banned fishing for sturgeon to protect dwindling stocks. As Christopher Pala reports from Ikryanoye, or Caviartown, the fish prized for producing caviar may have outlived the dinosaurs, but they may not long outlive communism.
In a sprawling fish farm 50 kilometers north of Astrakhan, on the verdant banks of a Volga River swollen by spring rains, some 200 female sturgeon, each about a meter long, swim slowly in the greenish waters of one of the large ponds.
These females were raised here and underwent the fish equivalent of a cesarean section. In a matter of minutes, they were anesthetized, their bellies were opened, the roe was taken out, they were sewn up again and were returned to the water. The operation is not intended as a more humane way to satiate the craving for caviar of the truly rich - the female is normally killed before the eggs are extracted - but as a desperate attempt to continue the yearly release of 50 million baby fish, hatched from eggs taken from females swimming up the Volga.
The Bios hatchery, located outside Astrakhan in the village of Ikryanoye, literally Caviartown, releases 2 million of those fingerlings, as the little squiggling fish are properly called, into the Volga just above the head of its delta.
HELPING HAND
Hatcheries like Bios play a key role in keeping the Caspian sturgeon alive. After growing up at sea, about 70 percent of the scaly, pointy-nosed fish head for the Volga to mate, while another 15 percent go up the Ural River, in Kazakhstan; 10 percent spend most of their life in Iranian waters; and 5 percent reproduce in the small rivers of Azerbaijan and Dagestan. As for Turkmenistan, the last of the Caspian states, it is largely devoid of rivers and sturgeon do not mate there.
The construction of a dam at Volgograd in 1960 deprived the sturgeon of their main spawning grounds further upriver. Despite the image of caviar as a delicacy for tsars, decadent aristocrats and fat-cat capitalists, the Soviets took the threat seriously and banned all fishing at sea, built a string of hatcheries and retrofitted four ships to take the fingerlings to the best feeding grounds, on the coast west of the estuary.
Thanks to those ships, the proportion of fingerlings that survived the decade or so at sea to sexual maturity and returned to the Volga to reproduce tripled from 1 percent to 3 percent.
The Caspian became a giant fish farm. Virtually all of today's beluga - the largest and scarcest species and the one that takes longest to reach maturity - were born in hatcheries, some for the second generation, along with about half of the sevruga and the osyotr, the two other commercial sturgeon species.
Alexander Kitanov, who describes himself as Bios' "fishmaster," explained that in order to release 2 million fingerlings a year, he must pick and choose the females of ideal size and condition from sturgeon hauled in from the river. The catch for the hatcheries - 120 tons of fish this year - is separated from the catch for the sale of caviar and meat.
"Even five years ago, we could only take the females in ideal condition and let the rest go," he said. "The caviar from the really big fish - 150, 200 kilograms - is tasty, but most of the eggs don't hatch. And the same is true of the eggs of females that are too young."
But today, he said, the stock of mature females has been cut so drastically by poachers that he has to take all the eggs he can get. "Eighty percent of the females we're seeing aren't fully mature," he said. As a result, the proportion of eggs that do hatch has plummeted.
"The poachers used wide-mesh nets because they wanted big fish," said Sveta Bolshakova, an ichthyologist with 17 years' experience in sturgeon research. "Now that most of the big ones are gone, the younger females are starting to reproduce before they are fully mature. Their offspring are going to be fewer and weaker.
So, as a hedge against a further decline in the catch of pregnant females, the Bios hatchery began a unique program: performing cesarean operations on a stock of captive sturgeon that had been raised for commercial purposes and raising their fingerlings in order to release them in the river once they are 40 days old. The females are kept until they can reproduce again two or three years later.
POACHERS' TAKE
For fishermen and even poachers, the evidence of overfishing was clear as this year's season drew to a close: Each year it becomes harder and harder to net sturgeon. Caspian caviar exports have fallen from 2,000 tons in 1978 to 500 tons in 1991 to 160 tons last year.
However, the figure for this year's official catch is misleading; scientists estimate that the poachers' take, both at sea and in the rivers, is 12 times the current official catch. Thus, if the official catch is worth $100 million, the illegal catch, though it fetches much less per kilogram, is probably several times more valuable than the legal one.
There is wide consensus on who is the main culprit: fishermen in the Caspian Sea itself. Since the Soviet collapse and the general weakening of law enforcement, they have been laying wide-mesh nets off the coasts to catch only sturgeon, the largest fish in the sea. Stocks were halved in four years.
River poaching has worsened, too. While in Soviet days it was an amusing pastime - legal caviar cost 3 rubles a kilogram, old-timers remember - it has become a business akin to drug running. The poachers use nets or lines dripping with hooks along the bottom of the river, pull them up at night, rip out the caviar and often toss back the dead sturgeon.
They sell the caviar to illegal canneries where, in conditions more attuned to clandestine operations than to taste or hygiene, the caviar is salted and placed in cans and jars that imitate those used by legal canneries.
These cans supply the Russian market and are exported to Turkey, the Gulf states or Eastern Europe, where customers and customs officials are not too demanding.
As for the legal Russian canneries, in the last few years virtually all of their production has been for export. So as a result of the war on poachers, there is no caviar in the stores of Astrakhan, in contrast with the rest of the country. Only through the judicious use of winks and nods can one open a can of fresh caviar.
STABLE POPULATION
Off a dusty avenue near the outskirts of Astrakhan squats a rundown building that houses the Caspian Fisheries Research Institute.
In a fourth-floor office, Raisa Khororevskaya, a senior researcher specializing in sturgeon population numbers, says that in 1994 half the Caspian sturgeon were fished off and the hatcheries' budgets were severely cut. The population has since stabilized at 35 million to 40 million sturgeon as the hatcheries resumed production.
"The difference with 10 years ago," she said, "is that 90 percent of the young adults have been fished out. It's like after the Great Patriotic War [World War II] - there are plenty of young ones, but most of the adults are gone."
"The sturgeon is probably the single most vulnerable wildlife resource in the world today," said Robert Hepworth, a deputy director of the United Nations Environmental Program.
A second paradox is that a part of UNEP that deals with the protection of endangered species, the Convention on the Trade of Endangered Species, or CITES, which began regulating the caviar trade in 1998, had given Iran, whose haul of sturgeon is a seventh of Russia's, an export quota of caviar of 82 tons to Russia's 50.
That, according to Khororevskaya, is because the Iranians breed a subspecies of osyotr sturgeon known as the acipenser persicus that - unlike the Russian osyotr, the slender sevruga (both bottom feeders) or the predatory beluga - does not migrate around the Caspian but stays largely on its southern rim, which belongs to Iran.
In addition, poaching in Iran is said to be minuscule in comparison with its post-Soviet neighbors.
CITES expressed its disappointment on June 21 with three years of cajoling the post-Soviet states into making an effort to cut poaching, and effectively banned sturgeon harvesting as of July 20, drawing a protest from one of the fish's staunchest defenders.
"It's not fair to ban fishing in Russia and Kazakhstan but not Iran," said Vladimir Ivanov, the director of the research institute. He pointed out that only two-thirds of Iran's export quota are Persian osyotr bred in Iranian hatcheries, while the rest are born in the wild or in Russian hatcheries.
"It's particularly irritating to see that Iran exports 4 tons of beluga caviar, since today virtually all beluga are born in Russian hatcheries," he said. "They're very difficult to breed, and the Iranians don't know how to do it."
Beluga caviar, the rarest of the commercial species, now retails in the West for $3,000 a kilogram - or, illegally, for $60 a kilogram in Astrakhan and $200 a kilogram in Moscow.
"Of course," Ivanov continued, "I hope this will motivate the Caspian nations to finally sign the agreement on Caspian bioresources they had prepared back in 1995." It provides for the creation of a joint force made up of law enforcement officials from five countries to staff anti-poaching patrols in the Caspian Sea.
The ban will remain in effect indefinitely unless the four states, at a meeting with CITES officials set for the end of the year, are able to convince the organization that they are making real progress in fighting poaching. So far, the states have invariably reported extensive measures and great progress.
In a report, the secretariat of CITES said it "was not able to reach a conclusion on the adequacy of existing fisheries' management practices except that if harvest limits were adequate and if trade controls and enforcement were adequate as claimed, a marked decline in stocks and catches should not have occurred."
Following last Thursday's decision, "Any failure on the part of these states to implement this week's agreement will result in zero quotas for 2002," said Aveen Haller, a CITES official.
For Vyacheslav Mironov, the director of Russkaya Ikra, or Russian Caviar, the decision could have been worse. CITES had embargoed the 2001 quotas of Russia, Kazakhstan and Azerbaijan until its meeting in Paris this week, and had threatened to ban exports if the countries did not come up with a rescue plan.
Mironov's 4 tons of caviar, already placed in 50- and 90-gram cans, held at minus 5 degrees Celsius, and destined mostly for Japan at prices of $600 to $900 a kilogram, will at last reach their market.
"Still, to ban our exports is ridiculous," Mironov said. He pointed out that in 1999, when Russia's CITES quota was 30 tons, CITES itself reported receiving documentation for the export of 45 tons - 15 tons of which presumably had falsified papers. Meanwhile, he said, official Russian customs figures for that year showed exports of 486 tons - all but 30 tons of it illegal.
"There is plenty of sturgeon in the Caspian," Mironov said. "It's just that the poachers are fishing it and not us."
OUT OF HAND?
How the post-Soviet governments will succeed in reversing these proportions and slashing the total amounts of fish caught remains an open question.
Ivanov, the head of the research institute, expressed optimism. "I think the conditions are finally right for us to reverse the decline," he said.
For Bolshakova, the veteran sturgeon specialist, the measures are not likely to succeed. "The species has been genetically weakened," she said.
Anti-poaching patrols have failed and they will continue failing, she said.
"The area is just too big to control," she added, and the poachers are too powerful. Five years go, she recalled, in Dagestan, a truck bomb killed 68 people and destroyed an entire block of apartments of border guards, who are responsible for patrolling Russia's coastline.
"To save the sturgeon, the West would have to pour in a lot of money for helicopters and ships and have a real multinational force patrol the sea," she said. "I don't think that's going to happen. In five years, there really won't be much left."
TITLE: Riefenstahl: We Have No Right To Reject Ideals
AUTHOR: By Galina Stolyarova
PUBLISHER: The St. Petersburg Times
TEXT: Perhaps the central event of this year's "Message to Man" film festival was the screening of Leni Riefenstahl's Nazi propaganda films "Triumph of the Will" and "Olympia," with the author herself coming to St. Petersburg to enjoy a standing ovation during a screening. Rarely meeting audiences in recent years, Riefenstahl was surprised to see tears in some people's eyes - an emotional and compassionate reaction she didn't expect to find in Russia. The controversial 99-year-old German film director talks about her life and career.
Q: Have your impressions of Russia matched your expectations? Do you know that some of your films, including "Olympia," were even available in Soviet times?
A: I couldn't even imagine that my films are known here. My inner sympathy for your country led me to accept the invitation to visit this festival. I am deeply connected with Russia: My mother's ancestors came from this country and I have heard a lot about Russia. And that is why I made the decision to come here immediately.
Q: What do you feel when watching your first films?
A: Probably just like any director, when I watch my early works I feel nostalgic. I feel particularly warm emotions about my first films because I began my career with them. I love my work very much, and so the nostalgia I experience is natural.
Q: You are frequently referred to as one of the symbols of the 20th century. What is the main lesson of that century?
A: I would say that the main symbol or the main concept of the 20th century is hope for some kind of an ideal life, the life which both Russians and Germans lived and the failure of these hopes. Hope, faith and the collapse which followed.
Q: What do people think of you in Germany? Are you considering shooting a film about the country?
A: It is difficult for me to talk about it. I love my country very much and I am very sorry it is not as beautiful as it used to be. I can't even think of shooting a film about Germany: It would be a very serious project for which I have neither the energy nor the opportunity. I have several other projects I have to complete.
Q: What are you going to work at in the near future?
A: My latest project is devoted to the underwater world. It is nearing completion now, and the shootings - which took place literally all over the world where we could find the coral we were looking for - are already over. Now we are editing the film.
Q: Why did you switch your focus to the underwater world?
A: I wasn't seeking a refuge or hiding from people, and I don't pretend that I managed to solve any riddles about the human condition. It is simply that the underwater world attracts me. When I first went diving myself, I was 72, and I thought that showing this fantastic world to other people is the most important thing I can do. To show what they wouldn't be able to see themselves.
Q: When was the happiest time for you as a professional?
A: The happiest time for me was when I was an actress. I was independent. When I was dancing I felt free and liberated. The feeling of freedom was the greatest happiness for me. I have to say that in 1934 I was shooting a film commissioned by the Nazis. In 1934 all the world admired Hitler, the German nation admired him and associated certain hopes with this man. Initially this film wasn't a political statement, I was just filming what was happening around me. That is why before the war this film received recognition first and foremost as a piece of art.
Q: Why do totalitarian regimes produce great artists?
A: I think that humankind has no right to abandon ideals, reject them, live as if they never existed. People have to strive for their ideals and fight for them, but the important thing is the means you use to achieve your goal. The moment when humankind gave up its ideals would be a kind of suicide.
There is undoubtedly a connection between totalitarian regimes and great talents. Despite the horrors and tragedies of the totalitarian regimes which existed in Germany and Russia in the 20th century, they contained many ideas focusing on how to make the ideals come true, which, in turn, led the authorities to encourage talented people.
Q: Did you anticipate the collapse of the Nazi regime?
A: No, there wasn't any feel of a coming disaster - neither consciously nor subconsciously. There was just a faith in the future, and we all sincerely believed that everything would be fine.
Q: Nazism and Stalinism are often seen to have a lot in common. Do you see a similarity between Hitler and Stalin?
A: I think they are very similar, they had a great deal in common. The difference, in my opinion, is that Hitler was more of a socialist, he devoted himself more to the social sphere from the beginning, at least that was what was said and done. The workers felt joy in their work, and that was important.
Q: Was there a moment in the film when you shuddered?
A: For me the first shock was the news of Hitler's suicide. I was filming in the mountains when the news arrived. I was shocked because all my hopes were associated with this man, and the belief in a bright future.
But as I gradually realized what had actually happened during the Nazi era the feeling of horror grew. It led me to have a serious nervous breakdown, and it took me several more years before I got over it.
Q: If you had received a proposal back in 1935 or 1937 to shoot a film about Stalin, would you have accepted it?
A: I refused to produce films about Hitler or for Hitler. That is why I can't see myself shooting a film about Stalin. I wouldn't have done that.
Q: Would you have made a film about the Nazis if you had known how it would all end?
A: I have already answered this question in my memoirs, where I talk about how I began to make propaganda films. I didn't want to film politics. I left the country, I started making a different film, and did my best to avoid political themes. But I had to agree to make the film, because I had no choice. But I did it under the one condition that I would never film propaganda again. I wanted to make art films. And indeed, I never made political films again. The next film I made was "Spanish Legend," a very romantic movie.
TITLE: U.S. Expats Gear Up for July 4
AUTHOR: By Sam Charap
PUBLISHER: Special to The St. Petersburg Times
TEXT: Although many Americans come to St. Petersburg to escape their culture, this Wednesday - July 4, American Independence Day - will be the occasion for nostalgia and homesickness for many in the expatriate community.
After all, the staples of U.S. culture that Americans are so accustomed to on this day - apple pie, cheeseburgers and open-grill barbecues - are hard to come by in St. Petersburg.
For Kira Richards, who hails from Iowa City, Iowa, and is spending the summer studying here, Wednesday will be about "missing home. Definitely there'll be nostalgia . . . I'm going to miss the fireworks and spending time with my family. I had made plans earlier in the year, but I didn't realize that I'd be in the middle of Russia at the time."
The 4th will be a rare occasion for St. Petersburg's somewhat disparate American expatriate community - estimated at about 1,000, plus transitory students and tourists - to gather together, and reminisce about home.
While the events here pale in comparison to the massive all-day party planned in Moscow by the American Chamber of Commerce, an event which drew around 10,000 guests last year, there will be several opportunities for Americans to attend celebrations which will try to replicate the July 4 experience, albeit in a rather low-key way.
For the business community, the local branch of the American Chamber of Commerce has organized an event set to be held on Saturday, July 7, as its members have to work on the 4th.
Alexei Kim of the Chamber of Commerce describes the day as a "traditional American picnic-barbecue event," to be held at the suburban-style-housing compound at Dubravy, near the Pionerskaya metro station. The invitation-only affair will include a 3-legged race, balloon toss, tug of war, whiffleball, and a country music band to provide entertainment.
Douglas Boyce, the general director of the Lomonosov Porcelain Factory who is celebrating his 10th year in Russia, said, "I plan to be there and to take a number of my Russian staff from the porcelain factory so they can get a bit of flavor for what the 4th of July means for Americans . . . It's a chance to show them what Americans are like when they relax and have fun."
For those in diplomatic circles, U.S. Consul General Paul Smith has planned a "standard reception at my residence which is fairly modest because of the size of the place - I don't go to a hotel or anything." Smith expects about 300 guests, including Russians and Americans, mostly from the business, political and educational spheres.
Americans without diplomatic or business credentials can look forward to an all-day celebration at Senor Pepe's Cantina at 3 Ulitsa Lomonosov.
Although Pepe's usually serves Mexican cuisine, Rudy Mosqueda, one of the restaurant's owners, said guests can expect a "standard Western-style barbecue," with hot dogs, BBQ chicken and, of course, apple pie.
Mosqueda hopes that the event will provide "a place where expat Americans, other foreigners and their Russian guests can enjoy a traditional U.S. Independence Day celebration. It's an opportunity for Russians to come with their American friends and experience a major U.S. cultural holiday."
If this all seems a bit tame, however, and time and money allow, you might like to make a quick trip to Moscow and join in the Amcham celebrations, which will be held on July 7. Check out www.amcham.ru for details.
TITLE: In Memory of the City's Most Dangerous Floods
AUTHOR: By Simon Patterson
PUBLISHER: Staff Writer
TEXT: One of the more sinister features of St. Petersburg life are the floods which strike the city with alarming frequency. The most serious floods have been commemorated on various plaques which show the level the water reached. The one pictured here is on the Moika canal near St. Isaac's Square.
Three times in the city's history - in 1777, 1824 and 1924 - St. Petersburg has seen truly devastating floods. During the flood of Nov. 19, 1824, which is commemorated in Alexander Pushkin's poem "The Bronze Horseman," the water level rose 4.21 meters, killing more than 200 people and destroying 462 buildings.
The most recent major flood took place on Nov. 30 1999, when a massive storm blew water in the Gulf of Finland upstream, causing the Neva river to peak at 2.66 meters above Baltic sea level. It was the worstflood the city had experienced since the waters rose 2.8 meters in September 1975.
The city administration has been battling with the problem of flooding since the late 1970s, when the construction of the Flood Protection Barrier in the Gulf of Finland began. But like many other projects in the city, funding for construction has been low, and it has yet to be finished. City officials say they need at least $200 million to partially complete the barrier, which will be able to protect the city from any flood less than 5.15. meters.
Meanwhile, an unpleasant side-effect of the dam is the stagnant water in the Gulf of Finland behind the barrier, making beach-going in such suburbs as Solnechnoe and Repino a very smelly experience. However, it may be worth paying this price, as city forecasters warn that with each passing year, the possibility of a disastrous flood increases, which could well rival anything you may have read in "The Bronze Horseman."
TITLE: Cuba Mulls Prospect of Life After Fidel Castro
AUTHOR: By Anita Snow
PUBLISHER: The Associated Press
TEXT: HAVANA, Cuba - For a few minutes, this Caribbean island had its first taste of the emotions that will surge across Cuba the day Fidel Castro dies.
Shock, sadness, and fear were the immediate reactions to what the government said was Castro's "momentary fatigue" at a mass rally outside Havana a week ago. Security men led the 74-year-old off the stage after he swooned before the microphone in the sweltering sun.
Young people at the rally gasped and wept. In Havana's residential sections, people ran outside frantically to tell neighbors something had happened to "El Comandante."
Nerves were soothed later when Castro returned to the podium to ensure the crowd he was fine, but watching him grow weak reminded Cubans that their "Maximum Leader" is indeed mortal.
"People are somewhat disturbed by the natural eventuality of death," Castro said to reporters Friday.
"I ask the people's forgiveness beforehand for the day that something happens to me ... [for] the passing unpleasantness that it could cause them," added the Castro, who will turn 75 on Aug. 13.
In power since the Cuban revolution's triumph on Jan. 1, 1959, Castro also recognizes there are concerns about his replacement.
Castro himself has long insisted that his brother Raul, the 70-year-old defense minister, is his heir. He confirmed that several times after his fainting spell.
Castro told reporters Friday that his younger brother "is in good health ... and really after me he is the one who has the most experience, most knowledge, something that may not be well known.
Raul Castro's detractors note he does not have his brother's charisma and may be unable to gain the support necessary to rule the same way his brother does.
Also mentioned as a possible successor is Carlos Lage Davila, 49, the architect of Cuba's economic reforms in the 1990s and a man with experience in directing Cuba's centralized economy and government. He also is secretary of the Council of Ministers, giving him control over daily government operations.
Another name that comes up is diplomat Ricardo Alarcon Quesada, 64, long Castro's point man on Cuban-U.S. affairs and president of Cuba's parliament since March 1993. He was foreign minister for a year and served twice as Cuba's ambassador to the United Nations.
Then there is Foreign Minister Felipe Perez Roque, 36, a former personal secretary to Castro. He is the most influential of Cuba's younger leaders at a time the government is working to instill socialist ideals in young people.
Named foreign minister in May 1999, Perez oversaw Castro's schedule for seven years. The Communist Party newspaper Granma described him as "familiar, as few are," with Castro's thinking.
While talk of succession is now somewhat acceptable, open discussion about a possible change in Cuba's socialist system is not.
Cuban leaders are irritated by suggestions about a "post-Castro" period, saying Castro's ideas will live on long after he dies.
"There will be no post-Castro era," Lage said Tuesday during a visit to the United Nations. "And not because he won't die. Fidel's ideals and the ideals of socialism are every day more entrenched in our country."
TITLE: Israel Hits Syrian Radar Station
AUTHOR: By Zeina Karam
PUBLISHER: The Associated Press
TEXT: SARIN TAHTA, Lebanon - Israeli warplanes struck a Syrian military radar station in Lebanon on Sunday, wounding three people, as the government of Prime Minister Ariel Sharon aimed to punish Syria for Hezbollah guerrilla action.
Hezbollah quickly responded to the raid, firing rockets and mortars Sunday at Israeli military positions in disputed territory along the Israeli-Lebanese border. Israeli artillery fired back, wounding a farmer, Lebanese officials said.
This was the second time Israel has targeted Syria's presence in Lebanon in retaliation for a significant Hezbollah operation since Sharon came to office this year.
Sunday's tit-for-tat attacks marked a sharp escalation along the border, which has generally been quiet since the withdrawal of Israeli troops from southern Lebanon in May 2000 except for incidents over a still-contested corner of the boundary.
Two Israeli fighter jets fired two missiles at the Syrian radar position in Sarin Tahta village on the main road between the towns of Zahle and Baalbek around noon Sunday. Israel said the strike was in retaliation for Hezbollah fire that injured two Israelis on Friday night.
"It's been destroyed," said a Syrian soldier, armed with an AK-47 assault rifle, as he stood guard about 200 yards from the targeted position. He would not give his name. Journalists were not allowed to get any closer to the site, so his claim could not be verified.
Two Syrian soldiers were wounded in the air raid, Lebanese security officials said. Syrian soldiers on the scene said their comrades suffered shrapnel injuries to the arms and legs.
A Lebanese soldier was also wounded, a Lebanese military official said. The soldier was hurt while standing guard at an adjacent position, according to a witness.
The Sarin Tahta radar is one of many radar, tank and anti-aircraft positions that the Syrian army maintains in Lebanon. Syria has had a force of some 25,000 troops in Lebanon since 1976.
In Washington, White House spokesman Scott Stanzel said the State Department was in contact with all sides and was "urging the parties to exercise maximum restraint."
Lebanese Foreign Minister Mahmoud Hammoud said the attack confirmed "Israel's aggressive nature" and called on the United Nations to put a stop to Israeli airstrikes. He spoke on national television.
In Cairo, Arab League Secretary-General Amr Moussa condemned the airstrike, saying it added "a dark image to current developments and the future."
The Israeli Cabinet issued a statement in Jerusalem saying the radar station was attacked Sunday because Syria was responsible for Friday's Hezbollah guerrilla raid that wounded two Israeli soldiers in the Chebaa Farms region.
"This criminal activity by Hezbollah takes place under the authorization of Syria, whose army has a presence in Lebanon," the statement said. The army said it "will not tolerate" Hezbollah attacks.
Hezbollah has pledged to continue fighting Israel until it vacates the Chebaa Farms area. The territory is part of the Golan Heights, which Israel occupied from Syria. However, Syria and Lebanon claim the land belongs to Lebanon.
Sunday's attack was the first of its kind since April 16, when Israeli warplanes destroyed a Syrian radar station, killing three Syrian soldiers. That raid, which came after Hezbollah fire killed an Israeli soldier around the disputed Chebaa Farms area, was the first Israeli attack on such a significant Syrian target in years. Syria threatened to retaliate but never did, and Hezbollah operations eased.
Soon after the Israeli raid Sunday, Hezbollah fired mortars and rockets in the Chebaa Farms area. Hezbollah said in a statement that it hit an Israeli radar position there.
Israeli guns opened fire after the Hezbollah attack. Lebanese security officials said a farmer, Kassem Atwi, 60, was wounded in the shelling.
The leader of the Islamic militant guerrilla group, Sheik Hassan Nasrallah, warned Sunday of a tougher Hezbollah response. Israel was "playing with fire" and the airstrike against the Syrians "won't do them any good," he said at a Hezbollah rally not far from Sarin Tahta.
Nasrallah's deputy, Sheik Naim Kassem, said later that Hezbollah would continue to attack Israeli troops, "as will become evident in the coming days."
TITLE: Cheney Recovering After Heart Surgery
PUBLISHER: Combined Reports
TEXT: WASHINGTON - U.S. Vice President Dick Cheney rested at home Sunday, getting adjusted to his new pacemaker and anticipating a return to his White House duties on Monday.
"He's relaxing and looks forward to being back at work," said spokesperson Juleanna Glover Weiss. Cheney read and reviewed papers at the vice president's official residence, Weiss said.
Cheney's doctors gave him permission to resume his exercise routine, but Weiss did not know whether the vice president did so on Sunday.
The dual-purpose pacemaker was implanted in Cheney's chest in an hour-long procedure Saturday at George Washington University Hospital.
It works like any other pacemaker by assuring that his heart does not beat too slowly. When it detects the beat slowing below a certain level, it sends a mild electric charge to pace the beat at a minimum level.
More dramatically, if the heart suddenly surges to a dangerous, high-speed beat, the ICD defibrillator kicks in. It sends an electrical jolt to the lower chamber of the heart and causes it to slow down. Sometimes this will cause the heart to slow too much and that is when the pacemaker turns on and adjusts the rhythm.
That jolt could be jarring for Cheney, said Dr. Douglas Zipes, head of the American College of Cardiology and an authority on irregular heart rhythms who has consulted with the vice president's doctors.
"That is something he will feel, and patients describe it anywhere from a giant hiccup to a mule kick in the chest," Zipes said on "Fox News Sunday."
"With an electric shock, it contracts all of the muscles, not just the heart but the chest muscles. too," he said. "Yes, it's recognizable."
Cheney's cardiologist said there was less than a 10 percent chance that the defibrillator will be needed to calm Cheney's heart. Zipes was asked how the device will affect Cheney's daily life. "Probably not at all," he said.
Senate Majority Leader Tom Daschle said he had no doubts about Cheney's ability to serve in his job.
"Obviously this has been a matter that the vice president's had to contend with for many years," Daschle said on ABC's "This Week." "He's done it successfully, and I have every expectation he'll continue to do so."
House Speaker Dennis Hastert said on CBS' "Face the Nation" that Cheney has been "very, very vigorous in carrying out his office, and I expect him to continue to do so."
Cheney, 60, walked out of George Washington University Hospital a few hours after the surgery and said he was feeling well. He has had four heart attacks since 1978.
It was the third procedure to address his heart problems in the last eight months and came after a monitoring device two weeks ago discovered he was having episodes of a rapid heartbeat.
The procedure reignited questions about Cheney's ability to serve in the No. 2 job in the country. But the vice president said Friday doctors told him there was no reason he could not continue to function normally as vice president.
- AP, Reuters
TITLE: WORLD WATCH
TEXT: Coup Warning
PORT OF SPAIN, Trinidad (Reuters) - The prime minister of Trinidad and Tobago, who has long warned of plots to topple his government, has reiterated there are serious threats to national security following a major arms seizure in America.
With a broad brush, Prime Minister Basdeo Panday has implicated a former insurrectionist group, the main political opposition party and trade union leaders of trying to destabilize his government.
Opponents have accused Panday of paranoia and diverting attention from problems in the government, but last month's seizure of an arms cache in Florida, and the arrest of a Trinidadian allegedly linked to an anarchist group that tried to topple a previous government, have intensified fears of unrest.
Panday, leading the ruling United National Congress administration for a second consecutive term, said massive quantities of illegal arms and ammunition were being organized for shipment and some had already been smuggled into the oil-rich, twin-island nation of 1.3 million people.
"The anarchists who got away with arson, kidnapping and murder in 1990 are threatening to do it again," 68-year-old Panday said last week.
Treason Accusations
JAKARTA, Indonesia (AP) - President Abdurrahman Wahid, admitting he has been unable to forge a political compromise that would avert impeachment, accused his opponents Monday of treason.
On Aug. 1, the People's Consultative Assembly, the nation's highest legislature, convenes a special session and starts impeachment proceedings over allegations of corruption and incompetence.
The assembly has demanded that Wahid - Indonesia's first freely elected president in four decades - appear at the proceedings to defend himself by making an accountability speech.
Wahid, the near-blind Muslim cleric elected in October 1999, says it is illegal to force him to make such a speech.
"If this happens, and it is certain to happen because there is an act of treason, then it is certain that the special session will topple the president and our country will break apart," he said on Monday.
Wahid warned that a new wave of civil unrest could hit Indonesia if he is ousted. He called for new parliamentary elections to break the political deadlock.
Rape Charges Pending
TOKYO (Reuters) - Police were preparing on Monday to charge a U.S. air force sergeant in the rape of a Japanese woman, an incident that could trigger renewed anti-U.S. forces sentiment among local residents, domestic media said.
The local mayor plans to demand a curfew on U.S. servicemen.
After a fourth day of questioning, police were convinced, based on witness accounts, that the 24-year-old technical sergeant raped the woman early on Friday in a parking lot in Chatan on southern Okinawa island, Kyodo news agency quoted police sources as saying.
The man has denied committing the rape, Kyodo said.
Police would apply for an arrest warrant as soon as they coordinate arrangements with the National Police Agency and the Foreign Ministry, Kyodo quoted the sources as saying.
On Monday morning, the police summoned the man, who is in the 353rd Special Operations Group, for questioning for a fourth straight day. He has not been officially detained.
After obtaining the arrest warrant, police will ask the U.S. military authorities to give their consent for the arrest, and he can then be handed over to Japanese authorities.
He has been held in U.S. custody and is based at the huge Kadena Air Base, the biggest in Asia.
Belgium in Charge
BRUSSELS, Belgium (Reuters) - Belgium took up the rotating European Union presidency on Sunday with sensitive foreign and domestic problems set to dominate the six-month agenda.
Abroad, fighting in Macedonia is threatening a wider Balkans war and at home, people in the 12-member euro zone are preparing to ditch their notes and coins and swap them for the fledgling single currency.
And the European Union itself has been plunged into crisis since early June when Ireland voted to reject the hard-fought Nice Treaty, which the country had to ratify by referendum by the end of 2002. The treaty provides the basis for the eastwards enlargement of the bloc.
"The Belgian presidency comes at a critical time for the EU," Prime Minster Guy Verhofstadt said at a May launch of his country's priorities for the next six months.
An information campaign on the euro, Europe's common currency greater European integration in areas from immigration to defense policy and a bigger role in Africa all figure high on Belgium's agenda.
More Rebel Violence
SKOPJE, Macedonia (AP) - Defying new international efforts to help reach a negotiated peace, ethnic Albanian rebels are reaching out to grab new territory in their four-month insurgency against the Slav-dominated government.
A state radio report Sunday said the rebels took control of Otunje, Varvara, Setole and Brezno, ordering Slavic Macedonians they accuse of suppressing the ethnic Albanian minority to leave the area northwest of Tetovo.
Backing up the report, Setole resident Vase Zakovski told a reporter in Skopje that he left after "three armed and masked people ... told me to get out of the village."
Deputy Interior Minister Refat Elmazi, an ethnic Albanian, told The Associated Press he had heard reports that rebels had been in the communities over the past few days but had not heard of threats to civilians. Monitors with the Organization for Security and Cooperation in Europe were trying to get to the area to investigate the reports.
Lawyer Patents Wheel
CANBERRA, Australia - It may have been around for centuries, but an Australian lawyer has patented the wheel, The Age newspaper reported Monday.
Melbourne lawyer John Keogh took out the patent to prove that a new patent system introduced by the government is flawed.
The government stopped requiring patent lawyers because of complaints that they werew too expensive - making it possible to patent anything, Keogh said.
"The patent office would be required to issue a patent for anything," he said. "All they're doing is putting a rubber stamp on it."
Keogh said he has no immediate plans to patent fire or crop rotation.
TITLE: Sampras Loses at Wimbledon
AUTHOR: By Howard Ulman
PUBLISHER: The Associated Press
TEXT: WIMBLEDON, England - Pete Sampras' masterful run at Wimbledon ended stunningly Monday, his bid for a record-tying eighth title stopped by teenager Roger Federer.
The defending champion and winner seven of the last eight years, Sampras was upset 7-6, 5-7, 6-4, 6-7, 7-5 in the fourth round. It's his earliest exit at the grass-court event in 10 years.
Gone are Sampras' 31-match Wimbledon winning streak and the chance to match Bjorn Borg's five-consecutive titles from 1976-80. And Willie Renshaw's record of eight overall championships, set in the 1880s, is still safe.
All at the hands of the 19-year-old Federer, who lost in the first round in both of his other appearances at Wimbledon and has one career title to Sampras' 63.
Federer, a Swiss player seeded 15th, used a strong serve to keep Sampras off-balance.
When Federer hit a forehand on a return to break Sampras' serve and win the match, he dropped to his knees and raised a hand toward his face. Then he stood up and shook hands with Sampras.
Federer raised his arms and blew a kiss to the crowd. He appeared teary-eyed as he collected his equipment. Sampras, his face showing little expression, sat down briefly before the players walked off together.
Sampras was unbeaten in his five other five-set matches in his Wimbledon career and stayed stuck on 99 grass-court wins. Only 13 players have more.
Federer will play Todd Martin or Tim Henman in the quarterfinals.
"I'm very disappointed, obviously. I lost to a really, really good player," Sampras said. "He played great. He's a great shotmaker and won the big points. I had my chances."
The 29-year-old Sampras' ability to win already was in doubt because he hadn't captured a tournament since last year's Wimbledon. Now he's even struggling on grass, his favorite surface.
He had problems in the second round here against the world's 265th-ranked player, Barry Cowan, winning in five sets.
The tournament goes on without either of the top seeds. Martina Hingis lost on opening day last week.
In the fifth set, Federer and Sampras held their serves through 11 games. Then Sampras, who had won his previous serve without allowing a point, faltered.
He went down 0-30 before hitting a service winner. But that was his last point.
Federer returned the next serve and Sampras hit a forehand volley into the net. Then Sampras hit a hard deep serve, but Federer was ready for the return.
He drove a forehand down the line and Sampras, who had served from the right side, couldn't get over in time and his racket didn't even touch the ball.
"It was his moment," Sampras said. "It's grass-court tennis. One minute you feel like you have it, the next minute you're walking off the court."
Sampras nearly lost in the fourth set. Both players held their serves to force a tiebreaker, which was tied 1-1 when Sampras got the edge as Federer volleyed a ball into the net on his own serve.
Sampras also won the next three points.
The loss was Sampras' first at Wimbledon since the 1996 quarterfinals, when he lost to eventual champion Richard Krajicek, another big server, 7-5, 7-6, 6-4.
His winning streak began in the first round in 1997 with a straight-sets victory over Mikael Tillstrom.
Sampras, who was 62-5 at Wimbledon for his career before Monday, could start another streak next year.
"I plan on being back," he said, "for many years."
TITLE: African Countries Claim First World Cup Berths
PUBLISHER: The Associated Press
TEXT: Cameroon and South Africa became the first countries in qualifying to earn berths in next year's World Cup, and four-time champion Brazil stumbled again, losing 1-0 at Uruguay.
The United States, meanwhile, lost 1-0 at Mexico, its first defeat in six games in the final round of the North and Central American and Caribbean region. Costa Rica played at Honduras in a late game.
Cameroon and South Africa join defending champion France and co-hosts Japan and South Korea, which all get automatic berths in the 32-country field.
At Yaounde, Cameroon won 2-0 at home against Togo, getting goals from Samuel Etoo (27th minute) and Marc Vivien Foe (47th minute). The Indominable Lions (6-1) won Group A and became the first African country to qualify five times for soccer's premier event.
About 90 minutes later, South Africa gained its second-straight berth with a 1-1 tie at Burkina Faso that clinched Group E.
Sibutsiso Zuma scored for the Bafana Bafana (4-0-1) in the 24th minute at Ouagadougou off a corner kick and Alain Nana tied it in the 75th minute.
At Montevideo, Brazil remained winless in three qualifiers this year, giving up a goal on Federico Magallanes' penalty kick in the 33rd minute after Alvaro Recoba was pulled down in the area.
Brazil, the only team to appear in all 16 World Cups, was coached for the first time by Luiz Felipe Scolari, who replaced Emerson Leao following a 1-0 qualifying loss at Ecuador, a 1-1 tie in a home qualifier against Peru and first-round elimination at the FIFA Confederations Cup.
Brazil and Uruguay are both 6-4-3, with Brazil ahead on goal difference, both two points ahead of Colombia.
The top four countries in South America qualify and the fifth-place team meets Australia, the Oceania champion, in a home-and-home playoff for another berth.
Argentina (10-1-2) leads with 32 points, six ahead of Paraguay (8-3-2), seven ahead of Ecuador (8-4-1) and 11 ahead of Brazil and Uruguay (6-4-3).
In Africa, Nigeria (4-2-1) moved into first place in Group B, winning 4-0 at Sudan (3-3) as Liberia (4-3) lost 2-1 at home against Ghana (2-2-2) and dropped to second.
At Omdurman, Yakubu Ayegbeni scored in the 47th and 85th minutes for the Super Eagles, who also got goals from Austin Okocha in the 40th and Victor Agali in the 80th.
With one game remaining, Nigeria is one point ahead of Liberia, which finishes July 14 at last-place Sierra Leone (1-4-1). Nigeria plays at home against Ghana on the final weekend of July.
At Paynesville, Liberia overcame Charles Amoah's goal in the 35th minute and tied the score on Kelvin Zezwe's goal in the 58th, but Liberia went back ahead when Issa Mohammed scored in the 65th.
In Group D, Tunisia (5-0-2) remained in first place with a 6-0 rout of the visiting Republic of Congo (1-3-1) and Ivory Coast (4-0-2), which has a game in hand, remained three points back with a 6-0 win over visiting Madagascar (1-6).
TITLE: Zenit's Victory Keeps Spartak Moscow Moored in 2nd Place
AUTHOR: By Christopher Hamilton
PUBLISHER: Special to The St. Petersburg Times
TEXT: Zenit St. Petersburg's youth came alive with two goals during the second half to make up a one-goal deficit and defeat Spartak 2-1 Saturday, foiling the Muscovites' bid to end the first half of the Russian Premier Division season in first place.
Zenit rookie Alexander Kerzhakov scored his first Premier Division goal to tie the match at 1-1. Running up the right flank, the 18-year-old striker launched a shot from just outside the penalty box inside the far post past Spartak keeper Maxim Levinsky in the 70th minute.
Four minutes later 23-year-old defender Alexei Katulsky struck again for Zenit, finding the back of the net from just outside the goal box.
Zenit's victory could have been even more impressive, but it squandered several other opportunities.
Spartak came out strong during the opening half controlling the ball and mounting several dangerous counterattacks, but Zenit goalkeeper Vyacheslav Malafeyev played nearly flawlessly.
Spartak's dominance faded during extra time at the end of the first half when striker Alexander Shirko was sent off after getting his second yellow card for needlessly blocking a clearing kick by Malafeyev with his hand. He was booked in the 42nd minute for roughing.
Spartak's lone goal came in the 17th minute when Dimitry Parfenov converted a penalty kick awarded by referee Stanislav Sukhina.
With the game clearly under Spartak's control Sukhina found himself under attack when a Zenit fan rushed the pitch and ran after him before being removed by security.
Perhaps it was this incident that led Sukhina into adding five more minutes of extra time, which seemed to take hours to play as the fans were on the edge of their seats as Spartak mounted attempt after attempt to spoil the day.
The win moves Zenit up to sixth place in the standings with 25 points, four points away from league leaders Krylya Sovietov. Spartak is in second place with 28 points.
TITLE: Schumacher Earns 50th Victory of Career
PUBLISHER: The Associated Press
TEXT: MAGNY-COURS, France - Michael Schumacher speaks in terms of perfection, and translating that to a car racing has him on the verge of making history.
The three-time Formula One champion got his 50th career victory by outrunning brother Ralf on Sunday in the French Grand Prix, leaving Michael one win short of Alain Prost's record of 51.
"In Canada we had 1-2, Ralf and myself, and now we have 1-2, myself and Ralf," Michael said. "It's the perfect result."
It's also becoming a habit for the German siblings. Together, they have accounted for eight victories in 10 races this season.
Michael's sixth victory this year also moved him into a commanding lead over David Coulthard in the series standings. Schumacher has 78 points to 47 for Coulthard.
Ralf started on the pole for the first time in his career, but his BMW-powered Williams proved no match for Michael's Ferrari, and wound up second - 10.3 seconds behind. Ralf attributed his defeat to a bad set of tires and slow pit stops.
"I'm happy to be in second place because it was a disaster and really difficult to drive," he said. "I think I had a problem with the right wheel getting on.
But after 38 of 72 laps, Michael was getting around the 4.25-kilometer Nevers Magny-Cours circuit much faster and was ahead by nearly 18 seconds.
"Our strategy was better," Michael said. "It wasn't because Ralf had a problem, as far as I could see. They stayed out longer, meaning more fuel and longer pit stops."
Third was Michael's teammate, Rubens Barrichello, who beat the McLaren-Mercedes of defending race champion Coulthard by 0.7 seconds. Earlier, Coulthard received a 10-second stop-and-go penalty for speeding in the pits.
"The penalty ruined my race," he said. "It was a shame because we were competitive today, but I had to face the consequences of my mistake."
But the Scot's car was fast, setting a one-lap record for the race at 1 minute, 16.088 seconds. He was nearly a second faster than Nigel Mansell, who set the previous record of 1:17.070 in 1992.
Rookie Juan Pablo Montoya was in fourth place and ahead of teammate Ralf Schumacher when he was forced to quit after 52 laps.
"I think we had a problem with the engine as the lap before it started losing power and then it just died," Montoya said. "The main thing was being on a different strategy to Ralf and to try and beat him and I was ahead of him."
Coulthard's teammate, two-time F1 champion Mika Hakkinen, continued his run of bad luck, failing to start because of a gearbox problem.
"I couldn't believe it," Hakkinen said. "I just sat there while the mechanics were trying to get the car started.
"I'm disappointed, but things happen. It just seems they are happening to me more this season."
The Finn has completed only four races this season and compiled just nine points.
Jarno Trulli finished fifth in a Jordan-Honda, followed by Nick Heidfeld in a Sauber-Petronas.
TITLE: Wings Land Hasek as Free-Agent Market Opens for Business
AUTHOR: By Ira Podell
PUBLISHER: The Associated Press
TEXT: The Detroit Red Wings are counting on their newest player to take them deep into the NHL playoffs. The Colorado Avalanche are bringing back their Big Three to defend the Stanley Cup.
Shortly before the NHL's free-agent market opened Sunday, the Red Wings acquired star goalie Dominik Hasek from the Buffalo Sabres.
"An opportunity presented itself where we could acquire the best goaltender in the National Hockey League," Red Wings general manager Ken Holland said. "It was a deal that we just could not pass up."
The six-time Vezina Trophy winner was dealt to Detroit for Vyacheslav Kozlov, a first-round pick in next year's draft and future considerations. He agreed to an $8 million contract for next season and two option years at the same salary.
Colorado didn't need to look for help anywhere beyond its own dressing room Sunday.
The Avalanche re-signed captain Joe Sakic, defenseman Rob Blake and goalie Patrick Roy, arguably the three most attractive potential free agents, before they could seek offers from other teams.
"I know this will come as great news to our fans," Colorado GM Pierre Lacroix said. "Joe, Patrick and Rob are three of the premier players at their respective positions in the National Hockey League, and we are thrilled that they will remain integral parts of our team for years to come."
Sakic, a 31-year-old center, was the NHL's most valuable player last season. The 35-year-old Roy was the playoff MVP as the Avalanche won their second Stanley Cup in six years.
"In the end, Joe decided not to go to the free-agent market," his agent, Don Baizley, said. "He was happy in Denver and decided he didn't need to see what other options were available."
Sakic earned $7.9 million last season, Roy earned $7.5 million, and Blake made $5.267 million.
Blake was acquired from Los Angeles in February and liked Denver enough to sign on for more.
"To have athletes like Joe Sakic, Patrick Roy and Rob Blake commit themselves to this organization and market before having a chance to be an unrestricted free agent indicates how special they are and how equally special this city and hockey environment is," Lacroix said.
More money was available to sign the trio since free-agent-to-be Ray Bourque retired after winning his first Stanley Cup.
The Avalanche also decided to let free-agent defenseman Jon Klemm go. Klemm, a member of Colorado's championship teams last season and in 1996, signed with the Chicago Blackhawks.
The St. Louis Blues were busy Sunday, welcoming All-Star Doug Weight, acquired from Edmonton in a five-player deal, and saying good-bye to last season's leading scorer, Pierre Turgeon.
The Blues sent forwards Jochen Hecht and Marty Reasoner and defenseman Jan Horacek to the Oilers for Weight and forward Michel Riesen.
Turgeon, who had 82 points in the regular season, signed a five-year contract with Dallas. The Stars also agreed to terms on a three-year deal with forward Rob DiMaio, who left Carolina.
Edmonton couldn't afford to keep Weight, the team's leading scorer in seven of the last eight seasons, so they sent him to the Blues. St. Louis is one of Colorado's top challengers.
The Blues lost to the Avalanche in last season's Western Conference finals, one year after compiling the NHL's best record.
Weight, 30, has a five-year contract that will pay $9 million next year, more than double what he made last season.
The Blues also re-signed right wing Scott Mellanby, while the New York Islanders signed goalie Garth Snow. Both were two-year deals.
The New York Rangers signed a pair of defensemen, agreeing to terms with Edmonton's Igor Ulanov and Carolina's Dave Karpa.