SOURCE: The St. Petersburg Times
DATE: Issue #691 (58), Tuesday, July 31, 2001
**************************************************************************
TITLE: U.S. Worried by Russian Missile Test
AUTHOR: By Natalia Yefimova
PUBLISHER: Staff Writer
TEXT: MOSCOW - U.S. intelligence officials believe that Russia has test launched a new jet-powered ballistic missile intended to outwit the United States' planned system of defense against long-range missiles, The Washington Times reported Monday.
The report cited unnamed officials as saying that the launch of a refashioned road-mobile SS-25 intercontinental ballistic missile, known as the Topol, took place "from a launch site in central Russia two weeks ago." The missile reportedly landed on the far eastern Kamchatka peninsula.
The officials said the launch caught their attention because of the missile's unusual trajectory: The last stage flew within the Earth's atmosphere at an altitude of 30 kilometers - unlike the standard path of missiles, which tend to fly at higher altitudes. The lower altitude could be a technique intended to evade possible U.S. anti-missile defenses.
A spokesman for Russia's Strategic Rocket Forces said in a telephone interview Monday that there have been no missile launches "within the time period indicated in the [Washington Times] article." However, he declined to say when Russia last launched a Topol.
The Washington Times report cited U.S. officials as saying that the missile's last stage was a high-speed cruise missile.
"It looks like the Russians were testing scramjet technology," one intelligence official was quoted as saying.
Scramjet is short for supersonic combustion ramjet and refers to a powerful jet engine powered by a stream of compressed air that is forced out faster than it is taken in during a plane's forward motion. Combustion in a scramjet engine occurs at supersonic air velocities.
This technology allows vehicles to reach a speed five times the speed of sound - Mach 5 - or more, according to the report. It is lighter than a space-borne re-entry vehicle because it does not need to carry its own oxygen.
The Pentagon declined to comment on the launch report and details were scarce.
Moscow-based defense analyst Pavel Felgenhauer said the report left a multitude of questions unanswered.
"All that seems clear is that the Americans observed an unusual trajectory [for a familiar missile] and thought this might be a countermeasure in response to their missile-defense plans," Felgenhauer said in a telephone interview.
If the launch did in fact take place, Felgenhauer said, it is virtually impossible to establish whether the Topol had been equipped with some kind of engine, scramjet or otherwise. Theoretically, he said, it could have flown at a low altitude without an engine, in the manner of a glider.
Felgenhauer added that the Topol, which has a range of 10,500 kilometers and a maximum payload of about 1,000 kilograms, is too light to be used for lifting a large engine or a full-sized aircraft, and could only be used to test launch a relatively light model. Paradoxically, however, the Topol is also an optimal missile for Russia to use in such tests because it is still being produced, he said.
Felgenhauer added that various methods of eluding U.S. missile defenses - including maneuverable re-entry vehicles - were actively researched and developed in the Soviet Union in the 1980s, at the height of then-President Ronald Reagan's so-called Star Wars initiative.
Moscow has been an adamant opponent of Washington's push to develop missile-defense capabilities in violation of the 1972 Anti-Ballistic Missile Treaty, although President Vladimir Putin and U.S. President George W. Bush made some headway at the G-8 summit in Genoa, Italy, earlier this month when they agreed to link talks on defensive and offensive strategic weapons.
The Washington Times article noted that reports about the Russian launch were likely to draw intensified criticism from opponents of U.S. aid to Russia for dismantling its nuclear arsenal, while being allowed to continue developing new weapons.
The Associated Press reported that U.S. officials were to brief a Senate defense appropriations subcommittee in a closed session Monday on the accelerating U.S. defense program and the billions of dollars it will cost. The report said various options are under consideration, including a land-based system of 100 interceptors that would be based in Alaska and guided by a long-range radar station in the Aleutian Islands.
According to The Washington Times report, the United States is currently working on its own version of a hypersonic cruise missile that uses scramjet technology and will be capable of travel at speeds of Mach 5 or higher. A scramjet space aircraft is also being developed by the U.S. National Aeronautics and Space Administration.
TITLE: Chaos Surrounds Taxi Changes
AUTHOR: By Sam Charap
PUBLISHER: Special to The St. Petersburg Times
TEXT: An elbow to the gut. A shove from behind. A jab in the kidneys. A stomp to the toes. Public transportation in St. Petersburg has never promised much beyond wonderfully low fares. Sometimes it doesn't even promise to get you there.
But at least, generally speaking, you knew where you were supposed to be going.
That, however, seems to be changing, at least as far as the city's marshrutki, or private taxi-vans, are concerned.
Introduced nearly a decade ago, the marshrutki (literally, "taxi by route") have become a popular and convenient alternative to the city's overcrowded buses, trolley buses and trams. The price for a ride is about 8 rubles.
Recent initiatives by the City Transportation Committee, which oversees all public and commercial mass transportation, seem destined to mar the simplicity and convenience of the marshrutka system.
Until early April, marshrutka riders were able to distinguish among the vans by means of a fairly simple and straight-forward lettering system. Shuttles were labeled with a "t," and express routes had the prefix "e." In both cases, the letters were then followed by the route number.
Because all the marshrutki in the city were purely commercial operations, they frequently and unpredictably changed their route numbers. More importantly, they did not offer free or discounted services to the many groups entitled by law to subsidize transportation. These groups include pensioners, government workers, students and others. In all, there are about 2 million such people in the city.
To address these issues, the Transportation Committee decided this spring to hold a competition among the over 200 companies operating marshrutki in St. Petersburg. The winner of this competition, a company called Taxi 2, which operates the 416 route to Sestroretsk and the 161 route downtown, will be granted money from the municipal budget in exchange for agreeing to transport subsidized categories of citizens.
As a result of the competition, Taxi 2's routes will now carry only a route number, with no designating letter. All other marshrutki will have route numbers prefixed with the letter "k" for kommerchesky, or commercial.
So far, the result of these changes has been quite chaotic. The change has been complicated by the fact that an unusually large number of route numbers are also being changed.
As a result, many marshrutki, both commercial and the new non-commercial ones, have taken to displaying signs with two route designations - the old one and the new one - in order not to miss any business.
The Transportation Committee seems oblivious to the confusion that is being generated on the streets.
"The numbering system is constantly changing. The process of signing new agreements with [new marshrutka] companies [that appear on the scene] continues, and this process will continue forever," said the Transportation Committee's press secretary, Alexei Gerashchenko, in a telephone interview Thursday.
"New routes are being opened, and old ones are being changed," he added. He conceded, however, that it will take some time for the new changes to catch on completely.
"The numbering system is being unified to the K system. Over the course of the year, almost all [marshrutki] will bear the letter K. E and T will be phased out," he said confidently. "There will now be an ordered system. It will be more understandable for people."
People on the street seem inured to the chaotic numbering system generally and are not particularly fazed by the latest changes.
"I didn't notice any change. I just get on and that's it!" said Irina, as she waited for her marshrutka near the Mariinsky Palace on St. Isaac's Square.
Another passenger, Klara, took a more philosophical approach to the situation: "It's the same old situation. People here are always the last to find out about everything."
To avoid headaches, it may be advisable to pick up a new city transportation map, which are available at most newspaper kiosks in the city. According to Sergei Mikhailov of the Novoye Vremya publishing company which publishes the official city transport maps, a new map reflecting all the latest changes to the marshrutki-route numbering system will be available for sale by the end of this week.
TITLE: Putin and Kuchma Observe Navy Day
PUBLISHER: The Associated Press
TEXT: SEVASTOPOL, Ukraine - In a display of cordial ties, President Vladimir Putin and Ukrainian President Leonid Kuchma attended Russia's Navy Day celebrations Sunday in the once-disputed Black Sea port of Sevastopol.
The presidents watched a parade of Russian and Ukrainian military ships that formerly belonged to the Soviet Black Sea Fleet, an air show by Ukrainian MiG-29 and Su-24 warplanes, a paratroop jump and a rocket salvo against an imagined enemy.
Putin and Kuchma later visited the Moskva, the flagship of the Black Sea fleet's Russian portion, where Putin wished prosperity and happiness "to the people of Ukraine as a whole and Crimean residents in particular."
Ukraine and Russia argued for years over the future of Crimea, which only became part of then-Soviet Ukraine in the 1950s, over mainly ethnic Russian Sevastopol and over ownership of the Black Sea Fleet based there.
Sevastopol today serves as the base for Russia's part of the Black Sea Fleet, which the sides agreed to divide in 1997.
Still, some Russian politicians continue to argue that the historic port must belong completely to Russia. Among the dignitaries from both sides attending Sunday's event was Moscow Mayor Yury Luzhkov, who has enraged Ukraine with such statements.
Ties between Russia and Ukraine have been long troubled by these and other frictions, but achieved new warmth since Putin came to power. The summit Saturday and Sunday was the two leaders' second meeting in less than a week.
"We shall meet even more often," Putin said Saturday as he and Kuchma attended a ceremony for the consecration of a major and newly restored Orthodox cathedral in Khersones, near Sevastopol. The two leaders also visited a children's summer camp that day.
Putin and Kuchma are scheduled to attend an informal summit of leaders from former Soviet republics in Sochi next week, and Putin has promised to visit Ukraine next month for celebrations of its 10th anniversary of independence.
On Saturday, Kuchma said in Khersones that the Slavic peoples were united by Orthodox Christianity. "The event that gathered us will become an important landmark in Ukraine's history, in the history of the Orthodox people," he said in remarks cited by Interfax.
Putin said Christian principles bound Russians and Ukrainians together.
"In our unity is our strength," he said. "Such events that let us think and say that our countries and peoples have entered a new phase, one of creation, restoration and construction in the widest sense of the word."
Khersones' restored St. Vladimir Cathedral is built on the site where the Kievan prince Vladimir embraced Orthodox Christianity in the 10th century. The 19th-century cathedral served as a Bolshevik jail during Russia's civil war. It was closed by the Communist authorities in 1924 and ruined in World War II.
Dignitaries, including the two presidents' chiefs of staff, the head of Ukraine's pro-Moscow Orthodox Church and Russia's Communist Party chief Gennady Zyuganov, watched the ceremony, in which a cross crowning the 35-meter-high cathedral was consecrated. Hundreds of people gathered at the site chanted: "Russia! Russia!"
Putin left for Sochi on Sunday afternoon.
TITLE: Hanssen Monitored U.S. Peace Groups
PUBLISHER: The Associated Press
TEXT: LOS ANGELES - While former FBI agent Robert Hanssen was selling secrets to Moscow, he also was a key supervisor in a 1980s domestic program that questioned the loyalty of Americans in an effort to thwart Soviet spy activity, according to a newspaper report.
The program monitored peace and anti-nuclear activists and other groups that the White House worried could be manipulated by Soviet propaganda. Its stated goal was to uncover Soviet attempts at altering U.S. policy by influencing targeted groups.
Hanssen's initials appear on numerous files among 2,815 pages of formerly classified documents recently obtained under a Freedom of Information Act request, the Los Angeles Times reported Sunday.
"It's astonishing that the very guy who was going after dissenters was in fact working for the Soviets," said Michael Ratner, vice president of the New York-based Center for Constitutional Rights, a left-leaning political group that has been monitored by the FBI in the past.
As federal agents spent thousands of hours collecting political intelligence over a decade, Hanssen was giving his Soviet and Russian handlers a host of U.S. secrets on defense plans, nuclear weapons systems and American intelligence gathering.
In a plea agreement reached this month, Hanssen, 57, admitted to 15 criminal counts, including 13 of espionage and one of attempted espionage. Under the agreement, Hanssen will give a full confession of his spying activities in exchange for a life sentence without parole, thus avoiding the death penalty.
Hanssen's former boss, David Major, confirmed that Hanssen was "one of a handful of experts" on Soviet political-influence operations inside the United States. Major is retired from the FBI and works as a counterintelligence consultant.
Hanssen's assignment to the bureau's Soviet counterintelligence unit has been reported, but the documents disclosed in April show that he also was a key supervisor in the political intelligence operation.
Hanssen declined to be interviewed and the FBI declined to comment further about the confessed spy's activity within the bureau.
According to the files, the Soviet Analytical Unit would evaluate information collected about Soviet spies in the United States, analyze raw intelligence reports regarding alleged subversion and provide conclusions to the intelligence community and government officials.
Major said Hanssen, who was deputy chief of the unit from 1987 to 1990, "played a fundamental role in producing the final product. He was significantly involved in the process."
And even though Hanssen was not head of the unit, he often was left in charge when its chief was supervising other matters. Some documents confirm this by showing Hanssen signing off for his boss.
TITLE: Web Sites To Show Ministries Are Working
AUTHOR: By Robin Munro
PUBLISHER: Staff Writer
TEXT: MOSCOW - All federal government agencies must create their own Internet sites by the end of the year and should update them every day, Alexei Volin, deputy head of the government's staff, said Thursday.
If the Web sites are not updated daily, it will be concluded that the ministries or agencies have done nothing that day, Volin said in a telephone interview.
"The situation in which Moscow's professional prostitutes have their own Web sites and federal ministries do not is a little strange," he said.
Volin said the idea of putting all government agencies on the Internet had arisen in 1998, but the decision was made after a meeting in May between President Vladimir Putin and representatives of information-technology companies.
Of the 59 federal ministries and agencies, 24 already have their own Web sites, according to the government Web site www.gov.ru.
Although Russian politicians are fond of expounding on the joys and transparency of the Internet, some ministries have treated their activities as state secrets. That said, the Federal Security Service has a Web site, but the Defense Ministry and the Interior Ministry do not.
Volin said creating the Web sites would not be expensive and the ministries would get no extra funding.
"We won't give them a kopek. I am insisting that they have their sites working by the end of the year. Whether they do it by tender, by theft, whether they employ computer specialists or get their friends or acquaintances to do it, it's all the same to me," Volin said.
The government sites should contain all legislation the ministry or agency is involved in and all documents relating to changes to it, he said.
Viktor Bazhenov, director of the main computing center of the Agriculture Ministry who runs two sites for the ministry, said they are updated only twice a week, but daily updates are possible.
Volin said the government had no plans to punish ministries that do not update their sites every day. "I think that it will be in their interests to update regularly if they want the public to hold a good opinion of them," he said. "A minister will not like it if the media write bad things about him and he will pressure his subordinates to update his Web site."
Bazhenov said Volin's move was a step in the right direction, but the next step will be getting bureaucrats to think of the Internet as more than a toy or at best a means of communication.
"It seems they haven't understood the use of the Internet as a way of organizing ministries' operations, as a store of the ministries' knowledge base and as a means of making calculations," he said in a telephone interview.
Nikolai Danilov, spokesperson for Lebedev Studio, one of the country's biggest commercial Web designers, said there was too little information about the government's plans to say whether the studio would try to create some of the sites. Danilov said he doubted the ministries could all get their Web sites up and running by the end of the year.
Rambler president Anton Nosik saw Putin, Communications Minister Leonid Reiman and Economic Development and Trade Minister German Gref behind the move.
It is part of Gref's eight-year, $2.62 billion Electronic Russia program, which includes putting tax forms online and installing computers in schools and universities, he said.
Nosik said Kremlin insider Gleb Pavlovsky, who has provided content and design for several Internet sites, would likely play a role in creating the federal Web sites. Pavlovsky was not available for comment Thursday.
Nosik said the ministries could create a site for as little as $5,000 if open tenders are held.
"Without a tender, they could pay $5 million from every ministry's budget, and since every ministry has $5 million, if it is adequately shared between the ministry and whoever has to do the contract, then they could pay $5 million for a Web site," he said.
Asked if the call for daily updates was likely to produce more quantity than quality, Nosik said, "I like this idea; it's funny."
"You know, they all come from St. Petersburg and it was founded by Peter the Great, who decreed the everyday life of his subjects," he added.
TITLE: Visas Denied To NGO Employees
AUTHOR: By Nabi Abdullaev and Yevgenia Borisova
PUBLISHER: Staff Writer
TEXT: Petra Prochazkova, a former Czech journalist who runs two orphanages in Grozny, cannot get her visa to get back into Russia. She is not the only one.
Several foreigners connected with nongovernmental organizations - some active in Chechnya, others concerned with protecting the environment or promoting democracy - have been denied Russian visas in the past year or so. Most had been living in Russia for years.
The government's apparent reason for denying them visas is that it considers their work a state security risk.
"I am asking for the visa for the fourth month running," Prochazkova said in an e-mail message from Prague. "The Czech Foreign Ministry and President [Vaclav] Havel try to resolve my problem, but no success so far."
Prochazkova, whose husband is a Russian citizen, had been living in Russia for about 10 years and had reported extensively on both wars in Chechnya. Last year, she quit journalism to provide a home for 50 Chechen children who lost their parents.
She was expelled from Russia in February shortly after being questioned by the Federal Security Service in Nazran, the capital of Ingushetia.
Since 1995, Chris Hunter from Britain has headed the Center for Peacemaking and Community Development, a nongovernmental charity that runs schools for Chechen refugee children and offers psychological counseling to children traumatized by the war. He was forbidden to return to Russia after going to Britain for a vacation in March.
"No explanations on the visa denial were given to me, and actually I don't have firm reasons to seek political motives behind the authorities' decision to keep me out of the country," he said by telephone this week.
Tobias Munchmeyer, a German national with Greenpeace International, was denied a visa to enter Russia in December 1999.
"I connect the denial of a visa for me with my professional activities as an environmentalist who opposes nuclear contamination," Munchmeyer said by telephone.
Munchmeyer sought explanations from the Foreign Ministry and in two Moscow courts: the municipal court where the ministry is located and the city court.
"The judges referred to Article 27 of the federal law on the Russian Federation's entry procedures. The article permits the denial of visas on security motives. But how I can be a threat to Russia's security is what the judges failed to explain," he said.
He actually received his new visa on Dec. 28, 1999, in Berlin, but two days later he got a call from the Russian Embassy asking him to come in because of some bureaucratic problems. His visa was annulled.
Munchmeyer also has been blacklisted in Ukraine, which he discovered when he tried to visit his in-laws, U.S. News and World Report said.
An official in the Foreign Ministry, speaking on condition of anonymity, said decisions on visa denial are not made by the ministry.
"There is another organization in charge of that and you understand which one," he said, going on to make clear he was referring to the FSB. The official confirmed that CIS countries coordinate their visa decisions.
Although no explanation for denial is usually given, the usual reason is state security concerns, said Valentin Gefter, the head of Moscow's Human Rights Institute.
TITLE: Remembering the End of the Warsaw Pact 10 Years Later
AUTHOR: By George Jahn
PUBLISHER: The Associated Press
TEXT: PRAGUE, Czech Republic - The Kremlin's grip on East Europe was already feeble a decade ago. Still, Mikhail Gorbachev bristled when told Czechoslovakia was no longer a vassal state of the Soviet Union, President Vaclav Havel recalls.
"He was upset," the Czech playwright-turned-president said, chuckling as he recalled that meeting at the Kremlin with the Soviet president. "Then he said, 'O.K., you're a poet, you are allowed to put it that way."'
For Havel and other East European leaders who fought for an end to Soviet domination, this month brings back the July day 10 years ago when Havel chaired the Prague meeting carrying the Warsaw Pact to the grave.
Even before the meeting, the Warsaw Pact was a cripple. With Germany's unification, East Germany had ceased to exist, while other pact members - Poland, Czechoslovakia, Hungary, Romania and Bulgaria - had embraced democracy.
The pact's military functions had been dissolved. Still, signing the pact out of existence in Prague was an important reflection of how the threat of the Cold War turning hot was disappearing.
No longer were thousands of Soviet-built tanks ready to punch into Western Europe. Western capitals ceased being targets of nuclear missiles. The armored fist of the Soviet bloc, whose forces stood toe-to-toe with NATO in Europe since 1955, was no more.
Moscow remained a problem, but the Soviet Union's former European allies already had started clamoring for NATO membership.
Havel's country, now the Czech Republic after Czechoslovakia broke up in 1993, was among three former Warsaw Pact countries joining NATO in 1999.
Announcing the death of the pact at the Prague meeting, Havel recalls being suffused by "the intense feeling that I was party to a historic event."
Ferenc Somogyi, then Hungary's deputy foreign minister, spoke of a "very elevated mood" among the East European delegations after the signing.
But Czechoslovakia's anti-Communist Velvet Revolution, which led to the rapid democratization of civilian society, gradually spread within the Army as well.
Fewer people were attending communist political lectures that went on into 1990, and those who did grew critical. "In our group were some pilots, and they were very progressive," he said. "Toward the end, during one of those meetings, they slapped down their red Party books and proclaimed: 'We are leaving the Party!' Their courage influenced a lot of us."
The Prague summit was the culmination of other gatherings exploited by Havel and other East European leaders in their quest to end Soviet military dominance. Among those was the last meeting of the pact's political committee. Convened June 7, 1990, it was meant to discuss democratization, not dissolution, of the alliance, as part of reforms initiated by Gorbachev.
But Hungarian Prime Minister Jozsef Antall had other ideas.
With Antall chairing the meeting, he was responsible for announcing the agenda in the Kremlin's ornate main conference hall.
Participants recall the original plan: Antall, after consultations with Havel and Polish President Lech Walesa, was to suggest a slow dissolution of the pact. Instead, he unexpectedly called for its immediate scrapping. Clearly off guard, Gorbachev told him to repeat his suggestion, before waving his hand and responding with an imperious "Khorosho," or "fine."
His nonchalance was likely feigned, however. Somogyi, of Hungary, remembers a Soviet leader who had little choice but to go with the flow of the rapid democratization of Eastern Europe.
Sipping a beer in a room in his Prague Castle offices, Havel recalled other meetings that prepped the Soviet leader for the inevitable, among them their nine-hour encounter in February 1990, when Havel boldly proclaimed that his country was no longer a Soviet satellite. It was the first meeting between Havel, who spearheaded his country's fight against communism, and Gorbachev, the communist world's most powerful leader.
"Not only was I the first non-Communist president [in Eastern Europe] but a former dissident on top of that," Havel recalled. "Gorbachev until then had never seen a living dissident, and to him, I was some kind of exotic animal."
The atmosphere was initially oppressive.
"He looked at me at first with a great deal of caution, and we were not sure they were not planning to tie us up and bundle us away," Havel said.
Eventually Gorbachev loosened up, even allowing Havel, back then a chain-smoker, the privilege of lighting up in his chambers.
TITLE: Take a Good Look at Vyborg
TEXT: Just 120 kilometers northeast of St. Petersburg, the historic city of Vyborg is one of the treasures of the Leningrad Oblast. The Swedes began construction of a castle there in 1293, and the medieval fortress still dominates the old town.
Vyborg became part of Russia in the early 18th century when it was captured by Peter the Great. After the 1917 Revolution, Vyborg was part of Finland, until the territory was recaptured during the Winter War in 1939. Today, the city is a beautiful and bustling port, visited by 600,000 tourists a year. Convenient trains leave regularly from Finland Station. Photos by Alexander Belenky.
TITLE: Locals Join With G-8 Protesters
AUTHOR: By Irina Titova
PUBLISHER: Staff Writer
TEXT: Ten local residents who were among the protesters at the G-8 summit in Genoa, Italy, earlier this month complained that media coverage of the event was overwhelmingly negative and misrepresented the aims of the anti-globalism movement.
"There were about 300,000 peaceful demonstrators and just 500 so-called anarchists who kept destroying the city and provoking police to attack the peaceful participants," said Yevgeny Kozlov, head of the St. Petersburg Regional Communist Party (RCP), at the press conference held by the protesters on Monday.
Sitting in the small room that is the St. Petersburg RCP office against a backdrop of red banners and signs that they had brought back from Genoa, the anti-globalists enthusiastically shared their opinions with journalists.
The 10 local residents, who belong to a range of civic organizations and trade unions, joined Russians from Moscow and other cities to form a delegation of about 40 people.
"We went there to show that Russia will not stand aside from this problem, and to develop connections with the representatives of international movement," said Kozlov.
Mikhail Druzhininsky, a tram driver and head of the Tram Park No. 2 trade union, said he went to Genoa to learn how to fight for people's rights.
"Russia is a big and rich country, but we still lack the knowledge of how to fight for our rights," he said.
The protesters' travel was financed by the French anti-globalism organization ATTAC.
"If it wasn't for their financial help, we would never have been able to afford such a trip," said Tamara Vedernikova, head of the employees union at St. Petersburg Color Print.
All those who spoke at the press conference condemned the aggressive actions of the so-called "Black Bloc" of protesters.
"We saw Black Bloc people breaking store windows, turning cars upside down, building barricades from trash bins," said Igor Gotlib, a member of the left-wing democratic organization Alternativ. "You got the impression that all those actions had been scripted in advance."
Kozlov said that the actions of the Black Bloc seemed intended to discredit the entire movement.
Druzhininsky showed photographs of demonstrators and noted that they had tightly linked their arms to form a chain.
"We did that so that the aggressive intruders could not sneak in and throw [something] and provoke the police to attack," Druzhininsky said. He said their whole delegation received training from their French friends on how to behave in order to keep the situation safe.
The protesters noted that some authorities had floated the idea of holding a future summit meeting in Russia, arguing that it would be safer since Russia has a small number of anti-globalism activists.
"I'm glad to hear such news," said Vladimir Soloveichik, the deputy head of RCP. "It will be our pleasure to host our class comrades from the West here."
"But the capitalists will definitely be made to feel really uncomfortable here if they come. We'll organize the full range of protest actions," Soloveichik said.
The locals admitted that Russia has a relatively small anti-globalism community, but believe that it will grow as a result of their participation in Genoa.
" I think we'll attract people from trade unions into this movement," Vedernikova said.
The international anti-globalization movement opposes multinational corporations, arguing that their increasing financial clout allows them to circumvent the authority of national governments, endangering workers' rights, the environment and democratic political processes.
TITLE: Report Says the FSB Plans To Control the Economy
AUTHOR: By Yevgenia Borisova
PUBLISHER: Staff Writer
TEXT: MOSCOW - The Federal Security Service has drafted a plan that would give it enormous powers to control the national economy, two weekly newspapers reported.
The FSB, however, called the reports a "provocation." Analysts said the plan was unrealistic and "rubbish."
The plan was announced by FSB officer Yury Ovchenko, director of the Institute of Problems of Economic Security, at a briefing for a "closed circle of journalists" last week, according to Argumenty i Fakty, the biggest national weekly, and Obshchaya Gazeta.
The purpose is to "cope with the catastrophic results of the so-called reforms of 1992 to 1999" by reversing some "unlawful" privatizations and searching for money that has been spirited out of the country illegally, the reports said.
Furthermore, to prevent future capital flight, control over the Central Bank and State Customs Committee should be given to the FSB. And privatization results should be reviewed by the Security Council, which should be headed by someone from the FSB.
The measures are "absolutely legal" and are likely to be "extremely popular with the population," but even so, implementing them will require establishing state control over the main electronic media, the papers said, citing Ovchenko.
Perhaps in an effort to give the plan more popular appeal, it was presented as an attack on the oligarchs.
The plan includes replacing Prime Minister Mikhail Kasyanov with either Novgorod Governor Mikhail Prusak or former prime minister Sergei Kiriyenko, who now heads the Volga Federal District. Both, Ovchenko said, have already effectively "signed up" for the plan.
Representatives of both Kiriyenko and Prusak, reached by telephone, said their bosses have nothing to do with the plan.
The plan also calls for liquidating the Property Ministry and stripping the presidential administration, headed by Alexander Voloshin, of its political functions, the reports said.
Ovchenko said the plan was funded by a number of banks and large firms, Argumenti i Fakty reported. It is to be presented to President Vladimir Putin by fall, he said.
FSB spokesperson Andrei Laryushin said in a telephone interview that he had read the reports "with great surprise" and called them "a provocation whose purpose could be only speculated upon."
Laryushin said he personally checked staff records and even the archives, but could not find an officer Ovchenko. The FSB also has no links with the institute named in the articles, he added.
Moscow economists also said they had not heard of the institute.
Sergei Nikolayenko, a macroeconomist with Russian European Center for Economic Policy, said, "I know there is some analytical group with the FSB because one of my classmates disappeared there and since then no one knows anything about him.
"However, I don't think we should treat seriously articles in Argumenty i Fakty. It is yellow press and serious people don't read it."
Yevgeny Gavrilenkov, director of the World Bank-funded Bureau of Economic Analysis, said: "If something on such a scale is being prepared, it is normally not publicized in such a way. I haven't heard about such a plan, but I firmly know there is nothing impossible in this world."
Political analyst Yury Korgunyuk called the plan "complete rubbish" and "bureaucratic utopia."
"Look, the FSB is just really not able to control anything. The most they could is to turn off the oxygen for someone who has already lost all support, like [Boris] Berezovsky or [Vladimir] Gusinsky. But should they dare to pressure someone like [Alfa Bank head Pyotr] Aven or [Yukos head Mikhail] Khodorkovsky, everyone will see it as a terrible sign of a worsening of the economic climate in Russia."
Tatyana Netreba, who wrote the article for Argumenti i Fakty, said Ovchenko met with a few journalists at what she called the Kremlin-backed press club Chetyre Storony on Stary Arbat. Netreba said she had a strange impression of the briefing. "It just looked like someone in the Kremlin wanted to make this person consciously known to the public. Probably those who oppose the FSB team [close to Putin.]"
Ovchenko could not be reached on his mobile phone Friday.
Konstantin Preobrazhensky, a retired KGB officer, said in an interview he could believe such a plan exists, although it would be "very bad for the country."
Despite the denial by the FSB, he said, the plan could still have been leaked by the FSB to monitor public reaction.
TITLE: IN BRIEF
TEXT: Reporter Crackdown
MOSCOW (Reuters) - The army clamped down on reporters in Chechnya on Thursday for reporting too much bad news from the region and said it was setting up an alternative military broadcasting studio, NTV television reported.
The army decision to impose restrictions on the media came after Armed Forces Chief Anatoly Kvashnin criticized reporters Wednesday night in the town of Shali, 12 kilometers southeast of Grozny, for focusing purely on bad news.
"You are not doing a very good job, and therefore we have decided to set up two [media outlets] of our own," Kvashnin said.
"Why are you always so eager to report on military operations? You are working for the sake of war and we are working for the sake of peace," he said, urging reporters to talk more about the restoration of civilian life in Chechnya.
NTV showed Fyodor Asalkhanov, head of the Interior Ministry press center in Khankali, a major military base on the outskirts of Grozny, saying journalists would henceforth have to be accompanied by press-center officials.
Asalkhanov did not say who would decide what was newsworthy.
7 Vie for Duma Seat
ST. PETERSBURG (SPT) - Seven people have announced their candidacies to take over the Duma seat still left vacant by St. Petersburg parliamentarian Galina Starovoitova, who was murdered by unknown assailants in 1998, Interfax reported.
According to the agency, which quoted city Elections Commission spokesperson, Olga Titova, the seven are: trade union chief Alexander Popov; steel works chief and flamboyant politician Vyacheslav Marichev; Vasily Goryachev, a journalist with the newspaper Russian Land; the speaker of the national patriotic movement Great Russian Empire, Vasily Terentiyev; Vyacheslav Aleksandrov, a fourth-year student; Nikolai Ktruk, the general director of a company called Catherine the Great; and the unemployed Vyacheslav Terekhin.
The vote will take place on Oct. 14.
Forest Fire
MOSCOW (Reuters) - A raging forest fire Saturday threatened a radioactive-waste storage facility and forced the temporary shutdown of a nuclear reactor in the Voronezh Region, local officials said.
Fire experts said the blaze began dangerously close to a storage site for radioactive material and quickly took hold in the tinderbox conditions caused by the current heat wave.
Scores of firefighters battled for several hours to extinguish the blaze, which engulfed some 23 hectares, as it closed in on the Novovoronezhskaya power plant.
New Nuclear Sub
MOSCOW (AP) - Russia's new Gepard nuclear submarine has undergone final testing and will be handed over to the Navy in August, a shipyard spokesperson said Thursday.
Raisa Elimelakh said the Akula-class vessel returned to port Friday after successful sea tests. The Gepard is the first submarine built in the Severodvinsk shipyard since 1996, Itar-Tass said.
The Akula submarines are Russia's fastest and quietest, according to Russian news reports. The Gepard has a displacement of up to 12,770 tons, can submerge to a depth of 600 meters and can carry nuclear cruise missiles, Itar-Tass reported.
TITLE: Civil Airport Gets Smolny's Nod
AUTHOR: By Andrey Musatov
PUBLISHER: Staff Writer
TEXT: The city's Investment Tender Commission has given the initial go-ahead for territory on a military airfield in the suburb of Pushkin to be converted into a private airport, but the new facility's chances for success are still up in the air.
The development plan calls for the Ministry of Defense to hand over 48 hectares of land at the airport, which presently serves as a base for Russia's Sixth Air Army, to a private firm, Pushkin Airport.
The company will get the land for free, with the condition that it builds a civil-airport facility. Plans for the facility include the construction of the airport building itself, a business center, a cargo and import/export complex and refueling facilities.
According to Valery Chernyshov, the general director of the Pushkin Airport company, the exact cost of the project will not be known until the firm that will do the actual construction has been selected, but preliminary estimates by the firm have placed the price tag in the neighborhood of $10 million to $12 million.
In handling only private flights and helicopter service, Pushkin Airport will be going up against existing competitors as Pulkovo 1 and Pulkovo 2, St. Petersburg's main domestic and international airports respectively, already handle this business, as does Rzhevka airfield, which is located in the city's northwest.
Major General Gennady Torobov, the commanding officer of the 6th air army, told Vedomosti business daily that there were about 60 private planes operating out of St. Petersburg and the Leningrad Oblast, where there are also a number of small airfields. In the city, there are 27 airplanes operating out of the Rzhevka airfield and one at Pulkovo.
"Pulkovo airport is already able to handle the present volume of private flights," Alexander Shestakov, the head of the airport's air-traffic-control service, said Monday. "There are usually three or four private flights on working days and up to 10 on Saturdays and Sundays."
"There's still a lot of unused capacity here, so even if there's some growth in the future I doubt that the new airport will be able to compete."
Vladimir Molodnichenko, the general director of Rzhevka airfield, agrees.
"They're located vary near the Pulkovo airports, so I don't really see the point," he said Monday. "Also, it will be part of a grounds that still contains a military airport. That might cause difficulties for the businesspeople and international flights landing there."
But Chernyshov says the new airport will be completely different from the older ones.
"The main difference in the new airport will be that it will offer a full range of air services," Chernyshov said on Thursday. "Big airports, such as Pulkovo, don't care about private aviation.
"Rzhevka was huge in the Soviet period and handled millions of passengers. Now it handles private flights, but the airport consists only of a few hangars and doesn't provide any extra services."
Once Pushkin Airport receives final permission from the city administration, is planning to strike a deal with the adjoining military airfield to provide training and aid with technology in servicing the field's aircraft. He said that in this way the new airport would be able to help private individuals fly more safely.
"Right now Russian private aviation is entering a new era of development," he said. "Russian law permits private aviation, so anyone can have his own helicopter in his own yard, but the general lack of organization and services in the industry causes an unnecessarily high number of crashes."
But Rzhevka's Molodnichenko disagrees.
"We provide all the necessary services for planes and passengers," he said. "In all the time we've been operating here, we've never had a crash."
"But services and maintenance for private aviation are still very basic in St. Petersburg, because no one is paying specific attention to developing this market."
Kineks Invest, with 51 percent of all shares, owns a controlling interest in the new airport company, while Baltiiysky Aviafund with 39 percent and International Trucking Expediters Co. with 10 percent round out the ownership.
TITLE: Boeing Looks for Help In Battle With Airbus
PUBLISHER: The Associated Press
TEXT: MOSCOW - U.S. Commerce Secretary Donald Evans visited the Boeing aircraft design facility Friday, part of a tour focusing on ways to boost U.S.-Russian economic cooperation.
Evans and U.S. Treasury Secretary Paul O'Neill met with President Vladimir Putin last week to discuss economic reforms and possibilities for U.S. investment. After a decade of U.S. aid packages, U.S. President George W. Bush has called for focusing on investment instead.
With 650 engineers, the company helps combat Russia's brain drain by keeping highly qualified workers at home with well-paying jobs, the company's deputy chief Sergei Kravchenko told Evans as he took him on a tour of the design offices.
Kravchenko also appealed to Evans to use U.S. influence with Russia to help Boeing in its competition with European rival Airbus Industrie for aircraft supplies to state-run airline Aeroflot.
"Without high-level political help from the U.S. government, we can't compete with [French President Jacques] Chirac and [German Chancellor Gerhard] Schroeder, who bring Airbus contracts with them when they see President Putin," Kravchenko said.
Evans also toured the U.S.-Russian Mosflowline factory, which produces pipes for Russia's heating systems.
"[By] projects like this my optimism and hope is absolutely encouraged," Evans told company representatives. "Here I think we are establishing an atmosphere of trust [that is] the cornerstone to developing an environment for American investment and trade in Russia."
The Bush administration will send its first official trade mission to Russia in October and part of its task will be to boost cooperation with small- and medium-size businesses such as Mosflowline.
Meanwhile, O'Neill traveled to Nizhny Novgorod on Friday to look into the region's economic and investment potential, meeting with representatives of local banks, the U.S.-Russian Investment Fund and regional officials.
TITLE: Indonesia Mulling Fighter-Bomber Purchase
PUBLISHER: The Associated Press
TEXT: JAKARTA, Indonesia - Cash-strapped Indonesia is considering modernizing its Air Force by purchasing advanced Russian fighters, sidestepping a U.S. arms embargo, officials said Monday.
Air force chief Marshal Hanafie Asnan was quoted by the state Antara news agency as saying that his service wanted to buy an unspecified number of Sukhoi Su-30 fighter-bombers, considered to be one of the world's most advanced military aircraft.
"We are still studying the possibilities in view of our current economic situation," Vice Air Marshall Imam Wahyudi said Monday.
Indonesia is struggling to overcome a deep economic crisis and budgetary crunch and is hoping that the International Monetary Fund will restart a lending program that was shelved over a dispute about economic reform.
The price for a Su-30 Flanker is about $35 million per plane, defense analysts say. In Asia, only China, India and Vietnam operate the high-performance jets and Malaysia is considering purchasing a squadron.
Some previous proposals by Indonesia to buy Russian aircraft have fallen through because of financial constraints. However, Indonesia recently purchased thousands of Russian-made Kalashnikov assault rifles for use by its paramilitary police.
Ever since an abortive communist coup in 1965, Indonesia has relied heavily on Western countries - particularly the United States - for its defense needs. Its intercept-and-attack squadrons operate about 45 U.S.-made A-4 Skyhawks, F-5 Tiger II and F-16 Fighting Falcon jets.
However, Washington and European countries embargoed weapons sales to Jakarta after army-inspired violence in 1999 in East Timor, a formerly Indonesian-ruled territory that had just voted for independence.
Although the European Union has since lifted most restrictions, the United States retained its ban.
The Su-30 has a range of over 3,000 kilometers, which would allow it to patrol Indonesia's sprawling archipelago and neighboring parts of Southeast Asia without needing to be refueled in the air.
Its range and the ability to carry 8 tons of bombs could potentially cause concern to nearby states such as Australia, whose relations with Jakarta have been strained since it led an international peacekeeping force that ended Indonesian rule in East Timor.
Antara reported that a committee within Indonesia's Parliament had discussed the purchase proposal several months ago.
Indonesia is currently in political transition. President Abdurrahman Wahid, who tried to rein in the military, was ousted by the national assembly last week and replaced by Megawati Sukarnoputri, a nationalist leader who has forged close ties with the armed forces. She is expected to name a new cabinet, including a defense minister, this week.
TITLE: LOMO Wins Tender For Voting Machines
AUTHOR: By Andrey Musatov
PUBLISHER: Staff Writer
TEXT: Leningrad Optical-Mechanical Corporation (LOMO) is sticking with politics.
The firm, which manufactures a range of products including telescopes, devices for night vision and medical equipment such as microscopes and endoscopes, is aiming at supplying the Central Elections Commission (TsIK) with 30,000 vote-counting machines.
LOMO is one of Russia's largest optical-equipment manufacturers and, according to Alexander Dyadin, who heads its press service, the company was chosen in a tender announced by TsIK at the beginning of July. The firm, which also produces components for the Igla antiaircraft missile system, which provides a significant portion of its revenues, was one of two participants in the tender out of the original six that was able to meet all of the requirements.
Moscow-based Krok, a computer- and software-design company was the other.
The companies worked together previously in producing voting technology, as they supplied the TsIK with 1,300 machines in 1996. LOMO will undertake the present project alone, however.
"The earlier machines were used in 36 different elections and we never received any complaints about them. They always worked exactly as they were supposed to," Dyadin said Monday. "The new model weighs less, has stronger protection against power spikes and is able to process ballots an both A4- and A3-size paper."
The vote-counting machines are the size and shape of traditional ballot boxes. However, it contains an optical scanner that reads the box or boxes marked by voters as soon as the ballot is deposited. At the end of voting, it displays the totals on a self-contained screen.
The company also hopes that with minor technical adjustments the scanners could also be used for other purposes, such as processing the results of public-opinion or other surveys.
"Right now LOMO is producing the first three of these scaners in order to do testing," Dyadin said. "Based on the results and exsperiences from these tests, before the end of 2001 we'll produce another 50 scanners so that we can test them in actual elections somewhere in the regions. TsIk says that once it has checked these results, it will sign a contract with LOMO for the production of 30,000 devices from 2002 to 2004."
"Thirty thousand will probably not be enough to handle a federal election, but those areas zones with the largest populations will be well covered," he added.
LOMO, which is perhaps best-known for the simple, entirely manual cameras that have generated a cult of photographers who call themselves "Lomographers," has had significant contracts with the Russian government for military production, but has been strenghtening and broadening its range of civilian production.
The Bosi Financial Group, which is affiliated with the management at LOMO, is the nominal holder of the largest stake in the firm - 32.5 percent - while Cyprus-based KM Technologies and ACFI hold 19 percent and 10 percent, respectively. Both companies are controlled by New Programs and Concepts Holding, which integrates Russian companies working in the defense industry.
Dyadin refused to divulge the financial details of the deal, but did say that a price of about $1,500 for each machine was realistic, meaning the value of the entire contract would be in the neighborhood of $45 million.
"We view the program as both a significant state order and an effective way to raise our profile further," Dyadin said. "Each of the machines we produced of the older model bore our logo on the top cover, so each voter knew that it was made by LOMO."
TITLE: Deal With Guinea Covers Arms to Aluminum
AUTHOR: By Torrey Clark
PUBLISHER: Staff Writer
TEXT: MOSCOW - Russia signed military and other agreements with Guinea on Friday, reaffirming bonds with former Soviet allies in West Africa.
Guinean President Lansana Conte and President Vladimir Putin signed a wide-ranging declaration of friendship and partnership, covering issues from arms to aluminum.
Guinea, which is fighting Sierra Leonean and Liberian rebels along its southern border, is shopping for weapons, especially after an explosion destroyed a major stockpile of arms in March. "Our subregion is suffering more than a little since the beginning of the war between Sierra Leone and Liberia," The Associated Press quoted Conte as saying.
"[We want to] obtain a sufficient stock of arms to repulse and crush any rebel incursion [and] replace stocks of arms destroyed in the explosion at the Alpha Yaya arms dump," Reuters quoted a senior Guinean Foreign Ministry official as saying.
News agencies quoted Putin as saying, "We are aware of the difficulties faced by you, Mr. President, and your colleagues have good experience in cooperation, which has existed for more than 40 years."
The Soviet Union had a strong presence in Africa, aiding communist regimes in development in return for arms sales and access to natural resources.
The declaration of friendship signed by the two presidents also envisioned cooperation in bauxite and alumina production, Interfax reported.
According to local news reports, Conte's visit was sponsored by Russian Aluminum, or RusAl. Conte and RusAl CEO Oleg Deripaska signed an agreement Friday for the development rights to Guinea's coveted Dian-Dian bauxite deposit, according to a RusAl spokesperson, who declined to give details.
Analysts said the deal was good for RusAl as it has more production capacity than access to bauxite or alumina.
Guinea has about 20 percent to 30 percent of the world's known reserves of bauxite, the key raw material in aluminum production. Bauxite accounted for more than 90 percent of Guinea's $86 million worth of exports last year, Kommersant newspaper reported Saturday.
With 1 billion tons of high-quality bauxite ore with an average alumina content of about 50 percent, the Dian-Dian deposit is one of the world's largest, and negotiations to develop it have dragged on for years. Part of the plan, according to Interfax, is to create a single Guinean bauxite-alumina complex in a consortium with Kazakhstan, Ukraine and Azerbaijan. Such a project would cost an estimated $1.73 billion and would produce 11 million tons of bauxite and 1.2 million tons of alumina annually.
TITLE: Is There a Crisis in the Internet Economy?
AUTHOR: By Alexander Boreiko
PUBLISHER: Vedomosti
TEXT: Russian e-commerce is experiencing hard times. Internet projects have found it almost impossible to make a profit, and a large number have stalled or shut down altogether.
Boris Krasnyansky, a senior partner at the consulting firm PricewaterhouseCoopers, spoke about the reasons for e-business' present disappointment and the market's prospects. Krasnyansky was appointed PWC's head of management consulting in Russia in April and supervises the company's e-business work for the former Soviet Union.
Q: People have started talking about a crisis in the Internet economy? How did these problems in e-business arise?
A: Overall investor activity is falling. In the first quarter of 2001, venture capitalists invested slightly more than $10 billion. Of that, 75 percent, as in the past, was invested in Internet companies. When compared to the fourth quarter of last year, the volume of investment in the Internet fell by 43 percent. However, the general volume of investment by venture capitalists fell by 40 percent. This indicates the share of investment in Internet companies remained sufficiently stable. Accordingly, it would be wrong to attribute [the entire trend of falling investment] to Internet businesses. Moreover, investor behavior is cyclical and susceptible to trends. And even though investment activity has suddenly dropped, venture capitalists all over the world are now investing twice as much money as they did in the period preceding the Internet boom.
Q: All the same, you cannot deny that high-tech companies are experiencing very serious problems.
A: Certainly, a large number of Internet companies have gone bankrupt. Their capitalization was unjustifiably inflated. The fact that companies in the so-called new economy were worth tens of billions of dollars and consisted only of computers and manpower - insisting their primary resources were their clients - goes against logic. Those companies' valuations on the market were in no way connected with their profitability or even with predictions on the flow of investment, but merely reflected a gold-rush mentality among investors. The forecasts were beautifully written but were not in touch with reality. Investors overestimated the importance of e-commerce - that part of the electronic business connected with the sales, distribution and provision of products or services to the population. But e-commerce companies could not produce an income that met investors' expectations.
Q: Are consulting firms to blame for this? Why did consultants fail to advise their clients about the dangers of investing in the Internet?
A: One reason for this is that the price [for an Internet company] to become active on the market is sufficiently low compared to that for a traditional business. One well-known example of this is when a number of university students somewhere in California devised an ingenious plan, and within several months their capitalization totaled billions of dollars. Precisely because of the ease [involved in establishing an Internet company], excess supply appeared within a very narrow market. The market's inflated valuation combined with its trendiness and easy access led to a huge number of players.
As for the mistakes of consulting firms, I have never seen a consultant advise someone to invest in a purely e-commerce venture that bears no relation to the general context of e-business. No one was asking for advice. Everyone was too engrossed. The companies in the traditional economy waited it out. At the beginning of the boom, many of my colleagues noted the excessive and artificial growth of that market.
However, I'm now prepared to say the Internet has a great future as a medium for conducting business. The reason is that there is a difference between the concepts of e-business and e-commerce. E-commerce, or sales through the Internet, has limited application. At the same time, electronic business, solutions for the traditional economy with the help of the Internet, has only started to develop, although some large successful projects already exist in this area.
Q: For many users, the Internet is represented by the Web sites they visit most frequently. What are your predictions for Russian portals that are financed by income from advertisements?
A: The market for Internet advertisements is growing, but it is limited. We have three portals: Yandex, Rambler and Port.ru. Sometime this year, at least one merger or takeover should take place. By the end of the year, I don't think there will be more than two large Russian portals of that type.
Q: What is the future for shopping on the Internet?
A: Here we should look at what happened in America. The online bookstore Amazon.com started out with only Internet business. It bought a warehouse and later started to build other warehouses. Today, they have several warehouses in the United States and are building more in Europe. A successful Internet business transformed itself into a real business. I believe the same thing will happen in Russia. First of all, the development of traditional businesses is taking place with the help of the Internet, by adding Internet stores to existing services. At the same time, I know of an Internet store that is now considering opening brick-and-mortar stores. The reason is simple: investors don't anticipate future returns on the Internet. In that way Russia is following a global trend.
Q: Could a Russian e-commerce project break even?
A: If we are speaking about a store existing only on the Internet, consisting only of a server, software, programmers and clients, then I don't see how they could possibly break even.
Q: Which of the big names in Russian e-commerce will be able to survive the present crisis?
A: I believe only a few will be able to survive as independent businesses. I cannot give specific names here because not one Russian company has managed to grow to the size of Western companies such as eBay, America Online and Amazon.
The players who will survive are those who will be in some way connected with a traditional business, whether that is a store, production, or something else.
If a person were down to his last dollar, he'd be unlikely today to invest it in an Internet project. The Russian Internet economy follows Western trends, and everyone knows the level of investment in Internet solutions has significantly dropped. It is practically impossible now to find the additional millions needed to survive several more years if a company can't demonstrate positive cash flows.
Q: So in general, "everyone has died?"
A: The period of romanticizing the Internet has passed. Now it's possible to say things that would have been regarded as seditious in the past. The Internet is not a pot of gold, it should be looked on as a new instrument, new technology that can be used and is starting to be used by traditional companies to improve the operation of their primary business.
One of the most significant potential results of using the Internet is the fact that the consumer can be placed at the center of any business. The Internet is the best available technology for guaranteeing maximum consumer satisfaction, which makes the technology attractive from the point of view of distribution and marketing. For example, a business can independently carry out its distribution or supply with the help of Internet solutions, including e-procurement and e-sales.
On the other hand, the Internet makes it possible to establish vertical and horizontal trading premises, throwing out superfluous links in economic chains. In the same way, the company makes itself more transparent and simple.
TITLE: Gazprom To Weigh The Fate Of Purgaz
AUTHOR: By Yulia Bushuyeva
PUBLISHER: Vedomosti
TEXT: MOSCOW - A PricewaterhouseCoopers audit of Gazprom's relations with Itera has presented directors at the gas monopoly with a difficult question: Should Purgaz, which currently accounts for three-quarters of Itera's gas extraction, be returned to Gazprom?
The question is slated for discussion at Gazprom's next board meeting, scheduled for Tuesday.
Gazprom deputy CEO Alexander Pushkin has prepared a report for the board concerning the results of an investigation into the relationship between the two gas companies.
The report includes auditors' recommendations that Gazprom consider buying back the Purgaz shares it sold to Itera. "This recommendation will be approved at the board meeting on July 31," said a Gazprom executive who asked not to be named. "I doubt that the management will drag out the decision on the fate of Purgaz," he said.
Purgaz has a license to develop the Gubinsky deposit, with gas reserves of 381 billion cubic meters. In 1999, Itera extracted 3.8 billion cubic meters of gas from the deposit and 14 billion last year. In total, Itera extracted 17.9 billion cubic meters last year.
Purgaz supplies about 70 percent of the gas extracted by Itera, though initially it was a Gazprom subsidiary. Itera owned 49 percent of Purgaz, which it received in exchange for agreeing to develop Gubkinsky.
In 1999, however, Gazprom sold a further 32 percent stake to Itera for 32,000 rubles ($1,092), keeping a mere 19 percent. Purgaz, meanwhile, turned into Itera's main extraction enterprise.
PricewaterhouseCoopers says the gas monopoly could regain control of the Gubinsky deposit for a very reasonable price. Under the agreement, Gazprom can buy back 32 percent of the Purgaz shares at their face value of 32,000 rubles before Jan. 1, 2002.
The deal, however, only seems attractive at first glance. If Gazprom wants to get back what it lost, it must be prepared for serious additional expenditures. Itera had financed gas extraction mainly via credit schemes and is presently a major Purgaz creditor.
From 1998 to 2000, Itera gave Purgaz 6.5 billion rubles ($222 million) to develop the Gubinsky deposit. Of this, 4.2 billion rubles was provided in the form of loans and 2.3 billion rubles in promissory notes. Purgaz has returned 1.4 billion rubles to Itera, while the remainder will be due in the next three to four years.
The question of returning the assets has already taken on political significance, particularly since the change of leadership at the monopoly.
"If Gazprom decides not to use the option in regard to Purgaz, this will demonstrate that the new leadership of the company has no plans to stir up relations between Gazprom and Itera," said William Browder, managing director with Hermitage Capital Management Fund.
Earlier this month Browder's fund sent an official letter to two members of the Gazprom board - Boris Fyodorov and Ruhrgas head Bruckhard Bergman - requesting that the problem be resolved as rapidly as possible. Fyodorov has already applied to the Gazprom board requesting that the Purgaz issue be discussed at Tuesday's meeting.
Both Bergman and Itera declined to comment.
TITLE: Iraq To Increase Trade With Russia
PUBLISHER: The Associated Press
TEXT: BAGHDAD, Iraq - Iraq will boost its trade and oil contracts with Russia in return for Moscow's support in the UN Security Council, Iraq's deputy oil minister said in comments published Saturday.
"Owing to Russia's positive role in foiling the 'smart sanctions' proposal, Russian companies will be awarded contracts in the future in Iraq's oil, industrial and trade sectors," Deputy Oil Minister Faiz Shaheen told the Al-Ittihad weekly in an interview.
His comments show new warmth toward Russia on the part of the ministry. Previously it had criticized Russia for failing to implement contracts for the development of southern Iraqi oil fields.
Russia threatened to use its veto early this month when the Security Council was considering a plan to overhaul the United Nations trade embargo on Iraq - the so-called "smart sanctions" proposal. Finally, U.S. and British diplomats dropped the plan, and the council renewed the standard oil-for-food program, as Iraq wanted, on July 3.
The smart sanctions would lift most of the restrictions on trade with Iraq imposed after its 1990 invasion of Kuwait. But they would also tighten enforcement of the arms embargo and block Iraqi smuggling routes.
"Iraq will work to support the Russian economy in order to strengthen Russia's position against American and Western economic pressure," Shaheen said.
"We have dealings with Russian oil companies under the oil-for-food program and we expect them to increase vastly in the near future," he added.
The program allows Iraq to sell oil on condition the proceeds are spent on food, medicine and other essential goods.
During the past two years, Iraq has repeatedly criticized Russia and partly state-owned LUKoil for failing to develop its West Qurna field. Iraq even threatened to abrogate the contract awarded to the top Russian oil producer for the field's development, but it has not done so.
TITLE: IN BRIEF
TEXT: GECC Buy
STAMFORD, Connecticut (AP) - General Electric Capital Corp. is buying the commercial finance company Heller Financial Inc. for $5.3 billion in cash. Heller's shares leapt more than 47 percent.
The deal announced Monday would expand GE Capital's involvement in equipment leasing and real estate finance, which along with commercial finance are Heller's primary businesses.
The boards of directors of both companies have approved the agreement.
GE Capital, a diversified financial services company and subsidiary of General Electric Co., has assets of more than $370 billion with customers in 47 countries.
Heller Financial has nearly $20 billion in assets with clients in the United States, Europe, Asia and Latin America.
No Efficiency
BRUSSELS, Belgium (Reuters) - The European Commission said on Monday it had warned eight countries they were breaking a law requiring them to ensure car buyers can see the fuel efficiency of vehicles before they buy them.
France, Belgium, Germany, Italy, Greece, Spain, Portugal and Britain had failed to implement a 1999 EU law aimed at giving consumers information on car fuel use and emissions of carbon dioxide, the main "greenhouse gas" blamed for global warming.
"It is important for consumers to consider the potential environmental consequences of buying a new car," EU Environment Commissioner Margot Wallstrom said in a statement.
"I would urge each of these [EU] member states to make the necessary legal provisions as soon as possible." The countries have two months to reply to the warnings after which the Commission - the European Union's executive arm - can decide to take them to the European Court of Justice.
All EU countries should have implemented the law by January.
Smoking Reversal
LOS ANGELES (AP) - Philip Morris Co. is arguing that the $3 billion judgment awarded to a longtime smoker with lung cancer should be reversed because the judge refused to allow evidence of the smoker's criminal history.
A Superior Court jury last month awarded $3 billion in punitive damages and $5.5 million in compensatory damages to 56-year-old Richard Boeken. The verdict was the largest ever in an individual lawsuit against a tobacco company.
Boeken, a former oil and securities dealer who smoked for 40 years, claimed he was the victim of an industry campaign that portrayed smoking as "cool," but concealed its dangers.
During the trial, defense lawyers sought to tell the jury about Boeken's past run-ins with the law, including his involvement in the 1980s in a fraudulent oil and gas scheme. Boeken's lawyer, Michael Piuze, argued that his client's legal indiscretions had no bearing on the case and would prejudice the jury. Judge Charles W. McCoy agreed.
Bourse Buddies
JOHANNESBURG, South Africa (Reuters) - South Africa's Johannesburg Securities Exchange (JSE) said on Monday it had signed agreements with the London Stock Exchange that will enable members to trade key shares on both bourses.
The five-year deal, first announced in April, is also aimed at boosting domestic trading volumes in South African firms and to stem a recent tide of offshore listings in major blue chips.
Under the technology agreement, the LSE will provide its core SETS trading system to the JSE, as well as its information dissemination system (LMIL), the JSE said in a statement.
The technology services should be implemented by May 2002, the JSE said.
A second agreement provides for each exchange to help market the other's data, together with arrangements to aid cross-membership and the dual trading of securities, the JSE said.
Singapore Panned
WELLINGTON, New Zealand (AP) - The government indicated Monday it does not favor allowing Singapore Airlines to increase its stake in Air New Zealand, but a formal decision will be announced within a month.
Prime Minister Helen Clark told reporters that meeting Singapore Airlines' proposal to raise its stake in the national carrier to 49 percent remained very difficult.
Singapore Airlines, which currently holds 25 percent of Air New Zealand, is offering a capital injection for the ailing New Zealand carrier in return for the higher stake.
Singapore Airlines chief executive Cheong Choong Kong said last week it would not seek greater control over Air New Zealand, demand concessions in its operations, or covet more seats on its board.
"Well, 49 percent is 49 percent whichever way you read it," Clark said.
TITLE: City Bracing for Capital Invasion
TEXT: It's taken a while, but it seems that a nightmare for St. Petersburg firms is beginning to come true. The number of Moscow firms and interests coming north to compete in this market is picking up as big players in a number of different sectors are expanding their operations into the region.
This fact might serve as a sort of a wake-up call. As the Muscovites arrive with their deep pockets and rich aggressive attitudes, the days of the calmer - you could carry the nightmare analogy further and say "sleepy" - St. Petersburg market are numbered. Many of the city's businesses will have either to learn some quick lessons from their new competitors, or perish due to a lack of understanding.
Lesson No. 1: Money can buy you anything.
We will never know how much MDM-bank paid for the controlling interest in Petrovsky Narodny Bank or what kind of cash was thrown at Olga Kazanskaya by MDM to get her to jump ship at its main rival - Promstroibank - and take over as CEO of Petrovsky, but the sums were likely imposing for the relatively modest St. Petersburg market.
Presumably these expenses are not terribly taxing on the coffers of MDM, which is connected to the new-generation oligarchs Roman Abramovich and Alexander Mamut. MDM's activities in St. Petersburg have taken on a bit of a new-generation character, with the bank acting a bit like a spoiled, rich teenager in a department store, snapping up everything that strikes his or her fancy and caring little - if at all - about the price.
But the local financial scene is like a department store full of sales. The regional financial situation has only recently been revived after the crisis of 1998, and the number of heavyweight participants here is limited. Promstroibank is really the only institution here that could be put in the same weight class as MDM on the basis of its assets, which include not only financial wealth but also the political influence of its owner Vladimir Kogan, who is close to President Vladimir Putin. Menatep-SPB and Baltoneximbank may be large enough to play this new game as well.
But the aggressive expansion of MDM-Bank into the Northwest Region has already included the snapping up of a couple of small regional banks and, according to its management, is not yet finished. So other acquisitions probably lay ahead. There are a large number of smaller banks here just ripe for the picking.
At the same time,MDM group, which is connected with the bank, is doing its part and increasing its presence in the industrial sector by spending millions of dollars for the controlling stakes in local enterprises. Same story.
Lesson No. 2: Marketing, marketing and marketing (and more money!)
Moscow-based cellular operator MTS, which bought up Telecom XXI, the holder of the second GSM-standard license in the region, is moving in to compete with North-West GSM. Competition is not a word North-West GSM is particularly familiar with.
The most profitable part of holding company Telecominvest, it made sense for it to maintain high tariff rates and a very closed corporate structure for five years in a market it had all to itself. Now MTS, which is planning to provide service to its first St. Petersburg subscribers this fall, has already driven North-West GSM to spasmodic marketing efforts and new, cheaper tariff packages.
We'll see if it will be enough. The Muscovites have a lot of money and are ready to operate in the red for a period in order to win a market share.
Marketing comes into play here in two ways. First, is the obvious question of attracting subscribers. If both sides come in with low tariffs, it could end up a lot like a beauty show.
But how the companies are able to market themselves to investors and outside money may also matter. I can't really say that this is a strong suit for Telecominvest which, as mentioned before, is pretty much a closed shop. MTS, with American Depositary Receipts traded on the New York Stock Exchange, is already locked into reporting its every step.
Of course, this migration is not only a one-way affair. St. Petersburg's big players - like Promstroibank and Telecominvest - have also been keeping busy in expanding their presence outside the region, and they've met with some success.
But it appears that they will also have to start working on strategies to compete with the big boys from the capital or lose their own base altogether.
Anna Shcherbakova is the St. Petersburg bureau chief of Vedomosti newspaper.
TITLE: Power Sector Shedding Its Light on Result of Reform
TEXT: When you buy a refrigerator, the salespeople, if they are good at their jobs, will tell you just how long the particular model in question will retain the cold if the power goes off. And you don't have to be a resident of the Far East's Primorye Region to come across this phenomenon: Blackouts are spreading throughout the country.
There is, however, one consolation: We aren't the only ones.
When I first wrote about the problems in California on the pages of Novaya Gazeta, readers responded with letters of disbelief. Surely this kind of thing couldn't be happening in the United States? To this day some of them still don't believe it. Long before the difficulties in California, the same problems had occurred in Brazil. And they are very familiar to the residents of Kazakhstan. Everywhere the same thing happens: First the privatizations, the liberalization and deregulation of the energy sector and after a while - off go the lights.
In his capacity as the head of Russia's energy systems, Unified Energy Systems, Anatoly Chubais explains to his fellow citizens that the blame lies with thieving local officials and isolated errors. He also says the liberalization process hasn't been carried through to the end. If you hack up a company and sell off its most valuable pieces, then everything will magically sort itself out somehow.
One could say that, on a planet-wide scale, an expensive and not particularly successful experiment has been carried out. After all, the privatization and deregulation models differed for each country, as did the degrees of corruption. When I am told that Russian officials steal, I have no doubt whatsoever that this is true. But when I come to California, I also hear cries of foul play being directed against the directors of the energy companies there.
This is not a case of isolated errors or even the peculiarities of one model or another. If one and the same result is repeated in a number of different situations, then this means that the principle, the strategy itself, is bankrupt.
This cannot be avoided in Brazil, Kazakhstan or even in the United States. The difference is how society reacts. In Brazil, the electricity blackouts cause mass concern. In the United States, the claims against energy companies are being considered by the courts. And Russia? In the Primorye Region the governor, who had no direct connection with energy policy, has been fired and a replacement selected who is in no way better than his predecessor.
Basic common sense should tell us that running the national energy system like a small private business is no less foolish than incorporating a small shoemakers workshop into the centralized state planning system. But politics has no need for common sense - it has its very own interests after all. And that is why even a clear case of policy failure does not constitute an argument against the continuation of that very policy.
President Vladimir Putin tells the country that the previous years' reforms have failed to improve the lives of the population and that this is bad news. But then the authorities discuss a new packet of reforms that are founded on exactly the same principles as the previous reforms. You don't have to be a prophet to predict that if this program is implemented - for a second time - life will not get any easier or happier.
Chubais has expressed himself quite clearly: Those people and organizations that can't afford to pay for electricity must get by without it. And no one asks how prices are set, why wages are still miserly, and how, despite the low wages, our products are still not competitive. Alas, we don't hear any of these questions being raised, or any answers given at government meetings.
Boris Kagarlitsky is a Moscow-based sociologist.
TITLE: Business Gets Role in U.S.-Russia Dialogue
AUTHOR: By Don Evans
TEXT: A new chapter in the U.S.-Russian relationship opened last week as a senior team of Bush administration officials had two days of talks in Moscow aimed at cementing our economic ties for the long term.
To further our relationship, as President George W. Bush has suggested, it is important to get more American and Russian businesses involved in our bilateral discussions. Thus, we are supporting an initiative of the business communities in both countries to create an American-Russian Business Dialogue, which will provide a valuable means to improve communications between the business communities of the two countries and present a business perspective to the two governments. In response to this initiative, we announced Friday that the president has asked me to lead a business mission of American business owners to Russia in the fall.
To its credit, Russia has achieved a degree of macroeconomic stability and has adopted a more responsible approach to its international debt obligations. Much more needs to be done, of course, but a more favorable economic environment, a talented economic reform team and a cooperative working relationship between the Duma and President Putin have improved the prospects for further reform.
I believe we have a window of opportunity to build the U.S.-Russian economic relationship as recent market reforms by the Duma and President Vladimir Putin take hold, including reductions in business and personal taxes and a law allowing joint energy-production deals with foreign companies.
America is already Russia's No. 1 foreign investor with more than $5 billion in direct investments and $10 billion in two-way trade of goods and services. But these numbers are only a small fraction of what they could be.
Clearly, there are big challenges when doing business in Russia. For one, Russia needs to do more to build a better environment of trust at all levels. Trade missions are a good start, but new business opportunities don't translate into much if people don't trust the system enough to take advantage of them.
There must be courts, laws and regulations that are transparent, to attract foreign investors or create new businesses and new jobs. And ethical business practices and good corporate governance are vital.
The U.S. Department of Commerce has been working with Russia on many of these issues, developing codes of conduct and streamlining customs procedures. But much more needs to be done.
I hope the Business Dialogue can help build mutual knowledge and understanding between members of the American and Russian business communities. Participants in the dialogue can seek consensus on the development of institutions that must underlie trust in business relations, such as good business practices and corporate governance and effective mechanisms for resolving commercial disputes.
We are also working with Moscow as Russia seeks membership in the rules-based World Trade Organization. WTO accession would reinforce economic reform and rule-of-law initiatives in Russia's domestic economy. Of course, any WTO accession package will need to meet the appropriate commercial test, but the United States is prepared to continue working with Russia toward this important goal.
Trade and economic reform are, of course, about more than material wealth. They're a moral imperative, as President Bush says. They're about advancing democratic values and political stability, human freedom and social responsibility. The key to Russia's economic future is to unlock the potential of the Russian people, and this can be accomplished by strengthening the institutions that underpin democracy and the market economy.
Don Evans is U.S. secretary of commerce. He contributed this comment to The Washington Post.
TITLE: Readers Rally in Defense of Valery Gergiev
TEXT: World-Class Act
In response to "Number's Up for the Ruler of the Mariinsky," a column by Barnaby Thompson, July 20.
Editor,
If you compare the state of the Mariinsky opera and ballet companies to that of the Bolshoi, the reason there is a supremacy in St. Petersburg is due to the efforts of one man - Valery Gergiev.
His concern for the standards of opera and ballet places the Mariinsky at the very top of world companies. Almost all the cognoscenti in London devoted to Russian opera were agreed that they want to hear the Mariinsky in Russian operas. But this year, there was a number of other considerations involved: This is the celebratory year of Giuseppe Verdi and all international opera houses are vying with one another to do the most to indicate this. For the Mariinsky, whose singers regularly appear in opera houses around the world, it would have been a disservice not to have produced as many Verdi operas as they have. The fact that Verdi is highly popular with audiences around the world, and that the Mariinsky can perform his operas, was no doubt of great appeal to the Hochhauser company that brought the Mariinsky to London. This demand from abroad, one assumes, played a large part in the Mariinsky producing such operas.
Despite the highest prices ever for an opera company in London, the Royal Opera House - where the Mariinsky appeared - was sold out for every performance. That gives Valery Gergiev a real success in terms of the Mariinsky's survival. That the artistic considerations were challenged by newspaper hacks is not surprising.
Gergiev attempted to achieve an overnight miracle with Verdi operas, which was a bold move on his part in an area where opera directors usually have the luxury of a number of years to present productions that fail. A steep learning curve is what Gergiev has experienced, and he will no doubt approach matters of opera production in a different way in the future. As to Gergiev's limitations, they must be real, but who else could have pulled the theater and its companies from the abyss and ensured his survival through successful income from abroad and the acquisition of significant sponsorship? It is too soon to say Gergiev should go now, as Barnaby Thompson suggests.
In London, the Royal Opera House has experienced suicidal activities that have brought the theater to financial bankruptcy in real terms, and it has a decidedly precarious future. The Mariinsky, on the other hand, appears to have found a greater stability and still boasts both the best ballet company in the world and an opera company that has lost none of its stature by the so-called "production failures" of Verdi operas. To sack Gergiev now would be a disaster. To limit Gergiev's power in decision making may prompt him to leave the Mariinsky.
While the Mariinsky opera and ballet houses maintain the status that they do, no change for the time being is the best way forward.
Leonard Newman
London
Editor,
I read with great interest Barnaby Thompson's assessment of the Mariinsky and Maestro Valery Gergiev. I returned this weekend from London, where I went to see the company perform. In addition I have been reading Thompson's articles online now for quite some time.
I have been - and shall remain - a "Friend of the Kirov Opera and Ballet." What I am about to write is based on my own experiences and observations. My loyalty has been sorely tested by recent performances I attended, and the increasingly grotesque atmosphere surrounding the Mariinsky and their maestro. This loyalty has also been subject to ridiculous justification from those who should know better. You have given me a perfect opportunity to vent. I would enjoy hearing from Thompson himself.
The reason I chose to see the company in London instead of St. Petersburg is because my last trip three years ago was the worst kind of travel experience imaginable. A New York City-based tour operator planned the trip in conjunction with the now-defunct American Mariinsky Foundation. This "businessman" openly courted the wealthiest clients and flaunted his Mariinsky connections to his own advantage. He thought nothing of distributing the best tickets to these Americans, who for the most part knew nothing about the Mariinsky or Gergiev and couldn't have cared less. When I innocently inquired about the possibility of a backstage visit and/or rehearsal observation, this man yelled at me in the Astoria Hotel lobby in front of other guests and staff, thus making me a target for abuse. I watched on as the others were treated like honored guests in and out of a theater I love so much. Neither this man nor the foundation - now called Musica Russia - ever apologized or took responsibility for what happened.
The opera world operates under its own rules. Boorishness is considered an essential survival tactic. Because Gergiev is so powerful, he attracts the worst elements in classical music. His fan base is made up largely of Russians, some of whom feel they are the only ones who understand/appreciate/are worthy of the maestro's mission. Why? Because they have the loudest voices and resort to the most inappropriate behavior imaginable. I was once informed that I would never understand Gergiev's work because I was not from the Caucasus as he is. Why must the Mariinsky conform to an archaic, stupid theater tradition?
The performances I saw in London confirmed my growing suspicions of ineptitude at the Mariinsky. The texts of Shakespeare, Schiller, and the Catholic mass for the dead were left undiscovered by their interpreters. Didn't anyone among the Mariinsky staff, including Gergiev's sister, bother studying these essential primary sources along with the music? Production qualities are hard to criticize in touring productions, but there is no excuse for lack of preparation.
Then, there was the decision to use a black face in the minstrel show in Otello, which went way beyond any definition of political correctness. It was racist. Why didn't any of the Mariinsky's international partners (Alberto Vilar, the World Bank, etc.) take notice and make them stop?
All this is in marked contrast to Gergiev's recent work at the Metropolitan Opera. During the 2000-2001 season, he conducted The Flying Dutchman, The Gambler and Shostakovich's Fourth Symphony at Carnegie Hall. There is endless speculation regarding Gergiev's appointment as the Met's principal guest conductor, and one thing cannot be denied: The results are thrilling. The Gambler was an even more remarkable production than the earlier Queen of Spades. I sincerely hope Gergiev's handlers allow this collaboration to thrive.
Everything that has gone wrong for the Kirov at the Royal Opera House can be fixed. Being realistic about limitations is a good starting point. Any artistic institution is unworthy of serious interest unless it takes chances. I would never want to see the Mariinsky play it safe. Gergiev would then become another maestro on the international circuit conducting the same repertory. That would disappoint me more than anything else. However, if the untried is undertaken, then everyone, including Gergiev, should be made ready for the challenge.
Gergiev should concentrate on his own musical goals rather than concentrating on playing catch-up with the rest of the opera world. Because he is a profoundly gifted musician, the rest - rehearsal/preparation, production value, programming, casting, new funding sources, memorable live and recorded performances, an even larger world stage - will fall easily into place.
Until that happens, I wish he would conduct more Stravinsky.
Patricia Contino
New York City, New York
U.S. Doesn't Get It
Editor,
I am astonished at what my fellow Americans write to your newspaper about what they see as the friendly and warm attitude my government has toward Russia. They cannot understand why Russia objects to the new missile-defense system that President George Bush is trying to get into place. Also they do not see anything wrong with NATO moving right up to the Russian border.
Russia and the United States both signed the 1972 Anti-Ballistic Missile Treaty to prevent nuclear war by assuring mutual destruction if either party decided to launch a surprise attack. This system worked for several decades and will continue to work into the foreseeable future if left in place. If this missile-defense system is not aimed at Russia, then why doesn't America offer to do it as joint project with Russia? And if NATO is not a threat to Russia, why does NATO not want to let Russia join? I'm sure Russia would be a much stronger ally than the little countries that will join soon.
Can you imagine what the United States' attitude would be if Russia entered into a military alliance with Mexico, Canada or Cuba? The United States has not been attacked through any of these countries in recent history, but Russia has suffered millions of deaths from invasion through countries on its borders. Why is it so difficult for anyone to understand why Russia wants the countries it borders to be, at the very least, neutral?
Russia's path to security lies in close contacts with Europe and its Asian neighbors. The United States is not European or Asian, and its interests are not the same as Europe's or Asia's. Russia is both Asian and European. I hope someday the United States will realize that Russia wants to be America's friend, that it needs the United States.
The United States needs Russia, but it does not know this yet. Russia is by far the largest country in the world and its resources could fuel both its and the U.S. economy for decades to come. Also, Russia is by far the strongest possible ally that the United States would ever need. Don't forget, Russia might be economically weak right now and have many internal problems, but what other country can destroy the United States?
Roy Weaver
Kaliningrad
Editor,
I am a simple financial analyst and not a great expert in politics, but I think that the consequences of deploying a missile-defense system are dangerous and unpredictable. Who can guarantee that in several years, having built an anti-missile umbrella and being invulnerable, the United States will not want to put its forces into action and would not decide, for instance, to bomb Moscow to defend the rights of Chechens? Or Minsk? Or Kiev?
It is already clear that many countries will not be able to build their own missile-defense systems. By starting the buildup, the United States is challenging the rest of the world, it is provoking the buildup of new military technologies. The development of missile defense is the same as the development of new nuclear weapons because to build an efficient interception system, one has to have a radically more sophisticated technology than those needed to build nuclear weapons.
Nobody wants to find himself in the place of Yugoslavia or Slobodan Milosevic. Now, in order to feel secure, it will be important to have not just nuclear weapons, but an anti-missile umbrella as well.
Perhaps the ABM Treaty is outdated. But why not conclude another agreement without changing its founding principles? If the United States withdraws from that treaty, why shouldn't other countries violate the nuclear nonproliferation treaty? There is already a precedent: Israel. Why can some countries do it and not others?
At the moment, missile defense is still an intention. But it already exerts huge moral pressure. It is natural that the leaders of certain countries will do all they can - make their people starve, channel all their resources into armaments - but they will try to escape the fate of Milosevic.
Yes, perhaps the bombing of Belgrade and extradition of Milosevic will entirely change Yugoslavia for the better in several years. But to what degree has the goal justified the means? Who has the right to decide the fate of an entire nation, decide what kind of sacrifice can be made for the good of humankind? Or perhaps each country should pursue solely its own interests?
I would also like to remind you that in 1988 when Russia spent millions of dollars building a radar station in Krasnoyarsk, it was the United States that forced the Russians to dismantle it, saying it violated the ABM Treaty.
Ivan Danilkin
Moscow
Crisis in Indonesia
In response to "Megawati Installed as Indonesia's President," July 24.
Editor,
I would like to write down my opinion about my country, Indonesia, which is still in a political and economic crisis that began in 1997. I am an international-relations student at St. Petersburg State University. When I went home in January 2000, I saw for myself that most Indonesian people live poorly, are in bad health and cannot get a good education because it is just too expensive for them.
During my study in Russia, I've noticed a lot of things that are similar to my country. Western countries look on my country as an "emerging democracy," still recovering from the reign of the "dictator" Suharto. Jusuf Baharuddin Habibie then took power until a general election held in 2000. After that, Indonesia, a country with a population of 205 million, was led by President Abdurrahman Wahid. Habibie was not re-elected, because he was an inept and possibly corrupt politician.
In Russia, I have seen that the law means nothing and that freedom of the press is dependent on the president. Russians have a poor standard of living, cities have high crime rates. War is raging in Chechnya.
Indonesia is in a similar situation. You can buy any law you want if you have the money and the power. The reason is that people do not trust their leader, and that is very dangerous for a big country like Indonesia. Indonesia consists of 13,677 islands. More than 300 languages are spoken. Although about 78 percent of the population is Muslim and some people spend their money trying to create an Islamic state, Indonesia remains a secular country.
Since the 1997 crisis, almost 70 percent of the population lives in poverty. Can you imagine what it is like to live on less than $0.50 per day? And on top of that, they must watch as rich people drive around in expensive new cars and own huge houses.
As a result, crime is rampant. Stability is weakened. Politicians manipulate the poor to undermine one another and the government. Leaders inflame religions, ethnic and other passions in a dangerous game for their own ends. Indonesia may turn into another "killing field" like Cambodia or the Balkans.
Enough of saying bad things about my country. Now is the time to think about solutions. To the people of Indonesia, I would like to say, "stay calm, support democracy and support your country's leaders." To our leaders, I would like to say, "please show some concern for the people because they have suffered a lot from political games and they are so tired." And to foreign governments, especially the G-8, I would say, "please give more concern to my country. Don't think only about yourselves."
Hendra Manurung
St. Petersburg
TITLE: Strategic Flexibility
AUTHOR: By Thomas Graham Jr. and Damien J. LaVera
TEXT: SIX months into the new U.S. administration, it appears that the objective of the president's foreign policy team is nothing less than a foundational shift in the way the United States protects its security. Without defining its terms, administration officials - with support from advisers like Henry Kissinger - have urged the president to replace existing rules of international peace and security with a new strategic framework single-handedly.
For example, in his new book, "Does America Need a Foreign Policy. Toward a Diplomacy for the 21st Century," Kissinger says a reassessment of the concept of mutual deterrence is "long overdue" and should be replaced with some combination of offensive and defensive systems. His book, which, as Thomas Friedman of The New York Times noted, is intended for "an audience of one: President George W. Bush," appears to be something of a primer on foreign policy for the president.
The precise parameters of their new strategic framework are still unclear, but with the announcement of the Bush administration's NMD plan, some general themes are coming into focus. Mutual deterrence and the treaties that shaped it appear to be out. Gone is the era of negotiated security that brought about reductions in strategic nuclear arsenals, a build-down of conventional arms in Europe, and the network of agreements that successfully constrained the proliferation of weapons of mass destruction, in some cases for decades. Instead there is a new era of American flexibility devoid of unwanted constraints on U.S. behavior.
While the United States certainly must take steps to address new threats in an increasingly unstable and unpredictable world, unfettered flexibility is not the answer. Such an approach is destined to undermine U.S. and allied security because potential adversaries would also be freed from those same restrictions. Nevertheless, some people in the administration have set out to ensure a "strategic flexibility" based on the elimination of, among others, the Anti-Ballistic Missile Treaty. Based on the belief that deterrence should itself be replaced, some in the administration support abrogating the ABM Treaty and deploying any NMD system that can be fielded regardless of its effectiveness.
In our opinion, this mindset is troubling. An NMD system need not work at all to destroy the strategic balance if - as is likely - it provokes a destabilizing action-reaction cycle whereby, for example, China expands its strategic nuclear arsenal and accelerates its proliferating activities. Here, and perhaps with respect to Russia as well, the logic of deterrence will remain for the foreseeable future, something that Secretary of State Colin Powell has acknowledged in recent statements. Like it or not, so long as deterrence remains a factor, the ABM Treaty will remain relevant.
And the ABM Treaty is not the only target. The quest for flexibility also appears to mean looking for ways to scuttle the Comprehensive Nuclear Test Ban Treaty. These efforts are fueled by resentment of the restrictions the CTBT places on U.S. development of new nuclear weapons and concerns about verification.
The administration's approach to the CTBT is dangerous in both counts. President Bush has stated that the administration has no plans to conduct tests, but some envision a return to testing as part of an effort to develop nuclear weapons capable of destroying hardened underground targets while minimizing civilian casualties. The merits of this notion aside, rejecting the CTBT would permit our potential adversaries also to test nuclear weapons - weapons that could some day be used against American cities.
Absolute verification may not be possible, but our ability to detect nuclear tests in countries like North Korea would certainly be better with the treaty than without. Those concerned about North Korean missiles should contemplate North Korean development of nuclear weapons small enough to deploy atop those missiles. Since this would require nuclear testing, the CTBT - unlike an ineffective NMD system - could help protect against this threat.
But as troubling as we find the administration's rejection of existing treaties, the impact of its world view on prospects for future agreements may be worse still. Russia has made clear, for example, that the second Strategic Arms Reduction Treaty, which will reduce U.S. and Russian strategic nuclear arsenals from the START I level of from 6,000 to 6,500 warheads each to 3,000 to 3,500 - cannot come into play (and a START III cannot be negotiated) without the ABM Treaty.
Decrying what Kissinger, in his book, labels "the nit-picking detail that blighted previous arms-control negotiations," administration officials had first responded by professing a preference instead for unilateral reductions. This is no basis for stability.
If strategic stability is to be preserved, the U.S. must cooperate with its partners in security. Changes to the ABM Treaty should be done cooperatively and only after meaningful consultations with Russia, China and the allies. A hasty and ill-advised rejection of the CTBT should be avoided, and the ill-conceived notion of strategic flexibility should give way to a negotiated framework for verifiable and parallel reductions in nuclear arsenals.
Ambassador Thomas Graham, president of the Lawyers Alliance for World Security, served as special representative of the president of the United States for arms control, non-proliferation and disarmament from 1994 to 1997. Damien J. LaVera is the LAWS communications and programs director. They contributed this comment to The St. Petersburg Times.
TITLE: It Seems Like 1991 Never Happened
TEXT: NO doubt the "10th-Anniversary Story" will be a popular genre in the months ahead. The first volleys have already come across the wires in the form of articles devoted to the July 1, 1991, Kremlin meeting at which the Warsaw Pact was buried. Scribes around the world are already scratching away at stories on the 10th anniversary of the Aug. 19-21, 1991, coup attempt; the December 1991 meeting at Belovezhskaya Pushcha that effectively dissolved the Soviet Union; and the resignation of Mikhail Gorbachev later that month.
The old debates over whether Russia was reformed too much and too fast or whether reforms have had mixed results because too few were implemented too half-heartedly will be granted a new lease on life. Most of these arguments will certainly still be around when we mark the 20th and the 25th anniversaries as well.
This is not to say, though, that such discussions are not worth having and that they may not produce conclusions that could be useful even now. This could certainly be a good time for the West and the world to consider the different evolutionary paths of the countries of central Europe (including the Baltic states) and those of Russia and the rest of the former Soviet Union.
Why is it that the former countries have kept more or less on a straight path and are now well on their way toward European and global integration, while the former remain virtual outcasts, not only not integrated into organizations like the European Union and NATO, but without even the faint hope that they someday could be?
Is it not at least conceivable that if the West had, from the beginning, offered the same hopes of inclusion - even if they would take many years to be realized - to Russia, as it did to, say, Poland, then Russia's path toward democratic and open-market reform would have been much more linear and much more successful?
And how about the countries of Central Asia? Wouldn't they have made at least some progress toward democracy over the last decade if their peoples were convinced that the West viewed them as something besides obstacles to be surmounted in an effort to get access to Caspian Sea oil?
Now a decade has passed since the end of the Warsaw Pact. And the issues on the table are NATO expansion - how to isolate, not include Russia - and missile defense.
To a considerable extent, these are probably the same things we'd be chewing over even if the momentous changes of 1991 had never occurred at all.
TITLE: Journalism Has Earned Its Bad Reputation
TEXT: RUSSIANS are fond of the quip that journalism is the world's second-oldest profession. They enjoy making fun of the idea that it is possible to buy a journalistic point of view just as it is possible to buy various services late at night under the street lamps on Staro-Nevsky Prospect. A journalist's point of view, they say, is just like modeling clay in the hands of media owners or the authorities.
Unfortunately, there is too much truth to this image of Russian journalists, both in television and newspapers, private and state-owned. I remember noticing during this spring's NTV/Media-MOST controversy that some columnists who were cursing President Vladimir Putin as the events unfolded suddenly started praising the Kremlin as soon the takeover was complete. The whole incident merely reinforced once again the popular impression that journalists are merely tools in the hands of the rich and powerful.
I ran into this stereotype myself last week while working on a story about a company that claimed its interests had been damaged by certain authorities. One of the first questions that the company's representatives asked me was how much my story would cost them, as if my reporting on this conflict were some sort of advertisement that they should pay for.
"While trying to get someone to write our story, we soon realized that you have to pay everywhere for everything," said the company's representative.
When I said that we don't take money for stories, my interlocutor was surprised. His next question was whether or not we would run our story by City Hall for approval before printing. No matter how hard I tried, I couldn't make this person understand the difference between getting approval from the authorities and getting them to comment on the conflict since, after all, the authorities are a party to the case.
I told the whole story to a fellow journalist who was incredulous. "What did you do that for?" he asked. "If you had agreed, you would have gotten $1,000. Wouldn't that be good for you?"
Later, when I was speaking to one of the authorities involved in the conflict, he asked me directly "on whose behalf" I was talking to him. In other words, who ordered and paid for the story.
It is practically impossible to assure such people that there is no money involved in my reporting. The problem is especially tough for The St. Petersburg Times. In the past, I've had people tell me that I work for spies, that the paper is financed by the CIA, that my former editor works for MI-5, that right-wing parties give us money for our articles, that we are undermining President Putin's efforts to build a strong state, etc.
I've tried to talk to these people about objective journalism, but it doesn't work. The "prostitute" stereotype is just too strong, and media outlets that are far more prominent than The St. Petersburg Times just do too much to undermine my efforts. The press, sadly, is full of advertisements dressed up like stories and unsubstantiated stories based on leaks that are clearly organized for no other purpose than to destroy someone's political enemies.
Russian politicians seem to think that anyone not directly involved in politics is just too dense to tell the difference between truth and lies. But I know this isn't true. They see perfectly well how the media works. All they wonder is, how much does a story cost?
TITLE: Echoes Continue a Decade Later
AUTHOR: By Yevgenia Albats
TEXT: I have been waiting for a long time now to see exactly when the ill effects of the collapse of the Soviet Union would really begin to make themselves felt. And I mean "the Soviet Union," not Russia. After all, in Russia, a sort of modernized version of the Soviet Union - albeit on a lesser scale and with a more rational approach to economics - is already pretty well entrenched.
Consider the recent G-8 summit in Genoa and, especially, its telling silence on the subject of Chechnya. This group of politicians clearly sees things the same way that I do. Would you expect, for instance, Richard Nixon to start spouting off about democracy with his old ABM Treaty pal, Leonid Brezhnev? Of course not. You would expect them to stick to a strict agenda of security-related issues, leaving the chat about human rights to journalists and activists outside the hall. Serious people, after all, talk serious stuff. And that is what happened in Genoa and in the follow-up talks in Moscow last week.
But let's forget about Russia for a moment, just as the Group of Eight leaders did. What I am really interested in are the echoes of the Soviet Union, which collapsed seemingly into oblivion almost exactly 10 years ago. I can't help but hear these echoes in the noisy and violent protests that have become standard whenever the world's wealthiest countries get together to chat. First Seattle, then Davos, Prague, Davos again, Gothenborg and, now, Genoa. And I've probably even skipped over a couple of places where anti-globalization protests have taken place in the last two years.
The first protests of this type looked like good old hooligan fights that are familiar from the world of soccer. All in good fun, a few fans getting their noses bloodied and spending the night in the local jail until they sober up. But no longer.
In Genoa, one protester was killed and hundreds injured. And the level of protest was such that the assembled leaders could not ignore it, and most likely they even had trouble getting to sleep at night. Not that I worry too much about whether they slept comfortably or not. I just think that it is terribly ironic that the leaders of these eight countries must carry on their noble discussion of "the well-being of tomorrow's world" (sic!) from behind a barrier of police clad in riot gear and a system of specially built barricades. Obviously, some people aren't too thrilled with the new paradise our leaders are preparing to usher in.
But maybe this reaction was inevitable. Maybe the aftershocks of the collapse of the Soviet Union and, more importantly, the dashing of the age-old ideals of communism are finally just now being felt.
I've heard some analysts comparing the anti-globalization protests to those held by activists back in the 1960s. But I don't like this comparison. After all, the hippie movement was more of an individualistic protest of elite kids on university campuses. The protesters in Genoa and the other cities are a different breed. They aren't fighting for their right to smoke dope or even for better conditions for some less fortunate group in society. No, the anti-globalization protesters are fighting for themselves and for their own right to have jobs and live decently.
Somehow, the mere existence of the Soviet Union, with its blanket welfare state and its global propaganda portraying it as a country without inequality where ordinary people have power, absorbed leftist ideals during the 1970s and the 1980s. The endless cash flow from the U.S.S.R.'s Gosbank straight into the coffers of the world's communist parties did its job well. Those parties diverted leftist idealism out of the streets and into normal political campaigns.
But those days are gone for good and now the left wing has no serious, formal political channels for self-expression. And so, it is back out on the streets.
Of course, those who were marching in Genoa probably don't know or think much about the gulag or about the other miseries of life in the Soviet Uniion, but even if someone explained these things to them, it wouldn't make any difference. All they want is not to be on the losing side. And the snobby behavior of the G-8 leaders, with their minimal respect for humanitarian issues and their overemphasis on economic and security ones, just keeps making the protesters feel like losers.
Yevgenia Albats is an independent journalist based in Moscow.
TITLE: You Made the Rules, It's Time To Play by Them
TEXT: HERE'S an interesting Kremlin tactic: If an undesirable candidate has a chance to win election in a region where a presidential envoy is based, call the media and threaten, anonymously, to move the envoy to another region.
That's what happened this week. Interfax quoted an anonymous source in the presidential administration as saying that it could yank presidential envoy Sergei Kiriyenko out of Nizhny Novgorod if Communist candidate Gennady Khodyrev beats out incumbent Governor Ivan Sklyarov in Sunday's runoff.
The latest opinion polls show Khodyrev leading with 32 percent, about 10 percentage points more than Sklyarov.
While the threat would probably never be carried out even should the Communist win, the clear ploy to sway Nizhny Novgorod sympathies is disappointing.
Not only is the threat to move the envoy's office to picturesque but less important cities like Samara or Saratov, as the Kremlin source suggested, an unfair attempt to influence the vote, but the mere mention of such a move goes against everything President Vladimir Putin proposed last year when he redrew the country into seven super districts.
Putin at the time declared that the purpose of the districts was to introduce uniform laws throughout the country, restore the separation of federal and regional powers in accordance with Moscow's vision of federalism, and bring the Kremlin closer to Russians outside Moscow.
If that was indeed the goal, it should make no difference to the Kremlin who the regions pick as their elected officials.
When confronted with a question on whether the Communist Party has any future, Putin rightly said last week that it was not up to him to determine the future of a legitimate political party. He added that he would like to see the party adopt a modern social-democratic stance.
Moreover, Khodyrev, the region's perestroika-era leader and a former member of Yevgeny Primakov's cabinet, is not only respected in Nizhny Novgorod, but could well be one of the Communists who fit well into Putin's vision of the party's future.
The thinly veiled threat reported by Interfax undermines the goals Putin laid out for the super districts by suggesting they were set up on personal loyalties rather than on a legal foundation. The envoy's office is thus presented as another perk granted by the Kremlin to favored regions.
What if, in a bizarre twist of fortune, Moscow should elect an "undesirable" candidate as mayor in 2003? Would the Kremlin move the capital to St. Petersburg? Or would it pick Nizhny Novgorod, should the region vote non-Communist this time around?
This comment originally appeared as an editorial in The Moscow Times on July 27.
TITLE: Peterstar Pioneer Is Moving On
AUTHOR: By Sam Charap
PUBLISHER: Special to The St. Petersburg Times
TEXT: Rick Macy, a pillar of St. Petersburg's expatriate and business community, has fallen victim to an all-too-familiar fate: the seemingly inevitable bump up the corporate ladder to Moscow. As the commercial director of the telecommunications firm Peterstar and as chairman of the executive committee of the local branch of the American Chamber of Commerce, Macy has reached the top in St. Petersburg, apparently signaling to the corporate gods that he has outgrown the cultural capital.
But, as Macy explained in an interview on Thursday, he is less than ecstatic about his promotion. "I'm saddened to be leaving. I love Petersburg and I love Peterstar. It's so unique. I go to work every day with nice, talented people. It's fun. I live five minutes from the Hermitage. That's been an honor and a delight."
"In a way [the move to Moscow will be] interesting. It's new, it's different," Macy said. As of Sept. 1, he will be commercial director of Peterstar's Moscow-based sister company, Comstar. "But for the first six months, I will cry and scream. I'm going to hate it because I love St. Petersburg."
Macy's love for our city has translated itself into commercial success for Peterstar under his reign.
"I'm very proud that I've increased the customer base. When I started here three years ago, we had 26,000 installed phone lines. As I leave, we have 52,000," he said.
But Macy has given more than just more business to Peterstar, bringing with him the savvy and know-how of an experienced salesman and the discipline of a former U.S. Navy officer. "When I first got to Peterstar, if you asked, 'How many phone lines did we install today?' or 'How many customer complaints did we have today?' they didn't know. I put standards into the level of service given to you, the customer. If you've got a problem, we will respond to you in a certain period of time, as opposed to how it used to be. Before, if you had a friend in Peterstar, you got better service."
Macy, 36, got his start in the Russian telecommunications industry in the rough testing ground of Kemorovo, a city about 300 kilometers east of the Siberian city of Novosibirsk. He arrived there in October of 1996, and had only an accountant, a secretary, a license and a mission: to build a mobile-phone company from scratch. "It was the most empowering job I've had," he said. Within four months, Macy had secured the majority of the market share, becoming, in the words of one of his friends in the expat community here, "the cell king of Siberia."
But Macy has no monarchical aspirations. In fact, he sees his work here as an important factor contributing to Russia's development.
"The first time I came to Russia, I was in Nizhny Novgorod, and I watched a woman trying to send a fax. And she dialed a number and the fax wouldn't go. And she dialed again. She dialed it like 10 times. I thought I'd died and gone to hell. This woman can't send a simple fax. I feel something grand and noble about my work here. I'm helping Russians talk to each other, and that's good. If Russians talk to each other and have better communications, they'll make better decisions," he said.
Although he'll soon be vacating his post on the Neva, Macy expects to make frequent return visits with his wife, Svetlana, and his 10-month-old son, Nicholas. "How could you not?" he said.
TITLE: Pavlov Pays Tribute to His Canine Colleague
AUTHOR: By Robert Coalson
PUBLISHER: Staff Writer
TEXT: All too often, it seems, the animals that put their lives and dignity on the line for the sake of pushing back the frontiers of knowledge are quickly forgotten by history. Only a handful - such as Laika the space dog, Dolly the cloned sheep, or Koko, the gorilla who learned sign language - ever achieve the kind of prominence that their efforts merit.
To this list, however, one should add the creature depicted here, an animal known to history simply as "Pavlov's dog." This monument, located in the garden of the ominously named Institute of Experimental Medicine on the appropriately named Ul. Akademika Pavlova, actually salutes not just the dog who famously learned to salivate whenever a bell rang, but all the forgotten four-legged heroes of experimental medicine.
Perhaps more interestingly, the idea for the monument came from Pavlov himself. The great physiologist also approved its design in 1935 and wrote the moving inscription: "Although the dog - helpmate and friend of mankind since prehistoric times - may be sacrificed for science, our dignity demands that it be done only if absolutely necessary and without needless suffering. I. Pavlov."
Although Ivan Pavlov was born near Ryazan in 1849, his life and career are intimately associated with St. Petersburg where he lived from 1890 until his death in 1936. In addition to his studies of conditioning in animals, which were summarized in his 1926 treatise "Lectures on Conditioned Reflexes," and which served as the foundation of behavioral psychology, Pavlov conducted innovative research on circulation and digestion. He won the Nobel Prize for Physiology (now, Medicine) in 1904.
If one takes memorial plaques as the measure of distinction, Pavlov is among the most honored people ever to have lived in St. Petersburg. In addition to a plaque just a few steps away from the monument pictured here at the Institute of Experimental Medicine he is remembered at 1/2 Nab. Leitenanta Shmidta, where he was living when he died.
He is also commemorated at the Military Medicine Academy at 10 Ul. Komissara Smirnova and at 18 Bolshaya Pushkarskaya Ul. Finally, there is a plaque commemorating Pavlov at the Pavlov Institute of Physiology at 6 Nab. Makarova.
TITLE: Incognito King a Real Man of the People
AUTHOR: By Jamal Halaby
PUBLISHER: The Associated Press
TEXT: AMMAN, Jordan - In his latest undercover expedition, Jordan's king disguised himself in old clothes and slipped out of his hilltop Amman palace to find out how his subjects are treated at the tax department, officials and a newspaper reported Monday.
King Abdullah II, 39, has become known for such exploits since ascending to the throne after the death of his father, King Hussein, in February 1999. On previous occasions, he posed as a television reporter, a taxi driver and an old man.
In the last year, there has been little news about Abdullah venturing out in disguise, but palace officials say the trips have not stopped. They say the monarch has tried to keep a low profile as he assessed the efficiency and level of bureaucracy to be found at government offices in Jordan.
This time, Abdullah, sporting a white beard, wore shabby white Arab dress and a traditional headdress. He was accompanied by his half brother, Prince Ali, 25, who is in command of an elite force in charge of the king's security.
At Amman's Income Tax Department, Prince Ali submitted a form claiming a tax return, said officials at the department. It was not clear what name Ali used on his form.
Al Arab al Yawm, a liberal Jordanian daily, said the king asked department employees to review Prince Ali's application, which was done, and that he mingled with people in the line behind him.
Income tax workers realized they'd had royal visitors only when the pair left the building and drove away in a motorcade complete with Royal Palace security jeeps and wailing sirens. The king and prince had arrived more quietly.
Palace officials declined comment.
The king-in-disguise ploy recalls the populist touch of King Hussein, who often mingled with his subjects. But Hussein's disguises were usually no more elaborate than the end of a headdress draped across his bearded face.
Abdullah's forays have combined secrecy with a deft touch for publicity. Often palace officials do not know about such trips until the king himself talks about them.
TITLE: WORLD WATCH
TEXT: Death of Gierek
WARSAW, Poland (AP) - Edward Gierek, the Communist ruler who pushed for reform during the 1970s but was forced from power over mounting debt and strikes, has died. He was 88.
Gierek became Communist Party chief in 1970, promising openness to the West and internal reform. He launched a program to modernize outdated Polish industry. He encouraged foreign investment and took multibillion-dollar credits from the West. But much of the money was squandered in ill-fated projects. Rising prices, deteriorating living standards and human rights violations sparked dissatisfaction and strikes in 1976 and in 1980.
Gierek was forced to resign in the fall of 1980 after the anti-Communist protests that gave birth to Solidarity, the Soviet bloc's first independent labor federation. Communist leaders blamed Gierek for Poland's woes and revoked his party membership. Gierek was jailed after his successor, General Wojciech Jaruzelski, declared martial law in 1981.
No Saadawi Divorce
CAIRO (Reuters) - A court has thrown out a petition by an Islamist lawyer who sought to divorce outspoken feminist Nawal el-Saadawi from her Muslim husband on the grounds that she had abandoned her Islamic faith.
On Monday, the court ruled as expected that no individual could petition a court to divorce another person forcibly. It said such cases must be raised by a state prosecutor. "My husband and I are very happy. But we feel the case should have been rejected by the court from the very beginning," Saadawi said.
Lawyer Nabih al-Wahsh had claimed 70-year-old Saadawi had shown she was no longer a Muslim in a newspaper interview earlier this year, which he argued meant she should not be allowed to remain married to her Muslim husband. In the interview, Saadawi said the rituals in the Muslim haj pilgrimage had pre-Islamic origins. She also called for sexual equality in Muslim inheritance laws.
Foot-and-Mouth Scam?
LONDON (Reuters) - Britain's government said on Monday it was investigating an allegation that a farmer had been offered animals infected with foot-and-mouth to spread the disease to more livestock and claim compensation.
A spokesperson for the Department for Environment, Food and Rural Affairs said officials were investigating one case, but there was little evidence to support other reports of people offering infected sheep for sale to disease-free farms. "We are investigating one allegation but we can't give details about it for fear of prejudicing the process," the spokesperson said. "We've been aware of such rumors of self-infection for some time. But most have been anecdotal and we have no real evidence."
Farmers have reported receiving calls from men offering infected livestock or parts of animals to enable them to get compensation payments for their flocks or herds almost since the start of the foot-and-mouth outbreak in late February.
Swiss Army Plan
BERN, Switzerland (Reuters) - Swiss Social Democrats demanded an end to Switzerland's tradition of mustering a huge militia army on Monday, and said a smaller force of volunteers would better serve the neutral country.
The Social Democrats sought to slash the country's defense procurement budget by two-thirds given the increasingly unlikely scenario of a direct assault by an enemy. But they stopped short of calling for a professional army, instead favoring limited enlistment periods for young men and women to serve up to seven years.
It said a standing force of 15,000 backed by 45,000 reserves would suffice to defend the Alpine country and its borders and join international peacekeeping missions. This is below the 120,000-man army the government has proposed and a mere shadow of the current 360,000-strong army in which practically every able-bodied Swiss man serves, an assault weapon tucked under his bed at home.
Racism Talks Appeal
GENEVA (AP) - The top UN human rights official kicked off a final attempt to set up the World Conference Against Racism with an appeal Monday to Arabs to discard attempts to vilify Israel. The United States has threatened to boycott the conference over the issue.
Mary Robinson, UN high commissioner for human rights, said delegates preparing for the conference starting Aug. 31 in Durban, South Africa, should drop wording from a draft document seeking to equate Zionism with racism.
"The United Nations has already dealt with this issue at great length," she said, in a departure from her prepared text. It took the United States and Israel until 1991 to get the UN General Assembly to repeal its 1975 resolution against Zionism, the movement that led to the re-establishment and support of a Jewish homeland in biblical lands.
"I am acutely aware of the suffering of the Palestinian people and dismayed at the continuing toll of deaths and injuries on a daily basis," Robinson said. However, she added, "I believe that it is inappropriate to reopen this issue in any form here and that anyone who seeks to do so is putting the success of the Durban conference at risk."
Typhoon Kills 32
TAIPEI, Taiwan (AP) - Typhoon Toraji churned through Taiwan on Monday, cutting power to thousands of homes, canceling international flights and killing 32 people in mudslides and flash floods.
By Monday morning, Toraji had weakened into a tropical storm as it whirled over northern Taiwan at 17 kilometers per hour and headed for southern China, leaving a trail of uprooted trees, crushed homes and submerged cars.
Toraji slammed into Taiwan overnight, causing landslides and flash flooding in the east-central county of Hualien, about 160 kilometers south of the capital, Taipei, the national disaster relief center reported. Dozens were reported missing.
Is Nothing Sacred?
JERUSALEM (AP) - To the dismay of Jewish religious groups, city officials in Israel's largest city allowed restaurants to remain open Sunday rather than forcing them to close in observance of a holiday marking the destruction of the biblical Jewish temples.
In previous years, municipal inspectors in Tel Aviv fined restaurants that opened on the Tisha B'Av day of fasting. Tisha B'Av, or the ninth of the month of Av, is the date observant Jews believe the temples were destroyed in the years 586 B.C. and 70 A.D.
But Tel Aviv's secular leaders permitted restaurants to open Sunday. They cited a a bylaw that orders places of "entertainment" to remain closed, but the law does not mention restaurants.
Yossi Sarid, head of the secular Meretz party, told army radio that "the secular community is fed up" with religious groups dictating rules and regulations. But Israel's Chief Rabbi Meir Lau denounced the decision as "awful, disgraceful, regrettable and troubling."
TITLE: Agassi Retains No. 1 Ranking
AUTHOR: By Beth Harris
PUBLISHER: The Associated Press
TEXT: LOS ANGELES - Andre Agassi continued his recent domination of Pete Sampras with a 6-4, 6-2 victory Sunday in the Mercedes-Benz Cup final - his most lopsided win in two years over his rival.
Agassi trails 17-14 in the 12-year rivalry, but he's won the last three meetings, including a three-set victory on hardcourts in Indian Wells in March.
"You wake up differently when you play him in a big match," Agassi said. "It brings out the best in my game."
While Agassi leads the ATP in points and money, Sampras hasn't won a tournament since capturing his seventh Wimbledon crown last year. He was upset in the fourth round this year by Swiss teenager Roger Federer.
Sampras is 22-12 this year, and has gone 14 tournaments without winning a trophy - the longest since he won his first ATP Tour title in the 34th event of his career in 1990.
Agassi won 10 of the final 12 games as Sampras struggled to serve into the sun. Although Agassi faced the same condition, Sampras said, "It's a bigger deal to me because my serve is such a big part of my game."
Sampras got broken twice in the first set, including once on a double fault - one of seven that offset his nine aces. He connected on just 54 percent of his first serves in the match, compared to 80 percent for Agassi.
Agassi saved three break points to even the second set 1-1. He broke Sampras in the next game that went to deuce five times. Twice Agassi smacked forehands down the line to go up 2-1.
He broke Sampras with a backhand for a 4-1 lead and then Sampras committed four backhand errors to trail 5-1 before Agassi served a love game to close out the 1 1/2-hour match.
"I tried to get to his backhand as much as possible," Agassi said. "His backhand is definitely the weaker of the two sides."
Agassi hadn't beaten Sampras so convincingly since a 6-2, 6-2 victory in the season-ending round-robin championship in Germany two years ago.
The victory solidified Agassi's lead in the ATP Champions Race, which determines the world's No. 1 player at year's end. He will remain on top with 609 points on Monday.
Agassi also overtook Gustavo Kuerten as the ATP money leader with $1,690,896, including $54,000 for his fourth title of the year.
Sampras will move from 20th to 17th in the points race after making just his second ATP final of the year.
The match was stopped for three minutes with Agassi leading 3-1, 30-15 in the second set when a spectator fainted in the stands. The man was revived and walked out under his own power.
TITLE: Aussies Steal U.S. Swimming Crown
AUTHOR: By John Pye
PUBLISHER: The Associated Press
TEXT: FUKUOKA, Japan - Behind the efforts of Ian Thorpe, Australia clinched the No. 1 spot at the World Swimming Championship on Sunday with a world record and a stirring relay win.
Thorpe watched with his teammates from the bleachers as Grant Hackett got Australia's 12th gold medal and Petria Thomas led the women's 400-meter medley relay to her third gold medal and Australia's 13th.
The U.S. team that dominated the world championship in 1988 and topped the Sydney Olympic standings with 33 medals, including 14 gold, wound up with nine gold and 26 overall to finish behind Australia (13-4-6) and China (10-6-4).
"The Americans have been No. 1 for a long time and I'll make no bones about it, we want to beat them and we did just that," said Australia's head coach Don Talbot. "It's fabulous and it makes me feel great."
China's last campaign in Perth was plagued by the drug scandal surrounding its female swimmers, but its divers restored some dignity this time.
Olympic champion Tian Liang clinched victory with a high-scoring final dive from the 10-meter platform, giving China its eighth diving gold.
Canada's Blythe Hartley and Russia's Dimitry Saoutine were the only divers to break China's monopoly of the 10-event program.
Thorpe accounted for almost half of the Aussie gold, but said he was more happy about achieving a personal best in every single race - the 100, 200, 400 and 800 freestyle and three relays - than he was about becoming the most dominant swimmer at a world championship.
That's no mean feat when you've notched 12 individual world records.
The 18-year-old Australian was the first to win six golds at one world championship. He went one better than Jim Montgomery, who got five in 1973, and Tracy Caulkins, who had five in '78.
Eight world records - all in the men's program - fell in the temporary plastic pool inside the Marine Messe.
"I think that as long as I can continue improving in training, I'll do the same when I compete," said Thorpe, voted swimmer of the meet. "I've just completed my most successful international meet, so I hope that I can continue the momentum I've gained here."
Hackett says he can go faster too.
"I think I can take it down even more," Hackett said after winning the 1,500-meter freestyle in the world-record time of 14 minutes, 34.56 seconds, knocking 7.1 seconds off the 7-year-old mark set by another Australian, Kieren Perkins.
The world records certainly will remain pool records. Workers began dismantling the pool barely an hour after Hackett had emerged from the shadows of Perkins and Thorpe, who had beaten him to golds in the 400 and 800 earlier in the program.
The electronic timing devices that misfired and forced judges to resort to backup videos 16 times were among the first items gone. And good riddance, according to most of the swimmers.
Inge de Bruijn almost singlehandedly elevated the Netherlands to seventh in the standings, winning three world championships in the 50- and 100-meter freestyle and the 50-meter butterfly.
"I didn't think I would win three golds, but I was kind of hoping for it," said de Bruijn, who had three Olympic gold medals and four world records going into the meet, but had never owned a world championship title.
Ukraine's Yana Klochkova, winner of both women's individual medleys at the Sydney Olympics, won two golds, the 400-meter freestyle and the individual medley over the same distance.
Without Lenny Krayzelberg, Gary Hall Jr., Tom Dolan, Jenny Thompson, Dara Torres, Brooke Bennett and Misty Hyman - and with Lindsay Benko smashing her kneecap while slipping into a pool in practice on the eve of the meet - the American team was its most inexperienced in years.
But it unearthed some talent: Michael Phelps is now the 200 butterfly world champion at age 16, Aaron Peirsol took gold in the 200 backstroke and Brendan Hansen, 19, was the surprise winner of the men's 200 breaststroke.
Phelps, who beat Tom Malchow's world record at the U.S. trials in March, upstaged the Olympic champion again in the final here, improving the world mark again to finish in 1:54.58.
Its decision not to do blood tests for the performance-enhancing hormone EPO notwithstanding, FINA reported a drug-free championship as of the end of the program, although the last tests will be analyzed this week.
TITLE: Colombia Completes Sweep For Victory at Copa America
AUTHOR: By Peter Muello
PUBLISHER: The Associated Press
TEXT: BOGOTA, Colombia - Colombia was perfect in Copa America, beating Mexico 1-0 on Sunday to complete a six-game sweep and win Latin America's oldest soccer tournament for the first time.
Defender Ivan Ramiro Cordoba leaped over the Mexican defense to head in a corner kick in the 65th minute to give Colombia the title it sought since the tournament was first held in 1916.
Colombia reached the final only once before, losing to Peru in 1975. This time it reached perfection, finishing with six wins and not allowing a single goal.
When the final whistle blew, the 46,000 fans in El Campin stadium erupted in cheers and cries of "Colombia! Colombia!" The joy was mixed with gratitude for the team's brilliant campaign that helped distract Colombians from the chronic violence that nearly forced the tournament to be canceled.
"No country had to fight like we did," Colombian President Andres Pastrana said as he congratulated the players. "It's an important step to help achieve peace."
Colombia won despite losing its star Victor Aristizabal in the 30th minute. Aristizabal, who scored goals in all of Colombia's previous games, left after colliding with goalkeeper Oscar Perez.
In the third-place game, Honduras beat Uruguay 5-4 on penalty kicks after tying 2-2.