SOURCE: The St. Petersburg Times
DATE: Issue #775 (41), Friday, June 7, 2002
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TITLE: U.S. Follows Market Pledge
AUTHOR: By Torrey Clark and Lyuba Pronina
PUBLISHER: Staff Writer
TEXT: MOSCOW - The United States announced on Thursday that it recognizes Russia as a market economy, a distinction that Moscow said should provide a tremendous boost to Russian exports and the economy.
 
U.S. President George W. Bush broke the news to President Vladimir Putin in a telephone call on Thursday. 
 "Putin welcomed this step toward Russia, which is a real market-economy country, noting that this will give impetus to developing bilateral economic ties," the Kremlin press service said.
 Prime Minister Mikhail Kasyanov was "deeply satisfied," Interfax reported.
 Economic Development and Trade Minister German Gref said that current U.S. trade restrictions on commodities such as steel, titanium and fertilizer cost Russian companies $1.5 billion per year.
 "This is a certain sign, a certain symbol to recognize those reforms that are taking place in Russia," Gref said on RTR television. "It will present new opportunities for Russian enterprises and investment in Russia."
 Russia's largest steel producer, Severstal, cautioned, however, that Russia and the United States must quickly sign a special memorandum limiting the period the U.S. government could use in assessing countervailing duties to the post-privatization period.
 "Without the signing of this memorandum, we can expect a whole series of new countervailing-duty investigations against Russian companies," said Severstal's Dales Director Dmitry Goroshkov.
 U.S. Commerce Secretary Donald Evans said in a statement that the decision to grant Russia market status "reflects the tremendous economic changes that Russia has made over the last decade."
 The decision is retroactive to April 1, the start of the second quarter.
 That means "in future cases involving Russian products, the department will now begin using actual process and costs from within Russia and from within actual transactions in Russia for the purpose of calculating anti-dumping and countervailing duty levels," a Commerce Department official said.
 "Any ongoing proceedings ... that precede our effective date will continue as is," he said.
 As such, restrictions on steel and ammonium nitrate will remain in place. But a Russian company will now be able to protest a restriction and request a review.
 It was not immediately clear whether any company would ask for such as review, which the United States as the right to refuse. Steel producers, for example, have been going back and forth in recent weeks on whether they want greater access to the U.S. market, first asking the Russian government to withdraw from a quota deal with Washington and then changing their minds when they saw that U.S. steel prices were increasing.
 Severstal head Alexei Mordashov said only: "This is a very important and long-expected decision for Russian metals. We hope that the market economy status for Russia will help us with anti-dumping suits against Russian steel."
 The Commerce Department official said the decision was made after a nine-month investigation by the department's Import Administration.
 Under the law, the Commerce Department must review criteria such as currency convertibility, free bargaining for wages, openness to investment, government ownership or control of means of production and government resource allocation.
 The Commerce official conceded that a sticking point - and one that will remain so in WTO negotiations - had been over the state's allocation of resources in natural monopolies Gazprom, the Railways Ministry and Unified Energy Systems.
 "The energy issue was one area where we have found the most significant problems where government controls have been affecting price setting in a way that ... we found to be distortive," he said.
 He added: "Commentators raised issues of concern including corruption and barter, which we looked at and found ... that although in both respects they were problem areas, they did not fundamentally affect the market orientation of the economy."
 He said privatization has denationalized the economy even more than in Kazakhstan and Latvia, which already have U.S. market-economy status. The Russian private sector now accounts for 70 percent of gross domestic product, compared to 60 percent in Kazakhstan, 65 percent in Latvia and 80 percent in Hungary.
 Countries whose economies remain unrecognized by the United States include China, Vietnam, Romania and 10 republics in the CIS.
 Vladimir Mau, an influential economist, said the new status would give Russia a much-needed window of opportunity to develop trade.
 "It is very important to understand that the market economy status is needed primarily for overcoming the current situation in which Russian exports are dominated by oil and natural resources," he was quoted by Interfax as saying.
 Scott Antel, a partner at Ernst & Young who participated in the market status hearing in Washington in March, cautioned the status does not mean a smooth ride from hereon in.
 "Overall this is positive, but it means Russian companies are going to have a huge number of anti-dumping and countervailing duty cases raining down on them in the near future," he said.
 "The war has just begun," he added. "If Russian companies want to compete in the international arena, they're going to have to fight their cause. The benefits are certainly worth it."

TITLE: Collapse Death Toll Rises to Three
AUTHOR: By Irina Titova
PUBLISHER: Staff Writer
TEXT: As of Thursday evening, city officials were reporting that three people had died and one person was listed as still missing as a result of the partial collapse of a nine-story building on Dvinskaya Ulitsa on Monday.
 
The bodies of Maxim Eskin, 15, and Olga Novikova, 31, an employee of Petrovsky Bank, which had an office on the first floor of the building, were discovered by rescue workers under the rubble on Tuesday and Wednesday, respectively. The body of a 55-year-old man had been found by rescue workers on Monday.
 The process of clearing the wreckage from the disaster was completed on Wednesday night, but rescue workers were unable to find any sign of the remaining missing person, 16-year-old Marina Pochatova.
 On Thursday evening, three different bodies - the city and federal construction commissions and the Russian Emergency Situations Ministry - announced the conclusions of their investigations into the causes of the disaster. Each of the groups carried out their investigations independently.
 "The collapse was caused by a combination of factors," said Alexander Vakhmistrov, head of the city's Construction Committee. "The chief factor was demonstrated by the negative indices we discovered while examining the soil under the section of the building that collapsed. The ground there was much less solid than under the rest of the building, largely because of underground water."
 According to Vakhmistrov, the collapsed section of the building was built directly over the former site of a canal, so the foundation in that part of the building was different from that in the sections still standing.
 "This contributed directly to the second factor," he added. "The engineers who were in charge of laying the foundation didn't take into account the peculiarities of the site."
 Vakhmistrov also said that some kind of disturbance in the building's foundation could have also played a part in the collapse. He said that this factor was still under investigation.
 Although Vakhmistrov said that it was still unclear what the form of the disturbances might have been, he said that they were now inspecting previous reconstruction work in Petrovsky Bank's office.
 Emergency Situations Minister Sergei Shoigu, who arrived in St. Petersburg on Monday night, ruled out a terrorist act or an explosion as having been the cause of the accident.
 The St. Petersburg Prosecutor General's Office has opened a criminal investigation into the cause of the accident under Article 216 of the Criminal Code, which covers the violation of construction norms that lead to death.
 The federal and city governments, meanwhile, moved to deal with the situation faced by the 60 families - about 190 people - who lost their homes in the disaster. On Thursday they were given inspection authorization for new apartments, and the governments announced that they will soon be given certificates to use to purchase new housing.
 The cost of the new housing will be shared evenly between the federal and city budgets.
 Governor Vladimir Yakovlev, who cut short his visit to Strasbourg, France, and arrived back in the city on Tuesday morning, said that every family will receive compensation in the amount of 50,000 rubles ($1,600). He said that where victims have larger families, the sums will be determined on a case-by-case basis.
 The governor also announced on Tuesday that he had ordered the inspection of all buildings of the same design in the city. He said that there were more than 30 such buildings in St. Petersburg.
 While a quarter of the building collapsed and the section adjoining it was swept by fire, the situation in the remaining half of the building has raised the ire of the tenants there.
 The commissions involved in determining the cause of the disaster were also charged with determining the condition of the remaining half of the building. Anna Markova, city vice governor and head of the city's emergency commission, said on Thursday that the inspections had determined the building to be in safe condition.
 But the approximately 200 people who live the other half of the building refuse to return live in their apartments. By Thursday, most of them had removed their belongings and gone to live with friends.
 "We understand the psychological fear for these people in returning to their homes," Markova said. "But if major bodies like the State Construction Commission and the Emergency Situations Ministry give their guarantees of the safety of the building, they mean what they are saying." 
 This wasn't convincing residents in the building, however.
 "You would have to be an idiot to keep living in this building," said one resident, Svetlana Yakovleva, on Wednesday. "There's no way that I will take my children in there. I'd rather live in the street than in a building that could collapse."
 Strangely, though Markova maintains that the remaining half of the building is safe, Vakhmistrov of the City Construction Committee said that work had to be done there
 "The inspectors said that the city should carry repairs on that part of the building this summer, this hasn't been done in about 30 years," he said.

TITLE: Russia-NATO Meeting Follows on Heels of Deal
AUTHOR: By Paul Ames
PUBLISHER: The Associated Press
TEXT: BRUSSELS, Belgium - Russian and NATO defense ministers pledged to step up military cooperation on Thursday, in the first ministerial meeting of a new council launched to bring the former adversaries together in the fight against terrorism.
 
"It is a mark of the political will underpinning the new NATO-Russia relationship that we have been able to get down to real business so quickly and so effectively," said NATO Secretary General George Robertson.
 Barely 10 days after Russian President Vladimir Putin and his NATO counterparts signed an agreement setting up the new cooperation council at a summit outside Rome, the two sides agreed on a package of joint defense measures.
 They included better counterterrorism protection for peacekeepers in the Balkans; a joint assessment of terrorist threats to airliners, nuclear power plants and other civilian and military targets; and cooperation to prevent the spread of nuclear, chemical and biological weapons.
 "We are confronted with very serious threats to our security," Russian Minister Sergei Ivanov told reporters after the meeting. "Those threats need to be combatted with very different tools than those used during the Cold War."
 The two sides agreed to hold more joint exercises and consider using Russian planes to plug gaps in NATO military arsenal by providing transport to ferry allied troops to far-flung destinations and air-to-air refueling.
 Such plans dovetail with the thrust of the NATO defense minister's meeting earlier Thursday, which sought to overcome shortfalls in the alliance's ability to deploy troops long distance to quell potential terrorist threats.
 "Some of the capability gaps that the NATO countries have are gaps that could be filled by Russia," Robertson told a news conference.
 Other areas where they agreed to look at increased cooperation included providing missile cover to troops in battle, and submarine rescue operations - an area of particular sensitivity to Russia following the sinking in 2000 of its nuclear submarine Kursk with the loss of all 118 crew.
 Ivanov repeated Russia's opposition to NATO's plans to invite in up to seven new members from eastern European at a summit in November, but indicated the expansion would not cool relations with the alliance.
 "The question about NATO enlargement is not our business, it is NATO's business," he said.

TITLE: Smolny Vice Governor Resigns
AUTHOR: By Vladimir Kovalyev
PUBLISHER: Staff Writer
TEXT: Yet another vice-governor exited the administration of Governor Vladimir Yakovlev last week but in a change from earlier departures, this time he left of his own accord.
 
Vice governor Yury Antonov resigned on Friday, citing personal reasons.
 "Antonov just wanted to go, so he did," Alexander Afanasyev, the City Hall spokesperson, said in a telephone interview Wednesday. "He has wanted to leave for quite a while. He talked about it for the first time in 2000 and then again last year. The vice governor's job is not all that enjoyable, you know."
 While City Hall officials are remaining relatively quiet about Antonov's reasons for going, a number of analysts believe that they can be traced to his plans to seek a larger role in the local political arena. Antonov played a key role in Yakovlev's successful re-election campaign in 2000, coordinating activity at election headquarters, and analysts say that his success and popularity then are part of the reason he is leaving now.
 "His popularity had been growing significantly following his overwhelming success working for Yakovlev in the elections, and this was putting a strain on relations within City Hall," Alexei Musakov, the head of the St. Petersburg Center for Regional Development, said in a telephone interview on Wednesday.
 Musakov said that there is a chance that Antonov may seek a seat in the Legislative Assembly during the elections for that body in December, running as a United Russia-faction candidate, and use that as a springboard toward a candidacy for the post of Governor when Yakovlev leaves office.
 "Some forces in higher political circles are happy about the fact that there is a promising politician in St. Petersburg who could participate on their side in the next gubernatorial elections," he said.
 Representatives of the United Russia faction could not be reached for comment on Thursday.
 Ruslan Linkov, the local head of the Democratic Russia party, said that Antonov and Yakovlev were involved in a long-term game of political maneuver that began long ago to secure the governor's spot should Yakovlev abandon or be removed from his post.
 "I think that this is going to happen in August. Yakovlev would be removed in an absolutely legitimate way," Linkov said in a telephone interview on Wednesday. "That's what they're trying to do now, to distance Antonov from Yakovlev so that he can run in gubernatorial elections in December and make the claim that he is not part of Yakovlev's team."
 "It's a case of the rats abandoning a sinking ship," Linkov added.
 "Antonov could be a potential candidate for gubernatorial elections from the Unity faction ... [but] the governor won't step down on his own, because he wants his name to be written in St. Petersburg history in bold letters," Viktor Yevtukhov, a Unity Party deputy in the Legislative Assembly, said on Wednesday. "We should be prepared for anything in this country, so if it happens that [gubernatorial] elections will be held in December, we will look through the list of potential candidates."
 But Yabloko party deputy Boris Vishnevsky disagrees with the opinion that Antonov would be an attractive choice for voters should elections for governor take place in December.
 "Look at him. He looks more like somebody's bodyguard than a person who would be popular with the public," Vishnevsky said in a telephone interview on Wednesday. "If I didn't know that he is a very kind and intelligent person, I wouldn't want to be alone in an elevator with him."
 "He would cause headaches for those who are looking to use him to advance their own political interests because of his membership on the board of directors of PTK," Vishnevsky added. "You know who heads up this company."
 City-owned fuel company PTK is co-headed by PTK Vice President Vladimir Kumarin, who is reported to be the leader of the powerful Tambov criminal syndicate.
 Kumarin denies the claims, saying in 1999 that the Tambov group didn't exist in an interview with Kommersant daily. "We don't conduct any meetings and we don't have any membership payments," Kommersant quoted him as saying
 "How can Antonov effectively work against the governor when he knows that Yakovlev probably has bags of compromising information about him?" Vishnevsky asked.
 Antonov is the fifth vice governor city hall has lost in the last year, following Gennady Tkachev, who was replaced last month due to health reasons; Alexander Potekhin, the acting chief of the Media Committee, who resigned in December after an investigation was launched against him for engaging in illegal business activities; Health Committee head Anatoly Kogan, who was charged with criminal negligence in April and removed from office that same month in accordance with a request by the Northwest Region Prosecutor's office. Valery Malyshev, the head of the Sports and Communications committee, was charged with abuse of office in July of last year and resigned from office in October. Malyshev died last month of a stroke.
 On Wednesday the Legislative Assembly confirmed two new members of the governor's team, Konstantin Kondakov, who will head the Sports and Communications Committee, and Alexander Prokhorenko to head the External Affairs Committee. Yakovlev said on Wednesday that he would name a candidate to replace Antonov on Friday.

TITLE: Anti-Extremism Bill Riles Rights Activists
AUTHOR: By Nabi Abdullaev
PUBLISHER: Staff Writer
TEXT: MOSCOW - A presidential bill on combating extremism was pushed through the State Duma by pro-Kremlin factions Thursday, despite criticism from the Communists, liberal lawmakers and human-rights advocates, who say the measure will give the government too much power to suppress public protest.
 
Justice Minister Yury Chaika, who lobbied for the law in parliament, told the deputies the legislation was sorely needed and asked them to pass it in all three readings before going on vacation at the end of the month. The bill passed its first reading Thursday with a 271-141 vote and was accompanied by amendments to the Criminal Code.
 The pro-Kremlin Unity and People's Deputy factions, centrist Fatherland-All Russia and Vladimir Zhirinovsky's Liberal Democratic Party voted unanimously for the bill. All members of the Communist and agro-industrial factions voted against it, and other factions were split.
 Government officials have persistently reiterated the need for anti-extremism legislation, especially since a wave of racist attacks - many of them attributed to skinheads - earlier this year. Other recent hate crimes include last month's explosion of a booby-trapped anti-Semitic sign, which injured a woman who tried to pull it out of the ground.
 The bill defines extremism as "illegal activities" aimed at the violent takeover of power, terrorism, incitement of ethnic and religious hatred, public demonstration of Nazi symbols, hindering the legal activities of government authorities and at other goals, many of which are already classified as illegal under existing legislation.
 Under the bill, only a court can disband an organization classified as extremist, but the official body responsible for registering the organization can suspend its activities pending a court decision.
 The bill also forbids extremist slogans on the Internet, but rights campaigners have criticized the provision as ambiguous and divorced from existing legal concepts. 
 Arguing in support of the bill on Thursday, Justice Minister Chaika said the government often fails to cope with extremism because of legal loopholes and that new legal tools are needed to deal with neo-fascist organizations.
 However, Yabloko deputy Sergei Popov replied that existing legislation is sufficient to combat extremism - the problem is a lack of enforcement, Interfax quoted him as saying.
 Communist Viktor Zorkaltsev, head of the Duma committee on public organizations, said the bill is "anti-democratic" and lays the groundwork for politically charged criminal investigations, Interfax reported. Zorkaltsev echoed criticism by human-rights groups, saying the bill's definition of extremism is too vague and enables the authorities to treat any organized public group, from striking teachers to protesting environmentalists, as extremists.
 The Communists have been fighting attempts to introduce anti-extremism measures since the days of former President Boris Yeltsin, fearing they would be among the first groups to be targeted and, possibly, disbanded under the law.
 The president's envoy to the Duma, Alexander Kotenkov, tried comforting the Communists, saying the bill is not aimed at opposition groups that act within the bounds of the law.
 Both Chaika and Kotenkov promised they would take into consideration all amendments submitted for the second reading.
 Some of the key changes called for by the Union of Right Forces faction included bestowing the right to suspend an organization's activities exclusively on the courts and omitting the provision that classifies "hinderances" to the activities of government bodies as extremism. The faction ultimately supported the bill 29-2.
 Human-rights activists were displeased by Thursday's vote. Lev Ponomaryov, head of For Human Rights, told Interfax that, after the bill enter into law, police would target innocent people in order to improve their statistics.
 "I will not be surprised if teenagers get arrested on the streets just for having their heads shaven," he said.

TITLE: Putin Calls for Closer Links to China
AUTHOR: By Vladimir Isachenkov
PUBLISHER: The Associated Press
TEXT: After moving to build closer ties with the United States and NATO, President Vladimir Putin is turning to China, which has been jealously watching Russia's honeymoon with the West.
 
Putin met with Chinese President Jiang Zemin in St. Petersburg on Thursday, on the eve of a Shanghai Cooperation Organization summit in the former Russian imperial capital. The group, dominated by Russia and China, also includes four former Soviet republics in Central Asia - Kazakhstan, Kyrgyzstan, Tajikistan and Uzbekistan.
 Summit participants are expected to sign the group's charter, making it a full-fledged international organization. Speaking to a Chinese newspaper before the summit, Putin hailed the group's role in global security, saying it could help make Russia, China, the United States and Europe parts of one "arc of stability."
 While Russia's ties with the West turned from initial post-Soviet euphoria to new tensions during the 1990s, Russia has developed increasingly close ties with its former Communist rival, China. The Russian-Chinese "strategic partnership" was cemented by their joint opposition to what both countries perceived as the threat of U.S. global domination.
 "Russia's foreign policy throughout the 1990s was chaotically swaying between the United States and China," said Sergei Trush of the Moscow-based Institute for the United States and Canada at a discussion on Russian-Chinese relations on Wednesday. "Russia was trying to determine which of the two great powers was more important."
 China has become the No. 1 customer for the beleaguered Russian defense industry, which nearly ground to a halt without orders from the cash-strapped defense ministry, purchasing billions of dollars worth of missiles, fighter jets, destroyers and submarines in recent years.
 Welcoming Jiang, Putin said that the two countrieshave "big plans" for expanding military cooperation.
 Russia's cooperation with China culminated in a friendship treaty that Putin and Jiang signed last July, the first such document since 1950, when Joseph Stalin and Mao Tse-tung created a Soviet-Chinese alliance - a friendship that slid into rivalry and then hostility in the 1960s.
 Addressing Jiang as "comrade," Putin hailed him for initiating the friendship treaty, "an historic document which laid the foundation for the development of Russian-Chinese ties."
 The Shanghai security group, formed to help reduce tension on the former Soviet border with China, later became a forum for discussing joint action against the Islamic separatism that threatened Russia and Central Asian republics, as well as China.
 Although China has not criticized the agreement making Russia a limited NATO partner, it has repeatedly dismissed the alliance as a Cold War relic that has no reason to exist. Beijing has also been uneasy over the U.S. military deployment in Central Asia next to its borders.
 Putin sought to assuage China's concerns. "We believe that relations with our great eastern neighbor, China, are a major priority," he said this week. "We have always conducted a balanced foreign policy. We intend to develop relations with both East and West."
 While China's top concern was Russia's efforts to befriend the West, many Russian politicians and the media were worried about the flow of Chinese migrants into Russia's sparsely populated Far Eastern and Siberian regions, which China has claimed for centuries.
 Despite all the talk about partnership, trade between Russia and China only amounts to some $10 billion a year - an amount dwarfed by China's $120-billion annual trade with the United States.

TITLE: Local Media Tycoon Dies of Heart Attack
AUTHOR: By Claire Bigg
PUBLISHER: Staff Writer
TEXT: St. Petersburg media mogul Dmitry Rozhdestvensky, the founder of one of St. Petersburg's first private television stations, Russkoye video died of a heart attack Thursday morning at his dacha in Siverskaya.
 
Rozhdestvensky's activities at Russkoye Video led to charges being filed against him in 1998 for tax evasion after a Federal Audit Chamber investigation asserted that he had made 10.5 billion rubles ($115 million) during the ruble's 1998 plummet. Rozhdestvensky spent two years in pretrial detention
 The Prosecutor General's office also pressed charges against Rozhdestvensky for allegedly embezzling 142,500 Finnish marks ($27,000), a state-owned Lada car and $56,000 in cash. Investigators said the former head of Russkoye Video had used the embezzled funds to build a luxurious dacha for himself.
 He was, however, relased on bail in August, 2000 due to health reasons, and the charges concerning the tax offences were dropped for lack of evidence.
 Rozhdestvensky had suffered health problems during his detention, suffering his first heart attack.
 The embezzlement charges were not dropped, and, in January, 2002, Rozhdestvensky was convicted to three years imprisonment and all of his assets were seized.
 He never actually served any of the sentence, however, due to an amnesty decree issued in 2000 by then-President Boris Yeltsin, on the occasion of the 55th anniversary of the Russian victory in the Great Patriotic War.
 Rozhdestvensky was born in Leningrad in 1954 and graduated from the Musorgsky College of Music, the Gnesiny State Institute for Music and Pedagogy, and the Film Faculty of the Leningrad State Conservatory. He produced over 300 movies and other film projects including "The Afgan Fracture", "A Different Drama", "The Executioner", and "Promenade-Concerts at the Mariinsky."
 Rozhdestensky will be buried on June 10 in St. Petersburg's Serafimovskoye Cemetery. The funeral service will be held in the Preobrazhensky Cathedral.

TITLE: U.S. Aims To Promote Relations With Alfa
AUTHOR: By Torrey Clark
PUBLISHER: Staff Writer
TEXT: MOSCOW - Through its Overseas Private Investment Corporation, the U.S. government on Tuesday evening signed a memorandum of understanding with the country's largest private bank, Alfa Bank, to promote investment projects in Russia.
 
In an encouraging step, backing up the warm talks U.S. President George W. Bush and President Vladimir Putin had at their May summit, OPIC intends to support a $100-million investment fund.
 "Over the past year there have been enough indications that people are looking. I think this is an indication that foreign direct investment is on the way," said Roland Nash, head of research at Renaissance Capital.
 Foreign investment has been a dark spot on Russia's economic growth, with per-capita figures remaining stubbornly lower than those for Eastern Europe and other emerging markets. According to the Central Bank, total foreign investment fell $1.7 billion in 2001. Some strategic investments, however, may have taken place offshore, Nash said.
 The memorandum, signed by Alfa Bank president Pyotr Aven and OPIC president Peter Watson in Washington, comes soon after Bush unveiled the new Russia-Eurasia Investment Fund at the U.S.-Russia summit in Moscow. OPIC will lend $33 million to the fund.
 The fund targets regions or sectors whose financing needs are not met by the private sector. Based on a recent study of supply and demand for private equity in Russia, OPIC has estimated a gap in Russia of $2.2 billion in 2003, which could more than double by 2007.
 OPIC supports eight private investment funds with $820 million invested in Russia and the other republics in the Commonwealth of Independent States. In Russia, OPIC supports 15 finance and political risk-insurance projects worth almost $338 million, primarily in manufacturing and energy, as well as mining, financial services and communications.
 With good feeling inspired by the summit and following three years of strong economic growth, Russia is bright on the West's radar. And although the fund and the memorandum are not directly linked, they have a common root.
 "After the meeting of the presidents, this is a very concrete step that will hopefully accelerate the [investment] process," said Alfa Bank board member Alexander Tolchinsky, who was present at the signing. "There is no shortage of money, there is a shortage of good projects. We will try to do things so OPIC money can come in as well as Alfa's money."
 The memorandum is part of Watson's efforts to make Russia a priority area, OPIC official Lawrence Spinelli wrote in an e-mail on Wednesday. "[It] establishes a framework for cooperation, including business development, between OPIC and Alfa to support U.S. private-sector investment in Russia," he added.
 Under the memorandum, Alfa Bank and OPIC will cooperate in developing private investment and promoting foreign investment, look for projects they can support or co-finance and look at ways to pool private-investment-promotion resources. They will also share information, including the possibility of setting up a project database.
 Neither Alfa Bank nor OPIC would commit on specific projects in the works.
 "We are already thinking of how to move forward on this," Tolchinsky said. "We already have reasons to work together and we are starting to do that. By fall we should have something specific."


TITLE: Could Be Better, but Russian Banking is Back on Track
AUTHOR: By Andrey Musatov
PUBLISHER: Staff Writer
TEXT: The Russian banking sector is continuing to grow, already having reached the pre-1998-financial crisis levels, according to statements made by participants in the 11th International Banking Congress, which opened in St. Petersburg yesterday. On a less positive note, the participants also said that levels of transparency and the trust placed by Russians in Russian banks remain very low.
 
Among measures aimed at increasing those levels of stability and trust, the Central bank stated that within two years it will be prepared to implement a system guaranteeing deposits. It is intended that the law for the regulation of that system will be put before the State Duma by the end of June.
 Speaking at a press conference held a day before the congress, Andrei Kozlov, first deputy chairperson of the Central Bank, said that the law will establish a number of criteria for credit organizations, covering the quality of business planning, resource base, capital volume, levels of financial stability in risk management and the qualification levels of managers.
 According to analysts, the implementation of such a system will only be possible when the banking system in Russia has switched over to international financial-reporting standards. Without having achieved this, it is unclear how factors such as financial stability will be determined. 
 According to Vartan Dilanyan, director of the financial-markets department at Ernst & Young, who also spoke at the congress, there is a significant lack of transparency at Russian banks, particularly where banking activities, ownership and the decision-making process are involved. This lack of transparency, according to Dilanyan, comes as a result of defects in Russian accounting standards. 
 "The accounting standard has a very strong influence on clients and investors in the bank," he said. "The new code for corporate governance at commercial banks will also be a very attractive factor for long term investment in banks."
 According to Jeremy Foster, a partner at PricewaterhouseCoopers, a switch to international accounting standards is likely to be accompanied by a change in the mentality of bank managers.
 "That change should be supported by extra professional education," he said. "At present, about 10 percent of Russian banks use international accounting standards. Those banks that really want to be open in their work, attract the specialists needed to achieve that."
 Sergei Ignatyev, chairperson of the Central Bank, also noted that the banking system in Russia presents an obstacle to economic development. 
 "Switching Russian banks over to the international standard, and the supervision capabilities that this move entails, will improve the whole banking sector," Ignatyev said. "It will also raise the levels of trust placed in banks." 
 Reporting on the banking sector's recovery following the 1998 crisis, Kozlov said that more than 90 percent of Russian banks had shown profits in 2001. According to the criteria currently employed by the Central Bank, these banks are deemed to be financially stable.
 In 2001, bank assets grew about three times faster than the gross domestic product (GDP). The majority of bank funds were used to finance export sectors, while companies working in domestic markets took up about 35 percent of funds. About 43 percent of the total amount of loans distributed were placed in the fuel and metals sectors.
 By the beginning of April, 2002, the combined assets of the Russian banking system had increased to 6 percent above pre-crisis levels, joint capital was raised by 14 percent and credit portfolio growth totaled 47 percent, without adjustment for inflation and devaluation.
 According to the Central Bank, by April 1, total bank assets reached 35.3 percent of the estimated GDP for 2002, while total capital reached 5 percent of estimated GDP. The total credit portfolio came to 13.5 percent of the estimated GDP for the same period, with the estimated GDP for 2002 being 10,950 billion rubles (about $350 billion).

TITLE: Market in Soccer-Induced Slowdown
AUTHOR: By Natalia Yefimova
PUBLISHER: Staff Writer
TEXT: MOSCOW - Trading on the stock exchange slowed to a trickle. The State Duma twice interrupted its morning session. Crowds of hollering young men flooded downtown Moscow, obstructing traffic. And yet Prime Minister Mikhail Kasyanov declared that he and the entire Cabinet are in "the best of moods."
 
The reason behind it all? Russia's lacklustre match with Tunisia in its debut at the World Cup tournament in Kobe, Japan, which ended in a 2-0 shutout by the unpredictable Russian team.
 "I hope the success of the Russian national side only reinforces our teams' desire for victory," Kasyanov told reporters.
 Lawmakers pushing ahead with one of the last plenary meetings of the spring session had trouble concentrating on their work, as Duma Speaker Gennady Seleznyov twice interrupted them to announce Russia's goals, both scored within a tense five minutes in the second half of the morning game.
 The Duma deputies ultimately put work before pleasure, voting down a proposal by independent Sergei Yushenkov to start the session two hours later than scheduled in order to watch the match. 
 Even the markets could not remain stolid. At noon - 30 minutes before game's end - trade on the RTS hovered at a sorry $651,000, about a quarter of its average. But Russia's victory apparently inspired the traders, with jumps in buying after each goal, said RTS spokesperson Alexander Dyakovsky. By 1 p.m., volumes had bounced back to an acceptable $3.71 million, only about $100,000 less, hour on hour, than the previous day.
 
 <i>
Staff Writer Larisa Naumenko contributed to this report. </i>

TITLE: A Less Secular Approach
AUTHOR: By Sergei Filatov and Lawrence Uzzell
TEXT: LET us celebrate one of post-Soviet Russia's far too pleasant surprises: the failure of fringe religions. To this day, some in the Russian Orthodox Church are still whipping up hysteria over so-called totalitarian sects, then directing that hysteria against mainstream Protestants and Roman Catholics. Both the Orthodox and the non-Orthodox still often warn that Russia's &quot;slave mentality&quot; and current &quot;spiritual vacuum&quot; provide opportunities for religious demagogues to turn millions of gullible Russians into spiritual zombies. The real story of the past decade is less exciting but more encouraging.
 
Where are those millions? In Keston Institute's forthcoming encyclopedia on religion in Russia, we try to study this and other controversial questions empirically. A recently published anthology of essays provides an advance taste of our findings on topics such as diocesan politics, inter-faith and church-state relations, and the rise and fall of new religious movements.
 The rise and fall are interesting in sharply different ways. The perestroika years created a more hospitable climate in Russia than anywhere in the West for movements such as the Moonies and the Scientologists - temporarily. The manifest failure of state atheism and sudden new respectability of religion in general, combined with ignorance about particular religions, made for scenes worthy of comic opera.
 We remember the conspicuous exhibit at Moscow State University's journalism library honoring a man whom one instructor called &quot;the great American philosopher&quot; L. Ron Hubbard. In 1990, Mikhail Gorbachev himself gave a personal audience to the Reverend Sun Myung Moon. Soon the Education Ministry was giving the Moonies privileged access to thousands of state schools with their captive audiences of impressionable pupils.
 In the early 1990s, Western faiths had the same kind of advantages over traditional Russian religions that McDonald's had over Russian eateries: not just capital but Western organizational techniques, including experience competing in the free market. But the religious entrepreneurs proved far less successful.
 Even at their peak in 1994, the Moonies had only about 5,000 full-fledged members in Russia. In 2000, the dwindling flock of Russian Moonies suffered a severe blow when one of their most visible leaders, historian Lev Semyonov, converted to the Orthodox Church.
 Russians soon learned how to use the new conditions to sell homegrown cults such as the White Brotherhood, with its crude appeal to Slavic nationalism. This movement claimed that its leader, Marina Tsvigun, was the reincarnation of both Jesus Christ and the Virgin Mary and predicted that the world would end in 1993. Only 144,000 people would be saved - all of them Slavs.
 The White Brotherhood displayed the classic attributes of a cult, such as the isolation of its members from outside influences, demands that they renounce normal social life and secular careers, and insistence on unquestioning obedience. But however useful the concept of cults may be to sociologists, there is no reliable way to codify it as a precise legal term. Renunciation of property, asceticism, obedience - all these have been requirements of monastic life, including that of the Orthodox Church, for centuries. Any legislation empowering the state to crush &quot;destructive sects&quot; would also enable it to persecute any religion.
 In October 1993, however, the White Brotherhood did something justifying the arrest of its leaders: it stormed the Orthodox Cathedral of St. Sophia in Kiev. Unfortunately for Tsvigun, the world did not come to an end that autumn as she had predicted, nor did the Kiev police. She ended up spending several years in prison. In Russia, unlike Ukraine, her followers committed no such assaults and suffered no serious state repression - but they never numbered more than 4,000. Now there are perhaps 1,000 of them. As with the imported cults, what is striking here is the discrepancy between their tiny size and society's stormy reaction.
 In fact, it is repression rather than freedom that causes sects to become entrenched in their most sectarian characteristics. In free societies, these movements usually abandon their defiance of social norms within just one generation. In authoritarian Russia, by contrast, the 18th-century Skoptsi continued to practice self-castration until at least the middle of the 20th century.
 Russian religious life is now characterized by eclecticism and experimentation. Rather than becoming highly disciplined followers of sects strictly controlled by their leaders, today Russians dabble in readings and discussion groups from a wide variety of movements - often mutually contradictory. The current situation of religious entropy is now becoming a stable system rather than a transitional stage to a new religion. The Russian Orthodox Church itself is now infected with this nontraditional religiosity.
 For serious Orthodox Christians, this is unfortunate, but the remedy is in their own hands. The Moscow Patriarchate should be more consistent about teaching its members their heritage. For example, its priests in northern Siberia should stop encouraging simple-minded believers to arrange both Christian baptism and pagan initiation ceremonies for their children. Parishes in university towns should insist that Orthodox Christianity is logically incompatible with certain other belief systems, and that Sunday-school teachers and Bible-study leaders should stop blending Orthodoxy with the promotion of flying saucers, extra-sensory perception and New Age teachings.
 The entrenched reflex of today's Moscow Patriarchate is to rely on the secular state to protect its status as a traditional religion - but the state's agenda will not always coincide with the teachings of Orthodox Christianity, and the state will always put its own interests first. If it is truly serious about opposing new religious movements, the Orthodox Church should rely more on its own preaching and internal discipline and less on the courts and police.
 
 <i>Lawrence Uzzell is head of Keston Institute (www.keston.org), an independent research center based in Oxford, England. Sergei Filatov of the Russian Academy of Sciences is editor of Keston's forthcoming encyclopedia on religious life in post-Soviet Russia. They contributed this comment to The St. PetersburgTimes. </i>

TITLE: Time To Call A Hate Crime A Hate Crime
TEXT: SKINHEADS threaten a dozen embassies with a &quot;war against foreigners.&quot; An Afghan man dies after a racist attack in the metro. Shaven-headed teens beat a Jewish boy and break his nose. A booby-trapped road sign with an anti-Semitic slogan explodes and seriously injures a passer-by when she tries to remove it.
 
There is no question that something needs to be done to stop these worrisome hate attacks, which were just a few among dozens of similar incidents reported across the country.
 But the new law on extremism that the Kremlin is suggesting is not the answer. The bill drafted by the presidential administration is so vague that it could be used to outlaw Greenpeace, peaceful protesters at unsanctioned rallies and even the Communists, should they re-emerge as a force to be reckoned with.
 It is small comfort that the bill permits only the courts to determine which group is extremist, because the authorities can still suspend the accused's activities pending the ruling. And the wait could take months.
 Moreover, only groups officially registered with the proper authorities can have their activities suspended. The loosely organized skinheads terrorizing the country have no registration permits.
 Extremism is fed by factors that are all too prevalent in present-day Russia - corruption, economic despair, moral decay and spiritual disorientation. Stopping extremism requires just the opposite - a reliable justice system, economic opportunity and ethnic and religious tolerance.
 The necessary long-term measures are the same ones that are needed across the board - rooting out corruption at all levels of the government and building a stable economy with fair, timely wages and the opportunity for career growth. Government and religious leaders should be tolerant of various faiths, never favoring or deriding one or another. Also, schools should help foster tolerance, picking up the slack where parents and society fail.
 Those who commit hate crimes must be punished for hate crimes and not for &quot;hooliganism,&quot; as the police and courts now usually define their offenses. But a law on extremism is not required to fight the battle; existing laws are sufficient. What is missing is the political will to enforce them.
 Granted, there is no easy way out of the problem, in part because it has been left unchecked for so long. But rather than fighting fire with fire - or drawing up a law to show that the recent jump in hate crimes is being dealt with - the Kremlin needs to heed the old proverb that an ounce of prevention is worth a pound of cure.

TITLE: Chechnya Isn't A War Made For the Courts
TEXT: RUSSIA'S ruling oligarchic class has a penchant for amusing, base and even comic trials in which its members air their grudges against one another and satisfy their basic needs. One oligarch, say, takes over a company and has his rival put on the most wanted list. 
 
BUT one political trial now under way is remarkable for its sheer pointlessness in terms of state interests - the trial of Colonel Yury Budanov, charged with the murder of Elza Kungayeva, a young Chechen woman.
 Not long ago another juicy tidbit was revealed about this heroic warrior who did so much to protect us from female Chechen snipers. He was declared mentally unstable, and therefore legally irresponsible. At last, as one of Budanov's lawyers put it, the &quot;smears&quot; of rapist and murderer would be removed.
 When I heard this, I thought to myself that if Andrei Chikatilo - a rapist-murderer who was convicted of torturing, mutilating and cannibalizing 52 victims - had been declared insane instead of being executed, he would nevertheless have remained a rapist and a murderer.
 Why hold this trial? It's pretty clear that the top brass doesn't consider what Budanov did to be a crime for the simple reason that everyone does it.
 Everyone does it because this is war. Not the powdered-wig war of the 19th century with its turning and flanking maneuvers executed by orderly columns of soldiers. Not the air war in Afghanistan, where Americans gun down the Taliban from a safe distance without soiling their uniforms.
 This is a dismal, medieval war, in which everything comes down to a few ancient and very human maxims. They killed my friend; I will avenge him. They killed my mother, my sister, my daughter; I will avenge them.
 This is not war; it is vengeance - an enormous aggregate of many petty acts of vengeance raised to the Nth power by the incompetence of Russia's generals, the egoism of its politicians and the greed of Chechen field commanders.
 So tell me, why are we trying Budanov? To show the West that we have a functioning justice system? The Western stance on the Chechen war doesn't depend on the trial of Colonel Budanov. It depends on a thousand different things - from the current state of Russia's relations with the West to the U.S. military presence in Central Asia.
 Are we trying Budanov to show the Chechens that Russia treats crimes committed against them in the same way it treats crimes against other Russian citizens? We'll never be able to prove that because it's not - and should not be - true.
 We are at war with Chechnya. In his heart every Russian soldier sees the people of Chechnya in the same way the people of Chechnya see him - as a rabid dog who deserves to be shot, but shot in such a way that the free press doesn't find out.
 The Chechens are our enemies.
 Enemies can be deserving of respect. I understand perfectly what I would think about Russia if I were a Chechen woman. But I am a Russian woman, and I have the right to experience those same feelings with regard to Chechnya.
 An enemy is an enemy, and in a war he will always be on the other end of the rifle barrel, of the law and of compassion.
 
 <i>Yulia Latynina is a journalist with ORT and a columnist for Novaya Gazeta. </i>

TITLE: a breath of fresh theater air
AUTHOR: by Peter Morley
PUBLISHER: Staff Writer
TEXT: The arrival of summer gives St. Petersburg a chance to dust off the cobwebs, get out into the open air and enjoy the better weather.
 
This year, another festival is adding to the growing list of outdoor events being held. &quot;Theater Under the Open Sky&quot; has taken over the beach under the Alexeyevsky Ravelin of the Peter and Paul Fortress. Two stages have been created: One is large and formally constructed, while the other is a square area demarcated on the sand, bordered on two sides by the walls of the fortress and on two sides by rows of tiered seating.
 According to Irina Blinova of the City Museum Fund, which is organizing the festival, &quot;Theater Under the Open Sky&quot; aims to &quot;unite all the artistic collectives on one stage.&quot;
 The festival also tries to push boundaries. &quot;This is the first time that we have put on such a festival, and we wanted to show what kind of performance is possible in an open air theater,&quot; says Blinova.
 The companies that are coming to the festival cover a range of different areas. On Tuesday, Pskov's Pushkin Drama Theater performed a historical epic based on the subjugation of Pskov and Novgorod by Ivan the Terrible. The following day, the Mr. Pezho's Traveling Puppet Theater took over the beach with an array of grotesque costumes.
 According to the City Museum Fund's schedule, upcoming shows include a &quot;spiritual orchestra,&quot; and a &quot;little comedy theater.&quot; The fund says that, because the companies invited are free to perform whatever they want, it is not possible to say in advance what will be playing on any one day, beyond the name of the theater company performing.
 Regardless of the quality of the performances - the Pskov company, for example, was fun, but not hugely original - the festival provides an agreeable way to pass an evening. Performances begin at 9 p.m. and last about 1 1/2 hours, so there is plenty of time both to get there and still catch the subway afterward.
 The panorama along the Neva River provides a spectacular backdrop for the festival, and watching the sun set over the fortress is a real pleasure, but there are a couple of practical aspects to note. The first is that, due to being shadowed by the fortress walls, it can get quite chilly as the evening wears on. Secondly, the seating is of a solid wooden variety, so it may be advisable to take a cushion.
 

 <i>
&quot;Theater Under the Open Sky&quot; runs through August 31. Call 232-4298 or 232-6919 for details. </i>

TITLE: the name's bondzinsky ...
AUTHOR: by Sergey Chernov
PUBLISHER: Staff Writer
TEXT: Although local band Bondzinsky has been toting its hard-edged blend of alternative rock for almost 10 years now, its forthcoming album, tentatively titled &quot;Rumba,&quot; will be only the second disc it has released, and the first in four years.
 
The group is also an infrequent performer on the city's club scene. Its concert next Wednesday at Moloko is just its second live outing this year.
 As well as &quot;Rumba,&quot; the band is considering releasing a live album, recorded on its tour of the Netherlands in 2000. Also in the works is a fully instrumental album, which will possibly be released under a different name.
 According to one of the band's two founding members, drummer Igor Mosin, its new songs are in an ironic vein, similar to its old club hit &quot;Give Us Money, Get Some Rock and Roll.&quot; The new album's title song follows the progress of a drunk staggering home in such a way that passers-by assume he is dancing a rumba. &quot;They have silly lyrics, with our particular sense of humor,&quot; he says. &quot;We don't feel the urge to writing messianic or poetic lyrics now.&quot;
 The band hopes to release the album in September, but, for now, there are no serious plans. Mosin, who works as a DJ on Radio Baltika, says that he does not want to follow usual music business rules. &quot;I meet bands who do commercial music and bring it [to the station],&quot; says Mosin. &quot;They say, 'We've recorded five songs, but this one is planned for release in September, and that one for December.' This artificiality is madly irritating. That's why we take things as they come.&quot;
 Bondzinsky has changed its lineup a number of times, going through a dozen guitarists and vocalists, with the band's founders, Mosin and bassist Dmitry Petrov, as the only constant members. 
 However, in the past two years it has stabilized as a quartet, with vocalist Oleg Boiko and guitarist Andrei Gradovich augmenting the founding duo. Saxophonist and clarinetist Sergei Yanevsky also appears, as a guest musician.
 Gradovich, who is also the guitarist in arty pop act Kolibri, played in the seminal 1990s guitar-based trio Jugendstil, and was invited to join Bodzinsky in 2000, when the band had problems with its then-guitarist but had to go to Holland for a series of non-profit gigs in squats.
 &quot;Unlike past lineups, this lineup will probably never change,&quot; says Mosin. &quot;Bondzinsky will most likely die completely or remain in its current state.&quot;
 The band's debut album, &quot;Lobovoi Mainstream&quot; (&quot;Frontal Mainstream&quot;), was recorded with a different singer, Andrei Mashnin of Mashninband, and released only on tape in 1998. The original copies have long since sold out.
 Understanding that the band's musical style will probably never bring in a decent profit, its members also all have day jobs: While Mosin has been spinning discs at Radio Baltika for over 10 years, Petrov is a window-dresser at a sports store, Boiko sells CDs at the Soyuz record shop and Gradovich is a bartender at hip club Fish Fabrique.
 With rare concerts and no recordings available, Mosin admits that the band has difficulty in keeping a consistent following. &quot;We don't have any specific audience now,&quot; he says. &quot;Friends and friends of friends hear [about the show] through the grapevine and come, as well as people who heard us long ago and come out of curiosity. &quot;
 Mosin also says that there is no radio station or music press that reflects the kind of music that bands like Bondzinsky play. &quot;I know a good club band which brings me demos [to play on the radio] and I say, 'Why do you do this? It would be better to give them out to friends and play clubs,'&quot; he says.
 &quot;After all, we are not Zemfira, who is a talented girl, with a well-adjusted lineup of bar musicians - but we all get along well [in the band] and it would be ridiculous to change anything.&quot;
 According to Mosin, the popular alternative band Tequilajazzz, which he describes as an &quot;heroic phenomenon,&quot; is something of an exception to the mainstream-only rule, although he adds that its popularity owes much to its promotion by a Moscow label, as well as two or three hit songs.
 &quot;I don't think any other country has such uniformity as Russia, except probably China,&quot; says Mosin. &quot;When I tell my 14-year-old son, 'Do you know that real punks don't watch MTV?,' he is very surprised. [Russian teenagers] think that the cream of music is on MTV.&quot;
 Without having any grand objective, the members of Bondzinsky just keep doing what they enjoy - playing in a band. &quot;We have no illusions,&quot; says Mosin. &quot;We do it just because we want to, with nobody hurrying anybody.&quot;
 Wednesday's concert will be the last time that the band plays its current set, before it moves on to newer songs when the new album is finally released. 
 
 <i>
Bondzinsky at Moloko, next Wednesday at 7 p.m. Links: www. bondzinsky.spb.ru </i>

TITLE: chernov's choice
TEXT: Johnny Dowd, </strong>the U.S. country-blues singer who plays at Red Club on Saturday, is much anticipated on the local music scene. His work has been compared to Captain Beefheart, Tom Waits and David Lynch's <i>films noir, </i>while there is also talk about his remarkable authenticity.
 
The 54-year-old Dowd started quite late - he bought his first guitar at 30 and released his first album when he was 49.
 His dark songs deal with death, murder and love gone awry, and evoke a wide range of emotions - from laughter to horror. &quot;Funny, scary, and ultimately, highly entertaining,&quot; goes one review. &quot;Sick, twisted ... and genuinely horrifying,&quot; goes another.
 However, the Texas-born, New York-based Dowd - who has spent the &quot;last 20 years or so as a furniture mover, singer and band leader,&quot; according to his autobiography - says that he does not quite live up to public expectations.
 &quot;People have been disappointed that I'm not a mass murderer or something,&quot; he said to The Irish Times last year. &quot;I'd be a more interesting person if I'd killed a few people.&quot;
 In concert, Dowd, who sings and plays electric guitar, will be backed by vocalist Kim Sherwood-Caso - a former hair-salon owner - and a rhythm section.
 Dowd's most recent, third album, &quot;Temporary Shelter,&quot; was released on the Koch label last year. Examples of Dowd's songs can be found at www.johnnydowd.com. 
 Also this week, the three-day <strong>Nu-Jazz Festival </strong>will start at the par.spb club on Friday.
 Nu-Jazz is a style that blends jazz, funk, electronic dance music and free improvization. &quot;Nu-Jazz is to [traditional] jazz what punk or grunge was to rock,&quot; according to www.jazzreview.com. &quot;It makes jazz fun again.&quot; 
 The festival features live acts and DJs, and is headlined by the <strong>Nathan Haines Band. </strong>Haines is a New Zealander, who made a stir in his home country with his innovative band, Jazz Committee, but is now based in London and records with the likes of drum n' bass pioneer Goldie and the Metalheadz crew.
 Other live acts include Estonia's Holmes, Moscow's Moscow Groove Institute and Second-Hand Band and St. Petersburg's own Doo Bop Sound.
 Staying with jazz, the <strong>Jazz Boat </strong>is a local jazz tradition, where musicians and jazz enthusiasts rent a boat and go down the Neva River pumping out jazz classics. The tradition began in 1967 and is still kept alive by Kvadrat - Russia's oldest surviving jazz club, dating from 1964 - and its founder and director Natan Leites.
 Strangely, such jazz activities were tolerated by Soviet authorities, except for one famous occasion, when Leites attempted to organize a boat ride with visiting musicians from the University of North Texas, which was stopped by the KGB in 1976.
 This year's Jazz Boat will feature two stages - the upper deck is reserved for the traditional Alexei Kanunnikov Jazz Band, while the lower deck will be hosting contemporary jazz, as performed by Andrei Kondakov, Mikhail &quot;Uncle Misha&quot; Chernov, Ivan Vasilyev, Nikolai Sizov, Viktor Matveyev and Maxim Nekrasov.
 The boat leaves at 3 p.m. on June 12 from outside the State Hermitage Museum. Tickets cost 200 rubles ($6.45), and are available from the city's theater-ticket kiosks. For more information call 315-9046 or 153-4020.
 
 <i>- by Sergey Chernov </i>

TITLE: new b-52 doesn't bomb
AUTHOR: by Shawna Gamache
PUBLISHER: Special to The St. Petersburg Times
TEXT: Opening a theme restaurant is a risky business. Early imperfections, normally forgiven at recently opened joints, can ruin the whole experience, even for casual diners not concerned with the theme. So it was with interest - and trepidation - that I headed down to B-52, which opened in early April on Ulitsa Lomonosova.
 
B-52 is named for the American bomber - not, unfortunately, for the Athens, Georgia, cult band - and maintains that its interior is of a style &quot;unique to our city but very popular in the West,&quot; and that &quot;men entering the restaurant will feel as though they are in fact inside the fuselage of the bomber.&quot; They don't specify how <i>women </i>will feel, so, pushing aside fears of thematic failure, I decided to see for myself.
 My companion and I entered the dimly-lit restaurant, which, in addition to being modeled pretty convincingly after a fuselage, boasts five four-seater booths made of snazzy new airplane seats. The server, dressed as a member of the Women's Army Corps in a jaunty, navy-colored hat, suit, and short, conservative heels - true B-52 buffs will have to forgive the anachronism of the WWII era WAC; the bomber wasn't actually built until 1952 - and appropriately chipper and sunny, ushered us through the &quot;fuselage&quot; to a booth.
 Although B-52's prices are above average for a Russian eatery, it is actually quite reasonable, given not only the sizable fortune that clearly went into the place, but also the generosity of portions, elegance of presentation, and wide selection offered. My companion and I perused the menu with delight, reading aloud some of the dishes' names, such as &quot;Sex with a Pilot: sausages stuffed with chicken wings and ketchup.&quot; Drink-wise, I ordered a glass of the house white wine for 60 rubles ($1.94) while my companion went for a White Russian at 80 rubles ($2.59). Our server, delighted to have customers in the near-empty restaurant, was almost cloying in her constant doling of helpful advice and incredibly attentive manner.
 The food was presented on shiny, black, octagonal plates, accompanied by matching candle holders, and all of the glasses had shiny black stems. The black salt and pepper shakers nestled in a chubby, silver, aviation-themed holder, its handle curving off suggestively into the sky. The &quot;Stars and Stripes&quot; salad (190 rubles, $6.13) featured small, tasty pieces of seafood, with fresh tomatoes, cucumbers and onion, all of which had apparently been murdered by the mayonnaise that both coated them and swirled artistically around the plate. The &quot;Home Base&quot; (120 rubles, $3.87) was a simpler and more meager selection of tomatoes, cucumber, pepper, onions, lettuce, and feta. Our joint appetizer, the T-joint (95 rubles, $3.06) came just after we had finished our salads and turned out to be quite worthy of entree status by itself, as it consisted of three giant, omlet-like blini, liberally stuffed with fresh ham and mushrooms, in a creamy cheese sauce.
 The main courses were both beautifully presented, and in huge quantity. I had the &quot;Dead Loop&quot; (145 rubles, $4.68), lured by the promise of spicy vegetables atop a steamed pike-perch filet. This was good enough, but not particularly to my liking, as the &quot;spicy vegetables&quot; turned out mostly to be chunks of bacon and a pretty aggressive hard-boiled-egg garnish, supplemented by little shreds of carrot and pepper in a saccharine sauce.
 My companion, assured by the server that it was the tastiest choice on the menu, ordered the &quot;Explosive Wave,&quot; (220 rubles, $7.10) - featuring &quot;the lockets from a beef with the finest liver and french sauce&quot; - and spoke very highly of it. The sauce was smoky and thick, and she enjoyed as much of the meal as she could bring herself to eat. We had also, somewhat foolishly, ordered a generous portion of tasty potato croquettes - called &quot;Change of Course&quot; (50 rubles, $1.61) - thinking that we might need a garnish. 
 We were stuffed and happy at the end of the meal, and watched sheepishly as our ever-smiling server took away our half-eaten main courses. The menu offers a bevy of after-dinner options, with a massive selection of cigarettes, cigars, after-dinner liqueurs, coffees, teas, and desserts. The dessert selection was huge, and would have been quite tempting to those who didn't already feel like a B-52 bomber at the end of the meal. I opted for a cappuccino (24 rubles, about $0.77) and my co-pilot a tea (10 rubles, $0.32). These were lovely, as were the delicious, fresh pastries (15 rubles, $ 0.48) we ordered. After which, getting the bill was remarkably easy, and shelling out the cash for such a satisfying meal even simpler.
 
 <i>
B-52. 5 Lomonosova Ulitsa. Tel: 110-4087. Open Sunday through Thursday, noon to 11 p.m., Fridays and Saturdays, noon to 1 a.m. Dinner for two with alcohol, 993 rubles ($32.03). Menu in Russian and English. Credit cards will soon be accepted. </i>

TITLE: eifman: breaking all the rules
AUTHOR: by Celestine Bohlen
TEXT: In the Soviet Union of the late 1970s, Boris Eifman was an exception - a young, ambitious choreographer who had his own dance company, then known as the Leningrad Ballet Ensemble.
 
What made Eifman even more exceptional was his popular success, which stood out like a beacon at a time when most Soviet artistic culture was mired in stagnation.
 Eifman, now 55 and considered one of Russia's leading modern choreographers, is back in St. Petersburg. His company, now called the Boris Eifman Ballet Theater, performs &quot;Don Quixote, or a Madman's Fantasies,&quot; and &quot;Red Giselle&quot; at the Alexandriinsky Theater this week.
 In &quot;Don Quixote,&quot; as in so many of his ballets, Eifman portrays an individual trapped in a society in which they have no voice. Such themes, in Soviet times, would never have passed the censors. &quot;It was a time when it was necessary to waste a lot of time, and nerves, on a war with fools,&quot; he recalls with a smile. &quot;Now I can look back and laugh, but at the time, it was difficult, very difficult.&quot;
 Eifman's goal when he founded the Leningrad Ballet Ensemble in 1977 was to rock the Soviet ballet establishment - epitomized by Moscow's mighty Bolshoi Theater - out of its complacency and create something new and exciting that would appeal to young audiences.
 &quot;I wanted to use the opportunity to express my ideas about the future of Soviet ballet,&quot; he says. &quot;I didn't have negative feelings toward the Bolshoi Theater, but I did have negative feelings against the bureaucrats who were too afraid for their jobs to risk anything new.&quot;
 Eifman's first ballets were set not to Tchaikovsky but to Pink Floyd, rock music that was practically forbidden in those days. The story lines were provocative, based on the Old Testament or a short story of a soldier ruined by his experience in the Russian army. The movement on stage was emotional, dramatic, sensuous, even erotic.
 Predictably, some critics accused him of producing pornography, not choreography. Also predictably, the performances were a hit, not only in Leningrad but in other parts of the Soviet Union, particularly Moscow. A performance there by the Leningrad Ballet Ensemble filled the 4,000-seat theater at the Rossiya Hotel.
 Several years after he had been urged by the KGB to emigrate, he was refused permission to leave the country when his troupe was invited to tour abroad. That time, the authorities clearly feared that he would emigrate. &quot;It wasn't about me,&quot; Eifman said. &quot;All they worried about was their own jobs and how they would look if I never came back.&quot;
 But the &quot;biggest joke,&quot; as he put it, came in 1987, as perestroika was just gathering steam. That year Eifman submitted a work that depicted a psychiatric ward, a sensitive subject to a regime that had had a habit of declaring its opponents insane. To his utter amazement, the censorship commission accepted the work on the first go-round.
 It was at that moment that Eifman realized that the Soviet system was on the verge of collapse.
 &quot;The year before, they would have sent me to prison for presenting such a work,&quot; he said. &quot;Then suddenly, here I was the hero of the new Soviet ballet. That was when I realized that perestroika had reached the world of the arts.&quot;
 
 <i>
&quot;Don Quixote&quot; plays the Alexandriinsky Theater on Saturday at 7 p.m. &quot;Red Giselle&quot; plays on Monday at 7 p.m. </i>

TITLE: a portrait of a flawed genius
AUTHOR: by Donald Fanger
TEXT: &quot;Monumental&quot; and &quot;magisterial&quot; are words that have surfaced repeatedly in response to Joseph Frank's Dostoevsky project, the first four volumes of which appeared in 1976, 1983, 1986 and 1995. Now, the largest volume, <strong>The Mantle of the Prophet, 1871-1881</strong>,<strong> </strong>covering the last decade of the writer's life, completes the series.
 
Frank's work is, as reviewers have consistently testified, unrivaled in what it sets out to do and in the remarkable degree to which it succeeds in doing it. It is unquestionably the fullest, most nuanced and evenhanded account of its subject in any language, and it has significantly changed our understanding of both the man and his work.
 Frank's originality lies in the way he manages to chart, at the same time, the evolution of Dostoevsky the man, of Dostoevsky the writer, of the writings and of the changing times that did so much to shape all three. Frank writes as a biographer, literary historian, critic and historian of 19th century Russian culture in the belief that only such a multi-pronged approach can yield a proper appreciation of the art that is Dostoevsky's first and ultimate claim on our attention.
 What is unprecedented in these volumes, apart from the wealth of detail, is Frank's perception, as he puts it in his preface, that Dostoevsky's great novels bring into focus all the problems of mid-19th century Russian culture - &quot;not, to be sure, on the level on which they ordinarily appeared to his contemporaries, but transforming them in terms of his own eschatological and messianic vision.&quot; The creative process may be fated to remain a mystery on its intimate side, but Frank shows just how much illumination can come from studying the kinds of transformation he speaks of here.
 The Dostoevsky in Frank's earlier volumes is less eccentric and extreme than he has been taken to be. By toning him down, Frank was clearly trying to combat some cliches about his unbalanced genius. But one result was to make Dostoevsky's circumstances more vivid than his personality or temperament.
 Now, perhaps in tacit acknowledgment that this may have introduced another kind of imbalance, Frank shows a constant readiness to &quot;acknowledge the intemperance that so often overcame him when his nerves were frayed,&quot; his &quot;prickliness of character&quot; (&quot;well known and ill-famed&quot;), his &quot;sudden explosions of uncontrollable rage,&quot; the fact that he was not &quot;an easy person to live with under any circumstances.&quot; More than that, Frank now volunteers judgments: &quot;Dostoevsky could be unpardonably rude&quot;; a &quot;vicious&quot; remark about his rival Turgenev is &quot;slanderous and totally unjustified,&quot; - Dostoevsky at his worst.
 But there is worse. In the period covered by this book, Dostoevsky became a public figure, making speeches, pouring out a stream of highly personal journalism in his &quot;Diary of a Writer,&quot; setting forth an ecstatic vision of Russia as the only bulwark against godless modernity and the Russian people as the only repository of authentic Christianity, destined to bring a new order of love and brotherhood to the inferior peoples of the world, by force of arms, if needed.
 The problem for Frank is that this passionate utopianism carried with it a no less passionate xenophobia, a hatred that, as Frank notes, &quot;extended to every people not of Great Russian origin and is most obvious&quot; - virulent - &quot;in relation to the Jews.&quot;
 Frank gives much uneasy attention to this. Anti-Semitic references, he finds, appear occasionally in the earlier novels, but Frank calls them &quot;not particularly abusive if judged by the standards of his time and place.&quot; He even tries to excuse the casually contemptuous treatment of the Jewish fire fighter who witnesses Svidrigailov's suicide in &quot;Crime and Punishment.&quot;
 But the author's personal loathing for the Jews that erupted in the 1870s is something else. Dostoevsky now took every opportunity to rant against &quot;Yids&quot; and &quot;Yiddism&quot; and to excoriate &quot;the crowd of triumphant Jews and kikes that has thrown itself on Russia.&quot;
 Quoted at length by Frank, this anti-Semitic frenzy makes hard and repulsive reading, and Frank can offer no explanation beyond conjecturing that Dostoevsky may have needed to find a scapegoat &quot;for the disappointments, frustrations and social-economic upheavals that had plunged Russian life into turmoil since the liberation of the serfs.&quot; Repeatedly he brands it as shocking and inexcusable, but he adamantly avoids treating it as integral to Dostoevsky's character or temperament - he does the same with what he calls Dostoevsky's &quot;gambling mania&quot; - concluding only that it leaves &quot;a permanent stain on his reputation.&quot;
 Most interesting in this volume is the picture Frank gives of other changes in the writer and the society he depicted and hoped to influence. Central here were changing beliefs in the new cohort of young radicals that made it possible for Dostoevsky to assume a prophet's mantle. Although, only a decade before, radical young people had rejected moral and ethical considerations in the name of &quot;science&quot; now they were being swept up into the Populist movement and &quot;going to the people&quot; to bring enlightenment.
 This amounted to a reinstatement of moral and ethical considerations. &Icirc;t meant, as Frank puts it, that Socialism was once again - as in the days of Dostoevsky's own youthful radicalism - being regarded as the realization of the ideals of Christ on Earth. Here was a position with which the writer could once again sympathize, as was the populist reverence for the Russian peasantry.
 It was on the strength of these shared beliefs that he was able to find an audience among the younger generation and to gain - despite the reactionary nature of many of his beliefs - a unique position in the life of his country. That he was a bundle of the most startling contradictions only served to underline his independence. It was, Frank contends, a broad public that read the monthly installments of his &quot;Diary of a Writer,&quot; despite the fact that its circulation seems to have stayed under 1,000.
 In it, they found provocative treatments of the questions of the day, interspersed with literary reminiscences and short fictions. Everybody could find something to sympathize with as well as to reject in him. After all, this was the man who had suffered eight years of prison and exile for his earlier radicalism. Besides, whatever else one might say, he was a great novelist and passionately concerned with the fate of Russia.
 Frank is very good on the &quot;Diary,&quot; citing both its appealing and appalling aspects and noting how many of the themes Dostoevsky first broached in it would go into &quot;The Brothers Karamazov,&quot; where their being incarnated by the vivid characters rendered them more problematic, more agonistic and thus less stark and unpalatable. He is, if anything, even better on Dostoevsky's art in this period. He explains the relative failure of &quot;A Raw Youth&quot; as a consequence of the writer's self-censorship once he had agreed to publish it in the leading populist journal, whose readership he wished to court. But the centerpiece is what he calls Dostoevsky's greatest novel, &quot;The Brothers Karamazov.&quot;
 Devoting some 200 pages to this novel, Frank details its evolution in masterly fashion, citing letters and notes to clarify the writer's intentions and showing how the book refracts all his major preoccupations - the conflict between reason and Christian faith, the weakening of the family, the untenability, as he saw it, of moral standards once divorced from religious belief.
 In Frank's analysis of the text, he repeatedly shows how it embodies the novelist's conviction that conveying his sense of reality required not just &quot;realistic&quot; detail and social and psychological accuracy, but the irradiation of all by some transcendent ideal. Frank is acute in pointing out what I would call Dostoevsky's use of concentricities, the way he refracts &quot;a thematic motif through a succession of characters, each of whom expresses a different aspect or level of its meaning.&quot; And he finally dispels the misunderstanding of what makes suffering a positive moral value for Dostoevsky: It was a value for him only if it came from &quot;an inner wrestling with the self.&quot;
 Three months after completing this novel, Dostoevsky, who had long suffered from emphysema, died peacefully in his sleep. His funeral was like nothing Russia had ever seen. Fifteen choirs and some 30,000 mourners from the most disparate levels of society made up the cortege. Frank concludes triumphantly, stressing how, after a decade of being constantly in the public eye, Dostoevsky had finally become &quot;a revered, symbolic figure who seemed to stand above the merciless battle of ideologies.&quot;
 That Frank does not indicate how briefly that moment was to last is a reminder of the exclusions that are the price of his achievement. He makes it possible to appreciate, as never before, the accomplishments of Dostoevsky in his time and place, but there is scarcely a word about his posthumous life in Russia or outside it. Frank gives a vivid sense of the odds Dostoevsky overcame, what he struggled with, the unique cultural phenomenon he became, but he pays virtually no attention to what we don't know - and want to know - about the man and the characters he created.
 Frank's magisterial tone turns Olympian at times, dismissing unnamed critics whose arguments are deplored but not considered. Russian words are flaunted unnecessarily - and not always correctly - in the text. The author of this imposing work, in short, is human: Small wonder that he has left parts of the Dostoevsky puzzle intact. 
 
 <i>
&quot;Dostoevsky: The Mantle of the Prophet, 1871-1881,&quot; by Joseph Frank, Princeton University Press, 784 pages. $35.
 </i>

 <i>
Donald Fanger is the author of &quot;The Creation of Nikolai Gogol&quot; and &quot;Dostoevsky and Romantic Realism.&quot; He is Harry Levin Research Professor of Literature at Harvard University. </i>

TITLE: storybook tale for city of legend
AUTHOR: by Oxana Smirnova
PUBLISHER: Special to The St. Petersburg Times
TEXT: Like many cities in Russia, Pskov is a city of ancient legend: a storybook tale of a princess with a vision.
 
A population center since ancient times, Pskov was settled by Finnish tribes and later by Slavs. By the 9th century it was already a significant regional trading center. But it was not until the 10th century that the city was touched by legend. A certain Princess Olga came to the banks of the Velikaya River and pointed to a spot where rays of sunlight pierced through the clouds and converged. Inspired by this vision, Olga foretold that a great city with a cathedral devoted to the Holy Trinity would be built on that spot.
 Today Pskov is a treasure trove of historical monuments - one that is on the waiting list to be included in UNESCO's register of world cultural heritage sites. International experts identified the city's fortress and the Holy Trinity Cathedral as particularly significant.
 Pskov is an ideal city for a walking tour. The best place to start is across from the fortress on the left bank of the Velikaya River in the Zavelichye neighborhood. From there, you can mount the Olginsky Bridge, which offers a breathtaking panorama of the fortress and Holy Trinity Cathedral that gives a real sense of the city's ancient might and beauty.
 The Holy Trinity Cathedral that was foreseen by Princess Olga has been a symbol of Pskov for centuries. &quot;Where the Trinity is, there is Pskov,&quot; the city's proud residents used to say. And no wonder. The cathedral dominates the city. 70 meters tall, it can be seen from up to 15 kilometers away in good weather.
 The church that survives today, built in 1699, is the fourth to occupy the site. The first Holy Trinity Church was made of wood and, according to legend, was built around 957, during the lifetime of Princess Olga. The stone Holy Trinity Cathedral <i>na Kromu, </i>or &quot;in the fortress,&quot; was built in 1138, during the reign of Prince Vsevolod Gavriil of Novgorod. The original appearance of this cathedral has been preserved in icons painted at the time. The cathedral itself collapsed in 1363 and a new cathedral was built immediately afterward containing a burial vault for outstanding citizens of Pskov. Local princes were also enthroned there. 
 Like many ancient cities, the main attraction is the fortress. Moscow has its <i>Kreml, </i>or Kremlin; Novgorod has its <i>Detinets; </i>in Pskov the fortress is known as the <i>Krom</i>. Unlike the fortresses in other medieval cities, the Krom never housed residents inside its walls. It was designed primarily as a sort of municipal storehouse for food. It was guarded by specially trained watchdogs whose food was kept in the central tower. Stealing from the Krom was considered a serious crime - it carried the death penalty.
 Protected on two sides by the Velikaya and Pskov rivers, the fortress is triangular in shape. The Smerdy Gate - the name probably refers to <i>smerd, </i>an old word for a peasant landholder - stands on the Velikaya side, while the Velikiye Vorota, or Great Gate, faces the Pskov. The Krom's third side was protected by a deep, man-made mote filled with water, called the <i>Greblya</i>, or Dike, above which rose a high wall.
 The entrance to the Krom today is located in its south wall. The broad square that opens inside the gate is packed with the foundations of ancient churches uncovered during excavation work. This is the <i>Dovmontov gorod, </i>a fortress that, legend has it, was built in the 13th century by Pskov's Prince Dovmont-Timofei. A huge number of churches once occupied this relatively small space, but in the late 16th and early 17th centuries they fell out of use and were torn down.
 None of the original buildings in the Dovmontov fortress have survived, save the <i>Prikaznye palaty, </i>or Office Building, built in 1695 on the ruins of the south wall. Recently restored, this building with its extravagant porch makes a very impressive sight. It houses exhibitions and a gallery featuring works by contemporary artists, and is open every day from 11 a.m. to 6 p.m. Visitors can purchase or specially order art works made of ceramic, porcelain and metal materials.
 One of Pskov's oldest architectural gems is the Mirozhsky monastery's Cathedral of the Transfiguration of the Savior, built in 1156. The monastery can be reached on foot in about 30 minutes along the Reki Velikoi embankment, passing by many architectural landmarks along the way. Once you get to the 50-Letiya Oktybrya Bridge, cross over the river and double back to the monastery.
 The monastery's cathedral is renowned for its frescoes. Protected by UNESCO, these frescoes are extremely rare examples of monumental painting in 12th century Rus. The paintings were executed shortly after the cathedral was built, but were later hidden by plaster. It was not until the church was undergoing repair work in 1858 that they were discovered. They were not fully cleaned and restored until the end of the 19th century.
 Once you have explored the treasures of the city, there are a number of equally remarkable attractions outside the city. Pushkin Hills - where the estates and final resting place of beloved poet Alexander Pushkin are located - is 110 kilometers south of Pskov. If you do decide to make the trip, be sure to visit the poet's Trigorskoye and Mikhailovskoye homes, as well as the Svyatogorsky monastery, where Pushkin is buried. 
 A visit to the 15th-century Pskovo-Pechersky monastery - 50 kilometers from Pskov - is also likely to be unforgettable. As the name suggests, it is home to a unique cathedral built inside a cave. Visitors should be aware that this is a working monastery and there are strict rules about appropriate attire: no shorts or revealing clothing allowed.
 Finally, Izborsk, one of the oldest cities in Russia, is just 30 kilometers away. First mentioned in 862, Izborsk is home to some 200 archeological monuments, including a 14th-century fortress. Where to Stay:
 </strong>One of Pskov's best hotels is the Rizhskaya, situated at 25 Rizhsky Prospekt. Tel.: (8112) 46-22-23. A double &quot;semi-luxury&quot; room here costs 1,500 rubles ($50) a night. The less expensive Turist Hotel has a good location, but the accommodation is more spartan. A single room goes for 450 rubles ($15) a night. The Turist is located on the banks of the Velikaya River, across from the fortress at, 4 Ulitsa Paromenskaya, Tel.: (8112) 44-51-51.
 

 <strong>
Where To Eat:
 </strong>Inside the Rizhskaya Hotel is the Andromeda restaurant and a bar that also serves food. The restaurant is open from noon until 2 a.m. and dinner costs around $30 per person. The center of Pskov also has many pleasant, inexpensive cafes and bistros, such as the Cherskaya at 40 Oktyabrsky Prospekt. 
 

 <strong>
How To Get There:
 </strong>The overnight train from St. Petersburg's Vitebsky Vokzal is the best way to reach Pskov. It takes about five hours to get there. A one-way, <i>platskartny </i>ticket costs about 160 rubles ($5.10).

TITLE: Arafat's Compound Struck in Retribution
PUBLISHER: The Associated Press
TEXT: RAMALLAH, West Bank - Israeli troops stormed Palestinian President Yasser Arafat's headquarters early Thursday, blew up three buildings in the sprawling compound, and shelled the Palestinian leader's living area in response to a Palestinian suicide attack on an Israeli bus that killed 17 passengers.
 
A shell or rocket hit about two meters from Arafat's bed, punching a hole through the wall dividing his bedroom and an adjacent bathroom.
 Pointing to his dust-covered bed, broken bedroom mirror and shattered bathroom tiles, Arafat suggested Israel was trying to harm him. &quot;I was supposed to sleep here last night but I had some work downstairs,'' he said.
 &quot;Of course [the Israelis] knew where I was. Everybody knows this is my bedroom.''
 An Israeli Army spokesperson, Captain Jacob Dallal, said Arafat was not the target of the operation. &quot;If there had been any intention of harming Arafat, it would not have been a problem,'' Dallal said.
 Thursday's assault with bulldozers and tanks came just a month after troops withdrew from the compound following a 34-day siege that confined Arafat to several rooms. Though Israel's stated goal at the time was to isolate Arafat and remove him from contacts with the outside world, the virtual house arrest turned him into a heroic figure in the eyes of Palestinians and much of the Arab world.
 There has been speculation that another major Palestinian terror attack would prompt Israeli Prime Minister Ariel Sharon to expel Arafat.
 The Palestinian leader shrugged off such a scenario on Thursday. &quot;Expel me?'' he said. &quot;I will die here.''
 However, other prominent Israelis warn that expelling Arafat might lead to chaos and more violence.
 Thursday's attack on Arafat's compound came in response to a suicide bombing on Wednesday in which a member of the Islamic Jihad group, driving a car packed with 20 kilograms of explosives, pulled up alongside a moving bus and detonated the load, igniting a huge fireball. Seventeen Israelis and the assailant were killed.
 The force of the blast flipped the bus over twice. Many passengers were trapped in burning vehicles, while others were hurled onto the asphalt. Among the dead were 13 soldiers in their late teens and early 20s. &quot;Forever 20,'' read the headline in the Yediot Ahronot daily Thursday, alongside the pictures of the victims.
 The Israeli daily Maariv wrote in an editorial on Thursday that &quot;the blood-boiling spectacle of the people who were burned to death in a bus ... needs to bring us very close to a decision to rid the region of Arafat's presence.''
 Islamic Jihad identified the attacker as Hamza Samudi from the West Bank town of Jenin. Relatives said that Samudi was 18, and that he had learned to drive only four days before the attack.
 Israeli tanks entered Arafat's compound at about 2 a.m. on Thursday. The military said that its forces took control of Arafat's headquarters &quot;in the wake of a wave of Palestinian terrorism sweeping the state of Israel,'' including the attack on the bus. The statement said that the Palestinian Authority is &quot;directly responsible for terrorism that originates in its territory.''
 Troops blew up three buildings, including the Palestinian intelligence headquarters, reducing them to piles of rubble.
 The army said that, during the operation, Palestinian security forces opened fire at Israeli soldiers who returned fire. Palestinian security officials insisted that they did not shoot at the Israelis. One Palestinian security guard was killed.
 Two hours after the Israeli soldiers left on Thursday, Arafat emerged from his office building, flashing a V-for-victory sign as he was greeted by about 100 civilians at the entrance to the building. &quot;This will only increase the steadfastness of our people,'' Arafat said, referring to the Israeli attack.
 Elsewhere in the West Bank on Thursday, Israeli forces left the city of Nablus, which they had entered a week ago to carry out a series of searches for Palestinian militants and caches of explosives and weapons.

TITLE: WORLD WATCH
TEXT: Fighting in Myanmar
 

BANGKOK (Reuters) - Intense fighting in eastern Myanmar between government troops and ethnic guerrillas has killed dozens and threatens to spill over into neighboring Thailand, military sources said on Thursday.
 The Myanmar Army and its allies in the United Wa State Army have been attacking positions held by a rival ethnic group, the Shan State Army (SSA), opposite Thailand's Chiang Mai province, in a battle for territory and for control of the drug trade.
 Thai officials said that more than a dozen shells fired by one or both sides had landed inside Thailand since Tuesday and that many Shan army troops had retreated across the border for medical treatment.
 A Shan source said that his forces had killed about 150 Myanmar and Wa soldiers and wounded many others in heavy fighting along the border since May 20. He declined to give an estimate for the Shan's casualties.
 
 
Sudanese Rebels Killed
 

KAMPALA, Uganda (AP) - Ugandan troops killed 67 rebels in a battle inside southern Sudan, an army spokesperson said Thursday, part of a continuing offensive to wipe out the 15-year-old rebel group.
 A contingent of 150 Lord's Resistance Army rebels came down from their hiding place in the Imatong mountains to search for food and were followed by Ugandan troops, Major Shaban Bantariza said. The two sides fought this week at Owiny-Kibul, 50 kilometers north of the Uganda border, he said, but he did not specify a date.
 Many of the 67 rebels killed were officers, the army spokesperson said, "because we found many abandoned [insignias] bearing ranks of captains and majors." Two Ugandan soldiers were injured.
 
 
Archbishops Apologize 
 

The archbishops of Melbourne and Sydney on Thursday apologized to Australian sexual abuse victims of the Catholic Church.
 The apology comes after claims that Sydney Archbishop George Pell tried to buy the silence of sex abuse victims when he was bishop of the city of Ballarat in the 1990s.
 In the written apology, Pell and Archbishop of Melbourne Denis Hart said their goal was to move "toward healing.'
 "On behalf of the Catholic Church in Melbourne and Sydney, and personally, we apologize, sincerely and unreservedly, to all victims of abuse, and to the Australian community, for the wrongs and hurt suffered,'' the Church leaders said.
 
 
Congo Rebels To Talk
 

KIGALI, Rwanda (AP) - Congolese rebels have agreed to informal negotiations with the government and a rival rebel group that eventually could end the country's nearly four-year civil war, a senior rebel official said on Monday.
 The Congolese government called the rebel move "a good thing.''
 The rebel agreement followed plans by UN Secretary General Kofi Annan to appoint two African mediators to oversee the informal negotiations, said Joseph Mudumbi, foreign affairs chief of the Rwandan-backed rebel Congolese Rally for Democracy, or RCD.
 The informal talks would help define power-sharing arrangements among the Congolese government, rebel groups, political parties and civil society during Congo's transition from war to democratic elections, Mudumbi said. 



TITLE: France on the Edge, but Senegal on a Roll
PUBLISHER: The Associated Press
TEXT: YOKOHAMA, Japan - France's World Cup hopes were left dangling by a thread after a 0-0 draw with Uruguay on Thursday. 
 
Senegal, France's conqueror in the opening game, showed that last week's win was no fluke, by tying Denmark.
 Wednesday also saw a huge shock, with the United States - the worst team at the 1998 tournament - upsetting Portugal - ranked No. 5 in the world - 3-2. Russia also opened its account with an easy, if unconvincing, 2-0 win over Tunisia.
 Forced to play a player down for 65 minutes, after Thierry Henry was ejected, France came close to scoring several times at Busan, South Korea.
 But, without injured star Zinedine Zidane, it couldn't solve goalkeeper Fabian Carini, and now must beat Denmark on Tuesday or else go home.
 The game was the first scoreless tie in this World Cup.
 Senegal tied the Danes 1-1, but outplayed them for much of the game in Daegu, South Korea. The Africans finished with 10 players after Salif Diao was ejected for a hard tackle that brought his second yellow card of the game.
 Senegal fell behind, when Jon Dahl Tomasson converted a penalty kick in the 16th minute for his third goal of the World Cup. But the Africans wore done the Danish defense, penetrating often before a brilliant play led to Diao's goal.
 Henri Camara took possession deep in the Senegal end in the 52nd minute. The final of a series of passes went from Khalilou Fadiga to Diao, who slid between two defenders and used the outside of his right foot to beat goalkeeper Thomas Sorensen for the goal.
 Senegal needs only a tie in its final group game against Uruguay to advance to the second round in its first World Cup.
 &quot;The players had a great match and it was a big achievement,&quot; coach Bruno Metsu said. &quot;In the second half they showed all their talent and teamwork. It's a big victory for Africa.&quot;
 Another African team also won Thursday. Cameroon edged Saudi Arabia 1-0 at Saitama, Japan, making the Saudis the first team eliminated from the tournament.
 However, the Saudis performed more professionally Thursday than in an 8-0 loss to Germany. The only goal was scored by Samuel Eto'o in the 65th minute as he sidestepped two defenders. If Cameroon beats Germany on Tuesday, it will advance.
 Only Senegal's 1-0 opening victory against France matched the United States' 3-2 win over Portugal in the first round for shock value.
 The Americans quickly turned their focus to the future on Thursday, just hours after their biggest World Cup win since beating England in 1950.
 &quot;We got to enjoy it last night and now it's back to business,&quot; said Brian McBride, who scored the winner against Portugal on a powerful header.
 The U.S. scored in the fourth minute, led 3-0 by the 36th and held on for a stunning victory over Portugal in the opener for both teams.
 &quot;We came out quick,&quot; said McBride. &quot;They are a very good team, so we put the pressure on them. We took advantage of our chances and when they came on strong, we held them off.&quot;
 The Americans were without offensive standouts Claudio Reyna and Clint Mathis, who were both injured.
 But, from the beginning at Suwon, South Korea, the United States team was the aggressor.
 With John O'Brien's early goal, it had already matched its scoring total in 1998, when it lost all three first-round games, bickering all the way.
 It didn't stop producing after O'Brien left-footed in a rebound from close range.
 In the 29th minute, a shot by Landon Donovan deflected in off a Portuguese defender.
 Then McBride converted a cross from Tony Sanneh, and even the Americans were marveling at their lead.
 Portugal quickly got one back, then got a second-half own goal when defender Jeff Agoos deflected a cross past goalkeeper Brad Friedel
 Ireland grabbed some attention, too, with its last-minute goal for a 1-1 tie with Germany.
 The Germans seemed set to be the first team to advance to the second round, but Robbie Keane knocked home a backheaded pass from Niall Quinn following a long pass from Steve Finnan.
 &quot;I'm extremely angry and disappointed. When you're 1-0 up with one minute to go and concede a goal, it hurts,&quot; said German coach Rudi Voeller.
 Russia beat Tunisia 2-0 at Kobe, Japan, getting goals five minutes apart by Egor Titov and Valery Karpin, the second on a penalty kick.
 Russia was unconvincing in the first half, and almost fell behind on a defensive mixup before halftime.
 However, the introduction of Dmitry Sychyov early in the second half injected some much-needed speed into the attack.
 Sychyov claimed an assist on the first goal and was felled for the penalty.

TITLE: Lakers Are Starting To Find Finals A Little Bit Too Easy
AUTHOR: By John Nadel
PUBLISHER: The Associated Press
TEXT: LOS ANGELES - For the Los Angeles Lakers, old hands at the NBA Finals, the electrifying tension just wasn't there. This might as well have been another home game in January.
 
But, with Shaquille O'Neal under the basket, all was right with the two-time defending champions, who beat the New Jersey Nets 99-94 in the opener of the best-of-seven series.
 In a town built on entertainment, there was little drama to be found Wednesday night, even when the Nets rallied from a 23-point deficit to make things close.
 &quot;It seems like a regular-season game - just going through the motions,&quot; Lakers guard Brian Shaw said.
 O'Neal finished with 36 points, 16 rebounds and four blocks.
 &quot;What adjustments can we make?&quot; asked New Jersey's Lucious Harris, seemingly at a loss at how to stop O'Neal.
 &quot;You're talking about the most dominant player on this planet,&quot; added Nets star Jason Kidd.
 In the last period, O'Neal had 14 points and nine rebounds and was 8-of-16 from the line. He hit 12-of-21 free throws for the game.
 The Nets twice got as close as three points in the fourth quarter. Such a finish didn't seem likely when the Lakers rolled to a 15-point lead in the first eight minutes and extended it to 42-19 with seven minutes left in the half.
 The fast start surprised their coach.
 &quot;I thought we were real vulnerable, knowing the kind of energy we expended in that last series,&quot; Phil Jackson said. &quot;I got them revved up for the first quarter, but we kind of let up on the gas.&quot;
 The Nets outscored the Lakers 75-57 to finish the game, but it wasn't enough.
 Kobe Bryant, who scored a quiet 22 points, saw the game the same way as Jackson. &quot;We came out, started the game with the intensity and the type of focus that we had in the last series,&quot; Bryant said. &quot;It carried over to start the game. Then, we kind of let it die down.&quot;
 The popular belief was that the Nets, so potent at the beginning of their games against Boston in the Eastern Conference finals, would do it again. This time, the opposite took place.
 &quot;I give my guys a lot of credit because we could have folded the tent and went back to the arena and waited for Game 2,&quot; Kidd said. &quot;We got our feet wet, so hopefully we can work on the start of the game.&quot;
 Like his teammates, Kidd got off to a slow start with four points, one rebound and two assists in the first quarter. He finished with 23 points, 10 rebounds and 10 assists for the 14th triple-double in NBA Finals history and the first since Charles Barkley of Phoenix in 1993.
 &quot;When we had to pick it up, we did,&quot; O'Neal said. &quot;We just have to maintain our composure and keep it going, keep fighting. We know what it takes to win.
 &quot;This game was sort of a feeling-out game. We're a little disappointed in ourselves, but the first game is out of the way and I'm sure the second one will be better.&quot;
 New Jersey closed within four points when rookie Jason Collins made two free throws with 2:26 remaining, and the Nets got the ball back on Derek Fisher's turnover. But Kidd missed a three-pointer and Keith Van Horn stepped out of bounds as he was shooting a three.
 Two free throws by O'Neal and a basket by Rick Fox off a feed from Bryant made it 95-87 with 1:11 to play.
 The Nets were outrebounded 31-19 in the first half and made only 7-of-16 free throws in the first three quarters. They shot 8-of-10 from the line in the final period.
 &quot;I think the guys were probably a little nervous,&quot; Scott said. &quot;The last time we were nervous was the first game of the playoffs against Indiana.&quot;
 Fox added 14 points and Fisher had 13 for the Lakers, who trailed only once - at 2-0. Van Horn scored 12 points and Todd MacCulloch had 10 points and eight rebounds for the Nets.

TITLE: Red Wings Clipped As Carolina Takes 1-0 Lead
PUBLISHER: The Associated Press
TEXT: DETROIT - Ron Francis, one of the few Carolina Hurricanes players who matches the Red Wings' stable of superstars in Hall of Fame credentials, scored 58 seconds into overtime as the Hurricanes surprised the Detroit Red Wings 3-2 in the Stanley Cup finals opener Tuesday night.
 
&quot;We are excited, very excited,&quot; said Jeff O'Neill, who set up Francis' goal and scored the tying goal in the second period. &quot;We've got a lot of young guys playing in the finals for the first time, so to get the first one is good.&quot;
 Tuesday was Francis' first finals game in 10 years, or since he scored the game-winner for Pittsburgh in its Game 4 clincher against Chicago in 1992. The goalie that night was Dominik Hasek, now the Red Wings' goalie.
 &quot;We knew that, over the course of the series, we would have to win one game in here,&quot; Hurricanes coach Paul Maurice said. &quot;I thought we were nervous in the first period ... but that we felt more comfortable as the game went along.&quot;
 Especially when the game went into overtime. The Hurricanes have won seven of eight overtime playoff games, the most since 1993 Stanley Cup champion Montreal won 10.
 &quot;I think we just play our system and keep it simple,&quot; O'Neill said of the Hurricanes' overtime success. &quot;Obviously, we don't try to open up too much. We just try to grind it out for wins, and it's worked so far.&quot;
 That system is a trapping, neutral zone-clogging 1-2-2 defense that prevented odd-man Detroit breaks. What it didn't stop was power plays, but Detroit was only 1-of-7 with the man advantage.
 &quot;You can analyze it any way you want, but we had a chance to win it on the power play,&quot; Red Wings coach Scotty Bowman said. &quot;We didn't play as well as we wanted, that's for sure.&quot;
 Still, they played well enough to lead 1-0 and 2-1 on goals by Sergei Fedorov and checking line forward Kirk Maltby, but O'Neill tied it at 2 by scoring on a short breakaway with only 50 seconds left in the second period.
 Hasek couldn't stop the biggest shot of the night, even as Carolina goalie Arturs Irbe was turning aside 23 of 25 shots in his first cup finals game.
 The Red Wings now know the series won't last four games - unless they're the team being swept, rather than the one doing the sweeping.

TITLE: Mays Is Next for Bonds After 587th Homer
PUBLISHER: The Associated Press
TEXT: SAN FRANCISCO - The next step might take some time, even for Barry Bonds. Willie Mays is still at least a season away.
 
After a rapid rise up the career chart the past two years, Bonds hit his 587th homer Wednesday, an astounding grand slam that gave him sole possession of fourth place and sent the San Francisco Giants to a 12-2 win over the San Diego Padres.
 &quot;It was a big day, especially to do it on a grand slam, that's pretty awesome, especially that monumental of a home run,&quot; Giants manager Dusty Baker said.
 Bonds moved out of a tie with Hall of Fame outfielder Frank Robinson. The San Francisco slugger passed 10 players on the home run list last season and three this year.
 Bonds, who set the single-season record with 73 home runs last year, is exactly 73 behind Mays, his godfather, for third on the career list.
 Bonds' high-arching homer in the third off Dennis Tankersley (1-2) hit the bottom left side of the scoreboard 29 rows beyond the right-field wall at Qualcomm Stadium.
 In the 15 seasons that homers have been measured there, only Mark McGwire has hit one farther, a 147-meter line drive into the second deck in left-center on July 20, 1998. The seat that McGwire's homer hit is painted white with a red circle in the middle.
 
 <strong>
Boston 11, Detroit 0. </strong>A little more than a year after he lost his job as Boston's closer, Derek Lowe seems certain to return to the All-Star game. Lowe won his AL-leading ninth game Wednesday night, allowing just two infield singles as the Red Sox beat the Detroit Tigers.
 
Lowe, born in Dearborn, Michigan, pitched just six innings in the rain before a crowd of 15,537 at Comerica Park.
 &quot;I had about 30 friends and family here,&quot; he said. &quot;I'm sure everyone saw them. Because with the weather, there were only about 45 people here, and they were all friends and family of someone in the game.&quot;
 Last season, Lowe blew two saves in April, compiling a 1-4 record. This April, Lowe no-hit Tampa Bay. With the All-Star game a month away, Lowe, an All-Star reliever in 2000, has an ERA of 1.81, lowest in the AL.
 &quot;We have a lot of confidence when Derek is out there,&quot; Johnny Damon said. &quot;Once we get a run for him, we know he will do the job.&quot;
 In other games, it was: Atlanta 6, New York Mets 4; Arizona 5, Houston 4 in 13 innings; Colorado 8, Los Angeles 6; Chicago Cubs 5, Milwaukee 1 in 10 innings; Florida 2, Philadelphia 1; and Montreal 3, Pittsburgh 1; Baltimore 4, New York Yankees 3; Cleveland 6, Minnesota 4; Tampa Bay 8, Toronto 6; Chicago White Sox 6, Kansas City 1; Seattle 5, Oakland 0; and Anaheim 7, Texas 5 in 10 innings.

TITLE: SPORTS WATCH
TEXT: Triple Crown Chaser
 

ELMONT, New York (Reuters) - War Emblem will start Saturday's Belmont Stakes from post position 10 in his bid to become the first horse to win the Triple Crown in 24 years. Ridden by Victor Espinoza, War Emblem is the even-money favourite in the 12-horse field.
 Trainer Bob Baffert was delighted with Wednesday's draw at Belmont Park, where his Triple Crown dreams have been frustrated twice before.
 "I wanted an outside draw," Baffert said. "I'd rather be on the outside than the inside. He's a fast horse and he can dictate whatever he wants to do."
 Proud Citizen, the runner-up at the Kentucky Derby and third at the Preakness, drew post nine on Wednesday and has attracted odds of 5-1. Perfect Drift, third at the Kentucky Derby but absent from the Preakness, drew post six and odds of 8-1.
 "It made very little difference whether he [Perfect Drift] was inside or outside," trainer Murray Johnson said. "I have no regrets on missing the Preakness. He's a three-year-old gelding and I just wanted to space his races. He's coming into this race in great shape and we've got a very good chance."
 
Lewis Keeps Cool
 

MEMPHIS, Tennessee (Reuters) - Lennox Lewis, who meets Mike Tyson on Saturday in what is being touted as the richest world heavyweight title fight of all-time, feted the world's media in style at a Mississippi casino, then served up a delicious response to profanity-laced attacks aimed at him by the former champion's trainers.
 Soothing piano music, place settings and a feast of sirloin and lamb served by white-gloved waiters greeted the media as they arrived for Lewis's training session. The relaxed meal was followed by a carefully orchestrated press conference, during which Lewis happily fielded questions, before losing a game of chess to a member of the Oakhaven School Lennox Lewis Chess Club.
 The scene was in sharp contrast to the chaos surrounding Tyson's one scheduled meeting with the press a day earlier. After grunting his way through a 10-minute workout, the self-proclaimed "Baddest Man on the Planet" slipped out of a side door without uttering a single word.
 Tyson left the ring to his trainers, who directed profanity-laced barrages at Lewis, accusing the Briton of being a "bitch" and a "coward."