SOURCE: The St. Petersburg Times
DATE: Issue #846 (14), Tuesday, February 25, 2003
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TITLE: Security Council Is Back At Work
AUTHOR: By Edith M. Lederer
PUBLISHER: The Associated Press
TEXT: UNITED NATIONS - Seeking UN approval for military action against Iraq, the United States, Britain and Spain submitted a resolution Monday declaring that Iraqi President Saddam Hussein has missed "the final opportunity" to disarm peacefully.
British Ambassador Jeremy Greenstock formally submitted the resolution to the Security Council on behalf of the three countries.
But France, Russia and Germany, which oppose the war option, circulated an alternative plan to pursue a peaceful disarmament of Iraq over at least the next five months. China said it also supports that proposal.
The rival positions set the stage for a heated battle over whether the council would back the U.S. and British demand for war now or the French, Russian, and German call for war to be "a last resort."
Getting approval for the U.S.-backed resolution will be a daunting task. To pass, the resolution must have nine "yes" votes and avoid a veto by France, Russia or China. Eleven of the 15 council members want to see UN weapons inspections continue; Bulgaria is likely to support the U.S.-British-Spanish plan.
U.S. Secretary of State Colin Powell urged China to support the new resolution at meetings with top officials in Beijing on Monday, but the Chinese stood by their long-held position that UN inspections should continue.
The draft resolution does not set any deadlines. But U.S. and British officials made clear they want the Security Council to vote by mid-March.
The resolution declares that Iraq has failed to take advantage of its last chance to disarm peacefully and, therefore, must face the "serious consequences" the Security Council threatened in Resolution 1,441, which was adopted unanimously on Nov. 8.
The new resolution recalls that "Iraq has been and remains in material breach of its obligations" under UN resolutions.
It also recalls that the council decided on Nov. 8 "that false statements or omissions" in its 12,000-page declaration to UN weapons inspectors "and failure by Iraq at any time to comply with, and cooperate fully in the implementation of that resolution, would constitute a further material breach."
The resolution notes that the council has repeatedly warned Iraq "that it will face serious consequences as a result of its continued violations of its obligations." It also observes that Iraq's Dec. 7 weapons declaration contained "false statements and omissions."
The resolution acts under Chapter VII of the UN Charter, making it militarily enforceable. It does not call for "all necessary means" to be used against Iraq.
Instead, its only enforcement paragraph would have the Security Council decide "that Iraq has failed to take the final opportunity afforded to it in Resolution 1,441."
French diplomats said the French-German-Russian plan, which includes strengthened UN weapons inspections, can be implemented under existing UN resolutions and would be submitted as a memorandum.
"The aim is to establish a timetable for Iraq's disarmament, program by program, relating to weapons of mass destruction," French President Jacques Chirac told reporters in Berlin before talks with German Chancellor Gerhard Schroeder.
"The Security Council must step up its efforts to give a real chance to the peaceful settlement of this crisis," the French, Russian and German paper said.
Despite the contrasting positions, Britain's Greenstock introduced the resolution at a closed council meeting Monday.
"We will be allowing a good period of up to two weeks, or maybe a little more, before we will ask for a decision," British Foreign Secretary Jack Straw said in Brussels, Belgium. "We want an international consensus."
U.S. President George W. Bush told U.S. governors earlier Monday that the resolution "spells out what the world has witnessed the last months. The Iraq regime has not disarmed. The Iraqi regime is not disarming as required by last fall's unanimous vote of the Security Council."
He pressed the council to adopt the resolution.
"It's a moment for this body ... to determine whether or not it's going to be relevant as the world confronts threats in the 21st century. Is it going to be a body that means what it says? We certainly hope so," Bush said.
Bush said the administration will work with the Security Council "in the days ahead" on the resolution. He did not set a timetable, although his spokesperson said Britain's calls for a mid-March vote were fine.
Nonetheless, the next six days are critical for Hussein.
Top UN inspectors Hans Blix and Mohamed ElBaradei say Iraq still isn't fully cooperating or providing evidence to answer outstanding questions about its nuclear, chemical, biological and long-range missile programs.
To demonstrate that Iraq is cooperating, Hussein must not only show that Iraq is doing more to answer those questions. He must also comply with Blix's order to begin destroying all of Iraq's al-Samoud 2 missiles and the engines and components for them by Saturday.
Iraq has withheld a decision on destroying the missile program, but its chief liaison to the UN inspectors, Lieutenant General Hossam Mohamed Amin, said in Baghdad that the government is "serious about solving this."
Blix told Associated Press Television News before a meeting Monday of his advisory board: "We have set the date for the commencement of the destruction of these missiles and we expect that to be respected."
The chief inspector apparently chose Saturday deliberately: It is also the deadline for his quarterly written report to the Security Council on Iraq's cooperation and the status of weapons inspections, which resumed in early November after four years.
TITLE: Cards Muddy Visa Entry Process
AUTHOR: By Claire Bigg
PUBLISHER: Staff Writer
TEXT: A new immigration-card system for foreigners in Russia that came into effect on Feb. 14 may make life a little more difficult for holders of Russian visas who regularly leave and re-enter the country. The system, introduced in line with new legislation targeted at reducing the number of illegal aliens in the country, has already generated some confusion, with the responsible agencies often providing inaccurate or conflicting information.
All foreigners planning to spend more than three days in the country are now issued the cards upon entering Russia, in compliance with new laws governing the issuance of visas, residency and work permits that came into effect Nov. 1. last year. The card consists of two parts, the first of which - indicating the person's name, date of birth, gender, nationality, address or host organization in Russia, and purpose and length of stay - is collected immediately at the issuing immigration-control point, and the second of which - carrying the same information, plus an indication on the back that the foreigner is legally registered in Russia - must be submitted upon leaving the country.
Through the end of last week, about 9,000 migration cards had been distributed to foreigners arriving by air, rail or automobile at the seven points in the Northwest Region currently handing out the cards.
"One of the aims of the new law is to bring order to migration processes here," said Mikhail Utyatsky, the director of the Visa and Passport Service at the St. Petersburg and Leningrad Oblast branch of the Interior Ministry, at a press conference last Thursday.
"All foreign citizens who enter Russia, not only our region, now receive a migration card," explained Andrei Lovyagin, the deputy director of the Migration Department at the St. Petersburg and Leningrad Oblast branch of the Interior Ministry. "Registration, for foreign citizens, will be put on these cards."
While the cards will help the government keep track of registration for foreign residents who are not required to have visas to enter Russia - for the most part, citizens of countries in the Commonwealth of Independent States (CIS) - they may create difficulties for those foreigners with multi-entry visas for Russia, particularly if they leave and return to the country frequently. In response to a question from a British citizen on Thursday, Lovyagin said that the registration stamp for these people will also be on the card, implying that a new registration stamp has to be obtained with each new card.
But many specialists say that requiring visa holders to re-register every time they enter the country is unrealistic.
"Under the law, foreigners with multi-entry visas have to get re-registered every time they leave the country. In practice, this is nonsense," said Natalya Safronova, an associate with the St. Petersburg office of the law firm Salans, said in a telephone interview on Friday. "There are foreign businesspeople who leave the country and return regularly and who cannot, realistically, get registered every time."
"In order to remedy this situation, the Interior Ministry is going to have to issue more detailed information," she added.
Safronova said that foreigners with visas will have their registration stamped inside their passports as before, with an indication of some sort on the back of the card that this is the case.
Mikhail Tyurkin, the deputy head of the Interior Ministry's Federal Migration Service, confirmed that foreigners holding multi-entry visas will only have to register once, but could not provide specifics on how this will be arranged.
All foreigners living in Russia for whom a visa is not required and who entered the country before the card system was introduced - as well as those with visas who have either lost the second card or, for whatever reason, didn't receive one - will have to go to an immigration office to pick one up.
"In order to be registered by passport and visa services, foreign citizens who have not received migration cards have to receive them at the Migration Control Department, at 14 Smolyachkova Ulitsa," Lovyagin said. "We will be distributing the cards until May, and there are long queues right now."
Foreigners not required to have Russian visas will have to carry the immigration cards. Those found to be without the cards by law-enforcement officials face fines, or even deportation.
"The deportation measures are not new, as the law on deportation has been in force since 1981. Today, foreigners who fail to be registered within three days after their arrival without good reason can be deported to the country from which they arrived," said Utyatsky.
According to Utyatsky, as many as 200,000 people currently live in St. Petersburg and the Leningrad Oblast without legal registration.
Although the new law is aimed at cracking down on the number of illegal immigrants to Russia, the measures for deportation and fines stipulated by the new law have drawn some criticism.
"Some countries decide to carry out an amnesty process, where all foreigners living in the country illegally are invited to come and be registered. This enables the country to monitor immigration questions effectively," Antonina Chetverikova, the head of the Labor Migration Department at the St. Petersburg and the Leningrad Oblast Immigration Service, said in an interview after the press conference on Thursday. "But Russia is obviously not ready to do this."
Although Interior Ministry officials in St. Petersburg say that the confusion over the immigration-card system will be cleared up within a few weeks, there have been reports of foreign citizens from CIS countries being denied the cards, as well as attempts by border guards to sell the cards on trains.
The U.S. Embassy in Moscow has even advised American citizens who entered Russia before the cards started being distributed to get migration cards at their local passport and visa offices.
"The police will not necessarily understand the fine points of the law, and they have already begun to stop foreigners and check for migration cards. In several cases, even though the foreigner did not need to have a migration card, the police detained the foreigner and, in two cases, demanded bribes," said Howard Solomon, the Chief of American Citizen Services at the U.S. Embassy in Moscow in early February.
Solomon said that the Federal Migration Service had advised the embassy that foreigners who arrived before the cards where handed out should get cards anyway to avoid problems with checks by the police.
Officials at the Finnish, U.K. and U.S. consulates in St. Petersburg said on Friday that they have yet to advise their citizens on how to deal with migration cards, saying they were waiting for more detailed information from the Russian authorities.
Staff Writer Robin Munro contributed to this report from Moscow.
TITLE: Investigation Tagets Latest Vice Governor
AUTHOR: By Vladimir Kovalev
PUBLISHER: Staff Writer
TEXT: The Northwest Region Prosecutor's Office has initiated a criminal investigation for abuse of office against Vice Governor Valentin Mettus, the head of the City Hall Sports and Communications Committee, making him the fifth high-ranking official - and the second to hold that post - to come under its scrutiny within last two years.
While Prosecutor's Office representatives say that they are just doing their jobs, City Hall authorities insist that the Kremlin is using the Prosecutor's Office to undermine Governor Vladimir Yakovlev by discrediting the circle of officials around him.
The case, initiated on Feb. 6, concerns a deal signed in 1999 between the Sports Committee and Nevsky Plant, a local pump and turbine producer, for the purchase of an uncompleted sports complex. According to the agreement, the Sports Committee transferred 1.25 million rubles (about $40,000) to the Alternative financial agency, a company acting as a go-between in the deal that was supposed to complete the financial arrangements but, later, disappeared - along with the funds.
"Article No. 286, part 3 [of the Russian Criminal Code] deals with abuse of power leading to severe negative consequences. No charges have been filed yet, but we believe that Mettus is guilty, and the Prosecutor's Office will address the issue soon," said Vladimir Zubrin, the Northwest Region Prosecutor, in an interview published in the Novaya Gazeta weekly on Sunday.
In the interview, Zubrin countered charges that the case was part of a campaign to discredit Yakovlev and his administration.
"There are no political reasons for cases of this kind, [and] this type of casedoesn't come out of the blue. We carry out intensive research before acting, with the amount of material examined reaching thousands of pages at times," he said, "We understand that cases against high-ranking officials attracting significant public attention. That's why we check the facts numerous times."
Mettus said he that was particularly perplexed by the nature of the case, given the amount of attention President Vladimir Putin has given to questions of sports and fitness in Russia.
"It seems that our law-enforcement agencies are somehow out of touch with the real-life situation in the country," Mettus said Friday, in an Internet forum hosted by the Web site Sportspb.ru.
"The president of the Russian Federation declares that sports development is a national priority, which would naturally call for improvements to our [sports] facilities and the purchase of new equipment but, at the same time, we have what we have," he said.
Mettus is the fifth deputy governor to be investigated by the Northwest Region Prosecutor's office since April, 2002, when federal investigators filed a case against Victor Krotov, the head of the City Hall Financial Committee, also on charges of abuse of office.
Anatoly Kogan, the head of the Health Committee, was charged with negligence last March, and Valery Malyshev, who headed the Sports and Communications committee earliers, was charged with abuse of office in July, 2001.
Malyshev died in May last year of a stroke, which City Hall said was a result of constant pressure from the Northwest Region Prosecutor's Office.
In November 2001, the prosecutor's office initiated a case against Alexander Potekhin, the acting Media Committee head at the time. The case was dropped shortly after Potekhin left the post.
Although none of the cases has led to a conviction, analysts see the Northwest Prosecutor's Office's activities as a clear sign that local allies of the federal government are getting stronger in the city.
Leonid Kesselman, a political analyst at the Sociology Department of the Russian Academy of Sciences said the allies are getting ready to take over power in City Hall in the next gubernatorial elections, scheduled for May 2004.
"This is a ongoing tug of war between two centers of power, one of which, it seems, has more resources. This suggests a result where one group of people, the one close to [Moscow], will grab [City Hall]," Kesselman said in a telephone interview on Monday.
TITLE: Zorkin Back as Chief of Constitutional Court
AUTHOR: By Natalia Yefimova
PUBLISHER: Staff Writer
TEXT: MOSCOW - A controversial former chief judge of the Constitutional Court, who quit in 1993 after unsuccessfully opposing President Boris Yeltsin in his violent stand-off with rebellious lawmakers, was elected to the post once again on Friday.
In a surprising decision, 10 of the court's 19 judges cast their ballots for Valery Zorkin, who served as the court's first chairperson for nearly two years after its creation in October 1991 and has remained a judge on the court ever since. Zorkin, 60, replaces Marat Baglai, whose second three-year term had come to an end, forcing the vote. Baglai got the nine other votes.
The mild-mannered but fiery-eyed Zorkin, whose professional qualities won praise from across the political spectrum, took the decision in stride, saying it came as something of a surprise.
"I hope this isn't perceived as the advent of a person who fought for this job. This happened by chance," Zorkin told the Kommersant newspaper. "The Constitutional Court is a truly collective body, with 19 equal judges."
Nearly a decade ago, Zorkin stepped down from his post as court chairperson on Oct. 6, 1993 - two days after troops loyal to Yeltsin opened fire on the parliament building where the president's armed opponents had been holed up for several days - saying he could not stay on "under the current circumstances."
In the months leading up to the bloody stand-off, as the conflict between Yeltsin and conservative lawmakers escalated, Zorkin had tried repeatedly to mediate between the president and parliament, headed at the time by Speaker Ruslan Khasbulatov.
As attempts at reconciliation failed, Yeltsin issued his infamous decree No. 1,400, disbanding the Supreme Soviet and calling for new parliamentary elections. On Sept. 21, 1993, the Constitutional Court, with Zorkin presiding, declared the decree unconstitutional, and said it gave legal grounds for stripping Yeltsin of his powers.
The ruling immediately became a battle cry for Yeltsin's foes, including Khasbulatov and Vice President Alexander Rutskoi.
Two weeks later, with more than 100 dead, the president prevailed.
Zorkin's first stint as court chairperson came at a time when Russia was trying to redefine itself - a time when legal and political changes were intimately intertwined - and his critics, including Yeltsin, scorned him for getting too involved in politics.
Before he became court chairperson, during the coup d'etat against Mikhail Gorbachev in August 1991, Zorkin joined a group of legal experts in condemning the revolt as unconstitutional. More than a year later, in November 1992, the Constitutional Court stymied Yeltsin's attempts to disband local Communist Party cells and to confiscate the party's property.
Now, Zorkin says, the court is resolute about keeping its nose out of politics, as it has since 1994.
"This will be the court's unwavering line. Nobody should bother hoping that we can be pulled to the left or the right or to the political center. We are in the legal center," Zorkin said in an interview with Rossiiskaya Gazeta.
"History never repeats itself," he told Kommersant. "Sound-minded people must learn their lessons from those events [of 1993]. If they don't, they should quietly leave the scene and write memoirs. I don't intend to write any memoirs; I'm a working judge."
Legal experts and politicians of all stripes welcomed Zorkin's appointment.
"I personally hope that, under its new chairperson, the Constitutional Court will be more independent," State Duma Deputy Vladimir Lukin of the liberal Yabloko party told Interfax. "[These hopes] significantly outweigh any fears that Mr. Zorkin will display the overly strong political prejudices that he showed in the early 1990s."
Communist leader Gennady Zyuganov praised Zorkin as "honest, courageous and a man of dignity."
"The choice is perfectly understandable. No-one doubts his professional qualities," Sergei Vitsin, who authored some of the first post-Perestroika legal reforms under Yeltsin and now serves as deputy chairperson of the presidential advisory council on improving the court system, said in phone interview Friday.
Zorkin said there may be some small changes to the court's work, but there would be no revolutions.
Asked whether he believed changes should be made to the constitution, Zorkin replied: "If you don't learn to live by one constitution, you will never learn. Although, perhaps, there are certain things in our constitution that need greater balancing, but that is an issue of political expediency."
While most observers saw Zorkin's election as a "natural rotation," especially considering that Baglai had managed to ruffle plenty of feathers in the judicial community, Kommersant interpreted the appointment as a signal that the court wants to free itself from Kremlin pressure.
"Over the course of Marat Baglai's leadership, the Constitutional Court did not make a single decision unsuitable for the Kremlin," the paper wrote in its Saturday issue. "By electing Valery Zorkin, the judges have shown that they want greater independence from the Kremlin ... and the Presidential Administration will have to take that into account."
One test of that thesis could come as early as this spring, the paper said, when the court is due to consider a Communist challenge to a recently passed law banning nationwide referendums in the year preceding parliamentary or presidential elections.
TITLE: IN BRIEF
TEXT: Mideast Road Map
MOSCOW (AP) - Foreign Minister Igor Ivanov on Friday warned against trying to modify the "road map" for a Mideast peace settlement, and a top Palestinian representative said the Palestinian authority was calling for a one-year suspension of violence.
"Any changes made by anyone would only push the settlement process back for a long time. This must be prevented," Ivanov was quoted as saying by the Interfax during a joint appearance with Mahmoud Abbas, Yasser Arafat's deputy in the Palestinian Liberation Organization.
The United States, Russia, the United Nations and the European Union - the so-called Quartet - have crafted a "road map" toward peace that includes plans for a provisional Palestinian state to be established in 2003 and a permanent entity formed by 2005.
Israel's Haaretz newspaper reported Thursday that Israel wants more than 100 changes in the road map. In response, Ivanov said the road map might not fully satisfy either Israel or the Palestinians, but "the essence of the compromise is that this 'road map' opens the way to a peaceful settlement of the conflict."
Two Suspects Cornered
ROSTOV-NA-DONU, Southern Russia (AP) - Two suspects in the killing of four police and two civilians this week were cornered in a manhunt Friday that left one of them dead and the other wounded, officials said.
The men were sought in the Wednesday attack on a police patrol in the Krasnodar region, killing four officers and two hunters who were helping in the search for illegal boar hunters.
One gunman also was killed in that attack, and the other two escaped. About 1,500 police subsequently combed the region.
Vladimir Chernenko, a spokesperson for the Interior Ministry's southern Russian division, said shooting broke out when the fugitives were confronted Friday and that one was killed and the other wounded.
The attack was originally thought to be related to poaching, but police later discovered large amounts of marijuana and a cache of automatic weapons in one of several camouflaged mountain hideouts the suspects apparently used for drug trafficking, officials said.
Election Dates
MOSCOW (Reuters) - Russians will vote in a presidential election on March 14 next year, after voting in a parliamentary election Dec. 14, the country's top electoral official said on Friday.
Alexander Veshnyakov, addressing a news conference in the southern city of Rostov-on-Don, said he expected four or five candidates to contest the presidential election.
Three Chechen Groups
MOSCOW (AP) - The U.S. State Department has added three Chechen organizations to its list of banned terrorist groups, Secretary of State Colin Powell confirmed. In an interview late Thursday with Rossia television, Powell said the United States was "sensitive" to Russia's concerns about terrorism and was working closely with Russia and Georgia to try to erase the threat.
Russian officials were pleased by the decision, which has been the subject of U.S.-Russian talks for some months.
"This will help eradicate seats of terrorism in Chechnya, block channels of financial support and become another important indication of strengthening practical cooperation between Russia and the United States in resisting international terrorism," Foreign Ministry spokesperson Alexander Yakovenko said Friday.
TITLE: Russia Celebrates Role of Country's Army
PUBLISHER: The Associated Press
TEXT: MOSCOW - Shadowed by the war in Chechnya and rising fears of an assault on Iraq, Russians on Sunday honored the army on Defender of the Fatherland Day with solemn ceremonies, boisterous marches and festive gatherings.
President Vladimir Putin laid a wreath at the Tomb of the Unknown Soldier at the Kremlin walls, accompanied by Belarussian President Alexander Lukashenko, Kazakh President Nursultan Nazarbayev and Ukrainian President Leonid Kuchma.
He then went to the Burdenko military hospital to visit service personnel being treated for wounds suffered in Chechnya.
"I'm sorry I had to come to the hospital for this holiday," Putin told the soldiers in footage broadcast on television, as the soldiers listened unsmilingly.
In a grim coincidence, Defender of the Fatherland Day is also the day that Chechens and their Ingush neighbors were deported en masse to Central Asia on Josef Stalin's orders in 1944. The deportation is one of the prime sources of Chechens' historical resentment of Russia.
More than 400 Chechens gathered in the Chechen town of Gudermes to remember the anniversary, Itar-Tass reported. In Ingushetia, residents also commemorated the day with Ingush President Murad Zyazikov noting that "the love for native land and the spirit were not broken" by the deportations.
Fearing that Chechen separatists might launch an attack to remember the day, federal forces clamped down with tight security measures in Grozny, where far fewer people than usual were on the streets on Sunday, Interfax reported.
An estimated 300 people rallied in Moscow against the war, Ekho Moskvy radio reported.
A separate march and rally of leftists Sunday focused largely on calls to ensure that the military stay out of any attack on Iraq.
"This war may undermine the entire system of international security to which Russia sacrificed 27 million lives," Communist Party leader Gennady Zyuganov told the rally, referring to the Soviet Union's estimated losses in World War II. Russia must demonstrate "will and character" to resist the threat of war in Iraq.
Defense Minister Sergei Ivanov, also visiting the Burdenko hospital, said the Kremlin is not planning to increase the country's combat readiness and "we are doing everything possible to prevent the war," Interfax reported.
The holiday was observed in light-hearted ways as well. In the Vladimir region, hundreds of veterans took part in a cross-country ski race. In Rostov-na-Donu officials had a special train take veterans on a tour of the city while being served soldier's porridge and a ration of 100 grams of vodka, Itar-Tass reported.
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Putin on Friday urged military officers to keep a closer watch over their men to prevent hazing, and the Union of Right Forces announced a new fund offering legal aid to victims.
"If we take at least 10 or 20 cases to court and punish those who harass and torture conscripts, that would help improve the situation in the military," said SPS leader Boris Nemtsov.
The fund was established jointly by SPS and the Soldiers' Mothers Committee. It will start working in Moscow, and branches will open later in several other cities, Nemtsov said at a news conference.
Vicious hazing of young conscripts by older soldiers has permeated the armed forces, leading to an increasing number of suicides, shootouts and other violent crimes. Hazing was named as a likely cause of violence Thursday at a Siberian missile base, in which a conscript killed four fellow servicemen and then shot himself, Krasnoyarsk Governor Alexander Khloponin told Itar-Tass.
Nemtsov said hazing had left 20,000 conscripts injured last year.
"The scale of harassment is staggering. [The number of injured] equals three divisions," Nemtsov said.
Soldiers' Mothers head Valentina Melnikova said the new fund would pay lawyers to defend the hazing victims.
In a speech before military officers Friday, Putin reaffirmed that the nation needs "professional, well-trained and well-equipped armed forces" and said that the military needs to be streamlined.
In a reference to hazing, he said military officers should work harder with personnel and "establish contact with soldiers" to prevent it, Itar-Tass reported.
TITLE: Matviyenko Preaching To Wrong Audience
AUTHOR: By Thomas Rymer
PUBLISHER: Staff Writer
TEXT: Deputy Prime Minister Valentina Matviyenko joined the long list of uprooted St. Petersburgers who have left their new digs in Moscow for a short while to grace their hometown with their views on the prospects of the upcoming 300th-anniversary celebrations. In what appeared to be a departure from the comments made by the other members of the Northern-Capital Kremlin club, Matviyenko was refreshingly upbeat about what's in store. But thinking a little more about what she had to say spoiled the effect of the attempt for me.
The majority of the deputy prime minister's comments last week focused on the number of foreign dignitaries that will be in the city during the week of the celebrations and the measures that the federal government's representatives are taking to try to keep their presence from cramping the style of the city's celebrants. Happy birthday!
But, on reflection, it really started to annoy me that President Vladimir Putin would pick this time to file a load of European and CIS dignitaries into his hometown at all. There's no question that previous meetings here with world leaders - U.S. President George W. Bush and French President Jacques Chirac (I wonder what the odds would be of him being able to get them here together now?) - has done a lot to raise the city's profile.
But to invite a bunch of them to come here during the city's anniversary seems a little bit to me like overkill. This is one time when the city shouldn't really need the extra help. The fact that, except for brief outings to the Mariinsky Theater and the State Hermitage Museum, the politicos plan to spend the whole time in working meetings, seems to defeat the whole purpose of a birthday party. Sure, it will keep them out of the rest of our way - or so Matviyenko promises - but it seems to me a bit of a slight for the occasion.
The second thing that was a little annoying was a brief aside Matviyenko delivered to the journalists present just before leaving the press conference. It was the Russian government version of the old good cop/bad cop routine. In what must have been her best schoolmistress tone, she admonished all present to try not to be so negative and to stop paying so much attention to questions concerning money management in relation to the anniversary preparations - to stop worrying about "every little kopek"! She wants us to look at the bright side and be positive. Happy birthday!
I'm not sure what news programs she watches regularly or how much she and her colleagues in Moscow discuss what they do when they're out of the office, but she must realize who the main sources for a large number of the negative stories have been. She would have been better off giving the speech in the Kremlin, where she would have had a better chance of gathering together in one room Economic Development and Trade Minister German Gref, Federal Audit Chamber President Sergei Stepashin, Gosstroi President Nikolai Koshman and, not least of all, Putin himself - all of whom have slammed the preparations and Governor Vladimir Yakovlev over the last few months.
It's a little tough to be positive when the federal government seems to have made it it's goal to provide a regular, weekly update on everything that it thinks is going wrong.
TITLE: Deputy PM Adopts Reassuring Tone About Celebrations
AUTHOR: By Claire Bigg
PUBLISHER: Staff Writer
TEXT: Deputy Prime Minister Valentina Matviyenko said on Thursday that preparations for the city's 300th-anniversary celebrations were being carried out effectively, but that the federal commission in charge of prepararing for the large number of official guests expected for the occasion was overloaded. She said that the tallest order has been making sure that everyone has somewhere to stay.
"Forty five foreign leaders have been invited to the anniversary celebrations. Leaders of EU and G-8 countries will be accommodated in the buildings of the Konstantinovsky Palace. Leaders of EU candidate countries will be accommodated on a boat that, according to initial information, will be anchored on Angliskaya Naberezhnaya," Matviyenko said Thursday during a briefing after meeting with members of the Legislative Assembly. "The leaders of the Commonwealth of Independent States countries will also be accommodated on the boat."
According to Matviyenko, the administrations of the heads of state or government of the United States, China and India have asked for accommodation in city hotels. The official Russian delegation from Moscow will comprise no more than 10 people, Matviyenko said.
Twenty four of St. Petersburg's 135 hotels have been chosen by the government to accommodate official guests during the period at the end of May and the beginning of June, as well as four boats and the Konstantinovsky Palace, which is being turned into a presidential residence in the suburb of Strelna. Hotels have until March 15 to sign contracts for accommodating foreign delegations. Matviyenko said that tourists were welcome to take part in the festivities, and to stay in the other hotels.
But, even if tourists manage to get a room during the festivities, getting to the city may not be guaranteed, as the influx of foreign delegations will also put a severe strain on Pulkovo Airport. On May 30, leaders of Commonwealth of Independent States countries will meet for a summit in St. Petersburg. According to Matviyenko, the summit will take place on the boats where the foreign leaders will be staying. In the evening, they will visit St. Isaac's Cathedral and attend a concert at the Mariinsky Theater.
On May 31, almost all events involving foreign dignitaries will be held outside the city, Matviyenko said. This includes the Russia-EU summit, which is to take place at the Konstantinovsky Palace. A water festival on the Neva River, which was described by Matviyenko as one of the biggest events during the 300th-anniversary festivities, is also planned on May 31, as well as a visit to the State Hermitage Museum.
On May 30 and 31, Pulkovo Airport will have to handle between 100 and 120 planes carrying foreign delegations, Matviyenko said.
"On these days, the planes will be landing at intervals of 10 minutes," she said. "Some of the flights to and from Pulkovo, perhaps even all of them, may have to be canceled from May 30 to June 1."
However, trains, including commuter trains, will function normally during the period, with the possible exception being the commuter train traveling to the suburb of Peterhof. The tracks to Peterhof cross Volkhonskoye Shosse, which will serve as an alternate route for official guests from Pulkovo to Strelna.
To avoid creating traffic on the city, foreign leaders will travel to Strelna by hydrofoils specially adapted to accommodate the official guests.
"Official guests will travel mainly by water, so there will be no need to obstruct traffic in the city center, with the exception of the usual security measures that are taken during visits by heads of state," said Matviyenko.
Matviyenko said that excessive traffic problems are unlikely, as foreign leaders planning to take part in the summits at the end of May in St. Petersburg will have little free time for sightseeing.
"The presidents are not coming to St. Petersburg on an excursion, they are coming to work," she said. "Their program is scheduled down to the minute."
"If they want to visit something individually or dedicate something in relation to the anniversary, we will try to minimize the possible inconvenience this would create for city residents and organize the program in order not to close the whole city," she added.
French President Jacques Chirac, for example, is planning to open the Voltaire Room in the Russian National Library, and dedicate the Lighthouse of Peace, a gift from France, on Sennaya Ploshchad.
TITLE: Priest Denied New Residence Permit
PUBLISHER: The St. Petersburg Times
TEXT: Russian authorities refused to renew a residence permit for a Roman Catholic priest who had been working in Russia for 10 years, church officials said Monday.
Pushkin city police told Father Bronislaw Czaplicky, a Polish citizen, to leave the country in two weeks, Reverend Igor Kovalevsky, head of the confederation of Catholic priests in Russia, told Gazeta.ru on Monday. Pushkin is in the Leningrad region.
Authorities had offered no explanation for denying Czaplicky a residency permit, Kovalevsky said.
Kovalevsky warned of labeling the incident as deportation
"Father Bronislaw will just have to return to his homeland, get another Russian visa and return back," he was quoted by Gazeta.ru as saying.
The denial of Czaplicky's residency permit is the sixth case in the past year of a foreign-born Catholic priest being banned from visiting or staying in Russia.
TITLE: Duma OKs Regional Reform Bill
AUTHOR: By Natalia Yefimova
PUBLISHER: Staff Writer
TEXT: MOSCOW - After some four hours of debate, the State Duma on Friday gave preliminary approval to two Kremlin-backed bills introducing sweeping reforms to local and regional government.
The plan, which would more than double the existing number of municipalities, has been touted by the Kremlin as a way of bringing government closer to the people, making it more accountable and ensuring that it sticks to its fiscal promises.
The new legislation calls for the introduction of a two-tier system of municipal government and a rigid delineation of powers among federal, regional and local authorities. It also requires the allocation of specifically earmarked funds for any financial obligations handed down to municipal governments from the federal or regional level, such as for education and health care.
The bills' main author, presidential Deputy Chief of Staff Dmitry Kozak, told lawmakers that part of the reform's aim is to ensure that regional and local authorities abide by their budgets and fund everything they are supposed to. If they don't, federal authorities will have the right to take over certain functions of regional governments, and the regions, in turn, will be allowed to take over some of the responsibilities of municipal authorities.
"Such a mechanism is necessary if the mechanism of regions' political responsibility for budget policy does not work," Kozak said in televised remarks.
Although the bills passed on first reading with a large margin - vote counts of 269-128 and 269-139 - they stirred up plenty of controversy. Opinion was split in both Duma committees in charge of evaluating the legislation
Vladimir Lysenko, a member of the Russia's Regions group and deputy chairman of the federative affairs committee, staunchly opposed the bills, saying that federal authorities were trying to centralize power further and to concentrate all the major sources of budget revenue in their own hands.
The Communist bloc and most deputies from the liberal Union of Right Forces party, or SPS, voted against the reform, saying it would lead to a costly and chaotic transition period.
"Let's first solve our larger social problems, like maintenance and utilities, and only then spend huge amounts of money on building a European model of local self-government," SPS leader Boris Nemtsov told Rossia television.
Even the bill's supporters said major amendments would be required before the second reading.
After approving the legislation, the Duma appealed to Prime Minister Mikhail Kasyanov to submit amendments to the federal budget and Tax Code by April 1, news agencies reported.
If passed by both houses and signed into law, the reform would take effect in 2005.
TITLE: Population Falls With Soaring Death Rate
PUBLISHER: The St. Petersburg Times
TEXT: MOSCOW - Despite a post-Soviet record in births, the population decreased by 856,700 last year, as the death rate soared to a high not seen since World War II, the State Statistics Committee said. As of Jan. 1, the population has slumped 0.6 percent to 143.1 million people, the committee said in a preliminary report issued Friday.
According to the report, 1,396,800 babies were born in 2002, an increase of 85,200 from the previous year. But the number of deaths also grew, from 2,254,000 in 2001 to 2,331,400 in 2002.
The State Statistics Committee, without giving numbers, said the birth rate was a decade-long high and the death rate was the highest since World War II.
It said last year's population decrease was about the same as in 2001.
"The changes were not so significant and did not reverse the overall unfavorable demographic situation in the country and in the regions," the committee report said, Interfax reported.
In other statistics, the report said the number of immigrants fell from 193,400 in 2001 to 184,600, while the number of foreign migrants dropped from 121,100 to 106,700.
The number of internal migrants fell 5.8 percent to 2,016,700.
According to Federal Migration Service data, the total number of registered refugees in the country was 505,700. Of them, 43 percent came from Kazakhstan, 12.9 percent from Uzbekistan and 8.9 percent from Tajikistan.
TITLE: Heads of State Talk New Economic Zone
PUBLISHER: Combined Reports
TEXT: MOSCOW -- President Vladimir Putin and the leaders of three other former Soviet republics signed a declaration on Sunday putting forth their intention to take economic cooperation a big step forward and create a free-trade zone.
The declaration said that the move was motivated by the desire to raise the standard of living in the region and by the need for sustained development. Belarussian President Alexander Lukashenko put it more bluntly, saying that the four states' goods weren't needed anywhere outside the region.
"We are taking concrete steps to protect our markets, to protect our states," Lukashenko told reporters in the Kremlin. "We understand that we are of no use to anyone except our own countries and peoples and will defend our markets in any way that we can."
All four countries have struggling manufacturing sectors and troubled agricultural spheres. Ukraine and Belarus have not succeeded in following other former Soviet republics, such as the Baltics, in reorienting their markets toward the European Union; they are unwilling to either do away with widespread subsidies or take on the political and market reforms necessary to be welcomed into the European club.
If they are to enjoy the benefits of big markets at all, they'll have to turn to Russia, the biggest economic power in the region. But the establishment of a wider market embracing all four countries will require legislative amendments and the abolition of tariffs that in some cases are quite high, such as Russia's measures to prevent the dumping of highly subsidized Ukrainian pipes.
The countries already belong to myriad organizations established to promote integration in the former Soviet Union. But those organizations have been largely ineffective, said Kazakh President Nursultan Nazarbayev.
He said that instead of increasing trade, Kazakhstan last year had seen a 12-percent drop in trade with Russia and a 23-percent decrease in trade with Ukraine. In spite of their membership in a number of trade-promoting organizations, he said, Kazakhstan-Belarus trade was just beginning.
"I would like to hope that this is a completely new breakthrough in our relations," Nazarbayev said.
In their declaration, the four leaders said that an agreement to form the free-trade zone would be ready by September. By that time, their governments should have negotiated common economic policies, harmonized legislation and created an interstate commission on trade and tariffs, the statement said.
Putin, perhaps mindful of regional fears of Russian domination, said that the commission would be based in Kiev and headed by a Kazakh official. He also said that other interested members of the Commonwealth of Independent States, a loose grouping of former Soviet republics, would be welcome to join.
All stressed that the body was not intended to replace the CIS.
"I do not, under any circumstances, want to give the impression that we are creating a new four-strong body within the CIS," Ukrainian President Leonid Kuchma said.
(AP, Reuters)
TITLE: Investors Snap Up $1.75-Bln Gazprom Corporate Bond
PUBLISHER: Combined Reports
TEXT: LONDON - Gazprom raised $1.75 billion on Friday in what is thought to be the largest corporate bond in emerging-market history.
Investors, the Financial Times reported, watched in astonishment as the gas giant's 10-year international bond sale was oversubscribed by an estimated six times and increased in size by 75 percent ahead of launch in response to bumper demand from buyers on both sides of the Atlantic.
"The deal seems to have been massively oversubscribed," said Jean-Dominic Butikofer, emerging-market fund manager at Julius Baer Asset Management in Switzerland.
"We could see the bond flying a few points if people are running after the deal."
The deal pays a coupon of 9.625 percent and was priced at par. It was lead-managed by Morgan Stanley and Dresdner Kleinwort Wasserstein
The bond had been quoted up to 2.5 points above its reoffer price in the gray market, before being freed to trade, he said.
Earlier on Friday, ahead of the formal launch of the bond, fund managers were reporting demand of $6.5 billion.
Gazprom, the world's largest natural-gas producer, confirmed plans in January to sell the Eurobond, which is also eligible for private placement into the U.S. under rule 144A.
The deal is one of the largest ever sold by a sub-investment grade company. Gazprom is rated B+ by Standard & Poor's, well below investment grade, limiting the potential audience for its debt.
The size of the new bond crept up in stages, with three different sizes mentioned on Thursday, and a size of $1.75 billion announced at the beginning of Friday's session.
Gazprom plans overall borrowings of $4 billion this year, $1 billion of which will be collateralized by export revenues and thus not be sourced from international bond markets.
"Gazprom wants to borrow $3 billion this year. So they may take advantage of that demand, and reopen this bond after a few days or a few weeks," said Julius Baer's Butikofer.
He warned that a significant further increase to the deal's size could cap any price gains, however.
Gazprom has about $6 billion of debt to repay in 2003, and has said that it will use some of the proceeds from Friday's bond to reduce short-term debt.
Russian companies borrowed $5.1 billion between January and September 2002, according to the Russian Central Bank, with Eurobond issues by Gazprom and other oil and gas-producing firms accounting for one third of that total.
Friday's deal reached a wider investor base than is typical for a new emerging market bond.
"We're not big users of emerging-markets debt, but this particular deal looks attractive to us," said Ronald Bringewatt, portfolio manager for TimesSquare Capital Management Inc. in New York.
Russian corporate bonds are in demand because the state is not borrowing, while high prices for Russia's key oil and gas exports have boosted Central Bank coffers, raising the value of Russian debt as a whole.
Last week, the Russian Central Bank reported record reserves of $51.4 billion, up $1.2 billion, their seventh-consecutive week of gains.
(Reuters, SPT)
TITLE: LUKoil Buys $398M Minority Stake
PUBLISHER: Combined Reports
TEXT: MOSCOW - Top oil firm LUKoil said on Friday that it had bought a small stake in an affiliate for a generous $398 million to further consolidate assets, but analysts questioned the deal's transparency.
Analysts said that LUKoil, which launched an ambitious restructuring and cost-cutting plan last year to improve its image and catch up with market peers, agreed to buy back a minority stake from unknown buyers in Russia's largest such transaction.
"It seems to be the largest sum ever spent in Russia to buy back a stake from minority shareholders," said Kaha Kiknavelidze from Troika Dialog brokerage.
LUKoil said that it had agreed to fully buy PFPG-Energy, a company that owns 27 percent of one of its upstream subsidiaries, LUKoil-Perm, for $398 million in cash.
"LUKoil agreed to pay $60 per barrel of LUKoil-Perm production and $1.0 per barrel of reserves, which is slightly higher that the Russian sector average," said Bulat Karimov from Aton brokerage.
"But, given that we are talking about a minority and not a controlling stake, the premium seems to be huge," he added. Analysts have also questioned the way the deal was done, as doubts remained over the sellers' identity.
(Reuters, SPT)
TITLE: Following the Trail Of Magadan Gold
AUTHOR: By Catherine Belton
PUBLISHER: Staff Writer
TEXT: KUBAKA GOLD MINE, Magadan - Just two days before Magadan Governor Valentin Tsvetkov was gunned down in broad daylight on Moscow's Novy Arbat last fall, Kinross Gold Corp., the Canadian majority shareholder in the region's biggest gold venture, announced that it had reached an agreement with Tsvetkov to buy out its aggressive new partners.
The deal was meant to put an end to more than a year of corporate-takeover attacks from the partners, who have been linked to powerful St. Petersburg precious-metals group Polymetal, the same raider that pushed another Canadian company out of a Magadan silver mine in 2000.
It was also to ensure the long-delayed repayment of a $45-million gold loan issued by the regional administration to the gold venture, Omolon.
But, then, the buyout's key broker was killed. "For a moment, we wondered whether this was the start of a major attack. We wondered whether we should be evacuating," said Scott Anderson, Kinross' site manager at Omolon's mine. "For a moment, we wondered whether the killing had anything to do with us."
Kinross stayed. But its buyout deal has been in limbo for months. Refusing to deal directly with the new shareholders, Kinross needed the regional governor to get the deal through.
It may never be clear whether indeed there was a link between the Kinross deal and the killing of Tsvetkov on Oct. 18. But what is clear is that Kinross' experience in Magadan, where the governor had the power to crush any business and where fortunes could be made on political ties alone, is a telling example of why, in a region once teeming with Canadians prospecting for gold, foreign investors are now few and far between.
With a new governor elected last Sunday in Magadan, Kinross' future will be watched closely by investors wondering if they should dip their toes back in as the gold market heats up. Prices have soared almost 40 percent since 2001.
"Russia would be No. 1 in the world for gold miners. But, because of politics and the lack of clear laws, people have been staying away," said Jim Sullivan, the Magadan head of Bema Gold, another Canadian firm that owns a much smaller mine, Julietta, in the region.
After months of waiting to see whether there was a future for its $175-million investment, Kinross is finally seeing its buyout move forward.
However, problems still loom. It is not clear whether Kinross is to get the go-ahead for a 100-percent stake in the company as planned under the original deal, said Vyacheslav Moskvichov, who took over from Nikolai Dudov as acting governor when Dudov ran for the post and who had been Tsvetkov's closest aide since he came to power in 1996. Dudov won the election last Sunday.
What's more, Kinross' license for Omolon's chief asset, the Birkachan gold field, which could contain up to 100 tons of gold, has been under attack. Polymetal, the company that Kinross says was connected to the legal attack on Omolon, is now competing for the field, Moskvichov said.
Polymetal denies that it has made any moves on the field, and denies that it had any connection to the legal onslaught against Kinross.
Magadan law enforcers refused requests for interviews. The Moscow investigator Novoseltsev, interviewed by telephone, would only say that repayment of the gold loan was one of the versions being investigated.
Moskvichov, who was with Tsvetkov in Moscow the night before his death, said that he did not want to talk about whether the Kinross deal could have had anything to do with the murder.
In a region rich in gold, silver, fish and oil, and where Tsvetkov tried to control most major businesses, possible motives for his killing are plentiful. "Wherever there is gold, there is always crime," Moskvichov said.
Law enforcers have said that they are also looking into Tsvetkov's activities distributing lucrative fishing quotas. Federal prosecutors on Thursday arrested the head of Magadan's state fishing-research institute, Alexander Rogatnykh, and accused him of siphoning off millions of dollars in state funds, in a case opened as a result of the investigation into Tsvetkov's murder.
Prosecutors also have been looking into Tsvetkov's attempts to crack down on a local gold-smuggling ring. Kemal Musoyan, reportedly a major player on Russia's illegal gold market, was found shot dead in Moscow just 12 hours after the governor. According to some reports, Musoyan controlled illegal gold produced in the far northeast, including Magadan and Chukotka. Experts estimate that up to 30 percent of Russia's gold production is sold illegally.
Other observers have pointed to the reported ambitions of Roman Abramovich, Sibneft's major shareholder and Chukotka's governor, to spread into neighboring Magadan. The Kremlin has long-term plans to merge Magadan back together with Chukotka.
There could be a link, too, to the Kinross deal. But, as ever in Russian takeover stories, those links are murky. MDM Bank, which is often seen as being linked to Abramovich because its loan book is dominated by Sibneft and his metals giant Russian Aluminum, provided Polymetal with a $40-million credit line - all its financing needs - for its Dukat silver mine in Magadan. Polymetal now owns the silver mine, the biggest in Russia, after a vicious corporate battle with Canada's Pan American Silver.
Polymetal, in turn, is connected to the Moscow-based company Kaskol, which represented the Omolon shareholders trying to push out Kinross. Kaskol worked with Polymetal in the controversial 2000 takeover of Dukat, which sits above the world's third biggest silver deposit, with a value of $2.5 billion.
Local observers say that Polymetal and Kaskol appeared to be trying the same tactics with Kinross, buying out Kinross' former Russian partners and then initiating a slew of lawsuits contesting the registration of the company's shares in a bid to push out Kinross. That is, until Tsvetkov, under pressure from the Finance Ministry, agreed to Kinross' buyout proposal. MDM, Kaskol and Polymetal, however, deny this.
MDM denies any shareholder links to Abramovich or Polymetal. "There are no relations between shareholders. Polymetal is a completely different project; it does not belong to MDM," said Anatoly Meshcheryakov, a spokesperson for MDM Group. MDM denies any involvement in Kinross' troubles, as does Polymetal. "We did not play any role in this at all. We advised Tsvetkov on some matters, that was all," said Alexander Nesis, president of IST Group, the holding company that owns Polymetal. He said that Polymetal had good relations with Kaskol and MDM, but no ownership links.
Vladimir Butkeyev, Magadan's representative in the State Duma, said that it makes sense for the interests of powerful Moscow groups to be mixed up in the killing. "It seems that the contractor for this murder must have come from Moscow. To organize a killing in the center of Moscow on Novy Arbat, a thoroughfare with a heavy police presence, takes a lot of money. To commit a crime like that, a great deal of money has to be involved," Butkeyev said.
"It's quite likely that Tsvetkov stood in the way of a major Moscow group," he said.
For Kinross, however, the killing capped a treacherous ride in Magadan's gold industry.
On a remote site 340 kilometers from the Arctic Circle, reachable in winter by a 300-kilometer ice road and in summer only by air, Kinross hoped that its investment in Omolon's Kubaka gold mine would become a model for how foreign investment and know-how could boost production in the region.
With $175 million in funding from the EBRD, OPIC and ABN Amro Bank, the Canadians in 1997 brought in 19 Caterpillar heavy-construction vehicles and built a plant with the capacity to mill 2,100 tons of gold ore per day, using state-of-the-art refining equipment from Canada. Omolon Acting General Director Hal Kirby said that the company also invested $5.5 million in infrastructure to protect the environment.
Soon, production soared, reaching 13.5 tons in 2001 to make Omolon Russia's second-biggest gold producer and help boost Magadan as a whole to become Russia's largest gold-producing region. In comparison, Magadan's next biggest gold mine, Susuman Gold, produced just 4.5 tons in 2001. The Julietta mine, owned by Canada's Bema Gold, produced 3 tons last year.
The Kubaka site is a far cry from the gulag gold mines of the Stalinist era, when prisoners were shipped to Magadan's port and sent north along the Road of Bones to dig for gold and die.
At Kubaka today, the mine's 230 workers live in modern housing with pool tables, video rooms, saunas and a gym. Safety is taken very seriously. The mine had just one accident last year.
But Omolon got into trouble almost as soon as it went into full production in 1998. With gold prices way below the level set when the deal was drawn up, Kinross' original Russian partner, Geometal Plus, was unable to pay off a $45-million gold loan. It had received the loan in 1994 from the regional administration as part of a federal lending program to boost Magadan's gold sector, and used it to finance a 25-percent stake in the venture.
Tsvetkov went on the warpath. He claimed that Geometal Plus had received the gold loan because of its owners' ties to his predecessor as governor, Viktor Mikhailov, and fumed that Kinross was paying off its foreign loans while its Russian partners were not paying theirs to his administration. He filed a series of lawsuits to try to force Geometal Plus to pay the loan all at once.
Klavdy Kukharuk, general director of Geometal, the parent company of Geometal Plus, said that this would have bankrupted the company. Geometal Plus put forward a number of proposals to restructure the debt, and paid off a first tranche in 1998, but Tsvetkov's administration turned it down, he said.
In 2001, the Audit Chamber, investigating the nonreturn of the gold loan, noted that the regional administration seemed reluctant to reach a restructuring agreement with Omolon.
Under pressure from a barrage of lawsuits to force full payment, the majority shareholder in Geometal Plus - Western Pinnacle Mining, owned by Canadian Glenn Whiddon - gave up and sold the stake in June 2001 to five little-known Russian shell companies.
"These people were well known to the former governor of Magadan," said Kinross Vice President John Ivany.
"We lost our business," said Kukharuk, sitting behind his desk in his Magadan office and mulling the ruins of his company, now in liquidation after once being the region's primary and most well-connected gold company.
"Geometal Plus was sold to Kaskol. Politics forced the sale. We had paid one tranche of the gold loan. We had an agreement with Omolon that we would pay back the rest. But what stopped us was the group that wanted Kubaka and Birkachan. This was big money."
Ivany said that he met with the representatives of Kaskol on several occasions in an attempt to resolve the conflict. "These were the same people that kicked Pan American out of Dukat ... Mostly they were people from St. Petersburg connected to Polymetal," he said.
"We decided we could not deal with them," said Ivany, saying that they had demanded cash up front before any share transfer.
Kaskol President Sergei Nedoroslev attributed Kinross' troubles at Omolon to not paying off the gold loan. "Why should the foreign banks get paid like clockwork and not the administration?"
He confirmed that Kaskol had been working with the five Russian companies that bought out Geometal Plus, but said that Kaskol walked away from the deal a year ago, when talks with Ivany failed. Nedoroslev said that he doubted Omolon's troubles could have had anything to do with Tsvetkov's killing. "People never get killed because of major deals. It's always something petty," he said.
Undeterred by the breakdown of talks, the new shareholders filed a series of lawsuits against Kinross for $45 million, claiming that their shares in the company had not been properly registered. By September 2002, Magadan's arbitration court had ruled to freeze Omolon's accounts and its gold inventory, leaving the mine almost at a standstill as its workers went without pay.
Canadian Trade and Industry Minister Pierre Pettigrew led talks with Deputy Prime Minister Viktor Khristenko during a state visit last year to try to get Kinross' problems on the agenda of the federal government. "It took us some time to realize that, unless the federal government moved in to play a role in solving this conflict, all our attempts to regulate it were pointless," Ivany said.
By October, they had succeeded. Kinross was able to hammer out a deal directly with the Finance Ministry to buy out its Russian shareholders and pay back the gold loan.
The deal needed Tsvetkov's guarantee. On Oct. 16, under pressure from the Finance Ministry, Tsvetkov agreed.
But then, two days later, Tsvetkov was killed.
"Tsvetkov was the prime participant in this deal," Ivany said. "It didn't help that he got killed. Other people in the administration have been reluctant to sign."
Now, four months later, Kinross is awaiting the finalization of the gold-loan deal. Since last Sunday's elections, progress has been made. This past week, Kinross bought out the 25 percent in Omolon owned by the new shareholders of Geometal Plus. It still has to complete the purchase of the remainder of shares, a 21-percent stake, from two bankrupt companies, Rossiisky Kredit bank and Magadan Gold and Silver.
TITLE: The View From the Bottom of the Sandwich
AUTHOR: By Christof Ruhl
TEXT: ALTHOUGH no-one seems to expect any major disruptions in Russia, 2003 has started with an unusually wide range of growth forecasts. And, accompanying these forecasts, there has been everything from exuberant optimism, particularly in the private sector (often voiced by foreign analysts), to gloomy predictions from semipublic think tanks.
Why this disconnect? The optimists, claiming a "feel for the place," point out that official statistics are notoriously bad at measuring private-sector activities, particularly among new small and medium-sized firms (SMEs) and in the service sector. Add to this a sizeable shadow economy, and the claim that Goskomstat doesn't capture the most dynamic parts of the economy is hard to refute.
Pessimists also claim a "feel for the place" and cite the figures to support their case. These figures show a decline in the growth of investment, the leading indicator of things to come. They further show that capacity utilization is leveling out, while costs - wages, domestic-energy prices and the real exchange rate - have all risen much faster than productivity. The conclusion is that the post-crisis recovery has run its course: Underutilized capacity translated ruble depreciation and high oil prices into high growth rates from 1998 on (and absorbed the whopping cost increases along the way). But, once capacity is fully utilized, growth depends on investment again - which has the skeptics worried.
The rift is deeper than one may think. Yegor Gaidar recently compared the current risks with the aftermath of Lenin's New Economic Policy and the unexpected, rapid economic recovery between 1923 and 1927. When this recovery ceased as unexpectedly as it had started, it led to the abandonment of any pretense of market mechanisms by the Bolsheviks. Others compare Russia - oil rich and complacent - to someone wandering outside and falling asleep in a snowdrift.
However, strolling down the main drag - and not only in Moscow - provides clear signs of an economic boom. Even official statistics register a shortage of skilled labor, explosive growth of lending to the private sector and increased investment inflows from abroad, much of it repatriated capital flight. Plus, there is an increasing number of large signature deals, with the recent BP deal merely the biggest example.
So, who is right? Enter the "sandwich" theory, according to which three segments of enterprises in Russia overlap with one another. Judgment of economic performance will be clouded by the segment at which one is looking.
On the top is a group of natural-resource exporters, around which the financial-industrial groups currently dominating Russia's economy are built. With current levels of oil, gas and other natural-resource prices, this segment is doing well. It has the highest productivity improvements of any segment. And perhaps the biggest difference from the pre-crisis period is that an increasing amount of cash generated by core exporters finds its way back into the Russian economy.
On the bottom is a layer of de novo enterprises, created and growing up under competitive conditions. It is this segment that drives economic growth in other post-communist economies but, in Russia, progress in this segment has been markedly slow. And the share of employment in new firms lags behind other transition economies.
In the middle, there is a large segment of old "Soviet" enterprises lacking technology, managerial skills and often simply the necessary cash flow. In Russia, for historical reasons, this segment is larger than in many Central European countries. It is in this middle segment that progress in economic development, or a lack thereof, is most visible. In part, the fate of this noncompetitive core depends on investment. For now, such investment can only come from the export earners or from investors abroad. Higher inflows have resulted in more mergers and acquisitions, and more successful turnarounds. Note, however, the risk that this mechanism will result in larger conglomerates further consolidating their stranglehold, generating problems for future growth.
But the problem companies should also be exposed to competition from new firms and, here, progress has been slow. While the natural-resource sector can compete internationally, attract investment and use offshore finance, the new SME sector suffers from red tape, lack of affordable finance and competition from large firms, which often enjoy the support of regional and local governments. While old enterprises may be unproductive, they tend to be key providers of jobs. And oligarchs, as a rule, are well-connected individuals. In the final analysis, both may have an interest in defending themselves against encroachment by new businesses, including by exerting influence on local bureaucrats.
Given this environment, it is welcome news that a recent survey conducted by the Center for Economic and Financial Research in collaboration with the World Bank shows improvements vis-a-vis the administrative burdens faced by small firms. The results square well with other survey evidence assembled by the World Bank and the EBRD. The CEFIR survey traces progress in the business environment by monitoring deregulation and liberalization. In particular, it tracks the implementation of a package of laws (introduced between August 2001 and January 2003) designed to simplify bureaucratic procedures and limit the scope for corruption.
The most important outcome of the recent survey is the message that reforms are starting to work for SMEs as well. Perceptions of the business environment have improved across the board, but progress has been significant in areas where new laws have had time to take effect and much less significant in those areas where debureaucratization laws came into effect only recently. This pattern points to the importance of targeted reforms. These reforms may be slow in coming and difficult to implement, but they have started to have an impact.
The survey also highlights a number of structural issues that are important for Russia's long-term development.
First, it confirms the privileged position of large enterprises. In locations where employment is highly concentrated, barriers to entry are higher and the administrative burden for those already "in business" is lower, indicating impediments to competition. It is not clear whether this applies more to old "dinosaurs" or new conglomerates, but preferential treatment in regions or municipalities with a high degree of industrial concentration is evident.
Second, deregulation has been more successful in regions with a larger share of small enterprises at the outset. Whether this is due to safety in numbers and the possibility of spreading the burden or an indication of the emergence of lobbying groups, the results do underline the importance of building a constituency for reform.
Third, the survey confirms the huge extent to which institutionalized corruption is still part of the system. Asked why they used the services of intermediaries or "consultants," generally with ties to the local administration, 20 percent of those who did responded that their applications for a license or certification would not have been considered otherwise.
So, clearly, not everything is rosy. In fact, in most areas, the business environment remains such that laws are being openly flouted: 77 percent of all licenses are valid for less than the five years prescribed by law; firms face multiple inspections in direct violation of the law; and fines are often not based on any official scale.
This gives an idea of how mixed the overall picture is. However, bad as the situation is, compared to the first survey conducted in spring 2002, small firms report an increase in fair competition as being the thing that changed most in making life difficult for them - not an increase in any of the numerous government regulations confronting them.
Russia's business environment remains difficult, especially if one is a small and new firm. But the deregulation package has genuinely started to have an impact, and demonstrates just how important it is to continue going further down this road.
Christof Ruhl, chief economist of the World Bank's Russia country department, contributed this comment to The St. Petersburg Times. The report is available at www.worldbank.org.ru and www.cefir.ru
TITLE: Weighing the Risk: The New Economics of War
AUTHOR: By Joseph E. Stiglitz
TEXT: A LITTLE more than half a century ago, World War II brought the United States and the world out of the Great Depression, earning for war a positive reputation - at least in the realm of economics.
At the time, some went so far as to suggest that capitalism needed war and that, without war, there would be an inevitable slide into recession.
Today, we know that both propositions are nonsense. The boom of the 1990s showed that peace is far better for the economy than war. And the Gulf War showed that wars can actually be bad for the economy. It is far more probable than not that a war in Iraq would be like the Gulf War.
World War II represented a total mobilization, beginning from a situation where there were vast amounts of idle resources. A war in Iraq, like the Gulf War, is likely to entail very limited resources, probably less than 1 percent of GDP.
Even without these expenditures, though, there are massive deficits, which will be even more massive if U.S. President George W. Bush has his way with his tax proposals. There is an increasing consensus - joined recently by U.S. Federal Reserve Chairperson Alan Greenspan - that the country can ill afford even more deficits, so any increased military spending will come at the expense of social expenditures and badly needed investments in research, infrastructure and education.
Accordingly, there is likely to be little if any short-term stimulus, while long-term growth will be hurt. Whatever one can say about whether spending money dropping bombs on Iraq enhances long-term national security, it does not do anything for long-term economic growth at home.
Of course, we cannot be precise about the economic effect of a war on Iraq because no one knows how such a war would play out or what its aftermath might look like. Of this we can be sure: The uncertainties we face as we seemingly move inevitably toward war are bad for the economy, coming as they do upon a host of other uncertainties.
The U.S. economy has not fared well over the last two years. Almost 2 million private sector jobs have been destroyed; a $3-trillion, 10-year non-Social Security surplus has been turned into a $2-trillion deficit and, if the president's proposals succeed, these deficits will balloon, with deficits as far as the eye can see, even when the economy returns to full employment.
Monetary policy has proved remarkably ineffective. The U.S. trade deficit has continued to grow. Corporate, accounting and financial scandals have rocked confidence in our business establishment, contributing to the plummeting stock market. Markets do not like uncertainty; they hold off on investment, waiting for it to be resolved. And, because the outcome of this particular military venture appears so uncertain, there is all the more reason to maintain a wait-and-see stance.
Consider the most favorable scenario: a short war with no repercussions outside Iraq. A new and democratic regime in Iraq might need to spend billions repairing the damage - not only from the war but from the decade-long sanctions - and it, probably, will have to depend largely on its own resources. As large new supplies of oil enter the market, the global price would become depressed, hurting the oil-producing parts of the U.S. as well as other oil exporters. In this scenario, the U.S. as a whole benefits, but parts of the country go into deep recession, similar to the devastation that befell the oil-producing states when oil prices dropped in the 1980s.
Then consider what most observers view as a more realistic scenario: The war lasts longer than anticipated, costs more than we thought and leads to some disturbances elsewhere in the oil-producing Islamic world; and there are some, if limited, terrorist attacks on the West. In this event, we need to recall the consequences of the Arab oil embargo of the early 1970s. And, this time, it could be far worse. Soaring oil prices can bring on global havoc and recession. In the course of the conflict, or in Iraqi President Saddam Hussein's waning days, the Iraqi oil fields may be left in flames. We may not like the task of nation-building, but could we, in good conscience, simply walk away?
We will be called upon to spend still more rebuilding Iraq than we spent removing Hussein from power. Some have suggested that one of the motivations for going to war is to seize control of these oil fields. But international scrutiny will be intense. Presumably, the international community will insist that there be competitive bidding for the right to develop these fields. U.S. firms may or may not win these bids, but even if they do, competition should limit their profits. And even if they manage to garner for themselves more than a normal rate of return, the broader benefit to the U.S. economy will be very limited.
Meanwhile, previous experiences have taught us that even limited terrorist attacks can have ruinous effects on the economy. Indeed, they are designed to deliver a big bang for the buck, to scare people. In the attempt to impede terrorism, flows of goods and services across borders will probably be held up; even financial flows may be impaired.
It is not a pretty picture. War seldom presents a pretty picture. But the United States is a rich country, able to withstand economic mismanagement and even a war that does not go as well as we might like. This war is unlikely to be good for the economy; it is more likely to be bad, possibly very bad. We will probably be poorer, and our growth slower than it otherwise would be.
No rational country goes to war to help its economy, but neither should any country wage war without weighing carefully the costs and benefits of going or not going to war, an analysis that brings in a consideration of all the relevant scenarios.
We should be thankful. At least we will not experience either the human carnage or material destruction that may well befall Iraq.
Joseph E. Stiglitz is the 2001 Nobel laureate in economics. He contributed this comment to the Los Angeles Times.
TITLE: Record Oil Deal Shows West Now Dancing to Russia's Tune
TEXT: AN ambitious deal in the Russian oil sector made the breaking news this month. British Petroleum, one of the world's energy majors, and a Russian oligarchic grouping - Alpha Group in cooperation with Access/Renova - announced their intention to merge their oil assets. The projected company, tentatively called NewCo, will be the third-largest oil company in Russia, after Lukoil and Yukos. The deal commits BP to invest $6.75 billion - half in cash and half in BP shares. This represents a record deal in relation to foreign investment, representing one quarter of total foreign direct investment in Russia since 1992.
Most observers are optimistic, noting that the deal reflects a growing confidence in Russian market. The reputation and courage expressed by BP will inspire other investors to come in and help realize the Russian goverment's old dream of fostering economic growth through foreign investment. British Petroleum, however, agreed to pay a remarkably high price, more than these assets would likely have brought on the Russian market. The company decided to buy the assets when world oil prices are high and not low. This seems to make little business sense, and some analysts suspect that the deal is politically motivated, representing an indirect payment for Russian cooperation in relation to the expected war in Iraq. These observations all seem reasonable, but the most important lesson is different.
British Petroleum has already had one unhappy experience doing business in Russia. In 1997, it invested in Sidanko but, in 1998, the latter was stripped of its most valuable assets, and BP lost about $200 million. BP struck back, using political connections in the United States to block credit to the Russian company that ended up with the assets in question. Ironically, this was Tyumen Oil Company (TNK) and its owner, Alfa Group - which has become BP's strategic partner in the new deal. Apparently, BP understood that there was nothing personal in what happened. The lesson that BP learned was simple: If you want to do business in Russia, you need to play by the Russian rules of the game. BP's investment and the creation of a joint venture means an impressive surrender by a major international company, and a signal of its readiness to play by Russian rules.
For the EU, this is a sign that the real situation may be unfolding in a diretction diametrically opposite to the one it had scripted.
The European Commission welcomes an increase in Russian oil and gas supplies to Europe. Officially, Brussels argues that increased EU-Russia trade in energy will make Russia compatible with European norms. The relationship developed in the oil and gas industry will be a positive example to spill over to other sectors. The BP experience reveals a reality contrary to these naive expectations. The European business has been forced to comply with Russian rules.
The Baltic Pipeline System is another example of the same trend. While offering funding, the EBRD tried to impose some conditions in defense of European interests, but they were rejected by the Russian side as unacceptable. The Kremlin then forced private Russian private companies to pay for the pipeline construction. Today, Moscow is exerting effective exerts pressure on Latvia to seize control over port facilities in Ventspils. The European Commission promised Riga that it would work on its side in negotiations with its Russian partners, but this assistance is unlikely to be any more effective than that offered by the hand of the EU hand in support of editorial freedom at NTV a couple of years ago.
The BP deal undermines a key assumption beyond the Western-sponsored policies of Russia reforms. Since the democratization agenda has been dropped, increased business interaction remains the only available instrument to affect the reforms in Russia in a way that would help make the country eventually compatible with the Western system. Interim results support an opposite thesis - either do business the Russian way or get out.
The stake on cooperation in energy is doubly misleading. It is not facilitating the democratic process as small and medium-sized businesses and the related middle class could do. Furthermore, it preserves the unhealthy asymmetries in Russian economics in favor of natural-resource exploitation and export dependence. In the view of liberal economists, this is one of the main obstacles impeding the Russian reform process. The rationale behind the BP deal might be easily understood, but it is in clear contradiction with the EU's declared strategy to see Russia become a liberal democracy and functioning market.
Igor Leshukov is the director of the Institute of International Affairs, St. Petersburg, a private think tank. He contributed this comment to the St. Petersburg Times.
TITLE: Global Eye
TEXT: Chemical Brothers
Six million marched for peace last week, but the Bush Regime and the Blair Regency were unmoved by this outburst from the ignorant rabble. Instead, the righteous leaders of the "Coalition of the Willing" (or COW) declared that no power on earth will halt their holy quest to rid the world of Saddam Hussein and his chemical weapons.
Strange, then, to see one of COW's biggest bovines - Pentagon warlord Donald "Squinty" Rumsfeld - informing the dazed and docile rubber stamps of congress of his intention to assault Iraq with, er, chemical weapons.
Rumsfeld told congress he has asked COW head George W. Bush to sign a special waiver allowing American forces to use biochemical weapons against Iraqi troops and civilians in the upcoming stampede into Iraq, UPI reported. What's more, the COW chemicals would be launched unilaterally, as part of the standard Rules of Engagement - and not merely in retaliation for an attack with similar weapons by Hussein.
In his extraordinary testimony - entirely ignored by the mainstream American media, of course - Rumsfeld openly complained about the onerous restrictions imposed on American forces by the stupid old Chemical Weapons Convention that the U.S. signed - indeed, initiated - many years ago. Rumsfeld told the Congressfolk of his deep "regret" that the U.S. had "tangled ourselves up so badly" with all that sissy-mary malarkey in the first place. But now, thank God, a real brush-clearin', pretzel-chompin' he-man is sitting on top of the COW, so Squinty is sure to get that waiver.
What Squinty wants to do is unleash a barrage of so-called "nonlethal" biochemical weapons against any godless Ayrab stupid enough to resist the incoming herd. This array of incapacitators - or to use the Pentagon's quaint term, "calmatives" - will include fighting pharmaceuticals developed by the world's leading drug companies. True, the weaponization of medicine is something of a departure from the Hippocratic Oath - but what's health and healing when your COW is calling you to war? Anyway, isn't the Hippocratic Oath - like the CWC, the ABM Treaty, the UN Charter, the Bill of Rights, indeed, the very notion of law itself - outmoded in the new Bush imperium?
Rumsfeld hopes to emulate the glorious success of Russian security forces, who used "nonlethal calmatives" to liberate the "Nord-Ost" hostages from their captors - and from the bonds of earthly existence as well. But there's one slight hitch: The Russians' employment of "calmatives" - however blundering and murderous - was legal under international law, which permits the use of "crowd-control devices" in domestic law enforcement situations. But the use of any chemical weapon against people in wartime - no matter how supposedly nonlethal it might be - is expressly forbidden by a number of international treaties, all signed by the United States.
Not only that: The very production of such combat weapons is prohibited - which is supposedly why COW is on its high horse about Iraq. Squinty knows this, of course; that's why he and COW head Bush have quietly shifted funding authority for "calmative" research from Pentagon coffers to John Ashcroft's Justice Department - it gives "domestic" cover to the military program. Meanwhile, Squinty proudly notes that production of "delivery systems" for the weaponized drugs is rolling right along: The COW invaders will be able to use both an unmanned "loitering vehicle" - which hovers in the air and sprays brain-deadening and gut-wrenching juice over all and sundry - and a good old-fashioned mortar shell loaded with chemical cocktails.
Rumsfeld painted the deployment of field chemical weapons as a "humanitarian gesture," but here, too, there's a slight hitch. "There is no way known to medical science that can put large numbers of people to sleep without killing a sizable percentage of them," Harvard biology professor and biochemical weapons expert Matt Meselson told The Nation. This is particularly disturbing in the light of Pentagon documents obtained by The Sunshine Project, a Texas-based group devoted to biochemical warfare issues, detailing the actual plans for the weapons.
The papers, produced by the Joint Non-Lethal Weapons Directorate, stress a concern for "target discrimination." Like so many Pentagon terms, this phrase actually means the opposite: The weapons do not discriminate among targets - civilian from soldier, for example - they simply knock out (or kill) everyone within range, allowing COW troops to move in afterward and discriminate the victims into piles of "bad guys" and unlucky innocent bystanders. This is considered particularly effective in urban warfare, although the JNLWD papers do note that "soldiers would probably have to be trained to refrain from killing persons already incapacitated with chemical weapons." Well, let's hope so, anyway.
Rumsfeld, of course, knows his way around drugs. He was chairman of two major pharmaceutical firms, including G.D. Searle, which later merged with Monsanto which then merged with Pharmacia & Upjohn and is now merged with Pfizer, creating one of the world's great conglomerations of medical loot. Doubtless, Squinty dumped any remaining shares in these various interlocking combines when he cashed out his $95 million worth of corporate holdings upon taking office in 2001 - or rather, many, many months after taking office and overseeing programs like, well, the weaponization of pharmaceuticals (before the program's hugger-mugger shift to Ashcroft).
He's also well-acquainted with the use of chemical weapons in combat. Back in 1983, when the United Nations first revealed that Saddam Hussein was exchanging biochemical unpleasantries with Iran, Rumsfeld himself was kicking back in Baghdad, bringing fraternal greetings to Hussein from the wise and pious leaders of the West: Ronald Reagan - and some guy named George Bush.
For annotational references, see the "Opinion" section at www.sptimesrussia.com
TITLE: Iraq, UN Hit Missile-Program Standoff
AUTHOR: By NIko Price
PUBLISHER: The Associated Press
TEXT: BAGHDAD - Iraq said it is "serious about solving" a UN order to start destroying its Al Samoud 2 missile program by the end of the week, but asked the United Nations to reconsider. A UN official in Baghdad said that wasn't an option.
Iraq's chief liaison to UN weapons inspectors insisted Sunday night that Baghdad is "clean" of weapons of mass destruction and suggested the United Nations and Iraq could come up with a compromise over an order to destroy the missiles, whose range has been tested at above the 150-kilometers limit imposed by the at the end of the 1991 Gulf War.
"The missile was and is still being researched and developed and hasn't reached its final stage. The weights are not final," Lieutenant General Hossam Mohamed Amin said. "We have suggested to [the inspectors] that they randomly choose any missile they want and check its range. We are sure its range will be less."
Amin said Iraq had sent a letter to chief weapons inspector Hans Blix last week proposing he reconsider. "We are still waiting for a response," he said.
But a UN official in Baghdad said Sunday night that the response had already come - in the form of Blix's order Friday to begin destroying the missiles by the end of this week.
"This is not negotiable," the official said on condition of anonymity.
UN Secretary General Kofi Annan said he expected Baghdad would go ahead with the destruction in the end.
"If they refused to destroy the weapons, the Security Council will have to make a decision," Annan said during a trip to Turkey. "I don't see why they would not destroy them."
Blix offered a harsher view, telling Time magazine in an interview to be published Monday that "of course they have no credibility" and "diplomacy may need to be backed up by force."
"Inspections may need to be backed up by pressure," he said.
The inspectors continued their inventory of Al Samoud 2 components on Monday, going to two factories that make the missile's guidance systems and engines. They also went to a chemical and explosives plant and an anti-aircraft missile maintenance facility, Iraq's Information Ministry said.
Blix expressed skepticism over Iraq's claims to have destroyed the stocks of anthrax and VX nerve agent. Blix told Time he found it "a bit odd" that Baghdad, with "one of the best-organized regimes in the Arab world," had no records of the substances' destruction.
"I don't see that they have acquired any credibility," he said. "There has to be solid evidence of everything, and if there is not evidence, or you can't find it, I simply say, 'Sorry, I don't find any evidence,' and I cannot guarantee or recommend any confidence."
But Amin repeated claims that Iraq is "clean" of weapons of mass destruction, and said Iraq is cooperating with the inspectors in an attempt to prove it.
An example, he said, can be seen in trenches Iraqi has begun to dig at sites where it says it unilaterally destroyed chemical and biological weapons. He said a UN team will come to Iraq on March 2 to check the soil for proof of the weapons' destruction.
Amin also cited as an example of Iraq's cooperation its agreement to let American U-2 spy planes fly over its territory to support the work of the inspectors. He said he expected French Mirage planes to begin flying over the next two days, and that Iraq was negotiating the use of German drones as well.
TITLE: Serbia's Seslj Surrenders To Hague Tribunal
AUTHOR: By Dusan Stojanovic
PUBLISHER: The Associated Press
TEXT: THE HAGUE, Netherlands - Serbian ultranationalist leader Vojislav Seselj surrendered to the UN war-crimes court on Monday to face charges that his paramilitary troops committed atrocities during wars in Croatia and Bosnia.
Seselj, a close ally of former President Slobodan Milosevic, took a commercial Yugoslav Airlines flight to Amsterdam, where he was detained by plainclothes police officers and driven off in an unmarked van.
His rights were read out to him at a gate of Amsterdam's Schiphol Airport before he was taken to the UN detention unit in a seaside suburb of The Hague.
Prosecution spokesperson Florence Hartmann said Seselj's decision to turn himself in was "a good one, and other indictees at large should follow his example."
Seselj, known for a fierce temper and scathing anti-Western remarks, said he was surrendering "in order to destroy the evil tribunal, an American instrument against the Serbs."
"I'll never give up the Greater Serbia goal," Seselj said. "I'm going to The Hague to defend the dignity of my 10,000 fighters who fought gallantly during the wars. They never committed any crimes and I'm going to prove it."
Thousands had gathered in downtown Belgrade on Sunday for a big farewell rally, when Seselj told a crowd of more than 10,000 supporters he was ready to face the tribunal.
Amid nationalist euphoria, with bearded men wearing traditional Serb caps and women crying openly, Seselj asked his followers to remain committed to Serb nationalist goals and not to allow the hand over of top suspects Bosnian Serb leader Radovan Karadzic and army commander Ratko Mladic.
"It is a huge challenge for me to go to The Hague and prove my people's innocence," he said. "The challenge was so big that I couldn't refuse such an opportunity."
The 48-year-old leader of the Serbian Radical Party, the biggest opposition group in the Serbian parliament, is accused of 14 crimes against humanity and violations of laws and customs of war between August 1991 and September 1993 in Croatia, Bosnia and the northern Serbian province of Vojvodina.
"I'll never give up the Greater Serbia goal," Seselj said.
Although he is not directly linked to any murders, his notorious paramilitary troops, known as "Chetniks," are alleged to have committed "violent extermination and expulsion" of non-Serbs from the regions of former Yugoslavia in order to create Greater Serbia.
It was not clear what prompted Seselj to deliver himself voluntarily while several other Serb war crimes suspects continue to evade the UN war-crime tribunal's justice.
Conspiracy theories in Serbia range from an unlikely deal he has made with The Hague court to nail Milosevic with his testimony and get a lenient sentence in return to rumors that he would flee before ever reaching the Netherlands.
The Bosnian-born Seselj has long stood out for his abrasiveness. When he rallied his supporters for an armed rebellion against Croatia's succession from Yugoslavia in 1992, he threatened to scoop out Croats' eyes with rusty spoons. He later claimed the remark was a joke.
TITLE: Plane Crash Kills Afghani Minister
AUTHOR: By Zarar Khan
PUBLISHER: The Associated Press
TEXT: KARACHI, Pakistan - A small plane crashed into the Arabian Sea off Pakistan's southern coast Monday, killing all eight people on board, including an Afghani government minister, officials said.
Wreckage from the Cessna 402, which crashed shortly after takeoff in clear weather, was found in the Arabian Sea. The aircraft was en route from Karachi's international airport to Jazak, near the Iranian border in southwestern Baluchistan. Six bodies have been recovered, said a naval spokesperson, Roshan Khayal.
An investigation into the crash is underway and, so far, there have been no reports of possible causes. Skies were clear at the time, airport officials said.
Among the eight dead was Afghani Mines and Industries Minister Juma Mohammed Mohammedi and Sun Changshen, the Pakistan representative of the China Metallurgical Construction Co.
"It is a tragic incident. The government of Pakistan has expressed sympathies with the government and the people of Afghanistan," said Aziz Ahmed Khan, Pakistan's foreign ministry spokesperson.
The aircraft, which was owned by Pakistan's largest private welfare organization, Edhi Trust, received its last air worthiness certificate in November 2002, according to Trust officials.
The aircraft had been chartered to take a delegation of Afghan officials to inspect a copper mine operated by the Chinese company near Jazak. In Kabul, officials said Mohammedi wanted to see the Chinese-operated mine to possibly adopt similar mining techniques at Afghan copper mines in Afghanistan's Logar province.
It crashed 45 miles west of the southern port city of Karachi, losing contact with the control tower 29 minutes into the 770-kilometer flight, said Pervez George, of the civil aviation authority that governs air traffic in Pakistan.
TITLE: Israeli Army Ends Gaza Raids
AUTHOR: By Ibrahim Barzak
PUBLISHER: The Associated Press
TEXT: GAZA CITY, Gaza Strip - Israeli troops withdrew from a Gaza Strip town early Monday, after demolishing five homes and two overpasses during a 30-hour raid aimed at stopping Palestinian rocket fire at a nearby Israeli town.
Also Monday, Israeli Prime Minister Ariel Sharon completed a narrow, right-leaning coalition that could make it difficult to relaunch peace talks with the Palestinians, or implement a U.S.-backed "road map" to Palestinian statehood by 2005.
The alliance, with a 61-seat majority in the 120-member parliament, consists of Sharon's right-wing Likud, the pro-settlement National Religious Party and the secularist Shinui faction.
The Israeli military stepped up its operations in Gaza 10 days ago, after a bomb blew up an Israeli tank, killing the four-person crew. Since then, 32 Palestinians and an Israeli soldier have been killed in Gaza, including six Palestinians shot dead by Israeli troops in fighting in Beit Hanoun on Sunday.
Beit Hanoun, in northern Gaza, borders on Israel. During the army raid, Hamas fired three more homemade Qassam rockets at the nearby Israeli town of Sderot, causing some panic, but no injuries. After withdrawing at daybreak Monday, soldiers deployed at the outskirts of Beit Hanoun, and armed Palestinians took up positions in the streets.
Palestinian militants have repeatedly fired Qassam rockets at Sderot, which is just down the road from Sharon's ranch. The unguided, simple Qassam rockets carry a warhead with about 5.5. kilograms of explosives and have a range of about 5 kilometers, according to the Israeli military. No Israelis have been killed by the rockets, although some have been lightly hurt.
The army said its soldiers destroyed two overpasses in Beit Hanoun overnight. The overpasses connected the town to Gaza City and were used by militants to launch Qassam rockets, the army said.
Israel has reoccupied every major West Bank Palestinian town and city, except for Jericho, since June. However, Israeli officials have said the army does not intend to seize areas in the Gaza Strip. Israeli operations in Gaza have largely been confined to air strikes and quick incursions.
Also Monday, Israeli troops destroyed four houses in the Khan Younis refugee camp and a three-story building that was under construction, Palestinian officials said. The army said the building was used by a Palestinian sniper who killed an Israeli soldier on Sunday.
In the West Bank, Israeli soldiers searching for a wanted man from the Al-Aqsa Martyrs Brigade, a militant group loosely linked to Palestinian President Yasser Arafat's Fatah faction, blew up the door to his house. The man's father, Mohammed Musseini, 50, was about to open the door when the explosion happened, and suffered a heart attack which killed him, relatives and hospital officials said.
On the political front, Sharon's Likud signed a coalition agreement with Shinui early Monday.
The National Religious Party, a small, hawkish faction that favors expanding Israeli settlements in the West Bank and Gaza Strip and opposes creation of a Palestinian state there, became Sharon's first partner on Sunday.
Despite his public pledge to renew peace talks with the Palestinians, Sharon is expected to be restrained by the NRP. Israeli media reported it was also likely that the National Union - a far-right faction that supports the expulsion of Palestinians - is also likely to join the government.
Sharon has until March 23 to present a majority coalition government to parliament for approval.
TITLE: Colombia Angry Over U.S. Troops
AUTHOR: By Vanessa Arrington
PUBLISHER: The Associated Press
TEXT: BOGOTA, Colombia - Colombian politicians on Sunday accused Washington of meddling in their country's affairs for sending more troops to search for three Americans held hostage by rebels.
Colombian member of congress Gustavo Petro warned against further U.S. involvement in Colombia's 38-year civil war. Some 260 U.S. special forces troops already are in Colombia training government troops to fight the rebels.
"Colombia is not Afghanistan, it is not Iraq," Petro told Radionet. "With the type of violent conflict we're living here, what the United States is going to get tangled up in is a new Vietnam."
The three Americans were aboard a U.S. government plane flying an intelligence mission when it crashed in rebel territory Feb. 13. Members of the leftist Revolutionary Armed Forces of Colombia, or FARC, have acknowledged they are holding the Americans hostage.
A fourth American and a Colombian army sergeant were shot and killed at the site.
TITLE: Kobe Extends Streak to 9, Matches Jordan
PUBLISHER: The Associated Press
TEXT: LOS ANGELES - Kobe Bryant reached 40 points for the ninth straight game - barely.
Bryant struggled at the end of the Los Angeles Lakers' 106-101 victory over Seattle on Sunday night, hitting two free throws with 0:23.6 left to put him over the benchmark with 41.
After making two free throws with 4:32 remaining, he missed six shots before his final two points.
While Bryant went cold, the visiting Sonics crept back into the game, with Rashard Lewis scoring four points in a 6-0 spurt that made it 101-96. Devean George then made a 3-pointer to put the game out of reach.
Bryant apologized to his teammates for his performance at the end of the game, and said he didn't regret what he did to reach the 40-point mark.
"I think 'regret' is not a fair word," Bryant said. "I took us out of the context of the offense. But I didn't exactly put the game in jeopardy. That's a difficult challenge to back down from."
"I was a little mad at myself," she said. "My teammates have been great through this whole thing. They understand."
The Lakers have won four straight, and 11 of 13, to move past Phoenix for seventh place in the Western Conference.
Bryant equaled the best streak of scoring at least 40 points by Michael Jordan, who did so early in the 1986-87 season.
The only player with longer streaks of 40 or more is Wilt Chamberlain. Chamberlain, the NBA's fourth-leading career scorer, accomplished the feat in 14 straight games twice in the 1961-1962 season and in 10 straight the following season.
Shaquille O'Neal added 27 points and 17 rebounds for the Lakers, and said he had no problem with Bryant's performance.
"It's all about winning games," O'Neal said. "When you win, nothing's a problem."
Bryant shot 13-of-34 including 1-of-6 from 3-point range and made 14 of 16 free throws in 42 minutes.
"Well, I wasn't sure if Kobe was going to chase that 40 points so bad that he was going to cut our chances out there at the end of the game," Lakers coach Phil Jackson said. "It got a little tenuous."
Ray Allen had a good game in his debut with the Sonics, just missing his second career triple-double with 26 points, a career-high 13 rebounds and nine assists. Allen and two others were acquired for Gary Payton and Desmond Mason on Thursday.
"I'm like a rookie all over again," Allen said. "I'm excited about this team. We didn't win the game, but we put some good basketball out there on the floor."
Dallas 106, Washington 101 (OT). In Washington, Dirk Nowitzki had 29 points and 10 rebounds, Michael Finley added 24 points, and Steve Nash had 22 points and 10 assists as the Mavericks won their sixth in a row.
Michael Jordan had 14 of his 30 points in the fourth quarter and overtime, two days after scoring 43 in a victory over New Jersey - when he became the first 40-year-old to score 40-plus.
The Mavericks rallied from an 18-point first-quarter deficit and blew a 12-point fourth-quarter lead as they improved to 20-4 against Eastern Conference teams.
Sacramento 99, New York 92. In Sacramento, California, Chris Webber had 20 points, 11 rebounds and nine assists after missing 10 games with a badly sprained left ankle.
Sidelined since Jan. 28, Webber barely missed his 18th career triple-double.Kurt Thomas scored 17 points for the Knicks.
Philadelphia 116, Cleveland 103. In Philadelphia, Allen Iverson scored 23 points and Derrick Coleman added 20 points and 13 rebounds as the 76ers won their sixth straight game.
Dajuan Wagner had 23 for Cleveland, which is an NBA-worst 10-46.
Orlando 113, New Jersey 105. In East Rutherford, New Jersey, Tracy McGrady had 46 points, 13 assists and 10 rebounds in the Magic's third straight win.
McGrady's performance came just two days after he had a career-best 52 points against Chicago. He hit 16 of 27 shots in posting the second triple-double of his career.
New Jersey's Jason Kidd had his third triple-double of the season and the 49th of his career with 26 points, 15 assists and 11 rebounds.
Minnesota 99, Phoenix 97. In Minneapolis, Wally Szczerbiak scored a season-high 30 points and Kevin Garnett added 24 points, 15 rebounds to help Minnesota win its franchise-best 14th straight at home.
Phoenix had a chance to win, but Casey Jacobsen's 3-point attempt with 4.9 seconds left went off the rim. Stephon Marbury had 32 points and 10 assists for Phoenix, which has lost three straight and five of six since the All-Star break.
Golden State 115, Atlanta 93. In Oakland, California, Jason Richardson scored 20 points, and Gilbert Arenas had 18 points and six assists as Golden State improved to 10-2 against the Eastern Conference at home.
Shareef Abdur-Rahim had 23 points and 14 rebounds for Atlanta, which lost for the sixth time in eight games.
TITLE: Henin Tops Seles, Takes Dubai Title
PUBLISHER: The Associated Press
TEXT: DUBAI, United Arab Emirates - Justine Henin-Hardenne recovered after dropping the first set to beat Monica Seles 4-6, 7-6 (7-4), 7-5 on Saturday to win the Dubai Open.
The top-seeded Henin-Hardenne was coming off a victory over Jennifer Capriati in the semifinals of the $585,000 tournament.
"It was unbelievably hard for me physically in the second set at match point," Henin-Hardenne said. "But, mentally, on the important points, I won."
Seles, seeded fourth, reached the final when defending champion Amelie Mauresmo quit during the second set Friday with a thigh injury. Against Henin-Hardenne, she could not sustain her momentum from the first set.
"I made more errors, and the second set was very emotional," she said.
Also Saturday, Martina Navratilova added another title to her career, winning the doubles with Svetlana Kuznetsova of Russia. They beat Cara Black of Zimbabwe and Elena Likhovtseva of Russia 6-3, 7-6 (9-7).
It was Navratilova's 168th doubles championship to go with her 167 singles titles - both tops in tennis for a man or woman. She and Kuznetsova also won a doubles event in Gold Coast, Australia, in January.
In Rotterdam, the Netherlands, Max Mirnyi beat Raemon Sluiter 7-6 (7-3), 6-4 in the final of the ABN Amro tournament Sunday for his first career title.
Sluiter had trouble handling Mirnyi's serves, clocked at 200 kilometers per hour. Both players held their serve through 12 games in the first set before Sluiter lost his twice in the tiebreaker.
In the second set, Mirnyi had the match's only break, winning at 2-2 after Sluiter hit two balls into the net. The pair held serve for the rest of the set, and Miryni clinched the win with his seventh ace.
TITLE: Nieuwendyk Hits 1,000 Mark
AUTHOR: By Ira Podell
PUBLISHER: The Associated Press
TEXT: PHOENIX, Arizona - Jarome Iginla scored four goals, but couldn't quite match Joe Nieuwendyk, for whom he was traded when he was sent to the Calgary Flames from Dallas.
Iginla had four goals Sunday night in Calgary's 4-2 victory in Phoenix, and did it the same day Nieuwendyk reached 1,000 NHL points in New Jersey's 4-3 win at Pittsburgh.
Nieuwendyk, traded to Dallas in December 1995, had the best game ever against the Coyotes franchise when he scored five goals for the Flames against Winnipeg in 1989.
Iginla scored on a power play, short-handed, at even strength and into an empty net as he matched his career high for points with his first four-goal game. The only thing he didn't do was score a goal on a penalty shot.
"I don't know if that ever happened," coach Darryl Sutter said. "That's what we pay him all that money for."
Only Mario Lemieux scored five ways in a game when he did it against New Jersey in 1988.
The money that Sutter was speaking of might make Iginla a former Flames player by next month's trade deadline. He is earning $5.5 million this season and his salary will increase next season.
Iginla, who led the NHL in goals and points last season, has 13 of his 28 goals in February. The hat trick was his second in nine games.
"I thought with about a third of the season left coming into this month there was a lot of hockey left, and the first two-thirds hadn't gone very well," Iginla said.
Nieuwendyk scored midway through the third period for his 1,000th point, and Scott Gomez put New Jersey ahead 37 seconds later as the Devils came back to beat Pittsburgh.
Nieuwendyk is the 65th NHL player to reach the mark.
"I've kept getting chances, and some of them have gone into the net," he said.
New Jersey overcame deficits of 1-0 and 3-2 while rallying to win in the third period for the second straight game.
The Devils have won five of the 19 games they've trailed entering the third period and are 9-12-0-4 when an opponent scores first.
"We're probably pushing our luck a little bit," goalie Martin Brodeur said.
"I don't think we want to do this all the time. But, right now, it's working," he said.
Boston 4, N.Y. Islanders 4. In Uniondale, New York, Don Sweeney scored his second goal of the season with 2:24 left in regulation time to lift Boston into a tie.
Boston, which finished a road trip 1-4-2, also got goals from Glen Murray and Jozef Stumpel, and a goal and three assists from Brian Rolston.
Anaheim 4, Carolina 0. In Raleigh, North Carolina, Sandis Ozolinsh had a goal and an assist, and Martin Gerber stopped 28 shots for his first career shutout.
(For other results, see Scorecard.)