SOURCE: The St. Petersburg Times
DATE: Issue #915 (83), Friday, October 31, 2003
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TITLE: Yukos Shares Frozen As Stakes Raised in Kremlin's War
AUTHOR: By Catherine Belton, Valeria Korchagina, and Alex Nicholson
PUBLISHER: Staff Writer
TEXT: MOSCOW - Prosecutors dropped a bombshell on the market Thursday, freezing some $15 billion worth of shares in Yukos and Sibneft as they took the Kremlin's war against jailed tycoon Mikhail Khodorkovsky into uncharted territory.
Prosecutors said they seized 44 percent of Yukos, which now owns 92 percent of Sibneft, to stop Khodorkovsky from selling his controlling stake in the company.
The unprecedented move by prosecutors came just an hour before President Vladimir Putin was scheduled to meet with top executives of leading Russian and foreign investment banks, including, CitiGroup, Morgan Stanley, ABN Amro, Renaissance Capital and United Financial Group.
Details were sketchy, but participants said the meeting was called by the Federal Securities Commission, in part in an effort to calm investor fears that the assault on Yukos presaged a wider redistribution of property.
"Putin tried to make a real point that [taking control over shares] is not what this is about. He sad the shares were being seized to cover what the liabilty is, not to confiscate," sad UFG CEO Charles Ryan.
"He did appear to be conflicted over short- and long-term strategies. He realized that in the short term there could be a negative effect but he thought that could be outweighed in the long term by imposing the rule of law."
If Putin's goal was to calm the markets, it didn't work, as news that nearly half of the world's fourth-largest oil company had been sequestered sent shock waves through the global investment community, triggering a massive liquidation of Russian assets for the second time this week.
The shares, which lost 14 percent of their value on Thursday alone, were not seized, only frozen so they can't be sold, said Yury Kotler, spokesman for Menatep Group, the parent company of Yukos. Owners of the shares still have voting and dividend rights, he said.
Menatep condemned the Prosecutor General's Office for what it called another illegal action against the company.
"It means the state is capable of taking away anyone's property," Kotler said.
The prosecutor's office said in a statement that it had no choice but to hold the shares "as collateral against material damage" caused by Khodorkovsky and other founders of Menatep who are accused of cheating the state out of a total of about $1 billion.
Prosecutors denied that their next move would be renationalization.
"The shares have only been frozen, no one has seized them. There is no question of confiscating or nationalizing them," Natalya Vishnyakova, deputy head of the prosecutor office's press service, told Russian television.
The move stunned a business community already reeling from the arrest of Khodorkovsky, who was hauled out of a chartered plane at gunpoint in a pre-dawn raid of a Novosibirsk airport last Saturday.
Investors were further spooked Tuesday by reports that Kremlin chief of staff Alexander Voloshin had handed in his resignation amid a mounting struggle for power between rival Kremlin clans. Those reports were confirmed late Thursday. His replacement, the Kremlin said, is Dmitry Medvedev, Voloshin's deputy.
The secretive siloviki, made up of current and former secret service agents, appear to be pushing for the state to play a greater role in the economy, are pitted against the pro-business "Family" of people who came to power during former President Boris Yeltsin's term.
Analysts said the latest move by prosecutors was a clear sign that the siloviki have gained the upper hand in what could be a watershed event in the life of the country.
"This is going to take the level of fear to new heights," said William Browder, director of Hermitage Capital Management.
"The ultimate question now is what is going to happen to the shares," said James Fenkner, head of research at Troika Dialog. "Now that Khodorkovsky has been arrested, it is inconceivable that he can remain in control of Yukos."
"The worst-case scenario would be that the state takes over. The best case is that the state sells them on to a foreign oil major - there doesn't seem to be anything in between," Fenkner said, adding that if Khodorkovksy is convicted the state could confiscate his property.
Analysts said the prosecutors' move appeared to be aimed at preventing the sale of a strategic stake in YukosSibneft to a Western oil giant. ExxonMobil and ChevronTexaco have both been eyeing a stake in the newly merged Russian company in what, for Khodorkovsky, would have been one of the most profitable deals in world history.
Khodorkovsky bought Yukos in a dubious auction in 1995 for almost $300 million. At one point, prior to its tie-up with Sibneft and the launch of the legal assault against it, the market considered Yukos to be worth more than $30 billion.
But the siloviki appear determined to deprive Khodorkovsky of such a staggering windfall.
"When Russia began privatizing property it was done with the understanding that privately owned property would be more effective than state-owned property. We did not privatize so that the property could be sold to the United States and Khodorkovsky would get the money," said Sergei Markov, a political analyst close to the Kremlin.
Boris Nemtsov, the co-leader of the Union of Right Forces, a right-wing parliamentary faction funded by Yukos, said Thursday's move destroyed any hope that Putin's goal of doubling the size of the economy within a decade would be achieved.
"With the way the Kremlin and prosecutors are behaving, one can forget about it," Nemtsov said by phone.
"This will result in capital flight. The country's reputation will suffer tremendously. Investment- both domestic and foreign - is going to plummet, so will budget revenues. There will be a slowdown in economic growth," he said.
"Russia rarely gets lucky, but we had a chance. Now we are losing this chance," Nemtsov said.
Markov, however, disagreed that a takeover of Yukos would harm the economy.
"All we are talking about is a change in the company's ownership structure, and a change of management towards those who are not considered by [the siloviki] to be dangerous," he said.
"The trend now is to strengthen the state, and they do it how they can."
Menatep's Kotler, however, said prosecutors would not be able to seize Yukos, and that in arresting the shares they were breaking the law.
"Prosecutors do have the right to arrest Khodorkovsky's property while he is in detention," Kotler said.
"But unfortunately Khodorkovsky owns only 9.5 percent of Yukos. The shares they arrested have no relation to him."
Kotler said the shares seized were owned by Yukos Universal and Halley Enterprises, both foreign-registered entities that belong to Menatep Gibraltar, a daughter company of Menatep Group.
Khodorkovsky reportedly owns 59.5 percent of Menatep Group, the main ownership vehicle for Yukos. But Kotler said Thursday that Khodorkovsky owned only 9.5 percent of Yukos and his stake in Menatep was less than 10 percent.
He said the shares seized by prosecutors were neither owned by Khodorkovsky, no his relatives, or structures affiliated to Khodorkovsky. He said those shares had been placed in trust for Khodorkovsky to manage.
Despite touting Yukos as Russia's most transparent company, he said he could not disclose who owned the shares, apart from saying they included foreign individuals.
He said these owners would soon begin to sue the Russian government for arresting the shares.
"This is not the end of Yukos," said Sam Barden, head of equity sales at Menatep-owned Trust investment bank. "It is the start of an international battle."
TITLE: Law Lets Smolny Tap Team
AUTHOR: By Vladimir Kovalev
PUBLISHER: Staff Writer
TEXT: A new law on the structure of the St. Petersburg city government was passed by the Legislative Assembly in a third and final reading Thursday, with 44 lawmakers voting in favor and two abstentions.
Three-and-a-half weeks since Valentina Matviyenko was elected governor, she is now able to form her government on a legal basis that, some politicians say, means the Legislative Assembly has surrended its right to oversee who runs City Hall.
"She can send her list of candidates [to the Legislative Assembly] today so that the candidates can meet with the factions and answer deputies' questions," Interfax quoted Viktor Lobko, head of City Hall management office, as saying Thursday. "But the Legislative Assembly can confirm them only after the law has taken effect."
The law will come into force 10 days after it is published, which means the earliest confirmation date is Nov. 12, Lobko said.
Wednesday, the Legislative Assembly made 82 amendments to the law before passing it in the second reading.
"The law is good in that it has finally determined the number of vice governors and specified their responsibilities," said Boris Vishnevsky, member the Legislative Assembly Yabloko faction, in a telephone interview Thursday.
"And it is bad because more than half of the government will be unknown people appointed by the governor without consulting the assembly," he added.
According to the new version of the law, all vice governors must be confirmed by the assembly, but the heads of City Hall's 26 committees are not required to be confirmed.
Under the new structure, there will be several committees under each vice governor, but the heads of some committees will not be answerable to the assembly or to the governor.
Previously, 14 vice governors, each responsible for a particular committee, had to be confirmed by the assembly, but the new law says the governor appoints the heads of committees.
The eight vice governors to be officially appointed mid-November will each be responsible for several committees.
Also, heads of the local police and tax inspectorate - two federal bodies - are also members of the city government.
"This is another bad thing, that representatives of two federal structures are included in city government," Vishnevsky said.
"That violates the principle of separation of power. I don't think anybody would have dreamed of making a Moscow mayor or St. Petersburg governor an active member of the federal government."
Vladimir Yeryomenko, a Mariinskaya faction lawmaker, said he failed to push through one key amendment that would have allowed the Legislative Assembly to control the city government by having the ability to hold votes of no confidence in vice governors who do not perform.
Yeryomenko's amendment would have resulted in incompetent vice governors losing their jobs if the Legislative Assembly passed two votes of no confidence in them within six months.
"The heads of the city government want to get rid of deputies' control and untie their hands when appointing staff," Yeryomenko said Wednesday in a telephone interview. "They prefer to operate under less scrutiny. They want to be the only ones with their hands on the steering wheel."
For now no-confidence votes are still possible, but only under rules written in the City Charter, which say a vice governor can only be fired after second no-confidence vote passes within a year.
"This was done so that incompetence would be forgotten over a long period of time," Yeryomenko said.
But Vatanyar Yagya, a lawmaker in Party of Life faction, said it is good that the new law gives Matviyenko an opportunity to form half of the government without consulting the Legislative Assembly.
"I wouldn't say there's going to be less control," Yagya said Wednesday in a telephone interview. "The [City] Audit Chamber is still going to monitor how each committee spends budget money.
"And even before, the governor could appoint the heads of city districts without asking lawmakers, so I don't see anything bad about it.
"I am happy to see that the new governor chose to cooperate and not to destroy the Legislative Assembly right after she was elected," he said, refering to former governor Vladimir Yakovlev's constant battles with the assembly.
According to the law, the city government will have at least seven vice governors. Most of their names are known in local political circles.
"Journalists are very good in their predictions [on city government staff]; they are almost authentic," said Lobko, the City Hall representative.
TITLE: Court Rules Media Limits Are Unconstitutional
AUTHOR: By Caroline McGregor
PUBLISHER: Staff Writer
TEXT: MOSCOW - The Constitutional Court on Thursday ruled as unconstitutional one part of the law that restricts media coverage of election campaigns, and in doing so, gave journalists more room to do their jobs, opponents of the law said.
The ruling, read by Chief Justice Valery Zorkin, cancels an umbrella clause in the law on guarantees of voters' rights, which defined campaigning so broadly that reporting information on a candidate could be construed as a violation if it was capable of swaying voters.
Previously, any detail characterizing a politician could be seen as helping or hurting a politician's image.
Kaliningrad journalist Konstantin Rozhkov said his newspaper was fined 2,000 rubles ($67) and ultimately closed by the authorities for having called a general a general, an artist an artist and the son of a murdered deputy, the son of a murdered deputy. "That was the law," he said in an NTV interview.
But that is no longer true.
Too much of what is simply information could be seen as campaign material, Zorkin told reporters after the decision. Now, only those media reports that are expressly designed to affect voters' choices should be taken as inappropriate.
The seventh sub-clause, "zh," of article 42, clause 2, defines as pre-election campaigning "any action, inducing or trying to induce voters to vote for candidates, lists of candidates, or against [them]."
This is "incompatible with judicial equality, limits the freedom of public information and the rights of citizens to receive information they vote as they wish in the elections," the court wrote.
State Duma deputies and journalists petitioned the court to overturn a series of clauses in the voters' rights law in September, arguing that the legislation was limiting their ability to fulfill their professional duties. The voters' rights law was passed in June 2002, but only came under scrutiny as the election season neared. Amendments to the media law were passed this summer, also restricting the campaign season playing field.
Apprehension over how courts could interpret the legislation led many journalists to shy away from political coverage and politicians to complain of an information vacuum barring them from getting their message out.
The six sub-clauses previous to the one canceled give specific definitions of campaigning, and they stay on the books.
Andrei Richter, the director of the Moscow Media Law and Policy Center, said, "At least [now] it's a closed list. It was an open list until today. By deleting the blanket term, they made the list a bit clearer."
The overturned clause gave the Central Elections Commission and judges too much room for subjective interpretation when deciding whether a journalist's reporting was appropriate or not, he added.
Alexander Veshnyakov, chairman of the Commission, which monitors press coverage of the campaigns, reminded the press Thursday that election season events must be reported as fact, separate from any commentary, and with equal focus on all candidates and parties.
If a media outlet is found to be in violation, after initial fines and warnings, the Commission can turn to the Press Ministry to take the case to court.
Alexei Simonov of the Glasnost Foundation said he, too, was pleased with the decision, but the damage had already been done. "The mechanism of fear and pressure on journalists has already been let loose. So on the surface, it changes things, but in reality, it doesn't."
But Ekho Moskvy's Alexei Venediktov said, "We got what we wanted." That, he said, was the right to express opinion, as long as it was not designed specifically to influence voters on behalf of one party or another.
Commentary is acceptable if it is not blurred with factual reports, or if it is packaged separately from "information blocks," Zorkin said.
Also by law, every candidate and party has the right to equal coverage. For example, if three parties hold an event on the same day, a publication must cover all three, or none. Asked how to divide a one-minute round-up of top news among a dozen candidates, Zorkin warned against taking a general principle "to an absurd degree."
Konstantin Katanyan, a commentator for Vremya MN, whose appeal was one of the four considered, said the court "had explained to all ... not so conscientious bureaucrats that there's no point in getting a pencil to count the number of letters written about one or another candidate."
Representatives of the Union of Right Forces, Yabloko and the Communist Party, which initiated the appeal to the court, said they were pleased with the decision Thursday. United Russia politicians were criticized for refusing to support the appeal against restrictions, which are seen as beneficial to them.
The decision went into effect Thursday. A spokeswoman for the court said the decision would be published in Rossiiskaya Gazeta within two weeks.
In many ways, the true test of how the law will influence campaigning will come only after Nov. 7, when the campaign season officially begins one month before State Duma elections.
Meanwhile, Rozhkov, the Kaliningrad journalist, said he planned to appeal to the European Court in hopes of winning even broader reporting freedom.
TITLE: Friend: Putin Saw U.S.S.R in Decline
AUTHOR: By Robin Munro
PUBLISHER: Staff Writer
TEXT: President Vladimir Putin once joined his colleagues to drink to the early death of Soviet leader Konstantin Chernenko and believed that the Soviet Union was doomed, according to a new book written by one of his former colleagues.
A report on the book, due to be printed in Russia soon and called "Sosluzhivets," was printed in German magazine Der Spiegel last week.
The book's author is Vladimir Usoltsev, now 56, who sat at the desk opposite Putin - known then as "little Volodya" - during the future president's posting to the German city of Dresden from 1984 to 1990. Both men held the rank of major.
The report describes how the officers drank champagne after Chernenko's death in 1985 because he died after a short time in office rather than having had a lingering illness like the ones that killed his two predecessors Yury Andropov and Leonid Brezhnev.
"We were the young generation of the security service. It was absolutely clear to us that Soviet power was marching inexorably into the abyss," Der Spiegel quotes Usoltsev as saying.
According to the report, Dresden offered little excitement and the salaries of the KGB officers stationed in Eastern Germany were miserable. Prestige and good wages belonged to those who operated in West Germany.
The lives of the handful of KGB officers stationed in Dresden are described as taking place in "a small world," as if they were on a spaceship on a long-term flight - "a microcosm in which recent graduates of the secret service school met with dogged old Chekists. A world full of stupid work with files, instructive party circles and human intrigues."
Usoltsev portrays Putin as a pragmatist, "someone who thinks one thing and says another," and describes him as a conformist. He did not stand out.
Putin's job was to seek potential KGB agents among the foreign students at Dresden's Technical University, with whom he met in his car or on the moors around Dresden. Putin treated Rainer M., an East German policeman whose duty was to cooperate with the KGB in these actions, "almost as if he were a family member," the report quotes Usoltsev as saying.
The future president hid his ambition and tough treatment of others under an image of politeness and obedience that served him well with his various bosses and later with President Boris Yeltsin in the Kremlin, Usoltsev is reported as saying.
Putin presented himself as a convinced Communist who had no wish for changes in the Soviet Union and criticized a colleague who called for them, saying he'd better keep his complaints to himself and think of his family.
But when they were in the sauna, Putin surprised Ulsolsev with his political opinions.
Putin showed an interest in civil rights activist Andrei Sakharov. However, Putin did not want to admit that under Stalin secret service officers had shot people without regard to their guilt or innocence, but purely to fulfill a quota set by Moscow, the report says.
Usoltsev said Putin's tolerance for Jews was unusual in the KGB, which was deeply anti-Semitic and saw everything that they considered anti-Soviet as having Jews behind it.
For Putin, Jews were ordinary people; he had grown up among them in the sport clubs of Leningrad where many trainers and top athletes were Jewish, the report says.
Usoltsev describes Putin's German as "fluent, but basic," and ranked his intellectual abilities as "good, but nothing special; he was not a great speaker." Putin's greatest achievement in Dresden was to rescue the list of all KGB contacts from the local East German security police (Stasi) office just before the fall of the Berlin Wall in 1989.
Usoltsev was amazed, as were other Dresden colleagues, to hear that Putin had ended up holding high political office, even though Putin was ambitious.
He was also surprised when, after the collapse of the Soviet Union, Putin turned up as the right-hand man to St. Petersburg Mayor Anatoly Sobchak. Putin began a political career after quitting the KGB to become a taxi driver.
Usoltsev considers that he was working for Sobchak as a KGB officer on a special mission.
Now in the Kremlin, Putin is still dependent on the secret services.
"That for me is the greatest puzzle," Usoltsev is quoted as saying. "That's his tragedy.
TITLE: Liberal Deputy Refused Registration
AUTHOR: By Vladimir Kovalev
PUBLISHER: Staff Writer
TEXT: The election commission for electoral district No. 206 has refused to register prominent St. Petersburg State Duma deputy Yuly Rybakov as a candidate for December's Duma elections.
The election commission said Rybakov violated federal election law by publishing a report on his activities in the Duma, as the report was not paid for with money from his election fund.
"We submitted a report to the city election commission where it was clearly stated that the report was paid for out of my election fund," Rybakov said late Thursday in a telephone interview. "The city election commission ruled that everything was done according to the law, but the district commission lied and members of the commission who don't understand financial matters well were confused.
"This is, of course, a political order and there are no different motivations," said Rybakov, who was imprisoned for his political activities in Soviet times and is supported by, but is not a member of, the Yabloko party. "Members of the district commission have openly called me an enemy after [State Duma Yabloko lawmaker] Alexander Shishlov withdrew his candidacy in my favor.
"They've been openly saying that since I am the only democratic candidate left in the district they have to get rid of me," he said.
The election commission could not be reached for comment Thursday.
The decision made by the district election commission is based on a claim filed this month by Sergei Andreyev, a member of the Unity faction in the Legislative Assembly.
"This is, in fact, a frank betrothal between members of the election commission and a KGB-oriented power group that wouldn't want to see self-motivated and independent legislators in the Duma," Ruslan Linkov, leader of local Democratic Russia party, said Thursday in a telephone interview. "They will do anything to ensure that Rybakov is excluded from the elections.".
In March 2002, Rybakov tried to bring to St. Petersburg 100 copies of a film financed by Boris Berozovsky about the alleged involvement of the Federal Security Service in apartment blasts that killed some 300 civilians and suspicious activities in Ryazan in 1999.
All copies of the film were confiscated.
Linkov said Vladimir Yudin, another candidate in electoral district No. 206 and a People's Party Duma deputy, initiated the probe of Yukos head Mikhail Khodorkovsky in June. Yudin asked the General Prosecutor's Office to examine the legitimacy of the fertilizer plant Apatit privatization deal.
Platon Lebedev, one of the Yukos shareholders, was arrested July 2 and put in jail on charges that he embezzled 20 percent of Apatit shares.
Yudin could not be reached for comment Thursday.
Rybakov said he will appeal to the Central Election Commission on Friday.
TITLE: Could Khodorkovsky Run for President?
AUTHOR: By Catherine Belton
PUBLISHER: Staff Writer
TEXT: MOSCOW - As President Vladimir Putin accepted the resignation of his chief of staff Alexander Voloshinon late Thursday, a new political figure was emergeing from the wings in a reminder that strange intrigues never end in Russian politics.
That figure is jailed Yukos CEO Mikhail Khodorkovsky. And, politicians and analysts suggested, he could be used as a third opposition force in the presidential elections to force Putin into a second round and into compromise with big business.
The yakking started with a report in liberal daily Gazeta saying that the Communist Party had held an emergency meeting over the weekend to discuss forwarding Khodorkovsky as its candidate for the presidential elections. The party was quick to issue a denial, but by the afternoon, the idea that Khodorkovsky could run had stuck.
Ekho Moskvy radio conducted a poll to see who listeners would vote for if confronted with a choice between Khodorkovsky and Putin. Khodorkovsky won by a long margin among the station's liberal audience. He gained 87 percent of votes cast by Internet and 75 percent of votes called in.
Politicians and analysts polled by The St. Petersburg Times said there was a chance Khodorkovsky could try to run in opposition to Putin in the 2004 presidential elections.
"Khodorkovsky will be forced to run in the presidential campaign," said Ilya Ponomaryov, the Communist Party's chief information officer, who worked for Yukos from 1998 to 2002. "Once he has registered as a candidate, he will be set free. He will gain immunity before the law.
"The whole attack has been aimed at taking him out of business and at making him a political figure. The Gazeta article was a red herring, but it was done to underline his move into politics. The Russian population loves anyone who has been oppressed."
Irina Khakamada, a leader of the Union of Right Forces, or SPS, agreed that Khodorkovsky's jailing was turning the once reviled oil magnate into a political figure. "The longer he sits in jail, the more of a political figure he will become. Russians love martyrs. They will forget that he is an oligarch," she said in a telephone interview.
Underlining a possible growing source of sympathy for Khodorkovsky among the liberal elite, the Moscow press has been filled this week with articles that decried the arrest early Saturday as a sign a totalitarian coup had taken place in Russia. Most dailies from red to white declared victory for a sinister group of Kremlin hawks, known as the siloviki, that were out to squash democracy and take over power from the pro-business Kremlin wing known as the Family led by Voloshin.
Even the deputy chairman of the Communist Party, Ivan Melnikov, said he could find common ground with Khodorkovsky as a fellow defender of democracy. "We could have common interests," he said in a telephone interview. "We support a democratic path of development for Russia, and we support any person that is pushing democracy.
"The current regime is becoming more and more totalitarian. We have no division of powers anymore. All of the institutes of power are controlled by the Kremlin," he said.
But he denied that the Communist Party could in the end back Khodorkovsky as a presidential candidate. "This would be impossible for the KPRF. We have principles that are significantly different from Khodorkovsky's.
"Defending democracy is not the only issue here," Melnikov said.
Ponomaryov also said it was unlikely the Communists would back Khodorkovsky, but he said SPS or Yabloko could field him. He also said it was possible he could run as an independent.
Khodorkovsky has openly said he is funding Yabloko and SPS ahead of December's parliamentary elections. Analysts have said one of the reasons the Kremlin went after Khodorkovsky was because they suspected him of trying to lock in his own loyal faction in the Duma. Another major Yukos shareholder, Sergei Muravlenko, is reported to be funding the Communists.
Some analysts said Khodorkovsky's arrest could galvanize SPS, Yabloko and the Communists to unite and form an opposition movement to Putin.
"If the country is threatened with the possibility of turning into a police state, then SPS, Yabloko and the Communists could well join around one opposition candidate," said Andrei Piontkovsky, an independent political analyst.
A year ago, oligarch-in-exile Boris Berezovsky called for those three parties to unite and form an opposition movement to fight Putin in the parliamentary elections. He did not appear to get much response.
But now that Khodorkovsky is behind bars and the other business leaders are in uproar, wondering if they could be next, Berezovsky once again is pushing the art of the possible.
"SPS and Yabloko will have to join around Khodorkovsky for the 2004 elections," Berezovsky said Wednesday from London.
"They have to act now because after that there will be no other chance. If Putin is not stopped in 2004, then there will be a totalitarian regime," he added.
Khodorkovsky's first hearing has been set for Dec. 30. Registration for presidential candidates opens Dec. 14. "They won't be able to convict him in time," he said.
A check of election law found on the Central Elections Commission's web site appeared to indicate people in detention can run.
A spokesman for the commission could not confirm this.
TITLE: Perle: Exclude Russia From G-8 After Tycoon Arrest
AUTHOR: By Simon Saradzhyan
PUBLISHER: Staff Writer
TEXT: MOSCOW - Richard Perle, a hawkish policy adviser whose voice is heard in the Pentagon, has called for Russia to be expelled from the Group of Eight industrialized countries over the arrest of Yukos CEO Mikhail Khodorkovsky.
"Russia should be excluded from the G-8. No [other] G-8 country is allowed to treat its leading businessmen the way Russia treated Khodorkovsky," Perle was quoted as saying in Russian translation in the Thursday issue of Kommersant. "I believe Russia is moving fast in the wrong direction."
Perle, who believes that the White House should contain the Kremlin rather than cooperate with it, has criticized the campaign against Yukos shareholders from the beginning.
Although he resigned as chairman of the Pentagon's Defense Policy Board, Perle retains strong influence on Defense Secretary Donald Rumsfeld.
The influence of this camp on President George W. Bush has waned somewhat, but it is still strong when it comes to shaping U.S. defense policy, according to Alexander Pikayev, a military specialist at the Carnegie Moscow Center. The conservatives, however, can do little to influence Washington's relations with Russia, according to both Pikayev and Ivan Safranchuk, Moscow representative of the Washington-based Center for Defense Information.
Nevertheless, Perle's appeal could set off new criticism of President Vladimir Putin's policies, they said.
Perle may be using the Yukos affair to push his vision that the U.S. should contain Russia rather than treat it as a strategic partner, Safranchuk said.
TITLE: IN BRIEF
TEXT: FBI Dubrovka Probe
MOSCOW (SPT) - The FBI is conducting its own investigation into the October 2002 Dubrovka hostage crisis to determine the cause of death of a U.S. citizen, Sandy Booker of Oklahoma City, Oklahoma, who was among the hostages.
A U.S. Embassy official, who asked not to be named, said the investigation is being conducted by the FBI together with the Prosecutor General's Office, the Federal Security Service and the Interior Ministry. Booker's fiancee, Svetlana Gubareva of Kazakhstan, will fly to the United States in early November to testify to the FBI, Moscow lawyer Igor Trunov told Interfax.
Journalist Killed
MOSCOW (SPT) - A journalist on Provincial Telegraph, a newspaper in the Saratov region, was killed in the city of Balakovo, Interfax reported Thursday.
Yury Bugrov was found beaten to death early Thursday morning, the local police chief, Constantine Seleznyov, was reported as saying. A criminal investigation has been launched.
Bugrov was head of the city's administration prior to 1994, Interfax reported.
Candidate Checks
MOSCOW (SPT) - At the request of the Central Elections Commission, the Interior Ministry has announced plans to run background checks on individual candidates, as well as parties, running in the Dec. 7 State Duma elections.
"In the pre-electoral period a fundamental problem in the cause of protecting rights ... is not to allow the penetration of criminality into power, and to provide strict enforcement of electoral legislation," Deputy Interior Minister Alexander Chekalin was reported as saying by Interfax.
Chekalin said the checks would investigate candidates' criminal records, and verify their registration information, including the candidate's place of residence and citizenship.
Ivanov in Kiev Talks
KIEV, Ukraine (AP) - Russian Foreign Minister Igor Ivanov reiterated his country's respect for Ukraine's territorial sovereignty Thursday at a start of a visit to smooth over a dispute over a small island that controls access to resource-rich waters.
"Russia has always respected and respects Ukraine's territorial integrity," Ivanov said before a one-on-one meeting with his Ukrainian counterpart Kostyantyn Gryshchenko in Kiev.
He stressed the need to resolve a number of issues the two countries inherited after the Soviet Union collapsed, including the delimitation of a water border between the states, which he said had been "dragged out without reason."
From his part, Gryshchenko urged Ivanov to "relieve the tension," which he said came unexpectedly for Ukraine.
Putin to Visit Pope
ROME (AP) - Italy confirmed Wednesday that President Vladimir Putin would visit the country Nov. 5 - a state visit that includes a European Union-Russia summit, a meeting with Pope John Paul II and bilateral talks.
It will be Putin's second trip to Italy this year: He spent three days at Premier Silvio Berlusconi's Sardinian estate in August.
Moscow has said it wants the Nov. 6 EU summit in Rome to focus on its push for visa-free travel between Russia and the EU as well as Russia's efforts to join the World Trade Organization. Berlusconi has also said he and Putin were working to ease tensions between the Vatican and the Russian Orthodox Church, and suggested a meeting between Putin and the pope could help.
Starovoita Prize Given
ST. PETERSBURG (SPT) - Prominent critic of Communism Valeria Novodvorskaya has won this year's Galina Starovoitova Prize, which is given for contributions to civil rights and the strengthening of democracy in Russia, Interfax reported Thursday.
"It is no accident that we award the prize on this day, when the country commemorates a sad anniversary - the Day of Remembrance for the victims of political repression," the agency quoted the head of the St. Petersburg branch of Democratic Russia. Starovoitova, the former head of the party, created the prize in 1998, the same year she was assasinated.
Novodvorskaya is to receive $1,000 prize donated by the Foundation for the Protection of Women and Children.
Peterburg Boss Quits
ST. PETERSBURG (SPT) - Igor Ignatyev, general director of state-owned St. Petersburg television company Peterburg, resigned Thursday, Interfax reported.
Ignatyev's decision to quit was connected to the intention of a shareholders' meeting to name Marina Fokina, local head of the All-Russian State Television and Radio Corp. of VGTRK, as general director, the agency quoted Ignatyev as saying.
Ignatyev said he did not expect to work for Peterburg any more, but expected to receive a post at VGTRK, where he used to work as first deputy general director.
The shareholders' meeting is due to take place on Nov. 18., when a new board of directors is to be elected. Interfax predicted Sergei Tarasov, a former Legislative Assembly deputy, and Alla Manilova, who heads City Hall's media committee, will join the board.
Robbery Suspects Held
ST. PETERSBURG (SPT) - Police have arrested three men suspected of being involved in 69 armed robberies of women, Interfax reported Wednesday.
They were described as a 23-year-old man born in Vrangel in Primorsky Krai who had been living in St. Petersburg without registration, and two local accomplices.
Knives, masks and stolen property valued at 35,000 rubles ($1,160) were confiscated from the trio, the report said.
The series of attacks, allegedly committed by the trio in four city districts, were described as especially cruel and were restricted to women, whose money, watches and jewelry was stolen.
Spokespeople Named
ST. PETERSBURG (SPT) - Galina Gromova, a former Interfax reporter, has been appointed spokeswoman for newly elected St. Petersburg governor Valentina Matviyenko, Interfax reported Tuesday.
Gromova formerly headed the press service of the presidential representative to the Northwest region. Igor Pavlovksy has been appointed spokesman for the city administration.
Envoy Summoned
ST. PETERSBURG (SPT) - The Foreign Ministry has summoned Karin Jaani, the Estonian ambassador, to explain why Estonia is deporting a group of retired Russian officers, Interfax reported Thursday.
The ministry said it has repeatedly condemned breaches by the Estonian government of an intergovernmental agreement on the pensioned officers.
TITLE: City Gets Fifth Five-Star Hotel
AUTHOR: By Irina Titova
PUBLISHER: Staff Writer
TEXT: ST. PETERSBURG - The new five-star exclusive Grand Hotel Emerald opened in the center of St. Petersburg at 18 Suvorovsky Prospect on Oct. 28, becoming the fifth hotel of that class in the city.
The Grand Hotel Emerald, which cost $20 million, was designed as a small but exclusive hotel with 93 rooms in classes ranging from Standard to Grand Royal Suite.
The Emerald, which is faced with dark glass on the outside according to the latest trends in architecture, has a classical and luxurious atrium furnished with wicker armchairs and old St. Petersburg-style street lamps.
The hotel's chandeliers and lamps sparkle with Swarowsky crystal glass. The floors are inlaid with onyx and marble of different kinds and the well-designed rooms are the epitome of sophisticated refinement.
In fact, the hotel - construction of which began in 2000 - was scheduled to open in May 2003 to accommodate tourists during the celebration of St. Petersburg's 300th anniversary.
But the hotel was unable to complete construction in time. As a result, the soft opening was in early October, and the hotel was officially opened only this Tuesday.
The Emerald is the first hotel in Russia to belong to the Summit Hotels & Resorts association.
This American association unites 145 independent hotels and provides worldwide marketing support.
The Emerald's management cites justifications to the claim of exclusiveness.
First, the hotel boasts state-of-the-art equipment and interior fittings.
The hotel is equipped with a modern system of video surveillance unlike any other in St. Petersburg. It has an interactive and satellite television system that provides Internet access in every room. There is also modern climate control, and an advanced fire extinguisher system.
"We have a very extensive infrastructure," said Kurt Ropers, the Emerald's general manager. "We have a casino, two saunas, a spa and fitness center that surpass those of the other hotels."
Second, the hotel also has its own unique approach to business.
For example, the Emerald will only accommodate individual tourists, turning away large tour groups in order to preserve the hotel's exclusive image and avoid inconveniencing guests.
"The maximum number of rooms taken by one group of tourists can not exceed 25 during low season, and 15 during high season," Ropers said.
The new hotel presents another enigma: that of its owner, whose identity is kept secret. The hotel was opened by the Neval company, which was founded by private companies from Moscow and St. Petersburg. However, the names of those companies have not been announced.
Ropers said at a press conference on Tuesday that the project was financed by Deutsche Bank, an American firm called Construction and Engineering, and some private Russian investors, whose names the manager declined to clarify, Interfax reported.
The Emerald has a business center, conference halls, an express mail service, the Emerald restaurant, Suvorovsky lobby bar, Versailles atrium cafe, a fitness center, Russian and Turkish baths, a beauty salon, a Russian billiard room, a casino, and other services.
Room rates range from $240 for a standard single room during low season to $1200 for a double Grand Royal Suite.
The Emerald is the fifth five-star hotel in St. Petersburg after the Astoria Hotel, the Grand Hotel Europe, the Corinthia Nevskij Palace Hotel, and the Radisson SAS Hotel.
Meanwhile, although St. Petersburg needs new hotels to accommodate the increasing flow of tourists, St. Petersburg hotel market experts say there is not such a need for five-star hotels.
"St. Petersburg is in need of three-star hotels," said Stephane Meyral, senior assistant at Hotel Consultant and Development Group in Moscow. "The majority of tourists coming to St. Petersburg belong to the middle class or upper-middle class, and they look for reasonable accommodation, but the city lacks such hotels."
"When news comes out that St. Petersburg has a good offering of mid-tier hotels, then tourists will flock much more readily than when the impression is limited by expensive accommodation and no alternative to exorbitant hotels," she said.
Meyral said the choice of five-star hotel founders is understandable because five-star hotels recoup expenses much faster than three-star hotels.
"It's like an expensive restaurant where each guest would pay $25 for a dinner, while at McDonald's people pay 100 rubles. But to justify its expenses McDonald's has to serve many more people," he said.
Scott Antel, the partner in charge of Ernst & Young's hospitality and leisure group, also confirmed the city's need for three-star hotels. Antel said that sometimes five-star hotels are built "despite all business analyses of the market," just because high-standard hotel owners "want to show off to their friends."
However, Meyral said that the question of St. Petersburg's need for five-star hotels is still "contradictory," since a hotel of this class "of a really renowned brand such as Hilton, Marriott, Meridien or Four Seasons would add positively to St. Petersburg's image as a city with an aristocratic past."
Antel added at the same time that although the city needs new hotels, it shouldn't be only oriented toward meeting the demands of St. Petersburg's traditional high season from May to July, when hotels are overbooked.
"You can't plan just for three months of the year or such big events as the World Hockey Championship and the 300th anniversary, if you can't keep those places occupied during the rest of the year," Antel said.
According to Antel, the solution to accommodating the city's high tourist flow in summer could lie in bringing cruise ships in to serve as additional hotels.
Meyral said the Emerald seems likely to have good future, especially considering that it has only 93 rooms, which makes it easier to fill than five-star hotels with 200 rooms.
TITLE: IN BRIEF
TEXT: Vysotsk Terminal
ST. PETERSBURG (SPT) - LUKoil will open the first stage of its oil terminal in Vysotsk, Leningrad Oblast on Nov. 30, Interfax reported Governor Valery Serdyukov as saying after a meeting with LUKoil president Vagit Alekperov Thursday.
"We are certain... the terminal will be opened for temporary use by the end of the month," Alekperov told journalists.
Construction of this stage of the terminal cost $200 million, Alekperov said.
The capacity of this part of the terminal is 4.3 million tons a year, while the entire facility will handle 10.6 million tons of oil a year.
The complex will transfer oil from Perm, Nizhny Novgorod and Ukhtinsk to Western Europe and the United States in tankers with a deadweight of up to 70,000 tons.
Peterstar Upgrade
ST. PETERSBURG (SPT) - Peterstar telecommunications operator plans to install a new Ericsson AXE-10 digital circuit exchange by the end of the year, Interfax reported Thursday.
According to a Peterstar press release, investment in the exchange and infrastructure amount to $1 million.
Peterstar general director Viktor Koresh said the new exchange will improve subscriber traffic and network resources.
This is the second such device owned by Peterstar and only the most recent step in the company's modernization program, on which $15 million have been spent in 2003.
Peterstar owns 1,500 km of fiber-optic cable in the city and covers 34.5 percent of the St. Petersburg telecommunications market.
Airport Traffic Up
ST. PETERSBURG (SPT) - Passenger traffic through St. Petersburg's Pulkovo airport grew 17.5 percent during the first nine months of 2003 over last year's figure and reached 2,951,759 passengers, Interfax quoted an airport press release as saying Thursday.
Domestic passenger traffic was up 16.3 percent and international traffic was up 18.7 percent, the same press release said.
Freight and postal traffic also grew at a rate of 25.6 percent during the same period, reaching 15,524,000 tons on domestic flights and 4,543,000 tons on international flights between January and September.
Pulkovo, a state unitary enterprise, is the largest aviation company in Northwest Russia and includes the airport and airline with the same name.
Oil Excise Taxes
ST. PETERSBURG (SPT) - Slavneft St. Petersburg, a full subsidiary of Slavneft, will start transferring petroleum product excise taxes to the St. Petersburg budget, the city's economic development committeeannounced on Thursday, Interfax reported.
The agreement was announced following a meeting of the committee's new chairman, Vladimir Blank, with representatives of the city's fuel companies.
The local subsidiaries of Neste and Tatneft also intend to send excise taxes to the city budget.
The Tax Code in force since Jan. 1, 2003 shifts responsibility for payment of excise taxes from producers to retailers.
A loophole in the law made it possible for companies to not pay the tax because there was no registration requirement stipulated.
Starting Jan. 1, 2004, the city administration will provide plots to potential filling stations only if the fuel companies pay excise taxes.
Only two of the city's fuel operators, LUKoil Northwest and PTK-Terminal, currently pay the tax. Projected revenue had been set at 2.741 billion rubles but the budget has only received 486 million rubles so far this year.
Reserves Jump $1Bln
MOSCOW (Bloomberg) - Russia's foreign currency and gold reserves grew to within $100 million of a post-Soviet high, according to central bank data sent in an e-mail to news organizations.
The reserves expanded by $1 billion to $64.8 billion in the week to Oct. 24, the central bank said. The reserves have risen $2.4 billion in the past three weeks.
The reserves rose to a record $64.9 billion on June 20. Russian foreign currency and gold reserves indicate the country's ability to pay its foreign debts, which is important for investor holding billions of dollars of the country's bonds.
The Central Bank buys dollars from oil and commodity exporters, which are bringing record amounts of currency into the country because of high oil and gas prices.
Chubais Woos Voloshin
MOSCOW (Bloomberg) - Unified Energy Systems CEO Anatoly Chubais asked Alexander Voloshin to remain board chairman, Interfax reported Thursday, citing an unidentified person. "We refrain from commenting," UES spokesman Andrei Yegorov said when asked about the report.
Newspapers reported this week that Voloshin may resign from his position as head of the Kremlin's presidential staff.
The Kremlin press service declined to comment on the reports of resignation.
New Gas Fields
MOSCOW (Bloomberg) - Russia, the world's largest natural gas producer, plans to raise output of the fuel by 3.9 percent this year as companies start extraction from new fields.
The country will produce 618 billion cubic meters of gas this year, up from 595 billion cubic meters last year, according to Deputy Prime Minister Viktor Khristenko, in a statement posted on the government web site Thursday.
"Oil companies and independent producers are showing the highest production increase," he said. Gazprom plans to raise output 1.9 percent to 531.7 billion cubic meters this year. Independent producers, excluding oil companies, are expected to boost gas extraction to 63.6 billion cubic meters this year, according to Gazprom. Oil companies will account for the rest.
Producers raised extraction by 20 billion cubic meters to 450 billion cubic meters in the first nine months of the year, Khristenko said, according to the statement.
PIMCO Buys Russia
MOSCOW (Bloomberg) - Mohamed El-Erian, who manages $12 billion of assets at Pacific Investment Management Co., said he is buying Russian bonds, betting on a recovery after prices fell on the arrest of the country's wealthiest man.
California-based El-Erian, who manages more assets than any other emerging-market bond fund manager, said he bought $25 million of Russian bonds in the past two days. Credit Suisse First Boston today recommended investors buy Russian government bonds. Russia's benchmark dollar bond plunged after Yukos CEO Mikhail Khodorkovsky was arrested on the weekend on charges of fraud and tax evasion, raising concern about property rights and foreign investment. The drop erased gains the bonds had made after Moody's Investors Service on Oct. 9 lifted the nation's rating by two levels to investment grade.
"The Yukos affair is reminding people [that] there are still questions about corporate governance, the rule of law and that there is still a strong personality cult," El-Erian said in a telephone interview.
EBRD Backs Pipeline
VENICE, Italy (Reuters) - EBRD President Jean Lemierre said on Thursday he was "quite confident" the bank's board would early next month approve a project to help fund the $2.9 billion Baku-Tbilisi-Ceyhan (BTC) crude pipeline.
The pipeline will carry landlocked crude from Azerbaijan across Turkey to international markets. Project leader BP says the line is already 40 percent complete and the first crude will flow through it in 2005.
TITLE: WEF Puts Russia in 70th Place
AUTHOR: By Valeria Korchagina
PUBLISHER: Staff Writer
TEXT: MOSCOW - Despite five years of healthy growth, Russia has yet to earn a place among the world's leading economies, the World Economic Forum said in a report issued Thursday.
The organization's Global Competitiveness Report puts Russia at No. 70 among 102 countries surveyed in terms of growth competitiveness, down from 65th out of 80 surveyed last year. The report covers 97.8 percent of the world's economy.
Neighboring Finland takes first place, followed by the United States, Sweden, Denmark and Taiwan.
The index is based on three broad categories of variables that drive economic growth in the medium and long term: technology, public institutions, and macroeconomic environment.
Russia's poor performance - it is ranked between the minor African economies of Tanzania and Ghana - is due to its high rate of inflation, which is expected to surpass the government's 12 percent target this year, inefficiencies in the banking system and a broad range of institutional factors.
In terms of inflation alone, Russia ranked No. 93.
Of the other former Soviet republics, only the Baltic states and Ukraine were included in the survey. Estonia, Latvia and Lithuania all fared well, ranking 22nd, 37th and 40th, respectively. Ukraine was ranked at No. 84, just ahead of Kenya but behind Bolivia.
The bottom five, in descending order, were Bangladesh, Mali, Angola, Chad and Haiti.
First-timers in the survey that debuted ahead of Russia include Malta (19), Gambia (55), Egypt (58) and Tanzania (69).
But even without including more countries, Russia would have fallen to 66th if last year's formula had been applied.
The main problem preventing Russia from improving by the terms of the survey is inertia on structural reform, said Natalia Orlova, chief economist at Alfa Bank.
"Russia's current growth is fueled by the development of the natural resources sector, and the growth of other sectors are dependent on this," she said.
Orlova said the structural reforms that theoretically should boost Russia's ranking - such as instituting tax breaks for struggling sectors or reducing bureaucracy - have been slow to arrive, contributing to the deterioration of the overall economic picture.
"The simple fact is that with continuing inflation and a stronger ruble, sectors other than natural resources are losing their price-competitiveness."
Another nation punished for failing to implement structural changes is China, which has the world's fastest-growing economy. It fell to No. 44 from No. 42 last year.
The report said that the fall in rank was due to the deteriorated perception of the quality of public institutions in China, as well as corruption in the public sector and lack of independence of the legal system.
ECONOMIES
The Top 10
Country Rank
2003 2002
Finland 1 1
America 2 2
Sweden 3 3
Denmark 4 4
Taiwan 5 6
Singapore 6 7
Switzerland 7 5
Iceland 8 12
Norway 9 8
Australia 10 10
Source: World Economic Forum
TITLE: Gryzlov Warns: Natural Resources Not Privatized
AUTHOR: By Alex Fak
PUBLISHER: Staff Writer
TEXT: MOSCOW - Interior Minister Boris Gryzlov issued a warning to some of the nation's largest private companies Wednesday: natural resources have never been privatized.
"All the natural resources that Russia possesses belong not to some corporation, nor to any specific person, but to the people of Russia," said Gryzlov, co-head of the Kremlin-backed United Russia party.
"And if some corporation took it upon itself to manage the resources, it does not mean that they can privatize our profits," he said in St. Petersburg, Interfax reported.
Gryzlov's comments came just two days after President Vladimir Putin publicly backed the weekend jailing of Yukos CEO Mikhail Khodorkovsky on charges of tax fraud and stealing state assets, which has raised concerns that a wider review of the privatizations of the mid-1990s, which created a handful of billionaires, may be coming.
Political observers from across the spectrum said Gryzlov's comments represented a new push by a rising faction within the Kremlin to curtail what they see as the excessive profits and political power natural resource extractors have amassed.
"This is a declaration of [the siloviki's] new economic policy - and a policy suggestion for the government," Kremlin-connected political analyst Sergei Markov said, referring to the group of former and active security service agents Putin brought to power with him. They are thought to have orchestrated the legal assault on Khodorkovsky and his oil empire.
Markov said most voters think companies should pay higher royalties for extracting natural resources and that United Russia is looking to exploit the issue during its election campaign.
He said the siloviki have wanted to do this for some time, but were held back by presidential chief of staff Alexander Voloshin, who is thought to have resigned his post in part because of the arrest of Khodorkovsky.
With Voloshin gone and Khodorkovsky in jail, the siloviki "have been reborn," Markov said. "The defeat of the syrieki [oil and metals tycoons] have given these people a new lease on life."
Independent political analyst Andrei Piontkovsky said the royalty issue is not about the struggle for justice "against the crooks" who have stolen government property. "It's just a clan from St. Petersburg trying to redistribute the wealth of the nation to their own advantage - though they will be far less effective at managing that wealth."
Presidential adviser Igor Shuvalov said last week that the issue of a special tax on "the super-normal profits" of oil companies would not be included in Putin's presidential campaign platform, but a growing chorus of Kremlin loyalists want it to be.
"This is one of the most important economic questions facing the country," Alexander Zhukov, head of the State Duma budget and tax committee said Wednesday. This is essentially a battle between the oligarchs and the state, he said, but "in Russia, the state will always win. There are no other precedents."
Raising taxes on oil and other natural resource companies has long been an option the government has considered to help diversify the economy, and most parties in opposition to the government have supported the idea.
Liberal-leaning Union of Right Forces suggests raising royalty taxes by $3.5 billion a year, while the Communists have suggested raising them by a whopping $40 billion.
According to Alfa Bank estimates, oil extractors will pay about $10 billion this year under the Unified Production Tax, which is based on extraction volumes and therefore constitutes a royalty.
In reality, however, it is impossible to measure "super-profits," economists say. "Oil price volatility makes both the expenditure and revenue side of the business quite unpredictable," said Valery Nesterov, oil and gas analyst at Troika Dialog. Good profits one year could be diluted in the long run - and this uncertainty raises the costs of investment today.
TITLE: Putin Endorses Liberal Transportation System
AUTHOR: By Lyuba Pronina
PUBLISHER: Staff Writer
TEXT: MOSCOW - Russia's vast transport system is in tatters, but annual investment of $20 billion, lifting the government's monopoly and letting investors in should fix it by 2025, according to a new transport strategy endorsed by President Vladimir Putin on Wednesday.
The system accounts for 8 percent of the GDP and employs 3.2 million people, but with around 50 percent to 75 percent of its infrastructure worn out it is facing tough challenges.
At the opening of a State Council meeting devoted to Russia's future transport strategy, Putin was quoted by Interfax as saying that the country should move away from a state monopoly in transport and learn to work with business, giving it more opportunities for investment at home, while supporting Russian transport projects internationally.
In setting out the tasks ahead, Putin stuck chiefly to the new strategy drummed up by a working group of over 100 officials and experts headed by Novosibirsk governor Viktor Tolokonsky.
If realized, the strategy will see the population's mobility go up 50 percent from the current 4,100 kilometers per person a year, provide for universal access to transport even in remote areas, and result in eight out of 10 families using a private car.
The infrastructure of ports will be boosted to allow them to service 85 percent of trade volumes, while transit shipments will jump to 70 million tons and bring in $2 billion a year.
The strategy states that with an average annual cargo shipment growth of 3.8 percent and a general passenger growth of 6.7 percent, the transport system just about meets requirements.
Yet problems persist and this threatens to slow economic growth in Russia, weakening its position on the global market.
Addressing the problems sector by sector, the strategy suggests that the government should move quickly toward adopting an international register of ships. Most Russian vessels currently operate under foreign flags when calling at domestic ports, which significantly reduces the amount of tax they pay.
The strategy also proposes opening up internal waterways to foreign vessels.
To attract more investment into road infrastructure, the strategy offers business the opportunity to build roads and keep them in private ownership with the long-term plan of eliminating state pricing and anti-monopoly regulation on road services.
Meanwhile, the aviation sector will undergo further consolidation, shrinking the number of airlines which now numbers over 200, to three dozen. One flagship carrier and three to five large airlines would be kept, along with seven charter, two low-cost, three cargo and 15 regional airlines. Some airports will be incorporated as soon as next year, among them Pulkovo, Krasnoyarsk, Khabarovsk and Vladivostok.
"The presence of the state in the transport sector should be reduced to the sphere of developing markets and creating a competitive environment," Transport Minister Sergei Frank told Interfax.
Frank said that in the past few years some 600 billion rubles had been invested in Russia's transport system, yet the same amount will be required annually to implement the new strategy, with just one fifth coming from the state budget.
Closing the meeting, Putin said that the government will give the final go-ahead to the strategy in December after it has incorporated all remarks and amendments.
"The fully-fledged strategy cannot be worked out without taking into account opinions from regional leaders," he was quoted as saying.
TITLE: GM, AvtoVAZ to Make Sedans
AUTHOR: By Irina Titova
PUBLISHER: Staff Writer
TEXT: ST. PETERSBURG - GM-AvtoVAZ announced plans Tuesday to build 17,000 Opel-Vauxhall Astra sedans per year at their joint facility in Tolyatti.
The $100 million deal is the second between the U.S. auto giant and its Russian counterpart, and will result in the first Russian-made cars under the Chevrolet brand name hitting showrooms in 2005.
"This project marks a serious step in the development of the partnership between AvtoVAZ and GM," said AvtoVAZ chairman Vladimir Kadannikov, who was in St. Petersburg to attend the northern capital's largest auto show.
Michael Burns, GM's president for Europe, said the decision was made to produce the cars in Tolyatti in order to take advantage of Russia's booming auto market, which he said was the world's eighth-largest. The Russian-made sedans will not be exported.
"The process of integration into world markets has begun for AvtoVAZ," the company said in a press release. "The GM-AvtoVAZ project is consistent with Russia's national interests and is a sign of improving investment climate in the country."
The two companies already produce Chevy Niva sport utility vehicles at AvtoVAZ's sprawling complex in southern Russia as part of a landmark $338 million investment announced by GM more than two years ago.
Tuesday's announcement comes just over a year after the first Chevy Niva rolled off the assembly line.
Since production started in September 2002, more than 17,000 Chevy Nivas have been produced. Next year, the joint venture plans to export the SUVs to Europe, Asia, the Middle East and Latin America.
Kadannikov said one of the most significant aspects of the new deal is that a third of the parts in the new sedans will be made in Russia during the first year of production, which will allow the company to price the car competitively.
Neither side, however, would say how much the car would sell for. They said the Russian Astra will look different from the European version, but they would not elaborate.
GM-AvtoVAZ general director John Milonas said the car will be competitive on quality, comfort, safety and price.
Asked why the sedan had been chosen, Kadannikov said their market research showed that the Astra-Opel model in particular would sell well in Russia.
AvtoVAZ and GM each holds a 41.5 percent stake in their joint venture. The European Bank for Reconstruction and Development owns the rest.
TITLE: Mergers and Acquisitions Process To Be Simplified
PUBLISHER: Combined Reports
TEXT: MOSCOW - The government wants to streamline the rules for mergers and acquisitions by significantly increasing the size of deals that can be concluded without the approval of the Anti-Monopoly Ministry.
Under current legislation, the minimum value of company assets that can be sold without the Anti-Monopoly Ministry's consent is 20 million rubles ($670,000), while no more than 20 percent of a company's shares can be acquired without its stamp of approval.
But now the government plans to give the green light to all deals worth less than 3 billion rubles ($100 million), with the only provision being that the Anti-Monopoly Ministry be informed within 45 days of all transactions involving more than 20 million rubles' worth of assets, said ministry spokeswoman Larisa Bulgakova.
"This change was suggested by us because we are overwhelmed by numerous small cases," she said. "Raising the minimum amount will allow us to concentrate on more important things."
The changes to the monopoly law were approved this week by the Economic Development and Trade Ministry, the Anti-Monopoly Ministry and Deputy Prime Minister Boris Alyoshin, who heads the government commission on administrative reform. The amendment will now go to the Cabinet and the State Duma for final approval.
There are also proposals to raise the percentage of a company's shares that can be acquired without the government's consent, but they have not been approved so far, Bulgakova said.
Andrei Sharonov, the deputy economic development and trade minister, said that since the Anti-Monopoly Ministry will be receiving notification of all deals exceeding 20 million rubles, any subsequent competition concerns raised by a business transaction under the 3 billion ruble threshold could be addressed by the ministry retrospectively, which might even include a company's forced breakup.
The existing rules have been criticized by the business community for creating unnecessary red tape.
"Our clients are forced to spend time on getting the Anti-Monopoly Ministry's approval even if a deal is between companies forming a group and does not affect competition," said Andrei Narutsky, senior manager at PricewaterhouseCoopers.
(Vedomosti, MT)
TITLE: Incoming Norlisk Mayor Confronts Potanin
AUTHOR: By Simon Ostrovsky
PUBLISHER: Staff Writer
TEXT: MOSCOW - Emboldened by the attack on one oligarch, the new mayor of Norilsk plans to take on another - and he appears to have the backing of the Kremlin.
Valery Melnikov said Wednesday that he owed his historic victory over metals and mining giant Norilsk Nickel's candidate in Sunday's election in part to Gennady Raikov, head of the new People's Party, which is reportedly funded by the secretive clan of siloviki in the Kremlin.
The top priority of the city's new administration will be to squeeze more cash out of Norilsk Nickel, Melnikov said by phone from Norilsk, a former labor camp that is home to the world's largest nickel and palladium deposits.
And if Vladimir Potanin, who controls the company through his giant Interros holding, "tries to stop me, he better watch out," he said.
"Potanin should not wage war against [me], in light of what has happened to Gusinsky, Berezovsky and Khodorkovsky as a result of their attempts to gain political power."
Melnikov, a former labor leader at Norilsk Nickel, which employs a quarter of the city's 230,000 people, was considered a long-shot to beat Dzhonson Khagazheyev, a former deputy director of one of the company's factories.
Even now, however, political analysts say the metals giant hasn't conceded and is using all the influence it has to overturn the election.
The local elections committee waited until nearly midnight Wednesday, the deadline for certifying the vote, before it officially declared Melnikov the winner. Inexplicably, however, the committee announced at the same time that it would take him to court for exceeding the campaign spending limit by 144,000 rubles ($4,832).
Melnikov received 51.34 percent of the vote, far outstripping Khagazheyev, who won just 34.09 percent. Five other candidates in the race all got less than 2 percent, while 9 percent voted "against all."
"The elections committee issued Melnikov his mayor ID card effective Nov. 15, but said they would take him to court for spending too much campaign money, meaning a court will decide if he gets to stay mayor," said Alexander Bugayev, Melnikov's campaign director.
Located four time zones east of Moscow, the committee could not be reached for comment late Wednesday.
With the elections originally scheduled for May, Melnikov began campaigning against the company at the beginning of the year, organizing strikes and demanding better pay and more vacation for the company's employees.
He actually won the May poll with 46.95 percent of the vote, but the election committee, which analysts say was under pressure from Norilsk Nickel, struck him from the ballot before the run-off
To nearly everyone's surprise, the three remaining candidates, including Khagazheyev's predecessor, withdrew their candidacies and the election was rescheduled for October. Vladimir Pribylovsky, president of the Panorama research center, said this was done to avoid risking the embarrassment of losing to "against all."
He said voting for "against all" is sometimes the only way voters can fight the use of "administrative resources," which, under President Vladimir Putin, has become "a popular way to get undesirable candidates thrown off the ballot."
That is why Melnikov's victory "is a rarity for our time, and a triumph of democratic principals," he said. "Norilsk Nickel has realized that you shouldn't go against the people's will, as it did in May."
Assuming that he manages to hold on to his job, Melnikov intends to force Norilsk Nickel to spend a larger percentage of its revenues on the social welfare of its workers and on the city as a whole, in the form of taxes.
"Only 15 percent of the company's revenues are spent on employees," he said. "In other countries the figure is closer to 40 percent. I consider this situation to be wrong. Their profits are to high."
For years, the company has gradually shifted responsibility for providing its employees with housing and medical and sports facilities to the municipal budget, he said.
The company reported a consolidated net profit of $315 million last year on revenues of $3.1 billion. It would not say how much it spends on its employees, but according to Melnikov's estimates the figure would be roughly $450 million. So his efforts to double that number would have a significant impact on the company's bottom line.
The company, however, said it has no intention of caving in to Melnikov's demands and challenged him to take it to court.
"Norilsk Nickel pays all the taxes it is required to by law, to prove otherwise he will have to take us to court," said Norilsk spokesman Anatoly Komrakov. "His attempts to influence how much the company pays its employees should be considered... interference into our internal affairs."
Panorama's Pribylovsky said the stand-off may never be resolved since Potanin's protectors, "are the same people who are pressuring Khodorkovsky."
TITLE: Presidential Weakness
AUTHOR: By Dmitry Furman
TEXT: On the face of it, the Russian president appears to wield far more power than most. When Boris Yeltsin was putting together the current constitution, he reserved all possible powers for himself. And these powers then passed to his hand-picked successor.
President Vladimir Putin would seem to be in an even stronger position than that of his predecessor. He is more popular. The opposition is weaker. He has taken care of the most dangerous media outlets and the least loyal oligarchs. The Federation Council is in his pocket. He has stripped governors of their legal immunity. He has just about finished building the vertikal vlasti, the strict executive chain of command. And he is putting the finishing touches on a parliamentary majority party whose platform consists of one point: loyalty to the president. It's hard to imagine what more he could do.
And yet more and more you get the impression that the president is actually weak.
Take the border dispute with Ukraine that erupted last week over a Russian dam being built in the Kerch Strait. Personally, I am inclined to believe Krasnodar Governor Alexander Tkachyov when he says that the dam was his idea, and that his reasons for building it really are no more sophisticated than the list of "economic and ecological" concerns he reels off to the press. There may be a complex subplot in all this, but one thing is clear: A major foreign policy decision, which nearly brought Russia to the brink of war with a neighboring country, was made not by the president but by a provincial governor. This kind of thing wouldn't happen in the most democratic of federal countries. What's more, Tkachyov obviously isn't worried. And Vladimir Putin is staying mum.
Then came the Khodorkovsky affair. The Prosecutor General's Office detained him after all. Everyone demanded that Putin take a stand, but at first he kept silent like a chekist under interrogation by the Gestapo. Then he came out with a slew of generalities along the lines of "Everyone is equal before the law."
This is not how a leader behaves when he possesses real power.
Putin's actions in the last week cannot be explained away as confusion or the result of his conflicting ambitions. His behavior reveals weakness, pure and simple. But is this the weakness of Putin the man, or the weakness of presidential authority in Russia?
Putin's personality is clearly a factor. When Yeltsin was choosing his successor, it seems to me that above all he was looking for someone who would not become too independent. Maybe he looked a little too hard. But the weakness revealed in the past week is also institutional and systemic.
The strength of democratic leaders derives from their ability to go into opposition. When a politician knows that the worst that can happen to him isn't all that bad, he becomes independent.
The true authoritarian ruler, the military dictator, is dependent on the power that props him up: the army. He has no choice but to indulge it. And if his army is loyal, the dictator can run the country as he sees fit.
Neither model pertains to Russia. Our leaders cannot go into opposition. Just imagine the catastrophe that would result from an investigation into the events that led to the two Chechen wars. Putin's first term is rich in such events, no less so than Yeltsin's presidency. In addition, our leaders cannot rely on a single source of physical force. Unable to free themselves from democratic and legal norms, they have to be elected. Yeltsin secured loyalty by handing out state property. Putin does not have this luxury, and this has made him an extremely cautious leader who depends excessively on his supporters and servants.
The uncontrollable billionaire Mikhail Khodorkovsky obviously presents a real danger, but there is no quick way to get rid of him. Everything has to be done "by the book" and at a safe remove from the Kremlin. But in this case, the leadership becomes dependent on the people it hires to do its dirty work. The ability to destroy Khodorkovsky and the inability to punish anyone for disasters on the scale of the Dubrovka tragedy are two sides of the same coin.
The elections have to be carefully orchestrated, of course, and no one does this as well as regional and local leaders. This means that Tkachyov, who controls a huge regional electorate, can do whatever he pleases without fear of reprisals.
Leaders who can walk away from power are free. Leaders who cannot walk away, but who are backed by some kind of military or police force, are dependent on the suppliers of this force. Leaders who cannot walk away, and who are not backed by force, are dependent on absolutely everyone. That's why setting up the Russian president is as easy as taking candy from a baby.
Dmitry Furman is a senior research fellow at the Institute of Europe under the Russian Academy of Sciences. This comment first appeared in Moskovskiye Novosti.
TITLE: Berezovsky's Prophecy Not Far Off
TEXT: If President Vladimir Putin allows his chief of staff to leave, it will destroy the balance of power in the Kremlin. Putin will have sided with his trusted buddies from the KGB over the holdovers from the Yeltsin years that he reluctantly inherited. One may wonder why it took him so long.
The outcome will most likely be a strengthening of the statist, authoritarian trends coming out of Putin's Kremlin. But will it be a death knoll for democracy?
It will be a blow to United Russia, the biggest Kremlin-supported party and the pet project of Alexander Voloshin and his deputy Vladislav Surkov.
An early hint of this came from Stanislav Belkovsky, seen as one of the ideologues behind the siloviki, who said that Voloshin's departure will have no impact on the Duma campaign because United Russia "had not earned the love of the people." What he should have said is that it never became the People's Party, the favored party of the siloviki and one of the few that cheered Mikhail Khodorkovsky's arrest.
United Russia is now the only party with support from within the Kremlin that is seen as capable of challenging the Communists in the Dec. 7 election. It will be interesting to see if this changes.
The more interesting question is what will happen to the main non-Kremlin parties.
The arrest of Khodorkovsky, which precipitated Voloshin's decision to resign, was a wake-up call for Yabloko and SPS. The liberal parties rarely agree but both spoke out to condemn what SPS called "a political contract hit." The Communists also chimed in to defend the jailed oligarch.
The arrest also galvanized the business community. The three main business lobbies issued a statement saying that it had "ruined" their trust in the authorities.
Anatoly Chubais, whose many hats include being a leader of SPS, warned that the conflict could split the elite and cause business to unite against the president.
A warning but also an opportunity. What if the attack on Khodorkovsky's oil company were to lead to the creation of a real opposition, of politicians and business leaders willing to work together and stand up to Kremlin policies they believe are wrong?
And what if Voloshin, with his firsthand knowledge of the mechanisms of "managed democracy," were to lend a hand?
Boris Berezovsky pushed earlier this year for creating an opposition alliance of the left and the right, but no one wanted to hear it. Then he predicted that Kremlin policies would so threaten the interests of leading private businessmen that by the fall they would unite in opposition. Again he was ignored.
He must be smiling in London now.
TITLE: Europeans Try To Cure Sick Justice System
AUTHOR: By Vladimir Kovalev
TEXT: Last weekend I met Professor Bill Bowring, a lawyer heading a European Union-backed project to open a chain of European Human Rights Advocacy Centers in Russia to assist Russian citizens filing complains to the European Court of Human Rights.
"Now Russia has finally got itself into a trouble," was my first thought.
This is mainly because Russia's courts have became so obviously unjust that the only remedy is for European human rights bodies to take matters into their own hands. It looks like this is the only way to force Russian authorities to change their approach toward their own citizens.
I became aware of Europe's first steps in this direction at the end of last year, when I read that the European Court of Human Rights had accepted lawsuits from Chechen citizens who suffered violence at the hands federal troops in the breakaway republic during the war that has reignited there since 1999. Some lost relatives, some lost possessions, while others' houses were looted and destroyed by masked soldiers bearing machine guns.
What all these cases had in common was that the applicants had lost faith in the Russian court system. Rather than defending citizens' rights as they are supposed to do, prosecutors act in the interests of certain officials.
Just a little bit of a history: an application filed in July 2000 by Magomed Khashiyev and Rosa Akayeva, both Russian citizens, concerns allegations of torture and extrajudicial executions of the applicants' relatives by Russian soldiers in Grozny at the end of January 2000. The bodies of Khashiyev's brother, sister and two of her sons, and Akayeva's brother were found with multiple gunshot wounds. A criminal investigation, opened in May 2000, was suspended and reopened several times, but the culprits were never identified.
At the same time, three other Chechen residents, Medka Isayeva, Zina Yusupova and Lipkhan Bazayeva, filed allegations of indiscriminate bombing of civilians leaving Grozny on Oct. 29, 1999 by Russian air force planes. As a result, Isayeva was wounded, her two children and daughter-in-law were killed, Yusupova was wounded and Bazayeva's car, containing the family's possessions, was destroyed. A criminal investigation into the bombardment was opened in May 2000, but was later closed. Appeal proceedings against the decision to close the investigation are pending before a military court in Rostov-on-Don.
Another, case filed by Zara Isayeva complains about bombing by the Russian military of the village of Katyr-Yurt on Feb. 4, 2000. As a result of the bombing, Izayeva's son and her three nieces were killed. Following a complaint to the Russian government, a criminal investigation was opened in September 2000, but later closed.
Bowring said all of these cases are soon going to be heard by the European Court of Human Rights. In the year since the European Human Rights Advocacy Center department was opened in Moscow, about 40 other cases, many of which are related to human rights violations committed by federal troops in Chechnya, have been filed and about to be sent to Strasbourg.
It was a pleasant surprise for me to hear that the center has not come under any pressure from Russian authorities while working on the cases. On the other hand, Bowring said the main problem is that witnesses and applicants are under constant pressure from the military. Witnesses are often kidnapped and applicants are threatened, to force them to withdraw their complaints.
When are they going to notice that the boomerang they have launched is already flying back to strike their heads, this time from the European Union? If there was a real will in the Kremlin to push the country forward by integrating Russia into European society, it would take some real steps and give closer attention to human rights violations across the country.
But it seems the Kremlin has a different approach, which is reflected in one simple phrase: "Let the Europeans play their game, but these cases won't be given any attention outside Strasbourg."
I really hope I am wrong in the long run.
TITLE: down-under trio heads north
AUTHOR: By Sergey Chernov
PUBLISHER: Staff Writer
TEXT: The Dirty Three, which broke to international college-rock fame in mid-1990s supporting Pavement, Sonic Youth and John Cale are to play in St. Petersburg next week. The Australian instrumental trio was formed by classically-trained violinist Warren Ellis, who is also a member of Nick Cave and the Bad Seeds,
Apart from Ellis, the Dirty Three includes guitarist Mick Turner and drummer Jim White, whom Ellis recruited from the Blackeyed Susans, the band he had also performed with at one time.
A violin-led trio might seem an unusual concept for rock music, and the Dirty Three was seen as an off-the-wall bunch from the very beginning.
"I think we were always a bit strange, particularly because we had no vocals," wrote Ellis in a recent e-mail interview from a London studio where he worked with Nick Cave and Marianne Faithfull on Faithfull's new album.
"People seem to be a bit more tolerant these days, but I still feel like we are a strange proposition for most people. In folk music, that's another thing, particularly in the East, its taken for normal.
"We are really like any folk band from the east of Europe, a guitar, drum and some sort of fiddle."
According to the band's biography, for the first concert Ellis modified his violin by attaching a guitar pickup, so the violin got that distorted, "Hendrix-like" sound.
"I eventually bought a pickup, but its still the same in principle," he wrote.
"It's a regular violin, with a pickup, I use guitar effects, and have no idea what I am doing for the most part."
Though the band's style has been frequently described as "post-rock," Ellis disagrees.
"I am happy to not be a part of that," he wrote. "In fact I thought we had escaped that label. I feel we have more in common with country [music] than post-rock."
Formed in Melbourne, Australia, in 1992, the Dirty Three left the country a couple of years later, primarily becase the members felt isolated from the rest of the world.
"We wanted to play in other countries, Australia has a small population, and we felt we were playing to the same people, and we would not have continued to exist if we had stayed there and played to the same people," Ellis wrote.
"We had seen this happen with groups playing music that did not have a home in the mainstream, bands like the Birthday Party, the Triffids, the Laughing Clowns, the Moodists, I guess we were trying to find a home for our music.
"It is a good place to work, but you feel so far from the rest of the world, in every respect, geographically, emotionally."
Though before the 2003 album "She Has No Strings Apollo," the band's members, who live in different cities, spent a couple of years working on their own projects, Ellis said the album and the current tour should not be seen as the Dirty Three revival.
"We have never disbanded, we have always been in action, I don't think any of us enjoy doing long tours these days, so when we go out its a bit special, I think that sort of thing has its time, then it doesn't, like anything, I have always been doing something, whether with Dirty Three or Nick Cave.
"Mick and Jim are always doing something as well, Will Oldham, Smog, solo projects.
"As far as I am concerned, the band has always been an ongoing concern. I have two children, which has changed things a lot for me, I tend to be more selective with any time that takes me away from them."
Though 11 years is a long time for a band, it is not waiting for its second wind, according to Ellis.
"Well, 11 years is a long time for anything, its the longest relationship I have had outside of my family," he wrote.
"I don't know how we continue, but I guess there is something within the group that we all love, and try to maintain. I am still waiting for the first wind."
Performing with Nick Cave and the Bad Seeds brought Ellis and, subsequently the Dirty Three, probably not only some additional publicity but also attention from Cave fans. Ellis said he is not irritated by the questions about Cave.
"No, he is an interesting man, I am always happy to play with Nick," he wrote.
"Playing with the Bad Seeds is a different thing, I am happy to play in different settings. Music is like conversation, you need to do it with lots of people.
"I feel we are fortunate in the band that we all do different things, we all bring something back to the group. I think it has added to the longevity of the band."
Though the Dirty Three has never performed in Russia, Ellis toured Moscow and St. Petersburg with Nick Cave and the Bad Seeds in 1998.
"I had a nice night dancing with [the Bad Seeds' guitarist] Blixa [Bargeld] outside a club.
"I really like Russian cinema, and Tarkovsky's memoirs 'Sculpting in Time' had a big influence on me," he added.
At its Russian concerts the Dirty Three will perform material from its whole 11-year history.
"We will be playing songs from all our albums - the hits and the misses," wrote Ellis.
The Dirty Three performs on Nov. 8 at Red Club. Links: www.dirtythree.com
TITLE: halloween catches on in the city
AUTHOR: By Sergey Chernov
PUBLISHER: Staff Writer
TEXT: Though imported relatively recently, Halloween is now big in Russia - actually so big that the Moscow authorities, infamous for the ban they put on the ska-punk band Leningrad because they did not like the lyrics - noticed it and recommended that it not be celebrated in schools.
The festival with its pagan origins somehow does not sit well with Orthodox Christian values they struggle to impose. But many Russians seem happy to buy pumpkins and all kinds of Halloween paraphernalia in anticipation of the parties that go with the event.
Though now mainstream, underground clubs, especially Fish Fabrique, which probably was the first to stage a Halloween party in the city in 1993, continue to arrange all kinds of events to mark the day.
"For us it's our tenth Halloween, quite an anniversary," said Fish Fabrique's Olga Zaporozhtseva. "Everything will be as usual - no costume, no entrance; [there will be] pumpkins [and] scary things."
The program features a gig from the local pop-funk band Kamikaze and all kinds of contests, including one for best costume. Tickets will cost 150 rubles.
Despite the rumors, the popular hangout Cynic does not plan anything special for the night. "If club members want to put together something, they are welcome," said Cynic's founder Vladimir Postnichenko on Thursday. Entrance is free.
The house club PAR.spb, which will celebrate its second anniversary next week will throw a Halloween party headlined by Manchester's DJ Martin Lever. DJs with such names as cloakroom Attendants from Mama and Vitya the Sadist will add to the atmosphere. Entrance will cost 350 rubles.
Heavy-metal rock friendly club Orlandina will promote the "Iron Helloween Fest". Be prepared to leather-clad fans and music ranging from thrash metal to death metal as performed by Psilosybe Larvae, Black Astrology, Bestial Deform,Wolfsangel, Morrah, Septima, áÓ', Mosaic of Soul, Mesantrope Count Merciful and Citadel. Entrance: 150 rub.
Red Club, which recently launched the all-night R&B Cafe Cadillac on its second floor, will bring Swedish dance duo Z Prochek, whose work described on the band's official site as "intelligent, dark and truthful." The club's management was not immediately available for details, but usual entrance fee is between 200 and 300 rub.
On Friday, Halloween night itself, the lesbian club Triel will host transvestite "parody" show Nevsky Kaskad, as well as hold a carnival. Entrance: 200 rubles (men), 100 (women). Women not wearing Halloween costumes will be charged the full 200 rub.
TITLE: chernov's choice
TEXT: Halloween looks like the biggest reason for people to venture out this week, although there are lots of other gigs and parties going on.
On Friday night, when everybody will be having fun with pumpkins and freaky costumes, Stary Dom, for instance, will be celebrating Samhain, the Celtic New Year, with a concert of three folk bands playing Irish and Scottish songs.
But the biggest concert of all (at least the venue is the biggest) is by a-ha, Norway's most valuable music export. Though the band's popularity has faded since its heyday in the 1980s, the concert at the Ice Palace on Friday is probably aimed at managers and businessmen, who were teenagers when a-ha was really popular in Russia.
There are more international acts similarly appealing to the well-to-do. The U.S. duo Thunderball, for example, which plays Tinkoff beer restaurants in Moscow on Friday and St. Petersburg on Saturday.
The band, which comes from Washington D.C., consists of Sid Barcelona and Steve Raskin. Raskin, a punk renegade and the duo's better known member, was a member of D.C.'s post-punk band Edsel and an album cover designer for local indie labels Dischord and Simple Machines.
Their current music product has little to do with punk (they do not let punks into Tinkoff), but the band claims has kept its D.I.Y., or "do-it-yourself," approach since those glory days. Check www.thunderballdc.com for more information.
Another lounge act which is likely to attract trendy local party-goers is Japan's Qypthone.
Fronted by female singer Izumi Okawara, the band is expected to produce some sort of smooth pop music fit to the interiors of Aquarel restaurant, where it will perform on Friday.
The band's official Web site, at www.qypthone.com, is mostly in Japanese.
Camouflage is probably for not such a refined audience. Actually, it is a German band, which once played synth pop just like Depeche Mode did and has kept producing it when it fell out of fashion and even Depeche Mode moved on.
The concert's location has changed from the Lensoviet Palace of Culture to the even more modest and distant Palace of Youth. After the concert, activities, including an autograph-signing session, will continue at Red Club.
Sweden's Jump 4 Joy is a slightly unusual band for Jazz Philharmonic Hall, which specializes in mainstream jazz and Dixieland.
The band describes its style as a "combination of boogie-woogie, jazz, blues, stand-up comedy and traditional rock'n roll."
Led by pianist and singer Ulf Sandstrom, it includes Bo Gustafsson on saxophones, Anders Almberg on drums and Anders Olsson on double bass.
Jump 4 Joy will perform at Jazz Philharmonic Hall on Wednesday.
Italian jazz accordion player Renzo Ruggeri, who on his Russian tour now, visiting such cities as Petrozavodsk and Chelyabinsk to play six concerts and give three seminars on accordion jazz, will make it to St. Petersburg this week.
He will play at JFC Jazz Club on Tuesday, even if his Web site, at www.renzoruggieri.it, gives a different date and venue.
- By Sergey Chernov
TITLE: time to discover the land of lunch
AUTHOR: By Matthew Brown
PUBLISHER: Staff Writer
TEXT: Western ways of doing business may be slow to catch on in Russia, but the concept of "Business Lunch" has really taken root. Like all good ideas, it prospers because it is simple: a set menu for a flat fee which operates in during the slack hours of a restaurant's day. However the temptation must there for restaurateurs to exploit the idea by foisting yesterday's unsold food on today's lunch crowd. The flat fee can also mask skimping on portions, and the set menu can deaden the creativity of the chef.
None of these hazards apply to the business lunch available at Khristofer, an amiable fish restaurant in the heart of St. Petersburg's "restaurant quarter" (on and around Ulitsa Bolshaya Morskaya).
By night, this restaurant is quite a classy place, and when it was reviewed by The St. Petersburg Times in 1999 shortly after it opened, my colleague spent over $50 (at least $75 in today's money). Four years later and by day Khristofer offers a four-course business lunch for just 210 rubles ($7). As a way of attracting customers it clearly works - on a rainy day this week the place was at least a quarter full - but is it any good?
The menu offers a good selection from which to compose your four courses: three types of salad, four soups, four main dishes and two desserts (mineral water - still or sparkling - is complimentary). The English-language menu has been expertly written to make what are fairly straightforward dishes sound tempting and the description of the traditional Olivier salad was the most attractive.
In reality, the salad was a simple, well-prepared combination of diced boiled potato, raw cucumber, peas, and tiny pieces of canned chicken breast in mayonnaise - exactly what an Olivier salad should be.
Likewise the borshch that followed was hot and tasty and had clearly been prepared with a rich meat stock which, as any Russian will tell you, is the secret of this king of soups.
On the other hand, the main course was nothing to write home about. It consisted on two overcooked slices of pork in a cream sauce, topped with wafer-thin slices of fried tomato, a la Full English Breakfast. The oven fries it came with were, well, oven fries.
Finally, the fruit salad consisted of chopped apple and banana slices and a very small amount of fibrous material which, once isolated, turned out to be canned pineapple.
The meal was altogether very filling and pleasant, and excellent value. The check reveals that without the business lunch discount, the meal would have cost 357 rubles ($11.90), still reasonable for one person without wine or beer. But the real value comes in Khristofer's progressive understanding of service.
In keeping with its nautical theme (the restaurant is named after Christopher Columbus) you are greeted at the door by a young man dressed as something like an 18th century cabin boy.
The wait staff, meanwhile, were neither inattentive nor pushy and, in a sign of class, the second setting on a table set for two was cleared for the single diner. The interior carries a maritime motif without it becoming overpowering: an empty bird cage; an aquarium of fancy fish; rope and wooden details (even the light switches are made of wood). A slight niggle comes when you are seated - the solid wooden legs of the tables don't leave much leg room. Lastly, the bar is a thing of beauty, modeled like a sailing ship in the spirit of the Santa Maria.
When it comes to providing a tasty, simple and value-for-money daytime meal, Khristofer is the business.
Khristofer, 27 Ulitsa Bolshaya Morskaya. Tel: 312-9761. Credit cards accepted. Menu in Russian and English. Business lunch (12 p.m. to 5 p.m.) for one, no alcohol 210 rubles ($7).
TITLE: art therapy tackles society's trouble
AUTHOR: By Andrei Vorobei
PUBLISHER: Special to The St. Petersburg Times
TEXT: Can art heal society's problems? That's the question a new exhibition which opened on Monday in the "Manezh"Central Exhibition Hall asks, with some works providing more satisfactory answers than others. The exhibition is part of "Rokhto," an ongoing project which grew from a more specific question posed by Finnish artist Markus Renvall. He wanted to know if art can "cure" social "diseases" which often occur among young men between 16 and 24, like suicide, violence, and identity problems. In order to "diagnose" and find a "medicine" for these, a series of art events under the "Rokhto" banner was initiated. "Rokhto" - the Finnish word for drug - has already taken place in Finland, the UK and Norway.
For the Russian version, Renvall invited young but established artists from Russia and the Nordic countries of Finland, Sweden, Denmark and Iceland to participate, with the support of The Nordic Council of Ministers. Most of the Russian artists are graduates of the St. Petersburg-based Pro Arte Institute, although there are a couple of prominent local names like "Tsaplya" (Heron) and the art group "Musorshiki" (Dustmen) taking part.
Renvall's concrete intentions and the original target group were extended to a wider context - art as medicine for society in general - for the current project. At the same time, stressing two contemporary art features - socially concerned art and video as media - it offers an engaging set of approaches to conceptualizing society's diseases and offers different art strategies to "heal" them.
One such approach represented at the exhibition could be called the de-automatization of the perception of reality by the means of art - when an artist wishing to attract attention to some social issue puts it into a strange, unfamiliar context. The best example of this is "Dom nochnogo prebivania" (in Russian it is also known as "Nochlezhka," the place where homeless people spend the night) by Tatyana Goloviznina. She puts three video pieces made in the local "Nochlezhka" onto screens set in gilt picture-frames, drawing the visitor's attention to the problem at the same time as aesthetizing the problem.
Another characteristic tendency in art today, in which art occupies public spaces both physical and mental - from streets and buildings to ash trays - is represented in the work "Search and Upgrade" by Alexei Spy and Nikita Cherevkov (Mikka).
The art therapy movement is signaled in such works as "Detskaya Ploshchadka" (Children's Playground) by "Musorshiki," "Cabins For Resolving Problems" by Marcus Renvall, and Lyudmila Belova's work "Gde Ya" (Where Am I?). Meanwhile Nikolai Recke's "Sweden Hair" and Olga Yegorova's (Zaplya's) "Kak ponravitsa Valye" (How to please Valya) examine identity issues.
All these socially-charged art works are however diluted in the "Rokhto" exhibition by some non-committal mainstream pieces like "Objects of Desire" by Anna Kolosova or "Medicine for Society" by MAK 555 which are made in the style of Godfrey Reggio's recent film of his QATSI trilogy - but are less interesting.
Master classes and workshops by the artists will be held as part of the event with those by Danish artists Lilibeth Cuenca and Nikolai Recke, and those by the Finnish video-art-sound group "Pink Twins," top of the bill.
"Rokhto" runs at the Manezh through November 14. Details of workshops and master classes: Tel: 117-4473. Links: www.manege.spb.ru
TITLE: philharmonic wows hong kong
AUTHOR: by Kevin Ng Special to the St. Petersburg Times
TEXT: HONG KONG - Last weekend the 100-strong St. Petersburg Philharmonic Orchestra returned to Hong Kong after an absence of nine years for three concerts of different programs as part of their Asian tour.
The orchestra, under director Yury Termikanov, was merely the latest in a long line of distinguished artists from St. Petersburg to include Hong Kong on their international tour schedules. Last December the Mariinsky Ballet gave a week of sold-out performances in Hong Kong as part of a China tour to great acclaim, and in mid-November the renowned soprano Galina Gorchakova from the Mariinsky Theater will give a recital, to be followed by the St. Petersburg Chamber Choir in December.
The Philharmonic's Hong Kong concerts were the last of a five-week Asian tour which included performances in Taipei, , Taiwan, Seoul, South Korea, Tokyo and other Japanese cities. The orchestra flew from Hong Kong to Berlin to perform a special Rachmaninov program at a single concert at the Berlin Philharmonic Hall, before eventually returning to the snow of St. Petersburg.
In an interview last Friday afternoon, just before rehearsals for the first Hong Kong show, Termikanov said: "The reception of our Asian performances has been very good. I find the Asian audiences more enthusiastic than the audiences in Europe. Traditionally the [St. Petersburg] public ... is more restrained in their applause."
The orchestra's opening concert at the Hong Kong Cultural Centre last Friday was unfortunately overshadowed, in terms of media attention, by a rock concert on the same night given by two Russian teenagers Lena Katina and Julia Volkova - otherwise known as Tatu. All the tickets for the Tatu concert were given away free to boost the controversial "HarbourFest" pop festival which had up until then been very poorly attended due to insufficient publicity and incompetent organization.
Nevertheless, the St. Petersburg Philharmonic Orchestra's first concert, which was recorded by Radio Hong Kong, was a tremendous success with many ovations from a full-house audience. The headline for the review in the South China Morning Post said it all - "A Night of Virtuosity and Sheer Grandeur."
The critic Vincent Mak enthused: "The fabulous brass section of the orchestra especially dazzled with wonderful sonority."
The first half of the concert was comprised of Tchaikovsky's Piano Concerto No. 1, which was brilliantly performed by the Russian pianist Vladimir Feltsman. After a magnificent performance of Mussorgsky's orchestral showpiece "Pictures at an Exhibition," Temirkanov was generous enough to give two encores to satisfy the enthusiastic audience. The second encore was the scene depicting Tybalt's death from Prokofiev's "Romeo and Juliet," a performance even surpassing that of the orchestra of the Mariinsky Theater.
The St. Petersburg Philharmonic Orchestra was hailed in a review in the London Guardian last year as "arguably the greatest orchestra in the world."
But some critics said the orchestra's program in Hong Kong was predictable, consisting only of work by Tchaikovsky, Rachmaninov, Mussorgsky, and Dvorak but without any work by modern Russian composers. Termikanov deflected the criticism: "The program for each Asian city was decided by each individual concert hall. Actually, in Japan we played in one concert an overture composed only last year for our orchestra by Anatoly Korolev."
He added that Japan was the highlight of this Asian tour. "In Japan we opened a special music festival dedicated to the 300th anniversary of St. Petersburg, with some participation from the Japanese government. A princess attended the opening concert." But due to the busy schedule of the orchestra on the road, it did not have any exchanges with any Japanese orchestras, and Temirkanov didn't have time to give any master classes.
With winter now underway, the St. Petersburg Philharmonic is embarking on its traditional series of foreign tours, Termikanov said.
"In December the orchestra is going to Italy to open La Fenice Theater in Venice. Next February there will be a tour of Germany and Austria. And later there will be an American tour."
TITLE: 'the return' is well-crafted art
AUTHOR: By Tom Birchenough
PUBLISHER: Special to The St. Petersburg Times
TEXT: Since its various triumphs - including awards for best film and best debut - at the Venice Film Festival in September, Andrei Zvyagintsev's "The Return" (Vozvrashcheniye) has hardly left the news in Russia.
Coverage has been balanced roughly between the tragic death of one of its lead actors, Vladimir Garin, after completion of shooting, and the question as to whether the film would receive wide national distribution through the major channels (it didn't).
To a certain extent, such an approach, however necessary in local promotion, as well as on the launch of the film's path to the best foreign language film Oscar nomination, has drawn attention away from the work itself - a result particularly inappropriate for one of the best crafted Russian films in recent years. Such an integral and finely honed vision is also remarkable for its professionalism, a quality all too lacking recently.
Debut director Zvyagintsev has created a spiritual landscape which owes more to art than to reality. He has singled out Moscow's Film Museum as one of the institutions to which he owes a debt, and there's an evident knowledge of and sensitivity for cinema, as well as art history, which pervades his vision.
The setting of "The Return" is consciously distant from any specific Russian external reality, consciously concentrating on the interior world of the film's protagonists. Its world, developing around a small town and the rural areas of the country's northwest, avoids almost any hint of exact location and the darkness of social environment which could so easily have colored its presentation of "post-Soviet" reality.
Thus we see few urban exteriors, and those which do appear would be at least as much at home in northern Europe or Scandinavia as in Russia. Initial adolescent games and taunts unfold in a setting which is definitely not decayed in the manner of "chernukha," the willful blackness of presentation of a certain strand of Russian culture through the last decade, while the grand natural - and almost entirely empty - landscapes of the larger part of the film are equally unspecific.
The cast itself is just as sparse - two boys barely into their teenage years, living with their mother and grandmother - until their apparently steady world is unexpectedly disrupted by the return of their father (Konstantin Lavronenko): exactly from where - from war, prison or elsewhere - is never stated.
Such understatement and absence of comment, on both emotional and narrative fronts, colors the film, creating an effect which is unsettling for the viewer, albeit on an unconscious level. In another work, its blurring of character and environment might appear a directorial oversight; instead, Zvyagintsev embraces it without compromise as part of his vision (comparisons with Andrei Tarkovsky have been frequent).
Some of the details of the domestic setting in which the family lives indeed appear initially out of place, among them the visual style of their home, governed as it is by an artistic symmetry and stylized bareness. Images appear which abound in conscious echoes from art history - most notably allusions to Renaissance Italian artist Mantegna's depiction of the dead Christ; other startling details stir associations with an overtly religious subcontext, as when the family conspicuously marks its reunion at dinner with wine or when the boys, rooting through an attic trunk, find their only photograph of their father tucked between the pages of a bible.
The film's emotional dynamic begins when Ivan (Ivan Dobronravov) and his older brother Andrei (Garin) set off on what appears to be an innocent fishing trip with their father, but shortly turns into a conflict of wills between the two sides. Seemingly determined to break their characters, the father puts his sons through a series of trials to which each reacts in his own way - Andrei by trying to adapt himself to the demands of his stern and silent parent, Ivan behaving with a sulky defiance which smolders beneath his no less taciturn behavior.
The length and development of this part of the film may seem overlong to some, but it simultaneously places the viewer in the boys' place, forcing a sympathy. Their final destination, reached after a grueling journey by boat through an impressive storm, is a deserted island, the setting of which provides the context for the denouement.
Exactly why their father has headed for this place remains equally unclear. Two brief scenes which might explain that direction remain undeveloped.
Finally, it is the film's achievement that such questions do not dominate, but rather hint at another level to the protagonists' relationships. Moving into its final 20 minutes, the story ascends to a different, mythic plane which resonates with considerable conviction in its finale.
Flaws in the film, such as they are, are illustrated by the character of the father. Without a social context by which his "return" and motivations might be explained, Lavronenko struggles to convince, remaining a cypher distinguished mainly by the craggy outlines of his face. Both boys are outstanding in showing their vulnerabilities, especially Dobronravov as the younger brother.
Facing the highest local expectations, Zvyagintsev has delivered a film which will intrigue many viewers and convince others on an emotional level which is far from clear-cut.
Like its closing shot, it's ambiguous whether the film's title refers to the return of the father or the return to a beginning which itself is unclear.
It's an ambiguity that deserves to be savored, not least in the context of contemporary Russian cinema.
TITLE: soldier's book has politics in mind
AUTHOR: By Max Frankel
TEXT: In the front of his austere black-and-white book jacket, General Wesley Clark is presented as the former supreme allied commander in Europe and the author of what purports to be an expert analysis of the war in Iraq. But on the book's back side, you will find a colorful full-page poster of a handsome civilian with a winning smile and the unmistakable ambition to commit more than military history.
"Winning Modern Wars'' turns out to be aptly wrapped. For its 200 pages, many of them updated just a month ago, are obviously designed to abet the swift transformation of a once embittered warrior and armchair television analyst into a hard-driving, platitudinous candidate for president.
That jacket speaks louder than the coy words with which Clark denies any partisan purpose. He allows that while writing he heard "continuing speculation about whether I might engage in some manner'' - sic! - "in the 2004 election." But that "looming decision had no bearing on my analysis.'' His only aim, he insists, is to give voice to the soldiers "far from home, in an uncertain mission,'' because they "cannot and should not speak for themselves.''
Well, those soldiers and their fellow citizens can vote. And the general cannot camouflage the partisan thrust of his polemic. His deft review of the battlefield tactics that won Baghdad in less than a month is merely the preface to a bitter, global indictment of George W. Bush. The president and his administration are condemned for recklessly squandering a brilliant military performance on the wrong war at the worst possible time, diverting resources and talent from the pursuit of al-Qaida, neglecting urgent domestic needs and dissipating the post-9/11 sympathy and support of most of the world.
No credit is given even for the one thing that Clark admires about the U.S. performance in Iraq. He recounts with relish the "synchronization of high-tech airpower with agile ground maneuvers'' - how the rapid advance of armor forced Iraqi units to move and expose themselves to air and rocket attacks, which in turn facilitated more ground advances. But "the irony is that the vision of ... a high-tech battlefield, viewed through an array of sensors, with battles fought and won by precision strikes and a slimmer ground component - which the Bush administration, and especially Donald Rumsfeld, have trumpeted, is largely a reality that they inherited when they took office in 2001.''
In any case, the war in Iraq, though generally well fought, was a costly diversion. "Taking down Saddam became a hobbyhorse'' for the group around Rumsfeld even before they achieved authority over the Pentagon. And they exploited 9/11 as "a gift-wrapped opportunity'' to try to "clean up the Middle East.'' So instead of concentrating on a "knockout blow'' against al-Qaida, they turned the focus to Iraq and let the terrorists scatter from Afghanistan.
As portrayed by Clark, the attack on Saddam Hussein - without evidence to link him to al-Qaida - was not only wrong but deeply cynical. It bespoke a cold war mindset of assigning terrorists a state sponsor, a "face'' that could be more easily attacked. "It was almost certain to be successful. It emphasized U.S. military strengths and built on a decade of preparation for a refight of the gulf war.''
The benefit of toppling Hussein is only faintly acknowledged: "All else being equal the region and the Iraqi people were all better off with Saddam gone. But the U.S. actions against old adversaries like Saddam have costs and consequences that may still leave us far short of our objectives of winning the war on terror - or, in themselves, may actually detract from our larger efforts.''
Clark dwells, at great length, on the need for "a new strategy for the 21st century - a broader, more comprehensive and less unilateralist approach abroad coupled with greater attention to a sound U.S. economy at home, and long-range policies to take our nation forward successfully into the future.''
It is a breathtaking vision. Besides sidling out of Iraq, a President Clark would strengthen "and use'' international institutions, "repair'' trans-Atlantic relations, "resolve'' the nuclear challenges of North Korea and Iran, help settle "disputes'' between India and Pakistan and Israel and the Palestinians, and help to "ease the ongoing conflicts'' in Africa. He would increasingly employ "the weapons of law enforcement rather than warfare in attacking terrorism,'' focus more on the "root causes'' of Islamic terrorism and provide "substantial economic and political development assistance'' to stimulate "far-reaching reforms in critical societies in the Middle East.''
In America, too, he favors "a fresh effort'' to balance private initiatives and public responsibilities to enlarge opportunity and strengthen the nation's competitiveness.
Clark glibly lists these objectives, and many more, without suggesting any priorities of effort. And he makes no attempt to explain how any American leader could effectively reconcile so many conflicting ambitions and sovereignties. His self-confidence seems rooted in his experience as commander of the NATO forces that bombed and pacified Kosovo in 1999, a headstrong performance that enlarged his faith in international collaborations while it poisoned his relations with peers and superiors at the Pentagon.
As Clark recounted in a previous book, "Waging Modern War,'' his enemies in Washington managed to trick the Clinton White House into firing him from the post of supreme allied commander in Europe. And so he was left to watch from a CNN studio as a new administration employed the battle doctrines he had long championed in what he bitterly concluded was a misguided cause in Iraq. It was enough to drive a man to print, and to think he could do better as commander in chief.
Max Frankel, a former executive editor of The New York Times, is completing a history of the Cuban missile crisis.
TITLE: the word's worth
AUTHOR: By Michele A. Berdy
TEXT: A sudi kto?: Who are they to judge? Look who's talking! (said of hypocrites or people incompetent to judge someone or something, from Griboyedov's play "Woe from Wit").
One of the comforting facts of Russian life is how little it has changed over the centuries. As one of Griboyedov's characters says in "Woe from Wit" ("Gorye ot uma"), "Doma novy, no predrassudki stary" (The more things change, the more they stay the same, literally, "the houses may be new, but the attitudes are old").
If you have forgotten (or if you pretend you've forgotten, but actually have never read the play or seen it performed), "Woe from Wit" is the story of a Russian nobleman who returns home after a tour of Europe and is appalled by the pettiness and hypocrisy of Russian life, which he spends most of the play criticizing with sharp-tongued eloquence. At the end of the play, he is rejected by his love and ostracized by society. It may not sound like a barrel of laughs, but it is a remarkably fresh and funny play that has given the Russian language a plethora of what Russians call krylatye slova, literally "winged words," or more commonly, aphorisms.
One phrase you hear quite frequently is (geroy) nye moyevo romana, which means "he's not my type," "he's not for me." On tyebye ponravilsya? Da, on priyatniy chelovek. No nye moyevo romana. (Did you like him? Yes, he's a nice enough guy. But he's not my type.) If he were your type, and you spent endless hours gazing into each other's eyes (or something like that), Griboyedov gives you a good expression to use to describe the heady feeling of love: Schastlivye chasov ne nablyudayut (how time flies when you're happy, literally, "happy people don't notice the time"). Or let's say he was your type, but you had a falling out. That's when you can proclaim: syuda ya bolshye nye yezdok! (I'll never set foot in here again!); often it is misquoted as: syuda ya bolshye nye khodok!
"Woe from Wit" also gives you several expressions to use when heaping or receiving praise and false praise. To describe someone who is well-spoken, you can say: i govorit, kak pishyet! (And he speaks just like he writes!) Or: Slavno govorit perevodit (he speaks beautifully, and translates, too). Today, these expressions are more commonly used jocularly. If someone says this of you in a tone dripping with sarcasm, you can say: Nye pozdorovitsya ot edakikh pokhval (you shouldn't shake hands with someone who praises you like that). On khvalil menya za moyu prostotu i naivnost. Nye pozdorovitsya ot edakikh pokhval (He praised me for my simplicity and naivete. What a back-handed compliment!)
Uchilis by na starshikh (you ought to learn from your elders) is a handy phrase when you want to make sure the young person sitting across from you appreciates it.
Or let's say you are slandered. You can moan: akh, zlye yazyki starshneye pistoleta (sharp tongues are more deadly than a gun).
And then there's another bit of woeful wisdom that is as apt now as it was in Griboyedov's time: minuyut nas pushche vsekh pyechaley i barskiy gnyev, i barskaya lyubov. This means literally, may we be saved from that which is worse than any misfortune - the lord's ire and the lord's love. That is, both the love of the powers-that-be and their anger are equally dangerous: If they notice you, for better or for worse, they'll cut you down. It's a phrase someone might be writing on a prison cell wall right now.
Michele A. Berdy is a Moscow-based translator and interpreter.
TITLE: First Ambush Of Troops in Central Iraq
PUBLISHER: The Associated Press
TEXT: BAGHDAD, Iraq - Insurgents destroyed an American tank north of Baghdad, killing two U.S. soldiers and wounding seven Ukrainians in the first ambush against the multinational force patrolling central Iraq, officials said Wednesday. The attacks are part of a dramatic upsurge in recent days.
The United Nations said late Wednesday that it was temporarily pulling its remaining staff out of Baghdad, continuing the exodus of international organizations from the Iraqi capital. The U.N. decision was announced two days after a deadly suicide car bombing at the Baghdad headquarters of the Red Cross.
The international Red Cross announced earlier Wednesday it was reducing its international staff. The humanitarian group Medecins Sans Frontieres, or Doctors Without Borders, also announced it had pulled out workers.
"We have asked our staff in Baghdad to come out temporarily for consultations with a team from headquarters on the future of our operations, in particular security arrangements that we would need to take to operate in Iraq," U.N. spokeswoman Marie Okabe said.
The upsurge in violence was being caused by foreign fighters, the Iraqi Governing Council said Wednesday. The council called on neighboring countries to crack down on infiltrators crossing into Iraq and provide information about former regime figures who may be hiding on their soil, according to a statement carried by the Arabic language television station Al-Jazeera.
TITLE: Super Mario Nears Gretzky's Goal Tally
AUTHOR: By Ira Podell
PUBLISHER: The Associated Press
TEXT: With each goal and point, Mario Lemieux and Brett Hull further pad their Hall of Fame credentials
Lemieux set up teammate Dick Tarnstrom to reach 1,700 career points, and Hull scored his 718th goal to move into sole possession of fourth place on the NHL list Wednesday night.
Neither, however, could enjoy much else.
Lemieux's Pittsburgh Penguins squandered a two-goal lead to the New York Islanders in a 4-4 tie, and Hull and the Detroit Red Wings lost a 6-5 shootout to the St. Louis Blues.
"I thought we were going to win the way we played the first two periods,'' said Lemieux, who has points in seven straight games. "It's disappointing.''
In other NHL games, it was Anaheim 4, Washington 2; Philadelphia 5, Florida 1; and Dallas 4, Calgary 3 in overtime.
Hull scored with 1:10 remaining to snap a tie with Phil Esposito. Only Wayne Gretzky (894), Gordie Howe (801) and Marcel Dionne (731) have more NHL goals.
Lemieux is just the sixth player to reach the 1,700-point plateau, and only Gretzky did it faster.
"It's nice to get it out of the way,'' said Lemieux, who has 683 goals and 1,017 assists in 887 games. "Sometimes when you're going for a milestone, you try to do too much.''
Doug Weight did plenty for the Blues by scoring three times for the second time in his career. He had plenty of help from Dallas Drake, who assisted on five of St. Louis' six goals.
Drake, one of the league's hardest hitters, didn't have any points in his first six games this season.
"I really pay no attention to points and goals,'' Drake said. "All of my assists were pretty cheesy ones. I just happened to get the puck to the right guy at the right time.''
New York led Pittsburgh 2-0 before yielding four straight goals. Martin Straka, rookie Ryan Malone and Mike Eastwood also scored for the Penguins, but the Islanders' Jason Blake and Mariusz Czerkawski scored in a 2:48 span of the third period to tie it.
"When we were down two, we felt we had the better team and we had to show it,'' said Czerkawski, who has eight goals this season.
Shawn Bates and Alexei Yashin also scored for the Islanders.
Pittsburgh was 0-for-8 on the power play.
Flyers 5, Panthers 1 At Philadelphia, Michal Handzus and Joni Pitkanen each had a goal and assist, and Robert Esche stopped 21 shots for the Flyers.
Justin Williams, Jeremy Roenick and John LeClair also had goals for Philadelphia (4-1-3). Mark Recchi, Tony Amonte and Simon Gagne added two assists apiece. Viktor Kozlov scored for the Panthers, who have lost two ofthree.
Mighty Ducks 4, Capitals 2 At Washington, Sergei Fedorov scored two goals and Martin Gerber made 23 saves for Anaheim. The Capitals lost their sixth straight and are winless in eight games since opening with a victory. The losing streak is their longest since they dropped the final six games in 1998-99. Gerber has allowed four goals in three games in place of Jean-Sebastien Giguere, who struggled in Anaheim's early losses. Jason Krog and Steve Rucchinalso scored for the Ducks.
Stars 4, Flames 3, OT At Dallas, Jason Arnott scored 17 seconds into overtime and Bill Guerin had three goals as Dallas rallied from a two-goal, third-period deficit.
Calgary led 3-1 when Guerin notched his second of the night on a power-play rebound with 10:32 left in regulation.
Guerin tied it with 8:35 remaining for his sixth goal of the season. That goal completed his first hat trick for the Stars and the fourth of his career.
Jarome Iginla, and Oleg Saprykin scored for the Flames.
TITLE: No Wrong Way to Swing Bat
AUTHOR: By Carl Schreck
PUBLISHER: Staff Writer
TEXT: BELGOROD, Central Russia - Boston Red Sox pitcher Pedro Martinez might not chalk up so many strikeouts if he were forced to stand next to the hitter and gently toss the ball straight up, and Giants slugger Barry Bonds might not be threatening baseball's career home run record if he had to start his swing with the bat between his legs.
But these are the pitching and hitting techniques of Russian lapta, a game that some claim was the inspiration for America's national pastime, and since Sunday, 15 teams - 10 boys' and five girls' squads - have been duking it out in this traditional stick-and-ball game at the Russian College Lapta Championship.
Lapta is an ancient Russian sport - wooden bats and leather balls dating back to the 14th century have been discovered in Veliky Novgorod, according to the Russian Lapta Federation - and though historians generally credit New York bank teller Alexander Cartwright with inventing baseball in 1845, lapta fanatics like to point out Russia's contribution to the Grand Old Game.
"Our theory is that Russian immigrants or Jews from Odessa brought lapta to America, and baseball evolved from there," said Sergei Fokin, the federation's vice president. "Lapta is a much older game, and there are so many similar concepts: tagging runners out, hitting and catching fly balls, for example."
An explanation of lapta can be as disorienting to the uninitiated as an explanation of cricket to an American or baseball to a non-American.
Here are some of the gory details: The game is played on a field roughly half the size of a soccer pitch with five strategically placed defensemen and one "server." The server stands next to the batter on the endline and tosses a tennis ball straight up with a straight arm for him to hit with a wooden bat.
The hitting team has a six-man batting rotation. The batter has two tries to hit the ball over a 10-meter line, but even if he doesn't, he moves over to the left of the batting circle and becomes a runner.
The ensuing batters try to hit the ball so that the runner - or runners -on the endline can run to the other end of the field and back, earning two points when he returns to his point of departure. But his path is made difficult by the defensemen, who retrieve the ball and try to plunk the runner before he scores. The defense moves to offense when they successfully "tag" a runner and make it back to the endline without being re-tagged.
Batters employ different hitting strategies depending on the situation. If several runners are lined up, the batter will start his swing between his legs and try to hit the ball as high up in the air as possible to give his teammates more time to run. If a defenseman catches the ball in the air, it is worth one point, but it is a small price to pay if runners are able to make it back to the endline for two points. A standard baseball swing is often used for the same purpose, especially for male lapta players, who tend to hit the ball higher and deeper.
If there are no runners, a batter will typically start with the bat above his head and try to smash the ball into the ground to avoid allowing the defense to catch the ball in the air. He will become a runner anyway, so there is no use in risking a point.
Lapta is played by time - two 30-minute halves - and the winner, naturally, is the team with the most points when the official blows the final whistle.
If this is not entirely clear, don't worry. In an informal survey taken on the streets of Belgorod, five out of five people had heard of lapta, while zero out of five said they knew the rules.
Fokin said there are still some kinks that need to be worked out in order to give the game more integrity.
"There is no real punishment for not hitting the ball well," he said. "I would like to see that change, but that's one of the things that makes it such an egalitarian game. Everybody gets to participate until the very end. No one has to return to the bench."
Furthermore, lapta would benefit from creating its own ball rather than using a tennis ball, Fokin said, though care would have to be taken that the size and weight of the new ball would not drastically change the game.
He also noted that a 10-second time limit for pitchers to toss the ball up has been instituted in order to speed up the game and make it more viewer-friendly.
Tuesday's games at the Yunost Children's Summer Camp 10 kilometers outside of Belgorod were certainly that, especially the heated battle between the girls' teams from the Voronezh State Physical Education Institute and the Chekhovsky Mechanical-Technical Institute from the Moscow region.
Both teams were jawing back and forth the entire game, with the Chekhovsky batters talking trash to the Voronezh servers and the Voronezh team complaining that Chekhovsky servers were illegally twisting their wrists on their tosses.
The animosity came to a head when a Chekhovsky runner and a Voronezh defenseman exchanged shoves. The Chekhovsky player offered her middle finger and a barrage of English swear words to her opponent, whose team went on to win 18-16.
Lapta has received official status as a traditional Russian sport from the State Sports Committee, and lapta players certainly take the game seriously.
"It's our game, a Russian game," said Chekhovsky player Tanya Kapustina, 17, when asked what attracted her to lapta. "And it's very exciting."
"Lapta combines elements of all kind of sports," said Sergei Martinchenko, 17, who plays for the Belgorod State Technical University. "Athletics, gymnastics - everything is there."
Many of the tournament's participants expressed interest in other sports, but they made it clear they were not about to betray their favorite.
"Soccer involves only your feet," said 15-year-old Belgorod player Zhenya Bakhturin, "and baseball is just a reworked version of lapta."
TITLE: SPORTS WATCH
TEXT: Belarussian Biker Hurt
BLOOMINGTON, Illinois (AP) - A Belarussian motorcyclist attempting to be the first deaf, non-speaking biker to cross the globe is recovering after a wreck with a tractor-trailer, officials said.
Vladimir Yarets was riding Interstate 74 through McLean County on Oct. 13 when he was struck by a truck's trailer and sent sprawling onto the grass, according to state police.
"At first, we didn't think he was going to survive, but it looks like he's going to be O.K.," State police Lieutenant Ted Kerrn said.
The 62-year-old from Minsk, who has traveled Europe, the Caribbean and most of the United States, broke his pelvis, arm and a leg. His next destination was to be South America.
Yagudin to Turn Pro
MOSCOW (Reuters) - Olympic men's champion Alexei Yagudin is to retire from amateur competition, Russia's figure skating chief said Wednesday.
"We have received a fax from Alexei, where he says that he will no longer compete in the sport as an amateur skater," Valentin Piseyev, president of the Russian Figure Skating Federation, told Reuters.
Yagudin, who won world, Olympic and European titles during the 2001-02 season, has been troubled by a persistent hip injury for more than a year, forcing him to miss most of last season.
The 23-year-old Russian, who has lived in the United States for the last few years, underwent surgery to alleviate the pain in New York in May, but the problem remained.
Piseyev said Yagudin plans to officially announce his decision at a news conference in New York on Saturday.
Yagudin's departure follows a similar move by Olympic pair's champions, compatriots Yelena Berezhnaya and Anton Sikharulidze, who decided to quit the amateur ranks earlier this year.
Russian Set for Le Mans
MOSCOW (Reuters) - Roman Rusinov is hoping to become the second Russian driver, and the first in more than 70 years, to compete in the Le Mans 24-Hour race.
"Le Mans is one of the world's most prestigious races, and to compete in it is a big honor for any race driver," Rusinov, touted as one of Russia's most talented young drivers, said this week.
The driver, who turned 22 last week, is competing in next Sunday's Le Mans 1,000-kilometer endurance race in a Courage.
Boris Ivanovsky, who emigrated to France after the 1917 October Revolution, was the only Russian to compete in the Le Mans 24-Hour race, finishing second overall with Henri Stoffel in 1931.
"Like many other young racers, my ultimate goal is to drive for one of the Formula One teams," Rusinov said.
Pyongyang Worried
BEIJING (Reuters) - North Korea told China its nuclear standoff with the United States was approaching an "unpredictably difficult phase" as Japanese media reported the isolated communist state may be softening its stand on talks.
North Korean parliament chief Kim Yong-nam made the remarks when he met Wu Bangguo, China's parliament leader and second behind President Hu Jintao in the Communist Party hierarchy, on Wednesday, the opening day of a goodwill visit to Pyongyang.
Kim "pointed out that the situation in Northeast Asia centering around the Korean peninsula is reaching an unpredictably difficult phase due to the U.S. invariable hostile policy" toward North Korea, the North's KCNA news agency said.
U.S. Open to Iran Talks
WASHINGTON(AP) - The United States is open to talks with Iran on a limited basis, the Bush administration said Wednesday, while insisting that any improvement in relations would require Tehran to hand over terror suspects.
Even as the administration raised the prospect of a dialogue, the United States said it would be watching to see if Iran complied with a Friday deadline to prove that its nuclear program is peaceful under terms set by the International Atomic Energy Agency.
"Our feeling has been and continues to be that they are not in compliance with their nonproliferation obligations and that, under those circumstances, the matter as a matter of course should be referred to the [United Nations]," said State Department spokesman Richard Boucher.
California in Flames
LOS ANGELES (AFP) - Fires engulfing swathes of California killed two more people Thursday as firefighters battled to save entire towns from the flames that have devastated an area the size of a small U.S. state.
The latest deaths brings to 20 the confirmed death toll from one of the state's worst-ever fire disasters, which officials say was mainly sparked by arsonists.
Nearly 13,000 firefighters were making stands against 17 voracious fires that have scorched more than 2,470 square kilometers of the most populous US state in nine days, officials said.
Solar Flare Hits Earth
LONDON/NEW YORK (Reuters) - A shockwave from the Sun hit the Earth on Wednesday, the final burst from a solar hurricane that has hampered some space satellite transmissions and led electric grid operators to curb power transmissions as a precaution.
Scientists said the cloud of charged particles unleashed at high speeds by a hyperactive Sun and known as a "coronal mass ejection" was traveling at more than 8 million kilometers per hour, taking just 19 hours to arrive from the Sun.
"We expect this storm to continue through the day and tomorrow," said Larry Combs, a space weather forecaster at the National Oceanographic and Atmospheric Administration's Space Environment Center in Boulder, Colorado.
Beatle's Baby Born
LONDON (Reuters) - Ex-Beatle Paul McCartney's wife Heather Mills gave birth to the couple's first child, a baby boy, London's Daily Mirror newspaper reported on Thursday.
The newspaper said McCartney's nephew and a source at the hospital had confirmed the birth. The baby was born a month early, by Caesarian section.
McCartney's representatives were not available for comment.