SOURCE: The St. Petersburg Times DATE: Issue #984 (52), Friday, July 9, 2004 ************************************************************************** TITLE: Friday's 'Svoboda Slova' Expected to Be Last AUTHOR: By Caroline McGregor PUBLISHER: Staff Writer TEXT: MOSCOW - "Svoboda Slova," one of NTV's most popular programs and the only political talk show on Russian television that is broadcast live, will air at 7:35 p.m. Friday in what is widely expected to be its final show. On Thursday, the program's host Savik Shuster confirmed only that it will be the last show of the season. The media community has speculated that he is saving the announcement of his show's fate for Friday's broadcast. Ironically, the show's title can be translated "Freedom of Speech." Vladimir Kulistikov, who was brought in from state channel Rossia and installed Monday as NTV general director, has said he is reviewing programs to determine the fall line-up. The official version is that his discussions with Shuster and "Lichny Vklad" host Alexander Gerasimov, whose show is also seen to be on the chopping block, are continuing. Both shows had planned to break for the summer, but few expect them to reappear when the new season starts in September. The consensus among insider sources is that Gerasimov will leave the channel, but Shuster may be considering an offer to stay on as deputy general director for documentary films, a post that has not existed. It is not clear whether Shuster would consider such an offer from Kulistikov, who worked under him at U.S.-funded Radio Liberty for much of the 1990s. Shuster was Moscow bureau chief and Kulistikov was chief editor. The late-night news program "Strana i Mir" will run through the summer, Alexei Pivovarov, one of its anchors, told Kommersant. The newspaper speculated that if the show, the brainchild of ousted "Namedni" host Leonid Parfyonov, survives into the next season, it may be in a later time slot, at midnight, rather than at 10 p.m. Kulistikov has said his goal is to bring back the viewers the channel has lost since Gazprom-Media took control in 2001 from businessman Vladimir Gusinsky. NTV's management under Kulistikov's predecessor as general director, Nikolai Senkevich, was notoriously bad. But many fear that Kulistikov aims to move the channel away from its trademark emphasis on hard-hitting news toward entertainment. "Svoboda Slova" is one of NTV's most popular shows, pulling in especially high ratings with its political debates during the past election campaign seasons. With high ratings come high advertising revenue. Last Friday's show on "Capitalism, Putin-style," featuring a discussion of corporate responsibility, was NTV's top-rated show last week, according to TNS-Gallup Media data. It came in ahead of other contemporary affairs programs like "K Barieru" and even ahead of the station's films and serials. This Friday, "we'll talk about the bank crisis, we'll talk about the fight against the oligarchs," Shuster said. After Leonid Parfyonov's news magazine program "Namedni" was axed last month, "Svoboda Slova" and "Lichny Vklad" have distinguished NTV, owned by state-controlled Gazprom, from the two state television channels, which are totally under the Kremlin's thumb. Intriguingly, the first to report Shuster's impending departure was the Agency for Political News, or APN, which is linked to Stanislav Belkovsky, a Kremlin-connected political analyst who has advocated stronger state control in society. The APN report cited a source in the presidential administration. Shuster, a Canadian citizen of Lithuanian descent, started hosting a soccer show on NTV in 1998 while maintaining his post at Radio Liberty. He was an outspoken critic of Gazprom-Media's takeover of the station in the spring of 2001 from Vladimir Gusinsky. Nevertheless, he agreed to stay on under the new management team, launching "Svoboda Slova" shortly thereafter. In an interview with The Moscow Times last fall, Shuster seemed to be chafing at the bit somewhat. The station's managers had ordered several of his shows to be run pre-recorded, rather than live, to appease a Kremlin that had accused Shuster of stoking public emotions by bringing relatives of Dubrovka hostage crisis victims onto his show in October 2002. Shuster hinted in the interview that NTV, and Russian television for that matter, were not the only places he could work. The future journalism career of Shuster's colleague Parfyonov also remained open. Parfyonov was sacked last month by former general director Nikolai Senkevich after going public with his bosses' decision to block him from airing an interview with the widow of Chechen separatist leader Zelimkhan Yandarbiyev. In an interview published Tuesday, Senkevich seemed to leave open the possibility that Kulistikov might bring Parfyonov back to NTV, since the two men are friendly. That seemed to corroborate predictions of "Lichny Vklad"'s demise, since the acrimonious relationship between Gerasimov and Parfyonov is well known. Yet, logically, the return of Parfyonov and the cancellation of "Strana i Mir" should also be mutually exclusive, since he created the show. Manana Azlamazyan, the executive director of Internews, an international non-profit organization supporting independent media, said, in any case, the trend at NTV is worrying. "It seems like step-by-step the space for balanced, free, interesting programs on TV is shrinking," she said. "It's bad for viewers and it's bad for NTV's reputation." Yevgeny Kiselyov, who was NTV's editor and hosted its flagship show "Itogi" under Gusinsky's ownership, was less inclined to mince words. "I'm shocked," he said. "It looks like a pogrom.'Svoboda Slova' was the last remaining arena on Russian television for more or less critical debates. We don't have another program like this at all." Viktor Shenderovich, a political commentator on Ekho Moskvy radio who used to host a satirical show on NTV, said he was not shocked. "Nothing here is surprising. Everything was decided three years ago," when Gazprom-Media took control of the station, prompting the departure of a core team of journalists, including Kiselyov and Shenderovich. "Kulistikov is just a pseudonym," said Shenderovich, known for his scathing criticism of the man who worked with him at NTV from 1997 to 2000. "He's not independent. He will do what he's told." Kiselyov said that by the end of the year, it will be hard to differentiate the news on these "independent" stations from the news on state channels Channel One and Rossia, he said. "Television will look like the old Gosteleradio of the Soviet Union, just on different channels." . TITLE: Illarionov Rues Bank Policies AUTHOR: By Denis Maternovsky and Simon Ostrovsky PUBLISHER: Staff Writer TEXT: MOSCOW - The "socialist" policies of the Central Bank provoked the current instability and panic in the banking sector and could topple the whole financial system if left unchecked, President Vladimir Putin's top economic adviser warned Thursday. "All the actions by the Central Bank in recent months could do nothing but lead to a banking crisis," Andrei Illarionov told reporters. "It seems that the word 'crisis' is banned, but we have to call things what they are, and this is a banking crisis." The outspoken economist, known for often contrarian views, said the banking system was fine until the Central Bank started meddling where it didn't belong and flexing its muscles, such as when it revoked the license of second-tier Sodbiznesbank in May, triggering a liquidity squeeze that is still being felt. Illarionov reeled off a laundry list of actions by the Central Bank that he said amounted to "silent socialism," including capital controls, mandatory deposit insurance, reserve requirements and barriers to foreign lending institutions. State-owned Vneshtorgbank's planned acquisition of Guta, which this week became the latest - and biggest - bank to suspend operations since Sodbiznes went down, is a classic example of the "creeping socialization" of the economy, Illarionov said. "These types of crises will end when the socialism in our society ends." Illarionov's comments came as clients of Alfa Bank, Russia's largest private bank, flocked en masse to withdraw their savings for the second day in a row. The Central Bank, which had been roundly criticized for not moving more quickly to quell growing concerns of instability in the banking sector, moved decisively Wednesday to inject liquidity into the system to counter the biggest bank run since the dark days of 1998. By halving mandatory reserve requirements for banks to 3.5 percent, it freed up some 130 billion rubles ($4.5 billion). On Thursday, Prime Minister Mikhail Fradkov lauded the Central Bank for its handling of the crisis, although he said its actions should be more "transparent and consistent." "The Central Bank is solving the issues that have arisen, but we must take into consideration the sensitivity of the sector and its role in the economy," he said. But in a move directly at odds with those advocated by Illarionov, Fradkov said the government would create conditions to "stimulate" the "voluntary mergers" of credit organizations. Analysts took Fradkov's remarks with a grain of salt, saying what the Central Bank does is what really matters. "I don't put a huge amount of importance on Fradkov's statements," said Andrew Keeley of Renaissance Capital. "What is important is what the Central Bank did Wednesday." Also on Wednesday, Central Bank Chairman Sergey Ignatyev, in a speech to parliament, gave Alfa Bank a clean bill of health, reassuring lawmakers, depositors and the business community as a whole that it was too big to fail. Those words were echoed by Alfa owner Mikhail Fridman, who said he would personally guarantee the more than $1 billion Alfa held in personal savings accounts. Such reassurances, however, failed to slow the run on Alfa. Unable to deal with the huge inflow of clients demanding their money back, Alfa tried to stem the tide by exercising its right to charge a 10 percent penalty for early withdrawals from time accounts. It didn't help. Instead, customers simply used Alfa's commission-free ATM machines. By early afternoon, they had been bled dry. "We opened at 8 a.m., but by 10 a.m. all the money had been taken out of our two machines," said Konstantin, a floor manager at an Alfa Express branch in central Moscow. " We've only got euros left now." Konstantin politely asked the increasingly uneasy crowd outside the bank to "please come back in the morning - I am almost sure we'll have cash then." Alfa issued a statement saying the commission was a "temporary measure connected to the panic on the market" - but that only appeared to make matters worse. Yulia Danilova, who was 225th on the waiting list to make a withdrawal at an Alfa branch on Ulitsa Polyanka, said she intended to pull all of her $2,000 out, even if it meant paying a $200 commission. "It is better to get $1,800 than nothing at all," she said. "What are the chances of winning a court case against a bank in this country?" Danilova was just one of several hundred people trying to retrieve their savings from that one Alfa branch. One woman scoffed at a message management had tacked to the door saying all deposits would be honored in full. "Isn't it what they said back in 1998?" said the woman, who declined to give her name. "Even [Former President Boris] Yeltsin promised that there wouldn't be a default." When the panic will end is anyone's guess, but experts are united in the opinion that Alfa's chances of failing are slim to none. Nonetheless, the "crisis of mistrust" that bankers say is responsible for the current malaise - will likely claim dozens, if not hundreds of smaller banks. Adding to the unease was a statement by international ratings agency Moody's that it would review 18 Russian banks, including Alfa, MDM, Bank of Moscow and Russian Standard, for possible downgrades. "The review will focus on the capacity and willingness of Russia's central authorities and of other banking-market participants to provide prompt liquidity support to the solvent banks in need of such aid," Moody's said in a statement. Moody's rivals, Fitch and Standard&Poors, however, both said they saw no reasons yet to review their ratings of Russian banks. S&P said it has already factored the "institutional weakness of the Russian banking sector" into its ratings of 21 banks, while Fitch noted that Alfa's liquidity is "consistent with its ratings." TITLE: Thousands Hail Tikhvin Virgin Return AUTHOR: By Irina Titova PUBLISHER: Staff Writer TEXT: TIKHVIN, Leningrad Oblast - Thousands of believers gathered for the return of the miracle-working Tikhvin Virgin to the Tikhvin Assumption Monastery from the United States on Thursday. The icon arrived in Tikhvin, a town in the Leningrad Oblast 218 kilometers east of St. Petersburg, in a special railway carriage from the city. Women, men and children dressed in festive clothes stood along the route of the procession that took the icon from the railway station to the monastery. Some elderly women knelt and wept with joy near the entrance of the monastery when the icon procession was welcomed inside. Emma Dmitriyenko, 67, said she had come from Belarus to Tikhvin to see the icon. "I hope the icon will help revive the souls of our nation and especially of our children because nowadays millions suffer. Youths are smoking, drinking alcohol, taking drugs. This icon and our faith should help us be safe from all that." Lidiya Brankova, 76, a resident of Tikhvin, said residents of the town were very happy to have the icon returned. "It's such a joy I cannot even express it with my words," she said. "Our hearts are filled with this." Barankova said she hope the icon would help cure her illness and give her strength to raise her grandchildren. All Tikhvin residents also hope that the icon will help protect them from an industrial plant that is being built nearby. They say the ferrochrome plant will damage the ecology of the area. Metropolitan Vladimir of Petersburg and Ladoga thanked the icon's guardian Sergei Garklavs, 75, for the return of the icon. "We are grateful that for 60 years you have been the guardian of the icon at all times and that you decided to return it," he said. "This event will be part of our history." Garklavs, who was paid special honors, said that it was a pleasure for him to see the joy of the Russian people over the icon. "It was a bit sad to have the icon gone, but it's a much bigger joy to see the joy of all the people," he said. David Lucs, Assistant to the Chancellor for Communications and Development of the Orthodox Church in America, or OAC, was one of a delegation of 45 U.S. believers attending the return of the icon. The OAC is "overwhelmed by the gratitude of the Russian people for the return of the icon," Lucs said. Russian Orthodox Patriarch Alexy II held a service in the monastery in the early evening. Herman Archbishop of Washington, Metropolitan of All America and Canada, and primate of the OAC, also took part, speaking some words in English. On Friday, he will sign the official act of passing the icon to the monastery for its permanent care. The icon, taken from Russia during the Second World War, came back to the country by June 26 of 2004, the day when its existence is celebrated. The icon was taken on a special flight from Chicago to Riga, Latvia, where it spent two days. Then it was taken to Moscow to the Cathedral of Christ the Savior. Thousands of believers gathered to see the icon. The icon arrived in St. Petersburg on June 28. Huge lines of people gathered to pay their respects to the icon despite frequent rain and wind. According to legend, St. Luke painted the Tikhvin Virgin icon. But in 1383, 70 years before the fall of the Byzantine Empire, the icon miraculously disappeared from Constantinople. Legend states that angels carried it through the sky and it suddenly appeared over the waters of Lake Ladoga, not far from the Valaam Islands in today's Leningrad Oblast. The icon's reputed miracles are numerous. It is said to have transported itself around the Tikhvin area, hanging in the air and attracting many believers to pray in front of it. Churches were later built at the places it was said to have appeared. On July 9,1383 the icon is said to have appeared above the River Tikhvinka. As they prayed, the icon is said to have descended into the hands of priests. People thought it was a sign from the Virgin Mary that she wanted to have the icon kept at that place, so they started building the church there. However, the next day the icon was found on the other side of the river, and this became what would have been the final resting place for the icon and is today the site of the Tikhvin Virgin Assumption church. The icon was so famous that in 1547 Ivan the Terrible came to pay his respects to the sacred object, and in 1560 he gave permission for the construction of the Tikhvin Assumption male monastery. During World War II, Tikhvin was occupied by German troops for a month. The icon was found in the Assumption Cathedral, where services had ceased under Communist rule, and was taken to Pskov. In 1944, monks took the icon to Riga. They gave the icon to Bishop John Garklavs. After the war in 1949 John fled the return of the Soviets and went to the United States, taking the icon with him. Later he became an archbishop. Archbishop John adopted Sergei Garklavs and asked him in his will to return the icon to the Tikhvin monastery if it reopened. The monastery was revived, so the icon went back home. In the monastery it is to be placed in a specially reinforced case, and guards will protect it. TITLE: IN BRIEF TEXT: New Head of KUGI ST. PETERSBURG (SPT) - Andrei Stepanenko, the former acting director St. Petersburg Property Fund, has been appointed head of the fund, Interfax reported Thursday. Stepanenko had been acting director since May, when former head Lyudmila Kuleshova, went on vacation and was subsequently appointed to work as a judge in the city's Charter Court. Tomchin Re-Elected ST. PETERSBURG (SPT) - Grigory Tomchin was re-elected head of the city branch of the Union of Right Forces, or SPS, at a conference Monday, Interfax reported Tuesday. Tomchin was elected in a second round after the party members have failed to choose their regional leader last week. In-Fill Building Protest ST. PETERSBURG (SPT) - Residents of a building on Manchesterskaya Ulitsa blocked traffic on Kostromskoi Prospekt on Tuesday in a protest over plans for an in-fill construction project, Interfax reported Tuesday quoting Svetlana Gribenshchikova, head of the local initiative group. Twenty-five residents and representatives of the National Bolshevik party went out on the street holding posters declaring "No in-fill construction projects," "Put the trees back," and "Thank you, Valya [Governor Valentina Matviyenko] for in-fill construction projects," Fontanka.ru reported Tuesday Architecture Vacancy ST. PETERSBURG (SPT) - City Hall has 11 candidates vying for the position of chief city architect, Interfax reported Tuesday, quoting Andrei Kibitov, head of the governor's press service. On Friday, the competition commission will decide which candidates will be shortlisted. Burglar Detained ST. PETERSBURG (SPT) - A suspect who allegedly burgled a group of Spanish tourists has been detained, Interfax reported Thursday quoting the St. Petersburg police. On Tuesday night, a burglar broke into a room of a hotel located on Nevsky Prospekt and stole jewelry valued at $10,300, the property of Spanish tourists. Police detained a 22-year-old with the missing jewelry the net day. Bank Staffer Dies ST. PETERSBURG (SPT) - A Sberbank employee who was shot in a street attack on Wednesday has died in hospital, Interfax reported Thursday quoting the police. TITLE: Tikhonov Approved As Vice Governor AUTHOR: By Vladimir Kovalev PUBLISHER: Staff Writer TEXT: The Legislative Assembly on Wednesday approved Valery Tikhonov as St. Petersburg's vice governor responsible for security issues with 39 votes for and one against his candidacy. Tikhonov, a former deputy head of the Federal Guard Service, or FSO, will oversee questions of law and order in the city, cooperating with local and federal branches of the police and Federal Security Service. "It was very hard for the management of the Federal Guard Service to agree that Valery Tikhonov would come to St. Petersburg," Interfax quoted Governor Valentina Matviyenko, who presented Tikhonov to lawmakers, as saying Wednesday. "While I was selecting a candidate I was guided [by a demand] that the person should be a St. Petersburg native and have experience of working in a federal law enforcement structure, because he would have to cooperate with them," she said. This week lawmakers and political analysts suggested Tikhonov, a former KGB officer from Putin's inner circle, had been sent by the Kremlin to monitor Matviyenko's relations with local businesses, such as the fuel and construction market, but the vice governor said he is returning to the city at his own request. "I am here at my own wish," Tikhonov told lawmakers. "I was working in Moscow for 2 1/2 years, including one year, when I was sent to St. Petersburg to work for the committee organizing the 300th anniversary celebrations. I will work indefatigably." But Vladimir Yeryomenko, of the assembly's Mariinskaya faction, queried Matviyenko's explanation of her choice, asking Matviyenko if it was based "on love at first sight" after she first met Tikhonov last year. "I asked how was it that she has known him for just about a year and already knows him pretty well?" he said. Oleg Nilov, a lawmaker in the 300th anniversary faction, asked if Tikhonov could compare the level of preparedness of St. Petersburg and Moscow for terrorist attacks, but the vice governor avoided answering by saying he would "prefer to discuss this issue in a more narrow circle of people." Mikhail Amosov, head of the assembly's Yabloko faction, asked if Tikhonov would use his position as vice governor to advance his career further, as his predecessor "Andrei Chernenko did, who was recently appointed to head the federal migration service." In response, Tikhonov promised he will stay in Matviyenko's office "for a long time." Boris Vishnevsky, a member of the Yabloko faction but not a lawmaker, questioned this. "If he [Tikhonov] is summoned, he will immediately go back to Moscow," he said in a telephone interview. "And, to be honest, I'm fed up with these guys [who describe themselves] as having cold hearts and clean hands that are being sent here from Moscow all the time. "There is no need for a vice governor in Tikhonov's role," he said. "We already have the police and FSB, which are suppose to work without any additional management. The appointment makes the government's structure look like [a Soviet] Communist Party Committee." TITLE: Everyone's a Star at Art Therapy Festival AUTHOR: By Ruth Hetherington PUBLISHER: Special to The St. Petersburg Times TEXT: The 2nd International Art Therapy Festival "Wandering Stars" ended Thursday with a fleet of floating stars - about 300 candles set afloat in the Finnish Gulf in a resort outside St. Petersburg. There was one candle for each participant in the week-long festival. Why was the festival called wandering stars? "Because all the children are stars and, like everyone else, to find their potential they have to look around and search a bit," said Kovcheg director Alexandra Lenartovich. The festival, which took place from July 1 to 8 in the leafy surroundings of the Vostok-6 health resort, 80 kilometers north of St. Petersburg, was established by the integrated school Kovcheg, or The Ark, in Moscow. The festival is a continuation of Kovcheg's four-year collaboration with the French theater troupe Turbulences, who work with autistic and Down Syndrome children and young adults in Paris. Traditionally in Russia disabled children are educated separately. Kovcheg advocates integrated education that closely involves parents and places artistic expression and creativity at the heart of the educational process. The festival, a fundamental part of their integration program, brings together children, their parents and educators from Russia and abroad, and allows them to exchange their ideas and experiences of integrated education. This year there were representatives from several Russian regions who regard Kovcheg as a model of education they would like to translate to their own localities. "The most important thing for us is to listen and learn from other people's experiences," said Kaleriya Pronina, chief educational specialist with the Magadan Region Administration. The strong international focus was also evident, with a school from Duesseldorf, Germany, and a day hospital for autistic young adults from Paris taking part. No need to worry about communication problems, Maria Smirnovna, a former Kovcheg pupil who now teaches in the school, said, " they don't all speak the same language but they have found another one." Listening to the haunting a capella folk songs of the French contingent, the rousing samba beats produced by a Russian-French ensemble, the giggles provoked by the German comedy performance and, above all, the happy chattering and laughter during the final concert and procession along the beach, it is easy to see which language that is. Kovcheg, or The Ark, was founded in 1990 and has just over 500 students, many of whom have developmental problem or disabilities, such as autism or Down Syndrome. The festival was held in cooperation with the Assistance to Russian Orphans Program and the American Jewish Joint Distribution Committee, which have recently branched out to work with children's charities. TITLE: Former LDPR Deputy Said Behind Starovoitova Slaying AUTHOR: By Vladimir Kovalev PUBLISHER: Staff Writer TEXT: A defendant on trial for the 1998 murder of liberal State Duma Deputy Galina Starovoitova has testified that the killing was ordered by former Duma Deputy Mikhail Glushchenko, RIA-Novosti reported. The whereabouts of Glushchenko, a reputed St. Petersburg crime boss who served in parliament as a member of the ultranationalist Liberal Democrat Party, or LDPR, are unknown. He is thought to be living abroad. Leonid Saikin, a representative of Starovoitova's relatives, said the defendant told the St. Petersburg court on Wednesday that Glushchenko had ordered that Starovoitova's telephone be tapped, RIA-Novosti reported. Saikin did not say which defendant had testified about Glushchenko. Yury Kolchin, one of the six defendants on trial in the murder, passed the order to Sergei Musin, who is being sought by police, Saikin said. Musin is suspected of selecting the attic of a building facing Starovoitova's apartment block at 91 Naberezhnaya Kanal Griboyedova for the sniper to hide, RIA-Novosti said. One witness in the trial testified Wednesday that he believed that Glushchenko and Starovoitova had had a falling out. "I thought something had happened between Glushchenko and Starovoitova and they wanted to put pressure on her," the unidentified witness said, Interfax reported. Glushchenko, referred to in the media by his nickname Khohol, a derogative name for Ukrainians, is thought to be a leader of the Tambov crime group. Earlier this year, Ruslan Linkov, Starovoitova's assistant who was injured in the 1998 shooting, named Glushchenko as one of those who might have ordered the assassination. Starovoitova saw Glushchenko just once in 1997, when he attended a meeting between then-St. Petersburg Governor Vladimir Yakovlev and Duma deputies, Linkov said. "Although he was elected, he never showed up at the Duma," Linkov said. Linkov in March suggested that former LDPR Deputy Vyacheslav Shevchenko was linked to the assassination. Shevchenko's body was found wrapped in a plastic bag in a villa in Cyprus that month. Alexei Voronin, one of the suspects on trial, testified Monday that about $10,000 was spent organizing the murder. He said he believed the money was Kolchin's. TITLE: Family Slayings 'Not Related' PUBLISHER: The St. Petersburg Times TEXT: The murders of two families in the city this week are unlikely to be connected, Deputy City Prosecutor Alexander Zhukov said Tuesday. The two crimes were absolutely different, and there were no indications they were connected, he said at a news conference. The bodies of the members of both families were found murdered in their apartments Monday. In the first case, three Petrovs, a father, mother, and teenage daughter were found dead in the Kirovsky district. A fourth man was yet not identified, Interfax reported. The weapon used to kill all four was probably an axe, Zhukov said. In the second case a family of Pankovs, including a father, a mother, and a 15-year-old son were killed in their apartment in Krasnogvardeisky district. The murder weapon in their case was most likely a knife. In the Petrovs' case, the family had no permanent income and were not rich. In the Pankovs' case, the family was wealthy but they also didn't have permanent jobs. Prosecutors opened a criminal case of multiple murder. However, they said that the case could later be changed to one of robbery since the murdered family was wealthy. TITLE: Tensions Rise in South Ossetia PUBLISHER: Interfax TEXT: TBILISI - The tension in South Ossetia is becoming increasingly worse, Georgian Prime Minister Zurab Zhvania told foreign ambassadors in Tbilisi on Thursday. "Our post between the villages of Tamarasheni and Kurta in South Ossetia has been attacked," he said. "We are closely watching the developments and doing our best to prevent an armed clash." Zhvania said he would speak to Russian Security Council Secretary Igor Ivanov about the situation in South Ossetian by telephone immediately following his meeting with the ambassadors. South Ossetia has denied that Ossetian units attacked a Georgian post. "This is sheer misinformation. Not a single Ossetian unit has conducted any operations in that area. The search for illegal Georgian units to expel them from the district is underway in a different area," head of the South Ossetian Information and Press Committee Irina Gagloyeva said Thursday. TITLE: Economy Faces OECD Criticism AUTHOR: By Maria Levitov PUBLISHER: Staff Writer TEXT: MOSCOW - The Organization for Economic Cooperation and Development on Wednesday jumped on the bandwagon of international institutions urging Russia to do more to diversify its economy. Continued over-reliance on oil and gas exports and a failure to establish a system to protect property rights could soon turn Russia into a giant banana republic, the Paris-based group of 30 rich nations said in its annual report on the Russian economy. "There is a risk of distorted development associated with over-reliance on the natural resources sector," said Andrew Dean, one of the authors of the 300-page report. Dean said Russia, like many Latin American countries, is in danger of becoming a boom-and-bust economy. The true scope of the problem is difficult to ascertain, however, because the government's statisticians base their findings on distorted data, the OECD said. "Official statistics, though technically correct, present a somewhat distorted picture of the Russian economy," OECD said in the report. For example, according to the Federal Statistics Service, formerly known as Goskomstat, the oil and gas sector accounts for just 10 percent of gross domestic product, even though it accounts for 50 percent of all exports. The OECD did not give a precise estimate of how much of the economy comes from hydrocarbons, but it backed the 20 percent figure most economists have come up with. Official statistics are misleading, the OECD said, because they do not include the trading arms and other subsidiaries of oil and gas companies. "We understand the logic behind [the criticism]," the deputy head of the FSA, Igor Ulyanov, said at the presentation of the report. "But logic is logic and numbers are numbers." The OECD also urged Russia to continue the disciplined fiscal regime it has adhered to over the past few years. "Given Russia's vulnerability to commodity-price cycles, it is difficult to exaggerate the importance of continued fiscal discipline," the OECD said, adding that the same goes for the newly created stabilization fund. By law the first 500 billion rubles ($17.2 billion) of the rainy day piggy bank cannot be touched unless oil prices unexpectedly collapse. Ideas on how to spend the excess are already being debated, even though the fund is not expected to pass the 500 billion ruble threshold until mid-2005. The fund surplus should be used only for early debt repayments and funding the pension system, the OECD said. "Fiscal irresponsibility can contribute to the boom-and-bust cycle," it said. Echoing the concerns of the International Monetary Fund, the OECD also found inherent contradictions in Russia's dual monetary goals of reducing inflation while limiting ruble appreciation. Nonetheless, the overall economic reform effort, with the exception of Gazprom, is "impressive," the OECD said. "The [gas] sector, whose reform has been repeatedly postponed, is in stark contrast to the electricity sector." Tipping its hat to Unified Energy Systems CEO Anatoly Chubais, the OECD said the reform plan for the electricity sector "is thorough and well thought-out." The report did point out that UES reform "risks being subverted by special-interest groups," but even that is being reconsidered by the government. Prime Minister Mikhail Fradkov last month called a halt to the plan until the new government can review exactly who stands to gain from what. But the report is more concerned with gas, warning that "the gas sector will be unable to sustain sufficient output growth to meet rising export commitments and domestic demand." Gas monopoly Gazprom is essentially "an arm of the state," which controls the infrastructure and information flows within the sector, the report said. While the report focused on structural reforms, it called property rights the basis for economic growth. "Arbitrary exercise of state power remains one of the main threats to the security of property rights in Russia," it said, citing the Yukos case as an example. Although the economy is likely to keep growing - provided the government continues structural reforms and adheres to a prudent macroeconomic policy - the 6.7 percent average growth in 1999-2003 has not translated into improvements in social indicators, such as higher life expectancy, the OECD said. As a result, the organization plans to examine Russia's social services sector in more detail. TITLE: Wireless 'Hot-Spots' to Invade Public Places AUTHOR: By Svetlana Skibinsky PUBLISHER: Staff Writer TEXT: Trendy city cafes and restaurants have been warned that they should install wireless Internet technology or fall behind, as the technology is expected to invade the city's public access spots by the end of the year. City Internet provider Quantum, wireless equipment provider D-Link, and systems integration company Reksoft conducted a presentation of the wireless Internet or Wi-Fi services Wednesday, aiming to increase the number of Wi-Fi hot-spots in the city. The hot-spots are areas with Internet coverage that allow users to access the Internet from their own laptop computers by simply pressing the button. Organizers suggested selling a login-and-password combo at the hot-spot in order to keep the services commercially successful. "Wireless Internet access is already omnipresent in the West," said Gleb Grigorovich, a Reksoft representative, speaking at the presentation. "Soon, having hot-spot areas at hotels or other public places will no longer be an attraction but a necessity," he said. "[Trendy] cafes and restaurants have about a half of the year to use 'hot-spots' as a marketing tool for 'growing' regular clients before they will simply have to get it in order to stay competitive." According to a report prepared in May by J'son & Partners Consulting on the Wi-Fi industry in Russia, there is expected a 225 percent growth in the number of hot-spots, from 43,000 in 2003 to over 140,000 by the end of 2004. The survey says that during the last year, Europe and Asia took a more aggressive position toward the global Wi-Fi market and now host over 82,000 or 75percent of all the hot-spots in the world. Hot-spots first appeared in St. Petersburg in 2003, and now the city has 31 location, superseded by Moscow with 47. Other regional centers such as Novosibirsk, Nizhny Novgorod and Samara are also beginning to provide hot-spots in hotels and airports, the survey said. Whereas about 60 percent of all Wi-Fi users in the country are students, the business users segment brings 70 percent of all the profits for Wi-Fi providers. Cafes and restaurants attract young professionals, who often become regular clients of the place, while one-third of all hot-spot areas are offered to businessmen in hotels and airports. Russian users can get Wi-Fi access at $6 to $10 per hour. Service is offered by local and national operators, such as Quantum, Peterstar, even MegaFon. The telecommunications giants Golden Telecom and Vimpelcom are planning to expand the service in 2004-2005, the J'son & Partners report said. However, few of the city cafes and restaurants catering to the Wi-Fi audience sent representatives to Wednesday's presentation. "Maybe they are not ready for it yet," said Quantum's PR director Julia Khusainova. A representative of a casino chain and the owners of Western Paris and Parnas, two city restaurants sporting 19th century décor and gypsy performances, said they were considering buying the hot-spot service. TITLE: Citibank Opens to Consumers AUTHOR: By Simone Kozuharov PUBLISHER: Staff Writer TEXT: Nearly two years after opening its first consumer banking branch in Moscow, Citibank is now open for business in St. Petersburg, Citibank officials announced at a press conference Tuesday. "Life is going to change in St. Petersburg," said Nandan Mer, head of Citibank's consumer banking division in Russia. "From today every single telephone in St. Petersburg is a bank branch." St. Petersburg customers will be able to do their banking by telephone, on-line, at one of the nine ATMs around the city or at the bank's single St. Petersburg branch on Moskovsky Prospekt. Citibank plans to have 40 fully operational ATMs in the city by the end of this year. The bank has also secured strategic alliances with gas stations Neste and Shell to open self-service branches at their outlets. In addition, 4 Lenta superstores will house Citibank ATMs, said Ludmila Botsan, Citibank's public relations manager. The bank also plans to open a sales center at a fifth Lenta location, where customers can apply for loans, but the bank was unable to confirm a date. Jean-Paul Votron, CEO of Citigroup International for Europe, the Middle East and Africa, said that coming to St. Petersburg was the next logical step after Citibank's "quite remarkable" success in Moscow. Votron recalled driving through Moscow with Citibank Russia President Allan Hirst and remarking on the various advertisements on the city's buildings. "I really would love to see Citibank on top of one of these buildings," he said he told Hirst. Citibank's corporate and consumer divisions in Moscow have about 200 and 400 employees, respectively. There are 70 ATMs in the city and the bank projects a total of 17 branches there by the end of the year. Just one of Citibank's Moscow employees has headed north to run the St. Petersburg satellite, while the approximately 80 new employees here are local hires. Likewise, Citibank officials made it clear that they are here to serve the local citizens. "We're not going after the expats," Votron said. "If you cannot be a strong local player, you are not in business." Citibank officials stressed that the bank intends on serving everyone, from students to pensioners to business people. "We're here to serve the Russian consumers," Mer said, adding that the expat community is no less important to the bank. Although Citibank is an American corporation, the vast majority of its customers in Russia are Russians and expats make up only a "very tiny percentage," Votron said. Which means Citibank is not intimidated by its competitor Raiffeisen Bank's already established presence in the city, Votron said. "If we didn't have competitors we would be very sad," Votron said. "I welcome competition." Roger Delous, Raiffeisen's general manager for North-West Russia agreed. "It's normal competition," he said in a telephone interview last month. "I think we are going to see more of it." TITLE: Hermitage Goes Mobile PUBLISHER: The St. Petersburg Times TEXT: The State Hermitage Museum plans to sell images of its masterpieces to mobile phone users who want to display the pictures on their handset screens, Interfax reported Wednesday. The list of masterpieces that can be used by mobile phones users is long, "from Scythian gold to classics," Hermitage director Mikhail Piotrovsky was quoted as saying. Downloads of single images will cost $1, while images with accompanying texts will go for $2.5, the agency quoted a project organizer as saying. Aside from generating revenues, Piotrovsky said the goal was to refine the art tastes of young people and make the museum's collection "more accessible." The head of the ethno psychology department of Moscow State University, Alexei Nagovitsin, told Interfax "one must not be afraid of new ways of spreading culture - telephones, computer games. "The state and culture itself will only gain by this project," Nagovitsin said. "We must make culture fashionable and then the youth will reach out for it." TITLE: IN BRIEF TEXT: Double the Hotels ST. PETERSBURG (SPT) - The amount of hotel rooms in the city will double by 2010, said administration officials after a strategy development meeting on Tuesday, Interfax reported. The city has about 7 hotel rooms per every thousand citizens, said Maxim Sokolov, the head of the investment and strategic projects committee. In Moscow the number is about 30 percent higher, he said. "However there has been a positive growth tendency during the first half of 2004 with 5 new hotels beginning operations," Sokolov said. The city hotel developments strategy includes opening hotels at over 100 new locations. Governor Valenitna Matviyenko said that 6 of these locations will be ready for sale in 2004. "By 2010 we have to reach the average European level. We need not only large hotels, but targeted hostels for youth, tourists and handicapped people," she said. Matviyenko also directed the investment and strategic projects committee to begin talks with large hotel operators about building new hotel complexes in the city. She said however that the tenders for location sales will be closed to the general public. KIA Sales Grow ST. PETERSBURG (SPT) - South Korean auto-maker KIA Motors more than doubled its Russian dealer sales in the first half of 2004, Interfax reported. There were 10,381 cars sold in the Jan.-June period this year compared to 4,751 units last year, company representatives said. The figures include both the imported cars and the ones produced domestically at JSC Avtotor. Uncertified Ads ST. PETERSBURG (SPT) - The City Hall will be making monthly checks to root out unauthorized advertisements on city streets, said the director of the city's center for advertisement placement (CCAP), Alexander Kadirov in a statement to Interfax. Starting June 25, the CCAP started covering the unauthorized advertisements with stickers that say "Uncertified Advertisement." The sticker also carries a phone number for registering the advertisement. "If the ad is not registered in a month, the stand will be taken away, and its owners will be held responsible for breaking the law," Kadirov said. The City Hall hopes this measure will help to bring the funds the city was losing on the unauthorized ads during the last few years as the advertisement presence on the city streets grew. Vacant City Land ST. PETERSBURG (SPT) - A total of 330 vacant land plots were registered in the city historical center during the city administration meeting Tuesday, Interfax reports. The land plots that average 1200 square meters can be sold for new construction, the city construction and architecture committee says. 109 plots were registered on the Petrograd side, 97 in the historic center, 61 in the Admiralteisky district, 44 on the Vassileostrovsky district, and a few in other city districts. It took the city 5 months to compile the locations list, Interfax reported. TITLE: Putin in Gorki AUTHOR: By Andrei Piontkovsky TEXT: When Lenin, ailing and paralyzed, was confined to the Gorki residence, his comrades from the party printed a single special issue of Pravda for him every day. In mercilessly principled Bolshevik style, they told of the party's incredible achievements in building up the economy and of the ever-growing unity among its leadership, headed by comrades Trotsky and Stalin. Nonetheless, faint doubts lingered in Lenin's fading mind and one day, during a brief remission, he ordered a car and forced the chekists assigned to him to drive him to his Kremlin office, where he read over some paperwork. After that, his health took an ultimate turn for the worst. The special issue of Pravda continued to come out for a while, but Lenin no longer read it; he just whimpered quietly and kept asking Comrade Stalin for a bit of poison. The Kremlin's current ruler, who is the same age now as Lenin was in 1922, does not read Pravda. But he does watch the single television channel tailor-made specially for him and broadcast all along the dial. There, Putin-Jugend boys in metal-rimmed glasses utter his name in an erotic singsong, and tell viewers of the grateful Chechens who adorn their rebuilt homes with hand-embroidered portraits of Putin and the starving pensioners in the countryside who ardently support the government's long-overdue efforts to get rid of the unfair public transportation perks of the city pensioners. But one day Putin ordered a helicopter and forced the chekists assigned to him to fly over Grozny. A few days later, he excitedly shared his impressions from the trip, which had left him horrified. Unlike Vladimir Ilyich Lenin, Vladimir Vladimirovich Putin did not organize a revolution or seize power in the country. He was appointed to his high post by a group of esteemed comrades (B. Berezovsky, R. Abramovich, B. Yeltsin, A. Voloshin, T. Dyachenko et al.) who took on all the thankless organizational work themselves. As a result, the leader of the Russian bourgeoisie is much healthier than was the leader of the world's proletariat: Putin did not break down after his first venture from virtuality into the real world. On the contrary, he persists in his bold partisan forays, as if saying, "I have to see for myself and determine how events really unfolded." And after seeing for himself, he adds, "Things, of course, were different than what I had been told beforehand in Moscow." But why the "of course"? Whence Putin's despondent fatalism? Could it be because Putin himself has spent four years busy as a bee - while personally delving into all the details of fateful business disputes - zealously protecting all alternative media outlets, all alternative political institutions and all alternative points of view? A man who finds himself at the very top of an administrative totem pole standing alone in a scorched political wasteland automatically becomes the prime victim, left naked among the wolves, in a system where there is one newspaper or one channel. And no ratings or ruling parties can save him. Because all those ratings and parties come out of the same dirty tube. Recall Yevgeny Primakov's ratings five years ago. Recall the accolades sung him by the bureaucrats who later made up the core of the United Russia party: the mighty elder, father of Russian statecraft, economist, diplomat, intelligence officer, Our One and Only. But then suddenly The Channel starts showing Berezovsky's hired journalist Dorenko who crushes a couple of Primakov's joints, and that whole crowd that had been running after Primakov, dusting off his shoes and hoping for Cabinet posts, yells out in unison: "Oh, no, are you kidding? He's not Our One and Only. What were we thinking? It's that other guy, the one who said to kill in the outhouse, he's Our One and Only!" And they're yelling to this day. What would happen if tomorrow night The Channel showed some ape-man in a striped sailor's jersey claiming to be our true One and Only, while explaining that the former Mr. One and Only let the Americans set up military bases in Central Asia, allowed NATO bombers with nuclear missiles to come within a 10-minute flight of Moscow and sold out Russia's historical ally Aslan Abashidze? This would diminish neither the rating of Our One and Only nor the extent of his adoration by the political elite. But the One and Only in question would be a different person. Because the president's 70 percent popularity rating does not belong to an individual called Vladimir Vladimirovich Putin; it belongs to a limited-liability corporation called Our One and Only - appointed by The Channel. Andrei Piontkovsky, an independent political analyst, contributed this comment to The St. Petersburg Times. TITLE: Yukos: The Endgame and The Economy PUBLISHER: Financial Times TEXT: Russian president Vladimir Putin must decide soon how he wants to end the Yukos affair - or risk causing real damage to Russia's economy. Recent raids on the oil group by court bailiffs pursuing a 99 billion ruble ($3.4 billion) tax claim have, says Yukos, brought the company to the brink of financial failure. Yukos has been told it faces a further 98 billion ruble claim, with every sign of more demands to come. Meanwhile, Mikhail Khodorkovsky, founder of Yukos, and Platon Lebedev, his partner, face fraud charges in a trial that could take months. Putin has indicated that he does not want Yukos to go bankrupt. But he has not said what he does want. Presumably, Kremlin officials are arguing over the best course of action, to some extent reacting to events in a drama that has now lasted a year since Lebedev's arrest on July 2, 2003. The Kremlin has accumulated a mass of evidence in support of its case against Khodorkovksy - that he used questionable means in acquiring state-owned assets and later maximised profits by aggressive tax planning. However, Khodorkovsky was not alone among the business oligarchs in bending the rules. Putin has not dispelled the impression that he targeted Khodorkovsky because of the Yukos founder's political ambitions. The judicial attack on him and Yukos is therefore unfair. A fair way of curbing the oligarchs would have been to impose heavy taxes across the board. But, given the path chosen by Putin, what should he do now? First, he must recognize that further delays in resolving the Yukos case will cast uncertainty across the economy. It is true that investor interest in Russia remains strong, despite Yukos. But that is mainly because of growth fuelled by high oil prices, which may not last. The courts must make the investment rules by completing their work as soon as possible. Next, the apparent attempt to drive Yukos into bankruptcy should stop. Bankruptcy would prompt a rush of lawsuits involving the government and different classes of creditor. This is not in the interests of the company or of the taxman, who would, like everybody else, have to wait a long time for his money. The company has offered to pay its tax bills - for example by transferring to the government its $4.7 billion stake in the Sibneft oil company. If the authorities do not want the shares, they can give Yukos more time to raise cash by selling assets - and impose interest charges in the event of delays. This would not be weakness, but common sense. Perhaps the Kremlin's real motive is to split Khodorkovsky from his money. By breaking Yukos the authorities can destroy most of his wealth. But he could be rendered penniless without crushing the company - by imposing huge fines on the man himself and, assuming he cannot pay, seizing his Yukos shares in lieu of cash. That would be ugly, but it would be less damaging to the Russian economy. This comment appeared as an editorial in the
Financial Times.
TITLE: Detergent Ads Cold Comfort for Citizens AUTHOR: By Vladimir Kovalev TEXT: The city's communal housing service has started a new business. While doing nothing to provide citizens with hot water in the summer, the responsible officials have found the time and resources to earn some money through advertising. "Dear Citizens, we apologize that the hot water is going to be switched off from June 1 till June 21, 2004 ... Don't forget that the problem of dirty dishes can be easily solved with a help of Fairy, it is a well known fact that it easily gets rid of fat and dirt, even in ice-cold water," say information leaflets placed all around the city on the doors of residential buildings in the city's central district. The leaflets are signed "housing committee No. 3." It might have been simply a joke, but many of these leaflets are printed in color, which is quite a clear sign that the authorities received money for the ad, and probably not small money. It is common knowledge that there is a huge difference between the operations of the communal housing services and that of a commercial business, but the ad appears to show that the services do understand something about money. Russians learned how to make money out of nothing in the first few years after the collapse of the Soviet Union and those experiences have become part of people's nature. The leaflets are a clear sign that people can not only still do it, but they have even perfected their abilities to make money out of thin air. An official at City Hall's energy supply committee, who, I thought, would have had a clue about who had the brilliant idea to advertise such a priceless product when there is no hot water, laughed like crazy when I read him the text of the leaflet. I got the same reaction from Soyuz Quadro, the distributor of Fairy in St. Petersburg. "That must be some kind of up-to-date housing committee," said Mikhail Simonovsky, the company's spokesman. Both the official and Simonovsky said they knew nothing about the advertisement. "This is interesting ... we didn't do it, but we won't run any investigation into this matter," Simonovsky said. "However, it would be interesting for us to find out more if you going to look into it." Housing committee No. 3 turned out to be far from being up to date. When I called there, a middle-aged woman screamed something at me (I couldn't even understand exactly what it was that she screamed, but it was definitely negative) and hung up. The St. Petersburg branch of Procter & Gamble, which makes Fairy dishwashing liquid, suggested I ask their Moscow office about housing committee No. 3. I had entered a vicious circle. Later I thought I could have presented a great moneymaking idea to Soyuz Quadro and Procter & Gamble. They shouldn't miss the opportunity at a time when most of the city's residents are washing themselves, just like birds do, by splashing their bodies with water heated up on their gas stoves every summer morning. This is the perfect time to increase sales of dishwashing liquids in the city and to get a great result from promoting new products. There is an enormous amount an advertisement space in the city. On Bolshaya Morskaya Ulitsa, for instance, notices regarding the switching off of hot water switched are written by hand with blue ink. It looks as if not all the housing committees in the city have computers and photocopying machines. Of course, it is quite cruel and at the same time funny to read advertisements in conditions when people don't have any choice but Fairy. Business is business and emotions should be put aside. I have a few questions for the authorities from City Hall and the communal housing services committees. The questions are: "How much?" "Who got the money?" and "How was it spent?" If the committees were not owned by the city, but were privatized, I wouldn't have had to ask the questions. I wouldn't have written about it either. I would have just laughed and forgot it. TITLE: musical experiments in stereo AUTHOR: By Sergey Chernov TEXT: Since their Moscow gig four years ago, Stereolab, one of the U.K.'s most original and innovative bands will bring its blend of lo-fi, lounge and electronica to St. Petersburg. Backed by the British Council, Stereolab will come to St. Petersburg for a one-off concert and plan to spend five days in the city. The band, which suffered a tragic loss when the guitarist and second vocalist Mary Hansen was killed in a bicycle accident in London in February 2002, has since gone through some lineup changes. "We have a half-different lineup, so this adds quite a different sound," said guitarist Tim Gane, speaking by phone from his London home. "I mean, it's still a Stereolab sound, the heart of it stays the same but in the kind of instrumentation that we have and the kind of textures that we can do live, it's a bit more involved than before. Basically, there's more things than before. It's not sort of simplified, it's not sort of as reduced as before." Gane admitted that the set-list will not be much different to that of Stereolab's recent world promotion tour of most recent album "Margerine Eclipse," although the band will try to perform as many songs, both old and new, as it can. "I don't want to play only the new record," said Gane. "We concentrate mainly on the new record first. And then we begin to add what we have time for at the end - sort of older songs to throw in around it. But I mean, obviously, for the band it's more exciting, of course, to play newer material. Especially for Stereolab, because the songs at the end of the tour, the new ones, are very very different than those of the beginning. At the beginning of the tour they sound more like on the record, but towards the end of the tour they've gone through drastic changes. "And some songs get dropped because they don't develop, and some songs develop into something totally different from what was on the LP. Whatever song we decide to do, it is only the starting point, really. "And the old songs, they ought to be played sort of classically, the way they were recorded. But of course we got a different lineup, different instruments, so even the old songs sound different now. So, it will be quite a different show, quite a different performance to the one we did in Moscow four years ago." Released in February, "Margerine Eclipse" is the band's first album since the 1991 "Sound-Dust." "The last LP was an odd LP for me," said Gane. "It was the very first album in a long time that had no kind of concept sound at all. I purposely wanted to write a record that was just a collection of songs. And I did it for the reason that, we were building our own studio in France at the time, or we were about to do it. I wanted to do just a collection of songs which would be quite simple to record, because I felt that the studio would be quite primitive, and not what we had been used to, I suppose, going to Chicago, with John McIntyre, etc. "So the idea was to write a quite simple, direct set of songs, which could be played kind of live. In the end, it was like seven months before we actually started recording. In the meantime, many things had happened, and by the time we got to record, basically, I wasn't interested in the idea of playing the set of the songs live or anything like that, and I didn't know what to do about it. In the end what we decided to do was one arrangement of the music on one speaker and a totally separate, different arrangement of the same songs on the other speaker. So the LP sounds a little different in the way that we recorded it, more than in the way that I originally wrote the music." Always experimenting, Gane said he invented this technique just a few days before the band went to the studio. "This idea just occurred to me literally three days before we started recording. I didn't know what to do but the idea came from the set. Because we were going to do it live, but we didn't want to do it live anymore. So, I thought what we can do, is maybe record one speaker live, and then with the other speaker we could just do an arrangements, with electronics, work on some parts with Sean O'Hagen, for instance. So we would have two versions. "It quickly became apparent that it was much more interesting to do totally different arrangements, not to try to make one live and one acoustic, or one electronic and one acoustic, whatever, and just see what developed. And I think it was quite interesting and exciting for us, because it meant that we had to come up with a lot of obstacles and things that we hadn't previously come across. And the one thing that was good was making, coming up with new things to do, which, I think, is always good in music." While the band's French singer, Laetitia Sadier, is responsible for lyrics, the main man behind Stereolab's music is Gane, though he avoids describing himself as a "songwriter." "I'm not a songwriter, I'm not a composer," he said. "I tend to assemble our music more in a sense of a lot of montage in film or collage in art. It's more of an assemblance of different parts, and what interests me is how they go together, the juxtaposition of all sorts of elements. This is a kind of constant thing were've gone through from beginning to now as a group. That's because my idea of music is more artistic. I'm not interested in achieving a specific goal with what we do, I'm interested in seeing what happens when you set up a specific situation or scenario that allows elements to come by. So, for me this is why I'm doing it. So, at the end of this all there is not only one element in doing the music - the actual participation is equally as important for me. I never try to sort of predict the way it will turn out in the end. So this is why it is always funny, when people say, "Oh, this record is a lot more commercial than previous ones" or "This one is more uncommercial". And in the end it is irrelevant for me, because I don't design a record to be more or less commercial, more or less uncommercial, or more pop or less pop, or more jazz or less jazz - it's just the elements that seem to appear intuitively in recording that come to the front. "You see, a lot of people listen to music in a way that I would call surface-like, subjectively, and I'm more interested in the content of music. And the content I think is quite dense and strong in Stereolab. The way we decided to do arrangements changes a lot, all the time. So, I think the music changes and it stays constant at the same time. It's sort of like a human being, I suppose." Stereolab perform at the Theater of Young Spectators (TYuZ) on July 16, at 7 p.m. Links: www.stereolab.co.uk TITLE: dance festival ends in gala show AUTHOR: By Angelina Davydova PUBLISHER: Special to The St. Petersburg Times TEXT: International Dance Festival Open Look, which started in St. Petersburg on July 1, has its gala performance on Saturday with most festival participants presenting joint projects. During the ten festival days dance companies, theaters and choreographers from the U.S., U.K., Sweden, Switzerland, France, the Netherlands and Spain, along with their Russian counterparts have been demonstrating the latest trends and discovering new names in modern dance, jazz dance and contact improvisation, giving an insight into contemporary choreography to the St. Petersburg audience. This year's event is the sixth annual summer festival, organized by the Kannon Dance company and school, with the support of U.S. General Consulate, General Consulate of Sweden in St. Petersburg, the British Council, and several other public and private funds and cultural organizations. Vadim Kasparov, the festival's director, said at a press-conference last Wednesday, that the main task of the "Open Look" is to integrate different cultural directions in contemporary dance, to develop dance and make it popular as part of contemporary culture while developing it as a universal language. Contemporary dance has been less popular than other forms of modern art in Russia because of the dominance of classical ballet, especially in St. Petersburg, the home town of Russia's leading ballet theatres and companies. Still, it is contemporary dance that appears to be closer in an immediate and direct way to the modern viewer in terms of addressing, involving, interacting and educating the audience. For example, one of the projects in the festival is Risa Jaroslow & Dancers, who in cooperation with Kannon Dance showed the performance "Becoming Whole". Risa Jaroslow's performances employ older people and people with disabilities. Risa Jaroslow says that working with handicapped people was her choice, and that this festival's performance also "explores the questions: what makes you an individual or what makes a community feel as a whole?" On July 2 there was the chance to catch one of the festival's finest performances, "The Rite of Spring" by chamber ballet "Moskva"directed by a French director Regis Obadia, winner of Russia's top theatrical award, the Golden Mask, in 2004. On July 4 a joint Russian-Swedish project "Adam and Adam" presented their version of relationships of two men, seen through the eyes and bodies of modern people failing to communicate with each other. On Friday the festival showing will include two performances - one by a Swiss theatre and dance company Drift and another one by an American project, Bill Young&Dancers. Saturday will see a gala performance with most of the festival projects taking part in new joint programs. TITLE: chernov's choice TEXT: The opening of Stereoleto festival left many a smiling face through its music and atmosphere, but there was a certain disappointment also when Asian Dub Foundation, which was presented on posters and publicity photos as an eight-man band, appeared onstage as a trio, consisting of a DJ and two MCs. However, the small print in the festival's advertising did read: "Sound System DJ Set." This week's Stereoleto night promises a live concert by U.K. band The Orb, who have been lauded as the inventors of ambient house, French electronica duo Chateau Flight, producer and composer Andrei Samsonov's band Laska Omnia and perhaps Russia's oldest electronic band - New Composers. Due to the problems with its usual location, Molodyozhny Theater and its gardens, the festival will move for one night to the rather distant site of the Central River Yakht Club on Petrovskaya Kosa. The festival's remaining two events will take place elsewhere. Korabl, the Moscow band of artists and architects who seem to be proud of being incapable of playing their musical instruments also boast that they started using swear words in their lyrics even before Leningrad's famously foul-mouthed frontman Sergei Shnurov did. "Korabl is an artistic project, not a musical one," explains the band's guitarist Ilya Voznesensky. Another link to Shnurov is Leningrad's song "Zvezda Rok-n-Rolla" (Rock and Roll Star), the lyrics of which seem to be heavily influenced by Korabl's older song. The band has released a few great videos. One starring U.S. trash cinema guru Lloyd Kaufman of Troma Entertainment is available on the band's most recent CD, "Chyornoye Utro" (A Black Morning.) Friends of the local band Dva Samaliota, Korabl recorded the album at Dva Samaliota's studio in St. Petersburg in 2003. The recent local sensation, Obmorok 'n' Mama, a band that performs local bands' better-known songs in a Central Asian style, decked out in traditional Central Asian clothes and musical instruments, will perform at Fish Fabrique on Saturday. Its best-known number is a treatment of Leningrad's mega hit "www." Poimanniye Muravyedy, the band whose style is frequently described as "Rasta-Latino-core," will play at Moloko on Wednesday. The band has received support from Leningrad's frontman Sergei Shnurov, who recently released its debut album on his own label, Shnur'OK. Billy's Band, the band that combines Tom Waits with St. Petersburg's cloudy atmosphere, will perform at the Red Club on Saturday, officially to launch its new single, "Otorvyomsya Po-Pitersky" (Having Fun St. Petersburg Style). Red Club, which was responsible for some of the best local concerts this year, will close for the time being after the Sunday concert. According to art director Claire Yalakas, the break has been forced on by the seasonal drop in concert activities. Before it reopens some time in September, the venue will have undergone some repairs and renovation, mostly affecting the second-floor hall used for DJ parties. A trio of the oldest local underground rock clubs, Fish Fabrique, Griboyedov and Moloko, all confirmed this week that they will continue to be open throughout the summer. To help the public survive the hot days, Fish Fabrique set up a few outside tables, which will operate until 11 p.m. In the meantime, Griboyedov has conveniently turned the top of the bunker where it is located into an open-air cafe. - By Sergey Chernov TITLE: meatballs for a workday lunch AUTHOR: Katya Golubeva PUBLISHER: Special to The St. Petersburg Times TEXT: Daily working life hardly gives us a chance eat properly. We leap up in the morning, sip a cup of black coffee and rush to the office. When it comes to lunch, the question of price, quality and time arises. To find a place with a good meal and tolerable prices is not so easy, especially if, like most of us, you have only an hour lunch break. But in one industrial zone of St. Petersburg there is a canteen that is a cut above the average workday eating place. Frikadelky - which means meat balls - is red, but not in the old Soviet sense (it has red tables, chairs, and walls and even the waiters wear red T-shirts). Rather, it is a "self-service," European-style canteen which opened only a couple of months ago and has already become popular among the office workers in the neighborhood. My lunch hour is usually at 1 p.m. and about that time I always feel the need to feed my stomach with delicious Frikadelky. The menu is very varied here, they serve about 10 kinds of starters and 15 main courses. A gloomy, rainy day inspired my work mate and I to have something out of the ordinary to spice up our lunch break. For the starter I had the squid salad (56 rubles $1.93) served with sweet red, yellow and green pepper and olives. The squid was rather bland and even the juicy peppers struggled to make it appetizing starter. My colleague's summer salad (43 rubles, $1.48) was quite plain, a seasonal mix of fresh cucumbers, leeks and cabbage served with olive oil. This salad was perhaps more suitable for a hot summer day somewhere in the countryside than a rainy St. Petersburg afternoon. For the main course I chose salmon served with almond and mushroom sauce (76 rubles, $2.62) with a side order of rice with vegetables through it (25 rubles, 86 cents). The salmon was soft and succulent, although I didn't find any traces of almond in it. My friend selected mushroom soup (35 rubles, $1.20), and it was a pleasant surprise to find pretty Russian mushrooms instead of tasteless defrosted mushrooms from a plastic bag. Looking through the large windows at the passers-by on the wet streets we started dessert, grateful to have an excuse to stay in the canteen for a little while longer. My almond cake (20 rubles, 68 cents) was very good indeed. To accompany my cherry juice (15 rubles, 51 cents) my work mate tried baked cherry pie (15 rubles, 51 cents) and a cup of sweet-smelling fruit tea (25 rubles, 86 cents). The most outstanding thing about this canteen is the music. Compared to other lunch time bistros where you run the risk of choking on your roast beef thanks to the new "masterpiece" of Russian pop idols Filipp Kirkorov and Masha Rasputina, here you can enjoy your meal listening to the laid-back compositions of Gotan Project, French DJ Dimitry's mixes and Latin American melodies. The only thing that puzzled me about the spot is the constant showing of documentary films about the lives of wild birds. Perhaps these films help with digestion in some special way? European canteen Frikadelky, Stachek Ploshchad. Tel: 449 2230. Open daily from 8.30 a.m. till 10 p.m. Menu in Russian. Lunch for two, with two drinks 310 rubles ($10.68). TITLE: agapova's route AUTHOR: By Darya Agapova PUBLISHER: Special to The St. Petersburg Times TEXT: Artists from the group "Derevnya Khudozhnikov" (Artists' Village) and the National Center for Contemporary Art have prepared an ingenious summer gift for those wishing to get out of the city and participate in current art events at the same time. They've contrived an original way to install several projects by artists from St. Petersburg and abroad into the green, natural scenery of the countryside. A kind of an "art-in-the-countryside party" is to take place at Tatyana Nikolayenko's suburban studio, from 6 p.m. on Friday until Sunday in Ozerki, near Udelnaya metro station. The new project is part of "Contemporary Art Week," organized by "Derevnya Khudozhnikov," a union of artists created at the beginning of the '90s as a shelter from commercialization. For studios they use old wooden houses without amenities but with a romantic aura of history and an intimacy with nature, making good use of the last islands of country life near the city. The idea of open-air attractions brings to mind the garden exhibitions at the Anna Akhmatova Museum -"The Garden of Sculpture and Relaxation" and "The Garden of Eden," which took place in the courtyard of the Fontanka House. There is also some similarity to annual open-air displays when artists in the Ozerki area put their art works on rafts to float along the nearby lakes. However, this project is considerably different in that it is going to be an artistic game, in which art works and visitors are invited to become participants. The title of the project -"Mimicry" - refers to the ability of some animals and insects to camouflage themselves in order to hide. So, the art is intended to simulate nature, and everyday objects, and the visitors' task is to discover and identify them. Among the participants are Vladimir Bystrov, the U.K.'s Tom Gillespie, the Musorshiki Art Group, Yelena Gubanova, Ivan Govorkov, Difolso Pasquale from Italy and others. The woman behind the concept is Ludmila Belova, an artist who is known for her works appealing to the human senses - memory, nostalgia, experience of different spaces and so on - something which is not common in contemporary art. And most of the "countryside" artists share in this human and amicable artistic mode. Open-air project "Mimicry" runs through July 9-11. How to get there: bus or taxi-bus 40 from metro station Udelnaya to the end. Address: 2 Ryabinovaya Ulitsa. Links: http://ozerki.spb.ru/ (only in Russian). The National Center for Contemporary Art: office@ncca-spb.ru Tel: 277 7967, 431 9905 TITLE: kabakov's 'soviet toilet' on show AUTHOR: By Andrei Vorobei PUBLISHER: Special to The St. Petersburg Times TEXT: An important exhibition by modern artist Ilya Kabakov and his wife Emilia, mounted by the State Hermitage Museum, features 'The Toilet' and other installations The State Hermitage Museum is establishing a good tradition of bringing a representative exhibition of the work of a living mega-star of international contemporary art every summer. Last year the museum mounted a show by the 76-year-old American abstractionist Cy Twombly. This time it is Ilya Kabakov. Kabakov, who was born in Soviet Ukraine in 1933, became the key figure of the Moscow Conceptualism art movement of '70s and '80s. After emigrating to the West in 1988 - he now lives and works in New York - Kabakov became the most celebrated living Russian artist in the world today. The Hermitage show, "The Incident in the Museum and Other Installations," which opened in the General Staff Building on June 23, presents Kabakov's work after he emigrated. At this time he began working in cooperation with his wife Emilia. "Our task is to inculcate in St. Petersburg auditory a taste for contemporary art," Mikhail Piotrovsky, the director of the Hermitage, said at the symposium dedicated to Kabakov held the day after the exhibit's opening. Kabakov's reputation in the West is witnessed both by his participation in major international contemporary art festivals such as the Venice Biennale or Kassel's Documenta, and the demand that the world's major museums such as New York's Guggenheim and Museum of Modern Art, the Centre Georges Pompidou in Paris, and others, show for his work. Kabakov's contribution to contemporary art comes in two forms: "total installations" and "albums" - the most famous of these is the "Ten Characters" album of 1988, which was on display in Moscow this spring. Thanks to the current exposition you will have a good idea about the former and next to nothing about the latter. But that definitely doesn't make the exhibition less interesting. There is no one approach to the Kabakov's many-sided installation art, so we will stop at that aspect that is to be seen within the exposition. On the basis of the installations on disply - some of them are in presenta while others are in the form of models - different periods can be drawn up. The first period covers installations of the early '90s and is inspired by and benefits from strongly Soviet themes. At this time, the main artistic task and process was the "archiving" of the lost Soviet civilization. A book on the Kabakov of this time written by American art critics Amei Wallach, Robert Storr and others was called "The Man Who Never Threw Anything Away." The process of collecting and preserving is total in character - he gathers everything from the signatures and signs of Soviet soldiers on the walls of the Reichstag to whole Soviet environmental spaces, from ordinary public toilet buidings to school classrooms, communal apartments, and hospitals. But what is more important, besides the archival nature of the works, is the conceptual process that takes place. Indeed, many of his installations of this period appears as "metasystems" of Soviet civilization in the form of metaphor, as in "The Ship" (1985-1989), "The Red Wagon" (1991), "The Red Pavilion" (Russian Pavilion of Venice Biennale, 1993) and "Vertical Opera" (1997). Thanks to the metaphoric starting point of many of the installations, even with their roots in Soviet culture, they obtain other universal readings and meanings. A good example of this is the installation which appears from the outside to be an ordinary Soviet public toilet. Inside the "The Toilet" (1992), the artist has made living rooms - with a reception-room in the Gents side of the toilet and a bedroom in the Ladies. The idea of the delicate correlation between the private and public, which came from Soviet communal living, in the West garners other interpretations. In this way "The Toilet" has a common universal, multifunctional meaning, without attachment to place or time. By analogy to the international currency system, we could say that "The Toilet" is a unit of "freely convertible art" across boundaries. Evidence of the completion of this period, summed up here, can be seen Kabakov's grand project "Monument to a Lost Civilization" (1999), which consists, according to the catalog, of 37 installations made by the artist before and during this period and is divided into the seven following representative sections: "Area of Communist Ideology and Propaganda," "Communal Life," "Bureaucratic World," "Museum and Educational Zone," "The Hospital and Scientific Research," and "The World of the Memory." This impressive and complicated socio-cultural formation focuses on the correlation between private and public on different micro and macro social levels in Totalitarian society in general. As we can see from his latest works (from the late '90s and 2000s), Kabakov has overcome an explicit Soviet influence or at least excludes the "Sovietskoye" (the Soviet existence). In another words, the Soviet source material stops being the cross-linking component of his work. Kabakov's installations evolve toward a more intercultural, universal, cosmopolitan - and often utopian - stance, as is in "The Palace of Projects," "Volcano-Opera (Wagner Opera)," "Center for Cosmic Energy," and "Fragment of a Staircase." All of them are in opposition to the previous period, and are all about the present and the future. Interestingly all the installations on display exist in model form alongside and are accompanied with weighty descriptions, drawings, and plans. With his later, forward-looking works, this perhaps links the artist's intentions to utopian projects of Russian avant-garde of the first decades of last century. Or as the prominent philosopher and art-critic Boris Groys put it during the symposium, "Kabakov's art could be considered as a part of the Russian avant-garde." The artist himself, who was present at the Hermitage, was thoughtful in his comments on this. He said that many ideas proposed within Russian avant-garde were exciting, but there wasn't a place for man in their concepts and "Thank God nothing was realized from it." Indeed Kabakov's marvelous installation "The Man Who Flew into Space from His Apartment' (1976) is also about the Russian avant-garde, but from the side of ordinary man. "The Incident in the Museum and Other Installations" at the Hermitage General Staff Building, through Aug. 29. Links: www.hermitage.ru, www.ilya-emilia-kabakov.com TITLE: abdrazakov, borodina united in song AUTHOR: By Galina Stolyarova PUBLISHER: Staff Writer TEXT: Mariinsky Theater graduates Ildar Abdrazakov and Olga Borodina are no ordinary couple: they combine family life with traveling the world as superstars of opera. In individual interviews, they discussed the highs and lows of operatic life. "I just want to remind St. Petersburg that I am alive and I sing," says bass Ildar Abdrazakov cheerfully of his forthcoming appearance in Verdi's "Requiem" at the Mariinsky Theater on July 12. People do need a reminder: Abdrazakov's dark, velvety voice, boasting an impressive range and smooth technique, along with the bass' powerful stage presence, has been absent from the local stage for nearly three years, except for just one performance last summer. After international recognition, the 28-year-old Ufa native landed plum roles at world's most respected venues, including La Scala in Milan, Italy, and New York's Metropolitan Opera. Abdrazakov had been planning another appearance at this year's "Stars of the White Nights" arts festival at the Mariinsky, in Saint-Saens's "Samson et Delilah", but cancelled the engagement because the dramatic baritone part of the High Priest did not feet natural to his bass voice. "It was fine during rehearsals but I felt it would be too uncomfortable on stage and have decided to put the part aside for the time being," the singer explained. Born in the capital of Bashkiria in 1976, Abdrazakov had his first music lessons there, with Professor Milyausha Murtazina. He made his debut at the Mariinsky in 1998 as Figaro in Mozart's "Le nozze di Figaro" to high critical acclaim, drawing immediate public attention. It was the start of a breathtaking international career. In the following year, the singer received all possible awards at Russian contests for vocalists, but the turning point was the Grand Prix at the Fifth Maria Callas Competition "Nuove voci per Verdi" in Italy in 2000. The victory brought multiple lucrative contracts and exposure to classical gems unseen on the Russian stage: Bellini's "Norma," Rossini's "Moise et Pharaon," "Semiramide," "Il Turko in Italia" and "L'italiana in Algeri." Abdrazakov fully immersed himself into the world of Rossini and Mozart, whose operas now form the lion's share of his repertoire. Abdrazakov was enthusiastic about his foreign engagements, eager to sing Moses, Mustafa (in L'italiana in Algeri"), Selim (in "Il Turko in Italia"), Ferrando (in "Il Trovatore") and Don Basilio (in Il Barbiere di Siviglia"). All in all, he reckons he has probably given more performances at La Scala than at home. However, upon his winning the Callas award there hasn't been much work on offer at the Mariinsky. "It is partially because here they plan short-term, and would normally announce a new production only in a month in advance, while in Europe they plan several whole seasons ahead," he explains. "At first, I just signed everything because I loved everything that I was offered, and then it turned out that I would be so busy I wouldn't come home for nine months," he recalled. "I now always look for a proper balance." The artistic turning point in the singer's career came in 2000 and the role of Leporello in Mozart's "Don Giovanni." "Leporello with [German director] Johannes Schaaf liberated me," Abdrazakov recalls. "The director tuned me up, and opened my eyes to the dramatic element which I hadn't fully appreciated." The singer admits not having sang in Russian during his time abroad - not by choice, yet neither to his particular regret. A suitable repertoire of Russian roles in operas such as Rakhmaninov's "Aleko", Glinka's "A Life For The Tsar" ("Ivan Susanin") or Rimsky-Korsakov's "Sadko," do not tend to be performed outside Russia. "Now, I wouldn't sing in "Susanin" or "Boris Godunov" because everything takes time," the singer said. "More importantly, belcanto suits my voice much better." Apart from one recital during the "Stars Of The White Nights" in 2003, Abdrazakov has not sang in St. Petersburg since he won the Callas contest. During his current visit Abdrazakov was amused when a colleague greeted him with commiserations, having assumed Abdrazakov was back working in Bashkiria and that he must have a drink problem that keeps him out of sight! This is a stunning reception for someone who opened this season in La Scala as Moses in Rossini's grand biblical opera "Moise et Pharaon" under the baton of Riccardo Muti, and has been invited to sing Mephistopheles in Gounod's "Faust" at the Met, and "The Tales of Hoffmann" in the Madrid Opera in 2005-06 and 2006-07 seasons. Abdrazakov's tight schedule makes it difficult for him to accommodate the Mariinsky, as his first priority is coordinating his plans with those of star mezzo soprano Olga Borodina. The couple, happy parents of 18-month-old Vladimir-Amir, struggle to adjust their international engagements and it requires substantial effort to match their schedules. The last time they were on stage together was several months ago. This fall should be easier on the opera singing couple in this respect, with Abdrazakov scheduled to perform Escamillo opposite Borodina playing the title role in Bizet "Carmen," at the Met and the opera festival in Seville, Spain. "We are trying to arrange to sing in same production, or at least in same companies at the same time for the family to be able to stay together for longer," Abdrazakov said. The bass singer said he doesn't feel comfortable in modernist or radical productions, finding conceptually intense shows emotionally tiring. "When everything is all cubic or round, and there are barely two colors involved, it is difficult to maintain a convincing stage presence," he says. "Special effects shouldn't be a substitute for drama or the tension between the singers on stage." The next time after this week that the St. Petersburg audience can see Abdrazakov will be in December, when the singer comes back from his foreign tours. "My suitcases never really get put away as I keep packing them to go somewhere," he said. "But I do want to come back to the Mariinsky stage, and I hope something will happen in this regard. Again, I just want to remind people that I am alive and that I sing." TITLE: the ambitious diva with designs to direct AUTHOR: By Galina Stolyarova PUBLISHER: Staff Writer TEXT: Arguably the most successful Dalila on the contemporary stage, renowned Mariinsky mezzo soprano Olga Borodina is in town this week for two performances at her musical alma mater. Borodina sings in Saint-Saens' "Samson et Dalila" on July 9 and appears in Verdi's "Requiem" on July 12. The production, which is directed by Charles Roubaud and premiered last winter, is the first Mariinsky production specifically designed to suit the diva. The mezzo soprano famous around the world for her deep, smooth and creamy voice, divides her time bewteen St. Petersburg, New York, Milan and other musical capitals. Her most recent engagement was as Isabella in the Metropolitan Opera's take on Rossini's "L'italiana in Algeri" in New York. The staging was a long-awaited - and crtically triumphant - return to Rossini. Isabella was a huge challenge both vocally and artistically since acting a comic persona after years of dramatic roles required a complete mental transformation for Borodina. "I haven't touched Rossini for eight years, and it was very difficult to re-adjust my voice and style from the heavy Verdi roles," Borodina said. "But it paid off, and was praised both inside and outside the company, with [the Met's artistic director] James Levine saying I was doing what I was born to do." In the production Borodina was partnered by bass Ferruccio Furlanetto, except for the last performance, when Ildar Abdrazakov appeared as Mustafa to rave reviews; the singers, who are a couple off stage, received several invitations to perform together after this, thanks to the chemistry shown on stage. Borodina joined the Mariinsky company in 1987 and had her international debut at Covent Garden, singing Dalila alongside Placido Domingo's Samson. A remarkably flexible performer, Borodina sings both dramatic and lyrical roles with equal talent. Borodina's career long ago came to the point where she is asked what she wants to be perform, when and with which conductor. But even at this level of stardom and power in the opera world there can be dissappointments. Borodina's particular frustration came before a recent premiere of "Carmen" at La Scala in Milan this season, where she was invited to sing the title character. "Carmen" exists on stage in two versions - with composed recitatives or in the opera comique style with spoken dialogs. Just one week before curtain-up, Borodina was told that the production was the dialog version - a complete shock for the diva. "The contract had been signed 4 years ago but then several months before the premiere they decided to do a different version," Borodina explains. "They didn't tell me until the last minute because they were hoping to convince me and talk me into it. I was all the more outraged given that it is a known fact that I never sing the version with dialogs. "La Scala sees itself as the best operatic venue but if they really were, they would have never allowed such things to happen," the singer added, her outrage visibly growing as she spoke. Borodina pulled out of the production. But there are two other productions of "Carmen" waiting in the wings this fall - at the Met and at the Seville Opera Festival in Spain. Unfortunately there is no performance of Carmen planned for Russia at this time. But Borodina is pleased to sing Dalila for Russian audiences, something she had dreamed about for years, although she wishes the production itself had more drive and brighter colours. The production feels too cold for the singer. "I personally don't associate sex with colours like grey, black and white," she said. "For me, they don't really go well with sexual music. Life provides us with enough grey already." With her sharp insights in how opera works and forthright views on the productions she is involved in, Borodina is seriously considering trying her own hand at directing an opera. "Having seen so much, and having performed so much I immediately see what is going to work, and what is not," she said. "And when I point these details out to directors, they agree, and the shows benefit. I feel prepared to direct an opera and I hope to be able to make it happen. What would her own "Samson et Dalila" be like then? "I would design the stage in bright, emotionally charged, colours," Borodina said. "It is important, for this opera, to have a particular singer to perform Samson and to develop all details to suit him to make it work." Borodina says that her future lies in St. Petersburg, as does that of her partner Abdrazakov, their baby son Vladimir-Amir and her two elder sons from previous marriages. "We all have too much of a Russian personality," she said. "This country is a very spiritual place, and we get nostalgic when we are away for too long. It is the only place for the heart to recover." Olga's eldest son, who is entering the St. Petersburg Conservatory this year, constantly tells her that the two youngest brothers who travel with their mother around the world, should spend more time and study in Russia. "He says it is important for a Russian person to spend time in Russia to absorb its culture," Borodina said. "Ildar and I travel a lot but we both don't see ourselves permanently living abroad. We would always be alien there. We might pretend we are not but we always will be." Borodina's next engagement in Russia after this week will be in Rimsky-Korsakov's "Tsar's Bride" at the Mariinsky in December this year. TITLE: Former Enron Boss Indicted on Charges AUTHOR: By Kristen Hays PUBLISHER: The Associated Press TEXT: HOUSTON, Texas - Kenneth Lay, the founder and former chairman and CEO of Enron Corp. who says he committed no crimes at the scandal-ridden energy company, has been indicted on criminal charges, sources said. The highly anticipated action came Wednesday, 2 1/2 years into a methodical investigation that has produced charges against some of Lay's once most highly trusted lieutenants, including his hand-picked protege, former CEO Jeffrey Skilling. "I have done nothing wrong, and the indictment is not justified," Lay, 62, said in a statement Wednesday after learning of the indictment. The indictment was to be unsealed after Lay surrendered to the FBI early Thursday. Prosecutors from the Justice Department's Enron Task Force presented an indictment to U.S. Magistrate Judge Mary Milloy in Houston on Wednesday, and at their request she sealed both the indictment and an arrest warrant, the sources said. The specific charges remained under seal. A hearing before Milloy was scheduled for Thursday. Lay's lawyer, Michael Ramsey, didn't immediately return calls for comment. The Securities and Exchange Commission also was expected to bring civil fraud charges against Lay on Thursday, including making false and misleading statements and insider trading, a person familiar with the case said, speaking on condition of anonymity. Prosecutors have aggressively pursued the one-time celebrity CEO and friend and contributor to President Bush who led Enron's rise to No. 7 in the Fortune 500 and resigned within weeks of its stunning failure. Lay is the 30th and highest-profile individual charged. Skilling succeeded Lay as CEO in February 2001 and resigned abruptly six months later, just weeks before the scandal broke. He was indicted in February on nearly three dozen counts of fraud and other crimes. Waiting to testify for the prosecution is former finance chief Andrew Fastow, who pleaded guilty to two conspiracy counts in January. Fastow admitted to orchestrating partnerships and financial schemes to hide Enron debt and inflate profits while pocketing millions of dollars for himself. Enron's collapse led a series of corporate scandals that prompted Congress' passage of sweeping reforms to securities laws with the Sarbanes-Oxley Act two years ago. Thousands of Enron's workers lost their jobs, and the stock fell from a high of $90 in August 2000 to just pennies, wiping out many workers' retirement savings. The charges against Skilling and former top accountant Richard Causey-who was indicted a week after Fastow pleaded guilty-target actions over several years leading up to Enron's collapse. Lay told The New York Times last month that he didn't believe the company had serious problems and trusted other senior managers-including Fastow and Causey-when they reassured him that all was fine. Skilling and Causey are awaiting trial on conspiracy and fraud charges. TITLE: Archdiocese Says it Can't Pay Sex Claims AUTHOR: By Aviva L. Brandt PUBLISHER: The Associated Press TEXT: PORTLAND, Oregon - The Portland Archdiocese said Tuesday that it will file for bankruptcy because it can't afford to pay the potential cost of sex abuse lawsuits, becoming the first Roman Catholic diocese in the nation to seek such court relief. The Chapter 11 bankruptcy action, planned for Tuesday afternoon, froze the start of a priest abuse civil trial involving the late Rev. Maurice Grammond, who was accused of molesting more than 50 boys in the 1980s. Grammond died in 2002. Plaintiffs in two lawsuits involving Grammond have sought a total of more than $160 million. The archdiocese and its insurers already have paid more than $53 million to settle more than 130 claims by people who say they were abused by priests. Dozens of other claims are pending, and at Tuesday's news conference, church officials said they could not afford what the plaintiffs are asking. "The pot of gold is pretty much empty right now," Archbishop John Vlazny said, who warned parishioners last year in a letter that the archdiocese might go bankrupt. James Devereaux, one of the plaintiffs in the lawsuit that had been scheduled to go to trial Tuesday, vowed that in spite of the announcement, "We will continue our fight to finally get the archdiocese to accept the sin of its crimes." David Slader, a plaintiffs' attorney, said the church was simply trying to avoid the details of the lawsuit coming out in court. "The bishop hasn't begun to touch his pot. He is lying," Slader told reporters. No other U.S. diocese has ever declared bankruptcy, according to Fred J. Naffziger, a business law professor at Indiana University. Tom Stilley, the attorney handling the archdiocese's bankruptcy filing, also said it was the first such case, but added other dioceses are considering the same step. Chapter 11 bankruptcy frees an organization from the threat of creditors' lawsuits while it reorganizes. However, it could also open church records to public scrutiny, and could require church leaders to cede some control to the courts. TITLE: IN BRIEF TEXT: Milosevic Fit for Trial THE HAGUE (AFP) - The trial of Slobodan Milosevic before the UN war crimes court will resume July 14 if the health of the former Yugoslav president permits, the court ruled. "The trial is adjourned until Wednesday 14 July, 2004, at which time, subject to the medical condition of the accused, it will recommence," the three-judge panel presiding over the case said Tuesday in its ruling. The mammoth trial, already well into its third year, was supposed to resume Monday with Milosevic making his opening statement, but hearings were postponed indefinitely after doctors recommended he needed more rest. The former Yugoslav president faces over 60 charges of war crimes and crimes against humanity over his alleged central role in the wars in Croatia in 1991-95, Bosnia in 1992-95 and Kosovo in 1998-99. Klestil Mourned VIENNA (AP) - Austria began four days of mourning on Wednesday for former President Thomas Klestil, who helped distance Austria from its Nazi past and strengthened the country's ties with emerging Eastern European democracies. Klestil, 71, died Tuesday of multiple organ failure, just two days before the end of his second six-year term. A public memorial service was to be held Friday in a chapel in the Hofburg, the imperial palace in central Vienna where the presidency is based. Klestil was to be buried at Vienna's Central Cemetery after a requiem Mass at St. Stephen's Cathedral, the Austria Press Agency said. Cole Suspects Charged SAN'A, Yemen (AP) - A security court charged six alleged al-Qaida members Wednesday with plotting the attack on the USS Cole, opening the first trial in the suicide bombing that killed 17 American sailors. Among the defendants is reputed mastermind Abd al-Rahim al-Nashiri. Police and soldiers cordoned off the security court in San'a, and marksmen watched from rooftops, as five of the defendants were brought in to hear the judge read their indictment. Al-Nashiri, the sixth defendant, is in U.S. custody. The attack occurred in October 2000 when two suicide bombers brought a small boat alongside the destroyer as it refueled in Aden harbor. The bombers detonated explosives stashed on the boat, killing themselves and 17 sailors, and blasting a huge hole in the ship's hull. SARS Official Resigns HONG KONG (AP) - Bowing to pressure over a slow, sloppy response to SARS, Hong Kong's health secretary resigned Wednesday to take blame for the crisis that killed hundreds and caused months of uncertainty and fear in the territory. Yeoh Eng-kiong became a rare political casualty in a territory where critics charge that top aides of Hong Kong's leader, Tung Chee-hwa, often avoid being held accountable for problems. Yeoh's departure might give Tung a boost at a time when Hong Kongers are furious at a recent decision by Beijing ruling out full democracy in the next few years. The anger spilled into the streets last week in a pro-democracy march by several hundred thousand people. Yeoh ran into trouble this week after a legislative report Monday blamed him for many failures in the fight against severe acute respiratory syndrome. Dozens of relatives of SARS victims gathered outside the legislature Wednesday to call for Yeoh's removal. TITLE: Olympian Breaks His Own World Record AUTHOR: By Beth Harris PUBLISHER: The Associated Press TEXT: LONG BEACH, California - Michael Phelps claimed the first spot on the U.S. Olympic swimming team with a world-record performance. He believes he can go even faster in Athens. The 19-year-old from Baltimore broke his own record in the 400-meter individual medley with a time of 4 minutes, 8.41 seconds Wednesday on the opening night of the trials. "I wanted to go into the Olympics with the fastest time in the world," he said. Phelps set the previous record of 4:09.09 last year in the world championships in Barcelona, where he became the first swimmer in history to break five world records in one meet. There's no telling what he'll do in his other five events in the eight-day trials. Phelps' goal is to break Mark Spitz's 32-year-old record of seven Olympic gold medals. "There are a few things I can fix, so at least I hope there's another hundredth or tenth in that race," he said about possibly lowering his latest world mark in Athens. Natalie Coughlin, also expected to emerge as a star in Athens, will swim her first event Thursday in the 100 backstroke. Three-time Olympian Jenny Thompson, who has a record 10 Olympic medals but not an individual gold, qualified for the 100 butterfly final Thursday night. She was fifth fastest in the semifinals at 59.17 seconds. "I look to get better and better," she said. Ed Moses and Brendan Hansen, who shared the American record, set up a showdown in the 100 breaststroke final Thursday night. Hansen's semifinal time of 1:00.13 gave him sole possession of the American record and just missed the world mark of 59.78 set by Japan's Kosuke Kitajima. Moses qualified fourth at 1:01.82. Phelps was off record pace through the opening butterfly leg of the 400 IM, but made up for it in the backstroke. He even had a chance to sneak a glimpse at the scoreboard. "If there's a clock there, I'm going to look," Phelps said. The crowd of more than 7,000 fans chanted "Go! Go! Go!" each time Phelps poked his head above water during the breaststroke. They rose to their feet as he powered to the wall during the freestyle portion. "Maybe it looked effortless, but it didn't feel effortless," he said, grinning. Erik Vendt finished second to Phelps, more than 5 1/2 seconds behind in 4:14.09. "For me, getting second and making the team is just as good as winning," Vendt said. Phelps wasn't the only impressive swimmer in the 400-meter individual medley. Katie Hoff, a 15-year-old from the same North Baltimore club as Phelps, swam the second-fastest time by an American to win in 4:37.67. She just missed Summer Sanders' 12-year-old national mark of 4:37.58. "During the first 200, I was going, 'OK, OK, don't worry about anybody else. Just stick to my plan,'" she said. "On the breaststroke, I tried to start passing people. On the last 100, the crowd came in and started cheering. I tried to come home very fast." Kaitlin Sandeno, an Olympic medalist from Sydney, was second in 4:40.39. Klete Keller won the 400 freestyle with an American record of 3:44.19, more than 2 seconds better than Phelps' mark set last August. Larsen Jensen was second at 3:46.56 - also under the previous record. "I was more nervous than I've ever been," said Keller, who won a bronze medal in the same event at Sydney four years ago. "I almost felt like I was going to cry before the start. I don't know why. I just remembered what my coach said, 'You don't have to feel good to swim fast.'" Keller has his work cut out for him in Athens. He was still more than 4 seconds slower than Australian star Ian Thorpe, who has the eight fastest times in history. "I'm just going to enjoy this and keep working hard," Keller said. "Maybe I'll see if I can go a little faster." Phelps was relieved to make it through the first event in Long Beach, where the U.S. team is being decided in a temporary pool set up on a parking lot along the shoreline. "The trials are probably more stressful than the Olympic finals," he said. TITLE: SPORTS WATCH TEXT: Sharapova's China Open BEIJING (AP) - Newly crowned Wimbledon champion Maria Sharapova of Russia joins fellow finalist Serena Williams to head up the women's roster at the China Open starting September, organizers announced Wednesday. The men's lineup for the tournament includes Marat Safin of Russia and Asian No. 1 Paradorn Srichaphan of Thailand.China has high hopes for the Sept. 10-26 event in Beijing. "We hope this will become the No. 5 tennis tournament in the world" after the four Grand Slam events, said Tommei Tong, chief financial officer of Tom Group Ltd., one of the sponsors. Greece Climbs Charts LONDON (Reuters) - European champion Greece has soared 21 places to its highest position of 14th in FIFA's latest rankings. Brazil still holds top spot as the Copa America begins, ahead of second-place France, beaten 1-0 by Greece in the Euro 2004 quarterfinals when they were defending their European title. Czech Republic rose seven places to fourth after its semifinal finish in Portugal. Greece beat hosts Portugal 1-0 in Sunday's European championship final. Portugal have risen 10 places to equal 12th with Germany who fell four places after being knocked out in the Euro 2004 first round. Spain remains in third despite being knocked out in the group stage in Portugal. Russia climbed five places to 26 despite its disappointing Euro 2004 campaign. France Eyes Hoddle PARIS (Reuters) - Former England manager Glenn Hoddle says he is convinced that a foreign coach could revive the France national team after their Euro 2004 failure. Hoddle officially asked to be considered for the vacant post on Tuesday following Jacques Santini's departure to Tottenham Hotspur. "Coaching Les Bleus would be a huge privilege," Hoddle, a former Tottenham player, told sports daily L'Equipe on Wednesday. Quenneville Avalanche DENVER (AP) - Former St. Louis Blues coach Joel Quenneville has been hired to replace Tony Granato as coach of the Colorado Avalanche. Granato, who coached the Avalanche since 2002, will revert to his former position as assistant coach, team spokesman Hayne Ellis said early Wednesday. Avalanche general manager Pierre Lacroix scheduled a news conference for Wednesday afternoon to announce the changes. Quenneville previously was an Avalanche assistant under coach Marc Crawford in 1995-96 and played a role in the franchise's first Stanley Cup championship. Deco completes move MADRID (Reuters) - Portugal midfielder Deco, who signed a four-year contract with Barcelona on Tuesday, said the Catalan side was the only club he wanted to join after deciding to leave European champions Porto. "If I could have chosen any club in the world to join it would have been Barca," the 26-year-old said. Barcelona agreed to pay Porto between 12 million and 15 million euros ($18.48 million) plus Portuguese winger Ricardo Quaresma in exchange for the Brazilian-born playmaker. Barca president Joan Laporta said he was delighted Deco had opted for the Catalan club in preference to English Premier League side Chelsea, who were also interested in signing the talented midfielder. Rooney to Stay BANGKOK (Reuters) - Everton has quashed media reports linking teenage England striker Wayne Rooney with a move to Manchester United. Rooney has been offered a new five-year contract - the most lucrative in the Premier League club's history - to stay at Goodison Park amid speculation that his sparkling performances at Euro 2004 could trigger a move to a bigger club. "I can confirm to you that we've had no interest expressed by Manchester United. We hope that they can't afford Wayne Rooney and effectively that Wayne will stay with Everton," director Paul Gregg said after the club clinched a $2.75 million shirt sponsorship deal with a leading Thai brewer on Wednesday. TITLE: Florida Marlins End Pittsburgh Pirates' Win Streak PUBLISHER: The Associated Press TEXT: MIAMI, Florida - The Pittsburgh Pirates' 10-game winning streak ended, with Alex Gonzalez hitting a tiebreaking, three-run homer in the seventh inning Tuesday night that led the Florida Marlins to a 6-3 victory. Pittsburgh's winning streak was its longest since the Pirates won 11 in a row from Sept. 12-22, 1996. NL Rookie of the Year Dontrelle Willis remained winless in four starts since June 13 despite allowing just one run and five hits in six innings. He left with a 2-1 lead, but Jack Wilson hit a sacrifice fly in the seventh off Josias Manzanillo and pinch-hitter Rob Mackowiak had an RBI single of the first pitch after Matt Perisho relieved with two outs. Trailing 3-2, Florida rallied in the seventh against Mark Corey (0-2), who walked Hee Seop Choi leading off and allowed Miguel Cabrera's tying double to right-center. Cabrera was thrown out at third, but Corey walked Mike Lowell and Abraham Nunez. Salomon Torres came in and retired Luis Castillo for the second out of the inning, then allowed Gonzalez's homer on an 0-2 pitch. Nate Bump (2-3) pitched 1 1-3 hitless innings, and Armando Benitez pitched a perfect ninth for his 28th save in 30 chances. The defending World Series champions won for just the second time in seven games and avoided dropping to .500. Tigers 9, Yankees 1. In New York, Jason Johnson pitched eight dominant innings and Rondell White and Bobby Higginson hit two-run homers to help the Detroit Tigers beat the New York Yankees Tuesday night, ending their five-game losing streak. Dmitri Young had three doubles and two runs scored, Carlos Guillen had a two-run single, and White added an RBI single against his former team as the Tigers rebounded from a 10-3 loss to New York on Monday with their first win at Yankee Stadium since Sept. 7, 2002. A night after Esteban Yan was ejected for throwing over the head of Yankees third baseman Alex Rodriguez, All-Star catcher Ivan Rodriguez was hit in the elbow by reliever Tanyon Sturtze with two outs in the ninth inning. In the bottom half, Tigers closer Ugueth Urbina threw behind Gary Sheffield and both benches were warned. New York lost for the fourth time in five games since completing a three-game sweep against the Boston Red Sox. Red Sox 11. Athletics 0. In Boston, Tim Wakefield pitched seven innings of three-hit ball for his first win in six weeks, and Johnny Damon singled five times Tuesday night as the Boston Red Sox rebounded from a horrible trip to rout the Oakland Athletics. Wakefield (5-5), winless in seven previous starts, did not allow a runner until Marco Scutaro hit a liner that drifted away from right fielder Trot Nixon for a double with two outs in the third. Only one other batter reached second against Wakefield, who struck out six and walked one. Bill Mueller hit a three-run homer in the second, and the Red Sox scored four times in the fourth off Barry Zito (4-6) and again in the fifth off Justin Lehr. Zito allowed seven runs - six earned - on nine hits and three walks in four innings, walking in two runs in the fourth. The 2002 AL Cy Young Award winner is winless in five starts. Devil Rays 3, Orioles 1. In Baltimore, Mark Hendrickson pitched eight shutout innings, and the Tampa Bay Devil Rays halted a three-game losing streak by beating the Baltimore Orioles 3-1 Tuesday night. Rocco Baldelli had four hits and an RBI for the Devil Rays, who ended their longest skid since a five-game drought in mid-May. Hendrickson (6-6) allowed six hits, struck out two and walked one in rebounding from two straight poor outings in which he was 0-1 with an 11.57 ERA. He allowed only two runners to reach third base. The left-hander previously helped Tampa Bay stop losing streaks of six games and seven games. o Freddy Garcia signed a $27 million, three-year contract extension with the Chicago White Sox on Tuesday, just 10 days after being traded from Seattle. The 28-year-old right-hander was eligible to become a free agent after this season. But the White Sox traded for him June 27 in the hope they could sign him to a longer deal. Garcia's longtime friendship with White Sox manager Ozzie Guillen was thought to be a selling point. Guillen also is from Venezuela and is the second cousin of Garcia's fiancee. "Ozzie had a tremendous role in it," White Sox general manager Ken Williams said. "The stars ended up ultimately aligning, but I think there was a little bit of aid in them aligning," he added. Garcia will earn $8 million in 2005, $9 million in 2006 and $10 million in 2007.