SOURCE: The St. Petersburg Times
DATE: Issue #985 (53), Tuesday, July 13, 2004
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TITLE: Klebnikov Slaying Probed at Top Level
AUTHOR: By Valeria Korchagina

PUBLISHER: Staff Writer
TEXT: MOSCOW - In a sign that the government has come to see the killing on Friday of Forbes Russia editor Paul Klebnikov as not just another murder, the unit of the Prosecutor General's Office that handles high-priority cases was put in charge of the investigation Monday.
 
"This means that the case's status has been raised," Prosecutor General's Office spokesman Viktor Potapov said. The case had been handled by the City Prosecutor's Office, whose investigators had reported little progress in the investigation.
 Klebnikov, 41, a U.S. citizen of Russian descent, was shot four times from a passing car about 100 meters from Forbes' editorial offices on Ulitsa Dokukina in northern Moscow at about 10 p.m. 
 He was still conscious when Alexander Gordeyev, the editor of the Russian edition of Newsweek, whose offices are in the same building, ran out onto the street. Gordeyev said Klebnikov told him he did not recognize the man who shot him and did not know who might have ordered the attack. Klebnikov died shortly after arriving at hospital No. 20, Gordeyev said. 
 Judging by his letter from the editor in the debut issue of Forbes Russia in April, Klebnikov seemed to believe that Russia had changed. He wrote that the readiness of the Russian market for such a publication was "one sign that Russian business has reached a new, more civilized stage of development."
 The first official reaction to the killing came Monday, when Mikhail Seslavinsky, the head of the Federal Press and Mass Media Agency, expressed his condolences to the family and friends of Klebnikov, a 41-year-old U.S. citizen.
 "A talented journalist and media manager has died," Seslavinsky wrote in an official statement carried by Interfax. "We hope that the motive behind the murder will be found and those guilty of the murder punished."
 The motive remained unclear. 
 The most popular theory put forward by Russian newspapers on Monday was that the murder could have been ordered by someone displeased by the list of Russia's 100 wealthiest people that was published by Forbes in May. 
 Along the same line went the theory that any other businessman investigated by Forbes could be linked to the murder.
 Mikhail Khodorkovsky, who topped the Forbes list, sent a letter of condolence to Forbes' offices in New York on Monday.
 "Paul undoubtedly made a very important contribution to promoting the traditions of openness and transparency in Russian markets," wrote Khodorkovsky, the jailed former CEO of Yukos. "He was a man one could argue with, in a constructive spirit, and argue we did. No matter whether they agreed or disagreed with him, many people disclosed things to Paul that had previously not been in the public domain."
 Another theory mentioned by a number of major newspapers, including Kommersant, Izvestia and Vremya Novostei, was that Chechen separatists could be connected to the killing. 
 Klebnikov published a book last year based on 15 hours of interviews with former separatist commander Khozh-Akhmed Nukhayev. The book, "Conversations With a Barbarian," is a mix of Nukhayev's tales of fighting in Chechnya, his views on the future of Islam in Russia and worldwide, and Klebnikov's own commentary. The book, the newspapers said, could have provoked a negative reaction from Nukhayev's immediate allies or other Chechen leaders on the separatists' side.
 Klebnikov met Nukhayev in the process of investigating Boris Berezovsky's connections to Chechen rebels. Berezovsky, too, was mentioned in the newspapers as someone who could have been sufficiently angry with Klebnikov to wish him dead.
 In 1996, Klebnikov published an article in Forbes in which he called Berezovsky a "powerful gangland boss" and accused him of ordering the 1995 murder of television journalist Vladislav Listyev. Berezovsky said the article consisted of a "series of lies" and sued the magazine in Britain.
 Klebnikov, however, persisted and followed up the article with a book titled "Godfather of the Kremlin: Boris Berezovsky and the Looting of Russia." 
 Berezovsky withdrew the libel suit last year after Forbes acknowledged that there was no evidence that he had ordered the murder of Listyev or anyone else.
 In a telephone interview over the weekend, Berezovsky said Klebnikov led a dangerous life. 
 "Somebody clearly did not like the way he operated and decided to sort it out with him, Russian-style, not through the English courts like I did," Berezovsky said. 
 Investigators as well as Klebnikov's colleagues and friends said they had little doubt the murder was directly related to his journalistic work.
 "Paul was a very independent journalist, was very professional and always spoke the truth. And there is no question that he died for speaking the truth," Boris Jordan, former general director of NTV television and a personal friend of Klebnikov's, said after a memorial service Sunday at St. Catherine the Great Martyr Church in central Moscow.
 The U.S. Embassy in Moscow said Monday it is staying in close contact with Russian law enforcement authorities regarding the investigation. 
 Embassy spokesman Thomas Leary issued a statement extending deep condolences to Klebnikov's family from Ambassador Alexander Vershbow and the entire embassy community. 
 "Paul Klebnikov's background and interests ideally suited him to the task of explaining Russia to Americans and vice versa," the statement said. "He was a person who tried to take the best American values - fair play, equality and openness - and apply them in Russia, a country that he loved," the statement said. 
 Irina Silayeva, general director of Axel Springer Russia, which publishes the Russian edition of Forbes, said Klebnikov's death will not affect the future of the magazine, which will continue to be published. 
 Forbes Russia publisher Leonid Bershidsky agreed. "I would not like for the magazine to close. The news should continue. Paul would have wanted this," he said.
 Klebnikov's murder sent shivers through the Moscow journalistic community. It can only be matched by the murders of American hotelier Paul Tatum in 1996, journalist Dmitry Kholodov in 1994 and Listyev in 1995, none of which have been solved.
 "Russia is consistently one of the world's most dangerous places to be a journalist and we call on the Russian authorities to aggressively investigate and prosecute this case," Ann Cooper, executive director of the Committee to Protect Journalists, said in a statement.

TITLE: Khodorkovsky Offers His Shares to Pay Yukos' Tax Debts
AUTHOR: By Catherine Belton

PUBLISHER: Staff Writer
TEXT: MOSCOW - Mikhail Khodorkovsky renewed his offer to surrender his shares to pay off Yukos' mounting tax debts Monday as the oil magnate and his business partner Platon Lebedev returned to a Moscow courtroom cage for the resumption of their fraud and tax evasion trial.
 
Khodorkovsky's direct confirmation of the proposal, made public through his lawyer Anton Drel last week, came as hopes rose again for a last-minute settlement with the government on staving off asset seizures over a $3.4 billion back tax bill.
 Finance Minister Alexei Kudrin on Friday said time had already run out for the oil firm to make a deal on restructuring payments on the tax bill for 2000. But a source close to negotiations said Monday a way for settlement was still open, and an unnamed government source told Interfax it was considering a proposal sent by Yukos on Thursday to pay off up to $8 billion in projected tax debts over a period of three years.
 "There seems to be a certain level of confusion over what the government is saying," the source close to the negotiations said. "Kudrin is saying one thing, but there are certain signs that suggest the government might be open to some kind of settlement."
 He said, however, the terms of any deal were a long way from being clear yet, including both the size of a settlement and how it would potentially be paid.
 Western concern over the legal onslaught against Yukos grew last week as a deadline expired Thursday for payment of the $3.4 billion bill. 
 Ahead of expected asset seizures by court marshals, British Foreign Secretary Jack Straw relayed fears over the potential impact the case could have on the investment climate to his Russian counterpart, Sergei Lavrov, during a visit last week, and German Chancellor Gerhard Schroeder is believed to have raised the issue privately with President Vladimir Putin when he was in Moscow on Thursday. 
 The Organization for Economic Cooperation and Development, meanwhile, issued a scathing report on the Yukos case, claiming that it reflected "highly selective law enforcement" and "the arbitrary exercise of state power."
 Some of those claims appear to be rankling. On Monday, even Defense Minister Sergei Ivanov stepped into the fray. "[The Yukos case] has nothing to do with democracy or human rights," he said at a news conference in London, Interfax reported. "The Yukos case is being decided in line with existing Russian law. The only organ that can make any type of decision is a court of the Russian Federation," he said.
 "Such criminal cases are also to be found in Western democracies, when the owners of companies throw themselves out of windows after they have been accused of something or other," he said.
 Yukos, however, appears to be looking for a more civilized way out of the dispute.
 Company spokesman Alexander Shadrin said Monday that the company had not included Khodorkovsky's proposal in the letter it sent to the government Thursday. But he again refused to comment on the contents of the letter, which, according to a high-level Yukos source cited by Interfax, said the oil firm was ready to pay up to $8 billion in back taxes if it was given three years to do so.
 He said, however, that a new onslaught of bullish statements by court marshals Friday, insisting they would track down Yukos' assets, together with Kudrin's public no to any debt restructuring deal, seemed like a clear rejection of the company's overtures. 
 "It seems that the attacks on Friday were a direct answer to the proposals," he said.
 But some observers saw the apparent lack of any further action on asset seizures by marshals Monday as a sign the government was starting to chew over ways to avoid harming investor confidence by seizing assets.
 Marshals, however, showed little sign of letting Yukos off the hook and used Monday to slap the company with a hefty $235 million charge for non-compliance with a court order.
 The marshals' service asked for a 7 percent fee on the $3.4 billion tax bill to be levied and paid into its account at MDM Bank, Interfax reported. 
 Yukos said it would fight the marshals' fine. 
 The judges presiding over Khodorkovsky's and Lebedev's fraud and tax evasion trial Monday also showed little sign of bending. The Meshchansky court chairwoman, judge Irina Kolesnikova, rejected an appeal by Lebedev's defense team for hearings to be stayed until their client is examined by an independent medical team. She also rejected an appeal for him to be freed on bail during the medical examination.
 Kolesnikova adjourned proceedings until Tuesday to rule on an appeal filed by the defense Monday against Lebedev's detention being in violation of the European Convention on Human Rights.

TITLE: Crimes By Police Irk Consulates

AUTHOR: By Vladimir Kovalev

PUBLISHER: Staff Writer
TEXT: While St. Petersburg diplomatic missions say they are closely monitoring crimes committed by the police against foreigners, foreign tourists and residents complain that consulates can do little to influence the city's law enforcers.
 
"Consulates shrug their shoulders and keep a low profile," St. Petersburg Times reader Walter Denz said in a letter published in the paper last month. 
 "Or they simply complain that they have nobody to talk to. This is wrong: consulates could and should use their privileged position to create the necessary political pressure."
 "Business associations -especially [because] they pretend to represent the international community - should take a much tougher stance," he said.
 Both consulates and business associations disagreed, saying they do all they can, but this is not all that much because the authorities show little initiative in addressing crimes by the police.
 In autumn 2002, the Swedish consulate was one of the most active missions in protesting against the police robbing tourists on city streets.
 In an interview with the major Swedish business daily Dagens Nyheter. Swedish Consul General May Andersson said then: "Watch out for police!" and "Stay in groups of three or more while walking around the city and be particularly careful around Nevsky Prospekt."
 Nowadays, Swedish tourists are not having so many problems, she said.
 "They come to us when they lose their property or passports and definitely we help them in these cases," Andersson said Friday in a telephone interview. "About two years ago we took action [in relation to the police]. There were problems with the police, gypsies and street robberies, but now, I think, the situation is better. I can't remember receiving any complaints [from Swedish citizens] on these matters in recent times."
 The Finnish Consulate was less upbeat, saying the number of crimes by the police against Finns are down slightly, but that the problem is still far from being solved.
 "We receive such complaints on a regular basis, but the situation is better compared to what was happening 1 1/2 years ago," said Karri Lehtonen, the Finnish police representative at the Finnish Consulate, said Monday in a telephone interview.
 "The amount of money people lose varies a lot," he said. "Sometimes it's just 200 euros, sometimes something else. If a passport is lost, we replace it. If a person had a little drink it's very easy to say it was his fault, not the police's" he said.
 Eighteen months ago the consulate received up to four complaints every week, now this number has dropped to one or two complaints a week, Lehtonen said.
 "The police should be helping people who have problems of some sort, but it appears that the police [here] is itself the problem," Lehtonen said.
 He said consulates in St. Petersburg keep sending letters to the Foreign Ministry and law enforcement bodies in the city with requests to tackle crime by the police, but he had no idea what the authorities are doing to change the situation.
 The last such a letter was sent about 1 1/2 months ago, Lehtonen said.
 "The problem does exist and this is a big problem," he said.
 Natalya Kudryavtseva, executive director of the St. Petersburg International Business Association, said the consulates in St. Petersburg do all they can, but their abilities are limited by their diplomatic status. 
 "We had a meeting with consulates on a different question in June and they raised the topic themselves," Kudryavtseva said Monday in a telephone interview. "We know quite well they are really concerned about it." 
 Crimes by police appear to fluctuate - an overwhelming number of cases were reported in 2002 and none in 2003, Kudryavtseva said.
 "This year we've started receiving such complaints again," she said. "I think this is linked to summer and to the 300th anniversary celebrations [last year], when the police was being strictly managed and they probably were a bit wary of committing crimes. 
 "All we can do is just to scream about it. Some might say we should have screamed more loudly, but in order to influence the situation the whole system of the police should be changed. This is not the only problem for the police - the police is altogether a problem," Kudryavtseva said.
 Foreign businessmen say they are afraid of the police more than criminals and often go to the other side of the road if they see an approaching police patrol.
 "I've never had any problems with criminals when walking at night in the central part of St. Petersburg, but with the police I have problems all the time," said an Estonian businessman operating in St. Petersburg, speaking Monday in a telephone interview. He declined to reveal his name.
 "When my phone was stolen [by police] the other night an attempt to call the [police] internal security department resulted in me being advised that I should be more careful in conditions that such cases happen. In any other normal county it is enough to send a police car and arrest them knowing the routes of patrols and so on, but they do nothing," he said.
 "I have a feeling there is a whole business of stealing from foreigners in the police," the businessman said. "I remember having a drink with a City Hall official who said the police cars from Kalininsky district arrive on Friday nights at the biggest hotels in St. Petersburg to earn something. And it is only the Europeans who are exasperated by this because they are used to a police force that helps, while Russians suffer too and just keep silent."
 Kudryavtseva said St. Petersburg consulates are in a process of preparing another approach to authorities on the matter soon. 
 The police press service did not comment on the issue Monday, but an anonymous representative from the St. Petersburg police internal security Department confirmed they receive complaints from foreigners on a regular basis.
 "I have a meeting with a citizen from Azerbaijan, tomorrow I might have had one with a Chinese citizen if I was not on duty. I just can't tell. I'm not responsible for the statistics," the representative said Monday in a telephone interview.

TITLE: City Journalist Not Seen In a Fortnight
AUTHOR: By Irina Titova

PUBLISHER: Staff Writer
TEXT: St. Petersburg journalist Maxim Maximov, 41, special correspondent for the city's Gorod magazine, has been missing since the end of June.
 
Maximov's colleagues went on alert Monday, after the journalist could not be reached on the telephone for days and didn't show up at work, said Sergei Baluyev, editor of Gorod.
 "Maxim was also due to file a story for an upcoming issue of the magazine about this time. but we became concerned before that deadline," Baluyev said. 
 Lev Godovannik, head of the investigation service at St. Petersburg's Agency for Journalistic Investigations, or AJI, where Maximov worked since 1998 until last year, said Maximov was last seen on June 29.
 Baluyev said Maximov was seen on July 1, but that he was not completely sure about the date.
 On July 3, which was Maximov's birthday, his mother called him from Germany but she couldn't reach him anywhere, so she also went on alert, Godovannik said. 
 Both when he worked for AJI and later at Gorod, Maximov used to write about controversial cases, including covering stories about the city's criminal cases.
 Maximov has also been covering the investigation of the 1998 murder of State Duma deputy Galina Starovoitova. 
 He had spent most of his time in recent months at the trial of seven suspects accused of playing a role in Starovoitova's death.
 "Maxim was always looking for topics of special interest," Godovannik said.
 However, Godovannik said the agency, which started its own investigation simultaneously with the city police, had no proof that Maximov's disappearance was connected to his professional activities.
 Godovannik said Maximov was known as "a super punctual person", who never had problems with health or alcohol, and that he wouldn't simply leave for a sudden vacation without telling anyone or warning people at work.
 Baluyev said Maximov went missing together with his car - a black Ford Escort.
 Oleg Panfilov, director of the Center for Journalism in Extreme Situations, said Monday in a telephone interview from Moscow that he also didn't have information that Maximov's disappearance is connected to his professional duties.
 "Unfortunately, we live in a criminal country, where murders just happen in the streets," Panfilov said. 
 And it's not always that people disappear only because of their professional activities," he added.
 Since 1995 at least nine journalists are listed in Russia as having disappeared, he said.
 Maximov's colleagues from AJI and relatives ask anyone who has information about Maximov to call 950-21-45. Anonymity is guaranteed.

TITLE: Chivalry on Show at Knights' Meet
AUTHOR: By Ruth Hetherington

PUBLISHER: Special to The St. Petersburg Times
TEXT: PRIOZERSK, Leningrad Oblast - One of the disadvantages of being a 21st century knight is that without your trusty steed you may find yourself stranded and hostage to technology.
 
Several dozen knights missed Friday's afternoon activities at the Knights' Tournament in Priozersk, 180 kilometers north of St. Petersburg, because their train from St. Petersburg was cancelled.
 However, the mood was ebullient in the 9th century fortress of Korela, as scores of enthusiasts gathered for a two-day celebration of medieval European weaponry and martial arts, which culminated in Saturday's re-enactment of the storming of the fortress by Russian soldiers in 1295.
 "It's difficult to say which aspect is more important to us - history or martial arts. They're inseparable: they're both important and enjoyable," said Alexey Vaneyev, 24, a law student from St. Petersburg, who was going by his club name Sir Axei.
 Vladmir Nasida, 24, a builder from St. Petersburg and member of the Knights of the Round Table club, said he enjoys studying medieval European and Russia history most, while for Pavel Kirillov, 24, also from St. Petersburg, "this is a sport. It's a Russian extreme sport."
 The crowd cheered and heckled as the knights, heavily padded and wearing chain mail and helmets, took it in turns to display their swordsmanship and <i>sang-froid. </i>Each pair battled it out for 2 minutes on a raised stage in the center of the fortress.
 The main rules are that the knights must avoid hitting their opponents' hands, feet and groin, and that the blows must be hard. The knights willingly oblige, but it's not only the fighting bouts and groans of pain that are authentic.
 Klim Zhukov, 27, a historian from St. Petersburg and one of the organizers of the tournament, said historical accuracy is essential when it comes to costumes and weapons. 
 &quot;We research original medieval sources and descriptions of tournaments. We make all our own weapons, chain mail and armor ourselves with the help of blacksmiths and we pay special attention to the weapon's construction, appearance, the materials we use.&quot;
 The Association of European Medieval Martial Arts, or AESBI, the main organizer of the festival, shows just how seriously these boys take their history and their fashion.
 All costumes must be made of natural materials. No modern clothes or shoes are permitted. A knight's weapons and costume should be from the same region and must not span a period of more than 50 years.
 Unsurprisingly, given the level of physical strength required, there were no budding Joan of Arcs to be seen, although there were quite a few far from distressed damsels wafting around in full medieval dress, clutching cans of beer and bottles of Pepsi. The first such tournaments were held in Russia in the early '90s. Zhukov and Sergei Myasishchev founded the AESBI in St. Petersburg in 1994.
 &quot;We are based in St. Petersburg but we have partners all over Russia, from Vladivostok to Kaliningrad. We have international contacts too: in France, Poland, the Czech Republic - all over Europe,&quot; Zhukov said.
 Lounging in the sun, a few contenders for best-dressed knight award struggled to define what attracted them to this intriguing mix of fancy dress and serious history.
 A young Livonian knight stepped in chivalrously to save the day. &quot;A man without a hobby is not a real man,&quot; he said solemnly. How very medieval.

TITLE: IN BRIEF
TEXT: <b>Murder Trial Adjourned
 </b>

ST. PETERSBURG (SPT) -<br> The St. Petersburg city court will adjourn the trial of suspects in the 1998 murder of State Duma Deputy Galina Starovoitova until Aug. 23 while staff take vacations, Interfax reported Friday.
 The defense plans to present its case after the break, the report said. Defense lawyers have not cross-interrogated Alexei Voronin, one of those on trial who recently testified.
 "The defense has its own tactic of presenting evidence and we plan to ask our questions to prosecution witnesses and Voronin after the testimonies of our defendants," Interfax quoted lawyer Yevgeny Rusakov as saying.
 
 
<b>Deserter Caught
 </b>

ST. PETERSBURG (SPT) - A soldier who allegedly shot a sergeant and escaped from his military base located in Leningrad Oblast early Sunday morning, has been caught, Interfax reported Monday, citing the local office of the Emergency Situations Ministry.
 The soldier, Ruslan Bakhayev, left the military base located in Murino settlement about 4 a.m. Sunday.
 While trying to leave Bakhayev shot a sergeant, who tried to detain him, the report said. The sergeant died on his way to the hospital.
 
 
<b>Appeal Due in August
 </b>

ST. PETERSBURG (SPT) -<br> A Supreme Court hearing of an appeal against a decision to invalidate the results of the State Duma elections in the city's electoral District No. 207 on March 14 is scheduled Aug. 25, Interfax reported Monday, citing the City Prosecutor's Office.
 The appeal was filed by Alexander Morozov, who had been elected to the State Duma before the city court ruled last month that the federal election law was violated on March 14. 
 His competitors Sergei Andreyev, Anna Markova, Elvira Sharova and a voter Alexander Anikin had complained that electoral laws were broken during the election. 



TITLE: Ice Cream Companies Attempt Market Development
AUTHOR: By Sophia Kornienko

PUBLISHER: Staff Writer
TEXT: The Russian ice cream market remains the slowest in the dairy industry, growing by only 4 percent annually.
 
There are about 300 ice cream manufacturers operating in the country, but few of them are competitive due to the market's high entrance barriers, said Alexander Kudryashev, marketing manager at St. Petersburg's leading ice cream producer Petrokholod. 
 The multiple small manufacturers across the country lack the finance to invest into the expensive equipment, he said. 
 In Russia, ice cream is an explicitly seasonal product, Kudryashev said, and manufacturers have to find other products to occupy their output capacity during the cold winter. Compared to an average American, an average Russian eats five times less ice cream per year. 
 In 2003, 385 tons of ice cream were produced in Russia, which is only 14 thousand tons more than the total volume in 2002, RosBusinessConsulting wrote in June. To help the market develop more dynamically, several of the market's leaders should consolidate the scattered ice cream producers into strong holdings, RosBusinessConsulting reported. The country is going to see such restructuring of the ice cream market very soon, experts say.
 The industry's total output capacity across the country amounts to 800 thousand tons of ice cream per year, reported the Russian Union of Ice Cream Manufacturers. The country's leading producers are Russkiy Kholod (9 percent), Inmarko (8.2 percent), Nestle (5.4 percent), Talosto (4.8 percent) and Ice Phili (4.5 percent), the Union reported.
 In Kudryashev's estimate, Petrokholod accounts for about 25 percent of the Northwest ice cream market. The three other regional leaders are Talosto and Khladkombinat 1 - literally &quot;Ice Cream Factory No. 1&quot;-- producing ice cream locally, and Nestle, importing from Moscow region. Increasingly popular with St. Petersburg's consumers are Petrozavodsk-based Slavmo and Inmarko, which import products from the Urals. 
 The national number-one leader Russkiy Kholod does not have a good position in the Northwest, analysts say.
 
 <strong>
LATEST HITS
 </strong>The key to secure your position in this market is constant diversification of the products, Kudryashev said. Because companies can lead in one type of ice cream and fall behind in another, it is difficult to define their market shares, Kudryashev said, adding that Petrokholod's hit is chocolate-coated round ice cream bars, such as the classic Dasha and Mitya brands.
 
Besides endless brand diversification, local companies follow different priorities in business strategies. For example, Talosto, the Volkhov-based manufacturer of Zolotoy Slitok and Oasis bars, is investing heavily in advertisement. 
 In 2004 alone, Talosto invested $1 million into developing new sorts of ice cream this summer season. Among the company's recent innovations are Ego Ice &quot;for eating at home,&quot; frozen yogurt, which is a novelty to the Russian tongue, and Mini Bikini - a pack of petit chocolate coated caramel cream bars. 
 Talosto produces 3,000 tons of ice cream per month, which makes the company the largest manufacturer in the country. The company's supplements its ice cream manufacturing with a big pelemeni production line, and other frozen foods. 
 Meanwhile Petrokholod, based at a 1946 former state-owned ice cream factory, keeps to the more traditional, but also the more natural recipes. &quot;We use only cow fats, not coconut or other fats,&quot; Kudryashev said.
 
 <strong>
GENETICALLY MODIFIED?
 </strong>In May, Talosto Products and Ice Phili were included in a list of 127 companies accused by Greenpeace Russia of possibly using genetically modified (GM) ingredients in the organization's new consumer handbook. &quot;The list only reflects the policy the company follows in terms of GM ingredients, but it does not guarantee the presence or absence of those ingredients in the company's products,&quot; Greenpeace representatives told Gazeta. 
 
At Talosto, they say the information on GM ingredients is false. &quot;We made an official statement on the absence of GM ingredients in our products back in February, and we did provide the information on the controlling authorities and the additional checks initiated after the first accusations against us had appeared in the media. We are ready to certify again that our company does not use GM ingredients,&quot; Talosto's representative said.
 &quot;Until Russia develops a reliable system to control the use of GM ingredients in food products, the consumers literally won't know what they are eating,&quot; said Greenpeace project coordinator, Natalia Oliferenko.
 However, many Russians don't only neglect the conflicts around the new ingredients, but even the amount of consumed calories. The most popular types of ice cream in Russia remain the ones with the highest fat content - from 10 to 15 percent. 
 ice cream was not always fatty. It was prepared from snow and fruit juices by the Chinese, who invented the product 5,000 years ago. For centuries afterwards, ice cream remained a luxury for the nobles. It became a mass product only in 18th century America.
 In today's Russia, ice cream is most affordable in the cash-and-carry giant superstores and discount shops. Street vendors charge 25 percent more.
 
 <strong>
NEWCOMERS
 </strong>Russia's shaping ice cream market has much room for newcomers, and foreign companies, such as Unilever, have already showed interest in the country. 
 
&quot;Unilever can easily purchase a couple of Russian companies and begin expanding to the local market,&quot; Alexander Saulin, marketing director at Russkiy Kholod told RosBusinessConsulting. &quot;Russkiy Kholod would naturally form the tastiest bite for Unilever, but we are not prepared to sell our business,&quot; Saulin said. 
 In Saulin's opinion ice cream manufacturers will resume negotiating merger deals after the summer season is over, but those negotiations are likely to concern purchases, not partnerships. 
 &quot;Many ice cream factories today resemble debutantes looking for a sugar-daddy, but most of them are pricing themselves too high,&quot; Saulin said. 
 Meanwhile Petrokholod's Kudryashev says the potential newcomers are halted by Russia's still unpredictable political environment. &quot;Unilever and other western players are going to wait until the next round of presidential elections, to see what happens after Putin's current term is over. It does not make sense to enter the market for only three years,&quot; Kudryashev said.

TITLE: Tap Water Dangers or a Costly Choice of Bottled Water?
AUTHOR: By Simone Kozuharov

PUBLISHER: Staff Writer
TEXT: &quot;Don't drink the water!&quot;
 
That's probably one of the first warnings tourists get from overly-helpful friends and family before travelling to Russia and especially to St. Petersburg.
 Russia's pipes are notoriously old and are known to disperse water of various colors, ranging from dingy yellow to rusty brown. 
 In fact, everyone's hot water is shut off for about three weeks on an annual basis while the water authorities clean the pipes. But what about the other 49 weeks of the year?
 Drinking Russian tap water is generally not recommended. Drinking St. Petersburg tap water is practically prohibited. 
 Tourists coming to St. Petersburg are advised to drink only bottled water, although Russians tend to boil tap water for drinking. Many tourists are even instructed to brush their teeth with bottled water to avoid exposure to Giardia.
 Giardia is a parasite known to live in St. Petersburg's tap water and it can have disastrous effects on the stomach. Besides diarrhea, it can also result in vomiting and other unpleasant side effects.
 &quot;I know that we've treated a number of people in St. Petersburg, of expatriates, for Giardia,&quot; Kurt Stahl, general director of the British American Clinic, said. &quot;For this reason, I personally do not feel comfortable with drinking tap water.&quot;
 The U.K. Trade and Investment web site, sponsored by the British government, reminds travelers that &quot;the water supply in [Russian] cities is drinkable but the color, smell and taste are often unpleasant - usually due to a high iron content. It is advisable to drink bottled water rather than tap water. It is definitely unsafe to drink the tap water in St. Petersburg because of the presence of the diarrhea-causing parasite Giardia lamblia in the water supply.&quot; 
 The U.S. Centers for Disease Control and Prevention also warn tourists about the potential health threats in tap water throughout the CIS.
 &quot;Drink only bottled or boiled water, or carbonated (bubbly) drinks in cans or bottles,&quot; the CDC warned. &quot;Avoid tap water, fountain drinks and ice cubes. If this is not possible, make water safer by both filtering through an 'absolute 1-micron or less' filter and adding iodine tablets to the filtered water.&quot;
 The site urges travelers to &quot;boil it, cook it, peel it or forget it.&quot; 
 EuroMed Clinic said in a statement that parasites such as amoebae and Giardia organism are also a significant source of disease. &quot;They usually inhabit contaminated water sources and so-called 'fresh' vegetables, which may need to be specifically disinfected.&quot;
 Parasites are not the only problem. Chemicals and metals are also an issue that has raised concern.
 &quot;Reports have shown quantities of chlorine and metals in the water, probably from older pipes,&quot; EuroMed noted. &quot;Avoid tap water, fountain drinks and ice cubes in restaurants.&quot;
 The majority of Russians just boil their water. However, a simple boil for a minute or two is far below the necessary 20 minutes EuroMed recommends to its patients.
 However, most experts stressed that the best choice for water consumption is bottled water. There are a bevy of choices on the Russian shelves, including the well-known and expensive brands like Vittel and Evian. 
 Both the Coca-Cola Bottling Company and Pepsi Co. put out domestic brands of purified drinking water. Coca-Cola's is Bon Aqua, almost as visible on Russian shelves, in kiosks and markets as Pepsi's brand, Aqua Minerale, which seems to be everywhere. 
 According to Comcon, a leading market and media research group, a study in 2002 showed that only about 51 percent of St. Petersburg locals say they drink bottled water at least once every three months, while about 57 percent of Russians in general consume bottled water just as often.
 About 4.5 percent of those living in St. Petersburg buy bottled water in the .33-liter size plastic bottles, the variants most often found in kiosks or ice cream booths. But only 3.5 percent of Russians in general buy the same size bottles. 
 Nearly 60 percent of Russians buy 1.5-liter bottles at least once every three months. But less than half of that number of city residents, about 28 percent, do the same. 
 Pepsi's Aqua Minerale takes first place among city population and Russians in general. About 36 percent of Russians buy Aqua Minerale at least once every three months. 
 The brand enjoys even more popularity in St. Petersburg, where about 57 percent of consumers buy it at least once every three months.
 Coca-Cola's Bon Aqua comes in second place, with about 25 percent of Russians buying it over the same period of time. About 40 percent of city residents buy it at least once every three months.
 Essentuki and Borjomi compete for third place, while well-known upscale brands like Perrier, Evian and Vittel are found closer to the bottom of Comcon's list.
 Pepsi launched their Aqua Minerale brand domestically in 2000. 
 &quot;Aqua Minerale has been increasing its market share and became a leader for the domestic bottled and mineral water market,&quot; Pepsi Co. said in a statement, citing a survey by ACNielsen.
 Their most popular sizes are the 1.5, 2 and 5-liter bottles, although the brand is available in several other sizes and packagings.
 Pepsi attributes Aqua Minerale's success in Russia to a &quot;stable and quality product ... [an] appropriate advertising campaign and product availability in retail stores.&quot;
 Coca-Cola introduced Bon Aqua to the Russian market in 1994 and sales have increased since that time, Coca-Cola said in a statement. 
 &quot;Traditionally, the 2-liter and .5-liter [bottles] are the most popular packs, though this very much depends on seasonality and the distribution channel,&quot; Coca-Cola noted.

TITLE: Kasyanov's Bank Proposal Meets Kudrin's Resistance
AUTHOR: By Guy Faulconbridge

PUBLISHER: Staff Writer
TEXT: MOSCOW - Finance Minister Alexei Kudrin wants the government to bury a proposal by his former boss to create a multi-billion-dollar investment bank, media reported Monday. 
 
Former prime minister Mikhail Kasyanov last month said he had sent a proposal to President Vladimir Putin asking for permission to establish a bank that would fund major infrastructure projects like building new pipelines and railways.
 But the day Kasyanov went public with the proposal, which he claimed Putin supported, Kudrin sent a letter to Prime Minister Mikhail Fradkov urging him to derail the project, according to a copy of the letter printed in Nezavisimaya Gazeta.
 Kudrin said in the letter that the project would weaken Russia's influence in former Soviet bloc countries by encouraging direct ties between Central and Eastern nations and members of the Commonwealth of Independent States.
 Kudrin also took issue with Kasyanov's proposal to base the new institution on two existing but long dormant banks - the International Investment Bank and the International Bank of Economic Cooperation, both of which once handled the accounts of COMECON, the former Soviet council set up to promote economic integration with socialist countries. 
 Neither bank is experienced enough to handle the kind of projects Kasyanov is proposing, Kudrin said in the letter.
 Neither the Finance Ministry nor the government would comment on the reports Monday. 
 At the time of Kasyanov's announcement, which was the first he made about his future work plans since being forced to resign in February, some political analysts said it appeared that the new bank would be Kasyanov's reward for exiting the government quietly after seven years in the White House.
 But judging by the government's reaction, that no longer appears to be the case, said Alexei Mukhin, director of the Center for Political Information.
 &quot;Kasyanov's proposal has been sunk, at least for the time being,&quot; Mukhin said. &quot;In a sense, the Kremlin has devalued Kasyanov.&quot;
 Kasyanov said the new lender could finance projects worth up to $40 billion, but it would need up to $6 billion in start-up capital, a third of which could come from Russia. European and CIS countries could also become shareholders, he said.
 &quot;Kasyanov felt he had been forgotten, so he came up with this very ambitious and very high profile project,&quot; said Mukhin. &quot;But the Kremlin's reaction ... [is] that it is too early.&quot;
 Kasyanov's personal spokeswoman, Tatiana Razbash, refuted that claim.
 &quot;To say that Kasyanov has lost is simply laughable - the proposal is still in the government and is being worked out,&quot; she said by telephone.
 &quot;[Kasyanov] outlined a proposal that would help attract investments into the economy, into the major infrastructure projects that are needed,&quot; Razbash said.
 Interfax quoted an unnamed source in the government as saying Monday that the Cabinet is considering both Kasaynov's proposal and Kudrin's opposition to it.
 The government has said that in order to sustain current levels of economic growth, Russia needs to spend about $1 trillion over the next 20 years on expanding and modernizing its railroad, highways and other key infrastructure.

TITLE: IN BRIEF
TEXT: <b>Alpla Builds in Oblast
 </b>

ST. PETERSBURG (SPT) - Austrian manufacturer Alpla plans to invest about $15 million in building a factory for plastic packaging production in the Leningrad Oblast, Vedomosti reported Monday.
 The factory is planned to be built in an industrial area of the town of Tosno by the first quarter of 2005. 
 According to the press service of the oblast administration, the factory will produce plastic bottles, containers as well as molds for other products. 
 
 
<b>Gref Urges Donations
 </b>

ST. PETERSBURG (SPT) - Economic development and trade minister German Gref encouraged businesses to be active in demonstrating "social responsibility" in sponsoring the renovation of the state park-and-palace ensemble Oranienbaum, during his visit to the city last week, Kommersant reported Monday. 
 $2 million have already been received by the Restoration Fund, which is headed by Governor Valenitna Matviyenko. The restoration of Oranienbaum is estimated to cost a total of $100 million. 
 
 
<b>Sibneft's $481M Tax
 </b>

BAKU (SPT) - Audit office chief Sergei Stepashin said checks this year revealed that Sibneft had avoided $481 million in tax, Reuters reported. 
 "They avoided taxes, but this was unfortunately legal," he said during a visit to the Azerbaijani capital Baku on Saturday. "Today that law has been abolished... but after having lost huge amounts of money that could have contributed to the country's budget," he said. 
 Russia launched a crackdown last year on investment-linked tax write-offs offered by certain regions. Companies could channel funds through offshore areas and save huge amounts of money in a practice sharply criticized by President Vladimir Putin. The tax breaks were abolished from Jan. 1 this year.
 
 
<b>Siemens Eyes OMZ
 </b>

FRANKFURT (Reuters) - German electronics and engineering group Siemens AG is in talks to take a major stake in Russia's biggest turbine maker Power Machines, business daily Handelsblatt reported Monday. 
 No one at Siemens or Power Machines was immediately available to comment on the report. 
 The newspaper quoted a Siemens spokesman as saying that the German group, whose products range from light bulbs and mobile phones to turbines and nuclear power plants, was interested in raising its five percent stake in Power Machines. 
 Siemens, which has a multi-billion-euro war chest for acquisitions, has repeatedly said it would keep its eyes open for potential purchases. Earlier this month, Power Machines said it would not merge with machinery giant OMZ after OMZ elected no Power Machines officials to its board. 



TITLE: Canadian Consul Tells Businesses: Go North
AUTHOR: By Simone Kozuharov

PUBLISHER: Staff Writer
TEXT: Anna Biolik, the Consul General of Canada in St. Petersburg, finishes her term at the end of July, after which she will return to Canada to spend time with her family and then head abroad for another posting at an as yet unknown location.
 
Biolik's parents immigrated to Canada from Poland after WWII. Half a century later, their Canada-born daughter was back in Eastern Europe to spend three years here as a diplomat.
 Biolik, now looks back over her past three years here and wonders where the time has gone. &quot;It went so fast, it's unbelievable,&quot; she said. 
 But St. Petersburg has left its mark on Biolik, who speaks Russian impressively.
 &quot;Its absolutely an exciting moment right now to work in St. Petersburg and in North-West Russia,&quot; Biolik said. &quot;Working in St. Petersburg, you have a chance to work on things which are not necessarily developed on the official level. You can stimulate work between people.&quot;
 One thing Russian and Canadian people have in common is their northern geography. The frosty tundra is a vast expanse of natural resources and untapped industry. Both Canada and Russia have the potential to cooperate on &quot;sustainable development&quot; of these regions, Biolik said. 
 &quot;These northern territories are not very well populated,&quot; she said. &quot;However that doesn't mean that we shouldn't pay more attention to the needs of the local population and I think that both countries are trying to do something about it.&quot;
 Biolik noted that the time for cooperation is now, as Russia takes over as chair of the Arctic Council in September. She ticked off a list of projects underway and spoke passionately about the potential for these frozen, yet beautiful regions.
 &quot;On a bilateral basis we started to cooperate very seriously with the partners in North-West Russia. Among our partners we can certainly count the Russian specialists from the Russian Institute of Northern Peoples,&quot; she said. 
 Cooperation has also developed between the Russian scientists and experts from the Russian Academy of Science, the Institute of the Arctic &amp; Antarctic, the Museum of the Arctic &amp; Antarctic and Kunstkamera, Biolik said.
 Some projects are in the preliminary stages, but Canada is eager to cooperate and share its experience in dealing with northern issues, she said.
 &quot;Developing something quite extensive takes time, but certainly the very preliminary discussions that we have already undertaken, demonstrate that there is a very strong interest from both sides,&quot; Biolik said.
 In addition, Biolik said the Canadians have a keen interest in business cooperation as well.
 &quot;We would like to develop some concrete initiatives in the area of business. And that would include probably something like a concept of a Northern chamber of commerce where we could possibly think about developing a network of businesses...to share their experience in terms of doing business, promoting their services,&quot; she said. &quot;It would be like an exercise frankly and both sides always need more expertise.&quot; 
 She enumerated a bevy of joint projects or possible points of cooperation, including northern transportation, northern mail delivery, health services and distant education.
 &quot;We all know in Canada how far everything is when we start to talk about the north of our country,&quot; she said.
 Regardless, vital necessities like medical and educational services can not be compromised and a northern location is not an excuse for lack of either, she said.
 &quot;Telehealth could be one of the major developments to help people appreciate living in these conditions,&quot; she said. 
 Telehealth provides &quot;direct connections with hospitals and surgery rooms. And a doctor who will be operating in Murmansk could get the full background and help in terms of conducting surgery from specialists in Moscow, Samara or wherever the place is where you would have the center of excellence and expertise,&quot; Biolik explained. 
 &quot;Not every single doctor who is an expert in eye surgery for instance can live in the [country's] north. However, when you have the right type of technology helping you connect these people, you can do a lot,&quot; she said.
 Likewise, building schools offering quality education in sparsely populated areas presents a formidable challenge. Distance education provides northern citizens the opportunity to study and receive a respected degree, without having to abandon their northern locale, Biolik said.
 Biolik objects to the idea that instead of facing the challenges of living in the north people should just live elsewhere. &quot;That's not the answer to this question,&quot; she said.
 &quot;First of all, it is their natural habitat and secondly, you also have things to do in the north because of the tremendous reservoir of natural resources. You want to have your own population being able to work in these conditions and to continue the economic development of these parts of your country,&quot; Biolik said.
 Biolik's knowledge and dedication to the northern issues facing both Russia and Canada is clear in her enthusiasm and involvement here in St. Petersburg. She seems to have a genuine affection for the Northern Capital and talks about certain aspects of the city with a gleam in her eye.
 &quot;The light in the city is absolutely fascinating,&quot; Biolik said. &quot;It offers this wonderful feeling during the winter - even when the sun is so low you don't think that you would have a lot of light, the light is very subtle, very kind of homey, very nice and I love it. And the combination with the white snow on the streets is absolutely beautiful.&quot;
 Biolik has lived here with her husband, Terry Hargreaves, who retired after a nearly 30-year career with the Canadian Broadcasting Corporation (CBC). 
 &quot;He has enjoyed - extremely - this particular assignment,&quot; she said. 
 Biolik also has two step-sons in university, who have visited St. Petersburg on a regular basis since Biolik's posting here - her first as mission head.
 &quot;Frankly, this is the first time I am the head of the mission and the level of responsibility is very different, but extremely interesting,&quot; she said. &quot;You have a chance to work on issues which go from political to trade development, from trade development to northern issues via everything which is called public diplomacy. Its absolutely great.&quot;
 Biolik's co-workers at the embassy have enjoyed working with her just as much as she has enjoyed her time here.
 &quot;[Biolik] is my fourth consul general,&quot; said Margarita Sandal, a commercial officer with the consulate. &quot;I remember each of them but she's very special because of her heart - she has an extremely big heart.&quot;

TITLE: European Shares Slip On Low Earnings, Oil
PUBLISHER: Combined Reports
TEXT: LONDON -European shares eased Monday as downgrades in semiconductors, continuing high crude oil prices and nervousness before top earnings later in the week kept investors on edge. 
 
In the auto sector, German magazine Der Spiegel reported Saturday that Europe's largest carmaker, Volkswagen will miss its profit goal for the current year, sending the stock down 1.5 percent to 32.7 euros. 
 Britain's Marks &amp; Spencer said it would return $4.26 billion to investors as it spelled out a range of measures to win shareholder loyalty in the face of a bid from tycoon Philip Green. M&amp;S Chief Executive Stuart Rose promised a return to core values and said a tender offer would give shareholders value equivalent to a cash return of 100 pounds per share. 
 However, shares in the retailer were unchanged at 368 pence after an initial dip. &quot;I wonder whether this is enough. I think it's probably low to middle of the expected range,&quot; said Rebecca McLellan of BNP Paribas bank. By 0709 GMT, the FTSE Eurotop 300 index was off 0.2 percent at 983 points, while the narrower DJ Euro Stoxx 50 index was down 0.24 percent at 2,769 points. 
 The technology sector was a focus after Merrill Lynch investment bank cut its stance on the semiconductor sector to &quot;underweight&quot; from &quot;overweight,&quot; saying it did not expect a strong enough build in inventory to maintain earnings forecasts. 
 &quot;We would not sell into any resulting share price strength,&quot; Merrill analysts said in a research note. Among the individual chip groups, Merrill cut its ratings on the stocks of Britain's ARM, Dutch ASML, German Infineon and Franco-Italian STM microelectronics. 
 ARM fell 2.4 percent, ASML was off 2 percent, Infineon down 1.4 percent and STM shed 1.1 percent. The earnings season starts to gear up this week with results due from Philips Electronics on Tuesday and from Swedish-Japanese mobile-phone joint venture Sony Ericsson and handset giant Nokia on Thursday. In the United States, chip bellwether Intel reports on Tuesday. 
 NYMEX crude oil prices fell 1 percent early Monday, pressured by weekend comments from OPEC ministers that the cartel will raise output limits on Aug. 1 and may consider further rises if prices stay high. U.S. light crude dropped 33 cents to $39.63 a barrel, though still near the $40 level that has triggered concerns about inflation and the economy. 
 In New York on Friday, the Dow Jones industrial average ended up 0.41 percent at 10,213.22 points, and the tech-laden Nasdaq Composite finished up 0.57 percent at 1,946.33 points. No major U.S. economic figures were due Monday as investors look to key guidance this week from U.S. June retail sales figures Wednesday and from the U.S. producer price index a day later.
 <i>
 (Reuters, AP) </i>

TITLE: Strong Economy Masks Political Ineptitude
AUTHOR: By Anders &aring;slund 

TEXT: President Vladimir Putin has had a fantastic run. The economy has grown by 6.5 percent per year for the last half-decade. Macroeconomic problems have been resolved in resolute fashion. Putin routed his opponents in both the recent parliamentary and presidential elections. Oligarchs and regional governors have been cowed, and the media have been transformed into a choir that sings hymns of praise. Few political leaders can boast such a successful first term.
 
Alas, Putin's second term is not likely to be reminiscent of his first term because he has altered the nature of Russian politics. His first term was characterized by a balance of power between the oligarchs and <i>siloviki</i>, as well as between the federal government and regional governors. Although ever more controlled, substantial independent media voices still existed. 
 Thanks to open competition the best idea usually won. Government bodies made many wild decisions, but they tended to be checked and reversed. Russia had become a stable and predictable society because of an intricate system of checks and balances, which helped make Putin enormously popular. He could take credit for all the good and blame the bad on others.
 Now everything has changed. Putin has successfully concentrated extraordinary power in his hands. His chief of staff and prime minister do not dare to do anything without a direct command from him. Both chambers of parliament have lost all independence, so they have to be instructed as well. Even the regional governors are subdued. Most checks and balances have fallen by the wayside. With merciless logic, the problems political science tells us are caused by over-centralization of power are rapidly emerging.
 The fundamental problem is that the president has to make all significant decisions himself. He has made clear he wants it that way, and all senior officials obediently delegate their decisions to him. But one person cannot make all the decisions, and the outcome is a government in stalemate. 
 As a result, not only the long-heralded administrative reform, but virtually all structural reforms have come to a halt. The current bank crisis illustrates how a limited problem becomes a big headache when the authorities do not act in a timely manner. People talk longingly about former chief of staff Alexander Voloshin and former Prime Minister Mikhail Kasyanov, who could make decisions.
 Not only the federal government, but also the regional governors have lost power. Under Boris Yeltsin, they ruled unimpeded and even organized strikes to blackmail the federal government. In Putin's first term, a fruitful balance reigned, but it has been jeopardized. Governors have also started delegating their decisions to the president. Recently, Russia has seen a couple of minor, but persistent, strikes, and the weakened governors have been reluctant to resolve them, making them national concerns. After most checks and balances have been disbanded, nothing can discipline the victorious state organs, notably the security services, from enjoying the fruits of corruption. Extortion by law enforcement and central state bodies appears to have reached a new peak.
 As the most important decisions hinge on the caprices of the president, Russia has lost its relative transparency and predictability. The stock market, especially the price of Yukos, illustrates the ensuing vagaries.
 In his first term, Putin surprised many by being a consummate politician, nurturing his enigma, appealing to nearly everybody and playing multiple interest groups off against one another. Now he has abandoned all that. He appears not to like politics. His idea of consolidating power is that of a bureaucrat striving for absolute control, rather than a politician balancing different interest groups. United Russia is a party of bureaucrats rather than of politicians. Putin does not even use a press spokesman, compelling himself to make all statements and depriving himself of plausible deniability. His KGB roots are all too apparent. Bred to distrust everybody, he only trusts himself.
 For Putin, the result is nothing but unfortunate. His enigma has evaporated as he has overexposed himself. Because of his evident and overwhelming power, nobody but him is likely to be blamed. Thanks to their prior independence, Russian media have enjoyed great popular credibility, but this will soon be lost under increasing state control. The public pressure on Putin to perform will be all the greater, since he will have to justify himself with economic or national achievements, as his ability to deliver diminishes under these new conditions.
 The problems Putin now faces are largely of his own making. The starkest example is the Yukos affair, which threatens to become the hallmark of his second term. His motives appear to be political mixed with personal vengeance, while others desire to get their hands on Yukos' assets. This scandal has made his judicial reform such a joke that he wisely avoided mentioning it in his annual state of the nation address. Putin does not seem to know how to get out of this mess, leaving him with little choice but to bankrupt one of Russia's biggest and best companies. To avoid looking like a robber, he might even be forced to nationalize it, thus endangering Russia's highly successful oil industry revival, driven by competing private oil companies.
 The new Russian malaise is naturally being reflected in the foreign media, harming Russia's international reputation, which Putin did so much to boost in his first term. 
 Such is the situation before August, a month that usually brings disaster to Russia, as most senior officials are on holiday. Either petty crooks try a trick, or nobody is in place to handle an unexpected crisis. Russia appears unlikely to avoid serious crises with such a dysfunctional government, but it is difficult to predict what sort of crisis people should be worrying about, because the most unexpected crisis usually becomes the most serious.
 Putin's team has learned the essence of Western economics admirably. Now, it needs to take a crash course in political science.
 
 <i>Anders &aring;slund, director of the Russian and Eurasian Program at the Carnegie Endowment for International Peace, contributed this comment to The St. Petersburg Times.
 </i>

TITLE: Klebnikov Murder Blots Russia's Image
TEXT: The murder of Forbes Russia editor Paul Klebnikov last Friday should serve as a wake-up call to all those who believe, as he did, that Russia has changed.
 
When the magazine was launched in April, Klebnikov wrote that its arrival in Russia was &quot;one sign that Russian business has reached a new, more civilized stage of development.&quot;
 Well, he was wrong, and it should not have taken the murder of a respected American investigative journalist to drive this message home.
 Perhaps we have simply become too used to the idea that businessmen need bodyguards, and that those who step on the toes of business interests, be they government officials or journalists, are occasionally gunned down in the streets.
 When Vladimir Putin came to power in March 2000 he promised to establish not just the rule of law but the dictatorship of the law.
 In a piece written for these pages a year later, Klebnikov urged Putin to establish the rule of law quickly, saying that only then could democracy and free-market capitalism begin to evolve.
 In retrospect, Klebnikov's words have new power:
 &quot;Yes, the laws on the Russian books are highly imperfect, but that does not mean that the law shouldn't be enforced at all. The Russian government could start with enforcing one of the simplest laws, the one against murder. Every year many top businessmen, government officials and civic leaders are assassinated. Yet, the police solve only a fraction of these contract killings. There simply is no political will to enforce the law.&quot;
 Since then, little has changed. In October 2002, Magadan Governor Valentin Tsvetkov was shot dead in broad daylight on Novy Arbat. In April 2003, liberal Duma Deputy Sergei Yushenkov was killed outside his home. That June, two top officials at Almaz-Antei, one of the biggest defense concerns, were shot to death. In April of this year, Georgy Tal, the former head of the Federal Bankruptcy Service, was murdered.
 These are just some of the more high-profile killings in Moscow alone, and even in such cases the killers are rarely brought to justice.
 Klebnikov, in concluding his opinion piece, said that the West should judge Putin's administration by whether it was strengthening the rule of law, with bringing murderers to justice a fundamental part of this.
 &quot;Is the wave of gangsterism subsiding? Are small businesses flourishing? Are civic associations multiplying? These are the yardsticks by which we will be able to tell whether Russia is moving toward democracy,&quot; he wrote more than three years ago.
 Klebnikov's own murder is a tragic confirmation of how little has been achieved and how much still needs to be done.

TITLE: It's Not What You Do, But the Way You Do It
AUTHOR: By Vladimir Gryaznevich

TEXT: Two-thirds of managers of 127 large Russian companies surveyed conducted by the Association of Managers and Kommersant believe there is a national banking crisis. 
 
This number comes as no great surprise. One after the other, well-known Russian banks are failing. Troubles began at Guta-Bank after the survey, and similar rumors started about Alfa-Bank. These are the largest banks in the country. The reason for what has happened, according to 57.2 percent of the businessmen in the poll, is the &quot;clumsy work of individual officials in the fight against corrupt banks, which arouses a general mistrust in the banking system as a whole.&quot;
 It is significant that businessmen are dissatisfied with the &quot;clumsy work&quot; of officials in particular, and not with the unfair persecution (in other words, style) used by the authorities or the direction of the authorities' activities. Nobody disputes that the situation involving corrupt banks must be sorted out, but the majority cannot come up with any methods. The medicine is worse than the illness itself; if corrupt banks are slowing down the development of the banking system, then clumsy methods employed to come to terms with them are destroying it completely. 
 In a degree thesis of Olga Shirinyan, a final-year student of the St Petersburg State University, it has been shown that one of the most widespread neologisms of Russian origin in the Portuguese language is the word &quot;silovik&quot;, which is interpreted as having a semantic link with the old Russicism &quot;KGB.&quot; Portuguese public opinion accurately picked up on the main feature of contemporary Russia's style. 
 This style, which has obviously been introduced to the ruling structures by representatives of law-enforcement organizations, has three features: crude simplicity of problem-solving methods, decisiveness in the implementation of these methods, and highly negative consequences of this for the country's economy.
 The current crisis in the banking system is happening because instead of catching out the transgressors for their wrongdoings, officials of the Central Bank present them with primitive, semi-legal, formal complaints that one could present to any bank in the country. As a result, the remaining banks stop trusting each other, and stop offering each other loans, the result of which being that their liquidity decreases and they start to crash.
 In theory, the same mechanism was also in action when the Russian stock market crashed, when clumsy methods of destruction were taken up in relation to Yukos. These methods also sharply increased the outflow of capital out of Russia: for the first half of the year, according to preliminary figures from the Central Bank, this was twice as much as the equivalent figure for the whole of last year. 
 Clumsy methods are in general beginning to prevail in the socio-economic politics of the government. The (theoretically) correct idea of replacing the population's benefits with cash has been defaced by bad implementation. Instead of the people receiving sufficient financial compensation, a primitive cut in social security is being furtively introduced, and it is from this that the least protected social strata in particular will suffer. 
 The principle of targeting benefits, which implies an individual approach to social support (independent of a person's actual status) has been substituted by a primitive system of payouts that treats everyone the same, which is what existed before and will remain. It is easy for officials to calculate compensation for each category of beneficiary.
 The authorities have hampered a completely rational transfer of basic responsibility for social support from the centre to the regions by its latest redistribution of tax earnings in its own favor. One can also include here the clumsily carried out pension reform, the failure of which occurred precisely due to the methods being incapable of achieving its goals.
 
 <i>Vladimir Gryaznevich is a political analyst with Expert Severo-Zapad magazine. His comment was first broadcast on Ekho Moskvy in St. Petersburg on Friday.
 </i>

TITLE: Chris Floyd's Global Eye
AUTHOR: By Chris Floyd

TEXT: <b>Master Class</b> 
It's about oil. It's about Israel. It's about democracy. It's about terrorism. It's about global dominance. It's about Bush family dynamics. It's about national security. It's about religion.
 
Countless theories have been offered to explain the origins of George W. Bush's invasion of Iraq. Some are clearly specious, others have more merit, but all are speculative to some degree. The ultimate truth will doubtless prove elusive. &quot;Reality has always had too many heads,&quot; as Bob Dylan wisely reminds us. However, by sticking solely to clearly established, non-controversial facts, we can perhaps stake out a small patch of clear ground in the sulphurous fog of war. For the facts show that whatever else the Iraqi adventure may be about, at least one thing is certain beyond dispute: It's about money.
 For months here, we've outlined various aspects of the Bush Regime's unprecedented war profiteering, following the dripping trail of blood money from the ripped-up bodies of Iraqi children and the disemboweled corpses of American soldiers to the silk pockets of George Bush, Dick Cheney and their closest associates. While such grubby work is not as glamorous as high-flown theoretical pondering on the meaning of it all, (something we've certainly done our share of as well), it is perhaps the best way to thread Bush's Babylonian labyrinth of death and deceit.
 Last week saw a flurry of stories (largely ignored, naturally) indicating that the pervasive corruption of America's colonial enterprise has risen to new heights. Reports by scrupulously non-partisan institutions, including Christian Aid and the General Accounting Office, the independent investigative arm of the U.S. Congress, revealed that in the final weeks of its &quot;formal&quot; occupation of Iraq - before handing over nominal control of the client state to CIA-backed terrorist leader and ex-Baathist enforcer Iyad Allawi - the Bush Regime plunged into an orgy of graft that stripped Iraq's treasury bare. Most of this loot was divvied up in no-bid contracts to Regime lard buckets like Halliburton - but up to $3 billion of it simply &quot;disappeared&quot; into pockets yet unknown, the Baltimore Sun reports.
 Like their Baathist predecessors, the Bushist overlords were given control of the UN-established Development Fund, which was supposed to guarantee that Iraq's oil revenues were spent on the needs of the Iraqi people. But like Saddam, Bush instead used the fund as a barrel of personal pork to reward cronies and buy local political support with bribes. By the time Bush viceroy Paul Bremer made his hugger-mugger handover of &quot;sovereignty&quot; to CIA man Allawi, there was less than $1 billion left in the $20 billion fund - with more than $6 billion of this siphoned off in just the last two months of direct American rule, the Guardian reports.
 Where did it all go? Half went to &quot;Iraqi ministries&quot; staffed with local frontmen like Allawi and his cousin, convicted fraudster and intelligence forger Ahmad Chalabi, and with Bush partisans from back home, many of them young rightwing zealots with no administrative experience whatsoever. Another chunk went to military units for use in rebuilding buildings they'd blasted down, paying compensation to the families of innocent people they'd killed, and buying intelligence and informants to help meet Bushist quotas for filling the torturous interrogation rooms in Abu Ghraib and its gulag satellites - where the Red Cross says up to 90 percent of all the captives were innocent. Money well spent, obviously.
 The rest of the fund was given to Halliburton and friends for &quot;reconstruction&quot; - usually in non-competitive contracts doled out by Bremer and his handpicked &quot;Iraqi Governing Council&quot; without any independent review, the GAO reports. Almost the entire $20 billion fund was oil revenue - a nationalized resource belonging solely to the Iraqi people. And except for some chump change left behind for the CIA terrorist, it's all gone now.
 But the scam gets even sweeter. During the 14 months of direct rule, Bush - an old oil man - somehow failed to have the Iraqi oil under his charge properly metered. That means there was simply no way on earth to keep legitimate accounts on the oil revenue that was supposed to go into the Development Fund. Trying to make some sense of these well-cooked books, Christian Aid and international auditors compared the best production and pricing figures available from oil industry experts - and found a discrepancy of between $1.8 billion and $3 billion from the Bushists' claims of total oil revenues given to the Fund.
 We told you it was sweet: You get control of Iraq's oil money and dish it out to your cronies and collaborators until it's all gone - while setting aside a few secret billions for yourself that no one can ever trace. It's the same operation that Saddam ran. He's accused of skimming $4.4 billion from the Development Fund while he was in power - but that took him years. Bush almost matched him in just 14 months. As the Iraqis say of the occupation: &quot;The pupil has gone, the master has arrived.&quot;
 Indeed. Halliburton, under Cheney, once did a paltry $23 million in backdoor business with Saddam; now, cutting out the middleman (and more than 10,000 innocent lives as well), the company has $18 <i>billion</i> in Iraqi war contracts, thanks to its White House rainmakers. And no doubt that $3 billion unmetered skim will be bankrolling some fancy Houston mansions and choice Texas scrub-brush in the years to come.
 The question of war - its causes and consequences - is always a multi-headed hydra, defeating easy analysis. But for the thieves of Baghdad, one simple fact holds true: Crime pays. 
 
 <i>
For annotational references, please see the Opinion section at www.sptimesrussia.com </i>

TITLE: Survey: Putin's Popularity Drops Below 50 Percent
AUTHOR: By Oksana Yablokova

PUBLISHER: Staff Writer
TEXT: MOSCOW - Four months after a landslide re-election victory in March, President Vladimir Putin's ratings have plunged to below 50 percent, their lowest since he was first elected in 2000, according to the latest poll. Some contributed the decline to the start of unpopular social reforms.
 
Only 49 percent of those surveyed by the Public Opinion Foundation on July 3 and 4 said they would vote for Putin if an election were held today.
 This was a drop of 3 percentage points from the previous week, which is within the usual margin of error, but there has been a decline of 7 percent points since March, when Putin's ratings were at 56 percent.
 Most of last year, Putin's ratings were stable, at around 70 percent, according to various polls. He won re-election on March 14 with 71 percent of the vote.
 The latest poll was conducted in 200 cities and towns in 63 regions, with some 3,000 people questioned. The results were released late last week.
 Liliya Shevtsova, a political analyst with the Carnegie Moscow Center, said that a slight decline in Putin's popularity was to be expected and should be seen in view of the social reforms launched by Mikhail Fradkov's government.
 At the core of the social reforms is the government's plan to replace health care, transportation and subsidized housing benefits to the least-protected part of the population, such as pensioners and veterans, with non-indexed cash payments. The State Duma passed the legislation in the first reading last month and plans to bring it up for a second vote in early August. 
 The plan has drawn mass criticism from affected sectors of the population. 
 &quot;By not giving Putin credit, people are expressing their worries over the <br> social reforms, fearing that their living conditions would decline, and demonstrating that they do not understand the logic of these changes,&quot; Shevtsova said in a telephone interview Friday.
 Shevtsova said that people in the regions usually blame their declining living standards on regional leaders. &quot;However, Putin enjoys absolute power and any government looks like a technical one against his backdrop,&quot; Shevtsova said.
 The president's ratings are likely to drop even lower if the current instability in the banking sector continues, she said.
 The Public Opinion Foundation's latest poll also showed that the number of those who say they would not vote at all has grown to 15 percent, up from 11 percent in March.

TITLE: Pope to Return Russian Icon
PUBLISHER: The Associated Press
TEXT: INTROD, Italy - Pope John Paul II believes &quot;the time is ripe'' to return a revered icon to Russia to give a major push to improving relations between Catholics and Russian Orthodox Christians, his spokesman said Sunday.
 
The Vatican announced on Saturday that the icon of the Mother of God of Kazan, which usually hangs in the pope's private chapel, would be given back. The Vatican has had the icon for three decades.
 John Paul has long dreamed of visiting Russia, but tensions between Catholics and Orthodox since the fall of communism have prevented what would be the first trip there by a Roman Catholic pontiff.
 The pope had been hoping to return the icon himself, a delegation is to return the wooden icon on Aug. 28.
 The wooden icon, which first appeared in Kazan in 1579, hung in the Kazan Cathedral in Moscow's Red Square and the Kazan Cathedral in St. Petersburg before being taken to the West after the 1917 Bolshevik Revolution. A Catholic group bought the icon in the 1970s and later presented it to the pope.

TITLE: Gorge Remains Not Bodrov's
PUBLISHER: The St. Petersburg Times
TEXT: The human remains found in the Karmadon Gorge in the North Caucasus on Sunday are not those of film star Sergei Bodrov Jnr, it was announced Monday.
 
The remains, those of a man in his 30s, were found 150 meters north of a tunnel, where relatives and searchers had hoped the actor turned director and his crew had sheltered.
 Sergei Bodrov Jnr. and his crew were filming in the mountains of North Ossetia when an avalanche swept through the gorge in September 2002. 
 The tunnel was finally penetrated in May 2003, but was full of mud and water. The search was subsequently called off, despite relatives' protests.
 Only 20 bodies, including the most recent discovery, have been recovered and 105 people are still missing presumed dead, Interfax reported Monday.
 The latest discovery was made by two geologists from the Academy of Sciences. North Ossetian authorities now fear that there will be a fresh influx of relatives, eager to find their loved ones' bodies.
 Sergei Bodrov Jnr. was one of Russia's most popular young actors, famous for his films &quot;Brat-1,&quot; &quot;Brat-2&quot; and &quot;Prisoner of the Caucasus.&quot;

TITLE: AIDS Conference Sees Flaws in Bush's ABCs
AUTHOR: By Jennifer Valentino

PUBLISHER: The Associated Press
TEXT: BANGKOK - HIV experts criticized Washington's decision to send a pared-down delegation to the International AIDS Conference beginning Sunday as an intrusion of politics into science.
 
Conference organizers see the U.S. move as a reaction to the conference's lack of focus on abstinence as a way of preventing the spread of HIV - a pillar of President Bush's policy on AIDS.
 A major debate is scheduled at the conference on the merits of the Bush-backed ABC strategy, which stands for &quot;Abstinence, Being Faithful, Condom Use&quot; - in that order. Critics say promoting condoms should come first.
 Carol Bellamy, the executive director of UNICEF, said the policy ignores reality.
 &quot;ABC is insufficient when it comes to women in general. A: Rape doesn't respect abstinence; B: their partners are supposed to be but that is increasingly not occurring; and C: condoms are generally in the control of men. So when it comes to women and AIDS, let's understand the insufficiency of A, B and C,&quot; she said.
 Dr. Edward Green, a Harvard research scientist and member of the President's Advisory Council on HIV/AIDS, said past conferences were biased against research on successful abstinence programs.
 &quot;That's one of the reasons the U.S. government sent a smaller delegation,&quot; he said. &quot;There was concern that the organizers of the conference would have another sort of mutual admiration society of condoms and pills, condoms and pills - what they've been talking about this whole time.&quot;
 The six-day conference, drawing nearly 20,000 policy makers, scientists, health officials and activists, is the largest global meeting on the disease, which has killed 20 million people so far and is now afflicting 38 million.
 But the United States, a global leader in AIDS research, is sending 50 delegates, a fraction of the 236 it sent to the last conference in Barcelona, Spain, in 2002. U.S. officials say they want to cut costs, from the $3.6 million it spent on the Barcelona trip to $500,000 this time.
 Conference organizers are not convinced.
 The decision was &quot;entirely based on politics,&quot; a view widely held by scientists and others attending the event, said Joep Lange, president of the International AIDS Society and a co-chair of the conference.
 The U.S. move sends &quot;a strange signal&quot; from the largest donor nation to anti-AIDS efforts, Lange said. 
 &quot;We desperately need the U.S., and we are extremely grateful to the U.S.,&quot; he said. 
 &quot;But these ideological games are very counterproductive.&quot;

TITLE: Sharon Says UN Encouraging Terrorism
AUTHOR: By Mark Levine

PUBLISHER: The Associated Press
TEXT: JERUSALEM - Prime Minister Ariel Sharon linked the world court's condemnation of Israel's West Bank separation barrier to a deadly bombing in Tel Aviv and ordered construction of the contentious complex of walls, trenches and fences to continue.
 
Palestinian militants blew up a bus stop with a nail-studded bomb hidden in roadside shrubs on Sunday, killing a female soldier and seriously wounding five people in the first deadly bombing in Israel since March.
 Violence continued Monday in the southern Gaza Strip, when a military force destroyed several structures on the outskirts of the town of Khan Younis. A 72-year-old man died in the operation and family members said he had not heard army calls to evacuate his home and had been killed under the rubble.
 The army said they destroyed a number of uninhabited tin shacks that had been used by militants as cover to fire on Israeli targets.
 Sharon tied it to the world court's nonbinding ruling on Friday against the barrier, which Israel says is needed to stop such attacks.
 &quot;The decision sends a destructive message to encourage terrorism and denounces countries that are defending themselves against it,&quot; Sharon said.
 Palestinians, welcoming the decision, planned a diplomatic assault to enforce it. However, they put off an appeal to the UN Security Council until after the November presidential elections in the United States, fearing a U.S. veto.
 &quot;The decision now is for the General Assembly to decide what the coming step is,&quot; said Palestinian Prime Minister Ahmed Qureia. &quot;As for us, we will continue to battle.&quot;
 The Palestinians enjoy broad support in the much larger General Assembly, but its decisions aren't binding.
 Early Sunday, a 2 kilogram bomb filled with sharp pieces of metal exploded as a bus pulled up at a stop near Tel Aviv's central bus station.
 A 19-year-old female soldier was killed, and 32 people were hurt, five of them seriously. The remainder were treated for shock or light wounds.
 The Al Aqsa Martyrs' Brigades, a violent Palestinian group linked to Yasser Arafat's Fatah faction, claimed responsibility, saying it was avenging the deaths of members killed by Israel. &quot;This says that we can reach every place, even when there is a fence,&quot; said an Al Aqsa spokesman in the West Bank city of Nablus, refusing to give his name.
 Palestinian officials condemned the attack. &quot;We are against all bombings like this,&quot; Arafat said.
 Israel began building the barrier two years ago, saying it is needed to keep out Palestinian attackers who have killed nearly 1,000 Israelis in four years of fighting. More than 3,000 Palestinians were killed in the same period, most by army fire.
 Israel has completed one-quarter of the planned 425-mile project, and cited the barrier as a key reason for the recent lull in Palestinian attacks.
 But the barrier stretches deep into the West Bank and has disrupted the lives of thousands of Palestinians. The Palestinians turned to the world court, arguing that the barrier amounts to an illegal land grab. 
 The Palestinians want an independent state in all of the West Bank and Gaza Strip.

TITLE: IN BRIEF
TEXT: <b>Indian Flood
 </b>

GUWAHATI, India (Reuters) - The worst monsoon flooding in years has forced more than two million people from their homes in northeastern India, officials say.
 Floodwaters have swept away thousands of bamboo and straw homes, as well as power lines and more than two dozen small dams.
 "We are experiencing the worst ever flooding this time in recent years," Tarun Gogoi, Assam state chief minister told Reuters on Monday.
 At least six air force helicopters have been deployed to rescue marooned people, most of them women and children trapped on rooftops.
 Landslides caused by the heavy rains in mountainous Arunachal Pradesh state have blocked roads and washed away bridges.
 
 
<b>Italy Refuses Refugees
 </b>

ROME (AP) - Italian coast guard vessels Sunday blocked a ship carrying Sudanese refugees as it tried to dock in Sicily after sailing the Mediterranean for three weeks searching for a port of refuge.
 The captain of the Cap Anamur had called for help, saying the refugees were threatening to jump overboard and that he was heading toward land whether authorized or not, Italian television reported.
 Police and coast guard craft had escorted the aid group Cap Anamur's ship toward the Porto Empedocle, but then an array of coast guard and police boats moved to guard the entrance to the port, preventing the ship from docking.
 The ministry said doctors will examine the passengers and crew and those in need of care will be taken to local hospitals. But it said the boat itself would remain blocked outside the port to allow an investigation of what it called "the mysterious aspects regarding the conduct of the ship and crew."
 It did not elaborate, but some Italian news reports have said authorities suspect that the ship might have been provoking a standoff to test the immigration policies of European nations.
 
 
<b>Srebrenica Remembered
 </b>

SREBRENICA, Bosnia-Herzegovina (AP) -Commemorating Europe's worst massacre since World War II, more than 20,000 people gathered Sunday to rebury the remains of some of the more than 7,000 Muslim men and boys killed by Bosnian Serbs nine years ago.
 The emotional ceremony at the site of the slaughter remembered 338 victims whose remains had been exhumed from mass graves and identified.
 Most mourned silently, but some women sobbed openly as the green coffins were lowered into graves next to mounds containing the remains of 998 previously identified and reburied victims.
 Mustafa Ceric, the head of Bosnia's Muslim community, asked God to bring healing to the hearts of those who lost husbands, sons and brothers.
 "There cannot be revenge, because revenge is not our faith, not our destiny and it is not the way in Bosnia," he said.
 
 
<b>Hostage Deadline Tues.
 </b>

MANILA, Philippines (AP) - Iraqi insurgents threatening to kill a Filipino hostage unless the government agrees to an early troop withdrawal from the Middle East country have extended the deadline until Tuesday, an official said.
 The group that snatched truck driver Angelo dela Cruz, 46, near restive Fallujah initially gave the Philippines until 11 p.m. Sunday Baghdad time [same time zone as St. Petersburg] to agree to pull its troops out of Iraq by July 20.
 But the Philippines said its 51 soldiers and police would leave Aug. 20, as scheduled.
 After the rejection, the insurgents extended the deadline until Tuesday, a government official said Monday on condition of anonymity. He said the government is hopeful dela Cruz would be released. 



TITLE: Greene Light Leads U.S. Team to the Olympics
AUTHOR: By Bob Baum

PUBLISHER: The Associated Press
TEXT: SACRAMENTO, California - Tim Montgomery and girlfriend Marion Jones can watch the Olympic 100 meters together. Neither one will be in the races.
 
Montgomery, the event's world record holder, finished seventh in the 100 final Sunday in the U.S. Olympic track and field trials, far behind the winner - his strutting, fist-pumping, longtime nemesis Maurice Greene. 
 One day earlier, Jones was fifth in the women's 100 final, losing out on a bid to defend her gold medal in the Athens Games. 
 Both left the track area amid a horde of reporters, pausing only long enough to rip the media for the coverage of the steroid scandal that has unfolded around them. 
 &quot;This is the reason I didn't win: I've got y'all on my back,'' Montgomery said. &quot;I have to deal with y'all every day.'' 
 Montgomery has bigger problems away from the track. The U.S. Anti-Doping Agency has accused him with using steroids and other performance enhancing drugs. If found guilty, he could be banned from the sport for life. 
 Montgomery has taken his case directly to the International Court of Arbitration for Sport, where the decision is binding. 
 He is one of four sprinters accused by USADA of steroid use. If found guilty, they all face lifetime bans. 
 Michelle Collins, one of those facing the charges and a favorite in the women's 400, withdrew from the meet Sunday, citing a hamstring injury, her coach said. George Williams, also the coach of the U.S. Olympic men's team, said she phoned him from Texas to say she was injured on the warmup track in Sacramento and had returned home. 
 Another member of that quartet, Chryste Gaines, failed to qualify in the women's 100.
 That left Alvin Harrison as the only one of the four still running at the trials. He made it through the first round of the 400 Sunday.
 Jones has not been formally accused of an any drug offense, but remains under investigation by the USADA. She has repeatedly, firmly denied ever using performance-enhancing drugs.
 After her poor showing Saturday, she followed a beefy bodyguard off the track to a golf cart that took her away. 
 &quot;I talk to you guys and you say something negative,'' she said. &quot;I don't talk to you guys and you say something negative. I'd much rather not talk and spend time with my son.'' 
 Montgomery is finished, but Jones will be back at California State's Sacramento track Monday night for the long jump qualifying. She also is entered in the 200.
 Greene, who turns 30 on July 23, appeared ready to defend his gold medal in the 100 with a 9.91 clocking. Justin Gatlin was second at 9.92 and Shawn Crawford third at 9.93. The top three in each event make the Olympic team.
 &quot;My goal is to go 1-2-3 and show the world we have the best sprinters,'' Greene said.
 Crawford has the world's fastest time this year, 9.87 seconds last month in the Prefontaine Classic. 
 &quot;I think I'll win it in Athens,&quot; Crawford said. &quot;I'm through being humble.'' 
 Greene's comeback from a broken leg in a 2002 motorcycle accident is complete.
 &quot;Greatest of all time, what can I say?'' he said. 
 That's what the &quot;G.O.A.T'' tattoo on his right biceps stands for. There's also a lion in the tattoo, representing Greene's self-proclaimed status as king.
 &quot;And the track is my jungle,'' he said with beastly confidence.

TITLE: Armstrong and Ullrich Look For Gain in Second Week
AUTHOR: By Jamey Keaten

PUBLISHER: The Associated Press
TEXT: LIMOGES, France - Lance Armstrong knows exactly where his biggest rival stands in the Tour de France. 
 
While Jan Ullrich went largely unnoticed in the crash-marred first week, Armstrong has been paying close attention to the German and figures he'll be a factor in the mountain stages.
 &quot;That's OK to be quiet so far,'' Armstrong said Sunday. &quot;He's been safe, conservative and out of the way.''
 Still, doubts about Ullrich remain. 
 &quot;Where's Ullrich?'' read a headline Sunday in the French sports newspaper L'Equipe, speculating that a cold he had in the week before the race could have hurt him.
 But his team insists all is well, and Armstrong rejected suggestions that the 30-year-old German has lost his drive after five second-place finishes - one off the record in the event.
 &quot;He's hungry,'' Armstrong said after he and other riders arrived by plane Sunday in Limoges. 
 After Monday's rest, the race heads for three days into the Massif Central, a mountainous, agricultural plateau offering an indication of how riders will fare in tougher climbs through the Pyrenees and Alps later in the three-week event.
 &quot;We'll start to see the start of the real race,'' said Armstrong, seeking his record sixth straight title. Norway's Thor Hushovd, the winner Sunday in a hilly but fast stage through Brittany in western France, and other speedsters will give way in the mountains to more nimble climbers and all-rounders such as Ullrich and Armstrong.
 French champion Thomas Voeckler retained the overall leader's yellow jersey, with Armstrong sixth - 9 minutes, 35 seconds behind. Ullrich was 20th - 55 seconds behind the American.
 More than half of the 188 riders who started the race July 3 have been involved in crashes - the latest Sunday in the 104.4-mile stage from Lamballe to Quimper in Brittany.
 A dog scampering into the pack of riders near the end felled French rider Samuel Dumoulin, who was nearly 11 minutes behind Hushovd's winning time of 3 hours, 54 minutes, 22 seconds.
 The crashes are largely due to rain that slickened roads, early nerves and the high speeds of sprints at the end of almost every stage last week. Teams looking to shepherd their leaders toward the front of the pack, out of trouble, fueled jitters by boxing for position.
 For now, Ullrich said he was happy to have had Monday off to do &quot;some unwinding.'' 
 Armstrong was largely content to have made it through the harrowing first week intact - fearful that a crash could end his hopes for another title.
 &quot;It's been a crazy first week,'' he said. &quot;I don't ever remember doing one like that.'

TITLE: SPORTS WATCH
TEXT: <b>Women's Fed Cup Win
 </b>

MOSCOW (SPT) - Vera Zvonareva, a late replacement for Svetlana Kuznetsova, clinched victory for the Russians against Argentina in their quarterfinal tie in Buenos Aires Sunday.
 World No. 13 Zvonareva defeated Mariana Diaz-Oliva, who replaced Natalia Gussoni, 6-3, 6-0 in just over an hour to see Russia through to the semifinals. Earlier, Anastasia Myskina scored her second straight-sets victory of the weekend when she defeated Gisela Dulko 6-1, 7-5 in 1 hour, 12 minutes.
 Russia's semi-final opponent will be decided when the last four teams in the 2004 Fed Cup competition are redrawn ahead of the Fed Cup Semi-finals and Finals, which take place the week of Nov. 22.
 
 
<b>Yankees Top Devil Rays
 </b>

NEW YORK (AP) - Derek Jeter's three-run double snapped a seventh-inning tie, Alex Rodriguez homered into the left-field upper deck and the New York Yankees beat the Tampa Bay Devil Rays 6-3 Saturday.
 Jon Lieber (7-5) gave the Yankees their best start in more than two weeks, pitching seven solid innings to win his second consecutive outing. New York has beaten Tampa Bay three straight times after dropping five of six against the New York Mets and Detroit.
 In St. Louis, Jim Edmonds homered for the fourth straight game and Jeff Suppan worked six strong innings, helping the St. Louis Cardinals beat the Chicago Cubs 5-2 Saturday for their eighth consecutive victory.
 In Miami, Mike Lowell hit a two-run homer and Ben Howard pitched out of a seventh-inning jam to help the Florida Marlins beat the New York Mets 5-2 Saturday night.
 
 
<b>Kiwis' Final Glory 
 </b>

LONDON (Reuters) - Spinner Daniel Vettori took five wickets to inspire New Zealand to a 107-run victory over West Indies in the triangular series final at Lord's on Saturday.
 Vettori, who finished with figures of five for 30, was also responsible for two run outs while Chris Harris became the first New Zealander to take 200 wickets and score 4,000 runs in one-dayers as West Indies were dismissed for 159 in 41.2 overs.
 
 
<b>Argentines Lose
 </b>

CHICLAYO, Peru (Reuters) - Mexico brought Argentina crashing back to earth when a brilliant Ramon Morales free kick was enough to give them a 1-0 victory in their Copa America Group B match Saturday.
 The defeat will put the pressure back on Argentina coach Marcelo Bielsa after it had been briefly lifted with Wednesday's 6-1 demolition of Ecuador.
 Argentina, who dropped to third in the group with three points from two games behind Uruguay and Mexico, never managed to find the flowing football they produced against Ecuador.
 
 
<b>Soccer Transfer Peaks
 </b>

HURWORTH, England (Reuters) - English Premier League club Middlesbrough signed former Chelsea striker Jimmy Floyd Hasselbaink at the weekend, 24 hours after it unveiled his future strike partner, former Leeds United forward Mark Viduka, and three days after the presentation of another Dutch signing, defender Michael Reiziger.
 Meanwhile, Tottenham Hotspur has sold striker Helder Postiga back to European champions Porto for 7.5 million euros ($9.3 million) and bought midfielder Pedro Mendes from the club for 3 million euros under a four-year contract.