Russia 111111

Basic Political Developments Patriarch Kirill to visit Syria, Lebanon - Moscow, November 11, Interfax -

Patriarch Kirill of Moscow and All Russia is expected to visit Syria and Lebanon from November 12-15, Moscow Patriarchate spokesman Archpriest Vladimir Vigilyansky told Interfax-Religion on Friday.

Syrian 'external' opposition delegation to visit Moscow (Part 2) - "A delegation of the Syrian National Council led by Ghalioun will arrive at the beginning of next week at the invitation of Russia's Foreign Ministry. Meetings with Sergei Lavrov, as well as in the State Duma and the Federation Council will be held," al-Hamza said.

Russian-Syrian Friendship Association Reiterates Support to Syria - During a meeting of the association's board in Moscow in presence of Syria's Ambassador in Moscow Riad Haddad, Dzasokhov said that it is not enough to say no to attacking Syria; rather practical steps should be made to support the Syrian people and offer tangible suggestions to help Syria overcome the current circumstances.

Russia, China say new Iran sanctions will yield no desired result RUSSIA READY TO DEVELOP KURIL ISLANDS TOGETHER WITH

JAPAN - MEDVEDEV o MEDVEDEV: MILITARY FORCES IN KURIL ISLANDS MUST BE

REASONABLY SUFFICIENT, MUST NOT BE A THREAT TO JAPAN, OTHER COUNTRIES

Medvedev hopes development centre will be formed in Russia’s Far East after APEC summit

o Russia can successfully pass 2nd crisis wave - Medvedevo Russia Has ‘Most Calm Situation’ Compared to Rest of G20o Russia will better weather new wave of economic crisis – Medvedev o “Modernization poles” to be set up in Russia

Russia to protect interests in Arctic – Medvedev: Russia will protect its interests in the Arctic and will make investments in regional exploration, Russian President Dmitry Medvedev said at a meeting with workers of the Amurkabel enterprise here on Friday.

Medvedev to attend APEC summit in Honolulu - “Russia will have to pick up the chair’s baton from the United States, … and announce the priorities of APEC activities in 2012,” he said… Medvedev will meet with his U.S. counterpart Barack Obama on November 12. Prikhodko earlier said Medvedev and Obama will discuss missile defense issues on the sidelines of the APEC summit.

U.S. believes Russia’s proposals on 2012 APEC agenda reasonable o Russia offers four issues for APEC presidency

Russian dignitaries in town for APEC spend time on the Big Isle US may repeal Jackson-Vanik before 2012

o USRBC to work with Congress, Administration to lift Jackson-Vanik as Russia joins WTO - The U.S.-Russia Business Council stated that it would

work hard to lift  the Jackson Venik amendment, as the country joins WTO.

Russia to be invited to WTO Dec. 15-17 - Obama o WTO chief sees win-win situation in Russian membershipo Russia to cut tariffs ahead of WTO entry - The Kremlin agreed that in the

years following accession, foreign telecommunications companies will no longer be limited to 49 per cent equity in Russian businesses, while foreign bank will be allowed to establish subsidiaries, with no cap on foreign capital participation in individual Russian banks.

o Farmers challenged by WTO accession - Russia has agreed to lower its agricultural tariffs as part of the agreement to join the WTO.

o Impact of Russia's WTO Entry on U.S. - Stephen Sestanovich, George F. Kennan Senior Fellow for Russian and Eurasian Studies, Council on Foreign Relations

o U.S. companies to gain access to huge market with Russia's WTO accession – experts

o Russian Industries May Rile WTO by Undermining Trade Pledges - By Jennifer M. Freedman

o WTO Entry to Benefit Russian Economy - By SUDEEP REDDY o Russia closes WTO deal – details – bneo RF-Georgia WTO agt not question Abkhazia, S Ossetia recognition -

Dvorkovicho Georgia declares its victory over Russia on issue of Abkhazia and South

Ossetiao Kazakhstan may follow Russia in WTO accession - Chief Russian WTO

negotiator Maxim Medvedkov believes Kazakhstan is likely to become the next party of the Customs Union to join the World Trade Organization and Belarus would follow suit.

Nov 21: Kazakhstan’s Minister of Foreign Affairs Yerzhan Kazykhanov to visit Russia

Azerbaijan: Russia’s accession to WTO not to affect Azerbaijan’s export to this country

EU: Russia Using Energy as Diplomacy 'Weapon' - "Putin is not interested in having a new Red Army, he sees energy as being his weapon," Guenther Oettinger said during an event about Europe's energy security at the European Parliament. The EU has to recognize that quickly and react jointly, he said.

Abkhaz deputies to monitor South Ossetian elections Kudankulam N-Plant: Nuclear watchdog asks for additional safety measures Bout wants to ask Russia to pass his case to international court - newspaper

o Russia set to have convicted Bout back homeo Russian human rights commissioner discusses Bout's future with US

diplomatso ‘Why foster false hope?’ - Viktor Bout gives an interview to Kommersant

from the Metropolitan Correctional Center (MCC) in New York. Kirill Belyaninov (New York)

Russia supplies Nicaragua with Lada Kalinas - Russia has delivered another batch of 550 Lada Kalina cars to Nicaragua.

Russia Says Ukraine Claims No Of USSR's Abroad Property - Russia states that Ukraine claims no of the former USSR's abroad property, reads a statement made by the press service of the Russian Foreign Affairs Ministry, citing Alexander Lukashevich, an official representative of the Russian Foreign Ministry, as saying on November 10.

RF hands over chair in Council of Heads of CIS Chambers of Commerce to Tajikistan.

Youth movement activists to picket Tajik Embassy in Moscow on November 14 o Russian ambassador to return to Tajikistan by Monday - "Given the

situation over the Russian pilot, the Russian ambassador in Dushanbe was summoned for brief consultations to the Russian Foreign Ministry and will return to his duties on Monday," the source said

o Tajikistan ready for talks, Moscow threatens deportations over jailed pilot o Dushanbe wants to sort out situation with convicted pilots - Russian

diplomato Russian Ambassador to Tajikistan leaves for Moscow for consultations

Russia ambassador, Tajik president discuss Russian pilot situation o Dushanbe claims Moscow didn't inquire about pilots during preliminary

probeo FMS does not confirm ban on work permits for Tajik labor migrants o Russia to extradite 100 Tajiks in response to harsh sentence for Russian

pilot Russian military base in Tajikistan destroys expired ammunitions - An operation

to destroy expired ammunitions was completed in Tajikistan, Asia-Plus reported referring to Captain Dmitry Matushkin, an aide to the commander of the Russian military base in Tajikistan. According to him, more than 72 tons of expired ammunition have been destroyed at the Lohour training ground over the past ten days.

Soyuz rocket with manned spacecraft installed on Gagarin’s pado Rosavatsiya search-rescue team to ensure Soyuz ship launch safety o Russia`s Space Agency to stop talking to astronauts before launch

Chance of Russia Mars probe rescue 'very small'o Contact with Mars moon probe still unsuccessful

Technical malfunctions force Boeing-757-200 to land in Yakutsk - “While in the air, the Boeing-757-200 airplane developed malfunctions in the system feeding air to the flight deck. The pilots decided to land in the Yakutsk airport,” the spokesman said.

Russian Press at a Glance, Friday, November 11, 2011 Russia’s Red and Blacks: A Tale of Two Generations - This is a tale of Moscow’s

two demonstrations — first the Nationalists, then the Communists , It is not just a tale of the Blacks and the Reds, but a tale of two generations.

When the Russians go marching in - according to Levada Center poll data, 48 percent of Russians want the “nationality” line to be put back in passports.

National Economic Trends Russian ruble strengthens on back of European political events Ruble Advances Against Dollar for Second Day as Oil Prices Rise Russia to handle short-term double dip, banker claims CBR's reserves declined last week October non-CIS imports up 20% y/y

Business, Energy or Environmental regulations or discussions Russian markets -- Factors to Watch on Nov 11 RTS Futures Drop on Growth as Sberbank Climbs: Russia Overnight MICEX offers foreign brokers direct access Skolkovo raises $265m from private investors Sberbank to raise $1.2 bln loan at LIBOR+1.5 pct-source Rusal Slides to Week-Low in Moscow on Dividend Opposition Report Rusal Management Opposes Interim Dividends, Vedomosti Reports SUEK ups coal output 8.8% in Jan-Oct Russia's Evraz extends share exchange offer Globaltrans raises stake in BaltTransServis to 60 pct for $75 mln UTair's net profit slides in 9M Aeroflot boosts revenue in January-September Online retailers mull association to fight shadow market AvtoVAZ to build new plant in Kazakhstan Inter RAO may participate in JV with Swiss Alpiq AG to build underwater

electric cable to Germany Q&A: Steering the 'Gazprom of the U.S.' in Russian Waters - Three years into his

assignment as GE's top official in Russia, Welch advised Pollett that it was time to pack his bags and go to his next assignment.

Activity in the Oil and Gas sector (including regulatory) Russia to liberalize gas prices as WTO member Unified trading session for oil products may be launched in early 2012 Russia will present a package of tax breaks for Arctic before the year end Russian court rejects lawsuit against BP execs - A Siberian court has rejected a

$2.8 billion lawsuit filed by minority shareholders in Russia's No.3 oil firm TNK-BP against board members nominated by the firm's British shareholder BP, a BP lawyer said on Friday.

LUKoil to invest over $16 bln in North Caspian deposits Timchenko consolidates 93% of Transoil (Part 2) 'Russian response to Trans-Caspian pipeline construction would follow quickly' -

News.Az interviews Konstantin Simonov, Director General of the National Energy Security Fund (Russia).

Russia to retain dominance on the gas market - Experts predict the end of the era of cheap oil. By Daria Tsilyurik (Nezavisimaya)

Gazprom Gazprom mandates BNPP and JPM for bond Gazprombank raises 350 mln in Swiss franc bond

Turning Gas Down - New Market Realities May Compel Gazprom to Lower Export Gas Prices to Meet Sales Forecast. By Tai Adelaja Russia Profile

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Full Text Articles

Basic Political Developments

11 November 2011, 12:28

Patriarch Kirill to visit Syria, Lebanonhttp://www.interfax-religion.com/?act=news&div=8870

Moscow, November 11, Interfax - Patriarch Kirill of Moscow and All Russia is expected to visit Syria and Lebanon from November 12-15, Moscow Patriarchate spokesman Archpriest Vladimir Vigilyansky told Interfax-Religion on Friday.

"The program of the Russian Patriarch's visits is being detailed now. By tradition, after election patriarchs visit all local Orthodox Churches," he said.

The order of the visits complies with the diptych - the catalogue of 15 jurisdictions: the Constantinople, Alexandrian, Antiochian, Jerusalem, Russian, Georgian, Serb, Romanian, Bulgarian, Cyprus, Greek, Albanian and Polish Orthodox Churches, the Orthodox Church of the Czech Lands and Slovakia, and the Orthodox Church in America.

November 11, 2011 11:24

Syrian 'external' opposition delegation to visit Moscow (Part 2)http://www.interfax.com/newsinf.asp?id=286559

MOSCOW. Nov 11 (Interfax) - A delegation of the opposition Syrian National Council led by Chairman Burhan Ghalioun will visit Moscow next week to meet with Russian Foreign Minister Sergei Lavrov and parliamentarians, representative of the Committee to Support the Syrian Revolution in Russia Mahmoud al-Hamza told Interfax on Friday.

"A delegation of the Syrian National Council led by Ghalioun will arrive at the beginning of next week at the invitation of Russia's Foreign Ministry. Meetings with Sergei Lavrov, as well as in the State Duma and the Federation Council will be held," al-Hamza said.

The Syrian opposition's members will most likely arrive in Moscow on Monday evening, he said.

"The delegation will try to persuade Russia to play a more proactive role and to put pressure on the Syrian regime in order to stop the bloodshed," he said.

"We want Russia to take the side of the Syrian people, the side of justice," al-Hamza said.

The Russian Foreign Ministry earlier forwarded invitations to visit Moscow to Syria's domestic opposition and the Syrian opposition abroad, which is represented by the Syrian National Council.

Members of Syria's domestic opposition visited Moscow in mid-October.

tm rb

Russian-Syrian Friendship Association Reiterates Support to Syria

http://www.sana.sy/eng/22/2011/11/11/380929.htm

Nov 11, 2011

MOSCOW, (SANA) – Chairman of the Russian-Syrian Friendship Association, Alexander Dzasokhov, stressed on Thursday that Russia supports the people and leadership of Syria, adding that the Russian public opinion closely follows the situation in Syria.

During a meeting of the association's board in Moscow in presence of Syria's Ambassador in Moscow Riad Haddad, Dzasokhov said that it is not enough to say no to attacking Syria; rather practical steps should be made to support the Syrian people and offer tangible suggestions to help Syria overcome the current circumstances.

For his part, Syria's Ambassador, pointed out to Syria's agreement upon the Arab League initiative, releasing 553 detainees and issuing a general amnesty for those who did not commit crimes of killing.

The Ambassador stressed that there are foreign parties working to escalate tension in Syria and provoke armed terrorist groups to continue their crimes.

F.Allafi/al-Ibrahim

01:32 11/11/2011ALL NEWS

Russia, China say new Iran sanctions will yield no desired result

http://www.itar-tass.com/en/c154/269099.html

MOSCOW, November 11 (Itar-Tass) —— Russian and Chinese diplomats agreed on Thursday new sanctions against Iran will not yield the desired result.

“During the discussion of the Iranian nuclear program the parties called for its resolution exclusively by political and diplomatic means. A common conviction was expressed that the introduction of new additional sanctions against Iran will not yield the desired result,” the Russian foreign ministry said in comments to a meeting between Deputy Foreign Minister Mikhail Bogdanov and Director General of the West Asian and North African Affairs department of the Chinese foreign ministry Chen Xiaodong.

The parties also discussed ways of a peaceful settlement of the domestic crisis in Syria.

“Russia and China supported the LAS initiative and believe it is necessary to overcome crisis situations in the Middle East and North Africa without violence and through a broad national dialogue and without any outside interference. The peoples of the region can and should decide their own fate,” the ministry said.

The Russian and Chinese parties called for a resumption of the Palestinian-Israeli negotiations on the existing international legal basis with the final aim of creating an independent, viable, territorially integral, and sovereign Palestinian state in the 1967 borders that will “live side by side in peace and security with Israel.”

11/11 13:20   RUSSIA READY TO DEVELOP KURIL ISLANDS TOGETHER WITH JAPAN - MEDVEDEV 

http://www.interfax.com/

11/11 13:20   MEDVEDEV: MILITARY FORCES IN KURIL ISLANDS MUST BE REASONABLY SUFFICIENT, MUST NOT BE A THREAT TO JAPAN, OTHER COUNTRIES

http://www.interfax.com/

12:13 11/11/2011ALL NEWS

Medvedev hopes development centre will be formed in Russia’s Far East after APEC summit

http://www.itar-tass.com/en/c154/269407.html

KHABAROVSK, November 11 (Itar-Tass) —— Russian President Dmitry Medvedev hope that after the APEC summit in the Russian city of Vladivostok in 2012 a centre of Asia Pacific development will be formed in Russia’s Far East.

Medvedev said he was sure the 2012 APEC summit will be held at a very high level. But it does not mean, he added, that as soon as the summit is over Russia may afford to relax. “I hope that the active work will be continued, including in terms of building relations with neighboring countries,” he said at a meeting of the presidium of the Russian State Council.

The president called to implement large-scale economic projects in the Far East jointly with foreign partners. “The summit of the Asia Pacific Economic Community is only the beginning of the road towards creating a strong and competitive Russian centre of development in Asia Pacific,” he said. “It is necessary to modernize infrastructure, first of all, transport infrastructure. Priority attention should be paid to projects targeting to improve transport service between regions, to consolidate them into a united country.”

 

09:49 11/11/2011Top News

Russia can successfully pass 2nd crisis wave - Medvedevhttp://www.itar-tass.com/en/c32/269328.html

KHABAROVSK, November 11 (Itar-Tass) — Russian President Dmitry Medvedev believes that Russia is capable of successfully passing the second wave of the crisis.

“We sometimes disparagingly treat ourselves, but after all we have the sixth largest economy in the world, and it gives us a chance to survive in the global economic space,” the president said. “Forecasts vary, but in general, our situation is somewhat better than in some European countries,” he said.

According to Medvedev, the GDP growth in Russia this year is expected to be 4 - 4.5 percent, higher than in many countries, inflation is projected at the lowest level in modern Russia’s history - 7 percent. In addition, the industry has been returned to pre-crisis level, and unemployment is significantly lower.

“But if we say that we protected from the problems this would be a lie,” the president said. “We must minimise our dependence on the fluctuations on the raw materials market,” he said, adding that this requires diversification of the economy. “Therefore, our task is to comprehensively develop the industry, to carry out, if you want, a new industrialisation,” Medvedev noted. “If this is achieved, we will be more warded off the negative impact,” he said. “I am a moderate optimist in this sense,” said the president.

Medvedev recalled that the first wave of the crisis was unexpected for many. “But we overcame it,” he said. According to him, at present there are “many difficulties, especially in the euro area.” “This is due to the fact that for a long time the counties have not been able to agree on the principles of overcoming the crisis,” said Medvedev. At the same time he reiterated that the situation in Russia is slightly more stable. “This is the best guarantee that we will pass this period calmly,” the president said.

Russia Has ‘Most Calm Situation’ Compared to Rest of G20http://www.bloomberg.com/news/2011-11-11/russia-has-most-calm-situation-compared-to-rest-of-g20.html

QBy Ilya Arkhipov - Nov 11, 2011 5:25 AM GMT+0100

Representatives of the Group of 20 economies aren’t in a “very good mood” and Russia seems to have “the most calm situation,” Russia’s President Dmitry Medvedev said in the Far Eastern town of Khabarovsk today.

Russia’s gross domestic product growth is seen at 4 percent to 4.5 percent this year, Medvedev said, speaking at the Amursk cable plant. The country’s inflation is seen at 7 percent, the lowest in the last 20 years, Medvedev said.

To contact the reporter on this story: Ilya Arkhipov in Moscow at iarkhipov@bloomberg.net

To contact the editor responsible for this story: Claudia Carpenter at ccarpenter2@bloomberg.net

Russia will better weather new wave of economic crisis – Medvedev http://english.ruvr.ru/2011/11/11/60203382.html

Nov 11, 2011 10:02 Moscow Time

Russia is better prepared to cope with another likely wave of the world economic crisis than in 2008, when the Globe’s leading nations suffered heavily, said the Russian

President Dmitry Medvedev when talking with reporters in the city of Khabarovsk, in the Russian Far East.

He said he was moderately optimistic about the world financial situation, but more so concerning Russia.

The President said this country has reached the pre-crisis income level, while the figures for unemployment are a lot better than in many other countries.

He said this year saw the lowest rate of inflation on new Russia’s record, - 7%.

The Russian leader feels that efforts should be made shortly to make the Russian economy less dependent on hydrocarbons, which will call for developing industrial production.

(IF).

“Modernization poles” to be set up in Russia http://english.ruvr.ru/2011/11/11/60214119.html

1.     The Russian President Dmitry Medvedev has suggested setting up special-purpose ‘modernization poles’ throughout Russia. When addressing a meeting of the State Council Presidium in the city of Khabarovsk, in the Russian Far East today, he said that such highly technological areas could be set up around major cities to ensure speedy regional development and bridge the gaps between living standards. Russian citizens should enjoy reliable social protection, quality medical service, education and access to all the blessings of modern-day civilization irrespectively of the place they are living in, the President said. He added that new centres of growth will crop up in the European part of Russia, the Volga River basin, the Urals, in the south of the country, in Siberia and the Far East. (RIAN).

09:35 11/11/2011ALL NEWS

Russia to protect interests in Arctic - Medvedev

http://www.itar-tass.com/en/c154/269254.html

KHABAROVSK, November 11 (Itar-Tass) —— Russia will protect its interests in the Arctic and will make investments in regional exploration, Russian President Dmitry Medvedev said at a meeting with workers of the Amurkabel enterprise here on Friday.

“All decisions to this effect are not just prepared, they are taken,” he noted. “If we do not do it, other countries will act there,” Medvedev pointed out. “The Arctic, a region of the Arctic Ocean, is our neighbouring seas, this is our territory, our expanses,” the president remarked. “If we do not invest in this, the countries from other regions will come there,” he warned. Several countries from other regions already stated about their interests in the Arctic, Medvedev noted. “So they are going to come there, and we are not going to,” the president stressed ironically. “We will obligatorily make investments in this research and will protect our interests in the region,” Medvedev underlined.

Medvedev to attend APEC summit in Honoluluhttp://en.rian.ru/russia/20111111/168590240.html

02:48 11/11/2011

MOSCOW, November 11 (RIA Novosti)

Russian President Dmitry Medvedev will head for Hawaii to attend an Asia-Pacific Economic Cooperation (APEC) summit in Honolulu on November 12-13.

“The participation in the APEC summit has a special significance in light of Russia’s forthcoming chairmanship of this regional association,” presidential aide Sergei Prikhodko said.

“Russia will have to pick up the chair’s baton from the United States, … and announce the priorities of APEC activities in 2012,” he said.

Russia will chair the organization in 2012.

Another presidential aide, Arkady Dvorkovich, said the agenda of Russia’s chairmanship will focus on power industry, transport and food security.

Medvedev will meet with his U.S. counterpart Barack Obama on November 12. Prikhodko earlier said Medvedev and Obama will discuss missile defense issues on the sidelines of the APEC summit.

On his way to Honolulu, the Russian leader will stop over in the Far Eastern Russian city of Khabarovsk on Friday, where he will hold a meeting of the State Council presidium dedicated to the role of regions in Russia’s economy modernization.

U.S. believes Russia’s proposals on 2012 APEC agenda reasonablehttp://en.rian.ru/world/20111111/168593973.html

07:38 11/11/2011

HONOLULU, November 11 (RIA Novosti)

The United States believes proposals Russia put forward for discussion by the finance ministers of the Asia-Pacific Economic Cooperation (APEC) forum in 2012 as next year’s APEC chair are reasonable, U.S. Secretary of the Treasury Timothy Geithner said.

Russia will for the first time host an APEC summit in the Far East in September 2012. APEC finance ministers will meet in Moscow next year.

The Russian Finance Ministry’s delegation at the current APEC summit in Honolulu is led by deputy Finance Minister Sergei Storchak. The initiatives Russia submitted in particular include a proposal to increase financial literacy for the population of the Asia-Pacific region.

Russian President Dmitry Medvedev will attend the APEC summit in Hawaii.

Medvedev will meet with his U.S. counterpart Barack Obama on November 12. Prikhodko earlier said Medvedev and Obama will discuss missile defense issues on the sidelines of the APEC summit.

On his way to Honolulu, the Russian leader will stop over in the Far Eastern Russian city of Khabarovsk on Friday, where he will hold a meeting of the State Council presidium dedicated to the role of regions in Russia’s economy modernization.

07:04 11/11/2011ALL NEWS

Russia offers four issues for APEC presidency

http://www.itar-tass.com/en/c154/269169.html

HONOLULU, November 11 (Itar-Tass) —— During its 2012 presidency in APEC Russia will offer for discussion four major financial issues, according to the head of the international relations department of the finance ministry, Andrei Bokarev.

They include enhanced financial literacy of the population, improved financial education, development of treasury systems of APEC countries and their long-term financial stability, and financial aspects in overcoming the aftermath of natural calamities and emergency situations. The latter issue was prompted by the latest cataclysms in Japan and Thailand, Bokarev told reporters on Thursday.

He said the first issue continues the discussion held under the current U.S. presidency in APEC. However Washington speaks about access to financial services for the most vulnerable groups of the population. “It is true and correct, but in Russia we believe it is first necessary to educate people how to use such services and explain related risks and obligations,” Bokarev said.

Another issue taken over from American presidency is the financing of infrastructure and the development of state-private partnership. “APEC countries acknowledge the achieved success is modest in the sphere,” he said. To remedy the situation it is proposed to create a “special mechanism under the aegis of the World Bank.”

Bokarev admitted the infrastructure issue is of significance for Russia as it so far lags behind APEC partners in the quality of infrastructure in logistics and transportation spheres.

Russian dignitaries in town for APEC spend time on the Big Islehttp://www.khon2.com/news/local/story/Russian-dignitaries-in-town-for-APEC-spend-time/3zLk3MdDAE6eV7j9z_S3og.cspx

Russian dignitaries in Hawaii for APEC spent some time on the Big Island today.

The Big Island Visitors bureau greeted the guests at the airport with leis and a bag of hawaiian treats.

On board the Russian plane were the Minister of Foreign Affairs and the U.S. Ambassador of Russian federation, among others.

Before leaving for Oahu, the group visited Hawaii Volcanoes National Park, some by air and some on the ground.

US may repeal Jackson-Vanik before 2012http://english.ruvr.ru/2011/11/11/60197881.html

Nov 11, 2011 02:24 Moscow Time

US Congress needs to move quickly and vote to repeal the Jackson-Vanik amendment.

A Department of Commerce representative, speaking on condition of anonymity, said on Thursday that Russia’s joining the WTO would oblige Washington to grant it the most

favored nation status in trade and that the Obama Administration wants to see this done already before this year is out.

(BBC)

11.11.2011

USRBC to work with Congress, Administration to lift Jackson-Vanik as Russia joins WTOhttp://www.oilandgaseurasia.com/news/p/0/news/13542

The U.S.-Russia Business Council stated that it would work hard to lift  the Jackson Venik amendment, as the country joins WTO.

To ensure that U.S. firms enjoy the full benefits of Russia's accession, it will be necessary for the U.S. Congress to lift the Jackson-Vanik amendment with respect to Russia and authorize the President to extend Permanent Normal Trade Relations (PNTR) to Russia, USRBC President Edward Verona said in the statement Thuersday.

"The USRBC, which leads the Coalition for U.S.-Russia Trade, looks forward to working with the Administration, members of Congress, the broader business community and other stakeholders to ensure that this is accomplished at the earliest opportunity. We need to keep opportunities for U.S. interests on par with those that our European and Asian competitors will enjoy,"  Verona added

"Russia is an important market for many U.S. companies and WTO accession will help enhance the U.S.-Russia commercial relationship," added Klaus Kleinfeld, USRBC Chairman and Chairman and CEO of Alcoa, Inc.

The U.S.-Russia Business Council (USRBC) represents the interests of its 250 U.S. and Russian member companies, providing business development and government relations support in both Moscow and Washington. 

November 11, 2011 12:11

Russia to be invited to WTO Dec. 15-17 - Obamahttp://en.rian.ru/world/20111111/168592163.html

05:13 11/11/2011

WASHINGTON, November 11 (RIA Novosti)

The United States expects Russia to receive an official invitation to join the World Trade Organization (WTO) in mid-December, President Barack Obama said in a statement on Thursday.

Earlier on Thursday the WTO Working Party on Russia’s accession approved the package spelling out Russia’s terms of entry to the organization. The last remaining obstacle for Russia’s entry was removed on Wednesday when Russia and Georgia signed a deal clearing the way for Moscow’s WTO admission.

“The outcome of today’s Working Party meeting is the last step before WTO ministers approve these terms and invite Russia to become a WTO member, which we expect to take place at the WTO ministerial conference on December 15-17, 2011,” Obama said.

“I congratulate President [Dmitry] Medvedev and his government for completing negotiations on the terms and conditions for Russia’s accession to the WTO, which were adopted today,” the U.S. leader said.

“After nearly two decades of negotiations, Russia will now be able to join to the WTO,” he said.

The Working Party will now send its accession recommendation to the December 15-17 Ministerial Conference, where ministers are expected to approve the documents and accept Russia as a WTO Member.

Russia will have until June 15, 2012 to ratify its accession package. Russia will become a full-fledged member of the WTO thirty days after the accession documents are ratified by the Russian parliament.

“Russia’s WTO accession would be yet another important step forward in our reset of relations with Russia, which has been based upon the belief that the United States and Russia share many common interests, even as we disagree on some issues,” Obama said.

Russia, the only major economy outside the WTO, has been trying to join the organization since 1993. The agreement of all member states is necessary for accession to the WTO, but Georgia refused to approve Russia's entry ever since the two countries fought a brief war in August 2008.

Russia and Georgia finally signed a Swiss-brokered agreement clearing the way for Russia’s WTO admission on Wednesday, including deployment of international observers to monitor the movement of goods across sections of Russia’s borders with the former Georgian republics of Abkhazia and South Ossetia.

05:04 11/11/2011ALL NEWS

WTO chief sees win-win situation in Russian membership

http://www.itar-tass.com/en/c154/269143.html

GENEVA, November 11 (Itar-Tass) —— WTO Director General Pascal Lamy welcomed the conclusion of 18-year old talks on Russian accession to the organization as a win-win situation.

“Naturally, broader possibilities for access to the Russian market will bring benefits to trade partners, but they also mean clear benefits for Russia. This win-win result will bring Russia more firmly into the global economy and make it a more attractive place to do business,” he told Tass in an interview on Thursday.

“Better openness, transparency and predictability of the Russian economy will improve the climate for proper governance and will increase investments and growth,” Lamy added.

Russian trade partners who could unilaterally raise tariffs on Russian export commodities can no longer do that according to WTO rules, he said.

“Foreign investors will view Russia as a more attractive place for investments. Moreover, the investors will be convinced that Russia has taken on the same transparent and predictable rules as other WTO members. I am convinced Russia will soon begin to play a role in the WTO which is commensurate with its size and trade might,” Lamy said.

WTO unites 153 countries which account for 95 percent of the global trade turnover. Russian accession will raise the figure to 98 percent.

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November 10, 2011 8:25 pm

Russia to cut tariffs ahead of WTO entry

By Charles Clover in Moscow

Russia has agreed to slash tariffs, get rid of industrial subsidies, and allow foreign companies greater access to its domestic market in a big overhaul of the economy due to follow its entry into the World Trade Organisation expected next year.

On Thursday, Moscow completed 18 years of negotiation for entry into the trade body. The deal is expected to get final approval from WTO trade ministers in December, setting Russia up for formal membership starting in 2012.

The most important concessions offered by Russia, according to experts, are in market access for foreign service sector companies and banks, which were eagerly sought by European Union states.

The Kremlin agreed that in the years following accession, foreign telecommunications companies will no longer be limited to 49 per cent equity in Russian businesses, while foreign bank will be allowed to establish subsidiaries, with no cap on foreign capital participation in individual Russian banks.

The agreements will help Russia raise investment abroad and counter the perception that the country is a bad place to invest, offering “good housekeeping seal of approval” in the words of one analyst.

"The WTO quality label is extremely important for international investors and that's one which now Russia deserves," WTO chief Pascal Lamy told a news conference in Geneva on Thursday.

Experts said, however, that despite a few headline concessions, Russia was generally able to drive a hard bargain because of the lack of any countervailing leverage over its exports by importing countries: Russia exports mainly oil and gas, which no country is keen to level tariffs on.

Fyodor Lukyanov, the editor of Russia in Global Affairs, said the final log jam in negotiations, which had been dragging on for 18 years, were finally broken by the world’s economic crisis. “[after the crisis] western countries had a bigger stake in Russia joining the WTO. They decided that it would be better to have greater access to the Russian market. that it would be better to lock Russia in with its rules.”

Russia’s agreed reduction in tariffs are modest: the WTO estimated these would fall to an average of 7.8 per cent from the 2011 level of 10 per cent in the years after accession.

“These tariff reductions are not going to break the bank” said Hosuk Lee Makiyama, director of the European Centre for International Political Economy in Brussels.

Mr Lukyanov said “The significance of the WTO for Russia is rather overexaggerated. Some people have said Russian entry will just destroy the Russian economy and there are people who say it will change everything. In fact the changes will be slow and not very noticeable.”

Thursday’s agreement was made possible by a last minute deal announced on Wednesday between Russia and Georgia, the last WTO member to hold out on agreeing to Russia’s entrance. The two countries fought a brief war in 2008.

Despite the good feelings generated by Thursday's announcement, there were still disagreements – experts took issue with the announcement by the WTO that Russia had agreed to cut auto tariffs from 15 per cent to 12 per cent, according to a fact sheet published Thursday by the organisation.

Aleksey Portansky, a trade economist at the Moscow-based Higher School of Economics insisted that Russia’s current tariff rate was 30 per cent and had agreed to cut it to 15 per cent, which also seemed borne out by a similar announcement by Maxim Medvedkov, Russia’s lead negotiator.

“Its very hard for me to comment on the information that has been published, as I can’t tell what is true” said Mr Portansky.

The WTO said the organisation stood by the figures, however, and the 15 and 12 per cent, respectively, were an average across the sector.

Additional reporting by Catherine Belton in Moscow

Farmers challenged by WTO accessionhttp://rt.com/business/news/https-rtcom-wto-challange-farmers-025/

Published: 11 November, 2011, 12:12Edited: 11 November, 2011, 12:14

Russia has agreed to lower its agricultural tariffs as part of the agreement to join the WTO.

Overall, the tariffs will be reduced by just 3% but timber, wood, grain and milk will be hit by a decrease of over 5%. This may harm Russian farmers who will now have less protection from foreign competitors. But their troubles don’t end there: the Russian government is also expected to decrease its subsidies to the agricultural sector by over 50%.Russia’s total annual subsidies to its agriculture are expected to go down to 4.8 billion dollars by 2018 – less than a third France gives its farmers. Analysts say the step is a double-edged sword: Russian market will get flooded with foreign goods forcing Russian producers to either lower prices or improve quality to compete. Now that the Protocol on Russia’s accession to the WTO has been approved the country is set to join the organization in December.

Impact of Russia's WTO Entry on U.S. http://www.cfr.org/russian-fed/impact-russias-wto-entry-us/p26473

Interviewee:

Stephen Sestanovich, George F. Kennan Senior Fellow for Russian and Eurasian Studies, Council on Foreign Relations

Interviewer: Bernard Gwertzman, Consulting Editor, CFR.org

November 10, 2011

A deal between Georgia and Russia (RT), helped by Swiss mediation, has opened the way for Russia to join the World Trade Organization (WTO). "The Russians are the largest economy not in the WTO," and their accession is important both in economic and political terms, says CFR's Stephen Sestanovich. But for the United States to benefit from Russia's membership in the WTO, he says, Congress must "graduate" Russia from the terms of the 1974 Jackson-Vanik Amendment, which links trade to human rights practices, mainly emigration policies. Economic considerations make it likely for Congress to take this step, Sestanovich adds, but at the same time many members in Congress would like Jackson-Vanik to be replaced with something else that expresses continued U.S. support for democracy and human rights in Russia.

Russia is all set to enter the WTO. Is this a major development for the world economy? Is it a major development in Russia's relations with the rest of the world?

The Russians are the largest economy not in the WTO. Their accession is important in economic terms; it also has significant political interest. A few months ago, I would have predicted that it would be quite hard to solve the big remaining obstacle, which was a political one. And that was that Georgia objected to Russian membership because, in brief, Russia is occupying its territory. It wanted arrangements made that would indicate that South Ossetia and Abkhazia--the Georgian provinces that Russia has recognized as autonomous, independent states following the brief Russian-Georgian war in 2008--are still part of Georgia. And the Russians of course, were in no mood to grant this. So, it looked as though it would be very hard to broker a deal.

In the end, both sides have agreed to a monitoring system (AP) on the Russian-Georgian border across from Abkhazia and South Ossetia, in which an independent contractor, hired by the Swiss government, will monitor and report on trade flows. It's a jerry-rigged arrangement, but the real interest of it is that the Russians agreed to something that does, in fact, imply that there's something fishy in the status of South Ossetia and Abkhazia. And that's what the Georgians wanted. They wanted even the mere suggestion, the merest practical compromise that these were not real countries, and they got it. So it's interesting that the Russians agreed to do this.

Why did the Russians agree?

It suggests both a desire for the economic benefits of WTO membership--recognition that on the question of the status of these two provinces the Russians are totally isolated in the world--and suggests a desire to move beyond the impasse on this question.

The United States has used trade as a weapon against the Russians going back to the Cold War, as with the Jackson-Vanik Amendment to the U.S. Trade Act of 1974. How does Jackson-Vanik get affected by Russia's entry into the WTO?

In the next phase, the [U.S.] administration is going to be pointing out that to get the benefits of Russian membership in the WTO, the United States has to graduate them from Jackson-Vanik. The United States and Russia will not have a full WTO relationship unless the trade is unconditional, and the fact that Jackson-Vanik involves an annual review of Russia's compliance means that it's not unconditional. So what will have to happen in Congress is a vote to remove Russia from the coverage of the Jackson-Vanik Amendment as has happened with most states of the former Soviet Union already.

That vote is an awkward one politically for a lot of members of Congress because on the one hand, they hate to cast a vote that implies that things are going well on the human rights and democracy front in Russia. On the other hand, the economic benefits for the United States are real, and my guess is those economic considerations are likely to prevail. Members of Congress will be hearing from their constituents and lobbyist friends that jobs are involved and exports are involved, and that will probably be a persuasive consideration for them.

Which economic sectors in the United States would benefit the most?

The United States has always exported a lot of chicken and pork, and Russian regulation of those exports was one of the difficult issues to be resolved in reaching an agreement on the WTO. The Russians will now have less basis to complain about the chemicals put into American food products, and so those exports have more of an opportunity to grow.

In general, Russia will be obliged to reduce its agricultural subsidies over the next several years; to reduce its import duties on consumer goods; to reduce tariffs on heavy equipment for agriculture, construction, scientific purposes; and to reduce tariffs on pharmaceuticals, and to make it easier for foreigners to own Russian banks and insurance companies. The United States has an interest in all of these areas and an opportunity to expand its trade and investment in Russia because obstacles will have to be reduced. So the economic benefits for the United States are real here.

There are credible estimates that trade between the United States and Russia could double over the next five years. I should say it doubled between 2005 and 2010 but did take a hit in response to the international economic crisis. It's still not very big, but we have a $20 billion trade deficit with Russia, which we have a chance of closing because WTO accession will give us access to the Russian market.

I assume we're importing mostly Russian oil.

Absolutely. Russian minerals, metals, chemicals are more than 90 percent of their overall exports.

Is this part of the "reset" that was announced by Vice President Biden in the beginning of the administration?

It is part of reset in the sense that the goals that both sides set out when Dmitry Medvedev and Barack Obama became presidents included things like a new START treaty, a WTO accession, and cooperation on a number of other issues. But of course, the WTO problem has been one of very long standing. The Russians first applied to join the WTO in 1993, so this has been an eighteen- year project.

Has Prime Minister and former president Vladimir Putin been behind this? I've read that he's fluctuated.

Putin has been more receptive to the concerns of Russian manufacturers and companies that felt they were going to take a hit as a result of WTO accession. He has always had sort of a nationalist line that we're not going to join the WTO if they insist on a one-sided deal that is tougher than what's imposed on other countries. He did the biggest single backtracking on WTO two years ago when he announced that Russia would only join as part of its customs union with Kazakhstan and others. This set the whole process of accession back more than any other single action in the past eighteen years. The Russians have primarily themselves to blame for the delay. Putin had said more recently that it's a close call, it's sort of fifty-fifty but with the balance tipped in favor for Russia, and that seems to be the way he's playing it now.

So Kazakhstan would not come in on their shirttails?

The whole question of accession for the customs union has been put aside.

To help end Jackson-Vanik, will Georgian President Mikheil Saakashvili have to come to Congress and make a pitch on Russia's behalf? That seems to be the issue, whether the Georgians are happy?

No, the Georgians are now happy because their concern has been that Russian membership should not in any way imply that trade across the border from Russia into South Ossetia and Abkhazia is not trade into Georgian territory. And they've gotten the mechanism now that satisfies them on that point. They want other things from the United States, and they are going to be pushing their case for closer security cooperation between now and the NATO summit next spring in Chicago.

The hard question for Russians and the administration will be whether Congress is prepared to do a so-called "graduation vote"  that is clean, meaning simply to "graduate" Russia from Jackson-Vanik and take no further action. There's a lot of understandable sentiment in Congress that Jackson-Vanik should be replaced with something else that

expresses continuing American support for efforts to democratize Russia, to defend human rights, and so forth.

There are disagreements in Congress about what that replacement legislation should be. There is this so-called Magnitsky bill, which would impose restrictions on entry into the United States and even on assets in the United States of Russian officials who are considered to be human rights abusers. There has been some consideration to setting up a fund which would support civil society groups in Russia. Something of this sort is meant to ease the anxiety that members have when they "graduate" Russia from the coverage of the single most important piece of legislation from the Cold War relating to human rights. They want to feel that there is somehow an expression of continuing concern, a modernization of that policy. They haven't figured out what it should be, but there's a strong interest in taking some steps along these lines.

What happens now? Does the president waive the provisions of that bill each year to allow trade to go on?

No. This is a common misconception. There is a waiver by the president only if a country covered by Jackson-Vanik is not allowing free emigration. Since Bill Clinton, all American presidents have found Russia to be in full compliance with the requirements of Jackson-Vanik. Meaning that there's no waiver, there's merely a report every year to Congress that Russia is in full compliance. But even that report is inconsistent with normal WTO relations.

So right now Russia gets normal tariff treatment but not permanent?

It's called NTR [Normal Trade Relations], as opposed to PNTR, or Permanent Normal Trade Relations (PDF). You may remember the vote that Congress had to take on the question of Chinese accession when they joined the WTO. They were voting essentially in favor of PNTR for China because it too was covered by Jackson-Vanik.

Russia's human rights record is certainly better than China's.

That's true. But of course, Russia pretends to be a democracy and the Chinese are not hypocrites on that point. There's another difference between the Russian and Chinese case. In economic terms, China represented a much more complex and troublesome issue for Americans because essentially what we were looking at was a potential big surge in Chinese exports to the United States from PNTR. What we're looking at from PNTR for Russia is hopefully a surge of American exports to Russia. So the economic benefits are probably a little simpler to describe and more one-sided in our favor.

Weigh in on this issue by emailing CFR.org.

U.S. companies to gain access to huge market with Russia's WTO accession – expertshttp://www.interfax.com/newsinf.asp?id=286569

WASHINGTON. Nov 11 (Interfax) - Russia joining the World Trade Organization will make the country's economy more predictable for investors, and will also allow U.S. companies to move into a huge developing market, experts with the U.S.-Russia Business Council (USRBC) say.

Russia is an important market for many U.S. companies, and its accession to the WTO will help deepen commercial relations between the United States and Russia, Alcoa CEO Klaus Kleinfeld said.

The USRBC welcomes American and Russian negotiators, as well as all parties involved in a complex negotiation process that has led to an agreement that represents the culmination of eighteen years of efforts to get Russia into the world's biggest trade organization, which sets the rules by which business is done, a statement from the Council says.

U.S. companies will gain access to a huge developing market on which their goods and services enjoy a good reputation thanks to high quality, the statement says. This will make the Russian economy more predictable for investors, it also says.

The USRBC represents 250 U.S. and Russian companies and provides services for the development of business and in the support of communication between the governments in Moscow and Washington.

Cf

(Our editorial staff can be reached at eng.editors@interfax.ru)

Russian Industries May Rile WTO by Undermining Trade Pledgeshttp://www.businessweek.com/news/2011-11-10/russian-industries-may-rile-wto-by-undermining-trade-pledges.html

November 10, 2011, 11:38 PM EST

By Jennifer M. Freedman

Nov. 11 (Bloomberg) -- Russia may struggle to implement its World Trade Organization pledges after an 18-year slog to win entry as economists say some local industries will seek to shield themselves from competitors.

A working party on Russian membership yesterday approved a package of documents that include obligations on goods and services and an accession protocol. Membership for the largest nation outside the 153-member WTO will now be put to a vote at a Dec. 15-17 meeting of trade ministers in Geneva.

Russia’s entry will be the biggest step in global trade liberalization since China joined a decade ago, and will boost the country’s $1.5 trillion economy, according to the World Bank. Still, some manufacturing and agricultural companies fear an influx of foreign competition and want time to adjust, potentially delaying adherence to WTO rules.

“Correct implementation of its commitments will remain a major issue and cause continued frictions with Russia’s trading partners,” said Iana Dreyer, an international economy analyst at the Paris-based Institut Montaigne.

Russia’s economy, which expanded 4 percent last year after a record 7.8 percent contraction in 2009, will benefit from WTO entry on the whole, the World Bank said in a report last year. Joining may add 3.7 percent to gross domestic product within five years and 11 percent within a decade, it estimates.

The dollar-denominated RTS Index may jump as much as 20 percent on news of Russia joining the WTO, Ovanes Oganisian, equity strategist at Renaissance Capital in Moscow, wrote in an Oct. 28 report. The gauge has lost 13.9 percent this year.

‘Bad Manufacturing’

Aside from energy and metals, few Russian goods are competitive, according to Anders Aslund, a fellow at the Peterson Institute for International Economics in Washington. Joining the WTO may wipe out “bad manufacturing,” he said.

Opposition initially arose from “old Soviet industries that should have been closed down anyway,” said Aslund, an adviser to the Russian government in the early 1990s. This includes aviation, which is “close to dead,” and car production, he said by phone on Nov. 4.

The agriculture industry isn’t fully behind accession either, because of a WTO rule that caps state aid to farmers and fears over sanitary requirements for importing chicken, pork and beef, Konstantinos Adamantopoulos, a trade lawyer at Holman, Fenwick & Willan in Brussels who advised the Russian government on accession said by phone on Nov. 4.

Russia’s main task will be to prevent a surge in low- quality or excessively cheap imports, according to Andrei Danilenko, head of Russia’s National Milk Producers Union.

Protective Measures

“Joining the WTO really won’t be good for Russian agriculture if officials don’t use all possible measures under WTO rules to protect our market,” he said by phone yesterday. “Our agriculture sector gained during the last few years thanks to various protective tariffs, and we shouldn’t give up those results now.”

Increased competition will trigger the downfall of less- efficient companies, according to Sergei Mikhailov, chief executive officer of meat producer Cherkizovo Group. Farm subsidies “shouldn’t be reduced and should even increase after accession,” he said Nov. 9.

In an early sign of friction, U.S. lawmakers said this week that Russia’s government may be backing away from a promise to join the Information Technology Agreement, which eliminates tariffs on many high-technology goods, as part of its accession.

Russia sees little trouble in implementing its WTO pledges.

“Will it be difficult for us to implement our commitments? I don’t think so,” Russia’s chief WTO negotiator, Maxim Medvedkov, told a news conference in Geneva yesterday. “Most of our businesses are in favor of accession.”

Consumers to Benefit

With oil and gas, which account for more than half of Russian shipments overseas, not subject to export tariffs, metals and chemical producers will gain as levies to sell their products abroad decline, according to the World Bank.

Russian consumers also stand to benefit as import barriers are reduced, a step that will spur the flow of goods into the country, weakening the ruble and further helping exporters, the World Bank said.

Shares in natural-gas producers such as OAO Novatek, OAO Rosneft and OAO Lukoil are likely to advance as entry may spur a possible removal of state-run OAO Gazprom’s monopoly on exports of the fuel, Renaissance’s Oganisian said.

Rather than fail, Russia’s less-efficient industries may accelerate their development as a result of WTO accession, according to Chris Weafer, chief strategist at Troika Dialog in Moscow, who cited other members’ experiences.

“Local companies have had no choice but to raise their game to compete with established international operators,” he said on Nov. 3.

‘Tipping Point’

The auto industry, which first resisted membership, has dropped its opposition as Russia sought to encourage carmakers such as Ford Motor Co. and Renault SA to start local production. Entry may be a “tipping point” for modernization in Russia, where car production will triple to about 3 million annually within five to 10 years of accession, Aslund said.

While membership won’t bring a “massive gain” to Russia, it sends a “vibrant and significant message to the global community” that the country meets WTO standards, said Christine Lagarde, managing director of the International Monetary Fund.

“It’s a plus economically and, more importantly, politically,” she said in a Nov. 7 speech in Moscow.

Last Obstacle

The U.S. and the European Union have repeatedly voiced their support this year for Russia’s WTO membership, with the EU reaching a final bilateral agreement on entry last month. The final barrier to joining, approval by Georgia, the former Soviet republic with which Russia fought a five-day war in 2008, was overcome this week.

While there may be long-term benefits to accession, the immediate consequences for companies’ operating environments isn’t clear, Anton Bazulev, spokesman for Russia’s third-largest steelmaker, OAO Novolipetsk Steel, said yesterday.

Quotas limiting Russian rolled-steel exports to Europe to 3.2 million tons a year will be abolished upon entry, he said by telephone yesterday. At the same time, “the EU will be free to impose other trading restrictions, including anti-dumping measures,” Bazulev said.

--With assistance from Henry Meyer, Marina Sysoyeva, Ilya Khrennikov and Alena Chechel in Moscow. Editors: Andrew Langley, Balazs Penz

To contact the reporter on this story: Jennifer M. Freedman in Geneva at jfreedman@bloomberg.net

To contact the editor responsible for this story: James Hertling at jhertling@bloomberg.net

NOVEMBER 11, 2011

WTO Entry to Benefit Russian Economy http://online.wsj.com/article/SB10001424052970203537304577030343369050600.html

By SUDEEP REDDY

The World Trade Organization cleared the way on Thursday to bring Russia into the fold, a move that would tie the nation into a global system of open markets and binding trade rules.

The latest step, approved by a key WTO negotiating panel, follows an 18-year effort to bring Russian trade practices in line with international policies governing 153 other nations. It is designed to open Russian markets to foreign competitors by cutting tariffs and breaking down trade barriers.

It also boosts the power of an organization increasingly called upon to mediate trade disputes around the world, including mounting tensions between the U.S. and China.

Russia will become the last member of the Group of 20 industrial and developing economies to join the WTO, the most significant entry since China joined a decade ago.

"It clearly marks a turning point," said Pascal Lamy, director-general of the Geneva-based organization, in an interview. "One way to reinforce the rules is to extend the perimeter of rules on this planet."

Russia, which has been trying to join the group since 1993, agreed to concessions on tariffs and other trade policies to win the approval. Officials are expected to rubber-stamp the deal next month at a WTO ministerial meeting.

The move comes as U.S. lawmakers and Republican presidential candidates, worried about global economic threats amid slowing growth, are calling for the Obama administration to use the WTO to challenge China and other countries that they say aren't following international rules.

President Barack Obama, in a statement Thursday praising Russia's latest step, stressed the benefits to U.S. exporters and the ability to press Moscow on rules governing intellectual property and other rights.

"Russia's membership in the WTO will lower tariffs, improve international access to Russia's services markets, hold the Russian government accountable to a system of rules governing trade behavior, and provide the means to enforce those rules," he said, calling it a "significant day for U.S.-Russia relations."

While the U.S. signed off on the deal, it still must remove a key barrier: A Cold War-era provision, known as the Jackson-Vanik amendment, that limits trade with Russia. Lawmakers have mostly used the provision to exert pressure on foreign policy related to Russia, such as human-rights issues, and it could draw more attention if tensions with Moscow flare during an election season. The Obama administration said it plans to press Congress to repeal the law. Otherwise, U.S. companies could be at a disadvantage in competing for access to Russian markets.

With an economy still heavily dependent on energy exports, Russia is expected to face a much slower path than China in boosting its trade flows as a result of its WTO entry. The WTO's rules on energy commodities give it limited jurisdiction in the field.

But joining the WTO will force Russia to participate in an international trading system that could alter its business practices over time.

"The biggest event from Russia joining will be to modestly increase the rule of law in Russia, which is pretty weak," said Gary Hufbauer, a senior fellow at the Peterson Institute for International Economics in Washington. "It's really up to the Russians whether they want to go in a more commercial, more market-oriented direction, or whether it continues to be this Wild East economy."

The entry into the WTO will also help advance Russia's diversification in the medium and long run, Mr. Lamy said. "The obvious lesson of experience is that it's a big boost in their modernization, their investment and their business environment," he said. "For WTO members, it's insurance on the other side that the Russian trade regime is now stable, predictable and transparent."

Write to Sudeep Reddy at sudeep.reddy@wsj.com

Russia closes WTO deal – details

http://www.bne.eu/dispatch_text17738

bneNovember 11, 2011

On 10 November 2011, the Working Party on Russia's accession, chaired by Ambassador Stefan Johannesson (Iceland), agreed, ad referendum, on the terms of the country's membership to the WTO by adopting the package containing reforms to Russia's trade regime, and the commitments that Russia undertook to implement as part of its WTO accession.

"It has been a long journey, but today Russia has taken a big step towards its destination of membership in the WTO. In acceding to the WTO, Russia embraces a series of rules and commitments that are the foundation of an open, transparent and non-discriminatory global trading system. This system provides important guarantees for Russia and for the 153 other Members of our organization. This win-win result will bring Russia more firmly into the global economy and make it a more attractive place to do business. For the WTO, it comes as a most welcome deliverable for the upcoming WTO Ministerial Conference and signals anew the relevance and vibrancy of the WTO as an instrument for

international co-operation," said Director-General Pascal Lamy in a press release with more details, which you can be found here.

Main points are:

• Average tariff ceiling for imported agriculture products will be 7.8% compared to 2011 average of 10% for all products. One third of tariffs will be reduced on the date of accession, another quarter will be in place three years later. The longest implementation period is for poultry (8y), aircrafts, motor cars (7y).

• Russia has made commitments on market access in 11 services sectors.

o In telecoms foreign equity limitation will be eliminated.

o Foreign insurance companies would be allowed to establish branches (in 9-years)

o Foreign banks would be allowed to establish subsidiaries (Currently foreign banks can only establish standalone banks with full-scale license)

• No discrimination in transportation tariffs for imported goods

• Quantitative restrictions, such as quotas should conform with the WTO provisions.

• Agricultural subsidies will be reduced from current $9 bn to 4.4bn by 2018

• Russia will use international standards for the development of technical regulation

Citi analyst Ian Colville commented: "The terms do not seem surprising. As we discussed before, Russia has already implemented the major part of changes. The immediate effect will be quite limited, less than 1% in terms of tariff protection. However the long-term impact will be positive mainly because of better technical and tariff regulation."

08:31 11/11/2011ALL NEWS

RF-Georgia WTO agt not question Abkhazia, S Ossetia recognition - Dvorkovich

http://www.itar-tass.com/en/c154/269205.html

MOSCOW, November 11 (Itar-Tass) — The Russia-Georgia agreements on the World Trade Organisation (WTO) in no way call into question the recognition of Abkhazia and South Ossetia, RF presidential aide Arkady Dvorkovich told reporters on Friday.

According to him, the agreement on the establishment of a company that will conduct monitoring in the territory of the two new states, signed between Georgia and Russia “we interpret as in no way affecting the recognition of these two states.” “The independence of Abkhazia and South Ossetia is not questioned in any way,” Dvorkovich said. “It is our opinion,” he added.

Dvorkovich said that the above company will be private, and it would be funded by Russia and Georgia, and the money will be coming to a trust fund from which the money will be transferred to a third country - Switzerland.

Georgia declares its victory over Russia on issue of Abkhazia and South Ossetia

http://abc.az/eng/news/main/59431.html

Baku, Fineko/abc.az. Georgian President Mikhail Saakashvili has stated that the trade regime agreements signed with Russia do not say of Abkhazia and South Ossetia as independent states, but cover the matter of monitoring of the Russian-Georgian border.

In this regard, he expressed a hope that soon the Georgian border guards and customs officers would return to border crossing points - the Psou River in Abkhazia and the Roki Tunnel (the crossing from Russia into South Ossetia) in Tskhinvali region.

Saakashvili says that Russian can negotiate quickly when they find it profitable, not hiding behind a dummy regimes of Abkhazia and South Ossetia.

Aide to the President of Russia Alexander Dvorkovich said that in the opinion of Russia, the agreement signed within the framework of accession to the WTO does not concern the political status of Abkhazia and South Ossetia.

No matter how but U.S. President Barack Obama has already stated that Russia’s application for membership in the WTO will be approved on 15-17 December.

Until 30 June 2012 Russia is expected to ratify agreements with the WTO and join the Organization in 30 days after that.

Then it will reduce the average rate of import duties on agricultural products from 13.2% to 10.8% and for manufactured goods from 9.5% to 7.3%. The final rates of customs duties for more than a third of tariffs will come into force on the date of entry and for another quarter will fall three years later.

The longest period of entry into force of eight years is designed for poultry and seven years for cars, helicopters and civilian aircrafts. After joining the WTO Russian authorities will reduce import duties imposed during the crisis in 2008-9 to their original value.

Russia also pledged to halve in a few years the total amount of subsidies to agricultural enterprises. The support for agriculture in 2012 will be within $9 billion and by 2018 this figure will drop to $4.4 billion. In order to avoid excessive concentration of state support for certain types of agricultural products, Russia agreed to direct no more than 30% of total subsidies for these ends until 2018. The agricultural enterprises of the Russian Federation will not receive export subsidies. In addition, after accession to the WTO Russia will cancel VAT exemption for certain categories of products.

11.11.2011 09:19

03:04 11/11/2011ALL NEWS

Kazakhstan may follow Russia in WTO accession

http://www.itar-tass.com/en/c154/269116.html

MOSCOW, November 11 (Itar-Tass) —— Chief Russian WTO negotiator Maxim Medvedkov believes Kazakhstan is likely to become the next party of the Customs Union to join the World Trade Organization and Belarus would follow suit.

“Members of the Union will join the WTO not as a regional organization but separately,” Medvedkov told Russia Today TV channel on Thursday. “Most likely Kazakhstan will be the next country while Belarus will join the WTO some time later. I know both countries have serious intentions and Russia will support their drive as it also needs them in the WTO framework,” he said.

Medvedkov said enterprises which export steel and chemical products will profit most from the Russian accession to the WTO. However “in the final end it will benefit everyone as in the global economy where we all live there is no sense in preserving customs borders. Protecting the markets with customs duties does not always play a positive role. However even after the admission to the WTO we shall not cancel duties which will be preserved at a level necessary for the creation of favorable conditions for our industry,” Medvedkov said.

The negotiator said the most difficult issues were the natural gas and agriculture. Russia was urged to take on commitments that would raise domestic gas prices. “We could not accept that and we succeeded to agree on other circumstances which will not affect the prices inside Russia,” he said.

A compromise was also reached on agricultural issues. “It allows us to increase financial support to farms during a five-year transition period. In five years we shall return to the current level of subsidies. It will help us modernize Russian agriculture,” Medvedkov said.

Russia is expected to officially join the WTO in the middle of 2012.

Nov 21: Kazakhstan’s Minister of Foreign Affairs Yerzhan Kazykhanov to visit Russia

http://www.prime-tass.com/news/calendar/_Russian_calendar_Key_events_for_November_11/-103/%7BF4120FEE-5F77-4076-AFF8-49D08A0870DC%7D.uif

Azerbaijan: Russia’s accession to WTO not to affect Azerbaijan’s export to this country

http://abc.az/eng/news_11_11_2011_59444.html

Baku, Fineko/abc.az. The Government of Azerbaijan does not see any problems with Azerbaijani exports to Russia, which is expected to become a full member of the World Trade Organization (WTO) in July or August 2012.

Ramiz Hasanov, chairman of the State Committee for Standardization, Metrology & Patents of Azerbaijan, says that Russia’s WTO accession will hardly affect Azerbaijani-Russian trade.

"We and Russia have a bilateral trade agreement, and on its basis mutual trade will continue on the same terms, although Azerbaijan is not yet a WTO member,” Hasanov said.

Already on 16 December the WTO Ministerial Conference should approve Russia’s application for membership in the Organization. Prior to July 2012 Russia is ready to ratify all the agreements with the WTO, and in 30 days after that it becomes a WTO member.

 

EU: Russia Using Energy as Diplomacy 'Weapon' http://www.rigzone.com/news/article.asp?a_id=112531

by  Alessandro Torello|Dow Jones Newswires|Thursday, November 10, 2011

BRUSSELS (Dow Jones Newswires), Nov. 10, 2011

Russia is using its natural gas as a "weapon" in international relations, the European Union's energy chief said Thursday, underscoring again how energy relations between the two countries are becoming increasingly tense.

"Putin is not interested in having a new Red Army, he sees energy as being his weapon," Guenther Oettinger said during an event about Europe's energy security at the European Parliament. The EU has to recognize that quickly and react jointly, he said.

Outside experts have long said that Russia's new foreign policy tool is its gas, but top EU officials have rarely used such stark language in public. Pressed by journalists, Oettinger, who has a reputation as one of Brussels' more outspoken officials, specified that his words were just aimed at providing a picture of the situation.

There has long been friction on energy between Russia and Brussels, where some officials remain leery after conflicts between Russia and the Ukraine disrupted some shipments to Eastern Europe in recent years. The European Commission, which has executive and antitrust powers in the EU, has been pushing member countries to implement new rules to liberalize its natural gas market and break the grip that energy majors have on it.

This also means eroding OAO Gazprom's (GAZP.RS) position in Europe and forcing the company to loosen its control over pipelines that import Russian gas to Europe, something that Moscow has seen as a threat to its investments.

The situation has been exacerbated by an antitrust investigation launched by the European Commission against energy companies in eastern Europe based on the suspicion that they were partitioning markets, preventing competitors from using networks and imposing excessive prices. Gazprom's deputy chief executive publickly slammed the EU investigation earlier this week.

At the same time, the EU is likely to be more and more dependant on Russian gas in the foreseeable future as some European countries retreat from nuclear power.

Oettinger himself acknowledged Tuesday --as he was inaugurating the opening up of a new gas pipeline from Russia to Germany-- that Russia is expected to further increase its gas shipments to Europe in the longer-term to around 200 billion cubic meters a year from around 125 bcm now, or some 25% of the EU's gas consumption.

Copyright (c) 2011 Dow Jones & Company, Inc.

Abkhaz deputies to monitor South Ossetian electionshttp://vestnikkavkaza.net/news/politics/19814.html

Abkhaz MPs Vitaly Smyr and Yuri Sukhba will monitor South Ossetian presidential polls and a referendum on the status of the Russian language as international observers, Ossetia.ru reports.

South Ossetian Chairman of Parliament Zurab Kokoyev invited the deputies. They arrived in Tskhinvali, the capital of South Ossetia. Vitaly Smyr is a Deputy Chairman of the Parliamentary Committee for Budget, Credit Organizations, Taxes and Finances. Yuri Zukhba is a Deputy Chairman of the Committee for Legislature, Court-Legal Reform and State Construction.

Kudankulam N-Plant: Nuclear watchdog asks for additional safety measures

NDTV Correspondent, Updated: November 11, 2011 12:04 IST

Read more at: http://www.ndtv.com/article/india/kudankulam-n-plant-nuclear-watchdog-asks-for-additional-safety-measures-148852&cpNew Delhi:  "Safest in the world" is the argument that the Centre and experts have used to counter opposition to the Kundankulam nuclear power plant in Tamil Nadu. But the authorities may now have some more work to do, with the Atomic Energy Regulatory Board (AERB) asking for additional safety measures following a new post-Fukushima assessment.

The nuclear watchdog has demanded additional safety precautions like mobile diesel electricity generating sets which can be rapidly deployed in case the power fails like it did in Japan. The regulator has also sought increasing the available inventory of fresh water needed for emergency cooling.

Protests over safety concerns have stalled work on the R 13,700-crore project for over a month now. Anti-nuclear activists want the power plant to be shut down and converted to a gas-based power plant.

AERB chairman Dr S S Bajaj has suggested "augmenting additional safety measures" though the existing design was robust and could withstand tsunamis and earthquakes.

Head of the nuclear complex, Kashinath Balaji of the NPCIL, said, "Additional diesel generating sets and additional water will be provided and a road map on how that will be implemented has been prepared...These are required for increasing the defence in depth at

the already safe nuclear reactors ."

Former President and one of the country's top scientists APJ Abdul Kalam has given a resounding thumbs-up to the nuclear plant. Giving a clean chit to safety measures, Mr Kalam had suggested a 10-point development plan for the people of the area.

The Deputy Chief of the Russian Mission at Kudankulam, nuclear engineer Kvasa Alexander had told NDTV that these two Russian-made reactors were among the safest in the world. He had said these were more than 99 per cent ready but "many jobs" would have to be repeated because of this delay.

Delay in operationalizing the nuclear reactors at the Kudankulam power plant in Tamil Nadu may also damage them, Mr Alexander had said.

The 2 X 1000 MW nuclear power plant is being built by Nuclear Power Corporation of India Ltd (NPCIL) with Russian technology and equipment.

Read more at: http://www.ndtv.com/article/india/kudankulam-n-plant-nuclear-watchdog-asks-for-additional-safety-measures-148852&cp

Bout wants to ask Russia to pass his case to international court - newspaperhttp://en.rian.ru/society/20111111/168594309.html

07:49 11/11/2011

MOSCOW, November 11 (RIA Novosti)

Convicted Russian arms dealer Viktor Bout plans to ask Russian authorities to pass his case to an international court, the Kommersant daily reported.

On November 2, a jury in Federal District Court of New York found Bout, a former Russian Army officer, guilty of conspiracy to kill U.S. officials and citizens, to acquire and use anti-aircraft missiles and to provide support to terrorists.

“I hope for assistance from my relatives and friends. But what can Viktor Bout do against the entire U.S. machine? Who can stand against it? I plan to ask the Russian authorities to pass my case, on my behalf, to an international court,” Bout told the newspaper.

Bout’s sentence is expected to be announced on February 8. He could receive a life sentence.

Bout was arrested in Thailand in March 2008 during a sting operation led by U.S. agents and extradited to the U.S. in November 2010 after spending more than two and half years in Thai prisons.

Russia’s Foreign Ministry earlier said it will push for Bout’s return using all available means.

02:03 11/11/2011ALL NEWS

Russia set to have convicted Bout back home

http://www.itar-tass.com/en/c154/269106.html

MOSCOW, November 11 (Itar-Tass) —— Russia will work to have its citizen Viktor Bout convicted in the United States back home, the foreign ministry said on Thursday after a meeting of its envoy for human rights, democracy, and the rule of law Konstantin Dolgov with the leadership of the U.S. embassy in Moscow.

“Russia will continue to use all available political, diplomatic, and legal means to ensure the return of the Russian citizen to Russia. The given problem will remain a major aspect of the Russian-U.S. dialogue until it is resolved in a satisfactory manner and in compliance with the norms of the international law and legislation in the sphere of human rights,” the Russian foreign ministry said.

“The Russian side confirmed its position of principle about the unlawfulness of the extradition of the Russian citizen from Thailand to the United States and the ongoing unprecedented psychological pressure on him which puts into doubt the objectiveness of the whole trial of our citizen. Specific attention was paid to the information available in Moscow about further deteriorating custody conditions for Viktor Bout after the jury passed a guilty verdict,” the ministry said.

Russian human rights commissioner discusses Bout's future with US diplomatshttp://en.infosud.ru/news/20111111/257254751.html

11:24 11/11/2011

MOSCOW, November 11 - RAPSI. The Russian Foreign Ministry's envoy on human rights, democracy and rule of law Konstantin Dolgov discussed the future of Viktor Bout with Moscow U.S. Embassy executives on Thursday, the Foreign Ministry reported.

Russian entrepreneur Viktor Bout, who was arrested in Thailand and extradited to the United States, faced his sentence last week.

The jury returned guilty verdicts on all four accounts related to a conspiracy to kill Americans and U.S. officials, illegal acquisition and export of surface-to-air missiles, and support of terrorism. The court is expected to pass a sentence to Bout on February 8. He faces from 25 years to life in prison.

"Russia has confirmed its principle position that the extradition of Russian citizen Viktor Bout from Thailand to the United States and the continuing unprecedented psychological pressure were unlawful. This puts in question the absence of bias in the entire trial. Special attention has been paid to the information that after the jury's verdict was published, Bout's confinement conditions have further deteriorated," the report reads.

Dolgov emphasized that Russia will continue to seek Bout's return back home using all the political, diplomatic and legal means available.

‘Why foster false hope?’http://rt.com/politics/press/kommersant/trial-farc-us-bout/en/

Published: 11 November, 2011, 08:38Edited: 11 November, 2011, 08:47

Viktor Bout gives an interview to Kommersant from the Metropolitan Correctional Center (MCC) in New York. Kirill Belyaninov (New York)

The defense counsel of Russian businessman Viktor Bout, who was convicted in the US of conspiracy to sell heavy weaponry to the Columbian rebel group FARC, plans to appeal the trial results.

The jury foreman’s acknowledgement that she saw the Hollywood production of The Lord Of War, in which the protagonist’s role was inspired by Viktor Bout, could serve as the reason for the appeal. According to the businessman’s counsel, this acknowledgement indicates that the jury may have been biased against the defendant and, while deliberating the verdict, had a preconceived notion of guilt. In his first post-trial exclusive interview with Kommersant, Viktor Bout has agreed to comment on the prospects of a new trial (the handwritten copy of responses can be found on www.kommersant.ru).     

- “Attorney Albert Dayan said that he will soon file an appeal, challenging the conviction and requesting a new trial. Is this issue being discussed with you?”

- “Yes the issue has been discussed immediately after the verdict was issued on November 2, 2011. It’s very hard for me to assess the prospects.”

- “Observers have noted that the jury took only four hours to deliberate. In your opinion, how convincing was the prosecution’s case?”

- “The case was simply falling apart. All files, records, and testimonies confirmed one thing: that I was simply planning to sell aircraft (the prosecution’s main argument centered around the idea that Bout was communicating with FARC in order to sell two aircraft, and discussed weapons in order to interest the clients – Kommersant).

- “According to many journalists, who were present during the trial, your attorney was often less-convincing than the prosecution. He often got lost, confusing names and dates, taking breaks to find necessary documents. How do you assess his work?”

- “I consider the work of my attorneys to be excellent; in my opinion, they have won this case.”

- “During your extradition from Thailand, US Drug Enforcement Administration (DEA) agents had offered you a plea bargain agreement. Some sources say that the court-appointed attorney Sabrina Schroff, whose services you later rejected, had also insisted on cooperating with the investigators. Has the prosecution tried making a similar offer during the trial?”

- “No, it hadn’t.”

- “In the summer of 2007, well-known arms dealer Monzer al-Kassar was arrested in Spain and extradited to the US. A person involved in this operation was secret agent Carlos Sagastume, who also testified against you. Meanwhile, al-Kassar’s case closely matches yours: DEA informants had also posed as FARC members when communicating with him. In the course of the trial, many were puzzled by how information about the al-Kassar case could have gone unnoticed by you and why you agreed to start negotiations with the FARC impostors just four months after his arrest. Do you know anything about this?”

- “Yes, I know about the al-Kassar case – we used it in trial preparations.”

- “How do you see your future prospects? Are you planning to ask for help from the Russian authorities?”

- “My prospects are – from 30 years to life in a high-security prison, in solitary confinement with no chance for amnesty. I have a lot of hope in the help from family and friends. But what can Viktor Bout do against the entire US machine? Who is able to confront it? I plan to address the Russian authorities with a request to submit the case to the International Court on my behalf.”

- “Have your confinement conditions changed since the verdict was issued?”

- “Conditions have not changed after the verdict: the same 24-hour isolation cell, shackles, chains, handcuffs, and three security guards during every relocation.”

- “Prior to the trial, you told Kommersant that you have not been engaged in airfreight since 2001. At the same time, prosecution had argued that you had actively conducted business in the sphere of cargo transfers, and in November-December of 2007 you had even negotiated the purchase of new aircraft.”

- “Yes, I have not been in the air transport business since 2001. I was selling the aircraft that remained following the closure of companies in the UAE and Africa. No evidence was presented showing my involvement in airfreight.”

- “Former UN arms-trafficking expert Kathi Austin argues that, back in 1999, you were involved in supplying a vast amount of weapons to the Columbian FARC. Is this true?”

- “There have never been any cargo deliveries to FARC. These are rumors and speculations.”

- “After the jury issued its verdict, a number of Russian media sources considered the possibility of swapping you for a US citizen, under arrest in Russia. In your opinion, how realistic is this possibility?”

- “I’m not denying the possibility of an exchange. But I just don’t understand – why foster false hope?”

Russia supplies Nicaragua with Lada Kalinashttp://english.ruvr.ru/2011/11/11/60202424.html

Nov 11, 2011 09:44 Moscow Time

Russia has delivered another batch of 550 Lada Kalina cars to Nicaragua.

The cars are being supplied as part of a project to renew the country’s taxi fleet.

Taxi driver cooperatives will acquire Lada Kalinas by installments for affordable prices, the Russian Embassy says.

The previous batch of 540 cars was delivered to Managua earlier and another 1,000 will arrive next year.

RIAN

Russia Says Ukraine Claims No Of USSR's Abroad Property

http://un.ua/eng/article/360065.html

(09:05, Friday, November 11, 2011)

Russia states that Ukraine claims no of the former USSR's abroad property, reads a statement made by the press service of the Russian Foreign Affairs Ministry, citing Alexander Lukashevich, an official representative of the Russian Foreign Ministry, as saying on November 10.

"The Russian party almost in all states re-registered USSR's property for itself. The Ukrainian party no longer raises the question of providing 'third countries'' facilities for its diplomatic missions," he said.

Lukashevich remarks, in Russia's opinion there is no USSR's property abroad and no negotiations are conducted on this question, with Ukraine either, despite it never ratified the treaty on 'zero variant' (the accord under which Russia undertakes all the ex-USSR's debts and the rest of former Soviet Republics refuse from claims to any USSR property).

As Ukrainian News earlier reported, former (2005 - 2010) President Viktor Yuschenko in 2009 instructed five ministries, the Security Service of Ukraine and the Foreign Intelligence Service to evaluate potential consequences of Ukraine's withdrawal of signature under the treaty with Russia on settlement of the questions of succession of the external public debt and assets of the former USSR ('zero variant') and the risks borne by its ratification by the Verkhovna Rada.

In 2007, the Ukrainian Foreign Affairs Ministry asserted the need of receiving from Russia official information about item-by-item composition, balance-sheet and market value of the USSR property abroad, and resumption of the talks on its division.

Ukraine in 2006 assumed settlement of succession of the external debt and assets of the former USSR between Ukraine and Russia by the UN International Court of Justice.

Ukraine's portion in the total sum of debt and assets makes 16.37%.

RF hands over chair in Council of Heads of CIS Chambers of Commerce to Tajikistan.http://en.trend.az/capital/business/1955618.html

11 November 2011, 10:38 (GMT+04:00)

Russia has ended its term as a chair in the Council of Heads of Chambers of Commerce and Industry from the Commonwealth of Independent States (CIS) and handed over the chair to Tajikistan, Itar-Tass reported.

"The last year was very fruitful. We have done a lot," Sergei Katyrin, the chairman of the Russian Chamber of Commerce and Industry, said at a 9th session of the Council. "We hope the next meeting will tackle issues of concern for both businessmen and the Chamber, such as electronic document turnover, migration policies, etc."

Chairperson of CIS Chambers of Commerce and Industry reported about top-priority areas of the activity of their organizations. Special attention was paid to the problem of the issuance of certificates of origin and vesting such authorities in state bodies. If made, such a step may give a breeding ground for corruption in the area of external trade.

Participants in the meeting also discussed closer cooperation between national chambers of the CIS countries with regional mass media, exhibitions, and other issues.

Russia handed over the chair in the Council to Tajikistan. The next meeting of the Council will be held in October 2012 in the Tajik capital of Dushanbe.

The Council of Heads of Chambers of Commerce and Industry from the Commonwealth of Independent States was set up in 2002 in Moscow. Its basic goal is to support legal entrepreneurship in the CIS countries. The Council embraces Russia, Armenia, Belarus, Kazakhstan, Kyrgyzstan, Moldova, Tajikistan, and Ukraine.

Youth movement activists to picket Tajik Embassy in Moscow on November 14 http://www.interfax.co.uk/

11/11/11 8:45AM GMT

MOSCOW. Nov 11 (Russia News) – Youth movement activists plan to picket the Tajik Embassy in Moscow on Monday to protest the sentencing…

Russian ambassador to return to Tajikistan by Mondayhttp://en.trend.az/regions/world/russia/1955638.html

11 November 2011, 12:41 (GMT+04:00)

Azerbaijan, Baku, Nov. 11 / Trend /

Russian Ambassador to Tajikistan Yuri Popov went to Moscow to hold brief consultations at the Foreign Ministry in connection with Russian pilot Vladimir Sadovnichiy's case, a source at the Russian Foreign Ministry told RIA Novosti on Friday. He will resume his duties on Monday.

Earlier, Counsellor of the Russian Embassy in Dushanbe Vladimir Vaniev said Mr.Popov went to Moscow after meeting with Tajik President Emomali Rahmon, to have discussions over pilot Sadovnichiy's verdict.

"Given the situation over the Russian pilot, the Russian ambassador in Dushanbe was summoned for brief consultations to the Russian Foreign Ministry and will return to his duties on Monday," the source said

Pilot Sadovnichiy and his Estonian counterpart Alexei Rudenko were sentenced to eight and a half years in prison in Tajikistan on November 8, when they were found guilty of smuggling, illegal border crossing and violating flight rules. The verdict has caused a backlash in Moscow and the Russian Foreign Ministry has called it 'extremely harsh and politically engaged'.

Do you have any feedback? Contact our journalist at agency@trend.az

Tajikistan ready for talks, Moscow threatens deportations over jailed pilothttp://en.ria.ru/world/20111111/168596798.html

10:36 11/11/2011

DUSHANBE, November 11 (RIA Novosti)

Tajikistan is willing to resolve the situation around a convicted Russian pilot that has soured relations between the two countries, a Russian diplomatic aide said on Friday.

Russian pilot Vladimir Sadovnichy and his Estonian colleague Alexei Rudenko were sentenced to eight and a half years in jail in Tajikistan on Tuesday for smuggling and border violations. Moscow called the sentence “politically motivated,” threatened to expel some 200 Tajik migrants and called the Russian ambassador back to the capital for consultations.

“The Tajik side expressed its readiness to resolve the situation to prevent the further aggravation of bilateral relations,” Vladimir Vaniyev, a diplomatic aide in the Russian Embassy in Tajikistan said following a meeting between Ambassador Yury Popov and Tajik President Emomali Rakhmon on Thursday night.

Popov flew to Moscow on Friday morning for consultations with the Foreign Ministry, Vaniyev said.

Following the Tajik verdict on the Russian pilot, Russia decided to retaliate and deport 100 Tajiks from the country over legal violations, Konstantin Romodanovsky, Russia’s top migration official, said on Friday.

“The Federal Migration Service is ready to send back about 100 Tajiks who committed legal offences,” he said, adding that another 134 Tajiks could be deported as well for improper documents.

A diplomatic source said this measure was “Russia’s asymmetric response” to the Tajik authorities’ decision.

Two planes with Sadovnichy and Rudenko as crew commanders were returning from Afghanistan where they had delivered humanitarian aid in March. They had permission to fly via Tajikistan but Tajik traffic controllers said they had no confirmation on land and asked them to return to Kabul. The planes did not have enough fuel and had to land in Tajikistan regardless.

Tajik authorities based their smuggling charges on the fact that the pilots had an unassembled engine onboard, which they said they were using as spare parts.

November 11, 2011 11:07

Dushanbe wants to sort out situation with convicted pilots - Russian diplomathttp://www.interfax.com/newsinf.asp?id=286548

DUSHANBE. Nov 11 (Interfax) - Tajikistan has no intention of dramatizing the situation sparked by the sentencing of a Russian air carrier's pilots by a Tajik court, and it wants to find a solution, advisor to the Russian Embassy in Dushanbe Vladimir Vaniyev told Interfax on Friday.

"The authorities in Dushanbe have said they want to sort out the situation surrounding the Russian pilots as soon as possible in order to stop allied relations between our countries from growing worse," he said.

tm rb

(Our editorial staff can be reached at eng.editors@interfax.ru)

Russian Ambassador to Tajikistan leaves for Moscow for consultationshttp://en.trend.az/regions/world/russia/1955608.html

11 November 2011, 10:30 (GMT+04:00)

Russian Ambassador to Tajikistan Yuri Popov has left for Moscow for consultations on Friday, CA-News reports with reference to sources in diplomatic circles.

It is reported that President of Tajikistan Emomali Rahmon received Popov in late Thursday evening. The meeting discussed the Kurgan-Tube city court's verdict towards two crew commanders of military transport aircrafts AN-72 of Airline Rolkan investmens Ltd - Russian Vladimir Sadovnichy and Estonian Alexei Rudenko, who were sentenced to 8.5-year imprisonment on charges of smuggling, illegal border crossing and violation of international flights rules.

Sources say that at this meeting Tajik side expressed its willingness to resolve these problems within the framework of the constitutional norms of the republic, and based on the decisions of higher courts.

On Friday, the defense intends to appeal against the decision of the court of the first instance, which has become "an irritant" in the "strategic partnership" between Tajikistan and Russia.

10:06 11/11/2011ALL NEWS

Russia ambassador, Tajik president discuss Russian pilot situation

http://www.itar-tass.com/en/c154/269280.html

DUSHANBE, November 11 (Itar-Tass) —— Russian Ambassador to Tajikistan Yuri Popov met with Tajik President Emomali Rakhmon over the situation of the pilots of the Russian air company on Thursday evening, informed sources in the Tajik government told Itar-Tass on Friday.

The sources did not comment on the agenda of the meeting, noting that it was confidential and “the fate of Russian citizen Vladimir Sadovnichy and Estonian citizen Alexei Rudenko was discussed.”

November 11, 2011 09:47

Dushanbe claims Moscow didn't inquire about pilots during preliminary probehttp://www.interfax.com/newsinf.asp?id=286523

DUSHANBE. Nov 11 (Interfax) - The Foreign Ministry of Tajikistan has expressed regret that a political content has been given to the case involving pilots of the Russian air company Rolkan Investments Ltd, the Tajik Foreign Ministry said in a statement on Friday.

The statement was circulated after talks between Tajik Foreign Minister Khamrokhon Zarifi and Russian Foreign Minister Sergei Lavrov.

"Zarifi expressed regret that political colors were added to the case involving violations of the Tajik criminal law," it says.

"On the Russian foreign minister's claims that information about the detained Russian citizens was not provided immediately, Zarifi said that during the preliminary investigation and trial neither the Russian Foreign Ministry, nor the Russian embassy turned to the Tajik Foreign Ministry either verbally or in written form," the statement says.

Zarifi also told Lavrov that all national and international legal procedures were observed when the case was being handled.

A source in the Russian Foreign Ministry earlier said that the Russian embassy in Tajikistan participated directly in settling the situation surrounding the detention of Russian pilot Sadovnichy immediately after the air company released information on the incident.

A court in southern Tajikistan sentenced Russian citizen Vladimir Sadovnichy and Estonian citizen Alexei Rudenko, pilots of the Russian airline owned by Rolkan Investments Ltd, to 8.5 years in prison each on Tuesday, having found them guilty of smuggling, illegally crossing the border, and violating international flying regulations. The court also ruled to confiscate both Antonov An-72 transport planes belonging to the airline.

The pilots insisted that they had to make an emergency landing in Tajikistan. As for the jet engine on board one of the planes, which the Tajik authorities qualified as contraband, the pilots said it served as a spare part and was not intended for sale in Tajikistan.

Sd

(Our editorial staff can be reached at eng.editors@interfax.ru)

FMS does not confirm ban on work permits for Tajik labor migrants 11/11/11 6:22AM GMT

MOSCOW. Nov 11 (Russian Military News) – The Federal Migration Service (FMS) has not confirmed reports that Russia stopped issuing work permits for…

RT News line, November 11

Russia to extradite 100 Tajiks in response to harsh sentence for Russian pilothttp://rt.com/news/line/2011-11-11/#id21883

The Russian Federal Migration Service has announced it is preparing to extradite 100 Tajik migrants, RIA Novosti new agency reports. The measure comes in response to a harsh eight-and-a-half-year sentence handed down to Russian pilot Vladimir Sadovnichy early this week by a Tajik court, the report says, citing a Russian diplomat. It is also reported that Russia’s ambassador to Tajikistan, Yury Popov, on Friday flew to Moscow to consult with the Russian Foreign Ministry over the situation. The court found Sadovnichy, who operated humanitarian flights to Afghanistan, guilty of smuggling, illegally crossing of the border of Tajikistan and violation of flight rules. The Russian authorities were outraged by the verdict and say they will continue to provide all necessary legal and diplomatic help to the pilots.

Russian military base in Tajikistan destroys expired ammunitionshttp://en.trend.az/regions/casia/tajikistan/1955656.html

11 November 2011, 11:32 (GMT+04:00)

Azerbaijan, Baku, Nov. 11 / Trend /

An operation to destroy expired ammunitions was completed in Tajikistan, Asia-Plus reported referring to Captain Dmitry Matushkin, an aide to the commander of the Russian military base in Tajikistan.

According to him, more than 72 tons of expired ammunition have been destroyed at the Lohour training ground over the past ten days.

"The most experienced servicemen have been involved in this operation," Matushkin said.

It is a routine exercise and it takes place to destroy ammunitions which cannot be used by the military personnel.

"The process of destruction of the ammunitions took place under the control of representatives from Russia's Central Military District and Military Prosecutor's Office of the Dushanbe Garrison," the aide said.

Do you have any feedback? Contact our journalist at agency@trend.az

11:11 11/11/2011ALL NEWS

Soyuz rocket with manned spacecraft installed on Gagarin’s pad

http://www.itar-tass.com/en/c154/269335.html

BAIKONUR (Kazakhstan), November 11 (Itar-Tass) — Russia’s Soyuz carrier rocket with the manned spacecraft of the same name on Friday morning was installed on the first – Gagarin’s launch pad at the Baikonur cosmodrome.

“The moving to the pad and installation of the Soyuz-FG carrier rocket with the Soyuz TMA-22 spacecraft attached to it passed nominally,” a representative of the Russian Federal Space Agency (Roskosmos) at the southern spaceport said. On Monday, November 14, the crew of the next long-term Expedition 29/30 to the International Space Station (ISS) will fly into orbit on this ship.

The gate of the operations and checkout building opened at 07:00 a.m., local time (05:00 MSK), according to the long-standing tradition. A locomotive guarded by policemen slowly transported the Soyuz-FG launch vehicle with the Soyuz TMA-22 spaceship attached to it to the launch pad. The locomotive with the rocket covered the two-kilometre way to the launch pad in about two hours.

Dozens of journalists, experts of the space industry, foreign tourists and VIP-guests were watching the moving out of the 50-metre “cigar” with the emblems of the Russian Federal Space Agency, Rocket and Space Corporation Energia and the flags of Russia and the United States at the fairing.

The Federal Space Agency specified that the rocket launch is scheduled for 08:14 MSK on November 14. In the remaining days before the launch specialists will conduct the final checks of the rocket with the Soyuz TMA-22 ship attached to it and will fuel the launch vehicle. It is the last ship of the generation of the so-called analogue Soyuzes. All the following ships will be equipped with digital technology.

On Saturday, November 12, the state commission will finally approve the crew that will fly to the ISS. Awaiting the commission’s meeting the main crew of Expedition 29/30 to the ISS – Russian cosmonauts Anton Shkaplerov, Anatoly Ivanishin and NASA astronaut Daniel Burbank, as well as backup crew Gennady Padalka, Sergei Revin and Joseph Acaba conduct the final pre-flight training, exercise and breathe the Earth’s fresh air during their daily walks.

TMA-22 will be the 111th flight of a Soyuz spacecraft, and will transport three members of the Expedition 29 crew to the ISS. The Soyuz will most likely remain docked to the ISS throughout the Expedition 29 increment to serve as an emergency escape vehicle. TMA-22 will be the final flight of a Soyuz-TMA vehicle, following its replacement by the modernised TMA-M series. The launch of Soyuz TMA-22 was originally scheduled for 30 September 2011, but was delayed until November 14 following the launch failure of the Progress M-12M resupply vehicle on 24 August 2011.

The International Space Station is a habitable, artificial satellite in low Earth orbit. The ISS follows the Salyut, Almaz, Cosmos, Skylab, and Mir space stations, as the 11th space station launched, not including the Genesis I and II prototypes. The ISS serves as a research laboratory that has a microgravity environment in which crews conduct experiments in many fields including biology, human biology, physics, astronomy and meteorology. The station has a unique environment for the testing of the spacecraft systems that will be required for missions to the Moon and Mars. The station is expected to remain in operation until at least 2020, and potentially to 2028. Russia’s next planned space station OPSEK, is to be separated prior to the ISS’ deorbiting to form a new, separate space station, intended to support deep space exploration. Like many artificial satellites, the ISS can be seen from Earth with the naked eye. The ISS is operated by Expedition crews, and has been continuously staffed since 2 November 2000.

The ISS is a joint project between the five participating space agencies, the American NASA, the Russian RKA, the Japanese JAXA, the European ESA, and the Canadian CSA. The ownership and use of the space station is established in intergovernmental treaties and agreements which divide the station into two areas and allow the Russian Federation to retain full ownership of Russian Orbital Segment (ROS)/(RS), with the US Orbital Segment (USOS) allocated between the other international partners. The station is serviced by Soyuz spacecraft, Progress spacecraft, the Automated Transfer Vehicle and

the H-II Transfer Vehicle, and has been visited by astronauts and cosmonauts from 15 different nations.

The ISS provides a platform to conduct scientific research that cannot be performed in any other way. Whilst unmanned spacecraft can provide platforms for zero gravity and exposure to space, the ISS offers a long-term environment where studies can be performed potentially for decades, combined with ready access by human researchers over periods that exceed the capabilities of manned spacecraft. Kibo is intended to accelerate Japan’s progress in science and technology, gain new knowledge and apply it to such fields as industry and medicine. The Alpha Magnetic Spectrometer (AMS), which NASA compares to the Hubble telescope, could not be accommodated on a free flying satellite platform, due in part to its power requirements and data bandwidth needs. The Station simplifies individual experiments by eliminating the need for separate rocket launches and research staff.

12:10 11/11/2011ALL NEWS

Rosavatsiya search-rescue team to ensure Soyuz ship launch safety

http://www.itar-tass.com/en/c154/269401.html

MOSCOW, November 11 (Itar-Tass) — Twenty military and civilian planes and helicopters, as well as a ship of the search and rescue service of the Russian Navy, will ensure safety of the launch to the International Space Station (ISS) of the Soyuz manned spacecraft, scheduled for November 14, Federal Air Transport Agency (Rosaviatsiya) head’s adviser Andrei Pryanishnikov told Itar-Tass on Friday.

“Along the entire ascent trajectory of the Soyuz TMA-22 spacecraft with ISS Expedition 29/30 crew the flight safety will be ensured by eight planes (three Antonov An-26, one An-24, one An-2, one An-12, Tupolev TU -142, Ilyushin IL-38) and 12 Mi-8 helicopters based at 11 airfields. In addition, the rescue vessel Mashuk of the Russian Navy has been deployed in the Sea of ··Japan (East Sea),” Pryanishnikov said. At present, “all the search and rescue forces and means have already been deployed.”

The spacecraft will fly over the territory of Kazakhstan, the southern regions of Siberia, Lake Baikal and the Far East. Rescue specialists, ready to provide medical care and evacuate astronauts from the landing site, will be permanently on duty along the entire flight path in case of activation of an emergency recovery system.

Emergency landing of astronauts even outside the territory of Russia and Kazakhstan is envisaged in case of contingency during the flight. To this end, 12 so-called “landing ranges” have been prepared in different parts of the world. Rescue specialists of the

country in which the descent capsule lands will provide first aid to the crew, in accordance with an international agreement. After that the astronauts and the capsule will be returned to Russia, the Federal Space Agency specified.

The Soyuz TMA-22 spaceship at 08:14, Moscow time on November 14 will be launched to the ISS with the Expedition 29/30 crew – Russian cosmonauts Anton Shkaplerov, Anatoly Ivanishin and NASA astronaut Daniel Burbank.

The ISS provides a location in the relative safety of Low Earth Orbit to test spacecraft systems that will be required for long-duration missions to the Moon and Mars. This provides experience in the maintenance, repair, and replacement of systems on-orbit, which will be essential in operating spacecraft farther from Earth. Mission risks are reduced, and the capabilities of interplanetary spacecraft are advanced. The ESA states that “Whereas the ISS is essential for answering questions concerning the possible impact of weightlessness, radiation and other space-specific factors, other aspects such as the effect of long-term isolation and confinement can be more appropriately addressed via ground-based simulations.”

A Mars exploration mission may be a multinational effort involving space agencies and countries outside the current ISS partnership. In 2010 ESA Director-General Jean-Jacques Dordain stated his agency was ready to propose to the other 4 partners that China, India and South Korea be invited to join the ISS partnership. NASA chief Charlie Bolden stated in Feb 2011, “Any mission to Mars is likely to be a global effort.” As of 2011, the space agencies of Europe, Russia and China carried out the ground-based preparations in the Mars500 project, which complement the ISS-based preparations for a manned mission to Mars. China launched its own space station in September 2011, and has officially initiated its programme for a modular station. However, China has indicated a willingness to cooperate further with other countries on manned exploration.

The International Space Station represents a combination of three national space station projects, NASA’s Freedom, the RSA’s Mir-2, and the European Columbus space stations. In September 1993, American Vice-President Al Gore, Jr., and Russian Prime Minister Viktor Chernomyrdin announced plans for a new space station, which eventually became the International Space Station. They also agreed, in preparation for this new project, that the United States would be involved in the Mir programme, including American Shuttles docking, in the Shuttle-Mir Program. According to the plan, the International Space Station programme would combine the proposed space stations of all participant agencies and the Japanese Kibo laboratory. The assembly of the International Space Station, a major endeavour in space architecture, began in November 1998. Russian modules launch and dock robotically, with the exception of Rassvet. All other modules were delivered by space shuttle, which required installation by ISS and shuttle crewmembers using the SSRMS and EVAs.

RT News line, November 11

Russia`s Space Agency to stop talking to astronauts before launchhttp://rt.com/news/line/2011-11-11/#id21887

Russia`s Space Agency has announced it will abandon the practice of talking to its astronauts immediately before blast-off, RIA Novosti said on Friday. “It was decided that pre-launch procedure be changed: previously after putting on spacesuits and while in the isolation room they (astronauts) talked through a glass wall with their families and the management of the space agency. Now, after putting on spacesuits, the crew will only talk to their families. The management decided to abandon the traditional ceremony of instructing astronauts in the presence of relatives and journalists,” said the source from the agency. Instead of covering these last-minute conversations, journalists will now also be dismissed from the meetings.

Chance of Russia Mars probe rescue 'very small'http://www.google.com/hostednews/afp/article/ALeqM5jQUl8mk6RjewrEtQJzvYShftVLfw?docId=CNG.c6eb696fdf9fc5e839cabbf1c0c511db.611

(AFP) – 55 minutes ago 

MOSCOW — The chances of rescuing a Russian probe that is stuck in an Earth orbit after failing to set out on its planned mission for Mars are very small, the Interfax news agency reported.

Mission control failed overnight even to obtain data from the Phobos-Grunt probe, which was launched earlier this week in what Moscow had hoped would be a triumphant return to inter-planetary exploration, it said.

"Overnight, several attempts were made to obtain telemetric information from the probe. They all ended with zero result," Interfax quoted a source in the Russian space sector as saying.

"The probability of saving the probe is very, very small," added the source, who was not identified.

Nonetheless, attempts to make contact with the probe would continue Friday, also using Earth-based facilities operated by NASA and the European Space Agency, the source added.

Russia's space agency have said scientists have a window of only a few days to reprogramme the probe in a bid to send it on its route to Mars. If this does not happen, it risks falling back to Earth.

The mission went awry after launch Wednesday when the five-billion-ruble ($165 million) probe's engine failed to fire, leaving it orbiting the Earth rather than starting its journey towards the red planet.

The probe had the unprecedented mission to land on the Martian moon Phobos and bring a sample of its rock back to Earth.

Contact with Mars moon probe still unsuccessfulhttp://en.rian.ru/russia/20111111/168596176.html

10:06 11/11/2011

MOSCOW, November 11 (RIA Novosti)

Attempts during the night to receive a signal from the unmanned lander Phobos-Grunt spacecraft, which failed to reach its orbit after separating from the launch vehicle on November 9, have so far been to no avail, a source in the space industry said on Friday.

“The spacecraft repeatedly passed over the Baikonur station and other Russian and foreign points of space communications during the night. There is no news yet,” the spokesman said.

The Phobos-Grunt probe was launched from the Baikonur Space Center in Kazakhstan on Wednesday, but its engines failed to put it on course for the Red Planet.

The mission is Russia’s first foray into deep space since losing a Mars-bound lander in 1996.

The craft, designed to bring back rock and soil samples from the Martian moon Phobos, is currently stuck in a “support orbit.”

Vladimir Popovkin, the head of Russia’s space agency Roscosmos, said on Wednesday engineers had two weeks to restart the probe's booster before its batteries ran out.

“A more thorough analysis of the orbit’s parameter and the supply of fuel onboard has shown that such commands must be delivered within two weeks,” Popovkin said, adding that the craft can stay in the orbit for up to four weeks.

The Phobos-Grunt is also carrying China’s first Mars satellite, Yinghuo-1.

10:48 11/11/2011ALL NEWS

Technical malfunctions force Boeing-757-200 to land in Yakutsk

http://www.itar-tass.com/en/c154/269311.html

MOSCOW, November 11 (Itar-Tass) —— A Boeing-757-200 jet en route from Moscow to the Far Eastern city of Magadan made a forced landing in Yakutsk early on Friday, because of technical malfunctions, a spokesman for the Russian Air Transport Agency told Itar-Tass.

“While in the air, the Boeing-757-200 airplane developed malfunctions in the system feeding air to the flight deck. The pilots decided to land in the Yakutsk airport,” the spokesman said.

No accidents were reported during the landing. No one was hurt.

The Russian Air Transport Agency has set up an ad hoc commission to probe into the accident.

Russian Press at a Glance, Friday, November 11, 2011http://en.rian.ru/papers/20111111/168594980.html

08:30 11/11/2011

A brief look at what is in the Russian papers today

POLITICS

The working group on Russia’s accession to the WTO officially approved the terms and conditions of Russia’s membership.

(Kommersant)

The former Georgian republic of South Ossetia will on Sunday hold presidential elections, the most unpredictable in the republic’s entire history.

(Kommersant)

If the ruling United Russia party fails to readjust and represent the interests of the middle class, the party could disappear, experts said.

(Vedomosti)

Germany and France are discussing a plan of a new reform for the European Union.

(Kommersant)

Russian Foreign Minister Sergei Lavrov gave an interview to Rossiiskaya Gazeta. He told the readers of the prospects of Russia-U.S. relations.

(Rossiiskaya Gazeta)

Tajik authorities probably want to exchange the convicted Russian pilot for a relative of Tajikistan’s president.

(Moskovskiye Novosti)

ECONOMY & BUSINESS

After 18 years of talks, Russia is virtually joining the WTO on its own terms: support for agriculture will not decrease, domestic gas prices will be regulated, and foreign banks will not be allowed to open branches in Russia.

(Vedomosti)

President Dmitry Medvedev may create a new state agency to regulate investment activity in the regions.

(Vedomosti)

SOCIETY

President Dmitry Medvedev is ready to toughen punishment for extremism.

(Kommersant)

Convicted Russian arms dealer Viktor Bout plans to ask Russian authorities to pass his case to an international court.

(Kommersant)

For more details on all the news in Russia today, visit our website at http://en.rian.ru.

Russia’s Red and Blacks: A Tale of Two Generationshttp://blogs.voanews.com/russia-watch/2011/11/10/russias-red-and-blacks-a-tale-of-two-generations/

November 10, 2011

This is a tale of Moscow’s two demonstrations — first the Nationalists, then the Communists , It is not just a tale of the Blacks and the Reds, but a tale of two generations.

“Russkii Sport” chanted one flying squad of nationalists. And, on signal, they threw themselves horizontal on the cold, gray asphalt, pumping out pushups.

It looked a mite comical with their winter coats, and the scarves their babushkas had probably forced on their tough guy grandsons.I thought of the Women Talk column that Svetlana Kolchik, a friend, had written two days earlier for Ria Novosti: “Where are the Men?”C’mon Svetlana, you should have taken the Marino metro line almost to the end, to Lyublino. Ok, all the guys wore black, many covered their faces with bandannas, and some snapped sinister stiff arm salutes.The nationalists were young, male, and angry.

Targeting Russia’s ruling United Russia party, one group carried a banner that showed United Russia’s bear symbol dragging a bag of loot. They chanted: “Down with the party of thieves and swindlers.”.

Targeting Muslim immigrants, one squad of 40 young men, clearly pumped for action, chanted: “Arm yourselves! Don’t tolerate them!”

One large banner read in English: “Gaddafi Is Killed, Who’s Next?”

Oh, I thought, more whining about the demise of the Kremlin’s favorite dictator. Then, the group’s chant started to sink in, ever louder: “Rossiya Bez Putina! Rossiya Bez Putina!”

They were chanting: “Russia Without Putin! Russia Without Putin!”

As a youth, I grew up next door to William Shirer, author of “Rise and Fall of the Third Reich.” When I became interested in journalism, we met and talked a few times in the 1970s – 40 years after he had covered the early years of Nazi Germany. Now 40 years after those conversations, as I stood on the cold sidewalks of Lyublino, I felt a whiff of Germany, a la 1931.

While standing near a metro exit, a large man in a black jacket accosted me. He sneered: “I suppose you would like to see Moscow all American?”

As a seasoned street-wise reporter, I read this as the awkward appeal of a lonely soul who wanted to talk. So we chatted for a while, warily.

His main assertion: 90 percent of Muscovites share nationalist anger over the massive influx of migrant workers from the Muslim south – Central Asia and Russia’s own Caucasus.

Startlingly, I found sympathy for the nationalists from two people I interviewed at random as they came out of the metro. Blinking in the sun of a holiday afternoon, they had stumbled on the public rage of the black jackets.

Three days later, the Reds had their turn.

The Communists marched down Tverskaya, Moscow’s central shopping avenue. The police seemed to be mostly concerned with picking up plastic traffic cones, restoring Moscow traffic to its rush hour paralysis. Two ambulances closely followed the parade, standing by in case a marcher had a stroke.The Communists were poor and old. They were overwhelmingly pensioners, women fumbling in their purses for the right coins to pay for a cheaply printed Communist newspaper.

Gennadi Zyuganov, the Communist leader, gave a brave speech about new blood coming into the party and new (invisible) brigades of Communist Youth.

But marchers under 40 years of age clustered together, evincing the kind of self conscious uneasiness that some people show when they visit a retirement home.

Viktor, a retired construction worker, said life was great under the USSR: “Free education, free health care, guaranteed work.” When I asked if his children were helping out, he said they had all turned out “bumzhi” – bums. A harsh verdict on a cold gray evening in the stone city (Moscow).

As the red banners passed the Zara clothing store, reportedly the most expensive street level merchant space in Moscow, I watched as sleek metrosexual salesmen cautiously peeked through their window displays. They looked out as if their luxury turf was being invaded by Martians.

The sea of red flags, the comfortable old language of 5-year plans, and the chance to meet with old comrades were the main attractions. Few people I talked to expressed the slightest hope that December’s parliamentary elections will change anything.

I asked one woman why she was buying a newspaper.

She responded: “You are a big American jerk.”

(Gee, how did she see through my disguise so quickly?)

As a seasoned street-wise reporter, I coolly sized her up.

To me, she looked like an older, shrunken version of Rosa Xhleb, the ex-KGB colonel in “From Russia with Love”. In that movie, Col. Xhleb pops a poisoned blade out of the toe of her shoe and repeatedly tries to kick James Bond.

With that vision in my head, I decided to keep moving.

As I walked away, she actually cackled: “Xa, xa, xa, XA.”

This Rosa Xhleb, 2011 edition, was clearly delighted that, there on Tverskaya, only two blocks from the Kremlin, that she had unmasked a “vrag naroda” – enemy of the people.

The march ended on Theater Square. But the Communists turned their back on the neo-classical front of the Bolshoi Theater. A few years ago, workers removed the hammer and sickle from its place of honor. They restored the double headed eagle of Czarist Russia.

Only one week before the Communist march, Theater Square was the stage for the gala reopening of the Bolshoi, capping a lavish, six year, $680 million renovation. Instead, the Communists faced the grey granite statue of Karl Marx, the largest in Russia. There, the “Lenin Generation” bathed in the warmth of the old songs and slogans of their youth.

The Kremlin evidently sizes up the Communists as yesterday’s people. Not a future threat, they get prime time and prime real estate for their march.

In contrast, the angry young men in black got police helicopters, detention trucks, and a desolate, windswept marching site that cried out: Siberia!

When the Russians go marching inhttp://themoscownews.com/russia/20111110/189194837.html

by Anna Arutiunova, RussiaProfile.org at 10/11/2011 20:53

There is a saying here that dates back to the Soviet times: “In Russia, you get punched in the face, not in your passport” (a reference to the “nationality” line that all Soviet citizens had in their passports). Essentially, this means you can get beaten not for who you are, but for what you look like. But the “nationality” issue has also been ascribed increasing importance over the past few years: according to Levada Center poll data, 48 percent of Russians want the “nationality” line to be put back in passports.

This self-identification anguish culminates in the annual so-called Russky March, the latest installment of which took place last Friday.

What more appropriate way is there to celebrate the ludicrous “Day of National Unity” holiday than with an absurdist theater performance, complete with a marching band and a masquerade? When they took to the streets, the Russian nationalists also marched straight through RuNet and the Russian blogosphere: the only place where the event could actually be announced and promoted, as well as openly ridiculed and criticized with no fear of immediate physical reprisal.

“The Russky March are aggressive f**kheads who have nothing in common with Russian national interests. As you can tell from the photos, the ‘Russian’ march has degenerated into fascism. Only the ugliest of beasts or a paid provocateur can think that fascism is compatible with the Russian people,” wrote LiveJournal user woodiewoodpeker.

“The reactions are sad to watch,” wrote LiveJournal user v_jdanov from the opposite camp. “So much noise has been made, but now all that will be covered is that a journalist was beaten and that they screamed ‘sieg heil.’ People don’t understand the point of this march.”

Others made a pass at some deeper analysis: “Have you ever thought what these ‘Russian’ marches get organized for? Someone really needs to demonstrate how scary ‘Russian’ fascism is, in order to have an excuse to ‘tighten the screws’ on the unruly people,” wrote LiveJournal user louchsveta. The same discussion takes place every year.

Indeed, the contingent that marched down the streets of Moscow’s working-class neighborhood of Lyublino was a classic sample of the typical audience of the most popular Russian social networking site, VKontakte: teenagers so high on testosterone it makes their brains incapable of processing any notion more complex than “black isn’t white.”

Occasional babushkas could also be spotted in the crowds, but that I blame on senility, which makes you forget the price you paid for a world free of fascism. The real catch was the parade commanders who stood on the sidelines – the Gray Cardinals directing the flow and the chants.

In Russia, the term “nationalism” itself may be beyond saving (just like the term “opposition”) – its meaning has been marred by its practical application. Few rational people want anything to do with what is so closely associated with xenophobia. “As positive and important as aristocratic nationalism, which imposes a certain set of responsibilities upon a person (I’m a Russian, I was born in this country, thus I should serve this country) is to me as disgusting as the nationalism of the ‘white trash,’ which claims ‘I am Russian, therefore I am great,” wrote Yulia Latynina in a column on Ej.ru.

The elitism of this attitude doesn’t escape me either. I don’t mean to say that everyone who attended the Russky March was “bydlo” (a derogatory Russian term used for members of the working class), but I have to say that I went to the Russky March expecting to be frightened. Instead, I was saddened, especially by the future prospects of these people. I didn’t hear anyone there chant “we want better education!” or anything

that would have to do with “healthy” patriotism. Thoughtless revolutions never did anyone any good. And that makes me wonder: Who is Russia really for?

The views expressed in this article are the author’s own, and not necessarily those of The Moscow News.

National Economic Trends

Russian ruble strengthens on back of European political eventshttp://en.ria.ru/business/20111111/168597211.html

11:35 11/11/2011

MOSCOW, November 11 (RIA Novosti)

The Russian ruble opened 11 kopecks higher against the U.S. dollar to 30.44 and lost just 2 kopecks to the euro to 41.49 in early MICEX trade on Friday amid changes of leadership in Europe.

The value of the bi-currency basket, comprising $0.55 and 0.45 euros, fell 5 kopecks to 35.42 rubles on Thursday's close.

Investors warmed to news that a former vice president of the European Central Bank, Lucas Papademos, is to head a new Greek interim government, and the Italian parliament's discussion of major steps to solve the country's economic problems.

The Italian parliament plans to discuss a bill on Friday, including the sale of state assets and agricultural land, the liberalization of local public service legislation, cutting state expenses and measures to stimulate economic growth.

Italy's Prime Minister Silvio Berlusconi is widely expected to resign over the weekend.

Russia's dollar-denominated RTS stock index slipped 0.29 percent to 1,525.20, while the ruble-denominated MICEX edged down 0.28 percent to 1,485.34 at 10:39 Moscow time.

Global prices for Brent crude fell 0.1 percent to $113.60 per barrel on Friday.

Ruble Advances Against Dollar for Second Day as Oil Prices Risehttp://www.bloomberg.com/news/2011-11-11/ruble-advances-against-dollar-for-second-day-as-oil-prices-rise.html

QBy Jack Jordan - Nov 11, 2011 8:11 AM GMT+0100

The ruble strengthened against the dollar for a second day as oil advanced in New York.

The Russian currency appreciated 0.2 percent to 30.49 per dollar as of 10:21 a.m. in Moscow. A close at that level would mean a weekly appreciation of less than 0.1 percent after losing the most since Sept. 25 last week. The ruble was little changed at 41.49 per euro, leaving it steady at 35.4426 against the central bank’s target dollar-euro basket.

Crude futures rose 0.3 percent to $98.05 per barrel in New York, heading for their longest run of weekly gains since April 2009 on speculation Europe’s steps to contain its debt crisis will support demand for fuel. Italy votes today on austerity measures, while Greece has formed a unity government.

Russia’s $3.5 billion of bonds due 2020 climbed, pushing the yield down three basis points, or 0.03 percentage point, to 4.38 percent. Investors pared bets the ruble would weaken further, with non-deliverable forwards showing the currency at 30.9507 per dollar in three months, compared with 30.9835 yesterday.

To contact the reporter on this story: Jack Jordan in Moscow at jjordan22@bloomberg.net

To contact the editor responsible for this story: Gavin Serkin at gserkin@bloomberg.net

Russia to handle short-term double dip, banker claims

http://www.rbcnews.com/free/20111111104320.shtml

      RBC, 11.11.2011, Moscow 10:43:20.Russia can cope with a possible double dip if it does not last for more than three or four years, former Chairman of the Central Bank of Russia (CBR) Sergey Dubinin, who currently chairs the Supervisory Council at the state-owned VTB, told RBC-TV.

      "I think the Russian economy is well prepared for a short-distance run, having accumulated a fair amount of reserves," Dubinin said, in response to the question of whether Russia could withstand a financial crisis.

      CBR has set aside enough funds to cover Russia's foreign debt, both sovereign and private, which would help the country make it through hard times, prevent banks from going bankrupt and stave off mass unemployment, he noted.

      However, "we could run out of steam if the crisis drags on," Dubinin went on to say, adding that the Russian economy is still largely dependent on oil and gas exports.

CBR's reserves declined last weekhttp://www.bne.eu/dispatch_text17738

VTB CapitalNovember 11, 2011

--- indicates slight FX selling by the CBR to support the rouble --- EUR and GDP weakening against the dollar accounted for the decline

News: The CBR’s international reserves decreased USD 4.2bn in the week ending 4 November to USD 517.8bn. YTD, they are up USD 38.4bn.

Our View: Currency revaluation explains much of the decrease in the CBR’s reserves. While gold added around USD 0.6bn, EUR and GBP weakened against the dollar, shaving approximately USD 4.7bn.

Hence, we calculate that the CBR sold a small amount of foreign currency during that week (around USD 0.5bn). Our estimates with regard to the CBR’s intervention activity correspond with the RUBBASKET performance during the reported period. On 28 October and 31 October, RUBBASKET was fluctuating in the ‘no interventions’ territory (34.70-35.70) and then moved north to the 35.70-36.00 range between 1-3 November. That implies daily target interventions (currency selling) of around USD 150mn. We also note that the CBR has started to publish the currency floating band parameters as of the end of each month.

October non-CIS imports up 20% y/yhttp://www.bne.eu/dispatch_text17738

AlfaNovember 11, 2011

According to the Federal Customs Service, non-CIS imports were up 20% y/y in October, close to the September growth rate. The data suggests that the deceleration from 41% y/y in 1H11 was sustainable, supporting our recent decision to downgrade our full-year growth estimate to 30% y/y.

We are pleased to see the import growth rate stabilizing at around 20% y/y after showing an extremely high 41% y/y growth rate in 1H11. The lack of any significant acceleration in October versus September is especially positive given that the high base effect of the 2010 spike in imports was focused mainly on 3Q and plays a lesser role toward year-end. We take it as a confirmation of our view that the recent volatility on the global market has stopped the aggressive stockbuilding process among industrial and trade companies, which supported the strong import growth rates in 1H11. Provided that import growth manages to stay within 20% y/y for all of 4Q11, our recently revised full-year import growth projection of 30% is achievable.

Business, Energy or Environmental regulations or discussions

Russian markets -- Factors to Watch on Nov 11http://in.reuters.com/article/2011/11/11/russia-factors-idINLDE7AA00620111111

Fri Nov 11, 2011 11:48am IST

MOSCOW, Nov 11 (Reuters) - Here are events and news stories that couldmove Russian markets on Friday. You can reach us on: +7 495 775 1242 STOCKS CALL (Contributions to moscow.newsroom@reuters.com): Troika: "After another hectic week, investors are more likely to see calmermarket conditions today and modest upticks at the opening... We are opening ourprices this morning up 1.0 percent." Uralsib: "Yesterday was very volatile for global markets, but by the end ofthe session most indices pared losses and managed to close confidently inpositive territory. We expect the Russian market to open with slight gains of0.2-0.5 percent as Asian markets are trading in green this morning and S&Pfutures up around 0.6 percent." EVENTS (All times GMT): MOSCOW - Russian Prime Minister Vladimir Putin hosts annual meeting with topforeign experts on Russia, known as the Valdai Club. MOSCOW - Russia's top non-state gas producer Novatek to report Q32011 financials. BAKU - Hungarian President Pal Schmitt is expected to visit Azerbaijan.

KIEV - International energy conference Petroleum Ukraine 2011. MOSCOW - The central bank to release weekly monetary base data. IN THE PAPERS : Vimpelcom will appoint Anton Kudryashov, currently the CEO ofRussian broadcaster CTC Media, as new head of its Russian businesswhile current Russian CEO Yelena Shmatova will move to Vimpelcom's globalheadquarters in Amsterdam, Vedomosti and Kommersant report. Russian oil-to-telecoms conglomerate Sistema has tapped theagricultural business, buying a farm in the southern Rostov region for nearly500 million roubles ($16 million), Vedomosti writes. Vedomosti runs an interview with Sberbank's CEO German Gref. TOP STORIES IN RUSSIA AND THE CIS : TOP NEWS: World trade takes a Russia-sized step forward Moscow says Russia, China oppose new Iran sanctions Russian court rejects lawsuit against BP execs COMPANIES/MARKETS: Russian markets rebound on strong oil, position squaring UC RUSAL Q3 net profit seen at $409 mln Novatek Q3 net profit seen down 19 pct on FX loss Sberbank posts record 10-month net profit Gazprom launches dollar Eurobond roadshow - source Gazprombank seeks 150 mln Swiss franc bond - IFR Russian retailer Magnit Oct sales rise 32 pct Rosinter sees fewer Russians dining out ECONOMY/POLITICS: Russia's commitments in WTO accession US wants quick vote on normal trade with Russia Russia blazes WTO trail for Kazakhstan and Belarus Russia eyes regional role, US ties at APEC summit Russia gold/fx reserves fall to $517.8 bln Russia Sept trade surplus up to $16.25 bln Belarus president raps govt for market reform plan NATO: Georgia polls key tests for membership ambitions Russia races to salvage stranded Mars probe ENERGY: Russia Dec oil export duty seen up to $404.5-$407.6/T

Ukraine says Russia gas talks technical - report COMMODITIES: Russia may export up to 17 mln T grain by year-end Russian harvests 96.9 mln tonnes of grain - AgMin Ukraine exports 5.4 mlnT grain so far in 11/12 -lobby Kazakhstan boosts Jan-Sept uranium output 11 pct MARKETS CLOSE/LATEST: RTS 1,534.9 +0.41 pct MSCI Russia 815.2 +1.24 pct MSCI Emerging Markets 963.1 +0.95 pct Russia 30-yr Eurobond yield: 4.320/4.263 pct EMBI+ Russia 277 basis points over Rouble/dollar 30.4850 Rouble/euro 41.4901 NYMEX crude $98.06 +$0.29 ICE Brent crude $113.57 -$0.14 For Russian bank balances see For Russian company news, double click on Treasury news Corporate debt Russian stocks Russia country guide All Russian news Scrolling stocks news Emerging markets top news Top deals European companies ($1 = 30.64 Russian Roubles)

(Moscow Newsroom)

RTS Futures Drop on Growth as Sberbank Climbs: Russia Overnighthttp://www.businessweek.com/news/2011-11-11/rts-futures-drop-on-growth-as-sberbank-climbs-russia-overnight.html

November 11, 2011, 1:10 AM EST

By Leon Lazaroff and Halia Pavliva

Nov. 11 (Bloomberg) -- Russian stock futures fell as the European Union cut its euro-region growth forecast for 2012 by more than half, worsening the export outlook for the commodity- producing country.

Futures on the dollar-denominated RTS index expiring in December dropped 0.7 percent to 151,905 yesterday as stocks in Moscow headed for a second week of declines. The Bloomberg Russia-US 14 Index of Russian companies traded in New York advanced as the American depositary receipts of OAO Sberbank, Russia’s largest lender, gained after net income more than doubled in the first 10 months of the year.

The euro-area economy may expand 1.5 percent this year and 0.5 percent in 2012, and is edging toward recession as governments are seeking ways to end the turmoil that has rattled global equity markets, the European Commission said. While a drop in U.S. jobless claims helped buoy oil on the New York Mercantile Exchange, copper, platinum and palladium fell after the commission’s assessment.

“Russian equity performance is nothing to shout about considering where oil has trended lately,” Tom Furda, director of Russian equity sales at Auerbach Grayson & Co.’s Moscow-based brokerage partner UralSib Financial Corp., said in a phone interview. “Appetite for emerging market equities is generally weak as these markets, Russia in particular, have lagged the performance of certain commodities as well as the U.S. market, for example.”

Gazprom

OAO Gazprom, the world’s biggest natural gas exporter, climbed the most in more than a week and Brent oil, the benchmark for Europe and half the world’s oil, advanced for the fifth day in six to $113.07 a barrel. Brent oil has remained above $100 a barrel for all except one day since February.

Sberbank reported that net income in the first 10 months of the year more than doubled to 276 billion rubles ($9 billion) under Russian accounting standards. The bank expects a record 1 trillion-ruble jump in its corporate loan portfolio this year, Deputy Chief Executive Officer Andrey Donskikh said yesterday in Moscow. Bad loans will total about 4.8 percent to 5 percent of the total outstanding, he said.

The bank’s net income is expected to total 300 billion rubles in 2011, above Sberbank’s original forecast of as much as 270 billion rubles, Olga Belenkaya, deputy head of the research department at Sovlink LLC, a Moscow-based investment company, said in a phone interview.

Sberbank

Sberbank jumped 4 percent in New York to $10.51 after shares traded in Moscow rose 2.5 percent on the RTS exchange yesterday, closing at $2.66. One ADR represents four ordinary shares.

“Sberbank is a very dominant bank but also a profitable bank, that doesn’t have to stretch to generate returns for shareholders,” said Lewis Kaufman, a Santa Fe, New Mexico-based money manager at Thornburg Investment Management, who oversees the Thornburg Developing World Fund and helps manage $79 billion at Thornburg. Kaufman’s fund owns shares in Sberbank, Yandex NV, the operator of Russia’s most popular Internet search engine, and O’Key Group SA, a supermarket chain.

OAO Rostelecom, Russia’s dominant fixed-line telephone operator, rose the most on the Bloomberg Russia-US 14 Index after ex-board member Evgeny Yurchenko said yesterday that he sold 6 percent of the Russian telephone company’s shares to billionaire Suleiman Kerimov.

Rostelecom

Rostelecom’s depositary receipt, each equal to six ordinary shares listed on the Micex, rose the most in five weeks, gaining 6.4 percent to close at $30.65. In Moscow, Rostelecom’s ruble- denominated shares rose yesterday the most in five weeks, gaining 5.9 percent to close at 157.56 rubles or equivalent of $5.14. Kerimov has expanded his fortune with investments in OAO Uralkali, Russia’s biggest potash producer, Polyus Gold International Ltd. and property developer PIK Group.

The Bloomberg Russia-US 14 Index in New York rose 2.2 percent to 98.49. The RTS Index in Moscow advanced 1.1 percent to 1,529.71 while the 30-stock Micex Index gained 1.3 percent to 1,489.58.

“Unless there’s a complete resolution in the euro zone, Russia will be very volatile,” Tom Mundy, chief strategist at Otkritie Capital in Moscow, said in a phone interview. “The support the market had today is a reflection of the way Russian Micex trading patterns jump from headline to headline, and that’s a huge problem.”

The Standard & Poor’s 500 Index rose 0.9 percent to 1,239.70 and the Dow Jones Industrial Average climbed 1 percent to 11,893.79.

Commodities

The Standard & Poor’s GSCI index of 24 raw materials rose 0.6 percent to 661.36 as copper fell to a two-week low on the European Union’s reduced growth forecasts. Copper futures for December delivery retreated 1.9 percent to close at $3.374 a pound on the Comex in New York, after touching $3.318, the lowest price since Oct. 24.

Platinum futures for January delivery on the New York Mercantile Exchange declined 1 percent to $1,627.30 an ounce. Palladium futures for December delivery dropped 1.1 percent to $647.80 an ounce.

Oil, Russia’s biggest export earner, rose to the highest level in more than three months after the U.S. said jobless claims unexpectedly declined. Crude climbed 2.1 percent to

settle at $97.78 a barrel on the New York Mercantile Exchange. Urals crude, Russia’s chief export blend, gained 0.6 percent to $112.43. Oil and natural gas contribute about 17 percent of Russia’s gross domestic product.

Lukoil

OAO Lukoil, Russia’s largest non-state oil producer, gained 3 percent in New York to $58.30 after shares rose 0.9 percent on the Micex to 1,783.20 rubles, or $58.19.

The Market Vectors Russia ETF, a U.S.-traded fund that holds Russian shares, advanced for the sixth time in seven trading days, adding 2.6 percent to $29.93, while the Bank of New York Mellon Russia ADR Index gained 1.1 percent to 714.11.

The Micex has lost 12 percent in 2011 and trades at 5.3 times analysts’ earnings estimates for member companies. That compares with a 17 percent slide for Brazil’s Bovespa index, which trades at 10.3 times estimated earnings, according to data compiled by Bloomberg. The Shanghai Composite Index trades at 11.6 times estimated earnings, and the BSE India Sensitive Index has a ratio of 14.9.

The RTS Volatility Index, which measures expected swings in the index futures, gained for the third day in five, rising 1.7 percent to 47.39 points.

--With assistance from Ksenia Galouchko in New York. Editors: Marie-France Han, Glenn J. Kalinoski

To contact the reporters on this story: Leon Lazaroff in New York at llazaroff@bloomberg.net Halia Pavliva in New York at hpavliva@bloomberg.net

To contact the editor responsible for this story: David Papadopoulos at papadopoulos@bloomberg.net

MICEX offers foreign brokers direct access

http://www.rbcnews.com/free/20111111112512.shtml

      RBC, 11.11.2011, Moscow 11:25:12.MICEX proposes allowing foreign brokers to directly trade on Russian stock exchanges, RBC Daily reported today, citing MICEX materials prepared for Leading Edge Investor Relation conference.

      This initiative will be discussed at a meeting of a working group on the international financial hub in Moscow.

      According to MICEX President Ruben Aganbegyan, foreign banks have requested direct access to trading on the exchange. A remote membership model exists on other

markets, and MICEX would like to discuss it with the financial market regulator and market participants, he added.

      Russian brokers polled by the daily criticized the proposal, saying that foreign brokers with their huge resources and extensive experience would squeeze out domestic brokers.

Skolkovo raises $265m from private investors

http://www.rbcnews.com/free/20111111113034.shtml

      RBC, 11.11.2011, Moscow 11:30:34.Skolkovo Foundation has raised $265m from 22 venture and direct investment funds, RBC Daily reports. The foundation has already invested $70m in a number of ventures, Chief Investment Officer of Skolkovo Foundation Alexander Lupachev said.

      Skolkov's approach to splitting investments in startups between private and public investors has proven to be successful, experts think. "By attracting private investments, Skolkovo shows that not only Russia's president, but also the market believes in the project," Vadim Kulikov from Bright Capital fund said.

Sberbank to raise $1.2 bln loan at LIBOR+1.5 pct-sourcehttp://www.reuters.com/article/2011/11/11/sberbank-loan-idUSL5E7MB1B020111111

4:06am EST

MOSCOW, Nov 11 (Reuters) - Russia's top lender Sberbank agreed with banks on a syndicated loan worth $1.2 billion under a rate of LIBOR plus 1.5 percent, a banking source told Reuters.

Two other sources said the deal is to be signed on Friday. Sberbank declined to comment.

Sources told Reuters earlier that Sberbank, which was looking to price the new deal at a margin similar to VTB's $3.13 billion loan in July, was unlikely to get such a price given weak markets.

VTB's record loan carried a margin of 130 basis points (bps) over LIBOR, at parity with Russian state development bank Vnesheconombank's (VEB) three-year, $2.45 billion deal in April.

Last month, Sberbank's departmental head Andrei Ivanov said that the rate would be "a new benchmark" for Russian banks in current environment, when European debt crisis

reduced interest to the risk and fueled borrowing costs. (Reporting by Oksana Kobzeva and Katya Golubkova)

Rusal Slides to Week-Low in Moscow on Dividend Opposition Reporthttp://www.businessweek.com/news/2011-11-11/rusal-slides-to-week-low-in-moscow-on-dividend-opposition-report.html

November 11, 2011, 3:14 AM EST

By Jason Corcoran

Nov. 11 (Bloomberg) -- United Co. Rusal’s Moscow shares fell to their lowest level in more than a week after Vedomosti reported that the management of the world’s biggest aluminum producer opposes paying nine-month dividends, citing three people familiar with the situation.

The company’s Russian depositary receipts sank 3.3 percent to 238.5 rubles by 10:56 a.m. in Moscow, their weakest intraday level since Nov. 3. A close at that level would be their lowest since the receipts started trading at the end of last year. The company’s Hong Kong-listed shares sank 2.6 percent to HK$6.04.

Billionaire Mikhail Prokhorov’s Onexim Group and Viktor Vekselberg and Leonid Blavatnik’s Sual Partners were pushing for interim dividends after Rusal refinanced $11.4 billion debt last month, paving the way for payouts to shareholders, the Moscow- based newspaper said.

“This is disappointing news,” Denis Gabrielik at Otkritie Financial Corp. in Moscow, wrote in an e-mailed report today. “Market expectations were that the company may start paying dividends,” after its refinancing, he said.

“Management has not even discussed dividend payments,” Vera Kurochkina, Rusal’s spokeswoman, said in an e-mailed statement to Bloomberg. Dividends are a question for shareholders and won’t be discussed at today’s board meeting, she said.

--Editors: Alex Nicholson, Stephen Kirkland

To contact the reporter on this story: Jason Corcoran at Jcorcoran13@bloomberg.net

To contact the editor responsible for this story: Frank Connelly at fconnelly@bloomberg.net

Rusal Management Opposes Interim Dividends, Vedomosti Reportshttp://www.bloomberg.com/news/2011-11-11/rusal-management-opposes-interim-dividends-vedomosti-reports.html

QBy Yuliya Fedorinova - Nov 11, 2011 7:01 AM GMT+0100

United Co. Rusal’s management, headed by Russian billionaire Chief Executive Officer Oleg Deripaska, opposes paying nine-month dividends, Vedomosti reported today, citing three people familiar with the situation.

Billionaire Mikhail Prokhorov’s Onexim Group and Viktor Vekselberg and Leonid Blavatnik’s Sual Partners were pushing for interim dividends after Rusal refinanced $11.4 billion debt last month, paving the way for payouts to shareholders, the Moscow- based newspaper said.

To contact the reporter on this story: Yuliya Fedorinova in Moscow at yfedorinova@bloomberg.net

To contact the editor responsible for this story: John Viljoen at jviljoen@bloomberg.net

November 11, 2011 13:09

SUEK ups coal output 8.8% in Jan-Octhttp://www.interfax.com/newsinf.asp?id=286589

KEMEROVO. Nov 11 (Interfax) - OJSC Siberian Coal Energy Company (SUEK) mined 5.985 million more tonnes of coal in January-October than it did in the same period last year, for a total of 74.334 million tonnes or an 8.8% year-on-year increase, a press release from OJSC SUEK-Kuzbass says.

SUEK-Kuzbass mined 23.301 million tonnes of coal over the ten months, which was 7.6% more, or 1.648 tonnes more, than for the same period last year.

SUEK accounts for over 30% of Russia's domestic market coal shipments and over a quarter of the country's steam coal exports.

Cf

(Our editorial staff can be reached at eng.editors@interfax.ru)

Russia's Evraz extends share exchange offerhttp://in.reuters.com/article/2011/11/11/evraz-idINWLA893920111111

12:43pm IST

MOSCOW, Nov 11 (Reuters) - Russia's Evraz said on Friday a share exchange offer in linked to its premium London listing has been extended until November 24.

The steelmaker was on Monday admitted to trading on the premium segment of the London Stock Exchange after it received over 98 percent shareholder acceptance for its proposed share swap and relocation to Britain.

(Reporting by Maria Kiselyova)

Globaltrans raises stake in BaltTransServis to 60 pct for $75 mlnhttp://en.rian.ru/business/20111111/168597349.html

11:47 11/11/2011

MOSCOW, November 11 (RIA Novosti)

Russia's largest private freight rail transportation group Globaltrans has acquired an additional 10 percent stake in BaltTransServis for $74.5 million from a minority shareholder, increasing its effective controlling interest in BTS from 50 percent to 60 percent, Globaltrans said on Friday.

“We have successfully integrated BTS into Globaltrans’ business model since we acquired an initial 50 percent stake at the end of 2009," Globaltrans chief executive Sergei Maltsev said.

BTS is a leading private freight rail transport company in Russia, operating primarily in the oil products and oil transport segment. BTS is currently operating more than 90 percent of the group's locomotives.

BTS will become the group's key platform for increasing its presence on the locomotive traction market, Globatrans said.

UTair's net profit slides in 9M

http://www.rbcnews.com/free/20111111105006.shtml

      RBC, 11.11.2011, Moscow 10:50:06.UTair saw its RAS-based net profit plunge 35.2% year-on-year to RUB 131m (approx. USD 4.2m) in January-September 2011, according to a report released by one of Russia's largest air carriers.

      Revenue came in at RUB 35.9bn (approx. USD 1.1bn), up 18.3% year-on-year, while gross profit totaled RUB 1.4bn (approx. USD 45.1m), down 11.7%.

      UTair flew over 5.5m passengers in the first nine months of 2011, up 27.8% year-on-year. Of the total, the air carrier transported 4.9m passengers by plane, up 26.6%, and 629.545 passengers by helicopter, up 38%. Passenger traffic amounted to 9bn passenger-kilometers.

Aeroflot boosts revenue in January-September

http://www.rbcnews.com/free/20111111123611.shtml

      RBC, 11.11.2011, Moscow 12:36:11.Aeroflot's RAS-based revenue came in at RUB 99.1bn (approx. USD 3.2bn) in the first nine months of 2011, up 19.8% year-on-year, Russia's largest airline said in a statement.

      The upsurge in revenue is attributable to higher demand for air transport services and rising sales, as the air carrier boosted its 9M passenger turnover 20% year-on-year, the company explained.

      Earlier, Aeroflot had reported an 8.9% decrease in net profit to RUB 10.8bn (approx. USD 349.2m) in January-September. The downturn is now explained by surging fuel prices and higher expense reserves for annual and extraordinary leaves of Aeroflot employees.

Online retailers mull association to fight shadow market

http://www.rbcnews.com/free/20111111111623.shtml

      RBC, 11.11.2011, Moscow 11:16:23.Russian online retailers are considering establishing an online e-trade association to fight shadow market practices in the online shopping industry, RBC Daily reports.

      The initiative was launched by Ivan Kurguzov, executive director of Oborot.ru, an online platform promoting e-trade, and has won the support of Russia's major mobile retailer Euroset and Utinet.ru online store.

      The association intends to focus on interaction with regulatory authorities, developing common rules for market players, expelling companies with unfair practices and promoting online trade, as well as phasing in a quality label for its members.

AvtoVAZ to build new plant in Kazakhstan

http://www.bne.eu/dispatch_text17738

RencapNovember 11, 2011

Event: It has been reported in the local press that AvtoVAZ has signed a memorandum of understanding (MoU) with the Kazakh auto assembly enterprise Asia-Avto and the state-owned corporation Ertis, on building a new full-production-cycle plant in East Kazakhstan. Investment will reach c. $0.5bn, the project plan will be developed in 2012 and construction will begin in 2013. The enterprise will have capacity of 90,000 vehicles pa by 2015, with a second stage adding 30 000 units by 2017. The facilities will be used to produce the Lada Granta, Lada 4?4 and SUV hatchback and Class B on a Renault-Nissan platform. AvtoVAZ and Ertis will each have a 25% stake in the JV, Asia-Avto will have 50%, RBC Daily reports.

Action: We see some positive for AvtoVAZ operations from the JV.

Rationale: The JV will be supported by the Kazakh government. AvtoVAZ does not plan to invest money in the project, with its share being paid for via management services, equipment etc. Licensing or intellectual property rights will not be passed on, and the project will be in the form of an assembly plant for AvtoVAZ vehicles in Kazakhstan. With the Kazakh new vehicle market fairly small (with c.30k vehicles sold pa due to the dominance of the secondary market), more important is for AvtoVAZ to get exposure to Asian markets. However, new vehicle sales could increase following Kazakhstan's entry to the Customs Union. Reportedly, vehicles from the JV will be also sold in Russia.

Inter RAO may participate in JV with Swiss Alpiq AG to build underwater electric cable to Germany

http://www.bne.eu/dispatch_text17738

AlfaNovember 11, 2011

Inter RAO has announced that it has signed a memorandum with Swiss company Alpiq AG, Kommersant reported. This agreement covers investigation into any opportunities to cooperate in the construction of an underwater electric cable (600-1000 MW capacity) from the Kaliningrad region to Germany. The power line would run parallel to gas pipeline Nord Stream. The initial plan to transit electricity to this destination was announced by Inter RAO Board Member Dangiras Mikalayunas, but this earlier proposal was not realized. However, at the moment both companies are discussing the underwater electric cable, construction of which, according to Inter RAO’s memorandum, might take from six to seven years and at an estimated price of $1bn. We believe these plans are very preliminary and, in our view, the price discussions between this JV and a foreign partner might also delay this project. Moreover, historically, there have also been negotiations on electric bridges from Russia to Japan, China and Finland, which did not lead anywhere, mostly due to pricing disagreements. Thus, overall we treat this news as NEUTRAL for Inter RAO at the moment.

Q&A: Steering the 'Gazprom of the U.S.' in Russian Waters 11 November 2011By Andrew McChesney

Read more: http://www.themoscowtimes.com/business/article/qa-steering-the-gazprom-of-the-us-in-russian-waters/447563.html#ixzz1dO1jao8I The Moscow Times

Few people would dare to reject advice from Jack Welch, the former GE chairman and CEO who is widely admired as one of the greatest business leaders of the past century.

But Ron Pollett did just that — and has no regrets.

Three years into his assignment as GE's top official in Russia, Welch advised Pollett that it was time to pack his bags and go to his next assignment.

"I said, 'Jack, I believe in this place. I think something is going to happen here. I think we can make something big here,'" Pollett said in an interview. "He said, 'Look, it's your career.' I said, 'Yup.'"

"He wasn't a firm believer, obviously, at the time. But, you know, I think I was right," Pollett said.

Pollett seems to have made a good call. Just as U.S.-based GE blossomed during Welch's tenure, the company's local operations have skyrocketed under Pollett. GE's businesses here have surged from 70 employees and annual revenues of $110 million when Pollett took over in 1998 — just as the financial crisis swept Russia — to 3,000 employees and annual revenues of more than $2 billion today.

Pollett, president and CEO of GE in Russia/CIS, wryly compares GE to Gazprom — pointing out that its operations focus primarily on infrastructure but span diverse activities. It has a school that has taught hundreds of Russian doctors how to use GE health care equipment. Its studio dubs the hit GE-owned television show "Law & Order" into Russian. Its financial services arm leases about 30 planes to Aeroflot. Oh, and the jet engines on some those planes were made by GE's aviation unit.

"The Russians see us as the Gazprom of the U.S.," Pollett said, adding with a slight, facetious smile, "and I'd say if we only had one-tenth the influence in the United States as Gazprom has in Russia, we'd be happy."

Pollett, a 41-year-old U.S. citizen, welcomed a reporter into his 12th-floor office in a gleaming tower in the Moskva-City business district to discuss how he grew GE into a major infrastructure company in Russia, how 70 percent of his business comes from the government but he never pays bribes, and how his fluency in Old Church Slavonic has translated into a love for Russia that keeps him here.

This interview has been edited for length and clarity.

Q: What is your secret to successfully managing people and business in Russia?

A: I try to hire the best people I can and then get out of the way and let them do their jobs. You've got to keep control mechanisms in place — measurements such as goals and objectives — but you really don't want people to feel that they need to come to you for every decision. In many parts of the world, and here in particular, I have noticed that many people don't want to take decisions — they want to have the general director take the decisions. I'm famous for pushing it back down and helping people build the self-confidence to take the decisions themselves. I tell them, "No matter what you do, it's not going to break the company." If you get 16 out of 20 right, then we're happy. As for the four you don't get right, we've got to make sure you don't break the company and you learn from it.

It's all about giving people the self-confidence and the ability to take decisions and become true business leaders. I've got an expression that illustrates this: "That guy's smart, but is he competent?" You know you can find smart people, but are they actually able to get the job done?

Q: How do you find the right people?

A: That's probably the biggest challenge in Russia. There are a lot of very smart people, very good technical people. But it's difficult to find leadership skills. That's why you'll find that a lot of companies bring in expat managers just to get the Western leadership traits. We find success in hiring junior-level people and then putting them through GE training. We have several veterans who have been with GE for more than 10 years and grown with the company in various roles.

We have fewer expats here today than we did when I got here and we had 70 employees, of which about 40 were expats. Today, we have about 3,000 and fewer than 40 expats. I'm a firm believer in Russian talent. In GE, we don't have glass ceilings like many companies here. It's really about instilling self-

confidence to make sure people feel they are on the same level as their European counterparts.

I also hire people who know what they're talking about. They might not have the best suit; they might not have the best tie; they might not have a Western education. But they have been here in the system and understand what they're doing and how to do it. They are able to perform.

Many companies hire people just because they look great — perhaps it's because they have an MBA on their resume. But I try to test people to see what they know. I don't scratch the surface; I go fairly deep during interviews to understand who these people are and what makes them tick. I've been known to hire people who don't speak a word of English and were rejected elsewhere. But we sensed they were smart. We hired the current CFO for one of our divisions here 10 years ago, and she didn't speak a word of English. She is now a fantastic employee and a great leader. She has grown up in the system; she speaks English better than I do.

Q: What advice would you offer a foreigner who wants to invest or expand in Russia?

A: Be patient. Things take time here. If you are in the strategic sectors such as we are in many of our businesses, you need to work very closely with the government. Try to find partnerships with the government in order to be successful long term — I think it's a bit different for consumer goods companies, which are not in strategic sectors.

Our challenge is to find ways to work with the government as well as to bring technology and localize GE's products and services together with Russian partners. If you take a look at our operations here, a good 70 percent of our sales are government. We consider Gazprom government. Aeroflot also would be government, with the largest aircraft base in Russia. Aeroflot has about 30 aircraft that we own and lease. The airline also has more than 170 planes with our engines.

Russia changes all the time, and that's the exciting part of it. You have ups and downs. My advice to investors is to be here for the long term, be patient, but also be able to ride this roller coaster. That's part of the fun being here — riding the roller coaster.

One of my favorite expressions is "never say never." I've seen a lot of things that people said would never happen in Russia, and they have happened. So never say never. Things will happen here.

Q: How do you deal with corruption?

A: Two ways. One is we are driven by compliance. We've got a very strict system. We check every customer to understand who they are, who owns the companies where their resources come from, and where they are going. We work to understand the deal structures. We actually do turn down questionable deals.

We also deal at the very top with people who are interested in attracting GE for GE, for the ability to attract other foreign investors by having somebody like GE in the country, and also for our technology and our ability to localize our production with local partners. To be honest, we don't sense corruption at the very top. Sometimes, things could happen, but we just go back to the top, tell them about it and the issue is fixed. So it's truly a top-down approach that we have here, which we are blessed with because of our size and our interest in the strategic sectors.

Q: Could you share a problem you resolved and what you learned from it?

A: Getting through the negotiations phase with major companies can be a challenge. People have different agendas, and working through their agendas can mean two steps forward and one step back. Or it can mean two steps forward, two steps sideways, and one step back. You've got to be willing to put in the time to understand each other. A lot of these negotiations involve explaining what we need, the sharing of best practices. We explain exactly what's driving our side and show the Russians that we're not trying to cheat them, that this is actually the way things are done.

A case in point is two joint ventures that we formed with Russian Technologies and Inter RAO. Negotiations took a lot longer than we expected. We signed the original documents — the MOU — in June of last year, and it took us through to September of this year to sign the actual joint ventures. People say it was a record. Well, it was probably fairly fast in terms of setting up a foreign-

Russian joint venture for the Russian market and seems slow for us, but I think it could have happened faster. But we have learned from that. We have learned that we need to get Russian-speaking talent into the business development team and the mergers and acquisition team globally so they can come here.

Q: Who or what inspires you?

A: My work. GE's corporate culture is to "perform or I'll fire you, even if you are my best friend." That's the way you need to run businesses — friendship is friendship but you need to perform; you need to have your metrics and your measurements there, and if you're not performing, you're out. Everybody is on the same level. It's a performance culture. You need to know you must pull your own weight. You're not going to be kept around because of nepotism or because of connections or anything like that. Everybody has to perform.

I don't do a lot of weekend getaways. I'm usually in the office on Saturday, to be honest. I love Saturdays because I can be by myself for most of the time. I try not to schedule

anything because I'm trying to be sensitive to peoples' family lives, but also because I can then catch up on strategies and try to better focus.

In the position that I'm in, you cannot ever take your eye off the ball. You have to keep the pressure on and never become complacent. You always have to raise the bar, not just for your team but for yourself. I think this is incredibly important — learning and pushing forward your own boundaries. I'm moving from being an entrepreneur developer to some extent to more of an operating-type leader, getting much more operational experience as we become more local. You always have to learn. If you're not learning, then you might as well give up.

Q: How has your fluency in Russian contributed to your success?

A: It's incredibly important when you sit across the table from a minister or another senior Russian official and speak their language. If you can speak the language, it means a lot to them.

If you speak the language, it helps to understand the tricks. You can get a sense of how different games are played here. You get a sense of the culture. I see a lot of expats here leading pretty big companies, and sometimes their team will run rings around them and they don't get a sense of what actually is going on. Then they're gone in two years and somebody else comes in. I think it has driven some of my team nuts because I understand what's going on. I don't need them like a typical expat manager who has to be told what life is like here, what this means and what the government wants.

I also like classic Russian poetry — Lermontov, Tyutchev. My senior thesis at Colgate was in the chronicles of Boris and Gleb, which was Old Church Slavonic. I had to translate the chronicles from Old Church Slavonic into Russian and then into English. I am actually one of the few people — among my friends — who can actually read the inscriptions in Russian Orthodox churches.

With my Russian, it was sink or swim when I arrived in Donetsk, Ukraine, in 1993 as the only foreigner in a city of more than 1 million people. In October it was minus 20 and they hadn't turned on the central heating yet, so I slept on the apartment floor in the kitchen with the gas on, trying to keep warm.

I've gone from there to where I am today. It has been an exciting journey. I love this place. I love the people. I love the culture. I'm a true believer in Russia.

Read more: http://www.themoscowtimes.com/business/article/qa-steering-the-gazprom-of-the-us-in-russian-waters/447563.html#ixzz1dO1y27Wx The Moscow Times

Activity in the Oil and Gas sector (including regulatory)

Russia to liberalize gas prices as WTO member 11/11/11 6:23AM GMT

MOSCOW. Nov 11 (Russian Business and Financial News) – Producers and distributors of natural gas in Russia will be basing their operations on…

November 11, 2011 09:24

Unified trading session for oil products may be launched in early 2012http://www.interfax.com/newsinf.asp?id=286513

MOSCOW. Nov 11 (Interfax) - The St. Petersburg International Mercantile Exchange (SPIMEX), the Interregional Oil and Gas Exchange (MBNK) and the St. Petersburg Exchange may this year sign a memorandum on a unified trading session for petroleum products, SPIMEX President Alexei Rybnikov told Interfax on Thursday.

"Talks about this with the St Petersburg and MBNK exchanges are moving full-steam ahead. There is a very strong chance that we can agree and sign the corresponding documents this year," he said.

The project will then have to be implemented technically. "I think we will be able to launch the unified trading session at the beginning of next year," Rybnikov said.

Earlier, Federal Antimonopoly Service Deputy Chairman Anatoly Golomolzin said that work to establish a unified trading session was in its conclusive phase. The session was being discussed as part of reforms for petroleum product trading on the exchange, he said.

In 2010, 7.87 million tonnes of petroleum products were traded on the exchanges, with most sold via SPIMEX (61.7%, or 4.86 million tonnes), another 2.82 million tonnes (35.8%) was sold on MBNK and 194,300 tonnes (2.5%) via the St. Petersburg exchange. Sales on the SPIMEX alone have topped 10 million tonnes so far in 2011.

me

11.11.2011

Russia will present a package of tax breaks for Arctic before the year endhttp://www.oilandgaseurasia.com/news/p/0/news/13538

Russia will before the end of the year present a comprehensive package of tax breaks and other benefits for the companies operating on the Arctic shelf.According to the plan, which is expected to be approved by government before year’s end, the Arctic project operators will be offered a set of benefits which is to facilitate their investments in the complex region.

A copy of the plan has been obtained by newspaper RBK Daily.

Several ministries, as well as the companies Gazprom, Rosneft and Lukoil are reported to be involved in the process with the plan, the newspaper writes.

The list of measures not only includes the introduction of a zero-tax on oil, LNG and condensate export and on import of equipment and technology, but also significant other tax benefits. Among these will be an adjusted production tax, as well as tax on exploration. The companies will not have to pay property tax. In addition, a zero-VAT rule will be introduced both on export operations and on goods and services. Also the system of royalties is likely to be changed, and harmonized with international standards.

The new regulations come after the companies with shelf licenses have pushed hard for enhanced benefits. Current regulations applying to land operations will not make the far more complex and expensive shelf operations profitable, the companies argue.

Copyright 2011 Barents Observer All rights reserved

Russian court rejects lawsuit against BP execshttp://in.reuters.com/article/2011/11/11/us-tnkbp-court-idINTRE7AA0PO20111111

11:09am IST

MOSCOW (Reuters) - A Siberian court has rejected a $2.8 billion lawsuit filed by minority shareholders in Russia's No.3 oil firm TNK-BP against board members nominated by the firm's British shareholder BP, a BP lawyer said on Friday.

The minorities' suit was heard amid a bitter legal dispute between the British oil major and its local partners in TNK-BP, a 50-50 joint venture, over BP's failed attempt to form a strategic alliance with state-controlled Rosneft.

"The claim was initially absurd and legally groundless," BP lawyer Konstantin Lukoyanov said in a statement.

The judge hearing the case had earlier ruled that the plaintiffs owned less than 1 percent of TNK-BP's shares -- the necessary threshold according to the Russian law.

The main plaintiff, Andrey Prokhorov, was seeking damages from two BP nominees on the board of TNK-BP Holding, claiming the company suffered damages by being excluded from the BP-Rosneft deal struck last January.

The judge was also expected to rule on a related claim seeking $13 billion in damages from two BP entities. Lukoyanov said in the statement that, in his opinion, this claim "must also be rejected."

BP and Rosneft had agreed to team up to explore for oil in Russia's Arctic offshore and swap shares, but AAR launched a successful legal action to block the deal, saying it violated an exclusivity clause in TNK-BP's shareholder agreement.

Arbitration over the case continues, and is seeking to establish whether BP may be liable for what could be billions of dollars in damages.

(Reporting by Melissa Akin, Editing by Douglas Busvine)

LUKoil to invest over $16 bln in North Caspian deposits

http://www.bne.eu/dispatch_text17738

RIA NovostiNovember 11, 2011

Russia's largest private oil company LUKoil will invest over 500 billion rubles ($16 billion) in the development of oil deposits in the northern part of the Caspian Sea, Prime Minister Vladimir Putin said on Wednesday.

"LUKoil continues implementing a large-scale program of the comprehensive development of the Northern Caspian Sea deposits. LUKoil will spend a very large sum and investment, considering expenditures on the coastal infrastructure, will exceed 500 billion rubles," Putin said.

The implementation of the project to develop North Caspian Sea deposits will strengthen Russia's energy potential, create new jobs and boost production in the shipbuilding industry, he said.

Earlier on Wednesday the company signed three agreements with contractors to build infrastructure at the Filanovsky oil and gas field in the Northern Caspian Sea. LUKoil expects production at the field, scheduled to be launched in 2015, to amount to 6 million tons of oil and 800 million cubic meters of natural gas per year.

13:02Timchenko consolidates 93% of Transoil (Part 2)

http://www.interfax.com/news.asp

'Russian response to Trans-Caspian pipeline construction would follow quickly' http://www.news.az/articles/politics/48476

Fri 11 November 2011 05:57 GMT | 6:57 Local Time

News.Az interviews Konstantin Simonov, Director General of the National Energy Security Fund (Russia).

What impact will the launch of the Nord Stream have on energy market? Will it toughen the competition among other projects in the Caspian region or, on the contrary, will ease it?

Nord Stream has nothing to do with the "southern theme." After all, this is “northern access”. But when it comes to the Caspian region, the local gas is meant for the south of Europe. Although the EU promises to integrate all countries into a single gas network, this has not happened yet.

Of course, now any gas issue is perceived in terms of the competition that you mentioned. Azerbaijan does not need to worry in this regard because its 16 billion cubic meters of gas from the Shah Deniz will sell very easily. Another thing is that this gas will not save the European Union, because the demand for gas will still grow at a faster pace. But Nord Stream, is, of course, an extra request and extra proposal by Russia and it will increase gas supplies to European markets.

In fact, the problem of alternative suppliers is that the EU, obsessed with the idea of diversification, takes any other gas, except that of Russia, with great pleasure. Another thing is that this gas is not in volumes needed by Europe. Therefore, building the Nord Stream, Russia offers the EU, "Guys, we have invested together with your companies, built the pipeline and we are ready to increase gas supplies to European markets."

Nevertheless, one should bear in mind that the Nord Stream will partly function as a replacement for Ukrainian route for the time being. That is, we should not think that this

is an additional volume of gas which will come into the European market. This is part of the gas which will be pumped from the Ukrainian direction.

This raises a question about the South Stream in this regard. Let me explain why. We have built the Nord Stream. This is a message to Ukraine to finally agree on the fate of the gas transportation system. Ukraine does not want to negotiate. So, Ukraine’s reluctance to solve the problem prompts Russia to be active in the south of Europe, too. Despite intensive talks about competition, there is no real competition at all.

And what competition can be here? In the south there is a proposal only from Azerbaijan. But there are already a number of requests for Azerbaijani gas. Will it create competition? No, it will not. It is planned to export 6 billion cubic meters of gas to Turkey and 10 billion cubic meters to Europe. This volume is not enough to create competition. There is no any other gas yet.

So, the competition in the south is still of political nature. It is unclear yet with whom Russia will compete in the gas market.

Meanwhile, the EU is actively lobbying the construction of a gas pipeline in the Caspian seabed despite objections from Russia and Iran. Let me remind that the first round of talks on this project involving experts from the EU, Azerbaijan and Turkmenistan took place in Brussels in October. What are the chances to implement Trans-Caspian Gas Pipeline?

In fact, the situation is very simple. Russia’s viewpoint is based on international law. It is known that there were only two countries in the Caspian Sea at the time - the Soviet Union and Iran. They signed all the agreements over the reservoir. It is known that these agreements have identified the 10-mile zone within which the coastal states are engaged with production in the Caspian Sea.

These documents clearly state that all the issues associated with such complex infrastructure projects should be resolved through consent of only these two littoral states.

Naturally, all these rules transformed into current arrangements over the reservoir when the USSR collapsed and four states at once appeared in its place in the Caspian Sea. The idea is simple - the problems of the Caspian Sea should be resolved through consensus of all five littoral states, and only and only by them. We do not have Brussels, Washington and Beijing in the Caspian region. They should not be there at all.

I always read the European press, where lawyers argue that it is legal to build Trans-Caspian gas pipeline without Russia’s consent. By and large, it is possible to organize conferences to focus on this topic. But we must understand one thing: it will not change Russia’s position on the Trans-Caspian pipeline.

Russia will always be against the construction of this pipeline. And it has legal grounds to

do this. This prompts a question to Turkmenistan: Is Turkmenistan ready to ignore Russian Federation, ignore its opinion?

It will be impossible to persuade Russia through conferences, Barroso’s visits to Baku and Ashgabat. Will Ashgabat dare to openly declare it to Moscow?: "We don’t care about any of the international agreements and your approach to the status of the Caspian Sea. We will build this pipe just because Brussels and Washington support us."

Naturally, this prompts a question: how Moscow will react to all these? Many people call me a hawk, but I do not deny that this is a matter of prestige of the state – whether Russia is ready to tolerate such an outright move of disrespect. If Russia’s allows to treat itself in a way Tajikistan did a couple of days ago trying the crew of the Russian aircraft, the Trans-Caspian gas pipeline will become possible.

But what we see today is that Turkmenistan, despite the support from Washington and Brussels, is not ready to risk yet. I am very doubtful that Russia will tolerate it. Moreover, the reaction can be very hard up to some sort of military conflict in the Caspian Sea.

Is Turkmenistan ready for this? I have great doubts in this regard. And I can see how European and American officials, experts now try to persuade Turkmenistan to begin to construct it.

I also see determination of Turkmenistan to do it in words. I can see that it does not start this. So, Ashgabat understands that the situation will be the same as it was in Georgia in August 2008. Back then they promised to protect Georgia and some kinds of guarantees. And how it ended? No one protected it and when Russia responded, Washington abandoned Saakashvili, and things could almost end up in a capture of Tbilisi. Thank God, Russia did not do it.

Does Turkmenistan want the same happen in the Caspian? If so, then let's begin to build Trans-Caspian pipeline and wait for the military response by Russia. I think it will follow very quickly.

Caspian countries have a number of initiatives to foster regional cooperation in the field of energy and economy. Is it possible to realize them without intervention of non-regional players?

Today we see that the situation in the Caspian Sea is very complicated. We understand that the states here have quite different interests which hinders to implement common initiatives, work of some joint institutions which worked really, but were not only discussed at talks, conferences and so on.

The reason is clear. It is correct view that the Caspian problem must concern only the five littoral states. But today we understand that Washington cooperates with Azerbaijan and Turkmenistan quite actively. Brussels is also active in this regard.

There is Kazakhstan, which has a more complicated position. It claims to be one of the most important players in the Caspian Sea and Central Asia, in general. But Kazakhstan understands that it has no enough power and so it is not going to quarrel with Russia. But on the other hand, he also acts very carefully based on its interests.

Finally, there is Iran. We witness increasing political tension around Iran. It is enough to look at the latest nuclear dossier of IAEA. Israeli Premier claims that his country is ready to launch military action against Iran. Of course, the war in Iran will have an inevitable impact on Caspian region although facilities in the Caspian Sea will not face a direct attack.

Look at the relationship between Iran and Saudi Arabia. These countries are actually on the brink of war! Will this impact Caspian region? Of course, if Iranians start a war with Saudis, will they later participate in some kind of joint Trans-Caspian projects?.

Therefore, the situation is very complicated. It is hard to bring the countries around the single table of talks. We know that meetings are held annually, but they do not lead us to common denominators.

Today there are no some actually working institutions that could bring together the five Caspian littoral states. I hope that there will be one. But what I see today is that the coastal states have own interests and are difficult to bring together.

We even see that they reach the point of an open conflict. Today Russia and Turkmenistan have very difficult relationship. There is also an uneasy relationship between Russia and Iran plus additional pressure from an external factor. While talking about Washington and Brussels, we forget that soon Beijing will certainly begin to deal with solution to the Caspian problems.

Moreover, it is already present in the Caspian through Kazakhstan and Turkmenistan, where China’s influence is growing at a fantastic pace. This is another great power.

That is, the tangle of problems in the Caspian Sea is becoming more complicated and dramatic. I think all this will not lead to good results.

F.H.News.Az

Russia to retain dominance on the gas markethttp://rt.com/politics/press/nezavisimaya/russia-gas-oil-energy/en/

Published: 11 November, 2011, 06:57Edited: 11 November, 2011, 07:03

Daria Tsilyurik

Experts predict the end of the era of cheap oil

Over the coming decades, Russia will remain “the cornerstone of the world’s energy system”. This conclusion is contained in the International Energy Agency’s (IEA) annual report. Experts predict oil prices to rise to $150 a barrel in the near future, while the US will lose the title of the largest oil importer first to the European Union, and then China.  

The European Union will surpass US oil consumption by 2015, eventually yielding its leadership to China in 2020. This information is contained in the World Energy Outlook 2011, prepared by the IEA – and autonomous international body within the Organization for Economic Cooperation and Development (OECD). Over the coming years, oil imports to the US are expected to decline substantially due to the new energy efficiency standards for cars and trucks, as well as a rise of domestic oil and natural gas production.   

“The growing demand in the transport sector and rising spending on exploration of oil and gas deposits and extraction of raw materials confirm the end of the era of cheap oil,” argue authors of the report. They predict a barrel of crude oil will cost $120 in 2035. Moreover, investments for exploration of oil and gas deposits and extraction of raw materials in the Middle East and North Africa will decline by a third, driving the price of oil to $150 a barrel by 2015.  

Analysts explain the temporary decrease in market tensions by the slowdown in economic growth and the expected return of Libyan oil. At the same time, long-term trends are determined by the high demand for energy resources in China and India, as well as Indonesia, Brazil, and countries of the Middle East. In 2035, China’s energy consumption will surpass that of the United States by nearly 70%. Meanwhile, “the rise in oil demand is taking place in the transport sector of countries with rapidly developing economies”.

In the report, it is noted that the highest rise in oil production will take place in Iraq, Saudi Arabia, Brazil, Kazakhstan, and Canada. The Middle East and North Africa will account for more than 90% of the global rise in oil production. 

Turning to the situation with natural gas, the IEA indicates that “Russia will remain a major gas producer in 2035 and become the largest contributor to the total gas supply growth; it will be followed by China, Qatar, the US, and Australia”. While predicting a “golden gas era”, the document provides a fairly optimistic assessment of “coal prospects” in the global energy demand as well. Today, almost half of the global coal production is consumed by China, which will be replaced as the largest coal importer by India in the 2020s, making the US the world’s second largest coal consumer.  

Russia’s place in the IEA’s World Outlook is far from last: experts are calling it “the cornerstone of the world’s energy system”. At the same time, the aforementioned factors such as high demand and favorable energy resource prices, according to analysts, do not guarantee cloudless prospects for Russia, as the main oil and gas reserves in western Siberia are depleting and the future only has more-expensive reserves in store.        

International experts are not only talking about the inevitability of the changing geography of production and development of eastern Siberia and the Arctic, they are also suggesting Moscow increases the energy efficiency in each of its economic sectors within the framework of economic modernization. They say that if this indicator is matched to the level of the OECD countries, then Russia could decrease its annual primary energy consumption by almost a third – or equivalent to the energy volume, annually consumed by the United Kingdom. 

The IEA suggests that, in 2035, Russia will produce 9.7 million barrels of oil per day, with gas production rising by 35%. Meanwhile, the bulk of Russia’s energy exports will continue to head to the European markets, though the share of the Asian markets will rise. In 2035, China’s share in Russia’s total revenues from fossil fuel exports will rise from its 2010 level of 2% to 20%, while the European share will drop from 61% to 48%.   

According to the head of the Center of Energy Security Problems at the Institute for the USA and Canadian Studies, Andrey Korneyev, assertion that the share of the European states in Russia’s energy exports will be reduced is questionable. “Russia’s energy strategy does not foresee any sudden changes in the export structure. It assumes a fairly equal distribution of export supplies,” said Nezavisimaya Gazeta’s (NG) interlocutor. 

“With the rise and development of infrastructure, Russia’s supplies to China and other Asian states will rise,” added the expert. “But not on such high scale and not at the expense of exports to Europe. All of Russia’s long term infrastructure investments such as Nord Stream and South Stream, which are aimed at Europe, are expected to ensure a balance. Otherwise, these enormous funds would not have been allocated for the construction of pipelines.”  

Korneyev added that the Organization of the Petroleum Exporting Countries (OPEC) had also published its report on Tuesday. According to the organization, by 2015, daily oil demand is expected to rise from 86.8 to 92.9 million barrels. Moreover, for 2035, OPEC forecasts $133 per barrel (compared to the IEA’s $120). According to the IEA, daily oil demand will increase from 87 million to 99 million barrels of oil in 2035, and based on the OPEC data – to 110 million barrels. According to the expert, these discrepancies are quite significant.   

“All foreign projections are taken into account by our analysts and are reviewed by the Energy Ministry in detail,” he concluded. “In any event, Russia reserves the right to determine its sovereign energy policy based on its own long-term interests. This is the way our relations are being built with OPEC, for example, where Russia serves as an

observer, considering the forecasts and recommendations that are issued by the Organization’s experts.”

Gazprom

Gazprom mandates BNPP and JPM for bond http://www.euroweek.com/Article/2933031/Channel/2007/Gazprom-mandates-BNPP-and-JPM-for-bond.html

Issue: 1230 - 11 November 2011

Gazprom has mandated BNP Paribas and JP Morgan to arrange a 144a bond issue in dollars. The roadshow will take place on Monday and Tuesday. ..

Gazprombank raises 350 mln in Swiss franc bondhttp://af.reuters.com/article/commoditiesNews/idAFL5E7MB0MO20111111

Fri Nov 11, 2011 8:11am GMT

MOSCOW Nov 11 (Reuters) - Russia's Gazprombank raised 350 million Swiss francs ($386 million) via two-year Eurobond issue, Troika Dialog said in a report on Friday.

Two banking sources confirmed the report to Reuters.

Gazprombank, a banking unit of gas monopoly Gazprom , initially sought to raise at least 150 million Swiss francs. The bank managed to price the deal at a yield of 4.375 percent, as earlier planned.

Gazprombank in August secured a $1.2 billion three-year syndicated loan at a rate of LIBOR plus 1.5 percentage points. The bank's 2011 borrowing plan calls for up to $2 billion in loans from external markets. ($1=0.907 Swiss Francs) (Reporting by Katya Golubkova and Elena Orekhova)

Turning Gas Downhttp://russiaprofile.org/business/48937.html

New Market Realities May Compel Gazprom to Lower Export Gas Prices to Meet Sales Forecast

By Tai Adelaja Russia Profile 11/10/2011

After nine months of crunching heady growth numbers, Russia's gas monopoly Gazprom lowered its short-term sales forecast on Wednesday. Amid the dizzying rise in energy prices this summer, the state-owned gas giant said it could sell a whopping 158 billion cubic meters of gas this year. But with Europe seething with economic crisis and Libya set to resume gas exports, analysts say it’s time for Gazprom to revise down its forecast for gas exports as well.

"We expect that this year's exports will amount to 151 to 152 billion cubic meters," Sergei Chelpanov, the deputy head of Gazprom's export unit, was quoted by PRIME news as saying. "We hope that the start of the cold season in Europe will spur further demand." Chelpanov’s modest expectations contrast sharply with the mood at the state-controlled energy giant in May, when Gazprom Chief Executive Alexei Miller was bullish about the European natural gas market, saying that demand was "skyrocketing."

Miller announced then that gas deliveries by the gas monopoly to European customers in April increased 20.5 percent over the same period last year, adding that volumes are expected to remain steadily high. "Gazprom's gas export volumes this May are virtually matching its winter volumes," Miller was quoted as saying by RIA Novosti. "The request for today's supplies is almost 500 million cubic meters. The volumes of gas supplies are increasing along with the demand for gas in Europe."

The Gazprom CEO was more than jubilant as he unveiled expected gas prices, to which Russia’s long-term gas supply contracts to European nations are tied. "This April, for instance, we are going to export more gas than in some of the winter months, and by December gas is expected to cost around $500 under our long-term contracts," Miller said in a statement posted on the Gazprom Web site. "I believe these are not the last record figures for this year."

But the higher-than-average gas prices may be the reason why European consumers will buy less gas in future, analysts say. “The price that Gazprom charges for gas are a tad more expensive than spot prices for gas, because they are tied to the price of oil,” said Maxim Moshkov, an analyst at UBS in Moscow. "Our recommendation for Gazprom has always been that it must be more flexible in its pricing policy. And unless Gazprom understands this, it will face a decline in its revenues, which are mainly derived from gas exports.”

Despite such warnings, Gazprom, which supplies 25 percent of Europe's gas, remains upbeat. Gazprom Deputy Chief Executive Alexander Medvedev assured journalists this week that the world's largest natural gas producer hopes to report record export earnings this year. He predicted that the company could rake in up to $72 billion this year in revenues from gas exports to CIS and European countries, the RBC Daily reported on Thursday. Exports to Europe, Medvedev said, could fetch the company $60 billion against $53 to $55 billion earlier forecasted.

The gas giant on Tuesday launched the first leg of the 760-mile Nord Stream pipeline, designed to move up to 55 billion cubic meters of natural gas to Western Europe and boost revenues. Gazprom said it exported almost 73 billion cubic meters of gas in the first quarter, 44.4 billion cubic meters of which went to consumers in Europe. However, the company conceded that second quarter sales figures – 54 billion cubic meters – were not so upbeat. While the company has yet to reveal figures for the third quarter, Chelpanov noted that the company "experienced a significant growth in gas exports to Europe." "We hope to export close to 154 billion cubic meters of gas next year, although the number of contracts is much greater," Chelpanov said. "Next year, we hope there will be ten to 12 billion cubic meters additional demand."

Analysts said the figures are over-optimistic. “Gazprom's predictions for gas exports next year are far too rosy," said Valery Nesterov, an oil and gas analyst at Troika Dialog. "It is telling that Gazprom never had realistic projections for gas exports. They are usually way too high and are almost always revised downward." This summer's growth in gas exports has been spurred by the interruption of gas supplies from Libya because of civil war in that country, Nesterov said. “It will be a long shot to count on the same market situation next year, he said.

Other analysts, including Alexei Kokin, a senior oil and gas analyst at UralSib Financial Corporation, said European consumers have been stockpiling on gas this summer to forestall paying higher prices, should cold weather increase demand for heating. "The high demand for gas this summer reflects the fact the European consumers are trying to err on the side of caution,” Kokin said. “They [European nations] simply wanted to fill up their gas reservoirs with relatively inexpensive blue fuel."