Russia 101112

Basic Political Developments MAJOR EVENTS LATER THIS MONTH

o Nov 13: Working day, falling on Saturday o Nov 13: Prime Minister Vladimir Putin to visit Bulgaria o Nov 13–14: President Dmitry Medvedev to attend Asia–Pacific Economic

Cooperation forum summit in Japan o Nov 14: President Dmitry Medvedev to meet with US President Barack

Obama on sidelines of Asia–Pacific Economic Cooperation summit in Japan

o Nov 16–19: Slovenian President Danilo Turk to make official visit to Russia

o Nov 17: President Dmitry Medvedev to hold talks with Slovenian President Danilo Turk

o Nov 19–20: President Dmitry Medvedev to take part in Russia–NATO summit in Lisbon

o Dec 1–2: President Dmitry Medvedev to take part in OSCE summit in Astana

o Dec 3: President Dmitry Medvedev to meet Italian Prime Minister Silvio Berlusconi in Sochi

o Dec 7: Russia–EU summit in Brussels Lavrov hopes new US Congress will give up short-term considerations - “I hope

that in the Congress not short-term considerations in an attempt to outplay other political party, but realization of the United States’ deep interests will prevail,” he said in a reply to journalists’ question how the change in the balance of forces in the U.S. Congress will affect Russia-U.S. relations.

Medvedev aware of U.S.-Russian spy scandal (Part 2)o RF should draw proper lessons from RF espionage case in US

Russia ready to work with U.S. on missile shield - According to Lavrov, if NATO indicated that it was open for mutually beneficial cooperation, Russian President Dmitry Medvedev would explain Moscow's position at the upcoming NATO summit in Lisbon. As the minister noted, even if the joint project is carried out, it will not be directed against any country.

o Russia, NATO unlikely to create joint missile defense system – Lavrovo URGENT: Russia ready to cooperate with NATO on missile defense in

interests of all - Lavrovo Moscow believes Russia-NATO summit to end 'post-Cold War' period -

Lavrov  Moscow welcomes London's intentions to improve bilateral relations - "Ice [in

Russian-British ties] is a relative concept. We have never frozen Russian-British ties since it is one of the most important issues in Russian policy. Russian and British business cooperation shows that life makes us develop good relations instead of obstacles," Lavrov said.

Rushing in - Putin will visit Bulgaria on November 13 and will meet his counterpart Boiko Borissov, with analysts predicting that the Russian prime minister will secure major advances on the two bigger projects, with little or no discussion expected on the Bourgas-Alexandroupolis pipeline, where Bulgaria is unhappy with the environmental issues raised by the project. But the other two are both of key importance for Moscow: Belene is slated to become the first Russian nuclear plant built in the European Union, which Russia hopes will open future opportunities on a continent where nuclear power is seeing renewed interest, while South Stream is meant to prevent a possible decline of Russia's importance as a key natural gas source for the bloc, as well as give Moscow further leverage in case of future gas transit disputes with Ukraine.

Czech Relations Improving - Russia and the Czech Republic stand “an excellent chance” of bringing the volume of their economic relations, which has shrunk heavily after the global financial crisis, to its pre-crisis level by the end of 2010, Prime Minister Vladimir Putin said Thursday… Klaus also expressed hope that economic relations would improve and said he planned a meeting with Russian business figures for Friday.

o Prime Minister Vladimir Putin meets with Czech President Vaclav Klaus - During the conversation, Vladimir Putin expressed satisfaction with how both countries have handled the decline in trade and economic relations in 2009. He also highlighted “the good prospects in the energy sector, industry, the financial sector, and transport.” Vaclav Klaus, for his part, stressed that expanding economic and other relations “is in the best interests of both countries.”

Greens attack Australia's move to sell uranium to Russia - Environmentalists on Friday attacked Australia's decision to sell uranium to Russia, voicing concerns over safety standards and a lack of inspections.

Delayed RF-Japan doc signing not linked with Medvedev visit - The delayed signing of a Russian-Japanese economic protocol planned on Friday is not linked with Russian President Dmitry Medvedev’s visit to the South Kuriles, Chief Cabinet Secretary Yoshito Sengoku told a news conference here on Friday.

o Japan refuses to sign economic protocol with Russia - Japan refused to sign a protocol on economic cooperation with Russia on Friday in protest against Russian President Dmitry Medvedev’s visit to the South Kuriles, Japanese Minister of Economy, Trade and Industry Akihiro Ohata said at a meeting of a committee of the lower house of parliament in Tokyo on Friday.

o Japan firms get Russian order for power-heat cogeneration systems - Kawasaki Heavy and Sojitz will sign an agreement Friday to supply the systems between 2011 and 2014 with the Vladivostok-based Far Eastern Center for Strategic Research on Fuel and Energy Complex Development, the two said.

o Gas Deal With Japan May Stall - Viktor Timoshilov, head of Gazprom’s Eastern projects division, will still meet with trade ministry officials Friday, said Hirohide Hirai, director of the petroleum and natural gas division at the trade ministry.

Russia, Japan leaders to meet amid islands spat - "The timing (of the talks with Japanese Prime Minister Naoto Kan) is still being agreed. They will discuss the Russian-Japanese relationship," Medvedev spokeswoman Natalya Timakova told reporters.

o Medvedev to meet with Japanese leader during APEC summit o Medvedev and Kan to Hold Japan-Russia Talks at APEC (Update1) o Russian, Japanese leaders to meet amid island row

No kimonos for world leaders during APEC summit - Informal national attire during APEC summits was first introduced in Seattle in 1993. The leaders were then given leather jackets to wear. Since then the leaders of the Asian-Pacific countries have worn the host nation's clothes to pose for photo shoots.

G20 Summit Seoul o URGENT: G20 summit to seriously lessen currency war threat -

Medvedevo Russia to seek adoption of convention on oil spill prevention at next G20

summit - Medvedevo BRIC countries approve of including S.Africa in group - Medvedev o G20 against U.S. idea of current account limits - Kremlin aide o G20 to agree to avoid 'artificial devaluations': Russiao Russia won't invest in troubled economies says Kremlin aide o Russia's investment policy to be guided by global economy o Russia content with denunciation of currency warso G20 to draft road map toward macroeconomic policy benchmarks-Kudrino S.Korea proposes global financial security network at G20 summit o Medvedev holds talks with German chancellor, Turkish PMo Medvedev attends G20 plenary meeting in Seoulo Medvedev holds working meetings on G-20 fringeso British investors show interest in Russia's hi-tech hub - British companies

are interested in participating in Russia's hi-tech hub, Skolkovo, a source in the Russian delegation at the G20 summit said on Friday.

Medvedev to visit India in December for RF-India summit – Sergei Ivanov: Russian President Dmitry Medvedev will visit India in December to attend the Russia-India summit, Vice Prime Minister Sergei Ivanov said.

Russian plane crashes in West Darfur - A Russian plane crashed while trying to land Thursday in West Darfur killing at least two people and injuring 17 others, Sudanese civil aviation said.

Somali pirates seize freighter with Russian national Latvia’s speculations over Russian border issues provocative – FM: The Russian

Foreign Ministry has described as provocative attempts by the Foreign Ministry of Latvia to speculate on the theme of the border with Russia, Russian Foreign Ministry deputy spokesman Alexei Sazonov told the media on Thursday.

Armenia is grateful to its Russian friends – Sargsyan: Stable Armenian-Russian strategic partnership is developing and inter-parliamentary cooperation plays key role in strengthening of bilateral ties, Armenian President Serzh Sargsyan said

during meeting with delegates of Armenian-Russian inter-parliamentary cooperation committee.

Moscow backs Azerbaijani elections - "First of all, we would like to note the greater activity of citizens at polling stations, compared to the 2005 elections, the good level of organization of the elections, the professional work of the Azerbaijani Central Election Commission," Sazonov said, according to the Russian Foreign Ministry website.

Interior Minister: 'More Russian Spy Networks Operate in Georgia'o Wife and Son of Detained ‘Spy’ Lash Out at Tbilisi - The relatives of a

retired Russian police officer arrested on spying charges in Georgia accused Tbilisi authorities on Thursday of denying him a fair trial.

Pretrial hearings on Russian pilot’s case begin in NY - Pretrial hearings on the case of a Russian pilot Konstantin Yaroshenko, who has been facing drug trafficking charges in the U.S., are due to begin in New York today.

Dagestan's president performs Hajj - In October 2010, Magomedov received an invitation to the complete the Hajj as an honorary guest of the Saudi king.

Russian opposition to hold unsanctioned rally in downtown Moscow - Activists of a Russian opposition movement will gather in downtown Moscow on Friday for a "Day of Wrath" rally against recent attacks on a journalists and an environmental activist.

Russian protest over media attacks - Rally organiser Anatoly Globa-Mikhailenko said: “It’s very good that the investigation is now under the special control [of Russian President Dimitry Medvedev] and that the president is not indifferent to what is going on in our country. But how can it help? This is the question.”

Chief auditor in Primorsky Ter detained when taking bribe Train with coal derails on Transsib, none hurt Almost 40% of Russians drink to excess — expert Sections of 2 ring roads in Moscow to be over before yearend Russian Press at a Glance, Friday, November 12, 2010

o President Dmitry Medvedev will hold an online question-and-answer session with the public on November 16 in what analysts called a show of his commitment to modernization and his wish to run for president in 2012, the Moscow Times said. Meanwhile, Nezavisimaya Gazeta says the president’s address to Russia’s bicameral legislature, the Federal Assembly, tentatively planned for November 17, may be delayed until November 22(The Moscow Times, Nezavisimaya Gazeta)

o Only three parties - pro-Kremlin United Russia and A Just Russia parties, as well as the Communists - would manage to clear the seven-percent threshold in the December 2011 parliamentary elections, according to the All-Russia Center for the Study of Public Opinion (VTsIOM)(Komersant, Vedomosti)

o This year’s presidential elections in Belarus may set the country’s record for the number of candidates. At least ten potential candidates managed to gather 100,000 signatures in their support required for registration. The final announcement is expected in late November. Meanwhile, opposition leader Vladimir Neklyaev, widely seen as incumbent president Alexander

Lukashenko’s main rival, may be denied registration as his political movement was closed on Thursday.(Vremya Novostei, Kommersant)

o Russian natural resources ministry seeks to speed up prospecting natural resources in Russia. One possible variant is to let companies choose areas for prospecting and allow several companies to prospect minerals in the same area(Vedomosti)

o The body overseeing the Cyrillic Internet domain said 184,352 addresses were registered as registration was opened to the general public on Thursday. More than 36,000 domain names were registered in the first hour alone, the Coordination Center for the National Internet Domain said on its website (The Moscow Times)

o G20 leaders have little chance to agree on currency issues during the summit in Seoul, but it plays no major role for Russia, Deputy Prime Minister Alexei Kudrin said(Vedomosti)

o Russian Standard, a major Russian vodka producer, has agreed to buy one of Ukraine’s largest alcohol producers Nemiroff (Vedomosti)

o The Russian Orthodox Church is set to boost its missionary work, citing the necessity to conduct “the second Christianization” of Russians(Vremya Novostei)

o Police disclosed the names of four suspects detained in connection with the terrifying mass murder of 12 people in South Russia. The suspects, aged 17 to 23, possibly killed eight adults and four minors in order to be accepted into a local gang(Vremya Novostei, Kommersant, Rossiiskaya Gazeta)

o The Investigative Committee reopened a criminal case into the 2008 attack on journalist Mikhail Beketov, who lost his leg and the ability to speak in the attack.(The Moscow Times, Kommersant, Rossiiskaya Gazeta)

Fradkov Under Fire for Spy Defection - State Duma deputies demanded the ouster of spymaster Mikhail Fradkov on Thursday for failing to expose a double agent in his Foreign Intelligence Service who purportedly betrayed 11 Russian agents to the United States in June.

The Spy Who Loves Them - The Russian Foreign Intelligence Service (SVR) is reportedly reeling from an excruciating “stab in the back,” after revelations that the eleven Russian sleeper spies sent packing from the United States in late June were betrayed by one of their own. Colonel Shcherbakov of SVR's ''C'' department, whose job was to plant agents in the United States, has been identified by an SVR source as the mole who betrayed the Russian spies, the Kommersant business daily reported on Thursday.

Russia's Steve Jobs - Like many great Russian success stories (Faberge, Kalashnikov, Tupolev), Kaspersky bears the name of a single individual: Eugene Kaspersky, who founded the company 13 years ago and is still its chief executive. Or rather, it bears the name of two individuals, as a good deal of the company's success is also due to co-founder and chairman Natalya Kaspersky.

Tracing the Rise of 'The New Nobility' - Fortunately there are inquisitive and intrepid journalists like Andrei Soldatov and Irina Borogan to bring nuance, analysis and old-fashioned shoe-leather reporting to the subject of the revival of

Russia’s security services. In their new book “The New Nobility,” Soldatov and Borogan — co-founders of the Agentura.ru web site — provide a sober look at the increasing influence of the KGB’s main successor, the Federal Security Service, or FSB, on the country’s affairs under Putin.

Next Cold War heated with natural gas? - Russia launched the South Stream pipeline not for energy reasons but to pull Ukraine eastward, a strategy that could spark a Cold War-like conflict between Europe and Russia, former German Foreign Minister Joschka Fischer has warned.

National Economic Trends RUSSIAN MONETARY BASE UP TO 5302.0 BLN RUBLES IN A WEEK TO

NOVEMBER 8 - CB  DOLLAR RISES 17 KOPECKS TO 30.75 RUBLES; RUBLE SLIGHTLY

LOWER AGAINST CURRENCY BASKET  RTS INDEX DOWN 0.6% TO 1,620.11 PTS AT OPEN ON FRIDAY Russian Share Sales to Reach Four-Year High in 2011, VTB Says - Initial public

offerings mainly in the mining, chemicals and retail industries will probably total $20 billion in 2011, while the state privatization program may raise another $7 billion to $8 billion, said Elena Khisamova, head of equity markets at VTB Capital.

Bofa Cuts Russian 2010 GDP Growth Outlook, Raises 2011 Forecast TABLE-Russia monetary base rises to 5.30 trln rbls

Business, Energy or Environmental regulations or discussions Norilsk Nickel, Novatek, Polyus Gold, Tatneft: Russian Preview Stimulus fuels two-year high - Led by gas company Novatek Russia’s exchanges

hit a two-year high driven by higher oil prices following the US government’s decision to continue its stimulus program.

Russia's RUSAL shares fall 9 pct after results Rusal Third-Quarter Profit Falls 55% on Derivatives (Update2) RusAL posts $1.42 bln IFRS net profit in Jan.-Sept. Russia exported 173,900 metric tons of nickel in January-September, some 0.4%

less than in January-September 2009, the federal customs service reported Mitsubishi Revives $1Bln Tatarstan Fertilizer Factory Polyus Gold close to sorting out KazakhGold? - Interfax reported yesterday that

Polyus Gold could sign an agreement with the Assaubayev family (former shareholders of KazakhGold) on Monday, agreeing to return KazakhGold assets (namely Kazakhaltyn) to the Assaubayevs, but retain KazakhGold as a Jersey-registered entity, which is effectively a shell with no assets. No details on the transaction were disclosed.

Russia to build Omsk airport in 2011 Polyus Gold may agree next week to return gold assets in Kazakhstan to the

Assaubayev family and retain the London-listed KazakhGold Group entity that the mining company has sought to use to attract more investors, Interfax reported Thursday. (Bloomberg)

The Deposit Insurance Agency’s total insurance fund, including bank contributions, will be 142 billion rubles at the end of 2010, the agency’s director, Alexander Turbanov, said Thursday. (Interfax)

Merrill Lynch signed an agreement with the Federal Property Management Agency on managing the sale of 10 percent of VTB Group, the agency said Thursday. (Bloomberg)

Sberbank said Thursday that it signed an agreement with American Express to start issuing the U.S. company’s credit cards denominated in dollars, euros or rubles “early in 2011.” (Bloomberg)

Activity in the Oil and Gas sector (including regulatory) Naftogaz shall pay Russia for gas $1 billion a month in Q4 Russian crude free from reliance on transit countries - A representative of pipeline

operator Transneft claimed this morning that Russia is to cease shipping crude through Ukraine and Belarus, adding that the country is soon to be entirely free from reliance on transit countries, Oil & Gas Eurasia reports.

Russia To Stop Shipping Crude Via Ukraine and Belarus - Russia will stop shipping crude through Ukraine and Belarus, Transneft First Vice President Mikhail Arustamov said adding that Russia had actively used the ODessa-Brody and Brody-Yuzhniy pipelines when it did not have enough export capacity. But, he said, with the East Siberia-Pacific Ocean pipeline opened, this lack of capacity has been almost completely alleviated, NEWSru.com reports.  

First Post-Soviet Refinery to Start Sales and Expand Oil consignment delivered to Thailand from Sakhalin Rosneft Subsidiary Acquires Rights To Three Oil-bearing Blocks Bashneft may pay 104.5 rubles per share for 9 mths Lukoil invests $550 mln in Ukrainian petrochemical subsidiary Fitch downgrades outlook on Novatek's BBB- rating to Negative on increasing

debt concerns Belarus refining of Russian duty-free oil to drop sharply in 2H 2010

Gazprom

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Full Text Articles

Basic Political Developments

MAJOR EVENTS LATER THIS MONTH

http://www.prime-tass.com/news/show.asp?topicid=0&id=700000219

Nov 13: Working day, falling on Saturday

Nov 13: Prime Minister Vladimir Putin to visit Bulgaria

Nov 13–14: President Dmitry Medvedev to attend Asia–Pacific Economic Cooperation forum summit in Japan

Nov 14: President Dmitry Medvedev to meet with US President Barack Obama on sidelines of Asia–Pacific Economic Cooperation summit in Japan

Nov 16–19: Slovenian President Danilo Turk to make official visit to Russia

Nov 17: President Dmitry Medvedev to hold talks with Slovenian President Danilo TurkNov 19–20: President Dmitry Medvedev to take part in Russia–NATO summit in LisbonDec 1–2: President Dmitry Medvedev to take part in OSCE summit in AstanaDec 3: President Dmitry Medvedev to meet Italian Prime Minister Silvio Berlusconi in SochiDec 7: Russia–EU summit in Brussels

Lavrov hopes new US Congress will give up short-term considerations

http://www.itar-tass.com/eng/level2.html?NewsID=15674284

12.11.2010, 11.47

SEOUL, November 12 (Itar-Tass) - Russia hopes that not short-term considerations of the domestic policy, but realization of national interests and the need for stronger relations with Russia should prevail in the new U.S. Congress, Foreign Minister Sergei Lavrov said on Friday.

“I hope that in the Congress not short-term considerations in an attempt to outplay other political party, but realization of the United States’ deep interests will prevail,” he said in a reply to journalists’ question how the change in the balance of forces in the U.S. Congress will affect Russia-U.S. relations.

“The term ‘reset’ of relations means that the U.S. administration realizes the need for changing the policy towards Russia,” Lavrov said.

The diplomat noted that at present, changes in the atmosphere of cooperation really take place, which is proved first of all by the signing of the strategic arms reduction treaty that “we hope will be ratified this year.”

“As to the influence of the results of the U.S. congressional elections I will not make suppositions, domestic problems had always played their role that affected the foreign policy,” Lavrov said.

November 12, 2010 11:52

Medvedev aware of U.S.-Russian spy scandal (Part 2)http://www.interfax.com/newsinf.asp?id=201414

SEOUL. Nov 12 (Interfax) - Russian President Dmitry Medvedev has said that he was informed of all the details of the recent spy story involving Russian citizens in the United States.

"I learned all the details on the same day that it happened," Medvedev said in Seoul on Friday.

"I would not like to comment on the investigative process," he said.

"There must be an inquiry and conclusions must be made," the president added.

kk mj

RF should draw proper lessons from RF espionage case in UShttp://www.itar-tass.com/eng/level2.html?NewsID=15674277&PageNum=0

12.11.2010, 11.47

SEOUL, November 12 (Itar-Tass) -- Russia should draw proper lessons from the exposure of Russian spies in the United States, Russian President Dmitry Medvedev said in reply to a question how this scandal will affect the intelligence recruitment policy in particular.

“As for me, it was not the news for me, I learnt about it on that day, when it happened with all the proper features,” the Russian president stated in comments on the recent article in a newspaper about the former Russian foreign intelligence officer, who gave up Russian spies. “The proper investigation should be carried out and proper lessons should be drawn,” Medvedev underlined.

Russia ready to work with U.S. on missile shield

http://www.rbcnews.com/free/20101112115351.shtml

      RBC, 12.11.2010, Seoul 11:53:51.Russia is prepared to participate in the project for the creation of a joint missile shield with the U.S., provided that the participating

parties are all considered equal, Russian Foreign Minister Sergei Lavrov told journalists in Seoul today. "This kind of cooperation is quite possible if it is based on parity in everything, starting from the assessment of potential risks," he stated. According to Lavrov, if NATO indicated that it was open for mutually beneficial cooperation, Russian President Dmitry Medvedev would explain Moscow's position at the upcoming NATO summit in Lisbon. As the minister noted, even if the joint project is carried out, it will not be directed against any country.

      Lavrov expressed hope that even though the parties were not looking to create a joint coordination center for the missile shield, they would reach some kind of compromise on future joint actions.

      Earlier, NATO Secretary General Anders Fogh Rasmussen suggested engaging Russia and other partners of the alliance for the creation of a missile defense system. The next NATO summit has been scheduled for November 19-20 in Lisbon. The Russian president has already announced that he would personally participate in the venue.

November 12, 2010 10:56

Russia, NATO unlikely to create joint missile defense system – Lavrovhttp://www.interfax.com/newsinf.asp?id=201386

SEOUL. Nov 12 (Interfax) - Russian Foreign Minister Sergei Lavrov has said that Russia and NATO are unlikely to manage to create a joint missile defense system.

"I do not think that we and NATO will have one key to the missile defense system: either we will give ours or they will give theirs," Lavrov told journalists in Seoul on Friday.

kk mj

URGENT: Russia ready to cooperate with NATO on missile defense in interests of all - Lavrovhttp://en.rian.ru/world/20101112/161301788.html

11:14 12/11/2010SEOUL, November 12 (RIA Novosti) - Russia is ready to cooperate with NATO on the question of missile defense and create a missile defense pool on condition that the security of all nations is taken into consideration, Russian Foreign Minister Sergei Lavrov said on Friday.

"This is a more or less hot topic. NATO has proposed cooperation to Russia on this topic. We have heard clarification about what forms this may proceed in. If we proceed on the

basis of equal cooperation, starting with a joint analysis, joint assessment of risks, which exist in the sphere of missile proliferation , then such cooperation is completely feasible," Lavrov said.

He said the Russian President was ready to establish additional proposals which he had already prepared, "on the subject of creating a missile pool of interested states with the participation of Russia, the USA and the European states."

"In Lisbon, President Medvedev will lay out our position on these questions. In the presence of a favorable atmosphere, and readiness for cooperation as equals, and mutual respect taking into account the interests of each other, such a project is possible, Lavrov said.

Moscow believes Russia-NATO summit to end 'post-Cold War' period - Lavrovhttp://en.rian.ru/russia/20101112/161301585.html

11:04 12/11/2010

Russia believes the Russia-NATO summit in Lisbon will completely put an end to the post-Cold War period and set guidelines toward a strategic partnership, Russian Foreign Minister Sergei Lavrov said on Friday.

"I hope that as we agreed with [NATO Secretary General Anders Fogh] Rasmussen that we will put an end to the post-Cold War period," Lavrov told journalists in South Korea.

Lavrov said that it would not be simple to draw out the guidelines but the tasks would be formulated toward a strategic partnership.

"During that period (post-Cold War) there was much said about the past, there were elements of distrust and elements of dodging pledges made in the 1990s, especially in regard to the indivisibility of security."

SEOUL, November 12 (RIA Novosti) 

  Moscow welcomes London's intentions to improve bilateral relations http://en.rian.ru/russia/20101112/161302452.html

11:46 12/11/2010

Russian Foreign Minister Sergei Lavrov on Friday welcomed the British government's intentions to improve soured relations with Moscow.

Britain froze ties with Russia following the controversial death of former KGB officer Alexander Litvinenko in London in 2006.

Relations between Moscow and London were then hampered by Russia's bureaucratic pressure on the British Council and Britain's criticism of Moscow in the wake of the Russian-Georgian military conflict in August 2008.

"Ice [in Russian-British ties] is a relative concept. We have never frozen Russian-British ties since it is one of the most important issues in Russian policy. Russian and British business cooperation shows that life makes us develop good relations instead of obstacles," Lavrov said.

On Thursday, Russian President Dmitry Medvedev met with British Prime Minister David Cameron during a meeting of G20 leaders in Seoul.

Russia and Great Britain are "ready in cooperation as their views matched on many issues," Medvedev said after the meeting with Cameron.

SEOUL, November 12 (RIA Novosti)

Rushing inhttp://www.sofiaecho.com/2010/11/12/992195_rushing-in

Fri, Nov 12 2010 09:00 CET by Alex Bivol Making one of his last state visits before stepping down as president of Russia, Vladimir Putin was in Sofia in January 2008 to sign what Bulgarian President Georgi Purvanov called a "Grand Slam" of energy deals: contracts for the construction of the Belene nuclear power plant, South Stream gas pipeline and Bourgas-Alexandroupolis oil pipeline.

Less than two years later, prime minister Putin is set to return to Sofia in an attempt to salvage as much of that legacy as possible.

Putin will visit Bulgaria on November 13 and will meet his counterpart Boiko Borissov, with analysts predicting that the Russian prime minister will secure major advances on the two bigger projects, with little or no discussion expected on the Bourgas-Alexandroupolis pipeline, where Bulgaria is unhappy with the environmental issues raised by the project.

But the other two are both of key importance for Moscow: Belene is slated to become the first Russian nuclear plant built in the European Union, which Russia hopes will open future opportunities on a continent where nuclear power is seeing renewed interest, while South Stream is meant to prevent a possible decline of Russia's importance as a key natural gas source for the bloc, as well as give Moscow further leverage in case of future gas transit disputes with Ukraine.

Ahead of the meeting, Putin and Borissov spoke three times on the phone in as many weeks, according to reports in Sofia and Moscow. Putin's personal diplomacy appeared to have the desired effect – since taking office in July 2009, Borissov has refused to unequivocally commit Bulgaria to any of the three projects, without ever outright dismissing them, but he now appeared ready to give a fresh impetus to Belene and South Stream.

Putin and Borissov were expected to sign the agreement on behalf of Gazprom and Bulgarian Energy Holding to set up a joint venture that would build and operate South Stream's stretch in Bulgaria after the Bulgarian Cabinet approved a resolution to that effect on November 10.Speaking earlier in November, Borissov said that he would like to see official assistance from Moscow to Bulgarian exports to Russia, giving rise to speculation that the two issues could be related.Bulgaria's Economy and Energy Minister Traicho Traikov, speaking to journalists after the Cabinet meeting on November 10, refused to be drawn in: "You will have to ask the two prime ministers whether the contract with Gazprom is diplomatically linked to future trade turnover".

On Belene, some reports in local media said that during his meeting with Putin, Borissov would finally give a definitive answer whether Bulgaria planned to go ahead with the project or scrap it.

Serbia has officially confirmed interest in taking a small stake and Croatia declined the opportunity in the days before Putin's visit, but Bulgaria had made no progress in months with picking a financial adviser that would re-assess the plant's viability.

Czech Relations Improving http://www.themoscowtimes.com/business/article/czech-relations-improving/422514.html

12 November 2010

Russia and the Czech Republic stand “an excellent chance” of bringing the volume of their economic relations, which has shrunk heavily after the global financial crisis, to its pre-crisis level by the end of 2010, Prime Minister Vladimir Putin said Thursday.

“Despite the decline in trade and economic interaction between our countries last year — it was a substantial decline, 38 percent — we are overcoming those difficulties quite confidently at the moment, and for the first eight months of this year, we had growth of 32 percent. So we have an excellent chance of achieving the pre-crisis level before the end of this year,” Putin said during a meeting with Czech President Vaclav Klaus.

Putin named energy, manufacturing, finance and transportation as industries where the two countries have, according to him, good opportunities for cooperation. Klaus also expressed hope that economic relations would improve and said he planned a meeting with Russian business figures for Friday.

(Interfax)

11 november 18:33

Prime Minister Vladimir Putin meets with Czech President Vaclav Klaus

http://premier.gov.ru/eng/events/news/12893/

Events / Photos During the conversation, Vladimir Putin expressed satisfaction with how both countries have handled the decline in trade and economic relations in 2009. He also highlighted “the good prospects in the energy sector, industry, the financial sector, and transport.” Vaclav Klaus, for his part, stressed that expanding economic and other relations “is in the best interests of both countries.”

Transcript of the beginning of the meeting:

Vladimir Putin: Mr President, ladies and gentlemen! I am pleased to meet with you here in Moscow.

Vaclav Klaus: There’s no need to translate for us. We understand everything. Maybe just help us a bit.

Vladimir Putin: Excellent! I am pleased to note that despite the 38% decline in our trade and economic cooperation last year, we are steadily overcoming these difficulties. In the first nine and even eight months of this year, growth was 32%, so we can definitely reach pre-crisis levels by the end of the year.

We have very good prospects in the energy sector, industry, the financial sector, and transport. We are glad to see you and to have an opportunity to discuss all aspects of our relations. Welcome!

Vaclav Klaus: Thank you very much. I’m glad we have this chance to meet. I was invited to Moscow by a group of Russian bankers. I will give a speech to them this evening. It’s fortunate that I am able to meet with you as well.

I was last here in May, on May 9, to be exact. We had a brief conversation over lunch.

Vladimir Putin: Right.

Vaclav Klaus: As an economist, I am familiar with these data. Very serious. I hope the decline is a result of what happened in the world in 2009. Hopefully things will get better.

We have a meeting tomorrow organised by the Czech Export Bank. That’s why I’m here. The meeting will include a wide variety of Russian entrepreneurs, about 10 or 15 governors and several presidents. And I promised to be there, too.

I believe it is in the best interests of both countries to develop our economic and other relations. This is the main point I would like to make: there are various projects, and Mr Putin is aware of many opportunities existing in infrastructure, the power industry and so forth. We are prepared to make steps in this direction.

Vladimir Putin: The intergovernmental commission, whose Russian delegation is headed by Mr Zhukov, is working diligently. I will ask him to speak about how work is proceeding on the ground.

Greens attack Australia's move to sell uranium to Russiahttp://timesofindia.indiatimes.com/world/rest-of-world/Greens-attack-Australias-move-to-sell-uranium-to-Russia/articleshow/6912726.cms

AFP, Nov 12, 2010, 12.53pm IST

SYDNEY: Environmentalists on Friday attacked Australia's decision to sell uranium to Russia, voicing concerns over safety standards and a lack of inspections.

Prime Minister Julia Gillard and Russian President Dmitry Medvedev, both in Seoul for the G20 Summit, Thursday ratified a nuclear cooperation agreement allowing Australian uranium to be enriched in Russia and used in Russian nuclear reactors.

But Greens party spokesman Scott Ludlam said the case against selling uranium to Russia was "undeniable."

"Russia is a key part of the Iranian nuclear programme and has not been visited by IAEA inspectors since 2001," he said.

"This is an example of short-term profits taking precedence over long-term health and security interests."

Under a 1990 arrangement, Australian uranium could be processed in Russia for a third country's use but could not be used for power generation in Russia.

The new agreement allowing Australian uranium to be enriched in Russia was signed in Australia in 2007, but its ratification was opposed by a parliamentary committee over

safety issues.

Legislators had called for the deal to be blocked unless Russia met a number of conditions, including speeding up reforms to separate civilian and military nuclear plants.

Gillard said the new agreement met all of Australia's and the International Atomic Energy Agency's nuclear safeguards, with all nuclear material transferred to Russia to be used solely for peaceful, non-military purposes.

But environmentalists doubted the safeguards in the deal.

"The federal government's decision to sell uranium to Russia puts the interests of one contested industry ahead of Australia's national interest and global responsibilities," said the Australian Conservation Foundation's David Noonan.

Australia has a large proportion of the world's uranium deposits and Gillard said the new agreement would increase export opportunities and create jobs, as well as consolidating the country's position as a reliable provider of energy resources.

Delayed RF-Japan doc signing not linked with Medvedev visit

http://www.itar-tass.com/eng/level2.html?NewsID=15674054&PageNum=0

12.11.2010, 11.16

TOKYO, November 12 (Itar-Tass) -- The delayed signing of a Russian-Japanese economic protocol planned on Friday is not linked with Russian President Dmitry Medvedev’s visit to the South Kuriles, Chief Cabinet Secretary Yoshito Sengoku told a news conference here on Friday.

Minister of Economy, Trade and Industry Akihiro Ohata said at a meeting of the parliament’s committee earlier on Friday that a protocol on cooperation with the Russian Ministry of Economic Development was not signed in protest against the Russian president’s visit to the South Kuriles, which Tokyo considers the country’s northern territories.

The leaders of the countries will meet at an APEC summit in the Japanese city of Yokohama on Saturday.

Japan refuses to sign economic protocol with Russia

http://www.itar-tass.com/eng/level2.html?NewsID=15673652

12.11.2010, 09.49

YOKOHAMA, November 12 (Itar-Tass) -- Japan refused to sign a protocol on economic cooperation with Russia on Friday in protest against Russian President Dmitry Medvedev’s visit to the South Kuriles, Japanese Minister of Economy, Trade and Industry Akihiro Ohata said at a meeting of a committee of the lower house of parliament in Tokyo on Friday.

“The issue of northern territories is very important. The actions of the Russian president encroach on the thoughts and feelings of the Japanese about these lands,” he said.

The Russian Ministry of Economic Development and the Japanese Ministry of Economy, Trade and Industry were planning to sign a protocol on cooperation at the ongoing bilateral investment forum in Tokyo. In this document having no binding force the sides called for continued joint coordination in the development of contacts in export-import operations and investments.

However, the bilateral investment forum is a sufficient success on Friday in the presence of the chief executives of major companies of the countries and the governors of several Russian regions.

Tokyo has earlier voiced an official protest to Russia against Medvedev’s visit to the South Kuriles. The Japanese ambassador was temporarily recalled from Moscow for consultations, but he was brought back to Russia several days later to prepare a bilateral meeting of the leaders of the countries, which is expected at an APEC summit in the Japanese city of Yokohama on Saturday. After the visit of the Russian president to the South Kuriles the radical members in the Japanese government offered to study the issue of economic sanctions against Russia. However, they abandoned these intentions quickly under the influence of the business quarters interested in trade and investment relations with Russia.

Japan firms get Russian order for power-heat cogeneration systemshttp://mdn.mainichi.jp/mdnnews/business/news/20101112p2g00m0bu041000c.html

Tokyo (Kyodo) -- Kawasaki Heavy Industries Ltd. and Sojitz Corp. said Thursday they have jointly landed an order from a Russian government-backed firm for 35 gas turbine cogeneration systems for the Russian Far East, valued at approximately 24 billion yen.

Kawasaki Heavy and Sojitz will sign an agreement Friday to supply the systems between 2011 and 2014 with the Vladivostok-based Far Eastern Center for Strategic Research on Fuel and Energy Complex Development, the two said.

Russia is now laying down a 1,800-kilometer natural gas pipeline to link Sakhalin with Vladivostok via Khabarovsk.

The cogeneration systems, consisting of gas turbine power generation systems and hot water boilers, will supply electricity and hot water to cities, towns and villages along the pipeline, the duo said.

On top of the 35 systems, the duo plans to supply some 200 cogeneration systems in stages down the track under a framework agreement with the Russian side, they said.

In 2009 and earlier this year, the companies received separate orders to supply seven cogeneration systems for the venue for the Asia-Pacific Economic Cooperation forum to be held in 2012 at Russky Island in Vladivostok.

(Mainichi Japan) November 12, 2010

Gas Deal With Japan May Stall http://www.themoscowtimes.com/business/article/gas-deal-with-japan-may-stall/422506.html

12 November 2010Bloomberg

Gazprom chief executive Alexei Miller canceled a visit to Japan to discuss a potential natural gas project, raising the possibility that an agreement may be postponed, a Japanese trade ministry official said Thursday.

Viktor Timoshilov, head of Gazprom’s Eastern projects division, will still meet with trade ministry officials Friday, said Hirohide Hirai, director of the petroleum and natural gas division at the trade ministry.

Gazprom told Japanese officials that Miller canceled because he had other matters to address, without being specific, Hirai said.

The cancellation by the CEO of the state-owned company comes after Japan recalled its ambassador to Moscow in response to President Dmitry Medvedev’s Nov. 1 visit to islands claimed by both countries.

Japanese Prime Minister Naoto Kan said earlier this week that he hoped to meet separately with Medvedev during an Asia-Pacific Economic Cooperation summit in

Yokohama over the weekend and that he would assert Japan’s claim to the disputed island chain.

Gazprom, the world’s largest gas producer; Japan’s Ministry of Economy, Trade and Industry; Itochu Corporation; and Japan Petroleum Exploration Company in May 2009 signed an initial agreement to study the feasibility of an LNG plant in Vladivostok on Russia’s eastern coast.

Vladivostok lies across the sea that separates Russia from Japan, the world’s biggest buyer of liquefied natural gas.

Russia, Japan leaders to meet amid islands spat

http://www.reuters.com/article/idUSTRE6AB0M420101112

By Gleb Bryanski

SEOUL | Fri Nov 12, 2010 1:39am EST

SEOUL (Reuters) - The leaders of Russia and Japan will meet of the sidelines of a regional summit, talks certain to be dominated by their latest flare up over islands both claim.

Russian President Dmitry Medvedev infuriated Tokyo by visiting one of the islands -- called the Southern Kuriles in Russia and the Northern Territories in Japan -- on November 1, ahead of this weekend's Asia-Pacific Economic Cooperation (APEC) summit in Yokohama, Japan.

The Soviet Union occupied the four at the end of World War Two and the territorial row has weighed on relations between Tokyo and Moscow ever since, preventing the signing of a formal peace treaty.

"The timing (of the talks with Japanese Prime Minister Naoto Kan) is still being agreed. They will discuss the Russian-Japanese relationship," Medvedev spokeswoman Natalya Timakova told reporters.

She said the Russian position on the disputed islands had not changed and that Japan traditionally raises the territorial dispute issue at such meetings.

Medvedev's trip to the island has prompted the two sides to put off signing a memorandum on economic cooperation that had been planned at an investment forum in Tokyo on Friday, Kyodo news agency reported.

The memorandum would have reaffirmed existing plans for cooperation and efforts to boost trade and investment, it said.

"The (Russian) president's move was one that trampled on the feelings of the Japanese people," Japanese Trade Minister Akihiro Ohata was quoted as saying in parliament.

Separately, the Nikkei business daily reported on Thursday that an agreement between the Japanese government and Russia's gas giant Gazprom on a liquefied natural gas project has been delayed after the head of Gazprom canceled a trip to Japan.

Japanese Foreign Minister Seiji Maehara has said that a visit by Medvedev to the islands would "severely harm" relations. Moscow has said Medvedev plans more visits to the islands.

Russia's foreign ministry responded that Japan's claim to the islands, which stretch northeast from Japan's main northern island of Hokkaido to Russia's Kamchatka Peninsula, was a "dead-end".

The islands are close to oil and gas production regions of Russia, but most people live off fishing and Japan, a major fish consumer, would gain rich fishing grounds.

Japan is also embroiled in a territorial dispute with China after Japan detained the skipper of a Chinese fishing boat after it collided with Coast Guard ships near disputed isles in the East China Sea. He was later released and sent home.

The Japanese government's handling of the two disputes has been heavily criticized at home and been a factor in the recent sharp fall in its support ratings.

(Reporting by Gleb Bryanski in SEOUL, Chisa Fujioka in TOKYO; editing by Jonathan Thatcher)

Medvedev to meet with Japanese leader during APEC summithttp://en.rian.ru/russia/20101112/161299318.html

Despite the recent diplomatic spat between Moscow and Tokyo, Russian President Dmitry Medvedev will meet with the Japanese premier during the forthcoming APEC summit, Medvedev's spokeswoman confirmed on Friday.

The Russian leader is to meet with Japanese Prime Minister Naoto Kan on the sidelines of the Asia Pacific Economic Cooperation (APEC) summit to be held on November 13-14 in Yokohama. Kan said last week he was not sure if the meeting with Medvedev would go ahead.

"The Japanese side traditionally raises the issue of the Kuril Islands at such meetings. Russia's position remains unchanged," Natalya Timakova said.

A long-standing territorial dispute between Moscow and Tokyo over the Kuril Islands, called the Northern Territories by Japan, was aggravated by a recent visit by Medvedev to one of the islands. Tokyo has described the visit, the first trip by a Russian president to the disputed islands, as "regrettable," while Moscow argued it is up to the Russian authorities to decide on their trips inside the country.

Following the row sparked by Medvedev's visit, Japan temporarily recalled its ambassador from Russia. The ambassador was to return to Moscow on Sunday as the Japanese government decided to refrain from further actions of protest.

 

SEOUL, November 12 (RIA Novosti)

Medvedev and Kan to Hold Japan-Russia Talks at APEC (Update1) http://noir.bloomberg.com/apps/news?pid=newsarchive&sid=a2QlWDi0s7Lw

By Lyubov Pronina and Sachiko Sakamaki

Nov. 12 (Bloomberg) -- Russian President Dmitry Medvedev and Japanese Prime Minister Naoto Kan will hold talks this weekend at an Asia-Pacific leaders summit as the two sides aim to repair ties damaged by a territorial dispute.

The two leaders will meet when Kan hosts the two-day Asia- Pacific Economic Cooperation forum in Yokohama, Japan, Kremlin spokeswoman Natalya Timakova said today in Seoul. Medvedev and Kan are both in South Korea attending the Group of 20 summit.

“A meeting between President Dmitry Medvedev and the Japanese Prime Minister is being planned on the sidelines of the APEC summit,” Timakova told reporters. “We are coordinating the time.”

Medvedev on Nov. 1 became the first Russian leader to visit one of four islands called the Southern Kurils in Russia and the Northern Territories in Japan claimed by both countries. Kan this week said he hoped to meet with Medvedev, saying he would “emphasize” that the islands belong to Japan.

The Soviet Union seized the islands six miles (10 kilometers) from Japan’s Hokkaido Island at the end of World War II, and the sovereignty dispute has prevented Russia and Japan from signing a formal peace treaty. About 10,300 people live on the disputed

islands, with 7,100 of them on Kunashir, the site of Medvedev’s trip, according to the Kremlin.

“Various issues of our bilateral relations are on the agenda,” Timakova said. “The Japanese side traditionally raises the question about the Kuril Islands during such meetings. Russia’s position on this issue traditionally hasn’t changed.”

To contact the reporters on this story: Sachiko Sakamaki in Tokyo at Ssakamaki1@bloomberg.net; To contact the reporter on this story: Lyubov Pronina in Seoul via Moscow office at lpronina@bloomberg.net.

Last Updated: November 11, 2010 23:23 EST

Russian, Japanese leaders to meet amid island rowhttp://www.channelnewsasia.com/stories/afp_asiapacific/view/1093039/1/.html

Posted: 12 November 2010 1244 hrsSEOUL: Russian President Dmitry Medvedev plans to meet Japanese Prime Minister Naoto Kan in Yokohama this week but Moscow's position on disputed territory remains unchanged, Medvedev's spokeswoman said Friday.

"During such meetings Russia's position remains traditionally unchanged," spokeswoman Natalia Timakova told reporters on the sidelines of the G20 summit in Seoul.

Medvedev will go on from Seoul to Yokohama to take part in the Asia-Pacific Economic Cooperation forum summit. The details of the upcoming meeting with Kan are now being agreed.

Medvedev infuriated Japan this month by making the first trip by a Russian leader to one of four Pacific islands at the heart of the territorial dispute.

The Russian president -- who stayed on Kunashir Island for less than four hours -- caused the worst diplomatic spat between the two countries in years amid fragile attempts to expand economic contacts.

The dispute over the Kuril islands, known as the Northern Territories in Japan, has prevented the signing of a post-war peace treaty.

-AFP/wk

No kimonos for world leaders during APEC summithttp://en.rian.ru/world/20101112/161300222.html

09:13 12/11/2010

Foreign leaders at the Asian-Pacific Economic Cooperation (APEC) summit in Yokohama on November 13-14 will not be asked to wear the host nation's traditional kimono.

Though no official reason has been given by the Japanese government on why the informal tradition of donning the host country's native garb during the summit, many believe the move was made so as not to make the leaders of China and South Korea "uncomfortable."

Observers have supposed that kimonos will not be worn as China and Korea are very sensitive to Japan's colonization of Asia in the past. They also pointed out tensions in Chinese-Japanese relations in regard to disputed islands between the two countries and that Chinese leader Hu Jintao would most likely be very uncomfortable wearing a kimono during the APEC summit.

Russian President Dmitry Medvedev will also be present at the summit. Russian and Japanese relations have also become tense after Medvedev's recent trip to a disputed island in the Kuril Island chain.

A long-standing territorial dispute between Moscow and Tokyo over the Kuril Islands, called the Northern Territories by Japan, was aggravated by Medvedev's visit. Tokyo has described the visit, the first trip by a Russian president to the disputed islands, as "regrettable," while Moscow argued it is up to the Russian authorities to decide on their trips inside the country.

Following the row sparked by Medvedev's visit, Japan temporarily recalled its ambassador from Russia. The ambassador returned to Moscow as the Japanese government decided to refrain from further actions of protest.

Informal national attire during APEC summits was first introduced in Seattle in 1993. The leaders were then given leather jackets to wear. Since then the leaders of the Asian-Pacific countries have worn the host nation's clothes to pose for photo shoots.

TOKYO, November 12 (RIA Novosti) 

G20 Summit Seoul

URGENT: G20 summit to seriously lessen currency war threat - Medvedevhttp://en.rian.ru/russia/20101112/161302847.html

12:09 12/11/2010

SEOUL, November 12 (RIA Novosti) - Decisions taken at the latest G20 summit have seriously eased the threat of a currency war, Russian President Dmitry Medvedev said on Friday.

"I think that the threat of a possible so called currency war has been at least seriously reduced after the summit, and there is reason to be more optimistic about the future," Medvedev said at a news conference after t

Russia to seek adoption of convention on oil spill prevention at next G20 summit - Medvedevhttp://en.rian.ru/russia/20101112/161302626.html

12:00 12/11/2010

Russia will seek the adoption of a convention on oil spill prevention at the next G20 summit, Russian President Dmitry Medvedev said on Friday.

"I was informed that we will come back to this issue next year, including the possibility of adopting a convention dedicated to the consequences of oil spills," Medvedev said at a press conference after the G20 meeting in South Korea.

The current international legal base does not effectively prevent such consequences, evidence of which became the oil spill in the Gulf of Mexico, Medvedev said.

SEOUL, November 12 (RIA Novosti) 

BRIC countries approve of including S.Africa in group - Medvedevhttp://en.rian.ru/world/20101112/161302542.html

11:54 12/11/2010

The rapidly developing countries of BRIC (Brazil, Russia, India, China) approve of the idea of including South Africa into the forum, Russian President Dmitry Medvedev said on Friday.

"There are a number of requests from countries to join the BRIC group, including the request from the Republic of South Africa," Medvedev said at a press conference in South Korea.

"We respond positively to these types of requests, and in this case today (South Africa's request), there is a united position by all the BRIC countries. So, make the conclusions yourselves," he added.

SEOUL, November 12 (RIA Novosti) 

G20 against U.S. idea of current account limits - Kremlin aidehttp://en.rian.ru/business/20101112/161300935.html

10:01 12/11/2010

SEOUL, November 12 (RIA Novosti) - G20 countries did not support the U.S. initiative to limit current account balances to four percent of gross domestic product, presidential economic adviser Arkady Dvorkovich told journalists on Friday.

Last month, the United States put forward the idea of current account limits as a method to forestall a situation when imbalances can cause problems in the global trading system.

"The U.S. did not make this proposal again because it was not supported by the [G20] finance ministers," Dvorkovich said. "We think that pulling out one indicator from a number of others is inappropriate."

G20 to agree to avoid 'artificial devaluations': Russia

http://business.asiaone.com/Business/News/Story/A1Story20101112-246966.html

Fri, Nov 12, 2010AFP

SEOUL, South Korea - Group of 20 countries will agree Friday to avoid "artificial devaluations" in currencies, the top economic adviser to Russia's president said, as G20 leaders prepared to issue a summit statement.

"As far as 'currency wars' are concerned, there is an explicit directive that there is a need to avoid artificial devaluations," Arkady Dvorkovich, adviser to President Dmitry Medvedev, told reporters at the G20 in Seoul.

Washington has long accused China of keeping its currency artificially low to boost exports. But China now counters that the Federal Reserve's plan to pump 600 billion dollars into the US economy will have harmful spillovers.

"Russia's position is - and it is fully reflected in the summit documents, we are pleased with this - that actions in this (stimulus) sphere should be coordinated and there is a need to avoid unilateral activities that can cause excessive risks," Dvorkovich said.

The G20 leaders were expected to endorse a stand made last month by their finance ministers to "refrain from competitive devaluation of currencies" and aim for "more market-determined exchange rate systems".

Russia won't invest in troubled economies says Kremlin aidehttp://en.rian.ru/russia/20101112/161301180.html

10:24 12/11/2010

Russia has no plans to use its sovereign assets to help bale out Ireland, which is facing financial and economic difficulties, presidential economic adviser Arkady Dvorkovich said on Friday.

"We'll adjust our asset management method in line with risks arising in different countries of the world. As far as I know, Ireland and Portugal are now on the list of countries where our sovereign assets must not be invested in the nearest future," Dvorkovich said.

SEOUL, November 12 (RIA Novosti) 

Russia's investment policy to be guided by global economy

http://www.rbcnews.com/free/20101112112150.shtml

      RBC, 12.11.2010, Seoul 11:21:50.Russia will adjust its investment policy in accordance with the situation on the market, including the situation in the European economy, Presidential Aide Arkady Dvorkovich told journalists in Seoul today in response to a question about how Russia viewed the current situation in Ireland and Portugal. Dvorkovich assured reporters that the management of Russia's sovereign funds would be "adjusted in accordance with the risks arising in various countries." He went on to say, "As far as I know, Ireland and Portugal are currently on the list of countries in which our sovereign funds are not expected to be invested in the near future."

Russia content with denunciation of currency warshttp://english.ruvr.ru/2010/11/12/33534014.html

Nov 12, 2010 10:07 Moscow Time

Russia is content with the fact that the G-20 summit has condemned in its final document the artificial devaluation of national currencies. This came in a statement in Seoul by the Russian President’s assistant Arcady Dvorkovich. According to the official, Russia’s stand on the issue has been fully reflected in the summit documents. The parties to the ongoing G-20 summit in Seoul have so far failed to take up Russia’s suggestion on creating a new reserve currency. The participants in the summit are also due to conclude

a framework agreement on moves to ensure sustainable economic growth. Following the Seoul summit Russian President Dmitry Medvedev is slated to hold a press conference.

G20 to draft road map toward macroeconomic policy benchmarks-Kudrin

http://www.itar-tass.com/eng/level2.html?NewsID=15673106&PageNum=0

12.11.2010, 01.50

SEOUL, November 12 (Itar-Tass) -- At the G20 summit in Seoul an agreement will be reached on the need to move toward exchange rates flexibility. However, at this summit no specific decisions will be made, it is expected to give start to a "road map,” Russian Deputy Prime Minister, Finance Minister Alexei Kudrin told the media on Thursday.

"We need to move along the path of increasing the flexibility of exchange rates. Here at the summit, someone suggested setting restrictions on the current account of the balance of payments," Kudrin said. "So far we have been unable to agree this policy will be the main one, but we tasked the IMF and the ministers of finance to probe into such issues by the next summit,” he added." The decision has been taken, we are working on this theme and we are developing mechanisms. But at this summit no such decisions will be taken."

"Today, we shall most probably agree to develop a "road map," said Kudrin.

"We have agreed that the work will be done to draft proposals for the parameters of targeting the current account. Within the framework of the roadmap the dates will be determined for identifying such indicators. The IMF will present a report on these guidelines and on how to implement them," Kudrin said.

"The main proposal is the one for the current account, it looks interesting, but there are others, too,” he said. “Those for other quantitative indicators, such as deficit and debt are parameters close to the Maastricht agreement."

Kudrin replied in the affirmative to the question if the "road map" would bring about a mechanism of more flexible exchange rates. "The discussion of positions will be the main result of the summit, it will be a serious groundwork from which to build up to find solutions," he said.

He added that "on the sidelines of the summit inflation is being discussed."

"Basically, all are oriented towards fairly stringent restrictions on inflation," he said.

S.Korea proposes global financial security network at G20 summithttp://en.rian.ru/business/20101112/161299819.html

08:30 12/11/2010

G20 leaders have supported South Korea's initiative on global financial security, Russian presidential and economic aide Arkady Dvorkovich said on Friday.

South Korea proposed to the world's 20 leading economies the initiative of a global network of financial security because mass inflows and outflows of speculative funds from countries with growing economies create instability factors in economic development.

"These steps in the declaration's project have been supported. The [Russian] president will discuss them during a press conference, which will be right after lunch," Dvorkovich told journalists in Seoul.

He said that Russia along with its partners in BRIC (Brazil, Russia, India, China) with rapidly developing economies suggested taking consumer ability in a larger degree, though "no formulas during the summit were accepted."

SEOUL, November 12 (RIA Novosti) 

Medvedev holds talks with German chancellor, Turkish PM

http://www.itar-tass.com/eng/level2.html?NewsID=15673576&PageNum=0

12.11.2010, 09.16

SEOUL, November 12 (Itar-Tass) -- Russian President Dmitry Medvedev held several working meetings within the framework of the G20 summit. As the Kremlin press service reported, “Medvedev discussed with German Chancellor Angela Merkel and Turkish Prime Minister Recep Tayyip Erdogan issues of mutual interest.”

Medvedev attends G20 plenary meeting in Seoulhttp://english.ruvr.ru/2010/11/12/33514921.html

Nov 12, 2010 03:46 Moscow Time

President Dmitry Medvedev is taking part in a plenary meeting of the G20 summit, now ongoing in Seoul. 

The participating leaders will hold five sessions to focus on the state of the global economy, on signing a framework agreement to ensure sustainable and balanced growth, on reforming international financial institutions and establishing a network of global financial security.

The participants will also look at the meetings further agenda, to include energy, marine ecosystems and corruption.

Medvedev holds working meetings on G-20 fringeshttp://english.ruvr.ru/2010/11/12/33517851.html

Nov 12, 2010 09:23 Moscow Time

Russian President Dmitry Medvedev has held a number of working meetings on the sidelines of the G-20 summit in Seoul, specifically with the German Chancellor Angela Merkel, and Prime Ministers of Italy and Turkey Silvio Berlusconi and Recep Tayyip Erdogan. The G-20 leaders have resumed the discussion they got down to yesterday on bringing the world economy back to normal. Today’s session falls into five meetings to take up specifically the condition of the global economy and conclude a framework agreement to ensure sustainable economic growth. The parties to the meetings will also focus on reforming international financial institutions and creating a global financial security network. They will likewise discuss trade and reforming the financial regulation system.

British investors show interest in Russia's hi-tech hubhttp://en.rian.ru/business/20101112/161300566.html

09:37 12/11/2010

British companies are interested in participating in Russia's hi-tech hub, Skolkovo, a source in the Russian delegation at the G20 summit said on Friday.

On Thursday, Russian President Dmitry Medvedev met with British Prime Minister David Cameron during a meeting of G20 leaders in Seoul.

Medvedev invited Cameron to Moscow saying that Russian companies "are continuing Initial Public Offerings (IPO) on the London Stock Exchange with great pleasure. This should be strengthened."

Cameron in response was highly "interested in the British businessmen's participation as partners in Skolkovo project," the source said.

"The talks were very substantive. Everybody realizes there are difficulties, but they should be solved," the Russian delegation source said.

Medvedev has called on foreign companies to participate in the Skolkovo project that is believed to be Russia's innovation hub.

In October, California Governor Arnold Schwarzenegger, during his visit to Russia, brought to Moscow a delegation of U.S. investors interested in cooperation with the hi-tech hub.

U.S. Microsoft will establish a research and development center in Skolkovo along with the Italy's largest power company Enel that is also set to take part in the ambitious project.

SEOUL, November 12 (RIA Novosti) 

Medvedev to visit India in December for RF-India summit – Sergei Ivanov

http://www.itar-tass.com/eng/level2.html?NewsID=15672862&PageNum=0

11.11.2010, 18.27

MOSCOW, November 11 (Itar-Tass) - Russian President Dmitry Medvedev will visit India in December to attend the Russia-India summit, Vice Prime Minister Sergei Ivanov said.

Speaking at the government presidium on Thursday, Ivanov, co-chairman of the inter-governmental commission, said the commission would gather next week in India to discuss a wide range of issues, due to preparations for the Russian president’s visit to New Delhi in December and his participation in the Russia-India summit.

He noted that India was Russia’s key trade partner, first of all in the field of export. “About 45 percent of our export to India accounts on high tech,” he noted.

Ivanov said trade turnover between Russia and India was not big, but it “is stable”. “During the crisis, in 2009 it increased by 5.7 percent. In the nine months of this year it increases by 23.7 percent. Total trade turnover reaches 10 billion U.S. dollars,” the vice-prime minister said.

He added that Moscow and New Delhi developed nuclear and military-technical cooperation, as well as contacts in the field of information technologies, space and the fuel and energy sector.

Russian plane crashes in West Darfur http://www.sudantribune.com/spip.php?article36912

Friday 12 November 2010November 11, 2010 (KHARTOUM) — A Russian plane crashed while trying to land Thursday in West Darfur killing at least two people and injuring 17 others, Sudanese civil aviation said.

The Antonov An-24 was carrying 36 passengers including the crew left Khartoum at 1.27pm and arrived at Zalingei airstrip at 4.18pm. Upon landing two tires exploded, and the plane split on half then caught fire.

Conflicting reports say six passengers died in the crash of the plane which is owned by a small company, Tarco Air.

However the authorities confirmed the name of one female victim, Hawa Mohamed Abdalla.

Abdallah Mohamed al-Amin, a commissioner of Zalingei said nothing is yet clear at the moment but he assured that the concerned authorities will investigate the incident.

On the other hand, the government of West Darfur state ruled out sabotage as possible cause of the incident, indicating that state security service will visit Friday the airport to inspect the site of the crash.

Aircraft accidents are common in Sudan, where the fleet is aging. Many small local companies employ pilots of the former USSR and use of aircraft manufacturing in Eastern Europe.

Sudanese officials said, no member of the crew, whose nationality was not disclosed, is among the victims.

(ST)

Somali pirates seize freighter with Russian nationalhttp://english.ruvr.ru/2010/11/12/33558532.html

Nov 12, 2010 11:00 Moscow Time

In the Arabian Sea, Somali pirates have seized a freighter with a Russian national on board. The Russian is a member of the vessel’s international crew of Tunisians, Filipinos, Croatians, Georgians and Moroccans. The Hannibal II oil tanker came under attack in a place between the Horn of Africa and India. So far there’ve been no reports about what

may have happened to the 31 seamen. The tanker, owned by a Tunisian company, was en route from Malaysia to Suez.  

Latvia’s speculations over Russian border issues provocative – FM

http://www.itar-tass.com/eng/level2.html?NewsID=15673185&PageNum=0

12.11.2010, 03.59

MOSCOW, November 12 (Itar-Tass) -- The Russian Foreign Ministry has described as provocative attempts by the Foreign Ministry of Latvia to speculate on the theme of the border with Russia, Russian Foreign Ministry deputy spokesman Alexei Sazonov told the media on Thursday.

"In the sphere of bilateral relations between Russia and Latvia the border question is closed," the diplomat said, when answering the question about how Moscow would react to the words of support from the foreign minister of Latvia for territorial claims against Russia. Sazonov recalled that "the agreement on Russian-Latvian state border, which came into force on December 18, 2007, clearly defines the boundary line." "Preparations are being made for demarcation work on site," he added.

"Any attempts at speculations over this topic can be described only as provocative,” the Russian Foreign Ministry official said. “We are certain that they will not meet with the slightest support inside Latvia, either."

However, according to Sazonov, “the Russian Foreign Ministry took note of the passages from correspondence between the Latvian Foreign Minister and Latvian ultra-nationalist resident in the U.S., Aivars Slucis that were made public just recently.” The Russian Foreign Ministry official said "the affair goes beyond the bounds of common sense and leaves an unpleasant aftertaste."

"We expect that the Latvian minister, who has retained his office not without problems due to the scandal, in real life will follow not his prejudices, but the Latvian government’s officially proclaimed policy of building good-neighborly relations with Russia," the diplomat said.

On Wednesday, the Latvian parliament did not support the opposition's demand for dismissing Foreign Minister Girts Valdis Kristovskis. This initiative was supported by 36 members of parliament, while 51 opposed it, and twelve abstained. The resignation demand came from two oppositional political parties representing the interests of Russian-speaking residents of the country – the Center of Accord party and the alliance For better Latvia. The motion followed last week’s publication in the Internet of scandalous e-mails between Kristovskis and Latvian doctor Aivars Slucis residing in the U.S. In this correspondence the doctor said that he felt he was unable to take care of Russian patients as well as of Latvians. The Latvian foreign minister fully agreed with the doctor’s statement. "I agree with your assessment and vision," the politician said.

Latvia’s famous journalist Lato Lapsa also exposed another passage from the same correspondence, in which the two men were discussing the ethnic question. Among the problems that Latvia, in his view, should urgently solve Slucis mentioned transfer of all instruction at Russian schools to the state Latvian language, "repatriation" of the Russian residents to Russia, as well as the return of the Pytalovo district of the Pskov region to Latvia.

Armenia is grateful to its Russian friends – Sargsyanhttp://news.az/articles/armenia/26429

Fri 12 November 2010 06:00 GMT | 7:0 Local Time

Stable Armenian-Russian strategic partnership is developing and inter-parliamentary cooperation plays key role in strengthening of bilateral ties, Armenian President Serzh Sargsyan said during meeting with delegates of Armenian-Russian inter-parliamentary cooperation committee.

Serzh Sargsyan received delegation headed by Nikolay Rizhkov, the Russian Co-Chairman of the Committee, and Armenian MP Aram Safaryan, RA Presidential press service informed.

President Sargsyan noted that Armenia is grateful to its Russian friends, among them Konstantin Zatulin, Vice-Chairman of the Committee for CIS and ties with Russian Nationals,  who was awarded by Armenian leader with a Medal of Honor for his major contribution to expansion of Armenian-Russian cooperation and strengthening of bilateral friendly ties.  

Nikolay Rizhkov spoke of work carried out as a result of decisions made at previous meetings of a committee. He also touched upon key issues on the agenda of Yerevan session. 

At a meeting with RA President Serzh Sargsyan, members of the Armenian-Russian Commission for Parliamentary Cooperation discussed the issue of ratifying protocols of prolonging the presence of the Russian military base in Gyumri, Konstantin Zatulin, Director of the Institute for CIS said.

He underlined the need for simultaneous ratification of the document by the Armenian and Russian Parliament.

“In the context of the present situation in the region, it is an important and urgent measure,” Zatulin said.

The document was signed during Russian President Dmitriy Medvedev’s visit to Armenia.

News.am

Moscow backs Azerbaijani electionshttp://www.news.az/articles/politics/26427

Fri 12 November 2010 06:25 GMT | 7:25 Local Time

Russia's Foreign Ministry supports the view of CIS election observers that Azerbaijan's parliamentary elections met democratic standards.

Spokesman Aleksey Sazonov commented on the polls at a regular briefing in Moscow yesterday.

"First of all, we would like to note the greater activity of citizens at polling stations, compared to the 2005 elections, the good level of organization of the elections, the professional work of the Azerbaijani Central Election Commission," Sazonov said, according to the Russian Foreign Ministry website.

"Voting took place in a peaceful situation, without the incidents that occurred at the last elections. All the registered political parties fielded candidates. There were more than 1,000 international observers at the elections. One of the largest missions, with some 350 people, was the CIS observation mission," Sazonov continued.

"The preliminary results of the elections showed growing support from the public for candidates from the New Azerbaijan Party, led by President Ilham Aliyev. One-third of the 125 deputies are new. The representation of the academic and creative intelligentsia, business and women in parliament has been reinforced.

"All this gave the basis for the CIS mission’s fair assessment of the elections as in line with Azerbaijani legislation and with democratic standards. There is not the slightest doubt about the legitimacy of the elections," the spokesman said.

This assessment differs from that of the larger observation mission led by the OSCE Office for Democratic Institutions and Human Rights.

Sazonov phrased it as: "However, the assessments of the elections by European structures, led by the OSCE Office for Democratic Institutions and Human Rights (ODIHR) contrasts somewhat with the conclusions of the CIS observers. The statement of the OSCE/ODIHR, OSCE Parliamentary Assembly and the European Parliament notes that ‘the conduct of these elections overall was not sufficient to constitute meaningful progress in the democratic development of the country’.

"This shows clear reluctance to note the work done by the Azerbaijani authorities to raise the quality of the electoral process."

The Russian spokesman said the differing assessments showed the need for agreed principles on monitoring within the OSCE.

"In this regard we fully support the initiative of the CIS observation mission coordinator, the deputy chairman of the Federation Council of the Russian Federation Federal Assembly, Sergey Orlov, on the need for single principles to be drawn up within the OSCE for the monitoring of the election process. We consider this an important element in the overall efforts to reform the OSCE," Sazonov said.

His remarks were echoed by the Russian Federation's permanent representative to the OSCE, Anvar Azimov, yesterday.

"Russia cannot agree with the estimates of individual states that are members of the Organization for Security and Cooperation in Europe (OSCE), which boil down to the fact that the 7 November parliamentary elections in Azerbaijan didn’t meet the requirements of international standards,“ Azimov told a meeting of the OSCE Permanent Council, according to ITAR-TASS.

"As you know, the OSCE has not yet worked out common rules for monitoring the electoral process. Before making such accusations, let’s return to working on this document on the principles of international observation and the status of international observers," he said.

News.Az

Interior Minister: 'More Russian Spy Networks Operate in Georgia'http://finchannel.com/Main_News/Politics/75367_Interior_Minister%3A_%27More_Russian_Spy_Networks_Operate_in_Georgia%27/

12/11/2010 10:12 (00:27 minutes ago) Civil.Ge -- Recently uncovered Russian military intelligence's (GRU) spy network is not the only one operating in Georgia and the Georgian counter-intelligence service is keeping a close eye on others too, Vano Merabishvili, Georgia's influential interior minister, said on November 11.

"There are at least three [Russian] secret services working in Georgia: GRU, FSB [Federal Security Service] and SVR [Foreign Intelligence Service - Sluzhba Vneshney Razvedki]," he said in an interview with the Georgian television station Imedi.

He said apart of recently exposed network, GRU still maintains other networks in Georgia, which "under our surveillance".

Imedi TV aired on Thursday evening portions from the interview, full version of which, the broadcaster said, will be shown on Saturday evening followed by live sit-down interview with Merabishvili in TV studio.

Merabishvili also said, that Russia's reaction to the recent spy row was far more moderate than in 2006, when Tbilisi arrested four Russian military officers on espionage charges. At the time Russia cut air, sea, land and railway links, as well as postal communication with Georgia and deported over 2,300 Georgians.

Merabishvili said that at the time Russia regarded Georgia as "kind of fourth grade country" and it was especially insulting for Russia when the country, which it deemed as "nothing", captured four of its spies.

Russia's reaction now was different, he said, because Russia "has gotten used to the fact" that Georgia is capable of uncovering its agents.

"Russia now had an adequate reaction... As I remember when the Russian spy network was uncovered recently in the United States, the Russian President's reaction to that was more aggressive than in case of Georgia," he said

"Believe me the next time we will expose thier agents, Russia may not have any reaction at all," Merabishvili said.

Moscow's immediate reaction to Georgia's announcement that it had arrested alleged spies, including four Russian citizens, was a statement by the Russian Foreign Ministry saying that Tbilisi 's "spy story" was "a provocation", aimed at attracting international attention ahead of NATO and OSCE summits. It also said: "The Saakashvili ’s regime suffers from chronic spy-mania on the anti-Russian grounds."

Wife and Son of Detained ‘Spy’ Lash Out at Tbilisi http://www.themoscowtimes.com/news/article/wife-and-son-of-detained-spy-lash-out-at-tbilisi/422519.html

12 November 2010By Nikolaus von Twickel

The relatives of a retired Russian police officer arrested on spying charges in Georgia accused Tbilisi authorities on Thursday of denying him a fair trial.

Yury Skrylnikov, 63, was sentenced in October by a court in Batumi to 18 years in prison on money-counterfeiting charges.

Afterward, the Georgian Interior Ministry accused him of being a liaison officer for a spy ring working for the General Staff's intelligence service, known as GRU.

The ministry last Friday paraded 13 members of the ring, whom it accused of gathering classified information about Georgia's armed forces.

Skrylnikov, who is from a village in the southern Stavropol region, is one of four Russian citizens among the group.

His wife and son said Thursday that Skrylnikov was "a simple Russian pensioner" who had traveled to Georgia to visit relatives.

"The accusations are all untrue and made up — and we do not know by whom," his wife, Lyubov Skrylnikova, told reporters.

She complained that relatives had been barred from visiting Skrylnikov since he was detained in May, just a day after entering Georgia on a shuttle bus from Russia.

"My father is guilty of nothing. He is very sick, has very poor eyesight and cannot see more than one meter," his son Ruslan told the same Moscow news conference.

He said his father was born near Batumi and served in the Georgian port city's police force until the Soviet collapse. After 1991, he worked as an investigator in the Stavropol police and retired with the rank of lieutenant colonel.

Repeated calls to the Georgian Interior and Foreign ministries went unanswered Thursday.

Deputy Foreign Minister Nino Kalandadze said earlier this week that Tbilisi was ready for talks with Moscow over the jailed Russians, but Foreign Minister Sergei Lavrov rejected this. "We won't negotiate. This is a provocation," he told reporters Wednesday, Interfax reported.

The Georgian Foreign Ministry confirmed late Wednesday that it had received a Russian request for more information on the suspects, Interfax reported, citing local media.

Andrei Soldatov, a security analyst who heads the Agentura.ru think tank, said Tbilisi was trying to gain political clout by suggesting direct talks with Moscow. "They want to appear to be on par, and that is precisely why Russia will not allow any negotiations," he said by telephone.

The two countries severed diplomatic ties after the short war over South Ossetia in 2008. Russian and Georgian authorities have claimed in the past to have uncovered spies for the other country, but the case involving Skrylnikov boasts the largest number of arrests.

Pretrial hearings on Russian pilot’s case begin in NYhttp://english.ruvr.ru/2010/11/12/33523952.html

Nov 12, 2010 09:53 Moscow Time

Pretrial hearings on the case of a Russian pilot Konstantin Yaroshenko, who has been facing drug trafficking charges in the U.S., are due to begin in New York today.

 Yaroshenko`s lawyer Anna Brown insists that her client should be released since the U.S has violated the norms of international law when abducted the pilot in Liberia in May and while collected evidence against him.

The pilot himself denies all the allegations. 

12 November 2010, 10:07

Dagestan's president performs Hajj http://www.interfax-religion.com/?act=news&div=7895

Makhachkala, November 12, Interfax - President of the Russian republic of Dagestan Magomedsalam Magomedov, who is currently on vacation, has arrived in Saudi Arabia to perform the Hajj.

"Upon arrival at Jidda airport, the Dagestani president set out for Mecca on the Hajj pilgrimage to holy Muslim shrines. He will visit the Masjid al-Haram mosque, Mount Arafat and the valley of Mina," a source in the presidential press service has told Interfax.

In October 2010, Magomedov received an invitation to the complete the Hajj as an honorary guest of the Saudi king.

Russian opposition to hold unsanctioned rally in downtown Moscow

http://en.rian.ru/russia/20101112/161297536.html

01:24 12/11/2010

Activists of a Russian opposition movement will gather in downtown Moscow on Friday for a "Day of Wrath" rally against recent attacks on a journalists and an environmental activist.

The Day of Wrath protests are traditionally aimed against the policies of Yuri Luzhkov, who had been mayor since 1992 and was recently sacked by the president over the "loss of confidence."

This time, the Left Front opposition movement is set to "show solidarity" with Kommersant journalist Oleg Kashin and environmental activist Konstantin Fetisov, a campaigner against the construction of a highway through the notorious Khimki Forest. Both men were taken to intensive care after brutal attacks.

"Participants will demand complete investigation into the attacks under direct control from the society and stern punishment for perpetrators and masterminds of the attacks," the organization said in a statement.

The Left Front has earlier rejected a venue suggested by the Moscow Government. The government's press office has already issued a warning for opposition activists, saying that the rally was not sanctioned by the authorities. Unauthorized rallies in Moscow usually result in mass detentions.

The Left Front activists would also put forward their traditional demands, which include greater powers for the capital's municipal authorities, early elections to the Moscow city legislature and thorough investigation into the previous mayor's policies.

According to police estimates some 50 people took part in the previous similar rally on October 12, which was covered by around 150 journalists. Over 30 people were detained.

MOSCOW, November 12 (RIA Novosti)

Russian protest over media attackshttp://www.euronews.net/2010/11/12/russian-protest-over-media-attacks/

12/11 07:38 CET

Hundreds of protesters gathered in Moscow’s Pushkin Square to denounce a spate of attacks on journalists.

They brandished banners saying “Stop the Terror” and “We are not afraid”. And many included a photo of the latest victim, Oleg Kashin, who has just come out of a five-day induced coma after an assault so savage it is being treated as attempted murder.

Rally organiser Anatoly Globa-Mikhailenko said: “It’s very good that the investigation is now under the special control [of Russian President Dimitry Medvedev] and that the president is not indifferent to what is going on in our country. But how can it help? This is the question.”

The New York-based Committee to Protect Journalists estimates there have been 19 unsolved murders of reporters since 2000, and ranks Russia as the eighth most dangerous country to work in.

Copyright © 2010 euronews

Chief auditor in Primorsky Ter detained when taking bribe

http://www.itar-tass.com/eng/level2.html?NewsID=15673754&PageNum=0

12.11.2010, 10.20

VLADIVOSTOK, November 12 (Itar-Tass) -- The chairman of the audit chamber at the Primorsky territorial legislature, Sergei Starovoitov, was detained on Friday when he took a 20,000-dollar bribe.

The Investigation Committee's territorial department confirmed the detention fact, declining for investigation secrecy reasons to give comments.

Forty-six-year-old Starovoitov, who worked for a long time at the territorial prosecutor's office, became head of the audit chamber at the Primorsky legislature in 2008. The chamber checks how territorial budget funds are used, conducts expert and analytical work to examine and prepare conclusions on budget projects and non-budget funds for a fiscal year and also examines and prepares conclusions on budget laws.

Senior aide of the head of the Investigation Committee's territorial department Avrora Rimskaya told Itar-Tass that Starovoitov was suspected of attempting to commit massive fraud.

He was detained red-handed when he received 20,000 dollars from a Vladivostok businessman.

The crime was detected in joint work of the Federal Security Service's regional department and the Investigation Committee, Rimskaya said.

A criminal case is opened against Starovoitov on charges of attempting to commit massive fraud, she said. The investigation continues. The official may be held in custody. It is under consideration now, she said.

Train with coal derails on Transsib, none hurt

http://www.itar-tass.com/eng/level2.html?NewsID=15673738&PageNum=0

12.11.2010, 09.31

IRKUTSK, November 12 (Itar-Tass) -- Twelve freight cars loaded with coal derailed on the Transsib main line in the Irkutsk Region on Friday morning.

The accident occurred near a railway junction at the section between the stations of Khingui and Khudoyelanskaya at 03:12 Moscow time, a source at the Russian Emergencies Ministry's Irkutsk regional department told Itar-Tass.

An emergencies ministry group promptly arrived there.

According to the updated information, three repair trains and a railway administration commission have arrived at the site.

Nobody was hurt in the accident.

According to the preliminary information cited by a source of the East Siberia railway administration, the derailment was caused by a defect of one of the cars.

Almost 40% of Russians drink to excess — experthttp://en.rian.ru/russia/20101112/161298537.html

04:25 12/11/2010

About 40% of Russians, or almost 57 million people, drink to excess, a Health Ministry top specialist told Rossiiskaya Gazeta on Friday.

Yevgeny Bryun said the number of registered alcohol addicts in the country is about 2%, or 2.7 million people.

"I mean the number of people, who are undergoing treatment," he said in an interview with the government daily. "But all kinds of problems, I mean economic, social and family troubles, come mainly from those who just drink to excess. They constitute about 30-40% of our population."

Alcohol consumption in Russia per capita is currently about 18 liters a year, twice the critical norm set by the World Health Organization. The Russian government has declared an anti-alcohol campaign and aims to halve consumption by 2020 and root out illegal production and sales.

Bryun also said that around one and a half million people are addicted to heroin in Russia, almost three times as much as the number of registered users.

"Some 530 drug addicts are registered, but the total figure stands at 1.5 million, according to our estimates," the official said.

Many experts believe the real figure to be as high as 2.5 million, accounting for almost 2% of the Russian population.

According to official statistics, around 30,000 people die in Russia every year from heroin, around 90% of it coming from Afghanistan.

Last year, a total of 825 people died from drug overdoses in Moscow alone, almost twice as many as in 2008.

MOSCOW, November 12 (RIA Novosti)

Sections of 2 ring roads in Moscow to be over before yearend

http://www.itar-tass.com/eng/level2.html?NewsID=15673719&PageNum=0

12.11.2010, 00.27

MOSCOW, November 12 (Itar-Tass) - Construction of a number of sections of the 3rd and 4th Automobile Ring Roads in Moscow will be over before the end of 2010, officials at the city's construction industry told Itar-Tass Thursday.

"We plan putting into operation a number of large sections of the roads and several pedestrian passes," an official said.

One of the important elements in the city's infrastructure to be commissioned before the yearend is an interchange at the crossing of the 3rd automobile ring and Krasnopresnensky Prospekt Avenue not far from the Moskva City business center.

Also close to the business center, a section of the 3rd Ring will be built between Zvenigorodskoye Shosse and Begovaya Street.

Some of the new pedestrian underpasses will be equipped with lifts to suit people with physical motion impairments.

As for the 4th Automobile Ring Road, the preparatory phase of construction will be finished at a section linking two large eastern districts of the city.

“Commissioning of these facilities will improve the road situation in the city,” the official said.

Russian Press at a Glance, Friday, November 12, 2010http://en.rian.ru/papers/20101112/161299853.html

08:33 12/11/2010© RIA Novosti. Rybchinskiy

POLITICS

President Dmitry Medvedev will hold an online question-and-answer session with the public on November 16 in what analysts called a show of his commitment to modernization and his wish to run for president in 2012, the Moscow Times said. Meanwhile, Nezavisimaya Gazeta says the president’s address to Russia’s bicameral legislature, the Federal Assembly, tentatively planned for November 17, may be delayed until November 22(The Moscow Times, Nezavisimaya Gazeta)

Only three parties - pro-Kremlin United Russia and A Just Russia parties, as well as the Communists - would manage to clear the seven-percent threshold in the December 2011 parliamentary elections, according to the All-Russia Center for the Study of Public Opinion (VTsIOM)(Komersant, Vedomosti)

EX-SOVIET STATES

This year’s presidential elections in Belarus may set the country’s record for the number of candidates. At least ten potential candidates managed to gather 100,000 signatures in their support required for registration. The final announcement is expected in late November. Meanwhile, opposition leader Vladimir Neklyaev, widely seen as incumbent president Alexander Lukashenko’s main rival, may be denied registration as his political movement was closed on Thursday.(Vremya Novostei, Kommersant)

METALS & MINING

Russian natural resources ministry seeks to speed up prospecting natural resources in Russia. One possible variant is to let companies choose areas for prospecting and allow several companies to prospect minerals in the same area(Vedomosti)

TELECOMS & IT

The body overseeing the Cyrillic Internet domain said 184,352 addresses were registered as registration was opened to the general public on Thursday. More than 36,000 domain names were registered in the first hour alone, the Coordination Center for the National

Internet Domain said on its website (The Moscow Times)

BANKING & FINANCE

G20 leaders have little chance to agree on currency issues during the summit in Seoul, but it plays no major role for Russia, Deputy Prime Minister Alexei Kudrin said(Vedomosti)

CONSUMER

Russian Standard, a major Russian vodka producer, has agreed to buy one of Ukraine’s largest alcohol producers Nemiroff (Vedomosti)

RELIGIONThe Russian Orthodox Church is set to boost its missionary work, citing the necessity to conduct “the second Christianization” of Russians(Vremya Novostei)

CRIME

Police disclosed the names of four suspects detained in connection with the terrifying mass murder of 12 people in South Russia. The suspects, aged 17 to 23, possibly killed eight adults and four minors in order to be accepted into a local gang(Vremya Novostei, Kommersant, Rossiiskaya Gazeta)

The Investigative Committee reopened a criminal case into the 2008 attack on journalist Mikhail Beketov, who lost his leg and the ability to speak in the attack.(The Moscow Times, Kommersant, Rossiiskaya Gazeta)

Fradkov Under Fire for Spy Defection http://www.themoscowtimes.com/news/article/fradkov-under-fire-for-spy-defection/422520.html

12 November 2010By Alexander Bratersky

State Duma deputies demanded the ouster of spymaster Mikhail Fradkov on Thursday for failing to expose a double agent in his Foreign Intelligence Service who purportedly betrayed 11 Russian agents to the United States in June.

Kommersant, which broke the story Thursday, said the intelligence officer, a Colonel Shcherbakov, had fled to the United States three days before President Dmitry Medvedev met with U.S. President Barack Obama in Washington on June 24.

U.S. authorities arrested 10 Russian sleeper agents three days later, on June 27, while an 11th suspect disappeared in Cyprus.

Shcherbakov headed a department at the Foreign Intelligence Service, or SVR, that worked with U.S.-based illegals — deepcover agents who lived as ordinary people — and handed over the personal file of the FBI's biggest catch, Mikhail Vasenkov, known as Juan Lazaro, to his U.S. intelligence handlers, Kommersant said, citing unidentified Russian intelligence officials.

“This is not just a betrayal. To bring an illegal's personal file to the enemies is [expletive]. Things like this never happen,” the newspaper quoted an intelligence officer as saying.

Prime Minister Vladimir Putin, who headed the Federal Security Service in the late 1990s, has said the Russian spies were bretrayed and he knows who is responsible.

"Traitors always end badly. As a rule, they end up in the gutter as drunks or drug addicts,” he told reporters on July 24.

Communist and A Just Russia deputies in the Duma seized upon the Kommersant report Thursday to demand Fradkov's dismissal.

“The service is headed by a man who has nothing to do with it, and the word 'trade' is repeated on his resume several times,” senior Communist Deputy Ivan Melnikov said in a statement. He was referring to Fradkov's background as a Soviet trade official.

Gennady Gudkov, deputy head of the Duma's Security Committee and a member of A Just Russia, called for the creation of a Duma commission to investigate the damage caused by Shcherbakov's betrayal.

Fradkov, a former prime minister whom Putin appointed as the SVR's chief in 2007, played a key role in negotiations that led to the July 9 spy swap in which the United States handed over the 10 Russian illegals in exchange for four Russians convicted of spying.

Just a day after the illegals were arrested, the CIA contacted the SVR to float the idea of the exchange, paving the way for three phone calls between CIA Director Leon Panetta and Fradkov, U.S. media reported in July, citing unidentified U.S. officials.

The exposure of a double agent within the SVR could bode badly for Fradkov. Kommersant said the development puts his leadership in doubt and speculated that he might be replaced by Kremlin chief of staff Sergei Naryshkin.

An SVR spokesman, contacted by telephone, declined to comment on the Kommersant report Thursday.

A former senior intelligence officer said in an interview that he suspected a campaign was under way to replace Fradkov and the Kommersant report was only a pretext.

“If these rumors have started circulating, and knowing Fradkov's business skills, I think there are grounds to fire him," the former officer said, asking for anonymity because of the sensitivity of the matter. "Betrayal is just a pretext."

Only President Dmitry Medvedev has the authority to dismiss Fradkov.

But Fradkov is unlikely to be dismissed before the end of the year because the SVR will celebrate its 90th anniversary on Dec. 20, said Igor Korotchenko, editor-in-chief of National Security, a journal about the intelligence community. “But after the celebrations are over, the search for scapegoats will begin,” Korotchenko said.

Kommersant shed more light on Vlasenkov, who, it said, held the rank of general and was awarded the Hero of the Soviet Union medal for his work in the United States in the 1980s. Vlasenkov's true identity apparently even surprised his longtime wife, Vicky Pelaez, a left-wing Peruvian journalist.

Shcherbakov drew suspicions at the SVR some time before his disappearance in June, at one point turning down a promotion that would have required him to take a lie detector test, Kommersant said, citing intelligence sources.

He has a daughter who has lived in the United States for some time, and his son, who worked at the Federal Drug Control Service, left Russia in June, the report said.

A spokesman for the Federal Drug Control Service said Thursday that the agency had no record of a Shcherbakov related to an SVR official among its staff, Interfax reported.

Several analysts said they saw possible problems in the Kommersant account. For one, the report says Vlasenkov managed to obtain a schedule of Obama's foreign visits for the year ahead, a document that Andrei Soldatov, head of the Agentura.ru research center, declared had little intelligence value.

The report also says FBI investigators tortured Vasenkov during questioning, breaking a leg and three ribs.

“While the FBI like any intelligence agency can pressure people psychologically, it is not the gestapo,” Korotchenko said.

Kommersant said the Shcherbakov scandal might lead the SVR to be put under the Federal Security Service, an idea previously proposed by former FSB head Nikolai Patrushev, who heads the Security Council.

During Soviet times, the KGB had both the domestic counterintelligence and foreign intelligence directorates under its wing. Foreign intelligence became a separate agency during Boris Yeltsin's presidency.

But Soldatov expressed doubt that such a merger was possible, noting that the FSB was now building its own foreign intelligence arm.

The former intelligence officer said any merger would be “dangerous.”

“This would be a path toward dictatorship,” he said.

November 11, 2010The Spy Who Loves Them

http://www.russiaprofile.org/page.php?pageid=International&articleid=a1289495477

By Tai AdelajaRussia Profile

Discovering the Mole Who Betrayed Russian Undercover Agents in the United States Won’t Lead to Fundamental Reforms in Russia’s Security Services, Experts Say

The Russian Foreign Intelligence Service (SVR) is reportedly reeling from an excruciating “stab in the back,” after revelations that the eleven Russian sleeper spies sent packing from the United States in late June were betrayed by one of their own. Colonel Shcherbakov of SVR's ''C'' department, whose job was to plant agents in the United States, has been identified by an SVR source as the mole who betrayed the Russian spies, the Kommersant business daily reported on Thursday.

In what was the biggest U.S.-Russian spy scandal since the end of the Cold War, ten Russian sleeper agents were arrested and sent back home in June, in the biggest spy swap since the Cold War, while an additional Russian spy escaped before he was arrested. The unidentified SVR source told Kommersant that the scandal could lead to a big shake-up in Russia’s Foreign Intelligence Service, as many in the agency admitted that the problem was the result of serious oversight by intelligence officers.

The SVR admitted it overlooked the fact that Shcherbakov’s daughter had been living in the United States for ten years, a fact which would have automatically disqualified him for the position he held. The agency also failed to pay due attention to the fact that Shcherbakov’s son, who worked for the Federal Drug Control Service, had hastily left Russia for the United States shortly before the eleven Russian sleeper agents were exposed. Shcherbakov himself fled Russia three days prior to President Dmitry Medvedev's visit to the United States in June. “After that, the Americans, suspecting that

the Russians could start smuggling their agents out of the United States, started to round them up,” the paper quoted the SVR source as saying.

The intelligence services also admitted it failed to raise the alarm when Shcherbakov refused to accept a promotion last year as it would have required him to undergo a lie detector test. This could only mean that he had been cooperating with the U.S. secret services at the time, the source said. Former SVR colleagues were irked by Shcherbakov’s betrayal, the paper wrote, in particular by his role in exposing 65-year-old Michael Vasenkov, also known as Juan Lazaro, whom the paper called “the most valuable and experienced out of the ten Russian sleeper spies.” The paper source said U.S. intelligence agencies tried unsuccessfully to prove Vasenkov's connection with other detained Russian sleeper spies until Shcherbakov visited him in prison and goaded him into confessing. Failing to elicit a confession, Colonel Shcherbakov proceeded to hand over Vasenkov's personal files to the Americans, which they used to pressure him into confessing, the SVR source said.

The unnamed source also claimed that American investigators had tortured Vasenkov, breaking three ribs and a leg in the process. A retired SVR officer interviewed by Russia Profile found the claims credible, and compared this to the methods used in Iraqi prisons, saying they were just another sign of lowering the bar in modern-day spy games. “These are Iraqi methods,” the officer said. “What comes to mind are the videos we saw from Iraqi prisons. They could not outplay him honestly and resorted to impermissible foul play. Yes, they probably always do that in American football, but this is not American football.”

According to Kommersant, Russian Prime Minister Vladimir Putin, who later met the expelled Russian spies, must have known the name of the traitor when he expressed disgust at his actions in June. "This is the result of betrayal and traitors always end up badly. They end up, as a rule, under the fence while on booze or drugs," Putin said when the scandal broke in June.

Kommersant also quotes an unidentified Kremlin official as suggesting that a Russian hit squad was already planning to kill the colonel. "We know who he is and where he is. Whether he betrayed for money or was simply caught up in a situation, make no mistake – Mercader has already been sent to get him," a senior Kremlin aide told the paper, in obvious reference to Ramon Mercader, the Soviet secret agent believed to have killed Leon Trotsky with an ice pick. The Kremlin source said Shcherbakov would spend the rest of his life fearing retribution.

Gennady Gudkov, the deputy head of the Russian Parliament's Security Committee, said Thursday that a special parliamentary investigation may be launched into the state of affairs in the SVR. He said the case exemplifies the “moral degradation of the state's elite who collected their fortune by using their official positions.” “The treason undermined both Russia’s intelligence image and its future,” Gudkov said. The SVR source told Kommersant that a far-reaching investigation into all Russia’s power structures has been

launched, as suspicions linger that many former and current employees of the SVR could be implicated in the case.

The revelation “is bad news for the Russian espionage community,” the retired senior officer of Soviet and Russian foreign intelligence told Russia Profile on Thursday. “It means that things are really bad with the internal security at Yasenevo,” he said in reference to an area where the headquarters of the Russian Foreign Intelligence Service are located, just outside of Moscow. “They are probably keeping themselves busy with the wrong kind of things.” Having someone like Shcherbakov as the traitor is in fact worse than KGB defector Sergei Tretyakov, because he was a mole at the very core of Russian undercover operations in the United States, the officer said.

Tretyakov was a former agent under the cover of a Russian UN official, who defected to the United States ten years ago and was once widely believed to have betrayed the agents. He died suddenly around the time the Russian spy network was uncovered last summer. “Shcherbakov may also choke one day,” said the officer. In a June 29 interview with Russia Profile, the retired officer correctly predicted that there must have been a mole in the headquarters behind the arrest of ten undercover agents. “If one deep undercover agent gets arrested, it's a failure, if 11 deep undercover agents get arrested, it's a betrayal here, at the Center,” he said back then.

Andrei Soldatov, the founder of investigative Web site Agentura.ru, which monitors the secret services, said Shcherbakov's defection "is not a big deal" and was unlikely to trigger fundamental changes in the structure of the Russian Foreign Intelligence Service. "This is something that happens from time to time within the intelligence services,” Soldatov said. “Both Sergei Tretyakov and former colonel Alexander Zaporozhsky slipped away under the SVR's nose without ever being detected as double agents.” Soldatov said the special services are long overdue for reforms because unlike the FSB the SVR has never been reformed in the past 20 years, except for a brief period in the 1990s when former Prime Minister Yevgeny Primakov renamed the agency. “However, despite the clamoring for change, the present scandal will hardly lead to an overhaul of the services,” Soldatov said.

Russia's Steve Jobs

http://www.businessneweurope.eu/storyf2399/Russias_Steve_Jobs

Mike Collier in Riga November 12, 2010

Russian companies may offer some of the best opportunities in the world for investors, but even the most ardent Russophile would have to admit they sometimes suffer from an image problem. Words like "giant," "monopoly," "state sponsored" and "secretive" get

bandied about in the western media so carelessly that it's easy to fall into the trap of thinking that entrepreneurship and excellence have had nothing to do with Russia's economic renaissance. Providing an antidote to such poison are companies like Kaspersky Lab that provide a timely reminder Russia owes just as much to its brainpower as it does to its wealth of resources.

Like many great Russian success stories (Faberge, Kalashnikov, Tupolev), Kaspersky bears the name of a single individual: Eugene Kaspersky, who founded the company 13 years ago and is still its chief executive. Or rather, it bears the name of two individuals, as a good deal of the company's success is also due to co-founder and chairman Natalya Kaspersky.

Over 300m people worldwide are protected by Kaspersky Lab products, and the corporate client-base exceeds 200,000 companies. Product activations currently number over 10m per month and in 2009 the company claimed unaudited revenues of $391m (up 42% on year). In the words of Latvian-American IT journalist Juris Kaza, Kaspersky is effectively "Russia's Steve Jobs" and the company he founded could be described as "a Silicon Valley company that just happens to be located in Russia."

Localability

At the opening of its new office for the Baltic states in Riga recently, the audience of puzzled journalists and leading geeks were given quick evidence that IT excellence can originate just as well from Siberia as it can from California (Kaspersky's three research offices are in St Petersburg, Moscow and Novosibirsk).

All too often, Baltic press conferences consist of a dour drone in a poorly-lit boardroom, accompanied by an A4 press release and couple of curling sandwiches if you are lucky. In contrast, Kaspersky took over the best hotel in town, presented attendees with mock "virus protection" passports, press packs on flash disks and – gasp! - a free copy of their bestselling product, Kaspersky Anti-Virus. The company then rounded the event off with a three-course lunch, and all to mark the opening of an office that will likely have a staff of one for the foreseeable future.

But more impressive even than the poached salmon was the way Kaspersky's young team, led by Gary Kondakov, director of operations in Eastern Europe, Asia and Africa, fielded questions in three languages while displaying levels of product and market knowledge that had even the spottiest geeks nodding their approval. With his soft accent and diamond ear stud, Kondakov is about as far from the clichéd picture of the dour Russian board member as it is possible to imagine. "If we fulfill our plans, we will be number three globally at the beginning of next year – but we are speaking about a very specific part of the market, corporate security content management, not the whole information security market," he told the assembled journalists.

According to Kondakov, much of Kaspersky's success lies in its approachability and positive brand image. "Probably we are the only company in our field who can say that

our partners are part of our community. Partners have very specific relationships in terms of being one family. We have huge and often humorous events for our partners, conferences in different parts of the world and lots of other initiatives."

"When we open an office in Johannesburg, our people also go to Botswana, Namibia and other countries in the area. Our competitors would probably consider these to be small markets, but believe me there is business there as well. We pay lots of attention to 'localability' as we call it within the company," he said.

In contrast, Kaspersky's "Russianess" is increasingly irrelevant. "Probably very few people know that it is a Russian company," Kondakov said. "85% of our business is outside Russia. Two years ago when we opened our office in Dubai, a journalist asked Eugene Kaspersky what made his company different. Eugene answered him this way: 'Do you know who is Mr Syamantic or Mr BitDefender? Nobody knows them. But Kaspersky is me and I am here in front of you'."

Perhaps surprisingly, the global economic crisis has proven that security is one of the last things to get cut when companies are looking to save money. "Even if you are down to your last $100, you will pay for security because in our web world it means everything. The price of information in your computer is much higher than what you pay to defend it," Kondakov said.

But as well as trumpeting Kaspersky's arrival, its management team came to Riga with a warning. A new IT security threat called "Stuxnet" has the potential to cause far greater damage than anything seen so far. According to some theories, it was developed by Israel to cripple Iran's nuclear programme, but has now gone rogue. "It's like when the street gangs of Los Angeles stopped using knives, clubs and home-made guns and suddenly would get a fully-equipped Uzi or military grade M-16. That changes the game," says the IT journalist Kaza.

Luckily the Russians are on hand to protect us. "Clearly we are among the good guys," smiled Kondakov.

Tracing the Rise of 'The New Nobility' http://www.themoscowtimes.com/arts_n_ideas/article/tracing-the-rise-of-the-new-nobility/422527.html

12 November 2010By Carl Schreck

Since the ascent of Vladimir Putin a decade ago, many hands have been wrung down to the bone in the West over his KGB pedigree and the array of spooks that have joined Russia’s ruling class under his watch. For some excitable critics of the current government, the mere fact of Putin’s service to one of the more ruthless security agencies

in modern history is indisputable evidence of his sinister nature and unwavering commitment to restoring a totalitarian state and a menacing security apparatus to safeguard it. The KGB is evil; Putin is KGB; ergo Putin is evil. So goes the supposition.

Fortunately there are inquisitive and intrepid journalists like Andrei Soldatov and Irina Borogan to bring nuance, analysis and old-fashioned shoe-leather reporting to the subject of the revival of Russia’s security services. In their new book “The New Nobility,” Soldatov and Borogan — co-founders of the Agentura.ru web site — provide a sober look at the increasing influence of the KGB’s main successor, the Federal Security Service, or FSB, on the country’s affairs under Putin.

Relying primarily on first-hand reporting they did for a variety of publications — including the influential opposition biweekly Novaya Gazeta — the authors pull no punches in their criticism of endemic corruption and incompetence in the country’s security forces. But they do so with a refreshing lack of hysteria, drawing conclusions from facts they were able to document and refusing to indulge in conspiracy theory.

The book draws its title from a description of his subordinates given by erstwhile FSB chief Nikolai Patrushev in a 2000 newspaper interview. The agencies ranks include “highbrow intellectual analysts,” “broad-shouldered, weather-beaten special forces men,” “taciturn explosives specialists,” and “discreet counter-espionage” officers, Patrushev beamed. “They all look different, but there is one very special characteristic that unites all these people … : It is their sense of service.”

Patrushev’s ebullience was understandable. Russia’s security services had been largely castrated in the 1990s by Boris Yeltsin, who divvied up the former KGB into various agencies in order to play them against one another. In Putin, they now had one of their own running the country. And over the next decade, the authors note, Putin brought much of the former KGB under the auspices of Patrushev’s agency, while “former and current security service agents permeated the ranks of business and government structures.”

Along with their new status, of course, came spoils — including expensive real estate on the prestigious Rublyovo-Uspenskoye Shosse in western Moscow. In contrast to Soviet times, when the KGB merely loaned these properties to its officers, this land — some of the most expensive in Russia — has been handed over to FSB officials for a song.

In one of the book’s more entertaining sections, the authors investigate this naked land-grab and the futile attempts of independent State Duma deputy Viktor Alksnis to challenge such deals, which had outraged his constituents in the area. When the authors pressed authorities for an explanation, they were told the land was doled out under a law meant to provide modest housing to security service veterans. Alksnis’ voters weren’t the only ones incensed, apparently. In a hilarious twist, Soldatov and Borogan discover that several FSB officers had appealed to the European Court of Human Rights in Strasbourg with claims of discrimination over their bosses’ access to such perks.

If you live in Russia — or follow its politics — long enough, you learn to shake your head and chuckle at such hijinks. And Soldatov and Borogan delve into plenty of similar light fare associated with the security services’ growing power in the Putin era — including the infamous 2006 “spy rock” scandal involving British diplomats in Moscow and the bizarre tale of Alexander Novikov, who claimed that he was an FSB plant in Garry Kasparov’s opposition group and subsequently sought political asylum in Denmark. But the authors tackle the serious as well, most notably in several chapters devoted to Russia’s response to the terrorist attacks, organized by Chechen rebels, on the Dubrovka theater in 2002 and School No. 1 in Beslan in 2004.

Soldatov and Borogan reported from the ground during both of these horrifying attacks, and their accounts in this book are as gripping as they are incisive — conveying the tension and chaos as security forces attempt to free hundreds of hostages. In the Dubrovka crisis, Russia’s “frightening lack of preparedness for a grave hostage situation” led to more than 100 deaths, largely because medical personnel had not been properly mobilized to handle the aftermath, they conclude.

In Beslan, shoddy organization proved deadly as well, with no visible chain of command controlling the operation to free the parents, teachers and children held in the school by terrorists. About an hour after the gunfire started, the authors saw Eduard Kokoity, president of the breakaway republic of South Ossetia, giving orders to Russian troops. “He was the president of another country, but he was one of the people making decisions,” they write. No senior officials were punished for either debacle. Indeed, many received medals or promotions.

To be sure, “The New Nobility” has its flaws. There are stabs at broad conclusions that seem rushed and included only as afterthoughts, and in spots the authors jump from subject to subject with little sense of a narrative thread — like following a chapter about FSB propaganda with a section about secret KGB tunnels under the streets of Moscow. But the sheer volume of original reporting on Russia’s security service — which has landed both Soldatov and Borogan in criminal probes by the FSB — is remarkable.

Those seeking anti-Kremlin diatribes or a categorical denunciation of the country’s increasingly powerful security services will be disappointed by this book. If there is one overarching theme, it is not that the FSB is an inherently insidious entity. It is that in a healthy society, an organization entrusted with so much authority over the public’s well-being must be accountable in some way to the public itself.

Next Cold War heated with natural gas?http://www.upi.com/Top_News/Special/2010/11/11/Next-Cold-War-heated-with-natural-gas/UPI-28561289507886/

Published: Nov. 11, 2010 at 3:38 PMBy STEFAN NICOLA, UPI Europe Correspondent

BERLIN, Nov. 11 (UPI) -- Russia launched the South Stream pipeline not for energy reasons but to pull Ukraine eastward, a strategy that could spark a Cold War-like conflict between Europe and Russia, former German Foreign Minister Joschka Fischer has warned.

"South Stream is a project directed against Europe and especially Ukraine. It's used to pressure Ukraine into Russia's direction -- first economically and then politically," Fischer said Wednesday at the European Autumn Gas Conference in Berlin. Such a move, he added, would "completely change the geopolitical situation" between the European Union and Russia.

Fischer's strong language is a sign that the battle of the pipelines is in full swing. He's an adviser to Nabucco, a European pipeline project intended to reduce Europe's dependency on energy imports and a direct competitor to South Stream.

Backed by Germany's RWE and OMV from Austria, Nabucco would transport Caspian and Middle Eastern gas to Western Europe, bypassing Russia. Consortium members are currently in talks to secure gas from northern Iraq, Azerbaijan and Turkmenistan.

The Kremlin as a response launched South Stream, which is now vying for similar supplies and customers than Nabucco. Ever since a row over gas prices with Ukraine in 2006, the Kremlin has been accused of using its energy reserves as a political pressure tool.

Ukraine has flirted with NATO membership and aims to join the European Union, a westward course Russia is eager to delay or stop altogether, observers say. Kiev needs transit fees from Russia to consolidate its budget, so South Stream, which has the potential to reroute much of the Russian gas sent through the Ukraine, could do severe damage to Ukraine's economy.

People close to Nabucco have also said Russia that is pressuring potential Nabucco suppliers in Central Asia -- Russia's traditional sphere of influence -- into committing to South Stream.

In the battle of the pipelines, this could spell the defeat of Nabucco, as experts have warned that there is room for only one of the two projects.

Fischer, Germany's foreign minister from 1998 until 2005, said the choice is clear.

Nabucco could establish transit country Turkey as a "second energy hub for Europe," bind Central Asia to the West and help stabilize Iraq, he said. It might even convince Iran, which sits atop vast gas supplies, to "change its mind politically" to join the project, he added.

Marcel Kramer, South Stream's new chief executive officer, said at the same conference in Berlin that his pipeline wasn't about geopolitics but about supply and demand.

"Our pipeline makes economic sense," Kramer said in a discussion with Fischer, arguing that companies such as Italy's Eni wouldn't invest in South Stream just to further Russia's interests. "We simply want to get gas from A to B."

Fischer contested Kramer's pledge that South Stream, led by Russia's state-controlled energy giant Gazprom, could be built for no more than $14 billion.

"I heard rumors that Eni has a feasibility study which is talking about $40 billion," Fischer said, adding that South Stream will have trouble getting financing.

Kramer's reply came immediately.

"Let's agree to disagree," he told Fischer, "and see what the bankers have to say."

National Economic Trends

11/12 10:05   CORRECTED: RUSSIAN MONETARY BASE UP TO 5302.0 BLN RUBLES IN A WEEK TO NOVEMBER 8 - CB 11/12 10:03   DOLLAR RISES 17 KOPECKS TO 30.75 RUBLES; RUBLE SLIGHTLY LOWER AGAINST CURRENCY BASKET 11/12 10:03   RTS INDEX DOWN 0.6% TO 1,620.11 PTS AT OPEN ON FRIDAYhttp://www.interfax.com/

Russian Share Sales to Reach Four-Year High in 2011, VTB Says http://noir.bloomberg.com/apps/news?pid=newsarchive&sid=a7GUrrJSTlcE

By Jason Corcoran and Zijing Wu

Nov. 12 (Bloomberg) -- Russian share sales may jump to $28 billion next year, the most since 2007, after the country’s benchmark index regained the bulk of its record decline, said VTB Capital, the nation’s biggest equity underwriter.

Initial public offerings mainly in the mining, chemicals and retail industries will probably total $20 billion in 2011, while the state privatization program may raise another $7 billion to $8 billion, said Elena Khisamova, head of equity markets at VTB Capital.

Any Russian listing of “significant” size will succeed, said Khisamova, 32, who oversees IPOs at the investment arm of Russia’s second-largest lender. “An IPO of $1 billion provides reasonable liquidity but an IPO of $3 billion to $4 billion elevates the deal to a completely new level,” Khisamova said in an interview in Moscow. “The free float has to be sufficient to attract investors.”

State-run VTB Capital overtook Renaissance Capital as the country’s biggest underwriter with a 12.3 percent share of this year’s stock sales, after helping organize the $1 billion offering by Facebook Inc. investor Mail.ru Group Ltd. on Nov. 5, according to data compiled by Bloomberg. RenCap has helped manage 12 percent, the data show.

The Micex Index of 30 Russian stocks has tripled from an almost four-year low of 513.62 on Oct. 24, 2008, to a two-year high of 1,617.33 yesterday, helping fuel this year’s fivefold increase in share sales.

‘Healthier Market’

Russian equity sales have climbed to $6.3 billion from $1.2 billion in 2009, Bloomberg data show. Russian companies sold $36 billion of shares in 2007, when they accounted for about one- third of all IPOS on the London Stock Exchange, according to Morgan Stanley.

“It’s a healthier market now,” said Aukse Jurkute, London-based head of equity capital markets for Russia and other former Soviet republics at Bank of America Merrill Lynch. “Investor interest in clearly greater” than six months ago, Jurkute said by phone.

Alisher Usmanov, the billionaire shareholder of London’s Arsenal soccer club, and his partners in Moscow-based OAO Metalloinvest plan to raise as much as $4 billion selling 20 percent of the country’s largest iron-ore producer in the first half of the year, according to two people familiar with the matter who declined to be identified because talks are private.

SUEK, Alrosa

OAO Siberian Coal Energy Co., or SUEK, Russia’s largest producer of coal for power stations, may raise as much as $3 billion, while diamond monopoly ZAO Alrosa may seek $2.5 billion, according to people familiar with the matter.

The government last month chose 10 banks to manage what it expects will be at least $59 billion in asset sales over the next five years, including stakes in railroad monopoly OAO Russian Railways, oil producer OAO Rosneft, airline OAO Aeroflot, long-distance phone monopoly OAO Rostelecom and shipper OAO Sovcomflot.

Investors are focused on “high-growth stories” such as Mail.ru, which calls itself the largest Internet services provider to the world’s more than 250 million Russian speakers, Bank of America’s Jurkute said. Mail.ru surged as much as 41 percent on its first day of trading on Nov. 5 and closed yesterday at $36.50, or 32 percent above its $27.70 IPO price.

BRICs

Still, investors remain concerned about corporate governance and risk management at Russian companies, as well as “the poor track record of Russian IPOs,” VTB’s Khisamova said.

Three companies that held IPOs in the first half, fishing company OAO Russian Sea Group, drugs wholesaler OAO Protek and coal producer OAO Kuzbass Fuel Co., have all lost market value since their offerings. Three others, fertilizer maker OAO UralChem, sugar producer OAO RusAgro and Deripska’s Strikeforce Mining & Resources Plc, postponed their IPOs in the same period, citing “market volatility.”

Russian stocks are the cheapest of the four co-called BRIC nations, with a price-to-earnings ratio 9, versus about 14 for Brazil and 20 each for China and India, according Bloomberg data. Just nine Russian companies have held IPOs this year, compared with 386 for China, 61 for India and 12 for Brazil, Bloomberg data dhow.

United Co. Rusal, the aluminum maker headed by billionaire Oleg Deripaska, fell as much as 38 percent after its $2.2 billion IPO in Hong Kong in January, the biggest by a Russian company this year and the first in China. The stock has since rebounded, closing yesterday at HK$10.50, still 2.8 percent less than its IPO price.

In addition to Mail.ru’s offering this month, O’Key Group SA, Russia’s third-largest food retailer, raised $420 million on Nov. 2, followed by builder OAO Mostotrest’s $388 million sale the next day and Russia Railways unit OAO TransContainer’s $400 million offering on Nov. 9.

In this month’s offering “books were covered, big companies managed to place significant amounts of money and the sales attracted over $2 billion,” said Michael Kart, a managing partner at Moscow-based investment firm Marshall Spectrum Ltd. “That’s a vote of confidence in risk appetite for Russia.”

-- With assistance from Ilya Khrennikov in Moscow. Editors: Brad Cook, Stephen Kirkland.

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

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

Last Updated: November 12, 2010 02:28 EST

Bofa Cuts Russian 2010 GDP Growth Outlook, Raises 2011 Forecast http://noir.bloomberg.com/apps/news?pid=newsarchive&sid=aNSOcF7v4Xpk

By Paul Abelsky

Nov. 12 (Bloomberg) -- Russian gross domestic product will probably expand 4 percent this year, less than a previously estimated 4.5 percent, after a record drought damaged crops and investment remained “subdued,” Bank of America Merrill Lynch analysts said today in a report.

The bank raised its estimate for Russia’s 2011 economic growth to 4.5 percent from a current 4 percent forecast.

To contact the reporter on this story: Paul Abelsky in Moscow at pabelsky@bloomberg.net

To contact the editor responsible for this story: Torrey Clark at tclark8@bloomberg.net

Last Updated: November 12, 2010 01:33 EST

TABLE-Russia monetary base rises to 5.30 trln rblshttp://in.reuters.com/article/idINLDE6AB0B120101112

1:05pm IST MOSCOW, Nov 12 (Reuters) - Russia's monetary base rose to 5.30 trillion roubles ($173 billion) on Nov. 8 from 5.22 trillion roubles a week earlier, the central bank said onFriday. It provided the following details. Date Monetary base (bln roubles) 2010 Nov 8 5,302.0 Nov 1 5,220.6 Oct 25 5,290.2 Oct 18 5,280.4 Oct 11 5,226.7 Oct 4 5,163.3 Sept 27 5,214.9 Sept 20 5,235.8 Sept 13 5,174.3 Sept 6 5,132.0 Aug 30 5,147.1 Aug 23 5,190.0 Aug 16 5,165.1 Aug 9 5,101.8 Aug 2 5,065.6 July 26 5,133.1 July 19 5,134.4 July 12 5,075.3 July 5 4,996.6 June 28 5,005.6 June 21 5,032.4 June 15 4,985.0 June 7 4,883.2

May 31 4,861.2 May 24 4,890.0 May 17 4,842.6 May 11 4,801.9 May 4 4,760.9 April 26 4,746.2 April 19 4,728.4 April 12 4,642.9 April 5 4,566.7 March 29 4,581.8 March 22 4,617.4 March 15 4,578.4 March 9 4,553.8 March 1 4,479.5 Feb 24 4,563.2 Feb 15 4,483.4 Feb 8 4,420.0 Feb 1 4,403.1 Jan 25 4,479.2 Jan 18 4,482.5 Jan 11 4,716.0 Jan 1 4,716.0 2009 Dec 28 4,487.6 Dec 21 4,353.0 Dec 14 4,246.4 Dec 7 4,154.7 Nov 30 4,103.5 Nov 23 4,157.7 Nov 16 4,133.8 Nov 9 4,081.3 Nov 2 4,049.7 Oct 26 4,101.6 Oct 19 4,095.9 Oct 12 4,047.0 Oct 5 3,988.3 Sept 28 4,026.8 Sept 21 4,055.4 Sept 14 4,039.3 Sept 7 3,990.9 Aug 31 3,976.4 Aug 24 4,078.6 Aug 17 4,076.5 Aug 10 4,023.5 Aug 3 3,985.7 July 27 4,059.6 July 20 4,083.6 July 13 4,055.8 July 6 3,986.6 June 29 3,988.4 June 22 4,007.3 June 15 3,975.8 June 8 3,883.5 June 1 3,857.4 May 25 3,893.9 May 18 3,871.7

May 12 3,848.2 May 4 3,820.2 April 27 3,820.9 April 20 3,825.7 April 13 3,772.0 April 6 3,710.1 March 30 3,729.8 March 23 3,759.6 March 16 3,751.5 March 10 3,741.4 March 2 3,715.9 Feb 24 3,781.8 Feb 16 3,741.2 Feb 9 3,707.5 Feb 2 3,755.4 Jan 26 3,896.1 Jan 19 4,066.2 Jan 12 4,218.7 Jan 1 4,391.7 2008 Dec 29 4,283.1 2007 Dec 24 4,016.6 2006 Dec 25 3,002.0 NOTE - Monetary base comprises cash in circulation andcommercial banks' deposits at the central bank. To see more detailed historical data on Russia's monetarybase you can go to www.cbr.ru/eng/main.asp

Business, Energy or Environmental regulations or discussions

Norilsk Nickel, Novatek, Polyus Gold, Tatneft: Russian Preview http://noir.bloomberg.com/apps/news?pid=newsarchive&sid=aY1FVnERhSnM

By Jason Corcoran

Nov. 12 (Bloomberg) -- The following companies may be active in Russian trading. Stock symbols are in parentheses and share prices are from the previous close of trading in Moscow.

The 30-stock Micex Index fell 1.2 percent to 1,556.43 at the close in Moscow. The dollar-denominated RTS Index dropped 0.5 percent to 1,629.69.

OAO GMK Norilsk Nickel (GMKN RX): Copper rose to a 30-month high in New York and touched a record in London as reports showed higher factory output and stronger inflation in China, the world’s biggest consumer of the metal. Norilsk Nickel, Russia’s largest miner, slid 1.7 percent to 5,926.61 rubles on the Micex Stock Exchange.

OAO Novatek (NOTK RX): Russia’s second-biggest natural gas producer is scheduled to report its third-quarter results under International Financial Reporting Standards. The stock added 0.5 percent to 279.21 rubles on the Micex stock exchange.

OAO Polyus Gold (PLZL RX): Gold futures gained 0.6 percent to $1,408.15 an ounce on concern that some European governments may struggle to raise funds. Polyus, Russia’s biggest producer of the precious metal, added 1.2 percent to 1,631.22 rubles on the Micex stock exchange.

OAO Tatneft (TATN3 RX): The Russian oil producer based in Tatarstan is due to report its third-quarter results. The stock declined 1.6 percent to 149.48 rubles on the Micex stock exchange.

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

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

Last Updated: November 11, 2010 22:00 EST

Stimulus fuels two-year highhttp://themoscownews.com/business/20101111/188195177.html?referfrommn

by Ed Bentley at 11/11/2010 19:40

Led by gas company Novatek Russia’s exchanges hit a two-year high driven by higher oil prices following the US government’s decision to continue its stimulus program.

The rouble-denominated Micex closed at 1,595 points on Tuesday before falling back on Wednesday to 1,575 points, ending six straight days of gains.

Russia’s second largest gas company, Novatek led the rally following its board of directors giving approval for a $1.5 billion bond issue to fund two takeovers.

The firm will acquire a 51 per cent stake in Severenergia at a cost of $1.9 billion, Kommersant reported an unnamed Gazprom source saying, and 51 per cent of Sibneftegaz. The company has not released details of the prices for either purchase.

Citibank analysts wrote in a note that the deals could add around 24 per cent to Novatek’s reserves, “which already provides an exceptionally strong base for future growth”.

The takeover also ends speculation that Gazprom, which owns 19.39 per cent of Novatek, would swap a 10 per cent stake in its rival for the controlling stake of Sibneftegaz. The gas monopoly is now likely to sell the shares, due to a growing conflict of interest between the two firms.

“Gazprom’s shareholding does not add anything to Novatek anymore, and the latter has proved that it can successfully grow on its own, so it no longer matters who owns 19.39 per cent, as long as [Gennady] Timchenko and [Leonid] Mikhelson remain core shareholders,” Renaissance Capital analysts in a note to investors.

Metals companies also had a strong start to the week following strong nickel prices and copper hitting a yearly high.

Russia's RUSAL shares fall 9 pct after resultshttp://af.reuters.com/article/metalsNews/idAFHKF00288120101112

Fri Nov 12, 2010 3:25am GMT

HONG KONG Nov 12 (Reuters) - Hong Kong-listed shares of Russia's United Company RUSAL Ltd (0486.HK)(RUAL.PA) fell 9 percent after the world's top aluminium maker on Friday reported a 55 percent drop in quarterly earnings as it made aggressive debt repayments.

The stock fell to as low as HK$9.60.

The company, which gave an upbeat forecast for the global aluminium market going into 2011 [ID:nSGE6AB011], said it would reduce the size of a single lot of its shares to 1,000 from 6,000 to make its shares more accessible to smaller investors. [ID:nHKV002572] (Reporting by Donny Kwok; Editing by Chris Lewis)

Rusal Third-Quarter Profit Falls 55% on Derivatives (Update2) http://noir.bloomberg.com/apps/news?pid=newsarchive&sid=agNrRMPdrj8U

By Bloomberg News

Nov. 12 (Bloomberg) -- United Co. Rusal, the world’s largest aluminum producer, posted a 55 percent drop in third- quarter profit as the value of embedded derivatives fell.

Net income fell to $29 million in the three months ended Sept. 30 from $64 million a year earlier, the Moscow-based producer said in a statement to the Hong Kong stock exchange. Sales rose to $2.71 billion from $2.12 billion.

An increase in aluminum prices on the London Metal Exchange cut the value of embedded contracts by $388 million in the third quarter, Rusal said in the statement. The company expects the metal’s price to remain at $2,300 a ton in the fourth quarter because of “positive” underlying demand and as dollar weakness supports investment in physical assets.

“The loss in derivative value dragged down its third- quarter profit,” said Helen Lau, a Hong Kong-based analyst with UOB-Kay Hian Ltd. “Rising aluminum prices may continue to lead to a loss in fair value in its long-term power contracts, but it will not affect its cash flow.”

Rusal shares fell 8.1 percent to HK$9.65 as of 11.26 a.m. in Hong Kong trading. They have shed about 11 percent since the initial public offering in January, compared with a gain of about 21 percent on the benchmark Hang Seng Index.

Aluminum Tightness

“Physical aluminum stocks tightness will remain for the foreseeable future,” with premiums supported at current levels, the company said in the statement.

Rusal signed contracts for nine to 11 years for power supply from units of its parent in November 2009. Derivatives embedded in the power contracts are pegged to aluminum prices in London, Rusal said.

Aluminum traded on the London Metal Exchange fell 1.6 percent to $2,418 at 11:28 a.m. Hong Kong time. The metal, used in cars, beverage cans and window frames, has gained 7.6 percent this year.

The market value of the company’s 25 percent stake in OAO GMK Norilsk Nickel, Russia’s biggest mining company, rose 21 percent to about $8.1 billion in the nine months to end- September, according to the statement. Rusal revised up first- half earnings by $97 million to $1.365 billion in October as returns from Norilsk Nickel had been understated.

In October, Rusal denied reports of discussions to sell its stake in Norilsk Nickel to fellow shareholder billionaire Vladimir Potanin.

Potanin, who also owns 25 percent of Norilsk, wrote to Rusal Chairman Viktor Vekselberg on Oct. 22 urging him to discuss selling Rusal’s stake in the world’s biggest

nickel producer for $9 billion, according to a report in the Kommersant newspaper on Oct. 28.

Aluminum ETF

Aluminum will probably be the first industrial metal used to back an exchange-traded product in a market where $100 billion has already been invested in precious-metal funds, a Bloomberg survey of analysts showed. Rusal will be able to sell aluminum to the ETF from January, the company has said.

“Such funds may have the effect of stimulating demand for aluminum and balancing supply,” Rusal said in the statement.

Rusal’s sales to China, “small” this year, will rise once the company is qualified to sell on the Shanghai Metal Exchange, which is expected by the end of this year, Rusal’s First Deputy Chief Executive Officer Vladislav Soloviev said Sept. 22. Asia may account for 30 percent of Rusal’s sales, with China taking as much as half that amount, he said then.

Power Restrictions

China’s measures to restrict power supply to metal producers have “affected” one-third of domestic aluminum production capacity and output this year may fall short of forecasts, Xiao Chongxin, executive general manager of Sanmenxia Tianyuan Aluminum Co., a Chinese smelter, said yesterday. Aluminum is used in cars, cans and airplanes.

“China’s power rationing resulted in smelter close-down. This should present Rusal with opportunities to increase their exports to China,” UOB-Kay Hian’s Lau said.

The company expects to produce 4.1 million tons of aluminum next year, little changed from 2010, Soloviev said. Production of alloys will rise to 1.5 million tons from 1.3 million tons.

Billionaire owner Oleg Deripaska said he expects demand to grow fastest in China, where Rusal became the first Russian company to sell shares with a $2.24 billion offering on the Hong Kong exchange in January. Aluminum prices may rise next year as China scales back production, Rusal said in September.

--Helen Yuan and Xiao Yu. Editors: Alan Soughley, Andrew Hobbs

To contact the Bloomberg News Staff on this story: Xiao Yu in Beijing at yxiao@bloomberg.net Helen Yuan in Shanghai at hyuan@bloomberg.net

To contact the editor responsible for this story: Andrew Hobbs at ahobbs4@bloomberg.net.

Last Updated: November 11, 2010 23:43 EST

RusAL posts $1.42 bln IFRS net profit in Jan.-Sept.http://en.rian.ru/business/20101112/161299005.html

05:26 12/11/2010

Russia's UC RusAl, the world's largest aluminum producer, said on Friday its net income calculated to International Financial Reporting Standards (IFRS) totaled $1.42 billion in the first nine months of 2010.

"These much improved results show that UC RUSAL has entered a new growth phase," the company's CEO, Oleg Deripaska, said.

The company reported a net profit of $1.42 billion for the nine months ended 30 September 2010, compared to net loss of $826 million for the nine months ended 30 September 2009.

Revenue increased by 36.6% to $8 billion, adjusted EBITDA increased to $1.89 billion in the reported period.

"We have consolidated our success in reducing costs and improving production efficiency, which has allowed us, in spite of the rising costs of raw materials and energy, to achieve one of the most competitive production costs within the aluminum industry," Deripaska said.

"This enabled us to meet the growing demand for aluminum by continuing to increase production volumes at existing facilities, as well as at the modernized Irkutsk aluminum smelter, where new modern highly efficient equipment was launched. Our aluminum production output grew by 78,000 [metric] tons over the period," he said.

MOSCOW, November 12 (RIA Novosti)

Russia exported 173,900 metric tons of nickel in January-September, some 0.4% less than in January-September 2009, the federal customs service reported

http://www.topnews.in/russia-exported-173900-metric-tons-nickel-januaryseptember-some-04-less-januaryseptember-2009-federa

Submitted by Ajay Kumar Kedia on Fri, 11/12/2010 - 16:31

Russia exported 173,900 metric tons of nickel in January-September, some 0.4% less than in January-September 2009, the federal customs service reported. Nickel has touched a low of Rs 1074.2 a kg after opening at Rs.1088, and last traded at Rs 1076.9.For today market is looking for the support at 1069.6, a break below could see a

test of 1062.2 and where as resistance is now likely to be seen at 1088.9, a move above could see prices testing 1100.8.

Trading Ideas:

Nickel trading range is 1062.2-1100.8.

Russia Jan-Sep nickel exports -0.4% on year at 173,900 tons

Nickel is having resistance at 1088.90 and support at 1069.60 level.

Spread between nickel NOV & DEC contracts yesterday traded in the range of 8.00 - 11.2.

Mitsubishi Revives $1Bln Tatarstan Fertilizer Factory http://www.themoscowtimes.com/business/article/mitsubishi-revives-1bln-tatarstan-fertilizer-factory/422503.html

12 November 2010By Derek Andersen

Japan's Mitsubishi Heavy Industries said Thursday that it would build a $1 billion fertilizer plant in Tatarstan for a state-owned Russian company, reviving a deal that didn't take off two years ago.

Mitsubishi, Japan's Sojitz Corporation and China National Chemical Engineering Corporation plan to sign the contract for the project Saturday at the Asia-Pacific Economic Cooperation summit in Japan, Mitsubishi said in a statement.

The companies will build the plant — one of the largest of its type in the world — for Ammoni, a joint venture between a company called Regiongazfinans and the Tatarstan government, with 68.5 percent and 31.5 percent stakes, respectively, Mitsubishi said. Vneshekonombank, or VEB, has said it would provide loans to foot almost the entire costs of the construction.

"The fertilizer industry is prospering right now," said Alfa Bank analyst Georgy Ivanin.

The new facility, to be constructed in Mendeleyevsk, will produce ammonia and methanol, according to the statement on Mitsubishi's web site. Its projected capacity is 2,050 metric tons of ammonia, or 1,382 tons of ammonia and 668 tons of methanol, per day from natural gas. It has been estimated that production at the site will require 800 million cubic meters of gas per year.

A similar project was announced by Mitsubishi and Ammoni in 2008 when Mintimer Shamiyev, then-president of Tatarstan, laid the cornerstone for the new plant. The project did not proceed beyond that, however.

In May 2009, during a visit by Prime Minister Vladimir Putin to Japan, VEB chairman Vladimir Dmitriyev said in an interview with RIA-Novosti that the project was still active and that the bank would provide $870 million of a total cost of $972 million.

An Ammoni spokeswoman said company CEO Sergei Shevchenko was unavailable to comment on the deal because he had left for Japan to attend the APEC summit. Calls to VEB went unanswered Thursday evening.

Ivanin said prices for nitrogen-based fertilizers, including ammonia, had risen by 30 percent to 40 percent worldwide since the beginning of the year. Offsetting the effects of drought and economic recovery have been driving factors for those prices worldwide.

The situation is Russia is somewhat different, Ivanin said. One consequence of the drought in Russia is that 10 percent to 15 percent less land will be ready for sowing next year, which will reduce the demand for fertilizer, he said. Even so, fertilizer prices in Russia are expected to rise slightly faster than inflation, he added.

"Long-term prospects aren't bad for fertilizer, but short-term they're not so good," Ivanin said of the Russian market.

Given the condition of the Russian market, the plant is likely to concentrate on the foreign market, he added.

Mitsubishi stated that the new plant in Tatarstan will be the first new fertilizer production facility built in the country in the last 20 years. The plant will provide high value for Russia's natural gas resources, Mitsubishi commented in its announcement.

The new plant will use proprietary technology from the Danish Haldor Topsoe company for the concurrent production of ammonia and methanol. That technology is now installed only in one plant in Malaysia, according to Mitsubishi, which built that plant as well.

Sojitz will handle logistics for the construction of the Tatarstan plant.

One measure of the attractiveness of the fertilizer market is the desire of state corporation Russian Technologies to obtain a share in Murmansk-based fertilizer and phosphates producer Apatit. The state corporation is hoping to receive the 20 percent share in Apatit that is now planned for privatization, Vedomosti reported Thursday, citing an unidentified source. The Federal Property Management Agency owns more than 26 percent of that company.

Polyus Gold close to sorting out KazakhGold?

http://www.businessneweurope.eu/dispatch_text13590

Troika DialogNovember 12, 2010

Interfax reported yesterday that Polyus Gold could sign an agreement with the Assaubayev family (former shareholders of KazakhGold) on Monday, agreeing to return KazakhGold assets (namely Kazakhaltyn) to the Assaubayevs, but retain KazakhGold as a Jersey-registered entity, which is effectively a shell with no assets. No details on the transaction were disclosed.

This option looks to be the most reasonable, providing an optimal solution to the conflict with the Kazakh government and allowing Polyus Gold to complete a reverse takeover (RTO), an idea to which it seems strongly committed.

There are likely to be several legal complications related primarily to the existence of minority shareholders in KazakhGold and the $100 mln share issue completed in 2Q10. It remains to be seen how the deal might be structured.

Polyus Gold acquired 50.1% of KazakhGold in mid-2009 for $305 mln, including $190 mln in cash and 1.7 mln local shares. So far, Polyus Gold has invested around $125 mln in the Kazakh company, including $77 mln via a $100 mln share issue at $1.50 per share that was blocked post factum by the Kazakh government.

The final resolution of the spiteful conflict with the Kazakh government could give a good boost to Polyus Gold's share price. That being said, we retain our downbeat stance on the idea of re-domiciliation in London, arguing that the risks of exclusion from the MSCI Index and failure to properly appeal to UK-centered clients outweigh any potential benefits.

Mikhail Stiskin

Russia to build Omsk airport in 2011

http://www.businessneweurope.eu/dispatch_text13590

bneNovember 12, 2010Construction of an international airport called Omsk-Fyodorovka worth $120-$150m near the Siberian city of Omsk is expected to start in 2011, Prime-Tass reports.

Construction of the airport, with a throughput capacity of 1.15m passengers a year, is

expected to be completed in 2014. A large cargo terminal is also expected to be built at the airport, an Omsk government spokesman said.

A consortium of Hochtief AG, Cushman & Wakefield, and Rufaudit-Omsk Bureau have prepared several financial plans for building the airport. The final business plan is expected to be ready sometime in March-May 2011.

Omsk-Fyodorovka Airport is intended to replace the existing Omsk airport, which is located within the city boundaries.

For the Record http://www.themoscowtimes.com/business/article/for-the-record/422516.html

12 November 2010

Polyus Gold may agree next week to return gold assets in Kazakhstan to the Assaubayev family and retain the London-listed KazakhGold Group entity that the mining company has sought to use to attract more investors, Interfax reported Thursday. (Bloomberg)

The Deposit Insurance Agency’s total insurance fund, including bank contributions, will be 142 billion rubles at the end of 2010, the agency’s director, Alexander Turbanov, said Thursday. (Interfax)

Merrill Lynch signed an agreement with the Federal Property Management Agency on managing the sale of 10 percent of VTB Group, the agency said Thursday. (Bloomberg)

Sberbank said Thursday that it signed an agreement with American Express to start issuing the U.S. company’s credit cards denominated in dollars, euros or rubles “early in 2011.” (Bloomberg)

Activity in the Oil and Gas sector (including regulatory)

Naftogaz shall pay Russia for gas $1 billion a month in Q4 http://bsanna-news.ukrinform.ua/newsitem.php?id=14646&lang=en

KYIV, November 12. /UKRINFORM/. Naftogaz of Ukraine in the 4th quarter of 2010 shall pay for Russian gas $1 billion a month, head of the company, Yevhen Bakulin, said during a selector conference at the Cabinet.

"Every month we have to pay for Russian gas $1 billion, i.e. we have to collect from the market 8 billion UAH. This is a major challenge that we must think over now," Bakulin said.

For the natural gas imported in October 2010, Naftogaz has transferred to Gazprom about 1.063 billion dollars.

The price of gas in the 4th quarter of this year amounts to about $253 per thousand cubic meters. In the third quarter this year, Russian gas cost Ukraine $248.72.

Russian crude free from reliance on transit countries

http://www.businessneweurope.eu/dispatch_text13590

bneNovember 12, 2010

A representative of pipeline operator Transneft claimed this morning that Russia is to cease shipping crude through Ukraine and Belarus, adding that the country is soon to be entirely free from reliance on transit countries, Oil & Gas Eurasia reports.

The move appears to be retaliation for the recent deal struck by the two transit countries to reverse a pipeline that currently carries minimal supplies of Russian crude from the main Druzhba pipeline - which runs through Ukraine to Europe - to the port of Odessa for export via the Black Sea. The move will see Belarus reduce its reliance on Russian crude supplies, and also open a route for Caucasian crude to be delivered to the EU.

The Odessa-Brody pipeline - originally built in the 1990s to carry oil from the Caucus to Europe but reversed after lobbying by Russian oil companies - is set for a test run of carrying oil from Odessa to Minsk on November 17. Kiev and Minsk signed a deal in October that will see Ukraine transport Venezuelan oil - delivered by tanker to Odessa - to Belrusian refinieries.

Minsk agreed to buy oil from the South American country earlier this year in a bid to reduce its reliance on Russian supplies. Russia has recently applied duties to Belarusian imports which are refined and then re-exported to Europe - a move which has put a big dent in Minsk's finances.

Moscow is evidently unhappy with the move. Transneft First Vice President Mikhail Arustamov said this morning that Russia had actively used Odessa-Brody when it did not have enough export capacity. However, he claimed that with the East Siberia-Pacific Ocean pipeline now operating, this lack of capacity has been almost completely alleviated, NEWSru.com reports.

In January 2011, when 15m tonnes of crude will be pumped to China every year, the lack of export capacity will be practically eradicated, he said. At the same time, he insisted that with the looming launch of the Ust-Luga port in Leningrad Region, Transneft will be entirely free of reliance on transit countries.

Arustamov added that the second line of the Baltic pipeline system will be filled with crude which is currently pumped via the Druzhba pipeline through Belarus to Gdansk and also with crude now flowing through the Odeessa-Brody and Brody-Yuzhniy pipelines.

In late October, Russia's Energy Minister Sergei Shmatko had announced that Moscow was ready to sign a framework agreement with Kiev regulating the transit of Russian crude oil through Ukraine.

12.11.2010

Russia To Stop Shipping Crude Via Ukraine and Belarushttp://www.oilandgaseurasia.com/news/p/0/news/9471

Russia will stop shipping crude through Ukraine and Belarus, Transneft First Vice President Mikhail Arustamov said adding that Russia had actively used the ODessa-Brody and Brody-Yuzhniy pipelines when it did not have enough export capacity. But, he said, with the East Siberia-Pacific Ocean pipeline opened, this lack of capacity has been almost completely alleviated, NEWSru.com reports.  

In January 2011, when 15 million tons of crude will be pumped to Chain every year, the lack of export capacity will be practically eradicated, he said.

Arustamov said that in light of the looming launch of the Ust-Luga port in Leningrad Region, Transneft will no longer be dependent on countries with pipelines.

He clarified that the second line of the Baltic pipeline system would be filled with crude which is currently pumped via the Druzhba pipeline through Belarus to Gdansk and also with crude now flowing through the Odeessa-Brody and Brody-Yuzhniy pipelines.

Copyright 2010, Gazeta.kz. All rights reserved.

First Post-Soviet Refinery to Start Sales and Expand http://www.themoscowtimes.com/business/article/first-post-soviet-refinery-to-start-sales-and-expand/422507.html

12 November 2010Bloomberg

Tatneft will start sales by early next year from the nation’s first new refining complex since the collapse of the Soviet Union, as it considers doubling capacity, company chairman Rustam Minnikhanov said in an interview with Bloomberg.

“The political approval is there,” said Minnikhanov, who is also president of Tatarstan. “A decision will be made in the near future — it depends on money.”

The government funded about 5 percent of the 290 billion ruble ($9.5 billion) project, as it seeks to raise the price of the Urals crude export blend by removing lower quality oil from pipelines and refining it domestically. The government is pushing refiners to expand and upgrade to cut dependence on raw materials exports and reduce fuel and petrochemicals imports.

Tatneft, which owns 91 percent of the plant, may sell shares in the refinery to raise financing, Minnikhanov said. The Tatarstan government holds the other 9 percent, he said.

Refining may help revive Tatneft’s fortunes, as annual output growth has stalled at less than 1 percent for the past four years. Oil-product sales at the refinery, called Taneco, will start this year or early next year, after construction began in 2005, Minnikhanov said.

Igor Sechin, Prime Minister Vladimir Putin’s deputy in charge of the energy industry, urged Tatneft to expand the plant, Khamza Bagmanov, the project’s head, said at a government meeting last month on development of the energy industry to 2020.

Tatneft has spent more than 75 percent of a planned 220 billion rubles to bring Taneco to a capacity of 7 million metric tons (140,000 barrels a day), with a full range of products by 2016, Minnikhanov said. Doubling capacity will increase the cost about 32 percent to 290 billion rubles, Minnikhanov said.

“Tatneft’s priority is the search and realization of investment projects in refining,” Minnikhanov said. The company will maintain its dividend policy of paying out 30 percent of profit under Russian accounting standards, he said.

Second-quarter profit to U.S. generally accepted accounting principles plunged 41 percent from a year earlier as Tatneft pumped oil into storage rather than selling it and taxes rose faster than oil prices. Nine-month net income may be at the same level or slightly below last year’s level, Minnikhanov said, without elaborating.

The company is seeking to exploit the region’s bitumen or heavy oil resources to boost output. Tatarstan may hold as much as 7 billion tons of heavy oil, according to the regional government.

Tatneft plans to produce 250,000 tons of the highly viscous oil in 2015 under a pilot project, Minnikhanov said. Russia is working out tax discounts for the hard-to-produce fuel. Talks with Royal Dutch Shell and Chevron about jointly developing fields have

stalled, he said. Russia has the technology needed to process bitumen into synthetic oil without their help, he said.

“High-viscosity oil is one of the sources that will allow the country’s output to remain at 500 million tons for decades,” Minnikhanov said.

Oil consignment delivered to Thailand from Sakhalinhttp://english.ruvr.ru/2010/11/12/33521641.html

Nov 12, 2010 09:48 Moscow TimeA consignment of oil, produced in the framework of the Sakhalin-2 project has been delivered to Thailand for the first time ever, says the press service of the Sakhalin Energy Company. It took an oil tanker almost a month to take the crude to Thailand and come back. Sakhalin Energy has delivered a total of some 11 million tons of oil to Japan, North Korea, China, Thailand, Taiwan, the Philippines, the United States and New Zealand since the company began its round-the-year supplies in December 2008. The overall cost of the Sakhalin-2 project makes up 20 billion dollars. The Sakhalin Energy shareholders are Gazprom, Royal Dutch/Shell and Japan’s Mitsui and Mitsubishi Corporations. 

12.11.2010

Rosneft Subsidiary Acquires Rights To Three Oil-bearing Blockshttp://www.oilandgaseurasia.com/news/p/0/news/9470

Samaraneftegaz, a Rosneft subsidiary, has acquired the rights to work three  oil-bearing blocks: the Gnezdinskiy, Zimarniy and West-Shirokinskiy. the auction for the blocks was conducted by the subsoil agency in Samara Region.

The company offered 124.3 million rubles for the rights to develop these blocks which are estimated to have total recoverable reserves of over 1 million tons of crude.

The blocks are located in areas already worked by Rosheft and in close proximity to Samaraneftegaz fields which are scheduled to produce over 10 million tons of crude this year, the company reported in a news release.

Copyright 2010, Oil and Gas Information Agency. All rights reserved.

November 12, 2010 10:09

Bashneft may pay 104.5 rubles per share for 9 mthshttp://www.interfax.com/newsinf.asp?id=201375

MOSCOW. Nov 12 (Interfax) - Bashneft (RTS: BANE) may pay an interim dividend for the first nine months of 2010 equal to 104.5 rubles per ordinary and preferred share, the company said in a statement.

The dividend payout would total 21.4 billion rubles.

An extraordinary shareholders' meeting has been scheduled for December 17 to vote on the dividend. Shareholders of record on November 12 may participate.

RTS$#&: BANE

Lukoil invests $550 mln in Ukrainian petrochemical subsidiaryhttp://www.businessneweurope.eu/dispatch_text13590

bneNovember 12, 2010

Lukoil has invested over $550min the upgrade of its Ukrainian petrochemical subsidiary Karpatneftekhim, Prime Tass reports.

Lukoil has launched a unit for the production of chlorine and caustic soda at Karpatneftekhim in order to reach an annual production capacity of 200,000 tonnes of caustic soda and 180,000 tonnes of chlorine.

The planned capacity of the polyvinylchloride production unit also launched at Karpatneftekhim is 300,000 tonnes annually, the press service of Ukrainian President Viktor Yanukovich said.

Lukoil is expected to increase its investment in Karpatneftekhim to $1 billion, Yanukovich said, speaking at the launch ceremony for the units.

Fitch downgrades outlook on Novatek's BBB- rating to Negative on increasing debt concerns http://www.businessneweurope.eu/dispatch_text13590

Alfa BankNovember 11, 2010

Fitch has downgraded its outlook on Novatek following an announcement by the company's board of directors that it plans to increase debt by $1.5bn to acquire a 25.5% stake in Severnaya Energiya from Gazprom via the 50/50 Yamal development joint venture and the acquisition of 51% in Sibneftegaz from Gazprombank.

Fitch believes that the additional borrowing required for these two deals will increase the company's financial risks. However, the agency agrees that the assets would improve Novatek's business structure, as it would strengthen its strategic position on the Yamal Peninsula. In addition, these assets will create a synergy with the company's activities in the region, and Fitch expects that Novatek will immediately generate additional cash flow from the assets.

Belarus refining of Russian duty-free oil to drop sharply in 2H 2010http://www.businessneweurope.eu/dispatch_text13590

bneNovember 12, 2010

Belarus will decrease refining of Russian duty- free oil in July-December compared to January-June, Prime-Tass reported, as Minsk reduces its reliance on Russian oil in the face of import duties on oil that it processes for re-export to European markets.

That move has provoked a dramatic fall to the budget, and Belarus is now courting Venezuela and Iran to make up the shortfall in Russian oil imports.

The drop in Russian oil supplies in July-September and planned drop for October-December were attributed to the fact that Belarusian refineries processed the major part of Russian duty-free oil to be supplied in 2010, in January-June, a sources.

Specifically, Belarusian oil refineries plan to process around 400,000 tonnes of Russian duty-free oil in November, down from 700,000 in February. Of the total, the Naftan Refinery is to process 267,000 tonnes, while the Mozyr Refinery is to process 127,000 tonnes.

In 2010, Belarusian refineries are expected to process 6.3 million tonnes of Russia duty-free oil and 7.8 million tonnes of Russian oil burdened with duty.

Separately, the source also said that supplies of Venezuelan oil to Belarusian refineries are expected to amount to 320,000 tonnes in November. Of the total, the Naftan Refinery is to receive two tankers with a total of 160,000 tonnes of oil through Estonia's Muuga port, while Mozyr Refinery is to receive two tankers with a total of 160,000 tonnes of oil through Ukraine's Odessa port. Supplies of Venezuelan oil are planned to total 4 million tonnes in 2010.

In 2009, Belarusian refineries processed around 11 million tonnes of oil each.

Gazprom