Russia



Russia 110718Basic Political DevelopmentsItar-Tass news outlook for Monday, July 18. KAZAN – The operation to lift to the surface the sunken ship Bulgaria is to be continued at the Kuibyshev reservoir on the Volga River. On Monday, specialists will try to bring the vessel on an even keel. HANNOVER - Russian President Dmitry Medvedev is arriving in Germany on a visit, where together with Federal Chancellor Angela Merkel will take part on Tuesday in interstate consultations and a meeting of the Forum “Petersburg Dialogue.” Medvedev and Merkel will also discuss higher Russian gas supplies to Germany at Russian-German interstate consultations, which will be held in the German city of Hannover on July 18-19 MOSCOW - The Foreign Ministers of Azerbaijan and Russia, Sergei Lavrov and Elmar Mamedyarov, will discuss ways to resolve the Nagorno-Karabakh conflict in light of new proposals put forward by the Russian president. Along with the Karabakh problem Lavrov and Mamedyarov will discuss the entire scope of relations between the two countries. They will exchange the instruments of ratification of the Russian-Azerbaijani Treaty on the State Border and will sign a plan of consultations between the foreign ministries for the second half of 2011 and 2012. ROME - A court in Milan will hold hearings in two cases at once against Italian Prime Minister Silvio Berlusconi - corruption (Mills Case) and case of paying for sex with a teenaged nightclub dancer when she was below the legal age limit of 18 (Ruby Case). The prime minister is expected to attend the Mills Case hearing. PRETORIA - The fight against terrorism and regional armed conflicts will be in the focus at talks during a working visit of British Prime Minister David Cameron to South Africa. BAIKONUR – The Zenit-3SLBF carrier rocket with a unique astrophysical observatory - Spektr-R (Spectrum-R) was launched from the Baikonur cosmodrome on Monday. Spectrum-R is the first Russian automatic astrophysical observatory over the past 25 years that will enable the scientists to observe remote extragalactic objects in the radio frequency spectrum of the electromagnetic waves with a super high resolution. MOSCOW - Russia has completed a “second wave” of the Unified State Examination (USE). MOSCOW - The Russian capital is for the first time hosting the prestigious World Opera Competition “Operalia” founded by Placido Domingo. TVER – The guitar song festival in memory of Yuri Vizbor on Lake Seliger. BOLSHOYE GOLOUSTNOYE (Irkutsk region) - The First International Industrial Forum “Engineers of the Future” is held here. SAMARA – The GM-AvtoVAZ joint venture and the Ulyanovsk Automobile Plant (UAZ) go on summer vacation until the end of the month. MAGADAN - The Evenks’ first fish festival – Bakyldydyak has been held in Kolyma. Itar-Tass news digest for Monday, July 18. MOSCOW — Russian President Dmitry Medvedev has approved ratification of the protocol on anti-dumping measures within the Eurasian Economic Community (EurAsEC). The Kremlin press service reported on Monday that the President signed the Federal Law “On Ratification of the Protocol on the procedure of provision to the authority conducting an investigation, of information containing, among others, confidential data for purposes of investigations prior to the introduction of special protective, antidumping and compensatory measures in relation to third countries.” BAIKONUR (Kazakhstan) — The booster Zenith-3SLBF with the astrophysical observatory Spectrum-R was launched at 6.31 a.m. Moscow time on Monday from the Baikonur spaceport, Itar-Tass reported from the spaceport. KIEV — The deployment of the Russian Black Sea Fleet in the Crimea does not encroach on Ukraine’s sovereignty, Speaker of the Verkhovna Rada Vladimir Litvin said in an interview with the parliamentary television channel on Sunday. “Take a look at European countries, where US military bases are deployed,” he said. Litvin came out in favour of the development of pragmatic relations with Russia. “To speak about a perpetual friendship it means not to comprehend modern processes,” he believes. “This fact points to the unwillingness to agree about a true cooperation,” the parliamentary speaker noted. MOSCOW — A man was killed, another two were injured in a massive brawl in downtown Moscow, a source in the Moscow law enforcement agencies told Itar-Tass on Monday. The brawl broke out in the Yuzhny Bystreet near the Kazansky railway station. The exact number of brawlers is being investigated. “During the brawl three people received knife wounds. One of them died, another two were hospitalized in severe condition,” the source said. MAKHACHKALA — A car was blasted near the city police department in the Dagestani city of Kaspiisk on Monday. According to preliminary reports, several policemen were injured in the car blast. “The explosion went off at about 2 a.m. Moscow time on Monday,” sources in the Kaspiisk law enforcement agencies told Itar-Tass on Monday. The eyewitnesses said that they were feeling a strong gas smell at the blast site. The police do not rule out that the blast damaged the local trunk gas pipeline. MAKHACHKALA— A policeman died at the hospital, another two policemen were injured in the blast, which went off when a police patrol car was driving in the Dagestani city of Kaspiisk overnight to Monday, spokesman for the Dagestani branch of the Investigation Committee told Itar-Tass on Monday. MAKHACHKALA — Criminal proceedings have been instituted over the explosion in Kaspiisk, Dagestan, under four articles of the RF Criminal Code – “infringement on the life of law enforcement officers,” “Illicit trafficking of explosives, explosive devices,” “Illegal making of explosive devices” and “intentional infliction of damage on property,” the Interior Ministry of Dagestan told Itar-Tass on Monday. MOSCOW — A criminal case has been opened against a doctor of Butyrka prison and a former deputy prison chief who supervised the Butyrka hospital block, spokesman for the Investigative Committee Vladimir Markin told Itar- Tass on Monday. Former prison doctor Larisa Litvinova, who supervised Sergei Magnitsky in prison, is facing charges of causing a patient's death through carelessness and professional negligence; her direct chief Dmitry Kratov - former deputy chief of the prison hospital block, was accused of negligence. KRASNOYARSK — More than 30 wildfires have engulfed on 1,144 hectares of forests in Siberia. The firemen have put out 15 fires for the past day, but the area of extinguished fires went down slightly by just 197 hectares. The firemen have localized another 11 fires on 390 hectares. Most fires were reported in the north-eastern part of the Krasnoyarsk Territory on the borderline with the Irkutsk Region and in the Baikal Territory, a source in the Siberian regional emergencies center told Itar-Tass on Monday. KHABAROVSK — The area of wildfires in Russia’s Far East has grown to 15,110 hectares, or nearly three times as compared with Sunday. The Forestry Department of the Far Eastern Federal District told Itar-Tass that “31 fires have been registered in the federal district. The most difficult is the situation in Yakutia, where there are 24 fires burning at an area of 10,423 hectares of forestland and 4,423 hectares of non-forest areas.” SAMARA — The Togliatti-based GM-AvtoVAZ plant on Monday is suspending the assembly line’s operation in connection with a summer vacation. The plant’s press service reported that the vacation will last until the end of the month. During this time, maintenance of equipment will be carried out at the plant. From August 1 the company will operate as usual. VLADIVOSTOK— The legality of the use of ships that are more than 30 years old will be checked in Russia’s Far East. Many of them with Russian crews are working at sea under the flags of convenience and belong to foreign ship owners. MOSCOW — Moscow’s Basmanny Court on Monday is expected to announce a sentence in absentia to former head of the Fargoil company, affiliated with Yukos – Spanish citizen Antonio Valdes Garcia, who is accused of embezzling and laundering of 13 billion US dollars. Earlier, during hearing of the sides’ arguments the prosecutor asked the court to give him a sentence of 13 years imprisonment in a tight security penal colony. According to the public prosecutor, the defendant’s guilt has been proven in full and confirmed by the case materials. MOSCOW — The Federal Air Transport Agency ( Rosaviatsia) has either suspended or withdrawn licenses of several domestic airline companies, including "Moskovia", Rosaviatsia told Itar-Tass. “Moskovia” had its license suspended because of worsened basic transportation and financial economic parameters which affected safety of flights and infringed on consumer rights; the Taganrog Aviation Scientific- -Technical Complex had its license suspended because of the absence of normally operating aircraft, Rosaviatsia said. Russia criticises West's backing of Libyan rebels - "Those who declare recognition stand fully on the side of one political force in a civil war," Russian Foreign Minister Sergei Lavrov told reporters. Russian, UK military chiefs to discuss cooperation prospects - Chiefs of Staff of Russia and Britain will meet in Moscow on July 18Medvedev starts visit to Germany - Medvedev leads a delegation of over 20 ministers, top officials and chief executives of major Russian companies. He is heading to Hanover to hold intergovernmental consultations and assess bilateral relations on the whole.St Petersburg Dialogue to broaden RF-Germany society cooperation. - The 11th session of the Russian-German public forum St. Petersburg Dialogue will promote a deeper mutual understanding between the civil societies in Germany and Russia, the forum’s German co-chairman Lothar de Maiziere told a press conference on Sunday before the opening ceremony of the forum. Medvedev, Merkel to discuss RF-EU ties, Middle East, North Africa. Medvedev, Merkel to discuss higher RF gas supplies via Nord Stream. - “Since German partners are interested in the issue, I believe that higher Russian gas supplies to Germany will be discussed,” he said. “Since Germany decided at the state level to halt the national nuclear industry by 2022, new vistas open up for a broader cooperation in this sphere, including in developing the prospects for higher Russian gas supplies through the Nord Stream pipeline, which will be launched in October 2011,” the presidential aide said. R?sler welcomes mooted Gazprom expansion - German Economy Minister Philipp R?sler would welcome increased investment by controversial Russian gas giant Gazprom - a topic for Chancellor Angela Merkel's meeting with Russian president Dmitri Medvedev on Monday. Growing energy ties set tone for Merkel-Medvedev talks - Weekly newspaper Die Zeit writes in its current issue that key partners such as France, Britain and the United States, already sceptical about the nuclear phaseout, are uneasy about greater German reliance on Russian gas.Russia says German Quadriga jury board poorly organizedGermans Snub Putin Before Medvedev Visit - By Alexander BraterskyAzerbaijani and Russian FMs exchange official documents on state border treaty ratificationAzerbaijani FM deliveres response to Russian President's proposal on Nagorno-KarabakhAzerbaijani FM gives Aliyev’s response to Medvedev Karabakh proposal. Russia, Azerbaijan to discuss breakaway Karabakh settlementRussia, Azerbaijan FMs to discuss Karabakh peace process in Moscow. Azeri foreign minister to discuss Karabakh issue in MoscowRussia, U.S. disagree on meat imports during WTO talks - Russia and the United States during the World Trade Organization (WTO) talks could not reach an agreement on meat imports, Russian Economic Development Minister Elvira Nabiullina said.Russian Black Sea Fleet not encroach on Ukraine’s sovereignty. - The deployment of the Russian Black Sea Fleet in the Crimea does not encroach on Ukraine’s sovereignty, Speaker of the Verkhovna Rada Vladimir Litvin said in an interview with the parliamentary television channel on Sunday. Russian border guards will not return to Tajik-Afghan border – officialTajikistan hopes new deal with RF be signed in September – FM: Tajikistan hopes that a new agreement with Russia on military cooperation, including on the 201st military base and the Aini airfield, will be signed not later that in September, Tajik Foreign Minister Khamrokhon Zarifi said. Arrested spy chiefs seen using Russian-connected firm against “Fidesz danger” at National Security Office - The weekly earlier downplayed claims that energy giant MOL or hacking was at the center of the case. Instead, the paper suggested a Russian-connected company had collected information from within the NBH with help from well-placed Hungarians.Medvedev signs law on ratifying EurAsEC antidumping protocol. Putin Deputies May Run in December Elections, Vedomosti Reports - First Deputy Prime Ministers Igor Shuvalov and Viktor Zubkov as well as Deputy Prime Ministers Alexander Zhukov, Vyacheslav Volodin, Igor Sechin and Dmitry Kozak will top the lists of United Russia, Putin’s party, the Moscow-based newspaper said. Air Transport Agency suspends several airline companies. – Besides /Moskovia/, Rosaviatsia has withdrawn licenses from "Alania", "Aviaenergo", "Novosibirsk Enterprise", "Avial NV" and "Youg Line" ( South Line) domestic airline companies three months after their licenses were suspended. Over 180 terror acts staged in North Caucasus in 2011 Caucasus bombings kill three Russian police officers, injure nineTwo cops killed, 7 injured in Chechnya blastFour policemen killed by bombs in southern Russia - The blast also damaged a gas pipeline, disrupting the city's supplies.Several policemen injured in car blast in Dagestan’s Kaspiisk. Two police officers killed in south Russia explosion - investigatorIngushetia to install GLONASS systems in passenger transportZenith brings unique astrophysical observatory Spectrum-R in space. Russia, Kazakhstan to build joint launch site at BaikonurVostochny spaceport to test new technologies - Federal Space Agency: Russia has no alternative to the Baikonur spaceport it rents from Kazakhstan and will have no such alternative in the near future, Federal Space Agency head Vladimir Popovkin told reporters at the spaceport on Saturday.Far East forest fire area grows three times. Hot, dry weather makes forest fires spreading quicker in Siberia. Legality of use of ships older 30 years to be checked in Far East. Two missing after Russian coal mine accidentDoctor, deputy prison chief responsible for Magnitsky’ s death charged. Court finds ex-head of Yukos subsidiary guilty in absentia. RIA Russian Press at a Glance, Monday, July 18, 2011ITAR-TASS Russian press review. Is WTO ready for Russian bear? - By CLAYTON YEUTTERRoscosmos looks to NASA - After the successful rocket launch from Baikonur Cosmodrome, the head of Russia’s Federal Space Agency (Roscosmos), Vladimir Popovkin, shared with reporters his vision of the future of Russia’s rocket and space industry. “We are working to attract private business to the space industry,” said Popovkin. “Perhaps, a number of enterprises will be re-established as a private-public partnership.” He did not go into detail about the reform, explaining that the concept is not yet fully developed.Brotherly Love - The Recent Church Council in Kiev Highlighted the Complex Relationship between Ukrainians and Russians Russia Profile Weekly Experts Panel: Will a Center-Right Party Led by a Billionaire Become a Game Changer in Russian Politics?Russia and the flight of capital - Are investors running scared as uncertainty reigns over Russia's political future?Vladimir Putin 'asked to get Chelsea place for Kazakh President's grandson'DEATH OF RUSSIA. Russia moves toward decentralization and disintegration – KavkazcenterShitty little country Austria licks boots of Russians - aggressive and armed enemies of civilization - KavkazcenterNational Economic Trends$36Bln of State Assets a Year to Sell - The?Economic Development Ministry expects to?earn 1 trillion rubles ($35.6 billion) a?year under an?expanded asset-sale program, Economic Development Minister Elvira Nabiullina was cited as saying Saturday.Privatisation sell-off to expand to RUB1 trillion in assets each year Economics Ministry proposes selling 10 pct in RusNanoBanks have 661.8 bln rbs on CBR correspondent accounts on July 18.Ruble Heads for Week-Low as Europe Debt Woes Curb Risk AppetiteRussian figures should point to strengthening investment activity Industrial output up 5.7% y/y in June, 5.3% y/y in 1H11 Business, Energy or Environmental regulations or discussionsNovolipetsk Steel, Polyus Gold, VTB Group: Russia Equity PreviewUPDATE 1-Russia NLMK Q2 sales rise to $2.9 blnInter RAO Buys Wind Power Station in Lithuania, Kommersant SaysRussia's auto market set to grow - VW Fiat abandons plans to build Nizhny Novgorod plantFiat Seeks Russia Car Plant in St. Petersburg, Kommersant SaysHyundai Heavy to build plant for power switchgears in Russia VTB first quarter profit soars 71% to 26 bln rblsUPDATE 1-VTB posts record Q1 net, BoM rescue on trackVTB seals deal on another acquisition - Undeterred by the cost of cleaning up the Bank of Moscow, VTB signed off on a deal to take control of another bank on Friday, increasing its stake in TransCreditBank. Seller Russian Railways could pocket RUB40bn from the sale, reports Prime. Sberbank Enters Ex-Satellites as $13 Billion East Europe Bank Deals LoomBarclays faces large loss in Russian exit – by Jill Treanor CTC Media opens new facilityActivity in the Oil and Gas sector (including regulatory)Russia ratifies common oil market accord Oil Duty Could Fall 1.5% IEA: Gas Deliveries from FSU to Europe Reported Up 14.2 Percent in AprilVankor Tax Exemption Ends Soon Ukrainian authorities to help Lukoil re-launch refineryTony Hayward’s investment vehicle Vallares is eyeing up ?8bn Russian paydayEx-BP boss Hayward eyes Russian oil deals – reportTNK-BP Agrees To Take 45% Stake In Brazil Project - Sources TNK-BP Begins Replacing Pumps at Khokhoryakovskoe Oil&Gas FieldNovatek mulls 800 mln eur pact with EnBW-reportNovatek first to navigate the Northern Sea Route in 2011 GazpromLithuania sees no possibility of agreeing with Gazprom on reducing gas pricesMuravlenkovskneft Installs Innovative Flexible PipelinesSechin favors Gazprom/Renova energy assets consolidation ------------------------------------------------------------------------------------------Full Text ArticlesBasic Political Developments10:28?18/07/2011ALL NEWSItar-Tass news outlook for Monday, July 18. Tass 87 Telephone: 8 (499) 791-00-25 Fax: 8 (499) 791-00-26 BULGARIA SHIP LIFTING OPERATION KAZAN – The operation to lift to the surface the sunken ship Bulgaria is to be continued at the Kuibyshev reservoir on the Volga River. On Monday, specialists will try to bring the vessel on an even keel. MEDVEDEV’S VISIT TO GERMANY HANNOVER - Russian President Dmitry Medvedev is arriving in Germany on a visit, where together with Federal Chancellor Angela Merkel will take part on Tuesday in interstate consultations and a meeting of the Forum “Petersburg Dialogue.” Medvedev and Merkel will also discuss higher Russian gas supplies to Germany at Russian-German interstate consultations, which will be held in the German city of Hannover on July 18-19 RUSSIA-AZERBAIJAN MOSCOW - The Foreign Ministers of Azerbaijan and Russia, Sergei Lavrov and Elmar Mamedyarov, will discuss ways to resolve the Nagorno-Karabakh conflict in light of new proposals put forward by the Russian president. Along with the Karabakh problem Lavrov and Mamedyarov will discuss the entire scope of relations between the two countries. They will exchange the instruments of ratification of the Russian-Azerbaijani Treaty on the State Border and will sign a plan of consultations between the foreign ministries for the second half of 2011 and 2012. ITALY – PRIME MINISTER ROME - A court in Milan will hold hearings in two cases at once against Italian Prime Minister Silvio Berlusconi - corruption (Mills Case) and case of paying for sex with a teenaged nightclub dancer when she was below the legal age limit of 18 (Ruby Case). The prime minister is expected to attend the Mills Case hearing. BRITAIN - SOUTH AFRICA PRETORIA - The fight against terrorism and regional armed conflicts will be in the focus at talks during a working visit of British Prime Minister David Cameron to South Africa. SPACE BAIKONUR – The Zenit-3SLBF carrier rocket with a unique astrophysical observatory - Spektr-R (Spectrum-R) was launched from the Baikonur cosmodrome on Monday. Spectrum-R is the first Russian automatic astrophysical observatory over the past 25 years that will enable the scientists to observe remote extragalactic objects in the radio frequency spectrum of the electromagnetic waves with a super high resolution. EDUCATION MOSCOW - Russia has completed a “second wave” of the Unified State Examination (USE). CULTURE MOSCOW - The Russian capital is for the first time hosting the prestigious World Opera Competition “Operalia” founded by Placido Domingo. TVER – The guitar song festival in memory of Yuri Vizbor on Lake Seliger. RUSSIAN REGIONS BOLSHOYE GOLOUSTNOYE (Irkutsk region) - The First International Industrial Forum “Engineers of the Future” is held here. SAMARA – The GM-AvtoVAZ joint venture and the Ulyanovsk Automobile Plant (UAZ) go on summer vacation until the end of the month. MAGADAN - The Evenks’ first fish festival – Bakyldydyak has been held in Kolyma. 11:41?18/07/2011ALL NEWSItar-Tass news digest for Monday, July 18. Tass 111 MOSCOW — Russian President Dmitry Medvedev has approved ratification of the protocol on anti-dumping measures within the Eurasian Economic Community (EurAsEC). The Kremlin press service reported on Monday that the President signed the Federal Law “On Ratification of the Protocol on the procedure of provision to the authority conducting an investigation, of information containing, among others, confidential data for purposes of investigations prior to the introduction of special protective, antidumping and compensatory measures in relation to third countries.” BAIKONUR (Kazakhstan) — The booster Zenith-3SLBF with the astrophysical observatory Spectrum-R was launched at 6.31 a.m. Moscow time on Monday from the Baikonur spaceport, Itar-Tass reported from the spaceport. KIEV — The deployment of the Russian Black Sea Fleet in the Crimea does not encroach on Ukraine’s sovereignty, Speaker of the Verkhovna Rada Vladimir Litvin said in an interview with the parliamentary television channel on Sunday. “Take a look at European countries, where US military bases are deployed,” he said. Litvin came out in favour of the development of pragmatic relations with Russia. “To speak about a perpetual friendship it means not to comprehend modern processes,” he believes. “This fact points to the unwillingness to agree about a true cooperation,” the parliamentary speaker noted. MOSCOW — A man was killed, another two were injured in a massive brawl in downtown Moscow, a source in the Moscow law enforcement agencies told Itar-Tass on Monday. The brawl broke out in the Yuzhny Bystreet near the Kazansky railway station. The exact number of brawlers is being investigated. “During the brawl three people received knife wounds. One of them died, another two were hospitalized in severe condition,” the source said. MAKHACHKALA — A car was blasted near the city police department in the Dagestani city of Kaspiisk on Monday. According to preliminary reports, several policemen were injured in the car blast. “The explosion went off at about 2 a.m. Moscow time on Monday,” sources in the Kaspiisk law enforcement agencies told Itar-Tass on Monday. The eyewitnesses said that they were feeling a strong gas smell at the blast site. The police do not rule out that the blast damaged the local trunk gas pipeline. MAKHACHKALA— A policeman died at the hospital, another two policemen were injured in the blast, which went off when a police patrol car was driving in the Dagestani city of Kaspiisk overnight to Monday, spokesman for the Dagestani branch of the Investigation Committee told Itar-Tass on Monday. MAKHACHKALA — Criminal proceedings have been instituted over the explosion in Kaspiisk, Dagestan, under four articles of the RF Criminal Code – “infringement on the life of law enforcement officers,” “Illicit trafficking of explosives, explosive devices,” “Illegal making of explosive devices” and “intentional infliction of damage on property,” the Interior Ministry of Dagestan told Itar-Tass on Monday. MOSCOW — A criminal case has been opened against a doctor of Butyrka prison and a former deputy prison chief who supervised the Butyrka hospital block, spokesman for the Investigative Committee Vladimir Markin told Itar- Tass on Monday. Former prison doctor Larisa Litvinova, who supervised Sergei Magnitsky in prison, is facing charges of causing a patient's death through carelessness and professional negligence; her direct chief Dmitry Kratov - former deputy chief of the prison hospital block, was accused of negligence. KRASNOYARSK — More than 30 wildfires have engulfed on 1,144 hectares of forests in Siberia. The firemen have put out 15 fires for the past day, but the area of extinguished fires went down slightly by just 197 hectares. The firemen have localized another 11 fires on 390 hectares. Most fires were reported in the north-eastern part of the Krasnoyarsk Territory on the borderline with the Irkutsk Region and in the Baikal Territory, a source in the Siberian regional emergencies center told Itar-Tass on Monday. KHABAROVSK — The area of wildfires in Russia’s Far East has grown to 15,110 hectares, or nearly three times as compared with Sunday. The Forestry Department of the Far Eastern Federal District told Itar-Tass that “31 fires have been registered in the federal district. The most difficult is the situation in Yakutia, where there are 24 fires burning at an area of 10,423 hectares of forestland and 4,423 hectares of non-forest areas.” SAMARA — The Togliatti-based GM-AvtoVAZ plant on Monday is suspending the assembly line’s operation in connection with a summer vacation. The plant’s press service reported that the vacation will last until the end of the month. During this time, maintenance of equipment will be carried out at the plant. From August 1 the company will operate as usual. VLADIVOSTOK— The legality of the use of ships that are more than 30 years old will be checked in Russia’s Far East. Many of them with Russian crews are working at sea under the flags of convenience and belong to foreign ship owners. MOSCOW — Moscow’s Basmanny Court on Monday is expected to announce a sentence in absentia to former head of the Fargoil company, affiliated with Yukos – Spanish citizen Antonio Valdes Garcia, who is accused of embezzling and laundering of 13 billion US dollars. Earlier, during hearing of the sides’ arguments the prosecutor asked the court to give him a sentence of 13 years imprisonment in a tight security penal colony. According to the public prosecutor, the defendant’s guilt has been proven in full and confirmed by the case materials. MOSCOW — The Federal Air Transport Agency ( Rosaviatsia) has either suspended or withdrawn licenses of several domestic airline companies, including "Moskovia", Rosaviatsia told Itar-Tass. “Moskovia” had its license suspended because of worsened basic transportation and financial economic parameters which affected safety of flights and infringed on consumer rights; the Taganrog Aviation Scientific- -Technical Complex had its license suspended because of the absence of normally operating aircraft, Rosaviatsia said. Russia criticises West's backing of Libyan rebels Jul 2011 08:52Source: reuters // Reuters MOSCOW, July 18 (Reuters) - Russia on Monday criticised the United States and other countries that have recognised the Libyan rebels' National Transitional Council as a legitimate government, saying they were taking sides in the civil war."Those who declare recognition stand fully on the side of one political force in a civil war," Russian Foreign Minister Sergei Lavrov told reporters. (Reporting by Steve Gutterman, writing by Guy Faulconbridge, editing by Tom Grove) Russian, UK military chiefs to discuss cooperation prospects GOOGLE TRANSLATION of Staff of Russia and Britain will meet in Moscow on July 18July 18, 2011, 12:19Head of General Staff of the Armed Forces of Russia, Army General Nikolai Makarov on July 18 will meet in Moscow with the Chief of the Defence Staff of the UK armed forces General David Richards, reported the press and information service of the Ministry of Defense of Russia.‘It is planned to review the status and prospects of military cooperation between the defense ministries of both countries in a joint work plan’ - said the statement.It is noted that a working visit to Moscow starts Richards on July 18. During his visit to Moscow, Richards will visit the fifth separate motorized rifle brigade stationed in Alabino (Moscow region), where he will visit a field firing class.On July 20 British military delegation will leave for St. Petersburg, where Richards will meet with the Western Military District, the statement reads. The visit will end on July 21, according to Interfax.Medvedev starts visit to Germany 18/07/2011MOSCOW, July 18 (RIA Novosti)Russian President Dmitry Medvedev is starting a two-day visit to Germany on Monday.Medvedev leads a delegation of over 20 ministers, top officials and chief executives of major Russian companies. He is heading to Hanover to hold intergovernmental consultations and assess bilateral relations on the whole.The Russian head of state is also expected to meet with businessmen and attend the Russian-German public forum Petersburg Dialogue.The German delegation is led by Chancellor Angela Merkel, who will meet with Medvedev on Monday on the eve of the main agenda.Russia and Germany have drafted a package of 12 documents to be signed during the consultations.The sides will in particular discuss establishing a fund to support Russian small businesses. Energy issues are also on the agenda: Germany may need more Russian natural gas after it implements its plan to give up its nuclear power industry by 2022 following the Fukushima accident in Japan.Bilateral trade in 2010 grew over 30% to $51.8 billion, and the Kremlin said the pre-crisis level of $60-70 billion may be reached soon.02:25?18/07/2011ALL NEWSSt Petersburg Dialogue to broaden RF-Germany society cooperation. Tass 146a WOLFSBURG, July 18 (Itar-Tass) —— The 11th session of the Russian-German public forum St. Petersburg Dialogue will promote a deeper mutual understanding between the civil societies in Germany and Russia, the forum’s German co-chairman Lothar de Maiziere told a press conference on Sunday before the opening ceremony of the forum. “We have used this year after the 10th session of our forum to seek for new types and a new content of cooperation. You will witness the results of our contemplations at the forum, which will be opened today,” De Maiziere said. The German co-chairman of the forum expressed hope that this “will be an interesting event.” “Our major goal is to discuss such issues, which are interesting for both our countries,” De Maiziere said. The countries “are expected to discuss the issues of migration and integration,” De Maiziere said. The forum will focus on environmental protection and will discuss demographic problems in the next year. The forum organizers succeeded “to find quite authorized partners” to participate in the meetings of the working groups, De Maiziere said. The Russian-German youth parliament will have a session simultaneously with the St. Petersburg Dialogue forum. The youth parliament should promote the development of fruitful contacts between young generations in Russia and Germany. “We are very interested to find what young men and women in the countries are thinking and what tasks concern them,” De Maiziere underlined. 04:21?18/07/2011ALL NEWSMedvedev, Merkel to discuss RF-EU ties, Middle East, North Africa. Tass 5 MOSCOW, July 18 (Itar-Tass) —— A visiting Russian President Dmitry Medvedev and German Chancellor Angela Merkel will discuss Russian-EU relations, including a European missile defence shield, as well as the situation in the Middle East and North Africa in the German city of Hannover on Monday, Russian presidential aide Sergei Prikhodko told Itar-Tass on Sunday. “The Hannover summit will focus on European security, including the creation of a missile defence shield in Europe, the Russia-NATO Council, the problems in the development of Russian-EU relations among a broader scope of international issues, which are debated regularly at Russian-German political negotiations,” he said. Speaking on European problems, Prikhodko noted that “Dmitry Medvedev will ask Angela Merkel about her position on the financial situation in several EU countries.” Meanwhile, the leaders will discuss “the development of the situation in North Africa and the Middle East and several other regional problems, including the Middle East peace process and the Iranian nuclear program.” “Germany’s presidency in the UN Security Council this July makes the negotiations particularly topical,” he elaborated. The leaders of the countries will also discuss the preparatory work to next summits of the G-8 and the G-20, in which Russia and Germany are member countries. 05:40?18/07/2011ALL NEWSMedvedev, Merkel to discuss higher RF gas supplies via Nord Stream. Tass 6 MOSCOW, July 18 (Itar-Tass) —— Russian President Dmitry Medvedev and German Chancellor Angela Merkel will discuss higher Russian gas supplies to Germany at Russian-German interstate consultations, which will be held in the German city of Hannover on July 18-19, Russian presidential aide Sergei Prikhodko told Itar-Tass on Sunday. “Since German partners are interested in the issue, I believe that higher Russian gas supplies to Germany will be discussed,” he said. “Since Germany decided at the state level to halt the national nuclear industry by 2022, new vistas open up for a broader cooperation in this sphere, including in developing the prospects for higher Russian gas supplies through the Nord Stream pipeline, which will be launched in October 2011,” the presidential aide said. The energy issues will be high on the agenda of a Russian-German summit in Hannover, Prikhodko said. Germany remains the largest buyer of Russian gas (39 billion cubic meters of gas in 2010). Prikhodko called investment cooperation among other issues on the agenda of the negotiations. Germany has made 10.4 billion dollars of investments in Russian economy in 2010 and Russia has made 4.66 billion dollars of investments in Germany in the same year. “The leaderships of the countries focus on a broader industrial and technological cooperation that meets the tasks for economic modernization that Russia is seeking for,” the Russian presidential aide said. “Joint projects are being successfully implemented in such promising spheres, as energy efficiency and energy saving, high-technological industries, including machine building, the production of medicines and medical equipment,” he said. “The countries give a close attention to the priority projects under the Partnership for Modernization concept, cooperation in scientific research and innovations, development of business cooperation in strategic alliances of Russian and German companies, for instance, RZD and Siemens, KamAZ and Daimler, as well as the support to small and medium businesses,” Prikhodko recalled. Describing Russian-German relations as unproblematic, the presidential aide called the level reached in trade and economic relations as “a solid foundation” for further cooperation. In 2010 the bilateral trade went up by a third against 2009 to reach 51.8 billion dollars. In January-April 2011 the bilateral trade went up 37% against the same period in the previous year to make 20.9 billion dollars. “With the current pace to be kept the trade may reach a record pre-crisis level of 2008 at 60-70 billion dollars by the yearend,” Prikhodko underlined. R?sler welcomes mooted Gazprom expansion: 18 Jul 11 09:07 CETGerman Economy Minister Philipp R?sler would welcome increased investment by controversial Russian gas giant Gazprom - a topic for Chancellor Angela Merkel's meeting with Russian president Dmitri Medvedev on Monday. Despite public misgivings about such business, R?sler told the Financial Times Deutschland (FTD) Gazprom would get a warm welcome from Germany’s business and economic top ranks. “Openness to foreign investors is one of the reasons of our economic success in Germany,” he said. “In principle I therefore welcome it when a Russian business like Gazprom is ready to become more involved in the German gas market.”Last week German energy giant RWE said it would work towards closer cooperation with Gazprom, with the CEOs of both companies signing a declaration to this effect on Thursday. The companies intend to negotiate forming a joint venture which would handle the currently-owned or to-be-built coal and gas power stations not only in Germany but also the UK and Benelux countries. A potential purchase of RWE shares by Gazprom is also being discussed, the FTD said on Monday. Der Spiegel reported over the weekend that Merkel and Medvedev were set to discuss the planned cooperation during Monday’s governmental consultation meeting in Hannover. The FTD said that there was significant opposition to the idea within local governments of districts where RWE is based.Yet R?sler said there was great need for investment in Germany. “We stand before great challenges over the next few years, in order to manage the change in energy use,” he said, referring to the plan to make Germany nuclear free by 2022. “Therefore we need above all, new capacity with gas power stations. It could be helpful if Gazprom becomes involved.”Russia is already Germany’s most important gas supplier, accounting for 39 percent of Germany gas imports last year, according to the FTD. Former Chancellor Gerhard Schr?der controversially took a board job with a Gazprom subsidiary company not long after leaving office, during which he maintained notably friendly relations with then Russian President, now Prime Minister Vladimir Putin. He has since taken up a seat on the board of Russian oil company TNK-BP and was recently in the frame for a Gazprom supervisory board position. The Local/hcGrowing energy ties set tone for Merkel-Medvedev talks leaders of Russia and Germany will hold a joint cabinet meeting this week amid growing German dependence on the gas-rich country due to Berlin's recent decision to scrap nuclear power.German Chancellor Angela Merkel will host the 13th annual such get-together Tuesday with Russian President Dmitry Medvedev in the northern city of Hanover joined by major business delegations from both sides.The so-called government consultations were launched with the aim of deepening ties between the wartime foes and advancing the "modernisation" of Russia after the fall of communism.Trade has exploded during that time despite criticism of Moscow's human rights record and accusations that Moscow uses state-controlled energy giant Gazprom for political purposes.The close relationship was underlined Thursday with the announcement of an envisaged strategic tie-up between Gazprom and Germany's number-two utilities group RWE to construct power plants in Europe.When asked if Berlin would promote such deals with foreign firms to meet its energy needs as it scraps its nuclear reactors by 2022, government spokesman Steffen Seibert said it was up to firms to plot their own strategy.But he acknowledged: "We will need additional power plants, particularly gas-fired ones, to close the gap left by the elimination of nuclear power plants."Weekly newspaper Die Zeit writes in its current issue that key partners such as France, Britain and the United States, already sceptical about the nuclear phaseout, are uneasy about greater German reliance on Russian gas.Medvedev will arrive for an informal dinner with Merkel late Monday ahead of a welcome by a military guard Tuesday at a Baroque garden ensemble.More than a dozen agreements on economic and environmental cooperation are to be signed, as well as business deals "covering the range of German-Russian cooperation," a German source said.Germany is Russia's most important single trading partner. Russian exports to Germany reached 31.8 billion euros ($45.0 billion) last year with 26.4 billion euros' worth of goods going the other way.The senior official, who spoke on condition of anonymity, said the talks would also cover "unresolved" human rights cases including the murder of reporter and activist Natalya Estemirova.Germany, which currently holds the presidency of the UN Security Council, also hopes to convince Russia to drop its opposition to action against Syria over its bloody crackdown on protesters.Berlin would also like to see Moscow toughen sanctions against Iran over its disputed nuclear programme.Merkel, who grew up in communist East Germany, enjoys a warmer relationship with Medvedev than she did with his predecessor, current Prime Minister Vladimir Putin, who served as a KGB officer in East Germany in the 1980s."I think Putin reminds her of the Stasi (secret service) people with whom she had her problems in the GDR," Russia expert Alexander Rahr of the German Council on Foreign Relations told AFP. "She has sort of pinned her (modernisation) hopes for Russia on Medvedev."On Saturday, the jury behind a prominent German political prize bowed to mounting pressure and reversed a decision to honour Putin this year.A spokesman for Putin, who was not to attend the Hanover talks, insisted the move would not harm bilateral ties.Fyodor Lukyanov, editor of the journal Russia in Global Affairs, said the meeting would unlikely to be more than "routine" because Germany was distracted with the eurozone crisis and Russia was in political limbo."The internal political situation in Russia is unclear" because neither Putin nor Medvedev has said which of them will stand in presidential elections scheduled for March, he said."And this uncertainty is discouraging for Berlin and all other foreign partners who are tired of guessing" who will take the reins.RT News line, July 18Russia says German Quadriga jury board poorly organized has expressed its regret over the chaos in the jury board of the German Quadriga award, which had first announced Prime Minister Putin among its winners, only to withdraw the prize, ultimately deciding not to hand out? any awards at all this year. “This is most likely related to the mess plaguing the prize’s board,” Putin’s press secretary Dmitry Peskov said. Last week Quadriga, which rewards people and organizations for initiative and innovative achievements, included Vladimir Putin on the list of its 2011 winners for being a “role model for enlightenment, dedication and the public good”. However, several jury members were quick to resign in protest of the decision. To hush the scandal, Quadriga decided to cancel the 2011 award.Germans Snub Putin Before Medvedev Visit July 2011By Alexander BraterskyPresident Dmitry Medvedev will meet with German Chancellor Angela Merkel in?Hanover this week in?what could prove to?be awkward talks after a?German nonprofit group dropped plans to?honor Prime Minister Vladimir Putin.The Werkstatt Deutschland group announced Saturday that it would cancel its annual Quadriga prize because of?"increasingly unbearable pressure" over its decision to?recognize Putin for?his role in?strengthening German-Russian relations.Critics complained that the?award recognized achievements in?freedom and?democracy and?Putin has rolled back both as he led Russia during his 12 years in?power.Putin's spokesman Dmitry Peskov was quick to?say that the?flap over the?award would not influence relations between the?two countries."As for?Vladimir Putin, he's a?recipient of?multiple international awards that require no further confirmation," Peskov said, Interfax reported.He added that the?decision to?withdraw the?prize reflected the?"mess plaguing the?prize's board."Indeed, past Quadriga recipient Jimmy Wales, founder of?Wikipedia, and?Cem ?zdemir, deputy head of?the German Green party, resigned from?their seats on?the prize's board to?protest the?decision to?honor Putin.In addition, two former recipients, former Czech President Vaclav Havel and?Icelandic artist Olafur Eliasson, announced that they would give up their prizes if Putin also got one. German human rights commissioner Markus Loening also criticized the?board's choice of?Putin.The situation resulted in?the prize board deciding to?cancel this year's award altogether due to?"massive criticism in?media and?parts [of the?world] of?politics," it said in?a statement carried by?Reuters. The?group has handed out the?award since 2003 for?input in?politics, culture and?economics. Other past recipients of?the Quadriga include Turkish Prime Minister Tayyip Erdogan, his Greek counterpart George Papandreou, Soviet leader Mikhail Gorbachev and?former Ukrainian President Viktor Yushchenko.Interestingly, the?prize's vague description never explicitly says it is awarded for?advancement of?democracy, speaking instead of?"pioneering spirit through political, economic and?culture innovations."Putin was one of?four people selected to?receive the?small statue of?a quadriga, a?four-horse chariot modeled after the?one on?the top of?Berlin's Brandenburg Gate, as well as a?cash prize of?100,000 euros ($140,000), at?a ceremony on?Oct. 3, a?national holiday in?Germany commemorating the?country's reunification.Putin, a?former KGB agent who served in?Dresden in?the 1980s, has indeed boosted ties with Germany — to?the extent of?making former Chancellor Gerhard Schr?der, a?close friend, the?chairman of?Gazprom's pipeline venture Nord Stream AG.The prize's board never released details on?who voted for?Putin during the?nomination. The?20-member board includes, among others, representatives of?Bosch, Total and?Philip Morris.Yushchenko, a?bitter foe of?Putin since Putin supported his rival in?the 2004 election that led to?the Orange Revolution, has not commented on?the prize imbroglio. Neither has Gorbachev, who came out in?March to?explicitly criticize Putin for?cracking down on?democracy after years of?tacit endorsement.Merkel, who will host Medvedev for?dinner on?Monday night and?then talks Tuesday, made no public comments about the?Quadriga prize over the?weekend. She is believed to?prefer working with Medvedev over Putin, with whom she has had a?strained relationship that observers have linked to?Putin's KGB past and?Merkel's dislike for?the political system he leads.The Hanover meeting will take place on?the sidelines of?an annual summit aimed at?improving German-Russian ties. Among those scheduled to?attend the?summit is Volkswagen CEO Martin Winterkorn, whose company is fast expanding in?Russia.While economic relations can be expected to?continue to?flourish, the?withdrawal of?the Quadriga deals a?"serious blow" to?Putin given his strong ties to?Germany, said veteran rights activist Lev Ponomaryov. "He surely didn't predict such a?strong negative reaction," Ponomaryov said by?telephone Sunday.But Alexei Mukhin, an?analyst at?the Center for?Political Technologies, played down the?prize's significance and?the possible fallout of?its withdrawal to?Putin. If the?German establishment wants to?give a?prize to?Putin, they will find a?way to?do it, Mukhin said."I don't think that this situation will influence his authority at?home," he added.Putin enjoys the?highest approval ratings of?any politician in?the country, but support has slowly slipped since the?start of?this year. Thirty percent of?respondents in?a June poll by?the independent Levada Center said they were not satisfied with his performance, up 10 percent from?last year.In a?possibly indirect response to?the Quadriga uproar, Putin chose on?Friday to?justify again one of?his most controversial decisions: the?2004 abolishment of?direct gubernatorial elections that seriously decreased the?population's say in?state affairs."It might look democratic and?very good, but then I saw the?criminal elements, rising behind their backs," Putin said of?the elections."They began to?manipulate public opinion and?elected governors," he said during a?meeting with factory workers in?the Urals city of?Magnitogorsk, according to?a transcript on?the government's web site.Putin's explanation is a?noted departure from?what he said at?the time. In?2004, Putin said nothing about fighting criminals in?power, explaining instead that the?change was needed to?strengthen the?country as it combated separatists in?the North Caucasus.The awards that Putin has received from?outside Russia include a?nomination for?the Nobel Peace Prize in?2007, a?year before the?war with Georgia; the?top spot in?Vanity Fair's "most influential" list in?September 2008, a?month before the?global recession; and?Time magazine's Man of?the Year award for?2007, an?honor he shares with a?diverse group of?people from?Josef Stalin to?Pope John Paul II.Azerbaijani and Russian FMs exchange official documents on state border treaty ratification[18.07.2011 13:36]Azerbaijan, Baku, July 18 / Trend /Azerbaijani and Russian Foreign Ministers Elmar Mammadyarov and Sergey Lavrov exchanged official documents today in Moscow ratifying the treaty "State Border", which was composed between the Russian Federation and the Azerbaijani Republic on September 3, 2010, "Russia 24" TV channel reported."We stressed a high rate of development in all areas discussed by the two presidents", Lavrov said at a joint press conference with Mammadyarov.Lavrov said that the border treaty became effective alongside an agreement on water resources in the Samur River."The signed agreements create favorable conditions for our regional cooperation in all areas", Lavrov said.Do you have any feedback? Contact our journalist at trend@trend.azAzerbaijani FM deliveres response to Russian President's proposal on Nagorno-Karabakh[18.07.2011 13:36]Azerbaijan, Baku, July 18 / Trend /During his visit to Moscow Azerbaijani Foreign Minister Elmar Mammadyarov delivered a response to Russian President Dmitry Medvedev's proposal on Nagorno-Karabakh, Russian Foreign Minister Sergey Lavrov was quoted by "Russia 24" TV channel as saying.Russian Foreign Minister Sergey Lavrov delivered Russian President Dmitry Medvedev's proposals and a message on Nagorno-Karabakh to the Azerbaijani and Armenian Presidents Ilham Aliyev and Serzh Sargsyan on July 8."Russia helps the countries to look for solutions within the OSCE, the U.S and France," Lavrov said during a joint press conference with his Azerbaijani counterpart.Azerbaijani Foreign Minister thinks that not all depends on Azerbaijan in the process of negotiations."We have to wait for Armenia's response on the same proposals," Mammadyarov said. "But we think that there is progress in negotiations. We are moving gradually to the point where everyone will understand that the current situation does not meet anyone, including our neighbors."Mammadyarov said that the stability is important for the region, especially, Azerbaijan and Armenia.The conflict between the two South Caucasus countries began in 1988 when Armenia made territorial claims against Azerbaijan. Armenian armed forces have occupied 20 percent of Azerbaijan since 1992, including the Nagorno-Karabakh region and 7 surrounding districts.Azerbaijan and Armenia signed a ceasefire agreement in 1994. The co-chairs of the OSCE Minsk Group - Russia, France, and the U.S. - are currently holding the peace negotiations.Armenia has not yet implemented the U.N. Security Council's four resolutions on the liberation of the Nagorno-Karabakh and the surrounding regions.Do you have any feedback? Contact our journalist at trend@trend.az12:32?18/07/2011ALL NEWSAzerbaijani FM gives Aliyev’s response to Medvedev Karabakh proposal. Tass 145 MOSCOW, July 18 (Itar-Tass) — Azerbaijani Foreign Minister Elmar Mamedyarov has given Azerbaijani President Ilkham Aliyev’s answer to Russian President Dmitry Medvedev’ s proposal on the Nagorno-Karabakh conflict, Russian Foreign Minister Sergei Lavrov said. In his meeting with the Azerbaijani foreign minister on Monday, Lavrov said, “After the meeting of three presidents in Kazan on June 24 Dmitry Medvedev instructed me to give his additional proposals to Baku and Yerevan. I did this. Today Elmar Mamedyarov has given a response from the Azerbaijani president.” Russia, Azerbaijan to discuss breakaway Karabakh settlement 18/07/2011BAKU/MOSCOW, July 18 (RIA Novosti)Russian Foreign Minister Sergei Lavrov will discuss the Nagorny Karabakh settlement with his Azerbaijani counterpart Elmar Mamedyarov in Moscow on Monday.Nagorny Karabakh, a breakaway region on Azerbaijani territory with a predominantly ethnic Armenian population, has been at the center of a bitter conflict between Azerbaijan and Armenia.In early July, Lavrov handed Azerbaijan Moscow's conflict settlement proposals. Similar proposals were handed to Armenia earlier.Karabakh has remained under Armenian control since the late 1980s, when the region claimed independence from Azerbaijan to join Armenia. The conflict is estimated to have left more than 30,000 people dead on both sides between 1988 and 1994.The OSCE Minsk Group, comprising Russia, France and the United States, has mediated the conflict for many years without much progress.Shootouts frequently occur on the border between Azerbaijan and Nagorny Karabakh, with Baku and Yerevan continuing to accuse each other of violating the ceasefire agreed in 1994.At Monday's meeting, Russia and Azerbaijan will continue jointly seeking ways out of the Karabakh crisis and will also touch upon bilateral cooperation.The ministers will exchange instruments of ratification for the state border treaty.02:43?18/07/2011ALL NEWSRussia, Azerbaijan FMs to discuss Karabakh peace process in Moscow. Tass 9 MOSCOW, July 18 (Itar-Tass) —— Foreign Ministers of Russia and Azerbaijan Sergei Lavrov and Elmar Mamedyarov will discuss the Nagorno Karabakh peace process in the face of new proposals from Russian President Dmitry Medvedev here on Monday. The Russian foreign minister visited Baku and Yerevan on July 8. He handed over to Ilham Aliyev and Serzh Sargsyan the messages, which spelled out the Russian presidential initiative seeking to settle the Karabakh conflict. The sides pledged to study the documents and to give an answer soon. At the meetings in Armenia and Azerbaijan Lavrov noted that Medvedev “is sincerely interested in the Nagorno Karabakh peace process to be successful.” The minister said with confidence that “all conditions to come to an agreement exist.” The experts recalled that on June 24 during the summit In Kazan the three presidents failed to agree on the basic principles of settlement. The diplomatic circles hope that “fresh ideas of the Russian leadership will help promote the peace process and put it on the right track.” Along with the Karabakh problem Lavrov and Mamedyarov will discuss the entire scope of relations between the countries. “They will exchange the instruments of ratification of the Russian-Azerbaijani Treaty on the State Border and will sign a plan of consultations between the foreign ministries for the second half of 2011 and 2012,” a diplomatic source in the Russian Foreign Ministry said. The Azerbaijani foreign minister is expected to meet with Deputy Prime Minister, Presidential Representative in the North Caucasus Federal District Alexander Khloponin and Federation Council Vice-Chairperson Svetlana Orlova. July 18, 2011 10:25Azeri foreign minister to discuss Karabakh issue in Moscow. July 18 (Interfax) - On Monday, Russian Foreign Minister Sergei Lavrov met with his Azeri counterpart Elmar Mammadyarov, who is in Moscow on a formal visit. "The talks between the foreign ministers will focus on the bilateral and international agenda," the Russian Foreign Ministry said. The Nagorno-Karabakh settlement process is expected to be the central topic of the visit. Last week Lavrov visited Azerbaijan and Armenia and handed over Russian President Dmitry Medvedev's new proposals regarding settlement principles."Hopefully, I will be able to bring a reply from Azerbaijan to Moscow, but expectations should not be too high," Mammadyarov said in an interview with Interfax."Firstly, one should not have any over-expectations, and secondly, we must continue the search for solutions to the remaining problematic issues in a quiet atmosphere," he said.The settlement process should be taken to a new stage, he said."And if so, then let us work over a peace agreement, because no one is removing the points of convergence, where efforts to reconcile the positions failed. They still have to be addressed in the peace agreement, and at the same time this allows us to start a conversation on the substantive part," he said.Baku is ready to start a peace dialog with Yerevan "even today," Mammadyarov said.He would not say when the settlement process could be complete.Azerbaijan sees Nagorno-Karabakh only as its territory. "For us, it is part of the Azerbaijani Republic," Mammadyarov said. He added that Nagorno-Karabakh could be granted broad autonomy. kk eb(Our editorial staff can be reached at eng.editors@interfax.ru)Russia, U.S. disagree on meat imports during WTO talks 18/07/2011MOSCOW, July 18 (RIA Novosti)Russia and the United States during the World Trade Organization (WTO) talks could not reach an agreement on meat imports, Russian Economic Development Minister Elvira Nabiullina said."There are significant disagreements on meat imports," Nabiullina said.Russia is not satisfied with WTO conditions on meat imports, such as high quotas on imports of meat and resetting a number of customs duties, which may lead to dumping on the meat market and create difficulties for domestic meat producers.Russia, the only large economy outside the WTO, has been negotiating the entry for 17 years compared to the five to seven years it has taken most member countries. However, Russia and its partners have said Moscow can join the trading club this year.01:42?18/07/2011ALL NEWSRussian Black Sea Fleet not encroach on Ukraine’s sovereignty. Tass 22 KIEV, July 18 (Itar-Tass) —— The deployment of the Russian Black Sea Fleet in the Crimea does not encroach on Ukraine’s sovereignty, Speaker of the Verkhovna Rada Vladimir Litvin said in an interview with the parliamentary television channel on Sunday. “Take a look at European countries, where US military bases are deployed,” he said. Litvin came out in favour of the development of pragmatic relations with Russia. “To speak about a perpetual friendship it means not to comprehend modern processes,” he believes. “This fact points to the unwillingness to agree about a true cooperation,” the parliamentary speaker noted. “The issues, in which we have some disagreements, we should discuss how we can overcome them. The issues, in which we have different positions, we should not seek to overpower each other, but should just live and work,” he stated. In 2010, Ukraine and Russia agreed to extend a lease contract for the Russian Black Sea Fleet in the Crimea from 2017 to 2042 in a swap for a discounted Russian gas price at 100 dollars per 1,000 cubic meters. 07/18 12:24 ? Russian border guards will not return to Tajik-Afghan border – official NEWSTajikistan hopes new deal with RF be signed in September – FM. Tass 113 DUSHANBE, July 18 (Itar-Tass) — Tajikistan hopes that a new agreement with Russia on military cooperation, including on the 201st military base and the Aini airfield, will be signed not later that in September, Tajik Foreign Minister Khamrokhon Zarifi said. Speaking at a press conference on Monday, Zarifi said, “The talks on the military base [the 201st Russian military base deployed in Tajikistan] and the use of the Aini airfield by Russia [20 kilometres west from Dushanbe] have proceeded since 2008.” According to the minister, “These problems are not easy in order to sign an agreement. The work continues at the level of experts.” “I believe that this important document will be signed during the jubilee CIS summit in September. The summit will be attended by Russian President Dmitry Medvedev.” The Tajik minister declined to comment on the details of the talks. He said, “In my view, they are being held constructively, without haste and excessive emotions.” Commenting on the payment for using the Aini airfield, Zarifi noted, “If anyone believes that all should be without charge, he is wrong. The land in Tajikistan is subject for investments and not the heritage of the Tajik foreign minister. The land costs a sight of money and it should be paid for.” At the same time, the Tajik minister said the Tajik-Russian relations “are on a good level”. “Russia is our important strategic partner and the level of our trade, economic and humanitarian partnership and security interaction proves this,” he stressed. Zarifi praised the CIS future. “This association has its pluses and minuses. But pluses are much more than minuses,” he said. “We succeeded in improving trade and economic relations. During its chairmanship of the CIS, Tajikistan prepared a concept on the Commonwealth development for the next 20 years. I’m optimist and I look forward with optimism,” Zarifi said. July 18th, 2011Arrested spy chiefs seen using Russian-connected firm against “Fidesz danger” at National Security Office All Hungary News Conservative newsweekly Heti Válasz reports that the ongoing spy case roiling Hungarian politics originated in a move by Gy?rgy Szilvásy, Lajos Galambos and Sándor Laborc to use a Russian-connected firm to “filter out” Fidesz’s undercover people from the National Security Office (NBH).The weekly earlier downplayed claims that energy giant MOL or hacking was at the center of the case. Instead, the paper suggested a Russian-connected company had collected information from within the NBH with help from well-placed Hungarians.HírTV, a television station known to be sympathetic to the current government, then reported that a fourth suspect in the case was an unnamed security technology entrepreneur with Russian family members, who was also connected to Eclipse Zrt. After this, other media quickly identified this individual as László Püski, whose family company is Z?m?k Kft.11:20?18/07/2011ALL NEWSMedvedev signs law on ratifying EurAsEC antidumping protocol. Tass 98 MOSCOW, July 18 (Itar-Tass) — Russian President Dmitry Medvedev has approved ratification of the protocol on anti-dumping measures within the Eurasian Economic Community (EurAsEC). The Kremlin press service reported on Monday that the President signed the Federal Law “On Ratification of the Protocol on the procedure of provision to the authority conducting an investigation, of information containing, among others, confidential data for purposes of investigations prior to the introduction of special protective, antidumping and compensatory measures in relation to third countries.” The protocol was signed within the framework of the EurAsEC Interstate Council meeting at the level of the Heads of Government in St. Petersburg on November 19, 2010. The law on ratification was adopted by the State Duma lower house of parliament on June 28 and approved by the Federation Council upper house on July 6. The Eurasian Economic Community is an international organisation that ensures multilateral economic cooperation among its member states. The EurAsEC was founded according to the Treaty on the Establishment of the Eurasian Economic Community, signed by the presidents of the Republic of Belarus, the Republic of Kazakhstan, the Kyrgyz Republic, the Russian Federation and the Republic of Tajikistan in Astana on October 10, 2000, it is said on its website. In January 2006, the Republic of Uzbekistan joined the Community, but suspended its participation in the work of the EurAsEC governing bodies since 2008. In May 2002 the Republics of Moldova and Ukraine were granted observer status at the EurAsEC, and in April 2003 the same status was granted to the Republic of Armenia. Incorporated as an international legal body, in 2003 EurAsEC was granted observer status in the United Nations General Assembly. During its 62nd session in December 2007 the UN GA adopted the resolution “Cooperation between the United Nations and the Eurasian Economic Community (EurAsEC).” EurAsEC member states occupy a total area of 20.3 million square km. Their population exceeds 181 million. The trade turnover of the member states has increased three times since 2002, and in 2007 exceeded 90 billion US dollars. Putin Deputies May Run in December Elections, Vedomosti Reports Lyubov Pronina - Jul 18, 2011 5:54 AM GMT+0200 Prime Minister Vladimir Putin’s deputies may head his party’s lists in the regions for December elections to the Russian parliament, Vedomosti reported today, citing unidentified Kremlin and government officials. First Deputy Prime Ministers Igor Shuvalov and Viktor Zubkov as well as Deputy Prime Ministers Alexander Zhukov, Vyacheslav Volodin, Igor Sechin and Dmitry Kozak will top the lists of United Russia, Putin’s party, the Moscow-based newspaper said. To contact the reporter on this story: Lyubov Pronina in Moscow at lpronina@ To contact the editor responsible for this story: Colin Keatinge at ckeatinge@ 11:18?18/07/2011ALL NEWSAir Transport Agency suspends several airline companies. Tass 100 MOSCOW, July 18 (Itar-Tass) — The Federal Air Transport Agency ( Rosaviatsia) has either suspended or withdrawn licenses of several domestic airline companies, including "Moskovia", Rosaviatsia told Itar-Tass. “Moskovia” had its license suspended because of worsened basic transportation and financial economic parameters which affected safety of flights and infringed on consumer rights; the Taganrog Aviation Scientific- -Technical Complex had its license suspended because of the absence of normally operating aircraft, Rosaviatsia said. In June, Moskovia set an unprecedented "record" in the number of delayed flights. Almost 80 out of 240 scheduled flights were delayed. A total of 48 flights, including 47 servicing regular routes, were more than six hours late. Besides, Rosaviatsia has withdrawn licenses from "Alania", "Aviaenergo", "Novosibirsk Enterprise", "Avial NV" and "Youg Line" ( South Line) domestic airline companies three months after their licenses were suspended. RT News line, July 18Over 180 terror acts staged in North Caucasus in 2011 current situation in the North Caucasus Federal District can be characterized as tense but stable, the Russian Interior Ministry's North Caucasus branch has said. According to the police statement, despite the neutralization of a number of militant leaders, the potential terrorist threat remains high, with criminal gangs most active in Kabardino-Balkaria and Dagestan. Terror attacks have claimed the lives of 210 police officers and army servicemen in Dagestan and Kabardino Balkaria alone. A total of 184 crimes related to terrorism have been committed in the North Caucasus since the beginning of the year, the report claims. Meanwhile, this figure is still a significant improvement as compared to last year, which saw 286 acts of terror committed? during the same period.Caucasus bombings kill three Russian police officers, injure nine 18, 2011, 8:40 GMT Moscow - Three Russian policemen died and nine were injured in bomb attacks by rebels in the volatile Caucasus region on Monday, according to news reports. A patrol of paramilitary police in the Vedensky region of the Republic of Chechnya was moving through a mountainous region north of the village of Kharakha when a concealed bomb exploded. Among those killed was the platoon commander and a regional inspector responsible for anti-terrorist operations. Five of the injured were hospitalized, the Interfax news agency reported, citing army officers. The neighbouring Dagestan province also saw deadly violence on Monday with a roadside bomb killing one policeman and injuring two a residential street in the regional capital Makhachkala. The police officers were conducting a routine early morning patrol when their car was struck by the bomb made up of an estimated six kilogrammes of plastic explosives, according to a statement from authorities in Dagestan. A policeman and a civilian were injured in the blast. They were expected to recover, the statement said. The bombings followed clashes between Russian troops and rebels in Vedensky on Thursday, which left one special forces soldier dead and seven injured. Russian infantry and helicopters swept the region over the weekend in a hunt for 'terrorists,' according to news reports. Chechnya, which is predominantly Muslim, has long been a centre of anti-Russia resistance. Fighting between security forces and anti-Kremlin fighters in recent years has spread from Chechnya to other provinces in the Caucasus, particularly Dagestan and Ingushetia. Last month, the Kremlin kicked off a three-month campaign aimed at eliminating the insurgency and stepped up arrests of suspected rebels and security sweeps of areas in the region. The insurgents have fought back with roadside bombs and assassinations of police officers, and less frequently, gunfights with government forces. Two cops killed, 7 injured in Chechnya blast France-PresseMoscow, July 18, 2011Two Russian policemen were killed and seven others wounded on Monday in a blast in the wooded mountains of restive Chechnya, Interfax quoted a law enforcement official as saying.??? The incident occurred in the North Caucasus republic's Vedono region, which has been the scene of recent battles between local security forces and Islamic gunmen.Moscow has fought two devastating wars with separatists in Muslim-majority Chechnya since 1994.??? It is now battling an Islamist-fuelled insurgency there and in the neighbouring regions of the North Caucasus.Four policemen killed by bombs in southern Russia: 18 July, 2011, 10:01Edited: 18 July, 2011, 10:53 Russia's southern Caucasus have been shaken by two deadly blasts, which killed four people and wounded ten others.In the Chechen republic, two policemen were killed and seven more injured when an explosion hit a special search operation in the mountainous region.One of those killed by the blast was police squad commander.Meanwhile, an overnight blast in Dagestan has left another two policemen dead and three people wounded. The roadside bomb detonated as a patrol car was driving though the city of Kaspiysk.The blast also damaged a gas pipeline, disrupting the city's supplies.Early reports suggest that explosion was equivalent to six kilos of TNT.02:51?18/07/2011ALL NEWSSeveral policemen injured in car blast in Dagestan’s Kaspiisk. Tass 31 MAKHACHKALA, July 18 (Itar-Tass) —— A car was blasted near the city police department in the Dagestani city of Kaspiisk on Monday. According to preliminary reports, several policemen were injured in the car blast. “The explosion went off at about 2 a.m. Moscow time on Monday,” sources in the Kaspiisk law enforcement agencies told Itar-Tass on Monday. The eyewitnesses said that they were feeling a strong gas smell at the blast site. The police do not rule out that the blast damaged the local trunk gas pipeline. Emergency services are working at the blast site. The number of injured people and the blast details are being investigated. Two police officers killed in south Russia explosion - investigator 18/07/2011MAKHACHKALA, July 18 (RIA Novosti)Two police officers were killed in an explosion in the Russian North Caucasus republic of Dagestan early on Monday, an investigator said.The blast that resounded at about 02:00 a.m. Monday Moscow Time (2200 Sunday GMT) left one person injured. It also damaged a police car and a gas pipeline.An investigation is underway.Dagestan has been troubled by Islamist militancy that has spread from neighboring Chechnya, which has seen two brutal separatist wars in the past two decades.Ingushetia to install GLONASS systems in passenger transport plans to equip passenger and freighting transport, as well as transport services, with GLONASS, the Ingush government reports.The plan is being realized, a document was signed. The Ministry of Economy, Ministry of Finances and the Ingushavtotrans State Unitary Enterprise are responsible for its fulfillment.A working group headed by the chief of the Ingush government's office, Mikhail Ilezov, was formed to monitor the process.07:50?18/07/2011ALL NEWSZenith brings unique astrophysical observatory Spectrum-R in space. (Updates with more details) 18/7 Tass 64 BAIKONUR (Kazakhstan), July 18 (Itar-Tass) —— The booster Zenith-3SLBF with a unique astrophysical observatory Spectrum-R was launched from the Baikonur spaceport on Monday, Itar-Tass reported from the spaceport. The booster with the Fregat-SB upper stage was blasted off at 6.31 Moscow time on Monday. Spectrum-R is the first Russian automatic astrophysical observatory for the last 25 years that will enable the scientists to observe remote extragalactic objects in the radiofrequency spectrum of the electromagnetic waves with a super high resolution, a source in the Russian Academy of Sciences told Itar-Tass. The radio interferometry technology will enable to achieve a new unique data about the nature of the Universe, the project authors believe. An unusual orbit, which takes into account a major role of the lunar gravitation, was picked up for the space radio telescope. “This is an elliptic orbit with a rotation period of about 9.5 days and the maximum distance of 350,000 kilometers from the Earth that is to say closely to the orbit of the Moon,” the experts explained. Though the Moon is situated quite far from the observatory-satellite that is 50,000 kilometers away, however, the Moon has a weak gravitational impact on the observatory. The orbit inclination provides a high resolution of the image of a celestial body monitored in all directions. “This is a very interesting launch, because such a ‘smart’ orbit was found. Under the gravitational impact of the Moon the orbit will change its angle, thanks to which the Spectrum-R telescope will be scanning the space,” the chief of the Lavochkin Research and Production Association Viktor Khartov said. The project applies the radio interferometry. The space telescope will operate jointly with the radio telescopes on the Earth, thus creating a common system of an interferometer to receive the images, coordinates and angular movements of various objects in the Universe with a very high resolution. The project authors believe that this interferometer will be able to achieve a new unique data about the nature of the Universe. “We will be able to observe very remote parts of the Universe and to receive a highly accurate data about various galactic phenomena. The scientists in the whole world are looking forward for this,” Khartov said with confidence. All ground radio telescopes, which will be engaged in the interferometer, will receive the signals from the scanned object simultaneously with the space radio telescope. The data will be transferred from the satellite at a speed of 128 Mb per second. The data reception stations are situated in the United States (Green Bank), Pushchino outside Moscow and Australia (Tidbinbilla). July 18, 2011 11:09Russia, Kazakhstan to build joint launch site at Baikonur. July 18 (Interfax-AVN) - Russia plans to use the Baikonur spaceport until 2050 and modernize it in the course of operation, Federal Space Agency head Vladimir Popovkin told reporters at the spaceport on Monday."Russia intends to continue space launches from Baikonur until 2050, when the rent agreement expires," he said.One more launch pad of Baikonur will be modernized for Soyuz-2 rockets, he said."We have plans to send astronauts on mission onboard these rockets," he added.In addition, the Baiterek launch site will be formed together with Kazakhstan in Baikonur before 2017.te eb(Our editorial staff can be reached at eng.editors@interfax.ru)July 18, 2011 12:01Vostochny spaceport to test new technologies - Federal Space Agency. July 18 (Interfax-AVN) - Russia has no alternative to the Baikonur spaceport it rents from Kazakhstan and will have no such alternative in the near future, Federal Space Agency head Vladimir Popovkin told reporters at the spaceport on Saturday."We must be frank: There is no alternative to Baikonur now and there will be none in the foreseeable future," Popovkin said.The new Vostochny spaceport in the Amur region will primarily test prospective rockets, he said. "Vostochny will be testing future technologies," Popovkin added.A number of problems need to be solved for launching manned spaceships from Vostochny, he said."First of all, the entire trajectory [of manned spaceships] will go above oceanic waters. That requires the provision of rescue service [for crews] and the placing of rescue vessels along the flight trajectory. Up to five rescue vessels are needed, and that is also a big problem," Popovkin said.te eb(Our editorial staff can be reached at eng.editors@interfax.ru)08:47?18/07/2011ALL NEWSFar East forest fire area grows three times. Tass 48 KHABAROVSK, July 18 (Itar-Tass) — The area of wildfires in Russia’s Far East has grown to 15,110 hectares, or nearly three times as compared with Sunday. The Forestry Department of the Far Eastern Federal District told Itar-Tass that “31 fires have been registered in the federal district. The most difficult is the situation in Yakutia, where there are 24 fires burning at an area of 10,423 hectares of forestland and 4,423 hectares of non-forest areas.” Fire fighters on Sunday managed to extinguish three major fires in Yakutia at a total area of 9,400 hectares, but there were 10 new outbreaks of fire, and the situation has become even more complicated. For comparison, as of Sunday morning, fires affected a total area of 5,500 hectares in the Republic of Sakha. In the Amur region, Chukotka, and in the Khabarovsk Territory there are relatively small fires, the situation is not alarming. According to the Far East Regional Emergencies Centre, 942 people are involved in the firefighting efforts in the Russian Far East, including more than 760 people - in Yakutia. Two helicopters of the Russian Emergency Situations Ministry (EMERCOM) - Mi-26 and Mi-8 flew to the republic on Monday morning from Khabarovsk. The Be-200 amphibious plane is already working in Yakutia. In addition, an Ilyushin Il-76 plane of EMERCOM on July 17 arrived in the capital of Yakutia from Krasnoyarsk, it will also be engaged in extinguishing forest fires. The aggravation of the situation in Yakutia has been caused by abnormal heat, as the daytime air temperatures are rising to plus 35 degrees Celsius. Last week, the President of Yakutia issued a decree declaring a state of emergency in the forests of 16 districts of the Republic of Sakha and in the Yakutsk city district. According to earlier reports, abnormally hot weather with air temperatures of up to 38 degrees Celsius in Yakutia in north-eastern Siberia has deteriorated the fire situation. A spokesman for the Far Eastern forestry department told Itar-Tass that “by Thursday morning, nine wildfires on an overall area of 324 hectares were registered in Yakutia. On Wednesday, fire fighters put out fires on an area of 895 hectares, but three new fires broke out on an area of about 400 hectares,” the spokesman said. “Difficult fire situation has developed in the Chukotka autonomous area. Here there are three wildfires on an area of 345 hectares. The minor forest fires have been reported in the Amur region,” the spokesman said and added that there were no wildfires in other regions in the Far Eastern federal district. According to the Russian ministry of natural resources, a 135-hectare forest fire is ravaging some four kilometres away from the Olekminsky wildlife reserve in Yakutia. No efforts are being taken to put out this fire. The ministry has requested the republic’s authorities to take urgent measures to keep the fire from spreading to the reserve. 08:09?18/07/2011ALL NEWSHot, dry weather makes forest fires spreading quicker in Siberia. Tass 62 KRASNOYARSK, July 18 (Itar-Tass) —— More than 30 wildfires have engulfed on 1,144 hectares of forests in Siberia. The firemen have put out 15 fires for the past day, but the area of extinguished fires went down slightly by just 197 hectares. The firemen have localized another 11 fires on 390 hectares. Most fires were reported in the north-eastern part of the Krasnoyarsk Territory on the borderline with the Irkutsk Region and in the Baikal Territory, a source in the Siberian regional emergencies center told Itar-Tass on Monday. Some 14 forest fires are raging on a total area of 905 hectares that is 125 hectares higher than a day before, a duty officer of the Krasnoyarsk forest firefighting center Alexander Kiselev said. “Major forest fires were not reported. Dry thunderstorms triggered 13 fires. Some 384 people, 10 units of machinery, four airplanes and four helicopters were involved in the firefighting efforts,” he noted. “A hot and dry weather up to 20 degrees Celsius makes the fires spreading quicker. No rains are expected in the Kezhem district of the territory soon, the weathermen reported,” Alexander Kiselev added. Most wildfires in Siberia are raging in the area, which is accessible only by aircraft rather than for an urgent ground delivery of people and machinery to the fires. Therefore, the helicopters will airlift the paratroopers to the fire sites. The aircraft of the air forest security service and the Siberian regional emergencies center has made 16 flights to airlift paratroops and machinery to the fire areas and for air patrolling for the past day. Some 851 people and 78 pieces of machinery were involved in the firefighting efforts for the past day. “No fire threat for the settlements exists,” the EMERCOM press service reported. 09:36?18/07/2011ALL NEWSLegality of use of ships older 30 years to be checked in Far East. Tass 46 VLADIVOSTOK, July 18 (Itar-Tass) — The legality of the use of ships that are more than 30 years old will be checked in Russia’s Far East. Many of them with Russian crews are working at sea under the flags of convenience and belong to foreign ship owners. “Russian sailors that are sent to work on foreign vessels, must be reliably protected both by Russian law and international conventions, including on the safety of navigation,” Chairman of the Far Eastern Regional Organisation of the Seafarers’ Union of Russia (SUR) Nikolai Sukhanov said on the results of a week-long campaign of fighting against the flags of convenience. He noted that during the campaign 24 such vessels in the ports of the Pacific coast of Russia, Japan and South Korea were checked. Only one of them had a properly issued collective agreement, approved by the International Transport Workers’ Federation. There were violations of the labour conditions, wage payment delays, low wages at other vessels. Thanks to prompt action taken by the SUR Far Eastern Regional Organisation with the help of courts, the issues of wage arrears were solved for many sailors. In the port of Nakhodka, where the SUR Far Eastern Regional Organisation is based, there are 12 ships under the flags of convenience under arrest. Fleet workers have been living in poverty on them for already two-three months, including 22 Indonesian seafarers and fishermen. Experts of the Far Eastern Regional Organisation of the SUR have made a decision to settle the problem of their repatriation back home and involve in these efforts the Indonesian Seafarers’ Union, the Embassy of Indonesia in Moscow and the Russian Foreign Ministry. The term flag of convenience describes the business practice of registering a merchant ship in a sovereign state different from that of the ship's owners, and flying that state's civil ensign on the ship. Ships are registered under flags of convenience to reduce operating costs or avoid the regulations of the owner's country. The closely-related term open registry is used to describe an organization that will register ships owned by foreign entities. The term “flag of convenience” has been in use since the 1950s and refers to the civil ensign a ship flies to indicate its country of registration or flag state. A ship operates under the laws of its flag state, and these laws are used if the ship is involved in an admiralty case. The modern practice of flagging ships in foreign countries began in the 1920s in the United States, when ship owners frustrated by increased regulations and rising labour costs began to register their ships to Panama. The use of flags of convenience steadily increased, and in 1968, Liberia grew to surpass the United Kingdom as the world's largest shipping register. As of 2009, more than half of the world’s merchant ships were registered under flags of convenience, and the Panamanian, Liberian, and Marshallese flags of convenience account for almost 40 percent of the entire world fleet, in terms of deadweight tonnage. Flag-of-convenience registries are often criticised. As of 2009, thirteen flag states have been found by international shipping organisations to have substandard regulations. A basis for many criticisms is that the flag-of-convenience system allows ship owners to be legally anonymous and difficult to prosecute in civil and criminal actions. Ships with flags of convenience have been found engaging in crime and terrorism, frequently offer substandard working conditions, and negatively impact the environment, primarily through illegal, unreported and unregulated fishing. In 2009, ships of thirteen flags of convenience were targeted for special enforcement by countries that they visit. Supporters of the practice, however, point to economic and regulatory advantages, and increased freedom in choosing employees from an international labour pool. Two missing after Russian coal mine accident: 10:10AM Monday July 18, 2011 Source: Reuters Two miners were missing in an Arctic Russian mine after an accident at a coal face, the owner, a unit of steelmaker Severstal has confirmed.Seventy-six miners working in the pit escaped immediately after the collapse on Saturday evening, which was caused by a geological event, mine operator Vorkutaugol said in a statement without going into detail.One miner was rescued a day after the collapse, Interfax news agency reported. Two more miners were unaccounted for.Russia, a major producer of thermal coal and coking coal for the steel industry, suffers regular mine accidents, often due to shoddy adherence to safety procedures.Russia's creaky infrastructure, negligence and rampant corruption were in the spotlight this week following the worst river accident in nearly three decades, when a tourist boat sunk on the Volga killing up to 129 people.The last major fatal accident occurred at the Raspadskaya mine in Kemerovo in western Siberia last year, when a methane explosion caused it to collapse, killing at least 66 people.11:39?18/07/2011ALL NEWSDoctor, deputy prison chief responsible for Magnitsky’ s death charged. Tass 112 MOSCOW, July 18 (Itar-Tass) — A criminal case has been opened against a doctor of Butyrka prison and a former deputy prison chief who supervised the Butyrka hospital block, spokesman for the Investigative Committee Vladimir Markin told Itar- Tass on Monday. Former prison doctor Larisa Litvinova, who supervised Sergei Magnitsky in prison, is facing charges of causing a patient's death through carelessness and professional negligence; her direct chief Dmitry Kratov - former deputy chief of the prison hospital block, was accused of negligence. It is not ruled out that other officials might be prosecuted if confirmed responsible, Markin said. 11:35?18/07/2011ALL NEWSCourt finds ex-head of Yukos subsidiary guilty in absentia. Tass 115 MOSCOW, July 18 (Itar-Tass) — Moscow’s Basmanny Court on Monday in absentia found Spanish citizen Antonio Valdes Garcia, former head of the Fargoil company, a subsidiary of Yukos, guilty of theft of 13 billion US dollars from the company and money laundering. Spanish citizen Antonio Valdes Garcia lives in Spain, so the trial against him was held in absentia. The authorities of that country refused to extradite him to Russia. Russian Press at a Glance, Monday, July 18, 2011 18/07/2011A brief look at what is in the Russian papers todayPOLITICSMany Russians remain unexcited about Prime Minister Vladimir Putin's All-Russia People's Front, but some are willing to vote for it anyway, according to a new poll.(Moscow Times)The opposition Party of People's Freedom appealed to a court on Friday to reverse the Justice Ministry's refusal to register it for State Duma elections in December.(Moscow Times)President Dmitry Medvedev will meet with German Chancellor Angela Merkel in Hanover this week in what could prove to be awkward talks after a German nonprofit group dropped plans to honor Prime Minister Vladimir Putin. Putin said he was "confused" by the developments.(Kommersant, Moscow Times, Moskovskiye Novosti)Acting upper house speaker Alexander Torshin does not plan to recall his initiative on the right of the Constitutional Court to block the European Court of Human Rights decisions, despite criticism.(Kommersant)Former Ukrainian Prime Minister Yulia Tymoshenko may face up to 10 years in prison for signing gas contracts with Russia in 2009.(Moskovskiye Novosti)ECONOMY & BUSINESSSpeaking at the Magnitogorsk Iron & Steel plant in the Ural Mountains, Prime Minister Vladimir Putin assured workers that Russia will not sacrifice the development of its car industry for WTO membership.(Moscow Times)The Republicans are ready to increase the limit of the U.S. state debt in exchange for a reduction of the government spending limits.(Kommersant)REAL ESTATEThe plan to expand Moscow may send housing prices up.(Vedomosti)ITVimpelCom was the first of mobile operators to start transferring cash abroad from mobile accounts.(Vedomosti)SOCIETYPresident Dmitry Medvedev held a meeting on the probe into the Bulgaria cruise shipwreck.(Rossiiskaya Gazeta)12:35?18/07/2011ALL NEWSRussian press review. (Itar-Tass World Service) 18/7 Tass 79 RUSSIA-GERMAN RELATIONS NOT TO BE AFFECTED BY CANCELLATION OF QUADRIGA PRIZE, WHICH WAS TO BE AWARED TO RUSSIA’S PRIME MINISTER The board of the German Quadriga Prize decided on Saturday to cancel the awarding of all the 2011 nominees, including Russian Prime Minister Vladimir Putin, amid a public outcry. Vladimir Putin was expected to be presented with the prize for his leadership in forging close relations with Germany. Putin’s press secretary, Dmitry Peskov, called it Germany’s “internal confusion.” Last week, the Quadriga (a prize named after a statue, which graces the Brandenburg Gate in Berlin, and presented since 2003) board officially named the 2011 winners, a number of state and public figures from foreign countries, the Nezavisimaya Gazeta newspaper writes. Russian Prime Minister Vladimir Putin was named among them. He was nominated for his merits in strengthening relations between Russia and Germany. Last Saturday, however the board cancelled its previous decision and said the prize this year will go to no one. It is quite obvious the decision followed disagreements over Putin’s nomination. According to Germany’s Frankfurter Allegemeine Zeitung, the nomination of the Russian prime minister gave rise to disaccord because of the situation with democratic freedoms and rights in Russia. So, the board took a decision to cancel the entire awarding ceremony. According to the Nezavisimaya Gazeta, the Russia prime minister was blamed for not being democratic enough. This was the essence of critical remarks from the media and the European public, such as liberal leftist people of culture, the German Greens and dissidents of the first wave. Thus, the former Czech President Vaclav Havel, who was awarded with the Quadriga Prize in 2009, said he would return his prize if the Russian prime minister is awarded with the foresaid prize. The board yielded to the pressure. The newspaper notes that there is a big gap between European democrats and liberal leftists, who are mostly people of arts and culture, and Russian government officials and general public as concerns the interpretation of the word and notion of “democracy.” It is quite obvious that European leftists have a vague idea of what is going on in Russian society, and, what is still more important, they are unwilling to have a closer look at these processes. Putin’s image has long been ruining in the West, the Moskovsky Komsomolets daily notes. February 2007 saw a radical turnaround, when Putin came down with criticism of the West at an international security conference in Munich. This is when the Rubicon in public opinion in the United States and the bulk of Europe was crossed and Putin became an entirely negative figure. “The whole thing can be explained rather by Germany’s internal problems and disaccord. It has nothing to do with our bilateral relations and is hardly likely to impact them,” Putin’s press secretary Dmitry Peskov told the Kommersant daily. When asked whether the prime minister was upset after he had been stripped of the prize, Peskov said, “This is not something to be upset about. I spoke to Vladimir Putin on Saturday. He is somewhat bewildered. But in general, I can say that this queer brouhaha has only tarnished the organization’s reputation. I don’t think now that it can be taken seriously.” COMMUNISTS HAVE CREATED PEOPLE’S VOLUNTEER CORPS TO COUNTERBALANCE PUTIN’S POPULAR FRONT Last Saturday, on July 16, Russian Communist leader Gennady Zyuganov announced the establishment of the National People’s Volunteer Corps that will be a kind of counterbalance to the All-Russian Popular Front engineered by United Russia leader Vladimir Putin. The new amalgamation’s ideology was coined by a secretary of the Communist party’s central committee and State Duma deputy delegated by the Krasnodar territory, Sergei Obukhov, writes the Kommersant. He listed people’s “foes,” such as “a humiliating state of things when an honest man is poor, while a thief if rich”, “a policy of handout of territories”, “oligarchs and their friends who have no inclination to pitch in work but prefer to sell out the riches of the great heritage from the Soviet era.” He demanded that the ‘Nationality’ column be re-introduced to Russian passports. Among other Corp’s demands he cited granting “Russians and brotherly peoples” the right to a share in national riches, the right to free education and medical services. He also urged to take measures to protect the Russian language, to “introduce proper order in the migration laws,” and impose death penalty for drug trafficking. The Communist party lacks ideas of its own, according to Alexei Chesnakov, the director of the Centre for Political Conjuncture. “Communists are indulging in loan-wording,” he told the Nezavisimaya Gazeta. In his words, the national subjects have long been cultivated by Liberal Democrat leader Vladimir Zhirinovsky. “The Communists have obviously decided to catch up with the LDPR on these matters,” he said. “Ideological feebleness of the Communists is absolutely evident.” The very idea of the People’s Volunteer Corps is nothing more but another borrowing, he said, adding that the Corps is “a pale imitation of the All-Russia Popular Front.” Analogies between the Popular Front and People’s Volunteer Corps are quite evident, the Rossiiskaya Gazeta daily writes. Both are not registered, and both admit individuals along with public organizations. Although they somewhat differ in structure. Thus, the Popular Front has regional coordination boards based on Vladimir Putin’s public reception offices, while the People’s Volunteer Corps is based on a network of independent organizations affiliated with local Communist Party branches. AUSTRIA HAS REFUSED TO EXTRADITE A FORMER ALPHA GROUP COMMANDER TO LITHUANIA The European Union has witnessed a scandal over a Russian subject, a former commander of Russia’s Alpha Group Mikhail Golovatov. The man had been wanted by Lithuania for his involvement in an attack on the Vilnius TV centre in January 1991. He was detained in Vienna but later was let to return to the homeland. On Monday, a note of protest will be handed over to Austrian Ambassador to Lithuania Helmut Koller. The Russian Foreign Ministry does not object. After Golovatov was detained in Austria, Lithuanian prosecutor Tomas Krusna said the extradition procedures might take several months, writes the Moskovsky Komsomolets. The Austrian Ministry of Justice however said the European arrest warrant was incorrectly filled and it needed more details to extend Golovatov’s custody, of which it claimed it had informed the Lithuanian authorities. Since no further data came from Lithuania, the Russian national was released. The Lithuanian authorities were over-infuriated, writes the Novye Izvestia newspaper. The Lithuanian Prosecutor General’s Office came down with a statement saying it “considers the actions taken by the Austrian competent authorities in respect of the European arrest award as a flagrant violation of European laws.” Vytautas Landsbergis, who was speaker of the Lithuanian legislature back in 1991, said the former Alpha commander had been released “under pressure from Moscow.” Golovatov’s release has triggered an all-European scandal, stresses the Kommersant. “‘In this case, Austria disregarded European solidarity in the case of utmost importance to Lithuania,” Lithuanian Prime Minister Andrius Kubilius said. Landsbergis, who is a member of the European Parliament, slammed down on Austria accusing it of violating European law and fawning upon a third country. More criticism came from Lithuanian observers. “Austria is a small but rotten country. It is a disgrace to the entire European Union,” the Delfi ports cites political scientist Vladimiras Laucius. The Russian Foreign Ministry however is quite satisfied with the outcome. “The Russian Foreign Ministry and our embassy in Vienna dispatched notes saying that Golovatov’s case was being over-politicized. They analyzed it and drew the conclusion,” a source in the Russian Foreign Ministry told the newspaper. Is WTO ready for Russian bear? CLAYTON YEUTTER | 7/17/11 9:31 PM EDT Russia is the only major trading nation that has not yet joined the World Trade Organization — even after years of negotiations with the United States and other member states. This could finally change, however, if the Obama administration can resolve long-troublesome concerns.Russia’s negotiating strategy seems to be to ignore — often with impunity — WTO rules, but to commit to follow the rules once in the organization. China had a somewhat similar strategy — which, regrettably, prolonged its membership negotiations.Yet WTO members must now wonder whether they were too easy on the Chinese — who seem determined to test the boundaries of WTO rules in areas such as indigenous innovation. This raises the obvious question: Should the WTO be as accepting today of promises from Moscow as it was of promises from Beijing?Members of Congress — 28 senators and 83 representatives — say no. In two separate letters to the administration last month, they urged U.S. negotiators to press Russia to accept international trade rules and standards before it is allowed to join the WTO.Are member nations better off having Russia in or keeping it out of the WTO? Bringing Russia in makes it subject to WTO dispute settlement should it not fulfill its accession commitments. That means the United States and others could ultimately retaliate if they’ve suffered injury because of Russia’s actions — or inactions.But WTO dispute settlement often takes several years, so it’s not an ideal response to blatant rule violations. The better course is to fix problems up front, before membership is granted.In recent years, Russia has abrogated bilateral agreements on meat imports. It also has sought to justify other protectionist import barriers on the basis of bogus health concerns. U.S. poultry and pork exports to Russia have plummeted.Meanwhile, in its efforts to become the principal supplier of natural gas to Western Europe, Russia has implemented heavy-handed measures against neighboring countries. Its protection and enforcement of intellectual property rights are loose at best, with major piracy operations allowed to flourish. Other examples abound.Prime Minister Vladimir Putin recently told Reuters, “Why the hell should [the WTO] take us in if we are implementing all the rules?”The obvious retort: Why the hell should the WTO take in anyone who is not implementing the rules? Not many organizations grant memberships to applicants who base their candidacy on dubious conduct.Russia seems to assume that, because it is a major global power, it is entitled to WTO membership. But that’s a fundamental misreading of WTO accession procedures. For more than 60 years, the General Agreement on Tariffs and Trade/WTO membership has been awarded to countries that agreed to abide by the institution’s rules. The WTO, thankfully, is not the United Nations!There would be shortcomings to keeping Russia out, however, because then its actions in global trade would be unpredictable and subject only to self-discipline.On balance — as with China — I’d rather see Russia in than out. If, that is, the WTO accession terms can effectively address longstanding trade disputes with the United States and other nations.Once these issues are resolved, Russia would face two remaining hurdles. The first is that the WTO operates by consensus, meaning any member nation can block accession.The WTO already has 153 members, and Russia’s relationship with at least a few of them is cool at best. The Republic of Georgia, for example, has blocked formal meetings of the WTO working party on accession since 2005. Russia needs to patch up that relationship and others that are similarly challenging.A second hurdle is Washington’s Jackson-Vanik Amendment, which requires the annual renewal of permanent normal trade relations with our trading partners, based on satisfactory emigration and other human rights policies.Though Colombia may well be our best friend in South America, the pending free trade agreement with that country is still in jeopardy because of labor union opposition based on human rights concerns. U.S. unions could have similar concerns if and when the Obama administration asks Congress to grant normal trade relations to Russia.U.S. conservatives are likely to share those concerns — and undoubtedly add a few of their own. That means the administration must work vigorously and diligently to rally public support for trade relations with Moscow.Over time, the world should benefit if Russia is granted WTO membership — and Russia would very likely benefit more than anyone. So this needs to happen. Russia could make it far easier simply by following WTO rules — before, during and after accession.The essence of those rules is that the world’s trading nations must treat each other fairly, at all times. That’s not an unreasonable request of any nation.Clayton Yeutter served as U.S. trade representative in the Reagan administration, and as agriculture secretary under President George H.W. Bush.Read more: looks to NASA: 18 July, 2011, 05:49Edited: 18 July, 2011, 06:01 Ivan Cheberko (Baikonur) After the successful rocket launch from Baikonur Cosmodrome, the head of Russia’s Federal Space Agency (Roscosmos), Vladimir Popovkin, shared with reporters his vision of the future of Russia’s rocket and space industry. “We are working to attract private business to the space industry,” said Popovkin. “Perhaps, a number of enterprises will be re-established as a private-public partnership.” He did not go into detail about the reform, explaining that the concept is not yet fully developed.A staff member of Roscosmos company also present at Baikonur told Izvestia that at a recent meeting Popovkin had explained his idea of a private-public partnership in quite a bit of detail. “The idea was that because the government is investing significant funds in space projects, it is necessary to create conditions for the private sector’s involvement,” said Izvestia’s source. “As an example, he had cited projects for the creation of the GLONASS system and the Vostochny Cosmodrome (Eastern Seaport): we are talking about state investment in these projects in the amount of dozens of billions of rubles a year (for 2012, Roscosmos asked for 42 billion rubles as funds for the GLONASS program – Izvestia).”While speaking of promising projects, Popovkin had cited a flight to Mars as an example which, according to the head of Roscosmos, could also be funded by large private business. The idea to interest the private business sector in large-scale space projects is actively being promoted by the current NASA administration, headed by Charles Bolden. However, the main focus of the NASA leadership slightly differs as it suggests that the state will cease funding large-scale space projects altogether, allowing private companies to execute them instead. In February of this year NASA issued a 970-page publication titled “The Future is Mars. Brought to you and funded by Corporate America”. In essence, it is a proposal for large companies to fund a Mars mission, with a budget of $160 billion.“The human mission to Mars can be marketed and sold as the ultimate sports and reality TV extravaganza with the conquest of an entire planet as the ultimate prize,” reads a paragraph dealing with the marketing aspect. “The $160 billion can be realistically obtained from marketing, advertising, sponsorship, the sale of exclusive broadcast and naming rights. How much would Microsoft, for example, pay to have the first spaceship to Mars be named Microsoft Explorer? Or Google to have it named Google Search Engine? $10 billion or $20 billion? How much money will the sale of broadcast rights, logos and merchandise raise?” Apparently, the head of the Russian Federal Space Agency shares NASA’s ideas about the future of space exploration and the growing role of private business in its funding. According to the executive director of the space technologies and telecommunications cluster of the Skolkovo Foundation, Sergey Zhukov, in certain aspects, Russia’s private business is today already able to participate in space programs.“As an example, we could cite the Gazprom Space Systems company, which has already created a telecommunications system based on its own satellites and is now creating its own Earth remote sensing system (RSS),” says Zhukov. “The two areas, telecommunications and RSS, are most attractive for private companies. Also the navigation segment is actively being developed by private entities. Speaking of prospects, I think that Russia’s private business is able to take on certain projects, such as the creation of ultra-light launch vehicles.”The possibility of a private-public partnership in large-scale space exploration projects, according to Sergey Zhukov, is unclear due to the position of major space corporations. In order to improve the situation, state-owned companies need to make some concessions. There have already been instances when interested private companies approached major state-owned enterprises with project proposals, but the latter did not show sufficient flexibility. “You can give us the money and not worry about anything else” was the gist of the conversation. Therefore, successful application of the private-public partnership experience in the rocket and space industry calls for the improvement of the legal foundation, which needs to outline the rules of the game, creating conditions for a successful implementation of the idea of a private-public partnership.Brotherly Love Recent Church Council in Kiev Highlighted the Complex Relationship between Ukrainians and Russians By Andrei Zolotov Jr. Russia Profile 07/15/2011 The latest meeting of the top Council of the Moscow-aligned Ukrainian Orthodox Church (UOC) produced little tangible result, but nonetheless stirred deep passions among believers and underscored rising tensions along the spiritual frontier between Orthodox and Western Christianity. KIEV, Ukraine/On the eve of the Council meeting, rumors circulated that the 75-year-old head of the UOC, Metropolitan Vladimir of Kiev and All Ukraine, would retire, with his ambitious young secretary Archbishop Alexander (Drabinko) of Pereyaslav-Khmelnitsky and Vishenyovoe poised to take over. In the last few days Kiev has witnessed numerous celebrations of Metropolitan Vladimir’s 45th year as a bishop, and he received a Hero of Ukraine award from President Victor Yanukovich. Metropolitan Vladimir’s personal authority has ensured that his church enjoys a good deal of independence from both the Ukrainian government and Moscow, and has helped keep the peace among various interest groups within his Church. But he is visibly frail.The tension surrounding his successor was heightened by the fact that behind any church-related discussion in Ukraine looms the politically and emotionally loaded issue of relations with Moscow and the schism in Ukrainian Orthodoxy itself. The UOC’s decision to hold its own Council reinforced its autonomy, with Moscow church officials reportedly only finding out about the meeting on the Internet.? With Moscow or Against Moscow?“The reason for a lot of the worry is that the majority of members of the Ukrainian Orthodox Church of the Moscow Patriarchate refuse to accept the idea that they should be torn off from the Mother Russian Church,” said Archbishop Ionafan of Tulchin and Braclav. “A group of clerics and laymen within the church has been trying to push this issue for 20 years now, and people feel like they are living on a volcano.”Finding a majority view in these church debates is tough. And rightly so, because church tradition insists that matters of principle should be decided not by a majority, but through either a revelation of the truth or by consensus. But there are clearly opposing schools of thought within the Ukrainian Orthodox community on unity with Moscow. The pro-autocephalous movement, which emerged in Ukraine in the early 20th century, was reborn in the late 1980s and early 1990s and led to the appearance of two church structures which remain unrecognized by the International Orthodox Christian community: the Kiev Patriarchate and the Ukrainian Autocephalous Orthodox Church. Together, these churches account for about 4,000 parishes, or at least one quarter of all Orthodox communities in Ukraine. For Ukrainian nation builders, having their own church, which is not linked to Moscow, is one of the main symbols of national independence. Creating “a unified local Ukrainian Church” was an unfulfilled idée fixe of the former President Victor Yushchenko. As for the current President Victor Yanukovich, there were some expectations in the beginning of his term that he would favor the UOC – the Church he is a member of and with whom his Party of the Regions has extensive ties in Eastern Ukraine. But quite soon his religious policy became much more balanced.Last but not least, the recent election of the young and well-educated Supreme Archbishop Svyatoslav (Shevchuk) as the new head of the third largest Ukrainian religious institution, the Ukrainian Greek Catholic Church, is a major challenge to the fragmented Orthodox Christians in the country. The largest branch of Byzantine-rite Catholicism, the Ukrainian Greek Catholic Church, considers itself to be the heir to Prince Vladimir’s Kiev baptism in 988 and has a great deal of public authority in the country.Self-Rule and AutonomyThe UOC received the status of “self-rule with the rights of broad autonomy” in 1990. This means that it installs its own bishops and elects a primate, who has almost all the prerogatives and regalia of the head of an independent church. It has its own Synod and can convene its own Councils, but remains part of the framework of the Moscow Patriarchate. But this position has been somewhat shaken recently. Unlike his predecessor, Patriarch Kirill has launched an active Ukraine policy. He visits the country several times a year and is strongly promoting his concept of “Russky Mir” (Russian World) – the unity of people that comprised the former Russian Empire under the aegis of the Russian Orthodox Church. Without questioning the autonomy of the UOC, he has declared himself much more than its figurehead. At the same time, some UOC members and hierarchs have begun to speak about the need to return to the Soviet-era system of running the Church in Ukraine.“Over the past 20 years, people in the UOC got the impression that they decide themselves what to do,” said the Secretary of the Synod of the unrecognized Kiev Patriarchate Bishop Yevstraty (Zorya). “Now this is coming up against the personality of Patriarch Kirill, who is a centralizer in character. Metropolitan Vladimir and the UOC have for over one and a half decades tried to create an image of a Ukrainian Church, not a Russian Church in Ukraine. Patriarch Kirill has leveled all this work,” he said.The Russky Mir concept has been largely rejected in Ukraine, including in the UOC. “We cannot call upon people to return from the schism into the canonical Ukrainian Church, while at the same time call on them to enter the Russian world – that’s nonsense,” said a high level UOC representative, who wished to remain anonymous.The Council IntrigueIt was in this context that the reportedly weakening health of Metropolitan Vladimir unleashed a chain of actions both real and rumored. On June 14, the UOC Synod decided to expand its membership from seven to ten people. This board of senior bishops, from whose ranks the temporary head is elected when the Metropolitan of Kiev dies or retires, co-opted three influential Ukrainian bishops: Archbishop Alexander (Drabinko), the 34-year old longtime secretary to Metropolitan Vladimir, recently appointed head of the UOC External Affairs Department; Metropolitan Pavel (Lebed) of Vyshgorod and Chernobyl – the vicar of the preeminent Kiev Monastery of the Caves, one of the founders of the Party of the Regions and a deputy of the Kiev City Council, he is also a man with a very dubious reputation here; and finally Metropolitan Hilarion (Shukalo) of Donetsk and Mariupol, a powerful bishop from the region intimately connected to the current Ukrainian authorities. All three have thus positioned themselves as potential successors to the Kiev See. Two weeks later, on June 28, the Synod met again and decided to call the UOC Council, which includes all Ukrainian bishops plus elected representatives of clergy and laity for July 8. The second such Council in UOC history was called in ten days, and elections had to take place within three or four days – terms which were absolutely unrealistic for any decent nomination and election process as well as for an open discussion of the agenda. In a similar vein to Russian State Duma Speaker Boris Gryzlov’s famous comment that “the Parliament is not a place for discussions,” the UOC Press Secretary, Archpriest Georgy Kovalenko, said at a press conference here that “the Council is meeting not for discussions, but to adopt concrete decisions on a concrete set of issues.”Clearly, such a statement did not dispel concerns, despite the fact that the Council was immediately renamed a Jubilee Council, saying that its main task was to mark the 20th? anniversary of independence for the Ukrainian Church and state, as well as the 45th anniversary of Metropolitan Vladimir’s consecration as bishop.According to several sources in the UOC, it was the power struggle within the church that was the main reason the Council was called, because it was utterly necessary to immediately legitimize the expansion of the Synod. But Archbishop Ionafan considers such a statement “an autocephalist trap.” He stressed that according to the UOC Statutes, Ukrainian bishops elect the Metropolitan of Kiev from among all the bishops of the Moscow Patriarchate. This point gave rise to speculation that both the patriarch’s closest aide Metropolitan Hilarion (Alfeev) of Volokolamsk, as well as the Patriarch himself, are eligible to be elected to the Kiev See when it becomes vacant. And these speculations, in turn, are stirring fears that “Moscow’s hand” is ready to take away the independence of the Ukrainian Church.Although deriding the rumor as “stupidity,” Archishop Ionafan said nonetheless that he would have welcomed the election of Metropolitan Hilarion (Alfeev) as a “great gain for the UOC.”“I am convinced that he would have become a 100 percent Ukrainian,” he said.Collisions of the StatuteSeveral experts predicted that the Council would approve the UOC Statute, and some amendments to it, which contradicts the Moscow Patriarchate Statutes. For example the UOC statute keeps silent about some prerogatives for the Patriarch of Moscow. In response, the pro-Moscow faction led by Metropolitan Agafangel (Savvin) of Odessa and Izmail presented its amendments. Long-distance polemics ensued, involving those close to the Moscow Patriarchate, while Moscow church officials remained silent due to the delicacy of the issues.Ultimately, several days before the Council, a carefully worded letter of blessing sent by Patriarch Kirill to Metropolitan Vladimir was published. In it, the patriarch thanks the Metropolitan of Kiev for “notifying” him about the Council (something he did not have to do, but apparently nonetheless did), gives his blessing for the Council (which is not required), wishes its members “wise decisions aimed at strengthening the unity” of the Russian Orthodox Church and overcoming the divisions within Ukrainian Orthodoxy and, with a clear hint at the internal strife, wished “unhypocritical brotherly love.”According to Archbishop Ionafan, at a morning meeting of bishops, Metropolitan Vladimir took all the amendments to the Statute off the agenda and a special commission was set up to consider the amendments, under the chairmanship of Metropolitan Hilarion of Donetsk. However, after the break, the Council adopted a resolution, which approved the Statutes as of 2007 and, at the same time, all the Synod’s decisions, including those making amendments to the Statute. The decision says that the Statues take effect immediately, while the Russian Orthodox Church Statutes require that they be submitted for the patriarch’s approval.The UOC leadership is trying to underestimate the importance of the Statutes. “It is the Statutes for the Church and not the Church for the Statutes,” Archpriest Kovalenko told journalists here.Interim ResultsAlthough major contradictions were either lifted or postponed, the decisions of the Kiev Council have created a number of legal collisions that need to be resolved. The way the Council was prepared reflects serious suspicion between church authorities in Kiev and in Moscow.The appointment of Metropolitan Hilarion of Donetsk as the chairman of the commission on the Statutes also somewhat raises his stakes in the upcoming battle for the Kiev See. At the same time, the problems of moral standing and public reputation of some of the leading Ukrainian bishops could at any moment deal a heavy blow within the Church.Strategically, though, the knot of contradictions surrounding the relationship between the Ukrainian and Russian Orthodox churches is unlikely to be resolved soon, because their identities are too closely interwoven. The Russian Church sees Kiev as its motherland and traditionally underestimates the Ukrainian otherness and aspirations to freedom. At the same time, the supranational character of the Moscow Patriarchate is primarily based on the fact that it includes a Ukrainian as well as a Russian component. Without each other, the two churches might be tempted to slide toward nationalism and become more dependent on their respective governments. In Ukraine, part of the Church considers itself Russian and another part indentifies itself as opposed to Russia. Everybody understands that succeeding today from the Moscow Patriarchate, even in the most legal of possible ways, would lead to another schism within the UOC. But even without changing the present status of the UOC within the Moscow Patriarchate, the UOC leadership will inevitably try to fill its autonomy with more and more meaning. That, in turn, will be perceived in Russia and by Ukrainian Russophiles as “steps away from Moscow.”According to Russian political scientist Andrei Okara, cases when a Ukrainian figure seemingly loyal to Moscow or St. Petersburg suddenly turns away and begins to defend Ukrainian independence, occur century after century in both state and church relations. “It’s a paradigm of Russian-Ukrainian relations throughout history – since the middle of the 17th century,” Okara said. “Because Moscow wants vertical relations between senior and junior members and Kiev wants horizontal relations of equality.”The next visit by Patriarch Kirill to Ukraine is scheduled to take place in two weeks time. The story continues…Russia Profile Weekly Experts Panel: Will a Center-Right Party Led by a Billionaire Become a Game Changer in Russian Politics? by Vladimir Frolov Russia Profile 07/15/2011 Contributors: Vladimir Belaeff, Elena MiskovaLast month Right Cause, an all but defunct and already decomposing center-right liberal party cobbled together by the Kremlin three years ago, was given a new lease of life. The party elected billionaire businessman Mikhail Prokhorov as its new leader. Prokhorov is Russia’s third richest man according to Forbes magazine, with an estimated fortune of $18 billion. What is Prokhorov hoping to achieve by leading a party that has lost almost its entire support base and is currently hovering around two percent of voter support? What is the Kremlin’s objective in giving its clear backing to Prokhorov’s project?Until last month Prokhorov showed significantly less interest in politics than in precious metals, beautiful women, aqua-bikes and wild parties at swanky French skiing resorts. But he agreed to lead Right Cause after some heavy prodding by Alexander Voloshin, a former Kremlin chief of staff and the current go-to-man regarding sensitive political decisions between President Dmitry Medvedev and Prime Minister Vladimir Putin. Allegedly, Voloshin secured Medvedev’s eager blessing for resuscitating the liberal party project, while Vladimir Putin responded to the idea with an indifferent shrug of his shoulders, which is a blessing of sorts.At the party’s congress in late June, Prokhorov was elected sole leader of Right Cause. He has promised to lead the party into the State Duma at parliamentary elections on December 4 and make it the second party of power. He has even pledged to run for prime minister himself if his party is successful in the polls.In order to achieve this, Prokhorov suggested broadening the party’s base by embracing populist themes and positioning itself not as a party of Russian business, but as a party of Russian independent households, or the middle class. Prokhorov has also sought to distance the party from liberal oppositionists to the Kremlin. In turn the liberal opposition has slammed Prokhorov’s party as a Kremlin project that is meant to divert disaffected voters from backing the real opposition to the tandem’s rule.Indeed, some Russian analysts have argued that the whole idea behind Prokhorov’s party is to provide a convenient punching bag for United Russia and Putin’s Popular Front in order to maximize United Russia’s performance in the polls. Strong criticism of an opponent could be a more effective victory strategy for United Russia than focusing on the catalogue of its own achievements. And it is quite possible that Prokhorov has taken up politics precisely to provide that target.Others argue that Right Cause under a charismatic and energetic leader like Prokhorov, who has virtually unlimited financial resources at his disposal, could serve as a game changer in Russian politics by providing the Russian middle class in major urban areas with the opportunity for meaningful political participation. It would answer a brooding call for change among this disaffected group of voters who otherwise may have stayed home on election day. Indeed, Russians' attitude toward Prokhorov has improved, according to the latest survey by the Public Opinion Foundation. In July, 12 percent of those surveyed said they liked him, while in May the figure was 8 percent. Those who like Prokhorov are usually men aged 55 to 64 and people with high incomes – 19 percent of both target groups, and professionals – 18 percent of whom said they like him.? According to the July survey, 14 percent liked the fact that Prokhorov was elected head of Right Cause up by ten percent in May. At the same time, 83 percent of respondents had not heard anything about the new challenges for the party or the proposals for development of the country's political system, which Prokhorov announced at the congress. Eight percent liked his ideas and six percent did not. In a show of official support for Prokhorov, Medvedev rushed to meet him in person the day after he had been elected leader of Right Cause. Medvedev has given his approval to some of Prokhorov’s sweeping ideas, like reinstituting direct elections of mayors for Moscow and St. Petersburg. This prompted speculation that Medvedev may one day agree to lead Right Cause either as president or as a former president.What is Prokhorov hoping to achieve by leading a party that has lost almost its entire support base and is currently hovering around 2 percent of voter support? What is the Kremlin’s objective in giving its clear backing to Prokhorov’s project? Is it really aiming at providing United Russia with a convenient target for criticism? Or is it toying with providing Medvedev with a springboard for his nomination to a second presidential term despite Putin? Would the Russian urban middle class vote for Prokhorov and his party? How would the West view Prokhorov’s party against the die-hard liberal opposition of Mikhail Kasyanov, Vladimir Ryzhkov and Vladimir Milov? Would a liberal party led by a billionaire serve as a game changer in Russian politics?Vladimir Belaeff, Global Society Institute, San Francisco, CAFor a start, based on Prokhorov’s initial declarations, we cannot yet say for sure whether the party in question will even retain its name, let alone its position in the political spectrum.It is important to note that Russia already has a genuine center-right party, Vladimir Zhirinovsky’s Liberal Democratic Party, which has a stable (and growing) constituency, a clear program, a place in the electoral process and brand recognition. Whether there is room for another putative center-right party is unclear.The parties with the most in common with the old Right Cause were some Western neo-conservative parties, which in America comprise the intellectual drivers within the Republican Party. For some observers, recent developments have given Right Cause the regrettable image of a party ready to sacrifice even its beliefs (and certainly its leadership) for the sake of increased political power. This somewhat cynical interpretation is not without merit.The dictatorial authority that Prokhorov has imposed on his newly-acquired asset may be suitable to a corporate purchase, but it has very unpleasant analogies in party politics. One is reminded of the democratic centralism and leader of the party images that belong in the 20th century. A right-wing party with a dynamic and excitable leader will inevitably draw very disturbing parallels. Some wonder whether Prokhorov is completely tone deaf when it comes to politics. Some say that his intellectual interests being rather minimal, the new owner may not know enough history to recognize the questionable political image he may be creating for himself.So what did Prokhorov buy? He has discarded the old leadership and the old ideology (the political product.) What remains is a rather shaky distribution infrastructure (the regional offices) where many of the personnel may resign in disgust over the betrayal of their sincerely-held political beliefs. Not everyone is willing to sell their convictions and dignity to a billionaire, who’s most notorious acquisition before Right Cause was a basketball team in New Jersey.As to political activity, Prokhoov here again demonstrates very questionable political judgement. Other political parties – and political financial regulators – will challenge and resist the use of private billions to support a “pocket” political property. Prokhorov’s business competitors past, present and future will object to seeing their business adversary gaining political power and the ability to harm their business interests further.Furthermore, Prokhorov as a political figure will be subject to intense official and non-official scrutiny. He will have to disclose his wealth and its structure, or this will be done for him by his adversaries. Analysts consider that he has already accumulated enough negative political baggage to make himself unelectable in fair elections.There are very substantial reasons why in the West people involved in business and wealthy individuals usually do not involve themselves in public politics. The exceptions are very rare.? Prokhorov seems to be ignoring the fact that running a political party and getting elected is not like running a corporation or a basketball team. If he believes that there is no difference, then he is in for a surprise.Will the whole acquisition of a political party by a toy-collecting Russia nouveau-riche billionaire become a political “game changer?” Very unlikely. By the way, Prokhorov’s face time with Medvedev comprises a brief episode right after the acquisition. Who arranged this meeting is not publicly known. Does the meeting suggest substantial interest on Medvedev’s part? Consider this: Medvedev meets frequently with the leader of the Communist Party Gennady Zyuganov – does this fact imply that Medvedev is aligning himself with the communists? One thinks not. The same logic applies to Prokhorov’s fresh acquisition.Elena Miskova, Managing Partner, LEFF GROUP Government and Public Relations, MoscowThere is a niche for Prokhorov’s party in Russian politics. The Kremlin’s rationale for giving its backing to this political project has been in providing a political outlet for a large pool of disgruntled and disaffected urban middle class voters who will never vote for United Russia. The objective is not so much to provide United Russia with a convenient punching bag (although this would come in handy as well) as to consolidate United Russia’s social-conservative base (in the Russian sense of this term, meaning pensioners and blue-collar workers), but to capture the disaffected young, relatively affluent and socially active urbanites to prevent them from forming a serious political opposition to the regime.But filling a niche and securing the Kremlin’s backing are not sufficient for the party to do well at the polls. A lot depends on the party’s agenda, its leadership appeal and campaign tactics. It is here that serious questions remain.Prokhorov can obviously capitalize on his role as a fresh face in Russian politics (all other party leaders look ossified compared to him), his business acumen and money, his handsome looks and his intriguing status as Russia’s most eligible bachelor, but he is for all intents and purposes a political novice. Until now he has never dabbled in politics or even made a public speech (although he did well in direct discussions with workers at the Norilsk Nickel plant where he served as general manager in the 1990s). His sense in politics is untested and his ability to inspire people, although present in his corporate boardrooms, remains to be proven.Prokhorov is obviously a very talented and capable man (otherwise he would not be a billionaire) and he has proven his capacity to excel at many things at once. But there are projects where he has failed or has not been spectacularly successful. One is his leadership of the Russian National Biathlon Association – the Russian National Team under his leadership was a complete failure at the last Olympics and last year’s World Cup. Prokhorov’s party currently has two percent support according to the latest poll conducted by the Levada Center. It has a fragmented base and lacks other strong and charismatic leaders. It would be a huge feat were it to gain seven percent of the vote and make it into the next Duma. Prokhorov’s own target of 15 percent, and a second place finish, appears to be unattainable.Russia and the flight of capital investors running scared as uncertainty reigns over Russia's political future?Inside Story Last Modified: 17 Jul 2011 10:11 Dmitry Medvedev, the Russian president, has?called on business leaders this week to decide whether they support him for a second term or want Vladimir Putin, the current prime minister and former president,?back in the Kremlin.With eight months to go until a presidential election is held,?Russia still does not know who will stand for the country's highest office.So far both Medvedev and Putin are seen as contenders. But neither has made any official announcement, and the uncertainty may be affecting the country's economy.Are investors running scared?over the country's political future?Inside Story, with presenter Hazem Sika, discusses with guests: Alexander Nekrassov, a former Kremlin advisor; James Moore Junior, a former US assistant secretary of commerce for trade development; and Dimitry Babich, a political analyst with Russia Profile magazine.This episode of?Inside Story?aired from Saturday, July 16, 2011.Vladimir Putin 'asked to get Chelsea place for Kazakh President's grandson' Putin was asked to pressure Roman Abramovich to find a place on the Chelsea youth side for the grandson of Kazakhstan's President, the boy's estranged father has claimed. By Richard Orange, Almaty9:00PM BST 17 Jul 2011Rakhat Aliyev, who has been exiled from Kazakhstan since 2007, said that President Nursultan Nazarbayev contacted Putin, who was then Russia's president, to influence Mr Abramovich to favour Aisultan Nazarbayev. "I met with Abramovich in London for my son because he was interested in playing football for Chelsea," Mr Aliyev told the Daily Telegraph. "Abramovich gave him a trial and he told me, 'Sorry, tell President Nazarbayev that I can't interfere with the team's selection process. I'm like the conductor of an orchestra, and I play with the number one orchestra in world football.'" When Aisultan returned to Astana, Kazakhtan's capital, to tell his grandfather the bad news, Mr Aliyev claims he was told that Mr Nazarbayev, through his assistant, had already tried to sway the selection. "He said, 'What can I do? I have already made contact through the Kremlin'," Mr Aliyev claims. "The assistant of the president called Putin's assistant to organise this." Mr Aliyev was exiled to Austria in 2007 after falling out Mr Nazarbayev, compelled to divorce from his wife, and then sentenced in absentia to 40 years in prison, twenty for kidnapping two bankers, and another twenty were for planning an attempted coup. From exile he published a book, portraying his former father and law as a dictator who rules through a combination of fear and corruption. Aisultan Nazarbayev, now 21, goes under his grandfather's, rather than his father's surname. "That is a complete lie," he told Daily Telegraph. "I played for Kazakhstan's Under 17 team in the European championship in Wales and after the match against Wales some agent came and started to speak to my father. And later I appeared in Chelsea. It was very tough to play there, so I had another invite from Portsmouth, and at the end of the day I chose Pompey." Dr Aliyev also claimed to have got his son his place at Portsmouth FC, asking Sacha Gaydamak, the club's owner, to find a place for the boy. Sacha Gaydamak is the son of Arkady Gaydamak, a Russian-Israeli businessman who previously owned a set of mining businesses in Kazakhstan. Aisultan Nazarbayev said he had played for Chelsea's Under-16 side for three months and then joined the Portsmouth for a year. "I can confirm he was here for around six months around 2007," a spokesman for Portsmouth said. Chelsea said it had no record of Aisultan Nazarbayev's selection taking place. Aisultan Nazarbayev studied at the UK's Royal Military Academy, Sandhurst, in 2009 and is now back in Kazakhstan. He joined the reserve team for Astana FC, the capital's lavishly funded football club in March. "I haven't played for the first team yet, but I assure you it will be soon," he said. DEATH OF RUSSIA. Russia moves toward decentralization and disintegration time: 17 July 2011, 16:59 A KGB news agency New Region was forced to admit that the days of Russia numbered. In the article entitled "Russia is moving toward decentralization and disintegration" the agency writes about its country:"The country is actually on the verge of civil war. This is stated in the joint (KGB - KC) statement of the organization National Alliance and the unification of the Russian national organizations "Right league".As stated in the document, now there is largely a question of the legitimacy of the naming of the current territory of Russian Federation - Russia. ? "It seems to have everything you need: history, territory, population, but there is not one thing - the state. But it is impossible to name a power busy with the purely personal ("election", "national projects", "seligers") problems.The consequence could be decentralization and the country's disintegration, which, of course, entail ruinous, and the final collapse of the Russian state!", the statement's authors point out. ? Department of MonitoringKavkaz CenterShitty little country Austria licks boots of Russians - aggressive and armed enemies of civilization time: 17 July 2011, 22:29 Due to?an unprecedented release by Austrian authorities of a hardened Russian terrorist, a FSB/KGB colonel Mikhail Golovkov, who hasn't yet been eliminated for his horrific crimes against humanity, an Austrian?newspaper Kurier reported on international opinions?on blatant and overt support by the?Austrian?Democratic regime of international terrorism?coming from the Russian terrorist gang of the FSB/KGB:? A report about a short-term detention by Austria and?a rapid release of 62-year-old Russian KGB officer who is accused of war crimes in Lithuania, caused outrage in this Baltic country.?Along with harsh criticism of the Austrian authorities from the part of senior Lithuanian politicians and representatives of the Lithuanian ministry of justice, a political analyst and commentator Vladimiras Laucius described Austria as a "shitty little country" in?his comments published on the website delfi.lt. ? In addition, Laucius accused Austria of "legal nihilism", disrespect for the victims of the Russian massacre of January 13, 1991 and "shameful licking of Russian boots". The Lithuanian commentator also criticized the European Union, which cares about the needs of consumers, producers, tourists and sexual minorities, while forgetting about the geopolitical interests of security and defense, as well as about?"armed and violent enemies of civilization", writes the Vienna newspaper. ? The Austrian newspaper didn't report that the users of the Russian-language section of?the?Lithuanian website delfi.lt testify that the mass murderer?Golovatov?is a jew. On his photos, he has a typical jewish appearance, his name is surely not Russian and derives from a jewish family name Holowat. He held a position?of?the leader of?a KGB killer group, which is out of reach for an ethnic Russian,?Lithuanians of Russian origin write on the website delfi.lt.?Meanwhile, it is?worth mentioning that the Lithuanian commentator Vladimiras Laucius is absolutely right in his opinion about Austria:1. On the orders from Moscow, Austria is brutally persecuting Caucasian refugees in particular and Muslims in general. Austria subject Muslims to tortures and imprisonment for just publishing on the net?the truth about the crimes of Western crusaders against Islam. ? 2. Austria extradites to Belgium?for torture and judicial murder armless Caucasian refugees, accused by Belgian investigation judges of most absurd and deliberately indiscriminate crimes,?for example, in planning to blast a train with NATO soldiers although they are not transported by Belgian railroads since 2005.?3. Austria still has not issued?an international arrest warrant for Putin and Kadyrov for the murder of a Chechen refugee Israilov.?4. Austria implants by the brutal judicial reprisals the holocaust myth.? 5. Austria imprisons honest?British historians who expose that lie, and etc. ? Meanwhile, Lithuanian media report, citing additional information?from newspapers of Russian terrorists, about?the?rogue country Austria:?The ex-ringleader of the Russian?terrorist group?Alpha, former KGB colonel Mikhail Golovatov (as Putin said, there are not former KGB officers, all of them are active and on duty, even after their formal retirement.?Putin knows better - KC), who was detained in Austria at the request of Lithuania, returned to Moscow. This was reported by a Gazprom's radio station, Echo of Moscow. ? Media outlets reported that the Russian terrorist M. Golovatov was released due to?quick interferance by two Russian terrorist groups: "ministry of foreign affairs" and "Russian attorney?general office".?However, according to false claims?by Austrian officials, the suspect was released "only for legal reasons". A representative of the Austrian foreign ministry?lied to AFP that the reasons, mentioned in?the European arrest warrant issued by Lithuania, were "insufficient" to detain Golovatov. ? Meanwhile it is reported that the former KGB colonel Mikhail Golovatov who is suspected of involvement in bloody Russian bloodbath, committed against Lithuanians on January 13, 1991, was not even handcuffed in Austria,?reports the Vienna newspaper Kurier.?The newspaper points out that Russian terrorist Golovatov was notified?that he was?seached for under an arrest warrant as war criminal who commited crimes against humanity in the transit area of the Vienna airport?and decided to fly back to Moscow. ? 14 killed and 1,000 wounded?peaceful?unarmed Lithuanian civilians?-?such is the horrific result of the "Vilnius Bloody Night", committed by KGB/FSB colonel Golovatov on January 13, 1991 in the Lithuanian capital. On that date, opponents of the Russian occupation regime tried unsuccessfully to protect?a?TV tower from the Russian special terrorist killer group "Alpha". The battle ended in victory for the Russians, led by the KGB?colonel Golovatov. ? After the declaration of Independence of Lithuania (it was declared back in March 1990 - KC) Golovatov was accused of war crimes and crimes against humanity. ? The rogue country Austria helps much to Russian terrorist Golovatov in particular and Russian terrorism in general. ? Department of Monitoring Kavkaz CenterNational Economic Trends$36Bln of State Assets a Year to Sell July 2011BloombergThe?Economic Development Ministry expects to?earn 1 trillion rubles ($35.6 billion) a?year under an?expanded asset-sale program, Economic Development Minister Elvira Nabiullina was cited as saying Saturday.The government's previous plan called for?a total of?1 trillion rubles of?asset sales over the?next three years. President Dmitry Medvedev ordered the?government last month to?amend the?list by?Aug. 1, saying the?plan was "too modest.""We're discussing about 1 trillion rubles annually from?state asset sales and?keeping a?'golden share' in?a number of?the companies," RIA-Novosti reported, citing Nabiullina. "For infrastructure companies, we're not proposing going below less than 50 percent plus one share."The economy ministry wants to?sell a?10 percent stake in?Rusnano as part of?the program, the?minister was cited as saying. The?government continues to?discuss changes to?the asset sale plan, Nabiullina was cited as saying.The government may propose a?"transition period" after which it might relinquish the?golden shares, which allow the?state to?block major decisions, Nabiullina was cited as saying. A?list of?companies will be ready nearer to?Medvedev's Aug. 1 deadline, she was cited as saying.The economy ministry expects capital outflow this year rather than inflow of?as much as $10 billion as previously forecast, Nabiullina was also cited as saying."We believed that, in?the second half, there could be a?big inflow of?capital," Nabiullina was cited as saying. "We believe that inflow is possible, in?part as companies increase borrowing, but nonetheless we're going to?reconsider" the?full-year forecast.Privatisation sell-off to expand to RUB1 trillion in assets each year 18, 2011The Economic Development Ministry has raised its forecast of income from the privatisation programme to RUB1 trillion ($35.6bn) each year as it works on expanding the list of assets to be sold, said Economic Development Minister Elvira Nabiullina on Friday. The raised expectation - which suggests the programme is to triple in size - follows demands from President Dmitry Medvedev last month to boost its scope and accelerate it. First announced last year, the privatisation plan was originally targeting RUB1 trillion over the next three years. However, Medvedev complained in June that the plan was "too modest," and ordered ministers to draw up a new list of assets to be sold by August 1. He also insisted that the state should divest controlling stakes in many companies, as well as asking for a schedule. The privatisation programme has been slow to take off in its first year, with only a 10% stake in VTB put on the market so far this year. The plan has been beset from the off by objections from management at the companies nominated, but Medvedev's camp has become increasingly irritated by this in recent weeks, and upped its calls to push through the sales. "We're discussing about RUB1 trillion annually from state asset sales and keeping a 'golden share' in a number of the companies," Nabiullina said, according to RIA Novosti. However, she added that certain companies will not leave state control: "For infrastructure companies, we're not proposing going below less than 50% plus one share." Exactly which companies she was referring to appears unclear. Finance minister Alexei Kudrin has said twice recently that the state will leave the transport sector entirely. At the same time, oil pipeline operator Transneft has managed to keep itself off the privatisation list entirely.Discussion of the changes to the plan are continuing in the government Nabiullina pointed out, adding that a "transition period" may be proposed, after which it could relinquish the golden shares. A list of companies will be ready nearer Medvedev's deadline, she stated. Meanwhile, she said that her ministry would like to sell a 10% stake in Rusnano - the state's nanotechnology development holding - which has yet to reap any significant projects.Economics Ministry proposes selling 10 pct in RusNano 18/07/2011MOSCOW, July 18 (RIA Novosti)Russia's Economic Development Ministry hopes to sell off a 10 percent share package of the RusNano hi-tech government corporation in its new privatization plan, Economic Development Minister Elvira Nabiullina said on Monday."Indeed, we have plans to earn about 1 trillion rubles a year from the sale of state property but retain a golden share in some companies. As for RusNano, our proposal is to sell 10 percent of the company's shares," Nabiullina said.Discussions are currently taking place on the issue before the government takes a final decision, she said.The government may retain a golden share for a transitional period and give it up afterwards, Nabiullina said.The golden share would allow the government to sell the whole share package but keep a nominal share that can outvote all other shares in specific circumstances."We have not yet discussed the length of the transitional period while the list of companies will be submitted closer to August 1," she said.The Economic Development Ministry has proposed that the government should retain at least 50 percent plus one share in infrastructure companies, she said.July 18, 2011 09:22Banks have 661.8 bln rbs on CBR correspondent accounts on July 18.. July 18 (Interfax) - Russian banks have 661.8 billion rubles on correspondent accounts in the Central Bank as of July 18 including 504.2 billion rubles for Moscow banksThe balance on July 15 was 662.9 billion rubles and 491.9 billion rubles, respectively.Banks had 594.7 billion rubles on deposit accounts in the Central Bank on July 18 against 644.1 billion rubles on previous day.Ruble Heads for Week-Low as Europe Debt Woes Curb Risk Appetite Jack Jordan - Jul 18, 2011 9:40 AM GMT+0200 The ruble fell against the dollar, poised for its lowest close in almost a week, as concern the euro area’s debt crisis will slow the global recovery curbed demand for riskier emerging-market assets. The currency was 0.3 percent weaker at 28.185 per dollar as of 10:40 a.m. in Moscow, after declining 0.4 percent last week. A close at that level would be the weakest since July 12. The ruble was 0.3 percent stronger at 39.5725 per euro, leaving it little changed at 33.3094 versus the central bank’s target dollar-euro basket. European leaders hold a special summit this week after eight of the region’s banks failed stress tests. Oil, Russia’s chief export, traded down as much as 56 cents a barrel this morning, while Urals crude, the country’s main export blend, fell 0.1 percent at $117.03 a barrel. “The Russian bourses are likely to retreat at the start of the week in step with activity on core external markets,” analysts at Johannesburg, South Africa-based Tradition Analytics wrote in an e-mailed note. Oil prices have “come under pressure amid a broader rotation towards safe assets as the risk-aversion trend continues.” Emerging-market assets have declined since last week as investors bet the euro area’s crisis may spread to Italy, the region’s third-largest economy. Two-year bonds of Greece and Portugal, both of which have received bailouts, yield 30.3 percent and 17.6 percent respectively, compared with the 5.3 percent yield on similar-maturity Russian debt. Russian government bonds rose for a fourth day, pushing the yield on the ruble Eurobond due in 2018 down one basis point to 6.85 percent. Non-deliverable forwards, which provide a guide to expectations of currency movements and allow companies to hedge against them, show the ruble at 28.4575 per dollar in three months, compared with 28.3363 on July 15. To contact the reporter on this story: Jack Jordan in Moscow at jjordan22@ To contact the editor responsible for this story: Gavin Serkin at gserkin@ Russian figures should point to strengthening investment activity BankJuly 18, 2011Plenty of Russian economic data for June is likely to be published on Monday. We expect the upbeat development from May to continue in both retail sales and investments. As unemployment fell clearly in May, we are hoping to see stronger development in wage growth, although real disposable income has probably continued to decline year-on-year. However, according to preliminary bank lending statistics for June, credit growth has accelerated further, which is likely to have supported consumption despite the sluggish income development. Still, the most interesting figures are related to the construction sector and fixed investments. We expect investments to become the main GDP driver in H2 and, in our view, the first signs of this should already be seen in the June figures.Industrial output up 5.7% y/y in June, 5.3% y/y in 1H11 BankJuly 18, 2011According to Rosstat, in June industrial production posted a 5.7% y/y, or a 0.7% m/m increase, exceeding expectations. Even if construction-related manufacturing growth continued to decelerate, we expect that a likely recovery in investment activity will be supportive for the growth rate and will support our FY11 forecast of 5% y/y. June industrial production showed acceleration compared to the 4.1% y/y seen in May, exceeding both market consensus of 4.8% y/y and our expectations of 5.1%. Given the slowdown in commodity extraction and regulated sectors (see the table below), the key driver of June's good result was manufacturing, which has accelerated since May. The contributors to the quickening manufacturing expansion include the 10% growth in oil throughput - which has been accelerating since bottoming out in February-March during the gasoline crisis - and 6% growth in steel output since a 3% y/y drop in May. We anticipate that manufacturing growth will continue to be supported in coming months if investment growth remains strong. The June statistics raise two concerns. Frst, construction-related manufacturing failed to post strong results: brick production slowed to 16% after showing 30% y/y growth in 1Q11, while cement output was also weak at 10% y/y. Secondly, no acceleration appeared in car manufacturing growth. That said, the 5.3% y/y 1H11 increase supports our full-year expectations for 5.0% y/y industrial growth. Natalia OrlovaBusiness, Energy or Environmental regulations or discussionsNovolipetsk Steel, Polyus Gold, VTB Group: Russia Equity Preview Denis Maternovsky - Jul 18, 2011 6:00 AM GMT+0200 The following companies may be active in Russian trading. Stock symbols are in parentheses and share prices are from the previous close of trading. The 30-stock Micex Index was little changed, declining less than 0.1 percent to 1,714.60. The dollar-denominated RTS Index was little changed at 1,938.54. OAO Novolipetsk Steel (NLMK RX): The Russian steelmaker owned by billionaire Vladimir Lisin reports second-quarter output figures at 10 a.m. in Moscow. The shares fell 1.3 percent to 109.34 rubles. Polyus Gold (PLZL RX): The deadline for minority shareholders of Russia’s biggest gold producer to accept terms of a reverse takeover of KazakhGold Group Ltd. expires July 18. KazakhGold shareholders unanimously approved an increase in the company’s share capital for the purpose of the planned merger with Polyus on July 14. Polyus Gold shares rose 0.4 percent to 1,803.10 rubles, the highest close since June 24. VTB Group (VTBR RX): Russia’s second-biggest lender reports first-quarter results after 10 a.m. in Moscow. The shares added 1.7 percent to 8.46 kopeks, the highest close since July 5. To contact the reporter on this story: Denis Maternovsky in Moscow at dmaternovsky@ To contact the editor responsible for this story: Gavin Serkin at gserkin@ UPDATE 1-Russia NLMK Q2 sales rise to $2.9 bln Jul 18, 2011 7:54am GMT* NLMK Q2 sales $2.9 billion, up from $2.4 bln in Q1* Sees Q3 operating performance up significantly* Q2 crude steel output 3 mln T, up 3.1 pct q/q(Adds details)MOSCOW, July 18 (Reuters) - Russia's Novolipetsk Steel said preliminary estimates showed second-quarter sales reached $2.9 billion, up from $2.4 billion in the first quarter, and it expects operating results to rise in the third."In Q3 we expect the Group's operating performance to improve significantly, due to the consolidation of Steel Invest and Finance rolling assets starting from July 1," the company said on Monday."The share of high value added products is expected to grow materially."In April, NLMK announced it would take full control of its joint venture with Swiss-based Duferco to expand its rolled steel capacity.Steel makers in Russia, the world's fifth-largest producer, are benefiting from their position as low-cost producers after a difficult period when demand collapsed at the end of 2008.NLMK, controlled by Russia's richest man, Vladimir Lisin, also said second-quarter crude steel output reached 3 million tonnes, and that it achieved a 25-30 percent margin on earnings before interest, taxation, depreciation and amortisation (EBITDA).This was in line with the guidance issued last month. (Reporting by Alfred Kueppers; Editing by Will Waterman)Inter RAO Buys Wind Power Station in Lithuania, Kommersant Says Lyubov Pronina - Jul 18, 2011 5:58 AM GMT+0200 OAO Inter RAO UES, the Russian state-controlled power exporter, paid $53.1 million for a wind power station in Lithuania, Kommersant reported, citing unidentified company officials. Inter RAO bought the wind station from Veju Spektras on July 14, the newspaper said. To contact the reporter on this story: Lyubov Pronina in Moscow at lpronina@ To contact the editor responsible for this story: Brad Cook at bcook7@ Russia's auto market set to grow - VW 18, 2011 00:27 Moscow TimeRussia’s auto market is poised to grow by a hefty 60 percent by 2015, VW board chairman said on Sunday.Opening the Petersburg Dialogue forum in Wolfsburg, Germany, Martin Winterkorn said that? Russia was and remains a major market for German goods. The annual trade figure between the two countries now stands at 58 billion Euros and is all set to go up in the coming years, Winterkorn added.Fiat abandons plans to build Nizhny Novgorod plant 18/07/2011MOSCOW, July 18 (RIA Novosti)Italy's auto giant Fiat has given up plans to construct a car plant in the central Russian city of Nizhny Novgorod and is considering the Caucasus or St. Petersburg as alternative production sites, Kommersant business daily reported on Monday.The paper quoted market sources saying Russia's top lender Sberbank, Fiat's potential creditor, has proposed reviving the Derways plant plant in the Karachayevo-Cherkessia republic in the north Caucasus. Fiat wants to build the plant in St. Petersburg, where Ford, Toyota, General Motors, and Nissan have already placed their Russian operations.Fiat abandoned the Nizhny Novgorod plan after failing to agree with Russian auto maker GAZ Group, which has contracts from Volkswagen and GM.Fiat signed a $1 billion agreement in late June with Russia's Economic Development Ministry to produce 120,000 cars a year and construct an engine plant in the country."Fiat is considering various sites, including the north-western region," Dmitry Levchenko, head of special economic zones and project finance department at the Economic Development Ministry, told the paper.Sberbank, GAZ Group and Fiat declined to comment.One market source told Kommersant that Sberbank insisted on Derways because the bank's investment subsidiary Sberbank Capital owns a 51 percent share in the plant, received in exchange for a 1 billion ruble loan. "This is one of Sberbank's major conditions for providing financing," the source said.Fiat Seeks Russia Car Plant in St. Petersburg, Kommersant Says Lyubov Pronina - Jul 18, 2011 6:17 AM GMT+0200 Fiat SpA (F) wants to build a plant in St. Petersburg after failing to reach an agreement with Russian automaker GAZ Group to assemble cars in Nizhny Novgorod, Kommersant reported today citing unidentified officials in the car industry. OAO Sberbank, which may finance the Fiat venture, has suggested the Italian carmaker builds its plant in Russia’s Karachaevo-Cherkessk Region, the Moscow-based newspaper said. To contact the reporter on this story: Lyubov Pronina in Moscow at lpronina@ To contact the editor responsible for this story: Brad Cook at bcook7@ Hyundai Heavy to build plant for power switchgears in Russia 11:17 KSTSEOUL, July 18 (Yonhap) -- Hyundai Heavy Industries Co., South Korea's leading shipbuilder, said Monday that it will start building a plant in Russia later this month that produces power switchgears.The shipbuilder said it plans to spend around 40 billion won (US$37.7 million) on construction of the plant in Russia's Far Eastern city of Vladivostok. The plant will produce so-called gas-insulated switchgears (GISs) starting in August 2012, the company said.VTB first quarter profit soars 71% to 26 bln rbls 18/07/2011MOSCOW, July 18 (RIA Novosti)Russia's VTB group, which includes the country's second largest VTB bank, saw first quarter net profits jump 70.6 percent year-on-year to 26.1 billion rubles ($932 million) to IFRS, the group said on Monday.VTB's return on equity reached 17.7 percent compared to 11.9 percent the previous year, while operating income before provisions rose 25.5 percent to 72.9 billion rubles, VTB said in a statement.The loan portfolio expanded 0.13 percent to 3.063 trillion rubles, while the non-performing loan ratio shrank to 8.2 percent of total gross loans compared to 8.6 percent at the end of 2010.The volume of retail loans amounted to 555.3 billion rubles as of March 31, down from 541.5 billion rublesat the end of 2010, while the volume of corporate loans stood at 2.508 trillion rubles compared to 2.518 trillion rubles at the beginning of the year.UPDATE 1-VTB posts record Q1 net, BoM rescue on track IST(Adds details, background)MOSCOW, July 18 (Reuters) - VTB (VTBR.MM: Quote, Profile, Research), Russia's No.2 bank, on Monday announced record first-quarter earnings and said a record state bailout would stabilise takeover target Bank of Moscow (MMBM.MM: Quote, Profile, Research).State-controlled VTB posted a 70.6 percent gain in first-quarter earnings to 26.1 billion roubles ($928 million) on reduced provision charges, beating expectations of 20.1 billion roubles in a Reuters poll of analysts. [ID:nLDE76D0K1]VTB has come under intense scrutiny after its hostile bid for Bank of Moscow and ousting of management revealed that almost half of the loan book of Russia's fifth-largest bank was doubtful, forcing a $14 billion bailout.VTB said in a regulatory news release that the bailout, which requires it to consolidate 75 percent control, was on track."VTB believes these actions will effectively address all the issues related to the stabilisation of BoM as a sound and competitive financial institution," it said.VTB said its return on equity reached 17.7 percent in the first three months of 2011, up from 11.9 percent in the same period last year. Its net interest margin, a key indicator of underlying profitability, was stable at 4.8 percent.Provision charges fell in Q1 to 7.7 billion roubles, down by over half from the same period a year ago.VTB said that its capital adequacy was 15.5 percent, down from 16.8 percent at the end of 2010. Its Tier 1 ratio was 13.2 percent, up from 12.4 percent.(Reporting by Katya Golubkova, Editing by Douglas Busvine) VTB seals deal on another acquisition July 18, 2011 Undeterred by the cost of cleaning up the Bank of Moscow, VTB signed off on a deal to take control of another bank on Friday, increasing its stake in TransCreditBank. Seller Russian Railways could pocket RUB40bn from the sale, reports Prime. The deal, which has been agreed in principle since October when VTB decided to gradually buy 100% of TCB, and embarked on a series of deals that saw it accumulate a 43.18% stake, was amongst the first of several acquisitions announced by the state's giant banks. Sberbank has since agreed to buy investment bank Troika Dialog and Austria's VBI. The purchase of Russian Railways' 54.39% stake in TCB will go forwards in two stages said Yury Novozhilov, president of the bank. VTB signed an agreement to buy a 29.39% stake on Friday, with the value of the deal estimated at RUB16.5bn. It will then buy the remaining 25% plus one share no earlier than on July 1, 2012, but no later than on December 31, 2013. The price of the second stake will be calculated by a formula agreed upon by VTB Bank and Russian Railways and based on TransCreditBank's financial results. Novozhilov said it could amount to RUB13.5bn, adding that Russian Railways could receive an additional RUB10bn from capitalization of earnings. Aton writes: VTB will pay RUB16.4bn for the 29.4% stake. This implies RUB24.4/share for a multiple of 2.0x YE10 Tier 1 capital. To recap, the supervisory board of VTB previously approved a maximum price of 2.2x TCB’s YE10 Tier 1 capital. The final price is thus within the limit despite the fact that VTB paid RUB21/share (1.7x YE10 Tier 1 Capital on our estimates) for the 43.4% of the shares it bought from minorities.Given VTB’s previously announced intention to bring its stake to 75% minus one share by the end of 2011, buying 29.4% of the shares brings its holding in TCB to 72.8%, implying that 2.2% of the shares currently held by minorities (that is, individuals) will also be acquired by the end of this year.Bottom lineIn light of the huge problems VTB took on with the acquisition of Bank of Moscow, TCB appears to be a bright spot in its M&A activity. While TCB is relatively small compared to VTB (around 9% of its size in terms of assets) we think it is a good purchase for the bank.Sberbank Enters Ex-Satellites as $13 Billion East Europe Bank Deals Loom Boris Groendahl, Marta Waldoch and Denis Maternovsky - Jul 18, 2011 12:01 AM GMT+0200 OAO Sberbank, Russia’s biggest lender, is aspiring to become a regional player in the fast- growing central European market, where lenders worth as much as 9 billion euros ($13 billion) may go on sale in the coming years. Sberbank agreed on July 14 to buy a network of nine small banks in countries including the Czech Republic, Slovakia, Hungary and most of former Yugoslavia from Austria’s Oesterreichische Volksbanken AG. (VBPS) Chief Executive Officer German Gref said this was only the first step in making Sberbank a “global bank” by using the new group as a platform for further acquisitions in eastern Europe and Turkey. Gref is targeting a region dominated by western Europe- based banks. UniCredit SpA (UCG), Erste Group Bank AG (EBS), Raiffeisen Bank International AG (RBI) and Societe Generale (GLE) SA are among the biggest lenders by assets in the former communist bloc after building cross-country networks in the two decades since the fall of the Iron Curtain. Volksbanken was a unique opportunity for Gref to match at least their geographic footprint and establish a base for further expansion. With banks including KBC Groep NV (KBC), Banco Comercial Portugues SA (BCP) and Hypo Alpe-Adria-Bank International AG potentially selling assets from Poland to Serbia, he will have plenty of options to tuck into more deals. Bolster Finances “There is something changing substantially and Sberbank’s acquisition of VBI is part of it,” said Hugo Swann, a banking analyst at Credit Suisse AG. “We are going to see a number of assets changing hands in the next few years, probably sooner. It’s a good opportunity for some banks to take up market share.” The possible sellers in the region include those looking to bolster their finances as they face the challenges of their home countries’ escalating debt. That, along with the need for some to repay bailout funds or meet state aid conditions imposed by European Union regulators, may spur deals. Transactions will mostly be led by either a change in the strategy of the acquiring bank linked to a decision to enter the region or macroeconomic pressures in the parent company’s country, said Artur Tomala, who heads central and eastern European operations at Goldman Sachs International. On top of that, big participants present in many of the region’s countries such as UniCredit or Raiffeisen are already reviewing their operations, and may sell units that lack scale, Credit Suisse’s Swann said. Growth Market “We have seen UniCredit talk about a strategic review of their business, changing their focus slightly to fewer markets with greater market share,” he said in a telephone interview. “We will see other banks taking a view as to where they are going to be, giving up market share in some countries and gaining in others.” As potential buyers, western banks may still be tempted by faster growth in eastern Europe than in their home markets. The euro area is projected to grow 2 percent this year and 1.7 percent in 2012, according to the International Monetary Fund. That’s less than half the rate forecast for central and eastern Europe of 5.3 percent this year and 3.2 percent in 2012. On top of that, products from credit cards to loans and mortgages are still less widely used. Bank assets as a percentage of gross domestic product were at 83 percent in Poland, 115 percent in Hungary and 124 percent in the Czech Republic, compared with 338 percent in the euro area in 2009, according to UniCredit. New Markets For Sberbank, which has been busy managing the rapid growth in its home market followed by the financial crisis in the last decade, the region now offers the potential to boost earnings, said Vladimir Savov, a banking analyst at Otkritie Financial Corp. in Moscow. For Russian banks “there was virtually no need to look to other markets” in the years starting 2000, Savov said. “Then the crisis came, and over the last two-to-three years dealing with the problems of this exponential growth was the main concern.” “Now that the crisis is over, one thing is clear: the local banking market will grow at a more moderate pace, and has already become more competitive,” he added. Banks are now looking for opportunities to “access other markets in order to boost their earnings and return on equity.” Sberbank’s Gref, who has hired former UniCredit CEO Alessandro Profumo to advise on his expansion in the region, told reporters in Moscow that the Volksbanken purchase was his “first step in transforming Sberbank into a global bank.” Apart from eastern Europe, he’s also targeting Turkey, Gref said. Fertile Ground While VBI isn’t among the top five banks in any of its major markets, it gives Sberbank a basis on which to build, Credit Suisse’s Swann said. Sberbank’s actions make “a lot of sense in that they are getting a foothold in a lot of countries and can then bolt on further deals over the next couple of years,” he said. Banking takeovers in central Europe picked up in 2010 after the financial crisis curbed asset sales in the previous two years. Acquisitions exceeded $13 billion in 2010, four times the level of a year earlier, led by Banco Santander SA (SAN)’s 4.2 billion-euro purchase of Bank Zachodni WBK SA (BZW), Allied Irish Banks Plc (ALBK)’s Polish unit, data compiled by Bloomberg shows. Deal values were more than twice the 2010 level in 2006, when $29 billion of emerging European banks were sold. Buyers paid about 3.8 times book value on average that year, compared with 1.6 times last year, according to data compiled by Bloomberg. Greek Sales Greece’s EFG Eurobank Ergasias SA (EUROB) this year agreed to sell a majority stake in its Poland-based Polbank unit to Raiffeisen Bank for 490 million euros to boost capital. The deal will help Vienna-based Raiffeisen, eastern Europe’s third-biggest lender, to almost double its assets in Poland, where it previously wasn’t among the top ten banks. Eurobank also seeks to sell its Turkish unit Eurobank Tekfen, it said last week. “Before the crisis a lot of banks grew their loan books pretty quickly across eastern Europe, now some of those are facing funding and capital shortfalls,” Credit Suisse’s Swann said. “In some ways the Greek banks are examples of this.” Banco Comercial, based in Porto, may also have to sell Bank Millennium SA (MIL) in Poland, analysts including Paul Formanko at JPMorgan Chase & Co. have said. The Portuguese lender must reach a core Tier 1 ratio of 10 percent next year, and said on May 23 it would “analyze” its international operations for reaching that goal. A company spokesman reiterated last week it has no intention of leaving Poland. EU Rules KBC, the recipient of a 7 billion-euro bailout from the Belgian government, plans to sell its Polish bank and insurance units Kredyt Bank SA (KRB) and Warta SA, the Brussels-based company said last week. It is seeking offers of about 2.5 billion euros for the stakes, two people with knowledge of the matter said last month. The sale is part of a restructuring plan agreed with the European Union because of the state aid. For the same reason, Germany’s Bayerische Landesbank and Austria’s Hypo Alpe-Adria-Bank International AG are selling their businesses in eastern Europe. BayernLB’s MKB, Hungary’s fourth-biggest bank, may be worth almost 1 billion euros based on the price-to-book multiples of 1.2 of Hungarian market leader OTP Bank Nyrt. Hypo Alpe, the third-biggest lender in former Yugoslavia, said in February the book value of its business in Croatia, Serbia, Slovenia, Montenegro and Bosnia-Hercegovina was 1.5 billion euros. Apart from Sberbank, European and global banks such as HSBC Bank Plc may be looking at assets in Poland, according to Miklos Kormos, Deutsche Bank AG’s head of investment banking for central and eastern Europe. In Poland, “the economy never slipped into recession,” Kormos said in an interview. “The banks themselves have a relatively stable capital base. It’s appealing both from the growth perspective and asset and capital perspective.” To contact the reporters on this story: Boris Groendahl in Vienna at bgroendahl@; Marta Waldoch in Warsaw at mwaldoch@; Denis Maternovsky in Moscow at dmaternovsky@ To contact the editors responsible for this story: Frank Connelly at fconnelly@; Gavin Serkin at gserkin@; Angela Cullen at acullen8@ Barclays faces large loss in Russian exit? Expobank to be sold in decision to exit retail banking in Russia ? Move part of Diamond's strategy to sell underperforming units? Sale expected to make a tenth of 2008 ?373m purchase price Jill Treanor guardian.co.uk, Monday 18 July 2011 08.43 BSTBarclays is expected to record a multimillion-pound loss as it prepares to draw up a shortlist of potential bidders for the Expobank business it bought in Russia just before the 2008 banking crisis.Bob Diamond, the Barclays boss, was quick to identify Expobank as a business that needed to be disposed of after he took the helm late last year and announced the decision to pull out of retail and commercial banking in Russia in February.A sales process is now under way and sources believe that Barclays will have to sell the operation for as little as a tenth of the ?373m that it paid for the 32-branch operation in March 2008.Among those thought to be potential bidders are the local banks Vostochny Express and the largest Kazakh bank, Kazkommertsbank.High-street banking in Russia – rather than investment banking – has proved difficult for UK banks to crack. HSBC sold its retail business to Citi of the US in June barely two years after trying to break into the market. Foreign entrants face many state-owned competitors – particularly Sberbank and VTB – which exacerbates the problems they face in winning business. Citi is one of the foreign banks to have managed to break into the market.When Barclays, which refused to comment, announced the Expo deal, it had not expected the acquisition to start boosting its overall earnings until 2011. Focused on Moscow, St Petersburg and other parts of western Russia, Expobank was owned by Petropavlovsk Finance until Barclays stepped in.The acquisition was led by Frits Seegers, who was head of global and retail banking for Barclays but has since left the bank. At the time, Seegers had described the bank as "well run" and a local expert, Nikolai Tsekhomsky, former VTB Group finance director, was brought in to speed up growth in the business, which employs about 1,500 people.While Diamond will be keen to demonstrate that he is executing his strategy to pull out of underperforming businesses when he presents the bank's interim results on 2 August, it is unlikely that he will be able to name a buyer for the operation by then. He told the City that he had embarked on a "rigorous and continuous review" of the group's business as he attempts to improve the return to shareholders despite being required to hold more capital to support its existing operations. The bank's return on equity was 7.3% in 2010, while Diamond wants it to hit 13% to 15%.The Barclays investment banking arm, Barclays Capital, will continue to look for business in Russia from big companies and multinationals as well as governments. HSBC is also planning to retain an investment banking presence in the country.CTC Media opens new facility Europe/London, July 18, 2011 By Chris DziadulThe Russian commercial broadcaster CTC Media has launched a new digital state-of-the-art broadcasting complex in the capital, Moscow. Built at a cost of around $17 million (€12 million) over a period of two and a half years, it is the first facility of its kind in the country and will distribute all three CTC Media’s Russian channels (CTC, Domashny and DTV), as well as CTC International. In total, the complex can program and broadcast up to 21 independent channels, which currently includes the three TV networks in multiple time zones and the three separate CTC International channels.CTC Media, which lists MTG as its largest shareholder, aims to digitise and store all of its content at the complex’s digital archive by the end of this year.Activity in the Oil and Gas sector (including regulatory)Russia ratifies common oil market accord , 18.07.2011, Moscow 11:32:54.Russian President Dmitry Medvedev has signed a law to ratify an agreement on the common market for crude and products in Russia, Belarus and Kazakhstan, the Kremlin's press service reported today.??????The agreement, signed in December 2010, envisages that the countries should ensure long-term transportation of crude and products through their existing transportation facilities including the mainline oil and oil product pipeline systems.The agreement stipulates equal access to pipelines for the companies operating in the three countries. Oil Duty Could Fall 1.5% July 2011Russia is likely to?cut crude export taxes 1.5 percent next month and?possibly more if Prime Minister Vladimir Putin adopts a?tax regime designed to?spur investment in?fields.Putin gave the?government two weeks from?July 8 to?submit proposals on?applying the?"60-66" measure after some refiners complained. Rosneft, LUKoil and?TNK-BP, Russia's three largest oil producers, are set to?benefit, VTB Capital analyst Dmitry Lukashov said.The?standard duty will probably drop to?$438.20 a?ton ($59.80 a?barrel) from?$445.10 a?ton in?July, according to?calculations based on?Finance Ministry data.(Bloomberg)18.07.2011IEA: Gas Deliveries from FSU to Europe Reported Up 14.2 Percent in April of gas from former Soviet republics to OECD European countries grew 14.2 precent in April 2011 compared to April 2010, the International Energy Agency (IEA) has reported. According to Gazprom's reports, in the first quarter of 2011, the company exported 41.1 billion cubic meters of gas to OECD countries, or 12 percent more than in the same period in 2010. Meanwhile, Finmarket reported that Gazprom's main market Germany, consumed 16 percent less gas in April than in April of the previous year, but imported 0.8 percent more.Copyright 2011, Oil and Gas Information Agency. All rights reserved.Vankor Tax Exemption Ends Soon July 2011ReutersRosneft will lose its exemption from?the mineral extraction tax on?Russia's largest new oil field Vankor within the?next two months, Rosneft and?Finance Ministry sources said.Vankor, one of?the main sources of?Russian oil output growth, had already been stripped of?a lowered oil export duty in?May. The?additional tax burden will hit hard Rosneft's profitability, which analysts say may fall in?2012 from?this year.According to?Bank of?Moscow analyst Denis Borisov, Rosneft, Russia's top crude producer, will pay an?additional $700 million in?mineral extraction tax for?Vankor this year, and?$2.5 billion in?2012.Alexei Kokin from?UralSib put the?figures at?$800 million and?$2.3 billion, respectively.The?exemption, issued by?Vladimir Putin during his second term as president to?encourage investment in?new fields, is due to?expire when cumulative production hits 25 million tons. "It is likely that total production at?Vankor will hit 25 million tons on?Aug. 6 or 7. As of?Thursday, it was 24.024 million tons," a?Rosneft spokesman said, adding the?company would not contest the?end of?the exemption.A?Finance Ministry source also confirmed that Vankor crude would be subject to?the levy once cumulative production reaches 25 million tons.Rosneft started oil production at?Vankor, which holds more than 500 million tons of?oil extractable reserves, in?August 2009. It aims to?reach daily output of?500,000 barrels per day in?2013.Russia plans to?increase its oil output to?508 million to?509 million tons from?505 million tons in?2010.Ukrainian authorities to help Lukoil re-launch refinery , 18.07.2011, Moscow 11:26:54.Ukrainian authorities are prepared to help Russian oil major Lukoil to re-launch the Odessa Oil Refinery, RBC Daily reported today, citing Ukrainian Energy and Coal Industry Ministry.??????Ukraine's First Deputy Prime Minister Andrey Klyuyev instructed the ministry to hold talks with the management of Lukoil in order to re-launch the refinery shut down for repair in October 2010. ??????A source at Lukoil told the daily that oil refining in Ukraine is unfeasible because Ukraine imports large amounts of oil products from Belarus at dumping prices. Additionally, the Odessa refinery lost its main oil supply route after the Odessa-Brody pipeline was switched over to direct mode to transport Azeri oil to Belarus. Tony Hayward’s investment vehicle Vallares is eyeing up ?8bn Russian payday Daily Mail ReporterLast updated at 10:00 PM on 17th July 2011Former BP chief executive Tony Hayward’s investment vehicle Vallares is expected to make its first acquisitions in Russia, in a brace of deals that could be worth up to ?8bn.Hayward raised ?1.3bn for London-listed Vallares and is understood to be looking to use the proceeds to buy stakes in Russian oil giants Bashneft and RussNeft.Both companies are part-owned by AFK Sistema, a holding company owned by Vladimir Yevtushenkov, one of Russia’s richest men. The deal could pave the way for a multi-million pound pay day for Hayward and business partner Nat Rothschild.Under the terms of the Vallares float the pair, and associates Tom Daniel and Julian Metherell – the former Goldman Sachs banker, would see the ?20m they invested turn into a 6.6pc stake. With Bashneft and RussNeft worth a combined ?8bn, that could value their Vallares stake at ?530m.Ex-BP boss Hayward eyes Russian oil deals – report, Jul 17 2011LONDON (Reuters) - Former BP Chief Executive Tony Hayward is considering a bid for major Russian oil firms Bashneft and Russneft to create an industry powerhouse, Sky News reported at the weekend.Both are part-owned by billionaire Vladimir Yevtushenkov's holding company AFK Sistema, and Hayward could combine both Sistema stakes in an 8 billion pound ($13 billion) deal.He could also focus solely on Bashneft, which has a market value of $11 billion, the report said.Hayward's investment vehicle Vallares raised 1.35 billion pounds from investors last month to target emerging market oil assets.The Sunday Times said on July 10 that Vallares was in early stage talks to acquire Genel Enerji, the biggest oil producer in northern Iraq.Vallares was not immediately available for comment.($1 = 0.620 British Pounds)(Reporting by Paul Sandle)JULY 18, 2011, 3:53 A.M. ETTNK-BP Agrees To Take 45% Stake In Brazil Project - Sources By Jacob Gronholt-Pedersen Of DOW JONES NEWSWIRES MOSCOW (Dow Jones)--BP PLC's (BP) Russian joint venture TNK-BP Ltd. (TNBP.RS) has agreed with Brazil's HRT Participacoes em Petroleo SA (HRTP3.BR) to buy a 45% stake in an exploration project in the Amazon forest, people familiar with the matter said Monday. The deal, which has been approved by TNK-BP's board and will be finalized within three weeks, will see Russia's third largest oil producer take a 45% stake in an oil and gas deposit in Brazil's Solimoes region. Brazil's HRT is the operator and license holder of 55% of the Solimoes blocks. A person familiar with the situation said in May that TNK-BP may pay as much as $1 billion for the stake. The Solimoes blocks cover an area of 48,500 square kilometers. According to U.S.-based petroleum consulting company DeGolyer and MacNaughton, HRT's stake holds 542 million barrels of oil equivalent, of which 84% is natural gas. -By Jacob Gronholt-Pedersen, Dow Jones Newswires; +7 495 232 9197; jacob.pedersen@ 18.07.2011TNK-BP Begins Replacing Pumps at Khokhoryakovskoe Oil&Gas Field will replace pumps at the Khokhoryakovskoe oil and gas field, saving the company 1.4 million kWh a year, TNk-BP West Siberia reported in a news release.Work has already begun to replace three pumps to lower electricity consumption. the news pumps will use lower pressure and have been successfully installed and used in operations at the Verkhnekolik-Yeganskoye, North-Varyenganskoye and Varyengaskoye fields.Copyright 2011, Oil and Gas Information Agency. All rights reserved.Novatek mulls 800 mln eur pact with EnBW-report Jul 18, 2011 9:06am GMTFRANKFURT, July 18 (Reuters) - Novatek , Russia's largest independent natural gas producer, is negotiating a cooperation deal worth 800 million euros ($1.1 billion) with German utility Energie Baden-Wuerttemberg , German paper Stuttgarter Zeitung reported.The two companies are also discussing founding a joint company, or Novatek might take a stake in a unit of EnBW, the newspaper reported, citing unidentified people within EnBW.Larger German competitor RWE said last week it was in exclusive negotiations with Russia's Gazprom over forms of cooperation.EnBW declined comment. (Writing by Peter Dinkloh; Editing by David Holmes)($1=.7070 Euro)Novatek first to navigate the Northern Sea Route in 2011 - press releaseJuly 16, 2011Novatek has announced the inaugural voyage of a high-tonnage Panamax class tanker, which has navigated a new route north of the New Siberian Islands. On 29 June 2011, the tanker "Perseverance" set sail from the Russian port of Murmansk carrying a cargo of 60 thousand tons of NOVATEK's stable gas condensate destined for consumers in China. Icebreaking support for this voyage was provided by Russia's Atomflot, a government-owned shipping entity, and the tanker is now on course to its final destination. NOVATEK is the first company to utilize the Northern Sea Route in the 2011 summer navigational period. Between June and October 2011, the Company plans to ship six or seven cargos of stable gas condensate, produced by the Purovsky Gas Condensate Processing Plant, to markets in the Asian-Pacific region via the Northern Sea Route. Transporting hydrocarbons through the Northern Sea Route is expected to reduce the costs and delivery time for shipments from Russia's northern ports to consumers in the Asian-Pacific region. The use of the Northern Sea Route provides new technical information and navigational experience for hydrocarbon transportation under Arctic conditions and is an integral part of NOVATEK's logistical strategy to develop prospective fields in the Yamal peninsula.GazpromLithuania sees no possibility of agreeing with Gazprom on reducing gas prices, 18 Jul 2011Interfax reported that Ms Dalia Grybauskaite Lithuanian President see no possibility for reaching an agreement with OJSC Gazprom for reducing gas prices for the country.She said "It is difficult to reach an agreement with Gazprom on reducing price since, as I have mentioned, Gazprom's prices are political in character and not economic."She added that "The difference in price between what Gazprom applies for Lithuania and world prices, clearly bears a political nuance. Therefore, everything depends on policy and the position of Russia's leadership on partnership with Lithuania."(Sourced from Interfax)18.07.2011Muravlenkovskneft Installs Innovative Flexible Pipelines, a Gazprom family company, has installed innovative flexible pipelines at its West-Sutorminskoye and Muravlenskoye fields, Gazprom Neft reported in a news release.The use of flexible pipelines was successfully tested at Cluster 22 of the West-Sutorminskoye field. The high output and mobility of the equipment will increase project production rates. The main advantage of the equipment, according to ANGI, is the fact that it enables operators to quickly reroute pipelines without the need to suspend operations for any significant amount of time.Copyright 2011, Oil and Gas Information Agency. All rights reserved.Sechin favors Gazprom/Renova energy assets consolidation DialogJuly 18, 2011Deputy Prime Minister Igor Sechin has given a positive assessment of the consolidation of Gazprom and Renova energy assets (GEH and IES Holding, respectively), Interfax reported on Friday. The government supports Gazprom's operations with these new assets, as the company could attract extensive financial resources for asset modernization, which is important, Sechin stated. However, the government will watch the deal to prevent an electricity price increase. On a separate note, GEH is expected to hold an IPO in 2013-14 after the consolidation with IES Holding's assets, and definitely not in 2012, according to Gazprom management board member Kirill Seleznev, as cited by Interfax. Troika's view: The government's support for the consolidation indicates that the deal is likely to occur and should not encounter any serious obstacles from the Federal Antimonopoly Service (FAS), though the FAS could impose some behavioral conditions and prescriptions. GEH and IES Holding are currently involved in consolidating their own assets, and thus we see no immediate implications from this news. As for GEH's IPO, this should be generally positive for the stocks that are on the perimeter of the deal. However, since Seleznev confirmed that the terms of the deal include the possibility of partial sales of IES Holding's TGK stakes (to Gazprom or in the market during the IPO) in case Renova's stake in the consolidated GEH exceeds 25%+1 share, some overhang risk could arise in TGK-5, TGK-6 and TGK-7. Alexander Kotikov ................
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