Russia 110317

Basic Political Developments First inspection under START possible next month - Foreign Ministry Lavrov, Clinton could meet in May - Russian ministry UNSC rejects Russian ‘cease-fire’ proposal on Libya Radiation situation in Khabarovsk Krai, Jewish Autonomy normal

o Russian Far East buying up iodine, dosimeters and air ticketso No need for urgent evacuation of Russians from Tokyo so far –

ambassadoro Russian embassy in Tokyo doen't see reasons for evacuationo Fifty-six Russians return from Japan – ministryo Aeroflot to make additional flight to evacuate Russians from Tokyoo Russian rescuers pull seven bodies from debris in Japan o Russian Far East sends aid to Japano Russian students launch campaign to support disaster-hit Japan o Russia gives aid to Japan - and gets supplies from Turkey

Turkey sends aid to Russian Far East - Turkey on Thursday sent humanitarian aid to Russia's Far East on Thursday amid fears that the region will be affected by fallout from damaged reactors at Japan's Fukushima Daiichi nuclear power plant.

New system speeds up Chinese border crossing - Now a medical check will take 20 minutes less, which will speed up border crossing between Heihe and the Russian city of Blagoveschensk across the River Amur.

Russian, Kazakh presidents to discuss economic issues No cheap gas for Turkey without pipe approval Russia considers abandoning South Stream gas pipeline project Armenian protesters leave coffin at Russian embassy - The protestors carried

flags of Armenia and the Armenian Revolutionary Federation-Dashnaktsutyun, banners saying Erdogan=Ataturk, Medvedev=Lenin?”, “Fraternize with anyone you want, but not at the expense of Armenians”.

Turkish PM arrives in Kazano Turkey's Erdogan Pays Visit To Tatarstan

PM Erdoğan: Turkish-Russian relations expanding into new areas Hungarian delegation in Moscow for economic talks Polish-Russian relations "good" – Sikorski Russian trade team eyes new Saudi deals - A 72-strong Russian business

delegation is arriving in the Kingdom on Thursday, aiming to broaden trade links here in sectors such as energy, construction, banking, retail, tourism, health care and mass media.

Moving Belene's equipment to Kozloduy NPP will boost price – Rosatomo Rosatom: We are not quitting Belene NPP

Rosatom reneges on Mantra deal, cites Japan's nuclear crisis FT: Russia: nuclear export hopes hit - The disaster at Japan’s Fukushima nuclear

power plant is reverberating around the Moscow headquarters of Rosatom. SCO defense ministers sign cooperation plan for 2012-2013

SCO defense ministers to meet in Astana on Thursday Customs union to spark agricultural opportunities for Kazakhstan, China -

executive (repeat) Kazakhstan to render mil-tech aid to Kyrgyzstan Natalia Yacheistova: Kyrgyzstan is the main contender for recipient status within

Russian international programs o Omurbek Abdyrakhmanov: Kyrgyzstan should nationalize 100 percent of

MegaCom shares o Kyrgyzstan and Russia to create vacancy databaseo Anatoly Kuznetsov: Russia cooperates with Kyrgyzstan addressing

migration issues at the highest level o Almazbek Abytov: Two fifth of Kyrgyzstan’s population is involved into

migration processes o Vitaly Orosaliyev: Russia is concerned with forming anti-drug belt across

Kyrgyzstan Russian human rights activist to be deported from Belarus Parliamentarian sees no future for modernization program without Medvedev Reuters PRESS DIGEST - Russia - Mar 17 RIA Russian Press at a Glance, Thursday, March 17, 2011 U.S., Russia offer sites for figure skating worlds this spring

National Economic Trends Central Bank asks Sberbank to up dividends Russia May Ask Sberbank to Increase Dividends, Kommersant Says Russia's improving macroeconomics pushing fights amongst officials once more Russia - Emerging Markets Briefer The government needs foreign capital - There are not enough internal funds for

the country’s modernization

Business, Energy or Environmental regulations or discussions Russia Stocks Advance as Oil Gains on Growing Middle East Unrest Moody's says mergers and acquisitions will strengthen Russian banking sector UPDATE 1-Sekerbank shares jump on report of Sberbank interest Russia's VEB to start syndication next week – sources Rusagro voices London IPO plans VimpelCom Faces Tough Vote on Tie-Up Vimpelcom eyes victory in disputed $6 billion Wind deal Russian and Finnish Mobile Operators Discuss Roaming Europe’s Stock Pickers of Decade Split on Cost of ‘Russia Risk’

Activity in the Oil and Gas sector (including regulatory) RPT-UPDATE 1-Rosneft eyes Arctic deals with China, India firms Lukoil Likely to Join Bashneft in Nenets Tatneft maintains Jan-Feb oil-extraction level at 4.2 mln tones

Gazprom Gazprom continues talks with CNPC over natural gas deliveries (repeat) Gazprom may speed up Sakhalin-3 project

------------------------------------------------------------------------------------------

Full Text Articles

Basic Political Developments

March 17, 2011 12:30

First inspection under START possible next month - Foreign Ministryhttp://www.interfax.com/newsinf.asp?id=229355

MOSCOW. March 17 (Interfax) - The first inspection under the New START may take place in April, Russian Deputy Foreign Minister Sergei Ryabkov told reporters on Thursday.

"The first inspection may take place two months after the signing of the START, as it is said in the treaty protocol," he said in comment on a statement by U.S. Secretary of State Hillary Clinton.

"The inspection is possible in no less than two months after February 5," he said.

"It is not necessarily to start the inspection on the 60th day of the treaty validity. The sides will reach an agreement, and there will be no parity in the inspections. Everything depends on the priorities, interests and abilities of the sides to send their inspectors on a particular date," he said.

"These are purely technical issues, which will be resolved at the bilateral consultative commission. It will coordinate plans, which will satisfy everyone, in the performance of inspections and other activities envisaged by the protocol. The commission will get down to business soon," Ryabkov said.

12:27Lavrov, Clinton could meet in May - Russian ministry

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

UNSC rejects Russian ‘cease-fire’ proposal on Libya http://www.thehindubusinessline.com/industry-and-economy/economy/article1546116.ece

PTIUnited Nations, March 17: 

The UN Security Council has rejected a Russian proposal to pass a smaller resolution calling for a cease-fire in Libya, even as the 15-member body debated a draft resolution to impose a no-fly zone over the North African nation.

“We did come up with the idea of doing a brief but punchy ceasefire resolution,” the Russian envoy to the UN, Mr Vitaly Churkin, told journalists after consultations ended late Wednesday.

“I even offered to include some specific strong language directing the call for a ceasefire particularly to the Libyan authorities,” he said, noting that the proposal was not meant to replace the no-fly zone resolution.

France, however, said the Russian proposal was weaker than the resolution passed by the Security Council, last month, which had not deterred Mr Muammar Gaddafi’s forces from a violent crackdown on the rebels and civilian population.

Resolution 1970, adopted on February 26, slapped sanctions on the Libyan regime including an arms embargo, an asset freeze and travel ban on Mr Gaddafi and his loyalists, and a referral to the Hague-based International Criminal Court.

“This (Russian) proposal is certainly not enough,” said Mr Stephane Crouzat, French mission spokesperson. “It has no teeth and we don’t want to engage in a resolution that will be less than 1970.”

“Our expectation is to vote tomorrow on a forceful resolution and not on a wait and see resolution,” he added.

Ms Susan Rice, US envoy to the UN, noted the cease-fire element of the Russian proposal could be incorporated into the lengthier draft resolution.

“I think most members of the Council were focused on the importance of the Council taking swift and meaningful action to try to halt the killing on the ground,” she told journalists.

Radiation situation in Khabarovsk Krai, Jewish Autonomy normal

http://www.itar-tass.com/eng/level2.html?NewsID=16054500

17.03.2011, 09.04

KHABAROVSK, March 17 (Itar-Tass) - Natural radiation background is normal throughout the Khabarovsk Territory. This is confirmed by the data from monitoring the situation over the past day. The measurements are taken every hour.

The Russian Emergency Situations Ministry’s main department for the Khabarovsk Territory reported on Thursday that in the morning the radiation background in various areas was from zero to 13 micro-roentgen per hour.

The Emergency Situations Ministry’s main department for the Jewish Autonomous Region (JAR) also informs that the situation in the region is normal. Seven weather stations, as well as control posts of the Emergencies Ministry, the Hygiene and Epidemiology Centre, and other agencies are engaged in the radiation levels monitoring in the JAR. According to instrument data, the radiation levels are 10-16 micro-roentgen per hour on Thursday.

There is no threat to human health, according to Emergencies Ministry’ s experts.

Russian Far East buying up iodine, dosimeters and air tickets

http://www.russia-ic.com/news/show/11773/

17.03.2011

Today tenants of Russian Far East are buying up three things: iodine -containing drugs, dosimeters and plane tickets to Moscow. Situation looks like this in Vladivostok, Khabarovsk on Kamchatka and Sakhalin.             Radiation detection instruments and iodine -containing drugs have already disappeared from the shops of Petropavlovsk-Kamchatsky: the local publis did not care even about the high prices for dosimeters - from 5 to 7 thousands rubles (EU 125 - 175).            People on Sakhalin Island have bought up all the tickets to the continent. There are no more air tickets to Moscow, including business class till the end of this week. There are only two economy-class (!) tickets for 90 thousands rubles (EU 2 255). They are to be bought in the nearest time.            Meanwhile tickets to Moscow from Vladivostok are available and they are being sold on minimal price. Ionizing radiation background in all the Far East regions is still within

the normal limits. At the moment there are no circumstances for transferring of radioactive substances to Kuril Islands, Sakhalin and Kamchatka and Russian Pacific coast.             Dosimeter readings for the Far East are available on line in order to prevent panic.

March 17, 2011 12:13

No need for urgent evacuation of Russians from Tokyo so far – ambassadorhttp://www.interfax.com/newsinf.asp?id=229345usiness,

MOSCOW. March 17 (Interfax) - The Russian embassy in Japan has an action plan in the case of emergency situations but is not implementing it so far, Ambassador Mikhail Bely told the Ekho Moskvy radio on Thursday.

"If a crisis begins - and the situation is already rather complicated, contradictory and hard to predict - we will naturally use this plan," he said.

He described the departure of families of Russian mission employees from Japan as "a forced leave."

"The radiation level in Tokyo does not create a problem as yet. If the situation worsens, the Emergency Situations Ministry will provide the evacuation," the ambassador said.

From 6,000 to 7,000 Russian citizens are staying in Japan, he said.

"All the Russian citizens who think they must go can do that. We are ready to give them full assistance," the ambassador said.

The evacuation is possible on several routes, he added.

The ambassador said his wife preferred to stay in Tokyo together with him.

"Like a Decembrist woman, she wants to stay together with me. I think that is right," he said.

Russian embassy in Tokyo doen't see reasons for evacuation

http://www.itar-tass.com/eng/level2.html?NewsID=16054223&PageNum=0

17.03.2011, 06.48

TOKYO, March 17 (Itar-Tass) - The Russian embassy in Tokyo doesn't see the need for urgent evacuation of its staff and Russian nationals from the Japanese capital. Minister Counsellor Sergei Butin told Itar-Tass on Thursday that the radiation level in Tokyo was normal and that the embassy was constantly watching the situation.

March 17, 2011 09:36

Fifty-six Russians return from Japan – ministryhttp://www.interfax.com/newsinf.asp?id=229284

MOSCOW. March 17 (Interfax) - An Ilyushin Il-76 airplane belonging to the Russian Emergency Situations Ministry has airlifted 56 Russian citizens from Japan to Khabarovsk.

"Fifty-six citizens of the Russian Federation, who were staying in Japan for various reasons, but decided to leave the country, have returned to Russia on board an Il-76 plane owned by the Emergency Situations Ministry, which landed in Khabarovsk today," a ministry spokesman said.

An 8.5-magnitude earthquake, followed by a devastating tsunami, struck off the northeastern coast of Japan's Honshu Island at 8:46 a.m. Moscow time on March 11.

Aeroflot to make additional flight to evacuate Russians from Tokyo

http://www.itar-tass.com/eng/level2.html?NewsID=16054352&PageNum=0

17.03.2011, 01.00

MOSCOW, March 17 (Itar-Tass) - Aeroflot, Russia’s major aircraft carrier, will make an additional flight from Moscow to Tokyo and back to Moscow on Thursday. The Boeing-767 will evacuate Russian nationals from Japan, which continues to be hit by powerful earthquakes and nuclear power plant accidents, a company source told Itar-Tass.

The Boeing-767 has 30 seats in business class and 184 in the economy class. Only business class tickets will be available in free sale. Tickets to the economy class will be sold at a special tariff to the family members of employees of Russian organizations operating in Japan.

“In view of the situation unfolding in Japan, it was decided that the families of employees of Russian institutions operating in Japan, including the embassy in Tokyo, general consulates and a trade mission, should temporarily leave Japan presumably on March 18,” the Russian Foreign Ministry said.

The staff of Russian diplomatic missions and other Russian state organizations will stay in Japan.

Russian rescuers pull seven bodies from debris in Japanhttp://en.rian.ru/world/20110317/163050682.html

08:58 17/03/2011

Russians rescuers have dug out seven bodies from the debris in the disaster-struck Japanese city of Sendai, a Russian Emergencies Ministry spokesman said on Thursday.

Russia has sent a total of 165 rescuers to Japan. They have all been stationed in Sendai together with rescue teams from other countries.

The Russian rescuers have searched a territory of about 10 square kilometers, the spokesman said, adding that rescue work would continue.

The Japanese authorities confirmed on Wednesday that more than 13,000 people were killed or are missing as a result of a 9.0-magnitude earthquake and tsunami that hit northeastern Japan on Friday. The number of confirmed dead stands at more than 5,100.

The disaster knocked out cooling systems at the Fukushima Nuclear Power Complex, raising fears of a nuclear meltdown as blasts were reported at several reactors.

KHABAROVSK, March 17 (RIA Novosti)

Russian Far East sends aid to Japanhttp://english.ruvr.ru/2011/03/17/47539911.html

Mar 17, 2011 10:22 Moscow Time

The Russian President’s envoy to the Far East, Viktor Ishayev, has called on regional governments to provide humanitarian aid to Japanese people affected by the devastating earthquake and tsunami.

Governors are advised to launch a campaign among businesses and the public.

Bank accounts were opened in the Khabarovsk and Primorye Regions for people to make donations.

The Red Cross regional offices are collecting clothes for hundreds of thousands of homeless people in Japan.

The Emergency Situations Ministry is sending an 18-tonne planeload of blankets and fresh water from Blagoveshchensk to Tokyo.

Russian students launch campaign to support disaster-hit Japanhttp://en.rian.ru/russia/20110317/163049939.html

07:49 17/03/2011

Students in Russia's Far East launched a campaign on Thursday to help those affected by Japan's disaster, Alexandra Tatomir, a campaign organizer, said.

Students of the Far Eastern Federal University and other universities in Vladivostok have launched a Russian-language website entitled "Vladivostok Prays for Japan" (vladpraysforjapan.dtree.ru).

"Vladivostok is the closest Russian city to Japan, and we cannot stay indifferent to our neighbors' tragedy," a statement posted on the website said.

Tatomir, who represents Model United Nations in Vladivostok, said she had a friend in Japan, which was an important reason for her to initiate the campaign.

"It is very difficult to see how people close to you are suffering," she said.

The students also installed memory boards at their universities, on which everyone can express their condolences to the Japanese people, and charity collection boxes in supermarkets across Vladivostok. All the money collected will be handed over to the Japanese consulate, Tatomir said.

Japanese authorities confirmed on Wednesday that more than 13,000 people were killed or are missing as a result of last Friday's devastating earthquake and tsunami in northeastern Japan. Police figures put the number of confirmed dead at more than 4,300.

The disaster knocked out cooling systems at the Fukushima Nuclear Power Complex, raising fears of a nuclear meltdown as blasts were reported at several reactors. Japanese nuclear experts have been trying to cool the troubled reactors using seawater to prevent the release of radioactive steam.

VLADIVOSTOK, March 17 (RIA Novosti)

Russia gives aid to Japan - and gets supplies from Turkeyhttp://themoscownews.com/russia/20110317/188499074.html?referfrommn

by Andy Potts at 17/03/2011 11:18

 

Russia is both giving and receiving aid as the world watches Japan’s nuclear clean-up operation anxiously.

Emergency services ministry planes began delivering humanitarian supplies to Japan on Wednesday, while Russian rescue teams have been on the scene in Sendai, about 120 km from the damaged nuclear plant, since Monday.

And in Vladivostok, students have launched a campaign to help the Japanese relief effort.

Meanwhile Turkey has delivered a planeload of supplies to the Pacific port amid fears that Russia’s Far East will be affected by fallout from the Fukushima Daiichi plant.

 

Praying for Japan

Students at the Far Eastern Federal University and other institutions in the city have set up a Russian language website called Vladivostok Prays for Japan.

Alexandra Tatomir, one of the organisers, explained that with the city being just 800 km from Fukushima, she and her colleagues felt a neighbourly bond with the Japanese.

“It is very difficult to see how people close to you are suffering,” she told RIA Novosti, adding that she had a friend in Japan who had inspired her to set up the campaign.

As well as the website, students have installed memory boards at universities where people can leave messages of condolence.

More practically they are organising collections in supermarkets across the city, with the money raised going to the Japanese consulate in the city.

 

Turkish support

But while many in the Far East are looking to give aid, Turkey, whose prime minister Tayyip Erdogan met Dmitry Medvedev in Moscow on Wednesday, is sending supplies to the Russian region.

A plane brought 17 tons of equipment, including blankets and personal hygiene items, Vladivostok’s Red Cross team told RIA Novosti.

Russian officials have continued to rule out any threat of increased radiation levels in the region, and are advising against taking anti-radiation medicines unnecessarily.

But many are dubious of official figures and have rushed out to buy their own dosimeters.

 

Cooling efforts

At Fukushima, army helicopters have been drafted in to douse the overheating reactors with sea water.

The cooling is intended to reduce the risk of a catastrophic meltdown in reactors 3 and 4, both of which have been damaged by fires and explosions after the plant shut down automatically in the wake of Friday’s earthquake and tsunami.

Despite these efforts, radiation levels around the plant remained high early on Thursday morning, the operators told Kyodo news.

 

Russians return home

Russia’s emergency services flew 56 citizens from Tokyo to Khabarovsk. All of them had been living or working in the provinces hit by the quake and subsequent tsunami.

The evacuation was voluntary, officials said.

Russia’s embassy in Tokyo will not evacuate, despite the crisis.

Meanwhile chief sanitary officier Gennady Onishchenko has called for all flights from Japan to be screened for radiation on arrival.

Turkey sends aid to Russian Far Easthttp://en.rian.ru/russia/20110317/163051796.html

Turkey on Thursday sent humanitarian aid to Russia's Far East on Thursday amid fears that the region will be affected by fallout from damaged reactors at Japan's Fukushima Daiichi nuclear power plant.

"The plane arrived in Vladivostok at 06:00 a.m. local time [Wednesday 20:00 GMT]," local Red Cross head Nadezhda Ilyina said. "It brought 17 tons of aid, including bed blankets and personal hygiene items."

Japanese troops are trying to avert a nuclear disaster by spraying water at four of Fukushima's six reactors that were damaged by blasts and fires in the days following Friday's 9.0-magnitude earthquake and tsunami.

Russian officials have so far dismissed fears that the radiation will spread to Russia's Pacific coast and advised people against taking anti-radiation medication.

Turkish Prime Minister Tayyip Erdogan was in Moscow on Wednesday for talks with Russian President Dmitry Medvedev.

 

VLADIVOSTOK, March 17 (RIA Novosti)

New system speeds up Chinese border crossinghttp://english.ruvr.ru/2011/03/17/47539568.html

Mar 17, 2011 10:30 Moscow Time

An infectious diseases electronic control system has been installed at the Heihe border checkpoint in northeastern China.

Now a medical check will take 20 minutes less, which will speed up border crossing between Heihe and the Russian city of Blagoveschensk across the River Amur.

Last year, the checkpoint saw more than a million people coming in and out of China.

Russian, Kazakh presidents to discuss economic issues

http://www.itar-tass.com/eng/level2.html?NewsID=16053972&PageNum=0

17.03.2011, 02.58

MOSCOW, March 17 (Itar-Tass) - The presidents of Russia and Kazakhstan, Dmitry Medvedev and Nursultan Nazarbayev, will meet on Thursday to discuss economic cooperation between the two countries, including fuel and energy sector, and urgent regional problems.

Nursultan Nazarbayev arrived in Moscow for a visit in the run-up to the snap presidential election scheduled for April 3. Three other candidates will run for president alongside with Nazarbayev who’s been in office since 1990.

The Russian and Kazakh presidents will meet in the Gorki residence near Moscow.

“During the meeting the presidents will exchange views on urgent issues of trade and economic cooperation, including fuel and energy sector, interaction in space research and prospects for expanding inter-regional and border ties,” the Kremlin press service told Itar-Tass.

“During the talks the presidents are expected to discuss questions related to the formation of the Customs Union of Russia, Kazakhstan and Belarus. They will outline further steps to create the Common Economic Space of the three countries, which is to be launched on January 1, 2012. The two leaders will focus on development of other integration associations operating in the post-Soviet territory such as the CIS, the EurAsEC and the CSTO and on coordination of actions at the United Nations and the SCO,” the Kremlin press service went on to say.

“The presidents are expected to exchange views on urgent international issues, including the situation in Northern Africa, Japan and the Central Asian region,” the Kremlin source went on to say.

The Kremlin believes that a regular summit will contribute to further deepening of trust-based strategic partnership, friendship and good-neighbourly relations between Russia and Kazakhstan. The summit will continue an intensive political dialogue between the two countries that reflects high level of bilateral interaction. Medvedev and Nazarbayev met 11 times in 2010.

Russia is a key partner for Kazakhstan. According to the Federal Customs Service, trade turnover between the two countries increased almost by 54% to exceed 15 billion dollars by 2010 compared to 2009. Russian exports have increased by almost 50% to reach 11 billion dollars while imports from Kazakhstan have gone up by 63% to reach 4.5 billion dollars. Inter-regional and border trade accounts for around 70% of the trade volume.

The Russian-Kazakh Inter-governmental commission for cooperation was founded in 1997. It’s going to hold a regular 14th meeting in Moscow on November 26, 2010.

Russia and Kazakhstan cooperate in culture, science, education and sport.

A program of cooperation in humanitarian sphere for 2007-2010 has been implemented.

Russian, Kazakh presidents to discuss economic issues

http://www.itar-tass.com/eng/level2.html?NewsID=16054354&PageNum=0

17.03.2011, 02.58

MOSCOW, March 17 (Itar-Tass) - The presidents of Russia and Kazakhstan, Dmitry Medvedev and Nursultan Nazarbayev, will meet on Thursday to discuss economic cooperation between the two countries, including fuel and energy sector, and urgent regional problems.

Nursultan Nazarbayev arrived in Moscow for a visit in the run-up to the snap presidential election scheduled for April 3. Three other candidates will run for president alongside with Nazarbayev who’s been in office since 1990.

The Russian and Kazakh presidents will meet in the Gorki residence near Moscow.

“During the meeting the presidents will exchange views on urgent issues of trade and economic cooperation, including fuel and energy sector, interaction in space research and prospects for expanding inter-regional and border ties,” the Kremlin press service told Itar-Tass.

“During the talks the presidents are expected to discuss questions related to the formation of the Customs Union of Russia, Kazakhstan and Belarus. They will outline further steps to create the Common Economic Space of the three countries, which is to be launched on January 1, 2012. The two leaders will focus on development of other integration associations operating in the post-Soviet territory such as the CIS, the EurAsEC and the CSTO and on coordination of actions at the United Nations and the SCO,” the Kremlin press service went on to say.

“The presidents are expected to exchange views on urgent international issues, including the situation in Northern Africa, Japan and the Central Asian region,” the Kremlin source went on to say.

The Kremlin believes that a regular summit will contribute to further deepening of trust-based strategic partnership, friendship and good-neighbourly relations between Russia and Kazakhstan. The summit will continue an intensive political dialogue between the two countries that reflects high level of bilateral interaction. Medvedev and Nazarbayev met 11 times in 2010.

Russia is a key partner for Kazakhstan. According to the Federal Customs Service, trade turnover between the two countries increased almost by 54% to exceed 15 billion dollars

by 2010 compared to 2009. Russian exports have increased by almost 50% to reach 11 billion dollars while imports from Kazakhstan have gone up by 63% to reach 4.5 billion dollars. Inter-regional and border trade accounts for around 70% of the trade volume.

The Russian-Kazakh Inter-governmental commission for cooperation was founded in 1997. It’s going to hold a regular 14th meeting in Moscow on November 26, 2010.

Russia and Kazakhstan cooperate in culture, science, education and sport.

A program of cooperation in humanitarian sphere for 2007-2010 has been implemented.

No cheap gas for Turkey without pipe approval

http://www.rbcnews.com/free/20110317120007.shtml

      RBC, 17.03.2011, Moscow 12:00:07.Russia will not reduce the price of natural gas for Turkey, unless Turkey approves the construction of Russia-led South Stream gas pipeline under the Black Sea, RBC Daily reported today.

      "Russia is prepared to revise the price of gas supplied to Turkey, but concessions should be reciprocal," President Dmitry Medvedev said Wednesday after talks with Turkey's Prime Minister Recep Tayyip Erdogan. Deputy Prime Minister Igor Sechin pointed out that negotiations on the construction of the South Stream pipeline with Turkey have not yielded any results so far.

Russia considers abandoning South Stream gas pipeline projecthttp://en.rian.ru/russia/20110317/163048925.html05:43 17/03/2011

Russia is studying possibilities to lower the cost of its South Stream gas pipeline project or replace it with a project stipulating liquefied natural gas supplies to Europe, the Kommersant business daily said on Thursday, quoting Russian Deputy Prime Minister Igor Sechin.

The South Stream is designed to transport Russian gas to Europe under the Black Sea bypassing Ukraine. The capacity of the 900 kilometer pipeline, which was planned to become operational in 2015, is intended to eventually reach 63 billion cubic meters per year.

"[Russian energy giant] Gazprom and the government are currently studying various options that would allow minimizing expenses while implementing the South Stream project," Sechin told the newspaper after Wednesday's talks between Russian President Dmitry Medvedev and Turkish Prime Minister Recep Tayyip Erdogan in Moscow.

"An option that stipulates the construction of an LNG plant at the Black Sea may become an addition or an alternative to the pipeline option," he said, adding that the LNG plant may also be constructed in Northern Russia, close to Yamal Peninsula's gas deposits.

Russia signed intergovernmental agreements with Bulgaria, Serbia, Hungary, Greece, Slovenia, Croatia and Austria to build the pipeline's overland section, but Turkey's approval is still needed to construct its undersea section.

The Turkish authorities were expected to approve the construction by October 31, 2010. Sechin told journalists on Wednesday that Russia did not understand why Turkey was reluctant to give the green light for the project, adding that negotiations with Turkish partners would continue.

MOSCOW, March 17 (RIA Novosti)

Armenian protesters leave coffin at Russian embassyhttp://news.az/articles/armenia/33095

Thu 17 March 2011 08:28 GMT | 9:28 Local Time

Young Armenians and MPs from the Armenian Revolutionary Federation-Dashnaktsutyun have demonstrated outside the Russian embassy in Yerevan.

They were protesting at the timing of an official visit to Russia by Turkish Prime Minister Recep Tayyip Erdogan, which coincides with the 90th anniversary of the Treaty of Moscow.

The treaty, signed by the Grand National Assembly of Turkey, led by Ataturk, and the government of Bolshevik Russia, led by Lenin, created Turkey's current borders with Georgia, Armenia and Azerbaijan. Kars and the surrounding area became part of Turkey, prompting Armenian protest.

The demonstrators put a statement into a coffin and left it outside the Russian embassy on Wednesday. The coffin was later removed by police, News.am reported.

The protestors carried flags of Armenia and the Armenian Revolutionary Federation-Dashnaktsutyun, banners saying Erdogan=Ataturk, Medvedev=Lenin?”, “Fraternize with anyone you want, but not at the expense of Armenians”.

Russian politicians and commentators do not link the date of Erdogan’s visit with the treaty anniversary.

Russian State Duma member from the ruling United Russia Party, Sergey Markov, told News.am that the big nations were not concerned at the many problems of smaller

nations. The deputy director of the Strategic Culture Foundation, Andrey Areshev, said that the Turkish PM's visit to Moscow should not be governed by historical associations.

News.Az

Turkish PM arrives in Kazanhttp://english.ruvr.ru/2011/03/17/47529747.html

Mar 17, 2011 00:26 Moscow Time

Turkish Prime Minister Recep Tayyip Erdogan has arrived in Kazan as part of his three-day working visit to Russia. He was met at the airport by the leader of Tatarstan Rustan Minnikhanov.

On Thursday Mr. Erdogan will address students and faculty at the local university, see local sites and meet with the republic’s ex-president Mintimer Shaimiyev before flying to Ankara later in the day.

Turkey's Erdogan Pays Visit To Tatarstan http://www.rferl.org/content/erdogan_turkey_tatarstan/2340790.html

March 17, 2011 Turkish Prime Minister Recep Tayyip Erdogan has paid a visit to Russia's autonomous republic of Tatarstan. 

Turkish reports say Erdogan held talks with Tatar President Rustam Minnikhanov, who later hosted a banquet for the Turkish prime minister. There were few other details. 

Turkey and Tatarstan have strong cultural and historical ties, and bilateral trade has been rising, amounting to some $1.37 billion, according to ITAR-TASS. A lot of that trade is in the car industry. 

Erdogan arrived in Kazan, the Tatar capital, from Moscow, where he held talks mainly on energy issues with President Dmitry Medvedev and Prime Minister Vladimir Putin. 

Both sides reaffirmed their commitment to have Russia's Rosatom build Turkey's first nuclear power plant despite fresh concerns over nuclear energy due to Japan's nuclear crisis. 

Erdogan told Putin he hoped construction on the plant at the coastal city of Mersin -- some 25 kilometers from an active fault line -- could begin in late April or early May. 

The two sides also discussed Russian gas deliveries to Turkey, which imports 64 percent of its gas from Russia. 

Erdogan said Turkey wants to pay less for the gas because of sagging demand due to the recent global recession. 

Medvedev said Gazprom would rather stick to the terms of its contracts, but he told his Turkish partners "in certain cases, we are willing to consider other approaches." 

Separately, Russian Deputy Prime Minister Igor Sechin said that no agreement has been reached with Turkey on the proposed South Stream gas pipeline that would cross its Black Sea territorial waters.    Turkey is a major player in the rival $10.8 billion Nabucco project, backed by the European Union, to pipe gas from Caspian energy producers such as Azerbaijan to Europe.

compiled from agency reports

PM Erdoğan: Turkish-Russian relations expanding into new areas http://www.todayszaman.com/news-238413-pm-erdogan--turkish-russian-relations-expanding-into-new-areas.html

17 March 2011, Thursday / FARUK AKKAN, MOSCOWPrime Minister Recep Tayyip Erdoğan has said that relations between Turkey and Russia are swiftly improving, based as they are on deep roots that extend back decades.  

“Turkish-Russian relations dating back to long ago are taking confident steps toward the future, diversifying into the fields of economy, politics, military and culture,” he told the Turkish-Russian Business Forum jointly organized by the Turkish Confederation of Businessmen and Industrialists (TUSKON), the Turkish Exporters' Assembly (TİM) and the Turkish Union of Chambers and Commodity Exchanges (TOBB) in Moscow on Tuesday.

Erdoğan travelled to the Russian capital earlier on Tuesday and was received by Russian President Dmitri Medvedev before attending the forum, where he addressed almost a thousand Turkish and Russian businesspeople who had gathered to discuss trade and investment opportunities.

A number of Turkish ministers, including Deputy Prime Minister Hayati Yazıcı, Energy and Natural Resources Minister Taner Yıldız, Industry and Trade Minister Nihat Ergün, Foreign Trade Minister Zafer Çağlayan, Agriculture, Rural Affairs Minister Mehdi Eker and Culture and Tourism Minister Ertuğrul Günay, met with their Russian counterparts at a high-level cooperation council meeting later on Wednesday.

“According to the information I received, my colleagues are full of excitement here. This is another source of happiness for us,” Erdoğan said, expressing his hopes for this meeting and meetings between the businesspeople speaking at Tuesday’s forum. Erdoğan met Medvedev on Wednesday, too.

The volume of bilateral trade between the two nations, both of which border the Black Sea without having a common land border, was recorded at $26.5 billion last year. The sum of their trade volumes, however, is over $1 trillion, a sign of how little trade the two are doing with each other despite their geographical proximity and the size of their economies. For Turkey, Russia is a key natural gas supplier, while Turkish businesspeople are particularly active in construction in the Russian market. Also speaking at the forum, Çağlayan said last year’s trade volume was “too little” for two economically powerful states such as Turkey and Russia.

$100 billion Turkey- Russia trade in 2015

Drawing attention to Turkey’s planned $100 billion in energy investments in the next two decades, Erdoğan called on Russian companies to take advantage of that development in Turkey. “This is equal to $5 billion in investment each year [for the next 20 years]. I believe this will provide Russian companies with significant opportunities,” he said.

Turkey has already agreed with Russia on the construction of a nuclear power plant in the southern province of Mersin’s Akkuyu district. Despite the recent catastrophe and unfolding nuclear disaster in northeastern Japan, Erdoğan said Turkey would go on with its plans to acquire nuclear plants, including the one Russia will build in Akkuyu. “We want to start this as soon as possible. Everything is ready,” he noted. The investment required for the project is expected to be around $20 billion. Also speaking at the forum, Russian Deputy Prime Minister Igor Sechin said the Akkuyu nuclear power plant will be the “best of its kind in the world.”

During his speech at Tuesday’s forum, Erdoğan drew attention to Turkey’s aspirations to increase trade volume with Russia to $100 billion by the end of 2015. That the two nations agreed to remove visa requirements for each other’s citizens during a visit Medvedev paid in Turkey is expected to facilitate reaching this target. Starting on April 17, Turkish and Russian citizens will have the right to travel visa-free to each other’s countries for 30 days.

On the topic of construction projects in Russia, Erdoğan said Turkish contractors had already completed $32 billion in almost 1,200 projects around Russia. At this point, Erdoğan vouched for Turkish contractors who eye securing business deals as Russia prepares to launch immense investments for the 2013 Summer Universiade games in Kazan, the capital of the Republic of Tatarstan in Russia, and the 2014 Winter Olympics in the southwestern Russian port city of Sochi. Sechin also said Russia hopes more Turkish contractors will conduct business operations across Russia.

Hungarian delegation in Moscow for economic talkshttp://bbjonline.hu/economy/hungarian-delegation-in-moscow-for-economic-talks_56624

MTI – Econews

Thursday 10:00, March 17th, 2011

National Development Minister Tamás Fellegi and a 40-member Hungarian delegation will begin a two-day series of economic talks with Russian officials as part of the sixth session of the Hungarian-Russian Economic Intergovernmental Committee in Moscow, the National Development Ministry told MTI.

Fellegi, who serves as the government's minister commissioner in charge of Hungarian-Russian economic cooperation, and the other members of Hungary's delegation will discuss the potential for cooperation between the two countries in the areas of industry, energy, info-communications, innovation, healthcare and agriculture, the ministry said.

Polish-Russian relations "good" – Sikorskihttp://english.ruvr.ru/2011/03/17/47532857.html

Mar 17, 2011 06:46 Moscow Time

The Polish Foreign Minister is upbeat on the development of bilateral relations with Russia in the past three years. 

Addressing lawmakers in Warsaw on Wednesday Radoslaw Sikorski also said that the trade turnover between the two nations last year had reached $24 billion which is 40% more compared with the same period of 2009.

Russian trade team eyes new Saudi deals

http://www.menafn.com/qn_news_story_s.asp?StoryId=1093399261

(MENAFN - Arab News) A 72-strong Russian business delegation is arrivingin the Kingdom on Thursday, aiming to broaden trade links here insectors such as energy, construction, banking, retail, tourism, healthcare and mass media.

The visit coincides with the Jeddah Economic Forum (JEF) opening onSaturday.

The team is led by Vladimir Evtushenkov, chairman of Russian-ArabBusiness Council and Russian-Saudi Business Council.

He is also the head of Sistema, the largest public diversified financialcorporation in Russia and the CIS, which serves about 100 million consumers.

The president of the Russian republic of Bashkortostan, Rustem Khamitov,adds weight to the high-profile delegation.

Bashkortostan is one of the most developed regions of the RussianFederation in terms of its gross regional output, volume of industrialproduction, agricultural production, and investment in fixed assets.

A key feature of the trade tour will be the Russian-Saudi Business Forumand the Third Russian Exhibition taking place in Jeddah from Thursday toMarch 23.

These events, branded as the Russian Business Week in Saudi Arabia, arejointly organized by the Russian-Arab Business Council (RABC) and theArabia-Expo exhibitions company.

The business forum offers an extensive schedule, including a plenarysession and round-table discussions, bilateral meetings and negotiations.

The Russian-Saudi Business Council is expected to hold its 12th meetingwithin the forum's framework.

Delegation members are also expected to visit key ministries andofficial institutions as well as headquarters of major state-ownedcompanies here.

Organizers said the Third Russian Exhibition, taking place during theJEF, had attracted participants from the Arab region and other parts ofthe world interested in the development of cooperation with the Middle East.

The Russian delegation will also take part in the JEF, hold a specialsession and a series of meetings with Saudi business circles, includinga meeting at the Jeddah Chamber of Commerce & Industry.

The RABC, based in Moscow, is an organization that develops trade andeconomic relations between Russia and Arab states and providesassistance in establishing business contacts between industrialists.

Moving Belene's equipment to Kozloduy NPP will boost price – Rosatomhttp://www.sofiaecho.com/2011/03/16/1060614_moving-belenes-equipment-to-kozloduy-npp-will-boost-price-rosatom

Wed, Mar 16 2011 23:15 CET

Moving the reactor designed for the future Belene plant to Bulgaria's existing nuclear facility in Kozloduy would lift the price of the country's second nuclear capacity significantly, representatives of Russian companies engaged in the project told reporters in Bulgaria on March 16 2011.

The possibility of installing the equipment ordered for the plant in Belene at the Kozloduy NPP was recently presented by Economy Minister Traicho Traikov. According to Traikov, the country could use this option if no agreement on the Belene plant was reached.

"This is not the way nuclear power plants are built. Each plant's construction is based on specific conditions. The site in Belene is suitable and the plant could be built there within the shortest possible time," Kirill Komarov, CEO of Atomenergomash, a subsidiary of Russia's nuclear giant Rosatom, said.

Four months ago, however, the company said that if Bulgaria delayed its decision whether to build the Belene plant, it would sell the reactor to a third party.

Russia also considers that if Bulgaria resorts to moving the reactor to Kozloduy, the project would cost the country more time and money. Bulgaria could also lose a billion euro already invested in the plant if it moved the equipment to the existing power plant, Komarov said.

On a separate note, Rosatom's representative Sergey Novikov said Atomstroyexport was no longer seeking to renegotiate the project's value. The price has been fixed at 6.3 billion euro should construction be completed in 2017, he said.

Novikov said that the Belene project complied with "the most stringent safety standards", with up to 40 per cent of the investment to go for protection equipment and safety systems.

Rosatom: We are not quitting Belene NPPhttp://paper.standartnews.com/en/article.php?d=2011-03-17&article=35777

Sergei Novikov, Rosatom’s spokesperson

THURSDAY, 17 March 2011

- Mr. Novikov, how would you comment the words of EU Commissioner for Energy, Gunther Oettinger, who stated that the Belene NPP project should be reconsidered?- Mr. Oettinger did not mean a reconsideration of the whole project. He wanted to underline that the Belene NPP project needed additional safety grounding. And this will happen in the whole world. Yesterday, Russia’s PM Vladimir Putin stated that the program for the development of Russia’s domestic nuclear energy should be reexamined. As far as I know, during his meeting with the energy ministers of the EU states, Mr. Oettinger said there was no legislative initiative launched. A discussion was held and the companies and governments may organize stress tests to their NPPs and give additional grounding afterwards on a voluntary basis. The energy companies should also decide for themselves if they can afford these procedures financially.- And what could be done regarding the safety of Belene nuke reactors?- Our client – NEK (National Electric Company) should specify what information it needs and we will provide it. If it is necessary to prove that the project meets all current safety requirements, this is clear and we will do it.  - Is it possible the negotiations between NEK and Rosatom to continue after March 31, if additional agreement 12 is not signed?- Atomstroyexport specialists are working at Belene construction site. Their stay and work in a foreign country should have legal reasons. If we don’t sign the next agreement Atostroyexport employees should stop working. Besides in Russia we would have to decide where to deliver the equipment manufactured for the Belene nuke. We want to carry through the Belene project and it is another issue that we have to hold additional talks. By the way, if Atomstroyexport doesn’t get grounds to continue its work in Bulgaria the construction would have to be frozen. And that will cost money, too.Christian Kosturkov

Rosatom reneges on Mantra deal, cites Japan's nuclear crisishttp://au.news.yahoo.com/thewest/business/a/-/wa/9026626/rosatom-baulks-at-mantra-bid-on-japan-crisis/

STUART McKINNON, The West Australian March 17, 2011, 8:58 am

UPDATE 1.25pm: The Australian uranium industry has experienced the first tangible signs of loss from the nuclear emergency in Japan with Russian nuclear agency Rosatom reneging on its proposed $1.2 billion friendly takeover of Mantra Resources.

Rosatom, through its subsidiary ARMZ, has told Mantra it believes recent events at the Fukushima nuclear power plant in Japan had breached a condition of their takeover agreement entered into in December, because the crisis was likely to have a materially adverse effect on the business.

"As such, ARMZ considers that the condition precedent in the (agreement) relating to material adverse change is not capable of satisfaction," Mantra said in a statement.

However Mantra said ARMZ was willing to explore how the transaction could go ahead by way of "an alternative approach" in accordance with its obligations under the (agreement).

Mantra said it was considering its options.

Under the friendly deal announced in December, Mantra shareholders were to receive $8 cash for each share, valuing the company at $1.16 billion.

However recent developments at the Fukushima nuclear power plant, which is leaking radiation and at risk of meltdown following a devastating earthquake and tsunami last week, has prompted a global rethink about the safety of nuclear power and whether it has a viable future as an energy source.

The incident has prompted a massive sell-off of uranium producers and explorers listed on the ASX in recent days.

Mantra's flagship asset is its Mkuju River uranium project in Tanzania.

Shares in the company had plunged $1.84, or 27.5 per cent, to $4.85 by the close of trade, a far cry from the $8 Rosatom had offered to pay shareholders back in December.

Russia: nuclear export hopes hithttp://blogs.ft.com/beyond-brics/2011/03/16/russia-nuclear-export-hopes-hit/

March 16, 2011 6:40 pm by Isabel Gorst

The disaster at Japan’s Fukushima nuclear power plant is reverberating around the Moscow headquarters of Rosatom.

Russia’s state atomic agency has been carving out a role for itself as global exporter of nuclear know-how. But with nuclear programmes coming under new scrutiny around the world, Rosatom will have its work cut out turning projects into hard cash.

Governments earlier planning to diversify away from high emission carbon fuels will now come under pressure to delay nuclear power schemes and accept their dependence on oil, coal and gas.

As the world’s largest oil producer, Russia has plenty to offer in the way of fossil fuels if the world turns its back on nuclear energy. But that won’t help Rosatom. As Sergei

Kiriyenko, Rosatom chief,  has admitted, the Japanese crisis will affect nuclear programmes generally.

But on Wednesday president Dmitry Medvedev put a brave face on the challenge. He met Turkey’s prime minister, Tayyip Erdogan, to discuss Rosatom’s plan to build a $20bn nuclear power plant at Akkuyu on the Turkish Mediterranean, one of the biggest foreign contracts in its portfolio.

Medvedev assured his Turkish visitor that the Akkuyu plant would be able to sustain the most destructive earthquake. “The project that will be realised at Akkuyu is fundamentally different from the one that exploded in Japan both in terms of size and the level of safety,” he said.

Erdogan appeared to agree.  “The atomic station built in Turkey will be a model and an example for the whole of the rest of the world,” he said.

But that may not be enough to satisfy opinion in Turkey, where, as beyondbrics has reported, officials have gone into over-drive to reassure the public.

Meanwhile, other political leaders were showing signs of nervousness about the future of nuclear power as the crisis in Japan spun out of  control.

China, the country with the world’s biggest nuclear power programme , said on Wednesday it was suspending all applications for new nuclear plants – even though on Monday, energy officials publicly backed nuclear power.

In Brussels, Guenther Oettinger, European Union energy commissioner, called for stress tests of all European reactors and raised the prospect of a nuclear-free Europe. He hails from Germany, where Angela Merkel’s government this week launched a review that could lead to the closure of some older plants.

Landed last year, the Turkish contract marked a milestone for Rosatom which is angling for foreign reactor contracts as it plans to double in size and follow France in becoming a global nuclear power (our photo shows a Rosatom plant at Bushehr, Iran). The Russian state enterprise also has orders  to build nuclear plants in Armenia, India and China and is pursuing deals in central Europe and South America.

Older Russian industry officials recall that the 1986 Chernobyl accident cast a pall over the industry for 20 years which had only started to lift very recently.

After Chernobyl, green movements sprang up across the Soviet Union braving official  oppression to demand an end to nuclear power.  The popular protests contributed to the USSR’s collapse five years later.

Today, Russia is increasingly intolerant of environmental lobbyists, seeing them as a potentially dangerous political force. But the greens could rise up again if Rosatom,

frustrated in the pursuit of overseas contracts,  pushes ahead with plans to build new nuclear plants in Russia.

SCO defense ministers sign cooperation plan for 2012-2013http://en.rian.ru/mlitary_news/20110317/163052677.html11:44 17/03/2011

Defense ministers of the Shanghai Cooperation Organization (SCO) member states signed on Thursday a cooperation plan for the period 2012-2013, Kazakh Defense Minister Adilbek Dzhaksybekov said.

The document was signed during a meeting in Astana, the capital of Kazakhstan, which has held the SCO rotating chair since summer 2010.

"Defense ministers of the SCO member states held a session discussing key issues concerning international and regional security and signed a communique and a cooperation plan for 2012-2013," Dzhaksybekov said.

"We are convinced that the close cooperation will help us to strengthen security and stability in the region and in the world," the minister added.

The SCO, created mainly to address regional security concerns, marks its 10th anniversary this June. The organization comprises China, Kazakhstan, Kyrgyzstan, Russia, Tajikistan, and Uzbekistan, while Iran, India, Mongolia and Pakistan hold observer status.

ASTANA, March 17 (RIA Novosti)

SCO defense ministers to meet in Astana on Thursdayhttp://en.rian.ru/world/20110317/163049522.html

06:51 17/03/2011

Defense ministers of the Shanghai Cooperation Organization (SCO) will meet on Thursday in the Kazakh capital of Astana, the Kazakh Foreign Ministry spokesman said.

"During the upcoming meeting, it is planned to discuss issues of international and regional security, the further widening of cooperation between defense ministries of the SCO member states," Askar Abdrakhmanov told journalists in Astana.

The SCO, created mainly to address its member nations' regional security-related concerns, comprises China, Kazakhstan, Kyrgyzstan, Russia, Tajikistan, and Uzbekistan.

Kazakhstan currently holds the rotating chair of the SCO.

ASTANA, March 17 (RIA Novosti)

SCO defence ministers approve 2012-2013 cooperation plan

http://www.itar-tass.com/eng/level2.html?NewsID=16054867&PageNum=0

17.03.2011, 10.49

ASTANA, March 17 (Itar-Tass) -- Defence ministers of the Shanghai Cooperation Organisation /SOC/ adopted a plan for cooperation over 2012-2013, Kazakhstan’s Defence Minister Adilbek Dzhaksybekov said following their meeting on Thursday.

“We have discussed some important issues, exchanged views on the current problems in the international and regional security, signed a communiqu· and a plan for cooperation over 2012-2013,” he told reporters. “We are truly confident that this close cooperation and interaction will let us strengthen security and stability both in the region and in the world.”

“The purpose of all the efforts is to raise trust in security matters and in SOC’s opportunities in fighting terrorism.”

China’s Defence Minister Liang Guanglie said that the documents the sides had signed over the meeting follow the Shanghai agreements and they are based on the major principle of mutual respect, mutual benefit, equality, ongoing consultations and on the aspiration for further development.

“We /the SOC member countries/ will apply every effort to raise our cooperation to a new level,” he said.

Defence ministers confirmed the high level of mutual understanding, gained over the decade of the SOC’s activities. Deepening of communications between defence ministries complies with the fundamental principle of the SOC’s openness and its non-aiming against any state or international union. Once again participants in the meeting highlighted the fact that the purpose of the cooperation is to strengthen measures of trust

in the military sphere, as well as strengthening stability, safety and peace in the region, improvement of counter-terrorist opportunities.

“Providing security in the territory of the organisation is a priority of the organisation’s activities,” the SOC’s Secretary General Murtabek Imanaliyev said following the meeting. “Today’s discussion, I believe, is another proof of further improvement of cooperation between the military of the SOC countries.”

The meeting was organised in the year of the organisation’s tenth jubilee, which is “significant and symbolic,” he added.

The SOC jubilee summit is due on June 15, 2011 in Astana.

March 17, 2011 08:02

Customs union to spark agricultural opportunities for Kazakhstan, China - executive (repeat)http://www.interfax.com/newsinf.asp?id=229274

Shanghai. March 17. INTERFAX-CHINA - A customs union between Russia, Belarus and Kazakhstan will present business opportunities for Chinese companies in Kazakhstan, particularly in agriculture, the head of a business consultancy said March 16.

The customs union, which came into effect on July 6, 2010, is aimed at boosting trade and investment between the three countries by creating a single market between them.

The customs union would create opportunities for Kazakh-Chinese joint ventures in food and agricultural industries, said Liu Chuanwu, president of Huahe International, at a press conference in Almaty, Kazakhstan.

There may be greater demand from China for Kazakhstan-produced cotton, soybean, potato, beet and other crops because of their "high environmental quality," said Liu. Once Chinese companies enter Kazakhstan's market, they will have free access to Russia and Belarus too, he added.

Liu said there would be a short-term negative impact for Chinese firms operating in Kazakhstan as they would have to renegotiate contracts to comply with trade measures introduced by the customs union.

Kazakhstan to render mil-tech aid to Kyrgyzstan

http://www.itar-tass.com/eng/level2.html?NewsID=16055204

17.03.2011, 12.01

BISHKEK, March 17 (Itar-Tass) -- The Defence Ministry of Kazakhstan will render military and technical aid to Kyrgyzstan. As ITAR-TASS learnt at the press service of the ministry, such an agreement was reached at a meeting of Kazakh Defence Minister Adilbek Dzhaksybekov with Kyrgyz Defence Minister Abibilla Kudaiberdiyev in Astana.

“During the meeting, the heads of the defence departments signed an agreement between the government of Kyrgyzstan and the government of Kazakhstan on rendering gratuitous military aid,” a representative of the press service said. The document envisages the transfer of nine GAZ-66 cars, eleven ZIL-131 cars, five armoured personnel carriers and thirty PM-120 mortars.

Kudaiberdiyev expressed gratitude to his colleague and noted that Kyrgyzstan’s assistance in the field of training military cadres at military educational establishments of Kazakhstan is one of the priority directions of the two republics’ military and technical cooperation.

“Some 70 Kyrgyz servicemen concluded training at institutes of higher education of the Kazakh Defence Ministry on a gratuitous basis within the framework of the bilateral agreement on training military cadres for CSTO member-state from 1998 to 2010,” the representative of the press service stressed. “At the given moment, more than 110 Kyrgyz servicemen continue studying at military educational establishments of the neighbouring country.

Natalia Yacheistova: Kyrgyzstan is the main contender for recipient status within Russian international programs 17/03-2011 11:31, Bishkek – 24.kg news agency , by Tolgonai OSMONGAZIEVA

“Kyrgyzstan is the main contender for recipient status within Russian international programs,” Natalia Yacheistova, Deputy Chief of Department for CIS Development Assistance Rossotrudnichestvo, said at 5th session of Kyrgyz-Russian working group on intergovernmental agreement for migrants protection.

According to her, the programs were developed at three areas: technical education, meals for students, and advancement of school education. “Nowadays, the programs are at the coordination stage in different agencies of Russia. We are going to cooperate with the Kyrgyz Republic in all areas,” said Natalia Yacheistova.

URL: http://eng.24.kg/community/2011/03/17/16937.html

Omurbek Abdyrakhmanov: Kyrgyzstan should nationalize 100 percent of MegaCom shares 17/03-2011 08:04, Bishkek – 24.kg news agency , by Darya PODOLSKAYA

“Kyrgyzstan should nationalized 100 percent of shares in MegaCom,” Ata Meken faction member Omurbek Abdyrakhmanov told reporters today.

He said “the concerned parties should first define the share of Russian businessmen in the company before implementing any nationalization policy”. “As was previously reported, I have insisted on establishment of a parliamentary commission to study all 47 of the nationalized objects, including Alfa Telecom. It is composed of three deputies from each faction. We are verifying the legality of the decrees issued by the interim government, giving the right to expropriate affiliated companies. A working group is chaired by the deputy of the faction “Ar-Namys” Akylbek Zhaparov. The group should provide a detailed study of the situation surrounding MegaCom and find out what relation does First vice Prime Minister Omurbek Babanov have towards the company,” he said.

URL: http://eng.24.kg/community/2011/03/17/16917.html

Kyrgyzstan and Russia to create vacancy database17/03-2011 11:02, Bishkek – 24.kg news agency , by Tolgonai OSMONGAZIEVA

Chambers of Commerce and Industry (TPP) of Kyrgyzstan and Russia are going to create joint vacancy database for labor migrants, as Senior Vice President of Russian Chambers of Commerce and Industry Valery Malakhov said today at the session of Kyrgyz – Russian working group on intergovernmental agreement for migrants protection.

According to him, the migration processes shall be regulated. “Section of both legislation related issues and vacancies shall be developed at web-sites of Chambers of Commerce and Industry of Kyrgyzstan and Russia. The information will be available for citizens of both countries. There are 173 representative offices of TPP at the territory of RF. In addition, anti-crisis centers shall be established, in particular at the regional level,” said Valery Malakhov.

Russian official also said that TPP of RF could work out united integration mechanism for migration related issues. “Relevant laws shall be passed for this purpose, including at the regional level. It is necessary to improve migrants’ skill, as well as teach them Russian language. We are ready to participate in the program for attraction of promising specialists, including businessmen. It means that there will be labor migration from Russia to Kyrgyzstan. We need CIS united labor market,” added Valery Malakhov.

URL: http://eng.24.kg/cis/2011/03/17/16934.html

Anatoly Kuznetsov: Russia cooperates with Kyrgyzstan addressing migration issues at the highest level 17/03-2011 08:42, Bishkek – 24.kg news agency , by Tolgonai OSMONGAZIEVA

“Russia cooperates with the Kyrgyz Republic in addressing migration issues at the highest level,” Deputy Director of the Federal Migration Service of the Russian Federation Anatoly Kuznetsov said today at the V meeting of the Kyrgyz-Russian Working Group on Intergovernmental Agreement on the Protection of Migrants.

According to him, some of the events that hit the country in 2010 negatively affected cooperation ties. “Despite the break in relations, we were working strenuously. We are going to establish in the technical vocational school in Kant (Chui province) a branch of the Kazan Technological University to provide optional assistance,” he said.

As noted by the rector of the university Ilnur Abdullaev, the training will begin from new school year. “The students will be able to complete primary, secondary, tertiary and technical education, as well as post-graduate training and retraining courses,” he stressed.

Besides, the Minister of Labour, Employment and Migration of KR Almasbek Abytov said that vocational education became popular in the republic. “As the practice shows, 85 percent of college graduates can not find work, in contrast to young people who have chosen technical specialty,” he added.

URL: http://eng.24.kg/politic/2011/03/17/16921.html

Almazbek Abytov: Two fifth of Kyrgyzstan’s population is involved into migration processes 17/03-2011 09:05, Bishkek – 24.kg news agency , by Tolgonai OSMONGAZIEVA

“Two fifth of Kyrgyzstan’s population is involved into migration processes,” Minister of Labor, Employment and Migration Almazbek Abytov said today at 5th session of Kyrgyz-Russian working group on intergovernmental agreement for migrants protection.

According to him, migration processes are significant for social-economic life of the country. “Majority of Kyrgyz labor migrants work at the territory of Russia. Kyrgyzstan and Russian Federation cooperate within SCO and CSTO,” said Almazbek Abytov.

URL: http://eng.24.kg/community/2011/03/17/16923.html

Vitaly Orosaliyev: Russia is concerned with forming anti-drug belt across Kyrgyzstan17/03-2011 09:06, Bishkek – 24.kg news agency , by Makhinur NIYAZOVA

“Russia is concerned with forming anti-drug belt across Kyrgyzstan and strengthening drug control service,” chief of State Drug Control Service (GSKN) Vitaly Orosaliyev stated at the press conference.

According to him, this is exactly the reason why Director of the Russian Federal Service for Drug Control Viktor Ivanov arrived in Kyrgyzstan yesterday. “We have signed the protocol about rendering financial and material assistance. Today the question is providing the service with material and technical resources. Material and technical base was lost during the reorganization, in particular cars, special equipment and some part of the building. This project will let drug control service supplement material and technical base,” stressed Vitaly Orozaliyev.

He noted that the republic will receive over $6 millions within the project of 3 years duration period. “Money will be also spent on financial incentives of workers for real results.”

“Cooperation between services of both countries reached high level. We are planning to improve interregional cooperation involving Tajikistan, Kazakhstan, and Uzbekistan. We have conducted near 40 combined operations with Russia since existence of Drug Control Service in Kyrgyzstan and seized over 20 tons of drugs,” concluded Mr. Orozaliyev.

URL: http://eng.24.kg/community/2011/03/17/16924.html

Russian human rights activist to be deported from Belarushttp://en.rian.ru/world/20110317/163047853.html

04:01 17/03/2011

Russian human rights activist Andrei Yurov has been detained in Belarus and will be deported from the country, his colleague Vladimir Lobkovich told RIA Novosti on Thursday.

"Yurov was detained on Wednesday in Minsk," Lobkovich said.

According to Lobkovich, Yurov heads an international mission monitoring the situation with human rights in Belarus.

The New York based non-governmental organization Human Rights Watch called on Monday for the United Nations Human Rights Council to adopt a resolution condemning recent human rights abuses in Belarus.

Hundreds of people were detained during large-scale protests that broke out in Minsk in December following presidential elections, which saw Belarusian long-standing leader Alexander Lukashenko win a landslide victory with almost 80 percent of the vote.

At least 725 people were sentenced to between 10 and 15 days in prison following the crackdown, according to a report issued by Human Rights Watch. The report details raids on human rights organizations, denial of access to defense council and government pressure on lawyers representing those detained.

The Belarusian authorities are still investigating more than 46 individuals on riot charges related to the December protest, including seven former presidential candidates. Four have already been convicted and sentenced to up to four years in prison. Two Russians have been released but requested to pay hefty fines.

MINSK, March 17 (RIA Novosti)

Parliamentarian sees no future for modernization program without Medvedevhttp://rt.com/politics/parliamentarian-sees-modernization-medvedev/print/

Published: 17 March, 2011, 10:19Edited: 17 March, 2011, 11:47

Deputy Head of the Fair Russia faction and head of the Go Russia movement Gennady Gydkov said that continued modernization of the country is only possible if President Dmitry Medvedev remains in office.

Go Russia was set up last September and named after an eponymous 2009 program article by Dmitry Medvedev in which he stressed the need for the country’s modernization in all spheres. Under the term he, first of all, meant building a new economic model based on high-tech and building civil society.

Gudkov’s statement follows a report by the Institute of Contemporary Development (INSOR), released earlier this week. The document titled “Finding the Future. Strategy 2012, an Outline” suggests that if Dmitry Medvedev is elected to a second term as president, he stands a chance of genuinely modernizing Russia.

Gudkov says that he agrees with many of the report’s points. One of them is the need to resume elections on all levels, he stressed.

In other news, First Deputy Prime Minister Igor Shuvalov, who is in charge of economic issues in the cabinet, said that Russia needs “significant transformation” but “without disturbances”. Speaking at a conference called “Russia and the World: In Search of the Innovative Strategy”, he pointed out that it is essential there is no dramatic change of power to implement the modernization program. Revolutions in Africa and the Middle East are, in his opinion, a negative example of rapid changes at all costs.

“These countries will go through poverty, disastrous perturbation and personal tragedies,” the minister said. A drastic change in Russia’s political course could bring even worse problems, he added.

With a year left ahead of the next presidential election, there is much speculation about whether Dmitry Medvedev and Vladimir Putin will run for new terms.

PRESS DIGEST - Russia - Mar 174:14am EDT

http://www.reuters.com/article/2011/03/17/press-digest-russia-mar-idUSLDE72G0CM20110317

MOSCOW, Mar 17 (Reuters) - The following are some of the leading stories in Russia's newspapers on Thursday. Reuters has not verified these stories and does not vouch for their accuracy.

KOMMERSANT

www.kommersant.ru

- Russia's Foreign Ministry on Wednesday announced the evacuation from Japan of Russian embassy staff and their families, the daily writes.

- Russia's Central bank recommends that Sberbank (SBER03.MM: Quote, Profile, Research, Stock Buzz) increases 2010 dividends to 12 percent of pure income, which is about 21 billion roubles ($731.2 million), the daily says.

- Private investors will spend $1.19 billion on building parking lots and garages in Moscow in 2011, the paper reports.

VEDOMOSTI

www.vedomosti.ru

- Kremlin proposed significant amendments to the criminal law, the paper writes.

- Despite a rise in oil prices, Russia lost $6 billion in foreign capital in February, the daily says.

- The daily runs an interview with Stephen Elop, the CEO of Nokia (NOK1V.HE: Quote, Profile, Research, Stock Buzz), the world's top cellphone maker by volume.

IZVESTIA

www.izvestia.ru

- There has been a spike in the number of bomb-scare, telephone threats to administrative buildings in Russia's North Caucasus, Moscow and other cities in Central Russia in the recent weeks, the daily writes.

Russian Press at a Glance, Thursday, March 17, 2011http://en.rian.ru/papers/20110317/163050519.html

08:39 17/03/2011

POLITICS

Turkey on Wednesday reiterated its commitment to a Russian-built nuclear plant, but Moscow made it clear that something has gone wrong in another key area where it has counted on Ankara's support: the South Stream pipeline.

(The Moscow Times, Kommersant, Vedomosti, Rossiiskaya Gazeta)

Russian First Deputy Prime Minister Sergei Shuvalov told participants in an international conference in Moscow on Wednesday that Russian society is facing a "significant transformation."

(Kommersant)

Roman Panov, a Russian deputy minister for regional development, tells Kommersant about the reconstruction of South Ossetia, a former Georgian republic that Russia recognized after a five-day war with Georgia in August 2008.

(Kommersant)

ECONOMY

The Kremlin's own estimates show that the government loses 1 trillion rubles ($34.9 billion) every year through rigged state tenders.

(The Moscow Times)

SOCIETY

Concerns are growing in Russia's Far East about a possible radiation threat from Japan. Radiation detectors and iodine have sold out in many shops in Kamchatka and Sakhalin, as well as flight tickets to Moscow until the end of the week. Local authorities have maintained that the radiation level in the region remains within the norm.

(Kommersant, Moskovsky Komsomolest)

Police will no longer be allowed to collect fines from foreigners with invalid or missing registration papers, according to a bill aimed at easing registration rules approved by the upper house of the Russian parliament, the Federation Council.

(The Moscow Times)

Russian opposition leaders Ludmila Alexeyeva and Eduard Limonov have applied to the Moscow Mayor's Office for permission to hold meetings in support of freedom of assembly in Moscow on March 31. They want to stage meetings on two central Moscow squares instead of the usual one and march along the capital's main street.

(Kommersant)

The Kremlin has proposed groundbreaking amendments to the Russian Criminal Code: no prison terms for first-time committers of minor offences, for businessmen who have compensated for damage caused by their operations, and for those involved in illegal goods trafficking.

(Vedomosti)

BUSINESS

The Moscow authorities headed by new mayor Sergei Sobyanin have frozen a total of 53 construction projects in the capital, one in five projects examined.

(Vedomosti)

Sberbank, the country's biggest lender, is looking to technological innovation to stabilize its declining share of the retail banking market.

(The Moscow Times)

Nokia head Stephen Elop tells Vedomosti about the Nokia Windows Phone and his company's success in Russia. The country accounts for one quarter of Nokia's sales.

(Vedomosti)

A year after President Dmitry Medvedev first spoke about Skolkovo, the Silicon Valley-type hub near Moscow, Hewlett-Packard has still not joined the rush to participate in it.

(The Moscow Times)

Russian billionaire Alisher Usmanov will extract copper and gold from the seabed in partnership with the government of Papua New Guinea.

(Vedomosti)

March 16, 2011

U.S., Russia offer sites for figure skating worlds this spring http://newsblogs.chicagotribune.com/sports_globetrotting/2011/03/us-russia-offer-sites-for-figure-skating-worlds-this-spring.html

By Philip Hersh

Little did I know how accurate my Alice-in-Wonderland references from an earlier blog about the fate of the World Figure Skating Championships would prove to be.

The latest developments in the Mad Tea Party:

Russia and the United States now have joined the festivities by offering alternate sites for the event that was supposed to begin Monday in Tokyo but has been postponed indefinitely because of conditions in Japan following last Friday's earthquake and tsunami.

I have learned U.S. Figure Skating wrote the International Skating Union Wednesday to propose that the 2011 worlds be held either in Colorado Springs or Lake Placid, N.Y. in late April or early May.

According to allsportinfo.ru, the Russian Minister of Sport has written the International Skating Union to propose the event go to Moscow ``in the very near future.''

``Yes, it will be difficult, hard, expensive,'' Yuri Nagornykh, the vice-minister of sport, was quoted as saying in the allsport story.  ``But we felt it was right to (give) the ISU a friendly shoulder.''

In an interview I did with ISU president Ottavio Cinquanta earlier today, he downplayed the possibility of moving worlds to another site in April or May because of both the short

preparation time and problems with skaters who already have contractual obligations to other events in that time period.

Both Turin, Italy and Malmo, Sweden, also have let it be known through media reports that they are interested in taking over the worlds this spring if the ISU chooses to move it from Japan.  The ISU is in discussions with the Japanese Skating Federation about the possibility of having the worlds in Tokyo in October.

The Herb Brooks Arena, Lake Placid's 7,700-seat rink, was the site of the 1980 Olympic figure skating as well as three editions of Skate America, most recently in 2009.

The 8,000-seat World Arena in Colorado Springs has three times been used for Skate America and twice for the Four Continents Championship, scheduled to go there again next season.

The 2005 worlds took place in Moscow, which would have a huge advantage over the U.S. sites in terms of lodging and access, since the city has two international airports and direct flights to and from most of the world.

National Economic Trends

Central Bank asks Sberbank to up dividends

http://www.rbcnews.com/free/20110317105008.shtml

      RBC, 17.03.2011, Moscow 10:50:08.Central Bank will advise Sberbank to raise its dividend payouts for 2010, Central Bank's First Deputy Chairman Alexey Ulyukayev told reporters late Wednesday. He did not specify the amount, however.

      According to Sberbank CEO German Gref, the bank should disburse 10 percent of net profit in dividends. The bank allocated RUB 2.18bn (approx. USD 76m) or 10 percent of its net profit in dividend payouts for 2009. Central Bank owns over 60 percent of voting shares in Russia's largest bank Sberbank.

Russia May Ask Sberbank to Increase Dividends, Kommersant Sayshttp://www.bloomberg.com/news/2011-03-17/russia-may-ask-sberbank-to-increase-dividends-kommersant-says.html

By Stephen Bierman - Mar 17, 2011 6:13 AM GMT+0100

Russia’s central bank, the main shareholder in OAO Sberbank, may ask the bank to increase dividend payouts for 2010 to 12 percent of net profit, Kommersant reported, citing Alexei Ulyukayev, the central bank’s first deputy chairman.

The possibility may be examined on March 21 at a Sberbank supervisory board meeting, the newspaper cited Ulyukayev as saying. Sberbank bank is currently set to pay 10 percent of net income as dividends, Kommersant said.

To contact the reporter on this story: Stephen Bierman in Moscow sbierman1@bloomberg.net.

To contact the editor responsible for this story: Will Kennedy at wkennedy3@bloomberg.net.

Russia's improving macroeconomics pushing fights amongst officials once more

http://www.bne.eu/dispatch_text14484

bneMarch 17, 2011

In light of the momentous events around the globe, Russia is eyeing quicker growth and an improved budget in 2011. Commentary from officials surrounding this improved performance is heating up, as ministries push their macroeconomic agendas.

With unrest in the Middle East and North Africa continuing, and a massive reconstruction effort in Japan on the cards following the earthquake and tsunami earlier this month, higher commodities prices look set to see Russia outperform expectations this year.

This week, the Ministry of Finance in particular has the pedal to the metal, pushing the case for a vastly reduced budget deficit - or even a break even - as it seeks to head off calls for tax breaks and other growth stimuli demanded, first and foremost, by the oil industry.

Finance minister Alexei Kudrin suggested on Monday that, in the face of official projections of a deficit of 3.6% of GDP in 2011, elevated oil prices may actually push the budget out of the red. On Wednesday, Kudrin pushed again, suggesting oil prices could surge as high as $200 due to global events, and pouring cold water on a recent request from Rosneft for further tax breaks at the Vankor field. "We will consider it, but oil prices are high and one can't say it's not profitable to operate the field," he said at a banking conference, according to Prime Tass.

Alexei Ulyukayev, first deputy chairman of the Central Bank of Russia, moved to back Kudrin's call on the budget yesterday, as he also forecast a possible break even for the budget. He added that the bank is ready to match his words with action, as he spoke of fighting inflation via further flexibility for the ruble and interest rates, thus signaling that rising prices are now much more of an issue than growth.

The acceleration of such comments in recent weeks suggests that financial liberals are clearly concerned that, especially ahead of the Duma elections in December and next year's presidential vote, the spectre of another wave of petrodollars could sweep aside reform and fiscal prudence, as it has in the past.

Meanwhile, the likes of the Economic Development Ministry remains far more conservative, hence whilst deputy minister Andrei Klepach also noted the economy's accelerating performance yesterday, he suggested a target of a 1% deficit at best.

Russia - Emerging Markets Briefer

http://www.bne.eu/dispatch_text14484

Danske BankMarch 16, 2011

Macro Outlook

- Russian GDP grew by 4% in 2010 according to the first estimate, well in line with the government prediction and our own growth forecast. Unfortunately, the growth was driven by growth in inventories and thus domestic demand was still sluggish.

- We continue to highlight the role of the banking sector: stagnant bank lending growth has dampened the economic performance in 2010, but we expect rapid lending growth to support consumption and investments in 2011.

- We have upgraded our average oil price forecast from the previous USD94 to USD111 in 2011 on the back of the turmoil in the Middle East and North Africa. Russia seems to be one of the few countries that benefits from the turmoil, as it is extremely unlikely that the turmoil will spread to Russia, yet the high oil price supports the Russian economy.

- Unemployment remained relatively low and wage growth was robust in 2010, except for the last couple of months of the year as accelerating inflation dampened real wage growth. However, productivity is low in many sectors and there are some serious local unemployment problems in some cities that were built around one factory in the Soviet

era.

- Industrial production growth has remained robust, even though the benign base effect is fading. We hope to see an investment-driven recovery in late 2011, which is likely to support more domestic production than the current consumption-led growth..

FX & Monetary Policy Outlook

- In its February meeting, the Central Bank of Russia (CBR) hiked its all key interest rates by 25bp and it also increased the reserve requirements.

- We expect the CBR to hike rates as early as end-March, as inflation continues to accelerate. Other policy measures, such as reserve requirements and stronger rouble, are likely to be used as well to curb inflation.

- The central bank has widened the corridor of fluctuations of the rouble against the currency basket. However, the CBR continues to intervene if it sees excess volatility in rouble markets.

- We expect inflation to accelerate to above 10% y/y by end-March, driven by money supply growth, commodity prices and producer prices.

Risk Factors

- Russia's dependence on the global oil price poses the greatest risk to the economy.

- The risk of loose fiscal policy increases as the 2012 presidential elections approach.

- In the longer term, consumption-driven growth is no longer sustainable, as without significant investments, the Russian economy will face severe bottlenecks due to its outdated infrastructure.

Risk Factors

- Russia's dependence on the global oil price poses the greatest risk to the economy.

- The risk of loose fiscal policy increases as the 2012 presidential elections approach.

The government needs foreign capitalhttp://rt.com/politics/press/nezavisimaya/economy-russia-modernization-business/en/print/

Published: 17 March, 2011, 07:07Edited: 17 March, 2011, 08:26

By Sergey Kulikov

There are not enough internal funds for the country’s modernization

The Russian authorities’ plans for modernization have encountered a prosaic obstacle: investors do not wish to invest capital into Russia. Yesterday, First Deputy Prime Minister Igor Shuvalov announced that he is not expecting to collect the necessary resources from Russian citizens. The government, according to him, is hoping for a major influx of foreign capital, without which the declared modernization is simply impossible. Meanwhile, the situation with investments is lamentable – despite the high oil prices, Russia’s funds continue to diminish: $13-14 billion in January-February alone. Experts believe that Russia does have the needed capital, but there are no guarantees it will be protected. Therefore, the traditional demands presented to the authorities to work on reducing corruption levels, perfect legislation and eliminate administrative barriers are becoming more and more relevant.

“In any event, modernization requires large capital, which is still limited in the country,” Shuvalov stated at a conference titled “Russia and the World: In Search of an Innovation Strategy.” “We are expecting to attract a large amount of foreign capital.” 

Meanwhile, he noted that we should not lose sight of the competition for capital, which we will be forced to win.

“All the issues we are discussing concerning the improvement of the investment climate are already on the agenda of those states that already have a positive investment climate, such as in Great Britain, for example,” he explained. “But if they have resolved this problem, then for us it is a part of today’s agenda – legal institutions, protection of private property, and much more.”  

Due to this fact, he referred to the calls to change leadership in Russia silly.

“Will anything change with the institutions? I’ll say it at once: In Russia, when such political changes occur suddenly, institutions only get worse,” he said.

Shuvalov also castigated the population for corruption, which is flourishing in the country and to which, according to him, the public has grown accustomed.

“When we say that Russia in 2020 is an economically powerful Russia with comfortable living conditions, it is a realistic scenario – but only if each of us is ready for real changes,” he said. 

Meanwhile, shortly before Shuvalov’s address, while commenting on the speeches of the other presenters, the event’s moderator, the rector of the Russian Presidential Academy of National Economy and Public Administration, Vladimir Mau, cited what in his opinion is an all-too-common example: “During a period of new economic policies, one businessman was asked why he does not keep his money in a Soviet bank; after all, the

government does provide assets protection. The problem is, answered the businessman, that it does not guarantee my protection.”

This was an illustrative answer to the question of why there are not enough funds for modernization within the country.   

“Russia is no longer a country with low costs of labor and raw materials,” the general director of Severstal, Aleksey Mordashov, complained during his speech. “In some of our regions, electricity tariffs are higher than in the European Union.”

In the course of the presentation, Mau asked forum participants to evaluate the consequences of possibly strengthening the national currency.

“It’s understandable that, in this case, export-oriented businesses will start losing profits, but a concurrent rise in the population’s purchasing power will open the opportunity for the development of other production,” noted Mordashov. “But it is important for this to be an objective process, because strengthening the ruble artificially is very dangerous.”

Meanwhile, the Central Bank’s first deputy chairman, Aleksey Ulyukayev, noted that he sees tendencies for both strengthening and weakening of the ruble in the short term.   

According to experts, today there is no reason to believe that resources will begin flowing into Russia. Recall that last year, capital outflow amounted to about $40 billion, and in the two first months of 2011, to another $13-14 billion. And that is despite the high oil prices. 

“To attract capital, it is necessary to improve the investment climate in the country, while artificially attracting the needed resources does not make sense,” argued Anton Safonov, an analyst with Investcafe. “There is money in the country, but investments must be protected.”

Meanwhile, expert recommendations are known: to raise the country’s investment attractiveness while perfecting the legal system and other institutions, reducing the number of administrative barriers, fighting corruption, among other measures. “Despite the fact that authorities are recognizing the existence of such barriers, we are not seeing any real progress,” added Safonov.

Business, Energy or Environmental regulations or discussions

Russia Stocks Advance as Oil Gains on Growing Middle East Unresthttp://www.bloomberg.com/news/2011-03-17/russia-stocks-advance-as-oil-gains-on-growing-middle-east-unrest.html

By Jason Corcoran - Mar 17, 2011 10:12 AM GMT+0100

Russian stocks climbed for a second day as oil prices rose after fighting in Libya, Africa’s third- largest crude producer, renewed concern Middle East supplies may be threatened by escalating civil unrest.

The Micex Index added 0.8 percent to 1,718.83 by 11:50 a.m. in Moscow. OAO Rosneft, Russia’s biggest oil producer, increased 1.7 percent to 256.7 rubles. OAO Gazprom, the country’s gas export monopoly, added 1.3 percent and OAO Sberbank, its largest lender, gained 1.1 percent. The dollar-denominated RTS Index rallied 0.5 percent to 1,925.46.

Oil, Russia’s chief export earner, rose as much as 1.3 percent to $99.20 a barrel in New York. Regional unrest, which has cut Libya’s crude production by 1 million barrels a day, has worsened in Bahrain. The government yesterday declared a three- month state of emergency after troops from Saudi Arabia and other Gulf states arrived to help quell a month of protests driven by Shiites calling for democracy and civil rights.

“‘Portfolio managers see Russia performing well in high- volatility, risk-averse environment and are allocating accordingly,” Julian Rimmer, a trader of Russian shares at CF Global Trading in London, said in e-mailed comments. “Middle East and North African unrest gives crude a backstop.”

Copper on the London Metal Exchange climbed as much as 0.5 percent to $9,307 a metric ton. All of the six main metals on the LME increased. OAO GMK Norilsk Nickel, Russia’s biggest miner, rose 0.5 percent to 7,047 rubles.

To contact the reporter on this story: Jason Corcoran in Moscow at jcorcoran13@bloomberg.net

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

Moody's says mergers and acquisitions will strengthen Russian banking sectorhttp://finchannel.com/news_flash/Banks/83255_Moody%27s_says_mergers_and_acquisitions_will_strengthen_Russian_banking_sector/

17/03/2011 03:42 (01:49 minutes ago) The FINANCIAL -- MOSCOW . According to a Special Comment published by Moody's Investors Service, merger and acquisition (M&A) activity in the Russian banking system gained traction in 2010, a trend that is likely to accelerate in 2011.

"Moody's considers this to be credit positive because the Russian banking system will benefit from increased economies of scale and a reduction in the number of very small, fundamentally weak banks within the system," explains Eugene Tarzimanov, a Moody's Vice President -- Senior Analyst.

M&A activity had already gained pace in 2010 across all banking segments: both government-owned and private banks, MOSCOW -based as well as regional banks and domestic/foreign-owned institutions. Going forward, many deals will take place between sister or partner banks as a part of internal consolidation strategies. However, given favourable conditions, Moody's also expects to see more inter-group deals that carry the potential to create a stronger mid-layer of banks.

"The conditions are in place for M&A activity to gain momentum in Russia. Banks have the means to finance deals, evidenced by a high share of liquid assets and increased access to debt financing. Many banks also have excess capital which they are looking to utilise. Lower M&A valuations following the crisis, combined with accelerating credit growth also stimulate M&A demand," notes Mr Tarzimanov.

In addition to market-driven factors, M&A activity will be fostered by increased minimum capital requirements from currently RUB90 million to RUB180 million in January 2012, since this provides smaller institutions with the incentive to merge with (or acquire) other banks in order to jointly meet the higher requirements. Regulators have also paved the way for more M&A, by easing the administrative requirements for bank mergers in 2010.

In particular, consolidation among the larger private banks will yield benefits from scale and geographical coverage, and will create players that might be better able to compete with the large state-controlled banks that control 50% of banking assets. Concentration at the top will nevertheless remain strong, as large banks such as Bank VTB are also actively acquiring new assets.

The expected continued dominance of the state banks is positive for their creditors, but will likely remain a credit-negative factor for creditors of privately-owned banks, whose franchise development will remain restricted by their inability to compete head-on against the state banks.

We also note that M&A activity is only one of many factors that will drive the credit profiles of Russian banks in the near term. "While M&A can have a significant impact on the credit profile of involved banks, increased M&A activity will unlikely change the structure of the Russian banking system given the strong market position of the government-controlled banks. Therefore, the overall market-wide credit implications will be relatively modest, although they contribute to our overall stable outlook for the Russian banking system in the near term," concludes Mr Tarzimanov.

UPDATE 1-Sekerbank shares jump on report of Sberbank interesthttp://in.reuters.com/article/2011/03/17/sekerbank-idINLDE72G08Y20110317

1:46pm IST

* Sekerbank says sale not on its agenda

* Sources say Sberbank's focus is on Troika not new deals

* Sekerbank shares rally at the open

(Adds background, detail, Sberbank no comment)

ISTANBUL, March 17 (Reuters) - Turkish lender Sekerbank (SKBNK.IS: Quote, Profile, Research) said on Thursday it was not for sale, after Turkish daily Vatan reported Sberbank (SBER03.MM: Quote, Profile, Research), Russia's largest bank, wanted to buy it.

Sekerbank said in response to the report that a sale was not on its agenda.

Sberbank, which said last week it was interested in Turkish opportunities, declined to comment.

Sekerbank shares opened more than 9 percent higher.

Vatan said Sberbank had hired Alessandro Profumo, former chief executive of Italian bank Unicredit (CRDI.MI: Quote, Profile, Research), to consult on the acquisition.

Last Friday, Sberbank bought Troika Dialog, Moscow's oldest brokerage, for $1 billion. The Russian bank took over the stake owned by Troika's founders and a 36.4 percent stake owned by South Africa's Standard Bank (SBKJ.J: Quote, Profile, Research). [ID:nLDE72A0E4]

At the same time, Sberbank CEO German Gref said the lender was interested in Turkish acquisition opportunities, but was not in talks over taking stakes in Turkish state-run lenders Ziraat or Halkbank (HALKB.IS: Quote, Profile, Research) which the government has said could be sold this year.

Sberbank's immediate focus is expected to be on completing the Troika acquisition before actively considering other deals sources said on Thursday.

Sekerbank, which means sugar bank and was founded in 1953 to pool the savings of cooperative sugar growers, is 34 percent owned by BTA Bank of Kazakhstan, 34 percent owned by its own pension fund, with the remaining 32 percent publically traded. The private sugar and beetroot factories co-operative retains a stake of 0.08 percent.

Last year, Sberbank had considered buying General Electric's (GE.N: Quote, Profile, Research) stake in Garanti (GARAN.IS: Quote, Profile, Research) but decided against bidding. The stake was eventually bought by Spain's BBVA (BBVA.MC: Quote, Profile, Research). (Writing by Seda Sezer and Alexandra Hudson; Editing by Hans Peters and Jane Merriman)

Russia's VEB to start syndication next week – sourceshttp://in.reuters.com/article/2011/03/17/russia-veb-loan-idINLDE72G0FS20110317

2:02pm IST

MOSCOW, March 17 (Reuters) - Russia's state development bank VEB may start a syndication of a three-year loan next week, with rate seen at LIBOR plus 130 basis points, three banking sources told Reuters on Thursday.

"They are planning to start the syndication next week," one source said. Two other sources confirmed, adding that VEB is looking at the rate of LIBOR plus 130 basis points.

"That is that what market is talking about, the rate is not final," one of the sources said.

VEB's chief executive Vladimir Dmitriev said earlier this month that the bank, Russia's government main investment vehicle, plans to raise more than $2 billion via a syndicated loan by mid-year. [ID:nLDE7201BO]

(Reporting by Oksana Kobzeva and Katya Golubkova, editing by Lidia Kelly)

Rusagro voices London IPO plans http://www.rbcnews.com/free/20110317123500.shtml

      RBC, 17.03.2011, Moscow 12:35:00.Rusagro expects to raise at least $300m in an IPO on the London Stock Exchange, the agricultural holding told RBC today. The company will offer depositary receipts on the additional shares of RosAgro Plc.

      Rusagro had originally planned to sell 28.6 percent of its share capital for $245m-309m in early 2010, but cancelled the offering after investors requested a nearly 15-percent discount at the lower end of the bookbuilding range set at $13.5-17 per share.

MARCH 17, 2011, 4:33 A.M. ET

VimpelCom Faces Tough Vote on Tie-Up http://online.wsj.com/article/SB10001424052748703818204576205921366976678.html?mod=googlenews_wsj

By NADIA POPOVA And WILLIAM MAULDIN

MOSCOW—Russian mobile-phone company VimpelCom Ltd. faces a tough shareholder vote Thursday to approve a $6.1 billion tie-up that would create world's fifth-largest telecom operator, amid fierce opposition from major shareholder Telenor ASA.

The vote on the acquisition of Egyptian billionaire Naguib Sawiris' heavily indebted telecom assets follows weeks of legal wrangling and public fights with Norway's Telenor. Minority investors will be the key to solving the deadlock between Telenor, which holds a 36% voting stake in VimpelCom, and Russian conglomerate Alfa Group, which has 44.6% of the votes.

Many analysts believe that with Alfa's clear lead in voting shares, the deal is likely to pass despite Telenor's opposition. Yet a fall in VimpelCom's stock price indicates the merger isn't popular with the minority investors in VimpelCom's New York-traded shares.

Alfa Group's Altimo telecom holding needs to gain the support of 5.4% of minority votes, assuming 100% turnout, to clinch the deal. VimpelCom said the merger would more than double its footprint of potential emerging-markets subscribers and diversify the currency makeup of its revenue stream.

The Wind deal would secure a more than 50% stake in Orascom Telecom, the Arab world's largest mobile-telephone operator by subscribers, and Italy's Wind Telecommunicazioni SpA.

Telenor points out that Italy is a mature market and the deal would double VimpelCom's debt compared with pretax earnings. Moreover, Djezzy, the Algerian unit of Orascom Telecom and its greatest source of revenue, may be nationalized by the Algerian government in a dispute over taxes.

"I am against the deal," said a Moscow-based private shareholder with around $200,000 invested in VimpelCom. "The company's management has adopted too aggressive a strategy that is unacceptable, with major shareholders having opposite views on the operator's development."

Also voting against the merger is a large Russia-focused investment fund that requested anonymity because of the sensitivity of VimpelCom's major shareholders.

"There is a big number of passive minorities, and a part of them are going to vote against the deal," VTB Capital analyst Victor Klimovich said. "There are just a few minority shareholders supporting the transaction."

Still, Carnegie analyst Espen Torgersen said Telenor's chance of stopping the transaction looks very small.

Under the acquisition terms, VimpelCom will pay Wind Telecom $1.495 billion in cash, while Wind will also get 325.6 million new VimpelCom common shares and 305 million new convertible preferred shares, which have voting rights. Wind won't get board seats unless a new shareholder agreement is signed at a later date.

On Thursday, VimpelCom shareholders are voting on the additional share issue, which is the final stage of the Wind acquisition.

Telenor has sought to protect its right to buy additional shares as part of the deal, both in arbitration proceedings and in a London commercial court.

When a shareholder of Altimo bought a small minority stake in Orascom, VimpelCom's deal with Sawiris effectively became a related-party transaction, causing Telenor to lose preemptive rights to buy more shares under company rules.

Earlier this month, the London court rejected Telenor's request for an injunction after VimpelCom, Altimo and Sawiris promised to ensure that Telenor receives its preemptive shares if the arbitration court rules in Telenor's favor.

Thursday's shareholder meeting, which will be closed to the press and public, is taking place at VimpelCom's Amsterdam headquarters, with a result expected by early afternoon in Europe.

Vimpelcom eyes victory in disputed $6 billion Wind dealhttp://www.reuters.com/article/2011/03/17/us-vimpelcom-wind-idUSTRE72G1QP20110317

4:56am EDT

MOSCOW (Reuters) - Vimpelcom (VIP.N: Quote, Profile, Research, Stock Buzz) is poised to claim victory in a long-running battle for Italy's Wind Telecom as shareholders vote to approve a deal that would see the Russian mobile phone group take on nearly $20 billion of debt and diversify into new markets.

The $6 billion plus cash-and-shares bid for control of emerging markets specialist Orascom Telecom (ORTE.CA: Quote, Profile, Research, Stock Buzz) and Wind is backed by Russia's Alfa Group but faces opposition from Norwegian rival Telenor (TEL.OL: Quote, Profile, Research, Stock Buzz).

Altimo, the telecoms arm of Russian billionaire Mikhail Fridman's Alfa Group, has 44.7 percent of voting rights in Vimpelcom, currently Russia's third-largest wireless carrier by subscribers.

Telenor, with 36 percent of Vimpelcom's voting stock, faces an uphill battle to convince more than two thirds of independent Vimpelcom owners to reject the deal.

Independent shareholders were told to send their votes before last Friday, but results will only be announced after Thursday's meeting which will start in Amsterdam at 0900 GMT.

Russian business daily Vedomosti said on Thursday that Vimpelcom had received enough votes from minorities to win the vote, citing unnamed sources close to the deal.

"We believe that the shareholder meeting will give the green light to the deal," said VTB analyst Viktor Klimovich.

"Firstly, not that many minorities' votes are needed to approve the deal; and secondly, there are many investors who have taken a passive stance. I would estimate the likelihood of the deal being approved at over 70 percent," he added.

Telenor, concerned about dilution of its voting power in Vimpelcom, last week pledged to work constructively with its estranged partners in Vimpelcom even if it fails to block the deal. But it said it would pursue a separate arbitration case to secure its rights to maintain its full Vimpelcom stake.

This case will focus on whether Telenor can take part in Vimpelcom's share issue to Wind's owner Naguib Sawiris, which is required to complete the transaction.

Analysts said this would change the structure of the deal in a way that would not benefit Alfa and the Egyptian tycoon.

(Reporting by Maria Kiselyova; editing by John Bowker and Jane Merriman)

Russian and Finnish Mobile Operators Discuss Roaming http://www.themoscowtimes.com/business/article/russian-and-finnish-mobile-operators-discuss-roaming/432692.html

17 March 2011Interfax

HELSINKI &mdash Major Russian and Finnish cellular communications operators have begun the process of negotiating the reduction of international roaming tariffs.

Taking part in the talks on the Finnish side are leading companies Elisa, TeliaSonera and DNA, while Russia is represented by its largest mobile operators — MegaFon, Mobile TeleSystems, and VimpelCom. Also joining in are Finnish Communications Minister Suvi Linden and his Russian counterpart, Communications and Press Minister Igor Shchyogolev.

The urgency of these negotiations is underscored by data on the number of visas being issued to citizens of the two countries, Shchyogolev said. "Around a million Russians received Finnish visas in 2010," he said.

"If one considers that many residents of St. Petersburg and the Leningrad region hold multientry visas, it becomes clear that the number is very high, and according to the Russian Embassy in Finland, around 300,000 Finns received visas to Russia," the Russian minister said.

"The goal of our discussions is working out a model that could be used not just with Finland, but also with other countries," Shchyogolev said.

Representatives from the Russian companies have said Finland figures strategically in the country's roaming plans, and there is more need for roaming services every year.

At the end of last month, Russia and the European Union launched expert-level talks on the possibility of Russia being included in the unified EU directive on roaming.

Europe’s Stock Pickers of Decade Split on Cost of ‘Russia Risk’http://www.bloomberg.com/news/2011-03-17/europe-s-stock-pickers-of-decade-split-on-cost-of-russia-risk-.html

By Kevin Crowley - Mar 17, 2011 1:01 AM GMT+0100

Europe’s two best-performing equity fund managers over the last decade both invest in Russia from offices three blocks apart in Stockholm. They are miles away from each other on just how risky a place it remains.

Peter Elam Hakansson of East Capital Group says the country is no more risky than other emerging economies and its stocks will beat those in rival markets by 25 percent in the next three years to reflect this. Fredrik Colliander of Carnegie Fonder AB says corruption and corporate governance concerns justify a discount to nations such as Brazil. The two have each returned more than 700 percent in the past 10 years.

“Today when you buy the Russian stock market, you buy the same valuation as you did in 1999,” said Hakansson, sipping tea on the 14th floor of his office, overlooking snow-covered central Stockholm. “There will be a re-rating as people realize it’s not as risky as it used to be. The amazing thing is people are not perceiving this.”

Surging prices of oil and gas, Russia’s biggest exports, haven’t eased investors’ skepticism so far over the country’s corporate-governance record and legal protection for minority shareholders. Investor disputes involving state-run OAO Rosneft’s partnership with BP Plc and the government’s control of firms such as OAO Gazprom have kept the

price-to-earnings ratio of Russian stocks at least a quarter lower than rival emerging markets Brazil, India and China.

“The present government has its own interests, messing with the economy in so-called strategic sectors,” said Colliander, 47, who has managed Carnegie’s 603 million-euro ($843 million) Russian fund since 2000. “That will continue for as far as we can see. It’s Russia risk.”

10-Year Returns

Hakansson, 48, manager of East Capital’s 1.9 billion-euro Russia fund has turned 10,000 euros invested 10 years ago into 97,700 euros today, making it the best-performing European stock fund with more than 350 million euros of assets, according to Morningstar Inc. A 10,000-euro investment in Colliander’s fund 10 years ago is valued at $70,300, the second-best performer.

The same 10,000-euro investment in the S&P 500 Index (SPX) in 2001 would now be valued at 12,900 euros. Hakansson’s fund is up 25 percent in the past year; Colliander’s has risen 16 percent.

Although the MICEX Index of Russia’s 30 largest publicly traded firms has more than doubled in two years, Hakansson and Colliander agree that cheap valuations relative to other emerging markets give room for growth. They’re both picking Gazprom and OAO Lukoil to benefit from higher oil and gas prices caused by demand from China and political instability in north Africa and are also buying banks including OAO Sberbank, Russia’s biggest bank.

Differing Views

They are split over how Russian stocks should be valued compared with other emerging markets. Hakansson says they will likely trade at the same valuations as Brazil by 2014, implying the country’s stocks will grow 25 percent faster than other emerging markets. Colliander says a 15 percent discount to rival economies’ price to earnings ratio is fair.

“There’s definitely risk when you invest in emerging markets, including Russia, but I don’t see a reason for having a lower P/E than Brazil,” Hakansson said. “It’s a hangover from the Cold War. Maybe we have higher expectations on Russians than we do on others.”

Colliander, who worked in the commercial division of the Swedish embassy in Moscow during the late 1980s, disagrees. “It should be a discount because of its specific issues,” he said.

Gazprom, which is 16 percent of the MICEX Index, has a price-to-earnings ratio of 5.3, almost half European rival Royal Dutch Shell Plc (RDSA)’s ratio of 10.3. Even with oil

prices within 5 percent of a 30-month high, investors have little confidence in the firm’s management, Colliander said.

Gazprom Governance

“Everything happens in Gazprom,” he said.

Gazprom was ranked among eight of the world’s least transparent oil and gas companies in an annual survey published this month by Berlin-based Transparency International and Revenue Watch Institute. All major oil and gas deals in Russia are approved by Russian Prime Minister Vladimir Putin.

Gazprom sold a 9.4 percent stake in OAO Novatek, Russia’s second-largest gas producer, for $1 billion less than its market price last year. “Why in hell would you do that?” Colliander said. “There’s a cap on the whole market until they resolve things like that.”

The stake’s price was calculated using its average value over the six months before the deal, which was agreed in September, according to Gazprom spokesman Sergei Kupriyanov. “The deal was closed in December when the share price was much higher,” he said.

Sweden and Russia

Stockholm has become a center for funds investing in Russia because of its proximity to the country and Sweden’s strong regulatory controls, according to Hakansson. Sweden and Russia were enemies during the Cold War and many Swedes learned to speak Russian, studying the country closely during their mandatory one-year military conscription, he said.

“We have either been intensively trading with the Russians or at war with them,” said Hakansson, a former Swedish marine. “We’ve never been indifferent.”

Colliander and Hakansson’s Russia funds were set up in 1997 and 1998 respectively, almost a decade after the fall of the Berlin Wall, which marked the end of the Soviet Union and thawed relations with Western Europe and the U.S.

Investor Inflows

Hakansson’s fund had $404 million of inflows in 2010, making it the third-biggest accumulator of investors’ capital among European-based Russia funds, according to New York-based research firm Strategic Insight. Colliander had outflows of about $166 million last year after the fund’s former owner, Stockholm-based HQ AB (HQ), was bailed out by the Swedish government and sold its asset-management division to Carnegie Holding AB.

Hakansson was one of East Capital’s three founding members and started in 1998 with 2 million euros under management. His fund now dwarfs his rival’s with 1.9 billion euros under management compared with Colliander’s 603 million euros.

“They used to be a big competitor,” Hakansson said, pointing out Carnegie’s offices from a meeting room overlooking Stockholm. “Not so much now.”

“He has his views, we have ours,” Colliander said. “I can assure you we are doing our best to compete with East Capital.”

Hakansson was attracted to Russia by his conviction that Russians would embrace capitalism and become as economically and politically tied with Europe as it was in the 19th century. “It was a one-off opportunity to invest in a society turning from a communist one to a capitalist one,” he said.

Russia’s Growth

The strategy paid off. After Russia defaulted on Soviet-era debt in 1998 and was bailed out by the International Monetary Fund, its gross domestic product rose almost sevenfold to $1.34 trillion from 1999 to 2010, according to Moscow-based fund manager Prosperity Capital Management Ltd. During that time the average wage climbed to $650 a month from $50 a month and inflation dropped to 8.1 percent from 84 percent.

Russia’s MICEX Index (INDEXCF) beat all major indexes in Europe, Asia and the Americas from 2001 to 2008, rising almost 700 percent as the country bounced back from its bailout, buoyed by rising commodity prices and higher domestic consumption.

In the second half of 2008, the financial crisis wiped three years of gains from the index as it fell 68 percent, before a rally in oil and gas prices helped the index rebound to within 10 percent of its all-time high this January.

Rival Economies

Even with the long-term gains, the MICEX’s price-to- earnings ratio is 9.4, less than the 10.24 it was in 2003, the earliest data compiled by Bloomberg and almost a quarter lower than Brazil’s Bovespa Index. The main exchanges in China and India as well as the U.S. and U.K. have ratios of 13.1 to 16.4, according to data compiled by Bloomberg.

Low valuations are a symptom of an economy dependent on natural resource firms whose stocks move with economic cycles and a legal system with little regard for minority shareholders, according to Joanne Irvine, who helps manage about $40 billion at Aberdeen Asset Management Plc in London.

“The state is involved in a lot of the companies and you have a lot of oligarchs dominating them,” Irvine said. Russia is “one of the weakest places to invest from a corporate governance perspective.”

Aberdeen, which runs the second-best global emerging markets fund over the last year, has an “underweight” position in Russia, preferring India, Irvine said.

The conviction and imprisonment of Mikhail Khodorkovsky, former chief executive officer of Yukos Oil Co., is one case that illustrates the unpredictable nature of the Russian legal system, she said. India is “one of the strongest in terms of corporate governance,” she said.

China Threat

The biggest threat to Russian growth today is from China as opposed to the late 1990s when its economic problems were internal, Hakansson said. The world’s biggest consumer of raw materials reported the largest trade deficit in seven years on March 10 as export growth slowed.

Colliander agreed that a global economic slowdown spurred by China would hit Russia hard. “If we get risk adversity coming in like we did a few years ago, Russia is the first sell,” he said.

Unlike his cross-town rival, Colliander is also wary of Russia’s propensity to surprise.

“We always get reminded of this special Russian issue,” he said. “Something happens every two or three years. It’s difficult to say what’s it going to be next time, but something’s going to happen. It always does.”

To contact the reporter on this story: Kevin Crowley in London at kcrowley1@bloomberg.net

To contact the editor responsible for this story: Edward Evans at eevans3@bloomberg.net;

Activity in the Oil and Gas sector (including regulatory)

RPT-UPDATE 1-Rosneft eyes Arctic deals with China, India firmshttp://in.reuters.com/article/2011/03/17/rosneft-idINSGE72G00M20110317

8:13am IST

(Repeats story issued late on Wednesday)

* Rosneft head says CNPC, CNOOC and Sinopec among contenders

* Indian firms that could join Arctic projects not named (Adds quote, BP background)

MOSCOW, March 16 (Reuters) - Rosneft (ROSN.MM: Quote, Profile, Research), Russia's largest oil firm, is mulling partnerships to explore Russia's Arctic offshore with Chinese and Indian oil companies, CEO Eduard Khudainatov said on Wednesday.

"We are eyeing partnerships with Chinese, Indian companies and others. I should tell you that the whole world is interested in the Arctic, this is a fact," Khudainatov told reporters.

Khudainatov confirmed that CNPC [CNPET.UL], CNOOC (0883.HK: Quote, Profile, Research) and Sinopec (0386.HK: Quote, Profile, Research) were among the contenders but did not name any Indian firms. Rosneft partners with ONGC (ONGC.BO: Quote, Profile, Research) offshore the Far Eastern island of Sakhalin.

State-controlled Rosneft has this year struck offshore alliances with Britain's BP (BP.L: Quote, Profile, Research) in the Arctic, and US Exxon Mobil (XOM.N: Quote, Profile, Research) in the Black Sea. Khudainatov said he expected a joint venture with Exxon to be set up by Oct. 1.

The Rosneft-BP deal has faced opposition from the local tycoons who own half of BP's Russian venture, TNK-BP TNBPI.MM. They argue that it violates the terms of their shareholder agreement and have won a court injunction to put the deal on hold pending the outcome of arbitration proceedings. (Reporting by Alexei Anishchuk; Writing by Douglas Busvine; Editing by Alfred Kueppers and Erica Billingham)

17.03.2011

Lukoil Likely to Join Bashneft in Nenetshttp://www.oilandgaseurasia.com/news/p/0/news/10793

Development deal for the giant oil fields Trebs and Titov could be signed soon between Bashneft and Lukoil.

Mid-sized Russian oil company Bashneft got the licence to explore Trebs and Titov oil deposits in Nenets Autonomous Okrug in November last year. Since then, the company has been in negotiations with Lukoil on possible joint exploration of the fields.

Lukoil, Russia’s largest private oil company is already actively involved in several projects on the tundra in Nenets.

Head of the Bashneft board of directors, Aleksandr Goncharuk, says to Kommersant that

the talks with Lukoil are close to completion.

"A final decision on partnership will be made later this week", Goncharuk tells Kommersant.

The Trebs and Titov deposits are located onshore northeast of Narjan-Mar. The two fields are said to have total oil reserves of 140 million tons and by that are the largest untapped fields in the European part of Russia.

Copyright 2011, Barents Observer. All rights reserved.

03/17 12:36   Tatneft maintains Jan-Feb oil-extraction level at 4.2 mln toneshttp://www.interfax.com/

Gazprom

07:25Gazprom continues talks with CNPC over natural gas deliveries (repeat)http://www.interfax.com/news.asp

Gazprom may speed up Sakhalin-3 project http://www.bne.eu/dispatch_text14484

Renaissance CapitalMarch 17, 2011

Event: Following the tragic events in Japan, which could potentially lead to a material spike in regional hydrocarbon demand to replace lost nuclear energy production, Prime Minister Vladimir Putin held a meeting on 15 March, at which he urged Gazprom in particular to speed up the launch of the Sakhalin-3 project. Today (17 March) Kommersant quoted Minister of Energy Sergey Shmatko as saying that Putin's request would be fully met.

Action: We think the news is marginally positive for Gazprom.

Rationale: Since Rosneft signed an Arctic JV with BP earlier this year, there has been a greater focus among Russian oil companies on the active exploration and development of offshore blocks, often in partnership with foreign energy companies. Gazprom, however, has been less interested in involving foreign partners in the Sakhalin-3 project, preferring to develop the project on its own. Gazprom owns three out of four licences at Sakhalin-3, with total prospective resources of 1.3tcm of gas (6% of 2P reserves) and 700mnt of

crude oil. We are not sure, however, that Gazprom is really in a position to speed up the launch of any of its Sakahalin-3 blocks, and judge the news to be positive for sentiment, rather than for Gazprom's fundamental case. Gazprom's recent plans envisaged launching the Kirinsky block (one of the Sakhalin-3 blocks) in 2012, according to FSU Argus, and approaching foreign firms after 2013-2014, when full exploration is complete.

Ildar Davletshin