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. Last Updated: 07/27/2016


Rosneft Auction

Russia named its terms for the long-awaited privatization of Rosneft, the last big state-owned oil company, putting a stake of 75 percent plus one share up for sale and setting a minimum price of $2.104 billion. Besides the sale price, the winner is required to invest an additional $400 million into the company within 3.5 months. Investment bank Dresdner Kleinwort Benson had earlier in the week valued Rosneft at $2.3 billion.

The president of the oil company Sidanko announced that he and other top managers have resigned after successfully turning around the company's operations in the past two years.

Meanwhile, Russian oil companies started to come to grips with a continuing drop in world crude oil prices. Surgutneftegaz president Vladimir Bogdanov announced that the oil holding company will not cut production this year, but will scale back investment plans and focus on lowering costs. Oil giant Yuksi announced that it will cut production by 5 percent and trim refining activity.

GDP Unchanged

The government announced that gross domestic product was unchanged in February from the same month last year, but the figure for the first two months of the year was up 0.7 percent.

A senior official said the Central Bank intends to withdraw licenses from 500 small, undercapitalized commercial banks in 1998. The Central Bank requires all commercial banks to have capital of at least 5 million ecus ($4.6 million) by July 1, 1998.

Despite an earlier decision to remove State Customs Committee accounts from commercial banks, Russia's government spokesman Igor Shabdurasulov announced that the Cabinet had decided to transfer accounts of the central excise customs service to Uneximbank.

The European Bank for Reconstruction and Development launched a 300 million ruble bond. The issue of the bond, which will be repaid in dollars, is seen as a move that will give investors exposure to the ruble while offering a measure of protection from Russian credit risk.

Russia kicked off a roadshow for its latest issue of Deutsche mark-denominated Eurobonds in the Swiss cities of Zurich and Geneva, only to have the future of the bond thrown into uncertainty Monday by President Boris Yeltsin's sacking of his entire government.

Belarus Currency Woes

Belarussian President Alexander Lukashenko threatened to fire his entire Cabinet and put some officials in jail if they failed to resolve the country's currency crisis. Earlier in the week state and private companies were forced to cut their prices on government orders in a draconian move aimed at propping up the Belarussian ruble.

Kazakhstan's customs service, frustrated by a flow of contraband and mixed signals from other members of the Commonwealth of Independent States, announced it was stepping up controls on borders with Russia and several other former Soviet states.

Battle Against Bar Codes

A Moscow city court ruled the city was allowed to require bar codes as proof of quality on the labels of all locally sold wine and spirits. The State Anti-Monopoly Committee had previously banned the bar codes as a breach of federal free trade laws. The committee plans to appeal.

Uranium Collateral

Deputy Nuclear Power Minister Viktor Mikhailov said Russia would press ahead with a plan to use uranium stockpiled in the United States under a $12 billion disarmament deal as collateral for a multimillion-dollar loan from major Western banks. The loan, which still requires approval from the Finance Ministry, would allow the cash-starved Nuclear Power Ministry to tap the value of nearly $100 million worth of uranium stored in the United States.

Tobacco Investment

Three Western tobacco giants -- Philip Morris, R.J. Reynolds and British-American Tobacco -- separately announced plans to expand their Russian operations in moves that will add nearly half a billion dollars to the country's economy.

One of Russia's largest banks, Inkombank, purchased a 25-percent blocking share in the medium-sized insurance company RESO-Garantiya.