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. Last Updated: 07/27/2016

Business in Brief

$34Bln Owed

MOSCOW (MT) — Tax Minister Gennady Bukayev on Tuesday said Russian enterprises owe 1 trillion rubles ($34 billion) in back taxes, Prime-Tass reported.

Bukayev told Rossiiskaya Gazeta newspaper the ministry would reschedule the debts of some enterprises, but would "not hesitate to remove bad debtors from the market."

"Today the government proposes to live according to the rules and provide these [tax delinquents] with one last opportunity to repay their debts," Bukayev said. "We will do everything to eliminate a bad debtor from the market forever," he was quoted as saying.

Less Bread

MOSCOW (Vedomosti) — Russia’s bread production in the first half of the year was 5 percent less than in the same period last year, according to the State Statistics Committee.

Meat and dairy production, however, was up 7.3 percent than in that same period.

"Now the well-being of the population is increasing. People really are eating more meat — this year production will rise by 10 percent compared to last year," said Musheg Mamikonyan head of the Russian Meat Union on Monday.

The drop in bread production was the first since the 1998 crisis.

Sberbank Market Share

MOSCOW (Vedomosti) — Sberbank’s share of personal savings deposits fell 0.4 percent to 74.7 percent of the national total between January and May, according to the latest data from the State Statistics Committee.

Sberbank deputy director Gennady Melikyan called the drop a "natural process" and said a leveling of the deposits market after the financial crisis was unavoidable.

He said that Sberbank is aiming for a 60 percent to 70 percent share of this market.

Electricity Exports

MOSCOW (MT) — Unified Energy Systems plans to export 18.523 billion kilowatt-hours of electricity this year, Interfax reported Tuesday.

Under existing contracts, UES will export a total of 8.793 billion kWh of electricity to countries outside the Commonwealth of Independent States in 2001, including 6.657 billion to Finland, 850 million to Latvia, 820 million to Poland, 255 million to Turkey, 175 million to China, 36 million to Mongolia and 0.10 million to Norway.

Last year, UES exported 5.3 billion kWh of electricity to Finland, 0.6 billion to both Poland and Turkey, 0.4 billion to Mongolia and 0.15 billion to Norway.

A Chubais Promise

MOSCOW (Reuters) — Power sector boss Anatoly Chubais promised Tuesday that a shake up of Unified Energy Systems would take minority shareholders’ interests into account.

He also hailed the plan as a way to attract billions of dollars of investment and carry out a shift from "socialism to capitalism" within Russia’s energy sector.

"It would not be objective to state that today all minority shareholders implicitly support the decisions which have been approved," Chubais said in a statement."We will aspire to make each step of our management transparent and clear to our shareholders," he said.

Improvements in corporate governance were under way, he added, including a new code that is in line with Western practice.

MGTS H1 Profits Fall

MOSCOW (Reuters) — Telecoms firm MGTS said Tuesday that net profits plunged to 17.28 million rubles ($589,000) in the first half of 2001 from 371.63 million rubles in the same period a year ago.

"Lower profits are due to the repayment of a Eurobond in the first half of this year, which required a lot of the company’s resources," said an MGTS official. MGTS repaid a $150 million Eurobond this March.

Rostelecom Plans

MOSCOW (Vedomosti) — Rostelecom will not become a domestic operator but will remain focused on the long-distance market, the telecom operator said in an interview published Tuesday.

"Rostelecom will continue to orient itself most of all to the long-distance market," said company general director Sergei Kuznetsov.

The company also said it was keen on taking part in Telia’s Viking telecoms cable project and had agreed to participate in a Finnish-Russian section.