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. Last Updated: 07/27/2016

Business in Brief

$2 Trillion Needed

MOSCOW (Prime-Tass) -- Russia will require about $2 trillion in investments over the next 20 years to insure stable economic growth, according to a report to be presented by the Russian delegation at the Earth Summit that opened in Johannesburg, South Africa on Monday.

The report was prepared by the Economic Development and Trade Ministry, the Foreign Ministry and the Natural Resources Ministry in cooperation with a group of independent experts.

According to the report, capital investment in the economy plunged 80 percent after the 1998 crisis.

The report says budget funds will primarily be invested in the social, transport, telecommunications and financial sectors, as well as in environment protection and the defense industry.

$10.5Bln Energo

MOSCOW (Vedomosti) -- Irkutskenergo has insured its power grid and generators for a total of $10.5 billion.

The policy, written by leading property insurer Ingosstrakh, is the second biggest in Russia, behind Russian Aluminum's $12.5 billion policy.

It had previously been reported that Irkutskenergo had insured its main assets for 10.5 billion rubles. However, an Ingosstrakh representative confirmed that the amount was actually in dollars.

Irkutskenergo financial director Boris Isayenko said shareholders had adopted a broad insurance program after the Sept. 11 terror attacks in New York and Washington.

Finance Ministers

MOSCOW (MT) -- Prime Minister Mikhail Kasyanov on Tuesday appointed two new first deputy finance ministers, Sergey Vyazalov and Tatiana Golikova.

Interfax reported Vyazalov will be responsible for interbudget relations and sector financing, as well as coordinating disaster relief for flood-hit regions in the south.

Golikova, who was already a deputy finance minister, will be responsible for budget policy, the social sphere and science.

State Loan for UES

MOSCOW (Prime-Tass) -- Power grid monopoly Unified Energy Systems expects to receive a government loan of 5 billion rubles ($159 million) to stockpile fuel for peak power consumption in the fall and winter, UES chief Anatoly Chubais said Tuesday.

The loan is planned to be repaid by the end of the year, he added.

Energy Minister Igor Yusufov said Tuesday that UES needs a total of 6 billion rubles for the peak season.

Auchan Opens

MOSCOW (Reuters) -- Leading French retailer Auchan opened Russia's largest supermarket Tuesday and announced plans to open two more stores in the coming months, part of bold expansion plans it hopes will help it battle local competition.

The 16,000-square-meter store in Moscow's northern outskirts will boast some of the lowest food prices in greater Moscow, Auchan's general director for Russia, Patrick Longuet, told a news conference.

He declined to say how much the company had invested or planned to invest in Russia

Longuet said Auchan planned to open its second store in the south of the city in December and its third just west of the city, in the first quarter of 2003.

The first store will employ 790 people. Auchan plans to create 1,300 jobs by the year-end, the company said.

Vimpelcom Profit

MOSCOW (Reuters) -- No. 2 cellular operator Vimpelcom said Tuesday its second-quarter profit fell from the previous quarter to $21.94 million, at the low end of expectations, as it built up its networks and won over 600,000 new users.

However, the company beat last year's second-quarter profit of $9.41 million, which had been its second quarter in profit after a few years of losses.

Core earnings and revenues per user beat consensus forecasts, and Vimpelcom blamed the quarterly profit decline on two charges, $2.3 million in stock options and a $9.5 million forex loss.

First-quarter profits were $28.05 million and net revenues $145.06 million.

WBD Buys Roska

MOSCOW (Prime-Tass) -- Leading juice and dairy producer Wimm-Bill-Dann has bought St. Petersburg milk company Roska for $11.7 million, WBD vice president Yevgeny Chvertkin said Tuesday.

Chvertkin said purchase was the 19th acquisition for WBD.

The Roska factory currently produces dairy products under the Roska and Kolibri brand names including milk, sour cream and kefir.

Chvertkin said WBD plans to modernize the factory and triple production capacity.

Baltika Profits Surge

MOSCOW (MT) -- Brewing giant Baltika showed better-than-expected results in its GAAP results for the first six months of 2002, posting net income of $72.8 million, compared to $57.5 million the year before.

Net sales were up 53 percent year on year at $356.4 million while production increased 32 percent.

Baltika said in a statement that it had extended its market share from 21.1 percent to 23.4 percent.

"The only surprises in the results are pleasant ones," said Natasha Zagvozdina, consumer goods analyst with Renaissance Capital.

For the Record

Russia plans to sell precious metals and gems from the state reserve worth up to 32 billion rubles ($1 billion) in 2003, according to the draft 2003 budget, a copy of which was obtained by Reuters on Tuesday. (Reuters)

Standard & Poor's has raised its long-term credit rating for Renaissance Capital Holdings Ltd. to CCC+ from CCC. (MT)

The State Duma plans to consider the 2003 draft budget in its first reading Sept. 26, Deputy Duma Speaker Vladimir Lukin said Tuesday. (Prime-Tass)