Install

Get the latest updates as we post them — right on your browser

. Last Updated: 07/27/2016

Business in Brief

Trans-Korean Link



SEOUL, South Korea (Reuters) -- South Korea said Friday that one railroad line would be reconnected through the world's most fortified frontier to North Korea by the end of this year and a second by early next year.

The South Korean version of a joint statement after three days of economic talks in Seoul said work would begin Sept. 18 to rejoin railroads and roads severed since the end of the 1950-53 Korean War.

The two railroads -- one on each side of the peninsula -- could one day be linked to the Trans-Siberian route through Russia to Europe and to China. South Korea has already rebuilt one line right up to the Demilitarized Zone near the west coast but the North has done next to no work so far.




EU Market Status



MOSCOW (Interfax) -- The European Union will consider granting Russia market economy status no earlier than Oct. 25, Interfax reported Friday, quoting a source in the European Commission.




Money Supply Up 13%



MOSCOW (Prime-Tass) -- The nation's money supply, including hard-currency deposits, increased 13.2 percent in January-July to 2.404 trillion rubles ($76 billion) by Aug. 1, the Central Bank said Friday.

The amount of cash in circulation outside the banking system rose 12.9 percent to 659.725 billion rubles.




Tatneft Team to Iraq



MOSCOW (MT) -- Oil major Tatneft has sent a team to Iraq to undertake drilling work authorized by the United Nations, the International Oil Daily reported Friday, AFP reported.

The six-member team is expected to start drilling wells in the Kirkuk, Saddam and Bai Hassan oil fields in northern Iraq under a $7 million contract approved by the UN sanctions committee.

Tatneft, a producer from the Muslim-populated republic of Tatarstan, has also sent drilling equipment to Iraq and plans to dispatch a 20-member team in late September, AFP reported.




Ruble Intervention



MOSCOW (Reuters) -- Increased liquidity put pressure on the ruble Friday, but the Central Bank steadied it with a big injection of dollars from its reserves, dealers said.

In the unified trading session of eight exchanges, which usually serves as the basis for the Central Bank's next-day ruble/dollar rate, the ruble edged up to a weighted average for today settlement of 31.5673 from 31.5744 on Thursday.

Dealers said the Central Bank started selling dollars when the ruble touched the 31.60 level and speculated it spent about $300 million from its currency reserves on the interbank market.




Foreign Debt Payments



MOSCOW (Prime-Tass) -- The government plans to pay $4.5 billion to foreign governments and $2.9 billion to international finance organizations next year, the Finance Ministry said.

Specifically, Russia is expected to pay $1.9 billion to the International Monetary Fund and a combined $800 million to the World Bank and the European Bank for Reconstruction and Development.

The government also plans to pay $3 billion, or 4 percent, of principal debt on inherited Soviet debt to the Paris Club of creditors next year.




Regional Surplus



MOSCOW (Prime-Tass) -- Russia's consolidated regional budget surplus in January-July amounted to 28.65 billion rubles ($906 million), or 0.5 percent of gross domestic product, the Finance Ministry said Friday in a report on regional budgets.

Russia's consolidated regional budget surplus over the same period last year was 39.75 billion rubles, or 0.83 percent of GDP.

Consolidated regional budget revenues in January-July stood at 1.026 trillion rubles, up from 694.53 billion rubles over the same period last year. Spending rose to 997.62 billion rubles from 654.78 billion rubles over the same period last year.




UES Buys More Gas



MOSCOW (Prime-Tass) -- Power monopoly Unified Energy Systems plans to spend 95 billion rubles ($3 billion) on gas supplies for its power stations in 2002, compared to 77.8 billion rubles last year, the company said in a statement Friday.

UES's power stations consume on average 135 billion to 140 billion cubic meters of gas per year, the company said.

Gazprom will supply 26.5 billion cubic meters to UES in the third quarter of this year and 42.9 billion cubic meters of gas in the fourth quarter, the company said earlier. Supplies from nonstate-owned gas producers, such as Itera, Surgutneftegaz, LUKoil and Yukos, account for 15 percent to 20 percent of UES's total natural gas purchases.




Ukraine Demand



KIEV (MT) -- Ukrainian Prime Minister Anatoly Kinakh reiterated Friday his government's demand that it have a 50 percent plus one share stake in a planned consortium to manage the gas pipeline network from Russia to Europe.

"We believe this is a justified and objective attitude on the part of Ukraine, considering the importance of the gas transit network for us," Interfax quoted Kinakh as saying.




RTS Sheds 0.5%



MOSCOW (Reuters) --- Shares finished mixed on Friday in slow trade as oil majors continued to fall in the wake of a retreat in world oil prices earlier last week, traders said.

Investors were also unwilling to increase their positions ahead of the Labor Day weekend in the United States and amid uncertainty over whether European equity gains were sustainable, traders said.

The bourse's benchmark RTS index shed 0.46 percent by the close at 332.9, adding to Thursday's 4 percent loss, after being hit by a weak opening on Wall Street. Turnover was a low $8.9 million.




Ford Rolls Out Focus



MOSCOW (MT) -- The Ford Motor Co. delivered its first Russian-assembled Ford Focus models to official dealers Friday, the Rosbalt news agency reported.

The company, which is assembling the cars at its plant near St. Petersburg, was quoted as saying sales will not begin until later this year, but dealers have set aside special areas in their showrooms to showcase the car.

Ford has invested $150 million in the construction of its factory in the Leningrad region town of Vsevolozhsk, which is projected to produce 25,000 cars per year.




Severstal Loses $467M



MOSCOW (MT) -- Severstal, one of the country's big three steel makers, said Friday that it posted a net loss of $466.9 million last year under U.S. generally accepted accounting principles, Interfax reported. The company had a net profit of $452.7 million in 2000 under U.S. GAAP.

Analysts attributed the loss to non-cash issues: a revaluation of fixed assets and other nonoperating costs, including the Severstal group's restructuring costs.

Severstal's revenues dropped almost 14 percent to $1.789 billion in 2001 from $2.073 billion in 2000.

Troika Dialog, which recently upgraded its recommendation on Severstal to hold from sell, had forecast a net profit of $148 million.

Other leading investment banks have left their recommendations at sell or hold.