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

. Last Updated: 07/27/2016

Business in Brief

PM Sees 6% Growth

MOSCOW (Bloomberg) -- The economy will grow more than 6 percent this year, as average oil prices were $5 per barrel more than the highest government forecast and consumer spending drove demand for mobile phones, real estate and clothing.

"Economic growth in Russia for the full year could exceed 6 percent," the government cited Prime Minister Mikhail Kasyanov as saying in the Siberian city of Nizhnevartovsk.

The economy has grown by more than 4 percent per year since 1999, the longest expansion since the fall of the Soviet Union, as oil and gas companies such as Gazprom and Yukos have boosted output while 46 consecutive months of consumer spending drives cellphone use at operators such as Mobile TeleSystems.

Norilsk Profits Rising

MOSCOW (Reuters) -- Norilsk Nickel said Thursday that its net profit this year may soar, but warned the forecast was based on Russian accounting standards which could be misleading.

"Consolidated net profit in 2003 is expected to be 32.1 billion rubles ($1.08 billion), an increase of 25.7 billion rubles," a Norilsk statement said.

But a company official warned against estimating the company's performance on the basis of this forecast made to Russian accounting standards.

"The figures provided in accordance with Russian accounting standards are far from realistic, and the difference between these and international accounting standards can be explained for days," Sergei Polikarpov, head of investor relations said.

Norilsk said Thursday that its board had approved a dividend of 42.1 rubles ($1.41) per share for the first nine months of 2003, reflecting high metals prices in this period.

The world's top producer of nickel and platinum group metal palladium paid a 2002 dividend of 21.7 rubles per share.

Island Sputnik Study

JAKARTA, Indonesia (AP) -- Russia is hoping to launch a satellite from Indonesia's easternmost Papua province sometime next year, the state news agency Antara reported Friday.

Russian government officials have already conducted a field study on Biak island off the northern coast of the remote province, it quoted Papua Governor Jaap Solossa as saying.

Solossa said Russia wanted to launch the satellite on the island because of its "strategic location," but gave no more details, Antara reported.

Russian Embassy officials were not immediately available for comment.

Gazprom Eyes Bonds

ST. PETERSBURG (Reuters) -- Gas giant Gazprom plans to raise as much as 88 percent of its total $5 billion corporate borrowing program for 2004 from European, U.S. and Asian markets, a top executive said on Friday.

Gazprom chief financial officer Boris Yurlov said that the company would mainly focus on international bond issues, with the first issue expected as early as the first quarter of 2004.

Yurlov also said Gazprom's debt- cutting program would slow down in 2004, as the company needed money to boost investments in new projects. The firm would cut debt by only $400 million to $500 million in 2004, compared with a cut of $2 billion in 2003.

He also said the world's largest gas firm may report its financial results for the first half of 2003 next week.

"We have extremely positive results under international standards," he said.

Bank Plans Bond Sale

LONDON (Reuters) -- Vneshtorgbank plans to sell a dollar-denominated international bond this month, an official at a lead managing bank said Friday, the first such issue since a probe into oil giant Yukos rattled investors' nerves.

The bond will be the first offering from the bank under its $2 billion medium-term note program, arranged by Deutsche Bank and UBS.

"The first tranche will be a strategic transaction with a maximum size of $500 million," said an official at one of the leads. "It is more important for the client to place the right sort of transaction. The client is more price-sensitive and more interested in getting its name into the market."

The maturity of the issue would be up to five years. On Thursday, Moody's Investors Services rated the planned issue Baa3, its lowest investment-grade rating and the same as the country.

Poultry Spat Near End

BOSTON (Reuters) -- Economic Development and Trade Minister German Gref said Thursday that Moscow and Washington are quite close to resolving their current trade spat over import quotas on U.S.-produced poultry.

"I think we are quite close to a resolution," Gref said during a joint news conference with U.S. Commerce Secretary Donald Evans. Gref and Evans spoke privately after appearing before an audience at the U.S.-Russian Investment Symposium sponsored by Harvard University.

"We did not have any resolution of those issues today, but they continue to be on our minds and we will continue to work toward any mutually acceptable resolution on both of those issues," Evans said.

Evans said the two countries remain actively engaged in not only poultry talks, but steel talks as well.

Gref said in the upcoming week Russia would take a decision on the introduction of long-term quotas for poultry.

Gas Deal Signed

MOSCOW (Bloomberg) -- TNK-BP agreed with China National Petroleum Corporation and Korea Gas to sell 600 billion cubic meters of natural gas from a Siberian field to China and 300 bcm to Korea over 30 years.

TNK-BP, CNPC and Korea Gas signed an agreement in Moscow to start the deliveries in 2008, bringing sales to China to 20 bcm of gas a year and shipments to Korea to 10 bcm a year by 2017.

Rusia Petroleum, which Moscow-based TNK-BP controls, is developing the Kovykta field near Irkutsk, which holds an estimated 1.8 trillion cubic meters of gas. The partners plan a 4,000-kilometer pipeline from Kovykta, estimated to cost $17 billion.

Rusia plans to sell 4 bcm of gas per year in Russia.

EU Wants Power Link

MOSCOW (Bloomberg) -- Europe's grid operators next year may begin studying technical hurdles to extending power connections to Russia, helping investors decide whether to pursue a project that would boost the European Union's supplies.

The Union for the Co-ordination of Transmission of Electricity, the grid association, is waiting for outside funds to cover 90 percent of the study's costs, estimated at as much as 4 million euros ($4.7 million). The European Commission said last month it is willing to help finance the three-year review, UCTE president Martin Fuchs said at a conference in Brussels.

"It makes absolutely no sense" to limit the European power market to the EU, Christopher Jones, the commission's head of electricity and gas, said at the conference yesterday. Power links that now stretch from Portugal to Romania may be extended to Baltic countries and former Soviet republics.

PC Sales Jump 23%

MOSCOW (Prime-Tass) – Supplies of personal computers on the Russian market increased 23 percent on the year to $467 million in July-September, according to a report released Friday by the global research firm International Data Corporation. In real terms, the supplies increased by 684,000 units from the same period last year, IDC said, adding that the increase from the second quarter exceeded 22 percent.

According to the report, the top five suppliers in the third quarter included Russia's Aquarius, Hewlett-Packard, headquartered in the U.S., Russia's K-Systems, Kraftway, and Formoza.

Supplies of laptop computers more than doubled in the third quarter reaching 59,000 units, an all-time high since IDC began conducting research in Russia.

$100M for Shipppers

ST. PETERSBURG (Prime-Tass) -- The International Finance Corporation, part of the World Bank Group, will open a $100 million credit line to the Volzhskoye and Severo-Zapadnoye shipping companies, Viktor Olersky, chairman of Severo-Zapadnoye, said Friday.

The credit line is to be used to finance building new ships, he said.

The talks on providing the credit line have finished and Olersky said he hopes that the IFC's board of directors will approve the credit line in a short time.

The total amount of financing needed for the program is $143 million and the IFC is able to provide about 70 percent of the amount, according to its internal policies, Olersky said.

The companies expect to build about 20 Valdai-type dry-cargo freight ships which can sail both seas and rivers, he said.

For the Record

The chairman of French oil major Total said on Friday that the company did not have a stake in its embattled rival major Yukos. (Reuters)

The TV advertising market is expected to exceed $1 billion in 2003 for the first time in its history, Alexander Dybal, the CEO of Gazprom-Media, said Friday. (Prime-Tass)