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. Last Updated: 07/27/2016

Business in Brief

Retail Sales Up 12.3%

MOSCOW (Bloomberg) -- Retail sales increased 12.3 percent in July from the same month a year ago, faster than expected, as domestic demand grew, the State Statistics Service said Friday.

Retail sales increased 3.3 percent in July from the previous month, to 456.5 billion rubles ($15.6 billion), the service said in a statement.

Retail sales increased 11.3 percent in the first seven months of the year from the same period a year ago, up from growth of 9.3 percent in the same period of 2003, the service said.

Debt Forecasts

MOSCOW (Prime-Tass) -- The country's foreign debt is expected to amount to $107.4 billion as of Jan. 1, 2006, down from the forecast $113.7 billion on Jan. 1, 2005, according Finance Ministry materials related to the draft 2005 budget.

The outstanding debt on loans from other governments is forecast to total $50.1 billion as of Jan. 1, 2006, against $52.6 billion predicted for Jan. 1, 2005.

According to the ministry's documents, Russia will owe $44.4 billion to the Paris Club of creditors as of Jan. 1, 2006, down by $1.7 billion from the forecast figure for a year earlier.

Debts to international financial organizations are expected at $8.9 billion in early 2006, including $2.2 billion owed to the International Monetary Fund, $5.4 billion to the World Bank, and $1.3 billion to the European Bank for Reconstruction and Development.

Gazprom Exports Grow

MOSCOW (Bloomberg) -- Gazprom said exports grew an annual 11 percent in the first seven months of the year, accelerating from the expansion rate in the first half of 2004.

Exports rose to 90.96 billion cubic meters, up from 81.91 billion cubic meters in the first seven months of 2003, said Gazexport, a Gazprom unit, in a statement.

Gas exports rose 9.6 percent in the first half of the year. Germany was the company's biggest customer, followed by Italy.

MiG Chief Is Upbeat

MOSCOW (Reuters) -- State-owned jet maker MiG has paid off $180 million of debt this year and expects the strength of its exports to wipe out its remaining debts, the head of the firm told Interfax Saturday.

"The financial situation has undergone a substantial change for the better," MiG's general director Valery Toryanin was quoted as saying by the news agency, which said MiG's debts stood at $500 million to $600 million at the start of the year.

MiG has lagged its rival Sukhoi, but said last month it was gaining ground, with current contracts valued at $1.4 billion just shy of Sukhoi's annual sales of $1.5 billion.

Toryanin said MiG's booming order-book meant it would outstrip its export target for 2004 and export sales were likely to rise to up to $600 million to $800 million per year.

"That kind of figure will make it possible to pay off all the company's debts," he said.

Diamond Data Decree

MOSCOW (MT) -- The government plans to amend the state secrets law, a remnant of the Soviet system, to declassify the country's diamond mining, export and import data before the end of October, the Finance Ministry announced Friday.

Director of the Finance Ministry's administrative department Sergei Viazalov said a draft of the necessary presidential decree is already in the works.

"We, as the Russian Federation, promise to ratify this decree and to open the figures before the Kimberly Process meeting," Viazalov said, Interfax reported.

The Kimberly Process was initiated by 36 diamond-producing countries in 1999 to fight the illegal diamond trade, which uses the so-called "blood diamonds" to fund rebel wars in Sierra Leone, Angola and other hot spots around the globe.

The next meeting of the Kimberly Process will take place on Oct. 27 in Ottawa.

Alrosa Mines $1Bln

MOSCOW (Bloomberg) -- Alrosa, which mines one-quarter of the world's rough diamonds, extracted rough diamonds worth $1.05 billion dollars in the first half of the year as the company increased sales.

Rising economic growth has increased demand for diamonds, depleting stockpiles of rough stones. The mining company in May said it planned to raise diamond prices by an average 10 percent to match increases by rivals including De Beers.

Alrosa produced polished diamonds worth $65.4 million in the first six months of the year, it said in a statement. It did not give comparative figures.

The company said work is continuing on its second ore-enrichment plant in Angola, which should enable its Angolan venture, Catoca, to double gem sales in 2005.

Supermarket Profits

MOSCOW (Prime-Tass) -- The net profit of supermarket chain Sedmoi Kontinent amounted to 328.23 million rubles ($11.2 million) in January-June, against a net loss of 5 million rubles in the same period last year, as calculated under Russian accounting standards, according to the company's report released Friday.

The chain's revenues rose 34.5 revenues on the year to 6.59 billion rubles in January-June and gross profit increased 50 percent to 1.76 billion rubles.

The increase in profits was influenced by the decrease in sales costs of the chain's goods as well as a better pricing policy, the report said.

Sedmoi Kontinent has 55 stores. Ramako asset management company holds a 99.11% stake in the company.

UES's Kyrgyz Plans

CHOLPON-ATA, Kyrgyzstan (Reuters) -- State-controlled utility Unified Energy Systems plans to invest $2 billion in hydroelectric power stations in Kyrgyzstan with a view to exporting the energy, the company said Friday.

UES chief executive Anatoly Chubais, following talks with Kyrgyz officials, said he would sign an agreement on Nov. 30 that would allow UES to participate in the completion of two large Soviet-era hydroelectric power stations.

"We are seriously analyzing the situation not just in Kyrgyzstan but also of the possibilities of hydroelectric power with your neighbors. We have developed an Asian hydroelectric strategy," he told a news conference at Cholpon-Ata near the capital Bishkek.

Kyrgyzstan produces around 13 billion kilowatt-hours of hydroelectricity a year -- less than one-tenth of the mountainous nation's potential, according to Kyrgyz government estimates.

Mortgages By Decree

ASHGABAT, Turkmenistan (AP) -- Turkmenistan's president has ordered a commercial bank to start issuing mortgage loans to enable citizens to buy luxury apartments and houses, officials said Friday.

President Saparmurat Niyazov ordered Prezidentbank to give citizens 15-year mortgage loans with an annual 3 percent interest rate to buy housing, the government's press office said.

Only two other banks have so far been providing mortgage loans. The order said the move was aimed "to create conditions so that every Turkmen citizen will be able to buy a comfortable home."

Niyazov, who has built a vast personality cult around himself, has in recent years built numerous expensive hotels, palaces and luxury apartment blocks and cottages in Ashgabat radically changing the look of this once provincial town.

Apartments and new houses are unaffordable for most Turkmens -- the average monthly salary is about $80. A new two-room flat costs about $18,000.