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

. Last Updated: 07/27/2016

Business in Brief

GDP May Grow 6.4% in '05

The economy will probably grow as much as 6.4 percent this year, faster than 6 percent predicted earlier, Interfax reported, citing Economic Development and Trade Minister German Gref.

The economy grew an annual 7 percent in the third quarter, the fastest pace for a year, led by retail sales and construction.

Russia's $521 billion economy is expanding for the seventh consecutive year, backed by higher prices for oil, the country's major export commodity. The price for Urals crude rose 46 percent from the beginning of the year, closing at $53.47 per barrel on Dec. 16. (Bloomberg)

'06 Budget Revised

The government expects the budget surplus next year will be more than 40 percent higher than initially planned because oil prices will be higher, Interfax reported, citing Finance Minister Alexei Kudrin.

The government plans to increase the 2006 revenue target by 329 billion rubles ($11.5 billion), to 5.4 trillion rubles, Interfax said, citing Kudrin. It did not report the government's oil price forecast for 2006.

The budget surplus is expected to be 1.1 trillion rubles in 2006, from the 780 million rubles initially planned, Interfax reported. (Bloomberg)

'06 Utilities Tariffs

The government should limit increases in housing-service charges and utilities prices next year to help curb inflation, President Vladimir Putin said at a meeting with the Cabinet in the Kremlin on Monday.

The State Duma approved a law Monday that allows the government to curtail the increases, which rose by one third this year, said Deputy Prime Minister Alexander Zhukov at the meeting, which was broadcast on Rossia state television.

The law is yet to be approved by the Federation Council and signed by the president. (Bloomberg)

Turkey to Buy Russian Oil

Turkey's Koc Holding may buy Russian crude next year to supply the Tupras Turkiye Petrol Rafinerileri refinery, Interfax said, citing Koc board member Rahmi Koc.

Koc did not say how much Russian oil the company may buy, saying only that Tupras had a capacity to refine 26 million tons of crude per year, the news service said. (Bloomberg)

Oil Taxes in Vietnam

Vietnam's government has increased the corporate income tax rate on the country's biggest oil producer, a joint venture with Russia's Zarubezhneft, to 50 percent from 40 percent, the Vietnam Investment Review reported, citing a government official.

The increase was made to bring the tax rate on Vietsovpetro, which is owned by Vietnam Oil & Gas and Zarubezhneft, in line with other foreign investors in Vietnam's oil and gas industry, Deputy Finance Minister Truong Chi Trung told the newspaper.

The government also eliminated a profit remittance tax, the report said. (Bloomberg)

Novorossiisk Port Closure

Russia's largest oil port, Novorossiisk, was closed to shipping for a third day Monday because of strong winds and rough seas, local ship agents said.

As many as 12 tankers were waiting on the Black Sea to dock and load oil.

Shipping operations at Novorossiisk are frequently disrupted during the colder months. (Bloomberg)

Vacuum Tubes Ruling

The Saratov regional branch of the Federal Anti-Monopoly Service has ruled in favor of the ExpoPUL vacuum tubes factory after its energy supplier Refenergo threatened to switch off its utilities as of Jan. 1 due to technical limitations and unspecified "disputes."

Saratov anti-monopoly officials ruled Friday that Refenergo had violated anti-monopoly laws and was obliged to renew its contract with ExpoPUL after the current contract expired on Dec. 31, an agency spokeswoman said Monday. Refenergo will have three months to appeal the decision, she said.

ExpoPUL, owned by U.S. businessman Mike Matthews, supplies vacuum tubes to leading manufacturers of musical amplifiers such as Peavey, Korg and Fender. Matthews has claimed that ExpoPUL is being bullied out of its property by Refenergo's parent company, Russian Business Estate. (MT)

Alrosa Sales to De Beers

The European Commission will ask diamond monopoly Alrosa to stop gem sales to De Beers by 2009 for breaching competition laws, Kommersant reported, citing a person with knowledge of the talks. The newspaper did not say what the alleged breaches were.

The European Commission on Nov. 21 denied a report in South African newspaper Business Day saying it wanted Alrosa's sales to De Beers to stop next year.

State-owned Alrosa agreed to reduce diamond sales to De Beers to an annual $275 million by 2010, from $800 million now, after the European Commission began investigating a possible breach of its competition laws. (Bloomberg)

Telco Gets $32M Tax Bill

Southern Telecommunications, a unit of national fixed-line telephone holding Svyazinvest, was served with a 917 million ruble ($32 million) bill for unpaid taxes, the company said on its web site Monday.

The Krasnodar-based company, the dominant fixed-line telephone provider in Krasnodar and other southern regions, said most of the bill, for 2002 and 2003, related to transactions between operators for international and long-distance calls.

Southern Telecom is one of seven regional operators controlled by Svyazinvest, the national fixed-line holding company. The government plans to sell its 75 percent stake in Svyazinvest as early as next year. (Bloomberg)

S&P Raises Bank's Rating

Russian Bank for Development, a state-owned lender, had its rating raised to investment grade by Standard & Poor's less than a week after the ratings service raised Russia's rating by one step.

S&P improved the long-term foreign and local currency ratings on the bank, which provides credits to small businesses, to BBB-, the lowest investment grade, from BB+. The outlook is stable, indicating S&P is not inclined to alter its judgment. (Bloomberg)

Kazakhmys Q3 Output

Kazakhmys, the Kazakh copper producer that completed an initial public offering in London in October, said third-quarter output dropped 12 percent after maintenance work at its Zhezkazgan smelting and refining plant.

The company produced 95,200 metric tons of finished copper in the third quarter compared with 108,600 tons in the preceding quarter, Kazakhmys said Monday in an e-mailed statement.

Zhezkazgan will return to full production in the fourth quarter, after the repair work on its furnace. (Bloomberg)

Refinancing Record

Pushkino Logistics Park, a development in the Moscow region, has secured $130 million to refinance its loans -- the largest institutional refinancing transaction on the Russian commercial real estate market, according to Jones Lang LaSalle, which arranged the transaction.

Eurohypo, a European real estate and public finance bank, offered the bank's developers, Capital Partners and Lone Star Ventures, better borrowing terms than Russian and CIS banks, said James Corrigan of Jones Lang LaSalle.

The 210,000-square-meter business park, 16 kilometers northeast of Moscow, is due to be completed in the second quarter of 2006. (MT)

Office Record

One million square meters of top-class office space were sold and leased in Moscow in 2005, marking a new record, analysts at Cushman & Wakefield Stiles & Riabokobylko said.

The real estate consultancy reported growth in the class-A and class-B office space market in 2005 at 30 percent, compared with 25 percent in 2004. The average rent increase was 7.7 percent. Vacancies averaged 4.15 percent, less than half the November vacancy rate in Manhattan, which was 8.9 percent. (MT)