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    MOSCOW, February 10 (RIA Novosti) Russia, Belarus divided on military issues / Russia trying to play on Ukrainian election ground / Gazprom produces 80% of gas from fields commissioned in Soviet time / Acer shifts its Russia trade into rubles


    Russia, Belarus divided on military issues

    The Belarusian Foreign Ministry has rebuked Russian Ambassador to Minsk Alexander Surikov for his statement regarding the involvement of Belarusian military personnel in the collective rapid-reaction force of the Collective Security Treaty Organization (CSTO).
    It turns out that Minsk is unable to promptly dispatch its troop contingent to hot spots.
    Ambassador Surikov said bilateral relations held legal sway over national legislation, that the collective rapid-reaction force could be used to repel a possible aggression against any CSTO member state or to cope with any other crisis, and that Belarusian soldiers could be sent to the Tajik-Afghan border in case of complications.
    Minsk reacted sharply to the Russian ambassador's statement. A spokesman for the Belarusian Foreign Ministry said the military personnel were forbidden under the national constitution from taking part in combat operations in regions outside the country.
    Moreover, all decisions on using the collective rapid-reaction force will only be made by CSTO heads of state on a consensus basis, the spokesman said, advising Ambassador Surikov not to make hasty assessments.
    Belarusian President Alexander Lukashenko attended the CSTO summit in Moscow and agreed to set up the collective rapid-reaction force and to contribute a 2,000-strong troop contingent.
    On February 4, when the presidents of the CSTO nations signed an agreement on establishing the collective rapid-reaction force in Moscow, Belta, the Belarusian state news agency, said this did not imply the involvement of Belarusian military personnel in military conflicts outside the republic.
    It appears that Minsk did not want to abide by its CSTO commitments from the very beginning.
    "Lukashenko has signed a document on establishing the collective rapid-reaction force in order to receive additional financial privileges from Russia and has quickly forgotten all about it," Yaroslav Romanchuk, president of the Minsk-based Mizes Center, told the paper.

    Nezavisimaya Gazeta, Vremya Novostei

    Russia trying to play on Ukrainian election ground

    Russia's Finance Ministry officially confirmed for the first time on Monday that Ukraine was asking the Russian government for a $5 billion loan to cover its budget deficit. Ukrainian observers are convinced that the money is needed for Prime Minister Yulia Tymoshenko's presidential campaign.
    The ministry insists that it was an unofficial request, but consultations are already underway. Therefore, if Russia eventually declines, officials could always say those were unofficial expert consultations as well.
    Ukrainian analysts insist that the $5 billion the Ukrainian PM claims was "promised" by Moscow is needed for next year's presidential race. It is needed to finance Tymoshenko's campaign, which is in fact underway already. Moscow, in turn, agrees to pay to put in power someone it could make a deal with, and not only on gas.
    Ukrainians are sick and tired of President Viktor Yushchenko's and his team's on-going bickering with Moscow amid declining living standards. Tymoshenko and her supporters in the Russian government are expecting to cash in on this situation, which is why she is trying to play the Russian trump card.
    That Russian officials are trying to play their own game on the Ukrainian election board is nothing new. A neighboring country like Ukraine is part of Moscow's sphere of interest by its location alone. President Dmitry Medvedev has declared advancing Russia's interests in the CIS to be one of his foreign policy priorities. But with Ukraine, the problem is that there is no guarantee that there will be any return on the investment.
    That country's foreign policy has remained unchanged under each new president, despite its protracted internal political crisis. It is equally unlikely to change after the next presidential election. Ukraine will drift further towards the West - the EU and NATO - whatever Moscow might do to hinder the process. There is nothing one can do.


    Gazprom produces 80% of gas from fields commissioned in Soviet time

    Natural gas production at the South Russkoye gas and condensate field in Yamal Peninsula costs Gazprom three times more than projects launched during the Soviet time.
    Such projects in fact account for 80% of the monopoly's output. Average production costs there are less than $10 per 1,000 cubic meters, a Finance Ministry source said.
    New projects are different, because they also include investment costs, $30-$40 per 1,000 cubic meters in the South Russkoye case (to make back 133 billion rubles in six years), said Denis Borisov, an analyst with the Solid brokerage. New fields in Yamal will incur even more investment costs.
    Gazprom has commissioned only two new fields since its incorporation in 1989 - Zapolyarnoye in 2001, producing 105 billion cubic meters a year, and South Russkoye in December 2007 with reserves estimated at 824 billion cubic meters and planned 2009 production of 25 billion cubic meters.
    The company has never disclosed its total project costs. Actual investment in South Russkoye was 133 billion rubles in 2005-2008, a Gazprom source told Vedomosti.
    In Zapolyarnoye, the company has invested around 140 billion rubles since 1994 (not including the transportation infrastructure), another source close to the company said.
    Gazprom's key project, Bovanenkovskoye, to begin production in 2011 with planned annual capacity of 140 billion cubic meters, may require an investment of $50 billion, the monopoly said earlier.
    Gazprom hasn't disclosed how much more it will have to invest in South Russkoye. All the capital investments have already been made, and the field is expected to reach its design capacity in mid 2009.
    Germany's Wintershall has shared investment in the project with Gazprom since last year. In December 2007, the German company paid nearly $2 billion for a stake in the project, simultaneously undertaking 35% of its costs.
    The source in Wintershall declined to disclose the amount invested, but it should certainly be above 8 billion rubles, the amount Wintershall contributed in late 2008 to the share capital of Severneftegazprom, the South Russkoye operator.


    Acer shifts its Russia trade into rubles

    Acer, the Taiwanese producer of computer hardware, is going over to direct deliveries and settlement in rubles with its Russian customers. Its decision to fix contracts in rubles will spare the distributors' currency risks, while direct supplies will put law enforcement's suspicions of "gray" imports to rest.
    In 2007, Acer earned $14 billion. According to its figures, in 2008 the company shipped equipment worth $850 million to Russia, while according to the IDC think tank, in the third quarter of 2008, Acer held 33.7% of the laptop market.
    Beginning in March, Acer will start billing its distributors in Russia in rubles, said the company's CIS head Gleb Mishin. "We will handle currency risks ourselves. At the end of 2008 and the beginning of 2009, they were perhaps the main problem for our partners," he said.
    Since 2008, the dollar has strengthened against the ruble by 55%. "In January, foreign currency-denominated costs made up almost 50% of the distributors' expenses," said Alexander Gukkin, the president of the Pirit company. "The switch to rubles will make business more profitable and less risky." Samsung, which shifted to the ruble settlement in 2007, only benefited from the increased loyalty of its Russian partners, he said.
    "Distributors have long been waiting for producers to start selling their equipment for rubles," said Khristo Karakashev, managing director of Verysell Distribution.
    The next step in Acer's restructuring will be to set up a subsidiary in Russia. Direct supplies to Russia will begin at the end of March.
    Experts say direct imports, when the distributor itself clears goods through the customs, guarantee retail networks and distributors against problems with law enforcement agencies.
    "The retail network is unable to check the path of the goods. And if the police find 'gray' items, these can be taken from the storage and sold under a tried and tested scheme," said Anton Guskov, PR director for the Association of Trading Companies and Manufacturers of Consumer Electronic and Computer Equipment.
    According to him, Samsung and Sony have switched to direct imports and ruble settlement on the computer market.

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