Economic News in Review
Sectors, Consumer Spending, Bailout Plans
October/November, 2008

 

The following resource is meant to quickly introduce the reader to some of Russia's major economic sectors and consumer spending in this time of world economic uncertainty.

 

Please note that we generally strive to focus on more specific, less-well-covered issues. This news review is developed via a partnership between three organizations: The School of Russian and Asian Studies, a study abroad organization which also produces several other reviews ("obzori") each month; The US-Russia Chamber of Commerce of New England, a business advocacy and networking organization which also features this obzor in its monthly newsletters; and Alinga Consulting Group, a business services company (audit, tax, accounting, payroll, legal, and HR), which also offers a monthly newsletter.   

 

To subscribe to any of these additional news services, send us an email with "Subscribe" in the subject field and indicate which publications you would like subscribe to in the body of the email.

 

Real Estate and Infastructure

 

Key Part Of Gulf Barrier Completed

A key part of the St. Petersburg Flood Protection Barrier was completed on schedule on Wednesday with Prime Minister Vladimir Putin welcoming the inauguration of the barrier's shipping canal.

 

Housing Construction Stagnating

Builders and government officials expect zero growth in the sector this year, and negative growth by 2010. Falling housing creation has been recorded in all federal districts.

 

Moscow Real Estate Overvalued

A number of real estate agencies report rising supply on the market since the beginning of the month. Experts say that is the result of a selloff of investment properties.

 

Investment and Stocks

 

The Full-Scale Attack

In another anti-crisis effort, the U.S. Federal Reserve slashed yesterday the key rate from 1.5 percent to 1 percent, i.e. to the rate of 2003. Stock exchanges soared 8 percent to 11 percent on expectations of cheaper loan facilities, while Russia's floors boomed 12 percent to 14 percent. Gazprom and Rosneft, where VEB had been injecting the money, went up above the prices of bank's first acquisitions.

 

Mandelson Says Russia Riding High in Crisis

Russia is well-equipped to withstand the financial crisis, and foreign investors are not jumping ship, British Business Secretary Peter Mandelson said Wednesday as he wrapped up a four-day visit that showed significant improvement in London's troubled ties with Moscow.

 

Russia and the Crisis. Kremlinomics

Why the Russian markets have fared worse than others.

 

Russia Stocks Tumble As Oil Falls, Rouble At 2-yr Low

Russia's stock market lost over a tenth of its value on Friday, hitting its lowest levels since late 2004 as a further oil price fall cast fresh doubts over Russia's ability to avoid a recession and defend its currency.

 

Russian Capital Flight at $33 bln in Aug.-Sept. - Finance Minister

"In August-September, investors took a total of $33 billion out of Russia," Alexei Kudrin said, speaking in the State Duma, the lower house of parliament.

 

Foreign Investors Praise Putin

Prime Minister Vladimir Putin told foreign investors Monday that Russia hadn't been caught off guard by the crisis, unlike the West, and the investors praised the government, saying they had faith in the local market.

 

Capital Flowing from Russia

For the first time since 2004, Russia is facing an outflow of capital.

 

Investors See Slowdown Through 2009

According to President Dmitry Medvedev's economic aide Arkady Dvorkovich, while the global financial system was already in crisis, the real sector of the economy was only at the beginning of the slowdown.

 

RTS and MICEX May Merge

Current and future partnership between Russia's main stock exchanges – the Russian Trading System and the Moscow International Currency Exchange – may result in their consolidation.

 

Russia's Floors to Stand Idle Oct 27

Stock exchanges of Russia went through another slump October 24. The trading was suspended and the plans are to resume it no sooner than October 28.

 

Stocks of Russia's Companies Called the Cheapest Worldwide

The index of Moscow Interbank Currency Exchange (MICEX) has slumped 73 percent this year, having suffered the heftiest losses amid 48 basic national indexes. The stocks of Russia's companies are the cheapest worldwide, Bloomberg concluded.

 

Demographics, Consumer Spending

 

Govt Calls For Calm, People Take Cash Out Of Banks, Fear Job Loss

The Russian authorities keep advising the nation to stay calm despite the world financial turmoil, but the average citizens seem to be ever more active in withdrawing cash from private banks. They are also afraid of losing jobs.

 

Impatience & Labor

Young Guard of United Russia has invented a new method to oppose financial crisis in the country. Pro-Kremlin activities will rally tomorrow under the "Our Money to Our People" slogan, demanding to ban labor migration, expel migrants from the country and patrol streets in search of the Gastarbeiters.

 

The Number of Employers with Redundancy Plans Has Doubled

Despite that the better part of Russia's companies have no redundancy plans, the number of those referring to staff reduction has stepped up from 10 percent to 19 percent, showed the survey of SuperJob.ru held amid 3,000 representatives of Russia's companies in October of 2008.

 

Russians Satisfied with Government

Almost half of Russians (49%) think the current personnel of governing bodies is the equal to the tasks facing the country and society. Thirty percent lack confidence in them. Five percent find them "completely inappropriate," according to a new poll by the All-Russia Center for the Study of Public Opinion.

 

Confident Consumers

Russian consumers are not making significant changes to their spending patterns, and this corresponds with consumer confidence readings, despite almost half the population fearing the economy is in recession.

 

Economic "Happy Talk" Fails to Sway Doubters

Following on the heels of two of Russia's top economic officials, the country's top two leaders (readers can decide for themselves which is No. 1) have made statements aimed at calming the fears of both ordinary Russians and foreign investors.

 

Voluntary Pension Fund

As of October 1, about 8,000 people wanted to participate in the state's Voluntary Pension Fund.

 

Street Crime Expected To Rise

The current economic crisis in Russia could trigger a sharp increase in street crime by newly unemployed foreign workers.

 

Has Depopulation Sneaked Up on Us?

By 2050, Russia's population could fall to 100 million (according to a UN estimate). The Russian Academy of Sciences' Institute for Sociopolitical Research predicts it will fall to 83 million.

 

Rich in Russia

The tradition of despising the rich is an inherent part of the Russian mentality.

 

Russian Public Unalarmed by Crisis

The majority of the public in Russia considers the financial crisis in the country a result of the world crisis and a "temporary phenomenon." Fourteen percent of the population does not even know anything about the crisis.

 

Salaries Present Mixed Picture

General research into salaries in Russia reveals specific features and trends — notably that salaries in general are increasing.

 

Crisis Spurs Uptick In Russia's Unemployed

The crisis in Russia is entering a more uncertain phase, as more companies cut staffing levels, slash salaries and trim working hours. It's a trend affecting not only those in low-paying manufacturing jobs, but also bankers, lawyers, stock brokers and insurance workers -- potentially posing a new challenge for the Kremlin.

 

The Lurking Ghost Of Unemployment

The analysts' resort to "anecdotal" evidence reflects a confusion acutely felt by ordinary people. That short fall of capital has given rise to a sense of anxiety amongst many workers in Moscow.

 

Retail

 

Gasoline Prices Falling at Pumps

TNK-BP has become the third oil company, after Gazprom Neft and Alliance, to reflect falling oil prices at the gasoline pumps throughout the country. Like its competitors, it plans to lower the price of gasoline and diesel by "an average of a ruble [per liter]."

 

Carmakers, Retailers Change Course

Rosstat issues structured information and analysis of the condition of individual sectors several months after the fact, but data from June and July make it possible to see points of instability.

 

Luxury Costs the Most in Moscow

Moscow is the world's most expensive city for the rich, American Forbes magazine claims. Executives spend the most here to maintain their lifestyles.

 

Soviet Brand Names Make Comeback

Many Russian companies have resurrected Soviet brand names recently. Those brands call up positive associations among many in the Russian population and reduce advertising expenses for the item to zero.

 

Russian Consumer Prices Still Rising Despite Plunging Share Prices

Rising prices, not falling share prices or teetering banks, remain the first concern of the average Russian.

 

Russian voices: Feeling the pinch

Russians have been telling the BBC how the financial crisis has changed their daily lives, and what they think of their own economic prospects.

 

Firms Show Caution In Accepting Cards

As distrust among banks spreads to retailers and consumers, signs are mounting that a worsening of the financial crisis could dampen businesses' willingness to accept credit and debit cards.

 

Waves Of Smuggled Russian Cigarettes Flood Europe

Smuggled Jin Ling, resembling the US Camel brand in appearance, are coming to light across Europe from Lithuania to Venice.

 

Goldman Sachs Looks Askance At Retail

Goldman Sachs has reduced its forecast for capital investment in the Russian retail sector for 2009-2011 from $9.9 billion to $4.9 billion.

 

Food and Agribusiness

Russian Vodka for the Russians

Soyuzplodoimport has proposed to Agriculture Minister Alexey Gordeev that a Russian Vodka Association be founded to monopolize the name "Russian vodka" in Europe.

 

Cash-strapped Russians Cut Food Spending

Consumers in Russia, frightened by the continuing financial crisis, are tightening their belts to save on food products.

 

The Business Boom Unfolding Down on the Russian Farm

Investors are pouring billions into agribusiness—and trying to reverse decades of Soviet mismanagement.

 

Rosrybolovstvo Cuts Fishery Quotas

Choosing the authorized companies has provoked a sandal, as Rosrybolovstvo crossed dozens of small fishing firms out of the list on suspected quota sale to foreign fishery companies.

 

Automotive

 

Duties on Cars to Rise Selectively

The Russian government will reconsider the import duty on foreign cars to support their production within the country.

 

AAA Auto Group Opens in Moscow

The AAA Auto Group, a major dealer of used cars in Eastern Europe, will open its first dealership in Moscow in spring 2009. The Dutch group was encouraged by the cancellation of double VAT payments on used cars effective in January.

 

AvtoVAZ Asks for a Billion

The carmaker has over 100,000 unsold vehicles (two months' production) stockpiled and needs money in order to defer dealer payments.

 

BWM Wants Tighter Import Control

The German company BMW AG has demanded that Russian customs ban the import of products containing its trademark without its permission.

 

Russian Auto Industry Wins Against WTO

Russia is breaking preliminary agreements made in the framework of the World Trade Organization and accepting applications for the production of automobiles through industrial assembly, under an order issued by the Ministry of Industry and Trade.

 

Technology and Mass Media

 

Web Registration in .РФ Zone to Begin in July

Russia will become the first nation with the non-Latin domain. The registration of web-sites in Russia will begin in early July and roughly 350,000 sites will probably emerge in two years.

 

Vodafone Eyes Moscow

The British cellular provider Vodafone, the world's largest such company by receipts, has announced that it is opening an office in Moscow. It will have to form a partnership with one of them. It has already reached an agreement with MTS on joint equipment purchases, content sharing and special offers for common clients.

A Silver Lining for Lovers of the Silver Screen

This is the first in a series of reports about the effect of the global financial crisis on Russia. This report looks at the film industry.

 

Minority of Russians on the Internet

The majority of Russians (69%) do not use the Internet at all, the All-Russia Center for the Study of Public Opinion found in a recent poll. In 2006, that proportion was 76 percent. Eleven percent of respondents use the Internet everyday (up from 5% in 2006).

 

Internet Becomes More Popular In Russia

The popularity of the Internet has doubled in Russia over the past three years, although more than half of Russian citizens do not log on.

 

New Prosecution Bid To Control Internet 'More Serious' Than Past Attempts

The General Prosecutor's Office has come forward with large-scale initiatives to introduce control over the Internet.

 

Airlines

 

Govt To Inject 30bn In Airlines

The RF government will commit Finance Ministry and the Central Bank of Russia (CBR) to elaborate proposals for crediting Russian airlines for the amount of up to 30 billion ruble, RIA Novosti reported.

 

SuperJet Tests Continue in Novosibirsk

The new Russian civil airliner Sukhoi SuperJet 100 was transported to Novosibirsk for key testing, RIA Novosti reports.

 

Aeroflot Profits in Nosedive

The net profit of Russia's largest airline fell by 55 percent compared to the same period of last year to $72.2 million, by international accounting standards.

 

Airlines Want Credit Too

Rosaviatsia is collecting applications from airlines for credit from state banks or state guarantees for credits. Meanwhile, the transportation minister will hold a meeting today with oil companies to discuss fuel deliveries under state guarantee. The price of airplane fuel has risen 70 percent in the last year.

 

Airlines of Russia Takes Off

Rostekhnologia general director Sergey Chemezov stated that his company owns 50 percent plus one share of the new airline. The remainder will belong to Moscow's city government.

 

President Orders Kerosene Prices Down

Oil companies have begun lowering prices for airplane fuel, after Russian President Dmitry Medvedev criticized the situation on the market last Thursday. LUKOIL announced a 9-percent reduction in price (that is, about 2000 rubles per ton).

 

Banking

 

Economic Darkness Descends on Putin's Russia

Putin unveiled a plan to stanch the capital flow out of Russia, blocking banks from turning bailout funds into foreign currency. But some fear that restrictions now being clamped onto the financial system will harm the business environment in the long run.

 

Strict Control over Bank Expenditures

Sufficient funds have been allocated to Russian banks to support their liquidity, and control over their expenditures will be quite strict, Russian First Deputy Prime Minister Igor Shuvalov told Vesti news channel. "The money funds provided to the banking sector are sufficient and the banks have enough liquidity to carry out two important functions: clearing operation and provision of credit," Shuvalov said.

 

Russia Appropriates $3bn to Alfa Group, Rosneft

Russia's government has appropriated roughly $3 billion to Alfa Group consortium of Mikhail Fridman and the state oil giant, Rosneft. The purpose to attain is to help refinance foreign debts of those majors, Reuters reported with reference to the sources with the RF government and industrial community.

 

Bankers, Importers Prompted Not to Trust Each Other

Russia's Federal Customs Service (FCS) reported yesterday the significant delay in transfer of the customs payments through the banking system. The advice to importers was to be more careful when choosing the banks.

 

Sberbank Won't Save Personnel

Sberbank President German Gref has informed the staff about impending reduction, blaming the inevitable dismissal on the need to improve business efficiency rather than on financial crisis.

 

Individuals Withdraw Money From Banks

In September, the balance of individual accounts with Russia's biggest 50 banks lowered by 54 billion rubles or 1.2 percent of the aggregate amount.

 

Russia Approves Loan Plan to Ease Credit Crunch

Russia's Parliament passed a law unlocking Central Bank lending to private banks in a $36 billion bailout , continuing the anti-crisis strategy here that has essentially relied on making the government's windfall oil profits available to banks, hoping they will in turn lend to companies and maintain economic growth.

 

Education is the key to improving profitability in Russian banking sector, regulator says

Greater transparency in lending practices necessary for Russian banks to be more competitive internationally

 

Medvedev Tells Russians: Your Money Is Safe In Banks

Russian President Dmitry Medvedev said his personal savings were safe in the bank and held himself up as the example to follow in an interview published Wednesday to sooth growing distrust among his countrymen.

 

Bank Asks Clients To Pay Off Mortgages

Midsized lender RosEvroBank has asked clients to pay back their mortgages right away rather than risk the prospect of real estate prices falling 30 percent.

 

Putin Promised 950bn to Banks

The loan is given to improve stability of Russia's banking system, it will step up capital of the banks and ensure liquidity.

 

VEB Develops Hand over Fist

Russian Prime Minister Vladimir Putin and the supervisory board of Vneshekonombank – Development Bank have approved the criteria for the crediting of companies using the $50 billion allocated by the government to refinance Russian foreign debt.

 

Foreign Banks Stop Mortgaging

Foreign banks operating in Russia are cutting back their ruble mortgage programs. Unicreditbank has set the highest interest rates on the market and GE Money Bank has temporarily halted it housing crediting program and its refinancing programs.

 

Central Bank Enters the Stock Market

The Russian State Duma passed the first reading of a bill on Friday to allow the Central Bank to perform operations with securities on the open market.

 

Investment Banks Struggle to Adapt

After almost a decade of lightning-quick growth and skyrocketing salaries, Russia's investment banking sector has been brought down to earth with a thud by the global financial crisis.

 

Russia's Senate Approves Law to Support Country's Financial System

The upper house of Russia's parliament approved a law on extra measures to support the country's financial system, allowing the issue of subordinated loans to the largest banks and lending to rated Russian banks.

 

Central Bank Plugs Another Capital Leak

The authorities have found another way to stanch the outflow of capital from Russia, which has exceeded $50 billion in the last two months.

 

Deputies Approve $18.5Bln Bailout

The State Duma took less than two hours to approve a raft of bills allowing the government to spend more than $18.5 billion bailing out troubled banks and supporting the plummeting domestic stock market.

 

CBR Injected 182bn Without Security

Russia's banks have raised 182.6 billion ruble with the Central Bank of Russia (CBR) without any pledge via the auction, RIA Novosti reported. The cut-off rate stood at 9.76 percent on year for three-month loans. CBR was ready to grant up to 200 billion ruble to the banks.

 

     Soverign Lending, Ratings

 

Moscow Surrounded By Poor Relation

Standard & Poor`s (S&P) lowered to pre-default the ratings of state companies controlled by the Moscow Region – Mosobltrustinvest, a division of Moscow Region's Mortgage Agency and Mostransavto.

 

Iceland Holds Talks With Russia on $5.5 Billion Loan

A delegation from Iceland is to start talks in Moscow on securing an emergency loan from Russia of as much as 4 billion euros ($5.47 billion) after the island's three largest banks collapsed.

 

Massive Loan A Strategic Win For Russia

Reports that Russia is considering offering a four-year, 4 billion-euro loan to Iceland hardly made ripples in the ocean of news coming out about the expanding global financial crisis.

 

The Buck Stops Here

Countries hit by the ongoing financial crisis are frantically looking for loans to build foreign currency reserves and fund expensive bailout plans. Some leading analysts are now asking: Can Russia become an international lender of last resort?

 

Russia To Evaluate Itself

Russia's Ministry of Regional Development has approved a new rating of regional competitiveness known as "IRPEX".

 

Russian Credit Rating Outlook Cut to Negative by S&P

Russia's long-term sovereign credit rating outlook was lowered to negative by Standard & Poor's Ratings Services because the cost of the government's ``bank rescue operation'' may increase.

 

S&P Negative on Russia's Sovereign

Standard & Poor's rating agency has reacted to Russia's possible spending from its national prosperity fund by lowering the country's sovereign credit rating outlook from stable to negative yesterday.

 

Gas and Oil

 

Energy Cos. Get $9 Billion in Loans

Russia's four largest oil and natural gas companies were promised the $9 billion in aid. Of that amount, $4.2 billion will go to state-owned Rosneft.

 

Alekperov Advocates Creation Of North Consortium

LUKOIL CEO Vagit Alekperov suggests creating a consortium to develop the continental shelf of northern seas. Alekperov made the respective statement October 27, during the Congress of Geologists, PRIME-TASS reported.

 

Rosneft Named Growth Leader

The Platts agency has published its annual list of the Top 250 Global Energy Companies. Russian companies made a good showing based on the main criteria of value of assets, receipts, net profit and return on invested capital.

 

Gazprom Neft to Slash Investment Program, LUKOIL to Shelve Refining Projects

With today's prices for crude oil, Gazprom Neft will slash 2009 investment program by 20 percent to 25 percent on year, the company's vice president Vadim Yakovlev told reporters Wednesday.

 

LUKOIL Seeks VEB's Aid

Russia's LUKOIL has applied to VEB for raising the loan, although the negotiations about terms of the credit facility are still underway. The oil company needs $1.8 billion.

 

     Pipelines

 

The East Siberia/Pacific Ocean (ESPO) oil pipeline

A strategic project - an organizational failure?

 

Russians Build Turkey-Syria Pipeline

The Russian Stroitransgaz company has signed a contract for the construction of a natural gas pipeline from Aleppo, in northern Syria, to the Turkish shore. The deal is worth $71 million. The pipeline is to be built within 18 months.

 

     Export Issues

 

Price of Reseller's Services

On the face of it, the scandal over Yugorosgaz, which is resells Russian gas to Serbia, is a purely economic matter. Moreover, the scandal appears to have its price - €35 million – the sum Yugorosgaz charges for its services. Of course, for Serbian consumers, who have to pay for another link in the gas trade chain, which has become too long, the sum is pretty big. Especially given the current economic crunch.

 

Oilmen to Surrender 40% Discount to Customs Service

Despite the government's decision to lower the oil export duty from $372.2 per a ton to $287.3 per a ton starting from November 1, 2008, the customs authorities will transfer to the new rate only after November 15, i.e. the oilmen will pay previous duties over the first two weeks of this month.

 

Oil Exporters Call for Monthly Duties

The Union of Oil Exporters (SONEK) has requested the government to shorten from two months to a month the term for calculating duties on oil export, Interfax reported.

 

Gov't Evens out Petro Product Duties

The Ministry of Energy and conciliated among state agencies on the establishment of a unified duty on heavy and light petroleum products at the level of 54 percent of the rate for oil.

 

Putin Laments Russia's Dependence On Raw Material Exports

Over the past eight years the volume of Russian foreign trade has gone up 2.2 times, Putin told a government meeting on Monday (27 October). Nevertheless, the structure of foreign trade, according to him, "still remains unsatisfactory".

 

Oil Companies Think Budget May Flop

Oil companies, which not long ago claimed that "the days of cheap oil are gone forever," are now rapidly lowering their forecasts for oil prices in 2009. Some pessimistic estimates place the price at $45 per barrel. The Russian federal budget will only remain balanced at a level of $60 per barrel.

 

Europe Saves Russia's Gas

Export of Russia's gas shed 8.3 percent on year in October. The key buyers lowered their demand after prices were hiked to $460-$520 per a thousand cu meters. But this will hardly prevent the monopoly from generating record revenues of $75 billion to $77 billion this year.

 

To receive Billion From China On Credit

Rosneft has found a way to survive the financial crisis. The company is in negotiations for a 20-year contract for oil deliveries to China. In exchange, it is counting on receiving a $12-15 billion credit. Transneft can expect another $8-10 billion from it.

 

Russia To Trim Crude Export Duty To $304-$309

The limiting duty on crude oil export will probably sink to between $304 and $309 per a ton starting from December 1, 2008.

 

Gas, Arms Major Exports For A Long Time

The Russian government approved a strategy for foreign economic activity through 2020. The strategy calls for the creation of an agency to insure export contracts as part of Vneshekonombank next year and support for exporters facing disappearing credit credit opportunities from foreign banks through state insurance.

Rosneft Ready for Chinese Contract

Chinese Prime Minister Wen Jiabao arrives in Moscow for meetings with Russian Prime Minister Vladimir Putin.

 

      Price controls

 

Russia Pushes an 'OPEC' for Natural-Gas Nations

The world's biggest suppliers will meet in Moscow on Nov.18 to finalize plans for a cartel to control gas prices.

 

Oil Cos. Face New Monopoly Charges

The Russian Federal Antimonopoly Service has begun another series of cases against the country's large oil companies for refusing to lower prices for petroleum products on the domestic market.

 

Russia May Create Oil Reserve To Influence Prices

The resurrection of a decade-old idea of inventories comes as another sign of Russia's growing ties with OPEC.

 

Russia Won't Cut Oil Output, May Build Spare Capacity

Russia may build a margin of spare oil production capacity as a means of influencing prices and won't cut output with the Organization of Petroleum Exporting Countries, Deputy Prime Minister Igor Sechin said.

 

Russia, Iran, Qatar Agree on Gas OPEC

Qatar, Iran and Russia have agreed on the conditions for the creation of a "gas OPEC," announced Iranian Oil Minister Gholamhossein Nozari, after negotiations with the Qatari energy minister and Gazprom head Alexey Miller.

 

OPEC Unlikely To Win Russia Help In Cutting Oil Output

The Organization of Petroleum Exporting Countries was unlikely to receive help from Russia, the world's biggest oil exporter, despite the cartel's plea for non- OPEC producers to share the burden of cutting output.

 

OPEC Cuts May Foil Bank Rescue

At an unscheduled meeting in Vienna, the OPEC cartel reduced its petroleum production quota by 1.5 million barrels per day. On Friday, Russian Urals oil has already dropped to $58.60 per barrel.

 

     Gazprom

 

Gaz de France Takes Gazprom to Canada

Gaz de France Suez, formed from the merger of Gaz de France and the Franco-Belgian Suez, Europe's largest gas concern, has signed a development strategy with Russia through 2013.

 

EU Lets Gazprom into Distrib Network

The new requirements allow the same company to control the production and transport of gas. The ban on third-country access to EU energy assets has also been lifted, so that the issue can be decided by individual countries.

 

Gazprom Courts Alaska as Palin Warns Against Russian Aggression

OAO Gazprom offered to help Alaska develop its natural resources, as Russia's largest energy producer seeks to expand into the U.S. amid the worst chill in relations since the Cold War.

 

Russian Gas Executives Visit Palin's Turf

Senior officials of Gazprom said at a shareholder meeting in Moscow in June that the company was seeking to take part in a consortium that is building a natural gas pipeline from Alaska to Canada.

 

Gazprom Not Crisis-Proof After All

A report published by Gazprom yesterday acknowledges for the first time that the company may encounter problems attracting credit and refinancing its debt. At the same time, it became known that the gas monopoly is holding a competition to receive new credit and that it does not expect to show an increase in receipts or profit this year, in spite of high indicators in the first quarter.

 

Gazprom to Post 2008 Net Profit of $35bn

Russia's gas monopoly, Gazprom, will generate over $35 billion as the net profit by this year's result, Gazprom CEO Alexei Miller promised in the interview with the NTV TV Channel of Russia.