31 May 2009 | Russia Economic Scan

31-May-2009

Russia Economic Scan

In this edition: Russia to discuss WTO entry with EU and US, Arctic may hold 30% of undiscovered gas, Russia's VTB will peg management bonuses to stock price, Ruble extends biggest monthly rally since 1995, Russia's Svyazinvest plans IPO after reform.

Top headlines

Russia to discuss WTO entry with EU, U.S. next week

• he European Union, the United States and Russia will hold detailed ministerial talks next week on Moscow's bid to join the World Trade Organization, diplomats said on Friday.
• "This is a shift from the technical level to gauge the temperature at a high political level to see if the outstanding issues can be resolved soon," a diplomat familiar with preparations for the talks told Reuters. (Reuters)

Arctic May Hold 30% of Undiscovered Gas, Strengthening Russia

• The Arctic probably holds 30% of the world’s undiscovered gas and about 13% of the oil, a group led by Donald Gautier of the U.S. Geological Survey said in a paper published in the latest edition of Science magazine. The study was billed as the first detailed estimate of the region’s natural-resource wealth.
• “These findings suggest that the future preeminence of Russian strategic control of gas resources is likely to be accentuated and extended,” Gautier said from in Menlo Park, California, in an audio file posted on Science’s Web site. (Bloomberg)

Russia VTB says to peg bonuses to share price

• VTB, Russia's second-biggest bank, will peg management bonuses to the company's share performance, Chief Financial Officer Nikolai Tsekhomsky told minority shareholders at a Friday meeting.
• "Most likely, this will concern members of the management board and a number of top managers," Tsekhomsky said. (Reuters)

Ruble Extends Biggest Monthly Rally Since 1995; Stocks Climb

• The ruble rose, extending its biggest monthly advance against the dollar since 1995, as oil headed for its best month in a decade. Stocks rallied to the highest level since September.
• Russia’s currency appreciated +1.5% to 30.8610 per dollar in Moscow trading, bringing this month’s gain to +7.5%, the steepest jump since June 1995. OAO Rosneft, the nation’s largest oil company, led the Micex Index to a +4.5% advance. The equity benchmark rose +22% in May, its best month since March 2000 and first six-month rally in seven years. (Bloomberg)

Russia's Svyazinvest plans IPO after reform - CEO

• Russian state-controlled telecoms giant Svyazinvest may hold an initial public offering on Western bourses once its reorganisation is completed, its general director said on Saturday.
• The Russian government on Friday cleared the reorganisation of Svyazinvest under the umbrella of Rostelecom which is designed to increase the holding company's efficiency and reveal the fair value of its assets. (Forbes)

Source: Russia Economic Scan