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Today in Russian Business – Feb 2nd, 2009

Companies are still cutting production and jobs, causing Russian manufacturing to contract at its second-fastest pace on record last month.  Anatoly Chubais, chief architect of privatization in Russia during the 1990s, says the government needs to base its fiscal policy on the bleakest possible forecast.  Rostelecom and MegaFon have signed a record $460 million sponsorship deal for the 2014 Sochi Olympics, as the government considers revising the games’ budget in view of the global economic crisis.  Prime Minister Vladimir Putin says the project ‘is guaranteed to be financed’.  Finance Minister Alexei Kudrin has announced that the government will be forced to spend a significant portion of its $215 billion stabilization fund to cover this year’s budget deficit.  Oleg Deripaska forecasts ‘no more happy times’ for the aluminum industry, as rising prices couple with flagging demand.  The government could take a minority stake in Deripaska’s Rusal to help the company restructure its debt.  Russia boosted its gold output by 13.3% last year.  ‘Everyone I spoke to says it’s the grimmest Davos they’ve ever been to.’