Today in Russian Business – July 23, 2009

A Chinese delegation has arrived in Moscow to discuss the closure of Cherkizovsky Market where 60,000 Chinese traders worked.  Putin has told Sberbank to continue lending, saying, ‘a significant part of the (branch) network is not profitable but you cannot abandon it. This is your payment for the state support’.  Sberbank head German Gref has complained that the idea of continuing to offer loans cheaply is unrealistic.  Deputy Prime Minister Dmitry Kozak has cut another 5% from the construction costs for the 2014 Sochi Olympics.  Avtovaz may stop car manufacturing for a month starting Aug. 3 because of a sharp decrease in demand.  Gaz will receive $180 million in state aid to build a diesel engine factory.  The German government has asserted that it is still backing the Magna-Sberbank deal for Opel.  An op-ed piece in the Moscow Times suggests that Russia’s propaganda machine is working so hard to convince people that the worst of the crisis has passed that when another wave hits, the public will face both being disillusioned and destitute.  To consider why IKEA is not the only company fearing investment in Russia, see the Moscow Times.