Russia

General Motors' new board may still sell its money-losing European Opel unit to a group led by Canadian auto parts maker Magna, but it needs guarantees that Opel's technology won't be used in Russia to compete against GM's Chevrolet, according to a person briefed on the sale talks, The Associated Press reported. The board on Friday balked at picking between bids for Adam Opel GbmH from a group led by Magna International Inc. that includes Russia's state-owned Sberbank, and one from GM's preferred bidder, Brussels-based investor RHJ International SA.

The recession has deflated Russia's oil-fueled construction boom, delaying plans to turn Moscow into a high-rise Dubai of the East, The Wall Street Journal reported. The sudden slump in oil and commodity prices ended eight straight years of economic growth. It also clipped property developers' wings. The $15 billion Moscow-City business district is one of the downturn's most eye-catching victims. Dreamt up as a rival to New York's Manhattan or London's Canary Wharf, the district was a showcase development the Kremlin hoped would reflect Russia's rising clout on the world stage.

A unit of Russian residential developer PIK Group, which is in debt to the tune of $1.3 billion and engaged in lengthy restructuring talks, faces a bankruptcy lawsuit, court filings showed on Monday. Leasing Force has filed the bankruptcy lawsuit against OOO PIK Development in the Moscow Arbitration Court, the court database showed. A PIK spokeswoman declined to comment, saying the company had not fully examined the court filing, Reuters reported.

A consortium of bidders for Opel led by Magna International will make a new offer for the German carmaker on Monday which includes a demand for rights to Opel’s intellectual property, a Russian newspaper reported. Citing a single source, the Russian daily Kommersant said the consortium, which includes Russian state bank Sberbank, would make the new offer “in the form of an ultimatum” and leave the talks if it was not accepted, The New York Times DealBook blog reported.

Russia’s economy shrank 10.1 per cent in the first half of this year, the economy minister said on Wednesday, its worst decline since the early 1990s. The credit crunch, falling commodity prices and a gradual rouble devaluation have shattered 10 years of rapid growth but there are signs that the pace of economic decline is slowing, the Financial Times reported.

Russian developer RTM, which is struggling to restructure debts, has filed for bankruptcy in the Moscow Arbitration Court, the court said on Wednesday. RTM spokesman Viktor Belyonyshev confirmed the company had submitted the filing which is the first bankruptcy filing by a public Russian developer, Reuters reported. Read more.

The International Monetary Fund approved plans on Wednesday to issue its own debt to strengthen its capacity to fund bail-outs, the Financial Times reported. Meanwhile, the World Bank said it committed a record $59 billion in loans and guarantees to developing countries in the year to June 30.

The federal bankruptcy court filing earlier this week by Sea Launch Co., the last remaining U.S.-based commercial satellite launch provider, could hand its European and Russian rivals new opportunities to gain control over the industry, The Wall Street Journal reported. The filing underscores the financial weakness of the commercial satellite launch business in the U.S. The partnership's woes are in stark contrast to the expanding, government-supported launch operations aggressively marketed by Russia and the European launch consortium Arianespace.

Beijing is diversifying its overseas investments and pressing U.S. officials for an "exit strategy" from the ultra-loose fiscal and monetary policies that China fears will eventually inflate away the value of its U.S. bond holdings and fell the dollar. But China's pragmatic policymakers also know there is no practical alternative to the dollar as the world's main reserve currency.

Russian President Dmitry Medvedev, opening the St Petersburg International Economic Forum, said on Friday the global economy had avoided the worst but warned participants it was too early to celebrate recovery, Reuters reported. The global financial crisis has hit Russia harder than any other big emerging market but Medvedev said in generally sober remarks that the country had stabilized its financial system and followed appropriate policies.