Ukraine Gambling Ban To be Lifted

KIEV, Ukraine -- Reports from Ukraine indicate that the draconian ban on gambling in that country may be reconsidered at a Cabinet meeting scheduled for next Monday.
Apparently proposed legislation has been drafted that could re-regulate the pastime as early as January 2011 - in good time for a major international football championship event in 2012.

Details on the draft that will be discussed Monday are at present scarce, but there are strong indications that it may be approved.

Since the ban went into effect in June of last year , local gamblers have flocked to the internet, assisted by a multitude of clubs offering internet services linked with offshore online casinos in addition to personal internet facilities.

Ruble Posts Record Gain on Oil Surge

The ruble jumped more than 2 percent against the dollar Monday, tallying up a record gain as oil rallied and equity markets surged.
The currency rose 2.4 percent against the dollar to 31.05, following through on last week’s 2.9 percent rally. Monday’s jump was the largest single-day jump since 1999, Bloomberg reported.
The ruble has gained 16 percent against the greenback since February, and is 5.5 percent off its July lows. The ruble gained 1.8 percent against the Central Bank’s basket of 55 cents and 45 euro cents to close at 36.99.
Prices for Urals crude, Russia’s main export blend, set the stage for the currency’s rise, as it advanced for a fourth day to more than $65 per barrel on a weak dollar and fresh hopes for a global economic recovery. The commodity is up nearly 15 percent on the year.
Energy stocks rose in sympathy with oil, setting off a rally in broader markets, with positive news from the U.S. economy doing its part to send exchanges higher, as leading economic indicators rising for the third straight month in June raised hopes that a global recovery could be around the corner.
The MICEX Index closed the day up 2.9 percent at 994.28 after briefly breaking the 1,000 mark, while the dollar-denominated RTS closed slightly over 5 percent higher, at 972.31.
The ruble’s growth is not likely due to any fundamental changes in the economy, however, and may be little more than a technical bounce.
The ruble has been oversold since July 1, when the Central Bank lifted restrictions on how much foreign currency Russian banks can hold as part of their overall assets, said Yulia Tseplyayeva, chief economist at Merrill Lynch.
“Once the restrictions were lifted, money went out of the ruble and into other currencies and eurobonds,” Tsyplyaeva said.
Monday’s rally in oil prices sparked an overdue upward correction in the currency’s price, she said.
“This was much more of a technical event than a fundamental one,” she said. “Although capital inflows have improved and investor sentiment is more positive, the economic picture is largely the same as it has been.”
Traders, however, chose to focus on the short-term outlook, bidding up blue chips to extend a weeklong rally in the equity markets.
Norilsk Nickel was the day’s biggest gainer, climbing 5.6 percent as copper hit a nine-month high on a weaker dollar and improving economic sentiment, with some analysts expecting growth in demand for industrial metals toward the end of the year.
Gazprom shares rose 4.1 percent for a sixth straight day of gains, while Sberbank gained 2.7 percent, as a rising ruble made deposit withdrawals or conversions less likely.

Ruble Collapse Brings Wages Back to Earth

The days of spectacular wage growth that made Moscow an international employment destination have come to an end, economists say, with layoffs throughout the economy letting employers bring salaries back in line with productivity growth.The earnings cuts, alongside inflation and the weakening ruble, have dealt Russian wage earners a triple whammy, and the Central Bank's devaluation of the currency Thursday brought it past the 32 mark against the dollar for the first time since the 1998 redenomination .Over the past few years, real wages have increased at roughly twice the rate of worker productivity. Now that the value of the ruble is falling — and the job market is shrinking — employers say they'll be able to start paying employees to match their output.In just the past four months, investment bankers accustomed to annual salary jumps of 30 percent are now being offered new jobs at 40 percent of what they had been making. In advertising, sales and marketing, job candidates are facing salary decreases of more than 10 percent, according to recruitment agency Antal Russia.Yevgeny Nadorshin, chief economist at Trust National Bank, said the devaluation would correct what were previously "overvalued" wages and give employers a leg up in contract negotiations. "Eventually it will attract more companies to Russia and help us weather the crisis better," said Elina Ribakova, chief economist at Citibank.Wages grew 12.4 percent year on year in the third quarter of 2008, according to the most recent figures from the State Statistics Service, while productivity — real output per employed person — during the same period increased 8.24 percent, based on figures from Haver Analytics.The data already reflect a slowdown since the second quarter, when wages rose 12.6 percent year on year and productivity increased 5.93 percent. In the second quarter of 2007, wages increased 16.7 percent year on year while productivity rose 6.43 percent.For workers, though, "devaluation means high inflation" in the short term because of Russia's strong dependence on imported goods, Nadorshin said. Though inflation growth fell to a four month-low in December of 0.7 percent, the rate will rise once discounts from cash-strapped foreign producers disappear, he said. After the 1998 crisis, many Russia-based multinational companies paid their employees in foreign currencies or in rubles at the going Central Bank rate, but with increased stability over the past three to four years, many have switched to a fixed ruble salary.Tremayne Elson, managing director at Antal, said salaries were typically calculated at an exchange rate of about 28 rubles to the dollar and were not renegotiated to reflect inflation. Steve Castelete, president of Avalon Logistics Russia, said that most of his employees' salaries had been set to an exchange rate of about 27.5 rubles per dollar after the company switched to paying in rubles five or six years ago. Employees benefited during the years the ruble appreciated, Castelete added. According to Antal's figures, a "large number" of companies have already cut salaries, particularly in the banking and construction sectors. Castelete said Avalon had not yet been forced to reduce its workforce."We're not seeing a correction of salaries at the moment, but we would expect that they would become more realistic as more workers come into the marketplace," he said, referring to contracts for new hires. The shift will be what Danilo Lange, general manager of communications agency Louder Russia, calls a "market cleansing.""It was very difficult to find people for good value the last four years. The employee market was basically empty and everyone wanted super-high salaries," Lange said, clarifying that he believed his employees "deserved" their respective salaries.Louder re-evaluates its ruble-denominated salaries every six months to account for inflation, he said. While the company has not made wage cuts, they did eliminate 2008 bonuses."There's going to be more balance this year," said Castelete, of Avalon. "And I think that's a good thing."