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Oct 17, 1997
Contortions Over Sanctions: Can U.S. Punish Russia's Gazprom for Deal With Iran?
New York Times,IHT              
Friday, October 24, 1997
U.S. Weighs Curbs On France's Total/ AFP/IHT

re TOTAL and the US trade wars over Iran embargo, for those
interested. TOTAL couldn't be less concerned. Clinton is
still looking for ways to get even. Perhaps he may try
to squeeze out the French (Cogema/TOTAL) in Chinanuclear plant construction ...

Check out the twist: 

"To make matters worse, it could
also mean going up against one of President Bill
Clinton's biggest financial supporters in last
year's campaign: Goldman, Sachs & Co.
The Wall Street firm, whose former co-chairman,
Robert Rubin, is now the Treasury secretary, is
underwriting the Gazprom bond offering."

So who is running the ubiquitous US government?  TOTAL
must be laughing all the way to the bank.
metta,dawn star
euroburmanet, paris
Worldwide TOTAL Boycott


Oh, and here is another one, just follow the money, while Asia paper tigers
tumble, Soros puts his profits elsewhere. 

October 17, 1997
Contortions Over Sanctions: Can U.S. Punish Russia's Gazprom for Deal With Iran?
David E. Sanger-New York Times,IHT
U.S. Weighs Curbs On France's Total/ AFP
International Herald Tribune
Friday, October 24, 1997

WASHINGTON - In the next few weeks the Clinton
                  administration will face the first test of its
                  willingness to make good on a threat to punish
                  foreign companies that invest in Iran.

                  But the State Department is not exactly leaping at
                  the chance to teach a lesson to Russia's premier
                  private company, Gazprom, for a $2 billion deal
                  with French and Malaysian companies to pump natural
                  gas off the Iranian coast.

                  Instead, officials are discovering anew that
                  imposing sanctions on foreign companies that defy
                  American policy - in this case by doing business
                  with a country that the United States asserts
                  supports terrorism - raises numerous unforeseeable

                  The issue is not whether Washington can stop the
                  investment in Iran. That is clearly beyond its
                  reach. Instead, it is whether Gazprom should be
                  allowed to raise $1 billion in world financial
                  markets, including the United States, next month -
                  money that will go right into the company's coffers
                  just as it is preparing to write the Iranians a fat

                  But stopping that deal threatens to unravel
                  delicate negotiations with European allies over
                  U.S. sanctions policy and to interfere with
                  Washington's efforts to stabilize the rickety
                  Russian economy. To make matters worse, it could
                  also mean going up against one of President Bill
                  Clinton's biggest financial supporters in last
                  year's campaign: Goldman, Sachs & Co.

                  The Wall Street firm, whose former co-chairman,
                  Robert Rubin, is now the Treasury secretary, is
                  underwriting the Gazprom bond offering. The company
                  fought long and hard to get Gazprom's business, and
                  many European investment houses would dance with
                  glee if Washington were to get in Goldman's way.

                  Even Stuart Eizenstat, undersecretary of state for
                  economics, business and agriculture, concedes that
                  if America tried to aim at Iran, the bullet would
                  ricochet everywhere.

                  ''This is a matter which has important implications
                  for our policy to deter Iran from acquiring weapons
                  of mass destruction and supporting terrorism,'' he
                  said Wednesday. But it quickly becomes enmeshed, he
                  added, in ''our broader relationship with our
                  European allies, the Russian government and the
                  government of Malaysia,'' to say nothing of the
                  impact on Wall Street.

                  The origins of the diplomatic morass are relatively

                  When Conoco Inc. tried to invest in an Iranian oil
                  field two years ago, the Clinton administration
                  stepped in, issuing an order barring American
                  companies from major investments in Iran as long as
                  Tehran sponsored terrorism and was attempting to
                  acquire nuclear weapons.

                  Then the French company Total SA swept in and
                  signed the deal Conoco was forced to abandon.

                  The outrage in Congress over Total's action led to
                  the passage last year of the Iran and Libya
                  sanctions act. Like the Helms-Burton act, which is
                  aimed at companies investing in Cuba, the Iran law
                  laid out sanctions that the president can impose
                  against foreign firms that invest more than $20
                  million in Iran's oil and gas industries, its main
                  source of revenue.

                  They range from minor punishments - cutting off
                  low-cost loans through the government's
                  Export-Import Bank - to far nastier sanctions,
                  including cutting off American bank loans exceeding
                  $10 million, in an effort to make sure that
                  companies flouting the investment ban in Iran do
                  not raise their funds in America. Until now, the
                  law has not been tested.

                  But two weeks ago, Total announced that it was
                  teaming up with Gazprom and Malaysia's state-owned
                  oil firm, Petronas, in the $2 billion gas project
                  in Iran

                  It was an important step: Iran's proven gas
                  reserves represent about 15 percent of the world's
                  total, second only to Russia's. ''Clearly, this is
                  a big test for us,'' a senior administration
                  official said. ''If Total and its partners get away
                  with it, every non-American energy firm on the
                  globe is going to race in after them.''

                  The administration's reaction was deliberately
                  muted. Mr. Eizenstat - fully aware of the explosive
                  nature of any sanctions threat in Europe - said the
                  State Department would take time to ''gather all
                  the facts'' on the gas deal.

                  Others hinted that sanctions might be waived if
                  France and the other countries made other
                  commitments to fight Iranian terrorism. A team of
                  experts was sent to Paris, Moscow and Kuala Lumpur.

                  Meanwhile the Iranians declared that the gas field
                  will earn them $450 billion over the next 30 years,
                  and said that the contract with Total, the lead
                  partner, went into effect Oct. 7.

                  The State Department's caution is understandable,
                  but the $1 billion debt deal seems likely to force
                  its hand. The transaction is Gazprom's first
                  venture into the world's capital markets with a
                  major bond issue, though it has sold its stock on
                  markets around the world and borrowed from Western

                  Goldman, Sachs says the $1 billion it is raising is
                  for ''general purposes,'' chiefly a major pipeline
                  project already under way in Russia. But clearly,
                  any cash the company can raise frees up money it
                  can invest in Iran.

                  While Goldman, Sachs will say nothing publicly
                  about the debt offering, a company official said
                  that ''this is a very important deal for us'' and
                  that Goldman's lawyers believe that the bond
                  offering does not violate the Iran-Libya sanctions
                  act, which makes no specific mention of debt
                  offerings. ''We are assuming it is not going to be
                  an issue,'' the official said.


                  U.S. Weighs Curbs On France's Total

                  WASHINGTON - The United States has not ruled out
                  imposing sanctions against the French oil company
                  Total over its deal with Iran, a senior
                  administration official said Thursday.

                  A team of State Department experts is in Paris
                  ''investigating with alacrity'' to determine ''the
                  facts of this case and to determine whether or not
                  this is sanctionable activity,'' said Stuart
                  Eizenstat, undersecretary of state for economic,
                  business and agricultural affairs.

                  ''If it is, sanctions are certainly a viable
                  option,'' Mr. Eizenstat said.
                  Total, with Russian and Malaysian companies, has
                  signed a deal to pump gas off the coast of Iran.

Tues. October 21, 1997
Huge Soros Gift to Russia/Financier Offers $500 Million for Projects
Judith Miller-NYT/IHT

NEW YORK - George Soros, the Hungarian-born
American financier and philanthropist, has
announced that he will spend as much as $500
million over the next three years in Russia to
improve health care, expand education and help
retrain military personnel to take civilian jobs.

Mr. Soros, speaking Monday in Moscow, said his
initiative would cover eight fields.

                  This gift, following others for hundreds of
                  millions of dollars, would make Mr. Soros the
                  largest philanthropist and individual Western
                  investor in Russia.

                  In the last decade, Mr. Soros, who was born in
                  Budapest 67 years ago and emigrated to the United
                  States in 1956, has donated close to $1.5 billion
                  promoting what he calls ''open societies'' - the
                  expansion of civil liberties, a free press and
                  political pluralism - at home and abroad.

                  Since 1994, he has donated in excess of $350
                  million a year to his foundations in more than 30
                  countries, spending more than $259 million in
                  Russia alone.

                  This new gift would make his foundation in Moscow,
                  the Open Society Institute-Russia, his largest
                  presence in any country, including the United

                  Mr. Soros's latest gift comes less than a month
                  after Ted Turner, the billionaire founder of Cable
                  News Network, announced that he would donate up to
                  $1 billion, or up to $100 million a year for 10
                  years, to benefit United Nations programs.

                  When he made his gift, Mr. Turner identified Mr.
                  Soros as the philanthropist he most admired, and
                  Mr. Soros returned the compliment.

                  Mr. Soros said in Moscow that he had spent the last
                  two weeks touring Russia. He stressed that while
                  the tour was ''rather strenuous and in some ways
                  frustrating,'' he believed that the Russian
                  government, led by President Boris Yeltsin, needed
                  and deserved Western confidence and assistance.

                  Acknowledging that rampant corruption and
                  mismanagement had created a ''precarious
                  situation'' for the Russian government, Mr. Soros
                  said he doubted it would collapse any time soon.

                  ''But during the next three years, the government
                  must deliver if it wants reform to continue,'' he

                  In addition to his philanthropy, the Soros Fund
                  Management, the principal investment adviser to the
                  Quantum Group of Funds, based in Curaçao, has
                  invested more than $2.5 billion in Russian

                  Mr. Soros said Sunday that he intended to continue
                  investing in Russia as a sign of confidence in the
                  country's leadership, despite controversy among
                  rival investors stemming from his decision to mix
                  philanthropy and investment.

                  Mr. Soros has emotional ties to Russia, where his
                  father was held prisoner during World War I.

                  As a child in Hungary, he said in a speech in
                  Moscow, he came to know Russian culture and greatly
                  respected its literary traditions and the
                  determination of its people to survive despite all
                  kinds of oppression. He began his philanthropy in
                  Russia in 1987 during Mikhail Gorbachev's reforms,
                  before the collapse of Soviet rule.

                  He is an American citizen who eluded German
                  roundups while a Jewish adolescent in Budapest and
                  settled in the United States in 1956, after
                  graduating from the London School of Economics.

                  Mr. Soros's international investments have come
                  under fire, particularly from Mahathir bin Mohamad,
                  the prime minister of Malaysia.

                  The Malaysian leader has repeatedly accused Mr.
                  Soros of mounting politically motivated attacks on
                  Southeast Asian currencies, which Mr. Soros has

                  During the summer, Mr. Soros shut down his
                  foundation in Belarus after Alexander Lukashenko,
                  the popular but autocratic Belarussian president,
                  fined a Soros foundation $3 million on charges of
                  tax violations and seized its bank account.

                  In the United States, Mr. Soros has been harshly
                  criticized for programs that challenge the nation's
                  strong antidrug legislation and other controversial

                  But the growing pressure on Mr. Soros's
                  philanthropic empire - which stretches from South
                  Africa to Haiti, employs more than 1,300 people and
                  has regional offices in New York and Budapest -
                  appears only to have stiffened his resolve to
                  promote political pluralism and economic reform.

                  This year alone, he opened five new offices in
                  Central Asia and another in Guatemala and announced
                  plans for nine foundations in southern Africa,
                  which would expand to 40 the number of countries
                  with Soros foundations.

                  Given his growing personal fortune, which friends
                  estimate at $5 billion, although he has not
                  commented on his wealth, he says his efforts are
                  likely to continue at current levels for at least a
                  decade, and perhaps for two.

                  Mr. Soros said that details of the new programs for
                  Russia were still being worked out, but that all
                  the money, which will total a minimum of $300
                  million and as much as $500 million in the next
                  three years, would be channeled through his Open
                  Society Institute-Russia.

                  He was forced to restructure the foundation and to
                  replace its leaders last year after discovering
                  that employees were diverting funds into Swiss bank
                  accounts and using money to buy luxury cars.

                  Mr. Soros said that some of the health-care money
                  would be used to set up three to five demonstration
                  sites that would offer programs to detect and treat
                  tuberculosis, both in prisons and in the general

                  Another new project will work to diagnose and treat
                  drug-resistant bacteria, a leading cause of death
                  in Russian hospitals and what Mr. Soros called ''a
                  major health threat not only in Russia but
                  throughout the world.''

                  Another of Mr. Soros's eight programs is to provide
                  funds for retraining members of the military for
                  civilian jobs.

                  He said his program was a response to a call from
                  Deputy Prime Minister Boris Nemtsov for help in
                  large-scale training of managers.

                  In education, Mr. Soros intends to expand a program
                  that provides selected libraries a choice of books
                  and periodicals at a much reduced cost. He will
                  also support library computerization.

                  Another program is aimed at bringing more Russians
                  into the computer age. In cooperation with the
                  government, Mr. Soros plans to establish Internet
                  centers in 33 provincial universities.