LG Telecom, set up in 1996, is a consortium led by the industrial conglomerate, LG Electronics. Until now BT’s biggest investment in Asia has been in Japan.. GLOBAL MARKETS face another roller-coaster ride today following last night’s dramatic collapse of a political deal in Russia that could have paved the way for economic recovery. Instead, more political turmoil in Russia appears inevitable.

Earlier yesterday Western leaders had given cautious approval to what appeared to be a compromise deal between the Duma, the Russian parliament, and Viktor Chernomyrdin, the acting prime minister. However, the Communist members of the Duma abruptly withdrew their support for the confirmation of Mr Chernomyrdin as prime minister.
Also yesterday, a leading German banker warned America that President Clinton’s visit to Moscow this week should not be used as an excuse to argue for favourable terms for US lenders. President Boris Yeltsin is due to host the American President on 1-3 September for talks on the financial crisis.Martin Kohlhausen, the president of the German banking federation, said he was concerned the US would seek preferential treatment in Russian debt restructuring in the visit. “I don’t think this is primarily about providing further money to clean up Russia’s finances, but is a race by creditors and investors. The Americans want preferential treatment in debt adjustments,” he said.Mr Kohlhausen said that all Russia’s international creditors should be treated equally. Germany is Russia’s largest foreign lender with an exposure of over pounds 25bn.”If there is preferential treatment as a result of political pressure I would not be impressed,” said Mr Kohlhausen, also chief executive of Commerzbank.

“That would promote the feared lopsided development of the world financial system.”But Mr Clinton’s visit may be overshadowed by the political upheavals in Moscow. Western observers and Russian reformers are worried that the Communists in the Duma want to “turn the printing presses back on” and issue extra roubles, risking hyperinflation.Earlier, when the compromise deal appeared to have been clinched, the Clinton administration said that continued financial support still depended on actual reforms in Russia. Lawrence Summers, the Deputy Treasury Secretary, said yesterday: “What is crucial is not words at this point, but the actions the Russians are able to take at what is a critical juncture for them and their management of the economy.”Mr Summers said the terms of Russia’s IMF package would have to be renegotiated before any new IMF loans could be discussed.Michel Camdessus, the IMF managing director, said on Saturday that Russia would get the next $4.3bn instalment of its $22.6bn bailout if it put economic reforms in place. The constitution which he struggled hard to introduce had never been amended. And Russia’s generally weak Communist-dominated parliament had never scored a comparable triumph. But the power-sharing agreement struck between the Kremlin, parliament and the acting Prime Minister, Viktor Chernomyrdin, was fragile from the start.
Last night it seemed to have succumbed already to political infighting, as the Communists – whose support was vital – said they would not accept the deal. Their leader, Gennady Zyuganov, suddenly announced that they would not be voting to confirm Mr Chernomyrdin as Prime Minister.

Hardliners within the party had clearly placed him under pressure to extract more concessions.Earlier in the day, it seemed an accord might be reached to put an end to the political limbo created when President Yeltsin fired his entire government more than a week ago.No doubt Mr Chernomyrdin still hopes disaster can be averted, that the Communists will pull back, and that Russia’s lower house of parliament will confirm his nomination as Prime Minister, possibly later today in time for the start of tomorrow’s summit in Moscow between President Yeltsin and his American counterpart, Bill Clinton.The most crucial part of the agreement concerned the planned transfer of the right to veto the Prime Minister’s ministerial appointments from Mr Yeltsin to parliament.The Kremlin was always determined to keep control of the crucial “power” ministries – foreign, defence, and interior – and the federal security services. However, they admit that nobody has been diagnosed as having developed heart and lung diseases as a result of taking the drugs.SmithKline and Medeva dismissed the allegations and said the diet drug was safe.. The researchers from the Massachusetts Institute of Technology say that phentermine, a popular anti-obesity treatment, could damage patients’ heart valves and lungs when taken with anti-depressants such as Prozac. The two drugs are often prescribed together in the US to patients attempting to lose weight.
The two companies vigorously rejected the charges, saying that the MIT lecturers’ findings were based on rat studies from the 1970s which, in fact, explicitly contradict the authors’ hypotheses.Medeva also made counter allegations that one of the researchers had a conflict of interest as he was the co-inventor of a rival diet drug.Drs Timothy Maher and Richard Wurtman, the two researchers, make their allegations in a paper on Wednesday to the International Congress on Obesity, in Paris .In the study, abstracts of which have been seen by The Independent, the two argue that the combination of phentermine, which is not sold in Britain, and Prozac could destroy the ability of the body to control serotonin in the blood.Too much serotonin damages blood vessels, particularly in the lungs, and can harm heart valves. SMITHKLINE BEECHAM and Medeva, two of the UK’s leading pharmaceutical groups, were locked in a bitter row last night with two US researchers who have alleged that one of their diet drugs could cause heart and lung problems. LVMH, the French luxury goods group headed by Bernard Arnault, is one of nearly 70 parties who have expressed an interest in buying Yardley from the receivers, it emerged over the weekend. The English perfume company with a 200-year history went bust last week with debts of pounds 120m.
The joint receivers, Tony Thompson and Roger Oldfield of accountants KPMG, are searching for someone to buy Yardley as a going concern.A spokesman for KPMG said yesterday: “We are unable to confirm individual names of people who have have contacted us, but we can say that there has been very strong interest in Yardley so far, which is very encouraging as it is still early days.”.

RACAL has put its telecoms arm up for sale once again after dropping plans for a flotation. A number of groups are understood to be interested, including Scottish Telecom and Energis. Sources close to Racal say that the company is looking for up to pounds 800 million for the subsidiary, way ahead of the pounds 450m price tag it was looking for last year when it failed to clinch a deal.
Since then telecommunications companies have enjoyed a good run on the stock market.Racal wanted to float the company, but now Sir Ernest Harrison, the company’s chairman (above), is believed to be looking for a trade sale.. Mr Cavallo is credited with defeating Argentina’s hyperinflation.Mr Cavallo, a Harvard-trained economist and contender in presidential elections next year, told La Nacion newspaper he would have to speak to members of Russia’s government before recommending any solutions.Asked if he would suggest a convertibility plan like the one he introduced in Argentina in 1991, Mr Cavallo said: “For me, it is key to have a solid and trustworthy currency.”.