What's a forest worth?

SUBHEAD: When we fail to measure the economic value of nature, we treat it as expendable.

By Laurie Mazur on 4 March 3016 for Mongabay -
(http://news.mongabay.com/2016/02/whats-that-forest-worth-disaster-assistance-finally-takes-nature-into-account/)


Image above: A Rim Fire in the Stanislaus National Forest in California that began on Aug. 17, 2013. Photo by U.S. Forest Service. from original article.

• A backyard shed gets destroyed by fire, that’s a $2,000 loss. But when 77,000 acres of Yosemite National Park are reduced to smoking embers? Nada.
  
• It was only after calculating the dollar value of the forests destroyed by a 400-square mile swath of California near Yosemite in 2013 that Governor Jerry Brown was able to secure federal funds to help the state and its residents cope with the loss.
  
• Fast forward to 2016, when the U.S. Department of Housing and Urban Development (HUD) awarded $1 billion to 13 communities through the National Disaster Resilience Competition — and actually required applicants to calculate the value of nature and other non-traditional benefits in their proposals.

 If a tree falls in the forest, what does it cost?

From the perspective of federal disaster assistance, the answer traditionally has been “not much.” But now — thanks to improved number-crunching — the federal government is taking nature into account when it tallies the cost of disasters.

And, even more importantly, it is recognizing the value of nature — forests, wetlands, parks — in preventing or mitigating disasters.

Remember the Rim Fire, which incinerated a 400-square mile swath of California near Yosemite in 2013? When the state of California first asked the Federal Emergency Management Agency (FEMA) for a “major disaster” declaration, it was turned down. Why? Because most of the damage was inflicted on forests, rather than man-made structures — and there was no way to put a price-tag on that loss.

Just think: a backyard shed gets destroyed by fire, that’s a $2,000 loss.

But when 77,000 acres of Yosemite National Park are reduced to smoking embers? Nada.
Enter Earth Economics, an independent non-profit that helps decision makers assess the financial value of natural systems. The group’s economists looked at the services the forest provided — filtering drinking water for the City of San Francisco, preventing floods, sequestering carbon, providing recreational opportunities — and calculated the dollar value of what was destroyed by the fire.

Armed with those numbers, Governor Brown appealed FEMA’s decision — and won.

Fast forward to 2016. The once-radical notion of valuing nature’s services is now more widely accepted by the federal government. Recently, the U.S. Department of Housing and Urban Development (HUD) awarded $1 billion to 13 communities through the National Disaster Resilience Competition (NDRC) — and actually required applicants to calculate the value of nature and other non-traditional benefits in their proposals.

The competition asked applicants to use a holistic benefit-cost analysis developed by Earth Economics with support from The Kresge Foundation, which incorporates natural ecosystems’ value and services, long-term environmental sustainability, and community benefits such as health and employment. Earth Economics provided training, tools, and resources throughout the competition to help applicants calculate those values.

“The Earth Economics team helped us to capture the full range of benefits of the Community and Watershed Resilience Program, including the tremendous ecological benefits that it will provide not just to Tuolumne County, but to the State as a whole,” said Louise Bedsworth, Deputy Director of the California Governor’s Office of Planning and Research.

The winning proposals all make use of natural systems to build resilience to climate change impacts and other disasters. For example:

• A California county that was devastated by the Rim Fire received an NDRC grant to restore the health of its forests and watershed, generate energy and support the rural community.
• Lower Manhattan, which was inundated by Superstorm Sandy, got funding to construct a coastal protection system that includes much-needed green space.
• In Hurricane Katrina-pummeled New Orleans, the Gentilly neighborhood won a grant to restore coastal wetlands and build water-absorbing parks and green streets.

Recognizing the value of nature and other overlooked social and economic benefits simply drives better decision making, according to David Batker of Earth Economics, who helped coach a number of the NDRC’s winning applicants.

“Benefit-cost analysis that includes nature helps us make smarter investments at federal, state, and local levels,” said Batker. “We owe it to ourselves and future generations to use this tool to identify the best, most robust and resilient investments.”

Indeed, investing in nature produces a bigger bang for the buck. For example, on a good day, the Lower Manhattan greenway is a park and bike path; on a bad day, it protects the city by absorbing potentially deadly storm surges. That is more than you can say for most single-purpose “gray” infrastructure, such as concrete levees.

Investing in natural infrastructure is a good way to get the most from taxpayers’ money, says Harriet Tregoning, Principal Deputy Assistant Secretary for HUD’s Office of Community Planning and Development.

“We are learning together about how to encourage a broader range of benefits from every federal dollar that gets expended,” Tregoning said during an announcement of the NDRC winners.
Valuing nature may seem like a no-brainer to many; the majestic forests of Yosemite obviously have tremendous value. But, too often, our public policies are structured by rules developed back when natural resources seemed inexhaustible. As the economists say, “you get what you measure.”

When we fail to measure the economic value of nature, we treat it as expendable. That is why the United States — one of the most resource-rich countries in the world — is now running an ecological deficit, according to the Global Footprint Network.

So, nature counts for more than pretty postcards and vacations. New tools to measure the dollars-and-cents impact of nature help planners, officials and taxpayers make the wisest choices for both the planet’s people and the natural systems that support them.

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Kukuiula Ghost Town

SUBHEAD: How a development on Kauai, planned for rich people, became a ghost town.

 By Shawn Langois on 27 September 2011 for Market Watch - 
(http://www.marketwatch.com/story/real-estate-slump-hits-luxury-hawaiian-resort-2011-09-27)

 
Image above: The clubhouse at Kukui’ula, an ocean-view golf course and residential real-estate development on Kauai, Hawaii. From original article.

Ambling into the warm embrace of Kukui’ula’s clubhouse on Kauai’s pristine south shore is to catch a fleeting glimpse into how the other half lives.

Or, more accurately, the other 0.1%. But with the global economy in turmoil and real-estate wounds still festering across the country, there’s trouble in paradise. “We broke ground on the club in 2008 and a month later, Lehman Brothers went down,” said Brent Herrington, Kukui’ula president. “There was a moment there where it felt like the world was going to end,” he said. “But we came together as a partnership and decided to push ahead.” Without a doubt, the expansive 1,000-acre development cutting a vast swath of land across Poipu is mesmerizing. A golf course with sweeping ocean views, a world-class spa, a cascade of pools, a stunning $100-million clubhouse. The ice cubes even match the drink order. What the customer wants, the customer gets.

The draw was compelling enough to attract New Orleans Saints quarterback and Super Bowl MVP Drew Brees to the club’s early membership ranks. His locker is prominently displayed inside the men’s locker room. The staff quips, “Would you like to use Mr. Brees’s bench?” Then why does the resort feel like a vacant city-scape scene out of a zombie flick? While every corner of the property is equipped for a good time, there’s hardly anyone there to enjoy it. At least for now.  

One sale in a year-and-a-half
“I’m still a big believer in the property, and the people that bought for their own use are very happy,” said Becky Supon, Pacific Ocean Properties real-estate agent and former saleswoman at Kukui’ula. “The ones looking to flip for profit, of course, aren’t happy.” Supon said she currently has eight listings from clients trying to unload their property. One customer who bought during the initial sales phase for $1 million just sold his piece of land for about $550,000. “It’s one of the most unique and beautiful developments in all of Hawaii,” Supon added. “But it’s just tough to market it right now and banks aren’t really loaning on second homes.”

It’s not that Alexander & Baldwin (NYSE:ALEX) , who first began zoning the project some 25 years ago, and partner DMB Associates, a renowned golf-community developer from Arizona, aren’t offering up a stellar product. They are. But the market for these kinds of things has been treacherous. All the palm trees and Lomi Lomi massages in the archipelago can’t change that. “The most recent down cycle was one of the worst we’ve seen in Hawaii,” said Honolulu-based real-estate analyst Ricky Cassiday. “Sales have since recovered somewhat, and we are two years out from the bottom, but it is still anemic by historical standards.”

 Recognizing the futility in pushing sales during times as ugly as the past few years, the developers behind Kukui’ula decided to circle the wagons and stop spending on marketing. Of course, while it appears to have been the right move, it also kept a lid on demand. Only one piece of land has sold in the past year-and-a-half after 80 “founder” lots were sold in 2006 for a total of $110 million. Eventually, the project plans to offer a series of price points. On the low end, condos will be available for under $1 million. On the high end, Herrington said he sees custom homes upwards of $20 million.

Cassiday points out that some of Kukui’ula’s best lots have yet to be marketed, which will come in handy when things pick up. “They can pull the ace from the hole any time they want. And at this point, everyone else is dying off,” he said, referring to several other projects in the Islands that have stalled or been halted altogether. “Kukui’ula has enough invested to be the last one standing, and that’s a good thing,” Cassiday said. “A&B and DMB have spent a ton of money here, but the value won’t go away — entitled land in a great place with high barriers to entry is good, especially long-term.”  

Riding out the cycles
Currently, cottages are being rolled out in the $2-million-plus range along with home sites costing between $1 million to $3 million. Then there’s the monthly club dues of $1,000, a required part of any purchase. With almost 90,000 acres, Alexander & Baldwin is one of Hawaii’s biggest landowners, and has been for more than a century. From its legacy sugar-cane business to its Matson Navigation shipping subsidiary, there’s much more to the company than real-estate development. But that doesn’t minimize the importance of Kukui’ula in the grand scheme of things at A&B. The company has already laid out $225 million in cash for its part of the joint venture.

To put that in perspective, A&B posted total revenue of $488.2 million in the most recent quarter, while profit dipped from a year ago to $18.7 million. “Kukui’ula is a significant investment for A&B ... one that we believe will generate tremendous long-term value,” said Chris Benjamin, president of A&B Properties. “The market is recovering, and we have an irreplaceable asset that will perform extremely well in the years ahead as there is no comparable new project in Hawaii, and we do not believe there will a comparable project in the foreseeable future.” Benjamin described Kukui’ula as a “long-life-cycle project,” comparing it to the company’s highly -successful Wailea resort in Maui, which was developed in the 1970s and 1980s. “What’s important is being able to ride through the cycles,” he added. “The project has no debt, and A&B has the ability to sustain the project and benefit greatly in the up cycles.”

Herrington, an employee from the DMB side of the venture, has helped turn some of company’s other high-profile projects into winners, and is quick to point out the overall reception during a recent marketing push has been positive. Yet buyers haven’t responded with open checkbooks. Why? The reasons are clear: It’s a hefty luxury expense during a relentless global downturn that has shown few signs of abating.

 Not budging on pricing
 Larry Leight, who sold his high-end Oliver Peoples sunglasses business to Luxottica Group’s (NYSE:LUX) Oakley subsidiary in 2006, owns a vacation home just down the road from Kukui’ula and has been wooed as a potential member. Watch video on Oliver Peoples.

 Impressed as he is, Leight is having a difficult time justifying that kind of financial commitment right now. “You just can’t find luxury at this level anywhere else, especially in a setting like this. Still, I don’t think we’ve seen the bottom in the market yet,” Leight said. “The current economic condition makes it difficult to purchase such a luxury today, though interest rates and pricing are getting better,” he added. “It might take a while, but I think the project will be a big success.” Pricing, however, is one thing on which Herrington and the top brass plan to stand firm. “We believe the market recovery is still two or three years out, and it could be even longer than that.

Nobody anticipated a downturn as deep and sustained as this one, but we’re prepared to be here,” Herrington said. “We are not going to have a fire sale. This is the last grand-scale luxury development in Hawaii in our lifetime. Maybe forever.” He preaches patience. And that seems to be just fine with those whose fortunes are linked to the project’s long-term success. Mick McGuire, a former analyst at hedge fund giant Pershing Square, is a believer. He now runs the Marcato Capital Management fund, which holds 551,881 shares of A&B while Pershing owns some 3.5 million shares, according to a recent SEC filing.

It doesn’t hurt that Alexander & Baldwin’s stock has rallied 7% in the past year to outpace a volatile stock market. It’s easier to be patient when shareholders are complacent and believe in the project. “It’s a wonderful property in one of the best and last remaining locations on one of the most beautiful Hawaiian islands and those unique characteristics translate into significant value,” McGuire said, adding that he sees “enormous development potential.” For now, much is riding on that potential because the reality is still brutal.

See also:
Ea O Ka Aina: End of Kauai's Economy 7/7/10
Island Breath: Kauai Lagoons - annuls of false advertising 3/18/08
Island Breath: Koloa Landing Scam Development 6/28/07
Island Breath: Koloa Area Development Moratorium 7/23/06
Island Breath: Slow Chaotic Development 5/10/06
Island Breath: Poipu to be buried in development 8 1/05
Island Breath: Kukui`ula to have negative impact on Southside 1/13/04

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Emotional Callousness

SUBHEAD:It's a self-Inflicted injury. Without feeling, there is neither information nor motivation.  

By Clifford Dean Scholz on 4 May 2011 in Green Hand Initiative - (http://greenhandinitiative.blogspot.com/2011/05/self-inflicted-injury-of-emotional.html)

 
Image above: Deputy Director of IMF (left) passing the homeless. From (http://www.thejournal.ie/imf-head-passes-three-homeless-on-way-to-bailout-talks-2010-11/).
 
I’m drinking a cup of coffee right now, having boiled the water with natural gas. I’m not exactly sure where the fuel I used comes from, but my guess is that natural gas from various sources gets marketed and distributed together. Therefore as I enjoy my coffee this morning, people in shale gas states now may have combustible household tap water and carcinogenic bathroom showers as a thank you for my convenience.

One of the hazards of environmental inquiry is to see horrors like this hiding behind pretty much everything I do and much of what I own, right down to the cotton socks on my feet. My question today is: How did I get to be so callous about it? And what should be done?

My most recent answer to the first part of this quandary is this:

• Step One is to see that I was born into a culture in which emotional callousness is a fundamental coping strategy.
• Step Two is to notice that approaches to solving the basic problems of living, which would be unthinkable if we were not so callous, are then baked into successive generations of technology, social norms, and institutions.
• Step Three (and it’s a short one) is seeing that it’s nearly impossible for an individual to live in a culture thus designed without also becoming callous.
• Step Four puts the whole thing on wheels: as conditions get worse and nearly every aspect of our culture holds in its shadow some kind of hell, the motivators are in place for yet more callousness leading to yet greater violations of sensibility in a self-reinforcing feedback loo

So that explains a lot about how we got where we are and why it’s so difficult to change: we’re living a callous morality, and we’re doing it on a global scale. Callous corporate ruthlessness has been part of the mix since these entities were first invented. Ships bearing cargoes of slaves, tea, and spices started the ball rolling, then coal, petroleum, tobacco and “unsafe-at-any-speed” car companies came to rule; when talking about profits before people, it’s nothing new. Callous government has been with us even longer than callous corporations. Consequently, as these entities have come to dominate our lives, we have in response become callous as well. What’s also becoming apparent is that there are consequences to this trend, and that they are serious ones.

“It’s the law of the jungle! It’s a matter of survival!” I hear.

Yes, this is true. Cultures that are ruthlessly efficient in extracting resources and developing weapons have overrun and exterminated all others.

And now, I would argue, that game has played out. The idea that power naturally accrues to those who are most ruthless and myopic in the pursuit of their own short term gain, and that this is the best way to run human society, is about to hit a wall.

In the long run, callousness and consciousness do not support one another. Although a certain toughness is required of everyone to meet the rigors of life, the tolerance for and even idealization of loss of feeling is not compatible with any sustainable form of human intelligence, since loss of feeling is a kind of loss of consciousness. Because of this, callousness and power are also ultimately at odds with one another.

The emotional callousness currently endemic on the global corporate and political scene, as well as in our consumer culture, works a bit like leprosy. Contrary to popular belief, leprosy does not cause limbs to fall off. What happens is that the disease attacks the nerves, resulting in a loss of feeling. Without the conscious feedback loop of feeling and physical sensation, nearly constant unintentional self-inflicted injuries result. Chronic infection and continuous scarring further the process, until disfigurement and deformity occur.

I would argue that emotional callousness does pretty much the same thing, and although the inner disfigurement is more easily hidden, at least among others who are similarly afflicted and who thus have difficulty feeling what’s going on, the consequences of it are visible everywhere. I believe we are fooling ourselves in the often unexamined belief that loss of the feeling sense and the inner connection to reality it can provide would have any better practical outcomes for effective action in the world than loss of physical sensation does for the human body.

Of course, an unfeeling approach seems to work so well at first. Then again, so perhaps does heroin. However, the complications that loss of feelings so efficiently eliminates are, in fact, information. Feelings are an irreplaceable mechanism for inner guidance and course correction. To the extent that we allow ourselves to become callous, we lose the holistic perspective feelings would otherwise provide. So, while emotional callousness can be compared to a kind of numbness, it also results in a kind of blindness. Either way, depending on the degree of the emotional impairment, nearly constant unintentional self-inflicted injuries result.

If my supposition is correct, it seems likely that the erosion and deformity of the emotional potential of humanity would generate other self-reinforcing feedback loops. On an individual level, disfiguring inner pain often results in further retraction from the feeling sense that would reveal its true nature and extent. The typical judgment is that it is simply too much. On aggregate, social pressures mount not to feel much, since one person’s emotions are likely to trigger and thus reveal another’s. Fortunately, we have the distractions, drugs, and prisons to handle it, or we wait until body systems fail under the stress and then treat the problem in the form of diseases. A rather reliable indicator of numbness is the level of stimulation required to generate a response. Here our culture seems to up the ante with every passing year.

News flash: Callousness, glamorized by many images in the media as strong and “macho,” is actually form of cowardice. To choose to be unfeeling on a consistent basis is to choose unconsciousness and death. When the people of a nation governed by democratic institutions embrace callousness as a coping strategy, that nation will be led by those who mirror this tendency. In time, and often rather quickly, leaders who embody callousness as an ideal will destroy their nations. The law of leprous self-inflicted injury will work systemically to debilitate the nation and its capacity to respond effectively to emerging conditions. This is exactly what we’re seeing. If we cannot change course at this moment, it is because not enough people can feel what’s going on. Without feeling, there is neither information nor motivation.

So, it’s not resource depletion, peak oil, climate change, rising population, corporatocracy or environmental devastation that will be the cause of our demise. Nor is the problem a political stalemate or the stranded costs of our investments in useless, outmoded or destructive technology. These are the not the problems, really: they are the symptoms.

Our callousness plays a causal role here, empowering all of these immanent threats to humanity. Change that and we start to change everything. And the beautiful thing is, we can change that. We can begin right now by bravely choosing a path of feeling, promoting values and institutions that are consistent with the development of feeling, loudly and clearly proclaiming ourselves to be people of feeling, and recognizing that being a person of feeling requires living a life of profound integrity.

In consequence, as I continue my inner work to open the doors to the deeply informative world of feeling, I must also for example begin to divest myself my participation in forms of agriculture that poison the land and abuse those who work it, and I must shift away from forms of transportation that ruin the air and pollute land and sea. The reason is, as I open those inner doorways, I feel my connection with all of these things. As incrementally as necessary and always compassionately, a person of feeling is required to connect precisely where the callous approach to living would disconnect. This is how we heal the planet by healing ourselves, and this is also the wellspring from which we will draw our strength, our inspiration, and our motivation to continue our work in the world.


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Demise of the Dollar

SUBHEAD: The Great Recession never left us and collapse of the industrial economy is already under way. By Guy McPherson on 22 February 2011 in Nature Bats Last - (http://guymcpherson.com/2011/02/demise-of-the-dollar) Image above: Illustration of hyperinflation by David Dees. From (http://www.rense.com/1.mpicons/deesA2.htm).

The U.S. dollar continues its journey from Brobdingnagian to Lilliputian stature, and the latest trade report is a prelude to the dollar as microbe. The Prime Mover in this case is King Ben, who has the helicopter on track for a one-way trip to Zimbabwe with every American along for the ride. Death of the world’s reserve currency “is irreversible, and it will unleash a cyclone of chaos and confusion that will leave many literally suspended in disbelief as the entire false paradigm most of humanity has lived under for their entire existence is washed away forever.” It’s not just a bunch of bloggers and pundits announcing the dollar’s funeral, either: Even the International Monetary Fund is discussing abandoning the U.S. dollar as the world’s reserve currency, which portends hyperinflation as surely as Benny and the Inkjets working overtime on the printing presses.

Already, the crushing of the consumer sector is under say even as the road to madness is paved with King Ben’s $100 bills. To his credit, Bernanke finally admitted that nearly every bank in the country almost failed shortly after the price of oil peaked in mid-2008. He failed to mention, however, that such an outcome surely would have terminated western civilization within a month.

Meanwhile, Ben and the boys at the Federal Reserve Bank keep launching new ships in the never-ending fleet of Quantitative Easing. QE II was intercepted by Wall Street on its way to Main Street, so QE III is on the way, undoubtedly destined for the same fate. Like a high-speed, head-on collision, QE III will have quite an impact, but only on those immediately involved. The rest of us will be rubber-necking and wondering what happened as we drive by.

Coincident with the death of the U.S. dollar, the industrial economy is perched on the brink of catastrophic collapse. Or, as I’ve written before, the Great Recession never left us and collapse of the industrial economy is already under way. Most people have simply not realized it yet because they haven’t been told by the media or the completely impotent federal government. Many signs point to 2012 as the year the ongoing collapse of the industrial economy reaches its overdue end, although I’m not yet giving up on 2011.

If you prefers charts to texts, try this set for an abbreviated version of the story. In other words, the Keynesian experiment has nearly run its course, so it’s time to get serious about feeding yourself and your community in the near future.

If you think revolution is restricted to other countries, take a look at the gap between the haves and the have-nots around the world. Inequality is far worse in the U.S. than Egypt, Tunisia, or Yemen: The American picture is truly ugly. Ongoing events in Middle Eastern countries, driven by economic factors, are the canaries in the coal mine of global economic collapse, as intimated by Dmitry Orlov and further explained by noted trends forecaster Gerald Celente. And if you think we wouldn’t use force on our own, then you haven’t checked with the troopers in Wisconsin.

Even as Middle Eastern puppets for the U.S. are falling like dominoes, despite continued U.S. support, it becomes increasingly clear Obama will be the president who asks the last mercenary to turn out the lights on American Empire. Collapse is proceeding apace, and even Congressional Representative Ron Paul admits the federal government is in the process of complete failure.

Crude oil underlies the entire industrial mess and CNBC admits we need those dictators puppets to keep the oil flowing to the U.S. as the major domestic source of oil in the U.S. continues to falter and past-peak, free-falling Saudi Arabia clings by a thin thread (as recognized by Foreign Policy). When the kingdom falls, it could well take the U.S. dollar with it, and quickly. And contrary to statements from our politicians, “we’re not worried about the rivers of blood — we’re worried about the rivers of oil” coming out of the Middle East. As we’ve been since the 1970s.

If you think we can pay our way out of this predicament, it’s time to pony up. If you pay taxes, you and your family owe more than $1 million en route to saving our monetary system. Small wonder, then, that Tim Geithner foresees imminent default on U.S. debt. Before we get there, Timmy is blackmailing Congress, claiming that failure to raise the debt limit leads to default. But Timmy knows default is right around the corner, either way.

Jeff Rubin explains why oil-price shocks induce recession, and also why there is a lag between the shock and the economic pain. Rubin and an ever-larger choir are joined by Jim Rogers and financier and author Stephen Leeb in the expanding club forecasting oil priced at $150 per barrel in the near term (and Global Research has joined the party, too). That’s what happens when the giant oil fields run dry.

Lest you run out and buy oil futures, bear in mind the other potential outcome to this globalized world: China’s economic bubble could burst in short order. When it does, only one bubble remains: the human population bubble on Earth.

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China & Russia Quiting Dollar

SUBHEAD: The two countries will now use only their own currencies for bilateral trade. Image above: Vladimir Putin and Wen Jiabao shake in currency trade deal. From article. By Su Qiang and Li Xiaokun on 24 November 2010 in China Daily - (http://www.chinadaily.com.cn/china/2010-11/24/content_11599087.ht)

China and Russia have decided to renounce the US dollar and resort to using their own currencies for bilateral trade, Premier Wen Jiabao and his Russian counterpart Vladimir Putin announced late on Tuesday. Chinese experts said the move reflected closer relations between Beijing and Moscow and is not aimed at challenging the dollar, but to protect their domestic economies.

"About trade settlement, we have decided to use our own currencies," Putin said at a joint news conference with Wen in St. Petersburg.

The two countries were accustomed to using other currencies, especially the dollar, for bilateral trade. Since the financial crisis, however, high-ranking officials on both sides began to explore other possibilities.

The yuan has now started trading against the Russian rouble in the Chinese interbank market, while the renminbi will soon be allowed to trade against the rouble in Russia, Putin said.

"That has forged an important step in bilateral trade and it is a result of the consolidated financial systems of world countries," he said.

Putin made his remarks after a meeting with Wen. They also officiated at a signing ceremony for 12 documents, including energy cooperation.

The documents covered cooperation on aviation, railroad construction, customs, protecting intellectual property, culture and a joint communique. Details of the documents have yet to be released.

Putin said one of the pacts between the two countries is about the purchase of two nuclear reactors from Russia by China's Tianwan nuclear power plant, the most advanced nuclear power complex in China.

Putin has called for boosting sales of natural resources - Russia's main export - to China, but price has proven to be a sticking point.

Russian Deputy Prime Minister Igor Sechin, who holds sway over Russia's energy sector, said following a meeting with Chinese representatives that Moscow and Beijing are unlikely to agree on the price of Russian gas supplies to China before the middle of next year.

Russia is looking for China to pay prices similar to those Russian gas giant Gazprom charges its European customers, but Beijing wants a discount. The two sides were about $100 per 1,000 cubic meters apart, according to Chinese officials last week.

Wen's trip follows Russian President Dmitry Medvedev's three-day visit to China in September, during which he and President Hu Jintao launched a cross-border pipeline linking the world's biggest energy producer with the largest energy consumer.

Wen said at the press conference that the partnership between Beijing and Moscow has "reached an unprecedented level" and pledged the two countries will "never become each other's enemy".

Over the past year, "our strategic cooperative partnership endured strenuous tests and reached an unprecedented level," Wen said, adding the two nations are now more confident and determined to defend their mutual interests.

"China will firmly follow the path of peaceful development and support the renaissance of Russia as a great power," he said.

"The modernization of China will not affect other countries' interests, while a solid and strong Sino-Russian relationship is in line with the fundamental interests of both countries."

Wen said Beijing is willing to boost cooperation with Moscow in Northeast Asia, Central Asia and the Asia-Pacific region, as well as in major international organizations and on mechanisms in pursuit of a "fair and reasonable new order" in international politics and the economy.

Sun Zhuangzhi, a senior researcher in Central Asian studies at the Chinese Academy of Social Sciences, said the new mode of trade settlement between China and Russia follows a global trend after the financial crisis exposed the faults of a dollar-dominated world financial system.

Pang Zhongying, who specializes in international politics at Renmin University of China, said the proposal is not challenging the dollar, but aimed at avoiding the risks the dollar represents.

Wen arrived in the northern Russian city on Monday evening for a regular meeting between Chinese and Russian heads of government.

He left St. Petersburg for Moscow late on Tuesday and is set to meet with Russian President Dmitry Medvedev on Wednesday.

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