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ST PETERSBURG (Reuters) - President Vladimir Putin tried on Thursday to warm up relations with foreign investors chilled by the crisis in Ukraine, but many senior executives snubbed him by boycotting a conference billed as Russia's answer to Davos.
The St Petersburg International Economic Forum has for years drawn global business leaders to the elegant former imperial capital on the shores of the Baltic Sea, and deals worth billions of dollars have been signed at it.
But not this year. Many chief executives have stayed away under pressure from the U.S. government, which said attendance would be "inappropriate" after Russia's annexation of Crimea and the imposition of U.S. and European Union sanctions on Moscow.
Putin is not due to show up until Friday, when he delivers the keynote speech. But he sent a telegram to delegates with two messages: Russia wants to do business with the West but it will not do so at any price - it must be treated as an equal partner.
"Russia is ready to broaden multi-faceted contacts with all partners on the basis of true equality and respect for one another's interests," he wrote as he made his way back from China after signing a landmark gas supply deal.
At the forum, Putin is likely to hold up the 30-year supply deal with Beijing as a sign to the West that it cannot isolate Russia globally because it has powerful allies in Asia.
But with Russia's economy tilting into recession and capital flight accelerating, an exodus by foreign investors would be a painful blow for Putin.
Although U.S. and European sanctions have so far targeted only a few dozen individuals and small firms, the overall chill and the threat of broader measures in future are having real economic consequences, Russian officials say.
"We sense and understand that the informal character of the pressure ... is all causing serious consequences for our economy," First Deputy Prime Minister Igor Shuvalov was quoted as saying by RIA news agency.
After a pro-Russian president was toppled in Ukraine in February, Putin triggered the biggest confrontation with the West since the Cold War by declaring the right to send troops.
Russia seized and annexed Ukraine's Crimea peninsula in March and has since then massed tens of thousands of troops on the frontier. Kiev and its Western allies say Moscow is behind an uprising in eastern Ukraine by armed separatists who have declared independence and called for Russian military support.
Ukraine will hold a presidential election on Sunday, and Washington and Brussels have threatened to impose much tougher sanctions if Moscow interferes with the vote.
Moscow has signaled it may not recognize the legitimacy of the next president but denies fomenting unrest in east Ukraine.
A new round of sanctions might hit the banking sector or the energy industry, a potentially heavy blow because oil and gas exports account for about 25 percent of Russia's gross domestic product. Russia is the world's largest oil producer and second largest producer of natural gas.
Sanctions are bad for business, and many Western firms have lobbied against them, especially in Europe which does more than 10 times as much trade with Russia as the United States does.
"Total has always been very clear: we don't think sanctions are improving anything," said Christophe de Margerie, CEO of French oil company Total (TOTF.PA). Senior oil executives are expected to meet Putin, as usual, on the sidelines of the forum.
Still, top executives of some Western companies are keen not to be seen as too cosy to Russia at a time when their governments are so strongly at odds with Moscow, especially Americans explicitly warned away by the White House.
Executives who stayed away from St Petersburg include the heads of Exxon Mobil (XOM.N), Citi (C.N), PepsiCo (PEP.N) and Goldman Sachs (GS.N), although those companies sent other representatives in their bosses' places.
The name of British Petroleum's (BP.L) boss, Bob Dudley, disappeared from the list of speakers at the last minute. A BP official denied he had ever planned to speak.
A confidential email sent to loyal and state-run media, which was seen by Reuters, advised Russian news organisations to play down the absence of foreign executives and highlight the growing number of Asian businessmen attending.
"The Western world is no longer an absolute leader, which can dictate its rules to everyone else. The epicentre of the global economic activity is increasingly shifting towards Asia-Pacific," the Kremlin email said.
Additional reporting by Dmitry Zhdannikov, Lidia Kelly, Steve Gutterman, Thomas Grove, Katya Golubkova, Denis Pinchuk, Oksana Kobzeva, Vladimir Soldatkin and Maria Kiselyova; Editing by Peter Graff