Athens News Agency: News in English (PM), 97-09-09

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From: The Athens News Agency at <http://www.ana.gr>

NEWS IN ENGLISH

Athens, Greece, 09/09/1997 (ANA)

MAIN HEADLINES

• Athens condemns new Dini statements
• August inflation up slightly
• Greek stocks still driven by Olympics euphoria
• Greece, Ukraine sign trade, investments pact
• Greek firms interested in Balkan road projects
• Greece warns Turkey over Bosporus Straits
• Games focus turns to organisational framework
• Government considering 2004 committee's composition
• Olympics to give Greek economy shot of adrenalin
• Weather
• Foreign exchange

NEWS IN DETAIL

Athens today responded to statements by Italy's foreign minister on the existence of "two entities and two governments" in Cyprus on a visit to Washington yesterday, saying they had been made for reasons of "expediency".

"The European Union has a policy on the issue (of Cyprus) which has been expressed officially by the president of the Council of Ministers Jacques Poos," government spokesman Dimitris Reppas said

"The European Union has not discussed any other proposal, the political position on the Cyprus issue has been taken unanimously, is being implemented and will brook no change," Reppas said.

According to a Cyprus News Agency dispatch from Washington today, Lamberto Dini, speaking to the press on Monday prior to a meeting with US Secretary of State Madeleine Albright, said there are "two governments, two entities and borderlines" in Cyprus.

Asked by a Turkish journalist if the part of Cyprus occupied by Turkey since its 1974 invasion of the island needs to be recognised as an "independent state", Dini replied he had never said such a thing.

"But I think it has to be recognised that there are two entities in Cyprus, " noting "if there were not two entities there would not be negotiations... for a federated state. This is the point I made," the Italian minister added.

Asked to say whether the "two entities are equal", Dini replied: "No, I wouldn't say equal entities. There are two entities. They exist, they co- exist. There are borderlines and two different governments and that is a state of fact."

Athens and Nicosia strongly protested statements by Dini in Rome last month after a meeting with his Turkish counterpart Ismail Cem, that "there are two republics, two governments and two entities in Cyprus".

Repeated statements by both the Prime Minister of Italy, Romano Prodi and the country's foreign ministry said Dini's statements were misrepresented by the media and that Italy recognises only the Republic of Cyprus and that a Cyprus solution should be based on UN resolutions.

Only Turkey recognises the illegal regime, unilaterally set up in November 1983, and the UN itself has called on all states not to recognise the self- styled entity and "not to facilitate or in any way assist the aforesaid secessionist entity."

August inflation up slightly

Greek consumer price inflation accelerated to 5.6 percent year-on-year in August from 5.4 percent the previous month, reflecting rises in energy prices, housing, fruits and dairy produce.

The National Statistics Service (NSS) said that electricity and petrol prices burdened the consumer price index by 0.07 percent and 0.8 percent respectively.

Consumer price inflation was 8.0 percent in August 1996.

NSS said it expected the inflation rate to ease in September.

Government spokesman Dimitris Reppas admitted there was a slight deviation from this year's inflation target but stressed it was a temporary phenomenon.

Greek stocks still driven by Olympics euphoria

Greek equities gained further ground on Tuesday but the pace of advance was considerably slower than in the previous session when the market surged 7.96 percent on euphoria that Athens was voted host of the 2004 Olympics.

The value of transactions, however, shot up to set a new 1997 record. Turnover was 66.1 billion drachmas.

The general index closed 1.49 percent higher at 1,688.51 points, sharply down from the day's highs. The index jumped 7.33 percent during the first hour of the session but eased back on profit-taking.

Most sector indices scored gains. Banks rose 1.47 percent, Leasing was 0.80 percent higher, Investment increased 1.11 percent, Industrials were 2.05 percent up, Construction jumped 6.40 percent, Holding was 0.18 percent higher, but Insurance and Miscellaneous fell by 0.08 and 2.73 percent.

The parallel market index for small cap companies eased 0.79 percent.

Broadly, advancers led decliners by 112 to 107 with another 11 issues unchanged.

Edrasis, Bank of Athens, Mechaniki, Attikat, Aktor, Aegek and Sarandopoulos scored the biggest percentage gains, while Babyland, Rilken, Xylemporia and Macedonian Plastics suffered the heaviest losses.

National Bank of Greece ended at 36,500 drachmas, Ergobank at 18,300, Alpha Credit Bank at 20,700, Delta Dairy at 4,185, Titan Cement at 16,005, Intracom at 13,400 and Hellenic Telecommunications Organisation at 7, 040.

Government spokesman Dimitris Reppas urged investors to remain calm and said that the government would pursue the same economic policies regardless of the fact that Athens had been awarded the 2004 Olympic Games.

Greece, Ukraine sign trade, investments pact

Greece and Ukraine have signed an agreement to boost trade and investments between the two countries.

Under the terms of the agreement, which was signed on Monday on the sidelines of the Thessaloniki international trade fair, businesses will have access to practical aid and information on investments and trade.

In addition, trade fairs, conferences and seminars will be held to promote economic ties between the two countries.

Also covering cooperation in the arts, the memorandum was signed by representatives of Ukraine's foreign economic affairs and commerce ministry, the Greek-Ukraine Association, and Greece's state trade fair organiser, Helexpo.

Greek firms interested in Balkan road projects

A consortium of five Greek construction companies has expressed interest in the construction of a road beginning in the Federal Yugoslav Republic and ending in Thessaloniki, according to Yugoslav Public Works Minister Benuslav Ivkovic.

The project, budgeted at 650 million dollars, will be tendered by the end of 1997 and awarded by March, 1998.

Ivkovic was speaking at a conference on the sidelines of the Thessaloniki International Fair on the "Technical projects: prospects for cooperation in the new markets of southeastern Europe".

Greece's Environment, Town Planning and Public Works Undersecretary Christos Verelis told the ANA that a number of bilateral contacts during the meeting would lead in the immediate future to the signing of cooperation agreements with the foreign ministry.

Earlier, representatives from the Former Yugoslav Republic of Macedonia (FYROM), Bulgaria and Albania had presented their countries' proposals for "corridor 8", extending from Durres in the west through Tirana, Skopje, Sofia and Plovidv to end at the Black Sea ports of Burgas and Varna.

Representatives said the project, dubbed by Athens as the 'para-Egnatia', had yet to receive full financing commitments.

The European Investment Bank has approved funding of 24 million Ecu for the Durres-Tirana section.

Ivkovic said the project was "pointless", doubting that it would ever be constructed and that it would take such a long time that it would not affect the construction of the Egnatia Highway, planned to run from the Greek port of Igoumenitsa to the Greek town of Alexandroupolis, on the border with Turkey.

Foreign companies expressed interest in road projects in the Balkans and particularly in those that will connect central Europe and Russia with southeastern Europe through the Egnatia highway and eventually become a part of the wider Trans-European road network.

Greece warns Turkey over Bosporus Straits

Athens will raise the issue of demilitarising the Bosporus Straits if Turkey persists in its threat to take Greece to the International Court of Justice at The Hague over the demilitarisation of the eastern Aegean islands, National Defence Minister Akis Tsohatzopoulos warned yesterday.

Mr. Tsohatzopoulos was responding to statements on Sunday by Turkish Foreign Minister Ismail Cem, who rejected a European Union proposal to take its differences with Greece to The Hague over Ankara dispute of Greek sovereignty over the islet of Imia.

Mr. Cem said instead, that Turkey would raise the issue of demilitarising the Greek islands in the eastern Aegean.

Speaking at the Hellenic American Chamber of Commerce, Mr. Tsohatzopoulos said: "It would be best for Ankara not to touch the issue of demilitarisation, because it would be very easy (for us) to bring the issue of demilitarising the (Bosporus) Straits t o the negotiating table, and the Turks know very well how very interested foreign powers are on this issue, following illicit actions and the checks conducted by Turkish authorities on foreign vessels passing through the Bosporus".

Referring to peace and security in the greater area, the defence minister criticised Turkey for what he said was the undermining of regional security institutions promoted by the international community.

Games focus turns to organisational framework

The committee that will handle the organising of the Olympic Games of 2004 will be ready within two months at most, and following approval by the prime minister, Sports Undersecretary Andreas Fouras said yesterday.

Sources said late yesterday that Prime Minister Costas Simitis has received a proposal for the establishment of an Olympic Games undersecretariat, which will have the general responsibility for the 2004 event.

Speaking to reporters earlier in the day, Mr. Fouras described what had to be done in the near future for the Games, and expressed appreciation for all those who had helped promote the success of Athens' bid.

Mr. Fouras said an agency to handle the organisation of the Games, which Athens won on Saturday by decision of the International Olympic Committee (IOC), would be set up following meetings with Mr. Simitis.

The "institutional framework, and all bodies will be set up within one or two months," Mr. Fouras said, adding that "there will be a legal framework to provide the ability of minute supervision of the Games, guaranteeing transparency."

The other factor that helped the bid was "unity from all sides. I personally will castigate anybody who tries to break up this unity in the future," he said.

According to Mr. Fouras, IOC President Juan Antonio Samaranch had told him during his visit for the opening of the World Athletics Championships last month in Athens that "I am anxious about whether I shall be able to come to Greece again if you do not win the Olympic Games. Your greatest asset is the success of the opening ceremony for the championships".

Mr. Samaranch was re-elected to the presidency of the IOC during its weekend meeting on the bid for the 2004 Games.

Government considering 2004 committee's composition

The government will soon take its decision on the operation and appointments to the organising committee for the Games, government spokesman Dimitris Reppas said yesterday.

Mr. Reppas said the decisions would take into account the positive work of the Athens 2004 bid committee.

The organising committee, he added, would take the form of a societe anonyme (S.A.) and would place emphasis on transparent procedures.

Projects not directly connected to the Olympics, he added, would continue on the basis of the prevailing "effective, positive and satisfactory" legal framework. On his part, Alternate Foreign Minister George Papandreou yesterday said the "Santer package" of European Union-related aid should not be linked to the 2004 Olympic Games.

Replying to a press question on whether the European Union will be more favourable towards supporting Greece in order to secure the success of the 2004 Olympics, Mr. Papandreou said:

"The projects which we have scheduled are necessary for our country, whether or not we were awarded the Olympic Games. And this was one of the arguments which we had repeatedly used for the members of the International Olympic Committee (IOC). Therefore , I would not link the Santer package to the Games. "I would not link it directly. Indirectly, of course, it has a relationship because the (Athens) metro, the (Spata) airport and the Stavros-Elefsina-Spata motorway are projects which are essential for t he Olympics. The EU, one way or another, has accepted to fund them. And they are not related to the Olympic Games."

Olympics to give Greek economy shot of adrenalin

The Olympic Games will have multiple benefits for the Greek economy due to an anticipated large inflow of capital to vital sectors, a trend likely to speed up the advance of many companies listed on the Greek stock market, analysts said.

Economists expect the turnover of Greek industrial groups to reach 550 million dollars in the period 2000-2004 and cite the speed up of major infrastructure projects as the main impact of the award to Athens of the 2004 Olympics.

The construction sector will see 800 billion drachmas of new projects, according to earlier estimates.

Also, information technology projects associated with the Olympic Games are expected to exceed 50 billion drachmas, with the Hellenic Telecommunications Organisation due to play a leading role in the sector. The partly privatised state telecom has alrea dy announced a 1.2 trillion drachma development programme.

Meanwhile, market analysts expressed their satisfaction at the market's reaction to the news Athens will host the Olympic Games, predicting a steady upward trend in the long-term with minor corrections.

WEATHER

FOREIGN EXCHANGE

(M.P.)

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