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Athens News Agency: News in English (AM), 98-02-24

Athens News Agency: News in English Directory - Previous Article - Next Article

From: The Athens News Agency at <>


Athens, Greece, 24/02/1998 (ANA)


  • Greece hails UN-Iraq agreement
  • Gov't expresses confidence in the drachma
  • Pangalos criticises Turkey-Israel military ties
  • US State Dept's Miller on Pangalos' proposal to Ankara
  • Kranidiotis in Nicosia for talks
  • London exhibition on Byzantium
  • Access to Acropolis blocked tomorrow by strikers
  • IOBE study on viability of social insurance system
  • Greek stocks plunge on fears of lower national credit rating
  • Gov't seeks to ease mutual fund jitters
  • Greek population shows minor decline
  • Gov't measures for employment
  • Weather
  • Foreign exchange


Greece hails UN-Iraq agreement

Athens views the agreement over weapons inspections reached between UN Secretary General Kofi Annan and the Iraqi leadership in Baghdad as a "positive development", government spokesman Dimitris Reppas said yesterday.

He also noted Greece's efforts to ensure that all avenues were explored in order to avoid an outbreak of war.

Alternate Foreign Minister George Papandreou said efforts by Mr. Annan in Iraq were successful, adding that the European Union's Council of Foreign Ministers was very satisfied with the signing of the agreement for a diplomatic solution to the crisis in Iraq.

Mr. Papandreou said although the Olympic truce cannot be considered the main factor of whatever diplomatic success, it was one of the factors contributing to the extension of negotiating time, since the winter Olympic Games in Nagano were underway.

Gov't expresses confidence in the drachma

Government spokesman Dimitris Reppas yesterday said he was optimistic that monetary authorities would again be able to foil speculative attacks on the drachma, after the Bank of Greece intervened repeatedly in money markets in order to stabilise the curre ncy's parity.

The spokesman stressed that the government's policy on the drachma would remain firm and was already bearing fruit.

Markets were hit by Friday's news that the Moody's credit rating firm was considering lowering Greece's credit rating, now standing at A2 for domestic paper and Baa1 for external debt. Nevertheless, market reaction was described as generally reserved, with bankers reporting capital outflows totalling 230 million Ecus at the drachma's daily fixing - a sum considered to be within reasonable limits.

The Greek currency fell 0.16 per cent against the Ecu. It was 0.14 per cent off against the deutschmark but stable against the US dollar. Interbank rates remained steady around Friday's levels at 17.5 per cent.

Generally, the impression among market analysts was that fears about the drachma had been considerably exaggerated and that new speculation about a devaluation was baseless, particularly when it was not certain that Moody's would in the end proceed to reconsider the country's credit rating.The analysts were also pointing out that the firm has downgraded the country's credit rating before, shortly before a speculative run on the drachma in May 1994, from Baa1 to Baa3, only to raise it again to its former level later. The Greek economy's indicators have improved rather than worsened since, they added.

The Greek government is about to sign a $1 billion intenational syndicated loan soon, and government sources consider that the interest rate to be agreed upon will prove that its creditworthiness has not been hit. They add that the policy of the stable drachma will continue, even at the cost of high interest rates, and the national economy ministry considers tha the 1998 budget can absorb -mainly through the planned privatisations of public utilities- any additional cost arising from higher rates in t he interbank market and state paper.

Pangalos criticises Turkey-Israel military ties

Foreign Minister Theodoros Pangalos criticised Turkish-Israeli military ties yesterday and said they represented "an alliance of wrongdoers".

"Turkey's ties with Israel are not simply just for exercises as some people pretend," Mr. Pangalos told reporters in Cairo after meeting Egyptian President Hosni Mubarak. "We very well know that this is a strategic alliance and that it is the wrong kind for everybody. This is an alliance of wrongdoers that brings us to a Cold War situation. It is not in keeping with contemporary times," he added.

Israel and Turkey held their first joint naval exercises in the east Mediterranean in January. The United States also took part in the manoeuvres which are part of a 1996 military agreement between Turkey and the Jewish state.

Many Arab states, chiefly Egypt and Turkey's neighbour Syria, criticised the manoeuvres, which Turkey and Israel said were only for search and rescue.

Mr. Pangalos said he shared Arab fears that the exercises could be directed against a Mediterranean or Middle Eastern state.

"These exercises are not simply meant to save people from the sea in an accident," he added.

Mr. Pangalos, who arrived in Egypt on Sunday on a three-day visit, said he discussed regional affairs and growing Egyptian-Greek military ties with Mubarak.

He also met Egyptian Foreign Minister Amr Moussa yesterday for more talks on facilitating an Egyptian cooperation agreement with the European Union.

The agreement is held up by EU tariff barriers on Egyptian farm produce, the area in which Cairo says it holds a comparative advantage.

US State Dept's Miller on Pangalos' proposal to Ankara

Special US State Department coordinator for the Cyprus issue Thomas Miller yesterday said the US considers Foreign Minister Theodoros Pangalos' recent proposal to Ankara as "positive and creative."

In an interview published in the Turkish daily "Milliyet" earlier in the month, Mr. Pangalos proposed that Turkey accept the jurisdiction of the International Court at The Hague for any claims it had in the Aegean.

Mr. Miller also said the US regarded Turkish Foreign Minister Ismail Cem's five-point proposal towards Greece as very interesting and could be termed as an answer to Mr. Pangalos' proposal.

Kranidiotis in Nicosia for talks

Foreign Undersecretary Yiannos Kranidiotis leaves for Cyprus today on a six- day visit to discuss President Glafcos Clerides' visit to Athens next month.

Mr. Clerides is due in the Greek capital on March 10.

Mr. Kranidiotis will discuss the president's forthcoming visit, as well as matters regarding Cyprus' accession course to the European Union and the participation of Turkish Cypriots in membership talks.

Tomorrow, Mr. Kranidiotis will meet with President Clerides, Foreign Minister Ioannis Kasoulides and House President Spyros Kyprianou.

During his six-day visit, Mr. Kranidiotis will also meet political party leaders, the primate of the Church of Cyprus Archbishop Chrysostomos and the commander of the National Guard.

He will have talks with Britain's representative for Cyprus Sir David Hannay, who will be visiting the island, US ambassador Kenneth Brill as well as EU special envoy to the Middle East Miguel Moratinos.

London exhibition on Byzantium

A exhibition on Byzantium showcasing coins and photographic materials will open Friday in London as part of the "Greece in Britain" series of cultural events.

The exhibition focuses on the travels to the east and west by Emmanuel II Paleologos, the father of last Byzantine Emperor Constantinos XI Paleologos. It will be housed at London's Greek Cultural Centre.

In addition, a concert at St. Paul's Anglican Church, under the auspices of the Ecumenical Patriarchate, is scheduled for March 4.

Access to Acropolis blocked tomorrow by strikers

The federation of culture ministry employees (POSYPPO) will block access to the Acropolis tomorrow in protest to a decision by Culture Minister Evangelos Venizelos to transfer five employees from the site to other posts.

The federation announced that the archaeological site will be blocked from 10:30 a.m. to 2:30 p.m.

In a written statement, POSYPPO also hinted that the transfers were connected to what it claimed were restoration work contracts on the Acropolis monuments by private consulting firms.

IOBE study on viability of social insurance system

The Foundation for Economic and Industrial Research (IOBE) yesterday presented a study entitled the "Future of the Social Insurance System in Greece."

One of its authors, researcher Nikos Leandros, said Greece's insurance system is currently deadlocked and is not viable in the long run. He predicted 2005 as the year of its collapse.

The main factors considered responsible for the crisis, according to the study, are the demographic factor and the swelling of the debts owed by funds which can be estimated at 200 per cent of GDP.

Mr. Leandros supports a change of the system with a new twin-pylon status. The first will be compulsory for a main pension and will have a distributive character and tripartite funding. The second will also be compulsory for an auxiliary pension and will have a capitalising character and will be funded by both the employee and the employer.

The premier's adviser, Platon Tinios, also made an address during the presentation, appearing to support Chile's so-called trizonal system, adding that it has been implemented by other countries such as Argentina, Bolivia, Mexico, Colombia and Peru.

Greek stocks plunge on fears of lower national credit rating

Greek equities ended sharply lower off the day's lows on the Athens Stock Exchange yesterday, hit by news that the US credit rating agency Moody's intended to downgrade the country's credit rating.

The general index broke the 1,400 support barrier to end at 1,393.46 points, off 2.44 percent. It was 5.0 percent down at the start of the session.

Sector indices lost substantial ground. Banks dropped 3.02 percent, Insurance fell 1.25 percent, Investment eased 1.04 percent, Leasing plunged 4.39 percent, Construction ended 3.46 percent off, Industrials fell 2.10 percent, Miscellaneous ended 1.52 pe rcent down and Holding fell 1.38 percent.

The parallel market index, however, ended 0.50 percent higher reflecting an appetite for smaller issues with greater profit potential.

Trading was heavy with turnover at 19.3 billion drachmas.

Broadly, decliners led advancers by 161 to 38 with another 28 issues unchanged.

Kambas, Elfico, Eskimo and Ergas scored the biggest percentage gains, while Papoutsanis, Aemet, Bank of Athens and Constantinidis suffered the heaviest losses.

National Bank of Greece ended at 20,120 drachmas, Ergobank at 13,850, Alpha Credit Bank at 14,790, Delta Dairy at 2,760, Titan Cement at 12,915, Intracom at 14,440 and Hellenic Telecommunications Organisation at 5, 350.

The Bank of Greece intervened repeatedly in money markets in order to stabilise the drachma's parity. Markets were hit by Friday's news that Moody's was considering lowering the country's credit rating from A2 for domestic paper and from Baa1 for foreign debt. Bankers reported capital outflows totalling 230 million Ecus at the drachma's daily fixing.

The Greek currency fell 0.16 percent against the Ecu. It was 0.14 percent off against the DMark but stable against the US dollar.

Interbank rates remained steady around Friday's levels at 17.5 percent.

Gov't seeks to ease mutual fund jitters

A senior Greek government official yesterday sought to reassure edgy markets that no crisis existed in mutual funds in the wake of liquidations in state paper last week.

"There is no reason for concern about mutual funds," national economy ministry secretary general G. Papaioannou told a gathering to review the Athens' bourse's performance in 1994-1997.

"Certain positions in state paper were liquidated recently. This was simply a reverberation of turmoil in previous weeks and not a signal of some so- called turmoil in the offing.

"Investors must realise that state paper enjoys a high level of confidence and will continue to do so. These are investments that have safe and attractive returns," Mr. Papaioannou said.

Greek population shows minor decline

Greece's population is basically stagnant with a slight downward push, the European Union's statistics service said.

In 1997 births were 98,200 and deaths 98,700, showing a drop in population of around 500 people.

Births were down 3.3 percent against 1996 and deaths were 1.8 percent lower.

The largest demographic decline in the EU was in Germany and in Italy (-0.5 percent), and the largest rise in Ireland (+0.5 percent).

The European Union's average was up 0.09 percent in 1997.

Gov't measures for employment

Labour Undersecretary Christos Protopapas yesterday announced measures for support to the unemployed during an event focusing on "unemployment and the policies of employment in Greece."

Mr. Protopapas said the government's main goal is to promote a bill on the "adjustment and regulation" of work relations, within the context of collective bargaining agreements and the pace of inflation along with the rate of productivity.

The 12 points of the government's programme include: - Economic restructuring programmes and measures for public utilities and enterprises (DEKOs).

  • Changes on development legislation.
  • A two-year agreement-framework for wage increases equal to inflation and the rate of productivity.
  • Changes in the system of continuing employee education-training.
  • Programmes funded by both the European Union and the Manpower Employment Organisation (OAED).
  • Restructuring of OAED and initiation of an "Employee Card" system.
  • A bill for changing work relations.
  • Protection against wholesale layoffs
  • Measures for areas with high unemployment.
  • Equal employment opportunities for men and women.
  • Measures against social disenfranchment.
  • Registration/legalisation of illegal immigrants Mr. Protopapas said that if changes do not succeed then fear of "blind social explosions" will be justified.


    Almost fine weather is forecast for most parts of Greece today with the possibility of local rain in the west in the afternoon. Fog in some areas in the morning. Winds light, turning to moderate in the Ionian Sea. Scattered clouds in Athens with temperatures between 7-20C. Similar weather in Thessaloniki with temperatures from 5-17C.


    Monday's closing rates - buying US dlr. 284.942 Pound sterling 466.478 Cyprus pd 534.093 French franc 46.822 Swiss franc 194.154 German mark 156.974 Italian lira (100) 15.915 Yen (100) 221.345 Canadian dlr. 200.543 Australian dlr. 189.715 Irish Punt 390.531 Belgian franc 7.607 Finnish mark 51.737 Dutch guilder 139.297 Danish kr. 41.190 Swedish kr. 35.321 Norwegian kr. 37.498 Austrian sch. 22.318 Spanish peseta 1.854 Port. Escudo 1.534


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