Athens News Agency: News in English (AM), 98-03-12

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

NEWS IN ENGLISH

Athens, Greece, 12/03/1998 (ANA)

MAIN HEADLINES

• Simitis rejects Ankara's proposal for unconditional dialogue
• Positive estimates over course of Greek economy
• Britain emphasises commitment to Cyprus' EU accession talks
• Greek-American leaders meet in Washington
• Karamanlis calls for transparency in police promotions
• Yiannopoulos says gov't prepared to move prisons from cities
• Karamanlis undergoes leg surgery
• Greece says its coastal fleet maintains high world standards
• Gov't tax revenues rise 18.15 pct in Jan-Feb.
• Gov't to keep civil servants' tenure intact
• Greek stocks climb again on falling interest rates
• Gov't to install Thessaloniki airport radar despite protests
• Greece to launch pilot Skopje-Thessaloniki rail link
• Allianz to insure Greek building projects
• Public works credits
• Weather
• Foreign exchange

NEWS IN DETAIL

Prime Minister Costas Simitis yesterday rejected Turkey's proposals for unconditional dialogue on all issues, saying they were insubstantive and simply aimed at creating impressions.

"These proposals, as others in the past, aim at creating impressions rather than dealing with the substance of issues," he said.

Turkey's proposals were handed to the Greek ambassador in Ankara earlier yesterday, and contained an invitation to Foreign Minister Theodoros Pangalos to visit Ankara. The premier said the proposals would be studied in detail,but stressed that politically, they did not differ in their substance from others in the past, which he said led nowhere.

"We need a reply to Greek positions on a step-by-step approach, on how the problem of delineation of the (Aegean) continental shelf is resolved. If this is done, then the two countries can build good relations," he stressed.

Commenting on Turkish Cypriot leader Rauf Denktash's refusal to participate in talks for Cyprus' accession to the EU, Mr. Simitis said it was certain that Mr. Denktash could not obstruct the entry of Cyprus into the Union.

"The procedure has been agreed, and the difficulties that lie ahead will be overcome," he said.

After attending a meeting of European Socialists' group, ahead of today's European Union enlargement conference here, the prime minister said further enlargement would serve the principles of stability and peace in the region, and that Europe should not simply be a common market but be distinguished by its social sensitivity and justice, environmental protection, and by improving living standards.

Positive estimates over course of Greek economy

Despite a recent hint by the Moody's international credit rating agency that it might downgrade Greece's standing shortly, international investors seem to be renewing their confidence in the country's economy. Merril Lynch yesterday announced its intention to issue an international five-year "drachma bond", bearing a fixed rate of 10.125 per cent.

JP Morgan has also announced that it has upgraded the Hellenic Telecommunications Organisation (OTE) as a company, thereby also upgrading its stock. The utility's analysts are forecasting that OTE's share price will rise from 6, 500 drachmas today to more than 8,000 by the end of the year. Given the marked 'weight' of the state-run organisation's stock in the volume of trading at the Athens Stock Exchange (ASE), the estimate is considered as a sign of confidence in the medium term course of the bourse.

The latest developments come in the wake of an SBC Warburg report stressing that the drachma is not overvalued and is most unlikely to be devalued after May 1, when the EU is expected to determine which currencies will comprise the euro.

In the report, the firm advises clients to invest in the drachma on a long- term basis. It also stresses that any fall in the international competitiveness of Greek products is not due to the government's stable drachma policy, but to higher Greek production costs, compared to other EU countries.

SBC Warburg considers that recent currency upheavals did not have an adverse impact on the Greek economy.

Another report, by the Dutch ABN-AMRO bank, says Greece's participation in EMU is feasible under certain conditions - mainly related to the promotion of necessary structural reforms. The report stresses that the Greek bond market will stabilise soon and interest rates will begin a downward slide down to the levels of other EU partners if the government boosts its current efforts for economic convergence.

Regarding the likelihood of a drachma devaluation, the bank, without ruling it out altogether, stresses that such a development would both cut short the decrease in inflation and hurt confidence in the convergence programme.

Britain emphasises commitment to Cyprus' EU accession talks

Britain said yesterday that it was committed to talks for Cypriot accession to the European Union, scheduled for begin on March 31, despite Turkish Cypriot objections. "Britain is committed to Cyprus' application for membership in the European Union," Foreign Secretary Robin Cook tol d a news briefing on the EU's enlargement conference, opening today in the British capital.

"We believe that Cyprus is a very strong candidate, has a much higher standard of living than the other candidates, a healthy economy, and has brought its legislation in line with the acquis communautaire," he said.

"We believe it would be unfair and a mistake if the procedure for Cypriot accession to the European Union was impeded by a veto from (Turkish Cypriot leader) Rauf Denktash or Ankara," he added, recognising that Cypriot government efforts to bring the Turkish Cypriots into membership negotiations were not sufficient for the accession of the entire island.

The so-called parliament in the Turkish-occupied Turkish Cypriot pseudo- state decided on Tuesday not to participate in negotiations and not to attend UN-sponsored peace talks unless the self-styled regime is recognised as a state by the international co mmunity.

Only Turkey, which occupies 37 per cent of Cyprus' territory, recognises the Turkish Cypriot pseudo-state, which was illegally set up in 1983.

Meanwhile, a spokesman for British Prime Minister Tony Blair stated: "the accession process embraces Cyprus and the countries of eastern Europe. This is what was agreed and that is what we will be pursuing," he added.

Replying to questions in the House of Commons on Tuesday, Mr. Cook said the negotiations were not subject to the veto of the regime in the Turkish- occupied northern Cyprus, adding that Turkish Cypriots stood "more to gain than anybody else in Cyprus from EU membership."

Greek-American leaders meet in Washington

Leaders of the Greek-American community had a two-hour conference in Washington yesterday under the auspices of Archbishop of America Spyridon.

Issues discussed included the defining of common goals and methods for achieving them as well as the role of the Church and Greek-American community groups.

Spyridon said the Church will not imvolve itself in non-ecclesiastical matters, rather, it will lead efforts in addressing the problems facing Greeks and Orthodox Christians throughout the world.

The re-opening of the Halki Theological School, banned for decades by Turkish authorities, is also a priority, Spyridon added.

Karamanlis calls for transparency in police promotions

Main opposition New Democracy (ND) leader Costas Karamanlis yesterday met with the presidium of the National Federation of Police Officers, where he reiterated his support for transparency regarding police promotion procedures.

Mr. Karamanlis said that able officers are passed over for promotion, while party favourites are promoted.

ND deputy Prokopis Pavlopoulos said ND will propose a system of police promotions similar to that of the armed forces as well as a continuous training programme.

In response, Public Order Minister George Romeos said that Mr. Karamanlis is tarnishing police officers in order to minimise impressions from ND's interparty problems.

Mr. Romeos said that "it is at least malicious for a party president to call officers as party favourites for political gain."

He added that the government "promoted (able officers) that are respected by police force personnel and have shown worthy activity."

Regarding these comments, ND spokesman Aris Spiliotopoulos said that results of government policies are obvious, since there is a total absence of policing, leaving citizens to live under a state of fear.

Yiannopoulos says gov't prepared to move prisons from cities

Justice Minister Evangelos Yiannopoulos yesterday announced that the government has decided to transfer all correctional facilities out of cities.

Speaking in Parliament, he added that seven modern facilities are already under construction, while a 400-bed capacity methadone programme is being promoted for a prison in Thebes.

Mr. Yiannopoulos also said that he proposes that possession of small amounts of illegal narcotics by drug users should be treated as a misdemeanor, although there will be no decriminalisation of drugs.

Karamanlis undergoes leg surgery

Main opposition New Democracy (ND) leader Costas Karamanlis yesterday underwent surgery on his leg following an injury he sustained during a football game between Parliament deputies from different parties. The game took place yesterday afternoon at the Leoforos Alexandras stadium.

Prime Minister Costas Simitis, from London, sent a telegramme wishing him a quick recovery.

Greece says its coastal fleet maintains high world standards

Greece's coastal shipping fleet has the highest international standards in its category, Merchant Marine Minister Stavros Soumakis told reporters yesterday.

He was commenting on foreign press reports hitting the country's maritime industry ahead of the summer tourism season.

"This is an annual phenomenon," Mr. Soumakis said. "Every year foreign competitors try to hit Greece's coastal shipping industry through negative press reports. Their effort will fail once again."

Mr. Soumakis also said that the government will seek a change in the legal status of the country's two largest ports, Piraeus and Thessaloniki, in order to become more competitive.

Gov't tax revenues rise 18.15 pct in Jan-Feb

The Greek government's tax revenue rose 18.15 percent in January-February compared with the same period last year, Finance Undersecretary George Drys said yesterday.

Gov't to keep civil servants' tenure intact

The government has no current plans to abolish permanent tenure for civil servants, acting government spokesman Nikos Athanasakis said yesterday.

He said that tenure was linked to a review of the country's constitution.

Greek stocks climb again on falling interest rates

Greek equities resumed their upward trend on the Athens bourse yesterday to score further gains.

Traders said market sentiment remained positive following a gradual decline in interbank rates and a steadier drachma. Construction stocks were the focus of attention and led the market higher.

The general index closed 0.90 percent higher at 1,531.26 points.

Banks rose 0.65 percent, Insurance increased 0.72 percent, Leasing fell 0.13 percent, Investments ended 1.73 percent up, Industrials rose 0.72 percent, Construction soared 3.92 percent, Miscellaneous jumped 2.65 percent and Holding was 0.10 percent off.

The parallel market index for small cap companies rose 1.27 percent. The FTSE/ASE blue chip index ended 0.91 percent up at 862.83 points.

Trading was heavy with turnover at 23.2 billion drachmas. Hellenic Telecommunications Organisation's share price rose 95 drachmas to 6,515 in heavy volume of 558,850 issues.

Broadly, advancers led decliners by 165 to 64 with another 15 issues unchanged.

Technodomi, Gnomon, Attikat, Halyps Cement, Athinea, Alte and Proodeftiki scored the biggest percentage gains at the day's 8.0 percent upper volatility limit, while Desmos, Ippotour and Mouzakis suffered the heaviest losses.

National Bank of Greece ended at 22,650 drachmas, Ergobank at 16,030, Alpha Credit Bank at 17,000, Delta Dairy at 3,100, Titan Cement at 14,900 and Intracom at 15,750.

Gov't to install Thessaloniki airport radar despite protests

Greece's government will go ahead with the installation of a new radar system for Thessaloniki's international airport despite protests by residents, Transport and Communications Minister Tasos Mantelis said yesterday.

The radar is due for installation near the airport in Perea, where residents fear they will be exposed to high levels of radiation from the system.

Mr. Mantelis told a news conference the radar was a key step in making Macedonia airport a centre for combined transport operations in southeastern Europe.

Greece to launch pilot Skopje-Thessaloniki rail link

Hellenic Railways Organisation (OSE) will launch a pilot rail link between Skopje and Thessaloniki on April 9 using high-speed Intercity trains, a senior OSE official said yesterday. The state company plans to include Balkan destinations as part of its drive to modernise services and revitalise, OSE managing director Ioannis Mourmouris told a news conference.

OSE's five-year investment plan had a budget of 440 billion drachmas for rail operations and 226 billion for rolling stock, Mr. Mourmouris said. He claimed that the state company's 160-billion drachma deficit was due to phenomena including "non-existent shifts, overtime and training by OSE staff".

Needed was a rationalisation of routes and station operations. Mr. Mourmouris cited as an example a station that had revenue of eight million drachmas and spending on wages of 45 million.

"A private company on an eight percent commission could achieve the same results," he said.

Asked if OSE staff would be made redundant, Mr. Mourmouris said: "This will be unnecessary in the first stage due to retirement on the basis of age, but if it is needed later then we must have the courage to do so, without, of course, creating social problems."

OSE's 1998 business plan will be ready on March 18, he said.

Allianz to insure Greek building projects

Allianz, a Greek-based subsidiary of the German insurer, has signed contracts covering three new construction projects in Greece.

The projects are construction of rail tunnels at Platamonas, budgeted at 27 billion drachmas, construction of road tunnels in the Tymphristos mountain worth 3.5 billion drachmas, and construction of a concert hall in Thessaloniki (11 billion drachmas).

Allianz has already signed insurance contracts for the Athens metro and the Spata airport projects.

Public works credits

Credits amounting to 10.7 billion drachmas have been earmarked for the auctioning of highway portions on the Kozani-Ptolemaida national motorway, flood-protection projects in the prefectures of Pella, Rhodes, Karditsa, Trikala and Larisa, as well as infra structure works for the Attica road network.

WEATHER

FOREIGN EXCHANGE

(C.E.)

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