Athens News Agency: News in English (AM), 98-05-07

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

NEWS IN ENGLISH

Athens, Greece, 07/05/1998 (ANA)

MAIN HEADLINES

• Simitis briefs party leaders on euro summit, gov`t policy
• State-run Ionian Bank to be sold through bourse
• Athens' priorities for CoE presidency outlined
• Kranidiotis criticism of latest Holbrooke mission
• US State Dept. on reports citing PKK office in Athens
• Gov't, PASOK delegation to visit US
• Cyprus-Greece cooperation 'excellent', Clerides says
• Finnish House speaker in Athens today
• Piraeus mayor jailed over financial irregularities
• Gov't denies friction with new Archbishop
• Greece, Spain set up business union to boost trade, investments
• Greek equities slump in overbought market
• Greece should stick to convergency plan to gain euro entry
• Weather
• Foreign exchange

NEWS IN DETAIL

Prime Minister Costas Simitis yesterday briefed party leaders on the outcome of last weekend's European Union summit to launch the euro, as well as on the government's plans to tidy up the economy by 2001, when Greece hopes to join the Economic and Monetary Union (EMU).

Mr. Simitis first briefed Costas Karamanlis, the leader of the main opposition New Democracy party, who told reporters afterwards that the government had to change its tactics if Greece was to meet Maastricht targets for EMU accession.

He said he told the prime minister that the government had to show a willingness to overhaul the public sector, carry out wide-ranging privatisation, contain public spending, and fuel growth.

Communist Party of Greece (KKE) Secretary General Aleka Papariga said her party would reject measures that bowed to the "interests of bankers, industrialists, rich Greeks and Europeans in the name of EMU."

Coalition of Left and Progress leader Nikos Constantopoulos criticised both the ruling PASOK party and the main opposition for their policies regarding Greece's participation in EMU.

Democratic Social Movement (DHKKI) leader Dimitris Tsovolas, a former PASOK minister, expressed the fear that Greece would weaken in the EU.

After his briefing yesterday, Political Spring (Pol.An.) leader Antonis Samaras described the country's exclusion from the first group of countries to join EMU as a national failure.

State-run Ionian Bank to be sold through bourse

The government said yesterday it will sell Ionian Bank, a subsidiary of state-run Commercial Bank, through a bidding process on the Athens Stock Exchange.

National Economy and Finance Minister Yiannos Papantoniou announced the decision after talks with the chairmen of Ionian and Commercial Banks. Both banks are listed on the bourse.

Under the plan, Commercial Bank, which holds a 62 per cent stake in Ionian Bank, will offer a majority stake through the bourse.

The plan will need approval from Commercial Bank's shareholders, who are due to meet in June.

A sale process and timetable will be announced after the shareholders' assembly.

Ionian Bank is Greece's fourth largest commercial bank.

It has assets of 2.2 trillion drachmas and a 7.2 per cent stake in the domestic banking market, holding around 6 per cent of loans and 7.5 per cent of deposits nationwide.

The bank has about 4,350 employees and 220 branches.

Mr. Papantoniou justified the government's decision to sell the bank on the grounds that Ionian Bank could not remain competitive in the domestic banking sector under its present status and following introduction of the euro. He said that a solution to merge Ionian Bank with Commercial Bank - its main shareholder - was rejected as carrying a greater social and economic cost.

The Ionian Bank employees' unions decided on a four-hour work stoppage today for Attica branches, between 11:30 a.m. and 3:30 p.m., as well as a rally outside the bank's central offices.

They also called for a 24-hour, nation-wide strike tomorrow and a 48-hour strike at the bank's data processing centre.

Athens' priorities for CoE presidency outlined

Alternate Foreign Minister George Papandreou yesterday outlined the priorities of Athens' Council of Europe (CoE) presidency, as Greece is set to assume the six-month rotating presidency from Germany.

He noted that Greece will promote decisions of the 102nd conference of the CoE's Ministerial Committee, which concluded here yesterday.

Mr. Papandreou said that the creation of a post for a human rights commissioner, upgrading of the CoE's parliamentary assembly's relations with the Ministerial Committee and the creation of a single unified court to combat organised crime through cybers pace will be the major issues that the Greek presidency will promote.

Kranidiotis criticism of latest Holbrooke mission

Foreign Undersecretary Yiannos Kranidiotis yesterday criticised US presidential envoy for the Cyprus problem Richard Holbrooke for not having exerted appropriate pressure on the Turkish Cypriot side.

Mr. Kranidiotis was speaking before the parliamentary foreign affairs committee on Holbrooke's failure last weekend to restart reunifi-cation talks on Cyprus.

"Holbrooke's mistake was that he did not exert the appropriate pressure on the Turkish Cypriot side, he did not attribute responsibility (for the failure) where it belonged and he maintained a policy of equal distances," Mr. Kranidiotis said. Mr.

Kranidiotis hastened to add, however, that some of Holbrooke's statements shortly before leaving the island republic on Monday had been misconstrued.

The positive element which emerged from Mr. Holbrooke's mission, Mr. Kranidiotis said, is that the United States is not going to recognise the pseudo-state of Turkish Cypriot leader Rauf Denktash and that it was made clear that it is the Turkish side wh ich is intransigent, provocative and the trouble-makers of the region.

US State Dept. on reports citing PKK office in Athens

The US is expecting a clarification of Athens' positions following reports citing the opening of Kurdish Workers' Party (PKK) offices in Greece, according to a statement here yesterday by acting State Department spokesman Lee

McClenny.

"The US cooperates closely with Greece in combatting both domestic and international terrorism", the statement read, adding that "we are seeking Greek government views on whether or not a new PKK office is, in fact, being established."

The State Department official observed that Washington viewed the alleged political support offered to PKK by some members of Greece's Parliament as "inconsistent with both a responsible stance towards international terrorism and the goal of reducing Gr eco-Turkish tension."

Gov't, PASOK delegation to visit US

A joint government and ruling PASOK delegation begins a six-day visit in the United States today, headed by party secretary Costas Skandalidis.

Activities during the visit include participation of a conference on expatriate Greeks and a conference of PASOK branches in North America, focusing on finalising the partyYs organisational shape.

While in US, the Greek delegation will also have contacts and meetings with Democratic Party representatives, Congressmen, senators and other officials.

Foreign Undersecretary Yiannos Kranidiotis and Finance Undersecretary Nikos Christodoulakis are among the members of the delegation.

Cyprus-Greece cooperation 'excellent', Clerides states

President Glafcos Clerides has reiterated that cooperation with Athens is "perfect" and fully backed Greek government policy on the Cyprus question.

In a written statement, the president also thanked Greece for its unwavering support in Cyprus' efforts to find a peaceful settlement of the Cyprus question, adding that bilateral ties should be safeguarded at all costs.

The statement was issued here yesterday in the wake of criticism Mr. Kyprianou levelled against the Greek premier that he subscribes to US policy with regard to improving relations with Turkey.

Mr. Kyprianou's comments came after US envoy for Cyprus, Richard Holbrooke, failed to resume the stalled peace talks because of Turkish Cypriot demands for the withdrawal of Cyprus' application for European Union membership and recogntiion of the illega l regime in the Turkish occupied part of the island.

"The government of the Republic of Cyprus, undertaking fully its responsibilities, has not sought and will not seek to apportion non-existent responsibilities for so-called bad moves on the Greek government and underlines that relations between Athens a nd Nicosia need to be safeguarded at all costs", President Clerides said.

Responding in a written statement later, Mr. Kyprianou said he fully acknowledged the necessity for the existence of excellent relations between the Cypriot and the Greek governments.

Finnish House speaker in Athens today

The Finnish president of Parliament Ritta Maria Uosukainen begins a three- day official visit to Greece today, on the invitation of Parliament President Apostolos Kaklamanis.

Ms Uosukainen is scheduled to meet with President Kostis Stephanopoulos, Kaklamanis and Foreign Minister Theodoros Pangalos,

Piraeus mayor jailed over financial irregularities

Piraeus Mayor Stelios Logothetis was remanded in custody yesterday after being charged with seven offences, including embezzlement of 1 billion drachmas from the municipality's coffers.

The remand decision was taken by public prosecutor Aristides Frangiadakis and investigating magistrate Maria Frangiadakis.

The reasoning for the decision was that Mr. Logothetis might commit further offences.

"I am very pleased because today the true face of (Prime Minister Costas) Simitis' oligarchy revealed itself. The frame-up against me which began in 1994 is now being manifested as panic, because none of the charges can excuse the very harsh measures t aken against me. It's all a frame-up. I defy the Institute of Chartered Accountants to come out and say in public who stopped them from publishing the figures which rebut all charges," Mr. Logothetis said.

According to yesterday's decision, Mr. Logothetis must be remanded in Korydallos jail before sundown.

Gov't denies friction with new Archbishop

The government yesterday denied press reports citing friction between Prime Minister Costas Simitis and newly appointed Archbishop of Athens and All Greece Christodoulos.

"There is no such issue," government spokesman Dimitris Reppas said, commenting on press reports claiming the fact that Mr. Simitis would not be attending the prelate's enthronment ceremony on Saturday.

The spokesman said Mr. Simitis would not be attending simply because it was not on his agenda, reiterating that there was "no problem" with Christodoulos, whom he described as "gifted".

Greece, Spain set up business union to boost trade, investments

Greece and Spain, two European Union countries that have traditionally been rivals in trade, joined forces yesterday and created an Athens-based business group.

The Greek-Spanish Business Union was launched at the Athens Chamber of Trade and Industry following an initiative by the Spanish Embassy.

President of the new business union is George Vasilakis, owner of Technocar, which imports Spanish Seat cars. dollars - a figure both countries want to see grow. The trade balance has been against Greece for many years.

Spanish exports to Greece are worth about 1.0 billion dollars annually, comprising cars, yarn, textiles, tiles, iron and steel.

Greek exports to Spain are worth about 300 million dollars from sales of oil, fats, cereals, goods made of non-metallic minerals and leather.

Officials say there is scope for exports of Greek farm and industrial products to Spain, and participation in industrial joint ventures, including foodstuffs processing and preserving aimed at Spanish-speaking countries and the Balkans.

A large Spanish chain is planning to open three hotels in Greece, and there is Spanish participation in a consortium designing an undersea tunnel for the Malliakos Gulf in the east of the country.

Greek equities slump in overbought market

Greek equities yesterday changed direction on the Athens Stock Exchange to end substantially lower in a retreat from the previous day's record close.

Traders said the market looked overbought to many investors who felt nervous at the 2,700-point resistance level.

The general index ended 1.97 percent down at 2,587.62 points with most sector indices losing ground.

Banks fell 2.10 percent, Insurance dropped 3.50 percent, Investment eased 1.95 percent, Leasing rose 0.02 percent, Industrials rose 1.51 percent, Construction fell 2.82 percent, Miscellaneous increased 2.33 percent and Holding plunged 5.30 percent.

The parallel market index for small cap companies eased 2.44 percent.

The FTSE/ASE 20 blue chip index dropped 2.26 percent to 1,565.58.

Trading was heavy with turnover at 87 billion drachmas.

Broadly, decliners led advancers by 149 to 100 with another 15 issues unchanged.

Minoan Lines, Nematemboriki, Strintzis Lines, Rilken, Bank of Pireaus, Bank of Athens, Papoutsanis, Rokas and Fourlis scored the biggest percentage gains hitting the 8.0 percent limit up.

Klonatex, Altec, Ideal, Dane Sea Line and Hellenic Biscuits suffered the heaviest losses.

National Bank of Greece ended at 53,400 drachmas, Ergobank at 27,550, Alpha Credit Bank at 32,900, Delta Dairy at 5,590, Titan Cement at 25,000, Intracom at 18,900 and Hellenic Telecommunications Organisation at 8, 650.

In the domestic money market the drachma eased against most foreign currencies ending a two-day rally.

Greece should stick to convergence plan to gain euro entry

Strict adherence to the government's economic convergence programme will secure Greece's participation in the euro on January 1, 2002, when the currency is introduced in physical form, the governor of National Bank of Greece said yesterday.

Theodoros Karatzas, addressing a shareholders' assembly, said that leaders at a European Union summit to launch the euro had praised progress made by the Greek economy based on implementation of its EU convergence programme.

He predicted that interest rates would start falling within 1998, a trend likely to accelerate next year.

Mr. Karatzas announced that National Bank of Greece's first quarter profits rose 41.1 percent from the corresponding period last year to 27.8 billion drachmas, setting the bank on a course for higher results in the year.

The bank would pay a 1,100 drachma dividend.

WEATHER

FOREIGN EXCHANGE

(C.E.)

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