Athens News Agency: News in English (AM), 98-09-25

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

NEWS IN ENGLISH

Athens, Greece, 25/09/1998 (ANA)

MAIN HEADLINES

• Top police officials removed following botched hostage raid
• Pangalos to UN General Assembly: Ankara promotes Cyprus' partition
• Pangalos pessimistic over prospects of upcoming Antalya summit
• Reservations over any multinational strike in Kosovo
• Papandreou: Cyprus EU prospects upset Turkey's strategy
• First-ever Ombudsman's office in Greece opens
• Parliament debates on the Internet
• Court rules civil aviation employees strike illegal
• Gov't launches subscriptions for privatisation bonds today
• Industrial output, construction rise sharply
• Gov't formally submits bourse reform bill to parliament
• Greek stocks jump following Wall Street hopes of US rate cut
• Parliament committee okays reduction in tax fines
• Weather
• Foreign exchange

NEWS IN DETAIL

An urgent preliminary investigation was called yesterday to examine the circumstances surrounding Wednesday night's hostage drama in downtown Athens, which ended in a badly botched raid by police.

The unprecedented incident - the detonation of a handgrenade planted on one of the hostages by a Romanian outlaw - left two people critically wounded, and another 10 with various degrees of injuries, most high-ranking police officers.

In the aftermath, the chief of Greek Police Athanasios Vassilopoulos offered his resignation, which was accepted. In addition, the head of police forces in Attica, Yiannis Georgakopoulos, and the director of security, Theodoros Papafilis, were dismissed . All three men were injured in the blast.

Public Order Minister George Romeos announced the decisions after meeting Prime Minister Costas Simitis. The Greek premier rejected the resignations tendered by Mr. Romeos and the ministry's secretary-general, Yiannis Papadogiannakis.

A new head of police will be appointed today, when the Government Council for Foreign Affairs and Defence (KYSEA) meets.

Pandemonium broke out after police commandos stormed a first-floor apartment where 27-year-old Sorin Matei was holding three hostages, threatening to detonate a grenade. In a late night press interview, Mr. Papadogiannakis said police stormed the apartment in the belief that the grenade was fake.

Matei received treatment for his injuries and is being kept under armed guard.

Pangalos to UN General Assembly: Ankara promotes Cyprus' partition

Foreign Minister Theodoros Pangalos yesterday accused Turkey of promoting the partition of Cyprus by its intransigence instead of contributing to a just and viable solution to the island republic's protracted problem.

"The reaction from Ankara, obediently echoed by the Turkish Cypriot leadership has been one of harsh rejection. Either in terms of a flat negation, or by putting conditions, tantamount to cancelling whatever has been so far desired by the international community, prescribed by the UN resolutions and even accepted by the Turkish Cypriot leadership themselves, " Mr. Pangalos said in his address to the 53rd United Nations' General Assembly yesterday.

"Such an attitude of rejection is easily explained by notorious designs of the Turkish government to effect the partition of Cyprus. Mr. (Bulent) Ecevit, deputy prime minister of Turkey, has in several occasions pointed out that the Cyprus question had be en resolved, once and for all, by his country's armed forces invasion in 1974," he added.

"It is time for the international community to strongly support the UN Secretary General to fulfill his mandate, to bring the two communities to the negotiating table, to initiate a dialogue on gradual disarmament towards the complete demilitarisation of the island," he added.

"Greece wishes to establish good neighborly relations with Turkey, based on the principles of international law and respect for international treaties, " the Greek foreign minister told the assembly referring to Greek-Turkish relations.

Pangalos pessimistic over prospects of upcoming Antalya summit

Foreign Minister Theodoros Pangalos yesterday appeared pessimistic over prospects for a Cyprus problem solution and possible progress on resolving differences during a planned meeting of the Greek and Turkish prime ministers in Antalya, Turkey, in November.

"The strategy of the Turkish military and (Deputy Prime Minister Bulent) Ecevit is to close all doors," he told reporters after 90 minutes of talks with US Assistant Secretary of State for Europe Mark Grossman.

Discussion, besides Cyprus, involved a series of other issues, including Kosovo, Albania, and the Middle East. Responding to questions on the results of the meeting, Mr. Pangalos said all issues were "making headway".

Mr. Grossman said discussion had been substantive and important".

Pointing out that the US proposition and effort "is to try to bring the right kind of solution to Cyprus", Mr. Grossman reaffirmed that the US position is for a "bi-zonal, bi-communal federation".

Reservations over any multinational strike in Kosovo

Greece continues to have reservations about the possibility of a strike by international forces in Kosovo and would continue to urge a political resolution to the problem, Athens stressed yesterday.

Government spokesman Dimitris Reppas said the Greek government doubted the effectiveness of a military intervention but would take part in any operation if the legal framework for it was ensured.

He said however that talk of an intervention was still premature, given the UN Security Council had yet to decide on one.

In New York, Foreign Minister Theodoros Pangalos said Greece did not agree with the view that the resolution granted NATO a free hand to intervene, and that in his opinion NATO continued to hold such a prospect as a warning and a threat.

Papandreou: Cyprus EU prospects upset Turkey's strategy

Alternate Foreign Minister George Papandreou expressed the view that the prospect of Cyprus joining the EU has upset Turkey's strategy on the island's political problem, and that Ankara's negative reaction is intensifying its isolation even further.

"The course towards EU accession has clearly overturned the established situation of recent years, a strategy of Turkey that aimed to hold the Turkish Cypriots hostage on the pretext that only under its own protection could their integration be realised ," he said, in an interview with Cyprus state radio during his recent visit here in his capacity as current president of the ministerial committee of the Council of Europe.

"At a parallel level, all the arguments which Turkey hitherto used in order to justify the unjustifiable nature of its intervention...have fallen flat, and it now finds itself before an impasse to which it reacts in the worst possible way, with more tensi on, polarisation and antagonism.

First-ever Ombudsman's office in Greece opens

Prime Minister Costas Simitis yesterday officially inaugurated the first- ever Ombudsman's office in Greece, announcing the appointment of an assistant ombudsman to handle issues relating to individuals serving in the armed forces.

Mr. Simitis said the assistant ombudsman would contribute to the better protection of the fundamental rights of soldiers and would work closely with Defence Minister Akis Tsohatzopoulos, Interior Minister Alekos Papadopoulos and the new Ombudsman, Nikif oros Diamantouros.

The office of the Ombudsman will open to the public as of Oct. 1 and is located at 5, Hatziyiannis Mexis St. in Athens.

Parliament debates on the Internet

Parliamentary debates will be broadcast with both image and sound through Internet as of October, while debates of Parliamentary committees may also be broadcast very soon.

In a statement yesterday, Parliament President Apostolos Kaklamanis revealed that Parliament is ready to broadcast debates through Internet, adding that the creation of television archives containing debates, speeches and other Parliamentary activities will also commence.

Court rules civil aviation employees strike illegal

An Athens court on Thursday ruled that a four-day, 24-hour rolling strike called by the Federation of Civil Aviation Employees is "illegal and abusive".

The court ruling followed recourse by the administration of state-owned Olympic Airways.

Following the development, the Civil Aviation Authority has notified all airline companies that flights will continue unimpeded.

On Thursday, the first day of the strike, nine flights were cancelled, eight of Olympic Aviation and one of Olympic Airways.

Civil aviation employees are protesting against planned changes in the institutional framework of work regulations, being introduced by the government.

The employees are demanding that two bills due to be submitted to parliament be scrapped. They charge that the bills provide for the establishment of a company which would regulate airports and civil aviation.

Gov't launches subscriptions for privatisation bonds today

The government today opens subscriptions for an equity convertible bond launched to aid its privatisation drive and raise around 350 billion drachmas for state coffers.

The bonds, called prometoha, will be convertible into the equity of firms to be privatised through the bourse from January 1, 1999.

Handling the issue are National Bank of Greece, Eurobank and Paribas of France - an expert in Balladur privatisation bonds.

Finance Undersecretary Nikos Christodoulakis has met institutional investors at home and abroad over the past week in order to promote the securities.

Book-building for domestic institutional investors will be held on 25-29 September. The deadline for retail investors to subscribe to the public offer is October 2.

The bonds in electronic form will have a three-year duration and remain tax- exempt if the original buyer holds them until maturity, or exchanges them for stock in the listed, privatised companies.

The rate and yield of the bonds will be set on September 29 in line with bids submitted by institutional investors.

On offer are 170 billion drachmas worth of bonds. Another 50 billion drachmas of paper will be issued if demand is heavy. The issue date is October 9, 1998 with expiry on October 9, 2001.

The ministry has said it will not issue new equity convertible bonds in coming years.

Industrial output, construction rise sharply

Industrial production jumped 8.4 percent in July to show a 5.1 percent increase in January-July compared with the same period last year, the Greek National Statistics Service (GNSS) said yesterday.

Construction activity was also sharply higher, rising by 12.7 percent in June, to show a 10.7 percent increase in January-June of 1998 compared with the corresponding period of 1997, GNSS said.

Gov't formally submits bourse reform bill to parliament

The government yesterday gave parliament a bill that eases entry for Greek and foreign firms into the Athens Stock Exchange, making the bourse more competitive.

The bill's introduction said that the change in legislation was needed due to introduction of the euro, which would open the Athens bourse to greater competition from stock markets abroad that often had more favourable entry requirements.

Government officials have said that the new law will allow better investment prospects for many domestic firms currently barred from the market due to current stringent listing requirements.

The authorities held consultations with market players before submitting the bill, leading to changes in some of the rules originally contained in the bill.

The overhaul is expected to lead to more listings for firms with growth potential, spur large domestic or multinational firms to seek entry, and upgrade the role of the capital markets commission.

The main points of the bill that is destined for parliamentary debate and then a vote are as follows:

- Application for listing requires the publication of balance sheets for three consecutive years, which need not show profitability. The current requirement of five straight years of profitability has been scrapped. For evaluation are a firm's asset com position and its mid-term prospects for profitability.

- The asset composition of applicants has to be satisfactory on the basis of the latest balance sheet, with a floor for equity capital of 2.0 billion drachmas from one billion currently in force. Before consultations, the bill originally set 1.5 billion drachmas.

A 25 percent share capital increase is no longer mandatory for entry into the bourse.

- A company's share distribution on listing will be acceptable if at least 25 percent of share capital is sold to the public, or there are at least 2, 000 shareholders. - The price of a share can vary for sale to different categories of investors.

It can also be fixed or fluctuate within a range of 15 percent either way.

- The underwriters of initial public offerings will have the right to intervene in the market in order to support a stock's price for three months from the company's date of entry. Before consultations, the time period was six months.

- For entry into the bourse's parallel market for smaller cap stocks, companies must have a minimum shareholders' equity of 500 million drachmas and have published two balance sheets before entry, the latest showing profits.

They will also have to post high enough profits in the fiscal year before entry to allow payment of a dividend equivalent to six percent of their stock's price.

Firms already listed on the parallel market will have to increase their share capital to 500 million drachmas within the next three years.

Greek stocks jump following Wall Street hopes of US rate cut

Equities ended sharply higher on the Athens Stock Exchange in moderate trade yesterday following a spectacular rise on Wall Street in the previous session on hopes of lower US interest rates.

The general index ended 2.23 percent up at 2,188.89 points with turnover at 44.6 billion drachmas.

Sector indices scored gains. Banks rose 2.72 percent, Insurance was 0.74 percent up, Investment increased 1.76 percent, Leasing ended 1.83 percent higher, Industrials rose 1.82 percent, Construction jumped 2.25 percent, Miscellaneous ended 1.87 percent up and Holding rose 1.02 percent.

The parallel market index for small cap companies rose 2.07 percent, and the FTSE/ASE 20 blue chip index gained 2.47 percent to 1,323.17 points.

Broadly, advancers led decliners by 174 to 60 with another 20 issues unchanged.

National Bank of Greece ended at 40,700 drachmas, Ergobank at 24,400, Alpha Credit Bank at 22,520, Ionian Bank at 10,460, Hellenic Telecoms at 6,790, Delta Dairy at 3,190, Intracom at 11,435, Hellenic Petroleum at 2,540 and Titan Cement at 18,300 drachmas.

Parliament committee okays reduction in tax fines

A Greek parliamentary committee yesterday unanimously adopted an amendment to a tax bill allowing discounts on fines for overdue taxes.

The amendment offers taxpayers a 50 percent discount on fines if they pay their debts in a lump sum, and a 15 percent discount if they pay in 30 instalments.

WEATHER

FOREIGN EXCHANGE

(C.E.)

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