Athens News Agency: News in English (AM), 98-12-08
NEWS IN ENGLISH
Athens, Greece, 08/12/1998 (ANA)
- Simitis-Schroeder talks focus on `Agenda 2000` financing
- Central bank to cut intervention rates this week, minister says
- Stocks jump as market players discount lower interest rates
- Panafon to join bourse's FTSE/ASE-20 index
- National Bank of Greece chief sees EMU entry close at hand
- NAPC lays-off entire workforce
- EU foreign ministers' council agree on text for Vienna summit
- Russia's Zyuganov due in Athens
- Thessaly-area farmers gear for mobilisations
- Foreign exchange
NEWS IN DETAIL
Simitis-Schroeder talks focus on `Agenda 2000` financing
Prime Minister Costas Simitis met in Bonn yesterday with German Chancellor
Gerhard Schroeder, with both men agreeing there was a difference in opinion
between the two states over the issue of EU financing for 'Agenda
However, in statements to the press following Mr. Simitis' meeting with the
new German chancellor, both men said that they would deal with the problem
"in a spirit of mutual understanding, with all eyes trained on the future
and with the goal of succeed ing in reforms to the EU".
Greece and Germany differ on the issue of funding for the EU's 'Agenda
2000' programme of budget and spending policy reforms.
Athens is opposed to a proposal for a freeze of funds for 2000-2006 and
spending cutbacks for economic and social cohesion to allow poorer
countries to catch up with wealthier EU partners.
Mr. Simitis said that Greece, given its position on the "last step on the
EU ladder", insisted on the policy underpinning the social and economic
Mr. Schroeder said he understood the existence of diverging interests, and
admitting that the German EU presidency's work on 'Agenda 2000' was
Germany takes over the rotating presidency of the European Union on Jan. 1,
1999 and will preside over talks on budgeting, expected to conclude in
Regarding Turkey's status vis-a-vis accession to the European Union, Mr.
Schroeder said it took the Copenhagen summit criteria on Turkey's bid to
join the EU "seriously". The Copenhagen summit said Ankara needed to work
on human rights and democratic ref orms and relations with its neighbours
before it could be considered for accession. The decision has strained
relations between Ankara and the 15-member EU.
"We want to exercise the policy which the EU has been applying towards
Turkey for years. We are not of the opinion that the EU is a religious
community, namely, a community based on religion, but we are of the opinion
that the EU is a community of values, a community starting from the common
conception of these values.
"Human rights is an issue which plays, according to our views, a leading
role. Europeans decided in Copenhagen what is included in these values,
such as torture not to take place and human rights to be safeguarded in
their wider sense. When these precon ditions are fulfilled, then the door
to Europe must also be open for Turkey. Therefore, it is up to Turkey
whether it will fulfill these preconditions or not," Mr. Schroeder
The German chancellor said that in light of the European Union summit this
Friday, Germany would not seek an upgrading of Turkey's status to equal
"There is no such issue," Mr. Schroeder said.
"On the question of the Vienna summit, allow me to say that both of us (Mr.
Schroeder and Mr. Simitis) agree that no decisions concerning enlargements
will be taken there, or with regard to the circle of candidate countries.
In this sense, the principles which we consider correct are harmonised with
the principles applied by the EU in general," he added.
On Athens' standing claim for a repayment of a wartime loan forcibly
extracted from the Greek central bank, Athens received no joy: Mr.Schroeder
told the Greek prime minister that the new government would continue the
policy on this issue forged by its predecessors and that it was not about
to "open a chapter" on paying compensation to victims of the Nazi occupiers
in Greece or the repayment of the loan.
"We see no possibility of reopening this issue. Given the contractual
relations (the relations between the two countries which are determined by
treaties and agreements), as well as friendly relations which have
developed between our countries, we consi der this issue closed. We
discussed this and I took into consideration that my Greek colleague raised
this issue," Mr. Schroeder said.
The German chancellor said he had accepted an invitation from Mr. Simitis
to visit Greece extended to then-chancellor Helmut Kohl during Simitis's
visit to Bonn in 1997.
He said he expected to visit Greece on the completion of the German EU
presidency in June 1999.
His visit will be the first visit to Greece by a German chancellor since
Helmut Schmidt 23 years ago when Constantine Karamanlis was premier of
Central bank to cut intervention rates this week, minister says
National Economy and Finance Minister Yiannos Papantoniou said yesterday
that the central bank would nudge down its money market intervention rates
this week, accelerating the decline in the second half of 1999.
The government endorsed the Bank of Greece's conservative policy of a
gradual drop in rates to keep pace with the rate of decline of underlying
inflation, Mr. Papantoniou said.
Rates would continue to fall, but the decline would be more abrupt in the
second half of 1999.
The rate cut later this week was the result of consultations between the
central bank and the government, said Mr. Papantoniou, addressing the
opening of a conference on the economy held by the Hellenic-American
The Bank of Greece's weekly intervention generally takes place on a
He expressed optimism that the economy would meet targets for entry into
European economic and monetary union (EMU), saying that the goal was
realistic of lowering inflation to 4.0 percent by the end of the year, and
then to 2.0 percent by the end of 1999.
In addition, the government's attainment of its targets had boosted the
economy's credibility abroad.
International investment houses were taking the country's EMU entry for
granted and recommending to their clients to purchase domestic state
"It is already time to start thinking about the post-EMU entry period," Mr.
The state's net revenue from privatisation in 1998 was 700 billion drachmas,
or two percentage points of GDP.
The first cycle of structural change in the economy had been successfully
completed as 13 of 22 moves promised by the government after the drachma's
devaluation in mid-March had been effected, Mr. Papantoniou said.
The government's reforms aimed to improve infrastructure, create a more
flexible labour market, modernise the capital market and reform the public
Mr. Papantoniou also said that the government's privatisation programme was
proceeding as planned, except for Ionian Bank and Hellenic Duty Free Shops,
both of which would be sold early in 1999.
Conceding that the new German government had toughened its position on EU
cohesion fund monies to Greece in the European Union's Agenda 2000
negotiations, he pointed out that the fellow EU member had much to gain
from award of the financing.
The minister cited as an example a new international airport for Athens
being built by Hochtief of Germany, saying that much of EU funding for the
airport was being channeled back to Germany.
Greece and other southern EU member states would wage a tough battle to
avert a reduction of monies in the EU's Third Community Support Framework
(CSF) being drafted from the Second CSF.
"Our policy is steady, we are cool-headed, and we shall use all available
weapons if necessary," Mr. Papantoniou said, adding that Greece would not
hesitate to use its right of veto to block EU enlargement.
The matter was critical for Greece as its economy would not be able to
achieve true convergence after EMU entry without those funds, he said.
For Third CSF funds, private capital would be sought for most major
projects. Eighty percent of Second CSF projects would be completed by end-
Finally, Mr. Papantoniou assured that the resignation of the managing
director of listed Hellenic Telecommunications Organisation did not signal
any change in policy, and his successor would retain the same policy of
international expansion and modernisation.
He also said that a strategic investor in ailing national carrier Olympic
Airways would be found by March 1999.
Stocks jump as market players discount lower interest rates
Equities surged on the Athens Stock Exchange yesterday discounting a drop
in the central bank's money market intervention rate this week, which in
turn would signal cuts across the board by commercial banks.
The general index ended 4.12 percent higher at 2,570.73 points, sprinting
through resistance at 2,500 points.
Trade was heavy with turnover at 83.9 billion drachmas and 14,782,000
shares changing hands.
Demand was strong for banking stocks, which gained 6.44 percent.
The day's close was the highest since August 26, and the market has gained
73.7 percent since the beginning of the year.
The FTSE/ASE-20 blue chip index gained 4.93 percent to finish at 1,606.73
The parallel market for smaller cap stocks closed 2.03 percent higher.
Sector indices recorded gains across the board.
Of 263 shares traded advances led declines at 212 to 33 with 18 unchanged.
Panafon to join bourse's FTSE/ASE-20 index
Panafon, the mobile phone operator that made its trading debut yesterday,
is to enter the FTSE/ASE-20 index for blue chips and heavily traded stocks,
the Athens Stock exchange said.
The share, which gained 26 percent in heavy trade, will join with a 15
percent free float on January 7, ASE said in a statement.
The decision was based on the fact that Panafon's equity has a wide share
distribution and its market capitalisation represents more than 1.5 percent
of the index's capitalisation, the statement said.
The stock to leave the index in order to make way for Panafon will be
announced on January 5, it said. The loser will be the share with the
lowest market value on the index.
National Bank of Greece chief sees EMU entry close at hand
Greece is on the verge of attaining economic targets that will allow entry
into European economic and monetary union by January 1, 2001, National Bank
of Greece governor Theodoros Karatzas said yesterday.
"We are a stone's throw away from meeting EMU entry criteria," Mr. Karatzas
told a conference on the economy held by the Hellenic-American Chamber.
Mr. Karatzas also pointed out that the stock market had made a healthy
contribution to the economy.
The Athens Stock Exchange's capitalisation at the end of October stood at
more than 58 billion dollars despite a global financial crisis that
battered markets, up from 34.7 billion dollars at the end of 1997.
The Athens bourse had also posted a higher rate of growth than other
markets in Europe and worldwide, Mr. Karatzas said.
He said both increases in quality and quantity were needed for the capital
market, which would aid the economy to mature further.
NAPC lays-off entire workforce
North Aegean Petroleum Co. (NAPC) yesterday forwarded termination notices
to its entire workforce, sparking vehement protests among the 400 employees
at the Prinos off-shore oilfield in the northern Aegean.
The notices were sent despite Labour Minister Miltiadis Papaioannou's
pledge two days earlier that the government was willing to contribute 700
million drachmas to help fund voluntary retirement for around 70 workers.
Citing financial woes and low production, NAPC said it would close its
installations, located off the northern Aegean island of Thassos and
southeast of the town of Kavala, if workers persisted in rejecting the plan
to lower operating costs by 30 per cent.
EU foreign ministers' council agree on text for Vienna summit
The council of European Union foreign ministers reached an agreement in
Brussels late last night on conclusions that the "15" will forward to the
EU Vienna summit, scheduled for this weekend. Alternate Foreign Minister
George Papandreou, who represented Athens, said that the final draft is
satisfactory for Greece, as it differentiated between Turkey and other EU
candidate-countries of central and eastern Europe and Cyprus. The last
amendment agreed upon in the text was that a separate paragraph was used
for the 11 candidate-countries and another for Cyprus.
The final communique mentions that the FMs' council underlines that Ankara
should make special efforts to establish a democratic society in accordance
with the Copenhagen summit criteria and other EU council conclusions.
Russia's Zyuganov due in Athens
The president of the Russian Communist Party's central committee, Gennady
Zyuganov, will visit Athens tomorrow and Thursday at the invitation of the
Communist Party of Greece (KKE).
Mr. Zyuganov will meet with leading KKE officials, and other political
figures during his visit. He will hold a news conference on Thursday.
Thessaly-area farmers gear for mobilisations
The government's policy on the issue of agriculture is one of working out
problems through dialogue, acting government spokesman Nikos Athanassakis
said yesterday, ahe-ad of a planned protest by farmers today. Thousands of
farmers, mainly from central and northern Greece are expected to attend
today's rally in Larissa to protest the government's agricultural policy
and to press demands.
Mr. Athanassakis told reporters that Agriculture Minister George Anomeritis
had not rejected any meeting with the farmers, saying reports to the
contrary were "a misunderstanding".
"Mr. Anomeritis has begun wide-ranging talks with all agencies in the
agricultural community, both established and otherwise. The door is open,"
The spokesman admitted there were issues in the sector that needed
resolution and that the government was applying policy on a case-by-case
basis, in line with the provisions applicable for the European Union and
"They don't need to take the most dissatisfying course (blocking national
roads). We hope that these protests will not be disruptive to others," he
Large-scale protests by farmers last year - against new tax laws, in
support of demands for cheaper fuel and higher prices for their products -
caused unprecedented chaos in Greece, hampering road and rail transport
between the north and south, preventing lorries from delivering vital
supplies and on occasions forcing factories to shut down due to shortages
of fuel and raw materials.
Hundreds of farmers and more than 70 tractors rallied in the central town
of Farsala, near Larissa, in early November, to warn the government they
were prepared to block roads again this year if their demands were not
The rally was organised by the Federation of Farming Associations, with the
support of the Thessaly Coordinating Committee, the force behind extensive
farmers' protests last year.
Farmers are now demanding a higher production ceiling for cotton crops and
government intervention in Brussels to prevent what they claim will be a 30
per cent reduction in cereal crop prices this year if the European Union
does not alter its regulations.
Clouds with rain are forecast today throughout the country, with storms at
the Aegean and snow in central and northern Greece. Winds will be variable,
moderate to very strong. Athens will be overcast with rainfall or sleet.
Snow is expected in the mountains around Athens and possibly in the
northern suburbs at night with temperatures ranging from 5C to 9C.
Thessaloniki will also be cloudy, with sporadic snowfall, and temperatures
ranging from 0C to 5C.
Tuesday's rates (buying) U.S. dollar 279.714
British pound 463.165 Japanese yen (100) 232.951
French franc 49.673 German mark 166.567
Italian lira (100) 16.832 Irish Punt 413.862
Belgian franc 8.076 Finnish mark 54.808
Dutch guilder 147.828 Danish kr. 43.819
Austrian sch. 23.684 Spanish peseta 1.959
Swedish kr. 34.266 Norwegian kr. 37.484
Swiss franc 203.439 Port. Escudo 1.625
Aus. dollar 172.320 Can. dollar 182.230