Athens News Agency: News in English (AM), 99-04-01

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

NEWS IN ENGLISH

ATHENS, GREECE, 01/04/1999 (ANA)

MAIN HEADLINES

• Simitis emphasises need for political solution to Kosovo
• Central bank sees inflation around 2.0 pct by mid-summer
• Gov't anxious over economic impact of lasting Kosovo crisis
• Stocks slump on Kosovo woes
• Foreign currency market edgy, bonds steadier
• Flags of convenience have failed, minister says
• Attica Enterprises orders two more 'superfast' vessels
• Tsohatzopoulos: Any change of Balkan borders inconceivable
• Tirana says it would safeguard ethnic Greeks' properties
• China's Li Peng holds talks with Greek leadership
• Greek-Armenian agriculture cooperation
• Weather
• Foreign exchange

NEWS IN DETAIL

Prime Minister Costas Simitis yesterday reiterated during an address in Parliament the need for diplomatic initiatives and a political resolution to be found for the Kosovo crisis.

Addressing a special session convened to discuss developments over Kosovo, he said Greece should not at the current moment resort to actions or options in the "heat of the moment", saying such an event will have disastrous consequences for Greece's future.

He advised cool-headedness, alertness and decisiveness, all elements of a "responsible and developed country of the European system, (a country) standing at its neighbours' side," as he said.

Mr. Simitis noted that Greece insisted on respect for the principles of human and minority rights, respect for the territorial integrity of countries, the inviolability of borders and the peaceful resolution of differences on the basis of the United Nations charter.

"Referring to those principles is not rhetorical for Greece, which lives under Turkey's aggressive behaviour in the Aegean and the continuing international crime of the Turkish occupation of a major part of Cyprus," he added.

The Greek PM again supported expanded autonomy to Kosovo, but strictly within the borders of Yugoslavia and with total respect for human rights for all communities in the province.

"In this framework, Greece has made clear in every direction that will not participate in military operations in the region," he said.

Main opposition New Democracy leader Costas Karamanlis said he would like the Greek position on developments in the Balkans to be more "determined and clear".

"Instead of curbing the crisis, the superpower (US) is tending to widen it, while the European Union is being dragged instead of leading. It is not the Europe we have envisaged, but a Europe of accountants. It has disappointed and is disappointing," he said.

Mr. Karamanlis said that in the face of this situation, Greece should have processed proposals which it should have put forward steadfastly and with determination, especially after the Berlin summit. However, he said, it is never too late for a Greek in itiative.

He said Greece should have explained to its partners that respect for human rights is an inviolable condition for inter-state understanding, but not at the expense of peace and stability.

Communist Party of Greece (KKE) Secretary General Aleka Papariga called on the government to withdraw its signature from NATO's intervention (in Kosovo), leave aside its ostrich policy and not participate in extortions for the Rambouillet agreement to pass.

Coalition of the Left and Progress leader Nikos Constantopoulos proposed the adoption of a unanimous resolution on the part of the Greek Parliament on a condemnation of NATO bombings of Yugoslavia.

Democratic Social Movement (DHKKI) leader Dimitris Tsovolas criticised the US, saying that "it is playing the absolute role of judge and gendarme."

Central bank sees inflation around 2.0 pct by mid-summer

The Bank of Greece forecast that inflation will drop to around two percent by mid-summer at the latest, but warned that the rate must be maintained in order for convergence with the European Union to be feasible.

Lucas Papademos, the central bank's governor, yesterday submitted to parliament his six-monthly report on monetary policy for 1998 and 1999.

Replying to a reporter's question, Mr. Papademos said that the Yugoslav crisis would have no direct repercussions on the economy if it was fairly short-lived, but some edginess was likely.

Mr. Papademos also said the Bank of Greece had the means, including foreign currency reserves, to support the national currency if it came under new pressure.

Expressing optimism on meeting EU convergence criteria, he said the purpose of this year's monetary policy was to achieve price stability at a rate that did not exceed 2.0 percent.

According to the bank's report, monetary policy again would be tight in 1999.

In order to further aid the decline in inflation, the central bank would keep the drachma high against its central parity in the European Union's exchange rate mechanism.

The factors that could hurt the decline in inflation were oil prices; new international market crises coupled with an anticpated slowdown in the global economy; and the absorption in the inflation rate of cuts in indirect taxation, which could lead to a small rise in the rate.

Gov't anxious over economic impact of lasting Kosovo crisis

National Economy and Finance Minister Yiannos Papantoniou yesterday expressed his concern over the impact on the economy of prolonged military operations in Yugoslavia.

Mr. Papantoniou pointed to difficulties in implementing the government's current economic policy linked to duration of the crisis and any mass influx of refugees.

Speaking during a press conference, he said that there were fears that a crisis in Kosovo could hit European and global economies and in particular financial markets, a prospect that would indirectly affect the country.

Beyond any national or economic factors, Greece therefore had more general reasons for seeking an end to military operations in Yugoslavia and resuming the peace process, he said.

Mr. Papantoniou referred to Europe's "inability to have its own polical say" on Yugoslavia. Europe was a "political dwarf" compared to the United States, he said.

The minister said that developments in Yugoslavia would not have any direct impact on the economy, and in particular exports towards western Europe, which had been transported via Italy since the break-up of the former Yugoslavia.

He said Greek tourism was not affected by the crisis and that hotel reservations had increased in the last few weeks.

A new round of structural changes in the economy would start after national elections due in 2000, Mr. Papantoniou said.

Turning to the labour market, he noted that the government had already implemented a new framework for labour relations and that there were no plans to change the law.

Mr. Papantoniou also urged companies to support the government's effort to reduce inflation to the Maastricht criterion of 2.0 percent by the end of the year.

Stocks slump on Kosovo woes

Equity prices ended sharply lower yesterday hit by fears over the crisis in Kosovo following an unsuccessful diplomatic initiative by Russia to end NATO's bombings.

Traders said investors largely ignored a favourable report by the European Commission on the Greek economy that paves the way for the country's participation in the euro zone.

In addition, they appeared to brush off estimates by the World Bank that the country's economic strength would accelerate foreign capital inflows to the Athens Stock Exchange in coming months to an estimated 3.6 billion dollars.

The general index ended 3.84 percent off at 3,376.37 points. It showed a 0.04 percent decline in March.

The market has lost 10.19 percent since the start of NATO air strikes in Kosovo.

March's turnover totalled 3.8 billion drachmas, up from 2.7 billion in February.

Turnover yesterday was 141.543 billion drachmas and volume 21,194,203 shares.

The FTSE/ASE 20 index fell 3.73 percent to 2,093.86 points.

National Bank of Greece ended at 20,450 drachmas, Alpha Credit Bank at 20, 070, Ergobank at 22,600, Ionian Bank at 21,804, Titan Cement at 23,000, Hellenic Petroleum at 2,360, Intracom at 17,600, Minoan Lines at 7,000, Panafon at 7,850 and Hellenic Telecoms at 7,335.

Foreign currency market edgy, bonds steadier

The foreign currency market was jittery yesterday on Kosovo fears but bonds were unscathed after buying interest replaced early profit-taking, taking prices around 20 basis points higher.

The latest 10-year bond was at 102.90. The yield spread between the paper and Germany bunds fell to 1.90 percent from 1.92 percent a day earlier.

Electronic trade was 53 billion drachmas from 93 billion drachmas in the previous session.

In the foreign currency market, robust demand was seen for euros in morning trade.

At the central bank's daily fix, the euro ended at 325.950 drachmas from 325.300 drachmas in the previous session.

Flags of convenience have failed, minister says

Flags of convenience have proved to be unsuccessful and raising the Greek flag is in the interests of shipowners, Merchant Marine Minister Stavros Soumakis said yesterday.

He was commenting on a joint statement by the Greek Shipowners Union and London-based Committee on Monday criticising the government's merchant marine policy.

Mr. Soumakis underlined the state's support for the maritime industry and for the welfare of Greek sailors.

He also noted that the Greek shipping registry had increased last year, and its members were making continuous efforts to modernise their fleets.

The minister said that plans to list Greek shipping companies on the Athens Stock Exchange would have to be carefully examined to ensure the Greek merchant marine's credibility, and meetings on the issue would be held this week.

Attica Enterprises orders two more 'superfast' vessels

Attica Enterprises yesterday announced the signing of contracts for the building of two new "superfast" ferries with the Howaldtswerke Deutsche Weft (HDW) shipyards in Kiel, Germany.

The group's orders amount to six vessels in all (four have already been ordered) whose delivery will start in the first half of 2000 and will be completed in 2001.

The company said the investment totals US$650 million. Financing for the six ships has been agreed with the German bank Kreditanstalt fur Wiederaufbau (KfW).

Attica Enterprises is already using four superfast ships on the Greece- Italy routes.

Tsohatzopoulos: Any change of Balkan borders inconceivable

National Defence Minister Akis Tsohatzopoulos begins a tour of Balkan capitals today in an effort to search for ways the region's countries can contribute to a solution of the Kosovo refugee problem.

He will visit Bucharest, Sofia and Skopje, in that order.

Mr. Tsohatzopoulos stated yesterday that Greece was prepared to provide humanitarian assistance to Yugoslavia - regardless of the fact that the neighbouring country had not yet sumbitted a relevant request - and accept a limited a number of refugees, as the objective was for them to remain near their homes with a view to returning when a solution was found.

Regarding NATO bombings of Yugoslavia, he said in no phase did planning envisage the deployment of ground forces, while he expressed a view that this would not happen.

"NATO forces stationed in the Former Yugoslav Republic of Macedonia (FYROM) arrived there for the protection of the OSCE observers that were in Kosovo, and to supervise a possible peace agreement - if and when there was one - with the guarantees of the international community," he said. He reiterated that Greece was not participating in the military operations against Yugoslavia, which he predicted would not lead to the desired result.

"Greece supports any initiative aimed at a political solution of the problem, which is the only feasible one," he said.

Furthermore, he described as most unfortunate references to a possible Greek-Turkish conflict as a result of the Kosovo crisis. Finally, he emphasised Greece's vehement opposition to any change of borders in the Balkans.

"Any deep-seated thought for a change of borders in the Balkans in the name of minorities' rights is inconceivable, as this would open the doors and windows to blow the Balkans sky-high, but also the entire security edifice in Europe," he warned.

Tirana says it would safeguard ethnic Greeks' properties

Foreign Minister George Papandreou yesterday expressed satisfaction with the Albanian government's commitment that the sheltering of Kosovo refugees will in no way affect properties belonging to the ethnic Greeks in the neighb ouring country.

He made the statement after a meeting with Albanian Prime Minister Panteli Majko, and during a brief visit to Tirana.

Mr. Papandreou also expressed Athens' full solidarity with the Albanian government during the present difficult phase.

"The problems which Albania is facing from the influx of more than 100,000 refugees are serious, and urgent solutions are needed to secure the country's stability," he said.

Mr. Papandreou accompanied the first shipment of Greek humanitarian aid for the refugees, consisting of 20 tons of foodstuffs, 20 prefabricated houses, two ambulances, pharmaceuticals and blankets for 5,000.

Mr. Papandreou said he stressed to Albanian President Rexhep Mejdani, whom he also met, that the Greek government's standing position, in line with that of international organisations, was that refugees should remain as close to their homes as possible.

After his contacts with Albanian officials, Mr. Papandreou called on Archbishop of Tirana and All Albania Anastasios, who told reporters that the Church had already sent urgent humanitarian aid to refugees from Kosovo, with more following.

In Athens, government spokesman Dimitris Reppas revealed earlier that Prime Minister Costas Simitis spoke yesterday with his Albanian counterpart Panteli Majko asking him to safeguard the property belonging to the Greek minority in the southern part of that country and requested these rights not be harmed in the process of relieving the plight of the Kosovar refugees.

Many of the ethnic Greeks from Albania are working and residing in Greece, in the wake of financial and social turmoil in Albania over the past few years.

Mr. Majko assured the Greek prime minister that the refugees heading to the south would not harm the interests of the Greek minority.

China's Li Peng holds talks with Greek leadership

The president of the People's National Assembly of China, Li Peng, held successive contacts with President Kostis Stephanopoulos and Prime Minister Costas Simitis yesterday.

Mr. Peng is currently in Greece on an official visit at the invitation of Parliament.

Leading members of the People's Republic of China's political leadership will visit the island of Crete today and tomorrow. The Chinese delegation numbers 120 individuals and is headed by Mr. Peng. The National Assembly's Deputy President, Hi Luli, Deputy FM Ji Peiding and the presidents of National Assembly committees will be accompanying with Mr. Peng.

The Chinese delegation will arrive in Irakleio this afternoon. At 8:30 p.m. Mr. Peng will meet with deputies, the secretary general of the region of Crete and representatives of the local authorities.

Greek-Armenian agriculture cooperation

Greece and Armenia yesterday signed a cooperation memorandum in the agricultural sector, as Armenian Agriculture Minister V. Movsisad is currently on an official visit to Greece.

Specifically, some 5,000 tons of grain and 1,000 tons of fertilizers will be sent to Armenia as aid, while 20 scholarships to be given to Armenian students for training in Greece as well as an exchange of training missions and specialists.

WEATHER

FOREIGN EXCHANGE

Thursday's rates (buying)
U.S. dollar          301.469
Pound sterling       486.060
Japanese yen (100)   253.129
French franc          49.293
German mark          165.323
Italian lira (100)    16.699
Irish Punt           410.560
Belgian franc          8.015
Luxembourg franc       8.015
Finnish mark          54.382
Dutch guilder        146.727
Danish kr.            43.537
Austrian sch.         23.498
Spanish peseta         1.943
Swedish kr.           36.440
Norwegian kr.         38.781
Swiss franc          202.517
Port. Escudo           1.613
Aus. dollar          189.968
Can. dollar          197.487
Cyprus pound         556.452
Euro                 323.342

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