MILS NEWS 14/02/96

From: "M.I.L.S." <mils@MILS.SPIC.ORG.MK>

Macedonian Information Liaison Service Directory

CONTENTS

MILS NEWS

Skopje, 14 February 1996

[01] GLIGOROV - 'CONSTRUCTIVE SOLUTION WAS THE ONLY AIM OF MINE'

President of the Republic of Macedonia, Kiro Gligorov, yesterday again addressed the public, referring to the breakdown of the Alliance for Macedonia and to the proposed reconstruction of the Macedonian Government. He said:

'With much regret I must say that my appeal for a reasonable discussion and a compromise between the current partners in the Alliance for Macedonia was interpreted and understood differently. It was said that I had agreed with what was happening, that I have only publicly stated the opposite, that I said the Alliance for Macedonia must be preserved, etc. Instead reaching the only aim of mine: a constructive solution, the result was further strengthening of the clashes and complete separation of the partners. I now do not intend to arbitrate, as I remain on my view that each of them will be responsible for their actions and for the future. It is sad that the situation was presented as definite and that completely opposite statements were made.

That is why I would like to repeat now, as a President of all citizens of the Republic of Macedonia, I will continue to perform my function, based on the program presented at the election period. I do not want any misunderstandings to appear, about how everything happened and why was there such a persistence to reach such a result, which final will take place in the Parliament.'

[02] PARLIAMENTARY DISCUSSION ON THE NEW CABINET ON 21 FEBRUARY

Macedonian Parliament will held its next 39th session on 21 February 1996. The official announcement said that the proposal for the re-structuring of the Government and for appointing vice ministers have been added to the Agenda.

According to Macedonian Radio, this session was scheduled on 7 February this year. Since the proposal from Premiere Crvenkovski arrived several days later, the President of the Parliament stated he respects the Constitution, which is strict and can not be differently interpreted. It means that on the proposal for releasing a member of the Government, the Parliament decides on its next session, and the President of the Parliament is not above the Constitution, said Andov.

The Statute of the Parliament allows a possibility to convoke a session earlier than the one scheduled previously, in case the President decides it is necessary, and many envoys said it happened many times till now.

The coordinator of the SDSM envoy group, Tito Petkovski, said that the President of the Parliament was asked to convoke a session the very next day after the Premiere announced his proposal, so that the passive period in the functioning of the Government is avoided. Andov replied that the next session has already been scheduled and that he did not find it necessary to urgently convoke a new one.

[03] LIBERALS - 'PREMIERE CRVENKOVSKI HAS MISINFORMED THE PUBLIC'

'On the press conference held on Saturday, Premiere Branko Crvenkovski, following the announcement of his proposing list for a new Government, wrongly informed the public on a meeting with representatives of the Liberal Party' - is said in the yesterday's announcement of the Liberal Party. The announcement continues with the information that on the meeting of the Liberals with SDSM representatives, Premiere Crvenkovski simply rejected the appeal of President Gligorov for discussion. The reasons for such attitude, according to the announcement, were that he had gone too far and that he would not like to go back to the Central Committee of SDSM.

Premiere Crvenkovski, in fact, blamed the Committee for the breakdown of the Alliance of Macedonia.

The attitude of the Republic Committee of the Liberal Party is that neither the candidates suggested for the new Government, nor those for vice ministers, with few exceptions, participated in the creation of the electoral platform of the Alliance for Macedonia. On the contrary, there are candidates on the list who strongly oppose it, and some of them publicly presented ideas to change the Government and the system, despite the will of the electors.

It is the only explanation for Premiere's refusal to analyze the last year's work of the Government and the Ministers.

The Committee concludes that the Premiere has decided on some new platform, different and in contrast with the one of the Alliance for Macedonia, which has been created by President Gligorov. Liberal Party will maintain the platform of the Alliance for Macedonia and completely supports President Gligorov, as a person who is a representative of the platform, on which basis the voters accepted it.

As a conclusion, the Republic Committee of the Liberal Party said they do not support Premiere Crvenkovski as a candidate of the Alliance for Macedonia who will form a new Government, nor the lists of candidates he proposed. The envoys of the Liberal Party will present the reasons for this on the next session of the Parliament, ends the announcement.

[04] RAMADANI OF PDP - ' WILL ANDOV REMAIN A PRESIDENT'

'PDP would not mind if President Stojan Andov remains on its current position in the Parliament, but personally, I do not believe he will accept that after his Party becomes opposition' - said Ismet Ramadani, coordinator of PDP envoy group, for 'Nova Makedonija'. He pointed out some examples in foreign countries, where the President of the Parliament is an opposition member, but their roles are those of a speaker, while in our country the President of the Parliament is a deputy of the President of the Republic in the absence of the latter.

[05] GREEK LEFT WING FOR A COMPLEX NAME OF MACEDONIA

Greek Premiere, Constantine Simitis, convoked a session of the Government yesterday, when Greek-Turkish relations, the dispute on the name of Macedonia and the issue of Cyprus were discussed. Premiere Simitis discussed the disputes with Turkey and Macedonia with the leader of the Left Wing Coalition, Nikos Constandopoulos. According to Macedonian Television, Constandopoulos asked for the dispute with Macedonia to be settled as soon as possible and suggested that Greece accepts a complex name.

[06] EUROPEAN INTEGRATION FOR BALKAN COUNTRIES

During the visit of the Bulgarian Premiere Zan Videnov to Belgrade, his Yugoslav counterpart, Radoe Kontic, said that Belgrade intensely works on the normalization of the relations with former Yugoslav republics, and that many positive steps have already been made. As Kontic stated, Belgrade has problems with Bosnia and Herzegovina and with Croatia, which means that there are no problems with Macedonia and Slovenia.

The announcement of the Cabinet of FR Yugoslav President, Zoran Lillic, informed that on the meeting Lillic had with Videnov, they stressed the importance of the well developed relations of these two countries for the peace in the Balkans, and the mutual aim of theirs - to make the Balkans a zone of friendship and peace. The process of connecting the Balkan countries should open the road to the European integration, and mutual opening of the borders for people, goods and ideas, would contribute to the creation of a free trade zone in the Balkans, concludes the announcement.

[07] AGREEMENT ON THE TRANSPORT WITH HUNGARY

A delegation of Macedonian Ministry of Traffic and Connections will stay in Budapest today and tomorrow, when they should meet the representatives of the Hungarian Ministry of Transport. It is expected that they will initialize the text of the draft Agreement on Transport between the two countries. The current cooperation with Hungary, a country at the crossroads of the transport corridors in Middle Europe, in this area, was estimated by the Macedonian Ministry as satisfactory.

[08] MACEDONIAN SECURITIES MARKET WILL START ON 4 MARCH

Macedonian securities market will start its work on 4 March 1996. The future brokers have already been trained, and meetings with media representatives, citizens and entrepreneurs are being organized. Video materials and brochures are also being prepared, and the brochures will be allotted through the market members, post and public institutions. The General Manager of the market, Zografski, informed that some enterprises have already notified issuing bonds, which, added to the stocks of the Agencies for Rehabilitation of Banks and of Privatization, will provide the first market material to start with.

[09] JANUARY INFLATION OF 0.3 PERCENT

The inflation in Macedonia has increased in January for 0.3 percent in comparison with December 1995. According to the Statistics Institute, it is due to the increased prices of the agriculture products. The prices of food products have, on the other hand, decreased for 0.7 percent, and the prices of services have not changed. Prices in retail trade, i.e. the inflation in January 1996 is 5.7 percent higher than in January 1995.

MILS SUPPLEMENT

[10] Interest Rates - Care of The Government

('Nova Makedonija', 14 February 1996)

The agreeing on the interest rates policy of the banks within their Association remains open. Till the end of this month, each of the 22 business banks in Macedonia will present their readiness to (not) sign a certain regulation (a Contract or an Agreement) on the price of the capital in the following period. This was concluded on yesterday's meeting of the Executive Board of the Bank Association, in the frames of the Macedonian Chamber of Commerce. The Board called for the banks, the Government and the central monetary institutions to give their contribution in the reducing of the expenses, which are the reason why the interest rates can not be decreased under the current 25 to 28 percent. The aim is to have annual interest rate of 15 to 18 percent, but it is possible to be reached only with many measures for reducing the expenses in the work of the banks, and which will regulate the money circulation. The bankers especially stress their requirements for changes in the value added taxes - mostly the tax on services and the personal tax on the saving accounts. They also require attention to be paid to the mutual crediting of the enterprises, the 'gray' money circulation and the regulations protecting the debtors.

That is why it is still not clear whether the current practice of a guild agreeing on the interest rate policy will continue. The bankers are aware that the basic conditions for market determining of the interest rates have still not been established. There is no money market, and the capital market is being formed. Banks point out the danger from the uncontrolled increase of the rates, in case they are left to be determined by each bank independently.

Such a situation will go back to the situation of being unable to collect payment for the credits they have given.

There are also many open questions influencing the fact that the credit interest rates are much higher than the inflation rate (which was 9% in 1995, and is planned to be 6% for 1996).

'Despite the public statement of the Finance Minister, given several months ago, that the problem of the service taxes and personal taxes on the saving accounts will be solved, these promises have not been fulfilled', said Aco Spasovski from the Macedonian Chamber of Commerce. He added that the Law on Executing Procedure is still being prepared, which is a condition for overcoming the current absurd situation that protects the debtors. Namely, bankers say that many clients use the bad regulations and do not pay their credits. As Zoran Trpevski, the General Manager of the Macedonian Bank, said, the legal procedure for forced payment collecting is very long, and the court often give verdicts in favour of the debtor. Following the suggestion of the Vice Finance Minister, Dragoljub Arsovski, the bankers decided to form a special working group, with per one representative in the Economy Bank, Commercial Bank and Macedonian Bank, who will prepare a draft Law on the Executing Procedure. This might help the current situation to be overcame, as the Ministry of Justice has been postponing it for too long without any reason.

Milan Hrovat, Vice President of the Macedonian Chamber of Commerce, suggested certain regulations to be established for the interest rates policy within the Bank Association.

He added that it is necessary to analyze the factors that influence the current level of the rates, as it would help the public to better understand the reasons for the level of the interest rates, especially because of the opinion in public that the bank capital is too expensive. Hrovat presented the information that a much smaller part of the funds is in the banks, and the banks can use only 45 percent of them. The rest of the bank funds are obligatory reserves, which, added to other elements (such as putting the deposits in the National Bank of Macedonia), increases the bank expenses.

The Executive Board of the Bank Association also paid a great attention to the to the expected changes in the regulations referring to banks, to the national Bank and to the rehabilitation of banks. 'The Governmental Commissions already discussed these changes', informed Dragoljub Arsovski, 'and they are made with help from the foreign experts. They should also help us to be given the second part of the FESAK credit from the World Bank.'

Bankers presented their objections to the changes, mostly to the authorizations given to the Governor and the Council of the National Bank of Macedonia. They also objected to the wider possibilities of the Finance Ministry to interfere with their work, and to the changes that jeopardize the position of the stockholders. Namely, in order to maintain the status of a founder, the foreign depositors must make additional payments, while the current regulations do not require that. It was concluded that each bank will make their objections in written till the end of this week, so that they unite their suggestions and intervene before it is too late.

Bankers discussed on the transfer of the deposits of public enterprises from the business banks to the National Bank.

They estimated it additionally worsened the liquidity of the banks, and, besides economical, it is also a political issue. The information of the Association is that a part of the funds are being transferred, in contrast with the legislation, which jeopardizes the allocation of the funds and the areas where they come from.

(end)

mils news 14 February 1996