Cyprus Mail: News Articles in English, 98-09-30

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From: The Cyprus Mail at <http://www.cynews.com/>

Wednesday, September 30, 1998

CONTENTS

[01] Corruption charges 'make us look like a banana republic'

[02] Auditors swoop on Michaelides home

[03] Cyprus Airways seeks to join global airline alliances

[04] Police believe flyaway parrot sparked bomb attack

[05] Campaigners step up action against nuclear plant

[06] Clerides returns saying US has not given up

[07] Denktash off to New York

[08] Minister promises help for Aradippou road misery

[09] Limassol taxis strike

[10] Fishermen bag 50 dead sheep

[01] Corruption charges 'make us look like a banana republic'

CORRUPTION allegations involving leading politicians are giving Cyprus the reputation of a banana republic, President Clerides complained on his return from New York yesterday.

"What I have to say, and I say with emphasis, is that we appear like a banana republic," Clerides told reporters at Larnaca airport, referring to media interest in the biggest corruption scandal to rock the island.

He seemed visibly annoyed by the latest allegations linking Diko leader Spyros Kyprianou with unlawful enrichment.

"We have lost all seriousness. Is there no way a politician can own two pieces of land, or even one, or even a house?" he asked.

"It is one thing to submit evidence and ask for it to be investigated, but it is another thing to continually discuss the matter before the investigations have been completed."

Kyprianou also reacted angrily yesterday to allegations that his family acquired three plots of land in Engomi, Nicosia at around 40 per cent below the market value.

A lead article in Machi newspaper had alleged that land reportedly bought by Kyprianou's two sons was acquired for £27,000 a plot when the Land Registry Office estimated its value at £45,000 each.

The paper implied that this evidence was dug up by House Watchdog Committee chairman Christos Pourgourides during his investigations against Interior Minister Dinos Michaelides, whom he accuses of corruption.

Although not naming names yesterday, Kyprianou said the article was part of a conspiracy to blacken his character and divert attention from the real culprits.

"It is an effort to slur my name or an effort to create a different picture to help those who are in a difficult situation: it is a cheap shot," Kyprianou told reporters.

"I want to make it quite clear that I am in favour of complete transparency, and if anyone thinks they can influence me in taking part in a cover-up they can forget it."

Kyprianou said he would make public his sources of wealth to prove his hands were clean.

Disy deputy Christos Pourgourides was in no doubt who planted the story in Machi and why: "Machi has stubbornly supported Dinos Michaelides throughout," said Pourgourides, dispelling any suggestion that he planted the story himself.

"It is not in my character to leak stories to the press, and if I decided to do such a thing it definitely wouldn't be to a paper which insults me day and night."

As far as the deputy was concerned, involving Kyprianou's name was a veiled threat warning him not to support any corruption probe against the government.

"This is part of a plan which I can only describe as a form of blackmail in order to apply pressure on Diko not to investigate corruption," he said.

Pourgourides also made clear that none of his allegations was directed against or meant to implicate Kyprianou or any member of his family.

He said that if his attempt to clean up political life was not given widespread support then the public would continue to distrust politicians.

"The public has never trusted politicians, he said. "The word politician has become synonymous with liar."

Apart from 14 allegations of bribery and corruption against Michaelides, Pourgourides has also raised the issue of dubious party funding.

In his wider anti-corruption campaign in public life the House Watchdog Committee chairman claims that one Disy member and a Diko official have both benefited from unlawful enrichment.

Disy's party executive met yesterday to allow Pourgourides to brief it on his latest allegations concerning one of its own members.

Wednesday, September 30, 1998

[02] Auditors swoop on Michaelides home

STATE auditors yesterday descended on the luxury Limassol home of Interior Minister Dinos Michaelides as part of a corruption probe into his financial dealings.

A team of officials headed by Auditor-general Spyros Christou arrived at the minister's house in the upmarket Kalogerou area of Yermasoyia, Limassol, at 1.10pm.

The purpose of the visit was to catalogue the size of the house and surrounding property, and the materials used to build it.

"Our aim is to estimate the value of Michaelides' residence, because Pourgourides claims it cost £600,000," Christou said yesterday.

He said his officials were only interested in immovable property, and not in the actual contents of the house.

Michaelides arrived half an hour before the Auditor-general in order to accompany the officials around his home, but was less than pleased about the intrusion.

"This is not the happiest day of my life, but it's about the truth coming out and I will get through this torment with my family," Michaelides told reporters.

Suspicions over how the minister had got the money to build his house were raised when Disy deputy Christos Pourgourides mentioned the Yermasoyia residence 10 days ago in his initial list of 14 allegations of corruption against Michaelides.

Pourgourides claimed Michaelides had built the huge luxury mansion, valued at over £600,000, without needing to take out a loan.

According to the deputy, this is just one example of how the minister allegedly abused his position to accumulate wealth and property estimated at a total value of over £2 million.

When the allegations were first made public, Michaelides denied his residence could be termed a mansion or that it was worth as much as £600, 000.

Michaelides told a press conference on September 18 that his home was worth around £250,000.

Michaelides also said that he had built the house - with money received from selling inherited property - in 1990, three years before he became Interior Minister in the Clerides government.

His previous stint as Interior Minister was between 1985 and 1988, under then president Spyros Kyprianou.

While state officials were examining the minister's house, a second team of investigators was sent to check another Pourgourides allegation - that a road had been narrowed to bypass a garden owned by the minister's wife.

The deputy claims that a road widening project in Limassol's Mesa Yitonia took a diversion when it came up against a house owned by the minister's wife.

The Christou probe into the Pourgourides allegations - ordered by Clerides - is expected to be completed by the end of October.

Wednesday, September 30, 1998

[03] Cyprus Airways seeks to join global airline alliances

ITS WINGS clipped by spiralling costs and intransigent unions, Cyprus Airways now says it is looking for a future in the black through partnership with foreign carriers.

The loss-making company yesterday revealed that it had started contacts with European carriers, which it did not name. The airline is seeking to join one of the emerging global airline alliances in the hope of returning to profitability by becoming more competitive and gaining wider access to markets.

Addressing a news conference, chairman Takis Kyriakides said the carrier was expected to return a profit for the whole of 1998, ending two years of losses which opened Cyprus Airways to scathing criticism and brought its management under public scrutiny.

He said the company, in line with suggestions made by a strategic plan touted as something of a certain route to commercial success, was also prepared to sell up to 17 per cent of the airline to a foreign carrier.

The hoped-for buyer would be a member of any of the alliances that 51-year- old Cyprus Airways eventually chooses to join.

The government owns 80 per cent of Cyprus Airways, while the remainder is traded on the Cyprus Stock Exchange. Under bourse regulations, the government must reduce its stake in the company to 70 per cent by March. The strategic plan, compiled last year by foreign consultants, however envisages a government ownership of no more than 51 per cent.

The desire to offer a slice of the company to a "strategic investor" has been floated for over a year now, but no foreign airline is publicly known to have come forward as a serious buyer.

But yesterday's disclosure that Cyprus Airways hoped to join one of the world aviation alliances and sell a slice of its share capital to a fellow alliance member constitutes a new development in the company's efforts to become an investor's dream.

Cyprus Airways already has co-operation agreements with Russia's Aeroflot, KLM of the Netherlands and Alitalia, but seeking to join a global alliance goes much further.

The company, which employs nearly 2,000, would be buying into the belief of major airlines that corporate travellers are increasingly demanding to buy tickets to any destination from a single source.

Carriers seeking to meet this rising demand by combining route networks are often unable to merge because of regulatory restrictions on foreign ownership in force in most countries.

In one of the major emerging airline pacts, Hong Kong-based Cathay Pacific earlier this month joined British Airways and American Airlines in a worldwide alliance that has yet to receive regulatory approval.

It is expected to also include Japan Airlines, Qantas of Australia and Iberia, the Spanish carrier, and will be up against competition from the six-airline Star Alliance headed by United Airlines of the United States and Lufthansa of Germany.

Other alliances which have taken shape recently are between KLM and Northwest Airlines of the United States and between Swissair and Delta, also of the United States.

"We are talking to several companies and want to hope that we will have a clearer picture of the situation in the next few months," Kyriakides, the Cyprus Airways chairman, said yesterday.

"We would have a global network and offer clients a broader range of scheduled flights. It would also upgrade the services on offer and help reduce the cost of fares," a senior Cyprus Airways source was quoted as saying yesterday.

Management-union relations in Cyprus Airways are often sour and fraught with distrust.

Reports of ill-advised management decisions further taxing the company's finances often make headlines in the local media, with extreme examples becoming almost synonymous with bad management.

The strategic plan recommends the free allocation to staff of six per cent of shares and the offer of a further six per cent at discount rates in return for agreement to wage cuts of up to 10 per cent and a three-year pay freeze. The unions have rejected the offer.

In yesterday's news conference, the carrier announced pre-tax losses of £3.4 million for the first six months of 1998, down from the 9.6 million of the corresponding period last year.

Kyriakides blamed the results in part on higher labour costs from previous commitments to staff under collective working agreements, but added that some operational costs had been cut through the reduction of overseas staff and the cancellation of unprofitable routes.

He said the company was examining with Olympic Airways a reduction in fares on the busy route to Athens and that, generally, Cyprus Airways would not hesitate to "reduce fares where necessary."

He also reported a 12.2 per cent increase in passenger load by Cyprus Airways and its sister charter company EuroCypria in the first six months of 1998 compared to the corresponding period last year.

Wednesday, September 30, 1998

[04] Police believe flyaway parrot sparked bomb attack

A BOMB attack in Limassol early yesterday morning has nothing to do with cabaret turf wars or underworld rackets, police believe.

In fact, this row is thought to have been sparked by a parrot.

Police say a home-made bomb exploded at around 3am under a pick-up truck belonging to Pachna upholsterer Andreas Evgenios Pachniotis.

The vehicle was parked outside his shop, above which he lives, and the blast caused damage to both the vehicle and the shop windows.

Acting on information given to them by the victim, police arrested Costas Sofroniou Cleanthous, 51, and his unemployed son Vladimir, 20.

Limassol district court yesterday remanded them for eight days to help police with their enquiries.

Pachniotis apparently told police he had become involved in a fight with Cleanthous and his son over his parrot, which had gone missing from its cage.

He said the bird had been spotted at the suspects' house, and instead of trapping it and returning it to him, they had set it free.

Witnesses said that at the time of the altercation, Vladimir had warned Pachniotis not to argue with him and his father because "we put bombs".

The parrot's current whereabouts are unknown.

Wednesday, September 30, 1998

[05] Campaigners step up action against nuclear plant

LOCAL greens are being urged to join an international campaign to protest against Turkey's plans to build a nuclear reactor on its southern coast.

At a conference in Greece attended by Cypriot environmentalists on the impact of the proposed plant at Akkuyu, which lies just 250 kilometres from Nicosia, green groups said a call to arms was needed to prevent such a catastrophe.

The international environmental group Greenpeace has already taken up the issue.

David Martin, a research director of the Canadian-based environmental organisation Nuclear Awareness Project, told the Cyprus News Agency (CNA) that the issue had to be taken seriously.

"What we are trying to do now is to organise an international petition campaign that will be from the people of Turkey, the people of Greece, Cyprus as well as Germany and France and will aim at the French, Canadian and German governments," Martin said.

Voices have also been raised that Turkey could have its eyes on obtaining plutonium 239 - a key ingredient for an atomic bomb.

Experts say the plant lies in a seismically sensitive area, and an earthquake like the one that occurred in Turkey last June, just 136 kilometres east of the site, could have catastrophic consequences on Turkey and its neighbours. June's quake measured 6.3 on the Richter scale.

Criticism has also been levelled at the Canadian reactor design, CANDU, and efforts are afoot to orchestrate a campaign against the sale.

"The CANDU reactor design is such that severe shaking produced by a quake will cause the break in the main heat transport... It is quite irresponsible of Canadians to support a proposal that has the potential to destroy millions of lives," said Karl Buckthought from the Canadian-based Earthquake Forecasts inc.

The announcement of the winning tender is overdue and could be delayed until after elections in Turkey in April 1999. A further six months might also be available while contracts are being drawn up and signed.

"We have a window of opportunity now that if we mobilise quickly and if we speak with a loud enough voice, we really can stop this crime against humanity," Martin said.

Wednesday, September 30, 1998

[06] Clerides returns saying US has not given up

PRESIDENT Glafcos Clerides yesterday returned from his 10-day visit to New York, where he was attending the UN General Assembly.

Speaking on his arrival, Clerides spoke of developments in the Cyprus Problem and moved to quash rumours that a US deal to cancel the controversial S-300 missile deal was in the offing.

Regarding the impact his New York meetings might have on developments in the Cyprus Problem, Clerides simply said UN Secretary-general Kofi Annan was "studying some proposals, which are not ready to be announced yet".

Adding that the contribution of political party leaders accompanying him to New York had been "excellent and productive", he said: "we have agreed that the results will be taken before the Council of Ministers, which I will call on October 9 and decisions will be taken there".

On American efforts to break the current deadlock, the president said he was convinced that "they are continuing to try".

This, he said, was demonstrated by the fact that "not only the United States, but all the permanent members of the Security Council, through their Foreign Ministers... attended a meeting where all the Foreign Ministers, and (US Secretary of State) Madeleine Albright, made an announcement calling on both sides to continue or to begin intensive negotiations based on the votes of the Security Council."

"And we all know what the Security Council votes are about," he added.

Clerides underlined that the Foreign Ministers' announcement came after separate meetings with Turkish Foreign Minister Ismail Cem and Prime Minister Mesut Yilmaz, who, "of course, also saw the permanent members and tried to convince them that the only solution is the one proposed by Mr Denktash."

Denktash recently said the only way forward on the Cyprus problem was for "two sovereign states" on the island to enter into a confederal agreement. UN Security Council resolutions call for a bi-zonal bi-communal federation with a single sovereignty.

Answering a question on the S-300 missiles, Clerides noted that his address to the UN on the subject had included the phrase that "the delivery of the missiles will only be cancelled if negotiation starts and if the progress of the talks is jeopardised" by the deployment of the missiles.

And on rumours that the United States had prepared a proposal with Cyprus to scrap the missile deal, Clerides replied: "I also read that in the papers and it surprised me."

He said nothing of the kind had been raised in his meetings, "either by (US State Department Cyprus co-ordinator Thomas) Miller or by (US presidential envoy Richard) Holbrooke."

Wednesday, September 30, 1998

[07] Denktash off to New York

On his departure, Denktash said that the aim of his visit was to "disperse the adverse atmosphere created" by President Glafcos Clerides, who has just returned from a ten-day visit to New York.

He went on to claim that Clerides had used a tactic of agreeing to everything he knew the Turkish Cypriot side would reject. "What are we saying 'no' to?" he asked. "We are saying 'no' to fraudulence".

He said the Turkish Cypriot side had decided to insist on "inter-state" relations after seeing through the Greek Cypriots' "deception".

He continued that the Greek Cypriot side had made it seem that "Denktash did not want unification" and that "Turkey will annex Cyprus". It was the, he explained that he put forward his idea of confederation, to prove that "reunification is possible through the acceptance of two states."

As well as Annan, Denktash is due to hold talks with US presidential envoy Richard Holbrooke today.

Wednesday, September 30, 1998

[08] Minister promises help for Aradippou road misery

Local protesters on Saturday blockaded the Nicosia to Larnaca highway in protest at roadworks they say are wrecking the community.

Residents of the Larnaca village say a new junction in the extension of the highway obstructs access to shops, houses and farming areas.

Ierodiakonou yesterday promised that a £100,000 government loan would be given to the municipality as a first step to completing work and reopening service roads providing access to areas that are currently cut off.

The Ministry of Communication and Works also announced that another part of the Nicosia to Larnaca highway would be opened on Friday.

The new stretch runs from the Kalo Chorio roundabout to the Peletiko roundabout and Zapata Avenue that runs behind Aradippou's industrial area.

Traffic lights will operate at the junction of the highway with Zapata Avenue.

The opening of this £4 million stretch leaves only one more part of the highway to be completed, from Larnaca Airport to the Rizoelia area.

Wednesday, September 30, 1998

[09] Limassol taxis strike

Three hundred and eighty taxi drivers switched off their meters after an emergency meeting of their local association decided on the action at a Monday night meeting.

The association's president, Christos Panayiotou, said the eight taxis, which are licensed to operate in the rural town of Pareklisia, had been given licences to operate in Limassol just because the licensing department thought there should be more cabs in the city.

He added that Limassol taxi drivers had suffered huge losses over the past four years because of a decline in custom and because of never ending roadworks in the town.

The taxi drivers have sent a letter of protest to the licensing authority, and have said that if their demands are not met, further disruptive action will follow.

The 24-hour strike was a "warning", Panayiotou told reporters.

Wednesday, September 30, 1998

[10] Fishermen bag 50 dead sheep

After the fishermen told harbour police about the dead animals, they were asked by Fisheries Department officials to tow the bodies in for burning.

The sheep are thought to have been thrown overboard by a passing ship.

© Copyright Cyprus Mail 1998

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