Cyprus Mail: News Articles in English, 98-12-22

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

Tuesday, December 22, 1998

CONTENTS

[01] Michaelides cleared: `No evidence to justify criminal proceedings'

[02] Finance Minister may quit for £60,000-a-year post

[03] Defence tax goes up

[04] Israeli spy suspects deny all charges

[05] 'Critical juncture' in the Cyprus problem

[06] Synod dismisses claims against Athanasios

[07] New think-tank set to start operations next year

[08] Embassy demo protests air strikes

[09] Armed robbers nab £38.50

[10] Two killed in weekend crashes

[01] Michaelides cleared: `No evidence to justify criminal proceedings'

EMBATTLED Interior Minister Dinos Michaelides has been cleared by cabinet- appointed investigators of possible criminal misdemeanours relating to alleged corruption.

"There is no evidence to justify criminal proceedings against the Interior Minister for either of the allegations investigated," Attorney-general Alecos Markides announced yesterday afternoon after spending the weekend studying the investigators' findings.

On November 21, Law Commissioner George Stavrinakis and Andreas Shiakas of the Auditor-general's office were appointed by the Council of Ministers to look into two of the 14 corruption allegations levelled at Michaelides by Disy deputy and House watchdog committee chairman Christos Pourgourides. An earlier investigation into all 14 charges by the Auditor-general's office led to 12 of them being dismissed as groundless.

The accusations investigated by Stavrinakis and Shiakas concerned alleged abuse of power at the immigration department and alleged unlawful enrichment through the sale of apartments.

Michaelides tendered his resignation after the two investigators were appointed but President Clerides chose not to accept it.

Markides said he, Stavrinakis, Shiakas, and state attorney Petros Clerides (who independently reviewed the investigators' report), had arrived at the same vindicating conclusion.

But Michaelides may not be completely off the hook yet. The unlawful enrichment claim proved totally without basis, Markides said, but investigators did find that the minister had, on at least five occasions, taken decisions concerning immigration issues without ever looking at the case files of the persons concerned.

While such actions did not constitute an offence, they might throw up a "political issue" concerning the minister's use of authority, Markides said. The Attorney-general added that such issues had not been within the remit of the investigators to decide and were not for him to comment on either.

Also, Markides said the minister was to be further investigated on two issues related to Pourgourides' accusations. One, concerning possible tax evasion, is to be looked into by the Income Tax office. The other investigation, to be carried out by Petros Clerides, concerns a report by the Technical Chamber (Etek) - submitted after the investigators were appointed - on the minister's involvement in land deals in the Sea Caves beauty spot outside Paphos.

Markides said it had not proved possible to probe Pourgourides' allegations that the minister had taken bribes to grant immigration department permits "as Mr Pourgourides did not divulge his source to investigators to enable them to make a start." Pourgourides refused to testify before Stavrinakis and Shiakas, labelling the probe a "sham."

Michaelides, who recently returned from extended leave in Greece, has always maintained his complete innocence.

Tuesday, December 22, 1998

[02] Finance Minister may quit for £60,000-a-year post

FINANCE Minister Christodoulos Christodoulou may leave the cabinet early next year to take up a job offer as director of the island's Association of Commercial banks. The job will reportedly earn the 59-year-old Christodoulou a handsome £60,000 a year.

"If I finally accept the offer that will be in a few weeks, and it will not affect my position (until then) as finance minister," he said yesterday.

Government officials meanwhile said that Christodoulou, who first took the finance brief in November 1994, was expected to remain in his post until the House ratified the 1999 budget next month.

It was not immediately clear why Christodoulou wanted to leave his key cabinet post at the head of the powerful Finance Ministry to take a job as director of the Association of Commercial Banks, notwithstanding the attraction of a huge salary.

Informed sources said that President Glafcos Clerides, while keen to replace Christodoulou, did not want to see him leave the cabinet and offered him another ministerial brief. Christodoulou, according to the sources, turned down the offer.

Christodoulou has over the years built a reputation for being blunt and straight talking. This, according to the sources, was partly to blame for a certain lack of popularity among some of the island's influential businessmen. "He does not have many friends in the private sector," said one source.

"There has been a great deal of pressure from the big businessmen to remove Christodoulou from the finance ministry, but he chose to leave the cabinet rather than take a lesser brief," said the source.

A career civil servant, the minister is a stalwart of Disy, the senior partner in Clerides' ruling coalition. For a brief period last summer Christodoulou appeared to have lost the whole-hearted support of his party colleagues after a proposed tax package was thrown out of the House, causing Clerides' government acute embarrassment.

Even Disy's coalition partners voted against the package last May, saying they had not been adequately consulted about the measures and Disy leader Nicos Anastassiades later complained that cabinet ministers from the party were showing disregard by not consulting with its leadership.

Since the débâcle in the House last May, Christodoulou has never tired from telling anyone who would listen that the fiscal deficit and public debt would continue to widen unless Parliament adopted measures to boost state revenues.

He warned last week that Value Added Tax must climb seven percentage points from the present eight per cent if the island hopes to become a European Union member by January 1, 2003, as it hopes. The House last May rejected a four percentage point rise in VAT as part of the tax package which, had it been adopted, would have earned the treasury £150 million in additional revenues.

Christodoulou, if indeed he does leave the finance ministry, would take credit for a dazzling set of economic indicators. The economy is set to grow by 4.7 per cent this year, while inflation and unemployment are both below three per cent and expected to decline further in 1999.

Tuesday, December 22, 1998

[03] Defence tax goes up

INCREASES in the defence levy for the first six months of 1999 were narrowly passed by the House plenum yesterday, while deputies also voted to keep the price of petrol artificially high.

In the last House session before the Christmas break, the 1998 law on defence tax was modified to lessen the burden on pensioners and low earners but increase the cost for those with supplementary sources of income.

In accordance with an Akel proposal, pensioners will only be taxed on what they make above £3,000 per year, as opposed to the previous £1,750. Deputies threw out an Akel proposal for scaled contributions, but in another effort to help low earners the entire amount paid by anyone making up to £2,500 a year will be returned to them as rebates.

The defence levy, which in August was upped by half from two to three per cent, was yesterday further raised to four per cent for certain individuals and organisations. Those receiving dividends and interest on loans now pay the higher charge.

Also liable are landlords who will pay four per cent on 75 per cent of the rent they receive, companies which will pay four per cent on profits and organisations which will pay four per cent on their total income.

After lengthy and heated debate, voting on the contentious bill was put off for almost an hour and a half to give deputies time to mull over the options while other, less controversial amendments were considered. The bill was eventually passed by 25 votes to 24.

The government had initially wanted the bill passed for a year, but had to accept a compromise six-month increase, after which the levy will again come up for review.

Despite falling international petrol prices, the House also voted that the retail price of fuel should remain the same. The government has excused this stance by saying that the extra £45 million a year netted from the artificially high pump prices is returned to consumers in the form of electricity bill rebates. A lot of this money also goes to the Defence Fund, helping keep the defence levy down, the government argues.

Opposition party Akel claim the artificially high pump prices amount to a "secret" tax on consumers. The price of crude oil has dropped from $26 a barrel in 1996 to about $10 a barrel now.

The deputies then rounded off the evening with the traditional knees-up Christmas party.

Tuesday, December 22, 1998

[04] Israeli spy suspects deny all charges

TWO ISRAELI nationals yesterday pleaded not guilty to charges of spying against military positions in Cyprus in October and November this year.

The Larnaca Assizes court rejected a second defence request that suspects Udi Hargov, 37, and Igal Damary, 49, be released into the custody of the Israeli embassy in Nicosia till the start of their trial, set for January 20.

"The court cannot approve what would in essence be private arrangements for the holding of suspects," said presiding judge Dimitris Hadjihambis in rejecting the defence appeal for the suspects' release into the embassy's care on bail.

A similar defence appeal to the Larnaca District court during a remand hearing last month was also rejected.

This time round, defence lawyer Andis Triantafyllides brought in the big guns, calling the Israeli embassy's consul, Michel Arel, to the witness stand to guarantee, on behalf of the Israeli government, that the suspects would reappear before the court on the set date.

"Israel is a democracy where citizens' freedom is considered very important and because we know the suspects are not guilty of a crime the Foreign Ministry of Israel has authorised me to give guarantees that they will reappear if they are released from police custody," Arel, speaking through a translator, told the court.

Israel has already made it plain that it wants the two spying suspects - who were arrested in a holiday flat in the Larnaca district coastal village of Zigy on November 7 - sent home. On a visit to the Island last week, Israel's former Prime Minister Shimon Peres stated his government wanted Hargov and Damary returned, saying they had been "fighting terrorism" and not spying against Cyprus or any other country.

Israel has not denied the two suspects might have been Mossad agents but insists they were not spying for Turkey.

"They will be kept in an embassy flat and will be watched 24 hours a day," Arel promised, adding that the embassy was willing to post any bail.

He said Hargov and Damary would not be able to leave the embassy flat without Cyprus police, who man a guard post outside the embassy, seeing them.

The court was unmoved by Arel's promises or by Triantafyllides' argument that the prosecution case was "weak" and unlikely to lead to a conviction.

Triantafyllides, one of three local lawyers defending the Israelis, said police had no concrete evidence against his clients. He said a key piece of police "evidence" - a map police claim to have found at the suspects' flat with sites of "military importance" circled on it - was nothing but a tourist map with sites of archaeological and cultural interest marked on it.

Speaking after a half-hour recess to consider the bail application, judge Hadjihambis said the evidence before the court was enough to justify the suspects' remand. He said the court had no reason to doubt the adequacy of security arrangements at the Israeli embassy, but noted that this was "not the issue" at stake.

The court had no jurisdiction to approve the suggested alternative custody arrangements, the judge said.

"The court cannot by law do this," Hadjihambis said.

At the start of yesterday's proceedings, police prosecutor George Papaioannou read out three revised charges to Hargov and Damary.

They were charged with conspiring, between October 15 and November 6 this year, "in Cyprus and Israel" to spy against "military facilities" with the intention of collecting information "that could be useful to any other state."

The second charge alleges similar information was collected at Zygi village during the same period. The third charge relates to possession "without permission from the cabinet" of three listening devices capable of tuning in to radio frequencies.

Police say they found devices tuned into police frequencies at the suspect's flat on November 7.

The accused replied "not guilty" to all three charges - the only words they spoke throughout the two-hour court proceedings yesterday.

The charges read out yesterday were an apparently watered down version of the original charges read out in court on November 20, when it was alleged Hargov and Damary had "collected information on the defence of the Republic and passed this on to another country via computer." The original charges also made no mention of Israel.

The suspects, the beards they had sported during their last court appearance gone, did not appear too distressed by the rejection of their bail appeal. They smiled and chatted to their lawyers and Arel before being handcuffed and led off to a black police Maria to be driven to Nicosia central prison.

The hearing was again accompanied by tight security, with about a dozen armed members of the police rapid reaction unit (MMAD) guarding the court house.

Cyprus-Israeli relations have been seriously strained by the arrests of Hargov and Damary. The arrests came only three days after an official visit to the island by Israeli President Ezer Weizman. Weizman failed to pacify the government's concern over his country's military pact with Turkey.

Tuesday, December 22, 1998

[05] 'Critical juncture' in the Cyprus problem

THE GOVERNMENT is playing its cards close to its chest at this "critical" juncture, Government Spokesman Christos Stylianides said yesterday.

Addressing his daily press briefing, Stylianides said

the government expected the international community to pressure Turkey to become more involved in procedures that might lead to the demilitarisation of Cyprus.

He also refused to comment on what UN Security Council resolutions expected this month might be, saying "intense consultations at the UN and the international community level are now taking place", but that no details could be revealed "for tactical reasons."

However, he said the government was closely monitoring all on-going consultations.

Stylianides said it was not clear when the Security Council would discuss the Cyprus issue because of its current preoccupation with the crisis in the Gulf.

His statements came a day after UN Permanent Representative Dame Ann Hercus told the press that her shuttle talks were to continue as long as progress was being made.

Hercus was speaking at her end of year press briefing at the Ledra Palace hotel on Sunday, before leaving the island yesterday to spend Christmas in her native New Zealand.

Describing her meetings with President Glafcos Clerides and Turkish Cypriot leader Rauf Denktash as "intensive", she said they provided her with a "special and concentrated" opportunity to talk to both leaders and to get to know them better.

She stressed that the confidential nature of the talks was paramount to their success, adding that she was not telling one leader what the other had said, as this meant both "have an opportunity to talk freely and frankly with me, and they do."

"Because of that privacy and confidentiality, ideas can be explored in a way which is impossible in a public debate with the media hanging on every word," she went on, adding that many had expressed support for the confidentiality of the talks, including journalists.

Hercus said that no time limit had been placed on the shuttle talks, because "it makes no sense to set a time limit on that process, except one of common sense."

The question of direct proximity talks between the two leaders themselves had not been raised, she said.

The UN representative added that she had been able to report to UN Secretary General Kofi Annan that a "substantive and substantial" process was under way and that she was looking forward to 1999 as a "practical, creative realist".

Asked how she could say there was progress if the two leaders did not know what she was discussing with each other, Hercus replied: "because I conjoin them in the middle. If you work it out, it is actually a very sensible and very common process."

Hercus also commended Unficyp for preventing tension, and the two sides for maintaining the cease-fire, saying there had been "no major incidents". However, she expressed concern about hunters entering the buffer zone, as in their camouflage outfits they could be mistaken for soldiers by both sides.

On a more alarming note, she said there had been an increasing number of crossings of the maritime security line. Unficyp had decided to take action on this, she went on, to which end there would be improved markings on the shore so that boat operators "can better ascertain their exact position".

Hercus added that the six-monthly Secretary-general's special report on the operations of Unficyp had been submitted to the UN Security Council on December 7, but its discussion has been postponed until next week as a result of the Iraq crisis. For the same reason, the discussion of a December 14 report on the shuttle talks submitted by Kofi Annan had likewise been postponed.

At the same time, Hercus announced that Sarah Russel would be taking up her duties as the new Unficyp spokeswoman on January 4.

Tuesday, December 22, 1998

[06] Synod dismisses claims against Athanasios

ALLEGATIONS of immorality against Limassol Bishopric candidate Abbot Athanasios of Machairas are unfounded, the Holy Synod concluded yesterday.

However, the supreme Church body said there was scope for further investigation against elder Iosif of the Greek Monastery of Vatopedhi.

Iosif is accused of 'molesting' and 'infecting' seven Paphos nuns 17 years ago when he was in Cyprus. Athanasios was targeted because of his association with Iosif.

The allegations against both men were made by Bishop Chrysostomos of Paphos, who claims he received the information from reliable sources.

However, after the Synod's announcement yesterday following a six-hour meeting, the outspoken Paphos bishop could not contain his anger and hit out at journalists, kicking a microphone out of his way.

No comments were made after the Synod meeting, but a brief statement was read out by Synod secretary Archimandrite Vassilios Papaphotis.

He said the source of the information against Athanasios was unreliable, but that those allegations against Iosif should be further investigated.

Papaphotis concluded his brief statement with an appeal for a ban on public statements which "confuse and scandalise the public".

Last Wednesday, Chrysostomos had offered an apology for making the sordid allegations against Iosif, but insisted his claims were true.

He has consistently denied that his allegations have anything to do with his opposition to Athanasios's candidacy for Bishop of Limassol.

Bishop Chrysostomos's claims have outraged priests and further damaged the reputation of a Church already reeling from the recent fraud allegations which forced Bishop Chrysanthos of Limassol to resign.

Tuesday, December 22, 1998

[07] New think-tank set to start operations next year

THE NEW year is to see the creation of Cyprus' first think-tank, under the presidency of academic Ioannis Koutsakos, one of its prospective members confirmed yesterday.

Economist Marios Clerides told the Cyprus Mail the body would be autonomous and non-profit based, though it would be affiliated to governing party Disy. It would be modelled on similar think-tanks operated by conservative parties in Greece and the UK.

The think-tank will be established in the first months of 1999, and aims to devote its attention to political, financial and social issues concerning Cyprus.

Along with Koutsakos and Clerides, former ministers Chrysostomos Sophianos and Stathis Papadakis will also be involved in the new body, tentatively called the Eurodemocratic Institute.

The think-tank will study the opinions of society on various matters, create an electoral archive and investigate what voters consider before making the final decision at the ballot box. Public debates, seminars on socio-political issues, international conferences and cultural events will also be sponsored by the Institute.

Clerides said his personal goal in relation to the new institution would be to have "more economics and less politics" in the economic matters of the island.

The first conference to be organised by the Institute will be held in late January/early February and will address the subject of privatisation.

Delegates from the USA, Europe, New Zealand, Greece and Cyprus will give their opinions on topics such as "new technology and privatisation" and "political cost versus financial gain with privatisation".

Tuesday, December 22, 1998

[08] Embassy demo protests air strikes

SHOUTING "Down with Clinton," 15 people, claiming to be from seven Muslim countries and the Palestinian Territory, gathered yesterday outside the US Embassy in Nicosia to protest against US and British air strikes against Iraq last week.

Amid heavy Cyprus police security, the protesters carried placards that read: "Clinton murderer of children" and "USA - Britain - Murderers." No arrests or violence were reported.

Before massing outside the US Embassy, the protesters had presented a letter to the nearby Russian Embassy, thanking Russia for its strong opposition to the US-British attacks on Iraq.

Russia has recalled from Washington its US ambassador in protest over the US-British use of military force against Iraq, the first such recall from Washington by Russia since the end of the Cold War.

Some in the crowd said the were showing their support for Iraq and their opposition to US President Bill Clinton, who they said "transferred his personal problems in the war with Iraq."

It has been suggested that Clinton launched the four-day series of air strikes on Iraq last Wednesday to deflect the US Congress's attention from its vote, scheduled for the next day, on whether he should be impeached for allegedly lying under oath regarding his affair with ex-White House aide Monica Lewinsky.

The US House of Representatives on Saturday voted to impeach him anyway. He faces trial in the US Senate in January and removal from office if found guilty.

"It's time to lift sanctions against Iraq," some said, while others added that: "Bill Clinton should stop harassing Baghdad."

Clinton and British Prime Minister Tony Blair jointly ended the air strikes on Sunday, after declaring they had achieved their objective: to "degrade" Iraqi President Saddam Hussein's ability to produce chemical, biological and nuclear weapons.

The United Nations ordered Saddam to destroy all such weapons, following his defeat in the 1991 Gulf War, which drove his occupation forces from Kuwait.

The air strikes were launched after UN weapons inspectors told the UN Security Council Saddam had, yet again, broken his promises to give them unrestricted access to any site in Iraq they chose to inspect to verify Saddam's claims to having destroyed all his weapons of mass destruction.

The embassy protestors flew the flags of Lebanon, Syria and the Palestinian Territory. Some said they were from Lebanon, Syria, Iraq, Egypt, Pakistan, Afghanistan, Bangladesh and the Palestinian Territory.

Tuesday, December 22, 1998

[09] Armed robbers nab £38.50

According to police, two unknown men approached employees of the Co-op at around 12.15pm as they were arriving at the bank with a bag of uncashable cheques worth £200,000, bank books and £38.50 in cash.

The two employees had been to Nicosia to the central offices of the co-op banks to exchange the cheques for cash and had just returned to Polemidhia. Nicosia was unable to give them the cash.

Just as their car pulled up outside their building a red motorbike with two passengers approached them. One of the two masked men fired a shot in the air, the other grabbed the bag and they sped away.

Police believe the gun was fake because no shells were found in the area.

Tuesday, December 22, 1998

[10] Two killed in weekend crashes

Ioanna Georgiou, a schoolgirl from Frenaros, died on Sunday after the Mitsubishi Colt in which she was a passenger ploughed into a crash barrier on the Paralimni to Sotira road. The accident happened at around 5.45am and both she and driver Andreas Mixias, 18, were taken to Paralimni General Hospital. Georgiou was pronounced dead on arrival, while National Guardsman Mixias was seriously injured. An alcotest on him proved negative.

Earlier, Philip John Tofts, 46, was killed late on Saturday when the rented Hyundai in which he was a passenger collided with the Mitsubish Pajero of Lefkara man Stelios Yiasemides, 28, on the Lefkara-Skarinou road. The Hyundai's Israeli driver, Gadi Gaffen, 41, and three other tourists travelling with them - including two aged 76 and 78 - were injured and taken to Larnaca General Hospital. Yiasemides was in the car with his wife and three children, who were all unhurt.

© Copyright Cyprus Mail 1998

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