Cyprus Mail: News Articles in English, 99-04-30

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

Friday, April 30, 1999

CONTENTS

[01] Pourgourides wants new Michaelides 'corruption' probe

[02] Eurocypria hit back at CY threat to their promotions

[03] Cyprus Airways group posts £10 million profit

[04] Cyprus caught unawares by Kosovo peacekeeping suggestion

[05] In debt and without a factory: Pittas vow to rebuild

[06] Teenagers held for school arson attempt

[07] Vassiliou calls for aggressive defence of Cyprus reputation

[08] Dame Ann for Cordovez job?

[09] 'Skewered by his father-in-law'

[10] Farmers take pigs to the Palace

[11] Maltese ship in flames off Paphos

[12] Skeleton identified

[01] Pourgourides wants new Michaelides 'corruption' probe

HOUSE WATCHDOG Committee chairman Christos Pourgourides refuses to let former Interior Minister Dinos Michaelides off the hook.

The Disy deputy's persistent accusations of corruption may have forced Michaelides to resign earlier this year, but Pourgourides yesterday told the House plenum he wanted a fresh state probe into Michaelides' alleged misdemeanours.

"I call on the Attorney-general to investigate again so that the truth may shine at last," Pourgourides said in an impassioned address which opened an oft-postponed debate on his committee's report into Michaelides' alleged actions as minister.

Michaelides was cleared of any wrongdoing by three separate probes. He was only forced to quit his post after former government spokesman Christos Stylianides resigned in protest at a cabinet decision to back him.

Pourgourides repeated his claims that Michaelides had abused his position as minister for personal financial gain, and he labelled the past investigations "fiascos".

"The criminal investigators said they would not investigate my complaints of money laundering because, at the time it happened, the law had not yet been passed," he said. "But the money laundering law clearly states it is retroactive."

The Disy deputy told the House that despite the three investigations the crux of his allegations - that Michaelides was guilty of unlawful enrichment - had not been properly looked into. "No-one, but no-one, has dealt with what property the minister had when he took office, and what he had when he left, and how he got it," Pourgourides said.

The Inland Revenue Department is still investigating the former minister's tax returns, but Pourgourides said this did not represent a "full" assets probe.

Pourgourides also spoke of his "sorrow" at "having" to campaign against Michaelides: "The minister was my friend until the day I made the charges. But what would happen if we always turned a blind eye to what a friend did?"

He said Cyprus was riddled with corruption and he felt it was his duty to fight it: "There's no smoke without fire, and in Cyprus the smoke is often black and choking."

The debate is set to continue on May 6.

Friday, April 30, 1999

[02] Eurocypria hit back at CY threat to their promotions

EUROCYPRIA pilots said yesterday they would not tolerate colleagues from Cyprus Airways (CY) muscling in on their promotions.

Constantinos Pitsillides, union representative for pilots at Eurocypria, said CY management was stalling on filling captain vacancies at the sister charter firm, fearing an adverse reaction among their own pilots.

CY pilots union Pasipy has already laid claim to the Eurocypria positions, and meets today to discuss possible strike action relating to their demand and to complaints about an "overloaded" summer schedule.

"If the vacancy is not filled, Eurocypria will not be in a position to fulfil its obligations towards tour operators," Pitsillides said.

He said any promotions to captain within the charter firm must under their collective agreement be filled by Eurocypria pilots. The appointments had been due by March 31.

Union representatives discussed the issue with the Labour Ministry and group management yesterday.

"Cyprus Airways does not want to fill the vacancies because of the reaction of their own pilots," Pitsillides said.

Pasipy said on Wednesday that it had an agreement with the company to study "common seniority" in foreign airlines by going abroad. They want CY to wait until the report on the visits is completed in 20 to 25 days' time before filling the vacancies in Eurocypria.

However, Pitsillides said the agreement for the report was made only between CY pilots and the company. Eurocypria pilots were not involved, and in any case, he said, the report was already late on both its original March 31 deadline and an extension that ends today.

He said the vacancies need to be filled immediately for the sake of the charter firm's future, and by Eurocypria pilots in line with the collective agreement.

"The company has to act now. They have no other option or the company will suffer as a result," Pitsillides said.

"But if they fill the vacancies with Cyprus Airways pilots, they will be violating our collective agreement."

Pitsillides said Eurocypria pilots were reluctant to threaten strike action. "We would try to look for other ways," he said. The Labour Ministry is expected to give its views some time next week, he said.

Eurocypria is one of the few viable sectors of the Cyprus Airways Group, posting a pre-tax profit in 1998 of £2.2 million according to the Group's financial results released yesterday.

Speaking at a news conference to announce the results, CY chairman Takis Kyriakdies said the pilots' dispute posed a serious problem.

"On the one hand, there is a clear agreement between the company and the pilots of Eurocypria and on the other a special agreement with Pasipy," he said.

Kyriakides said the company was trying to resolve the issue through dialogue and would be meeting Pasipy today "to see if we can find a solution to appease all sides."

CY pilots said on Wednesday they may go on strike claiming they are overworked and pose a danger to public safety.

They want nine of their members promoted to Captain in CY and another nine new co pilots hired, as well as the captain vacancies in Eurocypria.

On the Larnaca-Manchester route - the longest flown by either CY or Eurocypria - CY pilots have a seven to eight hour duty shift, with five hours in the air. They stop over in the UK for at least 12 hours before returning to Cyprus on the same basis.

A Eurocypria pilot on the same route but operating a return flight spends 10 hours in the air and another three to four on duty.

"Cyprus Airways pilots spend less time flying than Eurocypria one but they do more time on duty," a company source said.

CY pilots fly 62 hours a month, which the company says is below international standards, and even lower than the maximum hours specified in the collective agreement signed between the company and the pilots.

CY pilots are also among the best paid in the world.

Friday, April 30, 1999

[03] Cyprus Airways group posts £10 million profit

CYPRUS Airways yesterday announced a group pre-tax profit of £10 million compared to losses in 1997 of £3.2 million.

The turnaround in the troubled group's fortunes was because of increased revenue and passenger figures, and savings of some £2 million, CY chairman Takis Kyriakides told journalists.

He said the group's total revenue rose to £146.2 million in 1998 from £135.2 million, an 8.1 per cent increase surpassing all expectations under the strategic plan up to the year 2000.

The group comprises Cyprus Airways, charter firm Eurocypria, the duty free shops and tour operator Cyprair.

CY recorded pre-tax profits of £5.3 million in 1998, compared to a loss of £3.1 million in 1997.

After two years of losses around the million mark, Eurocypria last year recorded a profit of £2.2 million, 17.5 per cent of which will go to its employees as a "thank you gift", Kyriakides said.

Duty Free Shops Ltd recorded profits of £2.5 million in 1998 compared to £800,000 in 1997. Kyriakides said the shops had shown an impressive 39.3 per cent increase in sales.

Cyprair also showed a small profit of £66,000, up from 1997's £48,000.

Kyriakides said passenger figures for the two airlines had also increased by 4.5 per cent, bringing the total number in 1998 to 1.35 million. The airline maintained its 35 per cent share in the air transport market to the island.

"This means that one in every three passengers who flies to and from Cyprus uses either Cyprus Airways or Eurocypria," Kyriakides said.

The three most profitable routes for the airline were Athens, London Heathrow and Tel Aviv, Kyriakides said, bringing in some £9 million in revenue, which he said went to subsidise some of the less profitable routes.

The CY chairman put the year's overall results down to a combination of other factors as well as revenue and passenger increases.

He said external factors included a favourable international financial environment, low fuel costs and improvements in the exchange rate against sterling.

Kyriakides also said there had been some success in reducing costs by cutting back on staff in overseas offices, reducing vacancies within the company and cutting loss-making routes.

"The result of this was a saving over the year of around £2 million," he said.

Kyriakides said that although the forecast for 1999 was also promising, the group's running costs continued to be an issue of concern, reaching £133.6 million in 1998 - an increase of £2.6 million, despite the cost of fuel being lower by £3.3 million during the year.

Kyriakides warned that by 2002, competition would reach "threatening levels".

"We are still at the start of the road and we have a long way to go and a huge job to complete before we achieve full recovery," he said.

Friday, April 30, 1999

[04] Cyprus caught unawares by Kosovo peacekeeping suggestion

CYPRUS was caught unawares yesterday after Yugoslavia suggested it could contribute UN peacekeepers in a future Kosovo settlement.

"We don't have any idea about this, nobody has approached us," government spokesman Costas Serezis told the Cyprus Mailyesterday.

Belgrade's proposal - that it would accept a UN civilian force from nonaligned countries - was made by its ambassador to Moscow Borislav Milosevic, brother of Yugoslav President Slobodan Milosevic.

"Yugoslavia is ready to accept a civilian mission under a United Nations flag, with Yugoslavia to agree on the composition and the number of countries," Borislav Milosevic told reporters in Moscow.

"It can be countries that did not participate in this (war) and did not support it, let's say India, Belarus, perhaps Cyprus," he added.

"At the moment we cannot speak about hypothetical questions," Serezis said, carefully choosing his words.

Cyprus has been careful not to condemn the Nato bombings outright, but the government has said it disapproves of the killing of innocent civilians.

The island has very strong political, religious and cultural ties with Yugoslavia, which is seen as a friendly country.

Borislav Milosevic made the comments as Russian envoy Victor Chernomyrdin left for Germany as part of Moscow's diplomatic efforts to broker a peace agreement in Yugoslavia.

Friday, April 30, 1999

[05] In debt and without a factory: Pittas vow to rebuild

WITH ITS state-of-the-art factory written off by a fire last Sunday, Pittas Dairies and its owners are left with the unenviable task of rebuilding their production base while saddled with debts.

The £10-million factory at Latsia on the outskirts of Nicosia had barely begun operating four months ago, with brothers Athos and Melis Pittas hoping that the standard of hygiene and efficiency provided by the high- tech equipment would crack open new export markets and tempt upmarket overseas retail chains to stock up their products.

Pittas, the island's oldest and largest dairy, has for many years carried the flag in foreign markets as far afield as Australia, the Persian Gulf and West Africa. Its halloumi cheese, arguably the island's best known export item, has won the island and Pittas international fame and spearheaded the company's export-driven expansion, the new factory included.

"What is important now is to revive the company," said Athos Pittas. "I am constantly in contact with the government as I try to put together an action plan to revive the company," he told the Cyprus Mailon Wednesday.

The task of getting Pittas back to where it was on the eve of Sunday's fire will be a particularly difficult task, but the Pittas brothers Athos and Melis are unperturbed by the challenge ahead.

"We shall build a new factory with the same design and at the same place," said Melis Pittas, in a what sounded like a deliberate display of resilience.

"We've lost our momentum in the market for the time being... but we shall be returning to sizeable production by the end of May," he told the Mail.

Pittas has retained its old factories in Nicosia and can still produce several types of cheese and yoghurt from there and other facilities not affected by the fire. "But we also need short-term assistance from the government... (such as) refrigerators, warehouses," Melis Pittas said.

A highly-placed source who was briefed earlier this week on the company's financial affairs told the Cyprus Mailthat Pittas owed the Popular Bank £14-15 million and the Development Bank a further £2 million.

"These are initial estimates, which may turn out to be lower than in reality when more information is made available next week," said the source, who spoke on condition of anonymity.

There were other figures floating in Nicosia about Pittas' total debt and the value of the insurance policy on the factory, which varied between £8 and £10 million.

One estimate put the debt at £18.75 million, a figure that Melis Pittas said was way too high when it was mentioned to him by the Mailon Wednesday. He also categorically denied that four Popular Bank executives sit on the company's seven-man board of directors.

Popular Bank spokesman Andreas Stylianou refused to comment on Pittas' credit status, saying only: "Pittas are just big customers of ours."

But banking sources pointed out that Pittas looked like a safe bet given the company's huge export potential. "Let us say that the Pittas' exposure would not bring about the collapse of the Popular Bank," said one source.

Pittas were Bank of Cyprus customers until 1995 when they took their business to the Popular Bank. Industry sources say the decision to change was made by Pittas when the Bank of Cyprus refused to extend new lines of credit to the company on the grounds that it was stretching itself too thin.

Melis Pittas, however, said the company changed banks because Popular Bank had offered better terms than those given by its bigger rival.

Ironically, last Sunday's disastrous fire came only days before a team from the in-house magazine of giant British retailers Sainsbury's was due in Cyprus to research an article about Pittas halloumi, the product that Pittas was heavily counting on as the engine of export expansion.

In September, officials from Sainsbury's had been scheduled to arrive on a much-heralded visit that was expected to produce an agreement for the supermarket chain to stock Pittas products.

Friday, April 30, 1999

[06] Teenagers held for school arson attempt

On Wednesday evening, police patrolling the school spotted several youths causing malicious damage and trying to set fire to classrooms.

When police officers moved in, the culprits got away except for one 15-year- old boy from Engomi, who was caught throwing stones at windows.

He named three others in a statement to police, saying their aim had been to burn down the school, which has been a target for vandals in the past.

After the pupil gave his statement, police arrested two boys from Strovolos and one girl from Nicosia, all aged 15.

Following the arrests, all four schoolchildren were taken to a Nicosia district court yesterday where they were remanded in police custody for one day.

Education Minister Ouranios Ioannides agreed yesterday that schools were unprotected, but said the cost of making them secure day and night was prohibitive.

"Our efforts are focused on persuading children that they have absolutely nothing to gain by destroying schools," Ioannides told reporters.

"But I would say there are always a handful who ignore this message," the minister added.

Nicosia CID are continuing their investigations.

Friday, April 30, 1999

[07] Vassiliou calls for aggressive defence of Cyprus reputation

A MONEY laundering seminar that kicked off with a baffling joke about two senior Arab leaders yesterday heard former president George Vassiliou make a vigorous defence of Cyprus' reputation as an international business centre.

The one-day seminar was organised by HSBC Investment Bank Cyprus Limited and, beside Vassiliou, was addressed by Central Bank Governor Afxentis Afxentiou and Robert Cooper, HSBC Group's regional money laundering control officer.

The joke about President Hosni Mubarak of Egypt and Saudi Arabia's King Fahd came in introductory remarks by Takis Taoushanis, the managing director of HSBC Cyprus.

Taoushanis said he was telling the joke to give his audience of several hundred people what he described as an "interesting angle" on money laundering.

During a visit to Egypt, the joke went, the Saudi king wanted to give Mubarak a Mercedes as a present. The Egyptian leader refused, insisting that to do so Fahd must accept something in return. Fahd agreed to take a pound, but Mubarak only had ten. When told by Fahd that he had no change, Mubarak asked for nine more cars instead.

The joke was received with polite laughter. Back to money laundering.

Vassiliou, also the island's chief negotiator in the 13-month-old accession talks with the European Union, said Cyprus needed to counter recent allegations that Serbian money was illegally channelled to the island to purchase arms for the beleaguered Yugoslav government of President Slobodan Milosevic.

"The only way to convey the message is to be aggressive. A lot of noise is being made because of the Yugoslavia case, but we have to defend ourselves, particularly because we happen to know that we are honest," said the former president, who said he felt strongly about the issue.

"I think that what we are facing is an organised effort to discredit Cyprus. But the truth is that Cyprus is not, was not and never will be a money laundering centre.

"Our Central Bank has gone out of its way in order to control banks operating on the island," he added.

There are an estimated 40,000 companies registered as offshore enterprises on the island. A little more than 1,000 of these maintain a physical presence on the island, employing hundreds of people. The offshore sector, which includes some 30 banks and is among the fastest growing areas of economic activity, is also serviced by thousands of accountants, lawyers, real estate firms and other qualified Cypriots.

"I am doing everything I can to help Cyprus protect its image as a clean international business centre... we don't like to be accused of money laundering," Vassiliou said.

Friday, April 30, 1999

[08] Dame Ann for Cordovez job?

An official at the New York office of the UN's secretary-general's spokesman, Fred Eckhard, yesterday told the Cyprus Mailthat they could "neither confirm nor deny" reports that Hercus would be replacing Cordovez.

Cordovez' resignation was announced by Eckhard on April 23.

Cordovez had held the post for two years. No reason was given for his resignation by either New York or Nicosia.

Hercus became special envoy nine months ago.

Friday, April 30, 1999

[09] 'Skewered by his father-in-law'

Costas Vassiliou, 32, needed hospital treatment after his 60-year-old father-in-law Melis Theocharous allegedly stabbed him in the stomach with a meat skewer.

Police said they arrested Theocharous in connection with the assault yesterday morning. Vassiliou had been arrested the day before for attacking a police officer.

The incident happened at Theocharous' home in Zakaki village on Wednesday night when the two exchanged strong words over "family problems".

Police were called to the scene soon after the row began, and Vassiliou allegedly attacked a police officer while trying to resist arrest.

During the commotion, Theocharous produced a souvla skewer and stabbed Vassiliou with it, police said yesterday.

Vassiliou was taken to Limassol general hospital, where he is under police guard and said to be out of danger.

When questioned, Theocharous admitted to the offence and handed over the skewer to police.

[10] Farmers take pigs to the Palace

A senior official from the Panagrotikos Agriculture Association, Theodosis Tsangarides, said representatives had presented the farmers' petition to presidential undersecretary Pantelis Kouros.

"Kouros listened to us with great attention," Tsangarides said. "He said he would take our demands to the Cabinet meeting next week."

Tsangarides added that Kouros had promised to give the farmers an answer on their demands by next Wednesday, assuring the protestors these would be met as soon as possible, "if the Ministers found them reasonable."

Over 100 farmers with 30 pig-filled trucks demonstrated outside the Palace for just over an hour around midday.

The farmers are demanding additional government funding. Specifically, they want an immediate injection of cash to destroy a number of their pigs in order to redress the balance of supply and demand.

The petition suggested the slaughtered pigs be kept in freezers or disposed of at landfills.

In addition, farmers want a further £750,000 invested into pork exports on top of the £150,000 they have already received, and for the government to find them new markets.

Friday, April 30, 1999

[11] Maltese ship in flames off Paphos

The ship issued a Mayday signal after catching fire in the early hours of the morning.

According to a police report, none of the Greek and Filipino crew of the Evxentios Pontoswere injured in the fire, which caused extensive damage to the ship.

Police said the fire had been put out by the time the Paphos coast guard arrived, but a police boat remained in the area in case further assistance was needed.

The 28-man crew remained on board throughout the incident.

The ship was last night waiting to be towed to its port of departure, Piraeus.

Friday, April 30, 1999

[12] Skeleton identified

DNA testing confirmed that the bones belonged to Andreas Neophytos Onisiforou, also known as Hartosia.

Onisiforou went missing in May 1989, aged 35.

Onisoforou's parents told police that they had received threatening phone calls days before his disappearance. The callers had said they would kill Onisiforou if he did not stop seeing a married women.

Police will be meeting on Tuesday to discuss the next steps in solving the murder.

© Copyright Cyprus Mail 1999

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