A.N.A. Bulletin, 26/04/96

From: "Greek Press & Information Office, Ottawa Canada" <grnewsca@sympatico.ca>

Athens News Agency Directory

ATHENS NEWS AGENCY BULLETIN (No 871), April 26, 1996

Greek Press & Information Office

Ottawa, Canada

E-Mail Address: grnewsca@sympatico.ca

CONTENTS

[1] Greece, Turkey have room to move for better relations, Kornblum says

Visiting US Assistant Secretary of State for European Affairs John Kornblum said there was room to move in relations between Greece and Turkey, following talks he had in Athens with Foreign Minister Theodoros Pangalos.

Mr. Kornblum, who arrived in Athens Wednesday night from a visit to Turkey, also met with Prime Minister Costas Simitis and National Defense Minister Gerassimos Arsenis.

Speaking to reporters after talks with Mr. Pangalos, Mr. Kornblum underlined that the US position on the settlement of territorial disputes was that they should be resolved peacefully.

"The peaceful settlement of these issues is the most important thing," he said.

Mr. Kornblum said he would "refrain from telling either government what steps to take," stressing that "this is not a role we have defined for ourselves."

Asked whether he had perceived any willingness on the part of Turkey to refer the Imia issue to the International Court at The Hague, Mr. Kornblum replied:

"I think there's a possibility (for recourse)... (Turkish Premier) Mesut Yilmaz seemed determined to move forward but I can't speak for them."

Mr. Pangalos described Greek-US relations as "excellent," adding however that there was room for even further improvement, while Mr. Kornblum termed bilateral ties as "extremely close" and "positive."

Mr. Kornblum said one of the reasons for his visit was at the request of President Bill Clinton in order to examine opportunities "to realize the potential of all countries" in the region.

He said he had discussed economic possibilities and opportunities in the Balkans in general, saying he was optimistic following the changes that had taken place in the region.

Replying to questions, Mr. Kornblum said he had not made any proposals on any issue. As a friend of both Greece and Turkey, he added, the US saw its role as one of "facilitating political contacts."

'We don't see ourselves as mediators. I have not come here with any initiatives or proposals," Mr. Kornblum said.

Asked to comment on a US Congressional discussion, slated to be held today, on the human rights situation of the Moslem minority in Thrace, Mr. Kornblum downplayed its importance, saying that "the group is an advisory commission which investigates issue s", adding that he was not fully informed on the matter and could not comment further.

Replying to other questions, Mr. Pangalos said that the meeting with his Turkish counterpart Emre Gonensay on the sidelines of the Black Sea Co-operation Conference in Bucharest on Saturday would be an "acquaintance" meeting, adding that "personal contacts always help."

Mr. Pangalos said there were some positive elements in some of Mr. Gonensay's recent statements.

On the Pangalos-Gonensay meeting, Mr. Kornblum added that he had spoken to both ministers and each had given "positive expectations."

Government spokesman Dimitris Reppas later described Mr. Simitis' meeting with Mr. Kornblum as an "acquaintance" meeting.

He added, however, that Mr. Simitis had raised the issues of Greek-Turkish relations, the Cyprus problem and Greek-US relations, including the matter of the US Department of Transportation warning about security arrangements at Athens international airport. Also discussed was Greece's role in the Balkans.

Mr. Reppas said that Mr. Kornblum's visit should not be "automatically" linked with the Pangalos-Gonensay meeting in Bucharest.

Replying to questions, Mr. Reppas said that the Bucharest meeting would not have a specific agenda for discussion and that no concrete results were expected.

"But the two ministers will be able to get acquainted and exchange certain views one-on-one," the spokesman added.

Mr. Reppas said Greece hoped that the Pangalos-Gonensay meeting would result in Ankara acknowledging respect for international law and reason, but predicted that it would be difficult for Turkey to take steps in this direction.

[2] Arsenis

The visiting US official was also briefed yesterday on developments in the Balkans and the eastern Mediterranean by National Defense Minister Gerassimos Arsenis.

Mr. Kornblum said he attributed great importance to the region, adding that he considered US relations with Greece "particularly close."

He said he came to Greece as soon as possible after the assumption of his post in order to learn about the issues of the region, the views of the Greek side, and to seek ways of advancing these significant issues. "I shall leave with a better understanding of the nature of the problems and the expectations of the Greek side," Mr. Kornblum told reporters after the meeting. He expressed the hope that he will return to Athens soon to continue his co-operation with the Greek government.

Mr. Arsenis said after the meeting he had briefed Kornblum on the Greek views, and "I believe, as he himself said, that he leaves better informed on the positions of the Greek government."

The meeting was also attended by National Defense Under-secretary Nikos Kouris and US Ambassador in Athens Thomas Niles.

[3] Kornblum in Cyprus

Mr. Kornblum arrived in Cyprus last night for talks with President Glafcos Clerides and other officials in light of a new initiative by his country on the Cyprus issue expected to take place next June.

In a statement at Larnaca airport, Mr. Kornblum said he had not been discouraged by his contacts in Ankara and Athens where, he said, he ascertained the existence of goodwill.

Mr. Kornblum reiterated his assessment that a unique opportunity to resolve the Cyprus issue was being presented.

[4] Athens hails Palestinian decision to revoke demands to destroy Israel

The Greek government welcomed the decision Wednesday by the Palestinian National Council to remove those articles in its charter calling for the destruction of the Jewish state, a foreign ministry announcement said yesterday.

"Greece now awaits the further promotion of the peace process through courageous decisions by Israel and the Palestinians, allowing both peoples to live peacefully and safely, and enjoy all their legitimate rights," the announcement said.

[5] US Congress urged to stop arms to Turkey, solve Cyprus problem

Greek-Americans asked the US House of Representatives' Foreign Operations Appropriations Subcommittee yesterday to call for a halt to the large-scale US arms flow to Turkey, underlining the dual points of halting Ankara's massive arms proliferation and solving the Cyprus problem as the keys to bringing greater stability to the entire region.

"All aspects of US policy interests in the eastern Mediterranean and the southern Balkans are influenced by the fact that Turkey is closer today to aggression against Greece and Cyprus than it has been in two decades," said Andrew Manatos, the president of the National Coordinating Effort, representing major Greek-American and Cypriot-American groups.

The Greek-American lobbyist also represented the International Coordinating Committee-Justice for Cyprus (PSEKA), the PanCyprian Association of America as well as the United Hellenic American Congress (UHAC) at the hearing.

The House subcommittee is currently drafting legislation for the next fiscal year's foreign aid appropriations to Turkey, Greece and Cyprus.

"The US cannot ignore Turkish threats against Greece and Cyprus or Turkey's horrendous record of violations of human rights and international law. US military aid and sales must end," he said, adding:

"If they (arms) continue in any form, the US must prevent Turkey from using US equipment to threaten the safety of Greece and Cyprus."

In further comments, Mr. Manatos recalled that the chairman of the House International Relations Committee, New York Republican Ben Gilman, recently stated that he did not believe that Congress should authorize or appropriate funds for military loans to Turkey in 1997.

Last year, a report accompanying the 1996 fiscal year House Foreign Operations Appropriations Bill noted that the current year will mark the graduation of Turkey as an annual foreign military financing loan program recipient and that a request for loans to Turkey will not be expected next year, since no funds have been authorized in fiscal 1997.

Referring to the situation in Cyprus, Mr. Manatos said this "near-war situation between Greece and Turkey brings into even closer focus the importance of a Cyprus settlement to the US and the international community."

He also reminded the House committee that former US assistant secretary of state Richard Holbrooke had expressed an opinion that "a just and viable Cyprus solution will cut the 'Gordian Knot' and bring greater stability to the eastern Mediterranean and the southern Balkans.

"It is our hope that this year the desires of America, the UN, the European Union and Cyprus can be realized with regard to a just and viable solution to the Cyprus problem," he added.

Finally, another issue touched upon at the hearing concerned Athens and Nicosia's displeasure with Washington's recent decision to choose Turkey as the first nation to receive the state-of-the-art ATAC-M missile system.

According to information presented at the hearing, during the last three years, arms agreements between Washington and Ankara reached $4.9 billion, while weaponry already delivered to Turkey was valued at more than $2.4 billion.

[6] Greece recognizes Federal Yugoslavia as successor nation

The foreign ministry verified yesterday that the Greek government officially recognized the Federal Republic of Yugoslavia as an independent nation "within its internationally recognized borders and as one of the successor nations of the Socialist Federal Republic of Yugoslavia."

According to a foreign ministry announcement, Athens' recognition is consistent with an April 9 European Union declaration and "opens the way for the upgrading of our diplomatic representation in Belgrade at the ambassador's level."

Greece has now officially recognized all the nations formed after the breakup of the former Yugoslavia.

"The Greek government looks forward to the further development of relations with the Federal Republic of Yugoslavia and expresses the hope that it (Yugoslavia) will respond positively to the April 9 EU declaration, so that relations with the European UN ion can develop without hindrance."

[7] Turkish claims of harassment of fighter planes denied

Sources close to the Hellenic Air Force categorically denied claims yesterday by the Turkish foreign ministry over alleged harassment of Turkish fighters flying south of Crete in international airspace.

Ankara said eight of its aircraft were intercepted by Greek fighters while flying to Italy to replace other Turkish units participating in NATO-led IFOR forces in Bosnia.

"There is no chance of harassment," the sources said, adding that only planes violating Greek airspace would be intercepted, as foreseen by relative directives.

[8] Slovakia in full agreement with Athens on Cyprus, relations with Turkey

Slovakia's Foreign Under-secretary Josef Sestak yesterday expressed complete understanding and agreement with Greece's positions on relations between Athens and Ankara as well as on the Cyprus problem.

Mr. Sestak had talks yesterday with Alternate Foreign Minister George Romeos.

Mr. Romeos referred in particular to the recent incident in the Aegean when Turkey disputed Greece's sovereignty of the Imia islets. He also stressed Greece's support for "the single, international entity of the Cyprus Republic."

On his part, Mr. Sestak expressed his country's desire to participate in the European Union and NATO.

[9] Bulgaria ratifies Nestos river agreement

The Bulgarian Parliament yesterday ratified a Greek-Bulgarian agreement for the use of the Nestos river waters.

The agreement was initially rejected by Bulgarian President Zhelyu Zhelev earlier this month, who referred the issue to the Parliament for re-consideration, in accordance with the constitution.

The main opposition party and President Zhelev criticized the ruling Socialist Party of not defending the country's national interests.

[10] Premier will brief Cabinet today on recent visits

Prime Minister Costas Simitis will brief the Cabinet today on the results of his recent visits to the United States, Britain and Ireland, government spokesman Dimitris Reppas said yesterday.

Mr. Reppas added that the international climate for Greece was much better, while the country's positions were finding a response.

"We are on a good course but the efforts must continue," the spokesman said.

Also on the agenda for discussion at today's Cabinet meeting will be a number of social problems, including the issue of unemployment, Mr. Reppas said.

[11] ND announces EPP seminars

The political and strategic situation in the Mediterranean, the EU's environmental policy and economic and monetary union (EMU) are to be the subjects of working seminars to be held by the European Peoples' Party in Vouliagmeni between April 29-May 3.

Those due to participate in the seminars include the prime minister of Luxembourg, Jean Claude Junger, and EPP President Wilfred Martens.

Within the framework of the events hosted by the New Democracy party, a concert will be held by Nana Mouskouri at the Athens Concert Hall on April 29, the proceeds of which will be donated to a fund for the children of Bosnia-Herzegovina.

Mr. Martens and New Democracy leader Miltiades Evert are to hold a joint press conference on May 2, while a press conference will be given by ND press representative Prokopis Pavlopoulos and Ms Mouskouri on May 5.

[12] Estonian church dispute to be resolved soon

Relations between the Ecumenical Patriarchate and the Moscow Patriarchate are expected to be restored in the near future, sources at the Phanar said yesterday.

The sources said the Holy Synod was due to discuss the issue of the church of Estonia which has caused a rift in relations between the two patriarchates.

The Moscow Patriarchate claimed the Estonian Church should fall under its jurisdiction while the latter wished to put itself under the jurisdiction of the Ecumenical Patriarchate.

During the crisis, the Ecumenical Patriarchate maintained a moderate stance keeping up communications with the Moscow Patriarchate while Russian Patriarch Alexios chose not to mention the name of the Ecumenical Patriarch during mass.

The sources said the Ecumenical Patriarch felt it had no right to ignore the requests of the Estonian people to restore their church, but had the moral and historical obligation to hear their voice.

[13] Parliament declares April 24 day of remembrance for Armenian genocide

Parliament unanimously decided yesterday to designate April 24 as a day of remembrance for the victims of the Turkish genocide of Armenians in 1915. The motion was originally submitted by Political Spring.

[14] Kastanidis at regional communications conference in Sofia

Transport and communications ministers from Balkan countries began a two-day meeting here yesterday, aiming at closer co-operation and the improvement of the region's communications infrastructure.

Ministers from twelve countries are attending the conference, including ministers from Greece, Turkey, Albania, Romania, Croatia, Slovenia and Yugoslavia, while representatives from Russia, Cyprus and Hungary are attending as observers.

Bulgarian Communications Minister Ljubomir Colarov said that with a population of 120 million, the Balkans can strengthen their negotiating positions against western investors if they join forces.

The conference is aimed at establishing presidents, directors and committees to coordinate work at many levels.

Greek Transport and Communications Minister Haris Kastanidis said Greece would help in harmonizing legal statuses between the Balkans and the Community.

He also said Greek communications were at a high level compared to other Balkan countries and that it could provide them with help in high-quality services.

[15] Greece, Albania agree on three new border posts

Greece and Albania yesterday agreed to open three new border posts, bringing the number of the crossings between the two countries to five, Albanian state radio reported.

The new border posts are expected to contribute to an increase in trade and human communication between Albania and northern Greece.

The Albanian authorities have also agreed to allow the opening of the Greek consulate in Korce.

The agreement was reached during the visit of Greek President Kostis Stephanopoulos to Tirana in March for talks with his Albanian counterpart Sali Berisha.

The National Bank of Greece is also expected to open a Tirana branch soon within the context of efforts between the two countries to improve relations.

[16] Albanian smuggler killed in skirmish with Greek coast guard patrol

An 18-year-old Albanian immigrant smuggler was shot dead in a skirmish with a Greek coast guard patrol boat inside Greek territorial waters off the island of Corfu at dawn yesterday, harbor authorities said.

They said two speedboats were spotted by the coast guard, but refused to heed two warnings to stop.

When the patrol boat fired warning shots, the Albanians responded with automatic weapons, the harbor authorities said.

The coast guard found the skipper and two persons on the one vessel and the body of 18-year-old Bashkimi Hiiza on the second vessel.

They also found a kalashnikov automatic weapon and various tools on one of the speedboats.

Harbor authorities believe that the speedboat with only the skipper on it had already let off an undisclosed number of illegal immigrants on Corfu. "The occupants of the second boat said they were on their way to Corfu port to steal speedboats, a phenomenon which has recently increased on the island," the harbor authorities said.

The Albanians were arrested and referred to the public prosecutor.

[17] Government response

Government spokesman Dimitris Reppas later expressed the government's regret at the loss of life.

Mr. Reppas said the trade in illegal immigrants was a "stigma upon our society" and expressed Greece's annoyance over the indifference shown by neighboring countries with respect to the guarding of their borders.

In a clear reference to Turkey, Mr. Reppas spoke of "the room given to 'slave-traders', traders in human beings, to make profit at the expense of people who are simply seeking a better life."

Greece, he added, would continue to maintain a determined stance on the issue, noting that the problem also had a political dimension, since it constituted a permanent source of friction and tension.

Mr. Reppas said that the entry of illegal immigrants from Albania was a different matter but called on Tirana to help Greece in dealing with phenomena such as yesterday's incident off Corfu.

Meanwhile another three Albanian illegal immigrants were detained by coast guard personnel yesterday in a truck at the port of Piraeus awaiting a ferry boat to Iraklio, Crete.

The three men claimed they gave the truck's driver 60,000 drachmas for their transport. However, the driver said the immigrants secretly entered his vehicle.

[18] Turkish man jailed for smuggling immigrants

A 28-year-old Turkish man was yesterday sentenced to 10 years jail and fined 13 million drachmas by a court on the island of Samos for trying to smuggle 12 Iraqi illegal immigrants into Greece.

The three-member court also passed a three-month suspended sentence on the illegal immigrants and ordered their expulsion from Greece.

Georgi Amatzi was arrested Tuesday after a chase by a Greek Coast Guard patrol boat when he refused to obey orders to stop for investigation and sped off in his six-meter speedboat.

The illegal immigrants, all Iraqis, said they had each paid $1,500 dollars to Amatzi for him to ferry them from the Turkish coast to Samos.

[19] Uneasiness in ND over recent changes

A climate of uneasiness prevailed yesterday in the main opposition New Democracy party after the first meeting, Wednesday, of the party's newly reorganized Political Council during which party honorary president and former premier Constantine Mitsotakis lashed out against party leader Miltiades Evert urging him to come out in the open with his intentions.

"If you do not want us in the party you should tell us," Mr. Mitsotakis told Mr. Evert who denied the charges.

The new crisis in relations between the two men is rooted in Mr. Evert's presentation on Saturday of the party's reorganized Political Council which excluded deputies and former ministers Sotiris Kouvelas and Dora Bakoyanni and deputy Costas Karamanlis.

Mr. Evert attributed changes in the political council to efforts to ready the party for elections.

Mr. Mitsotakis, who is a member of the Political Council, reacted to the changes, accusing Mr. Evert of "a mere redistribution of offices."

Mr. Kouvelas was equally harsh yesterday, saying that "we have struggled and sweated to build the New Democracy in the eighties. Nobody can throw us out of our home, especially the spectators and critics of this struggle."

Deputy and former minister Yannis Kefaloyiannis reiterated his statements during the Political Council meeting stressing that unity should be restored on the party leadership level."

"The strength of democracy and of New Democracy is dialogue," said deputy Evangelos Meimarakis while Vassilis Mihaloliakos criticized Mr. Mitsotakis for an "unfortunate intervention which embittered party supporters."

"The party should do better and all senior officials together with Mr. Mitsotakis and Mr. Evert should contribute in this direction," deputy and former minister George Sourlas said.

[20] Reppas denies linkage between continental shelf, territorial waters issues

Government spokesman Dimitris Reppas yesterday said there was no association between the delineation of the continental shelf and the expansion of Greek waters to 12 miles in the Aegean. He was commenting on Alternate Foreign Minister George Romeos' statements, Wednesday, that "if Turkey referred the issue of the delineation of the Aegean continental shelf to the International Court at The Hague, the verdict might also resolve the 12-miles issue."

Mr. Romeos was speaking during an interview with the Greek services of the BBC.

"The issue of the expansion of our territorial waters - which Greece can enact at any time it wishes - has nothing to do with the delineation of the continental shelf," Mr. Reppas said.

[21] Education ministry denies reports of plans to privatize universities

Education Minister George Papandreou yesterday denied persistent claims by university rectors that the government intended to proceed to turning universities into private corporate entities after the process of constitutional revision underway is complete d.

He said the ministry supported the public character of education and its only proposal to the relevant constitutional revision committee concerned provisions that would give the right of setting up higher educational establishments to local government organizations and public corporate bodies.

The measure, he added, aimed at promoting the overall competitiveness of universities. Mr. Papandreou accused certain rectors of resorting to populism by releasing a supposed ministry document on Wednesday, according to which the ministry proposed turning universities into private corporate entities. Nevertheless, during a press conference yesterday, Athens Polytechnic rector Nikos Markatos reiterated his belief that the ministry planned to privatize universities.

Meanwhile, Education Under-secretary George Paschalidis also stated his support for the public character of universities, adding that the relevant decision would be made by the next parliament. Macedonia-Thrace Minister Philippos Petsalnikos, a former alternate education minister, described the supposed ministry document as fake, adding that the government and himself, personally, were opposed to private universities.

[22] Greek scientists unconcerned about Chernobyl incident

A top scientists at Athens' Dimocritos nuclear research facility said that yesterday's accident at the infamous Chernobyl plant should "not be a cause for concern."

"These types of accidents are repeatedly recorded every year," said Panayiotis Kritidis, a nuclear physicist and director of Dimocritos' Environmental Radiation Laboratory.

Prof. Kritidis said the accident was completely "internal" inside the Ukrainian plant's No. 4 reactor and that no radiation was leaked, even within the nuclear station.

Representatives of the internationally active environmental group Greenpeace also concurred with the assessment, adding however, that the significance lies in the fact the accident occurred in the same reactor that exploded 10 years ago, sending thousands of tons of radioactive materials into the atmosphere.

[23] Athens rally marks 10th anniversary of Chernobyl disaster

A memorial event was held in Ermou Street yesterday for the victims of the Chernobyl accident on April 26, 1986.

The Mediterranean SOS Network, in co-operation with many other ecological organizations throughout Europe, undertook to remind the public of the tenth anniversary of the accident which resulted in 17,000 square kilometers of land being contaminated with radioactivity.

Members of the Network gathered at Syntagma Square wearing white masks with the radioactivity sign painted on them and holding banners with slogans such as "one Chernobyl is enough" and "Ten years since Chernobyl".

The main subject of discussion during the gathering was the radioactive leak which occurred yesterday at the Chernobyl reactor.

"Now we are beginning to see the consequences on a European level," said N. Chrysogelas, a member of the Mediterranean SOS Network. He stressed that over the next ten to 15 years, there will be an increase in the rates of leukemia and thyroid cancer.

Mr. Chrysogelas characterized yesterday's radioactive leak as symbolic, and added that only four per cent of radioactive material in the reactor has leaked out until today.

According to Mr. Chrysogelas, 180,000 kilos of radioactive material, including 1,000 kilos of plutonium, are still inside the reactor, which is now cracked and will not last for more than six years, while plutonium lasts for 24,000 years.

[24] New Greek intelligence head takes office

In a ceremony attended by Interior Minister Akis Tsohatzopoulos, 56-year-old retired Lieutenant General (Air Force) Haralambos Stavrakakis was installed as the new head of the National Intelligence Agency (EYP).

Mr. Stavrakakis served for two years in NATO regional headquarters in Italy, and deputy Air Force and General Defense Staff chief until 1990, when he retired. He also participated in the teams that negotiated the granting of facilities to the US Armed Forces in Greece, and confidence building measures with Turkey.

[25] Premier stresses need for European-wide transport links

In a message to a two-day conference on the development of transport links between Western Europe, the Mediterranean, and the Black Sea, which opened at the Evgenidion Foundation in Athens yesterday, Prime Minister Costas Simitis said the infrastructure l inking the three regions with central Europe was inadequate, and that co-operation in the field would bring collective benefits to all countries.

Addressing the conference, Transport and Communications Minister Haris Kastanidis described as "of major importance to the functioning of international networks" the Egnatia highway across northern Greece, the road axes from Patra to the Greek-Bulgarian border, from Helsinki to Alexandroupolis in Thrace, and from Berlin to Thessaloniki, via Dresden, Prague, Bratislava, Budapest, Kraiova, and Sofia.

President of the Greek Chamber of Transport Associations Mr. M. Adamantiadis praised the role of the European Commission in encouraging and supporting initiatives for the modernization of transport systems with the participation of private and public organizations, and stressed that "Greece and the continuously modernized transport industry has important services to offer in the broader region".

The conference is being attended by the president of the Union of European Chambers Negre Villavejia, the transport ministers of Turkey, Georgia, and Armenia, and the transport undersecretaries of several Balkan nations.

[26] Premier chairs meeting on new employment measures

Prime Minister Costas Simitis yesterday chaired a ministerial meeting on the new draft bill designed to tackle unemployment.

Labor Minister Evangelos Yiannopoulos said the bill, which took a long-term view of the problem, would be discussed by the Cabinet, and then a process of dialogue would seek to elicit the views of the 'social partners' before the bill reached parliament next month.

Sources say that the bill's central idea is the introduction of an employment card for every worker, that will aim at charting the course of the labor market.

Another basic idea is that of linking employment with training, particularly with reference to the needs of large projects. Firms will be able to undertake training programs for the unemployed, under the obligation of employing about 30 per cent of those enrolling for at least nine months.

An important element of the bill is the aim to initiate the procedure for the legalization of foreign workers in the country.

[27] Gov't to continue to strictly follow present economic policy, high- level meeting decides

A top-level government meeting on the economy decided yesterday not to introduce new measures but to strictly adhere to implementing the present policy with the primary goal of bringing inflation down.

The meeting was attended by National Economy Minister Yiannos Papantoniou, Finance Minister Alekos Papadopoulos, Development Minister Vasso Papandreou and Bank of Greece Governor Lucas Papademos.

The main point of discussion at the meeting, during which the targets already set were reconfirmed, was the course and prospects of the economy, with particular emphasis on inflation and the public deficits. No statements were made after the meeting.

[28] Reactions

A New Democracy announcement said that it was common knowledge that inflation has overshot the government's original targets, according to which it would have been at 5 per cent by the end of the year. The announcement added that incomes policy had been based on this target.

"Today, the national economy minister recognizes that this target is unfeasible as, as he accepts, inflation will not be reduced below 7.5 per cent," the announcement said.

ND said that this failure is despite the austerity policy being followed, and despite the policy which has appreciated the drachma against the ECU by four drachmas in as many months.

The ND announcement attributed the inflationary pressures to "ca-pricious government policy, which is particularly characterized by excessive increases in DEH (Public Power Corporation) and OTE (Hellenic Telecommunications Organization) bills, as well a s by over-inflated state spending."

Political Spring party spokesman Notis Martakis yesterday disputed "the government's expectations of a 7.5 inflation rate by the end of this year.

Mr. Martakis criticized the government for maintaining an austerity policy, lashing out against Mr. Simitis, whom he accused of "con-vening meetings to compromise his conflicting ministers instead of dealing with the heart of the matter."

Commenting on the results of yesterday's meeting, the Coalition of the Left and Progress party said "the rekindling of inflation and the deterioration of economic prospects make the need for a comprehensive redirecting of economic policy in the direction of development and the amelioration of social inequalities essential."

The announcement called on the government to inform the Greek people on the initiatives it intends to take in order "to avert the danger of even more negative developments in the course of the economy."

[29] Central bank expected to urge tighter economic policy

Governor of the Bank of Greece Lucas Papademos is expected to issue a strict warning to the government that it must adjust economic policy to combat inflation in his annual report on Monday.

On the question of monetary and foreign exchange policy, the report will refer to the problem of increased credit expansion and increased liquidity.

Credit expansion, namely new loans given by banks this year, has overshot the targets set by the Bank of Greece. The increase in credit expansion to a great degree is also due to consumer loans and loans in foreign exchange which businessmen prefer because they have substantially lower interest rates.

Mr. Papademos is not expected to announce imminent measures to restrict lending but it is certain he will outline the "tools" at the disposal of the central bank which it will use when it considers necessary. He will also refer to the need to continue t he hard drachma policy which counters inflation.

Regarding figures for drachma interest rates, Mr. Papademos is expected to insist that their decrease should be gradual and should follow the decrease in inflation, provided it exists.

The Bank of Greece does not intend at present to raise interest rates due to a recent rise in inflation; it shares the finance ministry's policy of lax monetary policy.

End of English language section.