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Athens News Agency: Daily News Bulletin in English, 99-11-09

Athens News Agency: Daily News Bulletin in English Directory - Previous Article - Next Article

From: The Athens News Agency at <>


  • [01] IMF welcomes Greek progress but urges freer economy
  • [02] Papantoniou-Solbes talks centre on timetable for Greece's EMU entry
  • [03] Electricity liberalisation bill to parl't soon
  • [04] Stocks power ahead on market outlook
  • [05] Drachma rampant in heavy demand
  • [06] Bonds rise in light trade
  • [07] Group acquires stake in Duty Free Shops
  • [08] Mutual fund assets rise
  • [09] Athens Foreign Exchange
  • [10] Tsohatzopoulos: Clinton visit represents an important political moment for Greece
  • [11] `Intervention` clause leads to Greek reservations at Socialist Int'l meeting
  • [12] Canadian FM Axworthy on two new agreements between Athens, Ottawa
  • [13] Praise for OA at Athens conference

  • [01] IMF welcomes Greek progress but urges freer economy

    Athens, 09/11/1999 (ANA)

    The International Monetary Fund (IMF) yesterday acknowledged progress made by the government in streamlining the economy but urged deeper structural reform to achieve greater liberalisation.

    In its latest country report on Greece, the IMF said that more reform was needed mainly in the labour and social insurance sectors, and the pace of change should be faster.

    At the same time, fiscal and incomes policy must remain tight in order to avert a rekindling of inflation, the report said.

    Greek monetary authorities had consistently pursued stabilisation policies that had created a virtuous cycle essential to Greece's planned entry into the European Union's euro zone by January 1, 2001, and the results were impressive, the IMF said.

    "Growth is strong, nominal wage rises are moderate, fiscal developments are better than forecast, and inflation has dropped markedly," the report said.

    But the challenge the country had to face was attaining a low rate of inflation on a lasting basis while improving the mid-term outlook for growth and employment.

    The economy was likely to meet the Maastricht inflation criterion following implementation of a successful macroeconomic policy coupled with cuts in indirect taxes and other administrative measures.

    At the same time, the steps might only have a passing impact.

    They could not replace a more fundamental approach to achieving a sustainable reduction in inflation, which were a tight fiscal policy, continuing wage restraint and long-term structural reform to boost competitiveness and raise productivity.

    The IMF also praised the country's strict monetary policy, backing the contention of monetary authorities that the policy should remain in place as long as needed to ensure convergence with the EU.

    However, monetary policy would slacken in the future due to falling interest rates as part of the convergence process.

    In order to offset the relaxation, authorities should employ other tools in the form of fiscal, incomes and structural measures in order to attain entry into the 11-member euro zone with a sustainably low inflation rate.

    The IMF forecast that at the end of 2000 and early in 2001, inflation would revert to a rising trend.

    It also said that wage rises should follow increases in per unit labour costs in the euro zone.

    Although the Paris-based organisation welcomed the government's policy of privatisation and part-flotations for state firms, it underlined the economic burden of carrying inefficient public enterprises.

    In addition, the state sector still dominated certain fundamental markets, which should be liberalised as soon as possible.

    While growing competitiveness in the banking sector had a positive aspect, risks for the banks themselves had increased due to credit expansion. Another problem faced by the economy was high unemployment. Measures that could be adopted included a lower starting wage for the newly recruited and the creation of more private sector job search agencies.

    The report forecast that gross domestic product would rise by 3.5 percent in 1999 and by 3.75 percent in 2000, topping the EU average for the fourth consecutive year.

    Greek exports were stronger, investments were high and the balance between supply and consumption remained dynamic, the report said.

    It forecast that the public debt would fall below 100 percent of gross domestic product in 2000.

    Athens News Agency

    [02] Papantoniou-Solbes talks centre on timetable for Greece's EMU entry

    BRUSSELS, 09/11/1999 (ANA - P. Pantelis)

    National Economy Minister Yiannos Papantoniou discussed the timetable for Greece's accession to the 'euro zone' on Sunday with the Spanish EU Commissioner for Economic and Monetary Affairs Pedro Solbes.

    The timetable anticipates a start to the process of Greece being struck off a list of excessively indebted countries on Nov. 29 and an end with a decision by the EU on Greece's accession at the Lisbon European Council - June 19, 2000.

    On the issue of the drachma's exchange parity, Mr. Papantoniou said after yesterday's Council of ECOFIN Ministers that no discussion was held. He said the government's exchange policy remains unchanged.

    The scenario for Greece's accession to the euro zone anticipates the process to start for striking Greece off the list of excessively indebted countries. The EU commissioner and Mr. Papantoniou confirmed that this will be done by the ECOFIN council on Nov. 29, following a proposal by the European Commission.

    Mr. Papantoniou said Greece has met fiscal criteria set for Economic and Monetary Union (EMU) and no surprise is expected over Greece being struck off the list.

    He also notified Mr. Solbes that the Greek government will submit the application for accession in early March, specifically between March 5-12. He noted that according to the discussion he had with the Spanish commissioner the following scenario is expected to be followed: The two evaluation reports on Greek accession are expected to be publicised in early May 2000 by the European Central Bank and the European Commission.

    He said the European Commission's report is considered particularly important, which will make a proposal on Greek accession to the euro at the ECOFIN meeting, which will be held by the Portuguese Presidency on June 5, 2000. The decision on Greek access ion will be taken by the "15" at the European Council in Lisbon on June 19, 2000. If all goes well, Greece will follow the EMU course for the circulation of the euro with the other 11 euro zone countries.

    Mr. Papantoniou said that fiscal criteria will be taken into consideration based on the previous year's results and there is no problem since they have been met. Figures concerning the past 12-month period will be taken into consideration for the criter ia concerning inflation and interest rates.

    Already during the seven-month period (including October) harmonised inflation in Greece is running at 2 to 2.1 per cent and meets the criterion set by EMU. Mr. Papantoniou believes that the decrease in interest rates will not affect inflation by next March.

    Athens News Agency

    [03] Electricity liberalisation bill to parl't soon

    Athens, 09/11/1999 (ANA)

    The government is to send a bill to parliament in coming days that will allow deregulation of the country's electricity market, in line with European Union rules, Development Minister Evangelos Venizelos said yesterday.

    Under the terms of the bill, private concerns will have the right to produce electricity from February 2001, ending a monopoly held by the state- owned Public Power Corporation, Mr. Venizelos told a news conference.

    The bill also allows the creation of an energy regulatory body to ensure fair competition, and a new SA company to manage energy transmission and distribution.

    The Public Power Corporation will retain its status as a vertically integrated production enterprise.

    It will also remain the sole owner of the country's electricity transmission network and sole owner and manager of the distribution network, Mr. Venizelos said.

    Athens News Agency

    [04] Stocks power ahead on market outlook

    Athens, 09/11/1999 (ANA)

    Equity prices surged above the 5,700 level yesterday helped by renewed confidence among investors over the outlook for the Greek market.

    Traders said the market could again test the 6,000 level in the short- term.

    Commenting on recent speculation over a realignment of the Greek drachma's central parity against the euro, analysts said that such a move could have a favourable impact on the stock market.

    The general index ended 2.42 percent higher at 5,753.60 points, at the day's highs. Turnover was 362 billion drachmas.

    Other sector indices ended as follows: Banks (+1.05 pct), Leasing (+0.42 pct), Insurance (-0.81 pct), Investment (+4.12 pct), Construction (+6.80 pct), Industrials (+3.93 pct), Miscellaneous (+1.04 pct) and Holding (+3.45 pct).

    The parallel market index for smaller capitalisation stocks ended 3.80 percent higher while the FTSE/ASE 20 index for blue chip and heavily traded stocks rose 1.51 percent to 2,861.41 points.

    Broadly, advancers led decliners by 266 to 39 with another 16 issues unchanged.

    A total of 80 shares ended at the day's 8.0 percent limit up, while Duty Free Shops, Olympic Catering and Allatini Ceramics ended at the day's limit down.

    DIS and Macedonian Spinning Mills were the most heavily traded stocks.

    National Bank of Greece ended at 22,100 drachmas, Alpha Credit Bank at 25, 390, Commercial Bank at 23,900, Titan Cement (common) at 42,400, Hellenic Petroleum at 5,150, Intracom at 14,950, Panafon at 3,760 and Hellenic Telecoms at 6,705.

    Athens News Agency

    [05] Drachma rampant in heavy demand

    Athens, 09/11/1999 (ANA)

    In the foreign exchange market, demand for drachmas again fuelled the market on talk of an impending adjustment of the currency's central parity in the European Union's ERM II.

    The demand drove up the drachma against the euro in regular trade, prompting the central bank to step into the market in a bid to stem the ascent.

    The Bank of Greece bought around 400 million euros to try to bring down the national currency, which still ended higher.

    At the central bank's daily fix, the euro was set at 328.300 drachmas from 328.550 drachmas a session earlier and 328.650 drachmas on Thursday.

    The dollar nosed down against the drachma.

    The US currency was set at 315.150 drachmas from 316.120 drachmas in the previous session and 313.480 drachmas on Thursday.

    Athens News Agency

    [06] Bonds rise in light trade

    Athens, 09/11/1999 (ANA)

    Secondary market bond prices yesterday rose again after gaining around 60 basis points in the previous session in buying fuelled by hopes of a realignment of the drachma's central parity in the European Union's exchange rate mechanism II.

    Active in the market were institutional investors from abroad, who would benefit from the rumoured alignment, which monetary authorities say may be considered next year.

    Prices on Friday regained end-September levels before the market slumped, in one session hitting zero turnover.

    The benchmark 10-year bond showed a yield of 6.45 percent to 6.47 percent 6.52 percent taking the yield spread over German bunds to 152-154 basis points from 157 basis points a session earlier.

    Electronic trade was light at 19 billion drachmas from 45 billion drachmas in the previous session.

    Buy orders accounted for 17 billion drachmas of turnover.

    Athens News Agency

    [07] Group acquires stake in Duty Free Shops

    Athens, 09/11/1999 (ANA)

    A consortium of 10 Greek and foreign companies on Friday won an international tender for the purchase of a 25.25 percent equity stake, worth 54.6 billion drachmas, in Hellenic Duty Free Shops from Agricultural Bank of Greece (ATE).

    The consortium comprises Germanos ABEE, Folli-Follie AEBE, Sarantis ABEE, Sanitas Sanitas SA, Intrapar SA, Elmec Sport ABETE, Dorian Bank, Aer Rianta International, Gebr Heineman and Jacques Parson BV.

    The group acquired 9,500,000 shares in Hellenic Duty Free Shops at 5,750 drachmas each through a block trade on the Athens Stock Exchange. The deal envisages that the owner of the minority stake will gain control of Duty Free Shops' management.

    PriceWaterhouseCoopers and ATE Finance acted as consultants to the sale.

    Duty Free Shops operates 37 outlets in Greece's international airports, ports and border stations selling tobacco, spirits and cosmetics.

    Hellenic Duty Free Shops reported sales of 54.2 billion drachmas and pre- tax profits of 18.5 billion drachmas in 1998.

    In the first half of 1999, turnover totalled 22.7 billion drachmas and pre- tax profits were 8.1 billion drachmas. The company's staff totals 410. The firm has the right to operate duty free shops in Greece for a period of 50 years, beginning January 1, 1998.

    Athens News Agency

    [08] Mutual fund assets rise

    Athens, 09/11/1999 (ANA)

    Mutual fund assets totalled 12.205 trillion drachmas on Friday, November 5, an increase of 35.7 percent from the start of the year, Ionian Bank said yesterday.

    Expectations of a new rally on the Athens Stock Exchange have been fuelled by the economy's favourable outlook, forecasts of a further fall in inflation despite a rise in October, and talk of a realignment of the drachma's central euro parity.

    Such a prospect could lead to a new rally in equity mutual fund assets, already up 941.5 percent on the year, analysts said.

    They forecast that 1999 would be a landmark year for the mutual fund market.

    The analysts noted, however, that prospects of accelerated growth in the European Union, a powerful economy in the US, and a steady recovery in Japan also created a favourable outlook for international stock markets, a combination which could lead inves tors to mainly European equity mutual funds.

    Athens News Agency

    [09] Athens Foreign Exchange

    Athens, 09/11/1999 (ANA)

    Bank of Greece closing rates of: November 8, 1999

    Parities in Drachmas

    Banknotes             Buying  Selling
    US Dollar             312.629 319.877
    Can.Dollar            212.209 217.129
    Australian Dlr        200.186 204.827
    Pound Sterling        507.269 519.030
    Irish Punt            413.520 423.108
    Pound Cyprus          564.527 577.616
    Pound Malta           739.010 769.802
    Turkish pound (100)     0.060   0.062
    French franc           49.649  50.800
    Swiss franc           202.234 206.923
    Belgian franc           8.073   8.260
    German Mark           166.514 170.375
    Finnish Mark           54.774  56.044
    Dutch Guilder         147.784 151.211
    Danish Kr.             43.801  44.816
    Swedish Kr.            37.541  38.412
    Norwegian Kr.          39.549  40.466
    Austrian Sh.           23.667  24.216
    Italian lira (100)     16.819  17.209
    Yen (100)             294.158 300.978
    Spanish Peseta          1.957   2.003
    Port. Escudo            1.625   1.663
    Foreign Exchange      Buying  Selling
    New York              312.629 319.877
    Montreal              212.209 217.129
    Sydney                200.186 204.827
    London                507.269 519.030
    Dublin                413.520 423.108
    Nicosia               564.527 577.616
    Paris                  49.649  50.800
    Zurich                202.234 206.923
    Brussels                8.073   8.260
    Frankfurt             166.514 170.375
    Helsinki               54.774  56.044
    Amsterdam             147.784 151.211
    Copenhagen             43.801  44.816
    Stockholm              37.541  38.412
    Oslo                   39.549  40.466
    Vienna                 23.667  24.216
    Milan                  16.819  17.209
    Tokyo                 294.158 300.978
    Madrid                  1.957   2.003
    Lisbon                  1.625   1.663
    Athens News Agency

    [10] Tsohatzopoulos: Clinton visit represents an important political moment for Greece

    Athens, 09/11/1999 (ANA)

    National Defence Minister Akis Tsohatzopoulos stressed yesterday in light of US President Bill Clinton's visit this week to Athens that Greece's strategic interests called for a "substantive, mature and wholesome dialogue" with Washington.

    Mr. Tsohatzopoulos spoke during an event at an air force facility northwest of Athens, which marked the culmination of the four-day celebrations for Archangels Michael and Gabriel, the patron saints of the Hellenic Air Force.

    Commenting on possible reactions during the Clinton visit, the Greek defence minister referred to excessive concern and "intentional petty-party politics".

    He also said the US president's visit represented an important political moment for the course and role of Greece in the broader geopolitical region, while the Greek government, "beyond any sentimental reactions",, will discuss with the US side the comp lete peace strategy that Athens is promoting in the eastern Mediterranean, the Middle East, the Caucasus and the Balkans.

    "...We need to take steady steps on the basis of a clear strategy which promotes the interests of both Greece and Cyprus," Mr. Tsohatzopoulos said.

    Gov't condemns incidents : Meanwhile, the government yesterday condemned the strafing of the Hellenic American Union building in downtown Athens over the weekend.

    Two suspects on a motorbike fired six shots at the building before speeding off, only breaking a few windows.

    "It may appear that there was no security (at the building) but don't be too sure about this," government spokesman Dimitris Reppas added, responding to a question as to why the site was unguarded.

    US reaction : WASHINGTON (ANA - T. Ellis) - Additionally, US State Department spokesman Jamie Rubin was also asked about the incidents in Athens during a regular press briefing here.

    He condemned the attacks against the Hellenic American Union building and a Levi Strauss office in northern Athens.

    "Let me start by saying we deplore and condemn these acts of violence. We are obviously working very, very closely with Greek authorities, as we do in all visits of this kind by the president. I can' get into the details of any decisions with respect to security that the president and the Greek government may make, but I can say that we are continuing to work with the Greek government and obviously security is a major issue," he said.

    "...we have a public announcement that's active right wou-ldn't surprise me if we had an updated version of our travel announcement shortly, taking into account this information," he said, responding to a question regarding travel by US citizens in Greece.

    Protest : Finally, protests against Mr. Clinton's visit began yesterday with a mock "people's court" at Syntagma Square and a peaceful protest march to the US embassy afterwards.

    Besides Mr. Clinton, the 20 leaders of forces participating in the NATO bombings against Yugoslavia, including Prime Minister Costas Simitis and UN Secretary General Kofi Annan, were also villified.

    Gov't: Details of Clinton's itinerary released later in the week: Details of US President Bill Clinton's visit to Greece will be released later this week, government spokesman Dimitris Reppas said yesterday.

    Responding to questions, Mr. Reppas said there would be no interference with any protests organised, provided these were peaceful and legal.

    "All the requisite measures have been taken so that no problems are created, " the spokesman said.

    Expressions of political beliefs are under no restriction in Greece, he said, adding however, that it was the concern of all that to ensure normality and the property of the state and the public.

    Newspaper poll on upcoming Clinton visit : An overwhelming 80.5 per cent of recipients in a latest poll reportedly have a negative opinion of US President Bill Clinton, regardless of their political leanings, while 92.4 percent do not trust his mediation in Greek-Turkish affairs.

    The results emanate from a poll published yesterday in the Athens daily "Ethnos". The poll shows that 86.5 per cent of recipients in Greece have a negative opinion of Mr. Clinton, and 12.2 per cent had a positive opinion, while 7.3 per cent did not answ er.

    The nay-sayers included 83.3 per cent of ruling PASOK party voters (10.8 percent positive) and 86.4 per cent of Left-wing party voters (7.9 per cent positive), while only 18.6 per cent of main opposition New Democracy voters said they had a positive opi nion and 75.3 per cent had a negative opinion.

    On confidence for Mr. Clinton's mediation in Greek-Turkish affairs, an overall 92.4 per cent replied negatively.

    With respect to parties, 60.6 per cent of PASOK voters, 57.2 per cent of ND voters and 74.9 per cent of Left-wing voters stated "no confidence", 3.8 per cent, 7.3 per cent and 5.7 per cent, respectively, stated "a great deal of confidence", and 33.6 percent, 34.9 percent and 18.6 percent stated "little confide nce".

    Asked to comment on the timing of the Clinton visit under the present conditions, 61.2 per cent said it should be postponed, 24.1 per cent agreed with the timing and 14.7 per cent did not reply.

    With respect to parties, 56.3 per cent of PASOK voters, 64.1 per cent of ND voters and 64.4 per cent of Left-wing voters said it should be postponed.

    To the question whether the Clinton visit will benefit or harm the Simitis government, public opinion was split three ways, with 30.1 per cent believing it will benefit the government, 32.1 per cent saying it will harm the government and 37.8 percent pro viding no answer.

    Athens News Agency

    [11] `Intervention` clause leads to Greek reservations at Socialist Int'l meeting

    PARIS, 09/11/1999 (ANA - G. Papachristos)

    The Greek ruling party's delegation yesterday expressed reservations at a Socialist International conference here over inclusion of a reference in a final declaration favouring outside intervention in a country for "humanita rian reasons".

    The PASOK delegation, headed by Premier Costas Simitis, expressed a view that an amendment should be incorporated in the relevant provision according to which any intervention should be in compliance with international law and United Nations resolutions .

    After similar reservations were voiced by the Swedish Socialist Party, a reference was added to the declaration according to which "interventions undertaken for humanitarian reason" should be within the context of international law.

    On the sidelines of the conference, Mr. Simitis had successive meetings with other socialist leaders, including French Premier Lionel Jospin, with whom he raised the issue the issue of EU enlargement with reference to the Turkish candidacy. The Greek pr ime minister stated later that "we seek the application of procedures and rules (regarding both enlargement and the bestowing on Turkey of candidacy status) that may prevent the occurence of problems after enlargement".

    Greek sources expressed satisfaction with what they described as a "certain rapprochement" of the views of the French leadership with Greek positions on the issue, and after contacts with Mr. Simitis and FM George Papandreou.

    During such contacts, the two governments agreed to prepare a joint proposal on the issue of any possible Turkish candidacy.

    Mr. Simitis is due to meet French President Jacques Chirac this afternoon.

    Simitis address : In his speech to the 21st Socialist International conference, the Greek PM said socialists had to focus their conflict with conservatives on areas beyond that of the economy, stressing that promotion of freedom, equality and social solidarity are also nec essary.

    "The question as to how democratic socialism can become reality in the era of globalisation has been answered, and the answer is simple: socialism is a never-ending process. It entails the improvement of daily life and it simultaneously tries to confront old and new problems as best as possible. But it needs to constantly broaden its playing field in order to improve the life of citizens today," he said.

    Athens News Agency

    [12] Canadian FM Axworthy on two new agreements between Athens, Ottawa

    Athens, 09/11/1999 (ANA)

    Canadian Foreign Affairs Minister Lloyd Axworthy has announced that Ottawa and Athens have as expected signed two new agreements, namely, a bilateral extradition treaty and a memo of understanding in sports, according to a Canadian embassy announcement yesterday.

    Both agreements were signed by Mr. Axworthy and his Greek counterpart George Papandreou, during his recent official visit to Canada.

    The extradition treaty replaces an agreement that dates back to 1912. Under the new pact, extradition proceedings between both countries will be facilitated.

    "This treaty complements the Canada-Greece Treaty on Mutual Legal Assistance in Criminal Matters, signed last year in Athens. The signing of the Extradition Treaty constitutes a concrete and constructive step toward enhanced co-operation between our cou ntries in the fight against transnational crime," Mr. Axworthy said.

    In terms of the sports memorandum, he said that "with the 2004 summer Olympics being held in Athens, further cooperation between Canada and Greece in the field of sport is both timely and welcome."

    Athens News Agency

    [13] Praise for OA at Athens conference

    Athens, 09/11/1999 (ANA)

    State-run Olympic Airways is reportedly rated third in terms of the safest airlines world-wide and in regards to flight control, according to results presented at an international conference on flight safety in Athens recently.

    The high ratings for debt-ridden Olympic Airways and Greek airports were apparently confirmed after an inspection recently concluded by the US Federal Aviation Authority.

    Participants at the conference said that after 1992 there was an increase in air incidents in Greece due to increased air traffic and the emergence of several highly competitive private carriers.

    Despite a 27 per cent increase in air travel during 1988-1998 world-wide, accidents dropped by 12 per cent per one million passengers.

    Athens News Agency

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