Athens News Agency: Daily News Bulletin in English, 10-09-29

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From: The Athens News Agency at <http://www.ana.gr/>

CONTENTS

[01] FM Droutsas addresses UN General Assembly

[02] FM Droutsas holds talks with Archbishop of America

[03] PM chairs meeting on 2011 budget; stresses that alert 'isn't over'

[04] No new austerity measures for 2011, gov't repeats

[05] PM meets new US ambassador, European Commissioner Malmstrom

[06] Deputy FM Kouvelis in Seoul

[07] Environment minister to visit Cyprus Wednesday

[08] Memorandum for 'greener' armed forces signed

[09] Top ND meetings focus on upcoming regional election

[10] Former PM Costas Karamanlis sends memorandum on Vatopedi case

[11] ND, LA.OS spar over memorandum

[12] Dep. FM Dollis meets with SAE president

[13] Tsipras sharply criticises Alavanos

[14] New ambassadors present credentials

[15] New Israeli envoy

[16] Parliamentary inquiry into Siemens scandal extended until Oct. 20

[17] Mantelis' alleged accomplice released on bond

[18] Justices' union criticises statement by Parliament com't chair

[19] Gov't, banks reach deal to boost liquidity in local market

[20] Papademos: Return to markets in 2011 highly likely

[21] Economic Chamber publishes report on Greek banking sector

[22] Stricter penalties against tax evasion eyed

[23] Employment minister holds talks with Internal Affairs Commissioner

[24] Minister rejects closing of outstanding cases involving building code violations

[25] Work stoppages in public transport on Wednesday

[26] Stocks end 1.59% lower

[27] Greek bond market closing report

[28] ADEX closing report

[29] Foreign Exchange rates - Wednesday

[30] Major archaeological find on Crete

[31] Retrospective exhibition of paintings by Loukas Venetoulias

[32] World renowned filmmaker Theo Angelopoulos honored in Adana film festival

[33] Cargo ship searched for illegal weapons, systems

[34] Thessaloniki man shot by armed robbers

[35] Protesting truck owner arrested for attack on foreign driver

[36] Arrest on Crete on gun possession charges

[37] Rainy on Wednesday

[38] The Tuesday edition of Athens' dailies at a glance

[39] President: Solution of Cyprus problem a life-long goal Politics

[01] FM Droutsas addresses UN General Assembly

Greek Foreign Minister Dimitris Droutsas, addressing the sixty-fifth session of the General Assembly of the United Nations on Tuesday evening, outlined Greece's positions on the issue of Cyprus, the name of the Former Yugoslav Republic of Macedonia (fYRoM), Greek-Turkish relations, the situation in the Balkans, the Middle East and on global security and peace in general.

Droutsas reiterated Greece's readiness for substantive negotiations aimed at a solution to the problem of fYRoM's name, calling in parallel on the neighbouring country's Prime Minister Nikola Gruevski to become "part of progress."

On the issue of Cyprus, he called for the withdrawal of Turkish occupation troops, underlining that it is a question of political will and determination.

Droutsas stressed the need for cooperation between Greece and Turkey so that the negotiating process can be supported and promoted effectively with the aim of achieving a bizonal, bicommunal federation solution based on the resolutions of the UN and on European principles.

As regards Greek-Turkish relations, he emphasised that International Law is the only basis for settling differences with peaceful processes, noting that a possible path is resorting to the Hague International Court.

Following are extensive extracts from Doutsas's statement:

"I would like to thank the outgoing President of the 64th Session of the General Assembly, Mr. Ali Abdussalam Treki of Libya for his tireless efforts in taking forward the work of the GA and to congratulate Mr. Joseph Deiss of Switzerland for his election as President of 65th Session of GA.

"I am confident, Mr. President, that you are uniquely placed for the challenging tasks ahead. I can assure you of Greece's unwavering support in your efforts.

"I would also like, at this point, to fully align my country's positions with those expressed in the statement by the European Union.

"Given the nature of today's global challenges, I think we can safely assert that "Upon the conduct of each state depends the fate of all".

"This, I believe, goes also to the substance of the key theme proposed by you, Mr. President, for this General Debate, that is, the central role of the United Nations, with emphasis being placed on the notion of global governance.

"Herein lays the real issue, that is, on the need to reaffirm the necessity of global governance in order to deal effectively with the challenges that the world community faces today. If each of us can fully comprehend and thereby accept this seemingly self evident assertion, then there can be no doubt as to the central role of the United Nations in this process.

"In this regard, I think that we can all agree that the United Nations is the only global entity which commands universal legitimacy and it is the organization to which we should all look and actively support in order to provide collective and, therefore, optimal solutions to the ever growing array of multifaceted issues that we are confronting.

"The idea of global governance, however, is much more than this. Although it is difficult to imagine that this notion would entail the creation of Hobbes' "Leviathan" on a global scale, it nevertheless remains a fact that meeting the needs of our peoples increasingly transcends the abilities of individual nation states.

"This is where the role of the United Nations comes to the fore, and this is why our discussions on the reform and revitalization of this organization are of paramount importance.

"At the same time, we, the individual member states of the UN, must pool our resources, expertise and know-how, and act as a coherent whole, as this is the essence of global governance. Our efforts in this regard must focus on two fundamental pillars:

(a) increasing the membership of the Security Council with both permanent and non-permanent members, which will better reflect today's global socio-economic and political realities, as well as enhancing the role of the General Assembly and the interaction between these two bodies, and

(b) enhancing and improving the cooperation and coordination of the UN with other major international and regional organizations, with the goal of making multilateralism work effectively to the benefit of our peoples.

"In the past few months, we have witnessed the devastating effects of natural disasters in many places around the world stemming from Haiti to Russia and from Pakistan to Guatemala.

"What clearly sets them apart from natural disasters of the past is the number of people they affect. 2010 is on track to setting a negative record in the amount of victims claimed by natural disasters.

"In recent years notable progress has been made in this field, particularly by the UN and its specialized agencies, not least of which was the establishment of the Central Emergency Response Fund (CERF). This year, we must focus our efforts on further improving the mechanisms necessary for emergency responses, including through the effective cooperation between the UN and those regional or international organizations with the necessary capabilities to support relief operations.

"Climate change is the world's greatest environmental challenge. We all know that it will increasingly affect all aspects of our lives including peace and security.

"It is our duty to lead the world into a new "Green Era" and to guarantee to the next generations a better and more prosperous future.

"The Copenhagen Accord represents a basis on which we can work further. Our aim should be an ambitious, comprehensive, balanced, and legally binding agreement, supporting adaptation efforts of the most vulnerable countries and opening the door to a future of environmentally sustainable growth. We need to focus now all our efforts in order to secure a successful outcome from the upcoming COP 16 Summit in Cancun.

"We strongly believe that action must not stop. The Greek Government proposes to initiate a new Mediterranean Climate Change Initiative, in close collaboration with Mediterranean countries strongly committed to climate and energy security. A formal launch of the initiative is planned on 22 October 2010 in Athens ahead of the UNFCCC COP16 meeting in Mexico.

"In the same vein, the central theme of our Chairmanship-in-Office of the Black Sea Economic Cooperation is "the Black Sea turns Green." This is not based on a narrow view of environmental sensitivity; it is a development-oriented choice based on the firm belief that streamlining green technology, proper resource management and environmental stability, can and will be a platform for regional cooperation, business, entrepreneurship and employment creation.

"Add to this that by streamlining development to environmental protection, we conserve and put to value the comparative advantages of our region, its landscapes, its sea, its freshwater, its biodiversity, the basis for its future development through tourism, agriculture, fisheries etc.

Global economic crisis

"The recent global economic and financial crisis has left few countries unaffected, Greece having been no exception. Both advanced economies, as well as emerging ones, are having to adjust to the realities created by the "butterfly effect" associated with the almost indivisible interrelation of our economies, in a world for which we need to find a new term for the notion of "globalization".

"It has become increasingly apparent to all of us that the current international financial system has serious disadvantages that have to be corrected. One of the goals of the recent G20 summits was to reform the global financial system in order to avoid similar unpleasant situations in the future.

"These efforts are necessary not only to sustain economic growth, but also because "glitches" in the world's financial markets have far reaching adverse effects on our collective ability to move forward and meet our internationally agreed global development targets.

"In this regard, I would like to welcome the results of the High Level Meeting on the Millennium Development Goals and to commend the UN Secretary General for his timely initiative.

"Closely related, of course, to the achievement of the Millennium Development Goals, but also to the global financial crisis, is the ever growing phenomenon of international migration.

"This pressing issue has a two-fold humanitarian dimension. On the one hand, what is primarily at stake is the very safety of the thousands of people who annually put their lives at risk under extreme conditions to make the journey towards what they hope will be a better future for them and their families. Countless lives are lost every year, especially at sea, victims of ruthless traffickers who profit off the misery and despair of others.

"On the other hand, these migrants face particular difficulties at their destination, whether transit or final. The burden placed on host countries is such that migrants often find themselves in a state of limbo and marginalized from the host society. The socio-economic consequences of this, both for the host countries and for the migrants themselves are indeed very far reaching.

"For us, this is a pressing humanitarian issue that needs to be addressed collectively in all its aspects, from examining thoroughly and addressing the reasons that have led to the surge in this phenomenon, to tackling the networks of organized crime involved in the tragedy that is human trafficking.

"It was this comprehensive approach that the Greek Presidency of the third Global Forum on Migration and Development- GFMD sought to promote. During the annual meeting that took place in Athens from 2 to 5 November 2009 under the overarching theme "Integrating Migration Policies into Development Strategies for the Benefit of All", a number of important issues were covered.

"The Athens meeting, we believe, successfully contributed to the consolidation of the GFMD as a unique platform for governments to exchange views, ideas and experiences on migration and development issues and re-affirmed that the process should remain informal and state-led, underlying its multi-dimensional character and emphasizing the need to strengthen the importance of the development dimension.

"In its third year, the GFMD has proven to be more than just another international meeting on migration and development and is already shaping the debate in important ways by building bridges between countries and regions, public and private sectors and migrants and their home and host societies.

Human rights

"Over the past sixty years, the international community has made remarkable strides in the protection and promotion of Human Rights. Our United Nations has been at the forefront of an enduring campaign to place human dignity and respect for our inalienable and fundamental universal rights at the center of all our policies, both on a national, as well as on an international level. Indeed, I strongly believe that it cannot be any other way. Respect for and further advancement of Human Rights constitutes the cornerstone of our respective democracies and signals the qualitative progress and evolution of our world's civility and civilization.

"Despite progress in this field, much more needs to be done. We must identify shortcomings and concentrate on pushing forward those aspects which still lag behind.

"Greece continues to support all efforts for an effective and efficient Human Rights Council, with enhanced status, mandate, structures and membership. This is of the utmost importance for the credibility, legitimacy and effectiveness of the UN human rights system as envisaged in the Charter. In this framework, Greece will actively defend the prestige of the Human Rights Council, through its candidacy for the years 2012-2015.

"The common thread underpinning all of the aforementioned issues is the need to enhance the mechanisms necessary to ensure effective multilateral action to confront these common challenges coherently and comprehensibly. In this, the promotion of effective interaction and coordination between the UN and regional organizations must be one of our key priorities.

Security

"What is equally clear from all of the above is that our notion of security is indivisible, comprehensive and cooperative. This is the spirit within which we approached our term as Chairman-in Office of the OSCE in 2009. The demand to review our understanding of security was present, as was the need to re-examine the security architecture of an area stemming from Vancouver to Vladivostok.

"We consider the upcoming 2010 OSCE Summit as a major milestone in the European Security Dialogue, the well-known Corfu Process, launched by the Greek OSCE Chairmanship in 2009. This open-ended and wide-ranging political dialogue has established both ambitious and realistic targets in restoring confidence and trust among all 56 OSCE participating States, recapturing the spirit of partnership that brought together the founding fathers of the OSCE and enhancing solidarity and cooperation. Thanks to the commitment and engagement of our OSCE partners to the Corfu Process, the vision of the 1990 Charter of Paris for a New Europe, whose 20th Anniversary we commemorate this year, has finally the prospect to become reality in the European security landscape.

"Within the European Union, the EU Member-States have developed an elaborate array of tools and procedures, not least in the field of its external relations, which are designed to respond effectively to today's multifaceted challenges, from early warning and conflict prevention to emergency response and crisis management, reconstruction and rehabilitation.

"But what truly sets the European Union apart, particularly after the entry into force of the Treaty of Lisbon, is the degree of integration achieved between its Member-States on many levels.

"Greece has always been a staunch supporter of the European ideal. It is this belief in the cumulative power of a united continent, politically, economically and socially, and supported by a robust security component, that influences and shapes our foreign policy decisions.

"Our constant goal, along with our EU partners, without prejudice to particular national positions, is to actively and constructively contribute to the formulation of the EU's Common Foreign and Security Policy, each bringing to the table our comparative advantages and individual experiences.

"This is why, in my opening remarks, I expressed Greece's full alignment with the statement made by the EU. This is not mere "lip service" to a general statement, but a conscious political position, in that the statement circulated here truly reflects Greece's positions on the key international challenges. On this occasion, I would like to express my firm belief that the General Assembly will greatly benefit from arrangements that would allow EU representatives to fulfill their responsibilities in an effective manner at formal meetings.

Balkan region

"What goes on in our neighborhood directly affects the way our children will grow. In Greece, we have become deeply conscious of this reality. So we have made a commitment, especially to our region and to its people.

"We believe that stability in our region is the pre-requisite for security and we define stability as the practice of democracy, the strengthening of institutions that provide transparency and accountability, the reduction of economic inequalities and the rule of law in our societies and between our countries. A key factor for bringing stability and development in our region is good neighbourliness, a fundamental principle which, together with the other principles included in the Charter of the United Nations, constitutes the cornerstone of contemporary international legal order.

"Greece's security lies in being member of the European Union and of NATO and we work so that countries of the region may benefit from the stabilizing influence of their future membership in these institutions.

"The Balkans is still a sensitive area stability-wise. The dust from the dissolution of Yugoslavia has not settled yet.

"Greece's vision for the Balkans is one of a region in which democracy finally becomes the norm; where citizens' aspirations can finally be realized through peaceful and democratic practices; where the rights of minorities are respected; where governments are accountable, economies are transparent and politics allow for the fullest participation of all elements of society.

"The world has a responsibility in supporting this vision for our region. We need to empower the region that has historically been handicapped, dependent and divided by a world community of competing interests and a babble of conflicting signals.

"In our view, the prospect of the integration of the entire region into the European and Euro-Atlantic structures and institutions is the way ahead that can guarantee stability and development. The heart of the European ethos lies in building the institutions and practices of inclusiveness. That is why Greece has always supported EU enlargement, as a means to build a bridge of security, co-operation and development between nations.

"In order to breathe new life into the prospect of the integration of the Balkans in the EU, Greece has put forward a new initiative, the "Agenda 2014", which builds upon the "Thessaloniki Agenda", another Greek initiative for the region dating from 2003. The principal aim of this initiative is to set a political target to the EU accession process which will serve as a strong incentive for the whole region to put forward and speed up the necessary reforms and adaptations which will bring them closer to the EU.

"During the critical years of Yugoslavia's dissolution, the presence of the European Union in the Balkans was not adequate, with detrimental effects on the handling of the successive crises. We all know better now. There are still open wounds in our region, Kosovo being the most pressing one, and we must make sure that this time the EU will be present and with a strong voice. The European prospect of our entire region can boost the political process, which is about to begin on Kosovo. At the same time we need to keep an open and clear path for Serbia to begin accession negotiations with the EU.

FYRoM

"There are several other open issues in the Balkans. One of them revolves around the name of the Former Yugoslav Republic of Macedonia. This is not a bilateral, pedantic dispute about historical symbols, as some may try to portray it, but a regional question, with deep historical roots, related to good neighbourliness.

In order to reach a compromise on the name issue, the two sides must meet in the middle by taking reciprocal steps to bridge the gap and reconcile their conflicting positions. Greece has already done its part. A fair and lasting solution can only be based on a name with a geographic qualifier, to be used for all purposes, erga omnes. Macedonia is a large geographic region, most of which lies in Greece. A small part is in the FORMER YUGOSLAV REPUBLIC OF MACEDONIA and a smaller part in Bulgaria. The part cannot represent the whole and the FORMER YUGOSLAV REPUBLIC OF MACEDONIA's exclusive claims to the name "Macedonia" cannot be allowed to fuel nationalism. Any solution must be universally implemented because otherwise today's situation will simply be perpetuated.

"We have intensified our efforts to reach a settlement, in the context of the established UN negotiating process, led by Mr Nimetz, in the hope that this will be possible rather sooner than later.

"I chose the General Assembly, which is the natural forum to solve international disputes, to declare, once again, Greece's readiness to reach a solution even tomorrow and call upon Prime Minister Gruevski to display leadership and become our partner for progress. Progress that will result in a bright and prosperous future of our neighbours in the European Union. A future we wish to see become reality soon. To this end, I appeal to the leadership in our neighbouring country to concentrate efforts in the central aim of finding a solution, rather than waste valuable resources and energy in practices of "buying time", of creating atmosphere of antagonism or even animosity and of avoiding taking responsibilities. Greece is extending a hand of friendship and cooperation. The time has come for our neighbours to take this hand.

Middle East problem

"Let me now turn to the most serious flashpoint in the broader region, which is one of the most durable and sustained conflicts in our times. I am referring to the Arab-Israeli conflict, which is again at a turning point.

"The resumption of the direct talks was a significant achievement and we must pay tribute to President Obama and his Administration and all others who have contributed to this end as well as to the Israeli and Palestinian leadership and the leadership of the Arab countries which have supported it.

"However, this is just the beginning, not the end. The most difficult part lies ahead of us. Our number one priority now is to sustain this dialogue and make it bear fruits. Both sides have an obligation to show respect for this fragile diplomatic process. Actions that threaten its very existence, like Israeli settlement construction, must be avoided for the negotiations not to turn into one more exercise in futility.

"It is very important to reinforce the peace camps and establish a peace mindset in both sides. We must give the people hope and an optimistic perspective. We must provide them with tangible proof that the dialogue will produce concrete results which will be beneficial for all. We must convince them that the cost of the confrontation is much higher than the cost of reciprocal compromises conducive to peace. We need to persuade especially the new generations that peaceful coexistence is a viable option.

Cyprus issue

"Another equally important and long-standing issue in the Eastern Mediterranean is the question of Cyprus. I would like to thank the Secretary General and all those who labour with him towards a just solution in Cyprus: a solution based on UN Resolutions for a bi-zonal, bi-communal federation with one international personality, one citizenship and one sovereignty. A solution in full conformity with the acquis communautaire. UN Resolutions must be honoured. The implementation of UN Resolutions is not only important for Cyprus. It is important for the moral standing of the entire international community sharing common values, it is important for the moral standing of this all-important organization.

"The island remains divided, in a shameful condition. Cyprus is a tragic example of where our shared sense of justice, our shared code of values, has gone astray. The last "Berlin Wall" has to come down, not be strengthened. This responsibility rests with the United Nations and all those who have a saying in international developments. Cyprus is the victim of military invasion and remains occupied by foreign troops - this is the truth, this is reality and it must end. We need to go beyond this situation. It will take courage. Courage from everyone involved. A solution to the Cyprus problem can and should be seen as a win-win situation. It is vital for peace, stability and security in our region.

"I truly believe that the Greek Cypriot and Turkish Cypriot communities can find solutions. Greek-Cypriots and Turkish-Cypriots can live together peacefully and harmoniously in the reunited EU-member Cyprus. They must be allowed to decide freely on their common future, without external interference and pressure. And we can aid them in this process. The solution of the Cyprus question is a matter of political will, resolution and determination, such as that displayed by President Christofias, in order to give a definitive end to this protracted international problem.

"Cyprus, Turkey and Greece: for anyone willing to envision the future, our futures are as interwoven as our histories. A reunified federal Cyprus, member of the European Union, does not only serve the European aspiration for stability in the region but the aspirations of every citizen in every one of the countries involved.

"Greece and Turkey have a responsibility to cooperate on the Cyprus problem and to facilitate the process. Greece and Turkey, through their rapprochement, share a rare opportunity to help the citizens of Cyprus rebuild their island, their homes and their dreams. Turkey can prove its commitment to a lasting solution of the Cyprus issue by withdrawing immediately its occupation forces from the island, thus boosting both the negotiation process and its own European perspective.

I therefore appeal to the Turkish leadership to use this framework for a just solution.

Greek-Turkish relations

"Last but not least, allow me a quick reference to Greek-Turkish relations, which is an important parameter for the stability of the region. As you probably know, Greek-Turkish relations are burdened by a heavy historical past. Therefore, it is not an easy task to change their course and turn a long-standing rivalry into good-neighbourliness, free of the threat of the use of force, or unfounded territorial claims. Respect for international law is the sole basis for a healthy and peaceful relationship between the two countries.

"Greece has embarked on a process with Turkey that will radically affect our lives in the coming years. We have opened a dialogue. One that is honest. And although we may and do differ on many issues, such as how we see Cyprus and how we approach our bilateral relations, this open approach can only lead to a progressive resolution of our problems. The Turkish leadership and the people of Turkey know we are honest in what we say and in our desire for a new and peaceful relation. I believe that Greece and Turkey have no choice but to explore new avenues for co-operation. I believe our mutual interests can outweigh our political differences. We can and must resolve these differences through peaceful means. And a possible way to go is the International Court of Justice.

"I do not want to give the false impression that all our problems have suddenly been resolved. It is most distressing that a variety of statements and acts still undermine this very genuine and difficult effort. The long standing threat of war, the "casus belli" against my country, is unacceptable and has no place in our European and global family of values and principles.

"There are those who certainly may wish that our efforts fail. It is our historical duty to overcome these difficulties and maintain the momentum in response to our peoples' mandate for peace."

[02] FM Droutsas holds talks with Archbishop of America

The Primate of the Greek Orthodox Church of America Demetrius assured Foreign Minister Dimitris Droutsas of the "full support" of the Greek American community in these "crucial moments" that Greece is experiencing, during their meeting in the offices of the Archdiocese in Manhattan on Tuesday.

Speaking after the meeting, Droutsas said "I thank once again the Reverend for our meeting and for the time he provided for us to talk. I wish to stress, and I believe this deeply, the Reverend is a source of great experience, as well as a source of inspiration not only for me, for all of us, particularly for expatriates here in America, who are playing such an important role for Greece as well. I wanted to thank him once again for all his work here, for all his support and for all the support that he will provide for us in the future also. I must say that really, our expatriates here in America have shown in times of crisis, as the present ones are, their best self, they have helped a great deal. Once again, with the guidance of the Archbishop here, I believe that everything will turn out well for our Greece as well. And once again thank you Reverend for your time and for our good discussion today."

On his part, the Archbishop referred to the need for expatriates' full support for Greece in this relatively difficult period that it is experiencing, adding that with the discussion he also had with the minister they see that positive steps exist.

[03] PM chairs meeting on 2011 budget; stresses that alert 'isn't over'

The draft 2011 budget is due to be tabled in Parliament next Monday.

According to sources reporting on the events during the meeting, Papandreou had underlined that people's efforts must not be allowed to go to waste.

Finance Minister George Papaconstantinou, in statements to reporters after the meeting, said that the budget would be based on the things the government had done during 2010 and stressed that, while 2011 would be another very difficult year, "we are starting on a better basis".

He also categorically ruled out the mass transfer of goods from the 11 percent VAT category to the 23 percent VAT category.

Prior to the cabinet meeting, there was also a meeting between Papaconstantinou and the prime minister.

[04] No new austerity measures for 2011, gov't repeats

"There are specific promises, announced measures and the government's assurance that there will no further measures in 2010. This is a given. For 2011, not only will there not be additional measures from those foreseen in the Memorandum but the government will take all necessary actions so that the announced measures are even less severe in order to help protect the income of Greek citizens," he said.

Petalotis said there was no decision as yet on whether the revenue targets in the Memorandum would be met through higher VAT or by abolishing different prices between heating oil and diesel. "All that we know for the time being is that the solution chosen will be the one that is most favourable for low and middle income citizens," he added.

The spokesman also announced that the 2011 budget would for the first time be drafted based on the real economic figures and using a different model, in order to put the country's finances in order, produce detailed reports every quarter, with Parliament control of all figures produced by public-sector bodies and constant monitoring on whether budget targets are being met.

In reply to other questions, Petalotis confirmed that changes to education were among the government's top priorities and revealed that the government had asked banks to assist in the tax settlement measure and implementation of the tax bill.

On the Parliamentary preliminary examination of the Vatopedi monastery land swaps case, Petalotis stressed that there was no doubt that the State had suffered financial harm as a result of the transactions and that the committee simply wanted to determine precisely how much this was. He also strongly criticised New Democracy for its new line of questioning the extent to which the state had been harmed as result of the deals, stressing that this had involved both huge tracts of land and money-laundering through off-shore companies created for the purpose.

In comments on the continuing protests by truck owners objecting to the opening of their profession, Petalotis underlined that this was now a law of the state and that markets would soon start to operate more efficiently as a result.

[05] PM meets new US ambassador, European Commissioner Malmstrom

[06] Deputy FM Kouvelis in Seoul

Kouvelis held a meeting with his counterpart Kim Jae-Sin, whom he briefed on the planning and results of the Greek government's policy for an exit from the crisis and on investing opportunities appearing in Greece.

His meetings with important members of the business world were exploratory for the attraction of investments, such as with the vice president of the gigantic Hanwha Group, that extends its activities from defence to shipping and construction, and with the vice president of Samsung Electronics, with whom he discussed the possibilities of investments in the sectors of telecommunications, construction and green energy.

He also encouraged the participation of Korean businesses in the Forum for the promotion of Green Growth and Entrepreneurship that is a Greek initiative and will be held in Thessaloniki on November 26.

The deputy minister will return to Greece on September 30.

[07] Environment minister to visit Cyprus Wednesday

The two ministers will hold bilateral discussions and sign a Memorandum of Cooperation on Wednesday, which will be followed by joint statements to the press.

Birbili will also meet with the Cyprus House of Repre-sentatives' (parliament) committee on the environment, and will be received by the president of the House Marios Garoyian.

[08] Memorandum for 'greener' armed forces signed

The agreement was signed by Defence Minister Evangelos Venizelos and Environment Minister Tina Birbili, who afterward said it dealt with action in three main areas. These included replacement of technical equipment in order to comply with Community regulations on the use of asbestos, encouraging energy conservation and the use of renewable energy sources within the armed forces and exploiting natural resources such as water and recycled materials.

Birbili also announced that the environment ministry will contribute 20 million euros to assist the defence ministry's efforts to sensitise young people on environmental protection issues.

The national defence minister announced plans for a 'green development' office for every command and a 'green development' officer in every unit, adding that a special group of trainers that will sensitise armed forces personnel on environmental issues has already been set up and will be responsible for supply audiovisual material and Internet material to units.

In terms of armed forces buildings and facilities, energy conservation measures that range from energy saving light-bulbs to automated systems are to be installed and, where possible, there will be an immediate switch to natural gas and renewable energy sources. Efforts will also be made to cut water consumption by one quarter in the next three years.

In terms of waste management, Venizelos said the ministry aimed to reduce the volume of generated waste by 5 percent a year via recycling, reuse of building refuse and the "withdrawal" of armament systems and shell residues. The minister also promised that there would be careful consideration of the issue of radioactive wastes, if there were any.

Regarding the use of photovoltaics and small wind-power units by the armed forces, the two ministries are working on a special licensing regime and promoting pilot schemes for small units or islands.

Other envisaged action includes testing for military vehicles to reduce their emissions, 'green' army camps and hospitals using new technologies and other methods of reducing environment impact and action to protect biodiversity in army camps, firing ranges and areas monitored by the army (Evros).

In reply to questions, Alternate Defence Minister Panos Beglitis also stressed that alleged pollution of the Asopos River by Hellenic Aerospace Industry (HAI) was actually much less than that presented in reports.

"The work being done HAI is very significant in terms of essentially eliminating emissions and not just industrial wastes. HAI has environmental certification until 2012," Beglitis said.

[09] Top ND meetings focus on upcoming regional election

On Thursday, Samaras will convene a meeting of ND deputies, former MPs and members of the Attica prefecture political committee, in the presence of the party's candidate for the all-important Attica regional head, Vassilis Kikilias.

On Friday and Saturday, the ND president will tour the western Macedonia district, while on Sunday he will meet with visiting Chinese Premier Wen Jiabao.

[10] Former PM Costas Karamanlis sends memorandum on Vatopedi case

According to Karamanlis, the New Democracy government received "finalised" the ownership status of the Vistonida lake, in which case, "bound" by the ministerial decisions of the PASOK party "and due to the social problem that had been created for the inhabitants of the neighbouring regions and their demand that their problem be handled, as well as due to the lack of necessary resources for possible expropriations, the ND ministers, each in the framework of his duties, adopted the absolutely legal process of exchanges."

The former prime minister also assessed in his memorandum that "nothing reproachable resulted" from the two Factfinding Committees that were created for the case, "not even a shadow of suspicion of penal responsibilities for the political persons and this despite the evident animosity and prejudice that was shown by various sides."

He further noted that "four assessment reports carried out, two by the Sworn Evaluators Corps and two by foreign independent firms did not detect anything reprehensible, reproachable, neither a loss for the State. And it is leniently strange, that the existence of these reports was passed over in silence in the second Factfginding Committee, as well as the fact that only now is the carrying out of additional assessments being requested."

Karamanlis also reminded that his government had created a Factfinding Committee for the case.

Government spokesman

Government spokesman George Petalotis, in a statement on Tuesday on the letter by former prime minister Costas Karamanlis to the Parliamentary Preliminary Investigation Committee on the Vatopedi case, accused Karamanlis and the New Democracy party of "denial of reality" and of "underestimating the intelligence of citizens."

Petalotis added that "it is the right of Mr. Karamanlis not to want to reply in essence to the summoning of the Parliamentary Preliminary Investigation Committee on the scandal of Vatopedi, and the work of the Committee the assessment of his letter."

[11] ND, LA.OS spar over memorandum

Speaking on a private television, Karatzaferis maintained that his party voted in parliament in favor of the memorandum to "save" the country, while claiming that ND's affiliated MEPs did the same.

In response, ND rejected Karatzaferis' comments as being untrue and accused LA.OS of openly supporting ruling PASOK government, while a subsequent LA.OS' statement blamed ND leader Antonis Samaras' "incoherent positions for the dead end the party is in."

[12] Dep. FM Dollis meets with SAE president

Dollis will attend the Oct. 2 session to outline the government's priorities as regards Greeks living abroad in addition to issues concerning the group's operation and mission.

[13] Tsipras sharply criticises Alavanos

Alavanos is running as an independent for the Attica region, which Tsipras said is obstructing the possibility of the memorandum and government policy being disputed by the left.

Speaking to a local television station, Tsipras said that if it were not for the candidacy of Alavanos, Synaspismos candidate Alexis Mitropoulos could pass "easily" to the second round of the elections in the Attica region.

[14] New ambassadors present credentials

The new envoys are Daniel Bennett-Smith of the US, Roland Wegener of Germany, Charles Sheehan of Ireland, Mihai Balan of Moldova, and Arye Mekel of Israel.

[15] New Israeli envoy

Mekel replaces Ali Yahya, who completed his term.

Arye Mekel is a highly experienced diplomat with a long professional career in the fields of journalism and diplomacy.

Amb. Mekel began his career as a journalist in 1967, working in succession for almost 20 years as the military and political reporter for Israel Armed Forces Radio in Tel Aviv, the senior editor and political correspondent of Israel State Radio (Kol Israel) in Jerusalem and as a correspondent of Israel State Radio in the United States.

From 1976-1979 he served as the representative of the Jewish Agency in Cincinnati and was an adjunct professor of Jewish studies at the University of Cincinnati. Mekel also served for four years (1989 - 1993) as the director general of the Israeli Broadcasting Authority, which is responsible for all state television and radio in Israel.

He joined the Israeli foreign ministry in 1984 as a senior researcher, before serving as advisor to the former foreign minister and then prime minister of Israel, Yitzhak Shamir. Subsequently, he served as consul general of Israel to the southeastern US, charges d'affaires of Israel in South Korea and as an advisor to the deputy foreign minister in combating anti-Semitism. In 2003, Amb. Mekel assumed the post of deputy permanent representative of Israel to the UN and was then appointed consul general of Israel in New York (2004 - 2007).

He then became the director of the press department and foreign ministry spokesman followed by the position of deputy director general for cultural and scientific affairs before being designated as the ambassador of Israel to Greece.

The new Israeli ambassador holds BAs in political science and English language & literature from the Hebrew University of Jerusalem and MAs in sociology and mass communication from Columbia University in New York and the Hebrew University of Jerusalem, respectively.

He is married and the father of three adult children.

[16] Parliamentary inquiry into Siemens scandal extended until Oct. 20

It also voted to send an examining magistrate the Munich in order to prepare for an examination of key suspects in the case that are in Germany. The magistrate will most likely leave on Thursday, provided that Bavarian authorities agree to a Greek request for judicial assistance.

The letter to the examining magistrate from the Parliamentary committee will include the chairman's estimate that the financial damage to the Greek State as a result of the Siemens scandal exceeds the sum of two billion euros.

According to chairman Sifis Valirakis, the kickbacks represented roughly 10 percent of the total cost of Siemens contracts with the Greek State and was worked into the costs of the contract. He stressed the need for a detailed expert audit to assess the exact amount of damage incurred by the state and public-sector bodies as a result.

Opposition party MPs objected to the decision to first send an examining magistrate, saying that this was an attempt to postpone or prevent a programmed trip by the Parliamentary committee members to Germany to examine the witnesses themselves.

The committee also voted against a proposal by the Popular Orthodox Rally (LAOS) party to summon former prime minister Costas Simitis to testify, saying that this would be re-examined if new evidence arose during the examination of former Siemens executives in Germany.

[17] Mantelis' alleged accomplice released on bond

A friend of the former minister, George Tsougranis admitted in testimoney before an examining magistrate on Tuesday that he assisted Mantelis by opening a Swiss bank account under the name A. Rocos for him in 1998, to which Mantelis then transferred the sum of 200,000 German marks given to him by Siemens.

Tsougranis denied, however, that he was aware that the money had illegal origins at the time.

"His participation in the case was without guile and friendly," the defendant's lawyer stated afterwards.

[18] Justices' union criticises statement by Parliament com't chair

Valyrakis was quoted as saying that "a possible refusal to prosecute (Panaghis) Vourloumis will comprise slander against democracy and the Greek people."

The union said its board of directors unanimously expressed criticism of the statement, as "Mr. Valyrakis appears to ignore the constitutionally mandated and separate roles of state institutions; appearing as a critic of the judiciary, whose independence is disputed by his specific statement."

Financial News

[19] Gov't, banks reach deal to boost liquidity in local market

The agreement was reached during a meeting between Finance Minister George Papaconstantinou, Regional Development and Competitiveness Minister Mihalis Chryssohoidis and the leadership of the Hellenic Bank Association.

Speaking to reporters after the meeting, the two ministers said the agreement envisaged the signing of a "Liquidity Pact" with banks in order that a new package of state guarantees to the banking sector, worth 25 billion euros, to be distributed through loans in the market. The agreement also envisages that banks will help both citizens and enterprises seeking to participate in a tax amnesty scheme, offering support in the implementation of a new tax law, creating a special card to record electronically all consumers' transactions and taking advantage of existing financial tools and new investment products promoted in cooperation with the European Union.

Within this framework, TEMPME - a special fund designed to support SMEs -- will be replaced by a new fund (ETEAN) which will offer both investment and guarantee services with a budget of at least 2.0 billion euros in the period 2010-2011, with the aim to reach 6.0 billion euros in the next four years.

Vassilis Rapanos, president of the association and Nikos Nanopoulos, vice-president, reassured that banks will help in boosting liquidity, while emphasising that the domestic credit system was healthy and strong.

[20] Papademos: Return to markets in 2011 highly likely

"In the course of next year, we expect a gradual return to positive growth," Papademos said in an interview with Bloomberg news agency, and ruled out any restructuring of Greece's debt.

"Restructuring of the Greek debt is not considered an option. It's not an option for any country of the euro region," he added.

Papademos said that Greece will return to the markets "when the time is right", adding that 2011 is a year he would "expect the conditions to improve substantially and the likelihood of a return to markets would be high".

He described Greece's fiscal adjustment so far as "really impressive", but noted that markets and investors "would like to be more convinced that effective implementation (of the stabilisation program) will continue".

Still, Papademos added, "as the outcome becomes more visible, there will be a visible change in financial markets".

[21] Economic Chamber publishes report on Greek banking sector

The report, presented during a "Banking Money Conference 2010" in Athens, also showed that Greek banks continued developing and improving credit risk management systems, operating risk and market risks based on international expertise and practice. They also further strengthened internal control procedures and adopted modern corporate governance practices.

The report said that financial developments and recession scenarios have brought borrowers closer to overdebtness and created an uncertainty over their future solvency, with Greek households facing growing pressure in meeting their financial obligations. Greek households' debt grew by an average rate of 28 pct in the period 2002-2007, helped by record-low interest rates, intense competition among banks in the retail banking sector and low debt rate. During the last three years, however, this growth rate slowed from 25.7 pct at the end of 2006 to 22.4 pct in 20070 and 12.8 pct in 2008.

The report stressed that since the current financial problem was deeply systemic, initiatives to be taken in the future towards strengthening the system and financial stability and protecting consumers were important and a close cross-country cooperation was necessary.

The report was presented by Dr Gerasimos Sapountzoglou, a professor at the Economic University of Athens and member of Proton Bank's board.

[22] Stricter penalties against tax evasion eyed

The draft bill also drastically reduces tax evasion limits for imposing prison terms on tax evaders.

Under the draft bill, tax evaders could face prison terms for up to 10 years for failing to report tax income of more than 75,000 euros annually, while retail shops, businesses, manufacturing units and warehouses will face a 48-hour closure if found not to have issued more than 10 receipts worth 500 euros.

The new stricter rules were included in a draft bill offering a "tax amnesty" to individuals and enterprises with pending tax cases.

[23] Employment minister holds talks with Internal Affairs Commissioner

On her part, the Commissioner assured the Employment and Social Security ministry's political leadership that the EU is providing 200 million euros for the implementation of the Greek Action Programme on Managing Immigration Flows.

[24] Minister rejects closing of outstanding cases involving building code violations

Birbili expressed opposition to such a likelihood, speaking before a parliamentary committee that has undertaken to study a government-sponsored draft law on "the financing of environmental interventions, the Green Fund and the ratification of forest maps".

The ministry's position on the issue was clarified following a relevant request made by MPs representing all parliamentary political parties.

As regards the Helliniko site where the old Athens airport operated, Birbili said investors will have to follow parameters meeting the government's approval.

[25] Work stoppages in public transport on Wednesday

Hellenic Rail Organisation (OSE), Suburban railway employees have declared a five hour work stoppage from 12:00 -5:00 p.m.

Moreover, there will be no urban buses and trolley services from 11:00 a.m.- 4:00 p.m.

[26] Stocks end 1.59% lower

The composite index of the market fell 1.59 pct to end at 1,472.50 points, off the day's lows. Turnover was an improved 118.133 million euros. National Bank's shares fell 3.15 pct, Cyprus Bank was down 6.53 pct and ATEbank fell 6.19 pct. The Big Cap index dropped 2.43 pct, the Mid Cap index ended 1.39 pct down and the Small Cap index fell 1.67 pct.

The Food (1.55 pct) and Utilities (1.46 pct) sectors scored gains, while Banks (4.18 pct) and Commerce (3.20 pct) suffered the heaviest percentage losses of the day. Broadly, decliners led advancers by 133 to 39 with another 43 issues unchanged.

Edrasi (10 pct), Kri-Kri (9.09 pct) and Space Hellas (8.89 pct) were top gainers, while Elfico (18.87 pct), Logismos (16.98 pct) and Attikat (13.33 pct) were top losers.

Sector indices ended as follows:

Insurance: -3.14%

Industrials: +0.02%

Commercial: -3.20%

Construction: -0.40%

Media: -1.69%

Oil & Gas: +0.21%

Personal & Household: -0.12%

Raw Materials: -0.64%

Travel & Leisure: -0.94%

Technology: -2.27%

Telecoms: -2.03%

Banks: -4.18%

Food & Beverages: +1.55%

Health: -2.32%

Utilities: +1.46%

Chemicals: -0.94%

Financial Services: -3.05%

The stocks with the highest turnover were National Bank, Coca Cola, Bank of Cyprus and Alpha Bank.

Selected shares from the FTSE/ASE-20 index closed in euros as follows:

Alpha Bank: 4.38

ATEbank: 0.91

Public Power Corp (PPC): 11.57

HBC Coca Cola: 19.20

Hellenic Petroleum: 5.82

National Bank of Greece: 7.38

EFG Eurobank Ergasias: 4.15

OPAP: 11.57

OTE: 5.30

Bank of Piraeus: 3.56

Titan: 14.50

[27] Greek bond market closing report

In interbank markets, interest rates were mixed. The 12-month rate rose to 1.42 pct, the six-month rate rose to 1.14 pct, the three-month was 0.88 pct and the one-month rate was 0.62 pct.

[28] ADEX closing report

Volume in futures contracts on equities totaled 11,646 contracts worth 6.866 million euros, with investment interest focusing on National Bank's contracts (5,629), followed by Eurobank (864), OTE (833), Piraeus Bank (450), Alpha Bank (778), Cyprus Bank (381) and ATEbank (247).

[29] Foreign Exchange rates - Wednesday

U.S. dollar 1.356

Pound sterling 0.856

Danish kroner 7.511

Swedish kroner 9.297

Japanese yen 114.13

Swiss franc 1.337

Norwegian kroner 8.030

Canadian dollar 1.400

Australian dollar 1.412

General News

[30] Major archaeological find on Crete

Small gold plaques, 1-3cm-thick, in different forms (square, triangle, and diamond-shaped) were found next to the remains of the woman, discovered a few weeks ago by the team led by archaeology professor Nikolaos Stampolidis. The findings were inside a 2,700-year-old twin tomb, the only one in ancient Eleftherna, located very close to a necropolis of fallen warriors.

A unique jewelry piece depicting a bee as a goddess was also found amongst the thousands of gold plaques.

The findings are so extraordinary that they justify the decision made recently by the Archaeological Institute of America to include the excavations at ancient Eleftherna among the best worldwide.

In the past 27 years, since the excavations were launched, archaeologists have been creating an archaeological park, by recreating an ancient city at the site of Orthi Petra, spanning a 2,000-metre-long and 1,500-metre-wide area.

[31] Retrospective exhibition of paintings by Loukas Venetoulias

The exhibition, titled "Critical Realism", showcases 140 representative works by the artist, from his early works after he graduated from the Athens School of Fine Arts to his death in 1984.

He studied under Yiannis Moralis and Spyros Papaloukas at the Athens School of Fine Arts (1953-58), and in 1971 he was awarded a Ford Foundation grant.

Venetoulias was one of the founding members of the Association of Visual Artists of Northern Greece, and served as vice president of its board of directors.

His works have been exhibited in one-man shows and group shows in Cyprus, the US, Belgium and elsewhere.

Venetoulias also made a name for himself as a set designer and book illustrator.

His better known works include "Via Egnatia", "The Fix Brewery" (1962), "Junk Shop" (1969), "Ajax" (1972), "Dedicated to Mondrian" (1973), "Santorini", "Old Woman and Young Girl", "Building Site", and "Vardaris Square" (1981).

The exhibition will run through October 22.

[32] World renowned filmmaker Theo Angelopoulos honored in Adana film festival

The annual event, hosted by Adana Metropolitan Municipality, took place on Sept. 20-26.

[33] Cargo ship searched for illegal weapons, systems

Based on the inspection conducted, the materials discovered could have both commercial and military use (dual use), defence ministry sources said.

The vessel is allegedly French-owned and originated from Asia.

Syria appears to be the ship's destination, according to its bill of laden documents, although the authenticity of the latter is questionable. Authorities are also examining whether the vessel's cargo is North Korean.

The case is handled by the coast guard.

[34] Thessaloniki man shot by armed robbers

The incident occurred outside a shop at 3:20 p.m. when the four robbers threatened the victim at gunpoint and attempted to remove his bag, which contained an unspecified amount of money. When he resisted the robbers shot him in the leg, grabbed the bag with the money and fled in a private car.

Shortly afterward, they were spotted getting into another car and speeding off in an unknown direction. The victim was rushed to hospital.

[35] Protesting truck owner arrested for attack on foreign driver

The incident was reported as truck owners in Greece continue various protests against now ratified legislation finally liberalising the road freight transport sector in the country.

The 41-year-old, who is accused of obstructing traffic, damaging private property and assault, was identified by the victim as one of the truck owners whose vehicles were parked along the Nea Karvali section of the Egnatia motorway which stretches across the breadth of northern Greece.

The suspect and other four suspects, as yet unidentified, allegedly used private cars at dawn on Monday to block the highway and force the 55-year-old Bulgarian national to stop his truck at the Stavros Amigdaleonas section of the Egnatia motorway.

[36] Arrest on Crete on gun possession charges

Police, acting on a tip-off, found and confiscated, among others, an automatic firearm, a WWII Mauser, 4 pistols, 2 revolvers, 3 shotguns, a flare gun, shotgun spare parts, a sword with a 26cm-long blade and hundreds of cartridges. The arm of a marble statue of unknown origin was also found in his possession.

The suspect is scheduled to appear before a prosecutor on Tuesday.

Weather Forecast

[37] Rainy on Wednesday

[38] The Tuesday edition of Athens' dailies at a glance

ADESMEFTOS TYPOS: "The final measures for closure of outstanding tax obligations".

APOGEVMATINI: "The new retirement ages".

AVGHI: "Education Minister Anna Diamantopoulou: "We are changing the University's DNA".

CHORA: "Surcharge on 2011 circulation fees for all vehicles".

ELEFTHEROS: "Preposterous!! Government copied main opposition New Democracy's (ND) measures for Education".

ELEFTHEROS TYPOS: "Circulation fees set fire to 1.7 million car owners".

ELEFTHEROTYPIA: "Low fees for cars bought before 2005 and higher for the newer".

ESTIA: "How the University has been downrated".

ETHNOS: "Closure in...installments - Government's final decisions".

IMERISSIA: "Closure of outstanding tax obligations in 24 installments and 20 percent down payment".

KATHIMERINI: "According to Labour Minister Louka Katseli circumvention of collective labor agreements is open in enterprises facing problems".

LOGOS: "Government seeking revenues".

NAFTEMPORIKI: "Lower down payment and more installments".

NIKI: "Crucial answers on the illegally enclosed open spaces".

RIZOSPASTIS: "Universities to become 'shops' of monopolies".

TA NEA: "Circulation fees: New 'green' fees in accordance with the emissions".

TO VIMA: "Real estate.... mafia above suspicion".

VRADYNI: "Leviathan State - 2011 State Budget foresees 5 billion euros in additional taxes".

Cyprus Affairs

[39] President: Solution of Cyprus problem a life-long goal

President of the Republic of Cyprus Demetris Christofias has stressed his commitment to do his utmost to find a solution to the Cyprus problem, noting that this has been a life-long goal for him.

President Christofias, who delivered a speech at the Brookings Institute on "Cyprus: Current Developments and Prospects for the Future", talked about the recent developments as regards the Cyprus problem and explained his goal for a bizonal, bicommunal federation that would allow peace, prosperity and security for all citizens of Cyprus, Greek Cypriots, Turkish Cypriots, Armenians, Maronites and Latins.

Referring to the ongoing UN-led Cyprus talks, he said that with former Turkish Cypriot leader Mehmet Ali Talat they achieved progress in the chapter of governance and power-sharing, but added that serious problems have arisen at the talks with current Turkish Cypriot leader Dervis Eroglu on the chapter of properties.

He explained that Eroglu's position on the property chapter is that current users of the properties in the Turkish occupied areas of Cyprus should have the first say as regards the property, while the Greek Cypriot side believes that the legitimate owner of the property must have the first say.

President Christofias said that the property issue is a matter of violation of human rights by Ankara, noting that the Greek Cypriot side's policy is to secure the human rights for all Greek Cypriot refugees, who had to abandon their homes and properties during the Turkish invasion against Cyprus in the summer of 1974.

Analysing the three proposals he had submitted last July on the Cyprus issue, which aim at speeding up the process at the talks, he expressed hope that Ankara will change its initial stance and accept his proposals, saying that this would be to the benefit of Turkish Cypriots and help Turkey's EU accession course.

Ankara, he said, is not ready now for a solution of the Cyprus problem, due to a series of other problems it faces.

"I do not question President Gul's or Premier Erdogan's will for a solution. Maybe they want this to happen at a later stage. But I do not believe that at this stage they are ready", he went on to say.

He said that Cyprus, Greece and Turkey have to collaborate for the resolution of regional problems and the restoration of human rights in the Middle East and Eastern Mediterranean.

The president referred to the Cypriot government's policy as regards Turkish Cypriots, the trade of their goods via the EU Green Line Regulation and expressed the wish that Cyprus is soon reunified.

Replying to questions from the audience as regards Turkey's EU accession course in connection with the Cyprus problem, President Christofias reiterated that Nicosia supports Turkey's EU accession, underlining that this support depends on the fulfillment by Turkey of its obligations towards the EU and Cyprus itself.

The Cypriot president noted that an EU member state cannot maintain occupation forces on the territory of another EU member state.

In this context, he said that the Cyprus problem is not the greatest obstacle in Turkey's EU accession, pointing out that other EU member states favor a privileged relation with Turkey instead of a full accession.

He said that the Turkish leadership will have to separate the Cyprus problem, which is a problem of invasion and occupation, from the other problems it faces at its EU accession course.

Replying to another question as regards the existence of Turkish troops on Cyprus' territory, he expressed the view that Turkey will not withdraw its troops prior to the achievement of a solution, noting, however that if Ankara decides to withdraw even a small part of its troops prior to the solution, this would be a token of good will.

"My position", he said, "is that all foreign troops should be withdrawn from Cyprus", but noted that at a meeting he held with former British Prime Minister Gordon Brown he had explained to him that "this is not the time to raise the issue of the British Bases".

Britain has retained two military bases in Cyprus since the island gained its independence in 1960.

"I am ready for a solution. I was elected to solve the Cyprus problem", he stressed, adding that "this has been a life goal for me".

Asked about the Cypriot government's position as regards direct trade of Turkish Cypriots with the EU, President Christofias stressed that the Republic of Cyprus as a sovereign state has to be respected, adding that direct trade would mean recognition of the self-styled Turkish Cypriot regime in the Turkish occupied areas of Cyprus, adding "I will not allow that to happen".

He recalled his proposal regarding trade from the port of Famagusta under UN auspices, saying that this would improve the economic situation of the Turkish Cypriots.

The Cypriot president also expressed the view that the fact that many Turkish Cypriots have abandoned Cyprus and live in other countries is linked to Turkey's policy to give priority to the needs of the illegal Turkish settlers and not to Turkish Cypriots themselves.

Asked about relations between Cyprus and Israel, he clarified that those relations have always been good, adding that their improvement has no connection with recent problems between Ankara and Tel Aviv.

Reiterating Cyprus' support towards the Palestinian people and the establishment of an independent Palestinian state, he said that relations between Israel and the Arab world have to be restored in order to achieve conditions of peace in the region.

Moreover, he called upon the Arab states to recognize Israel's right of existence in order to have mutual respect.

Later Tuesday, President Christofias was due inaugurate in Washington a unique exhibition on "Cyprus: Crossroads of Civilizations" at the

Smithsonian's National Museum of Natural History, to mark the 50th anniversary of the independence of the Republic of Cyprus.

In July, the Cypriot President announced three proposals on the Cyprus issue. The first provides for linking the discussion on three chapters in the Cyprus problem, those dealing with property, territory and immigration, to facilitate the resolution of the thorny chapter on properties and expedite the dialogue.

The second proposal urges Turkey to apply UN Security Council resolution 550, which calls for the transfer of the fenced off area of Varosha, in Famagusta, to the administration of the United Nations. Part of this proposal is the opening of the port of Famagusta under EU auspices to benefit the Turkish Cypriots.

The third proposal is to convene an international conference when within range of an agreement on the internal aspects of the Cyprus problem.

Cyprus has been divided since 1974 when Turkish troops invaded and occupied its northern third territory. Cyprus UN-led talks are underway between the leaders of the two communities of Cyprus, President Christofias and Turkish Cypriot leader Dervis Eroglu.

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