Athens News Agency: Daily News Bulletin in English, 10-11-11

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

CONTENTS

[01] FinMin meets Fitch officials, Katseli

[02] Former ECB vice president on economic crisis

[03] No dismissals in public sector and of permanent staff in utilities, minister says

[04] ND: new tough measures after the Nov. 14 elections

[05] Support for candidates in the second round of the local government elections

[06] BoG recommends measures to cut public debt, rejects talk of debt restructuring

[07] Greek fiscal deficit down 30 pct in Jan-Oct

[08] EBEA presents proposals to help in the recovery of the Greek economy

[09] Gov't could cut pharmaceutical spending by 1.5 billion euros in 2011

[10] Deputy Culture Minister Nikitiadis in London

[11] New era for sea cruise in Greece

[12] Session on 'How global economic crisis is changing the Greek economy'

[13] European Commission on red tuna fish

[14] Sifounakis says tender for improving Thessaloniki sea front in two months

[15] ESEE representatives meet with deputy minister of finance

[16] ADEDY warns with worker mobilizations

[17] AB Vasilopoulos reports 5.0 pct rise in Q3 sales

[18] Building activity down 25.2 pct in Jan-Aug

[19] Stocks end 2.0 pct down

[20] Greek bond market closing report

[21] ADEX closing report

[22] Foreign Exchange rates - Thursday

[23] Asopos River region characterized as vulnerable zone by joint ministerial decision

[24] Hytiris greets INSI debate on the safety of journalists

[25] Exhibition of maps of Aegean Sea from 15th-17th century

[26] Athens-Patras highway section to close until Thursday morning

[27] EMCDDA unveils 2010 Annual Report on the drug problem in Europe

[28] Psychiatrist arrested on child porn charges

[29] Foreign national arrested for drug offences in central Athens

[30] Prisoner escaped since 2008 caught in Imathia

[31] Cloudy on Thursday

[32] The Wednesday edition of Athens' dailies at a glance

[33] FM issues press release on European Commission's report on Turkey

[34] Fuele: Imperative need for Turkey to implement the Customs Union Protocol Politics

[01] FinMin meets Fitch officials, Katseli

The meeting took place at the request of the rating agency, whose experts will also be meeting with the independent Hellenic Statistical Authority (ELSTAT) to discuss growth data and other macroeconomic indicators, and with officials of the General State Accounts Office and the Public Debt Management Agency on the course of execution of the budget and the country's borrowing status.

Similar meetings will be held with a team of Moody's experts expected in Athens by the end of the year.

Fitch's is currently the only ratings firm that has maintained Greek sovereign bonds at a BBB- rating, whereas Moody's and Standard & Poor's have downgraded Greek bonds to junk status.

Finance Ministry officials say that there has been an improvement abroad regarding the Greek economy, which increases prospects of upgrading its macroeconomic prospects, although not before mid-2011.

Papaconstantinou met later on Wednesday with labour and social security minister Louka Katseli, his last in a series of consultations with government ministers before the drafting of the ministries' budgets and the 2011 general state budget.

In statements after the meeting, Katseli suggested that spending cuts of up to 1.5 billion euros might be achieved through the cooperation of the various ministries involved.

The new budget is due to be tabled in parliament on November 18, and will take into account an upward revision of the country's deficit for the period 2006-2009 expected to be released by Eurostat on November 15, the day that a team of European Commission, European Central Bank (ECB) and International Monetary Fund (IMF) 'troika' inspectors will arrive in Athens to draft their regular report ahead of approval of the third tranche of the EU-IMF support loan to Greece.

The government has said that the main emphasis in the 2011 budget will be to cut back state spending without further cuts to wages and pensions or increases in taxation above those already agreed on.

[02] Former ECB vice president on economic crisis

Papademos added that there must be no illusions of painless solutions for imbalances and the ineffectiveness of decades to be reversed that led to the present economic situation, stressing that the government has taken so far difficult and politically bold decisions.

He reiterated many times that if a substantive and permanent fiscal restructuring is not achieved, monetary stability will not be achieved and the country will be unable to exit from the crisis.

Referring to the issue of the restructuring of the country's debt, he said that it is neither a desirable nor a necessary solution for the country as well as the eurozone. Papademos further said that the socially fair distribution of the cost of fiscal adjustment is necessary for social tensions to be avoided that will make the implementation of the goals that will lead to the exit from the crisis difficult.

[03] No dismissals in public sector and of permanent staff in utilities, minister says

He further said that the middle class will not be burdened by the 2011 budget and added that "of course the services of the state must become more effective, as regards the receiving of revenues and of course the measures that the government must face can only be measures that will not undermine the growth momentum that we must always pursue in order to exit from the recession. They must not restrict liquidity in the market, which is necessary for the economy to move and they must not harm those forces that are at their limits, concerning the tackling of the problems of their day-to-day life."

[04] ND: new tough measures after the Nov. 14 elections

ND spokesman Panos Panagiotopoulos stressed that "the citizens have realized that the policy followed by the prime minister leads to destruction and that was the reason they called for a change of course through their vote."

He expressed certainty that the anti-memorandum vote will be "dominant in next Sunday's elections as well because, apparently, the government has not received the message sent by the electorate".

[05] Support for candidates in the second round of the local government elections

Mantouvalos, who did not garner enough votes to be eligible to run in next Sunday's second round of local government elections, expressed support to ND-backed candidate Vassilis Michaloliakos who will run against ruling PASOK-backed Yiannis Michas for the municipality of Piraeus.

Mantouvalos also expressed support to the ND-backed candidate for Attiki Regional Governor Vassilis Kikilias who will face PASOK-backed candidate Yiannis Sgouros.

Meanwhile, the opposition Coalition of the Left (SYN) Political Secretariat decided by a majority vote to urge its supporters to "decide on their stance in the second round of the local government elections at will", adding that "this stance meets the needs of society and reflects the party's political strategy."

However, this stance was rejected by the party's leftist wing which was in favour of voting down all candidates supported by the two major political parties, ruling PASOK and main opposition New Democracy (ND).

Financial News

[06] BoG recommends measures to cut public debt, rejects talk of debt restructuring

The central bank, taking in mind an anticipated upward revision of the country's fiscal deficit and public debt data, estimates that a fiscal adjustment program should be accelerated, presenting a larger decline of primary deficits and achieving higher primary surpluses earlier, accelerating a privatization program (beginning with the restructuring of Hellenic Railways) and improving management of the state's real estate property, in an effort to take structural development measures to speed up economic recovery and creating preconditions for satisfactory and sustainable GDP growth rates.

The central bank reiterated its position that any restructuring of the country's debt would be hazardous to the Greek economy and noted that this could be avoided by implementing the necessary policy mixture. History shows that in the past any developed country which achieved zero or negative primary result did not declare bankruptcy but continued fiscal adjustment efforts. This is the clear commitment of the Greek government. In any case, the Bank of Greece's management believes that the political and economic cost of a bankruptcy would be much larger than any short-term cost related with a strategy of fiscal consolidation.

A bankruptcy combined with a restructuring of debt would have direct and significant negative consequences not only for the assets of foreign investors but for Greek banks, Greek pension funds and Greek private investors holding a significant part of the public debt, along with foreign pension funds and EU banks, also holders of a significant part of Greek public debt.

[07] Greek fiscal deficit down 30 pct in Jan-Oct

This development mainly reflected a large recovery in VAT revenues, as a result of higher VAT rates and efforts to combat tax-evasion, while a negative impact on revenues had lower receipts from other taxes. However, the ministry expects tax revenues to rise in the last two months of 2010.

The fiscal deficit fell to 17.405 billion euros in the 10-month period, down from 24.833 billion euros in 2009, for a decline of around 30 pct down from a 32 pct target envisaged by an updated economic policy program. The annual target for the year envisages a decline of 36.9 pct.

Regular budget spending were down 7.0 pct in the January-October period, with primary spending down 11 pct -surpassing an annual target of a 9.2 pct decline, while interest payments rose by 5.5 pct, down from an annual target of a 7.2 pct rise.

Spending by a Public Investment Program were down 24.6 pct, while revenues were down 3.3 pct compared with 2009.

[08] EBEA presents proposals to help in the recovery of the Greek economy

Speaking to reporters, Mihalos said the need for accepting these 10 proposals was more significant now ahead of a revision of the country's fiscal deficit and public debt. Mihalos said a revision of the country's statistics to the worse has been discounted, while he noted that Greece offered huge counter-incentives to attracting new enterprises. A recent survey by EBEA showed that almost nine out of 10 enterprises thought that the current tax policy was burdening their financial performance, while more than eight in 10 faced a decline in turnover, two in 10 were examining plans to relocate in foreign countries and one in two was examining the termination of their operations if financial performance did not improve within next year.

EBEA's proposals included: cutting tax levels for enterprises, cutbacks of state spending but not of the Public Investment Program and the implementation of a Fourth Community Support Framework program. Other proposals include an immediate promotion of specific development projects and policies, such as development of a fiber optic network, development of a state real estate property in Hellinikon, exploiting regional airports and ports, building theme parks and sports facilities, etc. Action was also needed towards a radical reform of the public sector, deregulating closed markets and professions and creating terms of equal competition between state and private sector enterprises, along with a restructuring of all loss-making public sector enterprises and actions to deal with liquidity problems in the domestic market.

[09] Gov't could cut pharmaceutical spending by 1.5 billion euros in 2011

The meeting with the Labour minister completed a round of meetings between the Finance minister and his colleagues in cabinet ministries in the framework of drafting ministry budgets and the state budget for 2011. The government will focus on cutting state spending to achieve its goal for lower fiscal deficits

[10] Deputy Culture Minister Nikitiadis in London

On the same day, Nikitiadis had separate meetings with three of the biggest tourist organisations, that take tourists from Britain to Greece, the leadership of the TUI, the president and associates of the administration of Thomas Cook, as well as the heads of Olympic Holidays.

He then met with the vice president of the Ryanair airline company and the representatives of the administration of Easyjet and of Monarch airlines, as well as with representatives of the companies Trip Advisor and Expedia.

Moreover, placing emphasis on the alternative forms of tourism, Nikitiadis provided a working luncheon for the representatives of the biggest British special tourism offices (Sunvil, Planet Holidays, Responsible Travel, CV Travel, Ramblers, Ionian&Aegean Holidays), discussing with them possibilities of developing their tourist products.

[11] New era for sea cruise in Greece

"Today is the beginning of a new day for the sea cruise [sector] and for the country. This decision offers incentives to sea cruise companies to operate more in Greek ports, offers incentives to hire Greek sailors, offers incentives for the development of our ports. According to information, this decision was met with enthusiasm by sea cruise companies and I believe a new era for sea cruises begins from 2011", Diamantidis said.

[12] Session on 'How global economic crisis is changing the Greek economy'

Among the main speakers was Deputy Finance Minister Filippos Sahinidis who said in his address that "the Greek problem is also of a productive model. Greece did not wish to determine what its role is in the global distribution of labour."

Sahinidis also referred to the markets, stressing that "since 2001 the markets did not evaluate risks correctly. They allowed countries to borrow cheaply. I remind you that during the drachma era as soon as the deficit emerged at 7-8 percent the markets profiteered. Then, the governments took immediate measures."

The event was attended by senior banking officials and a large number of businessmen.

[13] European Commission on red tuna fish

The European Commission, following a proposal by Greek Commissioner Maria Damanaki, adopted on Tuesday, during its session, a proposal on red tuna fish that will be tabled at the next session of the International Committee on the preservation of the tuna of the Atlantic ICCAT, that will be held in Paris in a few days.

At this session, the parties in ICCAT will be called on to agree on a plan on regaining red tuna fish reserves for the 2011-2013 period.

Referring to the issue, Damanaki said among other things that "it is a step of progress of major importance. For the first time we have a clear proposal by the Commission for the Council to decide the decrease of the total fishing quotas of red tuna fish allowed, based on scientific factors."

[14] Sifounakis says tender for improving Thessaloniki sea front in two months

Sifounakis was speaking with the members of Thessaloniki's Agency for the Regulatory Plan and Protection of the Environment.

[15] ESEE representatives meet with deputy minister of finance

They focused, among others, on VAT payments, the issuing of receipts, and adoption of rewards for law abiding taxpayers.

[16] ADEDY warns with worker mobilizations

ADEDY accused the government of "implementing an anti-labour and anti-popular policy which is being escalated to extremes" through "threats of layoffs in the public sector and the lack of a clear denial on behalf of the government, which cannot ignore that such a move will be a blunt and direct violation of the Constitution." The statement also referred to "the layoffs of contract workers, the first victims of the Memorandum," and to "the unprecedented, in the post WWII period, reduction of incomes and upsets of social insurance rights."

ADEDY underlined that "the workers united and in massive numbers will respond immediately with mobilizations within the next 15 days" and called on the government "to clarify its position and intentions in a direct and categorical manner. In a different case, it (the government) will be responsible for the mass production of similar scenarios and will be judged by salary earners, pensions, the young and the jobless and each and every citizen."

[17] AB Vasilopoulos reports 5.0 pct rise in Q3 sales

In a report by Delhaize Group -the owner of the super market chain- said AB Vasilopoulos continued gaining significant market share despite adverse economic conditions prevailing in the country. Private label sales accounted for 17 pct of total sales. Operating earnings margin fell to 2.3 pct of sales in the third quarter of 2010, from 3.6 pct last year, reflecting additional promotion actions, higher payroll cost and higher taxation. Operating earnings fell 31.8 pct to 9.0 million euros, from 13 million euros last year.

[18] Building activity down 25.2 pct in Jan-Aug

Hellenic Statistical Authority on Wednesday said building activity in the private sector totaled 2,697 building permits, down 5.2 pct from August 2009, while it was down 24.8 pct in volume over the same period. Eastern Macedonia-Thrace (-48 pct), Epirus (-41.5 pct), Attica (-39.6 pct), Western Greece (-38.8 pct), Crete (-35.5 pct), Central Greece (-35.2 pct) and Western Macedonia (-30.3 pct) suffered the heaviest percentage losses in building volume among the country's regions, while only three regions scored gains in building volume, Southern Aegean (16 pct), Thessaly (11.7 pct) and the Peloponese (8.4 pct).

Private building activity fell 10.2 pct in building permits in the eight-month period, and by 25.2 pct in volume, compared with the same period in 2009. All regions suffered declines in building volume, with Attica (-35.9 pct), Central Greece (-33.5 pct), Western Greece (-25.4 pct) and Central Macedonia (-23.7 pct) recording the heaviest percentage losses.

[19] Stocks end 2.0 pct down

Coca-Cola Hellenic was the only blue chip share to end higher, while OPAP (4.83 pct), ATEbank (4.76 pct), Piraeus Bank (4.23 pct) and National Bank (3.73 pct) suffered the heaviest percentage losses.

The Health (7.47 pct) and Food (1.02 pct) sectors scored gains, while Media (4.51 pct), Travel (4.25 pct) and Banks (3.40 pct) suffered losses. Broadly, decliners led advancers by 95 to 62 with another 42 issues unchanged. Euroline (17.81 pct), Altec (16.67 pct), Paperpack (13.11 pct) were top gainers, while Alsinco (19.4 pct), Druckfarben (16.07 pct) and Tegopoulos (9.09 pct) were top losers.

Sector indices ended as follows:

Insurance: -1.51%

Industrials: -0.46%

Commercial: +0.34%

Construction: -0.88%

Media: -4.51%

Oil & Gas: -1.78%

Personal & Household: +0.03%

Raw Materials: -2.13%

Travel & Leisure: -4.25%

Technology: -1.22%

Telecoms: -2.60%

Banks: -3.40%

Food & Beverages: +1.02%

Health: +7.47%

Utilities: -2.00%

Chemicals: -0.63%

Financial Services: -2.89%

The stocks with the highest turnover were National Bank, OPAP, Alpha Bank and OTE.

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

Alpha Bank: 4.52

ATEbank: 0.80

Public Power Corp (PPC): 12.22

HBC Coca Cola: 19.70

Hellenic Petroleum: 5.49

National Bank of Greece: 7.49

EFG Eurobank Ergasias: 4.37

OPAP: 12.61

OTE: 6.00

Bank of Piraeus: 3.17

Titan: 15.50

[20] Greek bond market closing report

[21] ADEX closing report

Volume in futures contracts on equities totaled 13,388 contracts worth 8.143 million euros, with investment interest focusing on National Bank's contracts (6,885), followed by Eurobank (979), OTE (466), Piraeus Bank (2,053), Alpha Bank (1,083), Marfin Popular Bank (296), Cyprus Bank (274) and ATEbank (201).

[22] Foreign Exchange rates - Thursday

U.S. dollar 1.388

Pound sterling 0.863

Danish kroner 7.513

Swedish kroner 9.371

Japanese yen 114.39

Swiss franc 1.350

Norwegian kroner 8.140

Canadian dollar 1.394

Australian dollar 1.387

General News

[23] Asopos River region characterized as vulnerable zone by joint ministerial decision

The new decision supplements an earlier one (Decision No. 19652/1906/1999) to protect more effectively the aquatic environment at the Asopos River drainage basin. The region is characterized as vulnerable to pollution by nitrates due to agricultural activities.

The studies conducted by Athens water company EYDAP to ensure that the region's population will be supplied with clean tap water will be completed by the end of the year, while tenders will be issued for the necessary projects, a statement by the ministry of environment, energy and climate change underlined on Wednesday.

The ministry is also considering the establishment of a special inspectors' office at Oinofyta, the site of an informal industrial zone in the greater Asopos River region.

Asopos River is a small but significant water course some 60 km north of Athens.

[24] Hytiris greets INSI debate on the safety of journalists

Underlining the importance of the journalist being identified with society, Hytiris pointed out "the journalists have only one asset, their signatures; namely, their credibility."

He added that "democracy and culture identify with free information and dialogue. The journalists should feel and be free."

INSI director Rodney Pinder stressed that "the institute's mission is to help journalists survive to tell the stories, we all have to listen."

[25] Exhibition of maps of Aegean Sea from 15th-17th century

The exhibition is titled "The Aegean Sea - Cartography and History 15th-17th century", and the exhibits are from the Greek Cartography Archives collection.

The Greek Cartography Archive was founded in 2002 with a donation by Victor and Niovi Mela of their old maps collection to the National Bank of Greece's Cultural Foundation.

The exhibition, at the Eynardou Mansion on the corner of 20 Agiou Constantinou and Menandrou streets off Omonia Square, will run through May 29, 2011.

A second exhibition will follow covering the period from the late 17th century to the early 19th century.

The Eynardou Mansion houses the National Bank's Cultural Foundation.

[26] Athens-Patras highway section to close until Thursday morning

Trucks heading from Athens to Patras will be diverted onto the old national road until Kiato and private cars will be directed onto a four-kilometre detour. Vehicles travelling from Patras to Athens will be diverted onto the old national road.

[27] EMCDDA unveils 2010 Annual Report on the drug problem in Europe

The EU agency's figures concern the year 2008 and show that cannabis remains the most popular substance, considering that 22.5 pct of the population in Greece has tried it.

Roughly 14 million Europeans have used cocaine in their lifetime, 3 millions under the age of 34. The rising use of cocaine is evident in Greece as well based on the fact that the number of people requesting help to deal with cocaine addiction has tripled in recent years.

As regards heroin, it is the most widely used controlled substance in Greece. A serious problem for Europe is the continuous appearance of new synthetic drugs, while very alarming is the fact that these substances are sold over the internet.

Referring to the housing problem faced by the state-run drug rehabilitation agency OKANA, Health Minister Andreas Loverdos stated that the best possible solution is being sought, focusing on moving the agency's services to hospital areas.

[28] Psychiatrist arrested on child porn charges

Police said that the detainee's trail was traced through an investigation on the internet, and a spot investigation was made at his office in downtown Thessaloniki on Tuesday, where police confiscated the psychiatrist's PC, which contained files with child porn videos.

At a subsequent search of the man's house, police found and confiscated a second PC hard drive, which was currently being examined by police experts.

The psychiatrist, who was detained at the Thessaloniki security police headquarters and was being interrogated, was also a collaborator at a local state hospital in a substance detox program, apart from his private practice.

[29] Foreign national arrested for drug offences in central Athens

Authorities also searched two apartments from where the 37-year-old said he had obtained the drugs. In the first apartment they found 89 grammes cannabis in total, packaged in 16 matchboxes, and 11 grammes of opium divided into eight packages, as well as a 20cm flick knife and a 9cm blade.

In the second apartment they found 4,133 kilos of cannabis divided into 44 bars, 216.2 grammes of heroin in plastic packages, 459 grammes of opium divided into three packages, 1.573 kilos of unprocessed cannabis, another quantity of unprocessed cannabis weighing 138 grammes divided into 25 matchboxes, 1,035 euros and dozens of drivers licences and passports from various countries.

[30] Prisoner escaped since 2008 caught in Imathia

The convict was a 35-year-old Albanian national that had escaped from the Larissa prisons, where he was serving a lengthy sentence for drug-related and other offences. The prison had given him a brief furlough and he had failed to reappear at the appointed time, using it as an opportunity to escape. At the time he was recaptured he was driving a stolen car with fake number plates.

Weather Forecast

[31] Cloudy on Thursday

[32] The Wednesday edition of Athens' dailies at a glance

ADESMEFTOS TYPOS: "More austerity measures to come".

AVGHI: "Third round of measures with lay-offs and cutbacks".

AVRIANI: "4.5 billion euros black hole in deficit brings new snap elections scenarios".

ELEFTHEROS: "Ministers and PASOK cadres pull the carpet from under Papandreou's feet".

ELEFTHEROTYPIA: "Troika threatens salaries in private sector".

ESTIA: "Tragic decisions for the economy".

ETHNOS: "Prime Minister George Papandreou's rage over his ministers' and cadres' wrong handlings".

ELEFTHEROS TYPOS: "The defeat in elections brings in-party clashes, and the day after the elections additional measures".

IMERISSIA: "Deficit off target".

KATHIMERINI: "The measures divide the government".

LOGOS: "In the vise of the troika and rating firms".

NAFTEMPORIKI: "National Bank of Greece and Eurobank offer 8.7 billion euros liquidity to market".

TA NEA: "Government 'sees' unholy alliances between ND and Communist Party in the second round of local government elections".

RIZOSPASTIS: "Government is lying that it will not harm salary and pension earners".

TO VIMA: "Nagging in ruling PASOK and main opposition New Democracy over the local government elections result".

VRADYNI: "Troika wants more blood".

Cyprus Affairs

[33] FM issues press release on European Commission's report on Turkey

The Ministry of Foreign Affairs of the Republic of Cyprus deems as satisfactory the 'objective ascertainment' of the European Commission that Turkey has not yet fulfilled its obligations towards Cyprus.

It also considers as positive the Commission's reference that Turkey is expected to actively support the ongoing UN-led Cyprus talks aiming at reaching a just, functional and viable solution of the Cyprus problem, in line with the relevant UN Security Council resolutions and the EU principles.

In a press release issued Wednesday on the European Commission's progress report and its Strategy Paper on the Enlargement, the Foreign Ministry of Cyprus deems as objective and of great importance the opinion of the Commission that Turkey's substantive and in concrete terms commitment towards a functional solution of the Cyprus problem is of crucial importance.

However, the Foreign Ministry expresses its objection towards the Commission's claim that Turkey continues to publicly express its support towards the Cyprus talks.

The Foreign Ministry stresses that Turkey's stance towards the ongoing Cyprus negotiations is contrary to its EU obligations for a substantive support of the efforts to reach a solution in Cyprus based on the relevant UN resolutions and the EU principles.

It also points out that "what is of importance is not the Turkish public declarations but the substance of the statements of the Turkish officials, which, until today, contravene the agreed basis for a solution of the Cyprus problem''.

The FM says that the Commission's report states that "however, despite repeated calls by the Council and the Commission, Turkey still has not complied with its obligations as outlined in the declaration of the European Community and its Member States of 21 September 2005 and in the Council conclusions, including the December 2006 and December 2009 conclusions".

"This ascertainment is objective and reflects the fact of the non-compliance of Turkey with its EU obligations and its obligations towards its member statesÖ" the press release says.

The Foreign Ministry points out that Turkey's obligations as outlined in the Declaration of the 21st of September 2005, include the recognition of all EU member states by Turkey, as well as the implementation of the Ankara Protocol, the normalization of Turkey's relations with all EU member states and the support on behalf of Turkey of the efforts to solve the Cyprus problem.

The Foreign Ministry notes that for one more consecutive year, the Commission's report points out that Turkey does not meet its obligation of the full, non-discriminatory implementation of the Additional Protocol to the Association Agreement and has not removed all obstacles to the free movement of goods, including restrictions on direct transport links with the Republic of Cyprus.

In addition, the FM notes that the Commission refers to the fact that Turkey has made no progress as regards the normalization of its bilateral relations with the Republic of Cyprus.

In its press release, the Foreign Ministry notes that the Commission refers to Turkey's stance to continue to veto Cyprus' membership of several international organisations, including the OECD and the Wassenaar Arrangement on export controls for conventional arms exports and dual-use goods.

Moreover, it also notes that in its progress report, the Commission says that the government of the Republic of Cyprus reported violations of its territorial waters and airspace by Turkey.

The Foreign Ministry considers as positive the fact that the Commission will continue to monitor closely and specifically report on all issues covered by the 21 September 2005 declaration, in accordance with the Council conclusions of December 2006.

It also points out the proposal of the Commission, that due to the lack of progress on behalf of Turkey, the EU continues to block the eight EU-Turkey negotiating chapters it had frozen in December 2006, a measure that will have a permanent impact on the overall progress of Turkey's EU course.

Moreover, the Foreign Ministry considers as inappropriate the Commission's comment that there has been an increase in the number of applications before the so called "compensation commission" for Greek Cypriot properties in the Turkish occupied areas.

The Ministry notes that the issue of properties is extremely complicated and points out that given in mind that the interpretation of the European Court of Human Right's decisions does not fall within the competences of the European Commission, the Commission's comment was unfortunate.

The government of the Republic of Cyprus will proceed to a thorough study and evaluation of the content of the two papers and will express its opinion on all matters to the Council of the EU, the FM says.

The FM's press release concludes that the Council of Ministers and the European Council will make their conclusions next December as regards the progress of Turkey's accession negotiations.

[34] Fuele: Imperative need for Turkey to implement the Customs Union Protocol

It is an imperative need for Turkey to implement the Customs Union Protocol without any discrimination, European Commissioner for the Enlargement Stefan Fuele has noted, speaking on Tuesday evening before the Committee on Foreign Affairs of the European Parliament.

Presenting the annual reports produced to assess progress in European Union membership candidate and potential candidate countries, and replying to a question, Fuele said that the rhythm of the EU accession negotiations is not satisfactory. Fuele called on Turkey to "implement the Customs Union Protocol without any discrimination, in order the momentum of the negotiations not to be lost".

Fuele did not give any kind of guarantee that new EU-Turkey negotiation chapters will be opened. However, he noted that every kind of progress will accelerate the process.

Finally, he reassured that the European Commission fully supports the ongoing direct negotiation process between the leaders of the two communities in Cyprus, aimed at finding a solution in the Cyprus problem.

36, TSOCHA ST. ATHENS 115 21 GREECE * TEL: 64.00.560-63 * FAX: 64.00.581-2 INTERNET ADDRESS: http://www.ana.gr * e-mail: anabul@ana gr * GENERAL DIRECTOR: ILIAS MATSIKAS

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