Athens News Agency: News in English (AM), 98-10-21

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

NEWS IN ENGLISH

Athens, Greece, 21/10/1998 (ANA)

MAIN HEADLINES

• Athens calls for intervention regarding EU funding to Turkey
• Pangalos to visit Moldova, Russia
• BSEC parliamentary committee meeting in Athens
• Turkish warplanes violate Greek airspace
• Three new border corridors on Greek-Albanian border expected
• Time change on Sunday
• Russian-made "OSA-AK" anti-aircraft enters Greek arsenal
• First part of feasibility study on Burgas-Alexandroupolis pipeline
• OTE employees' union strike in protest of further share flotations
• Equities rise
• Bill capital markets ratified
• Greek jewellery market in stagnation
• Titan announces intent to buy shares of Bulgarian cement company
• 'Reverse auction' for state securities
• Gov't, insurance company reps meet
• Weather
• Foreign exchange

NEWS IN DETAIL

Foreign Minister Theodoros Pangalos yesterday sent a letter to his Austrian counterpart and current president of the EU council of ministers, Wolfgang Schuessel, asking him to intervene to prevent the adoption of European Commission proposals for the release of Community funds towards Turkey, which Athens considers to be legally unfounded.

According to diplomatic sources, Mr. Pangalos strongly criticises the Commission's attempt to release funds allocated to Turkey under the fourth financial protocol, which have up to now been blocked by a Greek veto.

Noting that the attempt is contrary to decisions taken at the EU summit in Cardiff, the sources said, Mr. Pangalos warns that if the Commission sticks to its proposals, Greece will be forced to have recourse to the European Court of Justice.

In the letter, the sources added, Mr. Pangalos speaks of "a mistaken approach" on the part of the Commission, which will in the future create many problems.

Government spokesman Dimitris Reppas said last week that any attempt to release EU funds to Turkey "by a different path" would be legally groundless and politically unorthodox.

He was replying to questions on reports that European Foreign Affairs Commissioner Hans van den Broek was considering releasing EU funds to Turkey, presently blocked by Greece, through some different channel.

Despite efforts by its EU partners to persuade Greece to lift its veto, Athens has insisted on adherence to decisions taken at the last EU summits in Luxembourg and Cardiff, when Turkey was told that its EU candidacy would depend on whether it improved its human rights record and relations with Athens.

Pangalos to visit Moldova, Russia

Foreign Minister Theodoros Pangalos begins visits to Moldova and Russia today for talks with the two countries' leaderships.

It will be the first visit by a Greek minister to Moldova since its independence.

During his trip to Moldova today, he will meet with President Petru Lucinschi, Prime Minister Ion Ciubuc, Foreign Minister Nicolae Tabacaru and Parliament President Dumitru Diakov. He will also visit the Greek section at Chisinau University and meet with members of the ethnic Greek community and with Greek businesspeople active in the country.

He heads for Russia tomorrow where he will have talks with Prime Minister Yevgeny Primakov, his counterpart Igor Ivanov and with other government and national assembly (Duma) senior officials.

During his stay, he will sign a protocol of cooperation between the two countries' departments of historical archives and an agreement for the upgrading of the consular authorities in the Greek and Russian capitals.

On the occasion of the 170th anniversary of the establishment of diplomatic relations between the two countries, Mr. Pangalos will inaugurate an exhibition at the Moscow Music Hall dedicated to the life and works of late Greek composer Dimitris Mitropoulos.

BSEC parliamentary committee meeting in Athens

The 12th meeting of the Black Sea Economic Cooperation pact (BSEC) legal and political affairs parliamentary committee began in Athens yesterday.

At issue is the "formulation of a legal framework for the double taxation between member-states".

The parliaments of Armenia, Azerbaijan, Bulgaria, Moldova, Romania, Russia, Turkey, the Ukraine and Greece are represented.

Turkish warplanes violate Greek airspace

Turkish warplanes violated Greek airspace and infringed on Athens FIR regulations on 13 instances yesterday.

According to reports, 20 Turkish F-16 and six F-4 fighters flew two to seven nautical miles off the coasts of Psara, Hios, Agios Efstratios, Symi and Karpathos.

All Turkish aircraft were armed, reports stated.

The Hellenic Air Force intercepted the Turkish planes in all instances, while in six interceptions led to engagements.

In a related development, a Turkish fighter flew near a Hellenic Air Force C-130 within the Athens-Paphos air corridor during a scheduled flight. The transport plane at the time was within the Nicosia FIR.

Three new border corridors on Greek-Albanian border expected

An agreement concluded between Albania and Greece for the opening of three new border corridors was ratified by a majority vote by the relevant Parliamentary committee yesterday.

Deputy Foreign Minister Yiannos Kranidiotis said that the opening of the two corridors was a request by ethnic Greeks in the region, while only the corridor at Sayiades was a request by Tirana.

Mr. Kranidiotis said that work required to open the corridors will be completed in 2001 and will be funded by European Union programmes.

Referring to the military agreement signed between Albania and Turkey, Mr. Kranidiotis said that the agreement concerns technical aid for rebuilding the port of Vlore, adding that it has not been ratified by the Albanian Parliament.

Time change on Sunday

In line with other European Union countries daylight saving time in Greece ends on Sunday. Consequently, at 4 a.m. on Sunday clocks must be set one hour back to show 3 a.m.

Russian-made "OSA-AK" anti-aircraft enters Greek arsenal

The Russian-made "OSA-AK" anti-aircraft and anti-missile system was officially incorporated in the Greek army yesterday.

At ceremony attended by of National Defence Undersecretary Dimitris Apostolakis and the army's top leadership at an artillery unit in Komotini, northern Greece, Mr. Apostolakis said:

"The system joining the defence mechanism is part of the ministry's overall pursuit of strengthening the country's anti-aircraft defence".

He said that the order for the OSA-AK system was placed in April 1998 and was incorporated in the armed forces in a short period of time. He added that decisions for the procurement of new weaponry systems are taken swiftly to benefit the economy and strengthen Greece's defence.

The OSA-AK system is composed of a search radar, an administration vehicle, four missile launchers, two missile loaders and assistance vehicles.

Sixteen such anti-aircraft and anti-missile systems were officially incorporated in the land-based army on Monday.

An OSA-AK unit has existed in Komotini since 1992, being of east German origin, and has conducted successful firing tests.

Mr. Apostolakis said new procurements include multiple rocket launcher systems (MLRS), missiles, 12 new self-propelled 155 mm guns from the US in the early months of 1999, 50 slightly used 155 mm guns from Germany in 1998, 12 new self-propelled guns of the Zuzana type from Slovakia, two anti- artillery radars from the US in March 1999, a number of battlefield surveillance systems and various other armaments programmes such as the development and joint production of hi-tech ammunition.

First part of feasibility study on Burgas-Alexandroupolis pipeline

The first phase of a feasibility study for the oft-proposed oil pipeline from the Bulgarian port of Burgas to Alexandroupolis will have been completed by February 1999, an announcement by the DEP-Thraki SA consortium stated yesterday.

The consortium, formed by Hellenic Pertoleum, the Latsis group and the Kopelouzos group, has come to an agreement with the ILF and Brown & Root firms for the study.

OTE employees' union strike in protest of further share flotations

The administrative board of the federation of Hellenic Telecommunications Organisation (OTE) employees yesterday said its members would strike on Oct. 26-27 and 29-30.

According to federation representatives, the action is in support of demands to stop the further sale of OTE shares as well as for financial assistance for employees' pension fund.

After October, the representatives said, the fund would be unable to pay pensions to beneficiaries.

The federation is also demanding a new salary scale and system for determining employees' remuneration. National economy ministry sources said last week that the government was expected within days to give the go-ahead for a third OTE float as part of its privatisation plan.

The float is to sell around 10 percent of share capital, which would bring the amount privatised to 35 percent of stock.

Under the original sale plan, 70 percent of stock would be sold to investors in Europe and the United States through book building, and 30 percent in Greece through book building and a public offer.

Equities rise

Greek equities resumed their upward trend to end higher yesterday led by strong buying interest in Leasing stocks and other small and medium-sized listed companies.

The general index ended 1.15 percent up to 2,051.19 points with turnover at 34.6 billion drachmas.

Sector indices scored gains. Banks rose 1.15 percent, Insurance ended 0.48 percent up, Investment jumped 2.46 percent, Leasing soared 8.0 percent, Industrials were 1.0 percent higher, Construction increased 2.57 percent, Miscellaneous ended 1.23 percent higher and Holding rose 1.31 percent.

The parallel market index for small cap companies ended 1.67 percent up.

Bill capital markets ratified

Parliament has passed a new bill on capital markets signalling the start of a new era for the Athens Stock Exchange.

The new bill calls for a satisfactory assets structure as the only precondition for companies seeking entry on the Athens bourse.

Analysts expect a wave of foreign multinational companies operating in Greece, Greek shipping firms and other companies with great growth potential to seek listing on the market.

Panafon, the country's largest mobile telephone operator, and Interamerican, one of the biggest insurance firms in Greece, are expected to lead the way to ASE.

ASE's board has already approved 10 new listings including Lambrakis Press Organisation, Druckfarben Hellas, Infoguest, Despek Hellas, Pantechniki, Karamolegos and Kyriakidis Marbles-Granites.

Other candidates, including International Insurance, Keterin, Sigma Stockbrokers, Tegopoulos, Active Invest and Mevaco, have submitted entry applications. According to ASE's figures, in the year 1990 the total value of public offerings and capital increases in the Athens Stock Exchange was 190 billion drachmas. That figure fell to 142 billion in 1991 and to 40 bln in 1992.

A year later, the total reached 101 billion drachmas. In 1994 new capital totalled 258 billion drachmas and next year it fell to 83 bln.

The figure soared to 841 billion in 1996. New capital totalled 586 billion drachmas in the first seven months of 1998.

Greek jewellery market in stagnation

The Greek jewellery market's decade of stagnation was due to the lack of infrastructure in the sector, lack of competitiveness and low production, industry representatives told a news conference in Thessaloniki yesterday.

They attributed their problems to domestic economic hardship, a crisis in the small and medium-sized enterprises' sector and the government's policy towards the industry.

The news conference was held ahead of a jewellery trade fair, "Kosmima '98", beginning in Thessaloniki Friday.

Stavros Zaharelis, vice-president of the Greek Jewellers' Union, said that domestic gold demand fell to 13.2 tonnes in 1996 from 15.5 tonnes in 1995 but was expected to return to 15.5 tonnes in 1997 due to domestic speculative buying.

Greek jewellery production shrank 50 percent in the period 1986-96 compared to European production, halving its European share from 4.0 to 2.0 percent.

The country's global share in gold and silver jewellery production fell to 0.5 percent from 1.0 percent.

Greece's two major competitors, Italy and Turkey, doubled their production in the same period.

Greek jewellery exports remained stagnant in the same period, while imports increase by 30-35 percent annually.

Almost 7,500 jewellery shops and 2,200 workshops operate in Greece, employing 40,000 people. Annual turnover, although yet to be recorded, exceeds 100 billion drachmas.

A total of 397 exhibitors from Greece and foreign countries will participate in the trade fair.

Titan announces intent to buy shares of Bulgarian cement company

The Titan cement company has informed the Athens Stock Exchange of its intention to buy-out shares of the Bulgarian cement company Plevenski.

The Greece-based Titan, already possessing 48.75 per cent of the Bulgarian cement company and participating in the privatisation process proclaimed by the Bulgarian government, submitted a bid for the purchase of shares representing 34 per cent of all of Plevenski's shares.

Draft agreements were also signed with the Bulgarian company's employees and pensioners for the sale to Titan on their behalf of the shares they are entitled to receive from the Bulgarian state, and which amount to 5-6 per cent of the total figure.

'Reverse auction' for state securities

A reverse auction for state securities of a seven-year duration and a fluctuating interest rate was held yesterday in a series of 1997 and 1995 issues. Bids amounting to 194.9 billion drachmas were submitted for all issues, while bids for 80 billion drach mas were accepted (equalling the amount being auctioned).

The highest prices acceptable for the bonds were 98.40 for the Sept. 30 1997 issue (the total amount accepted was 27 billion drachmas), 98.75 for the January 28 1997 issue (33 billion drachmas) and 100.83 for the Dec. 27 1995 issue (20 billion drachmas) .

Gov't, insurance company reps meet

A number of proposals submitted by private insurance companies to the government were the focus of a meeting last night between Development Undersecretaty Mihalis Chrysohoidis with insurance company representatives.

According to sources, companies would not object to freezing premiums in 1999, as part of the government's anti-inflation policy, however, this would have to be in return of certain other proposals, which the development ministry sees favourably.

Specifically, some of these include changes to the way car insurance damages are paid, namely, that a driver's own insurance pays for an accident instead of the driver responsible for the accident; an increase in the tax deductible of life insurance premiums and accelerated procedures to link transport ministry and insurance company computer systems.

WEATHER

FOREIGN EXCHANGE

(C.E.)

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