Athens News Agency: News in English, 06-04-06

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

CONTENTS

[01] Government has four-year plan, Greek FinMin says after talks with Karamanlis

[02] Greek govt seeks to create more free zones

[03] Alogoskoufis: High-profile reforms already generating results

[04] Convicted felon Vavylis arrives in Athens

[01] Government has four-year plan, Greek FinMin says after talks with Karamanlis

Speaking to reporters, after a meeting with Prime Minister Costas Karamanlis, Alogoskoufis said he briefed the PM over a meeting of an inter-ministerial commission to discuss the issue on Wednesday.

The Greek minister stressed that a two-year labour agreement reached between employers and trade unions early in the week paved the way for a similar agreement between workers and the managements of public sector enterprises. Alogoskoufis expressed the hope that a deal would be reached by the end of April to prevent the government from introducing a law on incomes policy in the public sector. Responding to questions whether a 4.0 percent pay increase to workers in public sector companies in 2007 signalled a government intention to hold early elections, the Greek minister underlined that the government has a four-year plan, that the 2005-06 period was crucial in dealing with a huge fiscal deficit and that for the next two years it planned to cut tax factors to support low incomes and pensioners in the country.

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[02] Greek govt seeks to create more free zones

The zones are expected to drastically boost the export activity of Greek enterprises in the manufacturing, commerce and services sectors. "The primary target of a Free Zone is to store, distribute and possibly manufacture mainly non-community products and to facilitate international trade. The best locations to create such zones are ports, industrial zones located near the country's borders or in road and railway axis, while island locations could also be examined," Sioufas said.

The Greek minister stressed that these regions would be equipped with financial and investment incentives and the necessary infrastructure to be able to host financial, business and international activities. Such zones are currently working in the ports of Piraeus, Thessaloniki and Heraclion, Crete.

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[03] Alogoskoufis: High-profile reforms already generating results

Citing what he called criticism on both sides of the reforms' debate, Alogoskoufis first noted that measures taken so far have produced results because "their (measures) rate of implementation was compatible with what bureaucracy, the Greek economy and society in general could stand."

The Karamanlis government's top economic policy-maker served as the closing speaker at the Economist group's 10th "Roundtable with the Government of Greece", held over the past week at a downtown Athens hotel.

Shifting to criticism by the opposition, especially main opposition PASOK, the preceding ruling party, Alogoskoufis said the latter was only attempting to "generate political gains from those feeling they are losing from reforms when the latter succeed."

"Did they (PASOK) want the gap (between Greece and other euro zone countries to continue? Convergence with the European Union is something that our people want," Alogoskoufis said.

In briefing an audience composed mostly of corporate executives, business people and diplomats, Alogoskoufis reeled off a series of changes he said have jumpstarted the Greek economy and ended a "tragically anachronistic development model" employed in the country for roughly two decades, reforms he said include corporate tax breaks, more flexibility in the labour market, proper regulation of the capital market, unification of bank employees' pension funds and an intent to begin substantive talks and dialogue to reform the country's shaky social security system after the current government's tenure ends.

On the closely watched fiscal front, he reiterated a projection of a 4.3-percent budget deficit for 2005, falling to 2.6 percent, and therefore below the EMU-mandated limit of 3 percent, for 2006.

"We had to change, and we changed our anachronistic model of development, one based on high public spending, in favor of one based on entrepreneurship ... the Greek people paid for this mistaken policy, as Greece entered the euro zone unprepared,? he stressed.

Along those lines, he charged that public sector employment between 1993 and 2004 increased by 24 percent alone, "this simply could not continue".

Finally, Alogoskoufis, the economy minister since March 2004, pointed to a series of indicators he emphasised vindicated the Karamanlis government's "mild economic adjustment" policy, namely, an increase in real incomes, rising exports, both in terms of volume and as a percentage of GDP, official joblessness under 10 percent for the first time in years, a hefty rise in corporate profits (39 percent up in 2005 from 2004) as well as convergence in per capita GDP with the EU average.

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[04] Convicted felon Vavylis arrives in Athens

Up until his extradition, Vavylis was being held in a Venetian prison after being arrested in Bologna in April 2005, to serve a seven-year sentence for a drug-smuggling conviction. He was accompanied on the flight to Athens by three Greek police officers who went to Rome to take charge of the felon.

He was due to be taken under police escort to the Attica General Police Headquarters (GADA) on central Alexandras avenue for formal identification procedures, and from there to a prosecutor for arraignment on charges in connection with a drug case for which he had been sentenced to seven years imprisonment by a court in Volos in 1997 and afterwards to an investigator for the other offences he is accused of.

Vavylis, a former aide of ousted former Jerusalem Patriarch Irineos, has been accused of repeated counts of violating state secrets, repeated counts of forgery, fraud, being an accomplice to fraud, repeated counts of embezzling objects of great value entusted to him by the manager of foreign property, being an accomplice to embezzlement, stealing a false certificate, theft, harbouring a criminal, libel, perjury and unprovoked verbal abuse.

The charges concern his activities in Greece, Israel and Italy, while his career includes stints as a police informant, a law enforcement equipment sales rep and even a monk.

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