From: tzarros@ccs.carleton.ca (Theodore Zarros) Subject: News (in ENGLISH)- Wed, 13 Jul 1994 (Greek Press Office BBS, Ottawa). Athens News Agency Bulletin, PM predicts rise in GDP, industrial output, private investment ------------------------------------------------------------ Athens, 13/7/1994 (ANA): Prime Minister Andreas Papandreou yesterday predicted for 1994 an increase in GDP ranging from one to 1.5% compared to the absence of any increase in recent years, adding that there would be a 1.6% increase in industrial production compared to a continuous decrease since 1990. Speaking before Parliament in a debate on the Greek economy's problems and prospects, Mr. Papandreou said the average rate of inflation would fall by about three percentage units from 1993, while private investments were expected to increase by 5.3% on average. "As a result of the favourable climate prevailing in the economy," Mr. Papandreou said, "about three billion dollars have already returned to the country." "Capital is coming back," Mr. Papandreou said. Mr. Papandreou based his optimism on the start of inflow of funds under the Delors II package, the opening of the country's northern borders and its economic extension, and on the results already produced by the government's economic policy following hard efforts lasting six months. He conceded that the government's hard effort is not enough and also requires support from the other political forces. The Greek economy, he said, will certainly experience difficult moments and what is required is realism and resolve on behalf of the government and the other political forces. Without such support it will simply not succeed, he said. Expressing optimism, Mr. Papandreou said two major events will pave the way for the economy. Firstly, the transfer of capital from the European Union to Greece (under the Delors II package). He said inflow of funds will start as of August 1, and Greece rested many justified hopes on the second Community support framework. The second factor allowing for optimism, he said, is the opening of the country's northern borders and a simultaneous economic extension reaching as far as Russia. The third factor, he added, is economic policy success and an improvement in important economic indicators. The Greek economy has already achieved a fundamental change in the past two months, namely the complete deregulation of capital which if left for July 1, as planned by the previous government, would have found the country in the midst of a huge economic crisis at present. Referring to the struggle to keep the drachma afloat, Mr. Papandreou said had speculators not been kept at bay the majority of the Greek people would have been poorer today. Mr. Papandreou said the exchange crisis led to an increase in interest rates but expressed optimism that a decrease would follow. Commenting on problems facing the economy, Mr. Papandreou said the most important is the fiscal problem which is currently shaped by the increase in public deficits by six percentage units during the period the New Democracy party ruled Greece (1990-1993). Mr. Papandreou further expressed optimism that a rapid increase will be achieved in exports to Balkan and other countries. He ruled out the possibility of new economic measures being taken, calling on all to contribute to an end to "alarmism' and "measure speculation" which ultimately serve speculators. Supporting the economy with words is not enough when action undermines it, he added. Referring to incomes policy, Mr. Papandreou said the government honours its commitments on protecting the actual incomes of the working classes and improving them within the limits of the economy's endurance. On the question of selling shares of the Hellenic Telecommunications Organisation (OTE) and certain subsidiaries of the Public Petroleum Corporation (DEP), Mr. Papandreou said the essence is not who the owner will be, but whether or not the corporations will have a yield, adding that responsibility for taking strategic decisions will not be transferred to private investors. The government's economic policy, he said, is based on "stabilisation, growth and social protection". Mr. Papandreou said safeguarding Greece's smooth passage from the 20th to the 21st century is a challenge for the government and that securing the country's economic superiority in the wider region is another challenge. Concluding his speech, Mr. Papandreou told Parliament there was no other course to follow. Evert: Deep crisis, social upheaval ahead ----------------------------------------- Athens, 13/7/1994 (ANA): Main opposition New Democracy party leader Miltiades Evert referred to "the deep crisis" of the Greek economy, which, he claimed, was at the doorstep of bankruptcy. The people, he said, have lost faith and hope and, apart from an economic stalemate, there will be social upheaval a year from now. The main culprit, said Mr Evert, was the bankrupt public sector, which dragged the whole economy with it. Public debt would approach 32 trillion dr. at the end of the year (or 70% of GDP), from 26 trillion in 1993. The government, he said, was in a state of paralysis and could not be blamed for an erroneous policy, because it simply had no policy. He offered pessimistic forecasts, predicting 12% inflation at the end of the year and an additional fiscal deficit of 700 to 800 billion dr. He said the government's convergence programme was based on erroneous assumptions of low interest and inflation rates, and should be described instead as a programme of divergence. New Democracy's proposals for dealing with the economic crisis revolved around three axes: First, a new institutional basis for decision-making and policy implementation involving upgrading of "participating democracy", regional decision-making and a drastic freeing of society from the institutional fetters of the state. Secondly, a new model of economic development, involving the redefinition of the relations between state, economy and society, with clear delineation of each side's role. Third, greater integration into Europe and strengthening of the international position. A basic prerequisite for an exit from the crisis was a fiscal shock, involving a 5% reduction in expenditure in the first year, and 2% every year thereafter. Finally, Mr Evert said that development policy required a 12% annual increase in private investment and 10% in public investment at constant prices. This could be achieved through boosting the capital market, the speeding up of privatisations of public enterprises, and the activation of funds available through the Second Delors Package. Political Spring blames both parties ------------------------------------ Athens, 13/7/1994 (ANA): Political Spring party leader Antonis Samaras claimed the policies of both major parties had failed and called for an aggressive policy on the sliding drachma, aimed at improving competitiveness and increasing production, with a parallel control of prices. Greece needed at least a 4% annual growth rate in order to achieve convergence with the European Union, he claimed. Communist Party Secretary-General Aleka Paparriga criticised all other parties for "trying to convince the working people, the majority of Greeks, that there was room for dealing with the problems of the crisis to their benefit in the long run, without changing radically the basis of policies applied in the last 50 years". Papoulias confers with Boutros-Ghali, meeting "had a rich content" ----------------------------------------------------------------- United Nations, 13/7/1994 (ANA/M.Georgiadou): Foreign Minister Karolos Papoulias stated after his 45-minute meeting with UN Secretary-General Boutros Boutros-Ghali that their discussion "had a rich content. We touched upon important issues, such as FYROM, Bosnia, Cyprus, our relations with Albania and the rights of the ethnic Greek minority". Mr Papoulias said he had briefed Dr Ghali on the progress of talks with FYROM issue co-ordinator Cyrus Vance and touched upon all aspects. Discussions with Mr Vance, he added, aimed at overcoming sensitive points, but there were no direct talks with Skopje at the moment. Asked whether or not Dr Ghali had asked for lifting the Greek trade embargo against FYROM, Mr Papoulias replied negatively. Regarding Cyprus, he said, "I think our position is well known... the entire effort for Confidence Building Measures failed due to the stand adopted by Mr Denktash, but what is more, Ankara did not assist in the overcoming such difficulties all this time. We continue to believe that Cyprus is an issue of invasion and occupation. I don't think anyone could have expected President Clerides to display any more goodwill than he has done since March." Venizelos: Hope for unanimous agreement on Delors successor ----------------------------------------------------------- Athens, 13/7/1994 (ANA): Government spokesman Evangelos Venizelos told reporters yesterday that he has not ruled out unanimous agreement among EU 12 member-states on a successor to European Commission President Jacques Delors. Mr. Delors' term expires at the end of the year. Mr. Venizelos said "no one can rule out agreement on some person" for the post, but he did not specify who the successor might be. The EU failed to name a successor to Mr Delors, who has held the post for 10 years, at last month's EU summit in Corfu, after the U.K. cast a lone veto against front-runner Belgian Premier Jean Luc Dehaene. "Intense impetus" Greek economy feature-report -------------------------------------------------- Brussels, 13/7/1994 (ANA/G.Daratos-V.Demiris): A report by the Economic and Social Committee's economic, fiscal and monetary affairs department said "the Greek economy is characterised by intense impetus, adjusts easily to sharp changes and has achieved considerable progress in improving important economic indicators". The report, dated June 30, 1994, focuses on "the development of the Greek economy" and contains an analysis of the economic and monetary situation in Greece. It establishes that despite the Greek economy's encouraging prospects "a long way has yet to be covered until permanent internal stability is achieved, criteria for convergence with the Economic and Monetary Union (EMU) are fulfilled, economic and social cohesion with the European Union is attained and, consequently, what is of importance is that the policy of restructuring applied over some years should be continued with determination and without respite." Referring to criteria for accession to the Economic and Monetary Union, the report underlines that "the Greek government has yet to achieve a huge task for criteria set to be fulfilled in time and the convergence programme should be strictly observed". According to the report, necessary preconditions for convergence criteria to be achieved are "exercising a reserved expenditure policy by a numerically limited public administration wherever possible, exercising moderation on the development of incomes both in the public and private sectors and increasing competitiveness among enterprises." On the question of tax evasion and "parallel economy", the report stresses that "tax evasion and paraeconomy (black economy) should not be acceptable phenomena or treated with tolerance in either member-states contributing more to the Community Budget than they receive, or in others receiving more from the Community than what they contribute (such as Greece)." Pangalos discusses OA debt with EU C'ner ---------------------------------------- Brussels, 13/7/1994 (ANA/G.Daratos): Transport Minister Theodoros Pangalos yesterday met with Commissioner Marcelino Oreja who handles the Olympic Airways debt file. Mr Pangalos said later, "the climate is difficult and I can't see how it could not be difficult with so many and such debts." "The issue stood some chance of being discussed in the last session of the European Commission on July 27, before the summer recess," he added. Mr Pangalos also discussed the issue with Greek Commissioner Ioannis Palaiokrasas at an earlier meeting. Two more blasts in Rhodes, "aimed at Greek tourism" by "centres outside Greece" ----------------------------------------------------------------- Athens, 13/7/1994 (ANA): Two more bomb blasts yesterday injured six tourists on the island of Rhodes, only a day after a bomb explosion injured a Greek and an Italian on this fashionable eastern Mediterranean sea resort. Public Order Minister Stelios Papathemelis said that the target of the bomb explosions was Greek tourism adding that he believed foreign agents were at work. Prime Minister Andreas Papandreou, who was briefed by Mr. Papathemelis, said the explosions were a round of incidents Greece had not seen before. Yesterday's blasts, at short intervals, rocked the island's main city, also called Rhodes. Two Greek residents of Rhodes and four foreign tourists were slightly injured in the blasts. The four foreign tourists were identified (phonetic spellings of names) as Danes Hester Yessen, 21 and Tania Laffsen, 18, and Swedes Tommy Evans, 29, and Elen Garouz, 40. All six were discharged from hospital after receiving treatment. The first bomb went off at 15:15 local time outside the night-club "ELLI" in the district of Mandraki near the town of Rhodes, and another, forty minutes later, outside the "Grand Hotel" in the town centre. The two bombs had been placed 300 metres apart in municipality rubbish bins, as was the case with Monday's blast in Lindos. According to the police, they had been set to detonate at a time when the surrounding areas were usually crowded. A blast in the resort town of Lindos on Monday seriously wounded a Greek tourist and slightly injured an Italian tourist. Reactions --------- Athens, 13/7/1994 (ANA): Prime Minister Andreas Papandreou said that the explosions were a "round of incidents we have not seen in our country before". Speaking to reporters after a briefing by Public Order Minister Stelios Papathemelis, Mr. Papandreou said: "I want to emphasise that Greece is a country in which the phenomenon of terrorism is extremely limited". Before briefing Mr. Papandreou, Mr. Papathemelis told reporters such acts were instigated by "centres outside Greece". He declined to name such centres although, he said, he possessed "concrete evidence". "The authorities firmly believe that (the bomb explosions) are provocations coming from centres outside Greece which I cannot name at this moment," Mr. Papathemelis said. Main opposition New Democracy party leader Miltiades Evert condemned the bomb explosions saying they "originate abroad and aim at harming tourism". Political Spring party leader Antonis Samaras advised "cool-headedness and intensification of efforts for the arrest of the saboteurs of Greek tourism". Coalition of the Left and Progress (Synaspismos) leader Nikos Constantopoulos said the explosions "smell of criminal plans against the nation's interests." Monday's explosion ------------------ Athens, 13/7/1994 (ANA): Referring to Monday's explosion, Mr. Papathemelis told ANA earlier that investigations were continuing "in every direction", stressing it was certain that the blasts were aimed at harming Greek tourism. "The target of the attack was to harm tourism," Mr. Papathemelis said. He said that according to police investigations so far, "it (the attack) is not connected with any Greek (terrorist) organisations and the way they operate." Two persons, Paraskevas Mantanis, 35, a Greek and Favio Larotenda, 27, an Italian were injured in the blast. The Greek was flown to Athens for surgery and the Italian was being treated in a Rhodes hospital for light injuries. The explosive device, which an anti-terrorist squad said was apparently made of a stick of dynamite and a slow-burning fuse --since it left no traces -- "a method which is not used by any terrorist organisation in Greece". It was placed in a rubbish bin near a restaurant outside the city of Lindos. So far no one has claimed responsibility for the explosion, but, according to the prefect of Dodecannese, Yiannis Paraskevas, an unknown caller telephoned a newspaper in London and warned that a bomb will explode near the beach in Lindos at 5.50 p.m. local time, but the device went off only a few minutes before 1600 local time. He gave no further details. Government spokesman Evangelos Venizelos described Monday's explosion as an "isolated event, uncommon for a country like Greece which is known for its tranquillity and safety." All calm in Rhodes following bomb explosions -------------------------------------------- Athens, 13/7/1994 (ANA): Reports from Rhodes last night said calm was prevailing following yesterday's bomb explosions that injured four tourists and two Greeks. Tourists on the island are continuing their holidays without problems and no cancellations of hotel reservations have been reported. The Ministries of Public Order and Tourism, the Prefecture of Dodecannese and the Union of Rhodes Hotels have combined forces to inform large tour operators in Europe on the exact extent of damage caused by bombs in Rhodes. According to an announcement yesterday, the island's regional authorities have taken the required measures needed to handle the situation.