Cyprus Mail: News Articles in English, 99-01-10

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From: The Cyprus Mail at <http://www.cynews.com/>

January 10, 1999

CONTENTS

[01] S-300s used as election ploy, admits government

[02] Man suspected of cleaver attack on son's wife

[03] Church one step closer to electing new Limassol bishop

[04] Cyprus pitches in for Mitch victims

[05] Attempt to set up bicommunal think-tank

[06] US House staffers on four-day visit

[07] Cyprus and the euro, pluses and problems

[01] S-300s used as election ploy, admits government

S-300 fall-out continued to rain down on the local political scene yesterday, with the government admitting - for the first time - that it had used the missile issue as a pre-election ploy.

President Clerides' political opponents have consistently charged him with promising to bring the Russian ground-to-air missiles solely in order to win re-election in February 1998.

Such attacks have intensified since Clerides's controversial decision last month to send the missiles to Crete rather than bring them to Cyprus.

In the run-up to the February polls, Clerides's main opponent, George Iacovou, also promised he would bring the S-300s. He said he would do so sooner than Clerides would.

Yesterday, government spokesman Christos Stylianides admitted the government had, along with opposition parties, been guilty of "exaggeration and unnecessary publicity on defence matters" during the run-up to last year's elections.

"We should all ask ourselves whether such discussions helped our foreign policy," Stylianides said in an interview with CyBC radio.

The announcement of the S-300 order, signed in January 1997, got the government into hot water. Turkey threatened to attack the missiles if they were deployed in Cyprus. This prompted the United States, United Nations and European Union to pile pressure on Cyprus to cancel the deal, fearing arrival of the missiles could dangerously increase tensions on the island.

Stylianides was asked by the CyBC if his comments applied to Clerides. "I am under the impression that an admission on the part of the government spokesman implies a lot," he answered.

The spokesman's comments came after two deputies on the House defence committee made 'revelations' about military matters earlier this week, despite a gentlemen's agreement between all parties banning public statements on defence issues.

Disy deputy Antonis Karas said Greece had recently sent to Cyprus military hardware "worth maybe hundreds of millions of pounds". Akel deputy Doros Christodoulides then divulged that Cyprus was spending £80 million a year on Greek-made armaments.

Neither deputy's claims were officially denied or confirmed.

Tomorrow, the UN is to begin the process of testing whether the diversion of the S-300s can achieve what numerous visits by foreign envoys have failed to do over the past 18 months - re-start the stalled settlement process.

The UN's permanent representative to Cyprus, Dame Anne Hercus, will resume her shuttle talks between Clerides and Turkish Cypriot leader Rauf Denktash with a morning meeting with the president.

Hercus, who last month called a temporary halt to her shuttle to take a holiday, has, even before the missile decision was announced, expressed optimism about the progress of the talks.

January 10, 1999

[02] Man suspected of cleaver attack on son's wife

Nicosia District Court heard that Ioannis Xifitis had admitted making the attack but had told police the victim, Anna Xifiti, 41, had repeatedly tried to poison him in the past.

The attack took place at around 1pm on Friday at a butcher's shop in Tseri village, outside Nicosia, owned by Andreas Xifitis, the suspects's son and Anna's husband. Andreas was in the shop at the time of the attack, the court heard.

Anna was rushed to a private clinic in Nicosia where she received emergency treatment for a serious head wound. She needed twenty stitches for a cut on the head and also suffered a fractured skull, the court heard. Doctors yesterday said the victim was making a steady recovery and should be ready to leave the clinic today or tomorrow.

Police did not learn of the attack until about 4pm on Friday when they were contacted by doctors at the clinic. Ioannis Xifitis was arrested in his home village of Palechori, some 25 km from Tseri, late on Friday.

The court remanded Ioannis Xifitis in police custody for eight days on suspicion of attempted murder.

The court agreed to a request from the suspect's lawyer that his client be placed under medical supervision while in custody.

The motive for the attack was unclear, police said yesterday.

January 10, 1999

[03] Church one step closer to electing new Limassol bishop

AFTER WEEKS of campaigning dominated by sordid sex allegations, stage one in the long process to elect a replacement for the disgraced Bishop of Limassol was completed yesterday.

Candidacies were submitted for the election of 50 special electors who will themselves eventually vote for the new bishop from among five hopefuls.

The Church elections have been marred by Bishop Chrysostomos of Paphos alleging that the spiritual mentor of one of the bishop candidates is a pervert.

Abbot Athanasios of Macheras monastery is considered the front-runner among the five candidates for bishop. But his candidacy has been weakened by Bishop Chrysostomos's allegations that his mentor - 70-year-old elder Iosif of the Mount Athos monastery of Vatopedhi - molested nuns and young girls during his stay in Paphos 17 years ago.

Vatopedhi has threatened to sue Chrysostomos for libel but the outspoken Bishop has been vindicated by the Cyprus Church's Holy Synod - which has ruled that his lurid allegations are based on fact.

Chrysostomos has consistently denied claims that the sole aim of his allegations has been to scupper abbot Athanasios's candidacy.

The Paphos Bishop is thought to favour the candidacy of Archimandrite Tsiakkas, of Trooditissa Monastery.

The other would-be bishops are Father Varnavas of Stavrovouni monastery, Father Vassilios of the Trimithounda diocese, and Archimandrite Apseros of Agros monastery.

The former Bishop of Limassol, Chrysanthos, was suspended from his duties in November after police launched an investigation into his alleged involvement in more than 30 financial scams in Cyprus and abroad.

January 10, 1999

[04] Cyprus pitches in for Mitch victims

CARRIE Hutton was elated at the response yesterday of Cypriots who gave food, cooking pots, building materials and crop seed to Cyprus CARE (Central American Relief Effort) for Honduran victims of Hurricane Mitch.

With a mere 24 hours of prior media publicity - and a permit from Nicosia Mayor Lellos Demetriades - the response was "better than expected" at the group's truck parked in Eleftheria Square.

"Probably 200 people, maybe more, came by" with donations ranging from "single bags of rice to huge bags of plates or saucepans - you name it," Hutton said. "We've had medicines, food, everything. It's been phenomenal," she said beside the truck donated by Orbit Moving &amp; Storage Ltd of Nicosia.

"People are coming up and saying 'I didn't know you were here.' So I need to contact the mayor's office again, so I can come back next Saturday and do it all again," Hutton said.

Two large Cyprus pharmaceutical companies - Remedica Ltd and Medochemie, both of Limassol - are now packing some $70,000 worth of medicines they are donating to her Honduran relief effort for shipment next week.

The two firms have also pledged to monitor their inventories year-round to draw down additional medicine donations for Honduras, something Hutton termed "bloody marvelous!"

Orbit, which has stuck by Hutton as main donation drop-point, chief packing house and trucker, is handling the shipment of the medicines, along with the packing of the donations gathered yesterday.

The grass-roots group has already shipped a container full of clothing to Honduras, and does not need any more clothing donations.

Hutton, who is spending all her time in the Honduran relief effort these days - at Christmas she was made redundant by a local offshore company - said she is getting a bit concerned about her March rent.

Recently returned from Honduras and Britain, Hutton, a Briton who has lived in Cyprus for six years, is looking for a new job. "I can't even think of that for the moment," she said, "but if I don't start work on the first of March, I'm up the proverbial creek."

Meanwhile, she said, "I'm just watching here as more bags of stuff are being loaded on to the truck. It's just not stopping. There's somebody that came all the way from Aridippou (outside Larnaca).

"They're coming from out of town to bring stuff as well. So, as long as we get permission from the mayor," she pledged, "we're going to be back here next weekend."

At least 15,000 people were killed, tens of thousands more were missing and millions were left homeless when perhaps the century's worst storm tore through Central America in early November. Honduras and Nicaragua were the worst-hit countries. Their economies and infrastructures were literally washed away.

A massive international relief effort is still under way to help the tens of millions of people, in the half-dozen countries and handful of Caribbean islands hit by the storm, recover from what some say was a 20-year economic setback.

Those wishing to help can contact Hutton in Nicosia on 02-776218 or 09- 417213.

January 10, 1999

[05] Attempt to set up bicommunal think-tank

In an interview with the Cyprus News Agency (CNA) released yesterday, Marco Turk said 31 Greek and Turkish Cypriots "from all walks of life" met in Oslo, Norway, last month as part of an on-going bicommunal effort.

Turkish Cypriot leader Rauf Denktash last year imposed a ban on bicommunal contacts on the island.

But Turk said he was determined to create a bicommunal think tank and "to open up the group and continue work on the issues under discussion".

The Fulbright scholar said participants in the Oslo meeting had selected six topics for consideration: the bicommunal movement, structured government, security, human rights, and economic and social issues.

He said the meeting had achieved progress towards narrowing the gap between the two sides.

"Though strong feelings were expressed there was no acrimony and common courtesy prevailed," Turk said.

"The participants went through a process of trust, truth, forgiveness and reconciliation. They took the past into consideration in terms of historical necessity and they look to the future and how to achieve peace."

Turk's think-tank initiative is backed by the US-Norway Fulbright Foundation for Educational Exchange and the Oslo International Peace Research Institute, with the backing of the Norwegian foreign Ministry.

January 10, 1999

[06] US House staffers on four-day visit

The reasons for the visit or meetings, the identities of the US representatives for whom the staffers work, and the congressional committees of possible Cyprus-related interest on which their bosses sit were not announced.

The delegation will meet Foreign Minister Yiannakis Cassoulides, House President Spyros Kyprianou, and George Vassiliou, former Cyprus president and currently the chief negotiator for Cyprus' accession to the European Union.

January 10, 1999

[07] Cyprus and the euro, pluses and problems

EU candidate Cyprus watched from afar as 11 of the 15 European Union members partied on January 1 to mark the birth of the euro. At least four years away from its eagerly-sought EU membership, Cyprus could only give the arrival of the euro a warm round of applause and switch the pound's peg from the now-defunct European Currency Unit to the euro.

"The link of the Cyprus pound with the euro is a natural development since our pound was linked to the ecu, its predecessor," said the Central Bank's Research Department Director Takis Kanaris. The flotation margins of the pound-euro link will range from -2.25 per cent to +2.25 per cent, he added.

"We do not expect substantive repercussions on the Cypriot economy (from the introduction of the euro) - our pound is stable."

Economists, however, said that the launch of the euro will have a great deal to do with the island's EU accession course as membership prospects draw closer. The island, they said, will also benefit from the fact that the single currency includes some of Cyprus' closest European tourism rivals. Countries such as Portugal and Spain would no longer be able to devalue their national currencies at will, as in the past, with the effect that they became cheap destinations, luring tourists from Cyprus.

"A senior government economist told The Sunday Mail that the effect of the euro on the economy of Cyprus would mostly be indirect. "But the government must start preparing to join the EMU (European Monetary Union) from now," he said.

The euro was expected to grow in strength in the short and medium terms, he said. That, in turn, meant that the island's major trading partners in Europe would enjoy good economic health and be able to continue buying Cyprus' products.

More than 50 per cent of the island's total imports come from EU countries, while nearly 40 per cent of its exports go to EU states. Significantly, Britain, which has chosen not to join the single currency for the time being, is the island's main European trading partner and the source of nearly half of the two million-plus tourists who visit the island every year.

"We believe that sterling will more or less follow the fate of the euro and sooner or later it will be led down the same path," said the Central Bank's Kanaris. Now that sterling is outside the euro, it is expected to have more fluctuations against the Cyprus pound, according to Marios Clerides, Hellenic Bank's chief economist.

The prospect of more swings in the Cyprus pound-sterling exchange rate is crucial to the island's trade and tourism. The Cyprus pound appreciated dramatically against sterling after the former became linked to the ecu in 1992. And the rise in the value of the Cyprus pound kept large numbers of British tourists away from the island.

At that time, and for some months, the Cyprus pound hit highs of up to 1.40 sterling, making Cyprus an extremely expensive destination for British holidaymakers, according to Popular Bank's chief economist Yiannos Tirkides.

The Cyprus pound is now hovering around 1.20 to the pound sterling, a rate said by Tirkides to be close to what he sees as an ideal range of 1.22 to 1.23 sterling.

The launch of the euro, according to Clerides and Tirkides, is also likely to pose a problem for Cyprus as it prepares to join EMU through meeting the Maastricht convergence criteria. One criterion stipulates membership of the Exchange Rate Mechanism of the European Monetary System for at least two years prior to EMU membership. During that period the currency must show stability, while no devaluations are allowed against the currency of any EU member state.

For Cyprus, ERM membership means that the pound will have to be freely quoted on international markets, exposing it to attacks by currency speculators. Such a prospect, given the small size of the economy and foreign currency reserves, would certainly trigger a devaluation. "People like George Soros will have a field day in Cyprus," said Clerides.

"Cyprus will not be able to fend off speculative attacks against the pound for more than one day," said Clerides. "It is for this reason that Cyprus must seek the safety of the euro upon membership." "The EU may have to come up with a currency stability test for Cyprus other than the ERM," suggested Tirkides.

Top government officials in Cyprus have said that January 1, 2003, was the target date for EU membership and that the island was hoping for simultaneous EMU membership. Present economic indicators show that Cyprus meets only one of the five main Maastricht criteria for joining EMU, and that is low inflation. Its fiscal and public debt deficits are already in breach of the two criteria setting a ceiling of three per cent and 60 per cent of GDP respectively.

A package of tax hikes designed to narrow the deficits is not now expected to go to Parliament before April. And Cyprus has yet to liberalise interest rates to meet the relevant criterion.

"But at least Cyprus has the privilege of spending the next one or two years watching how the single currency evolves before it charts its own policies to join," said the government economist. "There is a great deal of hope surrounding the euro, but its launch is not totally risk-free."

© Copyright Cyprus Mail 1998

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