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Cyprus Mail: News Articles in English, 00-12-01
Friday, December 1, 2000
CONTENTS
[01] Christmas debt warning from Consumers' Association
[02] News Briefs
[03] Bank stocks slaughtered
[04] Parliament calls for ban on all bonemeal feed
[05] Finance Ministry has second thoughts about third child cash handout
[06] Don't get too excited about the rain
[07] Government says report shows improved image
[08] Plenty of time for Denktash to change his mind, says De Soto
[09] Cyprus FTSE index launched
[10] Teachers call off action to give talks a chance
[01] Christmas debt warning from Consumers' Association
THE CONSUMERS' Association is warning people to resist offers by banks to
increase their spending power through increased credit limits, unless they
are confident they can afford the repayment. Laiki Bank has written to many
of its customers, giving them up to an additional 50 per cent on their
credit card limits, without asking them beforehand if they wanted the extra
purchasing power. In addition, they are offering incentives for people to
spend more by entering anyone who spends more than £500 between mid
November and mid January into a draw for a new car. "People must assess
their needs and their financial situation. They should remember that what
they spend now must be repaid later," advised Petros Markou, the President
of the Consumers' Association. "No bank will give an individual anything
for free and the public should not be taken in by such an offer, unless
they are confident they can afford to clear the credit card bill when it
arrives in the New Year - otherwise, because the interest rate is so high,
it makes the whole borrowing process very expensive." Maria Demetriou from
Nicosia, a single parent with two children, said she was outraged when she
realised Laiki had raised her credit limit by £250 without her prior
permission. "I think it's very cheeky of them - the money would be useful
but it would only result in me getting into more debt. I've never even
asked for a credit card and was sent one by the bank automatically, and
it's already overflowing." She said she had never been in debt before, but
the initial offer of the card was "too tempting to resist." Lefteris
Vassiliou, the Manager of the Dhekelia branch of Laiki, admitted that the
bank was offering incentives to those customers who spent above normal
during the Christmas period, but he was adamant additional limits to credit
cards had only been raised on those accounts that had been managed well.
"Yes, we have written to our clients who do not have arrears on payments to
clear or reduce their credit card bill. If, for example, someone has a
limit of £250, we can raise that amount to £300, or if it's £2,000 we make
it £2,500. But if someone has defaulted just once on a repayment we have
not made this offer." Markou did not blame the banks for encouraging their
clients to spend more in the run up to Christmas, but he believes anyone
concerned they may not be able to afford the additional cost should be
cautious. "At the end of the day, we at the Consumers' Association cannot
take away people's free choice, but I can't stress enough the risks of
getting into debt at this time of year." He added that new variable
interest rates, which come into effect in the New Year, would probably
result in borrowing becoming more costly. "I would not like to see people
being drawn in by special offers only to find in two months time they have
spent way beyond their limit." His advice comes at the same time as
Britain's Office of Fair Trading warned people "not to become another debt
statistic." It has just launched a new campaign, which highlights the
dangers of overspending during the festive period. Figures reveal consumer
credit in Britain has increased by more than 60 per cent in the last four
years and is now running at £156 billion a year.
[02] News Briefs
Turkish spy released
CONVICTED Turkish spy Sarih Chichekli was yesterday deported after serving
just over four of his six-and-a-half year sentence. Chichekli, who in 1997
admitted to spying on the National Guard for the Turks, was taken to
Larnaca airport under heavy police guard at around 2pm and put on a flight
to Athens. He was then set to fly to Turkey. Attorney General Alecos
Markides said last night that the spy had served all of a sentence, which
was reduced along with those of many other convicts after President
Clerides was re-elected in February 1998. The Turk was arrested in the
Limassol area on March 8, 1997, after video recordings and diagrams of
National Guard movements were allegedly found in his possession.
Chichekli's release and deportation had not been publicised by the
authorities but the television cameras were nonetheless waiting for him as
he arrived at the airport yesterday.
Woman killed on roads
A 60-year-old woman was killed after being hit by a bus and in Nicosia
yesterday, the fifth road victim in the space of two days. According to
police, Panayiota Dimioti, from Dimes in the Limassol area, was hit as she
tried to cross Democratia Avenue in Ayios Dhometios yesterday afternoon.
Panayiota, who lived in an old peoples' home, died before she could be
taken to hospital. The recent spate of road deaths, four of which have
involved pedestrians being run over, has been blamed on the bad weather.
[03] Bank stocks slaughtered
BANK OF Cyprus (BoC) slid below the £4 mark yesterday and Laiki dropped
under £3 as the season of goodwill continued to bypass the CSE. The all-
share index lost another seven points in a single session, closing 3.04 per
cent down at 225.9 points and heading towards the end of one of the worst
weeks in its short history. Across the board losses ranged from 0.44 per
cent in the technology sector to 4.56 per cent in the banking sector as the
big sell-off continued up at the IMC - only the proprietor has changed.
Only 26 companies registered gains yesterday compared to the 129 that
headed downhill and the 51 who managed to escape the blitz. Volume was only
£13.4 million. Although the index opened six points lower than Wednesday's
233-point close it managed to drag itself up to 229 by mid-session but
sighs of relief were short lived as it headed south for the remainder of
the session. BoC shed another 21 cents to close at £3.93, a 5.07 per cent
drop on a volume of £2.8 million. In Athens, although the general and
banking indexes were up slightly, BoC fell again to 2,500 drachmas (£4.16),
a loss of 2.72 per cent. BoC's run of bad luck both here and in Athens
could not be swayed by the bank's new announcement yesterday that it had
obtained a licence to operate in Australia, details of which are due to be
announced today. Laiki did not fare as badly on the CSE yesterday as its
rival, but still managed to lose 14 cents, ending at £2.94. As usual BoC,
Laiki and GlobalSoft accounted for over half the days; volume but at least
Global was heading in the opposite direction, adding four cents to finish
at £5.12. The CSE analyst said yesterday that this time last year when the
index began its endless downward descent, brokers, media commentators,
experts, and politicians, reassured investors that the sell-off was due to
the need for cash for Christmas shopping and that it is normal for a stock
exchange that had risen so fast to retreat slightly. "Well, one year has
passed and investors are still liquidating for cash. By now they must have
gathered enough cash to Christmas-shop for the rest of their lives because
between then and now, quite a few billion pounds have left the CSE," he
said. "If that is the case then consumer-spending will go through the roof
this Christmas."
[04] Parliament calls for ban on all bonemeal feed
THE HOUSE Agricultural Committee yesterday called for an immediate ban on
the feeding of meat and bonemeal (MBM) to all animals, including pigs and
poultry, in the wake of growing fears over the spread of BSE in Europe. The
feeding of MBM to cows has been blamed for spreading the disease in Europe.
Its use for ruminants has been banned across the EU since 1994, but it had
remained in use for pigs and poultry, as situation mirrored in Cyprus. The
Committee's stance comes on the heels of a European Commission call on
member states to adopt relevant measures already in force in Britain. The
Cyprus Agriculture Ministry has committed itself to following any EU advice
on the matter. Cyprus has not been importing or producing any MBM to feed
ruminants since 1993. But there is no ban on feeding MBM to pigs and
poultry. On the contrary, it remains a common practice, the chairman of the
House Agriculture Committee, Christos Mavrokordatos of AKEL, told reporters
after yesterday's meeting. Butchers fear concern over the spread of BSE
might account for a recent fall in beef sales, though the trend also
coincides with a pre-Christmas fasting period. "Cyprus' beef is safe," said
Mavrokordatos. "But it is time to ban imports and production of meat and
bonemeal to feed pigs and poultry to protect them, and ourselves by
extension, from getting any disease. We should have done this long ago to
restore consumer confidence in meat and to safeguard the country's
agricultural activity. We could have stopped sales from going down," he
said, adding that the Committee had called on the Agriculture Ministry to
take immediate action to implement its proposal. Mavrokordatos and
representatives of farmers' unions present at the committee complained
about the operation of MBM production units in Cyprus. "The units are never
inspected. Sick animal parts could make their way into meat and bonemeal
used to feed pigs and poultry," Mavrokordatos said. And he added there were
not enough vets inspecting agricultural units and slaughterhouses. "There
are only 15 vets inspecting 56 slaughterhouses. And 5,500 agricultural
units are inspected only once every two years each. It is time to wake up
and take some action."
[05] Finance Ministry has second thoughts about third child cash handout
THE LABOUR Ministry's proposed £5,000 carrot to spur couples into having a
third child has run into trouble at the Finance Ministry, prompting a
review of incentives on how to increase the island's dwindling birth rate.
"Incentives for a third child seems to be the best solution, but the
different options are still being considered," said Doros Ioannou, the
Labour Ministry's Permanent Secretary. The Ministry had proposed a one-off
£5,000 payment for the birth of a third child, but Ioannou told the Cyprus
Mail the Finance Ministry had some objections after estimating the plan
could cost the state £8-10 million. Ioannou said that, among the
discussions, various suggestions had arisen, including an overhaul of the
entire child benefit system. Another suggestion included adopting the
fourth-child system for the third child, but this would also prove costly
to the state. Ioannou said the options would be re-examined before the
issue was submitted to the Cabinet for approval. Currently, only families
with four or more children receive child benefit of £26.64 per month per
child. The payments continue for as long as the children are dependent,
until their mid-twenties if they do their military service then go on to
university. However, couples with less than four children receive nothing
from the state. The Association for Large Families, which only represents
families with four and more children, said even the fourth-child allowance
was inadequate compared to other European countries. Association president
Demos Pissourios said yesterday that child benefit should be increased.
"Compared to the allowances given in Europe, it's very small," he said. He
welcomed the government's £5,000 proposal. "We hope couples that have a
third child will proceed to a fourth," he said. There are 24,000 families
in Cyprus with four children and over. The largest family on the island has
14 children. The previous record was 18, but Pissourios said they had all
grown up. Ioannou said some families who already had three children had
requested a meeting with Labour Minster Andreas Moushiouttas over the £5,
000 payment. One woman, whose third child is now six years old, said
yesterday she was "disgusted" with the government's proposal to hand out
the lump sum for future third children. "Where does that leave us? We still
have three children and receive no help whatsoever," she said. "All
children should receive benefits and the older they get the more you need
it. There are poor families with only one and two children as I'm sure
there are well-off families with four and five children." If the proposed
£5,000 was broken down into child-benefit payments until the age of 18, it
would cost the government £23.14 per family per month. Spread out to cover
the other two children, the figure effectively amounts to child benefit of
£7.71 per month for three-child families, lower than in any EU country,
according to our calculations. But it appears some people are more than
willing to go for the £5,000 option. The Labour Ministry this week received
a call from a man asking when the proposal would come into effect so he
could get a head start.
[06] Don't get too excited about the rain
DESPITE the heavy rainfall of the past few days, water levels in the
island's dams are still four per cent lower than this time last year and
the Meteorological Department says no further heavy showers are forecast
for the next few days. This November has been one of the 12 wettest this
century with 96 millimetres of rainfall, and a fall over the past three
days that was 200 per cent higher than normal. However, Phedros Roussis, a
technician for the Water Development Department, says the drought crisis is
still no closer to ending. "To have enough water for both domestic and
irrigation use, 138 million cubic metres is needed and over the past five
years we have had nowhere near that amount. Certainly there is no
indication that the current water supply restrictions to the cities will be
lifted just yet - we would need several months of repeated rainfall before
it is even considered." On Tuesday, there was an inflow of just over a
million cubic metres, bringing the total content to just 7.1 per cent of
the dams' capacity. The total inflow for the month was more than two
million, compared to 777,000 last year and 833,000 in 1998. Reservoirs and
desalination plants together provide about 35 per cent of the country's
water needs. The rest comes from aquifers, but these are currently being
over pumped at a rate of approximately 30 million cubic metres a year. The
weather over the weekend is not expected to bring significant quantities of
additional rain. Loizos Stefanou, the acting director of the island's
Meteorological Service predicts: "It seems the main activity has already
passed and on Friday we can expect to see everything stabilising. The
weather will improve and there will be only a few isolated showers." This
weekend is expected to be fine with long periods of sunshine and only the
odd shower. Stefanou warns that the fact that we experienced heavy rain in
November is no indication we are about to experience a particularly wet
winter.
[07] Government says report shows improved image
ONLY two cases highlighted in the Auditor-general's annual report concern
the operation of the state mechanism, the Government Spokesman said
yesterday. The Auditor-general's report for 1999 contained a plethora of
cases involving fraud and irregularities, prompting the Council of
Ministers, Attorney-general Alecos Markides, and Auditor-general Chrystalla
Yiorkadji yesterday to probe into the cases and decide on measures to avoid
a repeat of similar situations next year. After a long session, the Cabinet
decided that the report demonstrated the government's improved image,
compared to previous years. Government Spokesman Michalis Papapetrou said
after the session that the Cabinet had studied the report and suggested
specific measures to tackle weaknesses. Only two cases involving fraud or
criminal offences directly affecting the government required investigation,
Papapetrou said. The first case concerns alleged irregularities at Cyprus'
Cairo embassy involving then ambassador Charalambos Kapsos, while the
second called for investigation into a theft of asphalt from the Kykkos to
Stavros Tis Psokas road construction site. In the first case, the Foreign
Ministry was also criticised last month by Ombudswoman Eliana Nicolaou for
failing to order a disciplinary probe into the embassy case. Kapsos is
currently suspended pending the outcome of a police probe into charges that
he abused his position by throwing parties at the state's expense. But the
irregularities that Nicolaou criticised the Ministry for not probing are
not Kapsos' alleged misdemeanours, rather abuses at the embassy that the
suspended ambassador lodged complaints about in late 1998, eight months
before his name made the headlines for the wrong reasons. Concerning the
asphalt theft, Yiorkadji found that the government had in July and
September 1999 paid £247,054 for a smaller quantity of asphalt mix than the
one agreed with the constructing company. The Attorney-general had then
launched an investigation, which remained incomplete because vital
documents had mysteriously vanished from the Nicosia District Officer's
Department. But the company was willing to pay the money plus interest back
to the government, aiming at preserving the two sides' good co-operation.
The question, however, remains. Where did the asphalt go? As for the rest
of the wrongdoings listed in Georkadji's report, Papapetrou said they did
not concern the government directly, but involved local authorities and
other organisations. Papapetrou revealed that the Cabinet had decided that
from next year separate reports would be drafted for the government, semi-
governmental organisations, and local authorities. In addition, Papapetrou
said, a ministerial committee including the Attorney-general and Auditor-
general would be set up to study ways of improving management in the state
mechanism. The committee would be ordered to submit its suggestions back to
the Cabinet in three months. Yesterday, President Glafcos Clerides urged
the Attorney-general to pursue without delay all cases involving criminal
offences and to brief the relevant ministries.
[08] Plenty of time for Denktash to change his mind, says De Soto
THE UN does not consider last week's threats by Turkish Cypriot leader Rauf
Denktash not to show up at the Geneva talks in January as the final word on
the issue, Alvaro de Soto said yesterday. Speaking after a meeting in
Athens with Greek Foreign Minister George Papandreou, the UN special envoy
for Cyprus said there was no onus on either side to confirm their
attendance at this point, but hoped they would both show up in Geneva. "The
invitation was issued personally, orally, by the Secretary-general, I am
sure that Mr. Denktash as well as Mr. Clerides will respond in the same
manner at the appropriate time," De Soto said, adding that since the talks
were slated for late January there was "no great rush". "Mr. Denktash in
Geneva promised that he would evaluate the Secretary- general's invitation
to the talks and I look forward to discussing the matter with him when I go
to the island," he said, referring to his upcoming visit, which begins on
Sunday, following his contacts in Athens and Ankara this week. De Soto
added that he would rather not comment further before talking to Denktash.
In response to reporter's questions on what would happen if Denktash
decided not to go, De Soto said he did not wish to answer hypothetical
questions. He said the UN had not received a reply to the invitation from
either side, but the Secretary-General hoped both would be there.
Papandreou repeated Greece's support for UN efforts to find a comprehensive
federal solution, within the framework of UN resolutions and Security
Council decisions. He said he had had the chance to exchange with De Soto
views on the progress of talks and the future steps the Secretary-General
would take. President Glafcos Clerides has said the government's approach
to the talks is positive, but the final decision on whether to attend would
be taken after the Secretary-general issued his report on Cyprus and the
Security Council its resolution on the renewal of the UNFICYP mandate in
mid-December. Foreign Minister Yiannakis Cassoulides repeated this on his
return to the island late on Wednesday. Cassoulides said the government's
diplomatic services were working diligently and had already acted to
prevent any negative references in the UN chief's report and the UNFICYP
mandate. "Our side has said it has all the good will to attend the talks
but its final decision will be taken after the Secretary-general's report
and the Security Council resolution," he said. Last week, Denktash said the
talks were a waste of time unless the UN recognised that they must he held
on a state-to-state basis centring on a confederal solution. He was also
angry over the Cyprus government's plans to participate in a European army.
But UN Secretary-General Kofi Annan said this week that the Turkish Cypriot
leader should not carry out his threat boycott the next round of talks, a
comment which has been welcomed by the government as a positive step. "I
hope his position is not final. I think we are at relatively early stages
of the talks and I know he was not particularly pleased with some of the
suggestions I put forward at the last meeting in Geneva," Annan told
reporters in New York. "I expect him in Geneva, and I expect Mr. Clerides,
we have lots of work to do, the people need it, the people deserve a stable
situation. I think if we work diligently at the system, we will get the
results we all seek and I expect them in Geneva and I will be there."
[09] Cyprus FTSE index launched
By a Staff reporter
THE NEW Financial Times/Cyprus Stock Exchange (CSE) index, the FTSE/CySE20,
goes into operation today. The `top performing' companies picked for
inclusion in the index had to meet criteria such as daily volume, a minimum
of 30 per cent free float and a high market capitalisation. The list of
companies on the index will be reviewed every six months. The twenty
companies initially included in the index are Bank of Cyprus, L.K.
Globalsoft.com, Sharelink Financial Services, Hellenic Bank, Louis Cruise
Lines, Libra Holidays Group, Glory Worldwide Holdings, KEO, Cyprus Trading
Corporation, Malloupas & Papacostas Trading, D.H. Cyprotels, Severis &
Athienitis Financial Services, Salamis Tours Holdings, Orphanides
Supermarkets, Universal Savings Bank, Minerva Insurance, Avacom Computer
Services, Options Eurocongress and F.W. Woolworth & Co. (Cyprus). Approved
investment and holding companies have been excluded from the new index. The
CSE will hold a news conference today to announce further details.
[10] Teachers call off action to give talks a chance
By a Staff Reporter PRIMARY and nursery school teachers yesterday called
off their strike action for three days, paving the way for the resumption
of negotiations with the government over their pay demands. The gesture
came after House president Spyros Kyprianou pleaded with the teachers to
give talks a chance. Education Minister Ouranios Ioannides welcomed the
teachers' move and said he would convene the relevant ministerial committee
to discuss the strikers' demands today. Representatives of teachers' union
POED will be invited to the committee meeting, Ioannides said. The island's
4,500 primary and nursery teachers have been working to rule for over a
week in a bid to secure pay equal to that of their colleagues in secondary
education. The strikers also called a two-hour stoppage last week and an
all-day strike on Tuesday and are threatening an indefinite strike. Parents
groups are threatening to take action of their own if the strike continues.
Cyprus Mail 2000
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