Cyprus News Agency: News in English, 04-04-07

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From: The Cyprus News Agency at <http://www.cyna.org.cy>

CONTENTS

[01] EU Commission predicts cautious positive growth for Cyprus in 2004

[02] Cyprus President says ''No'' to Annan plan in view of referendum (1)

[01] EU Commission predicts cautious positive growth for Cyprus in 2004

3040:CYPPRESS:09

EU Commission predicts cautious positive growth for Cyprus in 2004

by Nicos Bellos

Brussels, Apr 7 (CNA) -- The European Commission Spring Economic Forecast 2004 -2005 predicts a cautiously positive outlook for 2004 for Cyprus.

While noting that there will be a relatively strong growth, the prospects for reunification entail both upside and downside risks.

In its economic forecast the European Union said for 2004 GDP growth is projected to climb to 3.4%, strengthening further in 2005 to 4.1% as external demand picks up.

The EU said that with relatively low growth continuing in 2003, unemployment rose slightly to 4.4% up from 3.9% in 2002, noting that for this year and unemployment is expected to inch lower again as GDP growth picks up.

Inflation, it added, climbed to 4% for 2003 but it is foreseen drop back to about 2% for 2004 and 2005, following similar VAT-hikes and inflation paths in the past.

Investment growth is expected to recover, encouraged by EU accession, liberalization in financial and utilities markets and infrastructure projects. From the nearly 3.0% decline of 2002, it is expected to reach 7% in 2004 and 7.5% in 2005

Regarding public finance, the forecast noted that after slipping in 2002, fiscal consolidation went further awry in 2003 and the consolidation programme was effectively abandoned in the course of the year.

Increased spending, it added, through higher defence outlays and expansionary measures to offset subdued external demand plus revenue shortfalls linked to low growth and tax avoidance, led to a government deficit of 6.3% of GDP, even higher than the 5.2% autumn forecast.

The report predicted a gradual decline-but still relatively high-deficit of 4.6% of GDP and 4.1% of GDP by 2005.

It noted that the projections are subject to unusual uncertainty as negotiations for a settlement of the Cyprus problem restarted in 2004 and the islands economic situation would fundamentally change.

Furthermore, it stressed the need to further develop other sectors of the economy and not to solely depend on tourism.

CNA/NB/EC/GP/2004 ENDS, CYPRUS NEWS AGENCY

[02] Cyprus President says ''No'' to Annan plan in view of referendum (1)

2200:CYPPRESS:10

Cyprus President says ''No'' to Annan plan in view of referendum (1)

Nicosia, Apr 7 (CNA) -- Cyprus President Tassos Papadopoulos said ''No'' tonight to a Cyprus settlement plan proposed by UN Secretary General Kofi Annan, in view of a referendum to be held in the Greek Cypriot side, simultaneously with a referendum in the Turkish Cypriot side, on April 24.

President Papadopoulos gave his position in a live televised proclamation, during which he called on the people of Cyprus to say a definite ''No'' in the referendum.

He said the final Annan plan does not satisfy the minimum aims set by the Greek Cypriot side, but meets the main demands of the Turkish Cypriot side.

The Annan plan, he added, does not lead to the reunification of the island but in fact makes the division permanent.

The Cypriot President said each people forms and writes its own history, adding that the people of Cyprus are writing the future of their island.

He stressed the need for unity during these trying times and noted that whatever the result of the referendum, everyone should respect it.

President Papadopoulos said the decision was up to the people of Cyprus and expressed hope that foreign powers would respect this.

He said he could only provide guidance and explained the reasons behind his decision.

President Papadopoulos noted that the criterion of his evaluation of the Annan plan was to serve the interests of all Cypriots, Greek Cypriots and Turkish Cypriots alike.

Efforts for a solution of the Cyprus problem will not end on May 1st, when Cyprus officially joins the EU, the Cypriot President assured.

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