|Thursday, 19 September 2019|
Cyprus Mail: News Articles in English, 98-01-08
From: The Cyprus Mail at <http://www.cynews.com/>
Thursday, January 8, 1998
 CA still deep in the red despite 2nd half profitBy Hamza Hendawi
CYPRUS Airways, the island's troubled and cash-strapped national carrier, yesterday announced pre-tax profits of £5.4 million in the second half of 1997 - reducing by almost half its projected losses for the whole of last year.
"We know that in summer we always make a profit, but we didn't expect it to be this much," Tassos Angelis, the airlines's spokesman, told the Cyprus Mail. "It is due to an increase in passengers, together with new managerial and pricing policies," he added.
News of the July 1-December 31 profits, however, failed to have any impact on the company's shares. Reflecting the low esteem in which the company is held by investors, market traders said that not a single Cyprus Airways Group share changed hands in trading yesterday. The price of the shares, which are often dormant, is £0.37 apiece, down by £0.13 from its nominal value.
"Cyprus Airways is a company which has failed to convince investors of its viability," said Neophytos Neophytou, managing-director of AAA United, a Nicosia-based brokerage. "It is performing unpredictably and its future is vague," he said.
The company's projected losses for last year are now expected to be around £4.2 million, its statement said. It registered losses of a staggering £9.6 million in the first six months. In 1996, the company made pre-tax losses of £5.2 million, a turnaround from a £5 million profit in 1995.
The Cyprus Airways Group comprises the airline, its charter arm EuroCypria, Cyprair Tours, and Duty Free Shops Ltd.
The government owns 80 per cent of the group and is obliged under Cyprus Stock Exchange regulations to relinquish at least 10 per cent of its holding by March 1999. The regulations aim to enforce a ceiling of 70 per cent on any single holding in a listed company.
Yesterday's announcement of the July-December profits came at a time when the Cyprus Airways management is involved in what appear to be tortuous negotiations with the airline's trade unions over a strategic plan, touted by company chairman Takis Kyriakides as the only way to nurse the national carrier back to good health.
The plan provides for cost-cutting, wage freezes for the group's estimated 2,000 employees, and a package of measures to increase productivity.
The government has not yet made public its plans to reduce its stake in Cyprus Airways to 70 per cent or lower, but traders believe that a private placement is the most probable course of action.
Cyprus Airways shares are still a promising investment despite its poor showing, according to market traders.
"Investors know that the break-up value of the company is much greater than its book value," said Ioannis Andronikou of Suphire Securities Ltd, another Nicosia-based brokerage. "If we consider the company's assets value, the shares should be 70 to 75 cents apiece," he told the Mail.
Neophytou of AAA United gives a slightly different explanation as to why investors are holding on to their Cyprus Airways shares.
"People are holding on to the shares in the hope that one day the government will sell off a chunk of its holding to a third party and the shares will pick up," he said.
Top Cyprus Airways officials speak privately of an alliance with a major foreign airline, or the government relinquishing its majority stake in the company through a sell-off to private investors as the only hope for the company's survival.
"Anywhere else in the world, this company would have been liquidated and its assets sold off," said one market trader who did not want to be named. "But in Cyprus it is kept going because of its sentimental value and the prestige it holds as the national carrier and the link with the outside world."
 Budget debate becomes election forumBy Martin Hellicar
THE OPENING session of the House plenum's three-day budget debate took on a distinct pre-election character yesterday afternoon.
Party leaders - depending on their affiliations for next month's presidential elections - took their turns on the podium to either praise or slam the record of the Clerides government. The Cyprus problem, rather than the 1998 budget, was the main focus for the addresses.
Disy leader Nicos Anastassiades, whose party is backing Clerides' re- election bid, said the president's foreign policy had brought tangible results - the reinforcement of the Common Defence Dogma with Greece, the start of EU accession talks and the "internationalisation" of the Cyprus problem.
On the economy, he said spending on health, education, culture and sport had been increased by more than 70 per cent, and six times more had been spent supporting industry than under the previous government.
Demetris Christofias, whose party Akel is backing former Foreign Minister George Iacovou in February, rejected Anastassiades' claims. He described 1997 as a year of "serious backsliding on the Cyprus problem, bringing us close to permanent division". He said he did not believe a post-election US initiative for a settlement - much touted by Clerides and Disy - would materialise.
He also slammed the government's economic record: "Clerides inherited a healthy economy and is handing over a destitute economy with a whole series of problems," he said.
During the five years of Clerides government, Christofias said, wages had come down in real terms, public debt had doubled, and bankruptcies had increased threefold. The Akel leader described the government's handling of the economy as "amateur".
Diko parliamentary spokesman Tassos Papadopoulos chose the middle ground. Diko is also backing Iacovou, after recently abandoning a coalition with Disy which got Clerides elected five years ago.
Papadopoulos said he did not feel sure the US would ever exercise the pressure on Turkey that he said was necessary for a settlement. He also said the truth about the economy was "somewhere between the rosy picture presented by some and the edge of disaster scenario presented by others".
The attacks on the government's Cyprus problem and economic policies were then resumed by both Edek leader Vassos Lyssarides and United Democrats chief George Vassiliou - both standing as a presidential candidates with the support of their own parties.
The debate continues with all-day sessions today and tomorrow before deputies vote on the budgets, which are expected to be approved.
 Galanos says Diko has lost touch with rank and filePRESIDENTIAL candidate Alexis Galanos said yesterday there was a rift between the governing body of Diko and its rank and file supporters.
Galanos told a news conference he had decided to stand as a Diko candidate in next month's presidential elections after "serious dialogue and a feeling of responsibility towards the role of Diko and its future".
Dismissing Diko leader Spyros Kyprianou's criticisms of him, Galanos said such tactics were an attempt to "keep support from a large proportion of Diko who do not agree with Mr Kyprianou", who is backing George Iacovou.
Diko has joined forces with left-wing Akel in backing Iacovou, who is described as an independent candidate.
"I believe there is a rift between today's leadership (of Diko) and ordinary people," said Galanos, adding that Diko supporters had wanted the party to forge an independent course with its own candidate.
He replied to Kyprianou's accusation that his candidacy constituted a "second for Disy" by saying he was the "first candidate of Diko".
Pointing out his certainty that there would be a second round of voting on February 15, he said Kyprianou and the current Diko leadership had steered the party away from its decisive role as a member of the opposition.
Galanos also pointed out that abandoning the Disy-Diko governing coalition had "not been justified by convincing arguments".
He called on Diko supporters "not to surrender their vote... to any interests", and said the deciding role in the election would now be played by himself, the socialist party Edek, the United Democrats and possibly the New Horizons party.
 Matsakis rejoins Diko ranks as pre-poll insults flyBy Aline Davidian
FORMER Diko Deputy Marios Matsakis, who in March declared himself independent of any party, announced yesterday he was rejoining the ranks of the party led by Spyros Kyprianou.
He said that "in these difficult days for the country" he had asked to be, and had been, reinstated as a Diko member of the House of Representatives.
Matsakis attributed his withdrawal as a Diko Deputy last year to Diko's disagreement with President Glafcos Clerides over the Cyprus problem.
He said he is now convinced that Diko would "never back down over securing a solution" for the island.
Matsakis said he believed Diko would unite the electorate in the face of mounting political confusion.
Also lending his presence to the tumult of pre-presidential election activity yesterday was Diko deputy Tassos Papadopoulos, who said he was backing George Iacovou.
He said his views on the five-year Disy-Diko alliance were well known, and pointed out that his recent absence from the political arena had been because of bad health.
Iacovou is currently supported by left-wing Akel and right-wing Diko in a pre-election alliance.
Meanwhile Government Spokesman Manolis Christofides and Disy leader Nicos Anastassiades launched a counter-attack yesterday on Akel leader Demetris Christofias, who accused President Clerides on Tuesday of being an apologist for Eoka B criminals and of undermining Archbishop Makarios.
Christofias also branded Clerides "a leader who was ready to sell out to the Turks" and who was too old to govern the country.
"Political ethics do not permit insulting conduct toward the president of the republic" Christofides said yesterday, adding: "Nor is the person making the insults excused by the fact that the president is also a presidential candidate."
He called the Akel chief's remarks "a black page in political history"; they were a "manipulation" of the truth aimed at confusing the public and to achieve political ends, he said.
He said the reference to Clerides' age rendering him incapable of governing the country if elected was "unpardonable".
The government spokesman said the people had noted in Clerides the qualities of a "humane leader with great physical, mental and inner capabilities".
These qualities had led Clerides to make a great contribution in the Cyprus problem, the island's European Union bid, and the military alliance with Greece, Christofides said.
He said the candidate backed by Christofias - Iacovou - was "like a wild bull, who, with statements he has made... has endangered and caused destruction" in the areas where Clerides has been most effective.
Christofides also clarified earlier remarks made by Clerides in response to the Akel leader's statements.
When Clerides said Christofias should be examined by a doctor, he noted, he did not mean a medical examination, nor was he making any reference to the Akel general-secretary's state of health.
Disy chief Anastassiades said that because Christofias had made his allegations in writing, he could not even excuse himself as having spoken "in the heat of the moment".
He said Christofias' statements were made under the wrong impression that he had described George Iacovou as "inexperienced".
These remarks had in fact been made by Diko leader Spyros Kyprianou and United Democrat and Edek leaders George Vassiliou and Vassos Lyssarides, Anastassiades said.
"I merely repeated statements made by other candidates," said Anastassiades, adding that retaliatory remarks should be aimed at those who had made the allegations in the first place.
 New talks 'need new common ground'By Jean Christou
TURKISH Cypriot leader Rauf Denktash said yesterday new common ground had to be found to restart the abandoned intercommunal talks.
"Now we have to find new common ground for starting the talks. The common ground is the reality on the ground,"
Denktash told Reuters news agency in an interview after a meeting with UN Cyprus envoy Gustave Feissel.
Denktash last month declared the talks "dead" following the European Union's decision to invite Cyprus to begin membership talks.
"We want the world to treat the Greek Cypriot government for what it is, a Greek Cypriot republic, and not a legitimate representative of the whole island," Denktash said.
Denktash said he had told Feissel that "reality on the ground" entailed recognition of his state as a legitimate one. "Two cultures, two democracies, two governments, two states exist in Cyprus today," he said.
Denktash has also entered the row over the 'Cordovez documents' telling Turkish Cypriot newspaper Kibris that UN special envoy Diego Cordovez had no authority to prepare documents on the Cyprus problem.
He added that he did not take seriously reports that Cordovez would be bringing documents to Cyprus in March.
Denktash's comments to the paper were in response to statements by Foreign Minister Yiannakis Cassoulides last Saturday that Cordovez was preparing documents for his visit to the island in March, immediately after the presidential elections.
The documents are reported to include the text of a draft constitution, the outlining of the borders for Greek and Turkish Cypriot territories, solution proposals on the problems of immigrants and forcibly displaced persons, basic freedoms, economic problems and a security package.
The Turkish mainland newspaper Turkish Daily News, quoting political observers, said the "set of documents" for the resumption of talks could backfire.
Aytug Plumer, the 'TRNC ambassador' in New York, said the talks scheduled for March could no longer be between communities but must be between states.
"The United Nations bears a special responsibility on the Cyprus problem... Secretary-general Kofi Annan was supposed to mention in his report to the Security Council the TRNC's position," Plumer said. "The signal the UN will give is very important. It is clear that the UN does not have any function such as recognising states, but it should not stand by, looking at the issue. The parties are clear at the negotiating table but nowhere else. We cannot accept this."
UN sources told the paper the documents would not be binding and are aimed only at guiding the parties.
Cassoulides had also made it clear last Saturday that the documents being prepared were not a solution to the Cyprus problem but an analysis of each of the main issues which could be used to take the intercommunal talks further along.
However the whole matter has become bogged down in the run-up to the presidential elections, with Akel and Diko-backed candidate George Iacovou questioning the existence of international initiatives on Cyprus.
In an immediate response President Clerides listed a selection of envoys who would be visiting the island after the elections.
In addition to Cordovez he said US emissary Richard Holbrooke and Britain's special envoy Sir David Hannay would also be visiting.
Cassoulides continued his attack on Iacovou's comments yesterday, saying significant developments are expected on the Cyprus issue in March.
He called on Iacovou to state what policy he will follow given that Diko wants to set preconditions for the talks and Akel favours dialogue without preconditions.
Diplomatic sources said yesterday the fuss over the Cordovez papers and visit is merely the result of electioneering tactics before the presidential election.
 Government slams Turkey's human rights recordTHE government yesterday questioned Turkey's participation in the 'Reliant Mermaid' naval exercise with Israel and the US because of its human rights record.
"The aim of the exercise is not compatible with the human rights violations in Turkey and the genocides this state has carried out," Spokesman Manolis Christofides said.
"We are following developments. We have been given assurances that the exercise has nothing to with Cyprus," he added.
The joint search and rescue exercise was staged yesterday off the coast of the Israeli port of Haifa.
 Tumour risk for mobile phone users 'an assumption'By Andrew Adamides
MOBILE phone users need not worry that they may be at greater risk of developing brain tumours, a Nicosia cancer specialist said yesterday.
Dr P.A. Kitsios told the Cyprus Mail there were "no studies or statistics to suggest mobile phone users were more at risk than others".
Any connection was, he added, no more than "an assumption".
Kitsios was commenting after a report on the possible link in the Greek language daily Phileleftheros. The report quoted Australian Cypriot cancer researcher Vasso Apostolopoulou, who yesterday met President Glafcos Clerides, as saying she "believed" mobile phones could cause brain cancer, even though there was no concrete evidence.
Kitsios added that as Apostolopoulou was not a doctor, but a researcher and her specialist field was breast cancer, she would not have the necessary knowledge to answer questions about brain tumours.
The speculation came two days after the World Health Organisation announced it will begin a study of eight countries to see how the incidence of tumours in mobile phone users compares with that in non-users.
The study has been announced as a result of concern in Australia, where the frequency of brain tumours has risen sharply over the past 10 years amid suggestions of a link to increasing use of mobile phones.
However, the project has been cooly received by doctors worldwide. Dr David Secher, of the British Cancer Research Campaign told the Daily Telegraph yesterday that although there had been a slight increase in brain tumours in the UK, this was primarily in the 70- to 80-year-old age group, people who were unlikely to use mobile phones.
He suggested that the higher incidence was primarily due to improved methods of tumour-detection.
 Trade gap widens in January-AugustCYPRUS' trade deficit reached £826.6 million in the first eight months of 1997, an increase of £33 million over the same period in the previous year.
The Department of Statistics and Research said yesterday that total imports, including items kept at bonded warehouses, reached £1.25 billion in the January-August period of 1997, up from £1.22 in the first eight months of 1996.
Exports, however, declined to £424.6 million in 1997 from 432.7 million in 1996.
The island imported £983.6 million worth of goods for domestic consumption during last year's January-August period, up from £959.3 million in the same period of 1996.
 Sales under way after court rulingJANUARY sales have started early this year, with shops taking advantage of a recent Supreme Court ruling declaring the law dictating sales periods to be unconstitutional.
Eager to make up for a generally disappointing Christmas period, high- street shops were yesterday offering price reductions of up to 70 per cent on a wide range of items. Most stores were offering reductions of around 20 to 30 per cent.
The shopping thoroughfares were packed and most shops on Nicosia's Ledra Street reported good trade.
Traditionally, the January sales have started late in the month or in early February, as stipulated by law. However, a Supreme Court judgment last year means there are no longer any restrictions on when a retailer can stage a sale.
 Opposition calls for dismissal of MichaelAKEL, Diko and Edek have called for the replacement of Interior Ministry director Thanos Michael, questioning his ability to act as an impartial returning officer for next month's presidential elections.
House President and Diko leader Spyros Kyprianou yesterday sent a letter to President Clerides outlining the opposition parties' misgivings, and asking for Michael to be shown the door.
Eyebrows were raised late last year when Michael expressed support for departing Interior Minister Dinos Michaelides. Michaelides, a Diko minister, was forced to leave his post when his party decided to abandon the coalition with Disy which got Clerides elected president in 1993.
Speaking at the swearing-in ceremony for Michaelides' replacement, George Stavrinakis, Michael said he "could only hope" to see Michaelides back at his post soon.
There was no immediate response from the government to yesterday's call for Michael to be replaced.
Last week, the chief of the intelligence services (Kyp), Nicos Ioannou, was forced to take leave from his post until after the elections after he caused a storm of protest by publicly assuring Clerides he would be re- elected.
© Copyright Cyprus Mail 1998