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Cyprus Mail: News Articles in English, 99-01-28
From: The Cyprus Mail at <http://www.cynews.com/>
Thursday, January 28, 1999
 Cyta moves towards privatisationBy Hamza Hendawi
IN A MOVE likely to make investors burn with anticipation, Communications Minister Leontios Ierodiaconou announced yesterday that the Cabinet had approved plans that would eventually lead to the privatisation of the island's telecommunications monopoly.
Speaking to reporters, Ierodiaconou said a draft bill submitted to the Cabinet's weekly meeting provided for the creation of a private company to replace the Cyprus Telecommunications Authority, better known by its acronym Cyta.
The government will initially be the sole shareholder in the new company.
Cyta's 2,500 workers, the minister said, would subsequently be allowed to contribute on a voluntary basis to the share capital of the new company.
He gave no further details.
Cyta is among the most modern telecommunications companies in Europe and has been instrumental in the development of Cyprus into a regional services hub over the past two decades.
The surprise announcement came as EU candidate Cyprus appeared to be coming under increasing pressure from its future partners in the European Union to speed up the liberalisation of its economy, particularly the financial and banking sectors, and dismantle state monopolies such as telecommunications.
The island opened membership negotiations with the EU in March last year and hopes to become a member on January 1, 2003 at the earliest.
Cyta is forecast to make a pre-tax profit of £40 million in 1998, according to its chairman, Michalakis Zivanaris. Its pre-tax profits stood at £34.9 million and £26.2 million in 1997 and 1996 respectively.
"We are in full agreement with the government on its plans for Cyta. Privatisation will increase efficiency and make us more flexible," Zivanaris told the Cyprus Mail.
Yesterday's announcement appeared to suggest that the government was finally moving towards the eventual privatisation of Cyta, a target which was repeatedly singled out by chief EU negotiator Leopold Maurer of Austria as crucial to the island's harmonisation with the EU. Maurer was in Cyprus earlier this month for talks on Cyprus' accession course.
Finance Minister Christodoulos Christodoulou meanwhile said yesterday that another draft bill liberalising interest rates had also been approved by the Cabinet and would be submitted to the House today.
The bill, he said, would end a nine per cent ceiling on interest rates decreed by the island's former British rulers in 1945 to combat usury. It also includes provisions designed to cushion Cypriots against steep rises in interest rates, but these will cease to be valid in December 2002, he said.
"The bill is a serious measure toward harmonising the financial sector with EU norms," said Christodoulou.
Share prices, meanwhile, closed weaker yesterday on the Cyprus Stock Exchange with the official all-share index, ending the day 0.49 per cent down at 101.55.
The blue-chip bank shares, however, continued their strong run with their sub-index finishing 0.80 per cent up. The value of trade in bank shares stood at £2.36 million, while the entire value of yesterday's trade was £6 million.
Share prices have risen by about 10 per cent since the beginning of 1999, largely on the back of a major insurance takeover announced by the Popular Bank January 11 and a centenary package of bonus shares, rights issue and warrants publicised by the Bank of Cyprus last Friday.
Thursday, January 28, 1999
 Cabinet threat fails to deter CY strikeBy Jean Christou
IN A vain last-ditch attempt to avert today's four-hour strike at Cyprus Airways (CY), the government yesterday issued a strongly worded threat warning the unions against industrial action.
But the threat failed to scare unions into backing down on their pay demands.
In a written statement, the cabinet said the CY Group's recent return to the black had only come as a result of profits earned by its charter arm Eurocypria and revenues from Duty Free Shops.
"The Council of Ministers welcomes, after two years of losses, the fact that 1998 was a profitable year," the statement said. CY announced profits of some £5 million last year.
"However, an analysis concludes that the company has not managed to carry out the necessary structural changes to secure long-term survival amid increased international competition."
The statement spells out that 1998 profits came from other members of the group and not from the airline itself.
Any money Cyprus Airways itself made came only from its London and Athens routes, "which are still protected" from competition, the cabinet statement said.
The cabinet noted with "particular concern" that labour costs as a proportion of total expenditure were continuously increasing "at a time when those of its competitors, which are already low, are decreasing". Cy labour costs are in the region of 35 per cent of total expenditure.
"It is obvious the long-term survival of the company has not been secured," the statement said.
It also expressed its regret that, under these conditions, the unions had chosen to resort to "unnecessary" strike action, and called both sides to a dialogue.
"If this does not happen, the government, taking action in the wider interests of the economy and the country, will take necessary measures to protect air transport in Cyprus," the cabinet said.
However, Communications and Works Minister Leontios Ierodiaconou, who handed out the statement after the cabinet meeting, said he could not say what such measures might be.
He said there were short-term measures and longer-term ones, which could be implemented. Ierodiaconou also said the government would not back down on its position and would not negotiate under threat of strike.
CY spokesman Tassos Angelis yesterday welcomed the government's statements. He said the next move was up to the unions.
But Cynika union, the airline's largest, whose 1,200 members will take part in today's strike, yesterday remained unabashed and criticised the government's stance.
Cynika president Costas Demetriou told the Cyprus Mail that the union regretted the cabinet announcement. "They decided without hearing both sides, which is not right," he said, adding that the government had made no attempt to contact the union for its views.
And Demetriou dismissed the government's warnings: "All employers like to threaten their employees. This is the game," he said, adding that the strike would go ahead.
Cynika will be joined on strike by engineers union Assyseka, which said yesterday its members would also stop work today. The union had until now simply said it backed the Cynika action and would not breach picket lines.
The strike, between 7am and 11am, affects 16 flights and some 1,500 passengers from the 2,500 expected to fly with CY during the day.
The action will cost the struggling airline hundreds of thousands of pounds.
Cynika is seeking a 4.5 per cent rise in wages and other benefits, in line with increases given to semi-government bodies.
It says the union has not made any claims in the past two years because of the company's financial situation.
But CY says it traded several financial concessions with the union in return for industrial peace in 1998, and claims the unions are now attempting to seek even more than what they might be entitled to.
Cynika will meet on Monday to decide whether further strike action will be necessary.
Thursday, January 28, 1999
 Christofias returns to public life after kidney treatmentAKEL general secretary Demetris Christofias yesterday returned to his duties after a one-month absence due to kidney illness. It was also announced that he would be undergoing a kidney transplant in two to three months.
Christofias was accompanied by his two doctors and wife Elsie, while making statements at a news conference yesterday.
Visibly moved, 52-year-old Christofias said: "They are with me today because during the last month all three have spent all night at my bedside and have fought, and I mean that literally, to save my life. They have saved it."
He said his wife, kidney specialist Dr Alkis Pierides, and his long-time doctor and heart specialist Dr Michalis Minas, had together made it possible for him to return to public life yesterday. "I thank them with all my heart."
Christofias went on to express his gratitude to President Glafcos Clerides, Archbishop Chrysostomos and others from the political arena and clergy for the support they showed during his illness. He went on to acknowledge caring sentiments from Greek politicians, but, "most of all, I thank the everyday anonymous people."
Christofias said his greatest wish was to spend his retirement with his wife, and that, whether or not he was still in his current position when his time came to retire, he would leave his office.
Dr Pierides told journalists that Christofias was suffering from chronic kidney failure and would be treated with dialysis for the time being. He continued that, in two to three months, Christofias would undergo a kidney transplant. The organ is to be provided by one of Christofias' four sisters.
Dr Minas said Christofias had always put his duties before his health and that what had happened was inevitable.
Christofias had been in hospital since December 22 when he was diagnosed with bronchial pneumonia following a visit to London. He suffered kidney damage during treatment for this condition.
Thursday, January 28, 1999
 Murder victim feared suspect would kill himBy Charlie Charalambous
A 27-YEAR-OLD man was yesterday remanded for five days on suspicion of carrying out Tuesday's gangland murder in Limassol.
Pavlos Hadjicostas could face charges of premeditated murder, after 20 shots were fired at 33-year-old George Ioannou, alias Kotsoudkias, as he left a Limassol cabaret with a Ukrainian stripper at 5.15am on Tuesday.
Ioannou was hit six times in the chest and stomach from a distance of 10 metres.
Although rushed to Limassol hospital for emergency surgery, Ioannou died from fatal wounds to the chest and stomach twenty minutes later.
With gangland violence apparently spiralling out of control in Limassol, the town's mayor Demetris Kontides put the blame squarely on the government.
"Limassolians are not to blame, but rather the police and the government who have failed to stamp out organised crime and the profits involved," Kontides said yesterday.
Investigating officer Andreas Karyolaimos told a Limassol district court that police had evidence to suggest the victim had named the suspect as his killer.
On two occasions, Ioannou told police that he feared for his life and also confided to a close relative that he believed Hadjicostas wanted to kill him.
Ioannou apparently believed that Hadjicostas thought he was involved in a bomb attack on his father Michalos back in March 1995.
Michalos Hadjicostis, a close friend of the Aeroporos family, narrowly survived a bomb attack, but in August that same year died in a car crash that his relatives claim was not an accident.
Investigators also know that Ioannou was a close friend of Tassos Simellides. He left the island last December with a new identity after turning state's evidence against the Aeroporos brothers.
In June last year, Hambis, Andros and Panicos Aeroporos were acquitted of the attempted murder of Larnaca club owner Antonis Fanieros, after a criminal court deemed that Simellides was an unreliable prosecution witness.
The event triggered a string of underworld killings, in which the Aeroporos clan and their associates have been the main targets.
Weeks after the acquittal, Andros was gunned down outside a Limassol night club, while his older brother Hambis suffered the same fate last December.
A Czech-made M58 uncovered at the scene of Hambis' murder is thought to be the same used in the hit on Andros.
Two policemen are among five suspects charged in connection with Hambis' murder.
The victim, who ran a Limassol bar owned by Simellides, had also been suspected by police as a drug pusher.
Meanwhile, the House Ad Hoc Committee said yesterday it would recall Justice Minister Nicos Koshis after his allegations that fifth columnists were operating in the police.
At a previous closed meeting of the Ad Hoc committee, Koshis had also alleged that public figures, including politicians, were protecting known criminals.
"The issue of fifth columnists in the police and of public figures being involved needs to be further discussed before filing a full report," said committee chairman Aristofanis Georgiou.
Thursday, January 28, 1999
 Solution now would be 'unbearable' says KyprianouIF A SOLUTION to the Cyprus problem is found under the current conditions, it will be far from the ideal solution, House President Spyros Kyprianou said yesterday.
Speaking after a meeting with Portuguese Foreign Minister Jaime Gama, Kyprianou said "this is not the time" for an "open solution" to the Cyprus problem. He said he was obviously not in favour of maintaining the status quo, but that any solution found now would not be "bearable".
Kyprianou told journalists that this was his reply to a question by Gama as to whether Cyprus was in favour of maintaining the current negotiations or pushing forward for a federal solution.
Gama was on a one-day visit to the island, during which he was received by Kyprianou, by President Glafcos Clerides and met with Chief EU negotiator George Vassiliou. He also held official talks with his Cypriot counterpart, Yiannakis Cassoulides, after which the two gave a joint press conference at which Gama pledged Portugal's support for Cyprus' EU entry.
He said Cyprus was "making excellent progress" with its economy and adaptation of internal law, pointing out that "integrating into the EU depends on the will of the Union but also on the capacity of the newcomers" to respond to set EU economic patterns.
Regarding the Cyprus problem, Gama said a solution "can and must" go in parallel with accession talks, and could have a "positive mutual influence". Portugal, he went on, "would like to have a solution before accession is settled".
Asked about the non-deployment of the Russian S-300 missile system, Gama said this decision had been "well-received at EU level", and expressed the hope that it would generate dialogue which would "lead to a reduction of force levels and to demilitarisation."
For his part, Cassoulides said that among the topics the two had discussed were EU enlargement, co-operation on organised crime, illegal immigration and issues of common interest with the EuroMediterranean partnership. He said that bilateral relations between Cyprus and Portugal were excellent, and that he and Gama had had the opportunity to continue an exchange of views begun in Lisbon last year.
Gama left Cyprus yesterday afternoon.
Thursday, January 28, 1999
 Shopkeepers protest pedestrianisationSHOPS along Nicosia's pedestrian thoroughfares closed early yesterday morning as shop owners came out in protest to demand the return of cars to their streets.
The Ledra and Onasagorou street shopkeepers marched on the Town Hall to hand over a petition demanding that the municipality do something about dwindling takings. Their main demand is that the paving stones be ripped up to allow cars back into the narrow streets. Their bÍte noire is Nicosia Mayor Lellos Demetriades, who insists pedestrianisation is not to blame for the downturn in shop profits.
"No to the new Nero" read a large banner carried by the protesting shop owners, likening Demetriades to the notorious Roman emperor who persecuted early Christians and is said to have played his fiddle while Rome burned.
But not all proprietors joined the two-hour strike against pedestrianisation. More than 30 shops remained open till the 1pm closing time.
Melios Georgiou, general secretary of shopkeepers union Povek, said this strike-breaking action had been expected.
"We knew there were at least 30 people on Ledra street who support pedestrianisation. These 30 stayed open, plus some others who might have been affected by the 30 staying open. But 90 per cent of shop owners are against pedestrianisation," Georgiou said.
In a statement issued the day before the protest, the municipality stated that the majority of shopkeepers had supported the idea of pedestrianisation when it was first proposed in the late 'eighties. Pedestrianisation had created a pleasant shopping environment in old Nicosia, the Town Hall maintained.
"We understand the problems certain shopkeepers face, but we cannot accept that these were created by pedestrianisation," the statement read.
Thursday, January 28, 1999
 Top hotels plead for more quality tourismBy Jean Christou
LUXURY hotel owners yesterday said more top-class establishments were the way forward for Cyprus tourism.
Marios Hamboullas, president of Stek, the Association of Cyprus Tourist Enterprises, said what was needed was a strategy of quality readjustment, upgrading hotel beds from low to high categories.
Hamboullas was speaking at the annual general meeting of the breakaway hotel owners association for four and five star establishments.
The meeting was also addressed by Commerce Minister Nicos Rolandis, CTO chairman Andreas Erotokritou and Hotel Managers Association Chairman John Wood.
In his address, Hamboullas said Cyprus tourism was still on the quantity, rather than the quality path.
"Successful tourism cannot be defined with a head count, because this hides the deep problems in Cyprus tourism where the improvement is only in quantity without a parallel increase in added value," Hamboullas said. "We see length of stay steady and spending per head decreasing."
Hamboullas also said service standards and traditional hospitality were dropping and that the "irresponsible (government) decision" to classify thousands of illegal and unsuitable beds as tourism accommodation also contributed to the problem. But reversing this trend was the raison d'Ítre of Stek, Hamboullas said.
"The government is not to blame entirely," he added. "We too must take some of the blame. Hotel prices have been forced to remain low because Cyprus has entered the game of cheap mass tourism."
To counteract the situation, hoteliers must press for the improvement of infrastructure, the education of staff and reduction in cost.
Hamboullas said the sun and sea model no longer cut ice with tourists. "We need a tourism policy that is clearer in its aims," he said.
Wood urged hotel owners to look at change as an opportunity, rather than a setback. "Innovation is critical and crucial," he said. "Cyprus has to distinguish itself from the rest of the Mediterranean and return to the traditional hospitality values of our fathers to succeed."
Minister Nicos Rolandis, while praising the standard of Cypriot hotels, likewise urged a return to traditional hospitality.
He repeated the government's well-known position to upgrade the tourist product with the establishment of marinas, golf courses and theme parks.
The Minister also expressed optimism that tourist numbers would be up between eight and 10 per cent in 1999, amounting to an additional 175,0000 visitors and bringing the total tourism figure in 1999 to 2.4 million, up from 2.2 million in 1998.
He said what Cyprus had to work out was who its tourist were, what they wanted, and what Cyprus had to offer them.
Tourism brought in around £880 million in revenue last year.
Thursday, January 28, 1999
 Man jailed for vicious family stabbingA LARNACA man was yesterday sentenced to six years' imprisonment for paralysing his prospective son-in-law in a vicious knife attack last year.
Father-of-three Andreas Piskopou, from Leivadia outside Larnaca, broke down and cried as his sentence was read out by the Assizes court, convening in Larnaca.
The 48-year-old had pleaded guilty to causing grievous bodily harm to 26- year-old Sotiris Vassiliou in an attack on December 11. Piskopou stabbed Vassiliou three times with a pen-knife after an argument over Vassiliou's decision to wed Piskopou's daughter Ioanna. The father objected to the couple's engagement because they are second cousins.
The attack took place at Vassiliou's home in Dhekelia and was witnessed by Ioanna. After the stabbing, Piskopou drove Vassiliou to Ormidia police station and later gave himself up to police.
Injuries suffered in the attack cost the victim the use of his arms and legs.
In passing sentence, the court considered as mitigating factors the fact that Piskopou had no previous criminal record, had obviously regretted his actions, had not planned the attack and had been under "severe emotional stress" at the time.
The permanent injuries suffered by Vassiliou counted against Piskopou.
A conviction for grievous bodily harm carries a maximum sentence of 10 years.
Thursday, January 28, 1999
 Police believe gas blast was deliberateA LARNACA apartment building was rocked by what police believe to have been a deliberate explosion at 2am yesterday morning.
A gas cylinder blew up at the entrance of the three-storey 'Lambros' block, causing extensive damage to the lobby, windows and a nearby car.
The police and the fire-brigade rushed to the scene, cordoning off the area. Larnaca police chief Savvas Lardis said the cylinder had been examined by police experts, and that a detonating device had been found attached to its lid.
The apartment block belongs to industrialist Lambros Mathaios and the damaged car to his son-in-law Antonis Nicolaou, who lives in the building.
Thursday, January 28, 1999
 Compromise deal saves Hilton boardBy Anthony O. Miller
THE HILTON Hotel board has saved its skin in a compromise that lets each member keep his seat, while the government gets to name an interim chairman until the next annual general meeting, Commerce Minister Nicos Rolandis said yesterday.
Rolandis, with the Council of Ministers' backing, was about to call an extraordinary general board meeting with the aim of replacing the entire board for rejecting the Cabinet's choice of chairman, Byron Kranidiotis, instead of the chairman the board elected, Marios Pelides.
They failed to reach a compromise among themselves about the chairmanship, Rolandis told the Cyprus Mail yesterday. "So they suggested that, instead of proceeding with an extraordinary general meeting (that could oust them all), that for the time being - at least until the time of the next annual general meeting - I place the director-general of the Ministry, Michael Erotocritos, as chairman."
Rolandis said he liked the idea, as it not only put the lid of compromise on the controversy, but "we shall have the man of the Ministry at the helm, the others will be on the board, and in the meantime we shall try to regulate it."
"I said I'll give them another chance: If they will agree by that time and accept the position of the government (about Kranidiotis as chairman), it's OK. Otherwise... we may change the whole board, or make radical changes (in it)," he said.
He said the Cabinet had decided to keep in limbo the question of whether some £9 million in taxpayer's money was overspent by the board in its £17- million renovation of the luxury Nicosia Hilton under its prior chairman, Andreas Kaisis, some of whose companies got renovation contracts.
A "voluminous" ministry report on the question is still before the Cabinet, Rolandis said. "The position of my ministry is that we do not have the competent people to judge whether... the £17 million was well spent.
The costly construction project added a new wing with 84 rooms and renovated the older section of the Hilton Hotel, as well as purchasing new television sets and renovating the hotel's kitchen.
Only the Ministry of Communications and Works had the requisite expertise, he for such an audit, he said; but no decision had been taken to order one, he added, suggesting it became less likely as time passed.
Rolandis said he did not think there was anything that might justify a criminal investigation into the hotel's renovation. A criminal probe would require "facts to substantiate the allegations.... At the moment we have only the allegations."
The government owns 82 per cent of the Cyprus Tour Development Company (CTDC), which owns the Nicosia Hilton Hotel. The private sector owns the other 18 per cent. The luxury hotel is operated by Hilton International, which is owned by British gambling giant Ladbrokes.
Thursday, January 28, 1999
 Practical measures agreed to deal with immigrantsCYPRUS and Lebanon have agreed on some practical measures to combat the illegal immigration of thousands of migrants, reported to be massing in Lebanon to sail to Europe, but often winding up in Cyprus, Interior Minister Dinos Michaelides said yesterday.
Michaelides said on his return yesterday from Beirut that the measures agreed at a meeting with his Lebanese counterpart, Michel El Murr, took effect immediately and "aim at combatting illegal immigration from Lebanon to Cyprus."
"We have noted down various practical measures concerning illegal immigration, so that every one of these cases is tackled immediately and effectively," Michaelides said.
He said the draft agreement that he had presented to Murr would be signed by both sides "after it is studied by the two governments."
He called his visit to Lebanon "very constructive," adding that while in Beirut he also met with Lebanese President Emile Lahoud, and with Prime Minister Selim al-Hoss.
Michaelides said Cyprus and Lebanon considered the problem of illegal migrants and their smuggling an "international crime" that affects not only Lebanon and Cyprus, but many EU countries.
"What is needed," he said, "is the conclusion of agreements between interested countries, so that this phenomenon is controlled or combatted completely."
He said there were thousands of illegal migrants in Lebanon trying to reach Cyprus, Greece and other European countries. He has pegged that number at around 15,000 in the Lebanese port of Tripoli alone.
On January 15, Cyprus was thwarted in trying to return to Lebanon 29 illegal immigrants, mostly Iraqis, who pitched up in Cyprus two days earlier, after being told by their boat's captain - whom they paid between one and two thousand dollars each - that they were in Crete.
Lebanon finally let six Egyptians among the 29 migrants aboard the Cyprus police launch return to Lebanon, as they had proper entry papers on them.
But Lebanon kept the Cyprus police launch shuttling between Tripoli and Beirut harbours under the guns of a Lebanese naval vessel, refusing to let the remaining 23 migrants back into Lebanon, on grounds that Cyprus had no proof they had originally embarked from Lebanon.
The 23 were returned to Cyprus, where Larnaca District Court jailed them for between 20 and 45 days. The fates of the 18 Iraqis, two Somalis, one Burundian, a Palestinian and a Sri Lankan woman, upon their release, remain unresolved.
Michaelides said he understood Lebanon was already trying to tackle the problem, and in the past six months had kept several boatloads of illegal immigrants from departing for Cyprus.
One immigration police officer, who declined to be identified, told the Cyprus Mail that Cyprus should hereafter adopt a solution he claimed Italy had recently used to return Albanian illegal immigrants to the eastern shores of the Adriatic.
He suggested police should tow boats in which illegal immigrants arrive in Cyprus, back to within the 12-mile limit of Lebanon's international waters, and leave the vessel there as the responsibility of Lebanese authorities.
Thursday, January 28, 1999
 Government to crack down on abuse of diplomatic platesFOREIGN Minister Yiannakis Cassoulides yesterday announced that the cabinet had officially decided to take action over the abuse of diplomatic number plates.
He said the decision had been taken after press reports of the abuses. From now on, he said, the issue of new diplomatic plates would be government regulated, and embassies would each be issued with specific plates.
Prior to the alteration, it appears that anyone with the right connections could get themselves a pair of the green plates, as they were simply issued by car accessory shops.
According to the law, only official diplomats are allowed the plates, which should also be marked CD (Corps diplomatique). But Honourary Consuls also began using them, even though their plates should not be green, but simply marked CC (Corps consulaire).
With the issue never properly regulated, the use of green plates spread to the families of Honourary Consuls and even to others with no diplomatic status whatsoever.
Any accessory shop issuing green number plates was until now supposed to ask to see a previous broken plate, when issuing them for a car already on the road, or official proof of diplomatic status when issuing plates for a new vehicle.
The penalty for false use is a £1,000 fine, a year in prison, or both, but police had a hard time catching culprits, unwilling to risk offence by checking real diplomats.
The bill to regulate the issue of the plates was tabled late last year.
© Copyright Cyprus Mail 1999