Daily Press Review - 16/4/2020

ΠΟΛΙΤΗΣ NEWS Δημοσιεύθηκε 16.4.2020
Daily Press Review - 16/4/2020
President Nicos Anastasiades is expected to have successive meetings with economy stakeholders and social partners on 21 April at the Presidential Palace

In the press today:


We should all exhibit a high sense of personal and social responsibility

Opinion article by Hellenic’s Communications & PR Manager George Sklavos, who says that the pandemic greatly affected both economic and societal structures. These never before seen condition, led each organisation to take important decisions for the safety of its staff, partners and customers as well as for its social activities. At Hellenic Bank, we immediately implemented our Bank’s businesses continuity plans and adapted our operations in accordance with the Ministry of Health. We took all the appropriate measures to protect our colleagues, clients and more in order to safeguard public health while we immediately proceeded with taking measures to support and help our clients. Among other things, we provide innovative facilities and encourage the use of the Bank’s digital channels, so as to limit the need for physical contact or visit to the branches, we simplified the process to open an account for our fellow citizens who are receiving state allowances, we issued debit cards for free and nulled all interest rates for credit cards during these difficult months, until June. At the same time, acknowledging the specially negative economic conditions, we are looking into a series of measures to immediately support liquidity, with a view to support our customers, so that they can exit from this crisis unscathed. The article goes on to report on Hellenic’s CSR activities during this crisis, aiming to support nursing staff and vulnerable groups of the population.



Announcement of audited financial statements delayed

The announcement of audited financial statements for FY 2019 and the submission of annual financial results is being postponed further and further. In fact, many companies cannot publish their financial statements four months after the end of the year. In some cases, due to the coronavirus, companies have changed the dates of their annual general meetings. Hellenic Bank announced that it would delay of the announcement of the Audited Financial Statements for the year ended 31st December 2019, taking into account the evolving COVID-19 pandemic and the developments relating to its efforts to resolve its Non-Performing Exposures (NPEs). Other companies who announced a delay in announcing their audited statements are Salamis Tours, Petrolina, Louis, Toxotis, SFS, Pandora, Leptos Calypso Hotels, Paphos Stone Estates, Layster Investments, Orca Investments, Constantinou Bros Developers, King's Head Development, Constantinou Bros Properties and Lordos Plastics.



Cyprus raises €1.25b from 52-week treasury bills

Cypriot banks, foreign banks and investors from the UK and Greece, Germany, Austria and Germany have lent the state so that it’s able to cover its financing needs that emerge due to the coronavirus pandemic. The Finance Ministry announced on Thursday that by issuing a 52-week treasury bills through private placement with an annual yield of 0.50%., it managed to raise €1.25 billion. 8 credit institutions were part of this process, according to the Minister of Finance. According to Phileleftheros’ sources, six of the banks that supported the country’s liquidity are BoC, Hellenic Bank, Eurobank Cyprus, AstroBank, Alpha Bank and RCB Bank. The sum of €1.2b along with the €1.7b reserve and the €1.75b it raised from international markets, after the recent issuance of a 7-year and a 30-year bond, amount to a total of €4.6b. This sum covers the financing needs that emerge in the case of a basic scenario that was examined by the government. As it comes to the extreme scenario, the state could potentially need a few hundreds of millions of euros, that could be covered through cuts in public spending and/or additional lending. Specifically, Cyprus could raise €160m to support employment through the SURE programme, another €300m from the ESM to support the healthcare sector and €400m from the European Investment Bank to support businesses. These sums will be raised through these specific programmes in early Fall. The state’s financing needs for this year were estimated at €5.5b. It should be noted that the Republic decided to revise its annual financing scheme that was established in December 2019 and referred to the state’s maximum needs for 2020 of €2.25b. It is not ruled out that the state will borrow again if the state’s financing needs increase. This will also depend on the duration of the lockdown and if measures will continue after 12 June. Recently, the Finance Minister said that the fiscal stimulus package by the Government amounts to 5.4% of the GDP or €1.32b.



Sofoklis Parapanos in KEDIPES’ Board

KEDIPES’ Board approved the appointment of Sofoklis Parapanos to the position of independent non-executive member of the Board after being approved by the Central Bank of Cyprus. Parapanos has a degree in Finance from the Northern Illinois University in the US and has 30 years of experience in the banking sector, specialising on matters of global capital markets and finance in new markets. Among other things, he worked at HSBC Wardley Cyprus Ltd as well as in the global credit finance organisation, London Forfaiting Company PLC.

 

Changes in BoC’s board

BoC has announced changes in the composition of its BoD. On 14 April, the BoD of Bank of Cyprus Holdings Public Limited Company and Bank of Cyprus Public Company Limited, decided to appoint Nicos Sofianos as a member in each of the Boards. Mr Sofianos graduated from the University of Manchester in the UK with degree in Chemical Engineering and specialising in Mathematical Modelling and Computer Simulation. He is a Chartered Accountant, member of the Institute of Chartered Accountants of England and Wales (ICAEW) and member of the Institute of Certified Public Accountants of Greece. In the meantime, Maksim Goldman will not claim re-election as Vice-President. At the same time, as part of the process of exchanging Board Members, the two Boards intend to replace Goldman in the Committee on Appointments and Corporate Administration. Finally, the BoD’s of BOC Holdings and the Bank announce that Anat Bar-Gera resigned from the two board to follow other career opportunities. The Boards of the two companies convened on 14 April 2020, accepting her resignation and thanking her for her contributions.

 

Alpha Bank facilitates the opening of bank accounts and issuance of credit cards

Alpha Bank Cyprus Ltd facilitates the opening of accounts and the issuance of credit cards to Clients over 60 years old, with a view to protect the health of it Customers and Employees and to contribute to tackling the difficult conditions due to the Covid-19 pandemic. Specifically, for customers (natural persons) who wish to open a bank account, Alpha Bank Cyprus Ltd has simplified procedures by posting a special form on the Bank’s website www.alphabank.com.cy, which interested parties can fill quickly and easily and send it by email to  AccountRequest@alphabank.com.cy. After the initial process, customers will be called on to sign the relevant documents and submit the relevant supporting documents to the Branch of their choice, in order to activate their account.



Foreclosures freeze to be back on the table

Opposition parties have reported that in the midst of the Coronavirus crisis, banks continue their foreclosure proceedings, and this is why they are making proposals to put the relevant legislation on ice. As AKEL, EDEK and the Greens supports, despite the reassurances of the banks that the foreclosures will be postponed for three months, they have been receiving complaints by borrowers who say that the procedures were continued. Specifically, AKEL will bring back the bill it submitted to the House, postponing all the procedures provided for foreclosures, while the coronavirus pandemic continues. Besides, EDEK’s president Marinos Sizopoulos sent a letter to the House President requesting that the bill for the postponement of foreclosures prepared by the party is voted on. EDEK’s bill foresees the full postponement of foreclosures by credit institutions, KEDIPES and credit acquiring companies until the end of the year.



Citizens disappointed by state allowances

Many of our fellow citizens are disappointed by the allowances that they have been granted by the state due to the pandemic, as part of the Labour Ministry’s stimulus package to support employees and businesses. Many people, just a few days away from Easter, may not have access to absolute necessities, as they report that the state did not make an adequate prediction for all categories of employees. Citizens complained to Politis that they have received especially low allowances that aren’t enough even for the bare necessities.



President of the Republic – Successive meetings on economy on 21/4

President Nicos Anastasiades is expected to have successive meetings with economy stakeholders and social partners on 21 April at the Presidential Palace. According to an official announcement, Anastasiades will chair a meeting with the Cyprus Chamber of Commerce and Industry (CCCI), Employers and Industrialists Federation (OEV), trade unions SEK, PEO and DEOK, hoteliers’ association PASYXE, the Association of Cyprus Tourism Enterprises (ACTE), on matters relating to the economy. He will then chair a meeting with technical chamber ETEK, the land developers’ association and the large-scale developments association.



Facilities to businesses

Businesses who have suffered great financial losses due to the coronavirus pandemic are supported by both the executive and judicial branch of power. Among other things, the state will give incentives to innovative companies as well as will postpone the payment of the annual company fee of €350. Specifically, with a letter to the House, the Ministry of Finance calls on MPs to approve the Income Tax bill for innovative companies that is still pending at the House since January at the next Plenary.



Voucher scheme in the works

Discussions to regulate the return of advance payments that were made by people who intended to holiday in Cyprus this season are in the final stretch. The matter is being handled by the Commerce and Finance Ministries, and Deputy Ministry of Tourism. According to Phileleftheros’ sources, following consultations with the parties involved, they are in advanced stages of concluding a relevant scheme. Tens of millions of euros have been paid to hotels in advance payments, while the situation is also very dire for travel agents. According to the sources, the ministries are seriously considering the case of Greece, which has introduced a regulation that gives tourism enterprises the ability to issue 18-month vouchers as compensation, with the aim of supporting hotels and travel agents, as this will ensure they have immediate liquidity. The same applies for air tickets. If tourists do not use the voucher within 18 months, they can apply for compensation. While the Cypriot authorities are looking at this prospect, it also raises solvency issues. For example, who will compensate the customers of a company (hotel or travel agent) in the event of bankruptcy? The matter was raised by the European justice commissioner yesterday, who said that the case of Denmark was “not bad”, as the country has a guarantee fund for travels.  Either way, the travel agents have changed their policies when it comes to reservations. For example, TUI is trying to make its vouchers attractive to customers, while TEZ TOUR has announced that reservations can be changed for free for holiday packages with chartered flights to Greece, Cyprus, Turkey, Italy and Spain.



Strict procedures for ships and ports

Limassol port and the port’s facilities will continue to operate, but under a batch of strict restrictions and regulations because of the Covid-19 pandemic. The Transport Minister yesterday issued the official list of restrictive measures that are already being followed by the Ports Authority and the port’s operators. Among other, the measures stipulate that the ports and port facilities of Cyprus, which are considered essential services, will continue to operate to support the economy, the health system and the viability and social cohesion of the country. Crews and passengers of all types of ships – including cruise ships – are prohibited from disembarking, nor can crews be replaced, either within or outside of the port. As for tow vessels and other commercial ships, which have a legal base at the Cypriot ports, if they come into contact with citizens of other countries, they must go in 14-day quarantine upon their return. Regarding warships, they are allowed to dock but their crews are not allowed to disembark. Crews of UNIFIL, which has its own facilities at Limassol port, are allowed to disembark but only to be rushed straight to a hotel to self-isolate.



The last cruise ships

The cruise ship “Crystal Esprit”, one of the last to return to their base in ports of Europe and the US, was serviced yesterday at Limassol port, after arriving from the Seychelles via Dubai. “Crystal Esprit”, which only had its crew on board, remained docked for almost 24 hours. It was provided with fuel, food and other essentials.



Exxon did not violate the contract

The ExxonMobil – Qatar Petroleum consortium’s decision to postpone its first appraisal drilling until September 2021 and the second until early 2022 is not a violation of the timeframes provided in its contract with the Republic of Cyprus. It had announced the need for an appraisal drilling in good time and this gave it enough leeway to revise its plans. Following an announcement yesterday by the Solidarity Movement party, which insinuated that the consortium’s decision to postpone the drilling because of the drop in oil prices and the coronavirus pandemic could constitute a violation of its contract with the Republic, as the contract sets out specific timeframes for the drillings, Politis newspaper contacted Energy Minister Yiorgos Lakkotrypis, who said that ExxonMobil did not violate the contract terms. He said that based on the contract, a company is obliged, following an exploration drilling that discovers a deposit, to inform the Energy Ministry on whether it intends to proceed with an appraisal drilling. From the moment that the company informs the ministry that it will exercise its right for an appraisal drilling, which ExxonMobil did many months ago, it has a specific timeframe to move in. Lakkotrypis said the consortium, which holds the concession rights for the Glaucus deposit, informed Cyprus that it would proceed with the appraisal drilling and the new timeframes that have been set (September 2021 for the first and first quarter of 2022 for the second) are within the timeframes set out in the contract. Therefore, there is no problem with the contract. The initial indications for the Glaucus deposit are that it has a natural gas capacity of 5 to 8 trillion cubic feet; though the real quantities will only become known once the appraisal drilling is carried out. Meanwhile, besides these two appraisal drillings, ExxonMobil was also looking at carrying out another exploratory drilling in a different lucrative target in block 10; but with everything that has happened this cannot be considered a given. In its announcement, Solidarity Movement had asked the Energy Ministry: “What kind of contract have these companies signed, that gives them the right to invoke international oil prices?” while it also wondered whether it was true that ExxonMobil has already abandoned Romania, who it was a strategic partner with in the Black Sea. The party also wonders “is it true that ExxonMobil is in fact under a ‘memorandum’ and is having assets foreclosed by its three lending banks?”. It said it hoped the government had a plan in place to prevent ExxonMobil from selling its concession rights to BP, which is a strategic partner of Turkish Petroleum.



Solidarity: Huge threat to the Republic of Cyprusenergy programme

On the topic above, the site provides Solidarity Movement’s announcement in full: “At the same time as the Republic of Cyprus’ Energy Minister, Mr Yiorgos Lakkotrypis, was confirming that ExxonMobil had postponed its drilling in the Cyprus EEZ until September 2021, Turkey’s Foreign Minister Mevlut Cavusoglu was reiterating that the Attila’s exploration activities in the Eastern Mediterranean and the Cypriot blocks would continue as normal; especially now that they have a third drillship at their disposal. Furthermore, when asked if the Eni-Total consortium would also follow in ExxonMobil’s footsteps, Mr Lakkotrypis did not rule it out. The reason given by ExxonMobil was the coronavirus, which was preventing its staff from working, and the huge drop in oil prices internationally. We are directly asking the government: What kind of contracts have been signed with these companies that give them the right to invoke international oil prices? Is it true that ExxonMobil has already abandoned Romania, which it is a strategic partner with for deposits in the Black Sea? Is it true that ExxonMobil is in reality under a ‘memorandum’ and an asset foreclosure programme by its three lending banks, and that it is being forced to sell assets, gradually withdrawing from many deposits across the planet (except its 5 giant deposits), by selling its concession rights? We hope the government has a plan in place to prohibit ExxonMobil from selling its rights in the Cyprus EEZ to BP, which is a strategic partner of Turkish Petroleum.”



Turkey continues to blackmail over energy issues

The coronavirus crisis has not impacted on Ankara’s foreign policy. Turkish Foreign Minister Mevlut Cavusoglu said during an online discussion organised by the Turkish branch of the Atlantic Council that Ankara would continue drilling and even deploy a third drillship. He said Turkey had told the EU, the UN and even Greece that the Greek Cypriots should not have carried out any unilateral activities when it comes to drilling or exploitation in the Eastern Mediterranean before reaching an agreement on a fair distribution of revenue with the Turkish Cypriots. Ankara’s position was however ignored, he said. “We continue to propose a new dialogue on the Eastern Mediterranean at the highest level. President [Recep Tayyip] Erdogan did propose this in London to [Greek] Prime Minister [Kyriacos] Mitsotakis, but Greece prefers to put pressure on Turkey’s legal rights in the region instead of responding to our calls for honest dialogue,” Cavusoglu said. “For reasonable stability, the main goal should be for the two sides to come together on the island for a fair distribution of revenue, and the proposal of the Turkish Cypriot authorities represents the only logical and realistic basis for a solution,” he said, referring to the Turkish Cypriot side’s proposal to jointly manage hydrocarbons planning simultaneously with negotiations on the Cyprus issue. Meanwhile, Turkey issued an illegal NAVTEX yesterday, as it announced the launch of a new illegal drilling by the Yavuz drillship in block 6 of the Cyprus EEZ. The ship will be supported by the Ertugrul Bey, Osman Bey and Orhan vessels, and will start drilling on Monday, 20 April, until 18 July. The NAVTEX bans the passing of ships within a maritime zone of 100 nautical miles. The site of the drilling is 2,590 metres deep and is part of block 6, which Turkey is contesting as its own.



Unborn

Alithia newspaper comments that we have already started counting our losses from the Covid-19 pandemic, including the Republic of Cyprus’ energy programme. The energy giants, having been struck by the oil price crash and drop in demand, have informed Cyprus that at least for the time being, they are postponing their drilling programme. ExxonMobil was the first to inform the Republic that its next drillings may start towards the end of 2021. However, some believe that the EastMed pipeline will also be a victim of the coronavirus. But the virus does not strike the unborn, says the paper.





Voucher scheme in the works

Discussions to regulate the return of advance payments that were made by people who intended to holiday in Cyprus this season are in the final stretch. The matter is being handled by the Commerce and Finance Ministries, and Deputy Ministry of Tourism. According to Phileleftheros’ sources, following consultations with the parties involved, they are in advanced stages of concluding a relevant scheme. Tens of millions of euros have been paid to hotels in advance payments, while the situation is also very dire for travel agents. According to the sources, the ministries are seriously considering the case of Greece, which has introduced a regulation that gives tourism enterprises the ability to issue 18-month vouchers as compensation, with the aim of supporting hotels and travel agents, as this will ensure they have immediate liquidity. The same applies for air tickets. If tourists do not use the voucher within 18 months, they can apply for compensation. While the Cypriot authorities are looking at this prospect, it also raises solvency issues. For example, who will compensate the customers of a company (hotel or travel agent) in the event of bankruptcy? The matter was raised by the European justice commissioner yesterday, who said that the case of Denmark was “not bad”, as the country has a guarantee fund for travels.  Either way, the travel agents have changed their policies when it comes to reservations. For example, TUI is trying to make its vouchers attractive to customers, while TEZ TOUR has announced that reservations can be changed for free for holiday packages with chartered flights to Greece, Cyprus, Turkey, Italy and Spain.



President of the Republic – Successive meetings on economy on 21/4

President Nicos Anastasiades is expected to have successive meetings with economy stakeholders and social partners on 21 April at the Presidential Palace. According to an official announcement, Anastasiades will chair a meeting with the Cyprus Chamber of Commerce and Industry (CCCI), Employers and Industrialists Federation (OEV), trade unions SEK, PEO and DEOK, hoteliers’ association PASYXE, the Association of Cyprus Tourism Enterprises (ACTE), on matters relating to the economy. He will then chair a meeting with technical chamber ETEK, the land developers’ association and the large-scale developments association.



The coronavirus affects casinos and hotels in the occupied areas

The “President” of the “Turkish Cypriot Hoteliers Association” Dimağ Çağıner, expressed his concerns about the impact that the pandemic will have on the tourism sector in the occupied areas. He said that no tourists are expected during the Ramadan period given that Turkish Airlines have suspended all outbound flights until 20 May. Even if flights resume on 20 May, there is no way tourists will come to the occupied areas from Turkey. “We expect partial tourism traffic in July”, he said. The tourism sector, like all other aspects of the economy, is facing great challenges, and even if Turkey resumes flights to various European countries, it will still take a long time before the situation is smoothed out. He said that hotels and casinos will be affected the most.

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