THE GOVERNOR of the Central Bank Panicos Demetriades has learnt one thing from the man, who appointed him – avoiding taking responsibility for his actions and decisions. This was evident, not for the first time, in the statement issued by the Central Bank yesterday in response to a letter from PIMCO to the Governor, published by Politis.

The letter, which was a point for point reply to an earlier letter by Demtriades, complaining about the methodology and assumptions used by PIMCO in calculating the recapitalisation requirements of the banks, clearly states that “assumptions that have been described as PIMCO inputs in your letter were, in fact, direct inputs from the Steering Committee (SC).” 

The decisive role played by the SC in determining the modelling approach, methodology and assumptions is repeatedly mentioned in the letter. For instance, “the assumption for the decline in home prices during the forecast period was an explicit assumption provided by Steering Committee,” it said. PIMCO’s “modelling approach has been the subject of a thorough and lengthy peer review by the SC.”

Yesterday’s statement by the Central Bank presented Demetriades as just an observer, who had nothing to do with the inputs of the SC. “The Central Bank, as is well-known, maintains its own views regarding the methodology and assumptions used by PIMCO,” said the statement, giving the impression it had no say, despite being represented on the SC. 

Of course, the Governor chose not to sit on the SC and nor did his right-hand-man, the newly-appointed Deputy Governor. The Central Bank was represented by a technocrat, because the Governor was way too busy to waste his time attending meetings of the SC which decided the assumptions and methodology that would determine the re-capitalisation figure PIMCO would arrive at. That the assumptions and methodology agreed by the SC, would inflate the recapitalisation figure by a few extra billions, did not bother the Governor.

In his original letter he had conveyed the banks’ “extreme disappointment with PIMCO’s work, a fact that could not have been ignored by the Central Bank.” Again, the Governor acts like a disinterested third party, who we were informed by yesterday’s statement, arranged a meeting between representatives of the banks and PIMCO and then conveyed the complaints of the former to the latter. 

He had no responsibility for anything. Yesterday’s statement listed the organisations represented on the SC – it was not the first Central Bank statement to do this – in order to remind us that the Central Bank was just one of many representatives and therefore unable to influence the committee’s decision. Maybe this was the case, but a Governor with a sense of duty and a commitment to protecting the banking sector, would have at least sat on the committee and done his best to moderate the assumptions for PIMCO’s study.

Demetriades washed his hands of the procedure so he could avoid any responsibility for the high recapitalisation figure and put the blame on PIMCO and the Steering Committee. Perhaps we should not have expected anything more from a Christofias appointee.

CYPRUS faces a "material and rising risk" of defaulting on its sovereign debt, especially if the eurozone and International Monetary Fund do not come up with aid, rating agency Standard & Poor's said yesterday.

"We see at least a one-in-three chance that we could lower the Cyprus sovereign ratings again in 2013, for example if official financial assistance from the (European bailout fund) ESM and/or IMF is not forthcoming, leaving the Cypriot authorities few choices apart from to restructure its financial obligations," S&P's head of EMEA sovereign ratings Moritz Kraemer said in a report.

S&P's comments came as the island gears up for a run-off presidential election on Sunday pitting DISY chief Nicos Anastasiades, who is in favour of a swift bailout deal against the AKEL-backed Stavros Malas who supports a bailout but with fewer harsh austerity measures.

"We could also lower the ratings if we believe the (Cypriot) authorities are not able to fulfill the conditions that would be attached to an official assistance programme."

S&P currently rates Cyprus at CCC+, well into non-investment grade "junk" bond territory, with a negative outlook.

Cyprus asked for international aid eight months ago after its banks suffered huge losses on exposure to a restructuring of Greek sovereign debt and due to difficulties in accessing international capital markets shut to it because of fiscal slippage since mid-2011.

Cyprus could need an estimated €17.5 billion from the eurozone to recapitalise its banks and to finance the government over the next three years.

Though the final figure has not yet been agreed, as Cyprus appears to object the amount needed for bank recapitalisation – €10 billion, the EU and the IMF have expressed concern over the island’s debt burden after the bailout.

The IMF has reportedly asked for Cypriot banks to be recapitalised directly by the European Stability Mechanism and or a debt restructuring of either sovereign or bank debt. 

The idea of deposit haircuts has also been floated.

Financial services giant J.P. Morgan views the recent rhetoric as “mostly negotiation tactics.”

“The IMF wants to force a more pro-active commitment from the eurozone (it is also pushing for bank recap relief in Ireland), and both the IMF and eurozone want Cyprus to agree to more aggressive reforms and collateral commitments,” a J.P. Morgan report said earlier this month. “Similarly, the eurozone wants to ensure Russia’s participation in the bailout, given Russia’s deep economic ties to Cyprus. Policymakers can only reach these goals by raising the political heat.”

J.P. Morgan suggested that no one would be willing to risk the progress made in the eurozone’s periphery over the past few months, adding that there were enough market-friendly solutions to make Cypriot debt sustainable.

“Thus, our basecase expectation is that Cyprus and the troika reach agreement based on a combination of market-friendly measures including ledging of gas reserves, a privatisation programme and subordinate bank debt burden-sharing. We give our benign scenario 70 to 80 per cent probability,” it said.

The benefits of harsher options such as sovereign debt write-down or deposit haircut were modest relative to potential contagion risk and EU policymakers were likely to opt for the risk-averse solution, J.P. Morgan added. 

Standard & Poor's warns island is facing a 'material and rising' risk

Tests prove baby was stillborn 

THE 41-YEAR-OLD Bulgarian woman who was arrested on suspicion of killing her newborn, which was found wrapped in towels among rubbish at the Sotira farm, has had manslaughter charges dropped after tests confirmed her baby had been stillborn.

The woman had given birth in secret. An initial post mortem indicated the baby girl might have been born alive, leading to the woman’s arrest.  But according to police, tests carried out on Wednesday proved the baby was born dead. Police have dropped the charges for manslaughter but the woman is still charged with concealing the birth. It is against the law not to report a birth. The woman remains in hospital, under police supervision.

Drugs remand 

NICOSIA District Court has remanded two 20-year-olds and a 17-year-old for five days on drugs charges.

They were arrested on Wednesday after around 40 grammes of cannabis were seized by the drug squad, police said.

According to a police spokesman, members of the drug squad placed a car under surveillance in the Archangelos area of Nicosia in which two people were riding in. The passenger of the car allegedly approached another vehicle which was waiting at the scene to give the pair something. As soon as the driver of the car noticed the police he attempted to flee. The passenger, a 17-year-old, was checked and three grammes of cannabis were found on him while 24 grammes of cannabis were found in a plastic bag near the scene, police said.  The second vehicle, driven by a 20-year-old man was checked and six grammes of cannabis were found. His house was also checked where a further seven grammes of cannabis were discovered.

Jewellery stolen 

DIAMONDS valued at around €20,000 and other jewellery worth around €27,700 were stolen from a jeweller’s car, which was parked in a field in Limassol on Wednesday, police said. The 52-year-old jeweller reported to police that between 5.20pm and 7.30pm on Wednesday as his car was parked and locked someone broke the back window and took approximately €47,700 worth of jewellery which was in his bag.

Grenade attack 

A GRENADE went off in the early hours outside the offices of a company that delivers cleaning materials in Larnaca, police said. A spokesman said damage was caused to the front of the shop as well as to the office inside. Police are looking at the 35-year-old company owner’s professional past according to Larnaca police spokesman Christos Andreou. The damage caused by the grenade has yet to be estimated but Andreou revealed the offices were not insured.

Burglary and arson 

An English-Cypriot man’s house in Ayia Napa was set on fire yesterday at around 6am after it was broken into, police said. Famagusta Police spokesman Giorgos Economou said the house belongs to an English-Cypriot man who has been away since October. The fire was extinguished by members of the fire service. From initial investigations carried out at the scene, police have established the house was broken into from the back door, burgled and then set alight. The fire caused severe damage to the house although the amount has yet to be estimated. Economou revealed it is uncertain whether the house was insured. 

Teen shot by hunter 

A 16-YEAR-OLD from Pyrga was accidentally shot by an unknown hunter, as he was collecting wood with his father in Stavrovouni on Wednesday, police said. 

Larnaca Police spokesman Christos Andreou said the teen was struck by pellets and injured in various parts of his body. He was taken to Larnaca General Hospital where doctors said he had suffered damage to one eye. He was operated on and kept in for observation. His life is not in danger. “It would appear it is an accident but police are carrying out investigations to locate the unknown hunter who shot the young man,” Andreou said.

IN A bid to obtain more transparency from the board of telecommunications giant CyTA, unions PASE, SEP and ASET have kicked up a storm by publicising the board’s alleged proposal to build a football stadium. 

According to the general secretary of PASE, Alecos Tryfonides, CyTA’s board had talked about investing money from the organisation’s retirement fund to build a stadium. “I have it on good authority that at a meeting of the board, the possibility of using the workers’ retirement fund to build a football stadium was discussed,” he said. Tryfonides said a letter was sent to CyTA’s chief executive, Aristos Riris, asking him to intervene on behalf of the unions. The letter was also sent to the management committee of the pension fund and Committee on Development Plans and Public Expenditure Control as well as all the employees of CyTA.

“We do not need to explain to you, in this day and age such a move in the current market would not be an investment but a move to fulfil a political or personal agenda,” the letter said of the stadium idea.

Tryfonides said the letter was addressed to Riris and not the management committee because they had exhausted all methods of communications with them. 

“At the same time as legal proceedings are underway against them for a lack of transparency on the pension fund, the board has decided to go ahead and spend every last penny that is left,” it concluded.

Tryfonides said the unions have been waiting since March 2012 to receive a report on the statement of accounts, of investments and productivity levels from the pension fund but nothing has been forthcoming. “According to the law, a member of staff of CyTA must be on the management committee of the pension fund, comprising one third of it, but unfortunately that is not adhered to either,” he added.

But CyTA chairman Stathis Kittis has denied the claim calling them “completely false unfounded and despicable”.

In a written response to unions, Kittis said such a move was not even being looked at.

“The claims are misleading and you (trade unions) are spreading false information before even asking to be informed if any such scenario was examined,” Kittis said. 

“I am calling on you act seriously because with your actions it is evident that you are turning on members of the board for ulterior motives and risking burning down the house you and your colleagues live in,” he concluded.

The team, which stands to benefit if a new stadium was built was revealed to be AEL Limassol.

PLANS are underway for luxury hotels and residences in the ‘Karpaz Gate Marina’ a massive development near the occupied village of Yialousa in the Karpas peninsula, the project’s representative Liza Singer has said. 

The complex is on 270 donums (one donum is about 1,337 square metres) of mostly Greek Cypriot land and is funded by the low-profile British family business, Lewis Trust Group (LTG). LTG is an investment company that operates retail stores including youth-oriented River Island, real estate, and hotels. 

The marina has been open to yachters since June 2011, but there are plans for a four and a five-star hotel, two spas, a conference centre, a casino and a number of bars and restaurants.

Turkish daily Milliyet quoted Singer as saying the investment was worth about €300 million. “This is the first direct foreign investment made in the ‘TRNC’,” Singer said. 

Singer previously told the Cyprus Mail that political issues were “beyond and above (LTG) but added they believed they were “contributing to a solution, not the other way round,” by developing the area “for the island as a whole”.

In 2004, the Cyprus Mail’s Simon Bahceli was introduced to a Turkish Cypriot businesswoman, Sidika Atalay, who along with Asil Nadir (now jailed in the UK for fraud) had drafted a plan for the marina. Soon afterwards, Atalay sold the project for a rumoured 10 million dollars to the LTG head, the late David Lewis. 

Circa 2006 when LTG started taking quiet steps in relation to the project, the Greek Cypriot community in the UK lobbied against the plans. The foreign ministry has also been taking steps with the relevant authorities, a foreign ministry official said.

The 2009 Orams case has set a legal precedent for individual legal action after a Greek Cypriot successfully sued a British couple, Linda and David Orams, for using his property in the occupied north. A British court ordered the couple to demolish the home they built on his land, return the property and pay back rent and legal costs. The house is still standing, though this leaves the Orams vulnerable to further legal action. 

The marina’s website www.karpazbay.com is silent on politics. Visitors are told that two international airports “are adjacent to the resort” with “transport available upon request”.

The airports are the one in Larnaca and Tymbou (Ercan) that is in fact, not recognised as an international airport because direct flights to the north violate the international civil aviation convention. 

The marina offers 300 berths with space for maintenance and storage. A luxurious restaurant and a beach club are already open for business, and a diving school has set up shop in the area.

'Karpaz Gate Marina' a massive development near the occupied village of Yialousa in the Karpas peninsula

STAVROS Malas’ electoral campaign theme may be “new face, new plan, new era” but his campaign team’s methods appear to be outdated and not exactly blunder-proof.

The AKEL-backed candidate’s camp accidently faxed out a partial list of names indicating the voting positions of those on the list, their work status and place of residence.

When someone realised their mistake they put a stop to the faxing but not before six names had been released.

The document described one person on the list thus: “Will not go to vote, (and is) unemployed and angry”. Another: “Voted for (EDEK-backed Giorgos) Lillikas in the first round”. A third: “(would) not vote”.

Rivals DISY wasted no time in making fun of the blunder.

Nicos Anastasiades’ spokesman Tasos Mitsopoulos promptly issued a mocking statement saying instead of mudslinging against the DISY candidate, “it might be more useful if (AKEL) became better acquainted with new technology”. 

The head of Malas’ campaign, Takis Hadjigeorgiou, would not answer his mobile phone. 

Back in August last year, the government accidentally sent out a list of previous board members of semi-governmental organisations, along with political party affiliation and comments. 

Comments included “positive,” “negative” and “supportive” while one board member was identified as an AKEL supporter who follows the party when needed. Another member was described as “cooperating”. 

The list was accidentally sent – in apparent technical error - after Cabinet appointed new boards and the names of the new members were released to reporters.

NICOS Anastasiades’ presidential candidacy yesterday got another endorsement, albeit this time from a non-secular – yet highly political – source.

Archbishop Chrysostomos publicly lent his support to Anastasiades following a meeting with the DISY leader.

“The country needs a strong government, and we shall stand by the government and Mr. Anastasiades,” the prelate told newsmen.

The top cleric went on to wish Anastasiades success, even addressing him as “Mr. President.”

Responding to questions, Chrysostomos dismissed the notion that as, a religious leader, he should not meddle in politics.

Under “normal” political conditions, he said, the Church would do best to restrict itself to ecclesiastical matters.

But, he argued, due to the Turkish occupation, and the fact that many people are suffering in the economic squeeze, “the Church cannot keep its mouth shut.”

AKEL meanwhile did not deign to comment on the Archbishop’s choice.

“The answer is no comment,” party spokesman Giorgos Loucaides said. “Let the people judge the Archbishop.”

Anastasiades has already secured the backing of the European Party, which acquired 3.88 per cent in the May 2011 legislative elections. However, the party is reportedly split over the decision.

Meanwhile the two rival camps continued trading barbs yesterday. AKEL leader Andros Kyprianou rejected claims that their candidate Stavros Malas would continue the policies of the current government.

“He has no organic relationship to AKEL whatsoever,” Kyprianou said of Malas, who for 18 months served in the Cabinet of the Christofias administration.

The Anastasiades camp had a sardonic response:

“With all due respect to Mr. Kyprianou, listening to him reminds me of the likeable Pinocchio,” spokesman Tasos Mitsopoulos said.

Meanwhile as anticipated, socialists EDEK yesterday elected to support neither of the two remaining contenders in the runoff ballot this Sunday.

The party clarified that it was not calling on supporters to cast a conscience vote, nor to abstain from voting.

Rather, it’s understood they want their people to go to polling stations and to cast a blank or invalid ballot.

In the 2011 parliamentary elections, EDEK (then called the ‘Movement for Social Democracy’) garnered around 9 per cent of the popular vote. 

The party had backed independent Giorgos Lillikas in the first round of these elections.

Also yesterday the United Democrats decided to instruct their supporters to vote by conscience. The party’s candidate Praxoulla Antoniadou received 0.61 per cent of the vote in the first round of voting last Sunday.

A 35-YEAR-OLD woman was yesterday remanded in police custody on suspicion of being involved in last week’s abduction of 18-month-old Stavros Styllis.

The woman, the toddler’s aunt (she is married to his father’s brother) is the subject of an ongoing investigation into child abduction and exposure, and conspiracy to commit a felony. A Limassol court yesterday ordered that she be remanded for seven days.

The woman is the prime suspect in the case; based on forensic evidence, authorities believe she was working with accomplices. Police say that so far she is not cooperating; the woman denies any involvement.

In his affidavit to the court yesterday, the boy’s father revealed his sister-in-law was the only member of the family he did not get along with and he had constantly argued with her since 2003 when she married his brother.

He also claimed that after the birth of Stavros and his twin sister he received messages from a withheld phone number threatening to harm his children. 

A police spokesman said that CCTV footage and phone records indicated the woman’s car was in the area of the abduction at the time of the incident. Forensic evidence taken from her car, a blue jeep, was confirmed to be that of little Stavros. According to reports, after searching the car, police found traces of DNA from two other people whose identity has yet to be established.

The woman had been detained and interrogated on Friday, the day of the abduction, but was later released because at the time there was no hard evidence linking her to the crime.

Subsequently, however, police got access to CCTV footage from a shop located near the house of the toddler’s grandmother, from where the boy was snatched. The video revealed a car resembling that belonging to the 35-year-old suspect. Forensic analysis of the car later revealed traces of the boy’s DNA on the back seat.

The woman was arrested on Wednesday but again denied taking the child.

The boy’s disappearance last Friday had sparked a massive search, mounted by Cypriot police, a police helicopter, British bases police, the National Guard and Civil Defence, Ypsonas municipal workers, and members of the public.

The publicity given to the disappearance eventually led to the boy’s accidental discovery at a cemetery on the afternoon of the same day.

A widow who visited Ypsonas cemetery to light a candle for her husband found the little boy crying outside a shed, eight hours after he had been taken.

It has also been revealed that, in an incident in December, little Stavros had almost eaten some pudding containing broken glass and other harmful substances but police ruled out any link between the two incidents.

CYPRUS' debt crisis risks spreading to other eurozone countries, the head of the eurozone's bailout fund said in a newspaper interview, urging a rapid decision on aid for the island.

With Italy facing elections in the coming days, it represents a source of uncertainty although the eurozone has the means to cover its borrowing needs, Klaus Regling said in an interview with French daily Le Figaro.

Eurozone finance ministers have put off thrashing out an international bailout for Cyprus until next month ahead of a presidential election which culminates with a runoff on Sunday.

Cyprus needs a bailout of around €17 billion -- almost the size of its gross domestic product -- mainly because of the devastating effect the sovereign Greek debt restructuring had on the oversized Cypriot banking sector.

"We need a decision soon or otherwise it represents a risk for the eurozone," Regling, the head of the European Stability Mechanism, said.

Rating agency Standard & Poor's said on Wednesday Cyprus faces a "material and rising risk" of defaulting on its sovereign debt, especially if the eurozone and International Monetary Fund do not come up with aid.

Thomas Wieser, who heads the Eurogroup Working Group, a group of senior officials who prepare decisions of eurozone finance ministers, said late on Wednesday  while no details of a Cyprus bailout were decided yet, he believed the island’s debt could be made sustainable without a sovereign debt restructuring or forcing bank depositors to take losses.

"I still believe that in the second half of March, probably towards the end of the second half of March, a decision should easily be possible," Wieser told Reuters on sideline of a conference in the Slovak capital Bratislava.

Wieser said the package would need to seek fiscal discipline, structural reforms, a boost to the economy's competitiveness, wide-ranging privatisation and a shrinking of the banking sector, which he said was five to eight times the size of the country's gross domestic product.

To help meet its financing costs, Cyprus has already taken a €2.5-billion loan from Russia, which has built close ties to the island of one million people.

When asked about a possibility of selling Cypriot banks to Russia, Wieser said there were currently no such talks.

"Would this be considered feasible? I would say it is a distinct possibility," Wieser said.

"If owners of a Cyprus bank were to receive an offer I'm sure the owners would consider this carefully. I would believe that this would receive at least a feasible consideration (by euro area officials)," Wieser said.

APPARENTLY acting at the behest of the Presidential Palace, semi-government organisations (SGOs) have snubbed authorities’ request to furnish details of their assets and financial accounts.

The memorandum of understanding (MoU) agreed between the government and international lenders – the troika – specifically provides for a stock-taking of state-owned enterprises, in order to consider the possibility of privatising them to raise cash.

Local media yesterday suggested the mere request for information had laid bare the AKEL government’s insistence that it would not touch SGOs despite pressure from international lenders. However, the same outlets suggested the move was initiated by the finance ministry, but quickly quashed by the President.

Right-leaning Alithia published a confidential letter from the finance ministry’s permanent secretary addressed to the Department of Lands and Surveys, requesting the latter to provide a list of the assets – including real estate – of state-owned enterprises.

The ministry asked that real estate prices be quoted in both 1980s and current prices. The letter said the request was pursuant to the relevant article in the MoU agreed with the troika.

The data requested concerned the Cyprus Telecommunications Authority, the Electricity Authority, the Ports Authority, the Cyprus Sports Organisation, the State Fairs Authority and the Cyprus Broadcasting Authority.

Dated January 31, the letter urged the department to furnish the data “as soon as possible.” It also references an earlier circular issued on the same subject and dated December 27, 2012.

Alithia also published the written response of the Ports Authority, signed by its head Chrysis Prentzas. He flat-out refused to give the data, citing the organisation’s disagreement with plans to privatise SGOs.

The Memorandum of Understanding on Specific Economic Policy Conditionality (chapter 3, article 3.6) states that Cypriot authorities will “establish an inventory of assets, including real estate, owned by central government, municipalities and regional administrations, in view of possible divestments or restructurings.

“To this end, the inventory will indicate which State-Owned Enterprises could be subject to divestment, which could be subject to restructuring and which could be considered for liquidation [Q3-2013].”

The next article notes that “if necessary to restore debt sustainability, the Cyprus authorities will consider a privatisation programme for state-owned and semi-public companies.”

This has turned into a highly charged political issue since the publication of the MoU. The opposition accuses the AKEL government of having given the green light for the possibility of privatisating SGOs; the administration counters that this is not written in stone and would occur only in the extreme scenario that the island’s debt is deemed unsustainable by international lenders.

According to Alithia, the rest of the SGOs simply chose to ignore the finance ministry’s request, ostensibly on instructions from the Presidential Palace, which mobilised to put to a stop to the exercise.

That in turn has led to media speculation that the finance ministry and the President are at odds over complying with the MoU to the letter.

Daily Politis ran a similar story; it published a letter by the accountant-general to the CEO of the Cyprus Telecommunications Authority (CyTA).

The letter (January 24) is titled: “Re: Promoting the implementation of the Memorandum of Understanding.” In it, the accountant-general asks CyTA to provide its audited financial accounts for 2009 through 2011, projections of revenue streams over the next two years, a list of assets (including values), and “an assessment of the impact of the measures provided in the memorandum on the organisation’s operations” such as profitability and efficiency.

The data was requested to be forwarded by February 1.

The paper contacted government spokesman Stefanos Stefanou, who said the above letter was sent out unbeknownst to the Presidential Palace – lending weight to suspicions of conflicting agendas between the President’s inner circle and the finance ministry.

Politis also revealed a letter, dated February 19, sent from the Ministry of Commerce to CyTA, the EAC, and the State Fairs Authority – SGOs under the ministry’s responsibility.

It read: “On the instructions of the Commerce Minister, we hereby inform you that the meetings in question will not take place.” It refers to meetings with representatives of the troika that had been scheduled for yesterday and today.

It’s understood that, at these meetings, the troika and Cypriot authorities would have reviewed the data collected on the SGOs.

The commerce ministry’s letter gave no explanation for the cancellation of the meetings.

Politis said also that, other than the EAC, none of the other SGOs complied with authorities’ request.

The EAC declined comment yesterday, except to confirm receipt of the Finance Ministry letter. CyTA CEO Aristos Riris likewise confirmed the organisation had received the same letter.

But he dismissed the notion that the telecoms utility has refused to cooperate.

“We are still considering the request,” he told the Mail, despite acknowledging that the deadline for furnishing the information had passed.

The finance ministry could not be reached for comment.

CAMPAIGNING in the last week has turned nastier with rival camps laying into the opponent’s supposed weaknesses and inadequacies. This is expected in the last few days before the final round of the elections. What was not expected was the apoplectic reaction of the Stavros Malas camp to an Anastasiades newspaper advert that was published on Wednesday and focused on the appalling record of five years of the Christofias government. 

AKEL deputies all raged against the advert, which could have been classed as negative advertising, but did not say anything that was untrue. The ad listed Mari, record unemployment, the closing down of businesses, 200,000 people living below the poverty line, isolation in Europe and several other negative achievements of the AKEL government before asking whether people could take another five years of the same. 

DISY was accused in engaging in ‘black propaganda’ by one AKEL deputy after the other, the implication being that ‘white propaganda’ which is the communist preference was perfectly acceptable by comparison. “They opt for fanaticism and brutal distortion of the truth,” said AKEL deputy Giorgos Loucaides on Wednesday, lamenting the emergence of these “antiquated practices that hailed back to dark periods.” The Anastasiades camp was turning the clock back to the 1950s and ‘60s and cultivating fanaticism, pontificated communist deputy Nicos Katsourides.

AKEL’s hypocrisy is beyond the pale. Two days before the advert was published, the AKEL spokesmen of the so-called independent candidate Malas, had embarked on an unrelenting, negative campaign against Anastasiades. This was not done with newspaper adverts but through public statements by AKEL deputies, including the above-mentioned pair, who claimed that if Anastasiades was elected he would privatise all state companies, cause thousands of job losses, scrap CoLA and 13th salaries, restrict union activities, reduce the minimum wage to €500 per month and a host of other alarmist lies.

Was this scare-mongering white propaganda and therefore acceptable? Was this white propaganda not aimed at cultivating fanaticism and class war conditions? At least DISY’s black propaganda was based on factual reality in stark contrast to AKEL’s white propaganda that was based on imaginary scenarios. Surely if AKEL has the right to warn people against voting for Anastasiades because of the terrible things that would happen to them, DISY has the right to do exactly the same, in relation to Malas.

DISY was absolutely right to hit back. Anastasiades could not sit back and allow AKEL to claim he would impose austerity measures and pay cuts, when these had already been imposed by the AKEL government which also bankrupted the country. Voters have a right to know the facts even if these are described as black propaganda and negative campaigning.

COURT bailiffs armed with a warrant issued in connection with unpaid state debts attempted to seize a ministerial car outside the finance ministry yesterday but were prevented by the car’s driver, a policeman, who drove the car into the basement parking and out of reach. 

The bailiffs reported the officer to the police for obstructing efforts to execute a court-approved seizure warrant. The Attorney-general, who incidentally gets to decide on state prosecutions, argued the attempted seizure was wrong and unfair.  

This is the second time in a week that bailiffs attempted to seize moveable property of the state in connection with money owed by the state over a specific €5m-worth land expropriation.

According to Attorney-general Petros Clerides, earlier this week and armed with the same seizure warrant, bailiffs attempted to seize the property of the Accountant-General but were stopped after Clerides’ intervention. 

Yesterday’s bizarre scenes unfolded before media crews and were quickly posted on the internet for public viewing. 

Media crews were waiting outside, documenting events, as the bailiffs first entered the ministry’s basement parking, recording the registration plates of six luxury state-owned cars, which they planned to seize in lieu of the unpaid debt. 

The ministry’s permanent secretary told them they would not be allowed to take the cars so the bailiffs took a pick-up truck and parked it at the exit point of the basement parking, while they stood at the entry point, waiting to seize any state car going in or out of the building.   

When Commerce Minister Neoclis Sylikiotis unknowingly made his way in his ministerial car to the finance ministry for a meeting, bailiffs flagged down the car and asked the driver to hand over the keys. 

A verbal altercation followed between the driver and the bailiffs. At one point Sylikiotis joined in the fray, giving one of the bailiffs a gentle shove while encouraging him to cease and desist. 

The bailiffs insisted on taking the car at which point the minister reminded them that his driver was a police officer. 

“It doesn’t matter what he is Mr Minister,” said the bailiff, turning to the other and shouting, “Get the pick-up truck.”  

Sylikiotis muttered something along the lines of what was going on and why were  the cameras rolling, after which he made his way to the ministry, leaving behind his driver who took the opportunity to drive the car away from the bailiffs and safely into the gated parking of the basement. 

The bailiffs had arrived at the ministry in the morning armed with a warrant related to a €5m debt owed to a Nicosia landowner whose land was initially expropriated by the state for CY £600,000  for the purposes of building a school.

According to Clerides, when the state failed to make use of the land three years after its expropriation, the original owner applied to have the property returned to him. The state obliged and the £600,000 was also given back. 

At a later stage, the state expropriated the land again for the same purposes. The state and buyer did not reach agreement on the new price, however, and when the court ordered the state to pay up €5m, the state appealed. 

That appeal is still pending. In the meantime, as part of recent efforts by the interior ministry to save public money, the state revoked the expropriation in September 2012. 

The owner insists, however, on getting the €5m regardless and applied to court for a seizure warrant to get his money. The Nicosia court obliged and the warrant was issued. 

“The Republic applied to rescind the seizure warrant since an appeal was pending and the expropriation had been revoked. The Republic’s demand was rejected by the district court,” said Clerides. 

“The Republic then applied for a stay of execution against the seizure warrant, the hearing of which is set for February 28,” said the AG.

Clerides questioned why this specific landowner insisted on executing the warrant since an appeal was pending and the land had been given back by the state. Instead, he could sue for compensation for loss of use or rent of the land while it was under state ownership, hinted the state’s top lawyer. 

“For what purpose should the state pay the €5m that in my opinion it does not owe since the expropriation has been revoked and an appeal against the court’s ruling is still pending?” he asked. 

Clerides bemoaned the fact that, with state coffers all but empty, the state’s creditors were going to such lengths as to pull a minister out of his car to execute court-issued warrants. 

“Why didn’t they begin execution of the warrant at the offices of the court registrar and the judges? If they want to execute warrants, the easiest way would be to start with the state’s property at the courts,” he said. 

For the government, the latest reminder of the country’s near bankruptcy was seen not so much as a stroke of bad luck in its twilight hours but more of an election conspiracy orchestrated by the presidential campaign team of DISY leader Nicos Anastasiades.   

Government spokesman Stefanos Stefanou and AKEL questioned why this issue happened to come up three days before the second round of presidential elections.  

AKEL spokesman Giorgos Loucaides went as far as to call it a shameful “provocation against the state and its institutions”. 

DISY responded that it truly was shameful to see such humiliating events unfold while watching the government try to shift the blame on to Anastasiades. 

Meanwhile, providing a further headache for the AG, according to reports, the Paphos district court has decided to go ahead with an auction next Thursday to sell off seven state-owned cars following another court-issued warrant related to money owed by the state for land expropriations.

The cars were seized last October and were prevented by Clerides from being sold in the court’s parking lot  after the AG made a last minute intervention last month. 

However, it appears the court has lost patience and will go ahead with the auction on February 28. 

The state owes some €570m to owners of land expropriated for the purposes of implementing public projects, including the Paphos-Polis highway and the Pentakomo Technological Park. 

In September, 2012, the government decided to revoke land expropriations for public projects deemed superfluous worth a total of €160m.

Commerce Minister Neoclis Sylikiotis (left) argues with a bailiff who has just told the minister's driver to hand over the keys of his car outside the finance ministry yesterday morning

FORMER policeman, 62-year-old Nikos Iordanous yesterday pleaded not guilty to the charge of the premeditated murder of his 56-year-old wife Stavroula Iordanous on December 10, 2012. 

The hearing for the case was set for May 23 by the Criminal Court which convened yesterday in Larnaca. Iordanous is accused of shooting his wife with a shotgun in the apartment in Aradippou where they lived.

According to reports, before the start of proceedings, as Iordanous entered the courtroom he was attacked by members of the victim’s family. Police were forced to remove him from the room for a short period. 

As Iordanous pleaded not guilty, one of his wife’s relatives shouted out ‘liar’. This forced the Judge, Pambos Poyadji to demand order in the court.

Iordanous was later verbally abused by the victim’s sister on exiting the courtroom as he was escorted out by police. He will be kept in custody until the hearing on May 23. 

Stavroula Iordanous was found dead in their apartment on the evening of December 10. Neighbours had heard a single shot and called the police.

She was found lying dead on a couch, with a gunshot wound to the head; a shotgun was found next to her body.

Police had said her husband was in shock at the time, claiming his wife had shot herself. During questioning the next day, police said they found inconsistencies in his account and deemed him the prime suspect.

Police said the crime scene and in particular the positioning of the gun did not point to suicide. The couple were also said to have had “differences,” according to the police.

INTRODUCING civil partnerships will create social problems and encourage the breakdown of marriages, the Association for Confronting Social Problems (SAKOP) has said, criticising the Cabinet’s recent draft bill which they say was not the result of social dialogue. 

The Cabinet recently passed a draft bill to enable couples to have a legally recognised relationship outside of marriage.  A civil partnership allows a couple, living together but not married, to register their relationship with authorities so they can have the same obligations and rights as married couples.

SAKOP said that “without a doubt” many social problems would be created because there was no procedure holding the partnership together, “just as in the case of religious or civil marriage where the process of divorce is in place”. 

The organisation said the actual process of divorce could often save a marriage and prevent psychological and social problems because there were mechanisms in place to prevent a break-up and enable couples to have a “smooth cohabitation”.

“(With civil partnership) there will be a constant change of partners with many consequences,” SAKOP said, adding that it would lead to an increase in break-ups and problems. SAKOP did not cite any research justifying these claims though they also said that partnerships would encourage married couples to “destroy their marriage and repetitively change partners”.

Married couples may or may not divorce for reasons that are not related to civil partnerships, said sociologist and psychologist Antonis Raftis.

He added that some of the couples who visit him in his office already legally regulate their relationship even outside of marriage, e.g. by signing a contract on mutual property.

“I don’t think a civil partnership will encourage couples to divorce any more than they do now. If there is an increase in divorces we should look (for the reasons) elsewhere” Raftis said.

The rate of divorce has risen to 307 per 1,000 marriages in 2011, from 42 per 1,000 in 1980, according to statistical services’ 2010-2011 demographic report. 

And couples in Cyprus are increasingly choosing to have children without getting married.

A total of 16.9 per cent of all births are out of wedlock, one of the lowest proportions of extra-marital births in Europe but already an increase since 2009 when 11.7 per cent of births in Cyprus were out of wedlock. 

Raftis said the institution of marriage was enduring and people did not divorce lightly when they had children to consider, but he added: “It is better to divorce than to stay in a dead marriage”.

There can be social and psychological problems associated with divorce but children are also vulnerable to insecurity from experiencing a marriage that has effectively broken down and where partners may have extra-marital relationships, he said. 

SAKOP said that under the new rules, “straight and gay couples will be able to live together and if, and when they decide to break up their cohabitation they will not need to undergo divorce, they will simply say “hello, the partnership is off” and each will go their way”.

However, it is not clear how easy or difficult it will be for couples to annul a civil partnership in Cyprus if and when a law is passed. The European Commission says on its website that “differences between EU countries in this field are huge, in terms of not only the possibilities they offer but also (in terms of) the extent to which partnerships contracted abroad are recognised (if at all).”

In the UK, the government advises couples that the court forms used to annul a civil partnership are the same as in the case of annulling a marriage. 

The legal services are due to process and approve the draft bill before parliament starts discussing it. 

OVER 400 plates of hot food donated by local restaurants were handed out to families in Paphos on Thursday.

The initiative was organised by a local priest Father Stylianos Sofokleous, who is also trying to establish a soup kitchen for the district, in conjunction with a group of local volunteers who have now officially registered as a charity with the name ‘Solidarity’.

Pavlina Patsalou who heads up the group along with Paphos councillor George Sofokleous, have been feeding hundreds of Paphos families for the last 18 months. They started with 20 families, which grew to 250 and now numbers are in excess of 400.

Patsalou said the priest approached the group with the offer of help.

“We have now moved our operation to a three bedroom house close to my shop, which has been donated by my landlord. We are offering the food support out of these premises and on Thursday, for the first time Father Stylianou offered 400 plates of hot food,” she said.

Ongoing fundraising events are raising money, food and clothes to help the families who are not officially entitled to assistance as they fall outside municipal boundaries.

The appeal has also brought forward a medical doctor, Dr Dorel Dimcea,  who is now offering his services free to the genuinely needy.

A coffee morning held at Tommy Tuckers restaurant in Paphos last weekend raised €424 as well as clothes, food and blankets.

Local website designer Phillipa Demitriades has offered her services free and is now in the process of setting up an official dedicated website.

In addition, Justin Devonshire and Jason Smith of Bodyshape Fitness will be hosting charity fitness workouts to raise funds every Saturday morning. The first ‘Bodyshape Giving Programme’ will be held today at 9am at the pairs’ studio- found above Famous Sports shop near the general hospital roundabout.

Devonshire said: “To take part in the workout, we’re asking people to donate food, blankets, unwanted clothes and toys.”

Paul Clarke aka Cycling Cyprus, will ride on static bikes outside Kolios butchery and delicatessen in Paphos at 9am today to encourage shoppers to donate food.

Another upcoming event has been organised by volunteer Ali Fudge- called ‘Together we can', which will take place at DT's bar on the Tomb of the Kings road on Saturday March 2nd 4-8pm.Live DJ, happy hour, raffle and more. For more info contact Ali Fudge- 99377321.

Patsalou said the group was also concerned that one of Paphos' main supermarkets was about to close and would mean many more in need of urgent help. “There just isn’t enough money to go around from the government services, so people are turning to us in desperation,” she said. “We have just had another ten families ask us for help…all of them were Cypriot. It’s very worrying”.

Contact Pavlina Patsalou at 99-22-01-52 or George Sofokleous at 99-54-23-43

Information and events listed at Aphrodites Angels Paphos- facebook page

Dr Dorel Dimcea: www.drdimcea.com

Charity fitness workout bodyshapebootcamp@gmail.com or at 966 588 13

Father Stylianos Sofokleous - (Greek speakers only) at 96671440. English speakers should call Socrates at 99371183

PUBLIC health and veterinary services are taking a close look at the books of an international company based in Paphos and Limassol after a report was received that they had imported horsemeat. 

According to head of the veterinary services, Giorgos Kyriakides, a complaint was received on Thursday afternoon regarding a company in Paphos which had imported frozen ready-meals, which allegedly contained horsemeat.

“We will look closely at the company’s invoices while health services carry out checks on the food labelling and content,” Kyriakides said. “The food that might be contaminated with horsemeat is in precooked meals like lasagne,” he added.

Kyriakides said local managers of the company claimed they had no knowledge of any horsemeat imports or foods containing horsemeat. 

He went on to say that data which was published in The Guardian on Wednesday was false. The paper quoted Eurostat, claiming a total of 291,800 kilos of equine meat arrived in Cyprus in 2012 from Belgium, France, Spain and Greece.

“The information Eurostat has received was wrong,” he said. “Through an investigation we have confirmed that a total of 132 kilos of horsemeat was imported in 2012 by a restaurant,” he added. “It is most likely high quality meat, costing €15 a kilo and not just mixed in with processed beef,” he continued. “We are trying to find who imported it as it was not declared to the authorities, probably resulting in a fine for the company once they are located,” he concluded.

Acting director for public health services, Christos Christou revealed that officials from the health services were currently in Paphos and Limassol taking an inventory of all of the products said to contain beef. 

“The local manager of the company has agreed to withdraw all of those products, despite their being no proof, until an investigation has been carried out to ascertain whether they contain horsemeat or not,” he said. 

Christou added that the heads of the company in England, Ireland and France had been contacted and asked to provide documentation from the factories where the meals were made to prove that horsemeat was not used in the production process. “Unfortunately the health services cannot take samples to check for ourselves and we are dependent on third parties to give us evidence,” Christou explained. “Once we find out the results of the investigations we will proceed accordingly,” he concluded.

THE Supreme Court yesterday censured the island’s attorney-general over comments he made concerning an attempt to seize a ministerial car -- in public -- for an unpaid state debt.

In one of the rare times it has done so, the Supreme Court issued an announcement describing Petros Clerides’ comments as inappropriate, out of place, and unfortunate under the circumstances.

The island’s top lawyer responded almost immediately, saying it was the Supreme Court’s announcement that was inappropriate and out of place.

The announcement came after bailiffs on Thursday tried to execute a court-issued warrant to seize moveable state property in connection with money owed in a land appropriation case worth €5.0 million.

Amid a media circus, the bailiffs tried to seize the commerce minister’s car causing an embarrassing scene for the government.

Clerides said there was no reason for such an action – an appeal is pending -- and wondered why the bailiffs had not gone after property belonging to courts and judges.

The Supreme Court said the bailiffs were doing their duty and criticised Clerides.

“The tone and content of the attorney-general's comments to the mass media … are considered inappropriate, completely out of place and unfortunate, to say the least,” the Court said.

Clerides returned the fire, saying it was “sad for the Supreme Court to issue such announcements.”

“I think it should be the opposite,” he told a state broadcaster lunchtime news show by phone. “The court’s announcement is inappropriate, completely out of place and unfortunate.”

In its announcement, the Supreme Court also criticised the fact that the attempt to seize the vehicles was done in front of the media.

It also listed the events that led to the action.

The incident, three days before the presidential election, sparked a war of words between the government and the opposition.

Interior Minister Eleni Mavrou claimed that the appropriation in question concerned people who were “very close to the opposition” – a charge rejected by DISY leader Nicos Anastasiades.

“We have no need of such phenomena to promote our candidacy,” Anastasiades said. “These are phenomena that happened repeatedly in the past year as a result of the state’s inadequacy – its weakness to meet its obligations.”

Last October, bailiffs seized seven state vehicles following another court order issue in connection with money owed for land expropriations.

They are expected to be auctioned off at the end of this month.

The state owes some €570m to owners of land expropriated for the purposes of implementing public projects, including the Paphos-Polis highway and the Pentakomo Technological Park. 

In September, 2012, the government decided to revoke land expropriations for public projects deemed superfluous worth a total of €160m.

THE EUROPEAN Commission yesterday slashed its economic outlook for cash-starved Cyprus, doubling its recession forecast  for the cash-starved island.

The island will see its €17.9 billion economy contract by 3.5 per cent this year, the Commission said in its winter economic forecast. The previous autumn forecast released in November had output contracting by 1.7 per cent in 2013.

"Risks remain important and tilted to the downside," the Commission said. Conclusion of an adjustment programme would be of "paramount importance" in stabilising Cyprus' economy, it added.

The economy was expected to contract by a further 1.3 per cent in 2014.

 “Projections of the economic outlook for 2013 and 2014 point to a prolonged recession, due to further declines in domestic demand and investment activity,” the Commission said.

The report said the effects of much-needed consolidation measures, coupled with increasing unemployment, were likely to weigh strongly on household disposable income.

“On the back of banks deleveraging and the deceleration of credit growth, gross fixed capital formation is expected to decline further, with the growth rates of the construction activity remaining negative over the forecast horizon,” the Commission said.

Unemployment was set to worsen further in coming years to 13.7 per cent in 2013, and to 14.2 per cent in 2014.

The government deficit improved slightly despite the sizeable consolidation implemented in 2012, the Commission said.

Revenues stagnated due to less tax-rich growth, lower corporate profitability and deteriorating labour market conditions while expenditure reduction was lower than expected, in particular due to the increased number of early retirements and growing unemployment. 

In both 2013 and 2014, the deficit and structural deficit is set to decrease gradually thanks to the adopted consolidation measures.

Conclusion of an adjustment programme would be of "paramount importance" in stabilising Cyprus' economy, it added.

Cyprus applied for financial assistance in June 2012 and needs up to €17.5 billion to shore up a banking sector heavily exposed to Greece and to plug fiscal gaps.

But bailout talks have dragged on, complicated by debt sustainability concerns, German misgivings about the island's commitment to financial transparency and delayed by a presidential election this Sunday.

Out of pocket and shut out of markets since mid-2011, Cyprus has been increasingly relying on short-term expensive borrowing from domestic institutions until aid is released.

"The conclusion of a macro-economic adjustment programme would be of paramount importance in stabilising the economy, but risks would remain on both the external environment and the domestic front," the Commission said.

SUNDAY’s presidential election will be the most critical in the history of Cyprus, DISY leader Nicos Anastasiades said yesterday, as he urged people to rid the country of the AKEL administration that brought the island to the brink of bankruptcy.

“Cyprus cannot take another five years of (incumbent President Demetris) Christofias policy from politicians who served and defend it,” Anastasiades said.

The presidential frontrunner urged people to participate in tomorrow’s poll to usher in a much-needed new era.

“We must put an end to the uncertainty and insecurity and give Cyprus back its lost international credibility and standing in Europe,” Anastasiades said. “(We must) restore our lost dignity and pride with the broadest possible consensus.”

Anastasiades said the choices facing Cypriots were the continuation of a policy that brought Cyprus to the brink of bankruptcy, made 50,000 unemployed, and led thousands of small and medium businesses to shut down.

“With thousands of households living below the poverty line and vulnerable groups of the population suffering misery and humiliation because of the cuts in allowances,” Anastasiades said.

The other choice was to usher in a new era and turn the country into a modern state that would take care of its people.

“An effective state that will create opportunities for growth so that the new generation feels secure and vulnerable groups feel protected by a real social state,” the DISY chief said.

Anastasiades is tipped as the favourite to win tomorrow’s runoff vote after garnering 45.46 per cent of the vote in the first round last Sunday against 26.91 per cent of his opponent, AKEL-backed Stavros Malas.

Malas yesterday continued to court the people who voted for Giorgos Lillikas, who came in third with 25 per cent of the vote.

Malas promised to give those who voted for Lillikas a significant role and position if elected.

“Because we are united by basic principles, basic objectives, away from party pledges and plans,” he said. “Most of all, however, we are united by the concern and love for the country and its people.”

Malas reiterated his pledge for a coalition government if elected, adding that he needed the votes of those who supported Lillikas in the first round.

“It is a given that I will propose to these political forces, participation in the national coalition government,” he said. 

Socialists EDEK, which backed Lillikas in the first round, has already decided to sit on the fence in the runoff.

Lillikas, who was now trying to capitalise from his strong showing, reiterated yesterday that he would not support either candidate.

"I will not give a vote of confidence to anyone," he said. 

Lillikas, who had refused to meet either of the other candidates seeking to recruit his support, was critical of both camps for agreeing to bailout conditions he said could compromise Cypriot sovereignty.

He said he had deep differences with both. "I do not believe in artificial convergences of positions which cannot really be reconciled," he said.

THE FRONTRUNNER in Cyprus' presidential election runoff said he has been in touch with governments and unspecified funds for a bridge loan to ensure the island does not run out of cash before it secures an international bailout.

DISY leader Nicos Anastasiades, who polled over 45 per cent in last Sunday's first voting round and is the favourite to win tomorrow’s runoff, told Reuters various parties, including "governments and funds" which he did not identify, had been "sounded out" for a short-term loan.

The "one or two month" loan would not supplant a bailout for which Cyprus is in talks with the European Union and the International Monetary Fund, he said.

"This would be in order to complete the (bailout) loan agreement with some comfort, without the threat or the fear of collapse," Anastasiades told Reuters at his party offices.

"That means not to be under the dilemma of a deadline," he added.

The 66-year-old lawyer declined to say whom he had contacted. It was the first time a presidential candidate in Cyprus has disclosed talks to secure a loan ahead of a bailout rescue - talks which have dragged on for eight months.

"We would want a very short period to study the (bailout) terms, to see how we could avoid distortions without dealing with the pressure of the state going bankrupt," said Anastasiades, who faces AKEL-backed leftist rival Stavros Malas  tomorrow.

Malas lags Anastasiades by 18 points in opinion polls.

A Socialist party that endorsed a third candidate in the first round has not backed either candidate, boosting hopes for the conservative chief known for his no-nonsense manner.

With Cyprus shut out of financial markets for almost two years, its outgoing leftist government has relied on short term and costly financing for months to meet its day-to-day needs.

Investors are closely watching bailout discussions amid fears continued delays in clinching a deal could hurt confidence in the eurozone just as fears of a Greek exit fade.

Cyprus' attempts to secure international aid have been bedevilled by concerns that the island is unlikely to be able to pay back a loan that dwarfs the size of its economy.

Anastasiades said recently speculated options to make debt manageable - from a sovereign debt writedown to imposing losses on depositors - were out of the question.

"Not only do I completely rule it out, I would consider it a devastating disaster to the economy," he said in a book-lined office, adorned by photos of his daughters and grandchildren.

"That would be a punitive measure, not a measure to save (Cyprus)."

Cyprus has already slapped pay cuts on an inflated public sector and tax hikes in anticipation of a bailout. Anastasiades said he did not favour conditions which were overly harsh.

"Our intention is to faithfully meet a loan agreement which will not provoke upheaval, or (include) unfair conditions from a negotiation made in haste under the pressure of time," he said.