ECONOMY

In Brief

Central bank chief again advises caution on wage rises Bank of Greece Governor Nicholas Garganas told Parliament yesterday the government’s revision of public finance figures of recent years, which have swelled the country’s official fiscal deficit and earned it rebukes from EU officials, was «correct and necessary.» Presenting the central bank’s interim report on the economy, Garganas chastised the previous PASOK government for granting «outrageous» pay raises in the public sector in 2003 and predicted that the public deficit this year will rise above the 5.3 percent of GDP projected by the government, which he urged to quickly adopt additional measures to bolster the growth prospects of the economy. He said Greek unit labor costs had risen 20.7 percent since 1999, against 9.2 percent in the eurozone. Further, he linked the success of the Greek merchant marine under internationally competitive conditions to the fact that the sector is unregulated. GDP increases 3.8 percent in the third quarter Greece’s gross domestic product grew by 3.8 percent in the third quarter of the year compared with that of 2003, after a 3.9 percent year-on-year increase in the second quarter, the National Statistics Service (NSS) announced yesterday. Expenditure on final consumption posted a yearly rise of 4.1 percent, contributing by 2.6 percent to the increase in final demand. In the same period investment rose by 3.2 percent from Q3 2003, helping final demand rise by 0.7 percent. Exports rose by 6.1 percent yearly (1 percent of final demand) and imports grew by 4.8 percent. With the rise of imports being smaller than that of exports, local products increased their contribution to domestic demand. NSS also reported that industrial production in September remained the same as year ago, although in the first nine months of 2004 it showed a 1.5 percent rise year-on-year. Olympic Catering Olympic Catering reported a 45 percent pretax profit rise to 3.13 million euros this year to September from 2.16 million euros in the same period in 2003, below expectations. «The company’s activity, which is related to airport and in-flight catering and handling, was not favored by the staging of the Olympics and their effect on tourism,» the company said in a statement. Turnover was at 32.55 million euros, almost the same as last year, and EBITDA rose to 6.48 million euros from 4.64 million euros in Jan.-Sep. 2003. The company views the rise in earnings before tax and depreciation to 5.1 million euros as particularly significant and expects total turnover for 2004 to reach 42 million euros, same as in 2003, and pretax earnings at 2.5 million euros, from 1.2 million euros last year. Real estate parting Greek consultancy and real estate services company CityScape announced yesterday the end of its consortium with Colliers International after 10 months of partnership. This has been the second friendly divorce in the sector recently after Sotiropoulos Bros and Cushman & Wakefield also ended their partnership. Market circles suggest the foreign firms aim at their local partners’ clientele first, but then disagreements in strategy force them to go separate ways.