ECONOMY

In Brief

Greece’s spot threatened by Chinese shippers Greece’s ranking as the world’s largest shipowning nation is under threat from China, as better access to financing in Asia allows Chinese rivals to build their fleets faster, Petrofin Research said. A «lack of finance» is preventing some Greek shipowners from meeting commitments to build new ships, Athens-based Petrofin said in a report published yesterday. By contrast, Chinese owners have been «assisted during such difficult times by the still-buoyant Chinese economy and the influx of new Far East financing,» it said. Asian banks have taken a greater role in ship financing after avoiding the worst of the credit crunch, which slashed lending and forced Germany’s HSH Nordbank AG, the bank with the most outstanding loans to shippers, to seek government funds. Mitsubishi UFJ Financial Group Inc surpassed Norway’s DnB NOR ASA as the world’s biggest lender to the shipping industry in the first quarter. (Bloomberg) Cypriot chamber and EIB in lending agreement The Cyprus Chamber of Commerce and Industry (CCCI), which represents more than 8,000 businesses on the eastern Mediterranean island, said it has reached an agreement with the European Investment Bank (EIB) for 228 million euros ($316.1 million) in loans to small and medium-sized Cypriot companies. Businesses with fewer than 250 employees can request loans, to be made available through three Cypriot banks, to finance 50 percent of investment projects or as much as 25 million euros, the Nicosia-based organization said in a statement on its website. Bank of Cyprus, Marfin Popular Bank and Hellenic Bank, Cyprus’s three largest lenders, will respectively channel 120 million euros, 50 million euros and 58 million euros of EIB loans to businesses, according to the statement. The three banks will also make available a further 228 million euros in loans to small companies. Investing in land development is excluded from planned investments. All Cypriot companies can apply directly to the EIB for loans of more than 25 million euros. (Bloomberg) Bulgarian currency Bulgaria will apply to join the pre-euro European Exchange Rate Mechanism (ERM-2) waiting room in November and keep its currency peg to the euro until joining the eurozone, the prospective finance minister in the next government said yesterday. Simeon Djankov, a World Bank economist, said devaluing the lev peg to the euro in response to the global crisis was out of the question. The next government will implement other measures to fight recession and maintain fiscal stability, he said. «Definitely, with 100 percent certainty, Bulgaria will maintain the currency peg until joining the eurozone,» Djankov told Reuters in an interview. (Reuters) Spread widens The premium that international investors are demanding to hold Portuguese government debt rather than eurozone benchmark German Bunds rose to 106 basis points yesterday ahead of a sale of the peripheral issuer’s 10-year bonds. The 10-year Portuguese OT yield spread rose from 100 bps in Tuesday’s late European trading to mark its highest level since June 24, according to Reuters charts. «The auction of up to 1 billion euros of June 2019 OTs today is the primary driver,» said Peter Chatwell, a bond strategist at Calyon in London. (Reuters)