ECONOMY

In Brief

Cyprus cuts VAT repayment time NICOSIA(Reuters) – Cyprus is cutting repayment periods for value-added tax to boost state coffers hit by a decline in tax earnings, the island’s Finance Ministry said yesterday. The measure would be applicable to about 80 large businesses which would be obliged to repay VAT within two months and 10 days, rather than holding on to receipts for four months and 10 days which is the current practice. «This measure will improve public finances for 2009 with additional earnings of 50 million euros,» said Finance Minister Charilaos Stavrakis. A decline in value-added tax earnings linked to consumer spending has added to shortfalls in the fiscal balance, with the island nation looking at a public deficit this year. Authorities say they will strive to ensure it remains within 3.0 percent of gross domestic product, which is a threshold for eurozone members. Cyprus has been using the euro since January 2008. Businesses said they disagreed with attempts to shorten the VAT repayment period because it would further tighten liquidity in a system that relies heavily on credit. «Its an oxymoron for the republic to add to the liquidity problems our businesses face when other countries are trying to alleviate the problem,» the Cypriot Chamber of Commerce and Industry said. The cap for value-added tax in Cyprus is 15 percent, with lower tax on certain categories of goods and services. Alapis 451-mln-euro rights issue a hit Greek pharmaceutical company Alapis said late Monday it had successfully completed a 451-million-euro ($660.6 million) rights issue, the second largest in the country so far this year, to fund buyouts. Alapis offered 980,600,220 new shares at a deeply discounted 0.46 euros. The issue, underwritten by Amro, Bank of America – Merrill Lynch, BNP Paribas, Deutsche Bank and Jefferies, was oversubscribed by about 1.5 times, the company said in a bourse filing. Alapis said last month that private equity fund Lamda Partners would subscribe and invest about 90.2 million euros, exercising 196 million rights, about 20 percent of the new shares. (Reuters) Michaniki bid Michaniki SA, Greece’s fifth-biggest builder, said it placed the lowest bid to build a 12-kilometer tunnel for the diversion of a dam in Greece. Michaniki told the Athens bourse in a statement yesterday it bid 65 million euros for the project, bringing its total backlog to 1.15 billion euros. (Bloomberg) PPC plans Public Power Corp, Greece’s biggest electricity company, approved plans to proceed with a 350-million-euro Cycladic interconnection project that will provide improved power supply to the islands of Syros, Paros, Naxos and Myconos. The company will call for bids for the project following a two-month public consultation, according to an e-mailed statement yesterday. (Bloomberg) Bulgaria recession The International Monetary Fund said Bulgaria’s economy will contract 6.5 percent this year, revising a previous forecast for a 7 percent decline. The IMF ended a 10-day mission in Bulgaria to assess measures taken by Prime Minister Boyko Borisov’s government to cut spending and raise revenues, IMF mission leader Bas Bakker told journalists yesterday. (Bloomberg)