ECONOMY

In Brief

HP and Lukoil/Petrola to set up Balkan subsidiaries Hellenic Petroleum (HP) and the consortium of Russia’s Lukoil and Greece’s Petrola, currently negotiating the acquisition of a 23-percent stake in HP, have thrashed out a a draft agreement for strategic expansion in the Balkans, providing for the establishment, initially, of a holding company in Athens and seven subsidiaries in as many Balkan countries. Further subsidiaries may be set up later in Slovenia and Estonia. The two sides will hold equal stakes in all companies which will have independent management and will gradually transfer all their existing assets in these countries to the respective subsidiaries. According to sources, in yesterday’s negotiations Lukoil pledged to produce a full list of oil deposits it controls in the Caspian region, some of which will be offered to HP for exploration and production. Separately, Lukoil signed a deal worth an estimated $12 million for 16 gas stations owned by BP and ExxonMobil on Cyprus. OTE to supply advanced services to Romtelecom OTEGlobe, a subsidiary of OTE Telecom, will supply advanced, high-speed, infrastructure services for voice and data transfer to Romania’s Romtelecom utility, according to a deal announced in Bucharest yesterday. The package includes four types of service, Clear Channel, Asynchronous Transfer Mode (ATM), Frame Relay (designed mainly for safe data transfer for multinational firms) and IP Transit, for advanced Internet access requirements. Gas partnership Gazexport, a subsidiary of Russia’s Gazprom, and Greece’s Kopelouzos group have set up a joint venture, Gazkop, in the production of power and sales to large consumers. The two sides will hold equal stakes, while Gazexport’s General Manager Oleg Sienko will assume the post of chairman and Dimitris Kopelouzos that of managing director. The new company will also carry out investment activities complementary to those of their partnership in Prometheus Gas which imports natural gas. Tobacco growers Farmer’s representatives have called for caution so that «measures against smoking may not be identified with measures against tobacco growing.» Speaking at a meeting with other industry representatives, they charged that the public health issue in the EU was deliberately played up with a view to stopping subsidies to tobacco growers. «The result will be that Europe will have to import tobacco of inferior quality.» Greece is the main tobacco grower in the EU, which imports 70 percent of its requirements, while tobacco cultivation is the main or sole source of income for 64,000 Greek families. Tobacco duties and taxes amount to 2.2 billion euros annually, representing 7 percent of all public revenue; 73 percent of the price paid for tobacco products goes to the public coffers. Bankruptcies Filings for bankruptcy skyrocketed 623 percent to 152 in May from a year earlier. Firms declared bankrupt also rose 60 percent to 45. By contrast, unpaid bills of exchange and bounced checks fell 21.36 percent in the same month to total 47 million euros.