ECONOMY

In Brief

Irish rating could be cut after bank pledge Ireland’s credit rating may be cut by Moody’s Investors Service after the government pledged as much as 50 billion euros ($68.6 billion) to save the country’s banks. Ireland’s Aa2 rating will «most likely» be cut by one level if a downgrade goes ahead, the company said in a statement yesterday. A downgrade by Moody’s, which will finish its review within three months, will bring Ireland’s rating into line with Standard & Poor’s and Fitch Ratings. «We’re monitoring the banking system, which we now see has led to additional capitalization needs,» Dietmar Hornung, a Frankfurt-based Moody’s analyst, said in a phone interview, adding that the government won’t need outside aid. «The focus is on Ireland’s ability to recover financial strength.» Irish Finance Minister Brian Lenihan said on September 30 the cost of repairing the country’s financial system may ultimately rise to about a third of gross domestic product. The country’s deteriorating finances have fueled investor concerns it would become the first government after Greece to tap the 750-billion-euro rescue fund set up by the European Union and International Monetary Fund to stanch the debt crisis. (Bloomberg) Kuwait, Cyprus to explore investment possibilities NICOSIA (Reuters) – Kuwait and Cyprus said yesterday they would explore reciprocal investment opportunities, such as in energy and services, as they signed a deal to avoid double taxation for companies operating in the two countries. «We think that there are a lot of opportunities in Cyprus, either with the government of Cyprus or directly with the private sector,» said Kuwaiti Finance Minister Mustapha al-Shamali. He added that Cypriot businesses, particularly services, could invest in Kuwait. Asked whether Kuwait’s potential investments in Cyprus could include the energy sector, al-Shamali said: «Yes. Our investments cover all fields. In the energy sector, we could help.» Cyprus has recently began a foray into hydrocarbon exploration, opening up offshore sea plots to potential exploitation in 2007. Officials say they are preparing a new licensing round, where plots are made available for potential hydrocarbon exploration and exploitation. They have not been specific on the timing. Al-Shamali said Kuwait could offer Cyprus help in tackling its chronic water shortages. Cyprus is one of the most arid member states in the EU and is increasingly reliant on water desalination to meet its needs. «We have the technical know-how in desalination,» al-Shamali said. Airport tender Greece will delay naming the winner of a tender to build a 1-billion-euro ($1.38 billion) airport on the island of Crete, a senior government official said yesterday, citing technical reasons. Kastelli International Airport on Crete is the only major infrastructure tender planned this year. Greece had initially set an October 19 deadline to open submitted bids and name a winner. «I don’t think we will meet the October 19 deadline,» an Infrastructure Ministry official who declined to be named told Reuters. «There have been some delays due to environmental issues and radars, which have to be included in the tender.» (Reuters) Power export Bulgaria can start exporting electricity to neighboring Turkey at the end of October when the Turkish power grid is connected to the European network, the Bulgarian Economy and Energy Ministry said. Sofia can sell 150 megawatts of electricity in November and December and up to 500 MW per month as of next year, the ministry said in a statement after Economy and Energy Minister Traicho Traikov held talks with his Turkish counterpart Taner Yildiz. Bulgaria’s state power utility NEK will open a tender for the sale, the ministry said late on Monday, adding that 12 companies have already expressed interest in participating. Turkey canceled power purchases from Bulgaria in 2003, saying Sofia had failed to press ahead with infrastructure projects that were part of a bilateral energy deal which included building a hydropower project at the Gorna Arda River near the border with Turkey. After years of delays, Bulgaria has signed a deal with Austria’s EVN to restart the project. The ministers also discussed the construction of a gas link between the two countries which is expected to become part of the Nabucco gas pipeline, aimed at bringing gas from the Caspian region to Europe. (Reuters)