ECONOMY

In Brief

Russia and Cyprus eye closer business ties NICOSIA (Reuters) – Russia and Cyprus signed a tax treaty yesterday that is expected to boost bilateral business ties and reaffirm Cyprus’s status as the primary source of foreign investment in Russia. Russian President Dmitry Medvedev, on a fleeting visit to the east Mediterranean island, led a delegation which signed pacts ranging from an accord on avoiding double taxation to technology, health and tourism agreements. «Our economic cooperation is developing very strongly, and it is not a one-way street,» Medvedev told reporters after a meeting with Cypriot President Dimitris Christofias. Cyprus has a long history of links with Russia, and with the former Soviet Union before that. Trade, which at one time involved bartering Cypriot wine exports for Russian tractors, is now worth billions of dollars. With one of the lowest corporate tax rates in the European Union, Cyprus is now an important springboard for investments into Russia. Some 20.5 percent of the $262.6 billion invested In Russia since the collapse of the Soviet Union has been via Cyprus. Thousands of offshore companies registered on the island are Russian, which reinvest profits back into Russia. The island, with a population of less than 1 million, has about 60,000 Russian speakers and the EU’s only communist head of state, Soviet Union-educated Christofias, a fluent Russian speaker. «There is a lot of momentum to strengthen and expand our ties,» the Cypriot leader said. Thessaloniki port courting additional Balkan links Thessaloniki Port Authority SA (OLTH), the operator of Greece’s second-largest port, is looking north to Balkan neighbors Bulgaria, Serbia and the Former Yugoslav Republic of Macedonia to boost cargo volume and revenue. The authority started a series of presentations in Sofia, Belgrade and Skopje to promote a 20 percent cut in tariffs, Stylianos Angeloudis, OLTH’s chairman, said in an interview in Sofia yesterday. The port plans a 240-million-euro ($335 million) expansion of its Pier 6 to add infrastructure and storage facilities and increase annual traffic capacity to 1.2 million containers, he said. «We’re here to present the favorable terms and services our port has to offer,» Angeloudis said. «The bulk of the goods handled by the port go to northern Greece. Of the three northern neighbors, the greatest number of the port’s customers are in Skopje, followed by Belgrade and Sofia. (Bloomberg) Bulgarians strike Thousands of Bulgarian workers marched through the capital Sofia yesterday, ratcheting up pressure on the government over pension reform a day after it withdrew an initial draft in the face of strong resistance. Some 10,000 workers from all parts of the Balkan country flocked to central Sofia for the biggest rally since the center-right government took office more than a year ago but the number was a third less than initially expected. Protesters chanted «We want our rights back» and waved banners reading «Hands off the pension system» and «Working till the grave for a miserable pension» to send the government a signal they would not accept demands they work longer for a full pension. (Reuters) Irish bank Allied Irish Banks Plc, the lender being taken over by Ireland’s government, said it will raise about $2 billion from the sale of its 22.4 percent stake in US lender M&T Bank Corporation to meet stricter capital requirements. The Dublin-based bank will offer 26.7 million notes at $77.50 apiece that will be exchanged for shares in M&T by November 15, it said in a statement late yesterday. It plans to hold a meeting of shareholders on November 1 to seek their approval. Ireland’s banks are raising capital after bad debts surged amid the collapse of a decade-long real estate boom, prompting a bailout of the industry that may cost as much as 50 billion euros ($70 billion). The government said last week it would take majority ownership of Allied Irish, which has been directed by the nation’s financial regulator to raise 10.4 billion euros by year-end to meet new capital standards. (Bloomberg)