ECONOMY

In Brief

Cypriot economy seen growing 0.6 pct this year Cyprus’s economy will expand 0.6 percent this year, based on fiscal data for the first six months of the year, and may reach 0.8 percent if growth in the second half exceeds 0.6 percent, Finance Minister Charilaos Stavrakis said. «The first signs from the tourism industry and the excellent performance of banks, judging by their deposits volume, indicate a strong third quarter,» Stavrakis told reporters in Nicosia yesterday. Cyprus’s deficit in the nine months through September 30 was 394.1 million euros ($555 million), or 2.25 percent of gross domestic product. Total revenue rose 6.3 percent to 4.6 billion euros and spending increased 5 percent to more than 5 billion euros, Stavrakis said. Cyprus has yet to decide on the size or maturity of a bond sale this month. The sale of bonds may raise 750 million euros or 1 billion euros and mature in five or 10 years, he said. (Bloomberg) Russia, Bulgaria agree on South Stream joint venture SOFIA (Reuters) – Russia and Bulgaria have agreed to begin a joint venture next month to build the Bulgarian part of the Russian-led natural gas pipeline South Stream, Gazprom Chief Executive Alexei Miller said yesterday. In July, Sofia and Moscow signed a road map for the pipeline, which aims to ship up to 63 billion cubic meters of Russian gas per year under the Black Sea to Central and Southern Europe, after Moscow committed to lower gas prices for Bulgaria. Initially, Bulgaria and Russia had planned to set up by February a 50-50 joint venture for the Bulgarian part of the pipeline, estimated to cost $835 million. «We have achieved significant progress,» Miller told reporters after meeting with Bulgarian Prime Minister Boyko Borisov. «We agreed to speed up the setup of a joint venture… I think we can establish it in November. We also agree to sign next week an agreement to launch a feasibility study for the Bulgarian part,» he said. Bulgarian Economy and Energy Minister Traicho Traikov confirmed that the joint venture would be set up next month. Miller reiterated that South Stream, controlled by Gazprom and Italy’s ENI, will have its first gas shipments to Southern Europe at the end of 2015. French power company EDF also holds a stake. Portuguese measures Portugal’s minority government is defending its proposed austerity measures in parliament, where opposition parties are fighting the plan’s abrupt tax hikes and deep spending cuts. Portugal, like fellow eurozone countries Greece, Ireland and Spain, needs to sharply reduce its high debt levels, which have driven its borrowing costs to unsustainable levels and triggered a financial crisis. Prime Minister Jose Socrates said yesterday that Portugal «needs to send a clear signal that we are determined to correct our situation.» The center-left Socialist government doesn’t have enough votes on its own to enact the measures, and its plan has deepened political tension. Parliament is due to vote on the plan at the end of the month. (AP) Euro gains The euro’s gains since June are a sign of confidence that the European Central Bank has succeeded in stabilizing financial markets, and the currency may climb another 4 percent, according to Aviva Investors. «The ECB has done a good job,» Pierre Lequeux, head of currency management at the investment-fund arm of British insurer Aviva Plc, which manages about $371 billion, said in an interview in London yesterday. This year’s sovereign debt crisis «was a strong test of the ECB’s credibility. They’ve come out of the fight with their head up, winning. We are bullish on the euro.» He forecasts the euro will climb to $1.45 by year-end. That’s more bullish than the $1.33 median of 44 forecasts by analysts and economists compiled by Bloomberg. Analysts’ predictions have ranged from $1.45 at the end of the year to $1.18 in July. The currency shared by 16 European nations traded at $1.4115 at 1.35 p.m. in London yesterday. The common currency slumped in June to its weakest level since 2006 as concern that countries from Greece to Spain would default on their debts roiled markets. The euro has climbed 19 percent against the dollar since then amid speculation the US will engage in a second round of asset purchases, known as quantitative easing, that will devalue the greenback. (Bloomberg)