Greek investors in FYROM not anxious about new government

Greek companies active in the Former Yugoslav Republic of Macedonia (FYROM) are awaiting the formation of the neighboring country’s government after the recent elections for indications of any changes in economic policy. Although, in general, there is no fear that the good climate that prevails will now be disturbed, business plans have been put on hold. Well-informed sources in Skopje say the new government is determined to investigate the sale of a majority stake in the country’s main refinery, OKTA, to Hellenic Petroleum. But Greek business circles in the country are saying that government interference in this investment would have a negative impact on bilateral economic relations. After the elections in which Branko Crvenkovski’s party prevailed, OKTA received a message that inspectors would be descending on the company. In an interview with Kathimerini earlier this month, Crvenkovski repeated claims casting doubt on the legality of the investment. «We have not even seen the agreement. When it came to Parliament for ratification, deputies did not know its exact content, as there was mention of various paragraphs and notes that were not revealed. We must first see what exactly was agreed upon,» he said. He did not rule out the issue being reopened and returning to Parliament for further scrutiny; Hellenic Petroleum has repeatedly insisted that the deal was fully transparent. Diplomatic sources in Skopje hold the view that any intervention from the new government may be due to pressures from rival interests. This view is lent credence by Crvenkovski’s reference in the interview to «a clash inside Greece between Hellenic Petroleum and Jet Oil.» The other Greek enterprises in FYROM do not seem to be facing any similar problems. No one, for instance, is questioning National Bank’s acquisition of Stopanska Bank – which has 40 percent local market share – although this was the result of a direct deal with the government. Any such move is seen likely to have a domino effect that could deal a serious blow to the entire banking system. OTE Telecom last week signed a deal with Mobimak, a mobile phone company in FYROM, giving it the rights to use part of its network for the country’s second mobile network, MTS. Yiannis Kavalieratos, vice president of Zitolux (a member of Elbisco Holdings active in FYROM), says, «It does not seem likely that the new government will adopt a new attitude toward Greek investment interests.» He adds that it is hard to say whether there will be an improvement but that Zitolux has plans for further growth. Dimitris Beis, of Alpha Bank Skopje and head of the department serving Greek clients there, confirms that because of the uncertainty arising from the election period and in expectation of the new government, Greek entrepreneurial initiatives have stagnated recently but there are no signs of forthcoming changes in policy. «I see no reason for a change in climate,» he said.