ECONOMY

In Brief

OTE to fund Hellas Sat and up stake in Romtelecom to 54 pct OTE Telecom has decided to borrow $30 million in order to fund the first Greek satellite project, Hellas Sat, sources said. The project, estimated to cost $170 million, is a joint venture with Cyprus’s Avacom Net (43.3 percent), Cyprus Development Bank (19.6 percent) and the Hellenic Aerospace Industry (10 percent). According to sources, OTE, which has a 25 percent stake, set a ceiling of possible participation at $50 million if the prospect of new shareholders, such as SES Global and the Cyprus Electricity Authority, does not materialize. The $30-million loan will be used to pay Astrium, Europe’s biggest satellite group, and ILS, which have been contracted to build and put the satellite in orbit by March 2003. Hellas Sat will be used to broadcast the 2004 Athens Olympic Games. Separately, the Romanian government yesterday approved a $243-million share capital increase for the country’s telecom utility Romtelecom, as recently proposed by Greece’s OTE, which to date has held a 35 percent stake. Sources in Greece said OTE will ultimately come to control a 54 percent stake in the company. The agreement provides for a raising of OTE’s stake to 49 percent; 3 percent will be acquired directly from the government and a further 2 percent will come from a conversion of debt into equity. The deal is based on a $750-million total capital evaluation of Romtelecom, which includes an $85-million write-down, the second this year. In July, OTE wrote down the value of its stake in Romtelecom by 256 million euros to 363 million. (See adjacent column) Volume of Greek-Turkish trade multiplied in the 1990s Greek-Turkish trade rose spectacularly in the 1990s, with Greek exports rising from 1.4 percent in 1990 to 5 percent of the total in 2000, a study of the Panhellenic Exporters Association (PSE) says. The average annual rate of increase was 18 percent, while imports from Turkey rose at an annual average of 12 percent. Total bilateral trade rose from $223 million to $976 million. The development shows that the two countries’ enterprises tapped Turkey’s privileged relations with the EU, especially since 1995. Due to fluctuations in the value of exports, the trade balance is positive in some years and negative in others. Both countries seem to have a rather low export potential, but Turkish exports have a much larger industrial goods component (86 percent against Greece’s 29 percent). By contrast, Greek exports are 38 percent fuels and 28 percent raw materials, mainly cotton. However, PSE says that the two economies are not so complementary as some believed. Turkey ranks as Greece’s third strongest competitor, accounting for 9.4 percent of total competition in world markets, and the strongest (with 12.4 percent) as regards industrial products in particular. e-business The value of e-commerce business is expected to more than double from 8 million euros in 2001 to 17 million euros this year, and projected to skyrocket to 772 million (or 1.5 percent of total retail sales) by 2006, officials of the Greek Business Management Association (EEDE) said. A conference titled «The New e-Business – Environment, Opportunities» will be held in Thessaloniki on November 14 and 15.