OMRI DAILY DIGEST
No. 128, 3 July 1995
NOTICE TO READERS: The OMRI Daily Digest will not appear Tuesday, 4 July
1995, an American holdiay.
POPE IN SLOVAKIA. John Paul II arrived in Slovakia on 30 June for a
four-day visit, international and Slovak media reported. Addressing a
crowd in Bratislava, he urged reconciliation within Slovakia, asking all
Slovaks to help build democracy and protect the rights of citizens. He
also praised the recently signed Slovak-Hungarian treaty, which
guarantees minority rights. President Michal Kovac expressed the hope
that the Pope's visit will calm down the political atmosphere in
Slovakia. In Kosice, the pope canonized three martyrs--Marek Krizan,
Melichar Grozdiecki, and Stefan Pongrac. Some 300,000 people attended
the canonization ceremony, despite high temperatures. -- Jiri Pehe,
OMRI, Inc.
HUNGARIAN COMMUNISTS COMMEMORATE KADAR. Some 3,000 people on 1 July
gathered at Budapest's Kerepesi Cemetery to commemorate the sixth
anniversary of the death of Janos Kadar, a former communist leader,
international media reported. The gathering, organized by the far-left
Labor Party, was called to protest the current cabinet and urge the
election of what the Labor Party described as a genuinely left-wing
government. -- Jiri Pehe, OMRI, Inc.
ROMANIAN NATIONALISTS WANT FOREIGN PORTFOLIO. Gheorghe Funar,
controversial leader of the Party of Romanian National Unity (PUNR),
told Radio Bucharest on 1 July that his party will seek to obtain the
foreign affairs portfolio. Funar was speaking after a meeting of the
PUNR National Council on 30 June-1 July. He sharply criticized Foreign
Minister Teodor Melescanu for allegedly making concessions to Hungary
over a new bilateral treaty, whose draft he described as "an act of
treason." The PUNR has four ministers in the current cabinet. Prime
Minister Nicolae Vacaroiu attended the PUNR meeting. -- Dan Ionescu,
OMRI, Inc.
ROMANIA'S HUNGARIANS OPPOSE EDUCATION BILL. Leaders of the Hungarian
Democratic Federation of Romania (UDMR) met in Targu Mures on 30 June-1
July to elect a Permanent Delegation and to confirm the 132 members of
the party's new Council of Representatives (which has been described as
the mini-parliament of Romania's Magyar population). The Targu Mures
meeting adopted a declaration denouncing an education bill passed by
Romania's parliament last week as anti-Hungarian and anti-minorities.
The UDMR called on President Iliescu to reject the law. -- Dan Ionescu,
OMRI, Inc.
[As of 12:00 CET]
Compiled by Jan Cleave
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A tovabbterjesztest a New York-i szekhelyu Magyar Emberi Jogok
Alapitvany tamogatja.
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Reposting is supported by Hungarian Human Rights Foundation News
and Information Service.
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Monday, 03 July 1995
Volume 2, Issue 127
REGIONAL NEWS
-------------
**HUNGARY'S CONSITUTIONAL COURT CHALLENGES AUSTERITY PACKAGE**
Hungary's Constitutional Court on Friday declared parts of the
recently approved austerity package unconstitutional. The
package is the key element in the government's effort to
lower this year's budget deficit from about 5 and a half
percent of the gross domestic product to 3 percent. The court
says Hungary cannot immediately stop universal child support
payments... but the benefits can end after giving families
more time to prepare. The court adds that a social security
tax on intellectual property is unconstitutional because the
payers don't receive social security benefits. In a statement
responding to the courts decision, the Prime Minister's office
says the cabinet will meet Thursday to discuss measures for
maintaining the deficit targets.
**ETHNIC HUNGARIANS APPEAL TO ILIESCU OVER EDUCATION LAW**
Ethnic Hungarian politicians called on President Iliescu to
reject a new education law which they say denies them their
language rights. The Union of Democratic Hungarians of Romania
issued a statement after a two-day conference in Cluj, in
Transylvania, termed the new law "more discriminatory, more
anti-Hungarian, and more anti-minority than all the laws of
the communist regime". The law passed by Parliament last week
has become a bone of contention in current talks between the
Romanian and Hungarian governments on finalising the
Hungarian-Romanian basic treaty. While the law defines
Romanian as the national language and the main language of
education it does allow some room for others. But Hungarians
say it does not go far enough as it stops short of allowing
university stidies in Hungarian. However, in another weekend
political meeting the Romanian National Unity Party increased
the tension over the issue by threatening to quit the
government if any more concessions were made in the treaty
talks with Budapest.
**BUDAPEST HOSTS LAND-MINES CONFERENCE**
At least 12,000 civilians around the world are killed by land
mines every year. Now efforts are being made to end these
senseless deaths. On Thursday and Friday, representatives from
31 countries met in Budapest to consider banning the
production of the most dangerous mines. However, they put off
making a decision until the autumn. America and Britain want
to ban the production and distribution of so-called dumb
mines, which have no capability to self-destruct after a
period of time. They remain in the ground well after
hostitlities have ceased and explode when farmers plough over
them or people walk in the area. It is estimated that there
are about 100 million uncleared mines in 65 countries world
wide, largely undected. Alyson Bailes head of the security
policy department in the British Foreign Office, told CET that
those tackling the problem are trying to focus on what she
calls irresponsible and indiscriminate use of land mines and
the proliferation of land mines, all of which causes
unnecessary deaths and unnecessary suffering to civilians.
Both the U.S, and British delegates say they are not upset by
the meeting's failure to approve their accord as thei the
Convention on Conventional Weapons which will be reviewed in
September. Only after the review, they say, will it make sense
to put together a specific program for mines.
BUSINESS FEATURE
----------------
**SPT TELECOM DEAL FAILS TO STOP SLIDE IN PRAGUE**
By Duncan Shiels
Two major events in Central Europe's financial world promised
to breathe some life into the region's sluggish stock markets
last week. The previous Friday Poland's cabinet relieved
worried investors by announcing it would not introduce a
capital gains tax before 1997, while Wednesday saw the
announcement that a consortium of Dutch and Swiss Telecoms had
won the tender to buy 27% of the Czech Republic's
telecommunications giant SPT Telecom. But while the Warsaw
stock exchange's WIG index showed a 6.9% rise over the week,
Prague's PX50 continued its slide well below the 400 level.
In our weekly survey of the region's markets Nick Wergen, of
Smith New Court in London, began by explaining Warsaw's
new-found buoyancy.
Wergen: A bit of enthusiasm coming from the suspension of
capital gains tax, as well as some optimism from the finance
minister, if not necessarily believable optimism, that
inflation would be below one percent for both June and July.
So, yes, allowing volumes to pick up, average volume this week
27 and a half million, shows that there's certainly a bit more
interest.
CET: Do you believe the finance minister Kolodko?
Wergen: I certainly don't believe his suggestion that 20 percent
is still an achievable target for the full year. He was
talking about 18 to 20 percent for the second half, 20 per
cent for the full year. I would still imagine that you're
looking for a year-end inflation figure of above 26 percent.
CET: Well, now that that announcement has finally come out on
the capital gains tax, will this increased volume continue
or will it just subside again with that out of the way?
Wergen: I think we're in a range still on the WIG of between say
7,000 and 9,500. I think we're creeping towards the top of
that range and all it needs is political comments to unsettle
the market and that clearly can be likely the whole way up
to the presidential elections. So a nice bit of positive
momentum, I don't think it's going to be particularly
long-lived. I don't think we're heading to any kind of
disaster or particularly positive environment. We're stuck
in a fairly tight trading range until October.
CET: Now, moving on to Prague, we've had the SPT deal
announcement, it seems to have been well received, but the
PX50 continues to fall. How come?
Wergen: There just is not enough pick-up in international
volumes to push the market up. Domestic volumes at the end
of this week slightly improved the situation but these were
largely just some form of speculation on SPT. There isn't
enough interest yet in terms of value. It looks cheap but the
earning momentum is not convincing enough in comparison with,
say, Poland or even Hungary. So, unfortunately, I think the
market is going to remain in a down trend until you get closer
to 350 or even through that on the PX50.
CET: Well, the SPT Telecom shares were bought at a price well
above the floor price. Won't that bring it up, slightly? It's
such a large volume share.
Wergen: Not necessarily at all. It's a question of who's going
to be buying it to take it up to that level. It was fairly
discounted ahead of the strategic stake that the bid was going
to be above 4,000 Czech crowns and the stock didn't move. I
would imagine that somethimng like 3,000 is probably as far
as it's going to go. Remember we do have a precedent with
Matav in Hungary, where the strategic stake is sitting at
quite a substantial premium to the underlying OTC in Hungary
quote.
CET: I'm wondering what your view of the deal is?
Wergen: I think it was a fairly neutral solution. I imagine that
the Czech authorities have not had necessarily totally
successful dealings with the French over CSA, with Volkswagen
over Skoda. It's a fairly neutral deal to hand it through to
the Swiss-Dutch consortium at the same time as the fact that
it was the second highest so they can justify it in terms of
bidding price.
CET: Now, a little excitement in Budapest, a bomb scare on
Tuesday.
Wergen: Yes, 75 minutes' trading on Tuesday wasn't particularly
great! The market off just below 2 percent for the week, but
you know it is privatization, privatization, and
privatization. News throughout the week on Matav, on OTP,
on MVM, on MOL, that's all the market can focus on. I think
it's going to just keep on going sideways while all these
stocks are digested.
CET: So it's all eyes on OTP?
Wergen: Absolutely.
ABOUT CET ON-LINE
-----------------
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A tovabbterjesztest a New York-i szekhelyu Magyar Emberi Jogok
Alapitvany tamogatja.
[*] [*] [*] [*] [*][*] [*][*][*]
[*] [*] [*] [*] [*] [*] [*]
[*][*][*] [*][*][*] [*][*] [*][*]
[*] [*] [*] [*] [*] [*] [*]
[*] [*] [*] [*] [*] [*] [*]
Reposting is supported by Hungarian Human Rights Foundation News
and Information Service.
*****************************************************************
|
