Summed up

  • 1999-03-18
SETTING UP JOINT BALTIC SECURITIES MARKET: The three Baltic countries are planning to sign a memorandum of understanding in April to set up a joint Baltic securities market, said Riga Stock Exchange President Uldis Cerps. After the memorandum is signed, a concrete plan for cooperation among the three stock exchanges will be worked out. Cerps said the main problem will be account settlements among Latvian, Estonian and Lithuanian depositories which have yet to agree on procedures. Cerps also stressed the need for a unified order for licensing securities market makers. He did not rule out Baltic stock exchanges' future integration into the Nordic states market.

FINNS TURN AGAINST ESTONIAN TEXTILE: Finnish textile workers' unions are ready to follow the example of seamen's unions and demand that Estonian wages be raised to Finland's average level. Auli Korhonen of the Finnish Textile and Garments Union told the Aripaev business daily that they want Finnish companies with investments in Estonia to pay higher wages to Estonians. In Finland, sales of locally produced textile products have dropped to 16 percent of the total volume of the market. Finnish garment makers employ nearly 9,000 at their plants in Estonia. "Finnish unions are troubled by some kind of mental problems," said Meelis Milder, chairman of Estonia's largest garments maker Baltika. "By searching for cheaper sub-contractors, the Finnish manufacturers have made their decisions long ago."

WILLIAMS ANTES UP TO SIGN A DEAL: The Lithuanian government and Williams International have reached last stages in negotiations over Mazeikiu Nafta. "Williams hopes to complete the talks on investment soon and start working at Mazeikiu Nafta," said Williams Lietuva Director General Randy Majors in a statement. "The company is committed to the earlier signed agreements with the government and will not lower the planned investment," he said. Williams has pledged to pay $150 million for a new share issue by the Mazeikiu Nafta concern which includes the Mazeikiai oil refinery, the Birzai-based pipeline company and the offshore terminal at Butinge. "We seek to turn the company into the region's leading oil product exporter and to make Butinge the most profitable and successful oil export channel from the east. These goals remain unchanged." Majors said investment in Mazeikiai Oil remained Williams' top priority, referring to recent press reports that the U.S. company might invest in other Baltic and Russian projects.

VENTSPILS MEASURES SWORDS WITH BUTINGE: A Ventspils official questions the ability of the Lithuanian oil terminal in Butinge to become the leading oil export outlet in the Baltics. Ventspils Nafta council Deputy Chairman Janis Blazevics said the Ventpils port has many technical and environmental advantages over the Butinge oil terminal. Blazevics pointed out that Butinge terminal could become more profitable if the Lithuanian state decided to subsidize it. In that case a rate war will begin between Ventspils and Butinge, he predicted. At present most oil transit in the Baltic region is handled by the Ventspils port.

OLDEST BALTIC BREWERY CHANGES HANDS: The owner of the Tartu and Saare breweries in Estonia, AS A. Le Coqhas, signed a preliminary agreement on the purchase of a controlling stake in the Cesu Alus brewery in Latvia. The Cesis brewery, founded in 1590, is the oldest brewery with a recorded history in the Baltics. AS A. Le Coqhas, whose major shareholder is Finland's Olvi Oy, would buy 50.29 percent of Cesu Alus shares from the Norwegian-Latvian Business Development Fund. The deal is scheduled to be signed on April 6, after endorsement of the company's financial report for 1998. The purchase of a controlling stake in Cesu Alus corresponds to Olvi's strategy which requires searching for cooperative partners in the Baltics for Tartu Olletehas brewery, Olvi's largest holding in Estonia.

ENERGY COMPANY WANTS ITS OWN POWER STATION: Cinergy Global Power, a co-owner of the regional Narva power grid, announced that it could build its own power station in Narva. "If Eesti Energia fails to ensure a cheaper tariff to us, we will have to set up a new power station," Cinergy Development Director John Poulton told the Eesti Paevaleht daily. "We are sure that we're able to produce cheaper electricity than Eesti Energia." Poulton said that Cinergy could set up a gas-powered electric power station with about 100 megawatt capacity in Narva, the border city where Estonia's two largest power stations are also situated. The national energy company is selling electricity to the Narva grid at 0.4 kroons ($0.02) per kilowatt-hour.