Montenegro gains independence

The Balkan country of Montenegro has separated from Serbia and received recognition as the world's newest independent state from the European Union and the former Yugoslav republics of Croatia and Macedonia.

A statement issued on behalf of foreign ministers said: "The European Union and its member states have decided that they will develop further their relations with the Republic of Montenegro as a sovereign, independent state.

Low cost homes needed in South Africa

South African Housing Minister Lindiwe Sisulu, plans to address the desperate shortage in the low-income segment of South Africa's housing market. She wants to force property developers who target the top end of the market to also build homes for low-income families. She is aiming to have legislation in place by March 2007.

IBM opens centre in Portugal

IBM is to establish a consultancy, auditing and business management services centre in Braga, northern Portugal. The centre will create about 1000 jobs. IBM plans to use the site to reinforce its position in business transformation outsourcing in the Portuguese market. The contract for the project has been signed between IBM and Portugal’s investment agency, API.

Bulgaria to build first skyscraper in Sofia

The building of the first skyscraper in Bulgaria will start by the end of this year. The 35-floor office building will be constructed near Kempinski Hotel in Sofia, which is one of the highest areas in the capital.

The estimated investment needed for the project is €45m. Roumen Markov from Joint Building Investment, the company in charge of the construction, said that he was already negotiating with future partners and potential investors.

The building area will cover over 32,000sqm. Architects have planned the construction of a helicopter landing pad and underground parking for over 870 vehicles. The facility will be for Class A office space only.

To improve accessibility to the new skyscraper, architects also plan to renovate the surrounding areas. Nearly 1km of Cherni Vruh Boulevard will run underground below a new park and a pedestrian alley will connect the two main parks in Sofia – Borossov Garden and South Park.

The renovation of the boulevard will cost over €13m and it will be the first project to be executed without municipality participation.

Cypriot airport expansions progress

Construction has finally started to renovate and expand Larnaka and Pafoa airports, Cyprus's only international airports, increasing capacity by almost 12m passengers/year. The Hermes Airports consortium has taken over both airports to construct new passenger terminals and associated infrastructure. The new passenger terminal at Larnaca will be able to handle up to 9m passengers/year, and the extended terminal at Paphos will cater for 2.7m passengers/year. Construction began in early June, with Paphos due for completion at the end of 2008, and Larnaca at the end of 2009. The company will also undertake further expansion of the airports as demand requires.

The €622m project to expand the two airports was agreed with Hermes after two years of negotiations and a 25-year concession awarded. The structuring of the deal is more favourable to Hermes compared with other European airport deals – such as Budapest, Bratislava - that have closed in the interim. Hermes will pay 33% of gross revenues to the state, and a fixed annual concession fee of €3.5m.

Citroën and Fiat expand into Turkey

Both PSA Peugeot Citroën and Fiat Auto are teaming up with Turk Otomobil Fabrikasi A.S. (TOFAS) to build a car production facility with an initial annual capacity of 135,000 cars, due to roll off the assembly line in late 2007.

The European Investment Bank (EIB) has loaned Turk Otomobil Fabrikasi A.S. (TOFAS) €75m for the joint venture that will produce small commercial vehicles for the European market. The project will assist the two major EU automotive companies to consolidate their presence in a strategic pre-accession market and help Turkey to build up a modern and competitive industry, contributing to prepare the country for EU-accession.

The EIB loan, part-financing for total investments estimated at €400m will result in an important expansion of the company’s production capabilities and create some 5,000 new jobs. The vehicles will be produced at TOFAS’ manufacturing plant in Bursa, a city of 1.5m people in northeast Turkey. Head quartered in Istanbul, TOFAS is listed on the Istanbul Stock exchange and currently has an annual production capacity of 162,000 vehicles.

“Turkey is developing into a dynamic emerging market and offers attractive conditions for investors wishing to manufacture high quality products”, said EIB vice-president Wolfgang Roth. He added that this additional investment reflects the Bank’s confidence in the Turkish automobile sector.

The Turkish Automotive Manufacturers Association (OSD) predicts that the country’s production capacity for cars, which is currently around 920,000 units, will more than double by 2010, based on domestic demand as well as export opportunities. In recent years, political and economic developments in Turkey have resulted in a sharp increase in FDI in 2005 and 2006, with the Turkish car industry just one sector of the economy to benefit. Financing made available by the EIB in Turkey since 2000 stands at over €4.5bn and relates to investments in a wide range of key economic sectors.