THE 4TH ANNUAL CAPITAL LINK FORUM CONFERENCE
Monday October 30, 2000

Mr. Nicolas Bornozis

President,

CAPITAL LINK, INC.

Greece Enters a New Investment League

Ladies and Gentlemen,

It is with great pleasure that for the fourth consecutive year I have the privilege to welcome you to our annual conference which has by now become a tradition. Capital Link took the initiative in 1997 to establish an annual Forum whose objective is to keep US investors informed of the achievements, developments and above all the opportunities and challenges in the Greek economy, stock market and companies. Every year, we organize this Coneference with the cooperation of a Greek partner, this year the American Hellenic Chamber of Commerce, a 70 year old organization and one of the most actice Chambers in Europe.

This year's Conference is of particular importance. It is the first one after Greece's recent accession to the EMU and its uprgrading to developed stock market status, events which propel Greece to a new league.

Greece entered the final stretch on the track to developed market status in June 2000, when the European Union confirmed Greece's participation in the eurozone, beginning in 2001. Having successfully leaped the hurdles to meet the Maastricht criteria, Greece may begin reaping the rewards of its strict, lengthy, and at times painful regimen. And, as every winning athlete knows, it must continue to stay on track to achieve even greater results: real convergence.

Piggybacking the EU announcement was the Morgan Stanley Capital International (MSCI) announcement that Greece will be included among its developed market indices as of May 2001. Since the MSCI announcement, investors throughout the world have been gradually including Greece in their investment perspectives. On August 17th, 2000, MSCI altered the companies in its MSCI Greece Index. Then, at the end of September 2000, Standard & Poor's announced it will include Greece in its own developed market indices as of May 1, 2001. Several other index houses, including FTSE, had done so even earlier.

Greece's upgrade to developed market status will have substantial positive implications for the stock market, listed companies, and the economy in general. The vast majority of assets under management worldwide focus on developed markets, and investors in these markets tend to have a longer-term perspective, with more stable a presence, than those in emerging markets. Greece's transition is expected to generate a net inflow of funds between $ 15 and $ 25 billion.

Investment Managers construct their portfolios against a broad-based index, such as the MSCI indices, in an attempt to compete with the performance of that index; they buy the same or similar shares as are in that index and compete by adjusting their weighting according to their own strategies. MSCI indices are the most widely used benchmarks by global international portfolio managers. According to a recent Merrill Lynch/Gallup survey, over 90% of institutional international equity assets in North America and Asia are benchmarked to MSCI indices. In Europe, more than half of Continental fund managers currently use MSCI indices as their benchmark.

The Greek stock market has been part of several developed market and regional indices for some time, and the recent re-rating by MSCI completes the process of including Greece among the developed stock markets of the world.

Experienced Investors worldwide are starting to look at Greece, to familiarize themselves with the market, and the opportunities it presents. Many investors will start investing long before May 2001 to take advantage of current attractive valuations and to avoid congestion from new investors entering closer to the May reclassification date.

The new MSCI Greece Index is composed of 45 blue chip companies that form the "Greek Team" within the global MSCI Indices. Of the latest index consisting of 34 companies, six former qualifiers were cut and 17 new entries were added. These companies must stay on their toes; indices are regularly revised. It is a very competitive environment in which only the strong survive and there is considerable equity and international exposure at stake.

Not only will large cap blue chips benefit from this new environment but medium and smaller caps will also. Upgrading to developed market status means that the majority of investors from developed markets can invest in Greek stocks. In the U.S. and Europe, there are investors who focus particularly on small and medium cap companies which are not usually included in the traditional global or regional large cap indices.

Greek corporate managers are entering a very competitive arena. They will be compared to an entirely new peer group of international powerhouses‹from Germany, France, and the rest of the world. Greek managers must fight for the attention of a very sophisticated investor group, one that lacks the tolerance and patience that an emerging-markets investor must have. Many Greek companies are well prepared for this challenge and have become much more international in their orientation. They are expanding in Europe and the United States as they achieve leading positions in Southeast European markets, markets that have substantial growth potential.

To their advantage, Greek companies today operate in a very favorable economic and business-friendly environment. Annual GDP growth is expected to remain around 4.5-5%‹ a rate far above the EU average. Inflation remains low and interest rates are rapidly declining to EU levels. Several important privatizations are planned for fall 2000. Between 2000 and 2006, Greece will receive a massive injection of 25 billion euro from the Third Community Support Fund, much of which will be channeled into infrastructure development. In addition, preparations for the Olympic Games are generating new demand and substantial business across the board and in all sectors. In the last several years, Greek companies have achieved an annual earnings growth above the EU average and, given the present economic environment, there is every reason to believe that their robust earnings growth will be sustainable.

Greece's re-rating bodes well for the market and particularly well for investors. Greece's admission to EMU solidifies continued economic and financial stability, enabling investors to concentrate on stock market conditions and company fundamentals. Market mechanisms have gone through important and extensive improvements in infrastructure, operations, and regulatory context and more improvements are expected in the near future. There are no foreign exchange controls and no taxation of capital gains. And, after a correction of almost 40% from the highs of last September, current valuations are very attractive.

Being in a new league is always a challenge. Greece has proved that it can rise to the challenge and perform at highly competitive levels. The developments of 2000 indicate that it will stay on track and finish the stretch in winning form. The rewards promise to be golden.

ORGANIZERS