ERINA Update 
                        (Eritrean News Agency,
                        Tel: ++291-1-117627,
                                Fax: 127385)
                                 Monday, June 21, 1999

    1.  The Eritrean and Italian governments yesterday signed an Indicative
    Programme of Cooperation (IPC) for 1999-20001.  The Programme will focus on
    human resource development, entrepreneurial and economic development, and
    social services. The agreement was signed by Eritrean Minister of Finance
    Gebreselassie Yosief and Italian Deputy Minister for Foreign Affairs Rino
    Serri. The IPC is worth a total of 127 million euros in grants and soft
    loans over a three year period.

    2.  The Eritrean Ministry of Foreign Affairs has denied claims by Ethiopia
    that any fighting occurred over the weekend. Responding to reports from
    Addis Ababa that Ethiopia "had repelled new Eritrean offensives over the
    weekend," Head of Asia and Australia Desk at the Ministry Tesfamariam
    Tekeste said, "The accounts coming from Addis Ababa are, in keeping with
    pattern, completely without basis and designed to mislead the Ethiopian
    people. There has been no fighting since early last week when the TPLF
    ceased its offensives after successive defeats. Their strategy is to mislead
    their population through reports of fictitious battle victories and to
    persuade Ethiopians that Eritrea verges on some social or economic collapse.
    But no one is mislead; their own defense forces know the degree to which
    Ethiopia's figures for the battlefield are a reflection of their own losses.
    Neither is the Ethiopian population likely to consume the stories of famine
    in Eritrea, particularly as Ethiopian's domestic situation in that regard is
    so well known. Anyone seeking to understand the nature of Ethiopia's
    difficulties on and off the battlefield should simply examine what it is
    they try to project on Eritrea."