Slovenia Business Week no 05, January 30th, 2006 Table of Contents: HEADLINES ............................................................................................................................. 3 Terme Catez Plans to Expand its Business ............................................................................ 3 Seaway's Shipman Again Awarded European Boat of the Year Title ................................... 3 Amendments to Trade Act Enter into Force .......................................................................... 4 INTERNATIONAL COOPERATION ...................................................................................... 5 Slovenian and Croatian Mayors to Form Cross-Border Partnership...................................... 5 Slovenia and San Marino Looking to Bolster Cooperation, FMs Say ................................... 5 Minister Discusses Cooperation with Portuguese Ambassador ............................................. 5 Finance Minister Hosts Meeting of Inter-American Development Bank .............................. 6 Slovenian-Bavarian Commission Unveils Future Cooperation Plans .................................... 6 Government Assesses Slovenia's OSCE Chairmanship as Very Successful ......................... 7 EUROPEAN UNION ................................................................................................................. 8 Slovenia Greatly Improves EU Fund Drawing Capacity ....................................................... 8 Barrot Discusses Infrastructure Projects with Transport Minister ......................................... 8 Barrot and MPs on Financial Perspective and Transport Policy ............................................ 9 Slovenia On Track for Euro Adoption, Austrian Minister Says ............................................ 9 EU Survey: Slovenians Favour Solar over Nuclear Energy .................................................. 9 Commissioner Barrot Urges Action on Sea Motorways ...................................................... 10 Commission Says Slovenian Lisbon Reform Plan Solid, But With Flaws .......................... 11 Commission Assessment of Reform Plan Positive, Officials Say ....................................... 11 Slovenia Receives EUR 59m in Cohesion Funds in 2005 ................................................... 12 Slovenia Receives EUR 59m in Cohesion Funds in 2005 ................................................... 12 MEPs Call on Slovenia, Croatia to Solve Bilateral Issues ................................................... 13 Ministers: Slovenia, Slovakia of One Mind on Schengen ................................................... 13 Rupel Says EU Constitution Not Dead ................................................................................ 13 EU Presidency, Talks With Croatia to Dominate Year for FM ........................................... 14 Central European Labour Ministers Call for Free Flow of Labour ...................................... 15 Rupel Welcomes Plassnik's Call for New Impetus for EU Constitution ............................. 15 LEGISLATION ........................................................................................................................ 16 Companies Bill Comes Under Fire at Public Debate ........................................................... 16 Pluralism at the Centre of Proposed Media Legislation ....................................................... 16 STATISTICS/FORECASTS .................................................................................................... 18 Foreign Tourist Numbers on the Rise, Overnight Stays in Decline ..................................... 18 Business Sentiment Up in January ....................................................................................... 18 Tourism Cash Inflow Up 11% Despite Modest Rise in Tourist Numbers ........................... 18 FINANCE................................................................................................................................. 20 Bajuk Certain Slovenia Will Introduce Euro in 2007 .......................................................... 20 Raiffeisen Krekova Banka Falls Short of Expectations ....................................................... 20 Raiffeisen Krekova Banka Gets New Board Member ......................................................... 20 DARS Clears First Hurdle towards EUR 1bn in Loans ....................................................... 20 Financial Times: Slovenia Edges Closer to Eurozone ......................................................... 21 CCIS Wants Social Agreement Conductive to Economic Growth ...................................... 21 Tax Revenues Up Nearly 18% in 2005 ................................................................................ 22 Ljubljana Stock Exchange .................................................................................................... 22 Foreign Exchange ................................................................................................................. 23 REGIONAL INFORMATION ................................................................................................ 24 Government Says Service Sector the Future for Dolenjsko, Bela Krajina .......................... 24 Government Promises to Back Good Projects in Dolenjsko, Bela Krajina ......................... 24 Slovenia Could Get 12 New Municipalities ......................................................................... 25 BRANCH INFORMATION .................................................................................................... 26 Official: Poultry Sales in Slovenia Normal .......................................................................... 26 Slovenians Change their Favourite Periodical ..................................................................... 26 Transport Minister Says Crucial Transport Link Ready by 2013 ........................................ 26 Flat Tax Disastrous for Tourism Sector, Trade Union Official Warns ................................ 27 Electricity for Households Cheaper in Slovenia than in EU ................................................ 27 COMPANIES ........................................................................................................................... 29 Supervisory Board Confirms Luka Koper's Business Plan .................................................. 29 Hidria's Automotive Arm Plans Double-Digit Growth ........................................................ 29 Krka Posts Double-Digit Profit, Sales Growth .................................................................... 29 PM Praises Krka Operations, Plans...................................................................................... 30 Maos Raises the Stakes Again in Takeover Bid for Iskra .................................................... 30 Shipyard Creditors Endorse Administration ........................................................................ 31 Sostanj Plant Planning Extensive Investment Through 2010 .............................................. 31 SLOVENIA IN BRIEF ............................................................................................................ 32 Stane Granda Named Chair of RTV Slovenija Programming Council ................................ 32 Slovenian Officials Send Condolences Over Montenegro Train Crash ............................... 32 Parliament Halts Re-Incorporation of Vzajemna ................................................................. 32 New Rogaska Boss Wants to Bring the Company Out of the Red ...................................... 32 Government Nominee Elected Chief Supervisor of the Public Broadcaster........................ 32 Government Dismisses State Secretary for European Affairs ............................................. 32 Pelikan Receives Hungarian State Secretary for Minorities ................................................ 32 Copernicus' Masterpiece Found in Ljubljana Library .......................................................... 32 FM Sends Condolences to Poland over Tragic Accident ..................................................... 33 Anzej Dezan to Represent Slovenia at Eurosong ................................................................. 33 2 HEADLINES Terme Catez Plans to Expand its Business The leading Slovenian spa, Terme Catez, is planning several new investments in Slovenia as well as in SE Europe, its director general Mladen Kucis has told STA The leading Slovenian spa, Terme Catez, is planning several new investments in Slovenia as well as in SE Europe, its director general Mladen Kucis has told STA. In one year's time we are planning new investments at all three locations in Slovenia, said Kucis, and added that the company is also considering expanding on the Balkans. Kucis singled out Ilidza in Sarajevo, Bosnia-Herzegovina, as the most likely spa to be upgraded in the near future. Very pleased with Ilidza's business results, Terme Catez decided to expand the swimming and recreational facility with a new hotel, a wellness centre and a new conference centre. According to Kucis, the Ilidza investment, which will be fully operational by the 2007 season, is worth around EUR 15m. Furthermore, Terme Catez plans to build a hotel on the Slovenian coast, near the Portoroz marine, where the number of tourists is expected to rise due to the marine's plans to increase the number of berths. Meanwhile, a mediaeval castle that has been turned into a luxurious hotel is about to re-open, featuring restyled suits and conference halls. Mokrice Castle is located on the SlovenianCroatian border. Additional investments totalling SIT 150m (EUR 630,000) are planned in Catez ob Savi, the seat of Terme Catez, where the outdoor swimming facilities are going to be renovated and an adrenalin park built. Kucis also told STA that the company plans to add new facilities to the already existing 1,800 sq. metres of the largest Slovenian indoor swimming pool facilities, which are open all year round. Having turned into the largest Slovenian spa over the past ten years, Terme Catez boasts 2,000 beds. Seaway's Shipman Again Awarded European Boat of the Year Title Another Slovenian boat, Elan's Impression 344, topped the competition in the category of boats up to 10 metres The sailing yacht Shipman 63, made by the Slovenian company Seaway, has taken the European Boat of the Year honours at the nautics show in Duesseldorf. Another Slovenian boat, Elan's Impression 344, topped the competition in the category of boats up to 10 metres. The Shipman 63, picked among 16 yachts shortlisted in the category of yachts longer than 14 metres, became the successful successor to the Shipman 50 model, which became the overall winner at the prestigious Duesseldorf show in 2004. The 19-metre carbon fibre boat was designed by Jernej and Japec Jakopin. It is the third independent product of the Seaway company (after Shipman 50 and Skagen 50). Seaway sells the vessel under the traditional Scandinavian trademark Shipman, which it acquired in 2003. Costing some EUR 1.5m, six Shipman 63 have been sold so far, making Seaway the world's biggest producer of carbon fibre sailing boats. Seaway is already developing a 22-metre version of the boat, the Shipman 72, which is to be presented this spring. 3 The Bled-based company and their in-house J&J design office is the world's biggest nautical development company. In 22 years of existence it has been responsible for more than 200 projects, which have led to the production of more than 41,000 boats in a total of 20 countries. Amendments to Trade Act Enter into Force The amendments to the trade act entered into force extending the scope of shops that are allowed to remain open on Sundays and bank holidays and raising the surface area of such shops to 200 sq. metres The amendments to the trade act entered into force on Wednesday. 25 January extending the scope of shops that are allowed to remain open on Sundays and bank holidays and raising the surface area of such shops to 200 sq. metres. After being vetoed by the upper chamber in late December, the parliament passed the amendments again in early January, expanding the list of exceptions to the Sunday shopping ban with shops in natural, cultural, historical and ski resorts, at pilgrimage sites and graveyards. The list amends the exceptions as defined in the more restrictive original act which entered into force on 1 January and includes only shops located at petrol stations, city or town centres, marinas, camping sites, spas, hospitals, hotels, airports, border crossings, train and bus stations. Meanwhile, shops selling essential goods can remain open up to ten Sundays a year, regardless of their size. The amendments also abolish the need for retailers to notify the local authorities about their opening hours. Unhappy with the legislative changes, a Slovenian chain of convenience stores asked the Constitutional Court to review the latest amendments to the trade act in late December. Wholesaler and retailer Emona Obala Koper, which operates the Noc in dan 24-hour convenience stores, believes the changes fail to take into consideration the specific nature of convenience stores and discriminate between shops. 4 INTERNATIONAL COOPERATION Slovenian and Croatian Mayors to Form Cross-Border Partnership Mayors of three Slovenian and seven Croatian municipalities signed a letter of intent on cross-border cooperation on the third development axis, which lies between Slovenia's Novo mesto (SE) and Croatia's Karlovac Mayors of three Slovenian and seven Croatian municipalities signed a letter of intent on cross-border cooperation on the third development axis, which lies between Slovenia's Novo mesto (SE) and Croatia's Karlovac, as they met in Metlika on Monday, 23 January. The mayors agreed that signing such a document gives the municipalities the opportunity to stay better informed about the possibilities to draw EU funds, thus giving themselves a better chance to achieve sustainable growth. Mayors of Novo mesto, Metlika and Skocjan and their Croatian counterparts from Karlovac, Duga Resa, Ozalj, Zakanje, Ribnik, Netretic and Kamanje moreover said that by signing the letter, they wanted to raise their living standard and stop negative demographic trends in the area. They also called for closer transport ties, including a new motorway connection between the regional hubs of Novo Mesto and Karlovac, as well as facilitating the already existing economic cooperation and keeping the bordering Kolpa river clean. Slovenia and San Marino Looking to Bolster Cooperation, FMs Say Rupel and Berardi signed a bilateral agreement on international road passenger and cargo transport as part of Berardi's one-day visit to Slovenia The foreign ministers of Slovenia and San Marino, Dimitrij Rupel and Fabio Berardi, respectively agreed that their states should work to bolster ties as they met in Ljubljana on Tuesday, 24 January. Rupel and Berardi signed a bilateral agreement on international road passenger and cargo transport as part of Berardi's one-day visit to Slovenia. According to the two ministers, the agreement is the first in a series aimed at expanding cooperation between Slovenia and San Marino. The two states would like to further their exchange in tourism, culture, education as well as other areas, Rupel and Berardi told the press. One of the priorities is the signing of a convention on the avoidance of double taxation, Berardi added. The pair agreed that relations between the states were trouble-free and good. Rupel said that Slovenia was hoping to work with San Marino on several European projects. The Slovenian foreign minister also told his counterpart that Slovenia would welcome the involvement of enterprises from San Marino in business projects in Slovenia. The pair also exchanged views on international developments and humanitarian issues. Minister Discusses Cooperation with Portuguese Ambassador Environment Minister Janez Podobnik met Portuguese Ambassador to Slovenia Maria do Carmo de Sousa Pinto Allegro de Magalhaes, discussing cooperation between the two countries during their upcoming stints as EU chairs Environment Minister Janez Podobnik met on Tuesday, 24 January Portuguese Ambassador to Slovenia Maria do Carmo de Sousa Pinto Allegro de Magalhaes, discussing cooperation between the two countries during their upcoming stints as EU chairs. 5 Their meeting was mainly centred on facilitating bilateral cooperation, as Slovenia gears up to succeed Portugal as EU chair in the first half of 2008, the Environment Ministry said. The minister and the ambassador moreover discussed cooperation within the international conference of environment ministers (CEMAT) and the Interreg III B balanced regional development programme. The new ambassador presented her credentials to President Janez Drnovsek in October as the first Portuguese ambassador based in Slovenia. Finance Minister Hosts Meeting of Inter-American Development Bank Slovenian Finance Minister Andrej Bajuk hosted a two-day informal meeting between the president of the Inter-American Development Bank Louis Alberto Moreno and representatives of its non-regional members Slovenian Finance Minister Andrej Bajuk hosted a two-day informal meeting between the president of the Inter-American Development Bank Louis Alberto Moreno and representatives of its non-regional members. The meeting took place at Brdo pri Kranju on 25 and 26 January, and was dedicated to reviewing the core activities of the bank. The session on Wednesday, 25 January was preceded by a working dinner that Bajuk hosted for Moreno the previous day. Talks at the dinner focused on the bank's operations, including efforts to reduce poverty and inequality in Latin America and the Caribbean, the Finance Ministry said in a press release on Wednesday, 25 January. Bajuk and Moreno agreed that progress has been made in the core aims of the Inter-American Development Bank, but that more work is needed. The pair stressed that the creation of jobs is the number one priority in tackling poverty. Small and medium-sized companies are particularly important in this respect, they concluded. With its good knowledge of the region, the bank can use its financing mechanism to help countries establish a nourishing business environment, they said. Bajuk said that Slovenia supports in principle the basic aims of the bank. Moreover, he said that he hoped the management of the bank would use the proposals from the meeting for drawing up solutions that would be put to the bank's board of governors at the general assembly scheduled for April, the ministry said. The main aim should be to consider ways of increasing the interest of EU countries in working to reduce poverty in Latin America and the Caribbean with the same vigour as in Africa. Slovenian-Bavarian Commission Unveils Future Cooperation Plans The Slovenian-Bavarian standing commission agreed to facilitate the exchange of experts, students and teachers as well as to organise exhibitions, as it concluded its 25th meeting in Munich The Slovenian-Bavarian standing commission agreed to facilitate the exchange of experts, students and teachers as well as to organise exhibitions, as it concluded its 25th meeting in Munich on Thursday, 26 January. The closing day of the two-day session of the commission promoting relations between Slovenia and the German state was also attended by Slovenian FM Dimitrij Rupel, the Foreign Ministry said. "The Slovenian government places a lot of emphasis on the commission's activities...Regional cooperation presents Europe's connective tissue and that is why the commission's activities are so important," Rupel was quoted as saying. 6 At the margins of the meeting, Rupel met Bavarian Premier Edmund Stoiber, with whom he mainly discussed EU issues, specifically the continued EU expansion and the future of the EU constitution. They agreed that strengthening the dialogue between the EU and its residents is the key to facilitating the connection between the two. Rupel also outlined Slovenia's activities regarding the prospect of EU membership for the Western Balkans states. "Slovenia firmly believes that the countries in the region should not feel isolated," Rupel said. "It is extremely important that a solution for [the future status of] Kosovo is found as soon as possible, especially in the light of the recent death of President Ibrahim Rugova," Rupel believes. Rupel and Stoiber also labelled relations between Slovenia and the German state as favourable, and agreed that economic relations are growing stronger by the year. The foreign minister also met Bavaria's Europe Minister Emilia Mueller, with whom he signed the closing protocol of the conference as well as invited its participants to the commission's next session that is to take place in 2007 in Ljubljana. The permanent Slovenian-Bavarian commission consists of representatives of Slovenian and Bavarian ministries. It discusses cooperation in six different fields. Government Assesses Slovenia's OSCE Chairmanship as Very Successful Slovenia was very successful in revitalising and improving the cooperation within the OSCE, reads the final report on the country's 2005 stint as OSCE chair that the cabinet discussed on 26 January Slovenia was very successful in revitalising and improving the cooperation within the OSCE, reads the final report on the country's 2005 stint as OSCE chair that the cabinet discussed on Thursday, 26 January. Slovenia was additionally quick on its feet in responding to new challenges and tireless in dealing with "frozen conflicts", the government's PR and Media Office wrote in a press release. Moreover, Slovenia can take full credit for the fact that the OSCE adopted its budget, reached an agreement on its secretary general and passed a plan to gradually revitalise and strengthen the Organisation for Security and Cooperation in Europe. By presiding over the 55-strong OSCE, Slovenia presented itself as a "capable partner who can contribute to increased global stability and international cooperation", the government also wrote in its assessment. 7 EUROPEAN UNION Slovenia Greatly Improves EU Fund Drawing Capacity Slovenia has greatly improved its capabilities to draw money from EU cohesion funds in 2005, becoming one of the most successful members of the bloc in doing so Slovenia has greatly improved its capabilities to draw money from EU cohesion funds in 2005, becoming one of the most successful members of the bloc in doing so, Local Government and Regional Policy Minister Ivan Zagar told the press on Monday, 23 January. Out of the SIT 67.5bn (EUR 281m) which were tendered out (representing 86% of all available funds), some SIT 63.1bn (EUR 263m) were allocated by the end of 2005, Zagar said. While at the end of 2004 Slovenia did not send any requests for reimbursements to the European Commission, by the end of 2005 the number of such requests totalled SIT 11.8bn (EUR 49.25m), he added. Moreover, while only 11% of all contracts had been signed in 2004, the number increased to 58% by the end of last year. As the government has already adopted financial measures to optimise the drawing of the funds, "we believe that Slovenia could use up all the available EU funds by the end of the year," Zagar explained. In the current EU budget framework Slovenia is treated as a single cohesion region and will remain as such in the 2007-2013 financial perspectives as well. However, the country is already negotiating with the EU on the country being treated as two cohesion regions in the next EU budget. Barrot Discusses Infrastructure Projects with Transport Minister Addressing a joint press conference, Bozic urged Barrot to support Slovenia's plans in the allocation of funds in the EU's 2007-2013 budget European Transport Commissioner Jacques Barrot discussed Slovenia's priorities and wishes regarding transport infrastructure as he met Transport Minister Janez Bozic on the first day of his two-day visit on Monday, 23 January. Addressing a joint press conference, Bozic urged Barrot to support Slovenia's plans in the allocation of funds in the EU's 2007-2013 budget. Bozic said the numbers were high: EUR 10bn for rail infrastructure, EUR 4bn for motorways and about EUR 3bn for the national road network. "We expect his help," the minister said. Barrot was moreover briefed on the national rail upgrading programme, with talks also touching on proposed changes to the rail transport act, which the ministry has not presented yet. The amendments have prompted media speculations that rail infrastructure management would be transferred from the recently established Agency for Rail Transport to the Slovenian Railways. Barrot stressed that the Commission would insist that the infrastructure and transport entities be separated. He said Slovenia was on track in this field. The commissioner moreover emphasised that the fifth trans-European transport corridor (which features two projects in Slovenia) remains an EU priority although funding for the 2007-2013 period has been restricted in the latest budget deal. According to him, due to a lack of funds projects with a cross-border element would be a priority; Slovenia's key project, the second rail between Divaca and Koper, does not have a cross-border feature. 8 Asked whether this means that the Trieste-Divaca connection, which is favoured by Italy, would then be the priority, Barrot said this issue was raised in talks with Bozic but no agreement has been reached. The Commission will take into account the importance of the port of Koper, which is also taking part in the sea motorways project, he explained. Barrot and MPs on Financial Perspective and Transport Policy Addressing a joint session of the parliamentary transport and EU affairs committees, European Transport Commissioner Jacques Barrot said that the EU spending plan for 200720013 would not allow the launch of all the 30 priority projects of the trans-European transport network (TEN-T) Addressing a joint session of the parliamentary transport and EU affairs committees on Monday, 23 January, European Transport Commissioner Jacques Barrot said that the EU spending plan for 2007-20013 would not allow the launch of all the 30 priority projects of the trans-European transport network (TEN-T). Barrot explained it would be difficult to secure more funds for the transport network and that the limited resources could mean that parts of the cohesion funds would have to be allocated for transport infrastructure projects. He reiterated that the fifth trans-European transport corridor (which features two projects in Slovenia) remains high on the EU agenda, but added that projects with a cross-border element would be a priority. Slovenia's key project, the second rail between Divaca and Koper, does not have a crossborder feature - unlike the rail line between Divaca and Italy's Trieste. According to Barrot, a solution acceptable to both Italy and Slovenia would have to be found. With regard to the port of Koper, Barrot said it had a good chance of being included in the sea motorways project, arguing that ports with good connections would be given priority. Slovenia On Track for Euro Adoption, Austrian Minister Says Presenting Austria's priorities in finance and economy during its stint as EU president in the first half of 2006 in Brussels, Grasser said that Slovenia has good chances of adopting the euro at the beginning of 2007 Slovenia looks good to adopt the euro in 2007 as planned, Austrian Finance Minister KarlHeinz Grasser has told the European Parliament. Presenting Austria's priorities in finance and economy during its stint as EU president in the first half of 2006 in Brussels on Monday, 23 January, Grasser said that Slovenia has good chances of adopting the euro at the beginning of 2007. Estonia and Lithuania, on the other hand, have major problems with inflation, he said, adding that the EU would be very strict in assessing whether the countries fulfil the necessary criteria for eurozone membership. The European Commission and the European Central Bank are scheduled to file their reports on fulfilment of membership criteria later this year, expectedly in June. The final decision on new members must then be taken by the EU Council. Slovenia has had the most difficulty with lowering its inflation to eurozone requirements. It achieved this in December last year and is set to stay within the allowable band throughout this year. EU Survey: Slovenians Favour Solar over Nuclear Energy Over 60% of Slovenians believe that solar energy is the right solution to decreasing the country's dependence on imported energy sources, such as oil and gas, while only 5% said the same for nuclear energy, according to the latest Eurobarometer poll 9 Over 60% of Slovenians believe that solar energy is the right solution to decreasing the country's dependence on imported energy sources, such as oil and gas, while only 5% said the same for nuclear energy, according to the latest Eurobarometer poll. The results of the EU-wide survey published by the European Commission in Brussels on Tuesday, 24 January, also see 42% of Slovenians in favour of researching hydrogen solutions. Meanwhile, 39% believe that wind power could reduce the country's dependency on oil and gas imports, putting Slovenians close to the EU's average. The majority of Slovenians (55%) would not want to see their energy bills going up because of alternative sources, while 26% are ready to pay up to 5% more and 12% are willing to pay up to 10% more for cleaner energy. Also, 44% of Slovenians are willing to reduce their energy usage, while 40% of the country's inhabitants would use their cars less if the price of fuel rose to two euros a litre. A litre of regular unleaded fuel is currently just under one euro. The survey has also shown that the majority of EU residents believe that energy challenges should be primarily dealt with on the European level. Slovenians landed right in the middle on the issue, with 48% of the country's inhabitants supporting energy-related decision making on the EU level. Commissioner Barrot Urges Action on Sea Motorways Two years after the decision on establishing sea motorways within the trans-European transport network (TEN-T), the time has come to take concrete steps, European Transport Commissioner Jacques Barrot told the participants of the first conference on sea motorways in Ljubljana Two years after the decision on establishing sea motorways within the trans-European transport network (TEN-T), the time has come to take concrete steps, European Transport Commissioner Jacques Barrot told the participants of the first conference on sea motorways in Ljubljana on Tuesday, 24 January. The Commission commissioned feasibility studies on sea motorways in 2005 and 2006 and allocated funds for their construction in the 2007-2013 EU budget, Barrot said. "The Commission sees great potential in sea motorways," he added. Moreover, with the land transports set to increase by 70% by 2020, appropriate sea motorways will able to take the bulk of cargo off land transport routes, thereby also helping towards Kyoto obligations, he explained. Meanwhile PM Janez Jansa told the meeting that Slovenia has joined the concept of intermodal transport as well, with the country's national transport strategy emphasising water and rail transports. However, if the Commission wants sea motorways to be successful, it has to work towards better connectability between ports, railway hubs and inland ports, Jansa pointed out. Slovenian Transport Minister Janez Bozic called for cautious implementation of sea motorways, pointing out the need to be careful in choosing sea ports, ensuring suitable transport links between ports and land transport routes, and simplifying administrative procedures. The current EU chair Austria is also aware of the importance of sea motorways, although it is landlocked, said State Secretary at the Austrian Transport Ministry Helmut Kucka. Kucka, who represented Austria's Transport Minister Hubert Gorbach, who has fallen ill, added that Austria will also stress the importance of inland waterways. The conference included 28 delegations from all 25 EU members, the European Commission and accession candidates Bulgaria and Romania. 10 The Slovenian Transport Ministry and the Greek Ministry of Merchant Marine meanwhile signed a memorandum on closer cooperation between the two countries in developing motorways of the sea. The agreement, signed by Bozic and Georg Vlachos, the Greek secretary general for ports and port policy, aims at facilitating cooperation between port operators, transport, logistics and infrastructure companies in both countries. Commission Says Slovenian Lisbon Reform Plan Solid, But With Flaws According to the Commission, which issued its report on the national Lisbon Strategy programmes for the EU member states on 25 January the Slovenian plan has a number of strong sides, but lacks concrete blueprints on certain measures The European Commission has assessed Slovenian plans for implementing reforms related to the Lisbon Strategy as suitable in general, but with a number of flaws. According to the Commission, which issued its report on the national Lisbon Strategy programmes for the EU member states on Wednesday, 25 January the Slovenian plan has a number of strong sides, but lacks concrete blueprints on certain measures. In its opinion of the Reform Programme for the Implementation of the Lisbon Strategy, the Commission calls on Slovenia to prepare better plans for the sustainability of Slovenia's pension system and to come up with a more comprehensive strategy for research and innovation. It found that the reform programme fails to provide a breakdown of budgetary consequences of the proposed measures. Although Slovenia underscores that the success of the reforms depends on support from the EU budget, it fails to draw a clear link between the priority fields and the use of development aid, the report said. The Commission also issued a number of indirect warnings to Slovenia, including that the proposed implementation of a flat tax could raise Slovenia's budget deficit. Among the strong elements of the plan, the Commission points to planned measures to bolster the regulative framework, including through the simplification of legislation and the cutting of red tape. In a breakdown of the goals, the report concludes that Slovenia's aim of adopting the euro in early 2007 is a good basis for the speedy implementation of reforms. On a microeconomic front, the Commission said the plan lacks a timetable of envisaged privatisation measures and efforts to halt abuses of dominant market positions in certain segments of the telecommunications sector. Moreover, the Commission believes Slovenia's ambitious goal of increasing spending on research and development to 3% by 2010 from the 1.64% in 2004 is not realistic and lacks sufficient vision on private partnership. The cabinet adopted the Reform Programme for the Implementation of the Lisbon Strategy in Slovenia in late October and sent it to the Commission soon after. The three-year programme, which all EU member states must draft and submit to the European Commission, is based on reform measures the government is getting ready to implement. Commission Assessment of Reform Plan Positive, Officials Say The Slovenian coordinator for the Lisbon Strategy has said that the key message from the European Commission's assessment of the country's plans for implementing reforms related to the Lisbon Strategy is that the right priorities have been chosen 11 The Slovenian coordinator for the Lisbon Strategy has said that the key message from the European Commission's assessment of the country's plans for implementing reforms related to the Lisbon Strategy is that the right priorities have been chosen. Janez Sustersic said that the Commission's opinion on the Reform Programme for the Implementation of the Lisbon Strategy is fairly positive. He pointed to the Commission's opinion that the period of relatively high economic growth is a suitable time for implementing reforms. Sustersic responded to criticisms that Slovenia's reform plan lacks concrete blueprints on certain measures by saying that Slovenia drafted the plan at a time when the proposed structural reforms were not fully drawn up. He also said that Slovenia would work hard on ensuring the fiscal sustainability of all proposed measures. Sustersic's views were echoed by Bostjan Vasle of the Government Reforms Office. The message is that this is the right time to implement reforms, Vasle told STA. Meanwhile, Slovenia's representatives in the European Commission has said that Slovenia got a positive assessment for its plan compared to other members. European Commissioner for Science and Research Janez Potocnik said that certain elements of Slovenia's reform plan got excellent grades, while some are in need of touch-ups. Slovenia Receives EUR 59m in Cohesion Funds in 2005 At the end of 2005, new EU member states were reimbursed expenses similar to the ones paid to old member states at the end of 2001, said the EU Regional Policy Commissioner Slovenia received EUR 59.37m from four cohesion funds in 2005, according to data published by the European Commission on Thursday, 26 January. At the end of 2005, new EU member states were reimbursed expenses similar to the ones paid to old member states at the end of 2001, said the EU Regional Policy Commissioner. Danuta Huebner added that the Commission has on average "re-paid 20% of all cohesion funds to the new members for the 2004-2006 period". Huebner also assessed the absorption ability of new EU members as overall positive, although she did not provide any additional data. Slovenia Receives EUR 59m in Cohesion Funds in 2005 Out of the total sum, Slovenia received half from the regional development fund (EUR 29.86m), followed by the European Social Fund (EUR 10.1m), with minor amounts also granted through the agriculture structural reform and fishing funds Slovenia received EUR 59.37m from four cohesion funds in 2005, according to data published by the European Commission on Thursday, 26 January. Out of the total sum, Slovenia received half from the regional development fund (EUR 29.86m), followed by the European Social Fund (EUR 10.1m), with minor amounts also granted through the agriculture structural reform and fishing funds. The country also received EUR 17.69 from the cohesion fund, the Commission said. At the end of 2005, new EU member states were reimbursed expenses similar to the ones paid to old member states at the end of 2001, said the EU Regional Policy Commissioner upon presenting the data. Danuta Huebner added that the Commission has on average "re-paid 20% of all cohesion funds to the new members for the 2004-2006 period". Huebner assessed the absorption capacity of new EU members as positive overall, although she did not provide any additional data. She also expressed satisfaction with a "record" year, as structural funds, cohesion fund and pre-accession programmes dished out a total of EUR 33.1bn. 12 The EU's 2007-2013 financial perspectives meanwhile allocate EUR 307bn for 25 EU members and 2 acceding countries, down 10% from Commission's original plans, the Commissioner added. MEPs Call on Slovenia, Croatia to Solve Bilateral Issues The European Parliament called on Slovenia and Croatia to solve bilateral issues in the spirit of good neighbourly relations and mutual respect, as the parliament's foreign affairs committee adopted a draft report of EU expansion The European Parliament called on Slovenia and Croatia to solve bilateral issues in the spirit of good neighbourly relations and mutual respect, as the parliament's foreign affairs committee adopted a draft report of EU expansion in Brussels on Thursday, 26 January. The committee included the call after voting in favour of the amendment by two Socialist MEPs, namely Hannes Swoboda of Austria and Jan Marinus Wiersma of The Netherlands. The document also states that Croatia will have to muster "a lot of effort" if it wants to solve bilateral issues, especially regarding border and property. The European Parliament is expected to take a vote on the report at one of its future sessions. Ministers: Slovenia, Slovakia of One Mind on Schengen Slovenian Interior Minister Dragutin Mate met his Slovakian counterpart Vladimir Palko Slovenia and Slovakia are very much of one mind when it comes to efforts for joining the EU's common border regime, Slovakian Interior Minister Vladimir Palko said on Friday, 27 January in Ljubljana after holding talks with his Slovenian counterpart Dragutin Mate. According to Palko, who was speaking at a press conference with Mate, the two countries share views related to Schengen border system and other EU matters concerning interior affairs. According to Mate, the countries also agree with the EU's stance on illegal and asylum policies, which underscored the importance of tackling the issue in both the source countries and transit countries. "For Slovenia and Slovakia the important thing is that a debate on source countries is not limited to only sub-Saharan Africa but also regions bordering on to the new EU members, including Belarus, Ukraine and the greater Balkans," Mate said. Mate also told the press that he and Palko spoke about their countries' efforts to implement Schengen standards and combat illegal migrations. "We spoke of the importance of promoting bilateral cooperation at an appropriate level. Everything is in place for strong cooperation and an exchange of experience," he added. The pair also agreed on issues that would be discussed at the next Salzburg Forum of Central European interior ministers, a group that Slovakia is chairing in the first half of this year and which Slovenia is going to head in the second half of the year. Rupel Says EU Constitution Not Dead As a country that has already ratified the document, Slovenia would like to see the wording of the document preserved in its current form, although it is aware that the public in certain member states does not support parts of the document, Rupel said In Slovenia's eyes, the EU constitutional charter is by no means dead, Foreign Minister Dimitrij Rupel told the press on Friday, 27 January. As a country that has already ratified the document, Slovenia would like to see the wording of the document preserved in its current form, although it is aware that the public in certain member states does not support parts of the document, Rupel said. Rupel believes an answer must be found on how to make the wording of the document acceptable for all the member states. 13 According to him, finding the right answer to this question will probably take some time and it could very well be Slovenia that would have its hands full with the constitution when it holds the EU presidency in the first half of 2008. Speaking about ideas that the constitution may be implemented in parts, a view advocated foremost by France, Rupel said that it was too early to speak about which parts could be implemented and which ones not. Moreover, Rupel stressed that Slovenia would continue to promote the European outlook of countries of the Western Balkans as one of its priorities in the EU. He said Slovenia would advocate the easing of the EU visa standards for Balkan countries. Travel should be made easier for citizens of these countries, especially the young, scientists and business representatives, he said. EU Presidency, Talks With Croatia to Dominate Year for FM Preparations for Slovenia's stint as EU president in the first half of 2008 and efforts to solve open issues with Croatia will dominate the Foreign Ministry's activities this year, Foreign Minister Dimitrij Rupel has said Preparations for Slovenia's stint as EU president in the first half of 2008 and efforts to solve open issues with Croatia will dominate the Foreign Ministry's activities this year, Foreign Minister Dimitrij Rupel has said. Outlining the ministry's priorities for the year at a press conference on Friday, 27 January, Rupel said that 2006 was expected to be a busy year for him and his team. Apart from the EU and Croatia, the ministry will also work on raising Slovenia's international development aid and drafting around 35 pieces of legislation, Rupel said. According to him, two ministry-sponsored bills have already been filed for parliamentary passage: the bill on participation in international civilian missions and international organisations, and the bill on international development cooperation. As regards Croatia, Rupel believes that the year will see a continuation of efforts aimed at reaching bilateral agreements on open issues. "The period of Croatia's accession to the EU is a good opportunity to resolve open issues, including that on the border," he reiterated. The border will not be the only issue on the agenda, as the two countries also need to discuss ways to resolve the Croatian blockade of Slovenian banks, Croatia's failure to establish a fund for the decommissioning of the jointly-owned Krsko Nuclear Power Plant and other issues related to red tape preventing companies from doing business, he said. Rupel said that Slovenia would like to see Croatia wrap up talks with the European Commission on fisheries as soon as possible so that the fishing provisions of the accord the two countries have on cross border cooperation can be implemented, thereby facilitating maritime fishing in both countries. Moreover, Rupel stressed that Slovenia was not shying away from arbitration, but that it believes all avenues of bilateral negotiations must be exhausted before the assistance of the third party is sought. The foreign minister said Slovenia would continue to be an active player in international organisations. Among other things, the country will adopt an active role in UN reform efforts, he said. According to him, Slovenia will continue striving to be given membership in the Organisation for Economic Cooperation and Development (OECD). Slovenia intends to increase its spending on international aid from the current 0.1% to 0.17% of GDP, he said, adding that this would coincide with President Janez Drnovsek's global appeal for the western Sudanese region of Darfur. 14 Rupel announced that the year would be busy as far as foreign visits go: PM Janez Jansa is scheduled to visit Germany, the US and Russia, among others; Slovenia is to be visited by Ukrainian President Victor Yushchenko, as well as high-level Thai, Indian and Pakistani officials. Central European Labour Ministers Call for Free Flow of Labour Labour Ministers of five Central European EU members coordinated efforts to convince old EU members to lift restrictions for workers from the EU newcomers Labour Ministers of five Central European EU members, including Slovenia's Janez Drobnic, coordinated efforts to convince old EU members to lift restrictions for workers from the EU newcomers as they met in Budapest on Friday, 27 January. After talks with his counterparts from the Visegrad group (the Czech Republic, Hungary, Poland and Slovakia), Drobnic told STA that he emphasised the importance of maintaining good control over migrations. It is important that all countries carry out good monitoring, as this is the best way to alleviate fears that exist in certain places regarding workers from the newcomers, the minister said after the meeting. He said Slovenia shared the view of the Visegrad Group that there must be an EU-wide free flow of labour, which would increase employment, reduce unemployment and have an overall beneficial impact on the economy. Drobnic acknowledged fears that exist in certain EU member states, but added that there are encouraging hints from several countries which may decide to open their labour markets. Slovenia has had and will have a number of bilateral agreements focusing on this issue, including with Austria, Finland and Portugal, Drobnic explained. Finland and Portugal are often mentioned as countries that might lift the restrictions after the expiry of the first two-year period on 1 May, but Austria and Germany are more reserved. Restrictions on free flow of labour (imposed by all but three old EU members) for eight Central and Eastern European EU newcomers can be in force for no more than seven years. Rupel Welcomes Plassnik's Call for New Impetus for EU Constitution In a letter sent to Plassnik, Rupel said that the constitution was very much alive, given that it has been ratified by more than half of the EU member states Foreign Minister Dimitrij Rupel has welcomed Austrian Foreign Minister Ursula Plassnik's idea that fresh impetus be injected in the debate on the EU constitution. In a letter sent to Plassnik on Friday, 27 January, Rupel said that the constitution was very much alive, given that it has been ratified by more than half of the EU member states. A large number of the member states, among them Slovenia, identifies closely with this document, Rupel said in the letter to Plassnik, according to a press release from the Foreign Ministry. His comments come in response to a letter Plassnik - whose country currently holds the rotating EU presidency - recently sent to EU foreign ministers in which she calls for fresh impetus for the constitution. According to the Slovenian foreign minister, the EU needs a document that will set down common values and facilitate decision making and thus allow the EU to become a global player. The current draft constitution largely achieves this goal, Rupel said, adding that he was convinced that European politicians must work to bolster the trust of the citizens in the European project. 15 LEGISLATION Companies Bill Comes Under Fire at Public Debate The companies bill, which will completely replace the oft-amended 1993 companies act, has over 700 articles and deals with all aspects of corporate law Provisions of the companies bill that deal with co-determination came under fire on Thursday, 26 January as the parliament hosted a public debate on the comprehensive bill. Many participants voiced the concern that employees would be completely excluded from decisionmaking in companies with a single-tier management system. Rajko Bakovnik of the Association of Works Councils echoed the concerns of many by saying that the proposed provisions on co-determination would practically eliminate the practice, as workers would no longer have any say on supervisory tasks and keep a say in management in only a handful of big companies. Additionally, former interior minister Rado Bohinc was sceptical about the solution whereby the independence of the board members would be governed by a code of conduct. He believes that corporate culture in Slovenia is insufficiently developed, so this should be governed by law. Similarly, several participants thought it would be better if co-determination was governed by a special law. MP Dusan Kumer of the Social Democrats (SD), which launched the initiative for the debate, said that the party had already filed the relevant bill in parliament procedure. Economics Minister Andrej Vizjak, whose ministry drafted the bill, explained that a compromise solution on co-determination was already in the making. The ministry will thus propose that one in three members of the board of directors be a representative of the works council. Vizjak also rebuffed concerns regarding the supervisory function of the board, saying that the single-tier board of directors cannot be equated with the roles of the supervisory and management boards in a two-tier system. Borut Bratina of the Maribor Faculty of Business and Economy meanwhile said that the bill was modern and efficient, as it takes into account all the necessary components and includes EU guidelines and recommendations. The companies bill, which will completely replace the oft-amended 1993 companies act, has over 700 articles and deals with all aspects of corporate law. According to plans, parliament is to pass it at the regular session in February. Pluralism at the Centre of Proposed Media Legislation The Culture Ministry has drafted changes to the media act that envisage "effective" penalties for breaches of media concentration rules and funding of media pluralism projects as well as stricter censorship standards for pornography and violence The Culture Ministry has drafted changes to the media act that envisage "effective" penalties for breaches of media concentration rules and funding of media pluralism projects as well as stricter censorship standards for pornography and violence. Publishing the proposed changes on the government's website, the Culture Ministry said that the legislation would introduce changes to the funding of media in a bid to promote pluralism. Pluralism is also the aim of proposed provisions for "effective" penalties for breaches of media concentration rules - all ownership of media above 20% must get prior consent from the Culture Ministry. The changes set down that the Culture Ministry would appoint a task force to decide on media projects that should be awarded state aid aimed at promoting media pluralism. 16 The commission would make its decisions based on the importance of the project for public interest and the results of annual studies on the state of media pluralism in Slovenia, the ministry explained. The state aid will be intended for financing content of informational printed, television, radio and electronic media outlets. Money will also be set aside for local and non-profit media. The ministry said current legislation does not provide for effective penalties for violations of anti-concentration provisions of the media law. This is why it has proposed a provision which says that any decision aimed at raising ownership in a media outlet above 20% without the prior consent of the Culture Ministry would automatically be rendered null and void. Moreover, the new legislation would introduce stricter censorship rules: pornography and violence that "could seriously affect the psychological, moral or physical development of children and youth" would be banned, except for between midnight and 5 AM, when an appropriate warning would have to be aired. Media outlets would also have to form censorship codes with which they would set standards for the airing or publishing content involving sexually explicit material or violence. 17 STATISTICS/FORECASTS Foreign Tourist Numbers on the Rise, Overnight Stays in Decline Despite a rise in the number of tourists that visited Slovenia in 2005, the number of their overnight stays dropped by 1% to 7.5 million, according to the preliminary data presented by the Slovenian Tourist Board (STO) Despite a rise in the number of tourists that visited Slovenia in 2005, the number of their overnight stays dropped by 1% to 7.5 million, according to the preliminary data presented by the Slovenian Tourist Board (STO) on Tuesday, 24 January. The cold and rainy summer hit the country's camping sites particularly hard, as they witnessed an over 6% drop in all tourists in comparison with 2004, STO general manager Barbara Guncar told the press in Ljubljana. The problems were compounded by an exceptionally rainy August, which otherwise accounts for the bulk of overnight stays in Slovenian coastal and mountain resorts, Guncar added. Moreover, new and cheaper tourist destinations, such as Bulgaria, Romania and Turkey, are opening up, while Slovenia still remains relatively unknown in the EU, said Jernej Zajec of the STO. Nevertheless, preliminary data shows the number of total guests to Slovenia at 2.38 million in 2005, up 2% year-on-year, explained Zajec, the head of STO's market research and analysis department. While 1% less tourists visited seaside and mountain resorts, Ljubljana and its surroundings experienced a tourist boom with a 12% rise in the number of guests coming to the capital in 2005, Zajec added. According to preliminary data, Italians top the list of foreign visitors (19.5%), followed by Germans (15.9%), Austrians (15.4%) and British (7.2%). The STO is also set to continue with its promotional campaigns, presenting the country on various TV stations and in the National Geographic Magazine, Majda Dolenc of the STO's foreign PR and media office said. Business Sentiment Up in January Business sentiment rose 3 percentage points in January, with rises in consumer confidence and confidence in manufacturing as well as in the retail sector Business sentiment rose 3 percentage points in January, with rises in consumer confidence and confidence in manufacturing as well as in the retail sector. The seasonally adjusted value of the manufacturing confidence index was 1 percentage points higher in January than in December and 7 percentage points above where it was at the same time last year, according to data from the Statistical Office. Meanwhile the confidence index in retail rose 3 percentage points over December. Compared to January last year, it was 9 percentage points higher, the office said on Wednesday, 25 January. Consumer confidence index, however, skyrocketed in January, rising 10 percentage points over December last year, mainly due to optimistic expectations about the general economic situation in the country over the next 12 months. Tourism Cash Inflow Up 11% Despite Modest Rise in Tourist Numbers According to preliminary data, Italians topped the list of foreign visitors (19.5%) in 2005, followed by Germans (15.9%), Austrians (15.4%) and Britons (7.2%) 18 The foreign currency inflow from tourism increased by 11% in 2005, standing at some EUR 1.45bn, preliminary data shows. The Slovenian Tourism Board (STO) believes the growth is proof that Slovenia is developing tourism products with higher value added. The rise in foreign currency inflow comes despite only a modest rise in the number of tourists that visited Slovenia in 2005 and a 1% decrease in the number of total overnight stays (7.5m) generated by tourists. Commenting on the preliminary data on currency inflow from tourism, STO general manager Barbara Guncar said: "Slovenian tourist sites are obviously attracting tourists that spend more." According to preliminary data, Italians topped the list of foreign visitors (19.5%) in 2005, followed by Germans (15.9%), Austrians (15.4%) and Britons (7.2%). 19 FINANCE Bajuk Certain Slovenia Will Introduce Euro in 2007 According to the Slovenian central bank, Slovenia, which met all Maastricht convergence criteria at the end of 2005, is not likely to have any major difficulties in the run-up to the euro changeover because it can rely on a stable domestic economy Slovenia will change over to the common European currency as planned on 1 January 2007, with or without anybody else, Finance Minister Andrej Bajuk said at the fringes of a meeting of EU finance ministers in Brussels on Tuesday, 24 January. "I would be pleased if Estonia and Lithuania make it as well, however, our changeover does not depend on anybody," Bajuk stressed. Bajuk's optimism was fuelled by his Austrian counterpart Karl Heinz Grasser, who said that out of the three common-currency hopefuls only Slovenia has "good prospects". According to the Slovenian central bank, Slovenia, which met all Maastricht convergence criteria at the end of 2005, is not likely to have any major difficulties in the run-up to the euro changeover because it can rely on a stable domestic economy. Raiffeisen Krekova Banka Falls Short of Expectations Raiffeisen Krekova Banka (RKB), the Slovenian subsidiary of the Austrian banking group, increased its total assets by 36.9% to SIT 218.3bn (EUR 911m) in 2005 Raiffeisen Krekova Banka (RKB), the Slovenian subsidiary of the Austrian banking group, increased its total assets by 36.9% to SIT 218.3bn (EUR 911m) in 2005. However, with a loss of SIT 876,8m (EUR 3.7m) the bank's performance remained bellow expectations, RKB said in a press release on Wednesday, 25 January. While in 2005 the bank increased its market share in loans to individual customers to 5.5%, it also maintained its leading role in marketing foreign investment funds in Slovenia. Finishing 2005 with a 3.1% market share, RKB said it wanted to increase its stake to 5% in the coming five years. It also announced it would offer five new foreign investment funds after it is given green light by the Securities Market Agency. Raiffeisen Krekova Banka Gets New Board Member Marko Klemencic will become a new board member in charge of IT and banking operations at Raiffeisen Krekova Banka Marko Klemencic will become a new board member in charge of IT and banking operations at Raiffeisen Krekova Banka, a small Austrian-owned bank, after having been cleared by the central bank. Effective on 1 February, Klemencic will succeed David R. Halstead, who will stay on as adviser to the management board, the bank wrote in a press release on Thursday, 26 January. Klemencic has previously been the head of the IT and organisation department at insurance company Zavarovalnica Maribor. The bank's chairman Zoran Nemec was quoted as saying that Klemencic was an expert on IT, but his expertise on insurance products and quality control will also be invaluable. Raiffeisen Krekova banka, Slovenia's ninth largest bank by assets, is owned by the Austrian banking group Raiffeisen International. DARS Clears First Hurdle towards EUR 1bn in Loans The parliament's committee on finance and monetary policy has endorsed a bill on state guarantees for the Motorway Company (DARS), which allows the company to take out stateguaranteed loans in excess of one billion euros until 2010 20 The parliament's committee on finance and monetary policy has endorsed a bill on state guarantees for the Motorway Company (DARS), which allows the company to take out stateguaranteed loans in excess of one billion euros until 2010. The bill was given the go-ahead despite protests by opposition MPS, who doubt DARS would even be able to repay the loans. Finance Minister Andrej Bajuk told MPs that the loans were necessary because of lack of budget funds, the decision to speed up motorway construction in Pomurje in the east, and insufficient takings from toll collection. According to him, the bill must be fast-tracked to ensure funding sources in due time and because the situation on the international financial markets is very favourable at the present. Addressing the opposition's concerns about excessive indebtedness, Bajuk also said DARS would have to beef up toll collection, as only 64% of all potential toll is now collected. The opposition was also concerned that the faster pace of motorway construction would undermine the project of the third development axis, which would link Korosko in the north and Dolenjsko in the southeast with Austria and Croatia via a north-south corridor. According to Bajuk, this project could be part financed through public-private partnership and EU funds. If the bill is signed into law, DARS will be able to phase in the loans until 2010. The money would be used for 25 new motorway sections and the maintenance of existing motorway infrastructure. Financial Times: Slovenia Edges Closer to Eurozone "Slovenia's state of readiness is rare among would-be eurozone members," the Financial Times daily wrote on 27 January, stressing that Slovenia might be the only of the euro changeover candidates to join next January "Slovenia's state of readiness is rare among would-be eurozone members," the Financial Times daily wrote on Friday, 27 January, stressing that Slovenia might be the only of the euro changeover candidates to join next January. The business daily adds that "Estonia's and Lithuania's chances of joining with Slovenia have been setback by a sudden burst of energy-related inflation". "It is not up to us now... What we had to do, we have more or less done," Mitja Gaspari, the governor of Slovenia's central bank told the London-based daily. Moreover, Slovenia's success is the "the result of long-running coordination between fiscal and monetary policy", Gaspari added. The daily also observes that Slovenia's geographic position, bordering Italy and Austria, made it easier for the country to make the transition to capitalism. Indeed, "ours was a softer form of socialism than in many other places in Europe", Gaspari told the Financial Times. The daily also believes that "Slovenia should meet comfortably the main criteria for eurozone membership". It writes about last week's hint by Austria's Finance Minister Karl-Heinz Grasser, who said that the country would get the go-head later this year to start the last technical preparations for eurozone entry in January 2007. CCIS Wants Social Agreement Conductive to Economic Growth The Chamber of Commerce (CCIS) intends to enter talks on the 2006-2009 social agreements with the position that the deal must be conductive to dynamic economic growth based on improved competitive ability and new job-creating investments 21 The Chamber of Commerce (CCIS) intends to enter talks on the 2006-2009 social agreements with the position that the deal must be conductive to dynamic economic growth based on improved competitive ability and new job-creating investments. Such growth will improve social security, reduce social risks for the most vulnerable groups and improve the overall quality of life, CCIS officials told the press on Friday, 27 January as they unveiled their standpoints for the upcoming talks. According to the CCIS, the agreement must pave the way towards an annual inflation rate of below 2%, the reduction of government spending by 3 percentage points until 2009, and a gap between wage and productivity growth of 1 percentage point at least until eurozone entry. The document moreover calls for increased R&D spending, a simplification of labour regulations, a flexible labour market, reduced administrative costs for foreign and domestic investors, and the promotion of domestic companies' penetration of foreign markets. Joze Smole, adviser to the CCIS president, noted that the social partners had always managed to sign social agreements, so it is possible to reach a consensus. He said the companies in particular want a stable business environment. The social agreement is not binding, but it represents a crucial consensus on key issues; economic and social development is better if it is consensus-based, added another adviser to the CCIS president, Marjan Siraj. Smole pointed out that the corporate sector largely accepts the government standpoints for the negotiations. However, it is not only a question of which proposals the CCIS will endorse, it is crucial how they will be implemented. CCIS therefore urges special caution in changes to tax laws: a flat tax rate would be devastating for certain sectors, as the phasing out of the payroll tax will not create reserves to offset the effects of higher VAT. Tax Revenues Up Nearly 18% in 2005 The Tax Administration (DURS) collected, according to its preliminary figures, SIT 2,290.8bn (EUR 9.56bn) in taxes in 2005, a rise of 17.9% over 2004, exceeding the annual targets by 6.6% The Tax Administration (DURS) collected, according to its preliminary figures, SIT 2,290.8bn (EUR 9.56bn) in taxes in 2005, a rise of 17.9% over 2004, exceeding the annual targets by 6.6 %. DURS moreover collected an additional SIT 5,212bn (EUR 21.7bn) in revenues which are not part of the public finance scheme, namely certain membership fees and contributions, DURS told STA. DURS channelled SIT 1,068.9bn (EUR 4.46bn) into the national budget last year, a rise of as much as 34.7% over 2004. The surge should be attributed mainly to the changes to tax legislation following Slovenia's EU entry, which influenced the amount of collected VAT. Moreover, SIT 185.3bn (EUR 773m) was paid into municipal budgets, which is 4.4% more than a year before. The Institute of Pension and Disability Insurance (ZPIZ), meanwhile, received SIT 619.8bn (EUR 2.6bn), up 6.1%, and the Health Insurance Institute SIT 416.8bn (EUR 1.7bn), up 7.5%. The final figures should be released at the end of February. Ljubljana Stock Exchange The SBI 20 benchmark index gained 30.23 points (0.65%) on the back of a record-breaking week by pharmaceutical company Krka The SBI 20 benchmark index gained 30.23 points (0.65%) on the back of a record-breaking week by pharmaceutical company Krka. 22 The trading week was among the busiest this year, as SIT 7.33bn (EUR 30.59m) worth of stocks changed hands, including SIT 3.42bn (EUR 14.27m) in block deals. Boosted by news that its profit surged over 50% last year, Krka gained 4.85% to close the week at SIT 115,317 (EUR 481.29), with some deals reaching an all-time high of SIT 116,000 (EUR 484.14). Among the big names, retailer Mercator added 0.45% to SIT 37,482 (EUR 156.44) and fuel trader Petrol was up 0.4% to SIT 70,924 (EUR 296.01). Along with Krka, the other star of the week - albeit in paper-thin volumes - was conglomerate Autocommerce: in barely its first week of trading, the share gained 33.4% to SIT 8,466 (EUR 35.33), twice hitting the 10% ceiling for maximum daily gains. On the free market, shares of investment fund NFD 1 gained 2.23% to SIT 308.93 (EUR 1.29) to lead the PIX investment fund index 67.89 points (1.71%) higher to 4,038.91. Meanwhile, the BIO bond index was up 0.07 points (0.06%) to 121.84. Foreign Exchange Mean exchange rate of the Bank of Slovenia Euro (EUR) - SIT 239.58 (0.00) U.S. dollar (USD) - SIT 196.8 (-1.66) Swiss franc (CHF) - SIT 154.24 (-0.24) British pound (GBP) - SIT 349.55 (+0.1) 23 REGIONAL INFORMATION Government Says Service Sector the Future for Dolenjsko, Bela Krajina Due to the potential of services, which hold the promise of faster growth, the government intends to support small and medium-sized enterprises, Economics Minister Andrej Vizjak told the press as part of the government's visit to the region The government has said that services are the future for the southwestern regions of Dolenjsko and Bela krajina, which rely heavily on manufacturing, although labour-intensive industries should not be written off just yet but rather look for new programmes. Due to the potential of services, which hold the promise of faster growth, the government intends to support small and medium-sized enterprises, Economics Minister Andrej Vizjak told the press as part of the government's visit to the region on Wednesday, 25 January. The government's main task would be to provide the appropriate transport infrastructure, notably a new expressway linking Bela krajina with the Dolenjsko administrative centre of Novo mesto, which will facilitate commuting, he explained. This connection forms part of what is called the "third development axis," a north-south route linking the region via expressway/motorway with Austria and Croatia, which is to be completed by 2014 at the latest, Transport Minister Janez Bozic said. Road construction is already underway in the region: some 70 projects are being carried out (mostly sections of motorway) worth about SIT 16.5bn (EUR 68.9m). A total of 6.3 km of new motorway sections are to open for traffic this year. Prime Minister Janez Jansa meanwhile noted the large discrepancies in unemployment in the region: while there is demand for workers in Novo mesto, Semic and Crnomelj are struggling with high unemployment. Jansa was quick to point out that the government would not "mix development and social funds" like the previous governments did: labour intensive industries must find new programmes, he stressed. Meanwhile, Vizjak talked to STA about talks that PM Jansa and several ministers had at Renault-owned car maker Revoz. In addition to producing the successor to the popular compact Twingo, the assembly plant wants to win the production of another model and venture into used-car recycling, Vizjak said. The minister said he had also urged Renault executives to source more car parts in Slovenia, which should happen when production of the new model starts. Government Promises to Back Good Projects in Dolenjsko, Bela Krajina Some municipalities have already taken advantage of development opportunities, but there is still plenty of room for growth in services and tourism, PM Jansa told mayors from the two regions Prime Minister Janez Jansa has promised that the government would back good projects in Dolenjsko and Bela krajina. Some municipalities have already taken advantage of development opportunities, but there is still plenty of room for growth in services and tourism, Jansa told mayors from the two regions on Wednesday. 25 January. Addressing the local mayors as part of the government's tour of the two regions, Jansa said the companies that the ministers visited were embarking on realistic development projects which the government supports. The prime minister also pointed to the specific economic structure in the regions, with many big and well-performing corporations on the one hand, and severe unemployment, especially in Bela krajina, on the other. 24 He believes a better transport link between Dolenjsko and Bela krajina would go a long way towards bridging these development gaps. Moreover, according to him the loss of jobs in labour-intensive industries could be offset with new jobs in services and tourism. The government would therefore support small and medium-sized enterprises, including with the help of EU funds, but it expects the local communities to come up with good projects. Jansa highlighted the region's traditional textile industry as the sector with the worst development prospects, a view echoed by Economics Minister Andrej Vizjak, who said textile companies would get aid only on the basis of concrete programmes. Slovenia Could Get 12 New Municipalities According to unofficial results of a consultative referendum held in several different parts of the country, voters backed at least 12 new municipalities on 29 January on a turnout of around 60% According to unofficial results of a consultative referendum held in several different parts of the country, voters backed at least 12 new municipalities on Sunday, 29 January on a turnout of around 60%. The official results are expected to be released on 7 February and would act as a guide for the cabinet in drafting changes to legislation that would establish new municipalities. However, the results are not be binding for parliament. Voters were against two would-be municipalities (Ankaran-Hrvatini; Bizeljsko), whereas the majority in the area of Rimske Toplice was in favour of a new municipality, yet the same municipality was opposed by the people of Zidani Most. The division of the Dobrova-Polhov Gradec municipality into two municipalities was back only by the people of Dobrova, while those in Polhov Gradec were against. In line with legislation, each of the new 12 would-be municipalities would have more than 2,000 inhabitants, yet less than 5,000. The referendum was called by parliament in early December as the first in a series of steps required to establish new municipalities. The debate on new municipalities comes ahead of local elections scheduled for this autumn. All the procedures related to their establishment need to be completed by 25 March if the new municipalities are to be included in this year's local elections. Slovenia has 193 municipalities, a number regarded as rather high given its relatively small size and population of around 2 million. 25 BRANCH INFORMATION Official: Poultry Sales in Slovenia Normal In the first months after the outbreak of bird flu in Turkey and Romania, Slovenia recorded a slight drop in poultry sales; however, the situation has since normalised In the first months after the outbreak of bird flu in Turkey and Romania, Slovenia recorded a slight drop in poultry sales. However, the situation has since normalised, Agriculture Ministry State Secretary Franci But said on the margins of a meeting on Monday, 23 January of EU agriculture ministers meeting in Brussels. Agriculture Minister Marija Lukacic added the recovery should be attributed to a successful public awareness campaign on the issue. Lukacic also announced that Slovenia would prepare a detailed analysis until the next meeting on 20 February when the minister plan to return to the issue of economic implications of a bird flu epidemic and propose measures if needed. Italy, arguing it already felt the economic effects of dropping poultry prices, urged the participants of the meeting to provide adequate support for the poultry industry. "We agreed that closer cooperation is needed," said But, adding that the EU has already sent its experts to Turkey and that Slovenia has also offered to participate in such efforts. The state secretary stressed that Slovenia has adopted all the relevant measures proposed by the EU in guarding against a bird flu outbreak. Measures proposed at the meeting on Monday, 23 January include stricter controls of air passengers coming from risk countries and an extension until May 2006 of the import ban of live birds introduced in October 2005. Slovenians Change their Favourite Periodical Slovenske novice remains the most popular daily Nedeljski Dnevnik, a separate tabloid-style edition of the daily Dnevnik, was the most widely read Slovenian weekly periodical in the second half of 2005, a survey shows. The national readership survey, commissioned by the Advertising Chamber, saw Nedeljski Dnevnik gaining a small advantage over the TV guide Vikend, which comes out as a supplement of broadsheet Delo and tabloid Slovenske novice. Meanwhile, Slovenske novice remains the most popular daily, taking fifth place overall, out of the 164 periodicals surveyed in the half-yearly poll. Also on the rise is the popularity of religious papers, namely the monthly Ognjisce and the weekly Druzina, while among publishers, the Dnevnik publishing house has made the largest gains. However, two newcomers have made it to the top 10 most widely read periodicals in Slovenia, with the free weekly Zurnal in 9th spot and the religious weekly Ognjisce 10th. Andraz Zorko of the Cati agency, which surveyed 18,500 respondents aged between 10 and 75 years, said the results showed no significant changes, with readership numbers remaining stable in comparison with past periods. Transport Minister Says Crucial Transport Link Ready by 2013 Transport Minister Janez Bozic has told officials of the Dolenjsko region that the ministry has issued an initiative to start drafting the zoning law for the third development axis, a crucial north-south transport link to Austria and Croatia 26 Transport Minister Janez Bozic has told officials of the Dolenjsko region that the ministry has issued an initiative to start drafting the zoning law for the third development axis, a crucial north-south transport link to Austria and Croatia. Bozic told STA after a meeting on Wednesday, 25 January that there were great expectations in Dolenjsko with regard to the third development axis, and added he was optimistic as the region's representatives understood the state was doing everything in its power to get this priority project going as soon as possible. He noted that preparing such a demanding project, which would also link Dolenjsko to neighbouring Bela krajina, takes time. Yet he found the discussed timetable - setting 2010 as the beginning of construction - fairly realistic. Bozic said that the third development axis project should be completed by 2013 or 2014 at the latest. According to him, the connection between Novo mesto and Bela krajina will be the first step of the project. The following steps would be determined according to circumstances given at the time. The money for the project, given priority status in the EU's 2007-2013 spending plan, is to come from multiple sources, notably from state and EU funds. Bozic stressed that everyone has to be aware of the importance of the project, so that "no additional delays occur". Bozic's talks were part of the government's visit to Dolenjsko and Bela krajina. Flat Tax Disastrous for Tourism Sector, Trade Union Official Warns A representative of the Catering and Tourism Union has claimed that the introduction of flat tax in Slovenia would have disastrous effects for the tourism and catering sector A representative of the Catering and Tourism Union has claimed that the introduction of flat tax in Slovenia would have disastrous effects for the tourism and catering sector. At least 1,500 jobs would be lost as a result, Karmen Leban said. Leban told the press on Thursday, 26 January that the introduction of flat tax, which would subsequently abolish a reduced VAT rate for food and beverages, would increase the tax burden on the tourism and catering sector by SIT 14.3bn (EUR 59.7m) a year. The results of this would be mass layoffs and a rise in the number of undeclared workers, Leban said. All the calculations suggest that the introduction of a 20% or even 17% rate of VAT would have catastrophic effects for tourism in Slovenia, she explained. Flat tax will lead to layoffs, particularly of well-qualified workers, while companies will start to hire cheap labour or even resort to undeclared workers in a bid to cut costs, she said. Moreover, given the low wages in the tourism sector, workers would have no benefit from a flat tax, either. Leban said that the increases of VAT rates in Portugal, Netherlands and Ireland in the past have demonstrated the negative effects that this has for tourism and catering sector. Electricity for Households Cheaper in Slovenia than in EU The price of electricity for households in Slovenia is 25% below the EU average, according to the National statistics office The price of electricity for households in Slovenia is 25% below the EU average, according to the National statistics office. The countries which have even lower electricity prices are the Czech Republic, Malta, Poland, Estonia, Greece, Latvia and Lithuania, whereas the most expensive electricity is paid by the Danes. Netherlands has the most expensive regular unleaded fuel in the bloc, with Slovenia still in the group of countries with the lowest fuel prices. The situation is similar for diesel, according to Slovenia's Statistical Office. 27 Oil derivatives are the most widely spread source of energy in Slovenia, representing 47% of all energy used, followed by electricity and natural gas. The greatest share of energy is used in transport (29%), followed by manufacturing and the construction sectors (28%), with households using a quarter of all energy. Oil derivatives, with 35%, are also the most heavily used source of energy in households. Renewable sources of energy, chiefly wood, come second with 26% and are followed by electricity with 21%. Just like the EU, Slovenia imports around half of all the energy it needs. 28 COMPANIES Supervisory Board Confirms Luka Koper's Business Plan In line with the plan, Luka Koper expects revenues to rise by 3% over 2005, reaching SIT 20.8bn (EUR 86.81m), while the operating profit is planned at SIT 3.5bn (EUR 14.6m The supervisory board of Slovenia's sole port operator, Luka Koper, confirmed the company's business plan for 2006, the company said on Monday, 23 January. In line with the plan, Luka Koper expects revenues to rise by 3% over 2005, reaching SIT 20.8bn (EUR 86.81m), while the operating profit is planned at SIT 3.5bn (EUR 14.6m). The estimated rise in profits reflects the expectation about the continuation of positive trends in international trade, with the company expecting to ship 1% more cargo in 2006 than in 2005. "We want to expand our operations, especially in containers, cars and general cargo," as well as improve our cooperation with other logistics companies, Luka Koper explained. The business plan for 2006 also sets down investments totalling SIT 6.2bn (EUR 25.87m), mainly into the construction of warehouses for general cargo and into the equipment to transport containers and other cargo. Also planned are environmental investments, such as an anti-dust sprinkler system at the coal transfer facility, and technological solutions regarding granular cargo. Hidria's Automotive Arm Plans Double-Digit Growth Rotomatika and AET, which together with Tomos make up the automotive arm of manufacturing conglomerate Hidria, plan double-digit sales growth this year on buoyant demand Rotomatika and AET, which together with Tomos make up the automotive arm of manufacturing conglomerate Hidria, plan double-digit sales growth this year on buoyant demand. Rotomatika, a maker of electrical-engine parts and aluminium casts, expects sales to rise 15% to EUR 85m, with AET projecting sales of EUR 22.2m, up 11% year-on-year, company officials told the press on Monday, 23 January. Moreover, Rotomatika director general Dusan Lapajne hopes shipments to the car industry would account for 30% of the company's sales in five years, up from 15% at the present. AET, a leading producer of glow plugs for diesel engines, is meanwhile busy constructing a new R&D centre worth EUR 6m, which is to be launched in 2008, said director general Zivko Kvas. The executives were attending the unveiling of the new Renault Megane; Renault is one of their biggest customers. Krka Posts Double-Digit Profit, Sales Growth Pharmaceutical company Krka saw profits surge 53% to SIT 21.6bn (EUR 90.16m) in 2005 on sales of SIT 116.8bn (EUR 487.52), up 19% year-on-year, the company's preliminary, unaudited results suggest Pharmaceutical company Krka saw profits surge 53% to SIT 21.6bn (EUR 90.16m) in 2005 on sales of SIT 116.8bn (EUR 487.52), up 19% year-on-year, the company's preliminary, unaudited results suggest. The Krka Group sales topped SIT 133.5bn (EUR 557.22), growing 18% over 2004. According to preliminary estimates, the group net profit will not significantly deviate from the core company's net profit, the company said in a press release on Tuesday, 24 January. 29 The results, which were reviewed by the company's supervisory board on Monday, 23 January, have exceeded performance targets, chief executive Joze Colaric was quoted by the company as saying. Slovenia accounted for 15.7% of the sales, with Krka maintaining its position as the leading pharma company with a 16% market share. Sales in Southeast Europe were worth SIT 20bn (EUR 83.48m), 17% of total sales, while sales in Eastern Europe totalled SIT 31.5bn (EUR 131.48m), 27% of overall sales. In Central Europe, Krka generated net sales of SIT 26.7bn (EUR 111.44m), 23% of overall sales, while sales in Western Europe and overseas markets were at SIT 20.2bn (EUR 84.31m), or 17% of the company's total. Prescription drugs represent 82% of the sales, followed by over-the-counter drugs with 12%, veterinary products with 4% and cosmetics with 2%. Sales of prescription drugs increased 21% year-on-year, the press release reads. PM Praises Krka Operations, Plans Prime Minister Janez Jansa has praised the operations and vision of pharmaceuticals company Krka as he paid a visit to the company ahead of the cabinet tour of the SE Slovenian regions of Dolenjsko and Bela Krajina Prime Minister Janez Jansa has praised the operations and vision of pharmaceuticals company Krka as he paid a visit to the company ahead of the cabinet tour of the SE Slovenian regions of Dolenjsko and Bela Krajina. Touring the Novo mesto-based company with several ministers on Tuesday, 24 January, Jansa said that Krka is attaining strong results and has a good outlook, something that the cabinet supports. Meanwhile, Krka chairman Joze Colaric pointed out that the company managed to increase its profits by 53% in 2005 to over SIT 20bn (EUR 83.47m). Krka is one of the biggest corporate taxpayers in Slovenia, Colaric said, adding that he hoped the government would cut red tape and therefore promote enterprise. Moreover, Colaric said that Krka has already taken on a number of employees who were laid off at Ljubljana-based pharmaceutical company Lek as part of restructuring at the Novartisowned company. Meanwhile, Economics Minister Andrej Vizjak said that government representatives also used the visit to discuss plans for the government's share in Krka with the company's management. Vizjak said that a decision on what to do with the stake the state holds in Krka through its funds SOD and KAD would be taken in line with progress in structural reforms. The tour of Krka was also attended by Health Minister Andrej Brucan and Reforms Minister Joze P. Damijan. Maos Raises the Stakes Again in Takeover Bid for Iskra Due to the bid raise, the closing date for Iskra Avtoelektrika's takeover bid for Iskra has been extended to 9 February Maos, a company of around 50 leading managers of the Iskra group, has raised its bid for Iskra, the Ljubljana-based electronics group, offering SIT 1,145 (EUR 4.78) per share. The move comes in response to a recent raise by Iskra Avtoelektrika, manufacturer of electronic components for the automobile industry, which offered SIT 1,110 (EUR 4.63) per share on 18 January. The bidding race began on 15 December, when Iskra Avtoelektrika published its original takeover bid offering SIT 1,044 (EUR 4.36) per share. 30 Iskra's management responded to the hostile all-cash bid by offering SIT 1,100 (EUR 4.59) per share on 29 December. Iskra Avtoelektrika, a Sempeter-based company, intends to acquire all Iskra shares, except the 0.33% which it already holds. Iskra, meanwhile, holds a 24.29% share in Iskra Avtoelektrika. Due to the bid raise, the closing date for Iskra Avtoelektrika's takeover bid for Iskra has been extended to 9 February. Shipyard Creditors Endorse Administration The creditors of struggling shipyard Ladjedelnica Izola have backed a proposal to send the company into administration in order to bring it out of its debt The creditors of struggling shipyard Ladjedelnica Izola have backed a proposal to send the company into administration in order to bring it out of its debts. At a hearing at the Koper District Court on Thursday, 26 January, 87.23% of the creditors endorsed the plan to force the company into administration. The measure was proposed by the management in a bid to avert the outright bankruptcy of the company. The company, which has been struggling with debts for three years, has so far failed to be rescued through restructuring. Slovenia's lone shipyard has amassed debts of SIT 2.4bn (EUR 10m), including half in outstanding mortgages. The mortgage creditors will be reimbursed fully, while other creditors will get 20% of their claims within a year. As part of administration, which is to enter into force in eight days, the company intends to sell land and buildings to cover debts. Debts are also be paid from current operations. The company intends to sell a quarter of 24,000 sq. metres in land and half of the 8,000 sq. metres in buildings, thereby acquiring SIT 1.3bn (EUR 5.43m). Sostanj Plant Planning Extensive Investment Through 2010 The Sostanj Power Plant will spend up to EUR 590m over the next four years on gas-powered generators and the construction of new state-of-the-art bloc, the plant's general manager Uros Rotnik told STA Slovenia's largest thermal power plant is planning extensive investment to overhaul its generators and make its more environmentally friendly. The Sostanj Power Plant will spend up to EUR 590m over the next four years on gas-powered generators and the construction of new state-of-the-art bloc, the plant's general manager Uros Rotnik told STA. The new natural gas generators, costing EUR 40m, have already been ordered and will replace the outdated first and second coal-powered blocs at the plant. Rotnik announced that the first of the two gas-powered turbines is expected to begin operating in early 2008, with the other to follow soon after. Meanwhile, the construction of the all-new sixth bloc at the plant is expected to be completed by the end of 2010, costing around EUR 550m. Half of the investment in the construction of the sixth bloc is to come from a capital injection at power producer HSE, the parent company of the Sostanj Power Plant. The company hopes to secure the rest at the European Investment Bank. The sixth bloc is scheduled to go online in 2011, Rotnik told STA. According to him, once the planned upgrades are completed, Sostanj will be able to produce 4,900 gigawatt hours of electricity a year, which is nearly 30% more than now. Emissions, meanwhile, should fall by 31 SLOVENIA IN BRIEF Stane Granda Named Chair of RTV Slovenija Programming Council Stane Granda from the Institution for Reviving Civil Society was elected chairman of the RTV Slovenija programming council at the maiden session of the public broadcaster's governing body on Tuesday, 24 January. Slovenian Officials Send Condolences Over Montenegro Train Crash Slovenian officials have written to their Montenegrin counterparts to express their condolences over the train crash in Montenegro on Monday, 23 January, in which 43 people were killed. Parliament Halts Re-Incorporation of Vzajemna MPs were virtually unanimous on Wednesday, 25 January in adopting an interpretative statement of article 62 of the health insurance act, thus effectively preventing the reincorporation of mutual insurer Vzajemna as a joint-stock company, which was scheduled for 1 February. New Rogaska Boss Wants to Bring the Company Out of the Red The new chairman of glassworks Steklarna Rogaska Robert Licen has said his aim is to bring the company "out of the red" despite a complex set of circumstances in the beleaguered company. Licen told the press on Wednesday, 25 January that he is nevertheless an optimist; with the help of the owners, employees and the state, the situation in the company could improve. Government Nominee Elected Chief Supervisor of the Public Broadcaster Janez Jerovsek has been appointed chairman of the supervisory board of public broadcaster RTV Slovenija, as the board held its maiden session on Thursday, 26 January. Government Dismisses State Secretary for European Affairs The government has dismissed State Secretary for European Affairs Marcel Koprol, the head of the Government Office for European Affairs (SVEZ), who had asked to be relieved of his duties. As of 1 May the SVEZ will be headed by the head of the permanent representation of Slovenia at the OSCE in Vienna Janez Lenarcic. In the meantime Koprol's deputy Katja Relec Longar will take over. Pelikan Receives Hungarian State Secretary for Minorities State Secretary for Slovenians Abroad Zorko Pelikan received on Friday, 27 January in Ljubljana the Hungarian State Secretary for Minorities at the prime minister's office Vilmos Szabo. The pair addressed minority issues in both countries, Pelikan's office has said. Copernicus' Masterpiece Found in Ljubljana Library A Slovenian physicist has accidentally come by a 440-year-old copy of Copernicus' most famous book in a library in Ljubljana. Having borrowed "De Revolutionibus" from the National University Library, physicist Stanislav Juznic soon established that the copy was from 1566 and not 1766 as the library's catalogue claimed, tabloid Slovenske novice wrote on Saturday, 28 January. 32 FM Sends Condolences to Poland over Tragic Accident FM Dimitrij Rupel sent a letter of condolences to his Polish counterpart Stefan Meller on Sunday, 29 January, expressing his personal and the government's deep sympathies over an accident which killed dozens on 28 January. Anzej Dezan to Represent Slovenia at Eurosong Anzej Dezan has won the EMA, the competition which decides Slovenia's entry for the European song contest, with a love song "Plan B". Dezan, who is only at the beginning of his singing career, will try to make it past the semi-finals in mid-May to appear at the 51st Eurosong in Athens two days later. 33