Slovenia Business Week no. 09, February 27th, 2006
Table of Contents:
HEADLINES ................................................................................................................. 3
Improvement on Economic Freedom Index Encouraging, Bajuk Says...................... 3
New Intereuropa CEO Presents Ambitious Strategy .................................................. 3
Adria to Start Flying Three New Routes .................................................................... 4
INTERNATIONAL COOPERATION .......................................................................... 5
Economics Minister Calls for Increased Trade with Montenegro .............................. 5
Slovenia Informs UN of Ecological Zone .................................................................. 5
Minister: Slovenia Ready to Assist Bosnia on Path to EU ......................................... 6
German Firms Criticise Growing Cost of Doing Business in Slovenia ..................... 6
FM Rupel Confirms Slovenia's Respect of One China Policy ................................... 7
EUROPEAN UNION .................................................................................................... 8
Borrell Says Slovenia Has Used EU Membership to Its Advantage .......................... 8
FM Rupel, Borrell Discuss European Constitution and Enlargement ........................ 8
Slovenia, Spain Agree to Work on Changing Mercury Directive .............................. 9
EU Survey: Slovenians Want to Learn English and German ..................................... 9
EU: Slovenia Lagging behind in Transposing EU Legislation ................................ 10
Borrell Holds Talks with Slovenian President, Lawmakers ..................................... 10
EU Report: Slovenian Death-toll on the Roads above EU Average ........................ 11
Slovenia, Germany, Portugal Discuss EU Presidency ............................................. 11
Government Gives General Endorsment to EU Services Directive ......................... 11
Barroso Hopes Slovenia Will Embody European Ambition .................................... 12
LEGISLATION ........................................................................................................... 14
Constitutional Court Stays Collection of Eco Tax at the Border ............................. 14
STATISTICS/FORECASTS........................................................................................ 15
Slight Drop Registered in Business Sentiment ......................................................... 15
FINANCE .................................................................................................................... 16
Banka Koper Reports Solid Growth ......................................................................... 16
Lawmaker Argues for Individual Assessment of Euro Readiness ........................... 16
Ministry Expands Exemptions to Double Pricing .................................................... 17
Slovenia Got No Offer from KBC, Finance Minister Says ...................................... 17
NLB Group to Set up Two Companies in Serbia-Montenegro ................................ 18
Minister Promises Simpler Tax Laws; No Final Word on Flat Tax ......................... 19
Probanka Posts EUR 4.17m Profit in 2005 .............................................................. 19
Finance and Monetary Policy Committee Approves Succession Bill ...................... 20
Government Adopts 2006-2007 Plan for Capped Prices.......................................... 20
Ljubljana Stock Exchange ........................................................................................ 21
Foreign Exchange ..................................................................................................... 22
REGIONAL INFORMATION .................................................................................... 23
Ministers Promise State Support for Lower Podravje Region ................................. 23
BRANCH INFORMATION ........................................................................................ 23
Tourism Strategy: 3.3 Million Visitors by 2011....................................................... 23
EU Unhappy with Situation on Slovenian Telecoms Market................................... 24
Retailers Pull Out of Collective Bargaining Agreement .......................................... 25
Poultry Producer Expects Determined Actions on Bird Flu ..................................... 26
Talks on Shop Opening Hours Bogged Down ......................................................... 26
Second Case of H5N1 Confirmed in Slovenia ......................................................... 27
COMPANIES .............................................................................................................. 29
Maos Raises Bid for Iskra Again .............................................................................. 29
Competition Protection Office Approves Acquisition of Lama by Titus International
.................................................................................................................................. 29
Adria Sends Leased Cargo Plane Back to Aurora Airlines ...................................... 29
Court Approves Administration for Iskraemeco ...................................................... 30
Gaming Chain Reports 24% Rise in Gross Revenues, 34% Rise in Profit .............. 30
2005 a Hit for Gaming Chain, Its Chairman Says .................................................... 31
Minister Promises Assistance to Aluminium Processor Impol ................................ 31
Major Trimo Owners Gain Control of Company ..................................................... 32
Government Pledges Support for Restructuring of Ormoz Sugar Factory............... 32
Pivovarna Lasko Increases Net Profit by 7.1% in 2005 ........................................... 33
Hit Supervisors Elect New Chairman ....................................................................... 33
Government Appoints Tuerk Chairman of Power Utility Eles ................................ 34
State-run Funds to Sell Their Share in Lip Bled ...................................................... 34
Gorenje Meets Profit Target in 2005 ........................................................................ 34
Mlinotest Posts Profits but Misses Targets............................................................... 35
Construction Group Primorje Acquires Serbia's PZP Pozarevac ............................. 35
French Want to Increase Stake in Ski-Resort Manager to over 50% ....................... 36
Foreigners Interested in Largest Slovenian Publisher .............................................. 36
SLOVENIA IN BRIEF ................................................................................................ 38
Parliament Committee Endorses Division to Two Cohesion Regions ..................... 38
Rode Naming Shows Pope's Confidence in Slovenia, Uran Says ............................ 38
Justice Minister Sturm Meets Macedonian Counterpart .......................................... 38
Slovenia, Hungary Culture Ministers Sign Cooperation Agreement ....................... 38
HEADLINES
Improvement on Economic Freedom Index Encouraging, Bajuk Says
Finance Minister Andrej Bajuk has said that Slovenia's leap from 45th to 38th of 157
countries on the 2006 Index of Economic Freedom is very encouraging for the
country
Finance Minister Andrej Bajuk has said that Slovenia's leap from 45th to 38th of 157
countries on the 2006 Index of Economic Freedom is very encouraging for the
country. His comments came after his meeting with Marc Miles, an editor of the
survey on Tuesday, 21 February.
According to Bajuk, the improvement in Slovenia's economic freedom as measured
by the Washington think-tank Heritage Foundation and business paper Wall Street
Journal is an incentive for the Slovenian government to keep up efforts to set up a
framework conducive to enterprise.
Creating such a framework would inspire entrepreneurship in individuals and
subsequently promote innovation, competitiveness, all whilst creating new jobs,
Bajuk said following his meeting with the director of the Heritage Foundation's
Center for International Trade and Economics.
Bajuk claimed that establishing such a framework would require appropriate changes
to tax legislation since the current progressive tax system does not promote
entrepreneurship among people.
Meanwhile, Miles praised Slovenia for its successes, but stressed that the country
needed to do more to attract foreign investors. One of the main tools available to
Slovenia is establishing a more appealing tax system, he added.
Slovenia has one of the highest tax burdens of any country, which is not good as
many Eastern European countries have opted for low tax rates and are therefore
becoming more competitive, he added.
He endorsed plans to introduce flat tax in Slovenia, since he believes that this would
be an excellent option for Slovenia. In Miles's view, flat tax would improve economic
competitiveness and enable the state to collect more taxes than now.
New Intereuropa CEO Presents Ambitious Strategy
New Intereuropa chairman Andrej Lovsin told business daily Finance that the
logistics company's new strategy was "aggressive leadership"
New Intereuropa chairman Andrej Lovsin told business daily Finance on Thursday,
23 February that the logistics company's new strategy was "aggressive leadership".
"We will attempt to regain all business which Intereuropa once already had," he said.
"This year we will set up companies in Romania, Bulgaria, Kosovo, Montenegro and
Albania, thus regaining everything Slovenia has lost by joining the EU. Next year we
will attempt to break onto the markets of Central Asia and the countries surrounding
the Black Sea," Lovsin added.
He explained that the previous management "lost the incentive in the Slovenian
logistics market, which is something we will have to restore". "With the projects I am
planning, Intereuropa will become an excellent company within three years," Lovsin
assures.
In Serbia alone, Intereuropa plans to invest around EUR 10 million during the
mandate of the current management. The company is moreover to invest in other
markets of southeastern Europe, according to Lovsin.
"We are also currently in talks with the German publisher WAZ Mediengruppe on
taking over its logistical activities on the markets of SE Europe," said Lovsin, who
was appointed to the new post in mid January.
Intereuropa will furthermore probe the market for the port operator Luka Koper on all
the above markets. "We will cooperate on projects in the Far East and are considering
having a terminal depot in Hungary," he added.
Lovsin said cooperation with the port is expected to increase by 15% this year. There
would also be a global logistics centre project to which Slovenian Railways would be
invited to participate in.
Adria to Start Flying Three New Routes
Flag carrier Adria Airway has announced it would add three new routes - Rome,
Barcelona and Tirana - to its scheduled flights at the end of March
Flag carrier Adria Airway has announced it would add three new routes - Rome,
Barcelona and Tirana - to its scheduled flights at the end of March. That way Adria
expects to profit from the increasing interest of Spanish and Italian tourists for
Slovenia, and cater to business travellers on the Tirana route.
Adria will be assisted in its efforts by the Slovenian Tourist Board (STO), which will
beef up ad campaigns in Italy and Spain as part of its plans to increase the number of
guests arriving in Slovenia by plane.
The two sides met in Ljubljana on Thursday, 23 February to discuss the details of a
prospective partnership; the STO has earmarked SIT 100m (EUR 0.42m) this year to
boost the number of incoming airline passengers.
Part of the money will also be available for new charter connections with Italy,
Germany, Austria, the Benelux countries, Great Britain, Ireland, Spain, France, Israel
and Russia, according to Karmen Novarlic of the STO.
Adria will fly to Rome four times a week, to Barcelona twice weekly and to Tirana
six times a week, according to the carrier's press release.
Fares excluding tax start at around 120 euros for Barcelona and Rome, and at 200
euros for Tirana.
INTERNATIONAL COOPERATION
Economics Minister Calls for Increased Trade with Montenegro
The ministry's mid-term priority tasks include facilitating Slovenian investments in
Montenegro, helping the country's companies and reducing red tape and other
trading obstacles
The Slovenian Economics Ministry will focus on activities to increase trade between
Slovenia and Montenegro, Slovenian Economics Minister Andrej Vizjak said on
Monday, 20 February in Sveti Stefan.
The ministry's mid-term priority tasks include facilitating Slovenian investments in
Montenegro, helping the country's companies and reducing red tape and other trading
obstacles, Vizjak added.
Speaking on the second day of a meeting entitled Montenegro in the 21st century,
Vizjak moreover offered Slovenia's support and know-how in implementing key
economic reforms in the country.
"We will focus on furthering economic relations on all levels," Vizjak told a
workshop on economic development and perspectives for prosperity.
Slovenian exports and direct investments in Montenegro have grown in the past years,
with future cooperation possible in tourism, energy, construction, transport and trade,
Vizjak said.
Slovenian exports to Montenegro amounted to EUR 66.83m in 2005, while Slovenia
imported EUR 29.61m worth of Montenegrin goods, a ten fold increase in comparison
with 2004.
Indeed, said Vizjak, with Slovenia's entry into the EU and a consequent abolishment
of customs duties for Montenegrin products, imports from Montenegro are bound to
increase further.
With total trade standing at EUR 96.45m, Slovenia is Montenegro's third most
important trade partner, he pointed out.
Meanwhile, Slovenian investments in Montenegro stood at EUR 22.9m in 2005,
making it the third biggest investor in Montenegro. Slovenians invested mainly into
the tourism sector.
Slovenia Informs UN of Ecological Zone
Slovenia has sent notice to UN Secretary General Kofi Annan of its declaration of an
ecological zone and determination of a continental shelf in the Adriatic Sea
Slovenia has sent notice to UN Secretary General Kofi Annan of its declaration of an
ecological zone and determination of a continental shelf in the Adriatic Sea.
The Slovenian Foreign Ministry said on Wednesday, 22 February that Annan was
officially informed of Slovenia's law on the ecological zone, passed by parliament last
October, in his capacity as the depositary of the UN Convention on the Law of the
Sea.
Slovenia has therefore fulfilled the criteria for the declaration of the protective zone
and determination of the continental shelf in line with the Convention.
In the note sent to Annan, Slovenia explains that it is declaring the zone in line with
the Convention and all other international agreements.
The note also sets down Slovenia's rights and the rights of other countries in the
Slovenian ecological zone and underscores that the final delineation of the zone
would be determined in agreement with neighbouring countries.
Annan will now inform all the signatories of the Convention of Slovenia's declaration
of the ecological zone, the Foreign Ministry said.
The act on the declaration of an ecological zone and determination of a continental
shelf was passed with an overwhelming majority in the Slovenian National Assembly
on 4 October.
The government said the act would give Slovenia equal status to its Adriatic
neighbours Italy and Croatia, who were planning to declare zones of their own.
According to the Slovenian government, the underlying purpose of the law is to
declare a zone that will implement effective measures for the preservation of the
integrity of the marine ecosystem in the Adriatic, Slovenian territorial waters and
coastal areas.
Croatia, which passed a similar law a year earlier, claimed that the Slovenian move
was legally unfounded and reflected Slovenia's territorial claims in the Adriatic.
Minister: Slovenia Ready to Assist Bosnia on Path to EU
Slovenian Environment Minister Janez Podobnik has assured his counterparts from
the two federations of Bosnia-Herzegovina that his ministry stands ready to assist the
former Yugoslav republic in its bid to join the EU
Slovenian Environment Minister Janez Podobnik has assured his counterparts from
the two federations of Bosnia-Herzegovina that his ministry stands ready to assist the
former Yugoslav republic in its bid to join the EU.
Podobnik pointed out that Bosnia-Herzegovina will have to walk the same path as
Slovenia to join the EU, making Slovenia's experience invaluable.
His comments come after he met his counterparts from the Croat-Muslim Federation
and the Republic Srpska, Ramiz Mehmedagic and Muhamed Lisic, in Ljubljana on
Thursday, 23 February.
The important thing is for all EU candidate countries to fully get ready for
membership and Slovenia could help Bosnia with this, Podobnik said.
Moreover, Podobnik called for greater cooperation between the two countries in
environmental protection and the use of renewable sources of energy.
Mehmedagic and Lisic thanked Podobnik for the assistance Slovenia has offered
Bosnia so far and stressed the value of Slovenian experiences in EU integration
processes.
Bosnia-Herzegovina will find it easier to avoid making mistakes on its path to the EU
with Slovenian experiences, the pair pointed out.
German Firms Criticise Growing Cost of Doing Business in Slovenia
German businesses with operations in Slovenia have been increasing pre-tax profits
and assess the overall business environment as favourable, but they are critical of the
growing costs of doing business, according to a survey by the Representation of
German Business in Slovenia
German businesses with operations in Slovenia have been increasing pre-tax profits
and assess the overall business environment as favourable, but they are critical of the
growing costs of doing business, according to a survey by the Representation of
German Business in Slovenia.
Some 75% of the firms saw their costs go up last year. Interestingly, however, labour
costs grew only moderately, but energy and other costs soared, reveals the survey,
which was released on Thursday, 23 February.
Meanwhile, investment expenditures increased by 50% last year. The survey points
out that there were no spectacular investments, as German companies tend to start
small and then gradually expand.
The overall trends are positive, with exports as well as imports growing. Germany
remains Slovenia's biggest export destination, taking in 20% of the country's exports,
but it is also the biggest source of imports.
Exports to Germany suffered a mild setback last year due to the ongoing recession in
Germany, while imports have been growing as Slovenia's domestic consumption
grows.
The companies included in the survey are upbeat about this year: 50% expect better
sales and 40% higher profits. Investment expenditures are set to rise as well, but not
as fast as last year.
After years of moderate growth in labour costs, 8% of the companies expect to pay
higher salaries, while 70% believe salaries will not change significantly.
In other fields assessed by the poll, the companies gave Slovenia good grades for
location, the quality and availability of local suppliers, as well as productivity and
domestic demand.
However, they were critical of the high taxation, and said the efficiency of the public
administration does not meet expectations.
High labour costs, rigid labour laws and the availability of qualified staff also made it
to the negative list.
Despite the criticism, 80% of the firms said they would invest in Slovenia again.
FM Rupel Confirms Slovenia's Respect of One China Policy
FM Dimitrij Rupel assessed bilateral relations with China as excellent and confirmed
Slovenia's respect for the principle of one China, as he met the Chinese Deputy FM
Lu Qiutian in Ljubljana
FM Dimitrij Rupel assessed bilateral relations with China as excellent and confirmed
Slovenia's respect for the principle of one China, as he met the Chinese Deputy FM
Lu Qiutian in Ljubljana on Friday, 24 February.
Lu, who heads the Chinese Institute of Foreign Affairs, also met State Secretary at the
Foreign Ministry Bozo Cerar, the Foreign Ministry said.
Lu and Cerar discussed reforms of the UN, especially the Security Council, and
touched upon the Iranian nuclear issue, the ministry added.
Cerar moreover acquainted Lu with Slovenian preparations for the country's stint as
EU president in the first half of 2008.
Meanwhile, Rupel used the opportunity to invite his Chinese counterpart Li Zhaoxing
as well as Chinese Prime Minister Wen Jiabao to visit Slovenia.
EUROPEAN UNION
Borrell Says Slovenia Has Used EU Membership to Its Advantage
European Parliament President Josep Borrell praised Slovenia's achievements after
talks with Parliament Speaker France Cukjati, saying it was admirable how well
Slovenia has taken advantage of the opportunities offered by EU membership
European Parliament President Josep Borrell praised Slovenia's achievements after
talks with Parliament Speaker France Cukjati on Monday, 20 February, saying it was
admirable how well Slovenia has taken advantage of the opportunities offered by EU
membership.
Borrell was thrilled with the country's readiness to adopt the euro, and the fact that
Slovenia will be the first among EU newcomers to take over the EU's rotating
presidency.
"I believe that the debate on the constitutional treaty will be in full swing in the first
half of 2008 when Slovenia is the presiding country," he told the press, adding that a
crucial inter-governmental conference on the treaty would probably be held then as
well.
Talks with Cukjati also touched on the 2007-2013 EU financial perspectives, with
Borrell saying that the budget cannot be confirmed without a final agreement between
the three key EU institutions and the corrections that the parliament is promoting.
If it is impossible to reach agreement with the EU Council in a month, year-by-year
spending plans will have to be adopted, Borrell explained.
According to Borrell, the EU sees Slovenia as a "very dynamic" country which
implements reforms quickly and efficiently. "We see you as a country not afraid of
change and innovation," which is crucial for a successful implementation of the
Lisbon Strategy.
Borrell said that in-depth talks about the most topical issues would resume in
parliament on Tuesday, 21 February, when he takes part in a joint session of the
parliamentary committees for EU affairs and foreign police.
FM Rupel, Borrell Discuss European Constitution and Enlargement
According to the Foreign Ministry, the pair stressed the importance of informing the
EU citizens about the constitution and the role national parliaments should play in
the communication chain
The calm that set in after the EU constitution was rejected at the referendums in
France and the Netherlands in 2005 needs to end as soon as possible, European
Parliament President Josep Borrell and FM Dimitrij Rupel agreed on Monday, 20
February.
According to the Foreign Ministry, the pair stressed the importance of informing the
EU citizens about the constitution and the role national parliaments should play in the
communication chain.
Rupel and Borrell also discussed the future enlargement of the EU and stressed the
importance of European accession for Western Balkans countries.
Prior to the meeting, Borrell also took part in a public debate on the future of the EU
constitution and the EU, saying that Slovenia is likely to play an important role in the
process, as it will preside over the EU in the first half of 2008.
He called the EU a fantastic success story, saying that "we have gone much further
than we aimed for at the beginning". Now the important question is what we want, he
added.
Indeed, the recent EU expansion in May 2004 was a historic event, but the 25- or later
even 27-member EU cannot function based on rules set down in the Nice Treaty. "If
we as Europeans want to influence world events we need a new debate on the
Constitutional Treaty," Borrell pointed out.
According to MEP (PES) and the head of the opposition Social Democrats, Borut
Pahor, Europe can now either forge ahead with the political union or fall back to a
free-trade area.
He called for a referendum on the EU constitution that would take place in all EU
members simultaneously, explaining that "EU is a house built without plans. Now we
have to get back to the basics".
Slovenia, Spain Agree to Work on Changing Mercury Directive
The Slovenian and Spanish environment ministers have agreed that the two countries
would work together in seeking to change the European Commission's proposal for a
European mercury directive
The Slovenian and Spanish environment ministers have agreed that the two countries
would work together in seeking to change the European Commission's proposal for a
European mercury directive.
Slovenia's Janez Podobnik and Spain's Christina Narbona Ruiz agreed on a common
stand for changes to the directive at a meeting in Ljubljana on Monday, 20 February,
which was held as part of Narbona Ruiz's one-day visit to the country.
Meanwhile, Podobnik took his Spanish counterpart for a visit to the defunct Idrija
mercury mine, which during its heyday was one of the biggest mercury mines in
Europe, the Environment Ministry said.
Podobnik acquainted Narbona Ruiz with Slovenia's initiative to set up an information
and research centre for mercury in Idrija, the ministry added in its press release.
According to the minister, the initiative would tap into Slovenian know-how on
mercury for the good of the environment and health. Spain's minister is said to have
backed the initiative.
EU Survey: Slovenians Want to Learn English and German
As many as 71% of Slovenians claim they speak at least two foreign languages
As many as 71% of Slovenians claim they speak at least two foreign languages, while
47% believe all Europeans should speak two other languages beside their mother
tongue, according to the latest Eurobarometer poll.
Furthermore, 96% of all Slovenians polled feel that children should learn English,
whereas 69% of them favour German, according to the survey which was released in
Brussels on Tuesday, 21 February.
Other foreign languages are not that popular among Slovenian respondents: only 6%
opted for French, the second working language in the EU, 12% for Italian and no
more than 3% for Spanish.
On average, the majority of EU residents also puts English first (77%), followed by
French (33%), German (28%), Spanish (19%), Russian (3%) and Italian (2%).
An average of 28% of Europeans speak two foreign languages, the majority in
Luxembourg (92%) and the Netherlands (75%), while Slovenia is third with 71%.
The survey was carried out in November and December on 28,694 respondents in 25
member states, two acceding and two candidate countries.
EU: Slovenia Lagging behind in Transposing EU Legislation
Slovenia has started to lag behind in transposing EU internal market legislation in
the last six months
Slovenia has started to lag behind in transposing EU internal market legislation in the
last six months, the European Commission said in Brussels on Tuesday, 21 February.
Slovenia's "deficit" has grown by 0.5% in the period.
With only 19 directives out of 1,635 waiting to be transposed, Slovenia still ranks
10th among 25 EU members. The Commission therefore warned it not to spoil its
achievements.
The country has to transpose 1.2% of all EU directives, with the EU average standing
at 1.6%.
Topping the list of best performers is Lithuania with six directives to be transposed,
while Greece and Luxembourg are at the bottom of the list with 60 and 72
respectively.
The Commission revealed that the average delay for member states stands at 9.2
months, with Slovenia slightly better at six months.
It has also launched seven procedures against Slovenia for not implementing the
already transposed directives.
The Commission moreover specifically dealt with EU financial services directives in
the report. Slovenia has so far transposed 18 of 20 such directives
Borrell Holds Talks with Slovenian President, Lawmakers
The future of the EU, subsequent rounds of enlargement and cultural-civilisational
aspects of the Union topped the agenda of talks with Drnovsek
European Parliament President Josep Borrell met President Janez Drnovsek, Finance
Minister Andrej Bajuk and members of the parliamentary committees for EU affairs
and foreign policy on the final day of his two-day visit to Slovenia on Tuesday, 21
February.
The future of the EU, subsequent rounds of enlargement and cultural-civilisational
aspects of the Union topped the agenda of talks with Drnovsek, the president's office
said.
Borrell was reportedly interested in the president's position on the situation in Kosovo
and Montenegro, and hailed his efforts towards a peace agreement for the Sudanese
region of Darfur.
It is very important for a small country such as Slovenia to have projects with which it
highlights global issues and helps solve them, Borrell was quoted as saying.
Borell was also received for a working lunch by Minister Bajuk, who outlined the
development potentials of the Slovenian economy and its financial market, as well as
the preparations for the euro changeover.
According to the Finance Ministry, Borrell was interested in the responsiveness of
Slovenians to EU topics, while the pair also exchanged views on the necessity to carry
out reforms in the EU.
The EU's current challenges meanwhile dominated Borrell's talks in the National
Assembly alongside ways to bring the Union closer to the people and the role of
parliaments in this process.
The Slovenian MPs meanwhile quizzed Borrell about the dilemmas of the EU's
common foreign policy in terms of the bloc's relations to Muslim countries, and
questions related to EU enlargement, according to the parliament's press release.
EU Report: Slovenian Death-toll on the Roads above EU Average
In 2004, the European average numbered 95 people per million inhabitants while in
Slovenia this number rises to 137
The number of people who die on Slovenian roads every year is greater than the
European average, reveals a report published by the European Commission in
Brussels on Wednesday, 22 February.
In 2004, the European average numbered 95 people per million inhabitants while in
Slovenia this number rises to 137. Admittedly, the number is falling, but too slowly,
notes the Commission.
This is true not just for Slovenia but for all 25 EU members. The EU has set itself the
target of reducing the road death-toll by 25% by 2010, from the 50,000 people who
died in the 25 countries in 2001.
In 2005 the death-toll stood at 41,600, which is 17.5% less than in 2001 but still too
great: at this rate the number of people to die on the roads will still be 32,500 people
in 2010.
Regarding road-safety in member states, the Commission finds that this is worse in
the new members than in the old ones.
France, which was hitherto the death-toll record-holder, has succeeded in bringing
numbers down by 32% in recent years using various measures, from 8,162 dead in
2001 to just 5,530 in 2004.
In Slovenia the number had decreased by just 1% in the same period, from 278 to 274,
reported the Commission.
Slovenia, Germany, Portugal Discuss EU Presidency
Officials from Slovenia, Germany and Portugal, the countries scheduled to chair the
EU in 2007 and the first half of 2008, met in Berlin to discuss cooperation on the
procedural level
Officials from Slovenia, Germany and Portugal, the countries scheduled to chair the
EU in 2007 and the first half of 2008, met in Berlin on Wednesday, 22 February to
discuss cooperation on the procedural level, Katja Rejec Longar of the Government
Office for European Affairs has said.
As Rejec Longar explained for STA after the meeting, the three countries agreed on
personnel referral, training of officials and exchange of information during their
respective presidencies.
In line with the initial plans, that is if the European Constitution had been ratified as
expected, Slovenia, Germany and Portugal would have presided the EU Council from
the beginning of 2007 to the middle of 2008 together.
However, due to the complications regarding the ratification of the Constitution in
some EU states, the current form of six-month rotating presidency remains in force.
Government Gives General Endorsment to EU Services Directive
The government has voiced "general" approval for the EU services directive that the
European Parliament passed in first reading, but indicated it had been supporting a
more liberal version than was eventually passed
The government has voiced "general" approval for the EU services directive that the
European Parliament passed in first reading, but indicated it had been supporting a
more liberal version than was eventually passed.
The government had been supporting the country of origin principle (the most
disputed part of the directive) that the parliament threw out, Economics Minister
Andrej Vizjak said after the government session.
Moreover, it was in favour of a narrower list of exemptions from the liberalisation.
"The parliament took a broader approach here and in my opinion somewhat watered
down the original purpose," said Vizjak.
However, Vizjak was quick to point out that it was crucial services such as banking,
electronic communications, transport, health and gaming were exempt from the
provisions.
"This is a political compromise that the European Commission will have to take into
account as it drafts a new version and submits it for renewed scrutiny," he added.
Barroso Hopes Slovenia Will Embody European Ambition
"I hope Slovenia will be a good example of Europe's big ambitions," said the
president of the European Commission Jose Manuel Barroso as he summed up his
expectations about Slovenia's EU presidency in the first half of 2008 and in general
"I hope Slovenia will be a good example of Europe's big ambitions," said the
president of the European Commission Jose Manuel Barroso as he summed up his
expectations about Slovenia's EU presidency in the first half of 2008 and in general.
"The transition in Slovenia is considered as exemplary, Slovenia is going to be the
first new member to preside the EU, and most likely the first new member to join the
eurozone," Barroso said in an interview before his first visit to Slovenia.
According to him, this is not just "wishful thinking", but based on firm foundations.
This is why Barroso said his message in Slovenia would be one of confidence and
trust.
Addressing Slovenia's EU presidency in the first half of 2008, Barroso said the
presidency of a smaller member state is by no means inferior to that of the biggest
member states.
"For a small country this is usually such an important issue that it dedicates much
more intellectual, political and social energy to it. Big EU members have many
priorities and challenges, and sometimes cannot put the same kind of focus on the
presidency," he explained.
As Barroso put it, there are no big or small countries, just big and small ambitions for
Europe. "I hope Slovenia will be a good example of big ambitions for Europe," he
said, especially since its presidency comes at a crucial time for the EU constitutional
treaty.
According to him, the message of confidence and trust that he is bringing is also
based on the 2007-2013 budget, which, although it is smaller than the Commission's
proposal, gives Slovenia much more funding.
"There is no reason for pessimism, we can be optimistic," he said, adding that this
goes for the EU in general. There are problems in terms of the connection between
EU institutions and the people, while some of them are related to unemployment.
However, if the economy recovers all this can change; there are signs that confidence
in the economy is rising, for example in Germany, he emphasised.
Yet, more has to be done on the side of politics "to consolidate these achievements,"
including by embarking on structural reforms and lifting restrictions on the movement
of labour from the EU newcomers.
Barroso will be arriving in Slovenia just weeks after his first tour of the Balkans,
where, he says, he saw with his own eyes that the region really needs the prospects of
joining the EU.
Speaking about the Balkans, Barroso could not avoid questions about Slovenia's
relations with Croatia, especially the dispute over the border. But, just as Enlargement
Commissioner Olli Rehn before him, Barroso was clear.
"I hope bilateral problems will be resolved bilaterally, they should not be treated in a
broader framework. I hope they will be resolved bilaterally, in a solid, constructive
spirit," he added.
Barroso will be visiting Slovenia on 1 and 2 March alongside Communication
Strategy Commissioner Margot Wallstroem and Science and Research Commissioner
Janez Potocnik, the Slovenian member of the Commission.
LEGISLATION
Constitutional Court Stays Collection of Eco Tax at the Border
The Constitutional Court has stayed the collection of ecological tax for lorry drivers
at border crossings, which had been introduced by border municipalities through
local decrees
The Constitutional Court has stayed the collection of ecological tax for lorry drivers at
border crossings, which had been introduced by border municipalities through local
decrees.
The decrees were stayed at the request of the government pending a final ruling from
the court, as it would be hard for lorry drivers to demand a refund if the decrees are
found to be inconsistent with the Constitution, the court said on Thursday, 23
February
The government had urged 12 municipalities in September to annul their decrees,
which had been assessed by the Ministry of the Environment and Spatial Planning as
unlawful.
The ministry claimed that the laws which the decrees are referencing (the acts on
environment protection, local government and municipal activity) provided no legal
basis for the taxes.
Three municipalities revoked the relevant decrees in time, but Bistrica ob Sotli,
Brezice, Gornja Radgona, Ilirska Bistrica, Lendava, Podlehnik, Sempeter-Vrtojba,
Sentilj and Zetale refused.
STATISTICS/FORECASTS
Slight Drop Registered in Business Sentiment
Business sentiment dropped 1 percentage point in February due to falls in consumer
confidence and confidence in the retail sector, the Statistics Office has said
Business sentiment dropped 1 percentage point in February due to falls in consumer
confidence and confidence in the retail sector, the Statistics Office has said.
In its business sentiment index data, the Statistics Office pointed out that in spite of
the February fall in overall confidence, the index was still 5 percentage points higher
than in the same month of 2005.
The biggest drop in sentiment was seen in the retail sector: the index fell 4 percentage
points. Nevertheless, it was still 4 percentage points higher than in February 2005.
Consumer confidence fell 2 percentage points in February, but remained 3 percentage
points above the long-term average. Worries returned among consumers about the
general economic situation in the country for the next year.
The seasonally adjusted value for the manufacturing confidence index was 1
percentage points higher in February over January and 8 percentage points above
where it was at the same time last year, according to data from the Statistical Office.
Confidence in the services sector, meanwhile, remained unchanged in February,
although it was down 4 percentage points over the same month in 2005.
FINANCE
Banka Koper Reports Solid Growth
The bank made a net profit of SIT 5.6bn, which is 16% more than in 2004
Banka Koper's total assets increased by 30% in 2005, reaching SIT 433bn (EUR
1.8bn). The bank made a net profit of SIT 5.6bn, which is 16% more than in 2004, the
daily Delo reports on Tuesday, 21 February.
Pleased with the bank's performance, its chairman Vojko Cok told the paper that the
bank continues to be a leader in profitability and in the stability of its market position.
However, Slovenia's fifth-largest bank is not planning any takeovers or mergers. "We
are aiming for continued growth. We are not a bank which wants to conquer the
market in reckless leaps and bounds," Cok told Delo.
Banka Koper, which has been in the majority ownership of Italian bank SanPaolo IMI
since 2002, is "not dictated by Turin", says Cok. "Management responsibilities are
clear-cut and there have hitherto been no cases of disagreement or voting down."
Banka Koper used to be a co-owner in many Slovenian companies during their
restructuring, but has already sold its shares in many of them. Cok says it also plans to
sell its shares in the shipping company Splosna plovba Portoroz and automotive
component producer Cimos Koper, but again it is in no rush to do so.
During the past year, the bank entered the NFD group and has almost a 15% share in
it. The NFD group is interesting because it does business with many existing and
prospective clients of Banka Koper, Cok told Delo.
Lawmaker Argues for Individual Assessment of Euro Readiness
The chair of the Slovenian parliamentary economics committee has promoted
Slovenia's case for an individual assessment of the country's readiness to adopt the
euro as he took part in a meeting of his counterparts from the EU member states and
the European Parliament
The chair of the Slovenian parliamentary economics committee has promoted
Slovenia's case for an individual assessment of the country's readiness to adopt the
euro as he took part in a meeting of his counterparts from the EU member states and
the European Parliament.
Feri Horvat, a lawmaker of the opposition Social Democrats (SD), said he sought an
answer from competent officials on whether the European Central Bank (ECB) and
the European Commission would issue an individual assessment of Slovenia's
readiness for the euro.
However, he was unable to get a definite answer. "It is more than obvious that
Slovenia will need to work hard to push its case so that it does not get delayed given
that the two other candidates are not on track," Horvat said.
He said it looked as if the ECB was reserved about an individual assessment of the
candidates due to practical problems associated with the individual adoption by new
members, he said.
At the meeting of the chairs of economics committees from the EU member states and
the European Parliament, Horvat also outlined the measures Slovenia has undertaken
to adopt the euro.
"Slovenia is expecting a decision by the end of June or early July at the latest so that it
could carry out all operational aspects for introducing the euro on 1 January 2007," he
explained.
The officials met to discuss ways to boost economic growth in the eurozone. Horvat
headed a Slovenian delegation to the meeting, whose participants agreed that
investment in research and development was a key to boosting economic growth as
was greater harmony among the economic policies of EU member states.
Ministry Expands Exemptions to Double Pricing
The Ministry of Economics has issued rules on informative dual pricing which expand
the list of exemptions from the mandatory dual display of prices in euros in tolars that
enters into force on 1 March
The Ministry of Economics has issued rules on informative dual pricing which expand
the list of exemptions from the mandatory dual display of prices in euros in tolars that
enters into force on 1 March.
The act on the dual display of prices in tolars and euros already determines ten groups
of exemptions, but the rules, unveiled on Wednesday, 22 February further expand this
list to border shops, motorway toll, air, rail and bus transport, and taxis.
Border shops will thus be allowed to display only a dual-currency list of at least 30
typical prices without having to label all products in euros and tolars.
Toll will be displayed in tolars and euros, but the receipt will contain only tolars for
payment in tolars and in both currencies if payment is made in a foreign currency.
Air tickets will not be made in both currencies, but ticket vendors will have to have a
list displaying at least five typical rates.
Double prices will not be required for train and bus tickets issued on the train or bus.
The same goes for taxis, according to the rules.
The rules also stipulate exemptions for payments by non-residents. Sums on invoices
issued to non-residents paying in foreign currency will not be converted according to
the central parity rate, but at the market rate.
Since only non-residents are allowed to pay in foreign currency in Slovenia, the
ministry said it would have been too confusing if they received invoices based on the
central parity rate but had to pay by the market exchange rate.
According to the ministry, these rules will help companies that could have been
severely hurt by the provisions on double pricing.
Exemptions already provided in the law include petrol sales, catalogues, bread, meat
and delicatessen, vending machines and farmers.
Slovenia Got No Offer from KBC, Finance Minister Says
The Finance Ministry has not received any official offer from KBC, Finance Minister
Andrej Bajuk said in a response to a report that this Belgian banking and insurance
group has offered the Slovenian and Croatian governments a loan to pay off the debt
of a defunct Slovenian bank to Croatian savers
The Finance Ministry has not received any official offer from KBC, Finance Minister
Andrej Bajuk said on Wednesday, 22 February in response to a report that this
Belgian banking and insurance group has offered the Slovenian and Croatian
governments a loan to pay off the debt of a defunct Slovenian bank to Croatian savers.
According to Bajuk, KBC has repeatedly expressed concern about the complicated
issue of succession of the former Yugoslavia. "Slovenian standpoints are clear, and
the country does not intend to change them in order to solve one aspect of the matter,"
he added.
Meanwhile, FM Dimitrij Rupel told the national broadcaster that Slovenia does not
need a loan to solve LB's problems. "We would be happy to remove the succession
issue from the agenda, yet it is a responsibility of all former Yugoslavian countries,"
he also told Radio Slovenija.
Slovenia's high representative for succession, Miha Pogacnik, moreover told Radio
Slovenija that the country does not plan to respond to KBC's initiative, which he
labelled as legitimate. "It is however a private offer, which the state has not received
officially yet," he added.
KBC chairman Andre Bergen told the Croatian daily Slobodna Dalmacija that they
are prepared to approve a EUR 80m loan to each government, as the debt of
Ljubljanska banka (LB) is estimated at around EUR 160m.
KBC has been interested in the Croatian market for several years. Yet, the Croatian
authorities would not give it a license until the LB debt is settled, because KBC holds
a 34% stake in NLB.
NLB Group to Set up Two Companies in Serbia-Montenegro
One of the two companies will be a property fund and the other will offer voluntary
pension insurance
The NLB group, which includes Slovenia's largest bank Nova Ljubljanska banka
(NLB), plans to set up two companies in Serbia-Montenegro, the bank's chairman
Marjan Kramar told a Slovenian Business Club meeting as he presented NLB's results
and plans.
One of the two companies will be a property fund and the other will offer voluntary
pension insurance, Kramar told some 300 representatives of Slovenian companies in
Serbia-Montenegro in Belgrade on Thursday, 23 February.
Although it is Slovenia's largest investor in SE markets in Serbia-Montenegro, the
NLB group is by no means the largest financial group there, and it never will be, as
some competitors are much stronger, he said.
However, the group does have certain advantages, such as understanding its former,
present and potential new clients. It is also better acquainted with the past and present
market trends than the competition, he added.
The NLB group, with a 7% share of the Serb market, is already the majority owner of
the banks LHB Banka Beograd and Novi Sad-based Continental banka. It moreover
has a network of subsidiaries there, which it intends to further expand.
Meanwhile, the group's members operate successfully on the Serb market, including
NLB Leasing Beograd, as well as Prvi Faktor Beograd and LB InterFinanz Beograd,
which deal with financing international trade.
As Kramar said, the NLB mainly focuses on nearby markets in Austria, Germany,
Italy, Slovakia, Switzerland, the Czech Republic, Bulgaria and the countries of former
Yugoslavia.
According to NLB, Slovenia invested EUR 2.2bn abroad in 2004, 10% of which was
contributed by the NLB group. Meanwhile, 59% of these investments were in the
markets of former Yugoslavia, 25% in the EU market and 16% elsewhere.
The meeting of the Slovenian Business Club marked the third year since its
foundation. It was also attended by Slovenian Ambassador to Serbia-Montenegro
Miroslav Luci.
Minister Promises Simpler Tax Laws; No Final Word on Flat Tax
The ministry will strive to streamline tax legislation and make it more user-friendly,
Finance Minister Andrej Bajuk told the press
Finance Ministry officials have promised that one of the priorities of future changes to
tax legislation will be to simplify tax procedures.
The ministry will strive to streamline tax legislation and make it more user-friendly,
Finance Minister Andrej Bajuk told the press on Friday, 24 February.
However, Bajuk added that there was no final decision yet on whether the new system
would indeed incorporate a flat tax rate as proposed by the government reforms team.
The Finance Ministry is currently carrying out an analysis of what flat tax will bring
in a bid to allow for a rational decision on the proposal, he explained.
According to him, future tax legislation will by all means reduce tax progressiveness,
although it is not yet known whether it will completely eliminate it. "This is a
question of maths," he added.
His comments come in response to a large number of questions the Tax
Administration (DURS) has received in the past weeks regarding the personal income
tax return.
According to Bajuk, tax payers have addressed nearly 70,000 questions regarding the
tax return so far, with more expected ahead of the 31 March deadline for filing the
form.
DURS director Ivan Simic said that most of the questions are related to who must file
a tax return and about tax breaks.
Simic stressed that the instructions for the tax return are not to blame for the large
number of queries but rather the tax legislation, which is extremely complex.
Despite the government-sponsored amendments that were passed in parliament late
last year, the laws adopted by the previous government are still very complex, Bajuk
said.
Bajuk explained that the current government could not afford to make more radical
changes to the legislation last year because of fears that this could jeopardise
Slovenia's efforts to adopt the euro in 2007.
Future reforms of the tax system will be directed at simplifying regulations and
procedures, Bajuk pledged.
Probanka Posts EUR 4.17m Profit in 2005
Probanka, a small private bank from Maribor, is pleased with 2005 business results,
as consolidated profit topped SIT 1bn (EUR 4.17m), a 15% increase year-on-year
Probanka, a small private bank from Maribor, is pleased with 2005 business results, as
consolidated profit topped SIT 1bn (EUR 4.17m), a 15% increase year-on-year.
The bank increased its market share, which amounted at the end of 2005 to 2.2% on
the banking market, 5% for stock broking and 6% for mutual funds, a press release on
Thursday, 23 February, reads.
"Our estimates show that we also increased productivity last year by almost 20%.
This is a result of Probanka's IT system, a product of our own staff and know-how, as
well as the use of good market opportunities," CEO Romana Pajenk said.
Probanka generated a 9% return on equity last year. Within the financial group
Probanka, which increased its consolidated revenues in 2005 by 17%, the bank was
the most successful entity.
The bank's new challenge is Slovenia's entry into the eurozone, which Probanka will
start preparing for next week. As of 1 March, sums on all bank statements for retail
customers will be written in euros.
Finance and Monetary Policy Committee Approves Succession Bill
The parliamentary finance and monetary policy committee unanimously passed the
government-sponsored amendments to the bill on succession and the high
representative for succession
The parliamentary finance and monetary policy committee unanimously passed the
government-sponsored amendments to the bill on succession and the high
representative for succession as it met in Ljubljana on Thursday, 23 February
The amendments, which will be fast-tracked through parliament, come after the
Constitutional Court declared the current act on the transformation of the succession
fund unconstitutional and asked the legislator to amend it appropriately until the end
of 2005.
However, since the legislator has failed to rectify the established irregularities, all
procedures (which were frozen under the succession fund act) could start anew.
According to the government, this could cause severe damage to the defunct LB and
the Nova ljubljanska banka (NLB), in view of the proceedings in Slovenia as well as
the process launched at the European Court of Human Rights by Croatian account
holders.
The committee therefore adopted an amendment to Article 23 of the bill which calls
for such procedures to remain frozen, until the issue of receiving guarantees by the
former Social Federative Republic of Yugoslavia (SFRJ) or the former joint country's
Central Bank for such accounts is resolved.
Once the bill is signed into law, court procedures will be suspended again until there
is a comprehensive solution to this issue at the Basel Bank for International
Settlements (BIS), government representatives told the committee.
The committee also amended Article 9 of the bill, by saying that the fund must report
about its activities to the National Assembly.
Under the bill, the succession fund will be a public fund in charge of dealing with
succession issues. The legislation also regulates the status of the high representative
for succession - Miha Pogacnik was appointed to the post last April and will now
have full powers.
The aim of the bill is to regulate the implementation of the framework agreement on
succession, signed by five successors to the SFRJ in June 2001. Slovenia ratified the
agreement in July 2002.
Government Adopts 2006-2007 Plan for Capped Prices
According to Economics Minister Andrej Vizjak, the programme is a continuation of
the current restrictive macroeconomic policy
The government has adopted the 2006-2007 plan for administered prices, which
determines the prices than may be raised and the dates of price hikes. According to
Economics Minister Andrej Vizjak, the programme is a continuation of the current
restrictive macroeconomic policy.
The government will pursue two objectives in particular this year and next: making
sure that overall administered prices rise slower than free prices, and keeping the
hikes in individual administered prices in line with the free-price trends, Vizjak
explained.
For prices that providers determine in conjunction with independent regulatory
authorities, the government expects to be consulted before decisions are taken so that
their impact on inflation can be evaluated, the minister explained.
According to the programme, retail prices of electricity can rise by 1.6% this year.
Rail fares can go up by 2.3%, while the license fee for the national broadcaster RTV
Slovenia will remain unchanged this year and next.
Vizjak also promised the government would not tweak margins for petrol retail, but
allowed for the possibility that motorway toll increases by 1% on 15 March.
According to Vizjak, the Bank of Slovenia will be informed about the programme so
that it can continue to coordinate macroeconomic policies with the government.
Ljubljana Stock Exchange
The main SBI 20 index was, except one day, on the losing side, closing 42.28 points
down on the week at 4,517.49
Falling prices dominated trading on the Ljubljana Stock Exchange (LJSE) last week.
The main SBI 20 index was, except one day, on the losing side, closing 42.28 points
down on the week at 4,517.49.
The SBI 20's negative trend was mirrored by the PIX investment fund index, which
lost 22.16 points to 3,877.02, and the BIO bond index, which dropped 0.31 points to
121.10.
Stock brokers closed 5,372 deals on a turnover of SIT 4.7bn (EUR 19.6m), 28% of
which was accounted for by block deals.
Also this week, drug maker Krka was the busiest blue chip, accounting for SIT
683.4m (EUR 2.85m) without block deals. Krka, which announced its plan of a 13%
growth for this year, dropped 0.09% to SIT 117,317 (EUR 489.71).
Retailer Mercator followed in terms of volumes with SIT 522.8m (EUR 2.18m), but
gained 1.6% to SIT 37,809 (EUR 157.82). The other two busiest shares were fuel
trader Petrol and home appliances group Gorenje.
While Petrol edged up 0.25% to SIT 70,178 (EUR 292.94) on a turnover of SIT
495.8m (EUR 2m), Gorenja lost 1.5% to SIT 5,327 (EUR 22.24) on SIT 171.8m
(EUR 717,100).
Gorenje finished 2005 with a net profit of SIT 5.1bn (EUR 21.29m), which is 0.8%
more than a year earlier and in line with plans, the company said on Friday, 24
February.
The group generated net revenues of SIT 243bn (EUR 1.01bn), up 12.4% over 2004
and 3.4% above plans. Gorenje said the forecast-beating results came despite hard
market conditions.
The other shares were not as attractive to investors last week. Nevertheless, brewer
Pivovarna Lasko still managed to turn over SIT 81.9m (EUR 341,868), yet lost 0.86%
to SIT 7,339 (EUR 30.63).
Despite hard market conditions, the brewer retained its leading position in Slovenia,
increasing beer sales by 2%. The company said on Wednesday, 23 February that its
net profit went up 7.1% year-on-year to SIT 1.3bn (EUR 5.42m), while revenues fell
1% to SIT 18.3bn (EUR 76.39m).
Bonds too accounted for some action on the market; the state-run Slovenian
Restitution Fund (SOD) of second issue was the busiest, and turned over SIT 335.4m
(EUR 1.4m).
Foreign Exchange
Mean exchange rate of he Bank of Slovenia
Euro (EUR) - SIT 239.56 (+0.00)
U.S. dollar (USD) - SIT 201.29 (-0.50)
Swiss franc (CHF) - SIT 153.45 (-0.02)
British pound (GBP) - SIT 352.19 (+1.95)
REGIONAL INFORMATION
Ministers Promise State Support for Lower Podravje Region
The state has already invested a lot of money in the Podravje region and moreover
intends to increase the funds for regional development in 2006
The state has already invested a lot of money in the Podravje region and moreover
intends to increase the funds for regional development in 2006, Education Minister
Milan Zver told the press on Wednesday, 22 Februaty as the government visited the
region to take a closer look at its development problems.
Indeed, the lower Podravje region submitted 13 regional development projects worth
SIT 608m (EUR 2.53m) for 2006. It is moreover well incorporated in the Single
Programming Document with 47 projects worth SIT 1.3bn (EUR 5.42m), he said in
Ptuj.
However, the region's economic development is below the country's average. Lower
Podravje is also facing demographic problems and has a below-average education
structure, Zver said.
The lower part of Podravje, visited by the cabinet on Wednesday, 22 February, is the
region which is the most dependent on welfare aid. The state paid out SIT 8.8bn
(EUR 36.73m) of such aid in 2005, he added.
The region's registered unemployment rate moreover stood at 12.9% in November,
almost three percentage points above the country's average, he said.
In contrast, lower Podravje ranks above the Slovenian average in exports, especially
because of several successful and large companies, he pointed out.
Meanwhile, Environment minister Janez Podobnik said that the government pledges
to bring drinking tap water to all households in the region by the time the new EU
spending plan runs out in 2013.
Podobnik added that the first phase of a massive cohesion project to protect the water
sources in the area of Dravsko polje has already been given the green light by the
European Commission.
The project, which will be co-funded by the EU to the tune of 65%, includes
constructing a water distribution network and water treatment plants in the heavily
agricultural area.
Transport Minister Janez Bozic meanwhile told the press that the construction of the
Slovenian section of the trans-European Pyhrn motorway is proceeding as planned.
According to Bozic, several projects on the section are already underway, especially
the EUR 224m 10.5-kilometre part between the village of Pesnica and Maribor.
Also on the priority list is the construction of the 19-kilometre section of the SlivnicaDrazenci route, which will cost EUR 267m, he revealed.
Bozic also said that the electrification of the rail section between the transport hub of
Pragersko and the border crossing with Hungary in Hodos will begin in 2006 and
finish in 2009.
BRANCH INFORMATION
Tourism Strategy: 3.3 Million Visitors by 2011
Slovenia's 2007-2011 tourism development strategy aims at increasing the number of
visitors to the country by 6%
Slovenia's 2007-2011 tourism development strategy aims at increasing the number of
visitors to the country by 6% to 3.3 million by 2011, the Economics Ministry said on
Monday, 20 February.
The plan moreover calls for increasing the number of overnight stays by 4% to 9.7
million and foreign currency cash inflow by 8% to EUR 2bn, representatives of
tourism companies were told by the ministry
The director of the tourism directorate at the ministry Marjan Hribar said that the
goals of the existing 2002-2006 tourism strategy were not met.
According to the document, the tourism industry should net a total of EUR 1.6bn by
2006 and generate 9 million overnight stays, while the actual numbers in 2004 stood
at EUR 1.31bn and 7.56 million overnight stays, respectively.
Hribar added that the new strategy is supposed to define an effective development
model for the country's tourism sector. The document is moreover based on a
quantitative and qualitative analysis of the current state and clearly sets down the
measures to reach its targets.
Slovenia's comparative advantages in the new plan are its diversity, nature, food and
wine, and hospitality, said Maja Uran of the Portoroz College of Tourism.
"We want to remain pristine and authentic, and present ourselves as one of the last
undiscovered destination in Europe," added the head of the group which helped in
drafting the new strategy.
EU Unhappy with Situation on Slovenian Telecoms Market
The European Commission has expressed dissatisfaction with the regulatory and
competitive conditions on the Slovenian telecommunications market in a report on the
state of electronic communications markets across the EU
The European Commission has expressed dissatisfaction with the regulatory and
competitive conditions on the Slovenian telecommunications market in a report on the
state of electronic communications markets across the EU.
A number of regulatory and competition-boosting measures had been planned for
2005, yet they have been held back by factors such as low prices and the status of the
main operators on the fixed and mobile communications market, says the report
which was published on Monday, 20 February.
The report reminds Slovenia that it should have ensured number portability on 1 May
2004 but has only started to introduce mobile number portability this year, while fixed
number portability is still not possible.
In addition, the Commission is concerned with the independence of the market
regulator, considering that the state has stakes in the largest fixed and mobile
operators.
The Commission launched three procedures against Slovenia last year. It has already
received explanations from the Slovenian authorities, but sources in the Commission
said that the EU was still not happy with the state of affairs in number portability.
Besides the delay, the Commission is also unhappy with Slovenia's implementation of
number portability. It said that the country's alternative operators voiced their
discontent with the procedure of selecting the country's central phone number
database manager.
The procedure was launched by the Agency for Post and Electronic Communications
(APEK), which is still - although all operators stated that its readiness to act has
improved - a target of criticisms. The Commission moreover believes that the
regulator's measures were not timely.
The Commission also lambasted the lack of competition on the fixed and mobile
communications markets, with the leading operator (Telekom Slovenije) having a
96% market share of the fixed telephony market.
The situation on the mobile market is a bit better, with the country's leading operator
(Mobitel), holding 74% of the market. The Commission moreover believes that
number portability would be the most beneficial for the country's second-largest
operator.
The Commission was the most pleased about the state of broadband Internet
connections, with cable and wireless technologies accounting for 37% of the market,
giving the consumers a sufficient level of choice.
Furthermore, the price of fixed line telephony in Slovenia are among the lowest in the
EU. This itself would not have presented a problem if it was a consequence of
competition. However, the Commission states that the government keeps the prices in
check because of the planned 2007 euro changeover.
APEK head Tomaz Simonic meanwhile said that the agency has in the past year been
actively dealing with the deficiencies that have been correctly ascertained by the
Commission.
Simic, speaking after a preliminary review of the Commission's report, added that the
agency regulated retail prices at the telecommunications market, unbundled ADSL
from ISDN as well as took prompt action in the dispute between ISP T-2 and the
national telco.
While mobile number portability has already been implemented in the beginning of
2006 (a period not covered by the Commission's report), fixed line portability will be
implemented by June as announced, he explained.
Meanwhile, Mobitel welcomed the report, which includes "observations by other
mobile operators as well as the changes in the functioning of Mobitel".
The company is moreover pleased that "the report took into account the rulings of the
Competition Protection Office (CPO), which has rejected all charges of monopolistic
behaviour by the company."
Slovenia's second-largest operator, Simobil, agreed with the Commission's findings
and called on the country's authorities to take them to heart and allow a normalisation
of the mobile communications market.
Retailers Pull Out of Collective Bargaining Agreement
Slovenian retailers have announced they are pulling out of the collective agreement in
the retail sector in order to launch talks on shop opening hours
Slovenian retailers have announced they are pulling out of the collective agreement in
the retail sector in order to launch talks on shop opening hours.
The announcement was made on Tuesday, 21 February by the Trade Association at
the Chamber of Commerce and Industry of Slovenia (CCIS) and the Employers'
Association of Slovenia.
The collective bargaining agreement for the sector was supposed to be valid until 31
December of this year, but the employers decided to pull out in order to start
negotiations on a new agreement that would also deal with shop opening hours.
Chief negotiator for the employers Bostjan Grom said the aim of the move was to
speed up talks that would lead to a new agreement, which would include shop
opening hours.
"Regulations on opening hours do not belong in the trade act," Peter Zavrl of the
Association for Retail told the press.
He said that a CCIS survey among 218 retailers found that more than half feared their
revenues would fall by at least 10% as a result of a Sunday shopping ban
implemented in the trade act but recently stayed by the Constitutional Court.
Moreover, Grom explained that a number of the provisions in the collective
agreement were in discord with the labour act, another reason a new agreement
needed to be reached.
Poultry Producer Expects Determined Actions on Bird Flu
Poultry breeder Perutnina Ptuj's chairman Roman Glaser told Minister Lukacic, who
made a stopover at Slovenia's largest poultry producer as part of the cabinet's visit to
lower Podravje, that the sector will face serious difficulties due to the recent bird flu
outbreak in Slovenia
Poultry breeder Perutnina Ptuj expects the state and the EU to act in a determined
manner regarding bird flu, chairman Roman Glaser told Agriculture Minister Marija
Lukacic on Wednesday, 22 February.
Glaser told Minister Lukacic, who made a stopover at Slovenia's largest poultry
producer as part of the cabinet's visit to lower Podravje, that the sector will face
serious difficulties due to the recent bird flu outbreak in Slovenia.
He is moreover convinced that the companies will be unable to compensate for the
drop in sales by themselves; the company is currently experiencing a 15% drop in
sales.
According to Glaser, various measures should be taken to convince customers that
consuming heat-treated poultry is completely safe.
Lukacic meanwhile said that the state has only limited legal possibilities to
compensate breeders and food-processing companies.
She also pointed out that she has proposed at the recent meeting of EU agriculture
ministers that EU provide compensation payments for breeders and the food industry.
Lukacic moreover asked that payments be expanded to companies that export to the
countries outside of the bloc, and called for an EU-sponsored public awareness
campaign to inform consumers that it is safe to eat cooked poultry.
The Perutnina Ptuj group is one of the biggest employers in the region, having over
2,400 workers (1,900 in Slovenia alone).
It also cooperates with 450 breeders. If the state does not help the company, it should
at least help them, Glaser said.
The company instituted the strictest possible measures in breeding poultry in 2005
and maintains regular contact with the veterinary administration.
Glaser also said that an expert group, including Perutnina Ptuj representatives, would
be set up by the ministry next week in order to determine the exact amount of
damages caused by bird flu in Slovenia.
Talks on Shop Opening Hours Bogged Down
Negotiations between retailers and trade unions on the opening hours of shops are
bogged down due to the employers' recent pull-out from the collective bargaining
agreement for the sector effective at the end of this year
Negotiations between retailers and trade unions on the opening hours of shops are
bogged down due to the employers' recent pull-out from the collective bargaining
agreement for the sector effective at the end of this year.
The two sides held talks on Thursday, 23 February, but employers insist on the
withdrawal whereas the trade unions want a reversal of the decision.
"The withdrawal makes it harder to resolve this burning issue," said Economics
Minister Andrej Vizjak, the mediator in the talks, adding that the two sides were
entrenched in their positions. "Employers could have acted more wisely and
tactfully," he stressed.
According to Vizjak, the next round of talks is scheduled for Thursday. Until then
both sides are to specify their positions on the pull-out.
Peter Zavrl, the chair of the Association of Retailers at the Chamber of Commerce
and industry of Slovenia (CCIS), said the retailers insist on their withdrawal, but will
discuss the matter in more detail by the next round of talks.
Meanwhile, the unions see the retailers' move as "merely an intention, whereby the
actual pull-out can follow in three months," according to Ladislav Kaluza, the
secretary of the Retail Workers' Trade Union.
"If we clarify certain issues by next Thursday, we will resume talks, but we certainly
don't have the mandate to decide on how negotiations will proceed" as long as the
collective agreement is in the air, Kaluza said.
The retail trade union at the confederation KS 90 shares the view that the employers
should revoke the cancellation of the collective agreement, for they have no
substantiated reason to do so, according to Tinka Jamnik of KS 90.
Vizjak was convinced that the opening hours of shops is a matter that should "not be
pushed into the future", nor should it be treated along with the many open issues in
the collective agreement.
Despite the failed talks, Vizjak is determined to "push on and hope that we will
manage to move things along."
The retailers pulled out of the collective agreement, which would be valid until 31
December, on Tuesday, 21 February, in order to start negotiations on a new
agreement that would also deal with shop opening hours.
The retailers insist that shop opening should be regulated in the collective agreement,
not the trade act.
Second Case of H5N1 Confirmed in Slovenia
The Agriculture Ministry has confirmed the second case of the H5N1 strain of bird flu
virus in Slovenia, this time on a grey heron
The Agriculture Ministry has confirmed the second case of the H5N1 strain of bird flu
virus in Slovenia, this time on a grey heron. The bird was found at Duplek, east of
Maribor and a few kilometres downriver from where the first case - that of a swan had been confirmed.
Since Duplek had been designated an outbreak site when the grey heron was
suspected of carrying the virus, no additional measures needed to be taken, explained
Vida Cadonic Spelic, the head of the National Veterinary Administration (VURS).
"The only new thing we have is that an infected heron has now been confirmed in
addition to the swans," she explained to the press.
Moreover, the National Veterinary Institute said on Friday, 24 February that the
presence of the H5 virus has been confirmed in three more swans, bringing the total
number of H5 cases to 13.
Two of the swans were found at the Koroski most, a bridge near the centre of Maribor
just downstream from where the first H5N1 case was detected. The third bird was
found at Starse, further downstream from Maribor.
As a result of the find, the National Centre for Disease Control set a new 3 km
quarantine zone and a 10 km prevention zone around Starse, which was on the edge of
the zone around Duplek.
"It is worrying that the risk area has spread towards Ptuj, a territory where there are a
lot of poultry farms," said Cadonic Spelic.
COMPANIES
Maos Raises Bid for Iskra Again
Maos has raised its takeover offer for electronics conglomerate Iskra by one tolar to
SIT 1.311 (EUR 5.47) per share, thereby extending the validity of the offer by 6
March
Maos has raised its takeover offer for electronics conglomerate Iskra by one tolar to
SIT 1.311 (EUR 5.47) per share effective on Monday, 20 February, thereby extending
the validity of the offer by 6 March.
Maos, owned by 50 leading Iskra managers, is thus persisting in its battle to take
control of the Ljubljana-based company even though car electronics manufacturer
Iskra Avtoelektrika has withdrawn the original hostile bid that prompted Maos to act.
The fate of the offer is unclear: Iskra's biggest owners, the state-run Restitution Fund
(SOD) and Pension Management Fund (KAD), have rejected previous offers by Maos
and the rival bid by Iskra Avtoelektrika.
They had labelled the offers too low, but said they might sell their stakes at an
"appropriate price". KAD owns 28% of Iskra and SOD 13%.
The battle for the takeover of Iskra begun in mid-December when Iskra Avtoelektrika
published its original takeover bid, offering SIT 1,044 (EUR 4.36) per share.
Iskra's management, angered by the moves of a company that it partly owns,
responded to the hostile all-cash bid by establishing a company that put forward a
counter bid of SIT 1,100 (EUR 4.59) per share on 29 December. The bid was later
raised to 1,310 (EUR 5.47).
Outbid by Iskra's managers, Iskra Avtoelektrika announced in early February that it
was pulling out of the bidding, as it considered the price too high.
Competition Protection Office Approves Acquisition of Lama by Titus International
Titus had signed a contract on the purchase of 78.41% of Lama with the Slovenian
bank Banka Koper in December
The Competition Protection Office (CPO) cleared on Monday, 20 February, the
acquisition of Slovenian fittings producer Lama Dekani by Titus International, one of
the world's leading furniture fittings manufacturer.
Titus had signed a contract on the purchase of 78.41% of Lama with the Slovenian
bank Banka Koper in December. It paid EUR 1.515 per share or around EUR 2m for
the entire stake.
In early January the company then published a takeover bid, offering EUR 1.516 per
share for all other outstanding shares.
Adria Sends Leased Cargo Plane Back to Aurora Airlines
According to the carrier, the main reason for the move was the fact that the plane's
owner Aurora Airlines has failed to get all the necessary operating permits for the
aircraft
National flag carrier Adria Airways has decided not to use the Embraer cargo plane,
one of the two turboprop planes which it recently leased in a bid to get the company
out of the red, Adria told STA on Monday, 20 February.
According to the carrier, the main reason for the move was the fact that the plane's
owner Aurora Airlines has failed to get all the necessary operating permits for the
aircraft.
Adria Airways is therefore now looking for alternatives for leasing a new cargo plane,
which could start flying before 1 March, the company also told STA.
The Embraer was scheduled to start operations at the beginning of February, however,
Adria's supervisory board later decided to wait until 1 March for the plane to be
ready.
If Adria fails to launch the planned daily cargo route between Ljubljana and
Frankfurt, Zagreb and Sarajevo by 1 March, the already struggling carrier would lose
a large chunk of revenues.
Franc Branko Groselj, the head of Adria's supervisory board, said that the contract
with Aurora Airlines will be annulled, while in his view the head of Adria's
management board Iztok Malacic should also be made responsible for the decision to
lease the Embraer.
Court Approves Administration for Iskraemeco
The Kranj-based company, which owes SIT 14bn (EUR 58.43m) to its creditors,
including SIT 8bn (EUR 33.4m to banks, will have three months to draft a
restructuring plan, while creditors have a month to register their claims
The Kranj District Court on Monday, 20 February approved bankruptcy protection
proceedings at cash-strapped meter maker Iskraemeco.
The Kranj-based company, which owes SIT 14bn (EUR 58.43m) to its creditors,
including SIT 8bn (EUR 33.4m to banks, will have three months to draft a
restructuring plan, while creditors have a month to register their claims, public
broadcaster Radio Slovenija said.
Iskraemeco chairman Karl Rozman told the press that the management was not
planning to file for bankruptcy or make large job cuts if the company successfully
carries out restructuring as part of administration proceedings.
The number of jobs that will have to go will depend on orders - and there has been
enough orders so far, Rozman said, adding that the company needed to find a strategic
partner.
Meanwhile, the broadcaster reported that production workers were worried about their
jobs.
According to the head of the in-house trade union, bankruptcy protection proceedings
have a habit of turning into bankruptcy proceedings. However, Joze Petek admitted
that there were no real reasons Iskraemeco should go into bankruptcy.
One of the Europe's leading producers of equipment and systems for energy
measurement has been experiencing a bad patch since 2004 due to falling prices of
meters.
The crisis culminated the previous week with Iskraemeco seeking bankruptcy
protection in a bid to carry out financial restructuring.
Gaming Chain Reports 24% Rise in Gross Revenues, 34% Rise in Profit
Slovenia's largest gaming chain has reported a 34% increase in net profit, which
stood at SIT 7bn (EUR 29.22m) in 2005
Slovenia's largest gaming chain has reported a 34% increase in net profit, which stood
at SIT 7bn (EUR 29.22m) in 2005. The Hit group made the profit on gross sales
revenues of SIT 66.5bn (EUR 277.55m), the company said in a press release.
The group's results were examined on Monday, 20 February, by its supervisory board,
which found them to be satisfactory.
According to the press release, the company paid a total of SIT 15.5bn (EUR 64.7m)
in gaming taxes to the state in 2005, a 22% increase on the year before. Together with
other taxes, the company contributed SIT 29bn (EUR 121m) to the state's coffers last
year.
Moreover, the company said it saw a 10% rise in visits at its gaming centres: 1.8m
guests visited its casinos, while the company generated 440,000 overnight stays at its
boarding facilities.
2005 a Hit for Gaming Chain, Its Chairman Says
The group saw its net profit increase 34% to SIT 7bn (EUR 29.22m) in 2005, while
gross sales revenues were up 24% to SIT 66.5bn (EUR 277.55m)
Slovenia's largest gaming chain hit the jackpot in 2005 as its results show, Hit
chairman Branko Tomazic said on Tuesday, 21 February in Nova Gorica.
According to Tomazic, the results speak of the best financial year ever for Hit. The
group saw its net profit increase 34% to SIT 7bn (EUR 29.22m) in 2005, while gross
sales revenues were up 24% to SIT 66.5bn (EUR 277.55m).
The results put the group among the biggest and most successful tourism firms in
Europe, Tomazic told the press, adding that Hit generated 15% of all of Slovenia's
foreign exchange inflow from tourism last year.
The company paid a total of SIT 15.5bn (EUR 64.7m) in gaming taxes to the state in
2005, a 22% increase on the year before. Together with other taxes, it contributed SIT
29bn (EUR 121m) to the state's coffers last year.
Gaming centres in Slovenia generated 92% of all revenues, with the rest coming from
centres abroad, foremost among them the Maestral Hotel in Montenegro.
Among the biggest current investments, the company is building a new hotel
alongside its Perla gaming centre in the western Slovenian town of Nova Gorica. The
hotel is scheduled to open at the end of this year.
Moreover, the company plans to launch a EUR 4m gaming parlour in March at the
Vrtojba/St. Andrea border crossing with Italy, while a gaming innovation centre is set
to be opened close by in the near future, Tomazic said.
Speaking about a US$ 700m joint venture planned with US casino operator Harrah's
Entertainment, Tomazic said that Hit had been excluded from negotiations between
the Slovenian government and the US company.
Meanwhile, Hit officials announced that they have decided to complain to the
European Commission about Austria's discriminatory ban on advertising of foreign
gaming chains.
Hit spokesperson Tilen Majnardi said the company expected that the Commission
would make sure that Austria implements equal rules for all gaming chains.
Minister Promises Assistance to Aluminium Processor Impol
Economics Minister Andrej Vizjak has promised the management of aluminium
processor Impol that the government would lend a hand in helping the company make
full use of its potentials
Economics Minister Andrej Vizjak has promised the management of aluminium
processor Impol that the government would lend a hand in helping the company make
full use of its potentials.
Minister Vizjak visited the Slovenska Bistrica-based company alongside Higher
Education, Science and Technology Minister Jure Zupan on Tuesday, 21 February.
Considering that the state owns 40% of Impol, talks also touched on possible strategic
partnership, with Vizjak saying a prospective partner should be from the same sector
and able to take upgrade operations in terms of final products or supply.
"At this point these are only plans that would help the company achieve synergy
effects," Vizjak said, adding that any ownership-related moves must boost Impol's
development.
Impol chairman Jerej Cokl told the press the company posted sales of EUR 300m last
year, with profits at about EUR 1.5m. He expects profits to soar considering that the
company has just completed a development cycle.
Talks moreover touched on Impol's operations in Serbia, where the company has had
difficulties with the authorities with its Seval subsidiary. "We hope the government
will help us...speed up certain agreements on energy," Cokl said.
Major Trimo Owners Gain Control of Company
The bidders - the bank Probanka, its leasing arm Probanka Leasing, investment firms
Medaljon and Zlata moneta II, and Trimo Investments - announced that they have
acquired the needed shares to raise their combined stake to over 50%
A consortium of five major owners of Trimo, the Trebnje-based maker of prefabricated construction components, have succeeded in their bid to gain control of the
company.
The bidders - the bank Probanka, its leasing arm Probanka Leasing, investment firms
Medaljon and Zlata moneta II, and Trimo Investments - announced in a press release
on Wednesday, 22 February that they have acquired the needed shares to raise their
combined stake to over 50%.
The bidders together owned 42% of Trimo prior to the takeover bid and needed to
acquire at least another 95,778 shares to raise their stake to over 50%.
Publishing their takeover bid at the end of January, the bidders managed to acquire
the needed shares only after raising the bid price from SIT 7,300 (EUR 30.47) to SIT
8,020 (EUR 33.48) on 17 February.
Having met their takeover goal, the bidders said they would not be extending their bid
past 17 March.
According to an agreement signed by the bidders, Probanka would become owner of
39.8% of the total shares owned by the companies, Medaljon would hold 32%, Zlata
moneta II 28% and Probanka Leasing and Trimo Investments 0.1% each.
Government Pledges Support for Restructuring of Ormoz Sugar Factory
Finance Minister Andrej Bajuk and Agriculture Minister Marija Lukacic have
pledged full government support for the restructuring plan under which Slovenia's
lone sugar factory in Ormoz would switch to biofuel production in 2007
Finance Minister Andrej Bajuk and Agriculture Minister Marija Lukacic have pledged
full government support for the restructuring plan under which Slovenia's lone sugar
factory in Ormoz would switch to biofuel production in 2007.
We have successfully negotiated that sugar beet will be grown in the area this year in
talks with the company's foreign owners and farmers, Lukacic told the press on
Wednesday, 22 February, as the cabinet visited the region of lower Podravje.
She moreover explained that under the recent EU reform of the sugar sector farmers
are entitled to direct payments from the EU to the amount of EUR 335 per hectare of
sugar beet. The amount will grow in the coming years, reaching EUR 612 per hectare
in 2013.
Lukacic therefore expects that many farmers will keep growing sugar beet in this
season.
Bajuk meanwhile said that the government would do everything it can to aid in
restructuring as the employees would otherwise be the biggest losers.
Ormoz factory CEO Jurij Dogsa explained that they did not discuss money, but rather
about the ways of restructuring.
It is, however, important that the country gets all the available EU funds. Dogsa
assessed that the costs of the restructuring would be between EUR 35m and 40m.
He cited a factory in Germany, which received EUR 190m for a similar investment,
out of which EUR 50m were in non-refundable funds.
Meanwhile economics and foreign ministers, Andrej Vizjak and Dimitrij Rupel,
visited Slovenia's leading bricks producer Opekarna Ormoz Wienerberger.
After the visit at the Slovenian subsidy of the Austrian brick-making giant
Wienerberger, Vizjak said that the company is an important European and world
manufacturer.
Therefore it is important to consider the "issue of concentration and possible state
measures to that effect," Vizjak said.
The company's CEO Marija Glavic meanwhile criticised the length of proceedings for
passing zoning laws.
She also believes that Slovenija is so small that strict enactment of competition rules
is not sensible in all cases.
Pivovarna Lasko Increases Net Profit by 7.1% in 2005
Brewer Pivovarna Lasko increased net profit by 7.1% in 2005 year-on-year, to SIT
1.3bn (EUR 5.42m), according to unaudited and unconsolidated results
Brewer Pivovarna Lasko increased net profit by 7.1% in 2005 year-on-year, to SIT
1.3bn (EUR 5.42m), according to unaudited and unconsolidated results released on
Wednesday, 21 February.
Revenues of Slovenia's largest brewer amounted to SIT 18.3bn (EUR 76.39m) in
2005, 1% down on 2004, the company said.
Despite unfavourable market conditions, the brewer managed to retain its leading
position in Slovenia, increasing beer sales by 2% in Slovenia.
In 2005 Pivovarna Lasko bought 186,400 shares of Ljubljana's Pivovarna Union
brewery from Dutch company Interbrew, Lasko's arch rival in the acquisition bid for
Slovenia's second largest brewer.
Paying SIT 91,000 (EUR 379.87) a share, Lasko now owns 95.1% of Pivovarna
Union. The entire deal was worth around EUR 70.8m.
In 2005 Lasko was also one of the companies involved in the controversial sale of
stakes held in Slovenia's largest retailer Mercator by two state-run funds.
In a deal worth around EUR 69.9m it acquired 440,891 shares of Mercator, securing a
13.7% stake in the grocer.
The group includes Lasko, Pivovarna Union as well as soft drinks subsidiaries Fructal
and Radenska.
The results were endorsed by the supervisory board, which also approved the 2006
guidance for the Pivovarna Lasko group, which calls for an increase in net profits of
11% and projects sales increasing by 6.4%.
Hit Supervisors Elect New Chairman
The supervisory board of Slovenia's largest gaming company, Hit, elected Viktor
Baraga of the state-run fund KAD chairman, as it held its maiden session
The supervisory board of Slovenia's largest gaming company, Hit, elected Viktor
Baraga of the state-run fund KAD chairman, as it held its maiden session in Nova
Gorica on Wednesday, 22 February.
Besides Baraga, Australia's honorary consul, the supervisors also elected government
representative Alojz Durn as deputy.
Hit's AGM elected three new members of the six-strong supervisory board in
December, voting for Rajko Harej of the state-run SOD fund, Baraga and Niko Jurca.
Government Appoints Tuerk Chairman of Power Utility Eles
The government has named Vitoslav Tuerk, acting chairman of power utility Eles,
full-fledged chief executive of the national grid operator for a four-year term
The government has named Vitoslav Tuerk, acting chairman of power utility Eles,
full-fledged chief executive of the national grid operator for a four-year term.
The new chairman said in a press release Thursday, 23 February that his activities
would be "much more carefully planned, high-quality and coordinated" than had been
the case under previous chairmen.
He said his main priorities would be to boost sales, cut costs and streamline business
processes, as well as coordinate cross-border electricity flows with the operators from
Italy, Austria, Switzerland and France.
One of the key issues will be how to stop the tide of uncontrolled transfers of
electricity through Slovenia, which jeopardise the stability of the supply system,
Tuerk said.
Tuerk was named acting chairman on 22 September, when the government dismissed
Vekoslav Korosec. He was the only one to apply for the 24 December job vacancy.
State-run Funds to Sell Their Share in Lip Bled
All potential buyers are invited to send offers by 8 April
The largest owners of Lip Bled, state-run funds KAD and SOD, have announced their
plan to sell their 33% stake in Slovenia's biggest exporter in the timber industry. All
potential buyers are invited to send offers by 8 April.
Lip Bled employs 670 people, who represent 32% of the company's ownership. The
company has been in financial trouble for some time, but made a profit of over SIT
205m (EUR 855,000) in 2004 and surpassed this figure by 8% last year.
Despite losing its largest customer, the German Moderne Bauelemente, last year, Lip
Bled still succeeded in making a profit thanks to intensive efforts to reduce the
company's dependence on this particular customer.
Nevertheless, Lip Bled chairman Alojz Burja is still not happy with the performance
because the company, whose main products are interior and exterior doors, wooden
floors and furniture, had not achieved its targets.
In a statement for STA on Friday, 24 February, Burja did not wish to comment the
possible withdrawal of KAD and SOD. He did say, however, that recent uncertainties
regarding the appointment of a new head of the supervisory board shed a poor light on
the company.
KAD and SOD are not obliged to sell their shares to any bidder, but if an agreement is
reached, it will be with the highest bidder.
Gorenje Meets Profit Target in 2005
Home appliance group Gorenje finished 2005 with a net profit of SIT 5.1bn (EUR
21.29m), which is 0.8% more than a year earlier and in line with plans
Home appliance group Gorenje finished 2005 with a net profit of SIT 5.1bn (EUR
21.29m), which is 0.8% more than a year earlier and in line with plans, the company
said on Friday, 24 February.
According to Gorenje's press release, the group generated net revenues of SIT 243bn
(EUR 1.01bn), which is 12.4% more than in 2004 and 3.4% above plans.
The group said that the forecast-beating results come despite difficult conditions on
the market.
According to the management, the European market - Gorenje's most important
export destination - continued to be weighed down by economic stagnation and low
consumer confidence.
Moreover, the company was hit by a weak US dollar and rising costs of raw materials,
forcing it to seek alternative suppliers and to increase the prices of its appliances.
The results were reviewed by the supervisory board of the group.
Mlinotest Posts Profits but Misses Targets
Mlinotest, the bread and pasta maker, increased profits by 2% year-on-year to SIT
223m (EUR 0.93m) in 2005
Mlinotest, the bread and pasta maker, increased profits by 2% year-on-year to SIT
223m (EUR 0.93m) in 2005, but missed the targets by 14%. The company is
nevertheless happy with the performance considering the difficult business conditions,
according to chairman David Nabergoj.
Net sales revenues amounted to SIT 5.8bn (EUR 24.2m), up 22% over the year
before, but like-for-like sales (excluding the acquisition of Mlinotest Peks) dropped
13% in the same period.
According to Nabergoj, Mlinotest has been hit by the arrival of an Austrian
competitor, with the adverse effect compounded by the price squeeze from retailers.
All subsidiaries of the Mlinotest group (in Croatia and Russia) posted profits, but the
Slovenian market still accounts for 89% of the sales.
To decrease its dependence on the domestic market, Mlinotest plans to beef up
activities on the Italian market by 2011, Nabergoj explained.
Construction Group Primorje Acquires Serbia's PZP Pozarevac
According to the Slovenian company, the acquisition, carried out in December, was
worth EUR 3.5m, with Primorje planning to invest another EUR 857,000 into
modernising the equipment of the Serbian company
Slovenian construction group Primorje has acquired 70% of the Serbian road
construction company PZP Pozarevac, Primorje told STA on Friday, 24 February.
According to the Slovenian company, the acquisition, carried out in December, was
worth EUR 3.5m, with Primorje planning to invest another EUR 857,000 into
modernising the equipment of the Serbian company.
PTP Pozarevac maintains the roads in NE Serbia and employs 330 workers, who own
the remaining 30% of the company.
Primorje plans to greatly expand the activities of the Serbian company, which
generated EUR 625,000 in revenues in 2005.
It wants PZP Pozarevac to become a general construction company, which would also
construct flats, waste treatment plants and prefabricated elements for the construction
of factories.
According to unconsolidated results, the Ajdovscina-based Primorje group generated
revenues of SIT 80bn (EUR 333.94m) and posted a profit on SIT 1bn (EUR 4.17m) in
2005.
French Want to Increase Stake in Ski-Resort Manager to over 50%
French company Transmontagne would like to increase its 14% share in ATC Kanin,
the Slovenian company managing the popular Alpine ski centre of Kanin in the
northwest of the country, to 51% by this summer
French company Transmontagne would like to increase its 14% share in ATC Kanin,
the Slovenian company managing the popular Alpine ski centre of Kanin in the
northwest of the country, to 51% by this summer.
Transmontagne is trying to reach this goal with the purchase of ATC Kanin's debts,
which are then turned into ownership stakes, the representative of Transmontagne
Group in Slovenia Franc Alain Furlani told STA on Saturday, 25 February.
The French company entered the Bovec-based ATC Kanin in October 2004, paying
EUR 400,000 for the 14% stake. At the time it said it intended to invest an additional
EUR 3m into the resort in the next five years.
The Slovenian government chose Transmontagne as the best bidder for a debt of SIT
174.3m (EUR 727,500) ATC Kanin owes the state.
Transmontagne is also in talks with two banks to purchase what ATC Kanin owes
them, said Furlani, but added that more details about the deals would be known in the
middle of March.
According to Furlani, the company intends to allocate around EUR 750,000 to
purchase the Slovenian company's debts and make it ready for fresh investments.
Talks are also underway with ATC Kanin's biggest owner - the state-run fund SOD
controls over a third of the company - to sell its stake.
Transmontagne would like to take part in the construction of a modern ski centre with
swimming pools, recreation and riding grounds planned by the municipality of Bovec.
The investment which would bring Bovec an additional 700 to 800 beds would cost
EUR 15m.
Apart from managing ski centres in Slovenia and France, Transmontagne Group also
runs ski slopes in Italy and Switzerland, and an indoor skiing centre in Dubai, the
United Arab Emirates.
Foreigners Interested in Largest Slovenian Publisher
Foreigners are interested in Mladinska knjiga, the chair of Slovenia's largest
publishing house
Foreigners are interested in Mladinska knjiga, the chair of Slovenia's largest
publishing house, Milan Matos, told the daily Delo on Saturday, 25 February but
refused to confirm or deny whether the bidder could be Italy's Mondadori.
Mladinska knjiga did expect to get offers, chiefly because "it is not successful only on
the Slovenian market but also abroad", stressed Matos.
According to the data from the Chamber of Commerce and Industry of Slovenia,
Mladinska knjiga controls 44% of the domestic publishing market, which is worth
around EUR 100m annually. The second largest publisher is DZS with 21%.
Matos said it would be difficult to say what kind of reactions a decision to sell
Mladinska knjiga would be met with, but he is aware that "not everyone would be
trilled" about it. The publisher celebrated its 60th anniversary last year.
He stressed, however, that the markets on which his company is present are already
being entered by large, chiefly German and Austrian, publishers. Moreover, the
largest Finnish publisher WSOY is entering the magazine market through Adria
Holding.
Matos is worried about a potential rise in the VAT for books as planned in the
government-sponsored reforms: "This would hit publishing hard," he said, adding that
books should not be mixed with just any other product.
"The Chinese can make our shoes, shirts can be made in Pakistan, but we ourselves
are responsible for books," said Matos, highlighting that a great majority of countries
have a special [reduced] VAT for books.
SLOVENIA IN BRIEF
Parliament Committee Endorses Division to Two Cohesion Regions
The parliamentary committee for local government and regional policy endorsed the
government's decision to divide Slovenia to two regions for the purposes of EU
cohesion funds, as it met in Ljubljana on Tuesday, 21 February.
Rode Naming Shows Pope's Confidence in Slovenia, Uran Says
Pope Benedict XVI has confirmed his trust in the Slovenian nation with the naming of
former Ljubljana Archbishop and Slovenian Metropolitan Franc Rode for the post of
cardinal, incumbent Ljubljana Archbishop Alojz Uran said on Wednesday, 22
February.
Justice Minister Sturm Meets Macedonian Counterpart
Slovenian Justice Minister Lovro Sturm exchanged experiences in the field of justice
with his Macedonian counterpart Meri Mladenovska Georgievska in Ljubljana on
Friday, 24 February.
Slovenia, Hungary Culture Ministers Sign Cooperation Agreement
Culture Minister Vasko Simoniti and his Hungarian counterpart Andras Bozoki met in
Budapest to sign an agreement regarding cooperation in education, science and
culture for the 2006-2008 period, the Slovenian Culture Ministry said on Friday, 24
February.