Slovenia Business Week no. 21, May 29th 2006
Table of Contents:
HEADLINES ................................................................................................................. 3
MPs Pass Chambers of Commerce Act ...................................................................... 3
Slovenian Bank System Stable, Report Finds ............................................................ 3
IMAD Finds Good Progress in Development ............................................................ 4
INTERNATIONAL COOPERATION .......................................................................... 6
Slovenian, Austrian Municipalities to Strengthen Cooperation ................................. 6
Japanese Ambassador Invites Drnovsek to Visit Japan.............................................. 6
Rupel Meets Counterparts from Macedonia and Bosnia-Herzegovina ...................... 6
Finnish Ambassador Says Chairing the EU Takes a Lot of Effort ............................. 7
Government Willing to Accept Repayment of Russia's Debt in Any Form ............... 8
Energy to Top Agenda of Russia Visit, Minister Says ............................................... 8
CEI Countries Stress Need for Further EU Enlargement ........................................... 9
EUROPEAN UNION .................................................................................................. 10
EU Presidency Top Priority of Slovenian Diplomacy, Says Rupel ......................... 10
Government Lifts Restrictions on EU Workers ....................................................... 10
FM: EU Needs One More Year for Reflection on Constitution ............................... 11
LEGISLATION ........................................................................................................... 12
Government Tweaks Act on Audit of Public Procurement Procedures ................... 12
STATISTICS/FORECASTS........................................................................................ 13
Survey Shows Slovenians Afraid Euro Will Raise Prices ........................................ 13
Business Sentiment Down in May............................................................................ 13
FINANCE .................................................................................................................... 14
PM Says Price Hikes Cannot Be Justified with Euro Switch ................................... 14
EBRD Interested in NKBM, Telco Privatisation ..................................................... 14
NKBM Supervisors Elect new Chief Supervisor ..................................................... 15
Subsidiary of Kaertner Sparkasse to Become Independent Bank ............................ 15
Ljubljana Stock Exchange ........................................................................................ 16
Foreign Exchange ..................................................................................................... 16
REGIONAL INFORMATION .................................................................................... 17
PM Promises Improvements to Infrastructure in Notranjsko ................................... 17
PM Says Tourism and Logistics Key for Development of Notranjska .................... 17
Pomurje Still Lagging Behind the Rest of Slovenia ................................................. 18
BRANCH INFORMATION ........................................................................................ 20
Power Producers Fear Lack of Emission Coupons .................................................. 20
Barbara Guncar Steps Down as Head of Tourist Board ........................................... 20
COMPANIES .............................................................................................................. 22
Telco Boss Believes Strategic Partner Not Necessary Yet ....................................... 22
Intereuropa Beats Targets in Q1 ............................................................................... 22
Apparel Manufacturer Mura Ends 2005 with Loss of EUR 1.41m .......................... 22
DARS Borrows EUR 75m ........................................................................................ 23
Port of Koper Signs Deal with Korean Logistics Company ..................................... 23
Mercator Doubles Q1 Net Profit .............................................................................. 23
Retailer Tus Entering Mobile Telecommunications Market .................................... 24
Defence Contractor to Build New Factory in Autumn ............................................. 24
Gorenje CEO Reveals Ambitious Expansion Plans ................................................. 25
Aerodrom Posts Double-Digit Growth in Sales, Profit ............................................ 25
Terme Catez Increases Q1 Net Profit by 23% .......................................................... 25
Bread and Pasta Maker Ends Q1 with EUR 1.3m Profit .......................................... 26
WAZ and DZS Sign Deal on Joint Venture ............................................................. 26
Hardware Retailer Merkur Increases Revenues by 25% in Q1 ................................ 27
Bostanj Hydro Plant Enters One-Year Test Phase ................................................... 27
SLOVENIA IN BRIEF ................................................................................................ 28
Slovenia to Follow EU Lead in Recognising Montenegro ....................................... 28
Slovenia Starts Talks on Full Membership in EUMETSAT .................................... 28
New European Future Centre Opens in Slovenia ..................................................... 28
Slovenia Presents Itself at a Theme Park in Germany.............................................. 28
Media Law Passed .................................................................................................... 28
Slovenia Offers Aid to Quake-Struck Indonesia ...................................................... 28
HEADLINES
MPs Pass Chambers of Commerce Act
The act that introduces voluntary membership replaces the Chamber of Commerce
(CCIS) act, which sets down mandatory membership of Slovenia's lone chamber of
commerce
Lawmakers passed the act on chambers of commerce on Friday, 26 May in a 47-to-22
vote. The act that introduces voluntary membership replaces the Chamber of
Commerce (CCIS) act, which sets down mandatory membership of Slovenia's lone
chamber of commerce.
The act moreover stipulates the founding, activities and abolishment of chambers of
commerce and defines a chamber of commerce as an independent, voluntary, interest
and non-profitable association of legal and private persons.
The government believes that the act will substantially increase the efficiency of
chambers of commerce, contribute to economic growth and facilitate the development
of appropriate programmes and activities.
The CCIS will become its own legal successor and could keep its name, with its
members free to decide whether they will remain the CCIS's members or opt for
joining a possible newly-established chamber.
Under the new legislation, the CCIS will have to amend its statute within five months
after the law enters into force.
The act states that the chamber will be treated as representative if its members
produce at least 10% of sales revenues in Slovenia and provided that it has at least 5%
of all companies that can become a chamber's member.
Such chambers will also contribute in forming the economic system and economic
policy and join international associations of chambers, but will not take part in social
dialogue talks. Estimates envisage two to three such chambers in Slovenia.
Slovenian Bank System Stable, Report Finds
An annual report on financial stability in Slovenia has found that the banking system
in the country is stable
An annual report on financial stability in Slovenia has found that the banking system
in the country is stable. "There has been little change in stability compared to 2004,"
the report compiled by the central bank says.
The Bank of Slovenia finds that there has been a rise in interest rate and loan risks but
that foreign exchange risk has fallen, Bozo Jasovic of the bank's board of governors
told the press on Tuesday, 23 May.
Asked about the risk that the withdrawal of Belgian banking group KBC from
Slovenia's largest bank, NLB, would have for the system, Jasovic said that the central
bank understands that KBC was not withdrawing but changing its ownership role.
"Theoretically there could be a risk of weakened corporate management but there is
no indication of this, which is why we don't expect financial stability to be impacted,"
he said.
Deputy Governor of the Bank of Slovenia Samo Nucic stressed that NLB would need
fresh capital. "The owners must be aware of this," Nucic said, adding that there was
"sufficient potential in Slovenia" to provide the capital.
However, given that Slovenia's second-largest bank, NKBM, is in the midst of
privatisation and that the government wants domestic investors to participate, there is
a question whether there is enough potential at home for both NLB and NKBM,
Nucic pointed out.
Meanwhile, Jasovic said that the report on financial stability for 2006 shows that the
rise in loans is a result of favourable economic conditions.
The profitability of banks increased despite falling margins, while there was also an
increase in the exposure of the banking sector to foreign factors, Jasovic told the
press.
According to Jasovic, interest-related risks to banks were on the rise last year,
although exchange rate risks fell because of Slovenian efforts to join the euro.
Jasovic warned that banks have started to lower their credit rating standards in the
face of growing competition, low interest rates and favourable economic conditions.
Meanwhile, Nucic said that the bank found almost no wrongdoing in the banking
sector last year. The central bank last year carried out 68 regular and 18 additional
checks in 22 banks operating in Slovenia, Nucic added.
The majority of the shortcomings were related to information systems, although
subsequent checks found that the situation had been rectified.
IMAD Finds Good Progress in Development
The government's macroeconomic think-tank has found "good progress" in Slovenia's
development in its annual development report
The government's macroeconomic think-tank has found "good progress" in Slovenia's
development in its annual development report.
"There has been good progress in development in macroeconomic and social stability,
while Slovenia is still lagging somewhat behind in terms of competitiveness," head of
the Institute of Macroeconomic Analysis and Development (IMAD) Janez Sustersic
told the press on Friday, 26 May.
In terms of welfare state indicators (unemployment, employment and poverty) and
macroeconomic indicators (total general government debt, inflation) Slovenia ranks
high among the EU member states, Sustersic said.
According to him, Slovenia can be proud of its achievements in these two fields.
Meanwhile, Sustersic hopes the upcoming switch to the euro will make Slovenia more
competitive.
Although Slovenia is bridging the development gap with the EU average, it is doing
so too slowly given the goals it set itself in the Development Strategy, Sustersic
added.
He believes that reforms will be needed to speed up economic growth and allow
Slovenia to meet its development goals.
According to Sustersic, IMAD paid more attention to the development role of the
state in this year's report, since international organisations have claimed that the role
of the Slovenian state is not sufficiently development-minded.
The government has took big an ownership role in companies and the solution lies in
privatisation, IMAD concludes in the document, adding that a big role for the state in
the economy does not help competitiveness.
According to the report, there is room for improvement in the taxation of capital and
environmental taxes, while the state spends a lot on welfare.
Moreover, the report finds that development in Slovenia was not balanced: economic
development lagged behind social and environmental development in the 2000 to
2004 period.
The report also finds that incoming investment were outstripped by outgoing
investment, which is unusual for a country like Slovenia. It also praises efforts to help
Slovenian companies go global.
Slovenia has untapped potential in business services and lags behind the EU in
financial services, especially banking, the report adds.
INTERNATIONAL COOPERATION
Slovenian, Austrian Municipalities to Strengthen Cooperation
The Association of Slovenian Municipalities and the Austrian Association of
Municipalities have held a meeting to discuss the creation or strengthening the
partnerships between the countries' local communities
The Association of Slovenian Municipalities and the Austrian Association of
Municipalities have held a meeting to discuss the creation or strengthening the
partnerships between the countries' local communities.
Representatives of the Slovenian association told the press in Maribor (NE) on
Monday, 22 May that the municipalities from both sides of the border also want to bid
for EU funds with joint projects.
Maribor Mayor Boris Sovic stressed that the Slovenian association has been actively
participating with its Carinthian and Styrian partners, adding that a similar meeting
was staged last year in Austria's Villach.
"One of the EU's priorities is promoting partnerships and active cooperation. We will
organise workshops to inform the municipalities on the existing possibilities within
EU projects," he explained.
"We do not expect only to draw EU funds, but also to create an added value to
improve the quality of life for people living on both sides of the border," added Sovic,
who is the president of the Association of Slovenian Municipalities.
The meeting presented several examples of good practice of cross-border cooperation
and discussed the possibilities of future inter-regional partnerships.
Besides representatives of the two municipality associations, the event was also
attended by delegations from the Austrian border provinces of Carinthia and Styria.
The project is already financed by the EU under its Town Twinning and Active
European Citizenship programme.
Japanese Ambassador Invites Drnovsek to Visit Japan
The residential Japanese Ambassador to Slovenija Tsuneshige Iiyama presented his
credentials to President Janez Drnovsek
The residential Japanese Ambassador to Slovenija Tsuneshige Iiyama presented his
credentials to President Janez Drnovsek on Tuesday, 23 May, and called again on
Slovenia's president to visit Japan.
According to a press release by the president's office, the pair assessed bilateral
relations as good, adding that they could be improved.
The ambassador also conveyed a message by the Japanese Emperor Akihito in which
he called for improving the friendly relations between the two states.
Iiyama listed developing economic cooperation and increasing mutual understanding
between the two countries as his priority tasks.
The pair also discussed the UN's future and the possibilities of a permanent seat at the
UN's Security Council for Japan, the press release also reads.
Rupel Meets Counterparts from Macedonia and Bosnia-Herzegovina
Foreign Minister Dimitrij Rupel held bilateral meetings with his counterparts from
Macedonia and Bosnia-Herzegovina respectively after the opening of the new Centre
for a European Future
Foreign Minister Dimitrij Rupel held bilateral meetings with his counterparts from
Macedonia and Bosnia-Herzegovina respectively after the opening of the new Centre
for a European Future, the Foreign Ministry said on Tuesday, 23 May.
Rupel and Macedonia's Ilinka Mitreva mainly talked about Macedonia's EU and
NATO accession, with the Slovenian minister assuring Slovenia's support in the
process.
Mitreva was pleased to point out the upcoming opening of hydro power, Sveta Petka
(Matka 2), Slovenia's largest investment in Macedonia, the press release also reads.
The meeting with Bosnia-Mavedonia's Maden Ivanic meanwhile focused on current
reforms in Bosnia-Herzegovina, according to the Foreign Ministry.
The pair also talked about the convention on the avoidance of double taxation which
Slovenian Finance Minister Andrej Bajuk and Bosnian Human Rights and Refugees
Minister Mirsad Kebo signed on 16 May.
Finnish Ambassador Says Chairing the EU Takes a Lot of Effort
Presiding over the EU is a challenging project which requires state bodies to invest a
lot of work on various levels, Finnish Ambassador to Slovenia Birgitta Cecilia Maria
Stenius-Mladenov has said in an interview for STA
Presiding over the EU is a challenging project which requires state bodies to invest a
lot of work on various levels, Finnish Ambassador to Slovenia Birgitta Cecilia Maria
Stenius-Mladenov has said in an interview for STA.
Finland will begin its six-month stint on 1 July, with Stenius-Mladenov stressing that
the country intends to put less money into its second stint as EU chair - by staging a
smaller amount of meetings in Finland - but not less effort.
Finland was chairing the EU for the first time in 1999, four years after it joined the
bloc. Stenius-Mladenov believes that it is much easier to chair the EU after you had
already done it before.
Finland's presidency programme was drafted in cooperation with Austria, EU's chair
in the first half of 2006, with the aim of taking the EU forward, she explained.
According to Stenius-Mladenov, the Finnish presidency will stress the
implementation of the Lisbon Strategy, while other priority issues include
enlargement, Western Balkans and relations with Russia.
The ambassador does not expect large shifts in the area of the European Constitution
during her country's presidency. Indeed, Finland has not yet ratified the document, but
it expects to do so in the second half of 2006.
Meanwhile, economic cooperation between Slovenia and Finland remains relatively
moderate, she said, adding that the best known Slovenian company in Finland is
household appliance maker Gorenje, appreciated by the Finns for its good quality-toprice ratio.
She also revealed that Finnish wood-processing companies are interested in
cooperating with Slovenian companies, as both countries have large potentials in the
field.
Finland faced a huge recession some 15 years ago, a consequence of the dissolution of
the Soviet Union, one of its important trading partners. Yet the country managed to
recover quickly and is considered as a role model in many fields, she pointed out.
She believes that Finland's model is interesting for numerous countries, including
Slovenia, yet stressed that the country invested a lot of effort in strengthening the
economy and education in the past decade.
Birgitta Cecilia Maria Stenius-Mladenov is Finland's first ambassador to Slovenia, as
the country only opened its embassy after Slovenia joined the EU in May 2004.
Government Willing to Accept Repayment of Russia's Debt in Any Form
"Slovenia is prepared to accept repayment of the old Soviet clearing debt in any form,
even cash," Finance Minister Andrej Bajuk told the press after the government's
session
"Slovenia is prepared to accept repayment of the old Soviet clearing debt in any form,
even cash," Finance Minister Andrej Bajuk told the press after the government's
session on Thursday, 25 May.
Bajuk also said that the cabinet did not change the stance of the previous government
on the possibility for Russia to pay off its debt in goods and services.
He moreover called for a prompt solution of the Russian debt issue, which will be
discussed at the end of this month by a Slovenian-Russian commission.
"Our Russian partners are in no hurry to solve the problem since no interest is being
levied on the debt, while Slovenian would like to settle this as soon as possible,"
Bajuk stressed.
The Slovenian cabinet, which is to start a visit to Russia on Monday, 29 May,
meanwhile backed an initiative for an agreement on cooperation between the
Slovenian and Russian defence ministries, authorising Defence Minister Karl Erjavec
to sign the document, the government's PR and Media office said.
According to the press release, the agreement will create a basis for the exchange of
views, experiences and information on issues which are of great interest to both
countries, strengthening mutual trust and international security.
Energy to Top Agenda of Russia Visit, Minister Says
Cooperation with Russian energy companies will top the agenda of the upcoming
high-ranking Slovenian visit to Russia
Cooperation with Russian energy companies will top the agenda of the upcoming
high-ranking Slovenian visit to Russia. Slovenia wants to secure a stable energy
supply, so the government supports cooperation between Slovenian and Russian
companies, Economics Minister Andrej Vizjak told the press on Friday, 26 May.
Vizjak, who will be accompanying Prime Minister Janez Jansa on an official visit to
Russia next week, therefore welcomed the recent talks between Russian oil company
Lukoil and Slovenia's Petrol, Nafta Lendava and Geoplin.
Vizjak also said he would hold talks in Moscow with the chief executive of the
world's biggest gas company, Gazprom.
Another item on the agenda will be the clearing debt of about US$ 129m that Russia
took over from the Soviet Union.
The minister said that the Slovenian side is going to Moscow with the proposal that
the debt be paid off with equipment for upgrades to steam power plants and overhead
power lines.
The officials will also discuss long-term contracts for gas supplies, which have run
out. Slovenia is looking to sign new contracts, he said.
The minister was speaking to the press before the fifth meeting of the Slovenia-Russia
intergovernmental commission on trade and economic as well as scientific and
technological cooperation.
The Slovenian delegation visiting Russia between 29 and 31 March includes Jansa
and Vizjak as well as Foreign Minister Dimitrij Rupel, Defence Minister Karl
Erjavec, Agriculture Minister Marija Lukacic and a strong business delegation.
CEI Countries Stress Need for Further EU Enlargement
Foreign ministers of the countries of the Central European Initiative (CEI) stressed
the need for further EU enlargement and discussed CEI's role in promoting regional
cooperation, as they met in Albania's capital of Tirana
Foreign ministers of the countries of the Central European Initiative (CEI) stressed the
need for further EU enlargement and discussed CEI's role in promoting regional
cooperation, as they met in Albania's capital of Tirana on Friday, 26 May.
They also called on accession candidates to fulfill the required EU standards, and
expressed their hope that Belarus will start respecting international principles and
values, shared by CEI countries, the Slovenian Foreign Ministry said.
Slovenia was represented at the meeting by State Secretary at the Foreign Ministry
Bozo Cerar, who according to the ministry stressed the need for continued EU
enlargement, labelling it one of Slovenia's priority tasks during its stint as EU chair in
2008.
He also presented the recently-opened Centre for European Perspective with which
Slovenia wants to help its neighbouring countries in joining the EU, and met Albanian
Foreign Minister Besnik Mustafaj at the meeting's sidelines, the ministry added.
The 17-member strong CEI has developed from a partnership, founded in 1989,
comprising Austria, Italy, Hungary and former Yugoslavia. Slovenia became its full
member in 1992, together with Croatia and Bosnia-Herzegovina.
A meeting of Adriatic-Ionian Initiative (AII), which took place at the same time,
passed the Tirana declaration which calls for EU and NATO accession of Western
Balkan countries. The meeting was attended by Slovenia's Ambassador to Macedonia
Marjan Siftar.
EUROPEAN UNION
EU Presidency Top Priority of Slovenian Diplomacy, Says Rupel
One of the main tasks of Slovenian diplomacy at the moment is to prepare for
Slovenia's presidency of the EU in 2008
One of the main tasks of Slovenian diplomacy at the moment is to prepare for
Slovenia's presidency of the EU in 2008. This will be a considerable burden for
Slovenia's diplomats and they will have to work flat out, said Foreign Minister
Dimitrij Rupel at a press conference marking Slovenian Diplomacy Day on Monday,
22 May.
The number of diplomats based in Brussels for the presidency will greatly increase
and they are already being trained for this purpose. The minister said. "I expect the
time of Slovenia's presidency will see discussions regarding the EU's future and the
EU constitution."
Rupel believes the problem of the constitution will be difficult to solve without the
French, so Slovenia will use its presidency to "bridge the gap" between Germany and
France.
The unresolved questions regarding the border with Croatia will not affect Slovenia's
presidency of the EU, the minister said. "Our standpoint will be the standpoint of all
EU members." He repeated the view that the time of Croatia's accession to the EU is
ideal for finding solutions to open issues.
Slovenia is also a member of the troika of the Organisation for Security and Cooperation in Europe (OSCE) this year. In June it will take over the presidency of the
Human Security Network. Amongst other tasks facing Slovenian diplomacy this year,
Rupel said it will have to do more in relations with neighbouring countries and
European relations.
Slovenian Diplomacy Day was first celebrated in 2004; 22 May was chosen to mark
the day in 1992 when Slovenia was accepted to the UN. According to the minister,
this marks Slovenia becoming an equal partner in the international community.
Slovenia has embassies in 37 different countries and consulates general in six. Rupel
said that Slovenia needs additional representative bodies abroad. "This is why the
wish for the EU to have a common diplomatic service is understandable," he added.
Government Lifts Restrictions on EU Workers
The Slovenian cabinet has decided to lift all restrictions on EU workers in line with
Slovenian efforts to see the principle of the free movement of labour implemented
across the EU
The Slovenian cabinet has decided to lift all restrictions on EU workers in line with
Slovenian efforts to see the principle of the free movement of labour implemented
across the EU.
According to a press release issued by the government following a session on
Thursday, 25 May, Slovenia is dropping the principle of reciprocity for labour
restrictions in the EU and the European Economic Area (EEA).
This means that workers from the old EU members (EU15) that have so far
maintained restrictions on Slovenian labour will no longer be subject to tip-for-tat
Slovenian restrictions.
The government maintains that the lifting of restrictions for workers from all EU
member states will not endanger the Slovenian labour market.
The decision is in line with the government's efforts to see the principle of the free
movement of labour implemented across the EU and EEA without exception, the
government added in its press release.
Slovenia had applied restrictions on labour from 12 old EU member states that chose
to put restrictions on Slovenian labour (together with the seven other EU newcomers
from central Europe) after Slovenia joined the EU on 1 May 2004.
Four of the 12 countries - Finland, Spain, Portugal and Greece - decided to lift the
restrictions for the newcomers as of 1 May of this year, following the initial two-year
transitional period.
Slovenia had been lobbying for all old EU member states to lift restrictions, claiming
this was beneficial for the competitiveness of the EU economy and was only right
given the EU's principle of the free movement of labour.
However, eight countries decided to keep enforcing the restrictions in one way or
another following 1 May of this year for a period of up to three years with the
possibility of another two-year extension after that.
The government will now inform the National Assembly of its decision and task the
Ministry of Labour, Family and Social Affairs to suitably change the legislation.
Data from the Employment Office shows that 454 EU15 or EEA citizens were
employed in Slovenia on 30 April of this year. Most are highly-skilled workers who
are employed as high-ranking representatives of foreign companies in Slovenia.
FM: EU Needs One More Year for Reflection on Constitution
Slovenian Foreign Minister believes that the period of reflection regarding the EU's
constitutional treaty needs to be extended
Slovenian Foreign Minister believes that the period of reflection regarding the EU's
constitutional treaty needs to be extended. "We need another year," he said on the
margins of a meeting of the EU's foreign ministers on Saturday, 27 May.
Minister Rupel has thus joined his counterparts from Austria and the Netherlands in
calling for an extension of the period of reflection, a year after France and the
Netherlands rejected the treaty in referendums, plunging the bloc into a crisis.
Rupel also called for continued enlargement of the bloc, saying that the process can
continue without the constitution. He said Croatia was bound to become a full-fledged
member, "but we have to resolve our (bilateral) issues in one way or the other."
In his support for enlargement, Rupel also thought that the EU should immediately
launch separate negotiations with the newly-independent Montenegro on an
association and stabilisation agreement.
LEGISLATION
Government Tweaks Act on Audit of Public Procurement Procedures
The government has adopted amendments to the act on audit of public procurement
procedures to limit the impact of appeals in public contracting
The government has adopted amendments to the act on audit of public procurement
procedures to limit the impact of appeals in public contracting. The move comes
following a bungled public tender for 18 operating tables for five hospitals that has
caused public outrage.
According to the amendment, an appeal by a bidder would not automatically halt the
procurement procedure in case this could jeopardise people's lives or health, Finance
Minister Andrej Bajuk told the press on Thursday, 25 May.
In such cases, it would be the government, which decides at the proposal of the
contracting party that an appeal does not halt the ongoing procurement procedure,
Bajuk explained.
The amendments, which are to be passed in emergency procedure, will address the
public sector's impotence when contracting parties encounter problems in the
awarding of contracts, he explained.
According to Bajuk, if the amendments were in force, the problem of the operating
tables would have been resolved long ago.
Bajuk also announced that legislation in this field was undergoing comprehensive
review, saying that the rigidity of the present system hampers the government's work.
The amendments had been announced by Health Minister Andrej Bajuk and PM Janez
Jansa after the National Review Commission, the public procurement watchdog,
annulled the public tender for the purchase of the 18 operating tables.
The public tender, bogged down by appeals, had led to emotional calls by the Institute
of Oncology in Ljubljana and President Janez Drnovsek for a resolution of the issue to
the benefit of the patients.
In the last surprise move, Medicoengineering, a medical supplies company which
failed in the tender, made an offer to donate and install the operating tables free of
charge and recoup the money through the donations of Slovenian companies.
STATISTICS/FORECASTS
Survey Shows Slovenians Afraid Euro Will Raise Prices
Almost two thirds of the 52.3% of Slovenians who expect the euro will bring problems
are afraid of price-hikes and 34.8% expect problems in converting between tolars and
euros
Almost two thirds of the 52.3% of Slovenians who expect the euro will bring
problems are afraid of price-hikes and 34.8% expect problems in converting between
tolars and euros, show the results of an opinion poll published by Dnevnik on
Monday, 22 May.
Just over a third (36.6%) of those polled believes Slovenia will benefit from the
introduction of the euro, while 43.8% thought the euro will cause no problems. Some
28% believe the common currency will have a negative impact on the country while
18.3% think the euro will have no significant effect.
Almost a third of Slovenians (32.6%) expect their social standing will become worse
following the euro takeover; only 4% believe it will improve. Some 51% are
convinced their social position will not change.
Just under 25% believe it is thanks to previous governments that the euro takeover has
come about so quickly, while 18.2% say it is the success of the current government.
Almost as many (18.5%) are convinced that all the governments so far can be thanked
for the success, while 9.6% ascribe the success to the Bank of Slovenia, according to
the survey carried out by the Ninamedia agency on 16 and 15 May which included
700 respondents.
Business Sentiment Down in May
The seasonally adjusted sentiment indicator deteriorated by 1 percentage point in
May, mostly due to the fall of confidence in manufacturing
The seasonally adjusted sentiment indicator deteriorated by 1 percentage point in
May, mostly due to the fall of confidence in manufacturing. The indicator was
nevertheless 5 percentage points higher than the year before and 7 points above the
long-term average, the National Statistical Office has said.
The 1 percentage point fall of the confidence indicator in manufacturing was
influenced by the fall of overall order-books and the rise of stocks of finished
products. Compared to May 2005 the indicator rose by 8 percentage points.
In retail the confidence indicator rose by 1 percentage point over the month before,
mostly due to the fall of the volume of stocks. The index was up 5 percentage points
year-on-year.
Meanwhile, the indicator rose by 4 percentage points in construction and services, the
indices 5 and 8 percentage points higher than last year respectively.
Optimistic forecasts of the general economic situation in the country over the next 12
months pushed the consumer confidence indicator 4 percentage points higher
compared to the previous month.
FINANCE
PM Says Price Hikes Cannot Be Justified with Euro Switch
The fears that Slovenia's adoption of the euro in 2007 would lead to price hikes is
unfounded, PM Janez Jansa said as "the value of a product remains the same,
regardless of the currency it is bought with"
The fears that Slovenia's adoption of the euro in 2007 would lead to price hikes is
unfounded, PM Janez Jansa said on Monday, 22 May as "the value of a product
remains the same, regardless of the currency it is bought with".
Jansa, answering questions from opposition lawmakers at the start of parliament's
regular May session, added that no price hikes could be justified by the fact that
Slovenia will change its currency.
Changing over to the euro is one of the steps that would allow Slovenia to achieve
greater macroeconomic stability in the long run, he added.
Jansa, answering a question by opposition National Party (SNS) MP Saso Pece on
how the government intends to keep the standard of living unchanged in case of
uncontrolled price hikes, explained that the euro switch would not endanger the
quality of life, indeed, it would do just the opposite.
He pointed out the stability of the tolar and the sufficiently long double-pricing period
as the factors that would allow the people themselves monitor the prices, especially
the lower ones, where the threat of upward rounding is the greatest.
EBRD Interested in NKBM, Telco Privatisation
An interview with Kurt Geiger, director of financial institutions at EBRD
The European Bank for Reconstruction and Development (EBRD) is interested in
taking part in the privatisation of NKBM, Slovenia's second largest bank, as well as
Telekom Slovenije. EBRD has been in discussion with the Slovenian government
over a possible role in the privatisation of NKBM for a year, Kurt Geiger, director of
financial institutions at EBRD, has said in an interview for STA.
"If the government and shareholders assess that we can contribute added value and
know-how in the privatisation process, EBRD can be a neutral, active minority
shareholder," Geiger told STA on the margins of the EBRD annual meeting in
London.
He said EBRD has known NKBM for a while, as the government had been looking
for a strategic investor five years ago. In the privatisation of Telekom Slovenije, "the
approach would be similar to that in NKBM," he said, adding that the procedures
could be carried out in parallel.
EBRD has been seen as a likely strategic partner for NKBM since the government
unveiled its privatisation programmes for the bank and the telco on 11 May. EBRD,
which had already taken part in the partial privatisation of NLB, the biggest bank,
would initially take a 20% stake in NKBM.
According to Geiger, if EBRD decides to take part in the NKBM privatisation, it
would create a strategy for improving the bank in conjunction with the other
shareholders. An agreement on future strategy is essential in EBRD's decision to take
part, he stressed.
"The state owns NKBM and Telekom, and it is the owner who takes decisions on
investors. It is important to attract high-quality investors," said Geiger, adding that
only such investments create jobs, generate progress and promote competitiveness.
Even though EBRD has carried out over 100 investments in the banking sector over
the past decade and has extensive know-how, Geiger stressed that it is impossible to
use the same pattern.
"We want to understand what NKBM needs, what the city of Maribor, the region and
the customers need and what we can contribute towards that," he said.
EBRD's portfolio, once heavily focused on Central and Eastern Europe, is gradually
shifting towards SE Europe, Russia, Ukraine and the Caucasus. Yet this will not
hamper the bank in "possible transactions in telecoms and banking in Slovenia if the
state assesses that we can contribute added value."
"It all depends on the transactions - we want to find good opportunities and help
companies develop," he concluded.
NKBM Supervisors Elect new Chief Supervisor
The supervisory board of Slovenia's second largest bank, NKBM, elected Daniel Blejc
as its new chief supervisor
The supervisory board of Slovenia's second largest bank, NKBM, elected Daniel
Blejc as its new chief supervisor on Monday, 22 May.
The supervisors of the Maribor-based Nova kreditna banka Maribor (NKBM)
appointed Blejc after the previous chief supervisor Andrej Svetina tendered his
resignation, as the board resumed the session that began on Friday, 26 May.
"I have decided to step down because of the increased amount of work at the
supervisory board and at my current job. I am confident that my decision is a
responsible one and favourable for the bank and its owners," Svetina said.
"I believe that the new head of the supervisory board will carry out his duties in a
responsible manner," added Svetina, who remains on the supervisory board.
Blejc, also the director of the IT Modan informatika company, said upon his
appointment that the "owners want to see the bank become the leading banking and
insurance group in Slovenia and to extend its operations to the whole of the region."
He was previously acting as the deputy chief supervisor.
The supervisors also allocated for reserves SIT 3.76bn (EUR 15.69m) out of the total
SIT 4.95bn (EUR 20.65m) of net profits and kept the remaining funds undistributed.
NKBM is in outright state ownership, with 90% held directly by the state and the rest
in the hands of the state-run Restitution Fund (SOD) and Pension Fund Management
(KAD).
Subsidiary of Kaertner Sparkasse to Become Independent Bank
The bank Sparkasse banka, Slovenian subsidiary of Austrian bank Kaertner
Sparkasse, is to become an independent company as of October
The bank Sparkasse banka, Slovenian subsidiary of Austrian bank Kaertner
Sparkasse, is to become an independent company as of October, the Austrian bank
said on Friday, 26 May.
The Klagenfurt-based Kaerntner Sparkasse, which has been present in Slovenia since
1999, decided for the move as Sparkasse banka's business operations have extended
beyond those of a subsidiary.
Sparkasse's total assets amounted to EUR 710m at the end of 2005, while the bank
had over 200 employees and 34,000 Slovenian customers.
The bank's goal is to have 50,000 customers by 2007, and to be among the top five
Slovenian banks in terms of market share.
Bank of Slovenia council granted Sparkasse a licence for banking and other financial
services three weeks ago.
Ljubljana Stock Exchange
The main market SBI 20 index closed 62.38 points (1.2%) lower on the week at
4,944.08
The Ljubljana Stock Exchange (LJSE) is normally unfazed by global stock market
trends, but last week it reacted to the global volatility in the absence of domestic
news. Some shares recovered on Friday, 26 May, but the main market SBI 20 index
still closed 62.38 points (1.2%) lower on the week at 4,944.08.
According to Marko Garbajs of the brokerage Ilirika, the market moved in sync with
global markets, whereby just the last trading day made the overall picture of the week
a bit less bleak.
Oil company Petrol was a notable exception to the overall bearishness following
government efforts to get Russian oil and gas giants to invest in Slovenia. With deals
worth SIT 3.1bn (EUR 13m), most of it in block deals, Petrol added 1.9% to SIT
83,478 (EUR 284.34).
Pharma company Krka was also busy, generating deals worth SIT 2.7bn (EUR
11.3m), but it closed deeply in the red, having shed 4.3% on the week to SIT 143,001
(EUR 596.73). In mid-week is plunged as deep as SIT 139,000 (EUR 580).
The normally quiet spa operator Terme Catez was a surprising mover last week after
announcing double-digit growth in sales and profits. With deals worth SIT 2.5bn
(EUR 10.4m), the share remained almost level at SIT 32,785 (EUR 136.80).
Most other shares lost ground on little interest from investors. The total volume of
deals was SIT 12.3bn (EUR 51.3m), with nearly three quarters made in block deals.
On significant gains by the big names, offset only partially by Petrol, the blue chip
SBI TOP index was down 1.9% (21.48 points) to 1,123.35.
The investment fund PIX index fared a bit better, dropping only 16.35 points to
4,007.49. The bond BIO index lost 0.21 points to 118.87.
Foreign Exchange
Mean exchange rate of the Bank of Slovenia
Euro (EUR) - SIT 239.60 (+0.00)
U.S. dollar (USD) - SIT 187.05 (-0.69)
Swiss franc (CHF) - SIT 153.72 (-0.25)
British pound (GBP) - SIT 350.05 (-2.05)
REGIONAL INFORMATION
PM Promises Improvements to Infrastructure in Notranjsko
Prime Minister Janez Jansa has pledged that road, telecommunications and
electricity infrastructure in the southwestern Notranjsko region would be upgraded in
the future to allow better business potential
Prime Minister Janez Jansa has pledged that road, telecommunications and electricity
infrastructure in the southwestern Notranjsko region would be upgraded in the future
to allow better business potential.
Jansa made his comments during Tuesday, 23 May's visit to maker of plastic and steel
products Kovinosplastika in Loz ahead of the cabinet visit to the Notranjsko region.
The prime minister and Economics Minister Andrej Vizjak met with the management
of the company to discuss its development and obstacles it is facing in attempts to
grow.
According to Jansa, road, telecommunications and energy infrastructure is the biggest
hurdle to growth of the company and the region as a whole.
In a bid to tackle this, the government has prepared a programme to deal with the
infrastructure shortcomings in the coming years, he added without specifying
deadlines.
According to him, the energy infrastructure will be the first to be upgraded, followed
by telecommunications. Road infrastructure is to be last, although it will happen in the
foreseeable future, he said.
Meanwhile, Jansa announced that the state would withdraw from Kovinoplastika - it
holds 30% through the state-run KAD and SOD funds - in the coming months as part
of its privatisation plans.
Kovinoplastika chairman Alojz Mazij praised the government's efforts to upgrade
infrastructure in the region. He stressed that his company merely wanted to have the
same opportunities and conditions as other Slovenian companies.
Kovinoplastika Loz is by far the biggest company in the region, employing 1,165
workers and generating sales of SIT 19.4bn (EUR 81m) last year. The company
operates branch offices in Poland, the Czech Republic, Romania, Germany, Croatia,
Bosnia-Herzegovina, Austria and Serbia-Montenegro.
PM Says Tourism and Logistics Key for Development of Notranjska
Well-developed infrastructure in a part of the region would facilitate the development
of logistics and industry, while more extensive investments should also be made in
tourism, PM Janez Jasna said during the cabinet's visit to the Notranjsko (SW) region
Well-developed infrastructure in a part of the region would facilitate the development
of logistics and industry, while more extensive investments should also be made in
tourism, PM Janez Jasna said during the cabinet's visit to the Notranjsko (SW) region.
"We have come to the region to get acquainted with the actual difficulties and to
define, together with local companies, the development sectors that would be worthy
of investments in the future," the PM added.
He added that a number of issues at the meetings dealt with transport infrastructure,
mainly regarding a motorway between the regional hub of Postojna, railway transport
hub of Divaca and the Jelsane border crossing with Croatia.
"This project is included in the national programme and can be carried out within the
future EU budget perspectives. Concrete measures have already been taken this year,"
he revealed.
The second most important regional transport project is upgrading the state road
between Unec, Loska valley and the Croatian border. "This is an important project as
it presents the only road for the inhabitants of this part of the region," he stressed.
Environment and Spatial Planning Minister Janez Podobnik meanwhile said that
Notranjsko should in the future become an eco-region, with a letter of intent to that
effect having been signed between the minister and mayors on Tuesday, 23 May.
Jansa and Minister of the Economy Andrej Vizjak also visited electric motors
producer Ydria Motors, with Vizjak stressing that the company is proof that foreign
capital can create successful business operation in the country.
Ydria Motors, wholly owned by Germany's motors and fans producer ebmpapst
Landshut, generated EUR 35m in revenues last year, with the share of its exports,
mainly to Germany, reaching 95%. The Cerknica-based company employs 466
workers.
Finance Minister Andrej Bajuk meanwhile visited plastics and steels producer Liv
Postojna, saying that he is very proud that such a competitive company exists in
Slovenia.
Liv Postojna, recently acquired by Idrija-based commutator producer Kolektor Group,
employs 434 workers and aims for a profit of SIT 401m (EUR 1.67) in 2006.
Bajuk also made a stopover at the Javor Pivka timber company, saying that its
restructuring has enabled the company to find a new market niche that will allow it to
sell its products throughout the world.
He also commented on the recently-launched European Commission investigation
into state aid to the Pivka-based company. "Once the Commission is acquainted with
facts I am sure that there will be no problems," Bajuk explained.
Pomurje Still Lagging Behind the Rest of Slovenia
The economic situation in Slovenia's poorest region of Pomurje improved in 2005
compared with the country's average, but the development gap to the rest of Slovenia
is still large, according to the Agency for Public Legal Records and Related Services
The economic situation in Slovenia's poorest region of Pomurje improved in 2005
compared with the country's average, but the development gap to the rest of Slovenia
is still large, according to the Agency for Public Legal Records and Related Services
(AJPES).
Sole proprietors were the most successful in the region, generating a net profit of SIT
3.8bn (EUR 15.86m), while the companies posted SIT 335m (EUR 1.4m) of net loss,
AJPES's Simona Bukovec said as she presented the data in Murska Sobota on Friday,
26 May.
The AJPES report includes data for 1,149 companies, which employed 18,394 people
last year, and 2,869 sole proprietors in the statistic region of the northernmost region
of Pomurje.
A comparison with the country's average shows that in Pomurje revenues per
employee are around 39% below average, gross wages 20% and net added value
almost 35% below average.
Mateja Hauser-Podlunsek, the director of the Pomurje branch of the Chamber of
Commerce and Industry of Slovenia (CCIS), meanwhile told the press that the
development gap will not decrease by itself.
"The state's measures do not have the same effect in Pomurje as in the rest of Slovenia
because of the region's underdevelopment. Pomurje therefore needs special
programmes to reach the country' average," she added.
BRANCH INFORMATION
Power Producers Fear Lack of Emission Coupons
"The European Commission has not decided yet on how much greenhouse gas
emission coupons will be handed out to Slovenian energy companies in 2008-2012
period, however, even in the best case scenario there will not be enough of them,"
Andrej Sustersic of the Milan Vidmar Electric Power Research Institute has said
"The European Commission has not decided yet on how much greenhouse gas
emission coupons will be handed out to Slovenian energy companies in 2008-2012
period, however, even in the best case scenario there will not be enough of them,"
Andrej Sustersic of the Milan Vidmar Electric Power Research Institute has said.
Speaking at the session of the management board of the Energy Association at the
Chamber of Commerce and Industry of Slovenia (CCIS) on Wednesday, 24 May,
Sustersic said that the demand for CO2 emission coupons in Slovenia is rather high.
Thermal power plants in Sostanj, Trbovlje, Brestanica and Ljubljana have all
demanded the right to more than six million tonnes of CO2 emissions a year, while
they will presumably be granted only five million tonnes of emissions a year, he
continued.
Sustersic also pointed out that the existing energy-production facilities are mostly
focused on the use of solid fuels, therefore, a diversification of primary energy
products is needed.
Meanwhile, Zvone Kosnjek of the ELEK Svetovanje advisory firm said that gas fuels
produce lower greenhouse gas emissions than solid fuels, however, only 0.4% of gas
fuels are used as primary sources for electricity production in Slovenia.
The goals are to increase the share of gas fuels to 17% by 2012, while the share of
solid fuels should fall from the current 31.5% to 25.2%, he added.
According to Sustersic, most of the power plants in Slovenia are old, and should be
modernised in order to ensure reliable and quality power production, increase the use
of renewable sources, reduce emissions and ensure competitiveness of energy
production.
As Kosnjek explained, CO2 emissions could thus after 2012 be lowered from the
current 1.2 kilograms per kilowatt hour to 0.8 kilograms, which is close to the EU's
average.
The Energy Association was moreover briefed to on the situation on the energy
market, presented by Velimir Bole of the Economic Institute at the Faculty of Law,
who said that the liberalisation of Slovenia's energy market has led to an increase in
cross-border trading.
Barbara Guncar Steps Down as Head of Tourist Board
Barbara Guncar, the general manager of the Slovenian Tourist Board (STO), stepped
down at the meeting of the STO's management board
Barbara Guncar, the general manager of the Slovenian Tourist Board (STO), stepped
down at the meeting of the STO's management board on Friday, 26 May. Her
resignation was accepted by the management, following a proposal by the Economics
Minister Andrej Vizjak.
After the meeting, Guncar said in a press release that she has decided to resign for
personal reasons, adding that she wants to start working in a company.
The board members moreover appointed Dimitrij Piciga of travel agency Kompas as
STO's acting manager at Vizjak's behest.
Guncar's resignation as well as Piciga's appointment has to be confirmed by the
government, with Guncar set to perform her duties until then.
The management board's agenda included a proposal by the supervisory board on
dismissing Guncar, however, she beat them to the punch.
The meeting also discussed the results of an extraordinary internal audit on fund use
in 2005, decreed by Vizjak, which uncovered certain irregularities in the use of SIT
62m (EUR 259,000).
Chairman of the management board Marjan Hribar told the press that the ministry was
planning to replace Guncar even before the session.
While admitting that the STO has made some progress under Guncar, Hribar said that
he is not overly satisfied with its sales promotion.
COMPANIES
Telco Boss Believes Strategic Partner Not Necessary Yet
A partner that would bring new know-how into the national telco Telekom Slovenije is
not needed at this point, while the current capital suffices for the company's
expansion plans, Bojan Dremelj, Telekom Slovenije CEO, told the daily Dnevnik
A partner that would bring new know-how into the national telco Telekom Slovenije
is not needed at this point, while the current capital suffices for the company's
expansion plans, Bojan Dremelj, Telekom Slovenije CEO, told the daily Dnevnik on
Monday, 22 May.
"We are very pleased that the process of selling the state's stake in Telekom is
continuing," Dremelj said, adding that it was of utmost importance that the telco got
gets listed on a stock exchange.
However, all the remaining steps determined in the recently adopted government plan
to privatise the telco, are a bit further down the line, Dremelj told Dnevnik.
"A strategic partner is a somewhat modern expression and does not necessarily mean
what the people think it does," he explained.
While he admitted to an existing interest of foreign companies in acquiring Telekom,
he did not want to speculate about the value. "The owner has stated quite clearly in
the past how much Telekom Slovenije is worth," he said.
He moreover told Dnevnik that as the future of telecommunications lies in the
convergence of fixed-line, mobile telephony and IP telephony, Telekom is
considering reintegrating its Internet service provider arm Siol into the group.
The expansion will definitely be carried out by Telekom as a group. "Our preferences
are SE European markets," he said, adding that while the company will not invest in
Malta, Macedonia remains a clear objective.
Intereuropa Beats Targets in Q1
Logistics company Intereuropa saw a 13.3% rise in net sales revenues in the first
quarter of 2006 compared to the same period last year
Logistics company Intereuropa saw a 13.3% rise in net sales revenues in the first
quarter of 2006 compared to the same period last year. The SIT 12.5bn (EUR 52.2m)
in revenues mean the group beat its targets by 6.8%, Intereuropa said on Monday, 22
May.
The company also upped its net profit to SIT 447.96m (EUR 1.87m), which is 20%
over the expected sum.
Intereuropa's supervisors attributed the good results to the sales activities conducted in
the first months of 2006.
Apparel Manufacturer Mura Ends 2005 with Loss of EUR 1.41m
Textile group Mura generated SIT 18.2bn (EUR 75.95m) in revenues in 2005
Textile group Mura generated SIT 18.2bn (EUR 75.95m) in revenues in 2005, while
posting a loss of SIT 339m (EUR 1.41m), greatly improving on its 2004 loss of SIT
929m (EUR 3.87m), the company said in Murska Sobota on Monday, 22 May.
The group's results were reviewed by Mura's supervisors, who also decided to call an
AGM, which would put on vote to discharge the management and the supervisory
boards.
Operational losses of the group's core company, apparel manufacturer Mura,
meanwhile amounted to SIT 685m (EUR 2.85m), SIT 354m (EUR 1.47m) less than in
2004, with revenues reaching SIT 13.6bn (EUR 56.76m).
The supervisors also assessed that continuing with its 2005-adopted development
strategy will be of key importance for the company's survival.
DARS Borrows EUR 75m
The loan, taken out for 18 years and secured by a state guarantee, will be used for the
construction of several sections of the national motorway programme
Slovenia's Motorway Company (DARS) signed a deal on Monday, 22 May with the
Depfa ACS Bank and the Depfa Bank from Dublin for a loan of EUR 75m.
The loan, taken out for 18 years and secured by a state guarantee, will be used for the
construction of several sections of the national motorway programme.
It will be used to fund the motorway sections Lendava - Pince, Pesnica - Slivnica:
Nova Zrkovska cesta (NE), the link to the port of Koper (SW) and Lesnica - Kronovo
(SE), DARS said on Tuesday, 23 May.
Port of Koper Signs Deal with Korean Logistics Company
Luka Koper, the operator of Slovenia's only commercial port, has signed a deal with
the Korean company Glovis for the use of the port as a logistical base for the new car
factories which Kia and Hyundai are building in Slovakia and the Czech Republic
Luka Koper, the operator of Slovenia's only commercial port, has signed a deal with
the Korean company Glovis for the use of the port as a logistical base for the new car
factories which Kia and Hyundai are building in Slovakia and the Czech Republic,
Luka said Tuesday, 23 May.
Luka Koper CEO Robert Casar and board member Aldo Babic last week concluded
talks in Seoul with representatives of Glovis, the largest logistics company in South
Korea. Glovis Europe Corporation plans to built a subsidiary in Koper.
The deal also foresees an increase in the annual flow of vehicles and containers. "The
deal has been struck despite fierce international competition and has been helped by
the good relations between the transport minister and his foreign counterparts," the
port said.
On 23 May 1957, the company Luka Koper was established. Works on the
construction of Slovenia's first commercial port started the same month, with its first
terminal being completed in November.
Mercator Doubles Q1 Net Profit
Retailer Mercator managed to more than double net profit in the first quarter of this
year to SIT 1.9bn (EUR 7.9m)
Retailer Mercator managed to more than double net profit in the first quarter of this
year to SIT 1.9bn (EUR 7.9m). But discounting the one-off proceeds from the sale of
a hotel, underlying profit increased by 22% to SIT 1.4bn (EUR 5.8m), the company
said on Wednesday, 24 May.
The profits come on sales of SIT 104.5bn (EUR 436m), an increase of 14% over the
year before, according to Mercator's management board.
The retailer profited from the laxer regulations on Sunday shopping following a stay
by the Constitutional Court of several provisions of the trade act.
However, the fact that only stores selling food may open on Sundays has also had an
adverse impact, as other stores in shopping centres remain closed on Sundays, the
press release reads.
Moreover, the company says that the mandatory dual pricing in tolars and euros has
raised operating costs, as has the integration of the recently-acquired Era stores in
Slovenia and Croatia.
Retailer Tus Entering Mobile Telecommunications Market
Slovenia's third-largest retailer, Tus, is entering the mobile phone market by buying
out the license held by soon-to-be-defunct mobile operator Vega
Slovenia's third-largest retailer, Tus, is entering the mobile phone market by buying
out the license held by soon-to-be-defunct mobile operator Vega.
Tus mobil, the mobile telephony subsidiary of Tus, announced on Wednesday, 24
May that it had been entered into the register of national mobile phone operators and
that it had gained operating clearance from the Agency for Post and Electronic
Communications.
The company intends to act as a mobile services provider, using the network of
Slovenia's leading mobile company, Mobitel.
According to general manager of Tus mobil Marko Fujs, the company bought the
license held by Vega, the subsidiary of Western Wireless International, which
recently decided to end operations in Slovenia because of poor results.
The purchase of Vega's license means that Tus mobil will be able to launch operations
immediately. The company intends to unveil its offer soon, Fujs said. He refused to
say how much his company paid for the license.
According to a press release from Tus, the company has for some time been preparing
to make a breakthrough on the telecommunications market.
As part of the strategy, the company has already provided fresh capital to Iskraemeco
Kranj, which will become the communication and development hub of Tus, the press
release adds.
Vega had in mid-April sold its network to the two leading mobile operators in the
country, Mobitel and Simobil. The move marked the end of WWI's rocky five-year
adventure in Slovenia.
Defence Contractor to Build New Factory in Autumn
Defence technology company Sistemska tehnika intends to start building in autumn its
new production facility for the assembly of the Krpan 8x8 and Valuk 6x6 light
armoured personnel carriers
Defence technology company Sistemska tehnika intends to start building in autumn
its new production facility for the assembly of the Krpan 8x8 and Valuk 6x6 light
armoured personnel carriers, the Viator&Vektor transport and logistics group has
said.
Slovenia's largest defence technology specialist intends to complete the construction
of the 8,000 square metre facility in the first half of 2007, boosting development
opportunities and opening over 100 new jobs in the region of Korosko (NE).
The Ravne na Koroskem-based company is also awaiting the decision by the Ministry
of Defence on the acquisition of 8x8 armoured vehicles. The ministry told STA that it
received two bids, the second from bearings producer Rotis Trzin, both in line with
the tender's specifications. The final decision is expected by the end of the year.
Sistemska Tehnika currently employs 320 workers, with two-thirds working on its
defence programme. It is currently involved in talks on producing nearly 900
armoured personnel carriers, added Viator&Vektor, the parent of Sistemska tehnika,
in a press release.
Gorenje CEO Reveals Ambitious Expansion Plans
The chief executive of household appliance maker Gorenje has said that the company
has ambitious expansion plans, whereby production will only be expanded abroad
and remain level at home
The chief executive of household appliance maker Gorenje has said that the company
has ambitious expansion plans, whereby production will only be expanded abroad and
remain level at home.
"In Slovenia we want to retain the current output and the number of productive jobs,
while additional volume growth will be achieved elsewhere," Franjo Bobinac said in
an interview for the weekly Demokracija.
According to him, 10% of the production is already taking place in the Czech
Republic (after last year's acquisition there of Mora Moravia). In the coming years
production will be expanded to four locations, including Russia and Ukraine.
Gorenje will grow through a combination of acquisitions and greenfield investment
with a view to raising sales to between 1.5 and 2 billion euros a year. "If we double
our market share, we will capture around 7% or 8% of the European market."
This would make Gorenje the fifth largest player in the industry in Europe, which
accounts for 90% of the company's sales.
Other priorities for the company include achieving economies of scale and effective
cost management, as well as brand innovation. "We will try to instill our design with a
greater sense of technological innovation," he said.
In terms of international presence, Gorenje is already the biggest Slovenian
multinational, but it plans to become at least twice as big, with a strong market
position and based in Slovenia, he said.
Aerodrom Posts Double-Digit Growth in Sales, Profit
Aerodrom Ljubljana, the operator of the Ljubljana Airport, posted double-digit
growth in profits and sales for the first quarter of the year
Aerodrom Ljubljana, the operator of the Ljubljana Airport, posted double-digit
growth in profits and sales for the first quarter of the year. Net profit soared 54% to
SIT 257m (EUR 1.1m) on operating revenues which increased 12% to SIT 1.4bn
(EUR 5.8m).
The number of passengers was up 11% to 236,500, with cargo volumes increasing by
19% to 3,000 tonnes, the company said in a press release on Thursday, 25 May.
Slovenian carrier Adria Airways still accounts for 74% of all passengers, yet the
numbers carried by foreign carriers have been on the rise, increasing by 3% year-onyear in the first quarter.
The number of flights increased by 36% to 1,700 in the given period.
Terme Catez Increases Q1 Net Profit by 23%
Slovenia's leading spa operator Terme Catez posted a net profit of SIT 121m (EUR
505,000) for the first three months of 2006, an increase of 23% over the year before
Slovenia's leading spa operator Terme Catez posted a net profit of SIT 121m (EUR
505,000) for the first three months of 2006, an increase of 23% over the year before,
the company said on Thursday, 25 May.
In the same period, the company generated SIT 1.5bn (EUR 6.26m) in sales revenues,
up 18% over the year before, the press release also reads.
Spas owned by Terme Catez saw 111,470 overnight stays in the first quarter, which is
a 2.3% rise year-on-year. While the number of overnight stays by domestic guests
was up 1.3%, foreigners generated around 4% more overnight stays than last year.
The group plans to conclude an investment in Mokrice Castle in the southeast, 40% of
which is co-financed by the European Structural Funds, and another one in the coastal
resort of Portoroz.
Moreover, the second phase of a tourist complex in Terme Ilidza in BosniaHerzegovina's Sarajevo is underway, which also includes a conference and a wellness
centre.
Bread and Pasta Maker Ends Q1 with EUR 1.3m Profit
Bread and pasta maker Zito was successful in Q1 of 2005, posting a profit of SIT
307m (EUR 1.3m)
Bread and pasta maker Zito was successful in Q1 of 2005, posting a profit of SIT
307m (EUR 1.3m), improving on its result in the same period last year by SIT 211m
(EUR 880,600), the company said on Thursday, 25 May.
The group moreover generated SIT 6.55bn (EUR 27.33) in net sales revenues in the
same period, up 3% year-on-year. The upbeat results were also caused by the sales of
the company's assets and shares.
Despite the results, which are in line with plans, the company did not manage to reach
its sales targets, mainly due to lower sales in January caused by a decision of the
Slovenian parliament to close Slovenia's shops on Sundays.
WAZ and DZS Sign Deal on Joint Venture
Slovenian publishing house DZS and German media conglomerate WAZ signed
Thursday, 25 May a deal on the establishment of a 50:50 joint venture which will
take charge of DZS's 51.05% stake in the daily Dnevnik
Slovenian publishing house DZS and German media conglomerate WAZ signed
Thursday, 25 May a deal on the establishment of a 50:50 joint venture which will
take charge of DZS's 51.05% stake in the daily Dnevnik, DZS said on Thursday, 25
May.
As DZS's chairman Bojan Petan said in a press release, the company intends to inform
the public regularly on further activities of both publishers.
The two companies had already signed a letter of intent on the joint management of
media investments on the Slovenian market a while ago.
The newly established company will have a two-member management board. The
chairman will be from the ranks of the DZS while WAZ will get a board member.
Speculations about the arrival of WAZ started at the beginning of this year, with
Dnevnik as well as the two other nation-wide dailies, Delo and Vecer, named as
possible targets.
WAZ, based in Essen, is one of the biggest newspaper publishers in Europe, with a
total of 38 newspapers in its portfolio. In addition to Germany, it has papers in
Croatia, Hungary, Bulgaria, Romania, Serbia-Montenegro and Macedonia.
Its foothold in Croatia is especially big: Europapress Holding, which is in 50%
ownership of WAZ, publishes 18 titles, including the general-interest Jutarnji list and
business daily Poslovni Dnevnik.
The new joint venture will have to obtain approval from the Culture Ministry for the
acquisition of the stake; by law any transaction involving over 20% of a media outlet
requires Culture Ministry approval.
DZS owns 51% of Dnevnik. Other major owners include Austrian publisher Styria
(26%), the state-owner Pension Fund Management (10%) and newspaper publisher
Vecer (6.5%).
The daily Dnevnik has an average circulation of about 60,000, according to
information available on its web page. The publisher also publishes the tabloid
Nedeljski Dnevnik, one of the most widely read weekly papers in Slovenia.
Hardware Retailer Merkur Increases Revenues by 25% in Q1
Hardware retailer Merkur increased its sales by 25% in the first quarter of 2006
compared to the same period last year to SIT 45.7bn (EUR 190.73m)
Hardware retailer Merkur increased its sales by 25% in the first quarter of 2006
compared to the same period last year to SIT 45.7bn (EUR 190.73m), Merkur said on
Thursday, 25 May.
The company moreover posted a net profit of SIT 331m (EUR 1.38m) in the same
period, 24% more than in the January-March period of 2005, the supervisory board of
Merkur was told at the session.
At their session Merkur supervisors also decided on the distribution of SIT 10.6bn
(EUR 44.23m) of accumulated profit in 2005.
The supervisors decided to propose that the AGM, expected on 3 July, allocate SIT
984m (EUR 4.1m) for dividends, meaning the gross payment of SIT 750 (EUR 3.13)
per share.
Bostanj Hydro Plant Enters One-Year Test Phase
Once it operates at full power, the first of the five planned hydro stations on the lower
Sava will account for about one percent of the domestic electricity production
The Bostanj hydroelectric power plant on the river Sava was officially launched on
Saturday, 27 May, three and a half years after the start of preparation works. Once it
operates at full power, the first of the five planned hydro stations on the lower Sava
will account for about one percent of the domestic electricity production.
The trial run will last about a year, during which time all operating modes will be
tested and possible flaws tackled before the start of commercial operation. The power
plant will have an output of 116 GWh per year when it is fully operational.
The hydro plant was inaugurated by Economics Minister Andrej Vizjak, who said that
the government will strive to push back the deadline for the construction of the four
remaining plants on the Sava (Blanca, Krsko, Brezica and Mokrice), which is now set
at 2018.
The five hydro plants are currently the biggest energy project in the country, with an
estimated price tag of over 400 million euros. Bostanj alone cost 90 million euros.
Yet although the power plants are expected to produce more power than the hydro
chain on the Drava, Joze Zagozen, the general manager of power producer HSE,
which is building the plants, said that the added output will not be enough to meet
Slovenia's growing need for electricity.
Activities are already underway for the construction of the Blanca power plant
downstream. Construction works are expected to begin early next year, according to
Bogdan Barbic, who is in charge of the project at HSE.
Although by far the biggest, the lower Sava power plants are not the only HSE project
currently underway. The company is already constructing the Avce pumped-storage
hydro plant in the west of Slovenia.
HSE is also conducting a feasibility study for the construction of several hydro plants
on the Mura in the northeast and on the Sava, upstream from Bostanj.
SLOVENIA IN BRIEF
Slovenia to Follow EU Lead in Recognising Montenegro
Slovenia will "probably soon" recognise Montenegro as an independent state, but it
will act in accordance with the EU, Foreign minister Dimitrij Rupel said on Monday,
22 May, after preliminary official results of the Montenegro independence
referendum showed that a sufficient majority voted for seceding from Serbia.
Slovenia Starts Talks on Full Membership in EUMETSAT
Slovenia officially started on Tuesday, 23 May negotiations for becoming a full
member of the European Organisation for the Exploitation of Meteorological
Satellites, EUMETSAT.
New European Future Centre Opens in Slovenia
"Support for the countries from SE Europe will be one of Slovenia's priorities during
its EU presidency at the beginning of 2008, and also one of the main tasks of the new
Centre for a European Future," PM Janez Jansa and FM Dimitrij Rupel agreed on
Tuesday, 23 May as they inaugurated the new centre.
Slovenia Presents Itself at a Theme Park in Germany
Slovenia is being staged a Slovenian village at the Europa-park theme park in Rust
near Freiburg, Germany, between 28 May and 6 June, Slovenian MEP Lojze Peterle
told a press conference in Celje on Thursday, 25 May
Media Law Passed
The National Assembly has passed the disputed changes to the media act in a 38-to-23
vote at a session on Friday, 26 May. The government claims that the law will promote
media pluralism, however, the opposition remained sceptical
Slovenia Offers Aid to Quake-Struck Indonesia
Slovenia has offered humanitarian aid to Indonesia, which was struck by a 6.2magnitude earthquake on Saturday, 27 May that left thousands dead, the Foreign
Ministry said in a press release.