Slovenia Business Week no. 19, May 21, 2007
HEADLINES
State Wants to Induce Young to Help Economy Through Innovation
The state is intent on encouraging young people to make innovations because that is what it
pays most
The state is intent on encouraging young people to make innovations because that is what it
pays most, an official said on Tuesday, 15 May at an event aimed at promoting innovation.
<BR><BR>
The conference, sponsored by the Slovenian Technology Agency in cooperation with the
ministries of education, defence and economy, established that the economy was bound to
lose its competitive edge without innovation. All participants were keen to hear the
government's plans in this respect. <BR><BR>
Minister of Higher Education, Science and Technology Jure Zupan said the ministry had
made it its goal to add 70 junior researches in industry to the national research programme
every year until 2010. According to him, these are researchers who are employed in
companies, while the ministry funds them for four years and a half. <BR><BR>
The minister was nevertheless surprised over the low number of applications for this scheme.
A total of about 100 companies apply for junior researchers a year. According to Janez Hafner
of the Technology Agency, some EUR 81m will be earmarked for junior researchers until
2013. <BR><BR>
This year the bulk of funds will be spent on the Defence Ministry's call for project
applications. The call, a part of the "Technology for Peace" project, has already been
published, while another is to follow at the end of the year, each worth around EUR 9.5m,
according to Hafner. <BR><BR>
Until 2013 an additional EUR 24m will be allocated for research and development projects.
The Technology Agency also invests in technological platforms along with the Economy
Ministry and the Chamber of Commerce, while its contribution is lesser at EUR 146,000.
<BR><BR>
Yet apart from funding research, the state could play a more important role in intervening
between innovators and companies, Zupan suggested, saying the main problem was how to
market innovations. "Innovation itself represents but a tenth of the product's value."
<BR><BR>
An important generator of technological development is the Defence Ministry, according to
Minister Karl Erjavec. He said that his department's contribution to R&D was the highest
among its counterparts in Europe, as much as 6% of the budget. <BR><BR>
According to Erjavec, the potential of the defence system in this respect has been neglected,
but the ministry will be steadily increasing its budget and in this way also funds for R&D.
These amounted to some EUR 25m last year. "We would like these funds to be spent
appropriately."
Conference Looks for Opportunities of Climate Change
The Chamber of Commerce and Industry of Slovenia (CCIS) sees climate change as an
opportunity for Slovenian companies which develop new technologies, which is why it staged
a conference in Ljubljana to push for changes that would encourage the corporate sector to
go green
The Chamber of Commerce and Industry of Slovenia (CCIS) sees climate change as an
opportunity for Slovenian companies which develop new technologies, which is why it staged
a conference in Ljubljana on Wednesday, 16 May to push for changes that would encourage
the corporate sector to go green. <BR><BR>
Environmental protection is not just a cost, but it is necessary to change habits and influence
decision-makers to give technological changes adequate incentives, CCIS interim president
Samo Hribar Milic told the conference dubbed "Let's Cool Slovenia". <BR><BR>
Hribar Milic hopes the conference, which brings together business executives and experts,
will give the CCIS arguments to achieve changes that would be bearable for the economy.
"This is not to say that we are shying away from responsibility for the environment, while the
interests and experience of Slovenian companies must be taken into account." <BR><BR>
Representing decision-makers, Environment and Spatial Planning Minister Janez Podobnik
highlighted energy efficiency as one of the major factors in cutting greenhouse gases,
reducing dependence on the imports and increasing the share of renewable sources of energy.
<BR><BR>
"Estimates by the European Commission show that the economic potential for energy saving
is around 20% in industry, and twice as much in buildings," Podobnik said and added that the
potential would be even bigger given higher energy prices and better technologies.
<BR><BR>
Slovenia's economy expanded by about 5% last year, while energy consumption increased by
3%. "This is a right direction, but the question is whether it is right enough," Podobnik
wondered. Until 2013, Slovenia will earmark about EUR 190m for sustainable energy, EUR
160m in EU funds. <BR><BR>
Alleviating the consequences of climate change is not enough, said Lucka Kajfez Bogataj of
the Ljubljana Biotechnical Faculty. She believes it is necessary to adapt to the consequences
and deal with our vulnerability to them. <BR><BR>
"The corporate sector will feel three types of pressure as a result of climate change: changed
weather conditions, demand for reduction in emissions, while it will also be expected to adapt
to new conditions," the climate expert said, sharing Podobnik's view that energy saving was
the only smart choice.
Slovenian Companies Increase Profit in 2006
Slovenian companies recorded profits for the 5th consecutive year
Slovenian companies recorded profits for the 5th consecutive year, with the total income
beating total losses by EUR 2.57bn in 2006, 41% more than in 2005, the Slovenian Public
Legal Records and Related Services Agency (AJPES) said on Wednesday, 16 May.
<BR><BR>
The report by AJPES includes records of 45,330 companies which reported their financial
data, it however does not include banks, insurance companies and some investment firms as
well as data on companies in bankruptcy or liquidation proceedings. <BR><BR>
The included companies employed 478,839 workers in 2006, 4% more than in 2005, while
their total revenues rose by 14% to EUR 66.86bn. <BR><BR>
A total of 30,294 companies (66.8%) ended 2006 with a total net profit of EUR 3.14bn, with
959 posting a profit of more than EUR 417,000. <BR><BR>
Net losses of EUR 565m were meanwhile reported by 12,890 companies (28.4%) with 230 of
them closing the year more than EUR 417,000 in the red. <BR><BR>
The EUR 3.14bn of net profit was 26% higher in 2006 over 2005, while net losses were 15%
lower. The profit has been increasing in the five-year period, the report says. <BR><BR>
According to AJPES, 92.8% of the companies belong to micro companies, 3.9% are small
companies and 1.6% medium-sized ones. The share of large companies, employing over half
of the workers, stands at 1.7%. <BR><BR>
2
Slovenian industry was the most successful in manufacturing, both regarding the number of
employees as well as revenues. Manufacturing is followed by retail, vehicle maintenance and
production of consumer goods. <BR><BR>
The average gross salary in the Slovenian companies that submitted the data stood at EUR
1,119. <BR><BR>
AJPES also analysed annual reports by 59,692 sole proprietors which employed 58,920
people with a total EUR 4.99bn of revenues. A total of 14.3% of sole proprietors ended 2006
with a loss. <BR><BR>
They include 99.97% of small sole proprietors that paid out an average gross wage of EUR
674, the AJPES report reads.
3
INTERNATIONAL COOPERATION
Slovenia and Egypt to Boost Transport Ties
Transport Minister Janez Bozic met his Egyptian counterpart Mohamed Mansour for talks on
cooperation between the countries
Transport Minister Janez Bozic met his Egyptian counterpart Mohamed Mansour on 13 May
for talks on cooperation between the countries. Talks in Cairo focused on boosting transport
ties between the Egyptian port of Alexandria and the Slovenian port of Koper, Bozic told
STA on Monday, 14 May. <BR><BR>
According to Bozic, greater demand for the shipment of perishable goods, such as fruit and
vegetables, would allow the travel time to be cut from the current five to three days, and
would enable quick distribution of such goods to EU markets. <BR><BR>
The port of Alexandria is planning to build a refrigeration chamber and a terminal with Luka
Koper already expressing its intent to take part in the investment. Talks between the
Slovenian and Egyptian partners are in progress, while Bozic used the opportunity to acquaint
his Egyptian counterpart of the company's plans. <BR><BR>
"I explained the reasons for this project and the benefits for both countries," Bozic said.
"Cooperation will improve the position of Egyptian exporters on the European market...The
introduction of new shipping routes will enable further development of both seaports."
<BR><BR>
Port operator Luka Koper expects talks between the ministers to result in realisation of plans
they started preparing a while ago, Bozic said. The minister expects the plan will get support
in Egypt. <BR><BR>
Mansour meanwhile said Egypt wanted to modernise its motorway and railway network.
Bozic said Slovenia could help Egypt by providing know-how. <BR><BR>
The Egyptian minister is to visit Slovenia in September. If any tangible agreements will be
reached by then, cooperation on concrete projects could begin, Bozic said. <BR><BR>
A general cargo route was started between Koper and Alexandria in the 1990s, while Luka
Koper would like to increase the transport of fruits and vegetables.
Slovenia, Italy Sign Key Accord on Cooperation
Slovenian Foreign Minister Dimitrij Rupel and his Italian counterpart Massimo D'Alema
signed on Monday, 14 May a memorandum of understanding on cooperation in numerous
fields, in particular energy, the environment and transport
Slovenian Foreign Minister Dimitrij Rupel and his Italian counterpart Massimo D'Alema
signed on Monday, 14 May a memorandum of understanding on cooperation in numerous
fields, in particular energy, the environment and transport. This is a sign of the "high quality
of bilateral relations," Rupel said in Brussels. <BR><BR>
The first accord of its kind for Slovenia, it opens the door to "ongoing cooperation and
deliberations between the governments in key areas" and represents a "very positive signal,"
Rupel added. <BR><BR>
Rupel said energy, environment and transport were crucial fields of interest for the
neighbouring countries, in particular in the light of "cooperation in the Adriatic". <BR><BR>
D'Alema meanwhile pointed to the political dimensions of the accord, noting both countries'
efforts to promote EU enlargement to the Balkans. <BR><BR>
Slovenia as well as Italy has been prime movers behind encouragements to Serbia on its path
towards the EU, he said. <BR><BR>
4
The memorandum envisages the establishment of a coordinating committee of ministers in
charge of foreign affairs, the economy, energy, environment, transport, agriculture, higher
education and science. <BR><BR>
The ministers are to meet once a year, or more frequently if necessary. <BR><BR>
According to unofficial information, the agreement is designed to facilitate the exchange of
information and prevent "surprises" in cooperation in energy, the environment and transport.
<BR><BR>
All these issues converged in the latest high-profile point of contention between the two
countries, the construction of two liquefied natural gas terminals in Italy, close to the border
with Slovenia. <BR><BR>
Slovenia has been opposed to the LNG terminals from the outset, but media reports suggest
plans to build at least one terminal would get the go-ahead from the Italian government.
Minister Vizjak Promotes Slovenia in Poland as FDI Destination
Slovenia's FDI in Poland stood at EUR 133m last year
Economy Minister Andrej Vizjak promoted Slovenia as having great potential for incoming
foreign direct investment (FDI) as he addressed a Slovenian-Polish business conference in
Warsaw on Monday, 14 May. There is great untapped potential for bilateral cooperation in
this field, Vizjak told executives. <BR><BR>
Slovenia's main advantages are its "fantastic" geostrategic position, traditional links with the
Balkans, good price-to-quality ratio and good business ties, said Vizjak, who is accompanying
Prime Minister Janez Jansa on an official visit to Poland. <BR><BR>
Polish Deputy Economy Minister Marcin Korolec meanwhile presented Poland's trump cards,
saying the country had a young and well-educated workforce as well as low labour costs.
<BR><BR>
Slovenia's FDI in Poland stood at EUR 133m last year, which makes Poland the fifth biggest
destination for Slovenian foreign investment. Poland meanwhile had FDI of only half a
million euros in Slovenia last year. <BR><BR>
Trade between the two Slavic nations meanwhile amounted to EUR 800m in 2006, according
to data from the Economy Ministry, making the country Slovenia's 13th biggest trading
partner.
Slovenia Gets OECD Membership Invitation
The Organisation for Economic Cooperation and Development (OECD) invited o Slovenia along with four other nations - to join the organisation, fulfilling the country's decade-long
foreign policy goal
The Organisation for Economic Cooperation and Development (OECD) invited on
Wednesday, 16 May Slovenia - along with four other nations - to join the organisation,
fulfilling the country's decade-long foreign policy goal. <BR><BR>
Slovenia asked for membership in the economic think tank associating the world's top 30
economies in 1996, while approval came as ministers from the OECD met in Paris.
<BR><BR>
The formal invitation to join the elite club of the world's leading economies is to be followed
by the launch of membership talks, which could be closed by year's end or in early 2008.
<BR><BR>
Slovenia received the invitation together with Estonia, Russia, Israel and Chile. <BR><BR>
OECD Secretary General Angel Gurria voiced "great pleasure" that Slovenia was among the
five countries that have been invited to join the organisation. <BR><BR>
5
Speaking for Slovenian journalists after the close of the OECD ministerial, Gurria said that
Slovenia had good negotiating prospects and that the tempo of the talks would be dictated by
Slovenia. <BR><BR>
According to him, today's development marks the start of a process that will still require a lot
of work. The decision does not mean that "Slovenia will become a member overnight", he
pointed out. <BR><BR>
Gurria said focus should not be paid on why it took so long for Slovenia to get an invitation instead, there should be delight that this has finally happened. <BR><BR>
According to the Foreign Ministry, which has headed Slovenia's efforts to join the OECD,
Slovenia stands to have better access to key global economic data and improve its
international image by joining the OECD. <BR><BR>
One of the main benefits of membership, says the ministry, is assistance in planning national
policies and cooperation in projects that would be too costly to carry out by Slovenia alone.
<BR><BR>
Foreign Minister Dimitrij Rupel hailed the invitation, saying it was good for the country to be
in. "In the economy as elsewhere, insider information is essential. If there ever was an insider
club, it is the OECD." <BR><BR>
According to him, the costs of membership are expected to be on par with those of
Luxembourg, which has a similar GDP - about EUR 700,000 annually. Considering the
benefits, the cost is quite low, he said in Ljubljana. <BR><BR>
Slovenia first applied for membership in the elite economic club in 1996. In 1999 it appointed
an inter-departmental taskforce for membership, while top officials recently stepped up
lobbying at the highest level. <BR><BR>
The OECD membership criteria set down that a new member must be "like-minded" and a
"significant player", and it must also have "mutual benefit", while its membership must gave
"global considerations". <BR><BR>
The Foreign Ministry said that Slovenia fulfilled the criteria. The main factors weighing in
Slovenia's favour are eurozone membership, its stint as the chair of the OSCE in 2005,
membership of the UN Security Council in 1998-99 and its chairing of the IAEA Board of
Governors in 2006-07, as well as its term as EU president in the first half of 2008.
<BR><BR>
The Chamber of Commerce and Industry (CCIS) welcomed the invitation issue to Slovenia to
"join an organisation that will open the door to be at the source of information". It added that
membership of the OECD would promote the transfer of best practices in the economy.
<BR><BR>
Some of Slovenia's leading economists have already welcomed the news of the invitation,
saying OECD membership would primarily help improve Slovenia's economic data, while
also boosting the country's international image. <BR><BR>
Of the 27 EU member states, 19 are members of the OECD. The other members are Australia,
Canada, US, Japan, South Korea, Iceland, Mexico, New Zealand, Norway, Switzerland and
Turkey.
Indian Official Says Greater FDI Inflow Depends on Trade
Trade between India and Slovenia totalled only EUR 85m last year
Trade between India and Slovenia totalled only EUR 85m last year. According to Tarun Das,
chief adviser to the Confederation of Indian Industry, an increase in trade is a precondition for
more Indian foreign investment in Slovenia. <BR><BR>
"We have to work together more, only then can we expect a greater presence of Indian
companies in Slovenia," Das told Slovenian businessmen at a meeting organised by the
Chamber of Commerce and Industry of Slovenia (CCIS). <BR><BR>
6
India also wants more foreign investment. Even though it remains cautions to avoid ending up
in the hands of foreigners, the country is calling on foreign companies to take advantage of
the favourable opportunities, he said. <BR><BR>
Das added that Slovenian companies needed to start realising the great potential of the rapidly
developing India, whose economy is expanding at a rate of 8.5% a year. <BR><BR>
Indian Ambassador to Slovenia Villur Sundararajan Seshadri believes that poor knowledge of
Indian potentials is the main reason for the modest trade with Slovenia. <BR><BR>
"There is a lot to be done in this field. The Indian embassy can play an important role in that,"
said the first ever resident Indian ambassador to Slovenia, who took office three months ago.
<BR><BR>
The Confederation of Indian Industry offered assistance to Slovenian companies seeking to do
business in India. Das said that the country was an interesting destination for Slovenian
businesses, in particular due to lower taxes. <BR><BR>
He said the association would also encourage Indian companies to come to Slovenia, but
businessmen are facing a major obstacle - obtaining a visa is a long and arduous process.
<BR><BR>
Samo Hribar Milic, the head of the CCIS, said the chamber would join forces with the
Foreign Ministry to try and simplify the visa procedure. <BR><BR>
Slovenia's exports to India stood at almost EUR 32m in 2006, up 78.8% year-on-year
according to CCIS data. Imports meanwhile stood at just under EUR 53m.
Drnovsek Receives New Ukrainian Ambassador
Slovenian President Janez Drnovsek received credentials of the newly appointed Ukrainian
Ambassador to Slovenia Vadim Viktorovich Primachenko
Slovenian President Janez Drnovsek received on Thursday, 17 May credentials of the newly
appointed Ukrainian Ambassador to Slovenia Vadim Viktorovich Primachenko, the
president's office said. <BR><BR>
In talks with Primachenko, Drnovsek said the relations between Slovenia and Ukraine are
very good and developing in all areas as well as expressed his hopes for Ukraine's successful
bid for EU and NATO membership. <BR><BR>
According to Drnovsek, the European integration process will not be completed, until all the
countries with the possibility to join the EU become member states. <BR><BR>
Drnovsek wished Primachenko a lot of success with his work at the embassy that opened in
2004. Primachenko succeeded first Ukrainian ambassador to Slovenia Ivan Gnatishin.
<BR><BR>
Slovenia also has an embassy in the Ukrainian capital of Kiev with Primoz Seligo as the
country's representative.
EU-Latin America Summit Tops Rupel, Ugarte Meeting
The pair, meeting at the sidelines of the 9th ministerial of the Human Security Network,
discussed bilateral relations and the EU-Latin America summit in May next year
Foreign Minister Dimitrij Rupel met on Thursday, 17 May his Costa Rican counterpart Bruno
Stagno Ugarte. The pair, meeting at the sidelines of the 9th ministerial of the Human Security
Network, discussed bilateral relations and the EU-Latin America summit in May next year,
Rupel told the press. <BR><BR>
The ministers agreed that relations between the countries were good and discussed
possibilities for boosting cooperation, said Rupel, who presented options for increasing trade
through the Slovenian port of Koper. <BR><BR>
7
The pair also discussed the Slovenian stint at the helm of the EU in the first half of 2008,
during which the EU-Latin America and Caribbean summit will take place in Lima, Peru, and
discussed relations between the EU and Costa Rica. <BR><BR>
Rupel explained that Costa Rica, the most developed country in Central America, played an
important role in the EU-Central America Association Agreement process, which would be an
important topic of the 5th EU-Latin America summit. <BR><BR>
According to Rupel, the summit in Lima will not be an easy one, but he sees Costa Rica as an
assistant in seeking suitable compromises. <BR><BR>
According to the Foreign Ministry, Rupel told Ugarte that he was pleased that the EU-Latin
America summit would take place during Slovenian EU presidency. <BR><BR>
Ugarte meanwhile said that the EU-Central America Association Agreement was extremely
important for Costa Rica, which wants to strengthen its trade ties with the EU. He hopes that
it will be possible to announce substantial progress regarding the agreement at the summit in
Lima.
OECD Membership Talks May Take Two Years, Official Says
Slovenia received the invitation to join nearly eleven years after it asked for membership in
the club associating the world's 30 leading economies
It may take two years before Slovenia becomes a member of the Organisation for Economic
Cooperation and Development (OECD), Dimitrij Grcar of the Economy Ministry said on
Friday, 18 May. Grcar told the press that membership talks could take that long because the
country was using up much of its resources getting ready to hold the EU presidency in the
first half of 2008. <BR><BR>
The OECD membership talks, which will also include the country's membership fee, will be
concluded when the country accedes to the OECD convention and signs an agreement under
which it accepts the obligations of OECD membership, Grcar explained. <BR><BR>
The talks include a wide array of areas, with Grcar labelling foreign investment, regulation,
transparency and efficiency of state administration as the toughest nuts to crack. Also
unpredictable are possible demands of existing OECD members, often linked to their interests
in a candidate country, he said. <BR><BR>
The country's first task is to appoint a negotiating team, while the programming document for
the talks will set Slovenia's commitments. The speed of the talks depends on the candidate
country, not the OECD, Grcar added. <BR><BR>
The OECD has some 160 legal instruments that Slovenia will be obliged to implement and, if
necessary, transpose into its legislation. Some are legally binding, such as the code of
liberalisation of capital movements, anti-corruption convention and guidelines for
multinational corporations. <BR><BR>
Slovenia received the invitation to join nearly eleven years after it asked for membership in
the club associating the world's 30 leading economies.
8
EUROPEAN UNION
PM Says Slovenia, Poland Have Similar Views on Open EU Issues
Speaking to reporters after a meeting with his Polish counterpart Jaroslaw Kaczynski, Jansa
said he was glad that the two countries shared the position that it was necessary to strengthen
the role of the new member states in the 27-nation bloc
Prime Minister Janez Jansa said on Monday, 14 May that Slovenia and Poland had "similar
views" on EU matters, including the currently topical issues concerning the future
institutional make-up of the bloc, the fate of the constitutional treaty and enlargement.
<BR><BR>
Speaking to reporters after a meeting with his Polish counterpart Jaroslaw Kaczynski, Jansa
said he was glad that the two countries shared the position that it was necessary to strengthen
the role of the new member states in the 27-nation bloc. <BR><BR>
Poland's positions are of interest for Slovenia as it gears up for its presidency of the bloc in
the first half of 2008. Poland has not ratified the constitutional treaty, in particular because it
opposes the introduction of double-majority voting. <BR><BR>
According to Kaczynski, talks focused on the EU constitution, while the pair also exchanged
views on Poland's relations with Ukraine and Russia, and the prospective EU membership of
Turkey and the Western Balkans. Kaczynski said Jansa was en expert on the situation in the
Balkans. <BR><BR>
Jansa, who was accompanied on his official visit to Poland by a big delegation of Slovenian
executives, said the talks with Kaczynski were an "intensive and very rich exchange of
opinions." <BR><BR>
Jansa also held talks with Polish President Lech Kaczynski. According to a source in the
Slovenian delegation, the EU constitutional treaty and the future of the bloc topped the agenda
along with EU and NATO enlargement. <BR><BR>
The pair is reported as having endorsed the membership prospects of Croatia, Macedonia and
other countries in the Balkans, provided they meet the set criteria. <BR><BR>
The prime minister also met the heads of the lower and upper chambers of parliament,
Ludwik Dorn and Bogdan Borusewicz.
Slovenian, Portuguese FMs Pledge Assistance in EU Presidency
Portugal could greatly assist Slovenia with its experiences and Slovenia could also aid
Portugal in tackling important challenges, Slovenian and Portuguese foreign ministers,
Dimitrij Rupel and Luis Amado, agreed as they discussed the upcoming EU presidency stints
of the two countries
Portugal could greatly assist Slovenia with its experiences and Slovenia could also aid
Portugal in tackling important challenges, Slovenian and Portuguese foreign ministers,
Dimitrij Rupel and Luis Amado, agreed as they discussed the upcoming EU presidency stints
of the two countries. <BR><BR>
The ministers met at a working dinner on Tuesday, 15 May evening, at the outset of Amado's
visit to Slovenia. According to the Portuguese officials, the preparations for Portugal's
presidency in the second half of 2007 were very different from when the country was gearing
up to chair the bloc in 1992 and 2000. <BR><BR>
According to him, preparations coordinated between Germany - the current EU president Portugal and Slovenia - which is to succeed Portugal - were a rewarding experience that
allowed Portugal to better understand the EU's dynamics. <BR><BR>
9
It was an interesting experience to draft a joint 18-month presidency plan with three such
different countries, as it was shown that different expectations and experiences can come
together as a very important programme, Amado said. <BR><BR>
The Portuguese minister also pointed to the responsibility that the countries have in
implementing the agreed presidency plan and added he was counting on Rupel and Slovenia's
experience in the Balkans during his country's term at the helm of the EU. <BR><BR>
Rupel meanwhile stressed the EU's constitutional treaty, saying he hoped Germany would be
able to draft a balanced proposal on the guidelines. <BR><BR>
"I think that Germany is doing a fine job and hope that we can keep as much of the original
text as possible," Rupel said, adding that it was impossible to ignore the popular vote in
France and the Netherlands as well as concerns by people in other EU members. <BR><BR>
"I think that the first part, which we had difficulties agreeing on, should remain as it is and we
will see about the rest," Rupel said. <BR><BR>
The ministers also discussed bilateral relations and talked about Croatia's bid to join the EU.
Amado is expected to visit Croatia on Wednesday, 16 May.
10
STATISTICS/FORECASTS
Wages Up 3.2% in March
The average gross wage in Slovenia was EUR 1,252.12 in March
The average gross wage in Slovenia was EUR 1,252.12 in March, which is 3.2% more than in
February, and was up 5% year-on-year. The average net wage meanwhile increased by 2.8%
to EUR 815.34, according to the National Statistics Office. <BR><BR>
The main reason for wages going up is March having three working days more than February,
which resulted in an 6.8% increase in the number of hours paid. <BR><BR>
The biggest gross wage increases over February were recorded in manufacturing (5.1%) and
construction (4.3%). <BR><BR>
The average gross wage for the first three months of 2007 stood at EUR 1,238.46, up 5.4%
year-on-year. In real terms, however, the increase was lower - 3% over the January-March
period in 2006.
Registered Unemployment at 8.1% in March
A total of 74,216 people were registered as unemployed in March
The registered unemployment rate in Slovenia stood at 8.1% in March, 0.3 percentage points
lower than the month before and a whole 2 points below that in March 2006, according to the
National Statistics Office. <BR><BR>
A total of 74,216 people were registered as unemployed in March, 4.4% down on February
and 18.8% down year-on-year. The registered unemployment rate was 6.6% among men and
10% among women. <BR><BR>
Slovenia's labour force numbered 920,020. A total of 845,804 were employed, which is an
increase of 0.5% compared to February and up 3.5% year-on-year. <BR><BR>
Of the employed, 88.815 were self-employed. Of the 756,989 who worked for other people,
688,999 held jobs at companies and 67,990 worked for entrepreneurs, up 2.9% and 5.4%
year-on-year, respectively. <BR><BR>
Interestingly, the number of farmers rose 12.1% compared to the year before to 36,109.
Factory Gate Prices Up 4.7% Y/Y
Factory gate prices rose by 0.3% in April over March
Factory gate prices rose by 0.3% in April over March, while they increased by 4.7% year-onyear, according to a report from the National Statistics Office. <BR><BR>
Prices of manufactured goods on the domestic market were up by 0.2%, while prices of export
products rose by 0.4% at the monthly level; in the euro area output prices grew by 0.7%,
while they dropped by 0.1% in other markets. <BR><BR>
The monthly increase in prices was generated by a 0.8% rise in the prices of intermediate
goods, energy products and raw material. Capital goods were dearer by 0.1%, while the prices
of consumer goods dropped by 0.3%. <BR><BR>
A 1% price hike was recorded in the supply of electricity, gas and water, while prices of
goods in agriculture, hunting, forestry and mining stayed put and those in manufacturing
edged up 0.3%. <BR><BR>
Among export prices of manufactured goods, the Statistics Office recorded price increases in
manufacture of metals (by 2.6%), in manufacture of wood and wood products and in
manufacture of electrical machinery (by 1%), in manufacture of pulp, paper and paper
products and in manufacture of TV and radio sets and equipment (by 0.8%). <BR><BR>
11
Some drops were also recorded export prices: manufacture of chemicals, chemical products
and man-made fibres was 0.6% cheaper, manufacture of medical, precision and optical
instruments cost 0.4% less and manufacture of leather, leather products and furniture was
0.3% less expensive.
Increasing Number of Fishermen Opting for Clam Breeding
The figures from the office show that clam breeding capacities were up 76.5% in 2006
compared to the year before
The Slovenian maritime fisheries sector is undergoing restructuring that is resulting in a shift
from fish breeding to clam breeding, data from the Statistics Office indicates. The figures
from the office show that clam breeding capacities were up 76.5% in 2006 compared to the
year before. <BR><BR>
The small Slovenian maritime fisheries sector employed 149 people in 2006, which is a 6.3%
drop over the year before. What is more, only half of the total number of employees worked
full time. <BR><BR>
The total catch by the Slovenian fisheries sector last year stood at 848 tonnes, down 17% over
the year before, data shows. The catch was the second-smallest since records began in 1990.
<BR><BR>
Moreover, while there has been a general fall in fish breeding activity, which contracted by
10% last year, the opposite is true for lam breeding, which is increasingly popular, the
Statistics Office found. <BR><BR>
The restructuring is being attributed to newly-designated clam breeding sites and the
awarding of new licenses in this branch of maritime fisheries. <BR><BR>
The Slovenian fishing fleet had 136 registered boats in 2006, 90 of them being used in fishing
and aquaculture, the Statistics Office said.
Number of University Graduates Up 8.6% in 2006
The biggest rise over 2005 was seen in the number of post-graduate degrees, which increase
25% to 1,899
The number of university degrees obtained rose by 8.6% to 17,145 in 2006, data from the
Statistics Office shows. The biggest rise over 2005 was seen in the number of post-graduate
degrees, which increase 25% to 1,899. <BR><BR>
According to the figures, two-thirds of the undergraduates completing their course were
women. The sexes were somewhat more evenly represented among those obtaining postgraduate degrees. <BR><BR>
Moreover, figures from the Statistics Office also show that nearly half of all undergraduate
degrees obtained last year were in social sciences and law. <BR><BR>
Social sciences were even more dominant among the obtained post-graduate degrees, as twothirds of all masters' degrees and doctorates were in this area.
12
FINANCE
NKBM Retains Market Share in Q1
Nova Kreditna banka Maribor (NKBM), Slovenia's second largest bank by assets, kept its
market share in the first quarter of 2007, as total assets rose by EUR 32m to EUR 3.7bn
Nova Kreditna banka Maribor (NKBM), Slovenia's second largest bank by assets, kept its
market share in the first quarter of 2007, as total assets rose by EUR 32m to EUR 3.7bn.
<BR><BR>
The bank's profit stood at EUR 8.8m, in line with plans and with the trends from last year,
when total assets were up by 23%, the bank said in a press release on Tuesday, 15 May.
<BR><BR>
The results, discussed by the company's supervisory board, also show that return on equity
stood at 14.9% in the period, one percentage point above the plans. <BR><BR>
NKBM posted a net profit of EUR 35.93m in 2006, up 4.5% over 2005 and 82% above plans.
Slovenia Earmarks EUR 7.8M for FDI Incentives in 2007 and 2008
According to Stanovnik, EUR 5.6m will be available in 2007 and EUR 2.2m in 2008,
however, the amount could be raised in case of increased interest
Slovenia earmarked EUR 7.8m for foreign direct investment (FDI) incentives in 2007 and
2008, Jan Stanovnik of the Public Agency for Entrepreneurship and Foreign Investments told
the press in Ljubljana on Friday, 18 May. <BR><BR>
According to Stanovnik, EUR 5.6m will be available in 2007 and EUR 2.2m in 2008,
however, the amount could be raised in case of increased interest. <BR><BR>
The aim of the public call for tenders, published in early May, is to create new jobs in
industries with higher value added, bring new technologies and know-how, facilitate
sustainable regional development and bring about synergistic effects between foreign
investors and Slovenian companies. <BR><BR>
Stanovnik added that the grants on offer were aimed at improving the competitive ability of
Slovenian companies and create 1,000 new jobs in the next three months. <BR><BR>
The tender is open for foreign investors, but the money will get to companies registered in
Slovenia which are at least in 10% ownership of a foreign company. <BR><BR>
Slovenia earmarked EUR 5m for FDI incentives in 2006, co-financing nine projects that
created 1,150 jobs, according to Sabina Kolesa, director general of the Directorate for Foreign
Economic Relations at the Economy Ministry.
Minister Believes Listing Slovenia's Top Insurer Best Option
Finance Minister Andrej Bajuk told the press that the state-run KAD fund would soon change
its role from a depositary of shares of Triglav, Slovenia's largest insurance company, to an
active owner
Finance Minister Andrej Bajuk told the press on Friday, 18 May that the state-run KAD fund
would soon change its role from a depositary of shares of Triglav, Slovenia's largest insurance
company, to an active owner. The best option for transparent privatisation would be to list the
insurer on the stock exchange, Bajuk believes. <BR><BR>
Bajuk, presenting amendments to the act on the privatisation of insurance companies, said the
Pension Fund Management (KAD) would have to ensure that KAD and the state-run
Restitution Fund (SOD) together retained 25% of the insurer plus one share. <BR><BR>
The proposed amendments, adopted by the government on Thursday, 17 May, say that KAD
should keep the 35.2% of Triglav that would have to be transferred to individuals under the
13
existing legislation. KAD would use the shares for payments to the pension and disability
insurance fund. <BR><BR>
The shares were previously allocated for some 750,000 claimants who in 1990 paid insurance
premiums to Triglav's predecessor. However, experts at the ministry found that the transfer of
these shares would be impossible both from a logistic and legal standpoint, Bajuk explained.
<BR><BR>
The previous government was also unable to distribute the shares, he added. <BR><BR>
The government will also unveil a proposal for the privatisation of Triglav in the coming
weeks, said Bajuk. <BR><BR>
The most transparent way to achieve that would be by listing the shares on the stock market,
he said without specifying how this would be done.
Ljubljana Stock Exchange
The SBI 20 benchmark index broke the 9,000-point-mark and finished the week at 9,395.96,
up 493.56 points (5.54%) over the previous week
Earnings reports for the first quarter spurred a buying frenzy on the Ljubljana Stock Exchange
(LJSE) last week that pushed Slovenian blue chips to records highs. The SBI 20 benchmark
index broke the 9,000-point-mark for the first time on Wednesday, 16 May and finished the
week at 9,395.96, up 493.56 points (5.54%) over the previous week, while the SBI TOP index
of the biggest blue chips ended the week 105.7 points (5.5%) higher at 2,027.13. <BR><BR>
The action was bustling, as brokers concluded nearly EUR 92m in deals last week, including
more than half in block deals. Pharma company Krka was the most active issue on the official
market, notching up deals worth EUR 10.7m. The share gained 4.49% on the week to close at
EUR 901.63, after reporting a 30% jump in its first-quarter profit. <BR><BR>
Shares of telco Telekom Slovenije were also in high demand last week, putting on 11.81% to
EUR 901.62. Matjaz Bernik, an analyst from the Ilirika brokerage, believes that investors are
pinning their hopes on the upcoming privatisation of a minority stake in the telco.
<BR><BR>
Bernik thinks the new round of gains on the LJSE can be attributed to a fresh injection of cash
into the market and the high hopes of investors regarding privatisation. <BR><BR>
Petrol was another hot item last week, racking up deals worth EUR 6.8m and gaining 4.71%
to EUR 633.66, having reported a 73% jump in first-quarter profit. <BR><BR>
Other major movers included technical goods retailer Merkur and Sava, which put on 12.48%
to EUR 327.10 and 9.83% to EUR 401.26, respectively. <BR><BR>
Home appliance group Gorenje was among the few shares that did not benefit from the
buoyant mood on the market, shedding 1.53% to EUR 35.94. <BR><BR>
Popular investment funds took their cue from the action on the official market, which
propelled the PIX investment fund index to 6,326.15, up 277.51 points (4.59%).
14
BRANCH INFORMATION
EUR 1.3m Project Gives Student Dorms Fast Internet Access
This means that over 9,000 students got internet access
Jure Zupan, the science, technology and higher education minister, presented on Monday, 14
May a EUR 1.3m project that has brought fast internet access to all Slovenian student dorms.
This means that over 9,000 students got internet access, Zupan told the press in Ljubljana.
<BR><BR>
The project brought internet access to the desks of all students living in dorms, with the
exception of facilities which are being denationalised or renovated. The project will continue
bringing internet access to dorms for secondary schools students which rent their rooms to
students. <BR><BR>
Zupan, speaking ahead of the world information technology day, observed on 17 May, said
that the project was launched in 2003 in student dorms in Ljubljana, Maribor, Kranj and
Portoroz. <BR><BR>
He also presented the Eduroam project that gives access to the intranet network of home
institutions to researchers abroad. <BR><BR>
Eduroam in Slovenia is currently set up at 31 locations, primarily faculties, research institutes
and secondary schools, while the ministry plans to include institutes and libraries in the
future.
15
COMPANIES
Slovenian, Croatian Camp Operators Sign Cooperation Deal
The Croatian tourist camp operator Valamar and the tourism division of the Slovenian
conglomerate Sava signed a deal on cooperation
The Croatian tourist camp operator Valamar and the tourism division of the Slovenian
conglomerate Sava signed in Ljubljana on Tuesday, 15 May a deal on cooperation. The deal
will increase the visibility of camps managed by the two companies, said Andrej Sprajc, the
head of the Sava tourism division. <BR><BR>
The first such deal between camps located in the two countries joins six camps in Slovenia
under the management of Sava and 21 hotels and nine camps in Croatia managed by Valamar.
Peter Fuchs, chairman of Valamar, said that the agreement crossed national borders and
presented a major achievement for the two companies as well as countries. <BR><BR>
The deal binds the signatories to cooperate in marketing, which should bring numerous
beneficial effects. <BR><BR>
According to Sprajc, tourism knows no bounds and the deal clearly shows that the two
companies are unfazed by disputes between the two countries.
Crisis Manager Leaves Mura Streamlined
The group is now facing a new period, which requires new measures and approaches to speed
up the implementation of its strategic plan, Mura said in a press release
In the wake of the departure of its chairman Borut Meh, textile group Mura assessed on
Monday, 14 May that the streamlining of the company, which demanded crisis management,
is completed. The company did not disclose the reasons for the departure of Meh, whose term
runs out on 15 August. <BR><BR>
The group is now facing a new period, which requires new measures and approaches to speed
up the implementation of its strategic plan, Mura said in a press release on Monday, 14 May.
<BR><BR>
Meh took over as Mura's chairman in 2002 when the company was facing bankruptcy and
some economists questioned whether the EUR 10m in state aid was not money wasted.
<BR><BR>
According to the press release, the company generated EUR 14.1m in operating revenues in
the first quarter of 2007, which is a 7% increase year-on-year and 16% above the targets. It
posted a profit of EUR 192,000 this year, while it recorded a EUR 305,000 loss in the same
period last year. <BR><BR>
The company had 5,600 employees in 2002, while the number today stands at 3,990. The
company sells its own trademarks in about 80 outlets throughout Europe.
Labour Ministry Confers Family-Friendly Company Certificates
The Labour, Family and Social Affairs Ministry conferred the first "family-friendly company
certificates" to 32 companies which pledged to implement a total of 305 measures to facilitate
reconciliation of work and family life
The Labour, Family and Social Affairs Ministry conferred in Ljubljana on Monday, 14 May
the first "family-friendly company certificates" to 32 companies which pledged to implement
a total of 305 measures to facilitate reconciliation of work and family life. <BR><BR>
The certificates, handed out in cooperation with the Development Partnership for YoungMothers-or-Family-Friendly Business, are the result of a EUR 437,000 project, organised as
16
part of the EU Equal programme, and are funded by the EU, Labour Minister Marjeta Cotman
told the press. <BR><BR>
In order to obtain the certificate, the companies had to pledge they would implement at least
three measures from a total of 110, Cotman told the press ahead of the International Day of
the Family, observed on 15 May. <BR><BR>
The measures were divided into eight categories: working time, organisation of work, jobs,
information and communication policy, management skills, personnel development, payments
structure, and family services. <BR><BR>
According to Cotman, the purpose of the project is to provide better quality of life in
households with children, which would indirectly influence the birth rate in Slovenia.
<BR><BR>
Moreover, the project uncovered that "there are instances of discrimination against young
families employed in companies. This project is aimed at changing this". The ministry is
furthermore drafting legislation to encourage the establishment of family-friendly companies,
she added. <BR><BR>
Cotman expressed hope that the EU budget for the 2007-2013 period would include a new
tender for family-friendly company certificates this autumn. "Companies have shown great
interest in the certificate, so we hope that the new tender will attract other employers," said
Cotman. <BR><BR>
The ministry decided to hand out the certificates under former minister Janez Drobnic in late
2006. A total of 33 companies applied for the certificate with one failing to obtain it because
it failed a formal criterion for being awarded the document - it has less than 10 workers.
Hidria Seeks to Become Top Automotive Player
Hidria Automotive, a division of the Hidria industrial conglomerate, has signed a strategic
supply contract with car maker PSA Peugeot Citroen which it hopes will boost the sales of its
automotive division from EUR 40m to EUR 100m in three years
Hidria Automotive, a division of the Hidria industrial conglomerate, has signed a strategic
supply contract with car maker PSA Peugeot Citroen which it hopes will boost the sales of its
automotive division from EUR 40m to EUR 100m in three years. <BR><BR>
The French car alliance entrusted Hidria the development and production of diesel cold start
systems, including those compliant with the Euro 5 standard. <BR><BR>
This means Hidria components will be built in almost all diesel vehicles produced by PSA
Peugeot Citroen from 2009, Iztok Seljak, vice-president of industrial sales and marketing, told
the press on Monday, 14 May. <BR><BR>
Hidria chief executive Edvard Svetlik added that the contract was a result of years of R&D
investment, as the company is already a top-four global producer of diesel cold start systems.
The PSA deal will contribute to the ambitious growth of Hidria's automotive division and its
reputation, he said. <BR><BR>
Hidria Automotive is on a mission to become the European market leader in certain segments
of the car industry and plans sales to the tune of half a billion euros by 2017, Seljak said.
<BR><BR>
Hidria has three main businesses: automotive, air conditioning and power tools. It is a nonpublic company and does not release annual results.
Iskra Avtoelektrika Ups Revenues, Profit in Q1
Iskra Avtoelektrika, a maker of electrical components for the car industry, generated EUR
45m in revenues in Q1 2007
Iskra Avtoelektrika, a maker of electrical components for the car industry, generated EUR
45m in revenues in Q1 2007, up 25% over the same period last year. Operating profit was at
17
EUR 2m and net profit topped EUR 1.3m, Iskra Avtoelektrika said on Tuesday, 15 May.
<BR><BR>
The Iskra Avtoelektrika group meanwhile increased its consolidated revenues by 24% to EUR
57m, meeting 26% of its yearly plan despite high price of inputs. <BR><BR>
The growth came about mainly because of sales abroad and growth in the sales of its
subsidiaries in Iran and China. <BR><BR>
The results were scrutinised and approved by the company's supervisory board.
Slovenia Set to Get New Mobile Operator
The company signed a deal with Slovenia's largest mobile operator, Mobitel, on national
roaming until it builds its network
Slovenia is set to get its third mobile operator, as Tusmobil, owned by retail magnate Mirko
Tus, gears up to launch its services. The company signed on Tuesday, 15 May a deal with
Slovenia's largest mobile operator, Mobitel, on national roaming until it builds its network.
<BR><BR>
Under the deal, Tusmobil users will be able to use Mobitel's network in areas that are not yet
covered by Tusmobil's base stations. <BR><BR>
"This deal is an important step forward in the launch of a third mobile operator in Slovenia,"
Mobitel general manager Klavdij Godnic said in a press release circulated by Mobitel's
parent, Telekom Slovenije, on Tuesday, 15 May. <BR><BR>
Meanwhile, daily Dnevnik reports on Wednesday, 16 May that Tusmobil is set to launch
commercial services in about two months' time. <BR><BR>
Tusmobil director Marko Fujs had in January said the company was gearing up for the launch
of services. Under the rules of its frequency licence, the operator must begin using the
frequencies by June, although that does not mean it has to launch commercial services at this
time. <BR><BR>
Tusmobil was reported in March to be building 147 base stations around Slovenia. Its goal is
to provide full national coverage with its network - until it achieves this, it will rely on the
help of Mobitel's network.
Moreover, Tusmobil plans to work together with Voljatel, a telecommunications company
specialising in internet services, in providing all-around telecommunications services, Fujs
told the daily Dnevnik on Wednesday, 16 May. <BR><BR>
Mirko Tus, who owns Engrotus, Slovenia's third-largest grocery chain, bought Voljatel late
last year in a deal reportedly worth EUR 20-25m. <BR><BR>
Voljatel had only months before launched mobile telephony services under its Izimobil prepaid brand that uses the Mobitel network. <BR><BR>
Tusmobil bought its frequencies from the defunct mobile operator Vega, which was owned by
US company Western Wireless International. Vega ceased operations in April of last year
after a rocky five-year stint in Slovenia, which saw it attract only around 20,000 users.
<BR><BR>
The company, which offered only voice and SMS services, had claimed that a lack of
regulation on the market stifled competition, but in the end decided not to pursue a massive
anti-trust lawsuit against the state. <BR><BR>
Mobitel, owned by the state-owned telco, and Simobil, owned by Austria's Mobilkom, are
currently the only mobile operators in Slovenia. The country also has three mobile service
providers, which rely on Mobitel and Simobil's networks.
Simobil Increases Revenues, Operating Profit Trebles
Simobil, Slovenia's second-largest mobile operator, reported revenues of EUR 34.6m for the
first quarter of 2007
18
Simobil, Slovenia's second-largest mobile operator, reported revenues of EUR 34.6m for the
first quarter of 2007, up 34.6% year-on-year. Operating profit nearly trebled to EUR 5.2m on
the back of strong subscriber growth. <BR><BR>
The number of users increased by 23,000 (19.7%) in the first quarter, to top 443,900. Yearon-year, the number of users increased by 38.6%, the company said in a press release on
Wednesday, 16 May. <BR><BR>
Simobil, which is a part of the Telekom Austria group, also increased its market share by 2.7
points compared to the year before, to 25.7%. <BR><BR>
The market leader, Mobitel, holds about 70% of the market.
Petrol Ups Net Profit by 44% in Q1
The groups sold 441,000 tonnes of oil products in Q1
Energy group Petrol posted a net profit of EUR 9.8m, 44% more than in the same period last
year. One of Slovenia's largest companies meanwhile generated revenues to the tune of EUR
426.4m, 2% below those recorded in the same period last year, Petrol said on Wednesday, 16
May. <BR><BR>
The supervisory board assessed the group's operations as successful as Petrol managed to
offset lower revenues resulting from the mild winter with positive results in other segments.
<BR><BR>
The groups sold 441,000 tonnes of oil products in Q1, 7% less than last year, with heating oil
being hit by the largest drop in sales (42%). The mild winter also caused a 17% drop in the
sales of natural gas. <BR><BR>
This was partially offset by a 17% increase in the sales of fuels, Petrol said in a press release.
<BR><BR>
The company operated 364 gas stations at the end of March, 305 in Slovenia, 36 in Bosnia, 21
in Croatia and 2 in Serbia. <BR><BR>
The Petrol Group sold 94,609 MWh of electricity, 3% more than in the same period in 2006.
Krka Q1 Profit Up 30%
Pharma group Krka has reported revenues of EUR 204.2m for the first three months of 2007
Pharma group Krka has reported revenues of EUR 204.2m for the first three months of 2007,
a 13% increase compared to the same period last year. Its net profit rose by 30% to EUR
38.1m, the company said on Thursday, 17 May. <BR><BR>
Foreign markets accounted for 87% of the group's sales. The group recorded the strongest
growth in sales in central Europe, which accounted for 27% of all sales. <BR><BR>
Eastern Europe accounted for 25% of the sales, followed by western Europe and overseas
markets (18%), and southeastern Europe (17%). <BR><BR>
In a press release posted on the Ljubljana Stock Exchange's website on Thursday, 17 May, the
company's management said the group had achieved all the main goals for the first quarter.
Merkur Group Sales Revenues Up 27.6% in Q1
Technical goods chain Merkur increased its sales revenues by 27.6% to EUR 243m in the first
quarter of 2007 compared to the same period last year and doubled its net profit to EUR
2.77m
Technical goods chain Merkur increased its sales revenues by 27.6% to EUR 243m in the first
quarter of 2007 compared to the same period last year and doubled its net profit to EUR
2.77m, Merkur said on Thursday, 17 May. <BR><BR>
Sales in Slovenia were up by more than 20% over the previous year, whereas sales revenues
abroad were 80% above those posted in the same period in 2006, the supervisory board of
Merkur was told at the session. <BR><BR>
19
Merkur's supervisors also confirmed the company's plans for the period until 2012, which see
the company becoming the leading technical goods trader in Southeast Europe. <BR><BR>
Merkur is currently building a new retail centre in Novi Sad, Serbia, and also planning the
construction of additional 14 centres in Slovenia, Croatia, Serbia and Bosnia-Herzegovina, the
company also said.
Telekom Step Closer to Privatisation
The commission overseeing the sale of the government stake in telco Telekom Slovenije chose
the bid of CA IB Corporate Finance as the appraiser and consultant in the telco's
privatisation
The commission overseeing the sale of the government stake in telco Telekom Slovenije
chose the bid of CA IB Corporate Finance as the appraiser and consultant in the telco's
privatisation. The international tender for the sale of a minority stake in the telco is expected
to be published by the end of August 2007, the Finance Ministry said on Friday, 18 May.
<BR><BR>
The commission initially published a public tender for three segments - review, valuation and
consultancy - but none of the applicants satisfied the conditions for the first segment.
<BR><BR>
Two of the competing companies withdrew their bids, as they intended them for all three
segments together, making CA IB Corporate Finance and its subcontractor the most
favourable bidders for the other two segments. <BR><BR>
The tender for the first segment will now be repeated, with the deadline for bids set for next
Wednesday, 16 May. <BR><BR>
The plans to sell 39% of the telco to a strategic investor were unveiled in March by Economy
Minister Andrej Vizjak. <BR><BR>
The state, which owns 74% of Telekom along with the state funds KAD and SOD, intends to
keep a controlling stake of 25% plus one share, the government announced in March.
<BR><BR>
A stake of up to 10% will be earmarked for compensation to people who invested in the
public telephone network in accordance with the act on the return of investments in the public
telecommunications network. <BR><BR>
The 39% holding will either be sold in its entirety, or the government may decide to sell one
part of the stake first and the second part in three years.
Lipica Institution Looking for Government Bail Out
The council of Kobilarna Lipica needs EUR 2.2m from the government
The governing body of the institution managing the renowned Lipica Stud Farm plans to ask
the government to bail it out of old debts and to provide it with money for urgent maintenance
works. The council of Kobilarna Lipica needs EUR 2.2m from the government. <BR><BR>
The decision was taken by the council at a session on Thursday, 17 May, Kobilarna Lipica
said in a press release on Friday, 18 May. The institution running the Lipizanner stud farm
also needs EUR 500,000 to launch the commercial operations at Lipica under the company
Lipica Turizem. <BR><BR>
The commercial offshoot would be established under a 2006 government strategy for the
development of the cultural monument that has been facing a severe cash crisis for years.
<BR><BR>
The council also intends to ask the government to provide the stud farm's institutions regular
budget funds from all the relevant ministries in order to ensure its existence and good
conditions for the world-famous white horses. <BR><BR>
20
Moreover, the body called on the management of the institution to begin activities required to
launch a public-private partnership in the field of tourism. The strategy adopted by the
government for Lipica has been linked with the expansion of a golf course at Lipica.
Outgoing CEO Praises Quality of Apparel Maker Mura
Meh, who has recently announced that he was leaving the Murska Sobota-based company,
said the best buyer for Mura would be a strong fashion design company as Mura is capable of
producing demanding quality garments
Borut Meh, the outgoing chairman of apparel maker Mura, has said that Mura was the most
important fashion label in Slovenia. It would be impossible for to increase its market share in
the country, Meh told the weekly Mladina. <BR><BR>
Meh, who has recently announced that he was leaving the Murska Sobota-based company,
said the best buyer for Mura would be a strong fashion design company as Mura is capable of
producing demanding quality garments. <BR><BR>
Indeed all big German, French or Italian fashion labels focused on design and marketing,
however, outsourced their production, which is Mura's opportunity, he added. <BR><BR>
The EUR 10m in state aid paid to Mura in 2002 saved the company from bankruptcy, Meh
said, however added that other companies got bigger grants. <BR><BR>
Admitting that maybe he also was to blame for not securing more aid to Mura as he was not
pleading for money with ministers, he pointed out that whenever Mura representatives called
for aid, they were told that the company was given money in 2002 and could receive no more
funds. <BR><BR>
He said that five years of crisis management took their toll on him and added that he had
received job offers but had not yet decided on where to go. <BR><BR>
He meanwhile told the Maribor-based daily Vecer that one of Mura's problems is its dispersed
ownership. There are over 3,000 owners, so none of them feels compelled to play an active
role in Mura, Meh said. <BR><BR>
Moreover, it would not be wise to list Mura on the stock market at the moment. Listing the
issue would make sense when Mura is transformed and can generate profit for its owners.
Adria Flying to UK and Ireland Destinations in Summer
Slovenian flag carrier Adria Airways has announced it is resuming regular flights from
Ljubljana to Birmingham, Manchester and Dublin
Slovenian flag carrier Adria Airways has announced it is resuming regular flights from
Ljubljana to Birmingham, Manchester and Dublin. The company plans to carry 16,000
passengers on the three lines over the summer. <BR><BR>
Adria said it would operate two weekly flights from Ljubljana to Manchester (Wednesdays
and Saturdays), a weekly flight to Birmingham (Wednesdays) and a weekly flight to Dublin
(Saturdays), starting in May. <BR><BR>
The Ljubljana-Manchester route has been operational since 9 May, the Ljubljana-Birmingham
route since 16 May, while the first flight to Dublin is scheduled for 26 May. <BR><BR>
The airline expects that the biggest interest for tickets will be among UK and Irish tourists
looking to spend their holidays in Slovenia.
21
FAIRS, CONGRESSES
Private Sector Crucial in Development, Conference Says
The increasing clout of the private sector in development topped the agenda as a World Bank
conference on development economics got under way at Bled on 17 May
The increasing clout of the private sector in development topped the agenda as a World Bank
conference on development economics got under way at Bled on Thursday, 17 May. Three or
four decades ago the World Bank did not pay much attention to the private sector, now
everyone is betting on it, Finance Minister Andrej Bajuk said in his keynote address.
<BR><BR>
Without a strong private sector, Slovenia's transition would not have been as successful as it
was, Bajuk said, and Slovenia would not have become the first EU newcomer to adopt the
euro. <BR><BR>
This experience is the guiding line in Slovenia's own development aid: it is focused on the
development of the private sector to enable developing countries to achieve development in
accordance with their own wishes. <BR><BR>
"The role of the private sector is more topical than ever," stressed Prime Minister Janez Jansa
in his address. He said words needed to be turned into actions, as "research is successful when
it actually helps the underdeveloped to achieve faster growth and progress." <BR><BR>
Jansa said philanthropy was noble and necessary, but there were other forms of aid: for
developing countries to achieve sustainable development, it takes economic, social and
political mechanisms that need to include the public as well as the private sectors.
<BR><BR>
According to Jansa, it is however crucial that the private sector observes United Nations rules
by protecting human rights, respecting environmental standards and refraining from the use of
forced or child labour. <BR><BR>
Jansa also noted the auspicious selection of Bled as a location for what is one of the biggest
development events in the world. He said Slovenia had walked a tough path since it became
independent in 1991 and was now at the highest stage of development in its history.
<BR><BR>
What is more, it has turned from aid recipient to aid donor. Jansa said it was justified to
expect that Slovenia would continue to do more in this field and the country was certainly
committed to allocating 0.17% of GDP for development aid by 2010. <BR><BR>
Bajuk echoed Jansa's words, saying in a statement for the press that Slovenia would
participate in the World Bank's efforts to eradicate poverty "to the best of its abilities". It will
also strive to preserve the key values of the welfare state at home. <BR><BR>
Hopeful that companies would join in these efforts too, Bajuk said that "in our new role as
donor country, it is very important that we join the efforts."
Panel Finds Development Aid a Challenge for EU Newcomers
EU newcomers became donors of development aid when they joined the bloc, which poses a
major challenge for them, found the panel at the World Bank's Annual Bank Conference on
Development Economics
EU newcomers became donors of development aid when they joined the bloc, which poses a
major challenge for them, found the panel at the World Bank's Annual Bank Conference on
Development Economics on Thursday, 17 May. However, they have a wealth of experience
with the process of transition, which they can mediate to aid recipients, according to Maja
Bucar. <BR><BR>
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Bucar, an expert on international relations from the Ljubljana Faculty of Social Sciences, said
the biggest risk for the newcomers was budget restrictions in the planning of development aid
until 2015: they are expected to increase development aid to 0.17% of GDP by 2010 and
0.33% by 2015. <BR><BR>
A half of the increase will be channelled to Africa in accordance with the EU's guidelines, but
the member states are also obliged to coordinate aid, according to Bucar. <BR><BR>
Paul Hoebink of the Dutch Centre for International Development Issues Nijmegen, underlined
the need for coherence of trade and agricultural policies with development policy.
<BR><BR>
Agricultural policy often has a negative impact on the development of poor countries, he said,
naming as an example the high subsidies for US rice growers which effectively keep African
farmers from the market. <BR><BR>
Gordana Lazarevic, who is in charge of development at the Serbian Ministry of Foreign
Economic Relations, meanwhile presented the view of aid recipients. <BR><BR>
She said the recipients want to play a bigger part in the framing of development aid priorities.
First Adriatic Tourism Conference Takes Off in Ljubljana
The Adriatic Sea is of extreme importance for the development of tourism in the region
The 1st International Adriatic Mayors' Conference, aimed at strengthening cooperation in the
Adriatic area and exchanging experience between cities in the region, opened in Ljubljana on
Thursday, 17 May. <BR><BR>
The Adriatic Sea is of extreme importance for the development of tourism in the region, said
Marjan Hribar, the head of the Tourism Directorate at the Economy Ministry. <BR><BR>
However, this potential is not passing unnoticed by foreign businesses, which are increasing
their investments in tourism in the region, he warned. <BR><BR>
This piece of Europe has secured its position on the world tourist map, however, further
cooperation between the countries lying along the Adriatic is needed to increase the region's
importance, Hribar pointed out. <BR><BR>
Meanwhile, Slovenia is opening to a new type of tourism - cruises. Until the end of the year,
eight cruise ships are scheduled to stop at the port of Koper, bringing around 50,000 visitors
to Slovenian shores, Hribar revealed. <BR><BR>
One quarter of all overnight stays at the Slovenian coast result from tourism, a trend that is
bound to continue, he said.
Potocnik Says Private Sector Crucial in Development Aid
Like many global changes underway today, such as climate change and access to health, food
and drinking water, development can be tackled with the prudent inclusion of the private
sector, Potocnik said on the margins of an international development conference
European Science and Research Commissioner Janez Potocnik believes that the private sector
is a key component in development aid. Like many global changes underway today, such as
climate change and access to health, food and drinking water, development can be tackled
with the prudent inclusion of the private sector, Potocnik said on the margins of an
international development conference on Thursday, 17 May. <BR><BR>
"Yet only if the private sector understands this as an opportunity to invest in the future, only if
it is a part of the solution, can we be successful in tackling global issues," Potocnik said on the
sidelines of the World Bank's Annual Bank Conference on Development Economics at Bled.
<BR><BR>
According to Potocnik, donations are still very important and the EU is the biggest donor of
development aid in the world, which is often underreported. However, donations alone cannot
solve all the problems. <BR><BR>
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The system needs to be framed that those who are facing poverty, sickness and famine are
helped to stand on their own feet. "Only this can lead to long-term success," he said.
<BR><BR>
The World Bank's conference, one of the biggest development events in the world, is focusing
this year on the role of the private sector in development.
Finance Minister Pleased with World Bank Conference
"We are very pleased as the event unfurled in accordance with our expectations," Bajuk said
Finance Minister Andrej Bajuk was extremely pleased with the course of a World Bank
conference on development economics that concluded at Bled on Friday, 18 May. "We are
very pleased as the event unfurled in accordance with our expectations," Bajuk said.
<BR><BR>
He pointed to the presentations of theoretical know-how, experience and debates, mainly
regarding the development of private partnerships. "This is a very important area for us. We
are just beginning to take that path," he said in reference to the recently passed public-private
partnership act. <BR><BR>
Bajuk added that the resignation of World Bank president Paul Wolfowitz did not overshadow
the conference, however "it did take some of the spotlight away". <BR><BR>
Shigeo Katsu, regional vice-president for Europe and Central Asia at the World Bank,
expressed hope that the event spurred new ideas, aided in the promotion of development
economics and new solutions for uprooting poverty. <BR><BR>
The final event of the annual Annual Bank Conference on Development Economics
(ABCDE) was a plenary on privately-operated public services. The participants were
unanimous that improving public services presented one of the key global challenges.
<BR><BR>
According to Maitreesh Ghatak of the London School of Economics, efficient public services
are one of the cornerstones for maintaining quality of life. <BR><BR>
Ghatak believes that the market alone does not guarantee efficient public services, so the state
should take part in providing them. While corruption is often cited as the reason for the
inefficiency in services, he said absenteeism presented a larger problem.
Companies Buy Vistas for Profit, Exec Says
Matjaz Gantar, the head of investment firm KD Group, said on Friday, 18 May that
companies acquire plots with scenic views in order to make profit
Matjaz Gantar, the head of investment firm KD Group, said on Friday, 18 May that
companies acquire plots with scenic views in order to make profit. A clear strategy for
investments is also needed, Gantar said in Ljubljana on the second day of a conference on the
Adriatic Sea, attended by mayors from cities of Adriatic countries. <BR><BR>
Answering the question whether the Adriatic could become a new destination for European
investment, Gantar said that he would not advise his business partners to invest in any other
Adriatic country but Italy. <BR><BR>
Recently established countries often do not know where they are going and what they want to
become, Gantar said in reference to the countries that were once part of Yugoslavia that line
the Adriatic's eastern shore. <BR><BR>
His view was echoed by all participants of the panel on lobbying and investment on the
Adriatic coast as part of public-private partnerships, who were also asked how to reconcile
profit-making with conserving the environment. <BR><BR>
Marko Kryzanowski, the head of Slovenian energy group Petrol, said that the society was
split as it wanted to live comfortably and conserve the environment at the same time.
<BR><BR>
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Tourism is the most demanding branch of the economy, it is extremely wasteful from an
energy point of view and at the same time demanding ecologically, Kryzanowski added.
<BR><BR>
Also lacking is a strategy to harmonise tourism and logistics, he said at the debate that centred
on the necessity of ways to balance infrastructure investment and maintaining the
environment. <BR><BR>
Croatian lawyer Vladimir Filipovic said that some EUR 3bn are currently being invested in
the Croatian coast, however, the investors are facing a lot of red tape. <BR><BR>
Administrative procedures in Croatia are being simplified, replied Snjezana Bagic, a state
secretary at the Croatian justice ministry. <BR><BR>
The two-day event presented major cities along the Adriatic coast, while the mayors of
Trieste, Venice, Dubrovnik, Budva, Neum, Tirana, Rijeka and Izola put forth their views,
expectations and dilemmas on the current situation and development possibilities of the real
estate markets in the region.
25
SLOVENIA IN BRIEF
Health Minister Outlines Slovenia's EU Presidency Priorities
Health Minister Andrej Brucan has met counterparts from several EU states to discuss
Slovenia's priorities in health during its spell as EU president in the first half of 2008. "I
presented our priorities, especially fighting cancer, patient mobility, prices of medicine" and
other issues, Brucan said in Geneve on Tuesday, 15 May.
Slovenia and Austria Agree on Cooperation in Culture, Education
The Slovenian-Austrian commission for cooperation in culture, education and science adopted
on Wednesday, 16 May in Ljubljana the second programme for cooperation between the two
governments for the 2008-2012 period.
Government Adopts Resolution to Boost Cooperation in Higher Education
The cabinet adopted on Thursday, 17 May a draft national higher education resolution for the
2007-2010 period. The aim of the document is to create a single higher education and
research area and increase the funds for higher education studies and research to 5% of GDP,
Dusan Lesjak of the Ministry of Higher Education told the press.
Government Adopts Changes to Crafts Industries Act
The cabinet adopted on Thursday, 17 May amendments to the crafts industries act, which aim
at reducing red tape in the sector, Economy Minister Andrej Vizjak said after the session. The
proposed changes deal with procedures to open a small business, vocational requirements and
membership fee payments to the Chamber of Crafts Industries (OZS).
Slovenia Gets Seat in UN Human Rights Council
The UN General Assembly overwhelmingly voted on Thursday, 17 May in favour of
Slovenia's bid for a seat on the UN Human Security Council. Slovenia got 167 votes of the
necessary 97 in its second attempt to secure a seat on the body.
Sturm, Costa Focus on Modernisation of Judiciary
Preparations for Portuguese and Slovenian successive stints at the helm of the EU and
modernisation of judiciary system topped the meeting between Justice Minister Lovro Sturm
and his visiting Portuguese counterpart Alberto Costa on Friday, 18 May.
Jansa, Gusenbauer Upbeat about Solution for Bilingual Signs
Prime Minister Janez Jansa and visiting Austrian Chancellor Alfred Gusenbauer expressed
optimism on Friday, 18 May about a solution for Slovenian-German city limits in the Austrian
province of Carinthia. It is too early as yet to talk about a result, but one "cannot exclude the
possibility" that an agreement will be reached by the summer, Gusenbauer told reporters.
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