Slovenia Business Week no. 22, June 11th, 2006
Table of Contents:
HEADLINES ................................................................................................................. 3
Slovenian Trade Offices Abroad Present Their Work................................................ 3
Economic and Social Council Increases Work Permit Quotas................................... 3
Economic Growth at 7.2% in Q1................................................................................ 4
INTERNATIONAL COOPERATION .......................................................................... 6
Slovenia's Planned Rail Investment Half of Austria's ................................................ 6
Economy Minister Discusses Cooperation With UNIDO .......................................... 6
Parliament Speakers Agree Norway, Slovenia Should Boost Cooperation ............... 6
Macedonia and Slovenia for EU Expansion to Western Balkans .............................. 7
Bajuk Promotes Slovenia as Investment-Friendly Country ....................................... 7
Slovenian, Croatian Railway Operators to Boost Cooperation .................................. 8
Parliament Speaker Discusses EU, NATO with Norwegian MPs.............................. 9
Parliament Speaker and Norwegian FM Discuss Kosovo, Middle East .................... 9
EUROPEAN UNION .................................................................................................. 10
PM Says Broad Consensus Key to Successful Euro Changeover ............................ 10
Brussels: Notaries Only Serious EU Law Infringement Case vs. Slovenia ............. 10
Slovenian, Swedish PMs Call for Compromise on EU Constitution ....................... 11
Turk: People and Environment Key to Slovenia's Lisbon Vision ............................ 11
Slovenia Seeking to Extend EU Roaming Charge Cap to Croatia ........................... 12
Finnish Ex-FM: Smaller Members More Successful at EU Presidency .................. 12
EU Fails to Agree on Postal Service Liberalisation Date ......................................... 12
Lenarcic: Preparations for EU Presidency According to Plan ................................. 13
Slovenia Calls for Equality in Managing EU Sat-Nav System ................................ 13
Over 1,300 Civil Servants Preparing for EU Presidency ......................................... 14
STATISTICS/FORECASTS........................................................................................ 14
Ljubljana Attracting More and More Visitors .......................................................... 14
Imports Surge by 27% Year-on-Year ....................................................................... 15
Industrial Output Down 7.8% over March, Up 13.1% Y/Y ..................................... 15
FINANCE .................................................................................................................... 16
Vizjak: Regulating Venture Capital Means More Competitiveness ........................ 16
Triglav Acquires Leading Macedonian Insurer ........................................................ 16
Finance Minister Cautious about Fate of Lower Housing VAT .............................. 17
IMAD: ECB Rate Rise Reflects Fear of Overheating .............................................. 17
Pension Fund Enters Ukrainian Market.................................................................... 18
Experts Call for Rise in Retirement Age .................................................................. 18
President Nominates Kranjec as Central Bank Governor ........................................ 18
Ljubljana Stock Exchange ........................................................................................ 19
REGIONAL INFORMATION .................................................................................... 21
Ljubljana Landfill Turned into Golf Course............................................................. 21
BRANCH INFORMATION ........................................................................................ 22
Commissioner Praises Consumer Protection in Slovenia......................................... 22
Commissioner Says Consumer Protection Vital for Common Market .................... 22
Erjavec: Defence Tenders Opportunity for Slovenian Companies .......................... 23
Slovenians Abandoning Fixed-Line Calls ................................................................ 23
COMPANIES .............................................................................................................. 25
Plans for EUR 750m Mega Gaming Centre Unveiled ............................................. 25
KD Holding Bids to Acquire Oldest Slovenian Department Store .......................... 25
Market Leader UPC Telemach Buys Rival Cable Operator ..................................... 26
Pivovarna Lasko Fails in Bid to Acquire Serbian Brewer........................................ 26
Ryanair Launches Flights to Maribor ....................................................................... 27
Mobitel, Simobil Expect No Problems with Roaming Fee Caps ............................. 27
SLOVENIA IN BRIEF ................................................................................................ 29
Serbian Carrier Cancels Belgrade-Portoroz-Rome Route ........................................ 29
Shipyard Sells Its Real Estate ................................................................................... 29
Ljubljana Airport Renamed in Honour of Dissident Pucnik .................................... 29
Koletnik Joins Zagozen at Helm of HSE.................................................................. 29
HEADLINES
Slovenian Trade Offices Abroad Present Their Work
Heads of four Slovenia's trade offices abroad presented their activities, giving
Slovenian businessmen the first chance to learn about the markets where the offices
operate, and the services that they offer
Heads of four Slovenia's trade offices abroad presented their activities on Monday, 4
June, giving Slovenian businessmen the first chance to learn about the markets where
the offices operate, and the services that they offer.
Boosting the penetration of foreign markets and attracting incoming foreign direct
investment are the Economy Ministry's priorities and the main tasks of the trade
offices abroad, said Sabina Kolesa, the head of the Directorate for Foreign Economic
Relations.
The trade offices open where they seem necessary and the aim of the Public Agency
for Enterprise and Foreign Investment is that there be as many direct contacts as
possible and that Slovenian companies acquire as much information as possible, said
the agency's acting director, Peter Jesovnik.
The agency is hoping to open more offices next year, which would be enough for a
while. Jesovnik said that if Slovenian companies did not show enough interest,
individual offices could be closed and opened somewhere else.
Slovenia currently has trade offices in Germany, Italy, Romania and Turkey. Four
more are to open in the autumn, this time outside the EU.
The ministry did not reveal where, however a while ago Economy Minister Andrej
Vizjak said that possible locations were Saudi Arabia, Ukraine, Argentina or Brazil,
and China.
Meanwhile, the provisional director of the Chamber of Commerce and Industry Samo
Hribar Milic said that the chamber strongly supported the opening of trade offices in
distant countries.
He added that Slovenian business should not focus only on one market, but should
diversify exports.
Economic and Social Council Increases Work Permit Quotas
The Economic and Social Council, the industrial relations forum, has reached an
agreement to increase the quota for work permits for foreign workers from 18,500 to
24,500
The Economic and Social Council, the industrial relations forum, has reached an
agreement on Monday, 4 June to increase the quota for work permits for foreign
workers from 18,500 to 24,500.
The members of the council also agreed to prepare a detailed analysis of employment
of foreigners as part of the economic migrations strategy, which the Labour, Family
and Social Affairs Ministry is to draft by September.
The ministry proposed to increase the quota because only some 400 work permits
were left by the end of May, representative of the national Employment Service
explained. The ministry thus suggested that the quota should increase by 4,870
permits.
The majority of trade unions supported the proposal, while the employers found it
unacceptable. Igor Antauer, the secretary general of the Craft Industries Employers'
Association, said that the increase would only cover the applications that had already
been filed.
Joze Smole of the Chamber of Commerce and Industry (CCIS) meanwhile explained
that there was a lack of workers for the haulage, construction, hospitality and
metallurgy sectors in the unemployment registry. In his opinion it is necessary to
make use of the current economic growth and solve the problem by increasing the
quota. The chamber therefore suggested that the quota be increased by 15,000.
Dusan Semolic, the head of the Association of Free Trade Unions of Slovenia (ZSSS),
meanwhile said that the employers underestimated the power of wages. In his opinion
the lack of workforce could be reduced by increasing wages.
The council also discussed changes to the labour relationship act. The employers
reproached the Labour Minister Marjeta Cotman that she had erased the provisions on
past work from the changes and requested some time to discuss the new draft
changes.
The trade unions meanwhile said that the provisions were not the subject of talks,
adding that if the employers insisted on the provisions, the talks could return to the
beginning, which would mean the act would remain unamended.
The members of the council nevertheless agreed that all the provisions of the changes
that were the subject of negotiations have been harmonised. The employers and the
KNSS Independence trade union also got 14 days to form a position on the changes
and present it at the council's session.
Economic Growth at 7.2% in Q1
Fuelled by flourishing exports, domestic spending and investment, Slovenia's
economy expanded at an annual rate of 7.2% in the first quarter of this year
Fuelled by flourishing exports, domestic spending and investment, Slovenia's
economy expanded at an annual rate of 7.2% in the first quarter of this year, the
Statistics Office said on Friday, 8 June.
This is the fastest rate of economic growth in Slovenia since the second quarter of
1999, when a spending rush ahead of the introduction of value added tax provided a
one-time boost to growth, Karmen Hren of the Statistics Office told the press on
Friday, 8 June. It is also the fifth consecutive quarter that the economy has expanded
at near or above 5%.
Slovenia's exports were the main motor of growth in the first quarter, expanding by
13.6% compared to the same period a year ago, said Hren, who added that imports
also grew robustly (13.7%).
Hren told the press conference that the economic growth figures did not come as a
surprise, since all indicators had been pointing to the fact that the economy was in
good shape.
This was echoed by Economy Minister Andrej Vizjak, who said his ministry was
pleased with the growth rate. "It seems the measures taken by the government and
other players are the right ones and that they have bolstered the positive mood in the
economy," Vizjak told STA.
He added that the ministry had been looking forward to strong growth given the
trends in exports and investments. "But I must admit that we are pleasantly surprised
by the final figure," said Vizjak, who termed the growth rate "a big achievement".
In the first reaction, Slovenia's economists hailed the rate of growth and predicted a
bright future.
Saso Polanec of the Ljubljana Economics Faculty told STA the current robust growth
was a result of Slovenia's integration into the common EU market, the strong
consumption demand in Germany and the fast growth of Slovenia's construction
sector.
If this rate of growth continues, Slovenia will catch up with Italy in terms of GDP per
capita within three to four years, said Polanec.
Polanec added that the strong demand in Germany, Slovenia's main export market,
was a result of the recent reform of Germany's labour legislation, which had improved
productivity in Europe's biggest economy.
Meanwhile, France Krizanic also pointed to the importance of a warm winter in
boosting Slovenia's economic growth rate. The member of the Ljubljana Law
Faculty's Economic Institute added that strong growth was expected to continue in the
coming months, although at a somewhat less intense rate, since the first quarter was
extraordinary.
Hren told the press conference that gross fixed capital formations expanded by 21.6%,
contributing significantly to the overall growth.
The high investment spending was fuelled by a flourishing construction sector, which
with the help of a warm winter expanded by nearly 30% compared to last year.
According to Hren, motorway construction led the way.
Strong growth was also witnessed in the manufacturing sector, which expanded by
10.9%, one of the best results in 15 years, said Hren.
Meanwhile, growth of domestic consumption remained flat at 3%, with household
consumption up 3.4%.
Hren said the favourable economic situation was reflected in the highest rate of
employment in Slovenia ever, with the number of persons in employment rising 2.4%
to 936,000. The biggest growth was registered in construction, where the number of
employed grew by nearly 10%.
INTERNATIONAL COOPERATION
Slovenia's Planned Rail Investment Half of Austria's
Long-term investment in rail infrastructure and redirecting cargo transport to
railroads topped the agenda as Austrian Minister of Transport, Innovation and
Technology Werner Faymann held talks with Slovenian counterpart Janez Bozic
Long-term investment in rail infrastructure and redirecting cargo transport to railroads
topped the agenda as Austrian Minister of Transport, Innovation and Technology
Werner Faymann held talks on Monday, 4 June with Slovenian counterpart Janez
Bozic.
Austria will spend EUR 20bn on rail infrastructure until 2020, which is twice as much
as Slovenia plans to spend until 2023, Faymann told the press.
Bozic said the amount of money Austria intends to allocate for upgrading the rail
network showed that a transport policy, which aims to redirect cargo transport onto
rails, was feasible.
According to Faymann, this also raises the issue of road tolls for lorries; if tolls
increased, it would be easier to shift more cargo transport onto railroads.
The ministers discussed specific rail projects, with Faymann saying that the link
between the city of Maribor (NE) and the border crossing Sentilj/Spielfeld was of
particular importance to Austria.
Bozic said that the project was one of the priorities in the railroad modernisation
programme, but for Slovenia upgrading the route from Ljubljana to Jesenice (N) and
on to Austria's Klagenfurt was also important.
Faymann said that the upgrade of the northern route, which links Austria with the
Slovenian Port of Koper, was not competing with the routes, which head east.
The Port of Koper is crucial, as it is the second most important cargo port for Austria
after Rotterdam, he said.
Economy Minister Discusses Cooperation With UNIDO
Economy Minister Andrej Vizjak met Kandeh Yumkella, director general of the UN
Industrial Development Organisation (UNIDO)
Economy Minister Andrej Vizjak met on Monday, 4 June Kandeh Yumkella, director
general of the UN Industrial Development Organisation (UNIDO), to discuss further
participation of Slovenian companies in UNIDO projects and the organisation's
cooperation with Slovenia during the country's spell as EU president in 2008.
By funding projects in Serbia, Montenegro, and Ukraine in the last two years,
Slovenia has become the largest funder of the organisation among the EU newcomers.
As EU president, Slovenia will be even more actively involved in UNIDO projects,
the Economy Ministry said in a press release.
UNIDO has had the status of a specialised UN agency for industrial development
since 1986. The organisation, which has 171 members, wants to ensure sustainable
industrial development and reduce poverty in the world by increasing productivity
and boosting economic growth.
Parliament Speakers Agree Norway, Slovenia Should Boost Cooperation
Parliament Speaker France Cukjati met his counterpart Thorbjoern Jagland
Parliament Speaker France Cukjati, who was on a three-day official visit to Norway,
met on Tuesday, 5 June his counterpart Thorbjoern Jagland. The pair agreed that
bilateral relations were good, but both countries wish to strengthen economic
cooperation.
Jagland said that between 2004 and 2009 Norway, a member of the European
Economic Area, gave Slovenia EUR 12.5m from the fund for bridging the social gap
following EU enlargement.
He added that the number of Norwegian tourists in Slovenia has already increased,
while more and more Slovenians studied in Norway.
Cukjati said that Europe lacked Norwegian mentality and that he hoped that Norway
would join the EU as soon as possible. Jagland meanwhile said that Norway was not a
member of the EU, but it was closely linked with the bloc.
He said that the Norwegian parliamentary parties supported the EU accession,
because in his opinion EU membership was good for safe environment and ensuring
peace. He wishes that Norway would participate in decision-making in the EU, and he
also supports the enlargement to the Balkans and later to Turkey.
According to Jagland, the Norwegian parliament strove for more cooperation with
parliaments of other countries, because transposition of European legislation was a
condition for entering the European Economic Area, and because EU parliaments
were gaining more power.
Cukjati also touched on Slovenian EU presidency in the first half of 2008, explaining
that a number of issues that are interesting for Norway would be on the agenda,
including intercultural dialogue, EU enlargement, constitutional treaty and the
Western Balkans.
Macedonia and Slovenia for EU Expansion to Western Balkans
Rupel pointed to Macedonia as the first in the line after Croatia, saying it could get a
date for EU talks during Slovenia's presidency
Macedonian Foreign Minister Antonio Milososki and his counterpart Dimitrij Rupel
praised bilateral relations and voiced common interest in the EU's expansion to the
Western Balkans as they addressed a joint press conference following the talks in
Ljubljana on Wednesday, 6 June. Rupel pointed to Macedonia as the first in the line
after Croatia, saying it could get a date for EU talks during Slovenia's presidency.
"Macedonia's prospect depends on the EU and NATO. We believe the time of
accession is getting irrepressibly closer. Slovenia would like to be among those
friends who support and advance this," Rupel said, reminding reporters of Slovenia's
support for Macedonia in its aspirations so far.
He reiterated that "there is a possibility for Macedonia to start negotiations with the
EU during Slovenia's presidency", in the first half of 2008, while he added that much
would have to be done ahead of this.
Milososki said that the launch of talks was a major challenge for Macedonia and that
the country would try to convince the EU with concrete results that it was fit for this
step. Macedonia has the status of a candidate country since December 2005, while it
still has not got the date of accession negotiations.
Bajuk Promotes Slovenia as Investment-Friendly Country
Finance Minister Andrej Bajuk presented Slovenia's economy to some 40 potential
investors from France in Paris
Finance Minister Andrej Bajuk presented Slovenia's economy to some 40 potential
investors from France in Paris on Wednesday, 6 June, saying that the country had
achieved the level of "normality of the old EU members", and most importantly, was
no longer unknown and was subject to the same rules as other euro area EU countries.
Bajuk, presenting Slovenia's economic situation and opportunities offered by the
Slovenian market at the Agency for the International Promotion of French
Technology and Trade, called on investors to talk to their colleagues who are already
present in Slovenia. "It is a really friendly environment."
One of the miracles of Slovenia is that it broke off with the past and entered the
eurozone as soon as possible. There are no signs of serious macroeconomic risks,
Bajuk told French business executives.
According to the minister, the five biggest exporters generate some 20% of the
Slovenian total exports, while the rest of the exports are made by small and micro
companies. Since companies do many different things, the economy is very resistant
to shocks, he added.
He explained that in 2005 Slovenia's GDP per capita amounted to 82% of the EU25
GDP. The unemployment rate currently stands at 5.8%, the country's public debt is
relatively low, fiscal policy is healthy, there are no major pressures on inflation,
however the state is facing some key projects, he said.
Bajuk also presented some reforms that the government had initiated, including
legislative changes referring to investment and income tax, and labour market reform.
Dominique Lapierre, business attache at the French embassy in Ljubljana, meanwhile
said Slovenia was a developed country, lying at the crossroads between Western and
Eastern Europe, which was important from the logistics point of view.
France is the fourth largest direct investor in Slovenia, with a 9% share, Jan Stanovnik
of the Public Agency for Entrepreneurship and Foreign Investments told some 40
potential investors. According to him, most attractive sectors for investments were
logistics and distribution centres and tourism.
Slovenian, Croatian Railway Operators to Boost Cooperation
The heads of Slovenian and Croatian national railway operators agreed on
simplifying customs procedures and the introduction of interoperable railway engines
to speed up transport
The heads of Slovenian and Croatian national railway operators agreed on simplifying
customs procedures and the introduction of interoperable railway engines to speed up
transport as they met in the south-eastern town of Podcetrtek on Tuesday, 5 June.
According to Peter Puhan, the general manager of Slovenske zeleznice, the company
would like to boost economic and technical cooperation with the Croatian railway
operator, Slovenske zeleznice said in a press release on Wednesday, 6 June.
The goal is to enable faster cargo and passenger transport by introducing interoperable
railway engines, simplifying customs procedures, and improving communication
between the two companies, he said.
The international cargo transport of Slovenske zeleznice amounts to over two million
tonnes, 8.99% of which is destined to Croatia.
In international passenger transport, this neighbouring country is the number one
destination, accounting for 39.72% of the international passengers, he said.
Davorin Kobak, chairman of Hrvatske zeljeznice, said the Croatian rail operator's goal
was to reduce by one day the travel time of containers on the Koper-Zagreb-Koper
route and cut the costs of transport by introducing interoperable engines.
Hrvatske zeljeznice is to introduce a new first-class passenger train between Belgrade
and Ljubljana, Kobak said, and added the simplification of customs procedures at one
of the border crossings had already shown results.
To meet the demand of passenger transport from Croatia to Western Europe, the
company plans to purchase 24 new carriages that will be able to go as fast as 240
km/h, Kobak said.
Parliament Speaker Discusses EU, NATO with Norwegian MPs
Slovenian Parliament Speaker France Cukjati met members of the Norwegian
Standing Committee on Foreign Affairs in Oslo
Slovenian Parliament Speaker France Cukjati met members of the Norwegian
Standing Committee on Foreign Affairs in Oslo on Wednesday, 6 June to discuss
Norway's cooperation with the EU and NATO in peacekeeping missions.
Cukjati, on the second day of his three-day visit to Norway, told STA after the
meeting that the two countries had very similar standpoints.
The only difference is Norway's intensive participation in peacekeeping missions, its
priority being the NATO-led missions in Afghanistan, Iraq, Sudan and several other
locations in Africa.
Cukjati believes it is essential the EU peacekeeping forces stay in the Western
Balkans, primarily Bosnia-Herzegovina and Kosovo.
Although Norway is not expected to take part in the EU Balkans missions, it will
continue to provide financial support for the demining project in Balkans led by
Slovenia, he said.
Parliament Speaker and Norwegian FM Discuss Kosovo, Middle East
Slovenian Parliament Speaker France Cukjati discussed the future of Kosovo, the
crisis in the Middle East and economic cooperation between Slovenia and Norway
with Foreign Minister Jonas Gahr Stoere as he wrapped up a three-day visit to the
country
Slovenian Parliament Speaker France Cukjati discussed on Thursday, 7 June the
future of Kosovo, the crisis in the Middle East and economic cooperation between
Slovenia and Norway with Foreign Minister Jonas Gahr Stoere as he wrapped up a
three-day visit to the country.
The officials said that both Slovenia and Norway supported the plan on the future
status of Kosovo put forward by UN special envoy Martti Ahtisaari. Stoere said that
Ahtisaari's plan was the best one presented so far.
Talks also revolved around the crisis in the Middle East, with the Slovenian
delegation inquiring whether Norway would launch a new peacekeeping initiative,
after it had already helped conclude two Middle East agreements in Oslo.
Stoere said that the circumstances in the Middle East were very dramatic, while
Norway preferred the issue to be resolved by the involved parties by means of
diplomacy. He added that Norway would intervene if necessary, a source in the
Slovenian delegation told STA.
Stoere was also quoted as having expressed Norway's interest in enhancing economic
cooperation with Slovenia, adding that the countries and their companies first had to
get to know each other well.
The Slovenian delegation, which also included the chairs of the parliamentary foreign
policy and economy committees, Jozef Jerovsek and Feri Horvat, and the head of the
parliamentary friendship group with Norway, Srecko Prijatelj, already held talks with
Parliament Speaker Thorbjoern Jagland and attended a session of the Norwegian
parliament.
EUROPEAN UNION
PM Says Broad Consensus Key to Successful Euro Changeover
The changeover to the single European currency would not have been successful if we
did not reach a broad consensus on the necessary measures, Jansa told a conference
on Slovakia's impending euro changeover
Prime Minister Janez Jansa told an euro conference in Bratislava on Monday, 4 June
that broad consensus was a key element in the successful adoption of the euro in
Slovenia.
The changeover to the single European currency would not have been successful if we
did not reach a broad consensus on the necessary measures, Jansa told a conference
on Slovakia's impending euro changeover.
People were well aware of the advantages of the euro: not only easier travel in
eurozone countries, but also greater competitiveness and international reputation for
the country, said Jansa.
Slovakian Prime Minister Robert Fico meanwhile said his country intended to fulfil
the Maastricht criteria for eurozone entry in order to join the club by 2009.
Brussels: Notaries Only Serious EU Law Infringement Case vs. Slovenia
Slovenia is currently not subject to any serious procedure over the infringement of the
European legislation, according to a European Commission spokesperson, the only
exception concerning the notary service, the cause of Brussels' rebuke to several
other EU states
Slovenia is currently not subject to any serious procedure over the infringement of the
European legislation, according to a European Commission spokesperson, the only
exception concerning the notary service, the cause of Brussels' rebuke to several other
EU states.
Slovenia has earned some warnings from the European Commission over its failure to
notify Brussels on the transposition of EU laws into its national legislation and
possible incompatibility between the Slovenian and European legislation.
However, in a more serious action, Slovenia, along with several other EU countries,
received a formal notice from the Commission last October to submit an explanation
regarding the legislation that allows only Slovenian nationals to become notaries.
The European Commission believes that the stipulation in the Slovenian legislation
which sets Slovenian citizenship as a condition to perform the job of a notary runs
contrary to the EU rules on freedom of establishment.
Over the same issue, the Commission issued formal requests to modify legislation to
Austria, Belgium, France, Greece, Luxembourg, Germany, Portugal and the
Netherlands, which is the second stage of the infringement procedure, while it called
on all newcomers with the exception of Cyprus, to submit their observations on
similar legislation, the first stage of the infringement procedure.
All the countries in question have already submitted answers to Brussels, something
that will serve the Commission as a basis to decide whether to continue or halt
procedure against each individual state. The first possible date for debating the case is
at the end of this month, while it remains open whether Slovenia's case will be on the
agenda then.
Slovenia has so far transposed 99.2% of the European legislation into its national
legislation, which places it 10th among the 27 member states, according to the
Commission. Slovenia ranks sixth among the newcomers, which means it has fallen
behind half of the 12 new arrivals to the bloc.
Slovenia has received warnings over different issues, including the environment,
pharmaceutical industry, health, gaming and in several cases for differentiating
between Slovenian and other subjects, such as in the case of tax deduction on
investment.
Slovenian, Swedish PMs Call for Compromise on EU Constitution
Slovenian Prime Minister Janez Jansa met his Swedish counterpart Fredrik Reinfeldt
Slovenian Prime Minister Janez Jansa said after talks with his Swedish counterpart
Fredrik Reinfeldt on Tuesday, 5 June that both countries supported the German EU
presidency in its efforts to find a compromise for the EU constitution.
"Slovenia in particular hopes that the solution will be found this month," Jansa told
the press, referring to the EU summit in June.
Even though Sweden has not ratified the treaty and Slovenia has, the document has
been signed and it enjoys strong support in parliament, Reinfeldt said.
According to Reinfeldt, Sweden supports the German EU presidency in its efforts to
downsize the treaty and take away provisions that make people feel that a "superstate" is being created.
However, Sweden wants to preserve the essence of the existing treaty.
Turk: People and Environment Key to Slovenia's Lisbon Vision
Slovenia will help shape Europe's global role in the future, drafting key documents of
the Lisbon Strategy and paying attention to people and environment, Development
Minister Ziga Turk said after his first visit to Brussels as the national coordinator for
the implementation of the Lisbon Strategy
Slovenia will help shape Europe's global role in the future, drafting key documents of
the Lisbon Strategy and paying attention to people and environment, Development
Minister Ziga Turk said on Tuesday, 5 June after his first visit to Brussels as the
national coordinator for the implementation of the Lisbon Strategy.
Slovenia has a unique opportunity to contribute its own thinking to the vision of
future Europe, said Turk, adding that its vision during the EU presidency in 2008
would stress care for people and the environment.
Slovenia and Portugal will shape the new three-year period of the Lisbon Strategy
side by side, said Turk. Under Portugal's presidency, most of the strategic guidelines
will be drafted, while Slovenia will take charge of wrapping up the final key
documents.
"The Lisbon Strategy is a plan to modernise Europe," said Turk. "I think Europe
admitted that sheer competition with the US and Asia is not what Europeans are
interested in. They are interested in the European quality of life, which has always
existed."
In Slovenia, the debate around the strategy is only beginning. Slovenia will take a
concrete standpoint on Lisbon by September, when all national coordinators meet in
Brussels to draft the basis for the upcoming three-year period, he explained.
EU member states appoint national Lisbon coordinators based on the decision of the
2005 EU summit at which they made the commitment to improve internal
coordination in the implementation of the Lisbon Strategy.
Turk was appointed Slovenian national Lisbon coordinator, or Mr. Lisbon, in the
beginning of April, replacing Janez Sustersic, the head of the Institute for
Macroeconomic Analysis and Development, who was the national coordinator from
September 2005.
Slovenia Seeking to Extend EU Roaming Charge Cap to Croatia
Slovenia called on the European Commission to extend the new rules that cut the
costs of cross-border mobile calls to candidate countries, including Croatia and
Turkey
Slovenia on Thursday, 7 June called on the European Commission to extend the new
rules that cut the costs of cross-border mobile calls to candidate countries, including
Croatia and Turkey.
"Roaming should be one of the priority fields that candidate countries must transpose
into their legislation as they implement the EU body of law," said Economy Minister
Andrej Vizjak.
Vizjak was speaking to the press after EU ministers in charge of telecommunications
backed rules that slash roaming costs by up to 70%, removing the last hurdle to
implementation.
"It is in Slovenia's interest that this matter be arranged with candidate countries as
soon as possible," Vizjak said, adding that the Commission should "not be too
acquiescent".
The reason the price of calls from Croatia is crucial is that the neighbouring country is
the no.1 summer holiday destination for Slovenians.
Finnish Ex-FM: Smaller Members More Successful at EU Presidency
Chair of the Finnish parliament's Grand Committee Erkki Tuomioja met Foreign
Minister Dimitrij Rupel to share Finland's experience of presiding over the EU
Chair of the Finnish parliament's Grand Committee Erkki Tuomioja met Foreign
Minister Dimitrij Rupel in Ljubljana on Thursday, 7 June to share Finland's
experience of presiding over the EU. Tuomioja said he was sure Slovenia would
continue the tradition of small countries performing better than their bigger
counterparts.
Tuomioja, who served as foreign minister during Finland's EU presidency, explained
that "smaller countries generally consider the presidency as a national project", while
bigger countries lose a part of their efficiency because of their complex organisation.
In Finland, the presidency was supported by the general public and the political
parties, so the country could focus on its presidency and put other issues aside, he
said.
The secret to successful presidency lies in the commitment, leadership abilities and
transparent work. "Be prepared for everything," Tuomioja said, adding that the EU
presidency presents each country with unpredictable events.
Finland's initial presidency budget was EUR 42m, but in the end, costs amounted to
EUR 75m. Most of the additional costs were generated by unanticipated events and
high costs of security measures, he said.
Slovenia meanwhile plans to earmark EUR 57m for its spell in the first half of 2008.
EU Fails to Agree on Postal Service Liberalisation Date
The agreement could be reached during Slovenia's stint as EU president, Economy
Minister Andrej Vizjak said after the ministerial
The EU ministers in charge of telecommunications failed in Luxembourg on
Thursday, 7 June to set the date for the liberalisation of postal services in the EU. The
agreement could be reached during Slovenia's stint as EU president, Economy
Minister Andrej Vizjak said after the ministerial.
According to the minister, Slovenia favours liberalisation, however, the agreement
cannot be expected before next year. Nevertheless, progress was achieved and now it
is not a matter of if but of "how and when", said Vizjak.
Unofficially, Portugal is to present a new proposal for the solution of the issue
immediately after it takes over as EU president in the second half of 2007.
The European Commission last October proposed full liberalisation of the postal
service market by 2009. According to the proposal, national operators will not be able
to exercise their right to reserved areas and shipments weighing over 50 grams which
present the bulk of postal services.
The Commission stressed that the operators would still have to provide quality
universal service, meaning one delivery and five collections a week for all EU
citizens.
The postal service market in the EU has been progressively liberalised since 1997 and
is currently opened for all shipments weighing over 50 grams.
Lenarcic: Preparations for EU Presidency According to Plan
Presenting the report on the progress made between last November and April this
year, Lenarcic explained that the preparations have entered the final phase and that
the focus is shifting to the subject matter of the presidency
The parliamentary EU Affairs Committee discussed on Friday, 8 June a report on
progress in the preparations for EU presidency, with EU Affairs State Secretary Janez
Lenarcic assuring that Slovenia is well on track to being completely ready for the
task.
Presenting the report on the progress made between last November and April this
year, Lenarcic explained that the preparations have entered the final phase and that the
focus is shifting to the subject matter of the presidency.
However, he added that the main topics of the Slovenian presidency will largely
depend on the legacy of the German and Portuguese stints.
Lenarcic meanwhile explained that a reevaluation of the presidency budget is
underway, coming foremost as a result of the increase from eight to ten in the number
of meetings planned in Slovenia. The new estimate will be known sometime next
month, with the increase expected to stand at 10% in relation to the current EUR 57m.
Arguing that the presidency need not be seen as brining only expenses, he pointed out
that Austria for instance had managed to outweigh the costs of its presidency through
the hotel industry and other services.
According to Lenarcic, the setting up of the presidency web site is well on track,
however the page will only be unveiled a month before Slovenia takes over as has
become tradition with former presiding countries.
Slovenia Calls for Equality in Managing EU Sat-Nav System
Slovenia wants an "equal and all-round participation of member states in the process
of building and utilisation of Galileo," Verlic told the press
Transport Ministry State Secretary Peter Verlic stressed on Friday, 8 June the need for
equality in managing the Galileo satellite navigation system as he attended a meeting
of the EU Transport, Telecommunications and Energy Council in Luxembourg aimed
at discussing the future of the project.
Slovenia wants an "equal and all-round participation of member states in the process
of building and utilisation of Galileo," Verlic told the press.
Managing the projects is, next to the question of financing, the key issue the bloc will
have to tackle in the autumn if it wants keep the project the cost of which is estimated
at between EUR 3.4bn and EUR 3.6bn.
A bigger level of equality could best be reached if the European Commission
managed the project, as ESA incorporates only 15 member states, and Slovenia is not
one of them, Verlic said.
However, Slovenia signed a memorandum of understanding with ESA in April. The
memorandum is expected to make Slovenia an ESA participating country in a matter
of years and improve its chances of being selected to host the seat of the Galileo
supervisory authority.
Although the location of the seat is currently not on the agenda due to the problems of
funding, "Slovenian candidacy is still alive", Verlic said.
Verlic also said some services Galileo will offer would be "of distinct importance for
the public interest".
Over 1,300 Civil Servants Preparing for EU Presidency
Slovenia is training over 1,300 civil servants for its spell as EU president in the first
half of 2008, one of the biggest undertakings for the country since it became EU
member in May 2004
Slovenia is training over 1,300 civil servants for its spell as EU president in the first
half of 2008, one of the biggest undertakings for the country since it became EU
member in May 2004.
According to the latest report on the EU presidency preparations, adopted by the
government in May, the presidency will be the task of a total of 1,344 civil servants,
with 170 of them being posted in Brussels.
However, even that number will not suffice for the country to carry out all of the
presidency's tasks, also because Slovenia lacks qualified personnel for certain fields.
This has resulted in Slovenia deciding to hand over the working group for products to
France, while Portugal will be put in charge of desertification.
The cabinet moreover decided to hire experts from Slovenian faculties and institutes,
as well as from abroad. The expected number is 45 from Slovenia and 25 from
abroad, while the final number has not yet been determined.
The experts and other officials will also meet in the country during its spell between 1
January and 30 June 2008. The country expects to host ten informal ministerials and
over 150 meetings on the sub-ministerial level.
Slovenia's stint is also to include a number of meetings between the EU and other
countries, including an EU-US summit. The majority of meetings will be held at Brdo
pri Kranju, near Ljubljana, where a new conference centre is under construction.
According to the report, the biggest challenge will be interpreting. Slovenia at the
time has 140 potential interpretors, but is looking for additional ones, especially for
interpreting from English to French and vice versa.
STATISTICS/FORECASTS
Ljubljana Attracting More and More Visitors
According to statistics released by the Ljubljana Tourist Board, tourist info points in
Ljubljana recorded 69,079 visitors in the first five months of the year, up 33% yearon-year
Slovenia's capital is attracting a growing number of visitors from the country and
abroad. According to statistics released by the Ljubljana Tourist Board on
Wednesday, 6 June, tourist info points in Ljubljana recorded 69,079 visitors in the
first five months of the year, up 33% year-on-year.
In May alone the number of visitors stood at 20,288, which is up 41% over the same
month last year. Growing visitor numbers are also evident from orders for guided
tours. The number of groups seeking such services went up by 6% year-on-year in
January-May period, while it stood at 599 in May alone.
Ljubljana hotels are happy with their bookings as well. They recorded 58,528
overnight stays in May, which is up 5.1% on May 2006, while the number for the first
five months of the year went up by 11.3% to 210,822.
Imports Surge by 27% Year-on-Year
The export-import ratio for April was at 91%
Slovenia's exports rose by 17.6% to EUR 1.54bn in the year to April, while imports
surged by 27.2% to EUR 1.69bn. The export-import ratio for April was at 91%, down
from 95.8% in March, according to preliminary data from the Statistics Office.
As much as 70.3% of the country's exports went to EU member states (EUR 1.08bn),
while the value of imports from EU members stood at EUR 1.32bn, representing
78.2% of total imports.
Data from the Statistics Office also shows that exports in the first four months of the
year amounted to EUR 6.25bn, which is up 18.2% over the same period last year,
while imports went up by 19.6% to EUR 6.71bn.
The trade gap amounted to EUR 456.7m, while exports represented 93.2% of imports.
Industrial Output Down 7.8% over March, Up 13.1% Y/Y
Compared to March, production decreased in manufacturing by 7.9%, in mining and
quarrying by 3.3% and in electricity, gas and water supply by 9.2%
Industrial output fell by 7.8% in April over March, while it increased by 13.1% yearon-year, the national Statistics Office said on Friday, 8 June. According to the
indicator that also takes into account the number of working days, industrial output
rose by 10.1%.
Compared to March, production decreased in manufacturing by 7.9%, in mining and
quarrying by 3.3% and in electricity, gas and water supply by 9.2%.
In comparison with April 2006, the output increased in manufacturing (+14.5%) and
in mining and quarrying (+24.8%), but fell in electricity, gas and water supply (by
10.9%).
Looking at the three main industrial groupings, the output of capital goods went up by
12.4%, while the volume of production of intermediate goods rose by 8.6%, and that
of consumer goods by 3.8% compared to March.
Moreover, stocks increased by 1.6% at the monthly level and by 8.8% over April
2006.
In the first quarter of 2007 industrial productivity was 8.3% higher than in the same
period 2006.
FINANCE
Vizjak: Regulating Venture Capital Means More Competitiveness
Vizjak was confident that the legislation would help companies boost innovation and
make them more competitive
Economy Minister Andrej Vizjak told the press on Monday, 4 June that the bill on
venture capital firms, adopted by the government the previous week, was aimed at
providing better conditions for rather risky business ventures in order to boost
competitiveness.
Vizjak was confident that the legislation would help companies boost innovation and
make them more competitive. He added that the bill was prompted by the fact that the
European and Slovenian economy had been assessed as not competitive enough.
According to Vizjak, the main objective of the bill is to define venture capital and
terms related to equity funding of companies. Venture capital is a very important
financial source for small and medium-sized companies, which constitute a
predominant part of the Slovenian economy, said Vizjak.
The bill also legally defines venture capital firms, giving them the legal and
organisational framework for investing venture capital in companies, added Vizjak.
According to him, venture capital can be invested as a share capital increase or
through establishing new companies. Vizjak believes that the provisions should be
clearly defined in order to prevent them being abused.
Investors should moreover be encouraged to invest in venture capital firms, said
Vizjak. The minister believes that an encouragement for this was provided by recent
changes to the corporate income tax act and personal income tax act, which made
profits from such investments non-taxable.
The bill also sets certain restrictions, such as setting the threshold for investing in a
venture capital firm at EUR 50,000. The firm has to invest at least 50% of funds in
small- and medium-sized companies after the first year of operation, said Vizjak.
Additional 30% has to be earmarked for private equity capital investment or for loans
to companies into which the firm already invested, he added.
When the bill is passed, expectedly in September, the state could establish a venture
capital fund as part of Slovenian Enterprise Fund, which will be funded from the EU
fund for regional development, said Vizjak.
According to the director of the Slovenian fund, Boris Pfeifer, the fund has already
established an asset management company, while it is also to establish a public
company with EUR 36m allocated for co-financing.
Vizjak meanwhile said that such a public company would be an important financial
contributor for venture capital firms, which are expected to flock to the Slovenian
market due to favourable taxes.
Triglav Acquires Leading Macedonian Insurer
Slovenia's biggest insurance company, Zavarovalnica Triglav, signed a contract on
the purchase of Vardar Osiguranje, a leading Macedonian insurer
Slovenia's biggest insurance company, Zavarovalnica Triglav, signed a contract on
the purchase of Vardar Osiguranje, a leading Macedonian insurer, in Belgrade on
Monday, 4 June. While Triglav did not reveal how much it paid for the deal, it said
the company was now present in eight markets, holding the leading position in three.
According to a press release from the Slovenian insurer, the contract was signed by
Triglav chairman Andrej Kocic, its chief supervisor Damjan Mihevc and Vardar
Osiguranje general manager Stojan Klopcevski. The press release also says that
Triglav is now the market leader in Slovenia, Montenegro and Macedonia.
Triglav management signed a letter of intent on strategic partnership with Vardar in
November 2006. Focusing on car insurance, the Macedonian company commanded a
27% market share at the end of 2006. Its 156 employees generated EUR 25m in
premiums and EUR 1.49m in profit.
Some time ago Vardar had been eyed by Croatian insurer Croatia Osiguranje and
Italian group Generali. According to media reports, the two companies were prepared
to pay between EUR 30m and EUR 50m for Vardar.
The Croatian company and Vardar have established a joint venture Vardar Croatia, in
which Croatia Osiguranje holds a 70% stake. This is the only life insurance company
in Macedonia.
The gross combined value of premiums generated by all ten insurance companies
operating in Macedonia stood at EUR 92.45m at the end of last year.
Finance Minister Cautious about Fate of Lower Housing VAT
Slovenia wants to keep the value added tax (VAT) rate on construction, renovation
and maintenance work for residential housing at the reduced 8.5% after the
transitional period it obtained from the European Commission runs out in December
Finance Minister Andrej Bajuk was adamant on Tuesday, 5 June that Slovenia would
not allow VAT for housing to increase after 1 January 2008, however he added that
the fate of the Slovenian proposal to keep the VAT at a lower rate remained unclear.
Slovenia wants to keep the value added tax (VAT) rate on construction, renovation
and maintenance work for residential housing at the reduced 8.5% after the
transitional period it obtained from the European Commission runs out in December.
Slovenia sent its proposal to that effect to the Commission in April.
"Once the question is answered, we will move on. It is possible that exceptions will be
granted but I would not like to openly state what could happen," Bajuk told the press
at the sidelines of a meeting of EU finance ministers.
The Commission said in April that the higher VAT rate should be used. The lower
one would only be applicable for welfare housing. Bajuk said that a unified
categorisation of welfare flats did not exist.
IMAD: ECB Rate Rise Reflects Fear of Overheating
A senior member of the Institute for Macroeconomic Analysis and Development
(IMAD), a government think-tank, believes that the European Central Bank's decision
to raise the benchmark interest rate is designed to prevent the economy from
overheating
A senior member of the Institute for Macroeconomic Analysis and Development
(IMAD), a government think-tank, believes that the European Central Bank's decision
to raise the benchmark interest rate is designed to prevent the economy from
overheating. Inflation cannot be the reason, as it is stable, Bostjan Vasle said on
Wednesday, 6 June.
Vasle told the press that growth in the EU has been stronger than expected in the first
quarter of the year, one of the reasons being that the recent hike in the value added tax
(VAT) in Germany did not have an adverse impact on industry or household
consumption.
Despite the rise, interest rates in Slovenia will remain lower that they were in the past,
as they decreased sharply during the time Slovenia spent in the ERM II, the euro
waiting room, Vasle said.
The ECB decided to raise its benchmark rate by a quarter point to 4%, the highest
level since September 2001. The decision was taken at the monthly meeting of the
policy-setting board in Frankfurt.
Pension Fund Enters Ukrainian Market
Slovenian pension fund manager Prva pokojninska druzba has acquired the licence to
offer pension insurance in Ukraine
Slovenian pension fund manager Prva pokojninska druzba has acquired the licence to
offer pension insurance in Ukraine. Its Ukrainian fund, Druga penzija, is expected to
have 25,000 accounts and EUR 750,000 in assets under management by the end of the
year, the company said on Thursday, 7 June.
The company opened its Ukrainian subsidiary, Administrator NPF Pension Standard,
at the beginning of this year. It plans to offer pension insurance in particular in big
and medium-sized companies and become one of the market leaders.
Experts Call for Rise in Retirement Age
Financial experts debated the need for a reform of the pension system, agreeing that
the retirement age should be raised to tackle the ageing of the population.
Furthermore, extensive reforms of state expenditures for pensions and health care are
needed to prevent public finances from collapsing
Financial experts debated the need for a reform of the pension system at Bled on
Thursday, 7 June, agreeing that the retirement age should be raised to tackle the
ageing of the population. Furthermore, extensive reforms of state expenditures for
pensions and health care are needed to prevent public finances from collapsing.
According to Robert Holzmann of the World Bank, the ways to address the problem
of pensions are well known if limited in scope, but they require parallel reforms of the
labour and financial markets.
Holzmann believes that if the retirement age is not upped, some 80% of Europe's
population will be too young or too old to work.
He added that labour market reforms were needed to provide measures to encourage
the elderly to continue working and companies to keep them employed.
Financial reforms must meanwhile increase the profitability of retirement funds, he
added.
The over 100 participants of the three-day event were addressed by Finance Minister
Andrej Bajuk, who stressed the need for consistency in reforms which are required
due to the ageing population and low birth rate.
These reforms must guarantee stability, so they must be an ongoing process of
adaptation to demographic change, he said.
According to Bajuk, the success of the reform also requires inter-generational
consensus.
President Nominates Kranjec as Central Bank Governor
President Janez Drnovsek officially proposed to parliament to appoint economist
Marko Kranjec governor of the central bank
President Janez Drnovsek on Friday, 8 June officially proposed to parliament to
appoint economist Marko Kranjec governor of the central bank. According to
Drnovsek, Kranjec, a former vice-governor of Banka Slovenije, is a top expert and an
authority on finance and banking.
The proposal comes after Kranjec won endorsement of all factions in parliament
following their consultations with Drnovsek last week.
Kranjec has long-term experience and the personality required for the successful
governance of Banka Slovenije and its representation at the European Central Bank,
Drnovsek says in the proposal to parliament as quoted by his office.
Drnovsek adds that the search for a candidate for the post at the helm of the central
bank has been made difficult after two of his previous nominees failed to get support
in parliament despite their excellent references.
The support for Kranjec came only after Drnovsek decided to yield to the pressure of
the deputy groups and start consulting them about the nomination, which he had
previously refused on the ground that it had proved to be unproductive in the past.
The central bank has been without a governor since April, when Mitja Gaspari's term
ran out. Gaspari was Drnovsek's first pick for the post, but he was voted down in
parliament.
Andrej Rant, a member of the Governing Board, suffered the same fate. Drnovsek's
next picks were Velimir Bole, Mojmir Mrak and Dusan Mramor, but they all rejected
the offer.
Kranjec was born in 1940 and had a stint as a macroeconomist at the Organisation for
Economic Cooperation and Development in Paris between 1976 and 1978. He worked
at the World Bank in Washington between 1894 and 1986.
He was the finance minister in the first post-communist Slovenian government (19901991), before becoming the vice-governor of the central bank, a post he held until
1997.
He then went on to become Slovenia's ambassador to the EU. Since 2002 Kranjec
teaches public finance at the Ljubljana Faculty of Administration. He is also a
member of the Strategic Council for Economic Development, a government economic
policy think-tank.
Ljubljana Stock Exchange
A strong surge in demand for Slovenian blue chips pushed the main market SBI 20
index to 9,688.27 points
A strong surge in demand for Slovenian blue chips pushed the main market SBI 20
index to 9,688.27 points, up 222.92 (2.36%) on the week. The SBI TOP index of the
10 biggest blue chips gained 37.4 points (1.83%) to 2,082.39 points.
The week also saw a new all-time high of the SBI 20 and SBI TOP indices. The
former was at 9,740.89 points on Thursday, 7 June, and the latter reached its peak on
the same day with 2,097.09 points, before profit taking set in on Friday, 8 June.
Logistics group Intereuropa was the most interesting blue chip this week. Buoyed by
rumours on a takeover, the item soared by 15.55% to EUR 48.40 on deals worth
nearly EUR 2m.
Other soaring items included airport manager Aerodrom Ljubljana (10.6% to EUR
99.53), chemical-through-tourism conglomerate Sava (6.2% 496.74), and port
operator Luka Koper (4.6% to EUR 94.23).
Pharma company Krka was meanwhile the most active item last week with EUR
2.74m coming in regular and EUR 10.12m in block trade. The item shed just over 1%
to EUR 902.02, one of the few blue chips to post a loss.
Household appliance maker Gorenje accounted for EUR 1.05m in regular deals,
adding 0.11% to EUR 36.11.
Brokers concluded a lacklustre EUR 17.45m of deals with additional EUR 46.86m
coming in block trade.
Trading on the free market was upbeat as well, pushing the PIX investment fund
index 28.4 points (0.45%) higher to 6,374.88.
The BIO bond index remained virtually still at 117.28 points.
REGIONAL INFORMATION
Ljubljana Landfill Turned into Golf Course
Slovenia's capital got its fist golf course
Slovenia's capital got its fist golf course on Tuesday, 5 June, as a nine-hole facility
opened in just off the Ljubljana ring road. The Trnovo golf course, worth EUR 1.7m,
stretches over 20 hectares of what used to be one of Ljubljana's landfills.
Trnovo is the first public golf course in Slovenia, which means that players do not
need to a membership card or have their playing skills tested. Moreover, prices are
considerably lower than in other golf centres in Slovenia.
According to the owner of the tenant of the course, Ales Babnik, the course took two
years to built. The whole course had to be covered with a 60-centimetre layer of clay.
On top of this came material excavated from the Sentvid tunnel, and a 20-centimetre
layer of soil.
Babnik expects the investment to be repaid in 10 to 12 years. According to him, the
project was modelled after similar projects abroad, where transformation of landfills
into parks or golf courses is a common practice.
BRANCH INFORMATION
Commissioner Praises Consumer Protection in Slovenia
European Commissioner for Consumers Meglena Kuneva said on Monday, 4 June
that consumer protection in Slovenia was very good, but people still relied too much
on the role of the state
European Commissioner for Consumers Meglena Kuneva said on Monday, 4 June
that consumer protection in Slovenia was very good, but people still relied too much
on the role of the state.
Only 1% of consumers are members of consumer protection organisations, whereas in
Portugal the figure is 10%, Kuneva told the press after talks with Economy Minister
Andrej Vizjak.
Kuneva was pleased with cooperation between the government and NGOs in
consumer protection, which was also highlighted by Vizjak.
Vizjak praised the role the Consumer Association of Slovenia played during the
transition to the euro, and noted that the directive on consumer credit would be on the
agenda of the Slovenian EU presidency next year.
Talks also touched on the full liberalisation of the electricity and gas markets for
households on 1 July.
Vizjak said that by creating two competing electricity providers, the government had
made sure liberalisation will be implemented in practice.
According to Kuneva, a high degree of consumer protection translates into higher
support for market liberalisation.
Kuneva stressed that the single European market must exist for companies as well as
individuals, which is possible only with effective consumer protection.
She said her department would focus on protecting the right of consumers in services
and online purchases.
Some 52% of Slovenians have made cross-border purchases; efficient consumer
protection at the European level is therefore in Slovenia's interest, she said.
Commissioner Says Consumer Protection Vital for Common Market
European Commissioner for Consumers Meglena Kuneva believes that consumer
protection policies need to penetrate all policies that influence the EU's single market
European Commissioner for Consumers Meglena Kuneva believes that consumer
protection policies need to penetrate all policies that influence the EU's single market.
Consumers are not merely passive observers who need to be protected but they also
co-shape the market, she said at a panel in Ljubljana on Monday, 4 June.
According to Kuneva, the future of the EU is not 27 different national consumers but
one European consumer with his or her rights and values.
She added that the Commission's Consumer Policy Strategy for the 2007-2013 period,
unveiled in early March, aimed at including services and the development of digital
and telecommunication technologies in consumer protection policies.
Measures to protect the consumer should moreover become a constituent part of
policies in the areas of energy, transport and telecommunications, among others,
Kuneva said at the panel on EU consumer strategy.
She pointed to the recent passing by the European Parliament of the regulation on
mobile roaming in the single market as an example of including consumers' interests.
She believes that coordinated rules for consumer protection on the EU level will also
bring more favourable measures for consumers in individual EU members.
Kuneva moreover praised the activities of the Slovenian Consumer Protection Office
and the European Consumer Centre in Slovenia, and called for productive cooperation
between Slovenia and her office during Slovenia's stint as EU president in the first
half of 2008.
Erjavec: Defence Tenders Opportunity for Slovenian Companies
Defence is one of those sectors where Slovenian companies can find opportunities for
growth, development and creation of new jobs, Defence Minister Karl Erjavec told a
conference, organised by the CCIS
Defence is one of those sectors where Slovenian companies can find opportunities for
growth, development and creation of new jobs, Defence Minister Karl Erjavec told a
conference on Wednesday, 6 June. The conference, sponsored by the Chamber of
Commerce and Industry, focuses on public procurement in defence.
According to NATO's defence policy, Slovenia is bound to allocate 2% of its GDP for
defence. This year, the defence budget amounted to EUR 560m, while next year it is
to stand at EUR 680m, explained Erjavec, adding that Slovenia would reach the 2%
goal in 2015.
Out of this year's funds, EUR 245m is earmarked for services and military equipment,
and this is where Slovenian companies can find their business, he said.
The military equipment budget is worth around EUR 105m, 20% of which involves
Slovenian companies, while 80% is reserved for counter supplies.
Slovenia's membership of NATO brought a great deal of changes, including the need
for new military equipment. However, few Slovenian companies produce the
equipment, so Slovenia has introduced a system of counter supplies, Erjavec
explained.
Nevertheless, the development of military technology is supported by the ministry.
This year, Slovenian companies will be able to bid for EUR 25m, Erjavec said.
Slovenians Abandoning Fixed-Line Calls
Slovenians concluded a total of 460 million of minutes of fixed-line calls in the first
three months of 2007, an 11% drop over the same period last year, according to the
National Statistics Office
Slovenians concluded a total of 460 million of minutes of fixed-line calls in the first
three months of 2007, an 11% drop over the same period last year, according to the
National Statistics Office.
According to statistical data, an average international call lasted for 3 minutes and 18
seconds, while a domestic calls were 2 minutes and 12 seconds long.
Just over a half of all calls (56%) were of a private nature and the rest were business
conversations. The share of business calls is higher for international calls with 53%.
Business conversations command a greater lead in calls from a fixed line to a mobile
phone with 63%.
Correspondingly, the number of Public Switched Telephone Network (PSTN) and
Integrated Services Digital Network (ISDN) phone lines dropped by over 1%
(10,000). They are being replaced by internet-based telephony.
Meanwhile, the 1,842,000 mobile phone users in Slovenia talked for 692 million
minutes in the first quarter, beating last year's result by 10%. Statistical data shows
that almost 70% of all mobile calls were private in nature.
The report also shows that the number of postal shipments increased slightly year-onyear. The amount of letters and packages sent within Slovenia was up by 0.7% and
the number of shipments from abroad rose by 2.2%.
COMPANIES
Plans for EUR 750m Mega Gaming Centre Unveiled
Slovenian gaming company Hit and US casino operator Harrah's Entertainment have
signed a deal on the construction of a EUR 750m entertainment and casino centre in
the Gorisko region in western Slovenia
Slovenian gaming company Hit and US casino operator Harrah's Entertainment have
signed a deal on the construction of a EUR 750m entertainment and casino centre in
the Gorisko region in western Slovenia, representatives of the two companies told the
press in Ljubljana on Tuesday, 5 June.
The centre will include top-class hotels with 1,500 rooms, a convention and events
centre, swimming pools, restaurants, a casino and numerous other facilities.
The location for the facility is still unclear, as is the exact date when it will open its
doors. According to the best-case scenario, it could open in three-years time, the
companies said.
Hit will own 51% of the joint venture and Harrah's the remaining 49%.
The project is conditional on changes to provisions restricting foreigners' ownership
of casinos and a reduction of the gaming tax.
Finance Ministry State Secretary Andrej Sircelj said that the ministry was already
amending the relevant legislation, which currently restricts foreigners to hold no more
than 20% in a gaming venture, whereas the effective tax rate on gaming is 38%.
According to Sircelj, the amendments will allow Harrah's to own 49% of the company
while the effective tax rate would drop to 17.5% on revenues that exceed EUR 303m.
The amendments will be sent to parliament in July and the National Assembly could
pass them before the year's end, Sircelj added.
Hit chairman Niko Trost said that the centre would create 3,200 new jobs directly and
another 1,000 indirectly.
The annual tax revenues are expected to amount to EUR 120m, while the centre will
spend EUR 165m a year for the goods and services it will require. This will have a
positive impact on the local economy, Trost added.
Moreover, the companies constructing the centre could earn between EUR 700m and
1bn.
Charles Atwood, vice chairman of Harrah's, said that the centre presented a big
opportunity for the US-based company. He believes that it could attract numerous
guests from all over Europe and the US.
The centre would be the largest greenfield investment ever in Slovenia.
The Economy Ministry welcomed the announcement. Marjan Hribar, the head of the
tourism directorate, said that the project could have a decisive impact on the
development of tourism in Slovenia.
"All of us who are trying to meet the goals of tourism policy can only hope for such
projects," Hribar told the press.
KD Holding Bids to Acquire Oldest Slovenian Department Store
According to a press release from KD Holding, the offer is open until 4 July
Investment firm KD Holding has published a takeover bid for Slovenia's oldest
department store on Wednesday, 6 June, offering EUR 27.5 per share or nearly EUR
16m for the 60% stake in NAMA it does not hold already.
According to a press release from KD Holding, the offer is open until 4 July. It refers
to 572,229 shares with a face value of EUR 4.17, or a 59.99% stake. The remaining
stake is already owned by the investment firm (40%) and two Ljubljana-based
companies PM & A FA and PM & A (0.01%).
Department store NAMA is listed on the Ljubljana Stock Exchange. When KD
Holding published the intent to acquire NAMA on 10 May, its average price per share
soared to EUR 26.
At the beginning of May, KD Holding acquired 391,648 NAMA shares from the
state-run Restitution Fund (SOD), and thus acquired a 40% stake in the company.
NAMA is the acronym for Narodni magazin (National Store). It was a chain of
department stores in the former Yugoslavia which opened the first department store in
Slovenia in 1946.
Today, NAMA still operates two stores in Slovenia - one in Ljubljana, and one in
Skofja Loka, a town some 30 km NW from Ljubljana.
Apart from Maximarket, NAMA is the only department store left in Ljubljana after
shoppers turned to malls which are mushrooming in the capital's suburbs.
Market Leader UPC Telemach Buys Rival Cable Operator
Cable operator UPC Telemach has consolidated its leading position on the market
with the acquisition of 66.7% of Ljubljanski kabel from London-based Regent Finance
Cable operator UPC Telemach has consolidated its leading position on the market
with the acquisition of 66.7% of Ljubljanski kabel from London-based Regent
Finance. The deal, which is worth EUR 10m according to business daily Finance,
takes its market share in Slovenia to over 40%.
The move is motivated by the desire to further consolidate the cable market and create
synergies. "We will be able to offer our subscribers better services, and investment in
new technologies will be more efficient," a statement by UPC Telemach on Thursday,
7 June said.
The acquisition will increase the number of UPC Telemach's cable subscribers by
28,000 to some 150,000. The number of internet subscribers will increase by 6,000 to
40,000, which represents 15% of the broadband market, the company told STA.
UPC Telemach, like Ljubljanski kabel based in Ljubljana, now dominates the cable
market in central Slovenia.
Asked whether any more acquisitions are in the pipeline, UPC Telemach said that its
strategy revolved around growing and consolidating the cable market in the country.
UPC Telemach is a subsidiary of Liberty Global Media, a US-based
telecommunications company with operations in 17 countries worldwide.
Pivovarna Lasko Fails in Bid to Acquire Serbian Brewer
The Serbian Privatisation Agency said that the competition for the stake in
Beogradska industrija piva (BIP) was won by a Swedish-Lithuanian consortium
Slovenian beverage group Pivovarna Lasko has failed in its bid to acquire 52% of a
Belgrade-based brewer. The Serbian Privatisation Agency said on Thursday, 7 June
that the competition for the stake in Beogradska industrija piva (BIP) was won by a
Swedish-Lithuanian consortium.
While United Nordic Beverges of Sweden and Alita of Lithuania offered EUR 4.5 per
share or a total of EUR 21.4m for the 51.9% stake in BIP, Pivovarna Lasko was
prepared to pay EUR 2.5 per share or EUR 11.8m for the stake.
The Slovenian group, whose flagship product is beer, was willing to invest another
EUR 9m, or twice as much as the selected consortium in what used to be the largest
Serbian brewer.
This was not enough to make up for the difference in the price offered for the
ownership stake.
Only two bidders applied for the call for tenders for BIP's takeover.
Ryanair Launches Flights to Maribor
Maribor airport welcomed on 7 June the first jet of Irish budget carrier Ryanair,
which brought over 170 passengers from London's Stansted airport to Slovenia's
second largest city
Maribor airport welcomed on Thursday, 7 June the first jet of Irish budget carrier
Ryanair, which brought over 170 passengers from London's Stansted airport to
Slovenia's second largest city.
The company has so far sold 11,000 tickets, which is "more than excellent", according
to Ryanair's sales and marketing director for Central Europe, Tomasz Kulakowski.
The airline will operate the route on Tuesday, 5 Junes, Thursday, 7 Junes and
Saturday, 9 Junes.
According to Kulakowski, the occupancy rate for June has already reached 80%. The
rate for July currently stands at 60%, while it is expected to reach 90%. Ryanair is
expecting about 40,000 passengers in the first year of operations.
Matjaz Sonc, the general manager of airport operator Aerodrom Maribor, said that the
arrival of the first Ryanair jet was the beginning of a new era for the Maribor airport.
He added that Aerodrom Maribor was considering introducing another route with
Ryanair, which could be realised as early as next year.
According to Sonc, Aerodrom Maribor last year made an ambitious plan aimed at
taking the company out of red by 2009. The company is also looking for new routes,
which would ensure long term development, said Sonc.
Mobitel, Simobil Expect No Problems with Roaming Fee Caps
Slovenia's biggest mobile operators said they expected no problems with the
implementation of an EU regulation that cuts charges for cross-border mobile calls
Slovenia's biggest mobile operators said they expected no problems with the
implementation of an EU regulation that cuts charges for cross-border mobile calls
and received the final stamp of approval by the member states on Thursday, 7 June.
The regulation stipulates that after final enactment of the rules, mobile phone
operators will have one month to offer customers a new pricing structure with
substantially lower roaming rates.
After another two months, users who have not expressed a preference will be
switched to the new tariff, which has been capped at 49 euro cents per minute for
making and 24 cents for receiving mobile calls abroad.
Market leader Mobitel said in a statement for STA that it would begin implementing
the regulation accordingly.
Similarly, Slovenia's second largest operator Simobil said it would follow the rules
accordingly and even try to surpass the provisions by offering customers the best rates
for EU and non-EU calls.
Mobitel users are currently paying between 70 cents and 1.38 euros per minute for
calls from the neighbouring EU countries of Austria, Italy and Hungary, depending on
the subscription plan.
Customers of Simobil, which is part of the Telekom Austria group, pay between 70
and 80 cents.
The fees for calls from other EU countries are much higher, however, and reach as
high as 2 euros per minute for calls from Lithuania.
Both operators predict that the new rules will not have an impact on revenues, as
roaming income represents only a small proportion of total income.
However, an analysis published recently by the business daily Finance suggests that
revenues from inter-connection charges and roaming represented as much as 37% of
Simobil's total income in 2005, or EUR 17.5m gross operating revenues.
Mobitel earned even more, EUR 23.7m, but this represented less than 17% of gross
operating revenues in 2005.
SLOVENIA IN BRIEF
Serbian Carrier Cancels Belgrade-Portoroz-Rome Route
Serbian flag carrier JAT has called plans for flights between Belgrade, Portoroz and
Rome despite a contract with Slovenian flag carrier Adria Airways, quoting a
shortage of jets, the Slovenian Tourist Board (STO) said on Tuesday, 5 June.
Shipyard Sells Its Real Estate
The troubled Ladjedelnica Izola shipyard sold all four hectares of land and 8,000 sq.
metres of offices to Oil Metal Company from Maribor in a deal worth about EUR
21m, Ladjedelnica Izola chairman Tomaz Jelocnik told STA on Tuesday, 5 June.
Ljubljana Airport Renamed in Honour of Dissident Pucnik
The government decided on Thursday, 7 June to honour dissident Joze Pucnik (19322003) by renaming the Ljubljana Airport Joze Pucnik Airport Ljubljana.
Koletnik Joins Zagozen at Helm of HSE
The government on Thursday, 7 June appointed Damijan Koletnik, the director of
power producer Dravske elektrarne, as the acting second member of the management
of Slovenia's largest power utility Holding Slovenske elektrarne (HSE). Koletnik will
join the hitherto sole general manager of HSE Joze Zagozen.