Slovenia Business Week no. 27, July 4th, 2005
HEADLINES ............................................................................................................................. 3
Govt Meets with Savinjsko-Salesko Mayors, Business People ............................................. 3
Jansa Criticises Effectiveness of Public Sector ...................................................................... 3
Rupel and Rice Discuss Uzbekistan and Kyrgyzstan ............................................................. 4
INTERNATIONAL COOPERATION ...................................................................................... 5
EU Budget Dominates Talks by Slovenian, Hungarian FMs ................................................. 5
OSCE Reform Report: Sense of Common Purpose Key to Effective OSCE ........................ 5
Croatian-Slovenian Commission Says Economic Cooperation Good ................................... 7
Drnovsek Receives Dutch and Irish Ambassadors ................................................................ 7
Vojvodina Official Visits Slovenia to Boost Trade ............................................................... 8
Rupel Addresses OSCE Parliamentary Assembly ................................................................. 8
New Bosnia Ambassador Talic Calls on FM Rupel .............................................................. 8
EUROPEAN UNION ............................................................................................................... 10
Survey: Third of Slovenians Believe EU in Serious Crisis .................................................. 10
Government Attends Seminar in Preparation for EU Presidency ........................................ 10
EU Proposes Transitional Period for Digital Tachographs .................................................. 10
EU Affairs Committee Examines Govt's Two-Region Proposal ......................................... 11
Full EU Membership Big Challenge for Turkey, Kokalj Says ............................................ 11
Foreign Ministry Says Britain Ready to Take on the Challenge.......................................... 11
British EU Presidency to Promote Budget Talks and Enlargement ..................................... 12
Zagar: Classification as Two Regions Most Realistic Position ........................................... 12
LEGISLATION ........................................................................................................................ 14
Brezigar Announces Establishment of White Collar Crime Task Force.............................. 14
Division to Two Cohesion Regions to Be Signed into Law in July ..................................... 14
National Council Vetoes RTV Slovenija Act ...................................................................... 14
STATISTICS/FORECASTS .................................................................................................... 16
Cigarettes Dearer as of July ................................................................................................. 16
Real Measures Needed to Maximise Economic Growth, IMAD Says ................................ 16
Govt Moves to Increase Oil Reserves .................................................................................. 17
Inflation Slows to 1.9% in June ........................................................................................... 17
Number of Live Births Highest after 2000 ........................................................................... 17
Slovenia Lowers Greenhouse Gas Emissions in 2003 ......................................................... 18
FINANCE................................................................................................................................. 19
SID Signs Deal with Belarus Export Agency ...................................................................... 19
Govt Adopts Regulation on FDI Incentives ......................................................................... 19
Govt Gives ITF EUR 88,000 for Demining in Caucasus ..................................................... 20
Stock exchange ..................................................................................................................... 20
Foreign exchange ................................................................................................................. 20
REGIONAL INFORMATION ................................................................................................ 21
Govt Pledges to Link Savinjsko-Salesko with Motorway Network .................................... 21
BRANCH INFORMATION .................................................................................................... 22
Sugar Reform Spells Trouble for Small Producers, Sugar Plant Says ................................. 22
Ljubljana Airport Criticised for Lax Security ...................................................................... 22
COMPANIES ........................................................................................................................... 23
Domel Increases Sales, Profits Drop .................................................................................... 23
PM Praises Home Appliance Maker as Example for Others ............................................... 23
Koncept Optimum Employees File for Bankruptcy ............................................................. 23
Store Steel Mill to Bolster Production in Next Five Years .................................................. 24
Zavarovalnica Maribor to Start Merging with Tilia ............................................................. 24
Adriatic and Slovenica Shareholders Approve Merger ........................................................ 25
New NLB Supervisors Appointed........................................................................................ 25
Ultra Enters Joint Venture with Mobile Giant NTT DoCoMo ............................................ 26
Peklar Denies Money Laundering Allegations .................................................................... 26
Slovenian Car Industry Supplier Opens an Investment in Serbia ........................................ 27
Gorenjska Banka Tops Country Ranking............................................................................. 27
Heraklith to Take Over Termo Despite Some Problems ...................................................... 27
Zavarovalnica Maribor Ups Collected Premiums by 7% ..................................................... 28
Brunner Shocked at Money Laundering Allegations ........................................................... 28
Mutual Insurer Raises Premiums for 900,000 People .......................................................... 28
Zagozen Takes Over at HSE ................................................................................................ 29
Triglav Anticipates to Increase Profit by Half in 2005 ........................................................ 29
Krka Drug Taken Off Shelves in Bosnia ............................................................................. 30
Jankovic: Mercator's Goal to be No. 3 in Croatia ................................................................ 30
Third Largest Bank Gets New Supervisory Board ............................................................... 30
FAIRS, CONGRESSES ........................................................................................................... 32
No Significant Changes in Public Sector after EU Entry..................................................... 32
NATO-Russia Council Conference Begins in Ljubljana Today .......................................... 32
SLOVENIA IN BRIEF ............................................................................................................ 33
Politbarometer Poll: Support for Jansa Govt Down Slightly ............................................... 33
Panel Hands OSCE Reform Proposal to Rupel .................................................................... 33
Rupel Meets Minority ahead of Talks with Hungarian FM ................................................. 33
Two Slovenians Nominated for Nobel Peace Prize ............................................................. 33
Ambassador Benedejcic Accredited to Turkmenistan ......................................................... 33
Regulations on Women Quotas for Local Elections to Be Eased ........................................ 33
Slovenia Gets Four New Ambassadors of Science .............................................................. 34
Government Appoints Romsek Police Chief ....................................................................... 34
Slovenia to Help Children of Chernobyl .............................................................................. 34
2
HEADLINES
Govt Meets with Savinjsko-Salesko Mayors, Business People
The cabinet meet with the mayors of the Savinjsko-Salesko region as the final act of its tour of
this eastern region on Wednesday, 29 June to get first-hand information about the problems
pestering the region
The mayors as well as the government officials agreed that the region's greatest problem was
poor road infrastructure.
Transport Minister Janez Bozic had earlier promised the government would do everything in
its power to speed up construction of an expressway connecting the region with the Ljubljanamaribor motorway.
Velenje mayor Srecko Meh said that the mayors insist the road must pass by the town of
Sostanj. If not, problems might emerge, he said.
According to Meh, the region's development will be based on energy, but education matters as
well. He also said something will have to be done with the prices of utility services, which are
too low and do not cover the actual costs.
Evgen Dervaric, the director of the Premogovnik Velenje coal mine, warned the government
that the mine will lay off 1,000 workers over the next 10 years as it restructures.
According to him, that is why the coal mine has also started to get involved in tourism. Yet he
was concerned that the region has not been placed in the government's latest programme for
the development of tourism destinations.
PM Janez Jansa told the local mayors and businessmen that the region will be one of the 14
regions that the government will propose in the new act on regions. This would boost its
development, he thought.
Jansa Criticises Effectiveness of Public Sector
Prime Minister Janez Jansa on Thursday, 30 June criticised the effectiveness of the country's
public sector in his address to the third business conference of the public sector
"The yield per hectare is too low and subsidies are still being granted...which results in
excessively high taxes," Jansa said, adding the inefficient and irrational public sector was an
enormous consumer.
According to him, public administration was functioning well at the beginning of the 1990s,
when practically everything was public sector. "The time between decision and
implementation was shorter 15 years ago than it is today," Jansa said.
While the public sector in its broader sense had shrunk since then, public administration has
expanded drastically. "Quality has increased in some segments, but after being in government
for six months, I can say effectiveness has generally not improved," Jansa observed.
Compared to other post-communist countries that entered the EU a year ago, Slovenia has
been slower in reforming the public sector. "The countries made more radical reforms of the
public sector, even though some of them were not for the better," Jansa said.
According to him, one of the reasons Slovenia was slower was that in the transition to a
market economy, public sector was functioning better than in other post-communist countries.
As a key problem of the public sector, Jansa highlighted the mentality that the state should
take care of the individuals' well-being with its social policy, which according to him would
have to change since economic progress alone could provide well-being.
He also mentioned privatisation and what he said were missed opportunities, in particular the
fact that insufficient private capital was drawn into the building of the motorway network,
which resulted in a lack of funding for other infrastructure.
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"It is therefore necessary to introduce a public-private partnership system. We are one of the
few countries without it," Jansa observed.
He said the changes could be implemented in a reasonable period of time. "In the new
government, we have formed a new Public Administration Ministry for this purpose," Jansa
said, adding that some things had been improved merely by tweaks to regulations.
According to Jansa, new legislation is being drafted in the field, introducing a model of
quality into the public service, while the granting of public finances is actually becoming
public.
Rupel and Rice Discuss Uzbekistan and Kyrgyzstan
Uzbekistan and Kyrgyzstan topped the agenda as Foreign Minister and OSCE chairman
Dimitrij Rupel met Friday, 01 July US Secretary of State Condoleeza Rice. The officials also
briefly discussed EU enlargement, with Rupel insisting it should extend to the entire area of
Western Balkans, not only Croatia
Rupel told the press after the meeting that his views on the situation in Uzbekistan and
Kyrgyzstan, where the government is considering deporting 29 Uzbek refugees, got full US
support. Slovenian and US standpoints are quite similar on this issue, according to the him.
Rupel said the US still firmly backs an independent international inquiry of the events that
took place in the Uzbek city of Andijan this May, when the police shot at the protesters. "The
US, OSCE and NATO are unanimous on this issue," Rupel stressed.
Moreover, the US backs the OSCE reform. Rupel invited Rice to attend the OSCE ministerial
meeting in Ljubljana in December, and said he thinks she would come.
In reference to the meeting at the conclusion of Slovenian OSCE presidency, Rupel said a
situation similar to that at the end of the Dutch and Bulgarian presidencies, when no
concluding documents were adopted, should be avoided.
Rupel announced on Thursday, 30 June that he would also discuss EU issues with Rice. After
today's meeting, 01 July he said he does not know to what extent the US is actually prepared
to be engaged in positive changes in Europe, including further enlargement.
However, the minister said the US certainly supports those in favour of such changes. His
impression was that the US position regarding Croatia, Turkey and the Western Balkans was
favourable.
"It would be wrong for the EU enlargement to stop with Croatia. Another day will come after
Croatia and others await their turn. Slovenia will not rest until the EU enlargement
encompasses the entire Western Balkans," Rupel underscored.
He added he also discussed with Rice the OSCE role in determining a final status for Kosovo.
4
INTERNATIONAL COOPERATION
EU Budget Dominates Talks by Slovenian, Hungarian FMs
The EU spending plan for 2007-2013 topped talks held by Slovenian and Hungarian foreign
ministers in Ljubljana on Tuesday, 28 June. The pair examined Hungary's proposal that the
EU consider adopting a transitional three-year budget if an agreement on the seven-year plan
is not adopted by the end of the year
According to Slovenian Foreign Minister Dimitrij Rupel, the prime ministers of the Visegrad
group and Slovenia and Austria are to examine Hungary's proposal for a transitional budget at
a forthcoming meeting, the date of which has not been determined yet.
Rupel stressed that Slovenian Prime Minister Janez Jansa has already welcomed the
Hungarian proposal.
According to Hungary's minister Ferenc Somogyi, who paid a one-day official visit to
Slovenia today, the goal of his country's proposal is to ensure the efficient phasing of EU
funds after the end of the current EU spending plan.
Meanwhile, Rupel announced today that Slovenia was preparing a number of proposals
related to EU enlargement. Both Slovenia and Hungary are in favour of the promotion of
European prospects, Rupel told the press on Tuesday, 28 June.
As regards the EU entry talks with Croatia, Rupel said Slovenia's opinion and its wish are for
the negotiations to start this summer or fall. Somogyi added that Hungary also wishes
progress for Croatia subject to certain conditions.
The pair agreed that the countries have good bilateral relations. Rupel pointed out that
Slovenia has a slight deficit in bilateral trade, while adding that the two countries should look
to tap in on all the potential for cooperation in business.
Hungary is eighth among the biggest Slovenian trade partners. Nevertheless, Somogyi
believes Slovenia should try to increase the volume of its exports to Hungary. He also pointed
out that Hungary was interested in investing in Slovenia.
Moreover, the two countries share common interests on the fifth pan-European transport
route, Rupel said.
The two ministers also examined the situation of the Slovenian minority in Hungary, with
Rupel saying that Slovenia would like to see Hungary grant greater rights to the community.
According to Somogyi, the complications surrounding the situation of the Slovenian minority
has not cast a shadow on bilateral relations between the countries.
Hungary is trying to locate financial means for the Slovenian minority, such as subsidies for
schools, Somogyi also said. His country will also try to solve the problems facing the
Slovenian-language radio station, he added.
Somogyi also met PM Janez Jansa and Parliament Speaker France Cukjati. Jansa and the
Hungarian FM agreed that the two countries have good bilateral relations, adding that there
are numerous opportunities for the two countries to strengthen economic ties.
OSCE Reform Report: Sense of Common Purpose Key to Effective OSCE
The OSCE needs to create a stronger sense of common purpose among the 55 participating
states in order to increase its effectiveness, a report on OSCE reform says
According to the report drawn up by a group tasked to discuss OSCE reform, the participating
states must be made to "feel that they have a stake in the organisation and that they are treated
as equals".
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The OSCE can achieve this by focusing on areas in which it has comparative advantages and
where it can add value, the 32-page report entitled "Common Purpose" by the Panel of
Eminent Persons points out.
New global challenges and threats call for a comprehensive approach involving all three
dimensions of OSCE operations, says the report, which was handed to Slovenian FM and
OSCE chairman Dimitrij Rupel by the head of the panel, Norwegian diplomat Knut
Vollebaek, earlier this week.
The seven-member panel also concludes that the organisation's priorities must include
bolstering political dialogue, early conflict warning and prevention, post-conflict
rehabilitation, weapons monitoring, trust-building measures and the fight on terrorism,
extremism and organised crime.
Moreover, the organisation should focus on the promotion of police training, border
management, the rule of law, the promotion of regional economic cooperation, the promotion
of tolerance, election observation, institution-building and the fight against human trafficking,
the report says.
According to the document, the OSCE must apply a cross-dimensional approach to tackling
security issues. Among the main tasks, the organisation's politico-military dimension should
be brought into line with modern challenges, the report points out.
Moreover, in the economic and environmental field, the OSCE should "strengthen its
capacities on the ground to support and help in meeting local challenges by mobilising
international resources".
As for the human dimension, the report calls for the assurance of unbiased and standardised
monitoring of human rights standards and the furthering of the OSCE's role as an election
watchdog.
The Panel of Eminent Persons also calls for structural changes in the OSCE, saying that the
organisation should seek to change its status from a conference into a full-fledged
international organisation.
Moreover, the organisation, the report says, should also adopt a statute or charter with basic
goals, principles and commitments in a bid to become a full-scale regional organisation.
"The OSCE's profile among other international organisations would be raised by focusing
more clearly on a limited range of priorities, giving a more public and long-term face to its
leadership, and encouraging a stronger sense of ownership among its participants."
The report also calls for the OSCE to raise public awareness about its activities and goals as
well as the importance of field operations. The document urges the organisation to grant a
more visible role to the secretary general.
The panel also recommends the introduction of committees to deal with the three dimensions
of OSCE operations. A committee structure "would focus the agenda of the Permanent
Council and would raise its profile as a forum for political dialogue and decision-making", the
report says.
The panel was unanimous on all recommendations but one: the future of the Forum for
Security Cooperation (FSC). While most of the seven-member panel expressed the view that
the new security committee could replace the FSC, this view was not shared by Russia and its
member on the panel, who claimed the FSC should be preserved.
The report says that the OSCE should continue to take decisions unanimously, adding that the
participating states should not be allowed to abuse this to block decisions on high
representatives of the organisation. Countries that block decisions intentionally could be
named in public, the panel says.
The annual OSCE ministerial meeting should regain public interest by focusing on a political
communique instead of taking decisions on numerous issues, most of which could be handled
by the Permanent Council, the report adds.
6
Furthermore, a clearer line should be drawn between the tasks of the chairman-in-office and
the secretary general, the report points out, with the former being in charge of political tasks
and the latter taking care of day-to-day operational matters.
Presenting the report to Rupel in Ljubljana on Monday, 27 JuneVollebaek said the document
does not constitute a revolution, given that a revolution is not needed.
Meanwhile, Rupel said the report should get the ball rolling. According to him, the OSCE
now has the basis and framework that should make a part of a final agreement on reform.
The OSCE permanent council is expected to discuss the report on Thursday, 30 June in
Vienna. The proposals will then enter a high-level consultation process in September, and will
be debated at the OSCE ministerial in December in Ljubljana.
Rupel appointed the Panel of Eminent Persons in February as part of Slovenia's efforts to
reform and revitalise the OSCE.
Croatian-Slovenian Commission Says Economic Cooperation Good
Economic cooperation between Slovenia and Croatia is good and improving, the SlovenianCroatian commission for economic cooperation concluded after a meeting on Wednesday, 29
June
Croatia and Slovenia have witnessed an increase in trade, improvement in tourism, and
numerous Slovenian investments in Croatia, and vice versa, State Secretary at the Economics
Ministry Andrijana Starina Kosem and her Croatian counterpart Vladimir Vrankovic agreed at
the press conference.
At the meeting, working groups for electronic communication, competitiveness, small
businesses and investments, standardisation, technical and administrative boundaries, tourism,
cross-border employment, and agriculture discussed incentives for cooperation between the
two countries.
Vrankovic and his colleagues were pleased with today's quality work of the bilateral
commissions. Moreover, Vrankovic denied that Slovenian exports to Croatia are on the
decrease, as data prove the opposite.
Among the countries of former Yugoslavia, Croatia is Slovenia's most important trade
partner.
According to the Statistics Office, Slovenian exports of goods and services to Croatia
amounted to EUR 1.16bn last year, 15.6% more than in 2003, while imports stood at SIT
512.4m (EUR 2.14m).
Drnovsek Receives Dutch and Irish Ambassadors
President Janez Drnovsek on Friday, 01 July received Dutch Ambassador Jan C. Henneman
and Irish Ambassador Gary Ansbro, whose term in Slovenia is expiring, the president's office
said in a press release
The Dutch ambassador said he was happy to have served in Slovenia at the time of its EU and
NATO entry. Henneman and Drnovsek discussed further European integration after two
rejections of the EU constitution.
The officials established that the opinion of EU citizens would be important for further
integration as well as enlargement. Moreover, they discussed the integration of Western
Balkans and the role of Slovenia in the process.
Ansbro meanwhile underscored that Slovenia and Ireland have a lot in common, which
reflects in their relations. He welcomed Slovenia successes during his term.
In view of Ireland's EU presidency in that period, Ansbro stressed the countries have achieved
good cooperation. The officials also debated future rounds of EU enlargement and Slovenia's
role in the integration of Western Balkans.
7
Vojvodina Official Visits Slovenia to Boost Trade
State Secretary at the Foreign Ministry Bozo Cerar on Friday, 01 July received the President
of the Executive Council of the autonomous province of Vojvodina Bojan Pajtic. The officials
mainly discussed economic issues, the ministry said in a press release
Cerar advocated the standpoint that Slovenian companies should be treated as equals in trade
as well as in privatisation and acquisitions of companies.
Pajtic's visit to Slovenia was mainly aimed at exchanging information on development
programmes and seeking opportunities for direct economic cooperation, which were the key
topics also during Pajtic's visit to the Economics Ministry and the Chamber of Commerce
(GZS).
In his talks with Economics Ministry State Secretary Andrijana Starina Kosem, Pajtic
presented Vojvodina's priority programmes in tourism and said the province was interested in
seeing Slovenian investments increase.
Pajtic also called for Slovenia's help in restructuring the economy of the province, especially
its agriculture.
Rupel Addresses OSCE Parliamentary Assembly
FM Dimitrij Rupel, the OSCE chairman, has urged delegates at the OSCE Parliamentary
Assembly to thoroughly study the proposal for an overhaul of the organisation, as the OSCE
is facing a period of crucial reforms
Speaking in Washington, D.C late on Friday, 02 July Rupel said that the organisation has
done a good job in Ukraine and Kyrgyzstan, but the situation in Uzbekistan is not so good.
The truth about the 13 May events in Andijan is still unclear, and will continue to be until
there is an independent international inquiry, said Rupel, urging Uzbek authorities to
cooperate if they have nothing to hide.
"We are determined to fight terrorism, but we are equally determined to safeguard human
rights," said Rupel.
The OSCE chairman was more upbeat about the Caucasus, as Georgia and Russia are starting
to talk about troop withdrawal, and Nagorno Karabakh, where he hopes high-level talks will
be successful.
For Kosovo, too, dialogue is vital, he said, and the OSCE can play an important role in the
next few months as the future of the province is being debated.
Rupel's address at the OSCE PA was one of the stops on his tour of Northern America. He has
also met US Secretary Condoleezza Rice, Secretary General of the Organisation of American
States Jose Miguel Insulz and Deputy US National Security Adviser Jack Dyer Crouch.
Rupel and Dyer discussed some of the most burning issues on the OSCE agenda. They
agreed, according to the Foreign Ministry, that Uzbekistan must respect the commitments it
has made towards the OSCE, and underlined the need for an independent inquiry into the
events in Andijan.
On Saturday Rupel Canada met the Slovenians living there and attend on Sunday, 03 July a
celebration of National Day at a Slovenian resort in Bolton.
New Bosnia Ambassador Talic Calls on FM Rupel
The new Bosnia-Herzegovina Ambassador to Slovenia Izmir Talic and Slovenian FM Dimitrij
Rupel believe the relations between Slovenia and Bosnia-Herzegovina are good, but
nevertheless wish for cooperation to strengthen, the Foreign Ministry said in a press release
Monday, 27 June
"Slovenia supports Bosnia-Herzegovina in its bid to join Euro-Atlantic organisations, and is
ready to share its experiences," FM Rupel said as he met Talic. He also stressed that the
Western Balkans remain one of priorities of Slovenia's foreign policy.
8
Rupel also took the opportunity to express his support for Bosnia-Herzegovina's joining
NATO's Partnership for Peace programme. However, he said the country must first fulfil its
obligations. For instance, it should cooperate with the International Criminal Tribunal for the
Former Yugoslavia, the ministry added.
Ambassador Talic and FM Rupel also discussed the upcoming 10th anniversary of the
Srebrenica genocide, which is to be commemorated in a ceremony at the Potocari Memorial
Centre near Srebrenica.
9
EUROPEAN UNION
Survey: Third of Slovenians Believe EU in Serious Crisis
A survey has found that nearly a third of Slovenians think the EU is in a serious crisis.
Moreover, the majority of Slovenians believe the adoption of the euro will have more negative
consequences than good, results of the Politbarometer survey show
According to the survey released on Monday, 27 June 31% of the respondents believe the
current EU crisis is serious. Meanwhile, 50% think it is a passing crisis, while only 8% think
that the EU is not in a crisis.
Meanwhile, as many as 59% of the respondents expect the euro will have more negative
consequences for Slovenia than positive. On the other hand, 23% are convinced of the
benefits of the euro and 18% are unsure what the euro will bring.
According to Slavko Kurdija of the Centre for Public Opinion Research, which conducts the
Politbarometer, public opinion on the euro remains stable.
If the public were to be asked whether Slovenia should adopt the euro, the answer would
surely be different, he told the press on Monday, 27 June.
The poll was conducted between 20 and 22 June with 872 respondents taking part.
Government Attends Seminar in Preparation for EU Presidency
A seminar for the prime minister, the ministers and state secretaries was held at Brdo pri
Kranju on Monday, 27 June as part of Slovenia's preparations for EU presidency in the first
half of 2008, the PM's office has said
Jacques Keller-Noellet, deputy director general of the EU Council general secretariat's
directorate for general political questions, and Boby McDonagh of the Irish Foreign Ministry
presented the general framework of how to best prepare for EU presidency.
The pair in particular outlined the preparations in Brussels carried out in collaboration with
the Council's general secretariat, and domestic preparations.
Preparations for EU presidency have kicked off already. The Foreign Ministry confirmed
earlier in June that special task forces have been set up for personnel, logistics, financial and
other issues.
EU Proposes Transitional Period for Digital Tachographs
The EU has proposed a transitional period for the introduction of digital tachographs, as
about half of all member states, including Slovenia, are not ready to make a full changeover
by 5 August this year as initially planned, Transport Minister Janez Bozic said on Monday, 27
June
Speaking on the margins of a meeting of EU transport ministers, Bozic said Slovenia would
endeavour to make the changeover until 1 January 2006 when the transitional period expires.
However, there is not much time: the required legal basis is awaiting second reading in
parliament, and a public tender will have to be issued. "We will do everything to achieve this
objective," Bozic said.
According to him, digital tachographs will significantly improve road safety, which is why the
deadline has not been moved back further despite some debates about this option.
The ministers today also talked about the introduction of a uniform pan-EU drivers' licence,
which Slovenia endorses. The member states are yet to agree on a time frame for the common
licence.
10
EU Affairs Committee Examines Govt's Two-Region Proposal
The parliamentary EU affairs committee on Friday, 01 July looked into the government's
proposal to divide the country to two cohesion regions for the purposes of EU funding
The committee asked the government to explain why it has proposed two region instead of
three as planned in the declaration on Slovenia's priorities in the EU, and whether the EU
allows possible exceptions due to a country's specifics, according chair Anton Kokalj.
He said the government substantiated its proposal with well-known arguments: that success is
much more likely if Slovenia requests two regions, and that the long-term difference between
the amount of funds is negligible for either scenario.
According to him, some committee members believe that Slovenia's negotiating position
would be better if it pushed for three regions, and that it should try to negotiate an exemption
from the population size requirement.
One of the basic EU criteria for cohesion regions is a minimum population of 800,000;
Slovenia has less than 2 million people.
Kokalj said that all MPs agreed this issue is so important that the coalition and opposition
should not pull each their own way.
The deputy group of the opposition Liberal Democrats (LDS) said in a press release after the
session that it had proposed a bipartisan consensus and change the constitution if necessary to
underpin the three-region argument.
Since the committee did not endorse the LDS proposal for a decision binding on the
government, LDS believes that the government is thus missing a big opportunity and thus
restricts the development of a significant part of the country.
Full EU Membership Big Challenge for Turkey, Kokalj Says
According to the chair of the parliament EU affairs committee Anton Kokalj, Slovenia agrees
with the negotiation plan the European Commission drew up for Turkey on Wednesday.
Moreover, Slovenia does not object to Turkey becoming a full-fledged member of the EU,
Kokalj told STA on Thursday, 30 June
Paying a visit to Ankara, Kokalj said he believed Turkey will have its work cut out during the
EU entry talks. This could prove to be a lengthy process, he said on the last day of his visit to
the country, which is convinced the negotiations will start on 3 October.
His Turkish colleagues pointed out that Turkey does not wish to have a privileged status, but
wishes to become an equal member of the EU, Kokalj also said. "They are ready to work hard
to reach this goal," he added.
According to Kokalj, Turkish officials believe Slovenia's experiences with EU membership
negotiations could help them in their bid to join the bloc. They have shown great interest in
cooperating with the government departments and parliamentary committees in Ljubljana, he
said.
During the visit, the parliament EU affairs committee and the Turkish parliament human
rights committee discussed Turkey's progress in the field of human rights over recent years.
Today, the Slovenian officials are scheduled to meet Slovenia's Honorary Consul in Istanbul,
Mustafa Basar Arioglu.
Foreign Ministry Says Britain Ready to Take on the Challenge
The British EU presidency comes at a time when citizens of certain member states clearly said
they want a Union closer to them, more transparent and more efficient. Great Britain is ready
to take on this challenge, the Foreign Ministry said in a statement on Friday, 01 July as
Britain assumed the rotating presidency
According to the ministry, Slovenia supports the objectives and priorities that Britain has set
and which are good and ambitious.
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Slovenia is glad that agreement on the 2007-2013 financial perspective is one of the priorities,
and will work actively for budget talks to conclude as soon as possible.
The ministry also said that further enlargement is necessary and urgent, as it expands the area
of prosperity and stability and makes the EU a stronger international player.
Western Balkans is a part of Europe, so it is in everyone's interest that these countries accede
to the EU, the ministry said, adding that Slovenia will continue to make efforts to achieve this.
British EU Presidency to Promote Budget Talks and Enlargement
The British EU presidency will promote negotiations on the next EU financial perspective and
advocate further EU enlargement by starting accession talks with Turkey on 3 October,
British Ambassador to Slovenia Tim Simmons said as he presented Great Britain's EU
presidency plans to Slovenian lawmakers in Ljubljana on Friday, 01 July
According to Simmons, Britain would like its priorities to help the EU deal with three of its
main challenges: to respond to globalisation, modernise the economy and create an adequate
defence and security policy.
Simmons moreover underscored that the British presidency would mainly focus on the
following four big issues: reform of the European economy; European security; climate
change; and Africa.
According to him, the adoption of the directive on working time would also be one of the
goals, as is the further integration of the West Balkans in the EU. The prospects of EU entry
are a way towards reform and modernisation for the region, he noted.
The British presidency plans to present a new proposal on the EU budget framework in
accordance with the challenges of the 21st century, Simmons said. Asked whether the budget
agreement would be reached during the British presidency, he made no guarantees, saying
there is enough time and will to at least outline the main priorities.
London does not consider abolishing the common EU agricultural policy, Simmons said.
According to him, financing in agriculture should be more dynamic and in line with other EU
goals according to the Lisbon Strategy.
In reforming the European economy, Britain aims at making business environment more
favourable. Simmons also mentioned strengthening cooperation in the fight against terror and
liberalisation of trade, including making world markets more accessible for less developed
countries.
The British priorities were welcomed by EU Ambassador Erwan Fouere, who also attended a
joint session of the parliamentary foreign policy and European affairs committees.
Fouere said London is taking over the EU presidency in what is a critical moment for EU
development. He welcomed the country's intention to promote discussion with EU citizens.
Fouere also backed Slovenia's regional development bill envisaging two cohesion regions,
saying the country had better chances of negotiating it than if it had proposed a division into
more regions.
Zagar: Classification as Two Regions Most Realistic Position
The reclassification of Slovenia into two cohesion regions in line with the bill on the
promotion of balanced regional development is the most realistic basis for negotiations with
the EU, Slovenia's regional affairs minister has said
According to the Minister of Local Government and Regional Policy Ivan Zagar, Slovenia
does not have a chance to seek classification as three regions, given that one of the criteria is a
population of at least 800,000.
Moreover, Zagar told the press on Tuesday, 28 June in Ljubljana that Slovenia stands to lose
30% to 40% in regional aid if classified as one region rather than two.
12
Zagar's comments came as he presented the government-sponsored bill on the promotion of
balanced regional development. According to the proposal, the country would be divided into
the more developed northwest and the larger, less prosperous southeast. That way, the
southeast would retain eligibility for EU cohesion funds.
The bill was adopted by the government last week and sent to parliament for fast-track
adoption. Zagar hopes it will be adopted by lawmakers in July.
The minister also explained today that Slovenia's municipalities would be given a chance to
forward their proposals on the bill. The government will consider all serious proposals that
could make the bill better, he said.
The adoption of the bill became a priority for Slovenia after last week's collapse of EU budget
talks, which means that Slovenia stands to lose a large chunk of regional aid if it remains
classified as one region, Zagar said.
The reclassification into two regions would also allow Slovenia to improve its position for
talks on EU spending after 2013.
Zagar also answered the complaints of the Gorenjsko region on the bill, which claimed last
week that it would lose out on funds as part of the government's proposal. According to him,
the Gorenjsko region cannot be part of the poorer cohesion region.
He added that in spite of its inclusion in the richer of the two regions, Gorenjsko would still
be able to obtain money from the EU's cohesion fund.
Meanwhile, the opposition Liberal Democrats (LDS) reiterated Tuesday their claim that the
two-regions proposal is bad for Slovenia.
The main opposition party believes Slovenia should seek to be reclassified as three regions,
which would make it entitled to more regional aid.
Although the threshold for an EU region is a population of 800,000, the EU has 56 regions
that do not meet this criterion and nevertheless enjoy the status of a cohesion region, LDS
deputy Milan M. Cvikl told the press on Tuesday, 28 June.
13
LEGISLATION
Brezigar Announces Establishment of White Collar Crime Task Force
State Prosecutor General Barbara Brezigar has announced the establishment of a special
group of prosecutors dealing with white collar crime. According to Brezigar, the group would
work with financial experts in uncovering corporate crime
Brezigar told business daily Finance Monday, 27 June that she intends to put forward
amendments to the act on the state prosecution service to the Justice Ministry which would
enable the task force to be set up.
The biggest concern in fighting white collar crime is the knowledge possessed by prosecutors,
she said.
Brezigar, who took over as state prosecutor general in early May, also said she wanted to
make sure that prosecutors have sufficient training in uncovering cases of corporate crime.
Moreover, she believes the Corruption Prevention Commission has the means to prevent
graft, although she has not seen enough action from the agency so far. She added that she
could not give an assessment of the extent of corruption in the country.
Asked by Finance whether she could be a key player in ensuring a second term for Prime
Minister Janez Jansa, Brezigar said that "good work by the prosecutors can help the ruling
political party."
Division to Two Cohesion Regions to Be Signed into Law in July
The bill on the promotion of balanced regional development, which envisages the country's
division into two cohesion regions, is to be passed in an emergency procedure in July. The
decision was taken on Monday, 27 June by the collegiate body of the parliament speaker
According to the proposal, the country would be divided into the more developed northwest
and the larger, less prosperous southeast. That way, the southeast would retain eligibility for
EU cohesion funds.
The proposal for the division emerged after PM Janez Jansa said that Slovenia would
immediately launch negotiations with Brussels on the country's division into several statistical
regions given the failed negotiations on the next financial period 2007-2013.
National Council Vetoes RTV Slovenija Act
The upper chamber of parliament on Wednesday, 29 June vetoed the act on public
broadcaster RTV Slovenija in a 21-to-7 vote, sending it back for a re-vote to the National
Assembly
National Council president Janez Susnik was quick to point out that the veto was not
associated with the opposition's bid to challenge the act in referendum.
Instead,the councillors want to avoid a referendum which is "very disagreeable," Susnik told
the press today.
The National Council opted for the veto vote because the parliament failed to consider their
remarks to the disputed act, or the proposals of the civil society and media experts.
Most notably, the upper chamber is disappointed with the parliament's reluctance to preserve
the role of the civil society in the appointment of the national broadcaster's governing bodies.
The veto means that the act must be passed in parliament again, this time with the absolute
majority of all votes (at least 46 votes), if it is to take effect.
Meanwhile, the opposition Liberal Democrats (LDS) have already announced that they would
call a referendum on the act if it were passed in the renewed vote.
14
The LDS and fellow opposition Social Democrats (SD) gathered 30 signatures from MPs
necessary to call a referendum.
Parliament Speaker France Cukjati has already announced that the renewed vote would take
place at the next regular session of parliament, ie. in July.
15
STATISTICS/FORECASTS
Cigarettes Dearer as of July
The retail price of cigarettes will rise 7.1% on Friday, 30 June in line with the amended law
on excise duties. A packet of cigarettes will now cost SIT 450 (EUR 1.88) on average, SIT 30
(EUR 0.13) more than now
The increase comes after the law on excise duties was amended at the beginning of June,
envisaging that the excise duties on the most widely sold cigarettes should stand at 57% of the
retail price, a minimum according to the EU standards.
In total, the excise duties on 1,000 cigarettes will increase from EUR 50 to EUR 54 on 1 July.
The government is to raise an additional SIT 4.3bn (EUR 17.9m) in budget revenues as a
result.
Real Measures Needed to Maximise Economic Growth, IMAD Says
Slovenia is a relatively well-developed country that went through a successful transition. But
to qualify among the best, the country now needs to undertake substantive measures in fields
where it has the most trouble, the government Institute for Macroeconomic Analysis and
Development (IMAD) said as it presented the Development Strategy for 2005-2013
According to IMAD director Janez Sustersic, in order to meet the basic objective of the
Strategy - to catch up with the most developed EU countries - Slovenia's economy must grow
3 percentage points faster each year for the next eight year than the richest EU countries.
This is an ambitious goal that represents the absolute maximum of what can be achieved,
Sustersic said. According to him, Slovenia's economy grew at an average pace of 3.8%
between 1993 and 2003. Achieving growth of over 5% will require Slovenia to shift into
higher gear, he added.
In order to facilitate this shift, Slovenia needs a shift in mindset, he told the press in Ljubljana
on Wednesday.
The strategy, which is based on ensuring the prosperity of all citizens, sets four fundamental
goals. Apart from the economic goal, another aim is to improve the quality of life and the
welfare of Slovenian citizens. Moreover, the document sets sustainable development and
increasing Slovenia's global standing as primary goals, Sustersic outlined the document.
Boosting economic growth will require the promotion of entrepreneurship and
competitiveness. Moreover, the focus must be put on products with high value added,
including high technology goods and services, he said.
The government must stay focused on helping Slovenian business go global and make inroads
in fast-developing markets such as China, India and Brazil, Sustersic said. On the other hand,
it must pursue a policy that will see it withdraw from the economy, which would in turn
promote foreign direct investment.
Another priority, according to Sustersic, is to improve the flow of information between
education institutions and businesses. Moreover, young people must be encouraged to opt for
a career involving technical sciences, he said.
Slovenia must work determinedly on implementing the goals of the Lisbon Strategy, meaning
it has to spend 3% of gross domestic product on research and development, Sustersic said.
According to him, the government must make it its priority to build a more streamlined and
cost-effective public administration that would also facilitate the drawing of EU funds, as well
as to overhaul the tax system.
Other challenges facing the country include building a modern welfare state and promoting
faster job growth. The former will require more flexible labour legislation and the overhaul of
16
social security payments. According to him, the goal is to lower unemployment in Slovenia to
4%.
Meanwhile, Sustersic said that one of the basic shortfalls of previous development strategies
was a lack of adjustment to the situation on the ground. The new approach will pay a lot of
attention to implementation and the tailoring of the strategy to the actual situation, he said.
The Development Strategy was adopted by Slovenia's cabinet last Thursday. The strategy will
also serve as the basis for Slovenia's action plan for the implementation of the Lisbon
Strategy.
Govt Moves to Increase Oil Reserves
The government on Thursday, 30 June adopted a regulation on mandatory reserves of oil and
oil derivatives, to raise the amount of reserves to the equivalent of the average 90-day
consumption in 2004 by the end of the year
The regulation is in line with EU requirements, as Slovenia had negotiated a transitional
period until 31 December 2005, by which time it must ensure 90-day oil reserves.
Current reserves suffice for 75 days, the government said after today's session.
Inflation Slows to 1.9% in June
Inflation slowed to an annual rate of 1.9% in June, a new record low, as a drop in food prices
offset a spike in the prices of fuel and holiday packages, the Statistics Office said Thursday,
30 June
The inflation rate for the month stood at 0.1%, a significant drop on the same month last year.
Fuel prices rose 1.6% on average as a result of the rise in global oil prices, while holiday
packages were 6.1% dearer because of the forthcoming high season. Each contributed 0.2
percentage points to June's inflation.
However, food prices fell 1.5% to take away 0.3 percentage points from the monthly
Consumer Price Index (CPI), data from the office shows. Vegetable and fruit prices fell 8.4%
and 8.1% respectively in June.
Moreover, cheaper mobile telephone calls (0.5%) also eased the mounting pressure put on
inflation by climbing fuel prices.
According to the data, prices of goods fell 0.2% in June, while services were up 0.6%.
The average annual inflation rate, based on the harmonised consumer price index used in the
EU, stood at 3%, which is 0.2 percentage points less than a month earlier, the Office added.
May's average rate of 3.2% exceeded the eurozone compatible rate - the average of the three
eurozone members with the lowest inflation plus 1.5 percentage points - by 0.9 percentage
points.
Number of Live Births Highest after 2000
The number of live births increased in Slovenia by 3.6% to 17,961 babies in 2004 over 2003.
This is the second highest number of live births in seven years, after the year 2000, Tina
Znidarsic of the Statistics Office told the press on Thursday, 30 June
There were 9 live births per 1,000 people on average last year, Znidarsic said, adding that this
is half the number of births from the end of the 1950s. Moreover, Slovenia is an EU member
with the lowest birth rate, which is symptomatic of all new members.
Among the old members, Germany lags behind Slovenia with 8.6 children per 1,000 people,
mostly due to its Eastern part. Most live births, namely 15.5 per 1,000, take place in Ireland.
While birth rate is falling, the average age of mothers at first birth is increasing, according to
Znidarsic. Last year, the average age was 27.5 years, which matches the average age for the
second birth in 1970.
17
The fact that women decide to give birth later means the possibility of having another child
decreases. Half of the babies born in 2004 were thus firstborns, while in the 1950, they only
represented a third of all babies. Almost a fifth of all mothers were then having their fourth
child, compared to 3% in 2004.
Because of the decrease in marriages since the end of the 1970s, the number of children born
out of wedlock increaseds from 10% in the mid-1970s to 44.8% last year, which is the highest
number yet.
Among the most popular names for newborns last year was again Luka, given to 4.2% of
baby boys, and Nika for 3.6% of the baby girls.
Slovenia Lowers Greenhouse Gas Emissions in 2003
Slovenia managed to reduce greenhouse gas emissions in 2003, even though most of the
European Union saw emissions rise. According to data from the European Environmental
Agency (EEA), Slovenia's emissions fell by 300,000 tonnes or 1.5% in the year, while the
emissions of the EU25 were up 1.5%
Slovenia was thus only one of three EU countries to reduce emissions - Portugal and Ireland
were the other two, the EEA said in its report.
The main reason for the rise in greenhouse gas emissions in the EU in 2003 was the increased
output of thermal power plants and the cool weather in most member states. The biggest rise
in emissions was registered in Italy, Great Britain and Finland.
The emissions of carbon dioxide, which makes up for 80% of all greenhouse gas emissions,
rose by 1.8% in the EU 15 in 2003.
The EEA report says that Slovenian greenhouse gas emissions have fallen 2.9% to 19.9
million tonnes since 1990.
Meanwhile, the Slovenian Environmental Agency (ARSO) claims that Slovenian emissions in
2003 amounted to 19.8 million tonnes of carbon dioxide equivalents, which is 249,000 tonnes
less than in 2002.
According to ARSO, the total emissions in Slovenia stood at 18.6 million tonnes in 1990 and
20.2 million tonnes in 1986, the base year for Slovenia in the Kyoto Protocol.
According to Matej Gasperic of ARSO, the agency revised its data after sending its figures to
the EEA. The EEA was not expecting the new data and did not include it in the report, he
added.
Meanwhile, the EEA report concludes that EU has managed to reduce emissions by 1.7%
compared to 1990.
In contrast to the EU25, where rising output in the energy sector contributed the most to the
rise in greenhouse gas emissions, Slovenia registered a drop of 200,000 tonnes of emissions to
15.8m tonnes in this sector in 2003.
18
FINANCE
SID Signs Deal with Belarus Export Agency
The Slovenian Export Corporation (SID) has signed an agreement with the Belarus export
credit agency Eximgarant of Belarus. Cooperation is expected to facilitate bilateral trade and
investment, and help possible joint ventures at third markets
Eximgarant is the only insurance company in Belarus that acts as an export credit agency, SID
said in a press release on Friday, 01 July. It was set up in 1998 by the government of Belarus.
SID has similar deals with export agencies worldwide, including Germany's Hermes, Austria's
OEKB, Britain's ECGD, Dutch NCM, Belgian OND, American EXIM, Italy's SACE, Korean
KEIC, Turkey's EXIM Bank and others.
Govt Adopts Regulation on FDI Incentives
The government on Thursday, 30 June adopted a regulation on financial incentives for
foreign direct investment, which sets out the rules for incentives aimed at attracting
investments that create new jobs, bring in new know-how and technologies, and contribute to
balanced regional development
According to Economics Minister Andrej Vizjak, the regulation is a systematic basis for
measures aimed at attracting new investments, as opposed to the ad hoc system in place so
far.
"I believe this measure will attract foreign investors to small and mid-sized enterprises, not
only to mega projects, and can make a significant contribution to improving competitiveness,"
Vizjak told the press on 30 June.
Vizjak was confident that the amount of incoming FDI would double next year compared to
2005, and increase several-fold in the medium term.
Investors will be able to obtain funding to cover the costs of creating new jobs, and for
investments in tangible assets, notably the building of a new facility or the expansion of
existing facilities.
Depending on the region where the facility will be located, incentives will be awarded to
projects starting at EUR 1m (for the least developed regions of Pomurje, Podravje, Zasavje
and Spodnje Posavje).
The minimum value of the investment eligible for the aid rises to EUR 4m for the richest
regions of central Slovenia and the Gorisko.
Eligibility also depends on the number of new jobs that the investment will create: in
manufacturing the minimum is 50 and in services 10. Unless specified otherwise, jobs must
be preserved for at least 5 years.
The maximum value of an individual incentive may not exceed the assessed net current value
of revenues from taxes, social security contributions and similar fees that the investor will pay
to the state over the next five years, Vizjak explained.
According to Vizjak, about SIT 4bn (EUR 16.7m) is available for incentives this year taking
into account nearly SIT 3bn (EUR 12.5m) that car maker Revoz is getting.
There will be much more money next year, he said, as SIT 4bn are earmarked for Revoz
alone.
The regulation is based on the act on the promotion of foreign investment and
internationalisation of companies, which was signed into law last August.
19
Govt Gives ITF EUR 88,000 for Demining in Caucasus
The government has approved a SIT 21m (EUR 88,000) donation for the International Trust
Fund for Demining and Mine Victims Assistance (ITF) for its activities in the Caucasus
region
The money is to be spent on the organisation of a regional conference on demining under the
auspices of the OSCE, as well as assistance to mine victims and demining in Azerbaijan.
The Slovenian-run ITF specialises in demining in Southeastern Europe, but it expanded its
activities to the Caucasus region in 2002 at the urging of donor countries.
The government said on Thursday, 30 June that Azerbaijan, Armenia and Georgia suffer from
severe mine-pollution, so the country sees demining there as a crucial foundation for stability,
security and democracy.
This also fits with Slovenia's overall efforts in the region, which is in the focus of the OSCE,
which Slovenia presides over this year.
Stock exchange
Ljubljana Stock Exchange
The last week of June was one of the worst for the Ljubljana Stock Exchange (LJSE) this
year, as share prices plummeted across the board and the SBI 20 benchmark index briefly
touched a 15-month low on Thursday, 30 June, due to brewer Pivovarna Lasko drop by nearly
8.5%. The SBI 20 recovered on Friday, but still closed 1.79% lower on the week at 4,430.89.
Foreign exchange
U.S. dollar down
Euro (EUR)
U.S. dollar (USD)
Swiss franc (CHF)
British pound (GBP)
SIT 239.50
SIT 198.24
SIT 154.41
SIT 352.88
0.00
-0.23
-1.12
-8.68
20
REGIONAL INFORMATION
Govt Pledges to Link Savinjsko-Salesko with Motorway Network
The government has pledged to do everything in its power to link up the Savinjsko-Salesko
region with the motorway network as soon as possible, Transport Minister Janez Bozic told
the press during the government's visit to this eastern region on Wednesday, 29 June
According to Bozic, the necessary zoning laws will be drafted in no more than three years, so
construction of what is dubbed the "third development axis" could start in 2010 or 2011.
The route would run from the Austrian border on the north of the region to the motorway
linking Maribor and Ljubljana. From there on it would go through Celje and on to Bela
Krajina in the south.
Bozic said the first section is already included in the national motorway construction
programme, while the second section will be included in the amended programme which is
currently undergoing inter-departmental negotiations.
The region, which includes eight municipalities around Velenje and Sostanj, has been
underlining the lack of appropriate infrastructure as the biggest obstacle to faster economic
development.
As part of today's cabinet visit, a small, 43-metre bridge across the Savinja River was
ceremonially opened by PM Janez Jansa today at the small village of Luce.
21
BRANCH INFORMATION
Sugar Reform Spells Trouble for Small Producers, Sugar Plant Says
The reform of the EU sugar industry proposed by the European Commission last week spells
trouble for the whole industry, but especially for small producers, the head of Slovenia's lone
sugar plant has said
"The reform that was proposed by the European Commission last week is tailor-made for
large producers. However, our plant is among the smaller ones as it was built for a small
market," general manager of Tovarna sladkorja Ormoz Jure Dogsa told STA Monday, 27
June.
According to him, the European Commission has argued that the failure to adopt the reform
would represent an even bigger disaster for the EU sugar industry, with at least 60 plants
expected to close their doors.
The problem with that argument, Dogsa said, is that the Commission got the industry into
such a mess with its past decisions and treaties.
The shareholders of the plant agreed at last Thursday's AGM that the proposed reform is a
potential threat to future operations, Dogsa said. However, the full extent of the threat will be
known once the details of the reform are known.
According to him, there is limited room for manoeuvre in production. "Slovenian experts and
politicians will have to make up their mind soon...we're talking about an extensive problem
facing the less developed part of Slovenia," Dogsa told STA.
The Commission proposed a gradual 39% cut in the sugar price guaranteed by the EU and a
drop in the price of sugar beet, together with a compensation system for loss-making sugar
producers who might be forced to halt production because of the measure.
While not putting forward a cut in sugar quotas explicitly, the Commission aims at reducing
them step by step from the current 17.4 million tonnes for the EU 25 to some 6.2 million
tonnes.
Tovarna sladkorja Ormoz generated revenues of SIT 10.5bn (EUR 43.8m) last year, an
increase of over 25 percent on 2003. Despite the strong sales, the company blamed large
write-offs for the net loss of SIT 241.2m (EUR 1m).
The Ormoz-based company is in the majority ownership of Dutch company Cosun, which
controls a 58% stake. It produced around 60,000 tonnes of white sugar last year, all of which
was sold in Slovenia.
Ljubljana Airport Criticised for Lax Security
The Ljubljana Airport beefed up security after it was criticised by a European inspection for
the lax security checks upon entry into the international zone
After the oral reprimand, Brnik airport immediately started carrying out stricter control, which
has led to longer queues, STA learnt at the airport on Tuesday, 28 June.
The airport has therefore called on all passengers to arrive at the airport two hours before
scheduled departure.
Moreover, it is considering introducing a second entry point for the international zone and
increasing the number of staff at security checks.
The European inspectors, who checked the airport two weeks ago, are expected to draw up a
report on their visit within six weeks and submit it to the Civil Aviation Authority, the airport
also said.
22
COMPANIES
Domel Increases Sales, Profits Drop
Domel, the Zelezniki-based maker of electric motors, increased sales by 5.3% last year to SIT
13.7bn (EUR 57.2m) despite what it says were adverse market conditions. Profits slumped by
6.4% to SIT 110m (EUR 0.46m) in the same period, the company said on Tuesday, 28 June
According to chief executive Pavel Demsar, sales were hit by fierce competition from China,
lacklustre growth in Europe and a low dollar. To stay in the game, Domel will have to cut
costs and develop new high-end products, Demsar told the press.
To achieve this, the company embarked on a EUR 4m development of a new, lighter electric
motor for vacuum cleaners. Domel has already started shipping the product to its new big
account, Phillips, and hopes to sell it to the existing customers, in particular Electrolux.
Demsar expects sales to remain level or improve this year, although the cost of raw materials
has increased early in 2005.
Domel makes 85% of its sales on the European market, where it claims to hold a 50% market
share. According to Demsar, the company does not plan any layoffs.
PM Praises Home Appliance Maker as Example for Others
Prime Minister Janez Jansa has praised home appliance group Gorenje as an example to
other Slovenian companies
Visiting the Velenje-based company ahead of Wednesday's, 29 June cabinet visit to the region
of the Savinja and Saleska valleys in the east of the country, Jansa said that Gorenje has been
successful in demanding segments.
"Gorenje puts emphasis on segments that are needed for fast development, such as innovation,
sensible risk-taking and timely planning," Jansa told the press after meeting with the
management of Gorenje on Tuesday, 28 June.
Jansa said that Gorenje is being run by capable people. The company has a bright future on
the global market, he said.
Asked how the state intends to withdraw from the economy, including from Gorenje, Jansa
said that the state is only a portfolio investor in Gorenje, as it holds a small stake.
"In areas where the government remains an owner, it will no longer carry out an active
management role," he said.
Moreover, he promised that the government would restructure the two state-run funds that
hold most of the state's shares in major Slovenian companies, KAD and SOD.
Especially with KAD, the government wishes to establish a strong and sustainable financial
corporation that could act as a buttress for the pension system, he said.
Meanwhile, Gorenje chairman Franjo Bobinac underscored that the company simply wants a
business-friendly environment. "We aren't asking for anything else," Bobinac said.
Gorenje will support all government measures that are aimed at reducing the tax burden on
businesses, promoting greater flexibility in labour legislation and bolstering competitiveness,
he added.
Koncept Optimum Employees File for Bankruptcy
Employees of a small textile company, Koncept Optimum, filed for bankruptcy on Tuesday, 28
June at the District Court in Murska Sobota after the company manager failed to pay them
wages
The proposal for bankruptcy was filed on behalf of 112 employees who believe this could be
a solution to the troubled company.
23
Trade union official Danilo Sipos said that while they were unable to get all the necessary
documents from the employer, they believe the documents handed to the court prove the
conditions for bankruptcy have been met.
The company first made headlines on 11 April when some 200 employees, among them 60
from the neighbouring Hungary, went on strike because Miran Druscovich had failed to pay
out the February wages.
The company, based in the northeastern town of Lendava, had received nearly EUR 618,000
in state aid in order to preserve jobs in Prekmurje, Slovenia's least developed region.
While some workers went back to work in early June, when the manager paid the part of the
outstanding wages as agreed, the majority keep striking, demanding guarantees that he would
pay out the remaining debt.
Some 50 employees who oppose bankruptcy are at work. On Monday, 27 June, Druscovich
repeated his appeal to the strikers to go back to work, in which case, he said, he would be able
to pay what he owes them in a month.
Store Steel Mill to Bolster Production in Next Five Years
Shareholders of the steel mill Store Steel backed the business plan for the next five years at a
meeting on Monday. According to the plan, the company is to invest EUR 40m in the
modernisation of production, the company said in a press release Tuesday, 28 June
The company said the investment would boost output by 165,000 tonnes a year, worth EUR
114m in annual revenues. Store Steel is thus to increase the number of employees to 520, with
an additional 120 workers to be employed in the next five years.
The investment in new production capacity is expected to be launched by the end of this year,
the company said.
The construction of a new facility in the rolling mill section, worth SIT 400m (EUR 1.7m),
has already been completed. Furthermore, the second phase of building a new waste water
treatment facility has been launched and is expected to be concluded in August.
The Store-based company is planning to purchase a new rolling mill line worth EUR 3.5m.
According to the press release, negotiations are still underway, however, the company's goal
is to set up the new line by September 2006.
Money is also to be channeled for improving the working environment and employee training.
The company believes that investing in knowledge and skills of the employees enables greater
flexibility of the firm and a better response to the needs of the market, Store Steel director
Marjan Mackosek said.
Zavarovalnica Maribor to Start Merging with Tilia
Insurer Tilia is to start merging with Zavarovalnica Maribor in the autumn, the chief
executive of Zavarovalnica Maribor, the country's No. 2 insurer, said in an interview for
Dnevnik
"The merger is important for the owners. Why have two insurance companies when we can
have one that is stronger," Drago Cotar told the daily on Tuesday, 28 June.
Zavarovalnica Maribor's biggest owners are reinsurance company Pozavarovalnica Sava
(45.63%) and the bank Nova Kreditna banka Maribor (49.96%). Pozavarovalnica Sava is also
the largest owner of Tilia (99.47%).
Asked about the formation of the second financial pillar (Zavarovalnica Maribor plus
Pozavarovalnica Sava and NKBM), Cotar said that the formal establishment of such a pillar
would not entail major changes for the insurer.
"Such a pillar already exists in a way and different ownership links will not contribute to more
business. What is more interesting is that we share with NKBM 60% of the customers, and
this is where the synergies lie," he told Dnevnik.
24
Adriatic and Slovenica Shareholders Approve Merger
The shareholders of insurers Adriatic and Slovenica gave the go-ahead to the proposed
merger of the two companies at their respective AGMs on Tuesday, 28 June
The shareholders of the two companies approved almost unanimously the plan by which
Slovenica will become part of Adriatic, creating the second-largest insurance group in the
country with a market share of 17%.
The seat of the new company "Adriatic Slovenica" will be in the coastal city of Koper, with
the management board consisting of two members, one from each insurance company.
Adriatic chairman Joze Novak will be the chairman of the merged company.
Company officials told the press on Tuesday, 28 June that the applications for the registration
of the new company would be filed with the Insurance Supervision Agency by the end of this
month.
The swap ratio is 0.38 Slovenica shares for one Adriatic share. Adriatic's share capital is to
increase to SIT 3.66bn (EUR 15.3m) with the transaction.
The financial services group KD Group will be the majority owner of the new company with
a 90% share.
According to Janez Bojc, the chief supervisor at Adriatic, the newly-established company
anticipates to make synergy savings of SIT 2.5bn (EUR 10.4m). The company's aim is to
bolster its position on the domestic and regional markets, he added.
The merger of the two insurers is a good basis for future development and operations,
Slovenica chairman Anton Koncik told the press today.
Koncik also said that 164 workers would become redundant as a result of the merger,
although not all would be laid off. According to him, some workers will be allowed to go into
early retirement and some will be moved to new positions.
Slovenica deals only in property insurance, as its life insurance business was spun off at the
beginning of the year. Meanwhile Adriatic, the third-largest insurer in the country, sells both
life and property insurance.
In 2004, the two companies collected premiums worth SIT 44bn (EUR 183.6m), which they
intend to increase to SIT 53bn (EUR 221.2m) by 2006. Their combined profit in 2004 was
SIT 780m (EUR 3.25m). For this year, the two companies anticipate to make combined
profits of SIT 1.2bn (EUR 5m).
New NLB Supervisors Appointed
A new supervisory board was appointed by the shareholders of Slovenia's largest bank, Nova
Ljubljanska banka (NLB), on Wednesday, 29 June in Ljubljana. The 11-member supervisory
got six new members, while five incumbents are staying on
The state, which owns 35.41% of the bank, nominated six supervisors, all of which got the
backing of the AGM. The new supervisors are Ziga Lavric, Igor Marinsek, Marko Rus, Peter
Jesovnik, Andrijana Starina Kosem as the representative of the Pension Fund management
(KAD) and Zvonko Ivanusic for the Restitution Fund (SOD).
The latter is the only government nominee to stay on as supervisor. Meanwhile, Anton Zunic,
Uros Slavinec, Borut Jamnik and Metka Tekavcic will be replaced by the new appointees.
Igor Kusar's term expired in November 2004.
The Belgian banking and insurance group KBC, which owns 34% of the bank, nominated the
incumbents Andre Bergen, Christian Defrancq and Francois Louise Florquin. Meanwhile,
Riet Docx will replace Dirk Mampaey, whose term expired earlier this year.
The European Bank for Reconstruction and Development (EBRD), which owns 5% of NLB,
nominated its incumbent Anne Fossemalle.
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Outgoing head of the supervisory board Anton Zunic told the press that the outgoing
supervisors remained true at all times to the principle of corporate management and took
important decisions that upheld NLB's strategy.
According to him, there is no reason the new supervisory board should not continue to pursue
this strategy. "I see no indications that the new supervisory board would change this strategy,"
he told the press.
NLB operated well during the term of the outgoing supervisory board, Zunic said. "The total
assets of the bank rose substantially in this period in spite of the difficult conditions on the
market," he added.
The shareholders also decided today to allocate SIT 2.75bn (EUR 11.5m) of last year's
distributable profit of SIT 3.44bn (EUR 14.37) for the payout of dividends. The dividend will
stand at SIT 358.28 (EUR 1.50) gross per share.
NLB last year posted a net profit of SIT 8.7bn (EUR 36.3m), up 38.8% over the year before.
According to Zunic, the bank beat forecasts in the first quarter of this year.
Ultra Enters Joint Venture with Mobile Giant NTT DoCoMo
Ultra, a Slovenian technology company, announced on Wednesday, 29 June the signature of a
joint venture and share subscription agreement worth US$ 28.6m with NTT DoCoMo, Japan's
biggest mobile operator
Under the agreement, DoCoMo will acquire a 49% stake in Telargo Inc, so far Ultra's whollyowned US-based fleet management service provider.
The company is the holder of the intellectual property rights deriving from TalkTrack mobile
assets management platform.
"With this global partnership, we are expanding our mobile asset management business,
already operating under the TalkTrack brand in Slovenia and several other countries," said
Ultra CEO Gregor Breznik.
"ULTRA and NTT DoCoMo will exploit the synergy from merging our knowledge and
experience in mobile asset management with NTT DoCoMo's highly successful and world
renowned mobile telecommunications business," he said according to Ultra's press release.
Telargo's service is based on a mobile asset management platform providing comprehensive
fleet and workforce management tools. Telargo plans to offer its service worldwide starting
from fall 2005.
Peklar Denies Money Laundering Allegations
Leonardo F. Peklar, the director of the Socius corporate governance consulting group, denied
any tax evasion or money laundering on Wednesday, 29 June a day after a TV station
reported he was suspected of unlawful transactions worth some EUR 1.2m
Peklar told the press in Ljubljana it was absurd to think he would put at risk almost 15 years
of hard work for his company. He moreover believes the scandal was masterminded to cause
him business damage.
He also labelled as absurd the allegation that somebody would launder money by
"transparently depositing it on my bank account", and announced he would hand over all
documents to relevant authorities to prove his innocence.
Meanwhile, another company reportedly involved in the scandal said today it knew absolutely
nothing about Peklar's alleged financial deals with the Swiss company Bados Consulting,
although it cooperated with it in 2002 and 2003.
Slovenian mobile operator Mobitel said it gave the police all documents regarding its business
with Bados Consulting when visited by it around a month ago. Mobitel added it had been
established back then it had done nothing wrong or unlawful.
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Dnevnik reported today that Peklar's disputed transactions were linked with business deals
involving Mobitel. It added the police had been trying to establish whether Peklar did mobile
market research for Mobitel in Austria and Switzerland.
Mobitel said in a press release it had commissioned Bados Consulting a number of studies
regarding its plans to go international, the telecommunications markets in Central and Eastern
Europe, the search for strategic partners, and plans for its entry in Kosovo.
Slovenian Car Industry Supplier Opens an Investment in Serbia
Livnica Kikinda Cimos, the Serbian company in majority ownership of Slovenia's Cimos,
opened an EUR 11m production facility in the town of Kikinda on Saturday, 03 July
The move is one in a series of planned car parts facilities that should see the Kikinda-based
company become one of the biggest Serbian exporters.
Chairman of the Cimos board Franc Krasovec announced the company would open another
facility, worth EUR 23m, in September, and upgrade two more production units. Cimos,
which develops and produces automotive components, bought a 67.7% stake in Livnica
Kikinda, one of Serbia's former industrial giants, last September.
The contract signed with the Serbian Privatisation Agency was worth EUR 100m, 60% of
which was designed to go for investment and 31% for Livnica's debts.
The Serbian government chose Livnica Kikinda as a test ground for a privatisation model
based on previous restructuring.
The new unit, which was built anew and will employ 100 workers, will produce hi-tech steel
parts for the automotive industry.
The other facility, to open later this year, will produce parts for car makers such as Peugeot,
Renault and BMW.
Yesterday's opening was attended by a number of Serbian officials, including PM Vojislav
Kostunica, who opened the new investment.
Gorenjska Banka Tops Country Ranking
Gorenjska banka has been declared Slovenia's best bank for 2004 by the British association
Finance Central Europe. The chief executive, Zlatko Kavcic, was named the country's top
banker, the bank said in a press release
Additionally, the bank emerged on top in terms of return on assets (ROA) and return on
equity (ROE), whereby it is 10th in Southeast Europe by ROA and 21st by ROE.
The bank ended the year with net profits at SIT 9.5bn (EUR 39.65m), which places the ROA
at 4.8%, over four times the average of Slovenian banks (1.1%). Return on equity was at
24.7%.
Gorenjska banka is the country's 7th largest bank by assets. Its majority owners are chemical
and tourism group Sava and hardware chain Merkur.
Heraklith to Take Over Termo Despite Some Problems
Despite year-long problems with the company manager, Austria's Heraklith intends to take
over Slovenian maker of insulation materials Termo in what it considers a key step in its
eastward expansion, chairman Roland Platzer told the press in Ljubljana on Thursday, 30
June
Heraklith CFO Edward Zehetner meanwhile explained that the chairman of the Termo
management board Janez Dezelak has been recently dismissed by the supervisory board due a
number of irregularities.
For instance, he did not give supervisors the right figures about Termo's 2004 business, or
failed to register Trimo shares with the Clearing and Deposit Corporation on time, according
to Zehetner.
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This prevented Heraklith from issuing a takeover bid even if it directly or indirectly controls
75% of Termo. Once given the green light by the securities market watchdog, it will go ahead
with the takeover bid, he said.
While Dezelak was replaced by Aljosa Krizman, he still claims to be the legitimate chairman.
His claims come despite a court ruling approving the change in management earlier this week,
said Platzer.
The dispute may well end up in court as both parties have announced to use all legal means to
resolve it.
Outlining Heraklith's plans for Central and Eastern Europe, Platzer said all companies in the
east in which his company has shares will be united in Termo, the Skofja Loka-based
company with a 40-year tradition.
Zavarovalnica Maribor Ups Collected Premiums by 7%
Zavarovalnica Maribor, the country's largest insurer, has collected premiums worth SIT
21.2bn (EUR 88.5m) in the first five months of the year. This is 7% more than the year before
and in line with plans, chief executive Drago Cotar told the press on Monday, 27 June in
Ljubljana
In the same period, the amount of payouts for damages totalled SIT 11.4bn (EUR
47.6m), according to Cotar.
The Maribor-based insurer plans to collect premiums worth SIT 46bn (EUR 192m) by the end
of the year, up 9% over 2004. Payouts are meanwhile expected to drop.
Brunner Shocked at Money Laundering Allegations
Paul Brunner, a Swiss business partner of the director of the Socius corporate governance
consulting group Leonardo F. Peklar, denied on Friday, 01 July his and Peklar's involvement
in a tax evasion and money laundering scandal
His reaction comes after the public TV broadcaster had reported that Peklar was suspected by
the money laundering watchdog of unlawful transactions worth some EUR 1.2m in which
Brunner was supposedly involved as well.
In a press release, Brunner labelled the allegations both "serious and false", explaining that he
did give Peklar a private loan. He also added he was not the director of Bados Consulting, the
company with which Peklar allegedly made the unlawful transactions, as reported by the
media.
According to Brunner, every investigation should be private until it is not concluded. "I
cannot believe it. I'm shocked and upset that it is possible to publish incorrect information in a
country like Slovenia," he added.
Brunner also said that this violates his integrity, strongly affecting his and Peklar's reputation,
and the future of the Socius consulting group. This is not only an unjustified media attack, but
a genuine "which hunt", he stressed.
Brunner hopes the persons responsible will answer for this. "Accusing someone of something
without any proof will without a doubt trigger numerous reactions," he believes.
The allegations were also denied earlier this week by Peklar, who said the scandal was
masterminded to harm his business.
Mutual Insurer Raises Premiums for 900,000 People
Mutual insurance company Vzajemna, the largest health insurer in the country, raised
premiums for most customers by 5.8% as of July. The price hike will affect about 900,000
people who have supplementary health insurance with Vzajemna
Higher premiums will be paid only by those people whose premiums have not changed since
September 2002.
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On the other hand, the smaller share of the insured persons, who have life-long insurance or
have transformed it into a 12-year insurance, will not pay the higher price.
According to Robert Sraka, the director of Vzajemna's development and actuary department,
the price increase is a lot smaller than needed.
However, there have been some positive developments in the resolution of problems faced by
insurers offering supplementary health insurance, he said at the end of May.
In his view, the main solution to the problem would be the proposed risk equalisation system,
meaning that health insurers with younger customers, whose health costs are lower, will cofinance those companies with older customers, most notably Vzajemna.
Meanwhile, the director general of Slovenia's Health Insurance Institute (ZZZS) said that
today's price rise was "unnecessary". Borut Miklavcic told the press on Friday, 1 July that
"Vzajemna should instead streamline its business".
Vzajemna last year collected premiums worth SIT 56.5bn (EUR 235.8m), while payouts
totalled SIT 51.9bn (EUR 216.6m). The company concluded 2004 with a loss of SIT 2.8bn
(EUR 11.7m), which it partially covered by reducing reserves. The loss thus stood at SIT
1.7bn (EUR 7.1m).
Zagozen Takes Over at HSE
Joze Zagozen, 54, took over as the new general manager of Holding slovenske elektrarne
(HSE), Slovenia's largest power producer, on Friday, 01 July. He said the priorities of his
four-year term would be to ensure safe, reliable and cost-effective energy supply in
conjunction with other power companies
Zagozen told the press today he intends to get in-depth information about the performance
and business plans of HSE in the coming weeks, the overall situation in the industry, and meet
key managers.
One of the open issues is privatisation and the arrival of foreign strategic partners, he said, but
urged caution. "It is clear that the interest is to get the most lucrative parts of the system, so
we have to watch out that the state will not get stuck with the less profitable parts," he said.
Moreover, a solution will have to be found for big industrial users who purchase electricity at
subsidised prices. "An immediate change in prices could case severe social disruptions, so
programmes with defined time-frames should be drafted to address this," he thought.
Zagozen also promised he would not make all decisions himself, but would consult the
experts. Moreover, politics will not interfere. "I will only support things that enjoy the support
of the public and the experts," he said.
He said the management team will remain the same for now: Milan Medved will stay on as
chief operating officer and Ladislav Tomsic the technical manager.
Zagozen, who has a PhD in economics, is also the chief supervisor of the country's largest oil
company, Petrol. He was also the economics minister in the shadow cabinet of current PM
Janez Jansa.
Triglav Anticipates to Increase Profit by Half in 2005
The supervisory board of the largest insurer in the country backed Thursday, 01 July the
company's upgraded business plan for 2005. In line with the new plan, Zavarovalnica Triglav
expects this year's profit to exceed the EUR 11.5m from 2004 by 50%
The plan of the new management board, which took over in early June under the leadership of
Andrej Kocic, also envisages cost-cutting and an overhaul of operations, STA was told on
Friday by chief supervisor Damjan Mihevc.
The supervisory board also backed a schedule for a capital injection, should it prove to be
necessary, Mihevc explained, adding the management was tasked to prepare what is necessary
for the move.
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Should Triglav actually embark on the supply of fresh capital, it would most likely be carried
out in the autumn in the amount ranging from SIT 7 to 10bn (EUR 29m to 41.7m).
When Kocic was appointed, he said that "the main promise I gave to the supervisors was to
increase the profitability of Triglav. But I have no magic wand".
He also told the daily Dnevnik that he expected the owners of the company, which is majority
state-owned, to vote on a capital injection before the year is out.
Triglav shareholders are to meet on 13 July.
Krka Drug Taken Off Shelves in Bosnia
Drug maker Krka received on Wednesday an unofficial report from the Health Ministry of
Bosnia-Herzegovina, which has demanded that all pharmacies in Sarajevo region take Krka's
Naklofen Retard tablets off the shelves, the company said on Thursday, 30 June
The demand came after the Bosnia-Herzegovina Drug Research Institute established that the
tablets did not pass the standard test of its active ingredient. However, the profile of the
tablets' active ingredient is not harmful to patients, Krka said.
In the meantime, the company has already reviewed the documents regarding the quality test
of the pills, finding no fault. The drug has been analysed in accordance with the standard
quality specification, the company said.
The firm has been producing Naklofen Retard tablets - an non-steroidal anti-inflammatory
drug - for several years now, exporting them to numerous European countries. They have had
no problem with the quality of this product before, Krka said.
The Novo mesto-based company expects the Bosnian ministry to provide an official statement
and the results of the analysis.
Jankovic: Mercator's Goal to be No. 3 in Croatia
Slovenia's leading retailer Mercator would like to be one of the three biggest retail chains in
Croatia, its chairman Zoran Jankovic said as he spoke about his company's plans in
Slovenia's neighbour on Thursday, 30 June.
Jankovic is not worried that Mercator keeps making losses in Croatia: "We grow by an
average 25% a year and we've bought 18 locations that will begin to operate in the next three
years," he told the Croatian daily Jutarnji list.
Speaking about which Croatian company Marcator is planning to take over, Jankovic said
"the one that is closest to us, this is all I can say now". "Regional links are key to success in
entering Europe," he added.
Answering speculations about his dismissal under the new government, Jankovic said that
while some would like to see him leave, "I'll decide when I'll leave Mercator".
Last week a Slovenian business daily said that Mercator will get a new supervisory board in
October. In the most likely scenario, the state will get four supervisors, giving the coalition of
PM Janez Jansa the means to replace Jankovic, the paper added.
Third Largest Bank Gets New Supervisory Board
Abanka Vipa, Slovenia's third largest bank by assets, got a new supervisory board on
Thursday, 30 June according to the bank's press release
Head of car trader Stajerski avtodom Dragisa Milosavljevic, Srdan Tovornik of casino
company Hit and chief executive of commutator manufacturer Kolektor Stojan Petric have
been named to the supervisory board.
The other members include head of Prva pokojninska druzba pension fund Alenka Znidarsic
Kranjc, director of Pension Fund Management (KAD) Tomaz Toplak, head of holding Zvon 1
Simon Zdolsek and Katja Bozic of the Finance Ministry.
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According to Abanka Vipa, the last meeting of the old supervisors was held on Wednesday,
29 June when the board reviewed the performance report for the January-May period.
According to the bank's management, the board agreed to set limits of exposure to individual
companies based on which the bank's overall exposure would increase in accordance with to
the banking act.
The bank's management on Wednesday informed the supervisors of the sale of the bank's
44.4% share in asset management firm NFD, which was bought by NFD, Maksima Invest,
NFD Holding, Banka Celje, Banka Koper and Probanka at a total price of SIT 5.8bn (EUR
24.2m).
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FAIRS, CONGRESSES
No Significant Changes in Public Sector after EU Entry
Slovenia's EU entry did not bring about any significant changes in the public sector, the
participants at a round-table debate on the public sector following EU entry established on
Thursday, 30 June at the business conference of the public sector
"There were no big changes in the field of public utility companies. The EU provides general
guidelines, while finding solutions for concrete issues is mainly left to the countries
themselves," head of the government Institute of Macroeconomic Analysis and Development
(IMAD) Janez Sustersic explained.
Asked whether the state can be a good owner, Sustersic said serious analyses indicate it is not.
According to him, the state must fulfil the following conditions to protect public interest: it
has to ensure the safety and reliability of services, their availability and competitiveness.
Sustersic said state ownership is not necessarily the best way to provide this, adding the
development strategy favours a reflection of ways to draw in private bidders and still preserve
the public interest.
Sustersic exposed public utility service as a problem area for regulated prices, where the price
system was not established appropriately. The prices of services differ among municipalities,
which according to Sustersic makes the system intransparent.
According to several assessments, most achievements in the past months were made in
electronic communications. Deputy director of the Post and Electronic Communications
Agency Tomaz Simonic said some goals were set in the area and dialogue among the
operators and with the agency has been established.
Zan Oplotnik of the Maribor-based Faculty of Economics said the basic question in business
infrastructure such as motorways, railways and energy was how to draw in concessionaires.
"There is enough money in the market, but the question is whether the projects are profitable
enough," Oplotnik said, adding many projects were open in the energy sector and that it was a
matter of political will whether the state would pass the best projects on to the
concessionaires.
NATO-Russia Council Conference Begins in Ljubljana Today
More than 150 representatives from 27 countries will discuss ways of fighting terrorism as a
four-day NATO-Russia Council conference begins in Ljubljana on Tuesday, 28 June
The experience of the latest terror attacks in the US, Turkey, Spain and Russia are to be
debated by civil crisis and military experts from Russia and NATO members, the Slovenian
Foreign Ministry said in a press release.
Information is to be exchanged about national anti-terror measures and the capabilities of
individual states in order to make the fight against terrorism more effective, according to the
ministry.
The conference is organised by the George C. Marshall European Center for Security Studies
and the US mission at NATO in collaboration with the Slovenian Foreign Ministry.
The NATO-Russia Council was set up in May 2002 to encourage NATO's cooperation with
Russia in a number of fields where the two sides have similar interests.
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SLOVENIA IN BRIEF
Politbarometer Poll: Support for Jansa Govt Down Slightly
Fifty-six percent of those polled in the Politbarometer survey in June support the right-leaning
government of Janez Jansa, down 1 percentage point on May. The share of those opposing the
government increased to 32% from May's 29%, with 11% undecided as compared to 14% last
month.
Panel Hands OSCE Reform Proposal to Rupel
An OSCE panel debating reform of the organisation has handed to Foreign Minister and
OSCE Chairman Dimitrij Rupel a report containing reform proposals aimed at making the
security organisation more effective. The panel reached consensus on all but one of the
recommendations, and we hope this will increase the possibility of the recommendations
being adopted by the 55 OSCE participating states, said the chair of the Panel of Eminent
Persons, Ambassador Knut Vollebaek, as he presented the report to Rupel in Ljubljana on
Monday, 27 June.
Rupel Meets Minority ahead of Talks with Hungarian FM
Foreign Minister Dimitrij Rupel held talks with representatives of the Slovenian minority in
Hungary on Monday, 27 June a day before he is scheduled to meet his Hungarian counterpart
Ferenc Somogyi.
Two Slovenians Nominated for Nobel Peace Prize
Swiss member of the Council of Europe, Ruth-Gaby Vermont Mangold has nominated 1000
women for the 2005 Nobel Peace Prize to honour 100th anniversary of the first time this
award was conferred on a woman. The nominees also include Slovenian paediatrician Anica
Mikus-Kos and anthropologist Svetlana Slapsak. Pediatrician and child psychologist Dr Anica
Mikus Kos is the head of the Together Foundation - Regional Centre for Psychosocial WellBeing of Children. The institution has been providing assistance to children from war-torn
zones in Croatia, Bosnia and Herzegovina, Macedonia, Kosovo, Ingushetia, Georgia, and
Iraq. According to the www.1000peacewomen.org website, anthropologist Svetlana Slapsak,
a professor at Ljubljana Graduate School of Humanities, has promoted freedom of expression
and human rights since the 1960s. She initiated a petition to ban the death penalty in 1983, the
first to be published in the Yugoslav media. She continues to work for a culture of peace
throughout former Yugoslavia.
Ambassador Benedejcic Accredited to Turkmenistan
Slovenian Ambassador to Russia Andrej Benedejcic presented his credentials to Speaker of
the Turkmenistan Parliament Ovezgeldy Atayev on Monday, 27 June in Ashkhabad.
Benedejcic told STA this was his first accreditation to one of the five Central Asian countries
he would cover from Moscow. He hopes to present the credentials in the other four and
Belarus as early as this year.
Regulations on Women Quotas for Local Elections to Be Eased
The parliamentary committee for local government has decided to relax the requirements for
women quotas at local elections. The initially proposed 25% mandatory quota for the 2006
local elections has thus been reduced to 20%. Under the proposed amendments to the local
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elections act, the quota will be raised to 30% for the 2010 elections and 40% for 2014. The
"zipper" system remains in place, the committee decided on Wednesday.
Slovenia Gets Four New Ambassadors of Science
Alojz Kralj, Ivan Kreft, Anton Gosar and Lojze Marincek will be conferred the title of
Slovenia's Ambassador of Science, the annual award given out by the Ministry of Higher
Education, Science and Technology for the promotion of Slovenia through outstanding
achievement in science and research. The laureates received the award from Minister of
Higher Education, Science and Technology Jure Zupan at a ceremony in Ljubljana on
Thursday evening, 30 June.
Government Appoints Romsek Police Chief
The government appointed Joze Romsek the new director general of the Slovenian police at
its session on Thursday, 30 June. Outlining his priorities, Romsek, 51, said he wants to
improve road safety and make the police force even more successful in preventing crime.
Moreover, there will be many new tasks as Slovenia's southern border becomes an external
border of the EU in 2007, Romsek told the press after the government session. A police
officer by profession, Romsek has not worked in the police force since 1982. He has held a
number of posts at the Defence Ministry, including the job of legal adviser to incumbent
Prime Minister Janez Jansa when he served as defence minister back in the early 1990s. Most
recently, he was employed in the office of the transport minister.
Slovenia to Help Children of Chernobyl
The government earmarked SIT 3.5m (EUR 14,600) Thursday, 30 June to help Ukrainian
children hurt by the 1986 Chernobyl catastrophe rehabilitate. The aid will enable 30 children
affected by the worst nuclear accident ever to spend a holiday in Slovenia this summer. The
children are to arrive in the second half of August to stay at the youth health resort Debeli
Rtic for two weeks. The seaside climate should help cure the consequences they had suffered
in the nuclear disaster. The project is being carried out by the Slovenian Red Cross.
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